B-139366, JUNE 24, 1959, 38 COMP. GEN. 864

B-139366, JUNE 24, 1959, 38 COMP. GEN. 864

CONTRACTS - SMALL BUSINESS - CERTIFICATES OF COMPETENCY THE TERM "CAPACITY" IN SECTION 8 (B) (7) OF THE SMALL BUSINESS ACT OF 1958, 15 U.S.C. 637 (B) (7), REFERS TO THE OVER-ALL ABILITY OF A PROSPECTIVE SMALL BUSINESS CONTRACTOR TO MEET QUALITY, QUANTITY, AND TIME REQUIREMENTS OF A PROCUREMENT; HENCE, WHEN THE SMALL BUSINESS ADMINISTRATION ISSUED A CERTIFICATE OF COMPETENCY, IT IS CONCLUSIVE UPON A PROCUREMENT AGENCY AS TO ELEMENTS OF RESPONSIBILITY RELATING TO THE CONTRACTOR'S ABILITY TO PERFORM, EXPERIENCE, SKILL,"KNOW HOW," TECHNICAL KNOWLEDGE, ETC.

TO THE SECRETARY OF THE ARMY, JUNE 24, 1959:

REFERENCE IS MADE TO A LETTER DATED JUNE 9, 1959, WITH ENCLOSURE, FROM THE ASSISTANT SECRETARY OF THE ARMY ( LOGISTICS), FURNISHING THE REPORT REQUESTED BY OUR OFFICE BY LETTER OF APRIL 27, 1959, IN CONNECTION WITH THE PROTEST OF AMECO ELECTRONIC CORPORATION AGAINST THE AWARD OF A CONTRACT TO ANY BIDDER OTHER THAN ITSELF UNDER INVITATION FOR BIDS NO. SC- 36-039-59-1651-A3, ISSUED ON JANUARY 14, 1959, BY THE SIGNAL SUPPLY AGENCY.

THE INVITATION REQUESTED BIDS, UNDER A SMALL BUSINESS SET ASIDE, FOR THE FURNISHING OF A QUANTITY OF FREQUENCY METERS (AN/URM-80) RANGING FROM 262 TO 1150 EACH. IN RESPONSE THERETO, BIDS WERE RECEIVED FROM SIX PROSPECTIVE CONTRACTORS. UPON THE OPENING OF BIDS ON FEBRUARY 10, 1959, THE LOWEST APPARENT BID IN THE NET TOTAL AMOUNT OF $509,821 WAS SUBMITTED BY AMECO. THE LAVOIE LABORATORIES, INC., SUBMITTED THE NEXT LOWEST NET TOTAL BID IN THE AMOUNT OF $514,639. SINCE AMECO WAS CONSIDERED DELINQUENT BY THE CONTRACTING OFFICER IN THE PERFORMANCE OF A CURRENT CONTRACT ( NO. DA-36-039-SC-74669) FOR 287 AN/URM-80 FREQUENCY METERS, AMECO'S BID WAS SUBMITTED TO THE CONTRACTOR EVALUATION BOARD OF THE SIGNAL SUPPLY AGENCY ON FEBRUARY 18, 1959, FOR A PREAWARD QUALIFICATION DETERMINATION. ON MARCH 11, 1959, THE BOARD DETERMINED THAT AMECO WAS NOT RESPONSIBLE DUE TO DEFICIENCIES IN PAST PERFORMANCE, TECHNICAL ABILITY AND FINANCES, INCLUDING A LACK OF "KNOW HOW.' THE CONTRACTING OFFICER CONCURRED IN THIS DETERMINATION OF NONRESPONSIBILITY.

