B-171807, MAY 4, 1971

B-171807: May 4, 1971

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WHILE UNITED IS ALREADY PERFORMING A MAINTENANCE CONTRACT TO KEEP IN REPAIR APPROXIMATELY 820 FAMILY HOUSING BUILDINGS. BELIEVES THAT CONTRACT PROVISIONS PREVENT AN UNFAIR ADVANTAGE BY REQUIRING THAT EMPLOYEES UNDER THE MAINTENANCE CONTRACT (WHICH HAS NO PRESCRIBED MINIMUM LABOR RATES) WILL NOT PERFORM WORK ON THE INSTALLATION CONTRACT AT RATES LESS THAN PRESCRIBED IN THE LATTER. FINDS THAT UNITED HAD NO UNFAIR ADVANTAGE BECAUSE IT WAS NOT FURNISHED SPECIFICATIONS. ACCORDINGLY THE PROTEST IS DENIED. TO GREEN ELECTRIC: REFERENCE IS MADE TO YOUR LETTERS DATED JANUARY 27 AND MARCH 2. THE INVITATION FOR BIDS WAS ISSUED ON NOVEMBER 13. OPTION QUANTITIES WERE ALSO SET FORTH IN THE IFB FOR CONSIDERATION IN THE AWARD EVALUATION.

B-171807, MAY 4, 1971

BID PROTEST - CONTRACT HELD FOR SIMILAR WORK - UNFAIR ADVANTAGE DECISION DENYING PROTEST BY SECOND LOW BIDDER AGAINST AWARD OF CONTRACT TO UNITED SERVICE CORPORATION, LOW BIDDER, UNDER AN IFB ISSUED BY PATRICK AFB, FOR INSTALLATION OF GOVERNMENT FURNISHED HEAT PUMPS, REPOSITION OF OTHER HEAT PUMPS AND REPAIR OF CONDENSATE DRAINS. WHILE UNITED IS ALREADY PERFORMING A MAINTENANCE CONTRACT TO KEEP IN REPAIR APPROXIMATELY 820 FAMILY HOUSING BUILDINGS, INCLUDING REPAIR AND REPLACEMENT OF HEAT PUMPS THE COMP. GEN. BELIEVES THAT CONTRACT PROVISIONS PREVENT AN UNFAIR ADVANTAGE BY REQUIRING THAT EMPLOYEES UNDER THE MAINTENANCE CONTRACT (WHICH HAS NO PRESCRIBED MINIMUM LABOR RATES) WILL NOT PERFORM WORK ON THE INSTALLATION CONTRACT AT RATES LESS THAN PRESCRIBED IN THE LATTER. FURTHER THE COMP. GEN. FINDS THAT UNITED HAD NO UNFAIR ADVANTAGE BECAUSE IT WAS NOT FURNISHED SPECIFICATIONS, DRAWINGS, OR ANY OTHER INFORMATION PRIOR TO ISSUANCE OF THE INVITATION. ACCORDINGLY THE PROTEST IS DENIED.

TO GREEN ELECTRIC:

REFERENCE IS MADE TO YOUR LETTERS DATED JANUARY 27 AND MARCH 2, 1971, PROTESTING AN AWARD TO UNITED SERVICE CORPORATION, UNDER INVITATION FOR BIDS (IFB) F08650-71-B-0027, ISSUED BY PATRICK AIR FORCE BASE, FLORIDA.

THE INVITATION FOR BIDS WAS ISSUED ON NOVEMBER 13, 1970, FOR THE INSTALLATION OF 218 GOVERNMENT-FURNISHED HEAT PUMPS AND ASSOCIATED WORK NECESSARY FOR THESE INSTALLATIONS. IN ADDITION, THE IFB REQUIRED THE SUCCESSFUL BIDDER TO REPOSITION 20 EXISTING HEAT PUMPS AND REPAIR AN ESTIMATED 100 CONDENSATE DRAINS. OPTION QUANTITIES WERE ALSO SET FORTH IN THE IFB FOR CONSIDERATION IN THE AWARD EVALUATION. THE BASIC WORK IS TO BE COMPLETED WITHIN 160 CALENDAR DAYS AFTER RECEIPT OF NOTICE TO PROCEED. THE OPTION QUANTITY MUST BE EXERCISED WITHIN 150 DAYS AFTER THE NOTICE TO PROCEED, EXTENDING THE COMPLETION DATE TO 280 CALENDAR DAYS AFTER RECEIPT OF NOTICE TO PROCEED.

