James F. Hinchman,
General Counsel
B-210851, APR 26, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE THIRD LOW BIDDER PROTESTS THAT LOW BID SHOULD BE REJECTED, BUT
DOES NOT PROTEST AGAINST SECOND LOW BID, THIRD LOW BIDDER IS NOT AN
"INTERESTED PARTY" UNDER BID PROTEST PROCEDURES BECAUSE IT WOULD NOT BE
IN LINE FOR AWARD IF PROTEST IS SUSTAINED.
NICOLET ANALYTICAL INSTRUMENTS:
NICOLET ANALYTICAL INSTRUMENTS (NICOLET) PROTESTS THE AWARD OF A
CONTRACT TO IBM INSTRUMENTS, INC. (IBM), UNDER INVITATION FOR BIDS NO.
F05611-83-B-0050 ISSUED BY THE UNITED STATES AIR FORCE ACADEMY.
NICOLET PROTESTS THAT IBM'S BID IS NONRESPONSIVE BECAUSE OF
STATEMENTS IN THE DESCRIPTIVE LITERATURE ACCOMPANYING IBM'S BID.
ALTHOUGH WE RECEIVED A REPORT FROM THE CONTRACTING AGENCY ON THE MERITS
OF THE PROTEST AND WE SENT THE REPORT TO NICOLET FOR COMMENT, WE WILL
NOT RESOLVE THE PROTEST.
THE CONTRACTING AGENCY REPORT INDICATES THAT IBM IS THE LOW BIDDER,
PERKIN-ELMER CORP. (PERKIN) IS THE SECOND LOW BIDDER AND NICOLET IS THE
THIRD LOW BIDDER. NICOLET DOES NOT PROTEST AGAINST PERKIN'S BID.
WE DISMISS THE PROTEST BECAUSE NICOLET IS NOT AN "INTERESTED PARTY"
AS REQUIRED BY OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.1(A) (1983).
DETERMINING WHETHER A PARTY IS SUFFICIENTLY INTERESTED INVOLVES
CONSIDERATION OF THE PARTY'S STATUS IN RELATION TO THE PROCUREMENT AND
THE NATURE OF THE ISSUES RAISED. N.D.LEA & ASSOCIATES, INC., B-208445,
FEBRUARY 1, 1983, 83-1 CPD 110.
EVEN ASSUMING THAT IBM'S LOW BID SHOULD HAVE BEEN REJECTED, NICOLET
HAS NOT INDICATED THAT AN AWARD COULD NOT HAVE BEEN MADE TO THE SECOND
LOW BIDDER. THUS, THE THIRD LOW BID OF NICOLET WOULD NOT BE IN LINE FOR
AWARD IF ITS PROTEST IS UPHELD AND, SINCE NO APPARENT NEED WILL ARISE TO
RESOLICIT THE PROCUREMENT, NICOLET DOES NOT HAVE THE REQUISITE DIRECT
AND SUBSTANTIAL INTEREST WITH REGARD TO THE PROCUREMENT. TEKTRONIX,
INC., B-209573, JANUARY 24, 1983, 83-1 CPD 82; INTERNATIONAL BUSINESS
INVESTMENTS, B-202164.2, JUNE 8, 1981, 81-1 CPD 459.
B-210849, OCT 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. THERE IS NOTHING IMPROPER PER SE IN AN
AGENCY ESTABLISHING A REVISED COMPETITIVE RANGE AFTER
NEGOTIATIONS; THE FACT THAT AN OFFEROR INCLUDED IN THE INITIAL
COMPETITIVE RANGE BUT SUBSEQUENTLY EXCLUDED WILL THUS BE DEPRIVED
OF THE OPPORTUNITY TO SUBMIT A BEST AND FINAL OFFER IS NOT CAUSE
FOR OBJECTION WHERE THE REVISED COMPETITIVE RANGE DETERMINATION
WAS REASONABLE.
2. AN AGENCY'S DECISION TO EXCLUDE THE PROTESTER'S
SECOND HIGHEST RATED PROPOSAL FROM THE REVISED COMPETITIVE RANGE
AFTER NEGOTIATIONS WAS REASONABLE, EVEN THOUGH ONLY THE HIGHEST
RATED OFFEROR WAS LEFT IN THE COMPETITIVE RANGE, WHERE: (1)
TECHNICAL MERIT, NOT PROPOSAL COST WAS THE PRIMARY CONSIDERATION
IN AWARDING THE COST-REIMBURSEMENT TYPE CONTRACT; (2) THE
PROTESTER'S LOWER EXPERIENCE RATING LIKELY COULD NOT BE IMPROVED
IN A BEST AND FINAL OFFER; AND (3) IT DOES NOT APPEAR THE
PROTESTER COULD HAVE REDUCED ITS PROPOSED COSTS SUFFICIENTLY TO
OFFSET THE OTHER OFFEROR'S TECHNICAL SUPERIORITY.
COTTON & COMPANY:
COTTON & COMPANY PROTESTS THE AWARD OF A CONTRACT TO LEONARD G.
BIRNBAUM & COMPANY UNDER REQUEST FOR PROPOSALS (RFP) NO. 283-83-0001,
ISSUED BY THE DEPARTMENT OF HEALTH AND HUMAN SERVICES, NATIONAL
INSTITUTE ON DRUG ABUSE (NIDA), FOR FINANCIAL ADVISORY SERVICES. WE
DENY THE PROTEST.
THE RFP CONTEMPLATED THE AWARD OF A COST-PLUS-FIXED-FEE CONTRACT.
AWARD WAS TO BE BASED PRIMARILY ON TECHNICAL MERIT, COST BECOMING
DETERMINATIVE IF OFFERS WERE CONSIDERED TECHNICALLY EQUAL. SEVEN
PROPOSALS WERE SUBMITTED PRIOR TO THE CLOSING DATE, FOUR OF WHICH WERE
INCLUDED IN A COMPETITIVE RANGE BASED ON AN INITIAL TECHNICAL REVIEW.
THE EVALUATION RESULTS WERE AS FOLLOWS:
PROPOSED
SCORE COST
BIRNBAUM 97.4 $52,155
COTTON 86.8 57,752
SHO IINO ACCOUNTANTS 84.6 92,755
BERT W. SMITH, JR. & CO. 83.4 48,739
FOLLOWING THE INITIAL TECHNICAL EVALUATION, NIDA REQUESTED CLARIFYING
INFORMATION FROM COTTON AND THE TWO LOWER RATED OFFERORS; NIDA FOUND
THAT BIRNBAUM'S PROPOSAL NEEDED NO FURTHER CLARIFICATION. A SECOND
TECHNICAL EVALUATION TAKING INTO ACCOUNT THIS ADDITIONAL INFORMATION
YIELDED THE FOLLOWING SCORES FN1:
SCORE
BIRNBAUM 97.4
COTTON 92.4
SMITH 89.2
SHO IINO 85.8
BASED ON THIS SECOND REVIEW, THE EVALUATION COMMITTEE DETERMINED THAT
BIRNBAUM'S PROPOSAL WAS SUPERIOR TO THE OTHER THREE (WHICH IT CONSIDERED
TECHNICALLY EQUAL). THE CONTRACTING OFFICER ADOPTED THIS FINDING AND IN
A MEMORANDUM ENTITLED "REVISED DETERMINATION OF COMPETITIVE RANGE,"
EXCLUDED COTTON AND THE TWO LOWER RATED OFFERORS FROM THE COMPETITIVE
RANGE BECAUSE THEY "NO LONGER STAND A REASONABLE CHANCE OF BEING
SELECTED FOR AWARD." NIDA SUBSEQUENTLY INITIATED COST NEGOTIATIONS WITH
BIRNBAUM, THE ONLY OFFEROR REMAINING IN THE COMPETITIVE RANGE, AND
REQUESTED ITS BEST AND FINAL OFFER. BIRNBAUM TIMELY SUBMITTED A BEST
AND FINAL OFFER LOWERING ITS PROPOSED COST TO $51,743, AND NIDA AWARDED
THE CONTRACT TO BIRNBAUM.
COTTON ARGUES THAT THE PROCEDURE FOLLOWED BY NIDA - I.E., REDEFINING
THE COMPETITIVE RANGE AFTER NEGOTIATIONS TO ELIMINATE ALL BUT ONE
OFFEROR FROM THE COMPETITION - WAS IMPROPER BECAUSE IT DEPRIVED COTTON
OF THE OPPORTUNITY TO IMPROVE ITS STANDING BY SUBMITTING A BEST AND
FINAL OFFER. COTTON SUBMITS THAT UNDER THE DEPARTMENT OF HEALTH AND
HUMAN SERVICES PROCUREMENT REGULATIONS (HHSPR) SEC. 3-3.5109, ALL
OFFERORS INITIALLY INCLUDED IN THE COMPETITIVE RANGE MUST BE PERMITTED
TO SUBMIT A BEST AND FINAL OFFER.
THERE IS NOTHING IMPROPER PER SE IN AN AGENCY'S MAKING MORE THAN ONE
COMPETITIVE RANGE DETERMINATION. SEE SDC INTEGRATED SERVICES, INC.,
B-195624, JANUARY 15, 1980, 80-1 CPD 44; WASSKA TECHNICAL SYSTEMS AND
RESEARCH COMPANY, B-189573, AUGUST 10, 1979, 79-2 CPD 110. WHILE IN THE
CITED CASES THE SECOND COMPETITIVE RANGE DETERMINATION RESULTED IN THE
EXCLUSION OF ONLY TECHNICALLY UNACCEPTABLE PROPOSALS, WE BELIEVE THE
SAME PRINCIPLE APPLIES WHERE, AS HERE, THE AGENCY EXCLUDES PROPOSALS
FOUND TO NO LONGER HAVE A REASONABLE CHANCE OF BEING SELECTED FOR AWARD.
IT CLEARLY WOULD SERVE NO PRACTICAL PURPOSE TO REQUEST THE OFFEROR'S
BEST AND FINAL OFFER WHERE THE CONTRACTING OFFICER HAS PROPERLY
DETERMINED, EITHER BEFORE OR AFTER NEGOTIATIONS, THAT THE OFFEROR WILL
NOT RECEIVE THE AWARD. THIS APPROACH IS CONSISTENT WITH HHSPR SEC.
3-3.5109, WHICH MERELY STATES, IN RELEVANT PART, THAT IN ORDER TO
TERMINATE NEGOTIATIONS, "EACH OFFEROR WITHIN THE COMPETITIVE RANGE"
SHOULD BE ADVISED TO SUBMIT A BEST AND FINAL OFFER. SINCE COTTON WAS
EXCLUDED FROM THE COMPETITIVE RANGE AFTER NEGOTIATIONS, NIDA WAS NOT
REQUIRED TO SOLICIT COTTON'S BEST AND FINAL OFFER. SEE SDC INTEGRATED
SERVICES, INC., SUPRA.
THE DETERMINATIVE QUESTION IN THIS CASE IS NOT WHETHER A SECOND
COMPETITIVE RANGE WAS PROPER, BUT WHETHER NIDA WAS JUSTIFIED IN
EXCLUDING COTTON FROM THE COMPETITIVE RANGE AT ALL, GIVEN THE APPARENT
CLOSENESS OF COTTON'S AND BIRNBAUM'S SCORES AND PROPOSED COSTS AFTER
NEGOTIATIONS. COTTON MAINTAINS THAT NIDA'S CONCLUSION THAT IT DID NOT
STAND A REASONABLE CHANCE FOR AWARD, WAS "UNFOUNDED AND WHOLLY
UNSUPPORTED."
AS A GENERAL RULE, AN AGENCY SHOULD ENDEAVOR TO INCLUDE IN THE
COMPETITIVE RANGE ANY PROPOSAL CONSIDERED TECHNICALLY ACCEPTABLE,
PARTICULARLY A PROPOSAL WHICH, LIKE COTTON'S, SEEMS CLOSE IN QUALITY AND
COST TO THE HIGHEST RATED PROPOSAL. ONLY IN THIS MANNER CAN MAXIMUM
COMPETITION AND FAIRNESS TO THE OFFERORS BE MAINTAINED. IT IS
WELL-ESTABLISHED, ON THE OTHER HAND, THAT THE DETERMINATION OF WHETHER A
PROPOSAL IS WITHIN THE COMPETITIVE RANGE IS PRINCIPALLY A MATTER OF
ADMINISTRATIVE DISCRETION. ALTHOUGH WE CAREFULLY SCRUTINIZE DECISIONS
WHICH, AS WAS THE CASE HERE, RESULT IN A COMPETITIVE RANGE OF ONE, ART
ANDERSON ASSOCIATES, B-193054, JANUARY 29, 1980, 80-1 CPD 77, WE WILL
NOT DISTURB AN AGENCY'S DECISION ON COMPETITIVE RANGE ABSENT A CLEAR
SHOWING THAT IT WAS UNREASONABLE OR CONTRARY TO PROCUREMENT STATUTES AND
REGULATIONS. SEE TECHDYN SYSTEMS CORPORATION, B-206228, JUNE 28, 1982,
82-1 CPD 628. BASED ON THE GENERAL RULE CITED ABOVE, IT IS CLEAR THAT
COTTON'S PROPOSAL COULD HAVE BEEN INCLUDED IN THE FINAL COMPETITIVE
RANGE FOR PURPOSES OF SUBMITTING A BEST AND FINAL OFFER. AT THE SAME
TIME, HOWEVER, BASED ON OUR STANDARD OF REVIEW, WE CANNOT CONCLUDE THAT
NIDA'S EXCLUSION OF COTTON FROM THE COMPETITIVE RANGE WAS UNREASONABLE
OR IMPROPER.
AFTER THE INITIAL TECHNICAL REVIEW, COTTON WAS ASKED TO SUBMIT
CLARIFYING INFORMATION COVERING SEVERAL AREAS, INCLUDING THE EXPERIENCE
OF ITS PROPOSED STAFF AND SPECIAL CONSULTANTS. WHILE THIS INFORMATION
WAS FOUND SUFFICIENT TO INCREASE COTTON'S SCORE SIGNIFICANTLY, THE
EVALUATORS AND THE CONTRACTING OFFICER STILL CONSIDERED COTTON WEAK IN
EXPERIENCE. THIS WEAKNESS REPORTEDLY ACCOUNTED IN LARGE PART FOR THE
DISPARITY BETWEEN COTTON'S FINAL SCORE OF 92.4 AND BIRNBAUM'S SCORE OF
97.4. AT THIS POINT, THE CONTRACTING OFFICER, BASED ON THE COMPETITION
AVAILABLE IN THIS PROCUREMENT (I.E., BIRNBAUM'S SUPERIOR PROPOSAL),
DECIDED THAT ON A RELATIVE SCALE COTTON AND THE OTHER LOWER OFFERORS
WERE NOT IN THE COMPETITIVE RANGE. WE HAVE APPROVED THIS "RELATIVE"
APPROACH TO DETERMINING THE COMPETITIVE RANGE BASED UPON THE SCORES
OBTAINED BY THE OFFERORS. SEE ART ANDERSON ASSOCIATES, SUPRA. THE
RECORD ADEQUATELY SUPPORTS NIDA'S CONCLUSION THAT, CONSIDERING THE
STRENGTH OF BIRNBAUM'S PROPOSAL, COTTON NO LONGER STOOD A REASONABLE
CHANCE OF RECEIVING THE AWARD.
SINCE BY ITS NATURE THE REQUIRED EXPERIENCE HAD TO HAVE BEEN
ACCUMULATED PRIOR TO THIS PROCUREMENT, WE AGREE WITH NIDA'S APPARENT
DETERMINATION THAT COTTON'S RATING IN THIS AREA COULD NOT BE EXPECTED TO
BE IMPROVED IN A BEST AND FINAL OFFER. WE NOTE THAT COTTON DOES NOT
INDICATE HOW, OR WHETHER, IT PLANNED TO UPGRADE ITS PROPOSAL IN THIS
AREA. SIMILARLY, SINCE COTTON'S PROPOSED COST WAS 10 PERCENT HIGHER
THAN BIRNBAUM'S AND BOTH PROPOSALS ALREADY WERE SUBSTANTIALLY LOWER THAN
NIDA'S ESTIMATE OF $98,601, WE BELIEVE NIDA REASONABLY DETERMINED THAT
COTTON COULD NOT REDUCE ITS COST SUFFICIENTLY TO OFFSET BIRNBAUM'S
TECHNICAL ADVANTAGE. AGAIN, COTTON DOES NOT SPECIFICALLY STATE
OTHERWISE. IN ANY EVENT, ESTIMATED COSTS ARE NOT CONTROLLING IN
SELECTING A CONTRACTOR FOR A COST-REIMBURSEMENT TYPE CONTRACT. SEE
FEDERAL PROCUREMENT REGULATIONS SEC. 1-3.805-2.
THE PROTEST IS DENIED.
FN1 THERE IS NO INDICATION THAT ANY CHANGES WERE MADE IN THE COST
PROPOSALS.
B-210848, JUN 28, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
REVELATION OF THE BID PRICE IN A TELEGRAPHIC MODIFICATION PRIOR TO
BID OPENING, ALTHOUGH CONTRARY TO THE TERMS OF THE SOLICITATION, IS A
WAIVABLE ERROR WHERE NO PROOF OF PREJUDICE TO OTHER BIDDERS IS
PRESENTED.
HALE BUILDING COMPANY, INC.:
HALE BUILDING COMPANY, INC. (HALE), PROTESTS THE AWARD OF A CONTRACT
TO JOHN MORRIS BUILDING SYSTEMS (MORRIS) UNDER INVITATION FOR BIDS (IFB)
NO. DACA01-82-B-0083, ISSUED BY THE UNITED STATES ARMY CORPS OF
ENGINEERS, ON THE GROUND THAT THE MORRIS BID WAS NONRESPONSIVE.
WE DENY THE PROTEST.
THE IFB INCLUDED STANDARD FORM 22 WHICH STATES THAT TELEGRAPHIC
MODIFICATIONS OF BIDS WILL BE CONSIDERED, BUT SHOULD NOT REVEAL THE
AMOUNT OF THE ORIGINAL OR REVISED BID. DESPITE THIS PROVISION, MORRIS
SUBMITTED A TELEGRAPHIC MODIFICATION BEFORE OPENING WHICH REVEALED ITS
REVISED BID PRICE.
HALE PROTESTS THAT REVEALING THE PRICE VIOLATED THE TERMS OF THE
SOLICITATION AND RENDERED THE MORRIS BID NONRESPONSIVE. FURTHER, HALE
ALLEGES THAT ACCEPTANCE OF THE BID PREJUDICED ITSELF AND THE OTHER
BIDDERS ON THIS IFB, WHICH COMPLIED WITH THE SOLICITATION.
THE AGENCY RESPONDS THAT THE REVELATION OF THE BID PRICE WAS A MINOR
IRREGULARITY WHICH IS WAIVABLE SINCE IT DID NOT PREJUDICE THE OTHER
BIDDERS. THE AGENCY DRAWS AN ANALOGY BETWEEN THIS SITUATION AND THE
SUBMISSION OF AN UNSEALED BID, WHICH ORDINARILY IS A WAIVABLE ERROR.
THE TEST OF RESPONSIVENESS IS WHETHER THE BID, AS SUBMITTED, COMPLIES
WITH THE IFB'S MATERIAL PROVISIONS. IF AN IRREGULARITY EXISTS WHICH
RELATES TO AN INCONSEQUENTIAL MATTER, THE AGENCY MUST EITHER WAIVE IT OR
ALLOW THE BIDDER AN OPPORTUNITY TO CURE IT. WFT SERVICE CORP.,
B-206603, AUGUST 31, 1982, 82-2 CPD 190. IN THIS CASE, THE IRREGULARITY
WAS MORRIS' FAILURE TO PROTECT ITS BID PRICE FROM BEING REVEALED PRIOR
TO OPENING. WE AGREE WITH THE AGENCY THAT THIS FAILURE IS SIMILAR TO
SUBMITTING AN UNSEALED BID. THEREFORE, THE ERROR IS INCONSEQUENTIAL AND
SHOULD BE WAIVED UNLESS THERE IS EVIDENCE OF COMPETITIVE PREJUDICE TO
THE OTHER BIDDERS. RYAN-WALSH STEVEDORING COMPANY, INC., B-182039, MARCH
5, 1975, 75-1 CPD 129. THE PRESENT CASE DOES NOT INCLUDE ANY EVIDENCE
OF THIS TYPE OF PREJUDICE.
PROTEST DENIED.
B-210846, MAR 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
AWARD OF A CONTRACT TO SUPPLY ORIENTAL RUGS TO THE ARMY AND AIR FORCE
EXCHANGE SYSTEM WHICH DOES NOT INVOLVE APPROPRIATED FUNDS IS NOT SUBJECT
TO GAO REVIEW.
CONUSSTAN PRODUCTS, WEST GERMANY:
CONUSSTAN PRODUCTS, WEST GERMANY (CONUSSTAN), PROTESTS THE AWARD OF
AN ORIENTAL RUG CONCESSION CONTRACT TO TURKAS BY THE DEPARTMENT OF THE
ARMY UNDER SOLICITATION NO. AAFES-EUR-82-43-82-27. CONUSSTAN CHALLENGES
THE RESPONSIBILITY OF TURKAS AND ALLEGES THAT THERE WERE NUMEROUS
MISREPRESENTATIONS AND IRREGULARITIES IN THE CONDUCT OF THE PROCUREMENT
AND AWARD IN QUESTION.
WE DISMISS THE PROTEST.
THIS OFFICE CONSIDERS ONLY PROTESTS OF CONTRACT AWARDS PURSUANT TO
ITS AUTHORITY UNDER PUB.L. NO. 97-258, SEC. 3526, 96 STAT. 964 (1982)
(TO BE CODIFIED AT 31 U.S.C. SEC. 3526, FORMERLY 31 U.S.C. SECS. 71, 74
(1976)), TO SETTLE APPROPRIATED FUND ACCOUNTS OF THE GOVERNMENT.
CONSEQUENTLY, WE GENERALLY CONSIDER PROTESTS OF CONTRACT AWARDS WHICH
INVOLVE THE EXPENDITURE OF APPROPRIATED FUNDS. TENAVISION, INC.,
B-208383, AUGUST 18, 1982, 82-2 CPD 153.
IN THIS CASE, THE PROCUREMENT IS FOR THE ARMY AND AIR FORCE EXCHANGE
SYSTEM, A NONAPPROPRIATED FUND ACTIVITY. SINCE THE AWARD OF THIS
CONTRACT DOES NOT INVOLVE THE DIRECT EXPENDITURE OF APPROPRIATED FUNDS,
OUR OFFICE COULD NOT TAKE LEGAL EXCEPTION TO THE AWARD; THEREFORE, NO
USEFUL PURPOSE WOULD BE SERVED BY OUR REVIEW.
B-210844, AUG 2, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHETHER TECHNICAL POINT SPREAD BETWEEN TWO
COMPETING PROPOSALS INDICATES SUPERIORITY
OF ONE PROPOSAL OVER ANOTHER TO JUSTIFY
AWARD AT A HIGHER COST DEPENDS ON THE FACTS
AND CIRCUMSTANCES OF EACH CASE AND IS PRIMARILY
A MATTER WITHIN THE DISCRETION OF
THE PROCURING AGENCY. ALLEGATION THAT PROPOSALS
SHOULD HAVE BEEN CONSIDERED ESSENTIALLY
EQUAL TECHNICALLY THUS MAKING COST
THE DETERMINATIVE AWARD FACTOR IS WITHOUT
MERIT WHERE THE AGENCY REASONABLY FOUND
THAT THE PROPOSAL RATED 6.25 POINTS (OUT OF
100) HIGHER TECHNICALLY WAS SUPERIOR TO THE
PROTESTER'S LOWER-COST PROPOSAL, AND THE
RFP STATED THAT TECHNICAL QUALITY WAS MORE
IMPORTANT THAN COST.
MIDWEST RESEARCH INSTITUTE:
MIDWEST RESEARCH INSTITUTE PROTESTS THE AWARD OF A COST-REIMBURSEMENT
CONTRACT TO BATTELLE COLUMBUS LABORATORIES UNDER REQUEST FOR PROPOSALS
(RFP) NO. CI 82-0873 ISSUED BY THE ENVIRONMENTAL PROTECTION AGENCY
(EPA). THE RFP SOLICITED PROPOSALS FOR THE EVALUATION AND IMPROVEMENT
OF TESTING METHODS FOR MEASURING ORGANIC POLLUTANTS IN THE ENVIRONMENT.
THE PROTESTER CONTENDS THAT EPA IMPROPERLY AWARDED THE CONTRACT TO A
HIGHER-COST OFFEROR WHOSE PROPOSAL WAS ESSENTIALLY EQUAL TO THE
PROTESTER'S FROM A TECHNICAL STANDPOINT. WE DENY THE PROTEST.
THE RFP STATED THAT WHILE BOTH TECHNICAL QUALITY AND COST WOULD BE
CONSIDERED IN SELECTING A CONTRACTOR, TECHNICAL QUALITY WAS MORE
IMPORTANT THAN COST, AND AS PROPOSALS BECAME MORE EQUAL IN THEIR
TECHNICAL MERIT, THE EVALUATED COST WOULD BECOME MORE IMPORTANT.
THE TECHNICAL SCORES AND COSTS PROPOSED BY THE THREE FIRMS WITH THE
HIGHEST TECHNICAL SCORES (THE OTHER FOUR OFFERORS WERE NOT INCLUDED IN
THE COMPETITIVE RANGE) WERE:
TECHNICAL SCORE COST
BATTELLE 82.50 $1,596,147
MIDWEST 76.25 $1,514,836
RADIAN CORPORATION 76.25 $1,543,521
THE AWARD WAS MADE TO BATTELLE AS THE HIGHEST TECHNICALLY RATED OFFEROR
ON THE BASIS THAT ITS TECHNICAL SUPERIORITY OUTWEIGHED ANY POTENTIAL
COST BENEFITS OFFERED BY THE LOWER-COST FIRMS.
MIDWEST CONTENDS THAT BECAUSE THE TECHNICAL SCORES OF THE THREE
HIGHEST RATED PROPOSALS WERE SO CLOSE, THOSE PROPOSALS MUST HAVE BEEN
TECHNICALLY EQUAL AND, ACCORDING TO THE EVALUATION CRITERIA, AWARD
SHOULD HAVE BEEN MADE TO MIDWEST AS THE LOWEST-COST OFFEROR. WHILE
MIDWEST DOES NOT CHALLENGE THE ACTUAL TECHNICAL SCORING, THE FIRM ARGUES
THAT NUMERICAL SCORES AWARDED BY AN AGENCY IN THE TECHNICAL EVALUATION
OF PROPOSALS MERELY REFLECT AN ATTEMPT TO QUANTIFY AN ESSENTIALLY
SUBJECTIVE JUDGMENT AND SHOULD NOT BE USED AS THE ABSOLUTE DETERMINANT
OF WHICH FIRM RECEIVES THE CONTRACT AWARD. MIDWEST ALSO SUGGESTS THAT
THE EVALUATORS COULD NOT HAVE FOUND A SIGNIFICANT DIFFERENCE AMONG THE
TECHNICAL PROPOSALS SINCE EPA IN FACT NEGOTIATED WITH ALL THREE FIRMS.
IN SUPPORT OF ITS POSITION THAT ITS PROPOSAL WAS MOST ADVANTAGEOUS TO
THE GOVERNMENT, MIDWEST POINTS TO A TECHNICAL/COST RATIO THAT EPA
DEVELOPED AS AN AID IN ANALYZING THE PROPOSALS. THE RESULTS OBTAINED BY
EPA WERE AS FOLLOWS:
TECHNICAL/COST RATIO MIDWEST BATTELLE
50/50 88.13 88.70
60/40 85.75 87.46
70/30 83.38 86.22
EPA USED THIS ANALYSIS TO SHOW THAT BATTELLE'S OFFER IS THE MOST
ADVANTAGEOUS EVEN IF MIDWEST'S LOWER COST IS CONSIDERED AS IMPORTANT AS
BATTELLE'S TECHNICAL SUPERIORITY. MIDWEST, HOWEVER, ASSERTS THAT THIS
ANALYSIS DOES NOT INCLUDE CONSIDERATION OF A $26,000 COST REDUCTION
OFFERED BY MIDWEST IN RESPONSE TO AN AGENCY REQUEST AFTER BEST AND FINAL
OFFERS FOR CONFIRMATION OF CONTINUED AVAILABILITY OF CERTAIN KEY
PERSONNEL NAMED IN THE OFFERORS' PROPOSALS. ACCORDING TO THE PROTESTER,
CONSIDERATION OF ITS COST REDUCTION PROPOSAL RESULTS IN ITS PROPOSAL
BEING RATED HIGHER THAN BATTELLE'S PROPOSAL UNDER EPA'S ANALYSIS IF A
50/50 OR 51/49 TECHNICAL/COST RATIO IS EMPLOYED.
IT IS PRECISELY BECAUSE POINT SCORES ARE OFTEN THE COMPOSITE RESULT
OF DISPARATE JUDGMENTS OF TECHNICAL EVALUATORS THAT WE HAVE HELD THAT
POINT RATINGS, WHILE USEFUL AS GUIDES FOR INTELLIGENT DECISION-MAKING,
SHOULD NOT IN EVERY CASE DETERMINE THE OUTCOME OF THE EVALUATION.
BUNKER RAMO CORPORATION, 56 COMP.GEN. 712, 716 (1977), 77-1 CPD 427;
WHEELER INDUSTRIES, INC., B-193883, JULY 20, 1979, 79-2 CPD 41. WHETHER
A GIVEN POINT SPREAD BETWEEN COMPETING PROPOSALS INDICATES A SIGNIFICANT
SUPERIORITY OF ONE OVER ANOTHER, HOWEVER, IS A MATTER PRIMARILY WITHIN
THE DISCRETION OF THE CONTRACTING AGENCY. GREY ADVERTISING, INC., 55
COMP.GEN. 1111 (1976), 76-1 CPD 325. THUS, WE HAVE UPHELD AN AWARD TO A
HIGHER-COST PROPOSAL JUDGED TECHNICALLY SUPERIOR BY THE CONTRACTING
AGENCY DESPITE A TECHNICAL POINT SCORE SPREAD OF ONLY THREE POINTS. 52
COMP.GEN. 358 (1972); SEE ALSO BELLMORE JOHNSON TOOL COMPANY, B-179030,
JANUARY 24, 1974, 74-1 CPD 26, WHERE THE HIGHER COST PROPOSAL WAS RATED
ONLY FOUR POINTS HIGHER THAN THE LOW-COST OFFEROR BUT NEVERTHELESS
PROPERLY WAS FOUND TO BE TECHNICALLY SUPERIOR AND ACCEPTED.
THE PROTESTER HAS OFFERED NO SUPPORT FOR ITS POSITION, EXCEPT FOR ITS
RELIANCE ON THE CLOSE POINT SPREAD (76.25 POINTS TO 82.50 POINTS), THAT
ITS PROPOSAL IS TECHNICALLY EQUAL TO THAT SUBMITTED BY BATTELLE. ON THE
OTHER HAND, THE RECORD INDICATES THAT EPA VIEWED BATTELLE'S PROPOSAL AND
HIGHER TECHNICAL RATING AS REFLECTING A TECHNICAL SUPERIORITY THAT
OUTWEIGHED ANY POTENTIAL COST BENEFIT OF ACCEPTING MIDWEST'S PROPOSAL.
FOR EXAMPLE, THE CONTRACTING OFFICER STATES THAT, IN HIS JUDGMENT,
BATTELLE'S TECHNICAL PROPOSAL CLEARLY DEMONSTRATED A SUPERIOR
UNDERSTANDING OF EPA REGULATORY AND MONITORING REQUIREMENTS. THE RFP
ADVISED OFFERORS THAT TECHNICAL QUALITY WAS MORE IMPORTANT THAN COST,
AND MIDWEST'S BARE DISAGREEMENT WITH THE SIGNIFICANCE OF THE DIFFERENCE
IN TECHNICAL SCORES PROVIDES NO LEGAL BASIS FOR OUR OFFICE TO QUESTION
THE CONTRACTING AGENCY'S JUDGMENT THAT BATTELLE'S 8-PERCENT HIGHER
TECHNICAL SCORE INDICATES A TECHNICAL SUPERIORITY WORTH THE 5-PERCENT
EXTRA COST ASSOCIATED WITH THE PROPOSAL.
AS TO THE RESULTS OF EPA'S TECHNICAL/COST ANALYSIS IF MIDWEST'S
$26,000 COST REDUCTION IS CONSIDERED, WE FIRST NOTE THAT THE FIRM
SUBMITTED THE REDUCTION AFTER BEST AND FINAL OFFERS, SO THAT IT COULD
NOT BE CONSIDERED IN THE SELECTION DECISION, SEE REAL FRESH, INC.,
B-204604, DECEMBER 31, 1981, 81-2 CPD 522 (ALTHOUGH THE RECORD SHOWS
THAT EPA DID ANALYZE THE REDUCED-COST OFFER THE SAME WAY IT ANALYZED THE
BEST AND FINAL OFFERS). IN ANY EVENT, MIDWEST'S SHOWING THAT WITH THE
$26,000 REDUCTION ITS OFFER IS MORE ADVANTAGEOUS THAN BATTELLE'S OFFER
IF TECHNICAL QUALITY AND COST ARE CONSIDERED ALMOST EQUAL DOES NOT MAKE
THE SELECTION OF BATTELLE WRONG. THE REASON IS THAT THE RFP CLEARLY
ASSIGNED GREATER WEIGHT TO TECHNICAL FACTORS, AND IN THAT CASE COST
GENERALLY BECOMES THE DETERMINATIVE FACTOR ONLY IF, UNLIKE HERE, THE
AGENCY FINDS THAT THE TECHNICAL PROPOSALS ARE ESSENTIALLY EQUAL. SEE
APPLIED FINANCIAL ANALYSIS, LTD., B-194388.2, AUGUST 10, 1979, 79-2 CPD
113. AS STATED ABOVE, THE RECORD DOES NOT SUPPORT MIDWEST'S CONTENTION,
WHICH IS BASED ONLY ON THE 6.25 POINT TECHNICAL SCORE DIFFERENCE, THAT
THE PROPOSALS WERE ESSENTIALLY EQUAL TECHNICALLY.
IN OUR VIEW EPA REASONABLY JUDGED BATTELLE'S PROPOSALS MORE
ADVANTAGEOUS TO THE GOVERNMENT DESPITE ITS HIGHER COST, A JUDGMENT THAT
CONFORMED TO THE RFP'S EVALUATION SCHEME. CONSEQUENTLY, WE REJECT
MIDWEST'S ARGUMENT THAT IT SHOULD HAVE RECEIVED THE AWARD BASED ON ITS
LOWER COST. THE PROTEST IS DENIED.
B-210843, JUL 6, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST AGAINST SPECIALTY METALS CLAUSE IN INVITATION FOR BIDS IS
DISMISSED AS UNTIMELY SINCE IT WAS FILED AFTER BID OPENING.
2. BID TO SUPPLY PRODUCT (COMPONENT OF A WEAPON OR WEAPONS SYSTEM)
MADE OF FOREIGN SPECIALTY METAL WAS PROPERLY REJECTED FOR NOT COMPLYING
WITH THE PREFERENCE FOR DOMESTIC SPECIALTY METALS CLAUSE IN THE
SOLICITATION WHERE CLAUSE IS BASED ON LAW WHICH AGENCY REASONABLY
INTERPRETS AS PERMITTING EXCEPTION TO CLAUSE FOR WEAPON OR WEAPONS
SYSTEM, NOT COMPONENTS THEREOF.
URDAN INDUSTRIES, LTD.:
URDAN INDUSTRIES, LTD. (URDAN), PROTESTS THE REJECTION OF ITS LOW BID
AS NONRESPONSIVE BY THE DEPARTMENT OF THE ARMY (ARMY) UNDER INVITATION
FOR BIDS (IFB) NO. DAAE07-82-B-8572, FOR AIR INLET SHIELDS, A PART USED
ON THE M88A1 MILITARY VEHICLE.
THE SPECIALTY METALS CLAUSE, DEFENSE ACQUISITION REGULATION (DAR)
SEC. 7-104.93(A) (1976 ED.), WAS INCLUDED IN THIS IFB. UNDER THIS
CLAUSE, THE CONTRACTOR AGREES THAT ANY SPECIALTY METALS INCORPORATED IN
ARTICLES DELIVERED UNDER THE CONTRACT WILL BE MELTED IN THE UNITED
STATES. HOWEVER, PARAGRAPH (D) OF THIS CLAUSE ALSO PROVIDES THAT:
"NOTHING IN THIS PROVISION SHALL PRECLUDE THE
PROCUREMENT OF FOREIGN PRODUCED SPECIALTY
METALS USED IN THE PRODUCTION OR MANUFACTURE OF
WEAPONS OR WEAPONS SYSTEMS MADE OUTSIDE THE
U.S. *** IF SUCH PROCUREMENT IS NECESSARY TO
COMPLY WITH AGREEMENTS WITH FOREIGN
GOVERNMENTS."
URDAN CERTIFIED THAT ITS PRODUCT WAS 100-PERCENT FOREIGN CONTENT.
THE ARMY ASSERTS THAT SINCE THIS PROCUREMENT IS FOR A COMPONENT RATHER
THAN A COMPLETE WEAPON OR WEAPONS SYSTEM IT IS NOT WITHIN THE PARAGRAPH
(D) EXCEPTION FOR FOREIGN-PRODUCED SPECIALTY METALS. THEREFORE, URDAN
WAS DETERMINED NONRESPONSIVE BECAUSE IT OFFERED A PRODUCT WITH FOREIGN
SPECIALTY METALS. AWARD WAS MADE TO BMY, DIVISION OF HARSCO
CORPORATION, THE SECOND LOW BIDDER.
URDAN CONTENDS THAT PARAGRAPH (D), ADDED TO THE SPECIALTY METALS
CLAUSE TO IMPLEMENT THE CONTINUING APPROPRIATIONS FOR FISCAL YEAR 1983,
PUB.L. 97-276 SEC. 101(C), 96 STAT. 1187 (1982), FOR THE DEPARTMENT OF
DEFENSE (DOD), ALSO PERMITS THE PROCUREMENT OF PARTS OR COMPONENTS OF
WEAPONS OR WEAPONS SYSTEMS CONTAINING FOREIGN SPECIALTY METALS. URDAN
ARGUES THAT THE LEGISLATIVE HISTORY IS UNCLEAR CONCERNING CONGRESSIONAL
INTENT AND RELIES UPON GENERAL RULES OF INTERPRETATION. URDAN ALSO
QUESTIONS WHETHER THE CLAUSE WAS PROPERLY USED IN THIS IFB BECAUSE THE
CLAUSE ALLEGEDLY WAS NOT APPLICABLE TO THE FUNDS USED FOR THIS
PROCUREMENT.
THE PROTEST IS DISMISSED IN PART AND DENIED IN PART.
URDAN'S CONTENTION THAT THE DAR CLAUSE WAS NOT REQUIRED TO BE
INCORPORATED INTO THE IFB RELATES TO AN IMPROPRIETY APPARENT FROM THE
FACE OF THE IFB. THEREFORE, URDAN'S FAILURE TO PROTEST THE IFB
PROVISION BEFORE BID OPENING BARS CONSIDERATION OF THAT ISSUE AS
UNTIMELY, 4 C.F.R. SEC. 21(B)(1) (1983).
WITH RESPECT TO THE REJECTION OF URDAN'S BID, THE PRIMARY SUPPORT FOR
THE ARMY'S POSITION THAT "WEAPONS OR WEAPONS SYSTEMS" DOES NOT COVER
PARTS AND COMPONENTS IS THE RECORD OF THE UNITED STATES SENATE ON
DECEMBER 18, 1982. SENATOR TOWER PROPOSED AMENDMENT 1517 TO THE
CONTINUING APPROPRIATIONS FOR FISCAL YEAR 1983, PUB.L. 97-377 SEC. 723,
96 STAT. 1854 (1983). THIS AMENDMENT WOULD HAVE CHANGED THE LANGUAGE OF
PUB.L. 97-276, WHICH REFERRED TO "WEAPONS OR WEAPONS SYSTEMS," TO "PARTS
OR COMPONENTS OF DEFENSE ITEMS."
IN THE DISCUSSION CONCERNING THIS AMENDMENT, SENATOR TOWER STATED:
"THE LANGUAGE IN SEC. 2951 ALLOWS DOD TO PURCHASE
ONLY 'WEAPONS OR WEAPONS SYSTEMS' MANUFACTURED
OUTSIDE THE UNITED STATES AND CONTAINING SPECIALTY
METALS OF NON-U.S. ORIGIN. HOWEVER,
THE UNITED STATES DOES NOT BUY WEAPONS OR
WEAPONS SYSTEMS FROM OVERSEAS. FOR THE MOST
PART, WE PURCHASE FOREIGN MADE COMPONENTS, SUB-ASSEMBLIES,
AND DEFENSE EQUIPMENT FROM OUR EUROPEAN ALLIES.
UNDER THE PROVISION OF SEC. 2951, DOD WOULD BE PROHIBITED
FROM BUYING SUCH ITEMS.
"THE AMENDMENT WE PROPOSE WILL ALLOW DOD TO
PURCHASE DEFENSE ITEMS, AND PARTS AND COMPONENTS
OF DEFENSE ITEMS WHICH ARE MANUFACTURED OUTSIDE
THE UNITED STATES."
THE AMENDMENT WAS NOT ADOPTED, AND THE FINAL LEGISLATION WAS PASSED WITH
ESSENTIALLY THE IDENTICAL LANGUAGE CONTAINED IN THE PREDECESSOR
LEGISLATION, PUB.L. 97-276, WHICH CONTAINED THE "WEAPONS OR WEAPONS
SYSTEMS" LANGUAGE.
THE ARMY CONCLUDES THAT THIS REFLECTS THE CONGRESSIONAL INTENT AND
UNDERSTANDING WITH RESPECT TO THE MEANING OF THE WORDS "WEAPONS OR
WEAPONS SYSTEMS" AS NOT INCLUDING COMPONENTS AND PARTS OF DEFENSE ITEMS.
THE ARMY FURTHER ASSERTS THAT IF SUCH PARTS OR COMPONENTS OF DEFENSE
ITEMS WERE DEEMED TO BE PART OF THE DEFINITION OF "WEAPONS OR WEAPONS
SYSTEMS," THERE WOULD HAVE BEEN NO NEED FOR SENATOR TOWER'S PROPOSED
AMENDMENT.
THE ARMY ALSO NOTES THAT THE SENATE REPORT, NO. 97-580, 97TH CONG.,
2ND. SESS. 148 (1982), TO THE DOD APPROPRIATION BILL, 1983, S. 2951,
INDICATES THAT THE GENERAL SPECIALTY METALS RESTRICTION WAS INTENDED TO
RESTORE PROTECTION FOR DOMESTIC INDUSTRY THAT HAD BEEN REMOVED IN
PREVIOUS APPROPRIATION ACTS. THE REPORT ALSO STATES THAT, "THE NEW
EXCEPTION TO THE BUY AMERICAN PROVISIONS OF THE BILL PERMITS PURCHASES
OF FOREIGN SPECIALTY METALS WHEN USED IN FOREIGN MANUFACTURED WEAPONS
SYSTEMS."
OTHER THAN TO ARGUE THAT WE SHOULD NOT RELY ON THE SENATE PROCEEDINGS
SINCE IT IS PRIMARILY THE OPINION OF ONE LEGISLATOR, URDAN OFFERS NO
LEGISLATIVE HISTORY THAT CONTRADICTS THE ARMY'S INTERPRETATION OF THE
LAW. IN THE ABSENCE OF ANY CONTRARY INDICATIONS IN MORE AUTHORITATIVE
PORTIONS OF LEGISLATIVE HISTORY SUCH AS COMMITTEE REPORTS, WE CONCLUDE
THAT SENATOR TOWER'S STATEMENT, ON BEHALF OF NINE COSPONSORS, SHOWED
THAT THE PROPOSED AMENDMENT WAS NECESSARY TO PURCHASE COMPONENTS OF
DEFENSE EQUIPMENT CONTAINING SPECIALTY METALS OF FOREIGN ORIGIN AND IT
WAS NOT SUGGESTED THAT THE EXISTING LANGUAGE ALREADY ACCOMPLISHED THIS
PURPOSE. UNDER THESE CIRCUMSTANCES, WE CONCUR WITH THE ARMY'S POSITION
THAT THE EXCEPTION PERMITTING FOREIGN CONTENT PURCHASES DOES NOT EXTEND
TO COMPONENTS AND PARTS. SEE APPLICABILITY OF DEPOSITORY LIBRARY ACT TO
NATIONAL TECHNICAL INFORMATION SERVICE PUBLICATIONS, B-114829, JUNE 27,
1975.
URDAN CONTENDS THAT ARMY REGULATION 310-25 (MORE PRECISELY JOINT
CHIEFS OF STAFF (JCS) PUBLICATION 1), A DICTIONARY OF MILITARY TERMS AND
A LETTER WHICH URDAN ASSERTS IS THE ASSESSMENT OF THE UNDER SECRETARY OF
DEFENSE FOR RESEARCH AND DEVELOPMENT OF THE SPECIALTY METALS STATUTORY
RESTRICTION SUPPORT THE VIEW THAT DOD OFFICIALLY AGREES THAT WEAPONS AND
WEAPONS SYSTEMS COVER COMPONENTS AND PARTS. HOWEVER, AS THE ARMY POINTS
OUT, WHILE JCS PUBLICATION 1 DEFINES WEAPONS SYSTEMS AS "A WEAPON AND
THOSE COMPONENTS REQUIRED FOR ITS OPERATION," IT ALSO ADVISES
PARENTHETICALLY THAT "(THE TERM IS NOT PRECISE UNLESS SPECIFIC
PARAMETERS ARE ESTABLISHED)" AND, THUS, DOES NOT, BY ITSELF, CONSTITUTE
A PRECISE DEFINITION. ALSO, IT IS NOT CLEAR THAT THIS DEFINITION WOULD
BE BINDING ON THE ARMY IN INTERPRETING THE DAR PROVISION.
THE DOD DOCUMENT WHICH URDAN CITES ON ITS BEHALF, ENTITLED
"ASSESSMENT OF FY83 'SPECIALTY METALS' APPROPRIATION RESTRICTION,"
STATES, IN ESSENCE, THAT DOD WAS UNCERTAIN AS TO THE EFFECT OF THE
PROVISION ON THE PURCHASE OF THE COMPONENTS AND PARTS, THAT A REASONABLE
INTERPRETATION IS THAT A PROVISION ALLOWING PURCHASE OF A WEAPONS SYSTEM
ABROAD WOULD ALSO EXTEND TO ITS SPARE PARTS, BUT THAT DOD'S GENERAL
COUNSEL SHOULD BE ASKED TO PROVIDE LEGAL ADVICE AS TO THE PROPER
INTERPRETATION OF THE SPECIALTY METALS PROVISION. THIS DOCUMENT DOES
NOT APPEAR TO CONSTITUTE A DOD POLICY STATEMENT AND, IN FACT, REFERS THE
ISSUE OF THE PROVISION'S MEANING TO THE GENERAL COUNSEL. THUS, NEITHER
THE ARMY REGULATION NOR ASSESSMENT DOCUMENT PROVIDES ANY EVIDENCE WHICH
WOULD REFUTE THE REASONABLENESS OF THE ARMY'S POSITION UNDER THIS
PROCUREMENT.
FURTHER, WE ARE RELUCTANT TO QUESTION THE ARMY'S INTERPRETATION OF
THE CLAUSE BASED ON LAW SINCE IT IS SIGNIFICANTLY RESPONSIBLE FOR
ENFORCEMENT OF THAT LAW. SEE COLORADO STATE UNIVERSITY, B-194627,
DECEMBER 27, 1979, 79-2 CPD 438.
WE THEREFORE CONCLUDE THAT UNDER THIS IFB, A BIDDER COULD NOT BID A
PRODUCT CONTAINING FOREIGN SPECIALTY METALS. URDAN'S CERTIFICATION THAT
ITS PRODUCT REPRESENTED 100-PERCENT FOREIGN CONTENT WAS CONTRARY TO THE
DOMESTIC SPECIALTY METALS CLAUSE AND RENDERED URDAN'S BID NONRESPONSIVE.
SEE E.MILTENBERG, INC., B-207346, NOVEMBER 29, 1982, 82-2 CPD 479.
WE DENY THE PROTEST IN PART AND DISMISS THE PROTEST IN PART.
B-210837, MAR 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO DOES NOT CONSIDER WHETHER BIDDER IS MANUFACTURER OR REGULAR
DEALER UNDER WALSH-HEALEY ACT SINCE BY LAW THAT IS FOR DETERMINATION BY
CONTRACTING AGENCY SUBJECT TO REVIEW BY THE SECRETARY OF LABOR AND BY
THE SMALL BUSINESS ADMINISTRATION WHEN A SMALL BUSINESS IS INVOLVED.
NASCO PRODUCTS COMPANY:
NASCO PRODUCTS COMPANY (NASCO) PROTESTS THE AWARD MADE TO KESSEL
KITCHEN EQUIPMENT CO., INC., BY THE DEFENSE LOGISTICS AGENCY (DLA) UNDER
INVITATION FOR BIDS NO. DLA400-82-B-4643. NASCO ASSERTS THAT IT WAS THE
LOW BIDDER FOR CERTAIN ITEMS UNDER THIS SOLICITATION, BUT THAT DLA
REJECTED ITS BID BECAUSE IT BELIEVED NASCO DID NOT QUALIFY AS A REGULAR
DEALER UNDER THE WALSH-HEALEY ACT, 41 U.S.C. SEC. 35-45 (1976). WE
DISMISS THE PROTEST.
THE QUESTION OF WHETHER A BIDDER IS A MANUFACTURER OR REGULAR DEALER
UNDER THE WALSH-HEALEY ACT MUST BE DETERMINED IN THE FIRST INSTANCE BY
THE CONTRACTING AGENCY, SUBJECT TO FINAL REVIEW BY THE SECRETARY OF
LABOR. IN THE EVENT THAT THE BIDDER IS A SMALL BUSINESS CONCERN, AS
NASCO CLAIMS TO BE, AND THE CONTRACTING OFFICER DETERMINES IT NOT TO BE
A MANUFACTURER OR REGULAR DEALER UNDER THE WALSH-HEALEY ACT, THE MATTER
MUST BE REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR REVIEW,
WHICH MAY EITHER CERTIFY THE SMALL BUSINESS CONCERN TO BE ELIGIBLE FOR
AWARD OR FORWARD THE MATTER TO THE SECRETARY OF LABOR FOR FINAL
DISPOSITION. 15 U.S.C. SEC. 637(B)(7)(B) (SUPP. IV 1980). WE
UNDERSTAND DLA HAS REFERRED THE MATTER TO SBA. THERFORE, WE CANNOT
CONSIDER THE MATTER. SPACE CORPORATION, B-192928, SEPTEMBER 27, 1978,
78-2 CPD 240; SUNAIR ELECTRONICS, INC., B-208385, AUGUST 18, 1982, 82-2
CPD 154.
THE PROTEST IS DISMISSED.
B-210836, OCT 25, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST AGAINST NONCOMPETITIVE AWARD PRESENTS
SIGNIFICANT ISSUE AND WARRANTS CONSIDERATION UNDER GAO BID PROTEST
PROCEDURES, 4 C.F.R. SEC. 21.2(C) (1983), WHERE RECORD INDICATES
APPARENT IMPROPRIETY IN AGENCY'S SOLE-SOURCE AWARD.
2. AGENCY JUSTIFICATION FOR SOLE-SOURCE AWARD FOR
ADDITIONAL TELEPHONE CAPABILITY ON BASIS THAT ADDITIONAL TELEPHONE
CAPABILITY WAS URGENTLY NEEDED AND THAT COMPATIBILITY PROBLEMS
BETWEEN NEW AND OLD EQUIPMENT COULD ARISE IF A NEW VENDOR WERE
AWARDED THE CONTRACT IS INADEQUATE IN THE ABSENCE OF A REQUIRED
TIMEFRAME FOR THE NEED AND EVIDENCE THAT THERE WAS ONLY ONE
SOURCE.
ROLM CORPORATION:
ROLM CORPORATION (ROLM) PROTESTS TWO NONCOMPETITIVE ORDERS PLACED BY
THE DEPARTMENT OF THE NAVY (NAVY) WITH THE PACIFIC TELEPHONE AND
TELEGRAPH COMPANY. THE CONTRACTS ARE FOR A 5-YEAR TERM AND ARE FOR THE
EXPANSION AND IMPROVEMENT OF THE ADMINISTRATIVE TELEPHONE FACILITIES AT
THE NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA, AND THE NAVAL REGIONAL
MEDICAL CENTER, OAKLAND, CALIFORNIA. ROLM CONTENDS THAT THE SOLE-SOURCE
AWARDS WERE IMPROPER AND THAT A COMPETITIVE PROCUREMENT SHOULD BE HELD.
WE SUSTAIN THE PROTEST.
INITIALLY, THE NAVY CONTENDS THAT ROLM'S PROTEST IS UNTIMELY. THE
NAVY INDICATES THAT THE CONTRACT AUTHORIZATION FOR THE REGIONAL MEDICAL
CENTER WAS EXECUTED ON SEPTEMBER 25, 1981, AND FOR THE NAVAL SUPPLY
CENTER, THE AUTHORIZATION WAS EXECUTED ON JANUARY 15, 1982. ROLM'S
LETTER OF PROTEST WAS NOT RECEIVED IN OUR OFFICE UNTIL FEBRUARY 18,
1982, AND THE NAVY CONTENDS THAT ROLM SHOULD HAVE KNOWN THE BASIS FOR
ITS PROTEST FAR SOONER.
ROLM INDICATES THAT IT FIRST LEARNED OF THE NAVY'S ACTIONS ON
FEBRUARY 9, 1983, AND ITS PROTEST WAS FILED WITHIN 10 DAYS AFTER THAT
DATE. ROLM STATES THAT THE PROCUREMENTS WERE NOT PUBLIC NOR WAS THERE
ANY KIND OF NOTICE GIVEN TO POTENTIAL SUPPLIERS THAT THE NAVY WAS
INTERESTED IN PROCURING THESE SERVICES. ROLM CONTENDS THAT IT HAD NO
KNOWLEDGE AND COULD NOT HAVE OBTAINED KNOWLEDGE OF THESE PROCUREMENTS AT
AN EARLIER DATE.
OUR REVIEW OF THE RECORD INDICATES THAT THERE IS NOTHING WHICH
DISPUTES ROLM'S STATEMENT THAT IT LEARNED OF THESE PROCUREMENTS FOR THE
FIRST TIME ON FEBRUARY 9, 1983. IN ANY EVENT, WE WILL CONSIDER THE
PROTEST UNDER THE SIGNIFICANT ISSUE EXCEPTION IN OUR TIMELINESS RULES, 4
C.F.R. SEC. 21.2(C) (1983), SINCE, AS INDICATED BELOW, THE RECORD
DEMONSTRATES AN APPARENT IMPROPRIETY IN THE NAVY'S SOLE-SOURCE AWARD.
SEE AQUALINE ENVIRONMENTAL SERVICES, INCORPORATED, 59 COMP.GEN. 378
(1980), 80-1 CPD 260.
THE NAVY JUSTIFIES THE NONCOMPETITIVE AWARDS TO PACIFIC TELEPHONE ON
TWO GROUNDS. FIRST, THE NAVY CONTENDS THAT THE IMPROVEMENTS AT BOTH
FACILITIES WERE URGENTLY NEEDED AND THAT TIME DID NOT PERMIT A
COMPETITIVE PROCUREMENT. THE NAVY INDICATES THAT BOTH THE NAVAL SUPPLY
CENTER AND THE NAVAL REGIONAL MEDICAL CENTER ARE STRATEGIC FACILITIES
WHICH WERE IN URGENT NEED OF ADDITIONAL TELEPHONE CAPABILITY. THE NAVY
ESTIMATES THAT FORMAL ADVERTISING WOULD HAVE DELAYED THE PROCUREMENT BY
12-18 MONTHS AND, AS A CONSEQUENCE, THE NAVY CONTENDS THAT AWARD ON A
SOLE-SOURCE BASIS WAS ACCEPTABLE. SECOND, THE NAVY ARGUES THAT SINCE
PACIFIC TELEPHONE OWNS OR MAINTAINS ALL OF THE EXISTING TELEPHONE
EQUIPMENT AT THE TWO FACILITIES, COMPATIBILITY PROBLEMS WOULD ARISE
BETWEEN NEW AND EXISTING EQUIPMENT IF A NEW VENDOR WERE AWARDED THE
CONTRACT.
ROLM ARGUES THAT THE NAVY'S ATTEMPT TO ESTABLISH THAT THE
PROCUREMENTS WERE URGENT IS MISLEADING. ROLM CONTENDS THAT THE AWARDS
TO PACIFIC TELEPHONE REPRESENT LONG TERM COMMITMENTS TO NEW TELEPHONE
SYSTEMS RATHER THAN THE UPGRADING OF EXISTING EQUIPMENT PENDING A
COMPETITIVE PROCUREMENT. ROLM ASSERTS THAT THE NAVY MUST HAVE KNOWN AT
A MUCH EARLIER DATE THAT ITS TELEPHONE FACILITIES WERE INADEQUATE AND
SHOULD HAVE PROVIDED FOR A COMPETITIVE PROCUREMENT AT THAT TIME. ROLM
POINTS TO THE FACT THAT A SUBSTANTIAL PERIOD OF TIME HAS ELAPSED BETWEEN
THE AWARD TO PACIFIC TELEPHONE AND THE INSTALLATION OF THE NEW SYSTEM
AND ARGUES THAT THE NAVY COULD HAVE CONDUCTED A COMPETITIVE PROCUREMENT
WITHIN THAT TIME PERIOD. FINALLY, ROLM STATES THAT IT IS THE LARGEST
SUPPLIER OF TELEPHONE EQUIPMENT OF THIS TYPE TO HOSPITALS IN THE COUNTRY
AND CONTENDS THAT THE EQUIPMENT IT OFFERS IS FULLY COMPATIBLE WITH THE
EQUIPMENT ON HAND AT BOTH THE NAVAL SUPPLY CENTER AND THE NAVAL REGIONAL
MEDICAL CENTER. ROLM INDICATES THAT TELEPHONE EQUIPMENT IS REQUIRED TO
BE BUILT TO GOVERNMENT MANDATED SPECIFICATIONS AND THAT THE EQUIPMENT
OFFERED BY ROLM WAS FULLY COMPATIBLE WITH LOCAL BELL SYSTEM EQUIPMENT.
AS A GENERAL MATTER, GOVERNMENT PROCUREMENTS MUST BE CONDUCTED ON A
COMPETITIVE BASIS TO THE MAXIMUM EXTENT PRACTICABLE. THIS REQUIREMENT
APPLIES TO CONTRACT EXTENSIONS AND RENEWALS. SEE FEDERAL DATA
CORPORATION, 59 COMP.GEN. 283 (1980), 80-1 CPD 167. WE HAVE HELD,
HOWEVER, THAT SOLE-SOURCE ACQUISITIONS MAY BE AUTHORIZED WHERE (1) THE
PROCURING AGENCY'S MINIMUM NEEDS CAN BE MET ONLY BY ITEMS OR SERVICES
THAT ARE UNIQUE, (2) TIME IS OF THE ESSENCE AND ONLY ONE KNOWN SOURCE
CAN MEET THE AGENCY'S NEEDS WITHIN THE REQUIRED TIMEFRAME, (3) A
SOLE-SOURCE AWARD IS NECESSARY TO INSURE COMPATIBILITY BETWEEN THE
PROCURED ITEM AND EXISTING EQUIPMENT, OR (4) AN AWARD TO OTHER THAN THE
PROPOSED SOLE-SOURCE CONTRACT WOULD POSE UNACCEPTABLE TECHNICAL RISKS.
CERBERONICS, B-205063, APRIL 14, 1982, 82-1 CPD 345.
BECAUSE COMPETITIVE PROCUREMENTS ARE PREFERRED, OUR OFFICE WILL
SCRUTINIZE CLOSELY A SOLE-SOURCE DETERMINATION. KENT WATKINS AND
ASSOCIATES, INC., B-191078, MAY 17, 1978, 78-1 CPD 377. THE STANDARD WE
APPLY IN DETERMINING THE PROPRIETY OF A SOLE-SOURCE AWARD IS ONE OF
REASONABLENESS, I.E., UNLESS IT CAN BE SHOWN THAT THE CONTRACTING AGENCY
ACTED WITHOUT A REASONABLE BASIS, OUR OFFICE WILL NOT QUESTION THE
DECISION TO PROCURE ON A SOLE-SOURCE BASIS. FEDERAL DATA CORPORATION,
SUPRA.
IN THE PRESENT CASE, WE FIND THAT THE RECORD DOES NOT ADEQUATELY
JUSTIFY A NONCOMPETITIVE AWARD TO PACIFIC TELEPHONE FOR 5 YEARS. THE
NAVY INDICATES THAT A COMPETITIVE PROCUREMENT WAS CONSIDERED. HOWEVER,
DUE TO THE URGENT NEED FOR THE ADDITIONAL EQUIPMENT AND POTENTIAL
COMPATIBILITY PROBLEMS WITH EXISTING EQUIPMENT, IT DECIDED TO AWARD THE
CONTRACT TO THE COMPANY PRESENTLY SERVING THOSE FACILITIES, PACIFIC
TELEPHONE. THE NAVY'S DECISION TO SOLE-SOURCE THE CONTRACT DUE TO THE
URGENT NEED FOR ADDITIONAL TELEPHONE CAPABILITY IS AN UNACCEPTABLE
JUSTIFICATION IN THE ABSENCE OF A REQUIRED TIMEFRAME AND EVIDENCE THAT
THERE WAS ONLY ONE SOURCE. ELECTRONICS SYSTEMS U.S.A., INC., B-200947,
APRIL 22, 1981, 81-1 CPD 309; LAS VEGAS COMMUNICATIONS, INC., B-195966,
JULY 22, 1980, 80-2 CPD 57. ROLM ASSERTS THAT IT COULD SHIP EQUIPMENT
SUCH AS THAT REQUIRED HERE IN 90-120 DAYS, WITH INSTALLATION REQUIRING
AN ADDITIONAL MONTH. WE NOTE THAT THE NAVY HAD NO REQUIRED TIMEFRAME
FOR THE INSTALLATION OF THE EQUIPMENT AND THAT, IF TIME RESTRAINTS
PRECLUDED THE CONDUCT OF A REGULAR COMPETITION, THE NAVY COULD HAVE
CONDUCTED AN EXPEDITED NEGOTIATED PROCUREMENT.
FURTHERMORE, THE RECORD SHOWS THAT THE NAVY MADE NO ATTEMPT TO
ASCERTAIN WHETHER ALTERNATIVE SOURCES COULD MEET ITS NEEDS. THE
SOLE-SOURCE JUSTIFICATION MAKES NO STATEMENT WITH RESPECT TO PACIFIC
TELEPHONE BEING THE ONLY KNOWN SOURCE AND THERE IS NO INDICATION OF ANY
EFFORT TO PUBLICIZE THE REQUIREMENT IN THE COMMERCE BUSINESS DAILY OR
OTHERWISE OR TO CONSIDER ROLM OR OTHER POSSIBLE COMMERCIAL SOURCES.
ALTHOUGH THE NAVY INDICATES THAT THERE WILL BE COMPATIBILITY PROBLEMS IN
A MULTIVENDOR SITUATION, THE NAVY HAS NOT CONVINCINGLY SHOWN THAT OTHER
FIRMS COULD NOT FULFILL ITS NEEDS. SEE ROLM CORPORATION AND FISK
TELEPHONE SYSTEMS, INC., B-202031, AUGUST 26, 1981, 81-2 CPD 180.
FINALLY, WE NOTE THAT THE RECORD DOES NOT ADDRESS THE QUESTION OF WHY
A NONCOMPETITIVE AWARD FOR 5 YEARS WAS NECESSARY. WITH RESPECT TO THE
NAVAL REGIONAL MEDICAL CENTER, THE FINAL BUSINESS CLEARANCE MEMORANDUM
INDICATES THAT THE ADDITIONAL TELEPHONE CAPACITY, WHICH WOULD BE
ADEQUATE FOR THE FORESEEABLE FUTURE, COULD BE INSTALLED WITHIN 32 WEEKS
AFTER AWARD OF THE CONTRACT. THERE IS NOTHING IN THE RECORD WHICH
INDICATES THAT ONLY A 5-YEAR CONTRACT WAS FEASIBLE OR NECESSARY. AS A
CONSEQUENCE, EVEN IF WE HAD FOUND THE INITIAL SOLE SOURCE TO BE PROPER,
WE FAIL TO SEE WHY A CONTRACT OF SHORTER DURATION WAS NOT AWARDED AND A
COMPETITIVE PROCUREMENT BEGUN. SEE ROLM INTERMOUNTAIN CORPORATION,
SUPRA.
UNDER THE CIRCUMSTANCES, WE FIND THAT THE SOLE-SOURCE AWARD WAS NOT
JUSTIFIED. WE BELIEVE THAT PROTECTION OF THE INTEGRITY OF THE
COMPETITIVE PROCUREMENT PROCESS REQUIRES THAT OTHER COMPANIES BE
AFFORDED AN OPPORTUNITY TO COMPETE FOR THIS REQUIREMENT. ACCORDINGLY,
WE RECOMMEND THAT THE NAVY'S REQUIREMENTS BE REPROCURED ON A COMPETITIVE
BASIS AND THAT, IF AN OFFER FROM A COMPANY OTHER THAN PACIFIC TELEPHONE
IS EVALUATED AS MORE ADVANTAGEOUS TO THE GOVERNMENT, THE LEASE OF
PACIFIC TELEPHONE EQUIPMENT BE DISCONTINUED.
THIS DECISION CONTAINS A RECOMMENDATION FOR CORRECTIVE ACTION TO BE
TAKEN. THEREFORE, WE ARE FURNISHING COPIES TO THE SENATE COMMITTEES ON
GOVERNMENTAL AFFAIRS AND APPROPRIATIONS AND THE HOUSE COMMITTEES ON
GOVERNMENT OPERATIONS AND APPROPRIATIONS IN ACCORDANCE WITH SECTION 236
OF THE LEGISLATIVE REORGANIZATION ACT OF 1970, 31 U.S.C. SEC. 720, AS
ADOPTED BY P.L. 97-258, WHICH REQUIRES THE SUBMISSION OF WRITTEN
STATEMENTS BY THE AGENCY TO THE COMMITTEES CONCERNING THE ACTION TAKEN
REGARDING OUR RECOMMENDATION.
B-210833, Nov 9, 1984, 84-2 CPD 517
CONTRACTS - Performance - Adequacy
DIGEST:
State may be reimbursed for payment to contractor pursuant to
National Guard agreement in settlement of claim where state reasonable
concludes that settlement was justified. Prior decision is modified.
Request for Advance Decision form Assistant Comptroller of the Army
for Finance and Accounting -- Reconsideration:
The Army requests reconsideration of our decision Request for Advance
Decision from Assistant Comptroller of the Army for Finance and
Accounting, B-210833, Aug. 4, 1983, 83-2 C.P.D. Para. 170. In that
decision, we held that a voucher in the amount of $7,350, covering the
amount the state of Rhode Island claimed form the federal government as
reimbursement for termination of a snow removal contract at the Air
National Guard (ANG) Base, Quonset State Airport, North Kingstown, Rhode
Island, was not for payment.
Under Rhode Island ANG Operation and Maintenance (O&M) Agreement No.
DAHA-37-82-H-0003, between the National Guard Bureau and the state of
Rhode Island, the federal government was authorized to reimburse the
state of Rhode Island for 75 percent of the expenses incurred in
rendering necessary services and maintenance of certain ANG facilities,
including the above facility. Section 7 of the agreement authorized the
state to contract for the above services, subject to approval by the
United States Property and Fiscal Office (USPFO). Pursuant to this
provision, the state of Rhode Island constructed with the Salo
construction Co. (Salo) to have the snow removed. This contract was
approved by the USPFO as evidenced by payment to Salo for snow removal
in December 1981, made pursuant to sections 3 and 7 of the agreement.
These two sections provide that payment under section 3 of the agreement
constitutes approval of the payment as an authorized charge against the
agreement and, in essence, approval of the agreement. Our decision held
that the contractor was only entitled to be paid for the work actually
performed, valued at $1,670.75.
We modify our decision.
At the time of the initial decision, we assumed that Salo's claim had
not been paid yet by the state. In fact, the state had, pursuant to
legal advice from both the Rhode Island ANG Staff Judge Advocate and
legal counsel for the state of Rhode Island, paid Salo the amount of
$9,800 in settlement for terminating the contract.
The crux of the request for reconsideration is that since payment was
made to Salo prior to our decision by a state official who had the legal
authority to make such payment and the payment represented a reasonable
expense incurred by the state, the state is entitled to reimbursement
under the O&M agreement. The state argues, in essence, that because
Salo's contract was terminated, the state faced a possible breach of
contract suit under which Salo may have recovered the full contract
price ($40,000) and, therefore, settlement of the claim with Salo was a
reasonable alternative to the risk of litigation. We are unable to
conclude that such action was unreasonable under the circumstances. The
voucher may be paid in the amount of $7,350, as submitted. COMP GEN (UP)
B-210831, AUG 2, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
THERE IS NO AUTHORITY TO ALLOW PAYMENT OF
CLAIMS FOR SERVICES AS EXPERT WITNESSES AT
ARMY COURT-MARTIAL PROCEEDING WHERE CLAIMANTS'
SERVICES WERE NOT AUTHORIZED IN
ADVANCE BY THE CONVENING AUTHORITY AS
REQUIRED BY PARAGRAPH 116 OF THE MANUAL
FOR COURTS-MARTIAL. ALSO, THE CLAIMS DO
NOT CONTAIN SUCH ELEMENTS OF UNUSUAL LEGAL
LIABILITY OR EQUITY TO WARRANT THEIR SUBMISSION
TO THE CONGRESS UNDER THE MERITORIOUS
CLAIMS ACT, 31 U.S.C. SEC. 3702(D).
DR. MARTIN BLINDER, ET AL.:
THIS ACTION IS IN RESPONSE TO A SUBMISSION BY MS. ALICE MCCARTY,
CHIEF, FIELD SERVICES DIVISION, OF THE U. S. ARMY FINANCE AND ACCOUNTING
CENTER, INDIANAPOLIS, INDIANA, OF THE CLAIMS OF FOUR INDIVIDUALS FOR
FEES AS EXPERT WITNESSES IN CONNECTION WITH THEIR CONSULTATION SERVICES
AND TESTIMONY INCIDENT TO A COURT-MARTIAL PROCEEDING. THE ARMY ADVISES
THAT THE CLAIMS HAVE NOT BEEN ALLOWED SINCE THE EXPERT WITNESSES WERE
NOT EMPLOYED IN ACCORDANCE WITH THE REQUIRED PROCEDURE SET FORTH AT
PARAGRAPH 116, OF THE MANUAL FOR COURTS-MARTIAL, 1969 (REVISED) AND
SECTION 13-38 OF ARMY REGULATION 37-106. THE ARMY HAS REQUESTED THAT
THE COMPTROLLER GENERAL OF THE UNITED STATES SUBMIT THESE CLAIMS FOR
EXPERT WITNESS FEES TO THE CONGRESS FOR RELIEF UNDER THE MERITORIOUS
CLAIMS ACT OF 1928, NOW CODIFIED AT 31 U.S.C. SEC. 3702(D) (FORMERLY 31
U.S.C. SEC. 236). FOR THE REASONS STATED BELOW, THE CLAIMS DO NOT
PRESENT SUCH ELEMENTS OF LEGAL LIABILITY SO AS TO WARRANT SUBMISSION TO
CONGRESS UNDER THE MERITORIOUS CLAIMS ACT.
IN OCTOBER AND NOVEMBER OF 1981, THE SERVICES OF DRS. MARTIN BLINDER,
ROY R. AUERBACH, JULIAN SILVERMAN AND MR. TERRENCE HICKEY WERE OBTAINED
AS EXPERT PSYCHIATRIC WITNESSES IN THE COURT-MARTIAL PROCEEDINGS IN
UNITED STATES V. KING. DRS. BLINDER, AUERBACH AND SILVERMAN HAVE
SUBMITTED CLAIMS IN THE RESPECTIVE AMOUNTS OF $1,000, $360, AND $750 FOR
THE TOTAL HOURS THEY SPENT ON PSYCHIATRIC CONSULTATION, ACTUAL TESTIMONY
AND RELATED TRAVELTIME. IN ADDITION, DR. SILVERMAN HAS CLAIMED
REIMBURSEMENT FOR TRAVEL BY PRIVATELY OWNED VEHICLE. MR. HICKEY HAS
SUBMITTED A CLAIM IN THE AMOUNT OF $850 WHICH REPRESENTS $300 FOR
CONSULTATION AND ACTUAL TESTIMONY AND $550 FOR REIMBURSEMENT FOR DAYS HE
WAS ABSENT FROM HIS REGULAR EMPLOYMENT AS A RESULT OF HIS ACTIVITIES
ASSOCIATED WITH THE COURT-MARTIAL PROCEEDING.
THE CLAIMANTS WERE CALLED AS EXPERT WITNESSES AT THE DIRECTION OF THE
MILITARY TRIAL JUDGE UPON THE APPLICATION OF THE DEFENSE COUNSEL.
HOWEVER, THEIR SERVICES WERE OBTAINED WITHOUT THE PRIOR APPROVAL OF THE
CONVENING AUTHORITY AS REQUIRED BY PARAGRAPH 116, OF THE MANUAL FOR
COURTS-MARTIAL, 1969 (REVISED) WHICH PROVIDES:
"116. EMPLOYMENT OF EXPERTS. THE
PROVISIONS OF THIS PARAGRAPH ARE APPLICABLE
UNLESS OTHERWISE PRESCRIBED BY REGULATIONS OF
THE SECRETARY OF A DEPARTMENT. WHEN THE
EMPLOYMENT OF AN EXPERT IS NECESSARY DURING A
TRIAL BY COURT-MARTIAL, THE TRIAL COUNSEL, IN
ADVANCE OF THE EMPLOYMENT, WILL, ON THE ORDER
OR PERMISSION OF THE MILITARY JUDGE OR THE
PRESIDENT OF A SPECIAL COURT-MARTIAL WITHOUT
A MILITARY JUDGE, REQUEST THE CONVENING
AUTHORITY TO AUTHORIZE THE EMPLOYMENT AND TO
FIX THE LIMIT OF COMPENSATION TO BE PAID THE
EXPERT. THE REQUEST SHOULD, IF PRACTICABLE,
STATE THE COMPENSATION THAT IS RECOMMENDED BY
THE PROSECUTION AND THE DEFENSE. WHEN, IN
ADVANCE OF TRIAL, THE PROSECUTION OR THE
DEFENSE KNOWS THAT THE EMPLOYMENT OF AN
EXPERT WILL BE NECESSARY, APPLICATION SHOULD
BE MADE TO THE CONVENING AUTHORITY FOR PERMISSION
TO EMPLOY THE EXPERT, STATING THE
NECESSITY THEREFOR AND THE PROBABLE COST. IN
THE ABSENCE OF A PREVIOUS AUTHORIZATION, ONLY
ORDINARY WITNESS FEES MAY BE PAID FOR THE
EMPLOYMENT OF A PERSON AS AN EXPERT WITNESS."
THE APPLICABLE AGENCY REGULATION WHICH IS SET FORTH AT SECTION 13-38
OF ARMY REGULATION 37-106, AFFIRMS THE ADVANCE AUTHORIZATION REQUIREMENT
OF PARAGRAPH 116, CITED ABOVE, AND PROVIDES AS FOLLOWS:
"13-38. EXPERT WITNESSES (PERSONS NOT
IN GOVERNMENT EMPLOY AND NOT MEMBERS OF THE
UNIFORMED SERVICES)
"A. GENERAL. WHEN THE EMPLOYMENT OF AN
EXPERT WITNESS IS NECESSARY DURING A TRIAL BY
A MILITARY COURT, THE TRIAL COUNSEL WILL
REQUEST THE CONVENING AUTHORITY TO AUTHORIZE
AN EXPERT IN ADVANCE OF SUCH EMPLOYMENT
(PARA 116, MCM, 1969). THE INVITATIONAL
TRAVEL ORDERS SHOULD STATE THE COMPENSATION
RECOMMENDED BY THE PROSECUTION AND DEFENSE.
IN ADDITION, TRAVEL ALLOWANCES AUTHORIZED IN
PARAGRAPH 13-35 MAY BE AUTHORIZED FOR TRAVEL
TO AND FROM THE PLACE OF TRIAL. THE TERMS OF
THE INVITATIONAL TRAVEL ORDER SHOULD BE
SPECIFIC IF THE COMPENSATION INCLUDES TRAVEL
ALLOWANCES TO AND FROM PLACE OF TRIAL OR
SPECIFY THE TRAVEL ALLOWANCES AUTHORIZED IN
ADDITION TO THE COMPENSATION. IN THE ABSENCE
OF THE AUTHORIZATION AND THE PRESCRIBED
PROCEDURES, ONLY THE ORDINARY WITNESS FEES
AND TRAVEL ALLOWANCES MAY BE PAID FOR THE
EMPLOYMENT OF THE WITNESS."
IN VIEW OF THE ABOVE REGULATIONS, THE ARMY HAS DETERMINED THAT IT
DOES NOT HAVE THE AUTHORITY TO ALLOW THE CLAIMS FOR SERVICES AS EXPERT
WITNESSES.
THIS OFFICE HAS HELD THAT THERE IS NO AUTHORITY TO PAY THE FEES OF AN
EXPERT WITNESS IN THE ABSENCE OF PRIOR AUTHORIZATION OF SUCH EMPLOYMENT
AS IS REQUIRED BY THE APPLICABLE PROVISION OF THE MANUAL FOR
COURTS-MARTIAL. SEE B-49109, JUNE 25, 1945, AND B-168623, FEBRUARY 17,
1970, AND JUNE 19, 1970. COMPARE B-57527, JUNE 3, 1946.
IN VIEW OF THE ABOVE, THE ARMY PROPERLY DENIED THE PAYMENT OF FEES AS
EXPERT WITNESSES IN THIS CASE. IN ACCORDANCE WITH PARAGRAPH 116 OF THE
MANUAL FOR COURTS-MARTIAL AND SECTION 13-38 OF ARMY REGULATION 37-106
THE CLAIMANTS ARE ONLY ENTITLED TO RECEIVE PAYMENT OF ORDINARY WITNESS
FEES. AS ORDINARY WITNESSES THE CLAIMANTS ARE ENTITLED TO PAYMENT OF
WITNESS FEES IN THE SAME AMOUNT AS IS PAID UNDER 28 U.S.C. SEC. 1821(B)
(SUPP. IV, 1980) TO WITNESSES APPEARING BEFORE THE COURTS OF THE UNITED
STATES. CF. 36 COMP.GEN. 777 (1957).
AS AN ORDINARY WITNESS, DR. SILVERMAN IS ENTITLED TO THE PAYMENT OF
MILEAGE FOR TRAVEL BY PRIVATELY OWNED CONVEYANCE IN THE SAME MANNER AS
PROVIDED UNDER 28 U.S.C. SEC. 1821(C)(2) (SUPP. IV, 1980) FOR WITNESSES
APPEARING BEFORE THE COURTS OF THE UNITED STATES. SEE 36 COMP.GEN.
777, CITED ABOVE. UNDER 28 U.S.C. SEC. 1821(C)(2) WITNESSES ARE
ENTITLED TO A MILEAGE ALLOWANCE AT THE SAME RATE AS THAT PRESCRIBED BY
THE ADMINISTRATOR OF GENERAL SERVICES PURSUANT TO 5 U.S.C. SEC. 5704.
THE MILEAGE RATE APPLICABLE TO DR. SILVERMAN'S TRAVEL, SET FORTH AT
PARAGRAPH 1-4.2 OF THE FEDERAL TRAVEL REGULATIONS (FPMR 101-7), IS 22.5
CENTS PER MILE.
THE ARMY HAS REQUESTED THAT WE REFER TO THE CONGRESS AS MERITORIOUS
CLAIMS THE ABOVE CLAIMS FOR FEES FOR SERVICES AS EXPERT WITNESSES.
THE MERITORIOUS CLAIMS ACT, NOW 31 U.S.C. SEC. 3702(D), PROVIDES AS
FOLLOWS:
"(D) THE COMPTROLLER GENERAL SHALL
REPORT TO CONGRESS ON A CLAIM AGAINST THE
GOVERNMENT THAT IS TIMELY PRESENTED UNDER
THIS SECTION THAT MAY NOT BE ADJUSTED BY
USING AN EXISTING APPROPRIATION, AND THAT THE
COMPTROLLER GENERAL BELIEVES CONGRESS SHOULD
CONSIDER FOR LEGAL OR EQUITABLE REASONS. THE
REPORT SHALL INCLUDE RECOMMENDATIONS OF THE
COMPTROLLER GENERAL."
THE REMEDY AFFORDED UNDER THE MERITORIOUS CLAIMS ACT IS AN
EXTRAORDINARY REMEDY WHOSE USE IS LIMITED TO EXTRAORDINARY
CIRCUMSTANCES. B-171176, DECEMBER 3, 1970, AND B-191696, JUNE 22, 1981.
THE CASES WE HAVE REPORTED FOR THE CONSIDERATION OF THE CONGRESS HAVE
INVOLVED EQUITABLE CIRCUMSTANCES OF AN UNUSUAL NATURE AND WHICH WERE
UNLIKELY TO CONSTITUTE A RECURRING PROBLEM, SINCE TO REPORT TO THE
CONGRESS A PARTICULAR CASE WHEN SIMILAR EQUITIES EXIST OR ARE LIKELY TO
ARISE WITH RESPECT TO OTHER CLAIMANTS WOULD CONSTITUTE PREFERENTIAL
TREATMENT OVER OTHERS IN SIMILAR CIRCUMSTANCES. SEE 53 COMP.GEN. 157
(1973), AND B-191696, CITED ABOVE.
SINCE THERE HAVE BEEN OTHER CASES WHERE INDIVIDUALS HAVE BEEN DENIED
FEES FOR SERVICES AS EXPERT WITNESSES WHERE THERE WAS A LACK OF PRIOR
AUTHORIZATION BY THE PROPER AUTHORITY, THESE CLAIMS ARE NEITHER UNUSUAL
NOR DO THEY REPRESENT A NONRECURRING SITUATION. THEREFORE, WE FIND NO
ELEMENT OF UNUSUAL LEGAL LIABILITY OR EQUITY WHICH WOULD JUSTIFY OUR
REPORTING THESE CLAIMS TO THE CONGRESS FOR ITS CONSIDERATION UNDER THE
MERITORIOUS CLAIMS ACT.
B-210827, SEP 21, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. IN MATTER OF TIMM, B-206550, OCTOBER 27,
1982, WE HELD THAT NOTWITHSTANDING AGENCY REGULATIONS, NO
RECOUPMENT ACTION NEED BE TAKEN WHEN A SERVICE MEMBER WHO RECEIVED
A REGULAR REENLISTMENT BONUS WAS DISCHARGED EARLY FOR THE PURPOSE
OF IMMEDIATE REELISTMENT BONUS WAS PAYABLE. WE EFFECTIVELY HELD
THAT THE RECOUPMENT REGULATIONS WERE INCONSISTENT WITH THE
GOVERNING BONUS STATUTE AND WERE THEREFORE VOID EFFECTIVE ON
THE DATE OF ENACTMENT OF THE STATUTE IN 1974. THEREFORE, THE TIMM
DECISION IS TO BE APPLIED RETROACTIVELY, AND A SERVICE MEMBER WHO
HAD AN IMPROPER RECOUPMENT ACTION TAKEN AGAINST HIM PRIOR TO THE
TIMM DECISION MAY BE REFUNDED THE AMOUNTS RECOUPED.
2. WHEN A MARINE SERVING IN AN ENLISTMENT
PERIOD FOR WHICH HE RECEIVED A REGULAR REENLISTMENT BONUS IS
DISCHARGED EARLY FOR THE PURPOSE OF IMMEDIATE REENLISTMENT FOR
WHICH NO REENLISTMENT BONUS IS PAYABLE, NO BONUS RECOUPMENT ACTION
IS TO BE TAKEN SO LONG AS THE TERM OF THE REENLISTMENT FOLLOWING
THE EARLY DISCHARGE INCLUDES THE REMAINING PERIOD OF SERVICE IN
THE PRIOR ENLISTMENT. ANY REGULATION TO THE CONTRARY IS INVALID.
SERGEANT FRANKLIN L. SECREST, USMC:
THIS ACTION IS IN RESPONSE TO DEPARTMENT OF DEFENSE MILITARY PAY AND
ALLOWANCE COMMITTEE SUBMISSION DO-MC-1415, WHICH IS A REQUEST FOR AN
ADVANCE DECISION FROM THE DISBURSING OFFICER OF THE UNITED STATES MARINE
CORPS BASE, CAMP PENDLETON, CALIFORNIA. THE DECISION REQUESTED IS
WHETHER, UNDER OUR HOLDING IN MATTER OF TIMM, B-206550, OCTOBER 27,
1982, SERGEANT FRANKLIN L. SECREST, USMC, MAY BE PAID THE AMOUNT HE HAS
CLAIMED AS A REFUND OF A PORTION OF A REGULAR REENLISTMENT BONUS HE
RECEIVED FOR A 2-YEAR ENLISTMENT WHICH WAS THEN RECOUPED WHEN HE WAS
SEPARATED EARLY TO REENLIST IMMEDIATELY FOR 4 YEARS FOR WHICH HE
RECEIVED A SELECTIVE REENLISTMENT BONUS. SINCE THE DECISION IN THE TIMM
CASE CAME AFTER THE RECOUPMENT ACTION TAKEN AGAINST SERGEANT SECREST,
THE FIRST QUESTION PRESENTED IS WHETHER THE TIMM CASE IS TO BE GIVEN
RETROACTIVE EFFECT, AND IF SO, WHETHER OTHER SERVICE MEMBERS IN SERGEANT
SECREST'S SITUATION MUST EACH MAKE A SEPARATE CLAIM IN ORDER TO BECOME
ELIGIBLE FOR A REFUND. THE SECOND QUESTION IS WHETHER A PORTION OF A
REGULAR REENLISTMENT BONUS SHOULD BE RECOUPED WHEN A MEMBER IS SEPARATED
EARLY TO REENLIST IMMEDIATELY FOR AN ENLISTMENT FOR WHICH HE DOES NOT
RECEIVE A SELECTIVE REENLISTMENT BONUS.
IN THE TIMM CASE WE EFFECTIVELY HELD THAT THE REGULATIONS REQUIRING
RECOUPMENT WERE INCONSISTENT WITH THE GOVERNING STATUTE AND WERE
THEREFORE VOID, SO THAT THE TIMM CASE IS TO BE APPLIED RETROACTIVELY.
HENCE, WE CONCLUDE THAT SERGEANT SECREST IS ENTITLED TO A REFUND OF THE
RECOUPED PORTION OF HIS BONUS. OTHER SERVICE MEMBERS SIMILARLY SITUATED
MAY BE TREATED AS A CLASS IF THAT IS DETERMINED TO BE PREFERABLE FROM AN
ADMINISTRATIVE STAND-POINT, BUT REFUNDS WILL BE PAYABLE ON AN INDIVIDUAL
BASIS AND WILL BE SUBJECT TO BEING BARRED BY THE 6-YEAR STATUTE OF
LIMITATIONS, 31 U.S.C. SEC. 3702(B)(1). REGARDING THE SECOND QUESTION,
WE CONCLUDE THAT NO RECOUPMENT ACTION MAY BE TAKEN IF THE TERM OF THE
REENLISTMENT FOLLOWING THE EARLY DISCHARGE INCLUDES THE REMAINING PERIOD
OF SERVICE IN THE PRIOR ENLISTMENT.
SERGEANT SECREST REENLISTED IN THE MARINE CORPS FOR 2 YEARS ON APRIL
20, 1981, FOR WHICH HE WAS PAID A REGULAR REENLISTMENT BONUS OF
$1,593.20. ON APRIL 20, 1982, HE WAS DISCHARGED FROM THAT ENLISTMENT
FOR THE PURPOSE OF IMMEDIATE REENLISTMENT FOR 4 YEARS FOR WHICH A
SELECTIVE REENLISTMENT BONUS WAS PAYABLE.
BECAUSE HIS DISCHARGE WAS MORE THAN 3 MONTHS PRIOR TO THE NORMAL
EXPIRATION DATE OF THE ENLISTMENT FOR WHICH HE RECEIVED THE BONUS, THE
MARINE CORPS RECOUPED $794.29 REPRESENTING THE UNEARNED PORTION OF THE
REGULAR REENLISTMENT BONUS. PAYMENT OF THE SELECTIVE BONUS FOR THE NEW
REENLISTMENT PERIOD OF 4 YEARS APPARENTLY WAS REDUCED BY 25 PERCENT TO
REFLECT THE 1-YEAR PERIOD WHICH HE HAD YET TO SERVE IN THE PREVIOUS
ENLISTMENT, SINCE PAYMENT OF THAT BONUS IS COMPUTED TO EXLUDE THAT
REMAINING PERIOD OF SERVICE. EFFECTIVELY, THESE TWO ACTIONS DENIED
SERGEANT SECREST ANY BONUS, REGULAR OR SELECTIVE, FOR THE PRIOD OF
SERVICE FROM APRIL 21, 1982, TO APRIL 20, 1983.
A REVIEW OF THE TIMM CASE REVEALS THAT THE GENERAL FACTUAL SITUATION
THERE IS VIRTUALLY IDENTICAL TO THE ONE HERE. THAT IS, SERGEANT TIMM
REENLISTED IN THE MARINE CORPS FOR 5 YEARS ON DECEMBER 9, 1975, AND
RECEIVED A $2,000 REGULAR REENLISTMENT BONUS. ON MARCH 7, 1980, HE WAS
DISCHARGED FOR IMMEDIATE REENLISTMENT FOR A 6-YEAR PERIOD FOR WHICH A
SELECTIVE REENLISTMENT BONUS WAS PAYABLE.
SINCE SERGEANT TIMM WAS DISCHARGED MORE THAN 3 MONTHS PRIOR TO THE
NORMAL EXPIRATION OF HIS ENLISTMENT FOR WHICH HE RECEIVED THE REGULAR
REENLISTMENT BONUS, A DISBURSING OFFICER ASKED WHETHER $301.08, THE
UNEARNED PORTION OF THIS BONUS, HAD TO BE RECOUPED. APPARENTLY, THE
DISBURSING OFFICER REALIZED THAT IF RECOUPMENT ACTION WERE TAKEN
SERGEANT TIMM WOULD RECEIVE NO BONUS, EITHER REGULAR OR SELECTIVE, FOR
HIS 9 MONTHS OF SERVICE FROM MARCH 8 TO DECEMBER 7, 1980. THIS
CONCLUSION AROSE SINCE HIS SELECTIVE REENLISTMENT BONUS FOR THE NEW
REENLISTMENT PERIOD WAS REDUCED BY $1,961.03 TO COVER THE 9-MONTH PERIOD
THAT HE WOULD NOT SERVE IN THE PREVIOUS ENLISTMENT BECAUSE PAYMENT OF
THE SELECTIVE BONUS IS COMPUTED TO EXCLUDE THAT PERIOD OF SERVICE.
BOTH SERGEANT TIMM AND SERGEANT SECREST APPARENTLY RECEIVED A REGULAR
REENLISTMENT BONUS UNDER 37 U.S.C. SEC. 308 (1970). THIS LAW AUTHORIZED
BOTH A REGULAR REENLISTMENT BONUS AND A VARIABLE REENLISTMENT BONUS. 37
U.S.C. SEC. 308(A) AND (G) (1970). THE PURPOSE OF THE REGULAR
REENLISTMENT BONUS WAS TO ENABLE THE SERVICES TO MAINTAIN A BODY OF
TRAINED PERSONNEL AND TO REDUCE TRAINING COSTS. THE PURPOSE OF THE
VARIABLE BONUS WAS TO PROVIDE AN ADDITIONAL FINANCIAL INCENTIVE TO
INDUCE REENLISTMENTS OR EXTENSIONS OF ENLISTMENTS OF MEMBERS WHO
POSSESSED CRITICAL MILITARY SKILLS IN SHORT SUPPLY.
UNDER 37 U.S.C. SEC. 308(E) (1970) RECOUPMENT OF ANY BONUS PAID UNDER
SECTION 308, INCLUDING REGULAR OR VARIABLE BONUSES, WAS REQUIRED ANYTIME
A MEMBER WHO HAD RECEIVED SUCH A BONUS WAS "VOLUNTARILY, OR BECAUSE OF
HIS MISCONDUCT" DISCHARGED PRIOR TO THE EXPIRATION OF THE ENLISTMENT
PERIOD FOR WHICH THE BONUS WAS PAID. RECOUPMENT WAS FOR A PRO RATA
AMOUNT OF THE BONUS BASED ON THE UNEXPIRED PART OF THE ENLISTMENT PERIOD
FOR WHICH THE BONUS WAS PAID.
IN THE TIMM CASE, WE NOTED THAT THE STATUTORY AUTHORITY FOR THE
REGULAR AND VARIABLE BONUS PROGRAMS WAS REPEALED EFFECTIVE JUNE 1, 1974,
WITH CERTAIN MEMBERS WHO WERE ON ACTIVE DUTY ON THAT DATE RETAINING
ELIGIBILITY TO RECEIVE THOSE BONUSES. SEE THE ARMED FORCES ENLISTED
PERSONNEL BONUS REVISION ACT OF 1974, PUBLIC LAW 93-277, 88 STAT. 119.
APPARENTLY SERGEANT TIMM WAS ONE OF THE MEMBERS WHOSE ELIGIBILITY
CONTINUED, AS WAS SERGEANT SECREST. THE 1974 ACT ALSO REPLACED THE
PREVIOUS BONUS PROGRAM WITH THE CURRENT SELECTIVE REENLISTMENT BONUS
PROGRAM CODIFIED IN 37 U.S.C. SEC. 308 (1976). THE NEW BONUS PROGRAM
WAS ESTABLISHED TO CONTINUE IN A DIFFERENT MANNER A PROGRAM OF PROVIDING
A FINANCIAL INDUCEMENT TO MEMBERS OF THE ARMED FORCES WHO HAVE CRITICAL
MILITARY SKILLS TO REENLIST OR EXTEND THEIR ENLISTMENTS. THE SELECTIVE
BONUS IS COMPUTED ONLY ON THE BASIS OF "ADDITIONAL OBLIGATED SERVICE."
37 U.S.C. SEC. 308(A)(1) (SUPP. IV 1980). PROVISIONS FOR RECOUPING A
SELECTIVE REENLISTMENT BONUS FROM A MEMBER WHO FAILS TO SERVE THE FULL
ENLISTMENT PERIOD ARE SIMILAR TO THOSE WHICH APPLIED TO THE REGULAR AND
VARIABLE BONUSES. 37 U.S.C. SEC. 308(D) (SUPP. IV 1980).
WE ALSO NOTED IN THE TIMM DECISION THAT SUBPARAGRAPH 10942A OF THE
DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCES ENTITLEMENTS MANUAL
(DODPM) PROVIDES THAT IF A SERVICE MEMBER WHO RECEIVES A REGULAR
REENLISTMENT BONUS IS DISCHARGED EARLY FOR THE PURPOSE OF REENLISTING, A
PRO RATA PORTION OF THE BONUS MUST BE RECOUPED AT THE TIME OF DISCHARGE.
WE RECOGNIZED THAT ONE OF THE OBVIOUS PURPOSES OF THIS PROVISION WAS
ORIGINALLY TO PREVENT THE RECEIPT OF TWO BONUSES FOR THE SAME PERIOD OF
SERVICE. WE FURTHER RECOGNIZED, HOWEVER, THAT THE 1974 REVISIONS IN THE
STATUTORY LAW MADE THIS PROVISION OF REGULATION INAPPROPRIATE IN THE
CASE OF A MEMBER WHO RECEIVES AN EARLY DISCHARGE AND A SELECTIVE
REENLISTMENT BONUS BECAUSE ONLY "ADDITIONAL" OBLIGATED SERVICE IS
COUNTED IN COMPUTING THE SELECTIVE REENLISTMENT BONUS. THUS, WE
CONCLUDED THAT THERE WAS NO STATUTORY BASIS FOR TAKING RECOUPMENT ACTION
IN A CASE SUCH AS THAT OF SERGEANT TIMM OR SERGEANT SECREST, SINCE THE
MEMBER'S SELECTIVE REENLISTMENT BONUS IS COMPUTED TO EXLUDE A PERIOD
EQUAL TO THE UNEXPIRED TERM OF THE PRIOR ENLISTMENT. THE MEMBER PERFORMS
THE FULL PERIOD OF SERVICE FOR WHICH THE REGULAR BONUS WAS PAID WITHOUT
RECEIVING CREDIT UNDER THE SELECTIVE BONUS PROGRAM FOR THAT SERVICE, SO
THAT NO RECOUPMENT OF ANY PORTION OF THE REGULAR BONUS IS WARRANTED
UNDER 37 U.S.C. SEC. 308(D).
OUR DECISION IN THE TIMM CASE WAS ESSENTIALLY A HOLDING THAT AS
APPLIED TO SERGEANT TIMM'S SITUATION THE RECOUPMENT PROVISIONS OF
SUBPARAGRAPH 10942A OF THE DODPM WERE INCONSISTENT WITH THE GOVERNING
PROVISIONS OF 37 U.S.C. SEC. 308 AND HENCE WERE INVALID. THIS WAS A
CASE OF FIRST IMPRESSION OR ORIGINAL CONSTRUCTION, SINCE WE HAD NOT
PREVIOUSLY HAD THE OCCASION TO CONSIDER THE ISSUE PRESENTED.
GENERALLY, DECISIONS OF OUR OFFICE INVOLVING THE ORIGINAL
CONSTRUCTION OF A STATUTE APPLY RETROACTIVELY TO THE DATE THAT THE
STATUTE FIRST WENT INTO EFFECT. SEE 40 COMP.GEN. 14, 17-18 (1960); AND
39 ID. 455, 456 (1959). COMPARE 60 ID. 285, 288 AND 357, 359-360
(1981). AS AN EXCEPTION TO THIS RULE WE HAVE OCCASIONALLY GIVEN ONLY
PROSPECTIVE EFFECT TO SUCH DECISIONS WHEN THEY RESULTED IN THE VOIDING
OF ADMINISTRATIVE REGULATIONS, BUT THIS WAS DONE SOLELY FOR THE LIMITED
PURPOSE OF PRECLUDING COLLECTION ACTION AGAINST INDIVIDUALS WHO
PREVIOUSLY AND IN GOOD FAITH RECEIVED PAYMENTS FROM THE GOVERNMENT ON
THE BASIS OF THE INVALIDATED REGULATIONS. SEE 54 COMP.GEN. 890, 891-892
(1975); 24 ID. 688 (1945); AND B-170589, AUGUST 8, 1974. AS
INDICATED, THESE CASES ARE EXCEPTIONAL, AND ORDINARILY IN A DECISION OF
FIRST IMPRESSION REGULATIONS FOUND TO BE INCONSISTENT WITH STATUTE MAY
NOT BE REGARDED AS INVALID OR UNENFORCEABLE MERELY ON A PROSPECTIVE
BASIS. SINCE THE ORIGINAL CONSTRUCTION OF A STATUTE IS INVOLVED, THE
REGULATIONS MUST INSTEAD NORMALLY BE CONSIDERED AS INVALIDATED
RETROACTIVELY TO THE DATE OF THEIR INCEPTION UNDER THE STATUTE, I.E.,
THEY ARE CONSIDERED NULL AND VOID AB INITIO. SEE 56 COMP.GEN. 943, 945
(1977); AND 41 ID. 213, 217 (1961). THIS IS IN ACCORD WITH PRINCIPLES
OF STATUTORY CONSTRUCTION AND JUDICIAL PRECEDENT FOLLOWED BY THE COURTS.
SEE, GENERALLY 1A SUTHERLAND, STATUTES AND STATUTORY CONSTRUCTION SEC.
31.02 (4TH ED. C.D. SANDS 1972); 20 AM. JUR. 2D COURTS SECS. 233-235
(1965); ANNOT., 10 A.L.R. 3D 1371 (1966) AND 153 A.L.R. 1188 (1944).
LIMITATION OF THE TIMM DECISION TO PROSPECTIVE APPLICATION WOULD
RESULT IN A CONCLUSION THAT PRIOR TO THE DATE OF THE DECISION THE
RECOUPMENT OF REGULAR REENLISTMENT BONUS MONIES FROM SERVICE MEMBERS IN
SERGEANT TIMM'S SITUATION WAS PROPER UNDER SUBPARAGRAPH 10942A, DODPM,
NOTWITHSTANDING THAT THIS WAS INCONSISTENT WITH, AND IMPERMISSIBLE
UNDER, THE GOVERNING PROVISIONS OF STATUTE CONTAINED IN THE ARMED FORCES
ENLISTED PERSONNEL BONUS REVISION ACT OF 1974. WE ARE UNABLE TO FIND
ANY LAWFUL BASIS TO SUPPORT SUCH A CONCLUSION, AND WE THEREFORE HOLD
THAT THE BONUS RECOUPMENT PROVISIONS OF SUBPARAGRAPH 10942A, DODPM, ARE
INVALID FROM AND AFTER JUNE 1, 1974, TO THE EXTENT THAT THEY WERE FOUND
IN THE TIMM DECISION TO BE INCONSISTENT WITH THE 1974 ACT.
HENCE, PAYMENT MAY ISSUE ON SERGEANT SECREST'S CLAIM IN THE FULL
AMOUNT, IF OTHERWISE CORRECT. WE WOULD NOT OBJECT TO OTHER SERVICE
MEMBERS OR FORMER MEMBERS SIMILARLY SITUATED BEING TREATED AS A SINGLE
CLASS, IF THAT IS DETERMINED TO BE PREFERABLE FROM AN ADMINISTRATIVE
STANDPOINT. HOWEVER, THE BURDEN OF ESTABLISHING THE EXISTENCE AND
NONPAYMENT OF A VALID CLAIM AGAINST THE GOVERNMENT IS ULTIMATELY ON THE
PARTICULAR INDIVIDUAL ASSERTING THE CLAIM, AND REFUNDS OF REGULAR
REENLISTMENT BONUS MONIIES BASED ON THE TIMM DECISION WILL BE PAYABLE ON
AN INDIVIDUAL BASIS REGARDLESS OF THE FORMATION OF SUCH A CLASS FOR
ADMINISTRATIVE PURPOSES. IT IS ESPECIALLY TO BE NOTED THAT SOME REFUND
PAYMENTS MAY BE BARRED BY THE RUNNING OF THE 6-YEAR STATUTE OF
LIMITATIONS PRESCRIBED BY 31 U.S.C. SEC. 3702(B)(1), UNLESS IN AN
INDIVIDUAL CASE THE RUNNING OF THE STATUTORY PERIOD HAS BEEN TOLLED BY
OPERATION OF SECTION 205 OF THE SOLDIERS' AND SAILORS' CIVIL RELIEF ACT,
50 U.S.C. APP. SEC. 525, DUE TO THE INDIVIDUAL'S CONTINUATION ON ACTIVE
MILITARY SERVICE. SEE 41 COMP.GEN. 812, 818 (1962); AND COMPARE
BICKFORD V. UNITED STATES, 656 F.2D 636, 639-641 (CT.CL. 1981).
THE SECOND QUESTION PRESENTED IS WHETHER RECOUPMENT ACTION IS
PERMISSIBLE WHEN A MEMBER IS DISCHARGED EARLY FROM AN ENLISTMENT FOR
WHICH HE RECEIVED A REGULAR REENLISTMENT BONUS TO ENLIST IMMEDIATELY IN
AN ENLISTMENT FOR WHICH NO BONUS IS PAID. CURRENTLY, THE WORDING IN
SUBPARAGRAPH 10942A, DODPM, WHICH WAS HELD INVALID IN THE TIMM DECISION
PROVIDES THAT RECOUPMENT MUST TAKE PLACE IN THIS SITUATION.
WE CONSIDER OUR RULING IN THE TIMM CASE TO BE DISPOSITIVE OF THIS
ISSUE. WHEN THE REENLISTMENT BONUS PROGRAM WAS REVISED BY STATUTE IN
1974, THE RECOUPMENT PROVISION IN SUBPARAGRAPH 10942A SHOULD NOT HAVE
BEEN RETAINED SINCE IT WAS NOT CONSISTENT WITH THE NEW STATUTE. THIS
PROVISION WAS NOT NEEDED TO PREVENT DUPLICATE PAYMENTS AND WITHOUT THAT
JUSTIFICATION RECOUPMENT OF REENLISTMENT BONUSES IS INAPPROPRIATE
BECAUSE THE INDIVIDUAL IN FACT RENDERS THE SERVICE FOR WHICH THE BONUS
WAS PAID. THUS, AS LONG AS THE REELISTMENT FOLLOWING THE EARLY
DISCHARGE INCLUDES THE REMAINING PERIOD OF SERVICE ON THE PRIOR
ENLISTMENT, NO RECOUPMENT ACTION IS WARRANTED UNDER 37 U.S.C. SEC. 308.
TO THE EXTENT THAT SUBPARAGRAPH 10942A, DODPM, PURPORTS TO AUTHORIZE THE
RECOUPMENT OF THE REGULAR REENLISTMENT BONUS IN THAT SITUATION, IT IS
INCONSISTENT WITH THE STATUTE AND INVALID.
THE QUESTIONS PRESENTED ARE ANSWERED ACCORDINGLY.
B-210823, JUN 28, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
REJECTION OF A LOW BID AS NONRESPONSIVE IS PROPER WHERE DESCRIPTIVE
DATA REQUIRED TO BE SUBMITTED WITH THE BID FOR EVALUATION PURPOSES DOES
NOT DEMONSTRATE THE BIDDER'S COMPLIANCE WITH THE SPECIFICATIONS.
ZERO MANUFACTURING CO.:
ZERO MANUFACTURING CO. (ZERO) PROTESTS THE DEPARTMENT OF THE ARMY'S
(ARMY) REJECTION OF ITS LOW BID AS NONRESPONSIVE UNDER INVITATION FOR
BIDS (IFB) NO. DAAG47-82-B-0139 FOR TWO ABRASIVE BLAST CLEANING
MACHINES.
THE IFB REQUIRED THE SUBMISSION OF DESCRIPTIVE DATA WITH THE BID TO
SHOW THAT THE PRODUCT OFFERED CONFORMED TO THE SPECIFICATIONS.
PROSPECTIVE BIDDERS WERE ADVISED THAT THE DATA SHOULD CLEARLY INDICATE
THE CHARACTERISTICS OF THE MATERIAL OFFERED. MOREOVER, THE BIDDERS WERE
SPECIFICALLY ADVISED THAT THIS DATA WAS TO BE FURNISHED FOR BID
EVALUATION. ZERO'S BID CONTAINED SOME DRAWINGS ILLUSTRATING THE BASIC
ITEMS OF PROPOSED EQUIPMENT, AN ARRANGEMENT DRAWING, A BROCHURE
CONCERNING AIRLESS EQUIPMENT AND LITERATURE ENTITLED "MACHINE
SPECIFICATIONS FOR BLAST CLEANING MACHINE SELF-CONTAINED TUMBLE TYPE
WITH LOADER AND DUST COLLECTOR."
THE ARMY REJECTED ZERO'S BID FOR VARIOUS REASONS RELATING TO
INADEQUATE DESCRIPTIVE DATA. TWO OF THE REASONS ARE THAT THE
1-CUBIC-FOOT STORAGE HOPPER AND A 19.5-INCH DIAMETER WHEEL WITH A
2,720-RPM SPEED ON A 30-HORSEPOWER MOTOR PROPOSED BY ZERO ARE NOT
ADEQUATE SINCE EACH WILL NOT ALLOW THE MACHINE TO MEET THE 48,000 POUNDS
OF METALLIC ABRASIVE PER HOUR SPECIFICATION REQUIREMENT.
OUR OFFICE HAS HELD THAT THE SUBMISSION OF DESCRIPTIVE DATA, WHERE
THE DATA IS USED FOR BID EVALUATION, IS A MATTER OF RESPONSIVENESS AND
WHERE SUCH DATA INDICATES A DEVIATION FROM THE SPECIFICATIONS, REJECTION
OF THE BID IS REQUIRED. SPRAGUE & HENWOOD, INC., B-201028, APRIL 6,
1981, 81-1 CPD 260. THEREFORE, A BID MUST BE REJECTED IF THE DATA
SUBMITTED WITH THE BID DOES NOT CLEARLY SHOW THAT THE PRODUCT OFFERED
COMPLIES WITH THE SPECIFICATIONS.
WE AGREE WITH THE ARMY THAT ZERO'S BID DID NOT INCLUDE SUFFICIENT
DATA TO DEMONSTRATE THAT THE PRODUCT OFFERED WOULD COMPLY WITH THE
48,000 POUNDS PER HOUR PERFORMANCE SPECIFICATION. WHILE ZERO HAS
PRESENTED INFORMATION TO SUPPORT ITS POSITION THAT ITS MACHINE MEETS THE
IFB REQUIREMENT, THIS INFORMATION WAS NOT INCLUDED IN ITS BID.
DESCRIPTIVE LITERATURE THAT WOULD PROVIDE THIS TYPE OF EXPLANATION IS
WHAT ZERO SHOULD HAVE SUBMITTED WITH ITS BID SINCE THE BURDEN IS ON EACH
BIDDER TO MAKE ITS BID AND LITERATURE, IF REQUIRED, CONFORM TO THE IFB
REQUIREMENTS. THEREFORE, WE FIND THAT THE ARMY PROPERLY REJECTED ZERO'S
BID.
ZERO'S PROTEST IS DENIED.
B-210819, JUN 21, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST ISSUES DO NOT BECOME ACADEMIC SO LONG AS THE PROTEST, IF
SUSTAINED, MAY RESULT IN AWARD OF A CONTRACT TO THE PROTESTER.
2. PARTIAL CANCELLATION OF A SOLICITATION IS JUSTIFIED WHEN THE
AGENCY NO LONGER NEEDS THE QUANTITY OF SUPPLIES ORIGINALLY SOLICITED.
3. AGENCY NEED NOT WITHHOLD AWARD OF CONTRACT TO ANOTHER BIDDER
FOUND TO BE RESPONSIBLE OR INDEFINITELY SUSPEND EMERGENCY PROCUREMENT TO
MEET CRITICAL NEED PENDING SMALL BUSINESS ADMINISTRATION (SBA)
CERTIFICATE OF COMPETENCY (COC) DETERMINATION SINCE APPLICABLE
REGULATION PERMITS AWARD 15 WORKING DAYS AFTER NOTICE TO SBA OF REQUEST
FOR COC.
4. PROTEST BY A FIRM WHICH IS NOT A BIDDER UNDER SOLICITATIONS
AGAINST FAILURE TO RECEIVE NOTICE OF AWARDS IS WITHOUT MERIT. UNDER
DEFENSE ACQUISITION REGULATION, AGENCY IS REQUIRED TO PROVIDE PROMPT
NOTICE OF AWARD ONLY TO UNSUCCESSFUL OFFERORS. IN ANY EVENT, FAILURE TO
PROVIDE NOTICE IS A PROCEDURAL MATTER WHICH DOES NOT AFFECT VALIDITY OF
AWARD.
KAN-DU TOOL & INSTRUMENT CORP.:
KAN-DU TOOL & INSTRUMENT CORP. (KAN-DU) PROTESTS THE ARMY
TANK-AUTOMOTIVE COMMAND'S (TACOM) REFUSAL TO AWARD IT A CONTRACT FOR
10,248 DIRECT VISION BLOCKS UNDER INVITATION FOR BIDS (IFB) NO.
DAAE07-82-B-A932 AND OBJECTS TO THE PARTIAL AWARDS TO OTHER BIDDERS OF
QUANTITIES OF BLOCKS UNDER EMERGENCY ORAL SOLICITATIONS. FURTHERMORE,
THE PROTESTER ASSERTS THAT THE CONTRACTING AGENCY AND THE SMALL BUSINESS
ADMINISTRATION (SBA) UNREASONABLY DELAYED THE ISSUANCE OF A CERTIFICATE
OF COMPETENCY (COC) FOR KAN-DU.
WE DENY THE PROTEST.
ON JUNE 25, 1982, THE ARMY ISSUED THE IFB REQUESTING BIDS FOR SMALL
BUSINESSES TO PRODUCE 10,248 DIRECT VISION BLOCKS FOR THE M60 TANK. THE
IFB WAS INTENDED TO FILL THREE PROCUREMENT WORK DIRECTIVES (PWD) ISSUED
IN JANUARY, FEBRUARY AND MARCH OF 1982. THE ARMY INTENDED THAT A FOURTH
PWD, DATED MAY 17, 1982, FOR 1,374 VISION BLOCKS WOULD BE COVERED UNDER
AN OPTION PROVISION UNDER THE IFB. KAN-DU, A SMALL BUSINESS, SUBMITTED
THE APPARENT LOW BID OF $74.36 PER UNIT. THE NEXT LOW BID WAS FOR
$83.83 PER UNIT.
PRIOR TO THIS PROCUREMENT, KAN-DU HAD NEVER MANUFACTURED VISION
BLOCKS OR ANYTHING SIMILAR. THE CONTRACTING OFFICER THEREFORE ASKED FOR
A PREAWARD SURVEY (PAS), WITH A TACOM REPRESENTATIVE'S PARTICIPATION, TO
BE CONDUCTED AT KAN-DU AND ITS SUBCONTRACTORS, FOLEY PRECISION OPTICAL,
INC. (FOLEY), AND LAMINATED GLASS. ALTHOUGH THE CONTRACTING OFFICER
ASKED THAT THE PAS BE COMPLETED BY AUGUST 27, THE RESULTS DID NOT REACH
HIM UNTIL OCTOBER 11.
THE PAS OF KAN-DU AND OF FOLEY RESULTED IN A NONRESPONSIBILITY
DETERMINATION BY THE CONTRACTING OFFICER ON OCTOBER 14. ON OCTOBER 18,
THE MATTER WAS REFERRED TO THE SBA FOR COC CONSIDERATION. ON NOVEMBER
2, THE SBA NEW YORK REGIONAL OFFICE WROTE THE CONTRACTING OFFICER TO
INFORM HIM THAT KAN-DU HAD APPLIED FOR A COC, AND THAT THE EXPIRATION
DATE FOR SBA ACTION WAS NOVEMBER 18. UNDER DAR SEC. 1-705.4(C) (DAC
76-34, APRIL 27, 1982), THE ARMY WAS REQUIRED TO WAIT 15 WORKING DAYS
FOR AN SBA COC DECISION BEFORE MAKING AN AWARD.
BY THE END OF THE 15-DAY WAITING PERIOD, NOVEMBER 18, SBA HAD NOT
ISSUED A COC. ON NOVEMBER 22, 4 DAYS LATER, SBA'S NEW YORK
REPRESENTATIVE CALLED TO SAY THAT THE SBA'S PROCESSING DEADLINE HAD BEEN
POSTPONED TO NOVEMBER 30. THE NEXT DAY, HE CALLED THE CONTRACTING
OFFICER TO REPORT THAT HE WOULD RECOMMEND THE ISSUANCE OF A COC FOR
KAN-DU PRIMARILY ON THE BASIS OF A FAVORABLE PAS FOR LAMINATED GLASS.
THE CONTRACTING OFFICER OBJECTED BECAUSE NO TACOM REPRESENTATIVE HAD
BEEN ON THE PAS TEAM FOR THE LAMINATED GLASS PAS. HE ASKED SBA TO
POSTPONE ISSUANCE OF A COC UNTIL A PAS COULD BE CONDUCTED WITH TACOM
PARTICIPATION.
BEFORE RECEIVING ANY PAS RESULTS, THE CONTRACTING OFFICER HAD
RECEIVED NOTICE THAT DIRECT VISION BLOCKS WERE OUT OF STOCK. THIS
SHORTAGE CREATED A PUBLIC EXIGENCY UNDER DEFENSE ACQUISITION REGULATION
(DAR) SEC. 3-202.2(VI) (DEFENSE ACQUISITION CIRCULAR (DAC) 76-20,
SEPTEMBER 17, 1979), AND THE CONTRACTING OFFICER DECIDED TO ORALLY
SOLICIT BIDS FOR THE MAY 17 PWD UNDER DAR SEC. 3-101(B) (1976 ED.). TWO
PREVIOUS SUPPLIERS OF DIRECT VISION BLOCKS WERE SOLICITED AND A CONTRACT
WAS AWARDED ON NOVEMBER 24, 1982, AFTER THE 15-DAY WAITING PERIOD HAD
EXPIRED. ACCORDING TO THE CONTRACTING OFFICER, THE QUANTITY SOLICITED
REPRESENTED THE FOURTH PWD WHICH QUANTITY WAS AN OPTION UNDER THE IFB.
BECAUSE OF THE CONTINUED DELAYS IN DETERMINING KAN-DU'S ENTITLEMENT
TO A COC, THE ARMY GENERATED ANOTHER PWD FOR 1,500 VISION BLOCKS ON
DECEMBER 9 AND AGAIN ORALLY SOLICITED BIDS UNDER THE PUBLIC EXIGENCY
PROVISION. A CONTRACT WAS AWARDED ON DECEMBER 27. ON DECEMBER 29, THE
CONTRACTING OFFICER ELECTED TO EXERCISE AN OPTION FOR 1,374 ADDITIONAL
BLOCKS UNDER THE NOVEMBER 24 CONTRACT. AN OPTION FOR 1,500 BLOCKS IN
THE DECEMBER 27 CONTRACT WAS EXERCISED ON JANUARY 11, 1983. ANOTHER
PUBLIC EXIGENCY ORAL SOLICITATION WAS MADE ON JANUARY 4, RESULTING IN
THE AWARD OF A CONTRACT FOR 1,500 BLOCKS. THE OPTION FOR AN ADDITIONAL
1,500 BLOCKS FOR THIS CONTRACT WAS EXERCISED ON JANUARY 25.
THE PAS OF LAMINATED GLASS WAS FINALLY HELD ON JANUARY 17, 1983. THE
COC EVALUATION FOR KAN-DU WAS COMPLETED ON FEBRUARY 4, 1983, WHEN SBA'S
NEW YORK OFFICE ISSUED A COC FOR KAN-DU. BY THE TIME SBA ISSUED ITS COC
ON FEBRUARY 4, THE CONTRACTING OFFICER HAD ISSUED CONTRACTS FOR 8,748
VISION BLOCKS. ALL QUANTITIES WERE AWARDED AFTER THE 15-DAY WAITING
PERIOD FOR COC ACTION HAD EXPIRED, NOVEMBER 18.
ON JANUARY 30, THE CONTRACTING OFFICER WAS ADVISED THAT TWO OF THE
THREE PWD'S INCLUDED IN THE ORIGINAL IFB WERE BEING CANCELED. THE TOTAL
NUMBER OF BLOCKS UNDER THE IFB WAS REDUCED FROM 10,248 TO 1,549.
AFTER KAN-DU RECEIVED THE COC, THE ARMY OFFERED TO AWARD IT A
CONTRACT FOR 1,549 DIRECT VISION BLOCKS AT A PRICE OF $74.36 PER UNIT
UNDER THE ORIGINAL IFB. KAN-DU RESPONDED BY EXTENDING ITS OFFER FOR
10,248 BLOCKS AT $74.36 EACH AND PROTESTED THE DELAYS IN AWARDING THE
CONTRACT AND THE FAILURE TO AWARD THE FULL, ORIGINAL QUANTITY.
THE ARMY INITIALLY CONTENDS THAT THE TERMS OF KAN-DU'S EXTENSION
AMOUNT TO A WITHDRAWAL OF ITS BID. FURTHER, IT ASSERTS THAT WITHDRAWAL
OF THE BID RENDERS THE KAN-DU PROTEST ISSUES ACADEMIC AND THAT OUR
OFFICE SHOULD NOT CONSIDER A PROTEST WHEN THE ISSUES HAVE RENDERED
ACADEMIC.
WE WILL NOT CONSIDER ACADEMIC ISSUES IN THE CONTEXT OF A PROTESTER'S
WITHDRAWN BID. RISI INDUSTRIES, INC.; WESTMONT INDUSTRIES, B-191024,
APRIL 27, 1978, 78-1 CPD 329. HOWEVER, WE WILL CONSIDER PROTESTS WHERE,
AS HERE, THE ISSUE BEING PROTESTED IS THE REASONABLENESS OF THE DELAY IN
AWARDING A CONTRACT. SEE YARDNEY ELECTRIC DIVISION, 60 COMP. GEN. 499
(1981), 81-1 CPD 440. KAN-DU HAS EXTENDED ITS OFFER FOR 10,248 VISION
BLOCKS AND PROTESTS THE ARMY'S REDUCTION OF THE QUANTITY UNDER THE IFB.
IT HAS NOT QUALIFIED ITS EXTENSION IN ANY WAY. IF WE WERE TO SUSTAIN
KAN-DU'S PROTEST, IT WOULD BE ELIGIBLE FOR AWARD OF A CONTRACT;
THEREFORE, THE ISSUES IN THIS PROTEST ARE NOT ACADEMIC.
GENERALLY, CANCELLATION OF A SOLICITATION AFTER BID OPENING REQUIRES
A COMPELLING REASON ON THE PART OF THE AGENCY. THIS RULE APPLIES TO
BOTH TOTAL CANCELLATION AND PARTIAL CANCELLATION. LM&E COMPANY, INC.,
61 COMP.GEN. 496, (1982), 82-1 CPD 603. THE REGULATIONS CLEARLY PERMIT
CANCELLATION WHEN THE SUPPLIES OR SERVICES BEING SOLICITED ARE NO LONGER
NEEDED. DAR SEC. 2-404.1(B)(III) (1976 ED.); RAMSEY CANYON ENTERPRISES,
B-204576, MARCH 15, 1982, 82-1 CPD 237.
WITH RESPECT TO PARTIAL CANCELLATION, WE NOTE THAT THE IFB CONTAINED
A PROVISION WHICH RESERVES THE RIGHT TO THE GOVERNMENT TO AWARD ON ANY
LINE ITEM FOR A QUANTITY LESS THAN THE QUANTITY OFFERED, AT THE UNIT
PRICES OFFERED, UNLESS THE BIDDER SPECIFIES OTHERWISE IN ITS BID. THUS,
A PARTIAL CANCELLATION AND THE ARMY'S OFFER TO AWARD KAN-DU A REDUCED
QUANTITY WERE PERMISSIBLE UNDER THE IFB. SEE, E.G., LM&E COMPANY, INC.,
SUPRA.
KAN-DU CONTENDS THE ARMY'S DETERMINATION OF NONRESPONSIBILITY AND THE
COC PROCEEDING WERE UNREASONABLY DELAYED. HOWEVER, KAN-DU ACKNOWLEDGES
THAT PRODUCTION OF THE DIRECT VISION BLOCKS REQUIRES EXPERTISE IN
SEVERAL AREAS. ALSO, THE CONTRACTING OFFICER REPORTS THAT THE END ITEM
WAS NOT WITHIN KAN-DU'S NORMAL LINE OF BUSINESS, AND THAT KAN-DU WAS
SUBCONTRACTING WITH TWO OTHER FIRMS FOR PART OF THE WORK. ACCORDING TO
THE ARMY, BECAUSE OF THESE FACTORS, THE ARMY BELIEVED AN IN-DEPTH
PREAWARD SURVEY WITH A CONTRACTING OFFICER'S REPRESENTATIVE PRESENT AT
THE PAS WAS NECESSARY. THE ARMY ADVISES THAT AS SOON AS A NEGATIVE
RESPONSIBILITY DETERMINATION WAS MADE, THE MATTER WAS REFERRED TO SBA.
UNDER THESE CIRCUMSTANCES, WE THINK THE TIME TAKEN FOR THE PAS WAS NOT
UNREASONABLE.
AS REQUIRED BY DAR SEC. 1-705.4(C), SUPRA, THE CONTRACTING AGENCY IN
THIS CASE REFERRED THE QUESTION OF KAN-DU'S RESPONSIBILITY TO SBA. IN
THIS CONNECTION, WHILE AN AGENCY IS BOUND BY SBA'S ISSUANCE OF A COC, IT
NEED NOT INDEFINITELY WITHHOLD AWARD TO ANOTHER BIDDER WHICH IT HAS
FOUND TO BE RESPONSIBLE PENDING SBA'S DECISION ON THE COC. THE
REGULATION REQUIRES THAT AWARD BE WITHHELD UNTIL SBA ACTION CONCERNING
THE ISSUANCE OF A COC OR UNTIL 15 WORKING DAYS AFTER SBA IS NOTIFIED OF
THE REQUEST FOR A COC, WHICHEVER IS EARLIER. DAR SEC. 1-705.4(C),
SUPRA.
AFTER THE 15-DAY PERIOD HAD EXPIRED ON NOVEMBER 18, THE AGENCY
PROPERLY COULD MAKE AN AWARD TO ANOTHER BIDDER WHERE, AS HERE, SBA HAD
NOT ACTED ON THE COC. SEE DIESEL ENERGY SYSTEMS, CO., B-203781, JULY 8,
1981, 81-2 CPD 24. THE ARMY WAS NOT LEGALLY REQUIRED TO FURTHER SUSPEND
PROCUREMENT ACTION TO MEET ITS NEEDS. IN FACT, THE ARMY DELAYED AWARDS
UNTIL THE NEEDS BECAME CRITICAL, APPARENTLY TRYING TO HOLD THE AWARDS
UNTIL KAN-DU'S RESPONSIBILITY WAS RESOLVED BY THE SBA.
UNDER THE DAR, IN A PUBLIC EXIGENCY SITUATION, THE CONTRACTING AGENCY
SOLICITS OFFERS "FROM THE MAXIMUM NUMBER OF QUALIFIED SOURCES CONSISTENT
WITH THE NATURE AND REQUIREMENTS OF THE SUPPLIES *** TO BE PROCURED."
DAR SEC. 3-101(B) (1976 ED.). BECAUSE OF QUESTIONS REGARDING KAN-DU'S
RESPONSIBILITY, THE ARMY PROPERLY DID NOT CONSIDER KAN-DU AS A
"QUALIFIED SOURCE" FOR THESE URGENT PROCUREMENTS. WE NOTE THAT THESE
EMERGENCY AWARDS WERE MADE TO COMPANIES WHICH HAD PRODUCED VISION BLOCKS
OR SIMILAR PRODUCTS UNDER PRIOR PROCUREMENTS AND WHICH WERE IN THE BEST
POSITION TO SATISFY FIRST ARTICLE TESTING TO EXPEDITE DELIVERY OF THE
SUPPLIES.
SINCE KAN-DU WAS NOT ELIGIBLE FOR AWARD UNDER THESE EMERGENCY
SOLICITATIONS, THE FAILURE TO NOTIFY KAN-DU OF THESE AWARDS DID NOT
PREJUDICE KAN-DU. FURTHERMORE, DAR SEC. 3-508.3 (1976 ED.) REQUIRES
ONLY THAT NOTICE BE GIVEN TO UNSUCCESSFUL OFFERORS PROMPTLY AND KAN-DU
WAS NOT AN OFFEROR UNDER THE ORAL SOLICITATIONS. IN ANY EVENT, THE
FAILURE TO PROVIDE PROMPT NOTICE OF THE AWARD IS MERELY A PROCEDURAL
MATTER WHICH DOES NOT AFFECT THE VALIDITY OF THE AWARDS. SEE POLICY
RESEARCH INCORPORATED, B-200386, MARCH 5, 1981, 81-1 CPD 172.
WE DENY THE PROTEST.
B-210818.3, B-213173, APR 25, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE A BIDDER ALLEGES A MISTAKE AFTER BID
OPENING, IT IS NOT THEN GENERALLY FREE TO DECIDE
TO WAIVE ITS CLAIM. NEVERTHELESS, WAIVER WILL BE
PERMITTED IF IT IS CLEAR THAT THE INTENDED BID
WOULD HAVE BEEN THE LOWEST EVEN THOUGH THE
INTENDED BID COULD NOT BE CLEARLY PROVEN FOR THE
PURPOSE OF BID CORRECTION. HOWEVER, IT IS IMPOSSIBLE
TO CONCLUDE THAT ALLEGED MISTAKEN BID WOULD
HAVE BEEN THE LOWEST WHERE BIDDER SUBMITTED CONFLICTING
CLAIMS AS TO AMOUNT OF MISTAKE. THEREFORE,
GAO SUSTAINS THE PROTEST, BUT THE ONLY
POSSIBLE REMEDY IN THE CIRCUMSTANCES IS THE
GRANTING OF BID PREPARATION COSTS.
DSG CORPORATION:
DSG CORPORATION (DSG) PROTESTS THE AIR FORCE'S CONSIDERATION OF A BID
SUBMITTED BY SPACE SERVICES INTERNATIONAL (SSI) UNDER INVITATION FOR
BIDS NO. F65501-83-B-0004 (IFB-0004) ISSUED BY ELMENDORF AIR FORCE BASE,
ALASKA, FOR MESS ATTENDANT SERVICES FOR A BASE PERIOD (DATE OF AWARD
THROUGH SEPTEMBER 1983) AND TWO OPTION PERIODS (ALL OF FISCAL YEARS 1984
AND 1985). SINCE DSG'S PROTEST, THE AIR FORCE ISSUED AND AWARDED TWO
INTERIM CONTRACTS PENDING RESOLUTION OF THE PROTEST. THE AIR FORCE ALSO
ISSUED INVITATION FOR BIDS NO. F65501-83-B-0205 (IFB-0205) FOR THE SAME
SERVICES COVERED BY IFB-0004 (INCLUDING 2 OPTION YEARS). WE UNDERSTAND
THAT DSG WAS AFFORDED AN OPPORTUNITY TO BID ON IFB-0205 BUT ELECTED NOT
TO. WE FURTHER UNDERSTAND THAT THE AIR FORCE AWARDED A CONTRACT UNDER
IFB-0205 ON MARCH 30.
DSG ESSENTIALLY PROTESTS IFB-0004 ON THE GROUNDS THAT SSI WAS
IMPROPERLY ALLOWED TO WAIVE ITS MISTAKE CLAIM RAISED AFTER BID OPENING
AND STAND ON ITS ORIGINAL BID.
WE SUSTAIN THE PROTEST UNDER IFB-0004. IN VIEW OF THIS CONCLUSION,
WE NEED NOT CONSIDER DSG'S PROTEST UNDER RFP NO. F65501-83-R-0025, WHICH
RESULTED IN THE AWARD OF THE SECOND INTERIM CONTRACT.
WE AGREE WITH DSG THAT SSI WAS IMPROPERLY ALLOWED TO WAIVE ITS CLAIM
OF MISTAKE AND STAND ON ITS ERRONEOUS BID WHICH WAS LOWER THAN DSG'S
BID. AT BID OPENING, 12 BIDS WERE RECEIVED. SSI WAS THIRD LOW WITH A
BID OF $3,683,000. DSG WAS FOURTH LOW WITH A BID OF $3,986,992.50. THE
LOW AND SECOND LOW BIDDERS CLAIMED MISTAKES IN THEIR BIDS AND WERE
ALLOWED TO WITHDRAW. SSI, NOW THE APPARENT LOW BIDDER, SUBMITTED A
MISTAKE IN BID CLAIM ON MARCH 15, 1983, AND REQUESTED PERMISSION TO
CHANGE ITS BID FROM $3,683,000 TO $4,229,445 BECAUSE: "IT APPEARS THAT
IN THE COMPUTATION OF OUR BID, IN ERROR THE OLD WAGE SCALE WAS USED AND
THE OTHER EXPENSES FOR G&A, SUPPLIES, ETC. WERE COMPLETELY LEFT OFF THE
BID." THE REQUEST WAS ACCOMPANIED BY WORKSHEETS WHICH WERE CERTIFIED BY
A NOTARY PUBLIC TO BE TRUE COPIES OF THE ORIGINALS. LESS THAN 1 MONTH
LATER, ON APRIL 5, 1983, SSI SUBMITTED A SECOND REQUEST TO MODIFY ITS
BID WHICH WAS ALSO ACCOMPANIED BY CERTIFIED WORKSHEETS. ON THIS LATER
DATE, THE PARTICULAR WORKSHEET WHICH HAD PREVIOUSLY BEEN SUBMITTED TO
ESTABLISH THAT SSI'S BID HAD OMITTED "OTHER EXPENSES FOR G&A, SUPPLIES,
ETC." IN THE SUM OF $143,000 PER YEAR (FOR THE BASE PERIOD AND 2 OPTION
YEARS) WAS, ITSELF, OMITTED. THIS OMISSION REDUCED THE REQUESTED CHANGE
FROM $4,229,445 TO $3,871,944.90 - A SUM LOWER THAN DSG'S BID OF
$3,986,992.50. SSI DID NOT FURNISH ANY EXPLANATION AS TO WHY IT OMITTED
(ON APRIL 5) "OTHER EXPENSES" WHICH IT HAD PREVIOUSLY CLAIMED ON MARCH
15.
WHERE THE MISTAKEN BIDDER SEEKS BOTH CORRECTION OF ITS MISTAKE AND
PERMISSION TO REMAIN IN THE PROCUREMENT, THE MISTAKE CLAIM MUST BE
DECIDED AT A HIGHER LEVEL THAN THE LOCAL PURCHASING ACTIVITY. IN THE
CASE OF THE AIR FORCE, IT MUST BE SUBMITTED TO THE STAFF JUDGE ADVOCATE
AT HEADQUARTERS, AIR FORCE LOGISTICS COMMAND (AFLC), FOR RESOLUTION.
THE CONTRACTING OFFICER, IN FORWARDING SSI'S REQUEST TO AFLC, ADVISED
AFLC THAT SSI HAD SUBMITTED TWO SEPARATE REQUESTS, THE FIRST CONTAINING
A CORRECTED DOLLAR AMOUNT HIGHER THAN THE SECOND. IT APPEARS, HOWEVER,
THAT AFLC WAS ONLY ASKED TO EVALUATE THE SECOND SUBMISSION, AND IT IS
NOT CLEAR WHETHER THE CONTRACTING OFFICER FURNISHED AFLC WITH SSI'S
FIRST SUBMISSION. AFLC FOUND CLEAR AND CONVINCING EVIDENCE OF A MISTAKE
IN SSI'S BID; HOWEVER, AFLC WAS UNABLE TO DETERMINE THE DOLLAR AMOUNT
OF THE BID SSI ACTUALLY INTENDED TO MAKE SO AS TO PERMIT CORRECTION OF
THE BID. THEREFORE, AFLC ADVISED THE CONTRACTING OFFICER THAT SSI WOULD
ONLY BE ALLOWED TO WITHDRAW ITS BID. WHEN SSI LEARNED OF THE AFLC
DETERMINATION, IT SENT A TELEX TO THE CONTRACTING OFFICER SAYING: "WE
HEREBY ACCEPT THE CONTRACT ..., BASED ON OUR ORIGINAL BID PRICE."
IT IS THE AIR FORCE'S POSITION THAT SSI SHOULD HAVE BEN PERMITTED TO
ACCEPT AWARD AT ITS ORIGINAL BID.
WE FIND THAT THE AIR FORCE HAD A REASONABLE BASIS TO CONCLUDE THAT,
WHILE IT WAS CLEAR THAT SSI HAD MADE AN ERROR IN ITS BID, THE EVIDENCE
WAS INSUFFICIENT TO SHOW THE INTENDED BID. THEREFORE, SSI'S CLAIM FOR
CORRECTION WAS PROPERLY DENIED.
WHERE A BIDDER ALLEGES A MISTAKE AFTER BID OPENING, THE BIDDER IS NOT
THEN FREE TO DECIDE TO WAIVE ITS MISTAKE CLAIM. TO PERMIT THE BIDDER TO
DO SO WOULD BE TO ALLOW THE BIDDER THE IMPERMISSIBLE OPTION OF EITHER
AFFIRMING ITS LOW BID OR WITHDRAWING IT, DEPENDING UPON WHICH APPEARED
TO BE IN ITS BEST INTEREST. 52 COMP.GEN. 258 (1972). HOWEVER, WE HAVE
PERMITTED AN EXCEPTION TO THE RULE AGAINST WAIVER IF IT IS CLEAR THAT
THE "INTENDED" BID WOULD HAVE BEEN THE LOWEST EVEN THOUGH THE AMOUNT OF
THE INTENDED BID COULD NOT BE CLEARLY PROVEN FOR THE PURPOSE OF BID
CORRECTION. BRUCE-ANDERSEN CO., INC., 61 COMP.GEN. 30 (1981), 81-2 CPD
310.
ALTHOUGH SSI HAS REQUESTED WAIVER OF ITS MISTAKE CLAIM, THERE IS NO
WAY OF DETERMINING WHETHER ITS "INTENDED" BID WOULD HAVE BEEN LOW GIVEN
SSI'S DISCREPANT CLAIM TOTALS OF MARCH 15 (WHICH SHOWED A BID HIGHER
THAN DSG'S BID) AND APRIL 5 (WHICH SHOWED A BID LOWER THAN DSG'S BID).
SINCE THERE IS NO WAY OF RESOLVING THE DISCREPANCY, WE DO NOT AGREE WITH
THE AIR FORCE'S POSITION THAT SSI SHOULD HAVE BEEN ALLOWED TO ACCEPT
AWARD AT ITS ORIGINAL BID. THEREFORE, DSG, AS THE NEXT LOW BIDDER, WAS
IN LINE FOR AWARD.
ACCORDINGLY, THE PROTEST IS SUSTAINED.
HOWEVER, AS NOTED ABOVE, AFTER TWO INTERIM CONTRACTS WERE AWARDED FOR
THE SERVICES, THE AIR FORCE FOUND IT NECESSARY TO AWARD A CONTRACT ON
MARCH 30, 1984, UNDER IFB-0205 FOR A BASE PERIOD AND TWO OPTION YEARS.
THEREFORE, IT IS NOT POSSIBLE TO RECOMMEND AWARD TO DSG UNDER THE
PROTESTED IFB. NEVERTHELESS, DSG MAY BE PAID BID PREPARATION COSTS UPON
PRESENTATION OF A SUBSTANTIATED CLAIM TO THE AIR FORCE.
B-210818, MAR 8, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. SMALL BUSINESS ADMINISTRATION HAS EXCLUSIVE AUTHORITY TO
DETERMINE THE SIZE STATUS OF SMALL BUSINESS FOR FEDERAL PROCUREMENT
PURPOSES, AND GAO WILL DISMISS ANY PROTEST ON THIS GROUND.
2. BELOW-COST BID PROVIDES NO BASIS FOR CHALLENGING THE AWARD OF A
GOVERNMENT CONTRACT TO A RESPONSIBLE PROSPECTIVE CONTRACTOR.
3. PROTEST AGAINST SPECIFICATIONS IN SOLICITATION, WHICH WERE
APPARENT PRIOR TO BID OPENING, IS UNTIMELY WHEN FILED AFTER BID OPENING.
EDWARDS ENTERPRISES, INC.:
EDWARDS ENTERPRISES, INC. (EDWARDS), PROTESTS THE AWARD OF A TOTAL
SMALL BUSINESS SET-ASIDE CONTRACT FOR ELMENDORF AIR FORCE BASE, ALASKA,
UNDER INVITATION FOR BIDS (IFB) NO. F66501-83-B-0004. EDWARDS CONTENDS
THAT ONE BIDDER, DGS OF JACKSON, MISSISSIPPI, IS NOT A SMALL BUSINESS
BECAUSE IT IS AFFILIATED WITH A LARGE BUSINESS AND THAT FIVE OF THE
BIDDERS HAVE BID TOO LOW TO BE ABLE TO PERFORM THE SERVICES REQUIRED BY
THE IFB. EDWARDS ALSO CONTENDS THAT THE AIR FORCE IMPROPERLY CHANGED
THE SPECIFICATIONS (ONE DINING HALL'S OPERATION WAS INCREASED FROM 5
DAYS PER WEEK TO 7 DAYS PER WEEK) AND THAT THE SPECIFICATIONS CONTAIN AN
INCONSISTENCY (ONE CLAUSE REQUIRING AN ATTENDANT IN BUILDING 41-700,
INFLIGHT KITCHEN, WHILE ANOTHER CLAUSE DOES NOT).
NONE OF THESE CONTENTIONS ARE FOR OUR REVIEW. UNDER 15 U.S.C. SEC.
637(B)(6) (1976), THE SMALL BUSINESS ADMINISTRATION HAS EXCLUSIVE
AUTHORITY TO DETERMINE THE SIZE STATUS OF SMALL BUSINESSES FOR FEDERAL
PROCUREMENT PURPOSES. DRAGON SERVICES, INC., B-208081, JULY 27, 1982,
82-2 CPD 86. MOREOVER, A BELOW-COST BID IS NOT A GROUND FOR CHALLENGING
THE AWARD OF A GOVERNMENT CONTRACT TO A RESPONSIBLE PROSPECTIVE
CONTRACTOR. DRAGON SERVICES, INC., SUPRA. FURTHER, EDWARDS' PROTEST
INDICATES THAT BIDS WERE OPENED PRIOR TO ITS PROTEST. OUR BID PROTEST
PROCEDURES REQUIRE THAT A PROTEST BASED UPON ALLEGED IMPROPRIETIES IN AN
IFB, WHICH IMPROPRIETIES ARE APPARENT PRIOR TO BID OPENING, MUST BE
FILED PRIOR TO BID OPENING. 4 C.F.R. SEC. 21 (1982); CALCULATOR
DIVISION OF CANON U.S.A., INC., B-207551.3, JULY 1, 1982, 82-2 CPD 7.
THE PROTEST IS DISMISSED.
B-210810, MAR 15, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST IS DISMISSED WHERE THE MATERIAL ISSUES ARE BEFORE A COURT OF
COMPETENT JURISDICTION, THE PROTESTER HAS NOT REQUESTED THAT THE COURT
SEEK A GAO OPINION ON THE MATTER BEFORE IT, AND THE COURT HAS NOT
OTHERWISE EXPRESSED INTEREST IN RECEIVING GAO'S VIEWS.
TADIRAN ISRAEL ELECTRONICS INDUSTRIES, LTD.:
TADIRAN ISRAEL ELECTRONICS INDUSTRIES, LTD. (TADIRAN), PROTESTS THE
AWARD OF A CONTRACT BY THE DEPARTMENT OF THE ARMY (ARMY) TO SAFT
AMERICA, INC., UNDER INVITATION FOR BIDS (IFB) NO. DAAB07-82-G142 FOR A
QUANTITY OF BATTERIES. TADIRAN ALLEGES IT SUBMITTED THE LOW BID BUT THE
ARMY ERRONEOUSLY APPLIED THE BUY AMERICAN ACT DIFFERENTIAL TO ITS BID
AND, AS A RESULT, IT WAS NO LONGER THE LOW BIDDER. TADIRAN ALLEGES THAT
ITS PRODUCT WAS, OR SHOULD HAVE BEEN, COVERED UNDER A MEMORANDUM OF
AGREEMENT BETWEEN ISRAEL AND THE UNITED STATES WHICH, IN EFFECT, WAIVES
THE APPLICATION OF THE BUY AMERICAN ACT AND, THUS, THAT TADIRAN WAS THE
LOW BIDDER.
WE WILL NOT CONSIDER THE PROTEST.
WHILE THE PROTEST WAS PENDING WITH THIS OFFICE, TADIRAN FILED A SUIT
IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA (CIVIL
ACTION NO. 83-0507), SEEKING PERMANENT INJUNCTIVE RELIEF. THE COURT'S
RESOLUTION OF THE ISSUE BEFORE IT, WHICH IS IDENTICAL TO THAT RAISED
HERE, WILL CONTROL THE RESOLUTION OF THE PROTEST. IT IS OUR POLICY NOT
TO DECIDE PROTESTS WHERE THE MATERIAL ISSUES ARE BEFORE A COURT OF
COMPETENT JURISDICTION UNLESS THE COURT REQUESTS, EXPECTS OR OTHERWISE
EXPRESSES AN INTEREST IN OUR VIEWS. 4 C.F.R. SEC. 21.10 (1982).
SINCE THE PROTESTER HAS NOT REQUESTED IN ITS COMPLAINT THAT THE COURT
SEEK OUR OPINION ON THE MATTER BEFORE IT AND, IN FACT, THE PROTESTER
INDICATES ITS INTEREST IN A JUDICIAL REMEDY, AND THE COURT HAS NOT
INDICATED AN INTEREST IN OUR DECISION, WE DISMISS THE PROTEST. SEE JOHN
C. GRIMBERG COMPANY, INC., B-209333, DECEMBER 15, 1982, 82-2 CPD 534;
NUMAX ELECTRONICS, INC., B-204632.3, JANUARY 22, 1982, 82-1 CPD 49.
B-210808, MAY 24, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
CONTRACTOR WHO PROVIDED UNAUTHORIZED SERVICES
AT REQUEST OF AGENCY EMPLOYEE MAY BE
PAID ON QUANTUM MERUIT BASIS BECAUSE SERVICES
CONSTITUTED A PERMISSIBLE PROCUREMENT,
GOVERNMENT RECEIVED AND ACCEPTED
THEIR BENEFIT, CONTRACTOR ACTED IN GOOD
FAITH, AND AMOUNT CLAIMED REPRESENTS
REASONABLE VALUE OF BENEFIT RECEIVED.
MCGRAW-HILL INFORMATION SYSTEMS COMPANY:
THE F.W. DODGE DIVISION OF THE MCGRAW-HILL INFORMATION SYSTEMS
COMPANY (MCGRAW-HILL) REQUESTS THAT THE GENERAL ACCOUNTING OFFICE (GAO)
AUTHORIZE PAYMENT OF A CLAIM FOR $92,954.25 FOR SERVICES PROVIDED TO THE
MINORITY BUSINESS DEVELOPMENT AGENCY, U.S. DEPARTMENT OF COMMERCE
(MBDA). MCGRAW-HILL'S CLAIM IS FOR INFORMATION SERVICES PROVIDED TO MBDA
FROM JANUARY 1 TO SEPTEMBER 30, 1981, AS AN "EXTENSION" OF A PREVIOUS
GRANT FROM THE DEPARTMENT OF COMMERCE, ALTHOUGH THERE WAS NEITHER A NEW
GRANT NOR A FORMAL CONTRACT FOR THE SERVICES PROVIDED DURING THIS
PERIOD. TO ASSIST US IN EVALUATING THIS MATTER WE REQUESTED AND HAVE
RECEIVED A REPORT FROM MBDA. BASED ON THIS INFORMATION AND OUR REVIEW,
IT IS OUR CONCLUSION THAT MCGRAW-HILL IS ENTITLED TO A QUANTUM MERUIT
RECOVERY OF THE AMOUNT CLAIMED.
FACTS
THE RECORD IN THIS CASE INDICATES THAT FOR SEVERAL YEARS PRIOR TO
1980, MBDA CONTRACTED WITH MCGRAW-HILL FOR CONSTRUCTION DATA FOR USE BY
MINORITY BUSINESSES. HOWEVER, IN 1980, GRANT FUNDING WAS USED INSTEAD
OF A CONTRACT. IN JANUARY 1980, MCGRAW-HILL RECEIVED A GRANT OF
$138,837 (GRANT NO. 98-20-60110-00) TO PROVIDE A COMPLETE INFORMATION
SYSTEM TO ASSIST MINORITY CONSTRUCTION CONTRACTORS FOR THE PERIOD
JANUARY 1 TO DECEMBER 30, 1980.
IN LATE 1980, THE PROCESS FOR A 1-YEAR RENEWAL OF THE GRANT WAS
BEGUN. IN FEBRUARY 1981, THE PROPOSED GRANT WAS SUBMITTED TO THE THEN
NEWLY FORMED DEPARTMENT OF COMMERCE FINANCIAL ASSISTANCE REVIEW BOARD.
ON MARCH 24, 1981, THE REVIEW BOARD RULED THAT A CONTRACT, RATHER THAN A
GRANT, SHOULD BE USED TO FUND THE INFORMATION SYSTEM. AT THAT POINT,
MBDA BEGAN PREPARATION OF THE PAPERWORK NECESSARY TO SUPPORT ISSUANCE OF
A CONTRACT.
ACCORDING TO MCGRAW-HILL'S SUBMISSION, BEGINNING IN DECEMBER 1980,
AND CONTINUING THROUGH EARLY 1981, MR. FRANK CARPENTER, THEN MBDA'S
NATIONAL DIRECTOR FOR CONSTRUCTION CONTRACTORS, REQUESTED THAT
MCGRAW-HILL CONTINUE TO PROVIDE INFORMATION SERVICES IN ANTICIPATION OF
RENEWAL OF THE 1980 GRANT. BASED ON THESE REQUESTS AND MR. CARPENTER'S
ASSURANCES THAT FUNDING WAS AVAILABLE, MCGRAW-HILL CONTINUED TO PROVIDE
THE SERVICES WITHOUT INTERRUPTION. IN JULY 1981, MCGRAW-HILL WAS
ADVISED BY AN MBDA OFFICIAL THAT THE SERVICES WOULD BE FUNDED THROUGH A
CONTRACT, RATHER THAN A GRANT RENEWAL.
ALSO IN JULY 1981, MR. CARPENTER RESIGNED FROM MBDA AND THE
INFORMATION SYSTEM PROJECT WAS REASSIGNED TO MR. ROY MIXON. IN LATE
AUGUST 1981, MR. MIXON MET WITH MCGRAW-HILL REPRESENTATIVES AND
REQUESTED A STATEMENT OF CHARGES THROUGH SEPTEMBER 30, 1981, ON WHICH
DATE MCGRAW-HILL WAS INSTRUCTED TO STOP PROVIDING THE INFORMATION
SERVICES. MCGRAW-HILL RESPONDED WITH A LETTER ITEMIZING THE SERVICES
PROVIDED THROUGH SEPTEMBER 30, 1981, AND QUOTING A TOTAL PRICE OF
$92,954.25.
APPLICABLE LAW
41 C.F.R. SEC. 1-1.405 AUTHORIZES FEDERAL AGENCIES TO RATIFY
UNAUTHORIZED COMMITMENTS UNDER CERTAIN CIRCUMSTANCES. THE REGULATION
PROVIDES:
"EXECUTION OF OTHERWISE PROPER CONTRACTS
MADE BY INDIVIDUALS WITHOUT CONTRACTING
AUTHORITY, OR BY CONTRACTING OFFICERS IN EXCESS
OF THE LIMITS OF THEIR DELEGATED AUTHORITY,
MAY BE LATER RATIFIED. TO BE EFFECTIVE,
SUCH RATIFICATION MUST BE IN THE FORM OF A
WRITTEN DOCUMENT CLEARLY STATING THAT RATIFICATION
OF A PREVIOUSLY UNAUTHORIZED ACT IS
INTENDED AND MUST BE SIGNED BY A PERSON AUTHORIZED
TO RATIFY SUCH ACTS. GENERALLY SUCH
RATIFICATION MAY BE MADE ONLY BY AN OFFICIAL
ON WHOSE BEHALF THE CONTRACT WAS MADE AND
THEN ONLY (A) IF HE COULD HAVE GIVEN AUTHORITY
TO ENTER INTO THE CONTRACT BEFORE IT WAS
AWARDED AND (B) IF HE STILL HAS POWER TO DO
SO AT THE TIME OF RATIFICATION."
IN APPLYING THIS PROVISION, THERE HAS BEEN SOME VARIATION IN HOW
AGENCIES HAVE INTERPRETED "OTHERWISE PROPER CONTRACTS."
IN OUR VIEW "OTHERWISE PROPER" DOES NOT NECESSARILY CONNOTE
"OTHERWISE PERFECT." WHERE THE RATIFICATION IS OF A CONTRACT MADE BY AN
UNAUTHORIZED, AND PRESUMABLY INEXPERIENCED, INDIVIDUAL, PROCEDURAL
DEFECTS (IN ADDITION TO THE LACK OF AUTHORITY) ARE NOT UNLIKELY.
THEREFORE, IF SEC. 1-1.405 IS TO HAVE ANY PRACTICAL APPLICATION,
RATIFICATION OF AN UNAUTHORIZED CONTRACT WHICH ALSO CONTAINS OTHER MINOR
DEVIATIONS MUST BE CONSIDERED WITHIN THE SCOPE OF AGENCY DISCRETION. ON
THE OTHER HAND, IF THE DEFECTS ARE SUCH THAT THE CONTRACT COULD NOT HAVE
BEEN PROPERLY MADE AT THE TIME, SEC. 1-1.405 RATIFICATION IS
INAPPROPRIATE.
AS AN ADMINISTRATIVE DETERMINATION, RATIFICATION DOES NOT REQUIRE
GAO'S APPROVAL OR CERTIFICATION. IF AN AGENCY DECIDES NOT TO RATIFY AN
UNAUTHORIZED CONTRACT, HOWEVER, AND PAYMENT IS REQUESTED BY THE
CONTRACTOR, REFERRAL FOR GAO'S CONSIDERATION IS THE REQUIRED PROCEDURE.
THERE IS A WELL-ESTABLISHED RULE THAT THE GOVERNMENT IS NOT BOUND BY
THE UNAUTHORIZED ACTS OF ITS EMPLOYEES. (FEDERAL CROP INSURANCE CORP.
V. MERRILL, 332 U.S. 380 (1947).) WHERE A VALID WRITTEN CONTRACT WAS
NEVER EXECUTED AND THE AGENCY IS UNABLE TO RATIFY THE INFORMAL AGREEMENT
RETROACTIVELY, THE GOVERNMENT HAS NO LEGAL OBLIGATION TO PAY CONTRACTORS
WHO HAVE PROVIDED GOODS AND SERVICES. HOWEVER, UNDER GAO'S CLAIMS
SETTLEMENT AUTHORITY (31 U.S.C. SEC. 3702), THE COMPTROLLER GENERAL MAY
AUTHORIZE PAYMENT ON A QUANTUM MERUIT BASIS.
WHERE A PERFORMANCE BY ONE PARTY HAS BENEFITED ANOTHER, EVEN IN THE
ABSENCE OF AN ENFORCEABLE CONTRACT BETWEEN THEM, EQUITY REQUIRES THAT
THE PARTY RECEIVING THE BENEFIT SHOULD NOT GAIN A WINDFALL AT THE
EXPENSE OF THE PERFORMING PARTY. THE LAW THUS IMPLIES A PROMISE TO PAY
BY THE RECEIVING PARTY WHATEVER THE SERVICES ARE REASONABLY WORTH. SEE,
E.G., BOUTERIE V. CARRE, 6 SO.2D 218, 220 (LA.APP. 1942); KINTZ V.
READ, 626 P.2D 52, 55 (WASH.APP. 1981). BEFORE GAO WILL AUTHORIZE A
QUANTUM MERUIT OR QUANTUM VALEBAT PAYMENT, WE MUST MAKE A THRESHOLD
DETERMINATION THAT THE GOODS OR SERVICES WOULD HAVE BEEN A PERMISSIBLE
PROCUREMENT, HAD THE FORMAL PROCEDURAL BEEN FOLLOWED. NEXT WE MUST FIND
THAT (1) THE GOVERNMENT RECEIVED AND ACCEPTED A BENEFIT, (2) THE
CONTRACTOR ACTED IN GOOD FAITH, AND (3) THE AMOUNT CLAIMED REPRESENTS
THE REASONABLE VALUE OF THE BENEFIT RECEIVED. SEE 33 COMP.GEN. 533, 537
(1954), 40 COMP.GEN. 447, 451
AS OUTLINED ABOVE, THIS CASE DOES NOT INVOLVE AN UNAUTHORIZED OR
PROCEDURALLY DEFECTIVE CONTRACT, BUT RATHER A SITUATION WHERE A
CONTRACT, ALTHOUGH PROMISED, WAS NEVER ISSUED. HOWEVER, WHETHER A
CONTRACT IS UNAUTHORIZED, PROCEDURALLY DEFECTIVE, OR NONEXISTENT THE
GOODS OR SERVICES PROVIDED ARE SIMILARLY UNAUTHORIZED. ABSENT AGENCY
RATIFICATION, PAYMENT FOR SUCH GOODS OR SERVICES WILL DEPEND ON WHETHER
WE FIND A QUANTUM MERUIT RECOVERY APPROPRIATE. IN THIS CASE
ADMINISTRATIVE RATIFICATION WAS CONSIDERED, BUT MBDA DECIDED NOT TO
RATIFY MR. CARPENTER'S UNAUTHORIZED COMMITMENT TO MCGRAW-HILL. IN
DECEMBER 1982, MBDA FORMALLY DECLINED PAYMENT OF THE CLAIMED AMOUNT, AND
REFERRED MCGRAW-HILL TO GAO.
FIRST, WE HAVE NO REASON TO QUESTION THAT THE PROCUREMENT WOULD HAVE
BEEN PERMISSIBLE HAD PROPER PROCEDURES BEEN FOLLOWED. MCGRAW-HILL HAD
IN FACT PROVIDED SIMILAR SERVICES BY CONTRACT FOR SEVERAL YEARS
PREVIOUSLY, AND WE ARE AWARE OF NO STATUTORY OR OTHER LEGAL IMPEDIMENT.
THE DECISION TO RETURN TO THE USE OF A PROCUREMENT CONTRACT AFTER THE
1-YEAR "DEVIATION" TO THE USE OF A GRANT WAS, WE ASSUME, MADE IN ORDER
TO COMPLY WITH THE FEDERAL GRANT AND COOPERATIVE AGREEMENT ACT, 31 U.S.
C. SECS. 6301-08. THIS, IN OUR OPINION, WAS THE CORRECT DECISION. SEE
61 COMP.GEN. 637 (1982).
NEXT, MBDA HAS DETERMINED THAT A BENEFIT WAS RECEIVED AND ACCEPTED BY
THE GOVERNMENT AS A RESULT OF MCGRAW-HILL'S SERVICES; THAT ALTHOUGH
AWARE OF THE RISKS OF PERFORMING WITHOUT A WRITTEN AGREEMENT,
MCGRAW-HILL ACTED IN GOOD FAITH IN DELIVERING THE SERVICES; AND THAT
THE AMOUNT CLAIMED REPRESENTS THE REASONABLE VALUE OF THE SERVICES
RECEIVED. BASED ON OUR REVIEW OF THE RECORD, WE CONCUR IN MBDA'S
FINDINGS.
ACCORDINGLY, PAYMENT OF $92,954.25 TO MCGRAW-HILL IS AUTHORIZED. AS
A BONA FIDE NEED OF THE YEAR IN WHICH THE SERVICES WERE RENDERED, THIS
EXPENDITURE IS A PROPER CHARGE AGAINST MBDA'S APPROPRIATION FOR FISCAL
YEAR 1981. B-207557, JULY 11, 1983.
B-210807, MAR 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST FILED WITH GAO MORE THAN 10 WORKING DAYS AFTER RECEIPT OF
INITIAL ADVERSE AGENCY ACTION ON A PROTEST TO THE AGENCY IS UNTIMELY AND
WILL NOT BE CONSIDERED.
A-E SYSTEMS MANAGEMENT, INC.:
A-E SYSTEMS MANAGEMENT, INC., PROTESTS THE AWARD OF A CONTRACT TO ANY
OTHER FIRM UNDER SOLICITATION NO. CPSC-P-82-1234
WE DISMISS THE PROTEST AS UNTIMELY FILED.
THE CONTRACT IN QUESTION WAS AWARDED ON SEPTEMBER 30, 1982. A-E
SYSTEMS BECAME AWARE OF THIS AWARD WHEN CPSC NOTIFIED UNSUCCESSFUL
OFFERORS ON OCTOBER 15. ON OCTOBER 19, A-E SYSTEMS FILED A PROTEST WITH
CPSC. AN OCTOBER 27 LETTER FROM CPSC RESPONDED ADVERSELY TO A-E
SYSTEMS' AGENCY PROTEST, AND OUTLINED THE SPECIFIC REASONS WHY A-E
SYSTEMS' PROPOSAL WAS REJECTED. A-E SYSTEMS MADE SEVERAL APPEALS TO
CPSC, INCLUDING A DECEMBER 27 LETTER TO WHICH CPSC RESPONDED ON JANUARY
20, 1983. THE PROTEST TO GAO WAS FILED ON FEBRUARY 16, 1983.
OUR BID PROTEST PROCEDURES AT 4 C.F.R. SEC. 21.2(A) (1982) PROVIDE
THAT ONCE A PROTEST HAS BEEN TIMELY FILED WITH THE CONTRACTING AGENCY,
ANY SUBSEQUENT PROTEST TO THE COMPTROLLER GENERAL MUST BE FILED WITHIN
10 WORKING DAYS OF ACTUAL OR CONSTRUCTIVE KNOWLEDGE OF INITIAL ADVERSE
ACTION REGARDING THE PROTEST.
CPSC'S OCTOBER 27 RESPONSE TO A-E SYSTEMS' AGENCY PROTEST IS THE
INITIAL ADVERSE AGENCY ACTION. CONSEQUENTLY, A-E SYSTEMS' DELAY IN
FILING ITS PROTEST WITH OUR OFFICE UNTIL FEBRUARY 16 RENDERS THE PROTEST
UNTIMELY.
THE PROTEST IS DISMISSED.
B-210806, FEB 14, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
1. CONTENTION THAT SOLICITATION SPECIFICATIONS
ARE IMPROPER IN THAT THEY CONTAIN DESIGN FEATURES PATENTED BY
PROTESTER'S SUPPLIER IS UNTIMELY BECAUSE PROTEST WAS NOT FILED
UNTIL AFTER THE CLOSING DATE FOR RECEIPT OF INITIAL PROPOSALS.
2. THE DETERMINATION OF THE RELATIVE MERITS OF
OFFERORS' TECHNICAL PROPOSALS IS PRIMARILY THE RESPONSIBILITY OF
THE PROCURING AGENCY AND WILL BE QUESTIONED BY GAO ONLY UPON A
CLEAR SHOWING OF UNREASONABLENESS, ABUSE OF DISCRETION OR
VIOLATION OF PROCUREMENT STATUTES OR REGULATIONS. PROTEST IS
DENIED WHERE RECORD EVIDENCES A REASONABLE BASIS FOR PROCURING
AGENCY'S CONCLUSION THAT AWARDEE, WHOSE FIRM FIXED PRICE WAS
APPROXIMATELY 10 PERCENT BELOW THE PROTESTER'S, ALSO SUBMITTED THE
TECHNICALLY SUPERIOR PROPOSAL.
3. GAO DOES NOT REVIEW CONTRACTING OFFICERS'
AFFIRMATIVE DETERMINATIONS OF RESPONSIBILITY EXCEPT IN LIMITED
CIRCUMSTANCES NOT SHOWN TO BE PRESENT IN THIS CASE.
GEORGETOWN AIR & HYDRO SYSTEMS:
GEORGETOWN AIR & HYDRO SYSTEMS PROTESTS THE AWARD OF A CONTRACT TO
ILC DOVER UNDER REQUEST FOR PROPOSALS (RFP) NO. DAAK70-83-R-0007, ISSUED
BY THE U.S. ARMY MOBILITY EQUIPMENT RESEARCH AND DEVELOPMENT COMMAND
(MERADCOM), FT. BELVOIR, VIRGINIA, FOR AN AIR BAG SYSTEM FOR LIFTING A
TRANSPORT CRAFT. GEORGETOWN MAINTAINS THAT THE RFP SPECIFICATIONS ARE
BASED UPON PATENTS HELD BY ITS SUPPLIER; THAT PERFORMANCE OF THE
CONTRACT BY ILC DOVER WILL ENTAIL INFRINGEMENT OF THOSE PATENTS; THAT
GEORGETOWN SHOULD HAVE BEEN AWARDED THE CONTRACT AS THE "LOW RESPONSIVE
BIDDER"; THAT THE ARMY ERRED IN ITS EVALUATION OF RESPONSES TO THE RFP
AND THAT ILC DOVER IS INCAPABLE OF SATISFACTORILY PERFORMING THE
CONTRACT. FOR THE REASON STATED BELOW, WE DISMISS THE PROTEST IN PART
AND DENY IT IN PART.
BACKGROUND
THE LIGHTER, AIR CUSHION VEHICLE, 30-TON CAPACITY (LACV-30) IS A
CRAFT APPROXIMATELY 80 FEET LONG BY 40 FEET WIDE WHICH HAS A GROSS
WEIGHT WHEN LOADED OF 120,000 POUNDS. THE CRAFT DOES NOT HAVE AN
INTEGRAL JACKING SYSTEM TO RAISE IT SO THAT UNDERHULL AND SKIRT
INSPECTION AND REPAIR CAN BE PERFORMED. THE OBJECTIVE OF THIS RFP IS TO
PERFECT A METHOD FOR LIFTING THE CRAFT WHICH IS MORE ECONOMICAL AND
EFFICIENT THAN OTHER CURRENTLY AVAILABLE METHODS SUCH AS THE USE OF
STRADDLE CRANES OR DRY DOCK FACILITIES. THE CONCEPT CONTAINED IN THIS
RFP IS TO PLACE BENEATH THE CRAFT SEVERAL LARGE, DEFLATED AIR BAGS WHICH
ARE CONNECTED TO A SOURCE OF COMPRESSED AIR, WHICH IS REGULATED AND
MONITORED BY A MANIFOLD. WHEN THE BAGS ARE INFLATED, THEY ARE TO RAISE
THE CRAFT SUFFICIENTLY SO THAT 48 55-GALLON OIL DRUMS MAY BE PLACED
BENEATH IT. THE DRUMS SUPPORT THE CRAFT WHILE THE WORK IS BEING
PERFORMED. WHEN THE WORK IS COMPLETE, THE PROCESS IS REVERSED TO PERMIT
THE REMOVAL OF THE DRUMS, THEN THE BAGS, AND THE RETURN OF THE CRAFT TO
SERVICE. THIS PROCUREMENT IS FOR ONE COMPLETE AIR BAG SYSTEM, INCLUDING
SUPPORTING DATA AND TEST AND SAFETY ASSESSMENT REPORTS.
THE RECORD IN THIS CASE SHOWS THAT THE CONCEPT OF USING AIR BAGS TO
LIFT THIS CRAFT HAS BEEN EXPLORED FOR A DECADE. AMONG THESE EFFORTS,
THE ARMY STATES, IS AN INFORMATION SEARCH IT CONDUCTED IN 1979 TO FIND A
STATE-OF-THE-ART LIFTING BAG SYSTEM FOR THE LACV-30 PROGRAM.
INFORMATION WAS OBTAINED FROM SEVERAL SOURCES, INCLUDING THE PROTESTER,
WHICH IS THE MANUFACTURER'S REPRESENTATIVE TO THE UNITED STATES
GOVERNMENT FOR A WEST GERMAN PRODUCER OF AIR BAGS, VETTER PRODUKTIONS
GMBH. IN 1979, GEORGETOWN VOLUNTEERED AT NO OBLIGATION TO THE
GOVERNMENT TO DEMONSTRATE A VETTER HIGH-PRESSURE BAG, WHICH PROVED
UNSUITABLE FOR THE PURPOSE. ALSO IN 1979, GEORGETOWN SUBMITTED TO THE
ARMY AN "UNSOLICITED PROPOSAL" WHICH THE ARMY STATES IT DECLINED TO
CONSIDER ON THE BASES THAT THE PROPOSAL DID NOT REPRESENT A NEW OR
INNOVATIVE IDEA AND BECAUSE GEORGETOWN TOOK ADVANTAGE OF INFORMATION IT
HAD OBTAINED CONCERNING A FORTHCOMING SOLICITATION. IN 1980, THE ARMY
ISSUED A REQUEST FOR PROPOSALS FOR AN AIR BAG LIFTING SYSTEM, TO WHICH
ONLY ONE OFFEROR - GOODYEAR - RESPONDED. GOODYEAR'S BAG WAS TOO LARGE TO
BE USED FOR THE LACV-30 PROGRAM AND THE SOLICITATION WAS CANCELED. IN
1981, GEORGETOWN SUBMITTED LITERATURE TO THE ARMY DESCRIBING A NEW
LOW-PRESSURE, MULTI-CELLED VETTER LIFTING BAG. IN 1983, THE ARMY
STATES, "AS A RESULT OF CHANGES IN THE STATE-OF-THE-ART IN LIFTING BAG
SYSTEMS AVAILABLE COMMERCIALLY," IT ISSUED THE PRESENT SOLICITATION, RFP
-0007, WITH PERFORMANCE-TYPE SPECIFICATIONS INTENDED TO REFLECT THE
CAPABILITIES OF LIFTING BAG SYSTEMS IN THE COMMERCIAL MARKET. (WE FIND
THE SPECIFICATION TO BE A MIXTURE OF PERFORMANCE REQUIREMENTS AND SOME
DESIGN CHARACTERISTICS, SUCH AS "MULTI-CELL CONSTRUCTION WITH INTERNAL
WEBBING ATTACHING TOP AND BOTTOM SURFACES OF EACH CELL.")
RFP -0007
RFP -0007 IS FOR THE SUPPLY OF ONE AIR BAG SYSTEM FOR LIFTING ONE
LACV-30 CRAFT, TOGETHER WITH A SPARE PARTS LIST, AN OPERATOR'S MANUAL, A
TEST AND DEMONSTRATION REPORT AND A SAFETY ASSESSMENT REPORT. WITH
RESPECT TO THE CONTENT OF THE TECHNICAL PROPOSALS WHICH WERE TO BE
SUBMITTED IN RESPONSE TO THE RFP, THE SOLICITATION STATED IN SECTION L.
6 THAT PROPOSALS "SHALL INCLUDE THE FOLLOWING:"
"(A) THE ORIGINAL SIGNED COPY OF STANDARD
FORM 33 PAGES 1 THROUGH 43.
(B) TWO (2) COMPLETED COPIES OF DD FORM
1423 (CONTRACT DATA REQUIREMENTS
LIST), MARKED EXHIBIT A.
(C) COST/PRICING DATA AS LISTED IN L.8.
(D) TWO (2) COPIES OF YOUR TECHNICAL
APPROACH OR PROPOSED METHOD OF
ACCOMPLISHING THE WORK AND SERVICES CALLED FOR HEREUNDER.
(E) TWO (2) COPIES OF YOUR QUALIFICATIONS
TO PERFORM THE PROPOSED WORK AND
SERVICES (TO INCLUDE RESUMES FOR THE
SCIENTIFIC/TECHNICAL PERSONNEL
PROPOSED FOR THE PROGRAM).
(F) ONE (1) COPY OF YOUR LATEST CERTIFIED
FINANCIAL STATEMENT TO ENABLE EVALUATION
OF YOUR FINANCIAL CAPABILITY.
OFFEROR'S FAILURE TO FURNISH THE ABOVE INFORMATION
MAY RESULT IN THE PROPOSAL NOT BEING
CONSIDERED FOR NEGOTIATION/AWARD."
SECTIONS M.1 THROUGH M.4 PROVIDED FOR THE EVALUATION OF PROPOSALS AS
FOLLOWS:
"M.1 BASIS FOR AWARD
AWARD WILL BE MADE TO THAT RESPONSIBLE
OFFEROR WHO SUBMITS A PROPOSAL THAT MEETS
THE MINIMUM TECHNICAL REQUIREMENTS AT THE
LOWEST EVALUATED PRICE. PROPOSALS SHOULD BE
SUBMITTED INITIALLY ON THE MOST FAVORABLE
TERMS FROM TECHNICAL AND PRICE VIEWPOINTS.
"M.2 EVALUATION FACTORS
PROPOSALS WILL BE EVALUATED ON THE
BASIS OF TECHNICAL PROPOSALS AND PRICE.
TECHNICAL PROPOSALS WILL BE WEIGHTED
APPROXIMATELY 3/4 AND PRICE WILL BE WEIGHTED
APPROXIMATELY 1/4 IN THE EVALUATION. PRICE
SHALL BE EVALUATED BASED ON THE LOWEST
EVALUATED PRICE. NEGOTIATIONS SHALL BE
CONDUCTED WITH THOSE OFFERORS IN A COMPETITIVE RANGE.
"M.3 EVALUATION OF TECHNICAL PROPOSALS
A. TECHNICAL PROPOSALS WILL BE EVALUATED
FOR THE PURPOSE OF DETERMINING AN OFFEROR'S
ABILITY TO PERFORM IN ACCORDANCE WITH THE
TECHNICAL REQUIREMENTS SET FORTH IN THIS
SOLICITATION. THE DATA SUBMITTED BY
OFFERORS IN RESPONSE TO PARAGRAPH L.6 OF
THIS SOLICITATION IS THE FUNDAMENTAL SOURCE
OF INFORMATION UPON WHICH THE TECHNICAL EVALUATION IS BASED.
B. INASMUCH AS YOUR TECHNICAL PROPOSAL WILL
PRIMARILY DETERMINE THE CAPABILITY OF YOUR
FIRM TO PARTICIPATE IN THIS PROGRAM, IT
SHOULD BE SPECIFIC AND COMPLETE IN EVERY
DETAIL. IT SHOULD INCLUDE YOUR PROPOSED
METHOD OF APPROACH FOR PERFORMING ALL WORK
REQUIRED TO SATISFY THE GOVERNMENT'S
REQUIREMENTS SET FORTH ELSEWHERE IN THIS
SOLICITATION. THE TECHNICAL PROPOSAL SHALL
NOT MERELY OFFER TO COMPLY WITH THE
GOVERNMENT'S REQUIREMENTS BUT SHALL PRESCRIBE THE
APPROACH PLANNED TO BE USED. INDICATE IN
YOUR PROPOSAL IF THE PROPOSED SYSTEM IS A
DEVELOPMENTAL OR COMMERCIAL ITEM.
C. PROPOSALS SHOULD INCLUDE A DISCUSSION OF
THE AREAS OF CONCERN SHOWN BELOW. STATEMENTS
WHICH SIMPLY STATE THAT THE OFFEROR
WILL FULFILL THE GOVERNMENT'S REQUIREMENTS
SHALL BE REASON FOR DETERMINING THE FIRM'S
PROPOSAL TO BE UNACCEPTABLE.
D. TECHNICAL EVALUATION SUBFACTORS LISTED
BELOW SHALL BE THE BASIS FOR TECHNICAL
EVALUATIONS. SUBFACTORS 1-4 ARE EQUALLY
WEIGHTED AND COMPRISE APPROXIMATELY 2/5 OF
THE TOTAL EVALUATION. SUBFACTORS 5-9 ARE
EQUALLY WEIGHTED AND COMPRISE APPROXIMATELY
1/4 OF THE TOTAL EVALUATION. SUBFACTORS
10-12 ARE APPROXIMATELY EQUALLY WEIGHTED AND
SHALL COMPRISE THE REMAINDER OF THE POINTS.
(1) ABILITY TO MEET THE REQUIRED DELIVERY SCHEDULE
(2) SYSTEM WEIGHT: LOWER WEIGHTS SHALL BE GIVEN HIGHER
RATINGS
(3) OVERLOAD LIFT CAPACITY
(4) LONG TERM SERVICE LIFE IN SAND AND SALT ENVIRONMENT,
COMPATIBILITY WITH OIL, SUN, SAND, ETC.
(5) EXPERIENCE IN SIMILAR OR RELATED FIELDS. IDENTIFY
ANY CURRENT OR RECENTLY COMPLETED GOVERNMENT CONTRACTS
IN A SIMILAR FIELD.
(6) COLLAPSED HEIGHT OF BAGS: LOWER HEIGHTS SHALL
RECEIVE HIGHER RATINGS.
(7) TIME REQUIRED TO EFFECT LIFT: SYSTEMS REQUIRING LESS
TIME SHALL RECEIVE HIGHER RATINGS.
(8) MANPOWER REQUIRED TO EFFECT LIFT: SYSTEMS REQUIRING
LESS MANPOWER SHALL BE GIVEN PREFERENCE.
(9) SAFETY EVALUATION
(A) MATERIAL AND DESIGN FEATURES
(B) PROCEDURE AND OPERATIONAL CONCEPTS
(10) LONG TERM SHELF LIFE
(11) SUITABILITY FOR TEMPERATURE RANGE -40F TO 115F
(12) GENERAL QUALITY AND RESPONSIVENESS OF PROPOSAL
(A) COMPLETENESS AND THOROUGHNESS
(B) CLARITY
(C) RESPONSIVENESS TO TERMS
"M.4 EVALUATION OF PRICE
PRICE SHALL BE WEIGHTED APPROXIMATELY 1/4 IN
THE EVALUATION PRICE. EVALUATION SHALL BE
BASED UPON THE LOWEST EVALUATED PRICE TO THE
GOVERNMENT IN ACCORDANCE WITH M.1 AND M.2 OF
THIS SOLICITATION."
THREE FIRMS SUBMITTED OFFERS IN RESPONSE TO THE RFP AND THE TECHNICAL
PROPOSALS WERE REFERRED TO THE MERADCOM PROJECT ENGINEER FOR EVALUATION.
THE ENGINEER HAD QUESTIONS CONCERNING EACH OF THE PROPOSALS AND HAD A
CONTRACT SPECIALIST TELEPHONE EACH OF THE OFFERORS FOR CLARIFICATION OF
CERTAIN FEATURES IN THEIR PROPOSALS. GEORGETOWN WAS REQUESTED TO
CLARIFY ITS PROPOSAL WITH REGARD TO BAG WEIGHT, MAXIMUM COLLAPSED
HEIGHT, SHELF LIFE, AND FOOTPRINT OF THE BAG. GEORGETOWN RESPONDED TO
THESE QUESTIONS AND THE CONTRACT SPECIALIST REPORTED THIS ADDITIONAL
INFORMATION, AS WELL AS CLARIFICATIONS RECEIVED FROM THE OTHER OFFERORS,
TO THE ENGINEER FOR HIS CONSIDERATION. THE ENGINEER THEN REVIEWED THE
PROPOSALS AND RANKED THE OFFERORS AS FOLLOWS:
OFFER TECHNICAL TOTAL
OFFEROR PRICE EVALUATION SCORE
ILC DOVER $89,108 ACCEPTABLE 93 PERCENT
GOODYEAR AEROSPACE
CORP. $85,907 FN1 ACCEPTABLE 84 PERCENT
GEORGETOWN $96,600 ACCEPTABLE 83 PERCENT
THE ENGINEER THEN INFORMED THE CONTRACT SPECIALIST OF THE
DEFICIENCIES FOUND IN EACH PROPOSAL AND THE SPECIALIST IN TURN RELATED
THIS INFORMATION TO THE OFFERORS AND REQUESTED BEST AND FINAL OFFERS.
THE SPECIALIST ADVISED GEORGETOWN OF THREE DEFICIENCIES IN ITS PROPOSAL:
(1) PROPOSED METHODS OF MEETING DELIVERY AND SAFETY REQUIREMENTS SHOULD
BE ADDRESSED; (2) PROPOSED MANIFOLD SYSTEM SHOULD BE ADDRESSED IN
DETAIL; AND (3) ALL TESTING REQUIREMENTS CITED IN THE SOLICITATION
SHOULD BE INCORPORATED INTO THE RESULTING CONTRACT. GEORGETOWN'S
RESPONSE TO THESE DEFICIENCIES IN ITS BEST AND FINAL OFFER WAS DEEMED
UNSATISFACTORY AND CONSEQUENTLY GEORGETOWN DID NOT IMPROVE ON ITS
ORIGINAL TECHNICAL EVALUATION, WHEREAS IN ITS BEST AND FINAL OFFER ILC
DOVER CORRECTED AN OMITTED CERTIFICATION AND LOWERED ITS PRICE TO
$86,075, THUS IMPROVING ITS OFFER. GOODYEAR'S BEST AND FINAL OFFER
STATED THAT ITS OFFER REMAINED AS PRESENTED IN ITS INITIAL PROPOSAL.
SINCE ILC DOVER'S OFFER WAS RATED AS THE HIGHEST TECHNICALLY ACCEPTABLE
AND HAD THE SECOND LOWEST COST, THE CONTRACT WAS AWARDED TO THAT FIRM.
DISCUSSION
UPON BEING ADVISED OF THE AWARD TO ILC DOVER, GEORGETOWN FILED A
PROTEST WITH OUR OFFICE IN WHICH IT ALLEGED THAT (1) THE RFP
SPECIFICATIONS WERE BASED ON VETTER PATENTS AND PERFORMANCE OF THE
CONTRACT BY ILC DOVER WOULD ENTAIL INFRINGEMENT OF THOSE PATENTS AND (2)
THAT GEORGETOWN WAS ENTITLED TO THE AWARD AS "THE LOW RESPONSIVE
BIDDER."
TO THE EXTENT THAT GEORGETOWN'S FIRST ALLEGATION IS THAT THE
SPECIFICATIONS ARE IMPROPER, ITS PROTEST IS UNTIMELY. A PROTEST BASED
UPON AN ALLEGED IMPROPRIETY IN A REQUEST FOR PROPOSALS MUST BE FILED
PRIOR TO THE CLOSING DATE FOR RECEIPT OF INITIAL PROPOSALS. 4 C.F.R.
SEC. 21.2(B)(1) (1983). GEORGETOWN'S PROTEST WAS NOT FILED UNTIL AFTER
IT WAS NOTIFIED OF THE AWARD OF THE CONTRACT. MOREOVER, WE NOTE THAT THE
PROTESTER, DESPITE REQUESTS FROM THE ARMY THAT IT DO SO, HAS YET TO
IDENTIFY THE SPECIFICATION PROVISIONS OR PARTICULAR PATENTS THAT FORM
THE BASIS FOR ITS ALLEGATION. IN ADDITION, WE POINT OUT THAT THE
EXCLUSIVE REMEDY FOR ACTUAL PATENT INFRINGEMENT RESULTING FROM
PERFORMANCE OF A GOVERNMENT CONTRACT IS A SUIT FOR MONEY DAMAGES AGAINST
THE GOVERNMENT IN THE UNITED STATES CLAIMS COURT. 28 U.S.C. SEC. 1498
(1976). THE PROTEST IS DISMISSED AS TO GEORGETOWN'S FIRST GROUND OF
PROTEST.
IN RESPONSE TO GEORGETOWN'S SECOND ALLEGATION THAT IT SHOULD HAVE
RECEIVED THE AWARD AS "THE LOW RESPONSIVE BIDDER," THE ARMY SUBMITTED A
REPORT IN WHICH IT DISCUSSED THE CRITERIA FOR PROPOSAL EVALUATION, WHICH
WE HAVE QUOTED ABOVE, ITS EVALUATION OF THE PROPOSALS AND WHY IT
CONCLUDED THAT ILC DOVER SHOULD RECEIVE THE AWARD: THAT FIRM RECEIVED
THE HIGHEST TECHNICAL RANKING AND ITS FIRM FIXED PRICE WAS ONLY $168
ABOVE GOODYEAR'S ESTIMATED COST PLUS FIXED FEE AND WAS $10,525 BELOW
GEORGETOWN'S FIRM FIXED PRICE.
GEORGETOWN EXPANDED UPON ITS PROTEST UPON RECEIVING THE ARMY'S
REPORT; THE ARMY SUBMITTED A SUPPLEMENTAL REPORT AND GEORGETOWN FILED
COMMENTS ON THAT REPORT. OUR DISCUSSION BELOW SUMMARIZES ALL OF THESE
SUBMISSIONS. IN BROAD OUTLINE, GEORGETOWN MAINTAINS THAT THE ARMY'S
EVALUATION OF PRICE WAS FLAWED IN THAT GOODYEAR'S ESTIMATED COST PLUS
FIXED FEE OF $85,907 SHOULD NOT HAVE BEEN SCORED HIGHER THAN
GEORGETOWN'S FIRM FIXED PRICE OF $96,600, AND THAT ILC DOVER'S FIRM
FIXED PRICE OF $86,075 WAS ONLY AN "ESTIMATE"; THAT THE TECHNICAL
EVALUATION WAS IN ERROR, PERHAPS AS THE RESULT OF PERSONAL BIAS ON THE
PART OF THE ARMY'S EVALUATOR, SO THAT ILC DOVER RECEIVED HIGHER SCORES
AND GEORGETOWN LOWER SCORES THAN THEY SHOULD HAVE; AND THAT ILC DOVER
IS INCAPABLE OF SUCCESSFULLY PERFORMING THE CONTRACT ON SCHEDULE.
WITH REGARD TO THE FIRST OF THESE ISSUES - THE PROPRIETY OF THE PRICE
EVALUATION - WE BELIEVE THERE IS SOME MERIT TO GEORGETOWN'S ARGUMENT
CONCERNING GOODYEAR'S PROPOSAL. THE RFP CONTEMPLATED A FIRM FIXED-PRICE
CONTRACT ALTHOUGH IT ADVISED OFFERORS THAT "OFFERS ON ANOTHER TYPE OF
CONTRACTUAL ARRANGEMENT WILL BE CONSIDERED RESPONSIVE." AS INDICATED
ABOVE, GOODYEAR PROPOSED ON A COST-PLUS-FIXED-FEE BASIS, AND REFUSED TO
OFFER A FIRM FIXED PRICE EVEN IN THE FACE OF THE ARMY'S ADVICE DURING
NEGOTIATIONS THAT "THE SOLICITATION REQUIRES A FIRM FIXED-PRICE
PROPOSAL." IT IS CLEAR FROM THE RECORD THAT THE ARMY NEVER REGARDED A
COST-PLUS-FIXED-FEE PROPOSAL ACCEPTABLE BECAUSE OF THE POSSIBILITY THAT
ACTUAL COSTS COULD EXCEED THOSE PROPOSED AND IN VIEW OF THE
IMPRACTICABILITY OF AUDITING SUCH A RELATIVELY LOW DOLLAR VALUE CONTRACT
WITH SUCH A SHORT DELIVERY SCHEDULE (100 DAYS). NEVERTHELESS, UNDER THE
"PRICE" EVALUATION CRITERION, GOODYEAR RECEIVED 75 POINTS (OUT OF A
MAXIMUM OF 100) AND GEORGETOWN RECEIVED 70. THE ARMY ADMITS THAT
"GOODYEAR RECEIVED A HIGHER RATING FOR ITS PROPOSED COST BECAUSE IT WAS
$10,000 LOWER THAN THE PROTESTER EVEN THOUGH GOODYEAR PROPOSED AN
UNACCEPTABLE TYPE OF CONTRACT." WE NEED NOT DWELL ON THE APPROPRIATENESS
OF THIS SCORING APPROACH, HOWEVER, SINCE GOODYEAR DID NOT RECEIVE THE
AWARD AND THEREFORE GEORGETOWN WAS NOT PREJUDICED BY THAT SCORING.
A MORE RELEVANT COMPARISON IS THE FIRM FIXED PRICES OFFERED BY ILC
DOVER ($86,075) AND THE PROTESTER ($96,600). ILC DOVER WAS AWARDED 95
POINTS FOR "PRICE" IN COMPARISON TO THE PROTESTER'S 70 POINTS. ALTHOUGH
THE PROTESTER ATTACKS ILC DOVER'S PRICE AS AN "ESTIMATE" BECAUSE ILC
DOVER WAS OFFERING A DEVELOPMENTAL ITEM RATHER THAN A
COMMERCIALLY-AVAILABLE ONE SUCH AS THE VETTER PRODUCT, THE FACT REMAINS
THAT ILC DOVER WAS OBLIGATED UNDER THE TERMS OF ITS PROPOSAL TO PERFORM
THE CONTRACT AT THE PRICE IT OFFERED. WE HAVE NO BASIS TO QUESTION THE
PROPRIETY OF THE ARMY'S EVALUATION OF ILC DOVER'S PRICE.
WITH REGARD TO THE SECOND ISSUE - THE PROPRIETY OF THE EVALUATION OF
TECHNICAL PROPOSALS - THERE ARE THREE CIRCUMSTANCES WHICH ESPECIALLY
CONCERN US AND WHICH MUST BE DISCUSSED AS A PRELIMINARY MATTER. FIRST,
THERE IS A DISPUTE BETWEEN GEORGETOWN AND THE ARMY AS TO WHAT WAS
SUBMITTED AS GEORGETOWN'S PROPOSAL. IN ITS REPORT TO OUR OFFICE, THE
ARMY STATES THAT GEORGETOWN'S "PROPOSAL" CONSISTED OF A COPY OF THE RFP
UPON WHICH WERE TYPED A FEW EXPLANATORY NOTES. GEORGETOWN DISPUTES
THIS, CLAIMING THAT ITS "OFFER IS NOT REPRODUCED IN ITS ENTIRETY IN THE
ARMY'S REPORT. PHOTOS AS WELL AS DRAWINGS WERE SUPPLIED WITH OUR OFFER
AS PART OF OUR OFFER." IT ALSO STATES THAT IT "SUPPLIED LITERATURE,
DRAWINGS, PHOTOS, MATERIAL COMPOSITION AND ACCOUNTING DATA ..." THE ARMY
JUST AS EMPHATICALLY MAINTAINS THAT NO SUCH MATERIAL WAS SUBMITTED WITH
GEORGETOWN'S PROPOSAL.
THE ONLY AVAILABLE EVIDENCE AS TO WHETHER GEORGETOWN'S PROPOSAL
INCLUDED DRAWINGS, PHOTOGRAPHS AND OTHER DATA IS THE CONFLICTING
STATEMENTS OF THE PROTESTER AND THE CONTRACTING AGENCY. IN SUCH
CIRCUMSTANCES, WE HAVE HELD THAT THE PROTESTER HAS NOT MET ITS BURDEN OF
AFFIRMATIVELY PROVING ITS CASE. HARRIS SYSTEMS OF TEXAS, INC.; ANTI
PEST CO., INC., B-208670, B-208809, APRIL 13, 1983, 83-1 CPD 392.
SECOND, THE RECORD DOES RAISE SOME QUESTION AS TO WHETHER THE ARMY'S
EVALUATOR MAY HAVE CONSULTED MATERIALS WHICH WERE NOT IN GEORGETOWN'S
TECHNICAL PROPOSAL. THIS WOULD HAVE BEEN IMPROPER, FOR IT IS A BASIC
PRINCIPLE OF NEGOTIATED PROCUREMENTS THAT PROPOSALS MUST BE EVALUATED
SOLELY ON THE BASIS OF INFORMATION FURNISHED WITH THEM. NO MATTER HOW
CAPABLE AN OFFEROR MAY BE, IT CANNOT EXPECT TO BE CONSIDERED FOR AWARD
IF IT DOES NOT SUBMIT AN ADEQUATELY WRITTEN PROPOSAL. AQUA-TECH, INC.,
B-210593, JULY 14, 1983, 83-2 CPD 91.
IN ITS INITIAL REPORT TO OUR OFFICE, THE ARMY STATED THAT AS A RESULT
OF GEORGETOWN'S "FAILURE TO PROVIDE A TECHNICAL PROPOSAL PER SE, THE
PROJECT ENGINEER EVALUATED THE PROPOSAL ON THE BASIS OF PREVIOUSLY
SUBMITTED ADVERTISING MATERIAL AND TELEPHONE CONVERSATIONS WITH THE
COMPANY ..." IN ITS SUPPLEMENTAL REPORT, HOWEVER, THE ARMY STATES THAT
"THE PROJECT ENGINEER WHO EVALUATED THE PROPOSALS RELIED ONLY ON
INFORMATION PROVIDED IN THE SOLICITATION AND NOT ON PHOTOGRAPHS,
DRAWINGS OR PROMOTIONAL LITERATURE PRESENTED OUTSIDE THE SOLICITATION/
AWARD PROCESS." WE ARE UNABLE TO RECONCILE THESE TWO STATEMENTS BY THE
ARMY.
THESE STATEMENTS CONCERN US BECAUSE SEVEN OF THE CATEGORIES UPON
WHICH PROPOSALS WERE GRADED (TIME REQUIRED FOR LIFT; MANPOWER REQUIRED
FOR LIFT; OVERLOAD LIFT CAPACITY; SAFETY EVALUATION; SERVICE AND
COMPATIBILITY IN MARINE ENVIRONMENT; SUITABILITY FOR TEMPERATURES FROM
-40 DEGS. F. TO 115 DEGS. F.; AND EXPERIENCE IN RELATED FIELDS) ARE NOT
SPECIFICALLY DISCUSSED IN THE NOTES ADDED BY GEORGETOWN TO THE RFP OR IN
THE QUESTIONS ASKED OF IT DURING NEGOTIATIONS. IT IS NOT CLEAR TO US
WHAT INFORMATION FORMED THE BASIS FOR GEORGETOWN'S SCORES IN THESE
AREAS, RANGING FROM 85 TO 100 PERCENT, SOME OF WHICH THE PROTESTER
CONSIDERS TOO LOW.
THE MOST STRIKING EXAMPLE, PERHAPS, IS THE FACT THAT GEORGETOWN
RECEIVED 90 POINTS OUT OF A MAXIMUM OF 100 IN THE CATEGORY "EXPERIENCE
IN RELATED FIELDS." GEORGETOWN ARGUES THAT ITS SCORE IS TOO LOW AND ITS
PROTEST INCLUDES AN EXTENSIVE LIST OF CONTRACTS IT HAS PERFORMED FOR THE
GOVERNMENT AS WELL AS AN ACCOUNT OF THE EXPERIENCE OF ITS PROJECT/
DESIGN ENGINEER. THE PROTESTER ADMITS THAT NONE OF THIS INFORMATION WAS
PROVIDED WITH ITS PROPOSAL BECAUSE IT WAS NOT "ASKED FOR." THIS, OF
COURSE, IS INCORRECT BECAUSE SECTION L.6(E) OF THE SOLICITATION, QUOTED
ABOVE, SPECIFICALLY ADVISED OFFERORS THAT THEIR PROPOSALS "SHALL INCLUDE
... TWO (2) COPIES OF YOUR QUALIFICATIONS TO PERFORM THE PROPOSED WORK
AND SERVICES (TO INCLUDE RESUMES FOR THE SCIENTIFIC/ TECHNICAL PERSONNEL
PROPOSED FOR THE PROGRAM)," WHILE SECTION M.3 OF THE SOLICITATION,
IDENTIFYING THE CRITERIA BY WHICH PROPOSALS WOULD BE EVALUATED, INCLUDED
THE FOLLOWING CRITERION:
"(5) EXPERIENCE IN SIMILAR OR RELATED
FIELDS. IDENTIFY ANY CURRENT OR RECENTLY
COMPLETED GOVERNMENT CONTRACTS IN A SIMILAR FIELD."
SINCE GEORGETOWN ADMITTEDLY DID NOT SUBMIT ANY OF THIS INFORMATION WITH
ITS PROPOSAL, WE FAIL TO UNDERSTAND HOW IT COULD HAVE RECEIVED 90
PERCENT CREDIT FOR EVALUATION CRITERION NUMBER 5.
THIRD, IT IS CLEAR FROM GEORGETOWN'S ANSWERS TO THE QUESTIONS ASKED
OF IT DURING DISCUSSIONS AND FROM ITS PROTEST CORRESPONDENCE THAT THE
COMPANY ANTICIPATED THAT ITS PROPOSAL WOULD BE EVALUATED IN LIGHT OF THE
INFORMATION ABOUT THE VETTER SYSTEM IT HAD PROVIDED TO THE ARMY DURING
THE 3 YEARS PRECEDING THIS SOLICITATION. ONE EXAMPLE OF THIS
EXPECTATION ON GEORGETOWN'S PART IS ITS PROPOSED MANIFOLD SYSTEM.
THE MANIFOLD IS A DEVICE WHICH RECEIVES AIR FROM A COMPRESSOR OR
STORAGE CYLINDER AND DISTRIBUTES IT TO THE AIR BAGS. THROUGH A SYSTEM
OF VALVES AND GAUGES AN OPERATOR CAN MONITOR AND CONTROL THE AMOUNT OF
PRESSURE IN EACH AIR BAG. THE RFP SPECIFICATIONS DID NOT PRESCRIBE ANY
PARTICULAR DESIGN OF THE MANIFOLD OTHER THAN "THE PRESSURE IN EACH AIR
BAG CAN BE READ BY A SINGLE OPERATOR AT THE COMPRESSED AIR SOURCE." UPON
THE COPY OF THE RFP WHICH IT SUBMITTED AS ITS PROPOSAL, GEORGETOWN TYPED
A NOTE IN WHICH IT "RECOMMENDED" THAT THE MANIFOLD SYSTEM BE DESIGNED SO
THAT HALF THE LIFT BAG SYSTEM BE CONTROLLED FROM THE FRONT OR SIDE OF
THE CRAFT AND HALF FROM THE OPPOSITE SIDE OF THE CRAFT, WHICH WOULD
REQUIRE TWO OPERATORS. OTHER THAN THIS NOTATION, THERE IS NO
DESCRIPTION OF THE MANIFOLD SYSTEM IN THE RFP SUBMITTED BY GEORGETOWN.
IN ITS REQUEST FOR BEST AND FINAL OFFERS, THE ARMY ADVISED GEORGETOWN
THAT ITS "PROPOSED MANIFOLD SYSTEM SHOULD BE ADDRESSED IN DETAIL."
GEORGETOWN'S RESPONSE, IN ITS ENTIRETY, WAS:
"MANIFOLDING TO BE AT YOUR OPTION. WE HAVE
GIVEN YOU DETAILS OVER THREE YEARS. DRAWINGS
WILL BE SUPPLIED FOR APPROVAL IF AWARDED A CONTRACT."
ONE OF THE ARMY'S CRITICISMS OF GEORGETOWN'S PROPOSAL WAS THAT THE
COMPANY FAILED TO DESCRIBE THE DESIGN OF THE MANIFOLD IT PROPOSED TO
SUPPLY. ON THE BASIS OF THIS RECORD, WE CANNOT SAY THAT THE ARMY'S
CRITICISM IS UNREASONABLE. WE DO NOT UNDERSTAND GEORGETOWN EVEN TO
CONTEND THAT IT SUBMITTED WITH ITS PROPOSAL A DETAILED DESCRIPTION OF
ITS PROPOSED MANIFOLD; BUT RATHER, THAT PRIOR TO THE ISSUANCE OF THIS
RFP IT HAD SHOWN ARMY ENGINEERS PHOTOGRAPHS OF ITS PROPOSED MANIFOLD AND
THAT IT PROMISED TO SUPPLY DRAWINGS OF IT "FOR APPROVAL" AFTER THE
CONTRACT WAS AWARDED. THIS WAS NOT RESPONSIVE TO THE ARMY'S REQUEST
THAT GEORGETOWN ADDRESS "IN DETAIL" ITS PROPOSED MANIFOLD SYSTEM.
SIMILARLY, THE CONTRACTOR WAS TO PROVIDE A SAFETY ASSESSMENT REPORT
AND A TEST AND DEMONSTRATION REPORT. IN ITS PROPOSAL, ILC DOVER
EXPLAINED HOW IT WOULD DO THESE TASKS. GEORGETOWN APPENDED TO THESE
ITEMS IN THE RFP SCHEDULE A NOTE WHICH STATED, "TO COMPLY WITH THESE
REQUIREMENTS WE WILL FURNISH A CERTIFICATE OF TEST AND THE TESTING
CRITERIA FROM A GERMAN TEST LAB." WHEN QUERIED ABOUT THIS ASPECT OF ITS
PROPOSAL IN THE ARMY'S REQUEST FOR BEST AND FINAL OFFERS, GEORGETOWN
REPLIED:
"WE WILL SUPPLY A CERTIFICATE OF TEST BY A
GERMAN TEST LAB AS SPECIFIED IN OUR PROPOSAL
AND THOROUGHLY DISCUSSED WITH ALL YOUR
PEOPLE BEFORE WE SENT OUR PROPOSAL."
GEORGETOWN'S EXPECTATION THAT IT WOULD BE EVALUATED FOR AWARD BASED
ON INFORMATION OUTSIDE ITS PROPOSAL RUNS COUNTER TO THE EXPLICIT
INSTRUCTIONS IN SECTIONS L.6 AND M.3 OF THE SOLICITATION AS WELL AS
DECISIONS OF OUR OFFICE IN WHICH WE REPEATEDLY HAVE HELD THAT ALL
OFFERORS MUST DEMONSTRATE IN THEIR PROPOSALS COMPLIANCE WITH THE
REQUIREMENTS SET OUT IN THE SOLICITATION SO THAT EACH FIRM CAN BE
EVALUATED ON A COMMON BASIS UNDER THE SCHEME ESTABLISHED FOR SELECTING
THE SUCCESSFUL COMPETITOR. SEE, E.G., THE MANAGEMENT AND TECHNICAL
SERVICES COMPANY, A SUBSIDIARY OF GENERAL ELECTRIC COMPANY, B-209513,
DECEMBER 23, 1982, 82-2 CPD 571, AND CASES CITED THEREIN.
WITH RESPECT TO THE PROPRIETY OF THE EVALUATION OF TECHNICAL
PROPOSALS, WE OFTEN HAVE STATED THAT IT IS NEITHER OUR FUNCTION NOR OUR
PRACTICE TO DETERMINE INDEPENDENTLY THE ACCEPTABILITY OR RELATIVE
TECHNICAL MERIT OF PROPOSALS. OUR REVIEW OF AN AGENCY'S EVALUATION OF
PROPOSALS IS LIMITED TO EXAMINING WHETHER THE EVALUATION WAS FAIR AND
REASONABLE AND CONSISTENT WITH THE EVALUATION CRITERIA. WE WILL
QUESTION A CONTRACTING OFFICIAL'S ASSESSMENT OF THE TECHNICAL MERITS OF
PROPOSALS ONLY UPON A CLEAR SHOWING OF UNREASONABLENESS, ABUSE OF
DISCRETION OR VIOLATION OF PROCUREMENT STATUTES OR REGULATIONS. MARINE
RESEARCH, INC., B-206271, OCTOBER 29, 1982, 82-2 CPD 380.
OUR REVIEW IS MADE MORE DIFFICULT BY THE THREE CIRCUMSTANCES WE HAVE
DESCRIBED ABOVE: THE DISPUTE AS TO WHAT WAS SUBMITTED AS GEORGETOWN'S
PROPOSAL; THE POSSIBLE USE BY THE ARMY'S EVALUATOR OF SOME INFORMATION
NOT CONTAINED IN THAT PROPOSAL; AND GEORGETOWN'S EXPECTATION THAT IT
WOULD BE EVALUATED NOT ONLY ON THE BASIS OF ITS RESPONSE TO THIS
SOLICITATION BUT ITS EFFORT OVER THE PRECEDING 3 YEARS.
AS WE STATED ABOVE, IN VIEW OF GEORGETOWN'S FAILURE TO MEET ITS
BURDEN OF PROOF ON THE ISSUE, WE MUST CONCLUDE THAT ITS "PROPOSAL"
CONSISTED SOLELY OF A COPY OF THE RFP UPON WHICH SEVERAL NOTATIONS WERE
TYPED AND ITS ANSWERS TO THE QUESTIONS ASKED OF IT BY THE ARMY DURING
NEGOTIATIONS. THE INFORMATION GEORGETOWN SUPPLIED IN THESE MATERIALS
FALLS SO FAR SHORT OF WHAT WAS REQUIRED BY SECTIONS L.6 AND M. OF THE
SOLICITATION THAT WE MUST FURTHER CONCLUDE THAT IN MANY RESPECTS
GEORGETOWN APPEARS TO HAVE BEEN GIVEN THE BENEFIT OF THE DOUBT IN THE
EVALUATION PROCESS, AS SUGGESTED BY THE FACT THAT IT RECEIVED 90 PERCENT
CREDIT UNDER "EXPERIENCE IN RELATED FIELDS" WHEN IT ADMITTEDLY SUBMITTED
NO INFORMATION ON THIS SUBJECT WITH ITS PROPOSAL.
WE NOW TURN TO GEORGETOWN'S SPECIFIC OBJECTIONS TO THE EVALUATION OF
TECHNICAL PROPOSALS. IT FIRST ARGUES THAT IT SHOULD HAVE RECEIVED A
HIGHER SCORE THAN ILC DOVER UNDER THE FACTOR "TIME REQUIRED TO EFFECT
LIFT," WEIGHTED AT 5 PERCENT. IN THEIR RECOMMENDATION TO THE
CONTRACTING OFFICER THAT AWARD BE MADE TO ILC DOVER, THE ARMY'S
ENGINEERS PROVIDED THE FOLLOWING INFORMATION CONCERNING THE "TIME
REQUIRED FOR LIFT" AT 250 CUBIC FEET OF AIR PER MINUTE:
OFFEROR TIME SCORE
GOODYEAR 4.7 MINUTES 80
ILC DOVER 5.1 MINUTES 90
GEORGETOWN 3.6 MINUTES 85
GEORGETOWN ARGUES THAT SINCE ITS TIME IS THE SHORTEST, IT SHOULD HAVE
RECEIVED THE HIGHEST SCORE. IN RESPONSE, THE ARMY STATES THAT IN
SCORING THE PROPOSALS UNDER "TIME REQUIRED TO EFFECT LIFT" IT TOOK INTO
CONSIDERATION NOT ONLY THE TIMES SHOWN ABOVE, WHICH REPRESENT INFLATION
TIME, BUT THE TIME REQUIRED TO POSITION THE AIR BAGS. SINCE THE BAGS
PROPOSED BY GEORGETOWN ARE HEAVIER THAN ILC DOVER'S, THE EVALUATOR
REASONED IT WOULD TAKE LONGER TO POSITION THEM AND, TAKING INTO ACCOUNT
BOTH POSITIONING AND INFLATION TIME, THAT ILC DOVER MERITED A SLIGHTLY
HIGHER SCORE. (THIS RATIONALE ALSO WOULD BE CONSISTENT WITH THE LOWEST
SCORE BEING GIVEN TO GOODYEAR EVEN THOUGH IT DID NOT HAVE THE LONGEST
INFLATION TIME, BECAUSE ITS BAGS WERE THE HEAVIEST PROPOSED BY ANY
OFFEROR AND PRESUMABLY WOULD TAKE THE LONGEST TO POSITION.)
WITH REGARD TO THE CRITERION "MANPOWER REQUIRED FOR LIFT" (WEIGHT: 5
PERCENT), THE ENGINEERS' SUMMARY AND THE EVALUATOR'S SCORING WAS:
PERSONNEL
OFFEROR REQUIRED SCORE
GOODYEAR 3 90
ILC DOVER 2 100
GEORGETOWN 3 90
GEORGETOWN QUESTIONS WHY ILC DOVER RECEIVED THE MAXIMUM SCORE WHEN IN
ITS TECHNICAL PROPOSAL IT STATED "... THE AIR BAGS CAN BE PROPERLY
POSITIONED UNDER THE CRAFT BY 2 OR MORE PEOPLE." THE PROTESTER MAINTAINS
THAT THE IMPLICATION OF THIS STATEMENT IS THAT MORE THAN TWO PEOPLE MAY
BE REQUIRED TO POSITION THE ILC DOVER BAGS AND, IN THAT EVENT, ILC DOVER
SHOULD NOT HAVE RECEIVED MORE CREDIT THAN GEORGETOWN. THE ARMY ADVISES
THAT ITS EVALUATOR REASONED THAT SINCE ILC DOVER'S BAGS WERE LIGHTER
THAN THE OTHER OFFERORS', IT WOULD BE POSSIBLE TO POSITION ITS BAGS WITH
FEWER PEOPLE.
GEORGETOWN NEXT OBJECTS TO THE RATING IT RECEIVED UNDER "GENERAL
QUALITY AND RESPONSIVENESS OF PROPOSAL" (WEIGHTED AT 3 PERCENT) FOR
WHICH THE PROTESTER RECEIVED THE LOWEST SCORE (80) OF THE THREE
OFFERORS. AS SECTION M.3(D) OF THE RFP INDICATED, CONSIDERED UNDER THIS
CRITERION WERE: (1) COMPLETENESS AND THOROUGHNESS; (2) CLARITY, AND
(3) RESPONSIVENESS TO TERMS. GEORGETOWN ESSENTIALLY CLAIMS THAT IT
OFFERED TO SATISFY ALL OF THE ARMY'S REQUIREMENTS; THE ARMY MAINTAINS
THAT THE LOW SCORE IS ATTRIBUTABLE TO GEORGETOWN'S SKETCHY PROPOSAL.
GEORGETOWN ALSO DISAGREES WITH THE 90 PERCENT CREDIT IT RECEIVED FOR
"EXPERIENCE IN RELATED FIELDS" AND HAS SUPPLIED EXTENSIVE INFORMATION ON
THIS SUBJECT WITH ITS PROTEST. THE ARMY NOTES THAT NONE OF THIS
INFORMATION WAS INCLUDED WITH GEORGETOWN'S PROPOSAL.
WE CANNOT SAY THAT THE ARMY'S EVALUATION OF GEORGETOWN'S PROPOSAL WAS
UNREASONABLE AS TO ANY OF THESE CRITERIA. IT IS UNDISPUTED THAT ILC
DOVER'S PROPOSED BAG SYSTEM HAD THE LOWEST WEIGHT. AS WAS POINTED OUT
IN SECTION M.3 OF THE RFP, THIS NOT ONLY WAS AN ADVANTAGE IN ITSELF
("SYSTEM WEIGHT: LOWER WEIGHTS SHALL BE GIVEN HIGHER RATINGS") BUT ALSO
WAS IN THE OFFEROR'S FAVOR TO THE EXTENT IT REDUCED THE NUMBER OF PEOPLE
REQUIRED TO POSITION THE BAG ("MANPOWER REQUIRED TO EFFECT LIFT:
SYSTEMS REQUIRING LESS MANPOWER SHALL BE GIVEN PREFERENCE") AND TO THE
EXTENT IT REDUCED THE TIME REQUIRED TO EFFECT LIFT ("SYSTEMS REQUIRING
LESS TIME SHALL RECEIVE HIGHER RATINGS"). WITH REGARD TO THE NUMBER OF
PEOPLE REQUIRED TO EFFECT LIFT, GEORGETOWN DOES NOT DISPUTE THE ARMY'S
ASSESSMENT THAT GEORGETOWN'S SYSTEM REQUIRES THREE PEOPLE. ALTHOUGH, AS
GEORGETOWN POINTS OUT, ILC DOVER'S PROPOSAL STATES THAT ITS SYSTEM CAN
BE POSITIONED BY "2 OR MORE PEOPLE," WE NOTE THAT TWO PERSONS IS
REPRESENTED AS THE MINIMUM NUMBER NEEDED TO POSITION THE BAG SYSTEM AND
GEORGETOWN HAS NOT SHOWN THIS FIGURE OR THE ARMY'S ACCEPTANCE OF IT TO
HAVE BEEN UNREASONABLE. FINALLY, IN VIEW OF THE BREVITY OF GEORGETOWN'S
PROPOSAL, WE HAVE NO BASIS UPON WHICH TO CONCLUDE THAT THE FIRM SHOULD
HAVE RECEIVED HIGHER RATINGS UNDER "GENERAL QUALITY AND RESPONSIVENESS
OF PROPOSAL" AND "EXPERIENCE IN RELATED FIELDS."
GEORGETOWN ALSO HAS TAKEN EXCEPTION TO SOME OF THE REMARKS MADE BY
THE ARMY'S TECHNICAL EVALUATOR IN A MEMORANDUM WHICH HE WROTE IN
RESPONSE TO THE PROTEST AND IN WHICH HE DISCUSSED SOME OF THE CONCERNS
WHICH LED HIM TO RECOMMEND AWARD TO ILC DOVER. THE ENGINEER PERCEIVED
GEORGETOWN AS A SMALL BUSINESS CONCERN WITH NO FORMAL ENGINEERING
BACKGROUND OR CAPABILITIES AND WHICH MUST OBTAIN ITS ENGINEERING SUPPORT
FROM THE AIR BAG MANUFACTURER IN GERMANY; HE QUESTIONED WHETHER
GEORGETOWN COULD SUPPLY THE REQUIRED "TECHNICAL DATA SOFTWARE" (A PARTS
LIST AND A TECHNICAL MANUAL CONTAINING OPERATING AND MAINTENANCE
PROCEDURES); AND HE LISTED AS A CONCERN "BUY AMERICAN ACT (PROBLEMS
WITH CUSTOMS, INTERCHANGEABILITY OF PARTS, ETC.)."
THE PROTESTER OBJECTS TO THESE STATEMENTS ON THE BASIS THAT ITS
ENGINEERING CAPABILITIES, BOTH IN-HOUSE AND THOSE AVAILABLE TO IT
THROUGH CONSULTANTS, ARE MORE THAN ADEQUATE, AS SHOWN BY THE PROGRESS IT
MADE DURING THE PRECEDING 3 YEARS IN DEVISING A SOLUTION TO THE ARMY'S
NEED FOR AN AIR BAG SYSTEM FOR THE LACV-30; THAT IT NEED NOT MAINTAIN
AN IN-HOUSE TECHNICAL WRITING GROUP AS DOES ILC DOVER, BECAUSE THERE ARE
AVAILABLE SUBCONTRACTORS WHO SPECIALIZE IN PREPARING TECHNICAL
DOCUMENTS; AND THAT NONE OF THE ENGINEER'S CONCERNS RELATING TO THE
"BUY AMERICAN ACT" IS RELEVANT TO THIS PROCUREMENT.
WE THINK THAT TO THE EXTENT, IF ANY, THE ARMY'S EVALUATOR MAY HAVE
UNDERESTIMATED GEORGETOWN'S ENGINEERING EXPERTISE OR ITS ABILITY TO
PROVIDE ADEQUATE DOCUMENTATION, IT IS ATTRIBUTABLE TO GEORGETOWN'S
FAILURE TO DISCUSS THESE SUBJECTS IN ITS PROPOSAL. THE ARMY CONCEDES
THAT THE BUY AMERICAN ACT WAS NOT A RELEVANT CONSIDERATION IN THIS
PROCUREMENT. IT IS NOT CLEAR PRECISELY WHAT "CUSTOMS PROBLEMS" THE
EVALUATOR HAD IN MIND AND WE AGREE WITH GEORGETOWN THAT
"INTERCHANGEABILITY OF PARTS" WAS NOT LISTED IN THE RFP AS AN EVALUATION
CRITERION. WE CANNOT TELL FROM THE RECORD HOW MANY POINTS, IF ANY, WERE
DEDUCTED FROM GEORGETOWN'S SCORE FOR THESE REASONS, BUT WE HAVE NO
REASON TO BELIEVE THAT WERE THEY TO BE RESTORED IT WOULD BE ENOUGH TO
OFFSET THE TECHNICAL ADVANTAGE AND $10,000 PRICE DIFFERENTIAL OTHERWISE
ENJOYED BY ILC DOVER.
GEORGETOWN'S FINAL ARGUMENT IS THAT ILC DOVER IS NOT CAPABLE OF
MEETING THE SOLICITATION'S REQUIREMENTS WITHIN THE REQUIRED DELIVERY
SCHEDULE OF 100 DAYS. IN EFFECT, THE PROTESTER IS CHALLENGING THE
CONTRACTING OFFICER'S DETERMINATION - IMPLICIT IN HIS AWARD OF A
CONTRACT TO ILC DOVER - THAT THE FIRM IS A RESPONSIBLE CONTRACTOR.
BECAUSE AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY IS LARGELY A
SUBJECTIVE BUSINESS JUDGMENT, OUR OFFICE DOES NOT REVIEW THE
DETERMINATION ABSENT A SHOWING OF POSSIBLE FRAUD ON THE PART OF
PROCURING OFFICIALS OR THAT DEFINITIVE RESPONSIBILITY CRITERIA CONTAINED
IN THE SOLICITATION WERE NOT APPLIED. 4 C.F.R. SEC. 21.3(G)( 4), AS
ADDED BY 48 FED.REG. 1932 (1983); MOORE SERVICE, INC., B-213302,
OCTOBER 31, 1983, 83-2 CPD 523. ALTHOUGH GEORGETOWN ALLEGES THAT THE
ARMY EVALUATOR'S NEGATIVE COMMENTS ABOUT IT AND ITS PROJECT/ DESIGN
ENGINEER EVIDENCE "BIAS" AGAINST IT, WE THINK THOSE COMMENTS MORE LIKELY
REFLECT THE FACT THAT GEORGETOWN FAILED TO SUBMIT WITH ITS PROPOSAL ANY
ACCOUNT OF ITS EXPERIENCE OR EMPLOYEES' QUALIFICATIONS, CONTRARY TO THE
INSTRUCTIONS IN THE SOLICITATION. WE DO NOT BELIEVE THERE HAS BEEN A
SUFFICIENT SHOWING OF POSSIBLE FRAUD - WHICH WE HAVE DEFINED AS
VIRTUALLY IRREFUTABLE PROOF OF A MALICIOUS AND SPECIFIC INTENT TO HARM
THE PROTESTER - TO INVOKE THE EXCEPTION TO OUR POLICY OF NOT REVIEWING
AFFIRMATIVE DETERMINATIONS OF RESPONSIBILITY, AND SINCE THERE ARE NO
DEFINITIVE CRITERIA INVOLVED HERE, WE DISMISS THE PROTEST AS IT RELATES
TO ILC DOVER'S RESPONSIBILITY.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
FN1 GOODYEAR'S ESTIMATED COST PLUS A FIXED FEE; THE OTHER OFFERS
WERE BASED ON A FIRM FIXED PRICE.
B-210805, JUN 24, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHILE GAO WILL REVIEW THE AWARD OF A CONTRACT UNDER A GRANT, GAO WILL
NOT CONSIDER A COMPLAINT THAT THE GRANTEE FAILED TO PERMIT THE PRIME
CONTRACTOR TO SUBSTITUTE THE COMPLAINANT'S PRODUCT FOR ONE OF THE
PRODUCTS SPECIFIED IN THE CONTRACT, SINCE THE MATTER IS ONE OF CONTRACT
ADMINISTRATION.
TAMMERMATIC CORPORATION:
TAMMERMATIC CORPORATION HAS SUBMITTED A COMPLAINT CONCERNING THE
AWARD OF A CONTRACT BY THE TRI-COUNTY METROPOLITAN TRANSPORTATION
DISTRICT OF OREGON (TRI-MET) TO CONTRACTORS, INC. FOR THE CONSTRUCTION
OF A NEW VEHICLE MAINTENANCE FACILITY, INCLUDING THE INSTALLATION OF A
VEHICLE WASH SYSTEM. THE CONTRACT IS FUNDED IN LARGE PART (80 PERCENT)
BY A GRANT FROM THE URBAN MASS TRANSPORTATION ADMINISTRATION.
TAMMERMATIC, A MANUFACTURER OF VEHICLE WASH SYSTEMS, COMPLAINS THAT
TRI-MET FAILED TO PERMIT CONTRACTORS TO SUBSTITUTE TAMMERMATIC'S PRODUCT
FOR THE VEHICLE WASH SYSTEM NAMED IN THE CONTRACT. WE DISMISS THE
COMPLAINT.
TRI-MET ISSUED THE SOLICITATION ON JANUARY 21, 1982, SPECIFYING TWO
MANUFACTURERS OF VEHICLE WASH SYSTEMS AS ACCEPTABLE SUBCONTRACTORS.
CERTAIN PROVISIONS OF THE SOLICITATION ALLOWED THAT SUBSTITUTION
REQUESTS FOR ALTERNATIVE WASH SYSTEMS COULD BE MADE BY THE PRIME
CONTRACTOR, WHICH WERE TO BE APPROVED OR DISAPPROVED BY TRI-MET'S
ARCHITECTURAL CONSULTANT IN HIS DISCRETION. AWARD WAS MADE TO
CONTRACTORS ON FEBRUARY 19. THAT FIRM FILED SUBSTITUTION REQUESTS FOR
THE TAMMERMATIC WASH SYSTEM ON AUGUST 4 AND SEPTEMBER 29. BOTH REQUESTS
WERE REJECTED BY TRI-MET'S ARCHITECT BECAUSE THE REQUESTS DID NOT SHOW,
IN ACCORDANCE WITH THE PRESCRIBED SUBSTITUTION PROCEDURES, THAT THE
TAMMERMATIC SYSTEM SUBSTITUTION WAS NECESSARY TO PERFORM THE CONTRACT OR
WOULD BE OF SUBSTANTIAL BENEFIT TO THE CONTRACT IN TERMS OF COST, TIME
OR OTHER CONSIDERATIONS. TAMMERMATIC COMPLAINS THAT THE DISAPPROVALS
WERE IMPROPER, THEREBY EXCLUDING IT FROM PARTICIPATION IN THE CONTRACT.
OUR REVIEW IN GRANT SITUATIONS IS TO INSURE THAT GRANTOR AGENCIES ARE
REQUIRING THEIR GRANTEES, IN AWARDING CONTRACTS, TO COMPLY WITH
APPLICABLE LAWS, REGULATIONS, OR THE TERMS OF THE GRANT AGREEMENTS. SEE
COPELAND SYSTEMS, INC., 55 COMP.GEN. 390 (1975), 75-2 CPD 237. OUR
REVIEW IS LIMITED TO AN EXAMINATION OF AWARDS MADE BY THE GRANTEE TO THE
PRIME CONTRACTOR (FOR EXAMPLE, TRI-MET'S AWARD TO CONTRACTORS) OR, IN
CERTAIN CIRCUMSTANCES NOT PRESENT HERE, THE CONTRACTOR'S AWARD OF A
SUBCONTRACT. SEE HYDRO-CLEAR CORPORATION, B-189486, FEBRUARY 7, 1978,
78-1 CPD 103. A PRIME CONCERN OF OUR REVIEW IS TO INSURE THAT FREE AND
OPEN COMPETITION IS ACHIEVED. SEE INTERNATIONAL BUSINESS MACHINES
CORP., B-194365, JULY 7, 1980, 80-2 CPD 12.
IN THE MATTER BEFORE US, THERE IS NO ALLEGATION THAT TRI-MET'S AWARD
TO CONTRACTORS WAS INCONSISTENT WITH THE FUNDAMENTAL PRINCIPLES OF
FEDERAL PROCUREMENT INHERENT IN THE CONCEPT OF COMPETITION. SEE WISMER
& BECKER CONTRACTING ENGINEERS, B-202075, JUNE 7, 1982, 82-1 CPD 538.
RATHER, THE ISSUE TAMMERMATIC RAISES INVOLVES THE ADMINISTRATION OF THE
CONTRACT AWARDED BY THE GRANTEE. WE DO NOT CONSIDER SUCH MATTERS AS
PART OF OUR GRANT REVIEW PROCESS (OR IN CONNECTION WITH DIRECT FEDERAL
PROCUREMENTS). CITY COUNCIL OF READING, PENNSYLVANIA, B-192921, OCTOBER
17, 1978, 78-2 CPD 283.
SINCE TRI-MET'S DISAPPROVAL OF THE SUBSTITUTION REQUESTS IS AN ISSUE
OF CONTRACT ADMINISTRATION, AND DOES NOT DIRECTLY CONCERN A CONTRACT
AWARD, THE COMPLAINT IS DISMISSED.
B-210803, MAR 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO DOES NOT REVIEW PROTESTS BY FEDERAL EMPLOYEES AGAINST AGENCY
DETERMINATION UNDER OFFICE OF MANAGEMENT AND BUDGET CIRCULAR NO. A-76 TO
CONTRACT FOR SERVICES RATHER THAN HAVE THEM PERFORMED IN-HOUSE.
JOSEPH FELIX:
MR. JOSEPH FELIX, ON BEHALF OF HIMSELF AND OTHER GENERAL SERVICES
ADMINISTRATION (GSA) MECHANICAL EMPLOYEES, PROTESTS GSA'S DECISION TO
CONTRACT OUT FOR MECHANICAL MAINTENANCE AT THE GREEN/BYRNE COMPLEX IN
PHILADELPHIA, PENNSYLVANIA, UNDER SOLICITATION NO. GS-03-82-B-0064.
OUR OFFICE DOES NOT REVIEW PROTESTS BY FEDERAL EMPLOYEES AGAINST
AGENCY DETERMINATIONS UNDER OFFICE OF MANAGEMENT AND BUDGET CIRCULAR NO.
A-76 TO CONTRACT FOR SERVICES RATHER THAN HAVE THEM PERFORMED IN-HOUSE.
SEE TAXPAYERS GENERALLY AND FEDERAL EMPLOYEES OF FORT EUSTIS, VIRGINIA,
B-210188, JANUARY 17, 1983, 83-1 CPD 52.
THE PROTEST IS DISMISSED.
B-210801.2, Nov 6, 1984, 84-2 CPD 503
CONTRACTS - Negotiation - Requests for proposals - Amendment -
Statutory change
DIGEST:
1. Despite lengthy procurement delays, agency acted properly in
amending RFP procuring speciality metal item to recognize exception to
DOD restriction against use of foreign specialty metals where end
products of qualifying countries are offered. Law had been amended to
recognize this exception after RFP issuance, but RFP did not recognize
this exception until amendment was issued.
CONTRACTS - Protests - Allegations - Speculative
2. Although failure to promptly notify offeror of awards on other
line items under RFP, where offeror was in line for award on another
line item, violated Defense Acquisition Regulation Sec. 3-508, such
procedural deficiency does not provide basis for disturbing otherwise
valid award since alleged prejudice is speculative.
Grieshaber Mfg. Company, Inc.:
Grieshaber Mfg. Company, Inc. (Grieshaber), has protested the
issuance of amendment 0004 to request for proposals (RFP)
DLA120-82-R-2227, issued by the Defense Personnel Support Center (DPSC),
Defense Logistics Agency (DLA), Philadelphia, Pennsylvania, for various
forceps. Grieshaber states that it was in line for award of line item
0006 of this RFP long prior to the issuance of this amendment, but DPSC
told it that a lawsuit precluded an award. In this regard, the RFP was
issued over 2 years ago and proposals were received in November 1982.
Grieshaber claims that the issuance of this amendment is "equivalent to
(an improper) cancellation and resolicitation of the procurement.
Grieshaber also claims that because of its small business/labor surplus
area status, this effective cancellation violates the policy favoring
awards to small business and labor surplus area concerns. Grieshaber
also claims that it was not notified of awards of certain other line
items made long ago under this RFP. Grieshaber claims this lack of
notification violated pertinent procurement regulations, prejudiced its
interests, and demonstrates that award of line item 0006 should have
been made to it prior to the issuance of amendment 0004.
We deny the protest.
The RFP was issued on August 9, 1982, as a 100-percent labor surplus
set-aside for various line items of forceps. The RFP contained a
clause-- I-42 "Preference for Domestic Specialty Metals" (DLA 1982
Jan)-- which effectively excluded items made from specialty metals not
"melted" (the first production stage of the metals) in the United
States. The forceps being procured under the RFP are made of specialty
metals. The restriction on use of foreign specialty metals stems from a
provision which has been enacted in various forms since 1972 in
Department of Defense appropriation acts. See Department of Defense
Appropriation Act, Pub. Law 92-570, Sec. 724, 86 Stat. 1184 (Oct. 26,
1972).
Amendment 0001 to the RFP was issued August 27, 1982, adding certain
line items to the RFP. By amendment 0002 dated October 7, 1982, the RFP
changed clause "I-42" to the specialty metals clause contained in
Defense Acquisition Regulation (DAR) Sec. 7-104.93(b), reprinted in 32
C.F.R. pts. 1-39 (1983). The DAR clause exempts "qualifying country end
products" from the foreign specialty metal exclusion. Amendment 0002
was occasioned by the Department of Defense Authorization Act of 1983,
Pub. Law 97-252, Sec. 1129, 96 Stat. 759 (Sept. 8, 1982), which made the
"qualifying country" exception to the specialty metals exclusion.
However, this exception to the specialty metals exclusion was
subsequently revoked in a Joint Resolution, Pub. Law 97-276, Sec.
101(a)(4), 96 Stat. 1188 (Oct. 2, 1982). Consequently, DPSC issued
amendment 0003 to November 10,1982, once again incorporating the "DLA
1982" version of clause "I-42" in the RFP. This amendment also extended
the closing date for receipt of proposals to November 30, 1982, by which
time a number of proposals were submitted.
DLA did not promptly make and award under the RFP. DLA attributes
the delay in making this award to certain protests first filed at this
Office in June 1982 by Columbia Surgical Manufacturing Corporation
(Columbia) and A&P Surgical Company Inc. (A&P), against multiple DPSC
solicitations. These protests concerned the DLA interpretation of the
specialty metal restrictions as to whether it required only the metal to
be melted in the United States or whether the specialty metal item had
to be completely manufactured in the United States. DLA believed the
former definition was correct. On February 14, 1983, any award under
this RFP was specifically protested. These protests were resolved in
favor of DLA's interpretation in A&P Surgical Company Inc.; Columbia
Surgical Instruments co., Inc., 62 Comp.Gen. 256 (1983), 83-1 C.P.D.
Para. 263, and Columbia Surgical Manufacturing Corporation, B-209983,
Mar. 28, 1983, 83-1 C.P.D. Para. 316. However, on April 11, 1983,
Columbia and A&P filed a lawsuit on the same basis in the United States
District Court for the Eastern District of Pennsylvania against DLA
solicitations involving specialty metals. The United States agreed at
that time not to proceed with any awards on specialty metal
solicitations pending a decision in the lawsuit. The lawsuit was
finally resolved in a stipulation for voluntary dismissal on March 5,
1984.
Other line items were awarded under this RFP to another offeror on
March 22, 1983, during the period following resolution of bid protests
by this Office and the institution of the lawsuit. DPSC admits that it
inadvertently failed top give notice to Grieshaber of the award of these
items. DPSC states that no award could be made to Grieshaber during
this period because the Food and Drug Administration (FDA) did not
finally approve Grieshaber as a source until April 11, 1983, when the
awards were suspended by the lawsuit.
The "qualifying country exception" to the specialty metals
restriction was reinstated by the Supplemental Appropriations Act of
1983, Pub. Law 98-63, chap. 3, 97 Stat. 309 (July 30, 1983), and the
1984 Department of Defense Appropriation Act, Pub. Law 98-212, Sec.
721A. 97 Stat. 1442 (Dec. 8, 1983). Consequently, DPSC issued amendment
0004 to the RFP on April 11, 1984, once again substituting the DAR Sec.
7-104.93(b), supra, "I-42" specialty metals clause in place of the "DLA
1982" specialty metals clause. This amendment also redefined the
delivery dates in view of the considerable delays in this procurement
and extended the date for receipt of revised proposals to April 25,
1984.
Inasmuch as the Pub. Law 98-112 treatment of specialty metals
recognizes the "qualifying country" exception and is the current
restriction on Department of Defense procurements of specialty metal
items, we believe DPSC issuance of amendment 0004 to the RFP was
entirely appropriate. It also was in accordance with applicable
instructions of DLA and the DAR council which required awards of
specialty metal items to be in accordance with currently applicable law.
See DAR case 83-40, "Specialty Metals and Chemical Protective
Clothing." It certainly did not constitute a cancellation of the RFP
since the prices for these items have not been publicly disclosed.
Grieshaber and all other offerors were entitled to revise their prices
on the forceps, given the awareness of the currently applicable
specialty metal restrictions and the considerable passage of time since
the last proposals were received. Neither the previous statements by
DPSC to Grieshaber that it was the concern apparently in line for award
of line item 0006 nor Grieshaber's small business and labor surplus area
status should preclude DPSC from amending the RFP prior to award to
advise offerors of the currently applicable legal provisions concerning
specialty metals.
The agency had indicated that the reason that it failed to make an
award to Grieshaber during the short periods in early 1983 from our
decision in A&P Surgical Company, Inc.; Columbia Surgical Instruments
Co., Inc., 62 Comp.Gen., supra, and the initiation of the lawsuit was
because it had to wait for FDA approval of Grieshaber. The approval did
not come until after the lawsuit began. Grieshaber has presented no
evidence that this was not the case. Consequently, the agency's award
during this period to another company, which apparently had the
requisite approval, was not objectionable.
The failure to notify Grieshaber of the other award under the RFP
does violate DAR Sec. 3-508.3, supra. However, such postaward
notifications are procedural in nature and provide no basis for
disturbing an otherwise valid award. Bell & Howell Corporation,
B-196165 July 29, 1981, 81-2 C.P.D. Para. 49. Indeed, Grieshaber does
not complain about the other award. The prejudice claimed by Grieshaber
is that it would have expeditiously availed itself of its remedies at
the Small Business Administration and this Office to obtain an award of
line item 0006 if it had been aware of the other awards under the RFP.
Also, Grieshaber may have intervened in the lawsuit to make sure its
award was not affected, since it was offering totally domestic specialty
metals not in controversy in that lawsuit. This alleged prejudice is
highly speculative as to how it could have resulted in an award to
Grieshaber. Further, the argument that it would have taken these steps
is not particularly convincing given the facts that Grieshaber submitted
its last proposal revision in November 1982, admits that it was aware
the lawsuit was the reason it had not received an award of item 0006
during the pendency of the lawsuit, and did not file its protest with
this Office until April 1984.
