B-217070, APR 17, 1985, 85-1 CPD 437

B-217070: Apr 17, 1985

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WHERE PROTESTER ORALLY CONVEYS TO THE CONTRACTING OFFICER ITS CONCERN THAT THE SPECIFICATIONS ARE DEFECTIVE AND SHOULD BE CORRECTED. SINCE PROTEST TO AGENCY WAS TIMELY FILED AND SUBSEQUENT PROTEST TO GAO WAS FILED WITHIN 10 DAYS OF AGENCY'S CONFIRMATION OF ITS REQUIREMENTS. MATTER IS TIMELY PRESENTED TO GAO UNDER BID PROTEST PROCEDURES. PROTEST THAT SPECIFICATIONS DO NOT REPRESENT THE ACTUAL NEEDS OF THE GOVERNMENT IS DENIED WHERE RECORD SHOWS THAT SOLICITATION REQUIREMENTS ARE REASONABLY RELATED TO THE AGENCY'S NEEDS AND THAT BIDDERS WERE PROVIDED WITH AN ADEQUATE BASIS TO SUBMIT WELL-INFORMED BIDS. SPECIFICATIONS ARE NOT RENDERED MATERIALLY DEFECTIVE BECAUSE OF MINOR ERRORS WHICH HAVE NOT BEEN SHOWN TO HAVE MISLED PROTESTER OR ANY OTHER BIDDER.

B-217070, APR 17, 1985, 85-1 CPD 437

CONTRACTS - PROTESTS - GENERAL ACCOUNTING OFFICE PROCEDURES - TIMELINESS OF PROTEST - ADVERSE AGENCY ACTION EFFECT DIGEST: 1. WHERE PROTESTER ORALLY CONVEYS TO THE CONTRACTING OFFICER ITS CONCERN THAT THE SPECIFICATIONS ARE DEFECTIVE AND SHOULD BE CORRECTED, COMMUNICATION BETWEEN THE PROTESTER AND THE CONTRACTING OFFICER SUFFICES AS PROTEST TO CONTRACTING AGENCY. CONSEQUENTLY, SINCE PROTEST TO AGENCY WAS TIMELY FILED AND SUBSEQUENT PROTEST TO GAO WAS FILED WITHIN 10 DAYS OF AGENCY'S CONFIRMATION OF ITS REQUIREMENTS, MATTER IS TIMELY PRESENTED TO GAO UNDER BID PROTEST PROCEDURES. BIDS - INVITATION FOR BIDS - SPECIFICATIONS - MINIMUM NEEDS REQUIREMENT - ADMINISTRATIVE DETERMINATION - REASONABLENESS 2. PROTEST THAT SPECIFICATIONS DO NOT REPRESENT THE ACTUAL NEEDS OF THE GOVERNMENT IS DENIED WHERE RECORD SHOWS THAT SOLICITATION REQUIREMENTS ARE REASONABLY RELATED TO THE AGENCY'S NEEDS AND THAT BIDDERS WERE PROVIDED WITH AN ADEQUATE BASIS TO SUBMIT WELL-INFORMED BIDS. THE MERE PRESENCE OF RISK IN A SOLICITATION DOES NOT MAKE THE SOLICITATION INAPPROPRIATE, AND SPECIFICATIONS ARE NOT RENDERED MATERIALLY DEFECTIVE BECAUSE OF MINOR ERRORS WHICH HAVE NOT BEEN SHOWN TO HAVE MISLED PROTESTER OR ANY OTHER BIDDER. BIDS - PREPARATION - COSTS - NONCOMPENSABLE 3. CLAIM FOR BID PREPARATION COSTS IS DENIED WHERE PROTEST HAS BEEN FOUND TO BE WITHOUT MERIT AND BECAUSE CLAIMANT NEVER SUBMITTED A BID UNDER PROTESTED PROCUREMENT. CONTRACTS - PROTESTS - PREPARATION - COSTS - NONCOMPENSABLE 4. CLAIMS FOR COSTS OF PURSUING PROTEST, INCLUDING ATTORNEY'S FEE, ARE DENIED. COMPETITION IN CONTRACTING ACT OF 1984, UNDER WHICH CLAIMS ARE MADE, DOES NOT APPLY TO PROTEST FILED BEFORE JANUARY 15, 1985.

