B-161790, JUL. 26, 1967

B-161790, JUL. 26, 1967

BIDS - LATE - MAIL IRREGULARITY DECISION TO SECY. AIR FORCE RE PROTEST OF TETRO CONSTRUCTION CO. WHERE A BID MODIFICATION WHICH WAS SENT BY THE LOW BIDDER BY CERTIFIED MAIL SHOULD HAVE ARRIED IN TIME FOR OPENING OF BIDS FOR FURNISHING LABOR AND MATERIAL FOR REPAIR OF STEEL WATER TANKS AT LUKE AIR FORCE BASE AND THERE IS A POSSIBILITY OF IRREGULARITY IN THE MAILS WHICH IS BEING INVESTIGATED BY THE POSTAL AUTHORITIES, AN AWARD MAY BE MADE BEFORE THE WAGE RATES EXPIRE WITH NOTICE TO PROCEED WITHHELD UNTIL RESULTS OF INVESTIGATION. HOWEVER, IF LABOR DEPT. EXTENDS WAGE RATES AWARD MAY BE WITHHELD FOR A LONGER PERIOD FOR THE RESULTS OF THE INVESTIGATION.

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTER DATED JULY 19, 1967, WITH ATTACHMENTS, FROM THE DEPUTY CHIEF, PROCUREMENT OPERATIONS DIVISION, DIRECTORATE, PROCUREMENT POLICY, DCS/S AND L, REFERENCE AFSPPCA, REPLYING TO OUR REQUEST FOR AN ADMINISTRATIVE REPORT ON THE PROTEST OF TETRO CONSTRUCTION COMPANY (TETRO) AGAINST AWARD TO ANOTHER BIDDER UNDER INVITATION FORBIDS NO. F 02604-67-B-1156, ISSUED BY LUKE AIR FORCE BASE, ARIZONA.

IT IS REPORTED, AND THE RECORD SHOWS, THAT THE INVITATION, ISSUED APRIL 11, 1967, SOLICITED BIDS FOR FURNISHING ALL LABOR AND MATERIALS REQUIRED FOR THE REPAIR, CLEANING AND SURFACE TREATMENT OF CERTAIN STEEL WATER TANKS AT LUKE AIR FORCE BASE. BIDS WERE SCHEDULED TO BE OPENED ON MAY 9, 1967. AN AMENDMENT TO THE INVITATION INCORPORATED DEPARTMENT OF LABOR WAGE RATE DECISION NO. AG-6,861, WHICH EXPIRES JULY 26, 1967, AND EXTENDED THE BID OPENING DATE TO MAY 17, 1967. BIDS WERE OPENED ON THIS LATTER DATE. THE TWO LOWEST BIDS WERE SUBMITTED BY TETRO AND BY DEAN JONES CONTRACTOR (JONES).

TETRO'S BID IS IN THE AMOUNT OF $33,300. QUESTION HAS BEEN RAISED AS TO THE JONES' BID. JONES SUBMITTED A BID DATED MAY 4, 1967 (POSTMARKED MAY 5, 1967) IN THE AMOUNT OF $33,561. HOWEVER, BY MODIFICATION LETTER DATED MAY 15, 1967, WHICH WAS RECEIVED BY LUKE AIR FORCE BASE ON MAY 19, 1967, JONES REDUCED ITS BID TO $32,761. INFORMATION DEVELOPED BY THE CONTRACTING OFFICER INDICATES THAT THE MODIFICATION WAS SENT BY CERTIFIED MAIL FROM CLINTON, OKLAHOMA, PURPORTEDLY ON MAY 15, 1967, AS EVIDENCED BY A RECEIPT FOR CERTIFIED MAIL SUBMITTED BY JONES. THE ENVELOPE CONTAINING THE MODIFICATION CARRIES A CLINTON POSTMARK, DATED MAY 5, 1967. THE COGNIZANT POSTMASTER ADVISED THE CONTRACTING OFFICER THAT THE BUSINESS DAY ON MAY 15, 1967, AT THE CLINTON POST OFFICE ENDED AT :00 P.M., AND THAT IN THE NORMAL DELIVERY OF THE MAIL, A LETTER MAILED AT THE CLINTON POST OFFICE SHOULD HAVE ARRIVED AT LUKE AIR FORCE BASE AT 9:00 A.M., MAY 17, 1967, IN TIME FOR DELIVERY BEFORE BID OPENING TIME, 10:30 A.M., D.S.T. MAY 17, 1967.