Finally, in its response to the administrative report, Grieshaber
cautions that the awards made under the RFP were probable for foreign
products. Similar contentions were made in a protest of awards to the
same supplier, to whom the award of the line items under this RFP were
awarded, on another DPSC procurement for surgical instruments. Alan
Scott Industries; Grieshaber Manufacturing Company, Inc., 63 Comp.Gen.
***, B-212703, Sept. 25, 1984, 84-2 C.P.D. para. 349, which denied the
protest, In both that case and under this RFP, that supplier offered end
products of a "participating country." See DAR Sec. 6-001.5(c), supra.
In Alan Scott Industries; Grieshaber Manufacturing Company, Inc., 63
Comp.Gen., supra, we found the RFP allowed "participating country" end
products to be evaluated equally to domestic offers, with no evaluation
preference added.
In view of the forgoing, Grieshaber's protest is denied. COMP GEN
(UP)
B-210800, APR 17, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO WILL QUESTION A DETERMINATION CONCERNING
THE TECHNICAL MERIT OF PROPOSALS ONLY UPON A CLEAR SHOWING OF
UNREASONABLENESS, ABUSE OF DISCRETION OR VIOLATION OF PROCUREMENT
STATUTES OR REGULATIONS. PROTESTER HAS FAILED TO MAKE SUCH A
SHOWING WITH RESPECT TO NASA'S DETERMINATION THAT THE TWO
PROPOSALS SUBMITTED ARE TECHNICALLY EQUAL.
2. ALLEGATION THAT OFFEROR VIOLATED 18 U.S.C. SEC. 1001
(1982) BY MISREPRESENTING ITS PAST PERFORMANCE AND ITS SUCCESS IN
OBTAINING COMMITMENTS OF EMPLOYEES DOES NOT APPEAR TO BE SUPPORTED
BY THE RECORD, AND IN ANY EVENT IS A MATTER FOR CONSIDERATION BY
THE DEPARTMENT OF JUSTICE, NOT GAO.
3. GAO WILL NOT QUESTION AN AFFIRMATIVE RESPONSIBILITY
DETERMINATION ABSENT A SHOWING OF FRAUD OR BAD FAITH BY GOVERNMENT
OFFICIALS OR A DEMONSTRATION THAT THE OFFEROR FAILED TO MEET
DEFINITIVE RESPONSIBILITY CRITERIA.
4. AGENCY DETERMINATIONS RESULTING FROM A COST
COMPARISON ANALYSIS WILL NOT BE DISTURBED UNLESS THEY CLEARLY LACK
A REASONABLE BASIS.
5. ALLEGATION THAT AN AGENCY HAS ENTERED AN
ILLEGAL PERSONAL SERVICES CONTRACT IS WITHOUT MERIT WHERE RFP AND
SELECTED PROPOSAL CLEARLY INDICATE THAT THE CONTRACTOR, NOT THE
GOVERNMENT, WILL EXERCISE SUPERVISORY AUTHORITY OVER THE
CONTRACTOR'S EMPLOYEES.
6. ILLEGAL CONFLICT OF INTEREST IS NOT PROVEN
WHERE PROTESTER HAS MERELY ALLEGED FACTS (FORMER CONTRACTING
AGENCY EMPLOYEE NOW WORKS FOR AWARDEE) THAT AT MOST ESTABLISH A
POTENTIAL FOR IMPROPRIETIES.
COMPUTER SCIENCES CORP.:
COMPUTER SCIENCES CORPORATION (CSC) PROTESTS THE AWARD OF A CONTRACT
TO SYRE, A JOINT VENTURE, UNDER REQUEST FOR PROPOSALS (RFP) NO.
2-30551(CSL) ISSUED BY THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
(NASA) FOR SCIENTIFIC AND SUPPORT SERVICES AT THE AMES RESEARCH CENTER,
MOFFETT FIELD, CALIFORNIA. NASA DETERMINED THAT THE PROPOSALS SUBMITTED
BY CSC, THE INCUMBENT CONTRACTOR FOR THIS REQUIREMENT, AND SYRE WERE OF
EQUAL TECHNICAL MERIT, AND AWARDED THE CONTRACT TO SYRE ON THE BASIS OF
ITS LOWER EVALUATED COSTS.
CSC CONTENDS THAT SYRE HAS MISREPRESENTED TO NASA THAT IT HAS
OBTAINED COMMITMENTS FROM CSC'S CURRENT EMPLOYEES AND QUESTIONS WHETHER
SYRE WILL BE ABLE TO OBTAIN THE PERSONNEL TO PERFORM THE CONTRACT. CSC
BELIEVES THAT SYRE'S RATINGS FOR EXPERIENCE AND PAST PERFORMANCE IS
SUSPECT AND ALLEGES THAT SYRE HAS COMMITTED AN ACT OF INDUSTRIAL
ESPIONAGE AGAINST CSC WHICH SHOULD RENDER IT INELIGIBLE FOR AWARD. CSC
ALLEGES THAT SYRE EMBELLISHED THE RESUMES OF ITS KEY PERSONNEL AND
REQUESTS AN INVESTIGATION OF THE MATTER.
CSC ATTACKS THE REASONABLENESS OF NASA'S COST REALISM ANALYSIS, AND
CONTENDS THAT CERTAIN INORDINATELY LOW COSTS PROPOSED BY SYRE REFLECT A
LACK OF UNDERSTANDING OF THE REQUIREMENTS OF THE RFP.
CSC ALSO QUESTIONS WHETHER THE NASA HAS ENTERED AN ILLEGAL PERSONAL
SERVICES CONTRACT AND SUGGESTS THE PROCUREMENT MAY BE TAINTED BY A
CONFLICT OF INTEREST.
WE DENY THE PROTEST.
NASA SOLICITED OFFERS TO PROVIDE SCIENTIFIC AND SUPPORT SERVICES FOR
THE SIMULATION COMPUTER FACILITIES AT THE AMES RESEARCH CENTER. THE
SUPPORT SERVICES INCLUDE A VARIETY OF ACTIVITIES RANGING FROM THE
CONSTRUCTION OF SIMULATOR COCKPIT COMPONENTS TO THE PROGRAMMING OF
SIMULATION HARDWARE.
NASA RECEIVED TWO PROPOSALS IN RESPONSE TO THE RFP, ONE FROM CSC AND
ONE FROM SYRE, A JOINT VENTURE CONSISTING OF SYSCON CORPORATION AND
REPUBLIC MANAGEMENT COMPUTER SCIENCES, INC. A SOURCE EVALUATION BOARD
JUDGED THE PROPOSALS AGAINST THE EVALUATION CRITERIA MISSION
SUITABILITY, EXPERIENCE AND PAST PERFORMANCE, AND OTHER FACTORS. THE
TWO PROPOSALS WERE ASSIGNED IDENTICAL ADJECTIVAL RATINGS FOR THE THREE
ELEMENTS OF THE MISSION SUITABILITY CRITERION. ADDITIONALLY, NASA FOUND
BOTH PROPOSALS TO BE ACCEPTABLE WITH RESPECT TO EXPERIENCE AND PAST
PERFORMANCE. SINCE THE PROPOSALS WERE CONSIDERED TO BE OF EQUAL
TECHNICAL MERIT COST BECAME THE DETERMINATIVE SELECTION FACTOR. SYRE
PROPOSED COSTS OF $15,813,332 AND CSC PROPOSED COSTS OF $18,187,915.
NASA CONDUCTED A COST REALISM ANALYSIS OF THE COST PROPOSALS AND
CONCLUDED THAT SYRE'S PROPOSED COSTS WERE UNDERSTATED BY $1,578,780
BRINGING SYRE'S EVALUATED COST TO $17,392,112. NASA FOUND CSC'S COSTS
TO BE OVERSTATED BY $124,501 RESULTING IN AN EVALUATED COST OF
$18,063,414. SINCE ITS EVALUATED COST WAS $671,302 LESS THAN CSC'S,
NASA AWARDED THE CONTRACT TO SYRE.
COMMITMENTS OF INCUMBENT'S EMPLOYEES
CSC SPECULATES THAT SYRE'S PROPOSAL INDICATES THAT SYRE HAS SECURED
COMMITMENTS FROM CSC'S PRESENT EMPLOYEES TO WORK FOR SYRE. CSC POLLED
ITS EMPLOYEES AND FOUND THAT ONLY 7 OF THE 95 EMPLOYEES WHO RESPONDED
HAD BEEN CONTACTED BY SYRE. ON THIS BASIS CSC ASSERTS THAT SYRE COULD
NOT POSSIBLY HAVE COMMITMENTS FROM A SIGNIFICANT NUMBER OF CSC
EMPLOYEES. CSC ARGUES THAT IF SYRE REPRESENTED THAT IT HAS COMMITMENTS,
THE REPRESENTATION IS FALSE AND CONSEQUENTLY SYRE'S PROPOSAL SHOULD BE
REJECTED FOR INTENTIONALLY MISLEADING THE AGENCY. ASIDE FROM ANY
POSSIBLE MISREPRESENTATION, CSC DOUBTS SYRE'S ABILITY TO FURNISH A
SUFFICIENT NUMBER OF QUALIFIED PERSONNEL AND QUESTIONS THE RATING OF
"GOOD" SYRE RECEIVED FOR UNDER THE SUBCRITERION STAFFING PLAN.
CSC'S ARGUMENT ON MISREPRESENTATION IS NOT SUPPORTED BY THE RECORD.
SYRE, IN ITS PROPOSAL, ESTIMATED THAT IT COULD RETAIN MORE THAN 80
PERCENT OF CSC'S EMPLOYEES, BUT SYRE DID NOT REPRESENT THAT IT HAD
SECURED COMMITMENTS FROM CSC'S EMPLOYEES. RATHER, SYRE SET FORTH A PLAN
UNDER WHICH IT WOULD RECRUIT THE EMPLOYEES AFTER IT WAS AWARDED A
CONTRACT. IT IS OBVIOUS THAT THERE WAS NO MISREPRESENTATION CONCERNING
COMMITMENTS OF EMPLOYEES, AND WE WILL NOT CONDUCT AN INVESTIGATION OF
THE MATTER AS CSC REQUESTS. SEE MONCHIK-WEBER ASSOCIATES, INC.,
B-196433, AUGUST 8, 1980, 80-2 CPD 102.
CONCERNING CSC'S ARGUMENT THAT SYRE'S RATING FOR STAFFING PLAN WAS
IMPROPER, WE POINT OUT THAT IT IS NEITHER OUR FUNCTION NOR OUR PRACTICE
TO CONDUCT A DE NOVO REVIEW OF TECHNICAL PROPOSALS AND MAKE AN
INDEPENDENT DETERMINATION OF THEIR RELATIVE TECHNICAL MERIT. IT IS THE
FUNCTION OF THE PROCURING AGENCY TO EXERCISE INFORMED JUDGMENT AND
DISCRETION IN THE EVALUATION OF PROPOSALS. OUR REVIEW IS LIMITED TO
EXAMINING WHETHER THE AGENCY'S EVALUATION WAS FAIR, REASONABLE AND
CONSISTENT WITH THE STATED EVALUATION CRITERIA. WE WILL QUESTION
CONTRACTING OFFICIALS' DETERMINATIONS CONCERNING THE TECHNICAL MERITS OF
PROPOSALS ONLY UPON A CLEAR SHOWING OF UNREASONABLENESS, ABUSE OF
DISCRETION OR VIOLATION OF PROCUREMENT STATUTES OR REGULATIONS.
RELIABILITY SCIENCES, INCORPORATED, B-205754.2, JUNE 7, 1983, 83-1 CPD
612.
CSC HAS NOT DEMONSTRATED THAT NASA'S EVALUATION OF SYRE'S STAFFING
PLAN WAS UNREASONABLE. NASA PREMISED ITS CONCLUSION THAT SYRE COULD
SECURE CSC'S EMPLOYEES ON SYRE'S PROPOSAL TO OFFER THE EMPLOYEES NO LESS
THAN THEIR PRESENT SALARY; ON SYRE'S AGGRESSIVE RECRUITING PLAN; ON
SYSCON'S PAST EXPERIENCE OF RETAINING HIGH PERCENTAGES OF EMPLOYEES
DURING THE PHASE-IN OF SIMILAR CONTRACTS; AND ON SYRE'S TELEPHONE
SURVEY INDICATING A GENERAL EMPLOYEE INTEREST IN MAINTAINING EMPLOYMENT
AT AMES RATHER THAN RELOCATING WITH CSC IN THE EVENT CSC WAS NOT AWARDED
A CONTRACT.
CSC ARGUES THAT NASA, BY RELYING ON THE TELEPHONE SURVEY, HAS EQUATED
AN INDICATION BY THE SURVEYED EMPLOYEES OF A DESIRE TO REMAIN AT AMES
WITH AN EXPRESSION OF INTENT TO WORK FOR SYRE. THIS ARGUMENT ASSUMES
THAT OFFERORS WERE REQUIRED TO SECURE COMMITMENTS OR STATEMENTS OF
INTENT FROM PROSPECTIVE EMPLOYEES PRIOR TO THE AWARD OF A CONTRACT.
THIS ASSUMPTION IS INCORRECT. ALTHOUGH THE RFP REQUESTS OFFERORS TO
IDENTIFY THE COMMITMENTS BY KEY PERSONNEL, THERE IS NO REQUIREMENT TO
OBTAIN COMMITMENTS FROM OTHER EMPLOYEES. THE RFP MERELY REQUIRES THE
SUBMISSION OF A STAFFING PLAN INDICATING AN UNDERSTANDING OF THE
RESOURCES REQUIRED, AND THE PROVISION OF A RECORD OF RECRUITING SUCCESS
FOR SIMILAR REQUIREMENTS.
CSC ALSO ASSERTS THAT THE TELEPHONIC SURVEY, SINCE IT DID NOT REQUEST
EMPLOYEES TO INDICATE AN INTENT TO WORK FOR SYRE, IS THE ANTITHESIS OF
AGGRESSIVE RECRUITING. IT IS OBVIOUS, HOWEVER, THAT THE RECRUITING PLAN
REQUESTED BY THE RFP AND CONTEMPLATED BY SYRE'S PROPOSAL IS TO COMMENCE
AFTER THE AWARD OF THE CONTRACT, NOT PRIOR TO THE SUBMISSION OF
PROPOSALS AS CSC'S ARGUMENT SUGGESTS. WE FIND NASA'S CONCLUSION
CONCERNING SYRE'S STAFFING PLAN TO BE REASONABLE ON ITS FACE AND CSC HAS
NOT PRESENTED ANY EVIDENCE OR ARGUMENTATION WHICH WOULD INDICATE
OTHERWISE.
PAST PERFORMANCE AND EXPERIENCE
BOTH CSC AND SYRE RECEIVED RATINGS OF ACCEPTABLE FOR THE PAST
PERFORMANCE AND EXPERIENCE EVALUATION CRITERION. CSC QUESTIONS SYRE'S
RATING ON THE GROUND THAT NASA WAS UNAWARE THAT A SUBCONTRACT HELD BY
SYSCON, ONE OF THE JOINT VENTURERS, HAD BEEN TERMINATED BY FORD
AEROSPACE UNDER A NAVY PRIME CONTRACT AND THAT SYSCON WAS EXPERIENCING
MAJOR CONTRACT PERFORMANCE PROBLEMS WITH RESPECT TO NAVAL FACILITIES AT
CHINA LAKE AND VALLEJO, CALIFORNIA. CSC CONTENDS THAT EITHER SYRE
EXCLUDED THESE CONTRACTS FROM THE LIST OF RELEVANT EXPERIENCE IN ITS
PROPOSAL, POSSIBLY VIOLATING 18 U.S.C. SEC. 1001, OR, IF SYRE DID LIST
THESE CONTRACTS, THAT NASA DID NOT PROPERLY INVESTIGATE THIS ASPECT OF
SYRE'S PROPOSAL.
CSC'S ALLEGATIONS CONCERNING MAJOR PERFORMANCE DIFFICULTIES WITH NAVY
CONTRACTS AT CHINA LAKE AND VALLEJO ARE WITHOUT MERIT. SYRE'S PROPOSAL
REFERRED TO A CONTRACT FOR EFFECTIVENESS ANALYSIS SERVICES AT THE NAVAL
WEAPONS CENTER, CHINA LAKE, CALIFORNIA AND TO A CONTRACT FOR
ENGINEERING, TECHNICAL WRITING AND DRAFTING SERVICES AT THE NAVAL
ELECTRONICS SYSTEMS ENGINEERING CENTER, VALLEJO, CALIFORNIA. NASA SENT
CONTRACT PERFORMANCE QUESTIONNAIRES TO BOTH FACILITIES AND RECEIVED A
RESPONSE FROM THE NAVAL WEAPONS CENTER WHICH INDICATED SATISFACTORY
PERFORMANCE ON THE PART OF SYSCON. NASA DID NOT RECEIVE A RESPONSE
REGARDING THE OTHER CONTRACT PRIOR TO THE SELECTION, BUT DURING THE
PENDENCY OF THIS PROTEST THE CONTRACTING OFFICIALS AT THE NAVAL FACILITY
ADVISED NASA THAT SYSCON'S PERFORMANCE WAS SATISFACTORY. THUS, CSC IS
INCORRECT BOTH IN ITS SPECULATION THAT SYRE FAILED TO MENTION THE
CONTRACTS AND IN ITS ASSERTION THAT SYSCON WAS EXPERIENCING PERFORMANCE
DIFFICULTIES.
CSC IS CORRECT, HOWEVER, THAT SYRE DID NOT LIST THE SUBCONTRACT WITH
FORD AEROSPACE IN ITS PROPOSAL AND THAT THE CONTRACT HAS BEEN
TERMINATED. FORD AEROSPACE OFFICIALS INFORMED NASA, AFTER THIS PROTEST
WAS FILED, THAT IT TERMINATED THE CONTRACT FOR CONVENIENCE BECAUSE THE
COMPANY DEEMED IT IN ITS INTEREST TO PERFORM THE SERVICES IN-HOUSE.
NONETHELESS, THE TERMINATION WAS FOR CONVENIENCE, NOT FOR DEFAULT,
AND IT DOES NOT ESTABLISH THAT NASA'S EVALUATION OF SYRE'S PAST
PERFORMANCE AND EXPERIENCE WAS UNREASONABLE. SYRE LISTED NUMEROUS
RELATED CONTRACTS PERFORMED BY SYSCON AND REPUBLIC AND NASA'S
INVESTIGATION OF THESE CONTRACTS, BY QUESTIONNAIRE AND TELEPHONE
INQUIRY, REVEALED THAT THE PERFORMANCE OF THE CONTRACTS BY THE TWO FIRMS
WAS RATED AS ADEQUATE TO SUPERIOR. THERE WAS NO WAY FOR NASA TO KNOW OF
THE SUBCONTRACT, AND EVEN IF IT HAD, THERE WOULD STILL BE A REASONABLE
BASIS (ADEQUATE TO SUPERIOR RATINGS ON ALL OTHER CONTRACTS) TO SUPPORT A
FINDING OF ACCEPTABLE PAST PERFORMANCE.
CONCERNING SYRE'S FAILURE TO MENTION THE FORD AEROSPACE SUBCONTRACT
IN ITS PROPOSAL, WE POINT OUT THAT THE RFP REQUESTED INFORMATION ABOUT
ONLY THESE CONTRACTS FOR MORE THAN $1 MILLION. THE RECORD DOES NOT
INDICATE WHETHER THIS EFFORT EXCEEDED THIS THRESHOLD. IN ANY EVENT, THE
STATUTORY PROVISION CITED BY CSC CRIMINALLY PROSCRIBES KNOWING
CONCEALMENT OF A MATERIAL FACT IN ANY MATTER WITHIN THE JURISDICTION OF
ANY DEPARTMENT OR AGENCY OF THE UNITED STATES. THE QUESTION OF WHETHER
A FIRM HAS VIOLATED A CRIMINAL STATUTE IS WITHIN THE JURISDICTION OF THE
ATTORNEY GENERAL AND THE FEDERAL COURTS, NOT THE GENERAL ACCOUNTING
OFFICE, AND THEREFORE WE WILL NOT CONSIDER CSC'S ALLEGATION. SEE AARID
VAN LINES, INC., B-206080, FEBRUARY 4, 1982, 82-1 CPD 92.
LAST, CSC SUGGESTS THAT SYRE'S FAILURE TO LIST THE SUBCONTRACT CALLS
INTO QUESTION SYRE'S CREDIBILITY AND INTEGRITY. BUSINESS INTEGRITY AND
HONESTY ARE MATTERS RELATING TO A FIRM'S RESPONSIBILITY AND IN THIS
CASE, NASA HAS DETERMINED SYRE TO BE RESPONSIBLE. WE WILL NOT REVIEW
ALLEGATIONS AGAINST AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY
ABSENT A SHOWING OF FRAUD OR BAD FAITH ON THE PART OF AGENCY OFFICIALS
OR A SHOWING THAT THE OFFEROR DID NOT MEET DEFINITIVE RESPONSIBILITY
CRITERIA SET FORTH IN THE SOLICITATION. JACK ROACH CADILLAC, INC.,
B-210043, JUNE 27, 1983, 83-2 CPD 25. CSC HAS NOT MADE EITHER SHOWING.
INDUSTRIAL ESPIONAGE
CSC ALLEGES THAT SYSCON HAS ATTEMPTED AN ACT OF INDUSTRIAL ESPIONAGE
AT THE AMES FACILITY. PRIOR TO THE SELECTION OF SYRE, CSC REPORTED TO
NASA THAT AT LEAST ONE SYSCON EMPLOYEE GAINED ACCESS TO A LIBRARY AT
AMES BY REPRESENTING HIMSELF AS A NASA EMPLOYEE IN ORDER TO SECURE
CERTAIN PROPRIETY DATA OF CSC. NASA FOUND THE ALLEGATION TO BE
GROUNDLESS. NASA POINTED OUT THAT SYSCON, WHICH HOLDS A QUALITY
ASSURANCE CONTRACT AT AMES, HAS UNLIMITED ACCESS TO THE LIBRARY AND THAT
IN ANY EVENT, THE LIBRARY IS A NASA FACILITY, NOT A CSC FACILITY WHERE
PROPRIETARY INFORMATION COULD BE EXPECTED TO BE FOUND.
CSC ARGUES THAT NASA'S FINDINGS ARE BASED ON SPECULATION, THAT NASA
DID NOT ACTUALLY INVESTIGATE THE MATTER OR QUESTION THE EMPLOYEE
INVOLVED. CSC ALSO BELIEVES NASA'S FINDING IS INCONSISTENT WITH THE
FACT THAT THE EMPLOYEE FALSELY REPRESENTED HIMSELF AS A NASA EMPLOYEE.
THE PROTESTER CONTENDS THAT THE INCIDENT INDICATES THAT SYSCON LACKS
BUSINESS INTEGRITY AND ITS PROPOSAL SHOULD HAVE BEEN REJECTED ON THIS
BASIS.
WE NOTE THAT NASA DID MAKE INQUIRIES CONCERNING THE INCIDENT AND
SATISFIED ITSELF THAT AN ACT OF INDUSTRIAL ESPIONAGE HAD NOT OCCURRED.
IN ANY EVENT CSC'S ALLEGATION CONCERNS THE RESPONSIBILITY OF SYRE. NASA
HAS DETERMINED THAT SYRE IS RESPONSIBLE, AND AS NOTED ABOVE SUCH
DETERMINATIONS WILL NOT BE REVIEWED ABSENT CIRCUMSTANCES NOT EVIDENT
HERE. SEE KECO INDUSTRIES, INC., B-204719, JULY 6, 1982, 82-2 CPD 16.
EMBELLISHMENT OF RESUMES
CSC STATES THAT IT HAS HEARD RUMORS TO THE EFFECT THAT THE RESUMES
FURNISHED BY SYRE WERE EMBELLISHED TO MAKE THE KEY PERSONNEL APPEAR TO
BE MORE QUALIFIED THAN THEY ACTUALLY ARE. CSC REQUESTS THAT WE
INVESTIGATE THE MATTER IN ORDER TO ASSURE THE INTEGRITY OF THE
PROCUREMENT PROCESS.
ALTHOUGH WE HAVE ON OCCASION CONDUCTED INVESTIGATIONS OF PROTESTER
ALLEGATIONS ON OUR OWN INITIATIVE, WE GENERALLY DO NOT CONDUCT
INVESTIGATIONS PURSUANT TO OUR BID PROTEST FUNCTION FOR THE PURPOSE OF
ESTABLISHING A PROTESTER'S SPECULATIVE STATEMENTS. WESTERN ECOLOGICAL
SERVICES COMPANY, B-201097, APRIL 30, 1981, 81-1 CPD 333. THEREFORE, WE
DENY THE REQUEST FOR AN INVESTIGATION.
COST REALISM ANALYSIS
SYRE PROPOSED A TOTAL COST OF $15,813,332. IN ASSESSING SYRE'S COST
PROPOSAL, NASA CONDUCTED AN INDEPENDENT SALARY SURVEY, AND DETERMINED
THAT SYRE UNDERSTATED SALARIES FOR ENGINEERING STAFF AND TECHNICIANS.
NASA ALSO DETERMINED THAT SYRE WOULD REQUIRE ADDITIONAL TECHNICIANS TO
PERFORM THE CONTRACT. CONSEQUENTLY, NASA DETERMINED THAT SYRE'S COST
WOULD BE $1,578,780 GREATER THAN STATED IN COST PROPOSAL, MAKING THE
TOTAL PROBABLE COST $17,392,112. IN COMPARISON, NASA DETERMINED THAT
CSC'S PROPOSED COST OF $18,187,915 WAS OVERSTATED BY $123,501, RESULTING
IN A PROBABLE COST OF $18,063,414.
THE CONDUCT OF A COST REALISM ANALYSIS IS THE FUNCTION OF THE
CONTRACTING AGENCY AND WE WILL NOT DISTURB DETERMINATIONS MADE BY THE
AGENCY AS A RESULT OF SUCH AN ANALYSIS UNLESS THEY CLEARLY LACK A
REASONABLE BASIS. MANAGEMENT SERVICES INC., 55 COMP.GEN. 715 (1976),
76-1 CPD 74; MOSHMAN ASSOCIATES INC., B-192008, JANUARY 16, 1979, 79-1
CPD 23.
CSC BELIEVES THE APPROXIMATELY 1.6 MILLION "ADJUSTMENT" OF SYRE'S
PROPOSAL EXCEEDS THE PROPER EXERCISE OF DISCRETION AND JUDGMENT TO THE
POINT OF IRRATIONALITY. CSC POINTS OUT THAT SYRE PROPOSED TECHNICIAN
SALARIES 25 PERCENT LOWER THAN CSC CURRENTLY PAYS ITS TECHNICIANS. CSC
STATES THAT IT PAYS TECHNICIANS WELL OVER THE "GOING RATE" FOR
TECHNICIANS IN THE AREA BECAUSE OF THE UNIQUE TECHNICIAN SKILLS DEMANDED
BY THE EFFORT. THE PROTESTER CONTENDS THAT SYRE PROPOSED RIDICULOUSLY
LOW SALARIES WITHOUT SURVEYING THE SALARIES OF CSC'S CURRENT EMPLOYEES,
LEAVING NASA TO FIGURE OUT REALISTIC TECHNICIAN SALARIES. CSC BELIEVES
THAT NASA HAS IMPERMISSIBLY REWRITTEN SYRE'S PROPOSAL BY DETERMINING
REALISTIC SALARIES AND ADJUSTING SYRE'S PROPOSAL TO REFLECT THEM.
ADDITIONALLY, CSC BELIEVES THAT SYRE'S PROPOSAL OF INORDINATELY LOW
SALARIES REFLECTS A LACK OF UNDERSTANDING OF THE RFP'S REQUIREMENTS. ON
THIS BASIS, CSC SUGGESTS THAT SYRE SHOULD NOT HAVE RECEIVED RATING OF
EXCELLENT FOR THE EVALUATION SUBCRITERION UNDERSTANDING THE PROBLEM.
FIRST, NASA HAS NOT IN ANY SENSE REWRITTEN THE SYRE'S PROPOSAL. WE
HAVE FREQUENTLY EMPHASIZED THE IMPORTANCE OF ANALYZING PROPOSED COSTS TO
DETERMINE WHETHER THEY ARE REALISTIC PREDICTIONS, SINCE, REGARDLESS OF
AN OFFEROR'S PROPOSED COSTS, THE GOVERNMENT WILL BE OBLIGATED UNDER A
COST REIMBURSEMENT CONTRACT TO REIMBURSE THE CONTRACTOR FOR ITS
ALLOWABLE COSTS. SEE DYNALECTRON CORPORATION, ET AL., 54 COMP.GEN. 562
(1975), 75-1 CPD 17, AFFIRMED, 54 COMP.GEN. 1009 (1975), 75-1 CPD 341.
CLEARLY, NASA DID NOT REWRITE SYRE'S COST PROPOSAL, BUT RATHER
DETERMINED FOR ITS OWN EVALUATION PURPOSES WHAT THE PROBABLE AND
REALISTIC COST OF CONTRACTING WITH SYRE WOULD BE.
NEXT, THE FACT THAT SYRE'S PROPOSED SALARIES WERE SUBSTANTIALLY LOWER
THAN CSC'S DOES NOT IN ITSELF PRESENT A BASIS UPON WHICH TO QUESTION THE
SELECTION. AS NASA POINTS OUT, SYRE DID NOT HAVE ACCESS TO CSC'S SALARY
DATA AND THE RFP DID NOT REQUIRE OFFERORS TO CONDUCT A SURVEY OF THE
SALARY OF INCUMBENT PERSONNEL. SYRE'S PROPOSED SALARIES WERE CONSISTENT
WITH GENERAL DATA (TO WHICH SYRE DID HAVE ACCESS) FOR TECHNICIAN
SALARIES IN THE AREA, AND WERE WELL ABOVE THE APPLICABLE SERVICE
CONTRACT ACT WAGE DETERMINATIONS SET FORTH IN THE RFP. UNDER THE
CIRCUMSTANCES, IT WOULD NOT APPEAR THAT SYRE'S PROPOSED SALARIES
RESULTED FROM BAD FAITH OR LACK OF DILIGENCE IN ASCERTAINING WAGES AS
CSC'S ARGUMENTS SEEM TO SUGGEST, BUT RATHER REFLECTED A REASONABLE
ATTEMPT TO ESTIMATE TECHNICIAN WAGES IN THE AREA. WE OBSERVE THAT SYRE
PROMISED IN ITS PROPOSAL TO OFFER INCUMBENT EMPLOYEES AT LEAST THEIR
CURRENT SALARIES. SINCE NASA, IN CONTRAST TO SYRE, WAS AWARE OF THE
CURRENT SALARIES OF CSC'S EMPLOYEES, ITS ASSESSMENT OF THE PROBABLE COST
OF SYRE'S FULFILLING THIS CONTRACTUAL PROMISE WAS APPROPRIATE.
LAST, GIVEN THE ABOVE DISCUSSION, IT IS CLEAR THAT SYRE'S
UNDERSTATEMENT OF TECHNICIAN SALARIES DOES NOT RAISE AN INFERENCE THAT
SYRE DID NOT UNDERSTAND THE REQUIREMENT OF THE RFP OR THE RESOURCES
NECESSARY TO ACCOMPLISH THE REQUIREMENTS. RATHER, THE UNDERSTATEMENT
REFLECTS A LACK OF DATA REGARDING CSC'S SALARIES FOR TECHNICIANS.
THEREFORE, CSC HAS NOT PRESENTED A BASIS UPON WHICH TO QUESTION THE
REASONABLENESS OF SYRE'S RATING OF EXCELLENT FOR UNDERSTANDING THE
PROBLEM.
CSC ALLEGES THAT SYRE'S COST PROPOSAL WAS DEFICIENT AND THE COST
ANALYSIS WAS UNREASONABLE IN OTHER LESS SIGNIFICANT RESPECTS. FIRST,
CSC OBSERVES THAT SYRE PROPOSED LOWER SALARIES FOR MANAGERIAL PERSONNEL
THAN CSC IS NOW PAYING AND SURMISES FROM THIS THAT SYRE WILL HAVE TO
BRING IN MANAGEMENT PERSONNEL FROM ELSEWHERE. CSC CONTENDS THAT NASA
DID NOT CONSIDER COSTS TO SYRE OF RELOCATING MANAGEMENT PERSONNEL, AN
EXPENSE THAT CSC SPECULATES WOULD AMOUNT TO AT LEAST $560,000.
SYRE'S PROPOSED MANAGEMENT STRUCTURE INCLUDES A CONTRACT DIRECTOR, A
DEPUTY CONTRACT DIRECTOR, FOUR MANAGERS AND ELEVEN GROUP LEADERS.
ALTHOUGH SYRE'S SALARIES FOR UPPER LEVEL MANAGEMENT ARE LESS THAN CSC'S,
ITS SALARIES FOR GROUP LEADERS ARE GREATER, FOR THE MOST PART, THAN
CSC'S. SYRE'S COST PROPOSAL STATES THAT TEN MANAGERS WILL BE RELOCATED,
TWO FROM THE EAST COAST AND THE REMAINDER FROM OTHER POINTS ON THE WEST
COAST, AT A COST SUBSTANTIALLY LESS THAN THAT ASSERTED BY CSC. THESE
COSTS ARE BASED ON THE RELOCATION COST EXPERIENCE OF SYSCON AND THEY DO
NOT APPEAR TO BE FACIALLY UNREASONABLE. GIVEN THE FACT THAT THE SALARY
RATE DESIGNATED BY SYRE FOR GROUP LEADERS IS GREATER THAN OR EQUAL TO
THE SALARIES CSC PROPOSED FOR GROUP LEADERS, IT IS REASONABLE TO ASSUME
SYRE COULD FILL THE SEVEN REMAINING POSITIONS WITHOUT INCURRING
ADDITIONAL RELOCATION EXPENSES. CONSEQUENTLY, WE FIND REASONABLE NASA'S
ACCEPTANCE OF SYRE'S ESTIMATED COST OF RELOCATION.
NEXT CSC QUESTIONS WHETHER SYRE'S FIRST YEAR COSTS WERE FOR AN
11-MONTH EFFORT PLUS A PHASE-IN PERIOD OF 1 MONTH OR FOR A FULL 12-MONTH
EFFORT, THE COSTS OF WHICH, UNDER THE RFP, ARE SEPARATELY EVALUATED.
CSC CONTENDS THAT IF ONLY THE COSTS WERE FOR ONLY 11 MONTHS, NASA DID
NOT COMPARE THE TWO FIRMS' COSTS ON AN EQUAL BASIS SINCE CSC PROPOSED
COSTS BASED ON 12 MONTHS OF PERFORMANCE.
SYRE'S COST PROPOSAL WAS IN FACT EVALUATED ON 12 MONTHS OF
PERFORMANCE IN THE FIRST YEAR AND THEREFORE CSC'S ASSERTION IS WITHOUT
BASIS.
CSC CONTENDS THAT SYRE'S OVERHEAD COSTS ARE SO LOW, 29 PERCENT OF
DIRECT LABOR COSTS COMPARED WITH CSC'S 33 PERCENT, THAT EITHER SYRE DOES
NOT COMPREHEND THE TECHNICAL EFFORT OR THE FIRM PLANS TO ENGAGE IN
WAGE-BUSTING. CSC BELIEVES SYRE CONSEQUENTLY SHOULD HAVE BEEN
DISQUALIFIED FROM THE COMPETITION.
WE FAIL TO SEE HOW A LOW OVERHEAD RATE SUPPORTS AN INFERENCE OF LACK
OF UNDERSTANDING OF THE TECHNICAL EFFORT REQUIRED. IN ANY EVENT, WE
HAVE CLOSELY EXAMINED SYRE'S COST PROPOSAL AND FIND THAT IT PROVIDES
ESSENTIALLY THE SAME PANOPLY OF FRINGE BENEFITS AS CSC'S PROPOSAL, BUT
AT SLIGHTLY LOWER RATES. NASA FOUND THAT SYRE HAD INCLUDED ALL
COMPENSATION REQUIRED BY LAW AND THUS FOUND NO INDICATION OF
"WAGE-BUSTING." WE CAN CONCEIVE OF NO REASON WHY A RELATIVELY LOW
OVERHEAD RATE WOULD DISQUALIFY AN OFFEROR. WE REJECT CSC'S ARGUMENTS.
CSC ASSERTS THAT NASA IMPROPERLY PENALIZED CSC WITH RESPECT TO
INDIRECT COSTS. CSC STATES THAT ITS INDIRECT COSTS WERE HIGH IN PART
BECAUSE IT INCLUDED INDIRECT SUPPORT BY FIVE INDIVIDUALS. CSC CONTENDS
THAT SYRE DID NOT INCLUDE SIMILAR INDIRECT COSTS AND THAT SYRE IN FACT
PLANS TO PROVIDE INDIRECT SUPPORT FROM A SYSCON FACILITY AT NO COST.
CSC IS SIMPLY INCORRECT IN ITS ASSERTION THAT IT WAS PENALIZED FOR
ITS HIGHER OVERHEAD COSTS. AS NASA INDICATES, CSC'S MANAGEMENT
STRUCTURE BUILT IN MORE INDIRECT COSTS THAN DID SYRE'S AND THESE COSTS
WERE PROPERLY REFLECTED IN CSC'S PROPOSAL. SYRE DID OFFER TO PROVIDE
CERTAIN INDIRECT SUPPORT SERVICES WITHOUT CHARGE, AS CSC ASSERTS, BUT WE
DO NOT PERCEIVE ANY BASIS UPON WHICH TO OBJECT TO SUCH AN ARRANGEMENT.
AS A RESULT OF SYRE'S WILLINGNESS TO ABSORB CERTAIN COSTS, CSC'S
INDIRECT COSTS WERE HIGHER THAN SYRE'S AND THIS CONTRIBUTED TO THE
OVERALL COST ADVANTAGE REPRESENTED BY SYRE'S PROPOSAL. WE WOULD NOT
DESCRIBE AWARDING ON THE BASIS OF LOWER COSTS AS PENALIZING OTHER
OFFERORS, AND IN ANY EVENT, THERE IS NOTHING IMPROPER IN SO AWARDING A
CONTRACT.
LAST, CSC ASSERTS THAT SYRE UNDERSTATED ITS COSTS BY PROPOSING
INADEQUATE STAFFING LEVELS. THIS CONTENTION HAS NO FOUNDATION IN THE
RECORD.
THE GOVERNMENT ESTIMATE SET FORTH IN THE RFP IS THAT 145 DIRECT
WORKYEARS WILL BE REQUIRED TO PERFORM THE CONTRACT. SYRE PROPOSED TO
SUPPLY 145 WORKYEARS AND AS NOTED, NASA DETERMINED THAT AN ADDITIONAL
TECHNICIAN WORKYEAR WOULD BE NECESSARY UNDER SYRE'S STAFFING PLAN. NASA
THEREFORE ADDED THE COST OF THE TECHNICIAN MANYEAR IN DETERMINING SYRE'S
REALISTIC COSTS. IN CONTRAST, CSC PROPOSED 139 DIRECT WORKYEARS, TO
WHICH NASA ADDED ONE ENGINEER WORKYEAR IN CONNECTION WITH THE COST
REALISM ANALYSIS. THUS, SYRE'S STAFFING LEVEL IS CONSISTENT WITH THE
GOVERNMENT ESTIMATE AND GREATER THAN THAT OF CSC ITSELF. IN OUR VIEW,
CSC HAS NOT PROVIDED ANY FACTS TO SUPPORT ITS ALLEGATION AND WE FIND NO
BASIS TO CONCLUDE THAT SYRE'S STAFFING LEVEL WAS INADEQUATE.
IN CONCLUSION, CSC HAS NEITHER PRESENTED A BASIS UPON WHICH TO
QUESTION THE REASONABLENESS OF NASA'S ASSESSMENT OF THE RELATIVE COSTS
OF THE TWO FIRMS, NOR HAS IT DEMONSTRATED THAT CERTAIN LOW COSTS
PROPOSED BY SYRE INDICATE A FAILURE TO COMPREHEND THE TECHNICAL EFFORT
REQUIRED BY THE RFP.
ILLEGAL PERSONAL SERVICES CONTRACT
NASA DISCERNED A WEAKNESS IN CSC'S PROPOSAL IN THAT THE DEGREE OF
LOWER LEVEL MANAGEMENT WAS EXCLUSIVE. THUS, NASA RATED CSC AS GOOD WITH
RESPECT TO THE EVALUATION SUBCRITERION MANAGEMENT PLAN, WHILE ASSIGNING
AN ADJECTIVAL RATING OF EXCELLENT TO SYRE. CSC BELIEVES NASA'S
CRITICISM INDICATES A DESIRE BY NASA TO SUPERVISE CONTRACTOR EMPLOYEES
DIRECTLY, RAISING AN INFERENCE THAT NASA HAS IN EFFECT ENTERED AN
ILLEGAL PERSONAL SERVICES CONTRACT WITH SYRE'S EMPLOYEES.
THE GENERAL RULE, ESTABLISHED BY DECISIONS OF OUR OFFICE AND THE
FORMER CIVIL SERVICE COMMISSION, IS THAT PERSONAL SERVICES MAY NOT BE
OBTAINED ON A CONTRACTUAL BASIS, BUT RATHER MUST BE PERFORMED BY
PERSONNEL EMPLOYED IN ACCORDANCE WITH THE CIVIL SERVICE AND
CLASSIFICATION LAWS. CONTRACTS FOR SERVICES ARE PROSCRIBED IF THEY
ESTABLISH AN EMPLOYER-EMPLOYEE RELATIONSHIP BETWEEN THE GOVERNMENT AND
CONTRACTING PERSONNEL. UNITED STATES ADVISORY COMMISSION ON PUBLIC
DIPLOMACY, B-202159, NOVEMBER 6, 1981, 81-2 CPD 404. THE CRITICAL
FACTOR IN DETERMINING WHETHER AN EMPLOYER-EMPLOYEE RELATIONSHIP EXISTS
IS THE PRESENCE OF ACTUAL SUPERVISION OF CONTRACTOR PERSONNEL BY
GOVERNMENT OFFICERS AND EMPLOYEES. LODGE 1858, AMERICAN FEDERATION OF
GOVERNMENT EMPLOYEES ET AL. V. WEBB, 580 F.2D 496 (D.C. CIR. 1978);
CONSULTANT SERVICES-T.C. ASSOCIATES, B-193035, APRIL 12, 1979, 79-1 CPD
260.
CERTAIN PROVISIONS OF THE RFP AND SYRE'S PROPOSAL REFUTE CSC'S
CONTENTION THAT THE CONTRACT GIVES NASA SUPERVISORY AUTHORITY OVER
SYRE'S EMPLOYEES. THE STATEMENT OF WORK PROVIDES THAT:
"THE CONTRACTOR SHALL BE RESPONSIBLE FOR
MANAGEMENT AND ADMINISTRATION OF ALL TASKS
ASSIGNED UNDER THE CONTRACT AND BEARS THE
TOTAL RESPONSIBILITY FOR THE TECHNICAL AND
FINANCIAL PERFORMANCE OF THE CONTRACT. THE
CONTRACTOR'S ASSIGNED CONTRACTOR DIRECTOR IS
THE MAIN POINT OF CONTACT BETWEEN THE GOVERNMENT
AND THE CONTRACTOR FOR TECHNICAL DIRECTION
AND FINANCIAL CONTROLS. HOWEVER, HE MAY
DELEGATE SPECIFIC TECHNICAL AREAS TO KEY MEMBERS
OF HIS STAFF."
THE STATEMENT OF WORK CONTINUES BY SETTING FORTH SPECIFIC SUPERVISORY
RESPONSIBILITIES OF THE CONTRACTOR. THUS, THE RFP UNAMBIGUOUSLY ASSIGNS
MANAGERIAL RESPONSIBILITY TO THE CONTRACTOR, NOT TO NASA.
IN RESPONSE TO THE MANAGERIAL REQUIREMENTS OF THE RFP, SYRE PROPOSED
A MANAGEMENT STRUCTURE CONSISTING OF A CONTRACT DIRECTOR, A DEPUTY
CONTRACT DIRECTOR, FOUR MANAGERS AND SIX GROUP LEADERS. CSC PROPOSED A
VERY SIMILAR MANAGEMENT STRUCTURE EXCEPT THAT IT INCLUDED SEVENTEEN
LOWER LEVEL MANAGERS IN CONTRAST TO SYRE'S SIX. THUS AT THE LOWEST LEVEL
OF MANAGEMENT SYRE PROPOSED ONE SUPERVISOR (GROUP LEADER) FOR EVERY
TWENTY-FIVE EMPLOYEES AS OPPOSED TO CSC'S ONE SUPERVISOR FOR EVERY NINE
EMPLOYEES. THIS STATISTIC REASONABLY LED NASA TO REGARD SYRE'S STRUCTURE
AS MORE EFFICIENT AND LESS COSTLY THAN CSC'S, BUT IT DOES NOT PROVIDE A
PLAUSIBLE BASIS FOR ASSERTING THAT THE CONTRACT WOULD IN EFFECT DELEGATE
SUPERVISORY AUTHORITY TO NASA. GIVEN THE LANGUAGE EMPLOYED BY THE RFP
AND THE MANAGEMENT PLAN ESTABLISHED BY SYRE'S PROPOSAL, WE FIND THAT
UNDER THE TESTS ESTABLISHED BY THE COURTS AND OUR OFFICE, THE CONTRACT
CANNOT PLAUSIBLY BE CHARACTERIZED AS A PERSONAL SERVICES CONTRACT. SEE
CONSULTANT SERVICES - T.C. ASSOCIATES, SUPRA.
CONFLICT OF INTEREST
CSC BELIEVES THAT SYRE'S EFFORTS TO SECURE A CONTRACT MAY HAVE
VIOLATED CONFLICT OF INTEREST LAWS OR REGULATIONS. CSC POINTS OUT THAT A
FORMER NASA EMPLOYEE WHOSE RESPONSIBILITIES INCLUDED OVERSIGHT OVER
CSC'S PRIOR CONTRACT FOR SUPPORT SERVICES AT AMES, IS NOW EMPLOYED BY
SYSCON AND/OR SYRE. CSC ALLEGES THAT THE EMPLOYEE WAS INSTRUMENTAL IN
THE WRITING OF SYRE'S PROPOSAL AND MAY HAVE PARTICIPATED IN OTHER
ASPECTS OF THE COMPETITION. CSC CITES THE UNITED STATES CLAIMS COURT
DECISION IN CACI, INC.-FEDERAL V. U.S., 1 CL.CT. 352 (1983), FOR THE
PROPOSITION THAT THE EMPLOYEE'S ACTIVITIES ON BEHALF OF SYRE VIOLATED
CONFLICT OF INTEREST STRICTURES AND REQUIRE THE REJECTION OF SYRE'S
PROPOSAL.
THE RECORD INDICATES THAT A FORMER NASA EMPLOYEE, WITH THE
RESPONSIBILITIES ALLEGED BY CSC, BECAME ASSOCIATED WITH SYSCON PRIOR TO
THE ISSUANCE OF THE RFP. NASA REPORTS THAT ONCE THE EMPLOYEE ANNOUNCED
HIS PLANS TO LEAVE THE GOVERNMENT, NASA ISOLATED THE EMPLOYEE FROM
MATTERS RELATING TO THIS PROCUREMENT. THE EMPLOYEE DID NOT AFTER
BECOMING EMPLOYED WITH SYSCON ATTEMPT TO INFLUENCE THE SELECTION, NOR
DID HE PARTICIPATE IN THE PREPROPOSAL CONFERENCE, SITE VISIT, ORAL
DISCUSSIONS OR NEGOTIATIONS.
WE FIND THAT CSC'S ALLEGATION DOES NOT PROVIDE A BASIS UPON WHICH TO
QUESTION THE AWARD. 18 U.S.C. SEC. 207 DOES IMPOSE CRIMINAL PENALTIES
ON FORMER GOVERNMENT EMPLOYEES WHO REPRESENT ANYONE BUT THE GOVERNMENT
ON SPECIFIC MATTERS IN WHICH THE FORMER EMPLOYEE PARTICIPATED OR OVER
WHICH HE HAD RESPONSIBILITY AS AN EMPLOYEE. THERE IS NO EVIDENCE,
HOWEVER, THAT THE EMPLOYEE REPRESENTED SYRE IN ANY MANNER AND
CONSEQUENTLY WE SEE NO BASIS TO SUGGEST A VIOLATION OF THE STATUTE.
MOREOVER, THE INTERPRETATION AND ENFORCEMENT OF THIS STATUTE IS
GENERALLY THE RESPONSIBILITY OF THE DEPARTMENT OF JUSTICE, NOT THIS
OFFICE. BRAY STUDIOS, INC., B-207723, B-207746, OCTOBER 27, 1982, 82-2
CPD 373.
ADDITIONALLY, THE CLAIMS COURT DECISION CSC CITES WAS RECENTLY
REVERSED ON THE BASIS THAT THE MERE POTENTIAL FOR IMPROPRIETIES IS NOT A
BASIS UPON WHICH TO ENJOIN THE AWARD OF A CONTRACT. CACI, INC.- FEDERAL
V. UNITED STATES, 719 F.2D 1567 (FED.CIR. 1983). SINCE CSC HAS AT BEST
ESTABLISHED NO MORE THAN A MERE POTENTIAL FOR IMPROPRIETIES, WE REJECT
CSC'S CONTENTION. SEE IONICS INCORPORATED, B-211180, MARCH 13, 1984,
84-1 CPD .
WE DENY THE PROTEST.
B-210799, B-210799.2, MAR 8, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. ALLEGATION THAT FIRM IS NOT A QUALIFIED MINORITY BUSINESS UNDER
THE DISTRICT OF CLOUMBIA MINORITY CONTRACTING ACT (ACT) IS FOR
CONSIDERATION BY THE DISTRICT OF COLUMBIA UNDER PROVISIONS OF THE ACT.
2. CONTENTION THAT A BID PRICE IS BELOW COST OR A "BUY IN" BID DOES
NOT PROVIDE A VALID BASIS TO CHALLENGE AN AWARD TO A BIDDER THAT IS
DETERMINED RESPONSIBLE, AND SUCH A FINDING IS REQUIRED PRIOR TO AN
AWARD.
ALL WEATHER CONTRACTORS, INC.; BRADLEY TRUCKING COMPANY:
ALL WEATHER CONTRACTORS, INC. (AWCI), AND BRADLEY TRUCKING COMPANY
PROTEST THE PROPOSED AWARD OF A CONTRACT TO HARDY AND SONS (H&S), THE
LOW BIDDER UNDER SOLICITATION NO. 0028-AA-23-0-3-MR, ISSUED BY THE
DISTRICT OF COLUMBIA (D. C.). BOTH PROTESTERS ALLEGE THAT H&S IS NOT A
REGISTERED OR OTHERWISE ELIGIBLE MINORITY BUSINESS ENTERPRISE UNDER D.
C. LAW AND, THUS, IS NOT ELIGIBLE FOR AWARD UNDER THIS PROCUREMENT,
WHICH IS DESIGNATED FOR A SHELTERED MARKET, THAT IS, A PROCUREMENT
LIMITED TO MINORITY BIDDERS CERTIFIED PURSUANT TO THE D. C. MINORITY
CONTRACTING ACT OF 1977 (ACT), AS AMENDED, D. C. CODE SECS. 1-1141
THROUGH 1-1151, 1-1104, 1-1107 AND 1-1110 (1982). AWCI ALSO ALLEGES
THAT H&S'S BID IS NONRESPONSIVE BECAUSE ITS PRICE FOR TWO ITEMS
SOLICITED IS UNREALISTIC AND ITS OVERALL BID PRICE IS TOO LOW WHEN
COMPARED TO OTHER BIDDERS.
WE DISMISS THE PROTESTS.
REGARDING H&S'S STATUS AS A MINORITY BUSINESS ELIGIBLE FOR AWARD
UNDER THIS SHELTERED MARKET PROCUREMENT, WE HAVE STATED THAT THE PROPER
FORUM FOR THE RESOLUTION OF THIS MATTER IS THE DISTRICT'S MINORITY
BUSINESS OPPORTUNITY COMMISSION (COMMISSION), NOT GAO. SECTION 9(E) OF
THE ACT ALLOWS ANY PERSON TO PREFER CHARGES OF A VIOLATION OF THE ACT TO
THE COMMISSION AGAINST ANY APPLICANT FOR REGISTRATION OR CONTRACTOR
ALREADY REGISTERED. THE SECTION PROVIDES FOR AN EXPEDITED HEARING BY
THE COMMISSION ON THE CHARGES AND FOR REVOCATION OF THE REGISTRATION, OR
OTHER ACTION, AS DETERMINED PROPER. THUS, THIS ISSUE IS NOT FOR OUR
CONSIDERATION. S&N TRUCKING COMPANY; CONDOR TRANSPORTATION COMPANY,
B-197125, B-197125.2, JANUARY 28, 1980, 80-1 CPD 75.
AWCI ALSO ALLEGES THAT H&S'S BID PRICE ON TWO ITEMS IS UNREALISTIC
AND ITS TOTAL BID PRICE IS TOO LOW AND, THUS, RENDERS THE BID
NONRESPONSIVE. THE FACT THAT A BID MAY BE BELOW COST OR CONSTITUTES A
"BUY-IN" DOES NOT PROVIDE A VALID BASIS TO CHALLENGE AN AWARD TO A FIRM
THAT IS DETERMINED RESPONSIBLE, AND SUCH A DETERMINATION MUST BE MADE
BEFORE ANY CONTRACT AWARD. 48 FED.REG. 1932 (1983) (TO BE CODIFIED 4
C.F.R. SEC. 21.3(G)(4)); TOMBS & SONS, INC., B-206810.2, MAY 10, 1982,
82-1 CPD 447; BIOSPHERICS, INC. - RECONSIDERATION, B-203419.4, MARCH
16, 1982, 82-1 CPD 246.
WE DISMISS THE PROTESTS.
B-210798, APR 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. ALLEGATION OF ANTI-TRUST VIOLATIONS IS FOR CONSIDERATION BY THE
ATTORNEY GENERAL, NOT GAO.
2. THE POSSIBILITY OF A BUY-IN DOES NOT FURNISH A GROUND ON WHICH TO
PROTEST A CONTRACT AWARD.
3. A CONTRACT AWARD NECESSARILY INCLUDES A FINDING BY THE
CONTRACTING OFFICER THAT THE AWARDEE IS RESPONSIBLE. GAO WILL NOT
REVIEW AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY ABSENT A SHOWING
OF FRAUD OR AN ALLEGATION THAT DEFINITIVE RESPONSIBILITY CRITERIA WERE
MISAPPLIED.
4. PROTEST THAT SOLICITATION DID NOT CONTAIN A NECESSARY ENCLOSURE
GOES TO AN IMPROPRIETY IN THE SOLICITATION. GAO THEREFORE WILL NOT
CONSIDER SUCH A PROTEST UNLESS IT IS FILED BEFORE THE CLOSING DATE FOR
RECEIPT OF INITIAL PROPOSALS.
B.H.AIRCRAFT COMPANY, INC.:
B.H.AIRCRAFT COMPANY, INC. PROTESTS THE AWARD OF A CONTRACT TO N.V.
PHILIPS UNDER SOLICITATION F41608-82-R-7254 ISSUED BY THE DEPARTMENT OF
THE AIR FORCE FOR ENGINE SPARE PARTS. B.H.AIRCRAFT CLAIMS THAT THE
AWARD TO N.V.PHILIPS WAS IMPROPER BECAUSE OF ALLEGED ANTITRUST
VIOLATIONS, THE POSSIBILITY OF A BUY-IN, AND THE AIR FORCE'S FAILURE TO
FOLLOW THE REGULATIONS WHICH GOVERN HOW OFFEROR RESPONSIBILITY SHOULD BE
DETERMINED. B.H.AIRCRAFT ALSO COMPLAINS THAT THE AIR FORCE DID NOT
ATTACH A REQUIRED ENCLOSURE TO THE SOLICITATION.
WE DISMISS THE PROTEST.
B.H.AIRCRAFT FIRST ALLEGES THAT N.V.PHILIPS AND ANOTHER SUPPLIER OF
ENGINE SPARE PARTS ARE VIOLATING THE ANTI-TRUST LAWS. CONSIDERATION OF
ALLEGED ANTI-TRUST VIOLATIONS, HOWEVER, IS FOR THE ATTORNEY GENERAL, NOT
OUR OFFICE. MCQUISTON ASSOCIATES, B-199013, SEPTEMBER 1, 1981, 81-2 CPD
192. WE THEREFORE DISMISS THIS GROUND OF PROTEST.
B.H.AIRCRAFT NEXT SUGGESTS THAT N.V.PHILIPS' OFFER REFLECTS AN
ATTEMPT AT "BUYING IN" IN THAT IT ALLEGEDLY IS A BELOW-COST OFFER IN
VIOLATION OF DEFENSE ACQUISTION REGULATION (DAR) SEC. 1-311 (1976 ED.).
THE POSSIBILITY OF A BUY-IN, HOWEVER, IS NOT A PROPER BASIS UPON
WHICH TO CHALLENGE A CONTRACT AWARD, SINCE THERE IS NOTHING INHERENTLY
ILLEGAL ABOUT A BUY-IN. SWISS-TEX INCORPORATED, B-200809, B-200810,
OCTOBER 31, 1980, 80-2 CPD 333. INDEED, DAR SEC. 1-311 DOES NOT
PROHIBIT AWARD BASED ON A BELOW-COST OFFER, BUT ONLY CAUTIONS THAT WHERE
THERE IS REASON TO BELIEVE THAT A RESPONSIBLE FIRM HAS "BOUGHT-IN" THE
CONTRACTING OFFICER SHOULD ASSURE THAT AMOUNTS THE CONTRACTOR EXCLUDED
IN DEVELOPING ITS PRICE ARE NOT RECOVERED IN THE PRICING OF CHANGE
ORDERS OR OTHERWISE. SEE TOMBS & SONS, INC., B-206810.2, MAY 10, 1982,
82-1 CPD 447. THE PROTEST ON THIS ISSUE IS DISMISED.
THE THIRD GROUND OF B.H.AIRCRAFT'S PROTEST IS THAT THE AIR FORCE
VIOLATED DAR SEC. 1-905.3 BY FAILING TO REQUEST STATUS REPORTS REGARDING
INVESTIGATIONS OF N.V.PHILIPS AND THE OTHER SUPPLIER WHICH WERE BEING
CONDUCTED BY THE DEFENSE AUDIT SERVICE AND THE JUSTICE DEPARTMENT AT THE
TIME THE CONTRACT WAS AWARDED. THE REGULATION LISTS SOURCES, SUCH AS
"GOVERNMENT DEPARTMENTS AND AGENCIES," FROM WHICH INFORMATION CONCERNING
AN OFFEROR SHOULD BE OBTAINED IN CONNECTION WITH DETERMINING WHETHER THE
FIRM IS RESPONSIBLE, THAT IS, CAPABLE OF PERFORMING THE CONTRACT.
THE AWARD OF A FEDERAL CONTRACT NECESSARILY INCLUDES A FINDING THAT
THE AWARDEE IS RESPONSIBLE. DAR SEC. 1-902; WARFIELD & SANFORD, INC.,
B-206929, APRIL 20, 1982, 82-1 CPD 365. THIS OFFICE WILL NOT REVIEW A
CONTRACTING OFFICER'S DETERMINATION THAT A PROSPECTIVE CONTRACTOR IS
RESPONSIBLE UNLESS THE SOLICITATION CONTAINS DEFINITIVE RESPONSIBILITY
CRITERIA WHICH ALLEGEDLY HAVE NOT BEEN APPLIED OR THERE IS AN ALLEGATION
OF FRAUD OR BAD FAITH ON THE PART OF CONTRACTING OFFICIALS. KENILWORTH
TRASH COMPANY, B-207314, MAY 18, 1982, 82-1 CPD 480. SINCE NEITHER
EXCEPTION APPLIES HERE, WE WILL NOT CONSIDER THE PROTESTER'S COMPLAINT
ABOUT THE SCOPE OF THE CONTRACTING OFFICER'S RESPONSIBILITY
INVESTIGATION.
FINALLY, B.H.AIRCRAFT COMPLAINS THAT THE SOLICITATION DID NOT CONTAIN
AN ENCLOSURE REFERENCED IN THE SOLICITATON AS ATTACHED. THIS
ALLEGATION, HOWEVER, RELATES TO A SOLICITATION IMPROPRIETY WHICH WAS
APPARENT BEFORE THE CLOSING DATE FOR THE RECEIPT OF INITIAL PROPOSALS,
AND A PROTEST ON SUCH A GROUND MUST BE FILED BEFORE THAT DATE. 4 C.F.
R. SEC. 21.2(B)(1) (1982). SINCE THIS PROTEST WAS NOT FILED UNTIL AFTER
AN AWARD HAD BEEN MADE, IT IS UNTIMELY.
THE PROTEST IS DISMISSED.
B-210796, AUG 29, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST AGAINST AGENCY'S DETERMINATION TO RETAIN
FUNCTION IN-HOUSE BASED ON A-76 COST COMPARISON
WITH BIDS RECEIVED IN RESPONSE TO IFB IS DENIED
WHERE ERRORS MADE BY THE AGENCY IN COMPUTING ITS
IN-HOUSE COST ESTIMATE, IF VIEWED IN THEIR WORST
LIGHT, DO NOT IMPACT THE EVALUATION RESULT.
CONTRACT SERVICES COMPANY, INC.:
CONTRACT SERVICES COMPANY, INC. (CSC), PROTESTS THE NAVAL COASTAL
SYSTEMS CENTER, PANAMA CITY, FLORIDA (NAVY), CANCELLATION OF INVITATION
FOR BIDS (IFB) N62467-82-B-2843 AND ITS DECISION TO CONTINUE IN-HOUSE
PERFORMANCE OF THE TRANSPORTATION, OPERATION AND MAINTENANCE
REQUIREMENTS COVERED BY THE SOLICITATION.
WE DENY THE PROTEST.
THE IFB, ISSUED AUGUST 7, 1982, STATED THAT "SERVICES WILL BE
PROVIDED UNDER GUIDELINES SET FORTH IN OFFICE OF MANAGEMENT AND BUDGET
(OMB) CIRCULAR A-76." THREE BIDS WERE RECEIVED. ON SEPTEMBER 23, 1982,
BIDS WERE OPENED WITH CSC BEING THE APPARENT LOW BIDDER WITH AN ADJUSTED
COST OF CONTRACTING-OUT OF $1,381,426 VERSUS THE ADJUSTED ESTIMATED COST
OF IN-HOUSE PERFORMANCE OF $1,400,404, FOR THE CONTRACT PERIOD OF 1 YEAR
PLUS 2 OPTION YEARS.
SUBSEQUENT TO BID OPENING, BUT PRIOR TO THE END OF THE 10-WORKING-DAY
PUBLIC REVIEW PERIOD, THE NAVY CONDUCTED AN EXTENSIVE REVIEW OF THE COST
COMPARISON DOCUMENTS AND REVISED ITS COST COMPARISON FORMS.
CONTEMPORANEOUSLY, TWO INTERESTED PARTIES FILED TIMELY APPEALS WITH THE
NAVY IDENTIFYING AREAS OF THE COST STUDY SUPPORTING THE REVISIONS MADE
BY THE GOVERNMENT. THE REVISIONS INDICATED THAT IN-HOUSE PERFORMANCE
WOULD BE $136,070 LESS COSTLY THAN THE COST OF CONTRACTING-OUT.
CSC TIMELY FILED AN ADMINISTRATIVE APPEAL OF THE NAVY'S DETERMINATION
TO CONTINUE IN-HOUSE PERFORMANCE. IN BOTH ITS INITIAL AND FINAL REVIEW,
THE NAVY DENIED CSC'S APPEAL. CSC SUBSEQUENTLY FILED A TIMELY PROTEST
WITH GAO. CSC CONTENDS THAT: (1) THE NAVY'S POST-BID-OPENING DECISION
TO REVISE ITS COST STUDY WAS IMPROPER BECAUSE THE REVISION WAS NOT BASED
ON AN APPEAL BY AN INTERESTED PARTY; AND (2) THE COST STUDY CONTAINED
INACCURATE CALCULATIONS IN VIOLATION OF THE NAVY'S COST COMPARISON
HANDBOOK (CCH) AND OMITTED CERTAIN COSTS REQUIRED TO BE INCLUDED IN THE
IN-HOUSE COST ESTIMATE.
INITIALLY, WE POINT OUT, WITH REGARD TO A PROTEST INVOLVING A DISPUTE
OVER AN AGENCY DECISION TO PERFORM WORK IN-HOUSE RATHER THAN TO CONTRACT
OUT THE SERVICES, WE WILL ONLY CONSIDER ALLEGATIONS OF A FAULTY OR
MISLEADING COST COMPARISON. MIDLAND MAINTENANCE, INC., B-202977.2,
FEBRUARY 22, 1982, 82-1 CPD 150; D-K ASSOCIATES, B-201503, B-201625,
SEPTEMBER 10, 1981, 81-2 CPD 208. IN THE COURSE OF OUR REVIEW, WE WILL
QUESTION ONLY WHETHER MANDATED PROCEDURES WERE FOLLOWED AND NOT THE
PROCEDURES THEMSELVES, SINCE THE PROCEDURES ARE MATTERS OF POLICY WITHIN
THE PROVINCE OF THE EXECUTIVE BRANCH. D-K ASSOCIATES, SUPRA.
CSC'S CONTENTION THAT THE NAVY IMPROPERLY DECIDED TO REVISE ITS COST
STUDY BECAUSE THE REVISION WAS NOT BASED ON AN APPEAL BY AN INTERESTED
PARTY IS WITHOUT MERIT. IN ADDITION TO THE NAVY, TWO INTERESTED
PARTIES, THE NATIONAL FEDERATION OF FEDERAL EMPLOYEES AND A NAVY
EMPLOYEE WHO WOULD POTENTIALLY BE AFFECTED BY THE DETERMINATION MADE IN
THIS CASE, IDENTIFIED AREAS IN THE ORIGINAL COST STUDY BELIEVED NOT TO
BE IN COMPLIANCE WITH THE COST COMPARISON GUIDELINES ESTABLISHED IN THE
DEPARTMENT OF DEFENSE (DOD) AND OMB CCH, AND RELATED REGULATIONS. SINCE
BOTH THE DOD AND OMB CCH (AT PAGE 9, PARAGRAPH 9) LIST "BIDDERS,
AFFECTED EMPLOYEES, AND UNIONS REPRESENTING AFFECTED EMPLOYEES" AS
INTERESTED PARTIES, THE DECISION TO REVISE THE COST ESTIMATE CANNOT BE
SAID TO HAVE BEEN MADE WITHOUT AN APPEAL BY AN INTERESTED PARTY. IN
ADDITION, WE FIND NOTHING IN THE OMB OR DOD CCH OR THE APPLICABLE
REGULATIONS WHICH WOULD PRECLUDE THE NAVY FROM REVISING ITS COST
ESTIMATE IF IT DETERMINES, IN GOOD FAITH, THAT ITS ESTIMATE WAS
ORIGINALLY IN NONCONFORMANCE WITH THE CCH GUIDELINES, APPLICABLE
REGULATIONS, OR SOLICITATION PROVISIONS.
CSC ARGUES THAT THE NAVY SHOULD NOT BE PERMITTED TO REDUCE THE
IN-HOUSE ESTIMATE BY A SUM OF $11,040 REFLECTING A DECREASE IN THE LABOR
RATE ESCALATION FACTOR FROM 5.1 PERCENT TO 4 PERCENT. WE DISAGREE. A
NAVY DIRECTIVE (CNO WASHINGTON, D. C., MSG 092109Z APR. 82), IN EFFECT
PRIOR TO AND DURING THE ISSUANCE OF THE SOLICITATION, REQUIRED THAT:
"IF, AFTER BID OPENING, IT APPEARS LIKELY THAT
APPLICATION OF LATEST INFLATION INDICES MIGHT
MATERIALLY AFFECT OUTCOME OF COST COMPARISON,
MAJOR CLAIMANT IS TO REVIEW COST COMPARISON AND,
IF WARRANTED, DIRECT RECALCULATION USING INFLATION
INDICES IN EFFECT AT BID OPENING."
BECAUSE THE INFLATION INDICES WERE DIFFERENT AT BID OPENING THAN WHEN
THE COST ESTIMATE WAS CALCULATED, THE NAVY ACTED PROPERLY IN ADJUSTING
ITS COST ESTIMATE.
CSC OBJECTS TO AN ADJUSTMENT OF $22,907 MADE TO THE PROJECTED COST OF
MATERIALS RESULTING FROM AMENDMENT 0004 (AUGUST 9, 1982), WHICH LIMITED
CONTRACTOR LIABILITY FOR VEHICLE REPAIRS TO $2,000 PER YEAR IN EXCESS OF
A MAXIMUM ONE-TIME REPAIR COST. DUE TO THE AMENDMENT, THE COST OVER AND
ABOVE THE CONTRACTOR'S LIABILITY FOR MATERIALS, ESTIMATED BY THE NAVY
FROM HISTORICAL REPAIR COSTS, WOULD BE BORNE BY THE GOVERNMENT WHETHER
THE FUNCTION IS CONTRACTED OUT OR REMAINS IN-HOUSE. FOR THIS REASON,
THAT PORTION OF THE ESTIMATED COST (I.E., $22,907, INCLUDING AN
ADJUSTMENT FOR INFLATION REFERENCED TO FY 1981 DOLLARS) SHOULD BE
CONSIDERED A "WASH ITEM" AND DELETED FROM THE MATERIAL COST LINE, IN
ACCORDANCE WITH THE IFB, AMENDMENT 0004, PARAGRAPH 5.10 (EXCESSIVE
REPAIRS) AND OMB CIRCULAR A-76 TRANSMITTAL MEMORANDUM NO. 6, SECTION
2.6, JANUARY 26, 1982. CSC STATES THAT THE DATA USED FOR THE REDUCTION
WAS NOT MADE AVAILABLE TO CSC FOR ITS CONSIDERATION AND, THEREFORE,
VIOLATES BOTH THE LETTER AND INTENT OF OMB CIRCULAR A-76. IN CONTRAST,
THE AGENCY STATES THAT "ALL RAW DATA USED FOR DETERMINING FY 1981
MATERIAL COSTS WAS AVAILABLE TO ANY INTERESTED BIDDER AND ALL BIDDERS
WERE ADVISED OF THIS." WHERE, AS HERE, CONFLICT EXISTS BETWEEN THE
PROTESTER AND THE AGENCY ON A DISPUTED QUESTION OF FACT AND THE ONLY
EVIDENCE BEFORE GAO CONSISTS OF CONTRADICTORY ASSERTIONS, THE PROTESTER
HAS NOT CARRIED ITS BURDEN OF AFFIRMATIVELY PROVING ITS ALLEGATION.
EAST WIND INDUSTRIES, INC., B-208170, DECEMBER 29, 1982, 82-2 CPD 587.
CSC FURTHER OBJECTS TO THE 3-YEAR TOTAL ADDITION OF $68,670, ADDED
AFTER BID OPENING TO THE NAVY'S ESTIMATE OF CONTRACTING-OUT COSTS, BASED
UPON RETAINED PAY COSTS PROJECTED FROM A MOCK REDUCTION-IN-FORCE (RIF).
THE AGENCY STATES THAT THE FINAL DETERMINATION OF REASONABLE RETAINED
PAY COSTS WAS BASED ON AN ANALYSIS OF THE BEST CASE (LEAST COST) AND
WORST CASE (GREATEST COST) RIF SCENARIOS. THE PROPOSED BEST CASE
ANALYSIS WOULD HAVE ADDED A COST OF $24,462 TO THE CONTRACTORS' BID FOR
RETAINED PAY. THE WORST CASE SCENARIO WOULD HAVE ADDED $157,256 TO THE
CONTRACTORS' BID. UNDER THE CIRCUMSTANCES, WE FIND THE NAVY'S ESTIMATE
OF RETAINED PAY COSTS TO BE REASONABLE AND IN ACCORD WITH THE MANDATES
OF OMB CIRCULAR A-76, TRANSMITTAL MEMORANDUM NO. 6, ATTACHMENT "A," PART
"C," JANUARY 26, 1982, WHICH MERELY REQUIRES THAT THE AGENCY PERFORMING
THE COST STUDY "ESTIMATE THE RETAINED PAY COSTS ASSOCIATED WITH THOSE
PERSONS WHO WOULD BE DOWNGRADED AS A RESULT OF A CONVERSION." THE
PROTESTER HAS NOT MET ITS BURDEN OF PROVING THAT THE NAVY'S ESTIMATES
ARE NOT REASONABLY BASED. SEE G.&B.PACKING COMPANY, INC., B-204192,
APRIL 20, 1982, 82-1 CPD 359.
CSC CONTENDS THAT THE NAVY'S COST STUDY INCORRECTLY OMITTED MATERIAL
OVERHEAD COSTS. CSC CITES OPNAVINST 4860.6C, AT III-14(3)(G), AS
REQUIRING THAT MATERIAL OVERHEAD SHOULD BE ESTIMATED AT 15 PERCENT OF
DIRECT MATERIAL COSTS. THE NAVY CORRECTLY POINTS OUT, HOWEVER, THAT THE
GUIDANCE PRESENTED ON PAGE III-14 IS MERELY THE REVIEW FORMAT FOR
CURRENTLY CONTRACTED-OUT NAVY COST ANALYSIS FUNCTIONS AND IS TO BE USED
ONLY WHEN CONTRACTING-OUT IS UNDERGOING AN ASSESSMENT PRIOR TO CONTRACT
RENEWAL AND A REVIEW PRIOR TO RESOLICITATION. FACTORS SUCH AS MATERIAL
OVERHEAD ARE ESTIMATED AT 15 PERCENT OF DIRECT MATERIAL COSTS ON THE
FORM AS A SIMPLIFIED PROCEDURE FOR CONTRACT REVIEW AND ARE NOT USED
UNDER A FULL COST STUDY.
THE NAVY STATES THAT IT ESTIMATED THAT THERE WOULD BE NO MATERIAL
OVERHEAD COSTS BECAUSE NO WHOLE MAN-YEARS WERE IDENTIFIED FOR THE SUPPLY
OF DIRECT MATERIAL AND THE ABOVE-NOTED NAVY DIRECTIVE DID NOT REQUIRE
INCLUSION LESS THAN WHOLE MAN-YEARS IN THE ESTIMATE OF MATERIAL OVERHEAD
COSTS. WE FIND THAT THE NAVY CORRECTLY FOLLOWED THE CCH GUIDELINES OF
OMB TRANSMITTAL MEMORANDUM NO. 6, PARAGRAPH 2.B., AMENDING THE CCH
PARAGRAPH 9.A.(3) TO STATE: " *** COSTS THAT WOULD BE THE SAME FOR
EITHER IN-HOUSE OR CONTRACT OPERATION NEED NOT BE INCLUDED IN THE COST
COMPARISON."
SINCE NO WHOLE MAN-YEARS WERE IDENTIFIED UNDER THE AREA OF MATERIAL
OVERHEAD, THERE WOULD BE NO MATERIAL OVERHEAD SAVINGS REALIZED BY THE
GOVERNMENT DUE TO CONTRACTING-OUT. WE CONCLUDE THAT THE NAVY PROPERLY
ANALYZED ITS MATERIAL OVERHEAD COSTS.
CSC POINTS OUT THAT THE NAVY HAS ALLOCATED ZERO GENERAL AND
ADMINISTRATIVE (G&A) EXPENSES TO THE PERFORMANCE OF THE CONTRACT,
WHEREAS OPNAVINST 4860.6C AT III-14(3)(H) REQUIRES THAT G&A EXPENSES BE
CALCULATED AT 10 PERCENT OF THE COSTS OF DIRECT LABOR AND FRINGE
BENEFITS.
WE FIND THAT THE 10-PERCENT FIGURE FOUND IN OPNAVINST 4860.6C IS TO
BE USED ONLY AS AN ESTIMATE FOR REVIEW PURPOSES, AND WE ALSO CONCLUDE
THAT THE NAVY DID NOT ERR IN FAILING TO INCLUDE ANY G&A EXPENSES IN ITS
COST ESTIMATE. IN JUSTIFYING ITS OMISSION OF G&A EXPENSES, THE NAVY
CITES ITS DIRECTIVE, WHICH STATES THAT IN CALCULATING THEIR ESTIMATES,
PROCURING ACTIVITIES ARE TO "COST ONLY WHOLE MAN-YEARS OF EFFORT NEEDED
TO SUPPORT ACTIVITY UNDER STUDY. PARTIAL MAN-YEARS ARE EXCLUDED BECAUSE
THEY WOULD CONTINUE TO EXIST FOR EITHER IN-HOUSE OR CONTRACT
PERFORMANCE." THE AGENCY ARGUES THAT "A REDUCTION OF ONLY 12 POSITIONS
OUT OF ABOUT 600 TOTAL IN THE NCSC WORKFORCE WOULD NOT UNDER THE
GUIDELINES OF THE AFOREMENTIONED DIRECTIVE GENERATE ANY G&A SAVINGS."
THEREFORE, THE NAVY ALLOCATED NO G&A TO THE PERFORMANCE OF THE IFB
REQUIREMENTS. WE CONCLUDE THAT THE NAVY CORRECTLY FOLLOWED THE
GUIDELINES OF OMB TRANSMITTAL MEMORANDUM, QUOTED ABOVE.
CSC ARGUES THAT THE NAVY'S FAILURE TO INCLUDE A FIGURE UNDER LINE 6
OF THE COST STUDY ("OTHER DIRECT COSTS") RENDERS THE COMPARISON UNFAIR
AND INACCURATE. WE DISAGREE. OPNAVINST 4860.6C AT IV - 28 H.2. GIVES
EXAMPLES OF "OTHER DIRECT COSTS" BY STATING THAT THEY "MAY INCLUDE
SPECIAL TRAVEL EXPENSES, PRINTING SERVICES, SHOP SUPPLIES, AND
UTILITIES." THE NAVY STATES THAT WHILE ADDRESSING POSSIBLE OMISSIONS TO
THE "OTHER DIRECT COST" LINE, FOUR ITEMS WERE FOUND WHICH MIGHT HAVE
BEEN PRESENTED ON THIS LINE: VEHICLE MUFFLER REPAIR, TRANSPORTATION OF
THINGS, MISCELLANEOUS OTHER COSTS, AND INSTRUMENTATION CHANGES. THE
NAVY STATES THAT THESE COSTS WERE NOT IGNORED, BUT INSTEAD WERE INCLUDED
UNDER LINE ONE, "MATERIAL COSTS." WE AGREE WITH THE NAVY'S COMMENT THAT
"COMPUTATION OF THESE COSTS RESULTS IN THE SAME TOTAL REGARDLESS OF
WHERE IT WAS DECIDED TO PLACE THEM." EVEN IF THERE WAS AN ERROR IN
PLACEMENT OF THE ITEM, IT DOES NOT IMPACT THE EVALUATION RESULT. SEE
DYNETERIA, INC., B-205487, JUNE 1, 1982, 82-1 CPD 506.
CSC CONTENDS THAT THE NAVY FAILED TO INCLUDE ADEQUATE COSTS FOR ITS
OPERATIONS OVERHEAD IN ITS COST STUDY, INCLUDING, FOR EXAMPLE, THE COSTS
OF INSURANCE, SALARIES AND FRINGE BENEFITS OF SUPERVISORS AND
ADMINISTRATIVE PERSONNEL, VACATIONS, SICK LEAVE, TRAINING TIME,
MAINTENANCE AND REPAIR OF GOVERNMENT EQUIPMENT, AND SUPPORT COSTS FOR
WORK DONE OFF BASE.
THE NAVY HAS STATED THAT IT TREATED INSURANCE AS A "WASH ITEM"
BECAUSE THE GOVERNMENT IS SELF-INSURED AND CONTINUES TO BE "LARGELY
RESPONSIBLE" FOR CASUALTY INSURANCE ON FACILITIES AND EQUIPMENT IF THE
FUNCTIONS ARE CONTRACTED BUT PERFORMED ON GOVERNMENT PROPERTY. EVEN IF
THE NAVY WERE "FULLY RESPONSIBLE" FOR CASUALTY INSURANCE (WHICH IT IS
NOT), THE NAVY ERRED BY FAILING TO INCLUDE AN ESTIMATE FOR LIABILITY
LOSSES, THEREBY VIOLATING THE MANDATES OF OMB AND DOD CCH AT P. 35.
HOWEVER, THE ERROR, CALCULATED TO BE LESS THAN $1,000, IS NEGLIGIBLE IN
VIEW OF THE FACT THAT THE GOVERNMENT'S ESTIMATE INDICATED THAT IN-HOUSE
PERFORMANCE WOULD BE $136,700 LESS COSTLY THAN THE COST OF
CONTRACTING-OUT. SEE DYNETERIA, INC., SUPRA.
THE NAVY STATES THAT IT DID NOT COST OPERATIONS OVERHEAD POSITIONS
AND RELATED FRINGE BENEFITS, VACATIONS, SICK LEAVE, AND TRAINING COSTS
BECAUSE IT CONCLUDED THAT THE WORKLOAD REQUIRED "SIGNIFICANTLY LESS THAN
ONE MANYEAR OF EFFORT" AND THAT THE NAVY DIRECTIVE STATES THAT ONLY
WHOLE MAN-YEARS OF SUPPORT FROM THE SUPERVISORY WORK CENTER SHOULD BE
COSTED. IN LINE WITH OUR ANALYSIS OF THE NAVY'S HANDLING OF ITS G&
ACOSTS, WE CONCLUDE THAT THE NAVY DID NOT ERR BY NOT ALLOCATING
OPERATIONS OVERHEAD COSTS TO THIS STUDY.
CSC CLAIMS THAT THE GOVERNMENT'S ESTIMATES OF ITS FRINGE BENEFITS
COSTS HAVE BEEN CALCULATED INCORRECTLY. WE AGREE. WHILE THE NAVY HAS
USED THE STANDARD FIGURE OF 26 PERCENT OF DIRECT LABOR COSTS AS
SUGGESTED BY THE CCH TO FIGURE STANDARD FRINGE BENEFITS, IT HAS NOT
COMPUTED THE FIGURE ACCURATELY. THE NAVY LISTS $309,159 AS ITS DIRECT
LABOR COSTS. TWENTY-SIX PERCENT OF THIS FIGURE YIELDS A BASE FRINGE
BENEFIT FIGURE OF $80,381 VERSUS THE $75,341 COMPUTED BY THE NAVY. THIS
$5,040 YEARLY ERROR AMOUNTS TO A TOTAL ERROR OF $15,120 OVER THE 3-YEAR
CONTRACTING PERIOD. THIS ERROR IS FOUND, HOWEVER, TO HAVE NO IMPACT ON
THE DETERMINATION TO CONTINUE IN-HOUSE PERFORMANCE. SEE DYNETERIA,
INC., SUPRA.
CSC CONTENDS THAT THE NAVY FAILED TO INCLUDE THE COST OF DEPRECIATION
OF EQUIPMENT AND TOOLS UNDER THE IFB WHICH WERE NOT BEING SUPPLIED AS
GOVERNMENT-FURNISHED EQUIPMENT (GFE). THE NAVY STATES THAT NON-GFE
REQUIRED UNDER THE SOLICITATION COSTS LESS THAN $1,000 AND WAS COSTED
UNDER LINE 1 (DIRECT MATERIAL) OF THE COST COMPARISON, WHICH NEED BE
NEITHER CAPITALIZED NOR DEPRECIATED. CSC HAS NOT MET ITS BURDEN OF
PROVING ERROR IN THIS INSTANCE. SEE EAST WIND INDUSTRIES, INC., SUPRA.
CSC CONTENDS THAT THE NAVY'S FAILURE TO INCLUDE COSTS FOR DIRECT
LABOR PAY ESCALATION IN THE SECOND AND THIRD YEARS OF THE CONTRACT
CONFLICTS WITH OUR DECISION IN SERV-AIR, INC.; AVCO, 60 COMP.GEN. 44
(1980), 80-2 CPD 317, WHERE WE FOUND THAT AN AIR FORCE ESTIMATE DID NOT
REFLECT THE ACTUAL COST OF PERFORMING THE FUNCTION IN-HOUSE BECAUSE IT
STRAIGHT-LINED PERSONNEL COSTS FOR THE SECOND AND THIRD YEAR OF THE
CONTRACT, WHEREAS THE OFFEROR ESCALATED SECOND AND THIRD YEAR PERSONNEL
COSTS. WE AGREE IN PART WITH CSC.
THE NAVY POINTS OUT THAT SINCE THE SOLICITATION CONTAINS THE "FAIR
LABOR STANDARDS ACT AND SERVICE CONTRACT ACT" PRICE ADJUSTMENT CLAUSE,
CONTRACTOR WAGE INCREASES RESULTING FROM REVISED DEPARTMENT OF LABOR
WAGE RATES ARE EXPECTED TO BE BORNE BY THE GOVERNMENT IN THE FORM OF
CONTRACT PRICE INCREASES. BECAUSE OF THIS, THE NAVY ARGUES THESE COSTS
SHOULD BE TREATED AS "WASH ITEMS" AND THE NAVY SHOULD NOT HAVE TO
CALCULATE DIRECT LABOR PAY ESCALATION INTO ITS ESTIMATE. IN SERV-AIR,
SUPRA, WE REJECTED AN ARGUMENT SIMILAR TO THE NAVY'S BY STATING THAT THE
"FAIR LABOR STANDARDS ACT AND SERVICE CONTRACT ACT" CLAUSE:
"*** ONLY PROVIDES FOR CONTRACT PRICE
ADJUSTMENTS IF THE CONTRACTOR IS COMPELLED TO
INCREASE EMPLOYEES' WAGES TO COMPLY WITH A
CHANGE MANDATED BY THE DEPARTMENT OF LABOR.
THUS, IF A CONTRACTOR IS ALREADY PAYING ITS
EMPLOYEES MORE THAN THE MINIMUM WAGE WHEN AN
INCREASE IN THE MINIMUM WAGE BECOMES OPERATIVE,
THERE WILL BE NO CONTRACT PRICE ADJUSTMENT
UNLESS THE NEW WAGE EXCEEDS THE ONE BEING PAID.
FURTHER, OFFERORS CERTAINLY MAY PLAN TO INCREASE
PROPOSED PERSONNEL COSTS IN YEARS TWO AND THREE
BASED ON BUSINESS JUDGMENT INDEPENDENT OF THE
MINIMUM WAGE."
THE NAVY STATES THAT OUR SERV-AIR DECISION IS INAPPLICABLE HERE DUE
TO GUIDANCE PROVIDED BY CNO WASHINGTON D. C., MSG 141917Z, MAY 82, WHICH
IS THE SAME AS OMB CIRCULAR A-76 TRANSMITTAL MEMORANDUM NO. 6,
ATTACHMENT "A," PART "A," WHICH READS:
"IN CASES WHERE A CONTRACT FOR THE NEEDED
PRODUCT OR SERVICES WOULD INCLUDE SOME FORM OF
ECONOMIC ADJUSTMENT CLAUSE FOR SUBSEQUENT
YEARS, NO ALLOWANCE FOR INFLATION OF THOSE
COSTS PROTECTED BY THE ADJUSTMENT CLAUSE IS
INCLUDED IN OUT-YEAR CONTRACT PRICING, AND
CORRESPONDING COSTS OF GOVERNMENT PERFORMANCE
SHOULD NOT BE INFLATED. FOR EXAMPLE, CONTRACTS
SUBJECT TO THE SERVICE CONTRACT ACT INCLUDE A
CLAUSE THAT PROVIDES FOR ADJUSTMENTS TO
ACCOMMODATE LABOR COST INCREASES NECESSITATED
BY FUTURE MINIMUM WAGE DETERMINATIONS. ACCORDINGLY,
WHEN CONTRACT PERFORMANCE WOULD BE UNDER
A CONTRACT SUBJECT TO THE SERVICE CONTRACT ACT,
LABOR COSTS FOR GOVERNMENT EMPLOYEES IN OCCUPATIONS
THAT WOULD BE INCLUDED IN THE ACT SHOULD
BE DEDUCTED FROM THE BASE FOR INFLATION CALCULATIONS."
AS EMPHASIZED ABOVE, ONLY LABOR COSTS FOR CONTRACT EMPLOYEES IN
OCCUPATIONS THAT ARE COVERED BY THE SERVICE CONTRACT ACT AND TO THE
EXTENT COVERED BY THE ACT NEED NOT BE INCLUDED IN THE BASE FOR INFLATION
CALCULATIONS. FOR EXAMPLE, SINCE THE SERVICE CONTRACT ACT OF 1965
SPECIFICALLY EXEMPTS EXECUTIVE, ADMINISTRATIVE AND PROFESSIONAL
EMPLOYEES, 41 U.S.C. SEC. 357(B) (1976); SERV-AIR, INC.; AVCO - AIR
FORCE REQUEST FOR RECONSIDERATION, B-195183.3, NOVEMBER 3, 1981, 81-2
CPD 375, LABOR COSTS FOR SUCH EMPLOYEES SHOULD HAVE BEEN INCLUDED IN THE
INFLATION CALCULATIONS. HOWEVER, EVEN IF AN INFLATION CALCULATION WOULD
BE BASED ON THE PRESUMPTION THAT ALL OF THE CONTRACT EMPLOYEES WOULD BE
EXEMPT FROM THE SERVICE CONTRACT ACT AND THAT THE GOVERNMENT SHOULD
ESCALATE ALL OF ITS DIRECT LABOR COSTS, THE CORRESPONDING INCREASE IN
THE GOVERNMENT'S ESTIMATE, $37,717.40 ($309,159 (0.04 + 0.082)) FN1
WOULD NOT IMPACT ON THE EVALUATION RESULT, WHERE, AS HERE, THE
GOVERNMENT'S ESTIMATE INDICATED THAT IN-HOUSE PERFORMANCE WOULD BE
$136,700 LESS COSTLY THAN THE COST OF CONTRACTING-OUT. SEE DYNETERIA,
INC., SUPRA.
CONCLUSION
SINCE THE NAVY'S ERRORS, VIEWED IN THE WORST POSSIBLE LIGHT, AMOUNT
TO LESS THAN HALF OF THE $136,700 DIFFERENCE BETWEEN THE ESTIMATED COST
OF IN-HOUSE PERFORMANCE AND THE COST OF CONTRACTING-OUT, CORRECTION OF
THE ERRORS WOULD HAVE NO IMPACT ON THE EVALUATION RESULT. DYNETERIA,
INC., SUPRA.
THE PROTEST IS DENIED.
FN1 $309,159 = TOTAL ESTIMATED DIRECT LABOR COSTS PER YEAR; 0.04 =
SECOND YEAR INFLATION COEFFICIENT; 0.082 = THIRD YEAR INFLATION
COEFFICIENT; SEE OMB CCH PAGE 50.
B-210794, APR 5, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST AGAINST AWARD UNDER PURCHASE ORDER IS RENDERED ACADEMIC BY
AGENCY'S SUBSEQUENT CANCELLATION OF THE PURCHASE ORDER.
STACOR CORPORATION:
STACOR CORPORATION PROTESTS THE AWARD OF A CONTRACT BY THE VETERANS
ADMINISTRATION (VA) TO THE SPACESAVER GROUP (SPACESAVER) UNDER PURCHASE
ORDER NO. 652/A3G046. STACOR CONTENDS SPACESAVER DID NOT COMPLY WITH
THE SPECIFICATIONS, OFFERED IMPROPER DISCOUNTS, AND OFFERED SHELVING
ITEMS NOT CURRENTLY LISTED IN SPACESAVER'S GENERAL SERVICES
ADMINISTRATION (GSA) CONTRACT.
THE VA HAS PROVIDED US WITH AN AMENDMENT TO THE PURCHASE ORDER WHICH
INDICATES THAT THE ORDER WAS CANCELED ON FEBRUARY 23, 1983, BECAUSE NONE
OF THE SHELVING SPECIFIED IN THE ORDER IS ON GSA CONTRACT. THE
AMENDMENT INDICATES THAT BIDS FOR THE SHELVING REQUIREMENT WILL BE
SOLICITED IN AN OPEN MARKET PURCHASE.
CANCELLATION OF THE PURCHASE ORDER RENDERS STACOR'S PROTEST ACADEMIC
AND WE THEREFORE WILL NOT CONSIDER THE MATTER. SEE TONE INDUSTRIES,
INC., B-208633, OCTOBER 8, 1982, 82-2 CPD 319.
B-210792, DEC 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROCURING AGENCY NEED NOT FURNISH THE
PROTESTER WITH A COPY OF A REQUEST FOR QUOTATIONS
NEEDED TO RESPOND TO THE AGENCY'S
COMMERCE BUSINESS DAILY SYNOPSIS OF ITS
INTENT TO PLACE AN ORDER AGAINST AN
AUTOMATIC DATA PROCESSING SCHEDULE CONTRACT,
WHERE THE PROTESTER CONCEDES THAT IT CAN
SUPPLY ONLY USED EQUIPMENT AND HAS NOT SHOWN
TO BE UNREASONABLE THE AGENCY'S DETERMINATION
THAT ITS MINIMUM NEED IS FOR NEW EQUIPMENT.
ARWELL CORPORATION:
ARWELL CORPORATION HAS PROTESTED THE REFUSAL OF THE ARMY
COMMUNICATIONS-ELECTRONICS COMMAND, FT. MONMOUTH, NEW JERSEY, TO
CONSIDER ARWELL'S ATTEMPTED OFFER OF USED AUTOMATIC DATA PROCESSING
EQUIPMENT IN RESPONSE TO A SYNOPSIS PLACED IN THE COMMERCE BUSINESS
DAILY (CBD). FOR THE REASONS STATED BELOW, THE PROTEST IS DENIED.
FT. MONMOUTH, SEEKING TO ACQUIRE CERTAIN INTERNATIONAL BUSINESS
MACHINES (IBM) AUTOMATIC DATA PROCESSING EQUIPMENT "OR EQUAL, TO INCLUDE
INSTALLATION AND MAINTENANCE," AND ANTICIPATING PLACING AN ORDER UNDER
IBM'S GENERAL SERVICES ADMINISTRATION (GSA) SCHEDULE CONTRACT, FIRST
SYNOPSIZED ITS REQUIREMENT IN THE CBD IN ACCORDANCE WITH FEDERAL
PROCUREMENT REGULATIONS (FPR) SEC. 1-4.1109-6 (1964 ED. AMEND. 211). IN
THE SYNOPSIS, FT. MONMOUTH DESCRIBED THE EQUIPMENT IT WAS ACQUIRING,
ADVISED THAT "ALL ACQUISITION PLANS WILL BE TAKEN INTO CONSIDERATION,"
THAT IT WAS "UTILIZING GSA SCHEDULE" AND THAT INTERESTED FIRMS COULD
REQUEST A COPY OF A REQUEST FOR QUOTATIONS (RFQ) WHICH WAS TO BE
"ISSUED" ON JANUARY 23 WITH A CLOSING DATE OF FEBRUARY 7. WE NOTE THAT
NEITHER THE FPR NOR THE RELEVANT PROVISION IN THE DEFENSE ACQUISITION
REGULATION, SEC. 4-1104.6, SPECIFIES THE MANNER IN WHICH INTERESTED
FIRMS ARE TO RESPOND TO CBD SYNOPSES. HERE, FT. MONMOUTH PREPARED AN
RFQ FOR THIS PURPOSE. DEPENDING UPON THE RESPONSES RECEIVED FROM
POTENTIAL SUPPLIERS, THE CONTRACTING OFFICER IS TO DETERMINE WHETHER IT
WOULD BE MOST ADVANTAGEOUS TO THE GOVERNMENT TO ORDER FROM THE SCHEDULE
OR TO CONDUCT A COMPETITION THROUGH THE ISSUANCE OF A FORMAL
SOLICITATION. FPR SEC. 1-4.1109-6(G)(1).
ARWELL CONTACTED FT. MONMOUTH BY TELEPHONE TO REQUEST A COPY OF THE
RFQ FOR THE PURPOSE OF RESPONDING TO THE CBD SYNOPSIS. IN THE COURSE OF
THIS CONVERSATION, ARWELL WAS ASKED IF IT COULD SUPPLY NEWLY
MANUFACTURED EQUIPMENT AND IT REPLIED THAT IT COULD FURNISH ONLY USED,
REMANUFACTURED EQUIPMENT. FT. MONMOUTH, HOWEVER, HAD DETERMINED THAT
ITS MINIMUM NEED WAS FOR NEW EQUIPMENT, A FACT WHICH DID NOT APPEAR IN
THE CBD SYNOPSIS. SINCE ARWELL CONCEDEDLY COULD NOT SUPPLY IT WITH NEW
EQUIPMENT, FT. MONMOUTH REFUSED TO PROVIDE ARWELL WITH A COPY OF THE
RFQ. THIS PRECIPITATED ARWELL'S PROTEST, IN WHICH IT ARGUES THAT IT
SHOULD BE PROVIDED WITH A COPY OF THE RFQ SO THAT IT MAY RESPOND TO THE
CBD SYNOPSIS BY QUOTING ON USED, REMANUFACTURED EQUIPMENT.
OUR OFFICE HAS CONSISTENTLY HELD THAT THE DETERMINATION OF MINIMUM
NEEDS IS THE RESPONSIBILITY OF THE CONTRACTING AGENCY. THE AGENCY IS IN
THE BEST POSITION TO ASCERTAIN ITS NEEDS DUE TO FAMILIARITY WITH
PARTICULAR REQUIREMENTS AND ENVIRONMENTS IN WHICH THE PRODUCTS WILL BE
USED. THUS, OUR OFFICE WILL NOT QUESTION AN AGENCY'S DETERMINATION OF
ITS MINIMUM NEEDS OR THE TECHNICAL JUDGMENT FORMING THE BASIS FOR THAT
DETERMINATION UNLESS IT IS CLEARLY SHOWN TO BE UNREASONABLE. DICTAPHONE
CORPORATION, B-209477, MARCH 1, 1983, 83-1 CPD 214.
FT. MONMOUTH DETERMINED THAT IT REQUIRED NEW EQUIPMENT BECAUSE (1)
SUCH EQUIPMENT IS NECESSARY TO INSURE THAT IT MEETS A CRITICAL MISSION
NEED OF MEETING REQUISITION CYCLE REQUIREMENTS IN ORDER TO PROVIDE
SUPPORT FOR TROOPS IN THE FIELD - A FUNCTION FOR WHICH IT STATES IT MUST
HAVE THE MOST RELIABLE EQUIPMENT POSSIBLE, AND (2) THE EQUIPMENT MUST
HAVE A MINIMUM SYSTEM LIFE OF 8 YEARS AND WITH USED EQUIPMENT - UNLIKE
WITH NEW EQUIPMENT - THERE IS NO WAY OF ACCURATELY DETERMINING THE
SYSTEM LIFE OF THE EQUIPMENT.
ARWELL ARGUES THAT IN THE COMPUTER INDUSTRY IT IS ACCEPTED THAT USED,
REMANUFACTURED IBM EQUIPMENT MEETING CURRENT ENGINEERING CHANGE LEVELS
AND SUBJECT TO IBM MAINTENANCE AGREEMENTS (WHICH ARWELL STATES IT WOULD
PROVIDE) IS EQUAL TO NEW EQUIPMENT. IT SUGGESTS THAT ITS POSITION IS
SUPPORTED BY OUR DECISION INTERNATIONAL BUSINESS MACHINES CORPORATION,
B-198094, B-198094.2, NOVEMBER 18, 1980, 80-2 CPD 363.
ARWELL HAS NOT SPECIFICALLY ADDRESSED THE ARMY'S ARGUMENT THAT ITS
MISSION NEEDS IN THIS INSTANCE REQUIRE A DEGREE OF RELIABILITY AND
ASSURANCE OF SYSTEM LIFE WHICH CAN BE MET ONLY BY NEW EQUIPMENT. IN
ADDITION, OUR PRIOR IBM CASE WHICH BOTH THE ARMY AND ARWELL HAVE
DISCUSSED DOES NOT RECOGNIZE, AS ARWELL APPEARS TO SUGGEST, THAT
REMANUFACTURED AND NEW EQUIPMENT ARE NECESSARILY EQUAL. IN THAT CASE,
THE GENERAL SERVICES ADMINISTRATION WAS ACQUIRING NEW EQUIPMENT TO BE
USED AT A NAVAL AIR TESTING FACILITY. IBM, WISHING TO OFFER
REMANUFACTURED EQUIPMENT, OBJECTED TO THE SPECIFICATION REQUIREMENT THAT
THE EQUIPMENT BE "NEW," MAKING MUCH THE SAME ARGUMENT AS ARWELL DOES
HERE. AFTER CONSIDERING THE CRITICALITY OF THE NAVY'S NEED FOR
EQUIPMENT WHICH WOULD OPERATE RELIABILITY OVER THE 8-YEAR SYSTEM LIFE,
WE CONCLUDED THAT IBM HAD NOT SHOWN THE NAVY TO HAVE BEEN ARBITRARY IN
REQUIRING NEW EQUIPMENT AND THAT THEREFORE THE "NEW EQUIPMENT" PROVISION
OF THE SOLICITATION WAS NOT UNDULY RESTRICTIVE OF COMPETITION.
SIMILARLY, IN THE INSTANT CASE ARWELL HAS NOT SHOWN THAT THE ARMY'S
REQUIREMENT THAT THE EQUIPMENT BE NEW WAS UNREASONABLE. WE DO NOT,
THEREFORE, FIND THE REQUIREMENT TO BE IMPROPER. SINCE ARWELL CONCEDES
THAT IT CANNOT SATISFY THE ARMY'S REQUIREMENT FOR NEW EQUIPMENT, IT DOES
NOT APPEAR THAT ARWELL COULD PROVIDE AN ACCEPTABLE RESPONSE TO THE CBD
SYNOPSIS EVEN WERE IT TO BE PROVIDED WITH A COPY OF THE RFQ.
THE PROTEST IS DENIED.
B-210789, JUL 6, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
THE RETIRED PAY OF A MEMBER WHO WAS CHIEF MASTER SERGEANT OF THE AIR
FORCE PRIOR TO ENTERING TERMINAL LEAVE STATUS, AT WHICH TIME HIS STATUS
REVERTED TO CHIEF MASTER SERGEANT, AND WHO RETIRED UNDER 10 U.S.C. SEC.
8917 EFFECTIVE NOVEMBER 1, 1981, MAY BE COMPUTED BASED ON THE SPECIAL
RATE FOR CHIEF MASTER SERGEANT OF THE AIR FORCE IN EFFECT PRIOR TO HIS
COMMENCING TERMINAL LEAVE OR ON THE BASIS OF THE GRADE IN WHICH HE WAS
SERVING AT THE TIME OF HIS RETIREMENT AS A CHIEF MASTER SERGEANT.
CHIEF MASTER SERGEANT JAMES M. MCCOY, USAF (RETIRED):
THE QUESTION FOR CONSIDERATION IS WHETHER A FORMER CHIEF MASTER
SERGEANT OF THE AIR FORCE IS ENTITLED TO COMPUTE HIS RETIRED PAY ON THE
BASIS OF THE RATE OF PAY FOR THAT POSITION AT THE TIME OF HIS RETIREMENT
WHICH FOLLOWED A PERIOD OF TERMINAL LEAVE DURING WHICH ANOTHER MEMBER
HAD BEEN APPOINTED TO THE POSITION OF CHIEF MASTER SERGEANT OF THE AIR
FORCE. HIS RETIRED PAY MAY BE COMPUTED ON THE BASIS OF THE SPECIAL RATE
OF PAY HE RECEIVED WHILE OCCUPYING THAT POSITION OR ON THE RATE OF PAY
HE WAS RECEIVING AT THE TIME OF HIS RETIREMENT AS A CHIEF MASTER
SERGEANT (E-9).
THE QUESTION AS PRESENTED BY AN ACCOUNTING AND FINANCE OFFICER,
HEADQUARTERS, AIR FORCE ACCOUNTING AND FINANCE CENTER. THE REQUEST WAS
FORWARDED TO THIS OFFICE BY LETTER FROM HEADQUARTERS UNITED STATES AIR
FORCE, AND HAS BEEN ASSIGNED AIR FORCE SUBMISSION NO. DO-AF-1414 BY THE
DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE.
THE POSITION OF CHIEF MASTER SERGEANT OF THE AIR FORCE IS ESTABLISHED
UNDER AIR FORCE REGULATION 39-2 WHICH PROVIDES THAT THE MEMBER WHO IS TO
OCCUPY THIS POSITION WILL BE SELECTED FROM THE ENLISTED MEMBERS OF THE
AIR FORCE UNDER CRITERIA ESTABLISHED BY THE CHIEF OF STAFF, AND THAT THE
TENURE OF THE MEMBER IS AT THE DISCRETION OF THE CHIEF OF STAFF.
ADDITIONALLY, WHILE THE MEMBER IS SERVING IN THE POSITION HE IS ENTITLED
TO A SPECIAL RATE OF PAY AS SET PURSUANT TO 37 U.S.C. SECS. 203 AND
1009. THE REGULATION ALSO PROVIDES THAT MEMBERS WHO CONTINUE ON ACTIVE
DUTY AFTER THEY COMPLETE THE TOUR OF DUTY AS CHIEF MASTER SERGEANT OF
THE AIR FORCE REVERT TO THE GRADE OF CHIEF MASTER SERGEANT (PAY GRADE
E-9), UNTIL RETIREMENT. ON RETIREMENT THEY WILL BE ADVANCED TO CHIEF
MASTER SERGEANT OF THE AIR FORCE (SPECIAL PAY GRADE) FOR THE PURPOSE OF
RETIREMENT.
JAMES M. MCCOY WAS CHIEF MASTER SERGEANT OF THE AIR FORCE BETWEEN
AUGUST 1, 1979, AND JULY 31, 1981. DURING THE PERIOD AUGUST 1 THROUGH
OCTOBER 31, 1981, THE DATE OF HIS RETIREMENT, SERGEANT MCCOY WAS ON
TERMINAL LEAVE. WHILE IN THE TERMINAL LEAVE STATUS, THE MEMBER'S PAY
REVERTED TO THE RATE FOR A CHIEF MASTER SERGEANT (E-9) WITH OVER 26
YEARS SERVICE FOR LONGEVITY PURPOSES. WE HAVE BEEN INFORMALLY ADVISED
THAT ON AUGUST 1, 1981, A NEW CHIEF MASTER SERGEANT OF THE AIR FORCE WAS
APPOINTED AND ASSUMED THE DUTIES OF THAT POSITION.
A QUESTION HAS ARISEN WHETHER SERGEANT MCCOY'S INITIAL RETIRED PAY
SHOULD BE COMPUTED BASED UPON THE OCTOBER 1, 1981 SPECIAL PAY RATE FOR
CHIEF MASTER SERGEANT OF THE AIR FORCE, WHICH WAS A HIGHER RATE THAN THE
RATE APPLICABLE PRIOR TO THAT DATE WHILE SERGEANT MCCOY WAS SERVING IN
THAT POSITION. THE AIR FORCE'S VIEW IS THAT HIS RETIRED PAY MAY NOT BE
COMPUTED USING THE OCTOBER 1, 1981 SPECIAL PAY RATE SINCE HE WAS NOT
SERVING IN THAT POSITION ON THAT DATE.
UNDER THE PROVISIONS OF 37 U.S.C. SECS. 203 AND 1009, A MEMBER IS
ENTITLED TO A SPECIAL RATE OF PAY WHILE SERVING AS THE CHIEF MASTER
SERGEANT OF THE AIR FORCE. THIS SPECIAL PAY RATE IS SET OUT IN THE
EXECUTIVE ORDER PRESCRIBING PAY ADJUSTMENTS PURSUANT TO 37 U.S.C. SEC.
1009. WHEN CHIEF MASTER SERGEANT MCCOY WENT ON TERMINAL LEAVE HE WAS NO
LONGER SERVING IN THE POSITION AND HIS PAY WAS COMPUTED AS AN E-9 WITH
OVER 26 YEARS. AIR FORCE MANUAL 177-373, VOLUME III, PARAGRAPH 1-28(
4)(B), PROVIDES THAT TERMINAL LEAVE SHOULD ONLY BE GRANTED UNDER CERTAIN
CONDITIONS, AMONG WHICH ARE THAT THE MEMBER HAS COPIES OF HIS RETIREMENT
OR SEPARATION ORDERS AND HAS COMPLETED ALL PROCESSING AND THAT THE
MEMBER AGREE NOT TO RETURN TO THE UNIT AFTER LEAVE BEGINS. THUS, IT
SEEMS CLEAR THAT SERGEANT MCCOY WAS NO LONGER SERVING IN THE POSITION OF
CHIEF MASTER SERGEANT OF THE AIR FORCE ONCE HE COMMENCED TERMINAL LEAVE.
ADDITIONALLY, ONLY ONE ENLISTED MEMBER OF THE AIR FORCE MAY SERVE AS
CHIEF MASTER SERGEANT OF THE AIR FORCE. A NEW CHIEF MASTER SERGEANT OF
THE AIR FORCE ASSUMED THAT POSITION ON AUGUST 1, 1981, THEREBY
PRECLUDING ANY CLAIM BY SERGEANT MCCOY TO THE SPECIAL RATE OF PAY FOR
THE POSITION AFTER AUGUST 1, 1981.
SECTION 8991 OF TITLE 10, FOOTNOTE 3, PROVIDES THAT AN ENLISTED
MEMBER OF THE AIR FORCE WHO HAS SERVED AS CHIEF MASTER SERGEANT OF THE
AIR FORCE MAY COMPUTE HIS RETIRED PAY ON THE BASIS OF HIGHEST RATE OF
PAY APPLICABLE TO HIM WHILE HE SO SERVED, IF THAT RATE IS HIGHER THAN
THE RATE OTHERWISE APPLICABLE. THAT IS, THE HIGHEST RATE OF PAY
APPLICABLE TO HIM WHILE HE OCCUPIED THE POSITION MAY BE USED IN THE
COMPUTATION OF HIS RETIRED PAY IF IT IS HIGHER THAN THE RATE OTHERWISE
APPLICABLE. SEE 47 COMP.GEN. 696 (1968) ANSWER TO QUESTION D, INVOLVING
A SIMILAR PROVISION APPLICABLE TO SENIOR COMMISSIONED OFFICERS.
ACCORDINGLY, SINCE SERGEANT MCCOY WAS NOT SERVING IN THE POSITION OF
CHIEF MASTER SERGEANT OF THE AIR FORCE ON OCTOBER 1, 1981, NOR ON THE
DATE OF RETIREMENT, NOVEMBER 1, 1981, HE IS NOT ENTITLED TO COMPUTE HIS
INITIAL RETIRED PAY ON THE BASIS OF THE RATE OF PAY OF THAT POSITION
WHICH WENT INTO EFFECT ON OCTOBER 1, 1981. THE VOUCHER WILL BE RETAINED
HERE.
B-210782, APR 13, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
A BID ACCOMPANIED BY A MATERIALLY ALTERED BID BOND - WHERE THE PENAL
AMOUNT HAS BEEN TYPED OVER A WHITE-OUT WITHOUT EVIDENCE IN THE BID
DOCUMENTS OR ON THE BOND ITSELF OF THE SURETY'S CONSENT TO BE BOUND BY
THE CHANGES - IS NONRESPONSIVE.
MONTGOMERY ELEVATOR CO.:
MONTGOMERY ELEVATOR CO. PROTESTS THE AIR FORCE'S REJECTION OF ITS BID
UNDER INVITATION FOR BIDS NO. F41800-83-B-0009. THE AIR FORCE REJECTED
THE BID AS NONRESPONSIVE BECAUSE MONTGOMERY SUBMITTED A BID BOND WHICH
HAD BEEN ALTERED WITHOUT ANY INDICATION OF CONSENT TO THE CHANGE BY THE
SURETY. WE SUMMARILY DENY THE PROTEST.
THE INVITATION - TO ACQUIRE THE REPAIR, ALTERATION AND MAINTENANCE OF
PASSENGER ELEVATORS - REQUIRED A BID BOND OR OTHER SECURITY IN THE FORM
OF 20 PERCENT OF THE BID PRICE OR $3,000,000, WHICHEVER IS LESS. THE
PENAL AMOUNT COULD BE EXPRESSED EITHER AS A PERCENTAGE OF THE BID PRICE
OR IN DOLLARS AND CENTS. THE BOND SUBMITTED BY MONTGOMERY STATED THAT
THE PENAL SUM WAS 20 PERCENT OF THE BID PRICE NOT TO EXCEED A
TYPEWRITTEN PENAL AMOUNT OF $280,681.00, IN WHICH THE "80" (THE THIRD
AND FOURTH NUMERALS TO THE LEFT OF THE DECIMAL POINT) HAD BEEN TYPED
OVER A WHITED-OUT AREA. THERE WAS NOTHING IN THE BID DOCUMENTS OR THE
BOND ITSELF TO INDICATE THE SURETY, AMERICAN INSURANCE COMPANY, HAD
AGREED TO THE CORRECTED AMOUNT.
ACCORDING TO MONTGOMERY, THE TWO DIGITS WERE ALTERED TO REFLECT A
LAST-MINUTE CHANGE IN A SUBCONTRACTOR'S QUOTATION THAT CHANGED THE BID
AMOUNT, AND THE ALTERATION MERELY MADE THE PENAL AMOUNT 20 PERCENT OF
THE NEW PRICE. MONTGOMERY EXPLAINS THAT THE PERSON WHO SIGNED THE BOND
AS THE SURETY'S ATTORNEY-IN-FACT IS A MONTGOMERY EMPLOYEE AUTHORIZED BY
THE SURETY TO EXECUTE BONDS WITHOUT ADVANCE NOTICE TO THE SURETY.
MONTGOMERY ASSERTS THIS EMPLOYEE COULD HAVE EXECUTED A NEW BID BOND
FORM, BUT CHANGING THE TWO DIGITS WAS FASTER THAN RETYPING THE FORM.
AN INVITATION'S REQUIREMENT FOR THE SUBMISSION OF A BID BOND INVOLVES
A MATTER OF RESPONSIVENESS WITH WHICH THERE MUST BE COMPLIANCE AT BID
OPENING AND NOT LATER. THE REASON, IN PART, IS THAT IF THE SITUATION
WERE OTHERWISE, A BIDDER WHO FAILED TO SUBMIT A VALID BOND COULD DECIDE
AFTER BID OPENING WHETHER OR NOT TO CAUSE ITS BID TO BE REJECTED BY
SUBMITTING OR REFUSING TO SUBMIT THE BOND. SEE 38 COMP. GEN. 532
(1959).
THE SUBMISSION OF A MATERIALLY ALTERED BOND CAN HAVE THE SAME EFFECT
AS THE FAILURE TO SUBMIT A BOND ALTOGETHER, BECAUSE UNDER SURETY LAW NO
ONE INCURS A LIABILITY TO PAY A DEBT OR TO PERFORM A DUTY FOR ANOTHER
UNLESS EXPRESSLY AGREEING TO BE BOUND. AN ALTERATION IN THE BOND THUS
RAISES A QUESTION WHETHER THE SURETY AGREED TO THE ALTERED TERMS. SEE
44 COMP.GEN. 495 (1965). A MATERIAL ALTERATION TO A BOND, SUCH AS IN
THE PENAL AMOUNT, MADE WITHOUT THE SURETY'S CONSENT DISCHARGES THE
SURETY FROM LIABILITY, 3A C.J.S. ALTERATION OF INSTRUMENTS SEC. 46
(1973), AND A MATERIAL ALTERATION THUS NECESSARILY RAISES A QUESTION
WHETHER THE SURETY HAS ANY OBLIGATION UNDER THE BOND.
IN VIEW OF THOSE CONSIDERATIONS, IN A SIMILAR CASE INVOLVING AN
ALTERED PENAL AMOUNT WITHOUT EVIDENCE IN THE BID OR IN THE BOND THAT THE
SURETY AGREED TO THE ALTERED BOND'S TERMS, WE HELD THAT THE BID WAS
NONRESPONSIVE. BAUCOM JANITORIAL SERVICE, INC., B-206353, APRIL 19,
1982, 82-1 CPD 356. ALTHOUGH THE BIDDER SUBMITTED AN AFFIDAVIT FROM THE
SURETY STATING THAT THE ALTERATIONS TOOK PLACE WITH THE SURETY'S PRE-BID
OPENING CONSENT, THE AFFIDAVIT DID NOT CURE THE BIDDING DEFECT BECAUSE
THE NONRESPONSIVE BID COULD BE MADE RESPONSIVE AFTER BID OPENING THROUGH
CHANGE OR EXPLANATION OF WHAT WAS INTENDED.
MONTGOMERY ARGUES THAT OUR BAUCOM DECISION IS BAD LAW. MONTGOMERY
BASICALLY ATTEMPTS TO DRAW A DISTINCTION BETWEEN CASES WHERE A BIDDER
FAILS TO SUBMIT A BOND OR SUBMITS ONE THAT IS INVALID ON ITS FACE, AND
CASES WHERE THE BIDDER SUBMITS A BOND THAT IS VALID ON ITS FACE BUT
RAISES A SUSPICION THAT THE SURETY IS IN A POSITION TO DISAVOW THE BOND.
WHILE IN THE FIRST CASE THE BIDDER WOULD HAVE TO TAKE SOME ACTION TO
OBTAIN A VALID BOND, IN THE SECOND CASE THE BOND ITSELF, MONTGOMERY
ARGUES, IS VALID UNLESS DISAVOWED BY THE SURETY, AND THE ISSUE OF
WHETHER THE SURETY AGREED TO THE TERMS OF THE BOND SIMPLY IS A QUESTION
OF FACT. MONTGOMERY SUGGESTS THAT TO RESOLVE THE FACTUAL QUESTION THE
CONTRACTING OFFICER NEED ONLY CONTACT THE SURETY AND ASK IF THE APPARENT
ALTERATIONS HAD BEEN APPROVED IN ADVANCE.
MONTGOMERY ALSO ARGUES THAT THE ALTERED AMOUNT IS NOT MATERIAL SINCE
THE BOND STILL STATES THAT THE PENAL AMOUNT IS 20 PERCENT OF THE BID
PRICE. MONTGOMERY CONTENDS THAT THE DOLLAR AMOUNT THUS IS NO MORE THAN
A MECHANICAL COMPUTATION OF THE PERCENTAGE. FINALLY, MONTGOMERY ALLEGES
THAT THE AWARDEE'S BID BOND ALSO CONTAINED A WHITED-OUT AREA AND
SUGGESTS THAT IF MONTGOMERY'S BID MUST BE REJECTED, THEN THE AWARDEE'S
BID SHOULD HAVE BEEN REJECTED ALSO.
WE FIND NO LEGAL MERIT TO THE PROTESTER'S POSITION.
THE PROTESTER'S ARGUMENT WOULD PERMIT THE CIRCUMVENTION OF THE
PRINCIPLE THAT A BIDDER SHOULD NOT BE ABLE TO DETERMINE AFTER BID
OPENING WHETHER TO HAVE ITS BID REJECTED BY EITHER SUBMITTING OR
REFUSING TO SUBMIT A VALID BOND. AS THIS CASE POINTEDLY SHOWS, A
BIDDER'S OWN EMPLOYEE MAY HAVE A POWER-OF-ATTORNEY TO EXECUTE BONDS ON
BEHALF OF THE SURETY OR MAY BE IN A POSITION TO INFLUENCE THE SURETY'S
DECISION WHETHER OR NOT TO DISAVOW AN ALTERED BOND.
THE PURPOSE OF A BOND IS TO SECURE THE LIABILITY OF A SURETY TO THE
GOVERNMENT IN ACCORDANCE WITH THE TERMS OF THE BOND, SO THAT THE
QUESTION PRESENTED IN CASES WHERE BONDS DO NOT COMPLY WITH INVITATION
REQUIREMENTS IS WHETHER THE GOVERNMENT OBTAINS THE SAME PROTECTION IN
ALL MATERIAL RESPECTS UNDER THE BOND ACTUALLY SUBMITTED AS IT WOULD
UNDER A BOND COMPLYING WITH THE REQUIREMENT. SEE GENERAL SHIP AND
ENGINE WORKS, INC., 55 COMP.GEN. 422 (1975), 75-2 CPD 269. AS STATED
ABOVE, A SURETY IS DISCHARGED FROM LIABILITY ON A BOND IF A MATERIAL
TERM OF THE BOND WAS ALTERED WITHOUT ITS CONSENT, AND AN ALTERED BOND,
WITHOUT CONTEMPORANEOUSLY-FURNISHED EVIDENCE THAT THE SURETY AGREED TO
THE ALTERED TERMS, SIMPLY DOES NOT AFFORD THE GOVERNMENT THE DESIRED
PROTECTION. THE BURDEN ON THE BIDDER TO SUBMIT EVIDENCE OF AGREEMENT,
OR TO PREPARE A NEW BOND, IS SLIGHT, AND IS NOT ENOUGH TO JUSTIFY
ENDORSING A SITUATION WITH THE POTENTIAL FOR BIDDERS TO SUBMIT ALTERED
BONDS AND THEN DETERMINE AFTER BID OPENING WHETHER TO HAVE THEIR BIDS
REJECTED.
CONCERNING THE MATERIALITY OF THE ALTERATION TO MONTGOMERY'S BOND, WE
NOTE THAT THE SURETY COULD HAVE EXPRESSED THE PENAL AMOUNT MERELY AS A
PERCENTAGE OF THE BID PRICE WITHOUT RENDERING MONTGOMERY'S BID
NONRESPONSIVE. SEE SOUTHERN PLATE GLASS CO., B-188872, AUGUST 22, 1977,
77-2 CPD 135. THE FACT IS THAT THE SURETY DID NOT DO SO, BUT INSTEAD
STIPULATED A SPECIFIC AMOUNT BEYOND WHICH IT WOULD NOT ASSUME LIABILITY.
IF THE BID BOND NOTED THE ACTUAL BID PRICE, AND THE ALTERED PENAL
AMOUNT EQUALED 20 PERCENT OF THAT PRICE, THEN WE MIGHT AGREE THE
ALTERATION TO THE PENAL AMOUNT WOULD BE IMMATERIAL. ABSENT A REFERENCE
IN THE BOND TO THE BID PRICE, HOWEVER, THERE IS NO WAY OF KNOWING
WHETHER THE ALTERED FIGURE DOES REPRESENT THE MAXIMUM AMOUNT OF
LIABILITY TO WHICH THE SURETY AGREED, OR WHETHER THE SURETY AGREED ONLY
TO A LESSER LIABILITY, AND THUS IS DISCHARGED FROM ANY LIABILITY BY THE
BIDDER'S UNILATERAL ALTERATION. THEREFORE, WE DO NOT AGREE THAT THE
ALTERATION WAS IMMATERIAL.
IN CONTRAST, THE ALLEGED ALTERATION TO THE AWARDEE'S BOND INVOLVES A
CORRECTION OF TYPOGRAPHICAL ERRORS IN THE SECTION DESCRIBING THE WORK TO
BE PERFORMED. THE BOND APPARENTLY IS PROPER AND UNALTERED IN ALL OTHER
RESPECTS, E.G., IT CORRECTLY IDENTIFIES THE PRINCIPAL AND THE INVITATION
BY NUMBER, AND INCLUDES AN APPROPRIATE PENAL AMOUNT. THE CORRECTION IN
ISSUE IS IMMATERIAL SINCE IT DOES NOT RAISE A QUESTION AS TO THE
OBLIGATION THE SURETY UNDERTOOK. SEE J.W.BATESON COMPANY, INC.,
B-189848, DECEMBER 16, 1977, 77-2 CPD 472.
THE PROTEST IS SUMMARILY DENIED.
B-210781; B-210781.2, AUG 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST THAT AGENCY ACTED UNREASONABLY IN
DETERMINING THAT EMERGENCY DREDGING SERVICES WERE NEEDED AND THAT
ONLY A HOPPER DREDGE COULD PERFORM THE WORK WITHIN THE REQUIRED
TIMEFRAME IS DENIED WHERE THE PROTESTER HAS NOT SHOWN THAT THE
AGENCY'S CONCLUSIONS ARE UNREASONABLE BUT MERELY DISAGREES WITH
THE AGENCY'S BELIEF THAT SUCH DREDGING WAS NEEDED AND THAT FIRM
USING PIPELINE DREDGE COULD NOT PERFORM WITHIN THE REQUIRED
TIMEFRAME.
2. AN AGENCY'S FAILURE TO PREPARE A PROPER
DETERMINATION AND FINDINGS JUSTIFYING SOLE-SOURCE NEGOTIATIONS IS
NOT AN ERROR AFFECTING THE VALIDITY OF A SOLE-SOURCE AWARD WHERE
THE SURROUNDING CIRCUMSTANCES INDICATE THAT THE AWARD WAS
JUSTIFIED.
3. AGENCY PROPERLY CANCELED SOLICITATION AFTER BID
OPENING WHEN IT DETERMINED THAT THE SCOPE OF WORK REQUIRED UNDER A
SOLICITATION FOR DREDGING SERVICES HAD SUBSTANTIALLY CHANGED AS A
RESULT OF THE REMOVAL OF SOME OF THE MATERIAL UNDER A SOLE-SOURCE
CONTRACT, AND DETERMINED THAT A PREVIOUSLY UNAVAILABLE
AGENCY-OWNED DREDGE HAD BECOME AVAILABLE TO PERFORM THE REMAINING
WORK.
4. FAILURE OF CONTRACTING OFFICER TO PREPARE A FORMAL
WRITTEN DETERMINATION JUSTIFYING CANCELLATION IS NOT A BASIS FOR
SUSTAINING A PROTEST WHERE CIRCUMSTANCES NECESSARY TO SUPPORT A
CANCELLATION ARE PRESENT.
TOM SHAW INC.; MERRITT DREDGING COMPANY:
TOM SHAW INC. AND MERRITT DREDGING COMPANY PROTEST THE SOLE-SOURCE
AWARD OF A CONTRACT FOR DREDGING WORK BY THE JACKSONVILLE DISTRICT,
CORPS OF ENGINEERS AND THE CORPS' CANCELLATION OF INVITATION FOR BIDS
(IFB) NO. DACW17-83-B-0008, A SOLICITATION FOR DREDGING WORK TO BE
PERFORMED IN THE SAME GENERAL AREA AS THE WORK PERFORMED UNDER THE
SOLE-SOURCE CONTRACT. THE PROTESTERS CONTEND THAT THE CORPS FAILED TO
ADEQUATELY JUSTIFY THE SOLE-SOURCE AWARD AND THAT IT CANCELED THE
SOLICITATION WITHOUT A COMPELLING REASON TO DO SO. FOR THE REASONS THAT
FOLLOW, WE DENY THE PROTESTS.
THE SOLICITATION SOUGHT BIDS FOR THE EMERGENCY MAINTENANCE DREDGING
OF 467,000 CUBIC YARDS OF SILTY SAND MATERIAL FROM THE ENTRANCE AND
ACCESS CHANNELS OF THE U.S. NAVY TRIDENT BASE, CANAVERAL HARBOR,
FLORIDA. AT THE BID OPENING ON DECEMBER 16, 1982, SHAW WAS THE LOW
BIDDER AND MERRITT WAS SECOND LOW. THE NAVY CONDUCTED A PRE-AWARD
SURVEY OF SHAW, AND BASED ON THIS SURVEY, FOUND SHAW TO BE
NONRESPONSIBLE.
SINCE SHAW IS A SMALL BUSINESS, ON JANUARY 20 THE NAVY REFERRED THE
MATTER OF SHAW'S RESPONSIBILITY TO THE SMALL BUSINESS ADMINISTRATION
(SBA) FOR CONSIDERATION UNDER ITS CERTIFICATE OF COMPETENCY (COC)
PROCEDURE. WHILE THE COC PROCESS WAS PENDING, THE CORPS INITIATED
PRELIMINARY CONTACTS WITH MERRITT, APPARENTLY WITH THE INTENTION TO MAKE
AWARD TO MERRITT IN THE EVENT SHAW'S COC WAS DENIED.
MEANWHILE, ON JANUARY 27, THE NAVY COMPLAINED TO THE CORPS THAT
ADDITIONAL SHOALING HAD OCCURRED IMPEDING ITS SUBMARINES' SAFE PASSAGE
TO THEIR BERTHS AND CREATING AN URGENT SITUATION. THE CORPS CONDUCTED A
SURVEY OF THE SITUATION AND FOUND THAT NEW SHOALING HAD IN FACT OCCURRED
IN THE CHANNEL AREA AND AGREED WITH THE NAVY THAT A CRITICAL SITUATION
EXISTED BECAUSE THE NEW SHOALING (WHICH HAD REPORTEDLY INCREASED THE
TOTAL AMOUNT OF MATERIAL TO BE DREDGED TO 691,000 CUBIC YARDS) HAD
REDUCED THE DEPTH AND INHIBITED THE MANEUVERABILITY OF THE TRIDENT
SUBMARINES WITHIN THE CHANNEL. THUS, ON FEBRUARY 1, THE CORPS EXECUTED
A SOLE-SOURCE LETTER CONTRACT WITH NORTH AMERICAN TRAILING COMPANY
(NATCO) - THE FOURTH LOW BIDDER UNDER THE ORIGINAL SOLICITATION -
REQUIRING IT TO DREDGE 240,000 CUBIC YARDS OF MATERIAL WITHIN 40 DAYS OF
THE AWARD DATE. THE CORPS JUSTIFIES ITS AWARD TO NATCO BECAUSE THAT
FIRM HAD THE ONLY AVAILABLE HOPPER DREDGE FN1 AT THE TIME.
ON FEBRUARY 9, THE SBA'S CHICAGO REGIONAL OFFICE NOTIFIED THE CORPS
THAT ITS STAFF HAD RECOMMENDED ISSUING A COC TO SHAW; HOWEVER, SINCE
THE CONTRACT VALUE EXCEEDED $500,000, IT WAS NECESSARY TO OBTAIN THE
CONCURRENCE OF THE SBA'S CENTRAL OFFICE. BY LETTER OF THAT SAME DAY TO
THE SBA, THE CORPS REQUESTED THAT THE COC PROCESS BE TERMINATED BECAUSE
IT HAD DECIDED TO CANCEL THE SOLICITATION. SUBSEQUENTLY, BY LETTER OF
FEBRUARY 10 TO THE BIDDERS, THE CONTRACTING OFFICER CANCELED THE
SOLICITATION PRIMARILY BECAUSE THE INCREASED SHOALING AND THE EMERGENCY
DREDGING RESULTED IN "MAJOR CHANGES IN SCOPE OF WORK" AND THE CORPS
HOPPER DREDGE, WHICH HAD BEEN UNDER REPAIR BECAUSE OF A FIRE, WOULD BE
AVAILABLE TO PERFORM THE REMAINDER OF THE WORK.
ESSENTIALLY, THE PROTESTERS FIRST QUESTION WHETHER THERE WAS ANY NEED
FOR THE EMERGENCY DREDGING AND WHETHER THE CORPS' RESTRICTION OF THAT
WORK TO HOPPER DREDGES EXCEEDED THE CORPS' MINIMUM NEEDS. THEY ARGUE
THAT THE CORPS HAS SUPPLIED NO WEATHER INFORMATION SUPPORTING ITS CLAIM
THAT STORMS CAUSED THE SHOALING BUILD UP AND NO ENGINEERING DATA,
SOUNDINGS OR CHARTS TO VERIFY THE EXISTENCE OF THE ALLEGED ADDITIONAL
SHOALING. THEY FURTHER ARGUE THAT IF INDEED ANY SHOALING BUILDUP
EXISTED, A PIPELINE DREDGE WHICH THEY COULD PROVIDE WOULD MEET THE
CORPS' REQUIREMENT FOR RAPID SHOAL REMOVAL.
THE CONTRACTING AGENCY HAS THE PRIMARY RESPONSIBILITY FOR DETERMINING
ITS MINIMUM NEEDS AND FOR DRAFTING REQUIREMENTS THAT REFLECT THOSE
NEEDS. DYNALECTRON CORPORATION, B-198679, AUGUST 11, 1981, 81-2 CPD
115. THE CONTRACTING AGENCY, WHICH IS MOST FAMILIAR WITH THE CONDITIONS
UNDER WHICH THE SUPPLIES OR SERVICES HAVE BEEN AND WILL BE USED, IS
USUALLY IN THE BEST POSITION TO KNOW THE GOVERNMENT'S ACTUAL MINIMUM
NEEDS. MAGNACO INDUSTRIES, B-206191, OCTOBER 15, 1982, 82-2 CPD 338.
GENERALLY, WHEN A REQUIREMENT HAS BEEN CHALLENGED AS UNDULY RESTRICTIVE
OF COMPETITION, IT IS INCUMBENT UPON THE PROCURING AGENCY TO ESTABLISH
SUPPORT FOR ITS CONTENTION THAT THE RESTRICTION IT HAS IMPOSED IS
REASONABLY RELATED TO ITS NEEDS. ONCE THE AGENCY ESTABLISHES THIS
SUPPORT, THE BURDEN IS ON THE PROTESTER TO SHOW THAT THE REQUIREMENT
COMPLAINED OF IS CLEARLY UNREASONABLE. S.A.F.E. EXPORT CORPORATION,
B-207655, NOVEMBER 16, 1982, 82-2 CPD 445.
THE CORPS REPORTS THAT ITS SURVEY INDICATED THAT SHOALING HAD
OCCURRED THROUGHOUT THE CHANNEL, BUT THAT IN FOUR AREAS INSIDE THE
CHANNEL SHOALING BUILT UP TO SUCH AN EXTENT THAT TRIDENT SUBMARINES WERE
NOT ABLE TO PASS SAFELY FROM THEIR BERTHS TO THE OPEN SEA. THE CORPS
INDICATED THAT IT BELIEVED THAT THIS SHOALING BUILDUP WAS DUE TO "RECENT
SEVERE NORTHEASTERS." WHILE IT MAY BE TRUE, AS THE PROTESTERS POINT OUT,
THAT THE AGENCY HAS NOT PROVIDED BACK UP DATA TO SUPPORT ITS POSITION
THAT THE SHOALING IN FACT EXISTED OR WAS DUE TO THE WEATHER, THE
PROTESTERS HAVE BEEN UNABLE TO SHOW THAT THE INCREASED SHOALING DID NOT
IN FACT EXIST. WHETHER OR NOT STORMS CAUSED THE BUILDUP IS NOT
SIGNIFICANT. IN THE ABSENCE OF ANY EVIDENCE CONTRADICTING THE OPINION
OF THE CORPS, AND REPORTEDLY OF THE TRIDENT BASE COMMANDER, THAT
INCREASED SHOALING CONDITIONS WERE HAMPERING BASE OPERATIONS, WE HAVE NO
BASIS TO QUESTION THE JUDGMENT OF THE CORPS THAT EMERGENCY DREDGING WAS
NEEDED.
REGARDING THE NEED FOR A HOPPER DREDGE, THE CORPS STATES THAT IT
REQUIRED THAT TYPE DREDGE BECAUSE A PIPELINE DREDGE COULD NOT PERFORM
THE CRITICAL WORK WITHIN THE REQUIRED 40 DAYS. THIS WAS DUE, THE CORPS
STATES, TO THE LENGTH OF TIME IT WOULD TAKE FOR A FIRM SUPPLYING A
PIPELINE DREDGE TO REACH THE DREDGING SITE, SET UP ITS PIPELINE, AND
REPAIR THE EXISTING DIKES AND WEIRS FOR THE DISPOSAL SITE. WHILE
MERRITT DISAGREES WITH THE CORPS' POSITION AND CONTENDS THAT IT COULD
HAVE PERFORMED WITHIN 40 DAYS, THAT FIRM HAS NOT PRESENTED EVIDENCE TO
SHOW THAT THE CORPS' POSITION IS UNREASONABLE. UNDER THESE
CIRCUMSTANCES, WE ALSO HAVE NO BASIS TO QUESTION THE CORPS' JUDGMENT
THAT IT NEEDED A HOPPER DREDGE TO PERFORM THE DREDGE WITHIN THE REQUIRED
TIME.
TURNING TO THE PROPRIETY OF CONDUCTING THIS PROCUREMENT ON A
SOLE-SOURCE BASIS, WE NOTE THAT NEGOTIATED PROCUREMENTS MUST BE
CONDUCTED ON A COMPETITIVE BASIS TO THE MAXIMUM PRACTICABLE EXTENT. 10
U.S.C. SEC. 2304(G) (1976); DEFENSE ACQUISITION REGULATION (DAR) SEC.
3-101(D). NONCOMPETITIVE (SOLE-SOURCE) ACQUISITIONS MAY BE AUTHORIZED,
HOWEVER, WHEN THE WORK OR SUPPLIES REQUIRED CAN BE FURNISHED BY ONLY ONE
SOURCE. THERE MAY BE ONLY ONE SOURCE FOR ANY OF SEVERAL REASONS -
BECAUSE THE ITEMS OR SERVICES NEEDED ARE UNIQUE; TIME IS OF THE ESSENCE
AND ONLY ONE SOURCE CAN MEET THE GOVERNMENT'S NEEDS WITHIN THE AVAILABLE
TIME; DATA THAT WOULD BE NEEDED TO PERMIT A COMPETITIVE PROCUREMENT IS
UNAVAILABLE AND CANNOT BE OBTAINED WITHIN THE TIME AVAILABLE; OR ONLY A
SINGLE SOURCE CAN PROVIDE AN ITEM THAT MUST BE COMPATIBLE OR
INTERCHANGEABLE WITH EXISTING EQUIPMENT. ROLM CORPORATION AND FISK
TELEPHONE SYSTEMS, INC., B-202031, AUGUST 26, 1981, 81-2 CPD 180. WHILE
WE SUBJECT SOLE-SOURCE PROCUREMENTS TO CLOSE SCRUTINY, R&E CABLEVISION,
B-199592, FEBRUARY 19, 1981, 81-1 CPD 110, WE WILL NOT OBJECT TO SUCH AN
ACQUISITION IF THERE IS A REASONABLE BASIS FOR IT. WINSLOW ASSOCIATES,
53 COMP.GEN. 478 (1974), 74-1 CPD 14.
HERE, PRIOR TO AWARDING THE SOLE-SOURCE CONTRACT THE CORPS PREPARED A
DETERMINATION AND FINDINGS (D&F) ENTITLED "AUTHORITY TO NEGOTIATE AN
INDIVIDUAL CONTRACT" THAT JUSTIFIED NEGOTIATION FOR THE DREDGING
SERVICES ON THE GROUND THAT "THE PUBLIC EXIGENCY WILL NOT PERMIT THE
DELAY INCIDENT TO FORMAL ADVERTISING." A D&F BASED ON THE "PUBLIC
EXIGENCY" EXCEPTION AT 10 U.S.C. SEC. 2304(A)(2) TO THE REQUIREMENT FOR
FORMAL ADVERTISING, HOWEVER, IS GENERALLY INADEQUATE TO JUSTIFY
NEGOTIATION WITH ONLY ONE SOURCE. NON-LINEAR SYSTEMS, INC.; DATA
PRECISION CORPORATION, 55 COMP.GEN. 358 (1975), 75-2 CPD 219.
NONETHELESS, WHERE, AS HERE, THE CIRCUMSTANCES SURROUNDING THE
PROCUREMENT JUSTIFY MAKING A SOLE-SOURCE AWARD, AN AGENCY'S FAILURE TO
PREPARE A PROPER D&F IS NOT AN ERROR THAT AFFECTS THE VALIDITY OF THE
AWARD. SEE STARLIGHT COMPONENTS, INC., B-194367, DECEMBER 5, 1979, 79-2
CPD 390.
THE CORPS STATES THAT IT DETERMINED THAT NATCO WAS THE ONLY FIRM WITH
A HOPPER DREDGE THAT WAS CAPABLE OF PERFORMING THE CRITICAL DREDGING
WORK WITHIN THE REQUIRED TIMEFRAME. NEITHER PROTESTER HAS SHOWN THAT
THIS DETERMINATION WAS UNREASONABLE, NOR HAS EITHER CONTENDED THAT IT
COULD HAVE SUPPLIED A HOPPER DREDGE. UNDER THESE CIRCUMSTANCES, WE
BELIEVE THAT THE CORPS' DECISION TO AWARD A SOLE-SOURCE CONTRACT WAS
PROPER. SEE AMRAY, INC., B-209186, JUNE 30, 1983, 83-2 CPD .
MERRITT ALSO CONTENDS THAT THE CORPS WAS OBLIGATED TO NEGOTIATE WITH
IT FOR THE EMERGENCY DREDGING BECAUSE IT HAD BID ON THE ORIGINAL
SOLICITATION. THIS CONTENTION IS WITHOUT MERIT, SINCE THE PROTESTER HAS
NOT SHOWN THAT IT COULD HAVE SUPPLIED A HOPPER DREDGE. FURTHER, WHILE
MERRITT CONTENDS THAT THE CORPS' CONTACTS WITH IT REGARDING ITS ABILITY
TO PERFORM THE WORK REQUIRED BY THE ORIGINAL SOLICITATION WAS "PART OF
AN OBVIOUS PLAN TO PRECLUDE A PROTEST BEFORE AWARD OF THE SOLE-SOURCE
CONTRACT," MERRITT HAS NOT PRODUCED EVIDENCE TO SUPPORT THIS CONTENTION.
THEREFORE, WE CONSIDER THE ALLEGATION PURELY SPECULATIVE AND WITHOUT
MERIT. CONSOLIDATED SERVICES, INC., B-206413.3, FEBRUARY 28, 1983, 83-1
CPD 192. IN ANY EVENT, WE DO NOT BELIEVE THAT IT IS IMPROPER OR UNUSUAL
FOR AN AGENCY TO HOLD PRELIMINARY DISCUSSIONS REGARDING MATTERS OF
RESPONSIBILITY WITH THE SECOND LOW BIDDER PENDING THE OUTCOME OF THE LOW
BIDDER'S COC PROCEEDINGS.
MERRITT ARGUES THAT EVEN IF THE AWARD TO NATCO WAS PROPER THERE WAS
NO COMPELLING REASON TO CANCEL THE SOLICITATION SINCE A SUBSTANTIAL
PROPORTION OF THE MATERIAL ORIGINALLY SPECIFIED IN THE SOLICITATION
STILL REMAINED TO BE DREDGED AFTER THE SOLE-SOURCE WORK WAS COMPLETED.
IT ARGUES THAT ANY DIFFERENCES IN THE REMAINING AMOUNT AND THE AMOUNT
ORIGINALLY SPECIFIED COULD BE ACCOMMODATED UNDER THE "VARIATIONS IN
ESTIMATED QUANTITIES" CLAUSE OF THE SOLICITATION. IT ALSO CONTENDS THAT
THE CONTRACTING OFFICER FAILED TO PREPARE A WRITTEN DETERMINATION
SUPPORTING HIS DECISION TO CANCEL THE SOLICITATION AS REQUIRED BY DAR
SEC. 2-404.1(B). SHAW TAKES ESSENTIALLY THE SAME POSITION AS MERRITT IN
ADDITION TO ARGUING THAT THE CORPS' ACTION IMPROPERLY INTERFERED WITH
SBA'S COC PROCESS.
THE CORPS' LETTERS TO THE BIDDERS NOTIFYING THEM OF THE CANCELLATION
STATED THAT ITS ACTION WAS NECESSARY FOR THE FOLLOWING REASONS:
(1) THE CHANGES IN THE SCOPE OF THE WORK TO BE
PERFORMED, AND;
(2) THE AVAILABILITY OF A GOVERNMENT DREDGE TO
PERFORM THE WORK.
THE CORPS STATES THAT THE SCOPE OF WORK DESCRIBED IN THE SOLICITATION
CHANGED AS A RESULT OF THE AWARD TO NATCO BECAUSE THE DREDGING DONE
UNDER THAT CONTRACT REMOVED MOST OF THE MATERIAL LOCATED CLOSEST TO THE
BANK OF THE CHANNEL. IT REPORTS THAT THIS MATERIAL WAS THE EASIEST AND
MOST COST EFFECTIVE TO REMOVE. THEREFORE, IN THE CORPS' OPINION,
BIDDERS UNDER THE ORIGINAL SOLICITATION WOULD HAVE HAD TO INCREASE THEIR
UNIT PRICES FOR THE REMAINING WORK. THE CORPS CONTENDS THAT IT WOULD
HAVE BEEN IMPROPER TO AWARD A CONTRACT UNDER THE SOLICITATION WITH
KNOWLEDGE THAT THE SPECIFICATIONS DID NOT ACCURATELY REFLECT THE CURRENT
CONDITIONS. MOREOVER, THE CORPS STATES THAT IT WAS NOT CAPABLE OF
PERFORMING THE WORK REQUIRED BY THE SOLICITATION WITH ITS OWN DREDGE AT
THE TIME THE IFB WAS ISSUED, BUT BECAUSE OF THE DELAY ENCOUNTERED IN
MAKING AN AWARD, ITS DREDGE BECAME AVAILABLE TO PERFORM THE WORK AND IT
DETERMINED THAT IT WOULD BE IN THE BEST INTERESTS OF THE GOVERNMENT FOR
THE CORPS TO PERFORM THE REMAINING WORK WITH ITS OWN DREDGE.
CANCELLATION OF A SOLICITATION AFTER BID OPENING AND THE EXPOSURE OF
BIDS IS NOT PERMITTED UNLESS A COGENT AND COMPELLING REASON FOR
CANCELLATION EXISTS. THE DETERMINATION AS TO WHETHER SUCH A REASON
EXISTS IS, HOWEVER, AN ADMINISTRATIVE ONE TO WHICH WE WILL NOT OBJECT
UNLESS THE PROTESTER CAN DEMONSTRATE THAT THE DECISION WAS ARBITRARY,
CAPRICIOUS, OR NOT SUPPORTED BY SUBSTANTIAL EVIDENCE. MCGREGOR PRINTING
CORPORATION, B-207084; B-207377, SEPTEMBER 20, 1982, 82-2 CPD 240. THE
PROTESTERS HAVE FAILED TO MAKE THAT SHOWING HERE.
WHILE MERRITT ASSERTS THAT THE CHANGE IN THE OVERALL AMOUNT OF
MATERIAL TO BE DREDGED IS NOT SO SIGNIFICANT AS TO REQUIRE A CHANGE IN
THE SCOPE OF THE SOLICITATION, IT HAS NOT DISPUTED THE CORPS' ASSERTION
THAT NATCO REMOVED THE MATERIAL THAT WAS THE MOST COST EFFECTIVE TO
DREDGE. THUS, WE HAVE NO BASIS TO DISPUTE THE CORPS' CONCLUSION THAT
THE EMERGENCY WORK NECESSITATED A REVISION IN THE ESTIMATED AMOUNT OF
WORK AND, MOST SIGNIFICANTLY, WOULD LIKELY HAVE CAUSED THE BIDDERS TO
INCREASE THEIR UNIT PRICES FOR THE REMAINING WORK. THIS CLEARLY
CONSTITUTES A COMPELLING REASON TO CANCEL THE SOLICITATION. PRAXIS
ASSURANCE VENTURE, B-190200, MARCH 15, 1978, 78-1 CPD 203. FURTHER, WE
CANNOT ACCEPT MERRITT'S CONTENTION THAT THE VARIATIONS IN ESTIMATED
QUANTITIES CLAUSE OF THE SOLICITATION COULD HAVE BEEN INVOKED TO ADJUST
THE CONTRACTOR'S UNIT PRICE TO COVER THE REDUCED QUANTITY OF MATERIAL.
THAT CLAUSE WAS INTENDED TO OPERATE WHEN THE CONDITIONS ACTUALLY
ENCOUNTERED TURN OUT TO BE SUBSTANTIALLY DIFFERENT FROM THOSE
CONTEMPLATED BY THE SPECIFICATIONS. HERE, WHERE IT WAS KNOWN PRIOR TO
EXECUTING THE CONTRACT THAT THE SCOPE OF WORK UNDER THE CONTRACT WOULD
BE MATERIALLY DIFFERENT FROM THAT CONTAINED IN THE SPECIFICATIONS, IT
WOULD HAVE BEEN IMPROPER FOR THE CONTRACTING OFFICER TO AWARD A CONTRACT
UNDER THE EXISTING SOLICITATION. MCGREGOR PRINTING CORPORATION, SUPRA.
MOREOVER, THE AVAILABILITY OF THE CORPS' DREDGE EFFECTIVELY RENDERED
UNNECESSARY THE SERVICES OF BIDDERS UNDER THE SOLICITATION. THE
REGULATIONS SPECIFICALLY PROVIDE THAT A SOLICITATION MAY BE CANCELED
WHEN THE SERVICES TO BE PROCURED ARE NO LONGER NEEDED. DAR SEC.
2-404.1(B)(III). ALTHOUGH THE PROTESTERS ARGUE THAT THE CORPS' DREDGE
WAS NOT IN FACT AVAILABLE AT THE TIME OF THE FEBRUARY 10 CANCELLATION,
THIS IS NOT RELEVANT TO THE VALIDITY OF THE CANCELLATION SINCE THE CORPS
DETERMINED THAT THE DREDGE WOULD BE AVAILABLE TO PERFORM THE REQUIRED
SERVICES AND IN FACT THE CORPS' DREDGE BECAME AVAILABLE ON APRIL 1. SEE
ESSEX ELECTRO ENGINEERS, INC., B-206012.3, OCTOBER 4, 1982, 82-2 CPD
307.
WHILE IT IS TRUE, AS MERRITT ARGUES, THAT THE CONTRACTING OFFICER DID
NOT PREPARE A FORMAL WRITTEN DETERMINATION JUSTIFYING THE CANCELLATION,
THIS FAILURE DOES NOT CONSTITUTE A BASIS FOR SUSTAINING A PROTEST AS
LONG AS THE CIRCUMSTANCES NECESSARY TO SUPPORT A CANCELLATION ARE
PRESENT. SEE CALMA COMPANY, B-209260.2, JUNE 28, 1983, 83-2 CPD .
HERE, WE HAVE CONCLUDED THAT THE RECORD SUPPORTS THE CORPS' CANCELLATION
OF THE ORIGINAL SOLICITATION. IN ANY EVENT, THE LETTERS TO THE BIDDERS
NOTIFYING THEM OF THE CANCELLATION CLEARLY SET FORTH THE CONTRACTING
OFFICER'S RATIONALE FOR HIS ACTION.
FINALLY, SHAW CONTENDS THAT THE SOLE-SOURCE AWARD AND SUBSEQUENT
CANCELLATION OF THE SOLICITATION WERE MERELY DEVICES USED BY THE CORPS
TO AVOID AWARDING A CONTRACT TO SHAW. IT CONTENDS THAT THE CORPS DID
NOT MAKE THE SOLE-SOURCE AWARD UNTIL THE SBA NOTIFIED THE CORPS OF THE
IMPENDING ISSUANCE OF A COC TO SHAW. THE PROTESTER ALSO CONTENDS THAT
IT WAS IMPROPER FOR THE CORPS TO MAKE THE SOLE-SOURCE AWARD AND TO
CANCEL THE SOLICITATION WHILE THE COC PROCESS WAS PENDING.
SHAW'S CONTENTIONS ARE WITHOUT MERIT INASMUCH AS WE HAVE FOUND THAT
BOTH THE SOLE-SOURCE AWARD AND THE CANCELLATION OF THE SOLICITATION WERE
PROPER. MOREOVER, THE RECORD SHOWS THAT THE NAVY HAD COMPLAINED OF THE
ADDITIONAL SHOALING, AND THAT THE CORPS AWARDED THE CONTRACT TO NATCO
BEFORE SBA'S REGIONAL OFFICE NOTIFIED THE CORPS OF THE IMPENDING
APPROVAL OF SHAW'S COC APPLICATION. FINALLY, CANCELLATION OF THE
SOLICITATION IS PROPER, EVEN IN THE FACE OF A PENDING COC APPLICATION,
WHERE, AS HERE, THE CONTRACTING OFFICER HAS A COMPELLING REASON TO DO
SO. BAXTER & SONS ELEVATOR CO., INC., B-197595, DECEMBER 3, 1980, 80-2
CPD 414.
SHAW AND MERRIT HAVE REQUESTED REIMBURSEMENT OF THEIR BID PREPARATION
COSTS. SINCE WE HAVE FOUND THAT THE CORPS HAD A SUFFICIENT BASIS FOR
MAKING THE SOLE-SOURCE AWARD AND THAT IT ACTED PROPERLY IN CANCELING THE
SOLICITATION, WE HAVE NO BASIS TO ALLOW RECOVERY OF BID PREPARATION
COSTS.
WE DENY THE PROTESTS.
FN1 SIMPLY STATED, A HOPPER DREDGE IS A SHIP EQUIPPED TO PERFORM A
DREDGING OPERATION BY MAKING REPEATED PASSES OVER THE AREA TO BE
DREDGED, REMOVING THE MATERIAL, AND TRANSPORTING THE MATERIAL TO AN
OCEAN DUMPING SITE. BY CONTRAST, A PIPELINE DREDGE CONSISTS OF A
DREDGING MACHINE LOCATED ON A BARGE-LIKE PLATFORM AND CONNECTED BY A
PIPELINE TO AN ONSHORE DISPOSAL SITE. UNLIKE THE HOPPER DREDGE THE
PIPELINE DREDGE REMAINS SUBSTANTIALLY STATIONARY OVER A DREDGE SITE,
REMOVES THE MATERIAL AT THAT SITE, AND THEN MOVES ON TO THE NEXT SITE.
B-210780, MAR 15, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT CONSIDER PROTEST OF CONTRACTING AGENCY'S DETERMINATION
OF NONRESPONSIBILITY OF SMALL BUSINESS WHERE MATTER WAS REFERRED TO THE
SMALL BUSINESS ADMINISTRATION, WHICH DECLINED TO ISSUE A CERTIFICATE OF
COMPETENCY, NOR WILL GAO REVIEW SBA'S DECISION.
TRI-STATE BUILDING SYSTEMS, INC.:
TRI-STATE BUILDING SYSTEMS, INC. (TRI-STATE), A SMALL BUSINESS,
PROTESTS BEING FOUND NONRESPONSIBLE UNDER INVITATION FOR BIDS NO.
3-3-15R ISSUED BY THE DEPARTMENT OF THE INTERIOR, NATIONAL PARK SERVICE
(NPS), FOR CONSTRUCTION OF THE VISITOR'S ENTRANCE BUILDING AT THE EAST
ENTRANCE OF THE WHITE HOUSE. TRI-STATE ALSO PROTESTS THE REFUSAL OF THE
SMALL BUSINESS ADMINISTRATION (SBA) TO ISSUE IT A CERTIFICATE OF
COMPETENCY (COC) AFTER NPS REFERRED THE MATTER TO SBA. TRI-STATE ARGUES
THAT THE SBA REFUSED TO ISSUE IT A COC FOR REASONS UNRELATED TO THOSE
CITED BY NPS IN ITS FINDING OF NONRESPONSIBILITY AND THAT SBA APPLIED AN
INCORRECT STANDARD IN DENYING THE COC.
SBA HAS AUTHORITY UNDER ITS COC PROCEDURES TO ISSUE FINAL
DETERMINATIONS ON WHETHER SMALL BUSINESS CONCERNS ARE RESPONSIBLE TO
RECEIVE AND PERFORM SPECIFIC CONTRACTS AND THAT DETERMINATION IS
CONCLUSIVE ON THIS OFFICE. 15 U.S.C. SEC. 637(B)(7) (SUPP. II, 1979).
CONSEQUENTLY, OUR OFFICE HAS CONSISTENTLY DECLINED TO REVIEW A
CONTRACTING AGENCY'S DETERMINATION OF NONRESPONSIBILITY WHERE THE
DETERMINATION HAS BEEN AFFIRMED BY SBA'S REFUSAL TO ISSUE A COC UNLESS
THE PROTESTER MAKES A PRIMA FACIE SHOWING OF FRAUD OR THE RECORD
INDICATES THAT VITAL INFORMATION RELEVANT TO THE PROTESTER'S
RESPONSIBILITY WAS WILLFULLY DISREGARDED. DATA TRANSFORMATION
CORPORATION, B-208089, AUGUST 27, 1982, 82-2 CPD 182. SINCE NEITHER OF
THESE EXCEPTIONS IS PRESENT HERE, WE WILL NOT CONSIDER THE PROTEST.
THE PROTEST IS DISMISSED.
B-210779, MAR 8, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST THAT PROCUREMENT SHOULD HAVE BEEN SET ASIDE FOR SMALL
BUSINESS IS SUMMARILY DENIED SINCE, WITH CERTAIN EXCEPTIONS NOT RELEVANT
HERE, NOTHING IN THE SMALL BUSINESS ACT OR REGULATIONS MANDATES THAT ANY
PARTICULAR PROCUREMENT BE SET ASIDE FOR SMALL BUSINESS.
EAGLE CRUSHER COMPANY, INC.:
EAGLE CRUSHER COMPANY, INC., PROTESTS THE DEFENSE LOGISTICS AGENCY'S
(DLA) FAILURE TO SET ASIDE FOR SMALL BUSINESS SOLICITATION NO. DLA
700-83-B-0390 FOR ONE PORTABLE STONE CRUSHER.
WE SUMMARILY DENY THE PROTEST.
WITH CERTAIN EXCEPTIONS NOT RELEVANT HERE, THERE IS NOTHING IN THE
SMALL BUSINESS ACT OR PROCUREMENT REGULATIONS THAT MAKE IT MANDATORY
THAT ANY PARTICULAR PROCUREMENT BE SET ASIDE FOR SMALL BUSINESS. ROMAR
CONSULTANTS, INC., B-206764, MARCH 29, 1982, 82-1 CPD 290. WHILE THE
GOVERNMENT'S POLICY IS THAT A FAIR PROPORTION OF PURCHASES BE PLACED
WITH SMALL BUSINESS CONCERNS, THE DECISION WHETHER A PARTICULAR
PROCUREMENT SHOULD BE SET ASIDE FOR SMALL BUSINESS IS ESSENTIALLY WITHIN
THE DISCRETION OF THE CONTRACTING ACTIVITIES. ROMAR CONSULTANTS INC.,
SUPRA. THEREFORE, WE CANNOT LEGALLY OBJECT TO DLA'S FAILURE TO SET
ASIDE THE PROCUREMENT IN QUESTION.
THE PROTEST IS SUMMARILY DENIED.
B-210779.2, JUN 27, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
REQUEST FOR RECONSIDERATION IS DISMISSED AS ACADEMIC WHERE REQUESTING
FIRM HAS BEEN AWARDED A CONTRACT UNDER DISPUTED PROCUREMENT.
EAGLE CRUSHER COMPANY, INC. - RECONSIDERATION:
EAGLE CRUSHER COMPANY, INC. REQUESTS RECONSIDERATION OF OUR DECISION,
EAGLE CRUSHER COMPANY, INC., B-210779, MARCH 8, 1983, 83-1 CPD 237,
INVOLVING THE PROCUREMENT OF ONE PORTABLE STONE CRUSHER BY THE DEFENSE
LOGISTICS AGENCY (DLA) UNDER SOLICITATION NO. DLA-83-B-0390.
IN OUR PRIOR DECISION WE DENIED EAGLE'S PROTEST THAT THE SUBJECT
PROCUREMENT SHOULD HAVE BEEN SET ASIDE FOR SMALL BUSINESS. WE CONCLUDED
THAT, WITH CERTAIN EXCEPTIONS, NOTHING IN THE SMALL BUSINESS ACT OR
REGULATIONS MANDATES THAT ANY PARTICULAR PROCUREMENT BE SET ASIDE FOR
SMALL BUSINESS.
IN ITS RECONSIDERATION REQUEST, THE PROTESTER ESSENTIALLY REARGUES
ITS EARLIER POINTS CONCERNING THE MERITS OF SETTING THE PROCUREMENT
ASIDE FOR SMALL BUSINESS AND RAISES ONE NEW ARGUMENT - THAT DLA
IMPROPERLY CONSIDERED BIG BUSINESS PLANNED PRODUCERS IN THE INSTANT
PROCUREMENT TO THE DETRIMENT OF SMALL FIRMS CAPABLE OF SATISFYING THE
DEPARTMENT OF DEFENSE'S NEEDS FOR CRUSHER PLANTS. FN1
WE HAVE BEEN ADVISED BY THE AGENCY THAT EAGLE HAS BEEN AWARDED A
CONTRACT AS THE LOW BIDDER UNDER THE SUBJECT SOLICITATION. AWARD OF THE
CONTRACT TO EAGLE RENDERS ITS REQUEST FOR RECONSIDERATION ACADEMIC SINCE
THE AGENCY HAS DONE WHAT THE PROTESTER HAD ORIGINALLY REQUESTED IN ITS
INITIAL PROTEST - AWARDED THE CONTRACT TO A SMALL BUSINESS. SEE ANDREW
CORPORATION, B-197203, FEBRUARY 23, 1981, 81-1 CPD 124.
THE REQUEST FOR RECONSIDERATION IS DISMISSED.
FN1 DEFENSE ACQUISITION REGULATION SEC. 1-2201(D) DEFINES A "PLANNED
PRODUCER" AS "AN INDUSTRIAL FIRM WHICH HAS INDICATED ITS WILLINGNESS TO
PRODUCE SPECIFIED MILITARY ITEMS IN A NATIONAL EMERGENCY BY COMPLETING
AN INDUSTRIAL PREPAREDNESS PROGRAM PRODUCTION PLANNING SCHEDULE (DD FORM
1519)."
B-210776, MAY 19, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST QUESTIONING THE AWARDEE'S FINANCIAL AND PHYSICAL
CAPABILITY OF PERFORMING THE CONTRACT PRESENTS A MATTER OF
RESPONSIBILITY AND GAO WILL NOT REVIEW AN AFFIRMATIVE DETERMINATION OF
RESPONSIBILITY EXCEPT IN LIMITED CIRCUMSTANCES.
2. AN ALLEGATION THAT THE AWARDEE DOES NOT INTEND TO PERFORM THE
CONTRACT IN ACCORDANCE WITH ITS TERMS IS A MATTER OF CONTRACT
ADMINISTRATION WHICH WILL NOT BE CONSIDERED BY GAO.
JANKE AND CO., INC.:
JANKE AND CO., INC. PROTESTS THE AWARD OF A CONTRACT TO HYDRAULICS
INTERNATIONAL, INC., UNDER REQUEST FOR PROPOSALS (RFP) NO.
N00140-82-R-5325 ISSUED BY THE DEPARTMENT OF THE NAVY. THE SOLICITATION
IS FOR PORTABLE HYDRAULIC POWER UNITS. JANKE CONTENDS THAT THE AWARDEE
IS NOT A RESPONSIBLE BIDDER AND THAT IT DOES NOT INTEND TO SUPPLY
SOURCE-APPROVED COMPONENTS AS REQUIRED BY THE RFP. WE DISMISS THE
PROTEST.
JANKE FIRST CONTENDS THAT HYDRAULICS LACKS THE PHYSICAL AND FINANCIAL
CAPACITY REQUIRED TO PERFORM THE CONTRACT. JANKE ARGUES THAT IN VIEW OF
THE LIMITED SIZE OF HYDRAULICS' PHYSICAL PLANT AND WORK FORCE AND THE
LARGE SCOPE OF RECENT CONTRACT AWARDS, THE NAVY'S FINDING THAT JANKE IS
A RESPONSIBLE BIDDER IS INCORRECT.
OUR OFFICE DOES NOT REVIEW AFFIRMATIVE DETERMINATIONS OF
RESPONSIBILITY UNLESS THERE IS A SHOWING OF POSSIBLE FRAUD ON THE PART
OF PROCURING OFFICIALS OR MISAPPLICATION OF DEFINITIVE RESPONSIBILITY
CRITERIA. HOOPER GOODE. INC., B-209830, MARCH 30, 1983, 83-1 CPD 329.
JANKE HAS NOT MADE A SHOWING OF POSSIBLE FRAUD ON THE PART OF NAVY
OFFICIALS AND THE SOLICITATION CONTAINS NO DEFINITIVE RESPONSIBILITY
CRITERIA. THEREFORE, WE WILL NOT CONSIDER THIS CONTENTION.
JANKE ALSO CONTENDS THAT HYDRAULICS DOES NOT INTEND TO SUPPLY
HYDRAULIC POWER UNITS THAT CONFORM TO THE SPECIFICATIONS. THE
SPECIFICATIONS CONTAIN A SERIES OF DRAWINGS OF COMPONENTS OF THE UNITS.
FOR MANY COMPONENTS, THE DRAWINGS LIST SUGGESTED SOURCES OR APPROVED
SOURCES. JANKE IS AN APPROVED OR SUGGESTED SOURCE FOR THREE OF THE
COMPONENTS. SINCE HYDRAULICS HAS NOT CONTACTED JANKE FOR QUOTATIONS ON
ANY OF THESE COMPONENTS, JANKE SURMISES THAT HYDRAULICS WILL NOT COMPLY
WITH THE SPECIFICATIONS.
INITIALLY, WE NOTE THAT THERE ARE OTHER APPROVED OR SUGGESTED SOURCES
FROM WHICH HYDRAULICS COULD PROCURE TWO OF THE THREE COMPONENTS.
MOREOVER, THE RFP PERMITS THE USE OF SUBSTITUTE SOURCES IF THE PRIOR
APPROVAL OF THE AGENCY IS SECURED. THUS, HYDRAULICS' FAILURE TO REQUEST
QUOTATIONS FROM JANKE DOES NOT RAISE AN INFERENCE THAT HYDRAULICS WILL
NOT COMPLY WITH THE SPECIFICATIONS.
IN ANY EVENT, THERE IS NO INDICATION IN HYDRAULICS' PROPOSAL THAT IT
INTENDS TO SUPPLY HYDRAULIC UNITS WHICH DO NOT COMPLY WITH THE
APPROVED-SOURCE SPECIFICATIONS. JANKE'S ASSERTION THAT HYDRAULICS WILL
NOT PERFORM THE CONTRACT IN ACCORDANCE WITH ITS TERMS IS A MATTER OF
CONTRACT ADMINISTRATION WHICH IS THE RESPONSIBILITY OF THE CONTRACTING
AGENCY AND NOT WITHIN THE PURVIEW OF GAO'S BID PROTEST PROCEDURES.
EQUIPMENT RENEWAL COMPANY, B-211051, MARCH 30, 1983, 83-1 CPD 332.
THE PROTEST IS DISMISSED.
B-210775, AUG 9, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
CONTRACTING AGENCY PROPERLY CANCELED
ADVERTISED SOLICITATION AFTER OPENING
BASED ON COGENT AND COMPELLING REASON
WHERE CONTRACTING AGENCY DID NOT MAIL
MATERIAL AMENDMENT TO ALL PROSPECTIVE
BIDDERS UNTIL DAY BEFORE EXTENDED BID
OPENING, RESULTING IN INADEQUATE
COMPETITION.
MOTT HAVEN TRUCK PARTS, INC.:
MOTT HAVEN TRUCK PARTS, INC. (MOTT HAVEN), PROTESTS THAT THE UNITED
STATES ARMY TANK-AUTOMOTIVE COMMAND (ARMY), WARREN, MICHIGAN, IMPROPERLY
CANCELED INVITATION FOR BIDS (IFB) NO. DAAE07-83-B-A070, FOR 451 ELBOW
KITS. MOTT HAVEN ALLEGES THE ARMY CANCELED THE SOLICITATION AFTER THE
BIDS HAD BEEN OPENED WITHOUT A COGENT AND COMPELLING REASON.
WE DENY THE PROTEST.
THE IFB WAS ISSUED ON NOVEMBER 29, 1982, WITH A BID OPENING DATE OF
DECEMBER 28, 1982. AMENDMENT NO. 0001 EXTENDED BID OPENING TO JANUARY
4, 1983, UPDATED THE LESS RESTRICTIVE SPECIALTY METALS PREFERENCE
CLAUSE, AND DIVIDED THE TOTAL QUANTITY INTO INDIVIDUAL DEPOT SHIPMENTS.
MOTT HAVEN CONTENDS THAT IT SHOULD HAVE BEEN AWARDED THE CONTRACT
BECAUSE IT WAS THE LOWEST RESPONSIVE RESPONSIBLE BIDDER THAT
ACKNOWLEDGED THE AMENDMENT. THE ARMY RESPONDS THAT ON JANUARY 27, 1983,
THE CONTRACTING OFFICER CANCELED THE SOLICITATION PURSUANT TO DEFENSE
ACQUISITION REGULATION SEC. 2-208(C) (DEFENSE ACQUISITION CIRCULAR (DAC)
NO. 76-25, OCTOBER 31, 1980) AND SEC. 2.404.1(B)(VIII) (DAC NO. 76-17,
SEPTEMBER 1, 1978), BECAUSE THE AMENDMENT WAS NOT ISSUED IN SUFFICIENT
TIME TO PERMIT ALL THE PROSPECTIVE BIDDERS TO CONSIDER THE INFORMATION
BEFORE SUBMITTING THEIR BIDS.
WE HAVE HELD THAT THE AUTHORITY OF A CONTRACTING OFFICER TO CANCEL A
SOLICITATION IS EXTREMELY BROAD AND IN THE ABSENCE OF BAD FAITH OR AN
ABUSE OF DISCRETION, A DECISION TO CANCEL A SOLICITATION WILL BE UPHELD.
HOWEVER, BECAUSE OF THE POTENTIAL ADVERSE IMPACT ON THE COMPETITIVE
BIDDING SYSTEM OF CANCELING AN IFB AFTER BID PRICES HAVE BEEN EXPOSED,
CONTRACTING OFFICERS, IN THE EXERCISE OF THEIR DISCRETIONARY AUTHORITY,
MUST FIND THAT A COGENT AND COMPELLING REASON EXISTS WHICH WARRANTS
CANCELLATION. NONPUBLIC EDUCATIONAL SERVICES, INC., B-207751, MARCH 8,
1983, 83-1 CPD 232.
THE ARMY REPORTS THAT ON DECEMBER 27, 1982, MOTT HAVEN CONTACTED THE
CONTRACTING SPECIALIST TO REPORT THAT THE SOLICITATION CONTAINED ERRORS.
AMENDMENT NO. 0001, WHICH THE ARMY INFORMED MOTT HAVEN WOULD BE MADE,
REFLECTED CORRECTIONS IN THE IFB TO RESPOND TO MOTT HAVEN. AFTER THE
ARMY EXECUTED THE STANDARD PROCEDURE FOR PROCESSING AMENDMENTS, ON
JANUARY 3, 1983, THE DAY BEFORE THE EXTENDED BID OPENING, THE AMENDMENT
WAS DISPATCHED BY ORDINARY MAIL TO 90 POTENTIAL BIDDERS WHICH HAD
RECEIVED COPIES OF THE SOLICITATION. SIXTY-EIGHT WERE LOCATED OUT OF
STATE, INCLUDING THE PROTESTER, AND 22 WERE LOCAL. THE ARMY NEITHER
ATTEMPTED TO CONTACT ANY POTENTIAL BIDDERS BY TELEPHONE NOR BY OTHER
MEANS TO INFORM THEM OF THE AMENDMENT.
FOUR BIDS WERE OPENED ON JANUARY 4, 1983. THE ARMY NOTED THAT THE
TWO LOWEST BIDDERS, WHICH WERE BOTH FROM OUT OF STATE AND WHOSE BIDS
REFLECTED DATES OF DECEMBER 28 AND 22, 1982, RESPECTIVELY, FAILED TO
ACKNOWLEDGE THE AMENDMENT. THE LOW BIDDER TELEPHONED THE ARMY ON JANUARY
4, 1983, AND ADVISED THAT THE AMENDMENT JUST HAD BEEN RECEIVED. THE
SECOND LOW BIDDER CONTACTED THE ARMY ON JANUARY 5, 1983, AND INDICATED
THAT THE AMENDMENT JUST HAD BEEN RECEIVED. BOTH BIDDERS REQUESTED
PERMISSION TO MAIL THE AMENDMENT LATE. THE ARMY ALSO NOTED THAT MOTT
HAVEN, THE THIRD LOW BIDDER AND THE ONLY POTENTIAL BIDDER WHICH HAD
ADVANCE KNOWLEDGE OF THE AMENDMENT, ACKNOWLEDGED THE AMENDMENT BY
REFERENCE ONLY, BUT THE AMENDMENT ITSELF WAS NOT SUBMITTED. THE FOURTH
LOW BIDDER, A LOCAL COMPANY, SUBMITTED A BID DATED DECEMBER 27, 1982,
WITH AN EXECUTED AMENDMENT, DATED JANUARY 4, 1983.
BASED UPON THE ABOVE CIRCUMSTANCES, WE CONCUR WITH THE CONTRACTING
OFFICER'S DETERMINATION THAT THE UNTIMELY DISPATCH OF THE AMENDMENT WAS
A COGENT AND COMPELLING REASON FOR JUSTIFYING CANCELLATION DUE TO THE
LACK OF ADEQUATE COMPETITION. CLEARLY, THE UNTIMELY DISPATCH HAD AN
ADVERSE IMPACT UPON POTENTIAL AND ACTUAL BIDDERS IN VIEW OF THE MATERIAL
CHANGES MADE BY THE AMENDMENT. FURTHERMORE, THE PROTESTER WAS THE LOW,
RESPONSIVE BIDDER ONLY BECAUSE OF ITS ADVANCE KNOWLEDGE OF THE
AMENDMENT, TO THE CLEAR PREJUDICE OF OTHERS INTERESTED IN THE
PROCUREMENT. SEE ANDERO CONSTRUCTION INC., B-203898, FEBRUARY 16, 1982,
82-1 CPD 133. ROYSON ENGINEERING COMPANY, B-187327, JANUARY 27, 1977,
77-1 CPD 69; 45 COMP.GEN. 651 (1966).
ACCORDINGLY, WE DENY THE PROTEST.
B-210766, FEB 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST OF AGENCY DECISION TO AWARD CONTRACT UNDER SECTION 8(A) OF
THE SMALL BUSINESS ACT IS NOT FOR CONSIDERATION BY GAO IN ABSENCE OF
SHOWING OF POSSIBLE FRAUD OR BAD FAITH ON THE PART OF GOVERNMENT
OFFICIALS OR A FAILURE BY AGENCY OFFICIALS TO FOLLOW APPLICABLE
REGULATIONS.
MGL CONSTRUCTION, INC.:
MGL CONSTRUCTION, INC., PROTESTS THE CORPS OF ENGINEERS' DECISION TO
AWARD A CONTRACT FOR DRAINAGE IMPROVEMENTS UNDER SECTION 8(A) OF THE
SMALL BUSINESS ACT, 15 U.S.C. SEC. 637(A) (SUPP. IV 1980). MGL ALLEGES
THAT IT IS A SMALL BUSINESS COMPANY AND THAT THIS AND OTHER ANTICIPATED
8(A) AWARDS WILL CREATE A "MAJOR HARDSHIP" FOR IT SINCE IT NOW RECEIVES
ALL OF ITS BUSINESS FROM THE CORPS. WE DISMISS THE PROTEST.
SECTION 8(A) AUTHORIZES THE SMALL BUSINESS ADMINISTRATION (SBA) TO
ENTER INTO CONTRACTS WITH ANY GOVERNMENT AGENCY WITH PROCURING AUTHORITY
AND TO ARRANGE FOR PERFORMANCE OF SUCH CONTRACTS BY LETTING SUBCONTRACTS
TO SOCIALLY AND ECONOMICALLY DISADVANTAGED SMALL BUSINESS CONCERNS. THE
AGENCY CONTRACTING OFFICER IS AUTHORIZED "IN HIS DISCRETION" TO LET THE
CONTRACT TO SBA UPON SUCH TERMS AND CONDITIONS AS MAY BE AGREED UPON BY
THE PROCURING AGENCY AND SBA. IN LIGHT OF THIS BROAD DISCRETION, WE DO
NOT REVIEW AGENCY DETERMINATIONS TO AWARD CONTRACTS UNDER SECTION 8(A)
UNLESS THERE IS A SHOWING OF POSSIBLE BAD FAITH OR FRAUD ON THE PART OF
GOVERNMENT OFFICIALS OR THAT APPLICABLE REGULATIONS HAVE NOT BEEN
FOLLOWED. WAKON REDBIRD & ASSOCIATES, B-205995, FEBRUARY 8, 1982, 82-1
CPD 111; KINGS POINT MFG. CO., INC., 54 COMP.GEN. 913 (1975), 75-1 CPD
264.
MGL DOES NOT ALLEGE FRAUD OR BAD FAITH ON THE PART OF GOVERNMENT
OFFICIALS OR THAT REGULATIONS HAVE NOT BEEN FOLLOWED. ACCORDINGLY, THE
PROTEST IS DISMISSED. WE POINT OUT, HOWEVER, THAT IT IS SBA POLICY TO
CONSIDER ANY ADVERSE IMPACT ON SMALL BUSINESSES BEFORE AGREEING TO
ACCEPT PROCUREMENTS UNDER THE 8(A) PROGRAM. THEREFORE, THE PROTESTER
MAY, IF IT DESIRES, PROVIDE APPROPRIATE INFORMATION CONCERNING THE
ADVERSE IMPACT ON IT OF 8(A) AWARDS TO SBA FOR THAT AGENCY'S
CONSIDERATION.
B-210766.2, APR 25, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT REVIEW THE SMALL BUSINESS ADMINISTRATION'S COMPLIANCE
WITH ITS OWN INTERNAL GUIDELINES FOR THE SMALL BUSINESS ACT'S SECTION
8(A) PROGRAM ABSENT A SHOWING OF POSSIBLE FRAUD OR BAD FAITH ON THE PART
OF GOVERNMENT OFFICIALS.
M G L CONSTRUCTION, INC.:
M G L CONSTRUCTION, INC. PROTESTS THE CORPS OF ENGINEERS' DECISION TO
AWARD SEVERAL CONTRACTS TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR
SUBCONTRACT AWARDS PURSUANT TO SECTION 8(A) OF THE SMALL BUSINESS ACT,
15 U.S.C. SEC. 637(A) (SUPP. IV 1980). SECTION 8(A) AUTHORIZES THE SBA
TO ENTER INTO CONTRACTS WITH ANY GOVERNMENT AGENCY HAVING PROCURING
AUTHORITY AND TO ARRANGE FOR PERFORMANCE BY LETTING SUBCONTRACTS TO
SOCIALLY AND ECONOMICALLY DISADVANTAGED SMALL BUSINESS CONCERNS. M G L
ALLEGES THAT THE SBA DID NOT PREPARE A REPORT ANALYZING THE IMPACT ON
FIRMS NOT IN THE 8(A) PROGRAM OF RESERVING THESE CONTRACTS FOR THE
PROGRAM, AS REQUIRED IN THE SBA'S STANDARD OPERATING PROCEDURE FOR
SECTION 8(A) CONTRACTING.
WE DISMISS THE PROTEST.
BECAUSE OF THE BROAD DISCRETION THE SMALL BUSINESS ACT AFFORDS THE
SBA AND THE CONTRACTING AGENCIES IN SELECTING EFFORTS FOR 8(A)
CONTRACTING, OUR REVIEW OF ACTIONS UNDER THE PROGRAM IS ESSENTIALLY
LIMITED TO DETERMINING WHETHER PROCUREMENT REGULATIONS HAVE BEEN
FOLLOWED AND WHETHER THERE HAS BEEN FRAUD OR BAD FAITH ON THE PART OF
GOVERNMENT OFFICIALS. WAKON REDBIRD & ASSOCIATES, B-205995, FEBRUARY 8,
1982, 82-1 CPD 111.
MOREOVER, THE SBA'S STANDARD OPERATING PROCEDURE MERELY PROVIDES
INTERNAL SBA POLICIES AND GUIDELINES THAT COMPLEMENT THE SBA REGULATIONS
IMPLEMENTING THE 8(A) PROGRAM AT 13 C.F.R. PART 124 (1982). WE HAVE
HELD THAT WE WILL NOT REVIEW THE SBA'S COMPLIANCE WITH THOSE INTERNAL
PROCEDURES ABSENT A SHOWING OF POSSIBLE FRAUD OR BAD FAITH. JETS
SERVICES, INC., B-199721, MARCH 11, 1981, 81-2 CPD 300.
THUS, THE FAILURE TO PREPARE AN IMPACT ANALYSIS DOES NOT IN ITSELF
WARRANT OUR REVIEW OF A DECISION TO PLACE A CONTRACT IN THE SECTION 8(
A) PROGRAM. SINCE M G L DOES NOT SUGGEST THAT THERE HAS BEEN ANY FRAUD
OR BAD FAITH HERE, THE PROTEST IS DISMISSED.
B-210764, NOV 29, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
SOLICITATION IS DEFECTIVE WHERE NAVY'S
POST-AWARD NOTICE TO FIELD ACTIVITIES
SUGGESTS THAT NAVY DID NOT INTEND BIDDERS
FOR MAGAZINE SUBSCRIPTIONS CONTRACT TO
BASE THEIR BIDS ON THE FURNISHING OF
SCIENTIFIC, TECHNICAL, AND MEDICAL PUBLICATIONS.
HOWEVER, UNDER CIRCUMSTANCES,
GAO MUST CONCLUDE THAT BIDDERS COMPUTED
THEIR BIDS BASED ON SUPPLYING AT LEAST
SOME OF THESE PUBLICATIONS. THEREFORE,
THE SOLICITATION WAS DEFECTIVE AND THE
REQUIREMENT SHOULD HAVE BEEN RESOLICITED.
MARKETING INTERNATIONAL, INC.:
MARKETING INTERNATIONAL, INC. (MARKETING), PROTESTS THE AWARD OF A
1-YEAR, INDEFINITE QUANTITY CONTRACT FOR "COMMERCIAL PERIODICAL"
SUBSCRIPTIONS TO AVANTI ENTERPRISES, INC. (AVANTI), UNDER INVITATION FOR
BIDS (IFB) NO. N00140-82-B-C292, ISSUED BY THE NAVAL REGIONAL
CONTRACTING CENTER (NRCC), PHILADELPHIA, PENNSYLVANIA.
WE SUSTAIN THE PROTEST, ALTHOUGH ON A BASIS DIFFERENT FROM THAT
RAISED BY THE PROTESTER.
THE IFB WAS ISSUED ON AUGUST 11, 1982, WITH BID OPENING SET FOR
SEPTEMBER 10, 1982. BIDDERS WERE REQUIRED TO BID ON AN "ESTIMATED
EXPENDITURE OF $600,000 (AT PUBLISHERS' LIST PRICES)." THE BIDDERS'
PRICES FOR THE REQUIRED MAGAZINES WERE TO BE EXPRESSED AS A PERCENTAGE
"DISCOUNT OF THE PUBLISHER'S LIST PRICE IN EFFECT AT THE TIME THE
SUBSCRIPTION IS ACCEPTED BY THE PUBLISHER." THE IFB ALSO CONTAINED A
"QUARTERLY RECAP" OF SUBSCRIPTION ORDERS PLACED DURING THE PERIOD FROM
APRIL 1 THROUGH JUNE 30, 1982, FOR INFORMATIONAL PURPOSES TO GIVE
PROSPECTIVE BIDDERS AN INDICATION OF THE "GENERAL TREND OF ORDERING."
INCLUDED IN THIS RECAP WERE REPORTS OF SUBSCRIPTIONS TO THE "AMERICAN
JOURNAL OF SURGERY," THE "ANNALS OF SURGERY" AND THE "JOURNAL OF
CLINICAL PHARMACOLOGY."
ON AUGUST 23, 1982, THE NAVY ISSUED AMENDMENT NO. 0001, WHICH
CORRECTED AN ERROR IN THE AUGUST 11 IFB. THE ORIGINAL SENTENCE READ:
"THE CONTRACTOR WILL PLACE ALL ORDERS TO THE PUBLISHERS DIRECT WITH
THE." THE CORRECTED SENTENCE READ:
"THE CONTRACTOR WILL PLACE ALL ORDERS TO
THE PUBLISHERS DIRECT WITH THE PUBLISHER UNLESS
THE PUBLISHER REQUIRES THAT THE SUBSCRIPTION
BE PLACED THROUGH AN INTERMEDIATE AGENCY."
FIVE BIDS WERE RECEIVED. MARKETING WAS FOUND TO BE THE APPARENT LOW
BIDDER; HOWEVER, MARKETING'S BID WAS REJECTED BECAUSE IT FAILED TO
ACKNOWLEDGE THE AMENDMENT. ON NOVEMBER 29, 1982, THE NAVY AWARDED THE
CONTRACT TO AVANTI, THE SECOND LOW BIDDER, AND ALSO ISSUED "NRCC
PHILADELPHIA NOTICE 4200" (NOTICE 4200), DATED NOVEMBER 29, 1982, WHICH,
AMONG OTHER THINGS, PRECLUDED FIELD ACTIVITIES FROM ORDERING "TECHNICAL,
SCIENTIFIC, AND MEDICAL" PUBLICATIONS UNDER THE CONTRACT. THE NAVY SENT
MARKETING NOTICE OF THE REJECTION ON NOVEMBER 30.
MARKETING CONTENDS THE REJECTION WAS IMPROPER BECAUSE THE AMENDMENT
ALLEGEDLY HAS NO EFFECT ON THE PRICE, QUANTITY, OR QUALITY OF THE
CONTRACT. MARKETING SUPPORTS ITS ARGUMENT BY NOTING THAT THE NAVY
CHARACTERIZES THE AMENDMENT AS THE CORRECTION OF A TYPOGRAPHICAL ERROR
TO ASSURE THAT THE CONTRACTOR PLACED ORDERS DIRECTLY WITH THE PUBLISHER.
THE NAVY CONTESTS THE TIMELINESS OF THIS GROUND OF PROTEST. BUT WE
NEED NOT DISCUSS THE TIMELINESS ISSUE AND MARKETING'S ALLEGATION THAT
NOTICE 4200 CONSTITUTED AN IMPERMISSIBLE MODIFICATION OF THE CONTRACT
SINCE WE CONCLUDE THAT THE IFB WAS DEFECTIVE AND THAT THE PROPER REMEDY
WOULD NOT HAVE BEEN AN AWARD UNDER THE SUBJECT IFB BUT, RATHER, A
RESOLICITATION OF THE REQUIREMENT.
MARKETING ARGUES THAT THE IFB'S QUARTERLY RECAP SHOWED THAT MANY
TECHNICAL AND SCIENTIFIC PUBLICATIONS WERE ORDERED; THEREFORE, BIDDERS
SHOULD HAVE REASONABLY BID ON THE BASIS THAT A MAJORITY OF THE
PUBLICATIONS TO BE ORDERED WOULD BE OF A TECHNICAL AND SCIENTIFIC
NATURE. THESE TECHNICAL AND SCIENTIFIC PUBLICATIONS, MARKETING FURTHER
ARGUES, ARE OF LOW PROFITABILITY COMPARED WITH GENERAL INTEREST
PUBLICATIONS. AS STATED BY MARKETING:
". . . THERE ARE HIGH PROFIT MARGINS
ASSOCIATED WITH GENERAL INTEREST MAGAZINES.
IN COMPARISON, THE PROFITS ON TECHNICAL MAGAZINES
ARE NEGLIGIBLE. ACCORDINGLY, IF THE
EXPECTATION IS FOR A HIGH LEVEL OF GENERAL
INTEREST MAGAZINES, THE BIDDER'S DISCOUNT
CAN BE HIGHER AND THE OVERALL BID PRICE LOWER."
IN MARKETING'S VIEW, THAT BIDDERS UNDERSTOOD THE NAVY'S REQUIREMENT
TO BE, IN THE MAIN, FOR TECHNICAL AND SCIENTIFIC PUBLICATIONS, IS SHOWN
IN THE RANGE OF BIDDING DISCOUNTS OFFERED (1.8 PERCENT TO 5.5 PERCENT),
WHICH, ALLEGEDLY, ARE IN LINE WITH THE LOW PROFIT MARGINS ASSOCIATED
WITH TECHNICAL AND SCIENTIFIC PUBLICATIONS. BY CONTRAST, MARKETING'S
DISCOUNT ON A PRIOR YEAR'S CONTRACT FOR GENERAL INTEREST MAGAZINES WAS
20 PERCENT.
THE NAVY REPORTS THIS CONTRACT IS THE EIGHTH IN A SERIES OF ANNUAL
CONSOLIDATED CONTRACTS FOR COMMERCIAL PERIODICALS. THE NAVY INSISTS
THAT THESE CONTRACTS WERE NEVER INTENDED TO COVER "TECHNICAL,
SCIENTIFIC, TRADE, REFERENCE, OR OTHER LIMITED CIRCULATION
PUBLICATIONS." TO SUPPORT THIS POSITION, THE NAVY NOTES THAT, UNLIKE THE
PRESENT IFB, THE PRIOR CONTRACT SPECIFICALLY EXCLUDED "TECHNICAL,
SCIENTIFIC, MEDICAL AND TRADE" PUBLICATIONS. THE NAVY ALSO STATES THAT
THERE WAS "NO INTENTION THAT THE CONTRACT . . . WOULD BE EXPANDED TO
INCLUDE THE NAVY'S VAST REQUIREMENTS FOR SPECIALTY PUBLICATIONS." SINCE
MARKETING HAS BEEN THE CONTRACTOR FOR THE PAST 3 YEARS, THE NAVY ARGUES
THERE IS NO BASIS FOR BELIEVING THAT IT BID WITH THESE PUBLICATIONS IN
MIND.
MOREOVER, THE NAVY REPORTS THERE IS NO BASIS FOR SUGGESTING THAT THE
AVANTI CONTRACT IS SIGNIFICANTLY MORE PROFITABLE. THE DIFFERENCE
BETWEEN THE CURRENT CONTRACT AND THE PRIOR CONTRACT IS THAT THE CURRENT
CONTRACT PROVIDES FOR A 5-PERCENT DISCOUNT ON THE TOTAL CONTRACT VALUE
AT THE PUBLISHER'S LIST PRICE WHILE THE PRIOR CONTRACT PROVIDED A
14-PERCENT DISCOUNT FOR 98 PUBLICATIONS LISTED SPECIFICALLY IN THE
CONTRACT, A 20-PERCENT DISCOUNT FOR GENERAL INTEREST PUBLICATIONS, AND A
0-PERCENT DISCOUNT FOR SPECIALTY PUBLICATIONS. THE NAVY INDICATES THAT
THE ACTUAL DISCOUNT RECEIVED ON THE PRIOR CONTRACT FOR 8 MONTHS WAS 6.6
PERCENT. THEREFORE, THE NAVY SAYS THAT THERE IS NO BASIS TO CONCLUDE
THAT THE AVANTI CONTRACT IS MARKEDLY LESS ADVANTAGEOUS.
THE NAVY IS CORRECT IN STATING THAT THE PRIOR CONTRACTS SPECIFICALLY
EXCLUDED TECHNICAL AND SCIENTIFIC PUBLICATIONS. MARKETING ARGUES,
HOWEVER, THAT THE "VAST MAJORITY OF PUBLICATIONS ORDERED UNDER THE PRIOR
CONTRACT FELL IN THE SPECIALTY CATEGORY (SEE QUARTERLY REPORT,
APRIL-JUNE 1982, ORDERS NUMBERS 2155-3388.)" ALTHOUGH THE NAVY
APPARENTLY DENIES MARKETING'S ALLEGATION THAT LIMITED CIRCULATION
PUBLICATIONS WERE ORDERED, THE NAVY HAS NOT SPECIFICALLY REPLIED TO
MARKETING'S ALLEGATION REGARDING THESE ORDERS. AT LEAST SOME OF THESE
PUBLICATIONS (FOR EXAMPLE, THE THREE MEDICAL PUBLICATIONS, NOTED ABOVE)
SEEM TO BE IN THE SPECIALTY CATEGORY. CONSEQUENTLY, WE MUST CONCLUDE
THAT BIDDERS BID DISCOUNTS FOR THE SUBJECT IFB BASED ON SUPPLYING AT
LEAST SOME SCIENTIFIC, TECHNICAL AND MEDICAL PUBLICATIONS. BUT NOTICE
4200 SUGGESTS THAT THE NAVY, IN FACT, DID NOT INTEND THAT BIDDERS SHOULD
SO BASE THEIR BIDS. THEREFORE, WE CONCLUDE THAT THE IFB WAS DEFECTIVE
AND THAT THE REQUIREMENT SHOULD HAVE BEEN RESOLICITED.
ALTHOUGH THE NAVY HAS SUBMITTED THE ACTUAL, AVERAGE DISCOUNT FROM THE
PRIOR CONTRACT IN AN EFFORT TO DEMONSTRATE THAT THE NAVY IS ACHIEVING
THE SAME SAVINGS UNDER THIS CONTRACT, THIS ARGUMENT IS IRRELEVANT. THE
ORDERS UNDER THE PRIOR CONTRACT AND THE IFB'S QUARTERLY RECAP UPON WHICH
BIDDERS' DISCOUNTS WERE BASED APPARENTLY INCLUDED SCIENTIFIC, TECHNICAL
AND MEDICAL PUBLICATIONS. THEREFORE, SIMILAR DISCOUNTS COULD BE
EXPECTED.
ALTHOUGH IT IS IMPRACTICABLE TO RECOMMEND THAT THE CONTRACT BE
RESOLICITED BECAUSE IT IS NEARLY COMPLETED, BY LETTER OF TODAY, WE ARE
ADVISING THE SECRETARY OF THE NAVY OF OUR CONCLUSIONS.
B-210762, MAR 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. ALLEGATIONS OF BELOW-COST BIDDING, INSUFFICIENT EQUIPMENT, AND
INADEQUATE CAPITALIZATION ALL RELATE TO RESPONSIBILITY, AND THEY
STARLITE SERVICES, INC.:
STARLITE SERVICES, INC. PROTESTS THE AWARD OF A CONTRACT FOR
CUSTODIAL SERVICES AT THE NAVAL AIR STATION, CECIL FIELD, FLORIDA, UNDER
SOLICITATION NO. N624-67-83-B-2248. WE DISMISS THE PROTEST.
STARLITE ALLEGES THAT FIRMS BIDDING LESS THAN $62,529.97 WILL BE
UNABLE TO PERFORM REQUIRED SERVICES AS FREQUENTLY AS SPECIFIED; THAT
THE SUGGESTED LIST OF EQUIPMENT AND SUGGESTED CASH RESERVE ARE IN EFFECT
MANDATORY REQUIREMENTS THAT SHOULD BE VERIFIED OR CERTIFIED BEFORE
AWARD; THAT THE APPARENT LOW BIDDER IS NOT ADEQUATELY CAPITALIZED AND
CURRENTLY IS VIOLATING THE SERVICE CONTRACT ACT; AND THAT THE INCUMBENT
CONTRACTOR ALSO HAS NOT PAID EMPLOYEES THE MINIMUM WAGE AS REQUIRED BY
THE ACT
OUR OFFICE WILL NOT REVIEW ANY OF THESE ALLEGATIONS. THE SUBMISSION
OF A BELOW-COST BID IS NOT A VALID BASIS ON WHICH TO CHALLENGE AN AWARD;
RATHER, THE CONTRACTING OFFICER MUST DETERMINE WHETHER THE BIDDER CAN
PERFORM AT ITS BID PRICE, A QUESTION THAT RELATES TO RESPONSIBILITY.
J&R CLEANING AND GENERAL MAINTENANCE, B-206280, FEBRUARY 19, 1982, 82-1
CPD 147. THE EQUIPMENT WITH WHICH THE BIDDER WILL PERFORM AND THE
BIDDER'S FINANCIAL STATUS - CASH RESERVES OR CAPITALIZATION - ALSO
RELATE TO RESPONSIBILITY, AS DOES THE MANNER IN WHICH IT IS PERFORMING
CURRENT CONTRACTS.
AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY MUST BE MADE BEFORE
AWARD. OUR OFFICE DOES NOT REVIEW SUCH DETERMINATIONS UNLESS THERE IS
EVIDENCE OF FRAUD OR BAD FAITH ON THE PART OF CONTRACTING OFFICIALS OR
AN ALLEGATION THAT DEFINITIVE RESPONSIBILITY CRITERIA HAVE NOT BEEN
APPLIED. ID. NEITHER EXCEPTION IS PRESENT HERE.
FINALLY, WHETHER THE SUCCESSFUL BIDDER PERFORMS THIS CONTRACT IN
ACCORD WITH THE SERVICE CONTRACT ACT IS A MATTER FOR THE DEPARTMENT OF
LABOR, WHICH IS RESPONSIBLE FOR ITS ADMINISTRATION. ID.
THE PROTEST IS DISMISSED.
B-210757, SEP 19, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE A SOLICITATION DOES NOT CONTAIN
ADEQUATE SPECIFICATIONS FOR CONTRACT
PERFORMANCE, CANCELLATION AND READVERTISEMENT
OF THE SOLICITATION WITH
REVISED SPECIFICATIONS IS APPROPRIATE. THE
NEGOTIATION OF THE MATERIAL CHANGES
TO THE SPECIFICATIONS WITH THE LOW BIDDER,
AS ADVOCATED BY PROTESTER, WOULD BE
PREJUDICIAL TO OTHER BIDDERS AND IMPROPER.
KINGS POINT MFG. CO., INC.:
KINGS POINT MFG. CO., INC. PROTESTS THE PROPOSED CANCELLATION OF
DEFENSE GENERAL SUPPLY CENTER (DGSC) INVITATION FOR BIDS (IFB) NO. DLA
400-82-B-6854. THE AGENCY CANCELED THE IFB AFTER DETERMINING THAT THE
SPECIFICATIONS WERE DEFICIENT. KINGS POINT, THE LOW BIDDER, CONTENDS
THAT IT SHOULD RECEIVE THE AWARD AND BE PERMITTED TO INCORPORATE
SPECIFICATION CHANGES IN THE CONTRACT. WE DENY THE PROTEST.
THE SOLICITATION CALLED FOR FULL BODY PARACHUTETYPE HARNESSES WHICH
ARE USED AS SAFETY EQUIPMENT IN HAZARDOUS WORKING SITUATIONS WHERE A
FALL MIGHT RESULT IN SERIOUS INJURY OR DEATH. KINGS POINT'S OFFERED
PRODUCT CONFORMED TO THE SOLICITATION'S SPECIFICATIONS. SHORTLY AFTER
BID OPENING, HOWEVER, DGSC WAS NOTIFIED BY THE DEPARTMENT OF THE AIR
FORCE THAT SAFETY HARNESSES PROCURED FROM KINGS POINT UNDER A PREVIOUS
CONTRACT WERE CONSIDERED UNSAFE, BASED ON REPORTS FROM PERSONNEL TO WHOM
THE HARNESSES HAD BEEN ISSUED. THE AIR FORCE STATED THAT IT HAD DECIDED
TO REMOVE FROM USE ALL DEFECTIVE HARNESSES.
TECHNICAL PERSONNEL AT DGSC AND THE NAVAL SEA SYSTEMS COMMAND
(NAVSEA), THE DESIGNATED ENGINEERING SUPPORT ACTIVITY FOR THE HARNESSES,
CONFIRMED THAT THE HARNESSES WERE UNSUITABLE FOR THEIR INTENDED USE.
WHILE JUDGED UNSAFE, HOWEVER, THE HARNESSES WERE FOUND TO MEET THE
SPECIFICATIONS OF THE PREVIOUS CONTRACT, AS WELL AS THE PRESENT
SOLICITATION. ON THE BASIS OF THESE DETERMINATIONS, THE CONTRACTING
OFFICER PROPOSED TO CANCEL THE IFB AND READVERTISE WITH REVISED
SPECIFICATIONS.
KINGS POINT PROTESTS THAT A CANCELLATION AFTER BID OPENING WOULD
VIOLATE THE INTEGRITY OF THE BIDDING PROCESS, AND THAT THE PROPER COURSE
OF ACTION WOULD BE TO PERMIT KINGS POINT TO MODIFY ITS PRODUCT AND PRICE
TO MEET THE NECESSARY SPECIFICATION CHANGES. WE DISAGREE.
AN INVITATION FOR BIDS DOES NOT IMPART ANY OBLIGATION TO ACCEPT ANY
OF THE BIDS RECEIVED. 37 COMP.GEN. 760 (1958). RATHER, ALL BIDS MAY BE
REJECTED WHERE IT IS DETERMINED THAT THERE IS A COMPELLING REASON TO DO
SO. SEE DEFENSE ACQUISITION REGULATION (DAR) SEC. 2-404.1(A) (1976
ED.). CONTRACTING OFFICERS HAVE BROAD DISCRETION TO DETERMINE WHETHER A
COMPELLING REASON EXISTS FOR CANCELING A SOLICITATION AND WE WILL
SUSTAIN A CONTRACTING OFFICER'S DECISION SO LONG AS IT REFLECTS A
REASONED JUDGMENT BASED UPON THE INVESTIGATION AND EVALUATION OF THE
EVIDENCE AVAILABLE AT THE TIME THE DECISION IS MADE. APEX INTERNATIONAL
MANAGEMENT SERVICES, INC., 60 COMP.GEN. 172, 178 (1981), 81-1 CPD 24.
IN THIS CASE, TECHNICAL PERSONNEL AT DGSC AND NAVSEA DETERMINED THAT
THE HARNESSES SUPPLIED BY THE PROTESTER DID NOT MEET THE GOVERNMENT'S
MINIMUM NEEDS. INSPECTION REPORTS SHOWED THAT (1) THE HARNESSES ARE
DIFFICULT TO ADJUST BECAUSE THE STRAPS AT EACH BUCKLE LOCATION MUST BE
DOUBLE-LACED; (2) ONCE ADJUSTED, THE HARNESSES ARE EASILY LOOSENED AT
ALL BUCKLE LOCATIONS BECAUSE OF THE TYPE OF BUCKLE WEBBING THINNESS;
(3) THE HARNESS LEG STRAPS ARE SO SHORT THAT THEY ARE DIFFICULT TO
SECURE AND ARE SUSCEPTIBLE TO UNBUCKLING ONCE SECURED; AND (4) THE
SHOULDER STRAPS CAN FALL OFF THE WEARER'S SHOULDERS (THIS DEFICIENCY,
HOWEVER, ALREADY HAD BEEN REMEDIED BY A REVISION INCLUDED IN THE CURRENT
SPECIFICATIONS).
GENERALLY, THE USE OF INADEQUATE SPECIFICATIONS PROVIDES A SUFFICIENT
BASIS TO CANCEL AN INVITATION. DAR SEC. 2-404.1(B). SPECIFICATIONS ARE
INADEQUATE WHEN THEY DO NOT STATE THE GOVERNMENT'S ACTUAL NEEDS, KEMP
INDUSTRIES, INC., B-192301, OCTOBER 2, 1978, 78-2 CPD 248, AND OUR
OFFICE WILL DEFER TO THE TECHNICAL EXPERTISE OF AGENCY ENGINEERING
PERSONNEL IN DEFINING THE GOVERNMENT'S NEEDS, ESPECIALLY IN CASES
INVOLVING SAFETY EQUIPMENT. SEE OSHKOSH TRUCK CORPORATION, B-198521,
JULY 24, 1980, 80-2 CPD 161.
IT IS UNFORTUNATE THAT THE INADEQUACY IN THE SPECIFICATIONS HERE WAS
NOT DISCOVERED BEFORE BID OPENING, IN VIEW OF THE POTENTIAL FOR ADVERSE
IMPACT ON THE COMPETITIVE BIDDING SYSTEM WHEN A SOLICITATION IS CANCELED
AFTER BID PRICES HAVE BEEN EXPOSED. NONETHELESS, WE BELIEVE THE REPORTS
OF DESIGN DEFICIENCIES PROVIDED A REASONABLE BASIS FOR THE CONTRACTING
OFFICER'S DECISION.
KINGS POINT ARGUES THAT THE PROPOSED SPECIFICATION CHANGES ARE MINOR
AND THAT DGSC SHOULD PERMIT KINGS POINT TO MODIFY ITS PRODUCT TO COMPLY
WITH THE NEW REQUIREMENTS RATHER THAN CANCEL THE SOLICITATION. THE
TECHNICAL REPORTS SUBMITTED BY DGSC, HOWEVER, RECOMMEND THAT THE HARNESS
SPECIFICATIONS BE COMPLETELY REVISED TO INCLUDE GREATER DETAIL, AS IS
USED IN PARACHUTE HARNESS SPECIFICATIONS. THE SUGGESTED CHANGES WOULD
AFFECT THE DESIGN, MATERIALS AND HARDWARE TO BE USED, AND WE ARE
PERSUADED FROM THE EVIDENCE PRESENTED BY BOTH PARTIES THAT THE CHANGES
ARE SUBSTANTIAL AND WILL MATERIALLY AFFECT THE MANUFACTURE AND COST OF
THE END ITEM TO BE SUPPLIED. IN THE CIRCUMSTANCES, IT WOULD BE IMPROPER
FOR A CONTRACTING OFFICER TO NEGOTIATE A CHANGE IN THE SPECIFICATION
WITH THE LOW BIDDER. W.M.GRACE, INC., B-202842, AUGUST 11, 1981, 81-2
CPD 121.
THE PROTEST IS DENIED.
B-210756.2, APR 24, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO WILL NOT QUESTION THE CONTRACTING
OFFICER'S USE OF CARRIER SHIPPING RATES PROVIDED BY GOVERNMENT
TRANSPORTATION EXPERTS FOR PURPOSES OF EVALUATING TRANSPORTATION
COSTS ASSOCIATED WITH A SUPPLY CONTRACT, UNLESS IT IS SHOWN THAT
THE CONTRACTING OFFICER ACTED IN BAD FAITH.
2. IN JUDGING PROPOSALS, A CONTRACTING AGENCY
MAY NOT CONSIDER EVALUATION FACTORS WHICH WERE NOT INCLUDED IN THE
SOLICITATION'S EVALUATION CRITERIA.
3. AN ERRONEOUS TRANSCRIPTION OF AN OFFEROR'S
PRICES IN THE ABSTRACT OF PROPOSALS PROVIDES NO BASIS TO CHALLENGE
AN AWARD.
4. POST-AWARD PROTEST THAT THE AGENCY SHOULD
HAVE INCLUDED CERTAIN CLAUSES REGARDING THE EVALUATION OF
TRANSPORTATION COSTS IN THE SOLICITATION IS UNTIMELY SINCE ALLEGED
IMPROPRIETIES APPARENT PRIOR TO THE CLOSING DATE FOR SUBMISSION OF
PROPOSALS MUST BE FILED BEFORE THAT DATE.
YORK INDUSTRIES, INC.:
YORK INDUSTRIES, INC. PROTESTS THE AIR FORCE'S AWARD OF A
REQUIREMENTS CONTRACT TO HYDRAULICS INTERNATIONAL, INC. UNDER REQUEST
FOR PROPOSALS NO. F41608-82-R-1328 TO DESIGN AND SUPPLY CERTAIN AIRCRAFT
HYDRAULIC TEST STANDS.
WE DENY THE PROTEST IN PART AND DISMISS IT IN PART.
THE SOLICITATION CONTEMPLATED THE AWARD OF A MULTI-YEAR FIXED PRICE
CONTRACT BASED ON THE LOWEST EVALUATED TOTAL PRICE. SINCE THE
SOLICITATION PROVIDED FOR DELIVERY F.O.B. ORIGIN, THE LOWEST EVALUATED
PRICE WAS TO INCLUDE THE EVALUATION OF ESTIMATED TRANSPORTATION COSTS TO
BE BORNE BY THE GOVERNMENT. WHILE YORK OFFERED THE LOWEST TOTAL PRICE
FOR THE REQUIRED ITEMS, $6,392,325, AS COMPARED TO HYDRAULIC
INTERNATIONAL'S PRICE OF $6,406,577, THE ADDITION OF THE AIR FORCE'S
ESTIMATED TRANSPORTATION COSTS RESULTED IN HYDRAULICS INTERNATIONAL'S
EVALUATED TOTAL PRICE BEING LOWER THAN THE PROTESTER'S BY ALMOST $1,860.
I. ISSUES
THE PROTESTER BASICALLY CONTENDS THAT: A) THE AIR FORCE'S EVALUATION
OF TRANSPORTATION COSTS WAS IN ERROR; B) THE AIR FORCE IMPROPERLY
FAILED TO EVALUATE THE AWARDEE'S PRICE FOR PACKING ITEMS TO BE SHIPPED
OVERSEAS; C) THE AWARDEE'S OFFER DID NOT COMPLY WITH MATERIAL TERMS OF
THE SOLICITATION, AND D) THE SOLICITATION FAILED TO INCLUDE CERTAIN
MANDATORY CLAUSES REGARDING THE EVALUATION OF TRANSPORTATION COSTS.
II. DISCUSSION AND ANALYSIS
A. TRANSPORTATION COSTS
AFTER SEVERAL ROUNDS OF THE PROTESTER'S OBJECTING TO THE AIR FORCE'S
COMPUTATION OF TRANSPORTATION COSTS AND THE AIR FORCE SUBSEQUENTLY
RECALCULATING THE COSTS, THE AIR FORCE FINALLY FIXED THE TRANSPORTATION
COSTS OF THE PROTESTER'S OFFER AT $51,937.82 AND OF THE AWARDEE'S OFFER
AT $35,826.09. THE ONLY VARIABLES ACCOUNTING FOR THE DIFFERENCE IN
THOSE COSTS WERE THE MILEAGE FROM EACH OFFEROR'S PLACE OF SHIPMENT TO
KELLY AIR FORCE BASE, TEXAS, AND THE LOWEST AVAILABLE TRANSPORTATION
RATES BETWEEN THOSE POINTS. (THE SAME TRAILERS WERE AVAILABLE TO EACH
OFFEROR, AND THE AIR FORCE ASSUMED THE SAME WEIGHT AND DIMENSION FOR
EACH OFFEROR'S TEST STANDS SINCE THE STANDS HAD NOT BEEN DESIGNED YET.)
BASED ON INFORMATION OBTAINED FROM THE CONTRACTING ACTIVITY'S
TRANSPORTATION OFFICE, THE AIR FORCE DETERMINED THAT THE APPLICABLE
MILEAGE AND RATES WERE AS FOLLOWS:
YORK
MILEAGE 1618 (FROM MANCHESTER, PA.)
RATE 93 CENTS/MI.
HYDRAULIC INTERNATIONAL
MILEAGE 1342 (FROM CANOGA PARK, CA.)
RATE 77 CENTS/MI.
THE PROTESTER DISPUTES THE AIR FORCE'S DETERMINATIONS OF BOTH
VARIABLES. FIRST, THE PROTESTER CONTENDS THAT THE MILEAGE SHOULD BE
1617 FOR ITSELF AND 1367 FOR HYDRAULICS INTERNATIONAL (BASED ON A
HOUSEHOLD CARRIERS MILEAGE GUIDE EDITION ISSUED AFTER THE CLOSING DATE
FOR PROPOSALS - THE AIR FORCE USED THE LATEST EDITION PRIOR TO THAT
DATE). WE NEED NOT CONSIDER THIS MATTER, HOWEVER, SINCE THE MILEAGE
DISCREPANCY IS NOT ENOUGH TO AFFECT THE RELATIVE STANDING OF YORK AND
HYDRAULICS INTERNATIONAL.
SECOND, THE PROTESTER ARGUES THAT THE 77 CENT RATE FOR HYDRAULICS
INTERNATIONAL IN FACT WAS NOT APPROPRIATE BECAUSE THE RATE WAS BASED ON
THE SERVICES OF A CARRIER THAT ALLEGEDLY WAS FINANCIALLY UNABLE TO
FURNISH THEM. THE APPLICABLE RATE FOR THE EVALUATION OF HYDRAULICS
INTERNATIONAL'S TRANSPORTATION COSTS THEREFORE IS THE CRITICAL ISSUE
HERE.
THE CONTRACTING OFFICER DETERMINED THE RATES TO APPLY TO THE TWO
OFFERS BY QUESTIONING HIS TRANSPORTATION OFFICE PERSONNEL, WHO IN TURN
REQUESTED THE LOWEST APPLICABLE RATES FROM THE MILITARY TRAFFIC
MANAGEMENT COMMAND (MTMC) AS REQUIRED BY DEFENSE ACQUISITION REGULATION
(DAR) SEC. 19-301.1(A) (1976 ED.). THAT COMMAND ACTUALLY DETERMINED THE
APPLICABLE RATES.
OUR OFFICE HAS HELD THAT CONTRACTING OFFICERS, ACTING IN GOOD FAITH,
HAVE A RIGHT TO RELY ON THE INFORMATION PROVIDED BY TRANSPORTATION-RATE
SPECIALISTS. APPLIED OPTIC KINETICS, LTD., B-212332, FEBRUARY 7, 1984,
84-1 CPD 150; WILSON & HAYES, INC., B-206286, FEBRUARY 28, 1983, 83-1
CPD 191. NOTHING IN THE RECORD INDICATES THAT THE CONTRACTING OFFICER
ACTED IN OTHER THAN GOOD FAITH IN HIS ATTEMPTS TO ASCERTAIN THE
APPLICABLE RATES. HE REQUESTED THAT THE TRANSPORTATION OFFICE ADVISE
HIM OF THE APPLICABLE RATES, AND HE REPEATEDLY FORWARDED THE PROTESTER'S
OBJECTIONS TO THE TRANSPORTATION OFFICE WHICH THEN REQUESTED AND
RECEIVED THE NECESSARY INPUT FROM MTMC.
MOREOVER, IT APPEARS THAT MTMC PROVIDED THE CORRECT LOWEST AVAILABLE
RATE FOR THE EVALUATION OF HYDRAULICS INTERNATIONAL'S OFFER. WE
CONTACTED MTMC AND WERE ADVISED THAT WHILE THE CARRIER DID GO OUT OF
BUSINESS AND CEASE PROVIDING TRANSPORTATION SERVICES SEVERAL MONTHS
AFTER THE CLOSING DATE FOR THE RECEIPT OF PROPOSALS AND AFTER THE DATE
OF AWARD, THE CARRIER WAS STILL PROVIDING SUCH SERVICES WHEN THE AIR
FORCE EVALUATED TRANSPORTATION COSTS AND FOR SOME PERIOD AFTER THE
AWARD. DURING THIS TIME, THE CARRIER WAS ELIGIBLE FOR GOVERNMENT
SHIPMENTS; ALTHOUGH SUBSEQUENT TO THE AWARD THE CARRIER WAS PLACED ON
PROBATION, THIS ACTION STILL DID NOT MAKE THE CARRIER INELIGIBLE FOR
GOVERNMENT SHIPMENTS. THUS, THE CONTRACTING OFFICER IN FACT USED A
VIABLE RATE WHEN COMPUTING THE TRANSPORTATION COSTS APPLICABLE TO
HYDRAULICS INTERNATIONAL'S OFFER.
THE PROTEST ON THIS ISSUE IS DENIED.
B. FAILURE TO EVALUATE PACKING PRICE
THE SOLICITATION CONTAINED A CLAUSE THAT INCLUDED THE FOLLOWING:
"... OFFEROR MAY SET FORTH IN THE SPACE
PROVIDED BELOW AN AMOUNT WHICH REPRESENTS
THE UNIT PRICE DIFFERENTIAL BETWEEN
PREPARATION FOR DOMESTIC SHIPMENTS AND
PREPARATION FOR OVERSEAS SHIPMENTS WHICH
SHALL BE ADDED TO THE UNIT PRICES SET FORTH
FOR ITEMS ABOVE WHEN ORDERED.
"IF THE OFFEROR FAILS TO SET FORTH AN AMOUNT
BELOW, THE GOVERNMENT SHALL ASSUME THERE ARE
NO ADDITIONAL CHARGES."
HYDRAULICS INTERNATIONAL'S OFFER INCLUDED AN AMOUNT OF $930 IN THE
SPACE PROVIDED, WHILE YORK LEFT THE SPACE BLANK. THE ABSTRACT OF
PROPOSALS PREPARED BY THE CONTRACTING OFFICER CONTAINS AN ESTIMATED COST
OF HYDRAULIC INTERNATIONAL'S OFFER THAT INCLUDES $2,790 FOR SUCH PACKING
(THUS INDICATING THAT THE AIR FORCE ANTICIPATED SHIPPING THREE UNITS
OVERSEAS).
THE PROTESTER CONTENDS THAT THIS AMOUNT SHOULD HAVE BEEN INCLUDED IN
THE EVALUATION OF THE AWARDEE'S TOTAL PRICE, AND POINTS OUT THAT THE
ADDITION OF THIS AMOUNT TO HYDRAULICS INTERNATIONAL'S EVALUATED TOTAL
PRICE WOULD HAVE RESULTED IN YORK BEING THE LOWEST-PRICED OFFEROR. THE
AIR FORCE RESPONDS THAT IT DID NOT EVALUATE THE PACKING PRICE BECAUSE
THE PRICE WAS NOT LISTED AS AN EVALUATION FACTOR IN THE SOLICITATION'S
"EVALUATION FACTORS FOR AWARD" SECTION, WHICH PROVIDED A PRECISE FORMULA
FOR DETERMINING THE LOWEST EVALUATED TOTAL PRICE. IN FACT, PRIOR TO THE
SUBMISSION OF PROPOSALS, THE AIR FORCE AMENDED THE SOLICITATION TO
EXCLUDE A PROVISION THAT EXPRESSLY PROVIDED FOR THE EVALUATION OF
PACKING PRICES; THE PROVISION STATED THAT THE LOWEST EVALUATED TOTAL
PRICE WOULD INCLUDE "THE UNIT PRICE DIFFERENTIALS OFFERED ... MULTIPLIED
BY THE ESTIMATED QUANTITY THAT MAY BE ORDERED THAT MAY REQUIRE LEVEL A
PACKING FOR OVERSEAS SHIPMENTS."
IT IS A FUNDAMENTAL PRINCIPLE OF FEDERAL PROCUREMENT LAW THAT WHILE
PROCURING AGENCIES HAVE BROAD DISCRETION IN DETERMINING THE EVALUATION
PLAN THEY WILL USE, THEY DO NOT HAVE THE DISCRETION TO ANNOUNCE IN THE
SOLICITATION THAT ONE PLAN WILL BE USED AND THEN FOLLOW ANOTHER IN THE
ACTUAL EVALUATION. ONCE OFFERORS ARE INFORMED OF THE CRITERIA AGAINST
WHICH THEIR PROPOSALS WILL BE EVALUATED, THE AGENCY MUST ADHERE TO THOSE
CRITERIA OR INFORM ALL OFFERORS OF ANY SIGNIFICANT CHANGES AND GIVE THEM
AN OPPORTUNITY TO REVISE THEIR OFFERS. VIBRA-TECH ENGINEERS
INCORPORATED, B-209541.2, MAY 23, 1983, 83-1 CPD 550. SINCE THE
SOLICITATION'S EVALUATION FACTORS DID NOT INCLUDE THE PACKING PRICE AS
AN EVALUATION FACTOR, THE AIR FORCE PROPERLY DID NOT INCLUDE THAT PRICE
IN ITS EVALUATION OF THE AWARDEE'S TOTAL PRICE FOR THE PURPOSE OF
SELECTING THE CONTRACTOR. SEE WILD HEERBRUGG INSTRUMENTS, INC.,
B-210092, SEPTEMBER 2, 1983, 83-2 CPD 295 (CONCERNING THE AGENCY'S
FAILURE TO EVALUATE LIFE-CYCLE COSTS).
TO THE EXTENT THAT THE PROTESTER CONTENDS THAT THE AIR FORCE SHOULD
HAVE INCLUDED PACKING PRICES IN THE SOLICITATION'S LISTED EVALUATION
FACTORS, THE PROTEST IS UNTIMELY. SEE WILD HEERBRUGG INSTRUMENTS, INC.,
SUPRA. THE CONTENTION INVOLVES AN ALLEGED APPARENT SOLICITATION
IMPROPRIETY WHICH, UNDER OUR BID PROTEST PROCEDURES, HAD TO BE PROTESTED
EITHER HERE OR WITH THE CONTRACTING AGENCY PRIOR TO THE CLOSING DATE FOR
THE RECEIPT OF PROPOSALS. 4 C.F.R. SEC. 21.2(B)(1) (1983). SINCE YORK
DID NOT FILE ITS INITIAL PROTEST UNTIL AFTER THE AWARD, THE PROTEST ON
THIS ISSUE CLEARLY IS UNTIMELY.
WE THEREFORE DENY THIS ASPECT OF THE PROTEST IN PART AND DISMISS IT
IN PART.
WE ARE CONCERNED, HOWEVER, AS TO WHY THE AIR FORCE CHOSE NOT TO
EVALUATE THE PACKING COST, SINCE THE BASIS FOR AWARD WAS PRICE, UNDER
THE SOLICITATION OVERSEAS PACKING COULD BE A SEPARATELY-PRICED ITEM, AND
IT IS APPARENT THAT THE AGENCY ANTICIPATED SHIPPING THREE UNITS
OVERSEAS. WE ARE RECOMMENDING THAT THE AIR FORCE, IN FUTURE
SOLICITATIONS OF THIS SORT, CONSIDER INCLUDING THIS ITEM AS AN
EVALUATION FACTOR WHERE THE GOVERNMENT WILL BE BEARING THE COST OF
OVERSEAS PACKING.
C. AWARDEE'S COMPLIANCE WITH THE SOLICITATION
THE PROTESTER POINTS OUT THAT THE CONTRACTING OFFICER'S ABSTRACT OF
PROPOSALS FURNISHED TO YORK LISTS $33,549 AS HYDRAULICS INTERNATIONAL'S
OFFERED PRICE FOR EACH ADDITIONAL TEST STAND UNIT ABOVE THE BEST
ESTIMATED QUANTITY (BEQ) CONTAINED IN THE SOLICITATION, AND LISTS
$32,539 FOR EACH UNIT WITHIN THE BEQ. THE SOLICITATION, HOWEVER,
EXPLICITLY STIPULATED THAT THE FORMER PRICE COULD NOT BE MORE THAN THE
PRICE FOR THE BEQ. THE PROTESTER THEREFORE CONTENDS THAT HYDRAULIC'S
OFFER WAS UNACCEPTABLE.
THE SIMPLE ANSWER TO THIS ASPECT OF THE PROTEST IS THAT THE ABSTRACT
OF PROPOSALS CONTAINS A TRANSCRIPTION ERROR, SINCE THE AWARDEE'S BEST
AND FINAL OFFER, TIMELY RECEIVED BY THE CONTRACTING OFFICER, LISTS A
PRICE OF $32,439 FOR EACH UNIT ABOVE THE BEQ, WHICH PRICE IS LOWER THAN
THE UNIT PRICE FOR THE BEQ. SINCE THERE IS NO OTHER AFFIRMATIVE
EVIDENCE THAT THE AWARDEE'S BEST AND FINAL OFFER DID NOT COMPLY WITH
MATERIAL TERMS OF THE SOLICITATION, WE DENY THIS ASPECT OF THE PROTEST.
SEE GEORGE C. MARTIN, INC., 55 COMP.GEN. 100 (1975), 75-2 CPD 55.
D. SOLICITATION'S FAILURE TO INCLUDE MANDATORY CLAUSES
THE PROTESTER CONTENDS THAT THE AIR FORCE OMITTED FROM THE
SOLICITATION CERTAIN CLAUSES PERTAINING TO THE EVALUATION OF
TRANSPORTATION COSTS THAT THE DAR REQUIRED TO BE INCLUDED. LIKE THE
COMPLAINT THAT THE SOLICITATION DID NOT INCLUDE PACKING PRICES AS AN
EVALUATION FACTOR, THIS ISSUE INVOLVES AN ALLEGED IMPROPRIETY APPARENT
FROM THE SOLICITATION THAT THE PROTESTER FAILED TO PROTEST IN A TIMELY
MANNER, THAT IS, PRIOR TO THE CLOSING DATE FOR THE RECEIPT OF PROPOSALS.
4 C.F.R. SEC. 21.2(B)(1). WE THEREFORE DISMISS THIS PROTEST GROUND.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
B-210756, FEB 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST CHALLENGING RESPONSIBILITY OF AWARDEE IS DISMISSED BECAUSE
GAO DOES NOT REVIEW AFFIRMATIVE DETERMINATIONS OF RESPONSIBILITY EXCEPT
IN CIRCUMSTANCES NOT APPLICABLE HERE.
JANKE & COMPANY, INC.:
JANKE & COMPANY, INC. (JANKE) PROTESTS AWARD OF A CONTRACT UNDER
SOLICITATION NO. F41608-82-R-1328 BY THE AIR FORCE TO HYDRAULICS
INTERNATIONAL, INC. (HYDRAULICS). THE CONTRACT IS FOR THE FABRICATING
OF TRIPLE TEST STANDS. WE DISMISS THE PROTEST.
JANKE MAINTAINS THAT HYDRAULICS DOES NOT SATISFY THE MINIMUM
RESPONSIBILITY STANDARDS SET FORTH IN DEFENSE ACQUISITION REGULATION
SECS. 1-903.1 AND 1-903.2 (1976 ED.). JANKE CONTENDS THAT HYDRAULICS
DOES NOT HAVE THE "PHYSICAL CAPABILITY" TO PERFORM THE CONTRACT BECAUSE
OF THE SIZE OF ITS PLANT AND ITS CURRENT WORK LOAD.
PRIOR TO AWARDING A CONTRACT TO HYDRAULICS, THE CONTRACTING OFFICER
MUST DETERMINE THAT THE COMPANY IS A RESPONSIBLE PROSPECTIVE CONTRACTOR,
THAT IS, THAT IT HAS THE CAPACITY TO PERFORM. BECAUSE SUCH A
DETERMINATION INVOLVES WHAT IS ESSENTIALLY A BUSINESS JUDGMENT, OUR
OFFICE DOES NOT REVIEW AFFIRMATIVE DETERMINATIONS OF RESPONSIBILITY
UNLESS THERE IS A SHOWING OF POSSIBLE FRAUD ON THE PART OF THE PROCURING
OFFICIALS OR THE SOLICITATION CONTAINS DEFINITIVE RESPONSIBILITY
CRITERIA WHICH ALLEGEDLY HAVE NOT BEEN APPLIED. BEACON WINCH COMPANY,
B-206513.2, MAY 18, 1982, 82-1 CPD 478. NEITHER CASE APPLIES HERE.
ACCORDINGLY, JANKE'S PROTEST IS DISMISSED.
B-210755, MAY 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
EMPLOYEE ON EXTENDED TEMPORARY ASSIGNMENT LODGED IN A CAMP WHICH HE
OWNED AND CLAIMED TO HOLD AS RENTAL PROPERTY. FOR THE ENTIRE PERIOD OF
HIS TEMPORARY ASSIGNMENT, HE CLAIMS PER DIEM FOR LODGING IN AN AMOUNT
WHICH HE SAYS IS THE MINIMUM FOR WHICH HE WOULD HAVE RENTED HIS CAMP TO
SPORTSMEN ON A DAILY BASIS. PAYMENT OF HIS CLAIM MAY NOT BE AUTHORIZED
IN THE ABSENCE OF CLEAR AND CONVINCING EVIDENCE THAT THE LODGING WOULD
HAVE BEEN RENTED DURING THE ENTIRE PERIOD COVERED BY HIS CLAIM, AND THEN
ONLY FOR EXPENSES OCCASIONED BY HIS TEMPORARY ASSIGNMENT.
RODNEY J. GARDNER:
THIS ACTION RESPONDS TO A REQUEST FOR AN ADVANCE DECISION AS TO
WHETHER PAYMENT MAY BE MADE ON THE CLAIM OF MR. RODNEY GARDNER, A
CIVILIAN EMPLOYEE OF THE ARMY CORPS OF ENGINEERS, FOR PAYMENT OF PER
DIEM FOR LODGING ON ACCOUNT OF HIS HAVING RESIDED IN HIS PRIVATE CAMP
DURING A TEMPORARY DUTY ASSIGNMENT. WE FIND THAT THE CLAIM MAY NOT BE
PAID ON THE BASIS OF THE PRESENT RECORD.
MR. GARDNER'S PERMANENT DUTY STATION IS AT WALTHAM, MASSACHUSETTS,
AND HIS PERMANENT RESIDENCE IS LOCATED IN TOPSHAM, MAINE. HE WAS
ASSIGNED TO TEMPORARY DUTY IN ALLAGASH, MAINE, FROM APRIL 26 TO NOVEMBER
23, 1977. HIS TRAVEL ORDER AUTHORIZED PER DIEM IN ACCORDANCE WITH THE
JOINT TRAVEL REGULATIONS. MR. GARDNER STATES THAT DURING THIS TEMPORARY
ASSIGNMENT HE RESIDED AT A CAMP HE OWNS IN ALLAGASH, AND THAT DURING THE
PERIOD OF HIS TEMPORARY ASSIGNMENT, HIS CAMP WOULD OTHERWISE HAVE BEEN
RENTED TO SPORTSMEN FOR FISHING AND HUNTING AT A RATE OF NOT LESS THAN
$16 PER DAY. HE EXPLAINS THAT SINCE THE MOTEL AND RESTAURANT NEAREST TO
THE JOB SITE WERE 30 MILES AWAY AT FORT KENT, MAINE, IT WOULD COST THE
GOVERNMENT LESS TO PAY HIM TO RESIDE IN HIS OWN CAMP AT A RATE OF $16
PER DAY THAN FOR HIM TO COMMUTE 60 MILES ROUND TRIP EVERY DAY AND TAKE
MEALS AND LODGING IN COMMERCIAL ESTABLISHMENTS. HE, THEREFORE, CLAIMS
AS LODGING COSTS A TOTAL OF $3,312, AT A RATE OF $16 PER DAY.
CITING COMPTROLLER GENERAL DECISION, MATTER OF SILVER, 56 COMP.GEN.
223 (1977), THE ARMY CORPS OF ENGINEERS DENIED MR. GARDNER'S CLAIM FOR
LODGING ON THE BASIS THAT SINCE HE LODGED AT HIS OWN CAMP WHICH WAS NOT
PURCHASED AND MAINTAINED ON ACCOUNT OF HIS TEMPORARY DUTY ASSIGNMENT, HE
WAS NOT REQUIRED TO PAY FOR LODGING. THE CORPS FURTHER STATED THAT PER
DIEM IS DESIGNED TO REIMBURSE THE TRAVELER FOR ALLOWABLE EXPENSES
INCURRED IN THE PERFORMANCE OF OFFICIAL DUTY AWAY FROM HIS PERMANENT
DUTY STATION, AND NOT TO CONFER UPON HIM A GRATUITY OR TO REIMBURSE HIM
FOR ALLEGEDLY LOST INCOME.
PER DIEM ALLOWANCES ARE AUTHORIZED BY THE PROVISIONS OF 5 U.S.C.
SEC. 5702, FOR EMPLOYEES TRAVELING ON OFFICIAL BUSINESS. THE STATUTORY
PROVISIONS ARE IMPLEMENTED BY CHAPTER 1, PARAGRAPH 7, OF THE FEDERAL
TRAVEL REGULATIONS (FPMR 101-7, IN EFFECT AT THE TIME THIS CLAIM
ACCRUED). THE APPLICABLE REGULATIONS PROVIDED THAT PER DIEM SHALL BE
ESTABLISHED ON THE BASIS OF THE AMOUNT OF EXPENSES THE TRAVELER ACTUALLY
INCURS FOR LODGING. FEDERAL TRAVEL REGULATIONS, PARAGRAPH 1-7.3C(1) AND
(2).
IN MATTER OF SILVER, CITED ABOVE, WE HELD THAT AN EMPLOYEE WHO LODGED
IN ONE OF HIS TWO FAMILY RESIDENCES WHILE ON A TEMPORARY DUTY ASSIGNMENT
WAS NOT ENTITLED TO PRORATED MORTGAGE, UTILITY, AND MAINTENANCE EXPENSES
AS LODGING COSTS. THAT HOLDING IS BASED ON THE FACT THAT THE EMPLOYEE
DID NOT INCUR THE CLAIMED EXPENSES INCIDENT TO HIS TRAVEL SINCE HE WAS
OBLIGATED TO PAY THESE COSTS REGARDLESS OF HIS TEMPORARY DUTY
ASSIGNMENT.