AARON REFRIGERATION SERVICES:

AARON REFRIGERATION SERVICES (AARON) PROTESTS VARIOUS PORTIONS OF THE SPECIFICATIONS IN INVITATION FOR BIDS (IFB) N62472-84-B-9201 ISSUED BY THE NAVAL FACILITIES ENGINEERING COMMAND (NAVY) FOR HOUSING HEATING, VENTILATING AND AIR-CONDITIONING MAINTENANCE AT THE PHILADELPHIA NAVAL BASE. IN ADDITION, AARON CLAIMS BID PREPARATION COSTS AND COSTS OF PURSUING THE PROTEST.

WE DENY THE PROTEST AND CLAIMS.

AARON PROTESTS THAT AS A RESULT OF ITS ON SITE INVESTIGATION AT THE PHILADELPHIA NAVAL BASE, IT FOUND THAT "THE IFB SPECIFICATIONS WERE MATERIALLY DEFECTIVE AS NOT MEETING THE ACTUAL AND TRUE NEEDS OF THE GOVERNMENT." AARON TELEPHONED THE CONTRACTING ACTIVITY ON NOVEMBER 5, 1984, TO STATE ITS OBJECTIONS AND THOSE OBJECTIONS FORM THE BASIS OF THE PRESENT PROTEST. FIRST, AARON STATES THAT THE IFB SPECIFICATIONS INCORRECTLY IDENTIFY THE 350 FURNACES IN THE NEW MUSTIN FIELD HOUSING UNITS AS DAY-NIGHT BRAND, WHEN NOT ALL UNITS ARE THAT BRAND AND, HENCE, THEY WOULD REQUIRE DIFFERENT PARTS AND MAINTENANCE. IN REVIEWING THIS CONTENTION, THE NAVY FOUND THAT WHILE NOT ALL OF THE FURNACES ARE DAY NIGHT BRAND, THEY ARE ALL GAS-FIRED AND, CONSEQUENTLY, HAVE THE SAME SERVICING REQUIREMENTS.

NEXT, AARON ASSERTS THAT THE ELECTRIC HEAT SYSTEMS AND OLD AIR CONDITIONING SYSTEMS IN THE MUSTIN FIELD BRICK UNITS WILL BE REPLACED WITH NEW GAS-FIRED FURNACES AND NEW AIR-CONDITIONING SYSTEMS, THUS CHANGING THE AMOUNT AND TYPE OF MAINTENANCE REQUIRED. HERE, THE NAVY DETERMINES THAT THE INSTALLATION DATES FOR THE NEW HEATING AND AIR CONDITIONING UNITS ARE UNKNOWN BECAUSE THE CITY MUST FIRST INSTALL GAS LINES AND BECAUSE NOT ALL NEW UNITS WILL COME ON LINE AT THE SAME TIME. THUS, REPAIR AND SERVICE OF THE EXISTING ELECTRIC HEAT SYSTEMS WILL BE REQUIRED FOR AN INDEFINITE PERIOD UNTIL REPLACEMENT OF OLD UNITS IS COMPLETE.

FINALLY, AARON ALLEGES THAT THE SPECIFICATIONS INCORRECTLY IDENTIFY THE MODEL NUMBER AND QUANTITY OF FURNACES AND AIR-CONDITIONING SYSTEMS IN THE CAPEHART HOUSING UNITS. THE NAVY ACKNOWLEDGES THAT WHILE THREE MODEL NUMBERS CONTAINED TYPOGRAPHICAL ERRORS, THE INCORRECT NUMBERS, IN FACT, DID NOT REPRESENT A DIFFERENT MODEL OF THE MANUFACTURER. THE NAVY WAS DETERMINED THAT WHILE TWO HOMES HAD FURNACES MANUFACTURED BY A COMPANY DIFFERENT FROM THE ONE IDENTIFIED IN THE SPECIFICATIONS, THE COST RANGE FOR MAINTENANCE WILL BE THE SAME.

