B-176352, OCT 5, 1972

B-176352: Oct 5, 1972

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO SOUTHWEST JETTRONIC CORP: REFERENCE IS MADE TO YOUR LETTER OF AUGUST 29. BIDS WERE SOLICITED FOR OPERATION. YOUR FIRM WAS THE PRIOR CONTRACTOR FOR THESE SERVICES UNDER CONTRACT NO. YOUR UNIT PRICE UNDER THIS CONTRACT WAS $8. P00001 AND P00002 WERE ISSUED CHANGING CERTAIN OF THE WORK REQUIREMENTS. THE CONTRACT PRICE WAS INCREASED TO $114. IT IS REPORTED THAT THE TIME FOR EXERCISE OF THE OPTION EXPIRED BEFORE THE NEXT YEAR'S NEEDS WERE FINAL. AS A RESULT IFB -0179 WAS ISSUED. WERE OPENED ON JUNE 30. THREE BIDS WERE RECEIVED AS FOLLOWS: BIDDER UNIT PRICE 1. 900.00 THE UNIT PRICES ARE BASED UPON ONE SERVICE MONTH OF A 12-MONTH CONTRACT. AWARD WAS MADE TO NIMONIC PRIOR TO RESOLUTION OF YOUR PROTEST ON THE BASIS OF AN URGENCY DETERMINATION PURSUANT TO ASPR 2 407.8(B)(3).

B-176352, OCT 5, 1972

BID PROTEST - SMALL BUSINESS SET-ASIDE - RESPONSIBILITY - OPTION DAMAGES DECISION DENYING THE PROTEST OF SOUTHWEST JETTRONIC CORPORATION AGAINST AWARD OF A CONTRACT TO ANY OTHER FIRM UNDER AN IFB ISSUED BY THE NAVAL AIR STATION, CORPUS CHRISTI, TEX., AS A 100 PERCENT SET-ASIDE FOR SMALL BUSINESS CONCERNS FOR OPERATION, MAINTENANCE AND REPAIR OF AIR CONDITIONING SYSTEMS AT THE ARMY AERONAUTICAL DEPOT MAINTENANCE CENTER, CORPUS CHRISTI, TEX. THE SBA FAVORABLE DETERMINATION OF CAPACITY AND CREDIT OF A PROSPECTIVE SMALL BUSINESS CONTRACTOR REQUIRES THE CONTRACTING OFFICER TO CONSIDER SUCH CONTRACTOR AS QUALIFIED FOR THE PROCUREMENT. THE GOVERNMENT'S FAILURE TO EXERCISE AN OPTION DOES NOT ENTITLE A CONTRACTOR TO DAMAGES.

TO SOUTHWEST JETTRONIC CORP:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 29, 1972, AND PRIOR CORRESPONDENCE, PROTESTING AGAINST THE AWARD OF A CONTRACT TO ANOTHER CONCERN UNDER INVITATION FOR BIDS NO. N00216-72-B-0179, A 100 PERCENT SET- ASIDE FOR SMALL BUSINESS CONCERNS, ISSUED ON JUNE 16, 1972, BY THE NAVAL AIR STATION, CORPUS CHRISTI, TEXAS. BIDS WERE SOLICITED FOR OPERATION, MAINTENANCE AND REPAIR OF AIR CONDITIONING SYSTEMS AT THE ARMY AERONAUTICAL DEPOT MAINTENANCE CENTER (ARAMAC), CORPUS CHRISTI, TEXAS.

YOUR FIRM WAS THE PRIOR CONTRACTOR FOR THESE SERVICES UNDER CONTRACT NO. N00216-71-C-0375, AWARDED ON JUNE 10, 1971, FOR A 12-MONTH PERIOD FOR THE MAINTENANCE AND OPERATIONS OF THE ARAMAC AIR CONDITIONING SYSTEMS BEGINNING JULY 1, 1971. YOUR UNIT PRICE UNDER THIS CONTRACT WAS $8,280 PER SERVICE MONTH FOR A TOTAL OF $99,360. SECTION J OF THAT CONTRACT GAVE THE GOVERNMENT AN OPTION TO RENEW FOR TWO ADDITIONAL YEARS. DURING THE COURSE OF THAT CONTRACT MODIFICATIONS NOS. P00001 AND P00002 WERE ISSUED CHANGING CERTAIN OF THE WORK REQUIREMENTS. AS A RESULT, THE CONTRACT PRICE WAS INCREASED TO $114,503.10.

BEFORE DECIDING ON HOW TO MEET THE FISCAL YEAR 1973 REQUIREMENTS FOR MAINTENANCE SERVICES, THE CONTRACTING OFFICER GAVE CONSIDERATION TO THE ALTERNATIVES OF EITHER EXERCISING THE OPTION UNDER THE EXISTING CONTRACT OR ISSUING A NEW SOLICITATION. HE DECIDED TO ISSUE A NEW SOLICITATION. IN THIS REGARD, IT IS REPORTED THAT THE TIME FOR EXERCISE OF THE OPTION EXPIRED BEFORE THE NEXT YEAR'S NEEDS WERE FINAL. IT ALSO APPEARS THAT IN ANY EVENT THE CONTRACTING OFFICER CONSIDERED IT IN THE GOVERNMENT'S BEST INTEREST TO ISSUE ANEW SOLICITATION RATHER THAN EXERCISE THE OPTION. AS A RESULT IFB -0179 WAS ISSUED.

