Protest Against the Inclusion of Certain Contract Terms in IFB

B-198895: Sep 23, 1980

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A small business firm protested an Army solicitation specification which required the contractor to provide utility metering devices to measure the utilities used in the performance of the contract. No specifications were set forth in the solicitation for the meters. The protester also objected to the contractor having to reimburse the Government for the utilities used in performance of the contract on the ground that the utility rates could increase over the 3-year contract period, thereby causing a loss to the contractor. Because the current rates and estimated consumption given by the Army were not guaranteed, a contingency factor was necessary in the bidder's price. Further, the protester asserted that the bid opening date should have been extended to allow the Small Business Administration time to guarantee the required performance bond. GAO found that the lack of specifications concerning the utility meters was not improper, because the item was in common usage and bidders would have no difficulty in furnishing one acceptable to the Government. Requiring the bidder to reimburse the Government for the cost of the utilities was not improper where the Government furnished the current utility rates and estimated consumption, because all bidders bear the same risk in estimating the costs of contract compliance. Since the solicitation was issued 60 days prior to bid opening, there appeared to have been adequate time to comply with the bonding requirement. Accordingly, the protest was denied.

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