B-151610, AUG. 7, 1963

B-151610: Aug 7, 1963

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YOAKUM AND BALLANTYNE: REFERENCE IS MADE TO LETTER OF JULY 11. THE FACTORS YOU CONSIDER TO BE IMPORTANT ARE: (1) KING NUTRONICS IS SMALL BUSINESS AND IT IS THE POLICY OF THE ARMED SERVICES PROCUREMENT REGULATIONS TO PLACE CONTRACTS WITH SMALL BUSINESS WHENEVER POSSIBLE. (3) KING NUTRONICS IS PREPARED TO PAY THE GOVERNMENT $2. 900 IN SATISFACTION OF A GOVERNMENT LIEN ON A PROTOTYPE PRODUCED BY ANOTHER FIRM IF IT IS ALLOWED TO USE THE PROTOTYPE. THE REQUEST FOR PROPOSALS WAS NOT RESTRICTED TO SMALL BUSINESS AND DID NOT REQUIRE THAT ANY SPECIAL CONSIDERATION BE GIVEN BECAUSE OF A BIDDER'S SMALL BUSINESS STATUS OR PROMISE OF DELIVERY EARLIER THAN THE SCHEDULE SPECIFIED IN THE REQUEST FOR PROPOSALS.

B-151610, AUG. 7, 1963

TO TRIPPET, YOAKUM AND BALLANTYNE:

REFERENCE IS MADE TO LETTER OF JULY 11, 1963, FROM MR. NEIL PAPIANO, AND TO PREVIOUS CORRESPONDENCE FROM HIM, RELATIVE TO THE PROTEST OF KING NUTRONICS CORPORATION AGAINST AN AWARD TO WALLACE AND TIERNAN, INC., UNDER REQUEST FOR PROPOSALS ENG-11-184-/NEG-63-CF-147).

WITH FINAL NEGOTIATED F.O.B. ORIGIN PRICES AND TRANSPORTATION COSTS TAKEN INTO ACCOUNT, THE CONTRACTING OFFICER DETERMINED THAT IN MAKING AN AWARD TO WALLACE AND TIERNAN, INC., THE TOTAL COST ($730,869.33) WOULD BE $3,330.37 LESS THAN AN AWARD TO KING NUTRONICS. ACCORDING TO YOUR CALCULATIONS THE DIFFERENCE SHOULD BE ONLY $667.45. IN VIEW OF THE SMALL DIFFERENCE IN THE FACE OF THE LARGE TOTAL COSTS, YOU SUGGEST THAT CERTAIN OTHER FACTORS SHOULD BE OVERRIDING. THE FACTORS YOU CONSIDER TO BE IMPORTANT ARE: (1) KING NUTRONICS IS SMALL BUSINESS AND IT IS THE POLICY OF THE ARMED SERVICES PROCUREMENT REGULATIONS TO PLACE CONTRACTS WITH SMALL BUSINESS WHENEVER POSSIBLE; (2) KING NUTRONICS HAS PROPOSED AN INITIAL DELIVERY SEVEN MONTHS EARLIER THAN OTHER DELIVERY SCHEDULES; AND (3) KING NUTRONICS IS PREPARED TO PAY THE GOVERNMENT $2,900 IN SATISFACTION OF A GOVERNMENT LIEN ON A PROTOTYPE PRODUCED BY ANOTHER FIRM IF IT IS ALLOWED TO USE THE PROTOTYPE.

THE REQUEST FOR PROPOSALS WAS NOT RESTRICTED TO SMALL BUSINESS AND DID NOT REQUIRE THAT ANY SPECIAL CONSIDERATION BE GIVEN BECAUSE OF A BIDDER'S SMALL BUSINESS STATUS OR PROMISE OF DELIVERY EARLIER THAN THE SCHEDULE SPECIFIED IN THE REQUEST FOR PROPOSALS. AS TO THE OFFER TO SETTLE A SUPPOSED LIEN ON A PREVIOUS CONTRACTOR'S PROTOTYPE, THE CONTRACTING OFFICER HAS ADVISED THAT THE GOVERNMENT HAS TAKEN TITLE TO THE UNIT AND IT WOULD NOT BE AVAILABLE FOR USE BY KING NUTRONICS IN ANY EVENT. THUS THE $2,900 OFFER IS DEFINITELY NOT A MATTER FOR CONSIDERATION.

THE MANNER OF EVALUATING PROPOSALS WAS SET OUT IN PARAGRAPH 11 OF THE SPECIAL TERMS AND CONDITIONS IN THE REQUEST FOR PROPOSALS. THAT PARAGRAPH PROVIDED THAT BIDS WOULD BE EVALUATED ON THE BASIS OF THE LOWEST OVER-ALL COST TO THE GOVERNMENT, CONSISTENT WITH REQUIREMENTS, AND THAT TRANSPORTATION COSTS WOULD BE CONSIDERED IN DETERMINING THE LOWEST COST TO THE GOVERNMENT. THE PARAGRAPH CLEARLY CONTEMPLATED THAT THE AWARD WOULD BE MADE ON THE BASIS OF THE LOWEST EVALUATED COST TO THE GOVERNMENT. THE KING NUTRONICS PROPOSAL WAS NOT THE LOWEST EVALUATED PROPOSAL, IT WAS NOT IMPROPER FOR THE CONTRACTING OFFICER TO REFUSE TO MAKE AN AWARD TO THE FIRM.