B-218055, APR 22, 1985, 64 COMP.GEN. 482

B-218055: Apr 22, 1985

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CONTRACTS - PROTESTS - INTERESTED PARTY REQUIREMENT - NONRESPONSIVE BIDDER THE FACT THAT THE PROTESTER MAY HAVE SUBMITTED A NONRESPONSIVE BID DOES NOT PREVENT THE PROTESTER FROM BEING CONSIDERED AN INTERESTED PARTY WHERE THE PROTESTER SEEKS RESOLICITATION OF A PROCUREMENT ALLEGEDLY CONDUCTED ON THE BASIS OF DEFECTIVE SPECIFICATIONS AND WOULD HAVE THE OPPORTUNITY TO REBID IF THE REQUIREMENT IS RESOLICITED. CONTRACTS - AWARDS - ERRONEOUS - REMEDY - TERMINATION NOT RECOMMENDED - CRITERIA APPLIED A CONTRACT AWARDED ON THE BASIS OF DEFECTIVE SPECIFICATIONS SHOULD NOT BE TERMINATED AND THE REQUIREMENT RESOLICITED WHERE NO COMPETITIVE PREJUDICE TO ANY BIDDER IS APPARENT AND THE GOVERNMENT MET ITS MINIMUM NEEDS AT REASONABLE PRICES AFTER ADEQUATE COMPETITION.

B-218055, APR 22, 1985, 64 COMP.GEN. 482

CONTRACTS - PROTESTS - INTERESTED PARTY REQUIREMENT - NONRESPONSIVE BIDDER THE FACT THAT THE PROTESTER MAY HAVE SUBMITTED A NONRESPONSIVE BID DOES NOT PREVENT THE PROTESTER FROM BEING CONSIDERED AN INTERESTED PARTY WHERE THE PROTESTER SEEKS RESOLICITATION OF A PROCUREMENT ALLEGEDLY CONDUCTED ON THE BASIS OF DEFECTIVE SPECIFICATIONS AND WOULD HAVE THE OPPORTUNITY TO REBID IF THE REQUIREMENT IS RESOLICITED. CONTRACTS - AWARDS - ERRONEOUS - REMEDY - TERMINATION NOT RECOMMENDED - CRITERIA APPLIED A CONTRACT AWARDED ON THE BASIS OF DEFECTIVE SPECIFICATIONS SHOULD NOT BE TERMINATED AND THE REQUIREMENT RESOLICITED WHERE NO COMPETITIVE PREJUDICE TO ANY BIDDER IS APPARENT AND THE GOVERNMENT MET ITS MINIMUM NEEDS AT REASONABLE PRICES AFTER ADEQUATE COMPETITION.

MATTER OF: BIG STATE ENTERPRISES, APRIL 22, 1985:

BIG STATE ENTERPRISES PROTESTS THE AWARD OF A CONTRACT TO JLS RENTALS BY THE DEPARTMENT OF THE AIR FORCE UNDER INVITATION FOR BIDS (IFB) NO. F41685 -84-B-0023 FOR THE RENTAL AND MAINTENANCE OF CLOTHES WASHERS AND DRYERS. BIG STATE CONTENDS THAT THE WASHERS OFFERED BY JLS AND ACCEPTED BY THE AGENCY DO NOT COMPLY WITH THE SPECIFICATIONS, AND THAT THE SPECIFICATIONS ARE IMPOSSIBLE TO MEET AND DID NOT REFLECT THE AGENCY'S ACTUAL NEEDS. THE PROTESTER ASSERTS THAT THE CONTRACT AWARDED TO JLS SHOULD THEREFORE BE TERMINATED FOR THE CONVENIENCE OF THE GOVERNMENT AND THE REQUIREMENT RESOLICITED.

WE DENY THE PROTEST.

