B-149631, DEC. 6, 1962

B-149631: Dec 6, 1962

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO THE SECRETARY OF DEFENSE: WE ARE ENCLOSING A COPY OF OUR LETTER OF TODAY TO THE HONORABLE HARRISON A. N123/246/31316A WAS AWARDED TO NRC EQUIPMENT CORPORATION BY THE DEPARTMENT OF THE NAVY. YOUR SPECIFIC ATTENTION IS INVITED TO THE FACT THAT THIS PROCUREMENT WAS INITIALLY SET ASIDE FOR SMALL BUSINESS UNDER SMALL BUSINESS RESTRICTED ADVERTISING PROCEDURES. THAT NO RESPONSIVE BIDS WERE RECEIVED IN RESPONSE TO SUCH ADVERTISING. THAT ASPR 3-210.2 (III) WAS THEREAFTER RELIED UPON AS AUTHORITY FOR LIMITING NEGOTIATIONS TO THE ORIGINAL BIDDERS. COPY OF THE FINDINGS AND DETERMINATION IN SUPPORT OF SUCH EXERCISE OF THE NEGOTIATION AUTHORITY IS ALSO ENCLOSED. PROHIBITING TOTAL SET- ASIDES FOR SMALL BUSINESS UNLESS THERE IS A REASONABLE EXPECTATION THAT BIDS OR PROPOSALS WILL BE OBTAINED FROM A SUFFICIENT NUMBER OF SMALL BUSINESS CONCERNS TO INSURE THAT AWARDS WILL BE MADE AT REASONABLE PRICES.

B-149631, DEC. 6, 1962

TO THE SECRETARY OF DEFENSE:

WE ARE ENCLOSING A COPY OF OUR LETTER OF TODAY TO THE HONORABLE HARRISON A. WILLIAMS, JR., UNITED STATES SENATE, WHICH SETS OUT THE FACTS AND CIRCUMSTANCES UNDER WHICH CONTRACT NO. N123/246/31316A WAS AWARDED TO NRC EQUIPMENT CORPORATION BY THE DEPARTMENT OF THE NAVY.

YOUR SPECIFIC ATTENTION IS INVITED TO THE FACT THAT THIS PROCUREMENT WAS INITIALLY SET ASIDE FOR SMALL BUSINESS UNDER SMALL BUSINESS RESTRICTED ADVERTISING PROCEDURES; THAT NO RESPONSIVE BIDS WERE RECEIVED IN RESPONSE TO SUCH ADVERTISING; AND THAT ASPR 3-210.2 (III) WAS THEREAFTER RELIED UPON AS AUTHORITY FOR LIMITING NEGOTIATIONS TO THE ORIGINAL BIDDERS. COPY OF THE FINDINGS AND DETERMINATION IN SUPPORT OF SUCH EXERCISE OF THE NEGOTIATION AUTHORITY IS ALSO ENCLOSED.

IN VIEW OF THE PROVISIONS OF ASPR 1-706.5 (A), PROHIBITING TOTAL SET- ASIDES FOR SMALL BUSINESS UNLESS THERE IS A REASONABLE EXPECTATION THAT BIDS OR PROPOSALS WILL BE OBTAINED FROM A SUFFICIENT NUMBER OF SMALL BUSINESS CONCERNS TO INSURE THAT AWARDS WILL BE MADE AT REASONABLE PRICES, THE FAILURE TO RECEIVE ANY RESPONSIVE BID ON A TOTAL SET-ASIDE APPEARS TO RAISE SERIOUS QUESTIONS AS TO BOTH THE VALIDITY OF THE SET ASIDE DETERMINATION AND THE PROPRIETY OF LIMITING FURTHER COMPETITIVE OPPORTUNITY TO EITHER THE ORIGINAL BIDDERS OR TO SMALL BUSINESS CONCERNS. DOUBT THAT ASPR 3-210.2 (III) IS INTENDED TO AUTHORIZE SUCH LIMITATION IS COMPOUNDED BY THE LANGUAGE THEREIN WHICH LIMITS EXAMPLE (III) TO PROCUREMENTS IN WHICH BIDS HAVE BEEN SOLICITED PURSUANT TO THE REQUIREMENTS OF SECTION II OF THE ASPR, WHILE THE AUTHORIZATION FOR USE OF SMALL BUSINESS RESTRICTED ADVERTISING APPEARS IN SECTION I.

NOTWITHSTANDING THE ADVICE OF THE CONTRACTING AGENCY IN THE INSTANT PROCUREMENT THAT ITS INVESTIGATION FAILED TO INDICATE A SINGLE LARGE BUSINESS CONCERN WHICH HAS PRODUCED EQUIPMENT MEETING THE SPECIFICATION REQUIREMENTS, IT HAS BEEN THE CONSISTENT POSITION OF THIS OFFICE THAT CONCLUSIONS OR OPINIONS OF PERSONNEL OF THE CONTRACTING AGENCY ON THE AVAILABILITY OF QUALIFIED BIDDERS ARE GENERALLY INADEQUATE OR AT BEST QUESTIONABLE AS SUBSTITUTES FOR THE SOLICITATION OF BIDS ON AN UNRESTRICTED BASIS. SEE 41 COMP. GEN. 484, 490, AND PRIOR DECISIONS CITED THEREIN.

WE THEREFORE RECOMMEND THAT CONSIDERATION BE GIVEN TO REVISING ASPR TO CLEARLY INDICATE THAT FAILURE TO RECEIVE A RESPONSIVE BID UNDER RESTRICTED ADVERTISING IS NOT TO BE CONSIDERED AS JUSTIFICATION FOR NEGOTIATION UNDER PARAGRAPH 3-210.2 (III).