B-163492, OCT. 11, 1968

B-163492, OCT. 11, 1968

TO GEORGIA ELECTRIC COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF AUGUST 16, 1968, REQUESTING RECONSIDERATION OF OUR DECISION, B-163492, OF AUGUST 6, 1968, WHICH DENIED YOUR FIRM'S PROTEST AGAINST THE REFUSAL OF THE GULF COAST ELECTRIC COOPERATIVE, INCORPORATED, TO OPEN AND CONSIDER YOUR LOW BID UPON FLORIDA 34 BAY ELECTRIC TRANSMISSION LINE CONSTRUCTION PROJECT.

BEFORE DISCUSSING THE PARTICULAR ISSUES YOU RAISE, WE THINK IT APPROPRIATE TO OUTLINE THIS OFFICE'S POSITION IN RELATION TO SUCH ENTITIES AS THE GULF COAST ELECTRIC COOPERATIVE, A PRIVATE CORPORATION, EXPENDING FUNDS BORROWED FROM THE FEDERAL GOVERNMENT UNDER THE RURAL ELECTRIFICATION ACT OF 1936, AS AMENDED. AS COMPARED TO THIS OFFICE'S AUTHORITY IN EXERCISING OVERSIGHT OVER DIRECT FEDERAL CONTRACTING, OUR AUTHORITY TO REVIEW PROCUREMENT ACTIONS OF PRIVATE PARTIES UTILIZING BORROWED FEDERAL FUNDS IS RELATIVELY LIMITED. AS YOU MAY BE AWARE, DIRECT PROCUREMENT BY FEDERAL AGENCIES IS CLOSELY CIRCUMSCRIBED BY A NUMBER OF STATUTES, DETAILED REGULATIONS AND FURTHER IMPLEMENTING DIRECTIVES. ON THE OTHER HAND, RURAL ELECTRIFICATION ADMINISTRATION (REA) BORROWERS NEED ONLY SATISFY THE MANDATES OF THEIR LOAN CONTRACT AND THE RELATIVELY BRIEF REA REGULATIONS IN POINT. IN TURN, THESE ARE INTERPRETED WITHIN THE CONTEXT OF A NUMBER OF COMPETITIVE PROCUREMENT SYSTEMS, FEDERAL AND STATE, AS CONSTRUED BY THE VARIOUS COURTS HAVING COGNIZANCE THEREOF. THIS FACTOR ADMITS MORE LEEWAY THAN THAT FOUND IN DIRECT FEDERAL PROCUREMENT, WHERE WE AND THE COURTS ATTEMPT TO UNIFORMLY INTERPRET THE SINGLE FEDERAL SYSTEM. FOR THIS REASON, OUR REVIEW OF THE COOPERATIVE'S ACTIONS IS NECESSARILY RESTRICTED TO SUCH BASIC CONCEPTS AS PROPER NOTICE, EQUALITY OF TREATMENT AND REASONABLENESS OF RESTRICTIONS.

WITH RESPECT TO THE PARTICULARS OF THIS CASE, YOU MAINTAIN THAT GEORGIA ELECTRIC WAS A QUALIFIED BIDDER UNDER THE TERMS OF THE SOLICITATION. BECAUSE OFFERORS WHO HAD PREVIOUSLY COMPLETED ELECTRIC LINE CONSTRUCTION WORK FOR REA BORROWERS WERE NOT REQUIRED TO FILE A BIDDER'S QUALIFICATIONS FORM IN ADVANCE OF BID OPENING, AS WE INTERPRETED THE PERTINENT PORTION OF THE SOLICITATION, YOUR FIRM'S PRIOR EXPERIENCE WAS IN ISSUE. THE COOPERATIVE REFUSED TO OPEN YOUR FIRM'S BID ON THE GROUNDS THAT YOU HAD FAILED TO COMPLY WITH THE SOLICITATION'S QUALIFICATION REQUIREMENTS BY EITHER FILING A FORM OR BY SUCCESSFULLY COMPLETING PRIOR ELECTRIC LINE CONSTRUCTION PROJECTS FOR REA BORROWERS. WHEN INFORMED OF YOUR STATEMENT THAT GEORGIA ELECTRIC HAD SUCCESSFULLY COMPLETED AN ELECTRIC LINE CONSTRUCTION PROJECT FOR A REA BORROWER IN CULLMAN, ALABAMA, WHICH WORK WOULD QUALIFY GEORGIA ELECTRIC'S BID FOR CONSIDERATION AS AN EXPERIENCED REA CONTRACTOR, THE MANAGER OF THE COOPERATIVE STATED THAT BECAUSE THE CULLMAN WORK HAD BEEN SUBCONTRACTED IN ITS ENTIRETY TO THE SOUTHERN ELECTRIC CONSTRUCTION COMPANY, THAT PROJECT COULD NOT BE ACCEPTED AS PROOF OF PRIOR WORK FOR A REA BORROWER.

