B-201116, MAY 15, 1981

B-201116, MAY 15, 1981

DIGEST: 1. MERE ACKNOWLEDGMENT OF RECEIPT OF AMENDMENT WHICH INCREASES TOTAL QUANTITY OF REQUIRED UNITS IS NOT SUFFICIENT TO CONSTITUTE BID FOR ADDITIONAL UNITS AT SAME PRICE BID FOR ORIGINAL QUANTITY. NEVERTHELESS, WHERE SOLICITATION PERMITTED BIDS FOR LESS THAN SOLICITED QUANTITY, LOW BIDDER'S FAILURE TO BID ON ENTIRE QUANTITY SOLICITED DOES NOT PRECLUDE AWARD BASED ON ORIGINAL QUANTITY. 2. OBTAINING REFERENCED FORMS NECESSARY FOR PREPARATION OF BID IS RESPONSIBILITY OF POTENTIAL BIDDER. 3. PROCURING AGENCY ADMITS IT INADVERTENTLY NEGLECTED TO REQUEST EXTENSION OF LOW BID. THIS CIRCUMSTANCE DOES NOT CONSTITUTE VALID OBJECTION TO PROPOSED AWARD AT PRICE LOWER THAN THAT BID BY PROTESTER. 4.PROCURING AGENCY INTENDS TO AWARD CONTRACT FOR QUANTITY LESS THAN TOTAL QUANTITY SOLICITED - AS PERMITTED BY SOLICITATION - AND TO EXERCISE OPTION PROVISION SUBSEQUENT TO AWARD IN ORDER TO OBTAIN TOTAL QUANTITY NEEDED. PROPOSED OPTION EXERCISE CANNOT BE QUESTIONED SINCE: (1) OPTION QUANTITY WAS NOT PART OF AGENCY'S FIRM REQUIREMENTS UPON WHICH COMPETITION WAS BASED AND (2) AWARD AND OPTION EXERCISE WILL RESULT IN LOWEST COST TO GOVERNMENT FOR NEEDED ITEMS.

CONTRACT MACHINING CORPORATION:

CONTRACT MACHINING CORPORATION (CONTRACT) PROTESTS THE CONTEMPLATED AWARD OF A CONTRACT TO ANY BIDDER OTHER THAN ITSELF UNDER INVITATION FOR BIDS (IFB) NO. DAAA09-80-B-4899 ISSUED BY THE UNITED STATES ARMY ARMAMENT MATERIEL READINESS COMMAND (COMMAND), ROCK ISLAND, ILLINOIS. BASED UPON OUR REVIEW OF THE RECORD, THE PROTEST IS DENIED.

THE IFB INITIALLY REQUESTED BIDS ON A QUANTITY OF 4,916 FLASH HIDERS, NSN 1005-00-716-2072, WHICH WAS INCREASED TO 5,261 BY AMENDMENT 0001. ASCENDING ORDER OF UNIT PRICES, THE BIDDERS WERE: ELCO INTERNATIONAL, INC. (ELCO), M. C. GENERAL, INC. (GENERAL), SICCO, AND CONTRACT. ONLY CONTRACT QUOTED A PRICE ON THE ENTIRE QUANTITY SOLICITED; THE OTHERS BID ON THE QUANTITY INITIALLY SOLICITED.

THE COMMAND INFORMS US THAT ELCO'S LOW BID EXPIRED BECAUSE THE COMPANY WAS "INADVERTENTLY NOT REQUESTED TO EXTEND ITS BID" AND THAT IT PROPOSES TO MAKE AWARD TO THE "REMAINING LOW BIDDER" (PRESUMABLY GENERAL) NOTWITHSTANDING THAT GENERAL DID NOT QUOTE A PRICE ON THE ENTIRE QUANTITY SOLICITED. ON THIS SCORE, THE COMMAND ARGUES THAT AWARD FOR THE INITIAL QUANTITY WOULD BE OTHERWISE PROPER UNDER THE IFB. THE COMMAND FURTHER ARGUES THAT THE ADDITIONAL UNITS NEEDED MAY BE OBTAINED BY EXERCISING THE OPTION GRANTED BY GENERAL AT THE SAME UNIT PRICE SET FORTH IN ITS LOW BID FOR THE INITIAL QUANTITY.

