B-170569, DEC. 15, 1970

B-170569: Dec 15, 1970

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CLAIMS THAT NO OTHER BIDDER HAS THE TECHNICAL OR MATERIAL CAPABILITY TO PERFORM BECAUSE THEY LACK REPAIR PARTS AND SPECIAL TOOLS NECESSARY FOR OVERHAUL OF THE ENGINES ARE CONTRADICTED BY THE RECORDS OF THE DIRECTORATE OF QUALITY AND FACILITIES AND BY JUDGMENT OF MARINE MAINTENANCE INSPECTORS. THREE PROPOSALS WERE RECEIVED. THE SECOND LOW OFFER WAS SUBMITTED BY YOUR COMPANY AND THE HIGH OFFER BY PLANNED SYSTEMS. YOUR PROTEST IS BASED UPON THE FOLLOWING TWO PREMISES: 1. THAT NEITHER SMITHCO NOR PSI HAS THE TECHNICAL OR MATERIAL CAPABILITY TO PERFORM UNDER THIS CONTRACT BECAUSE THEY HAVE NO REPAIR PARTS FOR THE 6V-53 DIESEL ENGINES IN STOCK. BECAUSE THEY DO NOT OWN OR HAVE ACCESS TO ALLEGED "SPECIAL" TOOLS FOR OVERHAULING THESE ENGINES.

B-170569, DEC. 15, 1970

BID PROTEST - BIDDER RESPONSIBILITY DENIAL OF PROTEST OF APPLIED TECHNICAL SERVICES, INC., AGAINST THE AWARD OF A CONTRACT FOR REPAIR OF 6V-53 DETROIT DIESEL ENGINES TO SMITHCO INTERNATIONAL, LOW OFFEROR, OR ANY OTHER BIDDER, ISSUED BY THE U.S. ARMY PROCUREMENT AGENCY, VIETNAM. CLAIMS THAT NO OTHER BIDDER HAS THE TECHNICAL OR MATERIAL CAPABILITY TO PERFORM BECAUSE THEY LACK REPAIR PARTS AND SPECIAL TOOLS NECESSARY FOR OVERHAUL OF THE ENGINES ARE CONTRADICTED BY THE RECORDS OF THE DIRECTORATE OF QUALITY AND FACILITIES AND BY JUDGMENT OF MARINE MAINTENANCE INSPECTORS. THEREFORE, PROTEST MUST BE DENIED.

TO APPLIED TECHNICAL SERVICES, INC.:

WE REFER TO YOUR TELEGRAM DATED AUGUST 11, 1970, AND SUPPLEMENTAL LETTER DATED AUGUST 20, 1970, WITH ENCLOSURES, PROTESTING AGAINST AWARD OF A CONTRACT TO ANY OTHER OFFEROR UNDER REQUEST FOR QUOTATIONS (RFQ) NO. DAJB11-71-R-0030, ISSUED BY THE UNITED STATES ARMY PROCUREMENT AGENCY VIETNAM (USAPAV).

THE RFQ, ISSUED ON MAY 11, 1970, REQUIRES THE REPAIR OF A QUANTITY OF 6V- 53 DETROIT MARINE DIESEL ENGINES IN ACCORDANCE WITH APPLICABLE SCHEDULES AND SPECIFICATIONS. THREE PROPOSALS WERE RECEIVED, THE LOW OFFER BEING THAT OF SMITHCO INTERNATIONAL (SMITHCO). THE SECOND LOW OFFER WAS SUBMITTED BY YOUR COMPANY AND THE HIGH OFFER BY PLANNED SYSTEMS, INCORPORATED (PSI).

ESSENTIALLY, YOUR PROTEST IS BASED UPON THE FOLLOWING TWO PREMISES:

1. THAT NEITHER SMITHCO NOR PSI HAS THE TECHNICAL OR MATERIAL CAPABILITY TO PERFORM UNDER THIS CONTRACT BECAUSE THEY HAVE NO REPAIR PARTS FOR THE 6V-53 DIESEL ENGINES IN STOCK; AND BECAUSE THEY DO NOT OWN OR HAVE ACCESS TO ALLEGED "SPECIAL" TOOLS FOR OVERHAULING THESE ENGINES, OR A DYNAMOMETER FOR TESTING THE ENGINES ONCE OVERHAULED.

2. THAT USAPAV DOES NOT HAVE TECHNICIANS QUALIFIED TO RENDER A COMPETENT OPINION ON THE CAPABILITY OF A CONTRACTOR TO PERFORM SUCCESSFULLY UNDER THE RFQ. IT IS YOUR CONTENTION, IN ADDITION TO THE ABOVE, THAT BOTH CONTRACTORS HAVE REQUESTED EXTENSIONS ON CONTRACTS IN THE PAST, WHICH DEMONSTRATES INABILITY TO MEET THE INSTANT REQUIRED DELIVERY SCHEDULE.

