B-169916, JUL. 20, 1970

B-169916, JUL. 20, 1970

BID PROTEST -- REJECTION AND READVERTISEMENT DECISION DENYING PROTEST OF MARKWELL AND HARTS, INC. AGAINST CANCELLATION AND READVERTISEMENT OF PUMPING STATION AND FLOOD CONTROL PROJECT BY CORPS OF ENGINEERS, JACKSONVILLE, FLA., ON BASIS THAT SINCE WAGE RATES ON EXPIRATION OF ORIGINAL INVITATION WERE NOT CHANGED, LOW BIDDER WAS PREJUDICED ON READVERTISEMENT. WHERE BIDS ARE REJECTED BECAUSE OF EXCESSIVE PRICES AND EXPIRATION OF WAGE RATES, THE ISSUANCE OF A NEW INVITATION WITH AN IDENTICAL WAGE DETERMINATION MAY NOT BE REGARDED AS REVIVING THE ORIGINAL DETERMINATION NOR EXTENDING THE DETERMINATION. AFTER REJECTING ALL BIDS FOR EXCESSIVE PRICES, THERE WAS NO REASON FOR REQUESTING AN EXTENSION OF THE WAGE RATES. WHEN THE WAGE RATES HAVE EXPIRED AN AWARD MAY NOT BE MADE.

TO LOVETT, KUSCH & WIBLE:

WE REFER TO YOUR LETTER OF MAY 28, 1970, ON BEHALF OF MARKWELL AND HARTZ, INC., PROTESTING CANCELLATION OF INVITATION FOR BIDS NO. DACW 17 70-B-0055 AND READVERTISEMENT OF THE PROJECT UNDER IFB NO. DACW 17-70-B 0089 BY THE JACKSONVILLE DISTRICT, CORPS OF ENGINEERS, JACKSONVILLE, FLORIDA.

THE ORIGINAL INVITATION FOR PUMPING STATION 4, CENTRAL AND SOUTHERN FLORIDA FLOOD CONTROL PROJECT, WAS ISSUED FEBRUARY 5, 1970, AND BIDS WERE OPENED ON MARCH 19, 1970. THE GOVERNMENT ESTIMATE WAS $2,033,390.00. FOUR BIDS WERE RECEIVED AS FOLLOWS: BID NO. BIDDER'S NAME

AMOUNT 1. E. J. MURPHY AND CO., INC. $3,465,175.00 2. WILEY N. JACKSON CO. $3,385,560.00 3. MARKWELL AND HARTZ, INC. $2,661,525.00 4.

L & A CONTRACTING CO. $2,320,000.50

THE CONTRACTING OFFICER DETERMINED THE LOW BIDDER TO BE NONRESPONSIBLE AND REJECTED THE LOW BID BY LETTER DATED APRIL 22, 1970. THE NEXT LOW BID OF MARKWELL AND HARTZ EXCEEDED THE ADMINISTRATIVELY ESTABLISHED CEILING OF 25 PERCENT OVER THE GOVERNMENT ESTIMATE. IN THE ABSENCE OF A BASIS ON WHICH TO REQUEST APPROVAL OF AN INCREASE IN THE GOVERNMENT ESTIMATE, THE CONTRACTING OFFICER DETERMINED THAT THE BID OF MARKWELL AND HARTZ WAS UNREASONABLE AS TO PRICE AND DECIDED THAT IT WAS IN THE BEST INTEREST OF THE GOVERNMENT TO REJECT ALL BIDS AND READVERTISE THE PROJECT. MARKWELL AND HARTZ AND ALL OTHER BIDDERS WERE NOTIFIED BY LETTER DATED APRIL 22, 1970, OF THE REJECTION OF ALL BIDS AND THE INTENTION TO READVERTISE THE WORK.

ON APRIL 27, 1970, MARKWELL AND HARTZ PROTESTED TO THE CONTRACTING OFFICER THE REJECTION OF ALL BIDS. WHILE THIS PROTEST WAS PENDING, ON MAY 5, 1970, THE CONTRACTING OFFICER FURNISHED AN ADDITIONAL REASON FOR REJECTING ALL BIDS IN THAT THE DEPARTMENT OF LABOR WAGE DETERMINATION NO. AJ-8165, WHICH WAS A PART OF THE ORIGINAL INVITATION EXPIRED AT MIDNIGHT ON MAY 4, 1970. AFTER A CONFERENCE ON MAY 7, 1970, BETWEEN REPRESENTATIVES OF MARKWELL AND HARTZ AND THE CONTRACTING AGENCY, THE CONTRACTING OFFICER CONFIRMED BY LETTER OF MAY 8, 1970, THAT THE PROTEST WAS REJECTED AND RETURNED THE RELATED PAPERS.

