B-173244, FEB 22, 1972, 51 COMP GEN 518

B-173244, FEB 22, 1972, 51 COMP GEN 518

CONTRACTS - SPECIFICATIONS - MINIMUM NEEDS REQUIREMENT - ERRONEOUSLY STATED THE AWARD OF A CONTRACT UNDER AN INVITATION FOR BIDS TO FURNISH A PLANT GROWTH CHAMBER COMPLEX TO THE LOW BIDDER WHO WAS NONRESPONSIVE TO THE SPECIFICATION DIMENSIONS SHOULD BE TERMINATED FOR THE CONVENIENCE OF THE GOVERNMENT, NOTWITHSTANDING THE CONTRACTING OFFICER BELIEVES THE OFFER SATISFIES THE NEEDS OF THE GOVERNMENT SINCE THE DEVIATION AFFECTS QUALITY AND PRICE AND, THEREFORE, THE AWARD WAS IMPROPERLY MADE. THE PROCUREMENT SHOULD BE RESOLICITED TO REFLECT THE GOVERNMENT'S ACTUAL NEEDS, AND THE REVISED SPECIFICATION SHOULD ELIMINATE BOTH THE OPEN ENDED DELIVERY PROVISION, BECAUSE IT DOES NOT PROVIDE A DEFINITE STANDARD AGAINST WHICH ALL BIDDERS CAN BE MEASURED OR ON WHICH ALL BIDS CAN BE BASED, AND THE CLAUSE ALLOWING MINOR BID DEVIATIONS IF LISTED AND SUBMITTED AS PART OF THE BID BEFORE BID OPENING, A CLAUSE THAT PREVENTS FREE AND EQUAL COMPETITIVE BIDDING. THE CANCELLATION ORIGINALLY DIRECTED WAS MODIFIED TO A TERMINATION IN B-173244, AUGUST 16, 1972.

TO THE SECRETARY OF AGRICULTURE, FEBRUARY 22, 1972:

REFERENCE IS MADE TO THE LETTER OF JULY 8, 1971, AND SUBSEQUENT CORRESPONDENCE, FROM THE ACTING DIRECTOR, OFFICE OF PLANT OPERATIONS, REGARDING THE PROTEST OF ENVIRONMENTAL GROWTH CHAMBERS AGAINST AWARD OF A CONTRACT TO SCIENTIFIC SYSTEMS CORPORATION, UNDER INVITATION FOR BIDS NO. 96-RN-ARS-71 ISSUED BY THE AGRICULTURAL RESEARCH SERVICE, NEW ORLEANS, LOUISIANA.

THE SOLICITATION, ISSUED ON APRIL 28, 1971, WAS FOR A PLANT GROWTH CHAMBER COMPLEX. THE FOLLOWING TWO BIDS WERE RECEIVED AND OPENED ON MAY 28, 1971:

SCIENTIFIC SYSTEMS CORPORATION (SSC) $54,804

ENVIRONMENTAL GROWTH CHAMBERS (EGC) 74,956

ON JUNE 9, 1971, THE CONTRACTING OFFICER RECEIVED A LETTER FROM EGC PROTESTING ANY AWARD TO THE LOW BIDDER. ON JUNE 14, 1971, AWARD WAS MADE TO SSC; LATER ON THE SAME DAY THE CONTRACTING OFFICER RECEIVED A COPY OF THE PROTEST FILED WITH THIS OFFICE, AND THE NEXT DAY REQUESTED THE CONTRACTOR TO WITHHOLD PERFORMANCE PENDING RESOLUTION OF THE PROTEST. THE CONTRACTING OFFICER STATES THAT HE PROCEEDED WITH THE AWARD ACTION ON JUNE 14, BEFORE RECEIVING THE FORMAL PROTEST, ON THE BASIS OF HIS UNDERSTANDING THAT EGC HAD DECIDED NOT TO FILE A FORMAL PROTEST BEFORE AWARD.

THE PROTESTOR URGES SEVERAL GROUNDS FOR CANCELLATION OF THE AWARD, INCLUDING NONRESPONSIVENESS OF SSC'S BID. IN ADDITION, THE SOLICITATION ITSELF IS ATTACKED AS DEFECTIVE.

THE SPECIFICATIONS REQUIRED THAT THE "INTERNAL CHAMBER DIMENSIONS SHALL BE NO LESS THAN 8 FEET WIDE *** ." THE SPECIFICATION SHEETS SUBMITTED BY SSC AS PART OF ITS BID, IN A SECTION HEADED "DIMENSIONS" WHICH WAS COMPLETED IN INK, INDICATE THAT THE WIDTH OF ITS CHAMBER IS 90 INCHES, 6 INCHES LESS THAN THE REQUIRED 8 FEET. THE DESCRIPTIVE LITERATURE WHICH ACCOMPANIED THE BID ALSO INDICATES AN "I.D." WIDTH OF 90 INCHES FOR THE MODEL OFFERED. THE PROTESTOR CLAIMS THAT THIS REPRESENTS A MATERIAL DEVIATION REQUIRING REJECTION OF THE LOW BID.

