B-170224(2), OCT. 8, 1970

B-170224(2): Oct 8, 1970

Additional Materials:

Contact:

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

 

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

A MERE LISTING OF DELINQUENCIES WITHOUT SHOWING THE CAUSES OF THOSE DELINQUENCIES IS INSUFFICIENT TO SUPPORT THE DETERMINATION. TO GENERAL HEDLUND: HEREWITH IS A COPY OF OUR DECISION OF TODAY TO ALTON IRON WORKS. THIS PROTEST WAS THE SUBJECT OF A REPORT FROM THE ASSISTANT COUNSEL DATED JULY 31. THE CONTRACTING OFFICER'S DETERMINATION OF NONRESPONSIBILITY IS SUSTAINED PRIMARILY BECAUSE FROM EARLY 1969 ALTON HAD THE PERSONNEL AND EQUIPMENT NECESSARY TO REMEDY ITS DELINQUENCY PROBLEMS. IT WAS FURNISHED TO OUR OFFICE ONLY AFTER WE FOUND IT NECESSARY TO REQUEST ADDITIONAL INFORMATION. " WHICH ARE STATED AS REASONS FOR ASSESSING RESPONSIBILITY FOR LATE DELIVERIES AGAINST THE CONTRACTOR. AN ASSUMPTION THAT A PROSPECTIVE CONTRACTOR LACKS TENACITY AND PERSEVERANCE IS INSUFFICIENT.

B-170224(2), OCT. 8, 1970

BIDDER RESPONSIBILITY - LACK OF TENACITY AND PRESEVERANCE A DETERMINATION OF NONRESPONSIBILITY FOR LACK OF TENACITY AND PRESEVERANCE OF A BIDDER MUST BE CLEARLY DOCUMENTED, SO AS TO COMPLY WITH THE SUBSTANTIAL EVIDENCE RULE, A MERE LISTING OF DELINQUENCIES WITHOUT SHOWING THE CAUSES OF THOSE DELINQUENCIES IS INSUFFICIENT TO SUPPORT THE DETERMINATION.

TO GENERAL HEDLUND:

HEREWITH IS A COPY OF OUR DECISION OF TODAY TO ALTON IRON WORKS, INC., DENYING ITS PROTEST AGAINST AWARD OF A CONTRACT UNDER INVITATION FOR BIDS NO. DSA400-70-B-2831, ISSUED BY THE DEFENSE GENERAL SUPPLY CENTER. THIS PROTEST WAS THE SUBJECT OF A REPORT FROM THE ASSISTANT COUNSEL DATED JULY 31, 1970, AND AN INFORMAL SUBMITTAL OF DATA BY A COMMUNICATION DATED SEPTEMBER 14, 1970.

THE CONTRACTING OFFICER'S DETERMINATION OF NONRESPONSIBILITY IS SUSTAINED PRIMARILY BECAUSE FROM EARLY 1969 ALTON HAD THE PERSONNEL AND EQUIPMENT NECESSARY TO REMEDY ITS DELINQUENCY PROBLEMS, BUT HAD NOT DILIGENTLY UTILIZED ITS RESOURCES SINCE DELINQUENCIES IN SIGNIFICANT NUMBERS CONTINUED TO OCCUR. WHILE THIS INFORMATION CONSTITUTED "SUBSTANTIAL EVIDENCE" SUFFICIENT TO SUPPORT THE NONRESPONSIBILITY DETERMINATION OF THE CONTRACTING OFFICER, IT WAS FURNISHED TO OUR OFFICE ONLY AFTER WE FOUND IT NECESSARY TO REQUEST ADDITIONAL INFORMATION.

THE ORIGINAL REPORT CLEARLY ESTABLISHED THAT ALTON HAS AN EXTENSIVE HISTORY OF DELINQUENT PERFORMANCE. NOWHERE IN THE ORIGINAL REPORT DID WE FIND EVIDENCE THAT ALTON'S POOR PERFORMANCE RESULTED FROM A LACK OF TENACITY AND PERSEVERANCE. REPORT NOTATIONS SUCH AS "MANUFACTURING PROBLEM" OR "PRODUCTION PROBLEM," WHICH ARE STATED AS REASONS FOR ASSESSING RESPONSIBILITY FOR LATE DELIVERIES AGAINST THE CONTRACTOR, DO NOT CONSTITUTE ADEQUATE EVIDENCE OF LACK OF TENACITY AND PERSEVERANCE.

A DETERMINATION OF NONRESPONSIBILITY BASED ON LACK OF TENACITY OR PERSEVERANCE MUST BE SUPPORTED BY "SUBSTANTIAL EVIDENCE" AND SUCH EVIDENCE MUST BE DOCUMENTED IN THE CONTRACT FILES--AN ASSUMPTION THAT A PROSPECTIVE CONTRACTOR LACKS TENACITY AND PERSEVERANCE IS INSUFFICIENT. SEE PARAGRAPH 1-705.4(C)(VI) OF THE ARMED SERVICES PROCUREMENT REGULATION. B-168917, MARCH 18, 1970, 49 COMP. GEN. . AN UNSUPPORTED STATEMENT BY A CONTRACTING OFFICER TO THE SAME EFFECT IS EQUALLY INSUFFICIENT FOR PURPOSES OF MEETING THE EVIDENTIARY TEST REQUIRED. SEE 43 COMP. GEN. 298 (1963). IN THIS CIRCUMSTANCE, WE WOULD HAVE HAD NO HESITANCY IN CONCLUDING THAT THE CONTRACTING OFFICER'S DETERMINATION WAS NOT SUPPORTED BY "SUBSTANTIAL EVIDENCE," EXCEPT THAT OUR OFFICE REQUESTED AND RECEIVED AFTER RECEIPT OF THE ORIGINAL REPORT ADDITIONAL INFORMATION WHICH SUPPORTS THE DETERMINATION OF NONRESPONSIBILITY.

WE BELIEVE IT TO BE THE FUNCTION OF THE PROCUREMENT AGENCY TO AFFIRMATIVELY ESTABLISH ITS POSITION IN RESPONSE TO A PROTEST. IN A CASE OF A DETERMINATION OF NONRESPONSIBILITY FOR LACK OF TENACITY AND PERSEVERANCE, A MERE LISTING OF DELINQUENCIES WITHOUT SHOWING THE CAUSES FOR THOSE DELINQUENCIES IS INSUFFICIENT TO SUPPORT THE DETERMINATION. WHAT IS REQUIRED IS A CLEAR SHOWING THAT A PROSPECTIVE CONTRACTOR DID NOT DILIGENTLY OR AGGRESSIVELY TAKE WHATEVER ACTION WAS REASONABLY NECESSARY TO RESOLVE ITS PRODUCTION AND DELIVERY PROBLEMS.

WE HOPE THAT FUTURE REPORTS OF THIS NATURE WILL ADEQUATELY DOCUMENT THE BASIS FOR DETERMINATIONS OF NONRESPONSIBILITY DUE TO A LACK OF TENACITY AND PERSEVERANCE.