OUR OFFICE INFORMALLY FURNISHED A COPY OF THE ADMINISTRATIVE REPORT TO YOUR HEADQUARTERS IN ARVADA, COLORADO, FOR ANY COMMENTS YOU DESIRED TO MAKE FOR THE RECORD BEFORE THIS OFFICE.

IN ACCORDANCE WITH ASPR 2-407.8, THE CONTRACTING OFFICER SET FORTH HIS FINDINGS AND RECOMMENDATIONS IN RESPONSE TO THE ALLEGATIONS OF YOUR PROTEST AS FOLLOWS:

"THE RECORD OF THE DIRECTORATE OF QUALITY AND FACILITIES IN DISCHARGING ITS RESPONSIBILITIES IN A COMBAT ENVIRONMENT SPEAKS FOR ITSELF. IT IS THE CONSIDERED OPINION OF THAT DIRECTORATE, AN OPINION REVIEWED IN THE LIGHT OF COMMUNICATIONS RECEIVED FROM APPLIED TECHNICAL SERVICES, INC., AND UPHELD, THAT THE CONTRACTOR TO WHOM AWARD OF THIS CONTRACT HAS BEEN RECOMMENDED IS TECHNICALLY FULLY QUALIFIED TO SUCCESSFULLY PERFORM, IF A DYNAMOMETER IS AVAILABLE FOR FINAL TESTING OF THE ENGINES AFTER THEIR OVERHAUL IS COMPLETED. SUCH AN OPINION IS ALSO HELD WITH RELATION TO PSI. THE CONTRACTING OFFICER, HOWEVER, DID NOT CONSIDER THAT CONTRACTOR FOR AWARD, AS ITS BID WAS TOO HIGH.

"MARINE MAINTENANCE INSPECTORS FROM USMMAV DET 4, WHO MONITOR THE PERFORMANCE OF THESE CONTRACTORS, AND WHO ULTIMATELY PASS ON THE ADEQUACY OF THEIR WORK, HAVE NOT INDICATED DISSATISFACTION WITH THE QUALITY OF THE WORK PERFORMED. THEY HAVE, IN FACT, SUBMITTED A STATEMENT INDICATING THAT, IN THEIR OPINION, ALL THREE CONTRACTORS NAMED IN THE PROTEST ARE TECHNICALLY QUALIFIED AND ACCEPTABLE.

"THE CONTRACTING OFFICER CAN ONLY CONCLUDE THAT THE WORK HAS BEEN SATISFACTORY AND ACCORDING TO THE SPECIFICATIONS. THEREFORE, NO GROUNDS FOR DEEMING EITHER OF THE CONTRACTORS, AGAINST WHOM THIS PROTEST IS DIRECTED, AS TECHNICALLY UNQUALIFIED ARE APPARENT.

"THE CONTRACTING OFFICER HAS DETERMINED THAT THE 'SPECIAL' TOOLS WHICH ATS ALLEGES ARE SINE QUA NON FOR THE PERFORMANCE OF THIS CONTRACT ARE, IN FACT, A MERE CONVENIENCE. NEVERTHELESS, OUR INVESTIGATION HAS DISCLOSED THAT BOTH SMITHCO AND PLANNED SYSTEMS HAVE TOOLS IN SUFFICIENT QUANTITY, QUALITY AND VARIETY TO PERFORM UNDER THIS CONTRACT. PAST PERFORMANCE OF THESE CONTRACTORS FURTHER ATTESTS TO THIS FACT. AT NO TIME IN THE PAST, OR UNDER THE SPECIFICATIONS FOR THIS RFQ, HAS THE REQUIRING ACTIVITY INDICATED NEED FOR 'SPECIAL' TOOLS.

"SMITHCO'S DYNAMOMETER, WHICH IS REQUIRED FOR FINAL TESTING OF ENGINES TO BE OVERHAULED UNDER THE RFQ SHOULD BE IN COUNTRY IN TIME TO PERFORM ITS FUNCTION. THE PRE-AWARD SURVEY CONDUCTED BY THE DIRECTORATE OF QUALITY AND FACILITIES WAS CONDITIONED UPON THE AVAILABILITY OF SAID DYNAMOMETER. THE CONTRACTING OFFICER'S DETERMINATION OF RESPONSIBILITY IS BASED ON THE ASSUMPTION, SUPPORTED BY SUFFICIENT EVIDENCE, THAT THE DYNAMOMETER WILL BE AVAILABLE. IT IS STRESSED THAT SAID MACHINE IS REQUIRED FOR FINAL TESTING OF THE ENGINES, AFTER THEIR OVERHAUL HAS BEEN COMPLETED. PSI HAS DOCUMENTED ACCESS TO A DYNAMOMETER, AS SET FORTH IN THE PRE-AWARD SURVEY.

