B-124614, SEPTEMBER 29, 1955, 35 COMP. GEN. 161

B-124614: Sep 29, 1955

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WAS PROPER. 1955: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JULY 12. WAS THE LOWEST OF FIVE RECEIVED. INDICATES THAT ALL SERVICES' QUALIFICATIONS WERE QUESTIONED ON THE BASIS OF PARAGRAPH 1- 01 OF THE SPECIFICATIONS. WHICH READ AS FOLLOWS: IT IS THE DECLARED AND ACKNOWLEDGED INTENTION AND MEANING OF THESE SPECIFICATIONS TO SECURE ON AN ANNUAL FISCAL YEAR BASIS COMPOSITE CLEANING SERVICES FROM A RESPONSIBLE CONTRACTOR CURRENTLY PERFORMING LARGE SCALE CLEANING OPERATIONS IN THE BOSTON AREA FOR THE CLEANING OF GOVERNMENT- OWNED AND OCCUPIED SPACE AND CERTAIN OFFICE AND BUILDING FIXTURES AS HEREINAFTER SCHEDULED. THE FACTS WERE DEVELOPED INDEPENDENTLY BY THE CONTRACTING OFFICER THROUGH A PREAWARD INVESTIGATION BY THE INSPECTOR OF NAVAL MATERIAL IN BOSTON OF FINANCIAL AND OPERATING CAPABILITIES.

B-124614, SEPTEMBER 29, 1955, 35 COMP. GEN. 161

BIDDERS - QUALIFICATIONS - EXPERIENCE WHERE AN INVITATION FOR FURNISHING JANITORIAL AND CLEANING SERVICES STIPULATED THAT CURRENT PERFORMANCE OF LARGE SCALE CLEANING OPERATIONS WOULD BE AN ESSENTIAL QUALIFICATION OF THE BIDDER AND SUCH QUALIFICATION WOULD BE CONSIDERED IN EVALUATING THE BID, REJECTION OF THE LOW BID, SUBMITTED BY A NEWLY ORGANIZED CONCERN WHICH HAD NOT DEMONSTRATED ITS ABILITY TO PERFORM COMPARABLE SERVICES, WAS PROPER.

TO W. LANGDON POWERS, SEPTEMBER 29, 1955:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JULY 12, 1955, PROTESTING, ON BEHALF OF ALL SERVICES, INCORPORATED, REJECTION OF THAT CONCERN'S BID, AND AWARD OF A CONTRACT TO THE AMERICAN CLEANING COMPANY, FOR FURNISHING JANITORIAL AND CLEANING SERVICES AT THE NAVY BUILDING IN BOSTON UNDER INVITATION NO. IFB-111-5-56, DATED MAY 24, 1955.

THE BID OF ALL SERVICES, INCORPORATED, IN THE AMOUNT OF $56,933.12, WAS THE LOWEST OF FIVE RECEIVED, THE NEXT-LOWEST BEING THAT OF THE AMERICAN CLEANING COMPANY IN THE AMOUNT OF $62,574.15. A REPORT BY THE CHIEF, BUREAU OF SUPPLIES AND ACCOUNTS, DEPARTMENT OF THE NAVY, INDICATES THAT ALL SERVICES' QUALIFICATIONS WERE QUESTIONED ON THE BASIS OF PARAGRAPH 1- 01 OF THE SPECIFICATIONS, WHICH READ AS FOLLOWS:

IT IS THE DECLARED AND ACKNOWLEDGED INTENTION AND MEANING OF THESE SPECIFICATIONS TO SECURE ON AN ANNUAL FISCAL YEAR BASIS COMPOSITE CLEANING SERVICES FROM A RESPONSIBLE CONTRACTOR CURRENTLY PERFORMING LARGE SCALE CLEANING OPERATIONS IN THE BOSTON AREA FOR THE CLEANING OF GOVERNMENT- OWNED AND OCCUPIED SPACE AND CERTAIN OFFICE AND BUILDING FIXTURES AS HEREINAFTER SCHEDULED.

ALTHOUGH CERTAIN REPRESENTATIONS HAD BEEN MADE IN THE MATTER BY OTHERS INTERESTED IN THE AWARD, THE FACTS WERE DEVELOPED INDEPENDENTLY BY THE CONTRACTING OFFICER THROUGH A PREAWARD INVESTIGATION BY THE INSPECTOR OF NAVAL MATERIAL IN BOSTON OF FINANCIAL AND OPERATING CAPABILITIES. IN THE WORDS OF THE CHIEF OF THE BUREAU OF SUPPLIES AND ACCOUNTS. THE PERTINENT REPORT

