B-235207, Jul 14, 1989, 89-2 CPD 51

B-235207, Jul 14, 1989, 89-2 CPD 51

PROCUREMENT - Sealed Bidding - Invitations for bids - Cancellation - Justification - Minimum needs standards DIGEST: 1. Protest challenging cancellation of an invitation for bids (IFB) after bid opening is sustained where no compelling reason justified cancellation because award under the IFB would meet the needs of the government without prejudice to other bidders. PROCUREMENT - Sealed Bidding - Invitations for bids - Amendments - Acknowledgment - Waiver 2. A bidder's failure to sign its bid and three of four amendments may be waived as minor informalities where one amendment incorporating a Department of Labor wage determination was signed and the other amendments were either not material or the bidder's intent to be bound was evident.

Bonded Maintenance Co., Inc.:

Bonded Maintenance Co., Inc., protests the cancellation of invitation for bids (IFB) No. WRO-89-B-1, issued by the Immigration and Naturalization Service (INS), Department of Justice, for janitorial services at the San Diego Border Patrol Sector buildings. Bonded contends that the cancellation was improper because the deficiencies in the solicitation did not constitute a compelling reason to cancel the solicitation. Bonded also maintains that, contrary to the contracting agency's determination, its bid was responsive.

We sustain the protest.

The IFB, issued November 18, 1988, was synopsized in the Commerce Business Daily (CBD) as a small business set-aside and sent to 73 firms. INS issued four amendments to the IFB and received 16 bids by the January 24, 1989, bid opening. Bonded was the low bidder at $162,774. Following review of the procurement prior to award, the agency determined that the following deficiencies in the IFB constituted a compelling reason to cancel the solicitation: the lack of a designated minimum bid acceptance period; the omission from the CBD synopsis of a specific note indicating that the procurement was a 100 percent small business set-aside and identifying the duration of the base and option periods; and the absence of three mandatory contract provisions. The agency also noted that it lacked a written advance procurement plan. Accordingly, INS canceled the IFB on March 31. The agency also concluded that Bonded's failure to sign its bid and acknowledge two of four amendments rendered its bid nonresponsive.

As explained below, none of the reasons offered to justify IFB cancellation is sufficient, under the circumstances here, to warrant cancellation after bid opening. We also find that Bonded's bid was responsive.

CANCELLATION OF THE IFB

Because of the potential adverse impact on the competitive bidding system of cancellation after bid prices have been exposed, a contracting agency must have a compelling reason to cancel an IFB after bid opening. Federal Acquisition Regulation (FAR) Sec. 14.404 1(a)(1).

INS first justifies cancellation of the IFB because of the contracting officer's failure to insert a specific number of calendar days in the standard minimum bid acceptance period clause, FAR Sec. 52.214-16, included in the IFB. The IFB stated that this clause superseded the provision in Block 12 of Standard Form (SF) 33 which provides for a 60 calendar day acceptance period unless the bidder specifies otherwise. (The contracting officer had marked "N/A" in the blank in Block 12 for insertion of other than a 60 calendar day acceptance period.) The agency concluded that because of this omission, Bonded's bid may not have been valid and the bidders did not compete on a common basis.

We find that although a minimum bid acceptance period was not specified by the agency, and none of the bidders, including Bonded, included an acceptance period in their bids, bidders were not prejudiced by INS' error. Although bidders were free to insert an alternative acceptance period in the clause, none did; neither did any bidder withdraw its bid prior to the IFB cancellation. Accordingly, no bidder assumed a greater risk of price or market fluctuation than did Bonded or any other bidder. Moreover, no bidder questioned the omission of the minimum bid acceptance period, or protested the omission to INS or our Office before bid opening.

Once bids have been opened and prices exposed, the fact that a particular provision of an IFB is defective does not, per se, require cancellation of the IFB. We generally regard cancellation as inappropriate when other bidders would not be prejudiced by an award under the ostensibly deficient solicitation and when such an award would serve the actual needs of the government. Dyneteria, Inc.; Tecom, Inc., B-210684; B-210684.2, Dec. 21, 1983, 84-1 CPD Sec. 10. Accordingly, we find that the omission of a minimum bid acceptance period from the IFB here was not a compelling reason justifying cancellation of the IFB since award under the solicitation would meet the needs of INS without prejudice to any bidder.

The agency's second reason for cancellation concerns the synopsis of the procurement published in the CBD. The synopsis stated that the proposed acquisition of cleaning services was a "small business set aside," but did not state that it was a "100 percent" small business set-aside, did not include the standard notation applicable to such set asides, and did not indicate the duration of the base or option periods as required by FAR Sec. 5.207(c) and (d).

