B-160537, MAR. 24, 1967

B-160537: Mar 24, 1967

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INC.: REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 27. 532.46 WAS SUBMITTED BY B. THIRTEEN OTHER BIDS WERE RECEIVED RANGING IN PRICE FROM $1. THE LOWEST BID WAS DISREGARDED INASMUCH AS AN ERROR THEREIN WAS ALLEGED AND PROVEN PRIOR TO AWARD PURSUANT TO ASPR 2-406.3 (B). - WERE DETERMINED TO BE NONRESPONSIBLE BECAUSE OF DEFICIENCIES IN THE AREAS OF CAPACITY AND CREDIT. AWARD WAS MADE ON JANUARY 27. 614.00 WAS APPROXIMATELY $200. THIS DIFFERENCE WAS CONSIDERED TO BE SIGNIFICANT AND SUFFICIENT TO SUPPORT A CONCLUSION THAT A CONTRACT AWARDED AT YOUR BID PRICE WOULD RESULT IN CONSIDERABLE LOSS TO YOU AND A PROBABLE FAILURE OF PERFORMANCE. THE CONTRACTING OFFICER DETERMINED PURSUANT TO ASPR 1-902 THAT YOU WERE A NONRESPONSIBLE PROSPECTIVE CONTRACTOR FOR THE PURPOSES OF THIS PROCUREMENT BECAUSE OF THE LACK OF FINANCIAL RESOURCES.

B-160537, MAR. 24, 1967

TO QUALITY MAINTENANCE COMPANY, INC.:

REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 27, 1967, PROTESTING AGAINST THE AWARD OF A CONTRACT TO MANPOWER, INC., BY THE DEPARTMENT OF THE NAVY UNDER INVITATION FOR BIDS NO. N00128-67-B-0248.

THE INVITATION, ISSUED ON NOVEMBER 3, 1966, REQUESTED BIDS COVERING THE SERVICES OF MESS ATTENDANTS AND FOOD HANDLERS FOR 3 SUBSISTENCE BUILDINGS LOCATED AT THE NAVAL TRAINING CENTER, GREAT LAKES, ILLINOIS. THE LOWEST BID IN THE AMOUNT OF $1,518,532.46 WAS SUBMITTED BY B. B. SAXON COMPANY, INC. THIRTEEN OTHER BIDS WERE RECEIVED RANGING IN PRICE FROM $1,737,915.94 TO $3,419,885.70. THE LOWEST BID WAS DISREGARDED INASMUCH AS AN ERROR THEREIN WAS ALLEGED AND PROVEN PRIOR TO AWARD PURSUANT TO ASPR 2-406.3 (B). THE SECOND AND THIRD LOW BIDDERS, DYNAMIC ENTERPRISES, INC., AND YOUR COMPANY--- A SMALL BUSINESS CONCERN--- WERE DETERMINED TO BE NONRESPONSIBLE BECAUSE OF DEFICIENCIES IN THE AREAS OF CAPACITY AND CREDIT. AWARD WAS MADE ON JANUARY 27, 1967, TO MANPOWER, INC., AS THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER AT A BID PRICE OF $1,967,426.29.

AN ADMINISTRATIVE ANALYSIS OF YOUR BID REVEALED THAT YOUR BID PRICE OF $1,758,614.00 WAS APPROXIMATELY $200,000 BELOW THE GOVERNMENT'S MINIMUM ANNUAL COST ESTIMATE OF $2.18 MILLION PER YEAR. THIS DIFFERENCE WAS CONSIDERED TO BE SIGNIFICANT AND SUFFICIENT TO SUPPORT A CONCLUSION THAT A CONTRACT AWARDED AT YOUR BID PRICE WOULD RESULT IN CONSIDERABLE LOSS TO YOU AND A PROBABLE FAILURE OF PERFORMANCE. THE CONTRACTING OFFICER DETERMINED PURSUANT TO ASPR 1-902 THAT YOU WERE A NONRESPONSIBLE PROSPECTIVE CONTRACTOR FOR THE PURPOSES OF THIS PROCUREMENT BECAUSE OF THE LACK OF FINANCIAL RESOURCES.

THE PREAWARD SURVEY CONDUCTED OF YOUR COMPANY REVEALED THAT YOU DID NOT HAVE SUFFICIENT FINANCIAL CAPABILITIES TO PERFORM THE SERVICES CALLED FOR BY THE INVITATION IN VIEW OF YOUR OTHER CONTRACT COMMITMENTS INVOLVING SUBSTANTIAL MONETARY OUTLAYS. ONE OF THE PREREQUISITES FOR AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY IS THAT THE BIDDER MUST HAVE ADEQUATE FINANCIAL RESOURCES OR THE ABILITY TO OBTAIN SUCH RESOURCES AS REQUIRED. ASPR 1-903.1 (1).

WE HAVE HELD THAT THE DETERMINATION OF THE RESPONSIBILITY OF A BIDDER IS TO BE MADE BY THE AUTHORIZED OFFICIAL OF THE CONTRACTING AGENCY WHO IS REQUIRED TO ACT FAIRLY UPON REASONABLE INFORMATION WHICH SUPPORTS THE DETERMINATION MADE. WHEN SUCH OFFICIAL DETERMINES THE RESPONSIBILITY OF A BIDDER, SUCH DETERMINATION CANNOT BE QUESTIONED BY THE COURTS OR OUR OFFICE UNLESS IT WAS ARBITRARY, CAPRICIOUS OR FRAUDULENT. ON THE RECORD BEFORE US, WE FIND NO BASIS TO DISTURB SUCH DETERMINATION. B-152055, SEPTEMBER 11, 1963. SEE, ALSO, 37 COMP. GEN. 798; 38 COMP. GEN. 131; 38 COMP. GEN. 778.

UNDER ASPR 1-705.4 (C), WHEN A BID OF A SMALL BUSINESS CONCERN IS TO BE REJECTED SOLELY BECAUSE THE CONTRACTING OFFICER HAS DETERMINED THE CONCERN TO BE NONRESPONSIBLE AS TO CAPACITY OR CREDIT, THE MATTER MUST BE REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR CONSIDERATION WHETHER A CERTIFICATE OF COMPETENCY SHOULD BE ISSUED. HOWEVER, THAT SAME SECTION PROVIDES THAT SUCH REFERRAL NEED NOT BE MADE TO THE SBA IF THE CONTRACTING OFFICER CERTIFIES THAT THE AWARD MUST BE MADE WITHOUT DELAY, INCLUDES SUCH CERTIFICATE AND SUPPORTING DOCUMENTATION IN THE CONTRACT FILE, AND PROMPTLY FURNISHES A COPY TO THE SBA REPRESENTATIVE. THE CONTRACTING OFFICER HAS CERTIFIED IN WRITING THAT THE URGENCY OF THE SUBJECT PROCUREMENT PRECLUDED THE REFERRAL OF YOUR COMPETENCY TO SBA, SINCE THE PROCEDURES INVOLVED WOULD UNDULY DELAY THE AWARD TO THE PREJUDICE OF THE GOVERNMENT BEYOND A PERIOD IN WHICH ANY PROSPECTIVE CONTRACTOR COULD PERFORM IN ACCORDANCE WITH THE TERMS OF THE CONTRACT.

FOR THE ABOVE REASONS, WE MUST CONCLUDE THAT THERE IS NO LEGAL JUSTIFICATION FOR DISTURBING THE AWARD MADE IN THIS CASE.