B-154780, SEP. 22, 1964

B-154780, SEP. 22, 1964

TO MR. MAX E. GREENBERG:

IN YOUR LETTER OF AUGUST 11, 1964, YOU PROTEST THE DISQUALIFICATION OF YOUR CLIENT, HOMER ENGINEERING COMPANY, INC., FOR THE AWARD OF CONTRACT NBY-56848, BY THE BUREAU OF YARDS AND DOCKS, FOR GROUND MAINTENANCE OF HOUSING AREAS AT U.S. NAVAL SUBMARINE BASE, NEW LONDON, CONNECTICUT, DURING FISCAL YEAR 1965. THE BASIS FOR SUCH DISQUALIFICATION IS THAT THE CONTRACTING OFFICER WAS UNABLE TO MAKE AN AFFIRMATIVE DETERMINATION THAT YOUR CLIENT MET THE MINIMUM STANDARDS FOR RESPONSIBLE PROSPECTIVE CONTRACTORS SET FORTH IN ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1- 903, WHICH PROVIDES IN RELEVANT PART AS FOLLOWS:

"1-903.1 GENERAL STANDARDS

EXCEPT AS OTHERWISE PROVIDED IN THIS PARAGRAPH 1-903, A PROSPECTIVE CONTRACTOR MUST---

"/III) HAVE A SATISFACTORY RECORD OF PERFORMANCE * * *.'

YOU CONTEND THAT THE SOLE REASON FOR THE DISQUALIFICATION WAS YOUR CLIENT'S REFUSAL, DURING ITS PERFORMANCE OF THE PRIOR ANNUAL CONTRACT FOR THE SAME SERVICES, TO COMPLY WITH NUMEROUS ORDERS BY THE RESIDENT OFFICER IN CHARGE OF CONSTRUCTION FOR WORK YOU ALLEGE WAS COVERED NOT UNDER YOUR CLIENT'S CONTRACT BUT UNDER WARRANTIES BY OTHER CONTRACTORS. IN THIS REGARD, IT SHOULD BE NOTED THAT THE PRIOR CONTRACT AUTHORIZED ORDERS FOR EMERGENCY MAINTENANCE JOBS EVEN ON WORK COVERED BY SUCH WARRANTIES. YOU SAY THAT "OTHER DISPUTES OF MINOR NATURE, WHICH NORMALLY ARISE DURING THE PERFORMANCE OF ANY CONTRACT, WERE RESOLVED BY THE PARTIES.'

THE RECORDS OF THE BUREAU OF YARDS AND DOCKS INDICATE THAT THE CONTRACTING OFFICIALS CONSIDERED YOUR CLIENT'S WORK UNDER THE PRIOR CONTRACT TO BE SO UNSATISFACTORY AS TO SUPPORT A RECOMMENDATION FOR CANCELLATION OF THE CONTRACT DUE TO SUBSTANTIAL NONPERFORMANCE. THE BUREAU REPORTS THAT IT CONSIDERED THIS RECOMMENDATION JUSTIFIED, BUT DID NOT AUTHORIZE CANCELLATION BECAUSE ONLY THREE MONTHS REMAINED OF THE CONTRACT TERM.

THE RECOMMENDATIONS TO CANCEL THE PRIOR CONTRACT, AND FOR DISQUALIFICATION OF YOUR CLIENT FOR THE CURRENT CONTRACT, WERE BASED ONLY IN PART ON YOUR CLIENT'S REFUSAL TO COMPLY WITH THE AFOREMENTIONED WORK ORDERS. IN THIS CONNECTION, THE REPORT DOCUMENTS FINDINGS TO THE EFFECT THAT HOMER ENGINEERING COMPANY, INC., (1) DID NOT KEEP ACCURATE ACCOUNTS OF WORK PERFORMED; (2) FAILED TO RESPOND TO EMERGENCY MAINTENANCE CALLS WITHIN THE THIRTY MINUTE RESPONSE PERIOD REQUIRED BY THE CONTRACT; (3) FAILED TO PROVIDE SNOW REMOVAL IN ACCORDANCE WITH THE CONTRACT'S SPECIFICATIONS AND DIRECTIONS OF THE CONTRACTING OFFICER; (4) PERFORMED UNACCEPTABLE WORK IN THE REPLACEMENT OF DAMAGED FLOOR TILES, AND BILLED THE GOVERNMENT FOR 144 SQ. FEET INSTEAD OF THE 50 SQ. FEET ACTUALLY REPLACED; (5) USED INFERIOR MATERIAL AND PERFORMED SUBSTANDARD REPAIR WORK IN THE CORRECTION AND REPLACEMENT OF STORM DOOR LATCHES AND DOOR CLOSURES; AND (6) FAILED TO PROPERLY SERVICE AND REPLACE DAMAGED, BROKEN, BENT, OR CORRODED PARTS OF OUTSIDE CLOTHES DRYERS.

