B-164060, JUL. 3, 1968

B-164060: Jul 3, 1968

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MONTEMELO FOODS: FURTHER REFERENCE IS MADE TO YOUR LETTER DATED APRIL 15. YOU CONTEND THAT AWARD SHOULD HAVE BEEN MADE TO YOU AS THE LOWEST BIDDER UNDER THE SOLICITATION. SINCE YOU WERE A NEW BIDDER INSOFAR AS THE PROCUREMENT ACTIVITY WAS CONCERNED. A COMPLETE PREAWARD SURVEY OF YOUR CAPABILITIES WAS REQUESTED BY THE CONTRACTING OFFICER. THESE REPORTS INDICATED THAT YOU DID NOT HAVE ADEQUATE FINANCIAL RESOURCES. THE PREAWARD SURVEY REPORT OF YOUR CAPABILITIES WAS RECEIVED FROM THE DEFENSE CONTRACT ADMINISTRATION SERVICES DISTRICT (DCASD). FOR THE REASONS STATED THEREIN AWARD TO YOU WAS NOT RECOMMENDED. THE CONTRACTING OFFICER DETERMINED THAT HE WAS UNABLE TO CONCLUDE THAT YOU WERE A RESPONSIBLE PROSPECTIVE CONTRACTOR.

B-164060, JUL. 3, 1968

TO MONTE MOSES D.B.A., MONTEMELO FOODS:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED APRIL 15, 1968, AND ENCLOSURES, PROTESTING THE AWARDS MADE TO OTHER BIDDERS UNDER SOLICITATION NO. DSA-130-8-B-01154, ISSUED BY THE DEFENSE PERSONNEL SUPPORT CENTER, DEFENSE SUPPLY AGENCY (DSA). YOU CONTEND THAT AWARD SHOULD HAVE BEEN MADE TO YOU AS THE LOWEST BIDDER UNDER THE SOLICITATION.

THE SOLICITATION, ISSUED ON MARCH 11, 1968, REQUESTED BIDS ON QUANTITIES OF CANNED HAM CHUNKS, A PORTION OF WHICH HAD BEEN SET-ASIDE FOR PROCUREMENT FROM SMALL BUSINESS FIRMS ONLY.

YOU SUBMITTED A BID ON A PORTION OF THE NON-SET-ASIDE PORTION, AND UPON EVALUATION APPEARED TO BE THE LOWEST BID RECEIVED. SINCE YOU WERE A NEW BIDDER INSOFAR AS THE PROCUREMENT ACTIVITY WAS CONCERNED, A COMPLETE PREAWARD SURVEY OF YOUR CAPABILITIES WAS REQUESTED BY THE CONTRACTING OFFICER, INCLUDING CREDIT REPORTS. THESE REPORTS INDICATED THAT YOU DID NOT HAVE ADEQUATE FINANCIAL RESOURCES. ON APRIL 8, 1968, THE PREAWARD SURVEY REPORT OF YOUR CAPABILITIES WAS RECEIVED FROM THE DEFENSE CONTRACT ADMINISTRATION SERVICES DISTRICT (DCASD), PASADENA, CALIFORNIA, AND FOR THE REASONS STATED THEREIN AWARD TO YOU WAS NOT RECOMMENDED. ON THAT DATE, AFTER A COMPLETE EVALUATION OF ALL AVAILABLE EVIDENCE BEARING ON YOUR RESPONSIBILITY, INCLUDING THE RESULTS OF THE PREAWARD SURVEY, THE CONTRACTING OFFICER DETERMINED THAT HE WAS UNABLE TO CONCLUDE THAT YOU WERE A RESPONSIBLE PROSPECTIVE CONTRACTOR. SPECIFICALLY, THE PREAWARD SURVEY BOARD RECOMMENDED NO AWARD ON THE BASIS OF UNSATISFACTORY FINDINGS IN THE AREAS OF PRODUCTION CAPABILITY, PLANT FACILITIES AND EQUIPMENT, FINANCIAL CAPABILITY, QUALITY ASSURANCE CAPABILITY, AND ABILITY TO MEET THE REQUIRED URGENT DELIVERY SCHEDULE.

AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY IS REQUIRED TO BE MADE BY THE CONTRACTING OFFICER UNDER ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1-904.1 RESPECTING THE CAPABILITIES OF A PROSPECTIVE CONTRACTOR BEFORE MAKING AN AWARD TO SUCH A BIDDER. SPECIFICALLY, ASPR 1-902 PROVIDES THAT: "DOUBT AS TO PRODUCTIVE CAPACITY OR FINANCIAL STRENGTH WHICH CANNOT BE RESOLVED AFFIRMATIVELY SHALL REQUIRE A DETERMINATION OF NONRESPONSIBILITY.'

SINCE YOUR BID CONTAINED A SELF-CERTIFICATION THAT YOU WERE A SMALL BUSINESS CONCERN, THE MATTER OF YOUR RESPONSIBILITY AS TO CAPACITY AND CREDIT WAS REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA), LOS ANGELES. THIS REFERRAL WAS BASED ON THE ASSUMPTION THAT SBA WOULD PROCESS THE MATTER IN 4 TO 5 DAYS SINCE THE ACCEPTANCE TIME OF BIDS UNDER CONSIDERATION WOULD EXPIRE SHORTLY. SUBSEQUENTLY, SBA ORALLY ADVISED THAT A DETERMINATION COULD NOT BE MADE PRIOR TO THE BID EXPIRATION DATES. ACCORDINGLY, THE CONTRACTING OFFICER ON APRIL 11, 1968, ISSUED A CERTIFICATE OF URGENCY PURSUANT TO ASPR 1-705.4 (C) (IV) THAT AWARDS MUST BE MADE WITHOUT DELAY, AND HE STATED THEREIN THAT HE PROPOSED TO WITHDRAW THE REFERRAL FROM SBA. HOWEVER, ON APRIL 12, 1968, AND PRIOR TO EFFECTING SUCH WITHDRAWAL, SBA ADVISED THE CONTRACTING OFFICER THAT YOU HAD DECLINED THE OPPORTUNITY TO FILE FOR A CERTIFICATE OF COMPETENCY (COC), AND THAT SBA WOULD TAKE NO FURTHER ACTION. SBA THEREFORE CLOSED ITS FILE ON THE MATTER.

ON APRIL 12, 1968, AWARDS UNDER THE NON-SET-ASIDE PORTION OF THE SOLICITATION WERE MADE TO THE BRYAN BROTHERS PACKING COMPANY, THE NORTH AMERICAN PACKING CORP., AND OSCAR MAYER AND CO., INC., AS THE LOWEST RESPONSIVE, RESPONSIBLE BIDDERS AT PRICES ADMINISTRATIVELY DETERMINED TO BE FAIR AND REASONABLE. WE ARE ADVISED THAT ALL ELIGIBLE BIDDERS HAVE DECLINED TO ACCEPT ANY PART OF THE SET-ASIDE PORTION OF THE SOLICITATION. ACCORDINGLY, THE SET-ASIDE WILL BE CANCELLED AND WILL BE RESOLICITED WITH REVISED DELIVERY DATES AND WITH PROVISION FOR EXTENSION OF THOSE DATES IN THE EVENT OF DELAYED AWARDS AS CONTEMPLATED BY ASPR 1-305.3 (B).

OUR OFFICE HAS CONSISTENTLY HELD THAT THE DETERMINATION OF A PROSPECTIVE 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 A LACK OF SUBSTANTIAL GROUNDS FOR THE ADMINISTRATIVE DETERMINATION, THERE IS NO BASIS FOR LEGAL OBJECTION. COMP. GEN. 430, 435. UNDER THE CIRCUMSTANCES DISCLOSED BY THE FILE BEFORE US, IT IS REASONABLE TO CONCLUDE THAT THE REFUSAL OF THE PROCUREMENT ACTIVITY TO MAKE AWARD TO YOU ON THE BASIS OF YOUR INABILITY TO MEET THE MINIMUM STANDARDS PRESCRIBED FOR RESPONSIBLE PROSPECTIVE CONTRACTORS BY ASPR 1-903.1 IS NOT SUBJECT TO QUESTION BY OUR OFFICE.