B-135718, MAY 28, 1958, 37 COMP. GEN. 798

B-135718: May 28, 1958

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BIDDERS - QUALIFICATIONS - ADMINISTRATIVE DETERMINATION - CERTIFICATES OF COMPETENCY THE REJECTION OF A LOW BID AFTER A DETERMINATION THAT THE BIDDER WAS NOT RESPONSIBLE BASED ON INFORMATION FROM ANOTHER OFFICE THAT THE WORK OF THE BIDDER ON CURRENT CONTRACTS WAS UNSATISFACTORY AND DELINQUENT WAS NOT IMPROPER. EVEN THOUGH INFORMATION FROM OTHER SOURCES MIGHT HAVE INDICATED SATISFACTORY PERFORMANCE. THE DETERMINATION OF A BIDDER'S QUALIFICATIONS IS PRIMARILY A MATTER FOR THE PROCUREMENT AGENCY AND. THERE IS NO BASIS TO DISTURB AN AWARD TO THE NEXT LOWEST BIDDER. IS CONCLUSIVE UPON CONTRACTING OFFICERS ONLY AS TO THE BIDDER'S CAPACITY AND CREDIT AND. THE FACT THAT A LOW BIDDER WHO WAS DETERMINED NOT TO BE RESPONSIBLE BECAUSE OF UNSATISFACTORY CONTRACT PERFORMANCE COULD HAVE OBTAINED A CERTIFICATE OF COMPETENCY IS NOT MATERIAL TO THE DETERMINATION.

B-135718, MAY 28, 1958, 37 COMP. GEN. 798

BIDDERS - QUALIFICATIONS - ADMINISTRATIVE DETERMINATION - CERTIFICATES OF COMPETENCY THE REJECTION OF A LOW BID AFTER A DETERMINATION THAT THE BIDDER WAS NOT RESPONSIBLE BASED ON INFORMATION FROM ANOTHER OFFICE THAT THE WORK OF THE BIDDER ON CURRENT CONTRACTS WAS UNSATISFACTORY AND DELINQUENT WAS NOT IMPROPER, EVEN THOUGH INFORMATION FROM OTHER SOURCES MIGHT HAVE INDICATED SATISFACTORY PERFORMANCE, THE DETERMINATION OF A BIDDER'S QUALIFICATIONS IS PRIMARILY A MATTER FOR THE PROCUREMENT AGENCY AND, IN THE ABSENCE OF EVIDENCE OF BAD FAITH OR THE LACK OF A REASONABLE BASIS FOR THE DETERMINATION, THERE IS NO BASIS TO DISTURB AN AWARD TO THE NEXT LOWEST BIDDER. THE ISSUANCE OF A CERTIFICATE OF COMPETENCY TO A BIDDER BY THE SMALL BUSINESS ADMINISTRATION, PURSUANT TO 15 U.S.C. 642, IS CONCLUSIVE UPON CONTRACTING OFFICERS ONLY AS TO THE BIDDER'S CAPACITY AND CREDIT AND, THEREFORE, THE FACT THAT A LOW BIDDER WHO WAS DETERMINED NOT TO BE RESPONSIBLE BECAUSE OF UNSATISFACTORY CONTRACT PERFORMANCE COULD HAVE OBTAINED A CERTIFICATE OF COMPETENCY IS NOT MATERIAL TO THE DETERMINATION.

TO CURTIS L. RUDOLPH, MAY 28, 1958:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF APRIL 1, 1958, PROTESTING AGAINST THE AWARD OF A CONTRACT UNDER INVITATION FOR BIDS NO. AIV-41-184- 58-ENG-16 OPENED AT CAMP WOLTERS, TEXAS, ON FEBRUARY 21, 1958.

THE INVITATION DATED JANUARY 22, 1958, REQUESTED BIDS FOR FURNISHING THE NECESSARY SUPPLIES AND SERVICES TO REPAIR OR REPLACE FLOOR JOISTS, SILLS AND HEADINGS IN CERTAIN WAREHOUSE BUILDINGS AT CAMP WOLTERS. AS YOUR BID IN THE AMOUNT OF $33,669 WAS THE APPARENTLY LOWEST BID RECEIVED, THE CONTRACTING OFFICER INITIATED A PREAWARD SURVEY TO DETERMINE YOUR RESPONSIBILITY AS A GOVERNMENT CONTRACTOR. ON THE BASIS OF INFORMATION FURNISHED BY YOU, THE CONTRACTING OFFICER CONTRACTED FORT LEE, VIRGINIA, TO ASCERTAIN YOUR PRIOR PERFORMANCE RECORD UNDER CONTRACTS WITH THAT INSTALLATION. FORT LEE ADVISED THAT, IN ITS OPINION, YOU WERE NOT CONSIDERED A RELIABLE FIRM ON THE BASIS OF YOUR CURRENT CONTRACT PERFORMANCE, AND THAT OUT OF FOUR CONTRACTS, YOU WERE 37 DAYS DELINQUENT ON ONE; THAT YOUR PERFORMANCE OF AN OPEN END CONTRACT FOR REFINISHING FLOORS WAS CONSIDERED TO BE UNSATISFACTORY; AND THAT FOR THE OTHER TWO CONTRACTS, YOUR PERFORMANCE WAS PROGRESSING IN A SATISFACTORY MANNER. THE BASIS OF THIS INFORMATION, THE CONTRACTING OFFICER DETERMINED THAT HE COULD NOT AFFIRMATIVELY REGARD YOU AS A RESPONSIBLE BIDDER. THEREFORE, IN VIEW OF THE LOW DOLLAR VALUE OF THE PROPOSED CONTRACT, NO FURTHER PREAWARD SURVEY WAS CONDUCTED AS TO YOUR PREVIOUS PERFORMANCE RECORD. THE DETERMINATION OF THE CONTRACTING OFFICER IN THAT REGARD AND HIS PROPOSAL TO AWARD THE CONTRACT TO THE NEXT LOWEST BIDDER WAS AFFIRMED BY HIGHER HEADQUARTERS WHICH AUTHORIZED REJECTION OF YOUR BID. ON MARCH 17, 1958, THEREFORE, THE CONTRACT WAS AWARDED TO C. E. SMALL FOR $37,568.

