B-152007, DEC. 9, 1963

B-152007, DEC. 9, 1963

TO THE UNITEC CORPORATION:

REFERENCE IS MADE TO YOUR LETTER DATED NOVEMBER 13, 1963, COMMENTING ON OUR DECISION TO YOU OF OCTOBER 31, 1963, WHICH DENIED YOUR PROTEST AGAINST THE REJECTION OF YOUR PROPOSAL AND THE MAKING OF A CONTRACT AWARD TO LENKURT ELECTRIC COMPANY, INC., SAN CARLOS, CALIFORNIA, UNDER REQUEST FOR QUOTATIONS NO. 595-63Q, ISSUED MAY 21, 1963, BY THE NAVY PURCHASING OFFICE, FOR THE PROCUREMENT OF FIELD TECHNICIANS TO PROVIDE MAINTENANCE AND OPERATION OF THE PUERTO RICO MICROWAVE COMPLEX DURING THE PERIOD JULY 1, 1963, THROUGH JUNE 30, 1964.

THE DECISION SETS FORTH THAT THE PROPOSALS OF YOUR COMPANY AND LENKURT ELECTRIC COMPANY, INC., WERE IN THE RESPECTIVE AMOUNTS OF $239,904 AND $388,480; THAT YOUR PROPOSAL WAS REJECTED ON THE BASIS OF THE CONTRACTING OFFICER'S DETERMINATION THAT YOUR COMPANY DID NOT QUALIFY AS A RESPONSIBLE PROSPECTIVE CONTRACTOR; THAT YOUR FIRM APPARENTLY WAS PERFORMING MAINTENANCE SERVICES FOR THE MICROWAVE NETWORK IN PUERTO RICO IN THE FALL OF 1962 BEFORE THE INSTALLATION OF VARIOUS ITEMS OF LENKURT EQUIPMENT; AND THAT THE SPECIFICATIONS FOR THE PROPOSED FISCAL-YEAR 1964 CONTRACT MADE IT DIFFICULT FOR ANY FIRM OTHER THAN LENKURT ELECTRIC COMPANY, INC., TO QUALIFY AS A RESPONSIBLE PROSPECTIVE CONTRACTOR. WE CONCLUDED THAT THE SPECIFICATIONS DID NOT APPEAR TO BE MORE RESTRICTIVE THAN NECESSARY, THAT THE REJECTION OF YOUR PROPOSAL WAS BASED UPON REASONABLE GROUNDS AND THAT THE FACTS OF THE CASE WERE NOT SUCH AS TO JUSTIFY A BELIEF THAT THE DEPARTMENT OF THE NAVY ACTED OTHER THAN IN GOOD FAITH.

WE WERE VERY MUCH CONCERNED WITH THE FACT THAT THE QUESTION OF YOUR RESPONSIBILITY AS TO CAPACITY AND CREDIT WAS NOT REFERRED TO THE SMALL BUSINESS ADMINISTRATION FOR CONSIDERATION DUE TO A REPORTED URGENCY FOR MAKING THE CONTRACT AWARD. HOWEVER, WE CONSIDERED THAT THE EVIDENCE OF RECORD WAS INSUFFICIENT TO ESTABLISH THAT THE NAVY UNREASONABLY DELAYED THE PREPARATION OF THE APPLICABLE SPECIFICATIONS OR OTHERWISE ATTEMPTED TO CIRCUMVENT THE CERTIFICATE OF COMPETENCY PROVISIONS OF THE SMALL BUSINESS ACT AND THE IMPLEMENTING ADMINISTRATIVE REGULATION (SUBSECTION 1.705.6 OF THE ARMED SERVICES PROCUREMENT REGULATION).

YOU STILL MAINTAIN THAT YOUR COMPANY WAS TREATED UNFAIRLY IN THE MATTER AND YOU INVITE ATTENTION PARTICULARLY TO THE FACT THAT A CONFERENCE WAS SCHEDULED WITH YOUR REPRESENTATIVES FOR MONDAY, JUNE 24, 1963, AT 10:00 A.M., NOTICE OF WHICH WAS RECEIVED BY YOU ON A NON-WORK DAY, SATURDAY, JUNE 22. YOU STATE THAT YOU ATTEMPTED TO DELAY THE CONFERENCE, IF ONLY UNTIL MONDAY AFTERNOON, BUT THAT YOU WERE ADVISED THAT ALL NAVY PERSONNEL WERE NOTIFIED AND IT WOULD BE DIFFICULT TO CONTACT THEM AND REVISE THE 10:00 A.M., STARTING TIME.

