B-167738, DEC. 1, 1969

B-167738: Dec 1, 1969

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

AWARD IS AFFIRMED. BURDEN OF ESTABLISHING QUALIFICATIONS IS WHOLLY ON BIDDER. DUTY AND RESPONSIBILITY OF DETERMINING STAR ROUTE BIDDERS' QUALIFICATIONS IS VESTED IN POST OFFICE DEPARTMENT. THAT IT IS QUALIFIED TO HAVE ITS BID CONSIDERED UNDER 39 U.S.C. 6420. THERE IS NO OBJECTION TO DEPT.'S DETERMINATION THAT BIDDER IS NOT QUALIFIED FOR AWARD. GILBERTSON AND CLAIBORNE: REFERENCE IS MADE TO YOUR LETTER OF AUGUST 14. ADVERTISEMENT 54-69 WAS ISSUED ON MAY 14. BIDS WERE OPENED AND ABSTRACTED. T-AND-C'S WAS THE LOWEST AT $212. THE NEXT LOWEST BID WAS IN THE AMOUNT OF $229. THE TERMS OF WHICH WERE REFLECTED IN PARAGRAPH 2 OF THE "INSTRUCTIONS TO IDDERS" PORTION OF THE ADVERTISEMENT. PROVIDES: "/A) THE POSTMASTER GENERAL MAY NOT CONSIDER THE BID OF AN INDIVIDUAL FOR A STAR ROUTE CONTRACT UNLESS THE BIDDER IS A LEGAL RESIDENT OF THE COUNTY IN WHICH PART OF THE ROUTE LIES OR OF AN ADJOINING COUNTY.

B-167738, DEC. 1, 1969

POST OFFICE DEPARTMENT--STAR ROUTE CONTRACTS--BIDDER QUALIFICATIONS WHERE CONTRACTING OFFICER DETERMINED LOW BIDDER FOR STAR ROUTE SERVICE CONTRACT DID NOT MEET "ACTUALLY ENGAGED IN BUSINESS" REQUIREMENT OF 39 U.S.C. 6420 CONTAINED IN "INSTRUCTIONS TO BIDDERS" AND CONSEQUENTLY AWARDED CONTRACT TO SECOND LOW BIDDER, AWARD IS AFFIRMED, AS WHERE BIDDER MUST MEET CERTAIN QUALIFICATIONS AS STATUTORY PREREQUISITE TO HAVING BID CONSIDERED, BURDEN OF ESTABLISHING QUALIFICATIONS IS WHOLLY ON BIDDER, AND DUTY AND RESPONSIBILITY OF DETERMINING STAR ROUTE BIDDERS' QUALIFICATIONS IS VESTED IN POST OFFICE DEPARTMENT; AND WHERE STAR ROUTE BIDDER FAILS TO CLEARLY ESTABLISH, UPON REQUEST, THAT IT IS QUALIFIED TO HAVE ITS BID CONSIDERED UNDER 39 U.S.C. 6420, THERE IS NO OBJECTION TO DEPT.'S DETERMINATION THAT BIDDER IS NOT QUALIFIED FOR AWARD. SEE 35 COMP. GEN. 411 (1956).

TO WALTER, GILBERTSON AND CLAIBORNE:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 14, 1969, ON BEHALF OF TOLSON AND COLEMAN TRUCK LEASE CORPORATION (T-AND-C), PROTESTING AGAINST THE AWARD TO ANOTHER BIDDER OF A STAR ROUTE SERVICE CONTRACT UNDER ADVERTISEMENT NO. 54-69, ISSUED BY THE POST OFFICE DEPARTMENT (POD), ATLANTA, GEORGIA.

