B-161955, SEP. 28, 1967

B-161955: Sep 28, 1967

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LOW BIDDER WHO WAS DETERMINED TO LACK FINANCIAL STRENGTH AND PRODUCTIVE CAPACITY BASED ON INFORMATION SECURED BY THE PURCHASING OFFICE AND ON A PREAWARD SURVEY MUST HAVE ADMINISTRATIVE DETERMINATION OF NONRESPONSIBILITY UPHELD IN ABSENCE OF ANY SHOWING OF BAD FAITH OR LACK OF REASONABLE BASIS FOR DETERMINATION. AS TO QUESTION OF DELAY IN MAKING AWARD THE CHRONOLOGY OF THE SET ASIDE INDICATES THAT PROCUREMENT WAS HANDLED WITH DISPATCH. DETERMINATION TO MAKE AWARD WITHOU REFERRAL TO SBA WAS PROPER. TO OMAR CORPORATION: REFERENCE IS MADE TO YOUR LETTER OF JULY 12. THE ABOVE IFB WAS ISSUED MARCH 24. BIDS WERE OPENED ON APRIL 14. THE NON-SET-ASIDE PORTION WAS AWARDED ON JUNE 2. A DRAWING WAS CONDUCTED IN ACCORDANCE WITH THE LABOR SURPLUS AREA SET-ASIDE PROVISIONS OF THE IFB.

B-161955, SEP. 28, 1967

BIDDERS - RESPONSIBILITY - ADMINISTRATIVE DETERMINATION DECISION TO OMAR CORPORATION CONCERNING PROPRIETY OF REJECTION OF PROPOSAL FOR FURNISHING TENT LINERS UNDER LABOR SURPLUS SET ASIDE PROCUREMENT ISSUED BY DEFENSE PERSONNEL SUPPORT CENTER, DSA. LOW BIDDER WHO WAS DETERMINED TO LACK FINANCIAL STRENGTH AND PRODUCTIVE CAPACITY BASED ON INFORMATION SECURED BY THE PURCHASING OFFICE AND ON A PREAWARD SURVEY MUST HAVE ADMINISTRATIVE DETERMINATION OF NONRESPONSIBILITY UPHELD IN ABSENCE OF ANY SHOWING OF BAD FAITH OR LACK OF REASONABLE BASIS FOR DETERMINATION. AS TO QUESTION OF DELAY IN MAKING AWARD THE CHRONOLOGY OF THE SET ASIDE INDICATES THAT PROCUREMENT WAS HANDLED WITH DISPATCH. IN VIEW OF EXISTING BACK ORDERS AND NEED FOR ITEM DESTINED OR SOUTHEAST ASIA, DETERMINATION TO MAKE AWARD WITHOU REFERRAL TO SBA WAS PROPER.

TO OMAR CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF JULY 12, 1967, PROTESTING REJECTION, FOR NONRESPONSIBILITY, OR YOUR PROPOSAL FOR FURNISHING TENT LINERS UNDER THE SET-ASIDE PORTION OF INVITATION FOR BIDS (IFB) NO. DSA-100-67-B-1807, ISSUED BY THE DEFENSE SUPPLY AGENCY (DSA), DEFENSE PERSONNEL SUPPORT CENTER (DPSC), PHILADELPHIA, PENNSYLVANIA.

THE ABOVE IFB WAS ISSUED MARCH 24, 1967, AND CALLED FOR 16,981 TENT LINERS, WITH AN ADDITIONAL 16,979 UNITS TO BE AWARDED AS A LABOR SURPLUS AREA SET-ASIDE. BIDS WERE OPENED ON APRIL 14, 1967, WITH 26 RESPONSIVE BIDS BEING RECEIVED. THE NON-SET-ASIDE PORTION WAS AWARDED ON JUNE 2, 1967, AS FOLLOWS: "ITEM 1 AMERICAN TENT COMPANY 923 EACH $221.07

