B-130060, JAN. 11, 1957

B-130060: Jan 11, 1957

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TO LEGION UTENSILS CO.: FURTHER REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 11. YOU STATE YOU HAVE INVESTIGATED THE EXPERIENCE AND ABILITY OF THE AMERICAN AIR PRODUCTS CORPORATION AND THAT. YOU ARE CONFIDENT THAT THE CORPORATION IS NOT IN A POSITION TO FURNISH THE STERILIZERS WITHIN THE TIME REQUIRED. YOU STATE ALSO THAT THE CORPORATION NOT ONLY HAS NO PLANT FACILITY WHICH WOULD BE REQUIRED TO MANUFACTURE THE STERILIZERS BUT DOES NOT HAVE THE EXPERIENCE IN THIS PARTICULAR TYPE OF MANUFACTURING TO ENABLE IT TO DO THE JOB. ARMED SERVICES MEDICAL PROCUREMENT AGENCY REVEALS THAT 7 BIDS WERE RECEIVED OFFERING TO FURNISH THE STERILIZERS COVERED BY ITEM NO. 3 WHICH WERE FOR USE BY THE FEDERAL CIVIL DEFENSE ADMINISTRATION.

B-130060, JAN. 11, 1957

TO LEGION UTENSILS CO.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 11, 1956, WITH ENCLOSURE, PROTESTING THE AWARD OF ANY CONTRACT BY THE ARMED SERVICES MEDICAL PROCUREMENT AGENCY, BROOKLYN, NEW YORK, ON BID SUBMITTED BY THE AMERICAN AIR PRODUCTS CORPORATION IN RESPONSE TO INVITATION NO. NPA-30 287 -MD-57-463 WHICH REQUESTED BIDS FOR FURNISHING 6,040 SURGICAL INSTRUMENT STERILIZERS UNDER ITEM NO. 3 OF THE BID SCHEDULE.

YOU STATE YOU HAVE INVESTIGATED THE EXPERIENCE AND ABILITY OF THE AMERICAN AIR PRODUCTS CORPORATION AND THAT, BASED UPON YOUR OWN KNOWLEDGE AS A COMPANY WELL RECOGNIZED IN THE FIELD OF DEEP DRAWING STAINLESS STEEL, YOU ARE CONFIDENT THAT THE CORPORATION IS NOT IN A POSITION TO FURNISH THE STERILIZERS WITHIN THE TIME REQUIRED. YOU STATE ALSO THAT THE CORPORATION NOT ONLY HAS NO PLANT FACILITY WHICH WOULD BE REQUIRED TO MANUFACTURE THE STERILIZERS BUT DOES NOT HAVE THE EXPERIENCE IN THIS PARTICULAR TYPE OF MANUFACTURING TO ENABLE IT TO DO THE JOB.

A CAREFUL REVIEW OF THE RECORD AS PRESENTED TO OUR OFFICE BY THE CHIEF, ARMED SERVICES MEDICAL PROCUREMENT AGENCY REVEALS THAT 7 BIDS WERE RECEIVED OFFERING TO FURNISH THE STERILIZERS COVERED BY ITEM NO. 3 WHICH WERE FOR USE BY THE FEDERAL CIVIL DEFENSE ADMINISTRATION. THE BID OF THE AMERICAN AIR PRODUCTS CORPORATION WAS THE LOWEST RECEIVED. THE BID OF THE BRAMSON ENGINEERING COMPANY WAS THE NEXT-LOWEST RECEIVED BUT THAT BIDDER STIPULATED THAT ITS PRICE WAS BASED UPON FURNISHING AT LEAST 50 PERCENT OF THE QUANTITY SPECIFIED.

