B-156349, B-157309, OCT. 6, 1965

B-156349,B-157309: Oct 6, 1965

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TO BROTHERS CHEMICAL COMPANY: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 6. AWARD WAS TO BE MADE ON A LOT BASIS FOR THE ENTIRE QUANTITY AND IT APPEARS THAT YOUR BID WAS LOW IN THE TOTAL AMOUNT OF $58. 450 AND THAT MINE SAFETY APPLIANCES COMPANY WAS SECOND LOW BIDDER IN THE AMOUNT OF $74. THE CONTRACTING OFFICER DETERMINED THAT YOUR COMPANY DID NOT MEET THE MINIMUM STANDARDS TO QUALIFY AS A RESPONSIBLE PROSPECTIVE CONTRACTOR AND YOUR BID WAS THEREFORE REJECTED AND AWARD MADE TO MINE SAFETY APPLIANCES COMPANY ON JUNE 30. IN PROTESTING THE REJECTION OF YOUR BID YOU HAVE ALLEGED. THAT YOUR COMPANY IS RESPONSIBLE AND IS THE ONLY FIRM CAPABLE OF PRODUCING THE REQUIRED ITEMS AND MAKING DELIVERY WITHIN THE TIME SPECIFIED IN THE INVITATION.

B-156349, B-157309, OCT. 6, 1965

TO BROTHERS CHEMICAL COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 6, 1965, ADDRESSED TO EDGEWOOD ARSENAL, PROTESTING AWARD TO ANY OTHER BIDDER UNDER INVITATION FOR BIDS NO. AMC/A/-18-035-65-965, ISSUED JUNE 15, 1965, FOR OPENING ON JUNE 25, 1965.

THE ABOVE INVITATION COVERED ONE ITEM OF CHEMICAL AGENT DETECTOR KITS AND TWO ITEMS OF REFILL KITS, EACH ITEM TO BE DELIVERED IN SPECIFIED QUANTITIES TO U.S. NAVAL CONSTRUCTION BATTALION CENTERS AT DAVISVILLE, EAST GREENWICH, CONNECTICUT; AND PORT HUENEME, CALIFORNIA. AWARD WAS TO BE MADE ON A LOT BASIS FOR THE ENTIRE QUANTITY AND IT APPEARS THAT YOUR BID WAS LOW IN THE TOTAL AMOUNT OF $58,450 AND THAT MINE SAFETY APPLIANCES COMPANY WAS SECOND LOW BIDDER IN THE AMOUNT OF $74,950.60. THE CONTRACTING OFFICER DETERMINED THAT YOUR COMPANY DID NOT MEET THE MINIMUM STANDARDS TO QUALIFY AS A RESPONSIBLE PROSPECTIVE CONTRACTOR AND YOUR BID WAS THEREFORE REJECTED AND AWARD MADE TO MINE SAFETY APPLIANCES COMPANY ON JUNE 30, 1965, UNDER CONTRACT NO. DA-18-035-AMC-607/A).

IN PROTESTING THE REJECTION OF YOUR BID YOU HAVE ALLEGED, IN EFFECT, THAT YOUR COMPANY IS RESPONSIBLE AND IS THE ONLY FIRM CAPABLE OF PRODUCING THE REQUIRED ITEMS AND MAKING DELIVERY WITHIN THE TIME SPECIFIED IN THE INVITATION.

THE CONTRACTING OFFICER IS REQUIRED TO MAKE AWARD TO THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER. SECTION 1-902 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) PROVIDES AS FOLLOWS:

