B-173855, OCT 26, 1971, 51 COMP GEN 242

B-173855: Oct 26, 1971

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INFORMATION REQUIRED UNDER AN INVITATION FOR BIDS TO FURNISH SERVICE CAPS THAT WAS RESTRICTED TO SMALL BUSINESS FIRMS ON THE QUALIFIED MANUFACTURERS LIST (QML) FOR THE ITEM PRIOR TO BID OPENING. MAY NOT BE CORRECTED OR WAIVED AS A MINOR DEVIATION AS THE INFORMATION IS MATERIAL TO MAINTAINING THE QML PROCEDURES ESTABLISHED FOR THE PROCUREMENT OF MILITARY CLOTHING IN ORDER TO PERMIT PROMPT DETERMINATION THAT A BIDDER IS AN ESTABLISHED AND REPUTABLE MANUFACTURER WITH SUFFICIENT CAPACITY AND CREDIT TO PERFORM THE CONTRACT AND TO PREVENT A FIRM FROM HAVING THE OPTION OF DECIDING AFTER BID OPENING WHETHER OR NOT TO MAKE ITS OFFER RESPONSIVE BY NAMING A FACILITY THAT HAD BEEN QUALIFIED BY THE QML PRIOR TO BID OPENING.

B-173855, OCT 26, 1971, 51 COMP GEN 242

BIDDERS - QUALIFICATIONS - GEOGRAPHICAL LOCATION REQUIREMENT THE FAILURE OF THE LOW BIDDER TO STATE THE EXACT PLACE OF CONTRACT PERFORMANCE, INFORMATION REQUIRED UNDER AN INVITATION FOR BIDS TO FURNISH SERVICE CAPS THAT WAS RESTRICTED TO SMALL BUSINESS FIRMS ON THE QUALIFIED MANUFACTURERS LIST (QML) FOR THE ITEM PRIOR TO BID OPENING, MAY NOT BE CORRECTED OR WAIVED AS A MINOR DEVIATION AS THE INFORMATION IS MATERIAL TO MAINTAINING THE QML PROCEDURES ESTABLISHED FOR THE PROCUREMENT OF MILITARY CLOTHING IN ORDER TO PERMIT PROMPT DETERMINATION THAT A BIDDER IS AN ESTABLISHED AND REPUTABLE MANUFACTURER WITH SUFFICIENT CAPACITY AND CREDIT TO PERFORM THE CONTRACT AND TO PREVENT A FIRM FROM HAVING THE OPTION OF DECIDING AFTER BID OPENING WHETHER OR NOT TO MAKE ITS OFFER RESPONSIVE BY NAMING A FACILITY THAT HAD BEEN QUALIFIED BY THE QML PRIOR TO BID OPENING.

TO STASSEN AND KOSTOS, OCTOBER 26, 1971:

REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 23, 1971, WITH ENCLOSURES, PROTESTING ON BEHALF OF ART CAP COMPANY, INCORPORATED, THE AWARD OF A CONTRACT TO A HIGHER BIDDER UNDER INVITATION FOR BIDS NO. DSA100-71-B- 1410, ISSUED BY THE DEFENSE PERSONNEL SUPPORT CENTER (DPSC), PHILADELPHIA, PENNSYLVANIA.

THE SOLICITATION REQUESTED BIDS FOR A QUANTITY OF FRAME SERVICE CAPS, AND WAS EXPRESSLY RESTRICTED TO SMALL BUSINESS FIRMS ON THE QUALIFIED MANUFACTURERS LIST (QML) FOR THE ITEM PRIOR TO BID OPENING. THE INVITATION REQUIRED BIDDERS TO STATE THE EXACT PLACE OF PERFORMANCE IN THEIR BIDS, AND PROVIDED THAT AN OFFER, OTHERWISE ACCEPTABLE, WOULD BE CONSIDERED NONRESPONSIVE IF THE OFFER FAILED TO LIST THE PLACE OF PERFORMANCE (CLAUSES B10.70 AND B16.80). YOUR LOW BID WAS REJECTED FOR FAILURE TO LIST THE PLACE OF PERFORMANCE.