THE CONTRACTING OFFICER REPORTS THAT ON EXAMINATION OF THE MAILING DOCUMENTS HE SUSPECTED A POSSIBILITY OF MISUSE OF THE MAILS AND HE BROUGHT THE MATTER TO THE ATTENTION OF THE POSTAL INSPECTORS. THE POSTAL INSPECTION SERVICE IS CONDUCTING AN INVESTIGATION, BUT THE INVESTIGATION MAY NOT BE COMPLETED BEFORE JULY 26, 1967, WHEN THE WAGE RATES EXPIRE. THE DEPARTMENT OF LABOR HAS BEEN REQUESTED TO EXTEND THE WAGE RATES. IS BELIEVED, HOWEVER, THAT THE EXTENSION, IF GRANTED, WOULD BE FOR 30 DAYS ONLY. UNDER THE INVITATION FOR BIDS,NOTICE TO PROCEED IS TO BE GIVEN ON OR ABOUT OCTOBER 1, 1967.

TETRO PROTESTS AN AWARD TO JONES, ALLEGING THAT THE LATE MODIFICATION WAS MAILED AFTER THE OPENING OF BIDS, BUT THAT JONES SOMEHOW MANIPULATED THE MAILS AND VIOLATED POSTAL LAWS AND REGULATIONS TO MAKE THE LATE MODIFICATION APPEAR ACCEPTABLE AND THEREBY DEFRAUD TETRO OF THE AWARD.

PARAGRAPH 2-303 OF THE ARMED SERVICES PROCUREMENT REGULATION, INCORPORATED AS PARAGRAPH 7 OF INSTRUCTIONS TO BIDDERS ACCOMPANYING THE INVITATION FOR BIDS, PROVIDES IN PERTINENT PART, AS FOLLOWS:

"2-303 LATE BIDS.

"2-303.1 GENERAL. BIDS WHICH ARE RECEIVED IN THE OFFICE DESIGNATED IN THE INVITATION FOR BIDS AFTER THE EXACT TIME SET FOR OPENING ARE LATE BIDS, - EVEN THOUGH RECEIVED ONLY ONE OR TWO MINUTES LATE. LATE BIDS SHALL NOT BE CONSIDERED FOR AWARD EXCEPT AS AUTHORIZED IN THIS PARAGRAPH 2 -303.

"2-303.2 CONSIDERATION FOR AWARD. A LATE BID SHALL BE CONSIDERED FOR AWARD ONLY IF:

(I) IT IS RECEIVED BEFORE AWARD; AND EITHER

(II) IT WAS SENT BY REGISTERED MAIL, OR BY CERTIFIED MAIL FOR WHICH AN OFFICIAL DATED POST OFFICE STAMP (POSTMARK) ON THE ORIGINAL RECEIPT FOR CERTIFIED MAIL HAS BEEN OBTAINED, * * * AND IT IS DETERMINED THAT THE LATENESS WAS DUE SOLELY TO A DELAY IN THE MAILS (BASED ON EVIDENCE PURSUANT TO 2-303.3) * * * .

"2-303.3 MAILED BIDS.