IT IS PROVIDED AT 10 U.S.C. 2305 (C) THAT CONTRACT AWARDS PURSUANT TO FORMAL ADVERTISING SHALL BE MADE TO "THE RESPONSIBLE BIDDER" WHOSE BID IS RESPONSIVE AND WILL BE MOST ADVANTAGEOUS TO THE UNITED STATES. IT IS WELL SETTLED THAT THE DETERMINATION OF A BIDDER'S RESPONSIBILITY INVOLVES THE EXERCISE OF A CONSIDERABLE RANGE OF DISCRETION, AND OUR OFFICE HAS CONSISTENTLY ADHERED TO THE RULE THAT THE ADMINISTRATIVE DETERMINATION WILL NOT BE QUESTIONED UNLESS ARBITRARY, CAPRICIOUS OR NOT BASED ON SUBSTANTIAL EVIDENCE. 38 COMP. GEN. 131; 37 COMP. GEN. 430, 435. THIS RULE HAS BEEN APPLIED EVEN THOUGH FOR THE SAME TYPE OF CONTRACT, AT APPROXIMATELY THE SAME TIME, AND BASED ON THE SAME INFORMATION, THE SAME BIDDER HAD BEEN ACCEPTED AS RESPONSIBLE BY ONE AGENCY AND REJECTED BY ANOTHER. 39 COMP. GEN. 468, 472; 37 COMP. GEN. 798.

THIS RULE ALSO HAS BEEN APPLIED ADVERSELY TO A PROSPECTIVE CONTRACTOR WHOSE WORK UNDER A SIMILAR AND CURRENT ANNUAL REQUIREMENTS CONTRACT WAS UNSATISFACTORY, NOTWITHSTANDING A FAVORABLE FACILITY CAPABILITY REPORT, AND TO ONE WHOSE WORK UNDER PRIOR CONTRACTS WAS UNSATISFACTORY, NOTWITHSTANDING THAT A CERTIFICATE OF COMPETENCY HAD BEEN ISSUED BY THE SBA. SEE RESPECTIVELY B-151943, DATED JANUARY 24, 1964; AND B-151121, 43 COMP. GEN. 257, DATED SEPTEMBER 13, 1963. ITS APPLICATION IS APPROPRIATE WHERE THE EVIDENCE OF A DEFICIENT MOTIVATION TO DO AN ACCEPTABLE JOB UNDER THE PRIOR ANNUAL CONTRACT CONSISTS OF MINOR FAULTS WHICH CUMULATIVELY RESULT IN UNDULY INCREASING THE GOVERNMENT'S BURDEN OF ADMINISTERING THE CONTRACT. 43 COMP. GEN. 257, 263-64.

OUR REVIEW OF THE ADMINISTRATIVE RECORD INDICATES THAT THE REASONS FOR DISQUALIFYING YOUR CLIENT FOR THIS PROCUREMENT WERE NOT BASED SOLELY ON ITS REFUSAL TO PERFORM CERTAIN WORK ORDERS, BUT ALSO FOR PERFORMING OTHER WORK IN SUCH A MANNER AS TO UNDULY INCREASE THE GOVERNMENT'S COSTS OF CONTRACT ADMINISTRATION. SINCE IT WOULD APPEAR THAT THE MANNER OF PERFORMING SUCH OTHER WORK WOULD AFFORD AN ADEQUATE BASIS FOR THE BUREAU'S DETERMINATION, WE CANNOT CONCLUDE THAT THE INSTANT DISQUALIFICATION WAS ARBITRARY, CAPRICIOUS OR UNSUPPORTED BY SUBSTANTIAL EVIDENCE. ACCORDINGLY, YOUR PROTEST IS DENIED.