B-163671, JUL. 18, 1968

B-163671, JUL. 18, 1968

TO MR. EDWARD STEELE PATTERSON:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 19, 1968, PROTESTING THAT THE LOW BID FROM YOUR COMPANY UNDER POST OFFICE DEPARTMENT INVITATION FOR BIDS 8-066 SHOULD NOT HAVE BEEN REJECTED WITHOUT REFERRING THE MATTER TO THE SMALL BUSINESS ADMINISTRATION, SINCE YOUR COMPANY IS A SMALL BUSINESS CONCERN.

THE INVITATION SOLICITED BIDS FOR THE COMPLETE MAINTENANCE OF 15 HIGH- SPEED AUTOMATIC PASSENGER ELEVATORS AT THE CHICAGO MAIN POST OFFICE. THE INVITATION STATED THAT THE TERM OF THE CONTRACT IS FOR 1 YEAR COMMENCING FEBRUARY 18, 1968, WITH TWO 1-YEAR RENEWAL OPTIONS. THE INVITATION PROVIDED THAT THE CONTRACTOR SHALL HAVE A QUALIFIED SERVICE ORGANIZATION IN ACTIVE OPERATION FOR A MINIMUM OF 10 YEARS AND THAT THE ORGANIZATION MUST HAVE A HISTORY OF COMPETENT EXPERIENCE IN MAINTAINING A 7-PATTERN AUTOMATIC ELEVATOR SYSTEM.

TWO BIDS WERE RECEIVED TO PERFORM THE MAINTENANCE SERVICE. YOUR COMPANY'S BID IN THE AMOUNT OF $3,450 PER MONTH WAS THE LOW BID. THE OTHER BID IN THE AMOUNT OF $3,825 PER MONTH WAS FROM THE WESTINGHOUSE ELECTRIC CORPORATION.

YOUR COMPANY'S BID WAS DETERMINED TO BE NONRESPONSIVE WHEN A PREAWARD SURVEY DISCLOSED THAT YOUR COMPANY DID NOT HAVE A SERVICE ORGANIZATION THAT HAD BEEN IN OPERATION FOR 10 YEARS AND THAT IT DID NOT HAVE EXPERIENCE IN MAINTAINING A 7-PATTERN SYSTEM OR ANY SIMILAR SYSTEM. YOUR COMPANY'S BID WAS THEREFORE REJECTED AND AWARD WAS MADE TO WESTINGHOUSE ELECTRIC CORPORATION.

OUR OFFICE HAS HELD THAT THE INCLUSION OF QUALITATIVE AND QUANTITATIVE EXPERIENCE REQUIREMENTS IN AN INVITATION FOR BIDS CANNOT BE CONSIDERED AS TRANSFORMING THE PURELY FACTUAL QUESTION OF RESPONSIBILITY INTO A LEGAL QUESTION OF CONFORMITY TO THE INVITATION. 39 COMP. GEN. 173. FURTHER, OUR OFFICE HAS HELD THAT THE INCLUSION OF EXPERIENCE QUALIFICATIONS IN AN INVITATION CANNOT DEFEAT THE STATUTORY AUTHORITY VESTED IN THE SMALL BUSINESS ADMINISTRATION TO MAKE DETERMINATIONS OF CAPACITY AND CREDIT. COMP. GEN. 106. IT WAS THEREFORE ERRONEOUS FOR THE CONTRACTING OFFICER TO REJECT YOUR COMPANY'S BID WITHOUT REFERRING THE MATTER OF ITS RESPONSIBILITY TO THE SMALL BUSINESS ADMINISTRATION. HOWEVER, THE VALIDITY OF THE AWARD MADE TO WESTINGHOUSE IS DEPENDENT UPON WHETHER THE SMALL BUSINESS ADMINISTRATION WOULD FIND THAT YOUR COMPANY HAS THE NECESSARY CAPACITY AND CREDIT TO PERFORM. 40 COMP. GEN. 106. ACCORDINGLY, OUR OFFICE REQUESTED THE SMALL BUSINESS ADMINISTRATION TO REVIEW THE CAPACITY AND CREDIT OF YOUR COMPANY AND TO ADVISE OUR OFFICE WHETHER IT IS COMPETENT TO PERFORM THE CONTRACT. THE SMALL BUSINESS ADMINISTRATION HAS ADVISED US THAT IT HAS DETERMINED THAT YOUR COMPANY DOES NOT POSSESS THE NECESSARY CAPACITY AND CREDIT TO PERFORM THE WORK INVOLVED.

ACCORDINGLY, ALTHOUGH OUR OFFICE AGREES THAT THE MATTER OF YOUR RESPONSIBILITY SHOULD HAVE BEEN REFERRED TO THE SMALL BUSINESS ADMINISTRATION BY THE CONTRACTING OFFICER INITIALLY, IT HAS BECOME ACADEMIC IN VIEW OF THE SMALL BUSINESS ADMINISTRATION DETERMINATION THAT YOUR COMPANY DOES NOT HAVE THE NECESSARY CAPACITY AND CREDIT. YOUR PROTEST IS THEREFORE DENIED. HOWEVER, THE CASE IS BEING BROUGHT TO THE ATTENTION OF THE POSTMASTER GENERAL WITH A REQUEST THAT APPROPRIATE STEPS BE TAKEN TO INSURE THAT PROPER PROCEDURES ARE FOLLOWED IN THE FUTURE.