"1-902 GENERAL POLICY. PURCHASES SHALL BE MADE FROM, AND CONTRACTS SHALL BE AWARDED TO, RESPONSIBLE PROSPECTIVE CONTRACTORS ONLY. A RESPONSIBLE PROSPECTIVE CONTRACTOR IS ONE WHICH MEETS THE STANDARDS SET FORTH IN 1- 903.1 AND 1-903.2, AND SUCH SPECIAL STANDARDS AS MAY BE PRESCRIBED IN ACCORDANCE WITH 1-903.3 AND BY OVERSEAS COMMANDERS. THE AWARD OF A CONTRACT TO A SUPPLIER BASED ON LOWEST EVALUATED PRICE ALONE CAN BE FALSE ECONOMY IF THERE IS SUBSEQUENT DEFAULT, LATE DELIVERIES, OR OTHER UNSATISFACTORY PERFORMANCE RESULTING IN ADDITIONAL PROCUREMENT OR ADMINISTRATIVE COSTS. WHILE IT IS IMPORTANT THAT GOVERNMENT PURCHASES BE MADE AT THE LOWEST PRICE, THIS DOES NOT REQUIRE AN AWARD TO A MARGINAL SUPPLIER SOLELY BECAUSE HE SUBMITS THE LOWEST BID OR OFFER. A PROSPECTIVE CONTRACTOR MUST DEMONSTRATE AFFIRMATIVELY HIS RESPONSIBILITY, INCLUDING, WHEN NECESSARY, THAT OF HIS PROPOSED SUBCONTRACTORS. THE CONTRACTING OFFICER SHALL MAKE A DETERMINATION OF NONRESPONSIBILITY IF, AFTER COMPLIANCE WITH 1-905 AND 1-906, THE INFORMATION THUS OBTAINED DOES NOT INDICATE CLEARLY THAT THE PROSPECTIVE CONTRACTOR IS RESPONSIBLE. RECENT UNSATISFACTORY PERFORMANCE, IN EITHER QUALITY OR TIMELINESS OF DELIVERY, WHETHER OR NOT DEFAULT PROCEEDINGS WERE INSTITUTED, IS AN EXAMPLE OF A PROBLEM WHICH THE CONTRACTING OFFICER MUST CONSIDER AND RESOLVE AS TO ITS IMPACT ON THE CURRENT PROCUREMENT PRIOR TO MAKING AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY. DOUBT AS TO PRODUCTIVE CAPACITY OR FINANCIAL STRENGTH WHICH CANNOT BE RESOLVED AFFIRMATIVELY SHALL REQUIRE A DETERMINATION OF NONRESPONSIBILITY.'

BEFORE REJECTING YOUR BID, YOUR PERFORMANCE RECORD WAS CAREFULLY REVIEWED BY THE CONTRACTING OFFICER AND, OF SIX CONTRACTS CONSIDERED, THREE HAD RECENTLY BEEN TERMINATED FOR DEFAULT AND DELIVERIES UNDER THE OTHER THREE WERE SERIOUSLY DELINQUENT. THE DETAILS OF THE CONTRACTING OFFICER'S FINDINGS ARE AS FOLLOWS:

1. CONTRACT NO. DA-030-070-CML-1740/A), NY 2-1385, DATED MAY 2, 1962, COVERED DETECTOR KITS AND UNDER THE TERMS OF THE CONTRACT, AS MODIFIED, DELIVERIES WERE TO BE COMPLETED BY MAY 29, 1964. ON FEBRUARY 17, 1965, THERE WAS STILL A BALANCE OF 110 KITS UNDELIVERED AND THE CONTRACT WAS TERMINATED FOR DEFAULT ON THAT DATE BY MODIFICATION NO. 38. EDGEWOOD ARSENAL TOOK POSSESSION OF THE WORK-IN PROCESS FOR COMPLETION AT ARSENAL MANUFACTURING FACILITIES AND DELIVERY OF THE 110 KITS TO THE ULTIMATE USER.

2. CONTRACT NO. DA-30-070-CML-1808, NY 2-1827, DATED JUNE 30, 1962, COVERED A PURCHASE OF 7,070 REAGENT KITS AND THE DELIVERY SCHEDULE, AS REVISED, REQUIRED DELIVERY OF 900 KITS MONTHLY FOR THE MONTHS OF SEPTEMBER 1964 THROUGH JANUARY 1965, AN ADDITIONAL 1,200 BY FEBRUARY 26, 1965, AND THE BALANCE OF 1,370 BY MARCH 31, 1965. ACTUAL DELIVERIES WERE 213 IN SEPTEMBER 1964 AND 284 IN OCTOBER 1964. THE CONTRACT WAS TERMINATED ON MAY 12, 1965, FOR DEFAULT IN DELIVERY OF THE BALANCE OF 6,573 KITS, BY MODIFICATION NO. 11. UNLIQUIDATED PROGRESS PAYMENTS AFTER TERMINATION AMOUNTED TO $183,229.

