B-143549, OCT. 20, 1960

B-143549, OCT. 20, 1960

TO MODEL ENGINEERING AND MANUFACTURING COMPANY, INC.:

IN A LETTER OF SEPTEMBER 8, 1960, FROM GLENN BLACKSHEAR, ATTORNEY, REQUEST HAS BEEN MADE ON YOUR BEHALF FOR A RECONSIDERATION OF OUR DECISION B-143549 OF AUGUST 31, 1960, WHEREIN WE FOUND NO BASIS TO OBJECT TO THE AWARD OF A CONTRACT MADE BY THE DEPARTMENT OF THE NAVY UNDER INVITATION FOR BID NO. JD-383-944-60.

IN BRIEF, THE INVITATION WAS ISSUED ON APRIL 26, 1960, BY THE AVIATION SUPPLY OFFICE, PHILADELPHIA, PENNSYLVANIA, CALLING FOR A TOTAL OF 881 FREQUENCY METERS, TYPE USM-26. THE PROCUREMENT WAS SET ASIDE EXCLUSIVELY FOR SMALL BUSINESS CONCERNS. SEVENTEEN BIDS WERE RECEIVED, OF WHICH THE LOW BID AS TO PRICE WAS SUBMITTED BY MAXWELL ELECTRONICS, INC., IN THE TOTAL AMOUNT OF $1,022,946.72. MODEL ENGINEERING AND MANUFACTURING CORPORATION WAS FOURTH LOW BIDDER AS TO PRICE IN THE TOTAL AMOUNT OF $1,223,811. AN AWARD OF CONTRACT NO. N 383/11-17-21-24-MIS-383/66295A WAS MADE TO MAXWELL ELECTRONICS CORPORATION ON JUNE 30, 1960, FOR A TOTAL AMOUNT OF $1,022,946.72.

YOUR ATTORNEY PROTESTED TO THE EFFECT THAT MAXWELL ELECTRONICS DOES NOT POSSESS THE NECESSARY PHYSICAL OR FINANCIAL RESOURCES TO QUALIFY AS A RESPONSIBLE BIDDER WITHIN THE APPLICABLE PROCUREMENT STATUTES AND REGULATIONS. IN SUPPORT OF SUCH ALLEGATION HE REFERRED TO PREVIOUS INSTANCES WHERE BIDS OF THE ABOVE-NAMED CONTRACTOR HAD BEEN REJECTED. FOUND THAT THE AWARD WAS MADE TO MAXWELL ELECTRONICS AFTER A DETAILED PRE- AWARD SURVEY REPORTED THAT IT POSSESSED THE TECHNICAL KNOWLEDGE AND ABILITY TO PRODUCE THE EQUIPMENT IN COMPLIANCE WITH ALL THE CONTRACTUAL REQUIREMENTS. IT WAS INDICATED THAT IN TWO PREVIOUS INSTANCES MAXWELL BIDS WERE REJECTED. HOWEVER, THE REJECTIONS WERE NOT BASED UPON ADVERSE FACILITY CAPABILITY REPORTS BUT, IN ONE CASE, UPON AN INABILITY TO COMPLY WITH THE DELIVERY REQUIREMENTS, AND, IN THE OTHER CASE, UPON A FAILURE OF THE BIDDER TO OBTAIN PRIOR APPROVAL OF ITS EQUIPMENT BY THE FEDERAL COMMUNICATIONS COMMISSION, AS REQUIRED BY THE INVITATION. ON THE FOREGOING BASIS WE DID NOT FEEL JUSTIFIED IN QUESTIONING THE ACTION TAKEN BY THE ADMINISTRATIVE OFFICE.

IN THE REQUEST FOR RECONSIDERATION, IT IS STATED BY YOUR ATTORNEY THAT HE INITIATED A SURVEY OF THE CONTRACTOR WHICH INDICATED THAT, AT THE TIME OF AWARD, MAXWELL DID NOT POSSESS THE REQUISITE EXPERIENCE RECORD, PRODUCTION FACILITIES, INSPECTION, PURCHASING, QUALITY CONTROL PERSONNEL, AND OTHER INDICIA OF A GOING CONCERN CAPABLE OF PRODUCING THE END ITEMS ENVISIONED PURSUANT TO THE REQUIRED DELIVERY SCHEDULES, BUT THAT, SINCE THE AWARD, MAXWELL HAS MADE ARRANGEMENTS TO OBTAIN ADDITIONAL MACHINERY, ADDITIONAL SPACE AND PERSONNEL, AND THE REQUIRED FUNDS. SUCH PRACTICE, IT IS CONTENDED, OPENS THE DOOR TO SO-CALLED PHONE-BOOTH OPERATORS, WHO WILL GO OUT AND OBTAIN WHATEVER IS NECESSARY TO ATTEMPT TO PRODUCE THE END ITEM AFTER OBTAINING AN AWARD MERELY ON THE BASIS OF A LOW BID.

WE RECOGNIZE THAT SOUND PROCUREMENT POLICY REQUIRES, ON BEHALF OF THE GOVERNMENT, CONVINCING PROOF THAT THE SUCCESSFUL BIDDER HAS THE TECHNICAL KNOWLEDGE AND ABILITY TO PERFORM THE CONTRACT SUCCESSFULLY. YOUR ATTORNEY CONTENDS, IN EFFECT, THAT BECAUSE THE LOW BIDDER OBTAINED THE PHYSICAL AND FINANCIAL RESOURCES NEEDED FOR PERFORMANCE AFTER THE AWARD, HE COULD NOT BE CONSIDERED A RESPONSIBLE BIDDER AT THE TIME OF AWARD. WE DO NOT AGREE. IN DETERMINING THE QUESTION OF A BIDDER'S TECHNICAL KNOWLEDGE AND ABILITY TO PERFORM, THE TIME WHICH IS SIGNIFICANT WITH RESPECT THERETO IS THAT AT WHICH PERFORMANCE IS SCHEDULED TO BEGIN. SINCE THE AWARD AND, CONSEQUENTLY, THE DETERMINATION OF RESPONSIBILITY MUST BE MADE PRIOR TO THAT TIME, THE BIDDER MAY BE REGARDED AS RESPONSIBLE IF IN THE VIEW OF THE CONTRACTING OFFICER THE BIDDER WILL BE CAPABLE OF PERFORMING AT THE REQUIRED TIME. 39 COMP. GEN. 655.

WE, THEREFORE, SEE NO REASON TO MODIFY THE CONCLUSION REACHED IN OUR DECISION OF AUGUST 31, 1960, SINCE YOU DO NOT SHOW THAT THE ADMINISTRATIVE DETERMINATION WAS MADE IN BAD FAITH OR WITHOUT REASONABLE FACTUAL BASIS.

ACCORDINGLY, YOUR PROTEST TO THE AWARD MADE UNDER THE SUBJECT INVITATION MUST BE DENIED.