THE CONTRACTING OFFICER, HOWEVER, DENIES THAT THERE IS ANY DEVIATION. THE ADMINISTRATIVE REPORT STATES THAT THE LOW BIDDER'S SUBMISSION "SHOWS AN OUT-TO-OUT WIDTH DIMENSION OF 9 FEET 3 INCHES *** AND GROSS INTERNAL DETAILS OF EQUIPMENT INSTALLED ON BOTH INTERIOR SIDES OF THE GROWTH CHAMBER. ALTHOUGH NO DIMENSIONS ARE GIVEN FOR THE INTERNAL EQUIPMENT, A NOMINAL THICKNESS OF 4 INCHES FOR EACH WOULD RESULT IN A NET INTERNAL DIMENSION OF THE CHAMBER OF 103 INCHES *** . THIS IS WELL ABOVE THE MINIMUM REQUIREMENTS OF THE IFB *** ." THE CONTRACTING OFFICERS FURTHER STATES THAT THE LOW BIDDER, WHEN ASKED TO CLARIFY THE POINT, STATED THAT "THE GROSS INTERNAL FEATURE REPRESENTS THE AIR HANDLING DUCTS WHICH ARE NOT AN INTEGRAL PART OF THE CHAMBER WALL CONSTRUCTION AND THAT THE INTERNAL DIMENSION OF THE CHAMBER ITSELF (WALL-TO-WALL) IS INDEED 8 FEET 7 INCHES." THUS, IT IS THE POSITION OF THE CONTRACTING OFFICERS THAT THE SPECIFICATIONS REQUIRED A DISTANCE OF 96 INCHES FROM THE INSIDES OF THE EXTERIOR WALLS, WHILE THE PROTESTOR CLAIMS THAT 96 INCHES OF USABLE SPACE WITHIN THE CHAMBER WAS REQUIRED.

WE NOTE THAT SSC'S BID DOES NOT STATE A DIMENSION OF 103 INCHES. THE ONLY WIDTH DIMENSIONS CONTAINED IN ITS SPECIFICATION SHEETS ARE 111 INCHES IN THE COLUMN HEADED "O.D." AND 90 INCHES IN THE COLUMN HEADED "I.D." THIS SUGGESTS THAT SSC WAS NOT AWARE OF THE CONTRACTING OFFICER'S INTERPRETATION OF THIS SPECIFICATION REQUIREMENT, AND HAD NOT ADOPTED THAT INTERPRETATION AT THE TIME IT SUBMITTED ITS BID. FURTHERMORE, AT A MEETING HELD IN OUR OFFICE ATTENDED BY REPRESENTATIVES OF ALL THE PARTIES TO THE PROTEST, THE INDIVIDUAL RESPONSIBLE FOR DRAFTING THE SPECIFICATIONS IN THE IFB INDICATED THAT 96 INCHES OF USABLE SPACE WAS DESIRED, ALTHOUGH HE REFRAINED FROM STATING THAT THE IFB AS ISSUED ACTUALLY SPECIFIED THAT REQUIREMENT.

WE THINK THE ABOVE CIRCUMSTANCES INDICATE THAT SSC'S BID WAS NONRESPONSIVE. THE ONLY REASONABLE INTERPRETATION OF THE SPECIFICATION REQUIREMENTS IS THAT 96 INCHES OF USABLE SPACE WAS REQUIRED. THIS APPEARS TO BE THE ACCEPTED MEANING OF "INTERNAL CHAMBER DIMENSION" FOR PLANT GROWTH CHAMBERS AND IS THE APPARENT BASIC FOR THE VARIOUS "I.D." FIGURES LISTED IN SSC'S DESCRIPTIVE LITERATURE. SINCE SSC'S BID CLEARLY OFFERED AN INTERNAL WIDTH DIMENSION OF 90 INCHES, THE BID DEVIATED FROM THE SPECIFICATIONS, AND WE THINK THERE IS NO QUESTION THAT THIS DEVIATION IS MATERIAL AS AFFECTING QUALITY AND PRICE. SEE FPR 1-2.301 AND 1-2.404-2. FURTHERMORE, THE RECORD INDICATES THAT THE CONTRACTING OFFICER WAS UNABLE TO DEFINITELY ASCERTAIN THE RESPONSIVENESS OF THE BID, EVEN IN ACCORDANCE WITH HIS INTERPRETATION OF THE SPECIFICATIONS, WITHOUT ASSUMING A WALL THICKNESS AND WITHOUT SEEKING CLARIFICATION FROM SSC.