YOU CONTEND, IN EFFECT, THAT THE CONTRACTING OFFICER SHOULD NOT HAVE RELIED SOLELY UPON THE INFORMATION FROM FORT LEE SINCE YOUR PERFORMANCE RECORD AT OTHER INSTALLATIONS IS SATISFACTORY.

IN THAT CONNECTION, THE DEPARTMENT OF THE ARMY ADVISED US THAT---

SUBSEQUENT TO THE AWARD OF THE CONTRACT AND THE RECEIPT OF YOUR INQUIRY IT WAS LEARNED THAT THE PROTESTING BIDDER HAD PERFORMED GOVERNMENT CONTRACTS OTHER THAN AT FORT LEE IN AN APPARENTLY SATISFACTORY MANNER. THIS CONNECTION IT IS RECOGNIZED THAT IN THE INSTANT CASE THE CONTRACTING OFFICER COULD HAVE, THROUGH THE EXERCISE OF GREATER DILIGENCE, OBTAINED SUCH INFORMATION PRIOR TO THE REJECTION OF THE PROTESTING BIDDER. WHETHER SUCH ADDITIONAL INFORMATION, EVEN HAD IT BEEN RECEIVED PRIOR TO AWARD, WOULD HAVE ALTERED THE DETERMINATION OF THE CONTRACTING OFFICER IN VIEW OF THE ADVICE RECEIVED FROM FORT LEE, VIRGINIA, IS QUESTIONABLE. IN ALL SUCH CASES IT IS NECESSARILY A QUESTION OF JUDGMENT AS TO THE AMOUNT OF ADMINISTRATIVE EXPENSES WHICH SHOULD BE INCURRED IN CONTRACTING ALL POSSIBLE SOURCES OF INFORMATION AS TO THE PRIOR PERFORMANCE OF A POTENTIAL CONTRACTOR, AS COMPARED TO THE VALUE OF THE CONTRACT TO BE AWARDED. THIS ADDITIONAL INFORMATION, OF COURSE, HAS BEEN FORWARDED TO THE CONTRACTING OFFICER AND WILL BE CONSIDERED BY HIM IN ANY FUTURE PROCUREMENTS ON WHICH VETERAN SERVICE MAY BID.

THE QUESTION AS TO THE QUALIFICATIONS OF A PROPOSED CONTRACTOR IS PRIMARILY THE FUNCTION OF THE PROCUREMENT AGENCY AND, IN THE ABSENCE OF CONVINCING EVIDENCE OF BAD FAITH OR OF A REASONABLE BASIS FOR THE DETERMINATION AS MADE, WE ARE NOT REQUIRED TO OBJECT TO THE DETERMINATION. IN THIS CASE, SINCE THE DEPARTMENT OF THE ARMY HAS DETERMINED AFTER A CAREFUL INVESTIGATION AND FULL CONSIDERATION OF ITS PRIOR RECORD THAT YOUR BID MUST BE REJECTED ON THE BASIS OF RESPONSIBILITY, WE FIND NO LEGAL BASIS TO DISTURB THE AWARD.

IT IS FURTHER CONTENDED BY YOU THAT THE CONTRACTING OFFICER SHOULD HAVE SUBMITTED THE MATTER OF YOUR ELIGIBILITY FOR AWARD TO THE SMALL BUSINESS ADMINISTRATION FOR ITS DETERMINATION WHETHER A CERTIFICATE OF COMPETENCY SHOULD BE ISSUED. IT IS TO BE NOTED THAT A CERTIFICATE OF COMPETENCY ISSUED BY THE SMALL BUSINESS ADMINISTRATION IS CONCLUSIVE UPON CONTRACTING OFFICERS AS TO A FIRM'S ,CAPACITY AND CREDIT.' SEE SECTION 213 OF THE SMALL BUSINESS ACT, 15 U.S.C. 642. HOWEVER, NO QUESTION WAS RAISED IN EVALUATING YOUR BID AS TO YOUR CAPACITY OR CREDIT BUT ONLY AS TO YOUR PRIOR CONTRACT PERFORMANCES. OUR OFFICE IS OF THE VIEW THAT THE CERTIFICATION OF A FIRM AS TO CAPACITY AND CREDIT IS CONCLUSIVE ONLY INSOFAR AS IT CONFLICTS WITH A DETERMINATION BY A PROCUREMENT OFFICER AS TO THE "CAPACITY OR CREDIT" OF A BIDDER. HOWEVER, WHERE AS HERE A BIDDER IS FOUND NOT TO BE QUALIFIED BECAUSE OF PRIOR UNSATISFACTORY CONTRACT PERFORMANCE, THE CERTIFICATE OF COMPETENCY, BEING LIMITED TO "CAPACITY AND CREDIT," COULD NOT BE DETERMINATIVE OF THE AWARD TO BE MADE.

ACCORDINGLY, WE FIND NO SUBSTANTIAL LEGAL BASIS TO QUESTION THE AWARD MADE UNDER INVITATION FOR BIDS NO. AIV-41-184-58-ENG-16.