B-177009, DEC 4, 1972
Highlights
THE CONTRACTING OFFICER HAS THE DUTY AND AUTHORITY TO DETERMINE A BIDDER'S RESPONSIBILITY AND HE IS VESTED WITH A LARGE DEGREE OF DISCRETION IN MAKING THIS DETERMINATION. GAO WILL NOT QUESTION THE CONTRACTING OFFICER'S DECISION UNLESS IT IS SHOWN TO BE ARBITRARY. THERE IS NO BASIS UPON WHICH GAO WOULD BE JUSTIFIED IN CONCLUDING THAT THERE WAS AN ABUSE OF ADMINISTRATIVE DISCRETION IN THIS CASE. TO CANADIAN COMMERCIAL CORPORATION: REFERENCE IS MADE TO YOUR TELEGRAM DATED SEPTEMBER 15. NINE BIDS WERE RECEIVED AND OPENED ON SEPTEMBER 5. ELECTROSPACE'S BID WAS LOW AT $53.95 PER ITEM AND YOUR BID WAS SECOND LOW AT $57.80. YOU PROTEST ANY AWARD TO ELECTROSPACE ON THE GROUNDS THAT ELECTROSPACE'S BID PRICE IS TOO LOW TO ALLOW PERFORMANCE AND BECAUSE YOU BELIEVE ELECTROSPACE IS NOT A RESPONSIBLE BIDDER AS REQUIRED BY ARMED SERVICES PROCUREMENT REGULATION 1-902 AND 1-903.1(I) WHICH REQUIRE A CONTRACTOR TO HAVE ADEQUATE FINANCIAL RESOURCES OR THE ABILITY TO OBTAIN SUCH RESOURCES AS REQUIRED DURING PERFORMANCE OF THE CONTRACT.
B-177009, DEC 4, 1972
BID PROTEST - BIDDER RESPONSIBILITY DECISION DENYING THE PROTEST OF CANADIAN COMMERCIAL CORPORATION, AGAINST THE PROPOSED AWARD OF A CONTRACT TO ELECTROSPACE CORPORATION UNDER AN IFB ISSUED BY U.S. ARMY ELECTRONICS COMMAND, PHILADELPHIA, PA. FOR TELEPHONE SETS. THE CONTRACTING OFFICER HAS THE DUTY AND AUTHORITY TO DETERMINE A BIDDER'S RESPONSIBILITY AND HE IS VESTED WITH A LARGE DEGREE OF DISCRETION IN MAKING THIS DETERMINATION. GAO WILL NOT QUESTION THE CONTRACTING OFFICER'S DECISION UNLESS IT IS SHOWN TO BE ARBITRARY, CAPRICIOUS OR NOT BASED ON SUBSTANTIAL EVIDENCE 45 COMP. GEN. 4 (1965). THERE IS NO BASIS UPON WHICH GAO WOULD BE JUSTIFIED IN CONCLUDING THAT THERE WAS AN ABUSE OF ADMINISTRATIVE DISCRETION IN THIS CASE.
TO CANADIAN COMMERCIAL CORPORATION:
REFERENCE IS MADE TO YOUR TELEGRAM DATED SEPTEMBER 15, 1972, PROTESTING AGAINST A PROPOSED AWARD OF CONTRACT TO ELECTROSPACE CORPORATION (ELECTROSPACE), UNDER INVITATION FOR BIDS (IFB) DAAB-05-73 B-0322, ISSUED AUGUST 1, 1972, BY THE UNITED STATES ARMY ELECTRONICS COMMAND, PHILADELPHIA, PENNSYLVANIA, FOR 30,000 TELEPHONE SETS TA 312/PT.
