B-149664, NOV. 23, 1962

B-149664, NOV. 23, 1962

TO NATIONAL CAR RENTALS:

REFERENCE IS MADE TO A LETTER DATED OCTOBER 15, 1962, FROM YOUR CONCERN, REQUESTING RECONSIDERATION OF OUR DECISION DATED OCTOBER 3, 1962, ADDRESSED TO CALIFORNIA RENT CAR, IN WHICH WE DENIED A PROTEST AGAINST THE AWARD OF A CONTRACT PURSUANT TO INVITATION FOR BIDS NO. SFD-5148-62, ISSUED BY THE FEDERAL SUPPLY SERVICE, GENERAL SERVICES ADMINISTRATION, SAN FRANCISCO, CALIFORNIA, UNDER DATE OF APRIL 25, 1962.

IN SUPPORT OF YOUR REQUEST FOR RECONSIDERATION OF THE ACTION TAKEN BY OUR OFFICE IN THIS CASE, REFERENCE WAS MADE IN THE LETTER OF OCTOBER 15, 1962, TO THE SECOND PARAGRAPH ON PAGE TWO OF A LETTER DATED SEPTEMBER 12, 1962, FROM THE GENERAL SERVICES ADMINISTRATION TO OUR OFFICE, STATING THAT---

"* * * AT THE TIME OF AWARD THE REGION HAD NO REASON TO BELIEVE THAT THE EXISTING SIZE CLASSIFICATION OF CALIFORNIA RENT CAR WOULD BE REVISED. * *

RESPECTING THE QUOTED LANGUAGE, IT WAS POINTED OUT IN MR. HILLMAN'S LETTER THAT UNDER DATE OF JULY 16, 1962, YOUR CONCERN SENT A FORMAL NOTICE TO THE GENERAL SERVICES ADMINISTRATION IN SAN FRANCISCO ADVISING THAT AGENCY THAT YOU HAD APPEALED THE SMALL BUSINESS ADMINISTRATION SIZE CLASSIFICATION, ETC. THE LETTER THEN WENT ON TO SAY, IN EFFECT, THAT APPARENTLY THERE WAS NO REASON TO "RUSH" THE AWARD OF THE CONTRACT. OTHER WORDS, IT APPEARS TO BE YOUR BELIEF THAT NO AWARD SHOULD HAVE BEEN MADE PENDING A DECISION ON YOUR APPEAL.

AS A FURTHER BASIS FOR YOUR PROTEST, MR. HILLMAN MADE REFERENCE TO THE FACT THAT UNDER THE AWARD MADE TO AMERICAN RENT A CAR SYSTEM ON JULY 25, 1962, A SUBSTANTIALLY GREATER EXPENDITURE WILL BE INVOLVED THAN WOULD BE THE CASE IF YOUR CONCERN HAD BEEN AWARDED A CONTRACT ON THE BASIS OF YOUR BID. THE LETTER THEN CONTAINS THE FOLLOWING PARAGRAPH:

"WHY IS IT THAT ON AUGUST 30, THIRTY DAYS AFTER THE EXPIRATION OF THE BID, WE, CALIFORNIA RENT CAR, WERE AWARDED THE TRUCK PORTION OF THE BID, WHICH WAS ON THE SAME BID AS THE PASSENGER CARS.'

FINALLY, THE VIEW WAS EXPRESSED IN MR. HILLMAN'S LETTER THAT THE CONTRACT AWARDED TO THE AMERICAN RENT A CAR SYSTEM IS NOT AN EXCLUSIVE ONE, AND THAT IF THIS BE SO, HE INQUIRED AS TO WHETHER IT IS POSSIBLE FOR YOUR CONCERN TO DO BUSINESS WITH THE GENERAL SERVICES ADMINISTRATION ON THE BASIS OF YOUR ORIGINAL BID.

