TITLE: B-299046.2, Para Scientific Company, February 13, 2007
BNUMBER: B-299046.2
DATE: February 13, 2007
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B-299046.2, Para Scientific Company, February 13, 2007
Decision
Matter of: Para Scientific Company
File: B-299046.2
Date: February 13, 2007
Hiram Reinhart for the protester.
Mogy E. Omatete, Esq., Department of Health and Human Services, 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
In a procurement conducted under simplified acquisition procedures,
agency's determination that it was in the best interests of the government
to make a single award to the vendor that submitted the lowest
total-priced quotation for all 22 items listed in a request for quotations
for laboratory supplies was unreasonable where the record demonstrates
that a second award to the protester for 6 of the requested items would
have resulted in a lower aggregate cost to the government and there is
nothing in the record to suggest that such an award would not have been in
the government's best interests.
DECISION
Para Scientific Company protests the award of a contract to Fisher
Scientific Company LLC under request for quotations (RFQ) No.
NIH-NIDDK-06-985, issued by the National Institute of Diabetes and
Digestive and Kidney Diseases, National Institutes of Health, Department
of Health and Human Services, for laboratory supplies.
We sustain the protest.
The RFQ listed 22 items and the quantity of the items that the agency
sought to purchase. For example, some of the items included "Pipet Sero
Disposable 25ml 200/cs" with a quantity sought of 10 cases, and "Box with
cover fiber board 3 inch 12/pack" with a quantity sought of 10 packs. RFQ
at 2. Next to each of the items listed and quantities sought, the RFQ
included blank spaces where vendors were to insert their unit price per
item and total prices based upon the stated quantities. The RFQ did not
require that vendors submit prices for all items, or indicate whether a
single award or multiple awards were contemplated.
The agency received quotations from eight vendors, including Fisher
Scientific and Para Scientific, with Fisher Scientific's quotation
providing a total price of $32,159 for all items listed. Para Scientific's
quotation, which did not include pricing for 2 of the 22 listed items,
provided a total price for the remaining 20 items of $67,739.[1]
Contracting Officer's Statement at 2; Agency Report (AR), Tab 5, Para
Scientific Quotation, at 3. The agency awarded a contract for the items to
Fisher Scientific.[2]
The protester argues, among other things, that to the extent that its
quotation included prices lower than those furnished by the awardee for
any of the items solicited, the agency should have awarded a contract to
the protester for those lower priced items.[3] Protester's Comments at
1-2. The agency responds that "[a]lthough the RFQ package did not state
that vendors were required to propose on all line items, it was in the
Government[']s best interest to award to a vendor that could provide all
requested items with the lowest price." Contracting Officer's Statement at
1-2.
Section 13.101(b)(1) of the Federal Acquisition Regulation (FAR) expressly
recognizes that either single or multiple awards are permissible in the
context of simplified acquisitions, [4] and our Office has consistently
held that where, as here, a solicitation does not require a single award,
multiple awards may be made. See, e.g., Weather Experts, Inc., B-255103,
Feb. 9, 1994, 94-1 CPD para. 93 at 3 (invitation for bids (IFB)); Goodman
Ball, Inc., B-217318, Mar. 25, 1985, 85-1 CPD para. 348 at 3 (IFB). Given
that it was within the agency's discretion to make either a single award
or multiple awards, we review for reasonableness the agency's exercise of
that discretion in making a single award to Fisher Scientific. See Weather
Experts, Inc., supra; American Bank Note Co., B-222589, Sept. 18, 1986,
86-2 CPD para. 316 (RFP).
Although the FAR recognizes that multiple awards may be made under FAR
Part 13 procurements, neither the FAR nor case law provides any specific
guidance as to when multiple awards are either appropriate or required in
these procurements. The FAR does, however, provide guidance regarding
single or multiple awards in the context of sealed bidding and negotiated
acquisitions. For example, in the context of sealed bidding, the FAR
advises that IFBs are to provide for multiple awards where the contracting
officer determines that multiple awards "might be made if doing so is
economically advantageous to the Government." FAR sect. 14.201-6(q).
Section 14.201-8(c) of the FAR adds that after the receipt of bids, "[t]he
contracting officer shall assume, for the purpose of making multiple
awards, that $500 would be the administrative cost to the Government for
issuing and administering each contract awarded under a solicitation," and
that "[i]ndividual awards shall be for the items or combinations of items
that result in the lowest aggregate cost to the Government, including the
assumed administrative costs." In the context of negotiated acquisitions,
the FAR requires that RFPs inform offerors that "the Government reserves
the right to make multiple awards if, after considering the additional
administrative costs, it is in the Government's best interest to do so."
FAR sect. 52.215-1(f)(6); see FAR sect. 15.209(a) (requiring the inclusion
of FAR sect. 52.215-1). Although neither Part 14 or Part 15 of the FAR is
applicable to the simplified acquistion here, we believe the
above-referenced provisions of these parts are instructive regarding the
reasonableness of the agency's determination that multiple awards were not
in the government's best interests.
