B-146344, OCT. 2, 1961

B-146344, OCT. 2, 1961

TO DYNAMETRICS CORPORATION:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 6, 1961, PROTESTING THE AWARD OF A CONTRACT TO THE HASS INSTRUMENT CORPORATION UNDER INVITATION FOR BIDS NO. 33-604-61-295, ISSUED BY THE GENTILE AIR FORCE STATION, DAYTON, OHIO, UNDER DATE OF FEBRUARY 23, 1961, FOR THE FURNISHING OF A QUANTITY OF BAROMETERS.

IT WAS STATED IN YOUR LETTER OF JULY 6, 1961, AMONG OTHER THINGS, THAT A NEGATIVE FACILITY CAPABILITY REPORT WAS ISSUED ON YOUR COMPANY, BASED UPON AN "ASSUMPTION" THAT AT THE TIME THE REPORT WAS PROCESSED YOUR COMPANY WAS DELINQUENT ON TWO CERTAIN CONTRACTS. YOU CATEGORICALLY DENIED THIS, STATING THAT AT THE TIME A CONTRACT WAS AWARDED TO THE HASS INSTRUMENT CORPORATION YOUR COMPANY HAD CORRECTED THE DELINQUENCIES AND WAS ON SCHEDULE ON BOTH CONTRACTS. ALSO, YOU TOOK THE POSITION THAT SINCE THE BUYER--- THE GENTILE AIR FORCE STATION--- HAD KNOWLEDGE OF THE FACT THAT YOUR CONCERN WAS NO LONGER DELINQUENT ON THE "CONTRACT ADMINISTERED IN HIS GROUP"--- CONTRACT NOT OTHERWISE IDENTIFIED--- IT WAS THE DUTY OF THE BUYER TO SO INFORM THE BOSTON AIR PROCUREMENT DISTRICT IN ORDER THAT A NEW FCR COULD HAVE BEEN RUN ON YOUR COMPANY. IT WAS POINTED OUT IN YOUR LETTER THAT THE ONLY FCR ON YOUR COMPANY WAS PROCESSED ON APRIL 4, 1961, ALMOST THREE MONTHS PRIOR TO THE AWARD. FOR THE REASONS SET FORTH IN YOUR LETTER YOU REQUESTED THAT THE ERROR" OF THE AIR FORCE BE CORRECTED BY TERMINATING THE CONTRACT WITH THE HASS INSTRUMENT CORPORATION AND MAKING AN AWARD TO YOUR COMPANY AS THE LOWEST RESPONSIVE BIDDER.

THE RECORD SHOWS THAT BY THE CITED INVITATION BIDS WERE REQUIRED FOR FURNISHING 188 BAROMETERS MERCURIAL ALTITUDE TEST, TYPE A-1 AND MAINTENANCE HANDBOOKS. FIVE BIDS WERE RECEIVED AND OPENED AS SCHEDULED ON MARCH 27, 1961. THE THREE LOWEST BIDS RECEIVED WERE AS FOLLOWS:

TABLE

COMPANY UNIT PRICE TOTAL PRICE

DYNAMETRICS CORPORATION $594.10$111,690.80

WALLACE AND TIERNAN, INC. 622.00 116,936.00

THE HASS INSTRUMENT CORPORATION 630.00 118,440.00

ON THE BASIS THAT YOUR BID WAS LOW, THE PROCURING ACTIVITY REQUESTED THE BOSTON AIR PROCUREMENT DISTRICT UNDER DATE OF MARCH 29, 1961, TO MAKE A SURVEY TO DETERMINE IF YOUR CONCERN COULD MEET THE TERMS OF THE INVITATION. THE RESULT OF THIS SURVEY WAS NEGATIVE DUE TO A DETERMINATION THAT YOU WERE UNABLE TO MEET THE DELIVERY SCHEDULE AND ALSO THAT YOUR FIRM WAS INVOLVED IN UNSATISFACTORY BUSINESS PRACTICES. UNDER DATE OF APRIL 19, 1961, THE PROCURING ACTIVITY WAS INFORMED OF THE NEGATIVE FACILITY CAPABILITY REPORT BUT THE REPORT WAS NOT REFERRED TO THE SMALL BUSINESS ADMINISTRATION SINCE IT WAS PARTIALLY BASED UPON UNSATISFACTORY BUSINESS PRACTICES. IN THIS CONNECTION, THE WRIGHT-PATTERSON AIR FORCE BASE REPORTED IN AN ENDORSEMENT DATED AUGUST 15, 1961, THAT THE NEGATIVE FCR ON YOUR CONCERN WAS CONCURRED IN BY THE REPRESENTATIVE OF THE SMALL BUSINESS DIVISION OF THE FACILITY ADVISORY BOARD.

