BNUMBER:  B-274634
DATE:  December 19, 1996
TITLE:  Doty Bros. Equipment Company

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Matter of:Doty Bros. Equipment Company

File:     B-274634

Date:December 19, 1996

B. C. Brown for the protester.
Christopher M. Bellomy, Esq., Department of the Navy, for the agency.
Robert Arsenoff, Esq., and Paul I. Lieberman, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Agency improperly rejected low offer for failure to acknowledge a 
solicitation amendment where the agency has not identified how the 
amendment, which eased    performance requirements, reflected a 
minimum need and thus how the amendment was material.

DECISION

Doty Bros. Equipment Company protests the rejection of its low offer 
under request for proposals (RFP) No. N68711-96-R-2220, issued by the 
Department of the Navy for the construction of a replacement jet fuel 
pipeline in Los Angeles County, California.  The protester asserts 
that the contracting officer improperly rejected  Doty Bros.' low 
offer for failing to acknowledge an immaterial solicitation amendment.

We sustain the protest.

The RFP, which was issued on August 8, 1996, and closed on August 20, 
contemplated a contract for a construction project to replace a jet 
fuel pipeline including excavation, construction of a new line and 
removal of the old line, and backfilling the excavated areas.  
Competition was limited to four offerors based on the agency's 
determination that an unusual and compelling urgency required such a 
restriction.  Offerors were to submit a firm, fixed price for the 
project and provide a completed set of standard representations and 
certifications.  The RFP advised that the agency intended to make 
award to the responsible offeror whose conforming offer was most 
advantageous to the government considering price and other factors 
specified in the solicitation without conducting discussions; no 
"other factors" were  specified elsewhere in the solicitation, hence 
the agency awarded on the basis of low price.

On August 15, amendment No. 0001 was issued which modified the 
specification with respect to backfilling the excavation; the closing 
date was not extended by the amendment and the changes set forth in 
the amendment were described as "technical."

Three offers were received as follows:

     Doty Bros.               $778,019
     ARB, Inc.                $998,395
     Offeror A                $1,283,084

Doty Bros. was the only offeror that failed to acknowledge receipt of 
Amendment No. 0001 and, accordingly, on August 28, the agency wrote to 
the firm as follows, rejecting its offer and advising it of the award 
to ARB[1]:

             "This is to advise you that your offer does not conform 
to the
             subject solicitation due to a failure to [a]cknowledge 
Amendment
             0001 which has a significant impact on the work to be
             performed."

Upon receipt of the letter, Doty Bros. contacted the agency on 
September 11 and asserted that its failure to acknowledge amendment 
No. 0001 should have been viewed as a minor informality or 
irregularity, suggesting that the agency should have called for 
clarification.  According to Doty Bros., the agency representative 
explained that, given the contracting office's work load, there was 
often not time to make confirming telephone calls and, further, that 
the failure to acknowledge the amendment could not be viewed as a 
minor informality which could be waived or cured later without 
entering into discussions with all offerors--something the RFP did not 
contemplate.  This protest to our Office followed on September 13, 
with Doty Bros. reiterating the argument it had presented to the 
agency on  September 11.  In response, the agency has basically 
reiterated the position it communicated to Doty Bros. 2 days before 
the protest was filed. 

Prior to the issuance of the amendment in dispute, the RFP required 
that the excavated pipeline trench be backfilled to grade entirely 
with a mixture of cement, aggregate and water of a specified density 
known as "three-sack" slurry based on the amount of cement necessary 
to make a defined amount of the slurry mixture.[2]  The amendment 
changed the requirement to a less expensive, thinner slurry, known as 
"one-sack"; it further provided for filling the trench with slurry 
only to a depth of 3 feet below grade and completing the backfill to 
the existing grade with the compacted earth available from the 
excavated jobsite.

The agency concedes that the amendment has virtually no effect on the 
price of the project.  Nonetheless, the agency maintains that the 
amendment is material simply because it changes the manner in which 
backfilling is to be accomplished which, in and of itself, according 
to the agency, creates a "significant" impact on the quality of the 
work to be performed.

Doty Bros. maintains that the amendment is not material because it 
basically constitutes a relaxation of the original backfilling 
requirements, permitting the use of a smaller quantity of a thinner, 
less expensive slurry together with available excavated earth (which 
is less expensive than slurry) to top off the backfill.  As a result, 
the protester maintains that its "technical" failure to acknowledge 
the amendment could have been, and should have been, the subject of a 
unilateral clarification falling short of triggering any requirement 
for discussions with all three offerors.  We agree.

For negotiated procurements, FAR  sec.  15.607 requires contracting 
officers to examine proposals for "minor informalities" and 
"irregularities" and specifically cross-references FAR  sec.  14.405 
(applicable to sealed bid procurements) for a definition of the same.  
Further, FAR  sec.  15.607 provides that unilateral communications with an 
offeror to resolve such minor informalities and irregularities are 
"clarifications" and not "discussions" triggering the need to conduct 
discussions with all competitive range offerors.  FAR  sec.  14.405 (as 
read in the context of this negotiated procurement) provides as 
follows:

     "A minor informality or irregularity . . . pertains to some 
     immaterial defect in [an offer] or variation of [an offer] from 
     the exact requirements of the [solicitation] that can be 
     corrected or waived. . . . The defect or variation is immaterial 
     when the effect on . . . quality     . . . is negligible when 
     contrasted with the total . . . scope of supplies or services 
     being acquired.  The contracting officer either shall give the 
     [offeror] an opportunity to cure any deficiency resulting from a       
     minor informality or irregularity in [an offer] or waive the 
     deficiency, whichever is to the advantage of the Government.  
     Examples of minor informalities or irregularities include failure 
     of [an offeror] to . . . [a]cknowledge receipt of an amendment to 
     [a solicitation], but only if  . . . [t]he amendment . . .  has 
     either no effect or merely a negligible effect on . . . quality . 
     . . of the item [offered]."  (Emphasis added.)

