B-163775, JUN. 17, 1968

B-163775, JUN. 17, 1968

TO HANSELL, POST, BRANDON AND DORSEY:

REFERENCE IS MADE TO YOUR LETTER DATED MAY 14, 1968, REQUESTING RECONSIDERATION OF OUR DECISION B-163775, TO THE POSTMASTER GENERAL, RELATIVE TO THE QUESTION WHETHER A BID SUBMITTED BY WILLIAM L. GUNTER AND ASSOCIATES, ATLANTA, GEORGIA, SHOULD BE CONSIDERED RESPONSIVE TO AN ADVERTISEMENT FOR BIDS DATED DECEMBER 28, 1967, AS AMENDED, WHEREIN THE POST OFFICE DEPARTMENT SOLICITED BIDS FOR THE CONSTRUCTION AND LEASE OF A NEW POSTAL FACILITY AT KEARNY, NEW JERSEY.

WILLIAM L. GUNTER AND ASSOCIATES PROPOSED TO BUILD THE NEW FACILITY AND TO LEASE THE FACILITY TO THE GOVERNMENT FOR A STATED ANNUAL RENTAL OF $1,985,000 DURING A BASIC 30-YEAR LEASE TERM. THE PROPOSED LEASE AGREEMENT WOULD HAVE COVERED OTHER MATTERS SUCH AS PURCHASE AND RENTAL RENEWAL OPTIONS, AND THE CIRCUMSTANCES UNDER WHICH THE ANNUAL RENTAL WOULD BE SUBJECT TO ADJUSTMENT. IT WAS CONTEMPLATED UNDER THE TERMS OF THE AMENDED ADVERTISEMENT THAT THE CONTRACT AWARD WOULD BE MADE ON THE BASIS OF THE LOWEST ANNUAL RENTAL RATE QUOTED BY A RESPONSIBLE BIDDER. THE GUNTER GROUP SUBMITTED THE LOWEST BID AND THE NEXT LOWEST BID WAS SUBMITTED BY THE JOINT VENTURE OF MCCLOSKEY AND COMPANY, PHILADELPHIA, PENNSYLVANIA, AND C.H. LEAVELL AND COMPANY, EL PASO, TEXAS.

THE JOINT VENTURE OF MCCLOSKEY AND LEAVELL FILED A PROTEST AGAINST THE POSSIBLE AWARD OF A CONTRACT TO THE GUNTER GROUP WHICH IS REPRESENTED BY YOUR FIRM. THE POST OFFICE DEPARTMENT PRESENTED THE QUESTION WHETHER AN AWARD TO YOUR CLIENT WOULD BE PROPER, NOTWITHSTANDING THE FACT THAT ACCEPTANCE OF THE GUNTER BID PROBABLY WOULD RESULT IN A SAVING TO THE GOVERNMENT OF ABOUT $2,190,000 IN ANNUAL RENTALS OVER A PERIOD OF 30 YEARS. WE CONSIDERED THE VARIOUS CONTENTIONS MADE ON BEHALF OF THE LOW BIDDER AND THE SECOND LOWEST BIDDER AND DETERMINED THAT THE FAILURE OF YOUR CLIENT TO SUBMIT WITH ITS BID SIGNED COPIES OF AMENDMENTS NOS. 1 AND 2 TO THE ADVERTISEMENT FOR BIDS MATERIALLY AFFECTED THE SUBSTANCE OF ITS BID, PARTICULARLY IN VIEW OF THE FACT THAT THE AMENDMENTS RELATED IN PART TO CHANGES IN THE ADVERTISED SPECIFICATIONS. WE THEREFORE CONCLUDED THAT THE BID OF YOUR CLIENT SHOULD BE REJECTED AS NONRESPONSIVE TO THE AMENDED ADVERTISEMENT FOR BIDS.