ON APRIL 20, 1961, TECHNICAL PERSONNEL WERE REQUESTED TO EVALUATE THE BID OF WALLACE AND TIERNAN, INC.--- THE SECOND LOW BIDDER--- AND UNDER DATE OF MAY 9, 1961, THE PROCURING ACTIVITY WAS ADVISED THAT THE BID OF WALLACE AND TIERNAN DID NOT MEET THE SPECIFICATION REQUIREMENTS. THUS, THE SECOND LOW BID WAS HELD TO BE NOT ACCEPTABLE. ON THE SAME DAY A FACILITY CAPABILITY REPORT WAS REQUESTED ON THE HASS INSTRUMENT CORPORATION--- THE THIRD LOW BIDDER. AN AFFIRMATIVE REPORT WAS RECEIVED ON MAY 19, 1961, AND THE PROCURING ACTIVITY COMMENCED PROCESSING AN AWARD TO THAT FIRM, THE AWARD BEING MADE ON JUNE 26, 1961.

THE RECORD INDICATES THAT THE DEPARTMENT OF THE AIR FORCE REVIEWED THE NEGATIVE FACILITY CAPABILITY REPORT ON YOUR COMPANY, AND THAT DEPARTMENT HAS EXPRESSED THE VIEW THAT THE DETERMINATION MADE THEREIN THAT YOUR COMPANY WOULD BE UNABLE TO MEET THE DELIVERY SCHEDULE WAS JUSTIFIED. ALSO, THE FCR INDICATED THAT YOUR COMPANY MIGHT BE UNABLE TO CONDUCT CERTAIN OPERATIONS WITHIN THE TIME NECESSARY TO MEET THE DELIVERY SCHEDULE. THE DEPARTMENT OF THE AIR FORCE DOES NOT CONSIDER THE DETERMINATION CONCERNING YOUR CONCERN'S BUSINESS ETHICS TO BE SUFFICIENTLY SUPPORTED TO JUSTIFY A NEGATIVE FCR ON THAT BASIS. THE DEPARTMENT, THEREFORE, EXPRESSED THE VIEW THAT THE NEGATIVE FCR SHOULD HAVE BEEN BASED ENTIRELY UPON YOUR INABILITY TO MEET THE DELIVERY SCHEDULE, AND THAT HAD THAT BEEN DONE, THE MATTER WOULD HAVE BEEN REFERRED TO THE SMALL BUSINESS ADMINISTRATION IN ORDER TO PERMIT THAT AGENCY TO ISSUE A CERTIFICATE OF COMPETENCY. HOWEVER, THIS WAS NOT DONE BECAUSE OF THE GOOD FAITH FINDING OF THE FACILITY CAPABILITY SURVEY TEAM.

THE DEPARTMENT OF THE AIR FORCE CONSIDERS THAT AN ERROR WAS MADE IN THIS CASE. HOWEVER, THE DEPARTMENT TAKES THE POSITION THAT SUCH ERROR IS NOT SUFFICIENT TO REQUIRE THE SETTING ASIDE OF THE AWARD MADE IN THIS CASE, PARTICULARLY SINCE THERE IS NO EVIDENCE THAT THE SMALL BUSINESS ADMINISTRATION WOULD HAVE GRANTED A CERTIFICATE OF COMPETENCY IN VIEW OF THE EVIDENCE CONTAINED IN THE FCR. FURTHERMORE, THE DEPARTMENT OF THE AIR FORCE REPORTED THAT THE HASS INSTRUMENT CORPORATION HAS MADE SUBSTANTIAL PROGRESS UNDER THE CONTRACT, AND THAT TO CANCEL THE AWARD AT THIS TIME MERELY TO PERMIT THE SMALL BUSINESS ADMINISTRATION TO RULE ON A CERTIFICATE OF COMPETENCY WOULD RESULT IN SUBSTANTIAL DELAY IN THIS PROCUREMENT, MIGHT BE VERY COSTLY, AND WOULD NOT BE IN THE BEST INTERESTS OF THE GOVERNMENT.