ON THE BASIS OF THESE FINDINGS, THE NAVY DETERMINED THAT THERE WAS NOT A SIGNIFICANT CHANGE REFLECTED AS FAR AS BIDDING COSTS WERE CONCERNED. MOREOVER, SINCE EMERGENCY SERVICE FOR BASE HOUSING WAS BEING ACCOMPLISHED BY MEANS OF SMALL PURCHASE CONTRACTS AND REGULAR MAINTENANCE SERVICES WERE BEING DEFERRED, AND IN VIEW OF THE CRITICAL NEED IN THE WINTER SEASON FOR CONTINUING SERVICE TO FAMILY HOUSING UNITS, THE NAVY DETERMINED THAT DELAY OF THE SCHEDULED BID OPENING TO CORRECT THE SPECIFICATIONS WAS UNNECESSARY.

THE NAVY POINTS OUT THAT, ALTHOUGH AARON EXPRESSED ITS CONCERNS TO THE CONTRACTING ACTIVITY TELEPHONICALLY ON NOVEMBER 5, 1984, 3 DAYS PRIOR TO BID OPENING, THE NAVY ADVISED AARON ON NOVEMBER 7 THAT IT HAD DETERMINED THAT THE SPECIFICATIONS WERE ADEQUATE AND THAT BID OPENING NEED NOT BE POSTPONED. BIDS WERE OPENED AS SCHEDULED AT 2 P.M. ON NOVEMBER 8, AND THIS OFFICE RECEIVED AARON'S PROTEST LETTER AT 3:08 P.M. ON THE SAME DATE. THUS, THE NAVY CONTENDS THAT, SINCE THE PROTEST ALLEGES SPECIFICATION IMPROPRIETIES AND THERE WAS NO WRITTEN PROTEST TO THE NAVY PRIOR TO BID OPENING, THE PROTEST SHOULD BE DISMISSED AS UNTIMELY PURSUANT TO SEC. 21.2 (B)(1) OF OUR BID PROTEST PROCEDURES (4 C.F.R. PART 21 (1984)), WHICH PROVIDES THAT A PROTEST BASED ON ALLEGED IMPROPRIETIES IN THE SOLICITATION WHICH ARE APPARENT PRIOR TO BID OPENING SHALL BE FILED PRIOR TO BID OPENING.

AARON COUNTERS THAT IN CONVERSATIONS WITH THE NAVY ON NOVEMBER 5, 6, AND THE MORNING OF BID OPENING ON NOVEMBER 8, IT MADE IT CLEAR TO THE NAVY THAT UNLESS AN IFB AMENDMENT WAS ISSUED TO CORRECT THE SPECIFICATIONS, IT WAS PROTESTING THE BID OPENING AND ANY CONTRACT THAT MIGHT BE AWARDED. AARON EMPHASIZES THAT THE ALLEGED DEFECTS IN THE SPECIFICATIONS IT NOTED DURING ITS ON SITE INVESTIGATION AT THE PHILADELPHIA NAVAL BASE WERE COMMUNICATED TO THE NAVY IN THREE SEPARATE TELEPHONE CALLS ON NOVEMBER 5, 6, AND 8, AND THAT UNTIL BID OPENING ON NOVEMBER 8, AARON FIRMLY BELIEVED THAT THE NAVY WAS GOING TO TAKE THE CORRECTIVE ACTION IT SOUGHT BY ISSUING AN IFB AMENDMENT THAT WOULD INCLUDE AN EXTENSION OF THE BID OPENING DATE.