WE UNDERSTAND THAT NO OTHER BID WAS ACCEPTED AND THAT A NEW ADVERTISEMENT FOR BIDS CONCERNING THE KEARNY PROJECT WAS ISSUED BY THE POST OFFICE DEPARTMENT, WITH BIDS BEING SCHEDULED FOR OPENING ON JUNE 19, 1968. MAY 22, 1968, DURING A CONFERENCE HELD IN OUR OFFICE, YOUR FIRM PROTESTED THE READVERTISEMENT AND SUBMITTED THE LETTER DATED MAY 14, 1968, REQUESTING THAT WE RECONSIDER THE DECISION DATED MAY 6, 1968, AND ADVISE THE POST OFFICE DEPARTMENT THAT AN AWARD MAY BE MADE TO YOUR CLIENT PURSUANT TO THE ORIGINAL ADVERTISEMENT FOR BIDS, AS AMENDED, IN ACCORDANCE WITH THE SUBMISSION BY YOUR CLIENT OF SIGNED COPIES OF THE TWO AMENDMENTS TO THE ADVERTISEMENT AFTER THE SCHEDULED BID OPENING DATE. THE LETTER OF MAY 14, 1968, REFERS, IN PARTICULAR, TO A REVISED TABULATION OF ESTIMATED ADDITIONAL COSTS AND ESTIMATED COST DEDUCTIONS WHICH WOULD BE INVOLVED IN COMPLYING WITH THE TWO AMENDMENTS.

DURING A SUBSEQUENT MEETING ON JUNE 6, 1968, WITH MEMBERS OF YOUR FIRM AND REPRESENTATIVES OF BROWN AND MATHEWS, INCORPORATED, YOUR CLIENT'S INTENDED CONSTRUCTION CONTRACTOR FOR THE KEARNY PROJECT, WE WERE FURNISHED A COPY OF A LETTER DATED JUNE 4, 1968, FROM BROWN AND MATHEWS TO MR. WILLIAM L. GUNTER, COMMENTING ON THE NATURE OF THE ADDENDA CHANGES, TOGETHER WITH A COPY OF BROWN AND MATHEWS' WEIGHT CALCULATIONS CONCERNING MATERIALS WHICH WOULD BE REQUIRED IN THE CONSTRUCTION OF THE NEW POSTAL FACILITY.

AS INDICATED IN OUR DECISION OF MAY 6, 1968, THERE WAS RECEIVED FROM THE POST OFFICE DEPARTMENT A TABULATION PREPARED BY THE ARCHITECTURAL ENGINEERING FIRM OF COMPARE TO AND KENNY, WHICH LISTED VARIOUS ITEMS OF ESTIMATED ADDITIONS AND DEDUCTIONS IN COSTS TO THE SUCCESSFUL BIDDER WHICH WOULD RESULT FROM COMPLIANCE WITH THE TWO AMENDMENTS TO THE ADVERTISEMENT FOR BIDS, COPIES OF WHICH WERE NOT SIGNED AND SUBMITTED WITH YOUR CLIENT'S BID. THE SUM OF $165,547 FOR CONSTRUCTION OF OFF SITE RAILROAD TRACKS WAS LISTED AS A SEPARATE ITEM OF ADDITIONAL COST TO BE INCURRED BY THE SUCCESSFUL BIDDER. THE TRACKS WERE TO BE INSTALLED BY THE ERIE-LACKAWANNA RAILROAD UNDER AN AGREEMENT WITH THE GOVERNMENT AND IT WAS PROPOSED TO REQUIRE THE SUCCESSFUL BIDDER TO ASSUME THE RESPONSIBILITY FOR MAKING PAYMENT TO THE RAILROAD COMPANY. THE AMOUNT OF $100,000 WAS LISTED AS A COST DEDUCTION FOR ELIMINATION OF ONE ITEM OF THE ORIGINALLY SPECIFIED WORK BY SPECIFICATION ADDENDUM NO. 1. FOR SPECIFICATION ADDENDA NOS. 2, 3 AND 4, VARIOUS COST ADDITIONS AND DEDUCTIONS WERE LISTED AND, ON THE BASIS OF ALL OF THE AMOUNTS SET FORTH IN THE TABULATION, THE NET ADDITIONAL COST TO THE SUCCESSFUL BIDDER BY REASON OF COMPLIANCE WITH THE TWO AMENDMENTS TO THE ADVERTISEMENT FOR BIDS WAS ESTIMATED TO AMOUNT TO THE APPROXIMATE SUM OF $6,977.40.

