B-182843, MAY 15, 1975

B-182843: May 15, 1975

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OR OTHERWISE DEFICIENT SPECIFICATIONS IN A SOLICITATION IS NOT. CANCELLATION AFTER BIDS ARE OPENED IS APPROPRIATE WHERE RECORD SUPPORTS PROCURING ACTIVITY'S DETERMINATION THAT AWARD THEREUNDER TO LOW BIDDER WOULD NOT SERVE ACTUAL NEEDS OF GOVERNMENT. 716.80 WAS THE LOWEST. THE COAST GUARD INFORMED CDI THAT THE INVITATION WAS CANCELLED AS THE COAST GUARD WAS CONSIDERING A PROPOSAL TO USE LOCAL TELEPHONE COMPANY LINES INSTEAD OF ITS OWN TELEPHONE LANDLINE SYSTEM. CDI PROTESTED TO THE COAST GUARD THAT IT DID NOT HAVE THE AUTHORITY UNDER FEDERAL PROCUREMENT REGULATIONS (FPR) SEC. 1-2.404 (1964 ED.). TO CANCEL THE IFB AFTER BIDS WERE OPENED SINCE THE REQUIREMENT FOR TELEPHONE SERVICES STILL EXISTED AND ITS EQUIPMENT MET THE SPECIFICATIONS.

B-182843, MAY 15, 1975

WHILE THE INCLUSION OF INADEQUATE, AMBIGUOUS, OR OTHERWISE DEFICIENT SPECIFICATIONS IN A SOLICITATION IS NOT, ITSELF, "COMPELLING REASON" TO CANCEL AN IFB, CANCELLATION AFTER BIDS ARE OPENED IS APPROPRIATE WHERE RECORD SUPPORTS PROCURING ACTIVITY'S DETERMINATION THAT AWARD THEREUNDER TO LOW BIDDER WOULD NOT SERVE ACTUAL NEEDS OF GOVERNMENT.

COMMUNICATIONS DESIGN, INCORPORATED:

COMMUNICATIONS DESIGN, INCORPORATED (CDI), PROTESTS THE CANCELLATION OF INVITATION FOR BIDS (IFB) 03-6223-75, ISSUED BY THE OFFICE OF COMMANDER, THIRD COAST GUARD DISTRICT, ON AUGUST 29, 1974, FOR THE PROCUREMENT OF A PRIVATE AUTOMATIC BRANCH EXCHANGE (PABX) FOR A TELEPHONE COMMUNICATIONS SYSTEM FOR A COAST GUARD STATION. OF THE THREE BIDS RECEIVED AND OPENED ON SEPTEMBER 23, 1974, CDI'S BID OF $17,716.80 WAS THE LOWEST. BY LETTER DATED NOVEMBER 20, 1974, THE COAST GUARD INFORMED CDI THAT THE INVITATION WAS CANCELLED AS THE COAST GUARD WAS CONSIDERING A PROPOSAL TO USE LOCAL TELEPHONE COMPANY LINES INSTEAD OF ITS OWN TELEPHONE LANDLINE SYSTEM. CDI PROTESTED TO THE COAST GUARD THAT IT DID NOT HAVE THE AUTHORITY UNDER FEDERAL PROCUREMENT REGULATIONS (FPR) SEC. 1-2.404 (1964 ED.), TO CANCEL THE IFB AFTER BIDS WERE OPENED SINCE THE REQUIREMENT FOR TELEPHONE SERVICES STILL EXISTED AND ITS EQUIPMENT MET THE SPECIFICATIONS. THEREFORE, IT IS ARGUED THAT AS THE LOW RESPONSIVE BIDDER IT WAS ENTITLED TO AWARD OF THE CONTRACT. IN ADDITION, SUBSEQUENT TO THE FILING OF THE PROTEST, THE CONTRACTING OFFICER INFORMED CDI AND OUR OFFICE THAT THE INVITATION WAS ALSO CANCELLED PURSUANT TO FPR SEC. 1-2.404-1(B)(1) ON THE BASIS THAT A REVIEW OF THE SOLICITATION FOLLOWING BID OPENING REVEALED THAT THE ORIGINAL SPECIFICATIONS WERE INADEQUATE IN THAT THEY DID NOT FULLY PROVIDE ALL THE PABX FEATURES REQUIRED BY THE PROCURING ACTIVITY.

