TITLE:  Reliable Mechanical, Inc., B-282874.2, September 13, 1999
BNUMBER:  B-282874.2
DATE:  September 13, 1999
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Reliable Mechanical, Inc., B-282874.2, September 13, 1999

Decision

Matter of: Reliable Mechanical, Inc.

File: B-282874.2

Date: September 13, 1999

Charles F. Merz, Esq., Charles F. Merz & Associates, for the protester.

Lawrence J. Sklute, Esq., Sklute & Associates for Cooper Construction, Inc.,

an intervenor.

Maria S. Kavouras, Esq., Environmental Protection Agency, for the agency.

Charles W. Morrow, Esq., and James A. Spangenberg, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Agency's decision to permit upward correction of the apparent low bid is
reasonable where the low bidder's worksheets reasonably established clear
and convincing evidence of the mistake and the bid intended, and the
protester's contentions are premised on apparent differences between the
methodology by which it calculated its bid and how the awardee prepared its
bid.

DECISION

Reliable Mechanical, Inc. protests the award of a contract to Cooper
Construction, Inc. under invitation for bids (IFB) No. PR-CI-99-13375,
issued by the United States Environmental Protection Agency (EPA), for
construction work. Reliable contends that EPA improperly permitted Cooper to
correct a mistake in its bid.

We deny the protest.

The IFB covered interior Phase II renovations at selected laboratories,
toilet rooms, stairways, and related mechanical, electrical, plumbing and
fire protection systems and for new main electrical panel boards and
asbestos abatement at the EPA National Exposure Research Laboratory, Athens,
Georgia. Agency Report, Tab D-1, Part 1. The IFB schedule delineated the
work under, and requested separate fixed prices for, five line items
entitled Base Bid Phase II, Add Option 1, Add Option 2, Add Option 3, and
Add Option 4. RFP sect. B, at B.1. The base bid item called for renovation and
construction at Lab Nos. 253, 254, 255, 256, 257, and 258, including, but
not limited to related mechanical, electrical, plumbing, and fire
protection; Add Option 1 required new construction and renovations at Lab
Nos. 259, 260, and 261; Add Option 2 called for new construction and
renovations at Lab Nos. 250 and 251; Add Option 3 was for stair renovations;
and Add Option 4 was for restroom renovations. Contracting Officer's
Statement at 2.

Four bids were received by bid opening. Cooper submitted the apparent low
bid at $2,313,000, which was comprised of a base bid of $1,247,000 and
option prices of $391,000, $217,000, $62,000, and $396,000, respectively.
Reliable was next low with a bid of $2,718,000, which was comprised of a
base bid of $1,995,000, and option prices of $297,000, $183,000, $61,000,
and $182,000. The remaining bids were $2,789,400 and $2,802,615. Id. Because
Cooper's base bid was significantly lower than the other bids and its Add
Option 4 bid was significantly higher than the other bids, EPA requested
Cooper to verify its bid.

Cooper responded by acknowledging a mistake in bid, requesting an upward
adjustment of $217,000, and furnishing EPA supporting documentation of the
claimed mistake, which included copies of its original handwritten bid
worksheets and an affidavit from the preparer explaining the nature of the
mistake. Agency Report, Tab I. Cooper explained that it developed separate
worksheets to correspond with each of the line items, which it stored in
five separate folders, labeled consistent with the line items. In the folder
created for Add Option 4 (entitled ALT.4 – Bathroom), Cooper
mistakenly included page 4 of the worksheet for the base bid, which showed a
total $396,000 for the base bid electrical work with supporting
calculations, along with the worksheet for Add Option 4, which showed a
total $217,000 with supporting calculations. Because page 4 of the base bid
worksheets was placed over the intended worksheet for Add Option 4 in the
folder, Cooper mistakenly bid $396,000 for Add Option 4, instead of
including this amount in its base bid, and failed to bid $217,000 for Add
Option 4. After reviewing Cooper's request, including the documentation in
support, the EPA approved Cooper's request for correction, and made award at
the revised amount to that firm. This protest followed.

An agency may permit correction of a bid where clear and convincing evidence
establishes both the existence of a mistake and the bid actually intended.
Federal Acquisition Regulation (FAR) sect. 14.407-3(a); Holmes Mechanical, Inc.,
B-281417, Jan. 13, 1999, 99-1 CPD para. 6 at 2. Work papers, including
handwritten worksheets, may constitute clear and convincing evidence if they
are in good order and indicate the intended bid price, and there is no
contravening evidence. Whether the evidence meets the clear and convincing
standard is a question of fact and we will not question an agency's decision
based on this evidence unless it lacks a reasonable basis. Holmes
Mechanical, Inc., supra, at 2-3.

In challenging the claimed mistake, Reliable does not directly attack the
worksheets, which our review indicates are in good order and support the bid
correction, or Cooper's explanation as to how the mistake occurred. Instead,
Reliable primarily argues that Cooper did not make the mistake claimed, but
is attempting to recover other costs omitted from its bid associated with
the direct digital control work under the contract. In this regard, Reliable
asserts that the IFB required a particular manufacturer's direct digital
control components and that Cooper could not have obtained a quote from this
manufacturer at the time it submitted its bid because the manufacturer did
not quote prices to vendors until the day of bid opening. Reliable contends
that Cooper's worksheets indicated a substantial underbid for this
manufacturer's equipment, as indicated by the quote Reliable obtained from
the manufacturer. In addition, Reliable argues that the $396,000 on the
worksheet that is attributed to the base bid electrical work is in excess of
the reasonable costs of this aspect of the work. Therefore, Reliable
questions the reliability and validity of Cooper's claimed mistake.

In reviewing whether an agency acted properly in permitting the upward
correction of a bid, it is not appropriate to question the precise
methodology by which a bidder undertakes to calculate its bid, even where
items seemingly are excessively or under priced. Id. at 3; PK Contractors,
Inc., B-205482, Apr. 22, 1982, 82-1 CPD para. 368 at 4. Our concern is whether
the worksheets provide a reasonable basis for the agency's conclusion that
there was clear and convincing evidence of the mistake and the intended bid.
Holmes Mechanical, Inc., supra, at 3.

Our review shows that Reliable's contentions are premised on apparent
differences between the methodology by which it calculated its bid as
opposed to how Cooper calculated its bid, as well as on an apparent
misinterpretation of the IFB specifications. In this regard, EPA reports
(and our review confirms) that the IFB does not require the direct digital
control components to be supplied by a particular manufacturer. Agency
Supplement Report at 4-5. Also, Cooper explains that the costs that Reliable
believed to be the total direct digital control costs reflected in Cooper's
worksheets did not include certain installation and electrical work, which
were included in Cooper's cost for the electrical work of the base bid. Id.,
attach. 2, at 4-5. Reliable has not refuted the agency's and Cooper's
explanations, which we find reasonable. Therefore, there is no basis on this
record to challenge the bid correction.

The protest is denied.

Comptroller General

of the United States