B-125140, OCT. 20, 1955

B-125140: Oct 20, 1955

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SOLDEVILA AND RNO.: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 27. PERTINENT PROVISIONS OF THE INVITATION TO BID ARE AS FOLLOWS: "SECTION 19 AWARD. "A. THE CONTRACT WILL BE AWARDED TO THE LOWEST RESPONSIBLE BIDDER. PROVIDED HIS BID IS REASONABLE. IT IS TO THE BEST INTEREST OF THE GOVERNMENT TO ACCEPT IT. "C. THE GOVERNMENT FURTHER RESERVES THE RIGHT TO REJECT ANY AND ALL BIDS WHEN SUCH REJECTION IS IN THE INTEREST OF THE GOVERNMENT. TO REJECT THE BID OF A BIDDER WHO IS NOT. IN REGISTERING YOUR PROTEST YOU CONTEND THAT YOU WERE THE LOWEST RESPONSIBLE BIDDER. THAT YOUR PRICE WAS REASONABLE. THAT IT WAS TO THE BEST INTEREST OF THE GOVERNMENT TO AWARD THE CONTRACT TO YOU. IT WAS DETERMINED ADMINISTRATIVELY TO REJECT YOUR BID AS UNREASONABLE AND NOT IN THE INTEREST OF THE GOVERNMENT TO ACCEPT.

B-125140, OCT. 20, 1955

TO LUIS A. SOLDEVILA AND RNO.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 27, 1955, PROTESTING AGAINST THE AWARD OF A CONTRACT TO SAN JUAN TRUCKING ENTERPRISE, INC., UNDER INVITATION NO. TC-96-600-55-1, ISSUED BY THE DEPARTMENT OF THE ARMY, MILITARY DISTRICT OF PUERTO RICO, FOR PACKING, CRATING, UNPACKING, UNCRATING AND TRANSPORTATION OF HOUSEHOLD GOODS FOR THE GOVERNMENT.

PERTINENT PROVISIONS OF THE INVITATION TO BID ARE AS FOLLOWS:

"SECTION 19 AWARD.

"A. THE CONTRACT WILL BE AWARDED TO THE LOWEST RESPONSIBLE BIDDER, PRICE AND OTHER FACTORS CONSIDERED, PROVIDED HIS BID IS REASONABLE, AND IT IS TO THE BEST INTEREST OF THE GOVERNMENT TO ACCEPT IT.

"B. THE GOVERNMENT RESERVES THE RIGHT TO MAKE AN AWARD TO THE LOWEST RESPONSIBLE BIDDER BASED ON THE TOTAL AGGREGATE LOW BID SUBMITTED FOR ALL ITEMS.

"C. THE GOVERNMENT FURTHER RESERVES THE RIGHT TO REJECT ANY AND ALL BIDS WHEN SUCH REJECTION IS IN THE INTEREST OF THE GOVERNMENT; TO REJECT THE BID OF A BIDDER WHO HAS PREVIOUSLY FAILED TO PERFORM PROPERLY OR COMPLETE ON TIME CONTRACTS OF A SIMILAR NATURE; AND TO REJECT THE BID OF A BIDDER WHO IS NOT, IN THE OPINION OF THE CONTRACTING OFFICER, IN A POSITION TO PERFORM THE CONTRACT.'

IN REGISTERING YOUR PROTEST YOU CONTEND THAT YOU WERE THE LOWEST RESPONSIBLE BIDDER; THAT YOUR PRICE WAS REASONABLE; AND THAT IT WAS TO THE BEST INTEREST OF THE GOVERNMENT TO AWARD THE CONTRACT TO YOU. IN THIS CONNECTION, THE RECORD SHOWS THAT, FOLLOWING A PRE-AWARD STUDY, IT WAS DETERMINED ADMINISTRATIVELY TO REJECT YOUR BID AS UNREASONABLE AND NOT IN THE INTEREST OF THE GOVERNMENT TO ACCEPT. THE BASES FOR SUCH DETERMINATION ARE SET FORTH IN A REPORT WHICH WAS FORWARDED HERE UNDER DATE OF SEPTEMBER 28, 1955, BY THE ASSISTANT SECRETARY OF THE ARMY, A PORTION OF WHICH IS AS FOLLOWS:

"/1) THAT OUT OF A TOTAL OF 24 ITEMS UPON WHICH BIDS WERE SUBMITTED, THE BID IN QUESTION WAS LOW, BUT THAT ON 13 ITEMS UPON WHICH EXPERIENCE INDICATED THE GOVERNMENT WOULD CALL UPON THE CONTRACTOR TO PURSUE, THE BID EXCEEDED THE MOST HIGHEST BID BY MORE THAN $20,000.00. IT APPEARED THAT THIS BIDDER KNEW WHAT ITEMS THE GOVERNMENT WOULD LIKELY PURSUE AND BID UNREASONABLY HIGH ON CERTAIN SUCH ITEMS AND UNREASONABLY LOW ON OTHER ITEMS. IN THIS REGARD, IT WAS NOTED THAT THE BID WAS SUBMITTED UPON AN "ALL OR NONE" BASIS. * * *

