Protest of Low Bid Rejection

B-203098: Jun 16, 1981

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A firm complained about the rejection of its low bid in response to an invitation for bids (IFB) for the demolition of a parking garage issued by the Port Authority of Allegheny County, Pennsylvania and partially funded by the Urban Mass Transportation Administration (UMTA). In its complaint, the firm contended that the minority business goals of the solicitation were unconstitutional and unenforceable and that the Port Authority should have permitted it to change its bid after bid opening to comply with the goals. The firm also contended that the conclusive presumption provision was arbitrarily and capriciously applied by the Port Authority. The record showed that, the IFB established goals for female-owned business utilization and provided that, if after diligent and conscientious effort the bidder could not reach the goals, the bidder must submit a request for waiver with its bid. The IFB also provided that, if any bidder offering a reasonable price met the goals, the Port Authority would presume conclusively that all bidders failing to meet the goals did not exert sufficient reasonable efforts and would be ineligible both for a waiver and for the award of the contract. Although the complainant submitted the low bid, it requested a waiver from the female-owned business utilization goals. Subsequently, the Port Authority determined that the complainant's bid was not eligible for consideration and that the second low bid was responsive and its price was reasonable. Although the complainant advised the Port Authority, after bid opening, that its request for waiver was no longer necessary, the Port Authority determined that the complainant's effort to withdraw its waiver request was too late to be considered. GAO held that, with regard to the complainant's contention regarding the propriety of the goals and provisions in the IFB, the protest should have been filed prior to bid opening. Accordingly, this complaint was untimely and would not be considered on the merits. GAO also held that the complainant's bid was arbitrarily rejected since both UMTA and the Port Authority apparently applied the conclusive presumption provision and rejected the complainant's bid solely on the reasonableness of the second low bid and its close proximity with the Government's estimate without consideration to the complainant's bid price and the insignificant impact that the goal had on the overall cost of the work.