A defective CBD notice can render a procurement defective. See, e.g., Frank Thatcher Assocs., Inc., 67 Comp.Gen. 77 (1987), 87-2 CPD Sec. 480. However, we see no reason why the synopsis here warrants cancellation. The purpose of the CBD notice is to publicize proposed procurements to potential offerors. In response to the synopsis that was published, INS received 26 requests for the IFB and, after sending the IFB to 73 firms, received bids from 16 small businesses. Further, no one has complained about being misled by the notice. Thus, there is simply no evidence of prejudice to any one here because of the defects in the CBD notice. Accordingly, we find that the defective CBD notice did not constitute a compelling reason sufficient to justify cancellation of the solicitation.

INS' last reason for cancellation is the omission of the following mandatory contract clauses from the IFB: the provisions for a drug free workplace; the provision regarding taxes on contracts performed in United States possessions or Puerto Rico; and the prompt payment provision. addition, INS states that the contract file did not contain a written acquisition plan.

The Drug-Free Workplace certification and compliance clauses, FAR Sec. 52.223-5, -6, that implement the Drug-Free Workplace Act of 1988, Pub.L. No. 100-690, Sec. 5152(a)(1), 102 Stat. 4304 (1988), require each contractor to certify compliance with the statute's requirements regarding a drug-free work environment. FAR Sec. 23.500. That certification is a responsibility requirement, in accordance with the Act's provision that a contractor shall not be considered a "responsible source" unless it certifies that it will provide a drug free workplace, and the implementing regulations, which provide that if the solicitation does not contain the certification, the contracting officer shall obtain the certification prior to award. FAR Sec. 23.505(d); Universal Hydraulics, Inc., B-235006, June 21, 1989, 89-1 CPD Sec. ***. Since the Act and the implementing regulations, by their own terms, permit a contracting officer to accept a contractor's certification up until the time of award, omission of the clauses from the IFB provides no basis for canceling the solicitation.

With respect to the omission of the provision regarding taxes on contracts performed in the United States possessions or Puerto Rico, it is clear that this clause had no relevance to a contract to be performed in the mainland United States and therefore no bidder was prejudiced by its omission.

The Prompt Payment clause, FAR Sec. 52.232-25, was required to be included in the IFB pursuant to FAR Sec. 32.908(c). The clause essentially provides that the government must pay interest penalties on overdue contract payments, and that the required payment due date is that specified in the contract, or, if none is specified, the 30th day after receipt of a proper invoice. The clause thus is principally for benefit of the contractor. Here, none of the bidders objected to the omission of the clause. Moreover, since the protester's bid was silent as to payment terms, the protester did not attempt to gain any competitive advantage over the other bidders in this area. Since there is no evidence that bidders were prejudiced by omission of the clause, or that the actual needs of INS will not be served by award to Bonded, we do not believe that this omission rendered the IFB so defective as to require cancellation. See Ashland Chemical Co., B-216954, May 16, 1985, 85-1 CPD Sec. 555.

Finally, it is clear that INS' failure to include an advance procurement plan in the contract file had no bearing on the preparation or evaluation of bids, and thus was not prejudicial to the bidders in any way. Accordingly, the lack of an advance procurement plan provides no basis for canceling the IFB.

In short, we find none of the reasons proffered by the agency for canceling the IFB, either individually or taken together, sufficient to warrant cancellation in this case.

RESPONSIVENESS OF BONDED'S BID

As explained further below, we also find that Bonded's bid was responsive despite the company's failure to sign the bid or return with its bid two of the amendments to the IFB.

A bid that is not signed generally must be rejected as nonresponsive because, without an appropriate signature, a bidder would not be obligated upon the government's acceptance of the bid. Inge Ellefson, B-212785, Sept. 2, 1983, 83-2 CPD Sec. 303. There is, however, an exception to this general rule that allows for waiver of the failure to sign the bid as a minor informality when the bid is accompanied by other documentation signed by the bidder (such as a properly executed bid bond or an amendment
bearing the bidder's signature) which clearly evinces the bidder's intent
to be bound by the bid submitted.
FAR Sec. 14.405(c)(1); Wilton Corp., 64
Comp.Gen. 233 (1985), 85-1 CPD Sec. 128.

Here, Bonded signed and returned with its bid amendment No. 2, which
incorporated the Department of Labor wage determination.
Accordingly,
Bonded's failure to sign its bid was a minor informality since Bonded's
signature on the amendment clearly evinced Bonded's intent to be obligated
upon the government's acceptance of the bid.
Wilton Corp., 64 Comp.Gen.
233, supra.