CONTRACT'S PROTEST HAS SEVERAL DIFFERENT BASES. WE WILL EXAMINE EACH IN THE ORDER PRESENTED BY THE PROTESTER'S COUNSEL. INITIALLY, CONTRACT CONTENDS THAT GENERAL'S BID MUST BE REJECTED AS NONRESPONSIVE FOR FAILURE TO ACKNOWLEDGE THE AMENDMENT AND FOR FAILURE TO QUOTE A PRICE ON THE ENTIRE QUANTITY SOLICITED. HOWEVER, GENERAL'S BID SPECIFICALLY ACKNOWLEDGED RECEIPT OF THE AMENDMENT. NEVERTHELESS, IT IS WELL ESTABLISHED THAT MERE ACKNOWLEDGMENT OF THE RECEIPT OF AN AMENDMENT INCREASING THE TOTAL QUANTITY OF UNITS IS NOT SUFFICIENT TO CONSTITUTE A BID FOR THE ADDITIONAL UNITS AT THE SAME PRICE BID FOR THE ORIGINAL QUANTITY. VENTURA MANUFACTURING COMPANY, B-193258, MARCH 21, 1979, 79-1 CPD 194. THUS, THE INITIAL QUESTION FOR DECISION IS WHETHER THE COMMAND MAY PROPERLY AWARD A CONTRACT FOR THE ORIGINAL QUANTITY SOLICITED.

THE FIRST PAGE OF THE IFB STATES THAT ALL OFFERS ARE SUBJECT TO THE SOLICITATION INSTRUCTIONS AND CONDITIONS OF STANDARD FORM (SF) 33A WHICH WAS INCORPORATED BY REFERENCE. IN RELEVANT PART, PARAGRAPH 10(C) OF SF 33A PROVIDES:

"(C) *** UNLESS OTHERWISE PROVIDED IN THE SCHEDULE, OFFERS MAY BE SUBMITTED FOR ANY QUANTITIES LESS THAN THOSE SPECIFIED AND THE GOVERNMENT RESERVES THE RIGHT TO MAKE AN AWARD ON ANY ITEM FOR A QUANTITY LESS THAN THE QUANTITY OFFERED AT THE UNIT PRICES OFFERED ***"

SINCE THE IFB DID NOT OTHERWISE REQUIRE THAT BIDDERS QUOTE A PRICE ON THE ENTIRE QUANTITY SOLICITED, BIDDERS WERE FREE TO BID ON THE ORIGINAL QUANTITY. THEREFORE, THE LOW UNIT PRICE BID BY GENERAL MAY BE ACCEPTED FOR THE INITIAL QUANTITY UNDER THIS IFB PROVISION. SEE OCTAGON PROCESS, INC., B-186850, DECEMBER 22, 1976, 76-2 CPD 521.

CONTRACT ALSO CONTENDS THAT PARAGRAPH 10(C) OF SF 33A SHOULD HAVE BEEN SPECIFICALLY BROUGHT TO THE ATTENTION OF BIDDERS IN THIS SMALL BUSINESS SET-ASIDE AND NOT MERELY INCORPORATED BY REFERENCE. HOWEVER, IT IS THE BIDDER'S RESPONSIBILITY TO OBTAIN FORMS INCORPORATED BY REFERENCE IN THE IFB. CONINE RENTALS INC., DBA BUDGET RENT A CAR OF SAN ANTONIO, B-194143, JUNE 26, 1979, 79-1 CPD 456. THEREFORE, WE REJECT THIS GROUND OF PROTEST.

NEXT, CONTRACT CONTENDS THAT AGENCY INACTION, RESULTING IN THE LAPSE OF ELCO'S BID, WILL COST THE GOVERNMENT AN UNNECESSARY $3,314.43, OR THE DIFFERENCE BETWEEN ELCO'S BID AND GENERAL'S BID. IN REPLY, AS NOTED ABOVE, THE COMMAND STATES IT INADVERTENTLY NEGLECTED TO REQUEST AN EXTENSION OF ELCO'S BID. WHILE IT IS REGRETTABLE THAT THE AGENCY CARELESSLY PERMITTED THE LOW BID TO EXPIRE, THIS CIRCUMSTANCE DOES NOT CONSTITUTE A VALID OBJECTION TO THE PROPOSED AWARD AT A PRICE LOWER THAN THAT BID BY CONTRACT.

