B-160917, MAY 24, 1967

B-160917, MAY 24, 1967

TO WALD INDUSTRIES, INC.:

FURTHER REFERENCE IS MADE TO YOUR PROTESTS UNDER INVITATION FOR BIDS NOS. DAAA0967 B-0020 AND -0033, ISSUED BY THE AMMUNITION PROCUREMENT AND SUPPLY AGENCY, ARMY MATERIEL COMMAND, JOLIET, ILLINOIS.

ON NOVEMBER 9, 1966, INVITATION FOR BIDS NO. DAAA0967 B-0020 WAS ISSUED FOR 391,984 GRENADE PROJECTION ADAPTERS, M1A2, TO BE MANUFACTURED IN ACCORDANCE WITH TECHNICAL DATA SHEET RDM-67-1409 DATED SEPTEMBER 26, 1966. FOUR BIDS WERE RECEIVED AND OPENED ON DECEMBER 9, 1966, AS FOLLOWS:

PROPOSED UNIT PRICES F.O.B. ORIGIN

BIDDER RAIL MOTOR

WALD INDUSTRIES, INC. $1.485 $1.485

MARTIN MACHINE WORKS, INC. 1.93 1.93

BRISTOL DYNAMICS, INC. 5.24 5.23

ALTON IRON WORKS - 7.50

YOUR BID WAS BASED ON DELIVERY OF 11,984 UNITS ON MAY 30, 1967; 80,000 ON JUNE 30, 1967; 150,000 ON JULY 30, 1967; AND 150,000 ON AUGUST 30, 1967. HOWEVER, THE GOVERNMENT'S REQUIRED DELIVERY SCHEDULE AS STATED IN THE INVITATION WAS FOR 140,000 UNITS, ON OR BEFORE APRIL 30, 1967; 189,112 ON OR BEFORE MAY 31, 1967, AND 62,872 ON OR BEFORE JUNE 30, 1967. THE INVITATION PROVIDED WITH REFERENCE TO TIME OF DELIVERY:

"EARLIER DELIVERY IS ACCEPTABLE PROVIDED THAT ACCUMULATED DELIVERY IS EQUAL TO OR AHEAD OF THE REQUIRED SCHEDULE AT ALL TIMES.

ALTERNATE BIDS FOR THE REQUIRED DELIVERY SCHEDULE AND/OR AN EARLIER DELIVERY SCHEDULE ARE ACCEPTABLE. THE GOVERNMENT SHALL AWARD AT THE LOWEST BID PRICE WHETHER THE DELIVERY SCHEDULE SUBMITTED IS THE REQUIRED SCHEDULE OR EARLIER SCHEDULE. WHERE BIDS ARE EQUAL IN ALL RESPECTS INCLUDING PRICES AND PRIORITIES ESTABLISHED IN ASPR 2-407.6, THE BID OFFERING THE EARLIEST DELIVERY SCHEDULE SHALL BE ACCEPTED. BIDS OFFERING DELIVERY OF A QUANTITY UNDER SUCH TERMS OR CONDITIONS THAT EACH DELIVERY WILL NOT CLEARLY FALL WITHIN THE REQUIRED OR AN EARLIER DELIVERY PERIOD WILL BE CONSIDERED NON-RESPONSIVE AND WILL BE REJECTED. IF A BIDDER OFFERS NO OTHER DELIVERY SCHEDULE, THE REQUIRED SCHEDULE STATED ABOVE SHALL APPLY.

BIDDERS ALTERNATE DELIVERY SCHEDULE: (TO BE COMPLETED BY BIDDER ONLY IF SCHEDULE PROPOSED IS OTHER THAN THE GOVERNMENT SCHEDULE CITED ABOVE).'

YOUR ALTERNATE DELIVERY SCHEDULE FAILED TO MEET THE DELIVERY CRITERIA OF THE INVITATION.

IT IS REPORTED THAT AN AMOUNT OF ?94 EACH WAS ORIGINALLY PROGRAMMED FOR THE ITEM BUT IT APPEARED THAT ADDITIONAL FUNDS MIGHT NOT BECOME AVAILABLE TO PROCURE THE TOTAL QUANTITY ADVERTISED. ALSO, BASED ON A FURTHER STUDY OF THE END ITEM AS ORIGINALLY ADVERTISED, IT WAS FOUND THAT THE INVITATION REQUIREMENT FOR INCLUSION OF THE M-3 RIFLE GRENADE CARTRIDGE IN THE END ITEM PACKAGE WAS NOT NECESSARY.

