B-170130, SEP. 8, 1970

B-170130: Sep 8, 1970

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QUESTIONING ITS ABILITY TO PERFORM UNDER CONTRACT ON BASIS BID WAS BELOW GOVERNMENT ESTIMATE AND DID NOT POSSESS RESPONSIBILITY SINCE IT ONLY HAD THREE MONTHS EXPERIENCE IN THE FIELD. CONTRACTING OFFICER'S PREAWARD SURVEY FOUND NO MISTAKE IN BID PRICE AND THAT THE FIRM WAS CAPABLE OF PERFORMING IN ACCORDANCE WITH ASPR 2-407.2 THUS. THOUGH NEW IN BUSINESS HAS DEMONSTRATED TO THE SATISFACTION OF THE PROCUREMENT AGENCY THAT THE FIRM WILL PERFORM SATISFACTORY AND THE AWARD WILL NOT BE DISTURBED. TURNER: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 23 AND TO A COPY OF A LETTER OF JUNE 29. THE INVITATION UNDER WHICH THE AWARD WAS MADE REQUESTED BIDS FOR CUSTODIAL SERVICES AT THE NAVAL SUPPORT ACTIVITY.

B-170130, SEP. 8, 1970

BID PROTEST - QUALIFICATION - RESPONSIBILITY DENIAL OF PROTEST ON BEHALF OF GULF JANITORIAL SERVICES, INC., SECOND LOW BIDDER, AGAINST THE AWARD OF CONTRACT FOR CUSTODIAL SERVICES, TO GENERAL BUILDING SERVICES, INC., LOW BIDDER ISSUED BY NAVAL FACILITIES ENGINEERING COMMAND, CHARLESTON, S.C. SECOND LOW BIDDER PROTESTING AWARD TO LOW BIDDER, QUESTIONING ITS ABILITY TO PERFORM UNDER CONTRACT ON BASIS BID WAS BELOW GOVERNMENT ESTIMATE AND DID NOT POSSESS RESPONSIBILITY SINCE IT ONLY HAD THREE MONTHS EXPERIENCE IN THE FIELD. CONTRACTING OFFICER'S PREAWARD SURVEY FOUND NO MISTAKE IN BID PRICE AND THAT THE FIRM WAS CAPABLE OF PERFORMING IN ACCORDANCE WITH ASPR 2-407.2 THUS, THE FIRM, THOUGH NEW IN BUSINESS HAS DEMONSTRATED TO THE SATISFACTION OF THE PROCUREMENT AGENCY THAT THE FIRM WILL PERFORM SATISFACTORY AND THE AWARD WILL NOT BE DISTURBED.

TO MR. EMILE L. TURNER:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 23 AND TO A COPY OF A LETTER OF JUNE 29, 1970, TO THE DEPARTMENT OF THE NAVY, PROTESTING ON BEHALF OF GULF JANITORIAL SERVICES, INC., THE AWARD OF CONTRACT NO. N62467 -70-C-1021 TO GENERAL BUILDING SERVICES, INC. (GBS), BY THE NAVAL FACILITIES ENGINEERING COMMAND, CHARLESTON, SOUTH CAROLINA.

THE INVITATION UNDER WHICH THE AWARD WAS MADE REQUESTED BIDS FOR CUSTODIAL SERVICES AT THE NAVAL SUPPORT ACTIVITY, NEW ORLEANS, LOUISIANA. FOUR BIDS WERE RECEIVED AS FOLLOWS:

BIDDER AMOUNT OF BID

GENERAL BUILDING SERVICES $107,210

GULF JANITORIAL SERVICES 117,600

MASON, HANGAR, SILAS, MASON 135,196

NEW ORLEANS BUILDING MAINTENANCE 161,092

CONTRACT NO. N62467-70-C-1021 WAS AWARDED TO GBS AS THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER UNDER THE INVITATION. IT WAS DETERMINED, PURSUANT TO PARAGRAPH 2-407.8(B)(2) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR), THAT AWARD OF THIS CONTRACT COULD NOT AWAIT THE RESOLUTION OF YOUR PROTEST SINCE THE DELAY INCIDENT TO CONSIDERATION OF YOUR PROTEST WOULD HAVE RESULTED IN UNSANITARY WORKING CONDITIONS FOR GOVERNMENT PERSONNEL.

YOU MAINTAIN THAT THE GOVERNMENT IS WITHOUT REASONABLE BASIS FOR AN AWARD TO GBS BECAUSE:

"1. THEIR PRICE IS UNREASONABLY LOW: ASPR 2-404.2(E) PROVIDES THAT BIDS SHOULD BE REJECTED IF THEY ARE UNREASONABLE AS TO PRICE. A BID THAT IS MORE THAN $10,000.00 OFF OF THE GOVERNMENT'S ESTIMATE FOR A CERTAIN JOB, WHERE THAT FIGURE REPRESENTS A DIFFERENCE OF MORE THAN 10% FROM THE GOVERNMENT'S ESTIMATE AND THE NEXT LOWEST BID, IS PRIMA FACIE UNREASONABLE. THE JOB IN QUESTION IS ONE INVOLVING DETAILED SPECIFICATIONS AND NONTECHNICAL WORK; THEREFORE, THE EXPENSES LEND THEMSELVES TO ACCURATE PROGNOSIS. IN SUCH A SITUATION, TO BE LOWER THAN THE GOVERNMENT'S ESTIMATE AND THE NEXT LOWEST BID BY SUCH A LARGE PERCENTAGE IS TO BE UNREASONABLE AND REFLECTIVE OF INSUFFICIENT EXPERIENCE IN THE FIELD OF JANITORIAL WORK OR A MISTAKE IN BIDDING.

