B-169596, JUL. 23, 1970

B-169596, JUL. 23, 1970

CONTRACTS -- BID PROTEST -- NEGOTIATED PROCUREMENT -- BIDDER RESPONSIBILITY DECISION TO HUBER CORPORATION, SECOND LOW BIDDER DENYING PROTEST AGAINST AWARD OF CONTRACT BY THE ARMY TO GENERAL STEEL TANK CO., LOW BIDDER, FOR MOTORIZED THREE WHEELED ROLLERS ON BASIS THAT LOW BIDDER COULD NOT AND HAS NOT MET DELIVERY REQUIREMENTS. SECOND LOW BIDDER WHO, PROTESTS AGAINST NEGOTIATED AWARD TO LOW BIDDER ON BASIS THAT BIDDER WAS NOT A MANUFACTURER UNDER WALSH-HEALY ACT AND HAS BEEN UNABLE TO MEET DELIVERY REQUIREMENTS MUST HAVE PROTEST DENIED, SINCE AT TIME OF AWARD BIDDER WAS DETERMINED TO BE RESPONSIBLE AND NOTHING INDICATES SUCH DETERMINATION WAS OUTSIDE REASONABLE RANGE, OR AN ABASE, OF ADMINISTRATIVE DISCRETION. SUBSEQUENT DECISION TO MODIFY DELIVERY REQUIREMENTS IS MATTER OF CONTRACT ADMINISTRATION AND DOES NOT RETROACTIVELY AFFECT VALIDITY OF ORIGINAL CONTRACT AWARD ACTION.

TO HUBER CORPORATION:

WE REFER TO YOUR PROTEST AGAINST THE PROPOSED AWARD OF A CONTRACT BY THE DEFENSE SUPPLY AGENCY TO THE GENERAL STEEL TANK COMPANY (GENERAL) UNDER SOLICITATION NO. DSA700-70-B-2383.

THE SOLICITATION, REQUESTING BIDS ON 27 ROLLER, MTZ, DED, TANDEM 2 AXLE TYPE II, SIZE 5-8 TON IN ACCORDANCE WITH APPLICABLE SPECIFICATIONS, WAS ISSUED ON APRIL 14, 1970. THREE BIDS WERE RECEIVED AND OPENED ON MAY 12, 1970. THE LOW BID WAS SUBMITTED BY GALION IRON WORKS AND MANUFACTURING COMPANY BUT WAS REJECTED AS NONRESPONSIVE BECAUSE IT TOOK EXCEPTION TO CLAUSE 5.107, INSPECTION SYSTEM, OF THE SOLICITATION. THE NEXT LOW BID WAS SUBMITTED BY GENERAL AND YOUR COMPANY WAS THE HIGH BIDDER.

BY LETTER OF MAY 13, 1970, TO THE DIRECTORATE OF PROCUREMENT & PRODUCTION, DEFENSE CONSTRUCTION SUPPLY CENTER, COLUMBUS, OHIO, YOU PROTESTED ANY AWARD TO GENERAL ON THREE GROUNDS:

"1. THEY ARE NOT MANUFACTURERS OF THE ITEM BEING PROCURED UNDER THE SOLICITATION, NAMELY, 5-TO-8-TON TANDEM ROLLERS.

"2. GENERAL STEEL TANK COMPANY WAS AWARDED A CONTRACT BY DCSC -- CONTRACT NO. DSA700-70-C-8755--AND IT IS OUR UNDERSTANDING THAT THAT COMPANY WAS DELINQUENT IN THE PROVISIONS OF THE CONTRACT CALLING FOR DELIVERY OF PROVISIONING DRAWINGS.

"3. GENERAL STEEL TANK COMPANY WAS AWARDED A CONTRACT, NO. DAAK01-69 C- A856-A4, BY U. S. ARMY MOBILITY EQUIPMENT COMMAND, AND WE HAVE BEEN ADVISED *** THAT THAT COMPANY DID NOT MEET THE REQUIREMENTS OF THE CONTRACT AS APPLIED TO ENGINEERING DRAWING, PROVISIONING DATA, AND THE PRE -PRODUCTION UNITS."

