BNUMBER:  B-278725 
DATE:  March 6, 1998
TITLE: Mobile Dredging & Pumping Company, B-278725, March 6, 1998
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Matter of:Mobile Dredging & Pumping Company

File:     B-278725

Date:March 6, 1998

Donald J. Walsh, Esq., Scaldara & Potler, for the protester.
George M. Kingsley, Esq., and Joseph J. Cox, Esq., U. S. Army Corps of 
Engineers, for the agency.
Sylvia Schatz, Esq., David A. Ashen, Esq., and John M. Melody, Esq., 
Office of the General Counsel, GAO, participated in the preparation of 
the decision.

DIGEST

Agency had a compelling reason to cancel solicitation after bid 
opening where requirement in solicitation did not meet its actual 
needs.

DECISION

Mobile Dredging & Pumping Company, Inc. protests the U.S. Army Corps 
of Engineers' cancellation of invitation for bids (IFB) No. 
DACW31-97-B-0061, for dredging of the Dalecarlia Reservoir at the 
Washington Aqueduct in the District of Columbia.

We deny the protest.

The Washington Aqueduct provides drinking water to the District of 
Columbia and parts of Virginia, utilizing the Dalecarlia Reservoir as 
one of its settling areas prior to water treatment.  The solicitation 
required dredging the reservoir of sediment and pumping the sediment 
through a pipe to dewatering equipment, where the sediments or solids 
will be separated from the water; the sediment then is to be 
discharged onto a concrete pad and hauled away, while the leftover 
water will be discharged to a dewatering discharge pond and then 
returned to the reservoir.  The specifications permitted the 
contractor to use a polymer to bond with the sediments so that they 
may be separated and removed from the water.  However, the 
specifications imposed certain restrictions on the use of polymers 
because, while most of the polymer is discharged with the dewatered 
solids onto the concrete pad, some polymer remains in the filtrate 
water--i.e., water that has been discharged from the dewatering 
equipment.  

Specifically regarding polymers, section 02482 of the specification, 
entitled "Dredging, Dewatering, and Sediment Disposal," stated, in 
relevant part, as follows:

     7.6  Dewatering operations shall be accomplished through a number 
     of portable mechanical dewatering units.  The portable dewatering 
     equipment shall be either centrifuges, plate and frame filter 
     presses or twin belt filter presses.  Prior to entering the 
     dewatering equipment, the dredged material may be mixed with a 
     polymer, provided that the polymer is suitable for use with 
     potable water.  The Contractor shall submit to the Government, 
     for approval, the polymer he will be using.  The polymer shall be 
     acceptable for use in potable water and be approved by the 
     National Sanitation Foundation (NSF).  Submittal shall have 
     complete information, characteristics about the product and 
     mixing proportions.

Five bids were received and opened.  Mobile submitted the apparent low 
bid of $3,428,950, and Sevenson Environmental Services, Inc. the 
apparent second low bid of $3,468,060.  

Subsequently, following an agency-level protest filed by Sevenson and 
several exchanges with Mobile, the Corps realized that Mobile's 
interpretation of paragraph 7.6 was inconsistent with the Corps's 
intent.  The record indicates that the Washington Aqueduct, the 
drafter of the specification, intended paragraph 7.6 to impose NSF 
Standard 60--a drinking water standard--as a limit on the amount of 
polymer permitted to be added to the dredged sediment prior to 
dewatering.  It was Mobile's position, on the other hand, that the IFB 
could not be read this way because (1) the NSF standard was not set 
forth as a requirement, and (2) even if it were referenced, it is a 
drinking water (i.e., post-dewatering) standard, and cannot be read as 
limiting the amount of polymer added to remove sludge at the beginning 
of the dewatering process.

