Skip to main content

B-160624, MAY 24, 1967

B-160624 May 24, 1967
Jump To:
Skip to Highlights

Highlights

THAT THE CONTRACTING OFFICER'S DETERMINATION OF YOUR NONRESPONSIBILITY IS ERRONEOUS. THAT THE CONTRACTING OFFICER'S DETERMINATION OF URGENT NEED WAS A DELIBERATE AND UNJUSTIFIABLE MANEUVER TO AVOID SUBMITTING THE QUESTION OF PDI'S COMPETENCY TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR REVIEW. IT IS REPORTED THAT THE PURPOSE OF A CALIBRATION PUBLICATION IS TO PROVIDE DETAILED INSTRUCTIONS FOR VERIFICATION OF THE OPERATION OF A TEST INSTRUMENT WITHIN ITS PRESCRIBED ACCURACY. THE TEST INSTRUMENTS HERE INVOLVED ARE UTILIZED TO ESTABLISH THE WEAPONS SYSTEM ACCURACY AND COMBAT READINESS OF THE ARMY MATERIEL. DIVIDED AMONG 40 CATEGORIES FOR EACH OF WHICH A FIXED UNIT PRICE WAS REQUESTED. POLARAD TSA-W 10 - - SPECTRUM (*) "THE TYPE OF INSTRUMENT LISTED IN EACH GROUP IS DETERMINED BY THE COMPLEXITY OF THE ITEM NOT THE NOUN NAME.

View Decision

B-160624, MAY 24, 1967

TO PROJECT DESIGNS, INCORPORATED:

WE REFER TO YOUR TELEGRAM OF JANUARY 3, 1967, AND SUPPORTING LETTERS OF JANUARY 9, FEBRUARY 8, AND APRIL 19, 1967, AND ENCLOSURES, PROTESTING THE REJECTION BY THE DEPARTMENT OF THE ARMY OF YOUR LOW BID FOR THE PREPARATION OF CALIBRATION TECHNICAL BULLETINS AND RELATED ENGINEERING SERVICES UNDER INVITATION FOR BIDS NO. DAAA25-67 0188, ISSUED BY THE FRANKFORD ARSENAL ON SEPTEMBER 30, 1966.

YOUR PROTEST PRESENTS ESSENTIALLY TWO CONTENTIONS: FIRST, THAT THE CONTRACTING OFFICER'S DETERMINATION OF YOUR NONRESPONSIBILITY IS ERRONEOUS; AND SECOND, THAT THE CONTRACTING OFFICER'S DETERMINATION OF URGENT NEED WAS A DELIBERATE AND UNJUSTIFIABLE MANEUVER TO AVOID SUBMITTING THE QUESTION OF PDI'S COMPETENCY TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR REVIEW.

IT IS REPORTED THAT THE PURPOSE OF A CALIBRATION PUBLICATION IS TO PROVIDE DETAILED INSTRUCTIONS FOR VERIFICATION OF THE OPERATION OF A TEST INSTRUMENT WITHIN ITS PRESCRIBED ACCURACY. THE TEST INSTRUMENTS HERE INVOLVED ARE UTILIZED TO ESTABLISH THE WEAPONS SYSTEM ACCURACY AND COMBAT READINESS OF THE ARMY MATERIEL.

THE INVITATION PROPOSED TO ESTABLISH A TASK ORDER TYPE OF CONTRACT FOR A MAXIMUM QUANTITY OF 1355 ARMY CALIBRATION BULLETINS, DIVIDED AMONG 40 CATEGORIES FOR EACH OF WHICH A FIXED UNIT PRICE WAS REQUESTED. THE SCHEDULE OF THE 40 CATEGORIES APPEARED IN THE INVITATION AS FOLLOWS, NUMBERS 13 AND 39 BEING USED AS EXAMPLES:

CHART

(*) CATEGORY SAMPLE TYPE PUBLICATIONS UNIT TOTAL

"GROUP OF INSTRUMENT INSTRUMENT REQUIRED PRICE AMOUNT

0013 GENERATOR RF HEWLETT PACKARD 40 - -

694A

0039 ANALYZER, POLARAD TSA-W 10 - -

SPECTRUM

(*) "THE TYPE OF INSTRUMENT LISTED IN EACH GROUP IS DETERMINED BY THE COMPLEXITY OF THE ITEM NOT THE NOUN NAME. AN EXAMPLE, IN GROUP 13, RF GENERATOR, A NOISE SOURCE SUCH AS GENERAL RADIO TYPE1390 COULD BE PLACED IN THIS CATEGORY SINCE THE COMPLEXITY AND COST TO PREPARE A PUBLICATION TO SUPPORT THE HP694A OR GR1390 WILL BE THE SAME.