AS A MEANS OF ASCERTAINING THE CAPABILITIES OF THE TWO LOWEST BIDDERS FACILITY SURVEYS WERE MADE OF BOTH BIDDERS. IT WAS FOUND THAT THE AMERICAN AIR PRODUCTS CORPORATION FACILITY WAS FORMERLY THE MCGRATH ST. PAUL COMPANY LOCATED IN ST. PAUL, MINNESOTA, AND ITS AFFILIATE, THE VALLEY FORGE CAR COMPANY LOCATED IN STILLWATER, MINNESOTA. THE MCGRATH ST. PAUL COMPANY, WHICH WAS ESTABLISHED IN 1935, WAS ENGAGED IN THE MANUFACTURE OF PRECISION TOOLS AND EQUIPMENT. THE VALLEY FORGE CAR COMPANY WAS ENGAGED IN THE MANUFACTURE OF COFFEE MAKERS, SOUP KITCHENS, AND ELECTRIC SOUP CUPS, ALL MADE OF STAINLESS STEEL, AND IN THE MANUFACTURE OF VARIOUS FORGED AND BLANKED ITEMS ON GOVERNMENT CONTRACTS. IN JUNE 1955 THE FACILITIES OF THE VALLEY FORGE PLANT WERE DESTROYED BY FIRE BUT MOST OF THE EQUIPMENT WAS SALVAGED. AFTER THE FIRE MR. MCGRATH RELOCATED IN FORT LAUDERDALE, FLORIDA, AND ALL EQUIPMENT OWNED BY THE MCGRATH ST. PAUL COMPANY WAS TRANSFERRED TO THE AMERICAN AIR PRODUCTS COMPANY IN THAT CITY.

THE SURVEYING OFFICER VISITED THE FACILITY AT FORT LAUDERDALE TO DETERMINE WHETHER THE AMERICAN AIR PRODUCTS COMPANY WAS IN A POSITION TO FURNISH THE STERILIZERS AND IT WAS ASCERTAINED THAT THE FACILITY HAD VERBAL COMMITMENTS FOR THE STAINLESS STEEL AND BURNERS THAT WOULD BE REQUIRED. IT WAS ALSO FOUND THAT ARRANGEMENTS WERE MADE WITH A SUBCONTRACTOR TO FABRICATE THE NECESSARY DIES. ALTHOUGH AT THE TIME OF THE SURVEY THE EQUIPMENT AT THE PLANT IN FORT LAUDERDALE WAS LIMITED, EQUIPMENT WAS AVAILABLE AT ST. PAUL. IT WAS ALSO ASCERTAINED THAT, ALTHOUGH THE LABOR FORCE AT THE FORT LAUDERDALE PLANT WAS SMALL, AN EXCELLENT LABOR SOURCE WAS AVAILABLE. THE RECOMMENDATION OF THE SURVEYING OFFICER READS AS FOLLOWS:

"WHILE THE SUBJECT FIRM QUALIFIES AS A SOURCE OF SUPPLY UNDER THE PROVISIONS OF ASPR 1-201.9 FOR ITEM NUMBER 6530-708-4735, THE SUBJECT FIRM HAS NOT AS YET DEMONSTRATED, UNDER THEIR NEW ORGANIZATION, THEIR CAPABILITY OF HANDLING A CONTRACT OF THE SIZE AND MAGNITUDE OF BID INVITATION NUMBER MPA-30-287-MD-57-436. IT IS THEREFORE RECOMMENDED THAT THE CONTRACTING OFFICER CONSIDER THE FEASIBILITY OF MAKING A SPLIT AWARD TO INSURE THE BEST INTERESTS OF THE GOVERNMENT BEING UPHELD.'

FOLLOWING RECEIPT OF THE REPORT OF THE SURVEY AND THE QUOTED RECOMMENDATION AND AFTER EVALUATION OF ALL MATERIAL AVAILABLE AND IN THE INTEREST OF SMALL BUSINESS, THE CONTRACTING OFFICER AWARDED A CONTRACT TO THE AMERICAN AIR PRODUCTS CORPORATION FOR 2,040 OF THE STERILIZERS AND A CONTRACT TO THE BRAMSON ENGINEERING COMPANY FOR THE BALANCE OF 4,000.

THE DETERMINATION AS TO WHETHER A BIDDER IS QUALIFIED IS PRIMARILY THE RESPONSIBILITY OF THE ADMINISTRATIVE AGENCY CONCERNED AND IN THE ABSENCE OF ANY SHOWING OF BAD FAITH OR LACK OF A REASONABLE FACTUAL BASIS FOR THE DETERMINATION MADE, WE ARE NOT REQUIRED TO OBJECT TO THE ACTION TAKEN ON THE BASIS THEREOF. ON THE RECORD NOW BEFORE US, WE FIND NO BASIS FOR DISTURBING THE AWARDS MADE TO THE TWO BIDDERS.