B-147995, FEB. 14, 1962

B-147995: Feb 14, 1962

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TO COMPUTER DYNAMICS CORPORATION: REFERENCE IS MADE TO YOUR LETTER OF JANUARY 19. THE CONTRACT WAS BEING CONCLUDED. IT BECAME EVIDENT THAT A FURTHER AND BROADER TEST WAS NEEDED IN ORDER TO MAKE IT APPLICABLE ON A NATIONWIDE BASIS. PROPOSALS WERE SOLICITED FROM THE SEVEN FIRMS WHICH HAD EXPRESSED INTEREST IN THE WORK WHEN THE SEPTEMBER CONTRACT WAS NEGOTIATED. A MEETING WAS HELD WITH REPRESENTATIVES OF THE SEVEN FIRMS ON DECEMBER 28. AT WHICH TIME THE REQUIREMENTS WERE OUTLINED AND COPIES OF TWO DOCUMENTS SETTING OUT SUCH REQUIREMENTS AND A BID SCHEDULE WERE DISTRIBUTED. THE REPRESENTATIVES WERE INFORMED THAT THE CONTRACT WOULD BE NEGOTIATED. THAT QUALITY AND PROMPTNESS OF THE WORK WERE OF PRIME IMPORTANCE AND THAT WHILE PRICE WAS IMPORTANT IT WAS NOT NECESSARILY THE CONTROLLING FACTOR.

B-147995, FEB. 14, 1962

TO COMPUTER DYNAMICS CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF JANUARY 19, 1962, WITH ENCLOSURES, PROTESTING THE REJECTION OF YOUR BID ON A REQUEST FOR PROPOSALS FOR PROCESSING DATA FOR THE SOIL CONSERVATION SERVICE, DEPARTMENT OF AGRICULTURE, ISSUED ON JANUARY 4, 1962.

THE SOIL CONSERVATION SERVICE NEGOTIATED A CONTRACT IN SEPTEMBER 1961 WITH ERNEST E. BLANCHE AND ASSOCIATES, INC., TO MAKE A TEST RUN ON A FIVE- STATE BASIS IN ORDER TO TEST PROCESSING PROCEDURES TO DETERMINE WHETHER THIS WOULD RESULT IN ECONOMICS OR IMPROVEMENT IN EFFICIENCY OR BOTH. THE CONTRACT WAS BEING CONCLUDED, IT BECAME EVIDENT THAT A FURTHER AND BROADER TEST WAS NEEDED IN ORDER TO MAKE IT APPLICABLE ON A NATIONWIDE BASIS. ACCORDINGLY, PROPOSALS WERE SOLICITED FROM THE SEVEN FIRMS WHICH HAD EXPRESSED INTEREST IN THE WORK WHEN THE SEPTEMBER CONTRACT WAS NEGOTIATED. A MEETING WAS HELD WITH REPRESENTATIVES OF THE SEVEN FIRMS ON DECEMBER 28, 1961, AT WHICH TIME THE REQUIREMENTS WERE OUTLINED AND COPIES OF TWO DOCUMENTS SETTING OUT SUCH REQUIREMENTS AND A BID SCHEDULE WERE DISTRIBUTED. THE REPRESENTATIVES WERE INFORMED THAT THE CONTRACT WOULD BE NEGOTIATED, THAT QUALITY AND PROMPTNESS OF THE WORK WERE OF PRIME IMPORTANCE AND THAT WHILE PRICE WAS IMPORTANT IT WAS NOT NECESSARILY THE CONTROLLING FACTOR. THE DATE OF JANUARY 12, 1962, WAS SET AS A DEADLINE FOR SUBMITTING PROPOSALS. YOU WERE NOT REPRESENTED AT THE MEETING OF DECEMBER 28 NOR AT THE SECOND MEETING ON JANUARY 4, 1962.

ON JANUARY 10, 1962, A REPRESENTATIVE OF DATA PROCESSING COMPANY, THE COMPANY WHICH YOU LATER PROPOSED AS A SUBCONTRACTOR FOR A PORTION OF THE REQUIRED WORK, TELEPHONED THE SOIL CONSERVATION SERVICE AND ASKED TO BE FURNISHED WITH A COPY OF THE MATERIAL FURNISHED THE SEVEN FIRMS INVITED TO SUBMIT OFFERS. A COPY WAS FURNISHED THIS FIRM AND IT DID NOT SUBMIT AN OFFER. ON JANUARY 11, 1962, A REPRESENTATIVE OF YOUR FIRM ASKED PERMISSION TO SUBMIT A PROPOSAL. IT IS REPORTED THAT UP TO THAT TIME THE SOIL CONSERVATION SERVICE DID NOT KNOW THAT YOUR COMPANY WAS IN EXISTENCE. IT WAS LATER ASCERTAINED THAT YOUR FIRM WAS INCORPORATED ON NOVEMBER 7, 1961, AND THAT YOU OPENED FOR BUSINESS ON DECEMBER 1, 1961. AS OF JANUARY 12, 1962, SIX OF THE SEVEN FIRMS ORIGINALLY INVITED TO SUBMIT PROPOSALS HAD SUBMITTED PROPOSALS. YOU HAD ALSO SUBMITTED A PROPOSAL. YOUR PROPOSAL IN THE AMOUNT OF $117,390 WAS LOW AND THE OTHER BIDS RANGED IN PRICE UP TO $292,260.

