B-163263, MAR. 25, 1968

B-163263: Mar 25, 1968

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THAT SOLICITATION WAS FOR OFFERS ON 90. THE PROCUREMENT WAS NEGOTIATED PURSUANT TO SECTION 2304 (A) (9). WAS LOW. THE NEXT LOW OFFER FROM MAGIC MIX COMPANY WAS SUBMITTED BY TELEPHONE AND CONFIRMED BY LETTER. WHICH WAS PROVIDED. LATER YOU WERE ADVISED THAT YOUR COMPANY WOULD BE DELETED FROM THE DIRECTORY OF SANITARILY APPROVED FOOD ESTABLISHMENT FOR ARMED FORCES PROCUREMENT AT YOUR REQUEST. YOU WERE INFORMED THAT SANITARY APPROVAL WAS NO LONGER REQUIRED. LATER THE SAME DAY YOU WERE ADVISED THAT THIS INFORMATION WAS ERRONEOUS AND WAS BASED ON A MISINTERPRETATION OF THE PERTINENT REGULATIONS. IMMEDIATE ACTION WAS UNDERTAKEN TO ARRANGE ANOTHER INSPECTION OF YOUR FACILITIES WHICH WAS CONDUCTED ON JANUARY 3.

B-163263, MAR. 25, 1968

TO BAK-KIT COMPANY OF AMERICA:

WE REFER TO YOUR TELEGRAM DATED JANUARY 8, 1968, AND LETTER OF JANUARY 10, 1968, SETTING FORTH A NUMBER OF DIFFICULTIES EXPERIENCED WITH THE DEFENSE PERSONNEL SUPPORT CENTER, BROOKLYN, NEW YORK, AND PROTESTING IN PARTICULAR THE REFUSAL OF THE SUBSISTENCE REGIONAL HEADQUARTERS, DPSC, NEW YORK, TO AWARD YOUR COMPANY A CONTRACT UNDER ADDENDUM NO. 5 TO NOTICE OF INTENT TO PURCHASE NO. DSA 136-8-N-00042.

THAT SOLICITATION WAS FOR OFFERS ON 90,000 POUNDS OF SWEET DOUGH MIX AND 1,944 POUNDS OF DOUGHNUT MIX TO BE SUBMITTED NOT LATER THAN DECEMBER 27, 1967. THE PROCUREMENT WAS NEGOTIATED PURSUANT TO SECTION 2304 (A) (9), TITLE 10 OF THE U.S.C. WHICH EXCEPTS FROM THE REQUIREMENT FOR FORMAL ADVERTISING THE PROCUREMENT OF PERISHABLE OR NONPERISHABLE SUBSISTENCE SUPPLIES. YOUR OFFER, SUBMITTED BY LETTER RECEIVED ON DECEMBER 26, 1967, WAS LOW. THE NEXT LOW OFFER FROM MAGIC MIX COMPANY WAS SUBMITTED BY TELEPHONE AND CONFIRMED BY LETTER. ON DECEMBER 27, 1967, THE PROCUREMENT OFFICE, SUSPECTING A MISTAKE IN BID, REQUESTED CONFIRMATION OF YOUR PRICES FOR ITEMS 1 AND 2, WHICH WAS PROVIDED.