"THE GOVERNMENT WILL ORDER A TOTAL OF 1035 TECHNICAL MANUSCRIPTS IN THE CATEGORIES AND NUMBERS SET FORTH UNDER SECTION 1.1. THE GOVERNMENT WILL PLACE ORDERS FROM TIME TO TIME UTILIZING DD FORM 1155. THE MINIMUM ORDER WILL BE 40 PER MONTH. THE ANTICIPATED VOLUME OF WORK MAY REACH 100 MANUSCRIPTS PER MONTH, HOWEVER, THE TOTAL ORDERS UNDER THE CONTRACT WILL NOT EXCEED 1035 UNITS. ALL WORK WILL BE ORDERED BY THE GOVERNMENT WITHIN 18 MONTHS FROM DATE OF AWARD.'

"NOTE NO. 2

"1. THE SUCCESSFUL BIDDER AWARDED THIS CONTRACT WILL BE ASSIGNED TASK ORDERS INDICATING THE SPECIFIC INSTRUMENTS WHICH REQUIRE PUBLICATIONS, THE GROUP IN WHICH THE ITEM SHALL BE INVOICED, AND THE PUBLICATION NUMBER ASSIGNED THE ITEM. UPON RECEIPT OF THE TASK ORDER, THE CONTRACTOR SHALL SUBMIT THE PUBLICATIONS LISTED ON THE TASK ORDER IN ACCORDANCE WITH THE DELIVERY SCHEDULE.'

THE TOTAL QUANTITY WAS INCREASED TO 1355 BY AMENDMENT NO. 2 TO THE IFB. IN JUSTIFICATION OF THIS METHOD OF SOLICITATION OF BIDS ON CATEGORIES OF COMPLEXITIES, THE CONTRACTING OFFICER STATES:

"IT SHOULD ALSO BE OBSERVED THAT PRIOR TO THE RECENT PROCUREMENT ACTION (THE SUBJECT IFB-0188), CONTRACTS FOR CALIBRATION BULLETINS WERE REPEATEDLY AMENDED TO DELETE AND/OR ADD ITEMS. THESE AMENDMENTS WERE ESSENTIAL IN ORDER THAT AN ITEM MOST CRITICALLY REQUIRED AND NOT UNDER CONTRACT AT THAT PARTICULAR TIME MIGHT BE EXPEDITIOUSLY OBTAINED. IN SOME INSTANCES, AN ITEM UNDER CONTRACT BECAME OBSOLETE BY THE DATE ON WHICH A DELINQUENT CONTRACTOR WAS UNDERTAKING WORK RELATING TO THAT ITEM; OR AN ITEM WAS SO CRITICALLY REQUIRED THAT IT WAS ACCOMPLISHED IN-HOUSE AT FRANKFORD ARSENAL. IN ORDER TO AVOID MANY OF THESE PROBLEMS, IFB-0188 WAS FORMULATED TO RELATE TO 40 ITEMS OF "COMPLEXITIES," PERMITTING ORDERS TO BE ISSUED FROM TIME TO TIME RELATING TO INSTRUMENTS AS THE EXIGENCIES REQUIRED PROVIDED THE REQUIRED INSTRUMENTS WERE PROPERLY IDENTIFIED AS WITHIN ONE OF THE COMPLEXITIES UNDER THE CONTRACT AWARDED PURSUANT TO THIS IFB. THUS, THE PROCUREMENT PLAN UNDER IFB-0188 WOULD AVOID CONTRACTUAL CHANGES AND ADJUSTMENTS AND WOULD RESULT IN OBTAINING THE MOST CRITICAL BULLETINS EXPEDITIOUSLY AS REQUIRED.'

AT BID OPENING ON OCTOBER 31, 1966, THE FOLLOWING BIDS WERE RECEIVED:

PROJECT DESIGNS, INC. $ 593,300.00

RCA SERVICE COMPANY 654,669.00

GENERAL ELECTRIC COMPANY 1,020,255.00

ITT FEDERAL ELECTRIC CORP. 1,046,910.00

BURROUGHS CORPORATION 1,101,055.00

PHILCO CORPORATION 1,968,265.00

TECO INDUSTRIAL MANUALS, INC. 2,098,956.20 IT IS REPORTED THAT THE GOVERNMENT ESTIMATED THE COST OF THIS PROCUREMENT AT $943,495. SUSPECTING THAT MISTAKES HAD BEEN MADE BY THE TWO LOW BIDDERS, THE CONTRACTING OFFICER REQUESTED VERIFICATION OF THEIR RESPECTIVE BIDS. THE BIDS WERE CONFIRMED BY BOTH FIRMS.

