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(A) Specific information as to how (j) Nothing contained in this $ 1and when the mistake was alleged or 2.406-4 prevents an agency from subdisclosed;

mitting doubtful cases to the Comp(B) A summary of the evidence sub- troller General. mitted by the contractor;

[29 FR 10141, July 24, 1964, as amended at (C) His opinion whether a bona fide

41 FR 27726, July 6, 1976) mistake was made in the bid and whether he was, or should have been, § 1-2.407 Award. on constructive notice of the mistake before the award, together with the $ 1-2.407-1 General. reasons or data upon which his opin (a) Unless all bids are rejected, ion is based;

award shall be made by the contract(D) In the event only one bid was re ing officer by written notice, within ceived, a quotation of a recent con the time for acceptance specified in tract price for the supplies or services the bid or extension thereof, to that involved or, in the absence of a recent responsible bidder whose bid, conformcomparable contract, the contracting ing to the invitation for bids, will be officer's estimate of a fair price for the most advantageous to the Governsupplies or services, and the basis for ment, price and other factors considsuch estimate;

ered. (For discussion of other factors (E) Any additional evidence consid to be considered, see § 1-2.407-5.) ered pertinent, including copies of all Award shall not be made until all rerelevant correspondence between the quired approvals have been obtained. contracting officer and the contractor (b) If less than three bids have been concerning the alleged mistake;

received, the contracting officer shall (F) The course of action with respect examine, to the extent deemed approto the alleged mistake that the con- priate in accordance with agency protracting officer considers proper on cedures, the reasons for the small the basis of the evidence, and, if other number of bids received. The purpose than a change in contract price is rec of this examination is to ascertain ommended, the manner by which the whether the small number of reitem will otherwise be procured; and sponses is attributable to an absence

(G) The status of performance and of any of the prerequisites of formal payments under the contract, includ. advertising. (For discussion of the preing contemplated performance and requisites of formal advertising, see payments.

$ 1-2.101.) Award shall be made; how(g) Nothing contained in this $ 1- ever, the record of the invitation for 2.406-4 shall deprive the Comptroller bids (see § 1-2.204) shall include a recGeneral of his statutory right to ques ommendation by the contracting offition the correctness of any administra cer for corrective action which should tive determination made hereunder be taken to increase competition in nor deprive any contractor of his right future procurements of the same or to have the matter determined by the similar items. Comptroller General should he so re (c) Award shall be made by mailing quest.

or otherwise furnishing to the success(h) Each agency shall maintain rec ful bidder a properly executed award ords of all administrative determina document or notice of award. When an tions made in accordance with this § 1- advance notice of award is issued, it 2.406-4, the facts involved, and the shall be followed as soon as possible by action taken in each case. A copy of the formal award. When more than the determination shall be attached to one award results from any single invieach copy of any contract rescission or tation for bids, separate award docureformation resulting therefrom.

ments shall be executed, each suitably (i) Where administrative determina- numbered. When an award is made to tion is precluded by the limitations set a bidder for less than all of the items forth in this section, the matter will which may be awarded to that bidder be submitted to the Comptroller Gen and additional items are being witheral for decision in accordance with held for subsequent award, the first agency procedures.

award to that bidder shall state that the Government may make subse- since these time intervals coincide quent awards on those additional with the discount terms generally ofitems within the bidder's bid accept- fered by industry. ance period. All provisions of the invi- (b) In determining which of several tation for bids, including any accept bids received is the lowest, any disable additions or changes made by a count offered shall be deducted from bidder in the bid, shall be clearly and the bid price on the assumption that accurately set forth (either expressly the discount will be taken, unless the or by reference) in the award docu discount offered is for a lesser period ment, since the award is an acceptance than the minimum number of days of the bid, and the bid and the award specified in the invitation for bids. constitute the contract.

