B-169939, AUG. 18, 1970

B-169939: Aug 18, 1970

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FAILURE OF PROCURING AGENCY TO GIVE ADVANCE NOTICE TO UNSUCCESSFUL OFFERORS OF INTENDED AWARD WHICH WAS INADVERTENT DOES NOT AFFORD BASIS FOR DISTURBING AWARD MADE IN GOOD FAITH. DETERMINATION THAT LOW BIDDER WAS SMALL BUSINESS AND FACT THAT PROTESTANT WITHDREW APPEAL TO SIZE APPEALS BOARD PRECLUDES DISTUBING DETERMINATION THAT BIDDER WAS NOT SMALL BUSINESS. HENCE PROTEST IS DENIED. INC.: REFERENCE IS MADE TO YOUR LETTER OF MAY 28. IS THAT THE PROCURING ACTIVITY DID NOT FOLLOW THE PROVISIONS OF PARAGRAPH 1 703(B)(5) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) AND GIVE 5 WORKING DAYS' ADVANCE NOTICE TO APPARENTLY UNSUCCESSFUL OFFERORS OF THE INTENDED AWARD FOR THE PURPOSE OF PROTESTING THE SIZE STATUS OF THE PROPOSED CONTRACTOR.

B-169939, AUG. 18, 1970

BID PROTEST -- NOTICE TO UNSUCCESSFUL OFFERORS -- SBA DETERMINATION DENIAL OF PROTEST AGAINST AWARD TO ABC FOOD SERVICES, INC., BY NAVAL REGIONAL PROCUREMENT OFFICE UNDER 100-PER CENT SMALL BUSINESS SET-ASIDE PROCUREMENT. FAILURE OF PROCURING AGENCY TO GIVE ADVANCE NOTICE TO UNSUCCESSFUL OFFERORS OF INTENDED AWARD WHICH WAS INADVERTENT DOES NOT AFFORD BASIS FOR DISTURBING AWARD MADE IN GOOD FAITH. DETERMINATION THAT LOW BIDDER WAS SMALL BUSINESS AND FACT THAT PROTESTANT WITHDREW APPEAL TO SIZE APPEALS BOARD PRECLUDES DISTUBING DETERMINATION THAT BIDDER WAS NOT SMALL BUSINESS. HENCE PROTEST IS DENIED.

TO TIDEWATER MANAGEMENT SERVICES, INC.:

REFERENCE IS MADE TO YOUR LETTER OF MAY 28, 1970, PROTESTING THE AWARDS OF CONTRACTS TO ABC FOOD SERVICE, INC. (ABC), UNDER REQUESTS FOR PROPOSALS (RFP) NOS. N66314-70-R-4427 AND -4442, ISSUED BY THE NAVAL REGIONAL PROCUREMENT OFFICE, OAKLAND, CALIFORNIA.

THE FIRST BASIS OF YOUR PROTEST AGAINST THE AWARDS MADE TO ABC UNDER THE SUBJECT RFP'S, BOTH 100-PERCENT SMALL BUSINESS SET-ASIDES, IS THAT THE PROCURING ACTIVITY DID NOT FOLLOW THE PROVISIONS OF PARAGRAPH 1 703(B)(5) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) AND GIVE 5 WORKING DAYS' ADVANCE NOTICE TO APPARENTLY UNSUCCESSFUL OFFERORS OF THE INTENDED AWARD FOR THE PURPOSE OF PROTESTING THE SIZE STATUS OF THE PROPOSED CONTRACTOR. YOU ALSO PROTESTED THE DETERMINATION OF THE LUBBOCK, TEXAS, OFFICE OF THE SMALL BUSINESS ADMINISTRATION (SBA) THAT ABC IS A SMALL BUSINESS CONCERN TO BOTH THE SBA SIZE APPEALS BOARD AND TO OUR OFFICE.