THE RECORD ESTABLISHES THAT ON NOVEMBER 2, 1966, THE PROCURING ACTIVITY REQUESTED THE DEFENSE CONTRACT ADMINISTRATIVE SERVICES REGION (DCASR), NEW YORK, TO CONDUCT A PRE-AWARD SURVEY OF PROJECT DESIGNS, IN WHICH REPRESENTATIVES OF FRANKFORD ARSENAL WOULD PARTICIPATE. ON NOVEMBER 4, DCASR WAS FURTHER REQUESTED TO EXPEDITE THE INVESTIGATION DUE TO THE 02 PRIORITY DESIGNATED FOR THE REQUIREMENT. ON NOVEMBER 10 A SURVEY TEAM COMPRISED OF FRANKFORD ARSENAL AND DCASR PERSONNEL VISITED YOUR FACILITY AND CONFERRED WITH AUTHORIZED REPRESENTATIVES OF YOUR FIRM. ON THE BASIS OF THE REPLIES TO QUESTIONS ASKED AT THIS CONFERENCE OF MR. I. EISENBERG, PRESIDENT OF PDI AND OF MR. VEIT, PUBLICATION ENGINEER FOR PDI, THE SURVEY TEAM CONCLUDED THAT YOU LACKED ADEQUATE UNDERSTANDING OF THE SCOPE OF THE WORK REQUIRED AND OF THE MEANING OF THE CONTRACT. THESE CONCLUSIONS ARE SUPPORTED BY A MEMORANDUM OF THE INTERVIEW WHICH IS QUOTED BELOW IN PERTINENT PART:

"3. DISCUSSION OR DETAILS OF VISIT:

"B. LT. BOLAND THEN REQUESTED THAT MR. EISENBERG EXPLAIN THE CRITERIA UTILIZED TO ESTABLISH A MANHOUR REQUIREMENT FOR THE MOST COMPLEX TO THE LEAST COMPLEX ITEM LISTED ON THE IFB. MR. VEIT ESTIMATED THREE (3) HOURS FOR AMMETERS TO EIGHTY (80) MANHOURS FOR SPECTRUM ANALYZERS. THE MANHOUR ESTIMATE INCLUDED TIME TO PREPARE BLOCK DIAGRAMS, IDENTIFY ADJUSTMENT SETTINGS AND SUPPLY DETAILED INFORMATION REQUIRED BY TECHNICAL WRITERS TO PREPARE A PUBLICATION. LT. BOLAND NOTED THAT USING MR. VEIT'S ESTIMATES, THREE HUNDRED (300) ENGINEERING MANHOURS WOULD BE REQUIRED TO PREPARE ONE HUNDRED (100) PUBLICATIONS FOR THE LEAST COMPLEX ITEMS. THIS WOULD PROVIDE ONLY TWENTY (20) ENGINEERING MANHOURS FOR THE MOST COMPLEX ITEMS, (SEE INCLOSURE 1, SHEET 2). IF A TASK ORDER IS ISSUED FOR TWENTY (20) COMPLEX ITEMS, ENGINEERING MANHOURS WOULD BE AVAILABLE TO PROCESS ONLY FOUR (4) ITEMS. MR. EISENBERG THEN STATED THAT THE ESTIMATES SUBMITTED BY MR. VEIT WERE MR. VEIT'S ESTIMATES AND MR. EISENBERG ESTIMATED THAT THE MOST COMPLEX ITEM WOULD ONLY REQUIRE EIGHTY-EIGHT (88) TOTAL MANHOURS TO PREPARE A FINAL PUBLICATION. MR. EISENBERG THEN STATED THAT THIS COULD BE ACCOMPLISHED UTILIZING BASIC GENERAL PROCEDURES PRESENTLY AVAILABLE FOR ALL THE LISTED IFB CATEGORIES OF EQUIPMENT.

"C. LT. BOLAND THEN ASKED IF GENERAL PROCEDURES WERE AVAILABLE? THEN MR. EISENBERG STATED THAT THEY WERE AVAILABLE. MR. CARTY THEN REQUESTED THAT GENERAL PROCEDURES BE PROVIDED FOR CATEGORIES 35 THRU 40 AS LISTED ON THE IFB. MR. EISENBERG THEN STATED HE PLANNED TO PREPARE AND DYNAMICALLY EVALUATE GENERAL PROCEDURES FOR EACH OF THE FORTY (40) BASIC CATEGORIES LISTED IN THE IFB AT A COST OF $70,000.00. THESE PROCEDURES WOULD THEN BE AVAILABLE FOR TECHNICAL WRITING EFFORT AGAINST GOVERNMENT TASK ORDERS, AND WOULD PRECLUDE ANY FURTHER ENGINEERING EFFORT FOR REMAINDER OF THE CONTRACT.

