B-146229, SEP. 1, 1961

B-146229, SEP. 1, 1961

TO SCHAEVITZ MACHINE WORKS:

BY TELEGRAM DATED JUNE 23, 1961, YOU PROTESTED AGAINST THE AWARD OF A CONTRACT TO ANOTHER BIDDER UNDER INVITATION FOR BIDS NO. 42-600-61 234 ISSUED BY THE OGDEN AIR MATERIEL AREA ON APRIL 24, 1961.

THE INVITATION REQUESTED BIDS ON A HUMAN CENTRIFUGE IN ACCORDANCE WITH SPECIFICATION MIL-C-27607, SPARE PARTS, AND RELATED WRITTEN MATERIAL. REQUIRED THAT THE "J" BOLTS AND TEMPLATE FOR THE BASE RING OF THE CENTRIFUGE BE DELIVERED BY JUNE 15, 1961, IF AWARD WAS MADE BY MAY 25, 1961, AS CONTEMPLATED. HOWEVER, IF AWARD WAS MADE AT A SUBSEQUENT DATE THE DELIVERY SCHEDULE WAS TO BE EXTENDED DAY BY DAY BY THE NUMBER OF DAYS AWARD WAS DELAYED BEYOND MAY 25.

TWO BIDS WERE RECEIVED AND OPENED ON MAY 15, 1961, AS SCHEDULED, FROM THE RUCKER COMPANY AND YOUR COMPANY--- SMALL BUSINESS CONCERNS--- IN THE AGGREGATE AMOUNTS OF $298,316 AND $280,634, RESPECTIVELY. SINCE YOUR COMPANY HAD SUBMITTED THE LOWEST APPARENT BID, A PREAWARD SURVEY WAS CONDUCTED OF YOUR CAPABILITIES TO PERFORM THE RESULTING CONTRACT. ON MAY 31, 1961, AN ADVERSE FACILITIES CAPABILITY REPORT WAS RECEIVED BY THE PROCUREMENT OFFICE AS TO YOUR CAPABILITIES, THE REPORT SHOWING THAT YOUR COMPANY WOULD BE UNABLE TO MEET THE DELIVERY SCHEDULE FOR "J" BOLTS AND TEMPLATE FOR THE BASE RING OF THE CENTRIFUGE SINCE YOUR DESIGN DIFFERED FROM THE REQUIREMENTS OF THE SPECIFICATION. THAT SAME DAY--- MAY 31, 1961 --- THE SMALL BUSINESS ADMINISTRATION WAS ADVISED OF THE ADVERSE PREAWARD SURVEY IN ACCORDANCE WITH SECTION 1-705.6 (B), ASPR, WHICH READS AS FOLLOWS:

"IF A SMALL BUSINESS CONCERN HAS SUBMITTED AN OTHERWISE ACCEPTABLE BID OR PROPOSAL BUT HAS BEEN FOUND BY THE CONTRACTING OFFICER TO BE NONRESPONSIBLE AS TO CAPACITY OR CREDIT, AND IF THE BID OR PROPOSAL IS TO BE REJECTED FOR THIS REASON ALONE, (I) SBA SHALL BE NOTIFIED OF THE CIRCUMSTANCES SO AS TO PERMIT IT TO ISSUE A CERTIFICATE OF COMPETENCY, AND (II) AWARD SHALL BE WITHHELD PENDING EITHER SBA ISSUANCE OF A CERTIFICATE OF COMPETENCY OR THE EXPIRATION OF TEN WORKING DAYS AFTER SBA IS SO NOTIFIED, WHICHEVER IS EARLIER, * * *.'

SINCE ELEVEN WORKING DAYS HAD ELAPSED AFTER MAY 31 WITHOUT ADVICE FROM SBA AS TO WHETHER OR NOT A CERTIFICATE OF COMPETENCY WOULD BE ISSUED, AWARD WAS MADE TO THE RUCKER COMPANY ON JUNE 15, 1961, AS THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER UNDER THE INVITATION.

IN A LETTER DATED JUNE 23, 1961, TO THE HONORABLE WILLIAM T. CAHILL, HOUSE OF REPRESENTATIVES, A COPY OF WHICH WAS FURNISHED TO OUR OFFICE, YOUR COMPANY ALLEGES THAT AWARD WAS MADE PRIOR TO EXPIRATION OF THE 10-DAY PERIOD ALLOTTED TO SBA FOR THE PURPOSES OF DETERMINING WHETHER A CERTIFICATE OF COMPETENCY SHOULD BE ISSUED. AS ABOVE STATED, AWARD WAS MADE TO THE RUCKER COMPANY ON JUNE 15, 1961--- 11 WORKING DAYS AFTER THE SBA WAS ADVISED OF YOUR COMPANY'S NONRESPONSIBILITY. THIS FACT IS EVIDENCED BY THE STATEMENT AND CERTIFICATE OF AWARD EXECUTED BY THE CONTRACTING OFFICER PURSUANT TO THE PROVISIONS OF SECTION 2-407.7, ASPR, AND 10 U.S.C. 2305 (C).

