B-158484, MAY 4, 1966

B-158484: May 4, 1966

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INCORPORATED: FURTHER REFERENCE IS MADE TO YOUR TELEFAX DATED FEBRUARY 8 AND LETTER DATED FEBRUARY 9. THE EQUIPMENT WAS TO BE MANUFACTURED IN ACCORDANCE WITH BUREAU OF NAVAL WEAPONS SPECIFICATION WS 5087 DATED SEPTEMBER 14. THIS MEETING WAS CONSIDERED ESSENTIAL BECAUSE OF THE COMPLEXITY OF THE PRODUCTION TASK AND THE EXTENSIVE NATURE OF THE SPECIFICATIONS. THE RECORD SHOWS THAT YOUR COMPANY WAS NOT IN ATTENDANCE AT THE MEETING. WHICH WAS DEVELOPED AS THE RESULT OF CHANGES SUGGESTED AT THE BIDDERS' CONFERENCE. THE BIDS RECEIVED WERE OPENED ON DECEMBER 28 WITH THE FOLLOWING RESULTS: CHART UNIT PRICE UNIT PRICE BIDDER ITEM 1 ITEM 2 TOTAL FIXED PRICE QUE ENTERPRISES. 721.50 AS CAN BE SEEN FROM THE ABOVE YOUR COMPANY WAS THE LOWEST BIDDER ON THE PROCUREMENT.

B-158484, MAY 4, 1966

TO QUE ENTERPRISES, INCORPORATED:

FURTHER REFERENCE IS MADE TO YOUR TELEFAX DATED FEBRUARY 8 AND LETTER DATED FEBRUARY 9, 1966, PROTESTING THE AWARD OF A CONTRACT BY THE UNITED STATES NAVY PURCHASING OFFICE, LOS ANGELES, CALIFORNIA, TO PHILADELPHIA GEAR CORPORATION UNDER INVITATION FOR BIDS NO. 123-54819A 66.

THE INVITATION, ISSUED ON NOVEMBER 5, 1965, COVERED NINETY-ONE ELEVATION DRIVE SYSTEM ASSEMBLIES FOR AN/SPG-55A/B SHIPBOARD FIRE CONTROL RADAR, SIXTEEN SETS OF INSTALLATION TOOLS, AND AN OPTION, EXERCISABLE WITHIN SIX MONTHS FROM THE CONTRACT DATE, TO PURCHASE TEN ADDITIONAL ASSEMBLIES. THE EQUIPMENT WAS TO BE MANUFACTURED IN ACCORDANCE WITH BUREAU OF NAVAL WEAPONS SPECIFICATION WS 5087 DATED SEPTEMBER 14, 1965, AND APPROXIMATELY 350 DETAILED DRAWINGS.

TWENTY-TWO COMPANIES REQUESTED COPIES OF THE BIDDING PAPERS IN RESPONSE TO A PRE-INVITATION NOTICE PUBLISHED IN THE COMMERCE BUSINESS DAILY ON SEPTEMBER 23. THE INVITATION NOTIFIED PROSPECTIVE BIDDERS OF A MEETING TO BE HELD ON NOVEMBER 18 AT THE UNITED STATES NAVAL SHIP MISSILE SYSTEMS ENGINEERING STATION, PORT HUENEME, CALIFORNIA. THIS MEETING WAS CONSIDERED ESSENTIAL BECAUSE OF THE COMPLEXITY OF THE PRODUCTION TASK AND THE EXTENSIVE NATURE OF THE SPECIFICATIONS. THE RECORD SHOWS THAT YOUR COMPANY WAS NOT IN ATTENDANCE AT THE MEETING.

AMENDMENT NO. 1, ISSUED ON DECEMBER 8, 1965, INCORPORATED A REVISED SPECIFICATION, SPECIFICATION WS 5087A DATED NOVEMBER 24, 1965, WHICH WAS DEVELOPED AS THE RESULT OF CHANGES SUGGESTED AT THE BIDDERS' CONFERENCE.

THE BIDS RECEIVED WERE OPENED ON DECEMBER 28 WITH THE FOLLOWING RESULTS:

CHART

UNIT PRICE UNIT PRICE

BIDDER ITEM 1 ITEM 2 TOTAL FIXED PRICE QUE ENTERPRISES, INC. $10,886.00 $2,650.00 $1,033,026.00 PHILADELPHIA GEAR CORP. 14,450.00 9,415.00 1,465,590.00 (AWARD) REEVES INSTRUMENT CO. 15,339.00 7,519.00 1,516,153.00 SPERRY GYROSCOPE CO. 15,526.00 4,981.00 1,492,562.00 FMC CORPORATION 16,932.82 2,552.18 1,581,721.50 AS CAN BE SEEN FROM THE ABOVE YOUR COMPANY WAS THE LOWEST BIDDER ON THE PROCUREMENT. BECAUSE OF THE COMPLEXITY AND MAGNITUDE OF THE WORK, THE DEFENSE CONTRACT ADMINISTRATION SERVICES REGION, DALLAS, TEXAS, WAS REQUESTED TO CONDUCT A PRE-AWARD SURVEY TO ASSIST THE CONTRACTING OFFICER IN ARRIVING AT A DETERMINATION OF YOUR COMPANY'S RESPONSIBILITY. THE CONTRACTING OFFICER WAS TELEPHONICALLY ADVISED ON JANUARY 24, 1966, THAT THE RESULTS OF THE SURVEY WERE NEGATIVE AND THAT YOUR CONCERN WAS FOUND TO BE INADEQUATE FOR THE PURPOSES OF THIS CONTRACT IN THE AREAS OF TECHNICAL PRODUCTION, FINANCIAL CAPABILITY, CONTRACT AND SUB CONTRACT MANAGEMENT, AVAILABILITY OF LABOR, AND ABILITY TO MEET THE MANDATORY DELIVERY SCHEDULE.

THE ELEVATION DRIVE SYSTEM ASSEMBLIES EACH CONTAIN APPROXIMATELY 510 COMPONENT PARTS INCLUDING SUCH CRITICAL ITEMS AS PRECISION GEARS, CASTINGS, AND MAGNETIC CLUTCH. IT WAS DISCOVERED THAT THE ONLY WORK YOU WERE PREPARED TO PERFORM AT YOUR OWN FACILITIES WAS THE MACHINING OF THE CASTINGS AND THE GEAR BOX ASSEMBLIES. YOU HAD CONTEMPLATED THE SUBCONTACTING OF MOST OTHER PHASES OF THE EFFORT, INCLUDING THE BULK OF THE TESTING. IT WAS ALSO ASCERTAINED THAT THE MAGNITUDE OF THE CONTRACT WAS DOUBLE THAT OF YOUR TOTAL GROSS SALES DURING THE YEAR 1965. THE FACTS PRESENTED INDICATE THAT A CONTRACT OF THIS TECHNICAL AND MONETARY MAGNITUDE HAD NEVER BEFORE BEEN ATTEMPTED BY QUE. THE MATTER WAS CONSIDERED BY A PRE-AWARD SURVEY BOARD, CONSISTING OF FIVE MEMBERS, AND IT WAS THEIR OPINION THAT YOUR FIRM WAS NOT QUALIFIED TO PERFORM THE REQUIRED WORK.

ON JANUARY 24 NPOLA NOTIFIED THE REQUIRING INSTALLATION OF THE RESULTS OF THE PRE-AWARD SURVEY AND INDICATED THAT THE MATTER WOULD HAVE TO BE SUBMITTED TO THE SMALL BUSINESS ADMINISTRATION FOR CONSIDERATION OF THE ISSUANCE TO YOUR COMPANY OF A CERTIFICATE OF COMPETENCY. NPOLA WAS INFORMED THAT ANY FURTHER DELAY IN AWARD WOULD BE DETRIMENTAL TO A CRITICAL ORDALT 6161 SHIP CONVERSION PROGRAM SCHEDULE, THE TIMELY COMPLETION OF WHICH WAS DEEMED VITAL TO THE CONDUCT OF OVERSEAS OPERATIONS BY THE NAVY. THE CONTRACTING OFFICER EXECUTED A DETERMINATION OF URGENCY PURSUANT TO ARMED SERVICES PROCUREMENT REGULATION 1-705./C) (IV) AND, ON FEBRUARY 7, 1966, AWARDED THE CONTRACT TO PHILADELPHIA GEAR CORPORATION AS THE LOWEST RESPONSIVE AND RESPONSIBLE BIDDER CAPABLE OF MEETING THE MANDATORY DELIVERY SCHEDULE.

WE FIND NOTHING IN THE RECORD BEFORE US WHICH WOULD WARRANT US TO QUESTION THE CONTRACTING OFFICER'S CONCLUSION THAT IT WOULD NOT HAVE BEEN IN THE BEST INTERESTS OF THE GOVERNMENT TO MAKE THE AWARD TO YOU. IT IS A PRECONDITION TO THE AWARD OF ANY GOVERNMENT CONTRACT THAT THE PROSPECTIVE CONTRACTOR BE FOUND RESPONSIBLE TO PERFORM THE PARTICULAR WORK INVOLVED. 10 U.S.C. 2305 (C); ASPR 1-92 AND 1-904. THE PRIMARY RESPONSIBILITY FOR THE EVALUATION OF A PROPOSED CONTRACTOR'S QUALIFICATIONS IS UPON THE PROCUREMENT AGENCY AND, IN THE ABSENCE OF CONVINCING EVIDENCE OF BAD FAITH OR OF LACK OF A REASONABLE BASIS FOR THE DETERMINATION MADE, THERE IS NO BASIS UPON WHICH WE COULD OBJECT TO THE CONCLUSIONS OF THE AGENCY IN THE MATTER. 37 COMP. GEN. 798.