B-159062, JUL. 20, 1966

B-159062, JUL. 20, 1966

TO ALTON IRON WORKS, INC.:

REFERENCE IS MADE TO YOUR LETTERS DATED APRIL 27 AND 29, 1966, PROTESTING AGAINST AWARD OF CONTRACT TO GUENTHER MANUFACTURING CO. INC. UNDER INVITATION FOR BIDS NO. AMC/T/23-204-66-358, ISSUED BY HEADQUARTERS, UNITED STATES ARMY AVIATION MATERIEL COMMAND, ST. LOUIS, MISSOURI.

THE SUBJECT INVITATION, ISSUED JANUARY 13, 1966, AND SUBSEQUENTLY AMENDED, SOLICITED BIDS FOR A DEFINITE QUANTITY OF 18,703 EACH, RELEASE, CARGO, PARACHUTE, FSN 1670-799-8494. TWENTY-TWO SOURCES WERE SOLICITED, AND BIDS WERE OPENED ON JANUARY 27, 1966, WITH NO OBJECTIONS HAVING BEEN RAISED AT ANY TIME PRIOR TO BID OPENING. THE SEVEN BIDS RECEIVED ARE SHOWN AS FOLLOWS:

CHART

"BID "A" WITH BID "B" WITH

PREPRODUCTION PREPRODUCTION

SAMPLE AND TESTS SAMPLE AND TESTS

FURNISHED WAIVED "IRVING AIR CHUTE CO. $41.67 NET NONE

INTERNATIONAL CONTROLS CORP. $50.26 NET NONE

ALTON IRON WORKS, INC. $51.40 LESS 1/2 NONE

PERCENT - 20 DAYS

GUENTHER MFG.CO., INC. $56.80 LESS 1/2 $56.70 LESS 1/2

PERCENT - 20 DAYS PERCENT - 20 DAYS

HANDY TOOL MFG.CORP. $57.00 LESS 1/2 NONE

PERCENT - 20 DAYS

M. STEINTHAL AND CO., INC. $59.12 NET $59.12 NET

THE BENDIX CORP. $59.95 NET $58.85 NET"

AFTER PREAWARD SURVEY, THE FIRST LOW BIDDER, IRVING AIR CHUTE CO., WAS DISQUALIFIED AND THE SECOND LOW BIDDER, INTERNATIONAL CONTROLS CORP., WAS FOUND NONRESPONSIVE IN ITS BID. YOUR FIRM, THE THIRD LOW BIDDER, WAS DECLARED NONRESPONSIBLE BY THE CONTRACTING OFFICER AS A RESULT OF INFORMATION CONTAINED IN THE PREAWARD SURVEY REPORT FURNISHED BY THE DEFENSE CONTRACT ADMINISTRATION SERVICES DISTRICT (DCASD), GARDEN CITY, LONG ISLAND, NEW YORK, DATED MARCH 8, 1966, WHICH DISCLOSED THAT THE PAST AND PRESENT PERFORMANCE OF ALTON HAD NOT BEEN SATISFACTORY. IN THIS CONNECTION, IT WAS POINTED OUT THAT OF 55 ALTON CONTRACTS CURRENTLY ADMINISTERED BY DCASD, DELIVERY ON 10 OF THE CONTRACTS WAS OVERDUE. WAS REPORTED THAT OF 20 CONTRACTS COMPLETED SINCE OCTOBER 1964 TO DATE, 16 (OR 80 PERCENT) WERE DELIVERED LATE. THE PREAWARD SURVEY REPORT OBSERVED THAT THE MAJORITY OF THE DELINQUENCIES WAS DUE TO POOR CONTROL ON THE PART OF THE CONTRACTOR IN OBTAINING TIMELY RECEIPT OF MATERIALS FROM ITS SUBCONTRACTORS. IN VIEW OF THE FOREGOING INFORMATION, THE CONTRACTING OFFICER MADE HIS DETERMINATION THAT YOUR FIRM WAS NONRESPONSIBLE WITHIN THE MEANING OF ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1-903.1 (III) FOR FAILURE TO APPLY THE NECESSARY TENACITY AND PERSEVERANCE TO ASSURE DELIVERY WITHIN THE TERMS OF THE CONTRACTS. ACCORDINGLY, AWARD WAS MADE TO GUENTHER, THE NEXT LOWEST RESPONSIBLE BIDDER.