PURSUANT TO THE PROVISIONS OF SECTION 1-705.6 OF THE ARMED SERVICES PROCUREMENT REGULATION, AND SINCE THE CONTRACTING OFFICER REPORTED THAT HE COULD NOT DISPROVE THE POSSIBILITY THAT AMECO'S POOR PAST PERFORMANCE WAS DUE TO ITS LACK OF TECHNICAL ABILITY AND FINANCIAL RESOURCES, THE LOW BID OF AMECO WAS SUBMITTED TO THE SMALL BUSINESS ADMINISTRATION ( SBA) ON MARCH 12, 1959, FOR CONSIDERATION AS TO WHETHER A CERTIFICATE OF COMPETENCY SHOULD BE ISSUED TO AMECO. SBA ISSUED A CERTIFICATE OF COMPETENCY TO AMECO ON MARCH 27, 1959. AS THE RESULT OF AN INFORMAL MEETING WITH REPRESENTATIVES OF SBA AND THE PROCUREMENT AGENCY ON APRIL 6, 1959, THE CERTIFICATE WAS REVIEWED AND RECONSIDERED BY SBA. THE CERTIFICATE WAS REAFFIRMED BY SBA AND THE CONTRACTING OFFICER WAS SO ADVISED ON APRIL 15, 1959. HOWEVER, IT IS THE OPINION OF THE DEPARTMENT OF THE ARMY THAT THE CERTIFICATE OF COMPETENCY ISSUED BY SBA TO AMECO IS NOT CONCLUSIVE UPON THE CONTRACTING OFFICER SINCE SUCH ELEMENTS OF RESPONSIBILITY AS EXPERIENCE, SKILL,"KNOW HOW," TECHNICAL KNOWLEDGE, QUALITY OF PRODUCTION, QUALITY OF PERSONNEL, JUDGMENT AND SOUND BUSINESS MANAGEMENT OF A PROSPECTIVE CONTRACTOR ARE NOT WITHIN THE PURVIEW OF THE CERTIFICATE OF COMPETENCY. THAT IS TO SAY, THE DEPARTMENT VIEWS THE CERTIFICATE AS GOING ONLY TO THE CREDIT AND THE PHYSICAL CAPACITY OF A PROSPECTIVE CONTRACTOR TO PERFORM.

SECTION 8 (B) (7) OF PUBLIC LAW 85-536, APPROVED JULY 18, 1958, 15 U.S.C. 637 (B) (7), EMPOWERS THE SBA:

(7) TO CERTIFY TO GOVERNMENT PROCUREMENT OFFICERS, * * *, WITH RESPECT TO THE COMPETENCY, AS TO CAPACITY AND CREDIT, OF ANY SMALL BUSINESS CONCERN * * * TO PERFORM A SPECIFIC GOVERNMENT CONTRACT. IN ANY CASE IN WHICH A SMALL-BUSINESS CONCERN * * * HAS BEEN CERTIFIED BY OR UNDER THE AUTHORITY OF THE ADMINISTRATION TO BE A COMPETENT GOVERNMENT CONTRACTOR WITH RESPECT TO CAPACITY AND CREDIT AS TO A SPECIFIC GOVERNMENT CONTRACT, THE OFFICERS OF THE GOVERNMENT HAVING PROCUREMENT * * * POWERS ARE DIRECTED TO ACCEPT SUCH CERTIFICATION AS CONCLUSIVE, AND ARE AUTHORIZED TO LET SUCH GOVERNMENT CONTRACT TO SUCH CONCERN * * * WITHOUT REQUIRING IT TO MEET ANY OTHER REQUIREMENT WITH RESPECT TO CAPACITY AND CREDIT; * * * ( ITALICS SUPPLIED)

