B-169218, JUL. 28, 1970

B-169218, JUL. 28, 1970

BID PROTEST -- BIDDER RESPONSIBILITY DECISION TO MARTIN ELECTRONICS, INC., LOW BIDDER, WHO HAS BEEN DETERMINED NONRESPONSIVE, DENYING PROTEST AGAINST AWARD OF CONTRACT TO PENGUIN INDUSTRIES, SECOND LOW BIDDER, FOR FUZES FOR PRACTICE HAND GRENADES BY AMMUNITION PROCUREMENT SUPPLY AGENCY. LOW BIDDER WHOSE EQUIPMENT WAS DETERMINED TO BE OF AN UNSATISFACTORY NATURE, AND WHOSE FIRM WAS FOUND AFTER PRE-AWARD TO BE UNABLE TO MEET QUALITY ASSURANCE REQUIREMENTS HAD BID PROPERLY DENIED AS NONRESPONSIVE SINCE DETERMINATION TO MAKE THE AWARD TO THE RESPONSIVE RESPONSIBLE PROSPECTIVE CONTRACTOR IS PRIMARILY ADMINISTRATIVE MATTER AND EVIDENCE OF RECORD CASTS SUBSTANTIAL DOUBT ON PROTESTANT'S CAPACITY TO PERFORM.

TO MARTIN ELECTRONICS, INC.:

WE REFER TO YOUR TELEGRAM OF MARCH 3, 1970, PROTESTING THE AWARD OF A CONTRACT UNDER REQUEST FOR PROPOSALS (RFP) NO. DAAA09-70-R-0135 ISSUED DECEMBER 1, 1969, BY THE AMMUNITION PROCUREMENT SUPPLY AGENCY, JOLIET, ILLINOIS.

THE SUBJECT RFP WAS ISSUED TO PROCURE 4,467,000 FUZES FOR PRACTICE HAND GRENADES. THE PROCUREMENT WAS DIVIDED INTO THREE SECTIONS: QUANTITY A - 1,060,000 UNITS; QUANTITY B - 3,407,000 UNITS; QUANTITY C 4,467,000 (QUANTITY C IS THE TOTAL OF QUANTITIES A AND B). OFFERORS WERE GIVEN THE OPPORTUNITY TO SUBMIT PROPOSALS ON QUANTITY A, QUANTITIES A AND B, OR QUANTITY A, B AND C. SEVEN FIRMS SUBMITTED PROPOSALS AND YOUR FIRM SUBMITTED AN OFFER OF $0.345 FOR EACH QUANTITY. OF THE THREE OFFERS RECEIVED ON ITEM B, YOUR FIRM SUBMITTED THE LOWEST OFFER.

ON DECEMBER 22, 1969, THE CONTRACTING OFFICER REQUESTED THAT PREAWARD SURVEYS BE CONDUCTED ON YOUR FIRM AND ON THE LOW OFFEROR FOR ITEM A. JOINT PREAWARD SURVEYS WERE CONDUCTED BY PERSONNEL OF THE DEFENSE CONTRACT ADMINISTRATION SERVICE, AMMUNITION PROCUREMENT SUPPLY AGENCY AND PICATINNY ARSENAL. AS A RESULT OF THE SURVEY YOUR FIRM WAS GIVEN A "NO AWARD" RECOMMENDATION AND AWARD OF QUANTITY B WAS MADE TO THE SECOND LOW BIDDER, PENGUIN INDUSTRIES, ON FEBRUARY 11, 1970.

THE PREAWARD SURVEY RECOMMENDATION OF "NO AWARD" WAS BASED UPON THE UNSATISFACTORY QUALITY ASSURANCE CAPABILITY AND THE TECHNICAL CAPACITY OF YOUR FIRM. THE PREAWARD SURVEY TEAM DETERMINED THAT THE QUALITY ASSURANCE CAPABILITY OF YOUR FIRM WAS UNSATISFACTORY BECAUSE IT DID NOT HAVE THE NECESSARY EQUIPMENT TO RUN THE SHOCK, JOLT AND JUMBLE TEST THAT WAS REQUIRED IN THE RFP AND BECAUSE IT WOULD NOT HAVE SUCH EQUIPMENT UNTIL MAY 1970. DELIVERY OF ITEM B WAS TO COMMENCE IN FEBRUARY 1970.

