B-149435, NOV. 23, 1962

B-149435: Nov 23, 1962

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YOU HAVE BY LETTER DATED JULY 12. THE THREE DEPOTS ARE LOCATED IN SOUTH SAN FRANCISCO. THE LOWEST BID ON THE SOUTH SAN FRANCISCO AND OAKLAND DEPOTS WAS SUBMITTED BY APPROVED MAINTENANCE SERVICE. THE NEXT LOWEST BID WAS SUBMITTED BY WESTERN GIRLS. WAS REJECTED BECAUSE THE CONTRACTING OFFICER COULD NOT MAKE AN AFFIRMATIVE DETERMINATION. THAT THE CORPORATION WAS A RESPONSIBLE BIDDER. A CONTRACT FOR FURNISHING LABORERS FOR THE SOUTH SAN FRANCISCO AND OAKLAND DEPOTS WAS AWARDED TO WESTERN MEN. YOU HAVE NO CONTACT POINT IN THE SAN FRANCISCO OR OAKLAND AREA AND I HAVE DETERMINED YOU ARE UNABLE TO COMPLY WITH THAT PART OF PARAGRAPH 1 ON PAGE 3 OF THE INVITATION WHICH STATES: . CONTRACTOR WILL BE INFORMED DAILY (BEFORE 4:00 P.M.).

B-149435, NOV. 23, 1962

TO SICILIANO AND DALY:

ON BEHALF OF APPROVED MAINTENANCE SERVICE, INC., YOU HAVE BY LETTER DATED JULY 12, 1962, PROTESTED THE REJECTION OF THAT FIRM'S LOW BID SUBMITTED IN RESPONSE TO INVITATION NO. SFD-5145-62, ISSUED APRIL 19, 1962, BY THE FEDERAL SUPPLY SERVICE, GENERAL SERVICES ADMINISTRATION, SAN FRANCISCO, CALIFORNIA.

THE INVITATION REQUESTED BIDS FOR FURNISHING WAREHOUSE LABORERS AS REQUIRED FOR WORK TO BE PERFORMED AT THREE GSA STORES DEPOTS DURING THE PERIOD FROM JULY 1, 1962, THROUGH JUNE 30, 1963. THE THREE DEPOTS ARE LOCATED IN SOUTH SAN FRANCISCO, BELL AND OAKLAND, CALIFORNIA, RESPECTIVELY. THE LOWEST BID ON THE SOUTH SAN FRANCISCO AND OAKLAND DEPOTS WAS SUBMITTED BY APPROVED MAINTENANCE SERVICE, INC., AND THE NEXT LOWEST BID WAS SUBMITTED BY WESTERN GIRLS, INC., DBA WESTERN MEN, INC. HOWEVER, THE BID OF APPROVED MAINTENANCE SERVICE, INC., WAS REJECTED BECAUSE THE CONTRACTING OFFICER COULD NOT MAKE AN AFFIRMATIVE DETERMINATION, AS REQUIRED BY SECTION 1-1.310-6 OF THE FEDERAL PROCUREMENT REGULATIONS, THAT THE CORPORATION WAS A RESPONSIBLE BIDDER. ON JUNE 29, 1962, A CONTRACT FOR FURNISHING LABORERS FOR THE SOUTH SAN FRANCISCO AND OAKLAND DEPOTS WAS AWARDED TO WESTERN MEN, INC.

IN A LETTER DATED JULY 13, 1962, THE CONTRACTING OFFICER ADVISED APPROVED MAINTENANCE SERVICE, INC., AS FOLLOWS:

"A REVIEW OF YOUR BID AND INVESTIGATION OF YOUR FIRM REVEALS THE FOLLOWING DEFICIENCIES:

"1. YOU HAVE NO CONTACT POINT IN THE SAN FRANCISCO OR OAKLAND AREA AND I HAVE DETERMINED YOU ARE UNABLE TO COMPLY WITH THAT PART OF PARAGRAPH 1 ON PAGE 3 OF THE INVITATION WHICH STATES: ,CONTRACTOR WILL BE INFORMED DAILY (BEFORE 4:00 P.M.) OF THE SUCCEEDING DAYS REQUIREMENTS AND IT SHALL BE THE RESPONSIBILITY OF THE CONTRACTOR TO COMPLY ACCORDINGLY.'

