TITLE: B-296961, Fort Mojave/Hummel, a Joint Venture, October 18, 2005
BNUMBER: B-296961
DATE: October 18, 2005
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B-296961, Fort Mojave/Hummel, a Joint Venture, October 18, 2005

   Decision

   Matter of: Fort Mojave/Hummel, a Joint Venture

   File: B-296961

   Date: October 18, 2005

   Robert P. McManus, Esq., Taft, Stettinius & Hollister LLP, for the
   protester.

   Frank P. Buckley, Esq., Charles D. Raymond, Esq., and Harry L. Sheinfeld,
   Esq., Department of Labor, for the agency.

   John L. Formica, Esq., and James A. Spangenberg, Esq., Office of the
   General Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Agency improperly rejected low bid as nonresponsive where the bid failed
   to acknowledge a solicitation amendment that merely clarified requirements
   already contained in the solicitation and otherwise had a negligible
   effect on the quality and price of the construction project bid upon.

   DECISION

   Fort Mojave/Hummel, a Joint Venture, protests the rejection of its bid
   submitted in response to invitation for bids (IFB) No. DOL 051RB20042,
   issued by the Department of Labor, for the construction of the new Job
   Corps Center in Cleveland, Ohio. Fort Mojave/Hummel's bid was rejected as
   nonresponsive because it did not contain an acknowledgment of amendment
   No. 1 to the IFB.

   We sustain the protest.

   The successful bidder under the IFB will be required to construct nine new
   buildings totaling approximately 190,997 gross square feet, including
   "three (3) 136 person Dormitories, an Administration-Medical/Dental
   building, a Recreation building, a Cafeteria building, an Education
   building, a Vocational Education building, and a Warehouse." The buildings
   will be "located on a 24 acre parcel of undeveloped land," with the
   successful bidder also being required to perform "miscellaneous site
   improvements in the form of general landscaping; earthwork; roads and
   walks; parking; drainage; water, sewerage, and gas utilities; electric
   ductbank; and site/security lighting for the new buildings." IFB at
   01010-1. One amendment to the IFB was issued prior to bid opening, which
   answered 28 bidder questions and clarified the period of performance.

   The agency received the following four bids by the bid opening date of May
   26, 2005:

   +------------------------------------------------------------------------+
   |        Fort Mojave/Hummell         |            $31,399,000            |
   |------------------------------------+-----------------------------------|
   |                KBJ                 |            $31,764,000            |
   |------------------------------------+-----------------------------------|
   |              Odyssey               |            $34,779,000            |
   |------------------------------------+-----------------------------------|
   |              New Era               |            $34,900,000            |
   +------------------------------------------------------------------------+

   Agency Report (AR), Tab 12, Bid Abstract. The agency found that Fort
   Mojave/Hummel's apparent low bid did not contain an acknowledgment of the
   amendment. The agency reviewed the amendment, and determined that although
   most of the matters in it were not material, it made two changes to the
   IFB that were material. The agency thus rejected Fort Mojave/Hummel's bid
   as nonresponsive.

   After filing an agency-level protest, which was denied, Fort Mojave/Hummel
   filed this protest with our Office, arguing that the amendment cannot
   properly be considered material and that its bid therefore should not have
   been rejected as nonresponsive.

   A bidder's failure to acknowledge a material amendment to an IFB renders
   the bid nonresponsive, since absent such an acknowledgment the
   government's acceptance of the bid would not legally obligate the bidder
   to meet the government's needs as identified in the amendment. Federal
   Constr., Inc., B-279638, B-279638.2, July 2, 1998, 98-2 CPD para. 5 at 2.
   An amendment is not material and the failure to acknowledge it should be
   waived as a minor informality where the amendment has no effect or merely
   a negligible effect on the price, quantity, quality, delivery of the item
   bid upon, or no effect on the relative standing of the bidders. Federal
   Acquisition Regulation sect. 14.405(d)(2); Kalex Constr. & Dev., Inc.,
   B-278076.2, Jan. 20, 1998, 98-1 CPD para. 25 at 2. Additionally, an
   amendment is not material where it does not impose any legal obligations
   on the bidder different from those imposed by the original solicitation;
   for example, where it merely clarifies an existing requirement or is a
   matter of form. Kalex Constr. & Dev., Inc., supra. Nevertheless, a
   procuring agency is not required to enter into a contract which presents
   the potential for litigation stemming from an ambiguity in a solicitation.
   ACC Constr. Co., B-277554, Sept. 22, 1997, 97-2 CPD para. 84 at 4. Rather,
   an agency has an affirmative obligation to avoid potential litigation by
   resolving solicitation ambiguities prior to bid opening, and amendments
   clarifying matters which could otherwise engender disputes during contract
   performance are generally material and must be acknowledged. Id. No
   precise rule exists to determine whether an amendment is material; rather,
   that determination is based on the facts of each case. Dyna Constr., Inc.,
   B-275047, Jan. 21, 1997, 97-1 CPD para. 31 at 3.