THE AGENCY CONTENDS THAT BIG STATE'S BID WAS NONRESPONSIVE FOR FAILURE TO ACKNOWLEDGE RECEIPT OF A MATERIAL SOLICITATION AMENDMENT, AND THAT BIG STATE THEREFORE IS NOT AN INTERESTED PARTY TO HAVE ITS PROTEST REVIEWED BY OUR OFFICE. WE DISAGREE. ASSUMING THAT THE BID WAS NONRESPONSIVE AND NOT ELIGIBLE FOR AWARD UNDER THE SOLICITATION, THAT DOES NOT AUTOMATICALLY PRECLUDE BIG STATE FROM BEING CONSIDERED AN INTERESTED PARTY. WHERE, AS HERE, THE PROTESTER SEEKS RESOLICITATION OF A PROCUREMENT ALLEGEDLY CONDUCTED ON THE BASIS OF DEFECTIVE SPECIFICATIONS, IT IS AN INTERESTED PARTY SINCE IF IT PREVAILS, IT WOULD HAVE AN OPPORTUNITY TO BID UNDER THE RESOLICITATION. SEE OLYMPIA USA, INC., B-216509, NOV. 8, 1984, 84-2 CPD PARA. 513. THEREFORE, WE WILL REVIEW THE MERITS OF BIG STATE'S PROTEST.

THE IFB SPECIFICATIONS REQUIRED HEAVY-DUTY, COMMERCIAL-TYPE WASHERS WITH AN 18 POUND TUB CAPACITY, AND SPECIFICALLY STATED THAT HOUSEHOLD TYPE AND COIN-OPERATED MACHINES WOULD NOT BE ACCEPTABLE. THE WASHERS ALSO HAD TO HAVE BUILT-IN, SELF-CLEANING LINT FILTERS. OF THE FOUR BIDS RECEIVED, THAT OF BIG STATE, THE INCUMBENT CONTRACTOR, WAS SECOND LOW AND THAT OF JLS WAS THE LOWEST. NEITHER TOOK ANY EXCEPTIONS TO THE SPECIFICATIONS.

AFTER BID OPENING, THE AGENCY, BIG STATE, AND JLS FOR THE FIRST TIME BECAME AWARE OF THE FACT THAT THE SPECIFICATION REQUIREMENT FOR AN 18 POUND TUB CAPACITY WAS DEFECTIVE BECAUSE THE CAPACITY OF WASHERS HAS BEEN RATED BY THE MANUFACTURERS SINCE 1977 IN TERMS OF CUBIC FEET, RATHER THAN IN POUNDS. THIS RESULTED FROM A RULE ISSUED BY THE FEDERAL ENERGY ADMINISTRATION THAT PRESCRIBED TEST PROCEDURES TO BE USED BY MANUFACTURERS IN DETERMINING THE ENERGY EFFICIENCY OF THEIR WASHER. /1/ NEVERTHELESS, THE AGENCY DETERMINED THAT IT WOULD BE LESS PREJUDICIAL TO THE BIDDERS WHOSE PRICES HAD BEEN EXPOSED TO PROCEED WITH THE AWARD THAN IT WOULD BE TO RESOLICIT. THE AWARD WAS MADE TO JLS ON JANUARY 17 AND BIG STATE'S PROTEST WAS RECEIVED BY OUR OFFICE ON JANUARY 24.

IN ADDITION, AFTER THE AWARD, THE AGENCY DISCOVERED THAT THE WASHERS FURNISHED BY JLS DID NOT HAVE THE SPECIFIED SELF-CLEANING FILTERS. THE AGENCY FOUND THAT THE LINT FILTERS WERE NONESSENTIAL SINCE EVEN THE BEST ARE ONLY 15 PERCENT EFFECTIVE AND WASHING CAN REASONABLY BE DONE WITHOUT THEM. IT CONCLUDED THAT CONTRACT TERMINATION WAS NOT NECESSARY BECAUSE THE CONTRACT WAS NOT AWARDED WITH THE INTENT TO MODIFY IT, AND THE WASHERS MEET ITS MINIMUM NEEDS.