IN YOUR LETTER TO US YOU RECOGNIZED THE EXISTENCE OF SIMILARITIES BETWEEN THE PRESENT CIRCUMSTANCES AND THOSE WHICH FACED OUR OFFICE IN B 167974, NOVEMBER 14, 1969. IN THAT CASE A SOLICITATION ISSUED BY DPSC REQUESTED BIDS FOR A QUANTITY OF ALUMINIZED ASBESTOS FIREFIGHTER COATS AND WAS EXPRESSLY RESTRICTED TO SMALL BUSINESS FIRMS ON THE QML FOR THE ITEMS PRIOR TO BID OPENING. THE INVITATION REQUIRED BIDDERS TO STATE THE EXACT PLACE OF PERFORMANCE IN THEIR BIDS AND PROVIDED THAT AN OFFER, OTHERWISE ACCEPTABLE, WOULD BE CONSIDERED NONRESPONSIVE IF THE OFFER FAILS TO LIST THE PLACE OF PERFORMANCE. THE PROTESTOR'S LOW BID WAS REJECTED FOR FAILURE TO LIST THE PLACE OF PERFORMANCE. THE PROTESTOR HAD CONTENDED THAT SINCE IT HAD BEEN A SUPPLIER TO DPSC ON APPROXIMATELY 150 PRIOR CONTRACTS, ALL OF WHICH WERE BID FOR AT ITS FACILITY AT MILWAUKEE, WHICH WAS ON THE QML FOR THE ITEM, THE FAILURE TO LIST THE PLANT LOCATION SHOULD HAVE BEEN CONSIDERED AN INADVERTENT ERROR WHICH SHOULD HAVE BEEN WAIVED OR CORRECTED. WE RESPONDED TO THIS ARGUMENT, IN PART, AS FOLLOWS:

*** THE REQUIREMENT THAT BIDDERS LIST THE SPECIFIC FACILITY WHICH WILL BE UTILIZED IN THE PERFORMANCE OF THE CONTRACT IS TO OBTAIN A BINDING CONTRACTUAL COMMITMENT FOR COMPLIANCE WITH THE ESSENTIAL PROVISION THAT THE ITEM WILL BE MANUFACTURED IN AN APPROVED FACILITY. IN THE ABSENCE OF SUCH A LISTING A BIDDER COULD NOT BE REQUIRED UPON AWARD TO MANUFACTURE THE ITEMS IN A FACILITY WHICH HAS BEEN APPROVED PRIOR TO BID OPENING. THIS IS THE CASE NOTWITHSTANDING THE NUMBER OF PRIOR CONTRACTS YOU HAVE HAD WITH THE PROCUREMENT ACTIVITY UTILIZING YOUR FACILITY AT MILWAUKEE. THE REQUIREMENT FOR LISTING OF THE MANUFACTURING FACILITY MUST THEREFORE BE CONSIDERED A MATERIAL REQUIREMENT OF THE INVITATION FOR BIDS.

UNDER FORMAL ADVERTISING PROCEDURES FOR GOVERNMENT CONTRACTS, IT IS AN ESTABLISHED RULE THAT A BID, TO BE ACCEPTABLE, MUST CONFORM TO ALL MATERIAL REQUIREMENTS OF THE ADVERTISED TERMS AND SPECIFICATIONS. IF, DUE TO A MISTAKE, A BID RESULTS IN A MATERIAL DEVIATION FROM THE ADVERTISED REQUIREMENTS, SUCH A BID IS NONRESPONSIVE AND CANNOT UNDER ANY CIRCUMSTANCES BE CORRECTED SO AS TO MAKE IT RESPONSIVE TO THE INVITATION AND THUS ELIGIBLE FOR AWARD. 40 COMP. GEN. 432 (1961).

SINCE THE DISCREPANCY IN THE PROTESTOR'S BID HAD, THEREFORE, RESULTED IN A MATERIAL DEVIATION FROM THE ADVERTISED REQUIREMENTS, THE DEVIATION COULD NOT BE CORRECTED OR WAIVED AND ACCORDINGLY THE PROTEST WAS DENIED.

YOU HAVE ATTEMPTED TO DISTINGUISH B-167974 FROM THE INSTANT CASE BY EMPHASIZING THE FOLLOWING: THAT ART CAP IS AN APPROVED QML FACILITY WHICH IS LOCATED AT 599 BROADWAY, NEW YORK, NEW YORK; THAT THIS IS THE ONLY FACILITY USED BY ART CAP; THAT THIS ADDRESS IS INDICATED ON PAGE 7 OF THE SOLICITATION IN THE BLOCK ON THE TOP OF THE PAGE ENTITLED "NAME OF OFFEROR OR CONTRACTOR," AND FURTHER THAT TWO PREAWARD SURVEYS HAVE BEEN CONDUCTED AT THE ART CAP ADDRESS AT 599 BROADWAY ON THIS PROCUREMENT, WHICH SHOULD BE ACCEPTED AS CONCLUSIVE PROOF THAT THE CONTRACTING OFFICER HAD INTERPRETED ART CAP'S BID AS CLEARLY MANIFESTING AN INTENTION THAT ITS PLACE OF PERFORMANCE WAS 599 BROADWAY.

