Based upon all the attendant factors mentioned above, it is our view that your bid properly was considered by the contracting agency as being nonresponsive. The decisions of our Office are uniform in holding that public officers may not accept bids not complying in substance with the advertised specifications. 34 Comp. Gen. 82. In the present case, your proposal to provide only approximately 30 percent or less of the required amount of storage space in the housing units and to furnish plywood not specifically related to the requirements of the specifications constituted material deviations which went to the quality of the structures to be provided and, as such, could not be waived by the contracting officer. 30 Comp. Gen. 179; 33 id. 441. Regarding the substantial deficiency in storage space which you proposed to furnish, and having reference to your note above mentioned, the Secretary of the Air Force, in his report on the matter of your protest, makes the following statements with which we are fully in accord:

The expression "reasonable" might reserve to the bidder the option of determining whether a proposal by the Government to remedy the defect was acceptable. Furthermore, it would appear that substituting general words of promise for detailed plans, meeting the specifications, would be at variance with Article 18 of the additional instructions to bidders. To the extent that redesign of the floor plan would be necessary to rectify the large deficiency in floor space, the Government would be deprived of the opportunity of effectively evaluating the detailed plans required of the bidders.

With reference to your letter in which you offered to furnish beveled cedar siding in accordance with the specifications, such offer, having been received after the opening of bids, cannot properly be given any consideration. In numerous decisions our Office has held that to permit bidders to vary their proposals after the bids are opened would soon reduce to a farce the whole procedure of letting public contracts on an open competitive basis. In support of this position, attention is invited to the case of City of Chicago v. Mohr, 216 Ill. 320; 74 N. E. 1056, wherein the court stated as follows:

where a bid is permitted to be changed [after the opening] it is no longer the sealed bid submitted in the first instance, and, to say the least, is favoritism, if not fraud-a direct violation of law-and cannot be too strongly condemned.

In the instant case your bid and that of the Fred J. Early, Jr., Company were rejected on the basis of an administrative determination, pursuant to applicable procurement instructions, that they were nonresponsive. Bona fide determinations as to responsiveness of bids and responsibility of bidders are matters primarily for administrative determination and may be questioned only where they are not supported by substantial evidence. We find no lack of such evidence in this instance.

With respect to your apparent contention that cancellation of the invitation was improper until bids had been formally rejected, and

that the grounds now stated as justification for rejection of your bid were belatedly advanced to support the effort of the Air Force to "change horses," the record shows that the defects in your bid were determined by the evaluating officers on December 20, 1957, and that the cancellation of the invitation was based upon the finding that there was no responsive and acceptable bid available. Since such cancellation is automatically a rejection of all bids, the issuance of a formal rejection to each bidder would obviously be a useless gesture.

In the circumstances, it must be concluded that your protest furnishes no proper basis on which we would be justified in holding that the action of the contracting officer in rejecting the two bids and canceling the invitation was illegal or improper.

[B-135865]

Bids-Discarding All Bids-Progress Payment Exclusion The rejection of all bids, three of which contained requests for progress pay. ments, and the readvertisement of the procurement under an invitation which specifically authorized bidders to request progress payments and which resulted in increasing competition may be considered a proper exercise of administrative authority under 10 U. S. C. 2305 (b) which permits rejection if the head of the agency determines that rejection is in the public interest.

To Beigel & Mahrt, May 14, 1958:

Reference is made to your telegrams of April 16 and April 28, 1958, and letters of April 17 and April 28, 1958, with enclosure, protesting the cancellation by the Department of the Air Force of invitation for bids No. 14-604-58-393, pursuant to which your client, Henry Spen & Co., submitted the low bid.

The invitation was issued on November 20, 1957, by the Topeka Air Force Depot for the procurement of "spray outfits." Bids were opened on December 27, 1957. The low bidder, the Spen Company, had included with its bid a letter specifically made a part thereof in which it was stated:

We therefore request progress payments of cost incurred type on this procurement.

Since the invitation contained no provision with regard to progress payments, the Spen bid was considered nonresponsive. Subsequently, it was determined by the Department of the Air Force to reject all bids, withdraw the invitation and to readvertise the procurement under a new invitation for bids, No. 14-604-58-789, issued March 31, 1958. Bids were opened on April 15, 1958, and award was made to the Greer Hydraulic & Engineering Company, the low bidder.

In a brief enclosed with the letter of April 28, you contend, on behalf of the Spen Company, that the request for progress payments appended to the bid did not constitute a material qualification which would require or permit its rejection because (1) instances of similar language employed with regard to other invitations not providing for progress payments have been considered minor irregularities only and have been waived by the contracting officers concerned; (2) the statement in the Spen bid is a mere precatory expression which should not be regarded as conditioning the bid; (3) the request for progress payments did not go to the price, quantity or quality of the contract and therefore could be waived by the Air Force.

The arguments presented in the brief presuppose the issue to be whether, because of the progress payment request, the Spen Company bid could have been rejected and the award made to another bidder under the same invitation. However, since the invitation was canceled, which in effect means that all bids were rejected, it appears that the real issue for resolution is whether, under the facts and circumstances, the Department of the Air Force had the authority to withdraw the invitation and readvertise the procurement.