THE FEDERAL ACQUISITION REGULATION (FAR) PROVIDES THAT THE PRESERVATION OF THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM DICTATES THAT AFTER BID OPENING, AWARD MUST BE MADE TO THE RESPONSIBLE BIDDER WITH THE LOWEST, RESPONSIVE BID, UNLESS THERE IS A COMPELLING REASON FOR NOT DOING SO. 48 C.F.R. SEC. 14.404-1(A)(1) (1984). INADEQUATE OR AMBIGUOUS SPECIFICATIONS IS ONE OF THE BASES ON WHICH A CONTRACTING OFFICER MAY DETERMINE TO CANCEL A SOLICITATION AFTER BID OPENING. 48 C.F.R. SEC. 14.404-1(C). THE USE OF INADEQUATE SPECIFICATIONS, HOWEVER, DOES NOT ITSELF PROVIDE A COMPELLING REASON TO CANCEL A SOLICITATION AND RESOLICIT. IF ACCEPTANCE OF A BID WILL SATISFY THE GOVERMMENT'S NEEDS WITHOUT PREJUDICE TO ANY BIDDER, AWARD SHOULD BE MADE NOTWITHSTANDING THE DEFICIENCY. DUNLIN CORP., B-207964, JAN. 4, 1983, 83-1 CPD SEC. 7. THE CONTRACTING OFFICER'S DECISION AS TO WHETHER THE CIRCUMSTANCES WARRANT CANCELLATION WILL NOT BE DISTURBED BY OUR OFFICE UNLESS THAT DECISION WAS ARBITRARY, CAPRICIOUS OR NOT SUPPORTED BY SUBSTANTIAL EVIDENCE. CHAMBERLAIN MFG. CORP., B-209187, MAR. 10, 1983, 83-1 CPD PARA. 243.

ON THE BASIS OF THE FACTS PRESENTED HERE, WE HAVE NO REASON TO QUESTION THE REASONABLENESS OF THE AGENCY'S DECISION TO PROCEED WITH THE AWARD AFTER DISCOVERING THE DEFICIENCY IN THE SPECIFICATION REQUIREMENT FOR AN 18 POUND TUB CAPACITY. ALTHOUGH BIG STATE ASSERTS THAT IT WAS PREJUDICED BY THIS DECISION BECAUSE IT COULD HAVE OFFERED CHEAPER MACHINES AT A LOWER PRICE IF IT DID NOT HAVE TO MEET THE 18 POUND CAPACITY REQUIREMENT, WE ARE NOT PERSUADED BY THIS CONTENTION. BIG STATE CONCEDES THAT WASHERS WITH CAPACITY EXPRESSED IN POUNDS ARE NO LONGER AVAILABLE AND THAT THERE IS NO MEANINGFUL WAY THAT CAPACITY EXPRESSED IN CUBIC FEET CAN BE CONVERTED TO ITS EQUIVALENT IN POUNDS. THUS, BIG STATE'S BID COULD NOT HAVE BEEN BASED ON SUPPLYING WASHERS WITH TUB CAPACITIES OF 18 POUNDS, AND THERE IS NO BASIS FOR CONCLUDING THAT BIG STATE WAS UNIQUELY PREJUDICED BY THE SOLICITATION DEFECT HERE. FURTHER, THE AGENCY OBTAINED ADEQUATE COMPETITION, REASONABLE PRICES AND WASHERS WHICH MEET ITS MINIMUM NEEDS. ACCORDINGLY, WE BELIEVE THAT IN SPITE OF THE SPECIFICATION DEFICIENCY, THE DETERMINATION TO MAKE AN AWARD WAS REASONABLE AND LESS OF A COMPROMISE TO THE COMPETITIVE BIDDING SYSTEM THAN RESOLICITATION AFTER EXPOSURE OF ALL PRICES WOULD HAVE BEEN. SEE GAF CORP. ET AL., 53 COMP.GEN. 586 (1974), 74-1 CPD PARA. 68.

WITH RESPECT TO BIG STATE'S CONTENTION THAT THE LACK OF SELF CLEANING LINT FILTERS ON THE JLS MACHINES REQUIRES RESOLICITATION, WE NOTE THAT THE FACT THAT JLSA' WASHERS DID NOT HAVE SELF-CLEANING FILTERS WAS NOT KNOWN TO THE AGENCY UNTIL AFTER THE CONTRACT AWARD. THEREFORE, THE DECISION AS TO WHETHER THE CONTRACT SHOULD BE MODIFIED RATHER THAN TERMINATED INVOLVES A MATTER OF CONTRACT ADMINISTRATION. WE DO NOT REVIEW CONTRACT ADMINISTRATION MATTERS EXCEPT IN LIMITED CIRCUMSTANCES NOT PRESENT HERE. SEE BVI ENGRAVERS, INC., B-208830, OCT. 20, 1982, 82-2 CPD PARA. 351.

THE PROTEST IS DENIED.

/1/ THOSE REQUIREMENTS ARE NOW FOUND IN THE REGULATIONS OF THE DEPARTMENT OF ENERGY. 10 CFR PART 430 (1984).