IN SOME INSTANCES, WE HAVE HELD THAT AN EMPLOYEE WHO, WHILE ON
TEMPORARY DUTY, LODGES IN A RESIDENCE WHICH HE OWNS AND HOLDS AS RENTAL
PROPERTY, OR WHICH HE ACQUIRED INCIDENT TO A TEMPORARY ASSIGNMENT, MAY
BE PAID LODGING EXPENSES BASED ON PRORATED MONTHLY INTEREST, TAXES, AND
UTILITIES AS COSTS OCCASIONED BY THE TEMPORARY ASSIGNMENT. SEE, FOR
EXAMPLE, MATTER OF LARRABEE, 57 COMP.GEN. 147 (1977). HOWEVER, WHERE AN
EMPLOYEE CLAIMS SUCH EXPENSES ON ACCOUNT OF HAVING LODGED IN RENTAL
PROPERTY WHICH HE OWNS, HE MUST PROVIDE CLEAR AND CONVINCING EVIDENCE
THAT BUT FOR HIS LODGING THERE WHILE ON TEMPORARY DUTY, THE RESIDENCE
WOULD HAVE BEEN RENTED OUT AT ALL TIMES COVERED BY HIS CLAIM. MATTER OF
STATON, B-201574, AUGUST 24, 1981.
IN THIS CASE THE RECORD CONTAINS NO SUCH EVIDENCE. ALTHOUGH THE
MEMORANDUM OF THE FINANCE AND ACCOUNTING OFFICER TO THE ARMY DEPARTMENT
HEADQUARTERS, DATED AUGUST 29, 1980, MENTIONS A STATEMENT WHICH MR.
GARDNER APPARENTLY PROVIDED WITH HIS RECLAIM VOUCHER "INDICATING THAT
HIS CAMP IS LICENSED WITH THE STATE OF MAINE FOR RENTAL PURPOSES," THAT
INFORMATION HAS NOT BEEN SUBMITTED TO THIS OFFICE. MOREOVER, THAT
STATEMENT OR EVIDENCE OF THAT FACT ALONE WOULD NOT CONSTITUTE SUFFICIENT
EVIDENCE TO SUPPORT A CONCLUSION THAT THE QUARTERS WOULD HAVE BEEN
RENTED AS CLAIMED THROUGHOUT THE ENTIRE PERIOD OF MR. GARDNER'S
TEMPORARY DUTY ASSIGNMENT.
ACCORDINGLY, ON THE BASIS OF THE RECORD BEFORE US MR. GARDNER'S CLAIM
MAY NOT BE PAID. IF, HOWEVER, HE PROVIDES THE CORPS OF ENGINEERS WITH
RECORDS SHOWING THAT THE PROPERTY IS HELD AND USED AS A RENTAL PROPERTY
AND WOULD HAVE BEEN RENTED DURING THE ENTIRE PERIOD, HIS CLAIM FOR
LODGING EXPENSES OCCASIONED BY HIS TEMPORARY ASSIGNMENT MAY BE
CONSIDERED FOR PAYMENT. HOWEVER, THE BASIS FOR COMPUTING THESE COSTS IS
NOT THE RENTAL PRICE OF THE PROPERTY, BUT RATHER A PRORATION OF HIS
MONTHLY INTEREST, TAXES, AND UTILITIES PAID BY THE EMPLOYEE FOR THE
RENTAL PROPERTY IN QUESTION. SEE MATTER OF LARRABEE, 57 COMP.GEN. 147
(1977).
B-210754.3, SEP 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE GAO IS NOTIFIED THAT PROTESTER SEEKS
RECONSIDERATION BUT PROTESTER FAILS TO FURNISH
FACTUAL OR LEGAL BASIS FOR REQUESTING
RECONSIDERATION WITHIN 10 WORKING DAYS AFTER
RECEIPT OF GAO DECISION, THE REQUEST FOR
RECONSIDERATION IS DISMISSED AS UNTIMELY.
B&L TURBINE & PUMP REPAIRS, INC. - RECONSIDERATION:
B&L TURBINE & PUMP REPAIRS, INC. (B&L), BY TWX DATED AUGUST 18, 1983,
ACKNOWLEDGED RECEIPT OF OUR DECISION, B&L TURBINE & PUMP REPAIRS, INC.,
B-210754.2, AUGUST 16, 1983, 83-2 CPD . B&L REQUESTED RECONSIDERATION
OF OUR DECISION SUMMARILY DENYING B&L'S PROTEST AND STATED THAT COMPLETE
DOCUMENTATION WOULD FOLLOW.
B&L HAS NOT SUBMITTED THE PROMISED DOCUMENTATION. SINCE THE FACTUAL
OR LEGAL BASIS FOR SEEKING RECONSIDERATION WAS NOT FILED WITHIN 10
WORKING DAYS AFTER RECEIPT OF OUR DECISION, THE REQUEST FOR
RECONSIDERATION IS UNTIMELY AND IS ACCORDINGLY DISMISSED. LEWIS
MANAGEMENT AND SERVICE COMPANY - RECONSIDERATION, B-192078, JANUARY 18,
1979, 79-1 CPD 29.
B-210754.2, AUG 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROCURING AGENCY IS UNDER NO LEGAL
OBLIGATION TO REQUEST SBA TO RECONSIDER
ITS DECLINATION TO ISSUE A COC TO A
SMALL BUSINESS FIRM AFTER RECEIPT OF NEW
INFORMATION WHERE CONTRACTING OFFICER
HAS RECONSIDERED NONRESPONSIBILITY
DETERMINATION IN LIGHT OF NEW INFORMATION
PRESENTED AND DETERMINES THAT SMALL
BUSINESS FIRM REMAINS NONRESPONSIBLE.
B&L TURBINE & PUMP REPAIRS, INC.:
B&L TURBINE & PUMP REPAIRS, INC. (B&L), PROTESTS THE NAVY'S FAILURE
TO SEEK A SECOND SMALL BUSINESS ADMINISTRATION (SBA) CERTIFICATE OF
COMPETENCY (COC) REVIEW FOLLOWING B&L'S SUBMISSION OF NEW INFORMATION
WHICH SBA HAD NOT CONSIDERED IN THE COURSE OF ITS FIRST COC REVIEW OF
B&L'S RESPONSIBILITY AS A PROSPECTIVE CONTRACTOR UNDER SOLICITATIONS
N00102-83-R-0609 AND N00102-83-R-0610, ISSUED BY THE PORTSMOUTH NAVAL
SHIPYARD, PORTSMOUTH, NEW HAMPSHIRE.
THE NAVY HAS ADVISED US THAT ON JULY 7, 1983, FOLLOWING RECEIPT OF
B&L'S SUBMISSION OF NEW INFORMATION, THE CONTRACTING OFFICER
RECONSIDERED THE NONRESPONSIBILITY DETERMINATION AND FOUND THAT B&L
REMAINED NONRESPONSIBLE. WE HAVE HELD THAT IN SUCH CIRCUMSTANCES THERE
IS NO LEGAL OBLIGATION FOR THE AGENCY TO REQUEST SBA RECONSIDERATION OF
ITS DECLINATION TO ISSUE A COC. REUBEN GARMENT INTERNATIONAL CO., INC.,
B-198923, SEPTEMBER 11, 1980, 80-2 CPD 191.
ACCORDINGLY, THE PROTEST IS CLEARLY WITHOUT LEGAL MERIT AND IS
SUMMARILY DENIED WITHOUT AWAITING A REPORT FROM THE NAVY. 4 C.F.R.
SEC. 21.3(G) (1983), AS AMENDED BY 48 FED.REG. 1931 (1983).
B-210750.2, OCT 20, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
BID, SUBMITTED IN RESPONSE TO TOTAL SMALL BUSINESS
SET-ASIDE SOLICITATION, WHICH FAILED TO INDICATE
WHETHER BIDDER WOULD FURNISH MATERIALS MANUFACTURED
OR PRODUCED BY SMALL BUSINESS CONCERNS WAS
PROPERLY REJECTED AS NONRESPONSIVE; FAILURE MAY
NOT BE WAIVED OR CURED.
MECHANICAL MIRROR WORKS, INC:
MECHANICAL MIRROR WORKS, INC. (MECHANICAL), PROTESTS THE REJECTION OF
ITS LOW BID ON ITEM NO. 7 UNDER GENERAL SERVICES ADMINISTRATION (GSA)
INVITATION FOR BIDS NO. YNPF4-1365-A-2-28-83, A TOTAL SMALL BUSINESS
SET-ASIDE.
WE DENY THE PROTEST.
EACH BIDDER WAS REQUIRED TO CERTIFY IN PARAGRAPH 1, "SMALL BUSINESS,"
OF INVITATION FORM 33 ("REPRESENTATIONS, CERTIFICATIONS AND
ACKNOWLEDGMENTS") THAT IT:
". . .() IS, () IS NOT, A SMALL BUSINESS
CONCERN. IF OFFEROR IS A SMALL BUSINESS CONCERN
AND IS NOT THE MANUFACTURER OF THE SUPPLIES
OFFERED, HE ALSO REPRESENTS THAT ALL SUPPLIES TO
BE FURNISHED HEREUNDER () WILL, () WILL NOT, BE
MANUFACTURED OR PRODUCED BY A SMALL BUSINESS
CONCERN . . . ."
IN PARAGRAPH 3, "REGULAR DEALER - MANUFACTURER," OF THE SAME FORM A
BIDDER WAS REQUIRED TO INDICATE IF "HE IS A () REGULAR DEALER IN ()
MANUFACTURER OF, THE SUPPLIES OFFERED." IN INVITATION PROVISION 514
("PRODUCTION AND INSPECTION POINTS"), AT PAGE 13 OF THE INVITATION, A
BIDDER WAS TO:
". . . INSERT, IN THE APPROPRIATE SPACES PROVIDED
BELOW, THE NAMES OF THE MANUFACTURERS OF THE
ITEMS OFFERED AND THE ADDRESS, TELEPHONE NUMBER,
AND DUNS NUMBER OF THE FACILITY(IES) AT WHICH THE
ITEMS WILL BE MANUFACTURED OR PRODUCED."
MECHANICAL MADE NONE OF THESE REQUIRED INSERTIONS.
THE CONTRACTING AGENCY REJECTED THE MECHANICAL BID AS NONRESPONSIVE
UNDER SECTION 1-1.703-1(C)(3) (1964 ED.AMEND. 206) OF THE FEDERAL
PROCUREMENT REGULATIONS, WHICH STATES THAT A BIDDER SHALL NOT BE
CONSIDERED FOR AN AWARD AS A SMALL BUSINESS CONCERN UNLESS HE HAS
REPRESENTED IN GOOD FAITH THAT HE WAS A SMALL BUSINESS CONCERN AT THE
TIME OF BID OPENING. THE CONTRACTING AGENCY STATES THAT AT THE TIME THE
MECHANICAL BID WAS SUBMITTED, AND AT THE TIME OF BID OPENING, THERE WAS
NO INDICATION THAT MECHANICAL WAS A SMALL BUSINESS CONCERN. THE GSA
OFFICE OF GENERAL COUNSEL ALSO NOTES THAT THE MECHANICAL BID WAS
NONRESPONSIVE BECAUSE A BIDDER MUST ESTABLISH IN ITS BID - AND
MECHANICAL DID NOT - THAT IT WILL FURNISH ONLY PRODUCTS MANUFACTURED OR
PRODUCED BY SMALL BUSINESS CONCERNS.
IT IS THE CONTENTION OF MECHANICAL THAT ITS BID IS RESPONSIVE
INASMUCH AS MINOR INFORMALITIES OR IRREGULARITIES IN A BID - AS ARE
ALLEGEDLY INVOLVED IN THE MECHANICAL BID - MAY BE CORRECTED. MECHANICAL
CITES OUR DECISION IN B-161641, OCTOBER 31, 1967, THAT THE FAILURE OF A
BIDDER TO STATE IN ITS BID WHETHER OR NOT IT IS A SMALL BUSINESS MAY BE
WAIVED WHEN THE CONTRACTING OFFICER IS ABLE TO MAKE AN INDEPENDENT
DETERMINATION THAT THE BIDDER IS IN EFFECT A SMALL BUSINESS. MECHANICAL
STATES THAT ON MARCH 29, 1983, THE SMALL BUSINESS ADMINISTRATION (SBA)
CERTIFIED MECHANICAL AS A SMALL BUSINESS TO GSA ON A PROCUREMENT OF THE
SAME ITEM BEING PROCURED HERE. THUS, THE CONTRACTING AGENCY SHOULD HAVE
KNOWN OF THE SMALL BUSINESS STATUS OF MECHANICAL. FURTHER, AS REGARDS
THE REQUIREMENT THAT A BIDDER CERTIFY WHETHER OR NOT IT IS A SMALL
BUSINESS, MECHANICAL NOTES THAT IN OUR DECISION IN JIMMY'S APPLIANCE,
B-205611, JUNE 7, 1982, 82-1 CPD 542, WE STATED THAT THE MISTAKEN
CERTIFICATION BY A BIDDER THAT IT WAS A LARGE RATHER THAN A SMALL
BUSINESS DID NOT RENDER THE BID NONRESPONSIVE AND THE QUESTION OF THE
BIDDER'S STATUS COULD BE REFERRED TO THE SBA. MECHANICAL ALSO NOTES,
CITING OUR DECISION IN B-168881, MARCH 31, 1970, THAT WE HAVE HELD THAT
A BIDDER'S FAILURE TO INDICATE IN ITS BID ITS STATUS AS A MANUFACTURER
OF THE ITEMS BEING PROCURED OR THE SOURCE OF THESE ITEMS MAY BE WAIVED
SINCE THE OMISSIONS ARE ONLY MINOR DEFICIENCIES. IN VIEW OF THESE
CASES, MECHANICAL BELIEVES THAT THE CONTRACTING OFFICER SHOULD HAVE
ALLOWED MECHANICAL TO SUPPLY THE NECESSARY INFORMATION AFTER BID
OPENING.
WE DISAGREE. IN NONE OF THE CASES CITED BY MECHANICAL DID WE HOLD
THAT THE FAILURE OF A BIDDER TO CERTIFY THAT THE ITEMS TO BE SUPPLIED
WOULD BE MANUFACTURED OR PRODUCED BY A SMALL BUSINESS CONCERN COULD BE
WAIVED OR CORRECTED AS A MINOR INFORMALITY/IRREGULARITY. OUR RULE IN
SUCH A CASE HAS BEEN CONSISTENTLY THAT WHERE A BID ON A TOTAL SMALL
BUSINESS SET-ASIDE FAILS TO ESTABLISH THE INTENTION OF THE BIDDER TO
FURNISH PRODUCTS MANUFACTURED OR PRODUCED BY SMALL BUSINESS CONCERNS,
THE BID IS NONRESPONSIVE AND MAY NOT BE CONSIDERED FOR AWARD. CULLIGAN,
INC., 58 COMP.GEN. 307 (1979), 79-1 CPD 149; DAYTON CHEMICAL
CORPORATION, B-200122, MAY 13, 1981, 81-1 CPD 373; PARCO, A DIVISION OF
BLUE MOUNTAIN PRODUCTS, INC., B-211016, MARCH 28, 1983, 83-1 CPD 318.
JIMMY'S APPLIANCE, SUPRA, INVOLVED A SERVICE CONTRACT, NOT A SUPPLY
CONTRACT AS HERE, AND THERE WAS NO REQUIREMENT THAT BIDDERS OBLIGATE
THEMSELVES TO SUPPLY ITEMS MANUFACTURED BY A SMALL BUSINESS. A BIDDER
MUST BIND ITSELF IN ITS BID TO MEET THIS OBLIGATION OR THE BID WILL BE
RENDERED NONRESPONSIVE. MECHANICAL DID NOT STATE IN ITS BID THAT IT WAS
THE MANUFACTURER OF THE ITEMS OR THAT THE ITEMS WOULD BE MANUFACTURED BY
A SMALL BUSINESS. MOREOVER, WHILE GSA MAY HAVE KNOWN MECHANICAL WAS A
SMALL BUSINESS FROM THE PRIOR CERTIFICATION, GSA HAD NO WAY OF KNOWING
WHERE MECHANICAL INTENDED TO OBTAIN THE SUPPLIES, ABSENT THE LISTING OF
THE MANUFACTURER.
WHILE WE HAVE PERMITTED THE ACCEPTANCE OF A BID WHERE THE BIDDER HAD
NEGLECTED TO INCLUDE THIS CERTIFICATION IN ITS BID, THERE WAS
INFORMATION IN THE BID AS SUBMITTED WHICH MADE IT POSSIBLE TO ASCERTAIN
THE BIDDER'S INTENTION TO SUPPLY PRODUCTS MANUFACTURED OR PRODUCED BY
SMALL BUSINESS CONCERNS. B-156852, JUNE 9, 1965. HOWEVER, INFORMATION
OUTSIDE OF THE BID ITSELF MAY NOT BE PROVIDED BY THE BIDDER AFTER BID
OPENING SO AS TO CURE THE FAILURE TO MAKE THIS CERTIFICATION IN THE BID.
TO PERMIT A BIDDER TO MAKE ITS NONRESPONSIVE BID RESPONSIVE AFTER BID
OPENING WOULD BE TANTAMOUNT TO PERMITTING IT TO SUBMIT A NEW BID, AND
THIS MAY NOT BE PERMITTED. JACK YOUNG ASSOCIATES, INC., B-195531,
SEPTEMBER 20, 1979, 79-2 CPD 207.
THE PROTEST IS DENIED.
B-210750.2, OCT 20, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
BID, SUBMITTED IN RESPONSE TO TOTAL SMALL BUSINESS
SET-ASIDE SOLICITATION, WHICH FAILED TO INDICATE
WHETHER BIDDER WOULD FURNISH MATERIALS MANUFACTURED
OR PRODUCED BY SMALL BUSINESS CONCERNS WAS
PROPERLY REJECTED AS NONRESPONSIVE; FAILURE MAY
NOT BE WAIVED OR CURED.
MECHANICAL MIRROR WORKS, INC:
MECHANICAL MIRROR WORKS, INC. (MECHANICAL), PROTESTS THE REJECTION OF
ITS LOW BID ON ITEM NO. 7 UNDER GENERAL SERVICES ADMINISTRATION (GSA)
INVITATION FOR BIDS NO. YNPF4-1365-A-2-28-83, A TOTAL SMALL BUSINESS
SET-ASIDE.
WE DENY THE PROTEST.
EACH BIDDER WAS REQUIRED TO CERTIFY IN PARAGRAPH 1, "SMALL BUSINESS,"
OF INVITATION FORM 33 ("REPRESENTATIONS, CERTIFICATIONS AND
ACKNOWLEDGMENTS") THAT IT:
". . .() IS, () IS NOT, A SMALL BUSINESS
CONCERN. IF OFFEROR IS A SMALL BUSINESS CONCERN
AND IS NOT THE MANUFACTURER OF THE SUPPLIES
OFFERED, HE ALSO REPRESENTS THAT ALL SUPPLIES TO
BE FURNISHED HEREUNDER () WILL, () WILL NOT, BE
MANUFACTURED OR PRODUCED BY A SMALL BUSINESS
CONCERN . . . ."
IN PARAGRAPH 3, "REGULAR DEALER - MANUFACTURER," OF THE SAME FORM A
BIDDER WAS REQUIRED TO INDICATE IF "HE IS A () REGULAR DEALER IN ()
MANUFACTURER OF, THE SUPPLIES OFFERED." IN INVITATION PROVISION 514
("PRODUCTION AND INSPECTION POINTS"), AT PAGE 13 OF THE INVITATION, A
BIDDER WAS TO:
". . . INSERT, IN THE APPROPRIATE SPACES PROVIDED
BELOW, THE NAMES OF THE MANUFACTURERS OF THE
ITEMS OFFERED AND THE ADDRESS, TELEPHONE NUMBER,
AND DUNS NUMBER OF THE FACILITY(IES) AT WHICH THE
ITEMS WILL BE MANUFACTURED OR PRODUCED."
MECHANICAL MADE NONE OF THESE REQUIRED INSERTIONS.
THE CONTRACTING AGENCY REJECTED THE MECHANICAL BID AS NONRESPONSIVE
UNDER SECTION 1-1.703-1(C)(3) (1964 ED.AMEND. 206) OF THE FEDERAL
PROCUREMENT REGULATIONS, WHICH STATES THAT A BIDDER SHALL NOT BE
CONSIDERED FOR AN AWARD AS A SMALL BUSINESS CONCERN UNLESS HE HAS
REPRESENTED IN GOOD FAITH THAT HE WAS A SMALL BUSINESS CONCERN AT THE
TIME OF BID OPENING. THE CONTRACTING AGENCY STATES THAT AT THE TIME THE
MECHANICAL BID WAS SUBMITTED, AND AT THE TIME OF BID OPENING, THERE WAS
NO INDICATION THAT MECHANICAL WAS A SMALL BUSINESS CONCERN. THE GSA
OFFICE OF GENERAL COUNSEL ALSO NOTES THAT THE MECHANICAL BID WAS
NONRESPONSIVE BECAUSE A BIDDER MUST ESTABLISH IN ITS BID - AND
MECHANICAL DID NOT - THAT IT WILL FURNISH ONLY PRODUCTS MANUFACTURED OR
PRODUCED BY SMALL BUSINESS CONCERNS.
IT IS THE CONTENTION OF MECHANICAL THAT ITS BID IS RESPONSIVE
INASMUCH AS MINOR INFORMALITIES OR IRREGULARITIES IN A BID - AS ARE
ALLEGEDLY INVOLVED IN THE MECHANICAL BID - MAY BE CORRECTED. MECHANICAL
CITES OUR DECISION IN B-161641, OCTOBER 31, 1967, THAT THE FAILURE OF A
BIDDER TO STATE IN ITS BID WHETHER OR NOT IT IS A SMALL BUSINESS MAY BE
WAIVED WHEN THE CONTRACTING OFFICER IS ABLE TO MAKE AN INDEPENDENT
DETERMINATION THAT THE BIDDER IS IN EFFECT A SMALL BUSINESS. MECHANICAL
STATES THAT ON MARCH 29, 1983, THE SMALL BUSINESS ADMINISTRATION (SBA)
CERTIFIED MECHANICAL AS A SMALL BUSINESS TO GSA ON A PROCUREMENT OF THE
SAME ITEM BEING PROCURED HERE. THUS, THE CONTRACTING AGENCY SHOULD HAVE
KNOWN OF THE SMALL BUSINESS STATUS OF MECHANICAL. FURTHER, AS REGARDS
THE REQUIREMENT THAT A BIDDER CERTIFY WHETHER OR NOT IT IS A SMALL
BUSINESS, MECHANICAL NOTES THAT IN OUR DECISION IN JIMMY'S APPLIANCE,
B-205611, JUNE 7, 1982, 82-1 CPD 542, WE STATED THAT THE MISTAKEN
CERTIFICATION BY A BIDDER THAT IT WAS A LARGE RATHER THAN A SMALL
BUSINESS DID NOT RENDER THE BID NONRESPONSIVE AND THE QUESTION OF THE
BIDDER'S STATUS COULD BE REFERRED TO THE SBA. MECHANICAL ALSO NOTES,
CITING OUR DECISION IN B-168881, MARCH 31, 1970, THAT WE HAVE HELD THAT
A BIDDER'S FAILURE TO INDICATE IN ITS BID ITS STATUS AS A MANUFACTURER
OF THE ITEMS BEING PROCURED OR THE SOURCE OF THESE ITEMS MAY BE WAIVED
SINCE THE OMISSIONS ARE ONLY MINOR DEFICIENCIES. IN VIEW OF THESE
CASES, MECHANICAL BELIEVES THAT THE CONTRACTING OFFICER SHOULD HAVE
ALLOWED MECHANICAL TO SUPPLY THE NECESSARY INFORMATION AFTER BID
OPENING.
WE DISAGREE. IN NONE OF THE CASES CITED BY MECHANICAL DID WE HOLD
THAT THE FAILURE OF A BIDDER TO CERTIFY THAT THE ITEMS TO BE SUPPLIED
WOULD BE MANUFACTURED OR PRODUCED BY A SMALL BUSINESS CONCERN COULD BE
WAIVED OR CORRECTED AS A MINOR INFORMALITY/IRREGULARITY. OUR RULE IN
SUCH A CASE HAS BEEN CONSISTENTLY THAT WHERE A BID ON A TOTAL SMALL
BUSINESS SET-ASIDE FAILS TO ESTABLISH THE INTENTION OF THE BIDDER TO
FURNISH PRODUCTS MANUFACTURED OR PRODUCED BY SMALL BUSINESS CONCERNS,
THE BID IS NONRESPONSIVE AND MAY NOT BE CONSIDERED FOR AWARD. CULLIGAN,
INC., 58 COMP.GEN. 307 (1979), 79-1 CPD 149; DAYTON CHEMICAL
CORPORATION, B-200122, MAY 13, 1981, 81-1 CPD 373; PARCO, A DIVISION OF
BLUE MOUNTAIN PRODUCTS, INC., B-211016, MARCH 28, 1983, 83-1 CPD 318.
JIMMY'S APPLIANCE, SUPRA, INVOLVED A SERVICE CONTRACT, NOT A SUPPLY
CONTRACT AS HERE, AND THERE WAS NO REQUIREMENT THAT BIDDERS OBLIGATE
THEMSELVES TO SUPPLY ITEMS MANUFACTURED BY A SMALL BUSINESS. A BIDDER
MUST BIND ITSELF IN ITS BID TO MEET THIS OBLIGATION OR THE BID WILL BE
RENDERED NONRESPONSIVE. MECHANICAL DID NOT STATE IN ITS BID THAT IT WAS
THE MANUFACTURER OF THE ITEMS OR THAT THE ITEMS WOULD BE MANUFACTURED BY
A SMALL BUSINESS. MOREOVER, WHILE GSA MAY HAVE KNOWN MECHANICAL WAS A
SMALL BUSINESS FROM THE PRIOR CERTIFICATION, GSA HAD NO WAY OF KNOWING
WHERE MECHANICAL INTENDED TO OBTAIN THE SUPPLIES, ABSENT THE LISTING OF
THE MANUFACTURER.
WHILE WE HAVE PERMITTED THE ACCEPTANCE OF A BID WHERE THE BIDDER HAD
NEGLECTED TO INCLUDE THIS CERTIFICATION IN ITS BID, THERE WAS
INFORMATION IN THE BID AS SUBMITTED WHICH MADE IT POSSIBLE TO ASCERTAIN
THE BIDDER'S INTENTION TO SUPPLY PRODUCTS MANUFACTURED OR PRODUCED BY
SMALL BUSINESS CONCERNS. B-156852, JUNE 9, 1965. HOWEVER, INFORMATION
OUTSIDE OF THE BID ITSELF MAY NOT BE PROVIDED BY THE BIDDER AFTER BID
OPENING SO AS TO CURE THE FAILURE TO MAKE THIS CERTIFICATION IN THE BID.
TO PERMIT A BIDDER TO MAKE ITS NONRESPONSIVE BID RESPONSIVE AFTER BID
OPENING WOULD BE TANTAMOUNT TO PERMITTING IT TO SUBMIT A NEW BID, AND
THIS MAY NOT BE PERMITTED. JACK YOUNG ASSOCIATES, INC., B-195531,
SEPTEMBER 20, 1979, 79-2 CPD 207.
THE PROTEST IS DENIED.
B-210748, AUG 3, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. ALTHOUGH EMPLOYEE ENROLLED IN
LOW OPTION HEALTH BENEFITS PLAN AT TIME OF APPOINTMENT, PAYROLL
DEDUCTIONS WERE MADE AT HIGH OPTION RATE, RESULTING IN
UNDERPAYMENT OF COMPENSATION. EMPLOYEE IS ENTITLED TO
REIMBURSEMENT OF PREMIUMS ERRONEOUSLY DEDUCTED FROM HER PAY,
SUBJECT TO THE 6-YEAR LIMITATION ON CLAIMS IN 31 U.S.C. SEC. 71A.
2. EXCESSIVE HEALTH BENEFITS PREMIUMS
WERE ERRONEOUSLY DEDUCTED FROM EMPLOYEE'S PAY FROM MARCH 1968
UNTIL SEPTEMBER 1982. EMPLOYEE CLAIMS REFUND OF EXCESSIVE
PREMIUMS FOR ENTIRE PERIOD. HER CLAIM WAS RECEIVED IN THE GENERAL
ACCOUNTING OFFICE ON FEBRUARY 9, 1983. UNDER 31 U.S.C. SEC. 71A,
A CLAIM BEARING THE SIGNATURE AND ADDRESS OF THE CLAIMANT MUST BE
RECEIVED IN GAO TO STOP THE RUNNING OF THE 6-YEAR STATUTORY
LIMITATION ON THE FILING OF CLAIMS AGAINST THE UNITED STATES. THE
EARLIER FILING OF A CLAIM WITH THE EMPLOYING AGENCY DOES NOT STOP
THE RUNNING OF THE STATUTE. CONSEQUENTLY THE REFUND CLAIM IS
BARRED FOR THE PERIOD BEFORE FEBRUARY 9, 1977.
PHYLLIS RINKACH - REFUND OF HEALTH BENEFITS PREMIUMS:
THE DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS), HAS REQUESTED A
DECISION REGARDING AN EMPLOYEE'S ENTITLEMENT TO A REFUND OF HEALTH
BENEFITS PREMIUMS FOR A 14 1/2-YEAR PERIOD.
BY LETTER DATED FEBRUARY 4, 1983, THE DIRECTOR, PAY SYSTEMS DIVISION,
OFFICE OF THE SECRETARY, HHS, INFORMED US THAT, EFFECTIVE MARCH 24,
1968, PHYLLIS RINKACH, BECAUSE OF AN ADMINISTRATIVE ERROR, HAS HAD
DEDUCTIONS FOR HIGH OPTION HEALTH BENEFITS PREMIUMS MADE FROM HER
COMPENSATION WHEN LOW OPTION DEDUCTIONS SHOULD HAVE BEEN MADE, RESULTING
IN AN UNDERPAYMENT OF COMPENSATION.
THE QUESTION RAISED IS WHETHER MS. RINKACH IS ENTITLED TO
REIMBURSEMENT FOR THE EXCESSIVE PREMIUMS ERRONEOUSLY DEDUCTED FROM HER
SALARY FOR THE FULL PERIOD FROM 1968 TO SEPTEMBER 1982.
IN 1968, MS. RINKACH ENROLLED IN THE HEALTH BENEFITS PROGRAM,
ELECTING THE SERVICE BENEFIT PLAN AT THE LOW OPTION. HOWEVER, DUE TO
ADMINISTRATIVE ERROR, HIGH OPTION PREMIUMS WERE DEDUCTED FROM HER PAY
FROM MARCH 24, 1968, TO SEPTEMBER 1982. ON SEPTEMBER 29, 1982, SHE
SUBMITTED A CLAIM FOR REFUND OF THE EXCESS DEDUCTIONS. THE CLAIM WAS
SUBSEQUENTLY FORWARDED TO THE GENERAL ACCOUNTING OFFICE AND WAS RECEIVED
HERE ON FEBRUARY 9, 1983.
WE BELIEVE IT IS CLEAR THAT MS. RINKACH IS ENTITLED TO A REFUND OF
THE EXCESS DEDUCTIONS TAKEN FROM HER PAY. SHE WAS UNDERPAID AS A RESULT
OF THE AGENCY'S ERROR IN DEDUCTING THE WRONG AMOUNTS FROM HER PAY.
MOREOVER, SHE WAS PAYING FOR HEALTH BENEFITS THAT SHE DID NOT RECEIVE
AND COULD NOT HAVE RECEIVED. THE OFFICE OF PERSONNEL MANAGEMENT HAS
INFORMED US THAT HEALTH BENEFITS COVERAGE IS DETERMINED BY THE OPTION
THE EMPLOYEE ELECTS ON THE ENROLLMENT FORMS. THEREFORE, SINCE MS.
RINKACH ELECTED THE LOW OPTION, SHE WAS NOT ENTITLED TO HIGH OPTION
BENEFITS, NOTWITHSTANDING THE HIGH OPTION DEDUCTIONS.
HOWEVER, THE PERIOD FOR WHICH SHE MAY RECEIVE A REFUND IS LIMITED BY
SECTION 71A OF TITLE 31, UNITED STATES CODE (NOW CODIFIED AS 31 U.S.C.
SEC. 3702(A) BY PUBLIC LAW 97-258, APPROVED SEPTEMBER 13, 1982, 96 STAT.
877, 970) WHICH REQUIRES THAT EVERY CLAIM COGNIZABLE BY THIS OFFICE MUST
BE RECEIVED HERE WITHIN 6 YEARS AFTER THE DATE SUCH CLAIM FIRST ACCRUED.
UNDER THESE PROVISIONS WE HAVE ALWAYS CONSIDERED RECEIPT OF A CLAIM
HERE AS CONSTITUTING A CONDITION PRECEDENT TO A CLAIMANT'S RIGHT TO HAVE
SUCH CLAIM CONSIDERED ON ITS MERITS BY THIS OFFICE. ALFRED L. LILLIE,
B-209955, MAY 31, 1983. THE DATE OF ACCRUAL OF A PAY CLAIM FOR THE
PURPOSE OF THE ABOVE-CITED STATUTE IS THE DATE THE SERVICES WERE
RENDERED AND SUCH CLAIMS ACCRUE UPON A DAILY BASIS. 29 COMP.GEN. 517
(1950). THEREFORE, IT FOLLOWS THAT THE DATE OF ACCRUAL OF THE PRESENT
CLAIM IS THE DATE ON WHICH EXCESSIVE HEALTH BENEFITS PREMIUMS WERE FIRST
ERRONEOUSLY DEDUCTED FROM MS. RINKACH'S SALARY AND THAT HER CLAIM
CONTINUED TO ACCRUE ON A DAILY BASIS AS FURTHER PREMIUMS WERE DEDUCTED.
DONALD B. SYLVAN, B-190851, FEBRUARY 15, 1978. WE ARE WITHOUT AUTHORITY
TO WAIVE OR MODIFY THE APPLICATION OF 31 U.S.C. SEC. 71A. FREDERICK C.
WELCH, B-206105, DECEMBER 8, 1982, 62 COMP.GEN. .
THUS, WITH REGARD TO THE PRESENT CASE, ONLY THAT PORTION OF MS.
RINKACH'S CLAIM WHICH ACCRUED WITHIN 6 YEARS PRIOR TO THE DATE ON WHICH
THIS OFFICE FIRST RECEIVED A CLAIM IN WRITING AND SIGNED BY MS. RINKACH
CAN BE CONSIDERED. SINCE HER CLAIM WAS RECEIVED FEBRUARY 9, 1983, THAT
PORTION OF THE CLAIM WHICH ACCRUED BETWEEN MARCH 24, 1968, THROUGH
FEBRUARY 8, 1977, IS BARRED UNDER 31 U.S.C. SEC. 71A. THUS, MS. RINKACH
IS ENTITLED ONLY TO REIMBURSEMENT FOR ERRONEOUS PREMIUMS DEDUCTED ON OR
AFTER FEBRUARY 9, 1977.
B-210747, OCT 25, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST AGAINST SOLE-SOURCE AWARD IS DENIED.
THE RECORD INDICATES THAT THE ITEMS ORDERED WERE URGENTLY NEEDED
AND THE AGENCY REASONABLY DETERMINED THAT THE AWARDEE WAS THE ONLY
FIRM QUALIFIED FOR WAIVER OF FIRST ARTICLE TESTING REQUIREMENTS AT
THE TIME THE REQUIREMENT WAS ISSUED.
2. FIRST ARTICLE TESTING IS DESIGNED TO INSURE THAT
THE CONTRACTOR CAN FURNISH A PRODUCT THAT IS SATISFACTORY FOR ITS
INTENDED USE. AGENCY DENIAL OF WAIVER OF FIRST ARTICLE TESTING TO
FIRM WHICH NEVER HAS PRODUCED SOLICITED ITEM DIRECTLY TO THE
GOVERNMENT WITHOUT BEING UNDER THE ADMINISTRATION OF AN
INTERVENING CONTRACTOR IS REASONABLE BECAUSE AGENCY DID NOT HAVE
ASSURANCE THAT FIRM PREVIOUSLY HAD FURNISHED ACCEPTABLE PRODUCT TO
GOVERNMENT.
3. PROTESTER'S REMEDIES WITH RESPECT TO ITS CONTENTION
THAT THE GOVERNMENT IS ESTOPPED TO DENY THE EXISTENCE OF A
CONTRACT AND ITS CLAIM FOR EXPENSES INCURRED IN ANTICIPATION OF
CONTRACT PERFORMANCE SHOULD BE PURSUED UNDER THE CONTRACT DISPUTES
ACT OF 1978, 41 U.S.C. SEC. 601, ET SEQ. (SUPP. III, 1979).
LUNN INDUSTRIES, INC.:
LUNN INDUSTRIES, INC. (LUNN), PROTESTS THE AWARD OF CONTRACT NO.
N00104-83-C-5912, ISSUED BY THE NAVY TO FIBCO PLASTICS, INC. (FIBCO).
THE CONTRACT IS FOR AN INTERIM BUY OF 26 RADOMES, WHICH ARE PLASTIC
COVERINGS PROTECTING THE RADAR OF TERRIER MISSILE FIRE CONTROL SYSTEMS.
LUNN CONTENDS THAT THE NAVY IMPROPERLY ELIMINATED LUNN FROM THE
COMPETITION BY REFUSING TO GRANT IT A WAIVER OF FIRST ARTICLE TESTING,
WHICH RESULTED IN AN IMPROPER SOLE-SOURCE AWARD TO FIBCO. LUNN FURTHER
OBJECTS TO THE FIRST ARTICLE WAIVER TO FIBCO. LUNN ALSO CONTENDS THAT
IT WAS "NOTIFIED" THAT IT HAD RECEIVED THE CONTRACT AND EXPENDED $50,000
BASED UPON THIS NOTICE AND SEEKS THESE COSTS PLUS PROPOSAL PREPARATION
COSTS.
WE DENY THE PROTEST AND CLAIMS.
INITIALLY THE NAVY CONTRACTING DEPARTMENT RECEIVED PURCHASE REQUESTS
FOR A QUANTITY OF 48 RADOMES. AFTER REVIEW OF ITS EXISTING STOCK, THE
BUYER DETERMINED, WITH THE CONTRACTING OFFICER'S CONCURRENCE, THAT A
CRITICAL STOCK SHORTAGE EXISTED WHICH REQUIRED TWO PROCUREMENT ACTIONS.
ONE WAS THIS INTERIM ACQUISITION, BY NEGOTIATION, FOR 26 UNITS
REPRESENTING THE URGENT PORTION OF THE OVERALL REQUIREMENT FOR 48 UNITS
NEEDED TO SATISFY BACK ORDERS AND QUARTERLY DEMANDS. THIS INTERIM BUY
WAS TO BE LIMITED TO PREVIOUS MANUFACTURERS WAIVED FOR FIRST ARTICLE
TESTING. THE REMAINING 22 UNITS ARE TO BE ACQUIRED BY FORMAL ADVERTISING
WITH REQUIREMENTS FOR FIRST ARTICLE TESTS.
THE NAVY'S DETERMINATION TO NEGOTIATE THE INTERIM BUY WAS BASED ON
ITS REVIEW OF PRODUCTION LEADTIME OF 420 DAYS FOR INITIAL DELIVERY OF
THREE UNITS AND 600 DAYS TO COMPLETE DELIVERY UNDER A FORMALLY
ADVERTISED SOLICITATION WHICH WOULD INCLUDE FIRST ARTICLE TESTING.
ON DECEMBER 9, 1982, THE NAVY INITIATED ORAL NEGOTIATIONS WITH BOTH
LUNN AND FIBCO BECAUSE THE NAVY TECHNICAL DEPARTMENT HAD ADVISED THAT
ONLY THESE FIRMS WERE PREVIOUS PRODUCERS ELIGIBLE FOR WAIVER OF FIRST
ARTICLE TESTING. QUOTES WERE RECEIVED BY TELEPHONE AND LUNN SUBMITTED
THE LOW BEST AND FINAL PRICE QUOTE OF $240,370, WITH FIBCO OFFERING A
PRICE OF $293,694.44 FOR THE 26 UNITS. THE NAVY DETERMINED THAT LUNN'S
PRICE WAS REASONABLE AND ON JANUARY 26, 1983, THE CONTRACTING OFFICER
AND BUYER APPROVED AN AWARD TO LUNN.
ON JANUARY 28, 1983, THE BUYER TELEPHONED LUNN, ADVISING THAT AN
OFFER OF AWARD TO LUNN HAD BEEN DRAFTED AND WAS READY FOR TRANSMISSION.
A LUNN OFFICIAL ADVISED THAT TRANSMISSION WOULD HAVE TO BE MADE BY
MAILGRAM BECAUSE LUNN HAD NO TELEX FACILITIES. THE NAVY REPORTS THE
BUYER ADVISED LUNN THAT THE INFORMATION WAS UNOFFICIAL AND NO CONTRACT
WOULD EXIST UNTIL LUNN'S UNCONDITIONAL ACCEPTANCE OF THE AWARD OFFER WAS
SENT TO THE NAVY. ALTHOUGH THE MAILGRAM WAS PREPARED AND DELIVERED FOR
TRANSMISSION, IT WAS NEVER SENT TO LUNN.
ON JANUARY 31, 1983, FIBCO CHALLENGED LUNN'S ELIGIBILITY FOR AWARD,
ARGUING LUNN HAD NOT UNDERGONE THE TESTS FOR PERMITTING WAIVER OF FIRST
ARTICLE TESTING. THE CONTRACTING OFFICER WITHDREW THE MAILGRAM FROM THE
TRANSMISSION OFFICE AND, UPON INQUIRY FROM LUNN, ADVISED LUNN THAT THE
ACQUISITION WAS UNDER FURTHER EVALUATION. THE NAVY ENGINEERS REVERSED
THEIR PRIOR DETERMINATION AND ADVISED, FOR THE FIRST TIME, THAT LUNN WAS
NOT ELIGIBLE FOR WAIVER OF FIRST ARTICLE TESTING. THE NAVY REPORTS THE
ENGINEERS CONCLUDED THE NAVY WAIVER APPROVAL WAS FOR REPAIR OF RADOMES,
BUT NOT MANUFACTURE OF RADOMES. THE NAVY FURTHER ADVISES THAT THE
AVAILABLE DATA SHOWED THAT THE LUNN SUBCONTRACTING WORK ON RADOMES FOR A
SPERRY CORPORATION CONTRACT WITH THE NAVY WAS LIMITED TO THREE UNITS
WHICH WERE NOT ADEQUATELY TESTED BECAUSE TESTS SPECIFICALLY APPLICABLE
TO THE RADOME WERE NOT PERFORMED. THE NAVY STATES THAT IT PREVIOUSLY
NEGOTIATED WITH LUNN ON THE BASIS OF THE PRIOR ERRONEOUS ADVICE FROM ITS
ENGINEERS.
SINCE FIBCO WAS NOW THE ONLY SUPPLIER FOR WHICH FIRST ARTICLE TESTING
WAS WAIVED AND WHICH COULD MEET THE TIME CONSTRAINTS OF THE URGENT
INTERIM REQUIREMENT, AWARD WAS MADE TO FIBCO ON FEBRUARY 7, 1983.
LUNN QUESTIONS THE NAVY'S DECISION TO AWARD SOLE SOURCE TO FIBCO AND
ARGUES THAT FIRST ARTICLE TESTING SHOULD HAVE BEEN WAIVED FOR LUNN OR
LUNN GIVEN AN OPPORTUNITY TO PERFORM SUCH TESTS.
OUR OFFICE HAS HELD THAT THE CONTRACTING AGENCY'S RESPONSIBILITY FOR
DETERMINING ITS ACTUAL NEEDS INCLUDES DETERMINING THE TYPE AND AMOUNT OF
TESTING NECESSARY TO ASSURE PRODUCT COMPLIANCE WITH SPECIFICATIONS.
EDMAC ASSOCIATES, INC., B-200358, SEPTEMBER 1, 1981, 81-2 CPD 193.
THEREFORE, AN AGENCY'S DECISION TO WAIVE FIRST ARTICLE TESTING WILL NOT
BE QUESTIONED UNLESS THE WAIVER IS CLEARLY SHOWN TO BE ARBITRARY OR
CAPRICIOUS. MOREOVER, DEFENSE ACQUISITION REGULATION (DAR) SEC.
1-1903(A) (1976 ED.) SPECIFICALLY PROVIDES THAT THE GOVERNMENT MAY WAIVE
FIRST ARTICLE APPROVAL REQUIREMENTS FOR A PRIOR PRODUCER WHICH
PREVIOUSLY HAS FURNISHED ACCEPTABLE SUPPLIES SIMILAR TO THOSE REQUIRED.
ADVANI ENGINEERING COMPANY, B-192256, NOVEMBER 14, 1978, 78-2 CPD 344.
THE NAVY STATES THAT FIBCO COMPLETED FIRST ARTICLE TESTING AND APPROVAL
PRIOR TO FABRICATION OF THE RADOMES FOR THE NAVY IN 1973 AND
SPECIFICALLY REFERS TO A MAILGRAM DATED JANUARY 24, 1973, WHICH SHOWS
THE APPROVALS. FURTHER, THE NAVY REPORTS THAT, AS RECENTLY AS 1981, THE
FIRM HAS PRODUCED RADOMES FOR THE NAVY. LUNN HAS NOT REFUTED THESE
STATEMENTS AND, IN OUR VIEW, HAS NOT SHOWN THAT THE NAVY'S DECISION TO
WAIVE TESTING REQUIREMENTS FOR THE ORDER PLACED WITH FIBCO WAS WITHOUT A
REASONABLE BASIS.
LUNN ALSO CLAIMS THAT IT WAS ENTITLED TO A WAIVER OF FIRST ARTICLE
TESTING BECAUSE IT CAN PRODUCE AN ACCEPTABLE PRODUCT AND ITS RECORD OF
PERFORMANCE SHOWS IT HAS SUCCESSFULLY PRODUCED THIS ITEM FOR A NAVY
PRIME CONTRACT.
FIRST ARTICLE TESTING IS DESIGNED TO INSURE THAT THE CONTRACTOR CAN
FURNISH A PRODUCT THAT IS SATISFACTORY FOR ITS INTENDED USE. DAR SEC.
1-1902 (1976 ED.). HERE, THE NAVY DID NOT ACCEPT LUNN'S PERFORMANCE
UNDER THE PRIME CONTRACT AS ACCEPTABLE FOR WAIVER PURPOSES. IN OUR
VIEW, THIS WAS A REASONABLE DETERMINATION SINCE THE PROTESTER HAS NOT
SUPPLIED THE ITEM DIRECTLY TO THE GOVERNMENT WITHOUT BEING UNDER THE
ADMINISTRATION OF AN INTERVENING CONTRACTOR. MOREOVER, REGARDLESS OF
WHETHER LUNN WAS ADVISED OF THE FIRST ARTICLE TESTING REQUIREMENTS
DURING THE ORAL SOLICITATION, IN OUR VIEW, THE NAVY HAD THE RIGHT TO
REQUIRE ASSURANCE THAT IT WOULD OBTAIN AN ACCEPTABLE PRODUCT PRIOR TO
ANY AWARD. THE RECORD INDICATES THAT THE NAVY CLEARLY INTENDED TO AWARD
THE INTERIM BUY TO A FIRM WHICH DID NOT REQUIRE FIRST ARTICLE TESTING IN
ORDER TO ENSURE THAT IT WOULD OBTAIN AN ACCEPTABLE PRODUCT WITHIN THE
LIMITING TIME CONSTRAINTS, AND WE THINK THIS AGENCY ACTION WAS
REASONABLE. SEE EDMAC ASSOCIATES, INC., SUPRA; MCQUISTON ASSOCIATES,
B-199013, SEPTEMBER 1, 1981, 81-2 CPD 192.
OUR OFFICE HAS RECOGNIZED THAT THE TIME OF DELIVERY CAN BECOME
CONTROLLING IN URGENT PROCUREMENTS, AND WE HAVE NOT OBJECTED TO A
SOLE-SOURCE AWARD TO THE ONLY OFFEROR QUALIFYING FOR WAIVER OF FIRST
ARTICLE TESTING WHEN SUCH A WAIVER IS ESSENTIAL TO THE FULFILLMENT OF
REQUIRED DELIVERY SCHEDULES. EDMAC ASSOCIATES, INC., SUPRA; T.M.
SYSTEMS, B-196170, APRIL 8, 1980, 80-1 CPD 261; MODULAR DEVICES, INC.,
B-182288, AUGUST 20, 1975, 75-2 CPD 119. LUNN HAS NOT REFUTED THE
CRITICAL NEED STATED BY THE NAVY AS JUSTIFICATION FOR THE SOLE-SOURCE
AWARD.
BECAUSE LUNN DID NOT QUALIFY FOR WAIVER OF FIRST ARTICLE TESTING,
FIBCO DID QUALIFY, AND THE RECORD PROVIDES NO BASIS TO QUESTION THE
URGENCY OF THE PROCUREMENT, WE BELIEVE THAT THE NAVY ACTED REASONABLY IN
PLACING THE ORDER WITH FIBCO. WHILE LUNN ARGUES IT COULD HAVE PROVIDED
AN ACCEPTABLE PRODUCT WHICH COULD HAVE BEEN TESTED WITHIN THE TIME
CONSTRAINTS INVOLVED, THE NAVY DENIES THIS IS THE CASE. IT HAS SHOWN
THAT PRODUCTION LEADTIME AND TESTING REQUIREMENT CONSIDERATIONS DID NOT
PROVIDE SUFFICIENT TIME TO PERMIT LUNN INTO THE COMPETITION WITHOUT A
WAIVER. IN THE FACE OF THESE STATEMENTS BY THE NAVY, WE CANNOT SAY THE
PROTESTER HAS PROVEN HIS CASE OR THAT THE SOLE-SOURCE DECISION WAS
UNREASONABLE. T.M. SYSTEMS, INC., SUPRA.
LUNN ALSO ARGUES THAT THE NAVY AWARDED IT THE CONTRACT ON JANUARY 28,
1983. IT STATES THAT ON THAT DATE IT WAS GIVEN A CONTRACT NUMBER AND
TOLD THE CONTRACT HAD BEEN AWARDED TO IT WITH WRITTEN CONFIRMATION TO
FOLLOW BY TELEGRAM ON THAT DATE. LUNN ADVISES THAT BASED ON ITS
KNOWLEDGE OF THE URGENCY OF THE PROCUREMENT AND RELIANCE ON THE NAVY'S
REPRESENTATION THAT LUNN WOULD RECEIVE THE CONTRACT, LUNN PLACED ORDERS
FOR SUPPLIES NECESSARY TO MEET THE OFFERED DELIVERY SCHEDULE. LUNN
CLAIMS EXPENSES INCURRED IN ANTICIPATION OF CONTRACT PERFORMANCE.
THE PROTESTER'S REMEDIES WITH RESPECT TO ITS CONTENTION THAT THE
GOVERNMENT IS ESTOPPED TO DENY THE EXISTENCE OF A CONTRACT AND ITS CLAIM
FOR EXPENSES INCURRED IN ANTICIPATION OF CONTRACT PERFORMANCE SHOULD BE
PURSUED UNDER THE CONTRACT DISPUTES ACT OF 1978, 41 U.S.C. SEC. 601, ET
SEQ. (SUPP. III, 1979). SEE AUTOMATED BUSINESS SYSTEMS AND SERVICES,
INC., B-205422, DECEMBER 11, 1981, 81-2 CPD 461.
REGARDING LUNN'S CLAIM FOR PROPOSAL PREPARATION COSTS, IN VIEW OF OUR
CONCLUSION THAT LUNN'S PROTEST IS WITHOUT MERIT, ITS CLAIM FOR PROPOSAL
PREPARATION COSTS IS DENIED. ARMCO, INC., ET AL., B-210018, 210018.2,
MAY 23, 1983, 83-1 CPD 553.
B-210742, MAR 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST AGAINST CONTRACT AWARDED BY SOLDIERS' AND AIRMEN'S HOME IS
DISMISSED SINCE THE AWARD DOES NOT INVOLVE THE DIRECT EXPENDITURE OF
APPROPRIATED FUNDS.
STEUART PETROLEUM COMPANY:
STEUART PETROLEUM COMPANY (STEUART) PROTESTS AN AWARD TO ANY OTHER
BIDDER UNDER INVITATION FOR BIDS (IFB) NO. 30100261, ISSUED BY THE
UNITED STATES SOLDIERS' AND AIRMEN'S HOME, WASHINGTON, D. C.
WE DISMISS THE PROTEST.
THE IFB SOLICITED BIDS FOR THE SUPPLY OF APPROXIMATELY 1.8 MILLION
GALLONS OF NO. 6 FUEL OIL FOR THE PERIOD FEBRUARY 1, 1983, THROUGH
JANUARY 31, 1984. IN STEUART'S OPINION, IT IS ENTITLED TO THE AWARD
SINCE IT OFFERED THE LOWEST BID PRICE WHEN THE FORMULA SPECIFIED IN THE
IFB IS APPLIED. STEUART ALSO ARGUES THAT THE JACKSON OIL COMPANY'S BID
SHOULD BE REJECTED AS NONRESPONSIVE SINCE THE FIRM DID NOT USE THE
ESCALATION INDEX SPECIFIED IN THE IFB.
THE SOLDIERS' AND AIRMEN'S HOME IS NOT SUPPORTED BY FUNDS
APPROPRIATED FROM THE GENERAL TREASURY, BUT FROM FINES AND FORFEITURES
ADJUDGED AGAINST SOLDIERS AND AIRMEN BY THE MILITARY AUTHORITIES,
UNCLAIMED MONEYS BELONGING TO THE ESTATES OF DECEASED SERVICEMEN, A FEE
LEVIED ON MEMBERS OF THE HOME, AND PAY DEDUCTIONS FROM ENLISTED MEN AND
WARRANT OFFICERS. SEE 24 U.S.C. SECS. 44, 44B, 44C (1976). ITS
EXPENDITURES ARE NOT SUBJECT TO AUDIT OR EXCEPTION BY OUR OFFICE.
B-155495, NOVEMBER 27, 1964.
THEREFORE WE WILL NOT CONSIDER STEUART'S PROTEST ON THE MERITS SINCE,
EVEN IF WE AGREE WITH STEUART'S ARGUMENTS, WITHOUT THE EXPENDITURE OF
APPROPRIATED FUNDS, WE WOULD NOT BE ABLE TO RECOMMEND ANY CORRECTIVE
ACTION.
PROTEST IS DISMISSED.
B-210740.2, JUN 14, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
PRIOR DECISION SUSTAINING A GENERAL
SERVICES ADMINISTRATION FINDING THAT
A CARRIER HAS OVERCHARGED THE GOVERNMENT
IS AFFIRMED WHERE THE CARRIER'S
REQUEST FOR RECONSIDERATION FAILS TO
DEMONSTRATE THAT ERRORS OF FACT OR OF
LAW EXIST IN THAT DECISION WHICH WARRANT
ITS REVERSAL OR MODIFICATION.
STARFLIGHT, INC.:
STARFLIGHT, INC. REQUESTS RECONSIDERATION OF OUR DECISION,
STARFLIGHT, INC., B-210740, SEPT. 27, 1983, IN WHICH WE SUSTAINED A
FINDING BY THE GENERAL SERVICES ADMINISTRATION (GSA) THAT STARFLIGHT HAD
OVERCHARGED THE GOVERNMENT $2,134.16 FOR SERVICES INVOLVING THE AIR
TRANSPORTATION OF TWO SHIPMENTS OF MACHINE GUNS UNDER GOVERNMENT BILL OF
LADING (GBL) NOS. S-0,953,548 AND AND S-0,953,580. THE BASIS FOR OUR
DECISION WAS THAT THE GOVERNMENT IS ENTITLED TO THE CARRIER'S APPLICABLE
TENDER WHICH AFFORDS THE GOVERNMENT THE MOST FAVORABLE RATE, AND WHERE A
CARRIER'S CLAIM FOR PAYMENT IS BASED UPON A TENDER, AMBIGUITIES IN THE
TERMS OF THAT TENDER WILL BE RESOLVED AGAINST THE CARRIER. THUS, WE
DECIDED THAT GSA PROPERLY APPLIED STARFLIGHT'S TENDER NO. 4 TO BOTH
SHIPMENTS EVEN THOUGH THE TERMS OF STARFLIGHT'S TENDER NO. 3, IMPROPERLY
CITED IN ONE OF THE GBLS, STATED THAT STARFLIGHT TENDER NO. 2
(CONTAINING HIGHER RATES THAN TENDER NO. 4) WAS TO BE USED IF TENDER NO.
3 WAS INAPPLICABLE. WE AFFIRM OUR DECISION.
STARFLIGHT REQUESTS RECONSIDERATION OF OUR DECISION ON THE GROUND
THAT GSA DID NOT HAVE THE AUTHORITY TO APPLY TENDER NO. 4 WHERE ANOTHER
OF THE CARRIER'S TENDERS GAVE CONTRARY INSTRUCTIONS AS TO WHICH TENDER
IS TO BE USED WHEN THE TENDER CITED IN THE GBL IS INAPPLICABLE.
IN OUR DECISION, WE STATED THAT WE WOULD NOT APPLY THE PROVISIONS OF
TENDER NO. 3 TO A SHIPMENT TO WHICH THAT TENDER WAS NOT APPLICABLE. WE
THUS CONCLUDED THAT THE GOVERNMENT WAS ENTITLED TO THE MOST FAVORABLE
RATES NOTWITHSTANDING ANY PROVISIONS OF TENDER NO. 3 WHICH PURPORTED TO
ESTABLISH RATES FOR SHIPMENTS EXPRESSLY NOT COVERED BY TENDER NO. 3. IN
SHORT, WE INDEED DO BELIEVE THAT GSA COULD PROPERLY APPLY THE TENDER
AFFORDING THE GOVERNMENT THE LOWEST RATE, NOTWITHSTANDING THE PROVISIONS
OF TENDER NO. 3. FURTHER, WE DO NOT BELIEVE, AS STARFLIGHT ARGUES, THAT
IT IS AT ALL INCONSISTENT TO LOOK TO THE PROVISIONS OF A TENDER TO
DETERMINE WHETHER THAT PARTICULAR TENDER APPLIES TO A SHIPMENT, AND ONCE
IT IS DETERMINED THAT THE TENDER DOES NOT APPLY TO THE SHIPMENT, TO
IGNORE LANGUAGE IN THAT INAPPLICABLE TENDER WHICH PURPORTS TO INSTRUCT
THE SHIPPER AS TO THE TENDER WHICH SHOULD BE APPLIED. WE FIND NOTHING
IN STARFLIGHT'S REQUEST FOR RECONSIDERATION TO INDICATE THAT OUR
DECISION CONTAINS ERRORS OF FACT OR OF LAW WHICH WARRANT ITS REVERSAL OR
MODIFICATION.
THE PRIOR DECISION IS AFFIRMED.
B-210740, SEP 27, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. NOT ONLY DO CLAIMANTS GENERALLY BEAR THE
BURDEN OF PROVING THEIR CLAIMS AND ESTABLISHING THE LIABILITY OF
THE UNITED STATES, BUT WHERE THE CLAIMANT IS A CARRIER MAKING A
CLAIM BASED UPON A TENDER OR TARIFF, THEN AMBIGUITIES IN THE TERMS
OF THE TENDER OR TARIFF ARE TO BE RESOLVED AGAINST THE CLAIMANT.
2. AN AGENCY IS ENTITLED TO THE SHIPPER'S
APPLICABLE TENDER WHICH AFFORDS THE GOVERNMENT THE MOST FAVORABLE
RATE.
STARFLIGHT, INC.:
STARFLIGHT, INC. REQUESTS OUR REVIEW OF A GENERAL SERVICES
ADMINISTRATION NOTICE OF OVERCHARGE CONCERNING THE TRANSPORTATION OF
MACHINE GUNS UNDER GOVERNMENT BILL OF LADING NOS. S-0,953,548 (GBL-548)
AND S-0,953,580 (GBL-580) ISSUED BY THE ANNISTON ARMY DEPOT, ANNISTON,
ALABAMA. STARFLIGHT ADMITS TO AN OVERCHARGE BUT CONTENDS THAT IT OWES A
LESSER AMOUNT THAN THAT CLAIMED BY GSA. WE DISAGREE WITH STARFLIGHT'S
CONTENTIONS CONCERNING THE AMOUNT OF THE OVERCHARGE AND SUSTAIN GSA'S
FINDINGS.
GBL-548 WAS ISSUED FOR THE SHIPMENT BY AIR OF MACHINE GUNS FROM
ALABAMA TO DELAWARE. THE GBL CITED STARFLIGHT'S TENDER NO. 3 AS THE
APPLICABLE RATE FOR THE SHIPMENT. GBL-580 WAS ISSUED FOR THE SHIPMENT
BY AIR OF MACHINE GUNS FROM ALABAMA TO CALIFORNIA. THE GBL CITED
STARFLIGHT'S TENDER NO. 1 AS THE APPLICABLE RATE.
BOTH STARFLIGHT AND GSA AGREE THAT THE TENDERS CITED IN THE GBLS WERE
NOT APPLICABLE. TENDER NO. 3 CITED IN GBL-548 WAS RESTRICTED TO
SHIPMENTS OF WEAPONS WEIGHING 300 POUNDS OR LESS WHILE THE SHIPMENT
UNDER THIS GBL WEIGHED 330 POUNDS. TENDER NO. 1 CITED IN GBL-580 WAS
NOT APPLICABLE TO THE SHIPMENT OF WEAPONS. IN ADDITION, STARFLIGHT
CONCEDES THAT, AS CONTENDED BY GSA, THE 5 PERCENT AIRPORT CHARGE FOR
WHICH STARFLIGHT BILLED THE GOVERNMENT WAS INAPPLICABLE TO THESE
SHIPMENTS.
STARFLIGHT AND GSA DISAGREE, HOWEVER, ON THE PROPER TENDER TO APPLY.
STARFLIGHT BILLED THE GOVERNMENT $1,725.86 FOR THE SHIPMENT UNDER
GBL-548 AND $2,311 FOR THE SHIPMENT UNDER GBL-580 BASED UPON THE RATES
IN STARFLIGHT'S TENDER NO. 2. GSA, ON THE OTHER HAND, APPLIED
STARFLIGHT'S TENDER NO. 4 AND DETERMINED THE PROPER CHARGES TO HAVE BEEN
$732.65 FOR THE SHIPMENT UNDER GBL-548 AND $1,170.05 FOR THE SHIPMENT
UNDER GBL-580. GSA ACCORDINGLY ISSUED NOTICES OF OVERCHARGE IN THE
AMOUNTS OF $993.21 AND $1,140.95 FOR THE RESPECTIVE SHIPMENTS. IF, AS
STARFLIGHT ARGUES, TENDER NO. 2 DOES APPLY TO THE SHIPMENT UNDER
GBL-548, THEN STARFLIGHT ALSO CONTENDS THAT THE DIMENSIONS OF THE
SHIPMENT OF GUNS IN PALLETS WERE SUCH THAT A CARGO DOOR WAS REQUIRED,
THUS MAKING APPLICABLE THE HIGHER SCHEDULES IN TENDER NO. 2 SPECIFIED
FOR USE WHEN CARGO DOORS MUST BE USED.
BOTH TENDER NOS. 2 AND 4 ARE APPLICABLE TO MACHINE GUNS WITH THE
WEIGHTS AND DIMENSIONS OF THOSE SHIPPED UNDER THE SUBJECT GBLS. TENDER
NO. 2 HAS NO RESTRICTIONS AS TO TYPE OF CARGO, AND NO EXPRESS
RESTRICTIONS AS TO WEIGHT OR DIMENSION. TENDER NO. 4 PROVIDES THAT IT
DOES NOT APPLY TO SHIPMENTS OVER 600 POUNDS, OVER 82 INCHES LONG, OVER
50 CUBIC FEET IN VOLUME, OR TO SHIPMENTS REQUIRING AN ARMED GUARD OR THE
EXCLUSIVE USE OF AN AIRCRAFT. THE GBL-548 SHIPMENT WEIGHED 330 POUNDS,
AND MEASURED 63" X 36" X 16" FOR A TOTAL OF 23 CUBIC FEET. THE GBL-580
SHIPMENT WEIGHED 408 POUNDS AND CONSISTED OF FOUR CARTONS, EACH
MEASURING 59" X 18" X 12" FOR A TOTAL OF 7 CUBIC FEET EACH. THESE FOUR
CARTONS COULD BE CONSOLIDATED INTO A SINGLE PACKAGE WITH A VOLUME OF 28
CUBIC FEET. THERE IS NO ALLEGATION OR INDICATION THAT ARMED GUARDS OR
THE EXCLUSIVE USE OF AN AIRCRAFT WERE REQUIRED FOR EITHER SHIPMENT.
STARFLIGHT, HOWEVER, CONTENDS THAT TENDER NO. 2 WAS THE APPLICABLE
RATE FOR THE SHIPMENT UNDER GBL-548 BECAUSE THAT GBL ERRONEOUSLY
INDICATED THAT TENDER NO. 3 WAS APPLICABLE AND TENDER NO. 3 PROVIDED
THAT:
"NOTE 7. THIS TENDER DOES NOT APPLY TO:
1. SHIPMENTS OVER 300 POUNDS
* * * * *
6. IF (1) - (5) CANNOT BE COMPLIED WITH,
USE STARFLIGHT TENDER NO. 2."
STARFLIGHT ALSO CONTENDS THAT TENDER NO. 4 IS NOT THE APPLICABLE RATE
FOR THE SHIPMENT UNDER GBL-580, AND THAT THEREFORE TENDER NO. 2 IS
APPLICABLE, BECAUSE THE ARMY FAILED TO INDICATE "WEAPONS SERVICE
REQUESTED" ON THE GBL.
CLAIMANTS BEAR THE BURDEN OF PROVING THEIR CLAIMS AND ESTABLISHING
THE LIABILITY OF THE UNITED STATES. ULTRA SPECIAL EXPRESS, 55 COMP.
GEN. 301 (1975). FURTHER, WHERE THE CLAIMANT IS A CARRIER MAKING A
CLAIM BASED UPON TARIFFS OR TENDERS, AMBIGUITIES OR UNCERTAINTIES IN THE
TERMS OF THE TARIFF OR TENDER ARE TO BE RESOLVED AGAINST THE CARRIER, AS
THE AUTHOR OF THE DOCUMENT, AND IN FAVOR OF THE SHIPPER. EASTERN
AIRLINES, INC., 55 COMP.GEN. 958 (1976); ULTRA SPECIAL EXPRESS, SUPRA.
STARFLIGHT HAS FAILED TO ESTABLISH THAT THE GOVERNMENT IS LIABLE
UNDER TENDER NO. 2, RATHER THAN UNDER TENDER NO. 4, FOR THE SHIPMENT
UNDER GBL-548. WE SEE NO REASON TO APPLY THE PROVISIONS OF TENDER NO.
3 TO A SHIPMENT TO WHICH TENDER NO. 3 IS BY ITS TERMS EXPRESSLY MADE
INAPPLICABLE. A PROVISION IN A TENDER ESTABLISHING THE RATES FOR
SHIPMENTS TO WHICH THAT TENDER AND ITS PROVISIONS ARE EXPRESSLY DECLARED
INAPPLICABLE IS A CONTRADICTION WHICH AT MOST RAISES AN AMBIGUITY OR
UNCERTAINTY WHICH MUST BE INTERPRETED AGAINST THE CARRIER. SINCE,
THEREFORE, EITHER TENDER NO. 2 OR NO. 4 COULD APPLY, THE ARMY WAS
ENTITLED TO THE BENEFIT OF THE RATES UNDER TENDER NO. 4, THE TENDER
AFFORDING THE MOST FAVORABLE RATE FOR THE GOVERNMENT. SEE TRANS COUNTRY
VAN LINES, INC., 52 COMP.GEN. 927 (1973).
STARFLIGHT HAS LIKEWISE FAILED TO ESTABLISH THAT THE GOVERNMENT IS
LIABLE FOR THE RATE UNDER TENDER NO. 2, RATHER THAN UNDER TENDER NO. 4,
FOR THE SHIPMENT UNDER GBL-580. ALTHOUGH TENDER NO. 4 IS DESIGNATED A
"WEAPONS TENDER," WE SEE NOTHING IN THE TENDER THAT REQUIRED THE ARMY TO
INDICATE ON THE GBL "WEAPONS SERVICE REQUESTED" BEFORE THAT TENDER WOULD
BE APPLICABLE TO A SHIPMENT. THEREFORE, THE ARMY WAS ENTITLED TO THE
BENEFIT OF THE RATES UNDER TENDER NO. 4, THE TENDER AFFORDING THE MOST
FAVORABLE RATE FOR THE GOVERNMENT.
WE SUSTAIN GSA'S OVERCHARGE FINDINGS.
B-210739, JUN 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
EMPLOYEE WHO TRANSFERRED TO A POSITION HAVING THE SAME TITLE, GRADE,
AND PROMOTION POTENTIAL IS NOT ENTITLED TO MOVING EXPENSES SINCE THE
EMPLOYING AGENCY PROPERLY DETERMINED THAT HE TRANSFERRED FOR HIS OWN
BENEFIT AND NOT IN THE INTEREST OF THE GOVERNMENT.
JAMES C. JACKSON, JR.:
THIS ACTION IS IN RESPONSE TO THE REQUEST OF AN AUTHORIZED CERTIFYING
OFFICER OF THE INTERNAL REVENUE SERVICE, SOUTHEAST REGION, FOR AN
ADVANCE DECISION AS TO WHETHER AN EMPLOYEE'S CLAIM FOR RELOCATION
EXPENSES MAY BE PAID. WE CONCLUDE THAT THE CLAIM IS NOT PAYABLE BECAUSE
THE EXPENSES WERE INCURRED IN CONNECTION WITH A TRANSFER WHICH THE
AGENCY HAS PROPERLY DETERMINED WAS PRIMARILY FOR THE BENEFIT OF THE
EMPLOYEE.
THE EMPLOYEE, MR. JAMES C. JACKSON, JR., WAS EMPLOYED AS A GRADE
GS-7, REVENUE AGENT, IN DALLAS, TEXAS, WHEN IN AUGUST 1980 HE REQUESTED
A TRANSFER TO THE JACKSON (MISSISSIPPI) DISTRICT OFFICE IN THE SAME
POSITION. SUBSEQUENTLY, A VACANCY ANNOUNCEMENT WAS POSTED FOR A GRADE
GS-5/7/9 REVENUE AGENT IN THE JACKSON DISTRICT. SINCE HIS INITIAL
REQUEST HAD NOT YET BEEN PROCESSED, MR. JACKSON APPLIED AND WAS
COMPETITIVELY SELECTED FOR THE ANNOUNCED POSITION AT GRADE GS-7.
ALTHOUGH RELOCATION EXPENSES WERE NOT AUTHORIZED FOR HIS TRANSFER, HE
ACCEPTED THE POSITION AND REPORTED FOR DUTY AT THE NEW POST ON FEBRUARY
1, 1981.
MR. JACKSON NOW BELIEVES HE IS ENTITLED TO PAYMENT ON THE BASIS OF
THE DECISIONS OF THE COMPTROLLER GENERAL IN MATTER OF PLATT, 59 COMP.
GEN. 699 (1980), AND RECONSIDERATION OF PLATT, 61 COMP.GEN. 156 (1981).
IN OUR DECISION, MATTER OF PLATT, 59 COMP.GEN. 699 (1980), AN AGENCY
HAD POSTED AN OFFICIAL VACANCY ANNOUNCEMENT FOR A POSITION TO BE FILLED
UNDER ITS MERIT PROMOTION PROGRAM. THE EMPLOYEE APPLIED AND WAS
SELECTED FOR THE POSITION, BUT THE AGENCY DENIED RELOCATION EXPENSES ON
SEVERAL BASES, ONE OF WHICH WAS ITS DETERMINATION THAT SINCE THE
EMPLOYEE APPLIED FOR THE POSITION, THE TRANSFER WAS FOR HIS CONVENIENCE
AND, THEREFORE, NOT IN THE INTEREST OF THE GOVERNMENT. WE FOUND THAT
THE FACT THAT AN EMPLOYEE REQUESTS A POSITION AS A RESULT OF SUCH AN
ANNOUNCEMENT IS NOT A PROPER BASIS TO CONCLUDE THAT THE TRANSFER IS AT
THE REQUEST OF, OR PRIMARILY FOR THE CONVENIENCE OF, THE EMPLOYEE.
MR. JACKSON CONTENDS THAT HE SHOULD BE REIMBURSED FOR MOVING EXPENSES
BECAUSE HE WAS COMPETITIVELY SELECTED FOR THE POSITION TO WHICH HE
TRANSFERRED. HE ALSO MAINTAINS THAT HIS TRANSFER WAS IN THE INTEREST OF
THE GOVERNMENT SINCE HE HAD EXPERIENCE IN THE POSITION WHEREAS THE OTHER
APPLICANTS WHO WERE CONSIDERED DID NOT.
THE REGIONAL DISTRICT DIRECTOR (INTERNAL REVENUE SERVICE) DETERMINED
ON THE BASIS OF MATTER OF TOM, B-206011, MAY 3, 1982, THAT MR. JACKSON
WAS NOT ENTITLED TO MOVING EXPENSES BECAUSE THEY WERE INCURRED IN
CONNECTION WITH A LATERAL TRANSFER TO A POSITION HAVING NO GREATER
PROMOTION POTENTIAL THAN HIS POSITION IN DALLAS, AND BECAUSE MR.
JACKSON HAD REQUESTED THE TRANSFER FOR PERSONAL REASONS.
REIMBURSEMENT OF TRAVEL AND RELOCATION EXPENSES UPON AN EMPLOYEE'S
CHANGE OF STATION UNDER 5 U.S.C. SECS. 5724 AND 5724A (1976) IS
CONDITIONED UPON A DETERMINATION BY THE HEAD OF THE AGENCY CONCERNED OR
BY THE DESIGNATED OFFICIAL THAT THE TRANSFER IS IN THE INTEREST OF THE
GOVERNMENT AND IS NOT PRIMARILY FOR THE CONVENIENCE OR BENEFIT OF THE
EMPLOYEE, OR AT HIS REQUEST. FEDERAL TRAVEL REGULATIONS (FPMR 101-7)
(MAY 1973) (IN EFFECT AT THE TIME OF THE CONCERNED TRAVEL AND
RELOCATION), PARAGRAPH 2-1.3.
IN RECOGNITION OF THE AUTHORITY OF THE EMPLOYING AGENCY TO DETERMINE
WHETHER A TRANSFER IS IN THE INTEREST OF THE GOVERNMENT OR PRIMARILY FOR
THE CONVENIENCE OR BENEFIT OF THE EMPLOYEE, OR AT HIS REQUEST, WE WILL
NOT OVERTURN THE AGENCY'S DETERMINATION UNLESS IT IS ARBITRARY,
CAPRICIOUS, OR CLEARLY ERRONEOUS UNDER THE FACTS OF THE CASE. MATTER OF
HERTZKE, B-205958, JULY 13, 1982, AND CASES CITED THEREIN.
IN THIS CASE, WE CONCUR IN THE DETERMINATION OF THE DISTRICT DIRECTOR
THAT MR. JACKSON IS NOT ENTITLED TO RELOCATION EXPENSES UNDER THE FACTS
AS PRESENTED. ALTHOUGH MR. JACKSON RESPONDED TO A VACANCY ANNOUNCEMENT
AND WAS COMPETITIVELY SELECTED FOR THE POSITION AS IN PLATT, THAT CASE
INVOLVED A PROMOTION, WHEREAS IN THIS CASE THE REASSIGNMENT DID NOT
REPRESENT A PROMOTION, BUT A LATERAL TRANSFER TO A POSITION HAVING NO
GREATER PROMOTION POTENTIAL THAN HIS FORMER POSITION.
IN CASES SUCH AS THIS WHERE AN EMPLOYEE'S TRANSFER DID NOT REPRESENT
A PROMOTION BUT WAS A LATERAL TRANSFER TO A POSITION HAVING NO GREATER
PROMOTION POTENTIAL, WE HAVE SUSTAINED THE AGENCY'S DETERMINATION THAT
THE TRANSFER WAS FOR THE EMPLOYEE'S CONVENIENCE AND NOT IN THE INTEREST
OF THE GOVERNMENT. SEE MATTER OF PLATT, (1980), AT 701, AND CASES CITED
THEREIN; MATTER OF GIRARD, B-199943, AUGUST 4, 1981; AND MATTER OF
TOM, B-206011, MAY 3, 1982.
THUS, UNDER THE CIRCUMSTANCES OF THIS CASE, THE HOLDINGS IN PLATT AND
IN PLATT RECONSIDERATION (1981) DO NOT APPLY. ACCORDINGLY, PAYMENT TO
MR. JACKSON OF TRAVEL AND RELOCATION EXPENSES IN CONNECTION WITH THE
SUBJECT TRANSFER MUST BE DENIED.
B-210737, JUL 5, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
APPEAL OF PROTEST INITIALLY FILED WITH PROCURING AGENCY MUST BE FILED
WITH GAO WITHIN 10 WORKING DAYS AFTER PROCURING AGENCY'S INITIAL ADVERSE
ACTION. THE PROCURING AGENCY RESPONDED TO PROTEST BY REAFFIRMING ITS
POSITION AT A DEBRIEFING AND AWARDING THE CONTRACT. APPEAL FILED WITH
GAO MORE THAN A MONTH AND A HALF AFTER THIS ADVERSE ACTION IS,
THEREFORE, UNTIMELY,
PRIEST & FINE, INC.:
PRIEST & FINE, INC. (P&F), PROTESTS THE AWARD OF A CONTRACT BY THE
NATIONAL SCIENCE FOUNDATION (NSF) TO SPESER ASSOCIATES (SPESER) UNDER
REQUEST FOR PROPOSALS (RFP) NO. 82-122, A TOTAL SMALL BUSINESS
SET-ASIDE. THE CONTRACT IS FOR THE ORGANIZATION AND PRESENTATION OF TWO
CONFERENCES DESIGNED TO MAKE SMALL BUSINESSES AWARE OF THE AVAILABILITY
OF VARIOUS OPPORTUNITIES TO COMPETE FOR FEDERAL CONTRACTS AND GRANTS IN
HIGH TECHNOLOGY RESEARCH AND DEVELOPMENT. P&F CONTENDS THAT IT SHOULD
HAVE BEEN INCLUDED IN THE COMPETITIVE RANGE BECAUSE IT COULD PERFORM THE
CONTRACT AT A LOWER PRICE THAN SPESER.
THE PROTEST IS DISMISSED.
PROPOSALS WERE TO BE EVALUATED ON THE BASIS OF TECHNICAL AND COST
CRITERIA. THE 20 PROPOSALS WHICH WERE CRITERIA. FIVE PROPOSALS,
INCLUDING P&F, WERE JUDGED TO BE SUPERIOR TO THE OTHERS. FOURTEEN WERE
REGARDED AS BEING OF LOWER QUALITY. ONE WAS DEEMED "NONRESPONSIVE."
THE FIVE SUPERIOR PROPOSALS WERE REEVALUATED. SPESER AND LAKESHORE
GROUP, LTD., (LAKESHORE), HAD THE HIGHEST TECHNICAL SCORES. HOWEVER,
P&F TIED FOR SECOND ONCE ITS COST SCORE WAS ADDED TO ITS TECHNICAL
SCORE. SPESER AND LAKESHORE WERE THE ONLY FIRMS SELECTED FOR THE
COMPETITIVE RANGE.
P&F ORALLY PROTESTED THE AWARD OF A CONTRACT ON DECEMBER 14, 1982,
AND FILED A WRITTEN PROTEST WITH NSF ON DECEMBER 21. NSF CONDUCTED A
DEBRIEFING ON DECEMBER 22, AT WHICH P&F WAS ADVISED OF THE BASIS UPON
WHICH IT WAS NOT INCLUDED IN THE COMPETITIVE RANGE. NSF CALLED P&F THE
NEXT DAY AND CONTENDS P&F INDICATED IT WOULD WITHDRAW ITS PROTEST. NSF
AWARDED THE CONTRACT TO SPESER. P&F PROTESTED THE AGENCY'S ACTIONS TO
OUR OFFICE IN A LETTER RECEIVED BY US ON FEBRUARY 7, 1983.
UNDER OUR BID PROTEST PROCEDURES, PROTESTS FILED INITIALLY WITH THE
CONTRACTING AGENCY MUST BE FILED IN OUR OFFICE WITHIN 10 WORKING DAYS OF
ACTUAL OR CONSTRUCTIVE KNOWLEDGE OF INITIAL ADVERSE ACTION. 4 C.F. R.
SEC. 21.2(A) (1983). NSF RESPONDED TO P&F'S PROTEST WITH A DECEMBER 22
DEBRIEFING AND AN AWARD OF THE CONTRACT TO SPESER. THE AWARD OF THE
CONTRACT AND NSF'S REAFFIRMATION OF ITS POSITION AT THE DECEMBER 22
DEBRIEFING CONSTITUTED THE AGENCY'S INITIAL ADVERSE ACTION AGAINST P&
F'S PROTEST. P&F THEREFORE WAS REQUIRED TO FILE AN APPEAL WITH OUR
OFFICE WITHIN 10 WORKING DAYS. SEE JENSON CORPORATION, B-206692, MARCH
22, 1982, 82-1 CPD 271. P&F DID NOT DO SO. IT INSTEAD WAITED UNTIL
FEBRUARY 7, 1983, A MONTH AND A HALF LATER, TO FILE ITS APPEAL. THE
PROTEST THEREFORE IS UNTIMELY AND WILL NOT BE CONSIDERED BY OUR OFFICE.
B-210733 L/M, FEB 25, 1983
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
PAUL SIMON, HOUSE OF REPRESENTATIVES:
THIS IS IN RESPONSE TO YOUR LETTER DATED JANUARY 26, 1983, REQUESTING
A LEGAL OPINION FROM OUR OFFICE IN CONNECTION WITH TWO PROVISIONS
CONTAINED IN REGULATIONS RECENTLY PROPOSED BY THE DEPARTMENT OF
EDUCATION (DEPARTMENT).
ON JANUARY 27, 1983, THE DEPARTMENT PUBLISHED IN THE FEDERAL REGISTER
A NOTICE OF PROPOSED RULEMAKING (NPRM), 48 FED.REG. 3920, TO IMPLEMENT
THE PROVISIONS OF SECTION 1113 OF THE DEPARTMENT OF DEFENSE
AUTHORIZATION ACT, 1983, PUB.L. NO. 97-252, 96 STAT. 718, 748, APPROVED
SEPTEMBER 8, 1982. SECTION 1113 OF PUB.L. NO. 97-252 AMENDED SECTION 12
OF THE MILITARY SELECTIVE SERVICE ACT, 50 U.S.C. APP. SEC. 462, TO
PROVIDE THAT ANY STUDENT WHO IS REQUIRED TO REGISTER WITH THE SELECTIVE
SERVICE AND WHO FAILS TO DO SO IS INELIGIBLE FOR STUDENT FINANCIAL
ASSISTANCE PROVIDED UNDER TITLE IV OF THE HIGHER EDUCATION ACT OF 1965,
20 U.S.C. SEC. 1070 ET SEQ.
SPECIFICALLY YOU ASK US WHETHER THE SECRETARY OF EDUCATION HAS THE
AUTHORITY TO ISSUE REGULATIONS THAT WOULD:
(1) "*** DENY INTEREST PAYMENTS ON GUARANTEED
STUDENT LOANS IF STUDENTS REFUSE TO COMPLY WITH
REGISTRATION REQUIREMENTS AS IMPLEMENTED BY THE
PROPOSED REGULATION; (SEC. 668.24(B)(3)(II) OF
THE NPRM) AND
(2) "*** DIRECT HIGHER EDUCATION INSTITUTIONS
TO INFORM LENDERS IF STUDENTS WHO HAVE GUARANTEED
STUDENT LOANS FAIL TO COMPLY WITH THE
REGULATIONS." (SEC. 668.26(E)(5)(II)(A) OF THE NPRM).
IN ACCORDANCE WITH OUR GENERAL POLICY IN SUCH MATTERS WE REQUESTED
THE DEPARTMENT TO FURNISH US WITH ITS VIEWS AND COMMENTS CONCERNING THE
QUESTIONS YOU RAISE. BASED ON THE INFORMATION CONTAINED IN THE
DEPARTMENT'S RESPONSE, A COPY OF WHICH IS ENCLOSED, TOGETHER WITH OUR
OWN ANALYSIS OF THE LEGISLATION AND REGULATIONS INVOLVED, IT APPEARS TO
US THAT THE PROPOSED REGULATIONS WOULD, IF ISSUED, BE WITHIN THE
AUTHORITY OF THE SECRETARY. HOWEVER, WE BELIEVE THAT THE INTENDED
MEANING AND APPLICABILITY OF SECTION 668.24(B)(3)(II) OF THE NPRM IS NOT
ENTIRELY CLEAR ON THE QUESTION OF THE CONTINUED EXISTENCE OF THE
GUARANTEE IN THE EVENT OF A STUDENT'S DEFAULT AFTER A DETERMINATION OF
INELIGIBILITY. THEREFORE SOME ADDITIONAL MODIFICATIONS OF THE PROPOSED
REGULATIONS BY THE DEPARTMENT MIGHT BE DESIRABLE TO CLARIFY THEIR
INTENDED MEANING.
YOUR QUESTIONS RELATE TO THE IMPACT OF THE PROPOSED REGULATIONS ON
THE GUARANTEED STUDENT LOAN PROGRAM. THAT PROGRAM WAS ESTABLISHED BY
TITLE IV OF THE HIGHER EDUCATION ACT OF 1965, AS AMENDED, 20 U.S.C.
SECS. 1070 ET SEQ., TO MAKE LOW INTEREST LOANS AVAILABLE TO
POST-SECONDARY STUDENTS TO HELP THEM MEET THEIR EDUCATIONAL EXPENSES.
LOANS ARE GUARANTEED EITHER BY STATE AGENCIES (AND REINSURED BY THE
FEDERAL GOVERNMENT) OR BY THE DEPARTMENT DIRECTLY. IN EITHER CASE THE
DEPARTMENT WILL PAY THE INTEREST ON THE LOAN TO THE LENDER WHILE THE
STUDENT IS ATTENDING A POST-SECONDARY INSTITUTION IF THE STUDENT
QUALIFIES UNDER THE INTEREST SUBSIDY PROVISION OF THE LEGISLATION. SEE
20 U.S.C. SEC. 1078. YOUR FIRST QUESTION CONCERNS THE AUTHORITY OF THE
DEPARTMENT UNDER THE PROPOSED REGULATION TO TERMINATE THESE INTEREST
PAYMENTS TO INSURED LENDERS.
SECTION 1113 OF PUB.L. NO. 97-252 AMENDED SECTION 12 OF THE MILITARY
SELECTIVE SERVICE ACT, 50 U.S.C. APP. SEC. 462 BY ADDING THE FOLLOWING
NEW SUBSECTION:
"(F)(1) ANY PERSON WHO IS REQUIRED UNDER
SECTION 3 TO PRESENT HIMSELF FOR AND SUBMIT TO
REGISTRATION UNDER SUCH SECTION AND FAILS TO DO
SO IN ACCORDANCE WITH ANY PROCLAMATION ISSUED
UNDER SUCH SECTION, OR IN ACCORDANCE WITH ANY
RULE OR REGULATION ISSUED UNDER SUCH SECTION,
SHALL BE INELIGIBLE FOR ANY FORM OF ASSISTANCE
OR BENEFIT PROVIDED UNDER TITLE IV OF THE
HIGHER EDUCATION ACT OF 1965.
"(2) IN ORDER TO RECEIVE ANY GRANT, LOAN,
OR WORK ASSISTANCE UNDER TITLE IV OF THE HIGHER
EDUCATION ACT OF 1965 (20 U.S.C. 1070 ET SEQ.),
A PERSON WHO IS REQUIRED UNDER SECTION 3 TO
PRESENT HIMSELF FOR AND SUBMIT TO REGISTRATION
UNDER SUCH SECTION SHALL FILE WITH THE
INSTITUTION OF HIGHER EDUCATION WHICH THE
PERSON INTENDS TO ATTEND, OR IS ATTENDING, A
STATEMENT OF COMPLIANCE WITH SECTION 3 AND
REGULATIONS ISSUED THEREUNDER.
"(3) THE SECRETARY OF EDUCATION, IN AGREEMENT
WITH THE DIRECTOR, SHALL PRESCRIBE METHODS
FOR VERIFYING SUCH STATEMENTS OF COMPLIANCE
FILED PURSUANT TO PARAGRAPH (2). SUCH METHODS
MAY INCLUDE REQUIRING INSTITUTIONS OF HIGHER
EDUCATION TO PROVIDE A LIST TO THE SECRETARY OF
EDUCATION OR TO THE DIRECTOR OF PERSONS WHO
HAVE SUBMITTED SUCH STATEMENTS OF COMPLIANCE.
"(4) THE SECRETARY OF EDUCATION, IN
CONSULTATION WITH THE DIRECTOR, SHALL ISSUE
REGULATIONS TO IMPLEMENT THE REQUIREMENTS OF
THIS SUBSECTION. SUCH REGULATIONS SHALL
PROVIDE THAT ANY PERSON TO WHOM THE SECRETARY
OF EDUCATION PROPOSES TO DENY ASSISTANCE OR
BENEFITS UNDER TITLE IV FOR FAILURE TO MEET THE
REGISTRATION REQUIREMENTS OF SECTION 3 AND
REGULATIONS ISSUED THEREUNDER SHALL BE GIVEN
NOTICE OF THE PROPOSED DENIAL AND SHALL HAVE A
SUITABLE PERIOD (OF NOT LESS THAN THIRTY DAYS)
AFTER SUCH NOTICE TO PROVIDE THE SECRETARY WITH
INFORMATION AND MATERIALS ESTABLISHING THAT HE
HAS COMPLIED WITH THE REGISTRATION REQUIREMENT
UNDER SECTION 3. SUCH REGULATIONS SHALL ALSO
PROVIDE THAT THE SECRETARY MAY AFFORD SUCH
PERSON AN OPPORTUNITY FOR A HEARING TO ESTABLISH
HIS COMPLIANCE OR FOR ANY OTHER PURPOSE." SUBSECTION (B) OF SECTION
1113 FURTHER PROVIDES THAT THE ABOVE-QUOTED AMENDMENT TO THE MILITARY
SELECTIVE SERVICE ACT "SHALL APPLY TO LOANS, GRANTS, OR WORK ASSISTANCE
UNDER TITLE IV OF THE HIGHER EDUCATION ACT FOR PERIODS OF INSTRUCTION
BEGINNING AFTER JUNE 30, 1983."
THE REGULATIONS PROPOSED BY THE DEPARTMENT TO IMPLEMENT THIS
LEGISLATION REQUIRE THAT UNLESS THE STUDENT APPLYING FOR AID FILES A
STATEMENT OF REGISTRATION COMPLIANCE WITH THE EDUCATIONAL INSTITUTION,
THE INSTITUTION MAY NOT DISBURSE ANY FUNDS TO THE STUDENT UNDER ANY
TITLE IV AID PROGRAM OR CERTIFY THE INSTITUTIONAL PORTION OF THE
GUARANTEED STUDENT LOAN APPLICATION OR ANY OTHER APPLICATION FOR TITLE
IV AID. HOWEVER, IN RECOGNITION OF THE LIKELIHOOD THAT BEFORE THE
DEPARTMENT WOULD BE ABLE TO PUBLISH FINAL REGULATIONS IMPLEMENTING THE
LEGISLATION SOME STUDENTS MAY HAVE APPLIED FOR AND/OR RECEIVED OR
BENEFITED FROM A LOAN INTENDED FOR A PERIOD OF INSTRUCTION AFTER JUNE
30, 1983, THE PROPOSED REGULATIONS HAVE CERTAIN PROVISIONS THAT APPLY
ONLY TO THOSE SITUATIONS. THE PROPOSED REGULATIONS (SEC. 668.24(B))
PROVIDE AS FOLLOWS IN THIS RESPECT:
"(3)(I) AN INSTITUTION SHALL NOTIFY THE
LENDER AND THE SECRETARY IF IT DETERMINES THAT
A STUDENT WHO HAS ALREADY RECEIVED OR BENEFITED
FROM A LOAN INTENDED FOR A PERIOD OF INSTRUCTION
BEGINNING ON OR AFTER JULY 1, 1983 FAILS
TO FILE AND VERIFY A STATEMENT OF REGISTRATION
COMPLIANCE IN ACCORDANCE WITH THIS SECTION AND
SECS. 668.26 AND 668.27.
"(II) A STUDENT WHO FAILS TO FILE AND
VERIFY THE REQUIRED STATEMENT FORFEITS THE
RIGHT TO RECEIVE OR RETAIN THE LOAN CHECK OR
ITS BENEFITS, AS WELL AS THE RIGHT TO THE
PAYMENT OF INTEREST BENEFITS ON THAT LOAN. THE
BORROWER SHALL, IF DEMANDED BY THE LENDER,
IMMEDIATELY REPAY THAT DISBURSEMENT."
YOUR LETTER POSES THE FOLLOWING QUESTIONS IN CONNECTION WITH SECTION
668.24(B)(3)(II):
"A POSSIBLE INTERPRETATION OF THAT PROVISION IS
THAT IF A STUDENT HAS ALREADY RECEIVED THE LOAN
AND FAILS TO REGISTER FOR THE DRAFT, THE
FEDERAL GOVERNMENT CAN HALT INTEREST PAYMENTS
TO LENDING INSTITUTIONS. WERE THAT THE CASE,
WOULD THE FEDERAL GOVERNMENT BE VIOLATING A
CONTRACT WITH THE LENDING INSTITUTION? WHAT
WOULD BE THE LEGAL RAMIFICATIONS FOR THE
FEDERAL GOVERNMENT?"
IN OUR VIEW, THE INTENDED MEANING OF SECTION 668.24(B)(3)(II) AS IT
RELATES TO THE RIGHTS OF THE LENDER WHO DISBURSES THE GUARANTEED STUDENT
LOAN AND WHO WOULD OTHERWISE RECEIVE INTEREST PAYMENTS FROM THE
DEPARTMENT IS UNCLEAR. HOWEVER, WE HAVE BEEN ADVISED BY THE DEPARTMENT
THAT THE INTERPRETATION SUGGESTED IN YOUR LETTER IS IN FACT THE INTENDED
ONE. THAT IS, THE LENDER WOULD LOSE ITS RIGHT TO RECEIVE THE INTEREST
SUBSIDY PAYMENT FROM THE DEPARTMENT SINCE THE STUDENT WHO RECEIVED THE
LOAN WAS INELIGIBLE UNDER THE NEW LEGISLATION BY REASON OF THE STUDENT'S
FAILURE TO DEMONSTRATE COMPLIANCE WITH THE DRAFT REGISTRATION
REQUIREMENT. HOWEVER, IT IS THE DEPARTMENT'S POSITION THAT THE
INELIGIBLE STUDENT WOULD BE FULLY LIABLE FOR REPAYING THE LOAN AND
INTEREST TO THE LENDER AND THAT IN THE EVENT OF THE STUDENT'S DEFAULT,
THE LENDER WOULD BE ENTITLED TO PAYMENT OF THE FULL LOAN AMOUNT,
INCLUDING INTEREST, UNDER THE TERMS OF ITS GUARANTEE EITHER FROM THE
DEPARTMENT OR THE GUARANTEE AGENCY.
WE AGREE WITH THE DEPARTMENT THAT UNDER SECTION 1113(B) OF PUB.L.
NO. 97-252, A STUDENT WHO RECEIVES A GUARANTEED STUDENT LOAN, OR OTHER
FEDERAL AID UNDER TITLE IV, FOR A PERIOD OF INSTRUCTION AFTER JUNE 30,
1983, IS NOT ELIGIBLE TO RECEIVE SUCH ASSISTANCE IF HE IS REQUIRED TO
REGISTER FOR THE DRAFT AND FAILS TO PROVIDE EVIDENCE THAT HE HAS DONE
SO. THIS IS TRUE EVEN IF THE STUDENT RECEIVED THE LOAN PRIOR TO THAT
DATE UNDER THE CURRENT REGULATIONS THAT DO NOT REQUIRE THE STUDENT TO
SHOW THAT HE HAS REGISTERED FOR THE DRAFT (ASSUMING, OF COURSE, THAT THE
LOAN HAD NOT BEEN MADE BEFORE SEPTEMBER 8, 1982, WHEN PUB.L. NO. 97-252
WAS APPROVED). THIS INTERPRETATION OF THE LEGISLATION IS MANDATED BY
THE EXPRESS LANGUAGE OF SECTION 1113(B) AND IS NOT CONTRADICTED BY
ANYTHING IN THE LEGISLATIVE HISTORY. OBVIOUSLY, THEREFORE, IF THE
STUDENT WAS NOT ELIGIBLE FOR THE LOAN FROM ITS INCEPTION, HE WOULD NOT
BE ELIGIBLE FOR THE FEDERAL SUBSIDY PAYMENT PROVIDED FOR IN 20 U.S.C.
SEC. 1078(A).
THE QUESTION REMAINS, HOWEVER, WHETHER THE SAME THING CAN BE SAID
WITH RESPECT TO THE RIGHTS OF THE LENDER TO RECEIVE INTEREST SUBSIDY
PAYMENTS FROM THE DEPARTMENT. IN THIS RESPECT A PROVISION SET FORTH IN
20 U.S.C. SEC. 1078(A)(3)(A) MUST BE CONSIDERED. THAT PROVISION READS
AS FOLLOWS:
"*** THE HOLDER OF A LOAN WITH RESPECT TO
WHICH PAYMENTS ARE REQUIRED TO BE MADE UNDER
THIS SECTION SHALL BE DEEMED TO HAVE A
CONTRACTUAL RIGHT, AS AGAINST THE UNITED
STATES, TO RECEIVE FROM THE SECRETARY THE
PORTION OF INTEREST WHICH HAS BEEN SO DETERMINED. ***" WHILE IT
MIGHT BE ARGUED THAT UNDER THIS PROVISION THE LENDER HAS A VESTED RIGHT
TO COLLECT INTEREST PAYMENTS FROM THE UNITED STATES THAT IS INDEPENDENT
OF THE RIGHT OF THE STUDENT TO RECEIVE THE BENEFITS OF THE FEDERAL
SUBSIDY AND THEREFORE CANNOT BE TERMINATED BY THE PROPOSED REGULATIONS,
WE WOULD NOT BE INCLINED TO AGREE WITH THIS INTERPRETATION FOR SEVERAL
REASONS.
FIRST, FROM A PURELY LOGICAL ANALYSIS IT MAKES LITTLE SENSE, IN OUR
VIEW, TO HOLD THAT WHILE THE STUDENT LOSES HIS RIGHT TO RECEIVE A
GUARANTEED STUDENT LOAN AND THE BENEFITS OF THE FEDERAL INTEREST PAYMENT
BECAUSE OF HIS FAILURE TO REGISTER FOR THE DRAFT, THE LENDER THAT IS
RECEIVING THE INTEREST PAYMENT FROM THE DEPARTMENT ON BEHALF OF THE
STUDENT HAS AN INDEPENDENT RIGHT TO CONTINUE TO RECEIVE SUCH PAYMENTS.
IN THIS RESPECT 20 U.S.C. SEC. 1078(A)(1) SPECIFICALLY STATES THAT THE
INTEREST SUBSIDY IS BEING PAID ON THE STUDENT'S "BEHALF AND FOR HIS
ACCOUNT." THEREFORE WHEN THE STUDENT LOSES HIS ELIGIBILITY OR IS
DETERMINED NEVER TO HAVE BEEN ELIGIBLE FOR THE SUBSIDY PAYMENTS, THE
LENDER CANNOT REMAIN ENTITLED TO RECEIVE THOSE PAYMENTS FROM THE
DEPARTMENT.
THIS SITUATION IS VERY SIMILAR TO WHAT HAPPENS WHEN A LENDER LEARNS
AFTER DISBURSING A LOAN THAT THE STUDENT IS NOT ELIGIBLE BECAUSE HE HAS
NOT BEEN OR WILL NOT BE A STUDENT ENROLLED IN A PARTICIPATING SCHOOL ON
AT LEAST A HALF-TIME BASIS. IN THIS SITUATION, THE REGULATIONS
CURRENTLY IN EFFECT PROVIDE THAT "THE LENDER SHALL *** CEASE BILLING THE
SECRETARY FOR INTEREST PAYMENTS ON THE BORROWER'S BEHALF, SINCE NO
FURTHER INTEREST BENEFITS ON THAT LOAN ARE PAYABLE ***." SEE 34 C.F.R.
SEC. 682.507(E).
SECOND, AND PERHAPS MORE IMPORTANTLY, IT APPEARS, BASED ON THE
INFORMATION PROVIDED TO US BY THE DEPARTMENT AND ON OUR OWN ANALYSIS OF
THE RELEVANT STATUTES AND REGULATIONS, THAT THE ULTIMATE RIGHTS OF THE
LENDER WOULD BE PROTECTED IF THE PROPOSED REGULATION IS ADOPTED. WHEN
THE STUDENT, BY REASON OF HIS FAILURE TO FILE AND VERIFY THE REQUIRED
STATEMENT OF REGISTRATION COMPLIANCE, LOSES HIS RIGHT TO RECEIVE OR
RETAIN THE LOAN AS WELL AS PAYMENT OF THE INTEREST SUBSIDY BY THE
DEPARTMENT, HE REMAINS OBLIGATED TO REPAY THE FULL AMOUNT OF THE LOAN TO
THE LENDER. IN THIS RESPECT, THE PROPOSED REGULATION SECIFICALLY STATES
THAT THE "BORROWER SHALL IF DEMANDED BY THE LENDER, FULLY REPAY THAT
DISBURSEMENT." PRESUMABLY THIS WOULD INCLUDE ANY ACCRUED INTEREST,
ALTHOUGH IN OUR OPINION, THE PROPOSED REGULATION AND THE ACCOMPANYING
LOAN AGREEMENT SHOULD BE AMENDED TO MAKE THIS CLEAR AS WELL AS THE
BORROWER'S LIABILITY TO REPAY ANY INTEREST THAT HAD ALREADY BEEN PAID TO
THE LENDER BY THE DEPARTMENT.
FURTHERMORE, IF THE INELIGIBLE STUDENT DOES NOT REPAY THE LOAN UPON
DEMAND BY THE LENDER, HE CAN BE DECLARED IN DEFAULT. SEE THE DEFINITION
OF DEFAULT IN 34 CFR SEC. 682.200. AT THAT TIME, THE INSURED LENDER CAN
FILE A CLAIM EITHER WITH THE GUARANTEE AGENCY OR THE DEPARTMENT,
DEPENDING ON THE TYPE OF LOAN INVOLVED. THE DEPARTMENT'S RESPONSE
SPECIFICALLY STATES THAT UNDER THE PROPOSED REGULATIONS, THE INSURANCE
WOULD REMAIN IN EFFECT EVEN IF THE STUDENT WAS INELIGIBLE BECAUSE OF HIS
FAILURE TO REGISTER. WE UNDERSTAND THAT THIS IS THE PROCEDURE CURRENTLY
FOLLOWED IN THE CASE OF STUDENTS DETERMINED INELIGIBLE FOR NOT ENROLLING
FOR THE REQUIRED NUMBER OF COURSES.
WHEN THE DEFAULT CLAIM IS PAID THE LENDER WOULD RECEIVE ALL OF THE
ACCRUED UNPAID INTEREST IN ADDITION TO THE OUTSTANDING BALANCE DUE ON
THE LOAN. IN FACT, IT IS THE DEPARTMENT'S POSITION THAT UNDER 20 U.S.
C. SECS. 1078-1(A)(1)(B) AND 1080(A) THE LENDER COULD FILE A DEFAULT
CLAIM IF THE STUDENT DOES NOT PAY THE REQUIRED INTEREST AFTER THE
STUDENT BECOMES INELIGIBLE FOR THE FEDERAL INTEREST PAYMENTS.
ACCORDINGLY, THE ULTIMATE RIGHTS OF THE LENDER TO RECOVER THE FULL
AMOUNT OF THE LOAN PLUS ANY UNPAID INTEREST WOULD BE PRESERVED.
ALTHOUGH THE PROPOSED REGULATIONS DO NOT CLEARLY SET FORTH THE LENDER'S
RIGHTS IN THIS RESPECT, WE BELIEVE THAT WHERE A LENDER MAKES A LOAN THAT
UNDER THE REGULATIONS AND LOAN AGREEMENTS IN EFFECT AT THE TIME IS A
VALID ONE, A CONTRARY RESULT WOULD NOT BE REASONABLE AND IN ALL
LIKELIHOOD COULD NOT BE SUSTAINED IN COURT. NEVERTHELESS, WE WOULD
RECOMMEND THAT THE PROPOSED REGULATION BE CLARIFIED SO THAT IT EXPRESSLY
SETS FORTH THE LENDER'S RIGHTS TO RECOVER THE FULL AMOUNT OF THE LOAN
PLUS INTEREST BY FILING A CLAIM WITH THE APPROPRIATE AGENCY ONCE THE
STUDENT-BORROWER DEFAULTS.
YOUR SECOND QUESTION CONCERNS THE VALIDITY OF SECTION 668.26(E)(5)(
II)(A) OF THE NPRM WHICH PROVIDES AS FOLLOWS:
"IF THE INSTITUTION CERTIFIES THE INSTITUTIONAL
PORTION OF AN APPLICATION UNDER THE GUARANTEED
STUDENT LOAN OR PLUS PROGRAM FOR A STUDENT WHO
FAILS TO SUBMIT THE REQUIRED DOCUMENTATION
WITHIN ONE HUNDRED TWENTY (120) DAYS, THE
INSTITUTION SHALL NOTIFY THE LENDER AND THE SECRETARY." SPECIFICALLY
YOU ASK WHETHER THAT PROVISION CONFLICTS WITH THE TERMS OF THE FAMILY
EDUCATIONAL RIGHTS AND PRIVACY ACT OF 1974, AS AMENDED, 20 U.S.C. SEC.
1232G "WHICH OUTLINES TO WHOM HIGHER EDUCATION INSTITUTIONS MAY RELEASE
INFORMATION ON STUDENTS." WE DO NOT BELIEVE ANY SUCH CONFLICT EXISTS.
AS YOU INDICATE, 20 U.S.C. SEC. 1232G PROVIDES THAT NO FEDERAL FUNDS
SHOULD BE MADE AVAILABLE TO ANY EDUCATIONAL INSTITUTION WHICH PERMITS
"THE RELEASE OF EDUCATION RECORDS (OR PERSONALLY IDENTIFIABLE
INFORMATION CONTAINED THEREIN ***") OF STUDENTS WITHOUT THE WRITTEN
CONSENT OF THEIR PARENTS TO ANY INDIVIDUAL, AGENCY, OR ORGANIZATION,
***" OTHER THAN THOSE SPECIFIED IN THE STATUTE. INCLUDED WITHIN THE
LIST OF EXCEPTIONS TO THE STATUTORY PROHIBITION, HOWEVER, IS ANY
INFORMATION RELEASED "IN CONNECTION WITH A STUDENT'S APPLICATION FOR, OR
RECEIPT OF, FINANCIAL AID." SEE 20 U.S.C. SEC. 1232G(B)(1)(D).
ACCORDINGLY, IT IS CLEAR THAT THIS LEGISLATION DOES NOT PREVENT A
SCHOOL FROM INFORMING A LENDER THAT A STUDENT IS NOT ELIGIBLE FOR
FEDERAL AID BECAUSE HE FAILED TO VERIFY HIS COMPLIANCE WITH THE DRAFT
REGISTRATION LAWS.
WE TRUST THAT THE FOREGOING INFORMATION WILL BE HELPFUL TO YOU.
B-210732.2, NOV 10, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO, EXCEPT IN LIMITED CIRCUMSTANCES, WILL
NOT REVIEW A POTENTIAL SUBCONTRACTOR'S PROTEST OF THE AWARD OF A
SUBCONTRACT SINCE THE MATTER INVOLVES CONTRACT ADMINISTRATION.
2. CONTENTION THAT PRIME CONTRACTOR IS SUPPLYING
VEHICLES WITH NONCONFORMING LIGHTING SYSTEMS IS A MATTER OF
CONTRACT ADMINISTRATION NOT FOR REVIEW UNDER GAO'S BID PROTEST
PROCEDURES.
WHELEN ENGINEERING COMPANY, INC.:
WHELEN ENGINEERING COMPANY, INC. COMPLAINS THAT THE LIGHTING SYSTEMS
SUPPLIED BY FEDERAL SIGNAL COMPANY TO SOUTHERN AMBULANCE BUILDERS, INC.,
THE PRIME CONTRACTOR, FOR AMBULANCES UNDER A CONTRACT AWARDED BY THE U.
S. ARMY TANK-AUTOMOTIVE COMMAND, DO NOT MEET THE CONTRACT REQUIREMENTS.
WHELEN, A POTENTIAL SUBCONTRACTOR, REQUESTS THAT THESE ALLEGEDLY
DEFICIENT LIGHTING COMPONENTS BE REMOVED FROM THE VEHICLES AND THAT THE
PRIME CONTRACTOR BE REQUIRED TO INSTALL PROPER LIGHTING SYSTEMS FROM
EITHER THE EXISTING SUPPLIER OR THE PROTESTER.
WHELEN SEEMS TO BE PROTESTING BOTH THAT IT WAS IMPROPERLY DENIED A
SUBCONTRACT AWARD TO SUPPLY THE LIGHTING SYSTEMS AND THAT THE ARMY IS
ACCEPTING NONCONFORMING EQUIPMENT. WE WOULD CONSIDER A PROTEST AGAINST
A SUBCONTRACT AWARD ONLY IN CERTAIN LIMITED CIRCUMSTANCES. THE
GOVERNMENT'S PARTICIPATION IN SUBCONTRACT AWARDS GENERALLY INVOLVES ONLY
APPROVAL OF THE PRIME CONTRACTOR'S SELECTION OF A SUBCONTRACTOR, WHICH
IS A FUNCTION OF CONTRACT ADMINISTRATION WHICH WE DO NOT REVIEW UNDER
OUR PROTEST PROCEDURES. SUPREME EQUIPMENT & SYSTEMS CORPORATION,
B-211428, MAY 6, 1983, 83-1 CPD 478. WHELEN'S PROTEST DOES NOT SUGGEST
THAT ANY OF THE LIMITED CIRCUMSTANCES WHICH WOULD WARRANT OUR REVIEW IS
PRESENT HERE.
MOREOVER, WHAT IS DELIVERED UNDER A CONTRACT IS ALSO A MATTER OF
CONTRACT ADMINISTRATION. CONSEQUENTLY, WE ALSO DO NOT CONSIDER, UNDER
OUR BID PROTEST PROCEDURES, 4 C.F.R. 21.3 (1983) AS AMENDED BY 48 FED.
REG. 1932, JANUARY 17, 1983, WHETHER DELIVERED GOODS OR EQUIPMENT
CONFORM TO CONTRACT SPECIFICATIONS.
WE DISMISS THE PROTEST.
B-210732, OCT 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE SHIPPING INFORMATION (VEHICLE DIMENSIONS)
INCLUDED IN BID INDICATES THAT VEHICLE OFFERED DID NOT MEET
SPECIFICATION REQUIREMENTS, BID WAS PROPERLY REJECTED AS
NONRESPONSIVE.
2. INFORMATION IN THE SHIPPING DATA CLAUSE OF A
BID WHICH INDICATES THAT VEHICLE OFFERED DOES NOT CONFORM WITH
DIMENSIONS IN THE SPECIFICATION CONSTITUTES A MATERIAL DEVIATION
AND RENDERS BID NONRESPONSIVE, BECAUSE EVEN THOUGH IT MAY NOT
AFFECT BID PRICE OR SHIPPING COST, IT DOES AFFECT THE QUALITY OF
THE PRODUCT OFFERED.
3. WHERE PROTESTER INITIALLY FILES TIMELY
PROTEST AND LATER SUPPLEMENTS IT WITH NEW AND INDEPENDENT GROUNDS
OF PROTEST, THE LATER GROUNDS OF PROTEST MUST INDEPENDENTLY
SATISFY TIMELINESS REQUIREMENTS. SUCH GROUNDS ARE UNTIMELY WHEN
THEY ARE BASED ON INFORMATION AVAILABLE FROM FACE OF THE AWARDEE'S
BID AND ARE FILED CONSIDERABLY LATER THAN 10 DAYS AFTER BID
OPENING.
STAR-LINE ENTERPRISES, INC.:
STAR-LINE ENTERPRISES, INC. PROTESTS THE REJECTION OF ITS BID AS
NONRESPONSIVE AND THE SUBSEQUENT AWARD OF A CONTRACT TO ANOTHER FIRM
UNDER INVITATION FOR BIDS (IFB) NO. DAAE07-82-B-5745 ISSUED BY THE U.
S. ARMY TANK-AUTOMOTIVE COMMAND. WE DENY THE PROTEST IN PART AND
DISMISS IT IN PART.
THE SOLICITATION CALLED FOR AMBULANCES FOR THE AIR FORCE ON A
MULTIYEAR BASIS. STAR-LINE'S LOW BID WAS REJECTED AS NONRESPONSIVE
BECAUSE OF INFORMATION THE PROTESTER PROVIDED IN THE SOLICITATION CLAUSE
ENTITLED "GUARANTEED MAXIMUM SHIPPING WEIGHTS AND DIMENSIONS." STAR-LINE
STATED IN THAT CLAUSE THAT ITS VEHICLES WERE 91-3/4 INCHES WIDE AND
281-7/8 INCHES LONG. THE SOLICITATION SPECIFICATIONS, HOWEVER, PROVIDED
THAT THE VEHICLES MUST BE NO LESS THAN 95 INCHES WIDE AND NO LONGER THAN
274 INCHES. AFTER STAR-LINE'S BID WAS REJECTED AS NONRESPONSIVE, THE
CONTRACTING AGENCY MADE AWARD TO THE SECOND LOW BIDDER, SOUTHERN
AMBULANCE BUILDERS, INC.
STAR-LINE ARGUES THAT THE INFORMATION REGARDING THE LENGTH AND WIDTH
OF THE AMBULANCES WAS REQUESTED ONLY FOR COMPUTATION OF TRANSPORTATION
COSTS AND WAS NOT TO BE USED IN DETERMINING THE RESPONSIVENESS OF ITS
BID. THE PROTESTER FURTHER STATES THAT THE DIMENSIONS IT PROVIDED IN
THE CLAUSE WOULD NOT MATERIALLY AFFECT TRANSPORTATION COSTS OR ITS
OBLIGATION TO COMPLY WITH THE SPECIFICATIONS. STAR-LINE ALSO ARGUES THAT
THE TRANSPORTATION DATA THAT IT SUPPLIED, WHILE AT VARIANCE WITH THE
VEHICLE SPECIFICATIONS, COULD BE WAIVED BY THE CONTRACTING OFFICER AS A
MINOR INFORMALITY.
THE SHIPPING DATA CLAUSE PROVIDED THAT EACH BID WOULD BE EVALUATED BY
ADDING TO THE F.O.B. ORIGIN PRICE ALL TRANSPORTATION COSTS TO THE
DESTINATION SPECIFIED. IT FURTHER INFORMED BIDDERS THAT IF THE SUPPLIES
DELIVERED EXCEEDED THE GUARANTEED MAXIMUM SHIPPING WEIGHT OR DIMENSIONS,
THE CONTRACT PRICE WOULD BE REDUCED BY AN AMOUNT EQUAL TO THE DIFFERENCE
BETWEEN THE TRANSPORTATION COSTS COMPUTED FOR EVALUATION PURPOSES BASED
ON THE BIDDER'S GUARANTEED MAXIMUM SHIPPING WEIGHTS OR DIMENSIONS AND
THE TRANSPORTATION COSTS THAT SHOULD HAVE BEEN USED FOR EVALUATION
PURPOSES BASED ON CORRECT SHIPPING DATA.
WE HAVE RECOGNIZED, AS STAR-LINE ARGUES, THAT THE PURPOSE OF THIS
TYPE OF CLAUSE IS TO ENABLE THE GOVERNMENT TO ACCURATELY ASCERTAIN ITS
TOTAL COST FOR A PROPOSED CONTRACT AND TO ESTABLISH THE BASIS FOR A
CONTRACT PRICE REDUCTION IN THE EVENT THE MAXIMUM GUARANTEED SHIPPING
WEIGHTS OR DIMENSIONS ARE EXCEEDED. FURTHER, WE HAVE STATED THAT IT IS
PROPER FOR BIDDERS TO USE GUARANTEED SHIPPING DIMENSIONS WHICH ARE LESS
THAN THE ACTUAL DIMENSIONS AS A PERMISSIBLE ALTERNATIVE TO REDUCING THE
PRICE FOR THE ITEM ITSELF. CAPITAL INDUSTRIES, INC., B-190818, JULY 7,
1978, 78-2 CPD 17; GENERAL FIRE EXTINGUISHER CORPORATION, B-186954,
NOVEMBER 15, 1976, 76-2 CPD 413. IN SUCH CASES, HOWEVER, THERE WAS NO
EVIDENCE THAT THE FIGURES INSERTED BY THE BIDDERS IN THE SHIPPING DATA
CLAUSES DEVIATED FROM ANY OF THE SOLICITATIONS' SPECIFICATION
REQUIREMENTS. SEE ALSO 49 COMP.GEN. 558 (1970); W.A. APPLE
MANUFACTURING, INC., B-183791, SEPTEMBER 23, 1975, 75-2 CPD 170.
TO BE RESPONSIVE, A BID AS SUBMITTED MUST REPRESENT AN UNEQUIVOCAL
OFFER TO PERFORM THE EXACT THING CALLED FOR IN THE SOLICITATION SUCH
THAT ACCEPTANCE OF THE BID WILL BIND THE CONTRACTOR TO PERFORM IN
ACCORDANCE WITH THE SOLICITATION'S MATERIAL TERMS AND CONDITIONS.
EDWARD KOCHARIAN & COMPANY, INC., 58 COMP.GEN. 214 (1979), 79-1 CPD 20.
HERE, A VEHICLE CONFORMING TO THE LENGTH AND WIDTH REQUIREMENTS OF THE
SOLICITATION COULD NOT HAVE THE SHIPPING DIMENSIONS CITED IN THE
PROTESTER'S BID. ALTHOUGH THE DIMENSIONS WERE REQUESTED IN CONNECTION
WITH EVALUATION OF SHIPPING COSTS AND NOT SPECIFICALLY TO MEASURE A
BIDDER'S INTENT TO MEET THE SPECIFICATIONS, STAR-LINE'S INSERTION OF
NONCONFORMING DIMENSIONS IN THE SHIPPING DATA CLAUSE AT THE VERY BEST
CREATED AN AMBIGUITY CONCERNING WHETHER THE VEHICLE OFFERED WOULD
CONFORM TO THE SPECIFICATION REQUIREMENTS. SEE PARTICLE DATA, INC.,
B-209419, FEBRUARY 14, 1983, 83-1 CPD 154. CONSEQUENTLY, WE THINK THAT
THE CONTRACTING OFFICER PROPERLY REJECTED THE PROTESTER'S BID AS
NONRESPONSIVE BECAUSE OF THE INFORMATION INCLUDED IN THE SHIPPING DATA
CLAUSE OF STAR-LINE'S BID. SEE B-163181, FEBRUARY 7, 1968, WHERE WE
UPHELD AN AGENCY'S REJECTION OF A BID AS NONRESPONSIVE BECAUSE THE
SHIPPING DATA INCLUDED IN THE BID DEVIATED FROM THE SPECIFICATION
REQUIREMENTS.
STAR-LINE ARGUES THAT EVEN THOUGH ITS SHIPPING DATA INDICATED
DIMENSIONS DIFFERENT FROM THE SPECIFICATION REQUIREMENTS, ANY SUCH
VARIATION HAD ONLY A MINOR EFFECT ON THE VEHICLE AND ON THE SHIPPING
COSTS AND COULD HAVE BEEN WAIVED. WE DISAGREE.
THE AGENCY REPORTS THAT THE AMBULANCE BODY WIDTH REQUIREMENT WAS
NEEDED TO ALLOW SUFFICIENT ROOM INSIDE THE VEHICLE TO PERMIT MEDICAL
PERSONNEL TO WORK ON EITHER SIDE OF A PATIENT FOR THE PERFORMANCE OF
EMERGENCY PROCEDURES WHILE ALLOWING SUFFICIENT INTERIOR SPACE FOR
CABINETS AND COTS. FURTHER, THE AGENCY INDICATES THAT THE VEHICLE
LENGTH REQUIREMENT WAS NECESSARY TO ENSURE VEHICLE MANEUVERABILITY.
STAR-LINE HAS NOT DISPUTED THE AGENCY'S POSITION THAT THESE DIMENSIONS
ARE CRITICAL. IT MERELY ARGUES THAT THEY MAKE NO DIFFERENCE IN
PRODUCTION COSTS AND THUS HAD NO EFFECT ON ITS BID PRICE.
DEVIATIONS IN A BID WHICH AFFECT QUALITY, QUANTITY OR DELIVERY AS
WELL AS THOSE WHICH AFFECT PRICE GO TO THE SUBSTANCE OF THE PROCUREMENT
AND MAY NOT BE WAIVED. VEN-TEL, INC., B-203397, JULY 1, 1981, 81-2 CPD
3. STAR-LINE'S EXCEPTIONS TO THE SPECIFIED LENGTH AND WIDTH OF THE
VEHICLE CLEARLY GO TO THE QUALITY OF THE ITEM SOUGHT, AND THEREFORE ARE
MATERIAL AND COULD NOT BE WAIVED. SEE PIONEER INDUSTRIAL PRODUCTS,
B-209131, MARCH 22, 1983, 83-1 CPD 286. ACCORDINGLY, THE FACT THAT ITS
BID PRICE AND SHIPPING COSTS WOULD NOT BE SIGNIFICANTLY AFFECTED IS NOT
RELEVANT.
STAR-LINE ALSO MAINTAINS THAT ACCEPTANCE OF ITS BID WOULD RESULT IN
SIGNIFICANT MONETARY SAVINGS TO THE GOVERNMENT. STAR-LINE'S
NONRESPONSIVE BID, HOWEVER, WOULD NOT PROVIDE THE GOVERNMENT WITH WHAT
IT NEEDS. MOREOVER, ACCEPTANCE OF A BID WHICH DEVIATES FROM THE
SPECIFICATIONS WOULD BE UNFAIR TO THE OTHER BIDDERS, AND WE HAVE OFTEN
STATED THAT THE IMPORTANCE OF MAINTAINING THE INTEGRITY OF THE
COMPETITIVE BIDDING SYSTEM OUTWEIGHS THE ADVANTAGE OF A MONETARY SAVINGS
THAT WOULD RESULT IF A MATERIAL DEFICIENCY IS WAIVED OR IGNORED. RAD
OIL COMPANY, INC., B-209047, OCTOBER 20, 1982, 82-2 CPD 352.
IN ITS RESPONSE TO THE AGENCY REPORT, STAR-LINE ARGUED FOR THE FIRST
TIME THAT THE BID OF SOUTHERN AMBULANCE BUILDERS WAS MATERIALLY
DEFECTIVE BECAUSE IT LISTED TWO DIFFERENT WEIGHTS FOR THE SAME AMBULANCE
IN DIFFERENT PORTIONS OF THE SHIPPING DATA CLAUSE. STAR-LINE STATED
THAT SINCE ITS PRICE WAS CONSIDERABLY LOWER THAN THAT OF THE AWARDEE,
THE AWARDS SHOULD NOT BE MADE FOR THE TWO SUBSEQUENT PROGRAM YEARS AND
THE OPTIONS FOR INCREASED QUANTITIES NOT EXERCISED.
OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.2(B)(2) (1983), REQUIRE
PROTESTS OF OTHER THAN SOLICITATION IMPROPRIETIES TO BE FILED WITHIN 10
WORKING DAYS AFTER THE BASIS OF PROTEST IS KNOWN OR SHOULD HAVE BEEN
KNOWN, WHICHEVER IS EARLIER. FURTHER, WHERE A PROTESTER INITIALLY FILES
A TIMELY PROTEST AND LATER SUPPLEMENTS IT WITH NEW AND INDEPENDENT
GROUNDS OF PROTEST, THE LATER-RAISED ALLEGATIONS MUST INDEPENDENTLY
SATISFY THESE TIMELINESS REQUIREMENTS. GULTON INDUSTRIES, INC.,
ENGINEERED MAGNETICS DIVISION, B-203635, JULY 20, 1982, 82-2 CPD 59.
THE RECORD SHOWS THAT THE PROCURING AGENCY SENT STAR-LINE A NOTICE OF
AWARD TO SOUTHERN ON JANUARY 28, 1983, CONCURRENTLY WITH THE REJECTION
OF STAR-LINE'S BID. ANY PROTEST OF THE AWARD TO SOUTHERN SHOULD HAVE
BEEN FILED WITHIN 10 WORKING DAYS OF STAR-LINE'S RECEIPT OF THIS LETTER.
SINCE THE PROTESTER'S ALLEGATIONS WERE FIRST FILED WITH OUR OFFICE ON
APRIL 5, 1983, THEY ARE CLEARLY UNTIMELY. SEE AUTOMATED BUSINESS
SERVICES, INC., B-207380, JUNE 30, 1982, 82-1 CPD 639.
IN ANY EVENT, THE SHIPPING WEIGHTS IN SOUTHERN'S BID WERE NOT (AS IN
STAR-LINE'S BID) INCONSISTENT WITH ANY OF THE SOLICITATION REQUIREMENTS,
BECAUSE THERE WERE NO MAXIMUM VEHICLE WEIGHTS STATED IN THE
SOLICITATION. THE AGENCY REPORTS THAT IT SIMPLY WILL USE THE HEAVIER
VEHICLE WEIGHTS IN CALCULATING THE SHIPPING COSTS. FINALLY, WHETHER THE
AGENCY WILL EXERCISE THE OPTION FOR INCREASED QUANTITY AT PARAGRAPH H17
OF THE SOLICITATION IS A MATTER OF CONTRACT ADMINISTRATION OUTSIDE THE
AMBIT OF OUR BID PROTEST PROCEDURES. TRI STATE SERVICE COMPANY,
B-208567, JANUARY 17, 1983, 83-1 CPD 44.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
B-210730, SEP 27, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE IFB IDENTIFIES PREVIOUSLY APPROVED
SOURCE CONTROLLED COMPONENTS AND REQUIRES
BIDDER TO CERTIFY THAT IT WILL FURNISH ONLY
THOSE COMPONENTS, BIDDER'S FAILURE TO CERTIFY REQUIRES REJECTION OF
BID AS NONRESPONSIVE.
ABSENT SUCH CERTIFICATION, BIDDER
COULD, IN ACCORDANCE WITH THE NOTES ON THE
SOURCE CONTROL DRAWINGS, OFFER ALTERNATIVE
COMPONENTS FOR THE PROCURING AGENCY'S
APPROVAL RATHER THAN THOSE PREVIOUSLY
APPROVED AND IDENTIFIED IN THE IFB, THEREBY
VARYING ITS OBLIGATION FROM THAT INTENDED BY
THE AGENCY.
MVI PRECISION MACHINING, LTD.:
MVI PRECISION MACHINING, LTD., PROTESTS THE REJECTION OF ITS BID AS
NONRESPONSIVE TO THE SOURCE CONTROL CERTIFICATION REQUIREMENT OF IFB NO.
DAA09-83-B-0018 ISSUED BY THE U. S. ARMY ARMAMENT COMMAND, ROCK ISLAND,
ILLINOIS, TO PROCURE MANIFOLD ASSEMBLIES FOR M198 HOWITZERS. WE AGREE
THAT MVI'S FAILURE TO CERTIFY THAT IT WOULD PROVIDE PARTS FROM THE
VENDORS LISTED ON THE SOURCE CONTROL DRAWINGS RENDERED ITS BID
NONRESPONSIVE AND WE DENY THE PROTEST ACCORDINGLY.
THE IFB SPECIFICATIONS INCLUDED SOURCE CONTROL DRAWINGS FOR FIVE
COMPONENTS, EACH DRAWING BEARING THE FOLLOWING NOTATION:
"ONLY THE ITEM DESCRIBED ON THIS DRAWING
WHEN PROCURED FROM THE VENDOR(S) LISTED
HEREON IS APPROVED BY ROCK ISLAND ARSENAL,
ROCK ISLAND, ILL., 61201, FOR USE IN THE
APPLICATION(S) SPECIFIED HEREON. A SUBSTITUTE
ITEM SHALL NOT BE USED WITHOUT PRIOR
APPROVAL BY ROCK ISLAND ARSENAL."
IN ADDITION, AS A WARNING ON ITS FACE PAGE EMPHASIZED, THE
SOLICITATION CONTAINED A SEPARATE CERTIFICATION CLAUSE FOR SOURCE
CONTROLLED ITEMS WHICH PROVIDED:
"K. 8 CERTIFICATION OF SOURCE CONTROLLED
ITEM OR COMPONENTS
THIS SOLICITATION CONTAINS A REQUIREMENT FOR
BIDDERS/OFFERORS TO SUPPLY AN ITEM OR
COMPONENT(S) THAT IS (ARE) IDENTIFIED AS SOURCE
CONTROLLED. THE BIDDER/OFFEROR REPRESENTS
AND CERTIFIES AS PART OF HIS BID/OFFER THAT:
(CHECK BOX)
( ) THE ITEM/COMPONENT(S) BEING OFFERED WILL
BE OBTAINED FROM ONLY THE APPROVED SOURCE(S)
IDENTIFIED ON THE SOURCE CONTROL DRAWING(S).
CAUTION: IF THIS IS A FORMALLY ADVERTISED
PROCUREMENT, FAILURE TO COMPLETE THIS CERTIFICATION
WILL RENDER THE BID NONRESPONSIVE."
FOURTEEN FIRMS RESPONDED TO THE SOLICITATION. BECAUSE MVI'S BID WAS
LOW, THE CONTRACTING OFFICER REQUESTED AND RECEIVED A PREAWARD SURVEY OF
MVI BEFORE DISCOVERING THAT THE FIRM HAD FAILED TO CHECK THE BOX IN
CLAUSE K.8, QUOTED ABOVE. THE CONTRACTING OFFICER THEN CONCLUDED THAT
MVI'S BID WAS NONRESPONSIVE, AS WERE THE NEXT FOUR LOW BIDS FOR THE SAME
REASON. HE THEN DETERMINED THAT ALL OF THE REMAINING BIDS WERE
UNREASONABLE AS TO PRICE AND CANCELED THE SOLICITATION.
THE ARMY EXPLAINS THAT THE CERTIFICATION IS NEEDED TO ALERT BIDDERS
TO THE FACT THAT ONLY CERTAIN APPROVED COMPONENTS WILL FULFILL THE
GOVERNMENT'S REQUIREMENTS AND TO ENABLE THE GOVERNMENT TO ASCERTAIN THAT
THE SOURCES OF THE COMPONENTS WHICH THE BIDDER IS OFFERING HAVE BEEN
APPROVED AT THE TIME OF BID OPENING. OTHERWISE, THE ARMY ARGUES,
BIDDERS WOULD BE ABLE TO PROPOSE THE USE OF SUBSTITUTE ITEMS AFTER BID
OPENING, SINCE THE LEGEND ON THE SOURCE CONTROL DRAWINGS SIMPLY STATES
THAT ALTERNATES SHALL NOT BE USED WITHOUT THE AGENCY'S APPROVAL.
ACCORDING TO THE ARMY, ITS EXPERIENCE WITH THE DRAWING LEGEND HAS BEEN
UNSATISFACTORY BECAUSE, DESPITE THE REQUIREMENT FOR PRIOR APPROVAL OF
SUBSTITUTES, CONTRACTORS NEVERTHELESS MANUFACTURE AND SUBMIT PRODUCTS
WHICH HAVE NOT BEEN APPROVED, RESULTING IN LENGTHY DELAYS AND ADDITIONAL
COSTS. THE ARMY STATES THAT THE CERTIFICATION CLAUSE WAS FASHIONED TO
AVOID THESE PROBLEMS.
WE FIRST NOTE THAT MVI DID NOT OBJECT TO THE USE OF THE CERTIFICATION
CLAUSE PRIOR TO BID OPENING AND THAT EVEN NOW ITS ARGUMENTS DO NOT
DIRECTLY CHALLENGE THE APPROPRIATENESS OF THE ARMY'S ATTEMPT TO RESTRICT
CONSIDERATION OF SOURCE CONTROLLED COMPONENTS TO THOSE APPROVED PRIOR TO
THE BID OPENING, THEREBY EFFECTIVELY DELETING THAT PART OF THE DRAWING
LEGEND WHICH, WITH THE ARMY'S PRIOR APPROVAL, PERMITS THE CONTRACTOR TO
SUBSTITUTE OTHER ITEMS FOR THE DESIGNATED SOURCE CONTROLLED ITEMS DURING
PERFORMANCE. ANY SUCH ARGUMENT ATTACKING THE CERTIFICATION CLAUSE
ITSELF WOULD, OF COURSE, HAVE BEEN UNTIMELY AFTER BID OPENING, WHEN THIS
PROTEST WAS FILED. 4 C.F.R. SEC. 21.2(A)(1983). INSTEAD, MVI CONTENDS
THAT THE CERTIFICATION CLAUSE HAS NOT ACHIEVED THE ARMY'S INTENDED
PURPOSE BECAUSE IT FAILS TO VARY THE OBLIGATION IMPOSED UPON THE BIDDER
BY THE DRAWING LEGEND.
IN CONSIDERING A PROTEST INVOLVING AN EARLIER VERSION OF THE SOURCE
CONTROL CLAUSE WHICH REQUIRED THAT THE BIDDER INDICATE ITS SOURCE OF
SUPPLY BY INSERTING THE NAME OF ITS INTENDED SUPPLIERS, WE HELD THAT THE
BIDDER'S FAILURE TO NAME ITS INTENDED SOURCE OF SUPPLY FRUSTRATED THE
PURPOSE OF THE CLAUSE. IN OUR OPINION, THE BIDDER WAS NOT OTHERWISE
OBLIGATED TO FURNISH THE PRODUCT OF A SOURCE THAT HAD BEEN APPROVED BY
THE TIME BIDS WERE OPENED AND THAT, CONSEQUENTLY, A BID THAT FAILED TO
COMPLY WITH THE CLAUSE WAS NOT RESPONSIVE. BADO ENGINEERING,
B-203202.2, OCTOBER 6, 1981, 81-2 CPD 282; SEE ALSO J.M. T. MACHINE
COMPANY, B-199650, NOVEMBER 19, 1980, 80-2 CPD 382.
MVI ARGUES THAT THESE PRIOR CASES ARE INAPPOSITE BECAUSE UNDER THE
PREVIOUS CLAUSE THE BIDDER ACTUALLY WAS TO LIST ITS INTENDED SOURCE OF
SUPPLY, WHICH IS NOT POSSIBLE WITH THE PRESENT CERTIFICATION. MVI
ARGUES THAT, CONSEQUENTLY, WHEN IT SUBMITTED ITS BID WITHOUT
QUALIFICATION, IT BOUND ITSELF TO COMPLY WITH THE LEGEND ON THE SOURCE
CONTROL DRAWINGS AND THAT MERELY CHECKING THE CERTIFICATION CLAUSE IN NO
WAY VARIES THAT OBLIGATION.
WE DO NOT AGREE. THE BIDDER'S FAILURE TO CERTIFY DOES AFFECT ITS
OBLIGATION TO PERFORM IN ACCORDANCE WITH THE IFB BECAUSE, ABSENT SUCH
CERTIFICATION, THE NOTES ON THE SOURCE CONTROL DRAWINGS DO NOT LIMIT THE
BIDDER TO SOURCES APPROVED PRIOR TO BID OPENING. J.M.T. MACHINE CO.,
SUPRA. HOWEVER, UNDER THE CERTIFICATION, THE BIDDER IS OBLIGATED TO
FURNISH ONLY ITEMS FROM APPROVED SOURCES "IDENTIFIED ON THE SOURCE
CONTROL DRAWING(S)," THAT IS, FROM APPROVED SOURCES LISTED ON THE
DRAWINGS AT THE TIME BIDS ARE OPENED. CONSEQUENTLY, BECAUSE THE
CERTIFICATION CLAUSE IMPOSES A DIFFERENT OBLIGATION THAN THAT SET FORTH
ON THE INDIVIDUAL SOURCE CONTROL DRAWINGS, MVI'S FAILURE TO CERTIFY
RENDERED ITS BID NONRESPONSIVE.
THE PROTEST IS DENIED.
B-210727, MAR 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST ON BASIS THAT BIDDER IS DEBARRED FROM RECEIVING GOVERNMENT
CONTRACTS IS DENIED WHERE BIDDER IS NOT INCLUDED ON ANY DEBARRED BIDDERS
LIST.
W.M.GRACE, INC.:
W.M.GRACE, INC. (GRACE), PROTESTS THE AWARD OF A CONTRACT FOR
JANITORIAL SERVICES BY THE FEDERAL AVIATION ADMINISTRATION TO HOOVER
MAINTENANCE (HOOVER) ON THE BASIS THAT THE PRINCIPALS OF HOOVER WERE THE
PRINCIPALS OF WORLD'S BEST, A FIRM WHICH HAS, ALONG WITH ITS PRINCIPALS,
ALLEGEDLY BEEN DEBARRED FROM RECEIVING GOVERNMENT CONTRACTS.
HOWEVER, WE DO NOT FIND WORLD'S BEST AND ITS PRINCIPALS LISTED ON ANY
GOVERNMENT DEBARRED BIDDERS LIST. THEREFORE, HOOVER IS NOT INELIGIBLE
FOR AN AWARD. SEE B-164946, OCTOBER 4, 1968.
ACCORDINGLY, THE PROTEST IS DENIED.
B-210727, MAR 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST ON BASIS THAT BIDDER IS DEBARRED FROM RECEIVING GOVERNMENT
CONTRACTS IS DENIED WHERE BIDDER IS NOT INCLUDED ON ANY DEBARRED BIDDERS
LIST.
W.M.GRACE, INC.:
W.M.GRACE, INC. (GRACE), PROTESTS THE AWARD OF A CONTRACT FOR
JANITORIAL SERVICES BY THE FEDERAL AVIATION ADMINISTRATION TO HOOVER
MAINTENANCE (HOOVER) ON THE BASIS THAT THE PRINCIPALS OF HOOVER WERE THE
PRINCIPALS OF WORLD'S BEST, A FIRM WHICH HAS, ALONG WITH ITS PRINCIPALS,
ALLEGEDLY BEEN DEBARRED FROM RECEIVING GOVERNMENT CONTRACTS.
HOWEVER, WE DO NOT FIND WORLD'S BEST AND ITS PRINCIPALS LISTED ON ANY
GOVERNMENT DEBARRED BIDDERS LIST. THEREFORE, HOOVER IS NOT INELIGIBLE
FOR AN AWARD. SEE B-164946, OCTOBER 4, 1968.
ACCORDINGLY, THE PROTEST IS DENIED.
B-210726, B-210726.2, MAY 19, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTESTS OF AWARD OF SUBCONTRACT BY DEPARTMENT OF THE NAVY PRIME
CONTRACTOR ARE DISMISSED BECAUSE THE SUBCONTRACT AWARD DOES NOT MEET ANY
OF THE CIRCUMSTANCES UNDER WHICH GAO CONSIDERS SUBCONTRACTOR PROTESTS.
WORLDWIDE DIRECT MARKETING; MARKET COMPILATION AND RESEARCH BUREAU,
INC.:
WORLDWIDE DIRECT MARKETING (WORLDWIDE) AND MARKET COMPILATION AND
RESEARCH BUREAU, INC. (MCRB) PROTEST THE AWARD OF A SUBCONTRACT TO LCS
INDUSTRIES, INC. (LCS) UNDER REQUEST FOR PROPOSALS (RFP) NO. 0223,
ISSUED BY TED BATES ADVERTISING/NEW YORK (BATES). BATES IS THE PRIME
CONTRACTOR FOR THE NAVY'S NATIONWIDE RECRUITMENT ADVERTISING CAMPAIGN
UNDER CONTRACT NO. N00600-82-C-0001. WORLDWIDE AND MCRB PROTEST ON THE
BASIS THAT LCS WAS NOT THE "LOW, QUALIFIED BIDDER" AND THAT THE
SUBCONTRACT AWARD IS THEREFORE NOT IN THE BEST INTEREST OF THE
GOVERNMENT. WE DISMISS THE PROTESTS BECAUSE THEY DO NOT MEET ANY OF THE
LIMITED CIRCUMSTANCES UNDER WHICH OUR OFFICE WILL REVIEW SUBCONTRACTOR
PROTESTS.
THE BATES CONTRACT, A COST REIMBURSEMENT TYPE, IS FOR A NATIONAL
ADVERTISING CAMPAIGN TO RECRUIT AND RETAIN NAVY PERSONNEL. BATES IS
RESPONSIBLE FOR THE CREATIVE SERVICES NECESSARY TO CONDUCT THE CAMPAIGN,
PLACING THE ADVERTISING AS APPROPRIATE, FOR CONDUCTING THE CAMPAIGN
ITSELF, AND SUCH OTHER ANCILLARY SERVICES AS ARE NECESSARY. THE
SUBCONTRACT IN QUESTION IS FOR DATA PROCESSING AND RELATED SERVICES
NECESSARY TO ASSIST BATES.
ACCORDING TO THE NAVY, THE GOVERNMENT'S INVOLVEMENT WITH
SUBCONTRACTING WAS LIMITED TO APPROVING THE SUBCONTRACTING PLAN AND
APPROVING THE SUBCONTRACT AS REQUIRED BY DEFENSE ACQUISITION REGULATION
SEC. 7-203.8 (1976 ED.). THE NAVY STATES THAT IT DOES NOT PARTICIPATE
IN THE SUBCONTRACTOR SOLICITATION OR SELECTION PROCESS.
IN OPTIMUM SYSTEMS, INC., 54 COMP.GEN. 767 (1975), 75-1 CPD 166, WE
DELINEATED THE LIMITED CIRCUMSTANCES UNDER WHICH WE WOULD CONSIDER
SUBCONTRACTOR PROTESTS:
(1) WHERE THE PRIME CONTRACTOR IS ACTING AS A
PURCHASING AGENT OF THE GOVERNMENT;
(2) WHERE THE GOVERNMENT'S ACTIVE OR DIRECT
PARTICIPATION IN THE SELECTION OF THE
SUBCONTRACTOR HAS THE NET EFFECT OF
CAUSING THE REJECTION OR SELECTION OF A
POTENTIAL SUBCONTRACTOR, OR OF SIGNIFICANTLY
LIMITING SUBCONTRACTOR SOURCES;
(3) WHERE POSSIBLE FRAUD OR BAD FAITH IS SHOWN
IN THE GOVERNMENT'S APPROVAL OF THE SUBCONTRACT
AWARD OR PROPOSED AWARD;
(4) WHERE THE SUBCONTRACT IS "FOR" AN AGENCY
OF THE GOVERNMENT; OR
(5) WHERE THE QUESTIONS CONCERNING THE AWARD
OF SUBCONTRACTS ARE SUBMITTED BY FEDERAL
OFFICIALS ENTITLED TO ADVANCE DECISIONS
BY THIS OFFICE.
BATES IS CLEARLY NOT ACTING AS A PURCHASING AGENT FOR THE GOVERNMENT,
THERE HAS BEEN NO ALLEGATION OF FRAUD OR BAD FAITH IN THE SUBCONTRACT
APPROVAL PROCESS AND NO FEDERAL OFFICIAL HAS REQUESTED AN ADVANCE
DECISION FROM US. THUS, FACTORS (1), (3) AND (5) OF THE OPTIMUM SYSTEMS
TEST CAN BE DISREGARDED. MOREOVER, SINCE THE GOVERNMENT HAS TAKEN NO
PART IN THE SUBCONTRACTOR SELECTION PROCESS, CIRCUMSTANCE (2) IS ALSO
NOT APPLICABLE.
WE HAVE TRADITIONALLY CONSIDERED SUBCONTRACTS "FOR" THE GOVERNMENT TO
INCLUDE ONLY 1) THOSE AWARDED BY PRIME CONTRACTORS OPERATING AND
MANAGING DEPARTMENT OF ENERGY FACILITIES, 2) PURCHASES OF EQUIPMENT FOR
GOVERNMENT-OWNED, CONTRACTOR-OPERATED PLANTS, AND 3) PROCUREMENTS BY
CONSTRUCTION MANAGEMENT PRIME CONTRACTORS UNDER COST-TYPE CONTRACTS.
AMRAY INC., B-207261, JUNE 11, 1982, 82-1 CPD 561. THIS SUBCONTRACT IS
THEREFORE NOT ONE THAT IS "FOR" THE GOVERNMENT AS WE HAVE USED THAT
TERM.
ACCORDINGLY, AS NONE OF THE CIRCUMSTANCES FOUND IN OPTIMUM SYSTEMS
ARE PRESENT HERE, THE PROTESTS ARE DISMISSED.
B-210723, FEB 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST BY A TRADE ASSOCIATION THAT BIDDER DOES NOT HAVE A
SATISFACTORY RECORD OF INTEGRITY IS DISMISSED SINCE PROTEST CHALLENGES
AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY BY THE PROCURING AGENCY,
A MATTER NOT REVIEWED BY GAO EXCEPT IN CIRCUMSTANCES NOT APPLICABLE
HERE.
NORTHWEST FOREST WORKERS ASSOCIATION:
THE NORTHWEST FOREST WORKERS ASSOCIATION PROTESTS THE AWARD OF A
CONTRACT TO HIGHLAND REFORESTATION UNDER SOLICITATION NO. R6-3-83-25S,
ISSUED BY THE DEPARTMENT OF AGRICULTURE, FOREST SERVICE. BASING ITS
PROTEST ON AN OREGON BUREAU OF LABOR LICENSE COMPLAINT WHICH IT FILED
AGAINST HIGHLAND IN JANUARY 1983, THE ASSOCIATION ALLEGES THAT HIGHLAND
IS A NONRESPONSIBLE BIDDER BECAUSE, AMONG OTHER THINGS, IT ALLEGEDLY
EMPLOYS ILLEGAL ALIENS AND DOES NOT HAVE A SUFFICIENT RECORD OF
INTEGRITY.
OUR OFFICE NO LONGER REVIEWS A CONTRACTING AGENCY'S AFFIRMATIVE
DETERMINATION OF RESPONSIBILITY UNLESS THERE IS A SHOWING OF FRAUD ON
THE PART OF THE PROCURING AGENCY OR THE SOLICITATION CONTAINS DEFINITIVE
RESPONSIBILITY CRITERIA WHICH ALLEGEDLY HAVE NOT BEEN APPLIED. NEDLOG
CO., B-204557, SEPTEMBER 21, 1981, 81-2 CPD 235. THE PROTESTER DOES NOT
SUGGEST THAT EITHER EXCEPTION APPLIES HERE.
THE PROTEST IS DISMISSED.
B-210722, DEC 27, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. THREE EMPLOYEES OF THE NAVAL SHIP
REPAIR FACILITY, GUAM, WERE ASSIGNED TO TEMPORARY DUTY AT
BREMERTON, WASHINGTON. DURING THEIR JOURNEYS TO AND FROM THE
TEMPORARY DUTY SITE, THEY SPENT APPROXIMATELY 50 HOURS TRAVELING,
BUT WERE PAID FOR ONLY 8 HOURS OF THAT TIME. EMPLOYEES ARE NOT
ENTITLED TO OVERTIME FOR SUCH TRAVEL UNDER 5 U.S.C. SEC. 5542(B)(
2)(B), SINCE THEY DID NOT MEET ANY OF THE REQUIREMENTS OF THAT
STATUTE. HOWEVER, OFFICIAL WHO APPROVED TRAVEL DURING NONDUTY
HOURS SHOULD STATE HIS REASONS IN WRITING AND, UPON REQUEST,
FURNISH A COPY OF HIS REASONS IN ACCORDANCE WITH 5 C.F.R. SEC.
610.123.
2. THREE EMPLOYEES OF THE NAVAL SHIP
REPAIR FACILITY, GUAM, WERE ASSIGNED TO TEMPORARY DUTY AT
BREMERTON, WASHINGTON. DURING THEIR JOURNEYS TO AND FROM THE
TEMPORARY DUTY SITE, THEY SPENT APPROXIMATELY 50 HOURS TRAVELING,
BUT WERE PAID FOR ONLY 8 HOURS OF THAT TIME. IF THESE EMPLOYEES
ARE NON-EXEMPT UNDER THE FAIR LABOR STANDARDS ACT (FLSA), AND THEY
WORKED 33 HOURS OR MORE DURING THEIR FIRST WEEK AT BREMERTON, THEY
MAY BE ENTITLED TO OVERTIME PAY FOR A PORTION OF THEIR TRIP TO
BREMERTON BECAUSE IT CORRESPONDED TO THEIR NORMAL TOUR OF DUTY.
THERE IS NO ADDITIONAL ENTITLEMENT FOR THE RETURN TRIP, SINCE THEY
WERE ALREADY GIVEN CREDIT FOR 8 HOURS OF WORK DURING THAT JOURNEY.
GERALD A. MENDIOLA, ET AL. - OVERTIME PAY WHILE TRAVELING:
MR. JUAN P. DIAZ, PRESIDENT, LOCAL 1689, AMERICAN FEDERATION OF
GOVERNMENT EMPLOYEES (AFGE) HAS REQUESTED A DECISION CONCERNING CLAIMS
FOR OVERTIME PAY BY THREE EMPLOYEES OF THE U.S. NAVAL SHIP REPAIR
FACILITY, GUAM. PURSUANT TO 4 C.F.R. PART 22, THE COMMANDING OFFICER AND
ADMINISTRATION OFFICER WERE SERVED WITH A COPY OF LOCAL OR RESPONSE.
1689'S SUBMISSION, BUT THEY HAVE FILED NO WRITTEN COMMENTS WHO TRAVELED
FROM GUAM TO SEATTLE, WASHINGTON, ARE ENTITLED TO OVERTIME PAY FOR HOURS
SPENT TRAVELING OUTSIDE OF THEIR BASIC WORKWEEK. THE ANSWER IS THAT
THEY ARE NOT ENTITLED TO OVERTIME PAY FOR THE TRAVEL PERFORMED UNDER THE
CIRCUMSTANCES PRESENTED, BECAUSE THEY DID NOT MEET THE STATUTORY
REQUIREMENTS FOR OVERTIME PAY WHILE IN A TRAVEL STATUS AS SET FORTH AT 5
U.S.C. SEC. 5542(B)(2)(B). HOWEVER, UNDER THE FAIR LABOR STANDARDS ACT
(FLSA) THEY MAY BE ENTITLED TO 8 HOURS OVERTIME FOR THE TRAVEL FROM GUAM
TO SEATTLE IF THEY MEET THE OTHER STATUTORY REQUIREMENTS.
FACTS
MR. GERALD A. MENDIOLA, MR. JULIAN M. DAMIAN, AND MR. VINCENT M.
ROSARIO ARE ALL EMPLOYED BY THE U.S. NAVAL SHIP REPAIR FACILITY IN GUAM
AND WORKED A 40-HOUR BASIC WORKWEEK FROM 7 A.M. TO 3:40 P.M., MONDAY
THROUGH FRIDAY. THEY WERE ALL ASSIGNED TO TEMPORARY DUTY AT PUGET SOUND
NAVAL SHIPYARD, BREMERTON, WASHINGTON. THEY ALL TRAVELED TOGETHER TO
BREMERTON, LEAVING GUAM INTERNATIONAL AIRPORT ON SUNDAY, FEBRUARY 21,
1982, AT 8 P.M. (LOCAL TIME) AND ARRIVING AT THEIR TEMPORARY DUTY SITE
APPROXIMATELY 23 HOURS LATER AT 1 A.M. (LOCAL TIME) FEBRUARY 22, 1982.
NONE OF THE TRAVELTIME WAS SCHEDULED DURING THEIR ADMINISTRATIVE
WORKWEEK. THE THREE EMPLOYEES DID NOT RETURN TO GUAM AT THE SAME TIME
BUT THEY ALL SPENT 35 HOURS TRAVELING DURING THE TRIP HOME, OF WHICH 8
HOURS WERE DURING THEIR NORMALLY SCHEDULED BASIC WORKWEEK. THEREFORE,
THEY ARE CLAIMING A TOTAL OF 50 HOURS OVERTIME PAY; 23 HOURS FOR TRAVEL
FROM GUAM TO BREMERTON AND 27 HOURS (35 HOURS OF TRAVELTIME LESS 8 HOURS
DURING THEIR BASIC WORKWEEK) FOR TRAVEL FROM BREMERTON BACK TO GUAM.
OVERTIME UNDER TITLE 5, U.S. CODE
PURSUANT TO 5 U.S.C. SEC. 6101(B)(2), TO THE MAXIMUM EXTENT
PRACTICABLE, FEDERAL EMPLOYEES' TRAVEL SHOULD BE SCHEDULED DURING THE
EMPLOYEES' REGULARLY SCHEDULED WORKWEEK. A SIMILAR PROVISION IS
CONTAINED IN ARTICLE XXVI, SECTION 4 OF THE NEGOTIATED AGREEMENT BETWEEN
THE UNITED STATES NAVAL SHIP REPAIR FACILITY, GUAM, AND THE AFGE LOCAL
1689. IN CASES SUCH AS THIS WHERE TRAVEL TAKES OVER 20 HOURS, IT IS
IMPOSSIBLE TO SCHEDULE ALL THE TRAVEL DURING THE WORKWEEK. HOWEVER,
CONGRESS, INSTEAD OF PROVIDING A REMEDY FOR THIS SITUATION HAS BY
STATUTE ONLY ALLOWED PAYMENT OF OVERTIME FOR TIME SPENT TRAVELING IF ONE
OF THE EXCEPTIONS STATED BELOW IS MET. THE PERTINENT STATUTE, 5 U.
S.C. SEC. 5542(B) PROVIDES:
"(B) FOR PURPOSE OF THIS SUBCHAPTER -
* * * * *
"(2) TIME SPENT IN A TRAVEL STATUS AWAY
FROM THE OFFICIAL-DUTY STATION OF AN EMPLOYEE
IS NOT HOURS OF EMPLOYMENT UNLESS -
"(A) THE TIME SPENT IS WITHIN THE
DAYS AND HOURS OF THE REGULARLY SCHEDULED
ADMINISTRATIVE WORKWEEK OF THE EMPLOYEE,
INCLUDING REGULARLY SCHEDULED OVERTIME
HOURS; OR
"(B) THE TRAVEL (I) INVOLVES THE
PERFORMANCE OF WORK WHILE TRAVELING,
(II) IS INCIDENT TO TRAVEL THAT INVOLVES
THE PERFORMANCE OF WORK WHILE TRAVELING,
(III) IS CARRIED OUT UNDER ARDUOUS
CONDITIONS, OR (IV) RESULTS FROM AN
EVENT WHICH COULD NOT BE SCHEDULED OR
CONTROLLED ADMINISTRATIVELY."
THEREFORE, IN ORDER FOR THE THREE EMPLOYEES TO BE PAID OVERTIME UNDER
TITLE 5 OF THE U.S. CODE FOR THEIR TRAVELTIME, THEY MUST MEET ONE OF THE
FOUR EXCEPTIONS. IN ITS SUBMISSION, THE UNION HAS NOT ALLEGED THAT THE
TRAVEL SATISFIED ANY OF THESE EXCEPTIONS. AFTER ANALYZING OUR CASES IN
THIS AREA, WE CONCLUDE THAT NONE OF THE EXCEPTIONS HAVE BEEN MET. JAMES
M. RAY, B-202694, JANUARY 4, 1982; WILLIAM L. LAMB, 61 COMP.GEN. 626
(1982); AND NATHANIEL R. RAGSDALE, 57 COMP.GEN. 43 (1977). THEREFORE,
WE MUST CONCLUDE THAT THE EMPLOYEES INVOLVED ARE NOT ENTITLED TO
OVERTIME PAY UNDER 5 U.S.C. SEC. 5542 FOR THEIR TRAVEL DURING HOURS
OUTSIDE OF THEIR BASIC WORKWEEK.
WE ALSO NOTE THAT 5 C.F.R. SEC. 610.123 (1983) PROVIDES THAT WHEN AN
EMPLOYEE IS TRAVELING DURING NONDUTY HOURS AND IS NOT BEING PAID
OVERTIME, THE OFFICIAL CONCERNED SHALL RECORD HIS REASONS FOR ORDERING
TRAVEL AT THOSE HOURS AND SHALL UPON REQUEST, FURNISH A COPY OF HIS
STATEMENT TO THE EMPLOYEE CONCERNED. IN ITS SUBMISSION THE UNION STATES
THAT FOR REASONS UNKNOWN, THEY COULD NOT OBTAIN ANY OFFICIAL
DOCUMENTATION CITING THE JUSTIFICATION FOR THE TRAVEL DURING NONDUTY
HOURS. THE EMPLOYEES INVOLVED ARE ENTITLED TO RECEIVE SUCH
JUSTIFICATION AS REQUIRED BY THE REGULATION. 51 COMP.GEN. 727 (1972).
ACCORDINGLY, THE APPROPRIATE OFFICIAL AT THE NAVAL SHIP REPAIR FACILITY
SHOULD PROVIDE SUCH JUSTIFICATION TO THE EMPLOYEES INVOLVED UPON
REQUEST.
OVERTIME UNDER FLSA
ALTHOUGH THE UNION IN ITS SUBMISSION DID NOT SPECIFICALLY RAISE THE
ISSUE OF OVERTIME UNDER THE FAIR LABOR STANDARDS ACT, 29 U.S.C. SECS.
201 ET SEQ., THE EMPLOYEES INVOLVED MAY BE ENTITLED TO OVERTIME PAY
UNDER THAT ACT.
THE RECORD DOES NOT STATE WHETHER THE EMPLOYEES WERE COVERED
(NON-EXEMPT) UNDER THE FLSA. HOWEVER, THE FACT THAT THEY WORK ON GUAM
IS NOT CONTROLLING, SINCE 29 U.S.C. SEC. 213(F) STATES THAT EMPLOYEES
WORKING ON GUAM MAY BE COVERED BY THE FLSA. THEREFORE, IF THE EMPLOYEES
ARE NON-EXEMPT, THE FOLLOWING ANALYSIS APPLIES.
THE THRESHOLD ISSUE IS WHETHER THE TRAVEL QUALIFIES AS "HOURS OF
WORK" UNDER FLSA. IN THAT REGARD, FEDERAL PERSONNEL MANUAL (FPM) LETTER
NO. 551-105 APRIL 30, 1976, PARAGRAPH 3 STATES THAT:
"*** IN GENERAL, AUTHORIZED TRAVEL TIME
OUTSIDE REGULAR WORKING HOURS IS 'HOURS OF
WORK' UNDER FLSA IF AN EMPLOYEE (1) PERFORMS
WORK WHILE TRAVELING (INCLUDING TRAVEL AS
A DRIVER OF A VEHICLE), (2) TRAVELS AS A
PASSENGER TO A TEMPORARY DUTY STATION AND
RETURNS DURING THE SAME DAY, OR (3) TRAVELS
AS A PASSENGER ON NONWORK DAYS DURING HOURS
WHICH CORRESPOND TO HIS/HER REGULAR WORKING
HOURS. ***."
BASED ON THIS INSTRUCTION, THE EMPLOYEES COULD BE ELIGIBLE FOR
OVERTIME UNDER THE FLSA IF THEY TRAVELED ON NONWORK DAYS DURING HOURS
WHICH CORRESPOND TO THEIR REGULAR WORKING HOURS. WE NOTE THAT THEIR
REGULAR WORKING HOURS ARE FROM 7 A.M. TO 3:40 P.M., MONDAY THROUGH
FRIDAY. THEREFORE, IF THE EMPLOYEES TRAVELED DURING THOSE HOURS DURING
ANY OF THE DAYS OF THE WEEK INCLUDING SATURDAY OR SUNDAY, THOSE TRAVEL
HOURS WOULD BE CONSIDERED HOURS OF WORK UNDER THE FLSA. ALSO, IN
COMPUTING OVERTIME FOR TRAVEL WHICH INVOLVES MORE THAN TWO TIME ZONES,
THE TIME ZONE FROM THE POINT OF FIRST DEPARTURE IS USED TO DETERMINE
WHETHER THE EMPLOYEE PERFORMED THE TRAVEL DURING REGULAR WORKING HOURS.
SEE ATTACHMENT TO FPM LETTER 551-10, APRIL 30, 1976, PARAGRAPH F(3).
AS STATED ABOVE, ALL THREE EMPLOYEES LEFT GUAM AT 8 P.M. ON SUNDAY,
FEBRUARY 21, 1982. THEY TRAVELED APPROXIMATELY 23 HOURS AND ARRIVED ON
MONDAY, FEBRUARY 22, 1982, 1 A.M. (LOCAL TIME) AT THEIR TEMPORARY DUTY
SITE. HOWEVER, UNDER THE FLSA, IT IS THE TIME ZONE OF THE FIRST
DEPARTURE (GUAM) WHICH IS RELEVANT IN DETERMINING WHETHER THE EMPLOYEES
TRAVELED DURING WORKING HOURS. THEREFORE, FOR PURPOSES OF THE FLSA,
THEY ARRIVED AT 7 P.M. MONDAY, FEBRUARY 22, GUAM TIME AT THEIR TEMPORARY
DUTY SITE. THEREFORE, SINCE THEY TRAVELED DURING THEIR WORKING HOURS TO
GUAM, THOSE 8 HOURS COUNT AS "HOURS OF WORK" UNDER THE FLSA.
UNDER THE FLSA, EMPLOYEES MUST WORK 40 HOURS A WEEK BEFORE THEY ARE
ENTITLED TO OVERTIME PAY. EXCUSED ABSENCES WITH PAY (HOLIDAYS, SICK,
ANNUAL AND OTHER PAID LEAVE) ARE NOT CONSIDERED HOURS OF WORK FOR THE
PURPOSES OF DETERMINING WHETHER 40 HOURS HAVE BEEN WORKED. SEE
ATTACHMENT 4 TO FPM LETTER 551-1, MAY 15, 1974. THEREFORE, IN THE
PRESENT CASE, ALL THREE EMPLOYEES WOULD HAVE TO HAVE WORKED AT LEAST 33
HOURS DURING THE WEEK OF FEBRUARY 21 TO 28 IN ORDER TO GET OVERTIME PAY
FOR THE 8 HOURS OF WORK CREDITED WHILE TRAVELING. IF THESE EMPLOYEES
WERE EXCUSED FROM WORK OR WERE GRANTED ANY KIND OF LEAVE DURING THAT
WEEK, THOSE HOURS WOULD NOT COUNT TOWARDS THE HOURS OF WORK REQUIREMENT.
THE RECORD SHOWS THAT THE EMPLOYEES HAVE ALREADY BEEN CREDITED WITH 8
HOURS OF WORK WHEN THEY TRAVELED BACK TO GUAM DURING REGULAR WORKING
HOURS. THEREFORE THERE IS NO EXTRA ENTITLEMENT UNDER THE FLSA FOR THE
RETURN TRAVEL.
IN CONCLUSION, THE EMPLOYEES ARE NOT ENTITLED TO ANY OVERTIME PAY
UNDER THE PROVISIONS OF TITLE 5. UNDER THE FLSA, IF THESE EMPLOYEES ARE
NON-EXEMPT, AND IF THEY WORKED A 40-HOUR WEEK FROM FEBRUARY 21 TO 28,
THEY ARE ENTITLED TO OVERTIME PAY FOR THE 8 HOURS TRAVELED FROM GUAM TO
THE TEMPORARY DUTY SITE. THERE IS NO ENTITLEMENT FOR OVERTIME PAY FOR
THEIR RETURN TRAVEL UNDER THE FLSA.
B-210719, DEC 23, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
ARMY HOSPITALS SUBSCRIBE TO INTERLABORATORY COMPARISON
SURVEY PROGRAM TO SATISFY QUALITY CONTROL AND ACCREDITATION
REQUIREMENTS. PROGRAM PROVIDES SUBSCRIBERS WITH
PRINTED EVALUATIONS BASED UPON PARTICIPANT INPUT. FACT
THAT PROGRAM SUPPLIES PARTICIPANTS WITH SURVEY KITS SO
THAT THEY CAN PERFORM TESTS TO OBTAIN "INPUT DATA" DOES
NOT "TAINT" EVALUATION REPORT SO AS TO PRECLUDE PAYMENT
UNDER 31 U.S.C. SEC. 3324(D)(2), WHICH PERMITS ADVANCE
PAYMENTS FOR "PUBLICATIONS," SINCE KITS ARE MEANS FOR
COLLECTING DATA EVALUATED IN PUBLICATIONS AND ANALYSIS
OF DATA IS THE CONTENT OF PUBLICATION.
ARMY HEALTH SERVICE COMMAND-- ADVANCE PAYMENT FOR INTERLABORATORY
COMPARISON SURVEY PROGRAM:
THE CHIEF OF THE FINANCE AND ACCOUNTING DIVISION, FORT SAM HOUSTON,
TEXAS, REQUESTS OUR DECISION TO RESOLVE AN INTERNAL STAFF DISPUTE
CONCERNING WHETHER THE ARMY CAN PROPERLY PAY IN ADVANCE FOR
SUBSCRIPTIONS TO THE COLLEGE OF AMERICAN PATHOLOGISTS' (CAP)
INTERLABORATORY COMPARISON SURVEY AND PROGRAM. WE CONCLUDE FOR THE
REASONS GIVEN BELOW THAT IT CAN.
CAP SELLS TO ARMY HOSPITALS, ON A SUBSCRIPTION BASIS, EVALUATION
REPORTS BASED UPON DATA SUPPLIED BY EACH PARTICIPATING LABORATORY. THE
HOSPITALS PROCURE THE CAP SUBSCRIPTIONS IN ORDER TO MEET REQUIREMENTS
ESTABLISHED BY THE JOINT COMMITTEE ON ACCREDITATION OF HOSPITALS (JCAH)
AND TO SATISFY QUALITY CONTROL STANDARDS. HOWEVER, SOME ARMY OFFICIALS
QUESTION THE PROPRIETY OF PAYING IN ADVANCE FOR THE SUBSCRIPTIONS
BECAUSE THE PROGRAM PROVIDES SUBSCRIBERS WITH LABORATORY KITS IN
ADDITION TO THE PRINTED MATERIAL. PARTICIPANTS PERFORM VARIOUS CHEMICAL
TESTS USING THE KITS IN ORDER TO OBTAIN DATA REQUIRED FOR THE EVALUATION
REPORTS. THUS, THE QUESTION IS ASKED, IN EFFECT, WHETHER THE INCLUSION
OF THE LABORATORY KITS "TAINTS" THE EVALUATION REPORTS SO AS TO PRECLUDE
ADVANCE PAYMENT UNDER 31 U.S.C. SEC 3324(D)(2) (FORMERLY 31 U.S.C. SEC.
350).
SECTION 3324(D) PROVIDES:
"THE HEAD OF AN AGENCY MAY PAY IN ADVANCE FROM
APPROPRIATIONS AVAILABLE FOR THE PURPOSE *** (2) CHARGES
FOR A PUBLICATION PRINTED OR RECORDED IN ANY
WAY FOR THE AUDITORY OR VISUAL USE OF THE AGENCY."
THIS OFFICE HAS HELD THAT ITEMS WHICH ARE READ, SUCH AS BOOKS,
PAMPHLETS, NEWSPAPERS, PERIODICALS, MICROCARDS AND OTHER PRINTS
CONSTITUTE PUBLICATIONS. SEE 41 COMP.GEN. 211 (1961); 57 COMP.GEN.
583 (1978). THUS, A SUBSCRIPTION TO PRINTED EVALUATION REPORTS
THEMSELVES WOULD FALL WITHIN THE PURVIEW OF 31 U.S.C. SEC. 3324(D)(2),
SUPRA.
WHILE WE DO NOT HAVE AN EXAMPLE OF THE SURVEY KITS BEFORE US, THE
DEPUTY CHIEF OF STAFF, LOGISTICS, U.S. ARMY HEALTH SERVICES COMMAND,
DESCRIBES HOW THE SURVEY KITS FIT INTO THE PUBLICATION OF THE SUMMARY
EVALUATIONS AS FOLLOWS:
"A. SURVEY KITS, CONSISTING OF 'UNKNOWN' ELEMENTS
AND REAGENTS REQUIRED TO TEST FOR THE 'UNKNOWNS'
ARE PERIODICALLY MAILED TO PARTICIPATING LABS,
MILITARY AND CIVILIAN.
"B. INDIVIDUAL LABS PERFORM THE REQUIRED TEST
AND MAIL THE RESULTS TO THE CONTRACTOR.
"C. CONTRACTOR SUMMARIZES AND EVALUATES THE
RESULTS FROM ALL PARTICIPATING LABORATORIES.
"D. CONTRACTOR PERIODICALLY MAILS SUMMARY
EVALUATIONS *** TO PARTICIPANTS. THE EVALUATIONS INCLUDE
ALL RESULTS FROM ALL PARTICIPANTS, INDICATING HOW
'WELL' INDIVIDUAL LABS PERFORMED IN RELATIONSHIP TO
ALL OTHER LABS. IN ADDITION, COMPARISON OF ALTERNATE
METHODS USED BY DIFFERENT LABS IS DISCUSSED."
THE DEPUTY CHIEF OF STAFF, LOGISTICS, OF THE COMMAND CITES OUR
DECISION IN 41 COMP.GEN. 211 (1961) IN SUPPORT OF HIS POSITION THAT THE
SUBSCRIPTION TO THIS SERVICE MAY BE PAID IN ADVANCE. IN THAT CASE, WE
CONCLUDED THAT THE DEPARTMENT OF COMMERCE COULD MAKE AN ADVANCE PAYMENT
UNDER 31 U.S.C. SEC. 530 (THE PREDECESSOR TO 31 U.S.C. SEC. 3324(D)(2))
FOR A COMPLETE SET OF MICROCARDS OF IGY RADIATION DATA PUBLISHED BY THE
WORLD METEOROLOGICAL ORGANIZATION AND BASED ON "DATA FURNISHED BY THE
COUNTRIES WHO ARE MEMBERS ***." ACCORDING TO THE DEPUTY CHIEF -
"THE FACT THAT THE EVALUATED RESULTS ARE BASED
UPON INPUT FURNISHED BY THE PARTICIPANTS DOES NOT PRECLUDE
CLASSIFICATION OF THE PROGRAM AS A SUBSCRIPTION
TO A PUBLICATION."
THE STAFF JUDGE ADVOCATE FOR THE HEALTH SERVICES COMMAND VIEWS THE
SUBSCRIPTION DIFFERENTLY. HE BELIEVES THAT THE ARMY IS BUYING TWO
THINGS: A TESTING SERVICE AND A PUBLICATION. HE POINTS OUT THAT THE
GOVERNMENT IS RECEIVING SURVEY KITS AND ANALYSIS IN ADDITION TO THE
SUMMARY OF THE INDIVIDUAL COMPUTER PRINTED EVALUATION REPORTS. IN
SUPPORT OF HIS POSITION, THE STAFF JUDGE ADVOCATE CITES OUR DECISION,
B-188166, JUNE 3, 1977, WHERE WE CONCLUDED THAT THE AUTHORITY TO MAKE
ADVANCE PAYMENT FOR PUBLICATIONS DID NOT EXTEND TO RENTAL OF EQUIPMENT
USED IN CONJUNCTION WITH A MICROFILMED LIBRARY SYSTEM. WHILE IT IS NOT
CLEAR FROM THE DECISION ITSELF, THE EQUIPMENT IN B-188166, ID.,
CONSISTED OF READER/PRINTERS THAT WOULD GIVE THE PROCURING AGENCY ACCESS
TO THE MICROFILM.
41 COMP.GEN. 211, SUPRA, CITED BY THE LOGISTICS COMMAND DEPUTY CHIEF
OF STAFF IN SUPPORT OF ALLOWING ADVANCE PAYMENTS IN THIS CASE, DID NOT
CONSIDER THE SOURCE OF DATA IN DECIDING THAT THE MICROCARDS IN ISSUE
WERE A "PUBLICATION" WITHIN THE CONTEMPLATION OF THE STATUTE. HOWEVER,
THE DATA USED IN PREPARING THE MICROCARDS IN THAT CASE WAS, IN FACT,
SECURED FROM THE PUBLICATION'S USERS, JUST AS THE INFORMATION ANALYZED
AND PUBLISHED BY THE CONTRACTOR IN THIS CASE IS OBTAINED FROM USERS OF
THE PUBLICATION BY MEANS OF THE SURVEY KITS.
WHILE WE ASSUME THAT THE COST OF PREPARING AND DISTRIBUTING THE
SURVEY KITS AND OF ANALYZING THE DATA OBTAINED IS INCLUDED IN THE
SUBSCRIPTION PRICE FOR THE CAP REPORTS, THE KITS WOULD APPEAR TO BE
NOTHING MORE THAN DATA-GATHERING INSTRUMENTS AND THUS ARE A PART OF THE
PUBLICATION PROCESS. SIMILARLY, ANALYSIS OF DATA OBTAINED BY USE OF THE
SURVEY KITS IS AN OBVIOUS PREREQUISITE TO PUBLICATION OF THE RESULTS OF
THE ANALYSIS. THE READER/PRINTERS WHICH WERE THE SUBJECT OF B-188166,
SUPRA, ON THE OTHER HAND, WERE NOT PART OF THE PUBLICATION PROCESS. OUR
DECISION IN THAT CASE STATED THAT THE LEGISLATIVE HISTORY OF PUBLIC LAW
93-534, WHICH EXPANDED THE DEFINITION OF "PUBLICATION" TO INCLUDE "OTHER
PUBLICATIONS" SUCH AS MICROFILM AND TAPE-RECORDED MATERIAL, "DOES NOT
INDICATE ANY INTENT TO AUTHORIZE ADVANCE PAYMENTS FOR ITEMS OF EQUIPMENT
NECESSARY FOR USE IN CONJUNCTION WITH THE 'OTHER PUBLICATIONS.'"
IN OUR VIEW, THE TWO SITUATIONS ARE DISTINGUISHABLE ON THE GROUND
THAT THE DATA GATHERED AND ANALYZED BY THE CAP IS NOT USED "IN
CONJUNCTION WITH" THE PUBLICATION OF THE CAP REPORTS BUT INSTEAD IS AN
INTEGRAL PART OF THE PUBLICATION PROCESS. FURTHER, THE CAP SOLICITATION
MATERIAL FURNISHED WITH THE ARMY'S REQUEST FOR A DECISION REFERS TO THE
VARIOUS SURVEY REPORTS OFFERED TO HOSPITALS AND LABORATORIES AS
"SUBSCRIPTIONS" AND REQUIRES THAT PAYMENT BE MADE IN ADVANCE.
ACCORDINGLY, WE CONCLUDE THAT SUBSCRIPTIONS TO THE CAP REPORTS MAY BE
PAID IN ADVANCE PURSUANT TO 31 U.S.C. SEC. 3324(D)(2).
B-210717.2, FEB 24, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
THE DEFENSE LOGISTICS AGENCY MAY NOT
SET UP PROCEDURES UNDER WHICH PROMOTIONAL
BENEFITS THAT WERE RECEIVED BY
AN EMPLOYEE WHILE ON OFFICIAL TRAVEL ON
BEHALF OF THE GOVERNMENT MAY BE RETURNED
TO THE EMPLOYEE. PERTINENT REGULATIONS
PROVIDE FOR THE DISPOSITION OF THESE
PROMOTIONAL MATERIALS AND DO NOT PROVIDE
FOR RETURNING THESE BENEFITS TO THE
EMPLOYEE. FURTHERMORE THE EMPLOYEE WHO
RECEIVED THESE BENEFITS DID SO ON BEHALF
OF THE GOVERNMENT AND HAS NO PROPERTY
RIGHT TO THESE BENEFITS.
DEFENSE LOGISTICS AGENCY - AIRLINE PROMOTIONAL PROGRAMS:
THE DIRECTOR OF THE DEFENSE LOGISTICS AGENCY (DLA) HAS REQUESTED OUR
DECISION CONCERNING AIRLINE PROMOTIONAL BENEFITS RECEIVED AS A RESULT OF
TRAVEL BY AN EMPLOYEE ON OFFICIAL DUTY. THE ISSUE IN THIS CASE IS
WHETHER DLA MAY ESTABLISH PROCEDURES UNDER WHICH BENEFITS WHICH WERE
RECEIVED BY THE EMPLOYEE WHILE ON OFFICIAL TRAVEL ON BEHALF OF THE
GOVERNMENT MAY BE RETURNED TO THE EMPLOYEE FOR HIS PERSONAL USE AFTER
THE DLA DETERMINES THAT THE GOVERNMENT IS UNABLE TO USE THOSE BENEFITS.
WE HOLD THAT THE DLA MAY NOT SET UP SUCH PROCEDURES SINCE THE
PROMOTIONAL MATERIAL IS PROPERTY OF THE GOVERNMENT AND SHOULD BE HANDLED
IN ACCORDANCE WITH PERTINENT REGULATIONS OF THE GENERAL SERVICES
ADMINISTRATION. SEE B-210717, DATED TODAY.
THE DLA HAS ESTABLISHED A POLICY WHICH REQUIRES AN EMPLOYEE TO
SURRENDER BENEFITS RECEIVED AS A RESULT OF OFFICIAL TRAVEL TO THE
TRANSPORTATION OFFICES. THE AGENCY STATES THAT THIS POLICY IS BASED ON
OUR DECISION JOHN B. CURRIER, 59 COMP.GEN. 95 (1979), IN WHICH WE STATED
THAT THE POLICY WAS NECESSARY TO AVOID A CONFLICT OF INTEREST AND TO
PREVENT REIMBURSEMENT TO THE EMPLOYEE FROM PRIVATE SERVICE. THE AGENCY
ARGUES THAT THEY HAVE ADOPTED SUFFICIENT MANAGEMENT CONTROLS TO MAKE THE
POSSIBILITY OF SUCH ABUSES REMOTE. THEREFORE, THEY PROPOSE TO REVISE
THEIR SYSTEM SO THAT AN EMPLOYEE WHO TURNS THESE BENEFITS INTO THE
GOVERNMENT, MAY HAVE THE BENEFITS RETURNED TO THE EMPLOYEE BY THE
TRANSPORTATION OFFICER FOR PERSONAL USE IF THE AGENCY OFFICIAL
DETERMINES THAT THEY HAVE NO USE FOR THE BENEFITS.
BASED ON APPLICABLE REGULATIONS AND OUR DECISIONS, WE ARE UNABLE TO
GRANT DLA'S REQUEST TO IMPLEMENT THE POLICY DESCRIBED ABOVE. THE
GENERAL SERVICES ADMINISTRATION (GSA) HAS RECENTLY PROMULGATED
REGULATIONS CONCERNING PROMOTIONAL MATERIALS, TRADING STAMPS, OR BONUS
GOODS. 41 C.F.R. PART 101-25, AS AMENDED, 48 FED.REG. 48,231, OCTOBER
18, 1983. FIRST, THESE REGULATIONS PROVIDE THAT PROMOTIONAL COUPONS THAT
PROVIDE FOR FUTURE FREE OR REDUCED COSTS OF SERVICES SHOULD BE
INTEGRATED INTO THE AGENCY TRAVEL PLANS TO MAXIMIZE THE BENEFIT TO THE
GOVERNMENT. 41 C.F.R. SEC. 101-25.103-2(B). THESE REGULATIONS ALSO
PROVIDE THAT PROMOTIONAL MATERIALS THAT CANNOT BE USED BY THE RECEIVING
AGENCY SHALL BE DISPOSED OF IN ACCORDANCE WITH 41 C.F.R. SEC.
101-25.103-4 WHICH ESTABLISHES PROCEDURES FOR TRANSFER OF THE
PROMOTIONAL MATERIALS. THESE REGULATIONS DO NOT PROVIDE FOR A SYSTEM IN
WHICH THE AGENCY MAY RETURN THESE MATERIALS TO THE EMPLOYEE WHO RECEIVED
THEM ON BEHALF OF THE GOVERNMENT.
IN A COMPANION CASE, DECIDED TODAY, B-210717, WE ANSWERED QUESTIONS
SIMILAR TO THOSE RAISED BY DLA. IN THAT DECISION, WE DISCUSSED THAT THE
EMPLOYEE REALLY HAS NO PROPERTY RIGHTS IN MATERIALS RECEIVED AS A RESULT
OF GOVERNMENT-PAID TRAVEL. THESE BONUSES HAVE NEVER LEGALLY BELONGED TO
THE EMPLOYEE, AND, THEREFORE, IF AN AGENCY GAVE THE BONUSES TO AN
EMPLOYEE, THEY WOULD BE, IN ESSENCE, ILLEGALLY SUPPLEMENTING THAT
EMPLOYEE'S SALARY.
THEREFORE, BASED ON OUR DECISIONS AND GSA REGULATIONS, DLA MAY NOT
SET UP PROCEDURES FOR THE RETURN OF BONUS GOODS EARNED WHILE ON OFFICIAL
TRAVEL ON BEHALF OF THE GOVERNMENT TO THE EMPLOYEE WHO PERFORMED SUCH
TRAVEL.
B-210714, MAR 26, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE RECORD INDICATES THAT EVALUATION OF
PROTESTER'S PROPOSAL WAS IN ACCORDANCE WITH ESTABLISHED CRITERIA
SET FORTH IN SOLICITATION AND THE EVALUATION WAS REASONABLE,
PROTEST BASED ON OFFEROR'S DISAGREEMENT WITH THE EVALUATION IS
DENIED.
2. WHERE AGENCY QUESTIONS OFFEROR'S OVERALL
APPROACH TO A PARTICULAR TASK DURING THE COURSE OF ORAL
DISCUSSIONS IN PROCUREMENT INVOLVING SPECIALIZED TECHNICAL
SERVICES, PROTEST THAT DISCUSSIONS WERE TOO GENERALIZED IS DENIED
BECAUSE, AS THE SOLICITATION ADVISED, PROPOSALS WERE EVALUATED
PRIMARILY UPON THE BASIS OF THE OFFEROR'S DEMONSTRATED KNOWLEDGE
AND UNDERSTANDING OF THE SERVICES TO BE PROVIDED. CONSEQUENTLY,
BECAUSE THE OFFEROR'S UNDERSTANDING OF THE WORK WAS TO BE
EVALUATED, NOT THE PROCURING AGENCY'S, THE AGENCY WAS NOT REQUIRED
TO PROVIDE DETAILED GUIDANCE ON HOW PROPOSALS COULD BE UPGRADED.
3. PROTEST ALLEGING THAT THE PROCURING AGENCY
FAILED TO INDICATE THE SERIOUSNESS OF THE DEFICIENCIES NOTED IN
THE PROTESTER'S PROPOSAL DURING DISCUSSIONS IS DENIED WHERE THE
RECORD SHOWS THAT THE AGENCY ASKED THE OFFEROR TO CLARIFY ITS
UNDERSTANDING OF THE LEVEL OF EFFORT REQUIRED AND ITS PROPOSED
APPROACH TO FOUR OF THE SEVEN AREAS EVALUATED. SUCH FUNDAMENTAL
QUESTIONING OF THE PROPOSAL MEANINGFULLY CONVEYED THE SERIOUSNESS
OF THE DEFICIENCIES INDICATED.
4. PROTEST THAT AWARD TO SELECTED CONTRACTOR
WILL CREATE AN ORGANIZATIONAL CONFLICT OF INTEREST IS DENIED WHERE
ALLEGED CONFLICTS PERTAIN TO OVERLAPPING ROLES IN SUPPORT OF
DIFFERENT ORGANIZATIONAL ELEMENTS WITHIN THE SAME AGENCY, AND
AGENCY STATES THAT IT WILL MONITOR THE PLACING OF TASK ORDERS TO
AVOID SUCH CONFLICT AS EXISTS.
5. BARE ALLEGATION THAT THE PROCURING AGENCY
FABRICATED PROCUREMENT RECORDS AFTER THE FACT TO JUSTIFY ITS
POSITION IS DENIED AS PURE SPECULATION.
PRI, INC.:
PRI, INC. PROTESTS AWARD UNDER REQUEST FOR PROPOSALS NO.
M00027-82-R-0022 SEEKING SUPPORT SERVICES FOR THE MATERIEL DIVISION,
HEADQUARTERS, U.S. MARINE CORPS. PRI CONTENDS THAT THE MARINE CORPS
ERRED IN RATING ITS PROPOSAL AS TECHNICALLY UNACCEPTABLE; THAT THE
MARINE CORPS FAILED TO CONDUCT MEANINGFUL DISCUSSIONS; AND THAT THE
PROCUREMENT WAS DEFICIENT IN NUMEROUS OTHER RESPECTS. WE DENY THE
PROTEST.
THE SOLICITATION SOUGHT CONTRACTORS TO PROVIDE ENGINEERING AND OTHER
SPECIFIED SERVICES TO SUPPORT NAMED ORGANIZATIONS WITHIN THE MATERIEL
DIVISION. THESE ORGANIZATIONAL ELEMENTS WERE BROKEN DOWN INTO THREE
GROUPS AND WERE IDENTIFIED AS SEPARATE ITEMS IN THE SCOPE OF WORK.
THESE THREE ITEMS WERE, FOR ALL PRACTICAL PURPOSES, HANDLED AS SEPARATE
PROCUREMENTS, WITH SEPARATE PROPOSALS EVALUATED BY DIFFERENT BOARDS AND
INDEPENDENTLY SELECTED. THE SOLICITATION CONTEMPLATED SEPARATE
INDEFINITE QUANTITY CONTRACTS FOR EACH ITEM, SUBJECT TO DELIVERY ORDERS
TO BE ISSUED FOR INDIVIDUAL TASKS ON EITHER A FIRM FIXED-PRICE OR TIME
AND MATERIALS BASIS. EACH CONTRACT LIMITED THE GOVERNMENT'S OBLIGATION
TO $200,000 PER YEAR AND CONTEMPLATED A 1-YEAR TERM PLUS 2 OPTION YEARS.
SIX PROPOSALS WERE RECEIVED IN RESPONSE TO THE ITEM HERE IN QUESTION,
WHICH SOUGHT THE SERVICES OF ENGINEERS, GROUND AMMUNITION SUPPORT
ANALYSTS, LOGISTICS ANALYSTS, DRAFTSMEN, AND TECHNICIANS TO SUPPORT THE
WEAPONS BRANCH AND THE AMMUNITION AND MISSILE BRANCH OF THE MATERIEL
DIVISION.
THE SOURCE SELECTION EVALUATION BOARD CONCLUDED THAT ALL SIX
TECHNICAL PROPOSALS WERE SUSCEPTIBLE TO UPGRADING TO ACCEPTABILITY AND
THEN EVALUATED THE OFFERORS' PRICE AND PAST PERFORMANCE. BASED UPON THE
PRE-ESTABLISHED WEIGHTING RATIO OF 60 FOR TECHNICAL, 35 FOR PRICE AND 5
FOR PAST PERFORMANCE, TOTAL SCORES WERE CALCULATED AS FOLLOWS:
FIRM TECHNICAL SCORE PRICES TOTAL SCORE
ADTECH 55 $1,734,657.60 88.7
MCAUTO 58 $2,587,332.80 81.2
PRI 38 $1,338,729.60 78.1
ASSET 40 $2,210,748.80 67.75
KAPPA 40 $2,872,604.80 62.35
COLUMBIA 32 $2,173,912.00 58.45
DISCUSSIONS WERE HELD WITH ALL OFFERORS ON NOVEMBER 10, 1982 BY
TELEPHONE, WHICH WERE CONFIRMED BY LETTER OF THAT SAME DATE, AND BEST
AND FINAL OFFERS WERE INVITED. PROPOSALS WERE THEN REEVALUATED AS TO
PRICE AND PAST EXPERIENCE AND TOTAL SCORES RE-COMPUTED, AS FOLLOWS:
FIRM TECHNICAL SCORE PRICES TOTAL SCORE
ADTECH 88 $1,506,419.20 93.7
MCAUTO 98 $2,587,332.80 83.
ASSET 45.2 $1,508,873.60 *
KAPPA 44 $2,217,862.40 *
PRI 38 $1,268,654.40 *
COLUMBIA 32 $1,761,281.60 *
* NO SCORE DUE TO TECHNICALLY UNACCEPTABLE PROPOSAL. BASED ON ITS
REVIEW OF THE FINAL SUBMISSIONS, THE EVALUATION BOARD CONCLUDED THAT
ONLY THE PROPOSALS SUBMITTED BY THE TWO TOP-RANKED FIRMS, MCAUTO AND
ADTECH, WERE TECHNICALLY ACCEPTABLE. ADTECH WAS SELECTED FOR AWARD AND
THE UNSUCCESSFUL OFFERORS WERE SO NOTIFIED BY LETTER.
PRI CONTENDS THAT THE PROCUREMENT PROCESS WAS DELIBERATELY DISTORTED
IN ORDER TO ELIMINATE PRI'S LOW COST, TECHNICALLY ACCEPTABLE OFFER AND
THEREBY CLEAR THE WAY FOR AWARD TO ADTECH WITHOUT THE NECESSITY FOR
JUSTIFYING ITS HIGHER COST. TO THIS END, PRI BELIEVES THAT ITS PROPOSAL
WAS CRITICIZED FOR ALLEGED DEFICIENCIES IN AREAS WHERE ADTECH'S PROPOSAL
CONTAINED SIMILAR OR EVEN MORE SERIOUS DEFICIENCIES. THE PROTESTER ALSO
LISTS A NUMBER OF EXAMPLES OF THE EVALUATORS' CRITICISMS OF ADTECH'S
PROPOSAL THAT ARE, IN ITS OPINION, AS SERIOUS AS THOSE NOTED FOR PRI'S
PROPOSAL.
THE DETERMINATION OF THE RELATIVE DESIRABILITY OF PROPOSALS,
PARTICULARLY WITH RESPECT TO TECHNICAL CONSIDERATIONS, IS PRIMARILY A
MATTER FOR JUDGMENT OF THE CONTRACTING OFFICIALS. SKYWAYS, INC.,
B-201541, JUNE 2, 1981, 81-1 CPD 439. OUR FUNCTION IS NOT TO EVALUATE
PROPOSALS ANEW AND MAKE OUR OWN DETERMINATIONS AS TO THEIR ACCEPTABILITY
OR RELATIVE MERITS, BUT TO EXAMINE THE RECORD AND APPLY A STANDARD OF
REASONABLENESS TO THE CONTRACTING OFFICER'S DETERMINATION. THE FACT
THAT THE PROTESTER DOES NOT AGREE WITH AN AGENCY'S EVALUATION OF ITS
PROPOSAL DOES NOT RENDER THE EVALUATION UNREASONABLE. DECILOG,
B-198614, SEPTEMBER 3, 1980, 80-2 CPD 169.
THE SOLICITATION STATED THAT TECHNICAL PROPOSALS WOULD BE EVALUATED
IN ACCORDANCE WITH THE FOLLOWING CRITERIA:
"A. KNOWLEDGE OF COMBAT VEHICLES AND ENGINES
B. ABILITY OF THE PROPOSED APPROACH TO
IDENTIFY TRADE-OFF POTENTIAL AMONG
DIFFERENT TYPES OF AMMUNITION,
DEPENDING ON RELATIVE COST AND
EFFECTIVENESS
C. KNOWLEDGE OF DOD ACQUISITION PROCESS
D. TEST AND EVALUATION
E. MANAGEMENT PLAN
F. EXPERIENCE AND QUALIFICATIONS OF THE
PROPOSER IN DEVELOPING MATHEMATICAL
MODELS OR SIMULATION WHICH CAN BE USED
TO FORECAST RESOURCE REQUIREMENTS,
GIVEN ESTIMATES OF PARAMETERS WHICH
AFFECTS THE CONSUMPTION OF THOSE
RESOURCES.
G. RESPONSE TIME
H. PRODUCTION AND FIELDING
I. ACADEMIC QUALIFICATIONS OF PERSONNEL
EMPLOYED BY THE PROPOSER."
THE EVALUATORS FOUND THAT FOR FOUR OF THESE SEVEN CRITERIA -
KNOWLEDGE OF COMBAT VEHICLES; TRADE OFF ANALYSIS FOR AMMUNITION; TEST
AND EVALUATION; AND PRODUCTION AND FIELDING - PRI'S PROPOSAL WAS
UNSATISFACTORY. IN THE OPINION OF THE EVALUATORS, PRI'S PROPOSAL WAS
FUNDAMENTALLY DEFICIENT IN THESE AREAS, SUCH THAT THE EVALUATORS
PREPARED A DEFICIENCY NOTICE FOR EACH IN ACCORDANCE WITH THE SOURCE
SELECTION EVALUATION GUIDE PROCEDURES. FOR EXAMPLE, IN THE AREA OF TEST
AND EVALUATION, THE EVALUATORS CONCLUDED THAT PRI'S "(A)DDRESSAL OF THIS
FACTOR WAS SUBSTANTIALLY DEFICIENT ..." SUCH THAT PRI HAD NOT
"DEMONSTRATED AN UNDERSTANDING OR CAPABILITY IN THIS AREA."
ON THE OTHER HAND, THE EVALUATORS NOTED NO CONCERNS WARRANTING A
DEFICIENCY NOTICE IN ADTECH'S CASE, BUT SIMPLY REQUESTED CLARIFICATION
OF ITS MANAGEMENT PLAN AND CERTAIN ASPECTS OF ITS PROPOSED TEST AND
EVALUATION METHODS.
THE FACT THAT THE MINOR CONCERNS NOTED BY THE EVALUATORS IN THE
ADTECH PROPOSAL SOMETIMES TOUCH UPON THE SAME BROAD AREAS OF CONCERN
NOTED IN THE PRI PROPOSAL AND THAT THE EVALUATORS HAD RELATIVELY THE
SAME OVERALL NUMBER OF CONCERNS RELATING TO BOTH PROPOSALS IS NOT
DETERMINATIVE, BECAUSE THE EVALUATORS CONSIDERED THE DEFICIENCIES IN THE
PRI PROPOSAL TO BE SUBSTANTIAL AND THOSE IN THE ADTECH PROPOSAL TO BE
MINOR.
IN SUMMARY, THE MARINE CORPS REPORTS THAT THE ADTECH PROPOSAL
CONSISTENTLY REFLECTS A MORE THOROUGH, PRECISE UNDERSTANDING OF THE
OPERATING ENVIRONMENT, METHODS AND PROBLEMS ENCOUNTERED BY THE WEAPONS
BRANCH AND THE AMMUNITION AND MISSILE BRANCH OF THE MATERIEL DIVISION.
OUR REVIEW OF THE RECORD INDICATES THAT THIS CONCLUSION IS NOT
UNREASONABLE. ADTECH'S APPARENTLY MORE COMPLETE KNOWLEDGE OF THE WORK
MAY WELL BE ATTRIBUTABLE TO ITS PRIOR WORK UNDER ANOTHER MARINE CORPS
SUPPORT SERVICE CONTRACT, WHICH PRI DESCRIBES AS SO DIRECTLY RELATED TO
THE PRESENT CONTRACT THAT ADTECH WAS "VIRTUALLY AN INCUMBENT CONTRACTOR
WHEN IT COMPETED." WHILE IT HAS NOT BEEN ARGUED, THE COMPETITIVE
ADVANTAGE OF INCUMBENCY ON A SIMILAR CONTRACT IS NOT NORMALLY CONSIDERED
UNFAIR. SEE ROMAR CONSULTANTS, INC., B-206489, OCTOBER 15, 1982, 82-2
CPD 339.
PRI ALSO STATES THAT IT PROPOSED 34 INDIVIDUALS WITH UNDENIABLE
EXPERTISE IN COMBAT OPERATIONS, LOGISTICS AND A NUMBER OF OTHER
PERTINENT AREAS. HOWEVER, AS COMPARED TO THE EVEN MORE PERTINENT
EXPERIENCE OF ADTECH'S PERSONNEL, WE CANNOT SAY THAT THE EVALUATORS'
CRITICISM OF PRI'S PERSONNEL QUALIFICATIONS WAS UNREASONABLE. FOR
EXAMPLE, IN THE AMMUNITION AREA, ADTECH PROPOSED THE INDIVIDUAL WHO
DEVISED THE CURRENT METHODOLOGY USED BY THE MARINE CORPS TO DETERMINE
INVENTORIES OF ITS MOST EXPENSIVE MUNITIONS AND ANOTHER WHO PREVIOUSLY
HEADED THE AMMUNITION BRANCH. IN COMPARISON, THE EXPERIENCE OF PRI'S
EMPLOYEES WAS MORE GENERALIZED. WITH REGARD TO THE AMMUNITION AND
MISSILES BRANCH, THE EVALUATORS FELT THAT PRI'S PROPOSED PERSONNEL DID
NOT HAVE ADEQUATE EXPERIENCE IN THE SPECIFIC AREA OF PROVIDING
ENGINEERING SUPPORT FOR THE PRODUCTION AND FIELDING OF COMBAT VEHICLES
AND FOR THE TEST AND EVALUATION OF SUCH VEHICLES. APPARENTLY THE
EVALUATORS DID NOT VIEW EXPERIENCE IN SUPPORTING, MAINTAINING OR USING
COMBAT VEHICLES, OR ANALYZING THEIR USE, OR PROVIDING COMPARABLE SUPPORT
FOR OTHER TYPES OF MILITARY EQUIPMENT, AS EQUIVALENT TO THE SPECIFIC
EXPERIENCE DESIRED. WE SEE NO BASIS TO QUESTION THE REASONABLENESS OF
SUCH A JUDGMENT.
PRI ALSO CONTENDS THAT THE MARINE CORPS FAILED TO ENGAGE IN
MEANINGFUL DISCUSSIONS DURING ITS NOVEMBER 10 TELEPHONE CONVERSATION, AS
CONFIRMED BY LETTER OF THAT SAME DATE. ACCORDING TO PRI, BECAUSE OF THE
TOTAL ABSENCE OF SPECIFICITY IN THE FOUR GENERIC AREAS IDENTIFIED IN
THESE DISCUSSIONS, AND BECAUSE OF THE USE OF THE WORD "CLARIFICATION"
RATHER THAN WORDS LIKE "WEAKNESS" OR "DEFICIENCY," PRI REASONABLY
BELIEVED THAT THERE WAS NO SERIOUS WEAKNESS IN ITS PROPOSAL. PRI
QUESTIONS WHETHER DISCUSSIONS COULD HAVE BEEN MEANINGFUL IN ANY EVENT,
SINCE THEY WERE CONDUCTED BY A CONTRACT NEGOTIATOR RATHER THAN A
QUALIFIED TECHNICAL REPRESENTATIVE.
WITH CERTAIN EXCEPTIONS NOT RELEVANT HERE, 10 U.S.C. 2304(G) (1982)
AND ITS IMPLEMENTING REGULATION, DEFENSE ACQUISITION REGULATION (DAR)
SEC. 3-805.1, REQUIRE THE CONDUCT OF WRITTEN OR ORAL DISCUSSIONS WITH
ALL RESPONSIBLE OFFERORS WHO SUBMIT PROPOSALS WITHIN A COMPETITIVE
RANGE. WHILE NEITHER THE STATUTE NOR THE REGULATION OUTLINES THE EXTENT
OF SUCH DISCUSSIONS, OTHER THAN TO REQUIRE THAT OFFERORS BE GIVEN A
REASONABLE OPPORTUNITY TO CORRECT OR RESOLVE DEFICIENCIES NOTED BY THE
PROCURING AGENCY, IT HAS BEEN OUR POSITION THAT THESE DISCUSSIONS MUST
BE "MEANINGFUL." THE WORD "MEANINGFUL" IS A FLEXIBLE CONCEPT THAT MUST
RELATE TO THE SPECIFIC PROCUREMENT INVOLVED, AND WHAT ARE MEANINGFUL
DISCUSSIONS IN ONE PROCUREMENT MAY NOT BE CONSIDERED MEANINGFUL IN THE
CONTEXT OF ANOTHER. SET CORPORATION, B-207936, APRIL 15, 1983, 83-1 CPD
409. IN THIS RESPECT, WE RECOGNIZE THAT, AS IN THE EVALUATION OF
PROPOSALS, THE EXTENT OF DISCUSSIONS NECESSARY TO BE CONSIDERED
MEANINGFUL IS ESSENTIALLY A MATTER OF THE NEGOTIATOR'S JUDGMENT WHICH WE
WILL NOT QUESTION UNLESS WE FIND THE JUDGMENT TO HAVE BEEN UNREASONABLE.
ID. THUS, FOR EXAMPLE, WE HAVE HELD THAT AGENCY STATEMENTS MADE DURING
DISCUSSIONS THAT LEAD OFFERORS INTO PARTICULAR AREAS OF THEIR PROPOSALS
ARE SUFFICIENT TO PUT THEM ON NOTICE THAT THEIR PROPOSALS ARE DEFICIENT
IN THOSE AREAS. CRC SYSTEMS, INC., B-207847, MAY 2, 1983, 83-1 CPD 462.
WE THINK THAT THE DISCUSSIONS HERE HAVE SATISFIED THIS TEST.
THE TELEPHONE DISCUSSION APPEARS TO HAVE CONSISTED OF THE CONTRACT
NEGOTIATOR READING THE LETTER OF NOVEMBER 10 TO PRI'S REPRESENTATIVE,
WHICH LETTER STATES, IN ENTIRETY WITH REGARD TO PRI'S TECHNICAL
PROPOSAL, THE FOLLOWING:
"DURING THOSE DISCUSSIONS YOU WERE ADVISED
THAT THE FOLLOWING DISCREPANCIES EXIST IN
YOUR PROPOSAL SUBMISSION:
"TECHNICAL
1. CLARIFICATION OF PROPOSER'S OWN UNDERSTANDING
OF THE LEVEL OF EFFORT AND THE
PROPOSED APPROACH TO SUPPORT THE FOLLOWING
TASKS AREAS:
A. TRADE-OFF ANALYSIS FOR AMMUNITION
B. ENGINEERING SUPPORT FOR COMBAT WEAPON SYSTEMS
C. TEST AND EVALUATION
D. PRODUCTION AND FIELDING"
AS NOTED PREVIOUSLY, THE EVALUATORS HAD MAJOR CONCERNS REGARDING
THOSE FOUR AREAS, SUCH THAT THEY PREPARED DEFICIENCY NOTICES FOR EACH.
FOR EXAMPLE, FOR TEST AND EVALUATION, THE EVALUATORS SUMMARIZED PRI'S
PROPOSED APPROACH AS SUBSTANTIALLY DEFICIENT BECAUSE PRI HAD FAILED TO
DEMONSTRATE ITS UNDERSTANDING OR CAPABILITY. THE EVALUATORS' CONCERNS
REGARDING THE OTHER FACTORS GIVEN DEFICIENCY NOTICES WERE SIMILARLY
BROAD IN SCOPE, RAISING QUESTIONS AS TO WHETHER PRI HAD DEMONSTRATED AN
ADEQUATE UNDERSTANDING OF THE AREA, RATHER THAN CITING SPECIFIC
PROBLEMS, INCONSISTENCIES, AND THE LIKE.
IT IS UNDOUBTEDLY TRUE THAT THE MARINE CORPS COULD HAVE EXPANDED ITS
GENERALIZED STATEMENTS OF CONCERN INTO POINT-BY-POINT ANALYSES OF THE
VARIOUS SHORTCOMINGS OF PRI'S PROPOSAL. HOWEVER, SUCH A DETAILED
CRITIQUE WOULD HAVE BEEN INCONSISTENT WITH THE BASIC PURPOSE OF THE
EVALUATION, WHICH WAS TO ASCERTAIN THE EXTENT OF THE OFFEROR'S KNOWLEDGE
OF THE VARIOUS DISCIPLINES REQUIRED AS THEY APPLIED TO THE SPECIFIC
ORGANIZATIONAL ELEMENTS TO BE SUPPORTED UNDER THIS PROCUREMENT. IN THIS
REGARD, BOTH THE EVALUATION CRITERIA AND THE NARRATIVE EXPLANATIONS
FOLLOWING THEM REPEATEDLY STATE THAT THE OFFEROR MUST DEMONSTRATE ITS
KNOWLEDGE AND UNDERSTANDING OF THE MARINE CORPS ACTIVITIES IN QUESTION.
IN THE CONTEXT OF THIS PROCUREMENT, WHICH SOUGHT SPECIALIZED ENGINEERING
AND SUPPORT SERVICES FOR ORGANIZATIONS HAVING NARROWLY DEFINED
FUNCTIONS, WE BELIEVE THAT THE MARINE CORPS HAD A REASONABLE BASIS FOR
PHRASING THE DEFICIENCIES IN A GENERALIZED MANNER, LEAVING IT TO THE
OFFEROR TO FURTHER CLARIFY ITS KNOWLEDGE AND UNDERSTANDING OF THOSE
ACTIVITIES WHEN ITS UNDERSTANDING WAS CRITICIZED. SEE SET CORPORATION,
SUPRA.
AS TO WHETHER THE MARINE CORPS SUFFICIENTLY COMMUNICATED THE
SERIOUSNESS OF THE EVALUATORS' CONCERNS, WE BELIEVE THAT THE TERMINOLOGY
USED, ASKING FOR A CLARIFICATION OF PRI'S "OWN UNDERSTANDING OF THE
LEVEL OF EFFORT AND PROPOSED APPROACH" NEEDED TO SUPPORT THE TASK
CONVEYED THE SERIOUS NATURE OF THE MARINE CORPS' CONCERNS IN A
MEANINGFUL, ALBEIT MINIMAL, MANNER. IN THIS REGARD, PRI WAS ASKED, IN
EFFECT, TO REVIEW ITS ENTIRE APPROACH TO THE TASK IN QUESTION, RATHER
THAN CLARIFY ONE OR MORE SPECIFIC POINTS.
WITH RESPECT TO THE CONTRACT NEGOTIATOR'S ABILITY TO CONDUCT
MEANINGFUL DISCUSSIONS, THE FACT THAT THE MARINE CORPS USED THIS
INDIVIDUAL RATHER THAN A TECHNICALLY QUALIFIED REPRESENTATIVE TO CONDUCT
DISCUSSIONS WAS UNDOUBTEDLY KNOWN TO PRI AT THE TIME DISCUSSIONS WERE
HELD, ON NOVEMBER 10, 1982. ANY PROTEST OF THIS ACTION SHOULD HAVE BEEN
FILED WITHIN 10 WORKING DAYS AND WAS THEREFORE UNTIMELY WHEN RECEIVED BY
OUR OFFICE ON FEBRUARY 4, 1983. 4 C.F.R. SEC. 21.2(B)(2) (1983). IN
ANY EVENT, DAR SEC. 3-805.3 REQUIRES ONLY THAT OFFERORS BE ADVISED OF
DEFICIENCIES IN THEIR PROPOSALS. THE CONTRACT NEGOTIATOR DID THIS,
RELYING ON THE SYNOPSIS OF DEFICIENCIES CONVEYED TO HIM BY THE SOURCE
SELECTION EVALUATION BOARD'S MEMORANDUM.
TO RECAPITULATE, THE RECORD SUPPORTS BOTH THE MARINE CORPS'
DETERMINATION THAT PRI'S INITIAL PROPOSAL WAS TECHNICALLY UNACCEPTABLE
BUT SUSCEPTIBLE OF UPGRADING TO ACCEPTABILITY AND THE ADEQUACY OF THE
MARINE CORPS' CONDUCT OF WRITTEN AND ORAL DISCUSSIONS WITH PRI.
CONSEQUENTLY, THE MARINE CORPS HAD A REASONABLE BASIS FOR ELIMINATING
PRI'S PROPOSAL FROM THE COMPETITIVE RANGE AS TECHNICALLY UNACCEPTABLE
WHEN PRI'S BEST AND FINAL OFFER FAILED TO SIGNIFICANTLY IMPROVE ITS
TECHNICAL PROPOSAL. THIS BEING THE CASE, PRI'S ALLEGATIONS CONCERNING
THE EVALUATION OF ITS PRICE PROPOSAL AND PAST EXPERIENCE ARE ESSENTIALLY
ACADEMIC, SINCE PRI'S TECHNICALLY UNACCEPTABLE PROPOSAL WAS NO LONGER A
CANDIDATE FOR AWARD IN ANY EVENT.
PRI FURTHER CONTENDS THAT ADTECH HAD NO INTENTION OF ASSIGNING ITS
PROPOSED PERSONNEL TO THE CONTRACT TO BE AWARDED, ALLEGING THAT ONE
PARTICULAR ADTECH EMPLOYEE IS COMMITTED FULL TIME TO ANOTHER CONTRACT
AWARDED THROUGH THE NAVY. THE MARINE CORPS REPLIES THAT THE INDIVIDUAL
IN QUESTION IS NO LONGER UTILIZED FULL TIME UNDER THE OTHER CONTRACT.
IN VIEW OF THESE CONFLICTING STATEMENTS, PRI HAS NOT CARRIED THE BURDEN
OF AFFIRMATIVELY PROVING ITS CASE AS TO THIS ISSUE. THE FMI-HAMMER
JOINT VENTURE, B-206665, AUGUST 20, 1982, 82-2 CPD 160. MOREOVER, AS
THE MARINE CORPS POINTS OUT, BECAUSE THE CONTRACT IS FOR SUPPORT
SERVICES, NOT PERSONAL SERVICES, ADTECH IS ONLY REQUIRED TO FURNISH
PERSONNEL WITH EXPERIENCE AND QUALIFICATIONS COMPARABLE TO THOSE
INDIVIDUALS IDENTIFIED IN ITS PROPOSAL, RATHER THAN SPECIFIC
INDIVIDUALS, SHOULD IT BE ISSUED A DELIVERY ORDER COVERING SERVICES OF
THE TYPE PERFORMED BY THE NAMED INDIVIDUALS.
FURTHER, PRI CONTENDS THAT AWARD TO ADTECH CREATES AN ORGANIZATIONAL
CONFLICT OF INTEREST WITH REGARD TO ITS UNDERTAKINGS UNDER OTHER
CONTRACTS IN SUPPORT OF THE MARINE CORPS. IN ESSENCE, PRI ARGUES THAT
ADTECH PROVIDES SUPPORT SERVICES FOR A NUMBER OF MARINE CORPS ELEMENTS
THAT DEAL WITH THE SAME ISSUES OR SUBJECTS, SO THAT ITS ROLES WOULD
OVERLAP, I.E., IT WOULD BE REVIEWING OR COMMENTING UPON DOCUMENTS IN
BEHALF OF ONE ORGANIZATIONAL ELEMENT THAT IT PREPARED FOR ANOTHER
ORGANIZATIONAL ELEMENT. THE MARINE CORPS RESPONDS THAT IT RECOGNIZES
THE POSSIBILITY OF CONFLICTING ROLES AND THAT IT WILL AVOID SUCH
OCCURRENCES BY MONITORING THE TASK ORDERS ISSUED TO ADTECH.
IT IS NOT CLEAR THAT THE POSSIBILITY OF OVERLAPPING SUPPORT SERVICES
ROLES SHOULD BE VIEWED AS CONFLICTING, SINCE NO IDENTIFIABLE FINANCIAL
ADVANTAGE WOULD ACCRUE TO THE CONTRACTOR IN THESE CIRCUMSTANCES.
NEVERTHELESS, THE MARINE CORPS STATES THAT IT WILL AVOID OVERLAPPING
ROLES FOR ADTECH BY POLICING ITS DELIVERY ORDERS WHICH SHOULD AVOID
WHATEVER CONFLICT THAT MAY BE SAID TO EXIST. THE ACTUAL ASSIGNMENT OF
DELIVERY ORDERS IS, OF COURSE, A MATTER OF CONTRACT ADMINISTRATION WHICH
THIS OFFICE WILL NOT REVIEW.
FINALLY, PRI ALLEGES THAT CERTAIN DOCUMENTS IN THE PROCUREMENT FILE,
WHICH HAVE NOT BEEN RELEASED TO PRI, WERE "WRITTEN AFTER PRI'S FEBRUARY
10, 1983 INITIAL DEBRIEFING SESSION AS A RESULT OF PRI'S QUESTIONS
REGARDING THE SPECIFIC BASES FOR REJECTION OF ITS PROPOSAL" IN ORDER TO
JUSTIFY THE MARINE CORPS' POSITION. WE HAVE EXPLAINED TO PRI THAT THE
DOCUMENTS IN QUESTION CONSIST OF TWO MEMORANDA DATED SEPTEMBER 2 AND
NOVEMBER 20, 1982 FROM THE CHAIRMAN OF THE SOURCE SELECTION EVALUATION
BOARD TO THE DIRECTOR OF THE CONTRACTS DIVISION REPORTING THE RESULTS OF
THE BOARD'S INITIAL AND FINAL EVALUATIONS, THAT THEY ARE MORE THAN 50
PAGES LONG AND THAT THERE IS ABSOLUTELY NO EVIDENCE IN THE RECORD WHICH
IN ANY MANNER CORROBORATES PRI'S ACCUSATION. IN VIEW OF THE LACK OF ANY
EVIDENCE IN THE RECORD TO SUPPORT PRI'S ALLEGATION, WE CONSIDER IT
SPECULATIVE AND WITHOUT MERIT. CONSOLIDATED SERVICES, INC., B-206413.3,
FEBRUARY 28, 1983, 83-1 CPD 192.
THE PROTEST IS DENIED.
B-210713, MAY 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. AN EMPLOYEE IS INDEBTED TO GOVERNMENT BECAUSE HE EXCEEDED HIS
AUTHORIZED WEIGHT ALLOWANCE FOR SHIPMENT OF HOUSEHOLD GOODS. HE CLAIMS
THE WEIGHT OF HIS SHIPMENT FROM GERMANY TO MICHIGAN SHOULD HAVE BEEN
REDUCED BY 15 PERCENT FOR WEIGHT OF BRACING AND PADDING MATERIAL.
WEIGHT RECEIPTS SHOW THAT PADDING AND BRACING MATERIALS RETURNED TO THE
WAREHOUSE WERE WEIGHED SEPARATELY AND THEIR WEIGHT WAS INCLUDED IN TARE
WEIGHT OF SHIPMENT. SINCE WEIGHT OF PADDING AND BRACING WAS, THEREFORE,
EXCLUDED FROM NET WEIGHT, EMPLOYEE IS NOT ENTITLED TO 15 PERCENT
REDUCTION UNDER VOLUME 2 OF THE JOINT TRAVEL REGULATIONS, PARAGRAPH
C7050-2C.
2. AN EMPLOYEE IS INDEBTED TO GOVERNMENT BECAUSE HE EXCEEDED HIS
AUTHORIZED WEIGHT ALLOWANCE FOR SHIPMENT OF HOUSEHOLD GOODS. HE CLAIMS
WEIGHT FOR SHIPMENT OF HOUSEHOLD GOODS FROM CALIFORNIA TO MICHIGAN WAS
ERRONEOUS. ALTHOUGH HE CLAIMS THAT HIS WIFE WITNESSED A REWEIGH THAT
REDUCED THE WEIGHT OVER 300 POUNDS, IN THE ABSENCE OF WEIGHT
CERTIFICATES OR OTHER DEMONSTRATIVE EVIDENCE TO SUPPORT THIS ALLEGATION,
WE MUST ACCEPT THE AGENCY DETERMINATION THAT THE WEIGHT STATED ON THE
GOVERNMENT BILL OF LADING WAS CORRECT.
3. AN EMPLOYEE STATES THAT HE MOVED 12 TIMES IN 16 YEARS PRECEDING
MOVE FOR WHICH HE BECAME INDEBTED TO GOVERNMENT FOR EXCEEDING THE
AUTHORIZED WEIGHT ALLOWANCE. HE INDICATES THAT HE NEVER EXCEEDED
AUTHORIZED WEIGHT ALLOWANCE PREVIOUSLY. HOWEVER, WEIGHTS OF PREVIOUS
SHIPMENTS ARE NOT RELEVANT TO DETERMINING WEIGHT OF DISPUTED SHIPMENT
SINCE INCLUSIONS AND EXCLUSIONS OF HOUSEHOLD GOODS MAY HAVE OCCURRED.
CHARLES L. EPPRIGHT:
BY LETTER OF SEPTEMBER 9, 1982, MR. CHARLES L. EPPRIGHT APPEALED OUR
CLAIMS GROUP'S DETERMINATION OF HIS INDEBTEDNESS FOR THE EXCESS WEIGHT
OF HOUSEHOLD GOODS SHIPPED INCIDENT TO HIS TRANSFER AS A CIVILIAN
EMPLOYEE OF THE DEPARTMENT OF THE ARMY. BASED ON OUR DETERMINATION THAT
THE WEIGHT OF THE GOODS SHIPPED WAS CORRECTLY DETERMINED, WE SUSTAIN THE
ACTION OF THE CLAIMS GROUP.
INCIDENT TO HIS TRANSFER FROM GERMANY TO MICHIGAN IN 1974, THE
CLAIMANT WAS AUTHORIZED TO SHIP HOUSEHOLD GOODS WEIGHING NOT IN EXCESS
OF 11,000 POUNDS, THE MAXIMUM THAT MAY BE SHIPPED AT GOVERNMENT EXPENSE
UNDER 5 U.S.C. 5724(A). HIS HOUSEHOLD GOODS WERE TRANSPORTED FROM
GERMANY TO MICHIGAN IN TWO SHIPMENTS UNDER GOVERNMENT BILLS OF LADING
(GBL) NO. K-6,601,225 AND NO. K-6,601,245 REFLECTING NET WEIGHTS OF
10,663 POUNDS AND 282 POUNDS, RESPECTIVELY. ADDITIONAL HOUSEHOLD GOODS
TAKEN OUT OF STORAGE IN CALIFORNIA WERE SHIPPED TO MICHIGAN UNDER GBL
NO. K-6,682,341 REFLECTING A NET WEIGHT OF 4,380 POUNDS. BASED ON A
REWEIGH THE NET WEIGHT OF THE GOODS TRANSPORTED UNDER GBL NO.
K-6,601,225 WAS DETERMINED TO BE 9,660 POUNDS AND MR. EPPRIGHT WAS GIVEN
A 15 PERCENT ALLOWANCE FOR BRACING AND PADDING UNDER GBL NO.
K-6,601,245, REDUCING THE NET WEIGHT OF THAT SHIPMENT TO 240 POUNDS.
SINCE THE NET WEIGHTS OF THE HOUSEHOLD GOODS TRANSPORTED UNDER THE THREE
GOVERNMENT BILLS OF LADING TOTALED 14,280 POUNDS, MR. EPPRIGHT WAS
BILLED $787.15 FOR TRANSPORTATION CHARGES ATTRIBUTABLE TO THE 3,280
POUNDS BY WHICH HIS HOUSEHOLD GOODS SHIPMENT EXCEEDED THE 11,000-POUND
STATUTORY MAXIMUM.
MR. EPPRIGHT QUESTIONED THE ARMY'S DETERMINATION OF EXCESS WEIGHT.
HE DID NOT SPECIFICALLY CHALLENGE THE 9,660-POUND NET WEIGHT OF THE
LARGER SHIPMENT FROM GERMANY AS DETERMINED BY THE REWEIGH. HOWEVER, HE
CLAIMED A 15 PERCENT ALLOWANCE FOR BRACING AND PADDING MATERIALS WHICH
WOULD REDUCE THE NET WEIGHT OF THAT SHIPMENT TO 8,211 POUNDS. FOR THE
CALIFORNIA SHIPMENT, HE BELIEVED THAT THE CORRECT WEIGHT SHOULD HAVE
BEEN 4,050 POUNDS BASED ON A REWEIGH WITNESSED BY HIS WIFE. THE ARMY
AND THE CLAIMS GROUP DENIED A 15 PERCENT ALLOWANCE ON THE LARGER
SHIPMENT FROM GERMANY ON THE BASIS THAT THE TARE RATHER THAN THE NET
WEIGHT OF THE SHIPMENT INCLUDED THE WEIGHT OF BRACING AND PADDING.
ABSENT DOCUMENTATION OF A LOWER WEIGHT, THE ARMY AND THE CLAIMS GROUP
ACCEPTED THE 4,380-POUND NET WEIGHT OF THE CALIFORNIA SHIPMENT STATED IN
THE GBL.
IN APPEALING FROM THE CLAIMS GROUP'S DETERMINATION, MR. EPPRIGHT
ASSERTED THAT THE WEIGHT OF PACKING MATERIALS WAS NOT IN FACT EXCLUDED
FROM THE NET WEIGHT OF THE LARGER SHIPMENT FROM GERMANY AND THAT THE
15-PERCENT REDUCTION FOR THAT SHIPMENT SHOULD HAVE BEEN ALLOWED. HE
SUGGESTED THAT A REWEIGH OF THAT SHIPMENT WOULD HAVE RESULTED IN A
FURTHER REDUCTION IF IT HAD BEEN WITNESSED BY THE CONTRACTING OFFICER'S
REPRESENTATIVE AND HE STATED THAT THE DRIVER'S FAILURE TO OBTAIN
DOCUMENTATION AND THUS TO COMPLY WITH AN OFFICIAL REQUEST TO REWEIGH THE
CALIFORNIA SHIPMENT RESULTED IN AN ERRONEOUS DETERMINATION OF THE NET
WEIGHT OF THAT PARTICULAR SHIPMENT. HE STATED THAT INCIDENT TO HIS
EARLIER MOVE TO GERMANY HE HAD REPORTED TO THE CONTRACTING OFFICER THAT
HE BELIEVED THE WEIGHT OF GOODS PLACED IN STORAGE HAD BEEN OVERSTATED BY
AS MUCH AS 1,500 POUNDS AND HAD BEEN ADVISED THAT ANY DISCREPANCY SHOULD
BE RESOLVED BY REWEIGHING THE SHIPMENT WHEN IT WAS REMOVED FROM STORAGE.
HE ADDED THAT HIS HOUSEHOLD GOODS WERE TRANSPORTED AT GOVERNMENT
EXPENSE INCIDENT TO TWELVE EARLIER MOVES AND HAD NEVER EXCEEDED THE
APPLICABLE 11,000-POUND LIMITATION.
THE NET WEIGHT OF A SHIPMENT IS EQUAL TO THE GROSS WEIGHT MINUS THE
TARE WEIGHT. THE PROPER MEANS OF DETERMINING THE NET WEIGHT OF A
SHIPMENT SUCH AS MR. EPPRIGHT'S CONTAINERIZED SHIPMENT FROM GERMANY IS
ADDRESSED BY THE FOLLOWING PROVISION FROM PARAGRAPH C7050-2C OF VOLUME 2
OF THE JOINT TRAVEL REGULATIONS:
"C. CONTAINERIZED SHIPMENTS. WHEN
SPECIAL CONTAINERS DESIGNED NORMALLY FOR
REPEATED USE, SUCH AS LIFT VANS, CONEX
TRANSPORTERS, AND HOUSEHOLD GOODS SHIPPING
BOXES ARE USED AND THE KNOWN TARE WEIGHT DOES
NOT INCLUDE THE WEIGHT OF INTERIOR BRACING
AND PADDING MATERIALS BUT ONLY THE WEIGHT OF
THE CONTAINER, THE NET WEIGHT OF THE HOUSEHOLD
GOODS SHALL BE 85 PERCENT OF THE GROSS
WEIGHT LESS THE WEIGHT OF THE CONTAINER. IF
THE KNOWN TARE WEIGHT INCLUDES INTERIOR BRACING
AND PADDING MATERIALS SO THAT THE NET WEIGHT IS
THE SAME AS IT WOULD BE FOR UNCRATED SHIPMENTS
IN INTERSTATE COMMERCE, THE NET WEIGHT
SHALL NOT BE SUBJECT TO THE ABOVE REDUCTION.
IF THE GROSS WEIGHT OF THE CONTAINER CANNOT
BE OBTAINED, THE NET WEIGHT OF THE HOUSEHOLD
GOODS SHALL BE DETERMINED FROM THE CUBIC
MEASUREMENT ON THE BASIS OF 7 POUNDS PER
CUBIC FOOT OF PROPERLY LOADED CONTAINER
SPACE." UNDER THIS REGULATION MR. EPPRIGHT'S ENTITLEMENT TO A 15
PERCENT REDUCTION IN THE NET WEIGHT OF THE LARGER SHIPMENT FROM GERMANY
DEPENDS ON THE CORRECTNESS OF THE AGENCY'S FACTUAL DETERMINATION THAT
THE WEIGHT OF BRACING AND PADDING MATERIALS WAS INCLUDED IN THE TARE
WEIGHT OF THE SHIPMENT.
WHERE THE RECORD DOES NOT ESTABLISH WHETHER THE WEIGHT OF INTERIOR
BRACING AND PADDING MATERIALS WAS INCLUDED IN THE TARE WEIGHT INDICATED
ON OFFICIAL WEIGHT DOCUMENTS, WE HAVE GIVEN THE EMPLOYEE THE BENEFIT OF
A PRESUMPTION THAT IT IS NOT INCLUDED IN THE TARE WEIGHT. IN THESE
CIRCUMSTANCES WE HAVE ALLOWED A 15 PERCENT REDUCTION IN THE NET WEIGHT
OF THE HOUSEHOLD GOODS SHIPPED. SEE MATTER OF TUCKER, 60 COMP.GEN. 300
(1981) AS MODIFIED IN OTHER RESPECTS BY MATTER OF SELNER, 61 COMP.GEN.
452 (1982). IN MR. EPPRIGHT'S CASE IT WOULD BE INAPPROPRIATE TO APPLY
THAT PRESUMPTION SINCE THE WEIGHT CERTIFICATES THEMSELVES ESTABLISH THAT
THE TARE WEIGHT DETERMINED AT THE TIME OF REWEIGHING INCLUDED THE WEIGHT
OF BRACING AND PADDING MATERIALS. THE NET WEIGHT OF 9,660 POUNDS WAS
BASED ON A GROSS WEIGHT OF 43,500 POUNDS LESS A TARE WEIGHT OF 33,840
POUNDS. THAT TARE WEIGHT FIGURE IS THE SUM OF SEPARATE TARE WEIGHTS OF
24,790 AND 8,220 POUNDS AND AN ADDITIONAL FACTOR OF 830 POUNDS. AS
SHOWN ON A SEPARATE WEIGHT CERTIFICATE, THAT 830 POUNDS IS THE
DIFFERENCE BETWEEN THE GROSS AND TARE WEIGHTS OF A VEHICLE "USED TO HAUL
TRASH AND PACKING MATERIAL BACK TO WAREHOUSE." THUS, THE 830 POUNDS
INCLUDED IN THE AGGREGATE TARE WEIGHT FIGURE IS THE WEIGHT OF REUSABLE
AS WELL AS WELL AS EXCESS PACKING, PADDING AND BRACING MATERIALS. THE
WEIGHING PROCEDURE USED BY THE CARRIER APPEARS TO BE IN COMPLIANCE WITH
THE REQUIREMENTS OF THE PERSONAL PROPERTY TRAFFIC MANAGEMENT REGULATIONS
(DOD 4500.34-R) THAT FOR "CODE 4" CONTAINERIZED SHIPMENTS, THE WEIGHT OF
PADDING, BLOCKING AND BRACING MATERIAL USED TO SECURE THE SHIPMENT WILL
BE INCLUDED IN THE TARE WEIGHT.
WHILE WE ARE OBLIGED TO DISALLOW MR. EPPRIGHT'S CLAIM FOR A 15
PERCENT REDUCTION IN THE NET WEIGHT OF THE LARGER SHIPMENT FROM GERMANY,
WE NOTE THAT THE NET WEIGHT FIGURE OF 9,660 POUNDS INCLUDES THE WEIGHT
OF SOME PACKING MATERIALS. AS DISTINGUISHED FROM THE TREATMENT OF
PADDING, BLOCKING AND BRACING MATERIALS, DOD 4500.34-R PROVIDES THAT THE
CARRIER WILL INVOICE FOR THE NET WEIGHT OF THE SHIPMENT WHICH WILL
CONSIST OF ACTUAL GOODS PLUS CARTONS, BARRELS, DRUMS AND WARDROBES USED
TO PACK FRAGILE ARTICLES AND THE NECESSARY WRAPPING, PACKING AND FILLER
MATERIAL. THE 15 PERCENT REDUCTION IS NOT AUTHORIZED FOR THESE
MATERIALS.
IN REGARD TO THE CALIFORNIA SHIPMENT, MR. EPPRIGHT'S BASIC CONTENTION
IS THAT THE CARRIER FAILED TO PROPERLY COMPLY WITH HIS REQUEST TO
REWEIGH THE SHIPMENT. AS PREVIOUSLY NOTED, THE CLAIMANT DOES ALLEGE
THAT HIS WIFE WAS PRESENT AT A REWEIGH BUT THIS REWEIGH NEVER RESULTED
IN ANY OFFICIAL WEIGHT TICKETS BEING RECEIVED BY THE ARMY. IN THE
ABSENCE OF SUCH WEIGHT CERTIFICATES AND SINCE NO AGENCY REPRESENTATIVE
WITNESSED THE REWEIGH, THE ARMY WAS REQUIRED TO ACCEPT THE WEIGHT OF
4,380 POUNDS RECORDED ON THE GBL.
THE GENERAL RULE IS THAT A CARRIER'S FAILURE TO COMPLY WITH A REQUEST
FOR A REWEIGH OF HOUSEHOLD GOODS DOES NOT GIVE AN EMPLOYEE A BASIS TO
DISPUTE THE RECORDED WEIGHT. SEE E.G., MATTER OF NEWMAN, B-195256,
NOVEMBER 15, 1979. THEREFORE, SINCE IT IS FOR AN AGENCY TO DETERMINE
THE WEIGHT OF HOUSEHOLD GOODS SHIPPED, WE GENERALLY DO NOT TAKE ISSUE
WITH THE AGENCY'S ADMINISTRATIVE DETERMINATION. SEE MATTER OF COMBS, 60
COMP.GEN. 336, 339 (1981); AND MATTER OF BROWN, AND SCHMIDT, B-199780,
FEBRUARY 17, 1981. INDEED, IT IS ONLY IF THE RECORD REVEALS CLEAR ERROR
THAT A CLAIMANT WILL HAVE MET HIS BURDEN TO PROVE THAT THE RECORDED
WEIGHT WAS INCORRECT. MATTER OF MARTELLO, B-198561, DECEMBER 24, 1980.
THERE IS NOTHING IN THE RECORD THAT EVIDENCES THERE WAS CLEAR ERROR IN
THE RECORDED WEIGHT. IN REACHING THIS CONCLUSION WE HAVE CONSIDERED MR.
EPPRIGHT'S ALLEGATIONS REGARDING THE REWEIGHT HOWEVER, IN THE ABSENCE OF
FURTHER EVIDENCE THESE ALLEGATIONS ARE NOT THE TYPE OF EVIDENCE
NECESSARY TO ESTABLISH CLEAR ERROR.
THE ABOVE DISCUSSION ADDRESSES ALL BUT THE ARGUMENT IMPLICIT IN MR.
EPPRIGHT'S CONTENTION THAT HIS PRIOR SHIPMENTS OF HOUSEHOLD GOODS DID
NOT EXCEED THE 11,000 POUND STATUTORY MAXIMUM. IT CONTINUES TO BE OUR
VIEW THAT THE WEIGHT OF PRIOR OR SUBSEQUENT SHIPMENTS IS NOT INDICATIVE
OF THE WEIGHT OF A SHIPMENT OF HOUSEHOLD GOODS BECAUSE OF THE
POSSIBILITY OF INCLUSION OR EXCLUSION OF ITEMS WHICH WOULD VARY THE
PRIOR WEIGHT OR SUBSEQUENT WEIGHTS. MATTER OF SUBOTNIK, B-206698,
NOVEMBER 30, 1982, CITING MATTER OF HALPIN, B-198367, MARCH 26, 1981.
SEE ALSO MATTER OF FINDLAY, B-198337, MAY 30, 1980, AND CASES CITED
THEREIN.
ACCORDINGLY, WE SUSTAIN THE DENIAL OF MR. EPPRIGHT'S CLAIM BY THE
CLAIMS GROUP.
B-210710, AUG 29, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST AGAINST AGENCY FAILURE TO
PROVIDE A PREAWARD NOTICE OF NONRESPONSIBILITY (WHICH WAS BASED ON
PROTESTER'S LACK OF FACILITIES AND FACT THAT PROTESTER HAD ONLY
BEEN IN BUSINESS FOR ONE MONTH) IS WITHOUT MERIT SINCE THERE IS NO
REQUIREMENT FOR SUCH NOTICE PRIOR TO MAKING A RESPONSIBILITY
DETERMINATION. DECISIONS REGARDING PROCEDURAL DUE PROCESS AND DE
FACTO DEBARMENT ARE DISTINGUISHABLE AND INAPPLICABLE.