IN SUPPORT OF THE DEPARTMENT'S OPINION, IT IS CONTENDED THAT AN INTERPRETATION OF THE TERM ,CAPACITY" AS USED IN THE ABOVE-QUOTED PROVISION TO INCLUDE ALL ELEMENTS OF RESPONSIBILITY SET FORTH IN SECTION 1.903.1 OF THE ASPR NOT ONLY WOULD BE IN CONFLICT WITH 10 U.S.C. 2305 (C) AND PRIOR DECISIONS OF OUR OFFICE BUT IF ALLOWED TO PREVAIL COULD IMPAIR THE ABILITY OF THE MILITARY DEPARTMENTS TO PROPERLY PERFORM THEIR MISSION OF SAFEGUARDING THE NATIONAL SECURITY. IN THAT CONNECTION, REFERENCE IS MADE TO THE LEGISLATIVE HISTORY OF THE ARMED SERVICES PROCUREMENT ACT OF 1947, 10 U.S.C. 2301, WHEREIN THE COGNIZABLE COMMITTEES OF THE CONGRESS INDICATED THAT THE PROCUREMENT AGENCIES ARE BEST QUALIFIED TO EVALUATE WHETHER A BIDDER IS A "RESPONSIBLE BIDDER" ON THE BASIS OF HIS EXPERIENCE, SIZE, TECHNICAL ORGANIZATION, REPUTATION, FINANCIAL RESOURCES, AND OTHER FACTORS. IT IS, THEREFORE CONCLUDED THAT SUCH LEGISLATIVE HISTORY IS A CLEAR INDICATION THAT THE TERM "RESPONSIBLE BIDDER" WAS MEANT TO ENCOMPASS MORE THAN MERE "CAPACITY.' IT IS FURTHER CONTENDED THAT SUCH VIEW IS IN ACCORD WITH DECISIONS OF OUR OFFICE WHEREIN IT WAS HELD THAT PROCUREMENT OFFICERS ARE REQUIRED TO CONSIDER NOT ONLY THE FINANCIAL RESOURCES OF A BIDDER BUT ALSO JUDGMENT, SKILL, INTEGRITY, FITNESS, CAPACITY, AND ABILITY, CITING 26 COMP. GEN. 676; 30 ID. 235; 33 ID. 549; 34 ID. 86.

IN PARTICULAR, ATTENTION IS DIRECTED TO THE DECISION REPORTED AT 37 COMP. GEN. 676, WHICH HELD, IN EFFECT, THAT A CERTIFICATE OF COMPETENCY IS NOT DETERMINATIVE WHERE A BIDDER IS FOUND NOT TO BE QUALIFIED FOR REASONS OTHER THAN CAPACITY AND CREDIT AS, FOR EXAMPLE, LACK OF INTEGRITY OR A CONSISTENT RECORD OF DEFAULT, AND TO THE DECISION OF FEBRUARY 24, 1959, B- 138233, WHEREIN IT WAS HELD THAT A BIDDER'S DEFICIENCIES IN THE AREA OF BUSINESS PRACTICES ARE NOT SUBJECT TO CERTIFICATION OF COMPETENCY BY SBA.

WE DO NOT BELIEVE THAT IT IS APPROPRIATE OR NECESSARY TO DISCUSS OR ATTEMPT TO RESOLVE THE CONFLICT BETWEEN THE DEPARTMENT'S DETERMINATION THAT AMECO IS NOT A RESPONSIBLE BIDDER AND THE DETERMINATION MADE BY THE SBA AS EVIDENCED BY THE CERTIFICATE OF COMPETENCY ISSUED TO AMECO. THE ONLY QUESTION INVOLVED HERE IS WHETHER THE TERM "CAPACITY" AS USED IN SECTION 8 (B) (7) OF THE SMALL BUSINESS ACT INCLUDES ALL THOSE ELEMENTS OF RESPONSIBILITY RELATING TO THE OVER-ALL TECHNICAL ABILITY OF A PROSPECTIVE BIDDER TO PRODUCE THE END-ITEM CALLED FOR BY THE INVITATION FOR BIDS.