IN OUR OPINION THE LOW BID WAS CLEARLY NONRESPONSIVE TO THE SPECIFICATION REQUIREMENT FOR THE INTERNAL CHAMBER DIMENSION. ACCORDINGLY, WE CONCLUDE THAT THE AWARD WAS IMPROPERLY MADE TO THE LOW BIDDER AND SHOULD BE CANCELLED.

IN ADDITION, WE ARE CONCERNED OVER THE USE OF TWO CLAUSES IN THIS IFB WHICH WE BELIEVE TO BE DETRIMENTAL TO THE COMPETITIVE BIDDING SYSTEM. THE DELIVERY CLAUSE, ON PAGE 12 OF THE IFB DID NOT SET ANY DESIRED OR REQUIRED DATE OF DELIVERY BUT MERELY STATED:

NUMBER OF CALENDAR DAYS REQUIRED FOR DELIVERY AND FINAL INSTALLATION OF THE EQUIPMENT THEY PROPOSE TO FURNISH AFTER RECEIPT OF NOTICE OF AWARD: CALENDAR DAYS.

THE CONTRACTING OFFICER SUPPORTS THE USE OF THIS CLAUSE AS FOLLOWS:

WHEN TIME IS NOT OF THE ESSENCE IN THE PROCUREMENT OF EQUIPMENT, TO PLACE AN ARBITRARY DELIVERY TIME IN THE SOLICITATION WOULD HAVE THE NET EFFECT OF (1) ELIMINATING POTENTIAL BIDDERS WHO MAY NOT BE ABLE TO MEET SUCH A DEADLINE, (2) CAUSE SOME INCREASE IN BID PRICES, AND/OR (3) CREATE AN ATMOSPHERE FOR ACCEPTANCE OF STIPULATED DELIVERY TIME LIMITATION WITH THE EXPECTATION OF EXTENDING THE TIME LATER BY INCREMENTAL ADVANCES.

WE THINK THIS OPEN-ENDED DELIVERY PROVISION IS OBJECTIONABLE BECAUSE IT DOES NOT PROVIDE A DEFINITE STANDARD AGAINST WHICH ALL BIDDERS CAN BE MEASURED OR ON WHICH ALL BIDS CAN BE BASED. PUT ANOTHER WAY, THIS CLAUSE ALLOWS BIDDERS TO DETERMINE THE DELIVERY DATE WITHOUT ANY SPECIFIED LIMITATION WHATSOEVER, AND WE THINK IT IS REASONABLE TO ASSUME THAT A VARIATION IN OFFERED DELIVERY DATES CAN BE DIRECTLY RESPONSIBLE FOR VARIATIONS IN BID PRICES, THUS GIVING A BIDDER WHO OFFERS A LATER DELIVERY DATE A POSSIBLE PRICE ADVANTAGE. SHOULD THERE BE A WIDE VARIATION IN OFFERED DELIVERY DATES, THE CONTRACTING OFFICER WOULD NOT BE ABLE TO CONSIDER DELIVERY TIME IN MAKING AWARD SINCE IT WAS NOT SPECIFIED AS AN EVALUATION FACTOR, AND HE WOULD HAVE TO MAKE AWARD TO THE LOW RESPONSIVE BIDDER OR CANCEL THE SOLICITATION. 49 COMP. GEN. 713 (1970).

WE HAVE UPHELD INVITATIONS PERMITTING BIDDERS TO SELECT A DELIVERY DATE SO LONG AS THE DATE WAS WITHIN A STIPULATED OR REASONABLE TIME AFTER A "DESIRED" DATE SPECIFIED IN THE INVITATION. SEE 46 COMP. GEN. 745 (1967) AND CASES CITED. HOWEVER, WE HAVE MADE IT EMINENTLY CLEAR THAT A FAILURE TO INCLUDE A REQUIRED OR DESIRED DELIVERY DATE IN AN INVITATION IS IMPROPER AND GROUNDS FOR CANCELLATION. IN THE CITED CASE, THE IFB REQUESTED BIDDERS TO SPECIFY THE TIME FOR DELIVERY, BUT FURTHER PROVIDED THAT A FAILURE TO SO SPECIFY WOULD RESULT IN AN ALLOWABLE DELIVERY PERIOD OF 90 DAYS. WHILE WE HELD THAT THIS PROVISION WAS AMBIGUOUS BECAUSE IT WASN'T CLEAR IF A BIDDER COULD OFFER A DELIVERY DATE IN EXCESS OF 90 DAYS, WE ALSO STATED THAT:

*** AS A MATTER OF POLICY WE FEEL SUCH OPEN ENDED DELIVERY TERMS ARE UNWISE IN THAT THEY AFFORD AN OPPORTUNITY FOR THE ARBITRARY INCLUSION OR EXCLUSION OF BIDS. EVEN GRANTING IMPARTIAL CONSIDERATION, THESE UNDEFINED DELIVERY TERMS CAN ONLY RESULT IN UNEVEN AND UNPREDICTABLE TREATMENT OF BIDDERS BECAUSE REASONABLE MEN WILL DIFFER ON WHAT CONSTITUTES A REASONABLE DELIVERY DATE UNDER ANY GIVEN SET OF CIRCUMSTANCES. 46 COMP. GEN. 745, 748 (1967).