2. CONTRACTING OFFICER HAS DISCRETIONARY
AUTHORITY REGARDING REFERRAL OF NEGATIVE DETERMINATION OF
RESPONSIBILITY TO SBA OF A CONTRACT VALUED AT LESS THAN $10,000.
CONTRACTING OFFICER DID NOT ABUSE HIS DISCRETION WHEN HE DID NOT
REFER NEGATIVE DETERMINATION BECAUSE THE PROCUREMENT WAS URGENT
AND VALUED AT ONLY $130.80-$144. NEGATIVE DETERMINATION WAS NOT
UNREASONABLE. RECORD DOES NOT SUPPORT PROTESTER'S CONTENTION THAT
DETERMINATION WAS BASED ON WALSH-HEALEY ACT, WHICH IS INAPPLICABLE
TO THIS (LESS THAN $10,000) PROCUREMENT.
3. PROCURING AGENCY IS NOT REQUIRED TO
CONDUCT PREAWARD SURVEY WHEN THE AGENCY IS IN POSSESSION OF
INFORMATION SUFFICIENT TO MAKE A RESPONSIBILITY DETERMINATION.
UNITED AIRCRAFT AND TURBINE CORPORATION:
UNITED AIRCRAFT AND TURBINE CORPORATION (UATC) PROTESTS THE AWARD OF
A CONTRACT BY THE DEFENSE INDUSTRIAL SUPPLY CENTER (DISC), DEFENSE
LOGISTICS AGENCY (DLA), TO JAMAICA BEARING CO., INC., AT A PRICE OF $144
FOR 40 STEEL SLEEVE BUSHINGS. THE BUSHINGS WERE PROCURED UNDER THE
SAMMS AUTOMATED SMALL PURCHASE SYSTEM (SASPS II). UATC SUBMITTED THE
LOW QUOTATION OF $130.80, BUT WAS REJECTED AS NONRESPONSIBLE BASED ON
INFORMATION CONTAINED IN DISC'S UATC VENDOR FILE. UATC PROTESTS THAT
THE NONRESPONSIBILITY DETERMINATION WAS IMPROPER BECAUSE IT WAS: (1)
MADE WITHOUT PROVIDING A PREAWARD NOTICE AND OPPORTUNITY TO BE HEARD;
(2) NOT REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA); (3) BASED
ON THE WALSH-HEALEY ACT, WHICH DOES NOT APPLY TO CONTRACTS UNDER
$10,000; AND (4) MADE WITHOUT CONDUCTING A PREAWARD SURVEY.
THE PROTEST IS DENIED.
THE CONTRACTING OFFICER BASED HIS NONRESPONSIBILITY DETERMINATION ON
THE FOLLOWING STATEMENTS FROM AN INTER-OFFICE MEMORANDUM CONTAINED IN
UATC'S VENDOR FILE:
"SUBJECT CONTRACTOR HAS BEEN IN BUSINESS
ONE MONTH, DOES NOT HAVE WAREHOUSE
FACILITIES NOR DO THEY INTEND TO CARRY ON
BUSINESS WITH COMMERCIAL CUSTOMERS. ***
"THE ABOVE CONDITIONS DO NOT QUALIFY THE
CONTRACTOR AS A REGULAR DEALER UNDER THE
WALSH-HEALEY PUBLIC CONTRACTS ACT AND, AS
SUCH, DO NOT MAKE THE CONTRACTOR ELIGIBLE
FOR PURCHASES OVER $10,000. ALTHOUGH THE
WALSH-HEALEY ACT DOES NOT APPLY TO
PURCHASES UNDER $10,000, THE CONDITIONS
NOTED IN PARAGRAPH 1 SHOULD BE CONSIDERED
WHILE MAKING A DETERMINATION OF
RESPONSIBILITY ON PURCHASES BELOW THAT
DOLLAR LEVEL."
A PREAWARD SURVEY WAS NOT CONSIDERED NECESSARY BECAUSE THE PURCHASE
REQUEST REFLECTED AN URGENT PRIORITY, AND THE DOLLAR VALUE OF THE
PROCUREMENT WAS SMALL ($130.80 QUOTED BY UATC AND $144 BY JAMAICA). THE
NONRESPONSIBILITY DETERMINATION WAS NOT REFERRED TO SBA FOR A
CERTIFICATE OF COMPETENCY DETERMINATION.
DUE PROCESS AND DE FACTO DEBARMENT
UATC CONTENDS THAT IT WAS ENTITLED TO PREAWARD NOTICE AS A MATTER OF
PROCEDURAL DUE PROCESS GUARANTEED BY THE FIFTH AMENDMENT OF THE
CONSTITUTION. UATC RELIES ON OLD DOMINION DAIRY PRODUCTS, INC. V.
SECRETARY OF DEFENSE, 631 F.2D 953, 968-69 (D.C. CIR. 1980); RELATED
INDUSTRIES, INC. V. THE UNITED STATES, NO. 237-83C, CL.CT., MAY 26,
1983, 1 FPD 134; AND 43 COMP.GEN. 140 (1963).
OUR OFFICE HAS HELD THAT A CONTRACTING OFFICER MAY BASE AN INITIAL
DETERMINATION OF NONRESPONSIBILITY UPON THE EVIDENCE OF RECORD WITHOUT
AFFORDING BIDDERS AN OPPORTUNITY TO EXPLAIN OR OTHERWISE DEFEND AGAINST
THE EVIDENCE. 43 COMP.GEN. SUPRA, AT 141; MAYFAIR CONSTRUCTION COMPANY,
B-192023, SEPTEMBER 11, 1978, 78-2 CPD 187; HOWARD FERRIEL & SONS,
INC., B-184692, MARCH 31, 1976, 76-1 CPD 211. ALTHOUGH DEFENSE
ACQUISITION REGULATION (DAR) SEC. 2-408.1 (1976 ED.) REQUIRES PROMPT
NOTIFICATION TO UNSUCCESSFUL BIDDERS THAT THEIR BIDS HAVE NOT BEEN
ACCEPTED, THERE IS NO REQUIREMENT THAT BIDDERS BE NOTIFIED IN ADVANCE OF
AWARD. HOWARD FERRIEL & SONS, INC., SUPRA.
THIS CASE IS DISTINGUISHABLE FROM BOTH OLD DOMINION DAIRY PRODUCTS,
INC., SUPRA, AND RELATED INDUSTRIES, INC., SUPRA, BECAUSE IT DOES NOT
INVOLVE A CONSTITUTIONAL INTEREST TO BE FREE FROM GOVERNMENTAL
DEFAMATION OF REPUTATION WHICH HAS AN IMMEDIATE AND TANGIBLE EFFECT ON
THE ABILITY TO DO BUSINESS. INSTEAD, THE NEGATIVE RESPONSIBILITY
DETERMINATION WAS BASED ON UATC'S LACK OF WAREHOUSE FACILITIES AND
DEMONSTRATED ABILITY. THIS DETERMINATION DID NOT AFFECT A
CONSTITUTIONAL INTEREST AND, THEREFORE, DID NOT TRIGGER DUE PROCESS
REQUIREMENTS. SEE BELL & HOWELL; TOPPER MANUFACTURING CORPORATION, 61
COMP.GEN. 596, 601 (1982), 82-2 CPD 224; NAVAJO FOOD PRODUCTS, INC.,
B-202433, SEPTEMBER 9, 1981, 81-2 CPD 206.
CONCERNING THE ALLEGED DE FACTO DEBARMENT, WE HAVE RECOGNIZED THAT A
BIDDER CAN ONLY BE DEBARRED OR SUSPENDED FROM COMPETING FOR GOVERNMENT
CONTRACTS THROUGH THE PROCEDURES SET FORTH IN DAR SEC. 1-600, ET SEQ
(1976 ED.). SEE OPALACK & COMPANY, 58 COMP.GEN. 728 (1979), 79-2 CPD
112; MASHBURN ELECTRIC COMPANY, INC., ET AL., B-189471, APRIL 10, 1978,
78-1 CPD 277. IT IS IMPROPER FOR A PROCURING AGENCY TO SUBJECT A BIDDER
TO A DE FACTO DEBARMENT THAT AVOIDS THOSE PROCEDURES BY REPEATED
DETERMINATIONS OF NONRESPONSIBILITY, OR EVEN A SINGLE NEGATIVE
DETERMINATION IF IT IS A PART OF A LONG TERM DISQUALIFICATION ATTEMPT.
HOWARD ELECTRICAL COMPANY, 58 COMP.GEN. 303, 304, (1979), 79-1 CPD 137;
KAHN'S BAKERY INC., B-185025, AUGUST 2, 1976, 76-2 CPD 106; 43 COMP.
GEN. SUPRA, AT 141-42. HOWEVER, THIS IS NOT A CASE OF DE FACTO
DEBARMENT BECAUSE DISC HAS NOT EXCLUDED UATC FROM CONTRACTING WITH IT OR
ANY OTHER GOVERNMENT AGENCY. MACRO SYSTEMS, INC.; RICHARD KATON &
ASSOCIATES, INC., B-195990, AUGUST 19, 1980, 80-2 CPD 133, P. 10. SEE
COMPUTER DATA SYSTEMS, INC. - RECONSIDERATION, 61 COMP.GEN. 545, 550,
(1982), 82-2 CPD 75; FERMONT DIVISION, DYNAMICS CORPORATION OF AMERICA,
B-199159, JULY 15, 1981, 81-2 CPD 34, P. 5. IN FACT, DOCUMENTS
FURNISHED BY DISC CLEARLY DEMONSTRATE THAT DISC HAS ACTIVELY SOLICITED
UATC'S QUOTATIONS AND, AS OF MARCH 31, 1983, UATC HAD OPEN (ORDERED, BUT
NOT YET SHIPPED) PURCHASE ORDERS WHICH TOTAL $119,337.67. THE ONLY
THING THAT UATC HAS BEEN DENIED IN THIS CASE IS AN OPPORTUNITY TO
PERFORM A PARTICULAR CONTRACT. SEE MYERS & MYERS, INC., 527 F 2D 1252,
1258, (2ND CIR. 1975); J.P. MASCARO & SONS, INC. V. TOWNSHIP OF
BRISTOLE, 497 F.SUPP. 625, 628, (E.D. PENN. 1980); HOWARD ELECTRIC
COMPANY, SUPRA, AT 304. CF. RELATED INDUSTRIES, INC., SUPRA, AT 18, IN
WHICH THE CONTRACTING OFFICER STATED HIS INTENTION TO NOT ONLY DENY THE
PARTICULAR CONTRACT TO RELATED, BUT TO DENY CONTRACTS TO RELATED ON A
CONTINUING BASIS.
NEGATIVE RESPONSIBILITY DETERMINATION
PROCURING AGENCIES ARE GENERALLY REQUIRED TO REFER DETERMINATIONS
THAT A SMALL BUSINESS IS NONRESPONSIBLE TO THE SBA. OUR OFFICE HAS HELD
THAT AN AGENCY MAY NOT AVOID THIS REQUIREMENT ON THE BASIS OF EITHER
"URGENCY" OR DAR SEC. 1-705.4(C) (DEFENSE ACQUISITION CIRCULAR 76-24,
AUGUST 28, 1980), WHICH PROVIDES THAT REFERRAL SHALL NOT BE MADE WHERE,
AS HERE, SMALL PURCHASE PROCEDURES ARE USED. SEE METAL SERVICES CENTER,
62 COMP.GEN. 134, 137-38, (1983), 83-1 CPD 58; Z.A.N. CO., 59 COMP.GEN.
637 (1980), 80-2 CPD 94. HOWEVER, RECENTLY ENACTED SBA REGULATION 13
C.F.R. SEC. 125.5(D) (1983) PROVIDES THAT IT IS WITHIN THE CONTRACTING
OFFICER'S DISCRETION TO DETERMINE WHETHER A NEGATIVE DETERMINATION
INVOLVING A CONTRACT VALUED AT LESS THAN $10,000 SHOULD BE REFERRED TO
THE SBA. SEE AMCO TOOL & DIE CO., 62 COMP.GEN. 213 (1983), 83-1 CPD
246. WE DO NOT FIND, GIVEN THE URGENCY FN1 AND $130.80 TO $144 VALUE OF
THIS PROCUREMENT, THAT THE CONTRACTING OFFICER ABUSED THIS DISCRETION.
WHERE, AS HERE, THE CONTRACTING OFFICER DOES NOT REFER, PURSUANT TO
HIS DISCRETIONARY AUTHORITY UNDER 13 C.F.R. SEC. 125.5, A NEGATIVE
DETERMINATION OF NONRESPONSIBILITY TO THE SBA, OUR OFFICE WILL REVIEW
THE NEGATIVE DETERMINATION. HOWEVER, WE WILL NOT QUESTION IT UNLESS THE
PROTESTER CAN DEMONSTRATE BAD FAITH BY THE PROCURING AGENCY OR A LACK OF
ANY REASONABLE BASIS. AMCO TOOL & DIE CO., SUPRA; SEE AMITY PRECISION
SPRINGS CO., INC., B-210949, 210949.2, JULY 27, 1983, 83-2 CPD 133.
UATC CONTENDS THAT ITS QUOTATION WAS REJECTED BECAUSE IT FAILED TO
QUALIFY AS A REGULAR DEALER UNDER THE WALSH-HEALEY ACT. 41 U.S.C. SEC.
35 (1976). WE DISAGREE. THE INTER-OFFICE MEMORANDUM ADVISED CONTRACTING
OFFICERS TO EVALUATE UATC QUOTATIONS NOT COVERED BY THE WALSH-HEALEY ACT
ON THE BASIS OF THE CONDITIONS NOTED IN THE FIRST PARAGRAPH, NAMELY,
UATC (1) HAD BEEN IN BUSINESS 1 MONTH; (2) DOES NOT HAVE WAREHOUSE
FACILITIES; AND (3) DOES NOT INTEND TO CARRY OUT BUSINESS WITH
COMMERCIAL CUSTOMERS. THESE STATEMENTS (THE ACCURACY OF WHICH UATC DOES
NOT CONTEST) REASONABLY RELATE TO UATC'S DEMONSTRATED ABILITY AND
CAPACITY TO PERFORM THE CONTRACT. WE ALSO FIND THAT THEY REASONABLY
SUPPORT DISC'S DETERMINATION THAT UATC WAS NONRESPONSIBLE TO PERFORM
THIS CONTRACT. SEE S.A.F.E. EXPORT CORPORATION, B-209491; B-209492,
AUGUST 2, 1983, 83-2 CPD , IN WHICH WE DENIED A PROTEST INVOLVING A
PREAWARD SURVEY WHICH FOUND THAT THE PROTESTER LACKED ADEQUATE
FACILITIES.
UATC'S FINAL GROUND OF PROTEST IS THAT DISC FAILED TO CONDUCT A
PREAWARD SURVEY. A PREAWARD SURVEY IS AN EVALUATION BY A CONTRACT
ADMINISTRATION OFFICE OF A PROSPECTIVE CONTRACTOR'S CAPACITY TO PERFORM
UNDER THE TERMS OF A PROPOSED CONTRACT, DAR SEC. 1-905.4 (DEFENSE
ACQUISITION CIRCULAR 76-42, FEBRUARY 28, 1983), AND IS USED TO DETERMINE
RESPONSIBILITY. HOWEVER, THERE IS NO REQUIREMENT THAT A PREAWARD SURVEY
BE CONDUCTED IN ALL CASES. PARAMATIC FILTER CORPORATION, B-210138,
FEBRUARY 24, 1983, 83-1 CPD 187. FOR EXAMPLE, A PREAWARD SURVEY NEED NOT
BE CONDUCTED WHERE, AS HERE, THE INFORMATION AVAILABLE TO THE PURCHASING
OFFICE (THE MEMORANDUM IN UATC'S VENDOR FILE) WAS SUFFICIENT TO ENABLE
THE CONTRACTING OFFICER TO MAKE A RESPONSIBILITY DETERMINATION. DAR
SEC. 1-905.4(B); HOPPER HOLMES, INC., B-209193.2, DECEMBER 22, 1982,
82-2 CPD 568; STRUTHERS ELECTRONICS CORPORATION, B-182967, MAY 23,
1975, 75-1 CPD 309. MOREOVER, DAR SEC. 1-705.4(C) PROVIDES THAT A
PREAWARD SURVEY NEED NOT BE CONDUCTED WHERE SMALL PURCHASE PROCEDURES
ARE USED.
THE PROTEST IS DENIED.
FN1 ALTHOUGH "URGENCY" IS IRRELEVANT WHERE THE CONTRACT VALUE IS NOT
LESS THAN $10,000 AND REFERRAL IS NONDISCRETIONARY, METAL SERVICES
CENTER, SUPRA, WE CONSIDER IT A RELEVANT FACTOR IN DETERMINING WHETHER A
NONRESPONSIBILITY DETERMINATION INVOLVING A CONTRACT VALUED LESS THAN
$10,000 SHOULD BE REFERRED TO THE SBA.
B-210709.2, NOV 18, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PRIOR DECISION HOLDING THAT AN AGENCY
COULD PROPERLY EXCLUDE PROTESTER'S
EXCESSIVELY PRICED PROPOSAL FROM THE
COMPETITIVE RANGE WITHOUT FURTHER DISCUSSIONS
IS AFFIRMED WHERE RECORD SHOWS THAT
ALL OFFERORS WERE AFFORDED AN OPPORTUNITY
TO REVISE THEIR COST PROPOSALS AND
PROTESTER'S COSTS REMAINED EXCESSIVE.
INFORMATICS GENERAL CORPORATION - REQUEST FOR RECONSIDERATION:
INFORMATICS GENERAL CORPORATION REQUESTS RECONSIDERATION OF OUR
DECISION IN INFORMATICS GENERAL CORPORATION, B-210709, JUNE 30, 1983,
83-2 CPD 47. IN THAT DECISION, WE DENIED INFORMATICS' PROTEST OF THE
EXCLUSION OF ITS PROPOSAL FROM THE COMPETITIVE RANGE UNDER REQUEST FOR
PROPOSALS (RFP) NO. DT0S59-81-R-00144, ISSUED BY THE DEPARTMENT OF
TRANSPORTATION FOR TELEPROCESSING SERVICES. THE PRIOR DECISION IS
AFFIRMED.
THE PROPOSAL WAS FOUND TO BE TECHNICALLY ACCEPTABLE BUT SO FAR OUT OF
LINE WITH OTHER OFFERS WITH RESPECT TO PRICE THAT IT WAS REJECTED
WITHOUT NEGOTIATIONS. AMONG OTHER THINGS, INFORMATICS, THE INCUMBENT
CONTRACTOR, CONTENDED THAT THE AWARDEE, BOEING COMPUTER SERVICE COMPANY
(BCS), HAD BEEN PERMITTED TO MODIFY ITS PROPOSAL PRIOR TO THE
DETERMINATION OF THE COMPETITIVE RANGE. WHILE THE AGENCY CONCEDED THAT
ALL OFFERORS WERE ASKED FOR CLARIFICATION OF THEIR PRICE PROPOSALS PRIOR
TO THE COMPETITIVE RANGE DETERMINATION, IT DENIED THAT ANY OFFER WAS
CHANGED OR DETERMINED TO BE UNACCEPTABLE AS A RESULT OF THESE
CLARIFICATIONS. WE STATED THAT AN AFFIDAVIT SUBMITTED BY INFORMATICS
WHICH CONTAINED INFORMATION TO WHICH INFORMATICS WAS NOT PRIVY DID NOT
PROVIDE SUFFICIENT GROUNDS TO DOUBT THE AGENCY'S DENIAL.
INFORMATICS NOW CONTENDS THAT THIS ISSUE WAS NOT ADEQUATELY
CONSIDERED IN OUR INITIAL DECISION AND ITS REQUEST FOR RECONSIDERATION
ASKS THAT WE REVIEW THE AGENCY'S EVALUATION RECORD TO DETERMINE THE
VALIDITY OF ITS ALLEGATION THAT DISCUSSIONS WERE HELD WITH BCS PRIOR TO
THE DETERMINATION OF COMPETITIVE RANGE.
WE HAVE THEREFORE REVIEWED THE COST EVALUATION RECORD AS IT PERTAINS
TO THE BCS PRICE PROPOSAL. THIS RECORD INDICATES THAT, IN ACCORDANCE
WITH THE PROCEDURES SET OUT IN THE SOLICITATION, THE AGENCY FIRST
REVIEWED THE PRICE PROPOSALS FOR COMPLETENESS AND ACCURACY AND TO
DETERMINE WHICH AREAS IN THESE PROPOSALS NEEDED CLARIFICATION OR
VERIFICATION. THE AGENCY THEN SENT LETTERS TO ALL OFFERORS, INCLUDING
BCS AND INFORMATICS, STATING THAT THEIR PRICE PROPOSALS HAD BEEN
EVALUATED BUT THAT BEFORE THE FINAL ANALYSIS COULD BE MADE, THE OFFERORS
MUST ADDRESS THE AREA SPECIFIED IN THE DOCUMENTS ATTACHED TO EACH
LETTER. THE LETTERS FURTHER STATED THAT THE FAILURE TO ADDRESS THESE
AREAS COULD RESULT IN THE OFFEROR'S PROPOSAL BEING REMOVED FROM FURTHER
CONSIDERATION AND THAT "ANY REVISIONS OR AMENDMENTS" MUST BE RECEIVED BY
THE AGENCY NOT LATER THAN NOVEMBER 19, 1982.
THE ENCLOSURE ATTACHED TO THE LETTER SENT TO INFORMATICS IDENTIFIED
TWO COST TABLES WHICH THE AGENCY BELIEVED CONTAINED ARITHMETIC ERRORS.
INFORMATICS CORRECTED ONE OF THEM AND STATED THAT THE OTHER WAS CORRECT
AS INITIALLY SUBMITTED.
THE ENCLOSURE TO THE LETTER TO BCS IDENTIFIED FOUR COST TABLES IN
WHICH THE CONTRACTING OFFICER FOUND OR SUSPECTED ERRORS. FOR EXAMPLE,
BCS'S PROPOSAL IN ONE OF THE COST TABLES SHOWED NO CHARGE FOR REMOTE JOB
PRINTING AT THE CONTRACTOR'S SITE, WHICH INDICATED TO THE AGENCY THAT
BCS HAD ASSUMED ERRONEOUSLY THAT THE PRINTING WOULD BE PERFORMED IN THE
AGENCY'S FACILITIES. ANOTHER AREA OF CONCERN WAS THE PRICING OF
DESIRABLE SOFTWARE ON A UNIT BASIS RATHER THAN ON THE REQUIRED ANNUAL
BASIS. ALSO, IN RESPONSE TO THE AGENCY'S EXPRESSED CONCERNS, BCS
CORRECTED ITS COST TABLES TO REFLECT THE OVERNIGHT RATES FOR DEFERRED
BATCH PROCESSING RATHER THAN THE LOWER WEEKEND RATES AND IT CALCULATED
THE COST OF DISK STORAGE ON A 365 DAY ANNUAL RATE RATHER THAN THE 360
DAY ANNUAL RATE USED IN IT INITIAL PROPOSAL. AS A RESULT OF THESE PRICE
REVISIONS, THE EVALUATED PRICE OF BCS'S PROPOSAL WAS INCREASED BY
$940,964.
WE AGREE WITH INFORMATICS THAT DISCUSSIONS WERE HELD WITH BCS BEFORE
THE COMPETITIVE RANGE WAS ESTABLISHED AND INFORMATICS' PROPOSAL WAS
REJECTED. HOWEVER, WE DO NOT AGREE THAT INFORMATICS SHOULD HAVE BEEN
ALLOWED TO SUBMIT A BEST AND FINAL PROPOSAL AS A RESULT.
DISCUSSIONS OCCUR WHEN AN OFFEROR IS GIVEN AN OPPORTUNITY TO REVISE
OR MODIFY ITS PROPOSAL OR WHEN THE INFORMATION PROVIDED IS ESSENTIAL FOR
DETERMINING THE ACCEPTABILITY OF THE PROPOSAL. SEE ALCHEMY, INC.,
B-207338, JUNE 8, 1983, 83-1 CPD 621. HERE, PRECOMPETITIVE RANGE
DISCUSSIONS WERE CONDUCTED WITH ALL OFFERORS, INCLUDING INFORMATICS, AND
ALL WERE GIVEN THE OPPORTUNITY TO MODIFY THEIR COST TABLES. AFTER THESE
DISCUSSIONS, THE AGENCY DETERMINED THAT INFORMATICS' PROPOSAL NO LONGER
HAD A REASONABLE CHANGE FOR AWARD BECAUSE OF ITS EXCESSIVE PRICE. WE
FIND NOTHING UNFAIR IN THIS PROCESS; NOR DO WE FIND THAT THE AGENCY HAD
ANY OBLIGATION TO ENTER INTO FURTHER DISCUSSIONS WITH INFORMATICS MERELY
BECAUSE BCS'S PRICE REVISIONS WERE MORE EXTENSIVE THAN THOSE MADE BY
INFORMATICS.
OUR INITIAL DECISION IS AFFIRMED.
B-210709, JUN 30, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTESTER'S CONTENTION THAT THE AGENCY ERRED IN EXCLUDING ITS
TECHNICALLY ACCEPTABLE PROPOSAL FROM THE COMPETITIVE RANGE WITHOUT
DISCUSSIONS IS DENIED, SINCE THE RECORD SHOWS THAT THE AGENCY HAD A
REASONABLE BASIS FOR ITS BELIEF THAT THE PROTESTER'S INITIAL PRICE,
WHICH WAS 44 PERCENT HIGHER THAN THE PRICE OF THE LOW TECHNICALLY
ACCEPTABLE PROPOSAL, WAS SO FAR OUT OF LINE WITH THE PRICES OF THE OTHER
PROPOSALS THAT THE PROTESTER'S PROPOSAL DID NOT HAVE A REASONABLE CHANCE
OF BEING SELECTED FOR AWARD.
INFORMATICS GENERAL CORPORATION:
INFORMATICS GENERAL CORPORATION PROTESTS THE EXCLUSION FROM THE
COMPETITIVE RANGE OF ITS PROPOSAL SUBMITTED IN RESPONSE TO REQUEST FOR
PROPOSALS (RFP) NO. DT0559-81-R-00144, WHICH WAS ISSUED BY THE
DEPARTMENT OF TRANSPORTATION FOR TELEPROCESSING SERVICES. THE PROPOSAL
WAS FOUND TO BE TECHNICALLY ACCEPTABLE BUT SO FAR OUT OF LINE WITH THE
OTHER OFFERS WITH RESPECT TO PRICE THAT IT WAS REJECTED WITHOUT
NEGOTIATIONS. INFORMATICS, THE INCUMBENT CONTRACTOR, CONTENDS THAT
UNDER THE WORDING OF THE RFP THE AGENCY WAS REQUIRED TO CONDUCT PRICE
NEGOTIATIONS WITH ALL OFFERORS WITH TECHNICALLY ACCEPTABLE PROPOSALS
UNLESS THE AGENCY MADE AWARD BASED ON THE INITIAL PROPOSALS.
THE PROTEST IS DENIED.
THERE IS NO DISPUTE AS TO THE TECHNICAL ACCEPTABILITY OF INFORMATICS'
PROPOSAL AND ITS SUCCESSFUL BENCHMARK VERIFICATION. THE PRIMARY ISSUE IS
WHETHER THE AGENCY PROPERLY EXCLUDED INFORMATICS' PROPOSAL FROM THE
COMPETITIVE RANGE WITHOUT DISCUSSIONS SOLELY BECAUSE ITS COST PROPOSAL,
WHICH WAS SUBMITTED AFTER THE BENCHMARK TEST, WAS DETERMINED TO BE SO
FAR OUT OF LINE WITH RESPECT TO PRICE AS TO RENDER DISCUSSIONS USELESS.
THE RFP ADVISED OFFERORS TO SUBMIT THEIR INITIAL PROPOSALS ON THE
MOST FAVORABLE TERMS AND CONDITIONS BECAUSE AWARD MIGHT BE MADE ON THE
BASIS OF SUCH PROPOSALS WITHOUT DISCUSSIONS. THE SOLICITATION STATED
THAT THOSE OFFERORS WHOSE PROPOSALS MET ALL MANDATORY REQUIREMENTS AND
WHOSE EQUIPMENT PASSED THE BENCHMARK VERIFICATION TESTS WOULD BE GIVEN
THE OPPORTUNITY TO DISCUSS WITH THE CONTRACTING OFFICER ANY OUTSTANDING
QUESTIONS REGARDING THEIR PROPOSALS. ANOTHER RFP PROVISION STATED THAT
THE AGENCY INTENDED TO ASSURE MAXIMUM COMPETITION AND THAT EACH OFFEROR
WOULD HAVE ADEQUATE TIME TO SUBMIT ITS PROPOSAL, COMPLETE THE BENCHMARK,
FURNISH ADDITIONAL NECESSARY INFORMATION AND SUBMIT A BEST AND FINAL
OFFER. THE EVALUATION PROVISION SET OUT A SEQUENCE OF PROCUREMENT
EVENTS, ONE OF WHICH STATED THAT OFFERORS "MAY" BE GIVEN AN OPPORTUNITY
TO SUBMIT BEST AND FINAL OFFERS. DURING A PREPROPOSAL CONFERENCE,
OFFERORS WERE INFORMED THAT BEST AND FINAL OFFERS WOULD NOT NECESSARILY
BE REQUESTED FROM ALL TECHNICALLY QUALIFIED VENDORS, DEPENDING ON THE
EVALUATIONS.
INFORMATICS CONTENDS THAT UNDER THE TERMS OF THE RFP, THE AGENCY,
UNLESS IT COULD MAKE AWARD BASED ON THE INITIAL PROPOSALS, WAS OBLIGATED
TO NEGOTIATE WITH IT BECAUSE ITS PROPOSAL WAS TECHNICALLY ACCEPTABLE.
INFORMATICS ARGUES THAT, IN ANY EVENT, A PROPOSAL CANNOT BE EXCLUDED
FROM THE COMPETITIVE RANGE UNLESS IT IS SO TECHNICALLY INFERIOR OR OUT
OF LINE AS TO PRICE AS TO MAKE DISCUSSIONS MEANINGLESS, WHICH
INFORMATICS DENIES WAS THE CASE HERE. IN THIS RESPECT, INFORMATICS
COMPLAINS THAT THE AGENCY IGNORED A LETTER THE FIRM SENT BEFORE THE
COMPETITIVE RANGE DETERMINATION STATING IT WAS PREPARED TO LOWER ITS
PRICE; THE PROTESTER SUGGESTS THAT BECAUSE OF THE COMPETITIVE AND
TECHNICALLY DYNAMIC ENVIRONMENT IN THIS INDUSTRY, THE AGENCY SHOULD HAVE
EXPECTED THAT SUBSTANTIAL PRICE REDUCTIONS COULD HAVE BEEN MADE,
ESPECIALLY IN VIEW OF THE 5 MONTHS THAT ELAPSED BETWEEN THE SUBMISSION
OF THE COST PROPOSALS AND THE COMPETITIVE RANGE DETERMINATION.
GENERALLY, DISCUSSIONS IN NEGOTIATED PROCUREMENTS NEED BE HELD ONLY
WITH THOSE OFFERORS WHOSE PROPOSALS ARE DETERMINED TO BE WITHIN THE
COMPETITIVE RANGE, THAT IS, WHOSE PROPOSALS HAVE A REASONABLE CHANCE OF
BEING SELECTED FOR AWARD. PETER J. T. NELSEN, B-194728, OCTOBER 29,
1979, 79-2 CPD 302. A CONTRACTING OFFICER NECESSARILY HAS A
CONSIDERABLE RANGE OF DISCRETION IN MAKING A COMPETITIVE RANGE
DETERMINATION, AND WE THEREFORE WILL NOT QUESTION SUCH A DETERMINATION
UNLESS IT IS WITHOUT A REASONABLE BASIS. EVEN A TECHNICALLY ACCEPTABLE
PROPOSAL MAY BE DETERMINED TO BE OUTSIDE OF THE COMPETITIVE RANGE IF
THERE IS NO REASONABLE CHANCE THAT IT WILL BE SELECTED FOR AWARD. SEE
DOCUMENTATION ASSOCIATES, B-190238, MARCH 23, 1978, 78-1 CPD 228, WHERE
THE AGENCY, PURPORTEDLY TO MAXIMIZE COMPETITION, INCLUDED A TECHNICALLY
ACCEPTABLE PROPOSAL IN THE COMPETITIVE RANGE EVEN THOUGH THE AGENCY
CONSIDERED THE PROPOSED COST SO HIGH THAT THE FIRM ALMOST CERTAINLY
WOULD NOT HAVE BEEN AWARDED THE CONTRACT; WE STATED THAT WE COULD NOT
UNDERSTAND HOW COMPETITION WAS ENHANCED BY INCLUDING SUCH A PROPOSAL
WITHIN THE COMPETITIVE RANGE.
THESE GENERAL PRINCIPLES ARE SO WELL ESTABLISHED THAT ANY INTENTION
OF AN AGENCY TO WAIVE THE RIGHT, FOR EXAMPLE, TO EXCLUDE A TECHNICALLY
ACCEPTABLE BUT OTHERWISE NONCOMPETITIVE OFFER FROM THE COMPETITIVE
RANGE, SHOULD NOT BE DRAWN THROUGH INFERENCE OR INTERPRETATION OF
SELECTED SOLICITATION TERMS AND CONDITIONS. SEE INTERNATIONAL AUTOMATED
SYSTEMS, INC., B-205278, FEBRUARY 8, 1982, 82-1 CPD 110. HERE, THE
SOLICITATION PROVISIONS THAT EXPRESS THE AGENCY'S INTENT TO MAXIMIZE
COMPETITION AND TO GIVE OFFERORS THE OPPORTUNITY TO SUBMIT BEST AND
FINAL OFFERS MUST BE READ IN A MANNER CONSISTENT WITH THOSE PROVISIONS
STATING THAT OFFERORS "MAY" BE GIVEN THE OPPORTUNITY TO SUBMIT SUCH
OFFERS AND THE EXPLANATION AT THE PREPROPOSAL CONFERENCE THAT ALL
OFFERORS WITH TECHNICALLY ACCEPTABLE PROPOSALS WOULD NOT NECESSARILY BE
GIVEN THE CHANCE TO SUBMIT BEST AND FINAL OFFERS. INFORMATICS' POSITION
REQUIRES THAT THE WORD "MAY" BE INTERPRETED AS "SHALL" AND THAT THE
PREPROPOSAL EXPLANATION BE IGNORED. WE THINK THAT THE RFP AS A WHOLE
CLEARLY INDICATES NO INTENTION BY THE AGENCY TO WAIVE ITS ESTABLISHED
RIGHT TO EXCLUDE TECHNICALLY ACCEPTABLE PROPOSALS WHOSE PRICES INDICATE
THAT IT WOULD BE HIGHLY UNLIKELY THAT THEY COULD BE SELECTED FOR AWARD.
WE BELIEVE THAT THE REJECTION OF INFORMATICS' PROPOSAL WAS MADE IN
ACCORDANCE WITH THE ONLY REASONABLE INTERPRETATION OF SOLICITATION.
INFORMATICS FURTHER CONTENDS THAT, IN ANY EVENT, THERE WAS NO
REASONABLE BASIS FOR EXCLUDING ITS PROPOSAL FROM THE COMPETITIVE RANGE.
WE FIND, HOWEVER, THAT THE CONTRACTING OFFICER HAD A REASONABLE BASIS
FOR EXCLUDING INFORMATICS' PROPOSAL ON THE BASIS OF ITS EXCESSIVE PRICE.
INFORMATICS' PRICE WAS 44 PERCENT HIGHER THAN THE LOWEST OFFEROR; TWO
OTHER PROPOSALS WITH PRICES 26 PERCENT AND 37 PERCENT HIGHER THAN THE
LOW OFFEROR ALSO WERE ELIMINATED FROM THE COMPETITIVE RANGE. THE
PROPOSED PRICES OF THOSE INCLUDED WERE ONLY 14 PERCENT TO 16 PERCENT
HIGHER THAN THE PRICE OF THE LOW OFFEROR. IT MAY BE, AS INFORMATICS'
LETTER TO THE AGENCY STATED, THAT IT WAS READY TO REDUCE ITS PRICE
SUBSTANTIALLY BUT, AT THE TIME OF THE COMPETITIVE RANGE DETER-MINATION,
THE AGENCY HAD NO REASON TO BELIEVE THAT INFORMATICS COULD MAKE A
SUFFICIENT REDUCTION TO HAVE A REASONABLE CHANCE AT THE AWARD. RKFM
PRODUCT CORPORATION, B-186424, SEPTEMBER 15, 1976, 76-2 CPD 247. IN
THIS RESPECT, INITIAL COMPETITIVE RANGE DETERMINATIONS ARE MADE BASED ON
THE INITIAL PROPOSALS, SO THAT A FIRM THAT DOES NOT SUBMIT ITS BEST
PRICE AT THE FIRST OPPORTUNITY ALWAYS RUNS THE RISK OF BEING EXCLUDED
FROM FURTHER COMPETITION FOR THE AWARD. SEE UNITED COMPUTING SYSTEMS,
INC., B-204045, SEPTEMBER 23, 1981, 81-2 CPD 247.
INFORMATICS ALSO COMPLAINS THAT THE PROPOSED AWARDEE WAS PERMITTED TO
MODIFY ITS PROPOSAL PRIOR TO THE DETERMINATION OF THE COMPETITIVE RANGE.
INFORMATICS HAS SUBMITTED AN AFFIDAVIT OF ITS DIRECTOR OF MARKETING
STATING THAT A FORMER EMPLOYEE OF THE DEPARTMENT OF TRANSPORTATION HAD
INFORMED HIM THAT THE PROPOSED AWARDEE WAS PERMITTED TO MODIFY ITS
UNBALANCED PRICING BEFORE THE COMPETITIVE RANGE WAS ESTABLISHED.
INFORMATICS SUGGESTS THAT OUR OFFICE OBTAIN THE PROPOSAL AWARDEE'S
INITIAL COST PROPOSAL, ALL SUBSEQUENT AMENDMENTS TO IT, AND RELATED
CORRESPONDENCE, IN ORDER TO DETERMINE WHETHER THESE CONTACTS CONSTITUTED
DISCUSSIONS. INFORMATICS CORRECTLY ARGUES THAT IF DISCUSSIONS WERE
CONDUCTED WITH THE PROPOSED AWARDEE, THEY SHOULD HAVE BEEN CONDUCTED
WITH ALL OFFERORS WHOSE PROPOSALS WERE WITHIN THE COMPETITIVE RANGE.
THE AGENCY, HOWEVER, DENIES THAT THE AFFIDAVIT HAS ANY FACTUAL BASIS
AND ASSERTS THAT NONE OF THE TECHNICALLY ACCEPTABLE PROPOSALS WAS
UNBALANCED AS TO PRICE, AND THAT NO OFFEROR WAS PERMITTED TO REVISE ITS
PROPOSAL BETWEEN THE TIME THE COST PROPOSALS WERE RECEIVED AND THE
DETERMINATION OF THE COMPETITIVE RANGE. THE AGENCY SUSPECTS THAT THE
ALLEGATION MIGHT HAVE RESULTED FROM THE CONTRACTING OFFICER'S REQUESTS
OF (WORD OMITTED) TO CLARIFY AND VERIFY THE COST PROPOSALS, WHICH HE WAS
ENTITLED TO DO UNDER THE TERMS OF THE SOLICITATION. THE DEPARTMENT OF
TRANSPORTATION POINTS OUT THAT AS NO AWARD HAS BEEN MADE AND SOME OF THE
INFORMATION IS PROPRIETARY, IT WOULD BE INAPPROPRIATE TO DISCLOSE IT TO
INFORMATICS OR THE PUBLIC AT THIS TIME BUT THAT THE AGENCY WOULD PROVIDE
THE MATERIAL FOR OUR IN CAMERA REVIEW IF WE DEEMED THIS TO BE NECESSARY.
THE QUESTION AS TO WHAT CONSTITUTES DISCUSSIONS IN NEGOTIATED
PROCUREMENTS DEPENDS ON WHETHER AN OFFEROR HAS BEEN AFFORDED AN
OPPORTUNITY TO REVISE OR MODIFY ITS PROPOSAL, REGARDLESS OF WHETHER THIS
OPPORTUNITY RESULTED FROM ACTIONS INITIATED BY THE OFFEROR OR THE
AGENCY. 51 COMP.GEN. 479, 481 (1972). DISCUSSIONS ALSO OCCUR WHEN THE
INFORMATION REQUESTED AND PROVIDED IS ESSENTIAL FOR DETERMINING THE
ACCEPTABILITY OF A PROPOSAL. JOHN FLUKE MANUFACTURING COMPANY, INC.,
B-195091, NOVEMBER 20, 1979, 79-2 CPD 367.
ACCORDING TO THE DEPARTMENT OF TRANSPORTATION, THE PROPOSED AWARDEE
WAS NOT GIVEN AN OPPORTUNITY TO REVISE ITS PROPOSAL PRIOR TO THE
DETERMINATION OF THE COMPETITIVE RANGE, AND THE INFORMATION REQUESTED
WAS NOT ESSENTIAL FOR THE DETERMINATION OF THE ACCEPTABILITY OF ITS
PROPOSAL. THE AGENCY STATES THAT WHEN ITS COST ANALYSIS REVEALED ANY
UNKNOWN FACTOR WHICH COULD IMPACT FUTURE COSTS, CLARIFICATION WAS
REQUESTED. IF THE CLARIFICATION MADE IT CLEAR THAT THE PROPOSAL AS
SUBMITTED COMPLIED WITH ALL REQUIREMENTS, THE PROPOSED COSTS WERE
ACCEPTED. IF THE CLARIFICATION WAS INSUFFICIENT, THE AGENCY ASSESSED
THE COST ASSOCIATED WITH FULL COMPLIANCE WITH RFP REQUIREMENTS AS PART
OF THE COST EVALUATION. IN FACT, THE AGENCY FOLLOWED THIS PROCEDURE IN
SEEKING CLARIFICATION OF INFORMATICS' PRICE PROPOSAL, AND THE FIRM WAS
PERMITTED TO CORRECT SEVERAL ERRORS IN THE UNIT PRICES IN ITS PRICE
TABLES. THE EVALUATED COSTS OF WHICH EACH OFFEROR WAS INFORMED WERE
USED TO DETERMINE THE COMPETITIVE RANGE AND THE AGENCY IS ADAMANT THAT
NO OFFEROR WAS PERMITTED PRIOR TO THAT TIME TO CHANGE THE EVALUATED
COSTS OR TO CHANGE ITS PROPOSAL.
WE DO NOT BELIEVE THAT THE AFFIDAVIT, WHICH CONTAINS INFORMATION TO
WHICH INFORMATICS ADMITTEDLY WAS NOT PRIVY, PROVIDES SUFFICIENT GROUNDS
TO DOUBT THE AGENCY'S UNQUALIFIED DENIAL THAT ANY OFFEROR WAS PERMITTED
TO REVISE ITS PROPOSAL PRIOR TO THE COMPETITIVE RANGE DETERMINATION, AND
THE AGENCY'S CONTENTION THAT THE INQUIRIES WERE FOR CLARIFICATION
PURPOSES ONLY. AS THE PROTESTER, INFORMATICS BEARS THE BURDEN OF
PROVING ITS CASE, AND THAT BURDEN IS NOT MET WHERE THE ONLY EVIDENCE IS
CONFLICTING STATEMENTS BY THE PROTESTER AND THE AGENCY. ALCHEMY, INC.,
B-207954, JANUARY 10, 1983, 83-1 CPD 18.
FINALLY, INFORMATICS CONTENDS THAT THE EXCLUSION OF ITS PROPOSAL WAS
CAUSED BY THE AGENCY'S ERRONEOUS UNDERSTANDING AS TO THE PERMISSIBLE
SCOPE OF NEGOTIATIONS, AND THAT DOT COULD HAVE NEGOTIATED A PRICE
DECREASE WITH INFORMATICS.
WHILE SUCH A DECREASE COULD HAVE BEEN NEGOTIATED IF DISCUSSIONS WERE
CONDUCTED, THE AGENCY CLEARLY WAS TRYING TO AVOID DISCUSSIONS WHILE
SEEKING PRICE CLARIFICATIONS PRIOR TO ITS COMPETITIVE RANGE
DETERMINATION. IN SUCH CASES, THE CONSTRAINTS UPON AN AGENCY ARE MUCH
GREATER THAN WHEN DISCUSSIONS ARE ACTUALLY CONDUCTED, SINCE
CLARIFICATIONS THAT RESULT IN MATERIAL CHANGES TO AN OFFEROR'S PROPOSAL
WOULD CONSTITUTE DISCUSSIONS. SEE NEW HAMPSHIRE-VERMONT HEALTH SERVICE,
57 COMP.GEN. 348 (1978), 78-1 CPD 202. AS SHOWN ABOVE, NO OFFER WAS
CHANGED OR DETERMINED TO BE UNACCEPTABLE AS A RESULT OF THESE
CLARIFICATIONS. INFORMATICS' PROPOSAL WAS EXCLUDED SOLELY BECAUSE ITS
INITIAL PRICE, AS CLARIFIED, WAS OUT OF LINE WITH THOSE OF THE OTHER
ACCEPTABLE PROPOSALS. THEREFORE, INFORMATICS' CONTENTION IS WITHOUT
MERIT.
THE PROTEST IS DENIED.
B-210708, FEB 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT REVIEW A CONTRACTING OFFICER'S DETERMINATION THAT A
SMALL BUSINESS IS NOT RESPONSIBLE SINCE THE SMALL BUSINESS
ADMINISTRATION IS AUTHORIZED BY STATUTE TO CERTIFY CONCLUSIVELY WHETHER
SMALL BUSINESS CONCERNS ARE RESPONSIBLE.
GUIDA CLOTHING CO., INC.:
GUIDA CLOTHING CO., INC. PROTESTS AN AWARD TO ANY OTHER FIRM UNDER
INVITATION FOR BIDS NO. DLA100-83-B0195, A SMALL BUSINESS SET-ASIDE FOR
COLD WEATHER TROUSER LINERS, ISSUED BY THE DEFENSE PERSONNEL SUPPORT
CENTER, DEFENSE LOGISTICS AGENCY. THE BASIS OF THE PROTEST IS THE
DECISION BY THE CONTRACTING OFFICER THAT GUIDA, THE LOW BIDDER, IS
NONRESPONSIBLE.
WE WILL NOT CONSIDER THE MATTER.
SINCE GUIDA IS A SMALL BUSINESS, THE CONTRACTING OFFICER HAS REFERRED
THE MATTER TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR ITS REVIEW
UNDER THE CERTIFICATE OF COMPETENCY PROCEDURES. PURSUANT TO THE
PROVISIONS OF THE SMALL BUSINESS ACT, 15 U.S.C. SEC. 637(B)(7) (SUPP.
IV 1980), THE SBA HAS THE AUTHORITY TO CERTIFY CONCLUSIVELY WHETHER
SMALL BUSINESS CONCERNS ARE RESPONSIBLE TO RECEIVE AND PERFORM
GOVERNMENT CONTRACTS. IN VIEW OF THAT SPECIFIC STATUTORY AUTHORIZATION,
OUR OFFICE WILL NOT REVIEW A CONTRACTING OFFICER'S DETERMINATION THAT A
SMALL BUSINESS IS NONRESPONSIBLE. SEE ASPEN REFORESTATION, B-206144,
FEBRUARY 4, 1982, 82-1 CPD 95.
THE PROTEST IS DISMISSED.
B-210705, FEB 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHEN PROTEST IS TIMELY FILED INITIALLY WITH CONTRACTING AGENCY,
SUBSEQUENT PROTEST FILED WITH GAO MORE THAN 10 WORKING DAYS AFTER THE
PROTESTER LEARNS OF INITIAL ADVERSE AGENCY ACTION ON THE PROTEST IS
UNTIMELY.
VANGUARD MANAGEMENT CORPORATION:
VANGUARD MANAGEMENT CORPORATION (VANGUARD) PROTESTS THE GENERAL
SERVICES ADMINISTRATION'S (GSA) AWARD OF A CONTRACT UNDER SOLICITATION
NO. RGA82520 FOR OFFICE SPACE IN MARIETTA, GEORGIA. THE PROTESTER
ASSERTS THAT THE SPACE IT OFFERED IS MORE DESIRABLE THAN THAT OFFERED BY
THE AWARDEE.
THIS PROTEST IS UNTIMELY AND WILL NOT BE CONSIDERED ON THE MERITS.
WE RECEIVED VANGUARD'S PROTEST ON FEBRUARY 3, 1983. THE PROTEST
MATERIAL INDICATES THAT VANGUARD HAD PREVIOUSLY PROTESTED TO GSA AND
THAT GSA DENIED THE PROTEST BY LETTER DATED JANUARY 11. OUR PROCEDURES
REQUIRE THAT WHEN A PROTEST IS INITIALLY TIMELY FILED WITH A CONTRACTING
AGENCY, ANY SUBSEQUENT PROTEST TO THIS OFFICE MUST BE FILED WITHIN 10
DAYS OF THE PROTESTER'S LEARNING OF INITIAL ADVERSE ACTION ON ITS
PROTEST BY THE AGENCY. 4 C.F.R. SEC. 21.2(A) (1982). ALLOWING A
REASONABLE PERIOD OF TIME FOR VANGUARD TO RECEIVE GSA'S JANUARY 11
LETTER, IT APPEARS THAT VANGUARD'S FEBRUARY 3 PROTEST WAS NOT FILED
WITHIN THE 10-DAY PERIOD ALLOWED AND THAT IT IS THEREFORE UNTIMELY.
THE PROTEST IS DISMISSED.
B-210703, FEB 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO WILL NOT UNDERTAKE AN INDEPENDENT REVIEW OF A CONTRACTING
OFFICER'S NONRESPONSIBILITY DETERMINATION OF A SMALL BUSINESS CONCERN
BECAUSE THE SMALL BUSINESS ADMINISTRATION, NOT GAO, HAS STATUTORY
AUTHORITY TO DETERMINE CONCLUSIVELY A SMALL BUSINESS CONCERN'S
RESPONSIBILITY.
2. GAO WILL NOT REVIEW THE SMALL BUSINESS ADMINISTRATION'S DECISION
NOT TO ISSUE A CERTIFICATE OF COMPETENCY WHERE THE PROTESTER FAILS TO
MAKE A PRIMA FACIE SHOWING OF FRAUD OR WILLFUL DISREGARD OF THE FACTS.
COAST CANVAS PRODUCTS II CO., INC.:
COAST CANVAS PRODUCTS II CO., INC. PROTESTS THE CONTRACTING OFFICER'S
NEGATIVE DETERMINATION OF ITS RESPONSIBILITY AND THE SMALL BUSINESS
ADMINISTRATION'S (SBA) REFUSAL TO ISSUE IT A CERTIFICATE OF COMPETENCY
(COC) UNDER DEFENSE LOGISTICS AGENCY SOLICITATION NO. DLA100-83-B-0054.
WE DISMISS THE PROTEST.
THE SBA, NOT THIS OFFICE, HAS STATUTORY AUTHORITY TO REVIEW A
CONTRACTING OFFICER'S NEGATIVE DETERMINATION AND TO DETERMINE
CONCLUSIVELY A SMALL BUSINESS CONCERN'S RESPONSIBILITY BY ISSUING OR
REFUSING TO ISSUE A COC. 15 U.S.C. SEC. 637(B)(7) (SUPP. IV 1980).
CONSEQUENTLY, WE WILL NOT UNDERTAKE AN INDEPENDENT REVIEW OF A
CONTRACTING OFFICER'S NONRESPONSIBILITY DETERMINATION, SINCE SUCH REVIEW
WOULD BE TANTAMOUNT TO A SUBSTITUTION OF OUR JUDGMENT FOR THAT OF THE
SBA. NUMAX ELECTRONICS INCORPORATED, B-204632.2, DECEMBER 10, 1981,
81-2 CPD 457.
MOREOVER, THIS OFFICE DOES NOT REVIEW THE SBA'S DECISION CONCERNING A
COC OR TO REQUIRE THE REOPENING OF A CASE WHERE A COC HAS BEEN DENIED
UNLESS THE PROTESTER MAKES A PRIMA FACIE SHOWING OF FRAUD OR WILLFUL
DISREGARD OF THE FACTS. FRED CRANER, B-207988, JULY 12, 1982, 82-2 CPD
45. THE PROTESTER HAS MADE NO SUCH SHOWING.
THE PROTEST IS DISMISSED.
B-210701, FEB 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST CHALLENGING AN AGENCY'S AFFIRMATIVE DETERMINATION OF
RESPONSIBILITY IS NOT FOR REVIEW BY GAO EXCEPT IN CIRCUMSTANCES NOT
PRESENT HERE.
ALCHEMY, INC.:
ALCHEMY, INC. PROTESTS AN AWARD TO ANOTHER FIRM BY THE DEFENSE
LOGISTICS AGENCY UNDER SOLICITATION NO. DLA700-83-B-0139. ALCHEMY
CONTENDS THAT THE OTHER COMPANY IS NOT CAPABLE OF MEETING CONTRACT
REQUIREMENTS AND THAT IT THEREFORE IS NOT A RESPONSIBLE PROSPECTIVE
CONTRACTOR. WE DISMISS THE PROTEST.
THIS OFFICE DOES NOT REVIEW PROTESTS AGAINST AFFIRMATIVE
DETERMINATIONS OF RESPONSIBILITY, UNLESS FRAUD IS ALLEGED ON THE PART OF
THE CONTRACTING OFFICER OR THE SOLICITATION CONTAINS DEFINITIVE
RESPONSIBILITY CRITERIA WHICH ALLEGEDLY HAVE NOT BEEN APPLIED. SEE
CONNELLY CONTAINERS, INC., B-208259, AUGUST 23, 1982, 82-2 CPD 168.
HERE, THERE IS NO ALLEGATION THAT THE RESPONSIBILITY DETERMINATION WAS
THE RESULT OF FRAUD OR THAT DEFINITIVE CRITERIA HAVE NOT BEEN APPLIED.
B-210699, FEB 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO DOES NOT REVIEW WHETHER AN OFFEROR IS A REGULAR DEALER OR
MANUFACTURER UNDER THE WALSH-HEALEY ACT, SINCE BY LAW THE MATTER IS FOR
THE CONTRACTING AGENCY'S DETERMINATION SUBJECT TO FINAL REVIEW BY THE
SMALL BUSINESS ADMINISTRATION (IF A SMALL BUSINESS IS INVOLVED) AND THE
SECRETARY OF LABOR.
2. GAO DOES NOT CONSIDER A PROTEST OF A BIDDER'S SMALL BUSINESS SIZE
STATUS BECAUSE THE SMALL BUSINESS ADMINISTRATION HAS STATUTORY AUTHORITY
TO DETERMINE CONCLUSIVELY SMALL BUSINESS SIZE STATUS FOR FEDERAL
PROCUREMENTS.
BOGUE ELECTRIC MANUFACTURING CO.:
BOGUE ELECTRIC MANUFACTURING CO. PROTESTS THE ARMY'S AWARD OF A
CONTRACT TO LIBBY WELDING COMPANY UNDER INVITATION FOR BIDS (IFB) NO.
DAAJ09-83-B-A078, WHICH WAS SET ASIDE FOR SMALL BUSINESS CONCERNS. THE
CONTRACT IS TO SUPPLY CERTAIN GENERATORS, AND IS SUBJECT TO THE
WALSH-HEALEY ACT, 41 U.S.C. SECS. 35-45 (1976), WHICH BASICALLY REQUIRES
THAT A FEDERAL AGENCY'S CONTRACT FOR SUPPLIES EXCEEDING $10,000 BE
AWARDED TO A MANUFACTURER OR REGULAR DEALER. BOGUE CONTENDS THAT LIBBY
IS NOT A MANUFACTURER OF THE SUPPLIES AS LIBBY ALLEGEDLY CERTIFIED IN
ITS BID, AND THAT IT IS NOT A SMALL BUSINESS. WE DISMISS THE PROTEST.
OUR OFFICE DOES NOT CONSIDER WHETHER A BIDDER IS A REGULAR DEALER OR
MANUFACTURER WITHIN THE MEANING OF THE WALSH-HEALEY ACT. BY LAW, SUCH
MATTERS ARE FOR DETERMINATION BY THE CONTRACTING AGENCY IN THE FIRST,
INSTANCE, SUBJECT TO FINAL REVIEW BY THE SMALL BUSINESS ADMINISTRATION
(SBA) WHERE A SMALL BUSINESS IS INVOLVED, AND BY THE SECRETARY OF LABOR.
ATTACK INCORPORATED, B-208512, SEPTEMBER 15, 1982, 82-2 CPD 227; SEE
DEFENSE ACQUISITION REGULATION SEC. 12-604 (1976 ED.).
WE ALSO DO NOT CONSIDER PROTESTS CONCERNING A BIDDER'S SIZE STATUS,
BECAUSE THE SBA, NOT THIS OFFICE, HAS STATUTORY AUTHORITY TO DETERMINE
CONCLUSIVELY MATTERS OF SMALL BUSINESS SIZE STATUS FOR FEDERAL
PROCUREMENTS. 15 U.S.C. SEC. 637(B) (SUPP. IV 1980); COMPULASER
INCORPORATED, B-206834, APRIL 12, 1982, 82-1 CPD 336.
THE PROTEST IS DISMISSED.
B-210697, SEP 29, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. EMPLOYEES OF SOCIAL SECURITY
ADMINISTRATION ARE NOT ENTITLED TO OVERTIME COMPENSATION UNDER 5
U.S.C. SEC. 5542(B)(2), FOR TIME SPENT TRAVELING IN AGENCY-HIRED
BUSES FROM ONE DISTRICT OFFICE TO ANOTHER DURING THE NEW YORK CITY
TRANSIT STRIKE OF APRIL 1980 BECAUSE ALL OF THE OFFICES INVOLVED
WERE WITHIN THE EMPLOYEES' OFFICIAL DUTY STATION. MOREOVER, NONE
OF THE CONDITIONS SPECIFIED IN 5 U.S.C. SEC. 5542( B)(2)(B) WERE
SATISFIED.
2. EMPLOYEES OF SOCIAL SECURITY
ADMINISTRATION ARE NOT ENTITLED TO OVERTIME COMPENSATION UNDER THE
FLSA FOR TIME SPENT TRAVELING IN AGENCY-HIRED BUSES FROM ONE
DISTRICT OFFICE TO ANOTHER DURING THE NEW YORK CITY TRANSIT STRIKE
OF APRIL 1980 BECAUSE SUCH TRAVEL WAS HOME TO WORK TRAVEL. THE
DAY'S WORK ENDED BEFORE THE BUSES WERE BOARDED AND IT IS
UNDISPUTED THAT NO WORK AND NO PRELIMINARY OR POSTLIMINARY
ACTIVITIES WERE PERFORMED WHILE TRAVELING OR UPON DEBARKATION FROM
THE BUSES. SEE CASES CITED.
LOCAL 3369, AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO -
CLAIM FOR OVERTIME COMPENSATION - TRAVELTIME:
LOCAL 3369, AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO
(AFGE), HAS REQUESTED A DECISION PURSUANT TO 4 C.F.R. PART 22 (1983),
CONCERNING THE CLAIMS FOR OVERTIME COMPENSATION FOR TIME SPENT BY
EMPLOYEES OF THE SOCIAL SECURITY ADMINISTRATION TRAVELING FROM HOME TO
THEIR WORKSITES DURING THE NEW YORK CITY TRANSIT STRIKE OF APRIL 1980.
THE ACTIVITY WAS SERVED WITH A COPY OF THE UNION'S SUBMISSION AND FILED
NO RESPONSE OR COMMENT. WE HOLD THAT THE TRAVELTIME INVOLVED IS NOT
COMPENSABLE OVERTIME UNDER 5 U.S.C. SEC. 5542(B)(2) OR UNDER THE FAIR
LABOR STANDARDS ACT.
FACTS
THE FACTS AS STATED BY THE UNION ARE AS FOLLOWS. ON APRIL 1, 1980,
THERE WAS A TRANSIT STRIKE IN NEW YORK CITY. THE AGENCY HIRED BUSES TO
TRANSPORT EMPLOYEES TO THEIR WORKSITES. EMPLOYEES WERE INSTRUCTED TO
REPORT TO THE JACKSON HEIGHTS SOCIAL SECURITY DISTRICT OFFICE IN QUEENS
AT 8:30 A.M., THEIR NORMAL STARTING TIME. (EMPLOYEES SUPPLIED THEIR OWN
TRANSPORTATION TO THE JACKSON HEIGHTS OFFICE.) THEY WERE PICKED UP THERE
BY ONE OF THE BUSES HIRED BY THE AGENCY AND TRANSPORTED EITHER TO THE
MIDTOWN SOCIAL SECURITY OFFICE AT 1515 BROADWAY, OR THE DOWNTOWN SOCIAL
SECURITY OFFICE AT 2 WORLD TRADE CENTER. ACCORDING TO THE UNION, FOR
SOME EMPLOYEES THESE OFFICES WERE THEIR NORMAL DUTY LOCATIONS BUT FOR
OTHERS THEY WERE NOT THEIR NORMAL DUTY LOCATIONS. THE UNION STATES THAT
SOME EMPLOYEES WERE REQUIRED TO WORK AT THE PRESELECTED SITES SO THAT
THOSE SITES COULD BE ADEQUATELY STAFFED DURING THE TRANSPORTATION
STRIKE.
AT ABOUT 4 P.M., 1 HOUR BEFORE NORMAL QUITTING TIME, EMPLOYEES WERE
PICKED UP FROM THE MIDTOWN AND DOWNTOWN OFFICES AND TRANSPORTED BACK TO
THE JACKSON HEIGHTS OFFICE. ON APRIL 2, EMPLOYEES AT THE MIDTOWN OFFICE
DID NOT ARRIVE AT THE JACKSON HEIGHTS OFFICE UNTIL 6 P.M; AND ON APRIL
3, THEY DID NOT ARRIVE UNTIL 6:15 P.M.
THE UNION CLAIMS 1 HOUR OF OVERTIME COMPENSATION FOR EMPLOYEES ON
APRIL 2, AND 1-1/4 HOURS OF OVERTIME COMPENSATION FOR EMPLOYEES ON APRIL
3, 1980. IT ARGUES THAT THE EXTRA TRAVELTIME NEEDED TO ARRIVE AT THE
JACKSON HEIGHTS OFFICE EXTENDED THE EMPLOYEES' REGULAR TOUR OF DUTY AND,
THEREFORE, THE EMPLOYEES SHOULD RECEIVE OVERTIME COMPENSATION.
ANALYSIS
IT IS CLEAR FROM THE RECORD IN THIS CASE THAT THE TRAVELTIME AT ISSUE
IS NOT COMPENSABLE AS OVERTIME UNDER TITLE 5 OF THE UNITED STATES CODE.
UNDER 5 U.S.C. SEC. 5542(B)(2)(B), TRAVELTIME OUTSIDE OF THE REGULARLY
SCHEDULED ADMINISTRATIVE WORKWEEK IS COMPENSABLE ONLY IF IT INVOLVES
TRAVEL AWAY FROM THE OFFICIAL DUTY STATION OF EMPLOYEES. THE TRAVEL
INVOLVED IN THIS CASE WAS NOT TRAVEL AWAY FROM THE OFFICIAL DUTY
STATION. ALTHOUGH SOME EMPLOYEES WERE APPARENTLY ASSIGNED TO DIFFERENT
WORKSITES BECAUSE OF THE TRANSIT STRIKE, ALL OF THE WORKSITES INVOLVED
WERE WITHIN THE CORPORATE LIMITS OF NEW YORK CITY AND, THEREFORE, WERE
WITHIN THE EMPLOYEES' OFFICIAL DUTY STATION. DAVIS AND SHERLOCK,
B-198428, AUGUST 7, 1980; FEDERAL TRAVEL REGULATIONS, FPMR 101-7 (MAY
1973), PARA. 1-1.3C(1).
MOREOVER, EVEN IF THE TRAVEL HAD BEEN AWAY FROM THE OFFICIAL DUTY
STATION, THERE WOULD BE NO ENTITLEMENT TO OVERTIME UNDER TITLE 5.
TRAVEL OUTSIDE OF REGULAR DUTY HOURS WHICH HAS NO PURPOSE OTHER THAN TO
TRANSPORT EMPLOYEES TO AND FROM THE PLACE WHERE THEY ARE TO PERFORM
ACTUAL WORK IS NOT COMPENSABLE UNLESS THE TRAVELTIME MEETS ONE OF THE
CONDITIONS SET FORTH IN 5 U.S.C. SEC. 5542(B)(2)(B). THAT IS, IT: "(I)
INVOLVES THE PERFORMANCE OF WORK WHILE TRAVELING, (II) IS INCIDENT TO
TRAVEL THAT INVOLVES THE PERFORMANCE OF WORK WHILE TRAVELING, (III) IS
CARRIED OUT UNDER ARDUOUS CONDITIONS, OR (IV) RESULTS FROM AN EVENT
WHICH COULD NOT BE SCHEDULED OR CONTROLLED ADMINISTRATIVELY."
THE TRAVELTIME AT ISSUE IN THIS CASE DOES NOT MEET ANY OF THOSE
STANDARDS. ALTHOUGH THE TRANSIT STRIKE WAS NOT SUBJECT TO
ADMINISTRATIVE CONTROL, SCHEDULING THE RETURN TRAVEL OF THE BUSES WAS
SUBJECT TO ADMINISTRATIVE CONTROL. 52 COMP.GEN. 446, 449 (1973);
DURWOOD H. NOLIN, B-202049, AUGUST 5, 1981.
SIMILARLY, THE TRAVELTIME CLAIMED IS NOT COMPENSABLE AS OVERTIME
UNDER THE FAIR LABOR STANDARDS ACT (FLSA), 29 U.S.C. SECS. 201-219
(1976). IT IS UNDISPUTED THAT THE DAY'S WORK ENDED AT THE MIDTOWN
OFFICE. ACCORDINGLY, THE TIME OUTSIDE OF THE REGULAR WORKWEEK SPENT
TRAVELING BACK TO THE JACKSON HEIGHTS OFFICE IS NOT COMPENSABLE AS
OVERTIME. WALLING V. MID-CONTINENT PIPE LINE CO., 143 F.2D 308, 311
(10TH CIR. 1944).
TIME SPENT WALKING, RIDING, OR TRAVELING TO OR FROM THE ACTUAL PLACE
OF PERFORMANCE OF THE PRINCIPAL ACTIVITY OR ACTIVITIES WHICH EMPLOYEES
ARE EMPLOYED TO PERFORM DOES NOT GIVE RISE TO AN ENTITLEMENT TO OVERTIME
UNDER THE FLSA. 29 U.S.C. SEC. 254(A)(1). SUCH TRAVEL IS CONSIDERED
NORMAL HOME TO WORK TRAVEL. FEDERAL PERSONNEL MANUAL LETTER 55-10,
APRIL 30, 1976, PAGE 2 OF ATTACHMENT. WE ALSO NOTE THAT THERE IS
NOTHING IN THE RECORD TO SUGGEST THAT EMPLOYEES PERFORMED ANY WORK OR
ANY PRELIMINARY OR POSTLIMINARY ACTIVITIES WHILE TRAVELING ON THE BUSES
OR UPON THEIR ARRIVAL AT THE JACKSON HEIGHTS OFFICE. SEE 29 U.S. C.
SEC. 254(A)(2); PORTER C. MURPHY, 55 COMP.GEN. 1009 (1976); D.A. & S.
OIL WELL SERVICING, INC. V. MITCHELL, 262 F.2D 552, (10TH CIR. 1958);
TANAKA V. RICHARD K.W. TOM, INC., 299 F.SUPP. 732 (D. HAWAII, 1969).
IN VIEW OF THE ABOVE, THE UNION'S CLAIM FOR OVERTIME COMPENSATION IS
DENIED.
B-210692, JUN 27, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE THE ONLY EVIDENCE ON AN ISSUE OF FACT IS THE CONFLICTING
STATEMENTS OF THE PROTESTER AND THE CONTRACTING OFFICIALS, THE PROTESTER
HAS NOT CARRIED THE BURDEN OF PROVING ITS CASE.
2. WHERE THE CONDUCT OF THE PROTESTER CAUSED THE PROCURING ACTIVITY
TO REASONABLY BELIEVE THAT THE PROTESTER CONSENTED TO ITS EMPLOYEE
MAKING AN OFFER, THE EMPLOYEE HAD APPARENT AUTHORITY TO MAKE THE OFFER
AND THE PROCURING ACTIVITY COULD ACT IN RELIANCE ON THE OFFER EVEN IF
THE EMPLOYEE LACKED ACTUAL AUTHORITY TO MAKE THE OFFER.
3. THE BURDEN IS ON THE SUPPLIER OF AN ITEM LISTED UNDER A FEDERAL
SUPPLY SCHEDULE CONTRACT TO NOTIFY THE CONTRACTING ACTIVITY OF PRICE
REDUCTIONS ACCEPTED BY THE GENERAL SERVICES ADMINISTRATION. WHERE THE
PROTESTER FAILED TO INFORM THE PROCUREMENT AGENT OF THE PRICE REDUCTION
AND THE PROCUREMENT AGENT LACKED ACTUAL NOTICE OF THE REDUCTION, THE
PROCURING ACTIVITY NEED NOT CONSIDER THE PRICE REDUCTION IN DETERMINING
THE LOW PRICE.
DICTAPHONE CORPORATION:
DICTAPHONE CORPORATION (DICTAPHONE) PROTESTS THE ISSUANCE BY THE
UNITED STATES SECRET SERVICE OF DELIVERY ORDER NO. 83-924 TO LANIER
BUSINESS PRODUCTS, INC. (LANIER), FOR DICTATION EQUIPMENT TO BE
INSTALLED IN THE NEW YORK, NEW YORK, OFFICES OF THE SECRET SERVICE. THE
SECRET SERVICE ISSUED THE ORDER UNDER THE GENERAL SERVICES
ADMINISTRATION'S (GSA) FEDERAL SUPPLY SCHEDULE CONTRACT NO.
GS-00S-63027. WE DENY THE PROTEST.
THE SECRET SERVICE'S VERSION OF THE ESSENTIAL FACTS OF THIS
PROCUREMENT IS AS DESCRIBED IN THE NEXT THREE PARAGRAPHS.
ON DECEMBER 20, 1982, A PROCUREMENT AGENT FOR THE SECRET SERVICE
CALLED DICTAPHONE TO REQUEST A PRICE QUOTATION FOR THE DICTATION
EQUIPMENT. MR. BRODERICK FROM THE DICTAPHONE OFFICE IN WASHINGTON, D.
C., QUOTED THE SECRET SERVICE A PRICE DERIVED FROM A PREVIOUS AUGUST
1982 QUOTATION. ALSO, ON DECEMBER 20, THE PROCUREMENT AGENT REQUESTED A
PRICE QUOTATION FROM LANIER. MR. GARRITY FROM THE NEW YORK OFFICE OF
DICTAPHONE SUBSEQUENTLY CALLED THE PROCUREMENT AGENT ON JANUARY 6 AND
JANUARY 10, 1983, TO INCREASE THE TRADE-IN ALLOWANCE OFFERED BY
DICTAPHONE. ON JANUARY 12, 1983, THE SECRET SERVICE RECEIVED A PRICE
QUOTATION FROM LANIER OF $15,843.50, WHICH WAS LOW IN COMPARISON TO
DICTAPHONE'S QUOTATION.
ON JANUARY 12, AS THE PROCUREMENT AGENT PREPARED TO ISSUE A DELIVERY
ORDER TO DICTAPHONE, MR. GARRITY AGAIN CALLED. IN ORDER TO IMPRESS UPON
HIM THAT THE TIME HAD COME FOR THE SECRET SERVICE TO PLACE AN ORDER AND
THAT MR. GARRITY COULD NOT CONTINUE TO MODIFY DICTAPHONE'S QUOTATION,
THE PROCUREMENT AGENT REQUESTED A "BEST AND FINAL" QUOTATION. THE
SECRET SERVICE CLAIMS THAT MR. GARRITY AGAIN INCREASED THE TRADE-IN
ALLOWANCE, THUS REDUCING DICTAPHONE'S QUOTATION TO $16,106.20, WHICH WAS
STILL HIGH IN COMPARISON WITH LANIER'S QUOTATION. BY CONTRAST,
DICTAPHONE CLAIMS THAT WHEN MR. GARRITY WAS INFORMED OF THE REQUEST FOR
A BEST AND FINAL QUOTATION, HE INSTEAD TOLD THE PROCUREMENT AGENT THAT
THE QUOTATION MUST COME FROM THE WASHINGTON OFFICE OF DICTAPHONE. IN
ANY CASE, THE SECRET SERVICE ISSUED A DELIVERY ORDER TO LANIER AS THE
LOW QUOTER ON JANUARY 14.
ON JANUARY 17, MR. BRODERICK AGAIN CALLED THE PROCUREMENT AGENT.
WHEN INFORMED THAT A BEST AND FINAL OFFER HAD BEEN REQUESTED AND THAT A
DELIVERY ORDER HAD THEN BEEN ISSUED, MR. BRODERICK DECLARED THAT HE HAD
BEEN UNAWARE OF ANY REQUEST FOR A BEST AND FINAL OFFER AND STATED THAT
ONLY THE WASHINGTON OFFICE, AND NOT THE NEW YORK OFFICE, WAS AUTHORIZED
TO SUBMIT QUOTATIONS FOR THIS PROCUREMENT. MR. BOSS FROM DICTAPHONE'S
WASHINGTON OFFICE THEN DELIVERED A NEW PRICE QUOTATION TO THE
PROCUREMENT AGENT ON JANUARY 18. DICTAPHONE NOT ONLY OFFERED A TRADE-IN
ALLOWANCE AND THE 13-PERCENT "GSA DISCOUNT" PREVIOUSLY QUOTED TO THE
SECRET SERVICE, BUT ALSO INCLUDED A QUANTITY DISCOUNT OF SIX UNITS FOR
THE PRICE OF FIVE, THEREBY LOWERING THE NET COST OF DICTAPHONE'S
QUOTATION TO $15,233.70.
DICTAPHONE CONTENDS THAT IT IS OPEN TO QUESTION WHEN THE SECRET
SERVICE RECEIVED A PROPER QUOTATION FROM DICTAPHONE. IF BY THIS
CONTENTION, DICTAPHONE SEEKS TO RAISE A FACTUAL ISSUE AS TO THE CONTENT
OF MR. GARRITY'S JANUARY 12 CONVERSATION WITH THE PROCUREMENT AGENT, WE
CONCLUDE THAT DICTAPHONE HAS FAILED TO PROVE THAT MR. GARRITY DID NOT
THEN KNOWINGLY OFFER A "BEST AND FINAL" PRICE QUOTATION TO THE SECRET
SERVICE. WHERE THE ONLY EVIDENCE ON AN ISSUE OF FACT IS THE CONFLICTING
STATEMENTS OF THE PROTESTER AND THE CONTRACTING OFFICIALS, THE PROTESTER
HAS NOT CARRIED THE BURDEN OF PROVING ITS CASE. SEE EAST WIND
INDUSTRIES, INC., B-208170, DECEMBER 29, 1982, 82-2 CPD 587. THEREFORE,
WE MUST CONCLUDE THAT DICTAPHONE WAS GIVEN AN EQUITABLE OPPORTUNITY TO
SUBMIT ITS "BEST AND FINAL" PRICE QUOTATION.
IF, BY THE ABOVE CONTENTION, DICTAPHONE SEEKS TO RAISE AN ISSUE AS TO
MR. GARRITY'S ALLEGED LACK OF ACTUAL AUTHORITY TO OFFER PRICE
QUOTATIONS, WE CONCLUDE THAT THE PROCUREMENT AGENT NEVERTHELESS PROPERLY
ACTED IN RELIANCE UPON THE JANUARY 12 QUOTATION SUBMITTED BY MR.
GARRITY. A PRINCIPAL IS BOUND BY THE ACTS OF HIS AGENT NOT ONLY WHEN
THE AGENT HAS ACTUAL AUTHORITY TO SO ACT, BUT ALSO WHEN THE AGENT ACTS
WITH APPARENT AUTHORITY. APPARENT AUTHORITY TO DO AN ACT IS CREATED AS
TO A THIRD PERSON BY CONDUCT OF THE PRINCIPAL WHICH REASONABLY CAUSES
THE THIRD PERSON TO BELIEVE THAT THE PRINCIPAL CONSENTS TO HAVE THE ACT
DONE ON HIS BEHALF BY THE AGENT. RESTATEMENT (SECOND) OF AGENCY SECS. 8,
27 (1957). GIVEN MR. GARRITY'S POSITION WITH THE NEW YORK OFFICE OF
DICTAPHONE AND GIVEN HIS KNOWLEDGE OF THE SECRET SERVICE'S PRECISE
NEEDS, WHICH MR. GARRITY DEMONSTRATED BY THE PRICE QUOTATIONS, THE
PROCUREMENT AGENT HAD REASONABLE GROUNDS FOR HER APPARENT BELIEF THAT
MR. GARRITY WAS AUTHORIZED TO OFFER PRICE QUOTATIONS TO THE SECRET
SERVICE.
DICTAPHONE ALSO CONTENDS THAT THE SECRET SERVICE "CREATED AN ONGOING
SCENARIO FOR NEGOTIATION" BY DISCUSSING DICTAPHONE'S QUANTITY DISCOUNT
WITH THE COMPANY, EVEN AFTER THE AWARD OF THE ORDER. ALTHOUGH THE
SECRET SERVICE APPARENTLY DID HAVE THE ALLEGED DISCUSSIONS AS TO THE
PRECISE AMOUNT OF DICTAPHONE'S DISCOUNT, WE SEE NOTHING IN THE RECORD
WHICH WOULD INDICATE THAT THE SECRET SERVICE EVER FORMALLY REOPENED
NEGOTIATIONS WITH THESE "DISCUSSIONS" WITH AN INTENT OF RECEIVING NEW
"BEST AND FINAL" QUOTATIONS FROM BOTH LANIER AND DICTAPHONE. THEREFORE,
AND SINCE THE DELIVERY ORDER HAD ALREADY BEEN AWARDED WHEN THESE
"DISCUSSIONS" WERE HELD, DICTAPHONE'S JANUARY 18 QUOTATION WAS PROPERLY
REJECTED.
DICTAPHONE ALSO SUGGESTS THAT ITS JANUARY 12 PRICE QUOTATION SHOULD
HAVE BEEN FOUND TO BE LOW BECAUSE THE QUANTITY DISCOUNT, ALTHOUGH FIRST
MENTIONED TO THE PROCUREMENT AGENT ONLY ON JANUARY 18, HAD BEEN ACCEPTED
BY THE GSA AS A MODIFICATION TO DICTAPHONE'S FEDERAL SUPPLY SCHEDULE
CONTRACT EFFECTIVE NOVEMBER 24, 1982, AND, THUS, THE QUANTITY DISCOUNT
SHOULD HAVE BEEN CONSIDERED IN EVALUATING DICTAPHONE'S QUOTATION. THE
BURDEN IS ON THE SUPPLIER OF AN ITEM LISTED UNDER A FEDERAL SUPPLY
SCHEDULE CONTRACT TO NOTIFY THE CONTRACTING ACTIVITIES OF PRICE
REDUCTIONS ACCEPTED BY GSA. ABSENT ACTUAL NOTICE OF THE PRICE
REDUCTION, THE CONTRACTING ACTIVITY NEED NOT CONSIDER THE PRICE
REDUCTION IN DETERMINING THE LOW PRICE. DICTAPHONE CORPORATION,
B-195043, SEPTEMBER 25, 1979, 79-2 CPD 222. SINCE DICTAPHONE HAS NOT
ALLEGED, NOR IS THERE ANY INDICATION IN THE RECORD, THAT THE PROCUREMENT
AGENT HAD RECEIVED ACTUAL NOTICE OF THE QUANTITY DISCOUNT, THE SECRET
SERVICE WAS JUSTIFIED IN NOT CONSIDERING THE DISCOUNT WHEN IT EVALUATED
DICTAPHONE'S "BEST AND FINAL" QUOTATION ON JANUARY 12.
THE PROTEST IS DENIED.
B-210689, MAY 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST THAT SOLICITATION WAS AMBIGUOUS AS TO THE MANNER IN WHICH
ITEMS WERE TO BE BID IS DISMISSED AS ACADEMIC BECAUSE, EVEN USING
INTENDED BID OF PROTESTER, BID IS NOT LOW.
WEDLAKE SERVICES:
WEDLAKE SERVICES (WEDLAKE) PROTESTS THAT THE BIDDING SCHEDULE IN
INVITATION FOR BIDS (IFB) NO. F33601-83-B0004, ISSUED BY THE DEPARTMENT
OF THE AIR FORCE (AIR FORCE), WAS AMBIGUOUS AND, THEREFORE, THE IFB
SHOULD BE CANCELED AND THE REQUIREMENT RESOLICITED.
THE PROTEST IS DISMISSED AS ACADEMIC.
THE SOLICITATION WAS FOR FULL FOOD SERVICES MANAGEMENT FOR A DINING
HALL LOCATED AT WRIGHT-PATTERSON AIR FORCE BASE, OHIO. BIDDERS WERE TO
BID ON A BASIC YEAR AND 2 OPTION YEARS.
WEDLAKE'S BID PRICES FOR THE BASIC YEAR ARE $470,300 FOR 0001AA,
$470,096.55 FOR 0001AB, $369 FOR 0002, AND $28,800 FOR 0003. THESE
PRICES WERE ADDED FOR A TOTAL BASIC YEAR BID OF $969,565.55. WEDLAKE'S
OPTION YEARS' PRICES FOLLOWED THE SAME PATTERN. WEDLAKE PROTESTS THAT
THE SOLICITATION DID NOT CLEARLY STATE THAT THE AIR FORCE INTENDED TO
PAY A COMBINATION OF LINE ITEMS 0001AA, 0001AB, 0002, AND 0003. IT
THEREFORE CLAIMS TO HAVE SUBMITTED ITS BID IN THE SAME FASHION AS IT HAD
IN PAST SOLICITATIONS AND IT APPEARS WEDLAKE EXPECTED TO BE PAID ONLY
FOR 0001AA OR 0001AB. WEDLAKE CLAIMS IT ACTUALLY INTENDED TO BID
$470,557.55 FOR THE BASIC YEAR.
EVEN ASSUMING WEDLAKE IS CORRECT REGARDING ITS MISINTERPRETATION OF
THE SOLICITATION AND INTENDED BID PRICE, IT WAS NOT PREJUDICED, AS IT
WOULD NOT BE THE LOW EVALUATED BIDDER (BASIC CONTRACT PLUS 2 OPTION
YEARS) IN ANY EVENT. THEREFORE, THE PROTEST IS ACADEMIC AND IS
DISMISSED.
B-210687, JUL 26, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. INCIDENT TO A TRANSFER OF DUTY STATION, THE EMPLOYEE
SHIPPED HOUSEHOLD GOODS EXCEEDING THE STATUTORY MAXIMUM OF 11,000
POUNDS BY 4,800 POUNDS. HE HAS REPAID THE GOVERNMENT FOR ONLY
2,000 POUNDS OF THE EXCESS BECAUSE THE ORAL ESTIMATE HE RECEIVED
FROM THE CARRIER'S AGENT WAS ONLY 13,000 POUNDS, AND HE DID NOT
RECEIVE A LATER WRITTEN ESTIMATE OF 15,000 POUNDS. SINCE THE
MAXIMUM PAYABLE BY THE GOVERNMENT UNDER 5 U.S.C. SEC. 5724(A) IS
11,000 POUNDS REGARDLESS OF EXTENUATING CIRCUMSTANCES, THE
EMPLOYEE MUST REPAY THE COST OF THE ENTIRE EXCESS, LESS THE
SHIPPING COST OF ANY PROFESSIONAL BOOKS AND PAPERS PROPERLY PROVEN
TO HAVE BEEN INCLUDED WITH THE HOUSEHOLD GOODS.
2. PROFESSIONAL BOOKS AND PAPERS INCLUDED WITHIN A SHIPMENT
OF HOUSEHOLD GOODS MAY BE AN ADMINISTRATIVE EXPENSE OF THE
EMPLOYING AGENCY EXCLUSIVE OF THE 11,000-POUND MAXIMUM WEIGHT
LIMITATION PAYABLE BY THE GOVERNMENT FOR THE TRANSPORTATION OF
HOUSEHOLD GOODS. BUT PROFESSIONAL BOOKS AND PAPERS MUST, IN
ACCORDANCE WITH PARA. 2-8.2A-1 OF THE FTR, BE INVENTORIED WITH THE
PROPER WEIGHT DETERMINATION AND CERTIFIED BY THE APPROPRIATE
OFFICIAL AT THE NEW DUTY STATION AS A NECESSARY SHIPMENT OF ITEMS
THAT THE GOVERNMENT WOULD OTHERWISE HAVE TO OBTAIN AT ITS EXPENSE.
BERT W. RUST:
IN THIS ADVANCE DECISION REQUESTED BY THE DEPUTY COMPTROLLER OF THE
NATIONAL BUREAU OF STANDARDS, DEPARTMENT OF COMMERCE, WE HOLD THAT THE
EMPLOYEE, MR. BERT W. RUST, MUST REPAY THE GOVERNMENT THE COST OF
SHIPPING HIS HOUSEHOLD GOODS WHICH EXCEEDS THE COST OF SHIPPING THE
11,000-POUND WEIGHT LIMIT PRESCRIBED IN 5 U.S.C. SEC. 5724. HIS
INDEBTEDNESS MAY NOT BE REDUCED BY THE COST OF TRANSPORTING ANY
PROFESSIONAL BOOKS AND PAPERS INCLUDED IN THE SHIPMENT UNLESS HE SUBMITS
AN ITEMIZED INVENTORY OF THE BOOKS AND OBTAINS THE ADMINISTRATIVE
CERTIFICATION REQUIRED BY PARAGRAPH 2-8.2A-1(3)(A) AND (B) OF THE
FEDERAL TRAVEL REGULATIONS (FTR) (FPMR TEMP. REG. A-11, SUPP. 4, APRIL
29, 1977).
INCIDENT TO MOVING FROM OAK RIDGE, TENNESSEE, TO HIS NEW DUTY STATION
AT GAITHERSBURG, MARYLAND, MR. RUST SHIPPED HIS HOUSEHOLD GOODS BY
GOVERNMENT BILL OF LADING. AN AGENT OF THE CARRIER SIGNED A WRITTEN
ESTIMATE APPROXIMATING THE WEIGHT OF THE HOUSEHOLD GOODS TO BE 15,000
POUNDS. HOWEVER, MR. RUST STATES THAT AN EMPLOYEE OF THE AGENT HAD
GIVEN HIM AN ORAL ESTIMATE OF NOT MORE THAN 13,000 POUNDS. SHIPMENT OF
THE ACTUAL WEIGHT OF 15,880 POUNDS COST $3,522.25, WHICH THE GOVERNMENT
PAID THE CARRIER. THE NATIONAL BUREAU OF STANDARDS BILLED MR. RUST
$1,181.90, REPRESENTING THE COST OF PACKING AND SHIPPING 4,880 POUNDS IN
EXCESS OF THE STATUTORY MAXIMUM OF 11,000 POUNDS TO BE SHIPPED AT
GOVERNMENT EXPENSE. SINCE HE BELIEVES HE IS ONLY RESPONSIBLE FOR THE
13,000-POUND ORAL ESTIMATE, HE REPAID THE NATIONAL BUREAU OF STANDARDS
$345.04, REPRESENTING HIS ESTIMATE OF HIS LIABILITY. THE NATIONAL
BUREAU OF STANDARDS SEEKS REPAYMENT OF AN ADDITIONAL $836.86 FOR THE
REMAINDER OF THE ACTUAL 4,880 POUNDS ABOVE THE STATUTORY MAXIMUM. FROM
THIS AMOUNT IT IS WILLING TO DEDUCT THE COST OF SHIPPING ANY
PROFESSIONAL BOOKS INCLUDED IN THE 4,800 POUNDS, SINCE THESE MAY BE
SHIPPED AT GOVERNMENT EXPENSE EXCLUSIVE OF THE STATUTORY MAXIMUM.
MR. RUST BELIEVES THAT SINCE THE SHIPMENT CONTRACT WAS BETWEEN THE
GOVERNMENT AND THE CARRIER, THE GOVERNMENT SHOULD BEAR THE
RESPONSIBILITY FOR MONITORING THE WEIGHT OF HOUSEHOLD GOODS. HE
REJECTED A PROPOSAL OF THE CHIEF, FACILITIES SERVICE DIVISION, NATIONAL
BUREAU OF STANDARDS, THAT THE WEIGHT OF ANY PROFESSIONAL BOOKS AND
PAPERS INCLUDED WITH THE HOUSEHOLD GOODS SHIPMENT BE ESTIMATED BY AN
EMPLOYEE OF THE NATIONAL BUREAU OF STANDARDS WITH A SECOND ESTIMATE
OBTAINED BY MR. RUST AT HIS EXPENSE IF HE SO DESIRED. MR. RUST BELIEVES
THAT THE CARRIER SHOULD HAVE WEIGHED THE PROFESSIONAL BOOKS AND PAPERS
SEPARATELY, ALTHOUGH HE IS WILLING TO ASSUME THAT THEIR WEIGHT EQUALLED
THAT OF PROFESSIONAL BOOKS AND PAPERS HE HAD TRANSPORTED BY A SEPARATE
SHIPMENT.
AUTHORITY FOR TRANSPORTING THE HOUSEHOLD EFFECTS OF TRANSFERRED
EMPLOYEES AT GOVERNMENT EXPENSE IS FOUND AT 5 U.S.C. SEC. 5724(A), WHICH
ESTABLISHES 11,000 POUNDS AS THE MAXIMUM WEIGHT OF GOODS AUTHORIZED TO
BE TRANSPORTED. SINCE THE 11,000-POUND WEIGHT LIMITATION IS STATUTORY,
NO GOVERNMENT AGENCY OR EMPLOYEE HAS THE AUTHORITY TO PERMIT
TRANSPORTATION IN EXCESS OF THE WEIGHT LIMITATION. THUS, THE LAW DOES
NOT PERMIT PAYMENT OF THE CHARGES BY THE GOVERNMENT FOR THE EXCESS
WEIGHT REGARDLESS OF THE REASONS FOR THE SHIPMENT OF THE EXCESSIVE
WEIGHT. RONALD E. ADAMS, B-199545, AUGUST 22, 1980.
IMPLEMENTING REGULATIONS FOR THE TRANSPORTATION AND TEMPORARY STORAGE
OF HOUSEHOLD GOODS ARE CONTAINED AT CHAPTER 2, PART 8, OF THE FEDERAL
TRAVEL REGULATIONS (FPMR 101-7, MAY 1973). IF PROPERTY SHIPPED BY
GOVERNMENT BILL OF LADING EXCEEDS THE WEIGHT ALLOWABLE (11,000 POUNDS),
PARAGRAPH 2-8.3B(5) OF THE FEDERAL TRAVEL REGULATIONS IMPOSES ON THE
EMPLOYEE THE " *** CHARGES APPLICABLE TO THE EXCESS WEIGHT, COMPUTED
FROM THE TOTAL CHARGES ACCORDING TO THE RATIO OF EXCESS WEIGHT TO THE
TOTAL WEIGHT OF THE SHIPMENT."
THE FEDERAL TRAVEL REGULATIONS HAVE THE FORCE AND EFFECT OF LAW AND
MAY NOT BE WAIVED OR MODIFIED BY THE EMPLOYING AGENCY OR THE GENERAL
ACCOUNTING OFFICE REGARDLESS OF ANY EXTENUATING CIRCUMSTANCES. RONALD
E. ADAMS, B-199545, AUGUST 22, 1980.
IT MAY BE THAT MR. RUST DID NOT RECEIVE TIMELY WRITTEN NOTICE THAT
THE CARRIER'S AGENT HAD ESTIMATED THE HOUSEHOLD GOODS TO WEIGH 15,000
POUNDS RATHER THAN THE EARLIER ORAL ESTIMATE OF 13,000 POUNDS. HOWEVER,
AS NOTED ABOVE THERE IS NO AUTHORITY FOR THE GOVERNMENT TO PAY THE COSTS
OF A SHIPMENT OF HOUSEHOLD GOODS IN EXCESS OF 11,000 POUNDS. SEE
B-189358, FEBRUARY 8, 1978. ACCORDINGLY, MR. RUST IS RESPONSIBLE FOR
REPAYING THE EXPENSE OF THE EXCESS WEIGHT.
FURTHER, MR. RUST'S INDEBTEDNESS MAY NOT BE REDUCED BASED SOLELY UPON
HIS OWN STATEMENT THAT HE SHIPPED PROFESSIONAL BOOKS AND PAPERS WITH THE
SHIPMENT AND THAT HIS ESTIMATE OF THE WEIGHT INVOLVED WAS THE SAME AS
THE WEIGHT OF SUCH ITEMS HE HAD TRANSPORTED BY A SEPARATE SHIPMENT.
WHERE THE WEIGHT OF PROFESSIONAL BOOKS, PAPERS, AND EQUIPMENT WOULD
CAUSE THE EMPLOYEE'S HOUSEHOLD GOODS SHIPMENT TO EXCEED THE MAXIMUM
WEIGHT ALLOWANCE, THEY MAY BE TRANSPORTED TO THE NEW DUTY STATION AS AN
ADMINISTRATIVE EXPENSE OF THE AGENCY IN ACCORDANCE WITH PARAGRAPH
2-8.2A-1 OF THE FTR (FPMR TEMP. REG. A-11, SUPP. 4, APRIL 29, 1977).
WHEN SHIPPED IN THE SAME LOT WITH THE EMPLOYEE'S HOUSEHOLD GOODS AND
OTHER PERSONAL EFFECTS UNDER THE ACTUAL EXPENSE METHOD, THE PROFESSIONAL
BOOKS, PAPERS, AND EQUIPMENT MUST BE PACKED AND WEIGHED SEPARATELY; THE
WEIGHT AND THE ADMINISTRATIVE APPROPRIATION CHARGEABLE SHOULD BE STATED
AS SEPARATE ITEMS ON THE GOVERNMENT BILL OF LADING. IN UNUSUAL INSTANCES
IN WHICH IT IS IMPRACTICAL OR IMPOSSIBLE TO OBTAIN SEPARATE WEIGHTS, A
CONSTRUCTIVE WEIGHT OF 7 POUNDS PER CUBIC FOOT MAY BE USED. SEE
PARAGRAPH 2-8.2A-1(3)(C) OF THE FTR (FPMR TEMP. REG. A-11, SUPP. 4,
APRIL 29, 1977). HOWEVER, PARAGRAPH 2-8.2A-1(3)(A) AND (B) OF THIS
AUTHORITY REQUIRE THE EMPLOYEE TO FURNISH AN ITEMIZED INVENTORY OF THE
PROFESSIONAL BOOKS, PAPERS, AND EQUIPMENT FOR REVIEW BY AN APPROPRIATE
AUTHORIZING OFFICIAL AT THE NEW PERMANENT DUTY STATION. THIS OFFICIAL
MUST ALSO CERTIFY THAT THE SHIPMENT WAS NECESSARY IN THE PROPER
PERFORMANCE OF THE EMPLOYEE'S DUTIES AT THE NEW DUTY STATION, AND THAT
SIMILAR MATERIALS WOULD HAVE HAD TO BE OBTAINED AT GOVERNMENT EXPENSE IF
THEY HAD NOT BEEN TRANSPORTED TO THE EMPLOYEE'S NEW DUTY STATION.
ANY REDUCTION OF MR. RUST'S INDEBTEDNESS FOR TRANSPORTATION OF
PROFESSIONAL BOOKS AND PAPERS MUST BE CONSISTENT WITH THE ABOVE
PROVISIONS. MATTER OF BROWN AND SCHMIDT, B-199780, FEBRUARY 17, 1981.
B-210686, OCT 19, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
AFTER COMPLETING TEMPORARY DUTY IN KUALA
LUMPUR, MALAYSIA, ON FRIDAY AFTERNOON THE
CLAIMANT STARTED HIS RETURN TRIP TO WRIGHT-PATTERSON
AIR FORCE BASE ON SATURDAY. HE
ARRIVED IN HONG KONG AT 1:35 P.M. ON THAT
DAY AND REMAINED THERE UNTIL 1 P.M. ON
MONDAY. HE COMPLETED TRAVEL TO OHIO ON
TUESDAY AND REPORTED FOR DUTY ON WEDNESDAY.
THE AGENCY'S CONSTRUCTIVE SCHEDULING OF HIS
RETURN TRAVEL CALLED FOR HIM TO DEPART HONG
KONG ON SUNDAY, A NONWORKDAY, AND REPORT FOR
DUTY ON TUESDAY. BASED ON THAT SCHEDULE THE
AGENCY CHARGED THE EMPLOYEE 8 HOURS ANNUAL
LEAVE FOR TUESDAY. SINCE AN AGENCY MAY
CHARGE AN EMPLOYEE ANNUAL LEAVE WHEN HE
INTERRUPTS HIS TRAVEL FOR PERSONAL REASONS,
THIS CHARGE TO ANNUAL LEAVE WAS NOT
IMPROPER.
FRANCIS A. BRENNAN:
WE HAVE BEEN ASKED WHETHER THE AIR FORCE PROPERLY CHARGED MR.
FRANCIS A. BRENNAN, A CIVILIAN EMPLOYEE, 8 HOURS ANNUAL LEAVE IN
CONNECTION WITH HIS RETURN FROM TEMPORARY DUTY IN MALAYSIA IN SEPTEMBER
1981. SINCE AN AGENCY HAS THE DISCRETION TO CHARGE LEAVE TO EMPLOYEES
WHO DELAY OFFICIAL TRAVEL FOR PERSONAL REASONS THE CHARGE TO LEAVE IN
THIS CASE WAS WITHIN THE AUTHORITY OF THE RESPONSIBLE AIR FORCE
OFFICIALS.
THE CHIEF, TRAVEL ENTITLEMENTS AND SYSTEMS BRANCH, DIRECTORATE OF
PLANS AND SYSTEMS, DEPARTMENT OF THE AIR FORCE, REQUESTED AN ADVANCE
DECISION IN THIS CASE. THE REQUEST WAS FORWARDED BY THE PER DIEM,
TRAVEL AND TRANSPORTATION ALLOWANCE COMMITTEE, DEPARTMENT OF DEFENSE,
UNDER CONTROL NO. 83-4.
MR. BRENNAN COMPLETED HIS TEMPORARY DUTY IN KUALA LUMPUR, MALAYSIA,
ON FRIDAY, SEPTEMBER 11, 1981. HE DEPARTED SATURDAY MORNING, SEPTEMBER
12, 1981, FOR RETURN TO WRIGHT-PATTERSON AIR FORCE BASE, OHIO. HE
ARRIVED IN HONG KONG AT 1:35 P.M. THAT DAY AND, AS CONTEMPLATED BY HIS
TRAVEL ORDERS, DID NOT IMMEDIATELY CONTINUE HIS JOURNEY. BUT INSTEAD OF
LEAVING HONG KONG ON SUNDAY HE DEPARTED FOR THE UNITED STATES AT 1 P.M.
ON MONDAY, SEPTEMBER 14, 1981. HE DID NOT REPORT FOR DUTY AT
WRIGHT-PATTERSON AIR FORCE BASE UNTIL WEDNESDAY, SEPTEMBER 16, 1981.
BECAUSE OF THE DELAY IN MR. BRENNAN'S TRAVEL THE AIR FORCE FORMULATED
A CONSTRUCTIVE SCHEDULING OF HIS TRAVEL FOR PURPOSES OF DETERMINING
WHETHER HE SHOULD BE CHARGED LEAVE. THE CONSTRUCTIVE SCHEDULE INVOLVES
A DEPARTURE FROM HONG KONG ON SUNDAY AT 11:05 A.M. AND ARRIVAL IN
DAYTON, OHIO, THE EMPLOYEE'S RESIDENCE IN THE WRIGHT-PATTERSON AREA THAT
SAME DAY. SINCE THE TRAVEL INVOLVED CROSSING THE INTERNATIONAL
DATELINE, MORE THAN 1 DAY'S TRAVEL WAS REQUIRED FOR THIS PART OF THE
JOURNEY. THE AIR FORCE DID NOT CHARGE LEAVE FOR MONDAY BUT FOUND THAT
MR. BRENNAN SHOULD HAVE REPORTED FOR DUTY ON TUESDAY, SEPTEMBER 15,
1981. BECAUSE HE DID NOT REPORT FOR DUTY ON TUESDAY THE AIR FORCE
CHARGED HIM 8 HOURS ANNUAL LEAVE FOR THAT DAY.
ALTHOUGH MR. BRENNAN DID NOT CLAIM PER DIEM FOR SUNDAY, THE DAY OF
HIS DELAY, HE OBJECTED TO BEING CHARGED LEAVE ON A CONSTRUCTIVE BASIS
FOR THE DELAY CAUSED BY HIS 2-DAY STAY IN HONG KONG. HE CITED 53 COMP.
GEN. 882 (1974) (B-180084, MAY 17, 1974) IN SUPPORT OF HIS CLAIM. IN
THAT CASE TWO NAVY EMPLOYEES COMPLETED TEMPORARY DUTY ON SATURDAY.
INSTEAD OF RETURNING TO THEIR PERMANENT DUTY STATION ON SUNDAY ONE
RETURNED ON MONDAY, THE OTHER TOOK ANNUAL LEAVE ON MONDAY AND RETURNED
ON TUESDAY. THE EMPLOYEES OBTAINED AN ADVISORY ARBITRATION AWARD UNDER
WHICH THEY WERE TO BE PAID AN EXTRA DAY'S PER DIEM AND WERE NOT TO BE
CHARGED ANNUAL LEAVE FOR THE TRAVEL DAY. WE WERE ASKED WHETHER THAT
AWARD COULD LEGALLY BE ENFORCED. WE APPLIED THE EXISTING RULES AND HELD
THAT THE ARBITRATION AWARD OF PER DIEM AND REINSTATEMENT OF LEAVE COULD
BE IMPLEMENTED. IN DECISIONS RELATING TO THE CHARGING OF LEAVE WHEN AN
EMPLOYEE DELAYS TRAVEL FOR PERSONAL REASONS WE HAVE HELD THAT THE AGENCY
HAS DISCRETION TO CHARGE LEAVE WHEN THE INDIVIDUAL HAS DELAYED HIS
RETURN TO DUTY FOR PERSONAL REASONS. MATTER OF DERBY, B-203915, JUNE 8,
1982.
IN THIS CASE, THE AGENCY PREPARED A CONSTRUCTIVE TRAVEL SCHEDULE IN
ORDER TO DETERMINE MR. BRENNAN'S ENTITLEMENTS. THERE IS NO INDICATION
THAT THE AGENCY WOULD HAVE PAID MR. BRENNAN'S PER DIEM AND REFRAINED
FROM CHARGING LEAVE HAD HE DELAYED HIS TRAVEL UNTIL MONDAY IN KUALA
LUMPUR IN ORDER TO TRAVEL ON GOVERNMENT TIME. SINCE HE DELAYED HIS
TRAVEL IN HONG KONG THE AGENCY WAS AUTHORIZED TO COMPUTE HIS PER DIEM
AND LEAVE ENTITLEMENTS ON A CONSTRUCTIVE TRAVEL SCHEDULE AS THEY DID.
THAT SCHEDULE IS THE BASIS FOR MR. BRENNAN'S ENTITLEMENT TO PER DIEM AND
ALSO WAS THE BASIS FOR DETERMINING THE APPROPRIATE LEAVE CHARGE FOR
EXCESS TRAVELTIME.
ON THE BASIS OF THAT CONSTRUCTIVE TRAVEL SCHEDULE, THE AGENCY HAS
DETERMINED THAT MR. BRENNAN SHOULD HAVE DELAYED FOR ONLY ONE DAY IN HONG
KONG AS AUTHORIZED IN HIS TRAVEL ORDERS. ALTHOUGH HE COULD HAVE
RETURNED TO HIS DUTY STATION ON SUNDAY EVENING, HE WAS NOT CHARGED LEAVE
FOR MONDAY PRESUMABLY BECAUSE OF THE LENGTH OF HIS TRIP AND THE LATENESS
OF HIS RETURN. HE HAS NOT PRESENTED ANY EVIDENCE QUESTIONING THE
PROPRIETY OF THE CONSTRUCTIVE TRAVEL SCHEDULE PREPARED BY THE AGENCY.
THEREFORE, WE FIND NO BASIS TO QUESTION THE EXERCISE OF THE AGENCY'S
DISCRETION IN CHARGING HIM 8 HOURS OF ANNUAL LEAVE FOR HIS ABSENCE ON
TUESDAY.
B-210685, FEB 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST AGAINST SPECIFICATIONS AND DELIVERY SCHEDULE IN A
SOLICITATION IS DISMISSED AS UNTIMELY WHEN FILED AFTER BID OPENING
BECAUSE GAO BID PROTEST PROCEDURES REQUIRE FILING PRIOR TO BID OPENING
WHERE ALLEGED IMPROPRIETIES ARE APPARENT BEFORE BID OPENING.
PEABODY BARNES INC.:
PEABODY BARNES INC. (PEABODY) PROTESTS AGAINST THE SPECIFICATIONS
USED BY THE DEPARTMENT OF THE ARMY IN SOLICITATION NO.
DAAJ09-82-B-B324. PEABODY ALLEGES A NUMBER OF DISCREPANCIES BETWEEN THE
SOLICITATION SPECIFICATIONS AND THE MILITARY SPECIFICATIONS INCORPORATED
THEREIN AND THAT THE DELIVERY SCHEDULE IS IMPRACTICAL. PEABODY FILED
ITS PROTEST WITH OUR OFFICE ON FEBRUARY 2, 1983. BID OPENING WAS HELD
ON JANUARY 26, 1983.
SECTION 21.2(B)(1) OF OUR BID PROTEST PROCEDURES REQUIRES THAT A
PROTEST BASED UPON ALLEGED IMPROPRIETIES IN AN INVITATION FOR BIDS WHICH
ARE APPARENT PRIOR TO BID OPENING BE FILED PRIOR TO BID OPENING. 4
C.F.R. PART 21 (1982). THE SPECIFICATIONS AND DELIVERY SCHEDULE AND ANY
OBJECTIONS THERETO WERE ASCERTAINABLE FROM READING THE SOLICITATION
PRIOR TO BID OPENING. SINCE THE BASIS OF THE PROTEST WAS APPARENT
BEFORE BID OPENING, BUT THE PROTEST WAS FILED AFTER BID OPENING, IT IS
UNTIMELY. IN ACCORD WITH SECTION 21.2(B)(1) OF OUR PROCEDURES, THE
PROTEST IS DISMISSED.
B-210684, B-210684.2, DEC 21, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. ALTHOUGH A CONTRACTING OFFICER HAS BROAD
DISCRETION TO CANCEL A SOLICITATION, BECAUSE OF THE POTENTIAL
IMPACT ON THE COMPETITIVE SYSTEM OF CANCELING AN INVITATION FOR
BIDS AFTER BID OPENING, REGULATIONS REQUIRE A COMPELLING REASON
FOR SUCH ACTION. THE FACT THAT SOME TERMS OF THE INVITATION FOR
BIDS ARE IN SOME WAY DEFICIENT DOES NOT, OF ITSELF, CONSTITUTE A
COMPELLING REASON TO CANCEL.
2. WHERE A SOLICITATION DOES NOT IDENTIFY THE
PRECISE NUMBER OF EACH ITEM TO BE SERVICED UNDER A CONTRACT, BUT
INSTEAD GROUPS TWO SIMILAR ITEMS TOGETHER IN A SINGLE QUANTITY,
BIDDERS CAN TAKE WHATEVER MINOR UNCERTAINTY IS INVOLVED INTO
ACCOUNT IN COMPUTING THEIR BIDS; THE SOLICITATION WAS NOT
DEFECTIVE MERELY BECAUSE THE NUMBER OF EACH ITEM WAS NOT PRECISELY
INDICATED.
3. ALTHOUGH HISTORICAL DATA CONTAINED IN A
SOLICITATION COULD BE MISLEADING TO BIDDERS IN LIGHT OF INCREASED
REQUIREMENTS UNDER THE NEW CONTRACT, WHEN THOSE INCREASED
REQUIREMENTS ARE IDENTIFIED AT A BIDDERS' CONFERENCE AND SPELLED
OUT IN A SOLICITATION AMENDMENT, NO BIDDER SHOULD BE MISLED AND
THE PRESENCE OF THE HISTORICAL DATA DOES NOT PROVIDE A BASIS FOR
CANCELING THE SOLICITATION AFTER BID OPENING.
4. WHERE AN INVITATION FOR BIDS CONTAINS A
NUMBER OF SEPARATE REQUIREMENTS, ONE OF WHICH IS SERVICING
GOVERNMENT-OWNED EQUIPMENT AND, AFTER BID OPENING, THE AGENCY
DISCOVERS THAT IT FAILED TO INCLUDE TWO ITEMS IN AN INVENTORY OF
APPROXIMATELY 844 ITEMS, AND THE RECORD SHOWS THAT ADDING THE TWO
MISSING ITEMS TO THE RESULTING CONTRACT WOULD VARY THE
CONTRACTOR'S OBLIGATION IN AN INSIGNIFICANT MANNER FROM THE STATED
SOLICITATION REQUIREMENTS AND WOULD HAVE LITTLE EFFECT ON PRICE,
THE NEED TO ADD THAT REQUIREMENT TO THE CONTRACT DOES NOT PROVIDE
A COMPELLING REASON TO CANCEL THE SOLICITATION.
DYNETERIA, INCORPORATED; TECOM, INCORPORATED:
DYNETERIA, INC. AND TECOM, INCORPORATED PROTEST THE CANCELLATION OF
SOLICITATION NO. F34650-83-B-0008 FOR GROUND SUPPORT SERVICES AT TINKER
AIR FORCE BASE, OKLAHOMA. BECAUSE WE AGREE THAT THERE WAS NO COGENT
REASON FOR CANCELLATION, WE SUSTAIN THE PROTEST.
THE CANCELED SOLICITATION
THE AIR FORCE ISSUED THIS INVITATION FOR BIDS ON DECEMBER 1, 1982
SEEKING A CONTRACTOR TO PROVIDE THE LABOR, PARTS AND MATERIAL NEEDED TO
POSITION, INSPECT, MAINTAIN AND REPAIR APPROXIMATELY 884 PIECES OF
GROUND SUPPORT EQUIPMENT AND TO PROVIDE CERTAIN OTHER SERVICES IN
SUPPORT OF FLIGHT OPERATIONS. AS WAS THE CASE FOR THE OTHER CATEGORIES
OF SERVICES, BIDS FOR THE MAINTENANCE OF THE GROUND SUPPORT EQUIPMENT
WERE OBTAINED ON A FIXED PRICE BASIS FOR ALL WORK REQUIRED DURING THE
CONTRACT YEAR AND FOR EACH OF THE 2 OPTION YEARS. HOWEVER, TO
ACCOMMODATE POSSIBLE CHANGES IN INVENTORY, BIDDERS WERE ALSO REQUIRED TO
BID A SEPARATE MONTHLY PRICE FOR MAINTAINING EACH TYPE OF POWERED
EQUIPMENT TO PERMIT ADJUSTMENTS DURING CONTRACT PERFORMANCE.
THREE BIDS WERE SUBMITTED BY THE JANUARY 10, 1983 OPENING DATE, TWO
BY THE PROTESTERS HERE, DYNETERIA AND THE TECOM, AND THE THIRD BY THE
INCUMBENT CONTRACT, MIDWEST MAINTENANCE & CONSTRUCTION. AS REPORTED BY
DYNETERIA, FN1 THE CORRECT BID PRICES ARE:
TECOM $3,095,566.00
DYNETERIA $4,003,977.48
MIDWEST $4,052,130.36
EVALUATION OF BIDS
THE CONTRACTING OFFICER REPORTS THAT HE BELIEVED THE SOLICITATION WAS
DEFECTIVE IN THREE AREAS. FIRST, HE STATES THAT THE INVENTORY OF GROUND
SUPPORT EQUIPMENT FAILED TO DIFFERENTIATE BETWEEN THE MODEL A-3 AND THE
MODEL MA-3 GAS AIR CONDITIONER AND BETWEEN THE MODEL 32C5 AND THE MODEL
MA-3M ELECTRIC AIR CONDITIONER. INSTEAD, THE INVENTORY SIMPLY INDICATED
TOTAL QUANTITIES FOR "A3/MA3 (GAS)" AND FOR "32C5/ MA-3M (ELECT)" AIR
CONDITIONERS. THE CONTRACTING OFFICER CONCLUDES THAT THIS DID NOT
PERMIT EVALUATION OF BIDS ON AN EQUAL BASIS BECAUSE THERE WAS NO
FEASIBLE METHOD FOR DETERMINING WHAT QUANTITY APPLIED TO EACH MODEL.
SECOND, THE CONTRACTING OFFICER VIEWS THE PAINTING PROVISIONS OF THE
SOLICITATION AS AMBIGUOUS BECAUSE THE STATED REQUIREMENT FOR PAINTING 25
PERCENT OF THE EQUIPMENT PER YEAR COULD BE MET BY PAINTING THE ENTIRE 25
PERCENT ON THE LAST DAY OF THE YEAR, RATHER THAN WHEN NEEDED, AS
INTENDED BY THE AIR FORCE. CONSEQUENTLY, THE CONTRACTING OFFICER
BELIEVES THAT THE PAINTING REQUIREMENT SHOULD HAVE BEEN PRORATED
THROUGHOUT THE YEAR AND REQUESTED BY A SEPARATE LINE ITEM. MOREOVER,
ACCORDING TO THE CONTRACTING OFFICER, THE 20,000 MANHOURS INDICATED FOR
UNSCHEDULED MAINTENANCE IN THE HISTORICAL DATA PORTION OF THE
SOLICITATION IS MISLEADING BECAUSE IT WAS BASED ON THE PRIOR CONTRACTUAL
REQUIREMENT FOR PAINTING 3 PERCENT OF THE EQUIPMENT PER YEAR, WHILE THE
PRESENT SOLICITATION REQUIRES PAINTING 25 PERCENT PER YEAR, AN INCREASE
OF 8,000 MANHOURS PER YEAR.
FINALLY, THE CONTRACTING OFFICER REPORTS THAT THE SOLICITATION FAILED
TO IDENTIFY TWO ACE AIR CONDITIONING UNITS THAT WERE INTENDED TO BE
COVERED BY THE CONTRACT. THE CONTRACTING OFFICER STATES THAT THESE UNITS
ARE LARGE, WEIGHING APPROXIMATELY 16,000 POUNDS, AND REQUIRE SPECIAL
TOWING OVER PUBLIC STREETS FOR MAINTENANCE IN AN OFF-BASE FACILITY. THE
CONTRACTING OFFICER BELIEVES THAT THESE UNITS SHOULD HAVE BEEN
IDENTIFIED IN THE SOLICITATION AND THE SPECIAL TOWING REQUIREMENTS
CLEARLY DEFINED.
ACCORDINGLY, THE CONTRACTING OFFICER DETERMINED THAT THE SOLICITATION
WAS DEFECTIVE AND THAT CANCELLATION WAS JUSTIFIED EVEN THOUGH BID PRICES
HAD BEEN EXPOSED. THE AIR FORCE SUBSEQUENTLY ISSUED A REVISED
SOLICITATION, BUT AWARD UNDER THAT SOLICITATION HAS BEEN WITHHELD
PENDING RESOLUTION OF THE INSTANT PROTEST.
ANALYSIS
ALTHOUGH A CONTRACTING OFFICER HAS BROAD DISCRETION IN CANCELING AN
INVITATION FOR BIDS, HE MUST HAVE A COMPELLING REASON TO DO SO AFTER BID
OPENING. DEFENSE ACQUISITION REGULATION SEC. 2-404.1 (1976 ED.). THE
FACT THAT SOME OF THE TERMS OF AN INVITATION ARE IN SOME WAY DEFICIENT
DOES NOT, OF ITSELF, CONSTITUTE A COMPELLING REASON TO CANCEL. OUR
OFFICE GENERALLY REGARDS CANCELLATION AFTER OPENING AS INAPPROPRIATE
WHEN OTHER BIDDERS WOULD NOT BE PREJUDICED BY AN AWARD UNDER THE
OSTENSIBLY DEFICIENT SOLICITATION, HILD FLOOR MACHINE CO., INC.,
B-196419, FEBRUARY 19, 1980, 80-1 CPD 140, AND WHEN SUCH AN AWARD WOULD
SERVE THE ACTUAL NEEDS OF THE GOVERNMENT. GAF CORPORATION, ET AL., 53
COMP.GEN. 586 (1974), 74-1 CPD 68. SEE ALSO MAC SERVICES, LTD., 61
COMP.GEN. 205 (1982), 82-1 CPD 46.
HERE, WE CONCLUDE THAT THE CONTRACTING OFFICER DID NOT HAVE A
COMPELLING REASON TO CANCEL. FIRST, IT IS NOT APPARENT WHY THE
CONTRACTING OFFICER CONCLUDED THAT THE FAILURE OF THE INVENTORY TO
DIFFERENTIATE BETWEEN TWO MODELS OF GAS AND OF ELECTRIC AIR CONDITIONERS
PRECLUDED EVALUATION OF BIDS ON AN EQUAL BASIS. THE MERE FACT THAT THE
INVENTORY COMBINED TWO IDENTIFIED MODELS OF COMPARABLE EQUIPMENT CANNOT
BE SAID TO HAVE CREATED AN AMBIGUITY, SINCE BIDDERS WERE CLEARLY
APPRISED OF THE FACT THAT THE QUANTITIES WERE SO COMBINED. IT MAY BE
THAT SEPARATELY IDENTIFYING THE QUANTITY OF EACH MODEL WOULD HAVE
PERMITTED BIDDERS TO MORE PRECISELY ESTIMATE THEIR COSTS WHEN PREPARING
THEIR FIXED PRICE FOR MAINTAINING THE GROUND SUPPORT EQUIPMENT.
HOWEVER, BIDDERS CAN TAKE SUCH RELATIVELY MINOR UNCERTAINTIES INTO
ACCOUNT IN COMPUTING THEIR BIDS; THE MERE PRESENCE OF RISK IN A
PROCUREMENT DOES NOT MAKE THE COMPETITION IMPROPER. INDUSTRIAL
MAINTENANCE SERVICES, INC., B-207949, SEPTEMBER 29, 1982, 82-2 CPD 296.
FURTHERMORE, THE FACT THAT NO BIDDER COMPLAINED LEADS US TO BELIEVE THAT
THE SMALL DEGREE OF UNCERTAINTY PRESENT HERE DID NOT CAUSE THE BIDDERS
ANY PROBLEM.
WITH RESPECT TO THE REQUIREMENT THAT BIDDERS INDICATE A UNIT PRICE
FOR THE MAINTENANCE OF EACH EQUIPMENT TYPE, THERE IS NO SUGGESTION IN
THE RECORD THAT BIDDERS WERE UNABLE TO CALCULATE THE REQUIRED PRICES BY
SPECIFIC MODEL NUMBER WITH THE INFORMATION AVAILABLE. IN ADDITION, BOTH
THE AIR FORCE LOGISTICS COMMAND AND THE HEADQUARTERS, U.S. AIR FORCE,
CONCEDE THAT ANY VARIATION IN PRICE RESULTING FROM THIS ALLEGED DEFECT
WOULD BE SLIGHT AND WOULD NOT WARRANT CANCELLATION OF THE SOLICITATION.
SECOND, THE RECORD DOES NOT SUPPORT THE CONTRACTING OFFICER'S
CONCLUSIONS CONCERNING THE PAINTING REQUIREMENT.
PAINTING IS INCLUDED WITHIN THAT PORTION OF THE SCOPE OF WORK
ENTITLED "UNSCHEDULED MAINTENANCE," WHICH IS DEFINED AS "CORRECTIVE
MAINTENANCE THAT IS REQUIRED TO MAINTAIN EQUIPMENT SERVICEABILITY
BETWEEN SCHEDULED MAINTENANCE." WHILE CERTAIN EQUIPMENT BREAKDOWNS ARE
REQUIRED TO BE REPAIRED WITHIN A SET NUMBER OF HOURS, THE SCOPE OF WORK
DOES NOT OTHERWISE SPECIFY THE TIMING OF UNSCHEDULED REPAIRS, SERVICES
AND MAINTENANCE REQUIRED UNDER THE CONTRACT. HOWEVER, WE THINK THE
CLEAR INTENT OF THE ENTIRE DOCUMENT IS THE MAINTENANCE OF THE GROUND
SUPPORT EQUIPMENT IN OPERATION, ON THE FLIGHT LINE, THROUGHOUT THE YEAR
ESSENTIALLY ON AN AS NEEDED BASIS. TO VIEW THE SCOPE OF WORK PROVISIONS
OTHERWISE WOULD PERMIT THE CONTRACTOR TO DRASTICALLY CURTAIL, IF NOT
CLOSE DOWN, FLIGHT LINE OPERATIONS BY TAKING ALL EQUIPMENT REQUIRING
PAINTING OR OTHER UNSCHEDULED MAINTENANCE AT THE SAME TIME, A RESULT
THAT HARDLY COULD BE INTENDED.
THUS, WE THINK THE ONLY FAIR READING OF THE SCOPE OF WORK PROVISION
STATING THAT THE AIR FORCE QUALITY ASSURANCE PERSONNEL WILL DESIGNATE
THOSE ITEMS OF EQUIPMENT TO BE PAINTED IS THAT THE DESIGNATION WILL TAKE
PLACE THROUGHOUT THE YEAR AND THAT THE CONTRACTOR WILL BE EXPECTED TO
RESPOND APPROPRIATELY THROUGHOUT THE YEAR; WE THINK IT IS UNREASONABLE
TO BELIEVE THAT A BIDDER WOULD HAVE READ THIS AS MEANING ANYTHING ELSE.
WE NOTE THAT THERE IS NO EVIDENCE IN THE RECORD WHICH SUPPORTS THAT ANY
BIDDER WAS MISLED WITH RESPECT TO THE FREQUENCY OF PAINTING.
ACCORDINGLY, WE THINK IT IS UNREASONABLE TO CONCLUDE THAT THE SCOPE OF
WORK PERMITTED THE CONTRACTOR TO POSTPONE ALL PAINTING UNTIL THE LAST
DAY OF THE CONTRACT.
WITH RESPECT TO THE SUPPOSED MISLEADING NATURE OF THE HISTORICAL DATA
IN THE SOLICITATION, THE RECORD INDICATES THAT WHATEVER AMBIGUITY MIGHT
HAVE EXISTED IN THIS REGARD WAS ELIMINATED AT THE BIDDERS' CONFERENCE.
AS REPORTED IN THE MATERIALS PROVIDED TO THE BIDDERS WITH SOLICITATION
AMENDMENT 0002, THE FOLLOWING EXCHANGE TOOK PLACE AT THE CONFERENCE:
"Q: DO THE HOURS IN TECHNICAL EXHIBIT 9 FOR
UNSCHEDULED MAINTENANCE INCLUDE PAINTING/CORROSION
CONTROL?
A: YES, HOWEVER, PRESENT CONTRACT REQUIRES
3 PERCENT PAINTING. NEW SOLICITATION REQUIRES 25
PERCENT PAINTING ...."
WE BELIEVE THIS STATEMENT SHOULD HAVE PLACED ALL BIDDERS ON NOTICE THAT
THE HISTORICAL DATA FOR UNSCHEDULED MAINTENANCE WAS BASED ON A MUCH
SMALLER PAINTING REQUIREMENT THAN WHAT WAS CALLED FOR BY THE NEW
PROCUREMENT.
THIRD, WE FIND NO MERIT TO THE ASSERTION THAT THE SOLICITATION WAS
DEFICIENT BECAUSE THE INVENTORY FAILED TO INCLUDE THE TWO ACE AIR
CONDITIONERS. THE CONTRACTING OFFICER ORIGINALLY CONCLUDED THAT ADDING
THE ACE AIR CONDITIONERS TO THE EXISTING CONTRACT WOULD "INSUPERABLY
ALTER ANY BIDS SUBMITTED" BECAUSE OF EACH ITEM'S SIZE AND WEIGHT, ABOUT
16,000 POUNDS, AND THE CONSEQUENT NEED TO PERFORM ALL MAINTENANCE ON THE
ITEMS IN THE CONTRACTOR'S OFF-SITE FACILITY. FN2 ACCORDING TO THE
CONTRACTING OFFICER, THIS WOULD REQUIRE AN ADEQUATE TOWING VEHICLE,
PROPERLY EQUIPPED IN ACCORDANCE WITH STATE LAW FOR TOWING LOADS IN
EXCESS OF 3,000 POUNDS OVER PUBLIC HIGHWAYS. CONSEQUENTLY, THE
CONTRACTING OFFICER BELIEVED HE COULD NOT AWARD A CONTRACT THAT INCLUDED
THE TWO UNITS UNLESS THE SOLICITATION IDENTIFIED THE ACE AIR
CONDITIONERS AND SPECIFIED THE NEED FOR AN ADEQUATE "STREET LEGAL"
TOWING VEHICLE.
WE FIND THESE REASONS TO BE UNPERSUASIVE. DYNETERIA POINTS OUT THAT
WHILE THE ACE AIR CONDITIONERS ARE LARGE, THEY ARE ONLY SLIGHTLY LARGER
THAN A FULL-SIZED STATION WAGON AND THAT THE 12,000 SQUARE FEET OF
BUILDING SPACE AVAILABLE TO THE CONTRACTOR ON-SITE COULD ACCOMMODATE
THEM FOR ALL MAINTENANCE EXCEPT REPAINTING, WHICH WOULD OCCUR ONLY ONCE
DURING THE 3-YEAR LIFE OF THE CONTRACT. IN REBUTTAL, THE CONTRACTING
OFFICER APPEARS TO CONCEDE THAT THE ON-SITE BUILDING COULD INDEED
ACCOMMODATE THESE AIR CONDITIONERS BUT ARGUES THAT IT WOULD CREATE
CONSIDERABLE CONGESTION IN THE BUILDING AND THAT IT WOULD REQUIRE
RELOCATION OF OTHER EQUIPMENT.
RELOCATING OTHER WHEELED ITEMS OF GROUND SUPPORT EQUIPMENT, HOWEVER,
DOES NOT APPEAR TO BE OUTSIDE THE SCOPE OF THE CONTRACT. SINCE THE
CONTRACT COVERS MORE THAN 800 ITEMS OF GROUND SUPPORT EQUIPMENT, IT IS
APPARENT THAT THE CONTRACTOR FREQUENTLY WILL BE CALLED UPON TO RELOCATE
ITEMS IN AND OUT OF THE ON-SITE BUILDING. ALTHOUGH MORE THAN THE USUAL
EQUIPMENT RELOCATION MIGHT BE NECESSARY TO ACCOMMODATE THE ACE UNITS AND
AVOID UNDUE CONGESTION IN THE BUILDING, IN THE TOTAL CONTEXT OF THIS
CONTRACT SUCH ACTION WOULD SEEM TO BE NOTHING EXTRAORDINARY IN TERMS OF
CONTRACTOR EFFORT AND EXPENSE. THUS, TOWING TO THE OFF-SITE FACILITY
WOULD NOT APPEAR TO BE NECESSARY TO THE EXTENT ENVISIONED BY THE
CONTRACTING OFFICER.
MOREOVER, TO THE EXTENT TOWING OF THE ACE AIR CONDITIONERS TO THE
OFF-SITE FACILITY IS NECESSARY, I.E., WHEN REPAINTING IS NECESSARY
(WHICH SHOULD ONLY OCCUR ONCE FOR EACH AIR CONDITIONER DURING THE 3 YEAR
LIFE OF THE CONTRACT) OR IF THE CONTRACTOR PREFERS TO PERFORM OTHER
MAINTENANCE AT THE OFF-SITE FACILITY RATHER THAN IN THE ON-SITE
BUILDING, NO UNIDENTIFIED SPECIAL BURDEN WILL BE PLACED ON THE
CONTRACTOR. AS NOTED EARLIER, THE CONTRACTING OFFICER REPORTS THAT
STATE LAW REQUIRES THE USE OF AN APPROPRIATELY EQUIPPED TOWING VEHICLE
FOR UNITS WEIGHING IN EXCESS OF 3,000 POUNDS. THE ACE UNITS ARE NOT THE
ONLY ONES THAT WEIGH THAT MUCH - THE CONTRACTING OFFICER'S REPORT
INDICATES THAT AT LEAST ONE OTHER TYPE OF GROUND SUPPORT EQUIPMENT
LISTED IN THE ORIGINAL INVENTORY WEIGHS WELL IN EXCESS OF 3,000 POUNDS.
THEREFORE, BIDDERS WERE ON NOTICE THAT THEY WOULD BE REQUIRED TO TOW
SUCH LOADS OVER PUBLIC HIGHWAYS EVEN WITHOUT THE LISTING OF THE ACE AIR
CONDITIONERS. CONSEQUENTLY, WE CANNOT AGREE THAT THE AIR CONDITIONERS
ARE SO DIFFERENT FROM THE OTHER ITEMS OF EQUIPMENT THAT BIDDERS WOULD
NOT BE PREPARED TO HANDLE THEM SHOULD THEY BE INCLUDED IN THE CONTRACT.
FURTHER, WE NOTE THAT THE ACE AIR CONDITIONERS WOULD ADD JUST 2 ITEMS
TO AN EXISTING INVENTORY OF 884 PIECES OF GROUND SUPPORT EQUIPMENT, AND
THAT MAINTENANCE OF GROUND SUPPORT EQUIPMENT IS JUST ONE OF A NUMBER OF
SERVICES THE CONTRACTOR IS TO PERFORM. JUDGING FROM THE VERY LIMITED
DIFFERENCES AMONG THE BIDDERS FOR MAINTAINING THE ACE AIR CONDITIONERS
DISCLOSED BY THE RESOLICITATION, THE RELATIVE ORDER OF THE BIDS ON THE
ORIGINAL SOLICITATION WOULD HAVE REMAINED THE SAME IF THE ACE AIR
CONDITIONERS HAD BEEN INCLUDED IN THE ORIGINAL SOLICITATION. FN3
ACCORDINGLY, WE BELIEVE THAT ADDING THESE TWO ITEMS TO THE CONTRACTOR
SELECTED UNDER THE ORIGINAL INVITATION WOULD HAVE ONLY A TRIVIAL EFFECT
UPON THE BASIS FOR THE ORIGINAL COMPETITION, AND DOES NOT CONSTITUTE AN
ADEQUATE BASIS FOR CANCELLATION OF THAT SOLICITATION.
UNDER THE CIRCUMSTANCES, WE FIND THAT THE CONTRACTING OFFICER DID NOT
HAVE A COGENT AND COMPELLING REASON TO CANCEL THE SOLICITATION.
THEREFORE, THE PROTEST IS SUSTAINED. WE ARE RECOMMENDING TO THE
SECRETARY OF THE AIR FORCE THAT THE CONTRACT BE AWARDED TO THE LOW
RESPONSIVE, RESPONSIBLE BIDDER UNDER THE ORIGINAL SOLICITATION.
FN1 ALTHOUGH THESE PRICES DIFFER FROM THOSE ON THE BID ABSTRACT, THE
AIR FORCE OFFERS NO EXPLANATION, OBJECTION OR INDICATION OF WHAT IT
BELIEVES THE CORRECT PRICES SHOULD BE.
FN2 THE SOLICITATION REQUIRED THE CONTRACTOR TO MAINTAIN SUCH A
FACILITY FOR PAINTING, SANDBLASTING, AND "OVERFLOW MAINTENANCE."
FN3 AS NOTED EARLIER, BIDDERS WERE REQUIRED TO PROVIDE MAINTENANCE
PRICES FOR EACH ITEM, ON A MONTHLY BASIS, TO PERMIT PRICE ADJUSTMENTS TO
REFLECT CHANGES IN INVENTORY DURING PERFORMANCE. THE TOTAL OF THESE
MONTHLY PRICES TIMES THE NUMBER OF EACH ITEM IN INVENTORY HAD TO EQUAL
THE TOTAL PRICE BID, SO BIDDERS WOULD HAVE BEEN FORCED TO MAKE SPECIFIC
PRICE ADJUSTMENT, NOT SIMPLY A MANAGEMENT JUDGMENT, IF THE AIR
CONDITIONERS HAD BEEN ADDED. THESE CIRCUMSTANCES, TOGETHER WITH THE
MONTHLY PRICES ACTUALLY BID FOR MAINTAINING THE ACE AIR CONDITIONERS ON
RESOLICITATION, PERMIT A PRECISE CALCULATION OF THE IMPACT THAT ADDING
THE AIR CONDITIONERS WOULD HAVE UPON THE ORIGINAL BID PRICES, A
CALCULATION NOT POSSIBLE IN THE ORDINARY CASE.
B-210681, AUG 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE IMPROPER GOVERNMENT ACTION
(MISDIRECTION OF BIDDER BY AUTHORIZED
REPRESENTATIVE OF CONTRACTING OFFICER)
IS THE PARAMOUNT CAUSE FOR A BID BEING
TIME-STAMPED 1 MINUTE AFTER BID OPENING,
AND NO OTHER BIDS HAD BEEN OPENED, LATE
LOW BID WAS PROPERLY ACCEPTED.
BAETEN CONSTRUCTION CO.:
BAETEN CONSTRUCTION CO. (BAETEN) PROTESTS THE GENERAL SERVICES
ADMINISTRATION (GSA) CONSIDERATION OF THE LATE LOW BID OF CORONADO
CORPORATION (CORONADO) SUBMITTED ON PROJECT NO. R-CO-81-132.
WE DENY THE PROTEST.
THE INVITATION FOR BIDS, AS AMENDED, SET BID OPENING DATE FOR
DECEMBER 28, 1982, AT 1:30 P.M. BIDS WERE TO BE RECEIVED AT THE
BUSINESS SERVICE CENTER (BSC), BUILDING 41, DENVER FEDERAL CENTER. THE
BSC WAS RELOCATED FROM THE FIRST TO THE SECOND FLOOR OF BUILDING 41 ONLY
A FEW DAYS BEFORE THE CHRISTMAS HOLIDAY. WHEN THIS WAS DISCOVERED BY
THE CONTRACTING OFFICER ON THE MORNING OF BID OPENING, IT WAS DECIDED
THAT THE BIDS WERE TO BE RECEIVED AND TIME-STAMPED IN THE NEW BSC AND
OPENED IN THE SOUTH DAKOTA ROOM ON THE SAME FLOOR. TO NOTIFY BIDDERS OF
THE NEW BSC LOCATION, GSA PLACED THREE TEMPORARY, HAND-DRAWN, SIGNS WITH
INSTRUCTIONS AND DIAGRAMS ON THE FIRST FLOOR. NO SIGN OR NUMBER WAS
PLACED AT THE BSC IDENTIFYING IT, AND THE PERMANENT SIGNS IDENTIFYING
THE ORIGINAL FIRST FLOOR BSC REMAINED. THE CONTRACTING OFFICER DIRECTED
A PROCUREMENT ASSISTANT TO ASSIST THE BIDDERS.
ACCORDING TO THE PROCUREMENT ASSISTANT, SHE INTERCEPTED THE CORONADO
REPRESENTATIVE ABOUT 15 FEET FROM THE NEW BSC AT ABOUT 1 MINUTE PRIOR TO
BID OPENING. BECAUSE SHE WAS UNDER THE MISTAKEN IMPRESSION THAT BIDS
WERE TO BE RECEIVED, AS OPPOSED TO OPENED, IN THE SOUTH DAKOTA ROOM, SHE
REDIRECTED THE BIDDER TO THAT ROOM DESPITE THE REPRESENTATIVE'S
STATEMENT THAT HE HAD ALREADY BEEN THERE AND WAS DIRECTED TO THE NEW
BSC. WHEN THEY ENTERED THE SOUTH DAKOTA ROOM, A PROCUREMENT CLERK
ADVISED THAT THE TIME STAMP WAS IN THE NEW BSC AND, AFTER LOCATING IT,
THE CORONADO BID WAS TIME-STAMPED AT 1:31 P.M., 1 MINUTE LATE. NONE OF
THE OTHER BIDS HAD BEEN OPENED.
THE CONTRACTING OFFICER CONCLUDED THAT, BECAUSE OF THESE
CIRCUMSTANCES, THE CORONADO BID WAS LATE DUE TO MISDIRECTION BY AN
AUTHORIZED GOVERNMENT REPRESENTATIVE. THE CORONADO BID WAS CONSIDERED
AND AWARD MADE TO CORONADO.
A BIDDER HAS THE RESPONSIBILITY OF ASSURING THE TIMELY ARRIVAL OF ITS
BID TO THE PLACE DESIGNATED IN THE SOLICITATION. HOWEVER, A HAND-CARRIED
BID WHICH IS RECEIVED LATE MAY BE ACCEPTED WHERE IMPROPER GOVERNMENT
ACTION WAS THE PARAMOUNT CAUSE FOR THE LATE DELIVERY AND CONSIDERATION
OF THE LATE BID WOULD NOT COMPROMISE THE INTEGRITY OF THE COMPETITIVE
BIDDING SYSTEM. IMPROPER GOVERNMENT ACTION MAY BE MISDIRECTION CAUSED
BY GOVERNMENT PERSONNEL, SOLICITATION INSTRUCTIONS, OR BUILDING SIGNS.
A MISDIRECTED LATE BID MAY BE CONSIDERED SO LONG AS THE BIDDER ACTED
REASONABLY AND DID NOT SIGNIFICANTLY CONTRIBUTE TO THE LATENESS. DALE
WOODS, B-209459, APRIL 13, 1983, 83-1 CPD 396, AND CASES CITED THEREIN.
THE PROTESTER HAS SUBMITTED EVIDENCE TO SHOW THAT CORONADO
SIGNIFICANTLY CONTRIBUTED TO THE LATENESS OF THE BID. SPECIFICALLY, THE
OTHER FIVE BIDDERS WERE ABLE TO DELIVER TIMELY BIDS BY ASCERTAINING THE
LOCATION OF THE NEW BSC, AND BIDDERS, OTHER THAN THE PROTESTER, STATE
THAT CORONADO'S REPRESENTATIVE ENTERED THE SOUTH DAKOTA ROOM AFTER THE
BID OPENING TIME. ALSO, THE PROTESTER NOTES THAT CORONADO'S VERSION OF
THE EVENTS OF THAT DAY CONFLICTS WITH THE OTHERS.
DESPITE THIS, NOTHING SUBMITTED CONTRADICTS THE GOVERNMENT'S POSITION
THAT, PRIOR TO OPENING, THE PROCUREMENT ASSISTANT, SPECIFICALLY
AUTHORIZED BY THE CONTRACTING OFFICER TO ASSIST BIDDERS, MISDIRECTED THE
CORONADO REPRESENTATIVE. FURTHERMORE, IT APPEARS THAT THE TIME CONSUMED
BY THE MISDIRECTION CONVERTED WHAT WOULD HAVE BEEN A TIMELY BID INTO A
LATE BID. THIS IS BECAUSE THE MISDIRECTION OCCURRED JUST OUTSIDE THE
NEW BSC WHERE BIDS WERE TO BE STAMPED AND WHERE CORONADO'S
REPRESENTATIVE WAS HEADING. FROM THIS, WE CONCLUDE THAT TIMELY BID
SUBMISSION WAS IMMINENT. THEREFORE, THE PROTESTER HAS SHOWN NO EVIDENCE
THAT THE GOVERNMENT'S ACTION WAS NOT THE PARAMOUNT CAUSE FOR THE BID
BEING LATE.
CONSIDERATION OF CORONADO'S BID WOULD NOT COMPROMISE THE INTEGRITY OF
THE COMPETITIVE BIDDING SYSTEM. NONE OF THE BIDS HAD BEEN OPENED WHEN
THE CORONADO BID WAS TIME-STAMPED; CORONADO WOULD NOT HAVE HAD THE
OPPORTUNITY TO ALTER ITS BID. L.V. ANDERSON & SONS, INC., B-189835,
SEPTEMBER 30, 1977, 77-2 CPD 249.
SINCE THE GOVERNMENT'S ACTION CAUSED CORONADO'S BID TO BE LATE AND
ACCEPTANCE OF THE LATE BID DID NOT COMPROMISE THE INTEGRITY OF THE
COMPETITIVE BIDDING SYSTEM, THE PROTEST IS DENIED. THEREFORE, BAETEN'S
CLAIM FOR DAMAGES, INCLUDING LOST PROFITS, ATTORNEY'S FEES, AND OTHER
COSTS, WHICH WOULD BE LIMITED TO BID PREPARATION COSTS IN ANY EVENT, IS
DENIED. HUB TESTING LABORATORIES - CLAIM FOR COSTS, B-199368.3, JUNE 18,
1982, 82-1 CPD 602; AMERICAN SHIPBUILDING COMPANY, B-207218;
B-207218.2, NOVEMBER 9, 1982, 82-2 CPD 424.
B-210680.2, JUN 28, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTESTER FAILS TO CARRY HIS BURDEN OF PROVING THAT CONTRACTING
OFFICIALS ACTED WITHOUT A REASONABLE BASIS OR IN BAD FAITH IN REQUIRING
PERFORMANCE AND PAYMENT BONDS WHERE THE RECORD REVEALS THAT THE
CONTRACTING OFFICIALS DETERMINED IN GOOD FAITH THAT THE BONDS WERE
NECESSARY TO PROTECT THE GOVERNMENT'S INTEREST IN THE CONSIDERABLE
QUANTITY OF VALUABLE GOVERNMENT PROPERTY WHICH WILL BE PROVIDED TO THE
CONTRACTOR FOR USE IN PERFORMING THE CONTRACT.
WRIGHT'S AUTO REPAIR & PARTS, INC.:
WRIGHT'S AUTO REPAIR AND PARTS, INC., PROTESTS THE REQUIREMENT FOR
PERFORMANCE AND PAYMENT BONDS IN INVITATION FOR BIDS NO.
N62477-82-B-8825, ISSUED BY THE DEPARTMENT OF THE NAVY'S DAVID W.
TAYLOR NAVAL SHIP RESEARCH AND DEVELOPMENT CENTER FOR THE OPERATION AND
MAINTENANCE OF VEHICLES AND EQUIPMENT FOR RIGGING AND LOAD LIFTING AT
THE CENTER'S ANNAPOLIS AND BETHESDA, MARYLAND FACILITIES. WE DENY THE
PROTEST.
IFB -8825 REQUIRED THE LOW BIDDER TO PROVIDE A PERFORMANCE BOND IN AN
AMOUNT EQUAL TO 100 PERCENT OF THE CONTRACT PRICE AND A PAYMENT BOND IN
AN AMOUNT EQUAL TO 50 PERCENT OF THE CONTRACT PRICE, UNLESS THAT PRICE
WAS MORE THAN $1 MILLION AND LESS THAN $5 MILLION, IN WHICH CASE THE
AMOUNT OF THE PAYMENT BOND NEED ONLY EQUAL 40 PERCENT OF THE CONTRACT
PRICE. PRIOR TO BID OPENING, WRIGHT'S PROTESTED THE REQUIREMENT OF
PERFORMANCE AND PAYMENT BONDS TO OUR OFFICE.
WRIGHT'S ALLEGES THAT THE BOND REQUIREMENT IS BEING USED HERE AS A
SUBSTITUTE FOR A DETERMINATION OF CONTRACTOR RESPONSIBILITY IN VIOLATION
OF DEFENSE ACQUISITION REGULATION (DAR) SEC. 10-104.2 (1976 ED.).
WRIGHT'S FURTHER ARGUES THAT THE BOND REQUIREMENT RESULTS IN AN
UNNECESSARY EXPENSE FOR THE GOVERNMENT BECAUSE THE PROVISIONS IN THE IFB
FOR LIQUIDATED DAMAGES AND FOR DEDUCTIONS FROM GOVERNMENT PAYMENTS TO
THE CONTRACTOR FOR NONPERFORMANCE OR UNSATISFACTORY PERFORMANCE,
TOGETHER WITH A PROPER DETERMINATION OF CONTRACTOR RESPONSIBILITY,
PROVIDE SUFFICIENT PROTECTION FOR THE GOVERNMENT. WRIGHT'S ALSO
CONTENDS THAT ANY DECISION BASED UPON THE RECORD PRESENTED BY THE NAVY
LACKS A RATIONAL BASIS SINCE THE DOCUMENTS DO NOT REVEAL ANY
CONSIDERATION OF ALTERNATIVES SUCH AS REQUIRING A PERFORMANCE BOND EQUAL
TO LESS THAN 100 PERCENT OF THE CONTRACT PRICE.
THE NAVY DENIES THAT IMPOSITION OF A BOND REQUIREMENT WAS IMPROPER.
THE NAVY INSTEAD ADOPTS THE POSITION OF THE CONTRACTING OFFICIALS WHO
APPROVED THE BOND REQUIREMENT AND CONTENDS THAT THE BOND REQUIREMENT WAS
NECESSARY IN ORDER TO PROTECT THE GOVERNMENT'S INTEREST IN THE VERY
LARGE QUANTITY OF COSTLY GOVERNMENT-OWNED TOOLS, TRUCKS, AND WEIGHT- AND
MATERIALS-HANDLING EQUIPMENT WHICH WOULD BE SUPPLIED TO THE CONTRACTOR
FOR USE IN PERFORMING THE CONTRACT.
DAR SEC. 10-104.2(A) PROVIDES THAT:
"(A) PERFORMANCE BONDS SHALL NOT BE
USED AS A SUBSTITUTE FOR DETERMINATIONS OF
CONTRACTOR RESPONSIBILITY ***. SUBJECT
TO THIS GENERAL POLICY, PERFORMANCE BONDS
MAY BE REQUIRED IN INDIVIDUAL PROCUREMENTS
WHEN, CONSISTENT WITH THE FOLLOWING CRITERIA,
THE CONTRACTING OFFICER DETERMINES
THE NEED THEREFORE. JUSTIFICATION FOR ANY
SUCH REQUIREMENT MUST BE FULLY DOCUMENTED.
(I) WHEN THE TERMS OF THE CONTRACT PROVIDE
FOR THE CONTRACTOR TO HAVE THE USE OF GOVERNMENT
MATERIAL, PROPERTY OR FUNDS AND FURTHER PROVIDE
FOR THE HANDLING THEREOF BY THE CONTRACTOR IN A
SPECIFIED MANNER, A PERFORMANCE BOND SHALL BE
REQUIRED IF NEEDED TO PROTECT THE GOVERNMENT'S INTEREST." AS FOR
PAYMENT BONDS, DAR SEC. 10-104.3 PROVIDES THAT, "IF A PERFORMANCE BOND
IS REQUIRED A PAYMENT BOND SHOULD ALSO BE REQUIRED IF IT CAN BE OBTAINED
AT NO ADDITIONAL COST."
CONTRACTING OFFICERS HAVE DISCRETION TO DETERMINE WHETHER A NEED
EXISTS UNDER DAR SECS. 10-104.2 AND 10-104.3 FOR PERFORMANCE AND PAYMENT
BONDS IN A PARTICULAR PROCUREMENT. THEREFORE, WHERE THE DECISION TO
REQUIRE BONDS IS FOUND TO BE REASONABLE AND MADE IN GOOD FAITH, WE WILL
NOT DISTURB THE AGENCY'S DETERMINATION. CANTU SERVICES, INC., B-208317,
NOVEMBER 2, 1982, 82-2 CPD 401. FURTHER, THE PROTESTER BEARS THE BURDEN
OF DEMONSTRATING THAT THE DECISION TO REQUIRE THE BONDS WAS UNREASONABLE
OR MADE IN BAD FAITH. SEE WILLIAM P. JOLLEY, B-207982, NOVEMBER 9,
1982, 82-2 CPD 426.
WRIGHT'S HAS FAILED TO SHOW THAT THE REQUIREMENT OF A PERFORMANCE
BOND IS BEING USED HERE AS A SUBSTITUTE FOR A DETERMINATION OF
CONTRACTOR RESPONSIBILITY INSTEAD OF AS A MEASURE TO PROTECT GOVERNMENT
PROPERTY.
UNDER THIS CONTRACT, THE CONTRACTOR WOULD PERFORM FOR TWO NAVY
INSTALLATIONS:
"*** THE COMPLETE FUNCTIONS OF OPERATING
AND MAINTAINING MOTOR VEHICLES, MATERIALS
HANDLING EQUIPMENT, WEIGHT HANDLING EQUIPMENT
AND CONSTRUCTION AND OTHER EQUIPMENT,
PERFORMANCE OF RELATED TRANSPORTATION
MANAGEMENT FUNCTIONS, AND COMPLETE RIGGING,
LOAD LIFTING, FURNITURE AND EQUIPMENT
MOVING SERVICES ***." IN THE PERFORMANCE OF THE CONTRACT, THE
CONTRACTOR WOULD USE GOVERNMENT-FURNISHED SHOP TOOLS AND VEHICLE REPAIR
EQUIPMENT AND RIGGING GEAR; MAINTAIN AND OPERATE A LARGE FLEET OF
VEHICLES; REMOVE SNOW AND ICE FROM ROADS AND SIDEWALKS; MAINTAIN,
TEST, REPAIR AND OPERATE CERTAIN WEIGHT-HANDLING EQUIPMENT AND RIGGING
GEAR; AND TEST CERTAIN LIFTING DEVICES. A CONSIDERABLE AMOUNT OF
VALUABLE GOVERNMENT EQUIPMENT AND VEHICLES, THEREFORE, WILL BE PROVIDED
TO THE CONTRACTOR FOR USE IN PERFORMING THE CONTRACT. WE HAVE
PREVIOUSLY CONCLUDED THAT WHERE A CONSIDERABLE AMOUNT OF GOVERNMENT
PROPERTY WILL BE PROVIDED FOR USE BY THE CONTRACTOR, THEN THE
CONTRACTING OFFICALS, UNDER DAR SEC. 10-104.2(A)(I), HAVE A REASONABLE
BASIS FOR DECIDING TO IMPOSE A PERFORMANCE BOND REQUIREMENT. WILLIAM P.
JOLLEY, SUPRA; CANTU SERVICES, INC., B-208316, OCTOBER 25, 1982, 82-2
CPD 366.
WRIGHT'S NOTES THAT THE GOVERNMENT MAY MAKE DEDUCTIONS FROM THE
CONTRACTOR'S INVOICES FOR WORK WHICH IS UNSATISFACTORILY PERFORMED OR
NOT PERFORMED, PLUS IMPOSE LIQUIDATED DAMAGES IN THE AMOUNT OF 10
PERCENT FOR UNSATISFACTORY WORK OR 20 PERCENT FOR WORK NOT PERFORMED, TO
COMPENSATE THE GOVERNMENT FOR THE ADDITIONAL ADMINISTRATIVE COSTS
INCURRED. WRIGHT'S MAINTAINS THAT THOSE PROVISIONS SUFFICIENTLY PROTECT
THE GOVERNMENT'S INTEREST SO AS TO MAKE THE BOND REQUIREMENT
UNNECESSARY.
WE DISAGREE.
THE SCHEDULE OF DEDUCTIONS PROVIDES AN INCENTIVE FOR THE CONTRACTOR
TO PERFORM WELL BY REDUCING THE AMOUNT TO BE PAID TO THE CONTRACTOR ON
THOSE OCCASIONS WHEN IT FAILS TO PERFORM OR PERFORMS UNSATISFACTORILY.
IT ALSO ESTABLISHES AT THE OUTSET OF THE CONTRACT THE AMOUNT BY WHICH
PAYMENT IS TO BE REDUCED FOR SUBSTANDARD SERVICE, RATHER THAN BURDEN THE
ADMINISTRATION OF THE CONTRACT WITH THE NECESSITY FOR RESOLVING THAT
ISSUE EACH TIME A DEFICIENCY OCCURES. THE PURPOSE OF THE SCHEDULE OF
DEDUCTIONS, THEREFORE, DIFFERS FROM THAT OF THE PERFORMANCE BOND, WHICH
IS DESIGNED TO PROTECT THE GOVERNMENT IN THE EVENT OF A MORE SERIOUS
FAILURE OF THE CONTRACTOR TO PERFORM.
SINCE THE RECORD CLEARLY INDICATES THAT THE CONTRACTING OFFICIALS
INCLUDED THE BONDING REQUIREMENT IN THE IFB IN ORDER TO PROTECT THE
GOVERNMENT'S INTEREST IN THE CONSIDERABLE, VALUABLE GOVERNMENT PROPERTY
WHICH WOULD BE PROVIDED FOR USE BY THE CONTRACTOR, WE CONCLUDE THAT THE
NAVY HAS SATISFIED THE REQUIREMENT OF DAR SEC. 10-104.2(A) THAT THE
JUSTIFICATION FOR ANY BOND REQUIREMENT MUST BE FULLY DOCUMENTED.
WRIGHT'S HAS FAILED TO DEMONSTRATE THAT CONTRACTING OFFICIALS ACTED
ARBITRARILY OR IN BAD FAITH IN IMPOSING A PERFORMANCE BOND REQUIREMENT.
SINCE WE WILL THEREFORE NOT QUESTION THE REQUIREMENT OF A PERFORMANCE
BOND HERE, NEITHER WILL WE QUESTION THE REQUIREMENT OF A PAYMENT. BOND.
SEE A.R.&S. ENTERPRISES, INC., B-201924, JULY 7, 1981, 81-2 CPD 14.
THE PROTEST IS DENIED.
B-210679, B-211005, MAY 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO WILL NOT OBJECT TO DEFINITIVE RESPONSIBILITY REQUIREMENT IN
SOLICITATION FOR BASIC SKILLS EDUCATION PROGRAMS FOR MILITARY TRAINEES,
THAT CONTRACTOR BE ACCREDITED EDUCATIONAL INSTITUTION, SINCE THE
CONTRACTING AGENCY'S VIEW THAT THE REQUIREMENT IS NEEDED TO ASSURE
QUALITY INSTRUCTIONAL PROGRAMS IS REASONABLE.
2. JOINT VENTURE COMPOSED OF AN ACCREDITED EDUCATIONAL INSTITUTION
AND A MANAGING VENTURER WHICH IS NOT ACCREDITED DOES NOT MEET THE
SOLICITATION REQUIREMENT FOR CONTRACTOR THE JOINT VENTURE WOULD
FRUSTRATE THE INTENT OF REQUIREMENT, ACCREDITATION, SINCE IMPUTING THE
ACCREDITED FIRM'S STATUS TO WHICH IS TO INSURE THAT EDUCATIONAL PROGRAMS
ARE MANAGED BY ACCREDITED INSTITUTIONS.
LOYOLA COLLEGE AND NONPUBLIC EDUCATIONAL SERVICES, INC., A JOINT
VENTURE; JOHNSON & WALES COLLEGE:
LOYOLA COLLEGE AND NONPUBLIC EDUCATIONAL SERVICES, INC., A JOINT
VENTURE (LOYOLA/NONPUBLIC), HAS PROTESTED THE REJECTION OF A NUMBER OF
ITS BIDS AND PROPOSALS TO PROVIDE EDUCATIONAL SERVICES TO THE DEPARTMENT
OF THE ARMY. JOHNSON & WALES COLLEGE HAS PROTESTED THE AWARD OF A
CONTRACT AND A POTENTIAL AWARD TO LOYOLA/NONPUBLIC FOR SIMILAR SERVICES.
ALL OF THESE PROCUREMENTS WERE RESTRICTED TO REGIONALLY OR NATIONALLY
ACCREDITED EDUCATIONAL INSTITUTIONS IN ACCORDANCE WITH ARMY REGULATION
(AR) 621-5, PARAGRAPH 2-8.D, OCTOBER 15, 1981. ALTHOUGH LOYOLA IS DULY
ACCREDITED, NONPUBLIC AND LOYOLA/ NONPUBLIC ARE NOT. IN ALL CASES WHERE
LOYOLA/NONPUBLIC IS THE PROTESTER, THE ARMY DETERMINED THAT THE JOINT
VENTURE'S BIDS AND PROPOSALS COULD NOT BE ACCEPTED BECAUSE THE ISSUE IN
ALL CASES IS THE PROPRIETY OF THE REJECTIONS OR ACCEPTANCES OF THE BIDS
AND PROPOSALS OF THE JOINT VENTURE. THE PROTESTS THEREFORE HAVE BEEN
COMBINED FOR PURPOSES OF THIS DECISION.
WE BELIEVE LOYOLA/NONPUBLIC PROPERLY HAS BEEN FOUND NONRESPONSIBLE.
FN1
THE PROTESTS PERTAIN TO BOTH INVITATIONS FOR BIDS (IFBS) AND REQUESTS
FOR PROPOSALS (RFPS) THAT SOLICITED BIDS OR OFFERS TO PROVIDE
INSTRUCTION AND RELATED SERVICES IN CONNECTION WITH BASIC SKILLS
EDUCATION PROGRAMS (BSEP) I AND II. THE SPECIFIC PROCUREMENTS ARE AS
FOLLOWS:
1. B-205994.2: RFP NO. DAAH03-82-R-0041 ISSUED BY
REDSTONE ARSENAL.
2. B-209501: RFP NO. DABT35-82-R-1023 ISSUED BY
FORT DIX.
3. B-209291: RFP NO. DABT57-82-R-0056 ISSUED BY
FORT STORY, RFP NO. DABT57-82-R-0065 ISSUED BY FORT
EUSTIS, AND IFB NO. DABT10-82-B-0106 ISSUED BY FORT
BENNING. 2
4. B-208528.2: IFB NO. DABT31-82-B-0088 ISSUED BY
FORT LEONARD WOOD.
5. B-209357: IFB NO. DAKF31-82-B-0090 ISSUED BY
FORT DEVENS.
6. B-209432: IFB NO. DAKF49-82-B-0073 ISSUED BY
FORT SAM HOUSTON. LOYOLA/NONPUBLIC WAS AWARDED THE
CONTRACT AND JOHNSON & WALES PROTESTED. THE ARMY
STATES THAT AWARD TO THE JOINT VENTURE WAS A MISTAKE
AND ALTHOUGH IT DOES NOT INTEND TO TERMINATE THE
CONTRACT, IT HAS INSTRUCTED THE PROCURING AGENCY NOT
TO EXERCISE THE OPTION TO EXTEND PERFORMANCE.
7. B-210679: IFB NO. DAKF36-83-B-0004 ISSUED BY
FORT DRUM. LOYOLA/NONPUBLIC IS THE APPARENT LOW BIDDER
AND JOHNSON & WALES HAS PROTESTED AWARD TO ANY BIDDER
OTHER THAN ITSELF.
8. B-211005: IFB NO. DAKF40-83-B-0030 ISSUED BY
FORT BRAGG. LOYOLA/NONPUBLIC WAS THE LOW BIDDER,
AND CENTRAL TEXAS COLLEGE WAS THE SECOND LOW BIDDER.
THE ARMY, LOYOLA/NONPUBLIC AND CENTRAL TEXAS COLLEGE
HAVE AGREED TO RELY ON THE RECORDS OF THE OTHER PROTESTS
FOR RESOLUTION OF THE PROTEST, WITHOUT INDEPENDENT
DEVELOPMENT.
THE BSEP I PROVIDES TRAINEES WITH BASIC LITERACY AND COMPUTATIONAL
INSTRUCTION UP TO THE FIFTH-GRADE LEVEL, WHILE BSEP II PROVIDES
INSTRUCTION UP TO THE NINTH-GRADE LEVEL. ADDITIONAL INSTRUCTION IN BSEP
II ALLOWS THE TRAINEE TO ACQUIRE KNOWLEDGE OF HIS MILITARY OCCUPATIONAL
SPECIALTY FOR CAREER ENHANCEMENT AND TO OBTAIN A GENERAL EDUCATION
DIPLOMA.
ALTHOUGH THE PRECISE WORDING OF THE REQUIREMENTS DIFFERED IN MINOR
RESPECTS, ALL SOLICITATIONS REQUIRED THE CONTRACTORS TO BE EDUCATIONAL
INSTITUTIONS DULY ACCREDITED BY RECOGNIZED NATIONAL, REGIONAL OR STATE
ACCREDITING BODIES. THE ARMY CONSIDERS THE REQUIREMENT A DEFINITIVE
RESPONSIBILITY CRITERION, THAT IS, A PARTICULAR CAPABILITY-RELATED
REQUIREMENT THAT MUST BE MET TO BE ELIGIBLE FOR AWARD. THE ARMY
REJECTED LOYOLA/NONPUBLIC AS NONRESPONSIBLE BECAUSE IN THE AGENCY'S VIEW
THIS JOINT VENTURE, MADE UP OF ONE ACCREDITED PARTY AND ONE
NON-ACCREDITED PARTY, DOES NOT MEET THE REQUIREMENT.
LOYOLA/NONPUBLIC ARGUES THAT THE ACCREDITATION REQUIREMENT DOES NOT
BEAR A REASONABLE RELATION TO THE SERVICES TO BE PERFORMED. THE JOINT
VENTURE ASSERTS THAT ACCREDITED SCHOOLS ASSIGN FEW, IF ANY, MEMBERS OF
THEIR REGULAR FACULTIES TO SUCH CONTRACTS AND THAT THEREFORE THE ARMY
CAN EXPECT NO GREATER QUALITY CONTROL FROM THEM THAN WOULD BE PROVIDED
BY THE JOINT VENTURE, WHOSE INSTRUCTORS ALLEGEDLY MEET ALL OF THE
REQUIREMENTS SPECIFIED FOR INSTRUCTORS WITH RESPECT TO STATE
ACCREDITATION AND EXPERIENCE. LOYOLA/NONPUBLIC CONTENDS THAT THE
ACCREDITATION STANDARD THUS DOES NOTHING TO FURTHER THE ARMY'S GOAL OF
DEVELOPING PROGRAMS OF SUFFICIENT QUALITY TO SATISFY THE AGENCY'S NEED
FOR INSTRUCTION AND RELATED SERVICES WITH RESPECT TO BASIC ENGLISH,
READING, WRITING AND SPEAKING SKILLS. THE JOINT VENTURE POINTS OUT THAT
SCHOOLS FOR YACHT DESIGN, GEMOLOGY, GUN REPAIR, DRESS MAKING, BARBERING,
ETC. HAVE BEEN ACCREDITED BY SOME OF THE ACCREDITING ASSOCIATIONS
RECOGNIZED BY THE ARMY, AND THUS THOSE SCHOOLS PRESUMABLY WOULD BE
ELIGIBLE FOR THE CONTRACT AWARDS IN ISSUE. IT ALSO CONTENDS THAT
JOHNSON & WALES, WHICH NOW PERFORMS A NUMBER OF BSEP CONTRACTS, IS
ACCREDITED AS A COOKING SCHOOL AND AS AN ADVANCED BUSINESS SCHOOL, AND
HAS NO ACCREDITATION IN ANY OF THE AREAS OF BSEP INSTRUCTION.
LOYOLA/NONPUBLIC FURTHER ARGUES THAT LOYOLA'S ACCREDITATION SHOULD BE
IMPUTED TO THE JOINT VENTURE, AND THAT LOYOLA/NONPUBLIC THUS MEETS THE
ACCREDITATION REQUIREMENT.
THE ARMY EXPLAINS THE REASON FOR ACCREDITATION REQUIREMENT PRESCRIBED
AT PARAGRAPH 2-8.D OF AR 621-5:
"THE ARMY CONSIDERS THAT INSTITUTIONAL ACCREDITATION
IS ESSENTIAL IN DEVELOPING INSTRUCTIONAL PROGRAMS
OF SUFFICIENT QUALITY TO SATISFY ITS
MINIMUM NEEDS. ACCREDITATION IS A UNIQUE FEATURE
OF US EDUCATIONAL PRACTICES. IT INCLUDES VOLUNTARY
SELF-EVALUATION BY A SCHOOL AND APPRAISAL BY
A GROUP OF ITS PEERS. THIS PROCESS OPERATES THROUGH
NATIONALLY AND REGIONALLY RECOGNIZED ACCREDITING
AGENCIES AND ASSOCIATIONS. THESE AGENCIES OR
ASSOCIATIONS HAVE ESTABLISHED EDUCATIONAL CRITERIA TO
EVALUATE INSTITUTIONS IN TERMS OF THEIR OWN OBJECTIVES
AND TO ASCERTAIN WHETHER PROGRAMS OF EDUCATIONAL
QUALITY ARE BEING MAINTAINED. THEY PROVIDE
INSTITUTIONS WITH CONTINUED STIMULUS FOR IMPROVEMENT
TO INSURE THAT ACCREDITED STATUS MAY SERVE AS AN
AUTHENTIC INDEX OF EDUCATIONAL QUALITY. THUS, THE
ARMY RELIES ON ACCREDITATION BY THOSE AGENCIES AND
ASSOCIATIONS TO ASSURE REQUISITE QUALITY."
WE HELD IN A PREVIOUS CASE THAT THIS SORT OF ACCREDITATION
REQUIREMENT IS NOT AN UNDULY RESTRICTIVE DEFINITIVE RESPONSIBILITY
CRITERION, SINCE IT CLEARLY BEARS A REASONABLE RELATIONSHIP TO THE
SERVICES TO BE PERFORMED. SCHOOL FOR EDUCATIONAL ENRICHMENT, B-199003,
OCTOBER 16, 1980, 80-2 CPD 286. IN SO HOLDING, WE POINTED OUT THAT THE
PROCURING AGENCIES, NOT OUR OFFICE, ARE IN THE BEST POSITION TO
DETERMINE THEIR MINIMUM NEEDS AND HOW TO ACCOMMODATE THEM, AND THAT WE
THEREFORE WILL NOT OBJECT TO AGENCY DETERMINATIONS IN THESE RESPECTS
UNLESS THEY ARE SHOWN TO BE UNREASONABLE. WE FOUND THAT THE SAME
JUSTIFICATION FOR THE ACCREDITATION REQUIREMENT PROFFERED HERE - THE
PROMOTION AND MAINTENANCE OF PROGRAM QUALITY - AS WELL AS THE
MINIMIZATION OF OVERALL EDUCATIONAL COSTS AND THE ENHANCEMENT OF STUDENT
ACHIEVEMENT, SHOWED THAT THERE WAS A REASONABLE RELATION BETWEEN THE
ACCREDITATION OF THE CONTRACTOR AND THE PROVISION OF AN EFFECTIVE
PROGRAM OF INSTRUCTION.
INDEED, WE BELIEVE LOYOLA/NONPUBLIC OVERREACHES IN ITS LISTING OF
ACCREDITED SCHOOLS FOR YACHT DESIGN, GEMOLOGY, GUN REPAIR AND FASHION
DESIGN AS COMING WITHIN THE WORDING OF THE ACCREDITATION REQUIREMENT.
LOYOLA/NONPUBLIC HAS REFERRED TO NO INSTANCE WHERE AN INAPPROPRIATE
SCHOOL HAS BEEN AWARDED A TEACHING CONTRACT FOR BSEPS I AND II EXCEPT
FOR JOHNSON & WALES, WHICH LOYOLA/NONPUBLIC ASSERTS IS ACCREDITED ONLY
AS A COOKING SCHOOL AND BUSINESS SCHOOL. THE RECORD, HOWEVER, INDICATES
THAT JOHNSON & WALES IS A 4-YEAR, DEGREE-GRANTING INSTITUTION OF HIGHER
LEARNING WHICH HAS BEEN IN EXISTENCE SINCE 1914 AND OFFERS 2-YEAR
ASSOCIATE DEGREES, 4-YEAR BACHELOR DEGREES AND COURSES IN ENGLISH,
READING IMPROVEMENT AND MATHEMATICS, AS WELL AS COURSES IN DATA
PROCESSING, ACCOUNTING, ELECTRONICS, CULINARY ARTS, ETC. IT IS SUBJECT
TO THE SAME PERIODIC EVALUATIONS AND PEER REVIEWS AS ANY OTHER
ACCREDITED INSTITUTION.
ACCORDINGLY, WE FIND NO LEGAL MERIT IN LOYOLA/NONPUBLIC'S CONTENTION
THAT THE ACCREDITATION REQUIREMENT IS UNREASONABLE.
WE ALSO FIND NO MERIT TO LOYOLA/NONPUBLIC'S ARGUMENT THAT LOYOLA'S
ACCREDITATION SHOULD BE IMPUTED TO THE JOINT VENTURE.
THE ARMY REPORTS THAT THE INTENT OF THE ACCREDITATION REQUIREMENT IS
TO HAVE THE ACCREDITED INSTITUTION SERVE AS SOLE CONTRACTOR WITH FULL
RESPONSIBILITY FOR THE PROGRAM, AND ASSERTS THAT LOYOLA'S PARTICIPATION
IN THE JOINT VENTURE IS FAR SHORT OF THAT REQUIRED TO ASSURE THE QUALITY
PERFORMANCE CONTEMPLATED BY THE ACCREDITATION REQUIREMENT. THE ARMY
SUGGESTS THAT THE REAL PURPOSE OF THE JOINT VENTURE IS TO PERMIT
NONPUBLIC TO CIRCUMVENT THE ACCREDITATION REQUIREMENT, AND THAT THE REAL
OFFEROR WAS NONPUBLIC.
THE ARMY ALSO HAS FURNISHED A LETTER FROM THE COUNCIL ON
POSTSECONDARY ACCREDITATION, WHICH IS COMPOSED OF ACCREDITING BODIES.
THE COUNCIL STATES THAT INSTITUTIONAL ACCREDITATION IS A STATUS AWARDED
TO AN INSTITUTION AS A WHOLE, AND SUCH ACCREDITATION IS NOT TRANSFERABLE
BY ANY CONTRACTUAL ARRANGEMENT OR AFFILIATION. THE COUNCIL FURTHER
STATES THAT ANY CONTRACTUAL RELATIONSHIP BETWEEN AN ACCREDITED
INSTITUTION AND A NON-ACCREDITED INSTITUTION MUST PROVIDE THAT THE
ACCREDITED INSTITUTION EXERCISE SOLE AND DIRECT CONTROL, AND THAT
ENGAGING ANOTHER ORGANIZATION TO PROVIDE DIRECT INSTRUCTIONAL SERVICES
"IS IN MOST, IF NOT ALL, REGIONS CONSIDERED TO BE A MAJOR SUBSTANTIVE
CHANGE, REQUIRING NOTIFICATION TO AND APPROVAL BY THE APPROPRIATE
REGIONAL COMMISSION."
IT IS APPARENT FROM THE RECORDS ON THESE PROTESTS THAT THE ROLE OF
LOYOLA IS NOT ONE OF SOLE AND DIRECT CONTROL OR ONE INVOLVING ULTIMATE
AND CONTINUING RESPONSIBILITY FOR THE PROGRAMS. FOR EXAMPLE, THE
AGREEMENT BETWEEN LOYOLA AND NONPUBLIC BASICALLY IMPOSES UPON LOYOLA THE
OBLIGATION TO APPROVE ALL INSTRUCTORS, COURSE DESIGNS AND TEACHING
MATERIALS AND TO MAKE AT LEAST TWO ONE-DAY SITE VISITS ANNUALLY.
NONPUBLIC IS RESPONSIBLE FOR RECRUITING AND EMPLOYING ALL INSTRUCTORS
AND FOR ALL ADMINISTRATION AND CONTRACT MANAGEMENT. IN ADDITION, WHILE
LOYOLA WILL RECEIVE 20 PERCENT OF ANY PROFITS, NONPUBLIC WILL BE
RESPONSIBLE FOR ALL LOSSES AND WILL HOLD LOYOLA HARMLESS FROM ANY
LIABILITY ARISING UNDER THE AGREEMENT.
WE HAVE RECOGNIZED THAT THE RESOURCES, CAPABILITIES AND FACILITIES OF
ONE VENTURER AT TIMES MAY BE IMPUTED TO THE JOINT VENTURE. IN THESE
SITUATIONS, IMPUTATION WAS COMPATIBLE WITH THE PURPOSES IN ISSUE. FOR
EXAMPLE, IN HARPER ENTERPRISES, 53 COMP.GEN. 496 (1974), 74-1 CPD 31, WE
HELD THAT THE LOW BIDDER'S POST-BID OPENING JOINT VENTURE AGREEMENT WITH
ANOTHER PARTY IN ORDER TO SECURE ADDITIONAL RESOURCES SHOULD NOT HAVE
BEEN IGNORED IN JUDGING THE LOW BIDDER'S GENERAL RESPONSIBILITY, THAT
IS, THE FIRMS' ABILITY TO PERFORM. SEE ALSO 50 COMP.GEN. 530 (1971);
39 COMP.GEN. 468 (1959); G&C ENTERPRISES, INC., B-186748, MARCH 2,
1977, 77-1 CPD 155.
WE DO NOT BELIEVE, HOWEVER, THAT THE IMPUTATION OF ONE VENTURER'S
STATUS TO THE JOINT VENTURE IS APPROPRIATE WHERE IMPUTATION WOULD
FRUSTRATE THE REQUIREMENT FOR THE STATUS. THUS, FOR EXAMPLE, WHILE A
SMALL BUSINESS FIRM MAY SUBCONTRACT WITH A LARGE BUSINESS A PORTION OF A
CONTRACT THAT WAS SET ASIDE FOR SMALL BUSINESS WITHOUT ENDANGERING ITS
ELIGIBILITY, IT CANNOT TRANSFER OR IMPUTE ITS SMALL BUSINESS STATUS TO A
JOINT VENTURE COMPOSED OF ITSELF AND A LARGE BUSINESS FOR PURPOSES OF
COMPETING FOR SET-ASIDES. SEE 50 COMP.GEN., SUPRA.
HERE, IMPUTING LOYOLA'S ACCREDITATION TO THE JOINT VENTURE CLEARLY
WOULD NOT ENHANCE THE RESOURCES, CAPABILITIES AND FACILITIES OF THE
CONTRACTOR IN A MANNER COMPATIBLE WITH THE PURPOSES OF THE ACCREDITATION
REQUIREMENT. THE ARMY IMPOSED THE REQUIREMENT TO IMPROVE THE QUALITY OF
ITS TRAINING AND ITS ACCEPTANCE BY THE TRAINEES, ESSENTIALLY BY HAVING
ITS TRAINING PROGRAMS DIRECTLY CONTROLLED BY ACCREDITED INSTITUTIONS.
ACCEPTANCE OF THE BIDS AND OFFERS OF THE JOINT VENTURE, WHOSE MANAGING
VENTURER IS NOT ACCREDITED, WOULD FRUSTRATE THE ARMY'S INTENT, AND WOULD
LEAVE THE AGENCY ESSENTIALLY IN THE SAME POSITION AS IT WOULD BE WITHOUT
THE REQUIREMENT.
ACCORDINGLY, WE AGREE WITH THE ARMY THAT LOYOLA/NONPUBLIC DOES NOT
MEET THE ACCREDITATION REQUIREMENT.
LOYOLA/NONPUBLIC'S PROTESTS AGAINST THE REJECTION OF ITS BIDS AND
PROPOSALS THEREFORE ARE DENIED. JOHNSON & WALES' RECENT PROTEST (FORT
DRUM), WHERE AWARD HAS NOT YET BEEN MADE, IS SUSTAINED. WE ASSUME THAT
THE ARMY WILL DIRECT THE PROCURING AGENCY TO ACT IN ACCORDANCE WITH THE
CONCLUSIONS REACHED IN THIS DECISION. WE ALSO SUSTAIN JOHNSON & WALES'
PROTEST AGAINST THE AWARD TO LOYOLA/NONPUBLIC UNDER THE FORT SAM HOUSTON
INVITATION. WE NOTE, HOWEVER, THAT THE RECORD SHOWS THAT TERMINATION OF
THE CONTRACT IS NOT PRACTICABLE, AND THAT THE ARMY WILL NOT EXERCISE THE
OPTIONS IN LOYOLA/NONPUBLIC'S CONTRACT.
UNDER THE CIRCUMSTANCES, THEREFORE, NO FURTHER ACTION BY OUR OFFICE
IS NECESSARY. FN1 THE ARMY ALSO CONTESTS THE VALIDITY OF THE JOINT
VENTURE. SINCE WE BELIEVE LOYOLA/NONPUBLIC PROPERLY WAS FOUND
NONRESPONSIBLE, AND THUS INELIGIBLE FOR AWARD, WE NEED NOT CONSIDER THIS
ISSUE. FN2 IN THIS SERIES OF PROCUREMENTS AND IN THE FORT DEVENS
PROCUREMENT (LISTED FIFTH), THE ARMY SUBMITTED THE MATTER OF THE JOINT
VENTURE'S RESPONSIBILITY TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR
CONSIDERATION UNDER ITS CERTIFICATE OF COMPETENCY (COC) PROCEDURES, AND
IN ALL OF THOSE CASES THE SBA DENIED THE COC ON GROUNDS THAT THE JOINT
VENTURE WAS NOT A SMALL BUSINESS.
B-210677, MAR 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST FILED WITH GAO MORE THAN 10 WORKING DAYS AFTER RECEIPT OF
INITIAL ADVERSE ACTION ON AGENCY PROTEST IS UNTIMELY AND WILL NOT BE
CONSIDERED. INTERIM APPEALS TO AGENCY DO NOT TOLL RUNNING OF 10 WORKING
DAY GAO FILING PERIOD.
PHOTICA, INC.:
PHOTICA, INC., PROTESTS THE GENERAL SERVICES ADMINISTRATION'S (GSA)
REFUSAL TO RENEW PHOTICA'S FEDERAL SUPPLY SCHEDULE (FSS) CONTRACT NO.
GS-002-41193 FOR PHOTOGRAPHIC AND CHEMICAL SUPPLIES. IN THIS REGARD,
PHOTICA CONTENDS THAT IT WAS PRECLUDED FROM SUBMITTING A TIMELY RENEWAL
PROPOSAL FOR GSA'S CONSIDERATION DUE TO GSA'S ALLEGED FAILURE TO PROVIDE
IT EITHER NOTIFICATION OF THE RENEWAL OPPORTUNITY, OR A COPY OF THE
RENEWAL SOLICITATION (NO. FGE-B2-75202-N-8-19-82).
WE DISMISS THE PROTEST AS UNTIMELY FILED.
PHOTICA'S PROTEST CORRESPONDENCE INDICATES THAT IT FIRST BECAME AWARE
OF GSA'S RENEWAL SOLICITATION ON AUGUST 25, 1982, 6 DAYS AFTER THE
CLOSING DATE FOR RECEIPT OF OFFERS UNDER THAT SOLICITATION. ON AUGUST
26, PHOTICA PROTESTED TO GSA THE FACT THAT IT WAS EFFECTIVELY PRECLUDED
FROM FSS CONTRACT RENEWAL CONSIDERATION BECAUSE IT DID NOT RECEIVE A
COPY OF THE RENEWAL SOLICITATION. IT ALSO ASSERTS THAT THERE WAS NO
ADEQUATE NOTIFICATION OF THE RENEWAL OPPORTUNITY IN THE COMMERCE
BUSINESS DAILY, OR ANY PERSONAL NOTIFICATION WHICH WOULD HAVE ALLOWED IT
TO SUBMIT A TIMELY RENEWAL OFFER TO GSA.
BY LETTER OF SEPTEMBER 8, GSA REPLIED TO PHOTICA'S PROTEST BY STATING
THAT GSA'S MAILING LIST INDICATED THAT PHOTICA WAS FURNISHED THE RENEWAL
SOLICITATION; THAT, IN GSA'S VIEW, THE COMMERCE BUSINESS DAILY NOTICE
OF THE RENEWAL SOLICITATION ON JULY 29 PROVIDED ADEQUATE OPPORTUNITY FOR
PHOTICA TO REQUEST AND RECEIVE THE SOLICITATION AND SUBMIT A TIMELY
OFFER BY THE AUGUST 19 CLOSING DATE; AND THAT GSA WOULD NOT CONSIDER
ANY RENEWAL OFFER SUBMITTED AFTER THE CLOSING DATE.
BY LETTER OF NOVEMBER 8, 1982, PHOTICA APPEALED TO THE ADMINISTRATOR
OF GSA, WHO REFERRED THE MATTER TO THE GSA BOARD OF CONTRACT APPEALS.
THE BOARD, BY LETTER TO PHOTICA DATED JANUARY 12, 1983, DISMISSED THE
MATTER AS NOT BEING WITHIN THE BOARD'S JURISDICTION.
THE PROTEST WAS FILED AT GAO ON FEBRUARY 1, 1983. OUR BID PROTEST
PROCEDURES AT 4 C.F.R. SEC. 21.2(A) (1982) PROVIDE THAT ONCE A PROTEST
HAS BEEN TIMELY FILED WITH THE CONTRACTING AGENCY, ANY SUBSEQUENT
PROTEST TO THE COMPTROLLER GENERAL MUST BE FILED WITHIN 10 WORKING DAYS
OF ACTUAL OR CONSTRUCTIVE KNOWLEDGE OF ANY INITIAL ADVERSE AGENCY ACTION
REGARDING THE PROTEST. IN THIS REGARD, INTERIM APPEALS TO THE AGENCY DO
NOT TOLL THE RUNNING OF THE 10 DAYS. SEE KENNEY REFRIGERATION,
B-191026, JANUARY 31, 1978, 78-1 CPD 87.
WE VIEW GSA'S SEPTEMBER 8 RESPONSE TO PHOTICA'S AGENCY PROTEST AS THE
INITIAL ADVERSE AGENCY ACTION. CONSEQUENTLY, PHOTICA'S DELAY IN FILING
ITS PROTEST WITH OUR OFFICE UNTIL FEBRUARY 1, 1983, RENDERS THE PROTEST
UNTIMELY AND NOT FOR CONSIDERATION ON THE MERITS.
THE PROTEST IS DISMISSED.
B-210677, MAR 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST FILED WITH GAO MORE THAN 10 WORKING DAYS AFTER RECEIPT OF
INITIAL ADVERSE ACTION ON AGENCY PROTEST IS UNTIMELY AND WILL NOT BE
CONSIDERED. INTERIM APPEALS TO AGENCY DO NOT TOLL RUNNING OF 10 WORKING
DAY GAO FILING PERIOD.
PHOTICA, INC.:
PHOTICA, INC., PROTESTS THE GENERAL SERVICES ADMINISTRATION'S (GSA)
REFUSAL TO RENEW PHOTICA'S FEDERAL SUPPLY SCHEDULE (FSS) CONTRACT NO.
GS-002-41193 FOR PHOTOGRAPHIC AND CHEMICAL SUPPLIES. IN THIS REGARD,
PHOTICA CONTENDS THAT IT WAS PRECLUDED FROM SUBMITTING A TIMELY RENEWAL
PROPOSAL FOR GSA'S CONSIDERATION DUE TO GSA'S ALLEGED FAILURE TO PROVIDE
IT EITHER NOTIFICATION OF THE RENEWAL OPPORTUNITY, OR A COPY OF THE
RENEWAL SOLICITATION (NO. FGE-B2-75202-N-8-19-82).
WE DISMISS THE PROTEST AS UNTIMELY FILED.
PHOTICA'S PROTEST CORRESPONDENCE INDICATES THAT IT FIRST BECAME AWARE
OF GSA'S RENEWAL SOLICITATION ON AUGUST 25, 1982, 6 DAYS AFTER THE
CLOSING DATE FOR RECEIPT OF OFFERS UNDER THAT SOLICITATION. ON AUGUST
26, PHOTICA PROTESTED TO GSA THE FACT THAT IT WAS EFFECTIVELY PRECLUDED
FROM FSS CONTRACT RENEWAL CONSIDERATION BECAUSE IT DID NOT RECEIVE A
COPY OF THE RENEWAL SOLICITATION. IT ALSO ASSERTS THAT THERE WAS NO
ADEQUATE NOTIFICATION OF THE RENEWAL OPPORTUNITY IN THE COMMERCE
BUSINESS DAILY, OR ANY PERSONAL NOTIFICATION WHICH WOULD HAVE ALLOWED IT
TO SUBMIT A TIMELY RENEWAL OFFER TO GSA.
BY LETTER OF SEPTEMBER 8, GSA REPLIED TO PHOTICA'S PROTEST BY STATING
THAT GSA'S MAILING LIST INDICATED THAT PHOTICA WAS FURNISHED THE RENEWAL
SOLICITATION; THAT, IN GSA'S VIEW, THE COMMERCE BUSINESS DAILY NOTICE
OF THE RENEWAL SOLICITATION ON JULY 29 PROVIDED ADEQUATE OPPORTUNITY FOR
PHOTICA TO REQUEST AND RECEIVE THE SOLICITATION AND SUBMIT A TIMELY
OFFER BY THE AUGUST 19 CLOSING DATE; AND THAT GSA WOULD NOT CONSIDER
ANY RENEWAL OFFER SUBMITTED AFTER THE CLOSING DATE.
BY LETTER OF NOVEMBER 8, 1982, PHOTICA APPEALED TO THE ADMINISTRATOR
OF GSA, WHO REFERRED THE MATTER TO THE GSA BOARD OF CONTRACT APPEALS.
THE BOARD, BY LETTER TO PHOTICA DATED JANUARY 12, 1983, DISMISSED THE
MATTER AS NOT BEING WITHIN THE BOARD'S JURISDICTION.
THE PROTEST WAS FILED AT GAO ON FEBRUARY 1, 1983. OUR BID PROTEST
PROCEDURES AT 4 C.F.R. SEC. 21.2(A) (1982) PROVIDE THAT ONCE A PROTEST
HAS BEEN TIMELY FILED WITH THE CONTRACTING AGENCY, ANY SUBSEQUENT
PROTEST TO THE COMPTROLLER GENERAL MUST BE FILED WITHIN 10 WORKING DAYS
OF ACTUAL OR CONSTRUCTIVE KNOWLEDGE OF ANY INITIAL ADVERSE AGENCY ACTION
REGARDING THE PROTEST. IN THIS REGARD, INTERIM APPEALS TO THE AGENCY DO
NOT TOLL THE RUNNING OF THE 10 DAYS. SEE KENNEY REFRIGERATION,
B-191026, JANUARY 31, 1978, 78-1 CPD 87.
WE VIEW GSA'S SEPTEMBER 8 RESPONSE TO PHOTICA'S AGENCY PROTEST AS THE
INITIAL ADVERSE AGENCY ACTION. CONSEQUENTLY, PHOTICA'S DELAY IN FILING
ITS PROTEST WITH OUR OFFICE UNTIL FEBRUARY 1, 1983, RENDERS THE PROTEST
UNTIMELY AND NOT FOR CONSIDERATION ON THE MERITS.
THE PROTEST IS DISMISSED.
B-210675, FEB 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST FILED WITH GAO MORE THAN 10 WORKING DAYS AFTER PROTESTER HAD
KNOWLEDGE OF INITIAL ADVERSE AGENCY ACTION ON ITS PROTEST TO AGENCY IS
UNTIMELY FILED AND IS NOT FOR CONSIDERATION ON THE MERITS.
KORD'S AMBULANCE SERVICE, INC.:
KORD'S AMBULANCE SERVICE, INC., (KORD'S), PROTESTS THE VETERANS
ADMINISTRATION CONTRACTING OFFICER'S AWARD OF A CONTRACT FOR AMBULANCE
SERVICES. KORD'S PREVIOUSLY PROTESTED THIS AWARD TO THE VETERANS
ADMINISTRATION. ON DECEMBER 16, 1982, THE VETERANS ADMINISTRATION
DENIED THE PROTEST.
OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.2(A) (1982), REQUIRE
THAT IF A PROTEST IS INITIALLY FILED WITH THE AGENCY, ANY SUBSEQUENT
PROTEST TO OUR OFFICE MUST BE FILED WITHIN 10 WORKING DAYS OF ACTUAL OR
CONSTRUCTIVE KNOWLEDGE OF INITIAL ADVERSE AGENCY ACTION.
ALLOWING A REASONABLE TIME FOR RECEIPT OF THE DENIAL LETTER, THE
PROTEST FILED WITH OUR OFFICE ON JANUARY 26, 1983, WAS FILED MORE THAN
10 WORKING DAYS AFTER DENIAL OF THE PROTEST TO THE AGENCY. SEE HALIFAX
ENGINEERING, INC., B-209822, DECEMBER 15, 1982, 82-2 CPD 537.
CONSEQUENTLY, THE PROTEST IS UNTIMELY AND WILL NOT BE CONSIDERED ON THE
MERITS.
THE PROTEST IS DISMISSED.
B-210674, FEB 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST OF ALLEGED SOLICITATION DEFECTS FILED AFTER THE CLOSING DATE
FOR THE RECEIPT OF INITIAL PROPOSALS IS NOT TIMELY UNDER GAO BID PROTEST
PROCEDURES.
SCIENCE INFORMATION SERVICES, INC.:
SCIENCE INFORMATION SERVICES, INC. (SIS) PROTESTS A SOLICITATION
NOTICE APPEARING IN THE COMMERCE BUSINESS DAILY CALLING FOR PROPOSALS TO
BE SUBMITTED TO THE GENERAL SERVICES ADMINISTRATION FOR CONDUCTING A
CONFERENCE FOR INFORMATION RESOURCES MANAGEMENT. SIS OBJECTS TO SEVERAL
ASPECTS OF THE NOTICE. WE DISMISS THE PROTEST.
PROTESTS BASED ON ALLEGED SOLICITATION IMPROPRIETIES WHICH ARE
APPARENT PRIOR TO THE CLOSING DATE FOR RECEIPT OF INITIAL PROPOSALS (AS
IS THE CASE HERE) MUST BE FILED PRIOR TO THE CLOSING DATE. 4 C.F.R.
21.2(B)(1) (1982). ACCORDING TO SIS, THE CLOSING DATE WAS JANUARY 31,
1983. SIS'S PROTEST WAS SENT BY REGULAR MAIL ON JANUARY 28 AND WAS
RECEIVED HERE ON FEBRUARY 1, 1983, AS INDICATED BY OUR TIME/DATE STAMP.
THE PROTEST IS THEREFORE UNTIMELY AND WILL NOT BE CONSIDERED.
THE PROTEST IS DISMISSED.
B-210670, FEB 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST NOT RECEIVED WITHIN OUR OFFICE IN 10 WORKING DAYS AFTER THE
PROTESTER KNEW OR SHOULD HAVE KNOWN OF THE BASIS OF ITS PROTEST IS
UNTIMELY AND WILL NOT BE CONSIDERED.
THOMAS & SONS, INC.:
THOMAS & SONS, INC. (THOMAS), PROTESTS AWARD OF A CONTRACT TO ANOTHER
BIDDER UNDER INVITATION FOR BIDS DTFA14-82-B-A0701, ISSUED BY THE
FEDERAL AVIATION ADMINISTRATION, DEPARTMENT OF TRANSPORTATION.
WE DISMISS THE PROTEST.
THE PROTEST SHOWS ON ITS FACE THAT THOMAS RECEIVED NOTICE OF THE
AWARD OF THE CONTRACT AND THE REASON FOR NOT ACCEPTING THOMAS' BID BY
LETTER DATED NOVEMBER 23, 1982. THE PROTEST WAS NOT RECEIVED IN OUR
OFFICE UNTIL FEBRUARY 1, 1983, MORE THAN 2 MONTHS AFTER NOTICE OF THE
BASIS OF ITS PROTEST. EVEN THOUGH IT IS NOT KNOWN WHEN THOMAS RECEIVED
THE LETTER OF NOVEMBER 23, IT IS REASONABLE TO ASSUME THAT RECEIPT WAS
MORE THAN 10 WORKING DAYS, BEFORE WE RECEIVED THE PROTEST.
SECTION 21.2(B)(2) OF OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC.
21.2(B)(2) (1982), PROVIDES THAT A PROTEST MUST BE FILED WITHIN 10
WORKING DAYS AFTER THE BASIS FOR THE PROTEST IS KNOWN OR SHOULD HAVE
BEEN KNOWN. SINCE THE PROTEST WAS NOT RECEIVED WITHIN 10 WORKING DAYS,
AS REQUIRED, IT IS UNTIMELY AND WILL NOT BE CONSIDERED.
B-210669, APR 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. BID RECEIVED ON TOTAL SMALL BUSINESS SET-ASIDE SOLICITATION WHICH
INDICATES BIDDER WOULD NOT FURNISH PRODUCTS MANUFACTURED OR PRODUCED BY
SMALL BUSINESS CONCERNS WAS PROPERLY REJECTED AS NONRESPONSIVE.
2. ALLEGATION, AFTER BID OPENING, THAT QUESTIONS WHETHER ANY SMALL
BUSINESS CONCERNS COULD MANUFACTURE OR PRODUCE ITEM PROCURED BY TOTAL
SMALL BUSINESS SET-ASIDE IS UNTIMELY AND IS NOT FOR CONSIDERATION ON
MERITS BY GAO AS IT RELATES TO APPARENT IMPROPRIETY IN SOLICITATION
WHICH WAS NOT PROTESTED TO AGENCY PRIOR TO BID OPENING.
A G STEEL, INC.:
A G STEEL, INC. (STEEL), A SMALL BUSINESS REGULAR DEALER, PROTESTS
THE REJECTION OF ITS BID SUBMITTED IN RESPONSE TO SOLICITATION NO.
53-01310 ISSUED BY THE DEPARTMENT OF THE INTERIOR (INTERIOR) FOR STEEL
ANGLES. THE PROCUREMENT WAS A 100-PERCENT SMALL BUSINESS SET-ASIDE.
STEEL PROTESTED INITIALLY TO THE AGENCY, APPARENTLY AFTER BID OPENING.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
STEEL'S BID WAS REJECTED AS NONRESPONSIVE BECAUSE IT REPRESENTED THAT
THE SUPPLIES TO BE FURNISHED WOULD NOT BE MANUFACTURED OR PRODUCED BY A
SMALL BUSINESS.
STEEL CONTENDS THAT NO SMALL BUSINESS CAN MINE, SMELT AND MANUFACTURE
THE ANGLES IN QUESTION AND THAT IS WHY IT REPRESENTED ON ITS BID THAT
THE ANGLES TO BE FURNISHED WOULD NOT BE MANUFACTURED OR PRODUCED BY A
SMALL BUSINESS. STEEL DISAGREES WITH INTERIOR'S POSITION THAT PUNCHING
OR DRILLING HOLES IN THE ANGLES CONSTITUTES A SIGNIFICANT CONTRIBUTION
TO THE MANUFACTURE OF THE END PRODUCT. STEEL ARGUES THAT THE HOLE
PUNCHING IS NOTHING MORE THAN A FABRICATING PROCEDURE TO A PRODUCT THAT
IS ALREADY MANUFACTURED.
THIS OFFICE HAS CONSISTENTLY HELD THAT WHERE A BID ON A TOTAL SMALL
BUSINESS SET-ASIDE FAILS TO ESTABLISH THE INTENTION OF THE BIDDER, OR,
AS IN THE PRESENT CASE, INDICATES A CONTRARY INTENTION, TO FURNISH
PRODUCTS MANUFACTURED OR PRODUCED BY SMALL BUSINESS CONCERNS, THE BID IS
NONRESPONSIVE AND THE BIDDER IS INELIGIBLE FOR AWARD. SEE MIL-PAC,
INC., B-181717, OCTOBER 8, 1974, 74-2 CPD 196; CULLIGAN, INC., 58
COMP.GEN. 307 (1979), 79-1 CPD 149; PRESTEX, INC., 59 COMP.GEN. 146
(1979), 79-2 CPD 411. THUS, STEEL'S BID WAS PROPERLY REJECTED AS
NONRESPONSIVE.
STEEL QUESTIONS THE SMALL BUSINESS RESTRICTION BECAUSE OF ITS VIEW
THAT NO SMALL BUSINESS FIRM IS CAPABLE OF MANUFACTURING OR PRODUCING
THIS ITEM. THIS RELATES TO AN ALLEGED IMPROPRIETY OR DEFECT IN THE
SOLICITATION WHICH WAS APPARENT PRIOR TO BID OPENING. UNDER OUR BID
PROTEST PROCEDURES, THIS ISSUE IS UNTIMELY SINCE IT SHOULD HAVE BEEN
PROTESTED TO THE AGENCY PRIOR TO BID OPENING FOR US TO CONSIDER IT NOW.
4 C.F.R. SECS. 21.2(A) AND (B)(1) (1982). SEE BURRELLE'S PRESS CLIPPING
SERVICE, B-196126, NOVEMBER 6, 1979, 79-2 CPD 333.
B-210668, FEB 25, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. IN ORDER TO BE CONSIDERED FILED WITHIN A REASONABLE TIME,
COMPLAINTS BASED ON ALLEGED IMPROPRIETIES IN A GRANTEE'S SOLICITATION
WHICH ARE APPARENT PRIOR TO BID OPENING MUST BE FILED IN ACCORDANCE WITH
TIME STANDARDS ESTABLISHED FOR BID PROTESTS IN DIRECT PROCUREMENTS. 4
C.F.R. SEC. 21.2(B)(1) (1982).
2. COMPLAINT ALLEGING DEFECTS WHICH ARE APPARENT ON THE FACE OF A
SOLICITATION FILED WITH THE BID IS NOT TIMELY UNDER OUR BID PROTEST
PROCEDURES SINCE IT WAS NOT FILED BEFORE BID OPENING. 4 C.F.R. SEC.
21.2(B)(1) (1982).
EXPORT TRADE CORPORATION:
THE EXPORT TRADE CORPORATION (ETC) COMPLAINS AGAINST THE AWARD OF A
CONTRACT FOR WATER WELL DRILLING EQUIPMENT FOR SOMALIA UNDER INVITATION
FOR BIDS (IFB) NO. 649/005. THIS PROCUREMENT WAS FINANCED UNDER AN
AGENCY FOR INTERNATIONAL DEVELOPMENT (AID) GRANT, AND THIS OFFICE WILL
REVIEW COMPLAINTS CONCERNING AWARD OF CONTRACTS UNDER AID GRANTS. SEE
PEERLESS PUMP COMPANY, B-198180, AUGUST 19, 1980, 80-2 CPD 134. THE
PROCUREMENT WAS CONDUCTED BY THE AMERICAN EXPORT GROUP INTERNATIONAL
SERVICES DEVELOPMENT CORPORATION (AEGIS), AS PURCHASING AGENT FOR
SOMALIA.
ETC COMPLAINS THAT THE IFB IMPROPERLY RESTRICTED COMPETITION SOLELY
TO INGERSOLL-RAND PRODUCTS. ETC ALSO ARGUES THAT THE PROCUREMENT OF THE
ITEMS SOLICITED SHOULD HAVE BEEN DIVIDED INTO SMALLER PROCUREMENTS,
WHICH WOULD HAVE RESULTED IN LOWER PRICES AND SAVINGS WHICH AID SHOULD
WANT TO ENCOURAGE.
ETC APPARENTLY TIMELY SUBMITTED A BID DATED OCTOBER 20, 1982. BID
OPENING WAS OCTOBER 29, 1982. IN ITS BID, ETC OFFERED ROCKMASTER, INC.,
HAMMER BITS, INSTEAD OF THOSE MANUFACTURED BY INGERSOLL-RAND WHICH WERE
REQUIRED UNDER THE IFB. ETC STATED IN THE BID THAT IT DID NOT
UNDERSTAND WHY THE SPECIFICATION WAS LIMITED TO INGERSOLL-RAND. ALSO,
IT SENT A LETTER TO AID DATED OCTOBER 25, 1982, AND ONE TO AEGIS DATED
NOVEMBER 18, 1982, APPARENTLY PROTESTING THE RESTRICTIVE SPECIFICATION,
AND ARGUING THAT THE DIVIDING OF THE REQUIREMENTS INTO SMALLER UNITS
WOULD HAVE LED TO LOWER PRICES AND SAVINGS.
BY LETTER DATED NOVEMBER 30, 1982, AEGIS ADVISED ETC THAT
INGERSOLL-RAND SUBMITTED THE LOW RESPONSIVE BID. SINCE ETC'S BID HAD
BEEN LOWER, ETC CONCLUDED THAT IT HAD BEEN DETERMINED NONRESPONSIVE
BECAUSE IT BID ROCKMASTER HAMMER BITS INSTEAD OF INGERSOLL-RAND BITS.
IN CARAVELLE INDUSTRIES, INC., 60 COMP.GEN. 414 (1981), 81-1 CPD 317,
WE STATED THAT WHILE IT MIGHT NOT ALWAYS BE APPROPRIATE TO ESTABLISH
STRICT TIME LIMITS FOR FILING GRANT COMPLAINTS, THEY MUST BE FILED
WITHIN A "REASONABLE" TIME SO THAT WE CAN DECIDE AN ISSUE WHILE IT IS
STILL PRACTICABLE TO RECOMMEND CORRECTIVE ACTION IF WARRANTED. WE ADDED
THAT IN MOST INSTANCES, THE ONLY "REASONABLE" TIME FOR FILING COMPLAINTS
IN WHICH SOLICITATION DEFICIENCIES WERE ALLEGED WOULD BE THE TIME
REQUIRED BY OUR BID PROTEST PROCEDURES FOR DIRECT FEDERAL PROCUREMENTS,
I.E., BEFORE BID OPENING OR THE TIME FOR RECEIPT OF PROPOSALS.
THEREFORE, IN ORDER TO BE CONSIDERED FILED WITHIN A REASONABLE TIME, A
COMPLAINT BASED ON IMPROPRIETIES WHICH ARE APPARENT ON THE FACE OF A
SOLICITATION, MUST BE FILED BEFORE BID OPENING. WE ALSO HAVE STATED
THAT A PROTEST TO THE AGENCY, FILED WITH A BID WILL NOT BE CONSIDERED
TIMELY. SEE PRECISION DYNAMICS CORPORATION, B-207823, JULY 9, 1982,
82-2 CPD 35. THEREFORE, IF WE CONSIDER ETC'S STATEMENT SUBMITTED IN ITS
BID AS A COMPLAINT (AGAINST RESTRICTIVE SPECIFICATIONS), THE COMPLAINT
TO THE AGENCY WAS UNTIMELY FILED, AND ETC'S SUBSEQUENT COMPLAINT FILED
WITH OUR OFFICE APPROXIMATELY 3 MONTHS AFTER BID OPENING, IS NOT TIMELY.
CF. BRUMM CONSTRUCTION COMPANY, B-201613, OCTOBER 6, 1981, 81-2 CPD
280.
WE DISMISS THE COMPLAINT.
B-210667, DEC 23, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
ALTHOUGH SHIPPING INFORMATION (FORKLIFT
TRUCK WEIGHT AND DIMENSIONS) EXCEEDED
SPECIFICATION LIMITATIONS, BID COULD
PROPERLY BE ACCEPTED AS RESPONSIVE SINCE
SHIPPING DATA MAY REFLECT THE USE OF
BLOCKING AND BRACING MATERIALS AS WELL AS
THE TRUCK ITSELF AND OTHER CIRCUMSTANCES
INDICATED BIDDER DID NOT INTEND TO QUALIFY
ITS BID.
SILENT HOIST & CRANE CO., INC.:
SILENT HOIST & CRANE CO., INC. PROTESTS THE AWARD OF A CONTRACT FOR
SEVEN FORKLIFT TRUCKS WITH AN OPTION FOR SEVEN MORE TRUCKS TO HYSTER
COMPANY UNDER INVITATION FOR BIDS (IFB) NO. DLA700-82-B-1777, ISSUED BY
THE DEFENSE CONSTRUCTION SUPPLY CENTER. SILENT CONTENDS THAT HYSTER'S
BID SHOULD HAVE BEEN REJECTED AS NONRESPONSIVE BECAUSE THE SHIPPING
WEIGHTS AND DIMENSIONS SET FORTH IN ITS BID EXCEED THE MAXIMUM WEIGHTS
AND DIMENSIONS REQUIRED BY THE SPECIFICATIONS. WE DENY THE PROTEST.
THE AGENCY DETERMINED THAT OF THE TWO BIDS RECEIVED, HYSTER'S WAS
LOW. BY LETTER TO THE CONTRACTING OFFICER, SILENT CONTENDED THAT
HYSTER'S BID WAS NONRESPONSIVE BECAUSE HYSTER INDICATED IN THE
SOLICITATION CLAUSE ENTITLED "GUARANTEED MAXIMUM SHIPPING WEIGHTS AND
DIMENSIONS" THAT EACH TRUCK HAD A MAXIMUM SHIPPING WEIGHT OF 33,000
POUNDS AND WAS 130 INCHES HIGH AND 98 INCHES WIDE WHILE THE SOLICITATION
SPECIFICATIONS REQUIRED A TRUCK WITH A MAXIMUM WEIGHT OF 30,800 POUNDS,
MAXIMUM COLLAPSED MAST HEIGHT OF 128 INCHES AND WIDTH OF 96 INCHES. THE
CONTRACTING OFFICER REPORTS THAT THE AGENCY'S TRANSPORTATION EXPERT AND
HYSTER BOTH INFORMED HER THAT THE MAXIMUM SHIPPING WEIGHT AND DIMENSIONS
USED BY HYSTER INCLUDED BOTH THE TRUCKS AND PACKING MATERIALS.
CONSEQUENTLY, SHE DENIED SILENT'S PROTEST AND MADE AWARD TO HYSTER AS
THE LOW RESPONSIVE BIDDER. THE CONTRACTING OFFICER LATER REPORTED THAT
THERE HAD BEEN A MISUNDERSTANDING BETWEEN HER AND THE AGENCY
TRANSPORTATION EXPERT AND THAT SINCE HYSTER STATED IN ITS BID THAT THE
TRUCKS WOULD BE SHIPPED "LOOSE," THE EXCESS WEIGHT AND DIMENSIONS IN
HYSTER'S BID COULD NOT BE ATTRIBUTED TO PACKING MATERIAL. NEVERTHELESS,
THE CONTRACTING OFFICER MAINTAINS THAT HYSTER'S BID WAS PROPERLY
ACCEPTED BECAUSE SHE BELIEVES THAT SHIPPING WEIGHTS AND DIMENSIONS ARE
MATERIAL ONLY FOR THE CALCULATION OF TRANSPORTATION COSTS AND ARE NOT
RELEVANT TO A BIDDER'S RESPONSIVENESS TO THE SPECIFICATION REQUIREMENTS.
THE SHIPPING DATA CLAUSE PROVIDED THAT EACH BID WOULD BE EVALUATED BY
ADDING TO THE F.O.B. ORIGIN PRICE ALL TRANSPORTATION COSTS TO THE
DESTINATION SPECIFIED. IT FURTHER INFORMED BIDDERS THAT IF THE SUPPLIES
DELIVERED EXCEEDED THE GUARANTEED MAXIMUM SHIPPING WEIGHT OR DIMENSIONS,
THE CONTRACT PRICE WOULD BE REDUCED BY AN AMOUNT EQUAL TO THE DIFFERENCE
BETWEEN THE TRANSPORTATION COSTS COMPUTED FOR EVALUATION PURPOSES BASED
ON THE BIDDER'S GUARANTEED MAXIMUM SHIPPING WEIGHTS OR DIMENSIONS AND
THE TRANSPORTATION COSTS THAT SHOULD HAVE BEEN USED FOR EVALUATION
PURPOSES BASED ON CORRECT SHIPPING DATA. FINALLY, THE CLAUSE STATED
THAT IF THE BIDDER FAILED TO SUPPLY THE NECESSARY SHIPPING DATA, THE
AGENCY WOULD USE THE ESTIMATED DATA IT LISTED IN THE CLAUSE FOR
TRANSPORTATION COST EVALUATION. THE AGENCY'S ESTIMATED SHIPPING WEIGHT
WAS 34,000 POUNDS, AND THE DIMENSIONS WERE 153 INCHES HIGH AND 98 INCHES
WIDE. THE SOLICITATION STATED THAT THE AGENCY'S ESTIMATE WAS BASED ON
"LOOSE" SHIPMENT.
THE PURPOSE OF THIS TYPE OF CLAUSE IS TO ENABLE THE GOVERNMENT TO
ASCERTAIN ITS TOTAL COST FOR A PROPOSED CONTRACT AND TO ESTABLISH THE
BASIS FOR A CONTRACT PRICE REDUCTION IN THE EVENT THE MAXIMUM GUARANTEED
SHIPPING WEIGHTS OR DIMENSIONS ARE EXCEEDED. WE HAVE RECOGNIZED THAT
BIDDERS MAY USE GUARANTEED SHIPPING WEIGHT AND DIMENSIONS WHICH ARE LESS
THAN THE ACTUAL WEIGHT AND DIMENSIONS AS AN ALTERNATIVE TO REDUCING THE
PRICE FOR THE ITEM ITSELF, CAPITAL INDUSTRIES, INC., B-190818, JULY 7,
1978, 78-2 CPD 17; GENERAL FIRE EXTINGUISHER CORPORATION, B-186954,
NOVEMBER 15, 1976, 76-2 CPD 413. SIMILARLY, WE HAVE NOTED THAT BIDDERS
MAY PROVIDE GUARANTEED SHIPPING WEIGHT AND DIMENSIONS WHICH ARE GREATER
THAN THE ACTUAL WEIGHT OR DIMENSIONS TO ELIMINATE THE OBLIGATION TO PAY
EXCESS TRANSPORTATION COSTS IN CASE THE ITEM DELIVERED FOR SHIPMENT
EXCEEDS THE GUARANTEED WEIGHT OR DIMENSIONS. SEE 48 COMP.GEN. 357
(1968). WHILE BIDDERS MAY UNDERSTATE OR OVERSTATE GUARANTEED WEIGHT OR
DIMENSIONS, THEY MUST TAKE CARE TO DO SO ONLY IN CIRCUMSTANCES WHERE
THEY DO NOT CREATE DOUBT AS TO THEIR INTENT TO COMPLY WITH THE
SPECIFICATIONS. IN THE CITED CASES, THERE WAS NO EVIDENCE THAT THE
FIGURES INSERTED BY THE BIDDERS IN THE SHIPPING DATA CLAUSES REPRESENTED
A DEVIATION FROM ANY SPECIFICATION REQUIREMENTS. WHERE, HOWEVER, THE
FURNISHED SHIPPING DATA SUGGESTS THAT THE SPECIFICATIONS WILL NOT BE
MET, THE BID MUST BE REJECTED. SEE STAR-LINE ENTERPRISES, INC.,
B-210732, OCTOBER 12, 1983, 83-2 CPD 450, WHERE THE SHIPPING DATA
INDICATED THAT THE VEHICLE OFFERED WOULD BE NARROWER AND LONGER THAN THE
SPECIFICATIONS ALLOWED.
HERE, HYSTER'S INDICATING IN THE SHIPPING DATA CLAUSE THAT ITS TRUCKS
WOULD BE SHIPPED "LOOSE" BUT THAT THE SHIPPING WEIGHT AND DIMENSIONS
WOULD EXCEED WHAT THE SPECIFICATIONS PERMITTED FOR THE TRUCKS ON ITS
FACE RAISES SOME DOUBT AS TO WHETHER HYSTER WAS OFFERING TO COMPLY WITH
THE SPECIFICATIONS. WE THINK THAT DOUBT IS EASILY RESOLVED IN FAVOR OF
HYSTER UNDER THE CIRCUMSTANCES OF THIS CASE, HOWEVER. FIRST, EVEN THOUGH
THE TRUCKS ARE TO BE SHIPPED "LOOSE," IT IS NOT UNREASONABLE, AS HYSTER
EXPLAINED TO THE AGENCY, THAT "PACKING, BLOCKING AND BRACING MATERIALS"
WOULD BE USED TO PROTECT THE VEHICLES DURING SHIPMENT. THE USE OF SUCH
MATERIALS, OF COURSE, WOULD BE CONSISTENT WITH SHIPPING WEIGHT AND
DIMENSIONS EXCEEDING THE ACTUAL WEIGHT AND DIMENSIONS OF THE TRUCKS
THEMSELVES. THIS VIEW IS REINFORCED BY THE FACT THAT THE AGENCY'S OWN
ESTIMATED SHIPPING WEIGHT AND DIMENSIONS SET FORTH IN THE SHIPPING DATA
CLAUSE EXCEEDED THE SPECIFICATION REQUIREMENTS.
SECOND, THE RECORD SHOWS THAT HYSTER REQUESTED THE AGENCY DURING THE
SOLICITATION PROCESS TO INCREASE THE MAXIMUM WEIGHT OF THE TRUCKS FROM
30,000 POUNDS TO 30,800 POUNDS AND TO INCREASE THE HEIGHT FROM 120
INCHES TO 128 INCHES. THESE CHANGES WERE INCORPORATED INTO THE
SOLICITATION BY AMENDMENT. WE THINK IT HARDLY LIKELY THAT HYSTER WOULD
HAVE ASKED FOR THOSE CHANGES TO THE SPECIFICATIONS AND THEN OFFERED A
PRODUCT THAT WOULD NOT MEET THE SPECIFICATIONS REVISED AT ITS OWN
REQUEST.
ACCORDINGLY, WE DO NOT BELIEVE THE AGENCY ACTED UNREASONABLY IN
CONCLUDING THAT HYSTER DID NOT INTEND TO QUALIFY ITS BID BY THE
INFORMATION IT INCLUDED IN THE BID'S SHIPPING DATA CLAUSE.
THE PROTEST IS DENIED.
B-210666, AUG 26, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
INADVERTENT ACTION ON THE PART OF AN AGENCY
WHICH PRECLUDES A POTENTIAL SUPPLIER (EVEN
AN INCUMBENT CONTRACTOR) FROM SUBMITTING A
BID IS NOT A COMPELLING REASON FOR A RESOLICITATION
SO LONG AS ADEQUATE COMPETITION
AND REASONABLE PRICES WERE OBTAINED
AND THERE WAS NO DELIBERATE OR CONSCIOUS
ATTEMPT TO PRECLUDE THE POTENTIAL BIDDERS
FROM BIDDING.
CINEMA COLOR GROUP:
CINEMA COLOR GROUP (CINEMA) PROTESTS THE AWARD UNDER INVITATION FOR
BIDS (IFB) NO. DAVA-01-83-D-0011 ISSUED BY THE DEFENSE AUDIOVISUAL
AGENCY (DAVA) ON THE GROUND THAT IT WAS NOT SOLICITED TO BID.
WE DENY THE PROTEST.
THE IFB WAS FOR MOTION PICTURE PHOTOGRAPHIC LABORATORY PROCESSING AND
PRINTING SERVICES FOR SUPER 8-MM, 16-MM AND 35-MM RELEASE PRINTING.
DAVA CONTENDS THAT THE IFB WAS ADVERTISED UNDER THE HEADING OF
"PHOTOGRAPHIC EQUIPMENT" IN THE COMMERCE BUSINESS DAILY (CBD), BUT
CINEMA DID NOT PROTEST UNTIL AFTER AWARD. CINEMA CONTENDS THAT IT WAS
NOT AWARE OF THE ADVERTISEMENT BECAUSE THE PROCUREMENT IS NOT FOR
PHOTOGRAPHIC EQUIPMENT AND IT DOES NOT LOOK UNDER THAT HEADING FOR THE
TYPE OF PROCUREMENT INVOLVED. DAVA REPLIES THAT UNDER AGENCY
GUIDELINES, PHOTOGRAPHIC EQUIPMENT IS THE PROPER HEADING.
WE HAVE LONG HELD THAT INADVERTENT ACTION ON THE PART OF AN AGENCY
WHICH PRECLUDES A POTENTIAL SUPPLIER (EVEN AN INCUMBENT CONTRACTOR) FROM
SUBMITTING A BID IS NOT A COMPELLING REASON FOR A RESOLICITATION SO LONG
AS ADEQUATE COMPETITION AND REASONABLE PRICES WERE OBTAINED AND THERE
WAS NO DELIBERATE OR CONSCIOUS ATTEMPT TO PRECLUDE THE POTENTIAL BIDDERS
FROM BIDDING. MODULAR AMBULANCE CORPORATION; STAR-LINE ENTERPRISES,
INC., B-185043, JANUARY 27, 1976, 76-1 CPD 51. CINEMA DOES NOT SUGGEST
THAT THERE WAS INADEQUATE COMPETITION OR UNREASONABLE PRICES RECEIVED.
CINEMA'S CONTENTION IS THAT THERE WAS A DELIBERATE ATTEMPT TO PRECLUDE
IT FROM BIDDING.
IT IS UNFORTUNATE THAT CINEMA WAS UNAWARE OF THE PROCUREMENT BECAUSE
OF THE MANNER IN WHICH IT WAS ADVERTISED IN THE CBD. HOWEVER, THERE IS
NO SHOWING THAT THE PROCUREMENT WAS ADVERTISED IN THE MANNER IT WAS FOR
THE SPECIFIC PURPOSE OF CONCEALING IT FROM CINEMA.
WHILE CINEMA ATTEMPTS TO SHOW BY THE CONTRACTING AGENCY'S PRIOR
PROCUREMENT PRACTICES WITH CINEMA THAT THE CONTRACTING AGENCY MUST HAVE
BEEN ACTING IN BAD FAITH AGAINST CINEMA IN THE IMMEDIATE PROCUREMENT, WE
HAVE HELD THAT PRIOR PROCUREMENT PRACTICES DO NOT SUFFICE TO MEET THE
HIGH STANDARD OF PROOF REQUIRED TO SHOW BAD FAITH IN A SUBSEQUENT
PROCUREMENT. PHOTO DATA, INC., B-208272, MARCH 22, 1983, 83-1 CPD 281.
B-210663, FEB 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO DOES NOT REVIEW AN AFFIRMATIVE DETERMINATION OF
RESPONSIBILITY UNLESS THE PROTESTER SHOWS FRAUD OR BAD FAITH ON THE PART
OF PROCUREMENT OFFICIALS OR THE SOLICITATION CONTAINS DEFINITIVE
RESPONSIBILITY CRITERIA THAT ALLEGEDLY HAVE NOT BEEN APPLIED. TO SHOW
FRAUD OR BAD FAITH, THE PROTESTER MUST SUBMIT VIRTUALLY IRREFUTABLE
PROOF THAT PROCUREMENT OFFICIALS HAD A MALICIOUS AND SPECIFIC INTENT TO
HARM THE PROTESTER.
2. GAO DOES NOT REVIEW WHETHER AN OFFEROR IS A REGULAR DEALER OR
MANUFACTURER UNDER THE WALSH-HEALEY ACT, SINCE BY LAW THE MATTER IS FOR
THE CONTRACTING AGENCY'S DETERMINATION SUBJECT TO FINAL REVIEW BY THE
SMALL BUSINESS ADMINISTRATION (IF A SMALL BUSINESS IS INVOLVED) AND THE
SECRETARY OF LABOR.
J.F.BARTON CONTRACTING CO.:
J.F.BARTON CONTRACTING CO. PROTESTS THE ARMY CORPS OF ENGINEERS'
AWARDING A CONTRACT TO SOUTHERN CONCRETE SERVICES, INC. UNDER INVITATION
FOR BIDS NO. DACW29-83-B-0009. ACCORDING TO BARTON, THE CONTRACT
REQUIRES THE SPECIALIZED MANUFACTURE OF 240,000 ARTICULATED CONCRETE
MATTRESSES. ALLEGING THAT SOUTHERN CONCRETE NEVER HAS MANUFACTURED
THESE ITEMS BEFORE AND LACKS THE NECESSARY EXPERTISE AND SKILL TO DO SO
NOW, THE PROTESTER ARGUES THAT THE CONTRACTING OFFICER LACKED
INFORMATION SUFFICIENT TO DEMONSTRATE SOUTHERN CONCRETE'S RESPONSIBILITY
(THE ABILITY TO PERFORM THE CONTRACT). THE PROTESTER CONTENDS THE
CONTRACTING OFFICER'S AFFIRMATIVE RESPONSIBILITY DETERMINATION THEREFORE
WAS ARBITRARY AND CAPRICIOUS. THE PROTESTER ALSO CONTENDS THAT SOUTHERN
CONCRETE IS NOT A MANUFACTURER OR REGULAR DEALER OF THESE ITEMS AS
REQUIRED BY THE WALSH-HEALEY ACT, 41 U.S.C. SECS. 35-45 (1976).
WE DISMISS THE PROTEST.
THE DETERMINATION OF WHETHER A FIRM CAN MEET ITS LEGAL OBLIGATIONS IF
ITS BID IS ACCEPTED NECESSARILY IS A SUBJECTIVE BUSINESS JUDGMENT FOR
THE PROCURING OFFICIALS, WHO MUST BEAR THE CONSEQUENCES OF CONTRACT
PERFORMANCE DEFICIENCIES, AND THUS IS NOT READILY SUSCEPTIBLE TO OUR
REVIEW. MAYFAIR CONSTRUCTION COMPANY, 58 COMP.GEN. 105 (1978), 78-2 CPD
372; CONDIESEL MOBILE EQUIPMENT DIVISION, B-201568, SEPTEMBER 29, 1982,
82-2 CPD 294. WE THEREFORE DO NOT REVIEW AFFIRMATIVE RESPONSIBILITY
DETERMINATIONS UNLESS THERE IS A SHOWING OF POSSIBLE FRAUD OR BAD FAITH
ON THE PART OF PROCUREMENT OFFICIALS, OR THE SOLICITATION CONTAINS
DEFINITIVE RESPONSIBILITY CRITERIA THAT ALLEGEDLY HAVE NOT BEEN APPLIED.
SUNAIR ELECTRONICS, INC., B-208385, AUGUST 18, 1982, 82-2 CPD 154. THE
PROTESTER HAS NOT SHOWN THAT EITHER EXCEPTION APPLIES HERE.
THE MERE FACT THAT A PROTESTER DISAGREES WITH A CONTRACTING OFFICER'S
DETERMINATION OF RESPONSIBILITY, OR ALLEGES THAT THE CONTRACTING OFFICER
LACKED SUFFICIENT INFORMATION TO DETERMINE A BIDDER RESPONSIBLE, DOES
NOT SHOW THAT THE CONTRACTING OFFICER ACTED FRAUDULENTLY OR IN BAD
FAITH. CONTRACTING OFFICIALS ARE PRESUMED TO ACT IN GOOD FAITH, AND IN
ORDER TO SHOW OTHERWISE THE PROTESTER MUST SUBMIT VIRTUALLY IRREFUTABLE
PROOF THAT THEY HAD A MALICIOUS AND SPECIFIC INTENT TO HARM THE
PROTESTER. ARLANDRIA CONSTRUCTION CO., INC. - RECONSIDERATION,
B-195044; B-195510, JULY 9, 1980, 80-2 CPD 21. BARTON'S PROTEST
SUBMISSION DOES NOT SUFFICE TO MEET THE HIGH STANDARD OF PROOF REQUIRED
TO SHOW FRAUD OR BAD FAITH, AND SINCE THERE ARE NO DEFINITIVE
RESPONSIBILITY CRITERIA INVOLVED HERE, WE WILL NOT CONSIDER TH PROTEST
AS IT RELATES TO THE AWARDEE'S RESPONSIBILITY.
FURTHERMORE, OUR OFFICE DOES NOT CONSIDER QUESTIONS ABOUT WHETHER A
BIDDER IS A REGULAR DEALER OR MANUFACTURER WITHIN THE MEANING OF THE
WALSH-HEALEY ACT. BY LAW, SUCH MATTERS ARE FOR DETERMINATION BY THE
CONTRACTING AGENCY IN THE FIRST INSTANCE, SUBJECT TO FINAL REVIEW BY THE
SMALL BUSINESS ADMINISTRATION (IF A SMALL BUSINESS IS INVOLVED) AND THE
SECRETARY OF LABOR. SUNAIR ELECTRONICS, INC., SUPRA; SEE DEFENSE
ACQUISITION REGULATION SEC. 12-604 (1976 ED.).
THE PROTEST IS DISMISSED.
B-210660, SEP 27, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
AN EMPLOYEE OF NAVY REPORTED TO DUTY AT
VARIOUS WORKSITES WITHOUT REPORTING FIRST
TO HIS NEARBY HEADQUARTERS. HE RESIDED AT
TEMPORARY LODGINGS IN THAT AREA AND CLAIMS
MILEAGE TO AND FROM HIS PERMANENT RESIDENCE
WHICH DURING THE PERIOD OF THE CLAIM, HE
VISITED TWICE EACH WEEK. THE EMPLOYEE MAY
NOT BE PAID MILEAGE FOR TRAVEL BETWEEN A
DISTANT RESIDENCE TO WHICH HE DOES NOT COMMUTE
ON A DAILY BASIS AND AN ALTERNATE WORKSITE
IN THE VICINITY OF HIS HEADQUARTERS
STATION.
JOE B. KNIGHT:
THE ISSUE PRESENTED IN THIS CASE IS WHETHER A CIVILIAN EMPLOYEE OF
THE DEPARTMENT OF THE NAVY IS ENTITLED TO MILEAGE FOR TRAVEL TWICE A
WEEK BETWEEN HIS RESIDENCE AND AN ALTERNATE WORKSITE NEAR HIS
HEADQUARTERS WHEN HE DOES NOT REPORT TO HIS HEADQUARTERS. ON DAYS HE
DID NOT RETURN TO HIS RESIDENCE HE SECURED TEMPORARY ACCOMMODATIONS IN
THE VICINITY OF HIS HEADQUARTERS AND ALTERNATE WORKSITE. THE EMPLOYEE
IS NOT ENTITLED TO MILEAGE BETWEEN HIS DISTANT RESIDENCE AND THE
ALTERNATE WORKSITE IN THE VICINITY OF HIS HEADQUARTERS.
MR. JOE B. KNIGHT APPEALS THE SETTLEMENT OF OUR CLAIMS GROUP WHICH
DENIED HIS CLAIM FOR A MILEAGE ALLOWANCE FOR TRAVEL BETWEEN HIS
RESIDENCE IN NEW BERN, NORTH CAROLINA, AND HIS DUTY STATION AT LITTLE
CREEK, VIRGINIA. FOR THE PAST SEVERAL YEARS, MR. KNIGHT HAS BEEN
EMPLOYED BY THE SUPERINTENDENT OF SHIPBUILDING, CONVERSION AND REPAIR,
UNITED STATES NAVY, PORTSMOUTH, VIRGINIA. INSTEAD OF REPORTING TO
PORTSMOUTH OR ANY SINGLE LOCATION, HE HAS REPORTED DIRECTLY TO DIFFERENT
REPAIR FACILITIES.
FROM MAY 1979 UNTIL MARCH 1981, MR. KNIGHT WAS TEMPORARILY ASSIGNED
DUTY AT NEW BERN, NORTH CAROLINA, APPROXIMATELY 145 MILES FROM HIS
HEADQUARTERS IN PORTSMOUTH. DURING THIS ASSIGNMENT, HE PURCHASED A
RESIDENCE IN NEW BERN. FROM MARCH 30 UNTIL AUGUST 31, 1981, HE WAS
ASSIGNED TO NAVAL AMPHIBIOUS BASE, LITTLE CREEK, VIRGINIA. ON SEPTEMBER
1, 1981, HE WAS ASSIGNED TO NORFOLK SHIPBUILDING AND DRYDOCK COMPANY,
NORFOLK, VIRGINIA. BOTH LITTLE CREEK AND NORFOLK ARE LESS THAN 25 MILES
FROM PORTSMOUTH. MR. KNIGHT DECLARES THAT HE CHANGED HIS PERMANENT
RESIDENCE FROM THE AREA AROUND HIS PERMANENT STATION AT PORTSMOUTH (THE
TIDEWATER AREA) TO NEW BERN ON APRIL 30, 1981, I.E., 1 MONTH FOLLOWING
THE TERMINATION OF HIS ASSIGNMENT TO NEW BERN WHILE HE WAS WORKING IN
THE TIDEWATER AREA.
MR. KNIGHT FILED A CLAIM FOR REIMBURSEMENT OF MILEAGE FOR THE USE OF
A PRIVATELY OWNED AUTOMOBILE BETWEEN NEW BERN, NORTH CAROLINA, AND
LITTLE CREEK, VIRGINIA. ALTHOUGH MILEAGE WAS INITIALLY APPROVED BY A
NAVY OFFICIAL AS ADVANTAGEOUS TO THE GOVERNMENT, PAYMENT WAS NOT MADE
BECAUSE OF THE ABSENCE OF SPECIFIC GUIDELINES REGARDING COMMUTING
DISTANCE.
UPON REVIEW OF THE CLAIM, THE COMMANDER OF THE NAVY ACCOUNTING AND
FINANCE CENTER DENIED PAYMENT BECAUSE THE ASSIGNMENTS WERE NOT
CONSIDERED INCIDENTAL TO TEMPORARY DUTIES. HE TRANSMITTED THE CLAIM,
HOWEVER, TO OUR CLAIMS GROUP BECAUSE DOUBT EXISTED AS TO WHETHER THE
ASSIGNED WORKSITES WERE REGULAR PLACES OF DUTY OR TEMPORARY DUTY
STATIONS.
IN THE PRESENT CASE, MR. KNIGHT DID NOT NORMALLY REPORT TO
PORTSMOUTH, WHICH HAD BEEN ADMINISTRATIVELY DESIGNATED AS HIS OFFICIAL
DUTY STATION, BUT HE REPORTED DIRECTLY TO WORKSITES SUCH AS LITTLE
CREEK, SOMETIMES TRAVELING TO AND FROM HIS RESIDENCE IN NEW BERN AND
SOMETIMES TRAVELING TO AND FROM TEMPORARY LODGING IN THE TIDEWATER AREA.
UNDER VOLUME 2 OF THE JOINT TRAVEL REGULATIONS, AN EMPLOYEE IS
ENTITLED TO REIMBURSEMENT OF MILEAGE FOR THE DISTANCE TRAVELED BETWEEN
HIS "PLACE OF ABODE" AND AN ALTERNATE DUTY POINT, PROVIDED THAT THE USE
OF HIS PRIVATELY OWNED VEHICLE IS AUTHORIZED OR APPROVED AS ADVANTAGEOUS
TO THE GOVERNMENT. THIS MILEAGE ALLOWANCE FOR TRAVEL BETWEEN THE
EMPLOYEE'S RESIDENCE AND HIS PLACE OF TEMPORARY ASSIGNMENT IS AUTHORIZED
EVEN THOUGH THE EMPLOYEE DOES NOT FIRST REPORT TO HIS HEADQUARTERS. 2
JTR, PARA. C2153. THAT REGULATION ALSO DEFINES AN "ALTERNATE DUTY
POINT" AS A PLACE OF DUTY "WITHIN OR OUTSIDE THE EMPLOYEE'S PERMANENT
DUTY STATION OTHER THAN HIS REGULAR PLACE OF WORK."
THE SITUATION APPLICABLE TO EMPLOYEES OF THE SUPERVISOR OF
SHIPBUILDING, CONVERSION AND REPAIR, WHO PERFORM DUTIES SIMILAR TO THOSE
PERFORMED BY MR. KNIGHT IS UNUSUAL. THESE EMPLOYEES SPEND LITTLE TIME
AT THE DESIGNATED HEADQUARTERS IN PORTSMOUTH BUT ARE ASSIGNED TO VARIOUS
CONTRACTOR AND OTHER SHIPBUILDING AND REPAIR LOCATIONS FOR PERIODS OF
SEVERAL MONTHS AT A TIME. APPARENTLY MOST OF THE LOCATIONS AT WHICH
ASSIGNMENTS ARE PERFORMED ARE IN THE TIDEWATER AREA AND WITHIN
REASONABLE COMMUTING DISTANCE OF PORTSMOUTH AND RESIDENTIAL COMMUNITIES
IN AND AROUND PORTSMOUTH. HOWEVER, SOME ASSIGNMENTS ARE IN LOCATIONS
OUTSIDE THE TIDEWATER AREA AND NOT IN REASONABLE COMMUTING DISTANCE
THEREOF. WHEN EMPLOYEES ARE ASSIGNED TO THESE AREAS THEY ARE PLACED ON
TEMPORARY DUTY WITH APPROPRIATE SUBSISTENCE ALLOWANCES. WHILE WORKING
IN THE TIDEWATER AREA AND NOT AT HEADQUARTERS EMPLOYEES ARE AUTHORIZED
MILEAGE ON THE BASIS THAT THEY ARE WORKING AT ALTERNATE DUTY LOCATIONS.
MILEAGE IS PAID FROM THE EMPLOYEE'S RESIDENCE TO THE DUTY LOCATION EACH
DAY.
IN THE PRESENT CASE, IT APPEARS THAT MR. KNIGHT HAD AN UNUSUALLY LONG
ASSIGNMENT IN NEW BERN JUST PRIOR TO THE PERIOD COVERED BY THIS CLAIM.
