B-151977, OCT. 3, 1963

B-151977: Oct 3, 1963

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FPNSO-9J-1844 TO ANY BIDDER OTHER THAN YOUR COMPANY FOR THE REASON THAT YOU WERE THE LOWEST RESPONSIBLE BIDDER. A PLANT FACILITY INVESTIGATION WAS CONDUCTED OF YOUR PLANT AS AN AID IN DETERMINING YOUR RESPONSIBILITY AS A PROSPECTIVE GOVERNMENT CONTRACTOR. FINAL INSPECTIONS WERE NOT SUFFICIENT TO INSURE ADEQUATE QUALITY CONTROL NECESSARY FOR SATISFACTORY CONTRACT PERFORMANCE. THE REPORT INDICATED THAT ON NUMEROUS OCCASIONS YOU WERE REQUESTED TO INSTALL AN ADEQUATE INSPECTION SYSTEM. SUCH A SYSTEM WAS NOT OPERATIONAL WITHIN YOUR ORGANIZATION EVEN THOUGH YOU HAD AGREED TO INSTALL A QUALITY CONTROL SYSTEM. THE SMALL BUSINESS ADMINISTRATION WAS REQUESTED TO DETERMINE YOUR CAPACITY AND CREDIT FOR CERTIFICATE OF COMPETENCY PURPOSES.

B-151977, OCT. 3, 1963

TO TRU-RITE INC.:

BY TELEFAX DATED JULY 5, 1963, YOU PROTESTED AGAINST AN AWARD OF A CONTRACT UNDER INVITATION FOR BIDS NO. FPNSO-9J-1844 TO ANY BIDDER OTHER THAN YOUR COMPANY FOR THE REASON THAT YOU WERE THE LOWEST RESPONSIBLE BIDDER.

THE INVITATION DATED MARCH 27, 1963, REQUESTED BIDS FOR COTTON TYPEWRITER AND TELETYPEWRITER RIBBONS FOR THE PERIOD AUGUST 1, 1963, THROUGH SEPTEMBER 30, 1964. YOU SUBMITTED THE LOWEST BIDS ON ITEMS 1 THROUGH 4. PURSUANT TO SECTION 1-1.310-6 (B) OF THE FEDERAL PROCUREMENT REGULATIONS, A PLANT FACILITY INVESTIGATION WAS CONDUCTED OF YOUR PLANT AS AN AID IN DETERMINING YOUR RESPONSIBILITY AS A PROSPECTIVE GOVERNMENT CONTRACTOR. THE REPORT OF THIS INVESTIGATION REVEALS THAT YOU HAD NO FORMAL QUALITY CONTROL SYSTEM; THAT YOU DID NOT MAINTAIN ADEQUATE PRODUCTION AND CONTROL RECORDS; AND THAT YOUR INCOMING, IN-PROCESS, AND FINAL INSPECTIONS WERE NOT SUFFICIENT TO INSURE ADEQUATE QUALITY CONTROL NECESSARY FOR SATISFACTORY CONTRACT PERFORMANCE. ALSO, THE REPORT INDICATED THAT ON NUMEROUS OCCASIONS YOU WERE REQUESTED TO INSTALL AN ADEQUATE INSPECTION SYSTEM, BUT THAT AS OF JUNE 19, 1963, SUCH A SYSTEM WAS NOT OPERATIONAL WITHIN YOUR ORGANIZATION EVEN THOUGH YOU HAD AGREED TO INSTALL A QUALITY CONTROL SYSTEM. IN VIEW THEREOF, AND IN ACCORDANCE WITH SECTION 1-1.708.2 (A) OF THE FEDERAL PROCUREMENT REGULATIONS, THE SMALL BUSINESS ADMINISTRATION WAS REQUESTED TO DETERMINE YOUR CAPACITY AND CREDIT FOR CERTIFICATE OF COMPETENCY PURPOSES. ON JULY 3, 1963, THE NEW YORK REGIONAL OFFICE OF THE SMALL BUSINESS ADMINISTRATION ADVISED THE PROCUREMENT OFFICE THAT, BASED ON A COMPREHENSIVE ANALYSIS OF ALL AVAILABLE INFORMATION, ISSUANCE OF A CERTIFICATE OF COMPETENCY TO YOUR FIRM WOULD NOT BE RECOMMENDED. THEREFORE, ON JULY 12, 1963, THE CONTRACTING OFFICER ADVISED YOU THAT YOUR BID HAD BEEN REJECTED DUE TO LACK OF RESPONSIBILITY, AND THAT AWARDS WOULD BE MADE TO THE NEXT LOWEST RESPONSIBLE BIDDERS ON JULY 12, 1963. WE FIND NO LEGAL BASIS TO QUESTION THE ACTIONS TAKEN OR THE AWARDS MADE.

WE HAVE HELD THAT THE REFUSAL OF THE SMALL BUSINESS ADMINISTRATION TO ISSUE A CERTIFICATE OF COMPETENCY TO A SMALL BUSINESS BIDDER MUST BE REGARDED AS PERSUASIVE WITH RESPECT TO THE RESPONSIBILITY OF THE BIDDER CONCERNED. 39 COMP. GEN. 705. WHEN THE ISSUANCE OF A CERTIFICATE OF COMPETENCY IS DENIED, THE CONTRACTING OFFICER'S DETERMINATION OF NONRESPONSIBILITY MUST BE REGARDED AS HAVING BEEN AFFIRMED. WE HAVE NO AUTHORITY TO REVIEW DETERMINATIONS OF THE SMALL BUSINESS ADMINISTRATION OR REQUIRE IT TO ISSUE A CERTIFICATE OF COMPETENCY. NOR DO WE DISTURB THE DETERMINATION OF A CONTRACTING OFFICER WHERE, AS HERE, IT IS SUPPORTED BY THE EVIDENCE OF RECORD AND IS NEITHER ARBITRARY NOR CAPRICIOUS.