B-165608, FEB. 12, 1969

B-165608, FEB. 12, 1969

TO ORCO MANUFACTURING COMPANY:

REFERENCE IS MADE TO YOUR TELEGRAM OF NOVEMBER 8, 1968, AND LETTER OF DECEMBER 7, 1968, PROTESTING THE AWARD OF A CONTRACT UNDER REQUEST FOR PROPOSALS (RFP) NO. N00228-69-R-1804 ISSUED BY THE NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA.

THE REQUEST FOR PROPOSALS WAS ISSUED ON JULY 22, 1968, TO 10 POTENTIAL OFFERORS FOR PROCUREMENT OF 152 ASSORTED CHEMICAL WARFARE LOCKERS. THE RFP WAS ISSUED PURSUANT TO A DETERMINATION BY THE CONTRACTING OFFICER ON JULY 12, 1968, TO UTILIZE NEGOTIATED PROCUREMENT IN ACCORDANCE WITH THE NATIONAL EMERGENCY AUTHORITY OF 10 U.S.C. 2304 (A) (2). AS A RESULT OF A SYNOPSIS OF THE REQUEST FOR PROPOSALS WHICH WAS PUBLISHED IN THE DEPARTMENT OF COMMERCE DAILY BUSINESS JOURNAL, 43 ADDITIONAL FIRMS REQUESTED PROPOSAL FORMS.

AFTER THE REQUEST FOR PROPOSALS WAS ISSUED SEVERAL FIRMS REQUESTED CLARIFICATION OF THE DIE NUMBERS SHOWN ON PLAN NO. CVA41-608-2030695 AS APPLICABLE TO PIECES NOS. 14, 19, 20 AND 21. HOWEVER, NO INFORMATION WAS AVAILABLE FOR DISSEMINATION TO OFFERORS AS TO THE MEANING OF THOSE DIE NUMBERS. FOR THAT REASON, AMENDMENT NO. 2 TO THE REQUEST WAS ISSUED ON AUGUST 23, 1968, DELETING ALL REFERENCES TO THE DIE NUMBERS IN QUESTION AND PROVIDING AN ALTERNATE DESCRIPTION OF PERFORMANCE REQUIREMENTS. THE PROCUREMENT AGENCY STATES THAT ITS RECORDS SHOW THAT ALL AMENDMENTS WERE SENT TO THE 53 SOLICITED FIRMS.

YOUR COMPANY SUBMITTED THE LOWEST PROPOSAL BUT IT WAS NOT SUPPORTED BY ANY ACKNOWLEDGMENT OF AMENDMENTS 1 THROUGH 3 OF THE SOLICITATION. THE NAVY THEREFORE CONSIDERED YOUR PROPOSAL NONRESPONSIVE AND MADE AWARD TO THE THIRD LOW OFFEROR, THE SECOND LOW OFFEROR HAVING WITHDRAWN HIS PROPOSAL.

YOU STATE THAT YOUR COMPANY FAILED TO RECEIVE THE AMENDMENTS AND THEREFORE COULD NOT HAVE ACKNOWLEDGED THEIR RECEIPT. WHILE THE GOVERNMENT MAKES EVERY EFFORT TO SEE THAT INTERESTED BIDDERS RECEIVE TIMELY COPIES OF SOLICITATIONS AND AMENDMENTS, INADVERTENT FAILURE TO RECEIVE SUCH DOCUMENTS IN A PARTICULAR CASE DOES NOT WARRANT CONSIDERATION OF A BID IN CONTRAVENTION OF THE WELL-ESTABLISHED GENERAL RULE THAT THE FAILURE OF A BIDDER TO ACKNOWLEDGE RECEIPT OF AN AMENDMENT PRIOR TO BID OPENING RENDERS A BID NONRESPONSIVE WHERE SUCH AMENDMENT PRODUCES A MATERIAL CHANGE. COMP. GEN. 490; 37 ID. 785; B-159461, DECEMBER 2, 1966.

HERE, IT IS CLEAR THAT THE AMENDMENTS WERE MATERIAL FROM AN EXAMINATION OF THE ORIGINAL SOLICITATION AND THE AMENDMENTS. UNDER THE ORIGINAL SOLICITATION PROSPECTIVE OFFERORS WERE REQUESTED TO SUBMIT PROPOSALS ON THE BASIS OF SEVERAL DIE NUMBERS AS APPLIED TO PIECES NOS. 14, 19, 20 AND 21 CONTAINED IN PLAN NO. CVA41. THE AMENDMENTS BY DELETING REFERENCES TO THE DIE NUMBERS AND APPLYING THE INSTRUCTIONS CONTAINED IN GENERAL NOTE 9 OF PLAN CVA41 TO THE PREVIOUSLY MENTIONED PIECE NUMBERS MADE CLEAR TO PROSPECTIVE OFFERORS THE REQUIREMENTS OF THE REQUISITIONING ACTIVITY. PROPOSAL SUBMITTED ON THE BASIS OF THE INITIAL REQUEST FOR PROPOSALS WITHOUT ACKNOWLEDGEMENT OF RECEIPT OF THE AMENDMENTS WOULD THEREFORE BE AMBIGUOUS AND WOULD JUSTIFY THE SOLICITING AGENCY'S DETERMINATION THAT THE PROPOSAL WAS NOT CLEARLY RESPONSIVE.

