B-160537, JAN. 8, 1968

B-160537, JAN. 8, 1968

BIDS - EVALUATION DECISION TO SECY. OF NAVY CONCERNING PROTEST OF ABC FOOD SERVICE, INC., AGAINST AWARD TO MANPOWER, INC., UNDER NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA INVITATION. SINCE EVALUATION OF BIDS FOR FOOD SERVICES ON BASIS OF PRODUCTIVE MAN HOURS ON THE MANNING SCHEDULE WAS NOT CONDUCTED IN OBJECTIVE MANNER CONSISTENT WITH 10 U.S.C. 2305, AND REVIEW DOES NOT INDICATE CONTRACT WAS AWARDED TO THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER BECAUSE AWARD WAS NOT ON PRICE BUT ON INTANGIBLE FACTOR OF MANNING CHARTS, OPTION UNDER CONTRACT SHOULD NOT BE EXERCISED TO EXTEND THE PRESENT CONTRACT. ANY SOLICITATION BEYOND CURRENT FISCAL YEAR SHOULD BE CONDUCTED UNDER FREE AND OPEN COMPETITIVE PROCEDURES. IN DECISION OF OCTOBER 17, 1967, IT WAS HELD THAT THE INVITATION WAS DEFECTIVE.

TO MR. SECRETARY:

REFERENCE IS MADE TO A LETTER DATED NOVEMBER 27, 1967, FILE REFERENCE SUP 0232A, WITH ENCLOSURES, FROM THE DEPUTY COMMANDER, PURCHASING, NAVAL SUPPLY SYSTEMS COMMAND, FURNISHING A FURTHER REPORT CONCERNING THE PROTEST OF ABC FOOD SERVICE, INC., AGAINST THE AWARD OF A CONTRACT TO MANPOWER, INC., UNDER INVITATION FOR BIDS NO. N00228-67 B-6054, ISSUED BY THE NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA. THIS PROTEST WAS THE SUBJECT OF OUR DECISION OF OCTOBER 17, 1967, TO YOU, WHEREIN WE HELD THAT THE INVITATION DID NOT COMPLY WITH THE STATUTORY ADVERTISING REQUIREMENTS. HOWEVER, ON THE BASIS OF THE REPRESENTATIONS MADE AS TO THE ADVERSE EFFECTS THAT WOULD RESULT IF THE AWARD WERE CANCELED AND THE PROCUREMENT READVERTISED, WE DENIED THE PROTEST OF ABC FOOD SERVICE AS WELL AS THOSE OF QUALITY MAINTENANCE CO., INC., AND J.V. MOAN COMMISSARY CORP.

AS YOU KNOW, ABC FOOD SERVICE HAS ALLEGED IN ITS LETTER OF OCTOBER 20, 1967, THAT A PROPER EVALUATION OF PRODUCTIVE MAN-HOURS ON THE MANNING SCHEDULE SUBMITTED BY MANPOWER WITH ITS BID WAS NOT MADE BY THE CONTRACTING OFFICER, AND THAT MANPOWER WAS ALLOWED TO REVISE ITS MANNING SCHEDULE AFTER BID OPENING. ALSO, ABC FOOD SERVICE CONTENDS THAT THE JUSTIFICATION AGAINST CANCELLATION OF THE CONTRACT, QUOTED IN OUR DECISION, WAS NOT FACTUAL. ALTHOUGH WE FIND NO SUBSTANTIAL BASIS TO DISAGREE WITH THE ADMINISTRATIVE JUSTIFICATION FOR NOT TAKING CANCELLATION ACTION, WE FEEL STRONGLY THAT THE PROCUREMENT PRESENTS MATTERS OF SUCH SERIOUS CONCERN AS TO REQUIRE CORRECTIVE ACTION.

WE HAVE AGAIN REVIEWED THIS PROCUREMENT IN THE LIGHT OF THE NOVEMBER 27 REPORT AND THE FURTHER REPRESENTATIONS MADE BY ABC FOOD SERVICE AND J. V. MOAN, AND WE HAVE CONCLUDED THAT THE EVALUATION OF BIDS UNDER THE MANNING SCHEDULE PROVISIONS OF THE INVITATION WAS NOT CONDUCTED IN AN OBJECTIVE MANNER CONSISTENT WITH FREE AND OPEN COMPETITION CONTEMPLATED BY 10 U.S.C. 2305 AND THE IMPLEMENTING REGULATIONS IN ASPR SECTION II.