ADVERTISEMENT 54-69 WAS ISSUED ON MAY 14, 1969, TO PROCURE THE TRANSPORTATION OF MAIL, ON A REGULARLY SCHEDULED BASIS, BETWEEN ATLANTA, GEORGIA AND JACKSONVILLE, FLORIDA, FROM JULY 1, 1969 (OR SUCH SUBSEQUENT DATE AS MAY BE ORDERED), TO JUNE 30, 1973. ON JUNE 13, 1969, BIDS WERE OPENED AND ABSTRACTED. OF THE 13 BIDS TIMELY SUBMITTED, T-AND-C'S WAS THE LOWEST AT $212,328.09, AND THE NEXT LOWEST BID WAS IN THE AMOUNT OF $229,739. THE CONTRACTING OFFICER DETERMINED, HOWEVER, THAT T-AND-C DID NOT MEET THE REQUIREMENTS OF 39 U.S.C. 6420, AND, CONSEQUENTLY, AWARDED THE CONTRACT TO THE SECOND LOW BIDDER ON JUNE 26, 1969.

39 U.S.C. 6420, THE TERMS OF WHICH WERE REFLECTED IN PARAGRAPH 2 OF THE "INSTRUCTIONS TO IDDERS" PORTION OF THE ADVERTISEMENT, PROVIDES:

"/A) THE POSTMASTER GENERAL MAY NOT CONSIDER THE BID OF AN INDIVIDUAL FOR A STAR ROUTE CONTRACT UNLESS THE BIDDER IS A LEGAL RESIDENT OF THE COUNTY IN WHICH PART OF THE ROUTE LIES OR OF AN ADJOINING COUNTY. HE MAY NOT CONSIDER THE BID OF A FIRM, COMPANY, OR CORPORATION FOR SUCH A CONTRACT UNLESS IT IS ACTUALLY ENGAGED IN BUSINESS WITHIN THE COUNTY IN WHICH PART OF THE ROUTE LIES OR IN AN ADJOINING COUNTY.'

IN SUPPORT OF YOUR CONTENTION THAT T-AND-C WAS ENGAGED IN BUSINESS IN GEORGIA, YOU SUBMITTED SEVERAL LEDGER SHEETS, BEARING THE NAMES OF VARIOUS ATLANTA FIRMS, WHICH SHOWED DEBIT AND CREDIT ENTRIES FOR PERIODS PRIOR TO JUNE 13, 1969, AND A LETTER FROM THE SECRETARY OF THE STATE OF GEORGIA, DATED JUNE 22, 1967, WHICH INDICATES THAT YOUR CHARTER HAD BEEN FILED AND THAT T-AND-C WAS AUTHORIZED TO DO BUSINESS IN GEORGIA.

INSOFAR AS YOUR ACTIVITIES IN FLORIDA ARE CONCERNED, YOU SUBMITTED LEDGER CARDS SIMILAR TO THOSE ABOVE WITH THE EXCEPTION THAT THESE SHOWED DEBITS AND CREDITS FOR TWO JACKSONVILLE FIRMS; CORRESPONDENCE BETWEEN T-AND-C AND THE SECRETARY OF THE STATE OF FLORIDA, DATED MARCH 25 AND 28, 1969, EVIDENCING AN INTENT TO REGISTER WITH THAT OFFICER; AUTHORITY FROM THE SECRETARY OF STATE, DATED JUNE 23, 1969, AUTHORIZING AND PERMITTING T-AND- C TO DO BUSINESS IN FLORIDA; CORRESPONDENCE WITH THE FLORIDA DEPARTMENT OF MOTOR VEHICLES EVIDENCING A REQUEST FOR APPLICATION FORMS FOR FLORIDA TAG AND CERTIFICATE OF TITLE; A CHECK, DATED MARCH 14, 1969, DRAWN TO THE ORDER OF A JACKSONVILLE REALTOR WHICH IS NOTATED "FOR PURCHASE OF JACKSONVILLE, FLA. BRANCH; " AND A LETTER, DATED APRIL 2, 1969, BEARING A KNOXVILLE, TENNESSEE ADDRESS, SOLICITING BUSINESS FROM A JACKSONVILLE FIRM.

