B-148975, JUL. 16, 1962

B-148975: Jul 16, 1962

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TO DINGER CONTRACTING COMPANY FURTHER REFERENCE IS MADE TO YOUR LETTER OF MAY 16. THE TUNNEL BLAST DOORS WERE TO BE INSTALLED AT 12 SITES AND THE WORK TO BE PERFORMED AT THE LAST SITE WAS TO BE COMPLETED ON OR BEFORE OCTOBER 19. 864 WERE RECEIVED IN RESPONSE TO THE INVITATION. THE LOWEST BID WAS SUBMITTED BY YOUR FIRM AND THE NEXT LOWEST BID WAS SUBMITTED BY THE PHILLIP FORMEL COMPANY. SINCE YOUR FIRM SUBMITTED THE LOWEST BID A PREAWARD SURVEY WAS CONDUCTED OF YOUR CAPABILITIES TO PERFORM THE RESULTING CONTRACT. YOUR BID WAS REJECTED BECAUSE THE CONTRACTING OFFICER COULD NOT MAKE AN AFFIRMATIVE DETERMINATION AS REQUIRED BY SECTION 1-904.1 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) THAT YOUR COMPANY WAS A RESPONSIBLE BIDDER.

B-148975, JUL. 16, 1962

TO DINGER CONTRACTING COMPANY

FURTHER REFERENCE IS MADE TO YOUR LETTER OF MAY 16, 1962, PROTESTING AGAINST THE ACTION OF THE U.S. ARMY ENGINEER DISTRICT, NEW YORK, IN REJECTING YOUR BID SUBMITTED IN RESPONSE TO INVITATION NO. ENG-30-075 62- 118 DATED APRIL 5, 1962.

THE INVITATION REQUESTED BIDS FOR FURNISHING AND INSTALLING TUNNEL BLAST DOORS FOR WS-107A-1, OPERATIONAL BASE MISSILE LAUNCHER COMPLEXES NEAR PLATTSBURGH AIR FORCE BASE, PLATTSBURGH, NEW YORK. THE TUNNEL BLAST DOORS WERE TO BE INSTALLED AT 12 SITES AND THE WORK TO BE PERFORMED AT THE LAST SITE WAS TO BE COMPLETED ON OR BEFORE OCTOBER 19, 1962. THE CONTRACT PROVIDED FOR ASSESSMENT OF LIQUIDATED DAMAGES OF $100 PER DAY FOR EACH DAY'S DELAY AT EACH SITE. TEN BIDS RANGING FROM $92,204 TO $378,864 WERE RECEIVED IN RESPONSE TO THE INVITATION. THE LOWEST BID WAS SUBMITTED BY YOUR FIRM AND THE NEXT LOWEST BID WAS SUBMITTED BY THE PHILLIP FORMEL COMPANY.

SINCE YOUR FIRM SUBMITTED THE LOWEST BID A PREAWARD SURVEY WAS CONDUCTED OF YOUR CAPABILITIES TO PERFORM THE RESULTING CONTRACT. YOUR BID WAS REJECTED BECAUSE THE CONTRACTING OFFICER COULD NOT MAKE AN AFFIRMATIVE DETERMINATION AS REQUIRED BY SECTION 1-904.1 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) THAT YOUR COMPANY WAS A RESPONSIBLE BIDDER. SUCH AFFIRMATIVE DETERMINATION WAS PREVENTED SPECIFICALLY BY YOUR COMPANY'S POOR RECORD OF PERFORMANCE UNDER CONTRACTS FOR SIMILAR WORK, NAMELY, CONTRACT NO. DA-30-075-ENG-10092 COVERING WORK AT PLATTSBURGH, NEW YORK, AND CONTRACT NO. DA-29-005-ENG 3212 COVERING WORK AT THE WALKER AIR FORCE BASE, ROSWELL, NEW MEXICO. ON MAY 9, 1962, THE SMALL BUSINESS ADMINISTRATION (SBA) WAS ADVISED BY THE CONTRACTING OFFICER THAT AN AWARD MUST BE MADE WITHOUT DELAY AND WITHOUT AFFORDING THAT ADMINISTRATION AN OPPORTUNITY TO CONSIDER WHETHER A CERTIFICATE OF COMPETENCY SHOULD BE ISSUED TO YOUR FIRM. THIS ACTION IS SUPPORTED BY A CERTIFICATE EXECUTED PURSUANT TO ASPR 1 705.6 (B) (I), THAT THE PROJECT IS A VITAL ELEMENT OF THE ICBM PROGRAM; THAT ADHERENCE TO THE COMPLETION DATES SET FORTH IN THE CONTRACT IS OF UTMOST IMPORTANCE; AND THAT ACCOMPLISHMENT OF THE WORK BY SUCH DATES REQUIRES IMMEDIATE AWARD TO ASSURE MAINTENANCE OF A COORDINATED SCHEDULE FOR THE MISSILE PROGRAM. ON THE SAME DATE YOU WERE NOTIFIED THAT YOUR BID WAS REJECTED FOR THE REASON THAT THE CONTRACTING OFFICER COULD NOT MAKE AN AFFIRMATIVE FINDING THAT YOU WERE A RESPONSIBLE BIDDER BECAUSE OF YOUR PREVIOUS PERFORMANCE ON THIS TYPE OF INSTALLATION. THE CONTRACT FOR THE PERFORMANCE OF THE WORK WAS AWARDED TO THE PHILLIP FORMEL COMPANY ON MAY 9, 1962.