"IN COMPARING ITEM NO. 21 WITH ITEM NO. 1, IT WAS NOTED THAT THE BIDDER IN QUESTION SUBMITTED A BID OF ?01 CENTS PER NET CWT TO PACK, CRATE, CUBE, MARK, STRAP AND WEIGH HOUSEHOLD GOODS, AND A BID OF $2.00 PER NET CWT TO UNPACK SUCH GOODS AND PLACE THEM IN A RESIDENCE. IN COMPARING ITEM NO. 18 WITH ITEM NO. 19, IT WAS NOTED THAT THE BIDDER SUBMITTED A BID OF $2.50 PER NET CWT TO TRANSPORT CRATED GOODS FROM FORT BUCHANAN TO ARMY TERMINAL (APPROXIMATELY 2 MILES) AND A BID OF .20 PER CWT TO TRANSPORT THE SAME TYPE OF GOODS TO SABANA SECA (APPROXIMATELY 13 MILES).

"/5) IN VIEW OF THE ABOVE, IT WAS CONCLUDED THAT THE BID IN QUESTION COULD BE REJECTED AS UNREASONABLE UNDER PROVISIONS OF APP 2 403 F.

"/6) IT WAS FURTHER DETERMINED THAT THE NEXT HIGHER BID COULD BE ACCEPTED AND AWARD MADE ON THOSE ITEMS WHICH THE CONTRACTING OFFICER CONSIDERED REASONABLE, AND IF ALL ITEMS WERE CONSIDERED REASONABLE, AWARD FOR ALL ITEMS COULD BE MADE.'

YOUR PROTEST ALSO PRESENTS THE FOLLOWING ADDITIONAL CONTENTIONS:

1. THE COMPANY WHICH WAS AWARDED THE CONTRACT HAS NEVER PERFORMED THE WORK CALLED FOR UNDER THE CONTRACT.

2. THE SUCCESSFUL BIDDER AT THE TIME OF AWARD HAD NO INVESTMENT IN MATERIALS OR EQUIPMENT WITH WHICH TO PERFORM THE CONTRACT.

3. THE COMPANY WHICH WAS AWARDED THE CONTRACT IS BEING FURNISHED PACKING AND CRATING MATERIALS TO ENABLE IT TO PERFORM THE WORK, DUE TO THE FACT THAT THE CONTRACTOR CANNOT FURNISH THE ATERIALS; ALSO, THE CONTRACTOR'S EQUIPMENT (TRUCKS, ETC.) IS RENTED AND NOT OWNED.

4. THE SUBJECT CONTRACT IS BEING PERFORMED BY THE SAME PEOPLE WHO HAVE THE ARMY STEVEDORING CONTRACT, GIVING IT AN UNFAIR ADVANTAGE IN THE USE OF GOVERNMENT EQUIPMENT AND STEVEDORING PERSONNEL IN PERFORMING UNLOADING AND LOADING OPERATIONS AT THE ARMY TERMINAL.

WITH RESPECT TO YOUR FIRST CONTENTION, IT IS REPORTED THAT SAN JUAN TRUCKING ENTERPRISE, INC., IS FULLY QUALIFIED TO PERFORM THE TRANSPORTATION SERVICES, AND THAT THE MINIMUM TECHNICAL KNOWLEDGE REQUIRED FOR ACCOMPLISHMENT OF THE PACKING AND CRATING OPERATIONS--- SPECIFICATIONS AND PROCEDURES FOR WHICH ARE FULLY OUTLINED IN THE GOVERNMENT'S TECHNICAL MANUAL--- WAS IMMEDIATELY ACQUIRED BY THE CONTRACTOR, WHICH HAS ALSO EMPLOYED PERSONNEL EXPERIENCED IN THOSE OPERATIONS.

YOUR SECOND CONTENTION IS NOT SUPPORTED BY THE RECORD WHICH DISCLOSES THAT TRANS-CARIBBEAN MOTOR TRANSPORT, INC., HAS MADE FIRM COMMITMENTS TO SAN JUAN TRUCKING ENTERPRISE, INC., TO FURNISH AND MAKE AVAILABLE THE USE OF SUCH ROLLING EQUIPMENT AS WOULD BE REQUIRED FOR THE TRANSPORTATION OF HOUSEHOLD GOODS UNDER THE DEPARTMENT OF THE ARMY CONTRACT FOR FISCAL YEAR 1956. ALSO, A PRE-AWARD SURVEY REVEALED THAT THE SUCCESSFUL BIDDER OWNED MOBILE EQUIPMENT VALUED AT SEVERAL THOUSAND DOLLARS AND THAT THE COMPANY WAS RELIABLE AND FINANCIALLY RESPONSIBLE.

