B-180554, JUN 6, 1974

B-180554, JUN 6, 1974

FAILURE TO COMPLETE AFFIDAVIT OF INDIVIDUAL SURETY IS MATTER OF RESPONSIBILITY, NOT RESPONSIVENESS, WHICH MAY BE CORRECTED PRIOR TO AWARD OF CONTRACT; MOREOVER, USE OF INFORMATION CONTAINED IN AFFIDAVIT IS DISCRETIONARY WITH CONTRACTING OFFICER AND UNLESS USE IS UNREASONABLE, GAO WILL NOT QUESTION ACTION TAKEN.

TO JETS SERVICES, INC.; DYNAMIC INTERNATIONAL, INC.; CHEMICAL TECHNOLOGY, INC.; ABC FOOD SERVICES, INC.; QUALITY MAINTENANCE COMPANY, INC.:

ON NOVEMBER 14, 1973, THE PROCUREMENT DIVISION, FORT LEWIS, WASHINGTON, ISSUED INVITATION FOR BIDS (IFB) NO. DAKF57-74-B-0059, IN REGARD TO FURNISHING MESS ATTENDANT SERVICES AT THREE SITES IN THE STATE OF WASHINGTON - FORT LEWIS, KINGSTON MISSILE SITE, AND YAKIMA FIRING CENTER. EACH INSTALLATION WAS LISTED ON A SEPARATE SCHEDULE AND EITHER SEPARATE OR MULTIPLE AWARDS UNDER THE IFB WERE POSSIBLE.

TEN BIDS WERE RECEIVED IN A TIMELY MANNER AND WERE OPENED ON DECEMBER 20, 1973. PROTESTS HAD BEEN FILED UNDER TWO OF THE THREE SCHEDULES, BUT THE PROTEST OF DYNAMIC INTERNATIONAL, INC. (DYNAMIC) UNDER SCHEDULE "A" HAS BEEN WITHDRAWN BY THE PROTESTER, AND WILL NOT BE CONSIDERED.

THE APPARENT LOW BID ON SCHEDULE "C" WAS SUBMITTED BY JETS SERVICES, INC. (JETS). ON JANUARY 8, 1974, A TELEGRAM WAS RECEIVED BY THE ARMY FROM ABC FOOD SERVICES, INC. (ABC), PROTESTING THE BID OF JETS. THE BASIS FOR THE PROTEST WAS THE FAILURE OF THE INDIVIDUAL SURETIES OF JETS UNDER ITS BID GUARANTEE TO FULLY COMPLETE STANDARD FORM 28, AS REQUIRED BY STANDARD FORM 24. THE INDIVIDUAL SURETIES, IN FILLING OUT STANDARD FORM 28, OMITTED THE INFORMATION REQUESTED UNDER ITEM 10, WHICH WAS THE DISCLOSURE OF OTHER BONDS ON WHICH EACH INDIVIDUAL WAS SURETY AND THE AMOUNT OF EACH BOND. WAS ABC'S POSITION THAT THE ASSETS LISTED UNDER ITEM 7 WERE PLEDGED AS SECURITY AGAINST OTHER PROCUREMENTS, AND THEREFORE UNAVAILABLE TO BE PLEDGED UNDER THE PROCUREMENT. AS A RESULT, ABC BELIEVED THAT THE BID OF JETS "*** SHOULD BE CONSIDERED NONRESPONSIVE DUE TO THE OMISSION OF INFORMATION REQUIRED ON STANDARD FORM NUMBER 28."

THE CONTRACTING OFFICER, ON JANUARY 28, 1974, DETERMINED THAT THE BONDS SUBMITTED BY JETS WERE ADEQUATE AND WERE ACCEPTABLE AS A BID GUARANTEE. ABC WAS NOTIFIED OF THIS AND ITS PROTEST WAS DENIED BY LETTER THAT SAME DATE. AWARD OF SCHEDULE "C" WAS MADE TO JETS ON JANUARY 29, 1974. ABC THEN PROTESTED TO OUR OFFICE ON FEBRUARY 1, 1974.