CERTAIN REVISIONS WERE MADE IN THE TABULATION OF ESTIMATED COST ADDITIONS AND DEDUCTIONS BY THE FIRM OF COMPARE TO AND KENNY, FOLLOWING CONSIDERATION OF COMMENTS AND RECOMMENDATIONS FOR ADJUSTMENTS WHICH WERE SUBMITTED TO COMPARE TO AND KENNY BY THE FIRM WHICH YOUR CLIENT INTENDED TO ENGAGE AS ITS CONSTRUCTION CONTRACTOR IF IT RECEIVED THE CONTRACT AWARD. UNDER THE TABULATION, AS REVISED, THE ESTIMATED COST EFFECT OF COMPLIANCE WITH THE TWO AMENDMENTS TO THE ADVERTISEMENT FOR BIDS WOULD BE TO DECREASE RATHER THAN TO INCREASE THE OVERALL COST TO THE SUCCESSFUL BIDDER. WE AGREE WITH YOUR STATEMENT THAT OUR DECISION, AS WRITTEN, MIGHT LEAVE THE IMPRESSION THAT THERE IS A DIFFERENCE OF OPINION IN THE MATTER OF ESTIMATED NET INCREASED COSTS OR DECREASED COSTS, BETWEEN THE ARCHITECT -ENGINEER FOR THE POST OFFICE DEPARTMENT AND YOUR CLIENT'S PROPOSED CONSTRUCTION CONTRACTOR. HOWEVER, OUR DECISION CLEARLY INDICATED THAT, IN DETERMINING THE QUESTION AS TO THE RESPONSIVENESS OF YOUR CLIENT'S BID, IT WOULD NOT NECESSARILY BE MATERIAL WHETHER THERE WAS A NET ESTIMATED COST INCREASE OR A NET ESTIMATED COST DECREASE AS A RESULT OF COMPLIANCE WITH THE TWO AMENDMENTS.

THERE APPEAR TO HAVE BEEN A NUMBER OF CHANGES IN THE WORK TO BE DONE AND THE RESPONSIBILITIES TO BE ASSUMED BY THE SUCCESSFUL BIDDER. FROM A COST STANDPOINT THESE CHANGES OPERATED BOTH TO INCREASE AND TO DECREASE A BIDDER'S COST, AND IT IS ESTIMATED BY THE GOVERNMENT'S ARCHITECT-ENGINEER THAT THE NET EFFECT OF ALL CHANGES WOULD BE AN OVERALL DECREASE IN COST TO THE BIDDER. AS WE STATED IN OUR DECISION OF MAY 6, 1968, WE DO NOT BELIEVE THAT THIS IS DETERMINATIVE OF THE QUESTION WHETHER A BID NOT INCLUDING SUCH CHANGES MAY BE CONSIDERED RESPONSIVE.

IN ADDITION TO THE COST FACTOR, ATTENTION MUST BE GIVEN TO THE WORK ITSELF BEFORE AND AFTER THE CHANGES. THE LEGAL EFFECT OF A BID WHICH FAILS TO ACKNOWLEDGE RECEIPT OF CHANGES ISSUED BEFORE BID OPENING IS TO BIND THE BIDDER TO PERFORM ONLY IN ACCORDANCE WITH THE ORIGINAL AND UNCHANGED TERMS AND CONDITIONS OF THE ADVERTISEMENT FOR BIDS. THUS, REGARDLESS OF THE NET COST EFFECT OF ALL CHANGES CONSIDERED TOGETHER, THE FURTHER QUESTION MUST BE CONSIDERED WHETHER PERFORMANCE WITHOUT THE CHANGES WILL MEET THE NEEDS OF THE PROCURING AGENCY.

THE SO-CALLED "ADDITIVE" CHANGES IN THE SPECIFICATIONS FOR THE WORK HAVE A TOTAL ESTIMATED VALUE OF ABOUT $185,000. WE FIND IT DIFFICULT TO CONCEIVE OF A SITUATION IN WHICH COST INCREASES OF THIS MAGNITUDE IN THE SPECIFICATIONS WOULD NOT RESULT IN CHANGES IN THE WORK ITSELF DEEMED NECESSARY TO MEET AGENCY NEEDS. INDEED, IF IT WERE OTHERWISE, THE PROCUREMENT WELL MIGHT BE CONSIDERED DEFECTIVE AS OVERSTATING THE GOVERNMENT'S ACTUAL REQUIREMENTS.

