B-163378, MAR. 15, 1968

B-163378: Mar 15, 1968

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AN EXPERIENCE TIME QUALIFICATION CLAUSE INCLUDED IN AN INVITATION WHICH IS DETERMINED TO BE NECESSARY AND IS REASONABLY RELATED TO THE PURPOSE OF THE PROCUREMENT AND IS INTENDED AS A MEASURE OF EVALUATING BASIC QUALIFICATIONS OF CAPABILITY AND RESPONSIBILITY HAS BEEN HELD TO BE PROPER. IN INSTANT CASE PRIME CONTRACT HAS BEEN TERMINATED AND NEGOTIATION PROCEDURES ARE TO BE UTILIZED. TO METALAB EQUIPMENT COMPANY: FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JANUARY 19. REQUESTING OUR REVIEW OF THE PROPRIETY OF THE GENERAL SERVICES ADMINISTRATION (GSA) APPLICATION OF AN EXPERIENCE TIME QUALIFICATION CONTRACT CLAUSE UNDER WHICH YOU WERE DENIED THE OPPORTUNITY TO ENTER UPON AND COMPLETE THE WORK REQUIRED OF YOU AS A SUBCONTRACTOR TO THE PRIME CONTRACTOR.

B-163378, MAR. 15, 1968

BIDDERS - RESPONSIBILITY - EXPERIENCE DECISION TO METALAB EQUIPMENT CO. DENYING PROTEST AGAINST INCLUSION OF AN EXPERIENCE TIME QUALIFICATION CLAUSE IN A SUBCONTRACT FOR CONSTRUCTION OF TEMPERATURE ROOMS FOR N.I.H. IN PRIME CONTRACT AWARDED BY GSA. AN EXPERIENCE TIME QUALIFICATION CLAUSE INCLUDED IN AN INVITATION WHICH IS DETERMINED TO BE NECESSARY AND IS REASONABLY RELATED TO THE PURPOSE OF THE PROCUREMENT AND IS INTENDED AS A MEASURE OF EVALUATING BASIC QUALIFICATIONS OF CAPABILITY AND RESPONSIBILITY HAS BEEN HELD TO BE PROPER. IN INSTANT CASE PRIME CONTRACT HAS BEEN TERMINATED AND NEGOTIATION PROCEDURES ARE TO BE UTILIZED.

TO METALAB EQUIPMENT COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JANUARY 19, 1968, WITH ENCLOSURE, REQUESTING OUR REVIEW OF THE PROPRIETY OF THE GENERAL SERVICES ADMINISTRATION (GSA) APPLICATION OF AN EXPERIENCE TIME QUALIFICATION CONTRACT CLAUSE UNDER WHICH YOU WERE DENIED THE OPPORTUNITY TO ENTER UPON AND COMPLETE THE WORK REQUIRED OF YOU AS A SUBCONTRACTOR TO THE PRIME CONTRACTOR.

CONTRACT NO. GS-03B-14589, FOR THE CONSTRUCTION OF NATIONAL INSTITUTES OF MENTAL HEALTH/NATIONAL INSTITUTES OF NEUROLOGICAL DISEASES AND BLINDNESS (BUILDING 36), NATIONAL CANCER INSTITUTE (BUILDING 37) AND CAFETERIA (BUILDING 35), WAS AWARDED TO THE BLAKE CONSTRUCTION COMPANY, INC., ON AUGUST 27, 1965. NOTICE TO PROCEED WAS ISSUED ON SEPTEMBER 16, 1965, AND RECEIPT THEREOF WAS ACKNOWLEDGED BY BLAKE ON SEPTEMBER 17, 1965.

SECTION 60 OF THE CONTRACT SPECIFICATIONS REQUIRED BLAKE TO PROVIDE CERTAIN PREFABRICATED CONTROLLED TEMPERATURE ROOMS, COMPLETE AS SCHEDULED. LOCATION, NOMINAL SIZE, DOOR SWING, ETC., WERE SET FORTH ON THE CONTRACT DRAWINGS. PARAGRAPH 60-01C OF THE SPECIFICATIONS PROVIDES AS FOLLOWS:

"ROOMS SHALL BE PRODUCT OF ESTABLISHED MANUFACTURER WITH PROVEN RECORD OF SATISFACTORY INSTALLATIONS OF SIMILAR CONSTRUCTION AND CONTROL IN USE FOR A MINIMUM PERIOD OF TWO YEARS PRIOR TO THE DATE OF BID INVITATION.'

