B-99854, DECEMBER 12, 1950, 30 COMP. GEN. 235

B-99854: Dec 12, 1950

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SO THAT WHERE IT IS QUESTIONABLE WHETHER EQUIPMENT OFFERED BY A LOW BIDDER CAN MEET THE REQUIREMENTS OF ADVERTISED SPECIFICATIONS OR WHERE A LOW BIDDER HAS FAILED TO DEMONSTRATE HIS FITNESS AND ABILITY SUCCESSFULLY TO FULFILL THE CONTRACT REQUIREMENTS. 1950: I HAVE YOUR LETTER OF DECEMBER 1. PARAGRAPH 14 OF INSTRUCTIONS TO BIDDERS PROVIDES THAT THE CONTRACT WILL BE AWARDED TO THE LOWEST RESPONSIBLE BIDDER COMPLYING WITH THE INVITATION FOR BIDS PROVIDED HIS BID IS RESPONSIBLE AND IT IS IN THE INTEREST OF THE DISTRICT TO ACCEPT IT. "WILL BE CONSIDERED BY THE DISTRICT. THE QUALIFICATIONS OF THE BIDDER IN COMPARING BIDS AND AS A BASIS FOR DETERMINING THE BIDDER TO WHOM THE CONTRACT WILL BE AWARDED * * *.'.

B-99854, DECEMBER 12, 1950, 30 COMP. GEN. 235

BIDS - ACCEPTANCE OR REJECTION - BIDDER'S QUALIFICATIONS IN MAKING AN AWARD OF A CONTRACT AFTER ADVERTISING FOR PROPOSALS THE PUBLIC INTEREST REQUIRES THAT THE CONTRACT BE AWARDED ONLY TO THE LOWEST RESPONSIBLE BIDDER, WHICH NECESSITATES CONSIDERATION OF HIS FINANCIAL RESOURCES, JUDGMENT, ABLILITY, INTEGRITY, AND FITNESS SUCCESSFULLY TO FULFILL THE CONTRACT REQUIREMENTS, SO THAT WHERE IT IS QUESTIONABLE WHETHER EQUIPMENT OFFERED BY A LOW BIDDER CAN MEET THE REQUIREMENTS OF ADVERTISED SPECIFICATIONS OR WHERE A LOW BIDDER HAS FAILED TO DEMONSTRATE HIS FITNESS AND ABILITY SUCCESSFULLY TO FULFILL THE CONTRACT REQUIREMENTS, THE LOW BID MAY BE REJECTED AND AWARD MADE TO THE LOWEST RESPONSIBLE BIDDER.

COMPTROLLER GENERAL WARREN TO THE PRESIDENT, BOARD OF COMMISSIONERS OF THE DISTRICT OF COLUMBIA, DECEMBER 12, 1950:

I HAVE YOUR LETTER OF DECEMBER 1, 1950, REQUESTING ADVICE AS TO WHETHER, FOR THE REASONS STATED THEREIN, THIS OFFICE WOULD BE REQUIRED TO OBJECT TO THE APPROVAL BY THE BOARD OF COMMISSIONERS OF THE AWARD OF A CONTRACT TO COMBUSTION ENGINEERING-1SUPERHEATER, INC., WHICH SUBMITTED THE SECOND LOW BID FOR FURNISHING SLUDGE DRYING AND INCINERATING EQUIPMENT IN ACCORDANCE WITH AN INVITATION FOR BIDS ISSUED ON AUGUST 9, 1950.

THE DIRECTOR OF SANITARY ENGINEERING, DISTRICT OF COLUMBIA, ISSUED AN INVITATION FOR BIDS ON AUGUST 9, 1950, FOR FURNISHING ALL LABOR AND MATERIALS, FOR INSTALLING AND ERECTING, FOR TESTING, AND FOR PLACING IN SATISFACTORY OPERATION SLUDGE DRYING AND INCINERATING EQUIPMENT IN ACCORDANCE WITH THE DRAWINGS AND SPECIFICATIONS ATTACHED TO THE INVITATION. PARAGRAPH 14 OF INSTRUCTIONS TO BIDDERS PROVIDES THAT THE CONTRACT WILL BE AWARDED TO THE LOWEST RESPONSIBLE BIDDER COMPLYING WITH THE INVITATION FOR BIDS PROVIDED HIS BID IS RESPONSIBLE AND IT IS IN THE INTEREST OF THE DISTRICT TO ACCEPT IT. ALSO, PARAGRAPH 11 OF SPECIAL CONDITIONS PROVIDES THAT THE LOWEST BID, COMPUTED AND EVALUATED IN MANNER THEREIN DESCRIBED,"WILL BE CONSIDERED BY THE DISTRICT, TOGETHER WITH THE PRICE BID, AND THE QUALIFICATIONS OF THE BIDDER IN COMPARING BIDS AND AS A BASIS FOR DETERMINING THE BIDDER TO WHOM THE CONTRACT WILL BE AWARDED * * *.' PARAGRAPH 12 OF SAID SPECIAL CONDITIONS PROVIDES THAT BIDDERS MUST PRESENT SATISFACTORY EVIDENCE THAT THEY HAVE BEEN REGULARLY ENGAGED IN THE BUSINESS OF CONSTRUCTING SUCH WORK AS THEY PROPOSE TO EXECUTE, AND IN CASE THE LOWEST RESPONSIBLE BIDDER HAS NEVER DONE ANY WORK FOR THE DISTRICT OF COLUMBIA, HE MUST, PRIOR TO AWARD OF THE CONTRACT, BE ABLE TO SHOW WORK DONE BY HIM WITHIN THE CONTINENTAL UNITED STATES AND CANADA.