WE HAVE EXAMINED A NUMBER OF THE SPECIFICATION CHANGES EFFECTED BY "ADDITIVE" ITEMS IN ADDENDA NOS. 2, 3 AND 4. MANY OF THESE CHANGES CALL FOR WORK WHICH WE UNDERSTAND IS REQUIRED TO MEET THE NEEDS OF THE POST OFFICE DEPARTMENT. FOR EXAMPLE, ITEM 4 ON PAGE 3 OF ADDENDUM NO. 3 CHANGED THE TYPE OF FLOOR IN CERTAIN ROOMS. THE ORIGINAL SPECIFICATIONS CALLED FOR A CONCRETE SLAB FLOOR WHICH WOULD HAVE NECESSITATED HAVING EQUIPMENT WIRING ON THE FLOOR OR IN CONDUITS IN THE CONCRETE SLAB. NEITHER WAS AN ACCEPTABLE SOLUTION, SO THE SPECIFICATIONS WERE CHANGED TO REQUIRE THE CONCRETE FLOOR SLAB TO BE DROPPED AND THE INSTALLATION OF SPECIAL FLOORING TO PERMIT EASY ACCESS TO WIRING UNDER THAT FLOOR. WHILE THE DOLLAR VALUE OF THIS CHANGE IS NOT GREAT, THE ORIGINAL CONCRETE SLAB FLOOR AND ITS ELEVATION SIMPLY WOULD NOT MEET THE POST OFFICE DEPARTMENT REQUIREMENTS.

BROWN AND MATHEWS REFERS IN ITS LETTER OF JUNE 4, 1968, TO THREE CHANGES AS FOLLOWS:

"2. IN ADDENDUM NO. 2, ROOM NUMBERS AND TITLES WERE TO BE INSTALLED ON ENTRANCE DOORS. THIS CHANGE, MAINLY IDENTIFYING THE ROOMS, DID NOT INCREASE THE QUANTITY IN THE FACILITY IN ANY SUBSTANTIAL WAY AND DID NOT CHANGE THE QUALITY OF THE BUILDING.

"3. AGAIN, AFTER THE BID DOCUMENTS WERE PREPARD, THE ARCHITECT IN ADDENDUM NO. 3 REVISED THE TV CONTROL ROOM AND KEYING CODE TRANSLATOR. THIS BID IN ACTUALITY CHANGED THE QUALITY OF THE BUILDING TO SOME EXTENT AND INCREASED THE QUANTITY OF SQUARE FEET OF ELEVATED FLOOR PLUS CERTAIN OTHER REVISIONS TO HOUSE THIS SENSITIVE EQUIPMENT.

"4. A CHANGE IN ADDENDUM NO. 4 RESULTED WHEN AFTER ISSUING THE PLANS AND SPECIFICATIONS, THE SUBCONTRACTORS NOTED THAT A REQUIREMENT OF THE STATE HAD NOT BEEN MET, I.E.; THE REQUIREMENT THAT ALL SEWAGE DISPOSAL PLANTS HAVE A LICENSED OPERATOR FOR A PERIOD OF ONE YEAR. THIS MISUNDERSTANDING DID NOT CHANGE THE QUALITY OR QUANTITY OF MATERIAL IN THE BUILDING, BUT IS MERELY A STANDARD OPERATING PROCEDURAL REQUIREMENT TO COMPLETE THE TESTING AND OPERATION OF THE SEWAGE DISPOSAL SYSTEM.'

AT THE MEETING ON JUNE 6, 1968, IT WAS BROUGHT OUT THAT THE ESTIMATED AMOUNTS INVOLVED IN THE THREE CHANGES ARE, RESPECTIVELY, $2,500, $2,500 AND $9,500. IT WAS OTHERWISE STATED IN THE LETTER OF JUNE 4, 1968, THAT TO EXPLAIN IN FULL DETAIL THE FACTS AS TO EACH SPECIFIC ITEM IN THE VARIOUS ADDENDA AND BROWN AND MATHEWS' REASONS WHY THEY SHOULD BE CONSIDERED CLARIFICATIONS OR INTERPRETATIONS "WOULD MAKE THIS A RATHER VOLUMINOUS DOCUMENT" .