THE DECISIONS OF OUR OFFICE CITED ABOVE, HOWEVER, ALL HAVE REFERENCE TO RULES AFFECTING ADDENDA UNDER FORMALLY ADVERTISED PROCUREMENTS. IN A NEGOTIATED PROCUREMENT, SUCH AS IS INVOLVED HERE, THE RULES OF COMPETITIVE BIDDING ARE NOT GENERALLY APPLICABLE, ALTHOUGH THEY MAY SERVE AS GENERAL GUIDELINES IN CASES WHERE THEIR APPLICATION SERVES THE BEST INTEREST OF THE GOVERNMENT. IN THIS REGARD, SEE 47 COMP. GEN. 279 IN WHICH THE FOLLOWING STATEMENT APPEARS:

"* * * NEGOTIATION PROCEDURES, UNLIKE THOSE REQUIRED FOR FORMAL ADVERTISING, ARE DESIGNED TO BE FLEXIBLE AND INFORMAL. THESE PROCEDURES PROPERLY PERMIT THE CONTRACTING OFFICER TO DO THINGS IN THE AWARDING OF A NEGOTIATED CONTRACT THAT WOULD BE A RADICAL VIOLATION OF THE LAW IF THE PROCUREMENT WERE BEING ACCOMPLISHED BY FORMAL ADVERTISING. * * *"

AS A GENERAL RULE, WE CANNOT AGREE THAT A FAILURE TO ACKNOWLEDGE AN ADDENDUM IN A NEGOTIATED PROCUREMENT WOULD NECESSARILY PRECLUDE CONSIDERATION OF THE AFFECTED PROPOSAL. IN THE NORMAL NEGOTIATED PROCUREMENT, THE ACKNOWLEDGMENT OF THE RECEIPT OF AN ADDENDUM AS WELL AS ANY CHANGES IN THE PROPOSAL PRICE OF A GIVEN OFFEROR BROUGHT ABOUT BY THE ADDENDUM PROPERLY MAY BE THE SUBJECT OF NEGOTIATIONS PROVIDED OTHER OFFERORS OR THE GOVERNMENT ARE NOT PREJUDICED THEREBY. THEREFORE, STRICT APPLICATION OF THE LATE ADDENDUM RULE IS NOT APPROPRIATE IN EVERY CASE INVOLVING A NEGOTIATED PROCUREMENT, DEPENDENT, OF COURSE, UPON THE PARTICULAR AND UNIQUE CIRCUMSTANCES INVOLVED.

IN THE CASE AT HAND, HOWEVER, OFFERORS WERE SPECIFICALLY ADVISED IN THE SOLICITATION THAT AMENDMENTS HAD TO BE ACKNOWLEDGED AND STANDARD FORM 30, THE NOTIFICATION OF AMENDMENT FORM, WARNED OFFERORS THAT FAILURE TO ACKNOWLEDGE RECEIPT OF AN AMENDMENT "MAY RESULT IN REJECTION OF YOUR OFFER.' FURTHER, THE SOLICITATION PROVIDED IN PARAGRAPH 10 (G) OF THE INSTRUCTIONS AND CONDITIONS THAT:

"THE GOVERNMENT MAY AWARD A CONTRACT, BASED ON INITIAL OFFERS RECEIVED, WITHOUT DISCUSSION OF SUCH OFFERS. ACCORDINGLY, EACH INITIAL OFFER SHOULD BE SUBMITTED ON THE MOST FAVORABLE TERMS FROM A PRICE AND TECHNICAL STANDPOINT WHICH THE OFFEROR CAN SUBMIT TO THE GOVERNMENT.'

SEE 47 COMP. GEN. 459, INVOLVING A SUBSTANTIALLY SIMILAR PROTEST AGAINST AN AWARD UNDER NEGOTIATION PROCEDURES.

SINCE THE NAVY RESERVED THE RIGHT TO MAKE AN URGENT AWARD "BASED ON INITIAL OFFERS RECEIVED, WITHOUT DISCUSSION OF SUCH OFFERS," IT WOULD HAVE CLEARLY CREATED A COMPETITIVE DISADVANTAGE IF NEGOTIATIONS WERE CONDUCTED WITH ONLY ONE OFFEROR WHOSE PROPOSAL DID NOT MEET THE GOVERNMENT AMENDED REQUIREMENTS. IN THIS CASE, SUCH NEGOTIATION WITH YOUR COMPANY WOULD HAVE BEEN NECESSARY TO RESOLVE THE AMBIGUITY CREATED BY YOUR FAILURE TO ACKNOWLEDGE RECEIPT OF THE AMENDMENTS TO THE SOLICITATION.

IN VIEW OF THE REPORTED URGENCY OF THE PROCUREMENT (SEE ASPR 3-805.1 (A)(III) (, WE ARE OF THE OPINION THAT THE ACTION OF THE CONTRACTING OFFICER IN AWARDING A CONTRACT ON THE BASIS OF THE TIMELY SUBMITTED OFFERS, AS AMENDED, IS NOT SUBJECT TO QUESTION BY OUR OFFICE.