"THE RECORDS OF ALL MARINE MAINTENANCE CONTRACTORS HAVE BEEN REVIEWED. EACH OF THOSE CONTRACTORS HAS, AT ONE TIME OR ANOTHER, REQUESTED AND OBTAINED EXTENSIONS OF THE CONTRACT BECAUSE OF DIFFICULTY IN OBTAINING REPAIR PARTS. ATS HAS BEEN GRANTED TWO CONSECUTIVE EXTENSIONS ON A CURRENT MARINE MAINTENANCE CONTRACT BECAUSE OF THAT VERY REASON. EXTENSIONS HAVE BEEN GRANTED WITH RELATION TO THE CONTRACT FOR REPAIR OF LCM-8'S AS ALLEGED IN THE PROTEST. THERE APPEARS TO BE NO COGENT REASON FOR ASSUMING THAT ATS IS IN A POSITION WHICH PARTICULARLY FACILITATES PROCUREMENT OF REPAIR PARTS INASMUCH AS ALL SUCH PARTS ARE MANUFACTURED IN THE UNITED STATES."

WITH REGARD TO THE DETERMINATION OF THE RESPONSIBILITY OF A PROSPECTIVE CONTRACTOR, THE AUTHORITIES ARE IN AGREEMENT THAT THE OFFICERS IN WHOM THE POWER IS VESTED TO DETERMINE RESPONSIBILITY MUST DETERMINE THE FACTS AND SUCH DETERMINATION CANNOT BE SET ASIDE UNLESS THE ACTION WAS ARBITRARY, CAPRICIOUS OR FRAUDULENT. DETERMINATION OF THE LOWEST RESPONSIBLE BIDDER IS TO BE MADE BY THE AUTHORIZED OFFICIAL OF THE CONTRACTING AGENCY, WHO IS REQUIRED TO ACT FAIRLY UPON REASONABLE INFORMATION WHICH SUPPORTS THE DETERMINATION MADE. WHEN SUCH OFFICIAL DETERMINES THE RESPONSIBILITY OF A BIDDER, SUCH DETERMINATION CANNOT BE OVERTHROWN BY THE COURTS OR OUR OFFICE UNLESS IT CAN BE HELD THAT THE DETERMINATION WAS ARBITRARY, CAPRICIOUS OR FRAUDULENT. SEE MCQUILLIN, MUNICIPAL CORPORATIONS, 3D ED., VOL. 10, SEC. 29.73, AND THE CASES THEREIN CITED; 38 COMP. GEN. 131 (1958); 37 ID. 430, 435 (1957); BROWN V CITY OF PHOENIX, 272 P. 2D 358; MCNICHOLS V CITY AND COUNTY OF DENVER, 274 P. 2D 317.

FINALLY, WITH RESPECT TO YOUR ALLEGATION THAT THE USAPAV DOES NOT HAVE TECHNICIANS QUALIFIED TO RENDER COMPETENT OPINIONS ON THE CAPABILITY OF A CONTRACTOR, THE CONTRACTING OFFICER POINTS OUT THAT:

"THE DIRECTORATE OF QUALITY AND FACILITIES DOES NOT BASE ITS FINDINGS SOLELY UPON THE COMPETENT OPINIONS OF ITS IN-HOUSE TECHNICIANS, WHO, IT IS GRANTED, ARE NOT MARINE ENGINEERS. THE REQUIRING ACTIVITY, AND PARTICULARLY THE MARINE INSPECTORS OF THE UNITED STATES ARMY MARINE MAINTENANCE ACTIVITY, VIETNAM, PROVIDE AN ADDITIONAL SOURCE OF COMPETENT AND CAPABLE EXPERTISE AND INFORMATION WHICH IS TAPPED FOR THE PURPOSE OF PROVIDING THE CONTRACTING OFFICER WITH THE BEST AND MOST COMPLETE GUIDANCE AVAILABLE." WHILE YOU CHALLENGE THE COMPETENCY OF THE INDIVIDUALS AT THE USAPAV FACILITIES, YOU HAVE NOT SHOWN THAT THE PERSONS WHO CONDUCTED THE PRE-AWARD SURVEY OF SMITHCO WERE NOT QUALIFIED THROUGH EXPERIENCE OR ABILITY TO ANALYZE THE PRODUCTION CAPABILITIES OF THAT FIRM. ACCORDINGLY, WE SEE NO BASIS TO QUESTION THE CONTRACTING OFFICER'S RELIANCE ON THE RECOMMENDATION OF AWARD BY THOSE CONDUCTING THE PRE-AWARD SURVEY.

IN VIEW OF THE FOREGOING, YOUR PROTEST IS DENIED.