B-160152, JAN. 26, 1967

B-160152, JAN. 26, 1967

TO AUDIOVISION:

REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 9, 1966, ADDRESSED TO SENATOR THOMAS H. KUCHEL, WITH COPIES TO CONGRESSMAN GEORGE MILLER, AND THE SECRETARY OF AGRICULTURE, PROTESTING THE AWARD OF A CONTRACT UNDER INVITATION FOR BIDS NO. R5-67-18, WHICH WAS FORWARDED TO OUR OFFICE FOR CONSIDERATION AND REPLY.

THE SUBJECT INVITATION, ISSUED BY THE UNITED STATES DEPARTMENT OF AGRICULTURE, FOREST SERVICE, ON JULY 21, 1966, SOLICITED BIDS FOR THE FURNISHING OF FILM LIBRARY SERVICES DURING FISCAL 1967. PARAGRAPH NO. 7 OF THE SPECIAL PROVISIONS OF THE INVITATION PROVIDED, AS FOLLOWS:

"7. PLANT FACILITIES AND EQUIPMENT

THE CONTRACTOR'S EQUIPMENT AND FACILITIES MUST BE ADEQUATE FOR THE SATISFACTORY PERFORMANCE OF THE SERVICES TO BE REQUIRED UNDER THIS CONTRACT. SUCH EQUIPMENT AND PLANT FACILITIES MAY BE SUBJECT TO INSPECTION BY THE CONTRACTING OFFICER BEFORE AWARD. THE PERSON OR COMPANY SUBMITTING THE MOST ACCEPTABLE BID MAY BE REQUIRED TO SUBMIT SUFFICIENT EVIDENCE THAT HE HAS IMMEDIATELY AVAILABLE AS NEEDED, SUFFICIENT RESOURCES TO PROVIDE THE NECESSARY EQUIPMENT, MATERIALS AND PERSONNEL, TO ENABLE HIM TO MEET THE REQUIREMENTS OF THE CONTRACT. CONTRACTING OFFICER'S DECISION SHALL BE FINAL ASTO ADEQUACY OF CONTRACTOR'S PERSONNEL, EQUIPMENT AND FACILITIES FOR SATISFACTORY PERFORMANCE UNDER THIS CONTRACT. TO BE CONSIDERED FOR AWARD, THE BIDDER MUST BE, AND HAVE BEEN, REGULARLY ENGAGED IN THE BUSINESS OF PROVIDING FILM LIBRARY SERVICE FOR TWO YEARS OR MORE.'

IN A MEMORANDUM DATED AUGUST 15, 1966, THE CONTRACTING OFFICER DETERMINED THAT THE BID OF AUDIOVISION SHOULD BE REJECTED ON THE GROUND THAT THE COMPANY DID NOT MEET THE EXPERIENCE REQUIREMENTS OF THE INVITATION OR POSSESS THE NECESSARY FACILITIES FOR PROPER PERFORMANCE OF THE WORK.

A DETERMINATION OF WHETHER SPECIFICATIONS SETTING OUT QUALIFICATIONS REQUIRED OF BIDDERS PROPOSING TO FURNISH SERVICES INA SPECIALIZED FIELD ARE RESTRICTIVE OR DISCRIMINATORY DEPENDS UPON WHETHER THE BEST INTERESTS OF THE GOVERNMENT MAY BE REASONABLY SAID TO NECESSITATE THE IMPOSITION OF SUCH REQUIREMENTS. 37 COMP. GEN. 196; 35 ID. 161; 26 ID. 676; 20 ID. 863, 865. DETERMINATIONS WITH RESPECT TO TYPES OF EXPERIENCE, EXTENT OF SUCH EXPERIENCE, AND THE METHOD OF PROVING EXPERIENCE ARE, IN THE FIRST INSTANCE, SOLELY WITHIN THE PROVINCE OF THE PROCURING AGENCY, AND IN THE ABSENCE OF CONVINCING EVIDENCE THAT THE REQUIREMENTS IMPOSED BY A PROCURING AGENCY IN THIS AREA ARE CLEARLY UNNECESSARY TO MEET AN AGENCY'S NEEDS AND ADEQUATELY PROTEST THE INTERESTS OF THE GOVERNMENT, OR ARE SO RESTRICTIVE AS TO LIMIT COMPETITION TO THE EXTENT THAT THE GOVERNMENT IS DEPRIVED OF THE BENEFITS OF COMPETITIVE BIDDING, THIS OFFICE IS NOT INCLINED TO SUBSTITUTE ITS JUDGMENT FOR THAT OF THE PROCURING AGENCY.