ON MAY 14, 1970, THE CONTRACTING OFFICER REQUESTED THE DEFENSE CONTRACT ADMINISTRATION SERVICES OFFICE, BURLINGTON, NORTH CAROLINA (DCASO), TO CONDUCT A PRE-AWARD SURVEY ON GENERAL AND YOU WERE ADVISED OF THIS ACTION ON MAY 25, 1970. THE PRE-AWARD SURVEY BY DCASO DATED MAY 26, 1970, RECOMMENDED COMPLETE AWARD TO GENERAL. TWO DAYS LATER, REPRESENTATIVES OF YOUR COMPANY VISITED THE DEFENSE CONSTRUCTION SUPPLY CENTER AND REQUESTED THAT THE PRE-AWARD SURVEY TAKE INTO CONSIDERATION GENERAL'S PERFORMANCE ON CURRENT CONTRACTS AND BY LETTER OF MAY 28, 1970, YOU REQUESTED THAT THE PERSONNEL CONDUCTING THE PRE-AWARD SURVEY BE HIGHLY QUALIFIED AND DIFFERENT INDIVIDUALS THAN THOSE CONDUCTING PREVIOUS PRE-AWARD SURVEYS ON GENERAL.

THEREAFTER, BY LETTER OF JUNE 12, 1970, DCASO PROVIDED ADDITIONAL INFORMATION IN REGARD TO GENERAL'S PERFORMANCE ON CURRENT CONTRACTS AND REAFFIRMED ITS RECOMMENDATION FOR AWARD TO GENERAL. ON JUNE 17, 1970, THE CONTRACTING OFFICER DETERMINED THAT GENERAL WAS A RESPONSIBLE CONTRACTOR WITHIN THE MEANING OF PARAGRAPH 1-902 OF THE ARMED SERVICES PROCUREMENT REGULATION.

IN REGARD TO THE QUESTION CONCERNING GENERAL'S STATUS AS A MANUFACTURER UNDER THE WALSH-HEALEY ACT, 41 U.S.C. 35, THE DEFENSE SUPPLY AGENCY REPORTS THAT GENERAL IS OBVIOUSLY A MANUFACTURER AS EVIDENCED BY THE FACT THAT IT IS CURRENTLY PRODUCING VERY SIMILAR ITEMS. MOREOVER, AS WE NOTED IN OUR DECISION TO YOU DATED JULY 14, 1970 (B-169596), NEITHER THE WALSH- HEALEY ACT NOR IMPLEMENTING REGULATIONS REQUIRE THE BIDDER TO STIPULATE THAT HE HAS PREVIOUSLY MANUFACTURED THE SPECIFIC ITEM BUT ONLY THAT HE WILL BE THE MANUFACTURER OF THE ITEM. WE DO NOT UNDERSTAND YOU TO CONTEND THAT GENERAL IS IN BREACH OF THIS STIPULATION.

IN REGARD TO YOUR QUESTIONS CONCERNING THE PERFORMANCE BY GENERAL OF CONTRACTS DAAK-01-69-C-A856-A4 AND DSA700-70-C-8755, THE DEFENSE SUPPLY AGENCY RECORDS SHOW THAT THE CONTRACTING OFFICER'S AFFIRMATIVE FINDING ON GENERAL'S RESPONSIBILITY WAS MADE IN THE LIGHT OF GENERAL'S PERFORMANCE UNDER THE TWO CITED CONTRACTS, THE FIRST OF WHICH, AS YOU KNOW, WAS DISCUSSED AND REVIEWED IN OUR DECISION OF JULY 14, 1970. AS TO CONTRACT DSA700-70-C-8755, THE DEFENSE CONTRACT ADMINISTRATION SERVICES OFFICE, BURLINGTON, NORTH CAROLINA, ON JUNE 12, 1970, REPORTED TO THE CHIEF, DEFENSE CONSTRUCTION SUPPLY CENTER, THAT:

"B. *** FIRST ARTICLE TESTING WAS SCHEDULED TO BEGIN 9 JUNE 70. THE CONTRACTOR FAILED TO MEET THIS DATE BECAUSE ENGINE AND ROLLERS WERE NOT RECEIVED FROM VENDOR AS REQUIRED. BOTH ENGINE AND ROLLERS HAVE NOW BEEN RECEIVED AND FRAME IS COMPLETE. THE ASSIGNED INDUSTRIAL SPECIALIST ESTIMATES FIRST ARTICLE TESTING WILL BEGIN APPROXIMATELY 1 JULY 70. PRODUCTION QUANTITIES ARE EXPECTED TO COMPLETE PRIOR TO THE CONTRACTUALLY REQUIRED DATE - 30 EACH 25 JAN. 71 AND 30 EACH 6 MAR. 71.