THE CONTROLLING REGULATION, ASPR 1-903.1 (III), UNDER WHICH THE CONTRACTING OFFICER MADE HIS DETERMINATION PROVIDES THAT A PROSPECTIVE CONTRACTOR MUST:

"/III) HAVE A SATISFACTORY RECORD OF PERFORMANCE (CONTRACTORS WHO ARE SERIOUSLY DEFICIENT IN CURRENT CONTRACT PERFORMANCE, WHEN THE NUMBER OF CONTRACTS AND THE EXTENT OF DEFICIENCY OF EACH ARE CONSIDERED, SHALL, IN THE ABSENCE OF EVIDENCE TO THE CONTRARY OR CIRCUMSTANCES PROPERLY BEYOND THE CONTROL OF THE CONTRACTOR, BE PRESUMED TO BE UNABLE TO MEET THIS REQUIREMENT). PAST UNSATISFACTORY PERFORMANCE, DUE TO FAILURE TO APPLY NECESSARY TENACITY OR PERSEVERANCE TO DO AN ACCEPTABLE JOB, SHALL BE SUFFICIENT TO JUSTIFY A FINDING OF NONRESPONSIBILITY AND IN THE CASE OF SMALL BUSINESS CONCERNS, SHALL NOT REQUIRE SUBMISSION OF THE CASE TO THE SMALL BUSINESS ADMINISTRATION * * *"

IN OUR DECISIONS B-157203, DATED DECEMBER 29, 1965; B-157549, DATED DECEMBER 21, 1965; AND B-156663, DATED OCTOBER 11, 1965, TO YOU, INVOLVING ISSUES SIMILAR TO THOSE PRESENTED IN THIS CASE, THE CONTRACTING OFFICERS INVOLVED FOUND YOUR ORGANIZATION NONRESPONSIBLE DUE TO POOR PAST PERFORMANCE AND YOUR UNSATISFACTORY PERFORMANCE RECORD WAS NOT FOUND DUE TO LACK OF CREDIT OR CAPACITY, JUST AS THE CONTRACTING OFFICER CONCLUDED IN THE PRESENT CASE.

IN YOUR PROTEST YOU HAVE URGED THAT REVIEW SHOULD HAVE BEEN MADE OF THE MATTER BY THE SMALL BUSINESS ADMINISTRATION (SBA). IN THIS CONNECTION, IT SHOULD BE POINTED OUT THAT UNDER ASPR 1-705, A CONTRACTING OFFICER WHO FINDS A SMALL BUSINESS BIDDER NONRESPONSIBLE FOR REASONS RELATING SOLELY TO CAPACITY OR CREDIT IS REQUIRED TO REFER THE MATTER TO SBA FOR DETERMINATION WHETHER A CERTIFICATE OF COMPETENCY SHOULD BE ISSUED UNLESS THE AWARD MUST BE MADE WITHOUT DELAY. HOWEVER, WHERE THE FINDING OF NONRESPONSIBILITY IS BASED ON A RECORD OF UNSATISFACTORY PERFORMANCE, REFERRAL TO SBA IS REQUIRED ONLY IF THE DELINQUENT PERFORMANCE WAS DUE SOLELY TO INADEQUATE CAPACITY OR CREDIT. PURSUANT TO SUCH PROVISIONS, WHEN A CONTRACTING OFFICER DETERMINES THAT A LOW SMALL BUSINESS BIDDER IS NONRESPONSIBLE FOR REASONS NOT INCLUDED IN SBA CERTIFICATIONS, THAT IS, FACTORS CONCERNING WHETHER A BIDDER WILL, RATHER THAN CAN, PERFORM, THE MATTER OF THE BIDDER'S RESPONSIBILITY NEED NOT BE SUBMITTED TO SBA. COMP. GEN. 298, 300.

FROM THE FACTS SET FORTH, IT IS EVIDENT THAT YOUR UNSATISFACTORY PERFORMANCE ON PRIOR GOVERNMENT CONTRACTS WAS DUE TO REASONS OTHER THAN THOSE SOLELY RELATED TO YOUR FINANCIAL STATUS AND PHYSICAL CAPABILITY TO PERFORM, SUCH AS LACK OF PERSEVERANCE, TENACITY, AND PROPER PLANNING, FACTORS WHICH WE HAVE HELD ARE FOR DETERMINATION BY THE CONTRACTING AGENCY WITHOUT REFERENCE TO SBA. 43 COMP. GEN. 257 AND CASES CITED THEREIN. FURTHER, THE DETERMINATION OF YOUR NONRESPONSIBILITY, BASED UPON SUCH FACTORS, WAS PROPERLY DOCUMENTED AS REQUIRED BY ASPR 1-705.4.

FOR THE REASONS STATED, WE FIND NO LEGAL BASIS FOR OBJECTION TO THE ACTION OF THE CONTRACTING OFFICER IN REJECTING YOUR BID AND MAKING AWARD TO THE NEXT LOW RESPONSIVE, RESPONSIBLE BIDDER. THEREFORE, YOUR PROTEST AGAINST SUCH ACTION IS DENIED.