B-172866, DEC 29, 1971

B-172866, DEC 29, 1971

BID PROTEST - OFFEROR RESPONSIBILITY - WALSH-HEALEY ACT DECISION DENYING PROTEST OF POINT INDUSTRIES CORPORATION AGAINST AWARD OF A SMALL BUSINESS SET-ASIDE TO SCIENTIFIC MANAGEMENT ASSOCIATES UNDER AN RFQ ISSUED BY THE NAVAL TRAINING DEVICE CENTER, ORLANDO, FLA., FOR THE UPDATING OF ALTITUDE-TRAINING HANDBOOKS. PROTESTANT ALLEGES THAT SCIENTIFIC IS NOT A MANUFACTURER OF THE ITEMS TO BE PURCHASED. HOWEVER, A DECISION TO THE CONTRARY WAS MADE BY THE CONTRACTING OFFICER WITHIN THE MEANING OF THE WALSH-HEALEY ACT, 41 U.S.C. 35-45. THIS DETERMINATION WAS AFFIRMED IN A FINAL REVIEW BY THE DEPARTMENT OF LABOR. THEREFORE, THE COMP. GEN. IS WITHOUT JURISDICTION TO CONSIDER THE MATTER. IT IS FURTHER ALLEGED THAT SCIENTIFIC IS NOT A RESPONSIBLE OFFEROR. SINCE A DETERMINATION AS TO THE RESPONSIBILITY OF A CONTRACTOR IS PRIMARILY A FUNCTION OF THE PROCURING AGENCY, THE COMP. GEN. WILL NOT OBJECT WHERE THERE IS NO CLEAR EVIDENCE OF BAD FAITH OR LACK OF A REASONABLE BASIS FOR THE DETERMINATION AS MADE. ACCORDINGLY, THE PROTEST IS DENIED.

TO POINT INDUSTRIES CORPORATION:

REFERENCE IS MADE TO YOUR TELEGRAMS OF MAY 5 AND 6, 1971, AND YOUR LETTER DATED MAY 14, 1971, PROTESTING THE AWARD OF A CONTRACT TO ANY OTHER FIRM UNDER REQUEST FOR QUOTATIONS (RFQ) NO. N61339-71-Q-0022, ISSUED FEBRUARY 5, 1971, BY THE NAVAL TRAINING DEVICE CENTER, ORLANDO, FLORIDA.

THE RFQ SOUGHT PROPOSALS/QUOTATIONS FOR THE UPDATING OF HANDBOOKS PERTAINING TO TRAINING DEVICE 9A9, ALTITUDE-TRAINING, RAPID DECOMPRESSION CHAMBER, AND WAS SYNOPSIZED IN THE DECEMBER 8, 1970, ISSUE OF THE COMMERCE BUSINESS DAILY AS A 100 PERCENT SMALL BUSINESS SET-ASIDE.

PREDICATED UPON FINDINGS THAT IT WAS IMPOSSIBLE TO DRAFT ADEQUATE SPECIFICATIONS OR A DETAILED DESCRIPTION OF THIS PROJECT, IT WAS DETERMINED THAT THE SUBJECT PROCUREMENT WAS TO BE NEGOTIATED.

A PREPROPOSAL BIDDER'S CONFERENCE WAS CONDUCTED DURING THE WEEK OF JANUARY 11, 1971, TO ENABLE INTERESTED OFFERORS TO REVIEW THE ONLY AVAILABLE DATA PACKAGE LOCATED AT THE NAVAL TRAINING DEVICE CENTER. THE MAINTENANCE HANDBOOK, WHICH CONTAINED THE TYPE OF INFORMATION NECESSARY TO ESTIMATE THE MAN-HOURS OF EFFORT FOR THE PROCUREMENT WAS FURNISHED TO PROSPECTIVE OFFERORS DURING THE CONFERENCE. THE RECORD INDICATES THAT THE PROCURING ACTIVITY WAS AWARE OF UNOFFICIAL PLANNED MAINTENANCE SYSTEM (PMS) PUBLICATIONS AT THE EQUIPMENT SITES, BUT THOSE PUBLICATIONS WERE NOT FURNISHED THE PROSPECTIVE OFFERORS AS BIDDING MATERIAL SINCE THEY WERE CONSIDERED TO BE INCOMPLETE, INACCURATE, AND THEREFORE MISLEADING.