IN SPITE OF THE LENGTH OF TIME HE WAS SO ASSIGNED HE WAS KEPT IN A
TEMPORARY DUTY STATUS. WHEN REASSIGNED TO JOBS IN THE TIDEWATER AREA HE
ASSERTED A RIGHT TO MILEAGE FOR COMMUTING TO NEW BERN ON THE BASIS THAT
IT IS HIS ONLY RESIDENCE SINCE THE ACCOMMODATIONS HE ACQUIRES FROM TIME
TO TIME IN THE TIDEWATER AREA ARE TEMPORARY IN NATURE.
IN OUR DISCUSSIONS CONCERNING PAYMENT OF MILEAGE FROM AN EMPLOYEE'S
RESIDENCE TO AN ALTERNATE WORKSITE THE EMPLOYEE'S RESIDENCE HAS USUALLY
BEEN IN THE VICINITY OF HIS HEADQUARTERS - A RESIDENCE FROM WHICH HE
COMMUTES ON A DAILY BASIS. IN A CASE INVOLVING AN EMPLOYEE'S TRAVEL ON
WEEKENDS TO HIS FAMILY RESIDENCE WE HELD THAT MILEAGE COULD BE PAID ONLY
BETWEEN THE PLACE NEAR HIS WORKSITES WHERE HE STAYED DURING THE WEEK AND
NOT HIS FAMILY RESIDENCE ON WEEKENDS. MATTER OF SCHWAPPACH, B-201361,
DECEMBER 30, 1981. SEE ALSO MATTER OF MORGAN, 55 COMP.GEN. 1323
(1976). THE RESULT IN MORGAN WAS RECONSIDERED AND CHANGED BECAUSE THE
EMPLOYEE RESIDED IN TEMPORARY MOTEL ACCOMMODATIONS ON HIS INFREQUENT
VISITS TO HIS HEADQUARTERS. MATTER OF MORGAN, 57 COMP.GEN. 32 (1977).
HOWEVER, WHILE HE WAS ALLOWED MILEAGE FOR TRAVEL WITHIN 25 MILES OF HIS
HEADQUARTERS, HE WAS NOT ALLOWED MILEAGE FOR THE FULL DISTANCE FROM
HEADQUARTERS TO HIS FAMILY RESIDENCE 103 MILES DISTANT. THUS, WHILE
THAT CASE IS DISTINGUISHED FROM THE SITUATION HERE BECAUSE MR. KNIGHT IS
USUALLY ASSIGNED TO WORKSITES IN THE VICINITY OF HIS HEADQUARTERS, EVEN
IF THAT WERE NOT SO, IT WOULD NOT SUPPORT HIS CLAIM FOR MILEAGE TO NEW
BERN.
THEREFORE, EVEN THOUGH AN EMPLOYEE MAY NOT HAVE ESTABLISHED A
PERMANENT RESIDENCE IN THE VICINITY OF HIS HEADQUARTERS, HE IS NOT
ENTITLED TO THE COST OF TRAVEL ONCE OR TWICE A WEEK FROM A DISTANT
RESIDENCE TO AN ALTERNATE WORK LOCATION IN THE VICINITY OF HIS
HEADQUARTERS.
WE ARE NOT IN A POSITION AT THIS TIME TO EVALUATE OTHER SITUATIONS
WHICH MAY OCCUR WITH RESPECT TO EMPLOYEES OF THE SUPERVISOR OF
SHIPBUILDING, CONVERSION AND REPAIR, AT PORTSMOUTH. BUT IT IS CLEAR
THAT AN EMPLOYEE WHO MAINTAINS A RESIDENCE A LONG DISTANCE AWAY FROM
PORTSMOUTH CANNOT CLAIM MILEAGE FOR THE TWICE WEEKLY TRIPS TO THAT
PLACE. MILEAGE WOULD BE PAYABLE FROM THE EMPLOYEE'S TEMPORARY RESIDENCE
OR LODGING IN THE AREA OF PORTSMOUTH ON ANY DAY HE WAS ASSIGNED TO AN
ALTERNATE DUTY SITE IN THE TIDEWATER AREA. BUT TRAVEL TO THE REMOTE
RESIDENCE ONCE OR TWICE A WEEK IS A RESPONSIBILITY OF THE EMPLOYEE NOT
RELATED TO HIS HEADQUARTERS OR HIS ALTERNATE DUTY LOCATION.
ACCORDINGLY, THE CLAIMS GROUP'S DISALLOWANCE OF MR. KNIGHT'S CLAIM IS
SUSTAINED.
FILE: B-210659
DATE: September 30, 1985
MATTER OF: Lieutenant Colonel John W. Larkin III, USAF
DIGEST
TRANSPORTATION - HOUSEHOLD EFFECTS - MILITARY PERSONNEL - PACKING,
CRATING, DRAYAGE, ETC. - PACKING ALLOWANCE - REGULATIONS
Air Force Regulation 75-25, establishing a 10 percent packing
allowance for household goods shipped by the direct procurement method,
is valid even though subparagraph M8002-3a, 1 JTR, prescribes a 20
percent packing allowance for household goods shipped by container. The
20 percent packing allowance applies when the weight of empty shipping
boxes excludes packing materials. It does not apply when the weight of
the shipping boxes or transporters includes the weight of materials
necessary for preparing the goods for shipment. In that case the 10
percent allowance prescribed by the Air Force is appropriate. The 10
percent allowance is applicable in the present case because, in the
absence of proof to the contrary, it is assumed that the tare weight
prescribed by regulation to include packing materials was used.
The claimant has asked for reconsideration of our decision Lieutenant
Colonel John W. Larkin III, USAF, B-210659, September 5, 1984, regarding
the packing allowance applicable to the shipment of his household goods
from Tinker Air Force Base, Oklahoma, to Bangkok, Thailand, effective
April 1980. The Air Force applied the 10 percent packing allowance
prescribed in their regulations. Colonel Larkin argues that the 20
percent packing allowance shown in paragraph M8002-3a, Volume 1, Joint
Travel Regulations (1 JTR), should be applied. Since Colonel Larkin has
not provided evidence to establish that the facts which were relied upon
in the decision were incorrect or that the application of the lower
allowance was contrary to controlling regulations, our decision of
September 5, 1984, is affirmed.
Background
Ascertaining the correct packing allowance is critical in Colonel
Larkin's case because the total weight of the household goods shipped
plus the weight of goods stored at Government expense exceeded his total
weight allowance. As a result of the excess weight, he paid part of the
cost for nontemporary storage of his household goods. He would have
been required to pay less had the 20 percent packing allowance shown in
paragraph M8002-3a, 1 JTR, been applied to his shipment rather than the
10 percent packing allowance established by the Secretary of the Air
Force in Air Force Regulation (AFR) 75-25, July 9, 1976.
Colonel Larkin was entitled to ship or store 13,000 pounds of
household goods incident to his transfer. 1 JTR para. M8003. This
weight allowance is applied to the actual weight of the unpacked and
uncrated goods and that actual weight, without packing materials, is to
be used in determining whether the member has exceeded his weight
allowance. 1 JTR para. M8002-1. The 20 percent packing allowance in
paragraph M8002-3a applies when the actual weight of the unpacked and
uncrated household goods is unknown and when the weight of the empty
shipping boxes or transporters used to transport the shipment (tare
weight) is subtracted from the gross weight of the shipment. The 20
percent allowance, to account for all the packing materials used in the
shipping boxes, is subtracted from that result to approximate the actual
weight of the goods. We held that since the weighing procedures used in
connection with direct procurement method shipment, which was used in
Colonel Larkin's case, required that some of the packing materials be
included with the weight of the shipping boxes (tare weight) when that
weight was subtracted from the gross weight of the shipment, it was not
appropriate to apply the full 20 percent packing allowance. We
therefore approved the 10 percent packing allowance which was applied by
the Air Force. Colonel Larkin argues that packing materials were not
included as part of the tare weight.
Inclusion of Packing Materials in the Tare Weight
Our decision of September 5, 1984, quoted Regulation 4500.34-R, which
was applicable to the type of shipment involved. That regulation
clearly required the inclusion of some packing materials with the weight
of the empty shipping boxes to determine the tare weight. Since that
regulation prescribes the overall procedures used in the Department of
Defense for moving household goods, it was considered to be applicable
to Colonel Larkin's shipment. The Military Standard 212 which Colonel
Larkin refers to describes particular packing methods and weighing
procedures to be used in preparing direct procurement method shipments.
Although not discussed in our decision, the methods and procedures
described therein at the time of Colonel Larkin's shipment also included
packing material with the weight of the empty shipping boxes in the tare
weight the contractor was required to report to the Government.
MIL-STD-212C, para. 3.11, pg. 5, June 1, 1970. The Air Force applied
the 10 percent packing allowance because it had concluded that the
weight of the household goods as recorded by the packing contractor was
not based upon the gross weight of the shipment less the weight of the
empty shipping boxes or transporters, but was based on the gross weight
of the shipment less the weight of the shipping boxes or transporters
and the weight of the packing materials required to prepare the goods
for shipment. We explained that the 20 percent packing allowance did
not govern Colonel Larkin's shipment because that allowance was not
based on the weighing procedures used for Colonel Larkin's shipment.
The Secretary's 10 percent packing allowance was approved because it was
based on the weighing procedures that were then applicable.
Colonel Larkin attached the shipping company's records which show
that the contractor's "tare" weight was the same as the "empty weight"
of the container listed on another form. According to Colonel Larkin,
this proves that the tare weight included no packing material.
These records, which were part of the file when we previously
considered the claim, fail to prove Colonel Larkin's point since there
is no indication that the term "empty weight" used on the contractor's
form excludes packing materials. The term "empty weight" in this
context is at best ambiguous. We do not view it as showing that the
weights reported as the net weight of the household goods included no
packing and bracing materials, contrary to the requirements of the
regulations applicable to the packing and weighing of this type of
shipment. Thus, since we have no direct information regarding the
procedure used when Colonel Larkin's household goods were weighed, we
must assume that the weights given were arrived at through the use of
applicable weighing procedures.
The Air Force 10 Percent Packing Allowance
Colonel Larkin presented for our consideration a statement by the
former Chief of the Air Force Entitlements Division who was directly
involved in recent deliberations of the Department of Defense regarding
the appropriate packing allowance. This statement provides some
background information concerning the development of military packing
allowances, but appears to have no direct relevance to the issues here.
The statement also suggests that allowances are to be uniform among
the services. We recognize that the allowances authorized military
personnel for travel and transportation are to be coordinated so that,
as far as possible, they are uniform for all the services. This
procedure, however, does not prevent an individual service from
prescribing additional regulations not incompatible with the
service-wide regulations to cover special situations. The Air Force
regulation in this case was considered valid because it did just that.
It authorized an appropriate allowance for packing materials to be
applied in a situation not covered by service-wide regulation.
In a letter of March 26, 1985, the Department of Defense concurred in
the decision rendered in Colonel Larkin's case based on the
circumstances involved and recommended that the other services apply a
10 percent allowance when packing and bracing materials are included as
part of the tare weight to be subtracted from the gross weight of the
shipment. That letter also indicates that all regulations prescribing
weighing and packing procedures governing packing contractors for direct
procurement method shipments have been clarified so that there will
normally be no shipments where the weight of packing materials is
included with weight of the empty container in determining the reported
tare weight.
Conclusion
For the reasons stated, Colonel Larkin is not entitled to
reimbursement for the charges he has paid incident to the nontemporary
storage of the excess weight of his household effects as determined by
the Air Force. Our decision of September 5, 1984, is affirmed.
Comptroller General of the United States
B-210659, SEP 5, 1984
TRANSPORTATION - HOUSEHOLD EFFECTS - MILITARY PERSONNEL - PACKING,
CRATING, DRAYAGE, ETC. - REGULATIONS
DIGEST:
THE SECRETARY OF THE AIR FORCE CREATED A 10 PERCENT PACKING ALLOWANCE
IN AIR FORCE REGULATION 75-25 FOR HOUSEHOLD GOODS SHIPPED BY THE DIRECT
PROCUREMENT METHOD EVEN THOUGH SUBPARAGRAPH M8002-3A, 1 JTR PRESCRIBES A
20 PERCENT PACKING ALLOWANCE FOR HOUSEHOLD GOODS SHIPPED BY THAT METHOD.
SINCE THE 20 PERCENT PACKING ALLOWANCE IS APPLICABLE WHEN THE WEIGHT
USED TO DETERMINE THE ACTUAL WEIGHT OF THE HOUSEHOLD GOODS IS THE GROSS
WEIGHT OF THE SHIPMENT LESS THE WEIGHT OF THE EMPTY SHIPPING BOXES OR
TRANSPORTERS, THAT ALLOWANCE IS NOT FOR APPLICATION WHEN THE WEIGHT USED
IS THE GROSS WEIGHT OF THE SHIPMENT LESS THE WEIGHT OF THE SHIPPING
BOXES OR TRANSPORTERS AND THE WEIGHT OF MATERIALS NECESSARY FOR
PREPARING THE GOODS FOR SHIPMENT. IN THE LATTER CASE THE 10 PERCENT
ALLOWANCE PRESCRIBED BY THE AIR FORCE IS APPROPRIATE.
LIEUTENANT COLONEL JOHN W. LARKIN 3D, USAF:
THE QUESTION PRESENTED IN THIS CASE IS WHETHER THE SECRETARY OF THE
AIR FORCE HAD AUTHORITY TO PRESCRIBE A 10 PERCENT PACKING ALLOWANCE IN
AIR FORCE REGULATION (AFR) 75-25, JULY 9, 1976, FOR A DIRECT PROCUREMENT
METHOD OF SHIPMENT OF HOUSEHOLD GOODS RATHER THAN APPLYING THE 20
PERCENT PACKING ALLOWANCE FOR SUCH SHIPMENTS OF HOUSEHOLD GOODS SHOWN IN
PARAGRAPH M8002-3A, VOLUME 1, JOINT TRAVEL REGULATIONS (JTR).
LIEUTENANT COLONEL JOHN W. LARKIN, 3D, USAF, CLAIMS REIMBURSEMENT OF
CHARGES HE PAID INCIDENT TO THE NONTEMPORARY STORAGE OF AN EXCESS WEIGHT
OF HOUSEHOLD GOODS WHICH WOULD NOT HAVE BEEN CONSIDERED EXCESS WEIGHT
HAD THE 20 PERCENT ALLOWANCE BEEN USED. THE SECRETARIES OF THE SERVICES
ARE AUTHORIZED TO SUPPLEMENT THE JTR BY ADMINISTRATIVE REGULATIONS BUT
THEY ARE BOUND BY THE SPECIFIC PROVISIONS OF THOSE REGULATIONS. IN THE
CIRCUMSTANCES PRESENTED WE FIND THAT THE SECRETARY OF THE AIR FORCE DID
NOT EXCEED HIS AUTHORITY IN ESTABLISHING THE 10 PERCENT ALLOWANCE.
ACCORDINGLY, COLONEL LARKIN'S CLAIM IS DENIED.
THE JOINT TRAVEL REGULATIONS ESTABLISH MAXIMUM WEIGHT ALLOWANCES FOR
HOUSEHOLD GOODS WHICH MAY BE SHIPPED AND STORED BY MEMBERS OF THE
SERVICES INCIDENT TO A PERMANENT CHANGE OF STATION. COLONEL LARKIN AS
AN OFFICER IN GRADE 05 WAS ENTITLED TO AN ALLOWANCE OF 13,000 POUNDS. 1
JTR PARA. M8003. THIS WEIGHT ALLOWANCE IS APPLIED TO THE ACTUAL WEIGHT
OF UNPACKED AND UNCRATED HOUSEHOLD GOODS AND THAT ACTUAL WEIGHT WITHOUT
PACKING MATERIALS IS TO BE USED IN DETERMINING WHETHER THE MEMBER HAS
EXCEEDED HIS WEIGHT ALLOWANCE. 1 JTR PARA. M8002-1. HOWEVER, FOR
CERTAIN TYPES OF SHIPMENTS OBTAINING THE ACTUAL WEIGHT IS NOT
PRACTICABLE AND OTHER METHODS OF DETERMINING THE WEIGHT MUST BE USED.
IN THIS REGARD, PARA. M8002-3A, 1 JTR, PROVIDES:
"A. STANDARD OVERSEAS SHIPPING BOXES. WHEN HOUSEHOLD GOODS ARE
SHIPPED BY THE DIRECT PROCUREMENT METHOD (DPM) IN STANDARD OVERSEAS
SHIPPING BOXES (E.G., TYPE II CONTAINERS OR GOVERNMENT-OWNED CONEX
TRANSPORTERS), AND THE ACTUAL WEIGHT OF THE UNPACKED AND UNCRATED
HOUSEHOLD GOODS IS NOT KNOWN, BUT THE GROSS WEIGHT AND THE WEIGHT OF THE
SHIPPING BOXES OR CONEX TRANSPORTERS IS KNOWN, AN ALLOWANCE WILL BE MADE
FOR THE WEIGHT OF INTERIOR PACKING AND BRACING MATERIALS USED IN THE
SHIPMENT. THE CHARGE AGAINST THE MEMBER'S PRESCRIBED WEIGHT ALLOWANCE
WILL BE DETERMINED BY REDUCING THE DIFFERENCE BETWEEN THE GROSS WEIGHT
OF THE CONTAINER WHEN LOADED AND THE STENCILED WEIGHT OF THE EMPTY
CONTAINER BY 20%. ***"
HOWEVER, AIR FORCE REGULATION 75-25, TABLE 5-1, PRESCRIBES A 10
PERCENT PACKING ALLOWANCE FOR SHIPMENTS OF HOUSEHOLD EFFECTS MOVING
UNDER THE DIRECT PROCUREMENT METHOD WHERE THE "CONTRACTORS RECORDED NET
WEIGHT IS KNOWN."
THE ACTUAL WEIGHT OF COLONEL LARKIN'S HOUSEHOLD GOODS WAS NOT KNOWN,
AND THE AIR FORCE APPLIED THE RULE IN REGULATION 75-25 REDUCING THE "NET
WEIGHT" OF THE HOUSEHOLD EFFECTS SHIPPED AND STORED BY 10 PERCENT TO
CALCULATE THE EXCESS WEIGHT OF THE HOUSEHOLD GOODS.
THE AIR FORCE APPLIED THE 10 PERCENT PACKING ALLOWANCE BECAUSE IT
CONCLUDED THAT THE WEIGHT OF THE HOUSEHOLD GOODS AS RECORDED BY THE
PACKING CONTRACTOR WAS NOT BASED UPON THE GROSS WEIGHT OF THE SHIPMENT
LESS THE WEIGHT OF THE EMPTY SHIPPING BOXES OR TRANSPORTERS, BUT WAS
BASED ON THE GROSS WEIGHT OF THE SHIPMENT LESS THE WEIGHT OF THE
SHIPPING BOXES OR TRANSPORTERS AND THE WEIGHT OF MATERIALS REQUIRED TO
PREPARE THE GOODS FOR SHIPMENT. THIS CONCLUSION WAS PREDICATED ON A
PROVISION IN DEPARTMENT OF DEFENSE REGULATION 4500.34-R WHICH PRESCRIBES
THE PROCEDURES USED BY THE DEPARTMENT OF DEFENSE IN SHIPPING HOUSEHOLD
GOODS. REGULATIONS APPLICABLE TO DIRECT PROCUREMENT METHOD SHIPMENTS
PROVIDE THAT:
"THE TARE WEIGHT WILL BE DETERMINED BY WEIGHING THE CONTAINERS AND
PACKING MATERIAL REQUIRED TO PREPARE THE SHIPMENT. THE NET WEIGHT WILL
BE DETERMINED BY WEIGHING THE CONTAINER AFTER IT IS COMPLETELY PACKED
AND SUBTRACTING THE TARE WEIGHT FROM THE GROSS WEIGHT." PARA. 7009,
REGULATION 4500.34-R.
THESE PROCEDURES OBVIOUSLY DO NOT PROVIDE FOR THE WEIGHT OF THE EMPTY
CONTAINER BUT FOR THE WEIGHT OF THE EMPTY CONTAINER PLUS THE PACKING
MATERIAL NECESSARY TO PREPARE THE HOUSEHOLD GOODS FOR SHIPMENT. THEY
INCLUDE THE WEIGHT OF SOME PACKING MATERIALS IN THE TARE WEIGHT WHEREAS
THE 20 PERCENT ALLOWANCE IN THE JTR ASSUMES THAT NO PACKING MATERIALS
WILL BE INCLUDED IN THE TARE WEIGHT. IN ORDER TO OBTAIN AN ACCURATE
WEIGHT FOR DETERMINING WHETHER AN INDIVIDUAL HAD EXCEEDED THE MAXIMUM
ENTITLEMENT THE AIR FORCE FELT IT WAS NECESSARY TO SUPPLEMENT THE JTR,
AND THE SECRETARY ESTABLISHED A 10 PERCENT PACKING ALLOWANCE. THAT
ALLOWANCE APPLIED TO THE DIRECT PROCUREMENT METHOD "CONTRACTORS RECORDED
NET WEIGHT." THE ALLOWANCE OF 10 PERCENT WAS JUSTIFIED SINCE THE NET
WEIGHT USING THIS METHOD APPARENTLY INCLUDES SOME PACKING MATERIALS--
THE BOXES AND CARTONS IN WHICH THE GOODS ARE PACKED-- BUT NOT INTERIOR
PADDING AND BRACING MATERIAL USED TO SECURE THE GOODS INSIDE THE
SHIPPING BOXES OR TRANSPORTERS. SINCE THE JTR PROVISION WHICH AUTHORIZES
A 20 PERCENT PACKING ALLOWANCE APPLIES TO DIRECT PROCUREMENT METHOD
SHIPMENTS WHEN ONLY THE WEIGHT OF THE EMPTY SHIPPING BOX OR TRANSPORTER
IS SUBTRACTED FROM THE GROSS WEIGHT, THAT PROVISION DOES NOT GOVERN
COLONEL LARKIN'S SHIPMENT. IN HIS CASE THE WEIGHT WHICH WAS TO BE
SUBTRACTED FROM THE GROSS WEIGHT INCLUDED ALSO INTERIOR PADDING AND
BRACING MATERIALS MAKING THE USE OF THE 10 PERCENT ALLOWANCE AS
PRESCRIBED BY THE AIR FORCE APPROPRIATE.
COLONEL LARKIN ARGUES THAT THE 20 PERCENT ALLOWANCE SHOULD BE APPLIED
TO MEMBERS OF THE AIR FORCE WHOSE GOODS ARE SHIPPED BY THE DIRECT
PROCUREMENT METHOD SINCE THE 20 PERCENT ALLOWANCE IS APPLIED TO SIMILAR
SHIPMENTS FOR MEMBERS OF THE OTHER SERVICES. HOWEVER, THE SECRETARIES
OF THE SERVICES ARE REQUIRED TO PRESCRIBE WEIGHT ALLOWANCES FOR SHIPMENT
OF HOUSEHOLD GOODS. THIS HAS BEEN DONE IN PARA. M8003, 1 JTR. WHILE IT
IS RECOGNIZED THAT THE EXACT WEIGHT OF A MEMBER'S HOUSEHOLD EFFECTS
CANNOT ALWAYS BE DETERMINED, THE REGULATIONS MUST BE APPLIED SO THAT THE
CALCULATION OF THE WEIGHT OF HOUSEHOLD GOODS RESULTS IN AN ACCURATE
ESTIMATE OF THE ACTUAL WEIGHT. A PROCEDURE WHICH WOULD, IN EFFECT,
INCREASE THE WEIGHT OF HOUSEHOLD GOODS SHIPPED BY APPLYING AN EXCESSIVE
PACKING ALLOWANCE WOULD AUTHORIZE EXCEEDING THE MAXIMUM WEIGHT
ALLOWANCES. AS INDICATED ABOVE IN COLONEL LARKIN'S CASE THE PACKING
ALLOWANCE AUTHORIZED BY THE AIR FORCE APPEARS TO RESULT IN A MORE
ACCURATE DETERMINATION OF THE WEIGHT OF THE UNPACKED HOUSEHOLD GOODS.
THEREFORE WE DO NOT FIND THAT THE APPLICATION OF THAT ALLOWANCE IS
UNFAIR. THE OTHER SERVICES SHOULD APPLY A SIMILAR ALLOWANCE TO DIRECT
PROCUREMENT METHOD SHIPMENTS WHEN PADDING AND BRACING MATERIALS ARE
INCLUDED AS PART OF THE WEIGHT WHICH IS SUBTRACTED FROM THE GROSS WEIGHT
OF THE SHIPMENT. WE ARE BRINGING THIS MATTER TO THE ATTENTION OF THE
SECRETARY OF DEFENSE WITH A RECOMMENDATION THAT HE TAKE ACTION TO SEEK
SIMILAR PACKING ALLOWANCES APPLICABLE TO THE OTHER SERVICES.
FOR THE REASONS STATED COLONEL LARKIN IS NOT ENTITLED TO
REIMBURSEMENT FOR THE CHARGES HE HAS PAID INCIDENT TO THE NONTEMPORARY
STORAGE OF THE EXCESS WEIGHT OF HIS HOUSEHOLD EFFECTS AS DETERMINED BY
THE AIR FORCE.
B-210657, MAY 25, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
THE CHAIRMAN OF THE NATIONAL CREDIT
UNION ADMINISTRATION (NCUA) WAS REIMBURSED
FOR RELOCATION EXPENSES HE INCURRED FOLLOWING
HIS APPOINTMENT TO THAT POSITION
IN 1981. PRIOR DECISION THAT CHAIRMAN
WAS NOT ENTITLED TO SUCH EXPENSES IS
AFFIRMED BECAUSE: (1) AT THE TIME OF
THE CHAIRMAN'S APPOINTMENT, THERE WAS
NO AUTHORITY IN 5 U.S.C. CHAPTER 57,
SUBCHAPTER II, FOR PAYMENT OF RELOCATION
EXPENSES TO PRESIDENTIAL APPOINTEES; (2) THE
NCUA'S OPERATING FUND CONSTITUTES AN
APPROPRIATED FUND, SUBJECT TO STATUTORY
RESTRICTIONS ON THE USE OF SUCH FUNDS; (3) IT
IS NOT MATERIAL THAT THE NCUA'S CENTRAL
LIQUIDITY FACILITY (CLF) REIMBURSED NCUA
FOR THE CHAIRMAN'S RELOCATION EXPENSES,
SINCE THE CHAIRMAN IS AN EMPLOYEE OF NCUA,
NOT CLF; AND (4) THE GOVERNMENT CANNOT BE
BOUND BY ERRONEOUS ADVICE PROVIDED TO THE
CHAIRMAN BY NCUA OFFICIALS.
EDGAR T. CALLAHAN - PAYMENT OF RELOCATION EXPENSES - RECONSIDERATION:
THE GENERAL COUNSEL OF THE NATIONAL CREDIT UNION ADMINISTRATION
(NCUA), ON BEHALF OF THE HONORABLE EDGAR T. CALLAHAN, CHAIRMAN OF THE
NCUA BOARD, REQUESTS RECONSIDERATION OF OUR DECISION IN EDGAR T.
CALLAHAN, B-210657, NOVEMBER 15, 1983 (63 COMP.GEN. 31). IN THAT
DECISION, WE HELD THAT MR. CALLAHAN WAS NOT ENTITLED TO BE REIMBURSED
FOR THE TRAVEL AND RELOCATION EXPENSES HE INCURRED IN REPORTING TO HIS
FIRST DUTY STATION. FOR THE REASONS STATED BELOW, WE AFFIRM OUR PRIOR
DECISION.
BACKGROUND
IN 1981, MR. CALLAHAN, WHO WAS NOT THEN A FEDERAL EMPLOYEE, WAS
APPOINTED TO THE POSITION OF CHAIRMAN, NCUA BOARD. THE THREE-MEMBER
NCUA BOARD IS APPOINTED BY THE PRESIDENT, BY AND WITH THE ADVICE AND
CONSENT OF THE SENATE. 12 U.S.C. SEC. 1752A (1982). THE CHAIRMAN'S
POSITION IS AT LEVEL III OF THE EXECUTIVE SCHEDULE. 5 U.S.C. SEC. 5314
(1982).
IN ANTICIPATION OF HIS CONFIRMATION, MR. CALLAHAN MOVED FROM
SPRINGFIELD, ILLINOIS, TO WASHINGTON, D.C., DURING THE MONTHS OF
OCTOBER, NOVEMBER, AND DECEMBER 1981. ON OCTOBER 23, 1981, NCUA'S BOARD
VOTED TO APPROVE PAYMENT OF RELOCATION EXPENSES INCURRED BY MR.
CALLAHAN AND HIS FAMILY ON THE BASIS THAT SUCH PAYMENT WAS NOT
SPECIFICALLY PRECLUDED BY CHAPTER 57 OF TITLE 5, UNITED STATES CODE, OR
THE FEDERAL TRAVEL REGULATIONS, FPMR 101-7, AND THAT IT WAS WITHIN THE
SCOPE OF SECTION 120(I)(2) OF THE FEDERAL CREDIT UNION ACT, 12 U.S.C.
SEC. 1766(I)(2). CONSEQUENTLY, NCUA PAID MR. CALLAHAN $21,250.37 TO
REIMBURSE HIM FOR THE SUBSISTENCE EXPENSES, COSTS OF SHIPPING HOUSEHOLD
GOODS, AND REAL ESTATE EXPENSES HE INCURRED IN MOVING TO WASHINGTON, D.
C.
IN OUR DECISION IN CALLAHAN, WE HELD THAT MR. CALLAHAN WAS NOT
ENTITLED TO BE REIMBURSED FOR RELOCATION EXPENSES SINCE, AS A GENERAL
RULE, AN EMPLOYEE MUST BEAR THE EXPENSES OF TRAVEL TO HIS FIRST DUTY
STATION IN THE ABSENCE OF A SPECIFIC STATUTE TO THE CONTRARY. SEE 58
COMP.GEN. 744, 746 (1979); AND 53 COMP.GEN. 313, 315 (1973). ONE
STATUTORY EXCEPTION TO THE GENERAL RULE IS CONTAINED IN 5 U.S.C. SEC.
5722, WHICH PROVIDES FOR REIMBURSEMENT OF TRAVEL AND TRANSPORTATION
EXPENSES INCURRED BY NEW APPOINTEES ASSIGNED TO OVERSEAS POSTS OF DUTY.
ANOTHER EXCEPTION IS PROVIDED BY 5 U.S.C. SEC. 5723, WHICH, AT THE TIME
OF MR. CALLAHAN'S APPOINTMENT, AUTHORIZED REIMBURSEMENT FOR CERTAIN
RELOCATION EXPENSES INCURRED BY NEW APPOINTEES SERVING IN SENIOR
EXECUTIVE SERVICE (SES) AND MANPOWER SHORTAGE POSITIONS. FN1
SINCE MR. CALLAHAN WAS NOT ASSIGNED OVERSEAS OR APPOINTED TO AN SES
OR MANPOWER SHORTAGE POSITION, WE CONCLUDED THAT NCUA HAD NO AUTHORITY
TO REIMBURSE HIM FOR THE MOVING EXPENSES HE INCURRED IN CONNECTION WITH
HIS APPOINTMENT.
AS PART OF OUR DETERMINATION IN CALLAHAN, WE RESPONDED TO SEVERAL
ARGUMENTS PRESENTED BY THE GENERAL COUNSEL OF NCUA ON BEHALF OF MR.
CALLAHAN. SPECIFICALLY, THE GENERAL COUNSEL ARGUED THAT NCUA IS NOT AN
APPROPRIATED FUND ACTIVITY SUBJECT TO 5 U.S.C. CHAPTER 57, SUBCHAPTER
II, AND, THEREFORE, THAT IT HAD INDEPENDENT AUTHORITY UNDER SECTION
120(I)(2) OF THE FEDERAL CREDIT UNION ACT, 12 U.S.C. SEC. 1766(I)(2), TO
REIMBURSE MR. CALLAHAN FOR MOVING EXPENSES. THE RELEVANT PART OF 12
U.S.C. SEC. 1766(I)(2) AUTHORIZES NCUA TO EXPEND ITS OPERATING FUND "AS
IT MAY BE NECESSARY AND APPROPRIATE" TO CARRY OUT THE PROVISIONS OF THE
FEDERAL CREDIT UNION ACT. ADDITIONALLY, THE GENERAL COUNSEL STATED THAT
THE INITIAL CHARGE TO NCUA'S OPERATING FUND FOR MR. CALLAHAN'S MOVING
EXPENSES HAD BEEN TRANSFERRED TO THE ACCOUNTS OF NCUA'S CENTRAL
LIQUIDITY FACILITY (CLF), A GOVERNMENT-CONTROLLED CORPORATION NOT
SUBJECT TO THE PROVISIONS OF 5 U.S.C. CHAPTER 57, SUBCHAPTER II.
IN OUR PRIOR DECISION WE DETERMINED THAT MR. CALLAHAN'S ENTITLEMENT
TO RELOCATION EXPENSES WAS GOVERNED BY THE PROVISIONS OF 5 U.S.C.
CHAPTER 57, SUBCHAPTER II, SINCE NCUA IS AN "EXECUTIVE AGENCY" FOR
PURPOSES OF 5 U.S.C. SEC. 5721(1). FURTHERMORE, WE FOUND THAT NCUA'S
SPENDING AUTHORITY UNDER 12 U.S.C. SEC. 1766 IS CIRCUMSCRIBED BY 5 U.S.
C. CHAPTER 57, SUBCHAPTER II, BECAUSE THE OPERATING FUND CONSTITUTES AN
APPROPRIATED FUND WHICH IS SUBJECT TO STATUTORY RESTRICTIONS ON THE USE
OF APPROPRIATED MONIES. FINALLY, WE STATED THAT CLF'S ASSUMPTION OF THE
CHARGE FOR MR. CALLAHAN'S RELOCATION EXPENSES HAD NO BEARING ON HIS
ENTITLEMENT TO SUCH EXPENSES SINCE MR. CALLAHAN MUST BE REGARDED AS AN
EMPLOYEE OF NCUA, NOT CLF. ACCORDINGLY, WE CONCLUDED THAT MR. CALLAHAN
WAS INDEBTED FOR THE RELOCATION EXPENSES PAID TO HIM.
DISCUSSION
APPROPRIATED FUNDS
THE GENERAL COUNSEL RENEWS HIS CONTENTION THAT NCUA HAS INDEPENDENT
AUTHORITY UNDER 12 U.S.C. SEC. 1766 TO REIMBURSE MR. CALLAHAN'S MOVING
EXPENSES BECAUSE THE NCUA IS NOT AN APPROPRIATED FUND ACTIVITY SUBJECT
TO 5 U.S.C. SECS. 5722, 5723, AND OTHER PROVISIONS IN 5 U.S.C. CHAPTER
57, SUBCHAPTER II, WHICH APPLY ONLY TO PAYMENTS FROM APPROPRIATED FUNDS.
IN SUPPORT OF THIS POSITION, HE STATES THAT NCUA DOES NOT RECEIVE
ANNUAL APPROPRIATIONS FROM CONGRESS, BUT IS FINANCED EXCLUSIVELY THROUGH
ANNUAL OPERATING FEES WHICH NCUA COLLECTS FROM FEDERAL CREDIT UNIONS
UNDER THE AUTHORITY OF 12 U.S.C. SEC. 1755. THE GENERAL COUNSEL STATES
THAT, UNDER 12 U.S.C. SEC. 1755, THE FEES WHICH ARE COLLECTED BY NCUA
AND DEPOSITED INTO A SPECIAL FUND IN THE TREASURY ARE AVAILABLE FOR
EXPENDITURE ONLY BY THE NCUA BOARD. SINCE THE TREASURY HAS LITTLE
CONTROL OVER THE EXPENDITURE OR INVESTMENT OF NCUA'S OPERATING FUND, THE
GENERAL COUNSEL ARGUES THAT THE FUND MUST BE REGARDED AS A
NONAPPROPRIATED FUND.
IT IS TRUE THAT NCUA'S OPERATING FUND IS SEPARATE FROM THE GENERAL
FUND OF THE TREASURY, AND ENABLES NCUA TO OPERATE ON A SELF-SUFFICIENT
BASIS WITHOUT ANNUAL APPROPRIATIONS. NEVERTHELESS, AS WE EXPLAINED IN
OUR PRIOR DECISION, IT IS CLEAR FROM THE LANGUAGE OF 12 U.S.C. SEC.
1755 THAT THE OPERATING FUND CONSTITUTES AN APPROPRIATED FUND FOR
PURPOSES OF STATUTORY RESTRICTIONS AND LIMITATIONS ON THE USE OF
APPROPRIATED MONIES. SECTION 1755, WHICH AUTHORIZES THE COLLECTION OF
ANNUAL OPERATING FEES FROM FEDERAL CREDIT UNIONS, PROVIDES FOR THE
DISPOSITION OF THOSE FEES AS FOLLOWS:
"(D) PAYMENT INTO TREASURY OF UNITED STATES
"ALL OPERATING FEES SHALL BE DEPOSITED
WITH THE TREASURER OF THE UNITED STATES FOR
THE ACCOUNT OF THE ADMINISTRATION AND MAY BE
EXPENDED BY THE BOARD TO DEFRAY THE EXPENSES
INCURRED IN CARRYING OUT THE PROVISIONS OF
THIS CHAPTER INCLUDING THE EXAMINATION AND
SUPERVISION OF FEDERAL CREDIT UNIONS."
IT IS WELL SETTLED THAT STATUTES WHICH AUTHORIZE THE COLLECTION AND
CREDIT OF FEES TO A PARTICULAR FUND, AND WHICH MAKE THE FUND AVAILABLE
FOR A SPECIFIC PURPOSE, CONSTITUTE CONTINUING OR PERMANENT
APPROPRIATIONS. 60 COMP.GEN. 323 (1981); 57 COMP.GEN. 311 (1978); 50
COMP.GEN. 323 (1970); 35 COMP.GEN. 615 (1956); AND 35 COMP.GEN. 436
(1956). SEE ALSO UNITED BISCUIT COMPANY OF AMERICA V. WIRTZ, 359 F.2D
206 (D.C. CIR. 1965). THE BASIS FOR THIS PRINCIPLE IS THAT, ABSENT
SPECIFIC STATUTORY AUTHORITY TO USE MONIES COLLECTED FOR THE BENEFIT OF
THE UNITED STATES, A GOVERNMENT AGENCY MUST DEPOSIT COLLECTIONS INTO THE
GENERAL FUND OF THE TREASURY AS MISCELLANEOUS RECEIPTS. 31 U.S.C. SEC.
3302(B) (FORMERLY 31 U.S.C. SEC. 484 (1976)). SEE 50 COMP.GEN. 323;
AND 36 COMP.GEN. 436. CONSEQUENTLY, LEGISLATION WHICH DIRECTS AN AGENCY
TO COLLECT MONIES AND USE THEM FOR SPECIFIC PURPOSES IS IN EFFECT A
CONTINUOUS APPROPRIATION OF FUNDS FOR THOSE PURPOSES, ELIMINATING THE
NEED FOR A NEW APPROPRIATION EACH FISCAL YEAR. UNITED BISCUIT COMPANY
OF AMERICA V. WIRTZ, 359 F.2D AT 212.
FURTHERMORE, AS WE EXPLAINED IN 60 COMP.GEN. 323, A NARROWER
DEFINITION OF THE TERM "APPROPRIATIONS" AS INCLUDING ONLY MONIES
APPROPRIATED FROM THE GENERAL FUND OF THE TREASURY WOULD BE INCONSISTENT
WITH THE BUDGET AND ACCOUNTING ACT OF 1921, 31 U.S.C. SEC. 1101(2)
(FORMERLY 31 U.S.C. SEC. 2 (1976)). THAT ACT BROADLY DEFINES THE TERM
"APPROPRIATIONS" TO INCLUDE FUNDS, AUTHORITY TO MAKE OBLIGATIONS BY
CONTRACT IN ADVANCE OF APPROPRIATIONS, AND ANY OTHER AUTHORITY MAKING
AMOUNTS AVAILABLE FOR OBLIGATION OR EXPENDITURE.
IN OUR PRIOR DECISION IN CALLAHAN, WE NOTED THE PARTICULAR RELEVANCE
OF OUR DECISION IN 35 COMP.GEN. 615. THAT LATTER DECISION INVOLVED
PROVISIONS OF SECTION 5 OF THE FEDERAL CREDIT UNION ACT, CH. 750, 48
STAT. 1216, 1217, JUNE 26, 1934, WHICH WERE SUBSTANTIALLY SIMILAR TO
THOSE NOW CONTAINED IN 12 U.S.C. SEC. 1755. UNDER THE FORMER PROVISIONS
OF SECTION 5, THE BUREAU OF FEDERAL CREDIT UNIONS, THE PREDECESSOR TO
NCUA, OPERATED EXCLUSIVELY FROM INCOME DERIVED FROM CHARTER,
EXAMINATION, AND SUPERVISION FEES WHICH WERE COLLECTED FROM FEDERAL
CREDIT UNIONS AND DEPOSITED INTO THE TREASURY FOR THE ACCOUNT OF THE
BUREAU. AFTER ANALYZING SECTION 5, WE STATED IN 35 COMP.GEN. 615 THAT
THE FEES COLLECTED BY THE BUREAU REPRESENTED MONIES RECEIVED FOR THE USE
OF THE UNITED STATES. WE HELD THAT THE STATUTORY AUTHORIZATION IN
SECTION 5 FOR CREDITING THE FEES TO A SPECIAL FUND AND THE MAKING OF
SUCH FUND AVAILABLE TO DEFRAY ADMINISTRATIVE AND SUPERVISORY EXPENSES OF
THE BUREAU CONSTITUTED A CONTINUING APPROPRIATION OF FUNDS FROM THE
TREASURY WITHOUT FURTHER ACTION BY CONGRESS. FURTHER, WE SPECIFICALLY
DECIDED THAT SUCH FUNDS REPRESENT APPROPRIATED FUNDS WHICH, IN THE
ABSENCE OF STATUTORY AUTHORIZATION TO THE CONTRARY, WOULD BE SUBJECT TO
THE VARIOUS RESTRICTIONS AND LIMITATIONS ON THE USE OF APPROPRIATED
MONIES. 35 COMP.GEN. 615, 618.
THE GENERAL COUNSEL MAINTAINS THAT OUR DECISION IN 35 COMP.GEN. 615
IS INAPPOSITE TO THE PRESENT CASE BECAUSE IT CONCERNED THE BUREAU OF
FEDERAL CREDIT UNIONS AND WAS RENDERED 14 YEARS BEFORE NCUA WAS
ESTABLISHED BY PUBLIC LAW 91-206, 84 STAT. 49, MARCH 10, 1970. HE
STATES THAT THE LEGISLATIVE HISTORY OF PUBLIC LAW 91-206 EVIDENCES
CONGRESSIONAL INTENT TO ESTABLISH NCUA AS A NONAPPROPRIATED FUND
ACTIVITY, CITING THE FOLLOWING COMMENTS CONTAINED IN H.REP. NO. 91-331,
91ST CONG., 2D SESS. 2, AND QUOTED IN OUR DECISION IN 50 COMP.GEN. 545,
AT 546 (1971):
"ONE OF THE MOST IMPORTANT ASPECTS OF THIS
LEGISLATION IS THAT THE ESTABLISHMENT OF THE
ADMINISTRATION WILL NOT COST THE TAXPAYERS A
SINGLE PENNY NOR RESULT IN ANY APPROPRIATIONS
BY CONGRESS, ***."
IN VIEW OF THE ESTABLISHED LAW AS TO WHAT CONSTITUTES APPROPRIATED
FUNDS, THE ABOVE-QUOTED STATEMENT CAN ONLY REFER TO THE FACT THAT NCUA'S
OPERATING MONIES DO NOT COME FROM THE GENERAL FUND OF THE TREASURY. AS
DISCUSSED PREVIOUSLY, FUNDS WHICH ARE DERIVED FROM SOURCES OTHER THAN
THE TREASURY MAY NEVERTHELESS BE REGARDED AS APPROPRIATED FUNDS FOR
PURPOSES OF STATUTORY RESTRICTIONS AND LIMITATIONS ON THE USE OF SUCH
FUNDS.
FURTHERMORE, IF CONGRESS HAD INTENDED THAT NCUA'S OPERATING FUND BE
TREATED AS A NONAPPROPRIATED FUND, FREE FROM STATUTORY RESTRICTIONS ON
THE USE OF APPROPRIATED MONIES, IT COULD HAVE EXPRESSLY SAID SO IN 12
U.S.C. SEC. 1755. IN THIS REGARD, WE NOTE THAT PROVISIONS OF THE FEDERAL
RESERVE ACT, AS AMENDED, 12 U.S.C. SEC. 244, AUTHORIZE THE FEDERAL
RESERVE BOARD TO LEAVE ON DEPOSIT IN FEDERAL RESERVE BANKS THE PROCEEDS
OF ASSESSMENTS LEVIED UPON THEM TO DEFRAY ITS ADMINISTRATIVE EXPENSES.
SECTION 244 EXPRESSLY PROVIDES THAT THE FUNDS DERIVED FROM SUCH
ASSESSMENTS, "SHALL NOT BE CONSTRUED TO BE GOVERNMENT FUNDS OR
APPROPRIATED MONEYS." SEE LIEUTENANT COLONEL ROBERT E. FRAZIER, USA
(RETIRED), B-212226, DECEMBER 16, 1983, 63 COMP.GEN. , FOR A DISCUSSION
OF 12 U.S.C. SEC. 244.
ALTHOUGH THE GENERAL COUNSEL SUGGESTS THAT OUR DECISION IN 35 COMP.
GEN. 615 DOES NOT APPLY TO NCUA BECAUSE ITS FINANCIAL STRUCTURE IS
DIFFERENT FROM THAT OF ITS PREDECESSOR, THE BUREAU OF FEDERAL CREDIT
UNIONS, THERE DOES NOT APPEAR TO BE ANY BASIS FOR THIS CONTENTION. IN
1953, THE BUREAU OF FEDERAL CREDIT UNIONS STOPPED RECEIVING PUBLIC FUNDS
THROUGH ANNUAL APPROPRIATIONS AND BEGAN TO OPERATE EXCLUSIVELY FROM
INCOME DERIVED FROM CHARTER, EXAMINATION, AND SUPERVISION FEES COLLECTED
FROM FEDERAL CREDIT UNIONS AND DEPOSITED INTO THE TREASURY FOR THE
ACCOUNT OF THE BUREAU. SEE 50 COMP.GEN. 545, AT 546. THUS, WHEN WE
ISSUED OUR DECISION IN 35 COMP.GEN. 615 IN 1956, THE BUREAU OF FEDERAL
CREDIT UNIONS WAS OPERATING UNDER THE SAME TYPE OF FINANCIAL ARRANGEMENT
WHICH 12 U.S.C. SEC. 1755 NOW AUTHORIZES FOR NCUA.
MOREOVER, IN B-170938, OCTOBER 30, 1972, WE SPECIFICALLY HELD THAT
THE NCUA IS AN APPROPRIATED FUND ACTIVITY AND IS THEREFORE SUBJECT TO
THE GENERAL PROHIBITION AGAINST PAYMENT OF ENTERTAINMENT EXPENSES FROM
APPROPRIATED FUNDS ABSENT SPECIFIC STATUTORY AUTHORITY. IN SO HOLDING,
WE RELIED ON OUR DECISION IN 35 COMP.GEN. 615.
THE GENERAL COUNSEL NEXT CONTENDS THAT WE RECOGNIZED NCUA AS A
NONAPPROPRIATED FUND ACTIVITY IN OUR DECISION 50 COMP.GEN. 545 (1971).
HOWEVER, AS WE EXPLAINED IN OUR DECISION IN CALLAHAN, OUR DECISION IN 50
COMP.GEN. 545 REFERRED TO 35 COMP.GEN. 615 AND DISTINGUISHED IT ONLY FOR
THE LIMITED PURPOSE OF THE MISCELLANEOUS RECEIPTS RULE REGARDING THE
DISPOSITION OF MONIES RECEIVED FOR LOST OR DAMAGED GOODS. WE INDICATED
IN 50 COMP.GEN. 545 THAT, FOR OTHER PURPOSES, WE WOULD REGARD NCUA'S
OPERATING FUND AS A CONTINUING APPROPRIATION, SUBJECT TO THE VARIOUS
RESTRICTIONS ON THE USE OF APPROPRIATED MONIES.
ON THIS BASIS, WE CONCLUDE THAT THE OPERATING MONIES MADE AVAILABLE
TO NCUA UNDER 12 U.S.C. SEC. 1755 CONSTITUTE APPROPRIATED FUNDS.
ACCORDINGLY, WE AFFIRM OUR PRIOR DETERMINATION THAT NCUA'S AUTHORITY
UNDER 12 U.S.C. SEC. 1766 TO EXPEND ITS OPERATING FUND "AS IT MAY BE
NECESSARY AND APPROPRIATE" TO CARRY OUT THE PROVISIONS OF THE FEDERAL
CREDIT UNION ACT IS CIRCUMSCRIBED BY THE PROVISIONS OF 5 U.S.C. CHAPTER
57, SUBCHAPTER II.
STATUTES GOVERNING RELOCATION EXPENSES
THE GENERAL COUNSEL NEXT QUESTIONS THE BASIS FOR OUR GENERAL RULE
PROHIBITING PAYMENT OF RELOCATION EXPENSES TO NEW APPOINTEES ABSENT
SPECIFIC STATUTORY AUTHORIZATION TO THE CONTRARY. HE STATES THAT THE
RULE IS NOT CONTAINED IN ANY OF THE RELOCATION EXPENSE STATUTES
CONTAINED IN 5 U.S.C. CHAPTER 57, SUBCHAPTER II, BUT APPEARS TO REST ON
AN UNRELIABLE PRINCIPLE OF STATUTORY CONSTRUCTION - THAT IS, THE
ENUMERATION IN 5 U.S.C. SECS. 5722 AND 5723 OF CERTAIN CATEGORIES OF NEW
APPOINTEES ENTITLED TO RELOCATION EXPENSES IMPLIES THE EXCLUSION OF
OTHERS.
WE EXPLAINED THE BASIS FOR OUR GENERAL RULE IN EARLIER DECISIONS
INVOLVING THE PAYMENT OF RELOCATION EXPENSES TO NEW APPOINTEES.
SPECIFICALLY, WE STATED THAT THE SALARIES OF FEDERAL EMPLOYEES ARE FIXED
BY STATUTE, AND, THEREFORE, IT IS IMPROPER TO PAY ADDITIONAL
COMPENSATION IN THE FORM OF RELOCATION EXPENSES FOR WHICH NO STATUTORY
OR REGULATORY AUTHORITY EXISTS. 22 COMP.GEN. 869, 871 (1943); AND 7
COMP.GEN. 114 (1927).
FURTHERMORE, THE RULE PROHIBITING PAYMENT OF RELOCATION EXPENSES TO
NEW APPOINTEES IS CONSISTENT WITH PRINCIPLES WHICH APPLY TO THE PAYMENT
OF RELOCATION EXPENSES IN GENERAL. IN THIS REGARD, IT IS CLEAR THAT A
GOVERNMENT EMPLOYEE IS NOT ENTITLED TO RELOCATION EXPENSES UNLESS THERE
IS SPECIFIC STATUTORY AUTHORITY FOR PAYMENT OF SUCH EXPENSES. SEE FINN
V. UNITED STATES, 428 F.2D 828, 832 (CT.CL. 1970). THUS, PRIOR TO THE
ENACTMENT OF PUBLIC LAW 89-516, 80 STAT. 323, JULY 21, 1966, AMENDING
THE ADMINISTRATIVE EXPENSES ACT OF 1946, A GOVERNMENT EMPLOYEE WAS NOT
ENTITLED TO SUBSISTENCE EXPENSES FOR HIS FAMILY WHILE EN ROUTE TO THE
NEW DUTY STATION, HOUSE-HUNTING EXPENSES, TEMPORARY QUARTERS SUBSISTENCE
EXPENSES, RESIDENCE SALE AND PURCHASE EXPENSES, OR MISCELLANEOUS
EXPENSES. SEE S.REP. NO. 1357, 89TH CONG., 2D SESS., REPRINTED IN 1966
U.S. CODE CONG. & AD. NEWS 2564.
ACCORDINGLY, WE FIND NO BASIS FOR OVERTURNING OUR LONG-STANDING RULE
WHICH PROHIBITS THE PAYMENT OF RELOCATION EXPENSES TO NEW APPOINTEES IN
THE ABSENCE OF SPECIFIC STATUTORY AUTHORITY TO THE CONTRARY. APPLYING
THE RULE TO THE PRESENT CASE, MR. CALLAHAN IS NOT ENTITLED TO RETAIN THE
AMOUNT REIMBURSED TO HIM FOR MOVING EXPENSES SINCE, AT THE TIME OF HIS
APPOINTMENT, THERE WAS NO STATUTORY AUTHORIZATION FOR PAYMENT OF
RELOCATION EXPENSES TO PRESIDENTIAL APPOINTEES.
THE GENERAL COUNSEL NEXT CONTENDS THAT NCUA'S DETERMINATION TO PAY
MR. CALLAHAN'S MOVING EXPENSES WAS REASONABLE IN VIEW OF THE FACT THAT 5
U.S.C. SEC. 5723 RECENTLY WAS AMENDED TO PERMIT PAYMENT OF CERTAIN
RELOCATION EXPENSES INCURRED BY PRESIDENTIAL APPOINTEES. SPECIFICALLY,
SECTION 5723, AS AMENDED BY PUBLIC LAW 98-151, 97 STAT. 964, 977,
NOVEMBER 14, 1983, AUTHORIZES REIMBURSEMENT FOR THE TRAVEL EXPENSES OF A
PRESIDENTIAL APPOINTEE, TRANSPORTATION EXPENSES OF HIS IMMEDIATE FAMILY,
AND COSTS OF SHIPPING HOUSEHOLD GOODS AND PERSONAL EFFECTS.
WE FIND THAT THE AMENDED PROVISIONS OF 5 U.S.C. SEC. 5723 HAVE NO
BEARING ON MR. CALLAHAN'S ENTITLEMENT TO THE RELOCATION EXPENSES HE
INCURRED IN 1981, SINCE THOSE PROVISIONS DID NOT BECOME EFFECTIVE UNTIL
NOVEMBER 14, 1983. SEE SECTION 118(C)(1) OF PUBLIC LAW 98-151, 97 STAT.
964, 979, AND SUPP. 10 TO THE FEDERAL TRAVEL REGULATIONS (GSA BULLETIN
FPMR A-40), 49 FED.REG. 13920 (1984). ALTHOUGH THE GENERAL COUNSEL
SUGGESTS THAT THE AMENDMENT PROVIDES AFTER-THE-FACT SUPPORT FOR NCUA'S
DETERMINATION TO PAY MR. CALLAHAN'S MOVING EXPENSES, THE REASONABLENESS
OF NCUA'S DETERMINATION IS NOT MATERIAL. THE NCUA HAD NO AUTHORITY TO
REIMBURSE MR. CALLAHAN FOR MOVING EXPENSES UNDER THE LAW THEN IN EFFECT,
AND IT IS WELL SETTLED THAT THE GOVERNMENT CANNOT GO BEYOND THE ACTUAL
AUTHORITY CONFERRED BY STATUTES AND REGULATIONS. KENNETH BECKER,
B-203502, OCTOBER 8, 1981.
FURTHERMORE, WE NOTE THAT 5 U.S.C. SEC. 5723, AS AMENDED, DOES NOT
AUTHORIZE A NEW APPOINTEE REIMBURSEMENT FOR RESIDENCE SALE AND PURCHASE
EXPENSES. OF THE $21,250.37 PAID TO MR. CALLAHAN AS REIMBURSEMENT FOR
HIS MOVING EXPENSES, $15,272.50 REPRESENTED EXPENSES ASSOCIATED WITH THE
SALE OF HIS RESIDENCE IN SPRINGFIELD, ILLINOIS, AND THE PURCHASE OF A
NEW RESIDENCE IN THE WASHINGTON, D.C., AREA.
PAYMENT BY CENTRAL LIQUIDITY FACILITY
THE GENERAL COUNSEL NEXT CONTENDS THAT MR. CALLAHAN MAY BE REGARDED
AS AN EMPLOYEE OF NCUA'S CENTRAL LIQUIDITY FACILITY (CLF) SINCE, AS
CHAIRMAN OF NCUA'S BOARD, HE IS RESPONSIBLE FOR MANAGING THE CLF. FN2
THE GENERAL COUNSEL FURTHER ARGUES THAT CLF IS A GOVERNMENT-CONTROLLED
CORPORATION, AND, UNDER 5 U.S.C. SEC. 5721, ITS EMPLOYEES ARE NOT
SUBJECT TO THE RELOCATION EXPENSE PROVISIONS OF 5 U.S.C. CHAPTER 57,
SUBCHAPTER II. ON THIS BASIS, HE ARGUES THAT CLF PROPERLY ASSUMED THE
CHARGE FOR MR. CALLAHAN'S RELOCATION EXPENSES, AND WAS FREE TO IMPLEMENT
ITS OWN POLICY WITH RESPECT TO REIMBURSEMENT OF THOSE EXPENSES.
IN OUR PRIOR DETERMINATION, WE CONCLUDED THAT CLF'S ASSUMPTION OF THE
CHARGE FOR MR. CALLAHAN'S RELOCATION EXPENSES HAD NO BEARING ON HIS
ENTITLEMENT TO SUCH EXPENSES BECAUSE MR. CALLAHAN MUST BE REGARDED AS AN
EMPLOYEE OF NCUA, NOT CLF. ALTHOUGH THE GENERAL COUNSEL DISAGREES WITH
OUR CONCLUSION, HE DOES NOT DISPUTE THAT MANAGEMENT OF THE CLF
CONSTITUTES ONLY ONE OF MR. CALLAHAN'S RESPONSIBILITIES AS CHAIRMAN OF
NCUA'S BOARD OF DIRECTORS, AND THAT MR. CALLAHAN'S SALARY IS PAID
ENTIRELY FROM NCUA'S OPERATING FUND WITHOUT REIMBURSEMENT FROM FUNDS
ALLOCATED TO CLF. ACCORDINGLY, WE FIND NO BASIS FOR REACHING A DIFFERENT
DETERMINATION ON THIS ISSUE.
ERRONEOUS ADVICE
FINALLY, THE GENERAL COUNSEL ARGUES THAT MR. CALLAHAN ACCEPTED HIS
APPOINTMENT AND INCURRED RELOCATION EXPENSES IN RELIANCE ON THE NCUA
BOARD'S ADVICE THAT HE WOULD BE REIMBURSED FOR SUCH EXPENSES. HOWEVER,
IT IS NOT MATERIAL THAT MR. CALLAHAN MAY HAVE RELIED ON ERRONEOUS ADVICE
PROVIDED BY THE NUCA BOARD, SINCE IT IS WELL SETTLED THAT THE GOVERNMENT
CANNOT BE BOUND BEYOND THE ACTUAL AUTHORITY CONFERRED UPON ITS AGENTS BY
STATUTE OR BY REGULATIONS. SEE FEDERAL CROP INSURANCE CORP. V. MERRILL,
332 U.S.. 380, 384 (1947); UTAH POWER & LIGHT CO. V. UNITED STATES,
243 U.S. 389, 409 (1917); AND KENNETH P. LINDSLEY, JR., B-194341, MAY
22, 1979.
CONCLUSION
FOR THE REASONS STATED ABOVE, WE AFFIRM OUR PRIOR DETERMINATION THAT
MR. CALLAHAN WAS NOT ENTITLED TO BE REIMBURSED FOR THE TRAVEL AND
TRANSPORTATION EXPENSES HE INCURRED IN REPORTING TO HIS FIRST DUTY
STATION. ACCORDINGLY, MR. CALLAHAN MUST REIMBURSE NCUA FOR THOSE
EXPENSES.
FN1 EFFECTIVE NOVEMBER 14, 1983, THE PROVISIONS OF 5 U.S.C. SEC.
5723 WERE AMENDED TO ADDITIONALLY PERMIT REIMBURSEMENT FOR CERTAIN
RELOCATION EXPENSES INCURRED BY PRESIDENTIAL APPOINTEES. PUBLIC LAW
98-151, 97 STAT. 964, 977, NOVEMBER 14, 1983.
FN2 THE CLF, CREATED BY PUBLIC LAW 95-630, 92 STAT. 3680, NOVEMBER
10, 1978, 12 U.S.C. SEC. 1795, WAS ESTABLISHED AS A MIXED-OWNERSHIP
GOVERNMENT CORPORATION UNDER 31 U.S.C. SEC. 856 (NOW 31 U.S.C. SEC.
9101(2)(G)), THAT WOULD "EXIST WITHIN THE NATIONAL CREDIT UNION
ADMINISTRATION AND BE MANAGED BY THE BOARD." 12 U.S.C. SEC. 1795B.
B-210656, AUG 4, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO WILL REVIEW AWARDS OF SUBCONTRACTS MADE BY
PRIME CONTRACTORS OPERATING GOVERNMENT-OWNED FACILITIES BECAUSE
SUCH SUBCONTRACT AWARDS ARE "FOR" THE GOVERNMENT.
2. PROTEST ISSUE NOT TIMELY RAISED IN PROTEST TO
AGENCY WILL NOT BE CONSIDERED IN SUBSEQUENT PROTEST TO GAO.
3. PRIME CONTRACTOR ACTED PROPERLY IN NOT GRANTING
A PREFERENCE TO A WOMEN-OWNED BUSINESS IN AWARD OF SUBCONTRACT
SINCE SOLICITATION DID NOT PROVIDE FOR SUCH A PREFERENCE.
HOLIDAY HOMES OF GEORGIA, INC.:
HOLIDAY HOMES OF GEORGIA, INC. (HOLIDAY), PROTESTS THE AWARD OF A
SUBCONTRACT TO TRIPLE "A" CUSTOM BUILDERS (TRIPLE "A") FOR MOBILE HOMES
BY THE RCA SERVICE CORPORATION (RCA), THE PRIME CONTRACTOR OPERATING,
MAINTAINING AND SUPPORTING THE DEPARTMENT OF THE NAVY'S (NAVY) ATLANTIC
UNDERSEA TEST AND EVALUATION CENTER, ANDROS ISLANDS, BAHAMAS.
WE DISMISS THE PROTEST IN PART AND DENY IT IN PART.
HOLIDAY CONTENDS THAT RCA FAILED TO COMPLY WITH A SOLICITATION
PROVISION FAVORING WOMEN-OWNED BUSINESSES, AND THAT RCA AND TRIPLE "A"
INTERFERED WITH A CONTRACTUAL RELATIONSHIP BETWEEN HOLIDAY AND RCA.
HOLIDAY ALSO ALLEGES THAT COLLUSIVE ACTION BETWEEN RCA AND TRIPLE "A"
VIOLATED ANTITRUST LAWS AND REQUESTS THAT WE REFER THE MATTER TO THE
ATTORNEY GENERAL.
AS A PRELIMINARY MATTER, WE GENERALLY DO NOT REVIEW AWARDS OF
SUBCONTRACTS BY GOVERNMENT PRIME CONTRACTORS, EXCEPT IN LIMITED
CIRCUMSTANCES. OPTIMUM SYSTEMS, INC., 54 COMP.GEN. 767 (1975), 75-1 CPD
166. HOLIDAY ARGUES THAT TWO OF THE CIRCUMSTANCES IN WHICH WE WILL
REVIEW SUBCONTRACTS ARE PRESENT HERE: THE PRIME CONTRACTOR IS A
PURCHASING AGENT FOR THE GOVERNMENT, AND ELEMENTS OF BAD FAITH OR FRAUD
ARE INVOLVED. THE NAVY ARGUES THAT NEITHER OF THOSE CIRCUMSTANCES IS
PRESENT HERE, AND THAT WE SHOULD DISMISS THE ENTIRE PROTEST.
WE FIND THAT OUR REVIEW HERE IS WARRANTED UNDER ANOTHER OF THAT
DECISION'S CIRCUMSTANCES - THE PRIME CONTRACTOR IS MANAGING OR OPERATING
A GOVERNMENT-OWNED FACILITY AND, THUS, THE SUBCONTRACT AWARD IS "FOR"
THE GOVERNMENT. CMI CORPORATION, B-205829, SEPTEMBER 8, 1982, 82-2 CPD
204; KAHLE ENGINEERING COMPANY, B-198563, OCTOBER 8, 1980, 80-2 CPD
256.
THE EXACT NATURE OF HOLIDAY'S ALLEGATION THAT RCA AND TRIPLE "A"
INTERFERED WITH A CONTRACTUAL RELATIONSHIP BETWEEN RCA AND HOLIDAY IS
UNCLEAR FROM THE RECORD; HOWEVER, THIS ALLEGATION IS DISMISSED BECAUSE
IT WAS NOT TIMELY FILED. HOLIDAY WAS NOTIFIED OF THE AWARD TO TRIPLE
"A" ON DECEMBER 3, 1982, AND PROTESTED TO RCA ON DECEMBER 6. THAT
PROTEST DID NOT RAISE THIS ISSUE. ON DECEMBER 21, HOLIDAY FILED A
PROTEST WITH THE NAVY WHICH RAISED THE INTERFERENCE WITH CONTRACTUAL
RELATIONS ISSUE FOR THE FIRST TIME. THE NAVY REPORTS THAT NO NEW
INFORMATION WAS PROVIDED TO HOLIDAY BETWEEN DECEMBER 3 AND DECEMBER 21
THAT COULD HAVE BEEN THE BASIS FOR RAISING THE ISSUE. HOLIDAY HAS NOT
REBUTTED THIS CONTENTION, AND A LETTER OF JANUARY 12, 1983, FROM HOLIDAY
TO THE NAVY INDICATES THAT THE ISSUE IS BASED ON HOLIDAY'S PREAWARD
INVOLVEMENT IN THIS PROCUREMENT AND AWARD TO TRIPLE "A."
WHEN A PROTEST IS FILED INITIALLY WITH THE CONTRACTING AGENCY, WE
WILL CONSIDERER A SUBSEQUENT PROTEST ONLY IF THE INITIAL PROTEST WAS
TIMELY FILED. 4 C.F.R. SEC. 21.2(A) (1983). TO BE TIMELY FILED, A
PROTEST MUST BE FILED WITHIN 10 WORKING DAYS OF THE TIME THAT THE
PROTESTER KNOWS OF THE BASIS FOR THE PROTEST. 4 C.F.R. SEC. 21.2(B)(2)
(1983). HERE, THE CONTRACTUAL INTERFERENCE ISSUE WAS RAISED INITIALLY
IN THE DECEMBER 21 PROTEST TO THE NAVY, MORE THAN 10 WORKING DAYS AFTER
THE BASIS FOR IT WAS KNOWN, SO IT WAS NOT TIMELY FILED WITH THE AGENCY.
CONSEQUENTLY, WE WILL NOT CONSIDER IT.
HOLIDAY ARGUES THAT EVEN THOUGH IT WAS NOT THE LOW OFFEROR, IT IS A
WOMEN-OWNED BUSINESS AND SHOULD BE GIVEN A PREFERENCE FOR AWARD OF THE
SUBCONTRACT BASED ON A PROVISION IN THE SOLICITATION. THE SOLICITATION
PROVISION CONCERNING WOMEN-OWNED BUSINESSES DOES NO MORE THAN STATE THAT
IT IS THE POLICY OF THE UNITED STATES THAT WOMEN-OWNED BUSINESSES SHALL
HAVE THE MAXIMUM PRACTICABLE OPPORTUNITY TO PARTICIPATE IN FEDERAL
CONTRACTS AND THAT RCA AGREES TO USE ITS BEST EFFORTS TO CARRY OUT THE
POLICY CONSISTENT WITH THE EFFICIENT PERFORMANCE OF ITS CONTRACT. THE
PROVISION PROVIDES NO BASIS TO GIVE PREFERENCE TO A WOMEN-OWNED FIRM IN
DETERMINING WHICH FIRM IS TO BE AWARDED THE SUBCONTRACT. THEREFORE, IT
WOULD HAVE BEEN IMPROPER FOR RCA TO GRANT SUCH A PREFERENCE TO HOLIDAY.
MEDICAL GAS AND RESPIRATORY SERVICES, INC., B-207360, JUNE 2, 1982, 82-1
CPD 529.
FINALLY, HOLIDAY ALLEGES THAT COLLUSION BETWEEN RCA AND TRIPLE "A"
VIOLATED ANTITRUST LAWS. HOLIDAY REALIZES THAT WE DO NOT CONSIDER SUCH
ALLEGATIONS, BUT REQUESTS THAT WE NOTIFY THE ATTORNEY GENERAL OF
POSSIBLE ANTITRUST VIOLATIONS PURSUANT TO 41 C.F.R. SUBPART 1-1.9
(1982). HOWEVER, THAT SUBPART PROVIDES THAT THE HEAD OF A CIVILIAN
FEDERAL CONTRACTING AGENCY REFER BIDS OR PROPOSALS IN DIRECT FEDERAL
PROCUREMENTS TO THE ATTORNEY GENERAL WHEN IN HIS OPINION THEY EVIDENCE
ANTITRUST VIOLATIONS. WE NOTE THAT THE DEFENSE ACQUISITION REGULATION
(DAR) CONTAINS A CORRESPONDING PROVISION FOR MILITARY AGENCIES. DAR
SEC. 1-111 (1976 ED.). THEREFORE, HOLIDAY MAY FORWARD ANY EVIDENCE OF
ANTITRUST VIOLATIONS TO THE NAVY FOR ITS CONSIDERATION AND POSSIBLE
REFERRAL, OR IT MAY FORWARD THE EVIDENCE DIRECTLY TO THE ATTORNEY
GENERAL. KDH CORPORATION AND RICHARD W. BATES, JOINT VENTURE, B-209207,
DECEMBER 14, 1982, 82-2 CPD 532; INFLATED PRODUCTS COMPANY, INC.,
B-190877, MAY 11, 1978, 78-1 CPD 362.
PROTEST DISMISSED IN PART AND DENIED IN PART.
B-210655 L/M, APR 14, 1983
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
RICHARD L. OTTINGER, HOUSE OF REPRESENTATIVES:
THIS RESPONDS TO YOUR JANUARY 21, 1983, REQUEST FOR OUR OPINION ON
THE LEGALITY OF THE DEPARTMENT OF ENERGY'S (DOE) GRANT TO THE SCIENTISTS
AND ENGINEERS FOR SECURE ENERGY (SE-2) TO CONDUCT COLLEGE CAMPUS FORUMS
ON NUCLEAR ENERGY.
SPECIFICALLY, YOU ASK WHETHER THE GRANT WAS WITHIN THE SCOPE OF THE
AGENCY'S AUTHORITY AND WHETHER THE AGENCY'S GRANT REGULATIONS WERE
COMPLIED WITH. YOU ALSO INQUIRE ABOUT THE APPLICABILITY OF THE STATUTE
ON ORGANIZATIONAL CONFLICTS OF INTEREST, 15 U.S.C. SEC. 789, TO GRANTS;
AND WHETHER DOE HAS LEGAL RIGHTS IF SE-2 FAILS TO PERFORM 24 FORUMS.
WE CONCLUDE, BASED ON THE AUTHORITY CITED IN DOE'S GRANT DOCUMENT AND
DOE'S DESCRIPTION OF ITS PURPOSE IN MAKING AN AWARD TO SE-2, THAT DOE
DID NOT HAVE AUTHORITY TO USE A GRANT INSTRUMENT IN THE DESCRIBED
CIRCUMSTANCES; THAT 15 U.S.C. 789, BY ITS TERMS, DOES NOT APPLY TO
GRANT AWARDS; AND THAT THE AWARD TO SE-2 REQUIRES ONLY PROPORTIONATE
FUNDING BY DOE OF CAMPUS FORUMS ACTUALLY CONDUCTED BY SE-2. BECAUSE WE
DID NOT HAVE SUFFICIENT TIME TO OBTAIN THE OFFICIAL VIEWS OF DOE ON THIS
QUESTION, OUR CONCLUSION THAT DOE DID NOT HAVE AUTHORITY TO USE A GRANT
INSTRUMENT IN THIS CASE IS SUBJECT TO CHANGE IF DOE PRESENTS OTHER VALID
ARGUMENTS OR AUTHORITIES WHICH WE HAVE NOT CONSIDERED.
BACKGROUND
IN SEPTEMBER 1981, DOE WAS CONSIDERING STAFF PROPOSALS TO INSTITUTE A
PUBLIC RELATIONS CAMPAIGN TO PROMOTE NUCLEAR POWER. IN DECEMBER 1981,
YOUR SUBCOMMITTEE HELD HEARINGS ON THE MATTER AND LEARNED THAT THE
PROPOSALS ANTICIPATED A CONTRACTUAL ARRANGEMENT WITH A GROUP OF
PROFESSIONALS KNOWN AS SCIENTISTS AND ENGINEERS FOR SECURE ENERGY
(SE-2), A NATIONAL NON-PROFIT EDUCATIONAL ORGANIZATION THAT IS
PRO-NUCLEAR ENERGY.
A PROCUREMENT REQUEST WAS PREPARED AND SIGNED BY APPROPRIATE DOE
OFFICIALS. HOWEVER, IT WAS WITHDRAWN AND A GRANT WAS AWARDED INSTEAD
THROUGH THE OFFICE OF NUCLEAR ENERGY TO SE-2, ON DECEMBER 10, 1982, IN
THE AMOUNT OF $100,000. ITS STATED PURPOSE WAS TO ASSIST SE-2 IN
CONDUCTING CAMPUS FORUMS ON ENERGY-RELATED ISSUES FOR THE PERIOD
DECEMBER 1982 THROUGH THE END OF FISCAL YEAR 1983. TO DATE, SE-2 HAS
CONDUCTED ONLY ONE FORUM, ON MARCH 22, 1983. IT PLANS TO CONDUCT EIGHT
OTHERS, ALTHOUGH ITS PLAN AT THE TIME OF THE GRANT AWARD WAS TO CONDUCT
24.
ANALYSIS
WE ARE UNABLE TO FIND CLEAR STATUTORY AUTHORIZATION FOR THE GRANT
WHICH DOE AWARDED SE-2. THE STATUTORY PROVISIONS THAT DOE CITES ON THE
FACE OF THE GRANT AWARD FOR ITS AUTHORITY TO ENTER INTO THE GRANT ARE:
"PUB.L. NO. 95-91, 42 U.S.C. 7101; PUB.L. NO. 93-438, 88 STAT. 1240."
THE FIRST PROVISION IS THE FIRST SECTION OF THE DEPARTMENT OF ENERGY
ORGANIZATION ACT AND APPARENTLY IS INTENDED TO REFER TO THAT ENTIRE ACT.
THIS ACT ELSEWHERE PROVIDES:
"*** ONE OF THE ACT'S PURPOSES IS DISSEMINATING
INFORMATION RESULTING FROM SUCH PROGRAMS, INCLUDING
DISSEMINATING INFORMATION ON THE COMMERCIAL FEASIBILITY
AND USE OF ENERGY FROM FOSSIL, NUCLEAR, SOLAR,
GEOTHERMAL, AND OTHER ENERGY TECHNOLOGIES ***." 42
U.S.C. SEC. 7112(5)(D) (SUPP. III, 1979).
THE SECOND PROVISION CITED IS FROM THE ENERGY REORGANIZATION ACT OF
1974, 42 U.S.C. SEC. 5817 (SUPP. III, 1979). SUBSECTION (E) OF THIS
SECTION (THIS SUBSECTION IS FOUND AT 88 STAT. 1241 NOT 1240 AS CITED)
PROVIDES AS FOLLOWS:
"(E) SUBJECT TO THE PROVISIONS OF CHAPTER 12 OF THE
ATOMIC ENERGY ACT OF 1954, AS AMENDED (42 U.S.C. 2161-2166),
AND OTHER APPLICABLE LAW, THE ADMINISTRATOR OF THE
ENERGY RESEARCH AND DEVELOPMENT ADMINISTRATION SHALL
DISSEMINATE SCIENTIFIC, TECHNICAL, AND PRACTICAL
INFORMATION ACQUIRED PURSUANT TO THIS TITLE THROUGH
INFORMATION PROGRAMS AND OTHER APPROPRIATE MEANS,
AND SHALL ENCOURAGE THE DISSEMINATION OF SCIENTIFIC,
TECHNICAL, AND PRACTICAL INFORMATION RELATING TO ENERGY
SO AS TO ENLARGE THE FUND OF SUCH INFORMATION
AND TO PROVIDE THAT FREE INTERCHANGE OF IDEAS AND
CRITICISM WHICH IS ESSENTIAL TO SCIENTIFIC AND
INDUSTRIAL PROGRESS AND PUBLIC UNDERSTANDING."
THE AUTHORITIES OF THE QUOTED SECTION WERE TRANSFERRED TO THE
SECRETARY OF ENERGY BY 42 U.S.C. SEC. 7151 (SUPP. III, 1979). THE GRANT
FILE CONFIRMS THAT THE AWARD WAS MADE UNDER THE DISSEMINATION AUTHORITY
OF THE ENERGY REORGANIZATION ACT OF 1974 AND THE PURPOSES STATEMENT IN
THE ENERGY ORGANIZATION ACT, SUPRA.
ON ITS FACE, THE QUOTED PROVISION OF THE ENERGY REORGANIZATION ACT OF
1974 PROVIDES VERY BROAD AUTHORITY FOR THE ADMINISTRATOR (AND THE
SECRETARY THROUGH THE TRANSFER PROVISION OF 42 U.S.C. SEC. 7151) TO
DISSEMINATE INFORMATION OF A SCIENTIFIC, TECHNICAL AND PRACTICAL NATURE.
THE PROVISION STRESSES THAT THE ADMINISTRATOR ENCOURAGE THE
DISSEMINATION OF SUCH INFORMATION SO AS TO PROVIDE FOR "THAT FREE
INTERCHANGE OF IDEAS AND CRITICISM WHICH IS ESSENTIAL TO SCIENTIFIC AND
INDUSTRIAL PROGRESS AND PUBLIC UNDERSTANDING." READ IN CONJUNCTION WITH
THE FEDERAL GRANT AND COOPERATIVE AGREEMENT ACT OF 1977, 41 U.S.C. SEC.
504, UNDER WHICH A GRANT INSTRUMENT MAY BE USED IF THE AGENCY'S
AUTHORITY FITS THE ACT'S DEFINITION OF AN ASSISTANCE RELATIONSHIP,
DESPITE THE FACT THAT THE SPECIFIC WORD, "GRANT", IS NOT ACTUALLY USED
IN ITS LEGISLATION, AN ARGUMENT COULD BE MADE THAT SEC. 5817(E) CONFERS
SUFFICIENT AUTHORITY UPON THE SECRETARY TO AWARD A GRANT FOR THE
CONDUCTING OF PUBLIC INFORMATION FORUMS.
IT SHOULD BE NOTED THAT THE FEDERAL GRANT AND COOPERATIVE AGREEMENT
ACT OF 1977, 41 U.S.C. SEC. 504, STATES CONDITIONS UNDER WHICH AN AGENCY
IS REQUIRED TO USE A GRANT RATHER THAN A CONTRACT OR COOPERATIVE
AGREEMENT. A GRANT IS PROPER WHEN THE PRINCIPAL PURPOSE OF THE
RELATIONSHIP BETWEEN THE GOVERNMENT AND THE RECIPIENT IS THE "TRANSFER
OF MONEY, PROPERTY, SERVICES, OR ANYTHING OF VALUE ***" TO ACCOMPLISH "A
PUBLIC PURPOSE OF SUPPORT OR STIMULATION AUTHORIZED BY FEDERAL STATUTE
***," RATHER THAN TO ACQUIRE PROPERTY OR SERVICES FOR THE DIRECT BENEFIT
OR USE OF THE GOVERNMENT. FURTHER, A GRANT RATHER THAN A COOPERATIVE
AGREEMENT IS REQUIRED WHERE THERE IS NO SUBSTANTIAL INVOLVEMENT
ANTICIPATED BETWEEN THE AGENCY AND THE RECIPIENT. HOWEVER, THE FEDERAL
GRANT AND COOPERATIVE AGREEMENT ACT, SUPRA, DOES NOT BY ITSELF EXPAND AN
AGENCY'S AUTHORITY TO MAKE GRANTS. IN ORDER TO PROVIDE ASSISTANCE
THROUGH A GRANT THERE MUST BE SOME AFFIRMATIVE LEGISLATIVE
AUTHORIZATION. WHILE THE ACT PROVIDES A BASIS FOR EXAMINING WHETHER AN
ARRANGEMENT SHOULD BE A CONTRACT, GRANT, OR COOPERATIVE AGREEMENT,
DETERMINATIONS OF WHETHER AN AGENCY HAS AUTHORITY TO ENTER INTO ONE OF
THESE TYPES OF RELATIONSHIPS MUST BE FOUND IN THE AGENCY'S AUTHORIZING
LEGISLATION.
THE NATURE OF THE AUTHORITY PROVIDED IS NOT CLEAR ON ITS FACE. THE
AUTHORITIES CITED STATE THAT THE ADMINISTRATOR SHALL DISSEMINATE
SCIENTIFIC, TECHNICAL, AND PRACTICAL INFORMATION "THROUGH INFORMATION
PROGRAMS AND OTHER APPROPRIATE MEANS." IT DOES NOT DEFINE WHICH OTHER
MEANS ARE APPROPRIATE FOR USE IN CONDUCTING THE DISSEMINATION. THE
LANGUAGE CONCERNING THE ENCOURAGEMENT OF INFORMATION DISSEMINATION IS
SIMILARLY UNCLEAR AS TO THE MEANS BY WHICH DISSEMINATION SHOULD BE
ENCOURAGED. WHILE EVERY AGENCY HAS INHERENT POWER TO ENTER INTO
CONTRACTS TO ACHIEVE ITS PURPOSES, WE HESITATE TO IMPLY THE POWER TO
DONATE GOVERNMENT FUNDS TO ASSIST NON-GOVERNMENT ENTITIES TO ACCOMPLISH
THEIR OWN PURPOSES, HOWEVER MERITORIOUS, WITHOUT CLEAR EVIDENCE THAT THE
CONGRESS INTENDED TO AUTHORIZE SUCH AN ASSISTANCE RELATIONSHIP.
ALTHOUGH NOT CITED BY DOE, IN ORDER TO EXPLORE ALL POSSIBLE SOURCES
OF GRANT AUTHORITY, WE NEXT EXAMINED THE GENERAL ADMINISTRATIVE
PROVISIONS OF THE ENERGY ORGANIZATION ACT, 42 U.S.C. SEC. 7152 ET. SEQ.
SECTION 7256(A) OF TITLE 42, THE ENERGY ORGANIZATION ACT, (WHICH APPLIES
TO THE DISSEMINATION OF KNOWLEDGE AUTHORITY, DISCUSSED SUPRA, THROUGH
THE TRANSFER AUTHORITY FOUND IN SEC. 7151) GENERALLY SETS FORTH THE
SECRETARY'S POWERS AND AUTHORITIES IN CARRYING OUT HIS DUTIES AS
FOLLOWS:
"(A) THE SECRETARY IS AUTHORIZED TO ENTER INTO AND
PERFORM SUCH CONTRACTS, LEASES, COOPERATIVE AGREEMENTS, OR
OTHER SIMILAR TRANSACTIONS WITH PUBLIC AGENCIES AND
PRIVATE ORGANIZATIONS AND PERSONS, AND TO MAKE SUCH
PAYMENTS (IN LUMP SUM OR INSTALLMENTS, AND BY WAY OF
ADVANCE OR REIMBURSEMENT) AS HE MAY DEEM TO BE NECESSARY
OR APPROPRIATE TO CARRY OUT FUNCTIONS NOW OR HEREAFTER
VESTED IN THE SECRETARY."
ONE COULD ARGUE, WITH DUBIOUS VALIDITY, THAT A GRANT IS A TRANSACTION
"SIMILAR" TO A CONTRACT, LEASE, OR COOPERATIVE AGREEMENT. WE NEED NOT
RESOLVE THAT CONTENTION NOW BECAUSE THE LEGISLATIVE HISTORY SHOWS THAT
THE TERM "GRANTS," WHICH WAS INITIALLY INCLUDED IN THE SENATE VERSION OF
THE SECTION WHICH EVENTUALLY BECAME SECTION 7256, WAS DELETED IN FINAL
ACTION ON THE LEGISLATION. SEE SENATE REPORT NO. 95-164, 95TH CONG.,
1ST SESS. (1977). SEE ALSO HOUSE REPORT NO. 95-346, PART 1, 95TH
CONG., 1ST SESS. (1977). THE HOUSE BILL DID NOT INCLUDE GRANTS AMONG
THE SECRETARY'S AUTHORITIES. THE CONFERENCE REPORT NO. 95-539, 95TH
CONG., 1ST SESS. (1977), MAKES IT CLEAR THAT THE DELETION OF GRANT
AUTHORITY WAS INTENTIONAL. IT STATES:
"SECTION 646 - CONTRACTS
"THE SENATE BILL AUTHORIZES THE SECRETARY OF ENERGY
TO ENTER INTO AND PERFORM CONTRACTS, LEASES, GRANTS,
COOPERATIVE AGREEMENTS, OR OTHER SIMILAR TRANSACTIONS
WITH PUBLIC AGENCIES, PRIVATE ORGANIZATIONS AND
PERSONS. SUCH AUTHORITY IS EFFECTIVE ONLY TO THE EXTENT
PROVIDED IN APPROPRIATIONS ACTS.
"THE HOUSE BILL AUTHORIZES THE SECRETARY OF ENERGY TO
ENTER INTO AND PERFORM CONTRACTS, LEASES, COOPERATIVE
AGREEMENTS, OR OTHER SIMILAR TRANSACTIONS WITH PUBLIC
AGENCIES, PRIVATE ORGANIZATIONS AND PERSONS, BUT DOES
NOT AUTHORIZE THE SECRETARY TO ENTER INTO GRANTS. NO
AUTHORITY TO ENTER INTO CONTRACTS OR TO MAKE PAYMENTS
UNDER THIS TITLE SHALL BE EFFECTIVE EXCEPT TO THE EXTENT
OR IN SUCH AMOUNTS AS ARE PROVIDED FOR IN ADVANCE IN
APPROPRIATION ACTS.
"THE CONFERENCE SUBSTITUTE ADOPTS THE HOUSE
PROVISIONS WITH AN UNDERSTANDING AMONG THE CONFEREES THAT
THE RESTRICTING OF CONTRACTING AND RELATED AUTHORITY TO
THOSE FUNDED IN ADVANCE BY APPROPRIATIONS IS NOT INTENDED
TO APPLY TO EXISTING PROGRAMS, NOR TO EXISTING CONTRACT
AUTHORITIES UNDER PRIOR LAW. LAWS GRANTING SPECIFIC
CONTRACT AUTHORITY ALSO WILL CONTINUE TO APPLY."
WE THEREFORE BELIEVE THAT THE LEGISLATIVE HISTORY OF 42 U.S.C. SEC.
7256 DEMONSTRATES THAT A GRANT AWARD IS NOT ONE OF THE MEANS INTENDED BY
THE CONGRESS TO BE USED IN DISSEMINATING ENERGY-RELATED INFORMATION.
THIS ALSO APPLIES TO THE PURPOSE LANGUAGE OF THE DOE ORGANIZATION
ACT, 42 U.S.C. SEC. 7112(5)(D), WHICH DOE CITED AS ADDITIONAL AUTHORITY
FOR MAKING THIS GRANT. ALTHOUGH WE DO NOT BELIEVE THE LANGUAGE IN THAT
SECTION COULD INDEPENDENTLY BE CONSTRUED AS GRANT AUTHORITY IN ANY
EVENT, IT IS CLEARLY LIMITED BY THE AUTHORITY PROVISION OF SECTION 7256,
DISCUSSED ABOVE, WHICH DOES NOT INCLUDE THE AUTHORITY TO AWARD GRANTS.
WE MUST ALSO POINT OUT THAT WHEN THE CONGRESS WISHED TO ENABLE THE
SECRETARY TO GIVE GRANT ASSISTANCE AS A MEANS OF CARRYING OUT ONE OF HIS
FUNCTIONS, IT PROVIDED THIS AUTHORITY IN VERY SPECIFIC TERMS. SEE, FOR
EXAMPLE, THE SOLAR HEATING AND COOLING DEMONSTRATION ACT OF 1974, 42
U.S.C. SECS. 5503(C), 5504(D); THE SOLAR PHOTOVOLTAIC ENERGY RESEARCH,
DEVELOPMENT, AND DEMONSTRATION ACT OF 1978, 42 U.S.C. SEC. 5585.
IN ADDITION TO OUR CONCERNS OVER WHETHER THE AUTHORITY RELIED ON BY
DOE TO SUPPORT A GRANT IN THESE CIRCUMSTANCES IS ADEQUATE, IT IS ALSO
NOT CLEAR ON THE BASIS OF THE INFORMATION WITH WHICH WE HAVE BEEN
PROVIDED THAT THE AGREEMENT WITH SE-2 WOULD QUALIFY AS A "GRANT" UNDER
THE FEDERAL GRANT AND COOPERATIVE AGREEMENT ACT, SUPRA, EVEN IF DOE'S
AUTHORITY TO AWARD A GRANT WERE UNDISPUTED. AS DISCUSSED EARLIER, THAT
ACT PROVIDES THAT A GRANT RELATIONSHIP IS PROPER WHEN THE GOVERNMENT IS
PROVIDING ASSISTANCE TO A NON-GOVERNMENTAL ENTITY IN ORDER TO SUPPORT
ITS OWN EFFORTS IN ACCOMPLISHING A PUBLIC PURPOSE. WHEN THE GOVERNMENT
IS ACQUIRING GOODS OR SERVICES IN ORDER TO CARRY OUT A GOVERNMENTAL
FUNCTION, A PROCUREMENT RELATIONSHIP IS PROPER.
IN THE CASE AT HAND, DOE INITIALLY PROPOSED A PROCUREMENT
RELATIONSHIP WITH SE-2. THE DISCUSSIONS AT THE 1981 HEARINGS BEFORE
YOUR SUBCOMMITTEE WERE IN THE CONTEXT OF A PROPOSED, ALTHOUGH AT THAT
TIME UNAPPROVED, PROCUREMENT. A PROCUREMENT REQUEST AUTHORIZATION FORM
FORWARDED WITH DOE'S LETTER TO YOU, DATED DECEMBER 2, 1982, SPECIFIED
THAT A PROCUREMENT RATHER THAN AN ASSISTANCE RELATIONSHIP WAS PROPOSED.
IN ADDITION, DOE'S LETTER STRONGLY ARGUES DOE'S "LEGISLATIVE MANDATE"
TO PROVIDE INFORMATION TO THE PUBLIC IN TERMS THAT DESCRIBE THE
ACCOMPLISHMENT OF A GOVERNMENTAL FUNCTION RATHER THAN THE PROVISION OF
ASSISTANCE TO AN OUTSIDE GROUP TO CARRY OUT ITS OWN PROGRAM. THE
RELEVANT PASSAGE FROM THE FEBRUARY 7 LETTER IS SET OUT BELOW:
"ONCE AGAIN, I WOULD LIKE TO BRING YOUR ATTENTION TO
THE LEGISLATIVE MANDATE CONTAINED IN BOTH THE ENERGY
REORGANIZATION ACT OF 1974 AND THE DOE ORGANIZATION
ACT OF 1977, TO PROVIDE THE PUBLIC WITH INFORMATION
THE FEDERAL ROLE IN NUCLEAR ENERGY. OUR PRIMARY GOAL IS
TO PROVIDE THE PUBLIC MORE AND BETTER QUALITY INFORMATION
ABOUT VITAL FEDERAL PROGRAMS DEALING WITH NUCLEAR SAFETY,
WASTE MANAGEMENT, AND LONG-RANGE, HIGH-RISK R&D. OUR
OBJECTIVES ARE: (1) TO INCREASE PUBLIC UNDERSTANDING
OF OVERALL POLICY, (2) TO CORRECT PUBLIC MISCONCEPTIONS
ABOUT CERTAIN ASPECTS OF NUCLEAR ENERGY, AND (3) TO
ENABLE THE PUBLIC TO MAKE SOUND, FREE-MARKET DECISIONS
ABOUT NUCLEAR ENERGY. THIS KIND OF INFORMATION MUST BE
PROVIDED BY THE GOVERNMENT BECAUSE INDUSTRY IS NOT THE
APPROPRIATE SPOKESMAN OF FEDERAL ENERGY POLICY."
IT THUS APPEARS THAT A PROCUREMENT, RATHER THAN A GRANT, WAS THE
APPROPRIATE VEHICLE FOR THE AGREEMENT WITH SE-2. USE THE GRANT
MECHANISM, HOWEVER, AVOIDED THE NEED FOR APPLICATION OF ORGANIZATIONAL
CONFLICT OF INTEREST RULES, AS DISCUSSED BELOW, AS WELL AS THE
COMPETITION REQUIREMENTS OF THE PROCUREMENT STATUTES.
ON THE QUESTION OF THE APPLICABILITY OF ORGANIZATIONAL CONFLICT OF
INTEREST PROHIBITIONS, DOE STATED IN A LETTER TO YOU DATED FEBRUARY 7,
1983, THAT "DOE ORGANIZATIONAL CONFLICT OF INTEREST FORMS, HQF-2302, ARE
NOT REQUIRED FOR GRANTS, BUT ARE FILED FOR ALL SOLE-SOURCE AND SUPPORT
CONTRACTS." 15 U.S.C. SEC. 789, ORGANIZATIONAL CONFLICTS, WHICH DOE'S
FORMS APPARENTLY IMPLEMENT, CONTAINS LANGUAGE SIMILAR TO THE DOE
ORGANIZATION ACT LANGUAGE, CITED IN OUR DISCUSSION OF DOE'S LACK OF
GRANT AUTHORITY. SECTION 789(A) REQUIRES ORGANIZATIONAL CONFLICT
INFORMATION OF "ANY PERSON PROPOSING TO ENTER INTO A CONTRACT,
AGREEMENT, OR OTHER ARRANGEMENT ***" WITH DOE BUT DOES NOT SPECIFY
GRANTS. IN ADDITION, IT IS CLEAR FROM READING SECTION 789 AS A WHOLE
THAT IT REFERS TO PROCUREMENT RATHER THAN ASSISTANCE RELATIONSHIPS.
ACCORDINGLY, WE AGREE WITH DOE THAT THE ORGANIZATIONAL CONFLICT
PROVISIONS WOULD NOT NORMALLY APPLY TO GRANT AWARDS.
WITH RESPECT TO THE NUMBER OF FORUMS WHICH THE AGREEMENT REQUIRES
SE-2 TO HOLD, WE NOTE THAT THE FACE PAGE OF THE AGREEMENT COPY
INFORMALLY PROVIDED BY YOUR STAFF SHOWS A TOTAL APPROVED BUDGET OF
$236,900.00, OF WHICH $136,900.00 IS TO BE PROVIDED BY SE-2 AND $100,000
BY DOE. THIS AMOUNT IS ELSEWHERE DESCRIBED AS SUFFICIENT TO SUPPORT 24
FORUMS. THE PER FORUM COST IS DESCRIBED AS $8,583.34 AND PAYMENT IS TO
BE BY MONTHLY REIMBURSEMENT. IT THUS APPEARS THAT THERE IS NO
REQUIREMENT TO EXPEND THE ENTIRE BUDGET BY CONDUCTING 24 FORUMS, AND
THAT REIMBURSEMENT SHOULD BE ON A PER FORUM BASIS IN AN AMOUNT WHICH
BEARS A PROPORTIONAL RELATIONSHIP TO THE BUDGET AMOUNT PROPOSED BY SE-2
FOR 24 FORUMS.
B-210654, DEC 23, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. SOLICITATION FOR CUSTODIAL SERVICES WAS PROPERLY
CANCELED WHERE A PROVISION OF THE JOINT CONTINUING RESOLUTION OF
DECEMBER 21, 1982 PROHIBITED THE GENERAL SERVICES ADMINISTRATION
(GSA) FROM CONTRACTING OUT FOR THE SERVICES CONTEMPLATED BY A
PORTION OF THE SOLICITATION AND THE TERM OF THE EXISTING CONTRACT
FOR THE REMAINDER OF THE WORK ENCOMPASSED 6 MONTHS OF THE
PERFORMANCE PERIOD COVERED BY THE SOLICITATION.
2. A PROTESTER IS NOT ENTITLED TO BID PREPARATION
COSTS WHERE AGENCY MAKES A REASONABLE DETERMINATION TO CANCEL A
SOLICITATION AFTER BID OPENING, EVEN IF PART OF THE INFORMATION
FORMING THE BASIS OF THE DECISION TO CANCEL WAS AVAILABLE TO THE
CONTRACTING OFFICER PRIOR TO BID OPENING, WHERE THERE IS NO
INDICATION THAT AGENCY ACTED IN BAD FAITH.
COAST JANITORIAL SERVICE, INC.:
COAST JANITORIAL SERVICE, INC. PROTESTS THE CANCELLATION OF
INVITATION FOR BIDS (IFB) NO. GS-07B-21185/7S ISSUED BY REGION 7 OF THE
GENERAL SERVICES ADMINISTRATION (GSA). COAST CONTENDS THAT THERE WAS NO
RATIONAL BASIS FOR THE CANCELLATION. IT REQUESTS THAT WE AWARD IT BID
PREPARATION COSTS AND "COSTS INCURRED SUBSEQUENT TO THE SCHEDULE
PREPARATION." WE DENY THE PROTEST AND THE CLAIM.
THE SOLICITATION WAS ISSUED ON JUNE 7, 1982, AND SOUGHT BIDS ON A
1-YEAR CONTRACT FOR THE PERIOD OF SEPTEMBER 1, 1982 THROUGH AUGUST 31,
1983, WITH 2 OPTION YEARS, TO PROVIDE CUSTODIAL SERVICES IN FOUR FEDERAL
BUILDINGS IN HOUSTON, TEXAS. THE SOLICITATION DIRECTED BIDDERS TO
SUBMIT BIDS ON PHASE I (FOR SERVICES THAT WERE CURRENTLY BEING PERFORMED
BY AN INCUMBENT CONTRACTOR) AND PHASE II (FOR SERVICES CURRENTLY BEING
PERFORMED BY GSA EMPLOYEES). FN1 AWARD WAS TO BE BASED ON THE TOTAL
PRICE FOR THE BASE AND OPTION YEARS. THE SOLICITATION ALSO NOTED THAT
BIDS ON PHASE II WERE BEING SOLICITED AS PART OF AN OFFICE OF MANAGEMENT
AND BUDGET CIRCULAR A-76 (A-76) COST COMPARISON.
MEANWHILE, SINCE THE THEN CURRENT CONTRACT FOR THE CUSTODIAL SERVICES
WAS ABOUT TO EXPIRE, GSA ON JUNE 17 EXERCISED THE OPTION IN THE
INCUMBENT'S CONTRACT EXTENDING THAT FIRM'S PERIOD OF PERFORMANCE THROUGH
JUNE 30, 1983. THESE WERE THE SERVICES ENCOMPASSED BY PHASE I OF THE
SOLICITATION. AFTER SEVERAL AMENDMENTS TO THE SOLICITATION, BID OPENING
WAS SCHEDULED FOR SEPTEMBER 7 AND THE PERFORMANCE PERIOD CHANGED TO
JANUARY 1 THROUGH DECEMBER 31, 1983.
AT THE SEPTEMBER 7 BID OPENING, COAST WAS THE APPARENT LOW RESPONSIVE
BIDDER. GSA FOUND COAST TO BE NONRESPONSIBLE BECAUSE OF INADEQUATE
FINANCES AND REFERRED THIS MATTER TO THE SMALL BUSINESS ADMINISTRATION
(SBA) FOR CONSIDERATION UNDER ITS CERTIFICATE OF COMPETENCY (COC)
PROCEDURE. ON NOVEMBER 2, 1982, SBA ISSUED A COC TO COAST. THEREAFTER,
THE CONTRACTING OFFICER WAS INFORMED BY GSA HEADQUARTERS THAT CONGRESS
HAD PASSED THE JOINT CONTINUING RESOLUTION OF DECEMBER 21, 1982, PUB.L.
NO. 97-377, 96 STAT. 1830, 1913, WHICH PROHIBITED GSA FROM OBLIGATING
FUNDS FOR CONTRACTING OUT FOR JANITORIAL SERVICES THAT WERE BEING
PERFORMED BY GSA EMPLOYEES PRIOR TO THE DATE OF THE ENACTMENT OF THE
JOINT RESOLUTION. THE CONTRACTING OFFICER BELIEVED THAT THIS LAW
REQUIRED THE PROCUREMENT TO BE DISCONTINUED AND ON JANUARY 12, 1983, SHE
CANCELED THE SOLICITATION.
COAST CONTENDS THAT THE CANCELLATION WAS IMPROPER BECAUSE IT WAS NOT
BASED ON ONE OF THE JUSTIFICATIONS FOR CANCELLATION ENUMERATED IN
FEDERAL PROCUREMENT REGULATIONS (FPR) SEC. 1-2.404-1. COAST ALSO ARGUES
THAT THE JOINT RESOLUTION SHOULD NOT BE APPLICABLE TO THIS PROCUREMENT
BECAUSE ITS BID PRICE WAS LESS THAN THE PRICE PAID TO THE INCUMBENT, AND
LESS THAN THE COST TO THE GOVERNMENT TO DO THE WORK ITSELF.
CANCELLATION OF A SOLICITATION AFTER BID OPENING AND THE EXPOSURE OF
BIDS IS NOT PERMITTED UNLESS A COGENT AND COMPELLING REASON FOR
CANCELLATION EXISTS. THE DETERMINATION AS TO WHETHER SUCH A REASON
EXISTS IS, HOWEVER, AN ADMINISTRATIVE ONE TO WHICH WE WILL NOT OBJECT
UNLESS THE PROTESTER CAN DEMONSTRATE THAT THE DECISION WAS ARBITRARY,
CAPRICIOUS, OR NOT SUPPORTED BY SUBSTANTIAL EVIDENCE. MCGREGOR PRINTING
CORPORATION, B-207084; B-207377, SEPTEMBER 20, 1982, 82-2 CPD 240.
WE AGREE WITH GSA THAT IT WAS PROHIBITED BY THE JOINT RESOLUTION FROM
CONTRACTING OUT FOR THE JANITORIAL SERVICES ENCOMPASSED UNDER PHASE II
OF THE BID SCHEDULE. SEE CONSOLIDATED MAINTENANCE COMPANY, B-209766,
MARCH 7, 1983, 83-1 CPD 225. THE FACT THAT THE PROTESTER'S BID WAS LESS
THAN THE COST TO THE GOVERNMENT OF PERFORMING THIS WORK IN-HOUSE DOES
NOT ALTER THE FACT THAT THE JOINT RESOLUTION PROHIBITS THE AGENCY FROM
CONTRACTING FOR THESE SERVICES.
FURTHER, COAST'S CONTENTION THAT THE CANCELLATION WAS IMPROPER
BECAUSE IT WAS NOT BASED ON ONE OF THE JUSTIFICATIONS FOR CANCELLATION
ENUMERATED IN FPR SEC. 1-2.404-1(B) IS WITHOUT MERIT. THAT REGULATION
REQUIRES A COMPELLING REASON FOR CANCELLATION AND A DETERMINATION BY THE
CONTRACTING OFFICER THAT CANCELLATION IS IN THE BEST INTEREST OF THE
GOVERNMENT. THE ENUMERATED REASONS ARE MERELY EXAMPLES OF CIRCUMSTANCES
JUSTIFYING CANCELLATION AND ARE NOT INTENDED TO EXCLUDE OTHER INSTANCES
WHERE THE CONTRACTING OFFICER USING HIS BROAD DISCRETION REASONABLY
DETERMINES THAT CANCELLATION OF ALL OR A PORTION OF A SOLICITATION IS IN
THE BEST INTEREST OF THE GOVERNMENT. SEE, E. G., MCCAIN TRAIL
CONSTRUCTION CO., B-196856, JULY 8, 1980, 80-2 CPD 16 (COMPELLING REASON
TO CANCEL SOLICITATION EXISTED WHERE CONTRACTING AGENCY DETERMINED TAT
ADEQUATE FUNDS WERE NOT AVAILABLE FOR CONTRACT OBLIGATION).
THUS, GSA CLEARLY HAD A PROPER BASIS FOR CANCELING THE PHASE II
PORTION OF THE SOLICITATION. THE PROTESTER, HOWEVER, CHALLENGES GSA'S
DECISION TO CANCEL THE ENTIRE SOLICITATION. GSA STATES THAT IT DID SO
BECAUSE (1) IT NEVER INTENDED TO AWARD ONLY PHASE I, (2) THE
SOLICITATION DID NOT PERMIT AWARD OF ONLY PHASE I, AND (3) THE WORK
COVERED BY PHASE I WAS AT THE TIME OF THE CANCELLATION BEING PERFORMED
BY THE INCUMBENT CONTRACTOR UNDER THE OPTION EXERCISED EARLIER. GSA
EXPLAINS THAT THE CONTRACTING OFFICER EXERCISED THAT OPTION IN GOOD
FAITH BECAUSE THE SERVICES WERE NEEDED DURING THE SOLICITATION PERIOD.
IT APPEARS THAT GSA RECOGNIZED THAT THERE WOULD BE AN OVERLAP IN THE
PERFORMANCE PERIODS INCLUDED IN THE SOLICITATION (JANUARY 1 -DECEMBER 3,
1983) AND IN THE INCUMBENT'S EXTENDED CONTRACT (JUNE 1982-JUNE 1983).
IT APPARENTLY CONTEMPLATED ULTIMATELY TERMINATING THE INCUMBENT'S
CONTRACT FOR THE CONVENIENCE OF THE GOVERNMENT SO THAT IT COULD HAVE A
SINGLE CONTRACTOR FOR PHASE I AND PHASE II; HOWEVER, AFTER LEARNING
THAT THE JOINT RESOLUTION WOULD PROHIBIT IT FROM AWARDING PHASE II, GSA
EXPLAINS THAT IT DID NOT FEEL THAT TERMINATION FOR CONVENIENCE WOULD BE
APPROPRIATE IN LIGHT OF TORNCELLO V. UNITED STATES, 681 F.2D 756 (CT.CL.
1982) (WHICH SEVERELY RESTRICTED A CONTRACTING AGENCY'S RIGHT TO USE THE
TERMINATION FOR CONVENIENCE CLAUSE IN ORDER TO OBTAIN THE SUBJECT MATTER
OF THE CONTRACT FROM ANOTHER FIRM AT A LOWER PRICE), SINCE THE
TERMINATION HERE WOULD BE BASED SOLELY ON THE FACT THAT GSA RECEIVED A
LOWER BID PRICE UNDER THE SOLICITATION FOR PHASE I THAN IT WAS CURRENTLY
BEING CHARGED BY THE INCUMBENT.
IT IS NOT CLEAR WHY GSA BELIEVES THE SOLICITATION DID NOT PERMIT A
SEPARATE AWARD OF THE PHASE I REQUIREMENT. THE SOLICITATION PROVIDED AT
SECTION B THAT "PHASE II IS SUBJECT TO OMB A-76, IS SUBJECT TO REVIEW BY
THE GOVERNMENT, AND AT THE GOVERNMENT'S OPTION, MAY NOT BE AWARDED, OR
IF AWARDED, MAY BE AWARDED AT A LATER DATE." THUS, THE INABILITY OF GSA
TO AWARD THE PHASE II REQUIREMENT DID NOT ALONE PROVIDE A BASIS FOR THE
CANCELLATION OF THE ENTIRE SOLICITATION. HOWEVER, IN LIGHT OF THE
TORNCELLO CASE AND GSA'S RESULTING CONCERN OVER THE PROPRIETY OF A
TERMINATION UNDER THE CIRCUMSTANCES HERE, WE DO NOT THINK THE AGENCY
ACTED ARBITRARILY IN DECIDING NOT TO TERMINATE THE EXISTING CONTRACT BUT
INSTEAD CANCEL THE SOLICITATION.
FINALLY, WE HAVE NO BASIS UPON WHICH TO AWARD COAST ITS BID
PREPARATION COSTS AS IT REQUESTS. A PREREQUISITE TO ENTITLEMENT TO SUCH
COSTS AS A RESULT OF CANCELLATION OF A SOLICITATION IS A SHOWING THAT
THE GOVERNMENT ACTED ARBITRARILY OR CAPRICIOUSLY OR IN BAD FAITH WITH
RESPECT TO A CLAIMANTS BID OR PROPOSAL. HEYER PRODUCTS CO. V. UNITED
STATES, 140 F.SUPP. 409 (CT.CL. 1956); CHRYSLER CORPORATION, B-206943,
SEPTEMBER 24, 1982, 82-2 CPD 271. HERE, WE HAVE FOUND THAT THE AGENCY
HAD A REASONABLE BASIS FOR ITS DECISION TO CANCEL. MOREOVER, WHILE THIS
DECISION MAY HAVE BEEN BASED IN PART ON INFORMATION AVAILABLE PRIOR TO
THE BID OPENING DATE, THERE IS NO ALLEGATION THAT THE BIDS WERE
SOLICITED OR OPENED IN BAD FAITH.
THE PROTEST AND CLAIM ARE DENIED.
FN1 PHASE I COVERED SERVICES IN FOUR BUILDINGS WHILE PHASE II ONLY
COVERED SERVICES FOR A PORTION OF ONE OF THE BUILDINGS.
B-210652, FEB 9, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
ALLEGATIONS THAT A BIDDER DOES NOT HAVE THE NECESSARY FACILITIES,
EXPERIENCE OR PERSONNEL TO PERFORM A CONTRACT AND THAT THE BIDDER COULD
NOT PERFORM AT ITS BID PRICE INVOLVE THE RESPONSIBILITY OF THE BIDDER,
THE AFFIRMATIVE DETERMINATION OF WHICH IS NOT REVIEWED BY GAO EXCEPT IN
CIRCUMSTANCES NOT APPLICABLE HERE.
WEAVER SHIPYARD & DRYDOCK, INC.:
WEAVER SHIPYARD & DRYDOCK, INC., (WEAVER) PROTESTS THE NAVY'S
DECISION TO AWARD A CONTRACT TO TRI-MARINE INDUSTRIES, INC. (TMI) UNDER
REQUEST FOR PROPOSALS NO. N00024-83-R-2025 FOR 35-FOOT SEA SHEDS.
WEAVER ALLEGES THAT TMI DOES NOT HAVE THE EXPERIENCE, PRODUCTION
FACILITIES OR PERSONNEL TO PERFORM THIS CONTRACT. WEAVER ALSO CONTENDS
THAT TMI CANNOT PERFORM THE CONTRACT AT ITS LOW BID PRICE. WE DISMISS
THE PROTEST.
THE ABILITY OF A BIDDER TO PERFORM A CONTRACT IS A MATTER FOR THE
CONTRACTING OFFICER'S JUDGMENT IN DETERMINING THE BIDDER'S
RESPONSIBILITY AS A PROSPECTIVE CONTRACTOR. OUR OFFICE DOES NOT REVIEW
A CONTRACTING AGENCY'S AFFIRMATIVE DETERMINATION OR RESPONSIBILITY
UNLESS EITHER POSSIBLE FRAUD IS SHOWN ON THE PART OF THE PROCURING
AGENCY OR THE SOLICITATION CONTAINS DEFINITIVE RESPONSIBILITY CRITERIA
WHICH ALLEGEDLY HAVE NOT BEEN APPLIED. C.R.DANIELS, INC., B-207937,
JULY 1, 1982, 82-2 CPD 13. NEITHER EXCEPTION IS APPLICABLE HERE.
TMI'S SUBMISSION OF A BELOW-COST BID IS NOT ITSELF A BASIS TO
CHALLENGE THE VALIDITY OF A CONTRACT AWARD. AMERICAN MUTUAL PROTECTIVE
BUREAU, B-208067, JULY 16, 1982, 82-2 CPD 52. WHETHER A BIDDER CAN
PERFORM AT ITS BID PRICE IS ONE OF THE MATTERS CONSIDERED BY THE
CONTRACTING OFFICER IN DETERMINING RESPONSIBILITY. AS INDICATED ABOVE,
WE WILL NOT REVIEW THAT DETERMINATION HERE.
THE PROTEST IS DISMISSED.
B-210652.2, APR 5, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL DISMISS A REQUEST FOR RECONSIDERATION RELYING ON NEW GROUNDS
FOR PROTEST WHEN THE REQUEST IS NOT FILED WITHIN 10 WORKING DAYS AFTER
THE BASIS FOR THE PROTEST IS KNOWN OR SHOULD BE KNOWN, WHICHEVER IS
EARLIER. NEW GROUNDS OF PROTEST MUST INDEPENDENTLY SATISFY THE
TIMELINESS REQUIREMENTS OF GAO BID PROTEST PROCEDURES.
WEAVER SHIPYARD & DRYDOCK, INC. - REQUEST FOR RECONSIDERATION:
WEAVER SHIPYARD & DRYDOCK, INC. REQUESTS RECONSIDERATION OF OUR
DECISION IN WEAVER SHIPYARD & DRYDOCK, INC., B-210652, FEBRUARY 9, 1983,
83-1 CPD 146, CONCERNING THE DEPARTMENT OF THE NAVY'S AWARD OF A
CONTRACT FOR 35-FOOT SEA SLEDS TO TRI-MARINE INDUSTRIES, INC. UNDER
REQUEST FOR PROPOSALS NO. N00024-83-R-2025. WE DISMISS THE REQUEST FOR
RECONSIDERATION.
WEAVER ALLEGED THAT TRI-MARINE LACKED THE EXPERIENCE, PRODUCTION
FACILITIES, OR PERSONNEL TO PERFORM THE CONTRACT, AND WAS THEREFORE
NONRESPONSIBLE. WE DISMISSED THE PROTEST ON THIS GROUND, SINCE IT IS
OUR POLICY NOT TO REVIEW A CONTRACTING AGENCY'S AFFIRMATIVE
DETERMINATION OF RESPONSIBILITY IN THE ABSENCE OF EITHER A SHOWING OF
POSSIBLE FRAUD ON THE PART OF PROCURING OFFICIALS OR AN ALLEGATION THAT
DEFINITIVE RESPONSIBILITY CRITERIA HAVE NOT BEEN APPLIED. IN ADDITION,
WEAVER ORIGINALLY CONTENDED THAT TRI-MARINE HAD SUBMITTED A BELOW-COST
BID. WE ALSO DISMISSED THE PROTEST ON THIS GROUND, HOLDING THAT
SUBMISSION OF A BELOW-COST BID IS NOT ITSELF A BASIS FOR CHALLENGING THE
VALIDITY OF AN AWARD.
IN ITS REQUEST FOR RECONSIDERATION, WEAVER CONTENDS THAT IN
EVALUATING TRI-MARINE'S TECHNICAL PROPOSAL, THE NAVY DID NOT PROPERLY
APPLY THE EVALUATION FACTORS CONCERNING MANAGEMENT, RESOURCES, AND
EXPERIENCE SET FORTH IN THE REQUEST FOR PROPOSALS. WE CONSIDER THE
PROTEST ON THIS BASIS UNTIMELY.
OUR BID PROTEST PROCEDURES REQUIRE THAT A REQUEST FOR RECONSIDERATION
CONTAIN A DETAILED STATEMENT OF THE FACTUAL AND LEGAL GROUNDS UPON WHICH
REVERSAL OR MODIFICATION IS DEEMED WARRANTED, SPECIFYING ANY ERRORS OF
LAW MADE OR INFORMATION NOT PREVIOUSLY CONSIDERED. 4 C.F.R. SEC.
21.9(A) (1982). INFORMATION NOT PREVIOUSLY CONSIDERED REFERS TO THAT
WHICH A PARTY BELIEVES MAY HAVE BEEN OVERLOOKED BY OUR OFFICE OR TO
WHICH A PARTY DID NOT HAVE ACCESS DURING THE PENDENCY OF THE ORIGINAL
PROTEST. THE PROCEDURES DO NOT CONTEMPLATE A PIECEMEAL PRESENTATION OR
DEVELOPMENT OF PROTEST ISSUES, DISRUPTING THE PROCUREMENT PROCESS.
B&MMARINE REPAIRS, INC. - REQUEST FOR RECONSIDERATION, B-202966.2,
FEBRUARY 16, 1982, 82-1 CPD 131.
IN ITS REQUEST FOR RECONSIDERATION, WEAVER FAILS TO SPECIFY ANY
ERRORS OF LAW WE MAY HAVE MADE IN OUR PRIOR DECISION. NOR DOES WEAVER
PRESENT ANY INFORMATION TO WHICH IT DID NOT HAVE ACCESS AT THE TIME OF
ITS PRIOR PROTEST, WHICH WAS COUCHED SOLELY IN TERMS OF TRI-MARINE'S
ALLEGED NONRESPONSIBILITY. RATHER, WEAVER NOW RESTATES INFORMATION
CONCERNING TRI-MARINE TO WHICH IT HAD ALLUDED IN ITS PRIOR PROTEST AND
ARGUES THAT THE NAVY MISAPPLIED EVALUATION FACTORS.
EVEN IF WE REGARD THIS AS A NEW GROUND OF PROTEST, WE FIND IT
UNTIMELY. NEW GROUNDS OF PROTEST MUST INDEPENDENTLY SATISFY THE
TIMELINESS REQUIREMENTS OF OUR BID PROTEST PROCEDURES, TOMBS & SONS,
INC., B-206810.4, AUGUST 2, 1982, 82-2 CPD 100, AND THUS MUST BE FILED
WITHIN 10 WORKING DAYS AFTER THE BASIS FOR THEM IS KNOWN OR SHOULD HAVE
BEEN KNOWN, WHICHEVER IS EARLIER. 4 C.F.R. SEC. 21.2(B)(2). THOUGH
WEAVER WAS AWARE OF THE ALLEGEDLY IMPROPER EVALUATION AT LEAST AS EARLY
AS JANUARY 27, 1983, WHEN IT DISPATCHED ITS ORIGINAL PROTEST BY TELEX,
WE DID NOT RECEIVE WEAVER'S REQUEST FOR RECONSIDERATION UNTIL FEBRUARY
16, 1983, MORE THAN 10 WORKING DAYS LATER.
IN ANY CASE, WEAVER'S PROTEST CONCERNING TRI-MARINE'S RESPONSIBILITY
APPEARS ACADEMIC. WE HAVE BEEN INFORMALLY ADVISED BY THE NAVY THAT IT
HAS FOUND TRI-MARINE NONRESPONSIBLE AND HAS REFERRED THE MATTER TO THE
SMALL BUSINESS ADMINISTRATION, WHICH WILL CONCLUSIVELY RESOLVE THE
MATTER BY ISSUING OR REFUSING TO ISSUE A CERTIFICATE OF COMPETENCY. SEE
15 U.S.C. SEC. 637(B)(7)A (SUPP. IV 1980); SPACE AGE ENGINEERING, INC.,
B-207537, JULY 6, 1982, 82-2 CPD 22.
THE REQUEST FOR RECONSIDERATION IS DISMISSED.
B-210652.3, MAY 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO GENERALLY WILL NOT REVIEW DENIAL OF A CERTIFICATE OF COMPETENCY,
SINCE SMALL BUSINESS ADMINISTRATION HAS CONCLUSIVE STATUTORY AUTHORITY
TO DETERMINE ALL ELEMENTS OF SMALL BUSINESS BIDDER'S RESPONSIBILITY.
FAILURE TO ADOPT REGIONAL OFFICE'S AFFIRMATIVE RECOMMENDATION DOES NOT,
OF ITSELF, SHOW FRAUD OR BAD FAITH ON THE PART OF SBA HEADQUARTERS
OFFICIALS, SINCE THIS IS A BUSINESS JUDGMENT OF THE TYPE THAT SUCH
OFFICIALS ARE EXPECTED TO MAKE. NOR ARE SBA'S COORDINATION OF
INFORMATION WITH PROCURING ACTIVITY, ADOPTION OF PRE-AWARD SURVEY
FINDINGS, OR FAILURE TO PROVIDE BIDDER WITH OPPORTUNITY TO SUPPLEMENT
INFORMATION IN APPLICATION EVIDENCE OF FRAUD OR BAD FAITH SUFFICIENT TO
INVOKE GAO REVIEW.
TRI-MARINE INDUSTRIES, INC.:
TRI-MARINE INDUSTRIES, INC. PROTESTS THE AWARD OF A CONTRACT TO THE
DENARDI CORPORATION UNDER REQUEST FOR PROPOSALS NO. N00024-83-R-2025,
ISSUED OCTOBER 21, 1982, BY THE NAVAL SEA SYSTEMS COMMAND. TRI-MARINE
BELIEVES IT WAS IMPROPERLY DENIED A CERTIFICATE OF COMPETENCY BY THE
SMALL BUSINESS ADMINISTRATION (SBA). WE DISMISS THE PROTEST.
TRI-MARINE WAS THE LOW OFFEROR FOR A FIRM FIXED-PRICE CONTRACT TO
FABRICATE AND INSTALL 35-FOOT "SEA SHEDS" THAT WILL BE USED TO MODIFY
HOLDS SO THAT BATTLE TANKS, HEAVY EQUIPMENT, AND SUPPLIES NOT SUITABLE
FOR CONTAINERIZATION CAN BE TRANSPORTED BY SHIP. THE CONTRACTING
OFFICER, HOWEVER, FOUND TRI-MARINE NONRESPONSIBLE ON THE BASIS OF A
PRE-AWARD SURVEY INDICATING (1) LACK OF UNDERSTANDING BY A PROSPECTIVE
SUBCONTRACTOR REGARDING PLANNING AND SCHEDULING NECESSARY TO MEET THE
NAVY'S DELIVERY SCHEDULE; (2) LACK OF FIRM AGREEMENTS WITH
SUBCONTRACTORS; AND (3) LACK OF FULLY DEVELOPED PRODUCTION MILESTONES.
THE MATTER WAS REFERRED TO SBA'S REGION IX OFFICE IN SAN FRANCISCO,
CALIFORNIA, WHICH RECOMMENDED ISSUANCE OF A CERTIFICATE OF COMPETENCY.
BECAUSE THE PROCUREMENT EXCEEDED $500,000, HOWEVER, SBA'S CENTRAL OFFICE
IN WASHINGTON, D. C., WAS REQUIRED TO APPROVE IT. THIS OFFICE DECLINED
TO ISSUE THE CERTIFICATE, APPARENTLY ON THE BASIS OF INSUFFICIENT
INFORMATION REGARDING TRI-MARINE'S FINANCIAL CONDITION.
AS WE HAVE OFTEN POINTED OUT, THE SBA HAS CONCLUSIVE, STATUTORY
AUTHORITY TO CERTIFY THE COMPETENCY OF ANY SMALL BUSINESS AS TO ALL
ELEMENTS OF RESPONSIBILITY. SEE 15 U.S.C. SEC. 637(B)(7) (SUPP. IV
1980). OUR OFFICE WILL REVIEW AN SBA DECISION TO ISSUE OR NOT TO ISSUE
A CERTIFICATE OF COMPETENCY ONLY IN LIMITED CIRCUMSTANCES, I.E., WHEN
THERE IS A SHOWING EITHER OF POSSIBLE FRAUD ON THE PART OF GOVERNMENT
OFFICIALS OR OF SUCH WILLFUL DISREGARD OF THE FACTS AS TO IMPLY BAD
FAITH. (ALTHOUGH NOT AT ISSUE HERE, WE ALSO WILL REVIEW THE ALLEGED
FAILURE OF SUCH OFFICIALS TO FOLLOW SBA REGULATIONS OR TO CONSIDER
CERTAIN VITAL INFORMATION BEARING ON A SMALL BUSINESS BIDDER'S
RESPONSIBILITY. SEE SKILLENS ENTERPRISES, 61 COMP.GEN. 142 (1981), 81-2
CPD 472; J.BARANELLO AND SONS, 58 COMP.GEN. 509 (1979), 79-1 CPD 322.
IN OUR OPINION, TRI-MARINE HAS NOT MADE A SHOWING OF THE TYPE
NECESSARY TO INVOKE OUR REVIEW HERE. ALTHOUGH THE FIRM MAKES
APPROXIMATELY A DOZEN ALLEGATIONS, THE ESSENCE OF ITS PROTEST IS THAT
BECAUSE SBA HEADQUARTERS FAILED TO ADOPT A REGIONAL OFFICE'S
RECOMMENDATION TO ISSUE A CERTIFICATE OF COMPETENCY, GOVERNMENT
OFFICIALS ACTED FRAUDULENTLY OR IN BAD FAITH. SBA REGULATIONS, HOWEVER,
REQUIRE REFERRAL OF A RECOMMENDATION FOR ISSUANCE OF A CERTIFICATE OF
COMPETENCY WHENEVER A PROCUREMENT EXCEEDS $500,000. 13 C.F.R. SEC.
125.5(C) (1982). THIS PROCEDURE, BY ITS VERY EXISTENCE, IMPLIES THAT A
CERTAIN NUMBER OF RECOMMENDATIONS WILL NOT BE ACCEPTED. THE DEFENSE
ACQUISITION REGULATION (DAR) ALSO RECOGNIZES THAT SBA HEADQUARTERS MAY
NOT CONCUR WITH THE PROPOSED AFFIRMATIVE DETERMINATION OF A FIELD
OFFICE. SEE DAR SEC. 1-705.4(F) (DEFENSE ACQUISITION CIRCULAR 76-24,
AUGUST 28, 1980). A DENIAL OF A CERTIFICATE OF COMPETENCY, DESPITE A
REGIONAL OFFICE'S RECOMMENDATION THAT ONE SHOULD BE ISSUED, IS THEREFORE
THE TYPE OF BUSINESS JUDGMENT THAT HEADQUARTERS OFFICIALS ARE ON
OCCASION EXPECTED TO MAKE AND DOES NOT, OF ITSELF, SHOW FRAUD OR BAD
FAITH ON THE PART OF SUCH OFFICIALS.
TRI-MARINE'S SECOND BROAD BASIS OF PROTEST INVOLVES ALLEGEDLY
IMPROPER CONTACTS BETWEEN THE NAVY AND SBA. THE DAR, HOWEVER, REQUIRES
PROCURING ACTIVITIES TO MAINTAIN CLOSE LIAISON WITH SBA, TO ENDEAVOR TO
REACH AGREEMENT WITH SBA, AND TO PROVIDE SBA WITH THEIR VIEWS, INCLUDING
COPIES OF PRE-AWARD SURVEYS AND OTHER DOCUMENTS SUPPORTING A CONTRACTING
OFFICER'S NONRESPONSIBILITY DETERMINATION. DAR SEC. 1-705.4(C)(3)(A)
AND (D). ALTHOUGH TRI-MARINE ALLEGES THAT NAVY OFFICIALS AND CENTRAL
SBA "MADE A DEAL" TO DENY THE CERTIFICATE OF COMPETENCY, NEITHER THE
FACT THAT NAVY OFFICIALS MET WITH SBA NOR THAT SBA REVIEWED AND ADOPTED
THE PRE-AWARD SURVEY FINDINGS IS EVIDENCE OF FRAUD OR BAD FAITH.
TRI-MARINE FURTHER ALLEGES THAT SBA FAILED TO IDENTIFY MISSING
FINANCIAL DATA OR TO CONTACT TRI-MARINE AND GIVE IT AN OPPORTUNITY TO
PROVIDE ADDITIONAL INFORMATION. THERE IS NO STATUTORY OR REGULATORY
REQUIREMENT THAT SBA PROVIDE APPLICANTS FOR A CERTIFICATE OF COMPETENCY
WITH AN OPPORTUNITY TO PROVIDE INFORMATION OTHER THAN THAT IN THEIR
INITIAL APPLICATIONS. RATHER, UNSUCCESSFUL APPLICANTS MAY MEET WITH
SBA, BUT THE REGULATIONS SPECIFICALLY STATE THAT SUCH MEETINGS WILL BE
"FOR THE SOLE PURPOSE OF ENABLING THE APPLICANT TO IMPROVE OR CORRECT
DEFICIENCIES AND WILL NOT CONSTITUTE A BASIS FOR REOPENING THE CASE IN
WHICH THE CERTIFICATE WAS DENIED." 13 C.F.R. SEC. 125.5(D), SUPRA.
THE MATERIALS THAT TRI-MARINE HAS PRESENTED TO OUR OFFICE INDICATE
THAT IT DISAGREES WITH THE CONCLUSIONS THE NAVY AND SBA DREW FROM THE
PRE-AWARD SURVEY, RATHER THAN WITH THE FACTS REVEALED BY THAT SURVEY.
FOR EXAMPLE, TRI-MARINE ACKNOWLEDGES THAT ITS FINANCIAL STATEMENT FOR
THE FIRST YEAR OF OPERATION SHOWED A NET LOSS, BUT ARGUES THAT THIS WAS
A RESULT OF DEPRECIATION AND AMORTIZATION OF FACILITIES FOR TAX
PURPOSES, AND THAT ITS CASH FLOW AND CREDIT ARE SUFFICIENT TO PERFORM
THE CONTRACT. IN ADDITION, THE FIRM CONTENDS THAT NEITHER SUBCONTRACTS
NOR LEASES WOULD NORMALLY BE ENTERED INTO UNTIL AFTER AWARD OF A
CONTRACT, AND THAT A DETAILED PRODUCTION SCHEDULE ALSO WOULD BE PROVIDED
AFTER AWARD. NONE OF THESE ARGUMENTS, HOWEVER, SUPPORTS AN ALLEGATION
THAT SBA RECKLESSLY DISREGARDED THE FACTS OF THE PRE-AWARD SURVEY.
WHILE TRI-MARINE OBVIOUSLY BELIEVES THAT SBA SHOULD HAVE REACHED A
DIFFERENT CONCLUSION WITH REGARD TO ITS RESPONSIBILITY, IT HAS NOT SHOWN
A REASONABLE POSSIBILITY THAT IT WAS DENIED A CERTIFICATE OF COMPETENCY
DUE TO FRAUD OR BAD FAITH ON THE PART OF GOVERNMENT OFFICIALS.
THE PROTEST IS DISMISSED.
B-210651, MAR 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHETHER A BIDDER IN FACT SUPPLIES ITEMS MANUFACTURED BY A SMALL
BUSINESS IS A MATTER OF CONTRACT ADMINISTRATION, WHICH IS THE
RESPONSIBILITY OF THE CONTRACTING AGENCY AND NOT FOR CONSIDERATION BY
GAO.
UNIT PORTIONS, INC.:
UNIT PORTIONS, INC. (UNIT PORTIONS), PROTESTS THE AWARD OF A CONTRACT
TO THREE FIRMS UNDER INVITATION FOR BIDS NO. DABT47-83-B-0014, A SMALL
BUSINESS SET-ASIDE, ISSUED BY THE DEPARTMENT OF THE ARMY (ARMY). UNIT
PORTIONS ALLEGES THAT THESE BIDDERS WILL NOT DELIVER END ITEMS
MANUFACTURED OR PRODUCED BY SMALL BUSINESS CONCERNS, WHICH IS CONTRARY
TO THE CERTIFICATION MADE BY THESE FIRMS IN THEIR BIDS. UNIT PORTIONS
ASKS THAT WE RULE AS INVALID THE CONTRACTS TO THOSE FIRMS WHICH WILL NOT
DELIVER SMALL BUSINESS PRODUCTS.
WE DISMISS THE PROTEST.
THE SOLICITATION CONTAINED A REQUIREMENT THAT BIDDERS CERTIFY THAT
THEY ARE SMALL BUSINESSES AND THAT IF THEY DO NOT MANUFACTURE THE
SUPPLIES TO BE FURNISHED UNDER THE CONTRACT, THE SUPPLIES WILL BE
MANUFACTURED OR PRODUCED BY A SMALL BUSINESS. THE FIRMS WHICH WERE
AWARDED CONTRACTS CERTIFIED THAT THEY WERE SMALL BUSINESSES AND THAT
THEY WOULD NOT MANUFACTURE THE SUPPLIES TO BE FURNISHED, BUT WOULD
PROVIDE SUPPLIES MANUFACTURED BY A SMALL BUSINESS.
UNIT PORTIONS DOES NOT ALLEGE THAT THE BIDDERS TOOK ANY AN END ITEM
MANUFACTURED OR PRODUCED BY A SMALL BUSINESS. ACCORDINGLY, THE ARMY'S
ACCEPTANCE OF THESE BIDS RESULTED IN AN OBLIGATION ON THE PART OF THE
BIDDER TO FURNISH A SMALL BUSINESS END ITEM.
WHETHER THESE FIRMS COMPLY WITH THIS OBLIGATION AND, IN FACT, PROVIDE
SUPPLIES MANUFACTURED BY A SMALL BUSINESS IS A MATTER OF CONTRACT
ADMINISTRATION, WHICH IS THE PRIMARY RESPONSIBILITY OF THE CONTRACTING
AGENCY AND NOT FOR CONSIDERATION BY OUR OFFICE. UNIT PORTIONS INC.,
B-202783, OCTOBER 14, 1981, 81-2 CPD 308. IN THIS CONNECTION, WE HAVE
BEEN ADVISED BY THE ARMY THAT IT HAS SENT LETTERS TO THE AWARDEES,
COPIES OF WHICH WERE SENT TO THE PROTESTER, ADVISING THEM THAT THEY MUST
SUPPLY SMALL BUSINESS END ITEMS AND THAT THE ARMY WILL BE MONITORING THE
DELIVERY TO ENSURE COMPLIANCE.
WE DISMISS THE PROTEST.
B-210649, MAR 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
CLAIM FOR PROPOSAL PREPARATION COSTS BASED ON MATTERS NOT TIMELY
PROTESTED WILL NOT BE CONSIDERED.
MAXSON CORPORATION:
MAXSON CORPORATION (MAXSON) SUBMITS A CLAIM FOR PROPOSAL PREPARATION
COSTS IN CONNECTION WITH ITS PARTICIPATION IN A PROCUREMENT UNDER
REQUEST FOR PROPOSALS MOBILITY EQUIPMENT RESEARCH AND DEVELOPMENT
COMMAND (ARMY), FORT BELVOIR, VIRGINIA.
WE DISMISS THE CLAIM BECAUSE IT IS BASED ON MATTERS NOT TIMELY
PROTESTED.
MAXSON BASES ITS CLAIM ON THE ARMY'S ALLEGEDLY IMPROPER EXCLUSION OF
MAXSON FROM THE COMPETITIVE RANGE AND THE RESULTING EXCLUSION OF MAXSON
FROM NEGOTIATIONS. MAXSON LEARNED THAT THE ARMY WOULD NOT NEGOTIATE
WITH IT AND THAT ANOTHER FIRM HAD BEEN SELECTED FOR AWARD ON AUGUST 31,
1982. ON OCTOBER 20, 1982, MAXSON FILED A CLAIM FOR PROPOSAL
PREPARATION COSTS WITH THE CONTRACTING OFFICER. AFTER AN EXCHANGE OF
CORRESPONDENCE, THE CONTRACTING 1982. MAXSON FILED ITS CLAIM WITH GAO
ON JANUARY 31, 1983.
GAO WILL NOT CONSIDER A CLAIM FOR BID OR PROPOSAL PREPARATION COSTS
WHICH IS BASED ON ISSUES NOT TIMELY PROTESTED. MIL-AIR, INC., B-191424,
JULY 20, 1978, 78-2 CPD 55. TO BE TIMELY FILED, A PROTEST MUST BE FILED
WITH EITHER GAO OR THE CONTRACTING AGENCY WITHIN 10 WORKING DAYS OF THE
DATE THAT THE PROTESTER WAS AWARE OF THE BASIS FOR ITS PROTEST. 4
C.F.R. SEC. 21.2(B) (1982).
MAXSON KNEW THE BASIS OF THE PROTEST ON AUGUST 31, 1982. EVEN IF
MAXSON'S CLAIM OF OCTOBER 20, 1982, IS CONSIDERED A PROTEST TO THE ARMY,
WHICH IT DOES NOT APPEAR TO BE, IT WAS FILED MORE THAN 10 WORKING DAYS
AFTER AUGUST 31, 1982, AND IS UNTIMELY.
CONSEQUENTLY, WE DISMISS THE CLAIM.
B-210649.2, JUN 21, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PRIOR DECISION DISMISSED CLAIM FOR BID PREPARATION COSTS BECAUSE
PROTEST OF MATTERS UPON WHICH CLAIM WAS BASED WAS NOT TIMELY FILED WITH
AGENCY. PROTESTER NOW ASSERTS NEW FACTS WHICH, IF ACCEPTED AS TRUE,
WOULD MAKE AGENCY PROTEST TIMELY. HOWEVER, CLAIM IS DISMISSED AND PRIOR
DECISION IS AFFIRMED BECAUSE PROTEST WAS NOT FILED WITH GAO WITHIN 10
WORKING DAYS OF AGENCY DENIAL OF PROTEST.
MAXSON CORPORATION - RECONSIDERATION:
MAXSON CORPORATION (MAXSON) REQUESTS RECONSIDERATION OF OUR DECISION
IN MAXSON CORPORATION, B-210649, MARCH 7, 1983, 83-1 CPD 227, WHICH
DISMISSED MAXSON'S CLAIM FOR PROPOSAL PREPARATION COSTS IN CONNECTION
WITH ITS PARTICIPATION IN A PROCUREMENT UNDER REQUEST FOR PROPOSALS NO.
DAAK70-82-Q-1216, ISSUED BY THE ARMY MOBILITY EQUIPMENT RESEARCH AND
DEVELOPMENT COMMAND (ARMY), FORT BELVOIR, VIRGINIA.
IN THAT DECISION, WE FOUND THAT MAXSON'S CLAIM WAS NOT BASED ON
MATTERS TIMELY PROTESTED - A PREREQUISITE FOR OUR CONSIDERATION OF SUCH
CLAIMS. WE STATED THAT MAXSON HAD KNOWN THE BASIS FOR A PROTEST AND
CLAIM ON AUGUST 31, 1982, YET DID NOT FILE ITS CLAIM WITH THE ARMY UNTIL
OCTOBER 20, 1982. WE THEN STATED THAT "EVEN IF MAXSON'S CLAIM OF
OCTOBER 20, 1982, IS CONSIDERED A PROTEST TO THE ARMY, WHICH IT DOES NOT
APPEAR TO BE," IT WAS UNTIMELY FILED.
MAXSON'S CLAIM IS BASED ON THE ARMY'S ALLEGEDLY IMPROPER FAILURE TO
NEGOTIATE WITH IT. IN FINDING THAT MAXSON KNEW THIS ON AUGUST 31, 1982,
WE RELIED ON STATEMENTS MADE IN A LETTER OF DECEMBER 1, 1982, FROM
MAXSON TO THE ARMY CONCERNING ITS CLAIM. IN THAT LETTER, MAXSON STATED
THAT IT HAD BEEN AUDITED BY THE ARMY ON AUGUST 27, 1982, AND TOLD THAT
IF THE AUDIT WAS SATISFACTORY, IT WOULD BE SELECTED FOR A FINAL
NEGOTIATING SESSION. MAXSON STATED FURTHER THAT ON AUGUST 31, 1982, THE
ARMY AUDITOR "ADVISED US THAT FORT BELVOIR NOTIFIED HIM THAT IT WAS NOT
NECESSARY FOR HIM TO SUBMIT THE AUGUST 27, 1982, AUDIT *** SINCE THEY
HAD SELECTED ANOTHER COMPANY FOR PLACEMENT OF THE ORDER." MAXSON THEN
CALLED THE CONTRACTING ACTIVITY AND WAS ADVISED THAT "IF MAXSON HAD READ
THE FINE PRINT THE ARMY DOES NOT HAVE TO GIVE MAXSON AN OPPORTUNITY TO
NEGOTIATE."
MAXSON NOW CLAIMS THAT IT DID NOT KNOW WITH CERTAINTY THAT IT WOULD
NOT BE PERMITTED TO NEGOTIATE UNTIL IT RECEIVED THE OFFICIAL NOTICE OF
AWARD ON OCTOBER 7, 1982, AND THAT CONVERSATIONS WITH THE ARMY AFTER
AUGUST 31 LED IT TO BELIEVE THAT THE ARMY WAS STILL CONSIDERING
NEGOTIATIONS WITH MAXSON.
EVEN ACCEPTING THESE ASSERTIONS, WE WILL NOT CONSIDER MAXSON'S CLAIM
BECAUSE THE DENIAL OF ITS "PROTEST" WITH THE ARMY WAS NOT APPEALED TO
GAO IN A TIMELY MANNER. SECTION 21.2(A) OF OUR BID PROTEST PROCEDURES, 4
C.F.R. SEC. 21.2(A) (1983), REQUIRES PROTESTERS WHO FILE PROTESTS
INITIALLY WITH THE CONTRACTING AGENCY TO FILE ANY SUBSEQUENT PROTEST
WITH GAO WITHIN 10 WORKING DAYS OF KNOWLEDGE OF INITIAL ADVERSE AGENCY
ACTION. MAXSON'S CLAIM WAS DENIED BY THE ARMY BY LETTER OF DECEMBER 21,
1982, AND RECEIVED BY MAXSON ON DECEMBER 23, 1982. THIS WAS INITIAL
ADVERSE AGENCY ACTION. MAXSON'S CLAIM WITH GAO WAS NOT FILED UNTIL
JANUARY 31, 1983 - SUBSTANTIALLY MORE THAN 10 WORKING DAYS LATER. WE
DISMISSED A CLAIM FOR BID PREPARATION COSTS IN SIMILAR FACTUAL
CIRCUMSTANCES IN THE LAND GROUP OF SALT LAKE CITY, B-202423, APRIL 16,
1981, 81-1 CPD 296.
WE AFFIRM OUR PRIOR DECISION DISMISSING MAXSON'S CLAIM.
B-210648 L/M, APR 4, 1983, OFFICE OF GENERAL COUNSEL
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
BRIGADIER GENERAL ROBERT B. ADAMS, DEPARTMENT OF THE ARMY:
THIS REPLIES TO YOUR REQUEST THAT RELIEF BE GRANTED UNDER THE
PROVISIONS OF 31 U.S.C. SEC. 3527(C) (FORMERLY 31 U.S.C. SEC. 82A-2
(1976)), FOR THE IMPROPER PAYMENT OF FRAUDULENT TRAVEL CLAIMS IN THE
AMOUNT OF $1,374.21 CHARGEABLE TO THE ACCOUNT OF LIEUTENANT COLONEL
(LTC) H. W. NEILL, FINANCE CORPS, SYMBOL NUMBER 6380, FINANCE AND
ACCOUNTING OFFICER, U. S. ARMY QUARTERMASTER CENTER, FORT LEE, VIRGINIA.
THE REQUEST RECITES THE REQUIRED FINDING THAT THE IMPROPER PAYMENT WAS
NOT THE RESULT OF BAD FAITH OR LACK OF DUE CARE ON THE PART OF LTC
NEILL. NEVERTHELESS, WE ARE UNABLE TO GRANT RELIEF.
THE RECORD SHOWS THAT ON SEVEN DIFFERENT OCCASIONS OVER A PERIOD OF 9
MONTHS, SPECIALIST FOUR VINCENT J. RAVENEL FORGED NUMEROUS SIGNATURES ON
TEMPORARY DUTY (TDY) TRAVEL ORDER FORMS IN ORDER TO OBTAIN ADVANCE
TRAVEL MONEY. IN FIVE OF THE SEVEN INSTANCES, SPECIALIST RAVENEL
SUBMITTED TRAVEL VOUCHERS TO SETTLE THE ACCOUNT. IN EACH OF THESE
INSTANCES, SPECIALIST RAVENEL WAS ASSISTED BY A MEMBER OF THE FINANCE
AND ACCOUNTING OFFICE IN THE PREPARATION OF THE VOUCHERS. BY USING
THESE PROCEDURES, SPECIALIST RAVENEL DEFRAUDED THE GOVERNMENT IN THE
AMOUNT OF $6,153.00.
IN MARCH 1980, SPECIALIST RAVENEL'S SUPERVISING OFFICER BECAME AWARE
OF THE FRAUDULENT ACTIVITY WHEN A MEMBER OF THE FINANCE AND ACCOUNTING
OFFICE CALLED THE OFFICER REQUESTING THAT SPECIALIST RAVENEL COME TO THE
FINANCE OFFICE TO COMPLETE A TEMPORARY DUTY (TDY) FORM FOR FEBRUARY
1980. DURING THE ENSUING INVESTIGATION, SPECIALIST RAVENEL ADMITTED ALL
OF THE FRAUDULENT ACTS AND IMMEDIATE COLLECTION AGAINST HIM WAS
INITIATED. THE RECORD STATES THAT $4,778.79 OUT OF THE $6,153.00 WAS
RECOVERED AND THAT COLLECTION EFFORTS WILL CONTINUE TO BE PURSUED.
AN ACCOUNTABLE OFFICER IS PERSONALLY LIABLE FOR DEFICIENCIES IN HIS
ACCOUNTS CAUSED BY ILLEGAL, IMPROPER OR INCORRECT PAYMENTS. HOWEVER,
UNDER THE PROVISIONS OF 31 U.S.C. SEC. 3527(C), SUPRA, THIS OFFICE IS
AUTHORIZED TO GRANT RELIEF FROM LIABILITY UPON A DETERMINATION THAT THE
PAYMENT IS NOT THE RESULT OF BAD FAITH OR LACK OF REASONABLE CARE ON THE
PART OF THE DISBURSING OFFICIAL. SEE, GENERALLY, 54 COMP.GEN. 112
(1974).
THE RECORD INDICATES THAT VARIOUS MEMBERS OF THE FINANCE AND
ACCOUNTING OFFICE, RATHER THAN LTC NEILL, PROCESSED THE FRAUDULENT FORMS
WHICH RESULTED IN THE IMPROPER PAYMENTS. IN THE PAST, IN THOSE
INSTANCES WHERE A SUBORDINATE ACTUALLY WAS RESPONSIBLE FOR THE ERRONEOUS
PAYMENT, RATHER THAN THE ACCOUNTABLE OFFICER HIMSELF, WE HAVE GRANTED
RELIEF UPON A SHOWING THAT THE ACCOUNTABLE OFFICER PROPERLY SUPERVISED
HIS SUBORDINATES BY MAINTAINING AN ADEQUATE SYSTEM OF PROCEDURES AND
CONTROLS TO AVOID ERRORS, AND TOOK STEPS TO SEE THAT THE SYSTEM WAS
EFFECTIVE AND BEING FOLLOWED. SEE, E.G., B-187180, SEPTEMBER 21, 1976.
FROM THE RECORD BEFORE US, HOWEVER, WE CANNOT TELL WHETHER LTC NEILL
MAINTAINED AND POLICED SUCH A SYSTEM. IN FACT, THE REPORT OF
INVESTIGATION DATED DECEMBER 5, 1980, STATES THAT THE TRAVEL ORDER
NUMBERS USED ON THE FRAUDULENT DOCUMENTS HAD BEEN ASSIGNED TO SOMEONE
ELSE, THAT MANY OF THE TRAVEL ORDERS HAD ILLEGIBLE SIGNATURES, AND THAT
THERE WAS NO RECORD OF TRAVEL ORDERS ON WHICH SPECIALIST RAVENEL
RECEIVED ADVANCE PAYMENTS. LTC NEILL'S OWN STATEMENT THAT HIS
INDEPENDENT AUDIT TRACING WITHIN HIS FINANCE OFFICE DID NOT DISCLOSE ANY
IRREGULARITIES AND/OR WRONGDOING BY FINANCE PERSONNEL DOES NOT ADDRESS
THESE APPARENT IRREGULARITIES.
FOR THIS REASON WE ARE UNABLE TO DETERMINE THAT THE IMPROPER PAYMENTS
DID NOT RESULT FROM LACK OF DUE CARE ON LTC NEILL'S PART. WE THEREFORE
DENY THE REQUESTED RELIEF. IF FURTHER EVIDENCE IS PRESENTED THAT
SUPPORTS THE FINDINGS REQUIRED FOR RELIEF, WE WOULD BE HAPPY TO
RECONSIDER THIS DECISION.
B-210647.2, DEC 27, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. TELEGRAPHIC BID WHICH, CONTRARY TO SOLICITATION
REQUIREMENT, MAKES NO MENTION OF BIDDER'S AGREEMENT TO BE BOUND BY
ALL TERMS AND CONDITIONS OF SOLICITATION IS NONRESPONSIVE.
2. WHERE THE PROTESTER HAS FAILED TO SHOW THAT AN
EXECUTED COPY OF SOLICITATION WAS RECEIVED BY THE PROCURING AGENCY
BY THE BID OPENING DATE OR THAT AN EXCEPTION FOR THE RECEIPT OF
LATE BIDS APPLIES, THE PROCURING AGENCY PROPERLY REJECTED THE
EXECUTED COPY AS LATE.
3. CLAIM FOR LOSS OF PROFITS, LEGAL EXPENSES, AND
COSTS INCURRED IN OBTAINING AND RETAINING ADDITIONAL EQUIPMENT IN
PREPARATION FOR THE AWARD IS DENIED SINCE NO LEGAL BASIS EXISTS
WHICH AUTHORIZES SUCH A RECOVERY.
4. CLAIM FOR BID PREPARATION COSTS IS DENIED WHERE
THERE IS NO SHOWING THAT THE GOVERNMENT ACTED ARBITRARILY OR
CAPRICIOUSLY IN REJECTING THE BID.
MIMCO, INC.:
MIMCO, INC. (MIMCO), PROTESTS THE REJECTION OF ITS TELEGRAPHIC BID AS
NONRESPONSIVE UNDER INVITATION FOR BIDS (IFB) NO. DLA700-83-B-0434
ISSUED BY THE DEFENSE CONSTRUCTION SUPPLY CENTER (DCSC), A FIELD
ACTIVITY OF THE DEFENSE LOGISTICS AGENCY, FOR 1,607 FIREHOSE NOZZLES.
WE DENY THE PROTEST AND THE CLAIM FOR BID PREPARATION COSTS AND OTHER
COSTS.
MIMCO WIRED A BID TO DCSC ON JANUARY 11, 1983, A DAY BEFORE THE BID
OPENING DATE. MIMCO'S TELEGRAPHIC BID STATED "OFFER WILL BE CONFIRMED
BY TWO EXECUTED COPIES OF THE SOLICITATION." HOWEVER, DCSC REPORTS THAT
IT RECEIVED MIMCO'S MAILED EXECUTED COPY OF THE IFB AFTER THE BID
OPENING DATE AND, THEREFORE, REFUSED TO CONSIDER THE EXECUTED COPY IN
DETERMINING MIMCO'S RESPONSIVENESS. THE CONTRACTING OFFICER
SUBSEQUENTLY REJECTED MIMCO'S TELEGRAPHIC BID AS NONRESPONSIVE BECAUSE
IT FAILED TO COMPLY WITH DEFENSE ACQUISITION CIRCULAR (DAC) NO. 76-26,
DECEMBER 15, 1980), AS INCORPORATED IN THE IFB BY PROVISION LO2. DAR
SEC. 7-2003.29 STATES THAT A TELEGRAPHIC BID SHOULD INCLUDE A STATEMENT
INDICATING THAT THE BIDDER "AGREES TO ALL THE TERMS, CONDITIONS AND
PROVISIONS OF THE INVITATION." MIMCO'S TELEGRAPHIC BID CONTAINED NO SUCH
STATEMENT.
MIMCO CONTENDS THAT DCSC ACTED ARBITRARILY AND CAPRICIOUSLY IN
REJECTING ITS BID AS NONRESPONSIVE.
WE HAVE HELD THAT WHERE A SOLICITATION REQUIRES THAT A TELEGRAPHIC
BID SHOULD INDICATE THAT A BIDDER IS BIDDING "SUBJECT TO ALL THE TERMS,
CONDITIONS, AND PROVISIONS" OF THE SOLICITATION AND THE BIDDER FAILS TO
DO SO, THE BID IS NONRESPONSIVE. CANADIAN COMMERCIAL CORPORATION,
B-185816, JUNE 21, 1976, 76-1 CPD 396. ACCORDINGLY, SINCE MIMCO DID NOT
COMPLY WITH DAR SEC. 7-2003.29 AS INCORPORATED IN THE IFB, DCSC PROPERLY
DETERMINED THAT MIMCO'S BID WAS NONRESPONSIVE IN THAT RESPECT.
CONSEQUENTLY, THE ONLY MANNER IN WHICH THE MIMCO BID COULD BE
ACCEPTED WOULD BE IF IT WERE POSSIBLE TO PERMIT THE EXECUTED COPY OF
MIMCO'S BID TO CURE THE DEFECT IN THE TELEGRAPHIC BID. MIMCO CLAIMS
THAT IT MAILED THE EXECUTED COPY OF THE IFB PRIOR TO THE TELEGRAPHIC BID
AND THAT DCSC DID OR SHOULD HAVE RECEIVED THE EXECUTED COPY BY THE BID
OPENING DATE. UNDER DAR SEC. 7-2002.2 (DAC NO. 76-18, MARCH 12, 1979),
A LATE BID MAY BE ACCEPTED IF EITHER IT IS SENT BY REGISTERED OR
CERTIFIED MAIL NOT LATER THAN 5 DAYS PRIOR TO THE BID OPENING DATE OR IT
WAS SENT BY MAIL AND THE LATE RECEIPT WAS DUE SOLELY TO MISHANDLING BY
THE GOVERNMENT AFTER RECEIPT AT THE GOVERNMENT INSTALLATION. SINCE
MIMCO PRESENTS NO EVIDENCE THAT EITHER EXCEPTION APPLIES HERE, WE
CONCLUDE THAT DCSC PROPERLY REJECTED MIMCO'S EXECUTED COPY OF THE IFB AS
LATE.
WE DENY THE PROTEST.
MIMCO ALSO CLAIMS ITS LOSS OF PROFIT, LEGAL EXPENSES, COSTS INCURRED
IN OBTAINING AND RETAINING ADDITIONAL EQUIPMENT IN PREPARATION FOR THE
AWARD, AND ITS BID PREPARATION COSTS. WE HAVE HELD THAT THERE IS NO
LEGAL BASIS FOR ALLOWING A PROTESTER TO RECOVER ANTICIPATED PROFITS OR
LEGAL FEES INCURRED IN PURSUING A BID PROTEST. M.L. MCKAY & ASSOCIATES,
INC., B-208827, JUNE 1, 1983, 83-1 CPD 587. WE KNOW OF NO BASIS ON
WHICH MIMCO MAY RECOVER ITS COSTS INCURRED IN OBTAINING AND RETAINING
ADDITIONAL EQUIPMENT IN PREPARATION FOR THE AWARD. BID PREPARATION
COSTS CAN ONLY BE RECOVERED IF THE GOVERNMENT HAS ACTED ARBITRARILY OR
CAPRICIOUSLY IN REJECTING A BID. HOLMES & NARVER SERVICES, INC.,
B-208652, JUNE 6, 1983, 83-1 CPD 605. IN VIEW OF OUR CONCLUSIONS ABOVE,
THE CLAIM IS DENIED.
B-210642, B-210642.2, B-211730, MAR 6, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
1. DECISION TO CANCEL SOLICITATION AND
THEREAFTER SET ASIDE PORTION OF PROCUREMENT FOR SMALL BUSINESS IS
UPHELD WHERE AGENCY HAS SHOWN THAT SET-ASIDE DETERMINATION WAS
REASONABLE.
2. SINCE AGENCY DECISION TO CANCEL SOLICITATION
HAD REASONABLE BASIS, PROTEST CONCERNING SELECTION AND APPLICATION
OF TRANSPORTATION RATES UTILIZED IN EVALUATION OF BIDS UNDER THAT
SOLICITATION IS ACADEMIC AND WILL NOT BE CONSIDERED.
3. PROTEST ALLEGING THAT SOLICITATIONS ARE
UNLAWFUL BECAUSE THEY INDEPENDENTLY COMMIT AGENCY TO PURCHASE ITS
TOTAL REQUIREMENTS FOR ONE-CENT BLANKS FROM SEPARATE SOURCES IS
DENIED WHERE REVIEW OF SOLICITATIONS INDICATES THAT AGENCY HAS
MERELY SET ASIDE A FIXED AMOUNT OF ITS YEARLY REQUIREMENT FOR
SMALL BUSINESS AND THAT ANY REQUIREMENTS IN EXCESS OF THAT AMOUNT
WOULD BE PURCHASED FROM FIRM AWARDED REQUIREMENTS-TYPE CONTRACT
UNDER SECOND SOLICITATION.
4. PROTEST ALLEGING THAT SOLICITATION
PROVISIONS ARE AMBIGUOUS, CONTRADICTORY AND UNDULY RESTRICTIVE IS
DENIED WHERE REVIEW OF PROVISIONS IN QUESTION INDICATES THAT THEY
ARE NOT AMBIGUOUS, CONTRADICTORY OR UNDULY RESTRICTIVE.
WILKINSON MANUFACTURING COMPANY:
WILKINSON MANUFACTURING COMPANY (WILKINSON) HAS FILED SEVERAL
PROTESTS IN REGARD TO THE DEPARTMENT OF THE TREASURY, BUREAU OF THE MINT
(MINT), PROCUREMENT OF ITS ANNUAL REQUIREMENTS FOR COPPER-PLATED, ZINC
ONE-CENT BLANKS. THE MINT ISSUED THREE INVITATIONS FOR BIDS (IFB)
NUMBERED BM83-06, BM83-17 AND BM83-18.
WE DENY WILKINSON'S PROTESTS IN PART AND DISMISS THEM IN PART.
WILKINSON'S FIRST PROTEST CONCERNED THE AWARD OF A CONTRACT TO
LASALLE ROLLING MILLS, INC. (LASALLE), PURSUANT TO IFB-06. IT WAS
WILKINSON'S ARGUMENT THAT LASALLE'S BID WAS NONRESPONSIVE. IFB-06
SOLICITED BIDS FOR THE PROCESSING, FABRICATION AND DELIVERY OF ONE-CENT
BLANKS FOR THE MINTS IN PHILADELPHIA AND DENVER (ESTIMATED QUANTITY -
33.5 MILLION POUNDS FOR EACH MINT). SECTION I PROVIDED THAT THE F.O.B.
SHALL BE AT ORIGIN. LASALLE SUBMITTED A BID FOR A TOTAL OF 20 MILLION
POUNDS TO BE DELIVERED TO PHILADELPHIA AND/OR DENVER IN AN AMOUNT
SPECIFIED BY THE MINT.
SUBSEQUENTLY, THE MINT CANCELED IFB-06 AND ISSUED TWO OTHER IFB'S
(IFB-17 AND IFB-18). WILKINSON PROTESTED THE CANCELLATION (B-210642.2)
AND THE MINT'S SELECTION AND APPLICATION OF THE TRANSPORTATION RATES
UTILIZED IN THE EVALUATION OF BIDS UNDER IFB-06 (B-210642).
IFB-17, A TOTAL SMALL BUSINESS SET-ASIDE, SOLICITED BIDS FOR THE
PROCESSING, FABRICATION AND DELIVERY OF ONE-CENT BLANKS FOR THE DENVER
MINT AND WEST POINT BULLION DEPOSITORY (ESTIMATED QUANTITY - 15 MILLION
POUNDS FOR EACH FACILITY). IFB-18, AN UNRESTRICTED SOLICITATION, ALSO
SOLICITED FOR THE PROCESSING, FABRICATION AND DELIVERY OF ONE-CENT
BLANKS FOR THE DENVER AND PHILADELPHIA MINTS (ESTIMATED QUANTITY - 51.85
MILLION POUNDS: 18.425 MILLION - DENVER; 33.425 MILLION -
PHILADELPHIA). SECTION I OF EACH OF THE LATTER IFB'S PROVIDED THAT F.
O.B. SHALL BE AT DESTINATION. WILKINSON PROTESTED IFB'S-17 AND -18,
QUESTIONING THE ISSUANCE OF TWO REQUIREMENTS-TYPE SOLICITATIONS THAT
SPLIT THE NEEDS OF THE DENVER MINT AND CONTENDS THAT THE IFB'S ARE
UNDULY RESTRICTIVE (B-211730).
WE DENY WILKINSON'S PROTEST CONCERNING THE CANCELLATION OF IFB-06
AND, THEREFORE, DISMISS THE PROTEST AGAINST THE TRANSPORTATION RATES AS
ACADEMIC. WILKINSON'S PROTEST INVOLVING IFB'S-17 AND -18 IS DENIED.
IT IS THE MINT'S POSITION THAT THE CANCELLATION OF IFB-06 WAS PROPER.
ESSENTIALLY, THE MINT SUBMITS THAT THE IFB WAS DEFECTIVE. THE MINT
BASES ITS OPINION ON THE FACT THAT THE IFB DID NOT CONTAIN A PROCEDURE
FOR ORDERS UNDER THE SITUATION WHERE MULTIPLE AWARDS WERE ISSUED.
FURTHERMORE, THE MINT POINTS TO THE OMISSION OF A DELIVERY SCHEDULE IN
REGARD TO THE AMOUNTS REQUIRED UNDER THE MULTIPLE-AWARD SITUATION.
MOREOVER, THE RECORD INDICATES THAT AT THE TIME OF THE ISSUANCE OF
IFB-06, THE MINT WAS CONSIDERING A SMALL BUSINESS SET-ASIDE, BUT WAS
UNABLE TO COMPLETE ITS EVALUATION CONCERNING THE MINTS INVOLVED AND THE
AMOUNT PRIOR TO BID OPENING. AT THIS TIME, TWO FACILITIES BESIDE DENVER
AND PHILADELPHIA, WEST POINT BULLION DEPOSITORY AND SAN FRANCISCO ASSAY
OFFICE, WERE PRODUCING THE ONE-CENT COIN. HOWEVER, THIS CHANGED WHEN IT
WAS DETERMINED THAT THE SAN FRANCISCO FACILITY WAS NEEDED FOR THE
PRODUCTION OF OLYMPIC AND GEORGE WASHINGTON COMMEMORATIVE COINS. WITH
ONLY THREE FACILITIES REMAINING TO PRODUCE THE ONE-CENT COINS, THE
ANNUAL REQUIREMENTS WERE THEN REEVALUATED AND IT WAS DISCOVERED THAT
THERE WAS A DECLINE IN THE FEDERAL RESERVE BANKS' DEMAND FOR ONE-CENT
COINS. CONCOMITANTLY, THE SMALL BUSINESS SET-ASIDE DECISION WAS MADE -
20 MILLION POUNDS WOULD BE SET ASIDE (10 MILLION EACH FOR WEST POINT AND
DENVER). SUBSEQUENT TO THE ISSUANCE OF IFB-17 AND IFB-18, THE SET-ASIDE
AMOUNT WAS INCREASED TO 30 MILLION POUNDS (15 MILLION EACH FOR WEST
POINT AND DENVER). WE ALSO NOTE THAT THE BIDS UNDER THE NEW
SOLICITATIONS WERE BASED ON F.O. B. DESTINATION RATHER THAN ORIGIN.
WILKINSON CONTENDS THAT THE MINT'S ARGUMENTS NEITHER INDIVIDUALLY NOR
COLLECTIVELY SUPPORT THE CANCELLATION OF IFB-06. HOWEVER, WE NEED NOT
DISCUSS EACH OF WILKINSON'S OBJECTIONS SINCE WE FIND THAT THE MINT'S
DECISION TO SET ASIDE PART OF THE PROCUREMENT WAS NOT UNREASONABLE AND,
THEREFORE, AN ADEQUATE JUSTIFICATION, STANDING ALONE, TO SUPPORT
CANCELLATION OF A SOLICITATION.
IN LIGHT OF THE MANDATE OF THE SMALL BUSINESS ACT, 15 U.S.C. SEC.
637 ET SEQ. (1982), THAT A FAIR PROPORTION OF PROCUREMENT CONTRACTS BE
PLACED WITH SMALL BUSINESS AND THE ABSENCE OF ANY REQUIREMENT, STATUTORY
OR REGULATORY, THAT A SET-ASIDE BE MADE AT ANY PARTICULAR TIME, SEE
FEDERAL PROCUREMENT REGULATIONS (FPR) SEC. 1-706.5 (1964 ED. AMEND
192), A SET-ASIDE DETERMINATION IS PERMISSIBLE AFTER SOLICITATION
ISSUANCE IF THERE IS A REASONABLE BASIS FOR THE DETERMINATION AT THE
TIME IT IS MADE. SEE AMERICAN DREDGING COMPANY, B-201687, MAY 5, 1981,
81-1 CPD 344.
THE DETERMINATION, PURSUANT TO FPR SEC. 1-706.5, REQUIRES A
REASONABLE EXPECTATION THAT BIDS WILL BE RECEIVED FROM A SUFFICIENT
NUMBER OF RESPONSIBLE SMALL BUSINESS CONCERNS SO THAT AWARD WILL BE MADE
AT A REASONABLE PRICE. SINCE THIS TYPE OF DETERMINATION IS BASICALLY A
BUSINESS JUDGMENT, WE WILL SUSTAIN THE DETERMINATION ABSENT A CLEAR
SHOWING OF ABUSE OF DISCRETION. OTIS ELEVATOR COMPANY, B-196540, MAY 6,
1980, 80-1 CPD 327.
WE FIND THAT THE RECORD ADEQUATELY SUPPORTS THE SET-ASIDE DECISION.
THE MINT ADVISES THAT IFB-06 WAS NOT SET ASIDE FOR SMALL BUSINESS
BECAUSE THE MINT WAS UNABLE TO COMPLETE ITS EVALUATION CONCERNING WHICH
MINTS WOULD BE INVOLVED AND THE AMOUNT OF THE PROCUREMENT. AFTER IFB-06
WAS CANCELED, THE MINT CONCLUDED ITS SET-ASIDE EVALUATION AND DETERMINED
THAT A PORTION OF THE PROCUREMENT FOR DENVER AND ALL OF WEST POINT'S
REQUIREMENTS COULD BE SET ASIDE AND THAT THERE WAS A REASONABLE
EXPECTATION OF RECEIPT OF BIDS FROM SMALL BUSINESS. FIVE SMALL
BUSINESSES RESPONDED TO THE SET-ASIDE (IFB-17); HOWEVER, TWO SUBMITTED
A "NO BID." NONETHELESS, ADEQUATE COMPETITION WAS ACHIEVED AND,
THEREFORE, WE DO NOT FIND THE MINT'S DECISION TO SET ASIDE TO HAVE BEEN
UNREASONABLE. SEE AMERICAN DREDGING COMPANY, SUPRA. THUS, IFB-06 NEED
NOT BE REINSTATED.
WILKINSON'S FINAL PROTEST CONCERNS THE ISSUANCE OF IFB'S-17 AND -18
TO SATISFY THE MINT'S TOTAL YEARLY REQUIREMENTS FOR ONE-CENT BLANKS.
IFB-17 WAS SET ASIDE EXCLUSIVELY FOR SMALL BUSINESS WHILE IFB-18 WAS
ISSUED ON AN UNRESTRICTED BASIS. WILKINSON ARGUES THAT THE IFB'S ARE
UNLAWFUL AND CONTRADICTORY SINCE THEY APPARENTLY COMMIT THE MINT TO
PURCHASE ALL OF THE DENVER FACILITY REQUIREMENTS FOR ONE-CENT BLANKS
FROM MORE THAN ONE SOURCE. AS A RESULT, WILKINSON CONTENDS THAT THE
MINT WOULD BE OBLIGATED TO PURCHASE TWICE ITS ACTUAL REQUIREMENTS FOR
THE DENVER FACILITY AND THAT SUCH A RESULT IS CLEARLY IN EXCESS OF THE
GOVERNMENT'S NEEDS. ALSO, WILKINSON ARGUES THAT BOTH IFB'S ARE
AMBIGUOUS AND UNDULY RESTRICTIVE OF COMPETITION.
A NECESSARY ELEMENT OF ANY REQUIREMENTS CONTRACT IS THAT ONE PARTY
AGREES TO OBTAIN THE REQUIRED GOODS AND SERVICES FROM ONE PARTY
EXCLUSIVELY. SEE E.G. SHADEN CONTRACTORS, INC. V. UNITED STATES, 149
CT.CL. 535, 276 F.2D 1 (1960). IN THE PRESENT CASE, THE MINT HAS SET
ASIDE A PORTION OF ITS TOTAL REQUIREMENTS FOR THE DENVER FACILITY FOR
SMALL BUSINESS AND, IN OUR VIEW, THE SUBJECT CONTRACTS ARE NOT
"REQUIREMENTS" CONTRACTS SINCE THE MINT HAS NOT AGREED TO PROCURE ALL OF
ITS REQUIREMENTS EXCLUSIVELY FROM ONE SOURCE. HOWEVER, SINCE BOTH IFB'S
RELATE TO THE SAME REQUIREMENT AND WERE ISSUED SIMULTANEOUSLY WITH THE
EXACT SAME CLOSING DATE, THE PROPRIETY OF THIS PROCUREMENT ACTION MUST
BE BASED ON AN EVALUATION OF BOTH IFB'S EVEN THOUGH THE AWARD OF TWO
SEPARATE CONTRACTS IS CONTEMPLATED.
OUR REVIEW OF THE IFB'S CLEARLY INDICATES THAT THE MINT IS NOT
PURCHASING TWICE ITS ACTUAL REQUIREMENTS. THE MINT HAS MERELY SET ASIDE
A PORTION OF ITS TOTAL REQUIREMENTS FOR SMALL BUSINESS AND WE FIND
NOTHING IMPROPER IN THIS DECISION. IN ADDITION, WE BELIEVE THE
OBLIGATIONS AND BENEFITS OF ALL PARTIES, UNDER BOTH IFB'S-17 AND -18,
WERE ADEQUATELY DEFINED IN THE SOLICITATIONS. ALTHOUGH WILKINSON ARGUES
THAT THERE IS AN APPARENT CONFLICT BETWEEN THE TWO IFB'S AS TO THE
ESTIMATED QUANTITY SET ASIDE UNDER IFB-17, SUBSEQUENT AMENDMENTS TO BOTH
IFB'S-17 AND -18 CLEARLY DEMONSTRATE THAT 15 MILLION POUNDS WERE, IN
FACT, THE AMOUNT SET ASIDE FOR THE DENVER FACILITY UNDER IFB-17. THE
OVERALL ESTIMATE FOR THE DENVER FACILITY WAS 33,425,000 POUNDS AND
ORIGINALLY 20 MILLION POUNDS WERE TO BE PURCHASED UNDER THE SET-ASIDE
WITH THE REMAINDER, IF ANY, TO BE PURCHASED UNDER IFB-18. ON JUNE 17,
1983, THE MINT REVISED THE ESTIMATE FOR THE DENVER FACILITY UNDER IFB-17
TO 15 MILLION POUNDS AND, SUBSEQUENTLY, ON JUNE 21, THE ESTIMATE IN
IFB-18 WAS REVISED TO 18,425,000 POUNDS. EVEN THOUGH PARAGRAPH C. 20.D
OF IFB-18 WAS NOT FORMALLY AMENDED TO REFLECT THE REVISED ESTIMATE, IT
APPEARS CLEAR THAT THE INITIAL 15 MILLION POUNDS OF DENVER'S
REQUIREMENTS WOULD BE PURCHASED UNDER IFB-17 AND THAT ANY REQUIREMENTS
IN EXCESS OF THAT ESTIMATE WOULD BE FILLED BY THE FIRM AWARDED THE
CONTRACT UNDER IFB-18. ACCORDINGLY, WE DO NOT FIND THE IFB'S TO BE
EITHER UNLAWFUL OR AMBIGUOUS.
WILKINSON ALSO ARGUES THAT BOTH IFB'S ARE UNDULY RESTRICTIVE AND WERE
CONSTRUCTED BY THE MINT TO SPECIFICALLY ACCOMMODATE THE INCUMBENT
CONTRACTORS. WILKINSON CONTENDS THAT THE 20-MILLION POUND ESTIMATE FOR
THE SMALL BUSINESS SET-ASIDE REFLECTS LASALLE'S AVAILABLE PRODUCTION
CAPACITY AND THAT NO OTHER PRODUCER COULD AFFORD TO PRODUCE SUCH A SMALL
QUANTITY AND EFFECTIVELY COMPETE. IN ADDITION, WILKINSON ARGUES THAT THE
FIRST ARTICLE REQUIREMENT IN IFB-18 PRECLUDES ANY PRODUCER THAT HAS NOT
PREVIOUSLY SUPPLIED THE MINT FROM COMPETING AND, IN EFFECT, CREATES A
SOLE-SOURCE PROCUREMENT.
WITH RESPECT TO WILKINSON'S ALLEGATION THAT THE 20-MILLION POUND
QUANTITY SET-ASIDE UNDER IFB-17 RESTRICTED THE PROCUREMENT TO LASALLE,
WE NOTE THAT, SUBSEQUENT TO THE PROTEST, THE QUANTITY WAS REVISED TO 30
MILLION POUNDS AND THREE SMALL BUSINESSES ACTUALLY BID ON THE IFB.
WILKINSON ALSO CONTENDED THAT THE FIRST ARTICLE REQUIREMENT IN IFB-18
DID NOT PROVIDE SUFFICIENT TIME FOR BIDDERS TO DELIVER FIRST ARTICLE
SAMPLES. ALTHOUGH THE IFB WAS AMENDED TO GIVE BIDDERS 255 DAYS AFTER
THE AWARD OF THE CONTRACT TO DELIVER THE FIRST ARTICLES, WILKINSON
ARGUED THAT THE PERIOD OF PERFORMANCE REQUIRED DELIVERIES TO BEGIN THE
WEEK OF OCTOBER 3, 1983, AND THAT ONLY ONE FIRM COULD MEET THIS
SCHEDULE. HOWEVER, AMENDMENT 6, PARAGRAPH 3, RESOLVED WILKINSON'S
CONCERN. THAT PARAGRAPH DELETED THE OCTOBER 3 DATE AND PROVIDED FOR
PERFORMANCE TO BEGIN WITHIN 30 DAYS AFTER THE ISSUANCE OF A DELIVERY
ORDER.
FINALLY, WILKINSON CONTENDS THAT IFB-17 IS AMBIGUOUS AS TO WHETHER
SINGLE OR MULTIPLE AWARDS WILL BE MADE. PARAGRAPH D.3 PROVIDES THAT
BIDS WILL BE EVALUATED ON AN ALL-OR-NONE BASIS. PARAGRAPH D.1 PROVIDES
THAT A BID WILL BE FOUND NONRESPONSIVE IF IT OFFERS A QUANTITY LESS THAN
THE QUANTITIES SHOWN IN THE SCHEDULE FOR ITEM E.1 OR E.2. WILKINSON
ARGUES THAT IT IS NOT CLEAR WHETHER THE ALL-OR-NONE PROVISION APPLIES TO
EACH LINE ITEM, PERMITTING A BIDDER TO BID "ALL" FOR ONE ITEM AND "NONE"
FOR THE OTHER, OR TO THE TOTAL CONTRACT.
PARAGRAPH C.33 OF IFB-17 CLEARLY STATES THAT MULTIPLE AWARDS WILL NOT
RESULT FROM THIS SOLICITATION. AS A RESULT, IT IS CLEAR THAT THE
ALL-OR-NONE PROVISION APPLIES TO THE TOTAL CONTRACT AND THAT BIDDERS, IN
ORDER TO BE CONSIDERED FOR AWARD, MUST BID EACH LINE ITEM.
B-210640, FEB 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO DOES NOT REVIEW AFFIRMATIVE RESPONSIBILITY DETERMINATION EXCEPT
IN LIMITED CIRCUMSTANCES.
LINE FAST CORPORATION:
LINE FAST CORPORATION PROTESTS AGAINST AN AWARD OF A CONTRACT TO
TRI-MARINE INDUSTRIES, INC. (TMI), UNDER SOLICITATION NO.
N00024-83-PR-22615 ISSUED BY THE NAVAL SEA SYSTEMS COMMAND ON THE
GROUNDS THAT TMI LACKS RESPONSIBILITY BECAUSE IT DOES NOT HAVE THE
FACILITIES AND FINANCIAL CAPABILITY TO COMPLETE THE CONTRACT.
OUR OFFICE DOES NOT REVIEW A PROTEST AGAINST A CONTRACTING OFFICER'S
AFFIRMATIVE DETERMINATION OF RESPONSIBILITY ABSENT A SHOWING THAT THE
CONTRACTING OFFICER ACTED FRAUDULENTLY OR IN BAD FAITH OR THAT
DEFINITIVE RESPONSIBILITY CRITERIA IN THE SOLICITATION HAVE NOT BEEN
MET. J&R CLEANING AND GENERAL MAINTENANCE, B-206280, FEBRUARY 19, 1982,
82-1 CPD 147. NEITHER EXCEPTION APPLIES HERE.
WE DISMISS THE PROTEST.
B-210638, FEB 8, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
1. A LIENHOLDER IS NOT A PROPER PARTY UNDER
10 U.S.C. SEC. 2575 (1982) AND IS NOT ENTITLED UNDER THAT STATUTE
TO PROCEEDS COLLECTED FROM THE ARMY'S SALE OF UNCLAIMED VEHICLE
EVEN THOUGH THE VEHICLE SHOULD NOT HAVE BEEN SOLD WHEN STILL
SUBJECT TO A LIEN.
2. WHERE ARMY ERRONEOUSLY SOLD VEHICLE SUBJECT
TO CLAIMANT'S LIEN AND DEPOSITED PROCEEDS IN TREASURY, CLAIMANT
MAY BE PAID IN SATISFACTION OF ITS SECURED INTEREST FROM
APPROPRIATION FOR MONEYS ERRONEOUSLY RECEIVED AND COVERED INTO THE
TREASURY, 31 U.S.C. SEC. 1322(B)(2), AS THERE IS NO OTHER SPECIFIC
APPROPRIATION OR ACCOUNT AVAILABLE FOR THIS PURPOSE.
DEPARTMENT OF ARMY - LIENHOLDER CLAIM UNDER MILITARY CLAIMS ACT:
THE CHIEF OF THE GENERAL CLAIMS BRANCH, EUROPE, APO NEW YORK, HAS
REFERRED TO OUR OFFICE A CLAIM OF THE FORT MONMOUTH FEDERAL CREDIT UNION
UNDER 10 U.S.C. SEC. 2575 (1982) AND DOD REGULATION 4160.21-M. THE
CLAIM CONCERNS THE ARMY'S DISPOSAL AT PUBLIC AUCTION OF A CAR BELONGING
TO A NONCOMMISSIONED OFFICER IN WHICH THE CLAIMANT HAD A SECURITY
INTEREST. SINCE THE ARMY SHOULD NOT HAVE SOLD THE CAR PRIOR TO THE
CLAIMANT SIGNING A RELEASE FORM, THE MONEY COLLECTED FROM THE SALE WAS
ERRONEOUSLY RECEIVED AND COVERED INTO THE TREASURY AS A MISCELLANEOUS
RECEIPT AND MAY BE REFUNDED FROM THE PERMANENT APPROPRIATION FOR MONEYS
SO RECEIVED. 31 U.S.C. SEC. 1322(B)(2). THE CLAIMANT IS NOT A PROPER
PARTY UNDER 10 U.S.C. SEC. 2575 AND THEREFORE IS NOT ENTITLED TO THE
PROCEEDS OF THE SALE UNDER THAT PROVISION.
ACCORDING TO THE MATERIAL SUBMITTED WITH THIS CASE, IN 1979 UNDER
MILITARY ORDERS THE NON-COMMISSIONED OFFICER SHIPPED HIS AUTOMOBILE TO
BREMERHAVEN, GERMANY, FROM BAYONNE, NEW JERSEY. THE AUTOMOBILE ARRIVED
IN BREMERHAVEN AND WAS KEPT IN AN ARMY TERMINAL. FREQUENT ATTEMPTS TO
CONTACT THE OWNER WERE UNSUCCESSFUL. ON DECEMBER 8, 1980, THE
AUTOMOBILE WAS SOLD AT PUBLIC AUCTION FOR $2,400 AND THIS AMOUNT WAS
DEPOSITED IN THE TREASURY AS A MISCELLANEOUS RECEIPT. PRIOR TO THIS
SALE THE ARMY DID NOT CONDUCT A TITLE SEARCH ON THE AUTOMOBILE AS
REQUIRED BY ITS DISPOSAL REGULATIONS. IF IT HAD, IT WOULD HAVE FOUND
THAT THE FORT MONMOUTH FEDERAL CREDIT UNION HELD A $4,093 LIEN ON THE
AUTOMOBILE. ON FEBRUARY 8, 1982, THE CREDIT UNION FILED A CLAIM FOR
$2,400.
THE ARMY RECOMMENDS PAYMENT OF THE CLAIM INASMUCH AS IT BELIEVES THAT
ITS REGULATIONS GOVERNING THE DISPOSITION OF UNCLAIMED PROPERTY WERE NOT
COMPLIED WITH.
SPECIAL PROVISION IS MADE IN THE REGULATIONS FOR SITUATIONS IN WHICH
THE PROPERTY IS SUBJECT TO A LIEN. UNDER THESE REGULATIONS, PROPERTY
SUCH AS AN AUTOMOBILE SUBJECT TO A LIEN PLACED ON IT BY THE INSTITUTION
THAT LOANED MONEY FOR PURCHASE OF THE AUTOMOBILE MAY NOT BE SOLD UNLESS
THE RELEASE OF THE LIEN IS OBTAINED. DOD 4160.21-M, PARAGRAPH 56B(1)(
C). ADDITIONALLY, DOD 4160.21-M, PARAGRAPH 56C(2) PROVIDES THAT A
VEHICLE WITH A LIEN SHOULD NOT BE TURNED IN UNLESS RELEASE OF THE LIEN
PURSUANT TO SUBPARAGRAPH B(2)(C) HAS BEEN OBTAINED.
IN THE CASE BEFORE US, A TITLE SEARCH WOULD HAVE REVEALED THE
CLAIMANT AS A LIENHOLDER; HOWEVER, THIS WAS NOT DONE. CONSEQUENTLY, NO
EFFORT TO OBTAIN A RELEASE WAS MADE BY THE BOARD OF OFFICERS, AS
REQUIRED BY PARAGRAPH 56B(2), BEFORE THE CAR WAS TURNED OVER TO THE
DEFENSE PROPERTY DISPOSAL OFFICE FOR SALE. BECAUSE OF THE FAILURE TO
ASCERTAIN AND NOTIFY THE CLAIMANT, THE ARMY'S OFFICE OF STAFF JUDGE
ADVOCATE BELIEVES THAT THE BOARD OF OFFICERS' ACTIONS CAUSED THE
CLAIMANT TO LOSE FUNDS THAT IT WAS ENTITLED TO AND THEY RECOMMEND
PAYMENT OF THE CLAIM.
THE ARMY COMES TO US BASED ON THE ABOVE CITED REGULATIONS THAT
IMPLEMENT 10 U.S.C. SEC. 2575 AUTHORIZING THE SECRETARY OF ANY MILITARY
DEPARTMENT TO DISPOSE OF LOST, ABANDONED, OR UNCLAIMED PERSONAL
PROPERTY. IN RELEVANT PART, SUBSECTION (B) OF THIS SECTION STATES THAT:
"THE NET PROCEEDS FROM THE SALE OF PROPERTY
UNDER THIS SECTION SHALL BE COVERED INTO THE
TREASURY AS MISCELLANEOUS RECEIPTS. THE
OWNER, HIS HEIRS OR NEXT OF KIN, OR HIS LEGAL
REPRESENTATIVE MAY FILE A CLAIM FOR THESE
PROCEEDS WITH THE GENERAL ACCOUNTING OFFICE
WITHIN FIVE YEARS AFTER THE DATE OF THE DISPOSAL
OF THE PROPERTY."
DOD REGULATION 4160.21-M PARA. 56E REQUIRES:
"ANY CLAIMS FOR PROCEEDS RECEIVED FROM THE
SALE OF PERSONAL PROPERTY ... WILL BE
REFERRED TO THE GAO. ..."
THE AUTHORITY OF THIS OFFICE TO CONSIDER CLAIMS UNDER 10 U.S.C. SEC.
2575(B) IS LIMITED TO THOSE TIMELY CLAIMS MADE BY SPECIFIED CLAIMANTS TO
THE NET PROCEEDS DERIVED FROM THE SALE OF UNCLAIMED PROPERTY. ALTHOUGH
THE LIENHOLDER MAY HAVE HAD A POSSESSORY INTEREST IN THE CAR, IT IS NOT
WITHIN THE ENUMERATED CLASSES PROTECTED BY THE STATUTE. ID. THEREFORE,
WE CANNOT AUTHORIZE THE PAYMENT OF THE CREDIT UNION'S CLAIM UNDER THIS
SECTION.
HOWEVER, SINCE UNDER DOD REGULATIONS THE CAR SHOULD NOT HAVE BEEN
SOLD BY THE ARMY WITHOUT FIRST NOTIFYING AND OBTAINING A RELEASE FROM
THE CREDIT UNION, WE BELIEVE THE ARMY MUST BE CONSIDERED TO HAVE
RECEIVED THE PROCEEDS FOR THE BENEFIT OF THE LIENHOLDER. IN SUCH A
SITUATION, WE BELIEVE IT PROPER TO TURN THE PROCEEDS OVER TO THE
LIENHOLDER. SEE 60 COMP.GEN. 15 (1980). THE FACT THAT THE PROCEEDS
WERE MISTAKENLY DEPOSITED IN THE TREASURY AS A MISCELLANEOUS RECEIPT
UNDER 31 U.S.C. SEC. 3302(B) DOES NOT STAND IN THE WAY OF THE ARMY
CORRECTING ITS EARLIER MISTAKE. THE PERMANENT APPROPRIATION CREATED BY
31 U.S.C. SEC. 1322(B)(2) ENTITLED "REFUND OF MONEYS ERRONEOUSLY
RECEIVED AND COVERED" MAY BE USED TO PAY THE CREDIT UNION WHAT IT IS
OWED. SEE 61 COMP.GEN. 224 (1982).
IN THE EVENT THAT THE OWNER OF THE CAR SUBSEQUENTLY FILES A CLAIM FOR
THE PROCEEDS FOR THE CAR UNDER 10 U.S.C. SEC. 2575, HE WOULD BE ENTITLED
ONLY TO THE AMOUNT REMAINING AFTER THE ARMY'S COSTS AND THE AMOUNT OWED
THE LIENHOLDER ARE DEDUCTED. HERE, NO PROCEEDS WOULD REMAIN.
B-210625, MAY 6, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST THAT AGENCY IMPROPERLY WAIVED REQUIREMENTS OF QUALIFIED
PRODUCTS LIST (QPL) IN A SOLICITATION IS UNTIMELY SINCE IT WAS NOT FILED
PRIOR TO BID OPENING.
2. PROTEST FILED MORE THAN 10 WORKING DAYS AFTER BASIS FOR PROTEST
IS KNOWN IS UNTIMELY AND WILL NOT BE CONSIDERED.
CHEMRAY COATINGS CORPORATION:
CHEMRAY COATINGS CORPORATION PROTESTS THE AWARD OF A REQUIREMENTS
CONTRACT FOR VARIOUS ITEMS UNDER INVITATION FOR BIDS (IFB) NO.
10PR-XKS-5376, ISSUED BY THE GENERAL SERVICES ADMINISTRATION (GSA).
THE IFB REQUESTED BIDS FOR VARIOUS TYPES OF INTERIOR AND EXTERIOR
PAINT AND REQUIRED THAT ALL PAINT OFFERED BE QUALIFIED PRODUCTS.
CHEMRAY IS LISTED AS A "COMPOSITION L" SUPPLIER UNDER THE APPROPRIATE
QUALIFIED PRODUCTS LIST (QPL) WHICH DESIGNATES SUPPLIERS OF PRODUCTS
WHICH COMPLY WITH APPLICABLE AIR POLLUTION STANDARDS. THE SOLICITATION
PERMITTED EITHER "COMPOSITION L" OR "COMPOSITION G" SUPPLIERS TO FURNISH
THE PROTESTED ITEMS, PROVIDED THEY IN FACT SUPPLY "COMPOSITION L"
PRODUCTS. ACCORDING TO CHEMRAY, CURRENT QPL SPECIFICATIONS EXCLUDE
"COMPOSITION G" SUPPLIERS FROM FURNISHING "COMPOSITION L" PRODUCTS
UNLESS THEY ARE ALSO LISTED AS APPROVED SOURCES UNDER "COMPOSITION L" OR
HAVE SUBMITTED SAMPLES FOR APPROPRIATE QUALIFICATION TESTING. CHEMRAY
THEREFORE CONTENDS THAT GSA "IMPROPERLY WAIVED THE QPL REQUIREMENT" BY
NOT LIMITING BIDDING SOLELY TO SUPPLIERS LISTED UNDER "COMPOSITION L."
FOR THE REASONS INDICATED BELOW, WE DISMISS THE PROTEST.
UNDER OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.2 (1983), PROTESTS
BASED UPON ALLEGED IMPROPRIETIES WHICH ARE APPARENT PRIOR TO BID OPENING
MUST BE FILED EITHER WITH THE CONTRACTING AGENCY OR OUR OFFICE PRIOR TO
BID OPENING IN ORDER TO BE CONSIDERED TIMELY FILED. HERE, CHEMRAY WAS
OR SHOULD HAVE BEEN AWARE OF THE ALLEGED WAIVER OF THE QPL REQUIREMENTS
PRIOR TO BID OPENING ON DECEMBER 16, 1982. YET, ITS PROTEST WAS NOT
FILED WITH THE CONTRACTING AGENCY UNTIL JANUARY 5, 1983. THEREFORE,
INSOFAR AS CHEMRAY'S PROTEST CONCERNS THE WAIVER OF THE QPL REQUIREMENTS
IN THIS PARTICULAR SOLICITATION, IT IS UNTIMELY AND WILL NOT BE
CONSIDERED ON THE MERITS.
HOWEVER, CHEMRAY ALSO APPEARS TO BE ARGUING THAT GSA IMPROPERLY
FAILED TO OBTAIN PERMISSION TO WAIVE THE QPL REQUIREMENT FROM THE
APPROPRIATE TECHNICAL ACTIVITY HAVING RESPONSIBILITY FOR THESE ITEMS.
CHEMRAY STATES THAT IT DID NOT LEARN OF THIS IMPROPRIETY UNTIL EITHER 1
DAY BEFORE OR 1 DAY AFTER BID OPENING. HOWEVER, EVEN IF THE PROTESTER
FIRST LEARNED OF THE ALLEGED IMPROPRIETY THE DAY AFTER BID OPENING,
DECEMBER 17, 1982, OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.1(B)(
2), ALSO REQUIRE PROTESTS TO BE FILED NO LATER THAN 10 WORKING DAYS
AFTER THE BASIS OF THE PROTEST IS KNOWN OR SHOULD HAVE BEEN KNOWN,
WHICHEVER IS EARLIER. AS STATED PREVIOUSLY, CHEMRAY'S PROTEST WAS NOT
FILED WITH THE CONTRACTING AGENCY UNTIL JANUARY 5, 1983, OR MORE THAN 10
WORKING DAYS AFTER CHEMRAY KNEW THIS BASIS FOR ITS PROTEST.
THE PROTEST IS DISMISSED.
B-210613, JUN 10, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
EMPLOYEE, NOT COVERED BY COLLECTIVE BARGAINING AGREEMENT, WHO
TRAVELED TO FAA ACADEMY, IS ENTITLED TO USE OF HIS PRIVATELY OWNED
VEHICLE (POV) AS ADVANTAGEOUS TO THE GOVERNMENT, SINCE HE IS IDENTICALLY
SITUATED TO EMPLOYEES WHO ARE SPECIFICALLY COVERED BY A PROVISION OF
COLLECTIVE BARGAINING AGREEMENT PERMITTING USE OF A POV AS ADVANTAGEOUS
TO THE GOVERNMENT IN CERTAIN CIRCUMSTANCES. AGREEMENT REQUIRES
"FREQUENT ASSIGNMENT TO RECURRING TRAINING" AT THE FAA ACADEMY, AND
EMPLOYEE HERE IS SUBJECT TO FREQUENT ASSIGNMENT TO RECURRING TRAINING AT
THE FAA ACADEMY WHERE HIS TRAINING PROGRAM AS A DATA SYSTEMS SPECIALIST
CALLS FOR HIM TO ATTEND FUTURE TRAINING CLASSES AT THE FAA ACADEMY IN
ORDER TO REACH FULL PERFORMANCE LEVEL. THE FAA MAY NOT DISCRIMINATE
BETWEEN IDENTICALLY SITUATED EMPLOYEES.
DANIEL L. REID - POV TRAVEL TO FAA ACADEMY:
THIS ACTION IS A RECONSIDERATION OF SETTLEMENT CERTIFICATE Z-2830702,
SEPTEMBER 23, 1982, ISSUED BY OUR CLAIMS GROUP, DISALLOWING THE CLAIM OF
MR. DANIEL L. REID, AN AIR TRAFFIC DATA SYSTEMS SPECIALIST, FEDERAL
AVIATION ADMINISTRATION (FAA), FOR REIMBURSEMENT OF MILEAGE COSTS FOR
THE USE OF HIS PRIVATELY OWNED VEHICLE (POV) TO TRAVEL TO AND FROM THE
FAA ACADEMY IN OKLAHOMA CITY, OKLAHOMA. IT IS MR. REID'S CONTENTION
THAT HIS USE OF HIS POV SHOULD HAVE BEEN FOUND TO BE ADVANTAGEOUS TO THE
GOVERNMENT. FOR THE REASONS STATED BELOW WE REVERSE THE DECISION OF OUR
CLAIMS GROUP, AND WE HOLD THAT MR. REID IS ENTITLED TO FULL
REIMBURSEMENT OF HIS MILEAGE COSTS FOR TRAVEL BY POV TO AND FROM THE FAA
ACADEMY AS ADVANTAGEOUS TO THE GOVERNMENT.
THE RECORD SHOWS THAT MR. REID WAS ISSUED TRAVEL ORDER S-2103-138,
DATED SEPTEMBER 18, 1980, TO ATTEND TRAINING AT THE FAA ACADEMY IN
OKLAHOMA CITY, OKLAHOMA, FROM OCTOBER 2, 1980, THROUGH NOVEMBER 18,
1980. MR. REID, A DATA SYSTEMS SPECIALIST AT THE SEATTLE, WASHINGTON,
AIR ROUTE TRAFFIC CONTROL CENTER, DROVE HIS POV TO AND FROM THE FAA
ACADEMY AND CLAIMED TOTAL TRAVEL AND SUBSISTENCE EXPENSES OF $2,350.40,
WITH MILEAGE CALCULATED ON THE BASIS OF POV USE BEING ADVANTAGEOUS TO
THE GOVERNMENT. THE FAA DID NOT CONSIDER MR. REID'S USE OF POV AS
ADVANTAGEOUS TO THE GOVERNMENT AND COMPENSATED HIM BASED ON THE
CONSTRUCTIVE COST OF AIR TRAVEL TO AND FROM THE FAA ACADEMY, IN THE
TOTAL AMOUNT FOR TRAVEL AND SUBSISTENCE OF $1,939, OR $411.40 LESS THAN
MR. REID CLAIMED. THE FAA DENIED THE INTERNAL GRIEVANCE FILED BY MR.
REID, SO HE THEN FILED A CLAIM WITH GAO.
MR. REID CLAIMS THAT HE SHOULD BE REIMBURSED HIS POV COSTS BECAUSE HE
IS IN THE SAME SITUATION AS AIRWAY FACILITY EMPLOYEES THAT ARE COVERED
BY THE FEDERAL AVIATION SCIENCE AND TECHNOLOGICAL ASSOCIATION, NATIONAL
ASSOCIATION OF GOVERNMENT EMPLOYEES (FASTA/NAGE)-FAA COLLECTIVE
BARGAINING AGREEMENT. AIRWAY FACILITY EMPLOYEES ARE REIMBURSED FOR POV
MILEAGE COSTS FOR "RECURRING TRAINING" UNDER ARTICLE 19, SECTION 1 OF
THE FASTA/NAGE-FAA AGREEMENT. AS SUPPORT FOR HIS POSITION, MR. REID
RELIES ON OUR DECISIONS IN ARD T. JOHNSON, B-194372, JANUARY 8, 1980,
AND AIR TRAFFIC CONTROL TRAINEES, B-201542, SEPTEMBER 18, 1981.
BOTH OF THOSE DECISIONS INVOLVED ARTICLE 19, SECTION 1 OF THE FASTA/
NAGE-FAA AGREEMENT, WHICH PROVIDES:
"ARTICLE 19 - FAA ACADEMY TRAINING TRAVEL
"SECTION 1. THE PARTIES RECOGNIZE THAT
THE FREQUENT ASSIGNMENT OF AIRWAY FACILITIES
TECHNICIANS TO RECURRING TRAINING AT THE FAA
ACADEMY, LEADING TO QUALIFICATION AND/OR
MAINTENANCE OF QUALIFICATION ON CERTIFIABLE
SYSTEMS AND SUPPORTING SUB-SYSTEMS, CREATES
AN UNUSUAL SITUATION NOT EXPERIENCED BY OTHER
TRAVELERS. IT IS FURTHER RECOGNIZED THAT
ADEQUATE GOVERNMENT OWNED QUARTERS AND
ADEQUATE OFF-HOURS LOCAL TRANSPORTATION ARE
NOT PROVIDED. THE EMPLOYER THEREFORE AGREES
THAT, WHEN SUCH PERSONNEL (IF EMPLOYED IN THE
CONTIGUOUS 48 STATES) ARE ISSUED A TRAVEL
ORDER TO ATTEND THE FAA ACADEMY FOR MORE THAN
THREE CONSECUTIVE WEEKS, SUCH PERSONNEL SHALL
BE AUTHORIZED THE USE OF A PRIVATELY OWNED
VEHICLE. SUCH TRAVEL SHALL BE DEEMED TO BE
ADVANTAGEOUS TO THE GOVERNMENT AND PER DIEM
AND MILEAGE SHALL BE PAID AT THE RATE
APPLICABLE TO SUCH TRAVEL."
IN ARD T. JOHNSON, WE HELD THAT IF AN EMPLOYEE COVERED BY THE FASTA/
NAGE-FAA AGREEMENT, WHO TRAVELS IN A POV TO THE FAA ACADEMY, IS
CONSIDERED TO BE USING HIS POV FOR THE ADVANTAGE OF THE GOVERNMENT, THEN
AN IDENTICALLY SITUATED EMPLOYEE WHO IS NOT COVERED BY THE AGREEMENT
SHOULD ALSO BE CONSIDERED TO BE USING HIS POV FOR THE ADVANTAGE OF THE
GOVERNMENT. WE REASONED IN SUPPORT OF OUR HOLDING:
"*** THE REASON FOR OUR HOLDING IS THAT,
ALTHOUGH THE FAA HAS THE DISCRETION TO DETERMINE
WHEN POV USE IS ADVANTAGEOUS TO THE
GOVERNMENT, THE FAA CANNOT EXERCISE ITS DISCRETION
IN AN ARBITRARY OR CAPRICIOUS MANNER.
EMPLOYEES WHO HAVE IDENTICAL TRAVEL SITUATIONS
SHOULD NOT BE TREATED DIFFERENTLY UNDER
FTR PARA. 1-2.2C MERELY BECAUSE SOME ARE
COVERED BY A LABOR-MANAGEMENT AGREEMENT AND
OTHERS ARE NOT. THE ONLY CRITERIA FOR
FINDING POV USE ADVANTAGEOUS TO THE GOVERNMENT
ARE SET OUT AT PARA. 1-2.2C. COVERAGE
UNDER A COLLECTIVE-BARGAINING AGREEMENT IS
NOT ONE OF THE CRITERIA. ONCE A DETERMINATION
IS MADE UNDER PARA. 1-2.2C TO FIND
ADVANTAGE TO THE GOVERNMENT IN A GIVEN SITUATION,
AN AGENCY MAY NOT DISCRIMINATE BETWEEN
CLASSES OF EMPLOYEES. ONCE THE FAA DECIDED
CERTAIN FACTORS CREATED AN ADVANTAGE TO THE
GOVERNMENT UNDER THE FTR, THEN THE FAA IS
REQUIRED TO APPLY SUCH A DETERMINATION TO
OTHER EMPLOYEES WHO MEET THOSE FACTORS. THE
ONLY EXCEPTION TO THIS WOULD BE IF FAA COULD
SHOW THAT OTHER CIRCUMSTANCES MILITATE
AGAINST THE FINDING OF ADVANTAGE IN A
PARTICULAR CASE."
FOLLOWING OUR DECISION IN ARD T. JOHNSON, THE ASSOCIATE ADMINISTRATOR
FOR ADMINISTRATION OF THE FAA ISSUED A LETTER DATED FEBRUARY 25, 1980,
TO REGIONAL AND CENTER DIRECTORS CONCERNING TRAVEL TO THE FAA ACADEMY BY
POV, AND PROVIDING CRITERIA TO BE USED IN COMPLYING WITH OUR DECISION.
THAT LETTER PROVIDED, IN PART, THAT:
"WHEN EMPLOYEES OUTSIDE THE FASTA
BARGAINING UNIT ATTEND A CLASS AT THE FAA
ACADEMY WHICH:
1. MEETS THE CRITERIA OF ARTICLE 19,
SECTION 1; AND
2. IS ATTENDED BY EMPLOYEES
SPECIFICALLY COVERED BY ARTICLE 19,
SECTION 1;
SUCH EMPLOYEES WILL BE AUTHORIZED USE
OF THEIR POV'S ON AN ADVANTAGEOUS TO THE
GOVERNMENT BASIS CONSISTENT WITH THE PROVISIONS
OF ARTICLE 19." BY THIS LETTER, THE FAA DECLINED TO CONSIDER
EMPLOYEEES OUTSIDE THE FASTA/NAGE BARGAINING UNIT AS IDENTICALLY
SITUATED TO EMPLOYEES COVERED BY THE FASTA/NAGE-FAA AGREEMENT UNLESS
THEY MET THE CRITERIA SET FORTH ABOVE, INCLUDING ATTENDANCE AT THE CLASS
BY ONE OR MORE EMPLOYEES SPECIFICALLY COVERED BY ARTICLE 19. THE FAA
THEN RECOMMENDED IN ITS ADMINISTRATIVE REPORT OF SEPTEMBER 9, 1981, THAT
MR. REID'S CLAIM BE DENIED SINCE NO EMPLOYEES SPECIFICALLY COVERED BY
ARTICLE 19 ATTENDED HIS CLASS AT THE FAA ACADEMY.
HOWEVER, WE HELD SOON THEREAFTER IN AIR TRAFFIC CONTROL TRAINEES,
B-201542, SEPTEMBER 18, 1981, THAT PARAGRAPH 6.B OF FAA SOUTHERN REGION
NOTICE SO N 1500.78, MAY 29, 1980, WHICH INCORPORATED THE STANDARDS
CONTAINED IN THE FEBRUARY 25, 1980, FAA LETTER, WAS UNDULY RESTRICTIVE,
AND MUST BE MODIFIED TO EXCLUDE THE REQUIREMENT THAT A CLASS BE ATTENDED
BY ONE OR MORE TRAINEES WHO ARE AIRWAY FACILITIES TECHNICIANS FOR AN
EMPLOYEE NOT COVERED BY THE FASTA/NAGE-FAA AGREEMENT TO QUALIFY FOR A
FINDING OF USE OF A POV AS ADVANTAGEOUS TO THE GOVERNMENT. WE DID,
HOWEVER, STATE THAT PARAGRAPH 6.B OF THE FAA NOTICE MAY CONTINUE TO
INCLUDE A REQUIREMENT THAT, IN ORDER TO QUALIFY FOR A FINDING OF USE OF
A POV AS ADVANTAGEOUS TO THE GOVERNMENT, AN EMPLOYEE MUST BE SUBJECT TO
"FREQUENT ASSIGNMENT TO RECURRING TRAINING."
WE HELD FURTHER IN AIR TRAFFIC CONTROL TRAINEES, THAT AIR TRAFFIC
CONTROL TRAINEES ARE NOT IDENTICALLY SITUATED TO MEMBERS OF THE FASTA/
NAGE BARGAINING UNIT SINCE THE FORMER ARE ALMOST EXCLUSIVELY NEW HIRES
WHO DO NOT PERFORM TRAINING AT THE FAA ACADEMY ON A RECURRING BASIS,
WHEREAS THE TECHNICIANS DO PERFORM SUCH TRAINING ON A RECURRING BASIS
DURING THEIR CAREERS. BECAUSE OF OUR DECISION IN AIR TRAFFIC CONTROL
TRAINEES, THE ISSUE IN THIS CASE COMES DOWN TO WHETHER MR. REID IS
SUBJECT TO "FREQUENT ASSIGNMENT TO RECURRING TRAINING" WITHIN THE
MEANING OF ARTICLE 19 AND OUR DECISION. THE FAA HAS NOT GENERALLY
DEFINED THIS TERM.
MR. REID CLAIMED IN A LETTER TO GAO DATED NOVEMBER 29, 1981, THAT HIS
SITUATION WAS DISTINGUISHABLE FROM THAT OF AIR TRAFFIC CONTROL TRAINEES,
AND THAT HE IS INDEED SUBJECT TO "FREQUENT ASSIGNMENT TO RECURRING
TRAINING." SPECIFICALLY, HE CONTENDED THAT DATA SYSTEMS SPECIALISTS LIKE
HIM: ARE NOT EXCLUSIVELY NEW HIRES (MR. REID HAS BEEN AN FAA EMPLOYEE
FOR 10 YEARS); MUST ATTEND THREE TO FOUR COURSES OF 3 TO 4 WEEKS
DURATION OVER A PERIOD OF APPROXIMATELY 4 YEARS; AND MAY WELL REQUIRE
ADDITIONAL TRAINING DUE TO THE ADVENT OF A NEW AIR TRAFFIC CONTROL
COMPUTER SYSTEM.
THE FAA RESPONDED TO OUR DECISION IN AIR TRAFFIC CONTROL TRAINEES,
AND TO MR. REID'S LETTER OF NOVEMBER 29, 1981, BY RECOMMENDING DENIAL OF
MR. REID'S CLAIM AGAIN ON MARCH 25, 1982, BECAUSE MR. REID WAS NOT, IN
THE FAA'S OPINION, SUBJECT TO "FREQUENT ASSIGNMENT TO RECURRING
TRAINING." THE FAA STATED, IN PERTINENT PART:
"IN YOUR PARTICULAR CASE, THE TRAINING
RECORDS INDICATE THAT ONLY TWO OF THE THREE
ENROUTE AUTOMATION PROGRAM COURSES YOU COMPLETED
IN THE LAST TWO YEARS WERE CONDUCTED
AT THE FAA ACADEMY; THE THIRD COURSE WAS
TAKEN AT YOUR FACILITY. ALTHOUGH THE ENROUTE
AUTOMATION TRAINING IS A TEN-PHASE PROGRAM,
IT CONSISTS OF CORRESPONDENCE AND FACILITY
TRAINING, AS WELL AS RESIDENT COURSES.
FURTHER, WE UNDERSTAND THAT ATTENDANCE AT ANY
OF THE REMAINING COURSES CANNOT BE PREDICTED
BECAUSE ATTENDANCE IS DISCRETIONARY AND IS
DEPENDENT UPON THE RECOMMENDATION OF THE DATA
SYSTEMS OFFICER, AND THE AVAILABILITY OF
FUNDING AND CLASS QUOTAS. THEREFORE, BASED
ON YOUR RECORD OF ATTENDANCE AND THE UNCERTAINTY
OF FUTURE ATTENDANCE, WE MUST CONCLUDE
THAT YOUR SITUATION DOES NOT MEET THE CONDITIONS
OF ARTICLE 19."
MR. REID TOOK ISSUE WITH THE FAA'S ASSESSMENT OF THE RECURRING NATURE
OF HIS TRAINING PROGRAM AS A DATA SYSTEMS SPECIALIST IN A LETTER DATED
MARCH 31, 1982, TO THE FAA. HE ARGUED:
"YOU STATED THAT I COMPLETED ONLY TWO
COURSES AT THE ACADEMY. THIS IS TRUE. IT
IS ALSO TRUE THAT, IN THE ABSENCE OF THE
CONTROLLER STRIKE, AND ASSUMING THAT MY
TRAINING PROGRAM WOULD BE IDENTICAL WITH ALL
OTHER RECENT DSS APPOINTEES, I WOULD HAVE
BEEN SCHEDULED FOR TWO MORE CLASSES AT THE
ACADEMY. EVEN WHILE I WAS AT THE ACADEMY
THE TRAINING PROGRAM WAS BEING CHANGED TO A
TEN-PHASE SEQUENCE, FIVE OF WHICH ARE CONDUCTED
AT THE ACADEMY. THIS MEANS THAT
THREE TO FIVE TRIPS TO OKLAHOMA CITY WOULD
BE NECESSARY TO COMPLETE THE PROGRAM, AND
ONE DOES NOT ATTAIN THE FULL PERFORMANCE
LEVEL (FPL) STATUS UNTIL ALL PHASES ARE
COMPLETED. ATTENDANCE, THEREFORE, IS NOT
DISCRETIONARY AS YOU CLAIM. THESE TRIPS
ARE IN ADDITION TO THE ONE OR TWO TRIPS
NECESSARY FOR ATC DEVELOPMENTALS. IF THESE
ARE INCLUDED IN THE TOTAL TRAINING PROGRAM,
SEVEN TRIPS TO OKLAHOMA CITY MIGHT BE
NECESSARY FOR THE FPL DSS. TO DATE, I HAVE
BEEN THERE THREE TIMES. WHEN I RETURN TO
AUTOMATION DUTIES, I WILL BE EXPECTED TO
MAKE AT LEAST TWO MORE. THE CONDITIONS SET
FORTH IN ARTICLE 19 ARE CERTAINLY FULFILLED." MR. REID FURTHER
CONTENDED THAT OTHER DATA SYSTEMS SPECIALISTS HAD BEEN PERMITTED USE OF
THEIR POV'S AS ADVANTAGEOUS TO THE GOVERNMENT WHILE ATTENDING COURSES AT
THE FAA ACADEMY.
WE DISAGREE WITH THE FAA'S CONTENTION THAT MR. REID'S TRAINING AT THE
FAA ACADEMY AS A DATA SYSTEMS SPECIALIST IS NOT "RECURRING TRAINING"
WITHIN THE MEANING OF ARTICLE 19, SECTION 1 OF THE FASTA/ NAGE-FAA
AGREEMENT, SINCE FUTURE ATTENDANCE AT REMAINING COURSES IN THE TEN-PHASE
PROGRAM:
"*** CANNOT BE PREDICTED BECAUSE
ATTENDANCE IS DISCRETIONARY AND IS DEPENDENT
UPON THE RECOMMENDATION OF THE DATA SYSTEMS
OFFICER AND THE AVAILABILITY OF FUNDING AND
CLASS QUOTAS. ***" WE NOTE THAT FUTURE ATTENDANCE AT MANY FORMS OF
TRAINING, INCLUDING PRESUMABLY THAT OF EMPLOYEES SPECIFICALLY COVERED BY
ARTICLE 19 OF THE FASTA/NAGE-FAA AGREEMENT, IS INHERENTLY SPECULATIVE
DUE TO THE REASONS CITED BY THE FAA. TO AGREE WITH THE FAA WOULD PERMIT
THE FAA TO FIND THAT ANY EMPLOYEE NOT IN THE FASTA/NAGE BARGAINING UNIT
IS NOT SUBJECT TO FREQUENT ASSIGNMENT TO RECURRING TRAINING AT THE FAA
ACADEMY BECAUSE HIS ATTENDANCE AT FUTURE TRAINING CAN NEVER BE A
CERTAINTY. WE HOLD THAT THE FAA IN THIS CASE HAS ADOPTED AN OVERLY
RESTRICTIVE INTERPRETATON OF THE TERM "RECURRING TRAINING" AS USED IN
ARTICLE 19. WHERE IT IS NECESSARY FOR AN EMPLOYEE TO COMPLETE A
TEN-PHASE TRAINING PROGRAM, WITH ONE-HALF OF THE COURSES AT THE FAA
ACADEMY, IN ORDER TO REACH THE FULL PERFORMANCE LEVEL, THAT EMPLOYEE IS
SUBJECT TO FREQUENT ASSIGNMENT TO RECURRING TRAINING AND IS ENTITLED TO
USE HIS POV AS ADVANTAGEOUS TO THE GOVERNMENT, IF THE OTHER CONDITIONS
OF ARTICLE 19 AND OUR DECISIONS ARE MET.
IN SUM, SINCE WE HOLD THAT MR. REID IS SUBJECT TO FREQUENT ASSIGNMENT
TO RECURRING TRAINING AT THE FAA ACADEMY, AND THERE IS NO DISPUTE THAT
MR. REID OTHERWISE MEETS THE CRITERIA OF ARTICLE 19 AND OUR DECISIONS,
WE CONCLUDE THAT MR. REID IS IDENTICALLY SITUATED TO EMPLOYEES
SPECIFICALLY COVERED BY ARTICLE 19 OF THE FASTA/NAGE-FAA AGREEMENT.
THEREFORE, SINCE THE FAA MAY NOT DISCRIMINATE BETWEEN MR. REID AND
EMPLOYEES SPECIFICALLY COVERED BY ARTICLE 19 WHERE THEY ARE IDENTICALLY
SITUATED, WE HOLD THAT MR. REID'S CLAIM IN THE AMOUNT OF $411.40, MAY BE
PAID. SETTLEMENT WILL ISSUE IN DUE COURSE.
B-210611, MAR 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
IN VIEW OF THE LIMITED PURPOSE OF AN INVITATION'S ANNOUNCED ESTIMATED
COST RANGE, AND THE RESPONSIBILITY OF BIDDERS TO DETERMINE THEIR OWN BID
PRICES, PROTESTER'S ALLEGATION THAT IT WAS MISLED BY BIDDING WITHIN WHAT
IT PERCEIVED TO BE THE INVITATION'S ESTIMATED COST RANGE IS WITHOUT
MERIT.
WESTERN VENTURES, INC.:
WESTERN VENTURES, INC., PROTESTS ANY AWARD UNDER INVITATION FOR BIDS
(IFB) NO. DTFA09-83-B-20001, ISSUED BY THE DEPARTMENT OF
TRANSPORTATION'S FEDERAL AVIATION ADMINISTRATION, FOR THE INSTALLATION
OF METAL SIDING ON AN AIR TRAFFIC CONTROL TOWER. WESTERN CONTENDS THAT
INFORMATION AND DOCUMENTS CONTAINED IN THE IFB MISLED BIDDERS REGARDING
THE GOVERNMENT'S ESTIMATED PRICE RANGE FOR COMPLETION OF THE
CONSTRUCTION PROJECT.
WE SUMMARILY DENY THE PROTEST BECAUSE IT IS CLEAR FROM WESTERN'S
SUBMISSION THAT THE PROTEST IS WITHOUT LEGAL MERIT. GOMEZ ELECTRICAL
CONTRACTORS, INC., B-208688, SEPTEMBER 8, 1982, 82-2 CPD 214.
WESTERN ASSERTS THAT THE IFB'S PUBLISHED GOVERNMENT ESTIMATE RANGE OF
"UNDER $40,000," PLUS THE IFB'S INCLUSION OF BOND FORMS APPLICABLE TO
BIDS IN EXCESS OF $25,000, LED IT AND OTHER BIDDERS TO BELIEVE THAT THE
GOVERNMENT ESTIMATE RANGE WAS BETWEEN $25,000 AND $40,000. WESTERN
STATES THAT THE ACTUAL GOVERNMENT ESTIMATE - FIRST REVEALED TO WESTERN
AT BID OPENING - WAS UNDER $25,000. WESTERN IMPLIES THAT IT AND 6 OTHER
FIRMS WHICH BID IN EXCESS OF $25,000 WERE MISLED BY THE IFB'S FAILURE TO
PROVIDE A MORE SPECIFIC ESTIMATE RANGE THAN "UNDER $40,000."
THE PURPOSE OF SUPPLYING BIDDERS AN ESTIMATED PRICE RANGE PRIOR TO
BIDDING IS TO DISCLOSE INFORMATION CONCERNING THE RELATIVE MAGNITUDE OF
THE CONSTRUCTION PROJECT. FEDERAL PROCUREMENT REGULATIONS SEC.
1-18.109 (1964 ED.). BID PRICES, HOWEVER, ARE NOT LIMITED TO THE
CONFINES OF THE ESTIMATE RANGE SET FORTH IN THE IFB, AND A BIDDER IS
STILL RESPONSIBLE FOR PREPARING ITS OWN INDEPENDENT BID. SEE SCOTT
GLASS, INC. - RECONSIDERATION, B-185864, AUGUST 17, 1976, 76-2 CPD 164.
IN THIS CASE, WE CONCLUDE THAT THE IFB'S ANNOUNCED RANGE OF "UNDER
$40,000" FULFILLED THE LIMITED REGULATORY REQUIREMENT OF DISCLOSING
INFORMATION ON THE RELATIVE MAGNITUDE OF THE PROJECT, AND THAT THE IFB'S
BOND FORMS SIMPLY WERE PROVIDED FOR FIRMS CHOOSING TO SUBMIT BIDS IN
EXCESS OF $25,000. IN ANY EVENT, SINCE IT ULTIMATELY IS THE
RESPONSIBILITY OF A BIDDER TO DETERMINE ITS OWN BID PRICE WITHOUT
RELIANCE ON AN ANNOUNCED OR PERCEIVED GOVERNMENT ESTIMATE RANGE,
WESTERN'S ARGUMENT THAT IT AND OTHER BIDDERS WERE MISLED INTO BIDDING
WITHIN A SPECIFIED RANGE IS WITHOUT MERIT.
THE PROTEST IS DENIED.
B-210611, MAR 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
IN VIEW OF THE LIMITED PURPOSE OF AN INVITATION'S ANNOUNCED ESTIMATED
COST RANGE, AND THE RESPONSIBILITY OF BIDDERS TO DETERMINE THEIR OWN BID
PRICES, PROTESTER'S ALLEGATION THAT IT WAS MISLED BY BIDDING WITHIN WHAT
IT PERCEIVED TO BE THE INVITATION'S ESTIMATED COST RANGE IS WITHOUT
MERIT.
WESTERN VENTURES, INC.:
WESTERN VENTURES, INC., PROTESTS ANY AWARD UNDER INVITATION FOR BIDS
(IFB) NO. DTFA09-83-B-20001, ISSUED BY THE DEPARTMENT OF
TRANSPORTATION'S FEDERAL AVIATION ADMINISTRATION, FOR THE INSTALLATION
OF METAL SIDING ON AN AIR TRAFFIC CONTROL TOWER. WESTERN CONTENDS THAT
INFORMATION AND DOCUMENTS CONTAINED IN THE IFB MISLED BIDDERS REGARDING
THE GOVERNMENT'S ESTIMATED PRICE RANGE FOR COMPLETION OF THE
CONSTRUCTION PROJECT.
WE SUMMARILY DENY THE PROTEST BECAUSE IT IS CLEAR FROM WESTERN'S
SUBMISSION THAT THE PROTEST IS WITHOUT LEGAL MERIT. GOMEZ ELECTRICAL
CONTRACTORS, INC., B-208688, SEPTEMBER 8, 1982, 82-2 CPD 214.
WESTERN ASSERTS THAT THE IFB'S PUBLISHED GOVERNMENT ESTIMATE RANGE OF
"UNDER $40,000," PLUS THE IFB'S INCLUSION OF BOND FORMS APPLICABLE TO
BIDS IN EXCESS OF $25,000, LED IT AND OTHER BIDDERS TO BELIEVE THAT THE
GOVERNMENT ESTIMATE RANGE WAS BETWEEN $25,000 AND $40,000. WESTERN
STATES THAT THE ACTUAL GOVERNMENT ESTIMATE - FIRST REVEALED TO WESTERN
AT BID OPENING - WAS UNDER $25,000. WESTERN IMPLIES THAT IT AND 6 OTHER
FIRMS WHICH BID IN EXCESS OF $25,000 WERE MISLED BY THE IFB'S FAILURE TO
PROVIDE A MORE SPECIFIC ESTIMATE RANGE THAN "UNDER $40,000."
THE PURPOSE OF SUPPLYING BIDDERS AN ESTIMATED PRICE RANGE PRIOR TO
BIDDING IS TO DISCLOSE INFORMATION CONCERNING THE RELATIVE MAGNITUDE OF
THE CONSTRUCTION PROJECT. FEDERAL PROCUREMENT REGULATIONS SEC.
1-18.109 (1964 ED.). BID PRICES, HOWEVER, ARE NOT LIMITED TO THE
CONFINES OF THE ESTIMATE RANGE SET FORTH IN THE IFB, AND A BIDDER IS
STILL RESPONSIBLE FOR PREPARING ITS OWN INDEPENDENT BID. SEE SCOTT
GLASS, INC. - RECONSIDERATION, B-185864, AUGUST 17, 1976, 76-2 CPD 164.
IN THIS CASE, WE CONCLUDE THAT THE IFB'S ANNOUNCED RANGE OF "UNDER
$40,000" FULFILLED THE LIMITED REGULATORY REQUIREMENT OF DISCLOSING
INFORMATION ON THE RELATIVE MAGNITUDE OF THE PROJECT, AND THAT THE IFB'S
BOND FORMS SIMPLY WERE PROVIDED FOR FIRMS CHOOSING TO SUBMIT BIDS IN
EXCESS OF $25,000. IN ANY EVENT, SINCE IT ULTIMATELY IS THE
RESPONSIBILITY OF A BIDDER TO DETERMINE ITS OWN BID PRICE WITHOUT
RELIANCE ON AN ANNOUNCED OR PERCEIVED GOVERNMENT ESTIMATE RANGE,
WESTERN'S ARGUMENT THAT IT AND OTHER BIDDERS WERE MISLED INTO BIDDING
WITHIN A SPECIFIED RANGE IS WITHOUT MERIT.
THE PROTEST IS DENIED.
B-210609.2, FEB 25, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST FILED WITH GAO MORE THAN 10 WORKING DAYS AFTER THE PROTESTER
LEARNS OF INITIAL ADVERSE AGENCY ACTION ON ITS PROTEST FILED WITH THE
AGENCY IS DISMISSED AS UNTIMELY.
CLEMENTS NATIONAL COMPANY:
CLEMENTS NATIONAL COMPANY (CLEMENTS) PROTESTS THE AWARD OF A CONTRACT
TO MASTERCRAFT INDUSTRIES (MASTERCRAFT) UNDER INVITATION FOR BIDS (IFB)
NO. 9FCB-OLK-A-A0641/82, ISSUED BY THE GENERAL SERVICES ADMINISTRATION
(GSA), REGION 9, SAN FRANCISCO, CALIFORNIA.
WE DISMISS THE PROTEST AS UNTIMELY.
THE IFB SOLICITED BIDS FOR A COMMERCIAL VACUUM CLEANER. BIDS WERE
OPENED ON AUGUST 13, 1982. BY LETTER OF NOVEMBER 8, 1982, CLEMENTS
FILED A PROTEST WITH THE CONTRACTING OFFICER, ARGUING THAT MASTERCRAFT
DID NOT COMPLY WITH THE SPECIFICATIONS. GSA, HOWEVER, DISMISSED
CLEMENTS' PROTEST AS UNTIMELY. IN A LETTER DATED DECEMBER 2, 1982, GSA
EXPLAINED THAT CLEMENTS SHOULD HAVE FILED ITS PROTEST NO LATER THAN 10
WORKING DAYS AFTER THE AUGUST 13 BID OPENING. ON FEBRUARY 7, 1983,
CLEMENTS FILED A PROTEST WITH OUR OFFICE ARGUING THAT ITS PROTEST TO THE
CONTRACTING OFFICER WAS TIMELY SINCE IT WAS FILED 3 DAYS AFTER IT
LEARNED THE BASIS FOR ITS PROTEST - THAT IS, 3 DAYS AFTER IT RECEIVED A
SAMPLE UNIT FROM MASTERCRAFT AND UPON INSPECTION DISCOVERED THAT
MASTERCRAFT'S UNIT DID NOT MEET THE IFB'S SPECIFICATIONS.
UNDER OUR BID PROTEST PROCEDURES, IF A PROTEST IS FILED INITIALLY
WITH THE CONTRACTING AGENCY, ANY SUBSEQUENT PROTEST TO OUR OFFICE MUST
BE FILED WITHIN 10 WORKING DAYS OF NOTIFICATION OF INITIAL ADVERSE
AGENCY ACTION. 4 C.F.R. SEC. 21.2(A) (1982). SINCE CLEMENTS WAS
ADVISED BY GSA'S DECEMBER 2, 1982, LETTER THAT ITS PROTEST TO THE AGENCY
WAS DISMISSED AS UNTIMELY, THIS CONSTITUTED INITIAL ADVERSE AGENCY
ACTION REQUIRING ANY SUBSEQUENT PROTEST TO OUR OFFICE TO BE FILED WITHIN
10 WORKING DAYS AFTER CLEMENTS' RECEIPT OF THE GSA LETTER. AS NOTED
ABOVE, CLEMENTS' PROTEST TO OUR OFFICE WAS RECEIVED ON FEBRUARY 7, 1983.
THIS WAS CLEARLY MORE THAN 10 WORKING DAYS AFTER CLEMENTS LEARNED OF
THE GSA DECISION AND, THEREFORE, ITS PROTEST TO OUR OFFICE IS ALSO
UNTIMELY. AFRI-AMERICAN SUPPLY COMPANY, B-206137, FEBRUARY 17, 1982,
82-1 CPD 141.
PROTEST DISMISSED.
B-210609, JUN 9, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO WILL NOT DISMISS A PROTEST BECAUSE OF THE PROTESTER'S FAILURE
TO SUBMIT AN ADDITIONAL STATEMENT IN SUPPORT OF ITS INITIAL PROTEST
WITHIN 5 WORKING DAYS AFTER RECEIPT OF GAO'S LETTER OF ACKNOWLEDGMENT
SINCE GAO'S BID PROTEST PROCEDURES REQUIRE THAT THE PROTESTER BE
EXPRESSLY NOTIFIED OF THIS REQUIREMENT AND, DUE TO AN ADMINISTRATIVE
ERROR, GAO'S ACKNOWLEDGMENT LETTER FAILED TO DO THIS.
2. GAO WILL NOT DISMISS A PROTEST ON THE GROUNDS THAT, WHEN THE
PROTESTER SUBMITTED A STATEMENT OF THE SPECIFIC GROUNDS UPON WHICH ITS
PROTEST WAS BASED, IT INDICATED DISAGREEMENT WITH THE SMALL BUSINESS
ADMINISTRATION (SBA) DECISION NOT TO ISSUE A CERTIFICATE OF COMPETENCY
(COC). WHILE, AS A GENERAL RULE, GAO DOES NOT REVIEW SUCH MATTERS, THE
PROTESTER'S ADDITIONAL STATEMENT ALLEGED THAT SBA HAD ACTED IN BAD
FAITH, AN ALLEGATION WHICH GAO WILL REVIEW.
3. ALTHOUGH THE PROTESTER MADE NO SHOWING THAT SBA HAD ACTED IN BAD
FAITH, IT DID PRESENT EVIDENCE THAT SBA'S ORIGINAL REFUSAL TO ISSUE A
COC WAS BECAUSE OF SBA'S DETERMINATION THAT THE PROTESTER WAS NOT
ELIGIBLE FOR THE COC PROGRAM BUT, BECAUSE OF NEW INFORMATION PRESENTED
BY THE PROTESTER, SBA IS NOW WILLING TO REOPEN THE MATTER OF THE
PROTESTER'S RESPONSIBILITY IF THE CONTRACTING AGENCY WILL RESUBMIT THE
MATTER TO SBA.
4. CONTRARY TO THE AGENCY'S BELIEF, IT CANNOT REFUSE TO RESUBMIT THE
MATTER OF THE PROTESTER'S RESPONSIBILITY TO SBA. ORIGINAL SBA DECISION
WAS NOT A FINAL DETERMINATION AND, SINCE SBA AND NOT THE CONTRACTING
AGENCY HAS THE STATUTORY AUTHORITY TO MAKE A FINAL DISPOSITION WITH
RESPECT TO THE PROTESTER'S RESPONSIBILITY, GAO RECOMMENDS THAT THE
AGENCY RESUBMIT THE MATTER TO SBA.
KARI-VAC, INC.:
KARI-VAC, INC. (KARI-VAC), PROTESTS THE DETERMINATION BY THE GENERAL
SERVICES ADMINISTRATION (GSA) THAT IT IS A NONRESPONSIBLE BIDDER AND,
THEREFORE, IS NOT ENTITLED TO THE AWARD UNDER INVITATION FOR BIDS (IFB)
NO. 9FCB-OLK-A-A0641/83.
WE SUSTAIN THE PROTEST.
THE IFB SOLICITED CLEANING EQUIPMENT SUCH AS VACUUM CLEANERS AND
FLOOR POLISHERS. THIS EQUIPMENT WILL BE AVAILABLE UNDER THE FEDERAL
SUPPLY SCHEDULE (FSS), FSC79, PART I, SECTION "A." KARI-VAC WAS THE LOW
BIDDER, AND GSA CONDUCTED A PREAWARD SURVEY. THE PREAWARD SURVEY TEAM
CONCLUDED THAT KARI-VAC WAS INCAPABLE OF PERFORMING THE CONTRACT BECAUSE
OF POOR PERFORMANCE ON CURRENT AND PAST CONTRACTS AND INDICATIONS OF
FINANCIAL WEAKNESS AS EVIDENCED BY ITS POOR CREDIT RATING, POOR PAYMENT
HISTORY, AND A LARGE NUMBER OF TAX LIENS AND JUDGMENTS AGAINST THE
COMPANY.
SINCE KARI-VAC IS A SMALL BUSINESS, GSA REFERRED THE MATTER TO THE
SMALL BUSINESS ADMINISTRATION (SBA) - THE AGENCY WITH CONCLUSIVE
AUTHORITY TO DETERMINE ALL ELEMENTS OF RESPONSIBILITY FOR SMALL BUSINESS
CONCERNS - FOR POSSIBLE ISSUANCE OF A CERTIFICATE OF COMPETENCY (COC).
SBA, HOWEVER, DECLINED TO ISSUE A COC, CITING THE FACT THAT KARI-VAC'S
PRESIDENT WAS ON 3 YEARS' PROBATION. BASED ON THE FAILURE OF SBA TO
ISSUE A COC, GSA FINALIZED ITS DETERMINATION THAT KARI-VAC IS A
NONRESPONSIBLE BIDDER AND, THEREFORE, NOT ENTITLED TO THE AWARD. NO
AWARD HAS BEEN MADE.
KARI-VAC ARGUES THAT IT IS A RESPONSIBLE BIDDER, THAT GSA'S PREAWARD
SURVEY FAILS TO CONSIDER THE TRUE REASONS FOR ITS PAST FINANCIAL
PROBLEMS, AND THAT IT IS NOW ELIGIBLE FOR A COC AND, THEREFORE, SHOULD
HAVE THE QUESTION OF ITS RESPONSIBILITY REFERRED AGAIN TO SBA FOR
ISSUANCE OF THE COC. KARI-VAC NOTES THAT IT HAS BEEN INFORMED BY SBA'S
REGIONAL COUNSEL THAT IT WAS NOT ACTUALLY DENIED A COC BUT, RATHER, THE
QUESTION OF KARI-VAC'S ELIGIBILITY FOR A COC WAS SUSPENDED IN VIEW OF
KARI-VAC'S PRESIDENT BEING PLACED ON PROBATION FOR A PERIOD OF 3 YEARS
FOR SOCIAL SECURITY VIOLATIONS. IT IS APPARENTLY SBA'S POLICY NOT TO
CONSIDER COC APPLICATIONS FOR POTENTIAL CONTRACTORS WHO ARE UNDER COURT
SUPERVISION. KARI-VAC, HOWEVER, POINTS OUT THAT THE FEDERAL DISTRICT
COURT HAS NOW REMOVED KARI-VAC'S PRESIDENT FROM PROBATION AND THAT, IN
LIGHT OF THIS INFORMATION, SBA HAS INFORMED THE PROTESTER THAT IT IS NOW
ELIGIBLE FOR A COC AND THAT IT SHOULD CONTACT GSA AND ATTEMPT TO HAVE
THE AGENCY REQUEST ANOTHER COC.
BASED ON THE FOREGOING, KARI-VAC BELIEVES THAT IT IS ENTITLED TO THE
AWARD AS THE LOW RESPONSIVE, RESPONSIBLE BIDDER.