LATER YOU WERE ADVISED THAT YOUR COMPANY WOULD BE DELETED FROM THE DIRECTORY OF SANITARILY APPROVED FOOD ESTABLISHMENT FOR ARMED FORCES PROCUREMENT AT YOUR REQUEST. BY LETTER OF DECEMBER 28, 1967, YOU NOTIFIED THE PROCUREMENT OFFICE THAT YOU HAD MADE NO SUCH REQUEST AND IN FACT DESIRED TO BE LISTED. ON DECEMBER 29, 1967, YOU WERE INFORMED THAT SANITARY APPROVAL WAS NO LONGER REQUIRED; HOWEVER, LATER THE SAME DAY YOU WERE ADVISED THAT THIS INFORMATION WAS ERRONEOUS AND WAS BASED ON A MISINTERPRETATION OF THE PERTINENT REGULATIONS. IMMEDIATE ACTION WAS UNDERTAKEN TO ARRANGE ANOTHER INSPECTION OF YOUR FACILITIES WHICH WAS CONDUCTED ON JANUARY 3, 1968. VARIOUS DEFECTS, INCLUDING TWO WHICH WERE CRITICAL, WERE DISCOVERED UPON INSPECTION OF YOUR PLANT MAKING DISAPPROVAL OF YOUR COMPANY AS A SOURCE OF SUPPLY MANDATORY PURSUANT TO PARAGRAPH 4.1 OF THE MILITARY STANDARD 1105, MINIMUM SANITARY STANDARDS FOR BAKERIES. ACCORDINGLY, THE CONTRACT WAS AWARDED TO THE NEXT LOW OFFEROR ON JANUARY 5, 1968, AFTER THE CONTRACTING OFFICER DETERMINED PURSUANT TO ARMED SERVICES PROCUREMENT REGULATION 1-705.4 (C) (IV) THAT TIME DID NOT PERMIT THE MATTER TO BE REFERRED TO THE SMALL BUSINESS ADMINISTRATION, EVEN IF SUCH ACTION WAS OTHERWISE APPROPRIATE.

THE NEED FOR SANITARY APPROVAL OF YOUR PLANT FACILITIES BY THE UNITED STATES ARMY VETERINARY CORPS WAS AFFIRMATIVELY SET FORTH IN THE CAUTION SHEET ATTACHED TO THE SOLICITATION AND IN PARAGRAPH 17 OF THE STANDARD CONDITIONS. PART 9, SECTION 1 OF THE ARMED SERVICES PROCUREMENT REGULATION, WHICH APPLIES BOTH TO ADVERTISED AND NEGOTIATED PROCUREMENTS, SEE ASPR 1-901, REQUIRES THAT CONTRACTS BE AWARDED ONLY TO RESPONSIBLE PROSPECTIVE CONTRACTORS AND ESTABLISHES MINIMUM STANDARDS OF RESPONSIBILITY WHICH A CONTRACTOR MUST MEET. ASPR 1-903.2 (B) PROVIDES IN PART:

"/B) STANDARD FOR FOOD. PROCUREMENT OF FOOD SHALL BE MADE ONLY FROM THOSE SOURCES WHICH, IN ADDITION TO MEETING THE STANDARDS IN 1 903.1, ARE APPROVED WITH RESPECT TO SANITATION IN ACCORDANCE WITH STANDARDS AND PROCEDURES PRESCRIBED IN AR 40-657 * * *.' ARMY REGULATION 40-657 REQUIRES, AS DID THE SOLICITATION, SANITARY APPROVAL OF YOUR FIRM BY THE UNITED STATES ARMY VETERINARY CORPS. BECAUSE OF THE DEFECTS NOTED UPON INSPECTION, YOUR FIRM WAS DISAPPROVED AS A SOURCE OF SUPPLY PURSUANT TO PARAGRAPH 4.1 OF MILITARY STANDARD 1105, MINIMUM SANITARY STANDARDS FOR BAKERIES. TIME DID NOT PERMIT CORRECTION OF THESE DEFECTS TO QUALIFY YOUR COMPANY AS A RESPONSIBLE CONTRACTOR.

THIS OFFICE HAS CONSISTENTLY TAKEN THE POSITION THAT THE QUESTION OF RESPONSIBILITY IS PRIMARILY FOR DETERMINATION BY THE PROCUREMENT ACTIVITY AND WE WILL NOT QUESTION SUCH A DETERMINATION IN THE ABSENCE OF A CLEAR SHOWING OF BAD FAITH, ABUSE OF DISCRETION OR LACK OF A REASONABLE BASIS FOR THE CONCLUSION REACHED. IN THIS INSTANCE, WE PERCEIVE NO EVIDENCE OF ANY OF THE ABOVE.

