TITLE:  Paragon Van Lines, Inc., B-291820.2; B-291913, April 8, 2003
BNUMBER:  B-291820.2; B-291913
DATE:  April 8, 2003
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Paragon Van Lines, Inc., B-291820.2; B-291913, April 8, 2003

   Decision
    
    
Matter of:   Paragon Van Lines, Inc.
    
File:            B-291820.2; B-291913
    
Date:              April 8, 2003
    
Michael D. Cocozza for the protester.
Maj. Art J. Coulter, Department of the Army, for the agency.
Guy R. Pietrovito, Esq., and James A. Spangenberg, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
    
Agency had compelling reason to cancel an invitation for bids containing
inconsistent provisions regarding the performance period and outdated
Service Contract Act wage determinations.
DECISION
    
Paragon Van Lines, Inc. protests the cancellation after bid opening of
invitation for bids (IFB) No. DAKF29-02-B-0001 and the issuance of request
for quotations (RFQ) No. DABJ15-03-T-0074 by the Department of the Army
for inbound and outbound transportation of household goods.
    
We deny the protests.
    
The IFB, issued January 17, 2002, provided for multiple awards of
requirements contracts for packing, crating, moving and storage of
household goods.  The IFB bid schedule stated that the services were to be
performed *during the period 1 February 2002, or date of subsequent award
if subsequent thereto, through 31 January 2003.*  IFB S: B, Bid Schedule,
at 3.  The IFB also stated that the *period of performance for any
contract awarded shall be twelve (12) months from effective date,*  IFB S:
F, Period of Contract Clause, at 7, and that services to be provided under
the contract would be ordered by issuance of task orders which *may be
issued from twelve months from date of issuance of contract.*  IFB S: I,
Ordering Clause, at 14.  The IFB incorporated by reference the contract
clause at Federal Acquisition Regulation (FAR) S: 52.222-41, *Service
Contract Act of 1965, as Amended,* and included various wage
determinations for the areas to be serviced by the contract.
    
Bid opening was originally scheduled for February 19, 2002, but was
repeatedly extended due to numerous rounds of questions by prospective
bidders and an agency-level protest.  Four bids, including Paragon's, were
received at the October 23 bid opening.  Paragon and the other apparent
low bidders were asked to verify their bid prices.  Ultimately, the Army
concluded that Paragon was the low bidder under several schedules and
another bidder was low under another four schedules. 
    
On December 9, the contracting officer canceled the IFB because she
determined that the contract performance period would end on January 31,
2003 and she was concerned that bidders may not have bid based on the same
performance period (12 months versus through January 31), and because the
Service Contract Act wage determinations included in the IFB were
outdated.  Agency Report, Tab P, Contracting Officer's Determination to
Reject All Bids Received and to Cancel Solicitation, Dec. 9, 2002; Tab EE,
Contracting Officer's Memorandum for Record, Jan. 2, 2003.
    
On December 20, the Army issued the RFQ seeking quotes for the
transportation services through March 31, 2003.
    
Paragon protests that the Army did not have a compelling reason to cancel
the IFB after bid opening and to issue an RFQ for the same services. 
Specifically, Paragon complains that on October 22 (prior to bid opening)
Paragon asked the agency what the performance period would be under the
IFB, and was informed that it would be for 12 months.  Paragon contends
that *all of the bidders submitted their sealed bid[s] based upon what was
to be a 12-month contract.*  Protester's Comments at 2.
    
Because of the potential adverse impact on the competitive bidding system
of cancellation after bid prices have been exposed, a contracting agency
must have a compelling reason to cancel an IFB after bid opening.  FAR S:
14.404-1(a)(1); Days Inn Marina, B-254913, Jan. 18, 1994, 94-1 CPD P: 23
at 2.  A compelling reason to cancel a solicitation exists where material
solicitation terms are ambiguous or in conflict.  P.J. Dick, Inc.,
B-259166, B-260333, Mar. 6, 1995, 95-1 CPD P: 131 at 4.  Contracting
officials have broad discretion to determine whether a compelling reason
to cancel exists, and our review is limited to considering the
reasonableness of that decision.  H. Angelo & Co., Inc., B-260680.2, Aug.
21, 1995, 95-2 CPD P: 74 at 3.
    
Here, we find that the Army reasonably concluded that it had a compelling
reason to cancel the IFB after bid opening.  The IFB contained conflicting
terms with respect to the contract performance period, which is a material
solicitation requirement.  See The Ryan Co., B-275304, Feb. 6, 1997, 97-1
CPD P: 62 at 3 n.1.  The bid schedule stated that the performance period
would expire January 31, 2003 (which was only 3 months after the October
23 bid opening date), but the IFB stated in other clauses that the period
of performance would be 12 months from the date of award.  The IFB also
incorporated by reference the standard *Order of Precedence--Sealed
Bidding* clause, FAR S: 52-214-29, which provides that solicitation
inconsistency are to be resolved by giving precedence in the following
order:  (1) bid schedule; (2) representations and instructions; (3)
contract clauses; (4) other documents, exhibits and attachments; and (5)
specifications.  Application of the Order of Precedence clause indicates
that, as argued by the Army, any contract awarded under the IFB would have
expired on January 31, 2003.
    
Paragon complains that it asked the agency before bid opening for
clarification of the contract performance period and was informed that the
performance period would be 12 months from date of award.  This only
indicates, however, that Paragon itself recognized that there was an
inconsistency in the material solicitations terms.  Furthermore, the
agency's advice that was apparently given only to Paragon did not amend
the IFB to correct this inconsistency.  See FAR S: 14.208 (solicitation
amendments should be written and must be furnished to all prospective
bidders).  In this regard, apart from Paragon's speculation, there is no
evidence of what other bidders understood the contract performance period
to be.
    
We do not think that the Army was required to award contracts under this
IFB with the intention of modifying the contract to extend the performance
period from January 31, 2003 for another 10 months in order to realize a
12-month performance period.  Furthermore, given that the wage
determination contained in the IFB is out of date, modifying the contract
after award may require that a new wage determination be applied to the
contract, see FAR S: 52.222-41(c)(2)(iv)(B), which may result in contract
claims against the agency.  We agree with the contracting officer that the
agency is not required to speculate as to what the contract price for
these services will be.
    
Paragon also complains that the Army should not have issued the RFQ for
these same services pending our decision in Paragon's protest of the
cancellation of the IFB.  Given our finding that the Army had compelling
reason to cancel the IFB after bid opening, we have no basis to object to
the agency's issuance of the RFQ to obtain these services for 3 months.
    
The protests are denied.
    
Anthony H. Gamboa
General Counsel