YOU ALSO EXPRESS THE VIEW THAT IT WAS ONLY BY DESIGN THAT THE NAVY SELECTED JUNE 20, 1963, AS THE FINAL DATE FOR SUBMISSION OF PROPOSALS, SINCE THE NAVY PURCHASING OFFICE WAS AWARE AS EARLY AS DECEMBER 1962 THAT MAINTENANCE SERVICE WOULD BE REQUIRED FOR THE PROGRAM DURING FISCAL YEAR 1964.

REGARDING THE TIME FOR SCHEDULING OF A PREAWARD CONFERENCE WITH YOUR REPRESENTATIVES, WE DO NOT AGREE THAT THE NAVY CAN BE SAID, AS YOU SUGGEST, TO HAVE ALREADY MADE UP ITS MIND NEGATIVELY TOWARD YOUR COMPANY. YOU HAD SUBMITTED A PROPOSAL WHICH YOU SHOULD HAVE BEEN FULLY PREPARED TO SUBSTANTIATE WHEN CALLED UPON TO DO SO, AND WE BELIEVE THAT ANY DELAY IN SCHEDULING A CONFERENCE WITH YOUR REPRESENTATIVES WOULD NOT HAVE BEEN REQUIRED EXCEPT FOR THE MOST COGENT REASONS. IN ANY EVENT, YOU HAD HAD A MONTH'S NOTICE OF THE REQUIREMENTS FOR QUALIFICATION OF PERSONNEL, AND SINCE YOU APPARENTLY HAD NOT OBTAINED FIRM COMMITMENTS FROM A SUFFICIENT NUMBER OF PROSPECTIVE EMPLOYEES DURING THAT TIME, WE COULD NOT CONSIDER AS UNREASONABLE THE NAVY'S CONCLUSION THAT YOU HAD NOT ESTABLISHED YOUR ABILITY TO HAVE SUCH PERSONNEL AVAILABLE ON JULY 1.

ACTION WITH A VIEW TOWARD NEGOTIATING A SERVICE CONTRACT FOR THE FISCAL YEAR 1964 WAS INITIATED DURING THE MONTH OF APRIL 1963, OR MORE THAN TWO MONTHS BEFORE THE BEGINNING OF THE FISCAL YEAR 1964. AS STATED IN OUR DECISION, THE REQUEST FOR PROPOSALS WAS MADE READY FOR DRAFTING ON MAY 13, 1963, AND THE FORMAL REQUEST WAS MAILED ON MAY 21 WITH A SCHEDULED OPENING DATE OF JUNE 20. WHILE WE ARE AWARE OF NO REASON WHY IT WOULD HAVE BEEN IMPOSSIBLE TO HAVE INITIATED THE NEGOTIATION PROCESS BEFORE THE MONTH OF APRIL 1963, WE DO NOT AGREE THAT THIS IS NECESSARILY INDICATIVE OF AN INTENTION ON THE PART OF THE NAVY TO PROCEED IN SUCH A MANNER AS TO OBVIATE THE NECESSITY FOR REFERRAL OF ANY SMALL BUSINESS PROPOSAL TO THE SMALL BUSINESS ADMINISTRATION PRIOR TO REJECTION THEREOF ON THE BASIS OF A DETERMINATION BY THE CONTRACTING OFFICER THAT THE BIDDER WAS NOT RESPONSIBLE AS TO CAPACITY OR CREDIT.

WE REGRET THAT YOU CONSIDER THE DENIAL OF YOUR PROTEST IN THE MATTER AS HAVING CAUSED ON YOUR PART A LOSS OF CONFIDENCE IN THE POLICIES OF THE DEPARTMENT OF DEFENSE TO REDUCE THE AMOUNT OF OVERPRICED SOLE SOURCE CONTRACT AWARDS AND TO ASSIST SMALL BUSINESS CONCERNS IN OBTAINING A FAIR SHARE OF GOVERNMENT PROCUREMENTS. HOWEVER, SINCE OUR REVIEW OF THE FACTS OF THE CASE HAS DISCLOSED NO BASIS ON WHICH WE WOULD FEEL JUSTIFIED IN REACHING A DIFFERENT CONCLUSION FROM THAT ..END :