   In rejecting Fort Mojave/Hummel's bid and defending this protest, the
   agency only contends that only two of the items set forth in the amendment
   are material: one item pertains to the insulation of certain pipes and the
   other item pertains to the placement of certain pipes in five of the rooms
   in the vocational education building.

   Pipe Insulation

   Section 15180 of the IFB details the requirements for mechanical
   (including pipe) insulation. This section includes a "Pipe Insulation
   Thickness Schedule" that is arranged as a matrix, and which provides the
   minimum insulation thickness for the different piping system types.
   Included in this matrix, as set forth in the original IFB, is the
   following under piping system type: "Storm drainage or downspout above
   crawl space (horz. & vert.) and drain, waste, and vent." IFB at 15180-3.
   The IFB amendment changed this item by deleting the phrase "above crawl
   space," so that the matrix, after the issuance of the amendment to the
   solicitation, provided for the insulation of "Storm drainage or downspout
   (horz. & vert.) and drain, waste, and vent." Amend. 1, at 2.

   A hearing was conducted at our Office, during which testimony was received
   from the architect/project manager who was responsible for, among other
   things, preparing the specifications and drawings included in the
   solicitation.[1] By way of background, the architect/project manager
   explained that in accordance with industry standards a "crawl space" is "a
   space which resides between the first floor of a building and the ground."
   Hearing Transcript (Tr.) at 53-54. The architect/project manager explained
   that for this contract buildings will be constructed "concrete on the
   ground" and as such will not have crawl spaces. Tr. at 18, 20, 37, 81. The
   architect/project manager further explained that the original IFB's
   reference to a "crawl space" was an error, and at one point testified with
   regard to the insulation requirements that the IFB as initially issued was
   "gray because of those three words `above crawlspace.'" Tr. at 16, 37, 55.
   The architect/project manager later clarified, however, that in his view
   and consistent with industry standards, the IFB's specifications prior to
   the issuance of the amendment could only have been reasonably read as
   having the same meaning as the IFB's specifications as amended, that is,
   as requiring the insulation of all interior storm drainage or downspout
   piping, given that none of the buildings in fact will be built with crawl
   spaces. Tr. at 57-58, 63, 67.

   In our view, given the architect/project manager's explanation and the
   IFB's specifications and drawings, which provide that the buildings will
   be "concrete on ground" without crawl spaces, we agree that the
   solicitation, both as initially issued and as amended can only be read as
   requiring the same thing--the insulation of all interior storm drainage or
   downspout piping.[2] Given that this aspect of the amendment does not have
   any effect on the work bid upon, that is, it does not impose any legal
   obligations on the bidder different from those imposed by the original
   solicitation or affect the quality or price of the project, it is at best
   a clarification of an existing requirement and cannot properly be
   considered material.

   Pipe Placement

   The other item in the amendment (at 3) pointed to by the agency as
   constituting a material change provided for the inclusion of the following
   note on the IFB's drawing B-P2.1 -- Plumbing Floor Plan:

   All above grade piping in rooms B104, B115, B123, B134 and B146 shall be
   run high in joist space.

   At the hearing conducted by our Office, the architect/project manager
   explained that the rooms listed in the above note are vocational shops
   located in the vocational education building, and that the agency
   required, where possible, "a 14-foot high ceiling space."[3] Tr. at 84.
   The architect/project manager added by way of background that the
   buildings would have "open ceilings," such that the joists,[4] and all
   piping as well as the necessary ductwork, would be visible to the rooms'
   occupants. Tr. at 109-10. In addition to gaining the required clearance,
   the architect/project manager explained, the piping was required to be
   "run high in joist space" for aesthetic reasons. Specifically, the
   architect/project manager explained that the piping, joists and ceiling
   will be painted white, so that the piping (described by the
   architect/project manager as "very ugly") will visually blend into the
   ceiling. Tr. at 118. The architect/project manager explained that the note
   that "[a]ll above grade piping in rooms B104, B115, B123, B134 and B146
   shall be run high in joist space" was intended to "make it very clear to a
   bidder that he had to do some special routing of this piping" in order to
   meet the agency's requirements in this regard concerning minimum overhead
   clearance and aesthetics. Tr. at 84.