ITEM 2 AMERICAN TENT COMPANY 1,445 EACH $221.07

ITEM 3 MANTEO MANUFACTURING CO. 7,150 EACH $245.65

ITEM 4 MANTEO MANUFACTURING CO. 7,463 EACH $245.34" ON JUNE 8, 1967, A DRAWING WAS CONDUCTED IN ACCORDANCE WITH THE LABOR SURPLUS AREA SET-ASIDE PROVISIONS OF THE IFB, AND AS A RESULT OF THIS DRAWING MR. WILLIAM LAHAIT OF OMAR WAS CONTACTED BY TELEPHONE ON JUNE 9, 1967, AND A QUOTATION FOR 922 UNITS OF ITEM 1 AND 7,462 UNITS OF ITEM 4 WAS REQUESTED. MR. WILLIAM SANDERS OF INTERNATIONAL TEXTILE PRODUCTS, INC., WAS ALSO CONTACTED AND ASKED IF HE WISHED TO QUOTE ON 1,445 UNITS OF ITEM 2 AND 7,150 UNITS OF ITEM 3. ON JUNE 12 MR. SANDERS ADVISED BY TELEPHONE THAT HE WOULD NOT SUBMIT A QUOTATION ON ITEM 2 AND MR. LAHAIT WAS IMMEDIATELY CONTACTED FOR A POSSIBLE PROPOSAL ON THE 1,445 UNITS OF ITEM 2. BY TELEGRAM OF JUNE 12 OMAR SUBMITTED THE FOLLOWING QUOTATION: ITEM 1 - 922 EACH $220.51733 ITEM 2 - 1,445 EACH 220.51733 ITEM 4 - 3,232 EACH 214.57223 AND

4,230 EACH 250.02665 DELIVERIES WERE REQUIRED TO BE MADE TO DEFENSE DEPOTS AT MECHANICSBURG, PENNSYLVANIA (ITEM 1), AND OGDEN, UTAH (ITEMS 2, 3 AND 4), WITH INITIAL QUANTITIES OF 110, 858 AND 894 UNITS OF ITEMS 1, 2 AND 4, RESPECTIVELY, TO BE DELIVERED WITHIN 135 DAYS AFTER DATE OF AWARD, AND ADDITIONAL STATED INCREMENTS TO BE DELIVERED WITHIN EACH 60 DAY PERIOD THEREAFTER, FINAL DELIVERY TO BE COMPLETED WITHIN 435 DAYS AFTER DATE OF AWARD.

ON JUNE 12, 1967, A REQUEST FOR A PRE-AWARD SURVEY ON OMAR WAS FORWARDED TO THE DEFENSE CONTRACT ADMINISTRATION SERVICES OFFICE (DCASO), MIAMI, FLORIDA. FACTORS TO BE REPORTED ON WERE TECHNICAL CAPABILITY, PRODUCTION CAPABILITY, PLANT FACILITIES AND EQUIPMENT, PURCHASING AND SUBCONTRACTING, QUALITY ASSURANCE CAPABILITY, LABOR RESOURCE, PERFORMANCE RECORD, ABILITY TO MEET REQUIRED SCHEDULE AND OTHER FACTORS DEEMED APPROPRIATE BY DCASO. IN RESPONSE TO REQUEST OF JUNE 13 FOR INFORMATION REGARDING FINANCIAL ARRANGEMENTS FOR PERFORMING THE PROPOSED CONTRACT, MR. LAHAIT REPORTED THAT ARRANGEMENTS WOULD BE MADE WITH EITHER BANK OF FOMENTO OR BANK OF POPOLAR, BOTH IN PUERTO RICO, AND THAT FIRM INFORMATION WOULD BE PROVIDED TO THE CONTRACTING OFFICER ON JUNE 14, ARRANGEMENTS WITH THESE BANKS, IF PURSUED, WERE APPARENTLY NEVER CONCLUDED, AND ON JUNE 19 MR. LAHAIT ADVISED THAT MR. WALTER MUNDY, PRESIDENT OF OMAR, WAS COMPLETING FINANCIAL ARRANGEMENTS AND THAT THIS INFORMATION WOULD BE FURNISHED AS SOON AS POSSIBLE. THE CONTRACTING OFFICER REPORTS THAT ON JUNE 26 MR. MUNDY FURNISHED INFORMATION BY TELEPHONE IDENTIFYING THE PRINCIPALS IN THE CORPORATION AS MR. FLOYD WHITE, PRESIDENT OF RICHLEE DYE AND FINISHING CO., DR. HARVEY WHITE, MR. WILLIAM LAHAIT AND HIMSELF, AND STATING THAT FINANCIAL ARRANGEMENTS HAD BEEN MADE WITH THE NEW JERSEY BANK, MARKET STREET BRANCH, PATERSON, NEW JERSEY, BY DEPOSIT OF $50,000 CASH IN OMAR'S ACCOUNT AND MAKING AN ADDITIONAL $150,000 LINE OF CREDIT AVAILABLE FOR PERFORMANCE OF THE CONTRACT. HOWEVER, MR. MUNDY HAS ORALLY ADVISED THIS OFFICE THAT HE DID NOT STATE $50,000 HAD BEEN DEPOSITED TO OMAR'S ACCOUNT, BUT THAT IT WOULD BE MADE AVAILABLE PROMPTLY UPON AWARD OF A CONTRACT. THIS IS IN LINE WITH A MEMORANDUM OF UNDERSTANDING AND AGREEMENT DATED JUNE 25 AND SIGNED BY MR. FLOYD WHITE AND BY MESSRS. LAHAIT AND MUNDY WHEREBY MR. WHITE AGREES, INTER ALIA, THAT HE WILL: "A. WITHIN 48 HRS. PROVIDE $50,000 CASH TO OMAR CORPORATION TO BE DEPOSITED IN A SPECIAL ACCOUNT. "B. WITHIN 10 WORKING DAYS OBTAIN FROM A BANK OR OTHER FINANCIAL ORGANIZATION, A LINE OF CREDIT UP TO $150,000 TO BE AVAILABLE AS REQUIRED PER THE CASH FLOW REQUIREMENTS OF OMAR CORPORATION.' ON JUNE 26 MR. GEORGE DUNCAN, PROCUREMENT AGENT, AND MR. JOHN BUCKLEY, OFFICE OF BID AND PRICE ANALYSIS, DPSC, CONTACTED THE NEW JERSEY BANK AND TALKED TO A MR. SPAES, CREDIT MANAGER, WHO ADVISED THAT OMAR HAD NO ACCOUNT AT THE BANK AND THAT RICHLEE DYE AND FINISHING CO. HAD AN ACCOUNT IN THE LOW FIVE FIGURES, BUT THAT NO ARRANGEMENTS HAD BEEN MADE BETWEEN THE BANK AND ANY OF THE PRINCIPALS OF OMAR OR THE RICHLEE DYE AND FINISHING CO. REGARDING FINANCING A PROPOSED CONTRACT FOR TENT LINERS. MR. SPAES STATED THAT HE HAD CONTACTED NUMEROUS PERSONS IN THE BANK, INCLUDING A VICE PRESIDENT, AND THAT NONE WERE AWARE OF ANY SUCH ARRANGEMENTS.