(See $ 1-2.407-3(a).) In evaluating (40 FR 2811, Jan. 16, 1975)

equal bids offering discounts meeting

the minimum discount period required § 1-2.407-2 Responsible bidder-reason by the invitation, a bid offering a ableness of price.

longer discount period shall not be Before awarding the contract, the

considered as being more advantacontracting officer shall determine

geous to the Government. If a bid that a prospective contractor is re

offers a prompt payment discount, but sponsible (see Subpart 1-1.12) and

fails to specify the period in which the that the prices offered are reasonable.

discount may be taken, the discount The price analysis techniques set

may be considered since award to the forth in § 1-3.807-2(b)(1) may be used

bidder gives the Government the right as guidelines, where appropriate, but

to deduct the discount from any pay. determination in each case shall be

ment made with reasonable promptmade in the light of all prevailing cir

ness. cumstances. Particular care must be

(c) If a bid offers a prompt payment taken in cases where only a single bid

discount for a period less than that is received.

specified in the invitation for bids, the

discount shall not be considered in the [36 FR 17421, Aug. 31, 1971)

evaluation of bids. If a bid would have

been the lowest bid received if the dis§ 1-2.407-3 Discounts.

count offered were considered, but (a) Prior to issuing an invitation for award is not made thereon because the bids (except one for construction), a

offered discount cannot be considered, determination shall be made as to

a notation to that effect shall be made what minimum period for prompt pay

upon the abstract or record of bids ment discounts will be considered in

and on Standard Form 1036 (Statethe evaluation of bids and such mini

ment and Certificate of Award) if used mum period shall be stated in the invi

(see § 1-2.407-7). tation for bids. In determining the

(d) In any case, the offered discount minimum period for a particular pro of the successful bidder shall form a curement, consideration shall be given part of the award, whether or not to:

such discount was considered in the (1) The place of delivery, inspection,

evaluation of its bid, and such disand acceptance in relation to the place

count shall be taken if payment is of payment of invoices or vouchers.

made within the discount period. (2) The number of days required to process invoices or vouchers from re § 1-2.407-4 Price escalation. ceipt through payment in the normal

(a) Where an invitation for bids does course of business.

not contain a price escalation clause, (3) The need for prolonged accept

bids received which quote a price and ance testing or other unusual circum

contain a price escalation provision, stances tending to retard the normal

with a ceiling (usually expressed in processing of invoices or vouchers.

terms of a maximum percentage inGenerally, the minimum period will be crease) above which the price will not expressed in multiples of ten days; escalate, will be evaluated on the e.g., "ten calendar days," "twenty cal- maximum possible escalation of the endar days," or "thirty calendar days," quoted base price. Bids which contain

escalation with no ceiling shall be re- $ 1-2.407-6 Equal low bids. jected unless a clear basis for evalua

(a) In furtherance of the small busition exists.

ness and labor surplus area policies set (b) Where an invitation for bids con

forth in Subparts 1-1.7 and 1-1.8, tains a price escalation clause and no

award shall be made in accordance bidder takes exception to the escala

with the following order of priority tion provisions, bids shall be evaluated

when two or more low bids are equal on the basis of the quoted prices with

in all respects (taking into consideraout the allowable escalation being

tion cost of transportation, cash disadded. Where a bidder increases the counts, and any other factors properly maximum percentage of escalation

to be considered): stipulated in the invitation for bids or (1) Small business concerns which limits the downward escalation provi- are also labor surplus area concerns. sions of the invitation, the bid will be (2) Other small business concerns. rejected as nonresponsive. Where a (3) Other concerns which are also bidder deletes the escalation clause labor surplus area concerns. from its bid, the bid will be rejected as (4) Other concerns. nonresponsive since the downward es- (b) If the application of (a) of this calation provisions are thereby limit- $ 1-2.407-6 results in two or more bided. Where a bidder decreases the ders being eligible for award and such maximum percentage of escalation bidders are not small business constipulated in the invitation for bids, cerns, the award shall be made to the the bid shall be evaluated at the base bidder who will make the most extenprice on an equal basis with bids that sive use of small business subcontracdo not reduce the stipulated ceiling. tors. If two or more bidders still However, if after evaluation, the remain equally eligible for award, bidder offering the lower ceiling is in a award shall be made by a drawing by position to receive the award, the lot limited to such bidders. If time peraward shall reflect the lower ceiling. mits, the bidders involved shall be

given an opportunity to be present at § 1-2.407–5 Other factors to be considered. the drawing by lot. Such drawing shall The factors set forth in paragraphs

be witnessed by at least three persons,

and the contract file shall contain the (a) through (f), of this section, among

names and addresses of those witothers, may be for consideration in

nesses. evaluating bids for award.