Title 10 of the United States Code provides at section 2305 (b) that "all bids may be rejected if the head of the agency determines that rejection is in the public interest." Further, it has consistently been held that an invitation for bids does not import any obligation to accept any of the offers received and all bids may be rejected where it is determined to be in the public interest to do so. See O'Brien v. Carney, 6 F. Supp. 761; Scott v. United States, 44 C. Cls. 524; Colorado Paving Company v. Murphy, 78 F. 28. Notwithstanding this broad authority, it has been recognized that the rejection of all bids without abandonment of the procurement tends to discourage competition and since this result is contrary to one of the chief purposes for which the statutes governing public procurement were enactedobtaining for the Government the benefits flowing from free and unrestricted competition-we have held that the authority to reject all bids must be exercised with care and only upon a bona fide determination that the public interest would thereby be served. 37 Comp. Gen. 12 and 34 Comp. Gen. 535.

The only provision with regard to payments contained in the initial invitation is found in section 7 of the General Provisions which states:

The Contractor shall be paid, upon the submission of properly certified invoices or vouchers, the prices stipulated herein for supplies delivered and accepted or services rendered and accepted, less deductions, if any, as herein provided. Unless otherwise specified, payment will be made on partial deliveries accepted by the Government when the amount due on such deliveries so warrants; or, when requested by the Contractor, payment for accepted partial

deliveries shall be made whenever such payment would equal or exceed either $1,000 or 50 percent of the total amount of this contract.

The quoted provision does not provide for progress payments. Department of Defense Directive No. 7800.4, November 16, 1956, provides:

III C. Requests for proposals and invitations for bids shall specify that the need for advance or progress payments conforming to regulations will not be considered a handicap or adverse factor in the award of contracts *

III D. Whenever, incident to formal advertising, the Contracting Officer considers (1) that the period between the beginning of work and the required first production delivery will exceed six months, or (2) that progress payments will be useful or necessary by reason of unusual circumstances that will involve substantial accumulation of predelivery costs that may have a material impact on a contractor's working funds (including but not limited to substantial small business set-asides expected to involve a relatively large predelivery accumulation of materials, purchased parts or components) the invitations for bids shall state that upon written request by the prospective contractor a progress payment clause to be included in the invitations for bids or identified by appropriate reference therein, * * * will be included in the contract at the time of award. These invitations for bids providing for progress payments shall also state that bids including requests for progress payments will be evaluated on an equal basis with those not including requests for progress payments. [Italics supplied.]

Substantially similar language is contained in AFR. 173–133.

It is apparent from the foregoing quotation that progress payments are to be provided for in a contract awarded pursuant to formal advertising when certain determinations are made by the contracting officer and in such cases the invitation shall specify that progress payments may be obtained by the successful bidder and requested by any bidder without affecting the evaluation of his bid.

Of the ten bids received in response to the first invitation, three, including that of the Spen Company, contained a request for progress payments. In view of this, it is reasonable to assume that had provision for progress payments been included in the invitation for bids pursuant to Department of Defense Directive No. 7800.4, more bids might have been received and the possibility of avoiding any necessity for borrowing working funds could have encouraged the submission of lower prices. Indeed, the relatively small amount of the low bid received pursuant to the second invitation would tend to establish the accuracy of the latter statement. Since the withdrawal of the first invitation and the readvertisement of the procurement under an invitation specifically authorizing bidders to request progress payments appear to have been a means of increasing competition we cannot say that such action was not a proper exercise of authority under 10 U. S. C. 2305 (b). See B-132730, August 14, 1957.

Your contention that other requests for progress payments have not resulted in the rejection of bids submitted pursuant to invitations which did not contain any provision with regard to such payments need not be considered at this time since, even assuming that the

factual situations are analogous, they appear to concern not the authority to reject all bids and readvertise, but whether under the circumstances such bids may be considered for award, a matter not here at issue.

In accordance with the foregoing, we perceive no legal objection to the action taken by the Department of the Air Force.

Contracts

[B-135160]

Specifications — Descriptive Data-Alternate

Evaluation Bases

A descriptive literature submission requirement in an invitation which speciflcally provides that noncompliance with the requirement would result in rejection is a substantive requirement which cannot be waived for one bidder after opening without prejudicing the rights of other bidders.

The word "failure" in an invitation provision which requires rejection of bids for failure to furnish descriptive literature connotes an omission to furnish the material rather than a failure of the descriptive literature to comply with the specifications.

An election on the part of a bidder to submit his bid on a descriptive literature basis rather than on the alternative basis of previous procurement precludes the contracting agency from making an evaluation on the basis of previous procurement.

Previous production information submitted by a bidder with the required descriptive literature pursuant to an invitation which required bidders to include with the descriptive literature “general experience and background on similar projects" and which also permitted them to submit similar procurement production experience as an alternative to the submission of descriptive literature is for consideration as part and parcel of the descriptive literature rather than as an alternative evaluation election.

Informalities and minor irregularities in bids which may be waived by contracting officers are those of form and not of substance, or of some immaterial and inconsequential defect in or variation of a bid from the exact requirement of the invitation.

A bidder who submits descriptive literature, which does not conform to the specifications, and also information that he had previously furnished similar (but not identical) articles as a subcontractor under a procurement which was not in complete conformance with the current specifications may not have the mandatory descriptive literature requirement waived nor the bid considered for award on the basis of specification variations without prejudice to the rights of other bidders.

To Wilmer & Brown, May 15, 1958:

Reference is made to your brief submitted on April 23, 1957, urging, on behalf of Keco Industries, Inc., reconsideration of our decision B-135160, March 31, 1958, 37 Comp. Gen. 645, to the Secretary of the Air Force, which held that the bid of your client must be rejected and not considered for award under invitation for bids No. 01-60858-1, issued by the Gadsden Air Force Depot, Gadsden, Alabama.