ON MAY 12, 1970, THE PROJECT WAS READVERTISED UNDER IFB NO. DACW 17 70-B- 0089, WHICH INVITATION CONTAINED A NEW WAGE DETERMINATION NO. AJ 12854, ISSUED ON MAY 7, 1970, WHICH WAS IDENTICAL IN EVERY RESPECT TO THE WAGE DETERMINATION CONTAINED IN THE ORIGINAL INVITATION.

THE PROTEST IN YOUR LETTER OF MAY 28, 1970, TO OUR OFFICE IS LIMITED TO THE QUESTION OF THE PROPRIETY OF REJECTION OF ALL BIDS UPON EXPIRATION OF THE WAGE DETERMINATION IN THE ORIGINAL INVITATION. IT IS YOUR CONTENTION THAT SINCE THE WAGE RATES WERE NOT CHANGED IN THE SUBSEQUENT DETERMINATION, CANCELLATION OF THE ORIGINAL INVITATION SHOULD NOT BE REQUIRED AND IT WOULD SEVERELY PREJUDICE MARKWELL AND HARTZ AS THE LOW RESPONSIVE BIDDER IF CANCELLATION IS ALLOWED TO STAND.

ALTHOUGH YOUR PROTEST TO OUR OFFICE RELATES ONLY TO THE EFFECT OF EXPIRATION OF THE WAGE DETERMINATION, WE MUST TAKE COGNIZANCE OF THE FACT THAT THE PRIMARY REASON FOR REJECTION OF ALL REMAINING BIDS ON APRIL 22, 1970, WAS THAT THEY EXCEEDED THE GOVERNMENT ESTIMATE BY MORE THAN 25 PERCENT AND WERE THEREFORE CONSIDERED UNREASONABLE AS TO PRICE. WE HAVE LONG CONSIDERED THE CANCELLATION OF AN INVITATION AFTER BID OPENING TO BE A SERIOUS MATTER WHICH MUST BE JUSTIFIED BY COMPELLING OR COGENT REASONS, BUT WE HAVE HELD THAT SUCH CANCELLATION IS JUSTIFIED WHERE ALL BID PRICES ARE UNREASONABLE. 36 COMP. GEN. 364, 365 (1956); B-162541, DECEMBER 28, 1967.

ALTHOUGH THE EXPIRATION OF THE WAGE DETERMINATION WAS STATED AS AN ADDITIONAL REASON FOR CANCELLATION OF THE ORIGINAL INVITATION, THE PRACTICAL EFFECT OF SUCH EXPIRATION WAS TO RENDER ACADEMIC THE QUESTION RAISED BY ANY OTHER REASON FOR CANCELLATION. THEREAFTER THE INITIAL REASON FOR REJECTING ALL BIDS WAS SIGNIFICANT ONLY TO THE EXTENT THAT AFTER MAKING THE DECISION, THE CONTRACTING OFFICER HAD NO REASON FOR REQUESTING AN EXTENSION OF THE ORIGINAL WAGE DETERMINATION UNDER THE PROVISIONS OF ASPR 18-704.2A(5), SINCE NO AWARD WAS CONTEMPLATED UNDER THE INVITATION CONTAINING THAT WAGE DETERMINATION.

IN A SIMILAR CASE INVOLVING THE SUBSEQUENT ISSUANCE OF AN IDENTICAL WAGE DETERMINATION, 45 COMP. GEN. 325 (1965), WE HELD AT PAGE 329 *** IT IS OUR OPINION THAT THE GENERAL RULE, AS SET OUT IN 41 COMP. GEN. 593, IS FOR APPLICATION IN THE INSTANT CASE, AND THAT AN AWARD COULD NOT PROPERLY HAVE BEEN MADE ONCE THE WAGE DETERMINATION INCLUDED IN THE SPECIFICATIONS EXPIRED, UNLESS AND UNTIL AN EXTENSION HAD BEEN PROPERLY REQUESTED AND GRANTED. WE ARE THEREFORE UNABLE TO CONCLUDE THAT THE AUTOMATIC ISSUANCE OF A NEW WAGE DETERMINATION EMBODYING IDENTICAL WAGES EITHER REVIVED THE ORIGINAL DETERMINATION OR WAS, IN EFFECT, AN EXTENSION OF SUCH DETERMINATION."

ACCORDINGLY, WE FIND NO LEGAL BASIS UPON WHICH TO OBJECT TO CANCELLATION OF THE ORIGINAL INVITATION AND READVERTISING FOR BIDS ON THE PROJECT, AND YOUR PROTEST MUST THEREFORE BE DENIED.