TITLE:  Oregon Potato Company, B-294839, December 27, 2004
BNUMBER:  B-294839
DATE:  December 27, 2004

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   Decision

   Matter of:   Oregon Potato Company

   File:            B-294839

   Date:           December 27, 2004

   Richard A. Sargent for the protester.

   Michael Gurwitz, Esq., Department of Agriculture, for the agency.

   Kenneth Kilgour, Esq., and Christine S. Melody, Esq., Office of the
General Counsel, participated in the preparation of the decision.

   DIGEST

   Protest regarding procurement for supply of commodity for export overseas
is sustained where the solicitation failed to advise offerors that an
offer would not be considered if, in a separate procurement seeking bids
to transport the commodity to the ultimate destination, the agency failed
to receive a bid corresponding to an offeror's proposed delivery
location.  Without this information, offerors lacked sufficient
information to prepare their offers intelligently and to compete on an
equal basis.

   DECISION

   Oregon Potato Company (OPC) protests the rejection of its offer under
invitation No. 094E, issued by the Commodity Credit Corporation, Farm
Service Agency, Kansas City Commodity Office, for dehydrated potato flakes
for export to the nation of Moldova.  OPC argues that the invitation
failed to disclose a key factor necessary for the firm to intelligently
prepare its offer.

   We sustain the protest.

   The invitation, issued on September 3, 2004, called for a specified
quantity of potato flakes divided between two shipping periods.  With
regard to delivery of the potato flakes by the offeror, the invitation
stated that "[d]elivery will be either [free alongside steamer (f.a.s.)],
intermodal plant, or intermodal bridge as specified in the contract." 
Invitation at 2.  With regard to specific delivery locations, the
invitation stated that offerors should submit prices for the potato flakes
based on delivery by the offeror to any location listed on the agency's
form KC-362, the offeror's plant location, or any of the nine plant
locations already listed in the invitation.  The form KC-362 is a list of
U.S. ports of export and "U.S. intermodal points," which are plant
locations and bridges identified by city and state. 

   Offerors were advised that award would be made on the basis of "the total
cost to the Government to deliver the product to the ultimate
destination."  Announcement DPP1 P 4.B. [1]  In this regard, the agency,
in a separate procurement action using the services of a freight
forwarding agency, issued a solicitation seeking bids to transport the
potato flakes from the United States to Moldova.  The agency's intention
was to add to an offeror's price for supply of the potato flakes, the
price of shipping the potato flakes to Moldova from the delivery location
specified by the offeror.  Thus, the evaluated price would consist of the
offeror's price plus the cost of transportation from the offeror's
specified delivery location to Moldova.

   OPC submitted offers for both quantities sought, specifying the delivery
location as f.a.s. Tacoma, Washington, one of the ports listed on the
agency's form KC-362. Although the invitation invited offers for
locations on the KC-362, and although f.a.s. Tacoma was a location on the
KC-362, the agency in fact received no bids for transportation from Tacoma
to Moldova under its freight services solicitation. [2]  Because there was
no transportation bid corresponding to OPC's proposed delivery location,
the agency concluded that it could not calculate the cost of OPC's offer,
and therefore did not consider the offer for award.  The invitation
nowhere stated that the lack of a corresponding transportation bid would
render an offer ineligible for award. 

   A solicitation must contain sufficient information to allow offerors to
compete intelligently and on an equal basis.  Sea-Land Serv., Inc.,
B-246784.2, Aug. 24, 1992, 92-2 CPD P 122 at 10.   Offerors can compete on
equal terms only if they know in advance the basis on which their
proposals will be evaluated.  Roth-Radcliff Co. Inc., B-213872.2, June 1,
1984, 84-1 CPD P 589 at 5. 

   Here, in bidding f.a.s. Tacoma, OPC offered delivery of the requested
commodity at a location listed in the KC-362, as specifically authorized
by the terms of the invitation.  However, OPC lacked a critical piece of
information necessary for it to compete intelligently and on an equal
basis--that acceptance of its offer depended on receipt by the agency of a
transportation bid matching its delivery location, in a solicitation for
freight bids that was being conducted roughly concurrently with the
procurement for the potato flakes.  OPC thus bid f.a.s. Tacoma without the
knowledge that it risked being ineligible for award if the transportation
solicitation did not produce a corresponding transportation bid.  The
agency's failure to alert offerors to this potentially fatal pitfall meant
that OPC lacked sufficient information to bid intelligently on this
invitation; that is, had OPC known about the risk that its offer might not
be considered depending on the outcome of the solicitation for
transportation bids, it might have offered delivery to other locations
(for example, to its plant location, as did the other offerors), or
decided not to compete at all.  

   The agency makes two arguments that we find unpersuasive.  First, as the
agency argues, there is no dispute that the protester was on notice that
the basis for the contract award would be total cost to the government,
namely, the price of the potato flakes plus the price for freight to
Moldova.  This is not the same thing as being on notice that the agency
will not consider any offers proposing delivery of the commodity to a
location for which there is no freight bid received.  Nor, contrary to the
agency's argument, is our conclusion here inconsistent with the principle
that the government may impose substantial amounts of risk on an offeror. 
The defect here is that offerors were not advised of the degree of that
risk, a factor critical to preparing their offers. 

   In similar circumstances, we generally would recommend that the
solicitation be amended and reissued.  That remedy is not feasible in this
case, however, since the agency proceeded with performance of the
contract, citing the urgent need to deliver the potato flakes to Moldova. 
Accordingly, we recommend that OPC be reimbursed the costs of preparing
its offer, as well as its costs of filing and pursuing this protest,
including reasonable attorneys' fees.  Bid Protest Regulations, 4 C.F.R. S
21.8(d) (2004).  OPC should submit its certified claim for such costs,
detailing the time

   expended and costs incurred, directly to the agency within 60 days of
receipt of this decision.   4 C.F.R. S 21.8(f)(1).

   The protest is sustained.

   Anthony H. Gamboa

   General Counsel

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   [1] The invitation here was issued subject to the terms and conditions of
the agency's Announcement DPP1, a document which sets out general
requirements pertaining to purchases of dehydrated potato products for use
in export programs. 

   [2] In fact, it appears that the agency requested transportation bids only
for the production plant locations listed in the invitation itself.  That
is, the freight solicitation seeking transportation bids stated that
"carriers are encouraged to offer on all of the following intermodal plant
points," and continued with a listing of the specific production plant
locations listed in the invitation or otherwise identified by potential
suppliers.  When asked by our Office why it did not specifically seek bids
also for the ports and other locations listed in the form KC362, the
agency replied that the specific locations were intended only as an
addition to the locations listed in the KC-362.  In this regard, the
agency pointed to language in note 9 of the freight solicitation stating
that "commodity, loadport, and intermodal point abbreviations [are] as per
USDA Form KC-362," and asserted that the freight carriers' standard
procedure is to bid on the ports and bridges listed on the KC-362. 
Despite the reference to the KC-362, given the language in the freight
solicitation encouraging carriers to bid on the specifically listed plant
production locations, the clear implication is that the agency was
interested in receiving bids only for those locations.
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