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B-166506 1 (1972-02-29)

handle is hein.gao/gaobabldh0001 and id is 1 raw text is: RESTRICTED Net t be rieased outsilde the eneraJ l 3 *Acoutr, Officao xci~p! 6-r tbe basliz of s~ific ro by the Othea of Congres.ial Re~iaton fj' COMPTROLLER GENERAL OF THE UNITED STA ISI WASHINGTON. D.C. 20548 C ou RELEASED B-166506 FB 291972 ' Dear Mr. Esch: By letter of October 15, 1971, you requested that we identify the person responsible for waiving the bid bond, and ascertain the reasons therefor,j'n connection with the con- tract for leasing the Air Pollution Laboratory, Ann Arbor, Michigant Dur review evidenced, however, that no formal or deliberatewaiver of the bid bond had occurred. In February 1969 the General Services Administration (GSA) delegated to the Department of Health, Education, and Welfare (HEW) the authority to enter into a contract for leas- ing space for an air pollution laboratory. Subsequently HEW requested GSA to advertise for the required space within a prescribed geographical area, solicit and review proposals, determine the financial capabilities of offerors, and make a recommendation to HEW. Of the 12 parties who expressed an interest in construct- ing a facility for lease to the Government, only two submitted offers in response to the advertised invitation for bid which contained a provision requiring a bid bond. Only one of the two offerors' bids included a bid bond. In considering the offers a determination had to be made that the offers were within the limitations imposed by sec- tion 322 of the Economy Act of 1932, as amended (40 U.S.C. 278a). The fair market value of the space to be leased and the fair annual rental thereof were appraised at $10,400,000 and $1,760,790, respectively. Under the Economy Act limita- tion, the annual rental could not exceed 15 percent of the fair market value of the space to be leased. According to this criteria the annual rental limitation was $1,560,000. The records indicate that the lease was awarded to the offeror who had not furnished a bid bond principally because: 1. His annual rental bid of $1,529,500 (later increased to $1,535,000) was about $338,000 less than the $1,868,000 bid of the unsuccessful offeror.

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