IT IS UNDISPUTED THAT ON NOVEMBER 5, AARON TELEPHONED THE NAVY AND TOLD THE NAVY THAT IT CONSIDERED THE SPECIFICATIONS TO BE DEFECTIVE CONCERNING ACTUAL QUANTITIES REQUIRED, THE PROPER TYPES OF EQUIPMENT TO BE MAINTAINED, AND THE SCOPE OF WORK ACTUALLY NEEDED. IN THIS REGARD, WE HAVE HELD THAT THE INTENT TO PROTEST MAY BE CONVEYED BY AN EXPRESSION OF DISSATISFACTION AND A REQUEST FOR CORRECTIVE ACTION. WORLDWIDE MARINE, INC., B-212640, FEB. 7, 1984, 84-1 CPD PARA. 152. IN OUR VIEW, THE RECORD CLEARLY SHOWS THAT AARON CONVEYED ON NOVEMBER 5 ITS DISSATISFACTION WITH THE SPECIFICATIONS AND ITS BELIEF THAT THE SOLICITATION SHOULD BE CLARIFIED. THEREFORE, WE CONCLUDE THAT AARON FILED A TIMELY PROTEST WITH THE NAVY UNDER SECTION 21.2(B)(1) OF OUR BID PROTEST PROCEDURES, AND ITS SUBSEQUENT PROTEST TO THIS OFFICE, FILED WITHIN 10 WORKING DAYS OF THE AGENCY'S CONFIRMATION OF ITS REQUIREMENTS, IS A TIMELY APPEAL UNDER SECTION 21.2(A) OF OUR PROCEDURES, OF THE CONTRACTING AGENCY'S ADVERSE ACTION ON THE PROTEST AT THAT LEVEL. WORLDWIDE MARINE, INC., B-212640, SUPRA.

TURNING TO THE MERITS OF AARON'S PROTEST, THAT THE SPECIFICATIONS WERE MATERIALLY DEFECTIVE AS NOT MEETING THE TRUE NEEDS OF THE GOVERNMENT, THE RESPONSIBILITY FOR DRAFTING PROPER SPECIFICATIONS TO MEET THE GOVERNMENT'S MINIMUM NEEDS IS THE CONTRACTING AGENCY'S. RACK ENGINEERING COMPANY, B-208615, MAR. 10, 1983, 83-1 CPD PARA. 242. THE SPECIFICATIONS MUST BE UNAMBIGUOUS, STATE THE NEEDS ACCURATELY, AND PROVIDE FOR EQUAL COMPETITION. MEMOREX CORPORATION, B-212660, FEB. 7, 1984, 84-1 CPD PARA. 153. THE FACT THAN AN AGENCY HAS NOT DETAILED EVERY FACET OF HOW PERFORMANCE IS TO BE ACHIEVED DOES NOT RENDER THE SPECIFICATION INADEQUATE FOR COMPETITION. INDUSTRIAL MAINTENANCE SERVICES, IN., B-207949, SEPT. 29, 1982, 82-2 CPD PARA. 296 AT 5. THERE IS NO LEGAL REQUIREMENT THAT COMPETITION BE BASED ON SPECIFICATIONS WHICH STATE WORK IN SUCH DETAIL SO AS TO COMPLETELY ELIMINATE THE POSSIBILITY THAT THE CONTRACTOR WILL BE REQUIRED TO PERFORM WORK OTHER THAN THAT SPECIFIED IN THE SOLICITATION. DIESEL ELECTRIC SALES & SERVICE, INC., B-206922, JUL. 27, 1982, 82-2 CPD PARA. 84, CITING KLEIN-SIEB ADVERTISING AND PUBLIC RELATIONS, INC., B-200399, SEPT. 28, 1981, 81-2 CPD PARA. 251.

WE HAVE FURTHER STATED THAT THE FACT THAT SOME OF THE TERMS OF AN INVITATION ARE IN SOME WAY DEFICIENT DOES NOT, OF ITSELF, CONSTITUTE A COMPELLING REASON TO CANCEL A SOLICITATION. DYNETERIA, INCORPORATED; TECOM, INCORPORATED, B-210684; B-210684.2, DEC. 21, 1983, 84-1 CPD PARA. 10. THUS, A CONTRACT AWARD MAY BE MADE EVEN WHERE THERE ARE DEFICIENCIES IN THE SPECIFICATIONS IN THE ABSENCE OF A SHOWING OF COMPETITIVE PREJUDICE AND AWARD WOULD SERVE THE ACTUAL NEEDS OF THE GOVERNMENT. GAF CORPORATION, ET. AL., 53 COMP.GEN. 586 (1974), 74-1 CPD PARA. 68; HILD FLOOR MACHINE CO., INC., B-196419, FEB. 19, 1980, 80-1 CPD PARA. 140.