WITH REGARD TO YOUR CONTENTION AS TO NOTICE REQUIREMENTS, ASPR 1 703(B)(5) PROVIDES AS FOLLOWS:

"(5) AWARD OF SET-ASIDE PROCUREMENTS. EXCEPT AS PROVIDED IN 3-508.1 OR WHEN THE CONTRACTING OFFICER DETERMINES IN WRITING THAT AWARD MUST BE MADE WITHOUT DELAY TO PROTECT THE PUBLIC INTEREST, AWARD WILL NOT BE MADE PRIOR TO FIVE WORKING DAYS AFTER (I) THE BID OPENING DATE FOR PROCUREMENTS PLACED THROUGH SMALL BUSINESS RESTRICTED ADVERTISING, OR (II) THE DEADLINE DATE FOR SUBMITTING A PROTEST SET FORTH IN THE NOTIFICATION TO THE APPARENTLY UNSUCCESSFUL OFFERORS) FOR SMALL BUSINESS SET-ASIDE PROCUREMENTS PLACED THROUGH CONVENTIONAL NEGOTIATION." THE PROCURING ACTIVITY REPORTS THAT THE REQUIREMENT OF ASPR 1-703(B)(5) FOR ADVANCE NOTICE TO APPARENTLY UNSUCCESSFUL OFFERORS OF INTENDED AWARD WAS INADVERTENTLY OVERLOOKED AND SUCH NOTICE WAS NOT GIVEN; HOWEVER, THE AWARDS MADE TO ABC WERE MADE IN GOOD FAITH AT FAIR AND REASONABLE PRICES AND A DETERMINATION WAS MADE BY THE COGNIZANT SBA OFFICE THAT ABC WAS A SMALL BUSINESS WITHIN THE APPLICABLE SIZE STANDARD. IT IS FURTHER STATED THAT STEPS HAVE BEEN TAKEN WITHIN THE PROCURING ACTIVITY TO INSURE FUTURE COMPLIANCE WITH APPLICABLE REGULATIONS GOVERNING PROPER NOTIFICATION OR WRITTEN DETERMINATIONS IN CASES OF THIS NATURE.

SINCE THE ADMINISTRATIVE FAILURE TO GIVE ADVANCE NOTICE TO YOUR FIRM WAS AN INADVERTENT OMISSION, WE CANNOT CONCLUDE THAT SUCH PROCEDURAL OMISSION PROVIDES A LEGAL BASIS FOR DISTURBING THE AWARDS MADE TO ABC.

WHILE YOU HAVE STATED THAT THE CONTRACT AWARD TO ABC UNDER RFP -4427 WAS IN THE AMOUNT OF $285,551 COMPARED WITH YOUR QUOTATION OF $279,609.40, WE FURNISHED YOUR ATTORNEY A COPY OF THE ADMINISTRATIVE REPORT SHOWING THAT THE TOTAL CONTRACT PRICE, TAKING INTO ACCOUNT DISCOUNTS OFFERED, WAS $271,273.45 AS OFFERED BY ABC, YOUR FIRM OFFERING A PRICE OF $276,813.31.

WITH RESPECT TO YOUR CONTENTION THAT ABC WAS NOT "SMALL BUSINESS," WE HAVE BEEN ADVISED BY THE SBA THAT BY LETTER DATED JULY 17, 1970, YOUR ATTORNEY WITHDREW THE APPEAL OF YOUR FIRM TO THE SIZE APPEALS BOARD OF THE SBA CHALLENGING THE SMALL BUSINESS SIZE STATUS OF ABC. THEREFORE, THE FINDING OF THE LUBBOCK, TEXAS, SBA OFFICE IS NOT ALTERED.

UNDER 15 U.S.C. 637(B)(6), A DECISION OF THE SBA REGARDING THE SIZE STATUS OF A PARTICULAR CONCERN IS CONCLUSIVE UPON THE PROCUREMENT AGENCY INVOLVED. 46 COMP. GEN. 898, 900 (1967); 44 ID. 271, 273 (1964). MOREOVER, AS WE STATED IN B-150757, APRIL 8, 1963: "NEITHER OUR OFFICE NOR ANY EXECUTIVE AGENCY OF THE GOVERNMENT MAY IGNORE A DETERMINATION BY SBA AS TO THE SIZE STATUS OF A PARTICULAR CONCERN." AMERICAN ELECTRIC COMPANY, LTD. V UNITED STATES, 270 F. SUPP. 689 (1967); SPRINGFIELD WHITE CASTLE COMPANY V FOLEY, 230 F. SUPP. 77 (1964). SEE, ALSO, MIDWEST CONSTRUCTION, LTD. V UNITED STATES, 387 F. 2D 957 (1967).

ACCORDINGLY, SINCE THE DECISION OF SBA REGARDING THE SIZE STATUS OF A COMPANY, BY STATUTE, IS "CONCLUSIVE," WE HAVE NO ALTERNATIVE BUT TO DENY YOUR PROTEST.