B-243730, Aug 6, 1991, 91-2 CPD ***

B-243730, Aug 6, 1991, 91-2 CPD ***

PROCUREMENT - Payment/Discharge - Shipment - Tenders - Applicability DIGEST: As provided in a freight forwarder's rate tender to the government, the tender does not apply where charges would exceed those otherwise applicable for the same service.

Davidson Forwarding Company:

Davidson Forwarding Company requests review of the General Services Administration's (GSA) audit actions on 27 Government Bill of Lading (GBL) transactions, involving the movement of military household goods from Fort Belvoir, Virginia, to Fort Polk, Louisiana. Davidson and GSA dispute which of two rate authorities is applicable to these movements. sustain GSA's audit actions.

Davidson issued Tender 328 pursuant to the Military Traffic Management Command's (MTMC) Volume Movement Solicitation 13-88. /1/ That solicitation requested rates for the movement of approximately 225,000 tons of household goods from Fort Belvoir to Fort Polk that were to be packed and picked up by participating carriers between June 13 and June 30, 1988. In Tender 328, Davidson offered a rate of 95 percent of the preestablished baseline rate, set out in MTMC Rate Solicitation 10, for both the underlying transportation and additional services. Davidson indicated on Tender 328 that it "can handle" 15,000 pounds of household goods a day and 60,000 tons during the period involved.

On audit, GSA applied Davidson's regular, nationwide rate tender, which covered the origin and destination installations involved, among other locations and which was valid during June 1988. /2/ That tender offered services at 75 percent of the baseline rate for underlying transportation and 100 percent for additional services. Application of that tender to each of the 27 transactions resulted in lower overall charges than those available under Tender 328.

Application of the nationwide tender is based on the standard alternation clause in Item 23 of Tender 328, which provides that the tender will not apply "where charges accruing herein exceed charges otherwise applicable for the same service. ..." Davidson, however, contends that services rendered in fulfillment of requirements under Solicitation 13-88 were different from services it offered under the general, nationwide tender. The reason, according to Davidson, is that the discount in Tender 328 included such items as reweighs and warehouse handling at destination, whereas those services were not included in the discount in the nationwide tender, but instead were paid for separately as additional services (at 100 percent). Davidson states that another difference is that it was required under the Volume Movement program to provide a firm commitment to move a specified amount of total tonnage in a compressed period of time, as well as a specific amount of tonnage per day.

We agree with GSA that alternation to the nationwide tender was proper. /3/

Alternation to the general tender is required under Item 23 of Tender 328 if the services and privileges offered to the United States under both tenders are substantially similar to each other. American Van & Storage, Inc., B-192951, May 9, 1979, aff'd, Mar. 17, 1980. There is no difference in service where one tender offers additional services at no extra charge and the other tariff or tender offers those services for an extra charge. 65 Comp.Gen. 563, 567 (1986); AA Sunshine, B-195219, Dec. 27, 1979. Accordingly, the offer of a discount in one tender for the same additional services that are not discounted in another tender does not make the services different within the meaning of the alternation clause. In that situation, the lowest total price for all services' offered is the one the alternation clause allows the government to use.

Davidson states that another reason different services are involved is that under Tender 328 Davidson was required to carry a specified tonnage over a short period, which is not the case under the nationwide tender.

We do not agree with Davidson. First, the actual service to the shipper is substantially the same in either instance. Second, while the traffic actually distributed to any carrier may be affected by the volume it can handle, nothing on the face of Tender 328 binds the government to ordering from Davidson, or the carrier to furnishing, a certain volume of traffic. The instructions for implementing the Volume Movement program, which were referenced in the Volume Movement announcement, provided that "acceptance of rates does not guarantee any offer of tonnage." The actual tonnage awarded to any carrier submitting a tender in response to the announcement depended on a combination of factors: price, capacity, and quality of service. See DoD Personal Property Traffic Management Regulation, 4500.34 -R, at 2-99 to 2-100 (C3, Dec. 1, 1987).

GSA's audit actions are sustained.

/1/ A volume movement generally involves the transportation of a large volume of household goods from one origin to one destination within a 90- day period.

/2/ MTMC generally obtains transportation services for domestic household goods shipments of Defense and Coast Guard members after soliciting individual carrier rate tenders (valid for a 6-month period) under a solicitation (e.g., MTMC Rate Solicitation 10) providing baseline rates and governing rules for operating the program.

/3/ The Military Traffic Management Command (MTMC) filed a report in this matter substantially agreeing with GSA.