IN ANSWER TO YOUR THIRD CONTENTION, IT IS REPORTED THAT THE MATERIAL WAS NOT OFFERED TO THE CONTRACTOR FOR THE PURPOSE OF ENABLING IT TO PERFORM THE WORK, BUT RATHER BECAUSE THERE WAS ON HAND A SUPPLY OF SUCH MATERIAL WHICH WAS SURPLUS TO THE NEEDS OF THE SERVICE. IT WAS THEREFORE CONSIDERED TO BE IN THE BEST INTEREST OF THE GOVERNMENT TO FURNISH IT ON A REIMBURSABLE BASIS SO AS TO REDUCE THE COSTS UNDER THE CONTRACT. SINCE THE GOVERNMENT IS CONCERNED ONLY WITH THE SATISFACTORY PERFORMANCE OF THE CONTRACT, THE FACT THAT SOME OF THE EQUIPMENT USED BY THE CONTRACTOR IS RENTED IS IMMATERIAL.

REGARDING YOUR FOURTH CONTENTION, THE REPORT OF SEPTEMBER 28, 1955, STATES:

"1. WITH REFERENCE TO PAR C. PAGE 2 OF LETTER, ALTHOUGH THE SAN JUAN ENTERPRISE, INC. IS ESSENTIALLY OPERATED BY THE SAME DIRECTORS AS THE SAN JUAN COMMERCIAL COMPANY, INC., WHICH HANDLES THE ARMY STEVEDORING CONTRACT, BOTH ARE SEPARATE CORPORATIONS WITH INDEPENDENT CHARTERS ON FILE WITH THE COMMONWEALTH GOVERNMENT OF PUERTO RICO. UNDER UNUSUAL, EMERGENCY, AND EXCEPTIONAL CIRCUMSTANCES, WHEN IN THE BEST INTEREST OF THE GOVERNMENT, THE PACKING AND CRATING CONTRACTOR HAS BEEN PERMITTED TO USE A GOVERNMENT FORKLIFT IN THE PERFORMANCE OF INDIVIDUAL JOBS, UNDER THE PACKING AND CRATING CONTRACT. HOWEVER, THE OPERATOR WAS PROVIDED AND PAID FOR BY THE PACKING AND CRATING CONTRACTOR. THESE ISOLATED AUTHORIZATIONS TO USE GOVERNMENT EQUIPMENT WERE GRANTED ONLY FOR THE CONVENIENCE OF THE GOVERNMENT TO EXPEDITE THE MOVEMENT OF A BACKLOG OF HOUSEHOLD GOODS NOT CAUSED BY THIS CONTRACTOR AND NOT FOR THE CONVENIENCE OF THE CONTRACTOR.

FINALLY, IT IS REPORTED THAT A CAREFUL STUDY OF BILLS RECEIVED AND PAID REVEALS NOT ONE INSTANCE OF OVERLAPPING PAYMENTS IN THE PERFORMANCE "AT THE SAME TIME" OF THE PACKING AND CRATING OPERATIONS AND STEVEDORING.

IN THE INSTANT CASE YOUR BID WAS REJECTED ON THE BASIS OF AN ADMINISTRATIVE DETERMINATION, UNDER THE ABOVE-QUOTED PROVISIONS OF THE CONTRACT AND APPLICABLE PROCUREMENT INSTRUCTIONS, THAT IT WAS UNREASONABLE AND INDICATED THAT IT WAS MADE EITHER BY MISTAKE, UNDER BAD FAITH, OR BY AN UNREASONABLE BIDDER. CONTRACTING OFFICERS NECESSARILY ARE VESTED WITH A CERTAIN AMOUNT OF DISCRETION, AND THEIR BONA FIDE DETERMINATIONS AS TO RESPONSIVENESS OF BIDS AND RESPONSIBILITY OF BIDDERS--- MATTERS PRIMARILY FOR ADMINISTRATIVE DETERMINATION--- MAY BE QUESTIONED ONLY WHERE THEY ARE NOT SUPPORTED BY SUBSTANTIAL EVIDENCE. IN THIS INSTANCE WE FIND NO LACK OF SUCH EVIDENCE.

IN THE CIRCUMSTANCES, IT MUST BE CONCLUDED THAT YOUR PROTEST FURNISHES NO PROPER BASIS ON WHICH WE WOULD BE JUSTIFIED IN HOLDING THAT THE ADMINISTRATIVE ACTION WAS ILLEGAL OR IMPROPER.