BNUMBER: B-275019
DATE: January 16, 1997
TITLE: Williams Electric Company, Inc.
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Matter of:Williams Electric Company, Inc.
File: B-275019
Date:January 16, 1997
Raymond Fioravanti, Esq., Epstein Becker & Green, P.C., for the
protester.
Maj. Marvin Gibbs, and Gary M. Parker, Esq., Department of the Army,
for the agency.
Mary G. Curcio, Esq., David A. Ashen, Esq., and John M. Melody, Esq.,
Office of the General Counsel, GAO, participated in the preparation of
the decision.
DIGEST
Protest that agency improperly rejected bid as unbalanced is denied
where bidder's explanation of why certain costs were properly included
under line items, the price for which the agency considered to be
enhanced, rather than under other line items the price for which the
agency considered to be understated, is based on an unreasonable
interpretation of the solicitation.
DECISION
Williams Electric Company protests the rejection of its bid as
unbalanced and the consequent award of a contract to North Landing
Line Company under invitation for bids (IFB) No. DABT57-96-B-0090,
issued by the Department of the Army for electrical work involving the
replacement of crossarms, poles, and transformers at Fort Eustis,
Virginia.
We deny the protest.
The solicitation schedule required bidders to provide a lump-sum price
for each of four line items: CLIN 0001/Base Bid, for "Replacement of
crossarms Feeder 'B'"; CLIN 0002/Optional Bid Item 0001, for
"Replacement of poles, 85, 86, 87, and 88"; CLIN 0003/Optional Bid
Item 0002, for "Replacement of poles 8-24, 8-25, and 8-28A";[1] and
CLIN 0004/Optional Bid Item 0003, to "Replace pad mounted
transformers, and 15 KV [kilovolt] oil switches, 800 block." The
solicitation provided that the award would be based on the total
aggregate amount of the bid for the base and option items, but that
any award was subject to the availability of funding. The Army
rejected Williams's apparent low bid as unbalanced and made award to
North on September 30, 1996 for CLIN 0001/Base Bid.
A bid that is based on nominal prices for some work and enhanced
prices for other work is mathematically unbalanced. A mathematically
unbalanced bid cannot be accepted if it is also materially unbalanced,
that is, if there is a reasonable doubt that an award based on the bid
will result in the lowest cost to the government. Sawadi Corp.,
B-265740; B-265741, Dec. 21, 1995, 95-2 CPD para. 279.
The bids of Williams and North, and the independent government cost
estimate (IGCE), were as follows:
CLIN Williams North IGCE
0001 $491,000 $ 99,400 $190,154
0002 $ 6,500 $173,000 $207,479
0003 $ 6,500 $173,000 $217,853
0004 $303,000 $410,500 $369,310
Total $807,000 $855,900 $984,796
The Army found Williams's bid mathematically unbalanced because it was
overstated for CLIN 0001 and understated for CLINs 0002 and 0003. In
this regard, the Army reports that Williams's prices for CLINs 0002
and 0003 were not sufficient even to cover the material costs for
those items, as shown on drawings E-12, E-13 and E-14, which,
according to the Army, detail the work for CLINs 0002 and 0003. The
Army also found Williams's bid materially unbalanced because it was
unsure if it would exercise any of the options, and Williams's bid was
low only if all three options were awarded.
Williams does not dispute that its proposed price for CLIN 0001 was
overstated and its price for CLINs 0002 and 0003 understated if, as
the Army contends, drawings E-12, E-13, and E-14 described work that
should be included under CLINs 0002 and 0003. Williams argues,
however, that the work shown on these drawings was work that was
required to be included under CLIN 0001. Consequently, argues
Williams, its bid was improperly rejected.
Where a dispute exists as to the actual meaning of a solicitation
requirement, our Office will resolve the matter by reading the
solicitation as a whole and in a manner that gives effect to all
provisions of the solicitation. Mobile Medic Ambulance Serv., Inc.,
B-259045, Feb. 15, 1995, 95-1 CPD para. 92.
The solicitation included a packet of 17 drawings that detailed the
work required by CLINs 0001, 0002, and 0003: Drawing E-1 was an
electrical distribution site plan; Drawings E-2, E-3, and E-4
contained photographs of the individual poles; Drawings E-5 through
E-14 detailed work required by the three CLINs; and Drawings E-15
through E-17 provided general construction details for the three line
items. The electrical distribution site plan (Drawing E-1), which
showed the electrical system in Fort Eustis, had three distinct areas
delineated on it: the Base Bid (CLIN 0001) area, Optional Bid Item
0001 (CLIN 0002) area, and Optional Bid Item 0002 (CLIN 0003) area.