THE SOLICITATION SPECIFIED A DEADLINE OF MARCH 5, 1971, FOR THE SUBMISSION OF PROPOSALS/QUOTATIONS, AND THE OPENING THEREOF REVEALED THE RECEIPT OF PROPOSALS/QUOTATIONS FROM THIRTEEN (13) FIRMS, WITH SCIENTIFIC MANAGEMENT ASSOCIATES (SCIENTIFIC) BEING THE LOW OFFEROR.

A TECHNICAL EVALUATION WAS MADE OF THE SIX PROPOSALS/QUOTATIONS OFFERING THE LOWEST PRICE AND LABOR REQUIREMENTS, AND IT WAS DETERMINED INITIALLY THAT ALL EXCEPT SCIENTIFIC'S PROPOSAL WERE TECHNICALLY ACCEPTABLE. SCIENTIFIC'S PROPOSAL WAS CONSIDERED TECHNICALLY INADEQUATE DUE TO AN INSUFFICIENT NUMBER OF TOTAL PAGES.

IN VIEW THEREOF, A CLARIFICATION CONFERENCE WAS CONDUCTED WITH REPRESENTATIVES OF SCIENTIFIC WHO SUBSEQUENTLY REVISED THE PAGE COUNT UPWARD TO A LEVEL OF TECHNICAL ACCEPTABILITY, ALTHOUGH SCIENTIFIC'S ESTIMATE OF MAN-HOURS FOR THE WORK WAS CONSIDERED TO BE LOW. AFTER IT WAS DETERMINED THAT SCIENTIFIC'S PROPOSAL SHOULD NOT BE CONSIDERED TECHNICALLY UNACCEPTABLE BECAUSE OF THE LOW ESTIMATE FOR THE MAN-HOURS BELIEVED NECESSARY TO DO THE WORK, THE PROJECT ENGINEER RECOMMENDED THAT AWARD BE MADE TO THE LOW OFFEROR.

YOUR PROTEST IS PREDICATED UPON THE GROUND THAT SCIENTIFIC IS NOT A RESPONSIBLE OFFEROR FOR ESSENTIALLY TWO REASONS:

1) SCIENTIFIC IS NOT AN ESTABLISHED OR REGULAR DEALER-MANUFACTURER OF THE ITEMS TO BE PURCHASED, AS REQUIRED BY THE WALSH-HEALEY ACT, AND IS THEREFORE INELIGIBLE TO RECEIVE AN AWARD UNDER THIS SOLICITATION.

2) YOUR QUOTATION WAS ESTIMATED ON THE BASIS OF THE KNOWN AVAILABILITY OF THE UNOFFICIAL PMS PUBLICATIONS WHICH THE EQUIPMENT SITES HAD GENERATED FOR THEIR OWN USE. YOU SAY THESE PUBLICATIONS INCLUDED THE NECESSARY BASIC TECHNICAL CONTENT, AND NEEDED ONLY FORMATING TO THE SPECIFICATIONS LISTED IN THE RFQ. YOU CONTEND THAT OTHER OFFERORS, NOT HAVING TAKEN THE INITIATIVE TO DISCOVER THE AVAILABILITY OF THE UNOFFICIAL PUBLICATIONS, WOULD HAVE TO INCLUDE IN THEIR QUOTATIONS APPROXIMATELY $4,000 MORE THAN YOU DID TO COVER THE COST OF PERFORMING THE WORK WITHOUT THE BENEFITS WHICH YOU CONTEMPLATED FROM USE OF THE UNOFFICIAL MATERIAL. YOU THEREFORE BELIEVE YOUR TOTAL PRICE SHOULD OBVIOUSLY BE LOWER THAN THE PRICE OF ANY OTHER RESPONSIBLE OFFEROR.

