B-153578, MAY 12, 1964

B-153578, MAY 12, 1964

TO MR. RALPH B. ENGLANDER:

REFERENCE IS MADE TO YOUR TELEGRAM OF FEBRUARY 25, 1964, AND SUBSEQUENT CORRESPONDENCE, PROTESTING THAT YOUR COMPANY WAS NOT AWARDED THE CONTRACT FOR CERTAIN RUCKSACKS INCLUDED AS ITEM 1 IN DEFENSE CLOTHING AND TEXTILE SUPPLY CENTER REQUEST FOR PROPOSAL DSA-1-64-NEG 668, ISSUED JANUARY 3, 1964.

THE RECORD IN THE MATTER BEFORE US SHOWS THAT THE SUBJECT PROCUREMENT WAS NEGOTIATED UNDER 10 U.S.C. 2304 (A) (2) ON THE BASIS OF A DETERMINATION THAT THERE WAS A PUBLIC EXIGENCY FOR THE ARTICLES WHICH WOULD NOT PERMIT OF THE DELAY INCIDENT TO ADVERTISING. IMMEDIATELY FOLLOWING THE ISSUANCE OF THE REQUEST FOR PROPOSALS THE CONTRACTING OFFICER AND THE PURCHASING AGENT CONTACTED THE POTENTIAL OFFERORS AND ADVISED THEM OF THE EMERGENCY NATURE OF THE PROCUREMENT AND THAT IN MAKING THE AWARDS PRIMARY CONSIDERATION WOULD BE GIVEN TO THE ABILITY TO MEET THE REQUIRED DELIVERY SCHEDULE WHICH WAS THEN SET OUT IN THE REQUEST FOR PROPOSALS AS WITHIN 60 DAYS AFTER AWARD. DURING A MEETING WITH YOU ON JANUARY 7 YOU WERE AGAIN ADVISED OF THE URGENT NATURE OF THE PROCUREMENT. IN THAT CONNECTION, THE CONTRACTING OFFICER'S REPORT STATES,"THE CONTRACTING OFFICER AND THE PURCHASING AGENT EMPHASIZED THE EMERGENCY NATURE OF THIS PROCUREMENT SO OFTEN THAT IT IS BELIEVED THE FACT OF ITS URGENCY PERMEATED THE MEETING OF 7 JANUARY 1964 AND ALL OF THE OTHER TELEPHONE CONVERSATIONS WITH MR. ENGLANDER.' HOWEVER, DESPITE THE ADVICE FURNISHED TO YOU ON DIFFERENT OCCASIONS AS TO THE EMERGENCY NATURE OF THE PROCUREMENT, WHEN A PREAWARD SURVEY WAS CONDUCTED AT YOUR PLANT ON JANUARY 27 YOU REFUSED TO SHOW THE SURVEYORS ANY COMMITMENTS WHICH YOU MIGHT HAVE HAD FROM COMPANIES WHICH MIGHT MANUFACTURE FOR YOU CERTAIN ALUMINUM FRAMES WHICH ARE A PART OF THE RUCKSACK. YOU CONTINUED FIRM IN YOUR REFUSAL TO REVEAL ANY COMMITMENTS EVEN WHEN YOU WERE TOLD THAT SUCH INFORMATION WAS BEING REQUIRED IN ORDER TO ASCERTAIN WHETHER YOUR COMPANY WOULD BE ABLE TO MEET THE DELIVERY SCHEDULE. FURTHER, THE PROBABILITY THAT THE DELIVERY SCHEDULE WOULD BE REVISED WAS DISCUSSED WITH YOU AT THE TIME OF THE SURVEY SINCE IT APPEARED THAT A 60-DAY DELIVERY MIGHT BE IMPOSSIBLE TO ACHIEVE. IT WAS STATED TO YOU THAT IF SUCH A CHANGE WAS MADE IN THE FORM OF FURTHER SOLICITATION YOU SHOULD CONSIDER FURNISHING EVIDENCE OF COMMITMENTS. BY TELEGRAM OF FEBRUARY 4 YOU WERE REQUESTED TO REVIEW YOUR COSTS AND TO SUBMIT YOUR LOWEST QUOTATION BASED ON A 90-DAY DELIVERY REQUIREMENT. ALTHOUGH YOU SUBMITTED THE NEW PROPOSAL REQUESTED, YOU DID NOT FURNISH ANY EVIDENCE OF THE COMMITMENTS WHICH YOU WERE TOLD WERE IMPORTANT AT THE TIME OF THE PREAWARD SURVEY. IN THE ABSENCE OF RECEIVING SUCH INFORMATION, THE CONTRACTING OFFICER ASSUMED THAT YOU WERE CONTINUING FIRM IN YOUR REFUSAL TO FURNISH EVIDENCE OF COMMITMENTS. SINCE YOU DID NOT DEMONSTRATE THAT YOU WERE CAPABLE OF MEETING THE DELIVERY REQUIREMENT ESTABLISHED FOR THE PROCUREMENT, YOUR COMPANY WAS REJECTED AS A NONRESPONSIBLE PROPONENT.