GSA DISAGREES. AT THE OUTSET, GSA ARGUES THAT KARI-VAC'S PROTEST
SHOULD BE DISMISSED FOR THE PROTESTER'S FAILURE TO STATE A BASIS FOR
PROTEST IN A TIMELY MANNER. IN OTHER WORDS, GSA NOTES THAT KARI-VAC'S
INITIAL TELEGRAM ONLY STATED THAT KARI-VAC WAS THE LOW BIDDER ON VARIOUS
ITEMS UNDER THE IFB AND NOTHING MORE. SINCE IT IS GAO'S POLICY IN SUCH
A SITUATION TO REQUIRE THE PROTESTER TO FURNISH ADDITIONAL INFORMATION,
WHICH STATES ITS BASIS FOR PROTEST, WITHIN 5 WORKING DAYS AFTER RECEIPT
OF GAO'S ACKNOWLEDGMENT LETTER, AND SINCE KARI-VAC FAILED TO DO THIS,
GSA CONCLUDES THAT KARI-VAC'S PROTEST SHOULD BE DISMISSED AS UNTIMELY.
IN ADDITION, GSA POINTS OUT THAT, WHEN KARI-VAC DID FINALLY FURNISH
ANOTHER STATEMENT, THIS STATEMENT WAS AGAIN QUITE TERSE AND ONLY
INDICATED THAT KARI-VAC WAS PROTESTING SBA'S REFUSAL TO ISSUE A COC - A
MATTER WHICH, AS A GENERAL RULE, OUR OFFICE DOES NOT REVIEW. THUS, GSA
SEES THIS AS ANOTHER BASIS FOR DISMISSING THE PROTEST.
AS TO THE MERITS OF KARI-VAC'S PROTEST, GSA ARGUES THAT, SINCE SBA
HAS CONCLUSIVE AUTHORITY TO DETERMINE ALL ELEMENTS OF RESPONSIBILITY FOR
SMALL BUSINESS CONCERNS, AND SINCE SBA HAS REFUSED TO ISSUE A COC IN
THIS CASE, GAO HAS NO BASIS FOR QUESTIONING THE SBA DETERMINATION AND,
THEREFORE, SHOULD DISMISS THE PROTEST ON THIS GROUND.
ON THE OTHER HAND, IN REGARD TO THE FEDERAL DISTRICT COURT'S DECISION
TO RELEASE KARI-VAC'S PRESIDENT FROM PROBATION, GSA ARGUES THAT THIS HAS
NO IMPACT ON THE QUESTION OF KARI-VAC'S RESPONSIBILITY. GSA NOTES THAT
IT DID NOT BASE ITS NONRESPONSIBILITY DETERMINATION ON THE CONVICTION
AND PROBATION OF KARI-VAC'S PRESIDENT, BUT ON KARI-VAC'S POOR CONTRACT
PERFORMANCE AND ITS WEAK FINANCIAL SITUATION WHICH, ACCORDING TO GSA,
HAS NOT IMPROVED. IN GSA'S OPINION, THEN, KARI-VAC'S "NEW INFORMATION"
DOES NOT ALTER THE INITIAL NONRESPONSIBILITY DETERMINATION AND IT HAS NO
LEGAL OBLIGATION TO REQUEST THAT SBA RECONSIDER WHETHER A COC SHOULD BE
ISSUED.
UNDER OUR BID PROTEST PROCEDURES, IF OUR OFFICE DETERMINES THAT AN
ADDITIONAL STATEMENT IN SUPPORT OF THE INITIAL PROTEST IS REQUIRED, THE
PROTESTER IS REQUIRED TO FURNISH BOTH OUR OFFICE AND THE CONTRACTING
AGENCY A COPY OF THIS STATEMENT NOT LATER THAN 5 WORKING DAYS AFTER
RECEIPT OF NOTIFICATION FROM GAO OF THE NEED FOR SUCH AN ADDITIONAL
STATEMENT. 4 C.F.R. SEC. 21.2(D) (1983). WE AGREE WITH GSA THAT
KARI-VAC'S INITIAL PROTEST DID NOT STATE A BASIS FOR PROTEST. HOWEVER,
DUE TO AN ADMINISTRATIVE ERROR, OUR OFFICE DID NOT SEND KARI-VAC
NOTIFICATION THAT AN ADDITIONAL STATEMENT IN SUPPORT OF THE INITIAL
PROTEST WAS REQUIRED. RATHER, WE SENT KARI-VAC A LETTER WHICH SIMPLY
ACKNOWLEDGED RECEIPT OF ITS PROTEST. THUS, KARI-VAC WAS NOT ON NOTICE
THAT IT WAS REQUIRED TO FURNISH AN ADDITIONAL STATEMENT. IN LIGHT OF
THIS, SECTION 21.2(D) OF OUR BID PROTEST PROCEDURES DOES NOT APPLY, AND
KARI-VAC CANNOT BE PENALIZED FOR NOT FURNISHING AN ADDITIONAL STATEMENT
WITHIN 5 WORKING DAYS AFTER ITS RECEIPT OF OUR LETTER OF ACKNOWLEDGMENT.
AFTER OUR OFFICE DISCOVERED ITS ERROR, KARI-VAC WAS REQUESTED TO
SUBMIT A STATEMENT OF THE SPECIFIC GROUNDS UPON WHICH ITS PROTEST WAS
BASED. IN RESPONSE, KARI-VAC SENT A SHORT TELEGRAM WHICH STATED THAT
SBA HAD "REJECTED OUR COC *** WITHOUT PROPER PROCEDURE AND JUST CAUSE."
ALTHOUGH OUR OFFICE GENERALLY DOES NOT REVIEW SBA'S COC DETERMINATIONS,
WE WILL REVIEW A PROTEST - SUCH AS KARI-VAC'S - WHICH ALLEGES THAT SBA
FAILED TO CONSIDER INFORMATION VITAL TO ITS COC DETERMINATION. SEE
SKILLENS ENTERPRISES, B-202508.2, DECEMBER 15, 1981, 81-2 CPD 472.
THUS, WE DO NOT AGREE WITH GSA THAT KARI-VAC'S PROTEST DESERVED TO BE
DISMISSED WHEN THE PROTESTER INDICATED THAT IT DISAGREED WITH SBA'S
REFUSAL TO ISSUE A COC. BEFORE WE COULD DISMISS THE PROTEST, WE NEEDED
A FURTHER EXPLANATION OF THE BASIS FOR SBA'S NEGATIVE COC DETERMINATION.
THROUGH THE AGENCY REPORT AND KARI-VAC'S COMMENTS ON THAT REPORT, WE
HAVE OBTAINED THE ADDITIONAL INFORMATION WE NEEDED.
AS GSA HAS INDICATED, UNDER 15 U.S.C. SEC. 637(B)(7) (SUPP. III,
1979), SBA HAS CONCLUSIVE AUTHORITY TO DETERMINE ALL ELEMENTS OF A SMALL
BUSINESS CONCERN'S RESPONSIBILITY BY ISSUING OR DECLINING TO ISSUE A
COC. OUR OFFICE WILL NOT QUESTION SBA'S REFUSAL TO ISSUE A COC UNLESS
THE SMALL BUSINESS CAN SHOW THAT THERE WAS FRAUD OR BAD FAITH ON THE
PART OF GOVERNMENT OFFICIALS. D. J. FINDLEY AND COMPANY, B-209417,
OCTOBER 27, 1982, 82-2 CPD 375.
FROM THE FACTS SET OUT ABOVE, IT IS CLEAR THAT SBA DECLINED TO ISSUE
A COC BECAUSE KARI-VAC'S PRESIDENT WAS ON PROBATION AT THE TIME SBA MADE
THE DETERMINATION. THERE IS NO EVIDENCE OF FRAUD OR BAD FAITH.
CONSEQUENTLY, OUR OFFICE HAS NO BASIS TO QUESTION SBA'S DECISION THAT
KARI-VAC WAS "NOT ELIGIBLE FOR COC ASSISTANCE BECAUSE OF RECENT LEGAL
ACTIONS." D. J. FINDLEY AND COMPANY, SUPRA.
HOWEVER, IT ALSO APPEARS THAT SBA NEVER CONSIDERED THE SPECIFIC
REASONS FOR GSA'S NONRESPONSIBILITY DETERMINATION. KARI-VAC HAS
PRESENTED OUR OFFICE WITH A DETAILED REBUTTAL TO THE CONCLUSIONS GSA
REACHED IN ITS PREAWARD SURVEY. IN ADDITION, SBA HAS INFORMED KARI-VAC
THAT, IN VIEW OF THE RECENT COURT DECISION TO RELEASE KARI-VAC'S
PRESIDENT FROM FURTHER COURT SUPERVISION, KARI-VAC IS NOW CONSIDERED
ELIGIBLE FOR A COC AND SBA IS WILLING TO REOPEN KARI-VAC'S CASE IF GSA
AGREES TO REFER THE MATTER TO SBA. GSA, HOWEVER, HAS REFUSED TO MAKE
THE REFERRAL ON THE GROUNDS THAT ITS ORIGINAL NONRESPONSIBILITY
DETERMINATION WAS NOT BASED ON KARI-VAC'S PRESIDENT BEING UNDER COURT
SUPERVISION, BUT BECAUSE OF KARI-VAC'S PREVIOUSLY POOR CONTRACT
PERFORMANCE AND ITS PRESENT WEAK FINANCIAL SITUATION. THUS, IN GSA'S
OPINION, THE RELEASE FROM COURT SUPERVISION IS NOT "NEW INFORMATION"
WHICH REQUIRES THE CONTRACTING AGENCY TO REASSESS A BIDDER'S
RESPONSIBILITY, AND IT THEREFORE WILL NEITHER RECONSIDER KARI-VAC'S
RESPONSIBILITY ON ITS OWN NOR ASK SBA TO CONSIDER THE POSSIBLE ISSUANCE
OF A COC.
IN REACHING THIS CONCLUSION, GSA RELIES ON OUR DECISION IN THE MATTER
OF REUBEN GARMENT INTERNATIONAL CO., INC., B-198923, SEPTEMBER 11, 1980,
80-2 CPD 191. THERE, WE HELD THAT WHERE THE CONTRACTING AGENCY,
FOLLOWING A DETERMINATION THAT THE BIDDER WAS NONRESPONSIBLE AND A
NEGATIVE COC DETERMINATION BY SBA, RECONSIDERS ITS NONRESPONSIBILITY
DETERMINATION IN LIGHT OF NEW INFORMATION PRESENTED BY THE BIDDER AND
DETERMINES THAT THE BIDDER REMAINS NONRESPONSIBLE, THE AGENCY HAS NO
LEGAL OBLIGATION TO REQUEST SBA RECONSIDERATION. HOWEVER, WE FIND THAT
REUBEN GARMENT IS NOT CONTROLLING HERE.
OUR OFFICE WAS PRESENTED WITH A SITUATION ANALOGOUS TO KARI-VAC'S IN
UNITED TEREX, INC., B-206090, MARCH 22, 1982, 82-1 CPD 268. THERE, SBA
INITIALLY DETERMINED THAT THE PROTESTER WAS NOT ELIGIBLE FOR A COC
BECAUSE THE FIRM WAS NOT GOING TO PERFORM A SIGNIFICANT PORTION OF THE
WORK WITH PERSONNEL ON ITS OWN PAYROLL. HOWEVER, THE PROTESTER
SUBMITTED FURTHER INFORMATION WHICH INDICATED THAT THE PROTESTER COULD
OVERCOME SBA'S INITIAL OBJECTIONS. CONSEQUENTLY, SBA ASKED THE
CONTRACTING AGENCY TO DEFER ITS PROPOSED AWARD AND RESUBMIT THE MATTER
OF THE PROTESTER'S RESPONSIBILITY, NOTING THAT THE BASIC QUESTION FOR
ELIGIBILITY HAD NOT BEEN PART OF THE AGENCY'S COC REFERRAL. THE AGENCY,
HOWEVER, REFUSED TO RESUBMIT THE MATTER TO SBA, ARGUING THAT IT HAD
REVIEWED THE PROTESTER'S "NEW INFORMATION" AND FOUND THAT IT DID NOT
ALTER THE ORIGINAL NONRESPONSIBILITY DETERMINATION AND, MOREOVER, THAT
IT WAS UNDER NO LEGAL OBLIGATION TO RESUBMIT THE MATTER TO SBA. IN
SUPPORT OF THIS DECISION, THE AGENCY, LIKE GSA, CITED REUBEN GARMENT.
WE HELD, HOWEVER, THAT THE AGENCY'S RELIANCE ON REUBEN GARMENT WAS
MISPLACED SINCE THE CASE PRESENTED WAS NOT SIMILAR TO THOSE SITUATIONS
WHERE SBA DECLINED TO ISSUE A COC BASED ON CONSIDERATION OF FACTORS
RELATED TO RESPONSIBILITY. WE STATED THAT "SBA'S DENIAL OF A COC BASED
ON THE BIDDER'S ELIGIBILITY UNDER THE COC PROCEDURE RATHER THAN THE
BIDDER'S NONRESPONSIBILITY DOES NOT AFFIRM THE CONTRACTING OFFICER'S
NONRESPONSIBILITY DETERMINATION." IN ADDITION, WE NOTED THAT SBA'S
WILLINGNESS TO RECONSIDER THE PROTESTER'S ELIGIBILITY AND ITS REQUEST TO
THE AGENCY THAT IT RESUBMIT THE MATTER OF THE PROTESTER'S RESPONSIBILITY
FURTHER INDICATED THAT SBA'S DECISION DID NOT CONSTITUTE A FINAL
DETERMINATION. WE RECOMMENDED THAT THE AGENCY RESUBMIT THE MATTER TO
SBA.
WE REACH THE SAME CONCLUSION HERE. SBA DENIED KARI-VAC A COC BECAUSE
OF ITS DETERMINATION THAT KARI-VAC WAS NOT ELIGIBLE FOR THE COC PROGRAM
DUE TO THE COURT SUPERVISION OF KARI-VAC'S PRESIDENT. SBA DID NOT
REVIEW THE SPECIFIC REASONS FOR GSA'S NONRESPONSIBILITY DETERMINATION
AND HAS RECENTLY INDICATED A WILLINGNESS TO REOPEN THE MATTER OF
KARI-VAC'S RESPONSIBILITY. IN VIEW OF THESE FACTS, WE FIND THAT SBA'S
ORIGINAL REFUSAL TO ISSUE A COC DID NOT CONSTITUTE A FINAL
DETERMINATION. UNITED TEREX, INC., SUPRA. WE RECOMMEND, THEREFORE,
THAT THE MATTER BE RESUBMITTED TO SBA SINCE IT IS SBA, NOT THE
CONTRACTING AGENCY, WHICH HAS THE STATUTORY AUTHORITY TO MAKE A FINAL
DISPOSITION WITH RESPECT TO KARI-VAC'S RESPONSIBILITY.
BY SEPARATE LETTER OF TODAY, WE ARE NOTIFYING GSA OF OUR
RECOMMENDATION.
B-210608, JUN 13, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
FACTORING STARTUP COSTS INTO THE INITIAL BID PERIOD DOES NOT CREATE A
MATHEMATICALLY UNBALANCED BID SO LONG AS EACH TIME PERIOD UNDER THE
CONTRACT CARRIES ITS PROPORTIONAL SHARE OF COST AND PROFIT. MOREOVER,
ALLEGED UNBALANCED BID REMAINS LOW THROUGHOUT THE CONTRACT REGARDLESS OF
WHETHER THE GOVERNMENT EXERCISES OPTIONS.
PROFESSIONAL REPROGRAPHIC SERVICES:
THE NATIONAL TRANSPORTATION SAFETY BOARD (NTSB) ISSUED INVITATION FOR
BIDS (IFB) NO. NTSB83-02 FOR DUPLICATING AND MAINTAINING COPIES OF
NTSB'S MICROFICHE ACCIDENT/INCIDENT FILES DATING FROM JANUARY 1, 1978,
INDEXING THEM AND RESPONDING TO PUBLIC REQUESTS FOR COPIES. THE
CONTRACT WAS TO COVER FISCAL YEAR (FY) 1983 WITH AN OPTION FOR FY 1984.
BIDDERS WERE REQUIRED TO SUBMIT BIDS FOR WHAT THEY WOULD CHARGE THE
PUBLIC FOR THESE SERVICES IN FY 1983 AND FY 1984. THE LOW BID WAS
DETERMINED BY MULTIPLYING THE UNIT PRICES FOR BOTH YEARS BY THE
ESTIMATED NUMBER OF REQUESTS.
THE NTSB RECEIVED BIDS FROM THE PROTESTER, PROFESSIONAL REPROGRAPHIC
SERVICES (PRS), AND CONTROLLED ENVIRONMENT SYSTEMS, INC. (CESI). CESI
WAS THE LOW BIDDER WITH A BID OF $296,851.50 FOR THE 2 YEARS -
$175,376.25 FOR FY 1983 AND $121,475.25 FOR FY 1984. PRS SUBMITTED A BID
FOR $423,000, $211,038 FOR FY 1983 AND $211,962 FOR FY 1984.
PRS NOW PROTESTS THAT CESI'S BID WAS UNBALANCED BETWEEN THE 2 YEARS
AND, THEREFORE, NONRESPONSIVE. WE DENY THE PROTEST.
THE QUESTION OF UNBALANCED BIDS IS RESOLVED USING A TWO-PART
ANALYSIS. FIRST, A BID IS MATHEMATICALLY UNBALANCED IF EACH ITEM OR
YEAR DOES NOT CARRY ITS PROPORTIONAL SHARE OF COST AND PROFIT. EMPIRE
ELECTRIC CO., INC., B-204911.2, NOVEMBER 3, 1981, 81-2 CPD 379. SECOND,
A MATHEMATICALLY UNBALANCED BID BECOMES MATERIALLY UNBALANCED WHEN AN
OVERALL ASSESSMENT OF THE BID RAISES DOUBT WHETHER IT WILL RESULT IN THE
LOWEST ULTIMATE COST TO THE GOVERNMENT. TWI, INCORPORATED, 61 COMP.GEN.
99 (1981), 81-2 CPD 424. ONLY IN CASES OF BOTH MATHEMATICAL AND
MATERIAL UNBALANCING WILL THE BID BE CONSIDERED NONRESPONSIVE. JIMMY'S
APPLIANCE, 61 COMP.GEN. 444 (1982), 82-1 CPD 542.
THE AGENCY STATES THAT THE CONTRACTOR WILL INCUR SUBSTANTIAL STARTUP
COSTS DURING THE FIRST YEAR OF THE CONTRACT. THE CONTRACTOR MUST
DUPLICATE ABOUT 5 YEARS OF MICROFICHE FILES AND INDEX THEM DURING THE
FIRST YEAR. THIS TASK WILL NOT RECUR DURING THE OPTION YEAR. ALTHOUGH
WE REALIZE THAT THE PROTESTER'S BID DOES NOT CONTAIN A SIMILAR COST
DIFFERENCE BETWEEN THE 2 YEARS, THE DIFFERENCE OF OVER $50,000 BETWEEN
CESI'S FY 1983 AND ITS FY 1984 BID MAY REASONABLY REFLECT THE DIFFERENCE
IN OPERATIONAL COSTS BETWEEN FY 1983 AND FY 1984.
IN THE PAST, WE HAVE CLOSELY SCRUTINIZED THE USE OF STARTUP COSTS AS
A JUSTIFICATION FOR FRONT-LOADING BIDS. LEAR SIEGLER, INC., B-205594.2,
JUNE 29, 1982, 82-1 CPD 632; SOLON AUTOMATED SERVICES, INC.,
B-206449.2, DECEMBER 20, 1982, 82-2 CPD 548. HOWEVER, STARTUP COSTS CAN
BE FACTORED INTO THE INITIAL BID PERIOD SO LONG AS THAT PERIOD REFLECTS
ITS PROPORTIONAL SHARE OF THE COST AND PROFIT. JIMMY'S APPLIANCE,
SUPRA.
EVEN IF WE HELD CESI'S BID TO BE UNBALANCED MATHEMATICALLY, THE FACTS
CLEARLY SHOW THAT AWARD TO CESI WILL RESULT IN THE LOWEST ULTIMATE COST
TO THE GOVERNMENT. CESI'S BID IS THE LOW BID THROUGHOUT THE CONTRACT
REGARDLESS OF WHETHER THE GOVERNMENT EXERCISES THE OPTION.
PROTEST DENIED.
B-210604, AUG 24, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
EMPLOYEE RETAINED ATTORNEY TO FACILITATE TRANSFER
OF MARKETABLE TITLE WHEN SELLER'S DEATH PRIOR TO
CLOSING RESULTED IN REVERSION OF PROPERTY BEING
PURCHASED TO A TRUST AND SUBJECTED IT TO CLAIMS
FOR DEATH-RELATED TAXES AND CONSTRUCTION LIENS.
SINCE SERVICES WERE NECESSARY TO THE TRANSFER OF
TITLE AND CUSTOMARILY PAID FOR BY THE PURCHASER
WITHIN THE MEANING OF MATTER OF LAY, 56 COMP.GEN. 561
(1977), FEES MAY BE REIMBURSED INSOFAR
AS THE NUMBER OF HOURS BILLED IS REASONABLE FOR
THE PARTICULAR COMPLICATIONS INVOLVED AND THE
HOURLY RATE CHARGED IS WITHIN THE CUSTOMARY RANGE
OF CHARGES FOR SUCH SERVICES.
REID T. STONE:
THE ISSUE PRESENTED IN THIS CASE IS WHETHER REIMBURSEMENT OF ATTORNEY
FEES INCIDENT TO THE PURCHASE OF A RESIDENCE IS LIMITED BY WHAT IS
CUSTOMARY IN THE NORMAL TRANSACTION, OR WHETHER FEES INCURRED TO
FACILITATE THE TRANSFER OF MARKETABLE TITLE MAY BE REIMBURSED WHERE THE
PURCHASE TRANSACTION IS COMPLICATED BY THE SELLER'S DEATH PRIOR TO
CLOSING.
MR. REID T. STONE, AN EMPLOYEE OF THE GEOLOGICAL SURVEY, UNITED
STATES DEPARTMENT OF THE INTERIOR, WAS TRANSFERRED FROM MENLO PARK TO
LOS ANGELES, CALIFORNIA, BY A TRAVEL AUTHORIZATION DATED SEPTEMBER 20,
1981. IN DECEMBER 1981, THE EMPLOYEE MADE AN OFFER TO PURCHASE A UNIT
IN A RESIDENTIAL BUILDING WHICH WAS UNDER CONSTRUCTION. AS NO REAL
ESTATE AGENTS WERE INVOLVED, HE OBTAINED THE SERVICES OF AN ATTORNEY TO
DRAFT A PURCHASE OFFER AND RENDER RELATED SERVICES. HE HAS BEEN
REIMBURSED $285 FOR THESE PARTICULAR LEGAL FEES.
BEFORE THE TRANSACTION WAS COMPLETED, HOWEVER, ONE OF THE SELLERS
DIED AND THE EMPLOYEE INCURRED ADDITIONAL ATTORNEY FEES FOR RESEARCH,
NEGOTIATIONS AND DRAFTING OF ADDITIONAL DOCUMENTS. THE ADDITIONAL LEGAL
WORK WAS NECESSITATED BY TITLE COMPLICATIONS THAT RESULTED FROM THE FACT
THAT THE PROPERTY, WHICH REVERTED TO A TRUST, BECAME SUBJECT TO CLAIMS
FOR ESTATE AND INHERITANCE TAXES. ALSO COMPLICATIONS AROSE AS A RESULT
OF CONSTRUCTION AND MATERIALS LIENS. THE BILL SUBMITTED BY THE ATTORNEY
IS FOR 23.70 HOURS OF WORK AT $150 PER HOUR.
THE AGENCY HAS REQUESTED AN ADVANCE DECISION REGARDING REIMBURSEMENT
OF THESE FEES SINCE MOST OF THE LEGAL EXPENSES WERE INCURRED AS A RESULT
OF THE DEATH OF THE SELLER AND THE LEGAL DOCUMENTS AND SERVICES REQUIRED
BY MR. STONE ARE NOT TYPICALLY REQUIRED IN CONNECTION WITH THE PURCHASE
OF A RESIDENCE.
UNDER 5 U.S.C. SEC. 5724(A)(4) (1976) A TRANSFERRED EMPLOYEE MAY BE
REIMBURSED FOR THE EXPENSES OF SELLING A RESIDENCE AT HIS OLD STATION
AND OF PURCHASING A HOME AT HIS NEW OFFICIAL STATION, AS LONG AS THE
EXPENSES DO NOT EXCEED THOSE CUSTOMARILY CHARGED IN THE LOCALITY WHERE
THE RESIDENCE IS LOCATED. PARAGRAPH 2-6.2C OF THE FEDERAL TRAVEL
REGULATIONS (FPMR 101-7, MAY 1973) (FTR) MAKES BROAD PROVISION FOR THE
PAYMENT OF LEGAL FEES, NOT INCLUDING FEES FOR LITIGATION, WHICH ARE
CUSTOMARILY PAID BY THE PURCHASER OF A RESIDENCE AT THE NEW DUTY
STATION, PROVIDED THEY DO NOT EXCEED AMOUNTS CHARGED IN THE LOCALITY OF
THE NEW RESIDENCE. PARA. 2-6.2G OF THE FTR LIMITS EXPENSES THAT MAY BE
REIMBURSED IN CONNECTION WITH THE PURCHASE OF A RESIDENCE TO 5 PERCENT
OF THE PURCHASE PRICE OR $4,000, WHICH EVER IS LESS.
WE NOTED IN MATTER OF LAY, 56 COMP.GEN. 561 (1977), THAT IT IS NOT
ONLY PRUDENT BUT CUSTOMARY TO OBTAIN NECESSARY AND REASONABLE LEGAL
SERVICES INCIDENT TO THE PURCHASE OR SALE OF A RESIDENCE. ACCORDINGLY,
WE HELD THAT NECESSARY AND REASONABLE LEGAL COSTS AND FEES, EXCEPT FOR
THE FEES AND COSTS OF LITIGATION, INCURRED BY REASON OF THE PURCHASE OR
SALE OF A RESIDENCE INCIDENT TO A PERMANENT CHANGE OF STATION MAY BE
REIMBURSED PROVIDED THAT THE COSTS ARE WITHIN THE CUSTOMARY RANGE OF
CHARGES FOR SUCH SERVICES WITHIN THE LOCALITY OF THE RESIDENCE
TRANSACTION. THE QUESTION OF WHETHER LEGAL FEES WERE NECESSARILY
INCURRED WAS ADDRESSED IN MATTER OF SIMONSKI, B-193945, APRIL 29, 1980.
IN THAT CASE, THE EMPLOYEE'S SALE OF HIS RESIDENCE WAS COMPLICATED BY
THE FACT THAT A STRUCTURE ON THE PROPERTY BEING SOLD WAS ENCROACHING ON
AN ADJACENT LOT. FINDING THAT THE ENCROACHMENT RAISED QUESTIONS
CONCERNING THE MARKETABILITY OF HIS TITLE, WE HELD THAT THE EMPLOYEE
NECESSARILY INCURRED ADDITIONAL LEGAL FEES FOR REDRAFTING OF DOCUMENTS
AS WELL AS NEGOTIATIONS WITH THE PURCHASER AND THE OWNER OF THE ADJACENT
PARCEL TO ESTABLISH MARKETABLE TITLE AND COMPLETE THE SALE. AS A MEASURE
FOR DETERMINING WHETHER THE COSTS INCURRED WERE WITHIN THE CUSTOMARY
RANGE OF CHARGES FOR THE SERVICES RENDERED WE CONSIDERED THE CUSTOMARY
RANGE OF CHARGES FOR A "LAND SALE CONTRACT INVOLVING AN ENCROACHMENT."
WHILE IT IS ORDINARILY THE SELLER'S OBLIGATION TO CONVEY MARKETABLE
TITLE, WE HAVE RECOGNIZED THAT IT MAY BE NECESSARY FOR THE PURCHASER AS
WELL TO OBTAIN LEGAL SERVICES TO ASSURE GOOD AND MARKETABLE TITLE TO THE
PROPERTY. WHERE FINANCING WAS DEPENDENT UPON THE RESOLUTION OF TITLE
COMPLICATIONS WE ALLOWED REIMBURSEMENT TO THE PURCHASER FOR A $300 LEGAL
FEE PAID FOR THAT PURPOSE. MATTER OF PETRO, B-183160, NOVEMBER 17,
1975.
ACCORDINGLY, THE ATTORNEY FEE IN QUESTION MAY BE REIMBURSED TO THE
EXTENT THE AGENCY DETERMINES THAT IT DOES NOT EXCEED THE LEGAL FEES
WHICH WOULD NORMALLY BE CHARGED IN THE AREA CONCERNED FOR THE SERVICES
RENDERED. IN THAT CONNECTION THE LOCAL OFFICE OF THE DEPARTMENT OF
HOUSING AND URBAN DEVELOPMENT CAN OFTEN GIVE AN AGENCY ADVICE AS TO
WHETHER THE NUMBER OF HOURS BILLED IS REASONABLE CONSIDERING THE TITLE
COMPLICATIONS INVOLVED AND AS TO WHETHER THE ATTORNEY'S HOURLY RATE IS
WITHIN THE CUSTOMARY RANGE OF CHARGES FOR SUCH WORK. ALSO, THE TOTAL
REIMBURSEMENT ALLOWED FOR PURCHASE OF THIS RESIDENCE MAY IN NO CASE
EXCEED THE MAXIMUM PRESCRIBED BY REGULATION.
B-210603 L/M, FEB 25, 1983
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
TED STEVENS, UNITED STATES SENATE:
IN YOUR LETTER OF JANUARY 6, 1983, YOU ASKED WHETHER THE FIXED-PRICE
INCENTIVE CONTRACT RECENTLY AWARDED BY THE NAVY TO NEWPORT NEWS
SHIPBUILDING AND DRY DOCK COMPANY FOR CONSTRUCTION OF TWO NIMITZ CLASS
AIRCRAFT CARRIERS (CVN-72 AND 73) WAS IN COMPLIANCE WITH THE JOINT
RESOLUTION OF DECEMBER 21, 1982, PUB.L. NO. 97-377, 96 STAT. 1831. THE
RESOLUTION, IN SECTION 101(C), APPROPRIATED $6,559,500,000 FOR THE
CONSTRUCTION OF THE CARRIERS, WITH THE RESTRICTION THAT THE MONEY BE
AVAILABLE "ONLY UNDER A FIRM, FIXED PRICE TYPE CONTRACT." 96 STAT AT
1842. DUE TO THE TIME CONSTRAINTS IMPOSED BY YOUR LETTER WE DID NOT
REQUEST FORMAL COMMENTS FROM THE DEPARTMENT OF THE NAVY. HOWEVER, WE
HAVE SPOKEN INFORMALLY WITH NAVY OFFICIALS. FOR THE REASONS GIVEN
BELOW, WE THINK THE CONTRACT CONSISTENT WITH THE QUOTED RESTRICTION.
THE CONTRACT
ON DECEMBER 27, 1982, IN AN ATTEMPT TO COMPLY WITH THE APPROPRIATION
RESTRICTION, THE NAVY AND NEWPORT NEWS SHIPBUILDING MODIFIED A PRIOR
AGREEMENT REGARDING THE CVN-72 AND 73, AND ENTERED INTO A FIXED-PRICE
INCENTIVE CONTRACT FOR THE CONSTRUCTION OF THE CARRIERS. THE CONTRACT
PROVIDED FOR A TOTAL CONTRACT TARGET COST OF $2.54 BILLION, A TARGET
PROFIT OF $603 MILLION, A TARGET PRICE OF $3.143 BILLION AND A CEILING
PRICE OF $3.4544 BILLION. UNDER SCHEDULE H-4 OF THE CONTRACT, NEWPORT
NEWS' PROFIT IS RELATED TO THE TOTAL FINAL COST AS FOLLOWS: IF THE
FINAL COST IS EQUAL TO THE TARGET COST, NEWPORT NEWS IS PAID THE TOTAL
TARGET PROFIT; IF THE FINAL COST IS GREATER THAN THE TARGET COST
NEWPORT NEWS IS PAID THE TARGET PROFIT LESS 25 PERCENT OF THE AMOUNT BY
WHICH THE FINAL COST EXCEEDS THE TARGET COST; AND, IF THE FINAL COST IS
LESS THAN THE TARGET COST, NEWPORT NEWS IS PAID THE TARGET PROFIT PLUS
25 PERCENT OF THE AMOUNT BY WHICH THE FINAL COST IS LESS THAN THE TARGET
COST. HOWEVER, IN NO EVENT MAY THE FINAL TOTAL PRICE OF THE CONTRACT
EXCEED THE CEILING PRICE.
LEGISLATIVE HISTORY
THE LEGISLATIVE HISTORY OF THE DEPARTMENT OF DEFENSE APPROPRIATIONS
FOR FISCAL YEAR 1983 GIVES NO INDICATION OF WHY THE CONGRESS IMPOSED THE
RESTRICTION THAT CONSTRUCTION OF THE CARRIERS MUST BE ACCOMPLISHED UNDER
A FIRM, FIXED-PRICE TYPE CONTRACT. THE RESTRICTION FIRST APPEARED AS A
PROVISO TO THE CVN APPROPRIATION IN S. 2951, 97TH CONG., THE SENATE
VERSION OF THE DEPARTMENT OF DEFENSE APPROPRIATION ACT, 1983. NEITHER
THE COMMITTEE REPORT ACCOMPANYING THE BILL (S.REPT. NO. 97-580, 97TH
CONG., 2D SESS.) NOR THE FLOOR DEBATE STATES ANY REASON FOR THE PROVISO.
THE HOUSE VERSION OF THE BILL, H.R. 7355, 97TH CONG., CONTAINED NO
SIMILAR PROVISION, BUT THE RESTRICTION WAS ADDED, AS A SENATE
APPROPRIATIONS COMMITTEE AMENDMENT, WHEN THE HOUSE BILL WAS PLACED ON
THE SENATE CALENDAR. WHEN THE COMMITTEE OF CONFERENCE ON THE CONTINUING
RESOLUTION INCORPORATED THE DEFENSE APPROPRIATIONS ACT, IT INCLUDED THE
RESTRICTION, BUT, AGAIN, WITHOUT ANY EXPLANATION.
WE HAVE BEEN ADVISED INFORMALLY BY NAVY OFFICIALS THAT THE
RESTRICTION WAS ADDED AS A COST SAVINGS MEASURE IN RESPONSE TO
EXPERIENCES WITH EARLIER CARRIER PROCUREMENT. THEY SUGGESTED THAT
FUNDING PROBLEMS AROSE WITH THE CVN-70 BECAUSE INITIALLY THE WORK WAS
DONE ON A COST REIMBURSABLE BASIS UNDER A LETTER CONTRACT RATHER THAN
UNDER A CONTRACT FIRMLY FIXING THE RIGHTS AND LIABILITIES OF THE
PARTIES. THIS RESULTED IN A PERIOD OF UNCERTAINTY ABOUT THE COST. THE
NAVY OFFICIALS ALSO TOLD US THAT THEY INTERPRET THE WORD "FIRM" IN THE
RESTRICTION ONLY AS REQUIRING A CONTRACT THAT IS FIRM OR DEFINITE, BUT
NOT THE PARTICULAR KIND OF CONTRACT KNOWN AS A "FIRM FIXED-PRICE
CONTRACT." THESE OFFICIALS ALSO EXPLAINED THAT A STRICT FIRM FIXED-PRICE
CONTRACT WOULD BE IMPRACTICAL FOR A LONG-TERM SHIPBUILDING PROJECT.
DISCUSSION
THE RESTRICTION REQUIRES THAT THE CARRIERS BE BUILT UNDER A "FIRM,
FIXED-PRICE TYPE CONTRACT." IN OUR OPINION, THIS PHRASE MAY BE
INTERPRETED AS THE NAVY HAS INTERPRETED IT, I.E., TO REQUIRE ONLY THAT A
FIXED-PRICE TYPE CONTRACT BE USED AND TO PRECLUDE THE INCURRENCE OF
ESSENTIALLY UNCONTROLLABLE COSTS UNDER PRELIMINARY CONTRACTUAL
ARRANGEMENTS SUCH AS LETTER CONTRACTS. THUS, THE USE OF THE COMMA
INDICATES THAT THE WORD "FIRM" AND THE PHRASE "FIXED-PRICE TYPE" ARE
EQUAL OR COORDINATE MODIFIERS OF THE WORD "CONTRACT." SEE GOVERNMENT
PRINTING OFFICE STYLE MANUAL SEC. 8.39 (1973). IN OTHER WORDS, IN ORDER
TO COMPLY WITH THE RESTRICTION, THE CONSTRUCTION CONTRACT MUST BE BOTH
"FIRM" AND OF A "FIXED-PRICE TYPE." BY USING THE WORD "FIRM", WE
THEREFORE THINK IT PLAUSIBLE, PARTICULARLY IN THE ABSENCE OF RELEVANT
LEGISLATIVE HISTORY, THAT THE CONGRESS INTENDED A CONTRACT IN WHICH THE
RESPECTIVE RESPONSIBILITIES OF THE PARTIES ARE COMPLETELY AND
DEFINITIVELY SET OUT. THE PROVISION IS THEREFORE SUSCEPTIBLE OF NAVY'S
INTERPRETATION, I.E., THAT THE CONGRESS MEANT TO EXCLUDE THE USE OF A
LETTER CONTRACT, WHICH IN THE CASE OF THE CVN-70 HAD ALLOWED THE
CONTRACTOR TO OPERATE FOR SEVERAL YEARS WITHOUT ANY EFFECTIVE CONTROLS
ON COSTS.
THE CONTRACT BETWEEN THE NAVY AND NEWPORT NEWS IS FIRM IN THAT SENSE.
IT REQUIRES NEWPORT NEWS TO DELIVER THE TWO VESSELS AND RELATED PARTS
BY SPECIFIED DATES. IT SETS FORTH IN DEFINITE FIGURES THE TARGET COST,
TARGET PROFIT, TARGET PRICE, AND CEILING PRICE, AND ESTABLISHES THE
FORMULA BY WHICH THE TOTAL FINAL PRICE TO BE PAID BY THE UNITED STATES
IS TO BE CALCULATED.
SECTION 3-404.1 OF THE DEFENSE ACQUISITION REGULATION DESCRIBES
FIXED-PRICE CONTRACTS, AS FOLLOWS:
"FIXED-PRICE CONTRACTS ARE OF SEVERAL TYPES SO
DESIGNED AS TO FACILITATE PROPER PRICING UNDER VARYING
CIRCUMSTANCES. THE FIXED-PRICE TYPE CONTRACTS PROVIDE
FOR A FIRM PRICE, OR UNDER APPROPRIATE CIRCUMSTANCES
MAY PROVIDE FOR AN ADJUSTABLE PRICE ***." ONE TYPE OF FIXED-PRICE
CONTRACT DESCRIBED BY THE REGULATION IS THE "FIXED-PRICE INCENTIVE
CONTRACT." A "FIXED-PRICE INCENTIVE CONTRACT" IS DEFINED AS:
"*** A FIXED-PRICE TYPE OF CONTRACT WITH PROVISION
FOR ADJUSTMENT OF PROFIT AND ESTABLISHMENT OF THE FINAL
CONTRACT PRICE BY A FORMULA BASED ON THE RELATIONSHIP
WHICH FINAL NEGOTIATED TOTAL COST BEARS TO TOTAL TARGET
COSTS." ID. SEC. 3-404.4. THE DESCRIBED CONTRACT BETWEEN THE NAVY AND
NEWPORT NEWS IS SUCH A FIXED-PRICE INCENTIVE CONTRACT, AND IS THEREFORE
A FIXED-PRICE TYPE CONTRACT.
THE GUIDANCE CONTAINED IN THE DEFENSE ACQUISITION REGULATION
CONCERNING THE CIRCUMSTANCES UNDER WHICH FIRM FIXED-PRICE CONTRACTS ARE
SUITABLE FOR USE SUPPORTS THE NAVY'S ARGUMENT THAT A FIRM FIXED-PRICE
CONTRACT WOULD BE INAPPROPRIATE IN THESE CIRCUMSTANCES. DAR 3-404.2(B)
PROVIDES AS FOLLOWS IN THIS REGARD:
"(B) APPLICATION. THE FIRM FIXED-PRICE
CONTRACT IS SUITABLE FOR USE IN PROCUREMENTS WHEN
REASONABLY DEFINITE DESIGN OR PERFORMANCE
SPECIFICATIONS ARE AVAILABLE AND WHENEVER FAIR AND
REASONABLE PRICES CAN BE ESTABLISHED AT THE OUTSET,
SUCH AS WHERE:
"(I) ADEQUATE COMPETITION HAS MADE INITIAL
PROPOSALS EFFECTIVE;
"(II) PRIOR PURCHASES OF THE SAME OR SIMILAR
SUPPLIES OR SERVICES UNDER COMPETITIVE
CONDITIONS, OR SUPPORTED BY VALID COST OR
PRICING DATA, PROVIDE REASONABLE PRICE COMPARISONS;
"(III) COST OR PRICING INFORMATION IS AVAILABLE
PERMITTING THE DEVELOPMENT OF REALISTIC
ESTIMATES OF THE PROBABLE COSTS OF
PERFORMANCE;
"(IV) THE UNCERTAINTIES INVOLVED IN CONTRACT
PERFORMANCE CAN BE IDENTIFIED AND
REASONABLE ESTIMATES OF THEIR POSSIBLE
IMPACT ON COSTS MADE, AND THE CONTRACTOR
IS WILLING TO ACCEPT A FIRM FIXED PRICE
AT A LEVEL WHICH REPRESENTS ASSUMPTION OF
A REASONABLE PROPORTION OF THE RISKS INVOLVED; OR
"(V) ANY OTHER REASONABLE BASIS FOR PRICING
CAN BE USED CONSISTENT WITH THE PURPOSE
OF THIS TYPE OF CONTRACT.
"THE FIRM FIXED-PRICE CONTRACT IS PARTICULARLY SUITABLE
IN THE PURCHASE OF STANDARD OR MODIFIED COMMERCIAL ITEMS,
OR MILITARY ITEMS FOR WHICH SOUND PRICES CAN BE DEVELOPED." DAR
3-404.4(B), ON THE OTHER HAND, STATES AS FOLLOWS WITH RESPECT TO
FIXED-PRICE INCENTIVE CONTRACTS:
"FIXED-PRICE INCENTIVE CONTRACTS ARE APPROPRIATE
WHEN USE OF THE FIRM FIXED-PRICE CONTRACT IS
INAPPROPRIATE, AND THE SUPPLIES OR SERVICES BEING
PROCURED ARE OF SUCH A NATURE THAT ASSUMPTION OF A
DEGREE OF COST RESPONSIBILITY BY THE CONTRACTOR IS
LIKELY TO PROVIDE HIM WITH A POSITIVE PROFIT
INCENTIVE FOR EFFECTIVE COST CONTROL AND CONTRACT
PERFORMANCE." PARAGRAPH 3-404.4(C) PROVIDES THAT:
"*** NEITHER TYPE OF FIXED-PRICE INCENTIVE
CONTRACT SHALL BE USED UNLESS A DETERMINATION HAS
BEEN MADE, IN ACCORDANCE WITH THE REQUIREMENTS OF
PART 3 OF THIS SECTION III THAT:
"(I) SUCH METHOD OF CONTRACTING IS LIKELY TO BE
LESS COSTLY THAN OTHER METHODS, OR
"(II) IT IS IMPRACTICAL TO SECURE SUPPLIES OR
SERVICES OF THE KIND OR QUALITY REQUIRED WITHOUT
THE USE OF SUCH TYPE OF CONTRACT."
IT IS OUR OPINION FOR THE REASONS DISCUSSED ABOVE THAT THE LIMITATION
AS TO CONTRACT TYPE CONTAINED IN THE CONTINUING RESOLUTION MAY BE
INTERPRETED TO ALLOW NAVY THE FLEXIBILITY CONTEMPLATED BY THE QUOTED DAR
PROVISIONS IN DETERMINING THE APPROPRIATE TYPE OF FIXED-PRICE CONTRACT
FOR THIS PROCUREMENT.
ACCORDINGLY, WE CONCLUDE THAT THE FIXED-PRICE INCENTIVE CONTRACT
AWARDED BY THE NAVY TO NEWPORT NEWS SHIPBUILDING FOR CONSTRUCTION OF THE
TWO NIMITZ CARRIERS COMPLIES WITH THE RESTRICTION IN THE CONTINUING
RESOLUTION.
WE HOPE WE HAVE BEEN OF ASSISTANCE.
B-210601, MAR 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
BID SENT BY FEDERAL EXPRESS WHICH WAS RECEIVED AT THE OFFICE
DESIGNATED IN THE IFB AFTER THE TIME SPECIFIED IN THE IFB MUST BE
REJECTED.
FUTURE TECH:
FUTURE TECH PROTESTS AGAINST THE REJECTION OF ITS BID AS LATE UNDER
INVITATION FOR BIDS (IFB) DE-FB01-83MA32207 ISSUED BY THE DEPARTMENT OF
ENERGY (DOE).
WE HAVE DECIDED THE PROTEST WITHOUT OBTAINING A FORMAL AGENCY REPORT,
SINCE IT IS CLEAR THAT THE PROTESTER HAS NO CHANCE OF SUCCESS ON THE
MERITS AND THE REPORT WOULD SERVE NO USEFUL PURPOSE. DOT SYSTEMS, INC.,
B-208420, SEPTEMBER 21, 1982, 82-2 CPD 253.
THE IFB REQUIRED BIDS TO BE DELIVERED TO ROOM 1J005 BY 10:30 A.M., ON
JANUARY 20, 1983. THE IFB STATED THAT, IF THE BID IS DELIVERED BY OTHER
THAN MAIL, THE BIDDER ASSUMES FULL RESPONSIBILITY OF INSURING THAT THE
BID IS RECEIVED AT THE PLACE AND BY THE DATE AND TIME SPECIFIED IN THE
IFB.
FUTURE TECH USED FEDERAL EXPRESS TO DELIVER THE BID. INSTEAD OF
DELIVERING THE BID TO ROOM 1J005, FEDERAL EXPRESS DELIVERED THE BID TO
THE DOE LOADING DOCK AT 10:27 A.M., ON JANUARY 20. THE BID WAS
DELIVERED FROM THE LOADING DOCK TO ROOM 1J005 BY DOE. THE BID ARRIVED
AT ROOM 1J005 AFTER THE 10:30 A.M. DEADLINE.
WE HAVE HELD REPEATEDLY THAT AN OFFER DELIVERED TO A CONTRACTING
AGENCY LOADING DOCK BY FEDERAL EXPRESS OR OTHER COMMERCIAL CARRIER MUST
BE REJECTED IF IT ARRIVES LATE AT THE OFFICE DESIGNATED IN THE
SOLICITATION. GENERAL ATOMIC COMPANY, B-202165, MAY 27, 1981, 81-1 CPD
415; P.O.B., INC., B-200538, OCTOBER 14, 1980, 80-2 CPD 277; SOUTHERN
OREGON AGGREGATE, INC., B-190159, DECEMBER 16, 1977, 77-2 CPD 477;
DAYMAR, INC., B-188701, AUGUST 8, 1977, 77-2 CPD 88; GREER HYDRAULICS,
INC., B-182826, APRIL 22, 1975, 75-1 CPD 249; FEDERAL CONTRACTING
CORP., TAYLOR AIR SYSTEMS, INC., 54 COMP.GEN. 304 (1974), 74-2 CPD 229.
B-210601, MAR 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
BID SENT BY FEDERAL EXPRESS WHICH WAS RECEIVED AT THE OFFICE
DESIGNATED IN THE IFB AFTER THE TIME SPECIFIED IN THE IFB MUST BE
REJECTED.
FUTURE TECH:
FUTURE TECH PROTESTS AGAINST THE REJECTION OF ITS BID AS LATE UNDER
INVITATION FOR BIDS (IFB) DE-FB01-83MA32207 ISSUED BY THE DEPARTMENT OF
ENERGY (DOE).
WE HAVE DECIDED THE PROTEST WITHOUT OBTAINING A FORMAL AGENCY REPORT,
SINCE IT IS CLEAR THAT THE PROTESTER HAS NO CHANCE OF SUCCESS ON THE
MERITS AND THE REPORT WOULD SERVE NO USEFUL PURPOSE. DOT SYSTEMS, INC.,
B-208420, SEPTEMBER 21, 1982, 82-2 CPD 253.
THE IFB REQUIRED BIDS TO BE DELIVERED TO ROOM 1J005 BY 10:30 A.M., ON
JANUARY 20, 1983. THE IFB STATED THAT, IF THE BID IS DELIVERED BY OTHER
THAN MAIL, THE BIDDER ASSUMES FULL RESPONSIBILITY OF INSURING THAT THE
BID IS RECEIVED AT THE PLACE AND BY THE DATE AND TIME SPECIFIED IN THE
IFB.
FUTURE TECH USED FEDERAL EXPRESS TO DELIVER THE BID. INSTEAD OF
DELIVERING THE BID TO ROOM 1J005, FEDERAL EXPRESS DELIVERED THE BID TO
THE DOE LOADING DOCK AT 10:27 A.M., ON JANUARY 20. THE BID WAS
DELIVERED FROM THE LOADING DOCK TO ROOM 1J005 BY DOE. THE BID ARRIVED
AT ROOM 1J005 AFTER THE 10:30 A.M. DEADLINE.
WE HAVE HELD REPEATEDLY THAT AN OFFER DELIVERED TO A CONTRACTING
AGENCY LOADING DOCK BY FEDERAL EXPRESS OR OTHER COMMERCIAL CARRIER MUST
BE REJECTED IF IT ARRIVES LATE AT THE OFFICE DESIGNATED IN THE
SOLICITATION. GENERAL ATOMIC COMPANY, B-202165, MAY 27, 1981, 81-1 CPD
415; P.O.B., INC., B-200538, OCTOBER 14, 1980, 80-2 CPD 277; SOUTHERN
OREGON AGGREGATE, INC., B-190159, DECEMBER 16, 1977, 77-2 CPD 477;
DAYMAR, INC., B-188701, AUGUST 8, 1977, 77-2 CPD 88; GREER HYDRAULICS,
INC., B-182826, APRIL 22, 1975, 75-1 CPD 249; FEDERAL CONTRACTING
CORP., TAYLOR AIR SYSTEMS, INC., 54 COMP.GEN. 304 (1974), 74-2 CPD 229.
B-210596 L/M, FEB 1, 1983
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
JOSEPH P. ADDABBO, HOUSE OF REPRESENTATIVES:
AS YOU KNOW, ON OCTOBER 25, 1982, THE DEPARTMENT OF THE ARMY
EXERCISED A CONTRACT OPTION WITH THE MARTIN MARIETTA CORPORATION FOR THE
PRODUCTION OF 91 PERSHING II SURFACE TO SURFACE MISSILE SYSTEMS AND
ASSOCIATED GROUND SUPPORT EQUIPMENT. APPROXIMATELY $432 MILLION IN
FISCAL YEAR 1983 FUNDS WERE OBLIGATED FOR THIS PROCUREMENT. THE HOUSE
SURVEYS AND INVESTIGATIONS STAFF HAS BEEN STUDYING THE PROPRIETY OF THIS
COMMITMENT AT THE TIME IT WAS MADE, AND, EVEN IF PROPER, WHETHER THE
CONTRACT SHOULD HAVE BEEN TERMINATED IN LIGHT OF LATER COMMITTEE REPORTS
STATING THAT NONE OF ARMY'S APPROPRIATION FOR MISSILES SHOULD BE SPENT
FOR PROCUREMENT OF PERSHING II MISSILES IN FY 1983.
AFTER MEETING WITH HOUSE STAFF LAST FRIDAY, MY STAFF WAS ASKED
WHETHER THE ARMY WAS LEGALLY ENTITLED TO OBLIGATE FUNDS FOR THE PERSHING
II MISSILE LAST OCTOBER, AND WHETHER THERE IS A SOURCE OF FUNDS LEGALLY
AVAILABLE TO THE ARMY TO LIQUIDATE THE OBLIGATION. WE CONCLUDE THAT
THERE WAS NO LEGAL IMPEDIMENT TO INCURRING THE OBLIGATION, AND THAT
FUNDS PROVIDED IN ITS LUMP SUM APPROPRIATION FOR "MISSILE PROCUREMENT,
ARMY" IN THE 1983 DEPARTMENT OF DEFENSE APPROPRIATION BILL, INCORPORATED
AS PART OF THE SECOND CONTINUING RESOLUTION, ARE LEGALLY AVAILABLE TO
LIQUIDATE THE OBLIGATION.
WE HAVE USED THE WORDS "LEGAL" AND "LEGALLY" BECAUSE THIS OFFICE HAS
NEVER SUGGESTED IN ANY OF ITS DECISIONS THAT AN AGENCY OR DEPARTMENT MAY
IGNORE, WITH IMPUNITY, THE KNOWN WISHES OF CONGRESSIONAL COMMITTEES.
(SEE, FOR EXAMPLE, MATTER OF LTV AEROSPACE CORPORATION, 55 COMP.GEN.
307, 325 (1975), QUOTED INFRA.) WE EXPRESS NO OPINION ON WHETHER THIS
WAS SUCH A SITUATION, NOR ARE WE TAKING ANY POSITION ON THE WISDOM OF
THE PROCUREMENT ITSELF.
LEGALITY OF THE PERSHING II OBLIGATION
THE DEPARTMENT OF THE ARMY CONTRACTED WITH THE MARTIN MARIETTA
CORPORATION FOR THE PRODUCTION OF 21 PERSHING II MISSILES IN JULY, 1982.
THAT CONTRACT OFFERED AN OPTION TO PROCURE ADDITIONAL MISSILES AT
SPECIFIED PRICES, PROVIDED THAT THE OPTION WAS EXERCISED NO LATER THAN 6
MONTHS BEFORE THE FIRST SCHEDULED DELIVERY OF THE 1982 MISSILES. SINCE
THE FIRST DELIVERY WAS SCHEDULED FOR APRIL, 1983, THE OPTION HAD TO BE
EXERCISED BY OCTOBER 31, 1982. ON OCTOBER 25, 1982, THE DEPARTMENT OF
THE ARMY EXERCISED THE OPTION TO PROCURE AN ADDITIONAL 91 PERSHING II
MISSILES.
AT THE TIME THAT THE ARMY EXERCISED THE OPTION FOR THE ADDITIONAL
MISSILES, THE FOLLOWING LEGISLATIVE AUTHORITIES WERE IN PLACE:
1. PUBLIC LAW 97-276, ENACTED OCTOBER 2, 1982,
WHICH WAS THE FIRST CONTINUING RESOLUTION FOR 1983; AND
2. S. 2951, THE SENATE VERSION OF THE DEPARTMENT
OF DEFENSE APPROPRIATION ACT, 1983, WHICH WAS REPORTED
TO THE SENATE ON SEPTEMBER 23, 1982.
THE FIRST CONTINUING RESOLUTION PROVIDED GENERALLY FOR "SUCH AMOUNTS
AS MAY BE NECESSARY" TO CONTINUE ACTIVITIES FUNDED AND CONDUCTED IN
FISCAL YEAR 1982. (SEE SECTION 101(C).) THE SENATE VERSION OF THE DOD
APPROPRIATION ACT (S. 2951) WAS INCORPORATED INTO THE CONTINUING
RESOLUTION AS A PART OF PUB.L. 97-276 TO SERVE AS A REFERENCE FOR
DETERMINING APPROPRIATION OR FUNDING CEILINGS FOR SPECIFIC PROJECTS AND
ACTIVITIES. ALTHOUGH THE LAW STATED THAT THE DOD APPROPRIATION BILL AS
REPORTED SUBSEQUENTLY TO THE HOUSE WAS TO BE USED AS A REFERENCE INSTEAD
IF ITS APPROPRIATION OR FUNDING CEILINGS WERE LOWER THAN THE SENATE
BILL'S, AS OF OCTOBER 25, 1982, NO HOUSE BILL HAD BEEN REPORTED. THE
SENATE BILL WAS TABLED, IN RECOGNITION OF THE FACT THAT THE HOUSE HAD
NOT YET ACTED. NEVERTHELESS, THE REFERENCE IN THE FIRST CONTINUING
RESOLUTION WAS TO THE BILL AS REPORTED TO THE SENATE; NOT TO THE BILL
AS PASSED BY THE SENATE. THEREFORE, THE FUNDING AUTHORITY CONTAINED IN
THE SENATE BILL WAS AVAILABLE TO THE ARMY FOR OBLIGATION ON OCTOBER 25,
1982.
UNDER THE HEADING, "MISSILE PROCUREMENT, ARMY," S. 2951 PROVIDED
$2,611,600,000 FOR
"CONSTRUCTION, PROCUREMENT, PRODUCTION, MODIFICATION, AND
MODERNIZATION OF MISSILES, EQUIPMENT, INCLUDING ORDNANCE,
GROUND HANDLING EQUIPMENT, SPARE PARTS, AND ACCESSORIES
THEREFOR; SPECIALIZED EQUIPMENT AND TRAINING DEVICES;
EXPANSION OF PUBLIC AND PRIVATE PLANTS, INCLUDING THE
LAND NECESSARY THEREFOR *** AND PROCUREMENT AND
INSTALLATION OF EQUIPMENT, APPLIANCES, AND MACHINE TOOLS
IN PUBLIC AND PRIVATE PLANTS; *** AND OTHER EXPENSES
NECESSARY FOR THE FOREGOING PURPOSES; ***" EXCEPT FOR THE AMOUNT OF
THE APPROPRIATION, THIS IS ESSENTIALLY THE SAME BUDGET AUTHORITY
PROVIDED BY THE CONGRESS IN FY 82, WHICH THE ARMY USED TO MAKE ITS FIRST
BUY OF 21 PERSHING II MISSILES.
NOWHERE IN S. 2951 IS THERE LANGUAGE RESTRICTING OR PRESCRIBING THE
KIND OF MISSILE THAT COULD BE ACQUIRED. IN FACT, IN THE SENATE REPORT
ACCOMPANYING S. 2951 (S.REPT. 97-580, SEPTEMBER 23, 1982, P. 73) THERE
IS A TABLE INDICATING THAT THE FULL AMOUNT OF THE BUDGET REQUEST -
$498,300,000 - FOR THE PERSHING II MISSILES WAS RECOMMENDED TO THE
SENATE FOR INCLUSION IN THE APPROPRIATION. THE ARMY EVIDENTLY RELIED ON
THIS EXPRESSION OF APPROVAL TO PROCEED WITH ITS PLANS FOR ACQUISITION OF
ADDITIONAL PERSHING II MISSILES.
BUT EVEN IF THE SENATE REPORT HAD NOT EXPLICITLY APPROVED THE AMOUNT
REQUESTED FOR PERSHING II MISSILES, THE LUMP SUM CHARACTER OF THE
APPROPRIATION ITSELF, AND THE ABSENCE OF ANY PROHIBITION OR RESTRICTION
ON THE KIND OF MISSILES THAT COULD BE PROCURED, EITHER IN THE
APPROPRIATION ITSELF OR IN THE APPLICABLE DOD APPROPRIATION
AUTHORIZATION ACT, MEAN THAT THE APPROPRIATION WAS AVAILABLE FOR ANY
PROCUREMENT THAT COULD REASONABLY BE CHARACTERIZED AS A "MISSILE." (THIS
POINT WILL BE DISCUSSED MORE FULLY LATER.)
THE FIRST CONTINUING RESOLUTION HAD TWO ADDITIONAL PROVISIONS OF
GENERAL APPLICABILITY TO ALL DOD APPROPRIATIONS WHICH MUST ALSO BE
CONSIDERED. SECTION 101(C) OF THE RESOLUTION APPROPRIATED MONEY TO
CONTINUE ACTIVITIES WHICH WERE CONDUCTED IN FISCAL YEAR 1982, FOR WHICH
PROVISION WAS MADE IN THE 1982 DOD APPROPRIATION ACT, AND FOR WHICH
APPROPRIATIONS, FUNDS, OR OTHER AUTHORITY WAS AVAILABLE DURING FISCAL
YEAR 1982. THE LAW ALSO CONTAINED A STANDARD PROVISO, FREQUENTLY
INCLUDED IN CONTINUING RESOLUTIONS, "THAT NO APPROPRIATION, OR FUND MADE
AVAILABLE OR AUTHORITY GRANTED PURSUANT TO THIS PARAGRAPH SHALL BE USED
TO INITIATE OR RESUME ANY PROJECT OR ACTIVITY FOR WHICH APPROPRIATIONS,
FUNDS, OR OTHER AUTHORITY WERE NOT AVAILABLE DURING FISCAL YEAR 1982:
***"
AT FIRST GLANCE, ALL THESE CONDITIONS APPEAR TO BE MET. AS MENTIONED
BEFORE, THE 1982 DEPARTMENT DEFENSE APPROPRIATION ACT APPROPRIATED A
LUMP SUM OF $2,131,200,000 FOR "MISSILE PROCUREMENT, ARMY," USING
VIRTUALLY THE SAME LANGUAGE AS WAS CONTAINED IN THE 1983 SENATE DOD
APPROPRIATION BILL. MOREOVER, THERE IS NO QUESTION THAT THE ARMY DID
CONTRACT FOR PRODUCTION OF PERSHING II MISSILES IN FISCAL YEAR 1982.
THE HOUSE COMMITTEE ON APPROPRIATIONS, HOWEVER, IN ITS REPORT ON THE
FIRST CONTINUING RESOLUTION, (H.REPT. 97-834, SEPTEMBER 16, 1982) HAS
GIVEN THE ABOVE QUOTED PROVISION A LITTLE DIFFERENT TWIST. (NEITHER THE
SENATE REPORT (S.REPT. 97-581, SEPTEMBER 23, 1982) NOR THE CONFERENCE
REPORT (CONF.REPT. 97-914, SEPTEMBER 30, 1982, DISCUSSED THIS PROVISO AT
ALL.)
THE HOUSE COMMITTEE STATED, AT PAGE 3:
"UNDER THIS PROVISION, IT IS THE COMMITTEE'S INTENT THAT
NO FUNDS SHOULD BE MADE AVAILABLE FOR NEW PROJECTS, NEW
ACTIVITIES, NEW BUDGET ACTIVITIES, NEW PROGRAM ELEMENTS,
NEW SUBPROJECTS WITHIN THE PROGRAM ELEMENTS, NEW PRODUCTION
OF ITEMS NOT FUNDED FOR PRODUCTION IN FISCAL YEAR 1982, OR
FOR THE INCREASE IN PRODUCTION RATES ABOVE THOSE SUSTAINED
WITH FISCAL YEAR 1982 FUNDS." IN OTHER WORDS, THE HOUSE BELIEVED THAT
IT WAS NOT ENOUGH THAT THE ACTIVITY WAS ACTUALLY CONDUCTED IN FISCAL
YEAR 1982 AND THAT BUDGET AUTHORITY WAS MADE AVAILABLE FOR THAT PURPOSE.
FOR THE FIRST TIME, IT INTERPRETED THE PROVISO AS REQUIRING THAT THE
SCOPE AND SIZE OF THE ACTIVITY IN FISCAL YEAR 1983 BE NO GREATER THAN
THE SCOPE AND SIZE OF THE SAME ACTIVITY IN FISCAL YEAR 1982.
THIS EXPLANATION IS NOT ENTIRELY CONSISTENT WITH THE LITERAL WORDS OF
THE STATUTE, QUOTED SUPRA, OR WITH THE INTERPRETATION OF SIMILARLY
WORDED PROVISIONS IN PRIOR CONTINUING RESOLUTIONS. NEVERTHELESS, THE
HOUSE REPORT CONTAINED THE ONLY INTERPRETATION OF THE PROVISO AVAILABLE,
AND MERITS SERIOUS CONSIDERATION. HAD THE FINAL VERSION OF THE FIRST
CONTINUING RESOLUTION CONTAINED THE SAME LEVEL OF FUNDS PROPOSED IN THE
HOUSE BILL, WE MIGHT HAVE COME TO THE CONCLUSION THAT TO THE EXTENT THAT
THE CONTRACT OPTION EXERCISED BY THE ARMY ON OCTOBER 25, 1982 WOULD
RAISE THE PRODUCTION RATE OF PERSHING II MISSILES FROM THE 1982 RATE OF
2.1 PER MONTH TO 5.7 PER MONTH FOR 1983, IT WAS UNAUTHORIZED.
BUT SECTION 101(C) OF THE FIRST CONTINUING RESOLUTION IN ITS ENACTED
FORM DIFFERED IN ONE IMPORTANT RESPECT FROM THE HOUSE BILL, WHICH THE
QUOTED PASSAGE FROM THE HOUSE REPORT WAS INTERPRETING. UNLIKE THE HOUSE
BILL, PUB.L. 97-276 PROVIDED AN INCREASE IN NEW OBLIGATIONAL AUTHORITY
FOR FISCAL YEAR 1983 AND DIRECTED THAT THE INCREASE BE DISTRIBUTED ON A
PRO RATA BASIS TO EACH APPROPRIATION ACCOUNT. NO EXPLANATION OF THE
PURPOSE OF THE INCREASE WAS PROVIDED. HOWEVER, IN THE LIGHT OF THIS
INCREASE, AND THE SEPTEMBER 23 SENATE REPORT ON THE DOD APPROPRIATION
BILL WHICH RECOMMENDED THE FULL AMOUNT REQUESTED FOR 91 NEW MISSILES, WE
ARE UNABLE TO ACCEPT THE HOUSE REQUIREMENT THAT PRODUCTION RATES BE KEPT
AT THE 1982 LEVEL AS BEING CONSISTENT WITH THE INTENT OF THE OVERALL
LANGUAGE OF THE FIRST CONTINUING RESOLUTION. WE THEREFORE CONCLUDE THAT
THE OBLIGATION TO ACQUIRE 91 NEW PERSHING II MISSILES WAS AUTHORIZED.
AVAILABILITY OF FUNDS TO LIQUIDATE THE PERSHING II OBLIGATION
ON NOVEMBER 30, 1982, THE HOUSE APPROPRIATIONS COMMITTEE REPORTED ITS
VERSION OF THE FY 1983 DEPARTMENT OF DEFENSE APPROPRIATION BILL TO THE
HOUSE. (H.R. 7355). IN ITS REPORT ACCOMPANYING H.R. 7355, (H.REPT.
97-943, AT PAGE 107) THE HOUSE COMMITTEE RECOMMENDED THAT NO PROCUREMENT
FUNDS BE PROVIDED FOR PERSHING II MISSILES AT THAT TIME, ALTHOUGH THE
FULL AMOUNT REQUESTED FOR FURTHER RESEARCH AND DEVELOPMENT OF THE
MISSILE WAS APPROVED. THE COMMITTEE AGREED TO RECONSIDER ITS
RECOMMENDATION IF THE ARMY COULD DEMONSTRATE THAT LATER TESTS SHOWED
THAT THE MISSILE COULD OPERATE SUCCESSFULLY.
ON DECEMBER 21, 1982, THE HOUSE AND SENATE PASSED THE SECOND
CONTINUING RESOLUTION, PUB.L. 97-377, WHICH EXTENDED NEW OBLIGATIONAL
AUTHORITY FOR DOD ACTIVITIES AND PROJECTS FOR THE BALANCE OF FISCAL YEAR
1983. THE CONFERENCE COMMITTEE'S VERSION OF THE DOD APPROPRIATION ACT,
1983, WAS INCORPORATED BY REFERENCE "TO BE EFFECTIVE AS IF IT HAD BEEN
ENACTED INTO LAW AS THE REGULAR APPROPRIATION ACT ***". ALTHOUGH THE
SENATE HAD ORIGINALLY PROPOSED AN APPROPRIATION OF $2.6 BILLION FOR
"MISSILE PROCUREMENT, ARMY," WHICH, ITS REPORT INDICATED, WAS TO INCLUDE
FULL FUNDING FOR PRODUCTION OF THE PERSHING II MISSILES, IT AGREED IN
CONFERENCE TO DELETE ALL FUNDS FOR THE PERSHING II ACQUISITIONS.
ACCORDINGLY, THE NET APPROPRIATION FOR MISSILE PROCUREMENTS WAS REDUCED
TO $2.2 BILLION.
THESE ACTIONS MAY WELL LEAVE THE CONTINUATION OF THE 1983 PRODUCTION
CONTRACT IN LIMBO, AS A MATTER OF POLICY AND SOUND RELATIONS WITH THE
CONGRESS. AS A MATTER OF LAW, HOWEVER, WE MUST CONCLUDE THAT THE FULL
AMOUNT OF THE $2.2 BILLION APPROPRIATION FOR MISSILE PROCUREMENT IS
AVAILABLE TO THE ARMY TO LIQUIDATE ITS COMMITMENT TO MARTIN MARIETTA, -
UNLESS, OF COURSE, THE ARMY SUBSEQUENTLY DECIDES TO TERMINATE THE
CONTRACT FOR THE CONVENIENCE OF THE GOVERNMENT, IN WHICH CASE PAYMENT OF
THE TERMINATION COSTS MAY BE MADE FROM THE MISSILE PROCUREMENT ACCOUNT.
JUST AS WAS TRUE UNDER THE FIRST CONTINUING RESOLUTION, THE DOD
APPROPRIATION BILL, INCORPORATED AS AN INTEGRAL PART OF THE SECOND
CONTINUING RESOLUTION, PROVIDES APPROPRIATIONS IN LUMP SUM FORM FOR
"MISSILE PROCUREMENT, ARMY." ALTHOUGH THE NET AMOUNT PROVIDED REFLECTS
THE DELETION OF THE REQUIRED FUNDS FOR THE PERSHING II MISSILE, THERE IS
ABSOLUTELY NO DIRECTIVE OR RESTRICTION IN THE LAW ITSELF THAT WOULD MAKE
THE NET AMOUNT UNAVAILABLE FOR PROCUREMENT OF A PARTICULAR TYPE OF
MISSILE. THIS OFFICE HAS LONG HELD THAT ONLY RESTRICTIONS OR DIRECTIVES
WHICH ARE MADE PART OF A CONGRESSIONAL ENACTMENT ARE BINDING ON THE
AGENCIES CONCERNED AS A MATTER OF LAW.
ONE OF OUR EARLY CASES ON THIS POINT WAS MATTER OF LTV AEROSPACE
CORPORATION, CITED EARLIER IN THIS OPINION. IT CONCERNED A BID PROTEST
BY LTV BECAUSE THE NAVY HAD AWARDED A $3 BILLION DOLLAR CONTRACT TO
MCDONNELL DOUGLAS CORPORATION TO DEVELOP A COMBAT FIGHTER AIRCRAFT
CALLED THE F-18. LTV CHALLENGED THE LEGALITY OF THE AWARD BECAUSE THE
LEGISLATIVE HISTORY OF THE APPROPRIATION FOR DEVELOPMENT OF THE
AIRCRAFT, INCLUDING EXPLICIT LANGUAGE IN THE CONFERENCE REPORT, MADE IT
VERY CLEAR THAT THE CONGRESS WISHED THE NAVY COMBAT FIGHTER TO BE A
DERIVATIVE OF A FIGHTER AIRCRAFT DESIGN PREVIOUSLY SELECTED BY THE AIR
FORCE. THE NAVY ARGUED THAT THE APPROPRIATION LANGUAGE ITSELF WAS IN
LUMP SUM FORM AND CONTAINED NO RESTRICTIONS OR DIRECTIVES WHATSOEVER ON
THE TYPE OF FIGHTER IT COULD DEVELOP. WE AGREED WITH THE NAVY, AND
HELD:
"ACCORDINGLY, IT IS OUR VIEW THAT WHEN CONGRESS MERELY
APPROPRIATES LUMP SUM AMOUNTS WITHOUT STATUTORILY
RESTRICTING WHAT CAN BE DONE WITH THOSE FUNDS, A CLEAR
INFERENCE ARISES THAT IT DOES NOT INTEND TO IMPOSE LEGALLY
BINDING RESTRICTIONS, AND INDICIA IN COMMITTEE REPORTS AND
OTHER LEGISLATIVE HISTORY AS TO HOW THE FUNDS SHOULD OR
ARE EXPECTED TO BE SPENT DO NOT ESTABLISH ANY LEGAL
REQUIREMENTS ON FEDERAL AGENCIES ***.
"AS OBSERVED ABOVE, THIS DOES NOT MEAN AGENCIES ARE FREE TO
IGNORE CLEARLY EXPRESSED LEGISLATIVE HISTORY APPLICABLE TO
THE USE OF APPROPRIATED FUNDS. THEY IGNORE SUCH EXPRESSIONS
CONGRESS. THE EXECUTIVE BRANCH - AS THE NAVY HAS
OF INTENT AT THE PERIL OF STRAINED RELATIONS WITH THE
CONGRESS. THE EXECUTIVE BRANCH - AS THE NAVY HAS
RECOGNIZED - HAS A PRACTICAL DUTY TO ABIDE BY SUCH
EXPRESSIONS. THIS DUTY, HOWEVER, MUST BE
UNDERSTOOD TO FALL SHORT OF A STATUTORY REQUIREMENT
GIVING RISE TO A LEGAL INFRACTION WHERE THERE
IS A FAILURE TO CARRY OUT THAT DUTY."
AT THIS WRITING, WE DO NOT KNOW WHAT DECISIONS WILL BE MADE ABOUT THE
CONTINUATION OF THE PERSHING II PRODUCTION CONTRACT. PRESUMABLY, IF
PRESENTLY SCHEDULED TEST FLIGHTS ARE SUCCESSFUL, THE ARMY WILL REQUEST A
SUPPLEMENTAL APPROPRIATION SUFFICIENT TO RESTORE THE FUNDS DELETED FROM
THE MISSILES PROCUREMENT ACCOUNT. IF THE SUPPLEMENTAL APPROPRIATIONS
REQUEST IS NOT GRANTED AND THE ARMY DOES NOT WISH TO TERMINATE THE
PERSHING II CONTRACT, IT WILL HAVE TO UTILIZE APPROPRIATIONS ORIGINALLY
PLANNED FOR PROCUREMENT OF OTHER MISSILES.
IN THIS REGARD, IT SHOULD BE NOTED THAT THE FIRST CONTINUING
RESOLUTION CONTAINS A STANDARD PROVISION (AT SECTION 104) THAT
"EXPENDITURES MADE PURSUANT TO THIS JOINT RESOLUTION SHALL
BE CHARGED TO THE APPLICABLE APPROPRIATION, FUND, OR
AUTHORIZATION WHENEVER A BILL IN WHICH SUCH APPLICABLE
APPROPRIATION, FUND, OR AUTHORIZATION IS CONTAINED IS
ENACTED INTO LAW." AS MENTIONED EARLIER, THE CONFERENCE COMMITTEE
VERSION OF THE DOD APPROPRIATION ACT OF FY 1983, PROVIDING A LUMP SUM
FOR MISSILE PROCUREMENT WITHOUT RESTRICTIONS IN THE LAW, WAS
INCORPORATED INTO THE SECOND CONTINUING RESOLUTION "TO BE EFFECTIVE AS
IF IT HAD BEEN ENACTED INTO LAW." THE OCTOBER 25 OBLIGATION IS THEREFORE
REQUIRED TO BE CHARGED TO THE 1983 MISSILE PROCUREMENT APPROPRIATION.
THERE IS THUS NO NEED FOR REPROGRAMMING OR OTHER CONGRESSIONAL AUTHORITY
TO MAKE THE APPROPRIATION AVAILABLE TO LIQUIDATE THE OBLIGATION.
SINCE WE HAVE CONCLUDED THAT THE $432 MILLION WAS VALIDLY OBLIGATED
AT THE TIME THE CONTRACT OPTION WAS EXERCISED, THERE IS NO LEGAL BARRIER
TO THE USE OF THE MONEY SO OBLIGATED TO MAKE ALL THE REQUIRED PAYMENTS
ON THE CONTRACT.
B-210593, JUL 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. THE DETERMINATION OF THE RELATIVE MERITS OF PROPOSALS IS THE
RESPONSIBILITY OF THE AGENCY THAT SOLICITED THEM, AND GAO WILL NOT
DISTURB A DETERMINATION UNLESS IT IS SHOWN TO BE ARBITRARY OR TO VIOLATE
PROCUREMENT STATUTES OR REGULATIONS.
2. PROPOSAL EVALUATIONS MUST BE MADE ON THE BASIS OF THE INFORMATION
SUBMITTED WITH THE PROPOSALS. NO MATTER HOW CAPABLE AN OFFEROR MAY BE,
IF IT DOES NOT SUBMIT AN ADEQUATELY WRITTEN PROPOSAL IT CANNOT EXPECT TO
BE CONSIDERED FOR AWARD.
3. A TECHNICALLY UNACCEPTABLE OFFER IS OF NO VALUE TO THE GOVERNMENT
NOTWITHSTANDING ITS PRICE.
4. GAO WILL NOT REVIEW A PROTEST CONCERNING ANOTHER OFFEROR'S SMALL
BUSINESS SIZE STATUS, SINCE BY LAW THE MATTER IS FOR DECISION BY THE
SMALL BUSINESS ADMINISTRATION.
AQUA-TECH, INC.:
AQUA-TECH, INC. PROTESTS THE AWARD OF CONTRACTS TO GEOSCIENCE, INC.
AND VESTER J. THOMPSON, JR., INC., UNDER REQUEST FOR PROPOSALS (RFP) NO.
DACW01-83-R-0011, A SMALL BUSINESS SET-ASIDE ISSUED BY THE ARMY CORPS OF
ENGINEERS, MOBILE, ALABAMA. WE DENY THE PROTEST IN PART AND DISMISS IT
IN PART.
THE SOLICITATION CALLED FOR PROPOSALS FOR TWO JOBS INVOLVING THE
COLLECTION AND ANALYSIS OF SEDIMENT AND WATER SAMPLES FROM THE
PASCAGOULA HARBOR AND MISSISSIPPI SOUND, MISSISSIPPI. JOB 1 INCLUDED
THE COLLECTION OF SAMPLES AND ANALYSIS OF SELECTED PARAMETERS FROM SEVEN
SITES, WHILE JOB 2 INCLUDED ONLY THE ANALYSIS OF SELECTED PARAMETERS
FROM ONE SITE TO SERVE AS A QUALITY CONTROL CHECK FOR JOB 1. THE RFP
STATED THAT THE SAME OFFEROR WOULD NOT BE AWARDED BOTH JOBS, AND THAT
FIRM-FIXED PRICE CONTRACTS WOULD BE AWARDED.
THE SOLICITATION INDICATED THAT TECHNICAL QUALITY, ORGANIZATION AND
PERSONNEL, AND PROPOSED COST WOULD BE EVALUATED ON AN EQUAL BASIS.
AQUA-TECH'S TOTAL EVALUATED SCORE (THE AVERAGE OF THE SCORES UNDER EACH
OF THE 3 EVALUATION FACTORS) FOR JOB 1 - 42.2 POINTS OUT OF 100 - WAS
THE SECOND LOWEST OF THE 13 OFFERORS; GEOSCIENCE'S SCORE OF 86.7 POINTS
WAS THE HIGHEST. AQUA-TECH'S PROPOSED PRICE WAS $40,865, WHILE
GEOSCIENCE'S WAS $54,896. AQUA-TECH'S TOTAL SCORE FOR JOB 2 - 39.7
POINTS - ALSO WAS THE SECOND LOWEST. THE FIRM'S PROPOSED PRICE WAS
$8,637, WHEREAS VESTER J. THOMPSON, JR., WHICH SCORED THE HIGHEST AT
76.6 POINTS, PROPOSED A PRICE OF $9,560.
AQUA-TECH CONTENDS THAT IT IS MUCH MORE CAPABLE THAN ITS EVALUATION
SCORE REFLECTS, AND HAS SUBMITTED DATA, WHICH WAS NOT INCLUDED IN ITS
ORIGINAL PROPOSAL, IN SUPPORT OF THIS CONTENTION.
THE DETERMINATION OF THE RELATIVE MERITS OF AN OFFEROR'S TECHNICAL
PROPOSAL IS PRIMARILY A MATTER OF ADMINISTRATIVE DISCRETION ON THE PART
OF THE CONTRACTING AGENCY. DYNAMIC SCIENCE, INC., B-188472, JULY 20,
1977, 77-2 CPD 39. THE FUNCTION OF OUR OFFICE IS NOT TO EVALUATE ANEW
THE PROPOSALS SUBMITTED AND MAKE OUR OWN DETERMINATION AS TO THEIR
RELATIVE MERITS, HOUSTON FILMS, INC. (RECONSIDERATION), B-184402, JUNE
16, 1976, 76-1 CPD 380, BUT SIMPLY TO DETERMINE IF THERE IS A REASONABLE
BASIS FOR THE EVALUATION. SEE DIGITAL EQUIPMENT CORPORATION, B-207312,
AUGUST 9, 1982, 82-2 CPD 118.
THE ARMY'S EVALUATION TEAM DETERMINED THAT AQUA-TECH'S OFFER WAS
UNACCEPTABLE. THE EVALUATORS FOUND THAT THE FIRM FAILED TO PROVIDE A
DETAILED DISCUSSION OF FIELD SAMPLING METHODOLOGY OR LABORATORY
PROCEDURES NECESSARY FOR THIS PARTICULAR PROCUREMENT. THE TECHNICAL
EVALUATORS ALSO FOUND THAT AQUA-TECH PROPOSED TO USE PROCEDURES NOT
COMPARABLE TO THOSE REQUIRED IN THE SCOPE OF WORK SECTION OF THE
SOLICITATION. AQUA-TECH'S QUALITY CONTROL PLAN WAS DEEMED NOT "PROJECT
SPECIFIC," AND MUCH OF THE PROPOSAL'S DISCUSSION WAS JUDGED NOT RELEVANT
TO THE TASKS REQUIRED FOR COMPLETION OF THE PROJECT. AS TO THE
PERSONNEL QUALIFICATIONS, THE EVALUATORS DETERMINED THAT AQUA-TECH'S
PRESENTATION MADE IT DIFFICULT TO RATE THE EDUCATION AND GRADUATE
TRAINING, AS WELL AS THE WORK EXPERIENCE, OF AQUA-TECH'S PERSONNEL. THE
EVALUATORS CONCLUDED THAT DUE TO THE PROPOSAL'S LACK OF DETAIL,
IRRELEVANT DISCUSSION, AND ERRORS IN SCHEDULING WORK COMPLETION, THERE
WAS SOME QUESTION WHETHER AQUA-TECH UNDERSTOOD THE NEEDS OF THE PROJECT
AS DISCUSSED IN THE SCOPE OF WORK. GEOSCIENCE'S AVERAGE JOB 1 POINT
SCORED, NOT INCLUDING COST, WAS MORE THAN TWICE THAT OF AQUA-TECH, AND
VESTER J. THOMPSON'S AVERAGE FOR JOB 2 WAS ALMOST TWICE AQUA-TECH'S.
AQUA-TECH, PRESENTED WITH THE ARMY EVALUATORS' CONCLUSIONS, DOES NOT
DISPUTE THEM, BUT INSTEAD CONTENDS THAT INFORMATION AND EXPLANATIONS IT
HAS FURNISHED WITH ITS PROTEST SHOW THAT THE FIRM SHOULD HAVE RECEIVED
HIGHER RATINGS.
WE WILL NOT QUESTION THE ARMY'S DETERMINATIONS BASED ON THE
INFORMATION AQUA-TECH NOW PROVIDES. PROPOSALS MUST BE EVALUATED BASED
ON THE INFORMATION FURNISHED WITH THEM. COMTEN-COMRESS, B-183379, JUNE
30, 1975, 75-1 CPD 400. NO MATTER HOW CAPABLE AN OFFEROR MAY BE, IT
CANNOT EXPECT TO BE CONSIDERED FOR AWARD IF IT DOES NOT SUBMIT AN
ADEQUATELY WRITTEN PROPOSAL. INFORMATICS, INC., B-194926, JULY 2, 1980,
80-2 CPD 8. AS AQUA-TECH HAS PROVIDED NO EVIDENCE TO DISPUTE THE
EVALUATION OF THE PROPOSAL IT SUBMITTED, OTHER THAN SUPPLEMENTING ITS
OFFER VIA ITS PROTEST, WE CANNOT OBJECT TO THE EVALUATION OF THE FIRM'S
OFFER. WELDUN SPECIAL MACHINE, B-207268, AUGUST 23, 1982, 82-1 CPD 166.
AQUA-TECH NONETHELESS CONTENDS THAT AWARD TO AN OFFEROR OTHER THAN
THE LOWEST-PRICED ONE IS IMPROPER. AS STATED ABOVE, HOWEVER,
AQUA-TECH'S OFFER WAS FOUND TECHNICALLY UNACCEPTABLE, AND WE HAVE NO
BASIS TO DISAGREE WITH THAT FINDING. OBVIOUSLY, AN UNACCEPTABLE OFFER
IS OF NO VALUE TO THE GOVERNMENT NOTWITHSTANDING ITS PRICE. DUROYD
MANUFACTURING COMPANY, INC., B-195762, NOVEMBER 16, 1979, 79-2 CPD 359.
FINALLY, AQUA-TECH ALLEGES THAT GEOSCIENCE IS NOT A SMALL BUSINESS
FOR PURPOSES OF THIS PROCUREMENT. UNDER 15 U.S.C. SEC. 637(B) (1976),
THE SMALL BUSINESS ADMINISTRATION IS EMPOWERED TO MAKE CONCLUSIVE
DETERMINATIONS ON MATTERS OF SMALL BUSINESS SIZE STATUS FOR FEDERAL
PROCUREMENT PURPOSES. OUR OFFICE THEREFORE DOES NOT CONSIDER SIZE
STATUS PROTESTS. SEE WALSKY CONSTRUCTION CO., B-202719, APRIL 9, 1981,
81-1 CPD 276.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
B-210592, AUG 25, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST OF AGENCY CANCELLATION OF A
CONTRACT ON BASIS THAT THE AWARD WAS
IMPROPER, WILL NOT BE CONSIDERED WHERE
PROTESTER IS NOT SEEKING GAO RECOMMENDATION
THAT CONTRACT BE REINSTATED BUT
IS REQUESTING RECOMMENDATION THAT CANCELLATION
BE CONVERTED TO A TERMINATION
FOR CONVENIENCE, SINCE THAT IS MATTER FOR
RESOLUTION UNDER THE CONTRACT DISPUTES ACT.
WESTINGHOUSE ELECTRIC CORPORATION:
WESTINGHOUSE ELECTRIC CORPORATION PROTESTS THE CANCELLATION OF A
CONTRACT AWARDED IT BY THE UNITED STATES INFORMATION AGENCY (USIA) UNDER
INVITATION FOR BIDS NO. 88-23-2-EA.
THE SOLICITATION SOUGHT BIDS ON A NUMBER OF POWER AND SPECIAL PURPOSE
TUBES TO BE USED BY USIA IN ITS VOICE OF AMERICA RADIO BROADCASTING
FACILITIES. WESTINGHOUSE WAS THE LOW BIDDER ON TUBE TYPES 5682 AND 7482.
PARAGRAPH 21 OF THE SOLICITATION PROVIDED IN PERTINENT PART THAT:
" *** THE ONLY KNOWN TUBES THAT HAVE PROVEN
TO BE SATISFACTORY FOR USE IN AGENCY EQUIPMENT *** FOR
TUBE TYPES 5682 AND TUBE TYPE
7482 ARE MACHLETT ***. IF THE BIDDER
PROPOSES TO FURNISH TUBES OTHER THAN THOSE
DESCRIBED ABOVE, HE MUST BE ABLE TO DEMONSTRATE
A SATISFACTORY HISTORY OF RECENT
OPERATION FOR THE TUBES OFFERED, IN TRANSMITTERS
COMPARABLE TO VOA IN THE SAME POWER
AND FREQUENCY RANGE, IN EXCESS OF THE WARRANTY
HOURS STIPULATED IN THIS SOLICITATION."
THE AGENCY AWARDED A CONTRACT TO WESTINGHOUSE TO PROVIDE, AMONG OTHERS,
ITS OWN TUBE TYPES 5682 AND 7482, BUT IT DID NOT REQUEST OR RECEIVE
PRIOR TO AWARD INFORMATION REGARDING THE PERFORMANCE HISTORY OF THE
ITEMS.
SUBSEQUENT TO THE AWARD TO WESTINGHOUSE, MACHLETT LABORATORIES, INC.
PROTESTED TO THE AGENCY CONTENDING THAT THE AWARD WAS IMPROPER BECAUSE
WESTINGHOUSE HAD NOT PROVIDED THE REQUIRED INFORMATION. THE AGENCY
DETERMINED THAT THE REQUIREMENT FOR EXPERIENCE INFORMATION WAS A MATTER
OF BID RESPONSIVENESS AND CONCLUDED THAT SINCE WESTINGHOUSE HAD NOT
SUBMITTED THE INFORMATION AT BID OPENING, ITS BID SHOULD HAVE BEEN
REJECTED AS NONRESPONSIVE. CONSEQUENTLY, THE AGENCY CANCELED THE
CONTRACT WITH WESTINGHOUSE FOR THESE TWO TUBE TYPES. WESTINGHOUSE
PROTESTED THE CANCELLATION TO THIS OFFICE. THE COMPANY ALSO FILED, AND
SUBSEQUENTLY WITHDREW, AN APPEAL WITH THE ARMED SERVICES BOARD OF
CONTRACT APPEALS (ASBCA).
WESTINGHOUSE CONTENDS THAT USIA'S NONRESPONSIVENESS DETERMINATION WAS
IMPROPER BECAUSE THE SOLICITATION DID NOT REQUIRE SUBMISSION OF THE
EXPERIENCE INFORMATION AT BID OPENING. WHILE WESTINGHOUSE INITIALLY
SOUGHT OUR RECOMMENDATION THAT THE CONTRACT BE REINSTATED, IT NOW STATES
THAT IT "NO LONGER DESIRES REINSTATEMENT OF THE CANCELED PORTION OF THE
CONTRACT" RATHER, IT ARGUES THAT "THE GAO SHOULD RECOMMEND THAT THE USIA
PROPERLY TERMINATE THE CANCELED PORTION OF THE CONTRACT FOR THE
CONVENIENCE OF THE GOVERNMENT." WESTINGHOUSE REQUESTS THAT WE "CONFIRM
THAT THE USIA'S PURPORTED CANCELLATION OF THE CONTRACT EFFECTED A DE
FACTO TERMINATION FOR THE CONVENIENCE OF THE GOVERNMENT."
WE WILL NOT CONSIDER WESTINGHOUSE'S PROTEST. UNDER THE CIRCUMSTANCES
HERE, THE QUESTION OF WHETHER THE AGENCY'S METHOD OF ENDING
WESTINGHOUSE'S CONTRACT SHOULD BE CHARACTERIZED AS A CANCELLATION OR A
TERMINATION FOR CONVENIENCE INVOLVES A MATTER RELATING TO THE CONTRACT
AND, THEREFORE, MUST BE RESOLVED UNDER THE PROVISIONS OF THE CONTRACT
DISPUTES ACT OF 1978, 41 U.S.C. SEC. 601-613 (SUPP. IV 1980). WE
RECOGNIZE THAT IT IS APPROPRIATE IN SOME CIRCUMSTANCES FOR US TO REVIEW
THE PROCEDURES LEADING TO THE AWARD OF A SUBSEQUENTLY TERMINATED
CONTRACT. SEE, E.G., EVERGREEN HELICOPTERS, INC., B-202962, SEPTEMBER
28, 1981, 81-2 CPD 252; NEW ENGLAND TELEPHONE AND TELEGRAPH COMPANY, 59
COMP.GEN. 746 (1980)8 80-2 CPD 225. IN THOSE CASES, HOWEVER, REVIEW OF
THE VALIDITY OF THE AGENCY'S PROCUREMENT PROCEDURES WAS REQUESTED WITH A
VIEW TOWARDS A POSSIBLE GAO RECOMMENDATION THAT THE TERMINATED CONTRACT
BE REINSTATED. HERE, WESTINGHOUSE NO LONGER SEEKS REINSTATEMENT, BUT
SEEKS CONVERSION OF THE CANCELLATION INTO A TERMINATION FOR CONVENIENCE
TO ENABLE WESTINGHOUSE TO RECOVER COSTS IT CLAIMS TO HAVE INCURRED IN
ANTICIPATION OF PERFORMING THE CONTRACT AND TO ARRANGE FOR THE
DISPOSITION OF WHAT IT CALLS ITS "TERMINATION INVENTORY." THESE MATTERS
ARE IN THE NATURE OF A CLAIM UNDER THE CONTRACT FOR MONETARY AND OTHER
RELIEF. WE HAVE TAKEN THE POSITION THAT SUCH MATTERS ARE FOR PROCESSING
UNDER THE CONTRACT DISPUTES ACT RATHER THAN FOR RESOLUTION BY THIS
OFFICE. SEE WALL IRRIGATION SERVICE, 61 COMP.GEN. 114 (1981), 82-1 CPD
100.
ACCORDINGLY, WE DISMISS THE PROTEST.
B-210591, MAR 8, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. A CONTRACTING OFFICER DID NOT ACT IMPROPERLY IN SUPPLYING THE
INTERSTATE COMMERCE COMMISSION (ICC) WITH FACTUAL INFORMATION TO THE
EFFECT THAT THE PROSPECTIVE AWARDEE WAS THE LOW BIDDER AND NEEDED ICC
OPERATING AUTHORITY TO PERFORM THE CONTRACT.
2. A 13-DAY INTERVAL BETWEEN BID OPENING AND CONTRACT AWARD WAS NOT
AN UNREASONABLE AMOUNT OF TIME FOR THE CONTRACTING OFFICER TO ALLOW THE
LOW BIDDER TO OBTAIN ICC OPERATING AUTHORITY.
3. A CONTRACTING OFFICER'S DETERMINATION THAT A BIDDER HAVING ONLY A
TEMPORARY OPERATING PERMIT WAS RESPONSIBLE WAS NOT IMPROPER WHERE THE
SOLICITATION DID NOT SPECIFY THAT FOR PURPOSES OF AWARD OFFERORS HAD TO
HAVE A PERMANENT PERMIT.
DUNHAM TRANSFER AND STORAGE:
DUNHAM TRANSFER AND STORAGE PROTESTS THE AWARD OF A CONTRACT TO
MERCURY TRANSFER AND WAREHOUSE FOR MOVING AND STORAGE SERVICES UNDER
SOLICITATION NO. N60530-83-B-0050 ISSUED BY THE DEPARTMENT OF THE NAVY.
DUNHAM ALLEGES THAT THE CONTRACTING OFFICER IMPROPERLY ASSISTED MERCURY
AFTER BID OPENING TO OBTAIN AN OPERATING PERMIT FROM THE INTERSTATE
COMMERCE COMMISSION (ICC). DUNHAM ALSO CONTENDS THAT AWARD TO MERCURY
WAS IMPROPER SINCE MERCURY HAD ONLY A TEMPORARY OPERATING PERMIT FROM
THE ICC AT THE TIME OF AWARD.
WE DENY THE PROTEST.
SECTION L-28 OF THE SOLICITATION STATED THAT "OFFERORS WITHOUT
NECESSARY OPERATING AUTHORITY MAY SUBMIT OFFERS, BUT THE OFFERORS SHALL
*** BE RESPONSIBLE FOR OBTAINING ANY NECESSARY LICENSES AND PERMITS
PRIOR TO AWARD ***." THAT SECTION ALSO SPECIFIED THAT "ICC MC 165384"
WAS ONE OF THE PERMITS REQUIRED UNDER THE CONTRACT. AT BID OPENING ON
DECEMBER 17, 1982, MERCURY WAS THE APPARENT LOW BIDDER. THEREAFTER,
MERCURY APPLIED TO THE ICC FOR A TEMPORARY OPERATING PERMIT, FOR WHICH
THE CONTRACTING OFFICER, IN SUPPORT OF THE APPLICATION, FILED AN ICC
FORM STATING THAT MERCURY WAS THE LOW BIDDER AND THAT THE PERMIT WAS
NECESSARY FOR THE PERFORMANCE OF A GOVERNMENT CONTRACT. THE ICC GRANTED
THE PERMIT ON DECEMBER 29 AND MERCURY WAS AWARDED THE CONTRACT THE
FOLLOWING DAY.
DUNHAM FIRST CONTENDS THAT IT WAS IMPROPER FOR THE CONTRACTING
OFFICER TO SUPPORT MERCURY'S APPLICATION FOR A PERMIT. WE DISAGREE.
MILITARY REGULATIONS GENERALLY AUTHORIZE DEPARTMENT OF DEFENSE (DOD)
PARTICIPATION IN ICC PROCEEDINGS CONCERNING A CARRIER'S OPERATING
AUTHORITY WHERE, AMONG OTHER THINGS, THAT PARTICIPATION WILL RESULT IN
APPRECIABLY GREATER ECONOMY, FREQUENCY OR SPEED OF CARRIER SERVICE TO
THE DOD, OR THE PROPOSED INAUGURATION OR EXPANSION OF CARRIER SERVICE
WILL BENEFIT THE DOD. MILITARY TRAFFIC MANAGEMENT REGULATION SEC.
105002(3)(C) AND (E) (1969 ED.). IN LIGHT OF THESE REGULATIONS, WE DO
NOT BELIEVE THAT THE CONTRACTING OFFICER ACTED IMPROPERLY IN MERELY
SUPPLYING THE ICC WITH FACTUAL INFORMATION THAT WAS PART OF A PUBLIC
RECORD, WHERE MERCURY'S LOW BID WAS APPARENTLY OTHERWISE IN ORDER. WE
CONSEQUENTLY FIND NO MERIT TO THIS CONTENTION.
WE ALSO REJECT DUNHAM'S ARGUMENT THAT THE CONTRACTING OFFICER
IMPROPERLY DELAYED CONTRACT AWARD WHILE MERCURY SOUGHT AN ICC OPERATING
PERMIT. THE QUESTION OF WHETHER MERCURY COMPLIED WITH THE
SOLICITATION'S PERMIT REQUIREMENT WAS A MATTER OF RESPONSIBILITY SINCE
IT CONCERNED MERCURY'S CAPABILITY TO PERFORM THE CONTRACT. VICTORY VAN
CORPORATION; COLUMBIA VAN LINE, INCORPORATED, 53 COMP.GEN. 750 (1974),
74-1 CPD 178; AMERICAN MUTUAL PROTECTIVE BUREAU, B-208067, JULY 16,
1982, 82-2 CPD 52. IN THIS REGARD, THE CONTRACTING OFFICER PROPERLY
ALLOWED MERCURY A REASONABLE PERIOD OF TIME AFTER BID OPENING TO OBTAIN
THE PERMIT SINCE CONTRACT AWARD AND NOT BID OPENING IS THE CRITICAL TIME
FOR DETERMINING THE RESPONSIBILITY OF A FIRM. AMERIKO MAINTENANCE CO.,
B-208485, AUGUST 27, 1982, 82-2 CPD 184. WE HAVE RECOGNIZED THAT A FIRM
IS ENTITLED TO A REASONABLE TIME TO OBTAIN ANY NECESSARY AUTHORIZATION
THAT IS ESSENTIAL TO CONTRACT PERFORMANCE. SEE CAREER CONSULTANTS,
INC., B-200506.2, MAY 27, 1981, 81-1 CPD 414 (HOLDING THAT A 1-1/2 MONTH
INTERVAL BETWEEN BID OPENING AND CONTRACT AWARD TO PERMIT A BIDDER TO
OBTAIN A SECURITY CLEARANCE IS NOT UNREASONABLE). THERE IS NO REASON TO
BELIEVE THAT A 13-DAY INTERVAL HERE WAS UNREASONABLE.
FINALLY, DUNHAM COMPLAINS THAT AWARD TO MERCURY WAS IMPROPER SINCE
THE FIRM HAD ONLY A TEMPORARY OPERATING PERMIT SCHEDULED TO EXPIRE
BEFORE THE EXPIRATION OF THE CONTRACT. THIS ALLEGATION CONCERNS
MERCURY'S COMPLIANCE WITH A DEFINITIVE RESPONSIBILITY CRITERION SET
FORTH IN THE SOLICITATION, THAT IS, THE PERMIT REQUIREMENT. A
DETERMINATION OF BIDDER RESPONSIBILITY REQUIRES THE EXERCISE OF THE
CONTRACTING OFFICER'S SUBJECTIVE BUSINESS JUDGMENT AND ESSENTIALLY IS A
MATTER WITHIN HIS DISCRETION. 50 STATE SECURITY SERVICE, INC.,
B-208342, AUGUST 17, 1982, 82-2 CPD 140. SINCE THE SOLICITATION HERE
DID NOT SPECIFY THAT OFFERORS HAD TO HAVE PERMANENT ICC PERMITS FOR
PURPOSES OF AWARD, WE ARE UNABLE TO CONCLUDE THAT THE CONTRACTING
OFFICER ABUSED HIS DISCRETION IN DETERMINING THAT MERCURY'S TEMPORARY
PERMIT FULFILLED THE SOLICITATION'S RESPONSIBILITY REQUIREMENTS.
THE PROTEST IS DENIED.
B-210585, FEB 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST THAT CONTRACTING AGENCY DENIED THE PROTESTER AN AN
OPPORTUNITY TO COMPETE BY FAILING TO SEND IT A COPY OF THE SOLICITATION
AND BY LISTING THE PROCUREMENT UNDER AN INCORRECT HEADING IN THE
COMMERCE BUSINESS DAILY, FILED MORE THAN 3 MONTHS AFTER THE PROTESTER
LEARNED THE BASIS OF ITS PROTEST, IS UNTIMELY AND WILL NOT BE CONSIDERED
ON ITS MERITS.
MCKINNEY BEDDING COMPANY:
MCKINNEY BEDDING COMPANY PROTESTS THE AWARD OF A CONTRACT UNDER
INVITATION FOR BIDS NO. FNPS-S5-1235-N-6-11-82 ISSUED BY THE GENERAL
SERVICES ADMINISTRATION (GSA). THE SOLICITATION IS FOR A FEDERAL SUPPLY
SCHEDULE REQUIREMENTS CONTRACT FOR HOSPITAL PATIENT ROOM FURNITURE.
MCKINNEY COMPLAINS THAT GSA IMPERMISSIBLY DENIED IT AN OPPORTUNITY TO
COMPETE FOR THE CONTRACT. MCKINNEY ALLEGES THAT GSA DID NOT PROVIDE IT
A COPY OF THE SOLICITATION EVEN THOUGH IT SUBMITTED A BID UNDER THE
PREVIOUS SOLICITATION. ADDITIONALLY, MCKINNEY ALLEGES THAT IT DID NOT
OTHERWISE HAVE NOTICE THAT A SOLICITATION HAD BEEN ISSUED BECAUSE THE
SYNOPSIS OF THE PROCUREMENT IN THE COMMERCE BUSINESS DAILY OF JUNE 1,
1982, WAS INCORRECTLY LISTED UNDER THE HEADING "65 MEDICAL, DENTAL AND
VETERINARY EQUIPMENT SUPPLIES," RATHER THAN UNDER "71 FURNITURE."
MCKINNEY DID NOT LEARN OF THE SOLICITATION UNTIL SEPTEMBER 1982. BIDS
WERE OPENED ON JUNE 11, 1982.
OUR BID PROTEST PROCEDURES REQUIRE PROTESTS TO BE FILED WITHIN 10
WORKING DAYS AFTER THE BASIS OF PROTEST BECOMES KNOWN. 4 C.F.R. SEC.
21.2(B)(2) (1982). SINCE MCKINNEY LEARNED ITS BASIS OF PROTEST IN
SEPTEMBER 1982 BUT DID NOT FILE A PROTEST WITH OUR OFFICE UNTIL JANUARY
24, 1983, THE PROTEST IS UNTIMELY AND WILL NOT BE CONSIDERED ON ITS
MERITS.
THE PROTEST IS DISMISSED.
B-210585.2, APR 5, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PRIOR DECISION THAT A PROTEST ALLEGING THAT THE CONTRACTING
AGENCY DENIED THE PROTESTER AN OPPORTUNITY TO COMPETE WAS UNTIMELY
BECAUSE IT WAS FILED MORE THAN 3 MONTHS AFTER THE PROTESTER LEARNED THE
BASIS OF ITS PROTEST IS AFFIRMED.
2. AN AGENCY MAY CONSIDER A BID RECEIVED AFTER BID OPENING ONLY IF
THE BID WAS SENT BY REGISTERED OR CERTIFIED MAIL 5 CALENDAR DAYS BEFORE
BID OPENING OR THE BID WAS RECEIVED LATE DUE SOLELY TO GOVERNMENT
MISHANDLING. A BID SUBMITTED AFTER BID OPENING MAY NOT BE CONSIDERED IN
ANY CASE.
MCKINNEY BEDDING CO. - RECONSIDERATION:
MCKINNEY BEDDING COMPANY REQUESTS THAT WE RECONSIDER OUR DECISION
MCKINNEY BEDDING COMPANY, B-210585, FEBRUARY 7, 1983, 83-1 CPD . IN
THAT DECISION, WE DISMISSED AS UNTIMELY MCKINNEY'S PROTEST THAT THE
GENERAL SERVICES ADMINISTRATION (GSA) PREVENTED MCKINNEY FROM COMPETING
FOR A CONTRACT UNDER INVITATION FOR BIDS NO. FNPS-S5-1235-N-6-11-82.
MCKINNEY POINTED OUT THAT GSA DID NOT PROVIDE IT A COPY OF THE
SOLICITATION EVEN THOUGH IT SUBMITTED A BID UNDER A PREVIOUS
SOLICITATION AND ALLEGED THAT GSA INCORRECTLY SYNOPSIZED THE REQUIREMENT
IN THE COMMERCE BUSINESS DAILY. WE FOUND THE PROTEST TO BE UNTIMELY
BECAUSE MCKINNEY LEARNED OF THE BASES OF PROTEST IN SEPTEMBER 1982, BUT
DID NOT FILE A PROTEST UNTIL JANUARY 24, 1983. OUR BID PROTEST
PROCEDURES REQUIRE PROTESTS TO BE FILED WITHIN 10 WORKING DAYS OF THE
TIME THE PROTESTER LEARNS OF ITS BASIS FOR PROTEST. 4 C.F.R. SEC.
21.2(B)(2) (1982).
MCKINNEY NOW CONTENDS THAT IN ADDITION TO THE BASES OF PROTEST NOTED
ABOVE, ITS INITIAL PROTEST CONTAINED A THIRD BASIS, THE REJECTION OF A
BID IT SUBMITTED NEARLY 4 MONTHS AFTER THE JUNE 11, 1982, BID OPENING.
MCKINNEY CLAIMS THAT A GSA OFFICIAL INDICATED THAT THE LATE BID MIGHT BE
CONSIDERED IN VIEW OF MCKINNEY'S LACK OF OPPORTUNITY TO SUBMIT A BID
PRIOR TO BID OPENING. MCKINNEY CLAIMS THAT IT DID NOT LEARN OF THE
REJECTION UNTIL JANUARY 10 AND, THEREFORE, THE PROTEST FILED ON JANUARY
24, 1983 WAS TIMELY AS TO THE BID REJECTION BASIS.
WE BELIEVE THAT OUR INITIAL DETERMINATION THAT THE PROTEST WAS
UNTIMELY WAS CORRECT. MCKINNEY'S CONTENTION THAT ITS LATE BID SHOULD BE
ACCEPTED BY GSA IS SO INTERTWINED WITH ITS CLAIM THAT IT WAS UNFAIRLY
DENIED AN OPPORTUNITY TO COMPETE FOR THE CONTRACT THAT, IN OUR VIEW, IT
DOES NOT CONSTITUTE A SEPARATE AND INDEPENDENT BASIS OF PROTEST.
RATHER, WE REGARD THE ACCEPTANCE OF THE LATE BID AS THE RELIEF REQUESTED
FOR THE ALLEGED DENIAL OF AN OPPORTUNITY TO COMPETE. UNDER THE
CIRCUMSTANCES, WE BELIEVE WE PROPERLY DECLINED TO CONSIDER THE MERITS OF
THE PROTEST SINCE IT WAS FILED 4 MONTHS AFTER THE BASIS OF PROTEST
(DENIAL OF AN OPPORTUNITY TO COMPETE) WAS LEARNED.
WE POINT OUT THAT EVEN IF WE FOUND THE CONTENTION THAT GSA IMPROPERLY
REJECTED THE LATE BID TO AN INDEPENDENT AND TIMELY-FILED BASIS OF
PROTEST, THE CONTENTION CLEARLY LACKS MERIT. BIDS WERE OPENED ON JUNE
11 AND MCKINNEY SUBMITTED A BID IN OCTOBER. THE FEDERAL PROCUREMENT
REGULATIONS (FPR) PERMIT THE CONSIDERATION OF LATE BIDS ONLY IF THE BID
IS SENT BY REGISTERED OR CERTIFIED MAIL 5 CALENDAR DAYS BEFORE OPENING
OR IF A MAILED OR TELEGRAPHED BID IS RECEIVED LATE DUE SOLELY TO THE
GOVERNMENT'S MISHANDLING AFTER RECEIPT AT THE INSTALLATION. FPR SEC.
1-2.303 (1964 ED.). THE REGULATIONS DO NOT CONTEMPLATE THE
CONSIDERATION OF A BID SUBMITTED AFTER THE FIELD OF COMPETITION HAS BEEN
DEFINED AS OF BID OPENING. SEE HARRIS CORPORATION, PRD ELECTRONICS
DIVISION, B-209154, OCTOBER 13, 1982, 82-2 CPD 332. SINCE MCKINNEY'S
LATE BID DOES NOT FALL WITHIN EITHER EXCEPTION TO THE RULE AGAINST
CONSIDERING LATE BIDS, GSA HAD NO AUTHORITY TO ACCEPT THE BID AND ITS
REJECTION OF THE BID WAS PROPER.
WE AFFIRM OUR INITIAL DECISION.
B-210582, MAY 3, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE PROTESTER INCLUDES IN ITS BID COMPLETED CLAUSES REGARDING
ORDERING AND GUARANTEED MINIMUM QUANTITIES NOT APPLICABLE TO
PROCUREMENT, AGENCY MAY PROPERLY FIND BID NONRESPONSIVE IF BIDDER'S
INTENTION TO COMPLY WITH TERMS OF SOLICITATION IS NOT DISCERNIBLE FROM
THE FACE OF THE BID.
2. BID PROTEST FILED AFTER BID OPENING ALLEGING THAT SOLICITATION
PROVISIONS ARE AMBIGUOUS IS TIMELY SINCE PROTESTER WAS UNAWARE OF AGENCY
INTERPRETATION FORMING BASIS OF PROTEST UNTIL AFTER BIDS WERE OPENED.
3. WHERE PROTESTER'S INTERPRETATION OF AN IFB INSTRUCTION IS
INCONSISTENT WITH FORMAT USED IN SOLICITATION, THE INTERPRETATION IS NOT
REASONABLE AND PROVIDES NO BASIS FOR CONCLUDING THAT IFB WAS AMBIGUOUS.
4. POSSIBILITY THAT THE GOVERNMENT MIGHT REALIZE MONETARY SAVINGS IN
A PARTICULAR PROCUREMENT IF MATERIAL BID DEFICIENCY IS WAIVED IS
OUTWEIGHED BY IMPORTANCE OF MAINTAINING INTEGRITY OF THE COMPETITIVE
BIDDING SYSTEM.
LEEMING/PACQUIN, DIVISION OF PFIZER, INC.:
LEEMING/PACQUIN, DIVISION OF PFIZER, INC. (PFIZER), PROTESTS THE
REJECTION OF ITS BID AND THE AWARD OF A CONTRACT TO KETCHUM
LABORATORIES, INC., UNDER INVITATION FOR BIDS (IFB) NO.
DLA120-83-B-0300 ISSUED BY THE DEFENSE PERSONNEL SUPPORT CENTER (DPSC),
DEFENSE LOGISTICS AGENCY. DPSC REJECTED PFIZER'S LOW BID BECAUSE IT WAS
CONSIDERED TO BE NONRESPONSIVE. WE DENY THE PROTEST.
THE IFB, ISSUED ON NOVEMBER 26, 1982, WITH BID OPENING ON DECEMBER
28, 1982, WAS FOR AN ESTIMATED QUANTITY OF 195,000 BOTTLES OF
TETRAHYDROZOLINE HYDROCHLORIDE OPHTHALMIC SOLUTION, DPSC'S ESTIMATED
REQUIREMENT FOR THE FOLLOWING YEAR.
THE SOLICITATION WAS PREPARED IN ACCORDANCE WITH THE UNIFORM CONTRACT
FORMAT SET FORTH IN DEFENSE ACQUISITION REGULATION SEC. 2-201 (DEFENSE
ACQUISITION CIRCULAR NO. 76-20, SEPTEMBER 17, 1979). THE SOLICITATION
CONTAINED ON OVERPRINTS (PREPRINTED ATTACHMENTS) LP124 AND LP125,
VARIOUS ALTERNATE PROVISIONS RELATING TO INDEFINITE DELIVERY-TYPE
CONTRACTS. THE ALTERNATE PROVISIONS THAT WERE INTENDED TO APPLY TO THE
ACQUISITION WERE MARKED WITH AN "X" IN THE APPROPRIATE BLOCKS PRECEDING
THE CAPTIONS OF THE PROVISIONS. INSTRUCTIONS CONTAINED IN THE
SOLICITATION CLEARLY STATED THAT THOSE WERE THE ONLY PROVISIONS
APPLICABLE TO THE PROCUREMENT.
ALTHOUGH THE SOLICITATION DID NOT REQUIRE ENTRIES IN ANY OF THE
CLAUSES ON OVERPRINTS LP124 AND LP125, PFIZER MADE ENTRIES IN FOUR
INAPPLICABLE CLAUSES ON THOSE PAGES. DPSC REJECTED PFIZER'S BID AS
NONRESPONSIVE BECAUSE ENTRIES IN TWO OF THOSE CLAUSES MADE UNCERTAIN
PFIZER'S INTENTION TO BE BOUND, WITHOUT EXCEPTION, TO THE TERMS OF THE
CONTRACT.
PFIZER CONTENDS THAT, SINCE THE CLAUSES WERE NOT MEANT TO BE
APPLICABLE TO THE PROCUREMENT, THE ENTRIES MADE THEREIN SHOULD NOT
OPERATE TO REINSTATE THE CLAUSES AS APPLICABLE. PFIZER REQUESTS THAT
THOSE CLAUSES NOT BE CONSIDERED IN EVALUATING THE BIDS AND THAT IT BE
AWARDED THE CONTRACT AS THE LOWEST RESPONSIVE AND RESPONSIBLE BIDDER.
PFIZER ALTERNATIVELY CONTENDS THAT THE INCLUSION OF THE CLAUSES IN THE
SOLICITATION DOCUMENT CREATED AN AMBIGUITY WHICH REQUIRES CANCELLATION
OF THIS SOLICITATION AND THE RESOLICITATION OF THE CONTRACT. FINALLY,
PFIZER ARGUES THAT OUR OFFICE SHOULD SUSTAIN ITS PROTEST ON EITHER OF
THOSE GROUNDS SINCE DOING SO COULD RESULT IN LESS COST TO THE
GOVERNMENT.
WE DISAGREE WITH PFIZER'S CONTENTION THAT IT SHOULD RECEIVE THE
AWARD, NOTWITHSTANDING THE FACT THAT IT SUPPLIED INFORMATION IN ITS BID
THAT CAUSED DPSC TO FIND THE BID NONRESPONSIVE.
SPECIFICALLY, PFIZER COMPLETED INAPPLICABLE CLAUSES WHICH INDICATED
(1) THAT IT WOULD MAKE ALL DELIVERIES WITHIN 1 YEAR OF THE DATE OF
CONTRACT AWARD AND (2) THAT THE GOVERNMENT WOULD GUARANTEE A MINIMUM
PROCUREMENT OF 195,000 UNITS. THE TERMS OF THE SOLICITATION, HOWEVER,
REQUIRED DELIVERY UP TO 90 DAYS AFTER THE 1-YEAR CONTRACT EXPIRED (AS
LONG AS ORDERS WERE PLACED WITHIN THE 1-YEAR PERIOD) AND PROVIDED FOR NO
GUARANTEED MINIMUM QUANTITY, ALTHOUGH IT ESTIMATED THE AGENCY'S NEEDS TO
BE 195,000 UNITS PER YEAR.
OUR OFFICE HAS LONG HELD THAT A BID IS NOT RESPONSIVE UNLESS A BIDDER
UNEQUIVOCALLY OFFERS TO PROVIDE THE REQUESTED ITEM IN TOTAL CONFORMANCE
WITH THE SPECIFICATION REQUIREMENTS. A BIDDER'S INTENTION MUST BE
DETERMINED FROM THE BID ITSELF AT THE TIME OF BID OPENING. SEE FRANKLIN
INSTRUMENT CO. INC., B-204311, FEBRUARY 8, 1982, 82-1 CPD 105. WHERE A
BID IS SUBJECT TO TWO REASONABLE INTERPRETATIONS, ONE OF WHICH RENDERS
IT NONRESPONSIVE, THE BID IS PROPERLY REJECTED. HUB TESTING
LABORATORIES, B-207352, AUGUST 17, 1982, 82-2 CPD 136.
IT IS OUR OPINION THAT PFIZER'S COMPLETION OF THE INAPPLICABLE
CLAUSES MADE ITS BID SUBJECT TO MORE THAN ONE REASONABLE INTERPRETATION.
LOOKING AT THE BID IN THE MANNER MOST FAVORABLE TO PFIZER, IT CAN BE
CONCLUDED THAT THE TWO CLAUSES WERE COMPLETED IN ERROR AND THAT, SINCE
THEY INITIALLY WERE INAPPLICABLE TO THE PROCUREMENT, THEY SHOULD BE
IGNORED IN EVALUATING THE BID'S RESPONSIVENESS. HOWEVER, WE BELIEVE IT
ALSO IS REASONABLE TO CONCLUDE THAT THE LANGUAGE WAS ADDED BECAUSE
PFIZER INTENDED TO CONDITION ITS BID ON THE GUARANTEE OF A MINIMUM
QUANTITY AND ON THE COMPLETION OF ALL DELIVERIES WITHIN 1 YEAR. SINCE
PFIZER'S BID, THEREFORE, WAS SUBJECT TO TWO INTERPRETATIONS, ONE OF
WHICH WOULD MAKE THE BID NONRESPONSIVE, WE CONCUR WITH THE DETERMINATION
THAT THE BID WAS NONRESPONSIVE.
PFIZER ALSO SUGGESTS THAT THE SOLICITATION WAS AMBIGUOUS SINCE THE
INSTRUCTIONS CONCERNING WHICH CLAUSES WERE APPLICABLE FOLLOWED BY
SEVERAL PAGES THOSE INAPPLICABLE CLAUSES COMPLETED BY PFIZER. SINCE NO
ANNOTATION DELETING THOSE CLAUSES WAS INCLUDED ON THE PAGES ON WHICH THE
CLAUSES APPEARED, PFIZER PRESUMED THEY WERE APPLICABLE AND COMPLETED
THEM.
DPSC ARGUES THAT THE COMPLAINT THAT THE SOLICITATION WAS AMBIGUOUS IS
BASED UPON AN ALLEGED IMPROPRIETY IN THE SOLICITATION APPARENT PRIOR TO
BID OPENING AND, THEREFORE, SHOULD HAVE BEEN FILED PRIOR TO BID OPENING
IN ORDER TO BE TIMELY UNDER OUR BID PROTEST PROCEDURES, 4 C.R. F. SEC.
21.2(B)(1) (1983). AS PFIZER POINTS OUT, HOWEVER, NOT UNTIL IT WAS
INFORMED THAT ITS BID HAD BEEN REJECTED DID IT BECOME AWARE THAT IT
INTERPRETED THE DIRECTIONS REGARDING THE APPLICABLE CLAUSES DIFFERENTLY
THAN DPSC INTENDED AND, THUS, WAS AWARE OF THE BASIS OF ITS PROTEST. WE
AGREE WITH THE PROTESTER AND CONSIDER ITS PROTEST TO BE TIMELY BECAUSE
IT WAS FILED WITH OUR OFFICE WITHIN 10 DAYS OF THE DAY PFIZER LEARNED OF
THE REJECTION OF ITS BID.
AN IFB IS AMBIGUOUS ONLY IF TWO OR MORE REASONABLE INTERPRETATIONS OF
IT ARE POSSIBLE. KLEEN-RITE CORPORATION, B-189458, SEPTEMBER 28, 1977,
77-2 CPD 237. PFIZER INTERPRETS THE IFB AS DELETING ONLY THOSE
PARAGRAPHS NOT MARKED BY AN "X" THAT FOLLOWED THE INSTRUCTIONS ON PAGE
10 WHICH STATED: "THE CLAUSES LISTED HEREIN, IF MARKED WITH AN X IN THE
SPACE PROVIDED, APPLY TO THE SOLICITATION." THE CONTRACTING AGENCY
CONTENDS THAT PFIZER'S INTERPRETATION OF THE WARNING WAS NOT A
REASONABLE ONE AND THAT THE STATEMENT CAN REASONABLY BE INTERPRETED ONLY
AS REFERRING TO THE SOLICITATION AS A WHOLE. WE AGREE WITH THE AGENCY.
SINCE THE CLAUSES APPEARING BOTH BEFORE AND AFTER THE INSTRUCTIONS WERE
PRESENTED IN THE SAME FORMAT, THAT IS, PRECEDED BY BLOCKS TO BE MARKED
WHEN THE CLAUSE WAS APPLICABLE, WE BELIEVE THAT PFIZER'S INTERPRETATION
IS NOT A REASONABLE ONE.
ACCORDINGLY, WE CONCLUDE THAT THE PROTESTER'S INTERPRETATION OF THE
IFB WAS NOT REASONABLE, THAT THE IFB WAS NOT AMBIGUOUS, AND DPSC IS
CORRECT IN ITS POSITION OF FINDING THE BID NONRESPONSIVE.
PFIZER ARGUES THAT WE SHOULD FIND ITS BID RESPONSIVE OR CANCEL THE
PROCUREMENT AND READVERTISE IN THE INTEREST OF SAVING THE GOVERNMENT THE
ADDITIONAL COST OF PROCURING THE OPHTHALMIC SOLUTION FROM THE SECOND
LOWEST BIDDER. WE MUST REJECT THIS ARGUMENT. WE HAVE LONG HELD THAT
THE IMPORTANCE OF MAINTAINING THE INTEGRITY OF THE COMPETITIVE BIDDING
SYSTEM OUTWEIGHS THE POSSIBILITY THAT THE GOVERNMENT MIGHT REALIZE
MONETARY SAVINGS IN A PARTICULAR PROCUREMENT IF A MATERIAL DEFICIENCY
LIKE THOSE PRESENTED IN PFIZER'S BID IS WAIVED. 1010 INCORPORATED OF
ALAMOGORDO, B-204742, DECEMBER 21, 1981, 81-2 CPD 486.
THE PROTEST IS DENIED.
B-210580, FEB 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT CONSIDER A PROTEST OF A SELECTED OFFEROR'S SMALL
BUSINESS SIZE STATUS BECAUSE THE SMALL BUSINESS ADMINISTRATION, NOT GAO,
HAS STATUTORY AUTHORITY TO CONCLUSIVELY DETERMINE SMALL BUSINESS SIZE
STATUS FOR FEDERAL PROCUREMENTS.
WILLIAMSON MACHINE CO., INC.:
WILLIAMSON MACHINE CO., INC. PROTESTS THE SMALL BUSINESS STATUS OF
S.F.&G. INC. DBA MERCURY (SF&G), THE SELECTED OFFEROR UNDER REQUEST FOR
PROPOSAL 1-13-5715.1892 ISSUED BY THE NATIONAL AERONAUTICS AND SPACE
ADMINISTRATION. THE PROCUREMENT - FOR SUPPORT SERVICES AT LANGLEY
RESEARCH CENTER, HAMPTON, VIRGINIA - WAS TOTALLY SET ASIDE FOR SMALL
BUSINESS CONCERNS. THE PROTESTER ASSERTS THAT THE OFFER OF SF&G SHOULD
NOT HAVE BEEN CONSIDERED BECAUSE SF&G IS NOT A SMALL BUSINESS.
WE WILL NOT CONSIDER THE PROTEST. THE SMALL BUSINESS ADMINISTRATION
(SBA), NOT THIS OFFICE, HAS STATUTORY AUTHORITY TO CONCLUSIVELY
DETERMINE MATTERS OF SMALL BUSINESS SIZE STATUS FOR FEDERAL
PROCUREMENTS. 15 U.S.C. SEC. 637(B) (SUPP. IV 1980); KELLEY NAME PIN
CO., INC., B-204735, SEPTEMBER 22, 1981, 81-2 CPD 242. ANY SIZE STATUS
CHALLENGE MUST BE MADE ACCORDING TO SBA PROCEDURES, RATHER THAN THROUGH
A BID PROTEST. BOBCAT OF TIDEWATER, INC., B-206949, APRIL 12, 1982,
82-1 CPD 337.
THE PROTEST IS DISMISSED.
B-210579, MAR 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROPOSAL MAILED BY EXPRESS MAIL WAS NOT DELIVERED TO GOVERNMENT
INSTALLATION PRIOR TO OPENING BY POSTAL SERVICE BECAUSE AGENCY COURIER
ROUTINELY PICKED UP THE MAIL FROM THE POST OFFICE PRIOR TO THE
PROPOSAL'S ARRIVAL AT THE POST OFFICE. THEREFORE, EXCEPTION FOR
CONSIDERATION OF LATE PROPOSAL BECAUSE OF GOVERNMENT INSTALLATION IS
INAPPLICABLE.
2. CONTRACTING OFFICER WHO HAS BEEN ADVISED THAT PROPOSAL IS BEING
SENT BY EXPRESS MAIL IS NOT REQUIRED TO DISPATCH COURIER TO PICK UP
PROPOSAL FROM POST OFFICE WHERE PROPOSALS WERE REQUIRED TO BE SUBMITTED
AT GOVERNMENT INSTALLATION RATHER THAN POST OFFICE.
HUBBS-SEA WORLD RESEARCH INSTITUTE:
HUBBS-SEA WORLD RESEARCH INSTITUTE (HUBBS-SEA) PROTESTS THE NATIONAL
OCEANIC AND ATMOSPHERIC ADMINISTRATION'S (NOAA) REJECTION OF ITS LATE
PROPOSAL, SUBMITTED UNDER SOLICITATION NO. WASC-83-00065. THE PROTEST
IS SUMMARILY DENIED.
PROPOSALS WERE REQUIRED TO BE DELIVERED TO THE WESTERN ADMINISTRATION
SUPPORT CENTER, SEATTLE, WASHINGTON, BY FRIDAY, JANUARY 14, 1983, AT 3
P.M. HUBBS-SEA MAILED ITS PROPOSAL BY EXPRESS MAIL IN SAN DIEGO AT 8:45
A.M. ON JANUARY 13. THE POSTAL SERVICE GUARANTEED DELIVERY BY JANUARY
14 AT 3 P.M.
HUBBS-SEA NOTIFIED THE CONTRACTING OFFICER ON JANUARY 13 THAT THE
PROPOSAL WAS MAILED BY EXPRESS MAIL AND REQUESTED ACKNOWLEDGMENT UPON
RECEIPT. AT 11:30 A.M. ON JANUARY 14, NOAA ADVISED HUBBS-SEA THAT THE
PROPOSAL HAD NOT YET BEEN RECEIVED. IT DID NOT ARRIVE UNTIL MONDAY,
JANUARY 17, AND WAS REJECTED AS LATE.
HUBBS-SEA CONTENDS THAT POSTAL SERVICE RECORDS INDICATE THE PROPOSAL
WAS RECEIVED AT THE SEATTLE POST OFFICE ON JANUARY 14 AT 9:30 A.M. THE
POSTAL SERVICE DID NOT DELIVER THE PROPOSAL BECAUSE EXPRESS MAIL IS
PICKED UP AT THE SEATTLE POST OFFICE BY AN NOAA COURIER AT 8:20 A.M.
EACH DAY. THE PROPOSAL STAYED AT THE SEATTLE POST OFFICE PAST THE 3 P.
M. DEADLINE.
OUR OFFICE HAS CONSISTENTLY HELD THAT IT IS THE OFFEROR'S
RESPONSIBILITY TO ASSURE TIMELY RECEIPT OF ITS PROPOSAL AND THAT THE
OFFEROR MUST BEAR THE RESPONSIBILITY UNLESS THE SPECIFIC CONDITIONS OF
THE SOLICITATION FOR CONSIDERATION OF LATE PROPOSALS ARE MET. SIGMA
TREATMENT SYSTEMS, B-207791, JUNE 21, 1982, 82-1 CPD 613. THESE RULES
PERMIT THE CONSIDERATION OF LATE PROPOSALS WHICH WERE SENT AT LEAST 5
DAYS PRIOR TO THE CLOSING DATE FOR RECEIPT OF PROPOSALS BY CERTIFIED OR
REGISTERED MAIL OR WHERE THE SOLE OR PARAMOUNT CAUSE OF DELAY IS
GOVERNMENT MISHANDLING AFTER RECEIPT AT THE GOVERNMENT INSTALLATION.
FEDERAL PROCUREMENT REGULATIONS SEC. 1-2.201(A)(31) (1964 ED.).
HUBBS-SEA CONTENDS THAT ITS PROPOSAL SHOULD BE CONSIDERED BECAUSE IT
WAS SENT BY EXPRESS MAIL AND THE POSTAL SERVICE FAILED TO MAKE DELIVERY
AS GUARANTEED. WE DISAGREE. EXPRESS MAIL DELIVERY DOES NOT FALL WITHIN
THE LATE PROPOSAL EXCEPTIONS. RECEIPT BY THE POSTAL SERVICE IS NOT
RECEIPT AT THE GOVERNMENT INSTALLATION, EXPRESS MAIL IS NOT THE
EQUIVALENT OF REGISTERED OR CERTIFIED MAIL, AND, IN ANY EVENT, HUBBS-SEA
MAILED ITS PROPOSAL 1 DAY, RATHER THAN 5 DAYS, BEFORE PROPOSALS WERE
DUE. SIGMA TREATMENT SYSTEMS, SUPRA; SEE GERONIMO SERVICE COMPANY,
B-199864, OCTOBER 28, 1980, 80-2 CPD 325.
HUBBS-SEA CONTENDS THAT THE CONTRACTING OFFICER SHOULD HAVE
DISPATCHED A COURIER TO PICK UP THE PROPOSAL UPON BEING NOTIFIED THAT IT
WAS BEING SENT BY EXPRESS MAIL. WE INITIALLY NOTE THAT THE CONTRACTING
OFFICER WAS ASKED TO ACKNOWLEDGE RECEIPT RATHER THAN TO PICK UP THE
PROPOSAL. THE CONTRACTING OFFICER THEREFORE HAD NO REASON TO BELIEVE
THE PROPOSAL WOULD NOT BE DELIVERED. MORE SIGNIFICANTLY, THE
CONTRACTING OFFICER HAD NO OBLIGATION TO PROVIDE SUCH EXTRAORDINARY
ASSISTANCE. WE HAVE HELD THAT THE PROCURING AGENCY IS NOT REQUIRED TO
ACKNOWLEDGE RECEIPT. TENAVISION INC., B-207977, JULY 20, 1982, 82-2 CPD
64; X-TYAL INTERNATIONAL CORPORATION, B-202434, JANUARY 7, 1982, 82-1
CPD 19. IT CERTAINLY FOLLOWS THAT THE PROCURING AGENCY NEED NOT TAKE
THE EXTRAORDINARY ACTION OF SEARCHING FOR AN OFFEROR'S PROPOSAL WHICH
HAS NOT YET BEEN RECEIVED AT THE GOVERNMENT INSTALLATION. AS WE NOTED
ABOVE, IT IS THE OFFEROR'S RESPONSIBILITY TO ASSURE THE TIMELY RECEIPT
OF ITS PROPOSAL.
HUBBS-SEA'S FINAL GROUND OF PROTEST IS THAT THE 8:20 A.M. PICKUP TIME
HAD THE EFFECT OF SHORTENING THE 3 P.M. DEADLINE TO 8:20 A.M. WE
DISAGREE. PROPOSALS WERE RECEIVED UNTIL 3 P.M. BY NOAA AND IT WAS ONLY
HUBBS-SEA'S CHOICE OF DELIVERY METHOD WHICH MADE THE PROPOSAL LATE.
OUR OFFICE GENERALLY REQUESTS A REPORT FROM THE PROCURING AGENCY UPON
RECEIPT OF A PROTEST AND WITHHOLDS ISSUING A DECISION PENDING RECEIPT
AND REVIEW OF THE REPORT. SEE 4 C.F.R. SEC. 21.3 (1982). HOWEVER, WHERE
IT IS CLEAR FROM A PROTESTER'S INITIAL SUBMISSION THAT THE PROTEST IS
WITHOUT LEGAL MERIT, THE MATTER WILL BE DECIDED SUMMARILY. TENAVISION
INC., SUPRA.
THE PROTEST IS SUMMARILY DENIED.
B-210579, MAR 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROPOSAL MAILED BY EXPRESS MAIL WAS NOT DELIVERED TO GOVERNMENT
INSTALLATION PRIOR TO OPENING BY POSTAL SERVICE BECAUSE AGENCY COURIER
ROUTINELY PICKED UP THE MAIL FROM THE POST OFFICE PRIOR TO THE
PROPOSAL'S ARRIVAL AT THE POST OFFICE. THEREFORE, EXCEPTION FOR
CONSIDERATION OF LATE PROPOSAL BECAUSE OF GOVERNMENT INSTALLATION IS
INAPPLICABLE.
2. CONTRACTING OFFICER WHO HAS BEEN ADVISED THAT PROPOSAL IS BEING
SENT BY EXPRESS MAIL IS NOT REQUIRED TO DISPATCH COURIER TO PICK UP
PROPOSAL FROM POST OFFICE WHERE PROPOSALS WERE REQUIRED TO BE SUBMITTED
AT GOVERNMENT INSTALLATION RATHER THAN POST OFFICE.
HUBBS-SEA WORLD RESEARCH INSTITUTE:
HUBBS-SEA WORLD RESEARCH INSTITUTE (HUBBS-SEA) PROTESTS THE NATIONAL
OCEANIC AND ATMOSPHERIC ADMINISTRATION'S (NOAA) REJECTION OF ITS LATE
PROPOSAL, SUBMITTED UNDER SOLICITATION NO. WASC-83-00065. THE PROTEST
IS SUMMARILY DENIED.
PROPOSALS WERE REQUIRED TO BE DELIVERED TO THE WESTERN ADMINISTRATION
SUPPORT CENTER, SEATTLE, WASHINGTON, BY FRIDAY, JANUARY 14, 1983, AT 3
P.M. HUBBS-SEA MAILED ITS PROPOSAL BY EXPRESS MAIL IN SAN DIEGO AT 8:45
A.M. ON JANUARY 13. THE POSTAL SERVICE GUARANTEED DELIVERY BY JANUARY
14 AT 3 P.M.
HUBBS-SEA NOTIFIED THE CONTRACTING OFFICER ON JANUARY 13 THAT THE
PROPOSAL WAS MAILED BY EXPRESS MAIL AND REQUESTED ACKNOWLEDGMENT UPON
RECEIPT. AT 11:30 A.M. ON JANUARY 14, NOAA ADVISED HUBBS-SEA THAT THE
PROPOSAL HAD NOT YET BEEN RECEIVED. IT DID NOT ARRIVE UNTIL MONDAY,
JANUARY 17, AND WAS REJECTED AS LATE.
HUBBS-SEA CONTENDS THAT POSTAL SERVICE RECORDS INDICATE THE PROPOSAL
WAS RECEIVED AT THE SEATTLE POST OFFICE ON JANUARY 14 AT 9:30 A.M. THE
POSTAL SERVICE DID NOT DELIVER THE PROPOSAL BECAUSE EXPRESS MAIL IS
PICKED UP AT THE SEATTLE POST OFFICE BY AN NOAA COURIER AT 8:20 A.M.
EACH DAY. THE PROPOSAL STAYED AT THE SEATTLE POST OFFICE PAST THE 3 P.
M. DEADLINE.
OUR OFFICE HAS CONSISTENTLY HELD THAT IT IS THE OFFEROR'S
RESPONSIBILITY TO ASSURE TIMELY RECEIPT OF ITS PROPOSAL AND THAT THE
OFFEROR MUST BEAR THE RESPONSIBILITY UNLESS THE SPECIFIC CONDITIONS OF
THE SOLICITATION FOR CONSIDERATION OF LATE PROPOSALS ARE MET. SIGMA
TREATMENT SYSTEMS, B-207791, JUNE 21, 1982, 82-1 CPD 613. THESE RULES
PERMIT THE CONSIDERATION OF LATE PROPOSALS WHICH WERE SENT AT LEAST 5
DAYS PRIOR TO THE CLOSING DATE FOR RECEIPT OF PROPOSALS BY CERTIFIED OR
REGISTERED MAIL OR WHERE THE SOLE OR PARAMOUNT CAUSE OF DELAY IS
GOVERNMENT MISHANDLING AFTER RECEIPT AT THE GOVERNMENT INSTALLATION.
FEDERAL PROCUREMENT REGULATIONS SEC. 1-2.201(A)(31) (1964 ED.).
HUBBS-SEA CONTENDS THAT ITS PROPOSAL SHOULD BE CONSIDERED BECAUSE IT
WAS SENT BY EXPRESS MAIL AND THE POSTAL SERVICE FAILED TO MAKE DELIVERY
AS GUARANTEED. WE DISAGREE. EXPRESS MAIL DELIVERY DOES NOT FALL WITHIN
THE LATE PROPOSAL EXCEPTIONS. RECEIPT BY THE POSTAL SERVICE IS NOT
RECEIPT AT THE GOVERNMENT INSTALLATION, EXPRESS MAIL IS NOT THE
EQUIVALENT OF REGISTERED OR CERTIFIED MAIL, AND, IN ANY EVENT, HUBBS-SEA
MAILED ITS PROPOSAL 1 DAY, RATHER THAN 5 DAYS, BEFORE PROPOSALS WERE
DUE. SIGMA TREATMENT SYSTEMS, SUPRA; SEE GERONIMO SERVICE COMPANY,
B-199864, OCTOBER 28, 1980, 80-2 CPD 325.
HUBBS-SEA CONTENDS THAT THE CONTRACTING OFFICER SHOULD HAVE
DISPATCHED A COURIER TO PICK UP THE PROPOSAL UPON BEING NOTIFIED THAT IT
WAS BEING SENT BY EXPRESS MAIL. WE INITIALLY NOTE THAT THE CONTRACTING
OFFICER WAS ASKED TO ACKNOWLEDGE RECEIPT RATHER THAN TO PICK UP THE
PROPOSAL. THE CONTRACTING OFFICER THEREFORE HAD NO REASON TO BELIEVE
THE PROPOSAL WOULD NOT BE DELIVERED. MORE SIGNIFICANTLY, THE
CONTRACTING OFFICER HAD NO OBLIGATION TO PROVIDE SUCH EXTRAORDINARY
ASSISTANCE. WE HAVE HELD THAT THE PROCURING AGENCY IS NOT REQUIRED TO
ACKNOWLEDGE RECEIPT. TENAVISION INC., B-207977, JULY 20, 1982, 82-2 CPD
64; X-TYAL INTERNATIONAL CORPORATION, B-202434, JANUARY 7, 1982, 82-1
CPD 19. IT CERTAINLY FOLLOWS THAT THE PROCURING AGENCY NEED NOT TAKE
THE EXTRAORDINARY ACTION OF SEARCHING FOR AN OFFEROR'S PROPOSAL WHICH
HAS NOT YET BEEN RECEIVED AT THE GOVERNMENT INSTALLATION. AS WE NOTED
ABOVE, IT IS THE OFFEROR'S RESPONSIBILITY TO ASSURE THE TIMELY RECEIPT
OF ITS PROPOSAL.
HUBBS-SEA'S FINAL GROUND OF PROTEST IS THAT THE 8:20 A.M. PICKUP TIME
HAD THE EFFECT OF SHORTENING THE 3 P.M. DEADLINE TO 8:20 A.M. WE
DISAGREE. PROPOSALS WERE RECEIVED UNTIL 3 P.M. BY NOAA AND IT WAS ONLY
HUBBS-SEA'S CHOICE OF DELIVERY METHOD WHICH MADE THE PROPOSAL LATE.
OUR OFFICE GENERALLY REQUESTS A REPORT FROM THE PROCURING AGENCY UPON
RECEIPT OF A PROTEST AND WITHHOLDS ISSUING A DECISION PENDING RECEIPT
AND REVIEW OF THE REPORT. SEE 4 C.F.R. SEC. 21.3 (1982). HOWEVER,
WHERE IT IS CLEAR FROM A PROTESTER'S INITIAL SUBMISSION THAT THE PROTEST
IS WITHOUT LEGAL MERIT, THE MATTER WILL BE DECIDED SUMMARILY.
TENAVISION INC., SUPRA.
THE PROTEST IS SUMMARILY DENIED.
B-210578, FEB 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. A BID THAT OFFERS A BID ACCEPTANCE PERIOD LESS THAN THAT REQUIRED
IN THE INVITATION FOR BIDS IS NONRESPONSIVE, AND CANNOT BE CHANGED AFTER
OPENING TO CONFORM TO THE INVITATION'S REQUIREMENT, SINCE A
NONRESPONSIVE BID CANNOT BE CORRECTED.
2. WHERE A BID IS NONRESPONSIVE BECAUSE IT OFFERED AN ACCEPTANCE
PERIOD SHORTER THAN THE INVITATION FOR BIDS REQUIRED, THE FACT THAT
AWARD WAS MADE TO ANOTHER, RESPONSIVE FIRM WITHIN THE SHORTER PERIOD IS
IRRELEVANT. A BID'S NONRESPONSIVENESS IS DETERMINED AT BID OPENING, AND
CANNOT DEPEND ON THE FORTUITY THAT THE GOVERNMENT COMPLETES THE
SELECTION PROCESS SOONER THAN ANTICIPATED IN THE INVITATION.
AMES CONSTRUCTION, INC.:
AMES CONSTRUCTION, INC. PROTESTS THE REJECTION OF ITS BID AS
NONRESPONSIVE UNDER INVITATION FOR BIDS (IFB) NO. 3-SB-60-00020/DC-7520
ISSUED BY THE DEPARTMENT OF THE INTERIOR FOR CERTAIN CONSTRUCTION WORK.
INTERIOR REJECTED AMES' BID BECAUSE THE FIRM STIPULATED A BID ACCEPTANCE
PERIOD OF 30 CALENDAR DAYS, INSTEAD OF THE 60-CALENDAR DAY PERIOD
REQUIRED BY THE IFB. AMES CLAIMS IT ACTUALLY INTENDED THAT THE BID BE
AVAILABLE FOR ACCEPTANCE THE FULL 60 DAYS, AND POINTS OUT THAT THE
CONTRACT IN FACT WAS AWARDED WITHIN 30 DAYS AFTER BID OPENING.
WE SUMMARILY DENY THE PROTEST.
THE IFB STATED THAT BIDS OFFERING ACCEPTANCE PERIODS OF LESS THAN 60
DAYS WOULD BE REJECTED AS NONRESPONSIVE, AND PROVIDED AN UNDERSCORED
SPACE FOR A BIDDER TO INDICATE THE NUMBER OF CALENDAR DAYS ITS BID WOULD
REMAIN OPEN FOR ACCEPTANCE. ON THE SAME PAGE, THE IFB PROVIDED THAT THE
BIDDER MUST AGREE, IF AWARDED THE CONTRACT, TO BEGIN WORK WITHIN 30
CALENDAR DAYS AFTER RECEIPT OF A NOTICE TO PROCEED; THE NUMBER "30" WAS
PREPRINTED IN AN UNDERSCORED SPACE. AMES MISTAKENLY INSERTED "30" IN THE
BID ACCEPTANCE PERIOD UNDERSCORED SPACE BECAUSE IT NOTED THE PREPRINTED
"30" IN THE OTHER UNDERSCORED SPACE ON THE PAGE. AFTER BID OPENING, THE
FIRM REALIZED ITS MISTAKE AND ADVISED THE CONTRACTING OFFICER THAT IT
INTENDED THAT THE BID REMAIN OPEN FOR ACCEPTANCE THE FULL 60 DAYS.
WE CONSISTENTLY HAVE HELD THAT A PROVISION IN AN IFB WHICH REQUIRES
THAT A BID REMAIN AVAILABLE FOR ACCEPTANCE BY THE GOVERNMENT FOR A
PRESCRIBED PERIOD OF TIME IN ORDER TO BE CONSIDERED FOR AWARD IS A
MATERIAL REQUIREMENT, AND THAT A FAILURE TO MEET THAT REQUIREMENT THUS
RENDERS THE BID NONRESPONSIVE. SEE, E.G., 48 COMP.GEN. 19 (1968). TO
HOLD OTHERWISE AFFORDS THE BIDDER THAT LIMITED ITS BID ACCEPTANCE PERIOD
AN UNFAIR ADVANTAGE OVER ITS COMPETITORS BECAUSE THAT BIDDER HAS THE
OPTION TO REFUSE THE AWARD AFTER THE TIME SET IN ITS BID HAS EXPIRED IN
THE EVENT OF, FOR EXAMPLE, UNANTICIPATED INCREASES IN COSTS. ON THE
OTHER HAND, BIDDERS COMPLYING WITH THE REQUIRED ACCEPTANCE PERIOD WOULD
NOT HAVE THAT OPTION BUT WOULD BE BOUND BY THE GOVERNMENT'S ACCEPTANCE
ANY TIME WITHIN THE PERIOD REQUIRED IN THE INVITATION. SEE MILES METAL
CORPORATION, 54 COMP.GEN. 750 (1975), 75-1 CPD 145. IN THIS RESPECT,
THE NONRESPONSIVE BIDDER'S PRICE PRESUMABLY REFLECTS ITS LIMITATION OF
THE PERIOD THE BID PRICE WILL BE SUBJECT TO THE RISK OF THE MARKETPLACE.
SEE HILD FLOOR MACHINE CO., INC., B-196419, FEBRUARY 19, 1980, 80-1 CPD
140.
AMES, WHILE RECOGNIZING THE ABOVE-STATED RULE, CONTENDS THAT THE BID
NONETHELESS CAN BE CONSIDERED IN VIEW OF OUR DECISION IN ESKO & YOUNG,
INC., 61 COMP.GEN. 192 (1982), 82-1 CPD 5. THAT CASE INVOLVED AN IFB
WHICH REQUIRED A 30-DAY BID ACCEPTANCE PERIOD, AND A SINGLE BIDDER, WHO
OFFERED ONLY A 10-DAY ACCEPTANCE PERIOD. WE PERMITTED CONSIDERATION OF
THE BID BECAUSE THE RATIONALE FOR CONSIDERING COMPLIANCE WITH A REQUIRED
ACCEPTANCE PERIOD TO BE A MATERIAL BIDDING REQUIREMENT DID NOT APPLY.
THE REASON IS THAT NO BIDDING ADVANTAGE ACCRUES TO THE SINGLE BIDDER
SINCE THERE ARE NO COMPETITORS WHO, IN CONTRAST, SUBJECTED THEMSELVES TO
THE RISKS OF MAINTAINING THEIR BID PRICES FOR THE LONGER PERIOD. AMES
ARGUES THAT IT ALSO ENJOYED NO ADVANTAGE OVER ITS COMPETITORS SINCE IT
ADVISED THE CONTRACTING OFFICER AFTER BID OPENING THAT IT WOULD KEEP THE
BID OPEN FOR 60 DAYS, AND SINCE THE CONTRACT IN FACT WAS AWARDED WITHIN
THE 30-DAY PERIOD.
WE FIND NO LEGAL MERIT TO AMES' POSITION. THE TEST OF RESPONSIVENESS
IS WHETHER THE BID, AT THE TIME OF BID OPENING, REPRESENTS AN
UNEQUIVOCAL OFFER TO CONFORM TO THE IFB'S MATERIAL TERMS AND CONDITIONS.
SEE TIMBERLAND PAVING & CONSTRUCTION CO., B-205179, JUNE 21, 1982, 82-1
CPD 608. IN ESKO & YOUNG, THE BID ACCEPTANCE PERIOD WAS NOT A MATERIAL
TERM AT BID OPENING, SINCE THE LACK OF ANY BIDDERS OTHER THAN THE
PROTESTER RENDERED INAPPLICABLE ANY RATIONALE FOR CONSIDERING THE
REQUIREMENT MATERIAL. HERE, HOWEVER, AMES WAS NOT THE ONLY FIRM THAT
BID IN RESPONSE TO THE IFB, SO AT BID OPENING THE REQUIRED BID
ACCEPTANCE PERIOD WAS A MATERIAL TERM FOR THE REASONS EXPRESSED ABOVE.
MOREOVER, THE FACT THAT THE FIRM SUBSEQUENTLY EXPLAINED THAT THE
30-DAY PERIOD IT OFFERED WAS A MISTAKE, AND THAT IT ACTUALLY INTENDED TO
KEEP THE BID OPEN FOR 60 DAYS, IS IRRELEVANT TO THE RESPONSIVENESS OF
THE BID. A BID WHICH IS NONRESPONSIVE ON ITS FACE MAY NOT BE CHANGED,
CORRECTED OR EXPLAINED BY THE BIDDER AFTER BID OPENING. TO ALLOW THE
BIDDER TO DO SO WOULD PERMIT THE FIRM TO ACCEPT OR REJECT A CONTRACT
AFTER BIDS ARE EXPOSED BY CORRECTING OR REFUSING TO CORRECT ITS BID.
SEE VIN CONSTRUCTION COMPANY, INC., B-206526, JUNE 30, 1982, 82-1 CPD
637.
FINALLY, THE FACT THAT THE GOVERNMENT ACTUALLY AWARDED THE CONTRACT
WITHIN 30 DAYS AFTER BID OPENING ALSO IS NOT RELEVANT TO THE BID'S
RESPONSIVENESS. THE PURPOSE OF REQUIRING A PARTICULAR BID ACCEPTANCE
PERIOD IS TO INSURE THE GOVERNMENT ADEQUATE TIME AFTER BID OPENING FOR
BID EVALUATION AND OTHER PREAWARD PROCESSING. SEE FEDERAL PROCUREMENT
REGULATIONS SEC. 1-2.201(A)(15) (1964 ED.). AGAIN, HOWEVER,
RESPONSIVENESS IS A MATTER OF A BID'S ACCEPTABILITY AS SUBMITTED AND
OPENED. IT CANNOT DEPEND ON THE SUBSEQUENT FORTUITY THAT THE GOVERNMENT
COMPLETES THE SELECTION PROCESS SOONER THAN ANTICIPATED BY THE
INVITATION AS ISSUED. THE FIRM'S BID PRICE STILL REFLECTS THE BIDDER'S
LIMITATION OF ITS RISK THROUGH THE OFFER OF A SHORTER ACCEPTANCE PERIOD
THAN ITS COMPETITORS OFFERED IN THEIR PROPER RESPONSES TO THE IFB. SEE
HILD FLOOR MACHINE CO., INC., SUPRA.
AMES HAS REQUESTED A CONFERENCE ON THE PROTEST PURSUANT TO SECTION
21.7 OF OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.7 (1982). WE HAVE
DECIDED THE PROTEST BASED ONLY ON THE FIRM'S INITIAL SUBMISSION,
HOWEVER, SINCE IT IS CLEAR FROM THE SUBMISSION THAT THE PROTEST LACKS
LEGAL MERIT. A CONFERENCE THEREFORE WOULD SERVE NO USEFUL PURPOSE.
MEDICAL GAS & RESPIRATORY SERVICES, INC., B-207360, JUNE 2, 1982, 82-1
CPD 529.
THE PROTEST IS DENIED.
B-210577, FEB 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. NO BASIS EXISTS TO PRECLUDE A CONTRACT AWARD MERELY BECAUSE THE
LOW BIDDER SUBMITTED A BELOW-COST BID.
2. GAO WILL NOT REVIEW AFFIRMATIVE DETERMINATION OF RESPONSIBILITY
EXCEPT IN LIMITED CIRCUMSTANCES.
SUN TEMPORARY SERVICES:
SUN TEMPORARY SERVICES PROTESTS THE AWARD OF A CONTRACT BY THE
GENERAL SERVICES ADMINISTRATION, OFFICE OF PERSONAL PROPERTY, TO ANYBODY
ANYTIME, INC., UNDER SOLICITATION NO. 2YCG-JMB-A-A0105.
THE BASIS OF THE PROTEST IS THAT THE CONTRACT ESSENTIALLY IS A LOSS
CONTRACT. HOWEVER, THE PRACTICE OF BELOW-COST BIDDING IS NOT ILLEGAL
AND THE GOVERNMENT CANNOT WITHHOLD OR DISTURB AN AWARD MERELY BECAUSE
THE LOW OFFER IS BELOW COST. TEAMSTER LOCAL NO. 270, B-208634,
SEPTEMBER 15, 1982, 82-2 CPD 230. WHETHER THE LOW BIDDER CAN PERFORM
THE CONTRACT AT THE BID PRICE IS A MATTER OF RESPONSIBILITY OF THE
BIDDER. OUR OFFICE DOES NOT REVIEW PROTESTS CONCERNING AFFIRMATIVE
DETERMINATIONS OF RESPONSIBILITY ABSENT A SHOWING THAT THE CONTRACTING
OFFICER ACTED FRAUDULENTLY OR IN BAD FAITH OR THAT DEFINITIVE
RESPONSIBILITY CRITERIA IN THE SOLICITATION HAVE NOT BEEN MET. TEAMSTER
LOCAL NO. 270, SUPRA. NEITHER EXCEPTION IS ALLEGED HERE.
ACCORDINGLY, WE DISMISS THE PROTEST.
B-210572, JUL 26, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. UNDER FEDERAL TRAVEL REGULATIONS
PARA. 2-3.1, MISCELLANEOUS EXPENSES INCURRED BECAUSE OF A TRANSFER
MAY BE REIMBURSED. THE EMPLOYEE MAY BE REIMBURSED FOR (1) HIS
WIFE'S TEACHER CERTIFICATION FEE AS A LICENSE FEE, AND (2) HIS
WIFE'S TEACHER COURSE TUITION FEE WHICH WAS REQUIRED AS A
CONDITION PRECEDENT TO THE ISSUANCE OF THE TEACHER CERTIFICATION,
WHERE EMPLOYEE'S WIFE HAD BEEN A CERTIFIED TEACHER IN STATE IN
WHICH OLD DUTY STATION WAS LOCATED.
2. UNDER FEDERAL TRAVEL REGULATIONS
PARA. 2-3.1, MISCELLANEOUS EXPENSES INCURRED BECAUSE OF A TRANSFER
MAY BE REIMBURSED, BUT THOSE COSTS INCURRED FOR REASONS OF
PERSONAL TASTE OR PREFERENCE AND NOT REQUIRED BECAUSE OF THE MOVE
MAY NOT BE REIMBURSED. THE EMPLOYEE MAY NOT BE ALLOWED
REIMBURSEMENT OF A MEDICAL RECORDS TRANSFER FEE, SINCE TRANSMITTAL
FEES ARE REIMBURSABLE ONLY WHEN THE SUBJECT OF THE TRANSMITTAL IS
A REIMBURSABLE EXPENSE, AND EXPENSES RELATING GENERALLY TO MEDICAL
ARRANGEMENTS OF TRANSFERRED EMPLOYEES ARE NOT REIMBURSABLE.
DONALD W. HALEY - MISCELLANEOUS EXPENSES - TEACHER CERTIFICATION FEE
- MEDICAL RECORDS TRANSFER FEE:
THIS DECISION ARISES FROM A REQUEST BY MS. ANITA R. SMITH, AUTHORIZED
CERTIFYING OFFICER, NATIONAL FINANCE CENTER, UNITED STATES DEPARTMENT OF
AGRICULTURE, FOR AN ADVANCE DECISION AS TO WHETHER DONALD W. HALEY, AN
EMPLOYEE OF THE AGENCY, MAY BE REIMBURSED FOR VARIOUS MISCELLANEOUS
EXPENSES IN THE AMOUNT OF $216.75 THAT HE INCURRED IN RELOCATING
PURSUANT TO A PERMANENT CHANGE OF STATION.
MR. HALEY, AN EMPLOYEE OF THE SOIL CONSERVATION SERVICE, WAS
AUTHORIZED A PERMANENT CHANGE OF STATION FROM AMHERST, MASSACHUSETTS, TO
DURHAM, NEW HAMPSHIRE. MR. HALEY CLAIMS HE INCURRED THE FOLLOWING
MISCELLANEOUS EXPENSES FOR WHICH HE HAS NOT BEEN REIMBURSED: A TEACHER
CERTIFICATION FEE OF $30 AND A TUITION FEE OF $177 FOR HIS WIFE; AND A
MEDICAL RECORDS TRANSFER FEE OF $9.75 FOR HIS TWO CHILDREN. FOR THE
REASONS STATED BELOW, WE FIND THAT MR. HALEY MAY BE REIMBURSED FOR THE
TEACHER CERTIFICATION FEE AND THE TUITION FEE, BUT NOT THE MEDICAL
RECORDS TRANSFER FEE.
EMPLOYEES WHO ARE TRANSFERRED IN THE INTEREST OF THE GOVERNMENT AND
PAID EXPENSES OF TRAVEL AND TRANSPORTATION UNDER 5 U.S.C. SEC. 5724(A)
(1976), ARE ENTITLED TO REIMBURSEMENT FOR CERTAIN MISCELLANEOUS EXPENSES
UNDER 5 U.S.C. 5724A(B). THE ALLOWANCE FOR MISCELLANEOUS EXPENSES IS
PAYABLE IN ACCORDANCE WITH THE REGULATIONS CONTAINED IN THE FEDERAL
TRAVEL REGULATIONS, FPMR 101-7 (MAY 1973) (FTR), CHAPTER 2, PART 3.
MR. HALEY'S WIFE WAS A CERTIFIED TEACHER IN MASSACHUSETTS AND WAS
EMPLOYED AS A TEACHER AT THE TIME OF MR. HALEY'S TRANSFER. IN ORDER TO
QUALIFY FOR CERTIFICATION IN NEW HAMPSHIRE, SHE WAS REQUIRED BY THE
DEPARTMENT OF EDUCATION OF THE STATE OF NEW HAMPSHIRE TO TAKE A
MAINTENANCE COLLEGE COURSE AT A COST OF $177. SHE ALSO WAS REQUIRED TO
PAY A FEE OF $30 FOR HER NEW HAMPSHIRE TEACHING CERTIFICATE. ALSO, MR.
HALEY PAID $9.75 TO TRANSFER THE GENERAL MEDICAL RECORDS OF HIS TWO
CHILDREN TO HIS NEW OFFICIAL STATION.
TEACHER CERTIFICATION FEE. A TEACHER CERTIFICATION FEE IS SIMILAR TO
OTHER LICENSE FEES THAT WE HAVE HELD ARE REIMBURSABLE AS A COST INHERENT
IN THE RELOCATION OF A PLACE OF RESIDENCE. SEE B-163107, MAY 18, 1973,
(AMATEUR RADIO LICENSE TRANSFER FEE); CYRUS E. PHILLIPS IV, B-205695,
AUGUST 2, 1982 (DOG LICENSE). ON THIS BASIS, THE TEACHER CERTIFICATION
FEE MAY BE REIMBURSED.
TUITION FEE FOR MAINTENANCE COLLEGE COURSE. WE HAVE HELD THAT
EXPENSES REQUIRED AS A CONDITION PRECEDENT TO THE ISSUANCE OF A LICENSE
MAY BE REIMBURSED AS PART OF THE COST OF OBTAINING THE LICENSE. SEE
CYRUS E. PHILLIPS IV, (VETERINARY COSTS INCURRED AS CONDITION PRECEDENT
TO DOG LICENSE); B-178070, APRIL 6, 1973 (DRIVERS' TRAINING COURSE
REQUIRED AS CONDITION PRECEDENT TO OBTAINING A DRIVER'S LICENSE). THE
NEW HAMPSHIRE DEPARTMENT OF EDUCATION INDICATED TO MR. HALEY'S WIFE THAT
SHE WAS REQUIRED TO TAKE THE MAINTENANCE COLLEGE COURSE IN ORDER TO
DEMONSTRATE "SATISFACTORY PROFESSIONAL GROWTH," AS DESCRIBED IN A
DOCUMENT FROM THE OFFICE OF TEACHER EDUCATION AND PROFESSIONAL
STANDARDS. SINCE MR. HALEY'S WIFE WAS REQUIRED TO TAKE THE MAINTENANCE
COLLEGE COURSE AS A CONDITION PRECEDENT TO RECEIVING HER TEACHER
CERTIFICATION AT MR. HALEY'S NEW DUTY STATION, THE TUITION FEE WOULD BE
ALLOWABLE UNDER THE RULE IN THE ABOVE DECISIONS.
TRANSFER OF MEDICAL RECORDS. WE HAVE HELD THAT THE COST OF
TRANSMITTING DOCUMENTS MAY ONLY BE REIMBURSED WHERE THE PURPOSE OF THE
TRANSMITTAL RELATES TO AN ITEM THAT WOULD CONSTITUTE A REIMBURSABLE
EXPENSE. SEE CYRUS E. PHILLIPS IV, (TRANSMITTAL OF TRAVEL AUTHORIZATION
AND SERVICE AGREEMENT BY EXPRESS MAIL TO OBTAIN AN IMPREST FUND PAYMENT
ON ARRIVAL AT THE NEW STATION NOT ALLOWABLE); BRUCE L. BIRCHMAN,
B-194851, APRIL 8, 1980 (POSTAGE COSTS TO MAIL LICENSE PLATES TO
LOCATION OF FORMER DUTY STATION ALLOWABLE WHERE STATE LAW REQUIRED
RETURN OF THE LICENSE PLATES). HERE, THE MEDICAL RECORDS NEITHER WERE
PART OF A FULLY PAID MEDICAL CONTRACT (SEE JOSEPH T. GRILLS, 56
COMP.GEN. 53 (1976)) NOR WERE REQUIRED TO BE TRANSMITTED BY LAW, AND
THEY, THUS, DID NOT CONSTITUTE AN ALLOWABLE EXPENSE IN THEMSELVES.
THEREFORE, THE TRANSFER FEE IS NOT REIMBURSABLE AS A MISCELLANEOUS
EXPENSE.
MR. HALEY'S CLAIM FOR CERTAIN MISCELLANEOUS EXPENSES MAY BE PARTIALLY
REIMBURSED IN ACCORDANCE WITH THIS DECISION.
B-210561, SEP 13, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
EMPLOYEE OF DEPARTMENT OF ENERGY WHO
MOVED HIS HOUSEHOLD GOODS INCIDENT TO A
TRANSFER AND KNEW HE WOULD BE LIABLE
FOR EXCESS WEIGHT CHARGES, CLAIMS THE
DIFFERENCE BETWEEN THE OVERWEIGHT
CHARGES AS REPRESENTED TO HIM BASED ON
RATES EFFECTIVE IN MAY AND THE OVERWEIGHT
CHARGES ACTUALLY CHARGED THE
DEPARTMENT UNDER NEW RATES EFFECTIVE IN
JUNE WHEN THE SHIPMENT WAS MADE. THE
OVERWEIGHT CHARGES THE MOVER BILLED THE
DEPARTMENT WERE CORRECT AND THE MOVER
WAS REQUIRED BY THE INTERSTATE COMMERCE
ACT TO COLLECT THEM. SINCE THE DEPARTMENT
WAS REQUIRED BY THE FEDERAL TRAVEL
REGULATIONS TO COLLECT FROM THE
EMPLOYEE ANY EXCESS WEIGHT CHARGES IT
PAID, THERE IS NO BASIS FOR ALLOWANCE
OF THE CLAIM.
THERON M. BRADLEY, JR.:
THE QUESTION IN THIS CASE IS WHETHER MR. THERON M. BRADLEY, JR., AN
EMPLOYEE OF THE PITTSBURGH NAVAL REACTORS OFFICE, DEPARTMENT OF ENERGY,
MUST PAY THE DIFFERENCE BETWEEN THE COST OF MOVING HIS OVERWEIGHT
HOUSEHOLD GOODS AS REPRESENTED TO HIM BASED ON THE MOVER'S RATES WHICH
WERE IN EFFECT IN MAY 1982 AND THE COST THE MOVER ACTUALLY CHARGED BASED
ON RATES IN EFFECT IN JUNE 1982 WHEN THE SHIPMENT WAS MADE. SINCE THE
COST DIFFERENTIAL WAS BASED ON RATES PROPERLY SUBMITTED TO THE GENERAL
SERVICES ADMINISTRATION UNDER THE CENTRALIZED HOUSEHOLD GOODS TRAFFIC
MANAGEMENT PROGRAM AND CONTAINED IN A RATE TENDER FILED WITH THE
INTERSTATE COMMERCE COMMISSION, THE MOVER WAS REQUIRED BY THE INTERSTATE
COMMERCE ACT TO COLLECT IT FROM THE NAVAL REACTORS OFFICE, AND THAT
OFFICE WAS REQUIRED BY THE FEDERAL TRAVEL REGULATIONS (FTR) TO COLLECT
IT FROM THE EMPLOYEE. THEREFORE, THERE IS NO BASIS FOR THE ALLOWANCE OF
MR. BRADLEY'S CLAIM FOR THE AMOUNT COLLECTED FROM HIM. THE EQUITIES
WARRANT REPORTING THE CLAIM TO CONGRESS UNDER 31 U.S.C. SEC. 3702(D).
THE AUTHORIZED CERTIFYING OFFICER, PITTSBURGH NAVAL REACTORS OFFICE,
DEPARTMENT OF ENERGY, PRESENTED THE QUESTION.
MR. BRADLEY WAS TRANSFERRED IN JANUARY 1982 FROM WASHINGTON, D.C., TO
IDAHO FALLS, IDAHO. HE MADE TWO SHIPMENTS OF HOUSEHOLD GOODS INCIDENT
TO THAT TRANSFER TOTALING OVER 23,000 POUNDS. THE FIRST SHIPMENT,
WEIGHING 6,120 POUNDS, WAS MADE IN JANUARY 1982. THE SECOND SHIPMENT,
WHICH WEIGHTED 17,000 POUNDS AND MOVED BETWEEN WASHINGTON AND IDAHO
FALLS IN JUNE 1982, IS THE SUBJECT OF THIS DISPUTE. MR. BRADLEY KNEW
THAT THE WEIGHT OF HIS HOUSEHOLD GOODS STILL IN WASHINGTON, WHEN
COMBINED WITH THE WEIGHT OF THE FIRST SHIPMENT, WAS OVER THE
11,000-POUND LIMIT PRESCRIBED IN PARA. 2-8.2, FTR (NOVEMBER 1, 1981)
THAT COULD BE TRANSPORTED ON HIS BEHALF AT GOVERNMENT EXPENSE. WHEN HE
TALKED WITH THE NAVAL REACTORS OFFICE'S TRANSPORTATION OFFICER ABOUT THE
PROCEDURES TO BE USED IN MOVING HIS HOUSEHOLD GOODS IN THE CENTRALIZED
HOUSEHOLD GOODS TRAFFIC MANAGEMENT PROGRAM, HE WAS INTERESTED IN
MINIMIZING COSTS BECAUSE HE KNEW THAT HE WOULD BE PAYING THE COSTS OF
THE EXCESS WEIGHT OVER 11,000 POUNDS. HE STATES THAT IN RELIANCE ON THE
DISCUSSIONS WITH THE TRANSPORTATION OFFICER AND THE MOVER ABOUT COSTS,
HE DECIDED HOW MUCH OF THE HOUSEHOLD GOODS TO SELL AND HOW MUCH TO PAY
TO MOVE.
THE CENTRALIZED HOUSEHOLD GOODS TRAFFIC MANAGEMENT PROGRAM,
IMPLEMENTED BY 41 C.F.R. SUBPART 101-40.2, REQUIRES EACH AGENCY TO
OBTAIN A COST COMPARISON FOR EACH GOVERNMENT-FINANCED HOUSEHOLD GOODS
MOVE AND DETERMINE ON A COST BASIS WHETHER REIMBURSEMENT WILL BE
PROVIDED ACCORDING TO THE COMMUTED RATE SYSTEM DESCRIBED IN PARA.
2-8.3A OF THE FTR OR WHETHER THE GOODS WILL BE SHIPPED BY GOVERNMENT
BILL OF LADING (GBL) UNDER THE ACTUAL EXPENSE METHOD DESCRIBED IN PARA.
2-8.3B OF THE FTR. THE NAVAL REACTORS OFFICE PERFORMED THE COST
COMPARISON IN MID-MAY 1982, AND DETERMINED TO SHIP THE GOODS BY GBL.
MR. BRADLEY, AFTER DISCUSSIONS WITH THE TRANSPORTATION OFFICER, SELECTED
THE AVAILABLE MOVER WITH THE LOWEST RATE ($19.68 PER HUNDRED POUNDS)
FILED UNDER THE CENTRALIZED HOUSEHOLD GOODS TRAFFIC MANAGEMENT PROGRAM
ON THE BASIS OF THE COST COMPARISON. THE NAVAL REACTORS OFFICE THEN
ISSUED A GBL TO THE MOVER IN MAY TO EFFECT THE MOVE IN MID-JUNE. THE
SELECTED MOVER BILLED IN JULY FOR THE MOVE ON THE BASIS OF A RATE OF
$41.93 PER HUNDRED POUNDS, WHICH MORE THAN DOUBLED THE COST OF THE
EXCESS WEIGHT FOR MR. BRADLEY. THE GENERAL SERVICES ADMINISTRATION, THE
AGENCY WITH WHICH MOVERS PARTICIPATING IN THE CENTRALIZED HOUSEHOLD
GOODS TRAFFIC MANAGEMENT PROGRAM FILE RATES, VERIFIED THE $41.93 RATE AS
BEING THE APPLICABLE RATE IN EFFECT AT THE TIME THE SHIPMENT MOVED IN
JUNE.
ALTHOUGH THE $19.68 RATE PER HUNDRED POUNDS THAT THE NAVAL REACTORS
OFFICE AND MR. BRADLEY USED FOR PLANNING PURPOSES IN MID-MAY WAS THE
APPLICABLE LOW RATE FOR THE MOVERS THAT WERE AVAILABLE UNDER THE
CENTRALIZED HOUSEHOLD GOODS TRAFFIC MANAGEMENT PROGRAM IN MAY, THE
MOVERS AT THAT TIME UNDER THE PROGRAM WERE ALLOWED TO CHANGE THEIR RATES
EACH MONTH. A RATE CHANGE FILED UNDER THE PROGRAM WITH THE GENERAL
SERVICES ADMINISTRATION NEAR THE END OF THE MONTH WOULD BECOME EFFECTIVE
THE FIRST WORKING DAY OF THE NEXT MONTH, AND THAT IS WHAT HAPPENED IN
THIS CASE. AFTER THE COST COMPARISON AND PLANNING ARRANGEMENTS HAD BEEN
MADE IN MID-MAY, THE MOVER FILED A RATE CHANGE LATER IN MAY WHICH BECAME
EFFECTIVE IN JUNE WHEN MR. BRADLEY'S HOUSEHOLD GOODS WERE ACTUALLY
MOVED. MR. BRADLEY ARGUES THAT THE MID-MAY PLANNING ARRANGEMENTS BASED
ON THE $19.68 RATE WERE THE BASIS OF HIS DECISION TO SHIP AS MUCH OF HIS
HOUSEHOLD GOODS AS HE DID, AND HE POINTS OUT THE INEQUITY OF HAVING TO
PAY ON THE BASIS OF A RATE THAT MORE THAN DOUBLED WITHOUT HIS BEING
INFORMED BY HIS AGENCY OR THE MOVER ABOUT THE CHANGE OF CIRCUMSTANCES.
THE RATES THAT THE MOVER FILES WITH THE GENERAL SERVICES
ADMINISTRATION UNDER THE CENTRALIZED HOUSEHOLD GOODS TRAFFIC MANAGEMENT
PROGRAM ARE ALSO FILED WITH THE INTERSTATE COMMERCE COMMISSION, AND THE
CONTRACT OF CARRIAGE IS GOVERNED BY THE INTERSTATE COMMERCE ACT, AS
AMENDED, 49 U.S.C. SEC. 10101 ET SEQ. (SUPP. IV, 1980). THAT ACT IS A
COMPLEX REGULATORY SCHEME REQUIRING MANY THINGS OF MOVERS, ONE OF WHICH
IS TO COLLECT ONLY THE CHARGES SHOWN IN TARIFFS OR RATE TENDERS FILED
WITH THE INTERSTATE COMMERCE COMMISSION. SEE INTERPRETATION OF
GOVERNMENT RATE TARIFF FOR EASTERN CENTRAL MOTOR CARRIERS ASSN. INC.,
323 I.C.C. 347, 352 (1964). THE CHARGES THE MOVER BILLED TO THE NAVAL
REACTORS OFFICE ARE THE APPLICABLE ONES SHOWN IN A RATE TENDER FILED
WITH THE COMMISSION, AS VERIFIED BY THE GENERAL SERVICES ADMINISTRATION,
AND WERE CORRECTLY COLLECTED BY THE MOVER. THE COURT OF CLAIMS STATED
THE GENERAL RULE AS FOLLOWS:
"EVEN THOUGH A CARRIER MIGHT ERRONEOUSLY
QUOTE A PRICE TO BE CHARGED FOR SHIPMENT
OF GOODS, THE SHIPPER OR CONSIGNEE IS
NEVERTHELESS LIABLE FOR THE ACTUAL
PUBLISHED TARIFF RATE AND NOT THE PRICE
ERRONEOUSLY QUOTED TO IT. THIS IS TRUE
DESPITE THE FAULT OF THE CARRIER."
UNION PACIFIC RAILROAD CO. V. UNITED STATES, 490 F.2D 1385, 1391 (CT.
CL. 1974).
UNDER 5 U.S.C. SEC. 5724(A), AS IMPLEMENTED IN PARA. 2-8.2, FTR, THE
GOVERNMENT MAY NOT PAY THE EXPENSE OF SHIPPING IN EXCESS OF 11,000
POUNDS OF MR. BRADLEY'S GOODS. MR. BRADLEY IS RESPONSIBLE UNDER PARA.
2-8.3B(5), FTR, FOR PAYING THE DIFFERENCE BETWEEN THOSE CHARGES PAID BY
THE NAVAL REACTORS OFFICE AND HIS ENTITLEMENT OF 11,000 POUNDS.
ACCORDINGLY, SINCE THE MOVER CHARGED THE GOVERNMENT THE CORRECT AMOUNT
FOR MOVING MR. BRADLEY'S HOUSEHOLD GOODS UNDER THE APPLICABLE RATE
TENDER FILED WITH THE INTERSTATE COMMERCE COMMISSION, AND SINCE THE
GOVERNMENT WAS REQUIRED TO COLLECT FROM MR. BRADLEY THE CHARGES FOR THE
WEIGHT IN EXCESS OF 11,000 POUNDS, THERE IS NO BASIS FOR US TO ALLOW THE
CLAIM FOR THE DIFFERENCE BETWEEN THE APPLICABLE AND THE REPRESENTED
OVERWEIGHT CHARGES.
HOWEVER, AS INDICATED ABOVE, THE MATTER IS BEING REPORTED TO CONGRESS
PURSUANT TO 31 U.S.C. SEC. 3702(D).
B-210556, MAR 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
THE PROCUREMENT OF TRANSPORTATION THROUGH GROUP ARRANGEMENT BY A
TRAVEL AGENT IS AUTHORIZED UNDER FEDERAL TRAVEL REGULATIONS, PARAGRAPH
1-3.4B, WHICH IS AN EXCEPTION TO THE GENERAL RESTRICTION AGAINST THE USE
OF TRAVEL AGENTS FOR PROCUREMENT OF OFFICIAL GOVERNMENT TRAVEL; SEE 4
C.F.R. SEC. 52.3 (1982), WHERE AN AGENCY DETERMINES PRIOR TO THE TRAVEL
THAT THE USE OF REDUCED FARES RESULTS IN MONETARY SAVINGS TO THE
GOVERNMENT AND IS ADVANTAGEOUS TO THE GOVERNMENT.
EQUAL EMPLOYMENT OPPORTUNITY COMMISSION - USE OF TRAVEL AGENTS BY
DALLAS OFFICE:
A CERTIFYING OFFICER OF THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION
(EEOC) REQUESTS OUR OPINION ON WHETHER PAYMENT OF TWO PURCHASE ORDERS IS
PROPER. THESE PURCHASE ORDERS WERE ISSUED TO COVER THE PURCHASE OF
AIRLINE TICKETS THROUGH A TRAVEL AGENT FOR WITNESSES TESTIFYING FOR EEOC
IN COURT PROCEEDINGS IN TULSA, OKLAHOMA. EEOC ADVISES THAT THE PURCHASE
ORDERS WERE ISSUED TO THE TRAVEL AGENCY UNDER AN EEOC MEMORANDUM WHICH
ADVISED EEOC CONTRACTS DIVISION THAT:
"*** APPROPRIATE USE OF TRAVEL AGENTS AND/OR
PURCHASE ORDERS FOR AUTHORIZING *** TRAVEL *** WILL
RESULT IN BOTH A REDUCTION IN PAPERWORK,
TRAVEL VOUCHERS TO BE PROCESSED AND *** WILL
HELP REDUCE THE COSTS IN *** TRAVEL."
THE EEOC MEMORANDUM REFERENCED OUR DECISION IN EQUAL EMPLOYMENT
OPPORTUNITY COMMISSION - USE OF TRAVEL AGENTS, B-201258, DECEMBER 10,
1980. IN THAT DECISION, WE DETERMINED THAT ALTHOUGH EEOC MADE THE
FINDING AFTER THE TRAVEL WAS PERFORMED, SINCE EEOC DID DETERMINE THAT
USE OF REDUCED FARES IN THAT CASE RESULTED IN MONETARY SAVINGS TO THE
GOVERNMENT AND WAS ADVANTAGEOUS TO THE GOVERNMENT, THE PROCUREMENT OF
THE TRANSPORTATION THROUGH A GROUP ARRANGEMENT MADE BY A TRAVEL AGENT
WAS AUTHORIZED UNDER FEDERAL TRAVEL REGULATIONS (FTR), PARAGRAPH 1-3.4(
B), WHICH IS AN EXCEPTION TO THE GENERAL RESTRICTION AGAINST THE USE OF
TRAVEL AGENTS FOR PROCUREMENT OF OFFICIAL GOVERNMENT TRAVEL. SEE 4 C.
F.R. SEC. 52.3 (1982).
IN THAT DECISION, WE EXPLAINED THAT, WITH RESPECT TO CIVILIAN
EMPLOYEES OF THE UNITED STATES, PARAGRAPH 1-3.4(B) OF THE FTR PUBLISHES
PROVISIONS RELATING TO THE USE OF REDUCED FARES OFFERED BY THE CARRIERS
AND BY THE TRAVEL AGENTS. SUBPARAGRAPH (1) PROVIDES FOR THE USE OF THE
LOWER FARES OFFERED BY THE CARRIERS WHEN IT CAN BE DETERMINED PRIOR TO
THE START OF THE TRIP THAT SUCH SERVICES ARE PRACTICAL AND ECONOMICAL TO
THE GOVERNMENT. SUBPARAGRAPH (2) AUTHORIZES THE USE OF GROUP OR CHARTER
FARES SOLD BY TRAVEL AGENTS WHEN SUCH USE WILL NOT INTERFERE WITH THE
PERFORMANCE OF OFFICIAL BUSINESS. HOWEVER, AN ADMINISTRATIVE
DETERMINATION IS REQUIRED PRIOR TO THE TRAVEL THAT THE USE OF THE
REDUCED FARES WILL RESULT IN A MONETARY SAVINGS TO THE GOVERNMENT AND
WILL NOT INTERFERE WITH THE CONDUCT OF OFFICIAL BUSINESS.
THE EEOC CERTIFYING OFFICER APPARENTLY IS CONCERNED THAT OUR PRIOR
DECISION TO EEOC IS LIMITED TO THE FACTS AND IS NOT A MORE GENERAL
PRECEDENT FOR THE USE OF TRAVEL AGENTS. ALTHOUGH THE DECISION COVERED A
SPECIFIC CASE - USE OF TRAVEL AGENTS WHERE THE REQUIRED ADMINISTRATIVE
DETERMINATION APPROVING THE USE OF TRAVEL AGENTS WAS NOT MADE PRIOR TO
TRAVEL - AS NOTED IN THAT DECISION, THE FTR'S AND PRIOR DECISIONS OF
THIS OFFICE PERMIT USE OF GROUP OR CHARTER FARES OFFERED BY TRAVEL
AGENTS WHERE SUCH USE WILL NOT ADMINISTRATIVE DETERMINATION IS MADE
BEFORE THE TRAVEL IS PERFORMED THAT THE USE OF THESE REDUCED FARES WILL
RESULT IN MONETARY SAVINGS TO THE GOVERNMENT. EQUAL EMPLOYMENT
OPPORTUNITY COMMISSION - USE OF TRAVEL AGENTS, SUPRA; FTR PARAGRAPH
1-3.4(B); SEE ALSO 47 COMP.GEN. 104 (1967); OFFICE OF UNITED STATES
TRADE REPRESENTATIVE, B-201429, DECEMBER 30, 1980. HERE, BEFORE THE
TRAVEL WAS PERFORMED, THE REQUIRED ADMINISTRATIVE DETERMINATION WAS
MADE.
ON MARCH 10, 1981, PRIOR TO THE ISSUANCE OF THE PURCHASE ORDER, THE
EEOC DISTRICT DIRECTOR MADE AN ADMINISTRATIVE DETERMINATION THAT
PROCURING THE AIRLINE TICKETS FOR THE 17 WITNESSES FROM A TRAVEL AGENT
INSTEAD OF AIRLINES WOULD SAVE EEOC $378.83. THE DIRECTOR'S MEMORANDUM
STATES THAT USE OF THE TRAVEL AGENT WOULD NOT INTERFERE WITH THE CONDUCT
OF OFFICIAL BUSINESS AND WAS ADVANTAGEOUS TO THE AGENCY MISSION BY, FOR
EXAMPLE, HELPING TO ASSURE THAT THE WITNESSES FOR THE EEOC LAWSUIT WOULD
ARRIVE ON TIME. THE MEMORANDUM ALSO POINTS OUT AN ADDITIONAL SAVING OF
$163 ARRANGE THE TRAVEL.
SINCE EEOC COMPLIED WITH THE APPLICABLE FTR PARAGRAPH 1-3.4(B), AS
INTERPRETED BY OUR OFFICE, WE HAVE NO OBJECTION TO EEOC REIMBURSING THE
TRAVEL AGENT FOR THE COST OF THE TICKETS IF THE INVOICES ARE OTHERWISE
CORRECT.
B-210555.2 APRIL 8, 1986
DIGEST
VEHICLES - GOVERNMENT - HOME TO WORK TRANSPORTATION - GOVERNMENT
EMPLOYEES - PROHIBITION - EXEMPTIONS
1. The Chief of Protocol is not exempt from the home-to-work
transportation prohibition of 31 U.S.C. 1344 (1982). Although GAO
concluded in B-210555.2, September 1, 1983 that we would not at
that time "seek to distinguish between circumstances when it would
be permissible for the chief of protocol to use a Government car
for home-to-work travel and those when it would not be," it is now
impossible for this Office to accept less than full compliance
with the law.
The Honorable Ronald I. Spiers
Under Secretary of State for
Management
Department of State
Dear Mr. Spiers:
This is in response to your letter dated October 30, 1985. You
question the determination of this Office, put forth in our recent
report, "Use of Government Motor Vehicles for the Transportation of
Government Officials and the Relatives of Government Officials," GAO/
GGD-85-76, September 16, 1985, that Ms. Selwa Roosevelt, the Chief of
Protocol, had received Government home-to-work transportation to which
she was not entitled. Appendix II at 34. As set forth below, based on
the current law, it continues to be the position of this Office that the
Chief of Protocol is not exempt from the home-to-work transportation
prohibition. 31 U.S.C. Sec. 1344.
As your letter points out, this Office dealt with the issue of
home-to-work transportation of the Chief of Protocol in a 1983 letter to
your predecessor. B-210555.2, September 1, 1983. In that letter we
briefly reviewed our decision in 62 Comp. Gen. 438 (1983), in which we
held that except in certain narrowly limited circumstances, "agencies
may not properly exercise administrative discretion to provide
home-to-work transportation for their officers and employees, unless
otherwise provided by statute." 62 Comp. Gen. at 447. We also noted in
our September 1983 letter that, "in view of existing confusion regarding
application of the home-to-work restriction," we had temporarily
suspended enforcement with respect to agency heads and their principal
deputies until the end of the 98th Congress.
Finally, we reviewed the circumstances your office had brought to our
attention regarding the unusual nature of the duties of the Chief of
Protocol, including the frequency of late night and early morning
functions. We concluded, Accordingly, we will not at this time seek to
distinguish between circumstances when it would be permissible for the
Chief of Protocol to use a Government car for home-to-work travel and
those when it would not be." (Emphasis added.)
The temporary suspension of enforcement in Ms. Roosevelt's case, as
well as for non-cabinet agency heads and principal deputies of all
departments and agencies, was premised on the understanding that the
Administration would act promptly to propose legislation to amend
existing law to meet its special needs. However, the end of the 98th
Congress came and went, but no legislative amendments were sent forward
by the Administration until September, 1985.
Neither the Administration proposal nor the clean bill sponsored by
the House Government Operations Committee, H.R. 3614, which passed the
EIouse on March 4, 1986 and is now pending in the Senate, make specific
provision for a person in Ms. Roosevelt's position. While it is
possible that the President might choose to designate Ms. Roosevelt for
one of the 10 discretionary slots authorized to receive home-to-work
transportation, assuming that H.R. 3614 passes in its present form,
there is no assurance that this solution is imminent.
As our September 16, 1985 report indicates, it has become impossible
for this Office to continue to accept less than full compliance with the
present law. The home-to-work transportation prohibition of 31 U. S.C.
Sec. 1344 constitutes a "clear prohibition which cannot be waived or
modified by agency heads through regulations or otherwise." 62 Comp.
Gen. at 441. It is no longer reasonable to maintain that there is
confusion regarding application of the home-to-work restriction nor to
assert any longer that full enforcement should await final congressional
action. The fact that Government home-to-work transportation may result
in increased efficiency for the Government or convenience for the
official passenger is not sufficient to overcome the plain statutory
prohibition or to justify us in neglecting to apply a mandatory
provision of iaw.
In summary, the analysis you offered in your October 30 letter of the
duties and responsibilities of the Chief of Protocol states a reasonable
case for including that position among those legislatively exempt from
the home-to-work prohibition of 31 U.S.C. Sec. 1344. Nevertheless, as I
am sure you can appreciate, it was the responsibility of the
Administration to make her needs known to the Congress, and the
responsibility of the Congress, not this Office, to legislate regarding
which officials may receive home-to-work transportation in Government
vehicles. As the law now stands, the Chief of Protocol is not eligible
for Government home-to-work transportation.
Sincerely yours,
Acting Comptroller General
of the United States
B-210555.15 April 14, 1986
DIGEST
VEHICLES - GOVERNMENT - HOME TO WORK TRANSPORTATION - GOVERNMENT
EMPLOYEES
1. Persons "acting" in the position of an official entitled to
receive Government home-to-work transportation under 31 U.S.C.
Sec. 1344(b) or other statutes during his or her temporary absence
are not, in general, themselves entitled to receive home-to-work
transportation for that reason. The only exception occurs when
the position of an official entitled to home-to-work
transportation becomes vacant. The official "acting" in that
position becomes entitled to home-to-work transportation as the de
facto "head" of the agency.
VEHICLES - GOVERNMENT - HOME TO WORK TRANSPORTATION - GOVERNMENT
EMPLOYEES - PROHIBITION - EXEMPTIONS
2. With regard to home-to-work transportation provided the
Commandant and four District Commanders of the Coast Guard, the
Department of Transportation has sufficiently demonstrated the
elements necessary under GAO decisions for justifying an exception
to the home-to-work transportation prohibition for security
reasons.
Jim J. Marquez, Esq.
General Counsel
Department of Transportation
Dear Mr. Marquez:
This is in response to your letter dated November 19, 1985, taking
issue with certain conclusions in the recent report of this Office, "Use
of Government Vehicles for the Transportation of Government Officials
and the Relatives of Government Officia1s," GAO/GGD-85-76, September 16,
1985 (Report). You question our conclusion that persons "acting" in the
position of an official entitled to routine home-towork transportation
are not themselves entitled to home-towork transportation for that
reason. You also question our conclusion that home-to-work
transportation provided the Commandant and four District Commanders of
the Coast Guard did not meet the requirement of the'' security threat''
exception to the home-to-work prohibition, and accordingly was not
authorized.
As set forth below, it continues to be the position of this Office
that persons "acting" in the position of an official entitled to routine
home-to-work transportation are not, in general, themselves entitled to
routine home-to-work transportation. However, we now conclude that when
the position of an official entitled to home-to-work transportation
becomes vacant, the deputy official "acting" in that position becomes
entitled to home-to-work transportation as "head" of the agency. (The
same rationale would also apply in those limited instances when, by
statute, a non-agency head is authorized routine transportation to and
from work, e.g., the Deputy Secretary of Defense, and another official
"acts" in his place when the position becomes vacant.) With regard to
the home-to-work transportation provided the Commandant and four
District Commanders, we now conclude that the Department of
Transportation has sufficiently demonstrated the elements necessary
under our decisions for justifying an exception to the home-to-work
transportation prohibition for security reasons.
ACTING SECRETARY In our September 16, 1985 report, we
concluded, "Persons 'acting' in the position of an
official entitled to routine home-to-work
transportation are not themselves entitled to
home-to-work transportation for that reason.
The privilege of home-to-work transportation is
applicable only to persons officially occupying
the positions excepted in 31 U.S.C. Sec. 1344(b)."
(Report, Appendix II at 50.)
You contend, contrary to the position we took in our report, that the
Deputy Secretary of Transportation should be authorized home-to-work
transportation when he or she is "officially occupying the position of
Secretary of Transportation in an acting capacity when the Secretary is
absent or unable to serve or when the Office of the Secretary is
vacant." You point out that at 62 Comp. Gen. 438, 443 (1983) we held
that the exception to the home-to-work provision for agency heads
applied only to "those officers who are appointed (or who duly succeed)
to the positions designated by law to be !the heads of executive
departments' as listed in 5 U.S.C. Sec. 101." (Emphasis added.) You
contend that when the Deputy Secretary of Transportation becomes Acting
Secretary of Transportation, taking the place of the Secretary "when the
Secretary is absent or unable to perform or the position of Secretary is
vacant," the Deputy Secretary has "duly succeeded" to the position of
Secretary and accordingly should be eligible for routine home-to-work
transportation. You also point to the practical desirability of
maintaining communications with an Acting Secretary while he or she is
commuting.
We cannot concur in your analysis, except in the limited
circumstances in which the Deputy Secretary is acting as Secretary when
the position of Secretary is vacant due to the resignation, death, or
removal of the incumbent. It continues to be our position that when the
Deputy Secretary is acting for the Secretary, who remains in office but
is absent or otherwise unable to perform his or her duties, the Deputy
Secretary does not become eligible for routine home-to-work
transportation. A person "acting in the position" of a cabinet
secretary (or other official permitted by statute to utilize Government
cars for home-to-work purposes) during the temporary absence of such
official does not thereby become that official. In other words, the
acting Secretary of Transportation cannot be deemed to have "duly
succeeded" to the position of Secretary of Transportation while the
Secretary remains in office. While we are sympathetic to your views and
would be happy to see an amendment to the present law in legislation now
pending before the Congress which would authorize the position you
advocate, this is a matter for congrrssional consideration and is not
within GAO's power to accomplish without a change in the law.
SECURITY
You also question the conclusion in our September 16 report that the
Commandant and four District Commanders of the Coast Guard did not meet
the requirements of the "security threat" exception to the home-to-work
prohibition. It is the position of this Office that:
"The provision of home-to-work transportation
to government employees is permissible for
security reasons when: (1) there is a clear
and present danger of violent criminal activity
directed at the employ-ee in question, (2) there
is a showing that the provision of
transportation
in a Government car would provide
protection
not otherwise available, and (3) the
decision to provide home-to-work transportation
is made with circumspection and is not based on
speculative or remote fears of criminal
activity."
(Report, Appendix II at 50.)
Based on the limited information provided to us by the Department of
Transportation in response to our Government-wide survey, we were unable
to find in our September 18 report that the requirements of the
"security threat" exception had been met with regard to the Commandant
and the four District Commanders of the Coast Guard.
In your November 19 letter, however, you point out that the Commanant
and the District Commanders are responsible for directing the National
Narcotics Border Interdiction System and accordingly are "obvious
targets for violence and retaliation by persons involved in illegal drug
activities." Coast Guard intelligence has determined that there is a
continuing threat to the safety of these of ficers and that home-to-work
transporation is a "minimum standard of required protection under
current circumstances." The vehicles used for home-towork transportation
are equipped with special communications equipment and are operated by
drivers trained in evasive driving techniques. Based on this additional
information, we now conclude that the home-to-work transportation of the
Commandant and the District Commanders is justif ied under a "security
threat" exception to the prohibition of 31 U.S.C. Sec. 1344.
Sincerely yours,
Harry R. Van Cleve
General Counsel
B-210555.11 April 1, 1986
DIGEST
SAINT LAWRENCE SEAWAY DEVELOPEMENT CORPORATION - APPROPRIATIONS -
USER FEES - STATUS
The Saint Lawrence Seaway Development Corporation operates with
appropriated funds, despite the fact that the source of those funds is
user fees. Further the Corporation is a wholly owned Government
corporation, subject to the home-to-work transportation prohibition of
31 U.S.C. Sec. 1344. An analysis of the original 1946 act which enacted
the prohibition clearly indicates that wholly owned Government
corporations are subject to the prohibition. Subsequent codification of
Title 31 did not effect any change in substantive law.
Frederick A. Bush, Esq.
Chief Counsel
Saint Lawrence Seaway
Development Corportion
Dear Mr. Bush:
This is in response to your letter dated September 30, 1985 to Mr.
William J. Anderson, Director of our General Government Division. In
your letter, you argued that the Saint Lawrence Seaway Development
Corporation should be treated similarly to other Government corporations
which we found in a recent report to be not subject to the home-to-work
transportation prohibition of 31 U.S.C. Sec. 1344. See Use of
Government Motor Vehicles For The Transportation of Government Officials
and The Relatives of Government Officials, GAO/GGD-85-76, September 16,
1985. You conclude that "it would seem to follow that the General
Accounting Office would raise no objection to the Seaway Development
Corporation providing home-to-work transportation on the basis that !no
appropriated funds are used." As set forth below, we conclude that the
Seaway Development Corporation does operate with appropriated funds and
is therefore subject to the home-to-work transportation prohibition of
31 U.S.C. Sec. 1344. 1/
This Office dealt with the status of the funds available to the Saint
Lawrence Seaway Development Corporation in B-193573, December 19, 1979,
modifying in part, B-193573, January 8, 1979. In that case, we
reaffirmed our earlier conclusion that "the Corporation's funds are
appropriated funds, despite the fact that the source of such funds is
user fees." However, we also concluded that the Seaway Development
Corporation had "broad discretion in the obligation and expenditure of
its funds" in view of a provision in its enabling legislation, 33 U.S.
C. Sec. 984(a) (9), which permits the Corporation to:
"* * * determine the character of and the necessity for its
obligations and expenditures, and the manner in which they shall be
incurred, allowed and paid, subject to provisions of law specifically
applicable to Government corporations * * *."
We further concluded that this provision left the corporation
"subject only to restrictions on its use of appropriations that can be
directly implied from its enabling legislation, that are included in
appropriation acts applicable to the Corporation, or that are made
specifically applicable to Government corporations."
We now conclude that the home-to-work transportation prohibition of
31 U.S.C. Sec. 1344 is applicable to the Seaway Development Corporation
because it constitutes an appropriation restriction "made specifically
applicable to Government Corporations." The prohibition as codified at
31 U.S.C. Sec. 1344 is silent as to its applicability. However, when
the prohibition was first enacted, Pub. L. No. 600, Sec. 5, August 2,
1946, 60 Stat. 806, 810, it provided as follows:
"(c) Unless otherwise specifically provided, no appropriation
available for any department shall be expended--
* * * * *
" (2) for the maintenance, operation, and repair of any
Government-owned passenger motor vehicle or aircraft not used
exclusively for official purposes; and 'official purposes'shall not
include the transportation of officers and employees between their
domiciles and places of employment, except (medical officers and field
workers) and then only as to such latter cases when the same is approved
by the head of the department concerned." (Emphasis added.)
Section 18 of the 1946 Act, 60 Stat. 811, provided further:
"The word 'department' as used in this Act shall be construed to
include independent establishments, other agencies, wholly owned
Government corporations * * * and the government of the District of
Columbia, but shall not include the Senate, House of Representatives, or
office of the Architect of the Capitol, or the officers or employees
thereof." (Emphasis added.) Accordingly, the home-to-work transportation
prohibition is expressly applicable to wholly owned Government
corporations. Although the current codification of Title 31 does not
include the applicability distinctions contained in the original act,
the codification was not intended to effect any change in substantive
law. See Pub. L. No. 97-258, Sec. 4(a) 96 Stat. 877, 1067 (1982).
Accordingly, we conclude that wholly owned corporations are subject to
the home-to-work prohibition of 31 U.S.C. Sec. 1344. The Saint Lawrence
Seaway Development Corporation is a wholly owned Government corporation.
31 U.S.C. Sec. 9101(3)(K) (1982); B-190275, October 12, 1977. It is,
therefore, subject to the home-to-work restriction.
Sincerely yours,
Harry R. Van Cleve
General Counsel
FOOTNOTES
1/ We note that tne legal conclusions in our June 28 report regarding
the authority, or lack of authority, for the home-to-work transportation
of specific individuals represented the preliminary views of the General
Accounting Office, Office of General Counsel, based on its review of
information provided by agencies in response to our inquiries. Those
conclusions should not be treated as formal decisions of the Comptroller
General.
FILE: B-210555.10
DATE: August 19, 1985
DIGEST:
1. GAO has identified for Senator Proxmire, the Director of OMB and
his Deputy as individuals at OMB who have received home-to-work
transportation. Since White House did not respond to our inquiries, we
cannot verify whether incumbents of the same four positions reported to
Senator Proxmire 3 years ago are still using home-to-work
transportation.
2. No person at the Office of Management and Budget (OMB) or on the
White House staff may properly receive Government home-to-work
transportation. Such transportation is prohibited by 31 U.S.C. Section
1344, which exempts only a small group of high officials, not inluding
any person at OMB or on the White House staff. Specific home-to-work
prohibition included in HUD appropriation act does not indicate
congressional intent to exempt OMB officials. Assertion of "security
grounds" by OMB, without further explanation of the specific nature of
the threat and the added protection afforded by Government
transportation, does not establish circumstances warranting home-to-work
transportation. If security grounds are asserted by White House Staff,
similar justification must be provided. OMB Director is not entitled to
home-to-work transportation as the head of an agency listed in 5 U.S.C.
Section 101. Penalty for violation of 31 U.S.C. Section 1344 is
provided in 31 U.S.C. Section 1349(b).
The Honorable William Proxmire
United States Senate
Dear Senator Proxmire:
This is in response to your letter dated May 28, 1985, requesting
that this Office "review the current practice, and legality, of
chauffeur service for top staff of the Office of Management & Budget and
the White House." We have answered the specific questions posed in your
May 28 letter in the discussion of the pertinent circumstances and
applicable law set forth below. In general, we have concluded that no
person at the Office of Management and Budget (OMB) or on the White
House staff may regularly receive Government transportation for travel
between his home and his workplace under the law as it is presently
worded.
The information available to us at this time indicates that at OMB,
the former Director was receiving daily Government home-to-work
transportation until his recent departure from Government service. The
Deputy Director of OMB received such transportation during the first 3
months of this year (until April 5, 1985), but now drives himself to and
from his office. The White House has not responded to our inquiries to
date and we were unable to verify the information provided in your May
28 letter that the Counselor to the President, the Chief of Staff, the
Deputy Chief of Staff, and the Assistant to the President for National
Security Affairs receive Government home-to-work transportation. We
have therefore answered your questions with respect to the White House
staff in general terms, making a working assumption that the information
provided to you 3 years ago is still true for the present incumbents of
the positions you identified.
The provision of home-to-work transportation to Government employees
is governed by 31 U.S.C. Section 1344 (1982) which provides that a
vehicle may be operated with appropriated funds "only for an official
purpose." The term, "official purpose," with few exceptions, "does not
include transporting officers or employees of the Government between
their domiciles and places of employment * * *." 31 U.S.C. Section
1344(a). In our decision in 62 Comp. Gen. 438 (1983), we concluded that
some of our previous decisions interpreting 31 U.S.C. Section 1344
included "overly broad language which implied exceptions to the
statutory prohibition which we did not intend." We then set out to
restate the law as unequivocally as possible. We held that unless
certain narrow exceptions apply, "agencies may not properly exercise
administrative discretion to provide home-to-work transportation to
their officers and employees, unless otherwise provided by statute." 62
Comp. Gen. at 447.
Section 1344(a) of title 31 provides exemptions from the home-to-work
prohibition for medical officers performing outpatient services and
certain employees performing field work. In our opinion, these
exemptions do not apply to OMB and White House staff. Further, section
1344(b) exempts a small group of officials from the home-to-work
prohibition. That group includes the President, the heads of cabinet
departments specifically listed in section 101 of title 5, and
"principal diplomatic and consular officials." 31 U.S.C. Section 1344(b)
(1982). Because no person at OMB or on the White House staff falls
within this group of officials, and we are aware of no other pertinent
authority, we conclude that, in the absence of any information which
would support an exception, no person at OMB or on the White House staff
may properly receive Government home-to-work transportation.
As your May 28 letter indicates, OMB cites section 406 of Public Law
98-371, the Department of Housing and Urban Development-Independent
Agencies Appropriation Act, 1985, in support of its position that
home-to-work transportation for the Director and Deputy Director of OMB
is authorized. That section reads:
"Sec. 406. None of the funds provided in this Act to any
department or agency may be expended for the transportation of any
officer or employee of such department or agency between his
domicile and his place of employment, with the exception of the
Secretary of the Department of Housing and Urban Development, who,
under title 5, United States Code, section 101, is exempted from
such limitation." 98 Stat. 1237.
OMB, in its April 2, 1985, letter to you, points out that section
406, "by expressly preventing the use of appropriated funds to provide
such transportation to all officials other than the Secretary of HUD and
the agencies covered by the bill, demonstrates that Congress knows how
to prohibit such transportation when it wishes to do so."
OMB's argument seems to be that because Congress in section 406
specifically prohibited home-to-work transportation for Department of
Housing and Urban Development employees (with the exception of the
Secretary), and has enacted no similar prohibition for OMB, Congress
intends that there be no home-to-work prohibition applicable to OMB. We
cannot agree with OMB's contention. We are aware of no precedent or
statutory authority which would support such a legal theory. OMB's
position ignores the permanent prohibition of 31 U.S.C. Section 1344.
Were we to accept OMB's argument and apply it to all agencies other than
HUD, it would effectively repeal the home-to-work transportation
prohibition of 31 U.S.C. Section 1344. We are not aware of anything
that shows that Congress intended such a result.
You point out that OMB also asserts "security grounds" as
justification for the provision of home-to-work transportation to the
former Director and the Deputy Director. In 54 Comp. Gen. 855 (1975)
this Office recognized that a legitimate fear of violent criminal or
terrorist activities could warrant an exception to the home-to-work
prohibition for Government employees exposed to such danger. In order
to justify the use of a Government vehicle for home-to-work
transportation on the basis of such a threat, there must be a "clear and
present danger" of violent criminal or terrorist activities directed at
the employee in question and it must be clear that the furnishing of
Government transportation would provide protection not otherwise
available. 54 Comp. Gen. at 858. A determination that a threat to the
safety of an employee justifies home-to-work transportation should be
made with great circumspection. This Office would consider it an abuse
of discretion if speculative or remote fears of terrorism were used to
justify home-to-work transportation of employees. B-210555.3, February
7, 1984.
Here, OMB has merely asserted "security grounds," with no further
explanation, as justification for the home-to-work transportation of the
former Director and the Deputy Director. In our view, this assertion,
standing alone without further explanation of the specific nature of the
threat and the added protection afforded by Government transportation,
does not establish the existence of circumstances warranting Government
home-to-work transportation.
On the other hand, to the extent that security measures are
justified, home-to-work transportation at Government expense may be
authorized.
Your May 28 letter indicates that OMB spokesmen, in statements to the
media, have asserted that the Director's position has "Cabinet-level
rank" and, accordingly, the Director is entitled to Government
home-to-work transportation. OMB apparently contends that the Director
should be numbered among the "heads of executive departments listed in
section 101 of title 5," who are exempt from the home-to-work
prohibition under 31 U.S.C. Section 1344(b). However that may be, under
the law as it presently stands OMB is not a cabinet agency and its
Director is not entitled to rely on the exception. In this connection
you are doubtless aware that the Administration has submitted proposed
legislation on this subject.
Finally, you have specifically asked whether top White House and OMB
staff are subject to the penalties prescribed in law for knowing
violation of the home-to-work prohibition and, if so, how these
penalties would be invoked. The penalty for violation of 31 U.S.C.
Section 1344 is set forth in 31 U.S.C. Section 1349(b) (1982) as
follows:
"(b) An officer or employee who willfully uses or authorizes
the use of a passenger motor vehicle or aircraft owned or leased
by the United States Government (except for an official purpose
authorized by section 1344 of this title) or otherwise violates
section 1344 shall be suspended without pay by the head of the
agency. The officer or employee shall be suspended for at least
one month, and when circumstances warrant, for a longer period or
summarily removed from office."
We are aware of no reason why White House or OMB staff would not be
subject to this provision. The appropriate penalty is mandatory and
would be invoked if a determination by the agency head is made that a
willful violation of section 1344 had taken place. In the case of both
Mr. Stockman and Mr. Wright, as a non-cabinet agency head and his
second-in-command, our 1983 decision established a moratorium on
enforcement of the prohibition against non-cabinet agency heads and the
second-in-command of cabinet and non-cabinet level agencies, until the
end of the 98th Congress in order to afford the executive branch an
opportunity to submit an amendment to the existing prohibition that
might expand the exemptions. That moratorium has now expired. /1/ Mr.
Stockman had continued to use Government transportation until his
departure from Government service and Mr. Wright continued to do so
until April 5, 1985. They did so on advice of counsel that they
qualified for an exemption on several other grounds. The advice was
mistaken in our view, but there may not be grounds for a finding that
Mr. Stockman or Mr. Wright "willfully" disregarded the prohibition.
Similarly, we assume that if White House staff members utilized such
transportation, they did so with advice of counsel. While such
transportation is not permitted by the statute, and we have received no
information regarding any applicable exception to the prohibition, its
use probably would not amount to "willfull" disregard of the law by the
staff members involved.
Nevertheless, irrespective of concerns of willfulness, the fact
remains that on the present record unauthorized use of Government
vehicles for home-to-work transportation did occur. It is our view on
that record, that the officers and employees on the White House staff
who might be involved should immediately cease such use of Government
vehicles unless adequate justification is provided.
We hope that we have been of assistance. Unless we hear otherwise
from your office, this letter will be available for release to the
public 30 days from today.
Sincerely yours,
Comptroller General
of the United States
FOOTNOTES
(1) In a letter to OMB dated February 1, 1985, we offered to delay
our enforcement of the home-to-work restrictions until June 1, 1985, "if
the Administration's proposed legislation is promptly introduced in the
Ninety-Ninth Congress." Since the legislation was not introduced, there
was no extension of our enforcement moratorium beyond the end of the
98th Congress.
B-210555.5, DEC 8, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
STATUTE PROHIBITING, IN THE ABSENCE OF STATUTORY
AUTHORITY, USE OF GOVERNMENT VEHICLES TO PROVIDE
GOVERNMENT OFFICIALS TRANSPORTATION BETWEEN THEIR
HOMES AND WORK SITES DOES NOT APPLY TO OFFICIALS
ON TEMPORARY DUTY. FEDERAL TRAVEL REGULATIONS
SPECIFICALLY AUTHORIZE SUCH TRANSPORTATION WHEN
PUBLIC TRANSPORTATION IS UNAVAILABLE OR IMPRACTICAL. IF
STATE DEPARTMENT CAN MAKE THIS DETERMINATION
IN SUPPORT OF THE USE OF A CAR FOR AMBASSADOR
DONALD RUMSFELD, PERSONAL REPRESENTATIVE OF THE
PRESIDENT TO THE MIDDLE EAST, WHILE ON TEMPORARY
DUTY IN WASHINGTON, D.C., THIS OFFICE WILL NOT
OBJECT.
HOME-TO-WORK TRANSPORTATION FOR AMBASSADOR DONALD RUMSFELD:
THIS IS IN RESPONSE TO A LETTER DATED NOVEMBER 25, 1983, FROM THE
UNDER SECRETARY OF STATE FOR MANAGEMENT, REQUESTING THE OPINION OF THIS
OFFICE AS TO WHETHER AMBASSADOR DONALD RUMSFELD, THE PERSONAL
REPRESENTATIVE OF THE PRESIDENT TO THE MIDDLE EAST, MAY BE TRANSPORTED
IN A GOVERNMENT VEHICLE BETWEEN HIS HOTEL AND VARIOUS WORK SITES,
INCLUDING THE WHITE HOUSE AND THE DEPARTMENT OF STATE, WHILE IN
WASHINGTON, D.C. AS EXPLAINED BELOW, WE CONCLUDE THAT AMBASSADOR
RUMSFELD MAY PROPERLY RECEIVE SUCH TRANSPORTATION WHILE HE IS ENGAGED IN
OFFICIAL BUSINESS IN WASHINGTON.
THE LETTER INDICATES THAT AMBASSADOR RUMSFELD IS SERVING WITHOUT
COMPENSATION, BASED IN CHICAGO, AND DRAWS PER DIEM FOR HIS LIVING
EXPENSES WHILE IN WASHINGTON. IT SPECIFICALLY NOTES THAT AMBASSADOR
RUMSFELD'S DUTIES IN WASHINGTON ENTAIL "UNUSUAL SECURITY RISKS AND
IRREGULAR HOURS."
THE QUESTION WAS RAISED BECAUSE A RECENT DECISION OF OUR OFFICE, 62
COMP.GEN. , B-210555, JUNE 3, 1983, REAFFIRMED OUR POSITION THAT,
EXCEPT FOR CERTAIN STATUTORY EXCEPTIONS AND A FEW NARROWLY LIMITED
CIRCUMSTANCES, "AGENCIES MAY NOT PROPERLY PROVIDE HOME-TO-WORK
TRANSPORTATION FOR THEIR OFFICERS AND EMPLOYEES, UNLESS OTHERWISE
PROVIDED BY STATUTE." SEE 31 U.S.C. SEC. 1344. HOWEVER, IN THE INSTANT
CASE, THAT DECISION IS NOT APPLICABLE. AMBASSADOR RUMSFELD'S
GOVERNMENT-PROVIDED LODGING IN WASHINGTON IS NOT HIS HOME. THE STATUTE
PROHIBITING TRANSPORTATION OF GOVERNMENT OFFICIALS IN A GOVERNMENT
VEHICLE BETWEEN HOME AND WORK USES THE TERM "HOME" IN THE SENSE OF A
RESIDENCE OCCUPIED WHILE THE EMPLOYEE IS COMMUTING TO HIS HOME BASE OR
HEADQUARTERS.
FURTHER, THE FEDERAL TRAVEL REGULATIONS SPECIFICALLY PERMIT THE USE
OF GOVERNMENT-FURNISHED VEHICLES TO TRANSPORT GOVERNMENT EMPLOYEES ON
TEMPORARY DUTY BETWEEN THEIR LODGINGS AND WORK SITES. SEE GENERALLY
FEDERAL TRAVEL REGULATIONS, FPMR 101-7 (NOVEMBER 1, 1981) (FTR) CHAPTER
1. PARAGRAPH 1-2.6 OF THE FTR PERMITS SUCH USE OF GOVERNMENT VEHICLES
"WHEN PUBLIC TRANSPORTATION IS UNAVAILABLE OR ITS USE IS IMPRACTICAL."
FTR PARAGRAPH 1-2.2(B) PROVIDES THAT THE METHOD OF TRANSPORTATION
SELECTED FOR OFFICIAL TRAVEL SHALL BE THAT METHOD "WHICH WILL RESULT IN
THE GREATEST ADVANTAGE TO THE GOVERNMENT, COST AND OTHER FACTORS
CONSIDERED." THIS IS IN ACCORD WITH 5 U.S.C. SEC. 5733 (1976) WHICH
PROVIDES, "THE TRAVEL OF AN EMPLOYEE SHALL BE BY THE MOST EXPEDITIOUS
MEANS OF TRANSPORTATION PRACTICABLE AND SHALL BE COMMENSURATE WITH THE
NATURE AND PURPOSE OF THE DUTIES OF THE EMPLOYEE REQUIRING SUCH TRAVEL."
IN THE CASE OF AMBASSADOR RUMSFELD, IF THE DEPARTMENT OF STATE CAN
SUPPORT AN ADMINISTRATIVE DETERMINATION THAT THE TRANSPORTATION OF
AMBASSADOR RUMSFELD IN OTHER THAN A GOVERNMENT-FURNISHED VEHICLE WOULD
BE "IMPRACTICAL" IN VIEW OF "THE UNUSUAL SECURITY RISKS AND IRREGULAR
HOURS HIS DUTIES ENTAIL," AND THAT A GOVERNMENT-FURNISHED VEHICLE IS THE
METHOD OF TRANSPORTATION MOST "COMMENSURATE WITH THE NATURE AND PURPOSE
OF THE DUTIES" OF THE PERSONAL REPRESENTATIVE OF THE PRESIDENT TO THE
MIDDLE EAST, THIS OFFICE WOULD HAVE NO REASON TO OBJECT.
B-210555.4, FEB 2, 1984, OFFICE OF GENERAL COUNSEL
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
K.E. MALMBORG, ESQ., OFFICE OF THE LEGAL ADVISOR, U.S. DEPARTMENT OF
STATE:
THIS IN RESPONSE TO YOUR LETTER DATED JULY 26, 1983, TO HENRY BARCLAY
OF THIS OFFICE ASKING WHETHER THE PRINCIPAL DEPUTY REPRESENTATIVE OF THE
UNITED STATES TO THE UNITED NATIONS MAY BE AUTHORIZED USE OF AN OFFICIAL
VEHICLE FOR TRAVEL BETWEEN HIS HOME AND HIS OFFICE. FOR THE REASONS SET
FORTH IN A DEFINITIVE COMPTROLLER GENERAL DECISION ON THIS TOPIC ISSUED
JUNE 3, 1983 (62 COMP.GEN. 438, COPY ENCLOSED), WE CONCLUDE THAT THE
PRINCIPAL DEPUTY REPRESENTATIVE TO THE UNITED NATIONS MAY NOT BE
TRANSPORTED BETWEEN HIS HOME AND OFFICE IN A GOVERNMENT VEHICLE, BASED
ON 31 U.S.C. SEC. 1344(A), WHICH NARROWLY RESTRICTS SUCH USE OF
GOVERNMENT VEHICLES.
A VEHICLE MAY BE OPERATED WITH APPROPRIATED FUNDS "ONLY FOR AN
OFFICIAL PURPOSE," AND THE TERM, "OFFICIAL PURPOSE," WITH FEW
EXCEPTIONS, "DOES NOT INCLUDE TRANSPORTING OFFICERS OR EMPLOYEES OF THE
GOVERNMENT BETWEEN THEIR DOMICILES AND PLACES OF EMPLOYMENT ***." 31 U.
S.C. SEC. 1344(A). IN 62 COMP.GEN. 438, SUPRA, WE INTERPRETED THE
STATUTE TO MEAN THAT, EXCEPT IN CERTAIN NARROWLY LIMITED CIRCUMSTANCES,
"AGENCIES MAY NOT PROPERLY PROVIDE HOME-TO-WORK TRANSPORTATION FOR THEIR
OFFICERS AND EMPLOYEES, UNLESS OTHERWISE PROVIDED BY STATUTE."
YOU ARE OBVIOUSLY AWARE OF THIS PRECEPT BUT YOU CITE THREE STATUTES
WHICH YOU THINK MAY FORM THE BASIS FOR AN EXCEPTION TO THE GENERAL
PROHIBITION ON THE USE OF GOVERNMENT VEHICLES FOR HOME-TO-WORK
TRANSPORTATION. THE FIRST IS 31 U.S.C. SEC. 1344(B)(3), WHICH PROVIDES
THAT THE GENERAL PROHIBITION IN SECTION 1344(A) DOES NOT APPLY TO THE
TRANSPORT OF CERTAIN INDIVIDUALS, INCLUDING "PRINCIPAL DIPLOMATIC AND
CONSULAR OFFICIALS."
THE COMPTROLLER GENERAL DEALT WITH A SIMILAR CONTENTION BY YOUR
OFFICE IN 62 COMP.GEN. 438, SUPRA, AT P. 444-45. IT WAS SUGGESTED AT
THAT TIME THAT THE PHRASE "PRINCIPAL DIPLOMATIC AND CONSULAR OFFICIALS"
IN 31 U.S.C. SEC. 1344(B)(3) INCLUDES "THOSE PRINCIPAL OFFICERS OF THE
GOVERNMENT WHOSE DUTIES REQUIRE FREQUENT OFFICIAL CONTACT UPON A
DIPLOMATIC LEVEL WITH RANKING OFFICERS AND REPRESENTATIVES OF FOREIGN
GOVERNMENTS."
WE REBUTTED THAT CONTENTION AT SOME LENGTH IN THE AFOREMENTIONED
DECISION. IN BRIEF SUMMARY, WE REFERRED TO THE DEFINITION OF "PRINCIPAL
OFFICER" IN 22 U.S.C. SEC. 3902 ("PRINCIPAL OFFICER" MEANS "THE OFFICER
IN CHARGE OF A DIPLOMATIC MISSION, CONSULAR MISSION *** OR OTHER FOREIGN
SERVICE POST") AND SIMILAR DEFINITIONS IN THE STATE DEPARTMENT'S FOREIGN
AFFAIRS MANUAL. SEE 2 F.A.M. 041(I), 043, OCTOBER 11, 1977 (PRINCIPAL
OFFICERS ARE AMBASSADORS, MINISTERS, CHARGES D'AFFAIRES, AND OTHER
SIMILAR OFFICERS WHO ARE IN CHARGE OF FOREIGN SERVICE POSTS; EACH SUCH
PERSON IS THE 'PRINCIPAL DIPLOMATIC REPRESENTATIVE OF THE UNITED STATES
*** TO THE GOVERNMENT TO WHICH HE IS ACCREDITED'.")
WE ALSO QUOTED THE LANGUAGE OF 31 U.S.C. SEC. 1344(B)(3) AS
ORIGINALLY ENACTED ("AMBASSADORS, MINISTERS, CHARGES D'AFFAIRES, AND
OTHER PRINCIPAL DIPLOMATIC AND CONSULAR OFFICIALS"), AND DISCUSSED THE
LEGISLATIVE HISTORY. WE CONCLUDED THAT THE EXCEPTION FOR "PRINCIPAL
DIPLOMATIC AND CONSULAR OFFICIALS" APPLIES ONLY TO "INDIVIDUALS WHO ARE
PROPERLY DESIGNATED (OR SUCCEED) TO HEAD A FOREIGN DIPLOMATIC, CONSULAR,
OR OTHER SIMILAR FOREIGN SERVICE POST."
SINCE THAT DECISION WAS ISSUED, IT WAS POINTED OUT TO US INFORMALLY
BY THE STATE DEPARTMENT THAT THE UNITED STATES AMBASSADOR TO THE UNITED
NATIONS IS THE FULL EQUIVALENT OF AN AMBASSADOR TO A FOREIGN NATION.
WHILE WE HAVE NOT RULED FORMALLY ON HER ENTITLEMENT, WE THINK THAT SHE
IS AUTHORIZED TO BE TRANSPORTED BETWEEN HER HOME AND OFFICE AS A
"PRINCIPAL DIPLOMATIC AND CONSULAR OFFICIAL." SEE 22 U.S.C. SEC. 287(A)
(1982). HOWEVER, THE PRINCIPAL DEPUTY REPRESENTATIVE IS NOT THE "HEAD
OF MISSION" AND IS THEREFORE NOT AUTHORIZED HOME-TO-WORK TRANSPORTATION
IN GOVERNMENT VEHICLES, ANY MORE THAN IS THE SECOND-IN-COMMAND OF
CABINET-RANK DEPARTMENTS WHOSE SECRETARIES ARE ALSO GRANTED AN
EXEMPTION.
THE SECOND STATUTE YOU SUGGEST AS PROVIDING AN EXCEPTION FOR THE
PRINCIPAL DEPUTY REPRESENTATIVE IS 22 U.S.C. SEC. 2678 (1982) WHICH
READS:
"NOTWITHSTANDING THE PROVISIONS OF SECTIONS
1343(C), 1344 AND 1349(B) OF TITLE 31, THE
SECRETARY OF STATE MAY AUTHORIZE ANY CHIEF OF
DIPLOMATIC MISSION TO APPROVE THE USE OF
GOVERNMENT-OWNED VEHICLES OR TAXICABS IN ANY
FOREIGN COUNTRY FOR TRANSPORTATION OF UNITED
STATES GOVERNMENT EMPLOYEES FROM THEIR RESIDENCE
TO THE OFFICE AND RETURN WHEN PUBLIC
TRANSPORTATION FACILITIES OTHER THAN TAXICABS
ARE UNSAFE OR NOT AVAILABLE."
THIS STATUTE, ON ITS FACE, IS NOT APPLICABLE. IT CLEARLY APPLIES
ONLY TO DIPLOMATIC MISSIONS "IN ANY FOREIGN COUNTRY." FURTHER, IT
APPLIES ONLY "WHEN PUBLIC TRANSPORTATION FACILITIES OTHER THAN TAXICABS
ARE UNSAFE OR NOT AVAILABLE." THERE IS NO INDICATION IN YOUR LETTER THAT
THOSE CONDITIONS EXIST IN THE CITY OF NEW YORK. ACCORDINGLY, WE
CONCLUDE THAT 22 U.S.C. SEC. 2678 DOES NOT PROVIDE AN EXCEPTION IN THIS
CASE TO THE GENERAL PROHIBITION ON THE USE OF GOVERNMENT VEHICLES FOR
HOME-TO-WORK TRANSPORTATION.
THE FINAL STATUTE YOU OFFER IS 22 U.S.C. SEC. 2700 (1982) WHICH
READS:
"THE SECRETARY OF STATE MAY AUTHORIZE THE
PRINCIPAL OFFICER OF A FOREIGN SERVICE POST TO
PROVIDE FOR THE USE OF GOVERNMENT OWNED OR
LEASED VEHICLES LOCATED AT THAT POST FOR TRANSPORTATION
OF UNITED STATES GOVERNMENT EMPLOYEES
AND THEIR FAMILIES WHEN PUBLIC TRANSPORTATION
IS UNSAFE OR NOT AVAILABLE OR WHEN SUCH USE IS
ADVANTAGEOUS TO THE GOVERNMENT."
AS INDICATED ABOVE, THERE IS NO EVIDENCE THAT PUBLIC TRANSPORTATION IN
NEW YORK CITY IS "UNSAFE OR NOT AVAILABLE." FURTHER, IT DOES NOT APPEAR
FROM THE FACTS YOU SUBMITTED TO US THAT PROVIDING HOME-TO-WORK
TRANSPORTATION FOR THE PRINCIPAL DEPUTY REPRESENTATIVE TO THE UNITED
NATIONS COULD REASONABLY BE DEEMED "ADVANTAGEOUS TO THE GOVERNMENT" IN
THE SENSE INTENDED BY CONGRESS. THE SENATE COMMITTEE REPORT ON THE
FOREIGN SERVICE ACT OF 1980, WHICH ADDED THE STATUTE CODIFIED AT 22 U.
S.C. SEC. 2700 TO THE STATE DEPARTMENT'S BASIC AUTHORITIES ACT OF 1956,
70 STAT. 890, INCLUDED THE FOLLOWING EXPLANATION:
"SECTION 914 OF THE FOREIGN SERVICE ACT OF
1946 PROVIDES THAT THE SECRETARY OF STATE MAY
AUTHORIZE A PRINCIPAL OFFICER TO APPROVE THE
USE OF GOVERNMENT-OWNED OR LEASED VEHICLES FOR
TRANSPORTATION AT POST WHEN PUBLIC TRANSPORTATION
IS UNSAFE OR UNAVAILABLE. NEW SECTION 28
CONTAINS THE SAME AUTHORITY AND IS INTENDED TO
CONTINUE THE EXISTING EXCEPTION TO 31
U.S.C. SEC. 638A. THE SECTION ALSO PERMITS SUCH USE
WHEN IT IS ADVANTAGEOUS TO THE GOVERNMENT. THE
APPROVAL COULD EXTEND TO ALL AGENCIES UNDER THE
AUTHORITY OF THE CHIEF OF MISSION OR ONLY TO
CERTAIN AGENCIES OPERATING UNDER SPECIAL CONDITIONS
(FOR EXAMPLE, A COMMUNICATIONS FACILITY
LOCATED OUTSIDE THE FOREIGN CAPITAL IN A HAZARDOUS
AREA). 'ADVANTAGE' TO THE GOVERNMENT
INCLUDES, FOR EXAMPLE, SITUATIONS WHERE IT IS
LESS COSTLY TO PROVIDE TRANSPORTATION THAN TO
PAY THE COST OF SHIPPING PRIVATELY OWNED
VEHICLES, WHERE SOME U.S. CITIZEN EMPLOYEES OR
MEMBERS OF THEIR FAMILIES ARE NOT PERMITTED TO
DRIVE BY LOCAL LAW OR CUSTOM, OR WHERE SOME ARE
NOT PERMITTED TO IMPORT A PRIVATELY OWNED
VEHICLE BY THE LOCAL GOVERNMENT OR ARE EFFECTIVELY
PREVENTED FROM DOING SO BY REASON OF
IMPORT DUTIES IN EXCESS OF THE PURCHASE VALUE
OF THE PRIVATELY OWNED VEHICLE. IT IS EXPECTED
THAT WHEN THE GOVERNMENT ELECTS TO PROVIDE
TRANSPORTATION TO EMPLOYEES, REGULATIONS WILL
PROHIBIT THE EMPLOYEES CONCERNED FROM IMPORTING
VEHICLES AT GOVERNMENT EXPENSE."
S.REP.NO. 96-913, 96TH CONG., 2D SESS. 98-99 (1980).
IT IS EVIDENT FROM THIS LEGISLATIVE MATERIAL THAT CONGRESS, IN
ENACTING 22 U.S.C. SEC. 2700, ENVISIONED ITS APPLICABILITY IN FOREIGN
AREAS. ADDITIONALLY, IT IS CLEAR THAT CONGRESS INTENDED THAT THE
"ADVANTAGE" GAINED BY THE USE OF GOVERNMENT TRANSPORTATION WOULD BE
FINANCIAL ADVANTAGE TO THE GOVERNMENT OR INCREASED EFFICIENCY UNDER
UNUSUAL OVERSEAS CONDITIONS, RATHER THAN CONVENIENCE TO THE OFFICIAL
PASSENGER. THERE IS NO INDICATION IN THE RECORD THAT THE GOVERNMENT
WOULD REALIZE A FINANCIAL ADVANTAGE OR INCREASED OVERSEAS EFFICIENCY BY
PROVIDING THE PRINCIPAL DEPUTY REPRESENTATIVE WITH HOME-TO-WORK
TRANSPORTATION.
ACCORDINGLY, WE MUST ADVISE YOU THAT THE PRINCIPAL DEPUTY
REPRESENTATIVE TO THE UNITED NATIONS MAY NOT BE TRANSPORTED BETWEEN HIS
HOME AND OFFICE IN A GOVERNMENT VEHICLE, BECAUSE SUCH USE OF GOVERNMENT
VEHICLES IS GENERALLY PROHIBITED BY 31 U.S.C. SEC. 1344(A), AND THERE IS
NO STATUTE APPLICABLE IN THE INSTANT CASE WHICH WOULD FORM THE BASIS OF
AN EXCEPTION TO THAT GENERAL PROHIBITION. WE NOTE THAT OUR DECISION IN
62 COMP.GEN. 438, SUPRA, STATES SPECIFICALLY THAT IT HAS PROSPECTIVE
APPLICATION ONLY. WE DO NOT REQUIRE AGENCIES TO RECOVER EXPENSES OF
HOME-TO-WORK TRANSPORTATION PROVIDED TO OFFICIALS PRIOR TO JUNE 3, 1983,
THE DATE OF THAT DECISION. WE ALSO STATED THAT WITH RESPECT TO AGENCY
HEADS AND THEIR PRINCIPAL DEPUTIES, WE WILL NOT REQUIRE RECOVERY ACTION
UNTIL THE END OF THE PRESENT CONGRESS, IN ORDER TO ALLOW THE CONGRESS
SUFFICIENT TIME TO CONSIDER VARIOUS LEGISLATIVE RECOMMENDATIONS MADE BY
THE GAO AND OTHERS TO EXPAND THE SCOPE OF THE EXEMPTIONS. WE WOULD
EXTEND THIS SAME COURTESY TO THE PRINCIPAL DEPUTY OF THE AMBASSADOR TO
THE UNITED NATIONS. AT THE SAME TIME, WE URGE YOU TO SUBMIT ANY SPECIAL
NEEDS YOU MAY HAVE FOR HOME-TO-WORK TRANSPORTATION WHICH IS NOT NOW
PERMISSIBLE TO THE OFFICE OF MANAGEMENT AND BUDGET. WE UNDERSTAND THAT
THE OMB HAS BEEN GIVEN THE RESPONSIBILITY TO SURVEY THE NEEDS OF THE
EXECUTIVE BRANCH FOR SUCH TRANSPORTATION AND TO SUBMIT PROPOSED
AMENDMENTS TO 31 U.S.C. SEC. 1344(A), IF DEEMED APPROPRIATE, TO THE
CONGRESS BEFORE THE END OF ITS SECOND SESSION.
B-210555.3, FEB 7, 1984, OFFICE OF GENERAL COUNSEL
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
JOSEPH A. MORRIS, ESQ. GENERAL COUNSEL OFFICE OF PERSONNEL
MANAGEMENT:
MR. BOWSHER HAS ASKED ME TO REPLY TO YOUR LETTER OF JULY 26, 1983,
CONCERNING OUR DECISION B-210555, 62 COMP.GEN. 438, JUNE 3, 1983, WHICH
STATES THE DEFINITIVE RULES FOR USE OF GOVERNMENT VEHICLES FOR
TRANSPORTATION OF ALL AGENCY OFFICIALS BETWEEN HOME AND WORK. I AM
HAPPY TO HAVE THIS OPPORTUNITY TO ASSIST YOU IN UPDATING YOUR AUGUST 28,
1981 ADVICE TO DIRECTOR DONALD J. DEVINE.
TO AVOID ANY POSSIBLE MISUNDERSTANDING, I SHOULD MENTION AT THE
OUTSET THAT THE JUNE 3 DECISION DID NOT STATE THAT ITS PRECEPTS WOULD
NOT BE EFFECTIVE, ACROSS THE BOARD, UNTIL THE END OF THE CURRENT
CONGRESS. BY STATING THAT THE DECISION WOULD BE CONSIDERED TO BE
"PROSPECTIVE ONLY," WE MEANT THAT WE DID NOT FEEL COMPELLED TO SEEK
RECOVERY FROM ALL OFFICIALS THROUGHOUT THE GOVERNMENT WHO HAD BEEN
UTILIZING GOVERNMENT TRANSPORTATION IMPROPERLY PRIOR TO THE DATE OF OUR
JUNE 3 DECISION.
WITH RESPECT TO THE FURNISHING OF SUCH TRANSPORTATION AFTER THE DATE
OF OUR DECISION, THERE IS NO SUCH MORATORIUM. WE SINGLED OUT ONLY 2
CLASSES OF GOVERNMENT OFFICIALS FOR A TEMPORARY POSTPONEMENT OF ANY
ENFORCEMENT ACTION WE MIGHT OTHERWISE BE COMPELLED TO TAKE - HEADS OF
NON-CABINET AGENCIES (WHICH, OF COURSE, INCLUDES MR. DEVINE), AND THE
SECOND IN COMMAND TO HEADS OF BOTH CABINET AND NON-CABINET AGENCIES.