3. CONTRACT NO. DA-18-035-AMC-231/A), DATED JUNE 23, 1964, COVERED THE FURNISHING OF 25,235 SETS OF GENERAL DIRECTIONS CARDS FOR DETECTOR KITS AND DELIVERIES WERE TO BE COMPLETED BETWEEN OCTOBER 30, 1964, AND JANUARY 31, 1965, BUT IT IS REPORTED THAT YOU NEVER UNDERTOOK PRODUCTION. THIS CONTRACT WAS TERMINATED FOR DEFAULT ON FEBRUARY 18, 1965, BY MODIFICATION NO. 7, AND REPURCHASE ACTION WAS TAKEN BY CONTRACT NO. DA-18-035-AMC- 476/A) WITH KENNERLY PRESS.

4. CONTRACT NO. DA-30-070-CML-174/A), NY 2-1386, DATED MAY 2, 1962, COVERED DETECTOR KITS AND WAS SUBCONTRACTED IN ITS ENTIRETY TO YOUR COMPANY BY CAN-TITE RUBBER CORPORATION, THE PRIME CONTRACTOR. UNDER MODIFICATION NO. 23, DATED APRIL 13, 1964, ALL DELIVERIES WERE TO BE COMPLETED BY NOVEMBER 30, 1964. DELIVERIES WERE NOT SO COMPLETED AND YOU WERE DELINQUENT AFTER THAT DATE. A REVISED SCHEDULE OF DELIVERIES WAS PROPOSED BY THE RECEIVER APPOINTED IN CONNECTION WITH INVOLUNTARY BANKRUPTCY PROCEEDINGS FILED ON FEBRUARY 16, 1965. THIS PROPOSAL CALLED FOR DELIVERY OF 1,000 KITS MONTHLY FOR THE MONTHS OF APRIL THROUGH NOVEMBER 1965, THE BALANCE OF 263 TO BE DELIVERED IN DECEMBER 1965. TOTAL OF 1,950 KITS WAS DELIVERED DURING APRIL AND MAY, BUT NO DELIVERIES WERE MADE IN JUNE, RESULTING IN A DELINQUENCY OF 1,050 KITS AS OF THE DATE OF AWARD OF CONTRACT NO. DA-18-035-AMC-607/A).

5. CONTRACT NO. DA-30-070-AMC-218/A), NY 3-1841, DATED JUNE 25, 1963, COVERED REFILL KITS AND DETECTOR KITS. UNDER MODIFICATION NO. 4, DATED MARCH 31, 1964, ALL DELIVERIES WERE TO BE COMPLETED BY NOVEMBER 30, 1964. DELIVERIES WERE NOT SO COMPLETED AND YOU WERE DELINQUENT AFTER THAT DATE. A REVISED DELIVERY SCHEDULE WAS PROPOSED BY THE RECEIVER CALLING FOR 2,000 REFILL KITS IN APRIL 1965; 630 IN MAY 1965; 1,000 DETECTOR KITS IN JUNE 1965; 500 DETECTOR KITS MONTHLY FROM JULY THROUGH NOVEMBER 1965; AND THE BALANCE OF 224 DETECTOR KITS IN DECEMBER 1965. ACTUAL DELIVERIES OF REFILL KITS WERE 500 IN APRIL 797 IN MAY AND 800 IN JUNE 1965, LEAVING A DELINQUENCY OF 533 AS OF JUNE 30. NO DELIVERIES OF DETECTOR KITS WERE MADE IN JUNE, LEAVING A DELINQUENCY OF 1,000 AS OF JUNE 30.

6.CONTRACT NO. DA-18-035-AMC-232/A), DATED JUNE 24, 1964, COVERED REFILL KITS AND DETECTOR KITS WITH DELIVERIES OF DETECTOR KITS TO START BY MAY 31, 1965. THE REVISED DELIVERY SCHEDULE PROPOSED BY THE RECEIVER CALLED FOR 3,285 REFILL KITS IN MAY 1965, 1,000 DETECTOR KITS EACH IN JUNE AND JULY 1965, AND THE BALANCE OF 965 DETECTOR KITS IN AUGUST 1965. DELIVERIES HAD BEEN MADE BY JUNE 30, 1965, RESULTING IN A DELINQUENCY OF 3,285 REFILL KITS AND 1,000 DETECTOR KITS.