The agency explains with regard to its determination to make a single
award to Fisher Scientific as follows:
This award was for a fixed amount of items that are consistently offered
commercially by vendors. The rationale for making one award was mainly
due to making sound business and financial sense. To make multiple
awards would create an administrative financial burden as well as
ineffective use of Government resources. For example, to make more than
one award on one requisition, it would create the same amount of
administrative burden/resources for each subsequent award (i.e., staff
time, administrative costs, shipping costs, etc.). Given the small
amount of the procurement ($32,159.12), it would have been a minimal
saving for splitting this into two awards. So, in turn, one order is
financially beneficially to the Government than making more than one
award to multiple vendors. Thus, the Government determined that it was
in its best interest to make one complete award which provide the best
value for the Government.
Contracting Officer's Supplemental Statement at 1.[5]
Contrary to the agency's assumptions regarding the potential savings that
could be achieved given the "small amount of the procurement," a review of
the item-by-item prices quoted by Para Scientific and Fisher Scientific
reveals that Para Scientific's prices for six of the items are
substantially less than the prices quoted by Fisher Scientific, and that
the agency would have saved the government, absent the consideration of
any adminstrative costs incurred, a total of $8,363.97, had the agency
made an award to Para Scientific for those items.[6] Given that in an IFB
context the administrative expenses are assumed to be $500 for each
additional award, the savings that could have been achieved through an
additional award to Para Scientific would appear to more than offset any
additional administrative costs the agency would have incurred, and as
such, there is nothing in the record to suggest that it would have been
other than "economically advantageous to the Government" or other than "in
the Government's best interest" to make such an award.[7] See FAR sections
14.201-6(c), 52.215-1(f)(6); Weather Experts, Inc., supra. Accordingly, we
find that the agency's determination here lacks a reasonable basis, and
that the agency should have awarded an additional contract under this RFQ
to Para Scientific for the six items for which Para Scientific quoted
lower prices.
The protest is sustained. The agency has informed our Office and the
protester that because Para Scientific's initial protest to our Office was
not filed within 10 days of the award to Fisher Scientific "[n]o stay of
contract award was issued." Agency Corrective Action Letter (Nov. 6,
2006). The agency adds here that as of November 6, it had taken delivery
of 21 of the 22 items. Given this, we recommend that the agency reimburse
the protester its quotation preparation costs, as well as the costs of
filing and pursuing its protests, including reasonable attorneys' fees.
4 C.F.R. sect. 21.8(d)(1) (2006). In accordance with section 21.8(f) of
our Regulations, Para Scientific's claim for such costs, detailing the
time expended and the costs incurred, must be submitted directly to the
agency within 60 days after receipt of the decision.
Gary L. Kepplinger
General Counsel
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[1] Neither Fisher Scientific nor Para Scientific qualified its quotation
as "all or none."
[2] The RFQ did not identify any evaluation criteria, nor did it inform
vendors of the basis for the agency's award selection. Although Federal
Acquisition Regulation (FAR) sect. 13.106-2 affords contracting officers
using simplified acquisition procedures, as here, discretion in
determining how to conduct a procurement and in fashioning suitable
evaluation procedures, this discretion does not permit a failure to
identify significant evaluation factors in the RFQ or evaluating
quotations on the basis of factors not announced in the RFQ. American
Artisan Prods., Inc., B-278450, Jan. 30, 1998, 98-1 CPD para. 37 at 4.
Rather, FAR sections 13.106-1(a)(2) and 13.106-2(a)(2) specifically
require that solicitations advise potential vendors of the basis upon
which award is to be made, and agencies must conduct evaluations based on
the criteria set forth in the solicitations. Id. Nevertheless, because
price was the only term requested by the solicitation at issue here, price
was necessarily the sole evaluation factor. Brewer-Taylor Assocs.,
B-277845, Oct. 30, 1997, 97-2 CPD para. 124 at 3.
[3] The protester also argues that the agency's debriefing was inadequate.
Whether or not an agency provides a debriefing and the adequacy of a
debriefing are issues that our Office will not consider, because the
scheduling and conduct of a debriefing is a procedural matter that does
not involve the validity of an award. The Ideal Solution, LLC, B-298300,
July 10, 2006, 2006 CPD para. 101 at 3 n.2; see Symplicity Corp.,
B-297060, Nov. 8, 2005, 2005 CPD para. 203 at 3 n.4.
[4] FAR sect. 13.101(b)(1) states, "In making purchases, contracting
officers should-- (1) Include related items (such as small hardware items
or spare parts for vehicles) in one solicitation and make award on an
`all-or-none' or `multiple award' basis provided suppliers are so advised
when quotations or offers are requested." As indicated above, the RFQ did
not state whether a single award of all items would be made or whether
multiple awards would be made.
[5] In contrast to this post-protest statement, there is no indication in
the contemporaneous record that the agency engaged in any analysis as to
whether it was in the government's best interests to make a single award
or multiple awards.
[6] The six items are: (1) "Art 1000G filter TP singles 500/pk," (2) "Box
with cover fiber board 3 inch 12/pack," (3) "200 ul ylw bevtip rack
ster960/P 5 pack/case," (4) "Cryogvial SS 2ml 500/case," (5) "Tissue/tek
cryomold 100/pack," and (6) "Cryovial ss 1.2ml 500/case."
[7] As noted, the agency has provided no non-cost related reasons why
these items need to be procured from a single vendor.