WITHOUT A CHANGE IN THE LAW OR THE TEMPORARY SUSPENSION OF ENFORCEMENT
ACTION, THERE WOULD BE NO AUTHORITY WHATSOEVER FOR MR. DEVINE OR ANYONE
ELSE AT OPM TO RECEIVE HOME-TO-WORK TRANSPORTATION AT GOVERNMENT
EXPENSE, NO MATTER HOW COMPELLING THE CIRCUMSTANCES. GAO HAS LONG
ADVOCATED A LEGISLATIVE CHANGE WHICH WOULD ELIMINATE THE DISTINCTION
BETWEEN HEADS OF CABINET AGENCIES AND NON-CABINET AGENCIES AND WHICH
WOULD ADD THE RESPECTIVE NUMBER 2 OFFICIAL IN EACH AGENCY TO THE
STATUTORY LIST OF OFFICIALS EXEMPT FROM THE PROHIBITION AGAINST
HOME-TO-WORK TRANSPORTATION.
NOW LET ME DEAL WITH THE MERITS OF YOUR 1981 ADVICE TO MR. DEVINE.
UNDERSTANDABLY, YOU HAVE INTERSPERSED PERFECTLY VALID GENERAL STATEMENTS
WITH OTHER STATEMENTS THAT SUGGEST A DEGREE OF DISCRETION WHICH THE LAW
ITSELF DOES NOT AFFORD. YOU HAVE USED TO SUPPORT YOUR THESIS A NUMBER
OF COMPTROLLER GENERAL DECISIONS. FOR A CONTEMPORARY DISCUSSION OF
THESE OLD CASES (PARTICULARLY, 25 COMP.GEN. 844 (1946) AND 54 COMP.GEN.
855 (1975), BOTH OF WHICH YOU CITE IN SUPPORT OF YOUR ADVICE), SEE P. 10
OF OUR JUNE 3, 1983 DECISION. IT WAS PRECISELY BECAUSE OF THE CONFUSION
GENERATED BY THESE OLD DECISIONS THAT WE WERE ASKED BY CONGRESSMAN
BROOKS TO WRITE A DEFINITIVE EXPOSITION OF THE GOVERNMENT AUTOMOBILES
PROHIBITION.
YOUR SUMMARY OF THE RULES STATES:
1. "NO OPM OFFICIAL SHOULD BE DRIVEN TO OR FROM HOME ROUTINELY."
I AGREE, BUT DO NOT LIMIT THE PROHIBITION TO "ROUTINE" TRAVEL.
UNLESS THE USE OF A GOVERNMENT CAR FITS UNDER ANOTHER STATUTE, SUCH AS
THE TRAVEL LAW AND ITS IMPLEMENTING REGULATIONS, SUCH TRANSPORTATION IS
ABSOLUTELY FORBIDDEN.
THE FIRST OF YOUR THREE EXCEPTIONS TO THE PROHIBITION IS INCORRECT.
YOU ASSUME THAT AN OPM OFFICIAL, ENTITLED TO BE DRIVEN FROM HIS
HEADQUARTERS TO A PARTICULAR SITE OR OFFICE, COULD BE PICKED UP AT HOME,
BYPASS HIS NORMAL HEADQUARTERS STOP, AND BE DEPOSITED DIRECTLY AT THE
SITE OR OFFICE WHERE HIS ACTIVITY IS TO COMMENCE. I MUST REMIND YOU
THAT EVERY EMPLOYEE IS RESPONSIBLE FOR HIS OR HER OWN TRANSPORTATION TO
THE HEADQUARTERS STATION OR TO THE SITE OR OFFICE WHERE THE EMPLOYEE'S
WORK IS TO BEGIN. IF THE EMPLOYEE WISHES TO PICK UP GOVERNMENT
TRANSPORTATION, HE OR SHE SHOULD DO SO AT HIS OR HER USUAL HEADQUARTERS
SITE. UNDER NO CIRCUMSTANCES CAN THE EMPLOYEE JUSTIFY A CHAUFFEUR
DRIVEN RIDE TO WORK FROM HIS OR HER HOME ON THE GROUND THAT THE EMPLOYEE
WOULD ONLY BE TRANSFERRING FROM ONE CAR TO ANOTHER.
THE LAST TWO EXCEPTIONS DO NOT PRESENT ANY PROBLEMS. IT IS ASSUMED
THAT THE EMPLOYEE IS ON OUT-OF-TOWN TRAVEL STATUS. WHATEVER SERVICES OR
REIMBURSEMENTS ARE AUTHORIZED UNDER THE EMPLOYEE'S TRAVEL ORDERS ARE
PERMISSIBLE, CONSISTENT WITH THE GENERAL SERVICES ADMINISTRATION'S
FEDERAL TRAVEL REGULATIONS (FTR), EVEN IF A SIMILAR SERVICE OR
REIMBURSEMENT WOULD BE DISALLOWED IF THE EMPLOYEE WAS NOT IN TRAVEL
STATUS.
2. "AN OPM OFFICIAL MAY BE DRIVEN BETWEEN HEADQUARTERS AND ANY OTHER
PLACE WHERE OFFICIAL BUSINESS IS TO BE TRANSACTED. ... NO OPM OFFICIAL
SHOULD BE DRIVEN ON ANY OCCASION FOR PURELY PRIVATE PURPOSES."
THESE STATEMENTS ARE PERFECTLY PROPER. THEY ARE, HOWEVER, OUTSIDE
THE PARAMETERS OF OUR JUNE 3 DECISION WHICH DEALT ONLY WITH THE
STATUTORY PROHIBITION ON THE USE OF A GOVERNMENT VEHICLE BETWEEN AN
OFFICIAL'S DOMICILE AND WORK PLACE.
3. "YOU SHOULD ALSO BE AWARE THAT THE COMPTROLLER GENERAL HAS
APPROVED THE TRANSPORT OF THE DEPENDENTS OF A GOVERNMENT OFFICIAL IN HIS
COMPANY WHEN HE IS HIMSELF PROPERLY BEING TRANSPORTED ON OFFICIAL
BUSINESS."
THIS STATEMENT, AS IT APPEARS ABOVE, IS CORRECT. HOWEVER, WE WOULD
DISAGREE THAT IF MR. DEVINE WERE INVITED TO AN OFFICIAL FUNCTION TO
WHICH SPOUSES WERE ALSO INVITED, "IT WOULD BE APPROPRIATE FOR MRS.
DEVINE TO BE PICKED UP AND TO BE DRIVEN WITH YOU."
THE ONLY ADVICE ALONG THESE LINES THAT YOU CAN ACCURATELY OFFER MR.
DEVINE IS THAT HE AND HIS WIFE MAY BOTH BE TRANSPORTED TOGETHER TO THE
OFFICIAL FUNCTION IF THEY LEAVE FROM THE OFFICE. THERE ARE NO
CIRCUMSTANCES OF WHICH WE CAN CONCEIVE THAT WOULD JUSTIFY PICKING UP
MRS. DEVINE AT HOME IN ORDER FOR HER TO BE DRIVEN TO THE FUNCTION WITH
MR. DEVINE.
4. "AN EXCEPTION TO THE PROHIBITION ON THE USE OF AN OFFICIAL CAR
AND DRIVER FOR PURELY PERSONAL TRAVEL MAY BE MADE IN CIRCUMSTANCES WHEN
NECESSARY TO PROTECT THE LIFE AND SAFETY OF THE GOVERNMENT OFFICIAL
INVOLVED."
OUR DECISION IN 54 COMP.GEN. 855 (1975) WAS LIMITED TO THE USE OF
GOVERNMENT VEHICLES FOR HOME-TO-WORK TRANSPORTATION WHEN TERRORIST ACTS
WERE FEARED. IT DID NOT CONSIDER THE USE OF PERSONAL VEHICLES FOR
PURELY PERSONAL TRAVEL UNRELATED TO TRAVELING TO OR FROM ANY EMPLOYEE'S
WORKPLACE. UNDER THE TERMS OF THE STATUTORY PROHIBITION, IT WOULD BE
DIFFICULT TO CONCLUDE THAT "PURELY PERSONAL TRAVEL" COULD BE FOR AN
"OFFICIAL PURPOSE" AS REQUIRED BY THE STATUTE. IN ANY EVENT, NO PRIOR
COMPTROLLER GENERAL DECISION HAS EVER SO CONCLUDED.
OUR JUNE 3 DECISION DID, HOWEVER, RECOGNIZE LEGITIMATE FEAR OF
TERRORIST ACTIVITIES AS A PERMISSIBLE EXCEPTION TO THE HOME-TO-WORK
PROHIBITION FOR AGENCY HEADS OR FOR ANY OTHER EMPLOYEES EXPOSED TO SUCH
DANGER, UNDER THE RATIONALE SET OUT IN 54 COMP.GEN. 855.
WE NOTE, IN THIS CONNECTION THAT 54 COMP.GEN. 855 SPECIFIED THAT A
"CLEAR AND PRESENT DANGER" OF TERRORIST ACTIVITIES MUST BE FOUND TO
EXIST IN ORDER TO WARRANT USE OF GOVERNMENT VEHICLES FOR HOME-TO-WORK
TRAVEL. THE DECISION ALSO CAUTIONED AGAINST "SPECULATIVE AND REMOTE"
FEARS OF TERRORISM, WHICH IT STATED WOULD AMOUNT TO AN ABUSE OF
DISCRETION IF USED TO JUSTIFY HOME-TO-WORK TRANSPORTATION OF EMPLOYEES.
WE ALSO SUGGESTED THAT "SPECIFIC LEGISLATIVE AUTHORITY FOR SUCH USE OF
VEHICLES SHOULD BE SOUGHT AT THE EARLIEST POSSIBLE TIME. ..."
OF COURSE, THE HOME-TO-WORK PROBLEM WOULD NOT ARISE IN PHILADELPHIA,
WHERE THE PRIMARY DANGER TO MR. DEVINE IS LOCATED ACCORDING TO YOUR
MEMORANDUM. MR. DEVINE PRESUMABLY IS BASED IN THE WASHINGTON AREA AND
WOULD THEREFORE BE ON TRAVEL STATUS IN PHILADELPHIA. SHOULD THERE
WASHINGTON, D.C. AREA, THEN HOME-TO-WORK TRANSPORTATION MIGHT BE ARISE A
CLEAR AND PRESENT DANGER TO MR. DEVINE'S LIFE OR SAFETY IN THE
WARRANTED; HOWEVER, THIS TRANSPORTATION COULD BE PROVIDED ONLY UPON A
SHOWING THAT "THE FURNISHING OF GOVERNMENT TRANSPORTATION WILL PROVIDE
PROTECTION NOT OTHERWISE AVAILABLE." 54 COMP.GEN. AT 858.
WE WOULD SUGGEST THAT ANY SPECIAL CIRCUMSTANCE WHICH WOULD, IN YOUR
VIEW, WARRANT HOME-TO-WORK TRANSPORTATION FOR THE OPM DIRECTOR OR FOR
OTHER OPM EMPLOYEES BE COMMUNICATED TO THE OFFICE OF MANAGEMENT AND
BUDGET TO ASSIST THAT OFFICE IN PREPARING A PROPOSED AMENDMENT TO THE
HOME-TO-WORK PROHIBITION IN 31 U.S.C. SEC. 1344.
B-210555.2, SEP 1, 1983
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
THE HONORABLE JEROME W. VAN GORKOM, UNDER SECRETARY OF STATE FOR
MANAGEMENT DEPARTMENT OF STATE:
YOUR LETTER OF JULY 6, 1983, ENCLOSED A DESCRIPTION OF THE DUTIES OF
THE CHIEF OF PROTOCOL, SELWA ROOSEVELT, AND COMMENTED UPON THE
DIFFICULTIES SHE WOULD ENCOUNTER IN COMPLYING WITH OUR JUNE 3, 1983
DECISION CONCERNING THE USE OF GOVERNMENT VEHICLES AND CHAUFFEURS FOR
HOME-TO-WORK TRANSPORTATION.
AS YOU KNOW, OUR DECISION CONCLUDED THAT USE OF GOVERNMENT VEHICLES
FOR HOME-TO-WORK TRANSPORTATION WAS LIMITED BY THE PROVISIONS OF SEC.
1344 OF TITLE 31, U.S.C., TO THE PRESIDENT, CABINET LEVEL OFFICERS,
PRINCIPAL DIPLOMATIC AND CONSULAR OFFICIALS, MEDICAL OFFICERS ON
OUTPATIENT MEDICAL SERVICES, AND CERTAIN EMPLOYEES ENGAGED IN "FIELD
WORK". THE DECISION CONCLUDED SPECIFICALLY THAT "SEVENTH FLOOR
PRINCIPALS" OF THE STATE DEPARTMENT ARE NOT PRINCIPAL DIPLOMATIC OR
CONSULAR OFFICIALS ENTITLED TO HOME-TO-WORK TRANSPORTATION UNDER THE
LAW.
AT THE SAME TIME, IN A LETTER TRANSMITTING OUR DECISION TO THE
HONORABLE JACK BROOKS, WE RECOGNIZED THAT GOVERNMENT OFFICIALS, SUCH AS
THE HEADS OF MAJOR NON-CABINET LEVEL AGENCIES AND "PRINCIPAL OFFICIALS"
(I.E. PERSONS OCCUPYING THE NUMBER TWO POSITION IN AN AGENCY) MIGHT WELL
HAVE THE SAME NEED FOR HOME-TO-WORK TRANSPORTATION AS THOSE AUTHORIZED
BY THE LAW. WE ALSO NOTED THAT THERE ARE NO PROVISIONS FOR HANDICAPPED
PERSONNEL, OR FOR TRANSPORTATION TO AND FROM EVENING MEETINGS WHERE
ALTERNATIVE TRANSPORTATION IS NOT AVAILABLE OR, GENERALLY, WHERE THERE
IS NO OTHER WAY TO ACCOMPLISH OFFICIAL BUSINESS WITHOUT THE USE OF
CHAUFFEUR-DRIVEN AUTOMOBILES.
FINALLY, IN VIEW OF EXISTING CONFUSION REGARDING APPLICATION OF THE
HOME-TO-WORK RESTRICTION AND OF PAST GAO RECOMMENDATIONS FOR LEGISLATIVE
CHANGE, WE STATED THAT OUR DECISION NEED NOT BE CONSIDERED EFFECTIVE
WITH RESPECT TO AGENCY HEADS AND THEIR PRINCIPAL DEPUTIES UNTIL THE END
OF THE PRESENT CONGRESS, IN ORDER TO ALLOW THE CONGRESS TIME TO CONSIDER
AND CLARIFY OVERALL POLICY.
THE ENCLOSURES TO YOUR LETTER POINT OUT THAT THE CHIEF OF PROTOCOL
HAS THE SAME DIPLOMATIC STATUS AS OUR AMBASSADORS OVERSEAS. EXAMPLES
WERE PROVIDED OF THE FREQUENCY WITH WHICH THE CHIEF OF PROTOCOL IS
REQUIRED TO ATTEND OFFICIAL EVENING FUNCTIONS WHICH CAN LAST AS LATE AS
1:00 A.M., TO ATTEND EARLY MORNING MEETINGS AT NON-OFFICE LOCATIONS, AND
TO BE PRESENT FOR EARLY MORNING ARRIVALS OR DEPARTURES FROM ANDREWS AIR
FORCE BASE. YOU NOTE THE DIFFICULTIES ATTENDANT TO USING PRIVATE
TRANSPORTATION OR TAXICABS IN SUCH SITUATIONS; YOU POINT OUT THAT "FOR
DAILY LATE NIGHT AND EARLY MORNING TRIPS, IT WOULD COST NO MORE TO
PROVIDE HOME TRANSPORTATION FOR THE CHIEF OF PROTOCOL THAN TO ADD CAB
FARE TO THE COST OF AN OFFICIAL VEHICLE TO OR FROM THE DEPARTMENT."
THE CHIEF OF PROTOCOL HOLDS A POSITION WHICH IS UNIQUE IN THE FEDERAL
GOVERNMENT, REQUIRING ATTENDANCE ON VIRTUALLY A DAILY BASIS AT CLEARLY
OFFICIAL FUNCTIONS HELD DURING OTHER THAN BUSINESS HOURS AND LOCATIONS
AWAY FROM STATE DEPARTMENT HEADQUARTERS. AND IT WOULD APPEAR THAT ANY
ADDITIONAL COSTS INCURRED IN TRANSPORTING THE CHIEF OF PROTOCOL TO OR
FROM HER HOME INSTEAD OF TO OR FROM THE STATE DEPARTMENT IN THE
CHAUFFEUR-DRIVEN GOVERNMENT CAR DURING NON-BUSINESS HOURS WOULD BE
MINIMAL. INDEED, IT WOULD SEEM, IN LIGHT OF THE FUNCTION BEING CARRIED
OUT, THAT MUCH OF HER TRANSPORTATION BETWEEN HOME AND WORK SHOULD
PROPERLY BE CLASSIFIED AS OFFICIAL.
ACCORDINGLY, WE WILL NOT AT THIS TIME SEEK TO DISTINGUISH BETWEEN
CIRCUMSTANCES WHEN IT WOULD BE PERMISSIBLE FOR THE CHIEF OF PROTOCOL TO
USE A GOVERNMENT CAR FOR HOME-TO-WORK TRAVEL AND THOSE WHEN IT WOULD NOT
BE. WE THINK, HOWEVER, THAT THE REQUIREMENTS OF MS. ROOSEVELT'S UNUSUAL
JOB, AS WELL AS THE NEEDS OF OTHER GOVERNMENT OFFICIALS, SHOULD BE
COMMUNICATED TO THE OFFICE OF MANAGEMENT AND BUDGET. THIS WAS SUGGESTED
BY CHAIRMAN BROOKS IN HIS LETTER TO OMB LAST JUNE TO AID OMB IN
PREPARING PROPOSED AMENDMENTS TO SECTION 1344.
B-21055.21
December 5, 1986
DIGESTS
CIVILIAN PERSONNEL - TRAVEL - COMMUTING EXPENSES - PERSONNEL
CONVENIENCE - ALLEGATION SUBSTANTIATION - BURDEN OF PROOF
1. The Chairman, House Committee on Government Operations, asked GAO
to investigate allegations that the Commissioner of Customs and his
Assistant Commissioner for Internal Affairs were using Government cars
to travel between their homes and places of work in violation of a
statutory prohibition against such travel. GAO is unable to confirm
these allegations because only one of 5 drivers for the Commissioner
claims to have provided such transportation, the Commissioner flatly
denies the driver's statements, and there are no written records to
refute or support the allegations since the Commissioner ordered the
maintenance of logs to be discontinued shortly after he took office.
CIVILIAN PERSONNEL - TRAVEL - COMMUTING EXPENSES - LIABILITY -
CIVILIAN PERSONNEL - TRAVEL - COMMUTING EXPENSES - REIMBURSEMENT -
ELIGIBILITY
2. All regular drivers for Commissioner of Customs and Assistant
Commissioner for Internal Affairs state that they have at various times
transported both officials in Government cars between their respective
homes and official functions away from the office. Neither official
denies that these trips have taken place although the Commissioner
disputes the assertion of one driver that there were as many as 40 such
trips over a 3 year period. Since neither official is entitled by
statute to receive such transportation, the costs of such trips must be
determined by the officials concerned and repaid to the agency.
CIVILIAN PERSONNEL - TRAVEL - COMMUTING EXPENSES - LIABILITY -
CIVILIAN PERSONNEL - TRAVEL - COMMUTING EXPENSES - REIMBURSEMENT -
ELIGIBILITY
3. Drivers for the Commissioner of Customs state that they made many
trips from the airports in the Washington area to the Commissioner's
Charlottesville, Virginia farm which he calls his "home of record", at
the conclusion of official travel. GAO advises that GSA travel
regulations and our decisions regard an official's "home", for purposes
of compensation for official travel expenses, to be the residence from
which the employee regularly commutes to work. The Commissioner should
calculate the number of such trips he made, the overtime involved for
his driver, and other applicable costs in order to repay these costs to
his agency.
The Honorable Jack Brooks
Chairman, Legislation and
National Security Subcommittee
Committee on Government Operations
House of Representatives
Dear Mr. Chairman:
On August 1, 1986, you asked us to investigate some allegations made
to you that William von Raab, Commissioner of Customs, and his Assistant
Commissioner for Internal Affairs, William F. Green, are currently using
Government cars to travel between their homes and their places of work.
Although we conducted an extensive investigation into these matters, we
could not find sufficient evidence to confirm the allegations. We did
find, however, that there were unauthorized trips between their
respective homes and official functions and between local Washington
airports and the Commissioner's Charlottesville, Virginia home for which
the agency should be reimbursed by the official involved.
At our initial meeting with two Customs officials, the Acting
Comptroller and the Director, Logistics Services, we were told,
categorically, that neither the Commissioner nor the Assistant
Commissioner for Internal Affairs ever uses a Government car for
home-to-work transportation. This was consistent with the information
provided to us by Customs on the questionnaire we used in compiling our
September 16, 1985 report to your Subcommittee, entitled "Use of
Government Motor Vehicles for the Transportation of Government officials
and the Relatives of Government Officials" (GGD-85-76). At that time,
Customs reported that only its four regional commissioners ever used a
car for home-to-work transportation.
We then tried to confirm this information by inspecting vehicle trip
logs, maintained by many agencies to record the names of passengers, the
dates, times of day, points of origin, and destinations for each trip
taken. We found that there were no such logs. The only records kept
concerned the entrance and departure of delivery vehicles, according to
a Building Services official responsible for the operation, maintenance,
and accountability of passenger vehicles located in the Customs
headquarters' garage.
We obtained a partial explanation of the absence of vehicle usage
documents from the chauffeur who was assigned to drive the car dedicated
for the Commissioner's use from January 1981, when the Commissioner
first came to Customs, to August 1984. The driver says that he kept
logs on the Commissioner's travel for approximately 2 months after the
Commissioner was first appointed in 1981, but after the Commissioner
realized what he was doing, he was ordered to discontinue the practice
immediately. A little later, the Commissioner ordered the maintenance
of all logs on passenger travel in Government cars assigned to Customs
to be stopped. The driver was not sure why the order was given but
speculated that it must have something to do with security.
At a later interview, we questioned the Commissioner about the
absence of vehicle usage records at Customs, particularly since we noted
that a draft directive from the Department of the Treasury, dated
February 7, 1986, requires each of its Bureau heads "to establish and
maintain vehicle usage logs on each Government vehicle assigned to their
respective organizations." (We understand that a copy of this Directive
was sent to your staff in May 1986.) Commissioner von Raab said that he
was not aware of the Treasury draft directive. His reason for ordering
the logs to be discontinued was indeed based on security concerns, as
the driver had told us. He said that many of the drivers had "problems"
with drug use and alcohol and could not be trusted not to reveal details
of the goings and comings of top officials at Customs to unauthorized
persons. We told him that the new law governing the use of Federal
vehicles for home-to-work transportation (Pub. L. No. 99550, October
26, 1986) also requires the maintenance of logs or other records of
Federal Government vehicle use between an employee's residence and place
of employment. The Commissioner said he would take this up with his
legal advisor and make "appropriate" adjustments.
After finding that vehicle logs were not maintained, we proceeded to
interview the various individuals who were assigned to drive the two
officials in question over a period of years. We asked each driver
whether he could remember ever driving Mr. von Raab or Mr. Green to or
from their homes and an official duty location. Their responses are
summarized below.
COMMISSIONER VON RAAB
DRIVER 1 - (January 1, 1981 to August 1984.)
Have driven the Commissioner from official functions to his
Alexandria, Virginia home approximately 40 times. Have also driven him
to his farm (approximately 22 miles north of Charlottesville, Virginia)
from National or Dulles airport, approximately 10 times.
DRIVER 2 - (Intermittent duty.)
No trips between home and work. Have driven the Commissioner from
the airport to his Alexandria, Virginia home about three or four times.
DRIVER 3 - (Intermittent duty)
No trips taken between home and work. He drove the Commissioner from
the airport to his Alexandria, Virginia home approximately 10 times.
DRIVER 4 - (About 1 year, ending in July or August, 1985.)
From Alexandria, Virginia home to work--"a lot--maybe 30 or more
times."
From work to Alexandria, Virginia home - "A lot--can't recall how
many times."
From Alexandria, Virginia home to an official function "Yes, but
can't remember how many times."
There were a "lot" of trips from the Alexandria home to the airport
and approximately four or five trips from the airport to Mr. von Raab's
Charlottesville farm.
DRIVER 5 - Currently driving for the Commissioner for the last 14
months.
From Alexandria, Virginia home to official functions-- approximately
four or five times.
From airport to Charlottesville farm - three or four times.
To and from airport and Alexandria, Virginia home - six to 10 times.
ASSISTANT COMMISSIONER GREEN
AGENT/DRIVER 1 - (He has been driving exclusively for Mr. Green (in
addition to his other duties) for the entire 2 years that Mr. Green has
been Assistant Commissioner.)
The agent/driver recalls only two occasions when he drove Mr. Green
to or from his home and work. He added that he also "occasionally"
drives him from his home to a conference away from the office or to and
from other official functions away from the office.
We asked Commissioner von Raab whether the information elicited from
his drivers was accurate. He acknowledged that he had been driven to
and from the airport on a number of occasions, but flatly denied the
report of driver No. 4 that he was driven to and from his Alexandria,
Virginia home and work "a lot--30 or more times." He told us he had
never been driven to and from his Alexandria residence and work. He
informed us that the information from driver No. 4 was not credible.
Aside from various "disciplinary" problems, the employee had sought an
"inspector's" job but had not qualified, for which he blamed the
Commissioner.
The Commissioner's assertion that he has never been driven between
Customs and his Alexandria, Virginia home was supported by Lieutenant
Lee, a security guard in the United States Protective Service, by Ron
Eschenger, deputy director, Logistics and Building Services, (LBS) and
an LBS staff member, Renee Smoot. Lt. Lee pointed out a reserved parking
space for the Commissioner's personal car and said he thinks that the
Commissioner drives himself to and from work every day. Mr. Eschenger
and Ms. Smoot are both involved in the process of authorizing home to
work travel for certain law enforcement agents at Customs. Both said
that they were not aware of any home to work use of Government cars by
either Mr. von Raab or Mr. Green. They stated that both men either
drove themselves or were in carpools.
Commissioner von Raab also found the report of driver No. 1 (that he
was picked up at official functions and driven to his Alexandria home
approximately 40 times) "simply fantastic." The Commissioner said that
he seldom goes to more than one official function per month. He did not
comment on the statements of drivers 4 and 5 who also mentioned driving
him to or from official functions (such as meetings, conferences, and
receptions).
The Commissioner pointed out that he does a lot of work in the car
while on the way to the airport and sometimes sends material back with
the driver. He also keeps in constant touch with the office since the
car is equipped with a telephone. In short, the Commissioner stated,
his use of Government cars was consistent with his understanding of
Customs' regulations and policies at the time he took office. If his
understanding is no longer correct, he will take steps to correct any
erroneous practices.
Assistant Commissioner Green stated that he normally drives to and
from work in his personal vehicle or in a carpool. It is possible that
he was driven from home to work on one or two occasions, he said, but he
does not recall these rides. He was not aware that there was anything
wrong with being driven to functions some distance from the office,
however. He urged us to keep in mind additional considerations--such as
the fact that his driver was also his assistant and much valuable work
could be transacted under secure conditions while they traveled
together. He also mentioned that it was sometimes necessary for the
driver to bring him confidential materials to prepare him for a
conference or speech he had to deliver.
CONCLUSIONS
As you pointed out in your letter to GAO, neither Commissioner von
Raab nor Assistant Commissioner Green was, under the pre-amended
provisions of 31 U.S.C. Sec. 1344, nor is now, under the amendments
enacted by Pub. L. No. 99-550, entitled to home-to-work transportation
in Government cars, except in certain limited emergency situations.
However, the exceptions for narrowly defined emergency situations were
not relied upon by either official. Therefore, if there had been no
discrepancy between the statements on home-to-work transportation by the
Commissioner's driver No. 4 or Assistant Commissioner Green's driver No.
1 and the statements of the two officials, or if vehicle usage logs had
been maintained and had supported the drivers'statements, we would have
found a violation of the law.
We cannot make those findings. In essence, we have a statement by
only 1 of 5 drivers for Commissioner von Raab that he frequently ("maybe
30 or more times") drove him to or from his Alexandria, Virginia home
and the Customs Bureau. This driver drove the Commissioner for barely
one year. Mr. von Raab emphatically denies that he was ever driven to
or from his Alexandria home and his office. We have statements from
five other Customs officials who said firmly that they did not believe
that Commissioner von Raab or Assistant Commissioner Green were ever
driven to or from work and the Customs building.
(Mr. Green's driver reported driving him between his home and his
office on only two occasions during the two years Mr. Green has been an
Assistant Commissioner.) In the absence of objective evidence--i.e.,
written records or logs--to support any of these statements, we cannot
conclude that transportation between their respective homes and offices
was furnished to either man.
The situation is a little different with respect to transportation in
a Government car between the officials' respective homes and official
functions away from their offices. The prohibition in the law is not
limited to travel between an official's home and headquarters, but
covers transportation to and from his home and any official function.
Thus, the statements of the various drivers that such travel took place,
if corroborated, would also require a finding that neither official had
been complying with 31 U.S.C. Sec. 1344. Mr. Green readily admits that
he has "occasionally" been driven from home to a conference or other
official function away from the Customs building, as his driver
reported. As mentioned earlier, he states that he was not aware that
this type of transportation was also prohibited by law. If his
appointment books or other records can establish how often this type of
transportation was provided, he will be able to make appropriate
reimbursement to the agency.
All three regular drivers for Commissioner von Raab from the time he
was appointed in 1981 to date reporst transporting the Commissioner
between his Alexandria, Virginia home and official functions away from
the office. We noted earlier that Mr. von Raab did not expressly deny
receiving this kind of transportation. He only took issue with the
statement of Driver no. 1 that it took place approximately 40 times (in
the 3-year period he was driving for the Commissioner), since he seldom
goes to more than one official function per month.
Although it seems apparent that the Commissioner was driven in a
Government car to or from his home and official functions, we are unable
to determine how many such trips were actually made because, again,
there are no official logs or other records to consult. We will have to
rely on Mr. von Raab's good faith to determine the number of such trips
and the costs incurred, so that he too can reimburse the agency.
We have included various statements by drivers for Commissioner von
Raab concerning a number of trips in a Government car from the airport
to his Charlottesville, Virginia home. 1/ The Commissioner did not
dispute the accuracy of those statements, although he thought that
perhaps the number of such trips was exaggerated. We did not discuss
the validity of the provision of such transportation with the
Commissioner at the time of our interview with him. His legal counselor
suggested that under the GSA Travel Regulations, he was entitled to be
driven to his "home of record" at the conclusion of official travel.
We have subsequently examined the GSA Travel Regulations more
closely. The problem is that Commissioner von Raab chose to regard his
Charlottesville farm as his "home." While the terms "home" or "place of
abode" is not specifically defined in the Federal travel regulations,
other analogous regulations make it clear that these terms refer to the
residence from which an employee regularly commutes to work every day;
i.e., Commissioner von Raab's Alexandria home. See, for example, FTR
para. 2-1.4f and 2 JTR para. C2153. We have issued decisions on this
point on a number of occasions. Thus we rejected a claim for mileage
from the airport by a Defense Department employee who moved his family
300 miles away from his permanent duty station since he maintained
bachelor quarters near his headquarters from which he commuted on
weekdays. B-187360, July 15, 1980. See also Matter of Schwappach,
B-201361, December 30, 1981, and Matter of Morgan, 55 Comp. Gen. 1323
(1976), subsequently modified on other grounds.
We therefore conclude that the Commissioner's use of a Government car
to travel to his Charlottesville farm was also unauthorized. Once
again, because of the absence of travel logs, we will need to rely on
Mr. von Raab to determine the number of such trips made and the costs
incurred, including overtime salary costs for the driver, in order that
he can repay them to the agency.
Although we were not able to provide you with definitive answers
about the extent of the Customs officials' compliance with 31 U.S.C.
1344, we think that the investigation served a useful purpose,
nevertheless. We were able to explain many aspects of the home-to-work
prohibition, both before and after the enactment of Pub. L. No. 99-550,
which were not entirely clear to either official. Further, Commissioner
von Raab advised us that Customs officials will research the recently
enacted legislation on home-to-work transportation as well as existing
Department of Treasury and Customs regulations to ensure that future
uses of Federal vehicles by Customs officials are in conformance with
applicable law.
Sincerely yours,
Comptroller General
of the United States
FOOTNOTE
1/ The drivers also reported a number of trips to or from local
airports and the. Commissioner's Alexandria, Virginia home. We are not
questioning the propriety of those trips under the GSA travel
regulations.
B-210551, FEB 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO HAS NO AUTHORITY TO ORDER THE SUSPENSION OF PROCUREMENT
PROCEEDINGS OR AWARD PENDING THE SMALL BUSINESS ADMINISTRATION SIZE
APPEALS BOARD'S RULING ON AN APPEAL AGAINST THE SMALL BUSINESS SIZE
STANDARD USED IN THE SOLICITATION.
CONTRACT SERVICES CO., INC.:
CONTRACT SERVICES CO., INC. (CSC) PROTESTS ANY AWARD OF A CONTRACT
UNDER SOLICITATION NO. DAEA-83-R-0005, A SMALL BUSINESS SET-ASIDE,
ISSUED BY THE ARMY FOR MOTOR VEHICLE OPERATION AND FLEET MANAGEMENT AT
FORT RITCHIE, MARYLAND, PENDING DETERMINATION BY THE SMALL BUSINESS
ADMINISTRATION'S (SBA) SIZE APPEALS BOARD OF WHETHER THE SMALL BUSINESS
SIZE STANDARD USED BY THE PROCURING AGENCY IS PROPER. CSC REQUESTS THAT
THIS OFFICE SUSPEND ACTION IN THE PROCUREMENT UNTIL A FINAL
DETERMINATION IS MADE. WE DISMISS THE PROTEST.
ON NOVEMBER 10, 1982, CSC CONTACTED THE PROCURING AGENCY BY LETTER
AND ASKED THAT IT BE FORWARDED A COPY OF THE SOLICITATION. THE
CONTRACTING OFFICER THEN REQUESTED THAT CSC IDENTIFY ITSELF AS EITHER A
LARGE OR SMALL BUSINESS, DEFINING A SMALL BUSINESS AS ONE WHOSE AVERAGE
ANNUAL RECEIPTS FOR THE PRECEDING 3 FISCAL YEARS DO NOT EXCEED $2
MILLION. IN RESPONSE, CSC QUESTIONED THE CORRECTNESS OF THE CONTRACTING
OFFICER'S DEFINITION OF A SMALL BUSINESS. CSC ASSERTED THAT THE
APPROPRIATE SIZE STANDARD WAS THAT A CONCERN NOT EXCEED 500 EMPLOYEES.
WHEN THE CONTRACTING OFFICER RENDERED A DECISION IN SUPPORT OF HIS
INITIAL SIZE STANDARD, CSC APPEALED TO THE SBA SIZE APPEALS BOARD IN
ACCORDANCE WITH DEFENSE ACQUISITION REGULATION (DAR) SEC. 1-703(C)(2)
(1976 ED.). AT THAT SAME TIME, CSC REQUESTED THE GENERAL ACCOUNTING
OFFICE TO SUSPEND PROCUREMENT PROCEEDINGS UNTIL THE SIZE APPEALS BOARD
MAKES A FINAL DETERMINATION.
OUR OFFICE HAS NO AUTHORITY, HOWEVER, TO ORDER THE WITHHOLDING OF AN
AWARD IN GENERAL, SEE HOFFMAN-WHITEHEAD CO., B-208472, AUGUST 30, 1982,
82-2 CPD 186, OR OTHERWISE TO REQUIRE THAT PROCUREMENT PROCEEDINGS BE
DELAYED OR SUSPENDED IN THIS TYPE OF SITUATION. ACCORDING TO THE
PROCUREMENT REGULATIONS AT DAR SEC. 1-703(C)(3), IF THE SBA SIZE APPEALS
BOARD AGREES WITH CSC, AND THE RULING IS RECEIVED BEFORE THE RECEIPT OF
INITIAL PROPOSALS, THE SOLICITATION MUST BE MODIFIED TO REFLECT THE
RULING. ALSO, THE CONTRACTING OFFICER "MAY" DELAY INITIAL PROPOSAL
RECEIPT PENDING RESOLUTION OF THE APPEAL, ALTHOUGH THE DECISION WHETHER
TO DO SO IS A MATTER WITHIN HIS BROAD DISCRETION. SEE BAIRD
CORPORATION, B-210136, DECEMBER 20, 1982, 82-2 CPD 556. FINALLY, IF THE
SIZE APPEALS BOARD RULING IS NOT RECEIVED UNTIL AFTER INITIAL PROPOSALS
ARE SUBMITTED, THE REGULATIONS PROVIDE THAT THE RULING WILL NOT APPLY TO
THE CURRENT PROCUREMENT, BUT WILL HAVE PROSPECTIVE EFFECT ONLY, SO THAT
THE RULING DOES NOT AFFECT THE LEGALITY OF THE AWARD. SEE LOGISTICAL
SUPPORT, INC., B-205538, MARCH 10, 1982, 82-1 CPD 227.
THE PROTEST IS DISMISSED.
B-210549, FEB 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT CONSIDER SUPPLIER'S PROTEST OF AGENCY'S POSTAWARD
REFUSAL TO ACCEPT ROOFING MATERIAL AS DOMESTIC PRODUCT WHERE AWARDEE
CERTIFIED IN ITS BID THAT IT WOULD PROVIDE DOMESTIC PRODUCT, BECAUSE IT
IS A MATTER OF CONTRACT ADMINISTRATION FOR CONSIDERATION BY CONTRACTING
AGENCY.
CENTRAL STATES ASSOCIATES:
CENTRAL STATES ASSOCIATES (CSA) PROTESTS THE REFUSAL OF THE VETERANS
ADMINISTRATION (VA) TO ACCEPT UNIROOF HYPALON RUBBER ROOFING SYSTEM,
WHICH CSA IS SUPPLYING, AS A DOMESTIC PRODUCT IN THE PERFORMANCE OF
CONTRACT NO. B-659C-209.
WE DISMISS THE PROTEST.
THE AWARDEE, O.V.CAMPBELL & SONS, APPARENTLY CERTIFIED IN ITS BID
THAT TO COMPLY WITH THE BUY AMERICAN ACT, 41 U.S.C. SEC. 10A (1976), IT
WOULD PROVIDE DOMESTIC MATERIAL IN PERFORMING THE CONTRACT. THE VA HAS
DETERMINED THAT THE UNIROOF HYPALON ROOFING SYSTEM IS NOT A DOMESTIC
MATERIAL. CSA, AS A SUPPLIER, DISPUTES THIS DETERMINATION, CLAIMING
THAT 80 PERCENT OF THE ROOFING SYSTEM IS MANUFACTURED IN THE UNITED
STATES.
COMPLIANCE DURING CONTRACT PERFORMANCE WITH THE BUY AMERICAN
CERTIFICATION IN A BID IS A MATTER OF CONTRACT ADMINISTRATION FOR
RESOLUTION BY THE CONTRACTING AGENCY, NOT OUR OFFICE. SEE LAW
ENFORCEMENT ASSOCIATES, INC., B-205024, APRIL 5, 1982, 82-1 CPD 304.
PROTEST DISMISSED.
B-210544, MAR 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE CONTRACTOR AND ITS SURETY UNDER PAYMENT BOND REFUSE TO
REIMBURSE WORKER FOR LABOR AND MATERIALS FURNISHED IN CONNECTION WITH
PERFORMANCE OF CONTRACT, WORKER'S ONLY REMEDY IS SUIT IN FEDERAL
DISTRICT COURT UNDER MILLER ACT, 40 U.S.C. SEC. 270 (1976). GAO'S
RESPONSIBILITY IS LIMITED TO FURNISHING COPIES OF MILLER ACT CONTRACTS
AND PAYMENT BONDS.
VERN WILLARD:
MR. VERN WILLARD HAS REQUESTED THIS OFFICE'S ASSISTANCE IN CONNECTION
WITH THE REFUSAL BY A CONTRACTOR, MR. VINCE WEBER, TO PAY HIM $141.47
EARNED ON A CONSTRUCTION PROJECT ON UNITED STATES FOREST LAND IN THE MT.
BAKER-SNOQUALMIE RANGER DISTRICT.
ACCORDING TO MR. WILLARD, WHO IS A DUMP TRUCK OWNER-OPERATOR, MR.
WEBER HIRED HIM TO HAUL GRAVEL FOR ROAD CONSTRUCTION AND THE HOURLY RATE
ESTABLISHED BY THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION
FOR DUMP TRUCK LEASING IS $51.02. MR. WILLARD STATES THAT HE WORKED
23-1/2 HOURS, FOR WHICH HE WAS ONLY PAID $45 PER HOUR, FOR A TOTAL OF
$1,057.50, AND THAT MR. WEBER STILL OWES HIM $141.47. MR. WILLARD
FURTHER STATES THAT NOT ONLY DID MR. WEBER REFUSE TO PAY HIM, BUT MR.
WEBER'S SURETY, HERITAGE INSURANCE COMPANY OF AMERICA, HAS REFUSED TO
PAY HIS CLAIM. MR. WILLARD REQUESTS THAT THIS OFFICE CONDUCT AN
INVESTIGATION OF THE SURETY'S OPERATIONS.
THE MILLER ACT, 40 U.S.C. SEC. 270 (1976), PAYMENT BOND IS THE ONLY
PROTECTION PROVIDED BY THE GOVERNMENT FOR PERSONS SUPPLYING LABOR OR
MATERIAL IN THE PROSECUTION OF THE WORK PROVIDED FOR IN A GOVERNMENT
CONSTRUCTION CONTRACT. IN THE EVENT THAT A PERSON SUPPLYING LABOR OR
MATERIALS IS UNABLE TO COLLECT AMOUNTS DUE FOR LABOR OR MATERIALS
FURNISHED, A SUIT MAY BE BROUGHT UNDER THE MILLER ACT, 40 U.S.C. SEC.
270B (1976), FOR COLLECTION UNDER THE PAYMENT BOND IN THE UNITED STATES
DISTRICT COURT.
OUR RESPONSIBILITY TO PERSONS FURNISHING LABOR OR MATERIALS UNDER
GOVERNMENT CONSTRUCTION CONTRACTS IS LIMITED TO FURNISHING COPIES OF
MILLER ACT CONTRACTS AND PAYMENT BONDS WHEN ENTITLEMENT HAS BEEN
ESTABLISHED BY AFFIDAVIT IN THE MANNER PRESCRIBED BY SECTION 3 OF THE
MILLER ACT, 40 U.S.C. SEC. 270C (1976).
OTHER THAN THE REMEDY PROVIDED BY THE MILLER ACT, THE SETTLEMENT OF
OBLIGATIONS BETWEEN CONTRACTORS AND THOSE FURNISHING LABOR AND MATERIALS
IS A MATTER OUTSIDE THE JURISDICTION OF OUR OFFICE, THERE BEING NO
PRIVITY OF CONTRACT BETWEEN SUCH PERSONS AND THE UNITED STATES. SEE
PYRAMID STONE CO., B-203736, JULY 31, 1981, 81-2 CPD 79, AND H.A.SACK
CO., INC., B-203291, JUNE 15, 1981, 81-1 CPD 489, AND CASES CITED
THEREIN.
B-210542, AUG 23, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. ANNUITY PAYMENTS TO THE WIDOW OF A
DECEASED MEMBER UNDER THE RETIRED SERVICEMAN'S FAMILY PROTECTION
PLAN WHICH WERE TERMINATED AT THE TIME OF THE WIDOW'S SUBSEQUENT
MARRIAGE IN NEVADA IN OCTOBER 1963, MAY BE PAID FOR THE PERIOD
RETROACTIVE TO SEPTEMBER 1977 WHEN PAYMENTS TO THE CONTINGENT
BENEFICIARIES WERE DISCONTINUED SINCE A NEVADA COURT ENTERED A
DECREE OF ANNULMENT IN DECEMBER 1963, AS A RESULT OF HER
ALLEGATIONS OF FRAUD. UNDER NEVADA LAW THE MARRIAGE BECAME VOID
AB INITIO WHEN THE DECREE OF ANNULMENT WAS ENTERED.
2. IN DETERMINING THE EFFECT OF A DECEMBER
27, 1963 ANNULMENT OF A MARRIAGE WE WILL FOLLOW THE DECISION IN
THURBER V. UNITED STATES (W. D. WASH., N. D. OCTOBER 28, 1963)
WHICH HELD THAT UNDER NEVADA LAW AN ANNULMENT OF A MARRIAGE BY A
COURT OF COMPETENT JURISDICTION ON THE GROUNDS OF FRAUD ENTITLED
THE PLAINTIFF THEREIN TO REINSTATEMENT OF AN ANNUITY UNDER THE
RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN.
ALICE S. BURDEN:
THIS ACTION IS IN RESPONSE TO A REQUEST FOR AN ADVANCE DECISION FROM
LIEUTENANT COLONEL WILLIAM T. FLYNN, JR., ACCOUNTING AND FINANCE
OFFICER, HEADQUARTERS, AIR FORCE ACCOUNTING AND FINANCE CENTER, AS TO
WHETHER PAYMENT IN THE AMOUNT OF $20,882.84 REPRESENTING REINSTATEMENT
OF AN ANNUITY UNDER THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN MAY
BE MADE TO MRS. ALICE S. BURDEN FOR THE PERIOD SEPTEMBER 1, 1977,
THROUGH AUGUST 31, 1982. THE QUESTION RELATES TO THE EFFECT OF THE
DECEMBER 27, 1963 ANNULMENT IN NEVADA OF MRS. BURDEN'S MARRIAGE IN THAT
STATE AND WHETHER THE ANNULLED MARRIAGE SHOULD BE CONSIDERED VOID FROM
ITS INCEPTION IN LIGHT OF CERTAIN COURT CASES AND DECISIONS OF THIS
OFFICE. FOR THE REASONS SET FORTH BELOW, WE HOLD THAT THE REMARRIAGE
BECAME VOID AB INITIO (FROM ITS INCEPTION) WHEN THE DECREE OF ANNULMENT
WAS ENTERED BY THE NEVADA COURT. THUS, THE PAYMENT OF ANNUITY UNDER THE
PLAN MAY BE MADE FROM THE EARLIEST DATE THAT A CONTINGENT BENEFICIARY
CEASED RECEIVING THE ANNUITY.
THE SUBMISSION WAS FORWARDED TO THIS OFFICE BY THE OFFICE OF THE
DEPUTY ASSISTANT COMPTROLLER FOR ACCOUNTING AND FINANCE AND HAS BEEN
ASSIGNED AIR FORCE SUBMISSION NO. DO-AF-1412 BY THE DEPARTMENT OF
DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE.
ON JULY 21, 1960, LIEUTENANT COLONEL OLIVER D. BURDEN, USAF, ELECTED
TO PARTICIPATE IN THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN, 10
U.S.C. SECS 1431-1446, AT ONE-HALF REDUCED RETIRED PAY TO PROVIDE AN
ANNUITY TO HIS SPOUSE AND UPON HER DEATH OR REMARRIAGE TO HIS SURVIVING
CHILDREN. THE MEMBER RETIRED ON OCTOBER 10, 1960, AND DIED ON OCTOBER
27, 1960. THE MEMBER'S WIDOW BEGAN RECEIVING A MONTHLY SURVIVOR ANNUITY
PAYMENT IN OCTOBER 1960 WHICH CONTINUED UNTIL HER REMARRIAGE ON OCTOBER
9, 1963. THE ANNUITY WAS THEN PAID TO THE SURVIVING CHILDREN UNTIL THE
YOUNGEST CHILD REACHED 18 YEARS OF AGE ON SEPTEMBER 8, 1977. IN
RESPONSE TO THE SURVIVING WIDOW'S PETITION FOR ANNULMENT ON THE GROUNDS
OF FRAUD HER REMARRIAGE IN NEVADA WAS DECLARED "NULL AND VOID" BY A
NEVADA COURT ON DECEMBER 27, 1963. THUS, THE QUESTION WHICH ARISES IS
WHETHER FOR THE PURPOSES OF THE PLAN, MRS. BURDEN WAS CONSIDERED AS
HAVING REMARRIED.
UNDER THE LAW OF THE STATE OF NEVADA, WHERE THE MARRIAGE AND THE
ANNULMENT TOOK PLACE, A MARRIAGE MAY BE ANNULLED ON THE GROUNDS OF FRAUD
AND IF THE CONSENT OF EITHER PARTY WAS OBTAINED BY FRAUD AND THE FRAUD
PROVED, THE MARRIAGE SHALL BE VOID FROM THE TIME ITS NULLITY SHALL BE
DECLARED BY A COURT OF COMPETENT JURISDICTION. SECTIONS 125.300 AND
125.340, NEVADA REVISED STATUTES.
WHILE WE HAVE FOUND NO REPORTED CASE IN NEVADA COURTS INTERPRETING
SECTION 125.340, NEVADA REVISED STATUTES, THE UNITED STATES DISTRICT
COURT, NORTHERN DISTRICT OF CALIFORNIA, SOUTHERN DIVISION, CONSIDERED IN
THE CASE OF SANTUELLI V. FOLSOM, 165 F.SUPP. 224 (1958), A SITUATION
WHERE A WIDOW'S SOCIAL SECURITY BENEFITS WERE TERMINATED BECAUSE OF HER
MARRIAGE IN NEVADA. ON THE QUESTION OF THE ANNULMENT OF THAT MARRIAGE
IN CALIFORNIA, THE COURT HELD THAT SINCE A VOID MARRIAGE IS A NULLITY
UNDER NEVADA LAW FROM ITS INCEPTION, A VOIDABLE MARRIAGE BECOMES VOID AB
INITIO WHEN "A COURT OF COMPETENT AUTHORITY" ENTERS ITS DECREE OF
ANNULMENT. ALSO, IN THE CASE OF THURBER V. UNITED STATES, CIVIL ACTION
NO. 5729, THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF
WASHINGTON, NORTHERN DIVISION, DECIDED ON OCTOBER 28, 1963, THAT THE
ANNULMENT IN NEVADA OF A MARRIAGE CELEBRATED IN HAWAII ON THE GROUNDS OF
FRAUD ENTITLED THE PLAINTIFF TO REINSTATEMENT OF ANNUITY UNDER THE
RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN, FROM THE TIME IT WAS
DISCONTINUED. THUS, THE COURT, IN EFFECT, CONCLUDED THAT SHE HAD NOT
REMARRIED WITHIN THE MEANING OF 10 U.S.C. SEC. 1434(A)(1). A SIMILAR
CONCLUSION WAS REACHED IN HOLLAND V. RIBICOFF, 219 F.SUPP. 274 (D.
OREGON 1962), INVOLVING THE SOCIAL SECURITY LAWS.
THE SANTUELLI AND THURBER CASES WERE FOLLOWED IN B-167960, OCTOBER
23, 1969, B-171355, JANUARY 13, 1971, AND 54 COMP.GEN. 600 (1975).
THE AIR FORCE ASKS WHETHER OUR DECISION IN 54 COMP.GEN. 600 (1975)
AND OTHER DECISIONS DATING BACK TO 1969 WHICH CITED WITH APPROVAL THE
THURBER CASE WOULD BE FOR APPLICATION WHERE THOSE DECISIONS WERE
RENDERED SUBSEQUENT TO THE ANNULMENT OF MRS. BURDEN'S REMARRIAGE. THE
AIR FORCE NOTES THAT ITS DENIAL OF MRS. BURDEN'S CLAIM FOR REINSTATEMENT
OF HER ANNUITY WAS MADE SUBSEQUENT TO OUR DECISION AT 54 COMP.GEN. 600
(1975).
THE EARLIER VIEW OF THIS OFFICE WAS THAT UNDER NEVADA LAW AN
ANNULMENT OF A MARRIAGE OPERATED PROSPECTIVELY ONLY AND DID NOT RENDER A
MARRIAGE VOID AB INITIO. THIS VIEW WAS SET FORTH AT 37 COMP.GEN. 188
(1957) AND 40 COMP.GEN. 103 (1960). IN 40 COMP.GEN. 103, WE STATED THAT
THE PRECEDENTS CONCERNING THE EFFECT OF AN ANNULMENT ON THE STATUS OF A
MARRIAGE UNDER NEVADA LAW WERE NOT ENTIRELY UNIFORM. FURTHERMORE, THAT
CASE CONCERNED THE CLAIM OF MRS. MURIEL S. THURBER FOR AN ANNUITY UNDER
THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN TO WHICH THE DISTRICT
COURT RULED SHE WAS ENTITLED IN ITS OPINION OF OCTOBER 28, 1963.
WHILE 37 COMP.GEN. 188 AND 40 COMP.GEN. 103 HAVE NEVER SPECIFICALLY
BEEN OVERRULED, WE DID ACKNOWLEDGE IN DECISION B-142790, MAY 28, 1965,
THAT 40 COMP.GEN. 103, MRS. THURBER'S CASE, WOULD NOT BE FOLLOWED IN
LIGHT OF THE COURT'S DECISION. HOWEVER, IT IS OUR VIEW THAT THE LAW
CONCERNING ANNULMENTS OF MARRIAGES GRANTED IN NEVADA BECAME SETTLED AT
THE TIME THE COURT RULED IN THE THURBER CASE, OCTOBER 28, 1963. THIS IS
THE CASE EVEN THOUGH THIS OFFICE DID NOT HAVE OCCASION TO CONSIDER AN
ANNULMENT UNDER NEVADA LAW AGAIN UNTIL 1969 AND LATER. B-167960,
OCTOBER 23, 1969; B-171355, JANUARY 13, 1971, AND 54 COMP.GEN. 600
(1975).
THUS, ALTHOUGH MRS. BURDEN'S ANNULMENT WAS GRANTED PRIOR TO A
DECISION OF THIS OFFICE HOLDING THAT AN ANNULMENT IN NEVADA MAY RENDER A
MARRIAGE VOID AB INITIO, HER ANNULMENT WAS GRANTED SUBSEQUENT TO THE
THURBER RULING, AND THEREFORE IN OUR VIEW THE DISPOSITION OF HER CLAIM
MUST BE IN ACCORD WITH THAT RULING.
IN OUR DECISIONS WE HAVE FOLLOWED THE HOLDING IN THURBER THAT THE
WIDOW IS ENTITLED TO REINSTATEMENT OF THE ANNUITY FROM THE TIME THAT IT
WAS DISCONTINUED. HOWEVER, MRS. BURDEN'S CLAIM WAS NOT PRESENTED TO
THIS OFFICE UNTIL JANUARY 19, 1983. SECTION 3702(B) OF TITLE 31, UNITED
STATES CODE, PROVIDES THAT A CLAIM COGNIZABLE BY THE GENERAL ACCOUNTING
OFFICE MUST BE RECEIVED 6 YEARS AFTER THE CLAIM ACCRUES. THUS, THAT
PORTION OF THE CLAIM WHICH ACCRUED PRIOR TO JANUARY 19, 1977, IS BARRED
FROM CONSIDERATION.
AS STATED ABOVE, THE AIR FORCE PAID THE ANNUITY TO THE SURVIVING
CHILDREN AS CONTINGENT BENEFICIARIES UNTIL THE YOUNGEST CHILD REACHED 18
YEARS OF AGE IN SEPTEMBER 1977. MRS. BURDEN WOULD NOT BE ENTITLED TO
RESUMPTION OF THE ANNUITY DURING THE PERIOD THAT PAYMENTS WERE MADE TO A
CONTINGENT BENEFICIARY UNLESS THE AGENCY HAD ACTUAL NOTICE OF HER
ANNULMENT PRIOR TO THAT DATE. SEE 43 COMP.GEN. 531 (1964) AND B-165627,
JANUARY 16, 1969.
ACCORDINGLY, MRS. BURDEN SHOULD BE PAID ANNUITY PAYMENTS UNDER THE
RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN FOR AT LEAST THE PERIOD
BEGINNING SEPTEMBER 1977 UNLESS THE AIR FORCE RECEIVED NOTICE OF THE
ANNULMENT PRIOR TO THAT DATE. IN NO EVENT MAY THE ANNUITY BE PAID FOR
ANY PERIOD PRIOR TO JANUARY 19, 1977, EVEN IF THE AIR FORCE HAD NOTICE
OF THE ANNULMENT SINCE THAT PORTION OF THE CLAIM IS BARRED.
PAYMENT SHOULD BE MADE TO MRS. BURDEN IN ACCORDANCE WITH THE ABOVE.
B-210541, FEB 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST OF PROCUREMENT FOR NONAPPROPRIATED FUND ACTIVITY IS DISMISSED
AS GAO HAS NO AUTHORITY TO CONSIDER A BID PROTEST THAT DOES NOT INVOLVE
THE EXPENDITURE OF APPROPRIATED FUNDS.
PINKERTON'S, INC.:
PINKERTON'S, INC., PROTESTS THE AWARD OF A CONTRACT FOR SECURITY
SERVICES TO BURNS INTERNATIONAL SECURITY, INC., BY THE ARMY & AIR FORCE
EXCHANGE SERVICE UNDER SOLICITATION NO. AAFES-PRS-82-4-82-074.
THE ARMY HAS ADVISED US THAT THE PROCUREMENT DOES NOT INVOLVE THE
EXPENDITURE OF APPROPRIATED FUNDS. OUR OFFICE HAS NO AUTHORITY TO
CONSIDER A PROTEST CONCERNING PROCUREMENTS THAT DO NOT INVOLVE THE
EXPENDITURE OF APPROPRIATED FUNDS. BENDE & SONS, INC., B-205600,
JANUARY 11, 1982, 82-1 CPD 27.
THE PROTEST IS DISMISSED.
B-210536, OCT 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST IS DENIED BECAUSE PROCUREMENT FOR
SPARE PARTS MET ALL REQUIREMENTS FOR AN ACCEPTABLE,
APPROVED-SOURCE, RESTRICTED PROCUREMENT - RESTRICTION MET VALID
GOVERNMENT NEED AND NONAPPROVED SOURCES COULD SUBMIT PROPOSALS AND
COULD BECOME QUALIFIED AFTER EVALUATION OF COMPLETE TECHNICAL DATA
PACKAGE.
2. EVEN THOUGH PROTESTER HAD BEEN ERRONEOUSLY
AWARDED CONTRACTS FOR SPARE PARTS IN THE PAST WITHOUT UNDERGOING
ANY QUALIFICATION PROCEDURE AND WAS ULTIMATELY DETERMINED TO BE
QUALIFIED, CONTRACTING OFFICER ACTED REASONABLY IN REJECTING
PROTESTER, SINCE PROTESTER OFFERED ALTERNATIVE SPARE PARTS AND
PROTESTER'S DATA PACKAGE (REQUIRED BY SOLICITATION) WAS
INSUFFICIENT FOR EVALUATION AND QUALIFICATION BEFORE AWARD TO
ORIGINAL EQUIPMENT MANUFACTURER.
MERCER PRODUCTS & MANUFACTURING CO., INC.:
MERCER PRODUCTS & MANUFACTURING CO., INC. (MERCER), PROTESTS THE
REFUSAL OF THE DEFENSE LOGISTICS AGENCY (DLA) TO CONSIDER IT AN APPROVED
SOURCE FOR SUPPLYING SPARE PARTS DESCRIBED AS "CHAIN, BEAD, NSN
4010-00-583-5109, LOCKHEED-GEORGIA CO. (98897), P/N 375638-3" UNDER
REQUEST FOR QUOTATIONS (RFQ) NO. DLA500-82-U-0238.
WE DENY THE PROTEST.
THE RECORD SHOWS THAT DLA INITIALLY SOLICITED QUOTATIONS FROM THREE
POTENTIAL OFFERORS FOR A QUANTITY OF FIVE BEAD CHAINS; NONE OF THESE
POTENTIAL OFFERORS WAS THE ORIGINAL EQUIPMENT MANUFACTURER. THE NAMES
OF THE THREE FIRMS SOLICITED WERE GENERATED BY A COMPUTER FROM A MASTER
FILE WHICH SUPPOSEDLY CONTAINS THE NAMES OF FIRMS WHICH ARE QUALIFIED TO
SUPPLY THE DESIRED SPARE PARTS BASED UPON PAST PERFORMANCE, ABILITY TO
SUPPLY THE PARTS IN A TIMELY MANNER, AND WILLINGNESS TO PARTICIPATE IN
DLA'S AUTOMATED SPARE PARTS PROCUREMENT PROGRAM. ACCORDING TO DLA, WHEN
THIS AUTOMATED PROCUREMENT SYSTEM WAS IMPLEMENTED IN 1976, THERE WAS NO
REAL QUALIFICATION PROCEDURE AND, THEREFORE, THE COMPUTER FILE ACTUALLY
CONTAINS NAMES OF POTENTIAL OFFERORS WHICH ARE NOT QUALIFIED TO SUPPLY
THE PARTS IN QUESTION AS WELL AS POTENTIAL OFFERORS WHICH ARE QUALIFIED.
MERCER SUBMITTED THE ONLY QUOTATION IN RESPONSE TO THE RFQ AND
OFFERED TO SUPPLY THE FIVE BEAD CHAINS (LOCKHEED PART NO. 375638-3) AT A
PRICE OF $42.10 EACH. BECAUSE MERCER WAS NOT THE ORIGINAL EQUIPMENT
MANUFACTURER NOR AN APPROVED SOURCE FOR LOCKHEED-GEORGIA CO. PART NO.
375638-3, THE CONTRACTING OFFICER REQUESTED HELP FROM AGENCY TECHNICAL
PERSONNEL TO DETERMINE WHETHER THE ALTERNATIVE PART OFFERED BY MERCER
WAS EQUAL TO THE LOCKHEED-GEORGIA CO. PART SPECIFIED IN THE RFQ. EVEN
THOUGH MERCER'S OFFER STATED THAT IT WOULD SUPPLY PARTS WHICH WERE THE
SAME AS SPECIFIED IN THE RFQ, IT IS NOT DISPUTED THAT MERCER INTENDED TO
SUPPLY ALTERNATIVE PARTS. THE AGENCY TECHNICIAN REQUIRED A DETAILED
DRAWING FROM MERCER IN ORDER TO EVALUATE THE MERCER PART. ACCORDINGLY,
THE CONTRACTING OFFICER CALLED MERCER AND REQUESTED A TECHNICAL DATA
PACKAGE FOR EVALUATION PURPOSES. THE CONTRACTING OFFICER ALSO CONTACTED
THE DIRECTORATE OF TECHNICAL OPERATIONS AND ASCERTAINED THAT THE
TECHNICAL DATA PACKAGE WOULD HAVE TO BE EVALUATED BY THE APPROPRIATE
ENGINEERING SUPPORT ACTIVITY AND THAT THE DIRECTORATE OF TECHNICAL
OPERATIONS COULD NOT GUARANTEE THAT AN EVALUATION OF MERCER'S TECHNICAL
DATA PACKAGE WOULD BE COMPLETED IN LESS THAN 50 DAYS. ON SEPTEMBER 10,
1982, THE CONTRACTING OFFICER FORWARDED MERCER'S TECHNICAL DATA PACKAGE
TO THE DIRECTORATE OF TECHNICAL OPERATIONS FOR EVALUATION. ALSO, ON
SEPTEMBER 10, BECAUSE OF THE POTENTIAL DELAY RELATED TO THE TECHNICAL
EVALUATION OF MERCER'S PROPOSED ALTERNATIVE PARTS, THE CONTRACTING
OFFICER SOLICITED A QUOTATION FROM THE ORIGINAL EQUIPMENT MANUFACTURER,
LOCKHEED-GEORGIA CO.
ON SEPTEMBER 28, LOCKHEED-GEORGIA CO. OFFERED TO SUPPLY ITS BEAD
CHAINS AT A PRICE OF $13.56 PER UNIT FOR A MINIMUM PURCHASE OF EIGHT
UNITS. THE CONTRACTING OFFICER NOTIFIED MERCER (BY LETTER OF SEPTEMBER
28) THAT DUE TO THE EXTENDED TIME NECESSARY TO REVIEW ITS DRAWINGS,
MERCER WOULD NOT BE CONSIDERED FURTHER FOR THIS PROCUREMENT; THE
CONTRACTING OFFICER INDICATED THAT EVALUATION WOULD BE COMPLETED "SO AS
TO DETERMINE ACCEPTABILITY FOR FUTURE ACQUISITIONS." ON OCTOBER 13, THE
CONTRACTING OFFICER AWARDED A CONTRACT TO LOCKHEED-GEORGIA CO. FOR
SUPPLYING EIGHT BEAD CHAINS BY PLACING AN ORDER AGAINST A BASIC ORDERING
AGREEMENT BETWEEN LOCKHEED-GEORGIA CO. AND THE CONTRACTING AGENCY.
MERCER CONTENDS THAT IT HAD PREVIOUSLY SUPPLIED THESE BEAD CHAINS TO
DLA ON SEVERAL OCCASIONS AND HAD NEVER BEEN ADVISED BY DLA OR THE USER
ACTIVITIES OF ANY NONCONFORMING PARTS THAT HAD BEEN RECEIVED.
THEREFORE, MERCER BELIEVES IT SHOULD HAVE BEEN CONSIDERED TO BE A
QUALIFIED OFFEROR FOR THIS PROCUREMENT WITHOUT HAVING TO HAVE ITS DATA
PACKAGE EVALUATED. AS THE ONLY OFFEROR WHICH RESPONDED TO THE INITIAL
RFQ, MERCER CONCLUDES THAT IT WAS ENTITLED TO AWARD. FURTHERMORE, MERCER
ARGUES THAT IT WAS NOT ALLOWED TO COMPETE ON AN EQUAL BASIS WITH
LOCKHEED-GEORGIA CO. BECAUSE THE AWARD TO LOCKHEED-GEORGIA CO. WAS BASED
UPON SUPPLY OF EIGHT BEAD CHAINS RATHER THAN THE FIVE BEAD CHAINS
COVERED BY THE ORIGINAL SOLICITATION AND BECAUSE BOTH THE DELIVERY POINT
AND DELIVERY SCHEDULE WERE CHANGED BETWEEN THE TIME OF THE INITIAL
SOLICITATION AND AWARD TO LOCKHEED-GEORGIA CO.
DLA ADMITS THAT MERCER HAD BEEN AWARDED SEVERAL CONTRACTS IN PAST
YEARS FOR SUPPLY OF THESE BEAD CHAINS. DLA REPORTS THAT MERCER HAD NEVER
HAD ITS DATA PACKAGE FOR THIS PART EVALUATED BY THE APPROPRIATE
ENGINEERING SUPPORT ACTIVITY AND, THEREFORE, SHOULD NOT HAVE BEEN
INCLUDED IN THE MASTER COMPUTER FILE AS A QUALIFIED OFFEROR. DLA
CONTENDS THAT THOSE AWARDS MADE TO MERCER IN THE PAST WERE ERRONEOUS IN
VIEW OF THE FACT THAT ALL OFFERORS OF ALTERNATIVE PARTS WERE TO UNDERGO
A TECHNICAL EVALUATION BEFORE THEY WERE CONSIDERED QUALIFIED. DLA ALSO
POINTS OUT THAT MANY OF THE OFFERORS LISTED AS QUALIFIED IN DLA'S
COMPUTER FILE HAD NEVER GONE THROUGH ANY QUALIFYING PROCEDURE AND,
THEREFORE, NOT ALL FIRMS LISTED AS QUALIFIED WERE REALLY QUALIFIED. DLA
REPORTS THAT IT WAS ENCOUNTERING PROBLEMS WITH PARTS SUPPLIED BY FIRMS
WHICH OFFERED TO SUPPLY THE IDENTICAL SPARE PARTS SPECIFIED IN AN RFQ
BUT WHICH, IN REALITY, SUPPLIED ALTERNATIVE SPARE PARTS. THE PRIMARY
PROBLEM ENCOUNTERED BY DLA AND THE USER AGENCIES CONCERNED SPARE PART
FAILURES RESULTING IN FAILURE OF THE WEAPON SYSTEMS OR EQUIPMENT IN
WHICH THE SPARE PARTS HAD BEEN USED AND THE POSSIBLE INJURY TO USING
MILITARY PERSONNEL OR EVEN LOSS OF LIVES. A SECONDARY PROBLEM CONCERNS
POSSIBLE UNFAIR ADVANTAGES ACCRUING TO SPARE PART SUPPLIERS WHO OBTAIN
CONTRACTS BY MISREPRESENTING THAT THEY WILL SUPPLY THE IDENTICAL PARTS
SPECIFIED IN AN RFQ.
DLA ALSO ARGUES THAT THE INITIAL RFQ SPECIFICALLY REQUIRED OFFERORS
OF OTHER THAN LOCKHEED-GEORGIA CO. PART NO. 375638-3 TO SUBMIT A
COMPLETE DATA PACKAGE FOR EVALUATION PURPOSES IN ORDER TO BE CONSIDERED
FOR AWARD AND THAT MERCER DID NOT SUBMIT ANY TECHNICAL DATA UNTIL THE
CONTRACTING OFFICER REQUESTED THAT IT DO SO ON AUGUST 31. DLA CONTENDS
THAT THE DRAWING SUBMITTED BY MERCER FOR TECHNICAL EVALUATION IN
RESPONSE TO THE CONTRACTING OFFICER'S REQUEST WAS INADEQUATE BECAUSE IT
DID NOT SHOW WHAT MATERIAL WOULD BE USED IN THE MANUFACTURE OF THE BEAD
CHAINS. MERCER WAS ADVISED BY LETTER OF OCTOBER 2, 1982, THAT ITS
TECHNICAL DATA PACKAGE WAS NOT CONSIDERED COMPLETE AND FILED A PROTEST
WITH DLA BY LETTER OF OCTOBER 5. DLA DENIED MERCER'S PROTEST ON JANUARY
17, 1983. SUBSEQUENTLY, DLA ADVISED MERCER OF THE DEFICIENCIES IN ITS
DATA PACKAGE AND MERCER SENT THEM THE LATEST REVISION OF ITS DRAWING AND
A SAMPLE PART FOR EVALUATION. BASED UPON THIS MATERIAL, THE ENGINEERING
SUPPORT ACTIVITY DETERMINED ON MARCH 17 THAT MERCER'S PRODUCT WAS EQUAL
TO LOCKHEED-GEORGIA CO.'S PART AND THAT MERCER WAS A QUALIFIED OFFEROR
FOR THIS PART. HOWEVER, LOCKHEED-GEORGIA CO. HAD DELIVERED ALL EIGHT
BEAD CHAINS ON FEBRUARY 2. THEREFORE, DLA POINTS OUT THAT WHILE MERCER
COULD NOT COMPETE FOR THE SUBJECT PROCUREMENT, MERCER WILL BE CONSIDERED
FOR ALL FUTURE PROCUREMENTS FOR THIS PART. DLA CONTENDS THAT THE ABOVE
EVENTS SHOW "THE DOGGED PURSUIT OF ITEM BREAKOUTS" BY THE CONTRACTING
ACTIVITY AND THE EFFORTS MADE TO "BREAK" THE SOLE-SOURCE CHAIN. BECAUSE
OF ITS EFFORTS, DLA STATES THAT ALL FUTURE PROCUREMENTS FOR THESE BEAD
CHAINS WILL BE ON A COMPETITIVE BASIS.
THE DEFENSE ACQUISITION REGULATION (DAR) SEC. 1-313 (1976 ED.)
PERMITS THE PROCUREMENT OF SPARE PARTS ON A RESTRICTED BASIS IN
APPROPRIATE CIRCUMSTANCES. HOWEVER, THE VALIDITY OF ANY PROCEDURE WHICH
LIMITS THE EXTENT OF COMPETITION DEPENDS UPON WHETHER THE RESTRICTION
SERVES A BONA FIDE NEED OF THE GOVERNMENT. SUCH RESTRICTIONS INCLUDE
THOSE ESSENTIAL TO ASSURE PROCUREMENT OF A SATISFACTORY END PRODUCT OR
TO DETERMINE THE HIGH LEVEL OF QUALITY AND RELIABILITY ASSURANCE
NECESSITATED BY THE CRITICALITY OF THE PRODUCT. DEPARTMENT OF
AGRICULTURE'S USE OF MASTER AGREEMENT, 54 COMP.GEN. 606, 609 (1975),
75-1 CPD 40. BASIC CHARACTERISTICS OF APPROVED, ALTHOUGH RESTRICTIVE,
PROCEDURES ARE THAT THEY FUNCTION SO THAT (1) NO FIRM WHICH IS ABLE TO
PROVIDE A SATISFACTORY PRODUCT IS NECESSARILY PRECLUDED FROM COMPETING
ON PROCUREMENTS OF THAT ITEM; AND (2) A FIRM MAY BECOME ELIGIBLE TO
COMPETE AT ANY TIME IT DEMONSTRATES UNDER SUITABLE PROCEDURES THAT IT IS
ABLE TO FURNISH AN ACCEPTABLE ITEM WHICH MEETS THE GOVERNMENT'S NEEDS.
DEPARTMENT OF AGRICULTURE'S USE OF MASTER AGREEMENT, SUPRA, AT 609.
THUS, WHILE DAR SEC. 1-313(C) ALLOWS A PROCURING ACTIVITY TO SOLICIT
ONLY APPROVED SUPPLIERS, IT DOES NOT PRECLUDE THE SUBMISSION AND
CONSIDERATION OF PROPOSALS FROM UNAPPROVED SOURCES WHICH CAN OTHERWISE
QUALIFY THEIR PRODUCTS UNDER SUITABLE TESTING PROCEDURES. SEE METAL
ART, INC., B-192579, APRIL 3, 1979, 79-1 CPD 229. MOREOVER, OUR OFFICE
HAS CONSISTENTLY TAKEN THE POSITION THAT AGENCIES MUST GIVE ALTERNATE
PRODUCERS AN OPPORTUNITY TO QUALIFY WHEN PROCURING REPLACEMENT PARTS
PURSUANT TO DAR SEC. 1-313(C). SEE PARKER HANNIFIN CORPORATION,
B-199937, OCTOBER 2, 1981, 81-2 CPD 270.
WE FIND NO BASIS FOR SUSTAINING MERCER'S PROTEST. EVEN THOUGH MERCER
HAD BEEN SOLICITED FOR AND AWARDED CONTRACTS IN THE PAST, THE FACT
REMAINS THAT NEITHER DLA NOR THE APPROPRIATE ENGINEERING SUPPORT
ACTIVITY HAD EVER FULLY EVALUATED MERCER'S DATA PACKAGE AND BEAD CHAIN.
ACCORDING TO DLA, AWARDS WHICH HAD BEEN MADE TO MERCER FOR THIS PART
WERE MADE BY MISTAKE BECAUSE THE MASTER COMPUTER FILE FOR DLA'S
AUTOMATED SPARE PARTS PROCUREMENT PROGRAM CONTAINED NAMES OF FIRMS WHICH
HAD NEVER UNDERGONE ANY DATA EVALUATION, PRODUCT TESTING, OR OTHER
QUALIFICATION PROCEDURE. MOREOVER, IN VIEW OF THE FACT THAT DLA PROCURES
SPARE PARTS FOR VARIOUS WEAPONS SYSTEMS AND SPARE PART FAILURES CAN LEAD
TO INJURY OR EVEN DEATH TO MILITARY PERSONNEL WHO USE THE EQUIPMENT, WE
ARE NOT PREPARED TO SAY THAT THE REQUIREMENT FOR QUALIFICATION OF
OFFERORS IS IMPROPER SINCE SAFETY IN THE USE OF SUCH EQUIPMENT IS A BONA
FIDE GOVERNMENT NEED. SEE HILL INDUSTRIES, B-210093, JULY 6, 1983, 83-2
CPD 59.
THE RFQ PUT MERCER AND OTHER POTENTIAL OFFERORS OF ALTERNATIVE PARTS
ON NOTICE THAT COMPLETE EVALUATION DATA WOULD BE REQUIRED IN ORDER TO BE
CONSIDERED FOR AWARD. MERCER DID NOT SUBMIT ITS DRAWING UNTIL SUCH
INFORMATION WAS SPECIFICALLY REQUESTED BY THE CONTRACTING OFFICER AND,
EVEN THEN, THE DATA PACKAGE DID NOT INCLUDE REFERENCE TO THE TYPE OF
MATERIAL TO BE USED IN THE MANUFACTURE OF THE BEAD CHAINS. THE JUDGMENT
OF THE TECHNICAL PERSONNEL OF THE PROCURING AGENCY AS TO THE TECHNICAL
ADEQUACY OF MERCER'S OFFER WILL NOT BE QUESTIONED BY OUR OFFICE ABSENT A
CLEAR SHOWING OF UNREASONABLENESS. SEE INTERAD, LTD., B-210013, MAY 10,
1983, 83-1 CPD 497. THE CONTRACTING OFFICER WAS INVESTED WITH A
REASONABLE AMOUNT OF DISCRETION IN THE EVALUATION OF MERCER'S OFFER.
INTERAD, LTD., SUPRA. IN VIEW OF THE FACT THAT MERCER DID NOT SUBMIT
ITS SAMPLE BEAD CHAIN UNTIL AFTER THE CONTRACT HAD BEEN AWARDED TO
GEORGIA-PACIFIC CO. AND BECAUSE, WITHOUT THE SAMPLE, THE ENGINEERING
SUPPORT ACTIVITY COULD NOT DETERMINE THAT MERCER'S OFFER OF ALTERNATIVE
PARTS WAS CONFORMING TO THE RFQ'S REQUIREMENTS, WE CANNOT FIND THAT THE
CONTRACTING OFFICER ACTED UNREASONABLY OR ABUSED HIS DISCRETION IN
REJECTING MERCER'S OFFER AND AWARDING TO THE ORIGINAL EQUIPMENT
MANUFACTURER. NOTWITHSTANDING THE FACT THAT MERCER HAD BEEN AWARDED
CONTRACTS IN THE PAST WITHOUT AN EVALUATION OF ITS PARTS, BECAUSE
MERCER'S DATA PACKAGE WAS NOT COMPLETE BY THE TIME OF AWARD, IT IS OUR
VIEW THAT MERCER HAS NOT PROVIDED SUFFICIENT EVIDENCE TO SHOW THAT THE
AGENCY'S CONCLUSIONS THAT THE DATA INITIALLY SUBMITTED WAS INSUFFICIENT
AND, BASED UPON INFORMATION AVAILABLE TO THE CONTRACTING OFFICER AT THE
TIME OF AWARD, THAT MERCER SHOULD NOT RECEIVE THE AWARD WERE
UNREASONABLE. SEE COMPRESSOR ENGINEERING CORPORATION, B-206879, OCTOBER
29, 1982, 82-2 CPD 383; ALLIED SALES & ENGINEERING, INC., B-203913,
B-204102, JANUARY 8, 1982, 82-1 CPD 23.
WE FIND THAT DLA HAS MET ALL OF THE REQUIREMENTS FOR AN ACCEPTABLE,
RESTRICTED PROCUREMENT. THE PRIMARY REASON FOR RESTRICTING THE
PROCUREMENT - SAFETY OF MILITARY PERSONNEL - IS A VALID GOVERNMENT NEED.
ADDITIONALLY, DLA SOLICITED AN OFFER FROM MERCER AND ATTEMPTED TO HAVE
MERCER QUALIFY BEFORE AWARD WAS MADE TO ANY OTHER FIRM. FINALLY, DLA
ADVISES US THAT MERCER ULTIMATELY WAS QUALIFIED AND WILL BE CONSIDERED
FOR FUTURE PROCUREMENTS. SEE, FOR EXAMPLE, HILL INDUSTRIES, SUPRA.
IN VIEW OF OUR CONCLUSION THAT MERCER WAS PROPERLY REJECTED, WE NEED
NOT CONSIDER MERCER'S ALLEGATIONS THAT THE TERMS OF GEORGIA-PACIFIC
CO.'S CONTRACT DIFFER FROM THE TERMS UNDER WHICH MERCER WAS SOLICITED.
THE PROTEST IS DENIED.
B-210535, FEB 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE PROTEST ALLEGING DEFECT IN SOLICITATION IS NOT FILED UNTIL
AFTER BID OPENING, GAO BID PROTEST PROCEDURES GENERALLY REQUIRE THAT
SUCH PROTEST BE DISMISSED AS UNTIMELY. THAT RULE IS INAPPLICABLE,
HOWEVER, WHERE PROTESTER DID NOT RECEIVE AMENDMENT CONTAINING ALLEGED
DEFECT UNTIL 1 DAY BEFORE BID OPENING AND THEREFORE DID NOT HAVE A
REASONABLE OPPORTUNITY TO FILE PROTEST BEFORE BID OPENING.
2. PROTEST THAT BID OPENING SHOULD HAVE BEEN EXTENDED IS UNTIMELY
WHEN NOT FILED WITHIN 10 DAYS AFTER PROTESTER KNEW OR SHOULD HAVE KNOWN
THAT OPENING WOULD NOT BE EXTENDED.
3. CLAIM FOR BID PREPARATION COSTS SUBMITTED IN CONNECTION WITH AN
UNTIMELY PROTEST WILL NOT BE CONSIDERED.
THE BIG PICTURE COMPANY:
THE BIG PICTURE COMPANY PROTESTS THE CONTRACTING OFFICER'S DENIAL OF
ITS REQUEST THAT HE EXTEND THE BID OPENING DATE UNDER INVITATION FOR
BIDS (IFB) NO. F41605-82-B-0045 ISSUED BY LAUGHLIN AIR FORCE BASE,
TEXAS. THE PROTESTER CONTENDS THAT IT DID NOT RECEIVE AN AMENDMENT TO
THE SOLICITATION, WHICH CHANGED THE ORIGINAL BID OPENING DATE AND
MODIFIED "A SIGNIFICANT ASPECT OF THE ORIGINAL SPECIFICATIONS," UNTIL 1
DAY BEFORE THE AMENDED BID OPENING DATE. IT ARGUES, THEREFORE, THAT IT
DID NOT HAVE AN OPPORTUNITY TO REVISE ITS BID IN TIME TO MEET THE NEW
OPENING DATE. WE DISMISS THE PROTEST.
THE SOLICITATION WAS ISSUED ON OCTOBER 19, 1982 WITH AN AMENDED BID
OPENING DATE OF DECEMBER 21. THE PROTESTER STATES THAT WHEN IT RECEIVED
THE SUBJECT AMENDMENT, IT CONTACTED THE CONTRACTING OFFICER ON DECEMBER
20 AND ASKED FOR AN EXTENSION OF THE BID OPENING DATE, TO WHICH HE "DID
NOT REPLY EITHER NEGATIVELY OR AFFIRMATIVELY." WE HAVE BEEN ADVISED,
HOWEVER, THAT BID OPENING WAS CONDUCTED AS SCHEDULED ON DECEMBER 21.
GENERALLY, TO BE TIMELY UNDER OUR BID PROTEST PROCEDURES, A PROTEST
MUST BE FILED PRIOR TO BID OPENING IF, AS HERE, IT IS BASED ON ALLEGED
IMPROPRIETIES IN THE SOLICITATION WHICH ARE APPARENT ON THE FACE OF THE
SOLICITATION. 4 C.F.R. SEC. 21.2(B)(1) (1982). IN THIS CASE, HOWEVER,
SINCE BIG PICTURE DID NOT RECEIVE THE AMENDMENT UNTIL 1 DAY BEFORE BID
OPENING, WE BELIEVE THAT SEC. 21.2(B)(1) IS INAPPLICABLE BECAUSE BIG
PICTURE DID NOT HAVE A REASONABLE OPPORTUNITY TO FILE ITS PROTEST BEFORE
BID OPENING. CULLIGAN, INC., 58 COMP.GEN. 307 (1979), 79-1 CPD 149.
BIG PICTURE'S PROTEST IS UNTIMELY, HOWEVER, BECAUSE IN CASES OTHER
THAN THOSE COVERED BY SEC. 21.2(B)(1), BID PROTESTS MUST BE FILED NOT
LATER THAN 10 WORKING DAYS AFTER THE BASIS FOR PROTEST IS KNOWN OR
SHOULD HAVE BEEN KNOWN, 4 C.F.R. SEC. 21.2(B)(2); CULLIGAN, INC.,
SUPRA. HERE, BIG PICTURE'S PROTEST WAS NOT FILED WITH OUR OFFICE UNTIL
JANUARY 19, MORE THAN 10 WORKING DAYS AFTER IT KNEW OR SHOULD HAVE KNOWN
THAT BID OPENING WOULD NOT BE EXTENDED.
FINALLY, THE PROTESTER REQUESTS THAT WE AWARD IT BID PREPARATION
COSTS. OUR OFFICE WILL NOT CONSIDER SUCH A CLAIM WHERE IT IS SUBMITTED
IN CONNECTION WITH AN UNTIMELY PROTEST. LEE ROOFING CO., B-201154,
MARCH 16, 1981, 81-1 CPD 197.
THE PROTEST AND CLAIM ARE DISMISSED.
B-210534, FEB 18, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST BY LARGE BUSINESS AGAINST PROCUREMENT SET-ASIDE FOR SMALL
BUSINESS CONCERNS IS DISMISSED UNDER 4 C.F.R. SEC. 21.2(B)(1) BECAUSE IT
WAS NOT FILED PRIOR TO BID OPENING.
SHAYNE BROTHERS, INC.:
SHAYNE BROTHERS, INC. (SBI), PROTESTS AGAINST AN AWARD TO ANYONE
OTHER THAN SBI UNDER SOLICITATION NO. GS-11C-30038, A SMALL BUSINESS
SET-ASIDE, ISSUED BY THE GENERAL SERVICES ADMINISTRATION. SBI COMPLAINS
THAT ALTHOUGH IT IS THE LOW RESPONSIVE, RESPONSIBLE BIDDER, IT IS NOT
BEING CONSIDERED FOR AN AWARD BECAUSE IT IS NOT A SMALL BUSINESS. SBI
CONTENDS THAT AN AWARD TO ANY OTHER BIDDER COULD PRODUCE EXCESSIVE COSTS
TO THE GOVERNMENT OF AT LEAST $75,000 PER YEAR, OR 19 PERCENT. IN
ADDITION, SBI POINTS OUT THAT IT IS THE INCUMBENT CONTRACTOR AND IS
CAPABLE OF CONTINUING THE WORK. WE DISMISS THE PROTEST.
FEDERAL PROCUREMENT REGULATIONS SEC. 1-1.706-5(A)(2) (1964 ED.
AMEND. 192) PROVIDES THAT PROCUREMENTS SHALL BE SET-ASIDE FOR SMALL
BUSINESS CONCERNS IF THERE IS A REASONABLE EXPECTATION THAT OFFERS WILL
BE OBTAINED FROM A SUFFICIENT NUMBER OF SMALL BUSINESS CONCERNS AND THAT
AWARD WILL BE MADE AT A REASONABLE PRICE. THE DECISION AS TO WHETHER
SUCH AN EXPECTATION EXISTS IS BASICALLY A BUSINESS JUDGMENT WITHIN THE
BROAD DISCRETION OF THE CONTRACTING OFFICIALS; ACCORDINGLY, OUR REVIEW
OF CHALLENGES TO SET-ASIDE DECISIONS IS GENERALLY LIMITED TO
ASCERTAINING WHETHER THERE HAS BEEN AN ABUSE OF DISCRETION.
INGERSOLL-RAND, B-207005, APRIL 12, 1982, 82-1 CPD 338.
IN ADDITION, SBI'S PROTEST IS UNTIMELY UNDER OUR BID PROTEST
PROCEDURES, 4 C.F.R. PART 21 (1982), WHICH REQUIRE PROTESTS BASED ON
ALLEGED IMPROPRIETIES APPARENT IN SOLICITATIONS BE FILED WITH OUR OFFICE
PRIOR TO BID OPENING. 4 C.F.R. SEC. 21.2(B)(1) (1982). HERE, THE
SOLICITATION WAS CLEARLY SET-ASIDE FOR SMALL BUSINESS BUT SBI DID NOT
PROTEST UNTIL 1 WEEK AFTER BID OPENING.
THE PROTEST IS DISMISSED.
B-210531.OM., APR 14, 1983
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
THE COMPTROLLER GENERAL:
WE ARE FORWARDING THE FILE PERTAINING TO THE APPARENT VIOLATIONS OF
THE DAVIS-BACON ACT, 40 U.S.C. 276A, BY SCHMELZ BROTHERS, INC.,
GLENDALE, NEW YORK, WHICH PERFORMED WORK UNDER NATIONAL PARK SERVICE
CONTRACT NO. CX-1600-7-9010 AT STATUE OF LIBERTY NATIONAL MONUMENT,
ELLIS ISLAND, NEW YORK.
DETAILS OF THE VIOLATIONS AND ADMINISTRATIVE RECOMMENDATIONS
CONCERNING DEBARMENT ARE CONTAINED IN THE ATTACHED INVESTIGATIVE REPORT
AND DEPARTMENT OF LABOR TRANSMITTAL LETTER.
WE PROPOSE, WITH YOUR APPROVAL, TO DISBURSE THE $4,084.54 ON DEPOSIT
HERE TO THE ONE AGGRIEVED WORKER IN ACCORDANCE WITH ESTABLISHED
PROCEDURES. OUR PROPOSAL AND THE MATTER OF WHETHER THE CONTRACTOR'S
NAME SHOULD BE PLACED ON THE DEBARRED BIDDERS LIST FOR VIOLATIONS UNDER
THE DAVIS-BACON ACT ARE FORWARDED FOR YOUR CONSIDERATION AND
INSTRUCTIONS.
FOR FURTHER INFORMATION, PLEASE CONTACT MYRON COLBREUNER ON EXTENSION
53218.
INDORSEMENT
ASSOCIATE DIRECTOR, AFMD-CLAIMS GROUP
RETURNED. THE VIOLATIONS OF THE DAVIS-BACON ACT BY SCHMELZ BROTHERS,
INC., GLENDALE, NEW YORK, A SUBCONTRACTOR FOR LINWOOD ROOFING AND
CONTRACTING, ON NATIONAL PARK SERVICE CONTRACT NO. CX-1600-7-9010
PERFORMED AT THE STATUE OF LIBERTY NATIONAL MONUMENT, ELLIS ISLAND, NEW
YORK, WERE CLASSIFICATION VIOLATIONS. SCHMELZ BROTHERS CLASSIFIED AND
PAID A WORKER AS A PLUMBER'S HELPER WHEN THE EVIDENCE INDICATES THAT THE
CLASSIFICATION AND PAYMENT SHOULD HAVE BEEN THAT OF A PLUMBER. HOWEVER,
THERE DOES NOT APPEAR TO HAVE BEEN ANY WILLFUL DECEPTION ON THE PART OF
EITHER THE CONTRACTOR OR SUBCONTRACTOR. THE PAYROLLS WERE NOT
FALSIFIED. THE AMOUNT PAID THE WORKER WAS CORRECTLY INDICATED ON THE
PAYROLLS, AS WELL AS THE ERRONEOUS CLASSIFICATION. THE RECORD INDICATES
THAT THE VIOLATIONS WERE THE RESULT OF A BONA FIDE DISAGREEMENT OR
DISPUTE CONCERNING CLASSIFICATION OF THE EMPLOYEE IN QUESTION. SEE
B-207644-O.M., OCTOBER 20, 1982. THEREFORE, WE ARE OF THE VIEW THAT
NEITHER THE SUBCONTRACTOR NOR THE PRIME CONTRACTOR SHOULD BE DEBARRED
SINCE NOT ONLY WERE THE VIOLATIONS NOT OF SUCH A WILLFUL NATURE AS TO
WARRANT DEBARMENT, BUT IT HAS BEEN APPROXIMATELY 5 YEARS SINCE THE
VIOLATIONS OCCURRED. IF WE WERE TO INITIATE DEBARMENT PROCEEDINGS AT
THIS TIME, DUE PROCESS WOULD HAVE TO BE ACCORDED THE SUBCONTRACTOR. DUE
PROCESS IN THIS CASE WOULD ENTAIL, AT THE MINIMUM, NOTICE AND SOME SORT
OF HEARING WHICH WOULD FURTHER DELAY REIMBURSEMENT OF THE UNDERPAID
WORKER. SEE B-195948-O.M., NOVEMBER 5, 1979. NEITHER THE DEPARTMENT OF
LABOR NOR THE CONTRACTING AGENCY RECOMMENDS DEBARMENT.
ACCORDINGLY, THE FUNDS ON DEPOSIT WITH YOUR OFFICE MAY BE DISBURSED
TO THE AGGRIEVED WORKER IN ACCORDANCE WITH ESTABLISHED PROCEDURES.
B-210528, AUG 25, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
A MEMBER STATIONED OVERSEAS WHO HAD PURCHASED
A FOREIGN-MADE VEHICLE OVERSEAS PRIOR TO ENTRY
ON ACTIVE DUTY MAY NOT BE REIMBURSED THE
EXPENSES OF SHIPPING THE PRIVATELY OWNED VEHICLE
WHEN HE RECEIVED PERMANENT CHANGE-OF-STATION
ORDERS TO THE UNITED STATES SINCE 1 JOINT
TRAVEL REGULATIONS, PARA. M11002-3, SPECIFICALLY
PROHIBITS THE SHIPMENT OF FOREIGN-MADE
PRIVATELY OWNED VEHICLES AT GOVERNMENT EXPENSE.
FIRST LIEUTENANT MICHAEL C. LISKA, USAF:
FIRST LIEUTENANT MICHAEL C. LISKA, USAF, REQUESTS RECONSIDERATION OF
OUR CLAIMS GROUP'S DENIAL OF HIS CLAIM FOR REIMBURSEMENT OF EXPENSES
INCURRED IN SHIPPING HIS FOREIGN-MADE PRIVATELY OWNED AUTOMOBILE FROM
GERMANY TO THE CONTINENTAL UNITED STATES. THE DENIAL OF THE CLAIM IS
SUSTAINED.
LIEUTENANT LISKA HAD PURCHASED A FOREIGN-MADE AUTOMOBILE IN 1978 IN
BELGIUM, WHERE HIS PARENTS RESIDE. THIS PURCHASE OCCURRED PRIOR TO HIS
ENTRY ON ACTIVE DUTY. HE RECEIVED ORDERS ADDRESSED TO HIM AT HIS
PARENTS' RESIDENCE IN BELGIUM IN 1979 ORDERING HIM TO REPORT TO BITBURG
AIR BASE (AB), GERMANY, AFTER 9 WEEKS' TEMPORARY DUTY AT SHEPPARD AIR
FORCE BASE (AFB), TEXAS. HIS ORDERS INDICATED THAT HE WAS AUTHORIZED TO
SHIP A PRIVATELY OWNED VEHICLE OVERSEAS. HOWEVER, HIS AUTOMOBILE WAS
ALREADY LOCATED OVERSEAS IN BELGIUM. HE LEFT HIS AUTOMOBILE THERE WHILE
ON TEMPORARY DUTY AT SHEPPARD AFB AND THEN DROVE IT TO BITBURG, AB,
WHERE HE USED IT DURING HIS 2 YEARS THERE.
IN 1981, LIEUTENANT LISKA RECEIVED PERMANENT CHANGE-OF-STATION ORDERS
TO WRIGHT-PATTERSON AIR FORCE BASE (AFB), OHIO. THE BITBURG
TRANSPORTATION MOVEMENT OFFICE INDICATED THAT HE COULD NOT SHIP HIS
PRIVATELY OWNED AUTOMOBILE TO THE CONTINENTAL UNITED STATES BECAUSE HE
HAD NOT BROUGHT IT OVER WITH HIM FROM THE CONTINENTAL UNITED STATES AND
THE PROVISIONS OF CHAPTER 11, OF VOLUME 1, JOINT TRAVEL REGULATIONS
(JTR), PRECLUDED SHIPMENT AT GOVERNMENT EXPENSE. AS A RESULT LIEUTENANT
LISKA SHIPPED HIS PRIVATELY OWNED AUTOMOBILE THROUGH A PRIVATE SHIPPING
COMPANY FROM BELGIUM TO BALTIMORE. SINCE HE THEN DID NOT GET PERMISSIVE
TEMPORARY DUTY TO PICK UP AND DELIVER HIS PRIVATELY OWNED AUTOMOBILE AT
BALTIMORE, HE HAD TO USE 2 DAYS OF ANNUAL LEAVE AND PAY FOR RELATED
EXPENSES TO TRANSPORT HIS CAR FROM BALTIMORE TO WRIGHT-PATTERSON AFB.
LIEUTENANT LISKA THEN MADE A CLAIM TO BE REIMBURSED FOR HIS EXPENSES
INCURRED IN SHIPPING, PICKING UP, AND DELIVERING HIS PRIVATELY OWNED
AUTOMOBILE AND FOR THE LEAVE TAKEN.
THE AIR FORCE FORWARDED THE CLAIM TO OUR CLAIMS GROUP BECAUSE OF A
DOUBTFUL QUESTION OF LAW. BY SETTLEMENT CERTIFICATE Z-2843138, DATED
OCTOBER 25, 1982, OUR CLAIMS GROUP DISALLOWED LIEUTENANT LISKA'S CLAIM.
IN HIS REQUEST FOR RECONSIDERATION, LIEUTENANT LISKA MAKES TWO
CONTENTIONS. FIRST, HE NOTES THAT CHAPTER 11 OF 1 JTR APPLIES PRIMARILY
TO THE SHIPMENT OF A PRIVATELY OWNED VEHICLE FROM A LOCATION IN THE
CONTINENTAL UNITED STATES TO AN OVERSEAS LOCATION AND BACK TO A LOCATION
IN THE CONTINENTAL UNITED STATES. HE ARGUES THAT SINCE HE ORIGINATED
FROM AN OVERSEAS LOCATION, ENTERED INTO THE AIR FORCE OVERSEAS, AND
BOUGHT AN AUTOMOBILE OVERSEAS, THE REGULATIONS DO NOT ADDRESS HIS
SITUATION AND HE SHOULD NOT BE DENIED REIMBURSEMENT ON THAT BASIS.
SECOND, LIEUTENANT LISKA CONTENDS THAT SINCE HIS PERMANENT
CHANGE-OF-STATION ORDERS TO BITBURG AB AUTHORIZED HIM TO SHIP A
PRIVATELY OWNED VEHICLE OVERSEAS, HE SHOULD HAVE BEEN AUTHORIZED TO SHIP
HIS PRIVATELY OWNED AUTOMOBILE FROM OVERSEAS TO THE CONTINENTAL UNITED
STATES.
CHAPTER 11 OF 1 JTR, PARAGRAPH M11002-3, IN EFFECT AT THE TIME OF THE
SHIPMENT, PROVIDES THAT TRANSPORTATION AT GOVERNMENT EXPENSE OF A
FOREIGN-MADE PRIVATELY OWNED VEHICLE INCIDENT TO A PERMANENT CHANGE OF
STATION IS PROHIBITED EXCEPT TO OR FROM EXEMPTED OVERSEAS LOCATIONS AND
EXCEPT IN A NUMBER OF GIVEN CIRCUMSTANCES.
IN OUR DECISION IN MATTER OF KIEFER, B-188159, APRIL 1, 1977, WE HELD
THAT REIMBURSEMENT OF THE EXPENSE INCURRED SHIPPING A FOREIGN-MADE
PRIVATELY OWNED VEHICLE FROM OVERSEAS TO THE CONTINENTAL UNITED STATES
COULD NOT BE ALLOWED WHERE THE JOINT TRAVEL REGULATIONS DID NOT
AUTHORIZE SHIPMENT AT GOVERNMENT EXPENSE IN THAT SITUATION.
THIS DECISION WAS BASED IN PART ON THE FACT THAT AT THE TIME WHEN
CONSIDERATION WAS BEING GIVEN TO LIFTING THE RESTRICTION THE COMMITTEE
ON APPROPRIATIONS, HOUSE OF REPRESENTATIVES, INSISTED ON RETAINING THE
RESTRICTIONS ON SHIPPING FOREIGN-MADE HOUSEHOLD GOODS AND FOREIGN-MADE
PRIVATELY OWNED VEHICLES BECAUSE OF SLUGGISHNESS IN THE UNITED STATES
ECONOMY AND A DEFICIT IN THE BALANCE OF PAYMENTS. H.R. REPORT NO.
1389, 92D CONG., 2D SESS. 75 (1972).
THUS, THE RESTRICTION WAS INTENDED TO DISCOURAGE MEMBERS OF THE
UNIFORMED SERVICES FROM BRINGING FOREIGN-MADE VEHICLES INTO THE UNITED
STATES AT GOVERNMENT EXPENSE WHICH HAD NOT BEEN ACQUIRED THROUGH NORMAL
COMMERCE IN THE UNITED STATES.
ACCORDINGLY, LIEUTENANT LISKA'S CLAIM FOR THE EXPENSES INCURRED AND
THE LEAVE USED IN CONNECTION WITH SHIPMENT OF HIS FOREIGN-MADE PRIVATELY
OWNED VEHICLE MAY NOT BE ALLOWED. THE ACTION OF THE CLAIMS GROUP IN
DENYING HIS CLAIM IS SUSTAINED.
B-210526, JUL 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE MEMBER RETIRED IN 1965, HIS CLAIM FOR A TRAVEL AND
TRANSPORTATION ALLOWANCE TO HIS HOME OF SELECTION ACCRUED PRIOR TO OUR
DECISION IN 53 COMP.GEN. 963 (1974), WHICH WE HELD IN 54 COMP.GEN. 1042
(1975) HAS ONLY PROSPECTIVE EFFECT. THEREFORE, THE RULE EXISTING PRIOR
TO OUR DECISION IN 53 COMP.GEN. 963, THAT A MEMBER ELIGIBLE FOR HOME OF
SELECTION BENEFITS UPON RETIREMENT WHO DOES NOT ACTUALLY PERFORM TRAVEL
TO HIS HOME OF SELECTION WITHIN 1 YEAR OF RETIREMENT MAY NOT RECEIVE A
TRAVEL AND TRANSPORTATION ALLOWANCE TO HIS HOME OF SELECTION OR
ALTERNATIVELY TO HIS HOME OF RECORD OR PLACE OF ENTRY INTO ACTIVE DUTY
IS APPLICABLE. SINCE THE RECORD FAILS TO SHOW THAT THE MEMBER ACTUALLY
PERFORMED TRAVEL TO HIS HOME OF RETIREMENT WITHIN 1 YEAR OF HIS
RETIREMENT, THE MEMBER IS NOT ENTITLED TO A TRAVEL AND TRANSPORTATION
ALLOWANCE.
LIEUTENANT COLONEL JOSEPH B. REGAN:
LIEUTENANT COLONEL JOSEPH B. REGAN, USA, RETIRED, REQUESTS
RECONSIDERATION OF OUR CLAIMS GROUP'S DENIAL OF HIS CLAIM FOR A TRAVEL
AND TRANSPORTATION ALLOWANCE UPON HIS RETIREMENT TO ATLANTA, GEORGIA,
HIS HOME OF SELECTION AND THE PLACE FROM WHICH HE ENTERED ACTIVE DUTY.
THE DENIAL OF THE CLAIM IS SUSTAINED.
COLONEL REGAN RETIRED ON AUGUST 1, 1965. HE HAS CLAIMED THAT HE
PERFORMED TRAVEL TO ATLANTA FROM WASHINGTON, D. C., AND THAT HE IS
THEREFORE ENTITLED TO A TRAVEL ALLOWANCE TO ATLANTA WHICH HE HAS NOT
RECEIVED. SINCE THE RECORD DOES NOT SHOW THAT COLONEL REGAN PERFORMED
TRAVEL TO ATLANTA FOR THE PURPOSE OF ESTABLISHING A HOME WITHIN 1 YEAR
OF HIS SEPARATION ON AUGUST 1, 1966, THE CLAIM MUST BE DISALLOWED.
COLONEL REGAN'S CLAIM FOR TRAVEL EXPENSES INCIDENT TO HIS SEPARATION
WAS NOT SUBMITTED TO THE ARMY UNTIL ALMOST 10 YEARS AFTER HIS
SEPARATION. HIS CLAIM WAS FORWARDED TO OUR OFFICE FOR THE PURPOSE OF
TOLLING THE 10-YEAR STATUTE OF LIMITATIONS WHICH WAS THEN IN EFFECT.
HIS CLAIM WAS RECEIVED ON MARCH 18, 1975, JUST MONTHS BEFORE THE
EFFECTIVE DATE OF SECTION 801 OF THE GENERAL ACCOUNTING OFFICE ACT OF
1974, PUBLIC LAW 96-604, JANUARY 2, 1975, 88 STAT 1959, 1965. BY THE
TERMS OF SECTION 802 OF THAT ACT THE STATUTORY LIMITATION PERIOD WAS
REDUCED FROM 10 TO 6 YEARS EFFECTIVE JULY 2, 1975. SINCE COLONEL
REGAN'S CLAIM WAS RECEIVED PRIOR TO THE EFFECTIVE DATE OF THAT AMENDMENT
AND PRIOR TO THE EXPIRATION OF 10 YEARS FROM THE DATE THE CLAIM ACCRUED,
IT WAS CONSIDERED BY THE CLAIMS GROUP, ACCOUNTING AND FINANCIAL
MANAGEMENT DIVISION, AND DISALLOWED BY SETTLEMENT DATED AUGUST 23, 1982.
IN DENYING THE CLAIM, THE CLAIMS GROUP IN SETTLEMENT DATED AUGUST 23,
1982, STATED THAT OUR DECISION 53 COMP.GEN. 963 (1974), AS CLARIFIED BY
OUR DECISION IN 54 COMP.GEN. 1042 (1975), WAS INAPPLICABLE TO COLONEL
REGAN'S CLAIM SINCE THE DECISION WAS PROSPECTIVE ONLY AND ANY CLAIM
ARISING BEFORE JUNE 14, 1975 (THE DATE OF 53 COMP.GEN. 963) MAY NOT BE
CONSIDERED ON THE BASIS OF THE RULE ANNOUNCED IN THAT DECISION. RATHER,
THE CLAIMS GROUP HELD, THAT THE RULE EXISTING BEFORE OUR DECISION IN 53
COMP.GEN. 963, WAS APPLICABLE. UNDER THAT RULE A MEMBER QUALIFYING FOR
A TRAVEL AND TRANSPORTATION ALLOWANCE TO A HOME OF SELECTION WAS
ENTITLED TO SUCH AN ALLOWANCE ONLY IF HE ACTUALLY PERFORMED TRAVEL TO
HIS HOME OF SELECTION WITHIN A YEAR OF HIS RETIREMENT. THUS, SINCE THE
RECORD FAILED TO SHOW THAT COLONEL REGAN ACTUALLY TRAVELED TO ATLANTA
WITHIN A YEAR OF HIS RETIREMENT, HIS CLAIM WAS DENIED.
IN 53 COMP.GEN. 963, WE HELD THAT A MEMBER WHO IS ELIGIBLE FOR HOME
OF SELECTION BENEFITS BUT WHOSE CLAIM TO THE ALLOWANCE IS DENIED BECAUSE
HE FAILS TO PERFORM TRAVEL TO HIS HOME OF SELECTION WITHIN A YEAR OF HIS
RETIREMENT, SHALL BE ELIGIBLE FOR A TRAVEL AND TRANSPORTATION ALLOWANCE
TO HIS HOME OF RECORD OR THE PLACE FROM WHICH HE WAS CALLED OR ORDERED
TO ACTIVE DUTY.
MANY QUESTIONS AROSE AS A RESULT OF THE RULE LAID DOWN IN THAT
DECISION WHICH WERE ADDRESSED IN 54 COMP.GEN. 1042. WE NOTED THAT 53
COMP.GEN. 963, MODIFIED OR OVERRULED PRIOR GAO DECISIONS, AND THAT THUS
ITS EFFECT, EXCEPT IN REGARD TO THE RIGHTS OF THE CLAIMANT IN THAT
DECISION, WAS PROSPECTIVE ONLY. THEREFORE, ANY CLAIMS ACCRUING BEFORE
JUNE 14, 1974, THE DATE OF OUR DECISION IN 53 COMP.GEN. 963, MUST BE
DECIDED ON THE BASIS OF THE RULE SET DOWN IN PRIOR DECISIONS.
IN COLONEL REGAN'S CASE, SINCE HIS RETIREMENT WAS EFFECTIVE ON JULY
31, 1965, IT IS CLEAR THAT HIS CLAIM ACCRUED BEFORE JUNE 14, 1974.
THEREFORE, THE RULE IN EFFECT PRIOR TO 53 COMP.GEN. 963 IS APPLICABLE TO
HIS SITUATION.
COLONEL REGAN CLAIMS THAT HE PERFORMED TRAVEL TO ATLANTA, GEORGIA,
AND THAT HE LIVED THERE, AS HIS HOME OF SELECTION, FOR 5 YEARS. THE
QUESTION IS WHETHER HE PERFORMED THAT TRAVEL WITHIN 1 YEAR OF HIS
RETIREMENT. THE INVOICE FOR STORAGE OF HOUSEHOLD EFFECTS AND THE CHECK
IN PAYMENT THEREOF DEMONSTRATE THAT HIS HOUSEHOLD GOODS WERE IN STORAGE
IN ATLANTA DURING THE MONTHS OF AUGUST AND SEPTEMBER 1966, AND THAT
COLONEL REGAN HAD AN ACCOUNT IN A BANK IN THE ATLANTA AREA IN SEPTEMBER
1966. IN HIS POST CARD TO THE U. S. ARMY FINANCE CENTER DATED AUGUST
15, 1975, COLONEL REGAN ASSERTS THAT HE TRAVELED TO ATLANTA BUT DOES NOT
INDICATE WHEN TRAVEL TO ATLANTA FOR THE PURPOSE OF ESTABLISHING A HOME
UPON RETIREMENT WAS PERFORMED.
SINCE TRAVEL TO ATLANTA, COLONEL REGAN'S HOME OF SELECTION, WAS TO
HAVE BEEN PERFORMED WITHIN 1 YEAR OF HIS RETIREMENT DATE, AUGUST 1,
1965, AND SINCE THE EVIDENCE PRESENTED DOES NOT DEMONSTRATE THAT HE DID
TRAVEL TO ATLANTA WITHIN THAT YEAR, THE DETERMINATION OF THE CLAIMS
GROUP MUST BE SUSTAINED AND THE CLAIM DENIED.
B-210525.O.M., SEP 13, 1983
HEADNOTES-UNAVAILABLE
SUBJECT:
KELLY S. WILKERSON - CLAIM FOR REIMBURSEMENT OF
TEMPORARY STORAGE OF HOUSEHOLD GOODS
TO: ASSOCIATE DIRECTOR, AFMD - CLAIMS GROUP (ROOM 5858)
RETURNED HEREWITH IS FILE Z-2827727 FORWARDED HERE ON JANUARY 12,
1983, IN CONNECTION WITH MS. KELLY S. WILKERSON'S APPEAL OF YOUR DENIAL
OF THAT PART OF HER CLAIM WHICH DEALT WITH REIMBURSEMENT FOR THE COST OF
TEMPORARY STORAGE OF HOUSEHOLD GOODS. AS EXPLAINED BELOW, WE HAVE
DETERMINED THAT THE TEMPORARY STORAGE OF HER HOUSEHOLD GOODS WAS
INCIDENT TO HER PERMANENT CHANGE OF DUTY STATION, AND SHE IS ENTITLED TO
$47 FOR THE COST OF STORAGE FOR THE PERIOD OF FEBRUARY 20 TO APRIL 6,
1980.
WE HAVE OBTAINED ADDITIONAL INFORMATION FROM THE AGENCY THAT SHOWS
THAT PRIOR TO HER TRANSFER MS. WILKERSON WAS EMPLOYED BY THE SOCIAL
SECURITY ADMINISTRATION DISTRICT OFFICE IN EFFINGHAM, ILLINOIS. BY
TRAVEL ORDER DATED FEBRUARY 26, 1980, SHE WAS AUTHORIZED TRAVEL AND
RELOCATION EXPENSES, INCLUDING REIMBURSEMENT FOR 60 DAYS TEMPORARY
STORAGE OF HOUSEHOLD GOODS, INCIDENT TO HER PERMANENT CHANGE OF DUTY
STATION TO THE GALESBURG, ILLINOIS DISTRICT OFFICE. THE TRAVEL ORDERS
PROVIDED IN PART THAT MS. WILKERSON WOULD ATTEND TRAINING UNTIL APRIL 4,
1980, PRIOR TO REPORTING TO HER NEW OFFICIAL DUTY STATION.
MS. WILKERSON STATES THAT SHE WAS FIRST NOTIFIED OF HER PROMOTION AND
TRANSFER TO GALESBURG, ILLINOIS, ON FEBRUARY 20, 1980. SHE STATES THAT
ON THAT DATE SHE PLACED HER FURNITURE IN STORAGE UNTIL SHE FOUND
PERMANENT HOUSING AT HER NEW DUTY STATION. SHE FURTHER STATES THAT
INCIDENT TO HER PROMOTION SHE WAS REQUIRED TO ATTEND CENTRALIZED
TRAINING IN MILWAUKEE, WISCONSIN, AND THAT ON FEBRUARY 25, 1980, SHE
TRAVELED TO MILWAUKEE. SHE COMPLETED HER TRAINING AND THEN PROCEEDED TO
HER NEW DUTY STATION WHERE SHE BEGAN OCCUPANCY OF TEMPORARY QUARTERS ON
APRIL 7, 1980. MS. WILKERSON'S STATEMENT THAT SHE WAS FIRST ADVISED OF
HER TRANSFER FEBRUARY 20, 1980, IS SUPPORTED BY A COPY OF A MEMORANDUM
DATED FEBRUARY 19, 1980, FROM THE ADMINISTRATION'S REGIONAL COMMISSIONER
TO MS. WILKERSON WHEREIN SHE WAS ADVISED THAT SHE HAD BEEN SELECTED FOR
A TRAINING CLASS IN MILWAUKEE FOR THE PERIOD FEBRUARY 25 TO APRIL 4,
1980. IN THAT MEMORANDUM THE WORDS TO "GALESBURG, ILLINOIS" APPEARED
NEXT TO MS. WILKERSON'S NAME. WE HAVE BEEN INFORMALLY ADVISED BY THE
GALESBURG DISTRICT OFFICE THAT IT DOES NOT DISPUTE THE EMPLOYEE'S
CONTENTION THAT SHE WAS FIRST ADVISED OF HER TRANSFER ON FEBRUARY 20,
1980.
MS. WILKERSON SUBMITTED A CLAIM IN THE AMOUNT OF $60 REPRESENTING THE
COST OF TEMPORARY STORAGE OF 2,960 POUNDS OF HOUSEHOLD GOODS FOR THE
60-DAY PERIOD FROM FEBRUARY 20 THROUGH APRIL 19, 1980. ON JULY 19,
1980, MS. WILKERSON WAS NOTIFIED THAT HER CLAIM FOR REIMBURSEMENT OF
HOUSEHOLD GOODS WAS DISALLOWED FOR THE PERIOD FROM FEBRUARY 20 TO APRIL
6, 1980, SINCE SUCH STORAGE WAS ONLY FOR HER CONVENIENCE AND WAS NOT
INCIDENT TO HER PERMANENT CHANGE OF DUTY STATION. THUS, ONLY THAT PART
OF HER CLAIM FOR TEMPORARY STORAGE FOR THE 13-DAY PERIOD FROM APRIL 7 TO
APRIL 19, 1980, WAS ALLOWED. ON SEPTEMBER 29, 1980, THE DEPARTMENT OF
HEALTH AND HUMAN SERVICES ADVISED MS. WILKERSON THAT IT HAD DENIED HER
APPEAL OF THE DISALLOWANCE OF HER CLAIM FOR REIMBURSEMENT OF THE COST OF
TEMPORARY STORAGE OF HOUSEHOLD GOODS FOR THE PERIOD FEBRUARY 20 TO APRIL
6, 1980. SHE WAS ADVISED IN PART THAT AN EMPLOYEE AUTHORIZED AND PAID A
PER DIEM ALLOWANCE INCIDENT TO TRAINING MAY NOT ALSO BE REIMBURSED
TEMPORARY STORAGE EXPENSES INCIDENT TO THE TRAINING ASSIGNMENT. THE
AGENCY CITED AS AUTHORITY FOR ITS DENIAL OF THE APPEAL OUR DECISION IN
B-169893, JULY 29, 1970. IN THAT DECISION WE HELD THAT AN EMPLOYEE WHO
HAD BEEN PAID PER DIEM UNDER 5 U.S.C. SEC. 4109 WHILE ATTENDING A
TRAINING COURSE AWAY FROM HIS OFFICIAL DUTY STATION WAS NOT ENTITLED TO
REIMBURSEMENT FOR THE STORAGE OF HIS HOUSEHOLD GOODS. WE STATED THEREIN
THAT THE STATUTORY AUTHORITY AT 5 U.S.C. SEC. 4109 APPEARS TO
CONTEMPLATE THAT WHEN PER DIEM IS PAID, THE STORAGE OF HOUSEHOLD GOODS
IS TO BE AT THE EXPENSE OF THE EMPLOYEE.
BY SETTLEMENT DATED JUNE 10, 1980, THE CLAIMS GROUP DISALLOWED MS.
WILKERSON'S CLAIM FOR ADDITIONAL REIMBURSEMENT FOR THE TEMPORARY STORAGE
OF HOUSEHOLD GOODS. BY LETTER DATED AUGUST 16, 1983, REGION V OF THE
DEPARTMENT OF HEALTH AND HUMAN SERVICES ADVISED THAT IT REMAINS THEIR
OPINION THAT THE EMPLOYEE PLACED HER HOUSEHOLD GOODS IN TEMPORARY
STORAGE AS A CONVENIENCE INCIDENT TO THE TRAINING CLASS AND NOT BECAUSE
OF THE TRANSFER.
IN OUR DECISION B-169893, CITED ABOVE, WHICH THE AGENCY RELIED UPON
IN UPHOLDING ITS DISALLOWANCE, WE DID NOT CONSIDER THE QUESTION AS TO
WHETHER REIMBURSEMENT MAY BE ALLOWED FOR TEMPORARY STORAGE EXPENSES
DURING A PERIOD OF TRAINING WHERE SUCH COSTS ARE INCURRED IN
ANTICIPATION OF A CHANGE IN THE EMPLOYEE'S OFFICIAL DUTY STATION UPON
THE COMPLETION OF TRAINING.
REIMBURSEMENT OF RELOCATION EXPENSES INCURRED IN ANTICIPATION OF A
TRANSFER IS AUTHORIZED IF A TRAVEL ORDER IS SUBSEQUENTLY ISSUED TO THE
EMPLOYEE AUTHORIZING REIMBURSEMENT FOR SUCH EXPENSES ON THE BASIS OF A
PREVIOUSLY EXISTING ADMINISTRATIVE INTENTION TO TRANSFER HER WHICH WAS
CLEARLY EVIDENT AT THE TIME THE EXPENSES WERE INCURRED. 48 COMP.GEN.
395 (1968) AND 54 COMP.GEN. 993 (1975). IN THIS CASE IT IS UNDISPUTED
THAT THE EMPLOYEE HAD NOTICE OF HER TRANSFER TO THE GALESBURG, ILLINOIS
DISTRICT OFFICE AT THE TIME SHE PLACED HER HOUSEHOLD GOODS INTO
TEMPORARY STORAGE ON FEBRUARY 20, 1980. AS STATED ABOVE, ON FEBRUARY
26, 1980, TRAVEL ORDERS WERE ISSUED WHICH AUTHORIZED TRAVEL AND
RELOCATION EXPENSES, INCLUDING TEMPORARY STORAGE OF HOUSEHOLD GOODS, FOR
THE EMPLOYEE'S TRANSFER TO THE GALESBURG DISTRICT OFFICE. THE FACT THAT
MS. WILKERSON WAS IN TRAINING AWAY FROM HER DUTY STATION PRIOR TO THE
TRANSFER WOULD NOT ADVERSELY AFFECT HER ENTITLEMENT TO REIMBURSEMENT FOR
TEMPORARY STORAGE EXPENSES. SEE MATTER OF WILLIS, ET AL., 59 COMP.GEN.
619 AT 622 (1980), WHERE REIMBURSEMENT OF COSTS INCURRED FOR TEMPORARY
STORAGE OF HOUSEHOLD GOODS WAS ALLOWED WHERE IT WAS KNOWN IN ADVANCE OF
THE EMPLOYEE'S TRAINING ASSIGNMENT AWAY FROM HER OFFICIAL DUTY STATION
THAT SHE WAS TO BE TRANSFERRED UPON THE COMPLETION OF TRAINING. ALSO,
SEE B-161795, JUNE 29, 1967.
IN ACCORDANCE WITH THE ABOVE, THE CLAIM FOR TEMPORARY STORAGE OF
HOUSEHOLD GOODS IS PROPERLY FOR ALLOWANCE AS AN EXPENSE INCURRED
INCIDENT TO A PERMANENT CHANGE OF DUTY STATION. THUS, SETTLEMENT SHOULD
ISSUE IN FAVOR OF MS. WILKERSON IN THE ADDITIONAL AMOUNT OF $47 FOR THE
COST OF TEMPORARY STORAGE OF HOUSEHOLD GOODS FOR THE PERIOD FEBRUARY 20
TO APRIL 6, 1980.
B-210524, JUN 6, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE AN EMPLOYEE'S CLAIM FOR SEVERANCE PAY BY REASON OF INVOLUNTARY
SEPARATION IS BASED UPON THE CONTENTION THAT HER POSITION WAS MOVED TO
ANOTHER COMMUTING AREA, THE EMPLOYEE MUST ALSO ESTABLISH THAT SHE WAS
FORCED TO RELOCATE HER RESIDENCE BECAUSE OF THAT CHANGE IN COMMUTING
AREAS. WE WILL NOT QUESTION AN AGENCY'S DETERMINATION ON COMMUTING AREA
OR NECESSITY OF RELOCATION UNLESS THAT DETERMINATION IS ARBITRARY,
CAPRICIOUS, OR CLEARLY ERRONEOUS. HERE, CLAIMANT COULD NOT ESTABLISH TO
THE SATISFACTION OF THE AGENCY THAT THE CHANGE WOULD COMPEL THE EMPLOYEE
TO CHANGE HER RESIDENCE TO CONTINUE EMPLOYMENT. WE CANNOT SAY THAT THE
AGENCY'S DETERMINATION WAS ARBITRARY, CAPRICIOUS, OR CLEARLY ERRONEOUS.
HENCE, CLAIMANT'S RESIGNATION WAS NOT INVOLUNTARY, AND HER CLAIM FOR
SEVERANCE PAY IS DENIED.
VIVIAN W. SPENCER - SEVERANCE PAY:
VIVIAN W. SPENCER REQUESTS RECONSIDERATION OF SETTLEMENT CERTIFICATE,
Z-2844073, AUGUST 20, 1982, ISSUED BY OUR CLAIMS GROUP, DENYING HER
CLAIM FOR SEVERANCE PAY. FOR THE REASONS SET FORTH BELOW, WE AFFIRM
THAT ACTION.
MRS. SPENCER WAS AN EMPLOYEE OF THE BUREAU OF MINES, DEPARTMENT OF
THE INTERIOR (DEPARTMENT), AT ITS MORGANTOWN, WEST VIRGINIA FACILITY.
IN SEPTEMBER 1981 THAT FUNCTION WAS TRANSFERRED TO LAKE LYNN,
PENNSYLVANIA. MRS. SPENCER REFUSED TO ACCOMPANY THE TRANSFER AND
RESIGNED, CLAIMING THAT HER RESIGNATION WAS AN INVOLUNTARY SEPARATION
BECAUSE LAKE LYNN WAS OUTSIDE THE MORGANTOWN COMMUTING AREA. HER CLAIM
WAS PREDICATED UPON BOTH 5 U.S.C. SEC. 5595(B) AND 5 C.F.R. SEC.
550.705. UNDER 5 U.S.C. SEC. 5595(B) SEVERANCE PAY IS PAYABLE TO AN
EMPLOYEE WHO, "IS INVOLUNTARILY SEPARATED FROM THE SERVICE, NOT BY
REMOVAL FOR CAUSE ***." THE STATUTE IS IMPLEMENTED BY 5 C.F.R. SEC.
550.705 WHICH PROVIDES THAT:
"WHEN AN EMPLOYEE IS SEPARATED BECAUSE HE
DECLINES TO ACCEPT ASSIGNMENT TO ANOTHER
COMMUTING AREA, THE SEPARATION IS AN INVOLUNTARY
SEPARATION (NOT FOR CAUSE) ***".
AFTER AN INITIAL DENIAL OF HER CLAIM, MRS. SPENCER PURSUED HER RIGHTS
OF APPEAL WITHIN THE DEPARTMENT. A GRIEVANCE EXAMINER FOR THE
DEPARTMENT'S OFFICE OF HEARINGS AND APPEALS FOUND, IN HIS RECOMMENDED
DECISION, THAT LAKE LYNN WAS OUTSIDE THE MORGANTOWN COMMUTING AREA, BUT
THIS DETERMINATION WAS REJECTED BY THE CHIEF, PITTSBURGH/BRUCETON
ADMINISTRATIVE OFFICE OF THE BUREAU OF MINES. IN HIS APRIL 26, 1982,
FINAL DETERMINATION, THE DEPARTMENT'S DIRECTOR OF PERSONNEL DID NOT
SPECIFICALLY MAKE ANY DETERMINATION AS TO COMMUTING AREA, BUT STATED
THAT EVEN IF THE GRIEVANCE EXAMINER'S FINDING THAT THERE HAD BEEN A
CHANGE IN COMMUTING AREA WAS ACCEPTED, THERE WAS LITTLE EVIDENCE TO
SUPPORT A FINDING THAT MRS. SPENCER WAS COMPELLED TO MOVE IN ACCORDANCE
WITH THE TRANSFER. SUCH A FINDING IS A PREREQUISITE TO ENTITLEMENT TO
SEVERANCE PAY UNDER 5 C.F.R SEC. 550.705. UPON APPEAL TO OUR CLAIMS
GROUP, MRS. SPENCER'S CLAIM FOR SEVERANCE PAY WAS DENIED ON
SUBSTANTIALLY THE SAME GROUNDS. THE MATTER IS NOW BEFORE US ON
RECONSIDERATION.
WE HELD IN MARSHALL S. HELLMANN, B-182300, JANUARY 16, 1975, AFFIRMED
ON RECONSIDERATION, DECEMBER 4, 1975, THAT A DETERMINATION REGARDING
COMMUTING AREA WAS THE RESPONSIBILITY OF THE CIVIL SERVICE COMMISSION
(NOW THE OFFICE OF PERSONNEL MANAGEMENT) AND THE AGENCY CONCERNED, AND
THAT A DETERMINATION THAT THERE HAD BEEN NO CHANGE IN COMMUTING AREA
NEGATED ANY CLAIM FOR SEVERANCE PAY BY REASON OF INVOLUNTARY SEPARATION.
FURTHER, EVEN IF A CHANGE IN COMMUTING AREA HAD OCCURRED, AN
INVOLUNTARY SEPARATION COULD BE ESTABLISHED ONLY ON A CASE-BY-CASE BASIS
WHEN IT COULD BE SHOWN THAT THE EMPLOYEE WAS COMPELLED TO MOVE IN ORDER
TO CONTINUE EMPLOYMENT WITH THE AGENCY. WE WILL NOT QUESTION EITHER OF
THE AGENCY'S DETERMINATIONS UNLESS THEY ARE SHOWN TO BE ARBITRARY,
CAPRICIOUS, OR CLEARLY ERRONEOUS.
IN THE FIRST HELLMANN DECISION, WE SET OUT THE FACTORS TO BE
CONSIDERED IN DETERMINING WHETHER AN EMPLOYEE WAS COMPELLED TO CHANGE
HIS RESIDENCE. THOSE FACTORS ARE:
"*** (1) INCREASED DISTANCE FROM HOME TO
THE NEW LOCATION, (2) INCREASED TIME AND COST
OF TRAVEL, AND (3) AVAILABILITY OF
TRANSPORTATION. ***"
APPLYING THE ABOVE FACTORS IN THIS CASE, THE DISTANCE BETWEEN THE NEW
AND OLD WORKSITES IS APPROXIMATELY 17-20 MILES, REPRESENTING AN
APPROXIMATE TRAVEL TIME OF 30-40 MINUTES. A MAJOR PORTION OF THE TRIP
IS BY A DIVIDED FOUR-LANE HIGHWAY, THE REMAINDER ON A SECONDARY STATE
ROAD. ALTHOUGH MRS. SPENCER CONTENDS THAT THE SECONDARY ROAD IS
INADEQUATE AND HAZARDOUS, THE RECORD INDICATES THAT IT IS TYPICAL OF
SECONDARY ROADS IN THE AREA. HOWEVER, THE CENTRAL ISSUE, AS RAISED IN
THE GRIEVANCE EXAMINER'S REPORT, CONCERNS THE ACCESS ROAD FROM THE
SECONDARY ROAD TO THE NEW WORKSITE. IT IS DESCRIBED AS WIDE, BUT RISING
SHARPLY, UNPAVED, AND, "EXCEEDINGLY RUTTED AND ROCKY OVER ITS ENTIRE
LENGTH." IT IS APPROXIMATELY 2.5 MILES IN LENGTH, AND REQUIRES A TRAVEL
TIME OF 10 MINUTES AT A MAXIMUM SPEED OF 15 MILES PER HOUR IN ORDER TO
BE NEGOTIATED. THERE ARE INDICATIONS THAT DAILY TRAVEL ON THIS ROAD
COULD CAUSE SUBSTANTIAL WEAR AND TEAR ON A NORMAL PASSENGER CAR, AND
THAT THE ROAD MAY BECOME IMPASSABLE, EXCEPT TO FOUR-WHEEL DRIVE
VEHICLES, IN INCLEMENT WEATHER. MANAGEMENT AT THE NEW WORKSITE HAS
OFFERED TO CONVEY EMPLOYEES UP THE ACCESS ROAD BY FOUR-WHEEL DRIVE
VEHICLE DURING THE WINTER MONTHS. MRS. SPENCER CONTENDS THAT THIS
MEASURE IS INADEQUATE.
IF IT IS CONCLUDED, HYPOTHETICALLY, THAT THE LAKE LYNN FACILITY IS
BEYOND THE MORGANTOWN COMMUTING AREA, MRS. SPENCER CAN ONLY BE DEEMED
INVOLUNTARILY SEPARATED IF SHE WOULD HAVE BEEN COMPELLED TO MOVE IN
ORDER TO ASSUME HER NEW DUTIES. HOWEVER, THE AGENCY CONCLUDED THAT THE
FACTS DO NOT SUPPORT SUCH A FINDING. ALTHOUGH WE FULLY ACCEPT MRS.
SPENCER'S CONTENTION THAT SHE WAS WITHOUT EFFECTIVE PUBLIC
TRANSPORTATION AND THAT SHE WOULD HAVE HAD TO SECURE PRIVATE
TRANSPORTATION, WE CANNOT FIND THAT THE DIFFICULTIES ASSOCIATED WITH THE
ACCESS ROAD, THE TRAVEL TIME OF 30-40 MINUTES, AND COMMUTING DISTANCE OF
17-20 MILES, CONSTITUTE REASONS COMPELLING ENOUGH TO HAVE FORCED HER TO
RELOCATE. THUS, ALTHOUGH MRS. SPENCER'S ROUTE TO THE NEW WORKSITE MAY
HAVE BEEN INCONVENIENT, IT WAS NOT SO INADEQUATE AS TO JUSTIFY A FINDING
OF A FORCED RELOCATION AND CONSEQUENT INVOLUNTARY SEPARATION, AND WE
CANNOT SAY THAT THE AGENCY'S DETERMINATION THAT SHE WAS NOT REQUIRED TO
RELOCATE WAS ARBITRARY, CAPRICIOUS, OR CLEARLY ERRONEOUS.
ACCORDINGLY, WE DENY MRS. SPENCER'S CLAIM FOR SEVERANCE PAY UPON
RECONSIDERATION AND AFFIRM THE AUGUST 20, 1982, SETTLEMENT ACTION OF OUR
CLAIMS GROUP.
B-210522, DEC 15, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. CLAIM BY MEDICAL DOCTOR EMPLOYED BY EPA FOR REIMBURSEMENT OF
REGISTRATION FEE AND PER DIEM EXPENSES INCURRED INCIDENT TO HIS
ATTENDANCE AT NEVADA ACADEMY OF FAMILY PHYSICIAN'S MEETING IS
GOVERNED BY THE PROHIBITION OF 5 U.S.C. SEC. 5946 AGAINST SUCH
PAYMENT AND MAY NOT BE ALLOWED ABSENT EVIDENCE THAT HIS ATTENDANCE
WAS PART OF AN AUTHORIZED TRAINING PROGRAM UNDER 5 U. S.C. SEC.
4109, OR THAT IT WAS RELATED TO AGENCY FUNCTIONS OR MANAGEMENT
UNDER 5 U.S.C. SEC. 4110. IN THE ABSENCE OF SUCH EVIDENCE ANNUAL
LEAVE SHOULD BE CHARGED SINCE THE EMPLOYEE'S TRAVEL CANNOT BE
CONSIDERED OFFICIAL TRAVEL.
2. EMPLOYEE CONTENDS THAT HE SHOULD
BE REIMBURSED FOR EXPENSES INCURRED INCIDENT TO ATTENDANCE AT THE
NEVADA ACADEMY OF FAMILY PHYSICIAN'S MEETING BECAUSE IT PROVIDED
HIM WITH 20 HOURS OF CONTINUING MEDICAL EDUCATION HE NEEDS TO
RETAIN HIS MEDICAL LICENSE AND BOARD CERTIFICATION, WHICH HE IN
TURN NEEDS TO RETAIN HIS EPA POSITION. THE CLAIM IS DENIED SINCE
THE EXPENSES ARE PERSONAL IN NATURE, AND WITHIN THE PURVIEW OF
THOSE CASES WHERE WE HAVE HELD THAT IT IS THE DUTY OF AN EMPLOYEE
TO QUALIFY HIMSELF FOR THE PERFORMANCE OF HIS OFFICIAL DUTIES.
DR. M. E. KAYE - REIMBURSEMENT OF REGISTRATION FEE AND PER DIEM
EXPENSES:
MR. JOHN J. SANDY, ACTING DIRECTOR, FINANCIAL MANAGEMENT DIVISION,
ENVIRONMENTAL PROTECTION AGENCY (EPA), HAS REFERRED THE CLAIM OF DR. M.
E. KAYE TO US FOR DECISION. AT ISSUE IS DR. KAYE'S ENTITLEMENT TO
REIMBURSEMENT OF A REGISTRATION FEE AND PER DIEM EXPENSES HE INCURRED IN
CONNECTION WITH HIS ATTENDANCE AT THE ANNUAL MEETING OF THE NEVADA
ACADEMY OF FAMILY PHYSICIANS. ALSO AT ISSUE IS WHETHER DR. KAYE'S SHOULD
HAVE BEEN CHARGED ANNUAL LEAVE.
BACKGROUND
DR. KAYE, WHOSE PERMANENT DUTY STATION IS LAS VEGAS, NEVADA, ATTENDED
THE NEVADA ACADEMY OF FAMILY PHYSICIAN'S 14TH ANNUAL SKI-CME MEETING
FROM JANUARY 24, 1982, TO JANUARY 29, 1982, IN LAKE TAHOE, NEVADA. HE
DID SO PURSUANT TO A TRAVEL AUTHORIZATION GRANTING HIM PER DIEM. UPON
HIS RETURN DR. KAYE SUBMITTED A VOUCHER FOR REIMBURSEMENT OF $657.50, OF
WHICH $370 WAS DISALLOWED. OF THIS AMOUNT, $325 REPRESENTED THE
REGISTRATION FEE AND $45 REPRESENTED A PORTION OF THE PER DIEM CLAIMED.
THE LAS VEGAS FINANCE OFFICE DISALLOWED DR. KAYE'S CLAIM FOR
REIMBURSEMENT OF THE REGISTRATION FEE BECAUSE IT INCLUDED SOCIAL
ACTIVITIES AND MEALS FOR DR. KAYE AND HIS WIFE THAT COULD NOT BE
SEPARATED OUT OR PRICED ON AN ITEM-BY-ITEM BASIS. THE $45 WAS DEDUCTED
FROM DR. KAYE'S CLAIM DUE TO A REDUCTION IN HIS PER DIEM ENTITLEMENT
FROM 7-1/2 TO 5-3/4 DAYS, BASED ON A DISALLOWANCE OF THE EXCESS TIME HE
SPENT DRIVING INSTEAD OF FLYING.
DR. KAYE CONTENDS THAT HE IS ENTITLED TO REIMBURSEMENT OF THE
REGISTRATION FEE BECAUSE THE SPECIFIC PURPOSE FOR HIS ATTENDANCE AT THE
MEETING WAS TO EARN A PORTION OF THE CONTINUING MEDICAL EDUCATION HOURS
HE NEEDS TO RETAIN HIS MEDICAL LICENSE AND BOARD CERTIFICATION, AND TO
MAINTAIN HIS POSITION WITH EPA AS A MEDICAL ADVISOR. ALTHOUGH DR. KAYE
HAS CONCURRED IN THE REDUCTION OF HIS PER DIEM CLAIM, MR. SANDY HAS
ASKED WHETHER ALL OF THE PER DIEM SHOULD HAVE BEEN DISALLOWED IN LIGHT
OF THE PURPOSE FOR WHICH DR. KAYE ATTENDED THE MEETING. FOR REASONS WE
WILL EXPLAIN BELOW IT APPEARS THAT EPA'S DISALLOWANCE OF THE
REGISTRATION FEE WAS PROPER AND THAT PER DIEM SHOULD NOT HAVE BEEN
AUTHORIZED.
OPINION
ATTENDANCE AT MEETINGS
THE GENERAL RULE REGARDING EXPENSES OF THIS NATURE IS FOUND IN
SECTION 5946 OF TITLE 5, UNITED STATES CODE, WHICH PROVIDES THAT:
"EXCEPT AS AUTHORIZED BY A SPECIFIC
APPROPRIATION, BY EXPRESS TERMS IN A GENERAL
APPROPRIATION, OR BY SECTIONS 4109 AND 4110
OF THIS TITLE, APPROPRIATED FUNDS MAY NOT
BE USED FOR PAYMENT OF -
* * * * *
"(2) EXPENSES OF ATTENDANCE OF AN
INDIVIDUAL AT MEETINGS OR CONVENTIONS OF
MEMBERS OF A SOCIETY OR ASSOCIATION."
SECTION 4109 OF TITLE 5 AUTHORIZES THE HEAD OF AN AGENCY TO REIMBURSE
THE NECESSARY EXPENSES OF AN EMPLOYEE SELECTED FOR TRAINING PURSUANT TO
AN AUTHORIZED TRAINING PROGRAM, BUT THERE IS NO INDICATION THAT DR.
KAYE'S ATTENDANCE AT THE MEETING OF THE NEVADA ACADEMY OF FAMILY
PHYSICIANS WAS PURSUANT TO AN AUTHORIZED TRAINING PROGRAM. NOR ARE WE
AWARE OF ANY APPROPRIATION WHICH PROVIDES FOR REIMBURSEMENT OF THESE
EXPENSES. THEREFORE, IN ORDER FOR DR. KAYE TO BE REIMBURSED, HIS
ATTENDANCE MUST BE DETERMINED TO FALL WITHIN THE EXCEPTION TO THE
GENERAL RULE AGAINST SUCH REIMBURSEMENT FOUND IN SECTION 4110.
SECTION 4110 PROVIDES THAT:
"APPROPRIATIONS AVAILABLE TO AN AGENCY
FOR TRAVEL EXPENSES ARE AVAILABLE FOR
EXPENSES OF ATTENDANCE AT MEETINGS WHICH
ARE CONCERNED WITH THE FUNCTIONS OR
ACTIVITIES FOR WHICH THE APPROPRIATION IS
MADE OR WHICH WILL CONTRIBUTE TO IMPROVED
CONDUCT, SUPERVISION, OR MANAGEMENT OF THE
FUNCTIONS OR ACTIVITIES."
IN HIS LETTER FORWARDING DR. KAYE'S CLAIM, MR. SANDY DOES NOT ASSERT
THAT THE MEETING DR. KAYE ATTENDED HAD ANY APPLICATION TO EPA'S
FUNCTIONS OR ACTIVITIES, NOR DOES HE ASSERT THAT DR. KAYE'S ATTENDANCE
RESULTED IN THE IMPROVED CONDUCT, SUPERVISION, OR MANAGEMENT OF EPA'S
FUNCTIONS OR ACTIVITIES.
IT DOES NOT APPEAR THAT EPA MADE A DETERMINATION THAT THE MEETING OF
THE NEVADA ACADEMY OF FAMILY PHYSICIANS WAS RELATED TO AGENCY FUNCTIONS
OR MANAGEMENT AS REQUIRED UNDER 5 U.S.C. SEC. 4110, PRIOR TO AUTHORIZING
DR. KAYE'S TRAVEL. SINCE WE HAVE NO INFORMATION REGARDING DR. KAYE'S
DUTIES AT EPA, WE CANNOT MAKE AN INDEPENDENT DETERMINATION THAT THE
MEETING HE ATTENDED WAS RELATED TO EPA'S FUNCTIONS OR MANAGEMENT.
AS A RESULT, IN THE ABSENCE OF ANY INDICATION THAT ONE OF THE
EXCEPTIONS TO 5 U.S.C. SEC. 5946 APPLIES, THE PROHIBITION OF THAT
SECTION AGAINST REIMBURSEMENT OF AN INDIVIDUAL'S ATTENDANCE AT MEETINGS
OF A SOCIETY OR ASSOCIATION GOVERNS THIS SITUATION AND PRECLUDES
REIMBURSEMENT TO DR. KAYE OF THE REGISTRATION FEE AND PER DIEM EXPENSES.
OFFICIAL TRAVEL/ANNUAL LEAVE
PRIOR TO DENYING DR. KAYE'S CLAIM FOR REIMBURSEMENT OF THE
REGISTRATION FEE, THE EPA LAS VEGAS OFFICE CONTACTED THE FISCAL POLICIES
AND PROCEDURES BRANCH IN WASHINGTON FOR ADVICE. IN ADDITION TO ADVISING
THE LAS VEGAS OFFICE THAT THE REGISTRATION FEE WAS NOT REIMBURSABLE, THE
FISCAL POLICIES AND PROCEDURES BRANCH STATED:
"IT IS OUR BELIEF THAT THE 14TH ANNUAL SKI-CME
MEETING WAS NOT FOR THE BENEFIT OF THE
AGENCY AND WE MUST HOLD, UNDER CURRENT FINDINGS,
THAT THE FEE IS NOT REIMBURSABLE. ***
* * * * *
"WE ALSO HAVE TO QUESTION THE LEGALITY OR NEED
FOR AN EPA EMPLOYEE TO ATTEND THIS MEETING ON
OFFICIAL BUSINESS AND BELIEVE IT SHOULD HAVE
BEEN AT PERSONAL EXPENSE AND A CHARGE TO THEIR
ANNUAL LEAVE."
IF NO DETERMINATION IS MADE THAT DR. KAYE'S ATTENDANCE AT THIS
MEETING FALLS WITHIN THE CONFINES OF 5 U.S.C. SEC. 4110, WE WOULD AGREE
WITH THE EPA FISCAL POLICIES AND PROCEDURES BRANCH THAT DR. KAYE'S
TRAVEL CANNOT BE CONSIDERED OFFICIAL TRAVEL AND HE SHOULD BE CHARGED
ANNUAL LEAVE.
STATE LICENSE/BOARD CERTIFICATION
DR. KAYE CONTENDS THAT HE SHOULD BE REIMBURSED FOR THE REGISTRATION
FEE BECAUSE TO RETAIN HIS POSITION AT EPA HE NEEDS A STATE LICENSE AND
BOARD CERTIFICATION AND TO RETAIN THOSE, HE NEEDS A CERTAIN NUMBER OF
CONTINUING MEDICAL EDUCATION HOURS, 20 OF WHICH HE EARNED BY ATTENDING
THE NEVADA ACADEMY OF FAMILY PHYSICIANS MEETING. ASSUMING THAT DR. KAYE
DOES NEED A STATE LICENSE AND BOARD CERTIFICATION TO RETAIN HIS POSITION
AT EPA, HIS CLAIM FALLS WITHIN THE PURVIEW OF THOSE CASES IN WHICH WE
HAVE HELD THAT IT IS THE DUTY OF AN OFFICER OR EMPLOYEE OF THE UNITED
STATES TO QUALIFY HIMSELF FOR THE PERFORMANCE OF HIS OFFICIAL DUTIES.
IN ACCORDANCE WITH THIS RULE, WE HAVE HELD THAT APPROPRIATED FUNDS
CANNOT BE USED TO PAY THE EXPENSES OF A FEDERAL ATTORNEY INCIDENT TO
MAINTAINING HIS STATUS AS AN ATTORNEY IN GOOD STANDING IN A STATE BAR.
SEE 51 COMP.GEN. 701 (1972); B-204215, DECEMBER 28, 1981. WE HAVE ALSO
HELD THAT THIS PROHIBITION EXTENDS TO PRECLUDE THE REIMBURSEMENT OF FEES
REQUIRED TO PRACTICE BEFORE A PARTICULAR COURT. SEE 47 COMP. GEN. 116
(1967). WHILE ALL FEDERAL ATTORNEYS ARE REQUIRED TO MAINTAIN MEMBERSHIP
IN A STATE BAR AND MANY MUST BE ADMITTED TO PRACTICE BEFORE A PARTICULAR
COURT IN ORDER TO REPRESENT THE GOVERNMENT'S INTEREST BEFORE THAT COURT,
WE CONSIDER THESE EXPENSES TO BE MATTERS OF PERSONAL QUALIFICATION. IN
B-204021, APRIL 16, 1982, 61 COMP.GEN. 357, WE HELD THAT THE MERIT
SYSTEMS PROTECTION BOARD COULD NOT REIMBURSE APPEALS OFFICERS FOR LAW
SCHOOL TUITION AND BAR REVIEW COURSE TUITION INCIDENT TO A PROGRAM TO
ASSIST THEM IN MEETING A NEW REQUIREMENT THAT THEY BE BAR-ADMITTED
ATTORNEYS. WE POINTED OUT, AS WE HAD WITH REGARD TO COURT ADMISSION
FEES AND BAR MEMBERSHIP FEES, THAT THOSE EXPENSES WHICH ENABLE OR ASSIST
THE INDIVIDUAL TO QUALIFY FOR A POSITION ARE PERSONAL TO THE EMPLOYEE
AND APPROPRIATED FUNDS CANNOT BE USED TO PAY FOR THEM.
WE HAVE APPLIED THE SAME RULE WHERE A FEDERAL EMPLOYEE MUST SECURE A
PERMIT OR LICENSE TO PERFORM THE DUTIES OF HIS POSITION. THUS, IN
B-186512, JANUARY 17, 1977, WE HELD THAT APPROPRIATIONS OF THE U.S.
FOREST SERVICE WERE NOT AVAILABLE TO REIMBURSE AN EMPLOYEE WHO WAS
REQUIRED TO PURCHASE A STATE PESTICIDE APPLICATOR LICENSE, AND IN
B-193862, APRIL 30, 1979, WE HELD THAT THE NATIONAL PARK SERVICE COULD
NOT REIMBURSE ITS EMPLOYEES FOR THE COST OF STATE CERTIFICATION AS WATER
TREATMENT OPERATORS. IN 46 COMP.GEN. 695 (1967), WE HELD THAT THE STATE
LICENSE FEES IMPOSED ON MEDICAL DOCTORS EMPLOYED BY THE PUBLIC HEALTH
SERVICE, WHO ARE DETAILED TO STATES OR LOCAL HEALTH AGENCIES, COULD NOT
BE REIMBURSED TO THOSE EMPLOYEES EVEN THOUGH THEY WERE DETAILED TO CARRY
OUT STATE FUNCTIONS.
IN SUMMARY, WITHOUT EVIDENCE THAT THIS SITUATION FALLS WITHIN AN
EXCEPTION TO THE PROHIBITION OF 5 U.S.C. SEC. 5946 AND GIVEN ITS
SIMILARITY TO THE CASES CITED ABOVE, WE HOLD THAT DR. KAYE MAY NOT BE
REIMBURSED FOR THE EXPENSES HE INCURRED INCIDENT TO ATTENDING THE NEVADA
ACADEMY OF PHYSICIAN'S MEETING AND THAT THIS TRAVELTIME IS CHARGEABLE TO
ANNUAL LEAVE.
B-210520; B-210520.2; B-210520.3, JUL 26, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST AGAINST USE OF BROAD CATEGORIES IN A
MULTIPLE-AWARD FEDERAL SUPPLY SCHEDULE SOLICITATION IS UNTIMELY
WHEN FILED AFTER CLOSING DATE FOR RECEIPT OF PROPOSALS.
2. SMALL BUSINESS SIZE AND SIZE STANDARDS ARE
DETERMINED BY THE SMALL BUSINESS ADMINISTRATION, NOT GAO.
3. CLAIM THAT A SMALL BUSINESS SET-ASIDE WILL
INJURE A LARGE BUSINESS' SMALL BUSINESS SUPPLIERS IS WITHOUT LEGAL
MERIT WHERE THE PROPRIETY OF THE SET-ASIDE HAS BEEN ESTABLISHED.
4. PROTEST AGAINST A SMALL BUSINESS SET-ASIDE FOR
CERTAIN FEDERAL SUPPLY SCHEDULE ITEMS ON THE GROUND THAT IT
CREATES A SOLE-SOURCE PROCUREMENT IS DENIED WHEN THE CONTRACTING
AGENCY'S DECISION TO SET ASIDE IS BASED ON SUBSTANTIAL NUMBER AND
DOLLAR VOLUME OF PREVIOUS SMALL BUSINESS CONTRACTS AWARDED ON
UNRESTRICTED BASIS AND SMALL BUSINESS INTEREST IN INSTANT
PROCUREMENT.
5. PROTEST AGAINST THE USE OF BROAD CATEGORIES
IN A FEDERAL SUPPLY SCHEDULE SOLICITATION IS DENIED WHEN THE
PROTESTER DOES NOT SHOW THAT THE GOVERNMENT HAD NO REASONABLE
EXPECTATION OF RECEIVING COMPETITION FOR ALL NEEDED VARIETIES OF
THE BROADLY DESCRIBED ITEM.
6. PROTEST AGAINST REORGANIZATION OF SPECIAL
ITEM NUMBERS FOR A FEDERAL SUPPLY SCHEDULE SOLICITATION FILED
AFTER THE CLOSING DATE FOR PROPOSALS IS UNTIMELY.
7. PROTEST AGAINST A SMALL BUSINESS SET-ASIDE IS
DENIED WHEN A REVIEW OF THE PROPOSALS RECEIVED UNDER THE SET-ASIDE
REVEALS THAT SUBSTANTIAL NUMBER OF QUALIFIED FIRMS HAVE OFFERED A
VARIETY OF TECHNICALLY ACCEPTABLE EQUIPMENT AT REASONABLE PRICES.
DATAMETRICS, DRESSER INDUSTRIES, INC.; HUGHES AIRCRAFT CO.; LINEAR
LABORATORIES:
DATAMETRICS, DRESSER INDUSTRIES, INC. (DATAMETRICS), PROTESTS THE
TOTAL SMALL BUSINESS SET-ASIDE FOR VARIOUS TRANSDUCERS IN REQUEST FOR
PROPOSALS (RFP) NO. YGS-F-36406-N-2-11-83 ISSUED BY THE GENERAL SERVICES
ADMINISTRATION (GSA) FOR MULTIPLE-AWARD FEDERAL SUPPLY SCHEDULE (FSS)
CONTRACTS. HUGHES AIRCRAFT CO. (HUGHES) AND LINEAR LABORATORIES (LINEAR)
PROTEST THE TOTAL SET-ASIDE FOR "SYSTEMS THAT MEASURE HEAT ENERGY" ON
THE SAME RFP.
FEDERAL PROCUREMENT REGULATIONS (FPR) SEC. 1-1.706-5(A) (1964 ED.,
AMEND. 192) PROVIDES THAT AGENCIES MAY USE A TOTAL SMALL BUSINESS
SET-ASIDE ON ITEMS FOR WHICH THE AGENCY CAN REASONABLY EXPECT A
SUFFICIENT NUMBER OF COMPETITIVELY PRICED PROPOSALS FROM RESPONSIBLE
SMALL BUSINESS FIRMS. ALL THREE PROTESTS HAVE BEEN EVALUATED AGAINST
THIS STANDARD, AND WE FIND THE SET-ASIDES WERE PROPER.
WE DISMISS THE PROTESTS IN PART AND DENY THE PROTESTS IN PART.
THE DATAMETRICS PROTEST
DATAMETRICS CLAIMS THAT THE FIVE CATEGORIES OF TRANSDUCERS USED IN
THE RFP ARE OVERLY BROAD AND DO NOT REFLECT THE NEEDS OF THE GOVERNMENT,
THAT DATAMETRICS SHOULD BE CONSIDERED A SMALL BUSINESS, THAT MKS, A
COMPETITOR OF DATAMETRICS, SHOULD BE CLASSIFIED AS A LARGE BUSINESS,
THAT A SET-ASIDE WILL INJURE DATAMETRICS' SMALL BUSINESS SUPPLIERS, THAT
THE SMALL BUSINESS SET-ASIDE WILL CREATE A SOLE-SOURCE PROCUREMENT FOR
MKS WHICH IS DOMINANT IN THE FIELD WITH REGARD TO CERTAIN TYPES OF
TRANSDUCERS, AND THAT DATAMETRICS' PRODUCTS ARE UNIQUE AND CANNOT BE
MATCHED BY SMALL BUSINESS PRODUCTS.
THIS OFFICE HAS RECEIVED COMMENTS CONCERNING THIS PROTEST FROM
SEVERAL FIRMS, INCLUDING FIVE SMALL BUSINESSES. ONE OF THESE INTERESTED
PARTIES, ROSEMOUNT, INC. (ROSEMOUNT), INITIALLY RAISED THE ISSUE, WHICH
THE PROTESTER LATER ADOPTED, THAT THE CATEGORIES OF TRANSDUCERS WERE TOO
BROAD. INASMUCH AS THIS ALLEGED APPARENT SOLICITATION IMPROPRIETY WAS
NOT RAISED IN DATAMETRICS' INITIAL PROTEST, ROSEMOUNT'S LETTER WAS NOT
ADDRESSED TO THIS OFFICE AS A PROTEST, AND THE SUPPLEMENTAL DATAMETRICS
LETTER WHICH RAISED THE ISSUE WAS RECEIVED AFTER THE CLOSING DATE FOR
PROPOSALS, THE ISSUE IS UNTIMELY. 4 C.F.R SEC. 21.2( B)(1) (1983).
AS FOR THE SMALL BUSINESS STATUS OF DATAMETRICS AND MKS AND SMALL
BUSINESS SIZE STANDARDS, THE SMALL BUSINESS ADMINISTRATION (SBA)
DETERMINES THESE MATTERS, NOT GAO. THEREFORE, WE DISMISS THIS ASPECT OF
THE PROTEST. TELEX COMMUNICATIONS, INC., B-208382, AUGUST 17, 1982,
82-2 CPD 142; PACIFIC DIVING INDUSTRIES, INC., B-195405, AUGUST 1,
1979, 79-2 CPD 72.
WITH RESPECT TO THE DATAMETRICS CLAIM THAT THE SET-ASIDE WILL RESULT
IN A SOLE-SOURCE PROCUREMENT BECAUSE ONLY THE PROTESTER AND MKS OFFER
THE UNIQUE TRANSDUCERS REQUIRED, A NUMBER OF FACTORS CAN BE EVALUATED TO
DETERMINE WHETHER THE AGENCY HAD A REASONABLE EXPECTATION OF ADEQUATE
COMPETITION, INCLUDING THE NUMBER AND DOLLAR-VALUE PERCENTAGE OF SMALL
BUSINESS CONTRACTS AWARDED IN PRIOR YEARS AND THE NUMBER OF SMALL
BUSINESS COMMENTS RECEIVED CONCERNING THE PROTEST. BELL & HOWELL;
TOPPER MANUFACTURING CORPORATION, 61 COMP.GEN. 596 (1982), 82-2 CPD 224;
REPUBLIC STEEL CORPORATION; PENCO PRODUCTS, INC. B-205951;
B-205951.2, APRIL 29, 1982, 82-1 CPD 399. ONLY THE PROTESTER CLAIMS
THAT MKS IS DOMINANT IN THE FIELD AND WILL ENJOY SOLE-SOURCE STATUS FOR
CERTAIN TYPES OF TRANSDUCERS. THE PROTESTER HAS ALSO FAILED TO SHOW THAT
ITS AND MKS'S PRODUCTS ARE SO UNIQUE THAT NO OTHER FIRM CAN FULFILL THE
GOVERNMENT'S NEEDS WITH RESPECT TO THOSE PRODUCTS. IN THIS REGARD, THE
SMALL BUSINESS PERCENTAGE OF TOTAL SALES UNDER CONTRACTS AWARDED
PURSUANT TO THE PRIOR, UNRESTRICTED SOLICITATION FOR THE FIVE TYPES OF
TRANSDUCERS RANGED FROM 35 PERCENT TO 82 PERCENT, AND THE ACTUAL NUMBER
OF SMALL BUSINESS FIRMS AWARDED CONTRACTS RANGED FROM 5 TO 17.
FURTHERMORE, FIVE SMALL BUSINESSES RESPONDED TO THE DATAMETRICS PROTEST
IN DEFENSE OF THE SET-ASIDE. UNDER THESE CIRCUMSTANCES, WE CANNOT FIND
THAT THE AGENCY ACTED WITHOUT REASONABLE EXPECTATION OF COMPETITION FOR
ALL VARIETIES OF TRANSDUCERS AND, THEREFORE, THE SET-ASIDE WAS PROPER.
FINALLY, SINCE THE AGENCY SET THESE ITEMS ASIDE PROPERLY, THE
DATAMETRICS CLAIM THAT THE SET-ASIDE WILL ADVERSELY AFFECT ITS SMALL
BUSINESS SUPPLIERS IS WITHOUT LEGAL MERIT. BELL & HOWELL, SUPRA;
SIMPSON ELECTRIC COMPANY, B-190320, FEBRUARY 15, 1978, 78-1 CPD 129.
THE HUGHES PROTEST
IN THIS RFP, GSA COMBINED TWO FORMER SPECIAL ITEM NUMBERS (SIN),
66-64(C) "INFRARED DETECTORS" AND 66-66 "OPTICAL AND INFRARED
PYROMETERS," TO CREATE A NEW SIN 66-66 "SYSTEMS THAT MEASURE THAT
ENERGY." THE NEW SIN HAD THREE SUBCATEGORIES: 66-66(A) "SYSTEMS WITH A
THERMAL IMAGING READOUT," 66-66(B) "SYSTEMS WITH A DIGITAL READOUT," AND
66-66(C) "ACCESSORIES AND OPTIONS." UNDER PRIOR SOLICITATIONS, SIN 66-66
HAD BEEN SET ASIDE FOR SMALL BUSINESSES AND SIN 66-64(C) HAD BEEN
UNRESTRICTED. GSA EVALUATED ITS PROCUREMENT HISTORY BY CLASSIFYING ITS
PRIOR CONTRACTS ACCORDING TO ITS NEW SYSTEM AND CONCLUDED THAT A
SUFFICIENT NUMBER OF SMALL BUSINESS OFFERORS WOULD BE REASONABLY
EXPECTED AND THAT A TOTAL SET-ASIDE WOULD BE PROPER.
HUGHES PROTESTS THAT THE DECISION TO COMBINE WAS ERRONEOUS, THAT ANY
SET-ASIDE SHOULD HAVE BEEN MADE ACCORDING TO THE NUMBER OF SMALL
BUSINESS CONTRACTS UNDER THE PRIOR CLASSIFICATIONS, THAT SMALL BUSINESS
PRICES IN THIS FIELD ARE EXCESSIVE, AND THAT SMALL BUSINESS PRODUCTS ARE
NOT TECHNICALLY EQUAL TO LARGE BUSINESS PRODUCTS.
THE PROTEST AGAINST THE REALIGNMENT OF SIN'S WAS NOT RAISED IN
HUGHES' INITIAL PROTEST. RATHER, IT WAS FIRST RAISED IN A LETTER FILED
IN THIS OFFICE LONG AFTER THE FEBRUARY 18 CLOSING DATE FOR PROPOSALS.
SINCE IT WAS CLEAR FROM THE SOLICITATION THAT THE SIN'S AT ISSUE WERE
BEING COMBINED, THIS GROUND OF THE PROTEST WAS KNOWN PRIOR TO CLOSING
AND MUST HAVE BEEN FILED PRIOR TO CLOSING TO BE TIMELY. 4 C.F.R. SEC.
21.2(B)(1) (1983). SINCE THE ISSUE WAS NOT RAISED TIMELY, THE PROTEST
TO THAT EXTENT IS DISMISSED.
THE ALLEGATION THAT INSUFFICIENT COMPETITION WILL BE CREATED BY A
SET-ASIDE CAN BE READILY EVALUATED BY REVIEWING THE OFFERS RECEIVED
UNDER THE SET-ASIDE. BELL & HOWELL, SUPRA. IN THIS CASE, GSA RECEIVED
7 OFFERS UNDER SIN 66-66(A), 13 OFFERS FOR 66-66(B), AND 6 OFFERS FOR
66-66(C), CLEARLY ESTABLISHING SUFFICIENT COMPETITION.
THE CLAIM THAT SMALL BUSINESS PRICES ARE UNREASONABLE IS ALSO REFUTED
BY THE PROPOSALS RECEIVED. THE PRICES RANGED FROM $8,600 FOR A BASIC
SYSTEM TO $69,900 FOR AN ADVANCED SYSTEM WITH A SUBSTANTIAL NUMBER OF
OPTIONS. THIS COMPARES FAVORABLY WITH HUGHES' OWN PRICES WHICH START AT
$9,500 AND RISE ACCORDING TO THE NUMBER OF OPTIONS NEEDED.
THE HUGHES CONTENTION THAT SMALL BUSINESSES CANNOT MEET THE
GOVERNMENT'S TECHNICAL NEEDS WAS SUPPORTED BY TWO USER AGENCIES. AFTER
TESTING THREE SMALL BUSINESS PRODUCTS, ONE AGENCY DECIDED THAT SMALL
BUSINESSES WOULD NOT MEET ITS NEEDS AND INFORMED GSA OF THIS
DETERMINATION. THE OTHER AGENCY BASED ITS OBJECTION TO THE SET-ASIDE ON
ITS SATISFACTION WITH PREVIOUSLY ACQUIRED LARGE BUSINESS PRODUCTS. GSA
CONSIDERED THOSE AGENCY CONCERNS AND INVESTIGATED THE PRODUCTS MADE BY
SMALL BUSINESSES TO INSURE THAT THE SHORTCOMINGS IN CERTAIN SMALL
BUSINESS PRODUCTS WOULD NOT BE REPEATED IN EVERY OFFERORS' PRODUCTS.
GSA FOUND THAT ALL AGENCY NEEDS COULD BE MET BY SMALL BUSINESSES.
THEREFORE, WE CANNOT FIND THAT GSA SET THESE SIN'S ASIDE WITHOUT A
REASONABLE EXPECTATION OF TECHNICALLY ACCEPTABLE OFFERS WHICH WOULD MEET
THE GOVERNMENT'S NEEDS.
HUGHES HAS CALLED OUR ATTENTION TO ALLEGED SIMILARITIES BETWEEN THIS
CASE AND ANOTHER RECENT CASE, DISA ELECTRONICS (DISA), 62 COMP.GEN.
(B-206798, MARCH 25, 1983), 83-1 CPD 306. THIS CASE DIFFERS
SUBSTANTIALLY FROM DISA. HERE, WE DO NOT HAVE A THIRD CONSECUTIVE YEAR
OF SET-ASIDES WHERE THE AGENCY KNOWS THAT THE MOST POPULAR TYPE OF A
BROAD CATEGORY OF PRODUCTS IS PRODUCED BY ONLY ONE SMALL BUSINESS FIRM
AND ONLY THAT FIRM IS RECEIVING THE LION'S SHARE OF THE CONTRACTS. THIS
IS A FIRST ATTEMPT AT A SET-ASIDE IN A FIELD WITH A SUBSTANTIAL NUMBER
OF SMALL BUSINESSES CAPABLE OF PRODUCING ALL VARIETIES OF THE SOLICITED
ITEMS.
THE LINEAR PROTEST
LINEAR PROTESTS THAT IT IS UNJUSTIFIABLY BEING EXCLUDED FROM
COMPETITION FOR SIN 66-66 BECAUSE IT HAS ONLY 160 MORE EMPLOYEES THAN
THE ESTABLISHED SMALL BUSINESS LIMIT. FURTHER, LINEAR CLAIMS THAT SIN
66-66 COVERS A CATEGORY OF PRODUCTS WHICH IS OVERLY BROAD AND THAT THE
GOVERNMENT CANNOT FULFILL ITS NEEDS FOR HIGHLY SPECIALIZED PRODUCTS SUCH
AS THOSE LINEAR PRODUCES WITH RESTRICTED COMPETITION.
AS WE NOTED EARLIER WITH RESPECT TO THE DATAMETRICS PROTEST, SMALL
BUSINESS SIZE STANDARDS ARE NOT REVIEWED BY GAO. PACIFIC DIVING
INDUSTRIES, INC., SUPRA.
LINEAR'S CLAIM THAT THE GOVERNMENT CANNOT FULFILL ITS NEEDS WITHOUT
LINEAR'S PARTICIPATION IN THE SOLICITATION IS NOT BORNE OUT BY THE FACTS
SURROUNDING THIS CASE. THE PURPOSE OF THE FSS IS TO PROVIDE AGENCIES
WITH OFFERS FOR A WIDE VARIETY OF SIMILAR ITEMS. DISA ELECTRONICS,
SUPRA. AT THE CLOSING DATE FOR PROPOSALS, GSA HAD RECEIVED 6, 7, AND 13
OFFERS FOR THE THREE SUBCATEGORIES OF SIN 66-66. THESE OFFERS COVERED A
VARIETY OF PRODUCTS RANGING FROM THE BASIC TO THE HIGHLY COMPLEX. IN
LIGHT OF THIS, THE GOVERNMENT REASONABLY EXPECTED AND APPARENTLY
RECEIVED ADEQUATE COMPETITION UNDER THE SET-ASIDE. BELL & HOWELL,
SUPRA.
B-210515, JUN 9, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT CONSIDER PROTEST CONCERNING PROCUREMENT ACTIONS OF
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT IN CONNECTION WITH PROPERTY
MAINTENANCE RESPONSIBILITIES UNDER NATIONAL HOUSING ACT, 12 U.S.C. SEC.
1701 ET SEQ. (1976), IN VIEW OF SECRETARY'S BROAD STATUTORY AUTHORITY TO
MAKE EXPENDITURES IN CONNECTION WITH THOSE RESPONSIBILITIES.
METRO SALES CORPORATION:
METRO SALES CORPORATION PROTESTS THE REJECTION OF ITS BID AS
NONRESPONSIVE BY THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD)
UNDER INVITATION FOR BIDS (IFB) NO. 0002-83-043. WE DISMISS THE
PROTEST.
THE IFB SOLICITED BIDS TO PROVIDE CREDIT REPORTS ON INDIVIDUALS
BUYING HUD-HELD PROPERTIES UNDER THE FEDERAL HOUSING ACT MORTGAGE
INSURANCE PROGRAM, AND REQUIRED EVIDENCE OF BIDDERS' AGREEMENTS WITH
QUALIFIED PUBLIC RECORD REPORTING SERVICES. THE CONTRACTING OFFICER
FOUND THAT METRO'S BID DID NOT CONTAIN THE REQUIRED AGREEMENTS AND DID
NOT CLEARLY INDICATE THAT METRO COULD SERVICE ALL THE COUNTIES IN THE
STATE OF OHIO. METRO, HOWEVER, CONTENDS THAT THE CONTRACTING OFFICER
MISTAKENLY FOUND THIS INFORMATION LACKING.
WE NOTE FIRST THAT ALTHOUGH THE CONTRACTING OFFICER CHARACTERIZED THE
BID AS NONRESPONSIVE, THE BASIS FOR REJECTION ACTUALLY INVOLVES METRO'S
RESPONSIBILITY. "RESPONSIVENESS" CONCERNS WHETHER A BIDDER HAS
UNEQUIVOCALLY OFFERED TO PROVIDE SUPPLIES OR SERVICES IN CONFORMITY WITH
THE MATERIAL TERMS AND CONDITIONS OF THE SOLICITATION; "RESPONSIBILITY"
REFERS TO THE BIDDER'S APPARENT ABILITY AND CAPACITY TO PERFORM ALL THE
CONTRACT REQUIREMENTS. SKYLINE CREDIT CORPORATION, B-209193, MARCH 15,
1983, 83-1 CPD 257. METRO'S AGREEMENTS WITH QUALIFIED REPORTING
SERVICES AND ABILITY TO SERVICE THE ENTIRE STATE CLEARLY FALL IN THE
LATTER CATEGORY. MOREOVER, MATERIAL RELATING TO RESPONSIBILITY, EVEN
THOUGH REQUIRED TO BE SUBMITTED WITH THE BIDS, GENERALLY CANNOT BE
TREATED AS A MATTER OF RESPONSIVENESS. ID.
NEVERTHELESS, WE WILL NOT CONSIDER METRO'S PROTEST. ALTHOUGH IT WAS
NOT APPARENT UNTIL WE RECEIVED HUD'S REPORT, THIS PROCUREMENT WAS
CONDUCTED UNDER AUTHORITY OF AND FUNDED PURSUANT TO THE NATIONAL HOUSING
ACT, 12 U.S.C. SEC. 1701 ET SEQ. (1976). THE ACT AUTHORIZES THE
SECRETARY OF HUD TO MAKE SUCH EXPENDITURES AS ARE NECESSARY TO CARRY OUT
THE MAINTENANCE OR IMPROVEMENT OF PROPERTY WITHOUT REGARD TO ANY OTHER
PROVISIONS OF LAW GOVERNING THE EXPENDITURE OF PUBLIC FUNDS. 12 U.S.C.
SEC. 1702.
IN VIEW OF THIS EXTRAORDINARY AUTHORITY GRANTED THE SECRETARY, WE
HAVE HELD THAT WE WOULD HAVE NO LEGAL BASIS TO QUESTION THE EXPENDITURE
OF FUNDS UNDER THAT PROVISION. EDWARD H. PINE INSURANCE, B-211065, APRIL
11, 1983, 83-1 CPD 377.
THE PROTEST IS DISMISSED.
B-210507 L/M, APR 4, 1983, OFFICE OF GENERAL COUNSEL
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
KEVIN D. ROONEY, DEPARTMENT OF JUSTICE:
THIS IS IN REPLY TO YOUR REQUEST THAT RELIEF BE GRANTED UNDER 31 U.
S.C. SEC. 82A-1 (NOW 31 U.S.C. SEC. 3527(A)), TO WILLIAM N. ALDRIDGE, A
SPECIAL AGENT OF THE DRUG ENFORCEMENT ADMINISTRATION, FROM LIABILITY FOR
THE LOSS OF $2000 RESULTING FROM THE THEFT OF HIS BRIEFCASE. FOR THE
REASONS GIVEN BELOW, WE GRANT RELIEF.
IN THIS CASE THE RECORD SHOWS THAT WHILE AWAITING A PLANE ON THE WAY
TO MAKING A PAYMENT TO A CONFIDENTIAL INFORMANT, SPECIAL AGENT ALDRIDGE
STOPPED IN A COFFEE SHOP AT THE CONGONAS AIRPORT, SAO PAULO, BRAZIL.
THERE, HE PLACED HIS BRIEFCASE CONTAINING FUNDS TO PAY OFF AN INFORMANT
ON THE FLOOR NEXT TO HIS RIGHT FOOT FOR A PERIOD OF 15-20 SECONDS SO
THAT HE COULD REMOVE HIS JACKET. AS HE BENT DOWN TO PLACE HIS JACKET ON
THE BRIEFCASE, SPECIAL AGENT ALDRIDGE DISCOVERED THAT THE BRIEFCASE WAS
MISSING. THE LOCAL POLICE SEARCHED THE AIRPORT, BUT WERE UNABLE TO
LOCATE THE THIEF. LATER, THE POLICE EXPLAINED THAT SEVERAL SIMILAR
THEFTS RECENTLY HAD OCCURRED IN THE AIRPORT IN WHICH "AFFLUENT LOOKING"
INDIVIDUALS WERE VICTIMIZED.
THE RECORD ALSO SHOWS THAT IT WAS NOT POSSIBLE FOR ANYONE TO HAVE
KNOWN THAT SPECIAL AGENT ALDRIDGE HAD CURRENCY IN HIS BRIEFCASE. THE
MONEY WAS IN A LARGE BROWN ENVELOPE WHICH WAS PLACED IN THE BACKFLAP OF
THE BRIEFCASE SO THAT IT WAS NOT VISIBLE UPON OPENING THE BRIEFCASE.
SPECIFICALLY, YOU REQUEST THAT THIS OFFICE APPLY OUR DECISION IN 61
COMP.GEN. 313, B-204908, MARCH 31, 1982 TO THE FACTS OF THIS CASE. OUR
DECISION IN 61 COMP.GEN. 313, ID., PROVIDED THAT THE DRUG ENFORCEMENT
ADMINISTRATION IS NOT REQUIRED TO SEEK RELIEF UNDER 31 U.S.C. SEC. 3527
FOR SPECIAL AGENTS WHO LOSE FUNDS ADVANCED TO PURCHASE CONTROLLED
SUBSTANCES WHERE THE LOSS RESULTS FROM A CALCULATED RISK OF THE DRUG
ENFORCEMENT OPERATION. UNDER THESE CIRCUMSTANCES THE FUNDS SHOULD BE
RECORDED AS A NECESSARY INVESTIGATIVE EXPENSE OF THE AGENCY AND THUS
CLEAR THE ACCOUNT. SINCE THERE IS NO LOSS UNDER THIS ANALYSIS, WE DO
NOT TECHNICALLY GRANT RELIEF UNDER 31 U.S.C. SEC. 3527 IN SUCH
CIRCUMSTANCES. HOWEVER, AN AGENCY MUST STILL SEEK RELIEF UNDER 31 U.S.
C. SEC. 3527, SUPRA, WHERE AN OFFICER OR EMPLOYEE LOSES FUNDS UNDER
CIRCUMSTANCES WHICH ARE UNRELATED TO CARRYING OUT THE PURPOSES FOR WHICH
THE FUNDS WERE ENTRUSTED. ACCORDINGLY, WE CANNOT GRANT RELIEF TO
SPECIAL AGENT ALDRIDGE UNDER THE RATIONALE OF 61 COMP.GEN. 313, ID.,
BECAUSE THE LOSS OCCURRED UNDER CIRCUMSTANCES UNRELATED TO THE CARRYING
OUT OF THE DRUG ENFORCEMENT OPERATION. UNDER THE FACTS AS PRESENTED,
THE THEFT OCCURRED DURING TRANSPORTATION OF THE MONEY WHICH WAS AT MOST
ONLY INCIDENTAL TO THE PAYMENT OF THE INFORMANT.
THIS OFFICE IS AUTHORIZED UNDER 31 U.S.C. SEC. 3527 TO RELIEVE AN
ACCOUNTABLE OFFICER OR AGENT OF LIABILITY ON ACCOUNT OF A PHYSICAL LOSS
OF GOVERNMENT FUNDS IF IT CONCURS IN THE DETERMINATIONS BY THE HEAD OF
THE OFFICER'S AGENCY THAT THE LOSS OCCURRED WHILE THE OFFICER WAS ACTING
IN THE DISCHARGE OF HIS OFFICIAL DUTIES, AND WITHOUT FAULT OR
NEGLIGENCE. IN GENERAL, ANY GOVERNMENT OFFICER OR EMPLOYEE WHO BY
REASON OF HIS OR HER EMPLOYMENT IS RESPONSIBLE FOR OR HAS CUSTODY OF
GOVERNMENT FUNDS IS AN ACCOUNTABLE OFFICER. 59 COMP.GEN. 113, 114
(1979). WE CONSISTENTLY HAVE TREATED LAW ENFORCEMENT PERSONNEL WITH
CUSTODY OF GOVERNMENT FUNDS AS ACCOUNTABLE OFFICERS. SEE B-192010,
AUGUST 14, 1978 AND B-191891, JUNE 16, 1980.
ON THE BASIS OF THE FACTS PRESENTED, YOU HAVE DETERMINED THAT THE
LOSS OCCURRED WHILE SPECIAL AGENT ALDRIDGE WAS ACTING IN THE DISCHARGE
OF HIS OFFICIAL DUTIES AND WITHOUT FAULT OR NEGLIGENCE ON HIS PART.
THIS DETERMINATION IS SUPPORTED BY THE FINDINGS OF A BOARD OF
INVESTIGATION, WHICH AMONG ITS FINDINGS CONCLUDED THAT:
"THE LOSS DID NOT RESULT FROM NEGLIGENCE ON THE PART
OF THE EMPLOYEE BUT RATHER FROM A SKILLFUL CRIMINAL
UTILIZING THE ELEMENT OF SURPRISE."
WE CONCUR IN YOUR DETERMINATION. NOTHING IN THE RECORD SUGGESTS THAT
THE THEFT DID NOT OCCUR AS REPORTED.
ACCORDINGLY, WE GRANT RELIEF TO SPECIAL AGENT ALDRIDGE IN THE AMOUNT
OF $2000. A CHARGE MAY BE MADE TO THE PROPER APPROPRIATION.
B-210502, FEB 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
QUESTION WHETHER CONTRACTOR IS PERFORMING IN ACCORDANCE WITH CONTRACT
TERMS IS A MATTER OF CONTRACT ADMINISTRATION FOR RESOLUTION BY THE
CONTRACTING AGENCY, NOT GAO.
CANYON LAKE SANITATION SERVICE:
CANYON LAKE SANITATION SERVICE QUESTIONS WHETHER THE FIRM AWARDED U.
S. ARMY CORPS OF ENGINEERS CONTRACT NO. DACW63-82-B-0106 IS PERFORMING
IN ACCORDANCE WITH THE SPECIFICATIONS AND OTHER PROVISIONS OF THAT
CONTRACT.
A QUESTION WHETHER A CONTRACTOR IS PERFORMING IN ACCORDANCE WITH THE
CONTRACT TERMS IS A MATTER OF CONTRACT ADMINISTRATION FOR RESOLUTION BY
THE CONTRACTING AGENCY AND WILL NOT BE CONSIDERED BY OUR OFFICE.
DYNA-COTE IND., INC., B-208543, SEPTEMBER 8, 1982, 82-2 CPD 211.
THE PROTEST IS DISMISSED.
B-210500.2, JUN 13, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. BID IS NONRESPONSIVE WHERE INVITATION REQUIRED THE SUCCESSFUL
BIDDER TO SUPPLY AND SUPERVISE THE INSTALLATION OF AN INCINERATOR, AND
THE BID CONTAINS A NOTATION THAT THE PRICE INCLUDES 5 DAYS OF
INSTALLATION SUPERVISION. TO BE RESPONSIVE, A BID MUST REPRESENT AN
UNEQUIVOCAL OFFER TO MEET THE INVITATION'S MATERIAL REQUIREMENTS AT THE
BID PRICE, BUT THIS BID CONDITIONS ITS PRICE UPON NO MORE THAN 5 DAYS OF
SUPERVISION, AND LIMITS THE GOVERNMENT'S RIGHT TO REQUIRE SUPERVISION OF
THE INCINERATOR'S INSTALLATION UNTIL COMPLETED.
2. BIDDER RELIED AT ITS OWN RISK ON ALLEGED ORAL ADVICE BY
CONTRACTING PERSONNEL THAT THE FIRM COULD QUALIFY ITS BID PRICE, WHERE
THE INVITATION INCORPORATED STANDARD LANGUAGE THAT ORAL EXPLANATIONS OR
INSTRUCTIONS ARE NOT BINDING. MOREOVER, ERRONEOUS ADVICE CANNOT ESTOP
THE CONTRACTING AGENCY FROM REJECTING A NONRESPONSIVE BID SINCE IT IS
REQUIRED TO DO SO BY LAW.
3. BID RESPONSIVENESS MUST BE DETERMINED FROM THE MATERIAL AVAILABLE
AT BID OPENING, AND POST-OPENING EXPLANATIONS THEREFORE CANNOT BE
CONSIDERED TO CORRECT A NONRESPONSIVE BID, EVEN IF A LOWER PRICE COULD
BE OBTAINED BY ACCEPTING THE CORRECTED BID.
INTERNATIONAL WASTE INDUSTRIES:
INTERNATIONAL WASTE INDUSTRIES PROTESTS THE VETERANS ADMINISTRATION'S
REJECTION OF ITS BID UNDER INVITATION FOR BIDS NO. 671-13-83. THE
INVITATION REQUIRED THE SUCCESSFUL BIDDER TO SUPPLY, AND SUPERVISE THE
INSTALLATION OF, AN INCINERATOR IN THE AUDIE L. MURPHY MEMORIAL
VETERANS HOSPITAL, SAN ANTONIO, TEXAS. THE VETERANS ADMINISTRATION
DETERMINED THE BID WAS NONRESPONSIVE BECAUSE THE BID INCLUDED A NOTATION
THAT, IN THE AGENCY'S VIEW, QUALIFIED THE BIDDER'S OBLIGATION TO
SUPERVISE THE INCINERATOR'S INSTALLATION. WE AGREE WITH THE VETERANS
ADMINISTRATION, AND WE THEREFORE DENY THE PROTEST.
THE INVITATION PROVIDED THAT INSTALLATION WOULD BE PERFORMED BY
OTHERS BUT REQUIRED THAT THE CONTRACTOR SUPERVISE THE INSTALLATION OF
THE EQUIPMENT AND ALL UTILITY CONNECTIONS WITHIN 10 FEET OF THE
INCINERATOR. INTERNATIONAL WASTE INDUSTRIES' BID STATED: "NOTE: 5
DAYS OF INSTALLATION SUPERVISION IS INCLUDED IN THE ABOVE PRICE."
ACCORDING TO INTERNATIONAL WASTE INDUSTRIES' PROTEST SUBMISSION, THE
REASON FOR THE NOTATION WAS THE FIRM'S ESTIMATION THAT THE INSTALLATION
WOULD ENTAIL 10 MAN-DAYS OF RIGGING, PLUMBING, AND WIRING WORK. THIS
WAS BASED ON THE ASSUMPTION THAT THE RIGGING WOULD REQUIRE 2 DAYS, AFTER
WHICH TWO TEAMS OF TWO MEN COULD ACCOMPLISH THE PLUMBING AND WIRING IN
AN ADDITIONAL 2 DAYS, FOR A TOTAL OF 10-MAN DAYS. SINCE ALL THIS WORK
PRESUMABLY WOULD BE ACCOMPLISHED IN A 4-DAY PERIOD, THE PROTESTER
DETERMINED THAT THE PROJECT SHOULD INVOLVE ONLY 4 MAN-DAYS OF
SUPERVISION.
THE INVITATION DID NOT SPECIFY WHAT SIZE OR TYPE OF WORK CREW WOULD
INSTALL THE INCINERATOR, AND, DEPENDING ON THE SIZE OF THE CREW USED AND
THE SPEED WITH WHICH IT WORKED, IT IS OBVIOUS THAT THE INSTALLATION
COULD TAKE MORE THAN 5 DAYS. THE VETERANS ADMINISTRATION THEREFORE
CONSIDERED THE NOTATION AS A QUALIFICATION OF THE BIDDER'S OBLIGATION TO
SUPERVISE THE INCINERATOR'S INSTALLATION. THE AGENCY THEREFORE REJECTED
THE BID AS NONRESPONSIVE BECAUSE THE BID DID NOT OFFER A FIRM FIXED
PRICE TO MEET THE GOVERNMENT'S NEEDS.
WE BELIEVE THE VETERANS ADMINISTRATION CORRECTLY CONSTRUED THE
NOTATION AS LIMITING THE BIDDER'S OBLIGATION TO PROVIDE SUPERVISION AND
PROPERLY DETERMINED THE BID TO BE NONRESPONSIVE.
TO BE RESPONSIVE, A BID MUST UNEQUIVOCALLY OFFER TO MEET THE
INVITATION'S MATERIAL TERMS AT THE BID PRICE. 4. BARANELLO AND SONS, 58
COMP.GEN. 509, 514 (1979), 79-1 CPD 322. MATERIAL TERMS OF AN
INVITATION ARE THOSE TERMS THAT HAVE MORE THAN A TRIVIAL EFFECT ON
PRICE, QUALITY, QUANTITY OR DELIVERY. SEE ACTION MANUFACTURING COMPANY,
B-208205.2, DECEMBER 13, 1982, 82-2 CPD 526. A BID THAT LIMITS THE
FIRM'S CONTRACTUAL OBLIGATION, IF THE FIRM IS AWARDED THE CONTRACT AT
THE BID PRICE, TO OTHER THAN THE OBLIGATION REFLECTED IN THE
INVITATION'S MATERIAL TERMS, THUS GENERALLY MUST BE REJECTED. SEE
MEDI-CAR OF ALACHUA COUNTY, B-205634, MAY 7, 1982, 82-1 CPD 439.
THE NOTATION IN THE BID CLEARLY APPEARS TO LIMIT INTERNATIONAL WASTE
INDUSTRIES' OBLIGATION AT ITS BID PRICE TO PROVIDING NO MORE THAN 5 DAYS
OF SUPERVISION. THEREFORE, THE BID DOES NOT OFFER UNEQUIVOCALLY TO MEET
THE INVITATION'S TERMS AT THE BID PRICE. THE BID BOTH FAILS TO OFFER A
FIRM FIXED PRICE FOR SUPERVISION THROUGH COMPLETE INSTALLATION, AND
LIMITS THE GOVERNMENT'S RIGHT TO REQUIRE SUPERVISION OF SUCH
INSTALLATION. THE VETERANS ADMINISTRATION THEREFORE PROPERLY REJECTED
THE BID.
THE PROTESTER ALLEGES THAT IT INCLUDED THE NOTATION ABOUT THE NUMBER
OF INSTALLATION SUPERVISION DAYS REFLECTED IN THE BID PRICE BASED ON THE
ORAL ADVICE OF SOMEONE AT THE CONTRACTING ACTIVITY. WHILE THE VETERANS
ADMINISTRATION DENIES HAVING SO ADVISED THE PROTESTER, THE ALLEGATION,
IF PROVEN, WOULD NOT AFFECT THE RESULT HERE. THE INVITATION
INCORPORATED STANDARD FORM 33-A WHICH CLEARLY STATES THAT ORAL
EXPLANATIONS OR INSTRUCTIONS GIVEN BEFORE AWARD WILL NOT BE BINDING, AND
THAT ANY EXPLANATIONS DESIRED REGARDING THE MEANING OF THE SOLICITATION
MUST BE REQUESTED IN WRITING. THE BIDDER THEREFORE RELIED ON ANY ORAL
EXPLANATION AT ITS OWN RISK. TRIDENT INDUSTRIAL PRODUCTS, INC., 59
COMP.GEN. 742 (1980), 80-2 CPD 222. MOREOVER, ERRORNEOUS ADVICE GIVEN
BY AGENCY OFFICIALS CANNOT ESTOP THE AGENCY FROM REJECTING A
NONRESPONSIVE BID, SINCE THE AGENCY IS REQUIRED TO DO SO BY LAW. ID.
FINALLY, THE PROTESTER POINTS OUT THAT AFTER BID OPENING IT SENT THE
AGENCY A MAILGRAM DELETING THE NOTATION IN ISSUE. THE RESPONSIVENESS OF
A BID, HOWEVER, MUST BE DETERMINED FROM THE MATERIAL AVAILABLE AT BID
OPENING, AND POST-OPENING EXPLANATIONS THEREFORE CANNOT BE CONSIDERED TO
CORRECT A NONRESPONSIVE BID, EVEN IF A LOWER PRICE COULD BE OBTAINED BY
ACCEPTING THE CORRECTED BID. SUNSAV, INC., B-205004.2, NOVEMBER 29,
1982, 82-2 CPD 476.
THE PROTEST DENIED.
B-210499, JUN 13, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. BID PROTEST, FILED AFTER BID OPENING, ALLEGING THAT THE IFB, AS
AMENDED, WAS AMBIGUOUS, IS TIMELY SINCE THE PROTESTER WAS UNAWARE OF THE
AMENDMENT AND, THERFORE, THE BASIS OF PROTEST UNTIL AFTER BID OPENING.
2. CONTRACTING AGENCY PROPERLY EVALUATED BIDS CONSISTENT WITH THE
EVALUATION SCHEME BASED ON ANTICIPATED WORK REQUIREMENTS SET FORTH IN
AMENDMENT TO THE INVITATION FOR BIDS AS AMENDED, RATHER THAN, AS
PROTESTER CONTENDS, PURSUANT TO INITIALLY ISSUED SCHEME WHICH SET FORTH
THREE POSSIBLE EVALUATION ALTERNATIVES.
MICROTECH INDUSTRIES, INC.:
MICROTECH INDUSTRIES, INC. (MICROTECH), PROTESTS THE AWARD OF A
REQUIREMENTS CONTRACT TO MATCO MICROGRAPHICS, INC. (MATCO), BY THE
DEPARTMENT OF THE NAVY (NAVY) UNDER INVITATION FOR BIDS (IFB) NO.
N00104-83-B-0066, FOR APERATURE CARD SERVICES.
WE DENY THE PROTEST.
THE NAVY ISSUED AMENDMENT NO. 1 AFTER A PROSPECTIVE BIDDER ALLEGED
THAT THE IFB'S EVALUATION CRITERIA WERE AMBIGUOUS. THAT AMENDMENT
PROVIDED THAT EVALUATION FOR AWARD WOULD BE BASED ON EXTENDED PRICES
BASED ON THE 12-MONTH USAGE ESTIMATE FOR THE FOUR LINE ITEMS IN THE
DELIVERY ORDER LIMITATIONS PORTION OF THE IFB. MATCO WAS THE LOW BIDDER
UNDER THIS EVALUATION SCHEME. MICROTECH DID NOT RECEIVE A COPY OF THIS
AMENDMENT AND, CONSEQUENTLY, FAILED TO ACKNOWLEDGE IT.
MICROTECH'S POSITION IS THAT THE IFB'S EVALUATION FACTORS WERE NOT
AMBIGUOUS PRIOR TO THE ISSUANCE OF AMENDMENT NO. 1. MICROTECH SUBMITS
THAT THE SCHEDULE CLEARLY LISTED THE FOUR SERVICES TO BE PERFORMED, THE
ESTIMATED MINIMUM AND MAXIMUM MONTHLY QUANTITIES, AND A SPACE FOR UNIT
PRICE AND TOTAL AMOUNT. APPARENTLY, MICROTECH WOULD BE THE LOW BIDDER
IF THE EVALUATION WAS BASED ON UNIT OR AGGREGATE PRICES FOR THE MINIMUM
AND MAXIMUM MONTHLY QUANTITIES. MICROTECH CONTENDS THAT THE AMENDMENT
MAKES THE IFB AMBIGUOUS AND THAT AWARD SHOULD BE MADE ON THE BASIS OF
THE ORIGINAL IFB SCHEDULE. IN REGARD TO ITS FAILURE TO RECEIVE THE
AMENDMENT, MICROTECH QUESTIONS THE EFFECTIVENESS OF THE NAVY'S MAILING
BECAUSE THE ABSTRACT OF BIDS INDICATES THAT AT LEAST TWO OTHER BIDDERS
DID NOT RECEIVE THE AMENDMENT. FURTHERMORE, MICROTECH ALLEGES THAT IT
IS QUESTIONABLE WHETHER MATCO ACKNOWLEDGED THE AMENDMENT SINCE MICROTECH
WAS GIVEN AN UNSIGNED COPY OF MATCO'S AMENDMENT.
THE NAVY ARGUES THAT MICROTECH'S PROTEST IS UNTIMELY SINCE IT
QUESTIONS ALLEGED APPARENT IMPROPRIETIES WHICH MUST BE PROTESTED PRIOR
TO BID OPENING, CITING 4 C.F.R. SEC. 21.2(B)(1) (1983). IN THE
ALTERNATIVE, THE NAVY CONTENDS THAT THE IFB, AS AMENDED, CLEARLY AND
ADEQUATELY DEFINED THE BASIS FOR AWARD AND THAT AWARD WAS REQUIRED TO BE
MADE ON THAT BASIS. THE NAVY ADVISES THAT THE AMENDMENT WAS NOT
CONSIDERED MATERIAL AND NO BID WAS REJECTED FOR FAILURE TO ACKNOWLEDGE
IT. FURTHERMORE, THE NAVY SUBMITS THAT THERE WAS NO DELIBERATE ATTEMPT
TO EXCLUDE ANYONE SINCE IT MAILED THE AMENDMENT TO ALL OF THE
PROSPECTIVE BIDDERS ORIGINALLY SOLICITED.
AS FOR TIMELINESS, MICROTECH WAS NOT AWARE OF THE PROTESTED AMENDMENT
UNTIL AFTER BID OPENING. THEREFORE, BECAUSE MICROTECH RAISED THIS BASIS
OF PROTEST WITHIN 10 WORKING DAYS OF ADVICE OF THE AMENDMENT'S
EXISTENCE, IT IS TIMELY AND WILL BE CONSIDERED ON THE MERITS. 4 C.F.R.
SEC. 21.2(B)(2) (1983).
MICROTECH'S CONTENTION THAT THE IFB, INCLUDING AMENDMENT NO. 1, WAS
AMBIGUOUS IS WITHOUT MERIT. AS STATED ABOVE, AMENDMENT NO. 1
SPECIFICALLY PROVIDED THE BASIS FOR AWARD, THE 12-MONTH USAGE
QUANTITIES. IN CONTRAST, THE IFB AS INITIALLY ISSUED, PROVIDED NO
SPECIFIC BASIS FOR AWARD, BUT THREE ALTERNATIVES - AWARD BASED ON
MINIMUM QUANTITIES, MAXIMUM QUANTITIES, OR 12-MONTH USAGE QUANTITIES.
MICROTECH ALSO ARGUES THAT AMENDMENT NO. 1 SHOULD BE IGNORED SINCE
THE NAVY DETERMINED THAT THE AMENDMENT WAS A MERE CLARIFICATION AND NOT
MATERIAL. WE NOTE THAT THE NAVY'S DETERMINATION WAS LIMITED TO THE
QUESTION OF WHETHER TO REJECT ANY BIDS THAT FAILED TO ACKNOWLEDGE THE
AMENDMENT. IN THAT CONTEXT, THE NAVY APPARENTLY FOUND THAT SINCE EACH
BIDDER WHICH SUBMITTED UNIT PRICES WOULD STILL BE OBLIGATED TO PERFORM
AS REQUIRED BY THE IFB, THE FAILURE TO ACKNOWLEDGE THE AMENDMENT COULD
BE WAIVED AS A MINOR INFORMALITY. (CONTRARY TO MICROTECH'S ASSERTION,
THE RECORD CONTAINS A PROPERLY ACKNOWLEDGED AMENDMENT OF MATCO'S BID.)
IN ANY EVENT, THE AMENDMENT WAS MATERIAL TO THE EXTENT THAT IT
SPECIFICALLY SET FORTH THE PREVIOUSLY UNSPECIFIED BASIS FOR AWARD AND,
OF PARTICULAR SIGNIFICANCE, STIPULATED AN AWARD BASIS THAT REPRESENTED
THE AGENCY'S ACTUAL ANTICIPATED REQUIREMENTS. IN THE LATTER REGARD,
AWARD ON ANY OTHER BASIS WOULD NOT NECESSARILY HAVE RESULTED IN THE LOW
COST TO THE GOVERNMENT IN VIOLATION OF STATUTE AND REGULATIONS. SEE
TENNESSEE VALLEY SERVICE COMPANY, B-188771, JULY 20, 1977, 77-2 CPD 40.
THIS IS AMPLY DEMONSTRATED BY THE FACT THAT MICROTECH'S BID IS LOW ON
ALL BASES EXCEPT THE PROPER ONE, WHICH WAS BASED ON THE ANTICIPATED WORK
ESTABLISHED BY AMENDMENT NO. 1. ACCORDINGLY, THE AWARD WAS CORRECTLY
BASED UNDER THE IFB, AS AMENDED.
MICROTECH'S BID WAS EVALUATED ON A COMMON BASIS WITH THE OTHER BIDS,
AND THE PROTESTER HAS NOT DEMONSTRATED PREJUDICE BY THE AGENCY'S
EVALUATION OF ITS BID BASED ON THE ACTUAL WORK REQUIREMENTS. EVEN IF
MICROTECH COULD SHOW AN ADVERSE EFFECT ON ITS COMPETITIVE STANDING BY
THE NONRECEIPT, WE HAVE HELD THAT NO RELIEF IS APPROPRIATE UNLESS
FAILURE TO RECEIVE IS DUE TO A CONSCIOUS AND DELIBERATE EFFORT BY THE
PROCURING AGENCY TO EXCLUDE A BIDDER FROM PARTICIPATING IN THE
COMPETITION. MARINO CONSTRUCTION COMPANY, INC., B-204970, FEBRUARY 25,
1982, 82-1 CPD 167. MICROTECH NEITHER ALLEGES NOR PROVIDES ANY EVIDENCE
THAT THE NAVY DELIBERATELY FAILED TO SEND THE FIRM AMENDMENT NO. 1.
RATHER, MICROTECH ONLY QUESTIONS THE EFFECTIVENESS OF THE NAVY'S MAILING
OF AMENDMENT NO. 1 SINCE THE ABSTRACT SHOWS THAT AT LEAST TWO BIDDERS
DID NOT RECEIVE THE AMENDMENT. THIS ALONE IS NOT ENOUGH TO SHOW A
CONSCIOUS OR DELIBERATE EFFORT TO EXCLUDE MICROTECH FROM THIS
PROCUREMENT. MOREOVER, WE NOTE THAT THE ABSTRACT NOTES ONLY THAT TWO
BIDDERS DID NOT RETURN THE AMENDMENT, AND NO REASONS ARE GIVEN
THEREFORE.
PROTEST DENIED.
B-210496, FEB 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST INVOLVING FEDERAL DEPOSIT INSURANCE CORPORATION PROCUREMENT
WILL NOT BE CONSIDERED SINCE CORPORATION'S ACCOUNTS ARE NOT SUBJECT TO
SETTLEMENT BY GAO.
H. "MANNY" HOLTZ, INC.:
H. "MANNY" HOLTZ, INC., PROTESTS THE REJECTION OF ITS BID UNDER
SOLICITATION NO. FDIC-P-82-2223, ISSUED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION (FDIC). FOR THE REASONS INDICATED BELOW, WE DECLINE TO
CONSIDER PROTESTS RELATIVE TO FDIC OPERATIONS.
THE GOVERNMENT CORPORATION CONTROL ACT DEFINES THE FDIC AS A
"MIXED-OWNERSHIP GOVERNMENT CORPORATION." 31 U.S.C. SEC. 9101 (FORMERLY
31 U.S.C. SEC. 856 (1976), AS AMENDED). AS A GOVERNMENT CORPORATION,
THE FDIC POSSESSES SPECIFIC POWERS FOR CARRYING OUT ITS STATUTORY
DUTIES. SEE 12 U.S.C. SEC. 1819 (1976).
OUR PROTEST JURISDICTION IS BASED ON OUR AUTHORITY TO ADJUST AND
SETTLE ACCOUNTS AND TO CERTIFY BALANCES IN THE ACCOUNTS OF ACCOUNTABLE
OFFICERS. 31 U.S.C. SEC. 3526 (FORMERLY 31 SECS. 71, 74 (1976)); 4 C.
F.R. SEC. 21.1(A) (1982). IN THE CASE OF MIXED-OWNERSHIP GOVERNMENT
CORPORATIONS, SUCH AS THE FDIC, OUR OFFICE IS LIMITED TO PERFORMING AN
AUDIT OF THEIR FINANCIAL TRANSACTIONS AND REPORTING OUR FINDINGS AND
RECOMMENDATIONS TO THE CONGRESS. 12 U.S.C. SEC. 1827 AND 31 U.S.C.
SECS. 9105, 9106 (FORMERLY 31 U.S.C. SECS. 857, 858 (1976)). WE HAVE
ALSO RECOGNIZED THAT BY CONSENTING TO THE ESTABLISHMENT OF
INSTRUMENTALITIES SUCH AS GOVERNMENT CORPORATIONS, THE CONGRESS INTENDS
TO GRANT THEM A CONSIDERABLE AMOUNT OF AUTONOMY. SEE CHARLES NEASON,
B-195723, SEPTEMBER 10, 1979, 79-2 CPD 184, AND CASES CITED THEREIN.
SINCE OUR OFFICE HAS NO AUTHORITY TO SETTLE AND ADJUST THE ACCOUNTS
OF THE FDIC AND, THEREFORE, WOULD BE UNABLE TO EFFECT REMEDIAL ACTION
EVEN IF WE FOUND IT WARRANTED UNDER RULES GENERALLY APPLICABLE TO
FEDERAL PROCUREMENTS, WE DECLINE TO CONSIDER ANY BID PROTEST RELATIVE TO
FDIC OPERATIONS. CHARLES NEASON, SUPRA.
WE DISMISS THE PROTEST.
B-210490, FEB 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
EVEN THOUGH CONTRACTING AGENCY HAD ISSUED AN RFP FOR AN ELECTRON
MICROSCOPE, WHICH IT THEN CANCELED BEFORE NEGOTIATIONS BEGAN DUE TO AN
IMMINENT LACK OF FUNDING, GAO DOES NOT OBJECT TO THE AGENCY'S SUBSEQUENT
DECISION TO PURCHASE THE ITEM FROM A CONTRACTOR ON A NON-MANDATORY
FEDERAL SUPPLY SCHEDULE, RATHER THAN ISSUE ANOTHER COMPETITIVE
SOLICITATION, SINCE THERE IS NO EVIDENCE THAT THE AGENCY HAD ACTUAL
KNOWLEDGE THAT ANOTHER SOURCE WOULD BE LESS COSTLY, OR OTHERWISE ABUSED
ITS DISCRETION.
AMRAY INC.:
AMRAY INC. PROTESTS THE FEDERAL BUREAU OF INVESTIGATION'S (FBI)
PURCHASE OF AN ELECTRON MICROSCOPE FROM A FEDERAL SUPPLY SCHEDULE
CONTRACTOR UNDER A REQUIREMENTS CONTRACT WITH THE GENERAL SERVICES
ADMINISTRATION (GSA) THAT PERMITS, BUT DOES NOT MANDATE, THE FBI TO
PLACE PURCHASE ORDERS WITH THE CONTRACTOR. AMRAY ALLEGES THAT THE FBI
ORIGINALLY HAD ISSUED A REQUEST FOR PROPOSALS WHICH INCLUDED THE
REQUIREMENT FOR THE ELECTRON MICROSCOPE AND WHICH, AMRAY HAD COMPLAINED,
ESTABLISHED UNDULY RESTRICTIVE AND OTHERWISE IMPROPER SPECIFICATIONS.
AMRAY STATES THAT THE FBI CANCELED THE SOLICITATION BECAUSE IT LACKED
SUFFICIENT TIME TO CONDUCT NEGOTIATIONS AND TO MAKE AN AWARD BEFORE THE
END OF FISCAL YEAR 1982 (WHEN THE AVAILABILITY OF FUNDS FOR THE CONTRACT
PRESUMABLY WOULD EXPIRE). AMRAY COMPLAINS THAT THE FBI SUBSEQUENTLY
REFUSED TO NEGOTIATE WITH THE FIRM, AND INSTEAD PLACED A PURCHASE ORDER
WITH THE SCHEDULE CONTRACTOR.
WE SUMMARILY DENY THE PROTEST.
GSA ENTERS INTO REQUIREMENTS CONTRACTS FOR ITEMS COMMONLY USED BY THE
GOVERNMENT AND LISTS THE CONTRACTORS ON FEDERAL SUPPLY SCHEDULES.
FEDERAL PROPERTY MANAGEMENT REGULATIONS (FPMR) SEC. 101-26.402
(PUBLISHED IN 41 C.F.R. SEC. 101-26.402 (1982)). THE CONTRACTS AND THE
SCHEDULES SPECIFY WHICH AGENCIES MUST ISSUE DELIVERY ORDERS TO
CONTRACTORS LISTED ON A PARTICULAR SCHEDULE (MANDATORY USER AGENCIES)
AND WHICH AGENCIES MAY DO SO (NON-MANDATORY USERS). THE ADMINISTRATOR
OF GENERAL SERVICES IS AUTHORIZED TO TAKE THIS CONTRACTING APPROACH WHEN
HE DETERMINES THAT SO DOING IS ADVANTAGEOUS TO THE GOVERNMENT IN TERMS
OF ECONOMY, EFFICIENCY, OR SERVICE. 40 U.S.C. SEC. 481(A) (SUPP. IV
1980).
WE HAVE BEEN INFORMALLY ADVISED THAT THE FBI IS A NON-MANDATORY USER
OF THE FEDERAL SUPPLY SCHEDULE FOR ELECTRON MICROSCOPES. GSA'S
REGULATIONS STATE THAT SUCH AN AGENCY IS ENCOURAGED TO USE SCHEDULE
CONTRACTS AS A PRIMARY SOURCE OF SUPPLY, EXCEPT WHERE THE AGENCY HAS
"ACTUAL KNOWLEDGE" THAT IT CAN PROCURE THE ITEM AT A PRICE MORE
ADVANTAGEOUS TO THE GOVERNMENT, AFTER ALLOWING FOR THE BURDENS AND COST
OF A NEW PROCUREMENT. FPMR SEC. 101-26.401-5(B).
IN LIGHT OF THIS, WE VIEW THE DECISION WHETHER TO PLACE AN ORDER WITH
A NON-MANDATORY SCHEDULE CONTRACTOR, OR TO PROCEED WITH A SOLICITATION,
AS A BUSINESS JUDGMENT FOR THE CONTRACTING OFFICER, WHICH OUR OFFICE
WILL NOT QUESTION ABSENT A CLEAR SHOWING OF ABUSE OF DISCRETION. SEE
FIRE APPARATUS SERVICE, B-192370, AUGUST 22, 1979, 79-2 CPD 142. AN
ABUSE OF DISCRETION MIGHT EXIST, FOR EXAMPLE, WHERE THE AGENCY PURCHASES
FROM A SCHEDULE CONTRACTOR EVEN THOUGH THE AGENCY KNOWS IT CAN PROCURE
THE ITEM AT A LOWER OVERALL COST. THE MERE FACT, HOWEVER, THAT THE FBI
HAD INITIATED A COMPETITIVE PROCUREMENT, WHICH WAS CANCELED BASICALLY
DUE TO THE IMMINENT EXPIRATION OF FUNDING, PROVIDES NO BASIS FOR THIS
OFFICE TO FIND THAT THE CONTRACTING OFFICER SUBSEQUENTLY ABUSED HIS
DISCRETION BY UTILIZING THE FEDERAL SUPPLY SCHEDULE AS AUTHORIZED BY
GSA. IN THIS REGARD, WE POINT OUT THAT THE CANCELLATION OF A
SOLICITATION IS PROPER WHERE THE LOSS OF FUNDING IS IMMINENT. SEE
A.R.F.PRODUCTS, INC., 56 COMP.GEN. 201 (1976), 76-2 CPD 541; WHAT-MAC
CONTRACTORS, INC., B-190241, MARCH 3, 1978, 78-1 CPD 164.
THE PROTEST IS DENIED.
B-210483, JUN 21, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
CANCELLATION OF SOLICITATION AND RESOLICITATION FOR BARGE DRYDOCKING
AND OVERHAUL WERE PROPER WHERE AGENCY REASONABLY DETERMINED THAT INITIAL
SOLICITATION SPECIFICATIONS DID NOT REFLECT AGENCY'S ACTUAL
REQUIREMENTS.
ATKINSON MARINE CORPORATION:
ATKINSON MARINE CORPORATION (ATKINSON) PROTESTS THE CANCELLATION OF
INVITATION FOR BIDS (IFB) NO. N62791-83-B-0050 AND THE RESOLICITATION OF
THE REQUIREMENTS UNDER IFB NO. N62791-83-B-0072 BY THE SUPERVISOR OF
SHIPBUILDING, CONVERSION AND REPAIR, UNITED STATES NAVY, SAN DIEGO,
CALIFORNIA (NAVY). ATKINSON CONTENDS THAT THE CANCELLATION WAS IMPROPER
AND REQUESTS OUR OFFICE TO REINSTATE THE ORIGINAL IFB AND AWARD THE
CONTRACT TO ATKINSON AS THE LOWEST RESPONSIVE AND RESPONSIBLE BIDDER.
ATKINSON'S PROTEST IS DENIED.
BACKGROUND
THE SUPERVISOR OF SHIPBUILDING, CONVERSION AND REPAIR, ISSUED THE
ORIGINAL IFB ON DECEMBER 15, 1982, FOR THE DRYDOCKING AND OVERHAUL OF
THE YOG-88, A SELFPROPELLED FUEL BARGE ATTACHED TO THE UNITED STATES
NAVAL STATION IN SAN DIEGO. AN AMENDMENT TO THE SOLICITATION PROVIDED
THAT BIDS WOULD BE RECEIVED UNTIL JANUARY 4, 1983.
BIDS WERE OPENED ON JANUARY 4, 1983. TRIPLE "A" SOUTH WAS THE
APPARENT LOW BIDDER AND ATKINSON WAS THE APPARENT SECOND LOW BIDDER. ON
JANUARY 5, 1983, ATKINSON REQUESTED THE CONTRACTING OFFICER TO CONSIDER
TRIPLE "A" SOUTH'S BID NONRESPONSIVE AND TO AWARD THE CONTRACT TO
ATKINSON. ATKINSON ALLEGED THAT TRIPLE "A" SOUTH'S BID WAS CONTINGENT
UPON THE COMPANY'S ABILITY TO REFURBISH ITS DRYDOCK FOR THE OVERHAUL OR
UPON ITS ABILITY TO ARRANGE TO BERTH THE DOCK WITHIN THE SAN DIEGO
UNIFIED PORT DISTRICT.
ALSO, ON JANUARY 5, 1983, THE CONTRACTING OFFICER WAS ADVISED OF THE
NEED FOR SUBSTANTIAL CHANGES TO THE WORK REQUIREMENTS SET FORTH IN THE
IFB. ACCORDINGLY, ON JANUARY 6, 1983, THE CONTRACTING OFFICER DECIDED
TO CANCEL THE EXISTING SOLICITATION AND TO READVERTISE THE PROCUREMENT.
ALL BIDDERS WERE NOTIFIED OF THE CONTRACTING OFFICER'S DECISION;
ATKINSON FILED ITS PROTEST WITH OUR OFFICE ON JANUARY 7, 1983.
THE NEW IFB WAS ISSUED ON JANUARY 21, 1983, AND BIDS WERE OPENED ON
FEBRUARY 3, 1983. TRIPLE "A" SOUTH WAS THE APPARENT LOW RESPONSIVE AND
RESPONSIBLE BIDDER. ON FEBRUARY 11, 1983, AFTER BEING UNABLE TO NOTIFY
OUR OFFICE DUE TO WEATHER CONDITIONS IN WASHINGTON, THE AGENCY AWARDED
THE CONTRACT TO TRIPLE "A," NOTWITHSTANDING THE PENDING PROTEST, BECAUSE
IT BELIEVED THAT A DELAY IN THE COMPLETION OF THE OVERHAUL WOULD
ADVERSELY AFFECT THE POSTOVERHAUL OPERATIONAL COMMITMENTS OF THE YOG-88.
OUR OFFICE WAS INFORMED OF THE CONTRACT AWARD ON FEBRUARY 14, 1983.
ATKINSON'S PROTEST
ATKINSON CONTENDS THAT THE RESOLICITATION WAS IMPROPER AND THAT THE
REASONS CITED FOR THE RESOLICITATION ARE NOT "COMPELLING REASONS" AS
REQUIRED BY APPLICABLE PROCUREMENT REGULATIONS.
THE AGENCY CLAIMS THAT THE RESOLICITATION WAS JUSTIFIED BECAUSE THE
CHANGES IN WORK REQUIREMENTS AND THE REVISIONS TO THE SPECIFICATIONS
WERE CONSIDERABLE AND, FOR THE MOST PART, WOULD HAVE REQUIRED REENTRY
INTO SYSTEMS WHICH WERE INCLUDED IN THE ORIGINAL SOLICITATION. THE NAVY
ESTIMATED THAT THE REVISED REQUIREMENTS WOULD INCREASE THE SCOPE OF THE
WORK BY AS MUCH AS 25 PERCENT AND COULD TAKE AS LONG AS 6 ADDITIONAL
WEEKS TO COMPLETE IF PERFORMED SUBSEQUENT TO THE REQUIREMENTS SET FORTH
IN THE ORIGINAL SOLICITATION.
ATKINSON CONTENDS THAT ITS POSITION IS SUPPORTED BY THE FACTS THAT
(1) THE REVISED SOLICITATION ALLOWED THE SAME AMOUNT OF TIME FOR
PERFORMANCE (134 DAYS) AS DID THE INITIAL SOLICITATION AND (2) NO BID
SUBMITTED IN RESPONSE TO THE REVISED SOLICITATION INCREASED BY MORE THAN
11.7 PERCENT, AN AMOUNT LOWER THAN THE AGENCY'S ESTIMATE OF AS MUCH AS A
25-PERCENT INCREASE.
WE SUPPORT THE AGENCY POSITION THAT ATKINSON'S PROTEST IS WITHOUT
MERIT AND THAT THE NAVY'S CANCELLATION OF THE SOLICITATION IN ORDER TO
REVISE THE SPECIFICATIONS WAS PROPER.
THE DEFENSE ACQUISITION REGULATION (DAR) STATES THAT, AFTER BIDS HAVE
BEEN OPENED, AWARD MUST BE MADE TO THE RESPONSIBLE BIDDER WHO SUBMITS
THE LOWEST RESPONSIVE BID, UNLESS THERE IS A COMPELLING REASON TO REJECT
ALL BIDS AND CANCEL THE INVITATION. DAR SEC. 2-404.1(A) (1976 ED.). A
NUMBER OF REASONS CONSIDERED SUFFICIENTLY COMPELLING TO JUSTIFY
CANCELLATION ARE LISTED, INCLUDING INADEQUATE OR SUBSEQUENTLY REVISED
SPECIFICATIONS CITED IN THE INVITATION. DAR SEC. 2-404.1(B)(I) AND (II)
(1976 ED.).
OUR OFFICE WILL NOT OBJECT TO THE CANCELLATION OF A SOLICITATION
CONTAINING INADEQUATE SPECIFICATIONS WHEN AN AWARD UNDER THAT
SOLICITATION WOULD NOT SATISFY THE GOVERNMENT'S LEGITIMATE NEEDS. A&C
BUILDING AND INDUSTRIAL MAINTENANCE CORPORATION, B-205529, DECEMBER 15,
1981, 81-2 CPD 478. WE HAVE CONSISTENTLY RECOGNIZED THAT GOVERNMENT
PROCUREMENT OFFICIALS ARE GENERALLY IN THE BEST POSITION TO KNOW THE
GOVERNMENT'S NEEDS AND TO DRAFT APPROPRIATE SPECIFICATIONS. SCHOOL FOR
EDUCATIONAL ENRICHMENT, B-199003, OCTOBER 16, 1980, 80-2 CPD 286.
CONTRACTING OFFICERS HAVE BROAD DISCRETION TO DETERMINE WHETHER A
SOLICITATION SHOULD BE CANCELED AND THE CONTRACT REPROCURED, AND WE WILL
NOT OVERTURN SUCH A DECISION UNLESS THERE IS AN ABUSE OF DISCRETION.
APEX INTERNATIONAL MANAGEMENT SERVICES, INC., B-200008, JANUARY 16,
1981, 81-1 CPD 24. ON THE BASIS OF THE FACTS PRESENTED HERE, WE HAVE NO
REASON TO QUESTION THE NAVY'S DETERMINATION THAT THE ADDITIONAL WORK ON
THE YOG-88 WAS NECESSARY OR THE CONTRACTING OFFICER'S DECISION TO
RESOLICIT THE PROCUREMENT.
WE DO NOT BELIEVE THAT ATKINSON'S POSITION THAT THE NAVY LACKED
COMPELLING REASONS TO RESOLICIT IS SUPPORTED BY THE FACT THAT THE
RESOLICITATION DID NOT INCREASE THE AMOUNT OF TIME ALLOWED FOR
PERFORMANCE. THE NAVY BELIEVED THAT THE INCORPORATION OF THE NEW
REQUIREMENTS WITH THE ORIGINAL REQUIREMENTS IN A NEW SOLICITATION WOULD
PERMIT COMPLETION OF ALL WORK WITHIN THE 134 DAYS ORIGINALLY SPECIFIED
SINCE MANY OF THE NEW REQUIREMENTS CALLED FOR WORK ON THE SAME SYSTEMS
AS THE ORIGINAL REQUIREMENTS. THEREFORE, ALTHOUGH THE NAVY DID NOT
INCREASE THE PERFORMANCE TIME BECAUSE OF THE REASONS INDICATED, THE FACT
REMAINS THAT ADDITIONAL WORK WAS ADDED TO THE ORIGINAL SPECIFICATIONS.
WHILE ATKINSON CONTENDS THAT THE BIDS ON THE RESOLICITATION DID NOT
SUBSTANTIATE THE NAVY'S ESTIMATE THAT THE SCOPE OF WORK WOULD INCREASE
BY 25 PERCENT, WE FIND THIS ARGUMENT UNPERSUASIVE. WE HAVE HELD THAT
THE PRICES RESULTING FROM A RESOLICITATION ARE NOT RELEVANT TO A PRIOR,
REASONABLY BASED DETERMINATION TO RESOLICIT. CUSTOM MARINE, INC.,
B-198082, JULY 3, 1980, 80-2 CPD 9. IN THIS CASE, WHETHER THE
ADDITIONAL WORK INCREASED THE COST OF PERFORMANCE BY 25 PERCENT AS
ORIGINALLY ESTIMATED BY THE NAVY OR BY 11 PERCENT AS REFLECTED IN THE
BIDDING, THE FACT REMAINS THAT, AS ANTICIPATED BY THE NAVY, THE
ADDITIONAL WORK ADDED TO THE COST OF PERFORMING THE CONTRACT. THUS, THE
CONTRACTING OFFICER HAD A REASONABLE BASIS TO RESOLICIT THE PROCUREMENT.
THE PROTESTER SUGGESTS THAT THE CONTRACTING OFFICER SHOULD HAVE
AWARDED THE CONTRACT UNDER THE ORIGINAL IFB AND THEN MODIFIED THE
CONTRACT BY REVISING THE SPECIFICATIONS AFTER CONTRACT AWARD. WE DO NOT
AGREE.
MODIFICATIONS TO CONTRACT SPECIFICATIONS ARE PERMITTED WHEN CHANGES
IN THE TERMS OF A CONTRACT BECOME NECESSARY AFTER CONTRACT AWARD.
PRAXIS ASSURANCE VENTURE, B-190200, MARCH 15, 1978, 78-1 CPD 203.
HOWEVER, THE GOVERNMENT IS NOT PERMITTED TO AWARD A CONTRACT WITH THE
INTENTION OF SIGNIFICANTLY MODIFYING IT AFTER AWARD. CENTRAL
MECHANICAL, INC., B-206030, FEBRUARY 4, 1982, 82-1 CPD 91. WHEN THE
NEED FOR SUCH MODIFICATIONS IS KNOWN PRIOR TO CONTRACT AWARD, THE AGENCY
SHOULD CANCEL THE SOLICITATION AND READVERTISE, INCORPORATING THE
REVISED SPECIFICATIONS IN THE NEW SOLICITATION. AMERICAN SHIPBUILDING
COMPANY, B-207218, B-207218.2, NOVEMBER 9, 1982, 82-2 CPD 424. SINCE
THE CONTRACTING OFFICER BECAME AWARE OF THE CHANGED REQUIREMENTS PRIOR
TO CONTRACT AWARD, THE SOLICITATION WAS PROPERLY READVERTISED.
WE HAVE NOT CONSIDERED THE PROTESTER'S ALLEGATIONS THAT ATKINSON, NOT
TRIPLE "A" SOUTH, WAS THE LOWEST RESPONSIVE AND RESPONSIBLE BIDDER UNDER
THE ORIGINAL SOLICITATION SINCE CONSIDERATION OF THAT MATTER IS NOT
RELEVANT TO THE OUTCOME OF THIS DECISION.
B-210482, JUN 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST OF VARIOUS ALLEGED SOLICITATION DEFECTS IS UNTIMELY
BECAUSE IT WAS NOT FILED UNTIL 6 MONTHS AFTER THE CLOSING DATE FOR
RECEIPT OF INITIAL PROPOSALS.
2. CONTENTION THAT PROTEST IS TIMELY FILED BECAUSE PROTESTER, A
JOINT VENTURE, DID NOT LEARN OF THE BASIS OF PROTEST UNTIL A FEW DAYS
PRIOR TO FILING ITS PROTEST WITH GAO, WHEN IT RECEIVED A COPY OF THE
CONTRACT AWARDED THE SUCCESSFUL OFFEROR, IS CONTRADICTED BY THE AGENCY'S
UNCONTESTED STATEMENT THAT A COPY OF THE CONTRACT WAS FURNISHED TO A
PRINCIPAL OF THE JOINT VENTURE MONTHS EARLIER. PROTEST NOT FILED WITHIN
10 WORKING DAYS OF WHEN PROTESTER KNEW OR SHOULD HAVE KNOWN OF BASIS OF
PROTEST IS UNTIMELY.
M-R-C, JOINT VENTURE:
M-R-C, JOINT VENTURE, PROTESTS REQUEST FOR PROPOSALS NO.
F33615-82-R-1714 ISSUED BY THE AERONAUTICAL SYSTEMS DIVISION, AIR FORCE
SYSTEMS COMMAND, WRIGHT PATTERSON AIR FORCE BASE, OHIO FOR CIVIL
ENGINEER SERVICE SUPPORT. M-R-C ASSERTS THAT THE WORK SOLICITED WAS IN
THE NATURE OF CONSTRUCTION RATHER THAN SERVICES AND THAT, CONSEQUENTLY,
THE SOLICITATION SHOULD HAVE INCLUDED CONSTRUCTION-RELATED PROVISIONS,
SUCH AS DAVIS-BACON MINIMUM WAGE RATES, AND THAT THE SOLICITATION WAS
DEFECTIVE IN A NUMBER OF OTHER RESPECTS. THE PROTESTER ALSO ASSERTS
THAT THE AWARDEE WAS IMPROPERLY PERMITTED TO ADJUST ITS PROPOSAL AFTER
THE SUBMISSION OF OFFERS. WE DISMISS THE PROTEST AS UNTIMELY.
THE SOLICITATION WAS ISSUED MAY 18, 1982. INITIAL PROPOSALS WERE
RECEIVED JUNE 30, 1982, AND A CONTRACT AWARDED TO THE SUCCESSFUL
OFFEROR, THE FRED B. DEBRA COMPANY, ON SEPTEMBER 30, 1982. M-R-C'S
PROTEST WAS FILED WITH THIS OFFICE ON JANUARY 13, 1983.
UNDER OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.2 (B)(1)(1983), A
PROTEST OF ALLEGED IMPROPRIETIES IN A SOLICITATION MUST BE FILED PRIOR
TO THE CLOSING DATE FOR RECEIPT OF INITIAL PROPOSALS. ALL OF M-R-C'S
CONTENTIONS REGARDING THE SOLICITATION RELATE TO ALLEGED DEFICIENCIES
WHICH WERE APPARENT ON THE FACE OF THE SOLICITATION. THE EARLIEST THAT
M-R-C RAISED ANY QUESTIONS IN THIS RESPECT WAS MORE THAN 6 MONTHS AFTER
THE CLOSING DATE. BECAUSE THESE ALLEGATIONS WERE NOT RECEIVED BY EITHER
THE AIR FORCE OR THIS OFFICE UNTIL AFTER THE CLOSING DATE FOR RECEIPT OF
INITIAL PROPOSALS, THEY ARE UNTIMELY.
M-R-C ALSO CONTENDS THAT THE AIR FORCE PERMITTED DEBRA TO ADJUST ITS
PROPOSAL AFTER RECEIPT OF OFFERS TO INCLUDE CERTAIN MARK-UPS NOT
CONTEMPLATED BY THE SOLICITATION, AND THAT OTHER OFFERORS WERE NOT
AFFORDED THIS OPPORTUNITY. M-R-C ORIGINALLY ASSERTED THAT IT ONLY
BECAME AWARE OF THIS WHEN IT RECEIVED A COPY OF THE CONTRACT ON JANUARY
5, 1983, IN REPLY TO A FREEDOM OF INFORMATION ACT REQUEST AND THAT,
CONSEQUENTLY, ITS PROTEST RECEIVED BY OUR OFFICE ON JANUARY 13, 1983 IS
TIMELY WITH RESPECT TO THIS ALLEGATION. IN ITS SUBSEQUENT REPORT ON THE
PROTEST, HOWEVER, THE AIR FORCE STATES THAT MESSER CONSTRUCTION, A
PRINCIPAL OF M-R-C, JOINT VENTURE WAS PROVIDED A COPY OF THE AWARDED
CONTRACT NEARLY 3 MONTHS EARLIER, ON OCTOBER 14, 1982. M-R-C HAS NOT
CONTESTED THIS STATEMENT.
OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.2(B)(2), STATE THAT A
PROTEST WHICH INVOLVES OTHER THAN SOLICITATION IMPROPRIETIES MUST BE
RECEIVED BY EITHER THE CONTRACTING AGENCY OR OUR OFFICE WITHIN 10
WORKING DAYS AFTER THE BASIS OF THE PROTEST IS KNOWN OR SHOULD HAVE BEEN
KNOWN. AS NOTED, M-R-C'S PROTEST WAS FILED NEARLY 3 MONTHS AFTER A
PRINCIPAL OF THE JOINT VENTURE RECEIVED A COPY OF THE CONTRACT UPON
WHICH THIS ASPECT OF ITS PROTEST IS BASED. WE VIEW THIS AS NOTICE TO
BOTH THE PRINCIPAL AND THE JOINT VENTURE REGARDING THE TERMS OF THE
AWARDED CONTRACT AND, CONSEQUENTLY, THIS PART OF M-R-C'S PROTEST IS
UNTIMELY.
FINALLY, M-R-C CONTENDS THAT EVEN IF ITS PROTEST IS UNTIMELY, IT
SHOULD BE CONSIDERED UNDER THE "SIGNIFICANT ISSUE" EXCEPTION TO OUR
TIMELINESS RULES, 4 C.F.R. SEC. 21.2(C).
WE DO NOT AGREE. THIS EXCEPTION MUST BE STRICTLY CONSTRUED AND
SPARINGLY USED TO PREVENT OUR TIMELINESS RULES FROM BEING RENDERED
MEANINGLESS. CONSEQUENTLY, TO BE CONSIDERED SIGNIFICANT, THE ISSUE IN
PROTEST MUST BE A MATTER OF WIDESPREAD INTEREST TO THE PROCUREMENT
COMMUNITY WHICH HAS NOT BEEN THE SUBJECT OF PRIOR GAO DECISIONS. SEE 52
COMP.GEN. 20, 23 (1972). WHILE THE PROTESTER ARGUES MANY POINTS, NONE
HAS BEEN SHOWN TO SATISFY THIS TEST. ACCORDINGLY, WE SEE NO BASIS FOR
CONSIDERING THE PROTEST UNDER THE SIGNIFICANT ISSUE EXCEPTION TO OUR
TIMELINESS RULES.
THE PROTEST IS DISMISSED.
B-210480, FEB 18, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE APPROPRIATIONS ACT CONTAINS PROHIBITION AGAINST GSA OBLIGATING
OR EXPENDING FUNDS TO CONTRACT FOR CUSTODIAL SERVICES, PROTEST AGAINST
CANCELLATION OF SOLICITATION FOR THESE SERVICES IS DISMISSED AS ACADEMIC
SINCE AWARD COULD NOT BE MADE UNDER THE SOLICITATION BECAUSE OF THE
PROHIBITION.
BOMPART CLEANING SERVICE:
BOMPART CLEANING SERVICE (BOMPART) PROTESTS THE CANCELLATION OF
INVITATION FOR BIDS (IFB) NO. 82-09-035, ISSUED BY THE GENERAL SERVICES
ADMINISTRATION (GSA) FOR CUSTODIAL CLEANING SERVICES AT THE FEDERAL
BUILDING/UNITED STATES COURTHOUSE, HELENA, MONTANA.
WE DISMISS THE PROTEST.
PUBLIC LAW 97-377, ENACTED ON DECEMBER 21, 1982, CONTAINED A
PROHIBITION AGAINST GSA OBLIGATING OR EXPENDING FUNDS TO CONTRACT FOR
SERVICES WHICH PRIOR TO THE ENACTMENT OF THE ACT HAD BEEN PERFORMED BY
GSA EMPLOYEES IN POSITIONS DESCRIBED IN SECTION 3310 OF TITLE 5, UNITED
STATES CODE, WHICH REFERS TO GUARDS, ELEVATOR OPERATORS, AND CUSTODIANS.
THE SERVICES SOLICITED BY IFB NO. 82-09-035 HAD, PRIOR TO THE ENACTMENT
OF PUBLIC LAW NO. 97-377, BEEN PERFORMED BY GSA EMPLOYEES AND IT WAS FOR
THIS REASON THAT GSA CANCELED THE SOLICITATION.
BOMPART CONTENDS THAT GSA'S DECISION TO CANCEL THE SOLICITATION IS
CONTRARY TO THE POLICY OF THE GENERAL ACCOUNTING OFFICE (GAO) TO
RECOMMEND THE CONTRACTING OUT FOR SUCH SERVICES AND CIRCUMVENTS OFFICE
OF MANAGEMENT AND BUDGET (OMB) CIRCULAR A-76.
THE PROHIBITION AGAINST GSA CONTRACTING FOR CUSTODIAL SERVICES
RENDERS THE PROTEST ACADEMIC BECAUSE GSA COULD NOT REINSTATE THE
SOLICITATION AND AWARD A CONTRACT UNDER THE SOLICITATION. SEE
INTERNATIONAL BUSINESS INVESTMENTS, B-209051, JANUARY 10, 1983, 83-1 CPD
, AND INTER-CON SECURITY SYSTEMS, INC., B-208551, JANUARY 26, 1983, 83-1
CPD .
THE PROTEST IS ACCORDINGLY DISMISSED.
B-210479, DEC 30, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
THREE EMPLOYEES OF THE FOREST SERVICE
SEEK REIMBURSEMENT FOR REGISTRATION FEES
WHICH REPRESENTED THE COST OF MEALS AT
LUNCHEON MEETINGS ATTENDED BY THEM AS
COMBINED FEDERAL CAMPAIGN WORKERS AND
LOANED EXECUTIVES AUTHORIZED BY 5 C.F.R. SEC. 950.509(K).
REIMBURSEMENT MAY NOT BE
ALLOWED. UNDER PROVISIONS OF 5 U.S.C. SEC. 4110,
TO THE EXTENT THAT SUCH EXPENSES
MAY BE REIMBURSED FROM APPROPRIATED FUNDS,
SUCH REIMBURSEMENT IS LIMITED TO SITUATIONS
INVOLVING FUNCTIONS AND ACTIVITIES
OF THE AGENCY. THE MEETINGS HERE INVOLVED
DO NOT CONCERN A FUNCTION OR ACTIVITY OF
THE FOREST SERVICE FOR WHICH THE CLAIMANTS
WERE EMPLOYED OR FOR WHICH THE AGENCY
APPROPRIATIONS WERE MADE. B-195045,
FEBRUARY 8, 1980.
SANDRA L. FERGERSON, JEFF M. SIRMON, AND KENNETH J. JOHNSON -
REIMBURSEMENT FOR REGISTRATION FEE AND LUNCHEON - COMBINED FEDERAL
CAMPAIGN:
THIS DECISION IS IN RESPONSE TO A REQUEST FROM AN AUTHORIZED
CERTIFYING OFFICER OF THE U.S. DEPARTMENT OF AGRICULTURE, FOREST
SERVICE, CONCERNING THE ENTITLEMENT OF THREE OF ITS EMPLOYEES TO BE
REIMBURSED FOR REGISTRATION FEES AND LUNCHEON MEAL EXPENSES INCURRED IN
CONNECTION WITH THE 1982-83 COMBINED FEDERAL CAMPAIGN (CFC). FOR
REASONS THAT FOLLOW, THE THREE EMPLOYEES IN QUESTION MAY NOT BE
REIMBURSED THE COST OF THESE LUNCHEONS.