THE BIDS WERE OPENED ON DECEMBER 18, 1970, AND IT WAS DETERMINED THAT UNITED SERVICE CORPORATION (UNITED) WAS THE LOW RESPONSIVE AND RESPONSIBLE BIDDER AT $78,880.65 (INCLUDING OPTION) AND YOUR FIRM WAS NEXT LOW AT $115,552.44 (INCLUDING OPTION). AWARD WAS MADE TO UNITED ON JANUARY 25, 1971.

YOU POINT OUT THAT UNITED IS ALREADY PERFORMING A CONTRACT TO MAINTAIN AND KEEP IN REPAIR APPROXIMATELY 820 FAMILY HOUSING BUILDINGS AT PATRICK AIR FORCE BASE, INCLUDING REPAIR AND REPLACEMENT OF HEAT PUMPS. YOU CONTEND THAT UNITED COULD PERFORM THE WORK REQUIRED ON THE CONTRACT AT ISSUE, WHICH INCLUDES PREVAILING WAGE RATES REPRESENTING THE MINIMUM WHICH MAY BE PAID TO GIVEN CATEGORIES OF WORKMEN, UTILIZING LABOR HIRED FOR THE MAINTENANCE CONTRACT WHICH HAS NO PRESCRIBED MINIMUM LABOR RATES AND FOR WHICH ACTUAL LABOR RATES WOULD PRESUMABLY BE LOWER.

THE INSTALLATION CONTRACT PROVIDES FOR A DEFINITE NUMBER OF UNITS TO BE INSTALLED FOR A SPECIFIC NUMBER OF RESIDENCES. IF UNITED INSTALLS ANY HEAT PUMPS UNDER THE MAINTENANCE CONTRACT, IT MUST SET FORTH THE TIME OF INSTALLATION AND THE ADDRESS AT WHICH THE HEAT PUMP WAS INSTALLED. THE INSTALLATION CONTRACT ALSO REQUIRES THE CONTRACTOR TO POST A COPY OF THE APPLICABLE WAGE RATES AT THE SITE OF THE WORK IN A PROMINENT PLACE AND TO SUBMIT WEEKLY TO THE CONTRACTING OFFICER A COPY OF ALL PAYROLLS. ADDITION, THE CONTRACTING OFFICER HAS ACCESS TO ALL OF THE RECORDS OF THE CONTRACTOR WITH REGARD TO SUCH PAYMENT. IT MUST ALSO BE NOTED THAT SIGNIFICANT PENALTIES ARE PROVIDED IN THE CASE OF VIOLATION OF THESE PROVISIONS. WE BELIEVE THAT THESE REQUIREMENTS PROVIDE AN ADEQUATE BASIS FOR INSURING THAT EMPLOYEES UNDER THE MAINTENANCE CONTRACT WILL NOT PERFORM WORK ON THE INSTALLATION CONTRACT AT RATES LESS THAN PRESCRIBED IN THE LATTER.

YOU FURTHER CONTEND THAT THE STANDARD WORKMANSHIP GUARANTEE OF THE INSTALLATION CONTRACT MAY CONFLICT WITH THE EXISTING MAINTENANCE CONTRACT. UNDER THE APPROPRIATE "INSPECTION" PROVISION OF THE CONTRACT, THE GOVERNMENT CAN REQUIRE THE CONTRACTOR TO REPLACE WITHOUT CHARGE ANY MATERIAL OR CORRECT ANY WORKMANSHIP NOT IN CONFORMANCE WITH THE CONTRACT REQUIREMENTS. AGAIN, THIS IS A MATTER OF CONTRACT ADMINISTRATION TO MAKE SURE THAT ANY CORRECTION WORK UNDER THE INSTALLATION CONTRACT IS PERFORMED BY EMPLOYEES IN ACCORDANCE WITH THE TERMS OF THE INSTALLATION CONTRACT AND NOT UNDER THE TERMS OF THE MAINTENANCE CONTRACT. THE MAINTENANCE CONTRACT IS ALSO A FIRM FIXED PRICE CONTRACT (BUT WITH AN ESTIMATED AMOUNT FOR EMERGENCY PURCHASES OF MATERIALS AND SUPPLIES WHICH ARE NOT GOVERNMENT- FURNISHED). IT SHOULD BE NOTED THAT WHILE THE MAINTENANCE CONTRACT DOES INCLUDE A REQUIREMENT FOR REPLACEMENT OF AIR CONDITIONING UNITS, THE BIDDERS WERE ADVISED (PAGE 11 OF THE IFB) THAT REPLACEMENT OF SEVERAL HUNDRED NEW UNITS BY SEPARATE CONTRACT IN FISCAL YEAR 1970 WAS CONTEMPLATED.