"D. MR. EISENBERG WAS THEN INFORMED THAT THE 40 CATEGORIES OF EQUIPMENT LISTED IN THE IFB WERE LISTED TO INDICATE DEGREE OF COMPLEXITY AND NOT A SPECIFIC GROUP OF EQUIPMENT. MR. EISENBERG WAS THEN ASKED, SINCE OSCILLOSCOPES WERE NOT LISTED AS A CATEGORY ON THE IFB WOULD HE EXPECT TO SEE OSCILLOSCOPES ON A TASK ORDER? MR. EISENBERG STATED EMPHATICALLY,"NO**" HE THEN STATED IF THIS SHOULD OCCUR, IT WOULD THEN BE A MATTER FOR NEGOTIATION. MR. EISENBERG WAS THEN ASKED IF HE WAS EXPECTING TO PREPARE TWENTY (20) PUBLICATIONS ON SPECTRUM ANALYZERS RATHER THAN TWENTY (20) ITEMS WHICH HAVE THE SAME COMPLEXITY AS A SPECTRUM ANALYZER. MR. EISENBERG STATED, HE EXPECTED TWENTY (20) SPECTRUM ANALYZERS ONLY. MR. EISENBERG WAS THEN ASKED IF HE UNDERSTOOD THE CLARIFYING NOTE ON PAGE 5 OF THE IFB, WHICH DEFINES COMPLEXITY WITH AN EXAMPLE. MR. EISENBERG REPLIED,"YES.' TO FURTHER CLARIFY MR. EISENBERG'S STATEMENT OF HIS UNDERSTANDING OF THE NOTE ON PAGE 5, HE WAS THEN ASKED IF AN AIRCRAFT TEST STAND WOULD APPEAR IN CATEGORY 40 ON A TASK ORDER WHAT WOULD BE HIS REACTION? HE REITERATED THAT IN THE CATEGORY 40 OF THE IFB HE WAS EXPECTING TO SEE ONLY 20 SPECTRUM ANALYZERS.

"E. MR. EISENBERG WAS THEN REQUESTED TO PRESENT HIS TOTAL MANHOUR ESTIMATES FOR ITEMS 11 AND 13 BY LABOR CATEGORY. MR. EISENBERG DID NOT COMPLY, BUT WAVED HIS HAND AND REQUESTED MR. VEIT TO ANSWER. MR. VEIT'S REPLY WAS THAT TO ENGINEER, WRITE AND EVALUATE A PROCEDURE FOR AN AMMETER WOULD REQUIRE TWENTY (20) HOURS, AND TO ENGINEER, WRITE AND EVALUATE A PROCEDURE FOR A SPECTRUM ANALYZER EIGHTY (80) TO THREE HUNDRED (300) HOURS.

"F. MR. VEIT WAS THEN ASKED IF THE GENERAL PROCEDURES REFERENCED BY MR. EISENBERG COULD BE UTILIZED TO PREPARE A PROCEDURE FOR DIGITAL VOLTMETERS (1 OF THE 40 CATEGORIES). MR. VEIT'S REPLY WAS, THIS WOULD BE IMPOSSIBLE BECAUSE OF THE VARIOUS MODELS OF THE INSTRUMENT AND THAT A SPECIFIC PROCEDURE MUST BE PREPARED FOR EACH.

"K. MR. EISENBERG WAS THEN REQUESTED TO EXPLAIN THE FLOW CHART SUBMITTED BY HIS COMPANY WITH THE IFB. MR. EISENBERG REQUESTED THAT MR. VEIT EXPLAIN THE FLOW CHART (SEE INCLOSURE 2). MR. VEIT STATED THAT FORTY (40) BASIC PROCEDURES WOULD BE PREPARED AND EVALUATED AT A COST OF $70,000.00 PRIOR TO PERFORMING ANY ACTION BASED UPON THE RECEIPT OF A TASK ORDER FROM THE GOVERNMENT. UPON COMPLETION OF THE FORTY (40) BASIC PROCEDURES, THEY WOULD THEN PROCEED TO PREPARE SPECIFIC PROCEDURES LISTED ON THE TASK ORDER.

"NOTE: THESE BASIC PROCEDURES ARE NOT A CONTRACT REQUIREMENT AND WOULD IMPEDE SUBSEQUENT DELIVERIES OF ITEMS LISTED ON TASK ORDERS.

"1. LT. BOLAND CHALLENGED PDI CAPABILITY TO MEET THE REQUIREMENTS OF THE IFB WITH RESPECT TO PERSONNEL CAPABILITIES AND PERSONNEL REQUIRED.