WITH REFERENCE TO YOUR CONTENTION THAT SCIENTIFIC IS NOT A REGULAR DEALER -MANUFACTURER OF THE ITEMS TO BE PURCHASED, THE RECORD INDICATES THAT THE CONTRACTING OFFICER, WHO IS DIRECTED TO RENDER THE INITIAL DETERMINATION OF ELIGIBILITY UNDER ARMED SERVICES PROCUREMENT REGULATION (ASPR) 12- 604(A)(3), DETERMINED THAT SCIENTIFIC WAS, IN FACT, A MANUFACTURER OF THE SUPPLIES BEING PROCURED WITHIN THE MEANING OF THE WALSH-HEALEY ACT, 41 U.S.C. 35-45. CONSEQUENTLY, AND PURSUANT TO THAT SAME SECTION OF ASPR, THE CONTRACTING OFFICER'S DETERMINATION WAS THEN REFERRED TO THE DEPARTMENT OF LABOR FOR REVIEW, AND BY LETTER DATED SEPTEMBER 2, 1971, THAT AGENCY AFFIRMED THE CONTRACTING OFFICER'S INITIAL DETERMINATION. SUCH A DETERMINATION, HAVING UNDERGONE REVIEW BY THE DEPARTMENT OF LABOR, IS FINAL AND OUR OFFICE IS WITHOUT JURISDICTION TO CONSIDER THE MATTER. -167004, JULY 9, 1969.

WITH REGARD TO THE BASES FOR YOUR CONTENTION THAT SCIENTIFIC IS NOT A RESPONSIBLE OFFEROR THE RECORD SETS FORTH SEVERAL GERMANE FACTORS.

AS INDICATED ABOVE, THE UNOFFICIAL PMS PUBLICATIONS WERE NOT FURNISHED TO PROSPECTIVE OFFERORS AS BIDDING MATERIAL BECAUSE THEY WERE INCOMPLETE, INACCURATE AND MISLEADING. THE CONTRACTING OFFICER REPORTS THAT YOUR ASSUMPTION THAT THE UNOFFICIAL PMS PUBLICATIONS REQUIRED VERY LITTLE UPDATING WAS ERRONEOUS AND, AS A RESULT, YOU UNDERESTIMATED THE MAN-HOURS NEEDED FOR THAT PORTION OF THE EFFORT. EVEN IF YOUR KNOWLEDGE OF THE AVAILABILITY OF SUCH MATERIAL ALLOWED YOU TO COMPUTE A PRICE FOR THAT SMALL PORTION OF THE WORK WHICH MAY HAVE BEEN LOWER THAN THE PRICES COMPUTED BY OTHER OFFERORS FOR SUCH PORTION OF THE WORK, WE CANNOT AGREE WITH YOUR CONTENTION THAT SUCH PRICING MUST NECESSARILY RESULT IN A LOWER TOTAL PRICE BY YOUR FIRM THAN ANY TOTAL PRICE WHICH COULD BE OFFERED BY ANOTHER RESPONSIBLE OFFEROR FOR THE COMPLETE PROJECT.