PREVIOUSLY ON JUNE 22 ORAL ADVICE WAS RECEIVED FROM DCAS REGION, ATLANTA, THAT THE PRE-AWARD SURVEY HAD RESULTED IN A RECOMMENDATION OF "NO-AWARD," DUE TO LACK OF TECHNICAL, PRODUCTION, AND FINANCIAL CAPABILITIES, INABILITY TO MEET THE REQUIRED SCHEDULE AND OTHER FACTORS. A RESUME OF THESE REASONS WAS GIVEN ORALLY AT THE TIME AND A FORMAL WRITTEN SURVEY WAS RECEIVED ON JUNE 28. ON JUNE 29 DCASO, MIAMI, ADVISED BY TELEPHONE THAT ADDITIONAL INFORMATION HAD BEEN FURNISHED BY OMAR WHICH WOULD MAKE ITS TECHNICAL CAPABILITY SATISFACTORY BUT WOULD NOT CHANGE THE RECOMMENDATION OF "NO AWARD.' THIS INFORMATION WAS CONFIRMED BY LETTER OF JUNE 30 FROM DCAS DISTRICT, ORLANDO. UPON RECEIPT OF THE NEGATIVE ORAL REPORT OF SURVEY THE DIRECTORATE OF SUPPLY OPERATIONS, DPSC, WAS REQUESTED TO FURNISH SUPPLY STATUS INFORMATION FOR THE TENT LINERS. IT DEVELOPED THAT THE ITEM WAS IN A CRITICAL SUPPLY POSITION AND THAT BACK ORDERS TOTALED 27,494, OF WHICH 17,698 WERE REQUIRED FOR SOUTHEAST ASIA. IT WAS THEREFORE CONSIDERED TO BE IN THE INTEREST OF THE GOVERNMENT TO CONTACT THE FIRMS DRAWN NEXT IN ORDER OF PRIORITY ON THE SET-ASIDE TO DETERMINE WHETHER THEY WERE INTERESTED IN QUOTING ON ITEMS 1, 2 AND 4. ACCORDINGLY, QUOTATIONS WERE SOLICITED AND RECEIVED FROM AMERICAN TENT COMPANY ON ITEMS 1 AND 2, AND FROM INTERNATIONAL TEXTILE PRODUCTS, INC., ON ITEMS 3 AND 4.