CONTRACT ALSO QUESTIONS THE COMMAND'S ARGUMENT, NOTED ABOVE, THAT IT HAS THE RIGHT UNDER THE OPTION PROVISION TO ORDER THE ADDITIONAL QUANTITY SOUGHT. CONTRACT ARGUES THAT THIS ADDITIONAL QUANTITY SHOULD BE AWARDED UNDER A SEPARATE CONTRACT.

IN REPLY TO CONTRACT'S ALLEGATION THAT EXERCISE OF THE OPTION PROVISION WOULD BE IMPROPER IN THESE CIRCUMSTANCES, THE COMMAND ARGUES:

"EXERCISE OF THE OPTION IN THIS MANNER DOES NOT CONSTITUTE CONSIDERATION OF THE OPTION IN EVALUATION FOR AWARD OF THE CONTRACT. CLAUSE M.20.1, EVALUATION OF OPTIONS, PROVIDES THAT THE EVALUATION OF OFFERS WILL BE ON THE BASIS OF THE QUANTITY TO BE AWARDED, EXCLUSIVE OF THE OPTION QUANTITY. CONSISTENT WITH THIS PROVISION, THE GOVERNMENT SOLICITED FOR ITS ENTIRE KNOWN IDENTIFIED REQUIREMENT OF 5261 EACH. EVALUATION FOR AWARD WAS ON THE BASIS OF UNIT PRICES OFFERED BY BIDDERS ON THIS OR A LESSER QUANTITY. THE OPTION PRICE WAS NOT CONSIDERED IN DECIDING TO AWARD THE QUANTITY OF 4916 EACH. THIS CASE IS THUS DISTINGUISHABLE FROM THOSE WHERE THE GOVERNMENT DID NOT PROPERLY SOLICIT FOR ITS KNOWN FIRM REQUIREMENTS, SUCH AS EAST WIND INDUSTRIES, INC. - RECONSIDERATION, B-193720, 79-2 CPD 152, OR WHERE EVALUATION FOR THE BASIC AWARD INCLUDED THE PRICE OFFERED ON THE OPTION QUANTITY. THE LOWEST PRICE WAS OBTAINED SOLICITING ON THE ENTIRE GOVERNMENT REQUIREMENT AND THE AWARDS CONTEMPLATED ARE CONSISTENT WITH THE REQUIREMENTS OF THE COMPETITIVE BIDDING SYSTEM AND THE BEST INTERESTS OF THE GOVERNMENT."

THE COMMAND FURTHER ARGUES THAT SINCE THE ADDITIONAL QUANTITY OF NEEDED UNITS (345) "IS AN UNECONOMICAL PRODUCTION RUN FOR A SEPARATE CONTRACT AND ALL OTHER BIDDERS ARE AT HIGHER PRICES FOR THE ADDITIONAL QUANTITY IT IS IN THE GOVERNMENT'S BEST INTEREST TO EXERCISE THE OPTION IN GENERAL'S PROPOSED CONTRACT TO ADD THIS SMALL QUANTITY."

WE CANNOT QUESTION THE COMMAND'S POSITION THAT THE OPTION QUANTITY WAS NOT PART OF ITS "KNOWN FIRM REQUIREMENT" OF 5,261 UNITS. GIVEN THIS CIRCUMSTANCE, AND SINCE THE IFB PERMITTED BIDDERS TO BID PROPERLY ON LESS THAN THE TOTAL QUANTITY SUBMITTED, WE HAVE NO LEGAL OBJECTION TO THE COMMAND'S PROPOSAL TO OBTAIN THE BENEFIT OF GENERAL'S LOW OPTION PRICE ONCE THE CONTRACT IS AWARDED. INDEED, TO THE EXTENT THAT CONTRACT IS OBJECTING TO THE IFB PROVISIONS WHICH PROVIDED AN OPTION REQUIREMENT AND PERMITTED BIDDERS TO BID ON LESS THAN THE TOTAL QUANTITY SOLICITED, THIS ASPECT OF ITS PROTEST IS UNTIMELY FILED. SEE 4 C.F.R. SEC. 20.2(B)(1) (1980).

ACCORDINGLY, CONTRACT'S PROTEST IS DENIED.