"4. CONCLUSIONS AND ACTION TAKEN:

"A. THE FRANKFORD ARSENAL TEAM MEMBERS AGREED TO THE FOLLOWING:

"/1) PDI DID NOT UNDERSTAND THE SCOPE OF WORK AS LISTED IN THE IFB.

"/2) PDI DID NOT UNDERSTAND THE NOTE ON PAGE 5 INDICATING DEGREES OF COMPLEXITY.

"/3) PDI'S PROPOSAL TO PREPARE FORTY (40) BASIC PROCEDURES FOR FORTY (40) ITEMS WOULD PRECLUDE FURTHER ENGINEERING EFFORT WAS TOTALLY ERRONEOUS.

"/4) PDI DID NOT PROGRAM PERSONNEL TO PERFORM DYNAMIC EVALUATION OF EACH SPECIFIC PUBLICATION, BUT BELIEVED THE GOVERNMENT WOULD EVALUATE THE PUBLICATIONS.

"/5) PDI DID NOT PROGRAM SUFFICIENT PERSONNEL TO ACCOMPLISH THE TASK LISTED IN THE IFB.

"/6) PDI MANHOUR ESTIMATES WERE TOTALLY ERRONEOUS.

"/7) PDI WOULD HAVE TO SUB-CONTRACT FOR ENGINEER TALENT SINCE NO ENGINEERING CAPABILITY WAS EVIDENT DURING THE PRE-AWARD SURVEY.

"5. RECOMMENDATIONS:

"NO RECOMMENDATIONS COULD BE MADE AT THIS TIME SINCE FURTHER DISCUSSIONS WERE SCHEDULED TO BE HELD WITH THE CONTRACTOR AT A LATER DATE.'

IN HIS REPORT TO THIS OFFICE THE CONTRACTING OFFICER HAS SUMMARIZED THE OCCURRENCES SUBSEQUENT TO THE FACILITY SURVEY CONDUCTED ON NOVEMBER 10 WHICH CULMINATED IN HIS FINAL DETERMINATION THAT PDI WAS NOT A RESPONSIBLE BIDDER. HE STATES:

"10. ON 16 NOVEMBER 1966, A FURTHER CONFERENCE WAS HELD AT THE PDI FACILITY WITH PERSONNEL OF DCASR, FRANKFORD ARSENAL AND PDI. AT THIS MEETING THE DEFICIENCIES RELATING TO RESPONSIBILITY WERE EXPLAINED BY PDI SUFFICIENTLY SATISFACTORILY TO INDICATE THAT IT WAS RESPONSIBLE, EXCEPT WITH RESPECT TO PDI'S TECHNICAL CAPABILITIES TO MEET THE REQUIREMENT OF THE IFB THAT 1355 BULLETINS WOULD BE REQUIRED AND WHICH WOULD RELATE TO MANY (MORE THAN 40) TYPES OF INSTRUMENTS. THIS IS SUMMARIZED IN THE TRIP REPORT DATED 8 DECEMBER 1966. (INCL NO. 17). "11. ON 18 NOVEMBER 1966, A CONFERENCE WAS HELD AT FRANKFORD ARSENAL ATTENDED BY REPRESENTATIVES OF DCASR AND FRANKFORD ARSENAL FOR PURPOSE OF EVALUATING PDI AS A RESPONSIBLE BIDDER. IT WAS THE UNANIMOUS RECOMMENDATION THAT ADDITIONAL EFFORTS SHOULD BE MADE BY THE CONTRACTING OFFICER TO AGAIN ENDEAVOR TO OBTAIN INFORMATION FROM PDI AS TO THE WORK IT WOULD DO IF AWARDED THE CONTRACT, AND HOW AND WHAT PERSONNEL MIGHT BE USED FOR THIS WORK. IN ADDITION, OTHER BIDDERS WOULD BE REQUESTED TO DEFINE THE SCOPE OF WORK AS THEY UNDERSTOOD IT FROM THE IFB. (INCL NO. 18).

