Fishermen's Boat Shop, Inc.

Matter of: Fishermen's Boat Shop, Inc. File: B-252560 Date: July 9, 1993

PROCUREMENT Sealed Bidding Low bids Error correction Price adjustments Propriety Where agency reasonably concluded that the awardee presented clear and convincing evidence of a mistake in its bid and the intended bid price and the bid is low with or without correction, agency properly allowed bidder to correct the mistake and increase its price.

Attorneys

DECISION Fishermen's Boat Shop, Inc. protests the award of a contract to Keet Marine under invitation for bids (IFB) No. DTCG85-93-B-625U01, issued by the United States Coast Guard, Department of Transportation, for dockside repairs to the USCGC Mellon. Fishermen's Boat contends that the agency improperly permitted Keet Marine, the low bidder, to correct a mistake in its bid.

We deny the protest.

The IFB required bidders to submit prices for 27 line items. Bid opening was scheduled for January 5, 1993. Of the four bids received, Keet Marine's bid of $309,735 was low, and Fishermen's Boat's bid of $421,802 was next low. The government estimate for the contract work was $382,462. Because Keet Marine's bid was substantially lower than the government estimate and the other bids received, the contracting agency requested that Keet Marine review its bid worksheets for possible errors. By letter dated January 25, Keet Marine advised the contracting officer that subcontractor costs for six line items (totaling $60,435) were inadvertently omitted from its bid and requested that it be permitted to correct its bid.

To support the request for correction, Keet Marine submitted a notarized letter from its vice president stating that he had prepared two versions of computer spreadsheet prices for the project. The file name of the original version was "MELONBID.WO1" and the second version, saved as "MELONCF.WO1," subsequently was created upon receipt of a subcontractor's telephone quote. He also stated that he inadvertently printed a copy of the original spreadsheet on bid opening day, and transcribed these prices to the bid schedule. Keet Marine supported the claimed $60,435 error with its receptionist's handwritten notes reflecting subcontractor prices received the day before bid opening; hand-written worksheets primarily reflecting the labor hours and material prices for each line item; and two computer spreadsheets. The spreadsheets listed each line item and contained a separate column for proposed labor hours, labor prices, material prices, subcontractor prices, material and subcontractor prices, and the total cost.

After reviewing the documentation submitted by Keet Marine, the contracting officer concluded that the omission of the subcontractor's price for the subject line items had been clearly established. Once those errors were corrected and the firm's markup of 10 percent was applied to the correct total, the bid became $370,225, still almost 13 percent lower than Fishermen's Boat's bid. Award was made to Keet Marine for that amount.

Fishermen's Boat contends that the Coast Guard improperly permitted Keet Marine to correct its bid price. In this regard, the protester argues that there is no evidence of omitted subcontractor pricing. As a result, Fishermen's Boat claims that Keet Marine's bid should be rejected and award should be made to it.

Mistakes in a bid generally do not render the bid unacceptable if the errors are correctable under the mistake in bid procedures set out in Federal Acquisition Regulation (FAR) Sec. 14.406. F.J. Wash. Constr., Inc., B-246080, Feb. 26, 1992, 92-1 CPD Para. 230. Correction is proper if clear and convincing evidence establishes both the existence of the mistake and the bid actually intended, and the corrected bid does not displace other bidders. FAR Sec. 14.406-3(a).

We treat the question of whether the evidence of the mistake and the bid intended meets the clear and convincing standard as a question of fact, and we will not question an agency's decision in this regard unless it lacks a reasonable basis. Gunco, Inc., B-238910, July 17, 1990, 90-2 CPD Para. 46. Workpapers and computers spreadsheets may constitute clear and convincing evidence if they show the existence of a mistake and the intended bid, are in good order, and are not contradicted by other evidence. Interstate Constr. Inc., B-248355, Aug. 6, 1992, 92-2 CPD Para. 86.

Here, as noted above, Keet Marine submitted several documents prepared before bid opening to support its correction request, specifically, the handwritten record of subcontractor quotes; handwritten worksheets; and two computer spreadsheets. In addition, the agency noted that the awardee's corrected prices for the line items in issue were much closer to the government estimate and other bidders' prices for those line items than the uncorrected figures. For example, for line item D-32, the awardee's uncorrected price was $13,820; the government estimate was $30,000; and the other bidders' prices ranged from $38,857 to $40,897.