THE FACT THAT ART CAP INDICATED ITS ADDRESS IN THE BLOCK CALLING FOR THE NAME OF THE OFFEROR OR CONTRACTOR DOES NOT REQUIRE AN INTERPRETATION THAT THIS REPRESENTS ITS PLACE OF PERFORMANCE FOR THE SUBJECT CONTRACT. ART CAP USED THE SAME ADDRESS STAMP IN THE SAME BLOCK ON EVERY OTHER PAGE OF THE SOLICITATION WHERE THE BLOCK APPEARS. IT IS SIGNIFICANT TO NOTE THAT THERE IS NO STAMP WHATSOEVER ON PAGE 6 OF THE SOLICITATION WHICH SETS FORTH THE PLACE OF PERFORMANCE CLAUSE AND IS THE PROPER PLACE WHERE THE PLANT LOCATION SHOULD HAVE BEEN SHOWN. THE FACT THAT THE ADDRESS IS INDICATED IN AN AREA OF THE SOLICITATION WHICH HAPPENS TO BE CONTIGUOUS TO THE QML PROVISIONS DOES NOT SERVE AS AN ACCEPTABLE SUBSTITUTE FOR SHOWING THE PLACE OF PERFORMANCE WHERE EXPLICITLY CALLED FOR ON PAGE 6 OF THE SOLICITATION. THE PROPER INTERPRETATION AS TO WHAT THE ADDRESS STAMPED ON PAGE 7 PERTAINS IS THAT IT MUST APPLY TO THE BLOCK IN WHICH IT WAS PLACED AND NOT TO A DISTINCTLY SEPARATE PROVISION WHICH COINCIDENTALLY IS LOCATED CONTIGUOUS TO THE BLOCK IN WHICH IT HAS BEEN PLACED. THE CONTRACTING OFFICER HAS CORRECTLY DRAWN THIS CONCLUSION. IT IS WELL KNOWN THAT THE ADDRESS OF THE BIDDER IS NOT NECESSARILY THE PLACE OF PERFORMANCE. THEREFORE, AS WE HAVE INDICATED IN THE ABOVE-QUOTED PORTION OF B 167974, THE FACT THAT ART CAP STAMPED AN ADDRESS IN THE BLOCK CALLING MERELY FOR THE NAME OF THE OFFEROR OR CONTRACTOR IS NOT SUFFICIENT TO SHOW THAT THIS IS A BINDING COMMITMENT TO PERFORM AT THIS ADDRESS.

YOU FURTHER CONTEND THAT THE PROVISIONS OF THE IFB ARE CONFUSING. SPECIFICALLY, YOU ALLEGE THAT CLAUSE B10.70 INDICATES THAT IF THE BIDDER DOES NOT INCLUDE THE PLACE OF PERFORMANCE THAT THE PLACE OF PERFORMANCE WILL THEN BE CONSIDERED THAT FACILITY WHICH THE BIDDER HAS LEASED OR OWNS AT THE TIME OF OPENING. PARAGRAPH 1 OF CLAUSE B10.70 IS REPRODUCED BELOW:

CLAUSE B10.70 PLACE OF PERFORMANCE (DPSC 1969 MAY)

1. OFFERORS MUST STIPULATE BELOW THE PLANTS) WHERE THE WORK IS TO BE PERFORMED, INDICATING THE EXACT ADDRESSES) (STREET, CITY, COUNTY, STATE) THEREOF, NAMES) AND ADDRESSES) OF THE OWNERS) AND OPERATORS), THE OPERATION TO BE PERFORMED AT SUCH PLANTS) AND THE QUANTITY OF ITEMS TO BE MANUFACTURED AT EACH PLANT. FAILURE TO SHOW THE ABOVE IN THE OFFER, OR THE INDICATING OF ALTERNATE PLACES) OF PERFORMANCE WILL RENDER THE OFFER NONRESPONSIVE, IF AT THE TIME OF OPENING/CLOSING THE OFFEROR DOES NOT OWN OR LEASE THE PLANTS) WHERE THE WORK IS TO BE PERFORMED. IF THE PROCUREMENT IS FOR AN ITEM RESTRICTING A PROCUREMENT TO THE QUALIFIED MANUFACTURERS' LIST OR LABOR SURPLUS AREA SOURCES, THE PRECEDING SENTENCE IS NOT APPLICABLE, SINCE ON THESE PROCUREMENTS, OFFERS ARE NON-RESPONSIVE UNLESS PLACES OF PERFORMANCE ARE FURNISHED.