AS STATED ON PAGE 2 OF THE REPORT FROM YOUR DEPARTMENT, THE CONGRESS INTENDED BY ENACTING THE ARMED SERVICES PROCUREMENT ACT OF 1947 TO ENCOURAGE THE EXERCISE OF JUDGMENT BY CONTRACTING OFFICERS TO DETERMINE THE RESPONSIBILITY OF PROSPECTIVE CONTRACTORS THROUGH AN EVALUATION OF THEIR EXPERIENCE, SIZE, TECHNICAL ORGANIZATION, REPUTATION, FINANCIAL RESOURCES, AND OTHER FACTORS. THE OBLIGATION AND RIGHT OF CONTRACTING OFFICERS TO EXERCISE THIS DISCRETIONARY AUTHORITY LONG HAS BEEN RECOGNIZED BY THE COURTS AND OUR OFFICE. SEE 27 ALR 2D 906 AND ANNOTATIONS COLLECTED UNDER NOTE 5 THEREOF; UNITED STATES WOOD PRESERVING COMPANY V. SUNDMAKER, 186 F. 678; 37 COMP. GEN. 430; 36 ID. 42; 30 ID. 235. WHILE THE 1947 ACT, NOW CODIFIED IN 10 U.S.C. 2301, ET SEQ., VESTED IN THE CONTRACTING OFFICER THE ENTIRE RESPONSIBILITY TO DETERMINE THE QUALIFICATIONS OF PROSPECTIVE CONTRACTORS, THE LATER ENACTMENTS OF SMALL BUSINESS LEGISLATION CULMINATING IN THE ENACTMENT OF THE SMALL BUSINESS ACT, PUBLIC LAW 85-536, 15 U.S.C. 631 NOTE, LIMITED THAT DISCRETIONARY AUTHORITY WITH RESPECT TO THE COMPETENCY, AS TO CAPACITY AND CREDIT, OF A SMALL BUSINESS CONCERN COMPETING FOR A GOVERNMENT CONTRACT. CERTAINLY THERE CAN BE NO QUESTION THAT THE OBLIGATION OR AUTHORITY OF A CONTRACTING OFFICER TO DETERMINE THE FINANCIAL RESOURCES OF A SMALL BUSINESS BIDDER DOES NOT EXIST WHERE A CERTIFICATE OF COMPETENCY HAS BEEN ISSUED TO SUCH BIDDER.

THE WORD "CAPACITY" AS USED IN SECTION 8 (B) (7) OF PUBLIC LAW 85 536 IS NOT DEFINED THEREIN NOR IS ANY LIGHT SHED UPON ITS INTENDED MEANING BY THE LEGISLATIVE HISTORY OF THAT ACT. IT IS DEFINED BY STANDARD DICTIONARIES AS "LEGAL QUALIFICATION," "COMPETENCY," "POWER, OR FITNESS.' THE TERM ALSO HAS BEEN DEFINED AS SYNONYMOUS WITH "ABILITY.' THE CONGRESS FIRST RECOGNIZED THE NEED FOR GOVERNMENT ASSISTANCE TO SMALL BUSINESS AT THE BEGINNING OF WORLD WAR II. IN THE SENATE HEARINGS BEFORE THE COMMITTEE ON BANKING AND CURRENCY ON S. 2250, 77TH CONGRESS, SECOND SESSION, SENATOR JAMES E. MURRAY, THEN CHAIRMAN OF THE SENATE SMALL BUSINESS COMMITTEE, TESTIFIED AS FOLLOWS ON PAGE 11:

SENATOR MURRAY. WELL, OF COURSE, THIS DIVISION OF SMALL BUSINESS PRODUCTION THAT WOULD BE SET UP IN THE WAR PRODUCTION BOARD WOULD MAKE A STUDY OF THE PARTICULAR PLANT, ITS TOOLS, AND ITS CAPACITY, AND WOULD BE ABLE TO DETERMINE WHETHER OR NOT IT COULD PARTICIPATE IN WAR PRODUCTION; AND, HAVING DETERMINED THAT IT COULD--- AND OF COURSE IT WOULD BE ADVISED BY EXPERT ENGINEERS AND TECHNICAL EXPERTS--- AND IF IT WAS FOUND THAT IT WAS CAPABLE OF MANUFACTURING THINGS FOR WAR PURPOSES THEN THAT DIVISION WOULD CERTIFY THAT PLANT AS COMPETENT WITH THEM. ALSO, IF IT WAS FOUND, AFTER THAT DIVISION HAD MADE AN EXAMINATION AND INVESTIGATION OF THE PLANT, THAT IT REQUIRED A CERTAIN AMOUNT OF NECESSARY FINANCING IN ORDER TO ENABLE IT TO GET THE NECESSARY TOOLS TO PERFECT ITS PLANT SO AS TO TAKE WAR CONTRACTS, IT WOULD BE ENTITLED TO A LOAN FOR THAT PURPOSE WHICH THE LOANING DIVISION WOULD BE DIRECTED TO EXTEND.

SENATOR RADCLIFFE. WOULD THE DISCRETION BE ENTIRELY IN THE DIVISION OF SMALL BUSINESS PRODUCTION--- BECAUSE THE LANGUAGE OF THE LAST PART OF THE SECTION STATES THAT THEY SHALL BE ,AUTHORIZED TO LET GOVERNMENT PROCUREMENT CONTRACTS TO SUCH CONCERN WITHOUT REQUIRING IT TO MEET ANY OTHER REQUIREMENTS WITH RESPECT TO CAPACITY OR CREDIT.'

SENATOR MURRAY. WELL, WITH RESPECT TO CAPACITY OR CREDIT.

SENATOR RADCLIFFE. CAPACITY OR CREDIT.

SENATOR MURRAY. THAT IS TO SAY, IF THE INVESTIGATION SHOWED IT HAD THE MACHINERY THERE TO TURN OUT A CONTRACT, WHY, THOSE PROCUREMENT OFFICERS SHOULD NOT REJECT IT AND REFUSE A CONTRACT MERELY BECAUSE IT DID NOT HAVE A CREDIT STANDING, AND SO FORTH; THIS BOARD WOULD DETERMINE WHETHER IT HAD THE CAPACITY AND THE CREDIT, AND WHEN IT CERTIFIED THAT TO THE PROCUREMENT OFFICERS THE PROCUREMENT OFFICERS SHOULD CONSIDER IT AS A WAR INDUSTRY AND SHOULD UNDERTAKE TO CONTRACT WITH IT.

SEE, ALSO, TO THE SAME EFFECT, PAGES 36 THROUGH 38 OF THE HOUSE HEARINGS ON S. 2250 AND H.R. 6975 BEFORE THE COMMITTEE ON BANKING AND CURRENCY ON APRIL 27, 1942. S. 2250 WAS ENACTED AS PUBLIC LAW 603, 56 STAT. 351, AND SECTION 2 THEREOF, 50 U.S.C. APP. 1102, PROVIDED THAT THE CHAIRMAN OF THE WAR PRODUCTION BOARD WAS DIRECTED:

(6) TO CERTIFY TO GOVERNMENT PROCUREMENT OFFICERS WITH RESPECT TO THE COMPETENCY, AS TO CAPACITY AND CREDIT, OF ANY SMALL BUSINESS CONCERN OR GROUP OF SUCH CONCERNS TO PERFORM A SPECIFIC GOVERNMENT PROCUREMENT CONTRACT;

SECTION 3 OF THAT ACT, 50 U.S.C. APP. 1103, MADE THE CERTIFICATE OF COMPETENCY CONCLUSIVE ON PROCUREMENT OFFICERS.