COUNSEL FOR ABC HAS RAISED A NUMBER OF ISSUES CONCERNING THE RESPONSIVENESS OF THE BID GUARANTEE AS SUBMITTED BY JETS. HOWEVER, IT IS OUR OPINION THAT THESE CONTENTIONS ARE WITHOUT MERIT IN VIEW OF OUR RECENT TREATMENT OF THE SUBJECT OF BID GUARANTEE AND AFFIDAVIT OF INDIVIDUAL SURETY REQUIREMENTS AT 52 COMP. GEN. 184, 187 (1972), WHEREIN WE STATED THAT,

"BASED ON THE ABOVE, WE BELIEVE THAT THE MATTER OF THE NET WORTH OF AN INDIVIDUAL SURETY ON A BID BOND IS NOT ONE RELATING TO THE RESPONSIVENESS OF A BID BUT RATHER TO THE RESPONSIBILITY OF THE SURETY. THE FACT THAT AN AFFIDAVIT OF AN INDIVIDUAL SURETY EITHER HAS NOT BEEN FILED TIMELY OR HAS BEEN FILED TIMELY BUT DISCLOSES ASSETS INSUFFICIENT TO COVER THE PENAL AMOUNT OF THE BOND DOES NOT AFFECT THE ACTUAL NET WORTH OF THE SURETY. SINCE COMPLETION OF THE SURETY AFFIDAVIT IS SOLELY FOR THE BENEFIT OF THE GOVERNMENT TO DISCLOSE FACTS CONCERNING THE RESPONSIBILITY OF THE SURETY, WE SEE NO REASON WHY CONTRACTING OFFICIALS SHOULD NOT BE ABLE TO ASCERTAIN, AFTER BID OPENING BUT SUBJECT TO THE TIME RESTRAINTS OF THE PROCUREMENT, THE ACCEPTABILITY OF AN INDIVIDUAL SURETY BASED ON REQUIRED NET WORTH. SEE B-172750, SEPTEMBER 27, 1971."

SINCE OUR POSITION IS THAT THE ABOVE-MENTIONED FORMS ARE MATTERS OF RESPONSIBILITY, IT NECESSARILY FOLLOWS THAT THEY MAY BE SUBMITTED OR COMPLETED DURING THE PROCUREMENT PROCESS, BUT PRIOR TO AWARD, AND MAY PROPERLY BE FOR CONSIDERATION. THEREFORE, THE FAILURE OF JET'S SURETIES TO COMPLETE STANDARD FORM 28, ITEM 10 DOES NOT RENDER THE BID OF JETS NONRESPONSIVE.

MOREOVER, ARMED SERVICES PROCUREMENT REGULATION (ASPR) 10-201.2, WHICH CONCERNS INDIVIDUAL SURETIES AND THEIR ACCEPTABILITY, STATES "THAT EACH INDIVIDUAL SURETY MUST LIST ON STANDARD FORM 28 A NET WORTH AT LEAST EQUAL TO THE TOTAL PENAL AMOUNT OF THE BOND OR CONSENT OF SURETY." THE SECTION THEN CONTINUES TO STATE THAT THE CONTRACTING OFFICER, AFTER SCRUTINIZING THE INFORMATION ENTERED UNDER ITEM 10, HAS THE AUTHORITY TO DETERMINE WHETHER THE TOTAL AMOUNT, A PORTION THEREOF, OR NONE OF THE AMOUNTS LISTED UNDER ITEM 10 SHOULD BE DEDUCTED FROM THE SURETY'S NET WORTH. ADDITIONALLY, ASPR 10-201.2 RECOGNIZES THE POSSIBILITY THAT A SURETY MAY FAIL TO FULLY COMPLETE STANDARD FORM 28 AND SPECIFICALLY ALLOWS FOR COMPLETION AT A LATER DATE.

THEREFORE, SINCE THE MANNER OF TREATMENT OF THE INFORMATION CONTAINED UNDER ITEM 10 IS DISCRETIONARY WITH THE CONTRACTING OFFICER, OUR OFFICE WILL ONLY QUESTION THE ACTION TAKEN IF IT APPEARS TO HAVE BEEN UNREASONABLE. IN THIS INSTANCE, NO UNREASONABLE ACTION IS EVIDENT.

IN VIEW OF THE FOREGOING, THE PROTEST OF ABC IS DENIED.