B-159642, OCT. 12, 1966

B-159642: Oct 12, 1966

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INC.: REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER OF JULY 6 AND JULY 26. DELIVERY OF THE FIRST POD WAS REQUIRED ON OCTOBER 1. BIDS WERE OPENED ON MAY 25. 3 BIDS WERE RECEIVED. OPPORTUNITIES UNLIMITED WAS THE LOW BIDDER. THIS RECOMMENDATION WAS SUPPORTED BY THE FOLLOWING FINDINGS: (A) EFFORTS TO OBTAIN FINANCIAL DATA WERE UNSUCCESSFUL. REFERENCE WAS MADE TO A PRIOR REPORT DATED MAY 26. IN CONNECTION WITH A DIFFERENT PROCUREMENT ON WHICH A RECOMMENDATION OF NO-AWARD WAS MADE. THE FINANCIAL POSITION WAS FOUND TO BE EXTREMELY PRECARIOUS. THE CURRENT ASSET TO CURRENT LIABILITY RATIO WAS 0.4 TO 1. THE FIRM WAS FOUND TO HAVE BEEN INCURRING LOSSES AND CREDIT INFORMATION AVAILABLE SUGGESTED TRADE PAYMENT WEAKNESS.

B-159642, OCT. 12, 1966

TO OPPORTUNITIES UNLIMITED, INC.:

REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER OF JULY 6 AND JULY 26, RESPECTIVELY, PROTESTING AGAINST THE AWARD OF A CONTRACT TO ANY OTHER BIDDER UNDER INVITATION FOR BIDS NO. N00163-66-N-0015 ISSUED MAY 9, 1966, BY THE UNITED STATES NAVAL AVIONICS FACILITY, INDIANAPOLIS, INDIANA.

THE IFB PROVIDED FOR THE FURNISHING OF TWO INSTRUMENTATION POD ASSEMBLIES AND INCLUDED PROVISIONS FOR A STRUCTURAL LAYOUT, DETAIL AND ASSEMBLY DRAWINGS. DELIVERY OF THE FIRST POD WAS REQUIRED ON OCTOBER 1, 1966, WITH DELIVERY OF THE SECOND POD REQUIRED ON NOVEMBER 1, 1966. BIDS WERE OPENED ON MAY 25, 1966, AND 3 BIDS WERE RECEIVED. OPPORTUNITIES UNLIMITED WAS THE LOW BIDDER.

A PRE-AWARD SURVEY REPORT FROM THE DEFENSE CONTRACT ADMINISTRATION SERVICES DISTRICT, GARDEN CITY, NEW YORK, DATED JUNE 9, 1966, RECOMMENDED THAT AN AWARD NOT BE MADE TO OPPORTUNITIES UNLIMITED BASED ON THE FACT THAT THE PROSPECTIVE CONTRACTOR LACKED THE NECESSARY FINANCES, EXPERIENCE AND TECHNICAL SKILLS, TECHNICAL KNOW-HOW AND FACILITIES, AND TECHNICAL EQUIPMENT. THIS RECOMMENDATION WAS SUPPORTED BY THE FOLLOWING FINDINGS: (A) EFFORTS TO OBTAIN FINANCIAL DATA WERE UNSUCCESSFUL, AND REFERENCE WAS MADE TO A PRIOR REPORT DATED MAY 26, 1966, IN CONNECTION WITH A DIFFERENT PROCUREMENT ON WHICH A RECOMMENDATION OF NO-AWARD WAS MADE. AS EVIDENCED BY THE DATE AVAILABLE AT THAT TIME, THE FINANCIAL POSITION WAS FOUND TO BE EXTREMELY PRECARIOUS. THE CURRENT ASSET TO CURRENT LIABILITY RATIO WAS 0.4 TO 1, LIABILITIES TO NET WORTH 8.7 TO 1. THE FIRM WAS FOUND TO HAVE BEEN INCURRING LOSSES AND CREDIT INFORMATION AVAILABLE SUGGESTED TRADE PAYMENT WEAKNESS. THERE WAS NO INFORMATION AVAILABLE TO INDICATE THAT THE FIRM HAD IMPROVED THEIR POSITION SINCE THAT SURVEY OR HAD MANAGED TO OBTAIN ACCESS TO FUNDS. (B) THE PROSPECTIVE SUPPLIER WAS NOT FOUND TO HAVE ADEQUATE FACILITIES AND EQUIPMENT TO EMPLOY THE MANUFACTURING AND OPERATION TECHNIQUES REQUIRED TO FABRICATE THE COMPONENT ITEMS. (C) THERE WAS A REQUIREMENT FOR SPECIAL TOOLING TO BE DEVELOPED. OPPORTUNITIES UNLIMITED'S METHOD OF APPROACH TO DEVELOP SUCH TOOLING WAS FOUND TO BE NEBULOUS AND INDICATED THAT TOOLING WOULD BE PRODUCED BY THE TRIAL AND ERROR METHOD. (D) THE TYPE AND CONDITION OF THE BASIC MATERIALS HAD NOT BEEN DETERMINED AND THE STRUCTURAL LAYOUT AND STRESS ANALYSIS DATA HAD NOT BEEN INVESTIGATED. (E) THE PROSPECTIVE SUPPLIER HAD MADE NO DEFINITE ARRANGEMENTS OR PLANS FOR SUBCONTRACTING OR OTHERWISE OBTAINING EQUIPMENT AND FACILITIES, ALTHOUGH THE BIDDER DID NOT HAVE THE EQUIPMENT AND FACILITIES TO PRODUCE THE COMPONENTS. (F) THE BIDDER WAS FOUND NOT TO EMPLOY ANY FULL TIME ENGINEERING PERSONNEL OF THE TYPE REQUIRED TO PERFORM THE PROPOSED CONTRACT AND IT WAS FOUND TO HAVE HAD NO PREVIOUS EXPERIENCE IN THIS TYPE OF COMPLEX FABRICATION. BASED ON THE FOREGOING, THE CONTRACTING OFFICER ON JUNE 17, 1966, MADE A DETERMINATION THAT OPPORTUNITIES UNLIMITED COULD NOT BE CONSIDERED A RESPONSIBLE BIDDER UNDER THIS IFB.