   The architect/project manager conceded at the hearing that the IFB as
   issued included a "Mechanical General Requirements" section, and within
   that section, an "Interferences" subsection (at 15010-7), which provided
   in relevant part:

   Install additional offsets in new piping or ductwork where required to
   obtain maximum headroom or to avoid conflict with other work without
   additional cost to Owner.[5]

   The architect/project manager specifically testified that, as argued by
   the protester, because of the requirement in the "Interferences"
   subsection to install additional offsets in piping to obtain maximum
   headroom, the piping was required by the terms of the IFB as initially
   issued (prior to issuance of the amendment) to be placed high in the joist
   spaces in order to obtain maximum headroom.[6] Tr. at 173, 176; see
   Protester's Post-Hearing Comments at 6. The architect/project manager also
   testified that a contractor, reading the IFB as issued (pre-amendment),
   along with each of the drawings furnished by the agency with the IFB,
   should have understood that they had to "bid [the job] to take the
   [piping] all the way up." Tr. at 104.

   At another point, the architect/project manager testified that in his view
   the solicitation, prior to the issuance of the amendment, could also be
   interpreted as requiring, consistent with the above-quoted Interferences
   subsection, that the piping be placed, at a minimum, on the "under side of
   the joists," that is, attached to the bottom of the joists. Tr. at 184,
   188. He estimated that the costs involved with placing the piping "high in
   the joist space" rather than on the underside of the joists at $10,000.
   Tr. at 204.

   As explained below, we agree with the protester that under either of the
   above interpretations provided by the architect/project manager, the
   amendment's note that the piping in the rooms listed be placed "high in
   joist space," viewed in the context of the solicitation as a whole, does
   not constitute a material change.[7] See Protester's Post-Hearing Comments
   at 6. In this regard, we first note that this amendment affects only a
   small aspect of the IFB, which provides for the award of a comprehensive
   construction contract for nine new buildings totaling approximately
   190,997 gross square feet, on a 24-acre parcel, with a contract value of
   more than $31 million. As discussed above, the architect/project manager
   explained that the requirement that certain piping be "run high in joist
   spaces" either was provided for by the IFB as issued, or required merely a
   slightly different placement of the piping in only five rooms in only one
   of the nine buildings to be constructed. Assuming the amendment is
   considered as requiring a slightly different placement of the piping (as
   opposed to merely clarifying the IFB requirements), the agency's estimate
   of the cost impact of the amendment is negligible in the context of the
   contract as a whole--$10,000 versus $31,399,000 bid by Fort Mojave/Hummel.
   Moreover, because Fort Mojave/Hummel's bid price is $365,000 lower than
   the next low bid, the $10,000 estimated cost of the slightly different
   placement of the piping would have no effect on the relative standing of
   the bidders. Under the circumstances, the addition of the note can best be
   characterized as no more than a minor modification of what was already
   required by the IFB, not, as the agency suggests, the imposition of a
   material, new and separate legal obligation. Thus, we do not agree with
   the agency that Fort Mojave/Hummel's failure to acknowledge the amendment
   to the solicitation rendered its bid nonresponsive. See Head Inc.,
   B-233066, Jan. 25, 1989, 89-1 CPD para. 82 at 4 (amendment's change to a
   small portion of a sprinkler system from a sidewall type to an overhead
   type was not material in that it made only a minor modification to a
   requirement in the IFB and had de minimis effect on price).

   We recommend that award be made to Fort Mojave/Hummel if it is determined
   to be a responsible contractor. We also recommend that Fort Mojave/Hummel
   be reimbursed the reasonable costs of filing and pursuing the protest,
   including reasonable attorneys' fees. 4 C.F.R. sect. 21.8(d)(1). Fort
   Mojave/Hummel should submit its certified claim for costs, detailing the
   time expended and costs incurred, directly to the agency within 60 days of
   receiving this decision.