* * * DISCLOSED THAT THE LOW BIDDER, ALL SERVICES, INC., HAD BEEN INCORPORATED ONLY THREE MONTHS BEFORE, ON 1 APRIL 1955; THAT FORMERLY IT WAS A PART OF THE COLUMBIA VAN AND STORAGE COMPANY OF BOSTON AND ENGAGED PRINCIPALLY IN CLEANING UP PREMISES AFTER PROPERTY WAS MOVED OUT; THAT SINCE ITS INCORPORATION IT HAD NOT HELD A GOVERNMENT CONTRACT, AND ITS PAST OPERATIONS IN THE COMMERCIAL FIELD HAD INVOLVED SMALL-SCALE ASSIGNMENTS WHICH WERE AT THE RATE OF ABOUT $1200 PER MONTH; THAT ITS ONE LARGER COMMERCIAL CONTRACT WOULD NOT BEGIN UNTIL COMPLETION OF A NEW BUILDING ABOUT 1 AUGUST 1955; THAT VENETIAN BLIND WORK UNDER THE NAVY CONTRACT WOULD BE SUBCONTRACTED; THAT IT OCCUPIED 150 SQUARE FEET OF FLOOR SPACE FOR OFFICES AND 100 SQUARE FEET FOR STORAGE OF SUPPLIES AND EQUIPMENT IN THE PREMISES OF THE COLUMBIA VAN AND STORAGE COMPANY; AND THAT IT WOULD RENT NECESSARY TRANSPORTATION SERVICES FROM THAT COMPANY, HAVING NONE OF ITS OWN. THE REPORT FURTHER STATED THAT THE FIRM HAD ONLY ELEVEN EMPLOYEES, SEVEN FULL TIME AND FOUR PART-TIME, OF WHOM SIX WERE PRODUCTION EMPLOYEES, FOUR MANAGERIAL, AND ONE "OTHER.' ONLY ONE OF THESE MAY HAVE BEEN QUALIFIED BY EXPERIENCE TO SUPERVISE CLEANING OPERATIONS. THE PRESIDENT WAS EMPLOYED FULL TIME AS SUPERVISOR OF ENGINEERS FOR THE EMPLOYERS GROUP INSURANCE COMPANY OF BOSTON; THE VICE-PRESIDENT WAS EMPLOYED FULL TIME AS A TEACHER IN THE CITY OF SOMERVILLE SCHOOL SYSTEM; THE TREASURER WAS EMPLOYED AS VICE PRESIDENT AND GENERAL MANAGER OF THE COLUMBIA VAN AND STORAGE COMPANY; AND THE GENERAL MANAGER AND CLERK, A FULL TIME EMPLOYEE OF ALL SERVICES, BEFORE 1 APRIL 1955 HAD BEEN IN THE SALES ORGANIZATION OF THE COLUMBIA VAN AND STORAGE COMPANY AND ALSO SERVED AS A SUPERVISOR OF OPERATIONS. THE LOW BIDDER HAD EMPLOYED THE SERVICES OF A CONSULTANT IN REVIEWING THE CONTRACT REQUIREMENTS PRIOR TO SUBMITTING ITS BID. * * *

IT IS NOT BELIEVED THAT THERE IS ANY DISAGREEMENT WITH THE FACTS THUS ESTABLISHED, ALTHOUGH YOUR PETITION, ASIDE FROM SOME DISCUSSION OF FINANCIAL CAPABILITIES WHICH DO NOT APPEAR TO BE IN QUESTION, ADDS TO THE FACTUAL INFORMATION BY EXPLAINING THAT QUALIFIED PERSONNEL WERE AVAILABLE IN LARGER NUMBERS THAN RECOGNIZED. OF COURSE, WHILE HIRING ABILITY IS A FACTOR IN DETERMINING POTENTIAL OPERATING CAPABILITY, IT DOES NOT INSURE ADEQUATE PERFORMANCE TO THE SAME EXTENT AS EXPERIENCE.

AN EXPERIENCE QUALIFICATION HAS BEEN FOUND TO BE MORE IMPORTANT IN OBTAINING SERVICES THAN IT IS IN OBTAINING SUPPLIES, SINCE REJECTION OF SUBSTANDARD PERFORMANCE, IF ENCOUNTERED, RESULTS IN GREATER DISRUPTION OF BUSINESS AND IS LESS READILY CORRECTED OR REPLACED. CONSEQUENTLY, IT OFTEN IS NECESSARY TO PLACE RELIANCE UPON A BIDDER'S RECORD OF CURRENT OR PAST SATISFACTORY PERFORMANCE OF COMPARABLE SERVICES.

THE VIEW OF THE DEPARTMENT OF THE NAVY, AS INDICATED BY THE ASSISTANT SECRETARY IN TRANSMITTING THE OFFICIAL REPORT TO US, IS THAT " THE BIDDER WAS A NEOPHYTE ORGANIZATION THAT WAS NOT QUALIFIED BY PRIOR EXPERIENCE OR PRESENT ORGANIZATION TO UNDERTAKE AN ANNUAL JANITORIAL AND OFFICE CLEANING CONTRACT OF THE MAGNITUDE AND IMPORTANCE INVOLVED.' EVEN ASSUMING THAT ARRANGEMENTS EXISTED TO ENGAGE AN ADEQUATE STAFF OF WORKMEN, ACTUAL OPERATING CAPABILITY HAD NOT BEEN DEMONSTRATED. EVEN IF ALL SERVICES WAS THEORETICALLY IN A POSITION TO UNDERTAKE THE PERFORMANCE OF A LARGE ANNUAL JANITORIAL AND OFFICE CLEANING CONTRACT, ITS ABILITY TO DO SO IN A TROUBLE -FREE MANNER WAS NOT DEFINITELY ESTABLISHED.

THE TERMS OF THE INVITATION STIPULATED THAT CURRENT PERFORMANCE OF LARGE SCALE CLEANING OPERATIONS WOULD BE AN ESSENTIAL QUALIFICATION AND RESERVED TO THE GOVERNMENT DISCRETION TO EVALUATE BIDS AND AWARD A CONTRACT FROM SUCH A VIEWPOINT. THE CONTRACTING OFFICER DOES NOT APPEAR TO HAVE ACTED UNFAIRLY OR WITHOUT DUE REGARD FOR THE FACTS IN EXERCISING THAT DISCRETION. WE PERCEIVE NO LEGAL BASIS, THEREFORE, UPON WHICH HIS DETERMINATION THAT THE BEST INTEREST OF THE GOVERNMENT NECESSITATED REJECTION OF THE LOW BID SUBMITTED BY ALL SERVICES, INCORPORATED, MAY BE DISTURBED.