Protest alleging that the agency erred in rejecting a bid is dismissed. The agency rejected the protester’s bid due to a non-compliant bond. The agency relied on GAO cases, which hold that the type of bond the protester used was unacceptable. The protester argued the agency’s decision was unreasonable because GAO decisions are not binding, so the agency should not have relied on them. GAO reasoned that while its decisions are recommendations and not binding, that does not mean they are not authoritative or that an agency is free to ignore them. The agency reasonably relied on GAO caselaw in rejecting the protester’s bid.
Background
The Army Corps of Engineers issued an invitation for bids (IFB) for the removal of stone facing on a dam. The IFB required bidders to provide a bid guarantee—e.g., a bid bond supported by sufficient surety.
Leeward Construction Corporation submitted a bid with a bond form provided by the American Institute of Architects (AIA). The Corps found Leeward’s bid non-responsive because the AIA bond included limitations that differed from the requirements of the FAR. Specifically, the AIA bond did not cover reprocurement costs. Leeward protested.
Legal Analysis
- Leeward Disagreed with GAO Precedent – GAO noted that it had previously found that the AIA form used by Leeward are non-responsive. Leeward argued that because GAO decisions are not binding, the Corps unreasonably relied on them. GAO rejected this argument reasoning that while its decisions are non-binding recommendations, that does not mean GAO can cast them aside. GAO applies its own decisions to promote clarity and certainty for the procurement community. Ignoring prior decisions would be inconsistent with the purpose of GAO’s forum.
- Leeward Could Not Rely on Oral Advice of Agency Officials – Leeward alleged it reasonably relied on the oral advice of an agency who said the AIA bond would be acceptable. GAO did not believe the official had actually said the AIA bond would be acceptable. But even if an official had said the bond was acceptable, oral advice given by representatives of the government is not binding on the government. The bidder relied on oral explanations of the solicitation at its own risk.
- Agency Didn’t Abuse Its Discretion in Rejecting Leewards’ Bid – Leeward contended the Corps abused its discretion in rejecting Leeward’d bid because it resulted in award to a higher priced bidder. But an offeror is not allowed to correct its bond just because it would save the government money.
- No Disparate Treatment – Leeward claimed the Corps unequally assessed bidders because it allowed another bidder to correct a mistake in its price without allowing Leeward to correct a mistake with its bond. But the other bidder had quoted a unit price that was off by orders of magnitude; it was a clear clerical error. The FAR allows for the correction of clerical errors; it does not allow for corrections of a bond.
Leeward is represented by David A. Levine of McNees Wallace & Nurcik. The agency is represented by Katherine D. Denzel, Jason H. Shippy, and Scott C. Seufert of the Army. GAO attorneys Evan D. Wesser and Edward Goldstein participated in the preparation of the decision.