IT CAN BE CLEARLY SEEN THAT THE SENTENCE WHICH APPARENTLY SERVES AS THE BASIS FOR YOUR ALLEGATION IS CONCLUSIVELY NEGATED BY THE IMMEDIATELY SUCCEEDING SENTENCE IN THE PARAGRAPH. THIS SENTENCE MAKES CLEAR THAT WHEN, AS HERE, THE SOLICITATION IS FOR AN ITEM RESTRICTING THE PROCUREMENT TO THE QML, THE CONSTRUCTION WHICH MIGHT OTHERWISE BE APPLIED WHEN THE OFFEROR OWNS OR LEASES THE PLANT WHERE THE WORK IS TO BE PERFORMED BUT FAILS TO AFFIRMATIVELY INDICATE THE PLACE OF PERFORMANCE, CANNOT BE APPLIED.

FURTHERMORE, IN ORDER TO EFFECTIVELY ALLEVIATE ANY DOUBT THAT MIGHT, HOWEVER UNLIKELY, REMAIN AS TO WHETHER A MANDATORY REQUIREMENT EXISTS FOR PROVIDING THE PLACE OF PERFORMANCE, A CAUTION NOTICE WAS PROVIDED. THIS NOTICE, WHICH WAS PART OF THE FIRST SHEET ATTACHED TO THE IFB, CONTAINED THE FOLLOWING CAVEAT IN BOLD FACE TYPE:

NOTICE

THIS PROCUREMENT IS RESTRICTED TO THE QML PROGRAM. SEE SECTION B OF PAGE 6 FAILURE TO NAME A PLACE OF PERFORMANCE WILL MAKE YOUR OFFER NONRESPONSIVE.

YOU HAVE FURTHER QUESTIONED THE POLICY RATIONALE BEHIND THE DISTINCTION MADE BETWEEN A QML BID AND A NON-QML BID AS TO PLACE OF PERFORMANCE. FIRSTLY, THE DISCOVERY OF SEVERAL FLAGRANT PRACTICES IN CONNECTION WITH MILITARY CLOTHING PROCUREMENT LED TO INVESTIGATIONS OF PROCUREMENT PRACTICES AND PROCEDURES IN THAT FIELD BY VARIOUS COMMITTEES OF THE CONGRESS DURING THE 1950S. THESE INVESTIGATIONS CULMINATED IN RECOMMENDATIONS DIRECTED IN LARGE PART TO THE ADOPTION OF PROCEDURES IN MILITARY CLOTHING PROCUREMENTS WHICH WOULD GIVE THE GREATEST ASSURANCE THAT BIDDERS WOULD SUBMIT ADEQUATE INFORMATION TO PERMIT THE CONTRACTING AGENCY TO ASCERTAIN BEYOND ANY REASONABLE DOUBT THAT THE BIDDER WAS AN ESTABLISHED AND REPUTABLE MANUFACTURER WITH SUFFICIENT CAPACITY AND CREDIT TO PERFORM THE CONTRACT, TO PERMIT SUCH DETERMINATION TO BE MADE PROMPTLY AND WITHOUT UNDUE DELAY IN CONTRACT AWARDS, AND TO ASSURE THAT CONTRACTS WOULD BE AWARDED ONLY TO RESPONSIBLE BIDDERS AS REQUIRED BY LAW. THESE RECOMMENDATIONS PROVIDED THE IMPETUS FOR THE QML PROGRAM. THE PROCEDURES OF THE QML PROGRAM REQUIRE THAT BIDS RECEIVED FROM FIRMS ON THE QML WHO FAIL TO LIST ANY FACILITY AT ALL AS A PLACE OF PERFORMANCE WILL NOT BE CONSIDERED FOR AWARD. IF THIS WERE NOT SO, THE OFFEROR WOULD HAVE THE OPTION OF DECIDING AFTER BID OPENING WHETHER TO MAKE HIS OFFER RESPONSIVE BY NAMING A FACILITY WHICH HAD BEEN QUALIFIED BY THE QML PRIOR TO BID OPENING, OR NONRESPONSIVE BY NAMING A FACILITY WHICH HAD NOT BEEN QUALIFIED BY THE QML PRIOR TO BID OPENING.

SINCE THE DISCREPANCY IN ART CAP'S BID RESULTED IN A MATERIAL DEVIATION FROM THE ADVERTISED REQUIREMENTS, ART CAP'S BID COULD NOT BE CORRECTED AND THE DEVIATION COULD NOT BE WAIVED. WE MUST THEREFORE CONCLUDE THAT ART CAP'S BID WAS PROPERLY REJECTED. ACCORDINGLY, ART CAP'S PROTEST IS DENIED.