"/B) CERTIFIED MAIL. THE TIME OF MAILING OF A LATE BID MAILED BY CERTIFIED MAIL FOR WHICH A POSTMARKED RECEIPT FOR CERTIFIED MAIL WAS OBTAINED SHALL BE DEEMED TO BE THE LAST MINUTE OF THE DATE SHOWN IN THE POSTMARK ON SUCH RECEIPT, EXCEPT WHERE (1) THE RECEIPT FOR CERTIFIED MAIL IDENTIFIES THE POST OFFICE STATION OF MAILING AND THE BIDDER FURNISHES EVIDENCE FROM SUCH STATION THAT THE BUSINESS DAY OF THAT STATION ENDED AT AN EARLIER TIME, IN WHICH CASE THE TIME OF MAILING SHALL BE DEEMED TO BE THE LAST MINUTE OF THE BUSINESS DAY OF THAT STATION; OR (II) AN ENTRY IN INK ON THE RECEIPT FOR CERTIFIED MAIL, SHOWING THE TIME OF MAILING AND THE INITIALS OF THE POSTAL EMPLOYEE RECEIVING THE ITEM AND MAKING THE ENTRY, IS APPROPRIATELY VERIFIED IN WRITING BY THE POST OFFICE STATION OF MAILING, IN WHICH CASE THE TIME OF MAILING SHALL BE THE TIME SHOWN IN THE ENTRY. * * *

"/C) DELIVERY TIME. INFORMATION CONCERNING THE NORMAL TIME FOR MAIL DELIVERY SHALL BE OBTAINED BY THE PURCHASING ACTIVITY FROM THE POSTMASTER, SUPERINTENDENT OF MAILS, OR A DULY AUTHORIZED REPRESENTATIVE FOR THAT PURPOSE, OF THE POST OFFICE SERVING THAT ACTIVITY. WHEN TIME PERMITS, SUCH INFORMATION SHALL BE OBTAINED IN WRITING.'

COMMENT IS MADE THAT ALTHOUGH THE MAILING DOCUMENTS INDICATE THE POSSIBILITY OF SOME IRREGULARITY, THE EVIDENCE IS NOT CONCLUSIVE, AND IN THE ABSENCE OF A FINDING OF IRREGULARITY BY THE POSTAL INSPECTORS, IT APPEARS PROPER TO AWARD THE CONTRACT TO JONES. WE MAY OBSERVE, AT THIS POINT, THAT TETRO HAS OFFERED NO EVIDENCE HERE TO SUBSTANTIATE ITS ALLEGATION OF IRREGULARITY. IT IS YOUR SUGGESTION THAT ON THE BASIS OF THE PRESENT EVIDENCE AWARD BE MADE TO JONES BEFORE THE WAGE RATES EXPIRE ON JULY 26, 1967, AND THAT THE NOTICE TO PROCEED BE WITHHELD PENDING COMPLETION OF THE POSTAL INSPECTION SERVICE INVESTIGATION, AT WHICH TIME APPROPRIATE ACTION MAY BE TAKEN IN ACCORDANCE WITH THE RESULTS OF THE INVESTIGATION. IT IS ALSO SUGGESTED THAT IF IT IS LATER FOUND THAT JONES DID IN FACT MISUSE THE MAILS, THE CONTRACT COULD BE TERMINATED.

IT IS NOTED THAT IF THE DEPARTMENT OF LABOR GRANTS AN EXTENSION OF THE WAGE RATES, IT IS PROPOSED TO WITHHOLD AWARD FOR A FURTHER PERIOD OF TIME UNTIL THE EXTENDED WAGE RATES EXPIRE OR THE INVESTIGATION BY THE POSTAL INSPECTION SERVICE IS COMPLETED PRIOR TO THE NEW EXPIRATION DATE.

IN VIEW OF THE INCONCLUSIVENESS OF THE EVIDENCE, AND THE IMPORTANCE OF A FINDING AND REPORT OF THE POSTAL INSPECTION SERVICE, WE DO NOT OBJECT TO THE PROPOSED ACTION INDICATED ABOVE.