With respect to Bonded's failure to return the remaining amendments, INS
indicated on SF 30, the solicitation amendment form used for all four
amendments, that the bidders were not required to return the amendments.
INS also did not fill in the blank indicating how many copies of the
amendments were to be returned to the issuing office.
Accordingly, Bonded
did not acknowledge amendment No. 1, which added bi weekly and monthly
exterior services but did not include a pricing table for those tasks;
amendment No. 3, which extended the bid opening date to January 24, 1989,
and added Schedule B, a pricing table which included the new tasks added
by previous amendment; or amendment No. 4, which reduced the estimated
square footage of one of eleven areas to be cleaned to correctly reflect
the dimensions shown in the specification drawings included in the
solicitation.

A bidder's failure to acknowledge a material IFB amendment renders the
bid nonresponsive, since absent such an acknowledgment the government's
acceptance of the bid would not legally obligate the bidder to meet the
government's needs as identified in the amendment.
Maintenance Pace
Setters, Inc., B-213595, Apr. 23, 1984, 84-1 CPD Sec. 457.
An amendment
is material, however, only if it would have more than a trivial impact on
price, quantity, quality, delivery, or the relative standing of the
bidders.
FAR Sec. 14.405; Wirco, Inc., 65 Comp.Gen. 255 (1986), 86-1 CPD
Sec. 103.
An amendment is not material where it does not impose any legal
obligations on the bidder different from those imposed by the original
solicitation, such as where the amendment merely clarifies an existing
requirement.
Site Development, Inc., B-232813, Dec. 22, 1988, 88-2 CPD
Sec. 620.
In that case, the failure to acknowledge the amendment may be
waived as a minor informality and the bid may be accepted.
Emmett R.
Moody, 63 Comp.Gen. 182 (1984), 84-1 CPD Sec. 123.

Moreover, constructive acknowledgment of an amendment is an exception to
the general rule that a bidder's failure to acknowledge a material
amendment requires the agency to reject the bid as nonresponsive.
applies when the bid itself includes one of the essential items appearing
only in the amendment, such as a price for an item that was added by
amendment.
See N.B. Kenney Co., Inc., 65 Comp.Gen. 265 (1986), 86-1 CPD
Sec. 124.
This principle is consistent with the regulatory provision that
permits a bidder's failure to return an amendment to be waived as a minor
informality if the bid clearly indicates that the bidder received the
amendment.
FAR Sec. 14.405(d)(1).

INS concluded that amendment Nos. 3 and 4 were material and that Bonded's
failure to acknowledge them required INS to reject Bonded's bid.
We do
not agree.
Amendment No. 3 was issued to provide a new pricing schedule
that included certain services added by amendment No. 1 and to extend the
bid opening date.
Although Bonded failed to return the amendment with its
bid, it did include the new pricing schedule in its bid, thereby
constructively acknowledging receipt of the amendment and indicating its
intent to be bound.
Nuclear Research Corp., Ridgeway Electronics, Inc.,
B-200793; B-200793.2, June 2, 1981, 81-1 CPD Sec. 437.
Amendment No. 4
corrected an inconsistency in the estimated square footage requirements
for one of eleven areas covered in the solicitation, reducing the estimate
from 6,100 to 1,741 square feet, a ten percent reduction in total
estimated interior area to be cleaned.
However, the solicitation also
included drawings that provided specific dimensions for each room in each
of the eleven areas, to be utilized by offerors in determining square
footage for each area.
Accordingly, the amendment did not change the
requirements of the original solicitation, which provided bidders with
specific drawings upon which to base their bids; rather, it merely
corrected an error in the agency's estimate of the square footage of that
area in the narrative section of the statement of work.
Since the
amendment merely clarified an existing requirement and did not impose a
different legal obligation on the bidder, we conclude that the amendment
was not material and that Bonded's failure to return it with its bid may
be waived as a minor informality.
Site Development, Inc., B-232813,
supra; Emmett R. Moody, 63 Comp.Gen. 182, supra.

In view of our findings that INS did not have a compelling reason to
cancel the IFB and that Bonded's bid was responsive, we recommend that the
IFB be reinstated and award made to Bonded, the low responsive bidder,
provided that Bonded is found to be a responsible firm.
We also find that
Bonded is entitled to the costs of filing and pursuing the protest,
including attorneys' fees.
Bid Protest Regulations, 4 C.F.R. Sec.
21.6(d)(1) (1988).

The protest is sustained.