BNUMBER:  B-261493
DATE:  October 5, 1995
TITLE:  Alpha Construction & Engineering, Inc.

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Matter of:Alpha Construction & Engineering, Inc.

File:     B-261493

Date:   October 5, 1995       

Traeger Machetanz, Esq., Oles, Morrison & Rinker, for the protester.
Bruce Palmer for Palmerco Construction, Inc., an interested party.
Bryant S. Banes, Esq., Department of the Army, for the agency.
Paula A. Williams, Esq., John Van Schaik, Esq., and Michael R. Golden, 
Esq., Office of the General Counsel, GAO, participated in the 
preparation of the decision.

DIGEST

Agency properly allowed correction of mistake in apparent low bid 
where the record clearly shows the existence of the mistake and the 
intended bid.

DECISION

Alpha Construction & Engineering, Inc. protests the proposed award of 
a contract to Palmerco Construction, Inc., under invitation for bids 
(IFB) No. DAHC76-95-B-0010, issued by the Department of the Army, to 
renovate latrines in eight barracks at Fort Richardson, Alaska.  Alpha 
contends that the Army improperly permitted Palmerco to correct a 
mistake in its apparent low bid. 

We deny the protest.

The solicitation's amended bid schedule consisted of six base line 
items (1 through 6) and two option line items (7 and 8).  The line 
items correspond to buildings 632, 622, 624, 626, 628, 630, 620, and 
640, respectively; each building has three latrines except building 
640 (line item 8) which has six.  The bidding schedule required 
bidders to enter prices for the basic line items, 1 through 6, a 
subtotal for the basic bid, and the total bid for line items 1 through 
8.  The solicitation stated that option prices would be included in 
the total evaluated price unless it would not be in the government's 
best interest.

Eleven bids were opened on May 10 at 3 p.m., the date and time set for 
opening.  Palmerco submitted the apparent low bid and Alpha submitted 
the next-low bid.  The amounts bid by the two firms, and the 
government estimate, were as follows:

       Base Bid:        Alpha         Palmerco     Gov't Estimate

     Line Item 1     $   288,000      $   289,000      $   350,000

     Line Item 2     $   288,000      $   289,000      $   350,000

     Line Item 3     $   288,000      $   289,000      $   350,000

     Line Item 4     $   288,000      $   289,000      $   350,000

     Line Item 5     $   288,000      $   289,000      $   350,000

     Line Item 6     $   288,000      $   289,000      $   350,000

      Total 1-6      $1,728,000       $1,734,000      $2,100,000

       Options:                                 

     Line Item 7     $   288,000      $   268,000      $   350,000

     Line Item 8     $   719,000      $   302,000      $   840,000

      Total 1-8      $2,735,000       $2,299,000      $3,290,000
In a May 12, 1995, letter to the agency, Palmerco advised that it had 
mistakenly omitted costs of $302,000 for a portion of the work under 
line item 8, and requested that it be permitted to correct its bid 
upward.  In a sworn statement, the president of Palmerco explained 
that the mistake resulted from Palmerco's use of a computer "recap" 
spreadsheet.  Specifically, he developed a formula in the spreadsheet 
program which multiplied the unit cost per latrine by the number of 
latrines in each building, and then added an amount for overhead and 
profit to each line item in the base bid (line items 1 through 6).  He 
then developed a second spreadsheet formula for line item 8; in this 
formula, he incorrectly used a multiplier of three times the unit cost 
per latrine instead of six, the actual number of latrines in that 
building; this resulted in a bid half of what was intended for that 
line item.[1]  Palmerco's president then manually rounded the number 
on the spreadsheet for each line item and entered the rounded totals 
in the firm's bid.  Palmerco submitted this computer "recap" 
spreadsheet, its cost estimate, workpapers, and a sworn statement from 
the estimator who developed the cost per latrine to demonstrate that 
Palmerco was aware that building 640 had six latrines and that its 
labor and material costs for this building actually were based on a 
quantity of six latrines.