YOU NOW ADVISE THAT ALTHOUGH GEORGIA ELECTRIC ATTEMPTED TO SUBCONTRACT THE WORK IN QUESTION TO SOUTHERN ELECTRIC CONSTRUCTION COMPANY, AS EVENTS TRANSPIRED GEORGIA ELECTRIC DID IN FACT CONSTRUCT THE ENTIRE PROJECT.

AS A PRACTICAL MATTER, WE HAVE NO REASON TO DOUBT YOUR PRESENT CONTENTION REGARDING WHICH FIRM ACTUALLY BUILT THE ELECTRIC LINE FOR THE CULLMAN, ALABAMA, REA BORROWER. HOWEVER, BECAUSE THE FLORIDA 34 BAY CONSTRUCTION PROJECT, WHICH WAS SCHEDULED FOR COMPLETION WITHIN 120 DAYS AFTER AWARD, IS NOW PROBABLY COMPLETED, THE QUESTION WHETHER GEORGIA ELECTRIC WAS A PROPERLY QUALIFIED BIDDER HAS BECOME ACADEMIC. NEVERTHELESS, YOU MAY STILL DESIRE SOME FURTHER EXPLANATION OF OUR PROCEDURES WHICH LED TO OUR ACCEPTANCE OF THE COOPERATIVE'S FACTUAL ASSERTIONS IN THE FIRST INSTANCE WITHOUT AN INDEPENDENT INVESTIGATION.

IN BID PROTEST DISPUTES, IT IS THE POLICY OF THIS OFFICE TO ACCEPT THE CONTRACTING AGENCY'S VERSION OF FACTUAL QUESTIONS IN THE ABSENCE OF COMPELLING EVIDENCE TO THE CONTRARY IN THE RECORD. 42 COMP. GEN. 124, 134. FOR PURPOSES OF THIS CASE, WE CONSIDERED THE COOPERATIVE AS IF IT WERE THE ADMINISTRATIVE AGENCY, BECAUSE IT, NOT THE LENDER ORGANIZATION, WAS THE PROCURING ACTIVITY. AT THE TIME OUR DECISION WAS PREPARED THE RECORD DID NOT CONTRADICT THE COOPERATIVE'S ASSERTION. AND BECAUSE THE CASE HAD BEEN DELAYED FOR MONTHS, WE CLOSED THE FILE AND RENDERED OUR DECISION UPON RECEIPT OF A STATEMENT FROM THE COOPERATIVE, RATHER THAN CARRYING THE MATTER FORWARD FOR ANOTHER ROUND OF CORRESPONDENCE. THIS TOO WAS IN ACCORDANCE WITH A LONG STANDING POLICY OF THIS OFFICE OF ATTEMPTING TO BRING BID PROTEST MATTERS TO AN EXPEDITIOUS CONCLUSION.