REFERENCE WAS MADE IN OUR DECISION OF MAY 6, 1968, TO SEVERAL PRIOR DECISIONS OF OUR OFFICE INVOLVING BIDS NOT ACCOMPANIED BY SIGNED COPIES OF BID INVITATION AMENDMENTS. AS INDICATED IN SOME OF THOSE CASES, THERE MAY BE CIRCUMSTANCES WHICH WOULD PERMIT A WAIVER OF A BIDDER'S FAILURE TO ACKNOWLEDGE THE RECEIPT OF INVITATION AMENDMENTS PRIOR TO BID OPENING, SUCH AS WHERE THE ONLY EFFECT OF THE AMENDMENTS WOULD BE TO DELETE OR DECREASE WORK AND THUS THE SUCCESSFUL BIDDER'S COSTS. WE FOUND NO PRIOR CASE WHICH INVOLVED A SITUATION WHERE, AS HERE, THERE WERE VARIOUS ADDITIONS AND DELETIONS OF WORK AND THE ARCHITECT-ENGINEER FOR THE AGENCY CONCERNED ESTIMATED THAT THE COST EFFECT OF THE AMENDMENTS WOULD BE AN OVERALL DECREASE. HOWEVER, WE HAD RECENTLY HELD IN A DECISION OF APRIL 24, 1968, B-163885, THAT A LOW BIDDER'S FAILURE TO ACKNOWLEDGE THE RECEIPT OF AN AMENDMENT TO AN INVITATION FOR BIDS, ISSUED BY THE DEPARTMENT OF THE ARMY ON A CONSTRUCTION PROJECT, SHOULD NOT BE WAIVED AS A MINOR INFORMALITY OR IRREGULARITY IN BID PURSUANT TO THE PROVISIONS OF SECTION 2 -405, ARMED SERVICES PROCUREMENT REGULATION (ASPR). A DISPUTE WAS INVOLVED IN THAT CASE AS TO WHETHER TOTAL COSTS WOULD BE INCREASED OR DECREASED THROUGH COMPLIANCE WITH THE AMENDMENT BUT WE CONCLUDED THAT IT WAS UNNECESSARY TO DETERMINE THIS SINCE IT WAS EVIDENT THAT THE CHANGES WHICH REQUIRED THE PERFORMANCE OF ADDITIONAL WORK WERE OF SUCH MAGNITUDE AS TO HAVE A SUBSTANTIAL EFFECT UPON AND TO INCREASE THE QUANTITY OF THE CONTRACT WORK. YOU HAVE REFERRED TO THE DECISION OF APRIL 24, 1968, AS THE "BLAKE DECISION" .

IT IS CONTENDED IN YOUR LETTER OF MAY 14, 1968, THAT THE FACTS OF THE BLAKE DECISION ARE MATERIALLY DIFFERENT FROM THOSE IN THIS CASE. THERE ARE OBVIOUS DIFFERENCES, AS YOU SUGGEST. THE BLAKE DECISION DID NOT INVOLVE A PROPOSED CONSTRUCTION AND LEASE OF A NEW POSTAL FACILITY AND THERE WAS A DISPUTE IN THE BLAKE CASE CONCERNING WHAT WOULD BE THE NET COST EFFECT OF COMPLIANCE WITH THE UNACKNOWLEDGED AMENDMENT. ALSO, YOU ASSUME THAT, BECAUSE THE POST OFFICE DEPARTMENT ADVISED US THAT IT WOULD ACCEPT THE BID OF YOUR CLIENT UNLESS WE DETERMINED THE BID TO BE NONRESPONSIVE, THE DEPARTMENT DID NOT DETERMINE THE "ADDITIVES" OF SPECIFICATION ADDENDA NOS. 2, 3 AND 4 TO BE ESSENTIAL IN CONNECTION WITH THE USE OF THE FACILITY WHICH IT PROPOSED TO LEASE FROM THE SUCCESSFUL BIDDER. THE DEPARTMENT CONSIDERED THAT THE FAILURE OF YOUR CLIENT'S BID TO INCLUDE ACKNOWLEDGEMENT OF THE FACT THAT THE SUCCESSFUL BIDDER WOULD BE REQUIRED TO PAY FOR THE CONSTRUCTION OF OFF-SITE RAILROAD TRACKS RAISED DOUBT AS TO THE RESPONSIVENESS OF THE BID. THE QUESTION AS TO THE COST EFFECT OF THE SPECIFICATION ADDENDA DOES NOT APPEAR TO HAVE BEEN CONSIDERED IN DETAIL BY THE DEPARTMENT PRIOR TO ITS SUBMISSION OF THE MATTER TO US. YOU REFER TO THE FACT THAT, AS A GENERAL RULE, WE HAVE TAKEN THE POSITION THAT A DETERMINATION OF THE MATERIALITY OF SPECIFICATION PROVISIONS SHOULD BE MADE BY THE AGENCY CONCERNED IN VIEW OF THE LACK IN OUR OFFICE OF TECHNICAL EXPERTISE IN SUCH MATTERS. HOWEVER, AS INDICATED ABOVE, WE HAVE EXAMINED A NUMBER OF THE ACTUAL SPECIFICATION CHANGES EFFECTED BY "ADDITIVE" ITEMS IN ADDENDA NOS. 2, 3 AND 4 OF THE ADVERTISED SPECIFICATIONS AND IT IS OUR OPINION THAT THERE IS NO REASONABLE BASIS FOR A CONCLUSION THAT THE ADDENDA DID NOT MATERIALLY CHANGE THE ORIGINAL SPECIFICATIONS OR THAT CERTAIN OF THE "ADDITIVE" ITEMS DO NOT REFLECT THE ACTUAL NEEDS OF THE POST OFFICE DEPARTMENT. DISCUSSIONS WITH REPRESENTATIVES OF THE DEPARTMENT, IT WAS INDICATED THAT THE ADDITIVES OF ADDENDA NOS. 2, 3 AND 4 WERE BELIEVED TO BE NECESSARY TO FULFILL THE NEEDS OF THE DEPARTMENT. IT IS APPARENT THAT THE DEPARTMENT NEVER INTENDED TO MAKE AN AWARD TO YOUR CLIENT ON THE BASIS OF ITS BID WITHOUT THE SIGNED AMENDMENTS BUT, RATHER, ON THE BASIS OF THE BID AS CHANGED BY SIGNING THE AMENDMENTS AFTER BID OPENING ASSUMING WE DETERMINED THIS TO BE PROPER IN THE PARTICULAR CIRCUMSTANCES.