OFFICIALS OF THE SMALL DEFENSE PLANTS ADMINISTRATION TESTIFYING ON BEHALF OF H.R. 5141, 83RD CONGRESS, FIRST SESSION, WHICH WAS ENACTED AS PUBLIC LAW 163, TITLE II OF WHICH WAS THE SMALL BUSINESS ACT OF 1953, 67 STAT. 232-240, 15 U.S.C. 631 NOTE, STATED ON PAGE 197 OF THE SENATE HEARINGS THAT THE CERTIFICATE OF COMPETENCY COVERS "* * * THE ABILITY TO PRODUCE, AND ON TIME, IN THE QUALITY AND QUANTITY DESIRED * * *.' THE DEPARTMENT OF DEFENSE BY LETTER OF MAY 21, 1953, CHAIRMAN OF THE SENATE COMMITTEE ON BANKING AND CURRENCY MADE THE FOLLOWING STATEMENT REGARDING CERTIFICATES OF COMPETENCY CONTEMPLATED BY THE PROPOSED LEGISLATION:

UNDER SECTION 13 PROCUREMENT OFFICERS WOULD BE REQUIRED TO ACCEPT THE NEW AGENCY'S CERTIFICATION OF CAPACITY AND CREDIT AS CONCLUSIVE. THIS WOULD PERMANENTLY REMOVE FROM PROCURING OFFICERS THE POWER TO DETERMINE THESE ESSENTIAL CONTRACTUAL ELEMENTS WHILE THEY NEVERTHELESS RETAINED RESPONSIBILITY FOR THE RESULTS OF THEIR PROCUREMENT OPERATIONS. IT IS NOT BELIEVED THAT SUCH A DIVISION OF RESPONSIBILITY IS WARRANTED OR DESIRABLE ON A PERMANENT BASIS.

HOWEVER, THE CONGRESS ENACTED H.R. 5141 AS PUBLIC LAW 163 AND IT WAS SPECIFICALLY PROVIDED IN SECTION 212 THEREOF, 15 U.S.C. 641, THAT SBA WAS DIRECTED:

(D) TO CERTIFY TO GOVERNMENT PROCUREMENT OFFICERS WITH RESPECT TO THE COMPETENCY, AS TO CAPACITY AND CREDIT, OF ANY SMALL-BUSINESS CONCERN OR GROUP OF SUCH CONCERNS TO PERFORM A SPECIFIC GOVERNMENT PROCUREMENT CONTRACT;

PARTICULARLY SIGNIFICANT IS THE FOLLOWING STATEMENT OF REPRESENTATIVE PATMAN ON PAGE 9154 OF THE CONGRESSIONAL RECORD FOR JULY 30, 1951, WHEREIN HE DISCUSSED THE SMALL DEFENSE PLANTS ADMINISTRATION AUTHORITY TO ISSUE CERTIFICATES OF COMPETENCY UNDER THE DEFENSE PRODUCTION ACT STAT. AMENDMENTS OF 1951, 65 STAT. 142, 50 U.S.C. APP. 2163A:

* * * THIS GROUP, THE SMALL DEFENSE PLANTS ADMINISTRATION, WILL BE ABLE TO INVESTIGATE THE CREDIT STANDING AND THE ABILITY TO PERFORM OF ANY CONCERN IN THE UNITED STATES FOR A RATING FOR THAT CONCERN, AND WHATEVER THIS AGENCY SAYS ABOUT THE CREDIT STANDING AND THE ABILITY TO PERFORM WILL BE TAKEN AS CONCLUSIVE BY ANY AGENCY OF OUR GOVERNMENT, AND THAT IS A VERY VALUABLE FEATURE, I MUST INSIST. LIKE IT IS NOW, WHEN A PROCUREMENT AGENCY IS ANXIOUS TO LET A CONTRACT OF SOME KIND FOR THE MANUFACTURE OF AN ESSENTIAL WAR MACHINE, WHAT DOES THE PROCUREMENT OFFICER DO? JUST LIKE YOU WOULD DO OR JUST LIKE I WOULD DO. HE GIVES IT TO A BIG CONCERN LIKE GENERAL MOTORS OR GENERAL ELECTRIC, A CONCERN ABOUT WHICH THERE IS NO DOUBT AS TO ITS ABILITY TO PERFORM OR AS TO ITS CREDIT RATING. THEN IF THERE IS SOME MISTAKE MADE ABOUT THAT CONTRACT YOU CANNOT BLAME THE PROCUREMENT OFFICER BECAUSE HE USED GOOD JUDGMENT, WHEREAS IF HE HAD TAKEN YOUR CONCERN IN YOUR DISTRICT, WHICH IS JUST AS GOOD AS ANY LITTLE CONCERN IN THE WORLD COULD POSSIBLE BE, AND WHOSE CREDIT RATING IS GOOD AND WHOSE ABILITY TO PERFORM IS EXCELLENT, AND THEN SOMETHING HAPPENED, THE PROCUREMENT OFFICER WOULD BE BLAMED. BUT, THAT IS THE OBJECT OF THIS PROVISION, AND THAT IS TO PLACE THE RESPONSIBILITY IN AN AGENCY TO CERTIFY FINANCIAL STANDING AND ABILITY TO PERFORM WHICH SHALL BE CONCLUSIVE TO THAT PROCUREMENT OFFICER. THEN IF HE GIVES IT TO THE SMALL CONCERN, NOBODY CAN CRITICIZE HIM. HE IS NOT VULNERABLE, AND I THINK THAT IS AN EXCELLENT PROVISION.