THE PERTINENT STATUTORY PROVISION FOR APPLICATION IS THAT "AWARD SHALL BE MADE * * * TO THAT RESPONSIBLE BIDDER WHOSE BID, CONFORMING TO THE INVITATION FOR BIDS, WILL BE MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED.' 41 U.S.C. 253, SUPRA. UNDER SIMILAR STATE STATUTES REQUIRING AWARDS TO THE LOWEST RESPONSIBLE BIDDER, IT IS HELD THAT RESPONSIBILITY IS A QUESTION OF FACT, AND THAT REJECTION OF THE LOWEST BIDDER ON THE GROUND OF LACK OF RESPONSIBILITY MUST BE BASED UPON A FULL AND HONEST INVESTIGATION OF THE QUALIFICATIONS OF THE BIDDER (PEARLMAN V. CITY OF PITTSBURGH, 304 PA. 24, 155 ATL. 119); OR SUPPORTED BY A FINDING THAT THE BIDDER WAS SO LACKING IN THE EXPERIENCE, FINANCIAL ABILITY, MACHINERY AND FACILITIES NECESSARY TO PERFORM THE CONTRACT AS TO JUSTIFY A BELIEF UPON THE PART OF FAIR MINDED AND REASONABLE MEN THAT HE WOULD NOT BE ABLE TO PERFORM THE CONTRACT (SILLITA V. CEDAR GROVE TOWNSHIP, 133 N.J.L. 41, 42 A.2D 383).

INASMUCH AS YOUR CONTENTION THAT AUDIOVISION POSSESSES THE REQUISITE ABILITIES TO PERFORM THE SUBJECT CONTRACT IS BASED UPON EVIDENCE OF THE PAST SUCCESSFUL PERFORMANCE OF SIMILAR GOVERNMENT CONTRACTS, THE CONTRACTING OFFICER ADVISES THAT THERE IS NO TANGIBLE EVIDENCE THAT ANY OF THE 200 FILMS YOU OWN ARE EVER USED BY THE PUBLIC TO THE EXTENT THAT COULD REASONABLY JUSTIFY THE CONCLUSION THAT YOU ARE EXPERIENCED IN THE MANAGEMENT OF A FILM LIBRARY. HE FURTHER STATES THAT AUDIOVISION IS PRIMARILY ENGAGED IN THE REPAIR AND MAINTENANCE OF MOTION PICTURE PROJECTORS, TAPE RECORDERS, AND SIMILAR ELECTRONIC EQUIPMENT.

THE UNDERLYING QUESTION IS WHETHER AUDIOVISION IS A RESPONSIBLE BIDDER QUALIFIED TO MEET THE COMMITMENT IT UNDERTOOK IN ITS BID, AND INSOFAR AS YOUR CONTENTIONS ARE AT VARIANCE WITH THE FACTS ADMINISTRATIVELY REPORTED, THIS OFFICE IS BOUND BY THE WELL-SETTLED RULE THAT PROHIBITS ANY INTERFERENCE WITH ADMINISTRATIVE DETERMINATIONS OF RESPONSIBILITY IN THE ABSENCE OF A SHOWING OF BAD FAITH OR LACK OF A REASONABLE BASIS THEREFOR. 37 COMP. GEN. 430. THE REASONS FOR THIS RULE ARE SET OUT IN OUR DECISION AT 39 COMP. GEN. 705, IN PART, AS FOLLOWS:

"* * * WHILE SUCH JUDGMENT SHOULD BE BASED ON FACT AND SHOULD BE ARRIVED AT IN GOOD FAITH, IT MUST PROPERLY BE LEFT LARGELY TO THE SOUND ADMINISTRATIVE DISCRETION OF THE CONTRACTING OFFICES INVOLVED, SINCE THEY ARE IN THE BEST POSITION TO ASSESS RESPONSIBILITY, THEY MUST BEAR THE MAJOR BRUNT OF ANY DIFFICULTIES EXPERIENCED BY REASON OF THE CONTRACTOR'S LACK OF ABILITY, AND THEY MUST MAINTAIN THE DAY TO DAY RELATIONS WITH THE CONTRACTOR ON BEHALF OF THE GOVERNMENT. FOR THESE REASONS, IT WOULD BE UNREASONABLE TO SUPERIMPOSE THE JUDGMENT OF OUR OFFICE OR ANY OTHER AGENCY OR GROUP ON THAT OF THE CONTRACTING OFFICIALS.'

FROM OUR REVIEW OF THE RECORD WE BELIEVE THAT THE AGENCY HAS SUPPORTED ITS CONCLUSION THAT AUDIOVISION HAS NOT ENGAGED IN THE MANAGEMENT OF A FILM LIBRARY OF THE SIZE CONTEMPLATED BY THE AGENCY AS A NECESSARY PREREQUISITE TO AWARD OF THE CONTRACT.

IN VIEW OF THE FOREGOING, AND SINCE IT IS NOT APPARENT THAT THE CONTRACTING OFFICER ACTED IN OTHER THAN GOOD FAITH OR WITHOUT A REASONABLE BASIS THEREFOR IN MAKING THE DETERMINATION THAT AUDIOVISION WAS NONRESPONSIBLE IN THIS INSTANCE, OUR OFFICE WOULD NOT BE JUSTIFIED IN QUESTIONING THE AWARD.