THE REMOVAL OF YOUR COMPANY FROM THE DIRECTORY OF SANITARILY APPROVED FOOD ESTABLISHMENTS FOR ARMED FORCES PROCUREMENT, THEREBY NECESSITATING A SANITARY INSPECTION, WAS THE RESULT OF YOUR STATEMENT TO INSPECTING OFFICERS FROM VETERINARY CORPS REQUESTING TO MAKE A ROUTINE SANITARY INSPECTION THAT THEY COULD INSPECT IF THEY WISHED. THE INSPECTING OFFICERS INTERPRETED THIS STATEMENT TOGETHER WITH OTHER EXPRESSIONS OF INDIFFERENCE TO MEAN THAT YOU DID NOT CARE WHETHER YOU WERE INSPECTED. SINCE THE CHOICE OF BEING INSPECTED OR NOT WAS WITHIN THE PREROGATIVE OF THE PLANT OPERATOR, NO INSPECTION WAS MADE AND YOUR COMPANY WAS REMOVED FROM THE APPROVED LIST WITHOUT PREJUDICE. ACCORDINGLY, WE CANNOT CONCUR THAT YOUR FAILURE TO BE SANITARILY APPROVED IN TIME FOR AWARD OF CONTRACT DSA-136-8-N-00042 WAS ATTRIBUTABLE TO ACTIONS ON THE PART OF THE GOVERNMENT.

YOU ALSO CONTEND THAT THE MANNER IN WHICH THE PROCUREMENT OFFICE HANDLED THE OFFERS WAS HIGHLY IRREGULAR. IN PARTICULAR YOU WERE CONCERNED WITH ALLOWING SUBMISSION OF OFFERS BY TELEPHONE OR LETTER, THE OPENING OF OFFERS PRIOR TO CLOSING DATE, AND REQUESTING CONFIRMATION OF PRICES QUOTED IN YOUR OFFER.

AS PREVIOUSLY NOTED, THIS PROCUREMENT WAS NEGOTIATED. THEREFORE, THE RULES APPLICABLE TO ADVERTISED PROCUREMENTS DO NOT APPLY. PROVISION IN THE SOLICITATION FOR ORAL OFFERS IS, OF COURSE, INCONSISTENT WITH THE OPENING OF SEALED BIDS AT A PUBLICLY ANNOUNCED TIME. HOWEVER, THIS DOES NOT PERMIT YOUR OFFER TO BE REVEALED TO OTHER OFFERORS. ASPR 3-507.2 SPECIFICALLY PROHIBITS THE PROCUREMENT OFFICERS FROM REVEALING INFORMATION TO ANY OTHER POTENTIAL SUPPLIER WHICH MAY AFFORD HIM AN ADVANTAGE. THE RECORD DOES NOT CONTAIN EVIDENCE THAT SUCH REVELATION TOOK PLACE.

THE REQUEST FOR CONFIRMATION OF PRICES IN YOUR OFFER ON ITEMS 1 AND 2 OCCURRED BECAUSE THE PROCUREMENT OFFICER NOTED A VARIANCE IN PRICES QUOTED PER POUND FOR THE SAME SWEET DOUGH MIX PRODUCT WHICH HE BELIEVED MAY HAVE RESULTED FROM A MISTAKE. THE PROCUREMENT OFFICER'S REQUEST FOR VERIFICATION IN SUCH CIRCUMSTANCES IS PROPER TO AVOID THE AWARD OF A CONTRACT ON THE BASIS OF A PROPOSAL WHICH THE OFFEROR HAD NO INTENTION MAKING. SEE 20 COMP. GEN. 652 AND CASES CITED THEREIN.

FOR THE REASONS SET FORTH ABOVE WE FIND NO BASIS TO OBJECT TO THE MANNER IN WHICH THIS CONTRACT WAS AWARDED. THE ALLEGED DIFFICULTIES ENCOUNTERED WITH THE DEFENSE PERSONNEL SUPPORT CENTER PRIOR TO THIS PROCUREMENT ARE RELEVANT TO THE IMMEDIATE PROTEST ONLY TO THE EXTENT THAT THEY ARE ILLUSTRATIVE OF IRREGULARITIES IN THE INSTANT CONTRACT AWARDED. INASMUCH AS NO EVIDENCE OF IRREGULARITY HAS BEEN DISCOVERED AND THOSE ALLEGATIONS WERE PREVIOUSLY CONSIDERED IN SEPARATE REPORTS FROM THE ADMINISTRATIVE AGENCY MADE AVAILABLE TO YOUR COMPANY, WE HAVE NOT CONSIDERED THEM INDIVIDUALLY HEREIN.