BIDS UNDER IFB -0179, WERE OPENED ON JUNE 30, 1972, AND THREE BIDS WERE RECEIVED AS FOLLOWS:

BIDDER UNIT PRICE

1. SOUTHWEST JETTRONIC $10,306.50

2. FACILITIES MAINTENANCE, INC. 9,489.90

3. NIMONIC SERVICES 8,900.00

THE UNIT PRICES ARE BASED UPON ONE SERVICE MONTH OF A 12-MONTH CONTRACT. AWARD WAS MADE TO NIMONIC PRIOR TO RESOLUTION OF YOUR PROTEST ON THE BASIS OF AN URGENCY DETERMINATION PURSUANT TO ASPR 2 407.8(B)(3).

YOU HAVE PROTESTED AGAINST THIS AWARD AND HAVE MADE THE FOLLOWING CONTENTIONS:

(1) YOU ARE BEING PENALIZED AS A SMALL BUSINESS CONCERN AND THE DECISION TO ISSUE A NEW SOLICITATION WAS THE RESULT OF A PERSONAL DISLIKE OF YOUR FIRM BY THE PROCURING ACTIVITY;

(2) REALISTIC COMPETITION UNDER THE NEW SOLICITATION WAS NOT ACHIEVED IF ONE CONSIDERS THE QUALIFICATIONS OF FACILITIES MAINTENANCE AND NIMONIC SERVICES;

(3) THE GOVERNMENT'S FAILURE TO EXERCISE THE OPTION ENTITLES YOU TO DAMAGES.

WE NOTE THAT THE NEW SOLICITATION WAS A 100 PERCENT SMALL BUSINESS SET- ASIDE. WHILE YOU HAVE URGED THAT REALISTIC COMPETITION WAS NOT ACHIEVED UNDER THE NEW SOLICITATION BECAUSE OF THE QUALIFICATIONS OF THE TWO OTHER BIDDERS, THE FACT IS THAT THE LOW BIDDER, NIMONIC, WAS DETERMINED A RESPONSIBLE PROSPECTIVE CONTRACTOR PURSUANT TO APPLICABLE REGULATIONS. THE MATTER OF NIMONIC'S RESPONSIBILITY WAS REFERRED TO THE SMALL BUSINESS ADMINISTRATION PURSUANT TO ASPR 1-705.4 AFTER THE PREAWARD SURVEY TEAM HAD GIVEN NIMONIC A NEGATIVE RECOMMENDATION WITH RESPECT TO CAPACITY. AUGUST 14, 1972, THE CONTRACTING OFFICER WAS ADVISED THAT SBA HAD CERTIFIED THAT NIMONIC HAD THE CAPACITY AND CREDIT TO PERFORM A CONTRACT UNDER THE INSTANT SOLICITATION. IN VIEW OF THE STATUTORY MANDATE THAT PROCUREMENT OFFICERS MUST ACCEPT SBA DETERMINATIONS AS TO THE CAPACITY AND CREDIT OF PROSPECTIVE SMALL BUSINESS CONTRACTORS, THE CONTRACTING OFFICER WAS REQUIRED TO CONSIDER NIMONIC QUALIFIED FOR THE PROCUREMENT. SEE B- 168765, FEBRUARY 26, 1970, AND CASES CITED THEREIN.

ALTHOUGH IT APPEARS THAT THERE WAS SOME DISSATISFACTION WITH DISCHARGE OF YOUR FINANCIAL RESPONSIBILITY TO YOUR EMPLOYEES, WE DO NOT FIND THAT THE RECORD SUPPORTS YOUR CONTENTION THAT PERSONAL REASONS RATHER THAN THE REVISED REQUIREMENTS PROMPTED THE PROCURING ACTIVITY NOT TO EXERCISE THE OPTION IN YOUR CONTRACT. ALSO, THE FACT THAT THE SUBJECT SOLICITATION WAS A 100 PERCENT SMALL BUSINESS SET-ASIDE TENDS TO NEGATE YOUR CONTENTION THAT THE PROCURING ACTIVITY WAS ATTEMPTING TO PENALIZE YOU FOR BEING A SMALL BUSINESS CONCERN.

YOUR CLAIM FOR DAMAGES IS NECESSARILY PREDICATED ON A BREACH OF CONTRACT THEORY. HOWEVER, IT IS INHERENT IN AN OPTION CONTRACT THAT THERE IS NO OBLIGATION TO EXERCISE THE OPTION; THEREFORE, THERE IS NO BASIS TO SUPPORT YOUR POSITION THAT YOU ARE ENTITLED TO DAMAGES BECAUSE THE GOVERNMENT FAILED TO EXERCISE THE OPTION UNDER YOUR CONTRACT.

ACCORDINGLY, YOUR PROTEST IS DENIED.

Nov 22, 2017

Nov 21, 2017

  • A-P-T Research, Inc.
    We deny the protest in part and dismiss the protest in part.
    B-414825,B-414825.2

Nov 20, 2017

Nov 16, 2017

  • HBI-GF, JV
    We deny the protest.
    B-415036
  • Epsilon Systems Solutions, Inc.
    We dismiss the protest because it raises a matter of contract administration over which we do not exercise jurisdiction.
    B-414410.4

Nov 15, 2017

Looking for more? Browse all our products here