D. M. & E. of Las Vegas, Inc.

B-270288 Feb 23, 1996 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Completion of acquisition through negotiation after cancellation of invitation for bids (IFB) was improper where agency revised material solicitation requirement (delivery schedule). Which could have influenced the scope of original competition. Award to NATCO/Carlton was made after the solicitation was converted from an invitation for bids (IFB) to an RFP. The Corps of Engineers should have proceeded with a new acquisition. Which was issued on July 21. D. M. & E. and NATCO/Carlton were the only bidders to respond to the IFB. NATCO/Carlton's bid was $197. M. & E.'s bid was $257. M. & E. was nonresponsible because it could not comply with the required delivery schedule. M. & E. is a small business. View Decision Matter of: D. M. & E. of Las Vegas, Inc. File: B-270288 Date: February 23, 1996 Completion of acquisition through negotiation after cancellation of invitation for bids (IFB) was improper where agency revised material solicitation requirement (delivery schedule), which could have influenced the scope of original competition, at the time it converted acquisition from IFB to request for proposals. Attorneys DECISION D. M. & E. of Las Vegas, Inc. protests the award of a contract for two radial drilling machines to NATCO/Carlton under request for proposals (RFP) No. DACW62-95-R-0047, issued by the Department of the Army, Corps of Engineers. Award to NATCO/Carlton was made after the solicitation was converted from an invitation for bids (IFB) to an RFP. D. M. & E. contends that rather than converting the IFB to an RFP and negotiating with NATCO/Carlton, the Corps of Engineers should have proceeded with a new acquisition. We sustain the protest. BACKGROUND IFB No. DACW62-95-B-0026, which was issued on July 21, 1995, sought bids for one floor mounted radial drilling machine, with an option, exercisable by the government at the time of award, for a second machine. The solicitation defined the required characteristics of the machine(s) and instructed bidders to submit descriptive literature with their bids to enable the agency to verify compliance with the enumerated requirements. The IFB called for delivery of the radial drill(s) within 120 days after award. D. M. & E. and NATCO/Carlton were the only bidders to respond to the IFB. Both indicated that they would furnish drills manufactured by NATCO/Carlton. NATCO/Carlton's bid was $197,000 and D. M. & E.'s bid was $257,990. In a cover letter accompanying its bid, NATCO/Carlton took exception to the IFB's delivery requirement, stating that it would require 240 days for delivery of the optional unit. The contracting officer accordingly rejected NATCO/Carlton's bid as nonresponsive. The contracting specialist then contacted D. M. & E. to begin gathering pre-award information. After she had explained to D. M. & E.'s representative her basis for rejecting NATCO/Carlton's bid as nonresponsive, the protester's representative stated that D. M. & E. could not meet the delivery schedule either. The contracting specialist asked D. M. & E. to confirm this in writing, which it did by letter dated August 30. Upon receipt of this letter, the contracting officer determined, in accordance with Federal Acquisition Regulation (FAR) section 9.104-1(b), that D. M. & E. was nonresponsible because it could not comply with the required delivery schedule. Because D. M. & E. is a small business, she then referred the matter to the Small Business Administration (SBA) pursuant to FAR section 19.602-1. By letter dated September 20, the SBA informed the contracting officer that the protester had declined to file an application for a certificate of competency and that the SBA was closing its file on the matter. Because the government had failed to receive a responsive bid from a responsible bidder, the contracting officer determined that cancellation of the IFB and conversion to negotiation was appropriate. See FAR section 15.103, 14.404-1(c)(8) and (e)(1). By amendment dated September 26, she converted the IFB to RFP No. DACW62-95-R-0047. The amendment also changed the delivery period for the second drill from 120 days to 240 days. Since FAR section 15.103 refers to negotiation with responsible bidders only and D. M. & E. had been determined nonresponsible under the IFB, the contracting officer transmitted a copy of the amendment to NATCO/Carlton only. NATCO/Carlton proposed a price of $197,000--the same price that it had bid under the IFB--and on September 29, the Corps of Engineers awarded it a contract. D. M. & E. learned of the award to NATCO/Carlton on October 23 and protested to our Office the following day. D. M. & E. protests the award to NATCO/Carlton, arguing that rather than converting from sealed bidding to negotiated procedures and changing the delivery period, the agency should have conducted a new acquisition.