B-136653, JUL. 14, 1958

B-136653, JUL. 14, 1958

TO THE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO A LETTER DATED JUNE 27, 1958, WITH ENCLOSURES, FROM THE ADMINISTRATIVE ASSISTANT SECRETARY, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH MR. JOHN T. BAKOS, D/B/A OIL FIELD CONSTRUCTION, ALLEGES WAS MADE IN HIS BID OPENED ON JUNE 4, 1958.

THE BUREAU OF LAND MANAGEMENT, DENVER, COLORADO, BY INVITATION NO. 58-92 REQUESTED BIDS FOR FURNISHING LABOR AND MATERIALS AND FOR PERFORMING THE WORK REQUIRED FOR THE CONSTRUCTION OF ONE EARTHFILL DETENTION DAM, INCLUDING CORRUGATED PIPE OUTLET STRUCTURE, AT DIVIDE CREEK DETENTION DAM, CRAIG, COLORADO. THE WORK TO BE PERFORMED WAS DIVIDED INTO FIVE ITEMS FOR THE PURPOSES OF SUBMITTING BIDS AND MAKING PAYMENT FOR THE WORK. RESPONSE MR. JOHN T. BAKOS, D/B/A OIL FIELD CONSTRUCTION, SUBMITTED A BID OFFERING TO PERFORM THE VARIOUS ITEMS OF WORK AT THE UNIT AND LUMP-SUM PRICES SET FORTH OPPOSITE EACH ITEM, WHICH PRODUCED AN AGGREGATE TOTAL BID OF $13,923.35. THE FIVE OTHER AGGREGATE BIDS ON THE PROJECT RANGED FROM $17,426.52 TO $32,471.23 AND THE GOVERNMENT'S ESTIMATE OF THE COST OF THE WORK WAS $16,133.76.

IN A REPORT DATED JUNE 16, 1958, THE AREA ADMINISTRATOR (CONTRACTING OFFICER) STATED THAT WHILE THE BIDS WERE UNDER CONSIDERATION, WITH PRELIMINARY ARRANGEMENTS BEING MADE FOR AWARD OF CONTRACT TO JOHN BAKOS, HIS OFFICE WAS ADVISED THAT MR. BAKOS DESIRED A CONFERENCE FOR THE PURPOSE OF DISCUSSING AN ERROR ALLEGED TO HAVE BEEN MADE IN HIS BID; THAT ON JUNE 11, 1958, AT A CONFERENCE HELD IN HIS OFFICE, MR. BAKOS RELATED THAT HIS BID HAD BEEN PREPARED UNDER SOME PRESSURE BECAUSE OF HIS POOR PHYSICAL CONDITION AT THAT TIME, AND HIS INEXPERIENCE IN BIDDING ON GOVERNMENT WORK; THAT IN HIS WORKSHEETS HE HAD INCLUDED AN ITEM OF COST AMOUNTING TO $3,500 FOR RENTAL OF EQUIPMENT HE INTENDED TO SECURE FROM OTHERS, CERTAIN OVERHEAD EXPENSES, UNSKILLED LABOR, MOVING COSTS, AND CONTINGENCIES; THAT IT WAS HIS INTENTION TO PRO-RATE THIS $3,500 COST COMPONENT AMONG ITEMS 1, 2 AND 5 OF THE BID SCHEDULE, BUT THAT THROUGH AN OVERSIGHT THIS COST COMPONENT HAD NOT BEEN CARRIED INTO HIS BID; AND THAT HE COULD NOT SAY WHAT AMOUNT OF THE $3,500 FIGURE WOULD HAVE BEEN DISTRIBUTED TO EACH OF THE BID ITEMS AND, THEREFORE, COULD NOT SAY PRECISELY WHAT THE UNIT PRICES FOR THESE ITEMS WOULD HAVE BEEN HAD THE ERROR NOT BEEN MADE. MR. BAKOS ALSO STATED AT THE CONFERENCE THAT EVEN WITH THE $3,500 COST COMPONENT INADVERTENTLY OMITTED FROM HIS BID, HIS BID WOULD HAVE BEEN ON THE BASIS OF REIMBURSEMENT OF COST OF PERFORMANCE ONLY AND WOULD NOT HAVE RESULTED IN A PROFIT TO HIM; AND THAT WITHOUT THE $3,500 COST COMPONENT HE COULD PERFORM THE CONTRACT ONLY AT A SUBSTANTIAL LOSS, AND WOULD PROBABLY HAVE SERIOUS DIFFICULTY IN SECURING A PERFORMANCE BOND INASMUCH AS HE WOULD HAVE TO DISCLOSE TO THE BONDING COMPANY THE ERROR MADE IN HIS BID, AND HIS FINANCIAL CONDITION WAS SUCH THAT HE MIGHT BE UNABLE TO SECURE BOND ON A CONTRACT INVOLVING SUCH PROSPECTIVE LOSSES.

IN AN AFFIDAVIT DATED JUNE 12, 1958, IN WHICH HE REQUESTED THAT HIS BID BE DISREGARDED, MR. BAKOS RECITED FACTS SUBSTANTIALLY THE SAME AS THOSE STATED BY HIM IN THE CONFERENCE HELD ON JUNE 11, 1958. IT WAS ALSO STATED BY HIM THAT HE WAS UNABLE TO LOCATE ALL THE ORIGINAL PAPERS, THE BID HAVING BEEN HASTILY PREPARED AT THE DENVER FEDERAL CENTER USING PAPER TOWELS AS SCRATCH PAPER, AND THE WORKSHEETS CONTAINING ORIGINAL COMPUTATIONS HAVING BEEN DISCARDED. IN SUPPORT OF HIS ALLEGATION OF ERROR, MR. BAKOS SUBMITTED HIS WORKSHEET IN THE FORM OF A COPY OF THE INVITATION. THE WORKSHEET CONTAINS THE UNIT PRICES AS SUBMITTED, ADDING UP TO A TOTAL BID OF $13,923.35, BUT WITH THE PENCILLED NOTICE "PLUS 3500 FOR EXTRA LABOR AND MOVING" AND WITH COMPUTATIONS SHOWING THAT WITH THIS $3,500 ADDED, THE BID WOULD TOTAL $17,423.35. ON THE BACK OF THE FACE SHEET OF THE COPY OF THE BID FORM, WHICH WAS USED AS MR. BAKOS' WORKSHEET, APPEARS THE FIGURE $13,923.35" IN INK WITH THE ADDITIONAL FIGURES "PLUS $3,500" PENCILLED IN.

ON THE RECORD, THERE IS NO GROUND FOR DISAGREEMENT WITH THE CONCLUSION OF THE AREA ADMINISTRATOR THAT MR. BAKOS MADE AN ERROR IN HIS BID, AS ALLEGED. ACCORDINGLY, SINCE THE ERROR WAS ALLEGED AND EXPLAINED PRIOR TO AWARD, THE BID OF MR. BAKOS MAY BE DISREGARDED IN MAKING THE AWARD.

THE PAPERS, WITH THE EXCEPTION OF THE STATEMENT OF THE AREA ADMINISTRATOR DATED JUNE 16, 1958, ARE RETURNED.