NINE BIDS WERE RECEIVED AND OPENED ON SEPTEMBER 5, 1972. ELECTROSPACE'S BID WAS LOW AT $53.95 PER ITEM AND YOUR BID WAS SECOND LOW AT $57.80. YOU PROTEST ANY AWARD TO ELECTROSPACE ON THE GROUNDS THAT ELECTROSPACE'S BID PRICE IS TOO LOW TO ALLOW PERFORMANCE AND BECAUSE YOU BELIEVE ELECTROSPACE IS NOT A RESPONSIBLE BIDDER AS REQUIRED BY ARMED SERVICES PROCUREMENT REGULATION 1-902 AND 1-903.1(I) WHICH REQUIRE A CONTRACTOR TO HAVE ADEQUATE FINANCIAL RESOURCES OR THE ABILITY TO OBTAIN SUCH RESOURCES AS REQUIRED DURING PERFORMANCE OF THE CONTRACT. YOU ALLEGE THAT ELECTROSPACE IS IN AN UNSATISFACTORY FINANCIAL POSITION BECAUSE OF A COST OVERRUN WHICH YOU ESTIMATE TO BE IN EXCESS OF $10 MILLION ON AN UNCOMPLETED CONTRACT WHICH ELECTROSPACE HAS WITH THE DEPARTMENT OF DEFENSE. YOU CONTEND THAT THE SITUATION WILL BE AGGREVATED BY THE ALLEGED LOSS ON THE SUBJECT CONTRACT IF AWARD IS MADE TO ELECTROSPACE AT ITS BID PRICE. AWARD OF CONTRACT IS BEING UPHELD PENDING RESOLUTION OF YOUR PROTEST.
BEFORE RECEIPT OF YOUR PROTEST, THE CONTRACTING OFFICER WAS OF THE OPINION THAT THE ELECTROSPACE BID WAS REASONABLE. DUE TO YOUR PROTEST HE REQUESTED A VERIFICATION OF BID PRICE FROM ELECTROSPACE. BY TELEGRAM DATED SEPTEMBER 19, 1972, ELECTROSPACE AFFIRMED ITS BID PRICE AFTER HAVING REVIEWED THE VARIOUS COST ELEMENTS WITH PARTICULAR EMPHASIS ON LABOR. ELECTROSPACE HAS PLANNED TO UTILIZE ITS PLANT LOCATED IN PUERTO RICO IN FULFILLING THE CONTRACT'S REQUIREMENTS. IT HAS BEEN ADMINISTRATIVELY REPORTED THAT THE ELECTROSPACE BID PRICE IS IN LINE WITH PREVIOUS PRICES PAID FOR THE ITEM.
THE ADMINISTRATIVE REPORT FURNISHED THIS OFFICE INCLUDED COMPREHENSIVE PRE-AWARD SURVEYS ON THE ELECTROSPACE PLANTS LOCATED IN NEW YORK AND PUERTO RICO. THESE SURVEYS RECOMMENDED COMPLETE AWARD TO ELECTROSPACE BECAUSE OF THE RATING ELECTROSPACE RECEIVED ON ITS PRODUCTION, TECHNICAL AND FINANCIAL CAPABILITY TO PERFORM THE CONTRACT. WE HAVE ALSO BEEN ADVISED THAT DURING AUGUST 1972, THE GOVERNMENT EXERCISED A CONTRACT OPTION FOR AN ADDITIONAL 10,000 AN/PRC 77 RADIO SETS FROM ELECTROSPACE PURSUANT TO THE CONTRACT AWARDED ELECTROSPACE UNDER IFB DAAB05-68-B-0218, AND CITED IN YOUR PROTEST. BASED ON THE INFORMATION PROVIDED IN THE PRE- AWARD SURVEYS AND TAKING INTO CONSIDERATION THE PERFORMANCE STATUS OF ELECTROSPACE'S CURRENT CONTRACTS, THE CONTRACTING OFFICER DETERMINED THAT ELECTROSPACE IS A RESPONSIBLE BIDDER, WITH THE FINANCIAL ABILITY TO PERFORM THE SUBJECT CONTRACT.
THE CONTRACTING OFFICER HAS THE DUTY AND AUTHORITY TO DETERMINE A BIDDER'S RESPONSIBILITY AND HE IS VESTED WITH A LARGE DEGREE OF DISCRETION IN MAKING THIS DETERMINATION. THIS OFFICE WILL NOT QUESTION THE CONTRACTING OFFICER'S DECISION UNLESS IT IS SHOWN TO BE ARBITRARY, CAPRICIOUS OR NOT BASED ON SUBSTANTIAL EVIDENCE. 45 COMP. GEN. 4 (1965). WE FIND NO BASIS UPON WHICH OUR OFFICE WOULD BE JUSTIFIED IN CONCLUDING THAT THERE WAS AN ABUSE OF ADMINISTRATIVE DISCRETION IN THIS CASE.
CONSEQUENTLY, YOUR PROTEST IS DENIED.