HOWEVER, EVEN IF THE MATTER HAD BEEN CARRIED FORWARD FOR A FURTHER EXAMINATION OF GEORGIA ELECTRIC'S PRIOR EXPERIENCE, THERE IS NO INDICATION THAT OUR ULTIMATE CONCLUSION WOULD HAVE BEEN ANY DIFFERENT, BECAUSE OF THE OTHER FACTORS PRESENT IN THE CASE WHICH INDICATED THAT THE CONTRACT WAS AWARDED ACCORDING TO PROPER PROCEDURES. IN THIS RESPECT, THE COOPERATIVE'S VERSION OF THE FACTS IN DISPUTE APPEARS TO HAVE SOME SUBSTANCE, IN THAT GEORGIA ELECTRIC DID ATTEMPT TO SUBCONTRACT THE WORK AT CULLMAN, ALABAMA, TO THE SOUTHERN ELECTRIC CONSTRUCTION COMPANY AS ALLEGED. THE COOPERATIVE'S STATEMENT THAT THE WORK IN QUESTION WAS SUBCONTRACTED CAN THEREFORE BE ASSUMED TO BE THE RESULT OF A GOOD FAITH MISCONCEPTION OF THE ACTUAL STATE OF AFFAIRS, RATHER THAN THE RESULT OF A DELIBERATE MISSTATEMENT.

YOU ALSO OBJECT TO THE DISTINCTION DRAWN BY THE COOPERATIVE BETWEEN AN OFFEROR'S PRIOR CONSTRUCTION WORK FOR REA BORROWERS UPON ELECTRIC TRANSMISSION LINES AND UPON ELECTRIC DISTRIBUTION LINES. WE HAVE BEEN ADVISED THAT THIS DISTINCTION CONFORMS WITH THE THEN CURRENT REA POLICY REGARDING QUALIFYING EXPERIENCE UNDER PARAGRAPH 7 OF REA FORM 831,"NOTICE AND INSTRUCTIONS TO BIDDERS". IT WAS REASONED THAT BECAUSE THIS FORM WAS INTENDED FOR USE ONLY IN CONJUNCTION WITH THE CONSTRUCTION OF ELECTRIC TRANSMISSION LINES, ONLY THAT PARTICULAR TYPE OF EXPERIENCE COULD BE ACCEPTED AS QUALIFYING WITHOUT PROOF OF COMPETENCE OTHERWISE.

AS A MATTER OF POLICY, WE AGREE WITH YOUR POSITION, THAT THE REQUIREMENT FOR PROOF OF ACCEPTABLE REA CONSTRUCTION EXPERIENCE NEED NOT BE SO NARROWLY CONSTRUED. WHEN THIS RESTRICTION WAS POINTED OUT TO THE REA OFFICIALS RESPONSIBLE FOR THE ADMINISTRATION OF THIS PROGRAM, WE WERE GIVEN TO UNDERSTAND THAT THIS PROBLEM, ALONG WITH CERTAIN OTHER TROUBLESOME ASPECTS OF THE QUALIFICATION CLAUSE, WOULD BE CLARIFIED IN THE NEXT REVISION OF THE SUBJECT FORM. THIS SHOULD PROVE A SOLUTION FOR THE FUTURE TO THE PROBLEMS WHICH BROUGHT ABOUT YOUR PROTEST.

WITH RESPECT TO YOUR BID ON FLORIDA 34 BAY, IT WAS TREATED CONSISTENTLY WITH THE THEN EFFECTIVE REA POLICY CONTROLLING THE EVALUATION OF BIDS UNDER THE REA DRAFTED PROCUREMENT FORMS. SINCE ALL OFFERORS WERE TREATED ALIKE, THE BASIC REQUIREMENT FOR TRUE COMPETITION, THAT ALL PARTIES BE AFFORDED AN EQUAL OPPORTUNITY TO OBTAIN A CONTRACT AWARD, HAS BEEN SATISFIED. WE HAVE CAREFULLY REVIEWED THE ENTIRE HISTORY OF THIS PROCUREMENT AND IT IS OUR CONCLUSION THAT THE REFUSAL OF THE GULF COAST ELECTRIC COOPERATIVE TO CONSIDER GEORGIA ELECTRIC'S BID WAS IN ACCORDANCE WITH THE APPLICABLE LAWS AND REGULATIONS. WE MUST, THEREFORE, ADHERE TO OUR PRIOR DECISION ON THE MATTER.