B-159862, OCT. 26, 1966

B-159862: Oct 26, 1966

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THE EQUIPMENT IS DESCRIBED IN MILITARY SPECIFICATIONS AS "A PORTABLE WATERTIGHT DEVICE CAPABLE OF MEASURING GAMMA RADIATION RATES BETWEEN 1 AND 10. PRODUCTION DELIVERIES OF THE EQUIPMENT ARE SCHEDULED BETWEEN DECEMBER 1967 AND DECEMBER 1968 AND PREPRODUCTION EQUIPMENT IS SCHEDULED FOR DELIVERY ON FEBRUARY 1. IS FURTHER NOTED THAT THIS IS THE FIRST PROCUREMENT OF PRODUCTION QUANTITIES FOR THIS EQUIPMENT. YOUR PROTEST IS MADE ON SEVERAL GROUNDS WHICH RELATE PRINCIPALLY TO THE GOVERNMENT'S ACTIONS IN EVALUATING YOUR FIRM'S RESPONSIBILITY. YOU ALLEGE THAT NAVY IMPROPERLY INCLUDED MATERIAL FROM ITS RECORDS WHEN THE QUESTION OF YOUR CAPACITY AND CREDIT WAS REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR ISSUANCE OF A CERTIFICATE OF COMPETENCY.

B-159862, OCT. 26, 1966

TO ELECTRO NEUTRONICS, INC.:

WE REFER TO YOUR LETTER OF AUGUST 9, 1966, PROTESTING AGAINST AN AWARD TO OTHER THAN ELECTRO NEUTRONICS, INC. (ENI), UNDER INVITATION FOR BIDS (IFB) NO. 600-1012-66 ISSUED BY THE U.S. NAVY PURCHASING OFFICE, WASHINGTON, D.C.

THE INVITATION REQUESTED BIDS FOR 950 UNITS OF AN/PDR-65 RADIACMETERS FOR INSTALLATION ABOARD VARIOUS NAVY OPERATIONAL VESSELS. THE EQUIPMENT IS DESCRIBED IN MILITARY SPECIFICATIONS AS "A PORTABLE WATERTIGHT DEVICE CAPABLE OF MEASURING GAMMA RADIATION RATES BETWEEN 1 AND 10,000 RAD/HR AND INTEGRATING DOSES UP TO 10,000 RAD.' PRODUCTION DELIVERIES OF THE EQUIPMENT ARE SCHEDULED BETWEEN DECEMBER 1967 AND DECEMBER 1968 AND PREPRODUCTION EQUIPMENT IS SCHEDULED FOR DELIVERY ON FEBRUARY 1, 1967. IS FURTHER NOTED THAT THIS IS THE FIRST PROCUREMENT OF PRODUCTION QUANTITIES FOR THIS EQUIPMENT.

YOUR PROTEST IS MADE ON SEVERAL GROUNDS WHICH RELATE PRINCIPALLY TO THE GOVERNMENT'S ACTIONS IN EVALUATING YOUR FIRM'S RESPONSIBILITY. ADDITIONALLY, YOU ALLEGE THAT NAVY IMPROPERLY INCLUDED MATERIAL FROM ITS RECORDS WHEN THE QUESTION OF YOUR CAPACITY AND CREDIT WAS REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR ISSUANCE OF A CERTIFICATE OF COMPETENCY.

ALTHOUGH YOUR FIRM (A SMALL BUSINESS CONCERN) HAS SUBMITTED THE LOWEST RESPONSIVE BID, THE CONTRACTING OFFICER PROPOSES TO AWARD THE CONTRACT TO THE SECOND LOWEST BIDDER SINCE HE IS UNABLE TO MAKE THE AFFIRMATIVE DETERMINATION OF RESPONSIBILITY REQUIRED BY THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1-904.1. THE CONTRACTING OFFICER, AFTER EVALUATING ENI'S RESPONSIBILITY IN ACCORDANCE WITH THE MINIMUM STANDARDS IN ASPR 1- 903, CONCLUDED THAT IT HAD NEITHER THE CAPACITY NOR CREDIT TO ADEQUATELY PERFORM ON THE PROPOSED CONTRACT. PURSUANT TO ASPR 1-705.4 (C) NAVY THEREFORE SUBMITTED THE QUESTION OF ENI'S COMPETENCY, TOGETHER WITH NAVY'S SURVEY FINDINGS AS REQUIRED BY ASPR 1-705.4 (D), FOR SBA'S DETERMINATION, BUT NAVY'S LETTER OF SUBMISSION TO THE SBA APPEARS TO TREAT ONLY FINANCIAL AND CREDIT ASPECTS OF ENI'S COMPETENCE. WHILE YOU ALLEGE IT IS INCONSISTENT THAT THE CONTRACTING OFFICER DETERMINED ENI WAS NOT FINANCIALLY QUALIFIED TO PERFORM THE PROPOSED CONTRACT, WHEREAS THE SBA DISAGREED WITH SUCH DETERMINATION BUT REFUSED TO ISSUE A CERTIFICATE OF COMPETENCY BECAUSE OF ENI'S POOR PERFORMANCE RECORD ON CURRENT CONTRACTS, IT IS APPARENT FROM THE RECORD THAT BOTH NAVY AND SBA AGREED ENI WAS INCAPABLE OF ADEQUATELY PERFORMING ON THE PROPOSED CONTRACT BECAUSE OF ITS POOR PERFORMANCE RECORD ON CURRENT CONTRACTS. SBA'S REFUSAL TO ISSUE A CERTIFICATE OF COMPETENCY WAS AN AFFIRMANCE OF NAVY'S DETERMINATION, AND MUST BE REGARDED AS PERSUASIVE WITH RESPECT TO NAVY'S UNFAVORABLE DETERMINATION AS TO YOUR CAPACITY TO PERFORM THE CONTRACT. SEE 39 COMP. GEN. 705 AND B-159247, AUGUST 26, 1966.