"2. THE LOW BIDDER IS NOT A RESPONSIBLE BIDDER: ASPR 2-404.2(G) PROVIDES THAT LOW BIDS FROM CONCERNS DETERMINED TO BE NOT RESPONSIBLE SHALL BE REJECTED. HERE THE ASPR PROVISION MAKES IT MANDATORY FOR THE CONTRACTING OFFICER TO REJECT SUCH A BIDDER (CF. ASPR 1-904.2). ASPR 1 902 EMPHASIZES THAT IT IS AN AFFIRMATIVE SHOWING OF RESPONSIBILITY ON THE PART OF THE BIDDER THAT IS REQUIRED, STATING THAT THE INFORMATION OBTAINED IN A PRE- AWARD SURVEY MUST 'INDICATE CLEARLY THAT THE PROSPECTIVE CONTRACTOR IS RESPONSIBLE.' HERE AWARD OF A CONTRACT OVER $100,000.00 IS BEING CONSIDERED TO A FIRM WITH LESS THAN THREE MONTHS EXPERIENCE IN THE FIELD, WITH LITTLE ABILITY TO ABSORB ANY LOSS OF RESOURCES OR MANPOWER, WITH NO RECORD OF PERFORMANCE TO SHOW AFFIRMATIVELY THEIR RESPONSIBILITY AND WITH A BID MORE THAN 10% OFF OF THE GOVERNMENT'S ESTIMATE AND THE NEXT LOWEST BID. FOR THE GOVERNMENT TO MAKE SUCH AN AWARD ESPECIALLY WITHOUT BENEFIT OF A PRE-AWARD SURVEY IS TO AWARD WITHOUT REASONABLE BASIS FOR DOING SO."

AN ANALYSIS OF THE BIDS RECEIVED REVEALS THAT TWO OF THE THREE RESPONSIVE BIDS WERE BELOW THE GOVERNMENT ESTIMATE OF $118,000 AND THAT THE LOW BID WAS ABOUT 9 PERCENT UNDER THAT ESTIMATE. WE ARE ADVISED THAT THE AMOUNT OF THE LOW BID IS NOT CONSIDERED UNUSUAL IN THE CIRCUMSTANCES AND IS NOT INDICATIVE OF A LACK OF EXPERIENCE. FURTHER, IN THE PROCESS OF PERFORMING THE NORMAL RESPONSIBILITY INVESTIGATION, GBS CONFIRMED THAT ITS PRICE WAS ACCURATE AND COMPLETE, AND SINCE NO ERROR IS CLAIMED OR APPARENT, IT HAS BEEN DETERMINED THAT THE BID OF GBS IS NOT UNREASONABLE AS TO PRICE. FURTHER, WE ARE AWARE OF NO LEGAL PRINCIPLE UPON WHICH AN AWARD MAY BE DISTURBED MERELY BECAUSE THE LOW BIDDER SUBMITTED A PRICE LESS THAN THE GOVERNMENT ESTIMATE. SINCE THE CONTRACTING OFFICER DETERMINED THAT THE LOW BID IS NOT UNREASONABLE AS TO PRICE, ASPR 2-404.2(E) IS INAPPLICABLE TO THIS SITUATION. SEE, IN THIS REGARD, B-149551, AUGUST 16, 1962; B- 150318, MARCH 25, 1963.

YOU STATE THAT THE SUCCESSFUL LOW BIDDER IS NOT A RESPONSIBLE BIDDER, CITING ASPR 2-404.2(G) WHICH PROVIDES THAT LOW BIDS FROM CONCERNS DETERMINED TO BE NOT RESPONSIBLE, PURSUANT TO ASPR 1-904, SHALL BE REJECTED. YOU OBSERVE THAT GBS IS A NEW FIRM WHICH IS NOT IN A POSITION TO AFFIRMATIVELY ESTABLISH ITS RESPONSIBILITY. CONTRARY TO YOUR UNDERSTANDING, A PREAWARD SURVEY OF GBS WAS CONDUCTED BY THE SOUTHERN DIVISION, NAVAL FACILITIES ENGINEERING COMMAND, WHICH RESULTED IN AN AFFIRMATIVE FINDING OF RESPONSIBILITY IN ACCORDANCE WITH ASPR 2 407.2. THE SURVEY REVEALED THAT GBS IS REGULARLY AND PRESENTLY ENGAGED IN PROVIDING JANITORIAL SERVICES. AN EXAMINATION OF THE CORPORATION AS A WHOLE REVEALED THAT IT POSSESSED THE REQUISITE EXPERIENCE AND RESPONSIBILITY TO PERFORM THE CONTRACT. WHILE THE FIRM IS RELATIVELY NEW IN BUSINESS, ITS PRINCIPALS ARE EXPERIENCED IN THE JANITORIAL BUSINESS AND HAVE DEMONSTRATED TO THE SATISFACTION OF THE PROCUREMENT AGENCY THAT THE FIRM WILL PERFORM SATISFACTORILY.

OUR OFFICE HAS CONSISTENTLY HELD THAT THE MATTER OF THE OVERALL RESPONSIBILITY OF THE SUCCESSFUL BIDDER TO PERFORM THE RESULTING CONTRACT IS PRIMARILY FOR DETERMINATION BY THE CONTRACTING OFFICER, WHOSE DECISION WILL NOT BE QUESTIONED UNLESS CLEARLY ARBITRARY OR WITHOUT ANY REASONABLE SUPPORT. WE FIND THAT THE RECORD SUPPORTS THE DETERMINATION OF GBS'S RESPONSIBILITY. 46 COMP. GEN. 371, 372 (1966).

FOR THE REASONS STATED, YOUR PROTEST IS DENIED.