(c) In each award where preference (a) Foreseeable costs or delays to the

is to be given under this section, the Government resulting from differ

contracting officer shall, prior to ences in inspection, location of sup

award, obtain from such concern a plies, transportation, etc.

written statement that it will perform, (b) Changes made or requested by

or cause to be performed, the contract the bidder in any of the provisions of in accordance with the circumstances the invitation for bids to the extent

justifying the priority. that any such change does not constitute ground for rejection of the bid

[29 FR 10141, July 24, 1964, as amended at

35 FR 8485, June 2, 1970; 43 FR 26011, June under the provisions of § 1-2.404.

16, 1978) (c) Advantages or disadvantages to the Government that might result $ 1-2.407-7 Statement and certificate of from making more than one award.

award. (d) Qualified products (see Subpart

(a) In connection with each contract 1-1.11).

made by formal advertising, the con(e) Local, State, and Federal taxes tracting officer shall include in the (see Part 1-11).

contract file evidence of compliance (f) Origin of supplies, whether do- with $ 1-2.103. Where required by mestic or foreign, and, if foreign, the agency procedures, Standard Form application of the Buy American Act 1036 (Statement and Certificate of or any other prohibition on foreign Award) may be used for this purpose. purchases (see Part 1-6).

Where the preparation of Standard

Form 1036 is not required, information with General Accounting Office Regu of a similar nature shall be filed with lations (4 CFR Part 20). the General Accounting Office copy of (2) Where a protest, before or afte the contract.

award, has been lodged with the Gen (b) The certificate shall either state eral Accounting Office (GAO) and thi that the accepted bid was the lowest contracting agency is requested to bid received, or list all lower bids and submit a report, such report should in set forth reasons for their rejection. clude: These reasons shall be set forth in (i) A copy of the protest; such detail as is necessary to justify (ii) A copy of the bid submitted by the award. For the purpose of this cer- the protesting bidder and a copy of tificate, the lowest bid received is con the bid of the bidder who is being con sidered to be that bid which is lowest sidered for award or who

sidered for award, or whose bid is after a consideration of price factors being protested: only. The cost of transportation to the (iii) A copy of the invitation for bids destination indicated in the invitation including the specifications or por for bids, any acceptable discount of tions thereof, relevant to the protest; fered by a bidder, and if the invitation (iv) A copy of the abstract of bids oi so specifies any other Government

relevant portions thereof; cost factor, shall be considered price (v) Any other documents which are factors in determining the lowest

relevant to the protest; and bidder for purposes of this certificate. (vi) A statement setting forth find In each case where an award is made

ings, actions, and recommendations in after receipt of equal low bids, the cer the matter together with any addition tificate shall set forth the manner in al evidence or information deemed which the tie was broken. Where an

necessary in determining the validity award involves a mistake in bid and

of the protest. The statement shall be the matter has been resolved by ad

fully responsive to the allegations of ministrative action, a copy of the bid

the protest. If the award was made der's verification in the case of an ap

after receipt of the protest, the report parent mistake, or the written admin

will include the determination re. istrative determination concerned,

quired in § 1-2.407-8(b)(4). shall be attached to the certificate.

(3) In appropriate cases, other perWhere an award involves a mistake in

sons, including bidders, involved in or bid on which the Comptroller General

affected by the protest shall be given has rendered a decision, the certificate

notice of the protest and the basis shall contain a citation by number and

therefor. They shall also be advised date of the decision and a copy thereof

that, if they wish, they may submit shall be attached to the certificate.

their views and relevant information [29 FR 10141, July 24, 1964, as amended at on the protest to the contracting offi40 FR 2812, Jan. 16, 1975)

cer within a specified period of time,

normally within 1 week. In addition, if § 1-2.407–8 Protects against award.