IT IS THE POSITION OF THE COAST GUARD THAT THE CANCELLATION OF THE PROCUREMENT AND READVERTISEMENT OF THE REQUIREMENT UTILIZING REVISED SPECIFICATIONS ARE THE CORRECT MEASURES TO BE ADOPTED. ESSENTIALLY, THE COAST GUARD CONTENDS THAT THIS COURSE OF ACTION IS REQUIRED BECAUSE THE SOLICITATION'S ORIGINAL SPECIFICATIONS DID NOT PROVIDE FOR A MAIN DISTRIBUTION FRAME, SPARE PARTS KIT, INSTALLATION OF THE EQUIPMENT BY THE SUPPLIER, DID NOT SPECIFY A MAXIMUM CEILING HEIGHT FOR THE PROPOSED EQUIPMENT, AND DID NOT PROVIDE FOR LEASE/BUY CONSIDERATIONS.

FOR THE FOLLOWING REASONS THE PROTEST IS DENIED.

WE HAVE CONSISTENTLY HELD THAT AN IFB DOES NOT IMPORT ANY OBLIGATION ON THE GOVERNMENT TO ACCEPT ANY OF THE BIDS, AND THAT ALL BIDS MAY BE REJECTED UNDER VARIOUS CIRCUMSTANCES, INCLUDING INSTANCES WHERE THE SPECIFICATIONS ARE INADEQUATE. 50 COMP. GEN. 464,469 (1970). THE AUTHORITY CONCERNING CANCELLATION OF AN INVITATION AFTER BIDS ARE OPENED IS CONTAINED IN FPR SEC. 1-2.404-1 (1964 ED.) AS FOLLOWS:

"(A) PRESERVATION OF THE INTEGRITY OF THE COMPETITIVE SYSTEM DICTATES THAT, AFTER BIDS HAVE BEEN OPENED, AWARD MUST BE MADE TO THAT RESPONSIBLE BIDDER WHO SUBMITTED THE LOWEST RESPONSIVE BID, UNLESS THERE IS A COMPELLING REASON TO REJECT ALL BIDS AND CANCEL THE INVITATION. ***

"(B) INVITATIONS FOR BIDS MAY BE CANCELED AFTER OPENING BUT PRIOR TO AWARD, AND ALL BIDS REJECTED, WHERE SUCH ACTION IS CONSISTENT WITH SEC. 1- 2.404-1(A) AND THE CONTRACTING OFFICER DETERMINES IN WRITING THAT CANCELLATION IS IN THE BEST INTEREST OF THE GOVERNMENT FOR REASONS SUCH AS THE FOLLOWING:

"(1) INADEQUATE, AMBIGUOUS, OR OTHERWISE DEFICIENT SPECIFICATIONS WERE CITED IN THE INVITATION FOR BIDS."

OUR OFFICE ORDINARILY WILL NOT QUESTION THE BROAD AUTHORITY OF THE CONTRACTING OFFICER TO REJECT ALL BIDS AND READVERTISE WHEN A "COMPELLING REASON" TO DO SO EXISTS. SPICKARD ENTERPRISES, INC., 54 COMP. GEN. 145 (1974). WHILE WE HAVE HELD THAT THE MERE UTILIZATION IN AN IFB OF INADEQUATE, AMBIGUOUS OR OTHERWISE DEFICIENT SPECIFICATIONS IS NOT, ITSELF, ABSENT A SHOWING OF PREJUDICE, A "COMPELLING REASON" TO CANCEL AN IFB AND READVERTISE WHERE AWARD UNDER THE SOLICITATION AS ISSUED WOULD SERVE THE ACTUAL NEEDS OF THE GOVERNMENT, THAT IS NOT THE CASE HERE. GAF CORPORATION; MINNESOTA MINING AND MANUFACTURING COMPANY, 53 COMP. GEN. 586 (1974); 52 COMP. GEN. 285 (1972).