SINCE OPPORTUNITIES UNLIMITED HAD CERTIFIED IN ITS BID THAT IT WAS A SMALL BUSINESS CONCERN, ON JUNE 21, 1966, THE QUESTION OF ITS CAPACITY AND CREDIT WAS REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR FINAL DETERMINATION. ON JULY 5, 1966, THE SBA INFORMED THE CONTRACTING OFFICER THAT OPPORTUNITIES UNLIMITED DID NOT MEET THE CRITERIA OF A SMALL BUSINESS CONCERN, ELIGIBLE FOR CERTIFICATE OF COMPETENCY ACTION, BECAUSE SBA RECORDS INDICATED THAT THIS FIRM WAS A NONPROFIT ORGANIZATION EMPLOYING PART-TIME, PHYSICALLY HANDICAPPED PERSONS. IN THIS CONNECTION IT SHOULD BE POINTED OUT THAT IN ORDER TO BE ELIGIBLE FOR SMALL BUSINESS CONCERN BENEFITS A FIRM MUST BE A BUSINESS ENTITY ORGANIZED FOR PROFIT. SEE ASPR 1-701.1 (A) (1). ON JULY 22, 1966, AWARD WAS MADE TO THE NEXT LOW BIDDER.

ASIDE FROM THE FACT THAT THE PROCEDURES RELATIVE TO THE ISSUANCE OF A CERTIFICATE OF COMPETENCY BY THE SBA WERE NOT AVAILABLE TO YOUR FIRM, THE QUESTION OF RESPONSIBILITY IS A MATTER AS TO WHICH ASPR 1 904 REQUIRES THE CONTRACTING OFFICER TO MAKE AN AFFIRMATIVE DETERMINATION THAT THE PROSPECTIVE CONTRACTOR IS RESPONSIBLE WITHIN THE MEANING OF ASPR 1-902 AND 1-903. THERE IS FOR APPLICATION HERE THE GENERAL RULE THAT THE QUESTION AS TO RESPONSIBILITY AND CAPABILITY OF THE BIDDER ON A PROPOSED GOVERNMENT CONTRACT IS A MATTER PRIMARILY FOR DETERMINATION BY THE CONTRACTING AGENCY AND SUCH DETERMINATION WHEN MADE WILL NOT BE QUESTIONED BY THIS OFFICE IN THE ABSENCE OF A REASONABLE BASIS THEREFOR. 37 COMP. GEN. 430.

BASED UPON THE CIRCUMSTANCES AS SHOWN BY THE SURVEY REPORT WE ARE UNABLE TO CONCLUDE THAT THERE WAS NO REASONABLE BASIS FOR THE CONTRACTING OFFICER'S DETERMINATION. ACCORDINGLY, YOUR PROTEST MUST BE DENIED.