ON JUNE 29 THE CONTRACTING OFFICER MADE A DETERMINATION PURSUANT TO SECTION 1-904 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) THAT OMAR WAS NONRESPONSIBLE DUE TO LACK OF CAPACITY AND CREDIT AND ITS OFFER WAS FOR REJECTION IN ACCORDANCE WITH ASPR 2-404.2 (G). HE FURTHER DETERMINED, AND ISSUED THE REQUIRED CERTIFICATE TO THAT EFFECT, THAT IN VIEW OF THE CRITICAL SUPPLY STATUS AWARDS MUST BE MADE WITHOUT DELAY AND THAT REFERRAL TO SMALL BUSINESS ADMINISTRATION(SBA) FOR POSSIBLE ISSUANCE OF A CERTIFICATE OF COMPETENCY (COC) WOULD NOT BE MADE (ASPR 1-705.4 (C) (IV) ). AWARDS OF THE SET-ASIDE WERE THEREFORE MADE ON JUNE 30 TO AMERICAN TENT FOR ITEMS 1 AND 2 AND TO INTERNATIONAL TEXTILE FOR ITEMS 3 AND 4. ON THE SAME DAY THE CONTRACTING OFFICER NOTIFIED MESSRS. LAHAIT AND MUNDY BY TELEPHONE THAT, DUE TO THE URGENCY OF THE REQUIREMENT, AWARDS COULD NOT BE FURTHER DELAYED AND THAT OMAR HAD BEEN DETERMINED TO BE NONRESPONSIBLE FOR LACK OF CAPACITY AND CREDIT, BASED ON INFORMATION DEVELOPED BY THE PRE-AWARD SURVEY, DETAILS OF WHICH WERE ALSO FURNISHED TO MESSRS. LAHAIT AND MUNDY.

YOUR LETTER OF PROTEST STATES THAT IT IS YOUR UNDERSTANDING NO ONE ACTUALLY TALKED WITH THE BANK OFFICIAL DESIGNATED BY YOU AS A FINANCIAL REFERENCE; THAT YOUR ATTEMPTS TO CONTACT LT. COMDR. MITTS, CONTRACTING OFFICER, BY TELEPHONE ON JUNE 28, 29 AND 30, TO FURNISH ANY NECESSARY ADDITIONAL EVIDENCE OF RESPONSIBILITY, WERE FRUITLESS UNTIL APPROXIMATELY 4:00 P.M. ON JUNE 30; AND THAT YOU SHOULD HAVE BEEN GIVEN AN OPPORTUNITY TO APPEAL OR CORRECT ANY OPINIONS OF ALLEGED INADEQUACIES IN YOUR FINANCIAL AND TECHNICAL RESOURCES. YOU MAINTAIN THAT OMAR HAS THE NECESSARY QUALIFICATIONS AND THAT IT IS INCONCEIVABLE THAT AN EMERGENCY COULD BE SUCH AS TO ALLOW TWO AND ONE HALF MONTHS DELAY IN AWARD FROM DATE OF BID OPENING, AND NOT ALLOW ANY TIME FOR CLARIFICATION OR APPEAL OF ALLEGED DEFICIENCIES THROUGH THE SMALL BUSINESS ADMINISTRATION COC PROCEDURES. ALSO, MR. MUNDY STRONGLY QUESTIONS THE STATEMENT IN THE PRE- AWARD SURVEY THAT NO PRODUCTION PLAN WAS AVAILABLE TO DETERMINE HOW THE SCHEDULE OF DELIVERIES COULD BE MET, AND STATES THAT HE WILL PRESENT EXPERT TESTIMONY THAT THE PLAN SUBMITTED TO THE PRE-AWARD SURVEY TEAM CLEARLY ESTABLISHED OMAR'S ABILITY TO MEET THE PERFORMANCE REQUIREMENTS OF THE CONTRACT. MR. MUNDY HAS ALSO QUESTIONED THE AWARD TO AMERICAN TENT OF ITEMS 1 AND 2 ON THE SET-ASIDE, FOR THE ALLEGED REASON THAT ELIGIBLE BIDDERS IN PRIORITY GROUPS 2, 3 AND 4 WERE NOT SOLICITED, WHEREAS AMERICAN TENT IS IN GROUP 5. WITH REFERENCE TO THIS LAST CONTENTION, DSA HAS ADVISED US THAT THERE WERE NO BIDDERS IN GROUPS 2, 3 OR 4 WHO BID WITHIN 120 PERCENT OF THE HIGH AWARD PRICE OF ITEMS 1 AND 2 ON THE NON-SET- ASIDE. FURTHEMORE, UNDER THE TERMS OF THE IFB AMERICAN TENT WAS NOT SUBJECT TO A DRAWING, BUT WAS ENTITLED TO FIRST PRIORITY IN GROUP 5 ON THE SET-ASIDE OF ITEMS 1 AND 2 AS THE CONCERN WHICH RECEIVED THE AWARD OF ITEMS 1 AND 2 ON THE NON-SET-ASIDE.