The portion of the plan covering each area showed the poles within the
area that are to be worked on; each pole was followed by two sets of
parentheses, each containing a number which referenced a drawing where
additional information related to the poles could be found. For
example, the Optional Bid Item 0001 area included the entry "85, 86
(E-3) (E-11)," indicating that poles 85 and 86 are part of the work to
be performed under CLIN 0002/Optional Bid Item 0001 and that further
information related to this work could be found on Drawings E-3 and
E-11.
Williams notes that Drawings E-12, E-13, and E-14 were not referenced
in the parentheses following the poles to be worked on as part of
Optional Bid Items 0001 and 0002 (CLINs 0002 and 0003). In addition,
Williams points out that, while the description in the schedule of
CLIN 0001 referred to the replacement of crossarms, the descriptions
in the schedule of CLINs 0002 and 0003 referred only to the
replacement of poles. Williams concludes from this that the work
described on Drawings E-12, E-13, or E-14, which did not include the
replacement of any poles, should not have been included under CLINs
0002 and 0003, but instead was properly included under CLIN 0001.
Williams's interpretation of the drawings is unreasonable. The only
solicitation provisions that detailed the scope of the work to be
performed under each line item were the drawings. While Williams is
correct that Drawings E-12, E-13, and E-14 were not referenced in the
parentheses following the poles to be worked on as part of CLINs 0002
and 0003, neither were the drawings referenced in the parentheses
following the poles included under CLIN 0001. However, it is clear
from a review of Drawings E-12, E-13 and E-14 that they were meant to
detail work relating to CLINs 0002 and 0003; the only poles shown on
these drawings (poles 8-24, 8-25, 8-28, 8-28A, 85, 86, 87, and 88)
were the poles that are included under CLINs 0002 and 0003 in the
schedule and on drawing E-1.
Williams argues that, to the extent that there is any inconsistency
between Drawings E-12, E-13, and E-14 and the descriptions in the
schedule of each line item, the schedule description governed under
the solicitation's Order of Precedence clause, which provided that
"[a]ny inconsistency in this solicitation or contract shall be
resolved by giving precedence in the following order: (a) the
schedule. . . ." According to Williams, therefore, work for other
than the replacement of poles--as shown on Drawings E-12, E-13, and
E-14--was properly included under CLIN 0001 (if not covered by CLIN
0004), even if the drawings suggested otherwise, because only the
schedule description of CLIN 0001 referred to non-pole work (not
associated with CLIN 0004). Williams's position, however, ignores the
fact that the schedule description of CLIN 0001 in fact referred to
work on Feeder B, a transmission line carried on poles other than
those referenced in the schedule descriptions of CLINs 0002 and 0003.
In our view, it was unreasonable to assume that work associated with
poles covered under CLINs 0002 and 0003 was instead to be included
under CLIN 0001, which covered an entirely different set of poles.
Since Williams thus included the cost of work required under CLIN 0002
and 0003 under CLIN 0001, Williams overstated its price for CLIN 0001
and understated its price for CLINs 0002 and 0003. The Army therefore
reasonably found that Williams's bid was mathematically unbalanced.
Williams argues that, even if its bid was mathematically unbalanced,
it should not have been rejected as materially unbalanced because
there was no reasonable doubt that award to Williams will result in
the lowest overall cost to the government. However, the Army reports
that there was considerable doubt at the end of fiscal year 1996
whether any funding would be available for this project, and when
funding was made available on September 29, it was only sufficient for
award of the base item. In addition, according to the agency, even
now there currently is no funding available for the option items and
it currently has no intention of exercising any of the options.
Williams notes that the Army advertised the scope of the project as
between $500,000 and $1,000,000 and requested funding in the amount of
$984,796.07, arguing that this indicates that the options will be
exercised within the 9-month period allowed for exercise. However,
the amount of the funding request and the advertised scope of the
project do not refute the agency's position that at the time of award
there was no funding available for exercise of the options and no
reasonable expectation of receiving such funding in the time allowed
for their exercise. Since Williams's bid would not be low unless all
three options were exercised, the Army did not have funding available
at the time of award to exercise the options, and there was reasonable
doubt as to whether sufficient funding would become available, there
is no basis to question the Army's determination that there was
reasonable doubt that award to Williams would result in the lowest
overall cost to the government. The Army therefore reasonably found
that Williams's bid was materially unbalanced, and properly rejected
the bid.
The protest is denied.
Comptroller General
of the United States
1. Although the schedule description of CLINs 0002 and 0003 referred
to replacement of the specified poles, the drawings showed that the
poles themselves were to remain, and instead various items related to
the poles (such as the crossarms and switches) were to be replaced.