IT IS QUITE CLEAR FROM THE RECORD AVAILABLE TO US THAT U.S. EAGLE, INC., THE SIXTH LOW BIDDER, WAS, IN THE OPINION OF THE COMMANDING OFFICER OF THE NAVAL STATION, TREASURE ISLAND,"THE ONLY BIDDER THAT SUBMITTED A MANNING SCHEDULE WHICH OFFERS A SUFFICIENT NUMBER OF MAN HOURS (992) TO COMPLETELY ACCOMPLISH THE WORK REQUIRED TO OPERATE A GENERAL MESS ON THE LEVEL OF CLEANLINESS AND SANITATION REQUIRED BY THE U.S. NAVY.' IT WAS THEREFORE RECOMMENDED THAT AWARD BE MADE TO U.S. EAGLE. CONCERNING THE BID OF MANPOWER, THIS OFFICIAL STATED:

"MANPOWER, INC. - FOURTH LOW BIDDER

"ALTHOUGH REPRESENTATIVES OF THIS COMPANY SPENT A TOTAL OF SEVERAL DAYS OBSERVING THE GENERAL MESS, FROM EARLY MORNING UNTIL LATE EVENING, THEIR MANNING SCHEDULE INDICATES A LACK OF RESPONSIBILITY OR UNDERSTANDING OF THE OPERATION. FOR EXAMPLE, THEIR SCHEDULE INDICATES THAT THE DISHWASHING ROOMS (SCULLERIES) WILL BE MANNED BY 18 EMPLOYEES COMMENCING AT 0430 DAILY, OR 1-1/2 HOURS BEFORE THE MESS LINES OPEN FOR BREAKFAST.

"ADDITIONALLY, MANPOWER IS OFFERING A TOTAL MANNING LEVEL 14 PERCENT BELOW THE REQUIRED LEVEL FOR PROPER OPERATION OF THE MESS. THIS SHORTAGE MAINLY REFLECTS IN THE UNDERMANNING OF THE SERVING LINES, THE DISHWASHING AREAS, AND OVERALL CLEANING. DUE TO THESE CIRCUMSTANCES, MANPOWER SHOULD NOT BE AWARDED THE CONTRACT.'

THE RECORD FURTHER SHOWS THAT THE ADMINISTRATIVELY DESIRED MANHOUR LEVEL WAS 990, OR CLOSELY APPROXIMATING THE 992 HOURS OFFERED BY U.S. EAGLE AND THE 923.5 HOURS OFFERED BY SERVOMATION DUCHESS, INC., THE FIFTH LOW BIDDER. HOWEVER, AS TO THE MANPOWER BID, IT IS REPORTED IN THE NOVEMBER 27 LETTER THAT:

"* * * THE ALLEGATION THAT THE FOOD SERVICE OFFICER AT ONE TIME HAD TAKEN THE VIEW THAT 990 MAN HOURS WERE REQUIRED FOR SATISFACTORY OPERATION, IS CORRECT; AND FOR THAT REASON IT WAS RECOMMENDED INITIALLY THAT MANPOWER'S BID OFFERING 840 MAN HOURS NOT BE ACCEPTED. THE FINAL DECISION TO ADOPT THE 849 MAN HOUR LEVEL AS MINIMUM WAS MADE BY THE COMMANDING OFFICER, NAVAL STATION, TREASURE ISLAND, AFTER REVIEW. THE CONTRACTING OFFICER MUST OF NECESSITY RELY ON THE REQUISITIONING ACTIVITY'S ESTIMATE AS TO MINIMUM LEVEL OF STAFFING SUFFICIENT TO INSURE EFFECTIVE OPERATION.'