"2. YOUR FIRM WAS CHARTERED IN JULY OF 1961 AND PARAGRAPH 16 ON PAGE 6 OF THE INVITATION PROVIDES IN PART: "BIDS WILL ONLY BE CONSIDERED FROM BIDDERS WHO HAVE BEEN REGULARLY ENGAGED IN THE BUSINESS OF FURNISHING LABORER EMPLOYMENT FOR A PERIOD OF AT LEAST ONE (1) YEAR.'

"3. YOUR FIRM CONDUCTS A BUILDING MAINTENANCE SERVICE WHICH ALSO FAILS TO COMPLY WITH THE CLAUSE CITED IN 2 ABOVE WHICH CONTEMPLATES WAREHOUSE LABORERS.

"4. YOUR FIRM'S PRINCIPAL ASSETS ARE BELIEVED TO BE IN CASH BALANCES AND FIXTURES AND EQUIPMENT OF APPROXIMATELY $4,000 WHICH WOULD PERMIT THE GOVERNMENT NEGLIGIBLE RECOURSE IN EVENT OF DEFAULT.

"ACCORDINGLY, IT HAS BEEN DETERMINED THAT AN AWARD TO YOUR FIRM WOULD BE INCONSISTENT WITH THE PRESCRIBED POLICIES AND CONTRACTING PROCEDURES OF THIS ADMINISTRATION. WE HAVE, THEREFORE, REJECTED YOUR OFFER AND HAVE MADE AWARD OF CONTRACT LABOR SERVICE FOR SOUTH SAN FRANCISCO AND OAKLAND TO ANOTHER BIDDER.'

BY LETTER DATED JULY 24, 1962, YOU PROTESTED THE ADMINISTRATIVE DETERMINATION THAT THE BID OF APPROVED MAINTENANCE SERVICE, INC., SHOULD BE REJECTED. AFTER RECEIVING YOUR LETTER, THE CONTRACTING OFFICER REFERRED THE MATTER OF THE CORPORATION'S CAPABILITIES TO THE SMALL BUSINESS ADMINISTRATION FOR THE PURPOSE OF AFFORDING THAT ADMINISTRATION AN OPPORTUNITY TO ISSUE A CERTIFICATE OF COMPETENCY ON BEHALF OF THE CORPORATION. THE PROCUREMENT AGENCY WAS ADVISED BY MR. DIXON OF THE RICHMOND DISTRICT OFFICE OF THE SMALL BUSINESS ADMINISTRATION THAT SINCE APPROVED MAINTENANCE SERVICE, INC., HAD DECLINED TO FILE FOR A CERTIFICATE OF COMPETENCY ON THE INVITATION IN QUESTION, HIS OFFICE WOULD TAKE NO FURTHER ACTION IN THE MATTER.

IN YOUR LETTER OF JULY 12, 1962, YOU STATE THAT YOU HAD COMMUNICATED WITH THE CONTRACTING OFFICER AND WERE TOLD BY THAT OFFICER THAT THE CORPORATION WAS DISQUALIFIED BECAUSE IT HAD NOT BEEN IN BUSINESS FOR ONE YEAR; THAT WHILE IT IS TRUE APPROVED MAINTENANCE SERVICE, INC., WAS IN FACT INCORPORATED IN AUGUST 1961, LESS THAN A YEAR AGO, YOUR CLIENTS HAVE BEEN IN BUSINESS FOR A NUMBER OF YEARS AND HAVE SUCCESSFULLY COMPLETED CONTRACTS WITH THE GOVERNMENT; AND THAT THE INCORPORATION OF YOUR CLIENTS WAS DONE FOR CERTAIN TAX BENEFITS AND FOR OTHER REASONS. YOU CONTEND THAT BEING IN BUSINESS FOR LESS THAN ONE YEAR IS NOT A PROPER BASIS FOR DISQUALIFICATION.