IN RESPONSE TO THE INVITATION, PROPOSALS WERE RECEIVED FROM THREE BIDDERS, THE LOWEST BID BEING THAT OF MORSE BOULGER DESTRUCTOR COMPANY, CONSISTING OF " ARRANGEMENT B" IN THE AMOUNT OF $691,446 AND " ARRANGEMENT A" IN THE AMOUNT OF $711,446. THE SECOND LOWEST BIDDER WAS COMBUSTION ENGINEERING-1SUPERHEATER, INC., WHICH SUBMITTED A BID IN THE AMOUNT OF $731.363.

IT IS POINTED OUT IN YOUR LETTER THAT THE DIRECTOR OF SANITARY ENGINEERING, IN HIS CAPACITY AS CONTRACTING OFFICER, HAS DETERMINED TO REJECT THE LOWEST BID AS TO PRICE AND MAKE AWARD TO THE SECOND LOWEST BIDDER, AND THAT THE REASONS FORMING THE BASIS OF THE ACTION TAKEN BY HIM ARE SET FORTH IN HIS MEMORANDUM OF DECEMBER 1, 1950, AND ACCOMPANYING PAPERS.

IT IS STATED BY THE CONTRACTING OFFICER THAT THE BID ON " ARRANGEMENT B," SUBMITTED AS AN ALTERNATE PROPOSAL BY THE LOW BIDDER, IS NOT ACCEPTABLE BECAUSE THE PROPOSAL INCLUDES INNOVATIONS CONTRARY TO THE SPECIFICATIONS AND WHICH ARE ENTIRELY NEW TO THE PROCESS OF SLUDGE DRYING. AS TO THE " ARRANGEMENT A" BID, SUBMITTED BY THE SAME BIDDER, THE CONTRACTING OFFICER STATES THAT AN ANALYSIS THEREOF INDICATES THAT IT DOES NOT CONFORM TO THE REQUIREMENTS OF SPECIFICATIONS FOR VARIOUS REASONS.