CONCERNING YOUR CONTENTION THAT AWARD WAS DELAYED TO A TIME LEAST ADVANTAGEOUS TO ENI, AND THAT ENI WAS ALLOWED INSUFFICIENT TIME IN WHICH TO PRESENT REQUIRED ADDITIONAL DATA, THE RECORD DOES NOT INDICATE THAT ANY REQUEST WAS MADE FOR ADDITIONAL DATA TO SUPPORT YOUR CAPABILITY TO PRODUCE THE REQUIRED EQUIPMENT WHICH, IF SUPPLIED, WOULD HAVE REQUIRED A REVERSAL OF NAVY'S DETERMINATION REGARDING YOUR CAPABILITY. FURTHERMORE, THE DELAY IN AWARD RESULTED FROM THE FACT THAT THE PROCUREMENT AGENCY FOUND IT NECESSARY TO PURSUE THE MATTER OF YOUR RESPONSIBILITY FURTHER TO THE END THAT IT WAS FINALLY DETERMINED YOU WERE NOT RESPONSIBLE. IN OUR OPINION SUCH ACTION IS REQUIRED FOR THE PROTECTION OF THE GOVERNMENT'S OWN INTERESTS AND CASTS NO DOUBTS ON THE LEGALITY OF THE PROPOSED AWARD TO THE SECOND LOWEST BIDDER.

CONCERNING YOUR OBJECTION TO AN ALLEGED ABRIDGMENT OF YOUR "RIGHTS TO AN IMPARTIAL HEARING" IN THAT ENI WAS NOT AFFORDED AN OPPORTUNITY TO MEET ITS "DETRACTORS" AND WAS INSTEAD JUDGED IN ABSENTIA, WE REFER TO OUR DECISION TO YOU OF AUGUST 26, 1966, B-159247, WHEREIN THE FOLLOWING WAS STATED IN REPLY TO AN IDENTICAL ALLEGATION:

"* * * TO OUR KNOWLEDGE THERE IS NO STATUTORY OR REGULATORY REQUIREMENT FOR A HEARING IN SUCH A MATTER AND SINCE THERE IS NO EVIDENCE THAT THE UNFAVORABLE FINDINGS EITHER WERE ARRIVED AT IN BAD FAITH OR WERE NOT BASED ON SUBSTANTIAL EVIDENCE, THIS OBJECTION FURNISHES NO LEGAL BASIS FOR OUR OFFICE TO QUESTION THE ADMINISTRATIVE FAILURE TO AFFORD YOU AN OPPORTUNITY TO BE HEARD.'

CONCERNING YOUR OBJECTION TO NAVY'S ACTION IN PROVIDING THE SBA WITH ITS FILE OF FACTS TOGETHER WITH ITS CONCLUSIONS, SUCH ACTION WAS IN ACCORD WITH, AND REQUIRED BY, THE PROVISIONS OF ASPR 1-705.4 (D), AND WE THEREFORE SEE NO VALID BASIS FOR YOUR OBJECTION.

IN VIEW OF THE FOREGOING, WE FIND NO LEGAL BASIS TO QUESTION THE ACTION TAKEN BY THE ADMINISTRATIVE OFFICE IN REFUSING TO AWARD A CONTRACT ON THE REFERENCED IFB TO YOUR FIRM, AND YOUR PROTEST MUST THEREFORE BE DENIED.