B-157288, SEP. 13, 1965

B-157288, SEP. 13, 1965

TO ACME AMBULANCE SERVICE:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 9, 1965, PROTESTING AN AWARD OF A CONTRACT TO PERFORM AMBULANCE SERVICES MADE ON JUNE 25, 1965, TO CHARLES W. SIEVERS AND LOLA E. SIEVERS, DOING BUSINESS AS COMMUNITY AMBULANCE SERVICE, UNDER INVITATION FOR BIDS NO. 66-9 ISSUED BY THE VETERANS ADMINISTRATION HOSPITAL, KANSAS CITY, MISSOURI.

BY LETTER OF JULY 26 THE DIRECTOR, SUPPLY MANAGEMENT SERVICE, HAS FORWARDED A FULL REPORT ON THE MATTER. AN ABSTRACT OF BIDS INCLUDED THEREIN SHOWS THAT BIDS WERE OPENED ON JUNE 8, 1965, THAT THE BID OF COMMUNITY AMBULANCE SERVICE WAS THE LOWEST RECEIVED, AND THAT YOUR BID QUOTED THE HIGHEST PRICES OF THE FIVE BIDS SUBMITTED.

COMMUNITY AMBULANCE SERVICE WAS DIRECTED TO, AND DID FURNISH, THE HOSPITAL INSURANCE CERTIFICATES DATED JUNE 21 AND JUNE 23 CONSTITUTION EVIDENCE OF COMPLIANCE WITH THE INSURANCE PROVISIONS SET FORTH AT PARAGRAPH 12B OF THE INVITATION. THESE CERTIFICATES DEMONSTRATE THAT WORKMEN'S COMPENSATION AND EMPLOYERS' LIABILITY POLICY NO. WC 393027 IN THE AMOUNT OF $25,000 HAS BEEN ISSUED BY THE BITUMINOUS CASUALTY CORPORATION TO CHARLES W. SIEVERS AND LOLA E. SIEVERS, DOING BUSINESS AS COMMUNITY AMBULANCE SERVICE. THEY CERTIFY ALSO THAT THE EMPIRE FIRE AND MARINE INSURANCE COMPANY HAS CAUSED TO BE ISSUED POLICIES COVERING SEVERAL VEHICLES FOR THE RISKS OF AUTOMOBILE, BODILY INJURY AND PROPERTY DAMAGE, THE FORMER IN THE AMOUNTS OF $100,000 FOR EACH PERSON AND $300,000 FOR EACH ACCIDENT; THE LATTER IN THE AMOUNT OF $25,000 FOR EACH ACCIDENT. MEMORANDUM OF REINSURANCE STATES THAT THE CONTINENTAL CASUALTY COMPANY HAS TAKEN A POLICY ON THE SAME INSURED WHICH EXTENDS THE COVERAGE OF THE EMPIRE FIRE AND MARINE INSURANCE COMPANY POLICIES TO $500,000 FOR EACH ACCIDENT OR OCCURRENCE IN THE CATEGORY OF BODILY INJURY--- AUTOMOBILE.'

THE EVIDENCE DESCRIBED ABOVE AND FURNISHED BY COMMUNITY AMBULANCE SERVICE APPEARS TO US TO BE GENERALLY IN ACCORD WITH THE PROVISIONS OF PARAGRAPH 12B AND THE INSURANCE COVERAGES OBTAINED IN ALL CASES EQUAL OR EXCEED THE AMOUNTS STIPULATED THEREIN. BY RECITATION IN THE INVITATION A DEMONSTRATION OF SATISFACTORY INSURANCE COVERAGE WAS MADE A CONDITION PRECEDENT TO THE AWARD OF A CONTRACT BUT THE LANGUAGE DOES NOT JUSTIFY, AND THE VETERANS ADMINISTRATION DOES NOT INTERPRET IT TO MEAN THAT SUCH EVIDENCE MUST ACCOMPANY THE BID. WE ARE INFORMED BY THE PROCURING OFFICIALS THAT THE REQUIREMENT HAS BEEN CONSTRUED TO MEAN THAT ONLY THE BIDDER TO WHOM AWARD IS CONTEMPLATED IS EXPECTED TO PROVIDE THE NEWLY REQUIRED AMOUNT OF INSURANCE COVERAGE OF $500,000 PER ACCIDENT. IT WOULD IMPOSE AN ONEROUS AND UNNECESSARY BURDEN TO REQUIRE ALL BIDDERS TO OBTAIN AN UNUSUALLY HIGH INSURANCE COVERAGE JUST FOR THE PURPOSE OF COMPETING FOR THIS AWARD.

FURTHERMORE, THE PURPOSE OF AN INSURANCE REQUIREMENT IS TO HOLD THE GOVERNMENT HARMLESS AGAINST THE RISKS INVOLVED IN PERFORMANCE OF THE CONTRACT. THE ABILITY TO SATISFY THE REQUIREMENT IS AN ELEMENT OF A BIDDER'S RESPONSIBILITY AND NOT OF THE RESPONSIVENESS OF HIS BID. IN THE ABSENCE OF EVIDENCE OF ARBITRARINESS, THE ACCOUNTING OFFICERS OF THE GOVERNMENT ARE BOUND BY A CONTRACTING OFFICER'S DETERMINATION OF THE SUCCESSFUL BIDDER'S RESPONSIBILITY AND CAPABILITY. 38 COMP. GEN. 131; 37 ID. 430.

SINCE AWARD HAS BEEN MADE TO THE LOWEST BIDDER, AND SINCE THERE HAS BEEN DEMONSTRATED SATISFACTORY AND TIMELY COMPLIANCE WITH THE INSURANCE REQUIREMENTS STATED IN THE INVITATION, WE PERCEIVE NO BASIS UPON WHICH TO PREDICATE AN OBJECTION TO THE CONTRACT LET IN THIS INSTANCE.