Subsequently, the Corps (along with the Washington Aqueduct) 
determined that paragraph 7.6 was defective because it did not clearly 
state the agency's needs.  Specifically, (1) as Mobile had asserted, 
the IFB did not reference the NSF standard for drinking water; (2) in 
any case, imposing the NSF standard as a limit on the polymer added 
(rather than to the amount remaining after dewatering) would be 
excessively strict (since the amount of polymer added before the 
dewatering process does not equate directly to the amount of polymer 
remaining in the treated water emitted from the dewatering equipment); 
and (3) it did not contain an effective means of ensuring that treated 
water would contain acceptable levels of polymers.  The Corps 
therefore canceled the IFB with the intention of resoliciting using an 
amended paragraph 7.6.
 
Mobile argues that, contrary to the agency's determination, paragraph 
7.6 was unambiguous in stating the agency's needs, and that the 
cancellation therefore was improper.

An agency generally may cancel an IFB after bid opening and exposure 
of prices only where there is a compelling reason to do so.  Federal 
Acquisition Regulation  sec.  14.404-1(a)(1); City Wide Press, Inc., 
B-231469, Aug. 10, 1988, 88-2 CPD  para.  127 at 2.  Whether cancellation is 
warranted is a decision for the contracting agency, whose 
determination we will not disturb unless it is shown to be 
unreasonable.  City Wide Press, Inc., supra, at 2-3.  We generally 
consider cancellation after bid opening to be appropriate when an 
award under the solicitation would not serve the government's actual 
needs.  Berendse & Sons Paint Co., B-262244, Nov. 21, 1995, 95-2 CPD  para.  
235 at 3.

Mobile's challenge to the cancellation is based on its view that the 
IFB as written clearly did not limit the amount of polymers the 
contractor would be allowed to add.  This argument ignores the 
agency's position that the NSF standard for polymers in drinking water 
must be imposed on the contractor, and that the IFB as 
written--whether or not ambiguous--does not ensure that water emitted 
from the dewatering equipment will meet that standard.  The record 
supports the Corps's position.  First, the Corps has determined that, 
given that water from the dewatering process will be returned to a 
reservoir used to produce drinking water, the NSF Standard 60 maximum 
use limits for polymers must apply to the water emitted from the 
dewatering equipment.  We agree with Mobile's original position that 
since the IFB did not reference the NSF standard, there was no basis 
for reading the IFB as including it.  

More importantly, since the agency now agrees with the protester that 
it is not appropriate to apply the NSF standard to the amount of 
polymer added to the dredged sludge (the approach on which the Corps 
claims the IFB was based), the original IFB contains no effective 
means of confirming that a particular standard has been met.  In this 
regard, although specification paragraph 7.6.7 provided for testing 
filtrate water for solid content, the Corps has determined (and the 
protester does not rebut the agency's position) that testing for 
polymer in the filtrate water discharged into the reservoir would be 
difficult at best, since there is no known standard test for 
identifying the level of a particular polymer in the filtrate water 
and the nature of any such test, even if feasible, would make it 
exorbitantly costly to conduct.  More fundamentally, the agency notes 
the impracticality of testing for polymer at the end of the dewatering 
process--after the contractor has set up its equipment and committed 
to a particular method and mixture, which may or may not result in 
acceptable polymer levels in the water discharged into the reservoir.

To ensure compliance with NSF Standard 60, the Corps reports that it 
intends to amend paragraph 7.6 to impose the following requirements on 
the contractor:      (1) explicitly require that the contractor's 
proposed NSF-approved polymer meet the NSF standard maximum use level 
in the filtrate water; (2) require the contractor to submit to the 
government for approval the polymer it intends to use, including 
complete technical data, material characteristics, a material safety 
data sheet, mixing proportions, and calculations verifying that the 
polymer concentration that enters the reservoir from the dewatering 
equipment for a peak production day will not exceed the NSF maximum 
use level based on a specified reservoir flow rate (150 million 
gallons per day); and (3) require the contractor to furnish the 
government with a record of the amount of polymer used each day and 
the total amount of filtrate water recycled into the reservoir.  

We conclude that the IFB did not set forth the agency's actual needs, 
and that the cancellation therefore was proper.

The protest is denied.
     
Comptroller General
of the United States