PARAGRAPH 60-02 OF THE SPECIFICATION PROVIDES:

"TECHNICAL SERVICES TO BE FURNISHED.

"A. ERECTION SHALL BE BY A SPECIALTY SUB-CONTRACTOR UNDER THE DIRECT SUPERVISION OF THE MANUFACTURER, WHO SHALL SUPERVISE ASSEMBLY OF WALL PANELS, FLOOR AND CEILING PANS, AND OTHER COMPONENTS FOR ERECTION OF ROOMS, TO MAKE CALIBRATIONS AND ADJUSTMENT OF MECHANICAL FEATURES AND TO CONDUCT SITE TESTING PROCEDURES. SUCH SERVICE SHALL CONTINUE UNTIL ACCEPTANCE OF THE ROOMS BY THE GOVERNMENT.'

ON JANUARY 9, 1967, TWO YEARS AFTER AWARD OF THE CONTRACT, BLAKE REQUESTED THE CONTRACTING OFFICER TO WAIVE THE REQUIREMENT THAT YOUR PRODUCT BE IN USE 2 YEARS PRIOR TO THE DATE OF THE INVITATION FOR BIDS. THE ADMINISTRATIVE OFFICE REPLIED TO BLAKE STATING THAT "THE QUALIFICATION CLAUSE 60-01C FOR PREFABRICATED CONTROLLED TEMPERATURE ROOMS" COULD NOT BE WAIVED. ON APRIL 13, 1967, YOU WROTE TO GSA IN SUPPORT OF YOUR PROPOSAL AS A SUBCONTRACTOR TO BLAKE COVERING THE SCIENTIFIC EQUIPMENT COMPRISING THE CONTROLLED TEMPERATURE ROOMS. GSA ADVISED YOU BY LETTER OF JUNE 27, 1967, THAT IT FOUND NEITHER NECESSITY NOR JUSTIFICATION FOR ABANDONING THE REQUIREMENTS WHICH WERE CONSIDERED NECESSARY BY THE GOVERNMENT IN THE DESIGN OF THIS PROJECT, ON WHICH THE PRIME CONTRACTOR BID AND WHICH ARE STILL CONSIDERED ESSENTIAL TO THE GOVERNMENT'S NEEDS. BLAKE WAS FINALLY INFORMED ON AUGUST 28, 1967, THAT ITS OFFER TO UTILIZE YOUR COMPANY AS A MANUFACTURER MEETING THE QUALIFICATIONS OF THE SPECIFICATIONS FOR CONTROLLED TEMPERATURE ROOMS WAS REJECTED.

THE FACT THAT YOUR COMPANY DOES NOT MEET THE EXPERIENCE TIME QUALIFICATION CLAUSE IS BEYOND QUESTION. YOUR LETTER REQUESTING ADMINISTRATIVE REVIEW, TOGETHER WITH BLAKE'S REQUEST FOR WAIVER OF THE CLAUSE, REVEALS YOUR INABILITY TO MEET THIS REQUIREMENT. WHILE YOUR COMPANY HAS BEEN APPROVED AS A SUPPLIER FOR A CONSIDERABLE AMOUNT OF LABORATORY EQUIPMENT, CASE WORK, AND FUME HOODS, YOU HAVE ONLY RECENTLY ENTERED INTO THE ENVIRONMENTAL ROOM BUSINESS. A GSA INSPECTION OF YOUR PLANT REVEALED THAT YOU HAD NO PRESENT MANUFACTURING FACILITY FOR THE ROOMS, NOR ANY PAST MANUFACTURING EXPERIENCE.