IN VIEW THEREOF, WE ARE OF THE OPINION THAT "CAPACITY" AS USED IN SECTION 8 (B) (7) HAS REFERENCE TO THE OVER-ALL ABILITY OF A PROSPECTIVE SMALL BUSINESS CONTRACTOR TO MEET QUALITY, QUANTITY, AND TIME REQUIREMENTS OF A PROCUREMENT AS TO WHICH A CERTIFICATE OF COMPETENCY HAS BEEN ISSUED TO THE SMALL BUSINESS CONCERN.

THE DECISIONS OF OUR OFFICE RELIED UPON IN SUPPORT OF THE POSITION OF YOUR DEPARTMENT, SUCH AS 26 COMP. GEN. 676; 30 ID. 235; 33 ID. 549; AND 34 ID. 86, DID NOT INVOLVE CASES WHEREIN CERTIFICATES OF COMPETENCY WERE ISSUED TO A PROSPECTIVE CONTRACTOR, BUT RATHER INVOLVED SITUATIONS WHEREIN THE CONTRACTING OFFICER SOLELY WAS RESPONSIBLE TO A PROSPECTIVE CONTRACTOR. IN 37 COMP. 676 WE CITED SPECIFIC ELEMENTS OF "RESPONSIBILITY," BUT NONE OF THESE ILLUSTRATIVE ELEMENTS INCLUDED ABILITY TO PERFORM, ORGANIZATION, TECHNICAL SKILLS,"KNOW HOW" OR TECHNICAL EQUIPMENT OR FACILITIES. HENCE, THE DECISIONS UPON WHICH YOU RELY ARE NOT DETERMINATIVE OF THE PROBLEM HERE INVOLVED. IN B-138233 DATED FEBRUARY 24, 1959, WE HELD THAT THE FINALITY OF A CERTIFICATE OF COMPETENCY DOES NOT EXTEND TO LACK OF INTEGRITY AND CONCLUDED THAT DEFICIENCIES IN THE AREA OF BUSINESS PRACTICES ARE NOT SUBJECT TO CERTIFICATION. HOWEVER, THE DEFICIENCIES THERE INVOLVED WENT TO THE BUSINESS ETHICS OF THE PROSPECTIVE CONTRACTOR AND NOT TO BUSINESS MANAGEMENT.

ACCORDINGLY, IT IS OUR VIEW THAT ELEMENTS OF RESPONSIBILITY RELATING TO AMECO'S ABILITY TO PERFORM, EXPERIENCE, SKILL,"KNOW HOW," TECHNICAL KNOWLEDGE, ETC., ARE INCLUDED WITHIN THE CERTIFICATE OF COMPETENCY ISSUED TO AMECO.