the protest has been lodged with (a) General. (1) Contracting officers GAO, they should be further advised shall consider all protests or objec- that copies of such submissions should tions regarding the award of a con- be furnished directly to GAO. tract, whether submitted before or (4) Timely action on protests is esafter award. If the protest is oral and sential to avoid undue delay in prothe matter cannot otherwise be re curements and to ensure fair treatsolved, written confirmation of the ment to protesting firms and individprotest shall be requested. The pro- uals. Accordingly, protests should be tester shall be notified in writing of handled on a priority basis. Upon rethe final decision on the written pro ceipt of informal advice that a protest test (see § 1-1.703-2 for protests re has been lodged with GAO, the congarding small business status). An in- tracting agency shall immediately terested party wishing to protest to begin compiling the information necthe Comptroller General of the essary for a report to GAO. This will United States against an award of a ensure that a report in response to a contract should do so in accordance formal request therefor will be for

warded to GAO as expeditiously as the need for readvertisement. In the possible. To further expedite process- event of failure to obtain such extenng. the official who furnishes the sion of bids, consideration should be gency's report to GAO should, upon given to proceeding with award under equest of the protester or GAO, si § 1-2.407-8(b)(4). multaneously furnish a complete copy (3) Where a protest has been lodged except for classified or privileged in with the procuring agency, the views ormation) to the protester and advise of GAO regarding the protest should JAO that this has been done. In such be obtained before award whenever nstances, the protester shall be re such action is considered to be desirjuested to furnish a copy of any com able. Where it is known that a protest nents on the administrative report di against the making of an award has ectly to GAO as well as to the con been lodged directly with GAO, a deracting agency.

termination to make award under $ 1(5) To facilitate the submission of 2.407-8(b)(4) must be approved at an eports to GAO, agencies shall furnish appropriate level above that of the jA0 with the name, title, and tele contracting officer, in accordance with hone number of one or more officials agency procedures. While award need in both field and headquarters of not be withheld pending final disposiices, if desired) which GAO may con

tion by GAO of a protest, a notice of act regarding protests. Each agency

intent to make award in such circumhall be responsible for promptly ad

stances shall be furnished GAO, and ising GAO of any change in such des

formal or informal advice should be mated officials. As a further means

obtained concerning the current status f expediting these submissions, agen

of the case prior to making the award. ies may provide for reports to be for

(4) Where a written protest against arded directly to GAO by the office

the making of an award is received, landling the contract without refer

award shall not be made until the nce to the headquarters office of the

matter is resolved, unless the contract

ing officer determines that: gency. (b) Protests before award. (1) If

(i) The items to be procured are urward has not been made, the con

gently required; or racting officer may require that writ

(ii) Delivery or performance will be en confirmation of an oral protest be

unduly delayed by failure to make ubmitted by a specified time and

award promptly; or nform the protester that award will

(iii) A prompt award will otherwise e withheld until the specified time. If

be advantageous to the Government. he written protest is not received by If award is made under paragraph he time specified, the oral protest (b)(4) (i), (ii), or (iii), of this section, nay be disregarded and award may be the contracting officer shall document iade in the normal manner unless the the file to explain the need for an imontracting officer, upon investigation, mediate award, and shall give written inds that remedial action is required, notice of the decision to proceed with 2 which event such action shall be the award to the protester and, as apaken.

propriate, to others concerned. (2) Pursuant to § 1-2.407-8(a)(3), (c) Protests after award. A protest otice of a protest and the basis there received after award shall be handled or may be given to bidders involved in in accordance with agency procedures. r affected thereby. In addition, when However, although persons involved in

protest against the making of an or affected by the filing of a protest ward is received and the contracting may be limited in instances where an fficer determines to withhold the award has been made, the contractor ward pending disposition of the pro- shall in any event be furnished with est, the bidders whose bids might the notice of protest and the basis jecome eligible for award should be therefor in accordance with $ 1-2.407equested, before expiration of the 8(a)(3). Also, when it appears likely ime for acceptance of their bids, to that an award may be invalidated and xtend the time for acceptance (with a delay in receiving the supplies or onsent of sureties, if any) to avoid services is not prejudicial to the Gov.

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