IT IS REPORTED THAT THE EXPERIENCE TIME QUALIFICATION CLAUSE IN PARAGRAPH 60-01C, AND THE REQUIREMENT OF ERECTION OF THE ROOMS BY A SPECIALTY SUBCONTRACTOR, WERE INCLUDED IN THE CONTRACT SPECIFICATIONS AT THE REQUEST OF THE NATIONAL INSTITUTES OF HEALTH (NIH) WHICH IS THE USING AGENCY. IS THAT AGENCY'S POSITION THAT THE ROOMS ARE NECESSARY FOR THE PERFORMANCE OF VITAL EXPERIMENTS CONNECTED WITH THEIR RESEARCH. NIH HAS REPORTED THAT CONSIDERABLE EFFORT BOTH IN RESEARCHER'S TIME AND APPROPRIATED FUNDS IS TIED UP IN EXPERIMENTS, AND THAT THE FAILURE OF THE CONSTANT TEMPERATURE ROOMS TO MAINTAIN SPECIFIED CLIMATIC CONDITIONS, BOTH OF ABSOLUTE TEMPERATURE AND RELATIVE HUMIDITY, COULD BE FATAL TO EXPERIMENTS WHICH HAVE BEEN IN PROGRESS FOR MANY YEARS. IT CAN BE SEEN THAT SUCH FAILURE COULD RESULT IN DESTRUCTIVE LOSS OF EXPERIMENTS AND THUS DELAY SOLUTION OF CRITICAL HEALTH PROBLEMS. IT IS FURTHER REPORTED THAT PAST EXPERIENCE WITH CONTROLLED TEMPERATURE ROOMS AT NATIONAL INSTITUTES OF HEALTH HAS SHOWN CONSIDERABLE TECHNICAL DIFFICULTIES ASSOCIATED WITH THE DESIGN AND CONSTRUCTION OF THIS SPECIAL EQUIPMENT AND THAT EVEN MANUFACTURERS WITH EXPERIENCE IN THE FIELD HAVE HAD OPERATING TROUBLE WHICH CALLED FOR CONSIDERABLE TIME AND EFFORT TO RESOLVE.

IT IS THE ADMINISTRATIVE CONCLUSION THAT THE EXPERIENCE TIME QUALIFICATION CLAUSE WAS DETERMINED NECESSARY IN THE BEST INTERESTS OF THE GOVERNMENT AND WAS INCLUDED IN THE SPECIFICATIONS ISSUED WITH THE BIDDING DOCUMENTS. IT WAS REASONABLY RELATED TO THE PURPOSE OF THIS PROCUREMENT AND WAS NOT INCLUDED IN THE SPECIFICATIONS TO DISCRIMINATE AGAINST ANY PARTICULAR SUPPLIER BUT WAS INTENDED AS A MEASURE OF EVALUATING BASIC QUALIFICATIONS OF CAPABILITY AND RESPONSIBILITY.

WE HAVE HELD THAT AWARD OF A CONTRACT PURSUANT TO THE ADVERTISING STATUTES MAY BE LIMITED TO THOSE BIDDERS MEETING SPECIFIED QUALITATIVE AND QUANTITATIVE EXPERIENCE REQUIREMENTS IN A SPECIALIZED FIELD WHERE THE INVITATION SO PROVIDES AND UPON A PROPER DETERMINATION THAT THE INTERESTS OF THE GOVERNMENT WOULD THEREBY BE SERVED. MOREOVER, A CONTRACT MAY PROPERLY REQUIRE AS A CONDITION OF SUBCONTRACTOR ELIGIBILITY SPECIFIC EXPERIENCE REQUIREMENTS IN A SPECIALIZED FIELD. 37 COMP. GEN. 196; ID. 420; 41 ID. 192. WE HAVE HELD FURTHER THAT A CONTRACT CONDITION WHICH WOULD PRECLUDE SUBCONTRACTING, EXCEPT SUBJECT TO DETERMINATION AND APPROVAL BY THE CONTRACTING OFFICER OF THE SUBCONTRACTOR'S QUALIFICATIONS TO PERFORM THE WORK IN A CAPABLE AND RESPONSIBLE MANNER, IS PERMISSIBLE UNDER THE COMPETITIVE PROCUREMENT SYSTEM TO PROTECT THE GOVERNMENT. COMP. GEN. 544.

WE ARE INFORMALLY ADVISED THAT THE CONTRACT WITH BLAKE HAS BEEN TERMINATED WITH RESPECT TO PROCUREMENT OF THE CONTROLLED TEMPERATURE ROOMS AND THAT THESE WILL BE OBTAINED BY NEGOTIATION PROCEDURES.

IN THE CIRCUMSTANCES, WE FIND NO LEGAL BASIS TO OBJECT TO THE ADMINISTRATIVE ACTION TAKEN.