ASPR 1-902 PROVIDES THAT CONTRACTS SHALL BE AWARDED TO RESPONSIBLE PROSPECTIVE CONTRACTORS NLY; THAT A PROSPECTIVE CONTRACTOR MUST DEMONSTRATE AFFIRMATIVELY HIS RESPONSIBILITY; AND THAT DOUBT AS TO PRODUCTIVE CAPACITY OR FINANCIAL STRENGTH WHICH CANNOT BE RESOLVED AFFIRMATIVELY SHALL REQUIRE A DETERMINATION OF NONRESPONSIBILITY BY THE CONTRACTING OFFICER, WHICH NECESSITATES REJECTION OF THE BID (ASPR 2-404.2 (G) ). NORMALLY, IF A BID OR PROPOSAL OF A SMALL BUSINESS CONCERN IS TO BE REJECTED SOLELY BECAUSE THE CONTRACTING OFFICER HAS DETERMINED THE CONCERN TO BE NONRESPONSIBLE AS TO CAPACITY OR CREDIT, THE MATTER MUST BE REFERRED TO SBA FOR POSSIBLE ISSUANCE OF A COC. HOWEVER, THIS REFERRAL NEED NOT BE MADE 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 (ASPR 1 705.4 (C) (IV) ).

WITH REFERENCE TO YOUR UNDERSTANDING THAT NO ONE CONTACTED THE OFFICIAL THAT YOU DESIGNATED AT THE NEW JERSEY BANK, MR. MUNDY HAS STATED THAT THIS WAS A MR. WENZEL, A VICE-PRESIDENT, AND THAT MR. WENZEL HAS ADVISED HIM THAT WHEN THE GOVERNMENT REPRESENTATIVES ATTEMPTED TO CONTACT HIM HE WAS NOT AVAILABLE AND HIS SECRETARY REFERRED THEM TO MR. SPAES, THE CREDIT MANAGE, WHO MADE EVERY REASONABLE EFFORT BUT WAS UNABLE TO ASCERTAIN THAT CREDIT ARRANGEMENTS HAD BEEN MADE. THE GOVERNMENT DID, THEREFORE, ATTEMPT TO CONTACT THE DESIGNATED OFFICIAL, BUT WAS UNABLE TO REACH HIM OR TO VERIFY THE ESTABLISHMENT OF CREDIT. NOR ARE WE AWARE THAT ANY EVIDENCE HAS SINCE BEEN PRESENTED THAT THE NECESSARY CREDIT WOULD, IN FACT, HAVE BEEN AVAILABLE.