THE BLAKE DECISION WAS REFERRED TO IN OUR DECISION OF MAY 6, 1968, ONLY IN CONNECTION WITH OUR DETERMINATION IN THIS CASE THAT, IF ANY SUBSTANTIAL QUANTITY OF WORK IS ADDED BY AN AMENDMENT TO AN INVITATION FOR BIDS, BIDDERS WHO FAIL TO ACKNOWLEDGE THAT AMENDMENT ARE NOT BIDDING ON THE SAME WORK AS THOSE WHO HAVE ACKNOWLEDGED THE AMENDMENT, REGARDLESS OF THE VALUE OF ANY WORK WHICH MAY HAVE BEEN DELETED BY THE SAME OR SOME OTHER AMENDMENT. WE CONSIDERED YOUR PREVIOUS CONTENTION THAT THE BLAKE DECISION SHOULD NOT BE USED AS A PRECEDENT BECAUSE THERE IS A DIFFERENCE BETWEEN THE LANGUAGE OF SECTION 2-405, ASPR, AND THAT OF SECTION 1-2.405, FEDERAL PROCUREMENT REGULATIONS (FPR), WHICH DEFINE A MINOR INFORMALITY OR IRREGULARITY IN BID. THE FPR DEFINITION PROVIDES THAT A DEFECT OR VARIATION IN A BID IS IMMATERIAL AND INCONSEQUENTIAL WHEN ITS SIGNIFICANCE AS TO PRICE, QUANTITY, QUALITY OR DELIVERY IS TRIVIAL OR NEGLIGIBLE WHEN CONTRASTED WITH THE TOTAL COST OR SCOPE OF THE SUPPLIES OR SERVICES BEING PROCURED. THE ASPR DEFINITION IS MORE RESTRICTIVE IN ITS DEFINITION OF A MINOR INFORMALITY OR IRREGULARITY IN BID. IT PROVIDES THAT A MINOR INFORMALITY OR IRREGULARITY IS ONE "* * * HAVING NO EFFECT OR MERELY A TRIVIAL OR NEGLIGIBLE EFFECT ON PRICE, AND NO EFFECT ON QUALITY, QUANTITY, OR DELIVERY OF THE SUPPLIES OR PERFORMANCE OF THE SERVICES BEING PROCURED

WE REMAIN OF THE OPINION THAT, UNDER EITHER DEFINITION OF A MINOR INFORMALITY OR IRREGULARITY, AS SET FORTH IN THE PARTICULAR REGULATIONS, THE REFERRED-TO PRINCIPLE OF THE BLAKE DECISION WOULD BE APPLICABLE TO THE FACTS OF THIS CASE.