IN YOUR LETTER OF MAY 16, 1962, YOU STATE THAT:

"WE BELIEVE WE HAVE LEGITIMATE COMPLAINT HERE HAVING BEEN DENIED THE S.B.A. CERTIFICATION FOR COMPETENCY PROCEDURE, BECAUSE WE CANNOT BELIEVE THAT THE 15 WORK DAY PERIOD REQUIRED BY S.B.A. FOR PROCESSING A CERTIFICATE OF COMPETENCY COULD BE SUFFICIENT LOSS OF TIME AS TO CREATE "URGENCY" SUFFICIENT TO BY-PASS THIS S.B.A. PROCEDURE.'

ASPR 1-705.6 (B) (I) PROVIDES THAT:

"/B) 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 ACTION CONCERNING ISSUANCE OF A CERTIFICATE OF COMPETENCY OR THE EXPIRATION OF FIFTEEN WORKING DAYS AFTER SBA IS SO NOTIFIED, WHICHEVER IS EARLIER, SUBJECT TO THE FOLLOWING:

"/I) THIS PROCEDURE IS NOT MANDATORY WHERE THE CONTRACTING OFFICER CERTIFIES IN WRITING THAT AWARD MUST BE MADE WITHOUT DELAY, AND PROMPTLY ADVISES THE SBA REPRESENTATIVE THEREOF, AND INCLUDES IN THE CONTRACT FILE A STATEMENT SIGNED BY HIM WHICH JUSTIFIES THE CERTIFICATE. A COPY OF THE STATEMENT SHALL BE FURNISHED THE SBA REPRESENTATIVE.'

WHILE YOUR BID WAS REJECTED BECAUSE IT WAS DETERMINED THAT YOUR FIRM LACKED THE CAPABILITIES TO ASSURE SATISFACTORY PERFORMANCE ON THE SUBJECT SOLICITATION AND, PURSUANT TO ASPR 1-705.6 (B), THE MATTER ORDINARILY WOULD BE SUBMITTED TO THE SMALL BUSINESS ADMINISTRATION FOR CONSIDERATION AS TO WHETHER A CERTIFICATE OF COMPETENCY SHOULD BE ISSUED, THE CONTRACTING OFFICER WAS NOT OBLIGED TO FOLLOW SUCH PROCEDURE HERE. ASPR 1 -705.6 (B) (I), ABOVE QUOTED, PROVIDES THAT SUCH PROCEDURE IS NOT MANDATORY WHERE THE CONTRACTING OFFICER CERTIFIES IN WRITING THAT AWARD MUST BE MADE WITHOUT DELAY. SUCH A CERTIFICATE IS IN THE FILE BEFORE US AND THERE IS NOTHING IN THE RECORD WHICH WOULD REQUIRE OUR OFFICE TO QUESTION THE BASIS OF THE CERTIFICATION.

IT LONG HAS BEEN AN ESTABLISHED RULE OF OUR OFFICE THAT THE DETERMINATION OF THE CAPABILITIES OF A BIDDER--- INDEPENDENT OF THE AUTHORITY OF THE SMALL BUSINESS ADMINISTRATION TO ISSUE A CERTIFICATE OF COMPETENCY--- IS PRIMARILY THE FUNCTION OF THE PROCUREMENT AGENCY, AND IN THE ABSENCE OF BAD FAITH OR LACK OF REASONABLE FACTUAL BASIS FOR THE DETERMINATION, WE WILL NOT OBJECT TO THE DETERMINATION AS MADE. 38 COMP. GEN. 248.

IN VIEW OF THE FOREGOING, WE MUST CONCLUDE THAT THE AWARD ACTION TAKEN BY THE DEPARTMENT OF THE ARMY IN THE MATTER IS NOT SUBJECT TO LEGAL OBJECTION.