AN ADVERSE PICTURE WAS ALSO PRESENTED BY THE REPORT OF THE PREAWARD SURVEY, WHICH FAILED TO DEVELOP ANY DEFINITE EVIDENCE OF FINANCIAL CAPABILITY. IT APPEARS THAT ON JUNE 20 THE FINANCIAL ANALYST AND OTHER MEMBERS OF THE PRE-AWARD TEAM MET IN SAN JUAN WITH MR. MUNDY, WHO STATED THAT STOCK IN THE CORPORATION WOULD BE DIVIDED 25 PERCENT TO HIMSELF, 25 PERCENT TO MR. LAHAIT AND 50 PERCENT TO AN UNNAMED THIRD PARTY, AND THAT FINANCIAL PLANNING WAS AS FOLLOWS: $50,000 CASH TO BE MADE AVAILABLE BY THE THREE STOCKHOLDERS. $50,000 THROUGH THE BANCO CREDITO OF SAN JUAN, SECURED BY EQUIPMENT PURCHASED. $100,000 FROM OUTSIDE INVESTOR. MR. MUNDY ALSO STATED THAT HE WAS TRYING TO SECURE PUERTO RICAN INVESTORS, AS THERE WERE ECONOMIC ADVANTAGES TO USE OF LOCAL FUNDS, BUT THAT HE ALREADY HAD AN INVESTOR, OR INVESTORS, IN THE UNITED STATES READY, WILLING AND ABLE TO FURNISH $100,000 IN THE EVENT A CONTRACT WAS SECURED. HE STATED FURTHER THAT ONCE HE WAS ADVISED THAT OMAR WAS IN LINE FOR A CONTRACT ALL DETAILS OF NAMES AND DOLLARS WOULD BE RELEASED, BUT NOT BEFORE. SINCE IMPORTANT DETAILS WERE WITHHELD, THE FINANCIAL ANALYST CONCLUDED THAT FINANCIAL CAPABILITY WAS EXTREMELY DUBIOUS AND THAT, IN THE ABSENCE OF EVIDENCE OF FIRM COMMITMENTS, ANY OF THE UNNAMED INVESTORS COULD WITHDRAW, LEAVING THE GOVERNMENT IN THE UNDESIRABLE POSITION OF BEING TIED TO A CONTRACTOR WITHOUT ADEQUATE FINANCES.

WITH REFERENCE TO CAPACITY, IT APPEARS THAT OMAR CORPORATION WAS ORGANIZED FOR THE PURPOSE OF SECURING THIS CONTRACT AND THAT IT HAD NO PLANT OR EQUIPMENT, AND NO PERSONNEL OTHER THAN THE OFFICERS. OPTIONS WERE HELD ON PLANT FACILITIES, QUOTATIONS HAD BEEN SECURED ON THE NECESSARY MACHINE TOOLS AND MATERIALS, AND IT HAD BEEN DETERMINED THAT THERE WAS AN ADEQUATE LABOR RESOURCE IN PONCE, PUERTO RICO, WHERE THE WORK WAS TO BE PERFORMED. HOWEVER, UPON RECEIPT OF AN AWARD OMAR WOULD HAVE BEEN STARTING FROM SCRATCH AND, AS INDICATED IN YOUR PLANT ACTIVATION PLAN, IT WOULD HAVE REQUIRED APPROXIMATELY 60 DAYS TO PREPARE FOR PRODUCTION. YOUR PLAN CONTEMPLATED THAT, DURING THE FIRST 30 DAYS AFTER AWARD, 20 OPERATIONS WOULD BE UNDERTAKEN IN CONNECTION WITH THE ACTIVATION OF THE PLANT, INCLUDING INSTALLATION OF SOME EQUIPMENT AND TRAINING OF SUPERVISORY PERSONNEL, AND THAT ACTIVATION WOULD BE COMPLETED DURING THE SECOND 30 DAY PERIOD, WITH INSTALLATION OF THE REMAINING EQUIPMENT, COMPLETION OF PERSONNEL TRAINING, AND MANUFACTURE OF PRE-PRODUCTION UNITS. A MANUFACTURER WHO IS IN BUSINESS AND SET UP FOR PRODUCTION OF THE ITEMS IN QUESTION WOULD NOT BE FACED WITH THIS HANDICAP OF APPROXIMATELY 60 DAYS BEFORE GOING INTO PRODUCTION. IT IS UNDERSTANDABLE, THEREFORE, THAT THE PRE-AWARD SURVEY REPORT EXPRESSES THE CONCLUSION THAT THE DELIVERY SCHEDULE OF 135 DAYS FOR THE INITIAL QUANTITIES DOES NOT PROVIDE ENOUGH LEAD TIME TO ACTIVATE AN EMPTY BUILDING, PROVIDE TRAINING, PROCURE EQUIPMENT, ESTABLISH CONTROLS, AND MEET THE SCHEDULE OF THE RFP. WHILE THE FACT THAT YOU ARE NOT IN BUSINESS DOES NOT DISQUALIFY YOU, IT IS DEFINITELY A FACTOR FOR CONSIDERATION BY THE CONTRACTING OFFICER. WE DO NOT QUESTION THAT MR. MUNDY COULD PRESENT EXPERT OPINION THAT OMAR'S PRODUCTION PLAN WAS ADEQUATE, BUT WHERE SUCH A DIFFERENCE OF EXPERT OR TECHNICAL OPINION OCCURS BETWEEN A BIDDER AND THE CONTRACTING AGENCY, WE MUST ACCEPT THE POSITION OF THE AGENCY SO LONG AS THERE IS A REASONABLE BASIS, AS APPEARS IN THIS CASE, TO SUPPORT IT.