THE RECORD ALSO SHOWS TWO AGREEMENTS MADE PRIOR TO JUNE 13, 1969, WITH THE THEN HOLDERS OF THE STAR ROUTE CONTRACT INVOLVED HEREIN AND T AND-C. BY THESE AGREEMENTS T-AND-C ALLOWED ITS SEMITRAILERS TO BE USED FOR THE TRANSPORTING OF MAIL BETWEEN ATLANTA AND JACKSONVILLE IN RETURN FOR COMPENSATION BASED ON MILEAGE. HOWEVER, THESE AGREEMENTS MAY NOT BE CONSIDERED AS DOING BUSINESS OTHER THAN THE TRANSPORTATION OF MAIL UNDER CONTRACT, SINCE THE AGREEMENTS INVOLVED CONTRACTS FOR THE CARRIAGE OF MAIL BY STAR ROUTE CONTRACTORS.

FOR ITS PART, POD CONTENDS THAT T-AND-C WAS NOT ACTIVELY ENGAGED IN A BUSINESS OTHER THAN THE TRANSPORTING OF MAIL IN EITHER JACKSONVILLE OR ATLANTA. IT POINTS OUT THAT THE LEDGER SHEETS DID NOT DISCLOSE THAT THE TRANSACTIONS RECORDED WERE WITH T-AND-C OR THE NATURE OF THE TRANSACTIONS; THAT A POSTAL INSPECTION SERVICE INVESTIGATION HAD DISCLOSED THAT IN JACKSONVILLE, T-AND-C HAD NOT APPLIED FOR OR BEEN ISSUED A CITY BUSINESS LICENSE; THAT NO MAIL HAD BEEN DELIVERED TO THE ADDRESS A T-AND-C REPRESENTATIVE HAD GIVEN TO THE CONTRACTING OFFICER; AND THAT A PHONE HAD BEEN APPLIED FOR ON JUNE 16, 1969, BUT THAT THE BILL WAS TO BE SENT TO KNOXVILLE, TENNESSEE. IN ATLANTA, PROPERTY HAD BEEN RENTED BUT NO CITY LICENSE HAD BEEN APPLIED FOR OR ISSUED TO T-AND C. ADDITIONALLY, IT IS REPORTED THAT MR. JACK L. BEELER, A T-AND-C REPRESENTATIVE, STATED, AFTER BID OPENING, TO THE CONTRACTING OFFICER THAT T-AND-C HAD TRIED TO GET INTO BUSINESS IN JACKSONVILLE, BUT HAD EXPERIENCED DIFFICULTIES IN PURCHASING A SITE AND AS A RESULT WAS LEASING TEMPORARY QUARTERS. HE ALSO PURPORTEDLY STATED THAT T-AND-C HAD BEEN UNABLE TO BEGIN OPERATIONS IN ATLANTA AND WAS THEREFORE DOING BUSINESS THROUGH AN AGENT AT AN ATLANTA TRUCK STOP.

BY LETTER OF SEPTEMBER 30, 1969, TO YOU, OUR OFFICE REQUESTED THAT CERTAIN ADDITIONAL INFORMATION BE SUBMITTED WHICH WOULD CLARIFY THE ACTIVITIES OF T-AND-C IN BOTH ATLANTA AND JACKSONVILLE. TO DATE, NO ANSWER TO THAT REQUEST HAS BEEN RECEIVED; THEREFORE, THE PROTEST WILL BE DETERMINED ON THE BASIS OF THE RECORD PRESENTLY BEFORE US.

AS WE VIEW THIS RECORD, THERE IS NOTHING THEREIN WHICH CONVINCES US THAT T-AND-C WAS ACTUALLY ENGAGED IN BUSINESS AT JACKSONVILLE OR ATLANTA AT THE TIME OF BID OPENING OR AWARD. AT BEST, THE DOCUMENTS SUBMITTED BY T-AND-C ON THE POINT ARE AMBIGUOUS. EVEN ASSUMING THAT THE LEDGER SHEETS REPRESENT TRANSACTIONS IN WHICH T-AND-C WAS ENGAGED, THERE IS STILL NO INDICATION OF THE NATURE OF THE TRANSACTIONS REPRESENTED OR WHERE THEY TOOK PLACE.