"C. GENERAL STEEL TANK COMPANY SHOULD EXPERIENCE NONE OF THE ABOVE DIFFICULTIES ON SUBJECT PROCUREMENT. AS POINTED OUT IN THE PRE AWARD SURVEY, THE ITEM ON THIS PROCUREMENT WILL BE IDENTICAL TO THE ROLLER BEING PROCURED ON DSA-700-70-C-8755 EXCEPT FOR THE ENGINE; THUS, GENERAL STEEL TANK COMPANY WILL HAVE ALL REQUIRED PARTS IN STOCK EXCEPT THE ENGINE. THE REQUIRED DIESEL ENGINE IS STOCKED BY ALLIS-CHALMERS AND A DELIVERY QUOTE OF 15 DAYS ARO HAS BEEN RECEIVED BY GENERAL STEEL TANK COMPANY."

DETERMINATIONS CONCERNING THE RESPONSIBILITY OF PROSPECTIVE CONTRACTORS INVOLVE AS EXERCISE OF JUDGMENT AND DISCRETION. THE RECORD OF A PROSPECTIVE CONTRACTOR'S PERFORMANCE ON PAST AND CURRENT CONTRACTS IS A MATTER THAT MUST BE TAKEN INTO ACCOUNT IN ASSESSING THE RESPONSIBILITY OF THE CONTRACTOR. ASPR 1-903.1(III). THIS WAS DONE IN THE INSTANT CASE AND WE CANNOT CONCLUDE, ON THE BASIS OF THE RECORD, THAT GENERAL'S CURRENT PERFORMANCE ON THE TWO CITED CONTRACTS IS DEFICIENT TO SUCH AN EXTENT AS TO WARRANT A FINDING THAT THE CONTRACTING OFFICER'S AFFIRMATIVE DETERMINATION OF RESPONSIBILITY WAS ARBITRARY, CAPRICIOUS OR FRAUDULENT. 38 COMP. GEN. 131, 133 (1958); 37 ID. 430, 435 (1957). ACCORDINGLY, THERE IS NO LEGAL BASIS UPON WHICH WE COULD OVERTURN THE DETERMINATION MADE BY THE CONTRACTING OFFICER.

FINALLY, WITH RESPECT TO YOUR REQUEST OF MAY 28, 1970, THAT THE PERSONNEL CONDUCTING THE PRE-AWARD SURVEY BE HIGHLY QUALIFIED AND DIFFERENT INDIVIDUALS THAN THOSE CONDUCTING PREVIOUS PRE-AWARD SURVEYS ON GENERAL, THE CONTRACTING OFFICER POINTS OUT THAT PRE-AWARD SURVEYS ARE NORMALLY CONDUCTED BY THE SAME PERSONNEL WHO HAVE CONDUCTED PREVIOUS PRE-AWARD SURVEYS OR ARE ASSIGNED TO A GIVEN CONTRACTOR FOR PRODUCTION SURVEILLANCE SINCE THESE INDIVIDUALS ARE MORE FAMILIAR WITH THE CONTRACTOR'S OPERATIONS. THE CONTRACTING OFFICER TAKES THE POSITION, AND WE AGREE, THAT IT WOULD BE AN UNNECESSARY ADMINISTRATIVE BURDEN TO PROVIDE THAT NO INDIVIDUALS WHO HAD PARTICIPATED IN PREVIOUS SURVEYS COULD NOW PARTICIPATE IN THE PRE-AWARD SURVEY OF GENERAL FOR THE INSTANT PROCUREMENT. WHILE YOU HAVE STATED THAT THE INDIVIDUALS CONDUCTING THE SURVEY SHOULD POSSESS THE HIGHEST QUALIFICATIONS, YOU HAVE NOT SHOWN THAT THE PERSONS WHO CONDUCTED THE PRE-AWARD SURVEY OF GENERAL WERE NOT QUALIFIED THROUGH EXPERIENCE OR ABILITY TO ANALYZE THE PRODUCTION CAPABILITIES OF THAT FIRM. ACCORDINGLY, WE SEE NO BASIS TO QUESTION THE CONTRACTING OFFICER'S RELIANCE ON THE RECOMMENDATION OF AWARD BY THE DEFENSE CONTRACT ADMINISTRATION SERVICES OFFICE, BURLINGTON, NORTH CAROLINA.

IN VIEW OF THE FOREGOING, YOUR PROTEST IS DENIED.