AS STATED ABOVE, THE CONTRACTING OFFICER IS CHARGED BY REGULATION WITH THE DUTY OF MAKING AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY BEFORE MAKING AN AWARD, AND ANY REASONABLE DOUBT AS TO PRODUCTIVE CAPACITY OR FINANCIAL STRENGTH REQUIRES A DETERMINATION OF NONRESPONSIBILITY. REACHING A CONCLUSION IS NECESSARILY A MATTER OF JUDGMENT AND MUST PROPERLY BE LEFT LARGELY TO THE ADMINISTRATIVE DISCRETION OF THE PROCURING AGENCY, WHICH IS IN THE BEST POSITION TO MAKE AN EVALUATION. WE HAVE THEREFORE CONSISTENTLY TAKEN THE POSITION THAT WE WILL NOT ATTEMPT TO SUBSTITUTE OUR JUDGMENT FOR THAT OF THE CONTRACTING OFFICIALS AND THAT IN THE ABSENCE OF ANY SHOWING OF BAD FAITH OR LACK OF A REASONABLE FACTUAL BASIS FOR THE DETERMINATION, WE WILL NOT QUESTION ITS VALIDITY. 43 COMP. GEN. 228; 39 ID. 705, 711; 38 ID. 248. THE DETERMINATION IN THIS CASE WAS BASED ON INFORMATION SECURED BY REPRESENTATIVES OF THE PURCHASING OFFICE AND ON A PRE-AWARD SURVEY CONDUCTED IN DEPTH BY DCAS, A BRANCH OF DSA WHICH IS CHARGED WITH THIS RESPONSIBILITY, AND THERE HAS BEEN NO SHOWING OF BAD FAITH ON THE PART OF ANY GOVERNMENT REPRESENTATIVES.

AS TO THE QUESTION RAISED CONCERNING THE ALLEGED DELAY OF TWO AND ONE- HALF MONTHS IN MAKING AWARD, INFORMATION FURNISHED BY DPSC INDICATES THAT THERE WAS NO UNDUE DELAY IN HANDLING THE MATTER. AS STATED HEREIN 26 RESPONSIVE BIDS WERE RECEIVED ON APRIL 14, ALL OF WHICH HAD TO BE EVALUATED. SINCE QUOTATIONS WERE ON BOTH F.O.B. ORIGIN AND F.O.B. DESTINATION BASES, IT WAS NECESSARY, AMONG OTHER THINGS, TO SECURE NUMEROUS FREIGHT RATES IN ORDER TO DETERMINE THE LOW BIDDERS. EVALUATION WAS COMPLETED BY MAY 2 AND A PRE-AWARD PLANT AND FINANCIAL SURVEY WAS REQUESTED ON MANTEO MANUFACTURING CO. THIS REPORT WAS RECEIVED MAY 20. FINANCIAL REPORT WAS ALSO REQUESTED ON AMERICAN TENT AND RECEIVED MAY 19. PREPARATION OF THE NECESSARY AWARD PAPERS WAS COMPLETED MAY 25, THEY WERE PROCESSED THROUGH CHANNELS IN ABOUT A WEEK, AND AWARD OF THE NON-SET-ASIDE WAS MADE JUNE 2. THE CHRONOLOGY OF THE SET-ASIDE PORTION OF THE AWARD IS STATED ABOVE AND INDICATES THAT IT WAS HANDLED WITH DISPATCH. IN THE CIRCUMSTANCES, THERE WAS NO ABNORMAL DELAY AND IN VIEW OF THE EXISTING BACK ORDERS FOR TENT LINERS, MANY OF WHICH WERE DESTINED FOR SOUTHEAST ASIA, THE DECISION TO MAKE THE AWARD WITHOUT REFERRAL TO SBA APPEARS TO HAVE BEEN FULLY JUSTIFIED.

FOR THE REASONS STATED WE FIND NO LEGAL BASIS FOR QUESTIONING THE ACTIONS TAKEN, AND YOUR PROTEST IS THEREFORE DENIED.