"12. BY LETTER DATED 23 NOVEMBER 1966, THE CONTRACTING OFFICER ADVISED PDI OF HIS DEEP CONCERN WITH PDI'S ABILITY TO MEET THE TECHNICAL REQUIREMENTS OF THE WORK TO BE DONE. THE LETTER REITERATED THE PROPER DEFINITION OF THE 40 CATEGORIES; AND THE SPECIFICATION REQUIREMENTS IN THE PURCHASE DESCRIPTION RELATING TO MINIMUM USE SPECIFICATIONS, SUBMISSION OF DATA FOR ANY REQUIRED ADDITIONAL EQUIPMENT, THE DYNAMIC EVALUATION BY THE CONTRACTOR, AND REQUIREMENTS PERTAINING TO COPYRIGHT. IN CONCLUSION, THE LETTER URGED PDI TO FURNISH INFORMATION WHICH WOULD RESPOND TO THESE QUESTIONS (INCL NO. 19). IN REPLY, BY LETTER DATED 28 NOVEMBER 1966, PDI REPEATED ITS EXPERIENCES AND THE ACADEMIC BACKGROUND OF ITS PERSONNEL IN THE FIELD OF TECHNICAL PUBLICATIONS; THAT MR. I. EISENBERG, PRESIDENT OF PDI HAD EXECUTED THE "CERTIFICATE OF ELIGIBILITY AND UNDERSTANDING OF THE DRAWINGS AND SPECIFICATIONS, ETC.' IN THE IFB WHICH SHOULD BE SUFFICIENT TO ESTABLISH RESPONSIBILITY; AND, THAT THE INFORMATION REQUESTED BY THE CONTRACTING OFFICER IN HIS LETTER HAD BEEN FURNISHED PREVIOUSLY. (INCL NO. 20). THIS REPLY HAD BEEN HAND CARRIED TO FRANKFORD ARSENAL ON 1 DECEMBER 1966, AS INDICATED BY VISITOR'S REGISTER. (INCL NO. 21).'

ON DECEMBER 20 THE DIRECTOR, METROLOGY AND CALIBRATION CENTER, REVIEWED THE CRITICALITY OF THIS PROCUREMENT AND REPORTED TO THE PROCURING ACTIVITY THAT MANY OF THE REQUIREMENTS UNDER THIS PROCUREMENT WERE IDENTIFIED AS 02 PRIORITY, SOUTHEAST ASIA ITEMS. WE ARE INFORMED THAT THIS PRIORITY HAD BEEN ESTABLISHED BEFORE ISSUANCE OF THE SUBJECT IFB AND WAS IN NO WAY INFLUENCED BY CONSIDERATION OF YOUR BID. ON DECEMBER 21, THE CONTRACTING OFFICER REVIEWED ALL AVAILABLE DATA AND DETERMINED THAT PDI HAD NOT ESTABLISHED ITSELF AS A RESPONSIBLE BIDDER AND CERTIFIED IN WRITING THAT AWARD MUST BE MADE WITHOUT DELAY AND WOULD NOT PERMIT THE REFERRAL OF THE MATTER TO SBA.

IT IS YOUR POSITION THAT THERE IS NO BASIS FOR THE CONTRACTING OFFICER'S DETERMINATION THAT PDI IS NONRESPONSIBLE FOR FAILING TO UNDERSTAND THE SCOPE OF THIS PROCUREMENT, SINCE YOUR QUALIFICATIONS AND EXPERIENCES IN THIS FIELD WERE DEMONSTRATED TO THE CONTRACTING OFFICER AND YOUR BID SPECIFICALLY CERTIFIED THAT THE ENGINEERING REQUIREMENTS OF THE INVITATION WERE UNDERSTOOD AND COULD BE COMPLIED WITH. IT IS YOUR FURTHER CONTENTION THAT THE DETERMINATION OF NONRESPONSIBILITY RESULTED PRINCIPALLY FROM DELIBERATE ATTEMPTS TO DISCREDIT PDI IN THAT TELEPHONE INQUIRIES FOR CLARIFICATION OF THE ARSENAL'S REQUESTS FOR ADDITIONAL DOCUMENTATION BROUGHT RESPONSES DELIBERATELY INTENDED TO PRODUCE RESULTS WHICH WOULD BE DETRIMENTAL TO YOUR CAUSE. IN ADDITION YOU HAVE ALLEGED AND CITED DETAILED EXPERIENCES INVOLVING THREE PROCUREMENTS OVER THE PERIOD 1964- 1966 DURING WHICH PDI ENCOUNTERED ANTAGONISM AND HARRASSMENT BY CERTAIN PROCUREMENT OFFICIALS WHO ARE ALSO INVOLVED IN THE PRESENT PROCUREMENT.

ASPR 1-902 TREATS THE QUESTION OF CONTRACTOR RESPONSIBILITY AS FOLLOWS:

"1-902 GENERAL POLICY. PURCHASES SHALL BE MADE FROM, AND CONTRACTS SHALL BE AWARDED TO, RESPONSIBLE PROSPECTIVE CONTRACTORS ONLY. * * * 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.

