[Protest of Rejection of Bid and Contract Award]

B-208796: Jan 19, 1983

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The second low bidder under a Navy solicitation protested the contract award. The protester, a small business, argued that it had been confused with the low bidder during the preaward evaluation. Both firms had been found to be nonresponsible, and the Small Business Administration (SBA) subsequently declined to issue a Certificate of Competency to the protester. The protester alleged that the contracting officer did not evaluate its capabilities, but rather found it nonresponsible on the basis of the low bidder's delinquent record. Further, the protester maintained that SBA was misled by the evaluation. However, the Navy maintained that each firm was evaluated as a separate entity and that firm was separately determined to be nonresponsible. GAO held that SBA has conclusive authority to determine the responsibility of a small business, unless the protester demonstrates that there was bad faith or fraud involved in the evaluation. GAO did not believe these circumstances to exist in the present case. The protest that the Navy improperly awarded the contract after receiving notice of the protest was denied, because this deficiency was procedural and did not affect the validity of the award. Accordingly, the protest was dismissed.