SEE ALSO 49 COMP. GEN. 713 (1970) AND FPR 1-1.316-2. ACCORDINGLY, WE STRONGLY URGE THAT IN FUTURE PROCUREMENTS A DEFINITE DELIVERY TIME BE SPECIFIED.

THE OTHER CLAUSE, CAUSING US CONCERN, WHICH ALLOWED BID DEVIATIONS OF MINOR IMPORTANCE, STATED:

BID DEVIATIONS

CONSIDERATION WILL BE GIVEN TO ITEMS OFFERED WHICH MAY DEVIATE FROM THE SPECIFICATION PARTICULARS PROVIDED SUCH DEVIATION IS SPECIFICALLY NOTED AND THAT THE DEVIATION FROM THE SPECIFICATION IS OF MINOR IMPORTANCE AND WILL NOT AFFECT THE ABILITY OF THE UNIT TO PERFORM UPON AN EQUAL BASIS WITH COMPETITIVE UNITS IN ITS CLASS, AND OTHERWISE FULFILL THE SERVICE REQUIREMENTS.

BIDDERS OFFERING EQUIPMENT OR MATERIAL WHICH DEVIATES FROM THE SPECIFICATION PARTICULARS SHALL PREPARE A LISTING OF SUCH DEVIATIONS WITH A CLEAR DESCRIPTION OF THE DEVIATIONS. IN ADDITION TO THE LISTING OF DEVIATIONS, BIDDERS SHALL FURNISH TECHNICAL INFORMATION, SUCH AS CUTS, ILLUSTRATIONS, DRAWINGS AND BROCHURES WHICH SHOW THE CHARACTERISTICS OR CONSTRUCTION OF A PRODUCT OR EXPLAIN ITS OPERATION. IF DESCRIPTIVE LITERATURE FURNISHED DOES NOT DESCRIBE IN DETAIL SALIENT ELEMENTS SPECIFIED HEREIN, ADDITIONAL INFORMATION SHALL BE PROVIDED WITH THE BID TO COVER THOSE ELEMENTS SO THAT THE GOVERNMENT CAN DETERMINE ACCEPTABILITY OF THE EQUIPMENT OR MATERIAL OFFERED. CUTS, ILLUSTRATIONS, DRAWINGS AND BROCHURES FURNISHED IN CONNECTION WITH DEVIATIONS LISTED SHALL BE IDENTIFIED TO SHOW THE ITEM IN THE BID TO WHICH IT PERTAINS. THE LISTING CONTAINING ALL DEVIATIONS AND RELEVANT DOCUMENTS SHALL BE FURNISHED AS A PART OF THE BID AND MUST BE RECEIVED BEFORE THE TIME SET FOR OPENING BIDS. BIDDERS FAILURE TO FURNISH LISTING OF DEVIATIONS OR EXCEPTIONS AND RELEVANT DOCUMENTS WITH THEIR BID, WILL BE CONSTRUED AS ACCEPTANCE OF THE PROVISIONS OF THE SOLICITATION REQUIREMENTS AND THE GOVERNMENT WILL DEMAND FULL AND COMPLETE COMPLIANCE WITH THE SOLICITATION REQUIREMENTS.

IN PRIOR CASES WE HAVE INDICATED THAT CLAUSES ALLOWING DEVIATIONS ARE OBJECTIONABLE BECAUSE THEY DO NOT GENERALLY PERMIT FREE AND EQUAL COMPETITIVE BIDDING. 39 COMP. GEN. 570 (1960); B-159579, JULY 20, 1966. WE BELIEVE THAT THE INSTANT CLAUSE IS OBJECTIONABLE FOR THE SAME REASONS, AND HAS NO PLACE IN A FORMALLY ADVERTISED PROCUREMENT.

WHILE SSC'S BID WAS NONRESPONSIVE, WE NOTE THAT THE CONTRACTING OFFICER BELIEVES THAT THE CHAMBER OFFERED BY SSC SATISFIES THE NEEDS OF THE GOVERNMENT. ACCORDINGLY, WE BELIEVE THE PROCUREMENT SHOULD BE RESOLICITED ON THE BASIS OF SPECIFICATIONS REVISED TO REFLECT THE ACTUAL NEEDS OF THE GOVERNMENT.