ON JANUARY 18, 1962, THE PROPOSAL OF ERNEST E. BLANCHE AND ASSOCIATES, INC., IN THE AMOUNT OF $122,595.60 WAS ACCEPTED, RESULTING IN CONTRACT NO. 12-10-001-675. THE DETERMINATION BY THE CONTRACTING OFFICER TO AWARD THE CONTRACT TO BLANCHE AS BEING THE BEST INTEREST OF THE GOVERNMENT WAS BASED ON THE FOLLOWING REASONS:

"1. THE HEAVY WORK LOAD UNDER THE PROPOSED CONTRACT WILL BE DURING THE FIRST TWELVE WEEKS, THUS REQUIRING AN EFFICIENT STAFF TRAINED TO WORK TOGETHER AND UNDER COORDINATED DIRECTION.

"2. TIMELY DELIVERY AND CORRECT SUMMARIES ARE THE ESSENCE OF THE CONTRACT.

"3. LATE OR INCORRECT SUMMARIES WOULD SERIOUSLY AFFECT THE VALUE OF THE MEETINGS CALLED BY THE ADMINISTRATOR.

"4. BLANCHE AND ASSOCIATES, INC. HAVE AN OPERATING ORGANIZATION; ALL EQUIPMENT CENTRALIZED UNDER ITS CONTROL; WELL TRAINED EMPLOYEES, AND HAS DONE AN EXCELLENT JOB FOR THE SERVICE.

"5. COMPUTER DYNAMICS CORPORATION IS NEWLY ORGANIZED; SO FAR HAS NOT HAD A JOB; OWNS NO EQUIPMENT; DOES NOT HAVE A SERVICE OPERATING STAFF ON THE JOB AT THE PRESENT TIME; AND WOULD HAVE TO GO THROUGH AN ORIENTATION PERIOD WITH THE SERVICE.

"6. MATERIAL TIME WOULD BE SAVED ON THE PART OF THE SCS STAFF IN WORKING WITH A CONTRACTOR EXPERIENCED IN SERVICE REQUIREMENTS.

"7. THE WORK IS STILL IN THE TESTING PERIOD.'

YOU CONTEND THAT YOU SHOULD HAVE BEEN AWARDED THE CONTRACT SINCE YOU WERE THE QUALIFIED LOW BIDDER.

AS INDICATED ABOVE, THE CONTRACTING OFFICER FOUND THAT YOU DID NOT HAVE A SERVICE OPERATING STAFF ON THE JOB AS OF JANUARY 18, 1962, AND THAT IT WAS IN THE INTEREST OF THE GOVERNMENT TO SECURE THE SERVICES OF AN ORGANIZATION THAT WAS ACTUALLY OPERATING AS SUCH, WITH A REASONABLE ASSURANCE THAT THE JOB WOULD BE PERFORMED ACCEPTABLY AND ON TIME. IT WAS DECIDED THAT THE PROVEN ABILITY OF BLANCHE AND ASSOCIATES AND ITS FAMILIARITY WITH THE JOB REQUIREMENTS OUTWEIGHED THE PRICE ADVANTAGE OF YOUR LOW BID IN VIEW OF THE FACT THAT YOUR FIRM WAS NEWLY ESTABLISHED.

IN THE CASE OF NEGOTIATED PROCUREMENTS THE RULES OF FORMALLY ADVERTISED COMPETITIVE BIDDING DO NOT APPLY AND THE TERMS AND CONDITIONS UPON WHICH PROPOSALS ARE REQUESTED AND THE SELECTION OF CONTRACTORS ARE DETERMINED ARE MATTERS FOR THE ADMINISTRATIVE OFFICE CONCERNED IN THE EXERCISE OF ITS BEST JUDGMENT AS TO THE INTERESTS OF THE GOVERNMENT. IN THIS CASE THE FACT THAT YOUR BID WAS ONLY $5,205 LESS THAN THE BID OF $122,595.60 SUBMITTED BY BLANCHE AND ASSOCIATES AND THE FACT THAT YOU HAD NOT AS YET PERFORMED ANY WORK AS AN ORGANIZATION WERE MATTERS FULLY CONSIDERED BY THE ADMINISTRATIVE OFFICE.

IN VIEW OF THE WIDE DISCRETION VESTED IN ADMINISTRATIVE OFFICIALS IN NEGOTIATED PROCUREMENTS AND SINCE THERE IS NOTHING IN THE RECORD TO INDICATE THAT THE CONTRACTING OFFICIALS FAILED TO EXERCISE THEIR BEST JUDGMENT IN MAKING THE AWARD, WE DO NOT FEEL THAT THE FAILURE TO AWARD THE CONTRACT TO YOUR FIRM WAS IMPROPER.