ASPR APPENDIX K PRESCRIBES THE PROCEDURES TO BE FOLLOWED IN PRE AWARD SURVEYS OF PROSPECTIVE CONTRACTORS, AND PROVIDES IN SECTION 303.1 (B) (2) AS FOLLOWS:

"/B) (2) LACK OF UNDERSTANDING OR MISINTERPRETATION OF THE SOLICITATION OFTEN RESULTS IN DELINQUENT CONTRACTS AND LEADS TO DEFAULT ACTIONS. THEREFORE, THE SOLICITATION SHALL BE DISCUSSED WITH THE PROSPECTIVE CONTRACTOR TO ASSURE THAT HE UNDERSTANDS ITS REQUIREMENTS, INCLUDING ITS TECHNICAL ASPECTS, SUCH AS DRAWINGS, SPECIFICATIONS, PROTOTYPE, TECHNICAL DATA, TESTING, AND PACKAGING. ANY MISINTERPRETATIONS OF THE REQUIREMENTS OF THE SOLICITATION WHICH COULD ADVERSELY AFFECT PERFORMANCE, OR REFUSAL BY THE PROSPECTIVE CONTRACTOR TO FURNISH REQUIRED DATA, SHOULD BE BROUGHT TO THE IMMEDIATE ATTENTION OF THE MONITOR BY THE TEAM COORDINATOR. THE MONITOR SHALL, IN TURN, PROMPTLY ADVISE THE PURCHASING OFFICE.'

THE DETERMINATION OF A CONTRACTOR'S QUALIFICATIONS IS PRIMARILY THE FUNCTION OF THE CONTRACTING AGENCY, INVOLVING THE EXERCISE OF A CONSIDERABLE RANGE OF DISCRETION, AND, IN THE ABSENCE OF BAD FAITH, OR LACK OF SUBSTANTIAL GROUNDS FOR THE ADMINISTRATIVE DETERMINATION, THERE IS NO BASIS FOR LEGAL OBJECTION. SEE 37 COMP. GEN. 430 AND 43 COMP. GEN. 298.

WE HAVE THOROUGHLY REVIEWED THE VOLUMINOUS RECORD IN THIS CASE, TOGETHER WITH ALL THE STATEMENTS AND INFORMATION SUBMITTED BY YOU, AND WE CONCLUDE THAT THE RECORD CONTAINS SUBSTANTIAL GROUNDS FOR THE DETERMINATION OF YOUR LACK OF RESPONSIBILITY. STATEMENTS OF YOUR REPRESENTATIVES TO THE SURVEY TEAM, AS RECOUNTED IN THEIR REPORTS AND NOT REBUTTED BY YOUR REPRESENTATIONS TO OUR OFFICE, SUPPORT THE CONCLUSION THAT YOU DID NOT, AND APPARENTLY STILL DO NOT, FULLY COMPREHEND THE RIGHT OF THE GOVERNMENT UNDER THE LANGUAGE OF THE SCHEDULE TO CALL FOR THE PREPARATION OF A BULLETIN ON ANY TYPE OF ELECTRICAL OR ELECTRONIC TEST INSTRUMENT, WHETHER OR NOT NAMED IN THE SCHEDULE, AND TO DESIGNATE IN THE TASK ORDER THE PARTICULAR SCHEDULE CATEGORY UNDER WHICH IT WAS TO BE INVOICED AND PAID FOR.

IN VIEW OF THE DISCLOSURE OF YOUR MISUNDERSTANDING, OR DIFFERENT INTERPRETATION, OF THE TERMS OF THE PROPOSED CONTRACT, IT IS AT LEAST QUESTIONABLE WHETHER AWARD TO YOU WOULD HAVE BEEN PROPER IN ANY EVENT. SEE WPC ENTERPRISES, INC. V. UNITED STATES, 163 CT.CL. 1.

IN VIEW OF THESE CONCLUSIONS, CONSIDERATION OF YOUR FURTHER ALLEGATIONS CONCERNING THE IMPROPRIETIES RELATED TO PRIOR PROCUREMENTS, ALL OF WHICH ARE DISPUTED BY THE DEPARTMENT, IS NOT REQUIRED.

IT IS ALSO YOUR POSITION THAT THE DETERMINATION OF URGENCY OF THIS PROCUREMENT WAS A DELIBERATE MANEUVER TO AVOID THE CERTIFICATION OF YOUR COMPETENCY BY THE SBA SINCE THE DESIGNATION WAS SUDDENLY IMPOSED AT A LATE DATE. YOU FURTHER ALLEGE THAT IF AN URGENT NEED EXISTS FOR SOME ITEMS UNDER THIS CONTRACT SUCH NEED AROSE FROM AN UNWARRANTED DELAY OF THREE MONTHS FROM THE DATE OF THE INVITATION'S ISSUANCE TO THE DATE OF CONTRACT AWARD. FINALLY, YOU CONTEND THAT THE DESIGNATION OF URGENCY IS A USELESS EXERCISE SINCE SUFFICIENT GOVERNMENT FACILITIES FOR DYNAMICALLY EVALUATING THE BULLETINS DO NOT EXIST AND FROM YOUR EXPERIENCE A DELAY OF SIX MONTHS TO ONE YEAR IS INEVITABLE.