   The protest is sustained.

   Anthony H. Gamboa

   General Counsel

   ------------------------

   [1] The project's architect/project manager is employed by a
   private-sector firm with which the agency has a contract.

   [2] We note that the architect/project manager's testimony differed from
   the position taken in the agency report, which argued that the "[t]he
   deletion of the phrase `above crawl space' meant that all storm drainage
   and downspout piping was required to be insulated not just the storm
   drainage and downspout piping above the crawl space." AR at 6. As
   indicated by the testimony of the architect/project manager, this argument
   appears to be predicated on the erroneous belief that the buildings would
   be built with crawl spaces. The testimony of the architect/project manager
   also differs from the position taken in the agency's supplemental report
   where, while conceding that the buildings would be built "concrete on
   ground," it is argued that based upon the definition of crawl space in
   "Webster's Ninth New Collegiate Dictionary (1984) . . . a bidder may have
   viewed the original specifications as imposing an obligation to insulate
   only storm drainage and downspout piping above the ceiling." Agency
   Supplemental Report at 2. Given the architect/project manager's testimony,
   we give no weight to these agency arguments. We also note in this regard
   that after the architect/project manager's testimony the agency provided
   no further argument in its post-hearing comments that the pipe insulation
   clarification was material.

   [3] The record reflects that the ceilings in certain of these rooms would
   be sloped, with ceiling heights ranging from 8 feet to 26 feet. Tr. at
   195.

   [4] A "joist" is a "[a] structural load-carrying member with an open web
   system which supports floors and roofs utilizing hot-rolled or cold-formed
   steel and is designed as a simple span member." Agency Submission (Oct. 3,
   2005), International Organization for Standardization.

   [5] The architect/project manager defined the term "headroom" here as
   "clearance above . . . the occupants." Tr. at 174; see Tr. at 203.

   [6] As noted by the agency, the architect/project manager initially
   testified that the IFB failed to provide any specification, clause, or
   drawing providing for where the piping is to be placed in any of the
   buildings. Agency's Post-Hearing Comments at 1-2; Tr. at 93, 97-98,
   100-01. However, later in the hearing during cross-examination, the
   architect/project manager recognized and explained the applicability of
   the "Interferences" subsection to the issue as outlined above.
   Nevertheless, it is now argued in the agency's post-hearing comments that
   the Interferences subsection "does not even apply" to the general
   placement of piping, but rather "comes in to play only when there is a
   problem with work of one contractor interfering with the work of another."
   Agency's Post-Hearing Comments at 5. This view is inconsistent with that
   of the architect/project manager (as corrected and clarified during the
   course of the hearing) who drafted the solicitation; moreover, nothing in
   the Interferences subsection limits its applicability in the manner
   argued.

   [7] The agency argued in its report to our Office that this aspect of Fort
   Mojave/Hummel's protest should be dismissed as untimely because it was not
   raised by Fort Mojave/Hummel in its protest to the contracting agency. Our
   Bid Protest Regulations provide that where, as here, a protest has been
   initially filed with the contracting agency, we will consider a subsequent
   protest if the initial protest was timely filed. 4 C.F.R. sect. 21.2(a)(3)
   (2005). Because our regulations do not provide for the unwarranted
   piecemeal presentation of protest issues, where a protester initially
   files a timely agency-level protest, and subsequently files a protest with
   our Office which includes additional grounds, the additional grounds must
   independently satisfy our timeliness requirements. Wilderness  Mountain
   Catering, B-280767.2, Dec. 28, 1998, 99-1 CPD para. 4 at 5. Here, while
   the agency-level protest only specifically discusses why the pipe
   insulation issue was not material, it specifically recognizes the pipe
   placement issue and contends that the other matters addressed in the
   amendment were only "clarifications." Indeed, the pipe placement issue was
   labeled a "clarification" in the agency analysis of the amendment provided
   to Fort Mojave/Hummel prior to filing its agency-level protest. AR, Tab 9,
   Architect/Project Manager's Explanation, at 1, 3. Considering that we
   resolve doubts regarding timeliness in favor of protesters, Sigmatech,
   Inc., B-296401, Aug. 10, 2005, 2005 CPD para. 156 at 5, we find Fort
   Mojave/Hummel's protest of this issue to be timely.