ALSO, THE REPORT ATTACHED TO THE NOVEMBER 27 LETTER FROM THE DEPUTY COMMANDER, PURCHASING, ADVISED THAT THE CONTRACTING OFFICER HAD UNIFORMLY INTERPRETED ALL STAFFING CHARTS SUBMITTED BY THE BIDDERS AS SUMMARIZING NET AVAILABLE MAN-HOURS. THAT IS TO SAY, THE MANNING OR STAFFING CHARTS SUBMITTED WERE EVALUATED ON THE BASIS THAT NONPRODUCTIVE HOURS WERE NOT INCLUDED SINCE THE STAFFING CHARTS DID NOT MAKE PROVISION FOR NONPRODUCTIVE TIME PERIODS. HOWEVER, NO INSTRUCTIONS WERE INCLUDED IN THE INVITATION, OR ON THE CHARTS THEMSELVES, AS TO HOW THE STAFFING CHARTS WERE TO BE PREPARED. MOREOVER, NO REFERENCE WAS MADE IN THE INVITATION AS TO POSSIBLE DIFFERENCES IN STAFFING BETWEEN WEEKDAYS, WEEKENDS AND HOLIDAYS.

IT IS SIGNIFICANT THAT THE REJECTION OF THE LOW BIDS OF ABC FOOD SERVICE AND J. V. MOAN WAS BASED ON THE FACT THAT THEIR STAFFING CHARTS SHOWED A PER DAY MAN-HOUR FIGURE WHICH WAS LESS THAN THE "MINIMUM OF 849 MAN HOURS PER WEEKDAY WORKING DAY" WHICH WAS REQUIRED TO COMPLY WITH THE TERMS OF THE CONTRACT.

WE ARE UNABLE TO RELATE THIS 849 MAN-HOUR MINIMUM TO THE OBJECTIVE FOR SATISFACTORY OPERATION OF THE GENERAL MESS AT TREASURE ISLAND WHICH HAD BEEN PREVIOUSLY DETERMINED TO BE IN THE NEIGHBORHOOD OF 990 MAN-HOURS. MOREOVER, WE NOW ARE INFORMED THAT MANPOWER OFFERED IN ITS BID 840 MAN- HOURS AND THAT THE CONTRACTING OFFICER "ADOPTED" THE 849 MAN-HOUR LEVEL AS THE MINIMUM ACCEPTABLE TO THE GOVERNMENT. THIS CAN ONLY SUGGEST A POSSIBLE UPWARD REVISION OF THE MANPOWER STAFFING CHART OR A RECOMPUTATION BASED ON A PREMISE THAT ALL HOURS SHOWN ON ITS CHART WERE PRODUCTIVE HOURS.

THE FOREGOING, AND OTHER MATTERS REVEALED IN OUR REVIEW, LEAD US TO THE CONCLUSION THAT THE SUBMITTED STAFFING CHARTS WERE NOT SUSCEPTIBLE TO AN OBJECTIVE EVALUATION UNDER THE INVITATION. NEITHER ARE WE CONVINCED THAT THE AWARD OF THE CONTRACT WAS MADE TO THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER UNDER THE INVITATION SINCE THE BASIS OF AWARD WAS NOT PRICE BUT THE INTANGIBLE FACTOR OF THE MANNING OR STAFFING CHARTS. WE REGARD THIS AWARD FACTOR AS ONE WHICH WAS BASED LARGELY ON A SUBJECTIVE DETERMINATION MADE AFTER BIDS HAD BEEN RECEIVED AND OPENED, AND WHICH WAS NOT MADE KNOWN IN NECESSARY DETAIL TO BIDDERS WHO HAD BEFORE THEM NO GUIDELINES AS TO THE MINIMUM" NEEDS OF THE GOVERNMENT.

SINCE WE HAVE ALREADY HELD THAT THE INVITATION WAS DEFECTIVE AND SINCE WE NOW HOLD THAT THE EVALUATION OF BIDS INSOFAR AS THE MANNING OR STAFFING CHARTS WERE CONCERNED WAS AT VARIANCE WITH SOUND PROCUREMENT PRACTICES, IT IS OUR DECISION THAT THE OPTION UNDER THE MANPOWER CONTRACT SHOULD NOT BE EXERCISED BY THE PROCUREMENT ACTIVITY TO EXTEND THE PRESENT CONTRACT BEYOND JUNE 30, 1968. WE FURTHER BELIEVE THAT ANY SOLICITATION FOR THESE SERVICES BEYOND THE CURRENT FISCAL YEAR SHOULD BE CONDUCTED UNDER PROCEDURES WHICH WILL SUBSERVE THE FREE AND OPEN COMPETITION CONTEMPLATED BY THE ADVERTISING STATUTE.