The contracting officer concluded that there was adequate evidence of 
a mistake in Palmerco's, bid, but requested that the firm submit 
further evidence of the bid intended.  In response, on May 17, 
Palmerco submitted all its original documents, including the computer 
disk from which the "recap" spreadsheet was developed, the 
solicitation drawings with the estimator's original annotations, and 
original supplier and subcontractor quotations.   The contracting 
officer confirmed that the computer files retained a pre-bid date and 
time of "5/10/95 at 2:27:34PM," which was consistent with the sworn 
statements, and that the written quotes from Palmerco's suppliers and 
subcontractors similarly showed pre-bid opening dates and times and 
were based on the correct total quantity of 27 latrines.  The 
contracting officer determined that Palmerco had provided clear and 
convincing evidence of the mistake and intended bid and recommended 
that correction be allowed.  The head of the contracting activity 
affirmed the contracting officer's determination to allow correction, 
and the agency intends to award the contract to Palmerco at the 
corrected bid price.  Alpha filed an agency-level protest, which was 
denied.  This protest followed.

Alpha maintains that the Army improperly permitted the upward 
correction, arguing that Palmerco has not demonstrated that it was 
aware, prior to bid opening, that building 640 contained six latrines 
and, thus, that it mistakenly based its line item 8 price on only 
three latrines.  While the protester concedes that Palmerco's 
workpapers show that its estimator considered all latrines in 
estimating the per unit cost for building 640, the protester maintains 
that these workpapers are unrelated to Palmerco's alleged mistake.  In 
this regard, Alpha notes that the estimator's affidavit states that 
his responsibility was to "prepare the cost per unit," and argues that 
there is no evidence the estimator informed Palmerco's president, the 
individual responsible for preparing the bid, that building 640 had 
six latrines instead of three.   Alpha concludes that correction 
should not have been allowed, since a bidder is not permitted to 
recalculate and change its bid to include factors which it did not 
have in mind when its bid was submitted.  See Amtech Elevator Servs., 
B-216067, Jan. 11, 1985, 85-1 CPD  31; Central Builders, Inc., 
B-229744, Feb. 25, 1988, 88-1 CPD  195. 
An agency may allow upward correction of a low bid before award if 
there is clear and convincing evidence establishing both the existence 
of the mistake and the intended bid.  Federal Acquisition Regulation  
14.406.3.  Since the procuring agency has the authority to correct 
such mistakes, and because the weight to be given to the evidence in 
support of an asserted mistake is a question of fact, we will not 
disturb an agency's judgment unless there is no reasonable basis for 
it.  J.L. Malone & Assocs., Inc.; Helix Elec., Inc., B-261353; 
B-261353.2, Sept. 18, 1995, 95-2 CPD      ; M.A. Mortenson Co., 
B-254152, Nov. 19, 1993, 93-2 CPD  296.  For an upward correction of 
a bid, workpapers, including records of computer generated software 
spreadsheets and worksheets, 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.  C 
Constr. Co., Inc., B-253198.2, Sept. 30, 1993, 93-2 CPD  198.  

We find no basis to question the Army's decision to allow correction.

The protester argues that there is no evidence to show that Palmerco's 
president was aware, prior to bid opening, that building 640 contained 
six latrines, and therefore no basis to believe that Palmerco intended 
to bid on the six latrines.  However, we think the evidence in the 
record supports the Army's conclusion about Palmerco's intended bid.  
Palmerco's bid was signed by its president, who also prepared its 
lump-sum bid prices; as the signer of the bid, he is presumed to know 
and is responsible for knowing, the contents of the solicitation, 
which called for the renovation of six latrines in building 640.  In 
this regard, the president states that he not only reviewed the 
solicitation drawings, but also supplier and subcontractor quotes 
prior to giving these documents to the estimator.  Moreover, his 
estimator, on whom he relied to develop the unit cost per latrine, was 
well aware that the actual number of latrines for line item 8 was six.  
This is evidenced by the estimator's workpapers and worksheets which 
show supplier and subcontractor quotations based on six latrines in 
building 640, and otherwise show the estimator's own calculations 
based on these quotes.  The estimator's affidavit states that he and 
the president repeatedly discussed scheduling problems and the extra 
costs associated with renovating the six latrines at issue.  The 
president of Palmerco explains, in an affidavit submitted in response 
to the protester's allegations, that he, the estimator and a 
subcontractor went on a pre-bid site visit and together they inspected 
each of the eight buildings.  He specifically recalls discussing with 
his subcontractors that building 640 contained six latrines.  Under 
these circumstances, we find that Palmerco's president was aware of 
the solicitation requirements for building 640, and we conclude that 
the agency reasonably found Palmerco had submitted clear and 
convincing evidence of the mistake and of its intended bid, and 
properly permitted the $302,000 upward correction.

The protest is denied.

Comptroller General
of the United States

1. The protester did not add overhead or profit to line items 7 or 8.