THE PREAWARD SURVEY ALSO DETERMINED THAT YOUR FIRM'S TECHNICAL CAPACITY WAS UNSATISFACTORY. ALTHOUGH YOUR FIRM WAS TECHNICALLY COMPETENT AND HAD ADEQUATE MANUFACTURING FACILITIES WITH WHICH TO PRODUCE THE FUZES, THE STATEMENTS OF YOUR SECRETARY-TREASURER, MR. DIRUBBIO, TO MEMBERS OF THE PREAWARD SURVEY TEAM, RESULTED IN A DETERMINATION THAT YOUR FIRM WAS NOT TECHNICALLY COMPETENT. THE RECORD SHOWS THAT WHEN YOUR SECRETARY- TREASURER WAS QUESTIONED BY A MEMBER OF THE PREAWARD SURVEY AS TO WHETHER YOU COULD MAKE A FUZE WHICH CONFORMED TO THE PROCUREMENT REQUIREMENTS, MR. DIRUBBIO REPLIED THAT YOUR FIRM COULD NOT AND THAT NO ONE IN THE COUNTRY COULD MAKE A FUZE THAT CONFORMED TO ALL THE REQUIREMENTS. ON THE BASIS OF THIS STATEMENT AND YOUR FIRM'S UNSATISFACTORY QUALITY ASSURANCE CAPABILITY, AND THE FACT THAT FUZES PRODUCED BY YOUR FIRM UNDER A PREVIOUS CONTRACT HAD BEEN ACCEPTED ON WAIVERS BECAUSE OF NONCONFORMING CHARACTERISTICS, THE PREAWARD SURVEY TEAM RECOMMENDED THAT NO AWARD BE MADE TO YOUR FIRM. THEREAFTER, THE CONTRACTING OFFICER DETERMINED YOUR FIRM TO BE NONRESPONSIVE AND INELIGIBLE FOR AWARD SINCE IT FAILED TO MEET THE CRITERIA PRESCRIBED BY PARAGRAPH 1-903 OF THE ARMED SERVICES PROCUREMENT REGULATION.

ASPR 1-902 PROVIDES THAT THE AWARD OF CONTRACTS SHALL BE MADE TO RESPONSIBLE PROSPECTIVE CONTRACTORS ONLY, AND THAT THE AWARD OF A CONTRACT TO A SUPPLIER BASED ON LOWEST EVALUATED PRICE ALONE CAN BE FALSE ECONOMY IF THERE IS SUBSEQUENT DEFAULT, LATE DELIVERIES OR OTHER UNSATISFACTORY PERFORMANCE. PARAGRAPH 1-902 GOES ON TO PROVIDE THAT THE CONTRACTING OFFICER SHALL MAKE A DETERMINATION OF NONRESPONSIBILITY IF INFORMATION OBTAINED IN THE PREAWARD SURVEY DOES NOT CLEARLY INDICATE THAT THE PROSPECTIVE CONTRACTOR IS RESPONSIBLE.

WE HAVE HELD THAT THIS DETERMINATION BY THE CONTRACTING OFFICER OF THE PROSPECTIVE CONTRACTOR'S ABILITY OR WILLINGNESS TO PERFORM IS PRIMARILY A MATTER FOR ADMINISTRATIVE DETERMINATION WHICH WILL NOT BE QUESTIONED BY OUR OFFICE IN THE ABSENCE OF EVIDENCE ESTABLISHING FACTS TO THE CONTRARY. THE EVIDENCE OF RECORD HERE SUFFICIENTLY ESTABLISHES THAT THE DETERMINATION MADE BY THE CONTRACTING OFFICER THAT YOUR FIRM WAS NOT A RESPONSIBLE PROSPECTIVE CONTRACTOR WAS SUPPORTED BY ADEQUATE INFORMATION AND EVIDENCE WHICH CAST SUBSTANTIAL DOUBTS ON YOUR FIRM'S CAPACITY TO PROPERLY PERFORM THE CONTEMPLATED CONTRACT.

FOR THE REASONS STATED, WE FIND NO LEGAL BASIS FOR OBJECTION TO THE ACTION OF THE CONTRACTING OFFICER IN REJECTING YOUR OFFER ON THE BASIS NONRESPONSIBILITY AND IN MAKING AWARD TO PENGUIN INDUSTRIES. THEREFORE, YOUR PROTEST IS DENIED.