B-173317, AUG 30, 1971

B-173317, AUG 30, 1971

BID PROTEST - NONRESPONSIBILITY - UNSATISFACTORY QUALITY ASSURANCE DECISION DENYING PROTEST OF ACRODYNE, INC., LOW BIDDER, AGAINST AWARD OF CONTRACT TO ANY OTHER FIRM UNDER IFB ISSUED BY NAVAL ELECTRONIC SYSTEMS COMMAND FOR REMOTE SWITCHING CONTROLS, SWITCHING UNITS, AND TELEPHONE SETS. PROTESTANT'S BID WAS REJECTED BECAUSE BIDDER WAS DETERMINED TO BE NONRESPONSIBLE, WHICH WAS BASED ON STATEMENT OF INTENTION GIVEN BY PROTESTANT TO PREAWARD SURVEY TEAM THAT IT INTENDED TO FABRICATE IN ACCORDANCE WITH GOVERNMENT FURNISHED MODELS, RATHER THAN THE SPECIFICATIONS. PROTESTANT JUSTIFIED THIS VIEW ON AN INTERPRETATION OF A "NOTE" ATTACHED TO PERTINENT SPECIFICATION WHICH STATES THAT IN EVENT OF DISCREPANCY BETWEEN MODEL AND THE TECHNICAL DATA, MODEL SHOULD BE FOLLOWED. THE FACT THAT SOLICITATION INDICATES THAT PREFERENCE WAS TO BE GIVEN MODEL OVER TECHNICAL DATA DOES NOT JUSTIFY GIVING IT PREFERENCE OVER SPECIFICATIONS. SINCE ADMINISTRATIVE DETERMINATION OF NONRESPONSIBILITY DOES NOT APPEAR ARBITRARY OR CAPRICIOUS, PROTEST IS DENIED.

TO ACRODYNE, INC.:

WE REFER TO YOUR LETTER OF JUNE 16, 1971, AND SUBSEQUENT CORRESPONDENCE, PROTESTING AGAINST AWARD TO ANY OTHER BIDDER UNDER NAVAL ELECTRONIC SYSTEMS COMMAND INVITATION FOR BIDS NO. N00039-71-B 0120, FOR REMOTE SWITCHING CONTROLS, SWITCHING UNITS AND TELEPHONE SETS.

THE RECORD BEFORE OUR OFFICE INDICATES THAT BIDS WERE OPENED ON APRIL 6, 1971, AND OF THE NINE SOURCES RESPONDING, ACRODYNE WAS DETERMINED TO BE THE APPARENT LOW BIDDER WITH A BID IN THE AMOUNT OF $676,397. ACCORDANCE WITH PRESCRIBED PROCEDURES, THE DEFENSE CONTRACT ADMINISTRATION SERVICES OFFICE, SPRINGFIELD, NEW JERSEY, CONDUCTED A PREAWARD SURVEY OF YOUR FIRM. DURING THE COURSE OF THE SURVEY, REPRESENTATIVES OF YOUR FIRM ADVISED THE SURVEY TEAM THAT ACRODYNE INTENDED TO FABRICATE ITEMS 0001AA, 0001AB AND 0001AD IN ACCORDANCE WITH GOVERNMENT-FURNISHED MODELS, RATHER THAN IN ACCORDANCE WITH THE SPECIFICATIONS. THIS INTERPRETATION OF THE SOLICITATION WAS REJECTED BY THE SURVEY TEAM AND LATER THE CONTRACTING OFFICER.

AS REQUESTED IN YOUR CORRESPONDENCE, WE HAVE REVIEWED YOUR INTERPRETATION OF THE SOLICITATION, AND WE MUST CONCLUDE THAT IT IS WITHOUT MERIT. THE BASIS FOR YOUR INTERPRETATION IS FOUNDED ON THE LANGUAGE OF TWO "NOTES" TO THE PERTINENT SPECIFICATIONS. THE "NOTES" STATE IN IDENTICAL TERMS THAT:

"GOVERNMENT FURNISHED MODELS AND TECHNICAL DATA SUCH AS MICROFILM, DRAWINGS, MANUALS ARE NOT REPRESENTED TO CONFORM TO THE ABOVE SPECIFICATIONS AND ARE PROVIDED FOR GUIDANCE PURPOSES ONLY. IN THE EVENT OF DISCREPANCY BETWEEN THE MODEL AND THE TECHNICAL DATA, GUIDANCE PREFERENCE SHOULD BE GIVEN TO THE MODEL. (SEE CLAUSE ENTITLED 'DISCLAIMER - GOVERNMENT FURNISHED PROPERTY.')"

