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B-233041.3 1 (1989-10-20)

handle is hein.gao/gaobadnpw0001 and id is 1 raw text is: S aN Comptroller General of the United States Washington, D.C. 20548 Decision Matter of: United States Coast Guard--Request for Advance Decision File: B-233041.3 Date: October 20, 1989 DIGEST Although contracting agency improperly allowed upward correction of bid to include additional profit, bond costs and insurance costs when the costs were not adequately substantiated, there is no evidence of fraud, bad faith or mutual mistake, the resulting contract was not plainly or palpably illegal, and the contractor may be paid at the contract price where the agency determines that it is not in the government's best interest to terminate the contract. DECISION A United States Coast Guard disbursing officer has requested an advance decision regarding the propriety of using funds appropriated to the Coast Guard to pay for work completed under a contract that we have previously found was awarded at an overstated contract price. For the reasons given below, we conclude that the contractor may be paid at the contract price for work satisfactorily completed. This matter arises out of our decision in Lash Corp., 68 Comp. Gen. 232 (1989), 89-1 CPD 120. In that decision, we denied Lash's protest against the Coast Guard's determi- nation to permit upward correction of the bid submitted by Construction and Rigging, Inc. (CRI), in response to invitation for bids No. DTCG50-88-B-65023, for repair of a fuel pier at the Coast Guard Support Center in Kodiak, Alaska. Although we denied the protest, we found that the $47,393 CRI claimed for additional profit, bond costs and insurance costs was not adequately substantiated and that the contract price thus should not have included this additional amount. The Coast Guard considered terminating CRI's contract for the convenience of the government based on the overstated contract price, but informs us that it has concluded that ,//( 1

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