IN OUR VIEW, THE SPECIFICATIONS SET FORTH IN THE SOLICITATION ADEQUATELY STATE THE NAVY'S NEEDS. THE NAVY ADMITS THAT THREE FURNACE AND AIR- CONDITIONING SYSTEM MODEL NUMBERS CONTAINED TYPOGRAPHICAL ERRORS, TWO OF THE 350 FURNACES IN THE NEW MUSTIN FIELD HOUSING UNITS WERE NOT THE "DAY- NIGHT" BRAND LISTED IN THE SPECIFICATIONS, AND CERTAIN OF THE HEAT AND AIR -CONDITIONING UNITS WOULD BE REPLACED AFTER THE CITY INSTALLS GAS LINES. THE NAVY DETERMINED THAT THE OVERALL IMPACT OF THESE DEFICIENCIES WAS MINIMAL, THAT SIMILAR SERVICING REQUIREMENTS WOULD BE REQUIRED AND THE COST RANGE FOR MAINTENANCE WOULD BE THE SAME. THUS, THE NAVY DETERMINED THAT ALL POTENTIAL BIDDERS WOULD BE EQUALLY EFFECTED AND COULD TAKE SUCH RELATIVELY MINOR UNCERTAINTIES INTO ACCOUNT IN COMPUTING THEIR BIDS. HERE, PROSPECTIVE BIDDERS BASICALLY WERE ON NOTICE OF WHAT WOULD BE EXPECTED OF THEM DURING CONTRACT PERFORMANCE AND, PRESUMABLY, EACH IS KNOWLEDGEABLE ENOUGH TO RECOGNIZE THE EFFORT AND RISKS ASSOCIATED WITH THAT EXPECTATION. TALLY SUPPORT SERVICES, INC., B-209232, JUNE 27, 1983, 83-2 CPD PARA. 22. THE MERE PRESENCE OF RISK IN A PROCUREMENT DOES NOT MAKE THE COMPETITION IMPROPER, INDUSTRIAL MAINTENANCE SERVICES, INC., B-207949, SUPRA; NOR DO MINOR DEFICIENCIES IN THE DRAFTING OF SPECIFICATIONS REQUIRE THE CANCELLATION OF A SOLICITATION WHERE BIDDERS HAD AN ADEQUATE BASIS FOR THE PREPARATION OF WELL-INFORMED BIDS, SAXON CORPORATION, B-214977, AUG. 21, 1984, 84-2 CPD PARA. 205, THE PERFORMANCE REQUIREMENTS ARE ESSENTIALLY THE SAME, DYNETERIA, INCORPORATED; TECOM, INCORPORATED, B-210684; B-210684.2, SUPRA, AND THE COST EFFECT IS MINIMAL. DUNLIN CORPORATION, B-207964, JAN. 4, 1983, 83-1 CPD PARA. 7. FURTHERMORE, THE FACT THAT THE NAVY RECEIVED FOUR BIDS AND NO BIDDER COMPLAINED ABOUT THE SPECIFICATIONS LEADS US TO BELIEVE THAT THE SMALL DEGREE OF UNCERTAINTY PRESENT HERE DID NOT PREJUDICE THE BIDDERS IN ANY SIGNIFICANT WAY.