IN THE FIFTH PARAGRAPH OF YOUR LETTER YOU MADE THE DEFINITE STATEMENT THAT AT THE TIME THE CONTRACT IN THIS CASE WAS AWARDED TO THE HASS INSTRUMENT CORPORATION YOUR CONCERN HAD CORRECTED THE DELINQUENCIES (UPON WHICH THE FCR WAS BASED) AND THAT YOU WERE ON SCHEDULE ON BOTH CONTRACTS. ALSO, YOU INDICATED THAT THE CONTRACTING OFFICER HAD KNOWLEDGE OF NEW FACTS WHICH WOULD HAVE CAST DOUBT UPON THE NEGATIVE FCR AT THE TIME THE AWARD WAS MADE TO THE HASS INSTRUMENT CORPORATION.

THE DEPARTMENT OF THE AIR FORCE HAS FURNISHED OUR OFFICE CERTAIN INFORMATION WHICH SEEMS TO HAVE A BEARING ON THE FOREGOING STATEMENTS. WAS REPORTED THAT A REVIEW OF THE TWO CONTRACTS AS TO WHICH YOU CLAIM THE DELINQUENCIES WERE CORRECTED SHOWS THAT ONE CONTRACT WAS STILL DELINQUENT AND THAT THE AIR FORCE WAS FORCED TO MAKE A SUPPLEMENTAL AGREEMENT EXTENDING THE OTHER CONTRACT BECAUSE OF YOUR FAILURE TO MEET DELIVERY SCHEDULES. AS TO CONTRACT NO. AF-33 (604/ 30362, THE DEPARTMENT REPORTS THAT THE SAME WAS STILL IN DEFAULT AS OF AUGUST 7, 1961, AND THAT YOU FORWARDED TO THE AIR FORCE A NEW DELIVERY SCHEDULE WHICH, YOU STATED, WAS NECESSARY BECAUSE OF THE FAILURE OF YOUR SUBCONTRACTOR TO DELIVER CERTAIN PARTS. IT WAS REPORTED FURTHER THAT AS OF SEPTEMBER 7, 1961, THE DEPARTMENT OF THE AIR FORCE HAD NOT ACCEPTED THIS NEW DELIVERY SCHEDULE AND DOES NOT CONSIDER THE DELAY TO BE EXCUSABLE. HOWEVER, BECAUSE OF THE GREATER DELAY WHICH WOULD BE INVOLVED IN THE PROCUREMENT FROM ANOTHER SOURCE, THE INDICATED CONTRACT HAS NOT BEEN TERMINATED FOR DEFAULT.

RESPECTING CONTRACT NO. AF-33 (604/-29785, THE AIR FORCE REPORTS THAT YOU FAILED TO MEET THE DELIVERY SCHEDULE THEREUNDER AND THAT THEREFORE THE AIR FORCE MADE A SUPPLEMENTAL AGREEMENT EXTENDING THE CONTRACT FOR A CONSIDERATION OF $1,150 BECAUSE IT WAS NOT IN THE BEST INTERESTS OF THE GOVERNMENT TO TERMINATE THE SAME. THE REPORTED FACTS AS TO DELAYED DELIVERIES UNDER THE TWO INDICATED CONTRACTS SEEM TO SUPPORT THE DETERMINATION MADE IN THE FACILITY CAPABILITY REPORT TO THE EFFECT THAT YOU COULD NOT MEET THE REQUIRED DELIVERY SCHEDULE CONTAINED IN THE INVITATION FOR BIDS.

UNDER THE FACTS REPORTED IN THIS CASE, WE DO NOT FEEL JUSTIFIED IN DIRECTING CANCELLATION OF THE EXISTING CONTRACT, NOTWITHSTANDING IT APPEARS THAT AN ERROR MAY HAVE BEEN MADE IN NOT REFERRING THE MATTER TO THE SMALL BUSINESS ADMINISTRATION FOR CONSIDERATION. WE MAY NOT OVERLOOK THE FACT THAT THE HASS INSTRUMENT CORPORATION HAS EXPENDED ALMOST $30,000 IN THE PERFORMANCE OF THE CONTRACT ENTERED INTO WITH THAT CONCERN, AND TO CANCEL THE CONTRACT AT THIS LATE DATE WOULD GIVE RISE TO MANY PROBLEMS. ACCORDINGLY, YOUR PROTEST IS DENIED.