WHILE INFORMATION FURNISHED BY THE ADMINISTRATIVE OFFICE DOES INDICATE THAT MR. VERDICANO, PRESIDENT OF APPROVED MAINTENANCE SERVICE, INC., HAS CONDUCTED A BUILDING MAINTENANCE SERVICE FOR A NUMBER OF YEARS UNDER HIS OWN NAME, SUCH SERVICE DID NOT COVER THE FURNISHING OF WAREHOUSE LABORERS AS CONTEMPLATED BY PARAGRAPH 16 OF THE SPECIAL PROVISIONS OF THE INVITATION. THE RECORD INDICATES THAT PRIOR TO THE REJECTION OF THE CORPORATION'S BID, THE CORPORATION WAS REQUESTED TO ANSWER CERTAIN QUESTIONS AND THAT IN REPLY THERETO THE CORPORATION STATED THAT THE NUMBER OF LABORERS THAT IT WOULD BE ABLE TO SUPPLY WOULD BE DETERMINED BY THE LABOR POOL ACCESSIBLE AT THE MINIMUM HOURLY WAGE OF $1.15 PER HOUR, UPON WHICH RATE ITS BID PRICE WAS BASED. IT IS REPORTED THAT THE CURRENT WAGE RATE FOR LABORERS OF THE TYPE CONTEMPLATED BY THE INVITATION, IN THE SAN FRANCISCO AND OAKLAND AREAS, IS APPROXIMATELY $1.50 PER HOUR AND THAT THE CURRENT CONTRACTOR IS PAYING LABORERS AT THE RATE OF $1.57 PER HOUR. THE PROCUREMENT AGENCY STATES THAT IN VIEW OF THE FOREGOING INFORMATION IT HAS SERIOUS DOUBTS AS TO THE ABILITY OF APPROVED MAINTENANCE SERVICE, C., TO PROVIDE SERVICES IN THE MANNER AND TO THE EXTENT REQUIRED.

CLEARLY, ONE OF THE FACTS IN DETERMINING THE RESPONSIBILITY OF A BIDDER IS HIS APPARENT ABILITY TO PERFORM IN ACCORDANCE WITH THE REQUIREMENTS SET OUT IN THE INVITATION. THE DETERMINATION OF THE PROSPECTIVE CONTRACTOR'S ABILITY TO PERFORM IS PRIMARILY THE FUNCTION OF THE ADMINISTRATIVE OFFICERS CONCERNED, AND IN THE ABSENCE OF ANY SHOWING OF BAD FAITH OR LACK OF REASONABLE BASIS THEREFOR, THERE IS NO BASIS UPON WHICH WE MAY OBJECT. 37 COMP. GEN. 430, 435. THE PROJECTION OF BIDDER'S ABILITY TO PERFORM IF AWARDED A CONTRACT IS OF NECESSITY A MATTER OF JUDGMENT. WHILE SUCH JUDGMENT SHOULD BE BASED ON FACT AND SHOULD BE ARRIVED AT IN GOOD FAITH, IT MUST PROPERLY BE LEFT LARGELY TO THE SOUND ADMINISTRATIVE DISCRETION OF THE CONTRACTING OFFICES INVOLVED, SINCE THEY ARE IN THE BEST POSITION TO ASSESS RESPONSIBILITY, AND THEY MUST BEAR THE MAJOR BRUNT OF ANY DIFFICULTIES EXPERIENCED BY REASON OF THE CONTRACTOR'S LACK OF ABILITY, AND THEY MUST MAINTAIN THE DAY-TO-DAY RELATIONS WITH THE CONTRACTOR ON BEHALF OF THE GOVERNMENT. FOR THESE REASONS, IT WOULD BE UNREASONABLE TO SUPERIMPOSE THE JUDGMENT OF OUR OFFICE OR ANY OTHER AGENCY OR GROUP ON THAT OF THE CONTRACTING OFFICIALS.

ALTHOUGH GSA DID NOT REQUEST A CERTIFICATE FROM THE SMALL BUSINESS ADMINISTRATION REGARDING THE COMPETENCY OF APPROVED MAINTENANCE SERVICE, INC., AS TO ITS CAPACITY AND CREDIT PRIOR TO REJECTION OF ITS BID AS REQUIRED BY SECTION 1-1.708-2 OF THE FEDERAL PROCUREMENT REGULATIONS, INASMUCH AS THAT FIRM DECLINED TO FILE FOR SUCH A CERTIFICATE WE CANNOT CONCLUDE THAT THE ADMINISTRATIVE ACTION WAS SO ERRONEOUS AS TO REQUIRE CANCELLATION OF THE CONTRACT AWARDED.

ACCORDINGLY, YOU ARE ADVISED THAT THERE IS NO LEGAL BASIS UPON WHICH WE WOULD BE JUSTIFIED IN QUESTIONING THE ADMINISTRATIVE ACTION TAKEN IN THE MATTER.