ON DECEMBER 19, 1966, THE CONTRACTING OFFICER DETERMINED, PURSUANT TO ARMED SERVICES PROCUREMENT REGULATION (ASPR) 2-404.1, TO CANCEL INVITATION NO. DAAA0967 B-0020, SUBJECT TO NOTIFICATION TO ALL BIDDERS, AND TO RESOLICIT THE PROCUREMENT UPON THE AVAILABILITY OF ADEQUATE FUNDS. ALL INTERESTED BIDDERS WERE ACCORDINGLY ADVISED BY NOTICE OF CANCELLATION DATED DECEMBER 20, 1966. THE DETERMINATION TO CANCEL WAS BASED UPON THE NONRESPONSIVENESS OF YOUR LOW BID DUE TO ITS UNACCEPTABLE ALTERNATE DELIVERY SCHEDULE, THE UNREASONABLENESS OF THE LOW RESPONSIVE BID PRICE AND ALL OTHER ACCEPTABLE BIDS, THE INADEQUACY OF FUNDS TO PROCURE UNDER THE INVITATION AS OPENED, AND CHANGES IN THE PHYSICAL REQUIREMENTS OF THE END ITEM. FOR THE REASONS HEREINAFTER STATED, WE FIND NO LEGAL BASIS TO OBJECT TO THE CANCELLATION OF THIS INVITATION.

THEREAFTER, ON JANUARY 13, 1967, INVITATION FOR BIDS NO. DAAA0967 B 0033 WAS ISSUED COVERING THE RE-SOLICITATION OF THIS PROCUREMENT M1A2, UNDER A REVISED DELIVERY SCHEDULE AND WITHOUT A REQUIREMENT FOR THE PACKAGING OF THE GRENADE CARTRIDGES. BIDS WERE OPENED ON JANUARY 31, 1967, WITH THE FOLLOWING RESULTS:

UNIT PRICES F.O.B. ORIGIN

BIDDER RAIL MOTOR

MARTIN MACHINE WORKS, INC. $1.35 $1.35

WALD INDUSTRIES, INC. 1.445 1.445

ASSOCIATED SPRING CORP. 2.55 2.55

BRISTOL DYNAMICS, INC. 4.69 4.69

UNDER THIS INVITATION, AN AWARD WAS MADE AT A CONTRACT PRICE OF $529,178.40, TO MARTIN MACHINE WORKS, INC., THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER, ON FEBRUARY 17, 1967. WE FIND NO BASIS TO OBJECT TO THIS AWARD.

SUBSEQUENT TO THE AWARD, YOU PROTESTED AGAINST THE CANCELLATION OF THE EARLIER INVITATION AND AGAINST THE AWARD MADE UNDER THE SUCCESSOR INVITATION. PARTICULARLY, YOU POINT TO THE UNREALISTIC DELIVERY SCHEDULE OF THE CANCELLED INVITATION AND TO THE FACT THAT YOUR BID RESPONDED TO A NEED FOR A MORE REALISTIC SCHEDULE. IT IS CLEAR THAT YOUR LOW BID DEVIATED FROM THE ADVERTISED DELIVERY REQUIREMENTS AND THAT AWARD TO YOU UNDER SUCH CIRCUMSTANCES WOULD HAVE BEEN IMPROPER. SEE 10 U.S.C. 2305 (C); 36 COMP. GEN. 181; ASPR 1-305.2. ALTHOUGH YOUR BID PRICES WERE REVEALED AT BID OPENING NOTWITHSTANDING THE NONRESPONSIVENESS OF YOUR BID, WE ARE UNAWARE OF ANY PROCEDURE OR MANDATORY REQUIREMENT WHICH WOULD PRECLUDE SUCH DISCLOSURE. IN FACT, BID RESPONSIVENESS NECESSARILY IS DETERMINED AFTER BID OPENING AND PUBLIC DISCLOSURE OF PRICES AND AFTER THE PROCUREMENT AGENCY HAS EVALUATED ALL BIDS AS REQUIRED BY REGULATION. ASPR, PART 4, SECTION II. THE FACT THAT TOOLING INFORMATION IN CONNECTION WITH YOUR BID MIGHT HAVE BECOME KNOWN TO OTHER BIDDERS IS UNDERSTANDABLE SINCE THE LETTER ACCOMPANYING YOUR BID ADVISED THAT TOOLING WAS AVAILABLE. MEMBERS OF THE PREAWARD SURVEY TEAM HAVE STATED THAT MARTIN MACHINE WORKS WAS NOT INFORMED OF YOUR SUPPLIERS, AND IT IS REPORTED THAT, AT THE TIME OF THE SURVEY OF MARTIN, YOUR SUPPLIERS WERE NOT KNOWN AS THE SURVEY OF YOUR CAPABILITIES WAS CONDUCTED AFTER THE MARTIN PREAWARD SURVEY.