The protester challenges the agency's conclusion that the documents submitted by Keet Marine constitute clear and convincing evidence of a mistake in its bid and its intended price. According to the protester, the computer spreadsheets supplied by Keet Marine do not support Keet Marine's statement that it omitted subcontractor costs when it submitted its bid prices for line items D-15, D-16, D-18, D-25, D-29, and D-32. In this regard, the protester claims that since the original spreadsheet does include subcontractor costs for other line items, there is no clear and convincing evidence that Keet Marine intended to include in its bid price subcontractor costs in the six line items at issue.

Contrary to the protester's suggestion, the fact that Keet Marine's original spreadsheet included subcontractor costs for some line items does not establish that Keet Marine did not intend to include subcontractor costs for the items claimed. The solicitation, while generally calling for dockside repairs, set out specific and separate tasks to accomplish the work. The agency states, and the protester does not refute, that the line items for which Keet Marine omitted subcontractor costs specifically called for floor covering work, and that the subcontractor quotes submitted by Keet Marine to support its correction request are for floor covering work. Thus, the fact that the awardee included subcontractor costs for other unrelated work requirements has no bearing on whether the claimed subcontractor costs for the work items at issue were omitted.

Similarly, we are not persuaded by the protester's argument that Keet Marine's handwritten worksheets do not support its claim that it omitted some subcontractor costs. The protester cites, for example, the worksheet for line item D-15, which lists the notation "523 hours $1,750." Based on notations of this type--i.e., hours and a dollar amount--for each line item on the worksheets (with the exception of line item D-29, which is blank), the protester claims that there is no indication in the worksheets that Keet Marine intended to hire a subcontractor to accomplish the line items requiring floor covering work.

We disagree. Comparison of the figures on the worksheets with the figures on the computer spreadsheets shows that the dollar figure listed for line item D-15 and most of the other line items represented the estimated cost of materials associated with that line item. While the documents do not expressly indicate how the labor hours notations on the handwritten worksheets were carried over in the calculations on the spreadsheets, it is clear that for the line items at issue, they were not calculated or included as subcontractor costs in the bid. Thus, we do not think that Keet Marine's handwritten worksheets detract from its claim that certain subcontractor costs were omitted from its bid.

Finally, the protester notes that for two of the six line items at issue- -D-29 and D-32--the original computer spreadsheet contains entries ($4,000 and $5,000, respectively) in the subcontractor costs column. The protester thus argues that Keet Marine cannot claim to have omitted subcontractor costs for those line items.

As noted above, the awardee submitted contemporaneous documents to demonstrate that it intended to include subcontractor costs as reflected in the handwritten record of the subcontractor quotes prepared by the awardee's receptionist; for line items D-29 and D-32, those quotes were $10,382 and $37,207. This is confirmed by the awardee's revised spreadsheet, prepared before bid opening, which lists the corrected figures for the subcontractor costs for both line items. This spreadsheet also shows that in the original spreadsheet the awardee mistakenly inserted the two figures cited by the protester--$4,000 and $5,000--in the wrong column, listing them as subcontractor costs when in fact they are materials costs. Given the other documentation submitted by Keet Marine supporting its claimed mistake, this placement error is not sufficient to disturb the agency's judgment that, on balance, there is clear and convincing evidence of a mistake and of Keet Marine's intended bid.[1]

In sum, in light of the contemporaneous documentation submitted by the awardee; the awardee's plausible explanation of how the mistake occurred; and the fact that the corrected prices are considerably closer to the government estimate and the other bidders' prices for the line items involved than are the uncorrected prices, we think that it was rea- sonable for the agency to allow Keet Marine to correct its bid.

The protest is denied.

1. While not addressed by the agency in its report on the protest, the agency apparently is satisfied that the $4,000 and $5,000 amounts represent materials costs that the awardee intended to include in its bid in addition to the subcontractor costs. Even if inclusion of this $9,000 were disallowed, however, it would have no effect on the bidders' standing since it actually would reduce Keet Marine's bid price.