As stated above, the agency has asserted that, solely because the 
amendment changes how performance is to occur, it is material and, 
therefore, a failure to acknowledge the amendment cannot legally be 
waived or corrected without holding discussions with all competitive 
range offerors.

There is no precise rule for determining whether a change in 
requirements is more than negligible, Innovation Refrigeration 
Concepts, B-271072, June 12, 1996, 96-1 CPD  para.  277; rather, that 
determination is based on the facts of each case.  Day and Night 
Janitorial and Maid and Other Servs., Inc., B-240881, Jan. 2, 1991, 
91-1 CPD  para.  1.  The mere fact that requirements have been changed by an 
amendment does not render the amendment material and does not, 
therefore, provide a basis for rejecting a bid that does not 
acknowledge the amendment.   See L & R Rail Serv., 
B-256341, June 10, 1994, 94-1 CPD  para.  356 (protest sustained where 
agency did not provide support for its assertion that a change in 
requirements was material); Titan Mountain States Constr. Corp., 
B-183680, June 27, 1975, 75-1 CPD  para.  393.  In other words, in cases 
where price is not meaningfully affected by an amendment, for the 
amendment to be material something about the change must reflect a 
legitimate minimum need of the agency such that its requirements will 
not be met if the contractor performs to the unamended specifications.  
In such circumstances, where neither the text of an amendment nor the 
agency's explanation of the need for an amendment indicates what 
factors inherent in the changed method of performance are necessary or 
significant to meet the needs of the agency, the amendment cannot be 
viewed as material.  Day and Night Janitorial and Maid and Other 
Servs., Inc., supra.

Here, there is nothing in the record indicating what minimum need of 
the agency is reflected in the unacknowledged amendment.  Neither the 
text of the amendment nor the agency's bare assertion that the changed 
method of performance significantly impacts quality addresses 
why--aesthetically, structurally or otherwise--the use of less strong 
and cheaper backfilling materials in lieu of those originally 
specified in the solicitation is required to meet a legitimate minimum 
need of the agency.  That being so, we must conclude that the 
amendment was not material and that the contracting officer therefore 
was obligated to either waive Doty Bros.' failure to acknowledge the 
amendment or permit the firm an opportunity to cure it.  FAR  sec.  15.607.  
Since the contracting officer instead rejected the offer, we sustain 
the protest.

Because the protest was not filed within 10 days after award, no 
statutory stay was in effect and performance has continued to date.  
In response to our inquiry, the agency reports that approximately 40 
percent of the project is complete including excavation and 
installation of the new pipeline, with removal of the old pipeline and 
restoration to grade remaining to be performed.  Under these 
circumstances it is impractical to recommend contract termination; we 
do, however, recommend that Doty Bros. be reimbursed for its proposal 
preparation costs and its reasonable costs of filing and pursuing this 
protest.  Bid Protest Regulations, section 21.8(d)(1) and (2), 61 Fed. 
Reg. 39039, 39046 (1996) (to be codified at 4 C.F.R.  sec.  21.8(d)(1) and 
(2)).  The protester should submit its certified claim for costs to 
the contracting agency within 60 days of receiving this decision.  
Section 21.8(f)(1), 61 Fed. Reg. supra (to be codified at 4 C.F.R.  sec.  
21.8(f)(1)).

The protest is sustained.

Comptroller General
of the United States

1. The agency also states that it rejected Doty Bros.' offer for 
failure to submit a completed set of standard representations and 
certifications.  The protester states that it submitted a set to the 
agency with the rest of its offer.  Assuming that the offer package 
which the agency received did not contain the representations and 
certifications, the agency's position that it could not have permitted 
Doty Bros. to correct this deficiency without being required to 
conduct discussions with all offerors is without merit.  We have 
recognized that, even under sealed bid procurements, the failure of a 
bidder to complete standard representations and certifications is a 
minor irregularity which does not render its bid nonresponsive and the 
requisite information may be furnished after bid opening.  Jettison 
Contractors, Inc., B-242792, June 5, 1991, 91-1 CPD  para.  532.  It follows 
then that correction of any failure by Doty Bros. to supply the 
representations and certifications with its offer would not trigger a 
requirement to conduct discussions with all offerors.  (Federal 
Acquisition Regulation (FAR)  sec.  15.607(a) (FAC 90-31) provides that 
communications with offerors to correct minor irregularities are 
clarifications, not discussions, within the meaning of FAR  sec.  15.610.)  
While the set of missing representations and certifications here also 
includes a certificate of procurement integrity, that certificate may 
be obtained at any time prior to award without triggering the 
requirement to hold discussions with all offerors.  Worldwide Servs., 
Inc./Perry Management Corp., a Joint Venture, B-261113, Aug. 18, 1995, 
95-2 CPD  para.  73.

2. Some cuts could be filled with earth and compacted by rolling or 
tamping to a given degree of compaction as spelled out in the 
specification.