WE CANNOT AGREE WITH YOUR CONTENTION THAT AWARD SHOULD HAVE BEEN MADE TO THE SECOND LOW BIDDER UNDER THE FIRST INVITATION ON THE BASIS THAT NO COMPELLING REASON EXISTED FOR CANCELLATION. THE RECORD BEFORE US ESTABLISHES THAT THE RESPONSIVE BID PRICES WERE UNREASONABLY HIGH IN RELATION TO THE FUNDS PROGRAMMED FOR THE PROCUREMENT; THAT THE DELIVERY TERMS WERE TOO STRINGENT UNDER THE CIRCUMSTANCES; AND THAT AN ESSENTIAL PACKAGING ELEMENT WAS BOTH UNNECESSARY AND INHERENTLY DANGEROUS. THESE FOREGOING CONSIDERATIONS NOT ONLY SUPPORTED THE CANCELLATION ACTION BUT REQUIRED THE REJECTION OF ALL BIDS AND THE READVERTISEMENT OF THE PROCUREMENT. SEE 41 COMP. GEN. 709; 36 ID. 364. MOREOVER, IT SHOULD BE NOTED THAT THE COURTS HAVE CONSISTENTLY HELD THAT A REQUEST FOR BIDS BY THE GOVERNMENT DOES NOT IMPORT ANY OBLIGATION TO ACCEPT ANY OF THE OFFERS RECEIVED, INCLUDING THE LOWEST CORRECT BID. O-BRIEN V. CARNEY, 6 F.SUPP. 761,AND COLORADO PAV. CO. V. MURPHY 78 FED. 28.

WE FULLY APPRECIATE YOUR VIEWS WITH RESPECT TO THE CONSEQUENCES RESULTING FROM THE REJECTION OF ALL BIDS AFTER BID OPENING AND REALIZE THAT IT COULD OPERATE TO THE DISADVANTAGE OF SOME OR ALL OF THE BIDDERS WHOSE BIDS HAVE BEEN EXPOSED. IT IS FOR EXACTLY THAT REASON THAT THIS OFFICE HAS CONSISTENTLY EXPRESSED SERIOUS CONCERN IN ALL CASES INVOLVING THE REJECTION OF BIDS AFTER BID OPENING AND HAS INDICATED THAT SUCH ACTION SHOULD NOT BE TAKEN EXCEPT FOR THE MOST COGENT AND COMPELLING REASONS. SEE 39 COMP. GEN. 396. HOWEVER, IN THE INSTANT CASE, COMPELLING REASONS EXISTED FOR THE REJECTION OF ALL BIDS. WE NOTE THAT ALL BIDDERS, INCLUDING YOUR FIRM, WERE AFFORDED AN EQUAL OPPORTUNITY UNDER THE READVERTISEMENT TO SUBMIT COMPETITIVE BIDS WHICH WOULD BE RESPONSIVE TO THE REVISED DELIVERY SCHEDULE. THE FACT THAT YOU CHOSE TO COMPETE UNDER THE READVERTISEMENT ALONG WITH THE FORMER BIDDERS IS INDICATIVE OF YOUR FIRM'S INTENTION TO ACCEDE TO THE RESULTS OF THAT COMPETITION. WHILE IT WAS UNFORTUNATE THAT THE BIDS WERE OPENED AND EXPOSED BEFORE CANCELLATION, THE ACTIONS OF THE PROCURING AGENCY CONSTITUTED A JUSTIFIED EXERCISE OF ITS DISCRETION UNDER PARAGRAPH 8 (B) OF THE BIDDING INSTRUCTIONS MADE A PART OF THE EARLIER INVITATION, AND WERE NOT CONTRARY TO APPLICATION OF LAW OR REGULATION. SEE 36 COMP. GEN. 364; 39 ID. 86; B-154762, AUGUST 26, 1964; AND B-146086, AUGUST 24, 1961.