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

YOUR COMPANY ALSO TAKES ISSUE WITH THE ADMINISTRATIVE DETERMINATION OF NONRESPONSIBILITY. THERE CAN BE NO DOUBT THAT UNDER THE REGULATION CITED ABOVE, AS WELL AS THE APPLICABLE SBA REGULATION CODIFIED AT 13 CFR 124.8- 16 (A), THE PROCUREMENT AGENCY WAS OBLIGED TO WITHHOLD AWARD ONLY FOR 10 WORKING DAYS. THEREAFTER IT WAS ENTITLED TO MAKE A VALID AWARD TO THAT BIDDER ADMINISTRATIVELY DETERMINED TO BE THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER IN THE ABSENCE OF A CERTIFICATE OF COMPETENCY ISSUED DURING THAT PERIOD OR AN EXTENSION THEREOF GRANTED BY THE PROCUREMENT AGENCY. WHEN A CERTIFICATE OF COMPETENCY IS NOT ISSUED WITHIN THE PERIOD FIXED BY THE REGULATION, THE CONTRACTING OFFICER'S DETERMINATION OF NONRESPONSIBILITY MUST BE REGARDED AS CONTROLLING. WE HAVE NO AUTHORITY TO REVIEW THE FACTS INVOLVED IN RESPECT TO THE FAILURE OF SBA TO ISSUE A CERTIFICATE OF COMPETENCY HERE OR TO REQUIRE THAT AGENCY TO ISSUE SUCH A CERTIFICATE. NEITHER MAY WE OBJECT TO THE DETERMINATION OF A CONTRACTING OFFICER AS TO A PROSPECTIVE CONTRACTOR'S ABILITY TO PERFORM IN THE ABSENCE OF A SHOWING OF BAD FAITH OR LACK OF A REASONABLE BASIS THEREFOR. COMP. GEN. 705.

MOREOVER, IT APPEARS THAT YOUR BID WAS NONRESPONSIVE TO THE ADVERTISED SPECIFICATIONS. ATTACHED TO YOUR BID WAS A "TECHNICAL ANALYSIS OF HUMAN CENTRIFUGE AF37U-1" WHEREIN DEVIATIONS FROM THE SPECIFICATIONS WERE OUTLINED IN DETAIL. IT WAS STATED THEREIN THAT:

"THE ABOVE SPECIFICATION IS REVIEWED HEREIN, WITH COMMENTS ON THE MANNER IN WHICH SCHAEVITZ ENGINEERING PROPOSED TO COMPLY WITH THE SPECIFICATION, AND CLARIFICATIONS OR EXCEPTIONS ON THOSE POINTS WHERE THESE APPEAR APPLICABLE. THE NUMBER REFERENCES REFER TO THE PARAGRAPHS IN THE REFERENCED SPECIFICATION IN ORDER TO FACILITATE REFERENCE AND CORRELATION OF THE REMARKS WITH THE SPECIFICATION. THIS ANALYSIS PROVIDES GENERAL COMPLIANCE WITH THE INTENT AND PURPOSE OF THE SPECIFICATION, ALTHOUGH THERE ARE DIFFERENCES IN SOME INSTANCES FOR THE PURPOSE OF MAKING A CONVENIENT, PRACTICAL AND ECONOMICAL TEST FACILITY. COMMENTS ARE MADE ONLY WHERE IT IS FELT THEY ARE APPLICABLE.'

IT IS THUS INDICATED THAT YOUR BID WAS NOT ENTIRELY RESPONSIVE TO THE INVITATION AND COULD NOT HAVE BEEN ACCEPTED BY THE GOVERNMENT WITHOUT DOING VIOLENCE TO THE COMPETITIVE BIDDING SYSTEM. THE ADMINISTRATIVE REPORT IS TO THE EFFECT THAT SUCH DEVIATIONS AS WERE PROPOSED BY YOU WERE SUBSTANTIAL IN THAT THEY AFFECTED THE QUALITY OF THE ITEM ADVERTISED. HAVE HELD THAT SUCH DEVIATIONS MAY NOT BE WAIVED TO THE PREJUDICE OF OTHER RESPONSIVE BIDDERS. 30 COMP. GEN. 179.

ACCORDINGLY, WE FIND NO LEGAL BASIS TO QUESTION THE AWARD MADE TO THE RUCKER COMPANY.