WHILE THE RECORD INDICATES THAT SCIENTIFIC'S PAGE COUNT, AS REVISED, IS TECHNICALLY ACCEPTABLE, THAT FIRM'S ESTIMATE OF THE MAN-HOURS REQUIRED TO MEET THE SPECIFICATION REQUIREMENTS IS STILL CONSIDERED TO BE VERY LOW. ALTHOUGH THE MAN-HOURS ESTIMATED IN SCIENTIFIC'S PROPOSAL ARE LOWER THAN THE GOVERNMENT'S ESTIMATE, SUCH FACTOR ALONE DOES NOT REQUIRE A FINDING THAT THE FIRM IS NONRESPONSIBLE. HERE, THE PROCUREMENT IS FOR A PRODUCT AND THE CONTRACTOR WILL BE REQUIRED TO FURNISH THE PRODUCT IN ACCORDANCE WITH THE SPECIFICATIONS AT ITS QUOTED PRICE, IRRESPECTIVE OF WHETHER COMPLIANCE WITH THE SPECIFICATIONS ACTUALLY REQUIRES MORE MAN-HOURS THAN ANTICIPATED BY THE CONTRACTOR. THE GENERAL STANDARDS FOR DETERMINING WHETHER THE LOW OFFEROR MAY RECEIVE THE AWARD AS A RESPONSIBLE PROSPECTIVE CONTRACTOR ARE SET OUT IN ASPR 1-903.1, AND CONCERN THE CONTRACTOR'S FINANCIAL RESOURCES; ABILITY TO COMPLY WITH THE DELIVERY SCHEDULE; RECORDS OF PERFORMANCE AND INTEGRITY; AND BEING OTHERWISE ELIGIBLE FOR THE AWARD UNDER APPLICABLE LAWS AND REGULATIONS. THERE IS NOTHING IN THESE STANDARDS OR THE RFQ PROVISIONS WHICH DICTATE THAT THE CONTRACTOR'S ESTIMATE AS TO THE AMOUNT OF LABOR REQUIRED TO PERFORM THE CONTRACT MUST CONFORM TO THE GOVERNMENT'S ESTIMATE IN ORDER TO BE A RESPONSIBLE PROSPECTIVE CONTRACTOR FOR THE PROCUREMENT CONCERNED.

THE RECORD INDICATES THAT SCIENTIFIC HAS PRESENTLY 25 CONTRACTS WITH THE GOVERNMENT AND THAT PERFORMANCE THEREON IS APPARENTLY SATISFACTORY. ADDITION, WHILE SCIENTIFIC IS FULLY AWARE THAT ITS ESTIMATE AS TO THE MAN- HOURS REQUIRED FOR THE EFFORT IS LOWER THAN THE GOVERNMENT'S ESTIMATE, THAT FIRM MAINTAINS THAT IT WILL PERFORM THE TASK AT THE PRICE QUOTED, NOTWITHSTANDING THAT IT MAY BE REQUIRED TO PERFORM AT A LOSS ON THIS CONTEMPLATED FIRM FIXED PRICE CONTRACT. IN THIS CONNECTION, OUR DECISIONS HAVE HELD THAT A CONTRACTOR MAY NOT BE DENIED THE AWARD MERELY BECAUSE HE HAS SUBMITTED AN UNPROFITABLE PRICE. B-170228, SEPTEMBER 22, 1970; B- 169465, JUNE 19, 1970.

THE DETERMINATION AS TO THE RESPONSIBILITY OF A PROPOSED CONTRACTOR IS PRIMARILY THE FUNCTION OF THE PROCUREMENT AGENCY AND, UNLESS THERE IS CONVINCING EVIDENCE OF BAD FAITH OR LACK OF A REASONABLE BASIS FOR THE DETERMINATION AS MADE, NEITHER OF WHICH IS PRESENT IN THIS CASE, OUR OFFICE WILL NOT OBJECT TO SUCH A DETERMINATION. 37 COMP. GEN. 798, 800 (1958).

IN HOLDING THAT THE AWARD SHOULD BE MADE TO SCIENTIFIC, THE CONTRACTING OFFICER HAS CONCLUDED THAT SUCH FIRM (1) HAS SUBMITTED A TECHNICALLY ACCEPTABLE AND RESPONSIVE PROPOSAL TO THE SOLICITATION; (2) IS A RESPONSIBLE OFFEROR; (3) QUALIFIES AS A SMALL BUSINESS; (4) IS A MANUFACTURER OF THE PRODUCTS BEING PROCURED; AND (5) HAS SUBMITTED THE LOWEST PRICE. THE RECORD DOES NOT AFFORD THIS OFFICE ANY BASIS FOR OBJECTING TO THOSE CONCLUSIONS OR TO THE CONTRACTING OFFICER'S POSITION THAT THE AWARD SHOULD BE MADE TO SCIENTIFIC.

ACCORDINGLY, YOUR PROTEST AGAINST THE PROPOSED AWARD TO SCIENTIFIC, THE LOW OFFEROR WHICH THE CONTRACTING OFFICER HAS FOUND TO BE A RESPONSIBLE PROSPECTIVE CONTRACTOR, MUST BE DENIED.