THE RECORD INDICATES THAT AFTER BID OPENING, THE COAST GUARD REQUESTED THAT CDI SUBMIT DETAILED TECHNICAL INFORMATION IN THE FORM OF A TECHNICAL SPECIFICATION FOR ITS PROPOSED EQUIPMENT TO ENABLE THE ACTIVITY TO DETERMINE THE PRECISE NATURE OF THE ITEM BEING OFFERED IN ORDER TO VERIFY THE BIDDER'S CONTENTION THAT ITS PABX WOULD IN FACT SATISFY THE GOVERNMENT'S NEEDS. THE LITERATURE INDICATED THAT THE EQUIPMENT PROPOSED TO BE FURNISHED UNDER THE INSTANT PROCUREMENT WOULD INCLUDE A MAIN DISTRIBUTION FRAME (MDF) CONSISTING OF "A SIMPLE SET OF SCREW TERMINALS, BLOCK MOUNTED, ON THE END OF ONE OF THE RACKS." CDI SUBSEQUENTLY ADVISED THE COAST GUARD THAT THIS WAS THE MDF THAT WOULD BE FURNISHED WITH ITS EQUIPMENT. HOWEVER, IT IS THE POSITION OF THE COAST GUARD THAT SUCH AN MDF WOULD NOT PROVIDE PROPER PROTECTION TO THE SWITCHBOARD FROM LIGHTNING, FOREIGN VOLTAGE OR TRANSITORY CURRENTS. MOREOVER, THE COAST GUARD STATES THAT THE MDF IT REQUIRES IS ESTIMATED TO COST $5,000 AND PROVIDES FOR PROPER CONNECTION AND ELECTRICAL PROTECTION WHEREAS THE MDF PROPOSED BY CDI PROVIDES FOR ONLY CONNECTION. SINCE WE HAVE CONSISTENTLY RECOGNIZED THAT GOVERNMENT PROCUREMENT OFFICIALS ARE GENERALLY IN THE BEST POSITION TO KNOW THE GOVERNMENT'S NEEDS AND BEST ABLE TO DRAFT APPROPRIATE SPECIFICATIONS, EAST BAY AUTO SUPPLY, 53 COMP. GEN. 771 (1974), WE HAVE NO BASIS TO QUESTION THE COAST GUARD'S REQUIREMENTS IN THIS REGARD.

FURTHERMORE, THE COAST GUARD ASSERTS THAT IT IS ESSENTIAL THAT THE PROPOSED EQUIPMENT FIT WITHIN THE EQUIPMENT ROOM AT ITS NEW SANDY HOOK STATION WHERE THE CEILING HEIGHT IS 7' 11 1/2". THE LITERATURE SUBMITTED BY CDI INDICATES THAT ITS PABX REQUIRES A MINIMUM CEILING HEIGHT OF 8' 5". CLEARLY, THE CDI PABX COULD NOT BE UTILIZED AT THE DESIRED LOCATION WITHOUT COSTLY MODIFICATIONS TO THE ROOM'S CEILING OR FLOOR. ALTHOUGH THE COAST GUARD HAS RAISED OTHER INADEQUACIES IN THE ORIGINAL SPECIFICATIONS JUSTIFYING ITS CANCELLATION OF THE IFB, WE BELIEVE THAT THE FOREGOING ARE DISPOSITIVE OF CDI'S PROTEST. UNDER THE CIRCUMSTANCES, IT IS CLEAR THAT AN AWARD TO CDI UNDER THE SOLICITATION AS ISSUED WOULD NOT SERVE THE ACTUAL NEEDS OF THE COAST GUARD.

ACCORDINGLY, WE FIND NO BASIS TO OBJECT TO THE COAST GUARD'S DETERMINATION TO CANCEL THE INSTANT SOLICITATION AND READVERTISE ITS PABX REQUIREMENT UNDER REVISED SPECIFICATIONS.