YOU CONTEND THAT YOUR FIRM SHOULD NOT HAVE BEEN REJECTED AS NONRESPONSIBLE. YOU STATE THAT WHEN THE SURVEY TEAM WAS IN YOUR PLANT YOU READ TO THEM COMMUNICATIONS FROM SUPPLIERS AND YOU DID NOT REFUSE TO DIVULGE YOUR SOURCES. YOU SAY FURTHER THAT THE ORIGINAL SURVEY WAS BASED ON A 60-DAY DELIVERY AND YOU WERE NOT REQUESTED TO FURNISH COMMITMENTS IN THE TELEGRAM WHICH CALLED FOR NEW PRICES FOR THE 90-DAY DELIVERY. IN ANY EVENT, YOU SAY THE AGENCY KNEW FROM OTHER SOURCES THAT FRAMES WERE AVAILABLE TO THE INDUSTRY WITHIN THE 90-DAY DELIVERY PERIOD. IN ADDITION, YOU POINT OUT THAT THERE IS NO REQUIREMENT IN THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) NOR IN THE REQUEST FOR PROPOSALS THAT FIRM COMMITMENTS BE DISPLAYED. AS EVIDENCE THAT YOUR FIRM IS A RESPONSIBLE COMPANY, YOU REFER TO LETTERS OF COMMENDATION WITH RESPECT TO YOUR PERFORMANCE OF PRIOR CONTRACTS. YOU QUESTION TOO THE FAILURE OF THE CONTRACTING OFFICER TO REFER THE MATTER TO THE SMALL BUSINESS ADMINISTRATION FOR CONSIDERATION WHETHER IT WOULD ISSUE A CERTIFICATE OF COMPETENCY.

IT IS APPARENT THAT THERE IS A DISAGREEMENT BETWEEN YOU AND THE CONTRACTING OFFICER AS TO WHAT INFORMATION YOU FURNISHED AND REFUSED TO FURNISH AT THE PREAWARD SURVEY RELATIVE TO YOUR COMMITMENTS FOR THE ALUMINUM FRAMES. HOWEVER, IT IS A RULE OF LONG STANDING IN OUR OFFICE THAT WHERE THERE IS A DISAGREEMENT ON THE FACTS, THE ADMINISTRATIVE VERSION IS ACCEPTED IN THE ABSENCE OF CLEAR AND CONVINCING EVIDENCE TO THE CONTRARY. THEREFORE, WE MUST PROCEED ON THE BASIS THAT YOU REFUSED TO SHOW THE SURVEYORS ANY COMMITMENTS AND THAT YOU WERE ADMONISHED AT THE TIME OF THE SURVEY TO FURNISH COMMITMENTS IF A CHANGE WAS MADE IN THE DELIVERY SCHEDULE. WHILE THE TELEGRAM REQUESTING RECONSIDERATION OF PROPOSALS DID NOT REITERATE THE INFORMAL ADVICE FURNISHED TO YOU CONCERNING THE COMMITMENTS, YOU REPORTEDLY WERE TOLD DURING THE SURVEY THAT YOU SHOULD CONSIDER FURNISHING THE COMMITMENTS WHEN REVISED PROPOSALS WOULD BE CALLED FOR. YOU WERE THEREFORE WELL AWARE OF THIS REQUIREMENT AND WERE NOT PREJUDICED BY THE FAILURE OF THE TELEGRAM TO INCLUDE SUCH A REQUEST. ALSO, BECAUSE OF YOUR REPORTED ATTITUDE IN RESPECT TO FURNISHING EVIDENCE OF COMMITMENTS AT THE SURVEY AND THE ADVICE TO YOU TO FURNISH SUCH INFORMATION IF YOU CHANGED YOUR MIND, THE CONTRACTING OFFICER COULD HAVE PROPERLY ASSUMED THAT YOU DID NOT INTEND TO FURNISH COMMITMENTS WHEN NONE ACCOMPANIED YOUR REVISED PROPOSAL SOLICITED BY THE TELEGRAM. AS TO YOUR SUGGESTION THAT THE CONTRACTING OFFICER KNEW FROM OTHER SOURCES THAT FRAMES WERE AVAILABLE WITHIN THE 90-DAY DELIVERY PERIOD, HE WOULD NOT HAVE NECESSARILY KNOWN THAT YOU WOULD BE ABLE TO MEET THE DELIVERY SCHEDULE IN THE ABSENCE OF SOME CONCRETE SHOWING FROM YOU THAT YOU HAD COMMITMENTS FROM SUPPLIERS IN A POSITION TO FURNISH THE FRAMES ON TIME.