WITH RESPECT TO THE ALLEGED "RUSH" BY THE GENERAL SERVICES ADMINISTRATION TO AWARD A CONTRACT IN THIS CASE, IT MAY BE POINTED OUT THAT THE BID OPENING DATE WAS MAY 17, 1962, AND THAT MORE THAN TWO MONTHS ELAPSED BEFORE THE ACTUAL AWARD WAS MADE. THE RECORD INDICATES THAT DURING THE INTERIM, THAT IS TO SAY, BY LETTER DATED JUNE 4, 1962, TO THE GENERAL SERVICES ADMINISTRATION AT SAN FRANCISCO, THE AMERICAN RENT A CAR SYSTEM ALLEGED THAT CALIFORNIA RENT CAR DID NOT QUALIFY AS SMALL BUSINESS. UNDER DATE OF JUNE 11, 1962, THE CONTRACTING OFFICER REQUESTED THE SMALL BUSINESS ADMINISTRATION TO MAKE A SIZE DETERMINATION OF CALIFORNIA RENT CAR, AND BY LETTER OF JULY 2, 1962, THE SMALL BUSINESS ADMINISTRATION AT LOS ANGELES ADVISED THE CONTRACTING OFFICER OF ITS DETERMINATION ON JUNE 29, 1962, THAT CALIFORNIA RENT CAR, WITH ITS AFFILIATES, WAS LARGE BUSINESS FOR GOVERNMENT PROCUREMENT. IT APPEARS THAT AN AWARD COULD HAVE BEEN MADE IMMEDIATELY FOLLOWING THE RECEIPT OF THE LETTER OF JULY 2, 1962. IT SEEMS CLEAR THAT THE DETERMINATION TO AWARD A CONTRACT TO THE AMERICAN RENT A CAR SYSTEM WAS REACHED IN THE NORMAL COURSE OF BUSINESS AND THAT NO UNDUE HASTE WAS INVOLVED IN MAKING THE AWARD. IN ANY EVENT, YOU WERE ADVISED IN OUR DECISION OF OCTOBER 3, 1962, THAT THE CONTRACTING OFFICER WAS NOT REQUIRED TO DELAY THE AWARD PENDING THE OUTCOME OF YOUR APPEAL TO THE SMALL BUSINESS ADMINISTRATION.

MR. HILLMAN ALSO MADE INQUIRY AS TO WHY YOUR CONCERN WAS AWARDED A CONTRACT ON AUGUST 30, 1962, FOR THE TRUCK PORTION OF THE BID. RESPECTING THIS INQUIRY WE MAY SAY THAT ON THE BASIS OF THE FACTS IN THIS CASE A QUESTION ARISES AS TO THE PROPRIETY OF THE AWARD TO YOUR CONCERN. WE SAY THIS BECAUSE OF YOUR OWN ACTION IN CHANGING YOUR STATUS FROM LARGE TO SMALL BUSINESS AFTER THE BID OPENING. IN A DECISION DATED AUGUST 1, 1961, B-144621, TO THE SECRETARY OF THE ARMY, PUBLISHED AT 41 COMP. GEN. 47, IT WAS HELD THAT AN AWARD UNDER A TOTAL SMALL BUSINESS SET-ASIDE PROCUREMENT TO A LOW LARGE BUSINESS CONCERN WHO, AFTER CERTIFICATION THAT HE WAS A SMALL BUSINESS CONCERN, TOOK ACTION AFTER THE OPENING OF BIDS FOR THE SOLE PURPOSE OF MEETING THE SMALL BUSINESS SIZE CRITERIA, THEREBY QUALIFYING FOR CONSIDERATION, WAS AN AWARD TO A BIDDER WHO WAS GIVEN A SECOND CHANCE AND AN UNDUE ADVANTAGE OVER OTHER BIDDERS AND WAS AN AWARD WHICH WAS NOT ONLY DESTRUCTIVE OF THE COMPETITIVE BIDDING PROCESS BUT WAS ALSO IN CIRCUMVENTION OF THE SMALL BUSINESS PROGRAM. HOWEVER, WE ARE NOT DISPOSED TO QUESTION THE CORRECTNESS OF THE AWARD TO YOUR CONCERN SINCE IT WAS THE ONLY PRICE CONSIDERED REASONABLE ENOUGH TO ACCEPT.

WITH RESPECT TO MR. HILLMAN'S VIEW THAT THE CONTRACT AWARDED TO THE AMERICAN RENT A CAR SYSTEM IS NOT AN EXCLUSIVE ONE, AND WITH REFERENCE TO HIS INQUIRY AS TO WHETHER IT IS POSSIBLE FOR YOUR CONCERN TO DO BUSINESS WITH THE GENERAL SERVICES ADMINISTRATION ON THE BASIS OF YOUR ORIGINAL BID, IT HAS BEEN SHOWN HEREIN THAT AS OF THE DATE OF THE AWARD IN THIS CASE--- JULY 25, 1962--- YOUR BID WAS NOT FOR CONSIDERATION SINCE YOU DID NOT QUALIFY AS A SMALL BUSINESS CONCERN. THE AWARD MADE TO THE AMERICAN RENT A CAR SYSTEM PRESUMABLY COVERED THE NEEDS OF THE GENERAL SERVICES ADMINISTRATION FOR THE SERVICES INVOLVED, AND SINCE THE CONTRACT ENTERED INTO WITH THAT FIRM CONSTITUTES A BINDING OBLIGATION ON THE GOVERNMENT TO OBTAIN THE SERVICES FROM THAT SOURCE, WE KNOW OF NO PROCEDURE UNDER WHICH YOUR CONCERN MIGHT DO BUSINESS WITH THE GENERAL SERVICES ADMINISTRATION ON THE BASIS OF YOUR ORIGINAL BID. FOR THE REASONS SET FORTH ABOVE, WE AGAIN CONCLUDE THAT YOUR PROTEST MUST BE DENIED.