IN VIEW OF THIS RECORD, THE CONTRACTING OFFICER DETERMINED THAT YOUR COMPANY DID NOT MEET THE ,MINIMUM STANDARDS FOR RESPONSIBLE PROSPECTIVE CONTRACTORS" WHICH ARE SET OUT IN ASPR 1-903.1/III), WHICH INCLUDE A REQUIREMENT FOR A SATISFACTORY RECORD OF PERFORMANCE ON PRIOR CONTRACTS.

BASED UPON THE FACTS AND CIRCUMSTANCES RECITED ABOVE, WE SEE NO VALID BASIS UPON WHICH TO DISAGREE WITH THE CONTRACTING OFFICER'S CONCLUSION THAT YOU DID NOT MEET THE MINIMUM STANDARDS FOR RESPONSIBLE PROSPECTIVE CONTRACTORS.

WITH REFERENCE TO THE CAPABILITY OF MINE SAFETY APPLIANCES COMPANY TO PRODUCE THE INVOLVED ITEMS AND MAKE TIMELY DELIVERY, THE RECORD INDICATES THAT THIS COMPANY, WITH ITS EXTENSIVE MANUFACTURING FACILITIES, ENGINEERING CAPABILITIES AND PRODUCTION ENGINEERING KNOW HOW IS WELL EQUIPPED AND QUALIFIED TO PRODUCE THE KITS AND IS HIGHLY KNOWLEDGEABLE WITH RESPECT THERETO, HAVING PREVIOUSLY PRODUCED THE MAJOR COMPONENT ITEMS AND DELIVERED THEM TO THE ARMY ON RELATED KIT JOBS. AS TO TIME OF DELIVERY, MINE SAFETY APPLIANCES COMPANY HAS AGREED TO COMPLETE DELIVERY OF ALL ITEMS BY FEBRUARY 1, 1966, AS REQUIRED BY THE INVITATION.

FOR THE REASONS STATED, WE WOULD NOT BE JUSTIFIED IN QUESTIONING THE AWARD AS MADE, AND YOUR PROTEST UNDER INVITATION FOR BIDS NO. AMC/A/ 18- 035-65-965 MUST THEREFORE BE DENIED.

WITH REFERENCE TO YOUR LETTER OF JULY 15, 1965, IN WHICH YOU PROTEST AGAINST AN AWARD TO ANY OTHER BIDDER UNDER INVITATION FOR BIDS NO. AMC/A/- 18-035-65-065 MUST THEREFORE BE DENIED.

WITH REFERENCE TO YOUR LETTER OF JULY 15, 1965, IN WHICH YOU PROTEST AGAINST AN AWARD TO ANY OTHER BIDDER UNDER INVITATION FOR BIDS NO. AMC/A/- 18-035-65-697, DATED JUNE 3, 1965, ALSO ISSUED AT EDGEWOOD ARSENAL, THE DEPARTMENT OF THE ARMY HAS REPORTED THAT YOUR BID UNDER THAT INVITATION WAS ALSO REJECTED FOR FAILURE TO QUALIFY AS A RESPONSIBLE PROSPECTIVE CONTRACTOR, AND THAT SUCH REJECTION WAS ALSO BASED UPON YOUR PERFORMANCE RECORD AS SET FORTH HEREINABOVE. ADDITIONALLY, WE HAVE BEEN ADVISED THAT THIS PURCHASE WAS BEING MADE FOR THE DEPARTMENT OF THE NAVY; THAT AFTER AWARDS HAD BEEN MADE TO TWO OTHER BIDDERS IT WAS DETERMINED THAT SUFFICIENT FUNDS WERE NOT AVAILABLE FOR THE PROCUREMENT; AND THAT THE AWARDS WERE THEREFORE CANCELED AND NO PURCHASE HAS BEEN MADE. IN VIEW THEREOF, IT WOULD APPEAR THAT A DECISION ON THE MERITS OF YOUR PROTEST WOULD BE OF ACADEMIC VALUE ONLY, AND WE MUST DECLINE TO RENDER A DECISION ON THAT BASIS.