ASPR 1-705.4 PROVIDES THAT WHEN A BID OR PROPOSAL OF A SMALL BUSINESS CONCERN IS TO BE REJECTED SOLELY BECAUSE THE CONTRACTING OFFICER HAS DETERMINED THAT THE CONCERN IS NONRESPONSIBLE AS TO CAPACITY OR CREDIT, THE MATTER SHALL BE REFERRED TO SBA AND AWARD SHALL NOT BE MADE UNTIL SBA RENDERS ITS DECISION OR UNTIL FIFTEEN WORKING DAYS HAVE ELAPSED, WHICHEVER IS EARLIER. HOWEVER, ASPR 1 705.4 (C) (IV) PROVIDES THAT A REFERRAL NEED NOT BE MADE TO SBA IF THE CONTRACTING OFFICER CERTIFIES IN WRITING THAT THE AWARD MUST BE MADE WITHOUT DELAY, INCLUDES SUCH CERTIFICATE AND SUPPORTING DOCUMENTATION IN THE CONTRACT FILE, AND PROMPTLY FURNISHES A COPY TO THE SBA REPRESENTATIVE.

AS INDICATED ABOVE, IT APPEARS THAT THE URGENCY OF THE PROCUREMENT HAD BEEN ESTABLISHED BEFORE ISSUANCE OF THE IFB. IT WAS REVIEWED AND CONFIRMED BY THE DIRECTOR, METROLOGY AND CALIBRATION CENTER, UNDER DATE OF DECEMBER 20. THE REQUIRED CERTIFICATION WAS GIVEN TO THE APPROPRIATE REPRESENTATIVE OF SBA ON DECEMBER 22 AND AWARD OF THE CONTRACT TO RCA SERVICE COMPANY WAS RECOMMENDED BY THE BOARD OF AWARDS ON DECEMBER 28.

FROM OUR REVIEW OF THE RECORD WE ARE OF THE VIEW THAT THE CONTRACTING OFFICER ACTED WITH REASONABLE DILIGENCE IN CONDUCTING THE NECESSARY INQUIRIES PREREQUISITE TO AWARD. THE DELAY OF TWO MONTHS, FROM THE TIME BIDS WERE OPENED UNTIL THE DATE OF AWARD, RESULTED PRINCIPALLY FROM HIS EFFORTS TO ESTABLISH YOUR FIRM'S RESPONSIBILITY. THE FIRST PRE-AWARD SURVEY WAS CONDUCTED ONLY TEN DAYS AFTER BID OPENING, AND THE FURTHER INVESTIGATION FOUND NECESSARY AS A RESULT OF THE DOUBTS CREATED BY THE FIRST SURVEY WAS INTENDED ONLY TO AFFORD YOU THE OPPORTUNITY TO REMOVE THE DOUBTS. THE RECORD SHOWS NO OTHER REASON WHY THE CONTRACTING OFFICER COULD NOT HAVE MADE HIS DETERMINATION OF NONRESPONSIBILITY AT AN EARLIER DATE, AND WHILE THIS MIGHT HAVE PROVIDED SUFFICIENT TIME FOR SBA TO PASS ON YOUR COMPETENCY, WE CANNOT SAY THAT HIS FAILURE TO REACH HIS DECISION BEFORE DECEMBER 21 WAS NOT JUSTIFIED OR REASONABLE, AND THE REGULATIONS IMPOSE NO TIME LIMITATION UPON HIM IN THAT RESPECT. 46 COMP. GEN. PP., B- 158776, JULY 20, 1966.

LASTLY, IN REGARD TO YOUR OBJECTION CONCERNING THE ALLEGED INSUFFICIENCY OF GOVERNMENT FACILITIES AVAILABLE FOR DYNAMIC EVALUATION OF THE CALIBRATION PROCEDURES WE ARE REQUIRED TO ACCEPT THE CONTRACTING OFFICER'S REPORT THAT UNDER THIS CONTRACT CONTROL HAS BEEN ESTABLISHED TO MAKE INSTRUMENTS AVAILABLE FOR DYNAMIC TESTING, AS REQUIRED.

IN THE CIRCUMSTANCES, WE FIND NO ADEQUATE BASIS FOR OBJECTION TO THE ACTION TAKEN BY THE CONTRACTING OFFICER IN REJECTING YOUR LOW BID AND IN MAKING AWARD TO THE NEXT LOW RESPONSIVE, RESPONSIBLE OFFEROR. 38 COMP. GEN. 248. ACCORDINGLY, YOUR PROTEST MUST BE DENIED.

GAO Contacts

Office of Public Affairs