YOU HAVE STATED THAT ASPR DOES NOT REQUIRE PROSPECTIVE CONTRACTORS TO FURNISH FIRM COMMITMENTS FROM SUPPLIERS. HOWEVER, ASPR 1-902 INDICATES THAT A RESPONSIBLE PROSPECTIVE CONTRACTOR IS ONE WHICH NOT ONLY MEETS THE MINIMUM STANDARDS SET FORTH IN ASPR 1-903 BUT ALSO MEETS SUCH ADDITIONAL STANDARDS AS MAY BE PRESCRIBED FOR SPECIFIC PROCUREMENTS BY PURCHASING ACTIVITIES. THEREFORE, IT IS WITHIN THE CONTEMPLATION OF ASPR THAT SUCH STANDARD BEYOND THE MINIMUM STANDARD AS MAY BE APPROPRIATE IN A GIVEN CASE MAY BE UTILIZED IN DETERMINING A PROPONENT'S RESPONSIBILITY TO PERFORM. APPARENTLY, THAT WAS DONE HERE. WHILE THE REQUIREMENT FOR COMMITMENTS MAY NOT HAVE BEEN SPELLED OUT IN THE REQUEST FOR PROPOSALS, YOU WERE ADVISED OF THE REQUIREMENT AND THE NECESSITY THEREFOR BY PROCUREMENT PERSONNEL AND YOU WERE AFFORDED AN OPPORTUNITY EVEN AFTER THE PREAWARD SURVEY TO FURNISH SUCH INFORMATION, BUT YOU APPARENTLY REFUSED TO DO SO. IT IS SIGNIFICANT TOO THAT YOUR COMPANY ALONE WAS NOT REQUIRED TO FURNISH SUCH INFORMATION; A SIMILAR REQUEST WAS MADE TO EACH COMPANY SURVEYED. NONE OF THE OTHER COMPANIES REFUSED TO FURNISH THE INFORMATION. ALSO, RECENT DECISIONS OF OUR OFFICE HAVE RECOGNIZED THAT A PROCURING ACTIVITY COULD DETERMINE IF A PROSPECTIVE CONTRACTOR HAD A FIRM COMMITMENT WITH A SUPPLIER NOTWITHSTANDING THE OMISSION FROM THE INVITATION FOR BIDS OF A CLAUSE GIVING THE PROCURING ACTIVITY THE RIGHT TO APPROVE OR DISAPPROVE SUBCONTRACTORS. SEE B-151543, JANUARY 17, 1964, AND B-152515, JANUARY 10, 1964.

OF COURSE, IT IS COMMENDABLE THAT YOUR COMPANY HAS RECEIVED COMPLIMENTARY LETTERS ON ITS PAST CONTRACT PERFORMANCE AND SUCH INFORMATION IS ENTITLED TO SOME CONSIDERATION IN EVALUATING THE RESPONSIBILITY OF YOUR FIRM. HOWEVER, THE IMMEDIATE PROCUREMENT WAS NOT ENTIRELY LIKE ALL THE PREVIOUS PROCUREMENTS AND THERE WAS A NEED FOR EXPEDITIOUS PERFORMANCE. UNDER ALL THE CIRCUMSTANCES WE WOULD NOT BE JUSTIFIED IN CONCLUDING THAT THE CONTRACTING OFFICER WAS UNREASONABLE IN HIS REQUEST FOR INFORMATION ON COMMITMENTS IN ORDER TO GAIN PERSONAL ASSURANCE THAT THE AGENCY'S REQUIREMENTS WOULD BE MET BY THE COMPANY AWARDED THE CONTRACT.

WITH RESPECT TO THE CONTRACTING OFFICER'S FAILURE TO REFER THE MATTER TO THE SMALL BUSINESS ADMINISTRATION FOR CONSIDERATION FOR THE ISSUANCE OF A CERTIFICATE OF COMPETENCY, ASPR 1-705.6 (B) (I) PROVIDES THAT THIS PROCEDURE IS NOT MANDATORY WHERE THE CONTRACTING OFFICER CERTIFIES IN WRITING, WHICH HE DID, THAT AWARD MUST BE MADE WITHOUT DELAY. YOU INDICATE THAT THERE WAS A MONTH'S TIME BETWEEN THE OPENING OF PROPOSALS AND THE AWARD OF A CONTRACT IN WHICH THE MATTER COULD HAVE BEEN PRESENTED TO THE SMALL BUSINESS ADMINISTRATION. HOWEVER, BY THE TIME THE PREAWARD SURVEYS WERE COMPLETED, FINAL EVALUATION OF BIDS AND BIDDERS WAS MADE AND CONCURRENCE WAS RECEIVED FROM THE REQUISITIONING OFFICE IN A 90-DAY DELIVERY PERIOD, NOT TO GO BEYOND MAY 15, 1964, TIME DID NOT PERMIT REFERENCE TO THE SMALL BUSINESS ADMINISTRATION IF THE URGENT DEADLINE WAS TO BE MET.

IN THE CIRCUMSTANCES, WE DO NOT BELIEVE THAT IT CAN BE SAID PROPERLY THAT THE CONTRACTING OFFICER IS GUILTY OF ARBITRARY OR CAPRICIOUS CONDUCT. THEREFORE, WE MUST CONCLUDE THAT THERE IS NO PROPER BASIS UPON WHICH THIS OFFICE WOULD BE JUSTIFIED IN OBJECTING TO THE REJECTION OF YOUR COMPANY'S LOW BID.