YOU ALSO CLAIM THAT THE CONTRACTOR IS IN A POSITION TO UTILIZE VEHICLES, FACILITIES, SUPPLIES, EQUIPMENT, AND PERSONNEL IN PERFORMANCE OF THE WORK UNDER THE INSTALLATION CONTRACT FOR WHICH IT IS BEING REIMBURSED UNDER THE MAINTENANCE CONTRACT. THE MAINTENANCE CONTRACT HAS NO PROVISION FOR GOVERNMENT-FURNISHED VEHICLES. ALTHOUGH THE GOVERNMENT WILL FURNISH CERTAIN SUPPLIES AND MATERIALS TO THE CONTRACTOR UNDER THE MAINTENANCE CONTRACT, THE FURNISHING OF THESE SUPPLIES AND MATERIALS IS SUBJECT TO RIGID CONTROL AND ACCOUNTING BY THE ADMINISTRATIVE CONTRACTING OFFICER.

THE FACT THAT UNITED HAS NOT SUBMITTED A BID FOR VARIOUS OTHER PROJECTS AT PATRICK AIR FORCE BASE DOES NOT, IN OUR OPINION, INDICATE AS YOU IMPLY, THAT THERE WAS ANY IMPROPRIETY IN THE SUBMISSION OF ITS BID OR IN AWARD TO IT OF THE INSTALLATION CONTRACT.

THE AIR FORCE CONFIRMS THAT A RETIRED CIVIL SERVICE EMPLOYEE IS EMPLOYED BY THE CONTRACTOR. FURTHER, THIS MATTER WAS PREVIOUSLY INVESTIGATED BY THE AIR FORCE AND IT WAS DETERMINED THAT NO CONFLICT OF INTEREST WAS INVOLVED. WE SEE NO REASON TO QUESTION THIS DETERMINATION. WITH REGARD TO THE CONTENTION THAT UNITS WERE DELIVERED BY THE CONTRACTOR PRIOR TO ISSUANCE OF NOTICE TO PROCEED, CONTRARY TO THE CONTRACT, IT IS REPORTED THAT ONE UNIT WAS ISSUED AFTER NOTICE OF AWARD AND WAS LOADED, DELIVERED AND UNLOADED BY THE CONTRACTOR. THE CONTRACTOR REQUESTED ISSUANCE OF THIS UNIT FOR THE SOLE PURPOSE OF OBTAINING MEASUREMENTS FOR THE ACQUISITION OF INSTALLATION MATERIALS UNDER THE CONTRACT.

WITH REGARD TO YOUR CONTENTION THAT UNITED AS CONTRACTOR UNDER THE MAINTENANCE CONTRACT HAD AN UNFAIR ADVANTAGE, THE AIR FORCE POINTS OUT THAT THE INVITATION FOR THE INSTALLATION CONTRACT INVITED PROSPECTIVE BIDDERS TO VIEW THE UNITS AND VISIT THE SITE PRIOR TO BIDDING. FURTHER, IT IS REPORTED THAT THE CONTRACTOR WAS NOT FURNISHED SPECIFICATIONS, DRAWINGS, OR ANY OTHER INFORMATION PRIOR TO ISSUANCE OF THE INVITATION.

IN THESE CIRCUMSTANCES, WE SEE NO BASIS UPON WHICH OUR OFFICE MAY PROPERLY DISTURB THE CONTRACT AWARDED TO UNITED SERVICE CORPORATION.