WHILE T-AND-C MAY HAVE BEEN AUTHORIZED TO DO BUSINESS IN BOTH FLORIDA AND GEORGIA, SUCH AUTHORITY IS NOT CONCLUSIVE ON THE ISSUE OF WHETHER T-AND-C WAS IN FACT,"ACTUALLY ENGAGED IN BUSINESS" WITHIN THE AREA COVERED BY THE STAR ROUTE. THE SAME HOLDS TRUE WITH RESPECT TO THE TWO INTERLINE AGREEMENTS BETWEEN T-AND-C AND PRIOR HOLDERS OF THE STAR ROUTE. NEITHER AGREEMENT INDICATES WHERE IT WAS EXECUTED NOR IS THERE ANY EVIDENCE TO SHOW THAT EITHER CONTRACT WAS EVER PERFORMED, I.E., THAT T-AND-C SEMITRAILERS WERE EVER USED BY THESE PRIOR STAR ROUTE HOLDERS TO TRANSPORT THE MAIL FROM ATLANTA TO JACKSONVILLE.

THE ACTIVITIES OF T-AND-C IN BOTH OF THESE CITIES CERTAINLY, WE THINK, EVIDENCE AN ATTEMPT TO START OPERATIONS IN THESE LOCATIONS. HOWEVER, AGAIN, THERE IS NOTHING IN THE RECORD WHICH CLEARLY SHOWS THAT T-AND-C WAS IN FACT ENGAGING IN BUSINESS IN EITHER ATLANTA OR JACKSONVILLE. ON THE CONTRARY, THE PRESIDENT OF T-AND-C AS LATE AS JULY 3, 1969, IN A LETTER TO THE CHIEF, HIGHWAYS TRANSPORTATION BRANCH, POD, ATLANTA, IN FACT, STILL REFERS TO JACKSONVILLE AND ATLANTA AS AREAS OF ,PLANNED EXPANSION.' THE STATEMENT ALLEGEDLY MADE BY MR. BEELER TO THE CONTRACTING OFFICER THAT T- AND-C HAD TRIED BUT HAD BEEN UNABLE TO START OPERATIONS IN THESE TWO CITIES ALSO INDICATES THAT T AND-C WAS NOT, AT THE TIME OF BID OPENING, ENGAGED IN BUSINESS IN EITHER CITY. HIS FURTHER STATEMENT THAT T-AND-C WAS DOING BUSINESS THROUGH AN AGENT AT AN ATLANTA TRUCK STOP IS TOTALLY UNSUPPORTED BY ANY KIND OF EVIDENCE. EVEN IF WE ACCEPT THE FACT THAT AN AGENT WAS APPOINTED BY T-AND-C, THERE IS NOTHING IN THE RECORD TO SHOW THAT HE ACTUALLY ENGAGED IN BUSINESS ON BEHALF OF T-AND-C.

WHERE, AS HERE, A BIDDER MUST MEET CERTAIN QUALIFICATIONS AS A STATUTORY PREREQUISITE TO HAVING ITS BID CONSIDERED, THE BURDEN OF ESTABLISHING THOSE QUALIFICATIONS IS WHOLLY ON THE BIDDER. WE HAVE RECOGNIZED THAT THE DUTY AND RESPONSIBILITY OF DETERMINING THE QUALIFICATION OF STAR ROUTE BIDDERS IS VESTED IN THE FIRST INSTANCE IN THE POD. SEE 35 COMP. GEN. 411, 417 (1956). WHERE, AS HERE, A STAR ROUTE BIDDER FAILS TO CLEARLY ESTABLISH, UPON REQUEST, THAT IT IS QUALIFIED TO HAVE ITS BID CONSIDERED UNDER 39 U.S.C. 6420, WE WILL NOT OBJECT TO THE POD'S DETERMINATION THAT IT IS NOT QUALIFIED FOR AN AWARD.