IN OUR VIEW, A READING OF THE FOREGOING, WITHOUT MORE, INDICATES CLEARLY THAT THE MODEL IS TO BE GIVEN PREFERENCE ONLY WHEN IT CONFLICTS WITH THE TECHNICAL DATA AND THAT THE MODEL IS NOT TO BE GIVEN A PREFERENCE IN THE EVENT OF A CONFLICT WITH THE SPECIFICATIONS. FURTHER, AN EXAMINATION OF THE "DISCLAIMER - GOVERNMENT FURNISHED PROPERTY" CLAUSE REMOVES ANY QUESTION THAT THE SPECIFICATIONS ARE CONTROLLING INSOFAR AS ITEMS 0001AA, 0001AB AND 0001AD ARE CONCERNED.

WHILE NO OTHER ISSUES ARE PRESENTED BY YOUR PROTEST, WE NOTE THAT ON MAY 14, 1971, THE PREAWARD SURVEY REVIEW BOARD RECOMMENDED NO AWARD BE MADE TO ACRODYNE BECAUSE OF A LACK OF FINANCIAL CAPABILITY; IN ADDITION, UNSATISFACTORY QUALITY ASSURANCE CAPABILITY AND INABILITY TO MEET THE DELIVERY SCHEDULE WERE CITED. THEREAFTER, THE CONTRACTING OFFICER CONSIDERED THE BOARD'S RECOMMENDATION, INCLUDING THE DATA SUPPORTING IT, AND DETERMINED THAT ACRODYNE WAS NOT A RESPONSIBLE PROSPECTIVE CONTRACTOR BECAUSE OF LACK OF FINANCIAL CAPABILITY. SEE PARAGRAPH 1-903.1(I) OF THE ARMED SERVICES PROCUREMENT REGULATION. IN ADDITION TO THE RESULTS OF THE SURVEY, WE NOTE THAT THE CONTRACTING OFFICER CONSIDERED YOUR VERIFIED BID PRICE TO BE UNREALISTICALLY LOW SINCE YOUR BID WAS APPROXIMATELY $263,715 BELOW THE NEXT LOW ACCEPTABLE BID AND SUBSTANTIALLY LOWER THAN THE INDEPENDENT GOVERNMENT ESTIMATE.

SINCE YOUR FIRM IS A SMALL BUSINESS CONCERN AND THE DETERMINATION OF NONRESPONSIBILITY RELATED TO A MATTER OF CREDIT, THE MATTER WAS REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR POSSIBLE ISSUANCE OF A CERTIFICATE OF COMPETENCY (COC). BY LETTER DATED AUGUST 16, 1971, COUNSEL, NAVAL ELECTRONIC SYSTEMS COMMAND, FURNISHED OUR OFFICE A COPY OF A LETTER DATED AUGUST 11, 1971, FROM THE NEWARK REGIONAL OFFICE, SBA, WHICH ADVISES THAT SBA HAS CLOSED ITS FILE ON THE MATTER BECAUSE ACRODYNE DECLINED TO FILE AN APPLICATION FOR A COC. THE COUNSEL'S LETTER STATES THAT IN VIEW OF THIS ADVICE, THE CONTRACTING OFFICER PROPOSES TO MAKE AWARD TO THE NEXT LOW RESPONSIVE, RESPONSIBLE BIDDER.

SINCE FROM OUR REVIEW OF THE RECORD BEFORE US, WE CANNOT SAY THAT THE CONTRACTING OFFICER'S DETERMINATION OF NONRESPONSIBILITY WAS ARBITRARY, CAPRICIOUS, GROSSLY ERRONEOUS, FRAUDULENT, OR NOT SUPPORTED BY SUBSTANTIAL EVIDENCE, WE WILL NOT OBJECT TO THE CONTRACTING OFFICER'S DETERMINATION THAT YOUR FIRM WAS NOT A RESPONSIBLE PROSPECTIVE CONTRACTOR FOR THIS PROCUREMENT. ACCORDINGLY, YOUR PROTEST IS DENIED.