THE ELEMENT OF QUALITY HAS BEEN REFERRED TO IN CONNECTION WITH OUR DETERMINATION THAT THERE HAD BEEN A SUBSTANTIAL INCREASE IN THE QUANTITY OF THE SPECIFIED WORK. IN REACHING THAT CONCLUSION, THE ELEMENT OF QUALITY WAS IMPLICITLY INVOLVED, INASMUCH AS THERE WOULD BE NO POINT IN RAISING A QUESTION OF QUANTITY IF THE TOTAL QUANTITY OF AN ADDITIVE ITEM WAS LESS THAN THE TOTAL QUANTITY OF THE SAME TYPE OF WORK DELETED. WOULD ALSO APPEAR THAT THE QUESTION WHETHER THERE WAS, IN FACT, SUBSTANTIAL INCREASE IN THE QUANTITY OF WORK DIFFERING FROM THE ORIGINALLY SPECIFIED WORK CANNOT BE DETERMINED ON THE BASIS OF A COMPARISON OF AN ESTIMATED TOTAL WEIGHT OF THE PROPOSED NEW POSTAL FACILITY BUILT IN ACCORDANCE WITH THE AMENDED SPECIFICATIONS WITH AN ESTIMATED TOTAL WEIGHT OF A FACILITY BUILT IN ACCORDANCE WITH THE ORIGINAL PLANS AND SPECIFICATIONS.

IT IS POSSIBLE THAT SOME OF THE REFERENCED WORK "ADDITIVES" OF SPECIFICATION ADDENDA NOS. 2, 3 AND 4 DO NOT INVOLVE ACTUAL CHANGES IN CONSTRUCTION REQUIREMENTS BUT REPRESENT ONLY CLARIFICATIONS OF THE ORIGINAL SPECIFICATIONS. HOWEVER, IT IS NOT DISPUTED THAT THE ADDENDA DID CHANGE THE REQUIREMENTS OF THE ORIGINAL SPECIFICATIONS IN CERTAIN RESPECTS. IT IS OUR OPINION THAT THE CHANGES WHICH HAD THE EFFECT OF REQUIRING DIFFERENCES IN CONSTRUCTION MUST BE REGARDED AS BEING SUFFICIENTLY SUBSTANTIAL AND MATERIAL TO PRECLUDE THE CONSIDERATION OF A BID NOT ACCOMPANIED BY SIGNED COPIES OF THE AMENDMENTS TO THE POST OFFICE DEPARTMENT ADVERTISEMENT FOR BIDS AS HAVING BEEN RESPONSIVE TO THE ESSENTIAL REQUIREMENTS OF THE ADVERTISEMENT, AS AMENDED.

IT HAS BEEN CONTENDED THAT, SINCE THE FORM OF AGREEMENT TO LEASE WHICH WAS EXECUTED BY YOUR CLIENT PROVIDES IN PART THAT THE LESSOR WILL SATISFACTORILY COMPLETE THE CONSTRUCTION OF BUILDINGS AND IMPROVEMENTS IN ACCORDANCE WITH DRAWINGS AND SPECIFICATIONS PREPARED BY COMPARE TO AND KENNY, THE BIDDER WAS BOUND TO PERFORM IN ACCORDANCE WITH THE SPECIFICATIONS AND ANY ADDENDA THERETO, REGARDLESS OF WHETHER THE BIDDER SUBMITTED WITH ITS BID SIGNED COPIES OF THE AMENDMENTS TO THE ADVERTISEMENT FOR BIDS. WE DO NOT AGREE WITH ANY SUCH CONTENTION SINCE THE PARTICULAR PROVISION OF THE FORM OF AGREEMENT TO LEASE OBVIOUSLY WAS DIRECTED TO THE PLANS AND SPECIFICATIONS WHICH HAD BEEN PREPARED FOR ISSUANCE WITH THE ORIGINAL ADVERTISEMENT, AND NO BIDDER REASONABLY COULD BE SAID TO HAVE AGREED TO ANY SPECIFICATION CHANGES AT THE TIME OF BID OPENING, OR TO HAVE AGREED TO PAY FOR THE CONSTRUCTION OF OFF-SITE RAILROAD TRACKS, UNLESS HE FORMALLY ACKNOWLEDGED RECEIPT OF THE AMENDMENTS TO THE ADVERTISEMENT BY SIGNING THE AMENDMENTS AND SUBMITTING THEM AS A PART OF HIS BID, OR OTHERWISE PROVIDED WRITTEN NOTICE TO THE GOVERNMENT PRIOR TO BID OPENING THAT THE AMENDMENTS WERE RECEIVED AND CONSIDERED IN THE PREPARATION OF THE BID.