WE ALSO DENY AARON'S PROTEST THAT IT HAS BEEN PREJUDICED BY THESE MINOR DEFICIENCIES IN THE SPECIFICATIONS, OR THAT IT WAS UNABLE TO BID ON THE BASIS OF INCORRECT OR INCOMPLETE SPECIFICATIONS, BECAUSE WE CANNOT CONCLUDE THAT THE PROTESTER HAS SUFFERED ANY ACTUAL PREJUDICE. SINCE AARON STATES THAT ITS PROTEST IS PREMISED ON ITS SITE EXAMINATION BEFORE BID OPENING AND ITS ACTUAL KNOWLEDGE OF THE CORRECT UNIT NOMENCLATURES, MODELS AND BRAND NAMES, IT CLEARLY WAS NOT REQUIRED TO GUESS AT THE CORRECT SPECIFICATIONS. FURTHER, THERE HAS BEEN NO SHOWING THAT THE MISIDENTIFICATION OF COMPARABLE EQUIPMENT ITEMS HAD A PREJUDICIAL IMPACT ON PRICES. IN THIS REGARD, AARON HAS NEITHER ALLEGED NOR SHOWN THAT BIDDERS WERE MISLED INTO BIDDING UNREALISTICALLY LOW PRICES THAT AARON COULD NOT HAVE MATCHED DUE TO ITS KNOWLEDGE OF THE CORRECT SPECIFICATIONS. SEE UNITED STATES CONTRACTING CORPORATION, B-210275, AUG. 22, 1983, 83-2 CPD PARA. 222. THE RECORD SIMPLY DOES NOT SUPPORT A FINDING THAT THE PROTESTER WAS PREJUDICED BY THE ALLEGEDLY DEFICIENT SPECIFICATION IN THIS CASE. IN ACCORD WITH THE ABOVE, WE DENY THE PROTEST.

ALTHOUGH AARON NEVER SUBMITTED A BID ON THIS PROCUREMENT, IT HAS ALSO REQUESTED BID PREPARATION AND PROTEST COSTS AS WELL AS ATTORNEY'S FEES UNDER THE COMPETITION IN CONTRACTING ACT OF 1984, PUB. L. NO. 98 369, TITLE VII, 98 STAT. 1175 (1984). HOWEVER, AMENDMENTS MADE TO THE PROCUREMENT PROTEST SYSTEM-- INCLUDING THE AWARD OF REASONABLE ATTORNEY'S FEES IN SPECIFIED CIRCUMSTANCES-- BY SUBTITLE "D" OF THE COMPETITION IN CONTRACTING ACT OF 1984 APPLY ONLY WITH RESPECT TO PROTESTS FILED AFTER JANUARY 14, 1985. AS AARON'S PROTEST WAS FILED IN THIS OFFICE ON NOVEMBER 8, 1984, IT IS NOT COVERED UNDER THE ACT. SAFEGUARD MAINTENANCE CORP., B-215588.2, NOV. 14, 1984, 84-2 CPD PARA. 532. APART FROM THIS NEW AUTHORITY, COSTS OTHER THAN BID PREPARATION COSTS MAY NOT BE AWARDED. SEE HUB TESTING LABORATORIES-- CLAIM FOR COSTS, B-199368.3, JUNE 18, 1982, 82-1 CPD PARA. 602. FOR EXAMPLE, ANTICIPATED PROFITS OR THE LEGAL FEES INCURRED IN PURSUING A BID PROTEST AT THE GENERAL ACCOUNTING OFFICE WERE NOT COMPENSABLE PRIOR TO THE ACT. HUB TESTING LABORATORIES-- CLAIM FOR COSTS, ID. THE STANDARD FOR ENTITLEMENT TO BID PREPARATION COSTS IS WHETHER THE PROCUREMENT AGENCY'S ACTIONS WITH RESPECT TO THE CLAIMANT'S BID WERE ARBITRARY AND CAPRICIOUS-- THAT IS, WERE NOT TAKEN IN GOOD FAITH, WERE CONTRARY TO LAW OR REGULATION, OR HAD NO REASONABLE BASIS-- AND, BUT FOR THOSE ACTIONS, THE CLAIMANT WOULD HAVE HAD A SUBSTANTIAL CHANCE OF RECEIVING THE AWARD. SEE DA NEAL CONSTRUCTION, INC., B-208469.3, DEC. 14, 1983, 83-2 CPD PARA. 682. IN VIEW OF OUR CONCLUSIONS ON THE MERITS OF AARON'S PROTEST AND BECAUSE AARON NEVER SUBMITTED A BID, AARON'S CLAIM FOR BID PREPARATION COSTS IS DENIED.