FIRST, THERE IS A FAILURE TO PROVIDE HYDRAULIC OR PNEUMATIC ASH HANDLING EQUIPMENT AS CALLED FOR IN THE SPECIFICATIONS AND AS SHOWN ON THE DRAWING ENTITLED " SLUDGE DRYING AND INCINERATING EQUIPMENT--- MULTIPLE HEARTH TYPE--- SECTION; " THAT INSTEAD OF THE ASH HOPPER, ASH SUMP, AND PUMP SHOWN OR REQUIRED BELOW THE FURNACE, MORSE BOULGER SUBSTITUTED A SCREW CONVEYOR AND BUCKET ELEVATOR DISCHARGING TO AN ASH HOPPER TO THE SIDE OF EACH INCINERATOR AND DRYING UNIT; AND THAT THIS SUBSTITUTE EQUIPMENT IS SUBJECT TO EXTREME WEAR AS WAS FOUND TO BE THE CASE WITH THE UNIT INSTALLED BY THE BIDDER AT LANSING, MICHIGAN, AND WOULD RESULT IN EXCESSIVE MAINTENANCE COSTS TO THE DISTRICT. SECONDLY, IT IS POINTED OUT THAT THE DATA SUPPORTING ITS BID STATE THAT THE MINIMUM DUST REQUIREMENTS IN THE STACK GASES, AS OUTLINED BY THE SPECIFICATIONS, WILL NOT WARRANT THE USE OF A DUST COLLECTOR FOR INCINERATOR OPERATION AND ALTHOUGH IT CAN BE USED IF DESIRED, IT HAS NOT BEEN INCLUDED IN THE OPERATING COSTS. FAILURE TO INCLUDE THE OPERATING COSTS IS CONTRARY TO THE REQUIREMENTS OF THE SPECIFICATIONS AND MAKES IT IMPOSSIBLE TO PROPERLY EVALUATE THE BIDS. IN THE THIRD PLACE, IT IS POINTED OUT THAT THE LOW BIDDER FAILED TO MEET THE REQUIREMENTS ON PAGE S-16 OF THE SPECIFICATIONS IN THAT IT DID NOT SUBMIT A STATEMENT AND SUBSTANTIATING EVIDENCE THAT THE EQUIPMENT PROPOSED TO BE FURNISHED WILL SATISFACTORILY DRY AND INCINERATE DEWATERED DIGESTED COMBINED SLUDGE AFTER THE DISTRICT'S SECONDARY TREATMENT PLANT IS PLACED IN OPERATION. IN THE FOURTH PLACE, THE THERMAL EFFICIENCY FOR THE PROPOSED EQUIPMENT IS 49.6 PERCENT AND IN VIEW OF THE FACT THAT THE THERMAL EFFICIENCY SECURED DURING A TEST RUN AT THE LANSING PLANT WAS 46.1 PERCENT IT IS QUESTIONABLE WHETHER THE LOW BIDDER CAN MEET THE PROPOSED EFFICIENCY. FINALLY, IN VIEW OF THE FOREGOING REASONS AND THE FACT THAT SATISFACTORY EVIDENCE OF THE BIDDER'S EXPERIENCE HAS NOT BEEN SUBMITTED IN COMPLIANCE WITH PARAGRAPH 12 OF THE SPECIAL CONDITIONS, IT IS CONCLUDED THAT A SERIOUS QUESTION ARISES AS TO THE BIDDER'S QUALIFICATIONS IN THE FIELD OF SEWAGE SLUDGE DRYING, ESPECIALLY SINCE THE EVIDENCE SUBMITTED BY IT LISTS ONLY SIX INSTALLATIONS IN SEWAGE TREATMENT PLANTS AND, AS TO THESE, ONLY ONE IS KNOWN TO BE NOW OPERATING WITH DEWATERED SLUDGE AND THEN ONLY FOR DRYING THE PRODUCT TO A MOISTURE CONTENT OF ABOUT 20 PERCENT INSTEAD OF THE 6 PERCENT MOISTURE CONTENT REQUIRED BY THE SPECIFICATIONS. IT IS ADDED THAT ACTUALLY THE MORSE BOULGER DESTRUCTOR COMPANY HAS NEVER CONSTRUCTED A PLANT COMPARABLE TO THAT CALLED FOR IN THE PLANS AND SPECIFICATIONS HERE INVOLVED.

IT WOULD APPEAR FROM THE REPORT THUS FURNISHED BY THE CONTRACTING OFFICER THAT THE PLANT OFFERED BY THE LOW BIDDER FAILS TO MEET THE SPECIFICATIONS. HOWEVER, IN ADDITION AND EQUALLY IMPORTANT IS THE QUESTION OF WHETHER THE LOW BIDDER HAS DEMONSTRATED ITS FITNESS AND ABILITY TO SUCCESSFULLY FULFILL THE CONTRACT REQUIREMENTS. IN MAKING AN AWARD AFTER ADVERTISING FOR PROPOSALS, THE PUBLIC INTEREST REQUIRES THAT THE CONTRACT BE AWARDED ONLY TO THE LOWEST RESPONSIBLE BIDDER, AND IN MAKING DETERMINATION AS TO WHETHER A BIDDER IS RESPONSIBLE, NOT ONLY ARE FEDERAL AND MUNICIPAL OFFICERS REQUIRED TO CONSIDER HIS FINANCIAL RESOURCES BUT ALSO THE JUDGMENT, ABILITY, AND INTEGRITY OF THE BIDDER AND TO INQUIRE AS TO HIS FITNESS AND ABILITY SUCCESSFULLY TO FULFILL THE CONTRACT REQUIREMENTS. 26 COMP. GEN. 676.

IN VIEW OF THE FOREGOING, THIS OFFICE WOULD NOT BE REQUIRED TO OBJECT TO REJECTION OF THE LOWEST BID AND, IF OTHERWISE PROPER, TO THE AWARD OF THE CONTRACT TO COMBUSTION ENGINEERING-1SUPERHEATER, INC.

THE BID DOCUMENTS SUBMITTED BY MORSE BOULGER DESTRUCTOR COMPANY ARE RETURNED HEREWITH.