IT IS AN ESTABLISHED RULE WITH RESPECT TO FORMAL COMPETITIVE PROCUREMENT BY GOVERNMENTAL AGENCIES THAT THE CONTRACT AWARDED TO THE SUCCESSFUL BIDDER MUST BE THE CONTRACT OFFERED TO ALL BIDDERS. 36 COMP. GEN. 536; 38 ID. 508. IN VIEW THEREOF, THE AUTHORITY TO WAIVE DEFECTS OR VARIATIONS IN BID MUST BE LIMITED TO THE WAIVER OF MINOR DEFECTS OR VARIATIONS WHICH DO NOT MATERIALLY AFFECT THE SUBSTANCE OF THE BID, AS DISTINGUISHED FROM THE FORM OF THE BID. THERE IS NO AUTHORITY FOR WAIVING, AS A MINOR INFORMALITY OR IRREGULARITY IN BID, A MATERIAL EXCEPTION IMPOSED BY A BIDDER AND IT IS ALSO OUR OPINION THAT THERE IS NO AUTHORITY TO WAIVE A BIDDER'S FAILURE TO ACKNOWLEDGE THE RECEIPT OF BID INVITATION AMENDMENTS WHICH MATERIALLY CHANGE THE ORIGINAL REQUIREMENTS, REGARDLESS OF THE FACT THAT THE BIDDER MIGHT HAVE INTENDED TO COMPLY WITH THE ORIGINAL INVITATION AND ALL AMENDMENTS THERETO BUT FAILED TO DISCLOSE SUCH INTENTION AT THE TIME OF SUBMITTING A BID OR AT ANY TIME PRIOR TO BID OPENING.

IN OUR OPINION, IT IS NECESSARY FOR US TO APPLY WHAT YOU HAVE REFERRED TO AS A RATHER RIGID RULE IN SUCH MATTERS SINCE IT HAS LONG BEEN ESTABLISHED THAT BIDDING ON GOVERNMENT CONTRACTS UNDER FORMAL ADVERTISING PROCEDURES MUST BE ON A COMMON BASIS AND IT IS OBVIOUS THAT THERE WOULD BE NO PROPER RECOGNITION OF THAT PRINCIPLE IN THIS CASE IF AN AWARD WAS MADE TO YOUR CLIENT PURSUANT TO ITS AGREEMENT AFTER OPENING OF BIDS TO COMPLY WITH ALL OF THE TERMS AND CONDITIONS OF THE POST OFFICE DEPARTMENT'S AMENDED ADVERTISEMENT FOR BIDS. WE FIND NO BASIS FOR TAKING THE POSITION THAT THE "ADDITIVE" CHANGES OF SPECIFICATION ADDENDA NOS. 2, 3 AND 4 MAY BE CONSIDERED TO BE EITHER IMMATERIAL OR INCONSEQUENTIAL BECAUSE THE TOTAL VALUE OF THE CHANGES MAY BE RELATIVELY SMALL WHEN COMPARED WITH THE TOTAL VALUE OF THE PROPOSED NEW POSTAL FACILITY OR THE TOTAL RENTAL WHICH WOULD BE PAYABLE BY THE GOVERNMENT OVER THE BASIC 30-YEAR LEASE PERIOD, OR BECAUSE THE ESTIMATED NET COST EFFECT OF THE TWO AMENDMENTS TO THE ADVERTISEMENT WOULD BE TO DECREASE THE SUCCESSFUL BIDDER'S COSTS.

ALTHOUGH OUR DECISION OF MAY 6, 1968, SHOULD BE MODIFIED TO SHOW THAT THE NET COST EFFECT OF THE TWO BID AMENDMENTS INVOLVED WOULD BE TO DECREASE THE SUCCESSFUL BIDDER'S OVERALL COSTS, WE MUST ADHERE TO THE BASIC CONCLUSION THAT THE BID OF YOUR CLIENT SHOULD BE REJECTED AS NONRESPONSIVE TO THE ESSENTIAL REQUIRMENTS OF THE DECEMBER 28, 1967, ADVERTISEMENT, AS AMENDED. ACCORDINGLY, WE FIND NO BASIS UPON WHICH WE WOULD BE WARRANTED IN REQUESTING THE POST OFFICE DEPARTMENT TO CANCEL THE NEW ADVERTISEMENT FOR BIDS AND TO MAKE AN AWARD TO YOUR CLIENT PURSUANT TO THE ORIGINAL ADVERTISEMENT AND THE AMENDMENTS THERETO.