MS. SANDRA L. FERGERSON WAS DETAILED TO THE CFC AS AN EXECUTIVE UNDER
THE LOANED EXECUTIVE PROGRAM (5 C.F.R. SEC. 950.509(K)). UNDER THOSE
REGULATIONS, FEDERAL EMPLOYEES DETAILED AS EXECUTIVES TO THE CFC ARE
PLACED ON ADMINISTRATIVE LEAVE.
DURING THE COURSE OF THE CAMPAIGN, THE GROUP TO WHICH MS. FERGERSON
WAS ASSIGNED HELD LUNCHEON MEETINGS EACH FRIDAY AT VARIOUS LOCATIONS
THROUGHOUT THE PORTLAND, OREGON, AREA FOR THE SOLE PURPOSE OF DISCUSSING
CFC BUSINESS. THESE LUNCHEONS WERE SCHEDULED, ATTENDED AND CONTROLLED
BY THE CFC ORGANIZATION. APPARENTLY, PARTICIPATION IN THESE LUNCHEON
MEETINGS WAS CONSIDERED ESSENTIAL TO ACHIEVING THE OVERALL MANAGEMENT
AND ADMINISTRATIVE OBJECTIVES OF THE CFC. IN ADDITION TO THESE
MEETINGS, FEDERAL EMPLOYEES DETAILED UNDER THE LOANED EXECUTIVE PROGRAM,
ALONG WITH THEIR COUNTERPARTS FROM NON-FEDERAL ORGANIZATIONS,
PARTICIPATED IN UNITED WAY CAMPAIGN "REPORT LUNCHEONS" EACH WEDNESDAY TO
DETERMINE THE PROGRESS BEING MADE BY THE VARIOUS CFC AND OTHER GROUPS.
THESE LUNCHEON MEETINGS ARE SPONSORED AND ADMINISTRATIVELY MANAGED BY
THE UNITED WAY CAMPAIGN STAFF. IT IS INDICATED THAT, WHILE
PARTICIPATION IN THESE VARIOUS LUNCHEONS WAS REQUIRED ON THE PART OF ALL
SUCH EXECUTIVES, SUCH REQUIREMENT WAS IMPOSED BY THE CFC AND UNITED WAY
ORGANIZATIONS.
ALSO, TWO OTHER FOREST SERVICE EMPLOYEES, MR. JEFF M. SIRMON AND MR.
KENNETH J. JOHNSON, ATTENDED THE FEDERAL EXECUTIVE BOARD SPONSORED CFC
KICK-OFF LUNCHEON IN SEPTEMBER 1982. IN ADDITION, MR. JOHNSON AND MS.
FERGERSON ATTENDED THE CFC AWARDS LUNCHEON IN NOVEMBER 1982. IN EACH
INSTANCE, THE EMPLOYEE PAID A REGISTRATION FEE TO ATTEND THE LUNCHEON.
THE RECEIPT GIVEN EACH CONTAINED THE NOTATION "REGISTRATION FEE. MEAL
IS INCIDENTAL TO THE MEETING AND ATTENDANCE IS NECESSARY FOR FULL
PARTICIPATION." HOWEVER, IT IS INDICATED THAT LITTLE OR NONE OF THE
CHARGES RELATED TO ANY EXPENSES ASSOCIATED WITH THE MEETING OTHER THAN
THE COST OF THE MEAL.
BASED ON THE FOREGOING, THE FOLLOWING QUESTIONS ARE ASKED:
"(1) WHAT EFFECT OR BEARING, IF ANY,
DOES THE FACT THAT A MEETING IS AN 'ADMINISTRATIVELY
CONTROLLABLE EVENT' AND WITHIN THE
PURVIEW OF AN AGENCY'S DISCRETION HAVE ON THE
LEGITIMACY OF A MEETING AS A FUNCTION UNDER
WHICH MEALS COULD BE REIMBURSED?
"(2) RELATEDLY, DOES THE FACT THAT A
MEETING IS SPONSORED BY AN EXTERNAL ORGANIZATION
AND THUS BEYOND THE ADMINISTRATIVE CONTROL
OF THE AGENCY HAVE ANY BEARING ON THE
INCIDENT TO THE DAY-TO-DAY OPERATIONS OF THE
CAMPAIGN TO WHICH THE EMPLOYEES HAVE BEEN
ASSIGNED?"
THE STATUTORY PROVISION GOVERNING THESE MATTERS IS CONTAINED IN 5 U.
S.C. SEC. 4110 (1976), WHICH PROVIDES THAT:
"APPROPRIATIONS AVAILABLE TO AN AGENCY
FOR TRAVEL EXPENSES ARE AVAILABLE FOR
EXPENSES OF ATTENDANCE AT MEETINGS WHICH ARE
CONCERNED WITH THE FUNCTIONS OR ACTIVITIES
FOR WHICH THE APPROPRIATION IS MADE OR WHICH
WILL CONTRIBUTE TO IMPROVED CONDUCT, SUPERVISION,
OR MANAGEMENT OF THE FUNCTIONS OR
ACTIVITIES."
WE START WITH THE GENERAL RULE THAT AN EMPLOYEE MAY NOT BE PAID A PER
DIEM ALLOWANCE OR ACTUAL SUBSISTENCE EXPENSES AT HIS PERMANENT DUTY
STATION AS SUCH EXPENSES ARE CONSIDERED PERSONAL TO THE EMPLOYEE.
PARAGRAPH 1-7.6A, FEDERAL TRAVEL REGULATIONS, FPMR 101-7, (SEPTEMBER
1981). WE HAVE CONSISTENTLY HELD THAT IN THE ABSENCE OF SPECIFIC
STATUTORY AUTHORITY, THE GOVERNMENT MAY NOT PAY SUBSISTENCE EXPENSES OR
FURNISH FREE MEALS TO EMPLOYEES AT THEIR OFFICIAL DUTY STATION EVEN
WHERE UNUSUAL WORKING CONDITIONS ARE INVOLVED. 53 COMP.GEN. 457 (1974);
42 COMP.GEN. 149 (1962); AND J.D. MACWILLIAMS, B-200650, AUGUST 12,
1981. COMPARE 53 COMP.GEN. 71 (1973).
NOTWITHSTANDING THAT LIMITATION, WE HAVE HELD THAT UNDER 5 U.S.C.
SEC. 4110, REGISTRATION FEES FOR ATTENDANCE BY EMPLOYEES AT MEETINGS
HELD AT THEIR OFFICIAL DUTY STATION, WHERE MEALS ARE INCLUDED IN THE FEE
AT NO ADDITIONAL CHARGE AND REPRESENT AN INCIDENTAL PART OF THE MEETING
ARE PROPERLY FOR PAYMENT. 38 COMP.GEN. 134 (1958); B-166560, FEBRUARY
3, 1970; AND B-160579, APRIL 26, 1978.
IN CASES WHERE MEALS ARE NOT INCLUDED IN A REGISTRATION FEE FOR
ATTENDANCE AT SUCH A MEETING, AND A SEPARATE CHARGE IS MADE, WE HAVE
HELD THAT IN ORDER TO BE REIMBURSED, THREE CONDITIONS MUST BE MET: (1)
THERE MUST BE A SHOWING THAT THE MEAL OR MEALS WERE INCIDENTAL TO THE
MEETING; (2) THAT THE ATTENDANCE BY THE EMPLOYEE AT THE MEAL WAS
NECESSARY TO FULL PARTICIPATION IN THE MEETING; AND (3) THAT THE
EMPLOYEE WAS NOT FREE TO PARTAKE OF HIS MEALS ELSEWHERE WITHOUT HAVING
BEEN ABSENT FROM ESSENTIAL BUSINESS OF THE MEETING. GERALD GOLDBERG, ET
AL., B-198471, MAY 1, 1980.
THE UNDERLYING FACT IN ALL OF THESE CASES IS THAT THE EVENTS IN
QUESTION CONCERN A FUNCTION OR ACTIVITY FOR WHICH THE PARTICULAR
AGENCY'S APPROPRIATIONS ARE MADE OR WILL CONTRIBUTE TO THOSE FUNCTIONS
OR ACTIVITIES.
THEREFORE, AS WE VIEW THE MATTER, REIMBURSEMENT IS NOT DEPENDENT ON
WHETHER THE MEALS IN QUESTION ARE ASSOCIATED WITH AN ADMINISTRATIVELY
CONTROLLABLE EVENT BY THE EMPLOYEE'S AGENCY OR THE COMBINED EFFORT OF
ANY AGENCIES. THE FOCUS IS WHETHER THE EXPENSES FOR WHICH REIMBURSEMENT
IS SOUGHT COME WITHIN THE APPROPRIATION PARAMETERS ESTABLISHED UNDER 5
U.S.C. SEC. 4110 (1976).
IN GENTRY BROWN, ET AL., B-195045, FEBRUARY 8, 1980, WE WERE FACED
WITH ESSENTIALLY THE SAME ISSUE PRESENTED HERE. THERE, THREE EMPLOYEES
OF THE COMMUNITY SERVICES ADMINISTRATION REQUESTED REIMBURSEMENT FOR A
CFC LUNCHEON MEETING HELD IN 1978 BY THE FEDERAL EXECUTIVE BOARD OF
GREATER KANSAS CITY, MISSOURI. THERE ALSO, THE REGISTRATION FEE
CONSISTED PRIMARILY OF THE COST OF THE LUNCHEON. WE HELD THAT THE FEE
IN QUESTION COULD NOT BE CONSIDERED A REGISTRATION FEE FOR REIMBURSEMENT
PURPOSES AND THAT THE CFC MEETING DID NOT CONCERN A FUNCTION OR ACTIVITY
OF THE COMMUNITY SERVICES ADMINISTRATION FOR WHICH THE CLAIMANTS WERE
EMPLOYED OR THE PURPOSE FOR WHICH AN APPROPRIATION WAS MADE TO THE
AGENCY.
WITH REGARD TO THE CLAIMED EXPENSES OF JEFF H. SIRMON, KENNETH J.
JOHNSON AND SANDRA L. FERGERSON, WHILE IT IS EVIDENT FROM THE FACTS THAT
THE LUNCHEON MEETINGS WHICH THEY ATTENDED INVOLVED ESSENTIAL CFC AND
UNITED WAY BUSINESS, SUCH MEETINGS DID NOT RELATE TO THE FUNCTION AND
PURPOSE FOR WHICH THE FOREST SERVICE WAS ESTABLISHED OR THE PURPOSE FOR
WHICH THEIR APPROPRIATION WAS MADE. THEREFORE, IN VIEW OF THE STATUTORY
LANGUAGE OF 5 U.S.C. SEC. 4110, THE EXPENSES CLAIMED MAY NOT BE ALLOWED.
IN CONNECTION WITH THE FOREGOING, DURING OUR EXAMINATION AND
CONSIDERATION OF THESE CLAIMS, WE LEARNED THAT IN SOME CITIES, E.G.,
WASHINGTON, D.C., THAT CFC VOLUNTEERS DO NOT INCUR PERSONAL EXPENSES
SUCH AS ARE INVOLVED HERE. APPARENTLY, LOCAL CFC ORGANIZATIONS HAVE
DECIDED THAT LUNCHEON EXPENSES AT SUCH MEETINGS WOULD BE BORNE BY THE
ORGANIZATION.
B-210476, MAR 6, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
GAO HAS NO BASIS TO DISTURB AGENCY'S
DETERMINATION THAT PROTESTER HAS NOT
SUPPLIED SUFFICIENT INFORMATION FROM WHICH
THE AGENCY COULD EVALUATE THE FUNCTIONAL
EQUIVALENCE OF THE PROTESTER'S EQUIPMENT
WITH THE EQUIPMENT SOLICITED, WHERE
AGENCY REQUESTED SPECIFIC INFORMATION ON
EQUIPMENT PROTESTER OFFERED IN RESPONSE
TO SOLE-SOURCE SOLICITATION AND PROTESTER
FAILED TO SUPPLY ALL THE REQUESTED DATA
AND WHERE THE DATA ACTUALLY SUBMITTED DID
NOT CLEARLY SHOW INTERCHANGEABILITY.
AUTOMATED PRODUCTION EQUIPMENT CORPORATION:
AUTOMATED PRODUCTION EQUIPMENT CORPORATION (APE) PROTESTS THE
SOLE-SOURCE AWARD OF A CONTRACT TO PACE INCORPORATED TO PROVIDE 17 PACE
PRC-350C SPIKE-FREE BENCH-TOP REPAIR CENTERS (USED TO REPAIR PRINTED
CIRCUIT BOARDS) UNDER REQUEST FOR PROPOSALS (RFP) NO. DAAG38-82-R-0040,
ISSUED BY THE TOBYHANNA ARMY DEPOT. APE CONTENDS THAT THE SOLICITATION
WAS IMPROPERLY RESTRICTED TO PACE AND THAT THE ARMY INCORRECTLY
EVALUATED AND REJECTED THE EQUIPMENT APE PROPOSED. WE DENY THE PROTEST.
ALTHOUGH THE SOLICITATION WAS ISSUED ON A SOLE-SOURCE BASIS TO PACE,
APE REQUESTED AND WAS FURNISHED A COPY OF THE SOLICITATION. THE ARMY
STATES THAT WHEN IT PROVIDED APE THE SOLICITATION, IT EXPLAINED THAT THE
PACE EQUIPMENT SOLICITED WAS TO BE USED IN THE ARMY'S AN/MSM-105 SYSTEMS
- EACH SYSTEM CONSISTING OF TWO TRAILER TRUCKS USED AS MOBILE TESTING
AND REPAIR FACILITIES FOR VARIOUS ELECTRONIC COMPONENTS. THE AGENCY
FURTHER EXPLAINED THAT IT INTENDED TO MAKE A SOLE-SOURCE AWARD TO PACE
BECAUSE THAT FIRM'S EQUIPMENT HAD BEEN USED BY THE ARMY TO TRAIN ITS
REPAIR TECHNICIANS AND ANY EQUIPMENT CHANGE WOULD REQUIRE REVISION TO
TRAINING COURSES AND MANUALS, THUS UNREASONABLY DELAYING TRAINING AND
THE DEPLOYMENT OF THE AN/MSM-105 SYSTEMS. IN RESPONSE, THE AGENCY
REPORTS, APE STATED IT COULD SUPPLY EQUIPMENT WHICH WAS INTERCHANGEABLE
WITH THE PACE EQUIPMENT AND ITS USE WOULD NOT RESULT IN A DELAY IN
DEPLOYING THE TEST AND REPAIR SYSTEMS. APE THEN SUBMITTED A PROPOSAL
INCLUDING SOME DOCUMENTATION USED BY ANOTHER GOVERNMENT AGENCY IN
APPROVING APE'S EQUIPMENT, APE DESCRIPTIVE LITERATURE AND PRICE LISTS
AND A STATEMENT THAT ALL OF THE APE EQUIPMENT TO BE FURNISHED UNDER THE
SOLICITATION WOULD BE INTERCHANGEABLE WITH THE PACE EQUIPMENT.
THE ARMY EVALUATED APE'S DATA AND FOUND IT WAS NOT SUFFICIENTLY
DETAILED TO PERMIT A COMPARISON OF APE'S EQUIPMENT WITH THE PACE
EQUIPMENT. THE ARMY THUS REQUESTED MORE DETAILED DATA FROM APE. APE
RESPONDED BY PROVIDING ITS PORTABLE REWORK SYSTEM 425AF MANUAL TO
DEMONSTRATE THE INTERCHANGEABILITY OF THE APE EQUIPMENT. THIS MANUAL
INCLUDED INFORMATION ON ADAPTING PACE TOOLS TO OPERATE ON THE APE POWER
SOURCE. THE ARMY FOUND THIS DATA "INSUFFICIENT TO TECHNICALLY EVALUATE
THE ALTERNATE SOURCE OF SUPPLY" AND AGAIN REQUESTED TECHNICAL DATA FROM
APE SPECIFICALLY ASKING FOR DATA SUCH AS MANUFACTURING DRAWINGS FOR EACH
ITEM, QUALITY INSTRUCTION MANUALS AND/OR A TYPICAL SPECIFICATION. THE
ARMY ALSO NOTED THAT THE MODIFICATION NEEDED TO USE PACE TOOLS WITH THE
APE POWER SOURCE DESCRIBED IN APE'S MANUAL WAS UNSATISFACTORY AS IT DID
NOT PERMIT THE MODIFIED PACE TOOLS TO BE USED WITH THE PACE POWER UNIT.
APE REPLIED BY STATING IT HAD SUBMITTED THE BROCHURES NECESSARY FOR A
SIDE-BY-SIDE COMPARISON OF EACH ITEM AND BY EXPLAINING ITS VIEW THAT THE
TOOLS COULD BE MADE TO OPERATE ON BOTH APE AND PACE POWER UNITS.
SUBSEQUENTLY, AN APE REPRESENTATIVE MET WITH ARMY PERSONNEL TO SUBMIT
ADDITIONAL DATA AND TO ATTEMPT TO DEMONSTRATE THE INTERCHANGEABILITY OF
THE APE EQUIPMENT. ALTHOUGH THE RECORD SHOWS THAT THE ARMY TECHNICAL
PERSONNEL WERE IMPRESSED WITH THE DEMONSTRATION OF APE EQUIPMENT, THEY
STILL DID NOT VIEW THE DATA SUBMITTED AS ADEQUATE TO SHOW THE
INTERCHANGEABILITY OF THE EQUIPMENT. THE ARMY INFORMED APE THAT "THE
INFORMATION YOU HAVE FURNISHED HAS BEEN THOROUGHLY EVALUATED AND HAS
BEEN FOUND TO BE INADEQUATE FOR FURTHER EVALUATION" AND AWARDED THE
CONTRACT TO PACE.
APE VIEWS THE REJECTION OF ITS PROPOSALS AS IMPROPER BECAUSE IT
BELIEVES THAT IT SUBMITTED INFORMATION TO THE ARMY SHOWING THAT ITS
EQUIPMENT WAS INTERCHANGEABLE WITH THE PACE EQUIPMENT, THAT IT ACTUALLY
DEMONSTRATED SUCH INTERCHANGEABILITY DURING THE MEETING WITH THE ARMY,
AND BECAUSE ITS EQUIPMENT ALREADY HAS BEEN ACCEPTED AS EQUAL TO PACE'S
EQUIPMENT BY OTHER CONTRACTING ACTIVITIES.
THE ARMY'S POSITION IS THAT APE DID NOT PROVIDE ALL THE INFORMATION
REQUESTED BY THE ARMY AND THAT THE INFORMATION IT DID PROVIDE WAS
INSUFFICIENT TO SHOW THE INTERCHANGEABILITY OF ITS EQUIPMENT. THE ARMY
ALSO STATES THAT APE COULD NOT HAVE DEMONSTRATED INTERCHANGEABILITY AND
FUNCTIONAL EQUIVALENCE WHEN IT MET WITH THE ARMY BECAUSE ALL THE
NECESSARY PACE EQUIPMENT WAS NOT AVAILABLE AT THAT MEETING.
THE PROCURING AGENCY IS RESPONSIBLE FOR EVALUATING THE DATA SUPPLIED
BY AN OFFEROR AND ASCERTAINING IF IT PROVIDES SUFFICIENT INFORMATION TO
DETERMINE THE ACCEPTABILITY OF THE OFFEROR'S ITEM. SEE FIL-COIL
COMPANY, INC., B-198055, JUNE 11, 1980, 80-1 CPD 409. WE WILL NOT
DISTURB THIS TECHNICAL DETERMINATION BY THE AGENCY UNLESS IT IS SHOWN TO
BE UNREASONABLE. THE FACT THAT THE PROTESTER DOES NOT AGREE WITH THE
AGENCY'S TECHNICAL EVALUATION DOES NOT IN ITSELF RENDER THAT EVALUATION
UNREASONABLE. PANASONIC INDUSTRIAL COMPANY, B-207852.2, APRIL 12, 1983,
83-1 CPD 379.
THE RECORD SHOWS THAT THE ARMY REQUESTED SPECIFIC DATA FROM APE ON
SEVERAL OCCASIONS SO THAT IT COULD EVALUATE APE'S EQUIPMENT FOR
FUNCTIONAL EQUIVALENCE WITH THE PACE EQUIPMENT. WHILE THE PROTESTER DID
PROVIDE SOME INFORMATION, APE DOES NOT DISPUTE THAT IT FAILED TO PROVIDE
THE MANUFACTURING DRAWINGS, QUALITY INSTRUCTION MANUALS OR TYPICAL
SPECIFICATIONS THAT WERE REQUESTED.
THE ARMY MAINTAINS THAT THE INFORMATION WHICH APE SUBMITTED DID NOT
PERMIT IT TO EVALUATE APE'S SYSTEM. FOR EXAMPLE, THE AGENCY QUESTIONS
WHETHER APE EQUIPMENT PROVIDES ADEQUATE PROTECTION FROM VOLTAGE SPIKES -
SUDDEN BRIEF SURGES IN VOLTAGE - WHICH MAY SERIOUSLY DAMAGE SENSITIVE
STATE-OF-THE-ART ELECTRIC COMPONENTS. ALTHOUGH APE STATES THAT THE
SYSTEM OFFERED WILL MEET THE AGENCY'S REQUIREMENTS, IT WAS INCUMBENT
UPON APE AS THE OFFEROR TO FURNISH THE INFORMATION WHICH THE ARMY
REQUESTED IN ORDER TO EVALUATE ITS PROPOSAL.
OUR EXAMINATION OF THE RECORD INDICATES THAT THE ONLY EVIDENCE APE
OFFERED WITH RESPECT TO THE VOLTAGE SPIKE QUESTION WAS AN UNEXPLAINED
ONE PAGE TEST REPORT ENTITLED "ZVS VOLTAGE SPIKE TEST" WHICH APPEARS TO
HAVE BEEN AT BEST AMBIGUOUS. THE REPORT STATES THAT THE EQUIPMENT
TESTED WAS FOUND TO HAVE EXHIBITED AN AVERAGE VOLTAGE SPIKE OF .01
VOLTS, MAXIMUM POSITIVE SPIKE VOLTAGE OF .003 VOLTS AND A MAXIMUM
NEGATIVE SPIKE OF .001 VOLTS. THESE NUMBERS APPEAR TO BE INCONSISTENT,
SINCE THE AVERAGE SHOULD FALL BETWEEN THE MAXIMUM POSITIVE AND NEGATIVE
VALUES. SINCE APE FURNISHED NO MATERIAL EXPLAINING THE TEST METHODOLOGY
USED, IT IS IMPOSSIBLE TO DETERMINE WHAT THE NUMBERS IN THE REPORT
REPRESENT OR WHETHER APE'S EQUIPMENT COULD BE EXPECTED TO MINIMIZE
VOLTAGE SPIKE PROBLEMS AS WELL AS PACE'S EQUIPMENT WHEN USED IN THE
FIELD. IN THE CIRCUMSTANCES, WE DO NOT BELIEVE THAT THE ARMY ACTED
UNREASONABLY IN CONCLUDING THAT IT WAS UNABLE TO JUDGE THE
INTERCHANGEABILITY OF APE'S EQUIPMENT FROM THE DATA SUBMITTED.
SIMILARLY, WE HAVE NO BASIS TO QUESTION THE AGENCY'S POSITION THAT IT
WAS UNABLE TO DETERMINE INTERCHANGEABILITY BASED ON THE DEMONSTRATION.
THE FACT THAT APE'S EQUIPMENT HAS BEEN USED BY OTHER ACTIVITIES IS
NOT NECESSARILY DETERMINATIVE OF THE QUESTION PRESENTED HERE. ONE
PROCURING ACTIVITY'S ACCEPTANCE OF AN ITEM AS MEETING ITS NEEDS IS NOT
NECESSARILY DETERMINATIVE OF THE PROPRIETY OF ANOTHER PROCURING
ACTIVITY'S EVALUATION OF THAT SAME ITEM. SEE SAVE-ON WHOLESALE
PRODUCTS, B-194510, JULY 5, 1979, 79-2 CPD 9.
THE PROTEST IS DENIED.
B-210474, AUG 29, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
TRANSFERRED EMPLOYEE, WHO PURCHASED A 100-ACRE
PARCEL OF LAND INCLUDING A 5-ACRE
RESIDENCE SITE, MAY NOT INCLUDE AN ADDITIONAL
1-1/2 ACRES FOR AN ACCESS ROAD
ACROSS THE REMAINDER OF HIS PROPERTY TO
DETERMINE HOW MUCH ACREAGE REASONABLY
RELATES TO THE RESIDENCE SITE FOR THE
PURPOSE OF DETERMINING HIS ENTITLEMENT TO
PRO RATA REIMBURSEMENT OF REAL ESTATE
PURCHASE EXPENSES. HOWEVER, HIS 5-ACRE
RIVERFRONT RESIDENCE SITE IS WORTH MORE
THAN THE AVERAGE 5-ACRE PARCEL OF LAND IN
THE COUNTY AND HIS PRO RATA REIMBURSEMENT
FOR FEES ASSESSED ON THE BASIS OF THE
PURCHASE PRICE SHOULD BE BASED ON THE
HIGHER VALUE OF COMPARABLE RIVERFRONT
PROPERTIES.
JOHN F. STANTON:
THIS ACTION IS IN RESPONSE TO A REQUEST BY AN AUTHORIZED CERTIFYING
OFFICER AT THE DEPARTMENT OF THE AIR FORCE FOR AN ADVANCE DECISION ON
THE RECLAIM VOUCHER OF MR. JOHN F. STANTON FOR REIMBURSEMENT OF REAL
ESTATE EXPENSES INCURRED INCIDENT TO A PERMANENT CHANGE OF DUTY STATION.
THIS MATTER WAS FORWARDED THROUGH THE PER DIEM, TRAVEL AND
TRANSPORTATION ALLOWANCE COMMITTEE AND HAS BEEN ASSIGNED PDTATAC CONTROL
NO. 83-3.
MR. STANTON, AN EMPLOYEE OF THE DEPARTMENT OF THE AIR FORCE, WAS
TRANSFERRED FROM TYNDALL AIR FORCE BASE, FLORIDA, TO WASHINGTON, D.C.,
IN JULY OF 1981. IN CONNECTION WITH THAT TRANSFER HE PURCHASED A
100-ACRE PARCEL OF LAND IN KING GEORGE COUNTY, VIRGINIA, ON WHICH HE
PLACED A MOBILE HOME. MR. STANTON INITIALLY SUBMITTED A CLAIM FOR
REIMBURSEMENT OF REAL ESTATE PURCHASE EXPENSES IN THE AMOUNT OF $5,757.
THE AGENCY DETERMINED THAT 5 OF THE 100 ACRES, HAVING A VALUE EQUAL TO
LESS THAN 1/10 OF THE PURCHASE PRICE OF THE LAND RELATED TO THE
RESIDENCE SITE. BASED ON THIS DETERMINATION THE AGENCY APPROVED PRO
RATA REIMBURSEMENT IN THE AMOUNT OF $677. MR. STANTON WAS NOT PAID THAT
AMOUNT BUT HAS REVISED HIS CLAIM FOR REAL ESTATE EXPENSES AND HAS
RECLAIMED $3,731 IN EXPENSES. IT IS THIS RECLAIM VOUCHER UPON WHICH AN
ADVANCE DECISION IS REQUESTED.
AT THE OUTSET WE NOTE THAT THE AGENCY AND THE EMPLOYEE DISAGREE ON
THE AMOUNT OF LAND UPON WHICH REIMBURSEMENT IS TO BE BASED AND VALUE OF
THE RESIDENTIAL PORTION OF THE PROPERTY.
THE FEDERAL TRAVEL REGULATIONS (FTR) (FPMR 101-7, MAY 1973,
APPLICABLE AT THE TIME OF MR. STANTON'S TRANSFER) AT PARA. 2-6.1F PERMIT
PRO RATA REIMBURSEMENT WHEN INCIDENT TO A TRANSFER AN EMPLOYEE PURCHASES
OR SELLS LAND IN EXCESS OF THAT WHICH REASONABLY RELATES TO THE
RESIDENCE SITE. UNDER THIS REGULATION MR. STANTON'S ENTITLEMENT TO
REIMBURSEMENT DEPENDS ON THE DETERMINATION OF HOW MUCH LAND "REASONABLY
RELATES TO THE RESIDENCE SITE." BOTH THE AGENCY AND THE EMPLOYEE AGREE
THAT THE RESIDENCE SITE CONSISTS OF 5 ACRES. HOWEVER, THE EMPLOYEE
CLAIMS THAT AN ACCESS ROAD THROUGH THE REMAINDER OF HIS PROPERTY,
ACCOUNTING FOR AN ADDITIONAL 1-1/2 ACRES, REASONABLY RELATES TO THE
RESIDENTIAL SITE.
THE CRITERIA TO BE CONSIDERED IN DETERMINING WHAT LAND PERTAINS TO
THE RESIDENTIAL SITE AND WHAT LAND IS EXCESS WERE DISCUSSED AT LENGTH IN
MATTER OF COURTNEY, 56 COMP.GEN. 597 (1975). ALSO SEE MATTER OF
LINDERMAN. 60 COMP. 384 (1981). WHILE THE ACCESSIBILITY OF PROPERTY IS
A CONSIDERATION IN DETERMINING WHETHER LAND IS EXCESS, WE HAVE NEVER
HELD THAT A DRIVEWAY OR ACCESS ROAD CROSSING EXCESS LAND OWNED BY THE
EMPLOYEE RELATES TO THE RESIDENTIAL SITE. IF THE EMPLOYEE HAD PURCHASED
ONLY THE 5-ACRE PARCEL, HE COULD HAVE BEEN ALLOWED A RIGHT OF WAY
THROUGH THE ADJOINING LAND. HOWEVER, WHAT WOULD HAVE BEEN DONE IN THAT
CASE IS SPECULATIVE, THEREFORE, WE FIND THAT THE AGENCY'S DETERMINATION
TO BASE PRO RATA REIMBURSEMENT ON A 5-ACRE RESIDENTIAL SITE IS
REASONABLE.
WITH REGARD TO THE VALUE TO BE ASSIGNED TO THE PROPERTY, THE AGENCY
DETERMINED THAT THE AVERAGE VALUE OF 5 ACRES OF LAND IN KING GEORGE
COUNTY, VIRGINIA, IS $15,000 AND PRORATED REIMBURSEMENT USING THIS
FIGURE. FN1 THE EMPLOYEE OBJECTS STATING THAT THE RESIDENTIAL SITE IS
WATERFRONT PROPERTY BORDERING THE POTOMAC RIVER AND HE CONTENDS THAT THE
VALUE OF THE 5 ACRES IS $50,000. IN MATTER OF COURTNEY, CITED ABOVE, WE
RECOGNIZED THAT REAL ESTATE EXPENSES ASSESSED ON THE BASIS OF PURCHASE
PRICE RATHER THAN ACREAGE SHOULD BE PRORATED ON THE BASIS OF A RATIO
FORMULA OF RESIDENCE SITE VALUE TO PURCHASE PRICE OF THE PROPERTY.
BECAUSE THAT DECISION CONTEMPLATES PRORATION BASED ON THE VALUE OF THE
PARTICULAR RESIDENCE SITE, THE AGENCY SHOULD NOT HAVE BASED ITS
DETERMINATION ON THE AVERAGE VALUE OF LAND IN THE COUNTY. MR. STANTON'S
RESIDENTIAL SITE IS LOCATED ON THE POTOMAC RIVER AND THE AGENCY SHOULD
HAVE DETERMINED ITS VALUE ON THE BASIS OF COMPARABLE SALES OF RIVERFRONT
PROPERTIES.
WE HAVE HELD THE AGENCY'S PRORATION DETERMINATION MAY BE MADE ON THE
BASIS OF INFORMATION OBTAINED FROM RELIABLE REAL ESTATE BROKERS AND
APPRAISERS. 54 COMP.GEN. 597. WE NOTE THAT THE FILE CONTAINS A BILL
FROM A REAL ESTATE APPRAISER FOR AN APPRAISAL OF MR. STANTON'S PROPERTY
TO BE FURNISHED TO A LOCAL BANK FOR FINANCING PURPOSES. THE FILE DOES
NOT CONTAIN A COPY OF THAT APPRAISAL, ALTHOUGH MR. STANTON HAS STATED
THAT THE PROPERTY WAS APPRAISED AS FOLLOWS:
10 ACRES RESIDENTIAL $100,000
20 ACRES FARMLAND 40,000
20 ACRES WOODED 10,000
50 ACRES MARSH/STEEP 5,000
SUBJECT TO THE AGENCY'S VERIFICATION OF THIS APPRAISAL IT APPEARS THAT
$50,000 WOULD BE THE VALUE OF THE 5-ACRE RESIDENTIAL SITE AND THAT THIS
FIGURE SHOULD BE USED IN COMPUTING REIMBURSEMENT.
BEFORE CONSIDERING THE SPECIFIC ITEMS CLAIMED BY MR. STANTON WE POINT
OUT THAT UNDER THE PROVISIONS OF FTR PARA. 2-6.2G(2), REIMBURSEMENT OF
THE COSTS INCIDENT TO PURCHASE TRANSACTIONS IS LIMITED TO THE LESSER OF
$4,000 OR 5 PERCENT OF THE PURCHASE PRICE OF THE EMPLOYEE'S NEW
RESIDENCE. SINCE FTR PARA. 2-6.1B DEFINES THE RESIDENCE TO INCLUDE "A
MOBILE HOME AND/OR THE LOT ON WHICH SUCH MOBILE HOME IS LOCATED," THE
PURCHASE PRICE IS $70,000, THE SUM OF $50,000 ALLOCABLE TO THE RESIDENCE
SITE AND THE $20,000 COST OF THE MOBILE HOME. FIVE PERCENT OF THE
PURCHASE PRICE OF $70,000 IS $3,500. ADDITIONALLY PART 6 OF CHAPTER 2
OF THE FEDERAL TRAVEL REGULATIONS LIMITS REIMBURSEMENT TO AMOUNTS
CUSTOMARILY CHARGED IN THE LOCALITY OF THE RESIDENCE. PARA. 2-6.3C
STATES THAT "TECHNICAL ASSISTANCE IN DETERMINING THE REASONABLENESS OF
AN EXPENSE MAY BE OBTAINED FROM THE LOCAL AREA OFFICE OF THE DEPARTMENT
OF HOUSING AND URBAN DEVELOPMENT SERVING THE AREA IN WHICH THE EXPENSE
OCCURRED."
THE AGENCY LIMITED MR. STANTON'S CLAIM FOR REIMBURSEMENT OF THE
SETTLEMENT FEE, TITLE SEARCH, AND SURVEY FEE TO FLAT FEES OF $125, $150,
AND $150 RESPECTIVELY. THE EMPLOYEE'S RECLAIM IS FOR PRO RATA
REIMBURSEMENT FOR THE SETTLEMENT AND SURVEY FEES. HE CLAIMS
REIMBURSEMENT FOR THE FULL AMOUNT OF THE TITLE SEARCH FEE. WE WERE
INFORMED BY THE AGENCY THAT THEIR REDUCTION IN REIMBURSABLE EXPENSES WAS
BASED ON EXPERIENCE WITH CLAIMS FROM EMPLOYEES WHO PURCHASED HOUSES IN
OTHER PARTS OF VIRGINIA. THE FEDERAL TRAVEL REGULATIONS AT PARA. 2-6.2
PERMIT REIMBURSEMENT OF EXPENSES IF THEY ARE CUSTOMARILY PAID BY THE
PURCHASER TO THE EXTENT THEY DO NOT EXCEED THE AMOUNT CUSTOMARILY CHARGE
IN THE LOCALITY OF THE RESIDENCE. SINCE THE AGENCY'S LIMITATIONS OF MR.
STANTON'S REIMBURSEMENT WAS NOT BASED ON LOCAL CUSTOM IN KING GEORGE
COUNTY, IT DOES NOT ACCORD WITH THE FOLLOWING STANDARDS SET FORTH IN
MATTER OF COURTNEY:
"IN PRORATING THE EXPENSES, HOWEVER, THE
CERTIFYING OFFICER SHOULD ALSO TAKE INTO
ACCOUNT THE PRACTICE OF BILLING BY ATTORNEYS,
REAL ESTATE BROKERS AND SURVEYORS IN HIS
LOCALITY. THERE ARE CERTAIN LEGAL SERVICES
WHICH ARE PROVIDED FOR A FLAT FEE SUCH AS
RECORDING OF A DOCUMENT OR DRAWING A DEED
WHEREAS A SETTLEMENT FEE MIGHT BE BASED ON A
PERCENTAGE OF THE PURCHASE/SALE PRICE OF THE
PROPERTY AND MIGHT INCLUDE A FLAT FEE FOR
TITLE SEARCH. IN THIS CONNECTION, BROKERAGE
FEES ARE ALMOST ALWAYS BASED ON A PERCENTAGE
OF THE SALE PRICE. IF THE TITLE EXAMINATION,
FOR EXAMPLE, IS BASED ON A PERCENTAGE OF THE
PURCHASE PRICE, THE AMOUNT OF THE EXPENSE
SHOULD BE PRORATED IN ACCORDANCE WITH A RATIO
FORMULA OF RESIDENCE SITE VALUE TO PURCHASE
PRICE OF THE PROPERTY. ON THE OTHER HAND, IF
THE ATTORNEY CHARGES A FLAT FEE FOR TITLE
EXAMINATION, WHETHER IT CONCERNS 1 ACRE OR 5
ACRES, THE REIMBURSABLE EXPENSES SHOULD NOT
BE PRORATED AT ALL BUT SHOULD BE PAID IN
TOTAL, PROVIDING THE FEE IS REASONABLE IN
AMOUNT AND IN LINE WITH OTHER CHARGES FOR
SIMILAR SERVICES IN THE LOCALITY CONCERNED.
"SIMILAR CONSIDERATIONS SHOULD BE
APPLIED TO THE SURVEYOR'S FEE. WE UNDERSTAND
THAT A SURVEYOR'S FEE MIGHT BE COMPOSED OF A
CHARGE FOR THE SURVEYOR'S SEARCH OF THE LAND
RECORDS AND A CHARGE FOR THE FIELD WORK
COVERING THE ACTUAL MEASUREMENT OF THE LAND
NECESSARY FOR THE LEGAL DESCRIPTION OF THE
PROPERTY. IN SUCH CASES CAREFUL CONSIDERATION
SHOULD BE GIVEN TO THE CHARGES. THOSE
THAT ARE RELATED TO THE FIELD WORK SHOULD BE
PRORATED ACCORDING TO THE SIZE OF THE PROPERTY
AND THE RATIO FORMULA DETERMINED AS
ABOVE WHILE ALL CHARGES ATTRIBUTABLE TO WORK
ON THE LAND RECORDS SHOULD BE PAID BECAUSE A
SEARCHER COULD SPEND AS MUCH TIME WORKING ON
THE LAND RECORDS TRACING THE EVOLUTION OF A
SMALL PARCEL OF LAND AS HE/SHE WOULD ON A
LARGE TRACT."
THE AGENCY SHOULD RECONSIDER MR. STANTON'S CLAIM FOR THESE THREE ITEMS
OF EXPENSE USING THE GUIDANCE SET FORTH IN THAT DECISION.
MR. STANTON'S CLAIM FOR PRORATED REIMBURSEMENT OF THE SETTLEMENT COST
($50) AND RECORDING FEE ($41) FOR A SECOND TRUST WERE DISALLOWED BY THE
AGENCY BECAUSE THE SECOND TRUST WAS CLASSIFIED AS A COMMERCIAL LOAN ON
THE SETTLEMENT STATEMENT AND THE AGENCY REGARDED IT AS A "PERSONAL
BUSINESS TRANSACTION." COSTS INCIDENT TO A SECOND TRUST ARE ALLOWABLE,
AND MR. STANTON IS ENTITLED TO BE REIMBURSED FOR ONE-THIRD OF THE FEE
FOR RECORDING THE SECOND TRUST AND ALL OR A PRO RATA PORTION OF THE
RELATED SETTLEMENT FEE, DEPENDING ON THE BILLING PRACTICES OF LOCAL
ATTORNEYS. MATTER OF PUTNAM AND VERBLE, B-183251, MAY 29, 1975.
THE AGENCY DISALLOWED MR. STANTON'S CLAIM FOR A 1 PERCENT FEE PAID TO
THE FEDERAL LAND BANK ON THE GROUNDS THAT THIS FEE WAS A FINANCE CHARGE.
WE FIND THE DISALLOWANCE WAS CORRECT, AS THE PROVISIONS FTR PARA. 2-62D
APPLICABLE AT THE TIME OF MR. STANTON'S TRANSFER PRECLUDED REIMBURSEMENT
OF ANY FEE, COST, CHARGE, OR EXPENSE "WHICH IS DETERMINED TO BE A PART
OF THE FINANCE UNDER THE TRUTH IN LENDING ACT ***." IT IS WELL SETTLED
THAT A LOAN ORIGINATION FEE COVERING THE BANK'S ADMINISTRATIVE EXPENSES,
SUCH AS THAT CHARGED MR. STANTON BY THE FEDERAL LAND BANK, IS A FINANCE
CHARGE UNDER THE TRUTH IN LENDING ACT. MATTER OF POKORSKI, B-194314,
JUNE 28, 1979.
THE AGENCY ALLOWED MR. STANTON A PRORATED REIMBURSEMENT BASED ON
THEIR PRORATED 10 PERCENT OF THE PURCHASE PRICE FOR MORTGAGE TITLE
INSURANCE, MR. STANTON HAS REQUESTED PRORATED REIMBURSEMENT OF BOTH
MORTGAGE TITLE INSURANCE AND OWNER'S TITLE INSURANCE. FTR PARA. 2-6.2D
PERMITS REIMBURSEMENT OF MORTGAGE TITLE INSURANCE BUT SPECIFICALLY
PRECLUDES REIMBURSEMENT OF OWNER'S TITLE INSURANCE. HE MAY BE
REIMBURSED FOR MORTGAGE TITLE INSURANCE PRORATED AT THE REVISED PROPERTY
VALUATION. MATTER OF BREWSTER, B-193750, AUGUST 28, 1979.
FINALLY, MR. STANTON HAS RECLAIMED REIMBURSEMENT OF THE $375 FEE PAID
FOR A PERCOLATION TEST WHICH WAS ORIGINALLY DISALLOWED IN TOTAL BY THE
AGENCY. THAT DISALLOWANCE IS IN ACCORDANCE WITH OUR HOLDING IN MATTER
OF DRIECHAUP, B-205510, FEBRUARY 8, 1982, AND, THEREFORE, IS SUSTAINED.
ACCORDINGLY, THE VOUCHER IS RETURNED AND MR. STANTON'S CLAIM SHOULD
BE RECONSIDERED BY THE AGENCY IN ACCORDANCE WITH THIS DECISION.
FN 1 WE HAVE BEEN INFORMALLY ADVISED BY THE AGENCY THAT THE VALUATION
WAS DERIVED BY CONSULTING WITH THE KING GEORGE COUNTY TAX ASSESSOR'S
OFFICE.
B-210468, APR 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. TRANSFERRED EMPLOYEE'S CLAIM FOR REIMBURSEMENT OF CHILD CARE
EXPENSES INCURRED AT OLD DUTY STATION DURING PERIOD OF SPOUSE'S
HOUSE-HUNTING TRIP MAY NOT BE PAID SINCE NEITHER 5 U.S.C. SEC. 5724A(
A)(2) (1976) NOR CHAPTER 2, PART 4 OF THE FEDERAL TRAVEL REGULATIONS,
FPMR 101-7 (SEPTEMBER 1981) (FTR) AUTHORIZE SUCH AN ENTITLEMENT. ABSENT
STATUTORY OR REGULATORY AUTHORIZATION, FEES FOR CHILD CARE MAY NOT BE
REIMBURSED.
2. LANGUAGE IN DIGEST OF A COMPTROLLER GENERAL'S DECISION IS NOT
CONTROLLING, SINCE A DIGEST IS ONLY A SUMMARY OR PARAPHRASE OF A
DECISION, AND CANNOT BE RELIED UPON IN PREFERENCE TO THE TEXT ITSELF.
WILLIAM D. FALLIN - HOUSE-HUNTING EXPENSES - FEES FOR CHILD CARE:
KEVIN D. ROONEY, ASSISTANT ATTORNEY GENERAL FOR ADMINISTRATION, U.
S. DEPARTMENT OF JUSTICE, REQUESTS A DECISION AS TO WHETHER WILLIAM D.
FALLIN, EMPLOYED BY THE FEDERAL BUREAU OF INVESTIGATION (FBI) AS A
SPECIAL AGENT, WERE INCURRED BECAUSE OF HIS SPOUSE'S HOUSE-HUNTING
TRAVEL WHICH WAS PERFORMED IN CONNECTION WITH THE EMPLOYEE'S PERMANENT
CHANGE OF STATION FROM KNOXVILLE, TENNESSEE, TO BUTTE, MONTANA. WE
CONCUR WITH THE FBI'S ACTION DISALLOWING THE CLAIM SINCE REIMBURSEMENT
OF FEES FOR CHILD CARE IS NOT ALLOWED BY EITHER 5 U.S.C. SEC. 5724A(A)(
2) (1976) OR THE IMPLEMENTING PROVISIONS OF CHAPTER 2, PART 4 OF THE
FEDERAL TRAVEL REGULATIONS, FPMR 101-7 (SEPTEMBER 1981) (FTR).
DURING THE PERIOD MAY 6 TO MAY 13, 1982, MR. FALLIN'S SPOUSE
PERFORMED AUTHORIZED ROUND-TRIP TRAVEL FROM KNOXVILLE TO BUTTE, IN ORDER
TO SEEK PERMANENT RESIDENCE QUARTERS AT THE EMPLOYEE'S NEW DUTY STATION.
SINCE THE EMPLOYEE HAD ALREADY REPORTED FOR DUTY IN BUTTE AT THE TIME
OF HIS SPOUSE'S TRAVEL, MR. AND MRS. FALLIN MADE ARRANGEMENTS WITH A
PRIVATE PARTY IN KNOXVILLE TO CARE FOR THEIR CHILDREN DURING THE PERIOD
OF MRS. FALLIN'S ABSENCE.
MR. FALLIN FILED A CLAIM WITH THE FBI REQUESTING REIMBURSEMENT FOR
CHILD CARE EXPENSES IN THE AMOUNT OF $50, AND APPARENTLY SUBMITTED TO
THE AGENCY A SIGNED RECEIPT EVIDENCING PAYMENT OF THAT AMOUNT. THE
AGENCY DENIED THE EMPLOYEE'S CLAIM ON THE BASIS OF OUR DECISIONS IN
JAMES W. CLARK, B-193331, APRIL 25, 1979, MICHAEL W. COLLEGE, B-180623,
AUGUST 14, 1974, AND B-162466, SEPTEMBER 27, 1967, WHICH HELD GENERALLY
THAT FEES FOR CHILD CARE ARE NOT REIMBURSABLE EXPENSES OF TRAVEL OR
RELOCATION UNDER THE PROVISIONS OF THE FTR. SPECIFICALLY, IN CLARK,
ABOVE, WE CONSIDERED A TRANSFERRED EMPLOYEE'S CLAIM FOR TEMPORARY
QUARTERS SUBSISTENCE EXPENSES ATTRIBUTABLE TO LABOR PERFORMED BY THE
EMPLOYEE'S RELATIVES AT HIS NEW DUTY STATION TO CARE FOR HIS CHILDREN
AND INVALID WIFE. WE HELD THAT THE CHILD CARE FEES CHARGED BY THE
EMPLOYEE'S RELATIVES COULD NOT BE REIMBURSED BECAUSE THE EXPENSES WERE
INADEQUATELY DOCUMENTED, AND, MOREOVER, THE PROVISIONS OF THE FTR DO NOT
AUTHORIZE SUCH EXPENSES. IN COLLEGE, ABOVE, AN EMPLOYEE CLAIMED CHILD
CARE EXPENSES RESULTING FROM AN AGREEMENT MADE WITH A RELATIVE TO
FURNISH HIS FAMILY WITH TEMPORARY QUARTERS AND CHILD CARE IN CONNECTION
WITH THE EMPLOYEE'S CHANGE OF OFFICIAL STATION. WE HELD THAT THE
EXPENSES WERE NOT REIMBURSABLE UNDER THE FTR, EVEN THOUGH THE EMPLOYEE
HAD SUPPLIED A RECEIPT EVIDENCING PAYMENT OF THE CLAIMED EXPENSES. IN
OUR DECISION B-162466, ABOVE, WE DENIED REIMBURSEMENT OF CHILD CARE
EXPENSES INCURRED BY AN EMPLOYEE DURING A PERIOD OF TEMPORARY DUTY,
SINCE THE LAW AND REGULATIONS LIMIT REIMBURSEMENT FOR TEMPORARY DUTY
TRAVEL TO THE TRAVELER'S EXPENSES FOR SUBSISTENCE AND TRANSPORTATION IN
GOING TO AND FROM THE TEMPORARY DUTY STATION, AND DO NOT RELATE TO
EXPENSES INCURRED BY THE EMPLOYEE AT HIS FAMILY'S DOMICILE.
MR. FALLIN DISPUTES THE AGENCY'S DETERMINATION DENYING HIS CLAIM,
ARGUING THAT THE DECISIONS RELIED UPON BY THE AGENCY ARE DISTIGUISHABLE
FROM THE FACTS PRESENTED BY HIS CLAIM. IN THIS REGARD, HE ALLEGES THAT
LANGUAGE IN OUR DECISION COLLEGE, ABOVE, INDICATES THAT CHILD CARE
EXPENSES ARE ALLOWABLE IN THE PRESENCE OF EXTRAORDINARY CIRCUMSTANCES.
THE EMPLOYEE INTERPRETS OUR DECISIONS IN CLARK AND B-162466, CITED
ABOVE, AS DENYING REIMBURSEMENT OF FEES FOR CHILD CARE BECAUSE OF THE
ABSENCE OF EXTRAORDINARY CIRCUMSTANCES. SPECIFICALLY, HE NOTES THAT IN
THE FORMER CASE, THE CHILD CARE EXPENSES WERE INCURRED AT THE EMPLOYEE'S
NEW DUTY STATION AND RELATIVES WERE INVOLVED; IN THE LATTER CASE, ONE
PARENT WAS AVAILABLE TO CARE FOR THE CHILDREN. MR. FALLIN STATES THAT,
IN CONTRAST, EXTRAORDINARY CIRCUMSTANCES EXISTED IN HIS CASE DUE TO THE
SIMULTANEOUS ABSENCE OF BOTH PARENTS FROM KNOXVILLE DURING THE PERIOD OF
THE HOUSE-HUNTING TRIP AND THE ABSENCE OF RELATIVES IN THE KNOXVILLE
AREA. ADDITIONALLY, HE CONTENDS THAT THE REASONABLENESS OF THE $50
CHARGE FOR CHILD CARE AND THE FACT OF SEPARATE RECEIPTED PAYMENT OF THE
FEE PROVIDE A BASIS FOR PAYMENT OF THE EXPENSES CLAIMED.
AUTHORIZATION FOR PAYMENT OF HOUSE-HUNTING EXPENSES IS PROVIDED IN 5
U.S.C. SEC. 5724A(A)(2) AND IMPLEMENTING REGULATIONS CONTAINED IN
CHAPTER 2, PART 4 OF THE FTR. THOSE PROVISIONS LIMIT ALLOWANCES FOR
HOUSE-HUNTING TO THE ROUND-TRIP TRAVEL AND TRANSPORTATION EXPENSES OF AN
EMPLOYEE AND/OR HIS SPOUSE BETWEEN THE LOCALITIES OF THE OLD AND NEW
DUTY STATIONS, AND DO NOT AUTHORIZE PAYMENT OF EXPENSES INCURRED BY THE
EMPLOYEE AT HIS OLD DUTY POST. IN THE ABSENCE OF STATUTORY OR
REGULATORY AUTHORIZATION, WE ARE UNABLE TO AUTHORIZE REIMBURSEMENT FOR
CHILD CARE EXPENSES EVEN WHERE THERE IS AN INDICATION OF EXTENUATING
CIRCUMSTANCES. SEE GENERALLY CLARK, ABOVE.
THEREFORE, WE DISAGREE WITH THE EMPLOYEE'S ASSERTION THAT HIS CLAIM
IS DISTINGUISHABLE FROM OUR PRIOR DECISIONS DENYING REIMBURSEMENT FOR
CHILD CARE EXPENSES ON THE BASIS OF AN "EXTRAORDINARY CIRCUMSTANCES"
TEST WHICH ALLEGEDLY WAS ESTABLISHED IN COLLEGE, ABOVE. ALTHOUGH THE
DIGEST FOR COLLEGE STATED IN PART THAT "CHILD CARE EXPENSES ARE NOT
ALLOWABLE IN THE ABSENCE OF EXTRAORDINARY CIRCUMSTANCES," THE TEXT OF
THE DECISION DID NOT EXPRESSLY OR IMPLIEDLY SUGGEST THAT EXTRAORDINARY
CIRCUMSTANCES WOULD WARRANT REIMBURSEMENT OF FEES FOR CHILD CARE. SINCE
LANGUAGE IN A DIGEST IS ONLY A PARAPHRASE OR SUMMARY OF A DECISION, IT
CANNOT BE RELIED UPON IN PREFERENCE TO THE TEXT ITSELF. 56 COMP.GEN.
275 (1977). ACCORDINGLY, WHILE IT IS UNFORTUNATE THAT THE HOUSE-HUNTING
TRIP PERFORMED BY MR. FALLIN'S SPOUSE CAUSED THE EMPLOYEE TO INCUR
EXPENSES FOR CHILD CARE, THOSE EXPENSES ARE PERSONAL TO THE EMPLOYEE
AND, AS SUCH, MAY NOT BE PAID BY THE GOVERNMENT. SEE B-162466, ABOVE.
FOR THE REASONS STATED, WE HOLD THAT MR. FALLIN'S CLAIM FOR
REIMBURSEMENT FOR CHILD CARE EXPENSES MAY NOT BE PAID.
B-210455, FEB 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT REVIEW REJECTION OF THE LOW SMALL BUSINESS OFFEROR AS
NONRESPONSIBLE WHERE OFFEROR FAILED TO FILE CERTIFICATE OF COMPETENCY
APPLICATION WITH THE SMALL BUSINESS ADMINISTRATION.
SYNDEX RECOVERY SYSTEMS, INC.:
SYNDEX RECOVERY SYSTEMS, INC. (SYNDEX), PROTESTS THE REJECTION OF ITS
LOW OFFER UNDER REQUEST FOR PROPOSALS (RFP) NO. 41608-83-R-1442 ISSUED
BY KELLY AIR FORCE BASE.
THE PROTESTER ARGUES THAT THE GOVERNMENT USED OUTDATED AND INCOMPLETE
INFORMATION IN MAKING A JUDGMENT THAT ITS FIRM DID NOT POSSESS
SUFFICIENT WORKING CAPITAL TO SUCCESSFULLY COMPLETE THE WORK CALLED FOR
IN THE RFP.
WE HAVE BEEN ADVISED BY THE AIR FORCE THAT THE CONTRACTING OFFICER
INITIALLY DETERMINED SYNDEX TO BE NONRESPONSIBLE. BECAUSE OF SYNDEX'S
SMALL BUSINESS SIZE STATUS, THE MATTER WAS REFERRED TO THE SMALL
BUSINESS ADMINISTRATION (SBA) FOR A DETERMINATION AS TO WHETHER A
CERTIFICATE OF COMPETENCY (COC) WOULD BE ISSUED. SYNDEX FAILED TO FILE
AN APPLICATION FOR A COC AND THE SBA SUBSEQUENTLY CLOSED ITS FILE IN THE
MATTER WITHOUT ISSUANCE OF SUCH A CERTIFICATE. AS A RESULT OF THE
NEGATIVE PREAWARD SURVEY AND SYNDEX'S FAILURE TO OBTAIN A COC FROM THE
SBA, SYNDEX'S OFFER WAS REJECTED.
IT IS THE RESPONSIBILITY OF A SMALL BUSINESS FIRM DETERMINED TO BE
NONRESPONSIBLE TO FILE A COMPLETE AND ACCEPTABLE COC APPLICATION WITH
THE SBA IN ORDER TO AVAIL ITSELF OF THE POSSIBLE PROTECTION PROVIDED BY
STATUTE AND REGULATION AGAINST UNREASONABLE DETERMINATIONS BY
CONTRACTING OFFICERS AS TO ITS RESPONSIBILITY. GREENBRIER INDUSTRIES,
INC., B-191380, APRIL 24, 1978, 78-1 CPD 315. UNDER 15 U.S.C. SEC.
637(B)(7) (1976), AS AMENDED BY PUB.L. 95-89 SEC. 501, 91 STAT. 561,
AUGUST 4, 1977, THE SBA HAS THE CONCLUSIVE AUTHORITY TO ISSUE OR DENY A
COC. WHERE A FIRM DOES NOT FILE FOR A COC WITH THE SBA, WE WILL NOT
REVIEW THE CONTRACTING OFFICER'S DETERMINATION OF NONRESPONSIBILITY
SINCE SUCH ACTION, IN EFFECT, WOULD AMOUNT TO A SUBSTITUTION OF THIS
OFFICE FOR THE AGENCY SPECIFICALLY AUTHORIZED BY STATUTE TO REVIEW SUCH
DETERMINATIONS. JET INTERNATIONAL, INC., B-191183, FEBRUARY 14, 1978,
78-1 CPD 125.
IN VIEW OF THE FACT THAT THE PROTEST CORRESPONDENCE RAISES ISSUES
WHICH ARE NOT REVIEWABLE BY THIS OFFICE, NO USEFUL PURPOSE WOULD BE
SERVED IN FURTHER DEVELOPMENT OF THIS CASE PURSUANT TO OUR BID PROTEST
PROCEDURES, 4 C.F.R. PART 21 (1982).
ACCORDINGLY, WE DISMISS THE PROTEST.
B-210446, FEB 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
ALLEGATIONS REGARDING RESTRICTIVE SPECIFICATIONS FILED AFTER THE
CLOSING DATE FOR RECEIPT OF INITIAL PROPOSALS ARE UNTIMELY SINCE THE
ALLEGED DEFECTS WERE APPARENT ON THE FACE OF THE SOLICITATION.
MED-E-JET CORP.:
MED-E-JET CORP. (MED-E-JET) PROTESTS UNDER REQUEST FOR PROPOSALS
(RFP) NO. DLA120-83-R-0420 ISSUED BY THE DEFENSE LOGISTICS AGENCY,
DEFENSE PERSONNEL SUPPORT CENTER, PHILADELPHIA, PENNSYLVANIA. MED-E-JET
ALLEGES THAT THE SOLICITATION CONTAINS UNDULY RESTRICTIVE REQUIREMENTS.
WE DISMISS THE PROTEST BECAUSE IT WAS FILED AFTER THE CLOSING DATE FOR
RECEIPT OF INITIAL PROPOSALS.
THE TIMELINESS PROVISIONS OF OUR BID PROTEST PROCEDURES, 4 C.F.R.
SEC. 21.2(B) (1982), REQUIRE THAT PROTESTS REGARDING ALLEGED
DEFICIENCIES APPARENT ON THE FACE OF A SOLICITATION BE FILED BEFORE THE
CLOSING DATE FOR RECEIPT OF INITIAL PROPOSALS. IN THIS CASE, THE
CLOSING DATE FOR RECEIPT OF PROPOSALS WAS JANUARY 3, 1983; THE PROTEST,
HOWEVER, WAS NOT MAILED TO THE AGENCY UNTIL JANUARY 6, 1983, AND WAS NOT
FILED HERE UNTIL JANUARY 11, 1983. THE PROTEST THEREFORE IS UNTIMELY
AND WE WILL NOT CONSIDER IT ON THE MERITS. BUTT & HEAD, INCORPORATED,
B-208298, JULY 28, 1982, 82-2 CPD 92.
THE PROTEST IS DISMISSED.
B-210445, MAY 24, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. FAILURE BY BIDDER TO COMPLETE VARIOUS STANDARD REPRESENTATIONS
AND CERTIFICATIONS ON THE BID FORM, AS WELL AS THE PROVISION DESIGNATING
LOCATION WHERE SUPPLIES ARE TO BE INSPECTED, MAY BE WAIVED AS A MINOR
INFORMALITY, SINCE THE OMISSIONS DO NOT RELATE TO BID RESPONSIVENESS.
2. FACT THAT BIDDER QUALIFYING FOR LABOR SURPLUS AREA (LSA)
PREFERENCE CHANGES, AFTER BID OPENING AND WITH THE CONTRACTING AGENCY'S
CONSENT, THE PERFORMANCE LOCATION AND THE PERCENTAGE OF COSTS TO BE
INCURRED IN AN LSA DOES NOT AFFECT THE BIDDER'S ELIGIBILITY FOR THE
PREFERENCE, SINCE THE FIRM STILL WILL PERFORM AT LEAST THE MINIMUM
REQUIRED PERCENTAGE IN AN LSA.
3. GAO DOES NOT REVIEW AFFIRMATIVE DETERMINATIONS OF RESPONSIBILITY
EXCEPT IN LIMITED CIRCUMSTANCES.
K.P.B. INDUSTRIAL PRODUCTS, INC.:
K.P.B. INDUSTRIAL PRODUCTS, INC. (KPB) PROTESTS THE AWARD OF A
CONTRACT TO MARTINEZ, INC. UNDER INVITATION FOR BIDS (IFB) NO.
DLA100-82-B-1316 ISSUED BY THE DEFENSE LOGISTICS AGENCY (DLA). THE
CONTRACT IS FOR 660,000 SMALL ARMS AMMUNITION CASES FOR THE M-16 RIFLE.
THE SOLICITATION WAS ISSUED AS A TOTAL SMALL BUSINESS SET-ASIDE AND
PROVIDED A 2.2 PERCENT EVALUATION ADVANTAGE TO BIDDERS WHO AGREED TO
PERFORM AT LEAST 50 PERCENT OF THE CONTRACT IN GEOGRAPHIC AREAS THAT ARE
CLASSIFIED AS LABOR SURPLUS AREAS (LSAS) BY THE SECRETARY OF LABOR.
KPB'S PROTEST INVOLVES ALLEGED IRREGULARITIES IN THE BID SUBMITTED BY
MARTINEZ, MARTINEZ' ELIGIBILITY FOR THE LSA PREFERENCE, AND MARTINEZ'
CAPABILITY TO PERFORM THE CONTRACT.
WE DENY THE PROTEST CONCERNING MARTINEZ' BID AND ELIGIBILITY FOR THE
PREFERENCE. WE DISMISS THE PROTEST ABOUT THE FIRM'S CAPABILITY.
KPB ARGUES THAT THE BID SUBMITTED BY MARTINEZ SHOULD HAVE BEEN FOUND
NONRESPONSIVE. FIRST, KPB COMPLAINS THAT MARTINEZ FAILED TO SIGN OR
ACKNOWLEDGE THREE MATERIAL AMENDMENTS TO THE SOLICITATION PRIOR TO BID
OPENING. THIS COMPLAINT IS WITHOUT MERIT, HOWEVER, BECAUSE MARTINEZ DID
EXPRESSLY ACKNOWLEDGE THE RECEIPT OF ALL THREE AMENDMENTS ON THE BID
FORM ITSELF. THAT ACKNOWLEDGMENT IS ALL THAT IS REQUIRED TO INSURE THAT
ACCEPTANCE OF THE BID LEGALLY BINDS THE BIDDER TO COMPLY WITH THE
AMENDMENTS' TERMS. FORDICE CONSTRUCTION COMPANY, B-206633, APRIL 30,
1982, 82-1 CPD 401.
SECOND, KPB ARGUES THAT MARTINEZ' FAILURE TO COMPLETE VARIOUS
STANDARD REPRESENTATIONS AND CERTIFICATIONS IN THE BID RENDERED THE BID
NONRESPONSIVE. KPB ALLEGES THAT MARTINEZ FAILED TO COMPLETE, OR
IMPROPERLY COMPLETED, THE BUY AMERICAN CERTIFICATION, THE "CONTINGENT
FEE" REPRESENTATION, AND THE "AFFILIATION AND IDENTIFYING DATA"
PROVISION, AND ALSO FAILED TO DESIGNATE IN THE CLAUSE PROVIDED THE
LOCATION (PLANT AND ADDRESS) WHERE SUPPLIES WERE TO BE INSPECTED.
REGARDING THE INSPECTION LOCATION, MARTINEZ INDICATED IN THE SAME
CLAUSE THAT INSPECTION WAS TO OCCUR AT THE CONTRACTOR'S PLANT, AND
ELSEWHERE IN THE BID STATED THE PLANT'S LOCATION. MARTINEZ' FAILURE TO
COMPLETE THE PARTICULAR PROVISION IN ISSUE CLEARLY DID NOT AFFECT THE
ACCEPTABILITY OF THE BID, AND THUS MAY BE WAIVED AS A MINOR INFORMALITY.
DEFENSE ACQUISITION REGULATION (DAR) SEC. 2-405 (1976 ED.). WITH
RESPECT TO THE REPRESENTATIONS AND CERTIFICATIONS, WE REPEATEDLY HAVE
HELD THAT THEIR COMPLETION IS NOT REQUIRED TO DETERMINE WHETHER A BID
MEETS THE REQUIREMENTS OF THE SPECIFICATIONS AND, THEREFORE, THE FAILURE
TO COMPLETE THESE ITEMS DOES NOT AFFECT THE RESPONSIVENESS OF THE BID.
SEE BRYAN L. AND F. B. STANDLEY, B-186573, JULY 20, 1976, 76-2 CPD 60;
TENNESSEE VALLEY SERVICE, INC., B-186380, JUNE 25, 1976, 76-1 CPD 410.
ACCORDINGLY, ANY OMISSIONS MADE BY MARTINEZ IN COMPLETING THE VARIOUS
STANDARD REPRESENTATIONS AND CERTIFICATIONS MAY BE WAIVED.
KPB ALSO CONTENDS THAT MARTINEZ SHOULD NOT BE CONSIDERED ELIGIBLE FOR
THE LSA PREFERENCE. MARTINEZ HAD CERTIFIED IN ITS BID THAT 100 PERCENT
OF THE CONTRACT WOULD BE PERFORMED AT ITS PLANT IN FORT WAYNE, INDIANA,
AN LSA. KPB COMPLAINS THAT MARTINEZ HAS CHANGED THE PERFORMANCE
LOCATION, AND THAT MARTINEZ IS NOW APPROXIMATING THAT ONLY 90 PERCENT OF
CONTRACT COSTS WILL BE INCURRED IN LSAS, WITH ONLY 53 PERCENT OF THE
WORK BEING DONE AT THE NEW LOCATION. DLA HAS AGREED TO BOTH THE
LOCATION AND THE PERCENTAGE CHANGES.
THERE IS NO LEGAL MERIT TO KPB'S ARGUMENTS. WE HAVE HELD THAT A FIRM
THAT COMMITS ITSELF IN THE BID IN A MANNER THAT RENDERS THE FIRM
ELIGIBLE FOR THE LSA PREFERENCE SUBSEQUENTLY MAY CHANGE THE PLACE WHERE
THE REQUISITE PROPORTION OF COSTS WILL BE INCURRED, AS LONG AS THE NEW
LOCATION IS WITHIN AN LSA. SEE UFFNER TEXTILE CORPORATION, B-205050,
DECEMBER 4, 1981, 81-2 CPD 443. FURTHER, A BIDDER'S REPRESENTATION AS
TO THE AMOUNT OF COSTS TO BE INCURRED IN LSAS IS IMMATERIAL EXCEPT TO
THE EXTENT THAT IT MUST REPRESENT AT LEAST THE AMOUNT REQUIRED IN THE
SOLICITATION. CONSEQUENTLY, A BIDDER WHO REPRESENTS THAT 100 PERCENT OF
THE CONTRACT COSTS WILL BE INCURRED IN LSAS MAY REDUCE THAT AMOUNT AFTER
BID OPENING PROVIDED THE ACTUAL AMOUNT STILL EXCEEDS THAT REQUIRED. ID.
ACCORDINGLY, WE FIND NO IMPROPRIETY IN THE CONTRACTING OFFICER'S
ALLOWING MARTINEZ TO CHANGE THE LOCATION OF ITS PLACE OF PERFORMANCE OR
THE PERCENTAGE OF CONTRACT COSTS THAT WILL BE INCURRED IN LSAS. THIS
PROTEST GROUND IS DENIED.
KPB HAS ALSO RAISED SEVERAL QUESTIONS CONCERNING THE ABILITY OF
MARTINEZ TO PERFORM THE CONTRACT. THE ALLEGATIONS CONSTITUTE A
CHALLENGE TO DLA'S AFFIRMATIVE DETERMINATION OF RESPONSIBILITY,
EVIDENCED BY THE AWARD TO MARTINEZ. THIS OFFICE DOES NOT REVIEW A
CONTRACTING OFFICER'S AFFIRMATIVE DETERMINATION OF RESPONSIBILITY ABSENT
A SHOWING THAT THE CONTRACTING OFFICER MAY HAVE ACTED FRAUDULENTLY OR IN
BAD FAITH, OR THAT DEFINITIVE RESPONSIBILITY CRITERIA IN THE
SOLICITATION HAVE NOT BEEN MET. JENKINS EQUIPMENT CO., INC., B-207512,
JUNE 2, 1982, 82-1 CPD 531. KPB DOES NOT ALLEGE THAT EITHER EXCEPTION
IS PRESENT AND, ACCORDINGLY, THIS ASPECT OF KPB'S PROTEST IS DISMISSED.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
B-210444, MAR 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST FROM FIRM NOT IN LINE FOR AWARD IF PROTEST IS UPHELD IS
DISMISSED BECAUSE PROTESTER DOES NOT HAVE REQUISITE DIRECT AND
SUBSTANTIAL INTEREST WITH REGARD TO AWARD TO BE CONSIDERED AS
"INTERESTED PARTY" UNDER GAO BID PROTEST PROCEDURES.
2. PROTEST CHALLENGING FINANCIAL CAPACITY OF PROPOSED AWARDEE IS A
MATTER OF RESPONSIBILITY AND GAO DOES NOT REVIEW AFFIRMATIVE
DETERMINATIONS OF RESPONSIBILITY ABSENT CIRCUMSTANCES NOT PRESENT HERE.
PLURIBUS PRODUCTS INC.:
PLURIBUS PRODUCTS INC., PROTESTS THE PROPOSED AWARD OF A CONTRACT TO
MANUFACTURE FIELD DESKS TO DIVERSIFIED CONTAINER CORPORATION UNDER
INVITATION FOR BIDS (IFB) NO. DLA400-83-B-0149, ISSUED BY THE DEFENSE
GENERAL SUPPLY CENTER, RICHMOND, VIRGINIA. PLURIBUS CHALLENGES
DIVERSIFIED'S ABILITY TO PERFORM THE CONTRACT AND REQUESTS THAT OUR
OFFICE INVESTIGATE DIVERSIFIED'S CAPACITY AND INTEGRITY. WE DISMISS THE
PROTEST.
PLURIBUS CONTENDS THAT DIVERSIFIED HAS BEEN IN BUSINESS LESS THAN 1
YEAR AND IS THE SUCCESSOR CORPORATION TO A FIRM WHICH HAD RECEIVED A
NEGATIVE PREAWARD SURVEY ON A PREVIOUS PROCUREMENT AND SUBSEQUENTLY
WITHDREW ITS BID. PLURIBUS ALSO QUESTIONS WHETHER DIVERSIFIED'S
PRODUCTION PROCESSES WERE CAREFULLY SCRUTINIZED BY THE PREAWARD SURVEY
TEAM PRIOR TO ANY AFFIRMATIVE RECOMMENDATION THAT TEAM MIGHT HAVE GIVEN
TO THE CONTRACTING ACTIVITY.
PLURIBUS IS NOT ELIGIBLE TO MAINTAIN THIS PROTEST. UNDER OUR BID
PROTEST PROCEDURES, 4 C.F.R. SEC. 21.1(A) (1982), A PARTY MUST BE
"INTERESTED" IN ORDER TO HAVE ITS PROTEST CONSIDERED BY OUR OFFICE.
DETERMINING WHETHER A PARTY IS SUFFICIENTLY INTERESTED INVOLVES
CONSIDERATION OF THE PARTY'S STATUS IN RELATION TO THE PROCUREMENT. WE
HAVE BEEN ADVISED BY THE CONTRACTING AGENCY THAT PLURIBUS WAS NOT THE
SECOND LOW BIDDER ON ANY OF THE FOUR LINE ITEMS CONTAINED IN THE
SOLICITATION. THEREFORE, IT IS NOT AN "INTERESTED PARTY" SINCE IT WOULD
NOT BE IN LINE FOR AWARD IF ITS PROTEST WERE UPHELD. VEN-TEL, INC.,
B-204233, MARCH 8, 1982, 82-1 CPD 207.
IN ANY EVENT, PLURIBUS IS QUESTIONING DIVERSIFIED'S FINANCIAL
CAPACITY AND ITS ABILITY TO PRODUCE AND DELIVER THE ITEMS IN ACCORDANCE
WITH THE REQUIRED DELIVERY SCHEDULE AT THE PRICE BID. THESE ARE
ELEMENTS OF RESPONSIBILITY. THIS OFFICE DOES NOT CONSIDER BID PROTESTS
INVOLVING A CONTRACTING OFFICER'S AFFIRMATIVE DETERMINATION OF
RESPONSIBILITY, ABSENT A SHOWING THAT IT WAS MADE FRAUDULENTLY OR THAT
THE SOLICITATION CONTAINS DEFINITIVE RESPONSIBILITY CRITERIA THAT
ALLEGEDLY HAVE NOT BEEN APPLIED. VOYAGER EMBLEMS, INC., B-206301,
FEBRUARY 10, 1982, 82-1 CPD 127. NEITHER CONTENTION HAS BEEN ALLEGED
HERE. FURTHER, IT IS PURSUANT TO OUR BID PROTEST FUNCTION. STOCKER &
YALE, INC., B-207016, JULY 16, 1982, 82-2 CPD 21.
THE PROTEST IS DISMISSED.
B-210443, AUG 8, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. A PROPOSAL IS PROPERLY EXCLUDED FROM THE
COMPETITIVE RANGE FOR TECHNICAL DEFICIENCIES WHERE THOSE
DEFICIENCIES ARE SO MATERIAL AS TO PRECLUDE UPGRADING THE PROPOSAL
TO AN ACCEPTABLE LEVEL EXCEPT THROUGH MAJOR REVISION.
2. A PROTESTER'S MERE DISAGREEMENT WITH THE
AGENCY'S TECHNICAL EVALUATION OF ITS PROPOSAL DOES NOT MEET THE
PROTESTER'S BURDEN OF SHOWING THAT THE EVALUATION IS UNREASONABLE.
CONWAL INCORPORATED:
CONWAL INCORPORATED (CONWAL) PROTESTS THE EXCLUSION OF ITS PROPOSAL
FROM THE COMPETITIVE RANGE UNDER REQUEST FOR PROPOSAL (RFP) NO.
N00600-82-R-4343 ISSUED BY THE DEPARTMENT OF THE NAVY FOR THE PROCESSING
OF APPLICATIONS FOR THE NAVAL RESERVE OFFICERS TRAINING CORPS (NROTC)
SCHOLARSHIP FUND. SIX PROPOSALS WERE SUBMITTED IN RESPONSE TO THE RFP.
THE NAVY LIMITED THE COMPETITIVE RANGE TO FOUR OF THE OFFERORS. ONE OF
THOSE OFFERORS, DDD COMPANY, ULTIMATELY WAS AWARDED THE CONTRACT.
CONWAL ASSERTS THAT ITS PROPOSAL, THE LOWEST PRICED PROPOSAL
SUBMITTED IN RESPONSE TO THE RFP, ARBITRARILY WAS EXCLUDED FROM THE
COMPETITIVE RANGE, THUS DEPRIVING IT OF THE OPPORTUNITY TO ENTER INTO
DISCUSSIONS WITH THE NAVY FOR AWARD CONSIDERATION.
WE DENY THE PROTEST.
THE NAVY SOLICITED FOR THE SERVICES OF A CONTRACTOR TO PROVIDE A
VARIETY OF SERVICES NEEDED IN THE APPLICATION/PROCESSING/SELECTION CYCLE
FOR THE APPROXIMATELY 2,000 NROTC SCHOLARSHIPS AWARDED ANNUALLY.
THE RFP ADVISED OFFERORS THAT, FOR AWARD PURPOSES, COST WOULD BE
GIVEN A WEIGHT OF APPROXIMATELY TWO-THIRDS OF THAT APPLIED TO THE
TECHNICAL CRITERIA. THE RFP SET FORTH IN DESCENDING ORDER OF IMPORTANCE
(EXCEPT THAT THE FIRST TWO ITEMS WERE OF EQUAL IMPORTANCE) THE FOLLOWING
TECHNICAL EVALUATION CRITERIA:
- RESOURCES PROPOSED FOR THE CONTRACT
- UNDERSTANDING OF CONTRACT REQUIREMENTS
- CIRCUMSTANCES AND SOLUTIONS FOR POSSIBLE
INTERRUPTIONS OF SERVICE
- COMPANY EXPERIENCE
ALTHOUGH POINT SCORES FOR EACH CRITERIA WERE NOT DESIGNATED IN THE RFP,
THE NAVY APPLIED MAXIMUM POINT SCORES OF 30, 30, 25, AND 15,
RESPECTIVELY, FOR EACH OF THE TECHNICAL EVALUATION CRITERIA.
TWO TECHNICAL EVALUATORS REVIEWED EACH OF THE SIX PROPOSALS. CONWAL
RECEIVED A SCORE OF 40 OUT OF A POSSIBLE 100 POINTS FROM BOTH EVALUATORS
IN THE INITIAL TECHNICAL EVALUATION. THE FOUR FIRMS INCLUDED IN THE
COMPETITIVE RANGE RECEIVED INITIAL SCORES OF 60 OR HIGHER FROM EACH
EVALUATOR. THE AVERAGE TECHNICAL EVALUATION SCORES FOR THE SIX
PROPOSALS WERE:
BUSINESS COMPUTER SERVICES 91.5
CAPITAL SYSTEMS GROUP 80.5
DDD COMPANY 75.0
CONTRACT BUSINESS SERVICES 63.5
AMCI* 60.5
CONWAL* 40.0
*NOT INCLUDED IN THE COMPETITIVE RANGE.
CONWAL OFFERED TO PERFORM THE WORK FOR $401,400. THE OTHER PROPOSALS
RANGED IN PRICE FROM $420,600, OFFERED BY DDD COMPANY, THE AWARDEE, TO
$1,165,384.
THE NAVY REPORTS THAT CONWAL'S LOW TECHNICAL RATING WAS BASED ON THE
FOLLOWING DEFICIENCIES IN ITS PROPOSAL: (1) A LACK OF UNDERSTANDING AND
EXPERIENCE, (2) A LIMITED STAFF, (3) AN ABSENCE OF CONTINGENCY PLANNING,
AND (4) A WEAK RELATIONSHIP WITH ITS SUBCONTRACTOR. THE NAVY
CONTRACTING OFFICER FOUND THAT THESE DEFICIENCIES MADE THE PROPOSAL SO
UNACCEPTABLE THAT FURTHER DISCUSSIONS WOULD BENEFIT NEITHER THE
GOVERNMENT NOR THE OFFEROR. THEREFORE, THE PROPOSAL WAS EXCLUDED FROM
THE COMPETITIVE RANGE.
CONWAL ALLEGES THAT IT SHOULD HAVE BEEN INCLUDED IN THE COMPETITIVE
RANGE EVEN THOUGH THE NAVY FOUND ITS PROPOSAL TO BE TECHNICALLY
UNACCEPTABLE. WE DISAGREE.
OUR OFFICE WILL REVIEW TECHNICAL EVALUATION RESULTS ONLY TO DETERMINE
IF PROPOSALS WERE EVALUATED REASONABLY, IF AWARD WAS MADE IN ACCORDANCE
WITH STATED EVALUATION CRITERIA, AND/OR IF AWARD VIOLATED APPLICABLE
PROCUREMENT STATUTES OR REGULATIONS, WELDUN SPECIAL MACHINE, B-207268,
AUGUST 23, 1982, 82-2 CPD 166.
WE HAVE HELD THAT A PROPOSAL PROPERLY MAY BE EXCLUDED FROM THE
COMPETITIVE RANGE FOR DEFICIENCIES WHICH ARE SO MATERIAL THAT MAJOR
ADDITIONS AND REVISIONS WOULD BE REQUIRED TO MAKE IT ACCEPTABLE. THERE
IS NO REQUIREMENT THAT AN AGENCY PERMIT AN OFFEROR TO REVISE AN INITIAL
PROPOSAL WHEN SUCH A REVISION WOULD BE TANTAMOUNT TO THE SUBMISSION OF
ANOTHER PROPOSAL. DECILOG, B-198614, SEPTEMBER 3, 1980, 80-2 CPD 169.
AN EXAMINATION OF THE RECORD IN THIS PROTEST DEMONSTRATES THAT SUCH A
MAJOR REVISION WOULD BE NEEDED TO MAKE CONWAL'S PROPOSAL ACCEPTABLE.
CONWAL'S POSITION THAT ITS PROPOSAL SHOULD HAVE BEEN INCLUDED IN THE
COMPETITIVE RANGE IS BASED SOLELY ON ITS STATEMENT THAT ITS PROPOSAL WAS
FULLY RESPONSIVE TO THE RFP. THUS, CONWAL OFFERS NO EVIDENCE TO SHOW
THAT ITS PROPOSAL WAS EXCLUDED AS A RESULT OF ANYTHING OTHER THAN THE
REASONABLE JUDGMENT OF THE NAVY'S TECHNICAL EVALUATORS. BECAUSE
CONTRACTING OFFICERS ARE GIVEN A CONSIDERABLE RANGE OF JUDGMENT AND
DISCRETION IN CARRYING OUT A TECHNICAL EVALUATION, THE PROTESTER'S MERE
DISAGREEMENT WITH THE AGENCY'S EVALUATION DOES NOT MEET THE PROTESTER'S
BURDEN OF SHOWING THAT THE EVALUATION WAS UNREASONABLE. SPECTRUM
LEASING CORPORATION, B-205781, APRIL 26, 1982, 82-1 CPD 383.
THE FACT THAT CONWAL SUBMITTED THE LOWEST PRICED PROPOSAL IS
IRRELEVANT. WHERE, AS HERE, THE FIRM OFFERING THE LOWEST PRICED
PROPOSAL IS PROPERLY EXCLUDED FROM THE COMPETITIVE RANGE, THE AGENCY'S
REFUSAL TO CONDUCT NEGOTIATIONS WITH THAT FIRM IS PROPER. SEE
TECHNIARTS, B-192158, MARCH 29, 1979, 79-1 CPD 213.
PROTEST DENIED.
B-210442, SEP 2, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
CUSTOMS SERVICE REQUESTS DECISION WHETHER
AN INSPECTOR'S OVERTIME ASSIGNMENTS FROM
9:30 P.M. TO 10:30 P.M. SUNDAY, AND FROM
12:45 A.M. TO 1:45 A.M. MONDAY, MAY BE
CONSIDERED CONTINUOUS SO AS TO LIMIT HIS
OVERTIME ENTITLEMENT TO 1/2 DAY'S PAY FOR
EACH ASSIGNMENT. WE CONCLUDE THAT UNDER
CURRENT CUSTOMS REGULATIONS THE MONDAY
ASSIGNMENT IS NOT A CONTINUATION OF THE
SUNDAY ASSIGNMENT, AND THE INSPECTOR IS
ENTITLED TO 1-1/2 DAYS' PAY FOR THE MONDAY
ASSIGNMENT.
CUSTOMS INSPECTORS - OVERTIME COMPENSATION - AGGREGATING
SEPARATE PERIODS OF OVERTIME:
ISSUE
THE ISSUE IN THIS DECISION INVOLVES WHETHER A CUSTOMS INSPECTOR'S
OVERTIME ASSIGNMENTS FROM 9:30 P.M. TO 10:30 P.M. SUNDAY AND FROM 12:45
A.M. TO 1:45 A.M. MONDAY MAY BE CONSIDERED CONTINUOUS SO AS TO LIMIT HIS
OVERTIME ENTITLEMENT UNDER THE PROVISIONS OF 19 U.S.C. SEC. 267, AND THE
IMPLEMENTING REGULATIONS. FOR THE REASONS THAT FOLLOW, WE HOLD THAT
UNDER EXISTING REGULATIONS THE CUSTOMS SERVICE MAY NOT TREAT SUCH
ASSIGNMENTS AS CONTINUOUS SERVICE.
BACKGROUND
THIS DECISION IS IN RESPONSE TO A REQUEST FROM THE HONORABLE ALFRED
R. DEANGELUS, ACTING COMMISSIONER OF CUSTOMS, U.S. CUSTOMS SERVICE.
THIS DECISION IS BEING HANDLED UNDER OUR LABOR-MANAGEMENT PROCEDURES
CONTAINED IN 4 C.F.R. PART 22 (1983), AND WE HAVE RECEIVED COMMENTS ON
THIS MATTER FROM THE NATIONAL TREASURY EMPLOYEES UNION.
THIS QUESTION INVOLVING AN INTERPRETATION OF THE CUSTOMS SERVICE
REGULATIONS GOVERNING OVERTIME ENTITLEMENT AROSE FROM A GRIEVANCE FILED
BY A CUSTOMS INSPECTOR WHICH WAS DENIED BY THE AGENCY. THE INSPECTOR
WORKED ON SUNDAY FROM 12 NOON TO 8 P.M., AND FROM 9:30 P.M. TO 10:30 P.
M., AND FINALLY FROM 12:45 A.M. TO 1:45 A.M. MONDAY. UNDER THE
APPLICABLE STATUTE AND REGULATIONS, HE WAS PAID 2 DAYS' PAY FOR THE
SUNDAY WORK FROM 12 NOON TO 8 P.M., AND 1/2 DAY'S PAY FOR THE WORK FROM
9:30 P.M. TO 10:30 P.M. THE ISSUE IN DISPUTE IS WHETHER THE WORK
PERFORMED FROM 12:45 A.M. TO 1:45 A.M. MONDAY SHALL BE TREATED AS A
CONTINUATION OF THE SERVICES PERFORMED ON SUNDAY (WHICH WOULD ENTITLE
THE INSPECTOR TO 1/2 DAY'S PAY), OR AS A SEPARATE CLAIM FOR OVERTIME
WORK AT NIGHT (WHICH WOULD ENTITLE THE INSPECTOR TO 1-1/2 DAYS' PAY).
THE CUSTOMS SERVICE SEEKS TO ESTABLISH A NATIONAL POLICY ON WHAT
CONSTITUTES CONTINUOUS OVERTIME ASSIGNMENTS AND REQUESTS OUR DECISION
WHETHER A BREAK IN ASSIGNMENTS OF LESS THAN 2 HOURS BETWEEN SUNDAY OR
HOLIDAY WORK AND WEEKDAY WORK CAN BE CONSIDERED CONTINUOUS SERVICE UNDER
THE CURRENT REGULATIONS. CUSTOMS ALSO QUESTIONS WHETHER BREAKS IN
ASSIGNMENTS SHOULD BE COMPUTED FROM WHEN THE OVERTIME WORK WAS COMPLETED
OR FROM WHEN THE INSPECTOR WAS NO LONGER AVAILABLE FOR SERVICE (OVERTIME
IS COMPENSATED FOR ON THE BASIS OF 2-HOUR INCREMENTS). FINALLY, THE
CUSTOMS SERVICE REQUESTS OUR DECISION WHETHER THIS INSPECTOR IS ENTITLED
TO 1/2 DAY'S PAY OR 1-1/2 DAYS' PAY FOR THE OVERTIME PERFORMED ON MONDAY
MORNING.
THE CHIEF COUNSEL OF THE CUSTOMS SERVICE IS OF THE OPINION THAT WHEN
THERE IS A BREAK IN ASSIGNMENTS BETWEEN SUNDAY NIGHT AND MONDAY MORNING
(AS IN THIS CASE), THE MONDAY ASSIGNMENT IS NOT A CONTINUATION OF THE
SUNDAY ASSIGNMENT. THE CHIEF COUNSEL POINTS OUT THAT SUNDAY IS DEFINED
IN THE APPLICABLE REGULATIONS (19 C.F.R. SEC. 24.16(H)) AS
MIDNIGHT-TO-MIDNIGHT, AND AN ASSIGNMENT MONDAY MORNING CANNOT BE
CONSIDERED SUNDAY SERVICE UNLESS IT IS A CONTINUATION OF AN ASSIGNMENT
BEGUN ON SUNDAY. THUS, THE CHIEF COUNSEL CONCLUDES THAT THIS CUSTOMS
INSPECTOR IS ENTITLED TO 1-1/2 DAYS' PAY FOR THE MONDAY ASSIGNMENT.
THE CHIEF COUNSEL OF CUSTOMS DOES AGREE THAT WHETHER THE ASSIGNMENT
IS CONTINUOUS IS COMPUTED FROM THE INSPECTOR'S AVAILABILITY, NOT FROM
WHEN THE INSPECTOR'S WORK ACTUALLY ENDED. AN INSPECTOR IS PAID FOR
OVERTIME ON THE BASIS OF 2-HOUR INCREMENTS WITH ANY FRACTION OF 2 HOURS
AMOUNTING TO AT LEAST 1 HOUR TO BE COUNTED AS 2 HOURS. THUS, AN
INSPECTOR WHO WORKS FROM 10 P.M. TO 11 P.M., AND THEN BEGINS AN
ASSIGNMENT AT 12 MIDNIGHT, WOULD BE CONSIDERED TO BE WORKING
CONTINUOUSLY.
THE NATIONAL TREASURY EMPLOYEES UNION PROVIDED COMMENTS ON THIS
MATTER AND ARGUES THAT THE MONDAY ASSIGNMENT IS SEPARATE AND CANNOT BE
CONSIDERED SUNDAY WORK EXCEPT IN THAT LIMITED SITUATION WHERE THE MONDAY
ASSIGNMENT IS A CONTINUATION OF THE SUNDAY WORK AS SUGGESTED BY THE
CHIEF COUNSEL OF CUSTOMS. THE UNION ALSO POINTS OUT THAT UNDER 19
C.F.R. SEC. 24.16(F), BROKEN PERIODS OF OVERTIME ARE TO BE CONSIDERED
CONTINUOUS FOR THE PURPOSES OF OVERTIME COMPENSATION. HOWEVER, THE UNION
ARGUES THAT THE REGULATION IS LIMITED IN THIS CASE TO BROKEN PERIODS OF
OVERTIME OCCURRING BEFORE MIDNIGHT SUNDAY AND DOES NOT APPLY TO AN
OVERTIME ASSIGNMENT WHICH BEGINS MONDAY MORNING.
DISCUSSION
CUSTOMS INSPECTORS ARE ENTITLED TO CERTAIN OVERTIME COMPENSATION FOR
OVERTIME WORK BETWEEN 5 P.M. AND 8 A.M., OR FOR WORK ON SUNDAYS OR
HOLIDAYS UNDER THE AUTHORITY OF 19 U.S.C. SEC. 267, WHICH PROVIDES IN
PERTINENT PART AS FOLLOWS:
"THE SECRETARY OF THE TREASURY SHALL FIX A
REASONABLE RATE OF EXTRA COMPENSATION FOR
OVERTIME SERVICES OF CUSTOMS OFFICERS AND
EMPLOYEES WHO MAY BE REQUIRED TO REMAIN ON
DUTY BETWEEN THE HOURS OF FIVE O'CLOCK
POST-MERIDIAN AND EIGHT O'CLOCK ANTEMERIDIAN, OR
ON SUNDAYS OR HOLIDAYS *** SUCH RATES TO BE
FIXED ON THE BASIS OF ONE-HALF DAY'S ADDITIONAL
PAY FOR EACH TWO HOURS OR FRACTION
THEREOF OF AT LEAST ONE HOUR THAT THE OVERTIME
EXTENDS BEYOND FIVE O'CLOCK POSTMERIDIAN
(BUT NOT TO EXCEED TWO AND ONE-HALF
DAYS' PAY FOR THE FULL PERIOD FROM FIVE
O'CLOCK POSTMERIDIAN TO EIGHT O'CLOCK
ANTEMERIDIAN), AND TWO ADDITIONAL DAYS' PAY
FOR SUNDAY OR HOLIDAY DUTY ***."
THIS ADDITIONAL COMPENSATION IS PAID BY THE SHIPPER OR CARRIER
REQUESTING THE CUSTOMS INSPECTION TO THE CUSTOMS SERVICE.
THE IMPLEMENTING REGULATIONS CONTAINED IN 19 C.F.R. SEC. 24.16,
PROVIDE IN SUBSECTION (H) FOR THE PAYMENT OF 2 DAYS' PAY FOR THE 8 HOURS
THE EMPLOYEE WORKED ON SUNDAY FROM 12 NOON TO 8 P.M. THIS SUBSECTION
ALSO PROVIDES THAT SERVICE IN EXCESS OF 8 HOURS ON A SUNDAY OR HOLIDAY
SHALL BE COMPENSATED "ON THE SAME BASIS AS OVERTIME SERVICES PERFORMED
AT NIGHT ON A WEEKDAY." THUS, FOR SERVICE BETWEEN 9:30 P.M. AND 10:30
P.M., SECTION 24.16(G) PROVIDES 1/2 DAY'S PAY FOR EACH 2 HOURS OF
COMPENSABLE TIME, WITH SERVICE OF AT LEAST 1 HOUR COUNTED AS 2 HOURS.
SEE B-201789, OCTOBER 20, 1981, 61 COMP.GEN. 33.
AS THE PARTIES INDICATE, IF THE ASSIGNMENT ON MONDAY IS DEEMED A
CONTINUATION OF THE WORK ON SUNDAY, SECTION 24.16(G) PROVIDES AS
FOLLOWS:
"*** IF AN EMPLOYEE PERFORMS OVERTIME SERVICES
DURING THE NIGHT HOURS AT THE BEGINNING
OF THE NEXT REGULAR WORKDAY FOLLOWING A
SUNDAY OR HOLIDAY WHICH OVERTIME SERVICES ARE
IN CONTINUATION OF AN ASSIGNMENT BEGUN ON THE
SUNDAY OR HOLIDAY IMMEDIATELY PRECEDING SUCH
REGULAR WORKDAY, THE COMPENSABLE TIME FOR THE
OVERTIME SERVICES FOLLOWING SUCH SUNDAY OR
HOLIDAY SHALL BE THE PERIOD BETWEEN MIDNIGHT
OF SUCH SUNDAY OR HOLIDAY AND THE CONCLUSION
OF THE OVERTIME SERVICES."
SECTION 24.16(G) ALSO PROVIDES A LIMITATION ON TOTAL COMPENSATION PAID
PURSUANT TO THE SECTION DURING 1 NIGHT OF 2-1/2 DAYS' PAY.
IF THE ASSIGNMENT ON MONDAY IS NOT CONSIDERED A CONTINUATION OF THE
SUNDAY OVERTIME ASSIGNMENT, THE PARTIES AGREE THAT THE MONDAY MORNING
WORK WOULD HAVE TO BE CONSIDERED AS SEPARATE NIGHT WORK. UNDER 19 C.F.
R. SEC. 24.16(B), THE WORD "NIGHT" MEANS THE TIME BETWEEN 5:00 P.M. AND
8:00 A.M., BUT "SHALL NOT INCLUDE ANY SUCH TIME WITHIN THE 24 HOURS OF A
SUNDAY OR HOLIDAY." INSTEAD, "THE NIGHT HOURS AT THE END OF THE REGULAR
WORKDAY IMMEDIATELY PRECEDING A SUNDAY OR HOLIDAY AND THE NIGHT HOURS AT
THE BEGINNING OF THE NEXT REGULAR WORKDAY SHALL BE CONSIDERED FOR THE
PURPOSES OF THIS SECTION AS PARTS OF A SINGLE NIGHT."
COMPENSABLE TIME FOR OVERTIME SERVICES IS COMPUTED UNDER SECTION
24.16(G) AS FOLLOWS:
"THE REASONABLE RATE OF EXTRA COMPENSATION
FOR AUTHORIZED OVERTIME SERVICES PERFORMED BY
CUSTOMS EMPLOYEES AT NIGHT ON ANY WEEKDAY IS
HEREBY FIXED AT ONE-HALF OF THE GROSS DAILY
RATE OF THE REGULAR PAY OF THE EMPLOYEE WHO
PERFORMS THE SERVICE FOR EACH 2 HOURS OF
COMPENSABLE TIME, ANY FRACTION OF 2 HOURS
AMOUNTING TO AT LEAST 1 HOUR TO BE COUNTED AS
2 HOURS. THE COMPENSABLE TIME SHALL BE *** THE
PERIOD BETWEEN THE TIME THE EMPLOYEE IS
ASSIGNED AND REPORTS FOR DUTY AND THE CONCLUSION
OF THE SERVICES, PLUS 4 HOURS, IF THE
TIME OF ASSIGNMENT IS AFTER THE EXPIRATION OF
THE FIRST 4 AND BEFORE THE BEGINNING OF THE
LAST 2 HOURS OF THE NIGHT. ***"
THUS, IF THE ASSIGNMENT IS NOT CONTINUOUS, THE INSPECTOR IN THIS CASE IS
ENTITLED TO A 4-HOUR "ROLL BACK" ADDED TO HIS ASSIGNMENT OF 1 HOUR FROM
12:45 A.M. TO 1:45 A.M. MONDAY, WITH THE 5 HOURS OF COMPENSABLE TIME
WORTH 3 ONE-HALF DAY'S OF PAY, OR 1-1/2 DAYS' PAY. SEE 37 COMP. GEN.
276 (1957).
WE AGREE WITH THE INTERPRETATION OF THE CHIEF COUNSEL OF CUSTOMS AND
THE UNION THAT IN THIS SITUATION THE INSPECTOR'S MONDAY ASSIGNMENT
CANNOT BE CONSIDERED A CONTINUATION OF THE SUNDAY OVERTIME WORK. WITH
THE INSPECTOR'S ASSIGNMENT FROM 9:30 P.M. TO 10:30 P.M., AND WITH THE
CONCEPT OF 2 HOURS COMPENSABLE TIME FOR EACH OVERTIME ASSIGNMENT OF 1
HOUR OR MORE, THE INSPECTOR WAS CONSIDERED AVAILABLE FOR DUTY ONLY UNTIL
11:30 P.M. ABSENT LANGUAGE IN THE CUSTOMS REGULATIONS PERMITTING
AGGREGATION IN THIS SITUATION, WE DO NOT CONSIDER AN ASSIGNMENT
BEGINNING AT 12:45 A.M. MONDAY TO BE A CONTINUATION FROM THE ASSIGNMENT
ENDING AT 11:30 P.M. SUNDAY.
THE CUSTOMS REGULATIONS DO PROVIDE FOR THE AGGREGATION OF OVERTIME
ASSIGNMENTS IN SPECIFIC SITUATIONS. FOR EXAMPLE, WHERE AN INSPECTOR
PERFORMS WORK ON A SUNDAY OR HOLIDAY THE RATE OF PAY IS APPLIED "***
WHETHER IT THE LENGTH OF TIME IS SERVED CONTINUOUSLY OR IN BROKEN
PERIODS, AND WHETHER IT IS SERVED FOR ONE OR MORE APPLICANTS. ***" SEE
19 C.F.R. SEC. 24.16(H), AND B-201789, OCTOBER 20, 1981, 61 COMP.GEN.
33. THE ONLY OTHER REFERENCE TO AGGREGATION OF ASSIGNMENTS IS CONTAINED
IN 19 C.F.R. SEC. 24.16(F), WHICH PROVIDES AS FOLLOWS:
"(F) BROKEN PERIODS. WHEN OVERTIME SERVICES
AT NIGHT OR ON A SUNDAY OR HOLIDAY ARE
RENDERED IN BROKEN PERIODS, THE ACTUAL TIME
EACH ASSIGNMENT BEGAN AND ENDED SHALL BE
REPORTED. OVERTIME SERVICES RENDERED IN SUCH
BROKEN PERIODS SHALL BE TREATED AS THOUGH THE
SERVICES HAD BEEN CONTINUOUS EXCEPT WHEN THE
TOTAL OF THE COMPENSATION COMPUTED SEPARATELY
FOR EACH SUCH PERIOD IN ACCORDANCE WITH THE
PROVISIONS OF PARAGRAPHS (G) AND (H) OF THIS
SECTION IS LESS THAN WHEN COMPUTED AS THOUGH
THE SERVICES HAD BEEN CONSIDERED CONTINUOUS.
FOR PURPOSES OF COMPUTING COMPENSATION, EACH
TIME AN EMPLOYEE IS ASSIGNED AND REPORTS FOR
OVERTIME DUTY ON A WEEKDAY OR ON A SUNDAY OR
HOLIDAY CONSTITUTES A SEPARATE BROKEN PERIOD
EVEN THOUGH NO SERVICES, OR SERVICES OF LESS
THAN 1 HOUR, ARE ACTUALLY RENDERED ON SUCH
ASSIGNMENT. ***"
WE AGREE WITH THE UNION'S CONTENTION THAT SECTION (F) DOES NOT PERMIT
THE AGGREGATION OF OVERTIME ASSIGNMENTS AS SUGGESTED BY THE CUSTOMS
SERVICE IN THIS CASE. THIS SECTION DOES NOT REQUIRE THAT SUNDAY AND
MONDAY SERVICE BE CONSIDERED CONTINUOUS FOR PAY PURPOSES, BUT RATHER
THAT BROKEN PERIODS OF OVERTIME SERVICES AT NIGHT, OR ON A SUNDAY OR
HOLIDAY, SHOULD BE CALCULATED AS THOUGH CONTINUOUS. ASSIGNMENTS ON
SUNDAY NIGHT AND EARLY MONDAY MORNING ARE NOT PERFORMED DURING THE SAME
"NIGHT" SINCE UNDER SECTION 24.16(B), QUOTED ABOVE, THE 24 HOURS OF A
SUNDAY OR HOLIDAY ARE EXCLUDED FROM THE DEFINITION OF SERVICE AT
"NIGHT."
ACCORDINGLY, WE CONCLUDE THAT THE CUSTOMS SERVICE MAY NOT UNDER ITS
CURRENT REGULATIONS AGGREGATE OVERTIME ASSIGNMENTS WITH INTERRUPTIONS OF
LESS THAN 2 HOURS. THEREFORE, WE HOLD THAT THE CUSTOMS INSPECTOR IN
THIS CASE IS ENTITLED TO 1-1/2 DAYS' PAY FOR THE MONDAY OVERTIME
ASSIGNMENT.
AS WE STATED IN 37 COMP.GEN. 276, (1957) THE STATUTE AUTHORIZES THE
SECRETARY OF THE TREASURY TO "FIX A REASONABLE RATE OF EXTRA
COMPENSATION", AND WE SEE NO PROHIBITION TO CUSTOMS AMENDING ITS
REGULATIONS IN ORDER TO AGGREGATE OVERTIME ASSIGNMENTS WHERE THE
INTERRUPTION BETWEEN ASSIGNMENTS IS LESS THAN 2 HOURS. AS WE NOTED ON
PAGE 2 OF THIS DECISION, WE AGREE WITH THE VIEWS OF THE CHIEF COUNSEL OF
THE CUSTOMS SERVICE AS TO THE METHOD FOR COMPUTING THE LENGTH OF THE
INTERRUPTION. THE BREAKS IN ASSIGNMENTS SHOULD BE DETERMINED ON THE
BASIS OF THE TIME FOR WHICH THE INSPECTOR IS PAID AND MUST BE AVAILABLE
FOR DUTY.
B-210441, FEB 2, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
AN ALLEGED IMPROPRIETY IN A REQUEST FOR PROPOSALS NOT RAISED UNTIL
AFTER THE CLOSING DATE FOR RECEIPT OF BEST AND FINAL OFFERS IS UNTIMELY
AND WILL NOT BE CONSIDERED ON THE MERITS.
FACET DEVICES CORPORATION:
FACET DEVICES CORPORATION, FACET ENTERPRISES, INC. (FDC), PROTESTS
THE DEPARTMENT OF THE ARMY'S (ARMY) DECISION TO CERTIFY GARCIA ORDNANCE
CORPORATION (GOC) AS AN APPROVED SOURCE FOR A PROCUREMENT OF CARBURETORS
UNDER REQUEST FOR PROPOSALS (RFP) NO. DAAJ09-82-R-B104. FDC CONTENDS
THAT GOC DOES NOT QUALIFY AS AN APPROVED SOURCE FOR CARBURETORS.
WE DISMISS THE PROTEST.
FDC'S PROTEST LETTER DATED JANUARY 5, 1983, WAS FILED (RECEIVED) IN
OUR OFFICE ON JANUARY 11, 1983. THE ARMY ADVISES THAT THE INITIAL
CLOSING DATE WAS JULY 22, 1982, AND THE CLOSING DATE FOR SUBMISSION OF
BEST AND FINAL OFFERS WAS JANUARY 6, 1983.
OUR BID PROTEST PROCEDURES REQUIRE THAT A PROTEST BASED UPON ALLEGED
IMPROPRIETIES IN AN RFP WHICH ARE APPARENT PRIOR TO THE CLOSING DATE FOR
THE RECEIPT OF PROPOSALS BE FILED PRIOR TO THE CLOSING DATE. 4 C. F.R.
SEC. 21.2(B)(1) (1982). FURTHER, WHERE THE ALLEGED IMPROPRIETIES DO NOT
EXIST IN THE INITIAL SOLICITATION, BUT ARE SUBSEQUENTLY INCORPORATED
THEREIN, A PROTEST MUST BE FILED NOT LATER THAN THE NEXT CLOSING DATE.
WHILE THE CLOSING DATE FOR RECEIPT OF BEST AND FINAL OFFERS WAS
JANUARY 6, 1983, THE PROTEST WAS NOT FILED UNTIL JANUARY 11, 1983,
ALTHOUGH FDC WAS AWARE OF THE ALLEGED IMPROPRIETY CONTAINED IN THE
SOLICITATION - GOC'S CERTIFICATION AS AN APPROVED SOURCE - PRIOR TO THE
CLOSING DATE. IN THIS CONNECTION, THE ARMY ADVISES THAT ON DECEMBER 20,
1982, THE CONTRACTING OFFICER ORALLY ADVISED FDC THAT GOC WAS AN
APPROVED SOURCE UNDER THIS RFP, AND THAT THIS WOULD BE CONFIRMED BY
AMENDMENT TO THE RFP. FDC'S PROTEST CONTAINS A COPY OF A FREEDOM OF
INFORMATION ACT (FOIA) REQUEST FILED ON DECEMBER 20, 1982, WHICH
INDICATES KNOWLEDGE OF THIS INFORMATION, BY ASKING FOR THE PREAWARD
SURVEY PERTAINING TO THE ARMY'S CERTIFICATION OF GOC AS AN APPROVED
SOURCE. THE ARMY FURTHER ADVISES THAT AN AMENDMENT LISTING GOC AS AN
APPROVED SOURCE WAS ISSUED ON DECEMBER 21, 1982. FDC ACKNOWLEDGED THIS
AMENDMENT ON JANUARY 6, 1983, INDICATING THAT FDC RECEIVED THE AMENDMENT
IN A TIMELY MANNER.
UNDER THESE CIRCUMSTANCES, THIS PROTEST FILED AFTER THE CLOSING DATE
IS UNTIMELY AND WILL NOT BE CONSIDERED ON THE MERITS.
WE DISMISS THE PROTEST.
FILE: B-210435.2 85-1 CPD 196
DATE: February 14, 1985
MATTER OF: Julie Research Laboratories, Inc.
DIGEST:
FOREIGN GOVERNMENTS - DEFENSE ARTICLES AND SERVICES - ARMS EXPORT
CONTROL ACT - FOREIGN MILITARY SALES PROGRAM - COMPETITION REQUIREMENT
INAPPLICABILITY - SOLE-SOURCE AWARD REQUESTED
The Army properly may specify sole sources for items being purchased
to implement a foreign military sale (FMS), where the FMS customer
requests the particular sources.
Julie Research Laboratories, Inc. (JRL) protests that the Department
of the Army's solicitation No. DAAH01-84-R-0360 unduly restricts
competition. The solicitation implements a foreign military sale (FMS)
-- under the Arms Export Control Act, as amended, 22 U.S.C. Section
2751-2796c (1982) -- to Egypt of a "Secondary Reference Calibration Set"
and spare parts, and requires certain brand name components specifically
requested by Egypt. A secondary reference calibration set includes
equipment required to calibrate intricate weapons and communications
systems. JRL, a calibration equipment manufacturer, protests that the
brand name designations violate the fundamental requirement for maximum
practicable competition in federal procurements. JRL points out that
this solicitation involves the same basic requirement as did a previous
solicitation (No. DAAH01-83-B-A032) that JRL had protested was unduly
restrictive, and which the Army canceled after finding some merit to
JRL's protest.
We deny the protest.
Egypt's original request for a calibration set stated that the United
States should furnish "standard items," that is, identical items to
those in the Army's inventory. Such items exist in either the Army's
relatively small number of reference laboratories or in the 143
secondary transfer laboratories which utilize standardized calibration
sets that apparently are intended as field equipment and are required to
be more mobile than secondary reference sets. In this connection,
standardized requirements for secondary transfer sets derive from a 1978
multi-year procurement that did not require particular brands of
components. In reviewing the Army's decision to standardize future
procurements of secondary transfer sets, our Office held that the
decision was a proper means to avoid the burden and expense of
maintaining additional spare parts, multiple maintenance and repair
manuals, and having to conduct additional training. Julie Research
Laboratories, Inc., B-199416, June 16, 1981, 81-1 C.P.D. Paragraph 493.
In further regard to Egypt's first request, where standard components
in the Army's inventory were no longer commercially available, or where
accessory items were needed, the Army itself specified certain brand
name items. The procurement regulations then in effect (Defense
Acquisition Regulation, Section 6-1307(a), 32 C.F.R. Section 6-1307(a)
(1982)), however, provided that purchases for FMS customers must be
implemented under normal acquisition procedures, including the
requirement for competition unless the customer designates a particular
source. The Army determined that it had failed to seek competition for
these components, and canceled the solicitation.
After the cancellation, Egypt provided the precise specifications
used by the Army in the current solicitation. JRL suggests that the
Army itself composed these specifications and that Egypt simply adopted
them.
The procurement regulations that govern an FMS procurement provide,
in part, that a contracting officer "shall honor requests for sole
source prime and subcontracts from the FMS customer." Department of
Defense Federal Acquisition Regulation (DOD FAR) Supplement, Section
25.7307(a), 48 C.F.R. Section 225.7307(a) (1984). This instruction, not
the federal statutes and regulations generally pertaining to
procurements by or for federal agencies using United States appropriated
funds, governs this case since the United States administers the FMS
customer's funds as a trustee for the customer. Allied Repair Service,
Inc., 62 Comp. Gen. 100 (1982), 82-2 C.P.D. Paragraph 541; Julie
Research Laboratories, Inc., B-216312, Nov. 30, 1984, 84-2 C.P.D.
Paragraph 613.
While the United States sometimes loans the FMS customer funds for
the sale, that does not change the nature of the United States' role as
essentially the FMS customer's agent in the procurement and a trustee of
its funds; federal procurement laws and regulations therefore are not
applicable to FMS procurements except to the extent they specifically
provide so. See Procurements Involving Foreign Military Sales, 58 Comp.
Gen. 81 (1978), 78-2 C.P.D. Paragraph 349. Although the DOD FAR
Supplement, Section 25.7307(a), states that the FAR, including its
general requirement for competition, applies to FMS procurements, it
provides a specific exception where the FMS customer requests a sole
source.
Thus, Egypt's second request had legal consequences different from
those of its first: while the Army was required to maximize competition
before Egypt requested a sole source, that requirement ceased to apply
when Egypt designated specific sources.
Concerning JRL's allegation that the Army coached Egypt as to what
items to request, which we note the Army denies, we are unaware of any
legal impediment to the Army's advising an FMS customer as to what items
might best satisfy its needs, and therefore we find it immaterial
whether or not the current specifications initially were devised by the
Army and recommended to Egypt.
Our view on this last matter might differ if it were shown that the
Army sought to have Egypt request certain sources, concerning which
Egypt was otherwise indifferent, for the sole purpose of circumventing
the requirement for competition. Aside from speculation, however, JRL
has presented no evidence to show such was the case. Contracting
officials are presumed to act in good faith, and a party attempting to
show otherwise must present well-nigh irrefutable proof that they had a
specific and malicious intent to harm the party. See Kalvar Corp., Inc.
v. United States, 543 F.2d 1298 (Ct. Cl. 1976), cited in Arlandria
Construction Co., Inc. -- Reconsideration, B-195044; B-195510, July 9,
1980, 80-2 C.P.D. Paragraph 21. In this respect, JRL emphasizes that
the Army has admitted that some of its technical personnel involved in
preparing the specifications for the canceled solicitation had
misrepresented certain items as being standard when they were not. That
fact, however, does not show that the Army has acted improperly
regarding the current solicitation. In addition, JRL argues that the
Army's report responding to the protest contains a basic inconsistency
in that it portrays Egypt's selection of components as reasonable based
upon the savings of utilizing spare parts and training materials already
in the Army's inventory, while at the same time admitting that certain
components are not standard. We agree that there is an inconsistency,
but we see no basis to view it as rising to the level of nearly
irrefutable proof that Army officials acted with the intention to harm
JRL.
JRL also argues that the Army failed to comply with a Department of
Defense (DOD) manual which states that an FMS customer is required to
justify a sole-source request, and that such a request will not be
honored in any case of patently arbitrary, capricious or discriminatory
exclusion of other sources. /1/
The manual, by its own terms, is an internal instructional manual for
DOD personnel, and therefore sets forth executive branch policy that
lacks the force and effect of law. See Timeplex, Inc., et al., B-197346
et al., Apr. 13, 1981, 81-1 C.P.D. Paragraph 280. In any event, the
Army evidently determined that Egypt's request for specific brand name
components was not patently arbitrary. It is not our function to
determine whether Egypt's request satisfied the Army's manual and, on
that basis, to judge the legality of the resultant award.
The protest is denied.
Comptroller General
of the United States
FOOTNOTES
(1) DOD Manual 5105.38-M, "Security Assistance Management Manual,"
Ch. 8, Section II, B.1 (1984).
B-210434, FEB 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST ALLEGATION THAT THE DELIVERY SCHEDULE IN AN RFP IS UNDULY
RESTRICTIVE IS UNTIMELY AND NOT FOR CONSIDERATION ON THE MERITS SINCE
THE PROTEST WAS NOT FILED PRIOR TO THE CLOSING DATE FOR RECEIPT OF
INITIAL PROPOSALS.
ALABAMA METAL PRODUCTS CO.:
ALABAMA METAL PRODUCTS CO. (AMPCO) PROTESTS THE AWARD OF ANY CONTRACT
UNDER REQUEST FOR PROPOSALS (RFP) NO. YNPS-SI-1406-N-12-30-82, ISSUED BY
THE GENERAL SERVICES ADMINISTRATION (GSA) FOR SEVERAL FURNITURE ITEMS.
AMPCO CONTENDS THAT THE RFP IS UNDULY RESTRICTIVE BECAUSE IT CONTAINS A
DELIVERY SCHEDULE WHICH IT IS UNABLE TO MEET. AMPCO CLAIMS IT COULD
COMPETE AND OFFER THE GOVERNMENT A LOWER PRICE IF THE DELIVERY SCHEDULE
WERE EXTENDED BY 1 MONTH. WE DISMISS THE PROTEST AS UNTIMELY FILED.
UNDER OUR BID PROTEST PROCEDURES, PROTESTS BASED ON ALLEGED DEFECTS
APPARENT ON THE FACE OF AN RFP MUST BE FILED PRIOR TO THE CLOSING DATE
FOR RECEIPT OF INITIAL PROPOSALS. SEE 4 C.F.R. SEC. 21.2(B)(1).
AMPCO'S CONTENTION THAT THE DELIVERY SCHEDULE WAS UNDULY RESTRICTIVE
CLEARLY IS BASED ON INFORMATION CONTAINED IN THE RFP. THUS, AMPCO WAS
REQUIRED TO ASSERT THIS GROUND OF PROTEST PRIOR TO THE DECEMBER 30, 1982
CLOSING DATE FOR RECEIPT OF INITIAL PROPOSALS. BECAUSE AMPCO'S PROTEST
WAS NOT RECEIVED IN OUR OFFICE UNTIL JANUARY 11, IT IS UNTIMELY AND WILL
NOT BE CONSIDERED ON THE MERITS. SEE PHOENIX POWER SYSTEMS, INC.,
B-207818, JULY 1, 1982, 82-2 CPD 11.
THE PROTEST IS DISMISSED.
B-210433, APR 15, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT OBJECT TO THE DEPARTMENT OF THE NAVY'S USE OF
APPROPRIATED FUNDS TO PURCHASE A MICROWAVE OVEN, WHERE A PROPER OFFICIAL
DETERMINES THAT THE EXPENDITURE IS NECESSARY IN VIEW OF THE WORK HOURS
INVOLVED AND THE LACK OF AVAILABLE EATING FACILITIES.
PURCHASE OF MICROWAVE OVEN:
THIS IS AN ADVANCE DECISION TO THE CHIEF, BUREAU OF MEDICINE AND
SURGERY (RECENTLY REDESIGNATED THE NAVAL MEDICAL COMMAND), DEPARTMENT OF
THE NAVY, CONCERNING WHETHER, UNDER THE STATED CIRCUMSTANCES, THE BUREAU
MAY USE APPROPRIATED FUNDS TO PURCHASE A MICROWAVE OVEN FOR ITS
WASHINGTON, D. C. HEADQUARTERS. FOR REASONS WHICH FOLLOW, WE FIND THAT
APPROPRIATED FUNDS MAY BE USED FOR THIS PURPOSE.
ACCORDING TO THE SUBMISSION, THE OVEN, IF PURCHASED, WILL REPLACE A
NON-WORKING STOVE AND WILL BE USED BY EMPLOYEES OF THE DUTY SECTION AND
THE CRYPTO CENTER. THESE LOCATIONS OPERATE 7 DAYS PER WEEK, 24 HOURS
PER DAY. WE ARE TOLD THAT DUTY SECTION EMPLOYEES MUST REMAIN AT THEIR
DUTY STATIONS FOR 24-HOUR SHIFTS AND CRYPTO CENTER EMPLOYEES FOR 8-HOUR
SHIFTS. THE SUBMISSION FURTHER NOTES THAT DURING NIGHTS AND WEEKENDS,
THERE ARE NO READILY ACCESSIBLE EATING FACILITIES IN THE AREA.
THE ISSUE HERE IS WHETHER THE PURCHASE OF A MICROWAVE OVEN MAY BE
CONSIDERED A "NECESSARY EXPENSE" OF OPERATING THE FACILITY. IF IT CAN,
THEN THE EXPENDITURE IS PROPER. IF IT CANNOT, THEN THE EXPENDITURE
WOULD VIOLATE 31 U.S.C. SEC. 1301(A) (FORMERLY 31 U.S.C. SEC. 628),
WHICH PROHIBITS THE USE OF APPROPRIATED FUNDS FOR OTHER THAN THEIR
INTENDED PURPOSES. THE RULE IS THAT WHERE AN APPROPRIATION DOES NOT
SPECIFICALLY PROVIDE FOR A PARTICULAR ITEM, ITS PURCHASE MAY BE FOUND A
"NECESSARY EXPENSE" IF IT IS NOT OTHERWISE PROHIBITED AND IF A PROPER
AGENCY OFFICIAL DETERMINES THAT THE PURCHASE HAS A DIRECT CONNECTION
WITH AND IS ESSENTIAL TO CARRYING OUT THE GENERAL PURPOSE FOR WHICH THE
FUNDS WERE APPROPRIATED. THE AGENCY HAS CONSIDERABLE DISCRETION IN
MAKING THIS DETERMINATION.
IN B-180272, JULY 23, 1974, WE DID NOT OBJECT TO THE PURCHASE OF A
REFRIGERATOR, SINK, AND RELATED EQUIPMENT TO PROVIDE KITCHEN-LUNCHROOM
FACILITIES FOR EMPLOYEES OF THE OCCUPATIONAL SAFETY AND HEALTH REVIEW
COMMISSION WHERE THERE WAS NO GOVERNMENT CAFETERIA ON THE PREMISES. WE
HAVE ALSO PERMITTED THE FEDERAL AVIATION ADMINISTRATION TO PURCHASE
COOKING UTENSILS FOR EMPLOYEES AT AN AIR TRAFFIC CONTROL CENTER.
B-173149, AUGUST 10, 1971. IN THAT CASE, THE AGENCY HEAD FOUND THAT
PURCHASE OF THE COOKING UTENSILS WAS A NECESSARY EXPENSE BECAUSE THE
FACILITY OPERATED 7 DAYS PER WEEK, 24 HOURS PER DAY, THE AIR TRAFFIC
CONTROLLERS HAD TO BE CONTINUOUSLY AVAILABLE DURING AN 8-HOUR SHIFT, AND
NO NEARBY EATING FACILITIES EXISTED. THESE CASES ARE READILY
DISTINGUISHABLE FROM THE LONG LINE OF DECISIONS PROHIBITING THE USE OF
APPROPRIATED FUNDS TO PROVIDE FREE FOOD FOR GOVERNMENT EMPLOYEES WORKING
AT THEIR NORMAL DUTY STATION EVEN UNDER DIFFICULT OR UNUSUAL
CIRCUMSTANCES.
THE PRESENT SITUATION, AS OUTLINED IN THE SUBMISSION, APPEARS TO BE
VERY SIMILAR TO B-173149, NOTED ABOVE. APPLYING THAT DECISION, THE
STOVE ITSELF WOULD APPEAR PERMISSIBLE, AND NAVY'S APPROPRIATIONS ARE
THEREFORE AVAILABLE FOR ITS REPAIR OR REPLACEMENT. IN THIS CASE, NAVY
HAS DETERMINED THAT REPAIR IS NOT ECONOMICALLY FEASIBLE. WHILE A
MICROWAVE OVEN MAY PERHAPS BE MORE EXPENSIVE THAN OTHER ALTERNATIVES, IT
IS STILL ESSENTIALLY THE REPLACEMENT OF EXISTING EQUIPMENT, AND THE NAVY
MAY WELL DETERMINE THAT THE ADDITIONAL EXPENSE, WITHIN REASON, IS
JUSTIFIED BY OTHER FACTORS SUCH AS TIME SAVINGS. IN ADDITION, THERE IS
NO INDICATION THAT THE PURPOSE OF THE OVEN IS TO PROVIDE REFRESHMENTS
FOR MEETINGS OR FOR GUESTS. SEE, E.G., 47 COMP.GEN. 657 (1968);
B-173149, SUPRA. ACCORDINGLY, WE WILL NOT OBJECT TO THE PURCHASE OF THE
MICROWAVE OVEN IF A PROPER AGENCY OFFICIAL DETERMINES THAT THE PURCHASE
IS REASONABLY NECESSARY TO CARRY OUT THE PURPOSES OF THE APPROPRIATION
TO BE CHARGED.
B-210427, B-210427.2, B-210997, FEB 23, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTESTER BEARS THE RESPONSIBILITY FOR THE
DELIVERY OF QUOTATIONS. PROTEST IS DENIED BECAUSE PROTESTER HAS
NOT AFFIRMATIVELY PROVEN THAT IT SUBMITTED QUOTATIONS THE
PROCURING AGENCY CLAIMS IT DID NOT RECEIVE.
2. PROTEST ALLEGING THAT VARIOUS SOLICITATIONS
FOR SPARE PARTS WERE DEFECTIVE BECAUSE THEY REQUIRED
NONMANUFACTURERS OFFERING TO SUPPLY PARTS MADE BY THE APPROVED
MANUFACTURERS LISTED IN THE SOLICITATION TO SUBMIT DOCUMENTATION
SHOWING THAT THEY WERE EITHER AUTHORIZED DEALERS FOR THE LISTED
MANUFACTURER'S PARTS OR THAT THEY INTENDED TO OBTAIN THE PARTS
FROM THE MANUFACTURER LISTED IN THE SOLICITATION OR AN AUTHORIZED
DEALER IS UNTIMELY WHERE THE ALLEGED DEFECT WAS APPARENT FROM THE
FACE OF THE SOLICITATION, BUT THE PROTEST WAS NOT FILED UNTIL
AFTER THE CLOSING DATES FOR RECEIPT OF QUOTATIONS.
UNITED AIRCRAFT AND TURBINE CORPORATION:
UNITED AIRCRAFT AND TURBINE CORPORATION (UATC) PROTESTS THE AWARD OF
21 PURCHASE ORDER CONTRACTS ISSUED BY THE DEFENSE INDUSTRIAL SUPPLY
CENTER (DISC) OF THE DEFENSE LOGISTICS AGENCY. UATC CONTENDS THAT IT
WAS THE LOW OFFEROR ON EACH OF THE SOLICITATIONS, BUT STILL DID NOT
RECEIVE THE AWARDS. WE DENY THE PROTEST IN PART AND DISMISS THE PROTEST
IN PART.
THE AGENCY CONDUCTED ALL OF THE PROCUREMENTS - FOR VARIOUS SPARE
PARTS - UNDER THE DEFENSE ACQUISITION REGULATION (DAR) SMALL PURCHASE
PROCEDURES, DAR SEC. 3-600 ET SEQ., USING ITS AUTOMATED PURCHASING
SYSTEM UNDER WHICH SOLICITATIONS WERE GENERATED BY COMPUTER AND THE
RESPONSES COMPUTER EVALUATED. EACH OF THE SOLICITATIONS IDENTIFIED THE
PART REQUIRED BY A MANUFACTURER'S CODE AND A PART NUMBER AND SPECIFIED
THAT ONLY THESE ITEMS OR ITEMS FROM ANOTHER PREVIOUSLY APPROVED SOURCE
WOULD BE ACCEPTABLE. THE SOLICITATIONS ALSO INCORPORATED A PROVISION
(CLAUSE L06) WHICH STATED THAT NONMANUFACTURERS OFFERING TO SUPPLY THE
MANUFACTURER'S PART CITED IN THE SOLICITATION WERE REQUIRED TO SUBMIT
(1) DOCUMENTARY EVIDENCE THAT IT WAS AN AUTHORIZED DEALER OF THE
APPROVED MANUFACTURER, OR (2) A COPY OF THE QUOTATION OR INVOICE WHICH
ESTABLISHED THAT THE OFFEROR OBTAINED THE ITEM FROM THE MANUFACTURER OR
ITS AUTHORIZED DEALER. THE CLAUSE CAUTIONED NONMANUFACTURERS THAT
OFFERS SUBMITTED WITHOUT THIS EVIDENCE WOULD BE TREATED AS TECHNICALLY
UNACCEPTABLE.
UATC CONTENDS THAT IT SUBMITTED TIMELY QUOTATIONS UNDER ALL 21 OF THE
PROCUREMENTS. HOWEVER, DISC'S RECORDS DO NOT INDICATE THE RECEIPT OF
UATC QUOTATIONS ON 11 OF THE PROCUREMENTS. UATC ASSERTS IMPROPER
GOVERNMENT ACTION, BUT HAS NOT SUBMITTED ANY EVIDENCE TO SUPPORT ITS
CONTENTION. UATC'S PROTEST AS TO THESE 11 PROCUREMENTS IS ACCORDINGLY
DENIED BECAUSE UATC HAS NOT SATISFIED ITS BURDEN OF PROVING THE TIMELY
SUBMISSION OF ITS QUOTATIONS OR IMPROPER GOVERNMENT ACTION. M-F
SERVICES, INC., B-210954, JANUARY 20, 1984, 84-1 CPD ; UNITED AIRCRAFT
AND TURBINE CORPORATION, B-210052, JULY 6, 1983, 83-2 CPD 58. IN ANY
EVENT, EVEN IF UATC COULD SHOW THAT THE AGENCY MISPLACED ITS QUOTATIONS,
WE HAVE HELD THAT WE WILL NOT DISTURB A SMALL PURCHASE AWARD ON SUCH A
BASIS ABSENT EVIDENCE OF A CONSCIOUS OR DELIBERATE EFFORT BY THE
CONTRACTING OFFICER TO PREVENT THE SELECTION OF THE PROTESTER. SEE R.E.
WHITE & ASSOCIATES, INC., B-211333, JUNE 28, 1983, 83-2 CPD 38. THERE
IS NO EVIDENCE THAT SUCH WAS THE CASE HERE. INDEED, WE FOUND IN UNITED
AIRCRAFT AND TURBINE CORPORATION, B-210710, AUGUST 29, 1983, 83-2 CPD
267, THAT UATC HAS RECEIVED A NUMBER OF AWARDS FROM DISC AND IS NOT
BEING DELIBERATELY EXCLUDED FROM COMPETITION.
DISC DID RECEIVE UATC'S QUOTATIONS ON THE REMAINING 10 PROCUREMENTS.
UATC WAS THE LOW OFFEROR ON NINE OF THESE PROCUREMENTS. DISC STATES
THAT UATC DID NOT RECEIVE AWARD ON THE NINE PROCUREMENTS BECAUSE UATC, A
NONMANUFACTURER, FAILED TO SUBMIT THE DATA REQUIRED BY CLAUSE L06. THE
TENTH PROCUREMENT WAS AWARDED TO FASTNER DEPOT BECAUSE IT SUBMITTED THE
LOW QUOTATION.
THE PROTESTER DOES NOT DISPUTE THE AGENCY'S POSITION THAT IT DID NOT
SUPPLY THE REQUIRED DATA WITH ITS QUOTATIONS, BUT INSTEAD CHALLENGES THE
PROPRIETY OF CLAUSE L06. UATC CONTENDS THAT THE CLAUSE UNNECESSARILY
RESTRICTS COMPETITION TO ORIGINAL EQUIPMENT MANUFACTURERS (OEM'S) AND
AUTHORIZED DEALERS.
WE RECOGNIZE THAT RECENT INVESTIGATIONS OF DEPARTMENT OF DEFENSE
SPARE PARTS PROCUREMENTS, INCLUDING DLA'S, HAVE REVEALED INSTANCES IN
WHICH COMPETITION HAS BEEN UNNECESSARILY RESTRICTED. SEE HOUSE
COMMITTEE ON GOVERNMENT OPERATIONS, "FAILURE TO IMPLEMENT EFFECTIVELY
THE DEFENSE DEPARTMENT'S HIGH DOLLAR SPARE PARTS BREAKOUT PROGRAM IS
COSTLY," H.REP. NO. 512, 98TH CONG., 1ST SESS. (1983). HOWEVER, THE
PROTESTER'S CONTENTION THAT IT WAS UNNECESSARY TO INCLUDE CLAUSE L06 IN
THE SOLICITATIONS IS UNTIMELY. THIS ARGUMENT INVOLVES AN ALLEGED DEFECT
IN THE SOLICITATIONS WHICH WAS APPARENT FROM THE FACE OF THESE
SOLICITATIONS. THEREFORE, UNDER OUR BID PROTEST PROCEDURES, 4 C.F.R.
SEC. 21.2(B)(1) (1983), UATC WAS REQUIRED TO FILE ITS PROTEST PRIOR TO
THE CLOSING DATES FOR THE RECEIPT OF QUOTATIONS. SINCE UATC DID NOT
FILE ITS PROTEST UNTIL AFTER THE AWARDS, THIS ARGUMENT IS UNTIMELY AND
WILL NOT BE CONSIDERED. M-F SERVICES, INC., SUPRA. MOREOVER, UATC HAS
FAILED TO OFFER ANY PROOF TO REFUTE DISC'S CONTENTION THAT ALL OF THE
SPARE PARTS PROCURED UNDER THESE SOLICITATIONS WERE CRITICAL PARTS THAT
MUST NECESSARILY BE RESTRICTED. SEE MERCER PRODUCTS & MANUFACTURING
CO., INC., B-210536, OCTOBER 12, 1983, 83-2 CPD 449. THIS GROUND OF
PROTEST IS ACCORDINGLY DISMISSED. UATC'S PROTEST AGAINST THE AWARD OF A
CONTRACT TO FASTNER DEPOT IS DENIED BECAUSE UATC WAS NOT THE LOW
OFFEROR.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
B-210424, FEB 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST AGAINST REJECTION OF BID FILED WITH GAO MORE THAN 10 WORKING
DAYS AFTER BASIS FOR PROTEST IS KNOWN IS UNTIMELY AND NOT FOR
CONSIDERATION UNDER BID PROTEST PROCEDURES.
CRAFT MANUFACTURING DIVISION:
THE CRAFT MANUFACTURING DIVISION (CRAFT) OF THE UNIVERSAL LOGISTICS
CORPORATION PROTESTS THE REJECTION OF ITS BID UNDER UNITED STATES ARMY
TANK-AUTOMOTIVE COMMAND INVITATION FOR BIDS NO. DAAE07-82-B-B554.
WE DISMISS THE PROTEST AS UNTIMELY.
OUR BID PROTEST PROCEDURES AT 4 C.F.R. SEC. 21.2(B)(2) (1982) PROVIDE
THAT IN ORDER FOR A PROTEST TO BE CONSIDERED BY OUR OFFICE, IT MUST BE
FILED WITHIN 10 WORKING DAYS AFTER THE BASIS FOR THE PROTEST IS KNOWN TO
THE PROTESTER. THE PROTEST STATES THAT ON DECEMBER 6, 1982, CRAFT WAS
INFORMED BY THE CONTRACTING OFFICER OF THE BASIS OF THE REJECTION OF THE
CRAFT BID. THE PROTEST WAS RECEIVED IN OUR OFFICE ON JANUARY 10, 1983,
MORE THAN 10 WORKING DAYS AFTER CRAFT WAS INFORMED OF THE REASON FOR THE
REJECTION OF ITS BID.
B-210423.2, MAR 9, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
AFTER DENYING PLAINTIFF'S REQUEST FOR TEMPORARY
RESTRAINING ORDER, PRELIMINARY
INJUNCTION AND PERMANENT INJUNCTION WITHOUT
REQUESTING OPINION FROM GAO ON PLAINTIFF'S
PROTEST CONCERNING SAME ISSUES, COURT DISMISSED
SUIT ON CONDITION THAT PLAINTIFF
NOT BRING SAME ISSUES TO ANOTHER COURT.
GAO WILL NOT CONSIDER THE PROTEST, EVEN
THOUGH COURT INDICATED IN DISMISSAL THAT
PLAINTIFF COULD PURSUE GAO DECISION, SINCE
COURT ALREADY ADJUDICATED THE MATTER AND
IT WOULD BE INAPPROPRIATE TO PROVIDE A
SECOND FORUM.
DECISION PLANNING CORPORATION:
DECISION PLANNING CORPORATION (DPC) PROTESTS THE AWARD OF A CONTRACT
BY THE DEPARTMENT OF ENERGY (DOE) TO SYSTEMATIC MANAGEMENT SERVICES,
INC. (SMS) UNDER REQUEST FOR PROPOSALS (RFP) NO. DE-RP02-83-CH10128 FOR
CONSULTING SERVICES. DPC CONTENDS THAT THE AWARD IS UNLAWFUL AND IN
VIOLATION OF THE TERMS OF THE RFP AND DOE REGULATIONS. DPC FURTHER
CONTENDS THAT DOE'S FAILURE TO FOLLOW THE SPECIFIED EVALUATION CRITERIA
AND PROCEDURES IN SELECTING SMS FOR AWARD WAS ARBITRARY, CAPRICIOUS AND
AN ABUSE OF DISCRETION.
WE DISMISS THE PROTEST.
THE SOLICITATION WAS ISSUED IN OCTOBER 1982. AFTER NEGOTIATIONS AND
BEST AND FINAL OFFERS, THE SOURCE EVALUATION BOARD (SEB) DETERMINED THAT
DPC'S TECHNICAL PROPOSAL WAS SO MUCH BETTER THAN THAT OF SMS THAT
ACCEPTANCE OF DPC'S HIGHER-PRICED PROPOSAL WAS JUSTIFIED. DOE THEREFORE
SELECTED DPC FOR NEGOTIATIONS WITH THE INTENT TO AWARD TO THE FIRM. SMS
THEN PROTESTED TO OUR OFFICE, OBJECTING TO THE SELECTION ON MANY
DIFFERENT GROUNDS. BEFORE WE COULD RESOLVE THE MATTER, HOWEVER, DOE
DECIDED TO REINSTATE SMS, AND TO REOPEN NEGOTIATIONS WITH BOTH FIRMS.
DPC THEN FILED A PROTEST WITH OUR OFFICE AGAINST THE AGENCY'S DECISION,
CONTENDING THAT DOE FURNISHED SMS INFORMATION THAT RESULTED IN IMPROPER
TECHNICAL TRANSFUSION FROM DPC'S PROPOSAL.
DOE WAS THEN IN THE MIDST OF THE REOPENED NEGOTIATIONS, AND WAS
RELUCTANT TO SUBMIT A REPORT ON EITHER PROTEST BECAUSE IT FELT THAT IT
WAS IMPOSSIBLE TO DO SO BEFORE THE NEW SELECTION WITHOUT COMPROMISING
THE ONGOING NEGOTIATIONS. THE AGENCY SUGGESTED THAT AS SOON AS THE NEW
SELECTION WAS MADE, A REPORT COULD BE MADE WITHOUT ITS AFFECTING THE
COMPETITION.
AFTER BEST AND FINAL OFFERS WERE RECEIVED IN JULY 1983, DOE
DETERMINED THAT THE LEVEL OF EFFORT SHOULD BE REDUCED FROM 20 MAN YEARS
OF EFFORT PER YEAR TO 14 MAN YEARS OF EFFORT. NEW BEST AND FINAL OFFERS
WERE RECEIVED ON AUGUST 5, AND THIS TIME THE SEB DETERMINED THAT SMS'S
PRICE WAS SUFFICIENTLY LOWER THAN DPC'S TO OVERCOME THE BENEFITS TO BE
DERIVED FROM THE SUPERIOR TECHNICAL PROPOSAL SUBMITTED BY DPC.
DPC SUBSEQUENTLY RENEWED ITS ORIGINAL PROTEST, AND ALSO PROTESTED THE
NEW SELECTION OF SMS AS, AMONG OTHER THINGS, IN VIOLATION OF THE
REGULATIONS, CONTRARY TO THE SPECIFIED EVALUATION CRITERIA, BASED ON
ERRONEOUS CALCULATIONS OF PROBABLE COSTS, AND RESULTING FROM TECHNICAL
TRANSFUSION AND LEVELING. DOE THEN STARTED PREPARATION OF ITS REPORT ON
THE DPC PROTEST.
BEFORE THIS REPORT WAS COMPLETE, DPC FILED SUIT IN THE UNITED STATES
CLAIMS COURT SEEKING DECLARATORY AND INJUNCTIVE RELIEF (CIVIL ACTION NO.
637-83C) AND PRESENTING THE SAME ISSUES PRESENTED TO OUR OFFICE IN THE
PROTEST. IN ACCORDANCE WITH OUR USUAL POLICY, WE SET THE PROTEST ASIDE
UNTIL THE DESIRES OF THE COURT WITH RESPECT TO OBTAINING OUR VIEW COULD
BE CLARIFIED. SEE NORFOLK DREDGING COMPANY, B-209099, DECEMBER 22,
1982, 82-2 CPD 567. DPC DID NOT, HOWEVER, ASK THE COURT TO REQUEST AN
ADVISORY OPINION FROM OUR OFFICE, AND THE COURT DID NOT EXPRESS ITS
DESIRE FOR SUCH AN OPINION.
AFTER A FULL DAY OF ORAL ARGUMENT, THE COURT, ON OCTOBER 28, ISSUED A
7-PAGE ORDER IN WHICH IT CONCLUDED THAT THE PROBABILITY OF DPC
ULTIMATELY PREVAILING ON THE MERITS WAS LACKING. THE COURT ALSO
CONCLUDED THAT THE MATERIALS PRESENTED TO IT BY THE PARTIES SHOWED THAT
DOE HAD FOLLOWED THE SPECIFIED PROPOSAL EVALUATION CRITERIA, THAT SMS
HAD AT LEAST MINIMALLY COMPLIED WITH ALL REQUIREMENTS, AND THAT THE
SOURCE SELECTION OFFICIAL HAD NOT ABUSED HIS DISCRETION IN SELECTING SMS
FOR AWARD. THE ORDER THEN DENIED DPC'S MOTION FOR A TEMPORARY
RESTRAINING ORDER (TRO) AND ITS REQUESTS FOR A PRELIMINARY INJUNCTION
AND A PERMANENT INJUNCTION.
PROMPTLY AFTER THE COURT'S ORDER, DOE AWARDED THE CONTRACT TO SMS.
DPC DID NOT APPEAL FROM THE COURT'S ORDER OF OCTOBER 28, BUT ON NOVEMBER
3, FILED A NOTICE OF DISMISSAL WITHOUT PREJUDICE UNDER RULE 41(A)(1) OF
THE FEDERAL RULES OF CIVIL PROCEDURE (FRCP). AFTER A HEARING AT WHICH
DOE AND SMS OPPOSED THIS DISMISSAL, THE COURT, ON NOVEMBER 10, DISMISSED
DPC'S COMPLAINT, STATING THAT THE DISMISSAL WAS UNDER RULE 41(A)(2)
RATHER THAN RULE 41(A)(1) "IN ORDER TO AVOID CARPING ABOUT DISMISSAL
UNDER RULE 41(A)(1)." THE ORDER FURTHER STATED THAT THE COURT'S
DISMISSAL WAS MOTIVATED IN LARGE PART BY DPC'S ASSERTION THAT IT DID NOT
WANT TO RELITIGATE THE ISSUES INVOLVED IN ANY COURT OF COMPETENT
JURISDICTION, AND NOTED DPC'S STATED DESIRE TO DISMISS VOLUNTARILY "THAT
PART OF ITS CLAIM REMAINING" IN ORDER TO PERMIT OUR OFFICE TO DECIDE THE
PROTEST. RULE 41(A)(1) PROVIDES FOR VOLUNTARY DISMISSALS BY THE
PLAINTIFF WITHOUT ORDER OF THE COURT AND FOR DISMISSALS BY STIPULATION
SIGNED BY ALL PARTIES WHO HAVE APPEARED IN THE ACTION. RULE 41(A)(2)
PROVIDES FOR DISMISSALS BY COURT ORDER, AND STATES THAT UNLESS OTHERWISE
SPECIFIED IN THE COURT, SUCH A DISMISSAL IS WITHOUT PREJUDICE.
DOE CONTENDS THAT WE SHOULD DISMISS DPC'S PROTEST BECAUSE THE ISSUES
IT INVOLVES WERE PRESENTED TO THE COURT AND THE COURT, AFTER FULL
CONSIDERATION, FOUND THAT THERE WAS NO LIKELIHOOD OF DPC PREVAILING ON
THE MERITS OF ITS COMPLAINT. DOE ARGUES THAT DPC'S DECISION TO PURSUE A
DISMISSAL WITHOUT PREJUDICE RATHER THAN APPEAL THE COURT'S ACTION IS
SIMPLY AN EFFORT TO INDUCE THIS OFFICE TO CONSIDER AND RESOLVE THE SAME
ISSUES THE COURT FOUND TO HAVE NO SUBSTANCE. TO PERMIT DPC TO
ACCOMPLISH THIS WOULD, DOE SUBMITS, BE TANTAMOUNT TO GIVING DPC AN
UNDESERVED SECOND HEARING.
DPC OPPOSES THE DISMISSAL OF ITS PROTEST, CONTENDING THAT THE COURT
DID EXPRESS A DESIRE TO HAVE A RULING FROM OUR OFFICE, AND THAT
THEREFORE THIS MATTER COMES WITHIN THE EXCEPTION TO OUR GENERAL POLICY
OF NOT DECIDING MATTERS WHICH HAVE BEEN BEFORE A COURT OF COMPETENT
JURISDICTION. DPC ARGUES THAT THE DISMISSAL OF ITS COURT ACTION WAS
WITHOUT PREJUDICE, AND CONTENDS THAT THE COURT DID NOT RULE ON ANY
ISSUES OTHER THAN THOSE BROUGHT BEFORE IT FOR PURPOSES OF OBTAINING A
TRO.
WE FIND NO INDICATION IN THE RECORD THAT THE COURT EVER EXPRESSED A
DESIRE FOR A DECISION FROM OUR OFFICE. DPC'S COMPLAINT AND ORAL BRIEF
GAVE NO INDICATION THAT DPC REQUESTED ANYTHING OTHER THAN THAT THE COURT
RESOLVE ALL ISSUES WITHOUT ADVICE FROM THE GENERAL ACCOUNTING OFFICE.
ALTHOUGH THE COURT AT THE HEARING ASKED ABOUT THE STATUS OF THE PROTEST,
IT AT NO TIME ASKED FOR OUR VIEWS ON THE ISSUES, AND NONE OF THE
PARTIES, INCLUDING DPC, ASKED THE COURT TO WITHHOLD ITS DECISION UNTIL
OUR OFFICE ISSUED A DECISION. INDEED, THE TRANSCRIPT INDICATES THAT THE
COURT CONSIDERED THE ADVISABILITY OF REQUESTING THIS OFFICE TO EXPEDITE
ITS DECISION, BUT REJECTED THAT COURSE OF ACTION AFTER STATING THAT AS
THE PARTIES DID NOT SEEM TO BE CONCERNED ABOUT A DECISION FROM OUR
OFFICE, NEITHER WAS THE COURT. IT WAS ONLY AFTER THE COURT ISSUED ITS
ORDER INDICATING ITS BELIEF THAT DPC'S POSITION HAD NO MERIT THAT DPC
DECIDED THAT ITS BEST COURSE OF ACTION WOULD BE TO RETURN TO THIS
OFFICE.
AS A GENERAL RULE, OUR OFFICE WILL NOT DECIDE MATTERS WHERE THE
ISSUES INVOLVED ARE BEFORE A COURT OF COMPETENT JURISDICTION OR HAVE
BEEN DECIDED ON THE MERITS BY SUCH A COURT. 4 C.F.R. SEC. 21.10 (1983).
WE WILL, HOWEVER, REVIEW A COMPLAINT IF THE COURT ACTION HAS BEEN
DISMISSED WITHOUT PREJUDICE. SEE OPTIMUM SYSTEMS INC., 56 COMP. GEN.
934 (1977), 77-2 CPD 165; PLANNING RESEARCH CORPORATION PUBLIC
MANAGEMENT SERVICES, INC., 55 COMP.GEN. 911 (1976), 76-1 CPD 202. THE
REASON IS THAT A DISMISSAL WITHOUT PREJUDICE GENERALLY LEAVES THE
PARTIES IN THE SAME POSITION THEY WOULD HAVE BEEN IF NO COURT ACTION HAD
BEEN BROUGHT. MOORE V. ST. LOUIS MUSIC SUPPLY CO., INC., 539 F.2D 1191
(8TH CIR. 1976).
A DISMISSAL UNDER RULE 41(A) IS, ACCORDING TO THE RULE ITSELF,
WITHOUT PREJUDICE UNLESS OTHERWISE SPECIFIED IN THE ORDER. THE
QUALIFICATION IN THE COURT ORDER DISMISSING DPC'S SUIT THAT THE
DISMISSAL WAS FOUNDED ON THE PLAINTIFF'S ASSERTION THAT IT WOULD NOT
BRING THE SAME ISSUES TO ANOTHER COURT SEEMS TO US TO CONSTITUTE A
DISMISSAL WITH PREJUDICE TO THE PLAINTIFF'S RIGHT TO ATTEMPT TO HAVE THE
MATTER RELITIGATED. CERTAINLY, THE COURT, HAVING DENIED THE PLAINTIFF'S
REQUEST FOR A PERMANENT INJUNCTION AS WELL AS FOR TEMPORARY RELIEF, DID
NOT INTEND BY THE 41(A)(2) DISMISSAL TO PLACE THE PARTIES IN THE SAME
SITUATION THEY WERE IN BEFORE THE LAWSUIT WAS INITIATED. IN EFFECT THEN,
THE JUDICIAL BRANCH HAS FINALLY ADJUDICATED THE PARTIES' RIGHTS IN
CONNECTION WITH DOE'S PROCUREMENT.
AS STATED ABOVE, THE COURT CONSIDERED AND REJECTED THE ADVISABILITY
OF REQUESTING A GAO DECISION BEFORE REVIEWING THE MERITS OF DPC'S
COMPLAINT. IN OUR VIEW, THE FACT THAT THE COURT NEVERTHELESS LEFT DPC
THE OPPORTUNITY TO SEEK A SECOND FORUM - THIS OFFICE - TO HEAR THE
COMPLAINT, DOES NOT MANDATE THAT WE ACCEDE TO DPC'S REQUEST. RATHER, WE
BELIEVE THAT OUR APPROPRIATE COURSE IS TO HONOR THE COURT'S JUDGMENT ON
THE MERITS OF THE ISSUES THAT WERE (OR COULD HAVE BEEN) RAISED, AND
DECLINE TO GIVE DPC A SECOND OPINION.
THE COURT RULED NOT ONLY THAT DPC WAS NOT LIKELY TO PREVAIL ON THE
MERITS IF IT PURSUED THE LITIGATION IN COURT, BUT ALSO DENIED A TRO AND
PRELIMINARY AND PERMANENT INJUNCTIONS - THE PERMANENT INJUNCTION
DECISION INCLUDED OVER DPC'S OBJECTION - ON THE BASIS THAT DOE PROPERLY
FOLLOWED THE RFP FORMAT IN EVALUATING THE COMPETING PROPOSALS, AND THAT
THE SELECTION OF SMS WAS WITHIN THE SOURCE SELECTION OFFICIAL'S
DISCRETION. UNDER THE CIRCUMSTANCES, WE WILL NOT RECONSIDER THE SAME
MATTERS.
THE PROTEST IS DISMISSED.
B-210423.3, MAY 19, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST AGAINST AN RFP'S EVALUATION CRITERIA IS UNTIMELY WHERE IT
WAS NOT FILED BEFORE PROPOSALS WERE DUE.
2. PROTEST CONTENDING PROPOSAL WAS IMPROPERLY DETERMINED TO BE
OUTSIDE OF THE COMPETITIVE RANGE IS DISMISSED AS UNTIMELY BECAUSE IT WAS
FILED MORE THAN 10 WORKING DAYS AFTER THE PROTESTER RECEIVED A
DEBRIEFING, WHEN THE FIRM KNEW THE REASONS FOR THE AGENCY'S ACTION.
DECISION MANAGEMENT COMPANY, INC.:
DECISION MANAGEMENT COMPANY, INC. (DMC) PROTESTS THE DEPARTMENT OF
ENERGY'S (DOE) DETERMINATION THAT ITS PROPOSAL FOR PROJECT CONTROL
SERVICES SUBMITTED IN RESPONSE TO REQUEST FOR PROPOSALS (RFP) NO.
DE-RP02-83-CH10128 WAS OUTSIDE OF THE COMPETITIVE RANGE. DMC ALSO
COMPLAINS ABOUT THE EVALUATION SCHEME ESTABLISHED IN THE RFP, WHICH THE
FIRM CONTENDS RESULTED IN AN UNFAIR COMPETITIVE ADVANTAGE FOR ITS
COMPETITORS.
DMC'S PROTEST, RECEIVED IN OUR OFFICE ON APRIL 5, 1983, IS DISMISSED
AS UNTIMELY UNDER OUR BID PROTEST PROCEDURES, 4 C.F.R. PART 21 (1983).
DMC STATES THAT IT WAS INFORMED IN DECEMBER 1982 THAT ITS PROPOSAL
WAS NOT WITHIN THE COMPETITIVE RANGE BECAUSE OTHER PROPOSALS RECEIVED
RATINGS THAT EXCEEDED BY SIGNIFICANT MARGINS THE RATINGS RECEIVING BY
DMC'S PROPOSAL, AND THAT NO FURTHER DISCUSSIONS WITH DMC WERE
CONTEMPLATED. DMC INFORMED DOE ON DECEMBER 20 OF ITS INTENT TO TAKE
ACTION NECESSARY TO ASCERTAIN WHETHER THE PROCUREMENT WAS PROPER AND
FAIR. ON JANUARY 21, 1983, DMC FILED A REQUEST UNDER THE FREEDOM OF
INFORMATION ACT (FOIA) FOR COPIES OF ALL PROPOSALS FOUND TO BE WITHIN
THE COMPETITIVE RANGE, EVALUATION NOTES, AND SCORING RECORDS AND
RATIONALE, AS WELL AS A GREAT DEAL OF OTHER MATERIAL. DMC WAS GIVEN A
FULL DEBRIEFING WITH RESPECT TO THE EVALUATION OF ITS PROPOSAL ON
FEBRUARY 1, 1983 (ALTHOUGH DOE ADVISES THAT NO INFORMATION REGARDING THE
OTHER PROPOSALS WAS GIVEN BECAUSE OF THE ON-GOING COMPETITION). BY
LETTER OF MARCH 4, DOE DENIED MUCH OF THE REQUESTED MATERIAL ON VARIOUS
GROUNDS, AND BY LETTER OF MARCH 31, DMC APPEALED THE DENIAL TO DOE'S
OFFICE OF HEARINGS AND APPEALS.
DMC'S PROTEST AS IT RELATES TO THE CONTENTS OF THE RFP IS UNTIMELY
UNDER SECTION 21.2(B)(1) OF OUR BID PROTEST PROCEDURES, WHICH REQUIRES
THAT PROTESTS BASED UPON ALLEGED IMPROPRIETIES IN AN RFP THAT ARE
APPARENT PRIOR TO THE CLOSING DATE FOR RECEIPT OF INITIAL PROPOSALS BE
FILED BEFORE THAT DATE. SEE ARMIDIR, LTD., B-205890, JULY 27, 1982,
82-2 CPD 83.
THE PROTEST AGAINST DOE'S EXCLUSION OF DMC FROM THE COMPETITIVE RANGE
ALSO IS UNTIMELY. SECTION 21.2(B)(2) OF OUR PROCEDURES REQUIRES THAT
PROTESTS BASED ON GROUNDS OTHER THAN IMPROPRIETIES APPARENT FROM THE
SOLICITATION BE FILED NOT LATER THAN 10 WORKING DAYS AFTER THE BASIS FOR
PROTEST IS KNOWN OR SHOULD HAVE BEEN KNOWN, WHICHEVER IS EARLIER. CRA,
INC., B-209779, DECEMBER 9, 1982, 82-2 CPD 519. THUS, ONCE DMC FOUND
OUT AT THE FEBRUARY 1 DEBRIEFING THE SPECIFIC REASONS FOR THE REJECTION
OF ITS PROPOSAL, IT WAS REQUIRED TO PROTEST WITHIN 10 WORKING DAYS OF
THE DEBRIEFING. CONTROL DATA CORPORATION, B-197946, JUNE 17, 1980, 80-1
CPD 423. DMC WAITED 2 MONTHS AFTER ITS DEBRIEFING BEFORE IT FILED ITS
PROTEST WITH OUR OFFICE, AND THE PROTEST THEREFORE IS UNTIMELY.
FURTHER, THE FACT THAT DMC MAY HAVE BEEN WAITING FOR A RESPONSE TO
ITS FOIA REQUEST IS IRRELEVANT, SINCE THE FIRM CLEARLY KNEW AT THE TIME
OF THE DEBRIEFING DOE'S REASONS FOR EXCLUDING THE PROPOSAL FROM THE
COMPETITIVE RANGE. SEE ADVANCED MARINE ENTERPRISES, INC., B-196252.2,
FEBRUARY 7, 1980, 80-1 CPD 106. IN ANY EVENT, IT APPEARS THAT THE APRIL
5 PROTEST WAS FILED MORE THAN 10 WORKING DAYS AFTER DMC'S RECEIPT OF
DOE'S MARCH 4 DENIAL OF MUCH OF THE REQUESTED MATERIAL.
WITH RESPECT TO DMC'S ALLEGED DIFFICULTIES IN OBTAINING FROM DOE ALL
OF THE INFORMATION REQUESTED, WE POINT OUT THAT OUR OFFICE HAS NO
AUTHORITY UNDER THE FOIA TO DETERMINE WHEN OR WHAT INFORMATION MUST BE
DISCLOSED BY OTHER AGENCIES. WESTEC SERVICES, INC., B-204871, MARCH 19,
1982, 82-1 CPD 257.
THE PROTEST IS DISMISSED.
B-210416, APR 5, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE BID FAILED TO INCLUDE DESCRIPTIVE DATA ON OFFERED "OR
EQUAL" ITEM (AND DATA HAD NOT PREVIOUSLY BEEN SUBMITTED AND WAS NOT
REASONABLY AVAILABLE TO CONTRACTING ACTIVITY), BID WAS PROPERLY
DETERMINED TO BE NONRESPONSIVE. FAILURE MAY NOT BE WAIVED AS MINOR
INFORMALITY/IRREGULARITY AND DATA MAY NOT BE SUBMITTED AFTER BID OPENING
IN ORDER TO MAKE NONRESPONSIVE BID RESPONSIVE WHERE DATA WAS NOT
COMMERCIALLY AVAILABLE PRIOR TO BID OPENING.
2. IMPORTANCE OF MAINTAINING INTEGRITY OF COMPETITIVE BIDDING SYSTEM
OUTWEIGHS POSSIBILITY THAT GOVERNMENT MIGHT REALIZE MONETARY SAVINGS IF
MATERIAL DEFICIENCY IN BID IS CORRECTED OR WAIVED.
VISTA SCIENTIFIC CORPORATION:
VISTA SCIENTIFIC CORPORATION (VISTA) PROTESTS THE REJECTION OF ITS
LOW BID UNDER NEWARK AIR FORCE BASE INVITATION FOR BIDS NO.
F33659-83-BA002. THE BID WAS REJECTED AS NONRESPONSIVE BECAUSE VISTA
FAILED TO SUBMIT PRIOR TO BID OPENING DESCRIPTIVE DATA ON THE "OR EQUAL"
ITEM (AN ITEM MANUFACTURED BY VISTA) IT WAS OFFERING TO SUPPLY.
WE DENY THE PROTEST.
BIDS WERE REQUESTED TO BE SUBMITTED ON A "THUNDER MODEL 7000 OR
EQUAL" RELATIVE HUMIDITY GENERATION AND TEMPERATURE CALIBRATION SYSTEM.
THE SALIENT CHARACTERISTICS WITH WHICH AN "OR EQUAL" SYSTEM WAS TO
COMPLY WERE SET FORTH IN THE INVITATION. THE SOLICITATION INCLUDED THE
FOLLOWING PROVISION REGARDING THE SUBMISSION OF AN "OR EQUAL" BID.
"L33 BRAND NAME OR EQUAL (1973 APR) DAR 7-2003.10
* * * * *
"(C)(1) IF THE BIDDER PROPOSES TO FURNISH AN
'EQUAL' PRODUCT, THE BRAND NAME, IF ANY, OF THE
PRODUCT TO BE FURNISHED SHALL BE INSERTED IN THE
SPACE PROVIDED IN THE INVITATION FOR BIDS, OR
SUCH PRODUCTS SHALL BE OTHERWISE CLEARLY IDENTIFIED
IN THE BID. THE EVALUATION OF BIDS AND THE
DETERMINATION AS TO EQUALITY OF THE PRODUCT OFFERED
SHALL BE THE RESPONSIBILITY OF THE GOVERNMENT AND
WILL BE BASED ON INFORMATION FURNISHED BY THE
BIDDER OR IDENTIFIED IN HIS BID, AS WELL AS OTHER
INFORMATION REASONABLY AVAILABLE TO THE PURCHASING
ACTIVITY. CAUTION TO BIDDERS. THE PURCHASING
ACTIVITY IS NOT RESPONSIBLE FOR LOCATING OR SECURING
ANY INFORMATION WHICH IS NOT IDENTIFIED IN THE BID
AND REASONABLY AVAILABLE TO THE PURCHASING
ACTIVITY. ACCORDINGLY, TO INSURE THAT SUFFICIENT
INFORMATION IS AVAILABLE, THE BIDDER MUST FURNISH
AS A PART OF HIS BID ALL DESCRIPTIVE MATERIAL (SUCH
AS CUTS, ILLUSTRATIONS, DRAWINGS, OR OTHER INFORMATION)
NECESSARY FOR THE PURCHASING ACTIVITY TO (I) DETERMINE
WHETHER THE PRODUCT OFFERED MEETS THE SALIENT
CHARACTERISTICS REQUIREMENTS OF THE INVITATION
FOR BIDS AND (II) ESTABLISH EXACTLY WHAT THE
BIDDER PROPOSES TO FURNISH AND WHAT THE GOVERNMENT
WOULD BE BINDING ITSELF TO PURCHASE BY MAKING AN
AWARD. THE INFORMATION FURNISHED MAY INCLUDE SPECIFIC
REFERENCES TO INFORMATION PREVIOUSLY FURNISHED OR
TO INFORMATION OTHERWISE AVAILABLE TO THE PURCHASING
ACTIVITY."
VISTA SUBMITTED NO DESCRIPTIVE DATA WITH ITS BID. AFTER BID OPENING,
VISTA SUBMITTED THE DATA.
IT IS VISTA'S POSITION THAT THE PROVISIONS OF PARAGRAPH L33 ARE
CAUTIONARY ONLY AND DO NOT REQUIRE AUTOMATIC DISQUALIFICATION OF A
BIDDER WHO DOES NOT PROVIDE THE DATA AT BID OPENING. VISTA BELIEVES
THAT THE PROVISIONS MERELY MAKE IT CLEAR THAT THE DESCRIPTIVE DATA MUST
BE MADE REASONABLY AVAILABLE TO THE CONTRACTING ACTIVITY. VISTA MADE
THE DATA REASONABLY AVAILABLE TO THE ACTIVITY BY PROVIDING IT PRIOR TO
AWARD AND, THEREFORE, THE ACTIVITY WAS IN THE SAME POSITION TO EVALUATE
THE VISTA SYSTEM AS IF VISTA HAD SUBMITTED THE DATA WITH ITS BID.
FURTHER, VISTA VIEWS THE OBLIGATION OF THE ACTIVITY AS BEING TO ACT IN
THE BEST INTEREST OF THE GOVERNMENT. SINCE THE VISTA BID PRICE IS
SUBSTANTIALLY LOWER THAN THE PRICE OF THE ONLY OTHER BIDDER (THE
MANUFACTURER OF THE BRAND NAME SYSTEM), VISTA BELIEVES THAT - EVEN
INTERPRETING PARAGRAPH L33 AS THE ACTIVITY DOES - VISTA'S FAILURE TO
PROVIDE THE DATA AT BID OPENING WAS MERELY A MINOR INFORMALITY/
IRREGULARITY WHICH MAY BE WAIVED UNDER INVITATION PARAGRAPH L10 (AWARD
OF CONTRACT). FINALLY, VISTA STATES THAT ITS SYSTEM DOES MEET THE
SALIENT CHARACTERISTICS SET FORTH IN THE INVITATION AND THAT IT IS
TECHNICALLY QUALIFIED TO SUPPLY THE SYSTEM BEING PURCHASED.
WE HAVE CONSISTENTLY HELD THAT WHERE DESCRIPTIVE DATA IS USED FOR BID
EVALUATION AND FOR THE DETERMINATION OF WHETHER AN "OR EQUAL" ITEM
CONFORMS WITH THE SPECIFICATIONS, SUBMISSION OF THAT DATA IS A MATTER OF
RESPONSIVENESS. IN SUCH CIRCUMSTANCES, A BIDDER'S FAILURE TO PROVIDE
PRIOR TO BID OPENING SUCH DATA AS IS NECESSARY TO DEMONSTRATE COMPLIANCE
WITH THE SPECIFICATIONS REQUIRES REJECTION OF THE BID, FOR A BIDDER MAY
NOT EXPLAIN THE MEANING OF THE BID OR HIS INTENTION TO COMPLY WITH
SPECIFICATIONS AFTER BIDS HAVE BEEN OPENED. TO ALLOW A BIDDER TO SUBMIT
ADDITIONAL DATA AFTER BID OPENING TO MAKE RESPONSIVE A BID WHICH WAS
NONRESPONSIVE FOR INADEQUATE OR NONCONFORMING DESCRIPTIVE DATA WOULD BE
TANTAMOUNT TO PERMITTING THE IMPROPER SUBMISSION OF A NEW BID.
INTERNATIONAL MEDICAL INDUSTRIES, INC., B-196432.5, JANUARY 19, 1981,
81-1 CPD 28. THUS, THE FAILURE TO PROVIDE PROPER DESCRIPTIVE DATA COULD
NOT BE WAIVED AS A MINOR INFORMALITY/IRREGULARITY.
FURTHER, THE DETERMINATION OF WHETHER AN "OR EQUAL" ITEM IS
RESPONSIVE TO THE SALIENT CHARACTERISTICS REQUIREMENTS IS DEPENDENT ON
THE COMPLETENESS AND SUFFICIENCY OF THE DESCRIPTIVE DATA SUBMITTED WITH
THE BID, PREVIOUSLY SUBMITTED DATA, OR DATA OTHERWISE REASONABLY
AVAILABLE TO THE CONTRACTING ACTIVITY. IT IS NOT ENOUGH THAT THE BIDDER
BELIEVES ITS PRODUCT TO BE EQUAL; THE GOVERNMENT MUST BE ABLE TO
DETERMINE ITS EQUALITY. E.C.CAMPBELL, INC., B-201025.2, JULY 8, 1981,
81-2 CPD 19.
VISTA CONTENDS THAT WHILE IT DID NOT SUBMIT THE DATA PRIOR TO BID
OPENING AND HAD NOT SUBMITTED IT PREVIOUSLY, THE DATA WAS REASONABLY
AVAILABLE TO THE CONTRACTING ACTIVITY SINCE IT WAS SUBMITTED TO THE
ACTIVITY BY VISTA PRIOR TO CONTRACT AWARD. WE HAVE HELD THAT FOR
DESCRIPTIVE DATA SUBMITTED AFTER BID OPENING TO BE PROPERLY CONSIDERED,
IT MUST BE COMMERCIALLY AVAILABLE PRIOR TO THE DATE OF THE BID OPENING.
DATA-CHRON, INC., B-196801, JULY 29, 1980, 80-2 CPD 78. BUT THE
ACTIVITY STATES THAT THE VISTA DATA WAS NOT REASONABLY AVAILABLE TO IT,
AND VISTA DOES NOT CONTEND THAT THIS DATA WAS COMMERCIALLY AVAILABLE.
THUS, WE AGREE WITH THE DETERMINATION OF THE ACTIVITY THAT THE VISTA BID
WAS NONRESPONSIVE FOR ITS FAILURE TO PROVIDE THE DATA AT BID OPENING.
FINALLY, AS REGARDS THE CONTENTION THAT AN AWARD TO VISTA WOULD HAVE
BEEN IN THE BEST INTEREST OF THE GOVERNMENT BECAUSE ITS PRICE WAS
SUBSTANTIALLY LOWER THAN THE PRICE OF THE OTHER BIDDER, THE IMPORTANCE
OF MAINTAINING THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM OUTWEIGHS
THE POSSIBILITY THAT THE GOVERNMENT MIGHT REALIZE A MONETARY SAVINGS IN
A PARTICULAR PROCUREMENT IF A MATERIAL DEFICIENCY IS CORRECTED OR
WAIVED. MARINO CONSTRUCTION COMPANY, INC., B-204970, FEBRUARY 25, 1982,
82-1 CPD 167.
ACCORDINGLY, THE PROTEST IS DENIED.
B-210415, OCT 11, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROPOSAL SUBMITTED BY ADP SCHEDULE CONTRACTOR
IN RESPONSE TO A COMMERCE BUSINESS
DAILY ANNOUNCEMENT OF INTENT TO PLACE AN
ORDER UNDER ANOTHER ADP SCHEDULE CONTRACT
NEED NOT BE ACCEPTED DESPITE ITS LOWER PRICE
AND APPARENT RESPONSIVENESS WHERE THE
PROCURING AGENCY HAD A REASONABLE BASIS FOR
BELIEVING THAT THE PROPOSED EQUIPMENT WOULD
NOT PERFORM AN ESSENTIAL OPERATION BASED
UPON THE AGENCY'S CONTEMPORANEOUS EXPERIENCE
WITH THE SAME MAKE AND MODEL OF EQUIPMENT AS
PROPOSED. MOREOVER, IN VIEW OF THIS CONTEMPORANEOUS
EXPERIENCE WITH THE PROTESTER'S
EQUIPMENT, THE AGENCY WAS NOT REQUIRED TO
GIVE THE PROTESTER A SEPARATE OPPORTUNITY TO
DEMONSTRATE THE OPERABILITY OF ITS EQUIPMENT.
M/A-COM ALANTHUS DATA, INC.:
M/A-COM ALANTHUS DATA, INC., FORMERLY ALANTHUS DATA COMMUNICATIONS
CORPORATION, PROTESTS THE U. S. GEOLOGICAL SURVEY'S ISSUANCE OF A
DELIVERY ORDER TO TERMINALS UNLIMITED UNDER THAT FIRM'S ADP SCHEDULE
CONTRACT NO. GS-00C-03205 TO PURCHASE SIX RENEX CONTROLLERS. ALANTHUS
CONTENDS THAT THE AWARD WAS IMPROPER BECAUSE IT WAS NOT GIVEN AN
OPPORTUNITY TO DEMONSTRATE THAT THE LOWER PRICED CONTROLLER OFFERED
UNDER ITS ADP SCHEDULE CONTRACT PERFORMED THE REQUIRED FUNCTIONS IN A
SATISFACTORY MANNER. WE FIND THAT ALANTHUS' PROTEST IS WITHOUT MERIT.
IN EARLY 1982, PRIOR TO THE INSTANT PROCUREMENT, THE GEOLOGICAL
SURVEY PURCHASED AN ALANTHUS MODEL C80 TERMINAL CONTROLLER/CONCENTRATOR
FOR USE AT THE DEPARTMENT OF INTERIOR'S WASHINGTON COMPUTER CENTER. THE
GEOLOGICAL SURVEY REPORTS THAT AFTER 6 MONTHS OF EFFORT ALANTHUS'
TECHNICAL REPRESENTATIVES FINALLY SUCCEEDED IN MAKING THE ALANTHUS
CONTROLLER OPERATE BY INSTALLING A NEW LOGIC BOARD BUT THAT THROUGHOUT
THE PERIOD IN QUESTION NEITHER ALANTHUS' TECHNICAL REPRESENTATIVES NOR
THE GOVERNMENT'S COMPUTER SPECIALISTS WERE ABLE TO MAKE THE AUTOMATIC
DISCONNECT FEATURE OF THE UNIT OPERATE. THE AGENCY REPORTS FURTHER THAT
IT BORROWED A RENEX CONTROLLER FROM THE BUREAU OF INDIAN AFFAIRS WHILE
THE PROBLEMS WITH THE ALANTHUS CONTROLLER WERE BEING CORRECTED AND THAT
THE RENEX UNIT OPERATED PROPERLY FROM THE BEGINNING.
CONSEQUENTLY, WHEN THE GEOLOGICAL SURVEY IDENTIFIED A NEED FOR SIX
ADDITIONAL CONTROLLERS IN OCTOBER OF 1982, IT DECIDED TO ORDER THE RENEX
UNIT AND, IN ACCORDANCE WITH FEDERAL PROCUREMENT REGULATIONS (FPR) SEC.
1-4.1109-6(F)(1) (1964 ED., AMEND. 211) PUBLISHED A SYNOPSIS OF THIS
INTENT IN THE NOVEMBER 12 COMMERCE BUSINESS DAILY.
ALANTHUS RESPONDED BY LETTER OF NOVEMBER 23, OFFERING TO SUPPLY ITS
MODEL C80 TERMINAL CONTROLLER/CONVERTER FOR $8,047.50 EACH. ALANTHUS
STATED THAT "WITH REGARD TO THE SPECIAL DISCONNECT FEATURE, THE C80 HAS
AN EASY TO USE, PROGRAMMABLE FEATURE" AND OFFERED TO DEMONSTRATE THE
FEATURE IF DESIRED. THE AGENCY DID NOT TAKE UP ALANTHUS' OFFER FOR A
DEMONSTRATION, BUT DURING DECEMBER THE AGENCY'S COMPUTER SPECIALISTS
CONTACTED ALANTHUS BY TELEPHONE AND RECEIVED DETAILED INSTRUCTION ON THE
OPERATION OF THE AUTOMATIC DISCONNECT FEATURE. THEY WERE, HOWEVER,
UNABLE TO MAKE THIS FEATURE OPERATE ON THE EXISTING ALANTHUS CONTROLLER.
ON JANUARY 3, 1983, GEOLOGICAL SURVEY'S COMPUTER SPECIALISTS REPORTED
TO THE CONTRACTING OFFICER THAT THE ALANTHUS CONTROLLER WAS
UNSATISFACTORY BECAUSE THEY HAD BEEN UNABLE TO GET THE AUTOMATIC
DISCONNECT FEATURE ON THE EXISTING UNIT TO WORK. THEY FURTHER REPORTED
THAT THIS FAILURE COULD CAUSE SEVERE SECURITY PROBLEMS SINCE IT
PERMITTED A SUBSEQUENT USER OF THE COMPUTER TO ACCESS THE PRIOR USER'S
DATA. ON THAT SAME DATE, THE AGENCY ISSUED A DELIVERY ORDER TO
TERMINALS UNLIMITED AGAINST ADP SCHEDULE CONTRACT NO. GS-00C-03205 FOR
SIX RENEX CONTROLLERS, AT $8,484 EACH, INCLUDING THE SPECIAL DISCONNECT
FEATURE.
ALANTHUS CONTENDS THAT ITS OFFER TO PROVIDE A CONTROLLER SHOULD NOT
HAVE BEEN REJECTED WITHOUT GIVING IT AN OPPORTUNITY TO DEMONSTRATE ITS
SPECIAL DISCONNECT FEATURE. ALANTHUS POINTS OUT THAT BOTH IN ITS WRITTEN
OFFER AND IN ITS SUBSEQUENT TELEPHONE CONVERSATIONS IT OFFERED TO
DEMONSTRATE THE OPERATION OF THIS FEATURE AND STATES THAT 2 DAYS AFTER
AWARD ITS REPRESENTATIVES DID IN FACT SUCCESSFULLY OPERATE THE AUTOMATIC
DISCONNECT FEATURE ON THE EXISTING ALANTHUS CONTROLLER. ALANTHUS
THEREFORE REQUESTS A REOPENING OF THE COMPETITION; THE APPOINTMENT OF A
QUALIFIED TECHNICAL PANEL TO CONDUCT THE EVALUATION; AND AN OPPORTUNITY
TO DEMONSTRATE THE SPECIAL DISCONNECT FEATURE UNDER THESE CONDITIONS.
THE GEOLOGICAL SURVEY DISAGREES, ASSERTING THAT DURING THE COURSE OF
THE TWO PROCUREMENTS BOTH BRANDS OF EQUIPMENT, INCLUDING THE ESSENTIAL
DISCONNECT FEATURE, WERE THOROUGHLY TESTED AND EVALUATED, THROUGH
POST-AWARD TESTING IN THE PRIOR CASE AND PRE-AWARD EVALUATION IN THE
INSTANT CASE. CONSEQUENTLY, THE AGENCY BELIEVES THAT THE PROTESTER WAS
GIVEN AMPLE OPPORTUNITY TO DEMONSTRATE THE OPERATION OF ITS CONTROLLER.
FINALLY, THE AGENCY ASSERTS THAT IT IS NEITHER REASONABLE NOR IN THE
GOVERNMENT'S BEST INTERESTS TO RE-PROCURE EQUIPMENT THAT HAS PROVEN TO
BE UNSATISFACTORY.
UNDER THE GOVERNING REGULATIONS, PROCURING AGENCIES ARE PERMITTED TO
PLACE AN ORDER AGAINST ADP SCHEDULE CONTRACTS WHEN CERTAIN CONDITIONS
ARE SATISFIED. ONE CONDITION IS THAT WHEN AN OFFER IS RECEIVED FROM
ANOTHER SOURCE IN RESPONSE TO A SYNOPSIS IN THE COMMERCE BUSINESS DAILY,
THE PROCUREMENT FILE MUST BE DOCUMENTED TO SHOW THAT THE PROPOSED
SCHEDULE ORDER IS THE LOWEST OVERALL COST ALTERNATIVE TO THE AGENCY,
PRICE AND OTHER FACTORS CONSIDERED. FPR SEC. 1-4.1109-6(B)(4). JUST AS
IN THE CASE FOR NON-SCHEDULE OFFERORS, WHEN ANOTHER SCHEDULE CONTRACTOR
OFFERS A COMPARABLE ITEM AT A LOWER PRICE, THE AGENCY MUST APPROPRIATELY
JUSTIFY ITS DETERMINATION TO PROCURE FROM THE HIGHER PRICED SCHEDULE
SUPPLIER. FPR SEC. 1-4.1109-6(H). OUR OFFICE WILL NOT TAKE OBJECTION
TO SUCH A JUSTIFICATION FOR PURCHASE AT OTHER THAN THE LOWEST PRICE
UNLESS IT IS SHOWN TO BE UNREASONABLE. SEE QUEST ELECTRONICS, B-193541,
MARCH 27, 1979, 79-1 CPD 205.
HERE, THE EVALUATION WAS BASED BOTH ON ALANTHUS' WRITTEN OFFER AND
THE AGENCY'S CONTEMPORANEOUS EXPERIENCE WITH THE SAME MODEL OF
CONTROLLER ALANTHUS OFFERED. GIVEN THIS EXPERIENCE, WHICH SHOWED THAT
DESPITE REPEATED EFFORTS OVER MANY MONTHS THE AGENCY'S EXPERIENCED
COMPUTER SPECIALISTS COULD NOT GET A CRITICAL FEATURE OF THE CONTROLLER
TO OPERATE, WE THINK IT WAS REASONABLE FOR THE AGENCY TO CONCLUDE THAT
THE ALANTHUS CONTROLLER DID NOT SATISFY ITS MINIMUM REQUIREMENTS. IN
THESE CIRCUMSTANCES, THE JANUARY 3 MEMORANDUM OF EVALUATION, EXPLAINING
THAT ALANTHUS HAD FAILED TO DEMONSTRATE THE SPECIAL DISCONNECT FEATURE,
CONSTITUTES THE REQUIRED JUSTIFICATION FOR AWARD TO OTHER THAN THE
LOWEST PRICED OFFEROR.
FURTHER, GIVEN GEOLOGICAL SURVEY'S CONTEMPORANEOUS EXPERIENCE WITH
ALANTHUS' RECENTLY INSTALLED CONTROLLER AND ITS TELEPHONE INQUIRIES
SEEKING DIRECTIONS FROM ALANTHUS FOR OPERATING THE DISCONNECT FEATURE AT
THE VERY TIME IT WAS EVALUATING ALANTHUS' NEW OFFER, WE DO NOT BELIEVE
THAT THE AGENCY WAS REQUIRED TO SEEK A FURTHER DEMONSTRATION OF THE
ALANTHUS CONTROLLER. IN THIS REGARD, ALANTHUS' PERSONNEL PREVIOUSLY HAD
BEEN ON THE SITE WORKING ON THE CONTROLLER WITHOUT, APPARENTLY, EITHER
ENSURING THAT THE SPECIAL DISCONNECT FEATURE WAS OPERABLE OR ADEQUATELY
INSTRUCTING THE AGENCY PERSONNEL ON ITS OPERATION. CONSEQUENTLY, WE
BELIEVE THAT ALANTHUS WAS GIVEN AN ADEQUATE OPPORTUNITY TO SHOW THAT THE
CONTROLLER IT OFFERED SATISFIED THE AGENCY'S MINIMUM TECHNICAL NEEDS.
FINALLY, EVEN IF, AS ALANTHUS CONTENDS, ITS REPRESENTATIVES WERE ABLE
TO OPERATE THE SPECIAL DISCONNECT FEATURE ON THE GEOLOGICAL SURVEY'S
EXISTING ALANTHUS CONTROLLER WHEN THEY GAINED ACCESS TO IT SHORTLY AFTER
THE JANUARY 3 AWARD DATE, THAT FACT ALONE DOES NOT INDICATE ANY
IMPROPRIETY. THE JUDGMENT EXPRESSED BY THE GOVERNMENT'S EVALUATORS WAS
NECESSARILY BASED ON THE AGENCY'S EXPERIENCE WITH THE ALANTHUS
CONTROLLER PRIOR TO AWARD.
THE PROTEST IS DENIED.
B-210414, MAR 15, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
POST-AWARD PROTEST BY POTENTIAL SUPPLIER OF ROOFING MATERIALS
ALLEGING THAT SPECIFICATIONS REQUIRING GLASS FIBER ROOFING INSULATION
ARE UNDULY RESTRICTIVE IS DISMISSED AS UNTIMELY. SINCE REQUIREMENT WAS
CLEARLY STATED IN GOVERNMENT'S SOLICITATION, PROTEST SHOULD HAVE BEEN
FILED BEFORE BID OPENING.
MANVILLE BUILDING MATERIALS CORPORATION:
MANVILLE BUILDING MATERIALS CORPORATION, A SUPPLIER OF ROOFING
MATERIAL, PROTESTS THE SPECIFICATIONS UNDER A PRIME CONTRACT FOR ROOF
CONSTRUCTION, NO. F05611-82-C-0126, BETWEEN C.P.CONSTRUCTION, INC. AND
THE DEPARTMENT OF THE AIR FORCE, UNITED STATES AIR FORCE ACADEMY,
COLORADO. ACCORDING TO MANVILLE, GOVERNMENT OFFICIALS HAVE REFUSED TO
PERMIT THE PRIME CONTRACTOR TO USE AS AN "ALTERNATIVE" ROOFING SYSTEM TO
THAT SPECIFIED A LESS EXPENSIVE BUT COMPARABLE ROOFING SYSTEM PROPOSED
BY MANVILLE BASED ON ITS OWN SPECIFICATIONS.
THE AIR FORCE SOLICITED BIDS FOR THIS ROOF REPAIR PROJECT UNDER
INVITATION FOR BIDS NO. FO5611-82-B-0108, WHICH WAS ISSUED ON JULY 22,
1982 AND IN RESPONSE TO WHICH BIDS WERE SUBMITTED ON AUGUST 23, 1982.
WE HAVE BEEN INFORMALLY ADVISED BY THE AIR FORCE THAT THE CONTRACT WAS
AWARDED TO C.P.CONSTRUCTION ON AUGUST 25. THE SOLICITATION
SPECIFICATIONS REQUIRED THE USE OF FIBROUS GLASS INSULATION, WHICH
MANVILLE DOES NOT MANUFACTURE.
ACCORDING TO MANVILLE, AT ITS URGING C.P.CONSTRUCTION, AFTER AWARD,
OFFERED TO PROVIDE THE GOVERNMENT WITH AN "ALTERNATE" ROOFING SYSTEM TO
THAT SPECIFIED USING PERLITE INSULATION, WHICH MANVILLE MANUFACTURES, AT
A LOWER PRICE. THIS REQUEST WAS DENIED ON NOVEMBER 8. WHEN MANVILLE
COULD NOT PERSUADE THE AIR FORCE TO CHANGE ITS POSITION THROUGH FURTHER
DISCUSSIONS, MANVILLE FILED A PROTEST WITH OUR OFFICE ON JANUARY 7,
1983.
MANVILLE BELIEVES THAT THE GOVERNMENT'S INSISTENCE ON GLASS FIBER
ROOFING INSULATION IS UNDULY RESTRICTIVE. ACCORDING TO MANVILLE, SUCH
MATERIAL IS AVAILABLE AT EXCESSIVE COST ONLY FROM ONE MANUFACTURER AND
THE REQUIREMENT FOR IT EXCEEDS THE MINIMUM NEEDS OF THE AGENCY. (THE
GOVERNMENT'S SPECIFICATIONS IN QUESTION ARE APPARENTLY BASED ON AIR
FORCE MANUAL 91-36 WHICH PRESCRIBES MATERIALS FOR PROJECTS OF THIS
TYPE.) FOR THE REASONS DISCUSSED BELOW, WE FIND THE PROTEST TO BE
UNTIMELY.
IT IS UNDISPUTED THAT THE PRIME CONTRACT SOLICITATION CALLED FOR THE
USE OF GLASS FIBER ROOFING INSULATION. UNDER OUR BID PROTEST
PROCEDURES, PROTESTS CONCERNING DEFECTS APPARENT IN A PRIME CONTRACT
SOLICITATION MUST BE FILED BEFORE BID OPENING OR THE CLOSING DATE FOR
RECEIPT OF PROPOSALS, AS APPROPRIATE. 4 C.F.R. SEC. 21.2(B)(1) (1982);
TRULAND CORPORATION; COMPUGUARD CORPORATION, B-189505, SEPTEMBER 26,
1977, 77-2 CPD 226. IN THIS RESPECT, THE GOVERNMENT PUBLISHED THE
REQUIREMENT IN THE COMMERCE BUSINESS DAILY; WE HAVE HELD THAT SUCH
PUBLICATION CONSTITUTES CONSTRUCTIVE NOTICE OF A SYNOPSIZED SOLICITATION
AND ITS CONTENTS. LUTZ SUPERDYNE, INC., B-201553, FEBRUARY 20, 1981,
81-1 CPD 122.
THE RECORD IS UNCLEAR WHETHER MANVILLE KNEW OF THE PRESENT
SOLICITATION AND ITS REQUIREMENTS FOR FIBROUS GLASS INSULATION PRIOR TO
BID OPENING IN AUGUST 1982. HOWEVER, EVEN IF MANVILLE WAS UNAWARE OF
THE ACTUAL TERMS OF THE SOLICITATION, ITS PROTEST IS NEVERTHELESS
UNTIMELY BECAUSE, AS STATED ABOVE, WE HAVE HELD THAT PUBLICATION IN THE
COMMERCE BUSINESS DAILY CONSTITUTES CONSTRUCTIVE NOTICE OF THE
SOLICITATION CONTENTS TO ALL PARTIES. WE HAVE RECOGNIZED THAT THIS RULE
ATTRIBUTING CONSTRUCTIVE KNOWLEDGE OF A SOLICITATION RESTRICTION TO A
SUBCONTRATOR MAY BE SOMEWHAT HARSH WHEN APPLIED TO A PROTESTER WHO
ACTUALLY MAY HAVE BEEN UNAWARE OF THE SUBCONTRACTING RESTRICTION. WE
BELIEVE, HOWEVER, THAT THE RULE IS NECESSARY TO MINIMIZE THE POTENTIAL
FOR ABUSE AT LEAST IN THOSE INSTANCES WHERE IT OTHERWISE WOULD BE
POSSIBLE FOR A SUBCONTRACTOR TO FILE A PROTEST THAT WOULD BE UNTIMELY IF
IT WERE FILED BY THE PRIME CONTRACTOR. LUMASIDE, INC., B-205220,
B-205220.2, DECEMBER 16, 1981, 81-2 CPD 481. WE BELIEVE THE SAME
PRINCIPLE IS APPLICABLE TO POTENTIAL MATERIAL SUPPLIERS OF PRIME
CONTRACTORS. SINCE MANVILLE DID NOT PROTEST PRIOR TO BID OPENING, ITS
PROTEST IS UNTIMELY.
MANVILLE ARGUES THAT EVEN IF ITS PROTEST SHOULD BE CONSIDERED
UNTIMELY IT SHOULD BE CONSIDERED ON THE MERITS UNDER THE EXCEPTIONS TO
THE TIMELINESS REQUIREMENTS SET FORTH IN OUR BID PROTEST PROCEDURES,
SEC. 21.2(C). THAT RULE PROVIDES THAT AN UNTIMELY PROTEST MAY BE
CONSIDERED IF IT RAISES A QUESTION OF SIGNIFICANCE TO PROCUREMENT
PRACTICES OR PROCEDURES, OR FOR GOOD CAUSE SHOWN.
WE DO NOT CONSIDER THAT MANVILLE'S PROTEST PRESENTS A SIGNIFICANT
ISSUE. THE SIGNIFICANT ISSUE EXCEPTION TO OUR TIMELINESS RULE IS
LIMITED TO ISSUES WHICH ARE OF WIDESPREAD INTEREST TO THE ENTIRE
PROCUREMENT COMMUNITY AND IS EXERCISED SPARINGLY SO THAT TIMELINESS
STANDARDS DO NOT BECOME MEANINGLESS. IT IS NOT CLEAR TO US WHY
MANVILLE'S CONCERNS SHOULD BE VIEWED AS OF SUCH WIDESPREAD INTEREST. IN
ANY EVENT, MANVILLE ACKNOWLEDGES THAT FUTURE INDIVIDUAL ROOFING
REQUIREMENTS FOR AIR FORCE INSTALLATIONS WOULD CONTAIN THE SPECIFICATION
IN QUESTION. WE SEE NO REASON WHY MANVILLE CANNOT LEARN OF SUCH FUTURE
AIR FORCE PROJECTS THROUGH THE COMMERCE BUSINESS DAILY OR OTHERWISE AND
PROTEST THE SPECIFICATIONS IN A TIMELY FASHION AT THAT TIME. FURTHER,
DESPITE MANVILLE'S ASSERTION OF "EXCESSIVE COSTS" BEING INCURRED DUE TO
THE ALLEGEDLY RESTRICTIVE SPECIFICATIONS, THE SIGNIFICANCE OF AN ISSUE
FOR PURPOSES OF THIS EXCEPTION DOES NOT DEPEND UPON THE AMOUNT OF MONEY
INVOLVED. 52 COMP.GEN. 20, 23 (1973). WE THEREFORE DO NOT BELIEVE THAT
THIS PROTEST PRESENTS A SIGNIFICANT ISSUE FOR OUR CONSIDERATION.
FINALLY, ALTHOUGH WE WOULD CONSIDER AN UNTIMELY PROTEST FOR "GOOD
CAUSE SHOWN," THIS REFERS TO SOME COMPELLING REASON BEYOND THE
PROTESTER'S CONTROL WHICH PREVENTED IT FROM FILING A TIMELY PROTEST.
INTERNATIONAL COMPUTAPRINT CORP., B-186948, OCTOBER 28, 1976, 76-2 CPD
357. THE RECORD IN THIS CASE REVEALS NO SUCH REASON.
ACCORDINGLY, THIS PROTEST IS DISMISSED.
B-210413, JUN 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. AGENCY REASONABLY PERMITTED BID CORRECTION BECAUSE BIDDER'S
WORKSHEETS CLEARLY SHOW THAT BIDDER MADE MISTAKE IN TRANSPOSING $52,935
COST TO SUMMARY WORKSHEET AS $22,935, AND THAT $30,000 ERROR SHOULD BE
MULTIPLIED BY 1.15 CONTINGENCY FACTOR. UNCERTAINTY REGARDING WHETHER
BIDDER, WHICH ALSO REDUCED ERRONEOUS BID BY $6,329 PRIOR TO OPENING,
WOULD HAVE REDUCED CORRECT BID BY THAT SAME AMOUNT DOES NOT PROHIBIT
CORRECTION BECAUSE UNCERTAINTY IS SMALL AND UPPER RANGE OF UNCERTAINTY
(THAT IS, NO REDUCTION) STILL LEAVES BID SUBSTANTIALLY BELOW THE NEXT
LOW BID.
2. PROTEST AGAINST AWARDEE'S CAPACITY TO PERFORM THE CONTRACT IS A
PROTEST AGAINST AFFIRMATIVE DETERMINATION OF RESPONSIBILITY WHICH WE DO
NOT REVIEW EXCEPT IN CIRCUMSTANCES NOT PRESENT IN THIS CASE.
3. ABSENT A FINDING OF NONRESPONSIBILITY, A BELOW-COST BID DOES NOT
PROVIDE A REASON TO CHALLENGE AN AWARD.
DADSON CORPORATION:
DADSON CORPORATION (DADSON) PROTESTS THE AWARD OF A CONTRACT BY THE
DEPARTMENT OF THE ARMY (ARMY), MATERIAL DEVELOPMENT AND READINESS
COMMAND, WATERVLIET ARSENAL, NEW YORK, TO CUMBERLAND MACHINERY, INC.
(CUMBERLAND), UNDER INVITATION FOR BIDS (IFB) NO. DAAA22-82-B-9018, A
TWO-STEP, FORMALLY ADVERTISED PROCUREMENT FOR THREE GUN DRILLING
MACHINES. DADSON CONTENDS THAT: (1) CUMBERLAND SHOULD NOT HAVE BEEN
PERMITTED TO CORRECT A MISTAKE IN ITS BID; (2) CUMBERLAND LACKS THE
CAPACITY TO PERFORM THE CONTRACT; AND (3) CUMBERLAND'S BID IS TOO LOW.
WE DENY THE PROTEST IN PART AND DISMISS THE PROTEST IN PART.
CUMBERLAND SUBMITTED THE LOW BID AT $139,284 PER UNIT AND DADSON WAS
SECOND LOW AT $233,150. THE GOVERNMENT ESTIMATE WAS $242,750. DUE TO
THE DISCREPANCY BETWEEN CUMBERLAND'S BID, DADSON'S AND THE OTHER HIGHER
BIDS, THE ARMY ADVISED CUMBERLAND THAT IT MAY HAVE MADE A MISTAKE IN ITS
BID. CUMBERLAND RESPONDED THAT IT HAD MADE A MISTAKE IN TRANSPOSING
$52,935 "GOVT SPECIAL SPECS" LABOR COSTS TO ITS SUMMARY WORKSHEETS AS
$22,935 AND REQUESTED PERMISSION TO INCREASE ITS BID BY $34,500 -
$30,000 MULTIPLIED BY 1.15, A CONTINGENCY FACTOR, BECAUSE THE SUM OF THE
SUMMARY WORKSHEET FIGURES WAS MULTIPLIED BY 1.15. THE ARMY PERMITTED
CUMBERLAND TO CORRECT ITS BID TO $173,784 ($34,500 PLUS $139,284) AND
AWARDED CUMBERLAND THE CONTRACT.
A BID MAY BE CORRECTED, PROVIDED THAT BOTH AS CORRECTED AND
UNCORRECTED IT IS LOW AND THE EVIDENCE IS CLEAR AND CONVINCING AS TO THE
EXISTENCE OF A MISTAKE AND AS TO THE BID ACTUALLY INTENDED. DEFENSE
ACQUISITION REGULATION (DAR) SEC. 2-406.3(A)(2) (1976 ED.). ALTHOUGH OUR
OFFICE RETAINS THE RIGHT OF REVIEW, THE AUTHORITY TO CORRECT MISTAKES
ALLEGED AFTER BID OPENING, BUT PRIOR TO AWARD, IS VESTED IN THE
PROCURING AGENCY; MOREOVER, THE WEIGHT TO BE GIVEN THE EVIDENCE IN
SUPPORT OF AN ALLEGED MISTAKE IS A QUESTION OF FACT TO BE CONSIDERED BY
THE ADMINISTRATIVELY DESIGNATED EVALUATOR OF EVIDENCE, WHOSE DECISION
WILL NOT BE DISTURBED BY OUR OFFICE UNLESS THERE IS NO REASONABLE BASIS
FOR THE DECISION. SEE UNITED AMMUNITION CONTAINER, INC., B-198822,
AUGUST 8, 1980, 80-2 CPD 105.
WE HAVE CAREFULLY EXAMINED CUMBERLAND'S WORKSHEETS. THEY PROVIDE
CLEAR AND CONVINCING EVIDENCE THAT CUMBERLAND MADE A $30,000 TRANSPOSING
ERROR. THEY ALSO SUPPORT CUMBERLAND'S CLAIM THAT THE $30,000 SHOULD BE
MULTIPLIED, AS WERE THE OTHER FIGURES ON THE SUMMARY WORKSHEET, BY 1.15.
WE RECOGNIZE, AS DADSON POINTS OUT, THAT THE WORKSHEETS ARE NOT DATED;
HOWEVER, THIS IS NOT DETERMINATIVE BECAUSE THERE IS NO REQUIREMENT THAT
WORKSHEETS BE DATED. FORTEC CONSTRUCTORS, B-203627, FEBRUARY 16, 1982,
82-1 CPD 132.
WHILE THE WORKSHEETS DEMONSTRATE A $34,500 ERROR, CUMBERLAND MADE TWO
REDUCTIONS IN ITS BID WHICH ARE NOT EXPLAINED BY THE WORKSHEETS. THE
SUMMARY WORKSHEETS INDICATE A TOTAL ESTIMATED BID OF $145,613. NEXT TO
THE TOTAL ARE THE WORDS, "BID $144,874." CUMBERLAND ADVISES IT
ARBITRARILY REDUCED ITS $145,613 ESTIMATE FOR BIDDING PURPOSES. IN
ADDITION, CUMBERLAND INITIALLY SUBMITTED A BID OF $144,874, AND, PRIOR
TO BID OPENING, FURTHER REDUCED ITS BID BY $5,590 TO $139,284.
CUMBERLAND EXPLAINS THIS AS AN APPROXIMATE 5-PERCENT REDUCTION IN
MATERIAL COSTS. THE SUM OF THESE REDUCTIONS IS $6,329.
THE ARMY AND DADSON AGREE THAT THE FIRST REDUCTION OF $739 ($145,613
TO $144,874) CREATES AN UNCERTAINTY AS TO WHAT REDUCTION, IF ANY,
CUMBERLAND WOULD HAVE MADE IF IT HAD NOT MADE THE TRANSPOSING ERROR.
HOWEVER, THE ARMY DOES NOT CONSIDER THE SECOND REDUCTION TO BE UNCERTAIN
BECAUSE THE MATERIAL COSTS ARE IN A WORKSHEET COLUMN THAT IS SEPARATE
FROM THE LABOR COSTS COLUMN; THEREFORE, THE AMOUNT OF THE MATERIAL
COSTS REDUCTION WOULD HAVE BEEN THE SAME IF THE TRANSPOSING ERROR
REGARDING LABOR COSTS HAD NOT BEEN MADE. THE ARMY CONTENDS THAT THE
CORRECTION OF CUMBERLAND'S BID WAS PROPER BECAUSE THE UNCERTAINTY
REGARDING THE FIRST REDUCTION IS SMALL, THE SECOND IS EXPLAINABLE, AND
THE BID AS CORRECTED ($173,784) REMAINS SUBSTANTIALLY LOWER THAN
DADSON'S ($233,150) BID.
DADSON CONTENDS THAT BOTH REDUCTIONS CREATE AN UNCORRECTABLE
UNCERTAINTY AS TO WHAT REDUCTION WOULD HAVE BEEN MADE, BUT FOR THE ERROR
UNDER THE "CLEAR AND CONVINCING EVIDENCE" REQUIREMENT, AND THAT THE
CORRECTION ADVERSELY AFFECTS THE INTEGRITY OF THE COMPETITIVE BIDDING
SYSTEM.
CHRIS BERG, INC. V. UNITED STATES, 426 F.2D 314, 192 CT.CL. 176
(1970), INVOLVED A MISTAKE IN BID VERY SIMILAR TO THAT INVOLVED HERE.
THE PLAINTIFF CLAIMED TO HAVE OMITTED $41,121 IN COSTS FROM ITS BID.
THE WORKSHEETS SHOWED A COMPUTATION OF $618,128, WHICH THE BIDDER
REDUCED TO $616,000 FOR BIDDING PURPOSES. (THE NEXT LOWEST BID WAS
$732,800.) THIS $2,128 REDUCTION WAS APPARENTLY DUE TO THE BIDDER'S
CONCERN WITH THE POSSIBILITY OF BEING UNDERBID. THIS CREATED AN
UNCERTAINTY AS TO THE AMOUNT THAT THE PLAINTIFF WOULD HAVE BID IF IT HAD
NOT MADE THE MISTAKE. THE COURT NOTED THAT SUCH A BIDDER, HAD HE NOT
MADE AN ERROR, STILL WOULD BE MORE WORRIED ABOUT OTHER BIDDERS AND WOULD
TEND TO SHAVE HIS BID EVEN MORE. THUS, THE PROBABLE BID THAT WOULD HAVE
BEEN SUBMITTED WOULD BE OVER A WIDE RANGE OF POSSIBILITIES. THE
GOVERNMENT ARGUED, AS DADSON DOES IN THIS CASE, THAT SUCH AN UNCERTAINTY
ALWAYS PRECLUDES CORRECTION UNDER ARMED SERVICES PROCUREMENT REGULATION
SEC. 2-406.3(A)(2) (CURRENTLY DAR SEC. 2-406.3( A)(2) (1976 ED.)). THE
COURT DISAGREED: "THE TROUBLE WITH THIS VIEW IS THAT IT EFFECTIVELY
NULLIFIES THE REGULATION AND THEREFORE, OF NECESSITY, MUST MISCONSTRUE
IT." THE COURT DETERMINED THAT THE REDUCTION WAS DE MINIMUS AND, THUS,
THE SAME AS NO REDUCTION AT ALL. THE COURT CONTINUED:
"*** MOREOVER, WE THINK AN UNCERTAINTY WITHIN
A RELATIVELY NARROW RANGE IS NOT INCONSISTENT
WITH 'CLEAR AND CONVINCING EVIDENCE' OF WHAT
THE BID WOULD HAVE BEEN. PLAINTIFF PROPOSES
THAT THE 'ROUNDED OFF' FIGURE $616,000 BE
REFORMED BY ADDING THE 'ROUNDED OFF' FIGURE OF
$41,000, MAKING A REFORMED CONTRACT PRICE OF
$657,000, AND THIS SUGGESTION WE ADOPT AS IT
PUTS PLAINTIFF AT THE BOTTOM OF THE RANGE OF
UNCERTAINTY. ***"
OUR DECISIONS SIMILARLY INTERPRET DAR SEC. 2-406.3(A)(2) (1976 ED.).
WE REQUIRE THAT A BIDDER CLAIMING MISTAKE SUBMIT CLEAR AND CONVINCING
EVIDENCE THAT AN ERROR HAS BEEN MADE, THE MANNER IN WHICH IT HAS
OCCURRED, AND THE INTENDED BID PRICE. FORTEC CONSTRUCTORS, B-203190.2,
SEPTEMBER 29, 1981, 81-2 CPD 264; TELEDYNE MCCORMICK SELPH, B-182026,
MARCH 6, 1975, 75-1 CPD 136. HOWEVER, AS IN CHRIS BERG, INC. V. UNITED
STATES, SUPRA, WE HAVE ALSO FOUND, IN LIMITED CIRCUMSTANCES, THAT
CORRECTION IS PROPER EVEN WHEN THE INTENDED BID CANNOT BE DETERMINED
EXACTLY. WESTAM BUILDERS & ENGINEERS, INC., B-195207, JULY 14, 1980,
80-2 CPD 28; WESTERN STATES CONSTRUCTION COMPANY, INC., B-191209,
AUGUST 29, 1978, 78-2 CPD 149. AS WE STATED IN FORTEC CONSTRUCTORS,
SUPRA:
"IN JUDGING THE SUFFICIENCY OF THE
EVIDENCE IN THOSE SITUATIONS, WE CONSIDER THE
CIRCUMSTANCES OF EACH CASE SUCH AS THE CLOSENESS
OF THE CORRECTED BID AND THE NEXT LOW BID,
GEORGE C. MARTIN, INC., B-187638, JANUARY 19,
1977, 77-1 CPD 39, AND THE RANGE OF UNCERTAINTY
IN THE INTENDED BID, TREWEEK CONSTRUCTION,
B-183387, APRIL 15, 1975, 75-1 CPD 227. FOR
EXAMPLE, IN FORTEC CONSTRUCTORS, B-189949,
NOVEMBER 15, 1977, 77-2 CPD 372, AND IN WESTERN
STATES CONSTRUCTION COMPANY, INC., SUPRA, WE
RECOMMENDED CORRECTION WHERE THERE WAS CLEAR
AND CONVINCING EVIDENCE THAT CERTAIN DIRECT
COSTS WERE OMITTED BY MISTAKE, BUT WHERE THE
INTENDED BID WAS NOT EXACTLY ASCERTAINABLE DUE
TO DOUBT OVER THE AMOUNT OF ADDITIONAL MARKUP
THAT SHOULD BE ADDED. IN BOTH CASES THE WORKSHEET
PROVIDED EVIDENCE OF THE APPROXIMATE
AMOUNT OF MARKUP THAT SHOULD BE ADDED, BUT LEFT
A NARROW RANGE OF UNCERTAINTY AS TO THE EXACT
AMOUNT. IN BOTH CASES, USING THE UPPER LIMIT
OF THAT RANGE OF UNCERTAINTY STILL LEFT THE
CORRECTED BID SUBSTANTIALLY BELOW THE NEXT LOW
BID. ***"
CUMBERLAND HAS NOT DOCUMENTED THAT THE SECOND REDUCTION WAS DUE TO A
5-PERCENT REDUCTION IN MATERIAL COSTS. THE BASIS FOR THE SECOND
REDUCTION IS, THEREFORE, AS UNCERTAIN AS THE BASIS FOR THE FIRST
REDUCTION. HOWEVER, THE RANGE OF UNCERTAINTY IS NARROW BECAUSE THE
UPPER RANGE OF UNCERTAINTY, THAT IS, NO REDUCTION, WOULD STILL LEAVE
CUMBERLAND'S BID SUBSTANTIALLY BELOW THE NEXT LOW BID. THIS CASE IS,
THEREFORE, DISTINGUISHABLE FROM 48 COMP.GEN. 748 (1969) RELIED ON BY
DADSON, IN WHICH THE LOW BID WOULD HAVE BEEN INCREASED TO WITHIN $613 OF
THE NEXT LOW BID OF $272,464. SEE COLEMAN INDUSTRIAL CONSTRUCTION
COMPANY, B-207682, SEPTEMBER 8, 1982, 82-2 CPD 213. OUR DECISION IN 52
COMP.GEN. 706 (1973) IS SIMILARLY DISTINGUISHABLE. THE PRESENCE OF THIS
NARROW DEGREE OF UNCERTAINTY IS NOT INCONSISTENT WITH THE "CLEAR AND
CONVINCING EVIDENCE" REQUIREMENT. CHRIS BERG, INC. V. UNITED STATES,
SUPRA; FORTEC CONSTRUCTORS, B-189949, SUPRA. WE THEREFORE DO NOT FIND
THAT THE ARMY'S DECISION TO PERMIT THE CORRECTION LACKED A REASONABLE
BASIS.
DADSON ALSO QUESTIONS CUMBERLAND'S CAPACITY TO PERFORM THE CONTRACT,
A CHALLENGE TO THE CONTRACTING AGENCY'S AFFIRMATIVE DETERMINATION OF
CUMBERLAND'S RESPONSIBILITY. OUR OFFICE DOES NOT REVIEW AFFIRMATIVE
DETERMINATIONS OF RESPONSIBILITY UNLESS THERE IS A SHOWING OF FRAUD ON
THE PART OF THE GOVERNMENT OR AN ALLEGATION OF FAILURE TO APPLY
DEFINITIVE RESPONSIBILITY CRITERIA. DADSON DOES NOT ALLEGE EITHER
EXCEPTION HERE. SIMILARLY, THE QUESTION OF WHETHER CUMBERLAND'S BID IS
TOO LOW RELATES TO RESPONSIBILITY. ABSENT A DETERMINATION OF
NONRESPONSIBILITY, THE SUBMISSION OF A BELOW-COST BID IS NOT A VALID
BASIS UPON WHICH TO CHALLENGE AN AWARD. WARFIELD & SANFORD, INC.,
B-206929, APRIL 20, 1982, 82-1 CPD 365.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
B-210411.2, APR 3, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
A PRIVATE PERSON WHO DOES NOT REPRESENT
ANY ENTITY PARTICIPATING IN A QUESTIONED
PROCUREMENT, BUT RATHER REQUESTS RECONSIDERATION
OF A PROTEST AS "AN AGGRIEVED
TAXPAYER," IS NOT AN "INTERESTED PARTY"
UNDER GAO'S BID PROTEST PROCEDURES SINCE
HE DOES NOT HAVE A DIRECT ECONOMIC INTEREST
IN THE PROCUREMENT.
TURBINE ENGINE SERVICES:
THE PRESIDENT OF TURBINE ENGINE SERVICES REQUESTS THAT WE RECONSIDER
OUR DECISION IN GAS TURBINE CORPORATION, B-210411, MAY 25, 1983, 83-1
CPD 566. WE DISMISS THIS REQUEST.
IN OUR INITIAL DECISION, WE REJECTED AS UNTIMELY THE PROTESTER'S
ARGUMENT THAT THE INVITATION REQUIREMENTS WERE UNREASONABLE.
ADDITIONALLY, WE REJECTED THE PROTESTER'S ALLEGATION THAT THE AWARDEE,
WHOSE BID WE FOUND TO BE RESPONSIVE, WOULD NOT COMPLY WITH THE CONTRACT
REQUIREMENTS, CONCLUDING THAT THIS WAS A MATTER OF CONTRACT
ADMINISTRATION AND THEREFORE A RESPONSIBILITY OF THE CONTRACTING AGENCY.
THE REQUEST FOR RECONSIDERATION RAISES THE SAME TWO ISSUES RAISED IN
THE ORIGINAL PROTEST, NAMELY WHETHER THE SOLICITATION WAS INADEQUATELY
WRITTEN AND WHETHER THE AWARDEE HAS COMPLIED WITH THE CONTRACT TERMS.
THE REQUESTER STATES THAT HE IS MERELY AN "AGGRIEVED TAXPAYER" WHOSE
"... COMPANY WAS NOT A BIDDER NOR A SUB-CONTRACTOR ON THIS SOLICITATION
AND THEREFORE ... NOT AN AGGRIEVED PARTY FROM THE STANDPOINT OF LOSS OF
BUSINESS."
OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.9(A) (1983), PROVIDE
THAT THE PROTESTER, ANY INTERESTED PARTY WHO SUBMITTED COMMENTS DURING
CONSIDERATION OF THE PROTEST, AND ANY AGENCY INVOLVED IN A PROTEST MAY
REQUEST RECONSIDERATION OF A DECISION OF THE COMPTROLLER GENERAL. ON
OCCASION, WE HAVE OVERLOOKED THE REQUIREMENT FOR SUCH SUBMISSION OF
COMMENTS ON THE ORIGINAL PROTEST WHERE, FOR EXAMPLE, AN INTERESTED PARTY
WAS NOT NOTIFIED THAT THE PROTEST HAD BEEN FILED WITH OUR OFFICE. SEE
R.A. SCHEMEL & ASSOC., INC. - RECONSIDERATION, B-209707.2, SEPTEMBER 2,
1983, 83-2 CPD 291. HOWEVER, IN BOTH AN ORIGINAL PROTEST AND ON
RECONSIDERATION, WE STRICTLY CONSTRUE "INTERESTED PARTY" TO REQUIRE AN
INDIVIDUAL OR FIRM TO HAVE A DIRECT ECONOMIC INTEREST IN THE
PROCUREMENT.
IN CIRCUMSTANCES SIMILAR TO THOSE HERE, WE HAVE HELD THAT PRIVATE
PERSONS WHO DO NOT REPRESENT ANY ENTITY PARTICIPATING IN A QUESTIONED
PROCUREMENT AND PROTEST ONLY AS CONCERNED TAXPAYERS ARE NOT "INTERESTED
PARTIES" UNDER OUR BID PROTEST PROCEDURES, SINCE THEY ARE NOT
SUFFICIENTLY AFFECTED BY THE PROCUREMENT. SEE A. KENNETH BERNIER AND C.
J. WILLIS, B-186502, JULY 19, 1976, 76-2 CPD 56.
WE CONCLUDE THAT THE PRESIDENT OF TURBINE ENGINE SERVICES IS
INELIGIBLE TO REQUEST RECONSIDERATION OF THE GAS TURBINE CORPORATION
DECISION BECAUSE HE IS NOT AN INTERESTED PARTY WHO SUBMITTED COMMENTS
DURING CONSIDERATION OF THE PROTEST.
THE REQUEST FOR RECONSIDERATION IS DISMISSED.
B-210410, B-210449, B-210450, B-210451, APR 25, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTESTS CONCERNING ALLEGED FAILURE TO REQUIRE INSPECTION AND
ACCEPTANCE AT THE SOURCE FOR CRITICAL APPLICATION AIRCRAFT PARTS CONCERN
IMPROPRIETIES IN A SOLICITATION THAT ARE APPARENT AND THEREFORE MUST BE
FILED PRIOR TO THE CLOSING DATES FOR RECEIPT OF INITIAL QUOTATIONS.
AERO TUBE AND CONNECTOR COMPANY:
AERO TUBE AND CONNECTOR COMPANY PROTESTS A SERIES OF DEFENSE
CONSTRUCTION SUPPLY CENTER (DCSC) PROCUREMENTS. THESE INCLUDE: (1) A
PROCUREMENT UNDER REQUEST FOR QUOTATION (RFQ) DLA 700-82-T-Z056 FOR
COUPLING TUBES (B-210410); (2) A PROCUREMENT RESULTING IN THE AWARD OF
PURCHASE ORDER DLA 700-82-M-L498 FOR A PART IDENTIFIED AS NSN
4730-315-6703 (B-210449); (3) PROCUREMENTS UNDER RFQS DLA 700-82-T-KD49
AND DLA 700-82-T-HA30 FOR TUBE NUT ASSEMBLIES (B-210450); AND (4) A
PROCUREMENT UNDER RFQ DLA 700-83-Q-ZC02 FOR TUBE CAPS (B-210451). IN
EACH INSTANCE, AERO ASSERTS THAT DCSC HAS ERRONEOUSLY FAILED TO REQUIRE
INSPECTION AND ACCEPTANCE AT THE SOURCE WHICH AERO CONTENDS IS MANDATED
BY DEFENSE ACQUISITION REGULATION SEC. 14-305.2(B) (II) BECAUSE ALL OF
THE PARTS ARE CONSIDERED TO BE CRITICAL APPLICATION AIRCRAFT PARTS.
WE DISMISS THE PROTESTS.
IN B-210410 THE RECORD SHOWS THAT AERO FILED A PROTEST WITH DCSC ON
SEPTEMBER 29, 1982 AFTER LEARNING THAT AWARD HAD BEEN MADE UNDER
PURCHASE ORDER DLA 700-82-M-LP73. DCSC ULTIMATELY AGREED TO THE PROTEST
AND ATTEMPTED, UNSUCCESSFULLY, TO TERMINATE THE AWARD. AERO PROTESTS TO
OUR OFFICE BECAUSE IT IS NOT SATISFIED THAT DCSC ACTED DILIGENTLY IN
ATTEMPTING TO IMPLEMENT CORRECTIVE ACTION.
IT APPEARS THAT AERO'S ORIGINAL PROTEST TO DLA WAS UNTIMELY. SINCE
AERO SUBMITTED A QUOTATION IN RESPONSE TO THE RFQ, IT IS CLEAR THAT AERO
WAS ON NOTICE OF ITS CONTENTS, WHICH DID NOT IDENTIFY THE PARTS AS
CRITICAL OR CALL FOR INSPECTION AND ACCEPTANCE AT THE SOURCE. SECTION
21.2 (B)(1) OF OUR BID PROTEST PROCEDURES (4 C.F.R. SEC. 21.2(B) (1))
PROVIDES THAT A PROTEST CONCERNING A SOLICITATION DEFECT WHICH IS
APPARENT PRIOR TO A BID OPENING OR CLOSING DATE MUST BE FILED PRIOR TO
THAT DATE. UNDER SEC. 21.1(A) OF OUR PROCEDURES, A PROTEST INITIALLY
FILED WITH A CONTRACTING ACTIVITY WILL BE CONSIDERED BY OUR OFFICE ONLY
IF IT WAS ORIGINALLY FILED IN ACCORDANCE WITH THIS TIME LIMIT. BECAUSE
AERO WAITED UNTIL AFTER AWARD TO FILE ITS INITIAL AGENCY-LEVEL PROTEST,
ITS SUBSEQUENT PROTEST TO OUR OFFICE IS UNTIMELY.
THE PROTEST IN B-210451 IS DEFECTIVE FOR THE SAME REASON. AGAIN, THE
PROTESTER PARTICIPATED IN THE PROCUREMENT, AND THEREFORE, WAS ON NOTICE
OF ANY APPARENT SOLICITATION DEFECT. IT WAITED, HOWEVER, TO PROTEST TO
DCSC UNTIL DECEMBER 14, 1982, MORE THAN A MONTH AFTER AWARD HAD BEEN
MADE.
SIMILAR CONSIDERATIONS APPLY TO THE PROTESTS CONCERNING RFQ DLA
700-82-T-HA30 AND KD49 (B-210450). ACCORDING TO AERO, IT ADVISED THE
AGENCY OF THE NEED TO HAVE INSPECTION AT THE SOURCE BOTH WITH ITS
QUOTATIONS AND IN TELEPHONE CONVERSATIONS AND LETTERS. FOR EXAMPLE,
AERO STATES THAT IT ADVISED THE AGENCY OF THE DISCREPANCY CONCERNING
KD49 IN A TELEPHONE CONVERSATION ON OCTOBER 19, 1982. HOWEVER, THE
CLOSING DATE FOR KD49 OCCURRED 5 WEEKS EARLIER, ON SEPTEMBER 16, 1982.
REGARDING HA30, AERO ASSERTS IT ADVISED THE AGENCY OF ITS CONCERNS BY
LETTER DATED AUGUST 13, 1982, AND BY TELEPHONE ON NOVEMBER 22 AND
DECEMBER 2. THIS RFQ CLOSED ON NOVEMBER 4.
THIS PROTEST ALSO CONCERNS A DEFECT IN THE SOLICITATION WHICH WAS
APPARENT PRIOR TO THE CLOSING DATE AND THUS THE PROTEST HAD TO HAVE BEEN
FILED PRIOR TO THE CLOSING DATES. HOWEVER, AERO FILED ITS PROTEST WITH
THE AGENCY ON THESE PROCUREMENTS BY LETTER DATED DECEMBER 23, 1982; ON
JANUARY 4, 1983, AERO FILED A PROTEST WITH GAO.
MOREOVER, WE POINT OUT THAT EVEN IF THE AUGUST 13 LETTER TO THE
AGENCY CONCERNING HA30 WAS A PROTEST, THE AGENCY'S FAILURE TO TAKE
CORRECTIVE ACTION BY THE CLOSING DATE WOULD BE TREATED AS A DENIAL OF
THE PROTEST (REQUIRING A PROTEST TO OUR OFFICE WITHIN 10 WORKING DAYS).
PRECISION DYNAMICS CORPORATION, B-207823, JULY 9, 1982, 82-2 CPD 35. WE
ALSO POINT OUT THAT A PROTEST FILED WITH A QUOTATION IS NOT TIMELY.
GOVERNMENT INFORMATION SYSTEMS, DIVISION OF PLANNING RESEARCH
CORPORATION, 61 COMP.GEN. 614 (1982), 82-2 CPD 261.
THE PROTEST IN B-210449 WAS FILED WITH OUR OFFICE ON JANUARY 4, 1983.
AERO ORIGINALLY FILED ITS PROTEST WITH DCSC ON OR ABOUT MAY 7, 1982.
ON MAY 24, 1982, DCSC WROTE AERO AGREEING TO THE PROTEST AND STATING
THAT REMEDIAL STEPS WOULD BE TAKEN. THE PROTEST TO OUR OFFICE IS
UNTIMELY IN VIEW OF AERO'S APPARENT FAILURE TO PURSUE ITS CONCERNS IN A
DILIGENT FASHION. WE HAVE STATED THAT PROTESTERS MUST DILIGENTLY PURSUE
INFORMATION THAT FORMS THE BASIS OF A PROTEST, AND IF THEY DO NOT DO SO
WITHIN A REASONABLE TIME, OUR OFFICE WILL DISMISS AN ULTIMATELY-FILED
PROTEST AS UNTIMELY. MITEK SYSTEMS, INC., B-208786, SEPTEMBER 24, 1982,
82-2 CPD 274. AERO SIMPLY COULD NOT WAIT MORE THAN 7 MONTHS TO EXPRESS
DISSATISFACTION WITH THE AGENCY'S ATTEMPTED REMEDIAL ACTION.
FINALLY, WE POINT OUT THAT NONE OF THE FOUR PROTESTS RAISES AN ISSUE
WHICH WE WOULD BE INCLINED TO REVIEW SINCE THE PROTESTER IS SEEKING TO
HAVE INCLUDED IN SOLICITATIONS LANGUAGE WHICH WOULD TEND TO RESTRICT
COMPETITION TO APPROVED SOURCES. INCLUSION OF SUCH CLAUSES MAY BE A
MATTER OF PRACTICAL CONCERN TO THE PROCURING ACTIVITY, BUT GENERALLY
THEIR OMISSION IS NOT A MATTER OF LEGAL CONCERN. SEE EDCLIFF
INSTRUMENTS, B-205371, APRIL 26, 1982, 82-1 CPD 380.
THE PROTESTS ARE DISMISSED.
B-210409, FEB 3, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
THE DETERMINATION OF WHETHER TO AWARD A CONTRACT UNDER SECTION 8(A)
OF THE SMALL BUSINESS ACT IS A MATTER FOR THE CONTRACTING AGENCY AND
SBA. GAO WILL NOT REVIEW THAT DETERMINATION ABSENT A SHOWING OF FRAUD,
WILLFUL MISCONDUCT, OR VIOLATION OF A SPECIFIC REGULATION BY GOVERNMENT
OFFICIALS.
MARKETING FORETHOUGHT, INC.:
MARKETING FORETHOUGHT, INC. PROTESTS THE SMALL BUSINESS
ADMINISTRATION'S (SBA'S) AWARD TO ANOTHER FIRM OF A CONTRACT UNDER
SECTION 8(A) OF THE SMALL BUSINESS ACT, 15 U.S.C. SEC. 637(A) (SUPP. IV
1980), TO MEET THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION'S (EEOC'S)
NEEDS FOR PREPARATION OF CAMERA-READY TABLES FOR CERTAIN EEOC
PUBLICATIONS. BECAUSE THE CONTRACT MAY BE AWARDED ONLY TO A SOCIALLY
AND ECONOMICALLY DISADVANTAGED SMALL BUSINESS FIRM, THE PROTESTER (WHICH
IS A NON-DISADVANTAGED SMALL BUSINESS) WAS PREVENTED FROM COMPETING FOR
WORK WHICH IT SAYS IT HAS BEEN SUCCESSFULLY PERFORMING UNDER A PRIOR
CONTRACT. THE PROTESTER ADVANCES NO SUBSTANTIVE SUPPORT FOR ITS
PROTEST, BUT STATES THAT SBA HAS REFUSED TO FURNISH IT A COPY OF AN
IMPACT STATEMENT CONCERNING THE EXPECTED IMPACT OF SBA'S ACTION AND
SUBSEQUENT LOSS OF THIS CONTRACTING OPPORTUNITY ON THE PROTESTER. WE
DISMISS THE PROTEST.
THE PROTEST SUGGESTS THAT THE PROTESTER BELIEVES SBA ACTED
ARBITRARILY IN APPARENTLY REJECTING ITS CONTENTION THAT THE IMPACT ON IT
OF AN AWARD UNDER SEC. 8(A) JUSTIFIES NOT MAKING SUCH AN AWARD. SECTION
8(A) AUTHORIZES THE SBA TO ENTER INTO CONTRACTS WITH ANY GOVERNMENT
AGENCY WITH PROCURING AUTHORITY AND TO ARRANGE THE PERFORMANCE OF SUCH
CONTRACTS BY LETTING SUBCONTRACTS TO SOCIALLY AND ECONOMICALLY
DISADVANTAGED SMALL BUSINESS CONCERNS.
WE DO NOT REVIEW PROTESTS AGAINST DECISIONS TO AWARD CONTRACTS UNDER
SEC. 8(A) UNLESS THE PROTESTER SHOWS POSSIBLE FRAUD OR WILLFUL
MISCONDUCT OR ALLEGES A VIOLATION OF A SPECIFIC REGULATION BY GOVERNMENT
OFFICIALS. SEE KINGS POINT MANUFACTURING COMPANY, INC., 54 COMP.GEN.
913 (1975), 75-1 CPD 264; AMERICAN LAUNDRY, 58 COMP.GEN. 672 (1979),
79-2 CPD 49. THIS IS BECAUSE THE CONTRACTING OFFICER OF THE PROCURING
AGENCY IS AUTHORIZED IN HIS DISCRETION TO LET THE CONTRACT TO SBA AND
BECAUSE IT IS VESTED WITH BROAD DISCRETION IN DISCHARGING ITS PROGRAM
RESPONSIBILITIES.
HERE, THE PROTESTER HAS NOT ALLEGED FRAUD, WILLFUL MISCONDUCT, OR
VIOLATION OF REGULATIONS. ACCORDINGLY, THE PROTEST IS DISMISSED.
B-210406.3, FEB 15, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
PROTESTER ARGUES THAT DISTRICT OF COLUMBIA LAW
ON WHICH PRIOR DECISION DISMISSING PROTEST IS
BASED IS UNCONSTITUTIONAL, AND, THEREFORE,
PRIOR DECISION SHOULD BE REVERSED. WE AFFIRM
PRIOR DECISION BECAUSE IT IS FUNCTION OF
COURTS, NOT GAO, TO DECLARE STATUTES UNCONSTITUTIONAL,
AND COURTS HAVE NOT DONE SO.
ONSHORE SOG, INC. - REQUEST FOR RECONSIDERATION:
ONSHORE SOG, INC. (ONSHORE), REQUESTS RECONSIDERATION OF OUR DECISION
IN ONSHORE SOG, INC., B-210406.3, DECEMBER 22, 1983, 83-1 CPD
, WHICH DISMISSED ONSHORE'S PROTEST CONCERNING THE DISTRICT OF
COLUMBIA'S (DISTRICT) LEASING OF PUBLIC SPACE UNDER DUPONT CIRCLE.
IN THAT DECISION, WE STATED THAT BECAUSE D.C. LAW 1-4 (MAY 22, 1975)
GRANTS THE MAYOR OF THE DISTRICT BROAD DISCRETION IN SETTING FORTH
PROCEDURES FOR LEASING THE SPACE, WITH THE CAVEAT THAT THERE BE CITIZEN
PARTICIPATION IN THE SELECTION PROCESS, OUR REVIEW OF THE PROCEDURES IS
LIMITED TO THE QUESTION OF WHETHER THERE HAS BEEN CITIZEN PARTICIPATION.
SINCE ONSHORE DID NOT ALLEGE THAT THERE WAS NOT CITIZEN PARTICIPATION,
WE DISMISSED THE PROTEST.
ONSHORE NOW ARGUES THAT A JUNE 1983 UNITED STATES SUPREME COURT
RULING ON THE CONSTITUTIONALITY OF "ONE-HOUSE VETO POWER" INVALIDATED
THE DISTRICT OF COLUMBIA HOME RULE ACT, WHICH CONTAINS SUCH A PROVISION.
SINCE D.C. LAW 1-4 WAS PASSED UNDER THE AUTHORITY OF THE HOME RULE ACT,
ONSHORE ARGUES THAT IT IS VOID AND CANNOT BE THE BASIS OF A LEGAL
DECISION.
ONSHORE DID NOT PROVIDE A CITATION TO THE CASE, BUT WE ASSUME THAT IT
IS REFERRING TO IMMIGRATION AND NATURALIZATION SERVICE V. CHADHA,
U.S. , 103 S.CT. 2764 (1983). CHADHA HELD THAT THE LEGISLATIVE VETO
PROVISION OF THE IMMIGRATION AND NATIONALITY ACT, 8 U.S.C. SEC.
1254(C)(2) (1982), WAS UNCONSTITUTIONAL BECAUSE IT AMOUNTED TO LAWMAKING
WITHOUT THE CONSTITUTIONALLY MANDATED REQUIREMENTS OF BICAMERAL ACTION
AND PRESENTMENT TO THE PRESIDENT. THE COURT FOUND THAT THE LEGISLATIVE
VETO PROVISION WAS SEVERABLE FROM THE REMAINDER OF THE STATUTE AND,
THEREFORE, DECLARED ONLY THAT PROVISION UNCONSTITUTIONAL. NO COURT HAS
RULED ON THE CONSTITUTIONALITY OF THE DISTRICT OF COLUMBIA HOME RULE ACT
OR THE DISTRICT LAWS PASSED PURSUANT TO THE ACT.
WE HAVE HELD THAT IT IS NOT THE FUNCTION OF GAO TO DECLARE STATUTES
UNCONSTITUTIONAL; RATHER, IT IS A MATTER FOR THE COURTS. MASHBURN
ELECTRIC COMPANY, INC., ET AL., B-189471, APRIL 10, 1978, 78-1 CPD 277.
WE HAVE SPECIFICALLY ADOPTED THAT POSITION REGARDING THE LAWS OF THE
DISTRICT. NORTHERN VIRGINIA CHAPTER, ASSOCIATED BUILDERS AND
CONTRACTORS, INC., ET AL., B-202510, APRIL 24, 1981, 81-1 CPD 318. WE
NOTE THAT CHADHA CONTAINS NO INDICATION OF BROAD RETROACTIVE EFFECT
BEING INTENDED, PARTICULARLY REGARDING PRIOR ACTIONS (LAWS, REGULATIONS,
ETC.) THAT WERE SUBJECT TO UNEXERCISED LEGISLATIVE VETOES.
WE AFFIRM OUR DECISION.
B-210406.2, DEC 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST OF DISTRICT OF COLUMBIA PROCUREMENT FOR
THE LEASE OF PUBLIC SPACE UNDER DUPONT CIRCLE IS
DISMISSED BECAUSE D.C. LAW 1-4 (MAY 22, 1975)
GRANTS THE MAYOR OF THE DISTRICT BROAD DISCRETION IN SETTING
PROCUREMENT PROCEDURES.
ONSHORE SOG, INC.:
ONSHORE SOG, INC. (ONSHORE), PROTESTS THE AWARD OF A LEASE TO ANY
OFFEROR OTHER THAN ITSELF UNDER REQUEST FOR PROPOSALS NO.
RED-DC-OLN1210-82 ISSUED BY THE DISTRICT OF COLUMBIA (DISTRICT) FOR THE
RENTAL OF PUBLIC SPACE UNDER DUPONT CIRCLE.
WE DISMISS THE PROTEST.
THE PROTESTER INITIALLY ARGUED THAT THE SPACE IS OWNED BY THE FEDERAL
GOVERNMENT, NOT THE DISTRICT, AND CONTENDED THAT THE DISTRICT HAD
SELECTED AN OFFEROR WHO HAD OFFERED LESS THAN ONSHORE HAD OFFERED FOR
THE LEASE.
MORE RECENTLY, ONSHORE HAS ARGUED THAT THE PROPOSALS OF ITS
COMPETITORS SHOULD BE DISQUALIFIED FOR A VARIETY OF REASONS. ONSHORE
ALSO CONTENDS THAT ITS OFFER WAS ARBITRARILY AND CAPRICIOUSLY MISHANDLED
BY DISTRICT PROCUREMENT OFFICIALS.
WE HAVE HELD THAT OUR REVIEW OF PROCEDURES USED IN LEASING SPACE
UNDER DUPONT CIRCLE IS LIMITED TO THE QUESTION OF WHETHER THERE HAS BEEN
CITIZEN PARTICIPATION IN THE SELECTION PROCESS, BECAUSE D.C. LAW 1-4
(MAY 22, 1975) GRANTS THE MAYOR OF THE DISTRICT BROAD DISCRETION IN
SETTING THE PROCEDURES, WITH THE CAVEAT THAT THERE BE CITIZEN
PARTICIPATION IN THE SELECTION PROCESS. LAUFORD ASSOCIATES, INC.,
B-185561, MARCH 3, 1976, 76-1 CPD 154.
WE SEE NOTHING IN ONSHORE'S PROTEST THAT WOULD LEAD US TO MODIFY THAT
POSITION, AND ONSHORE HAS NOT ALLEGED THAT THERE WAS NOT CITIZEN
PARTICIPATION IN THE SELECTION PROCESS. CONSEQUENTLY, WE DISMISS
ONSHORE'S PROTEST.
WHILE WE WILL NOT CONSIDER THE MATTERS RAISED BY ONSHORE IN OUR BID
PROTEST CAPACITY, WE HAVE REFERRED THE DOCUMENTS IN THIS CASE TO OUR
AUDIT STAFF FOR CONSIDERATION.
B-210400, JAN 24, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTESTER'S CONTENTION THAT IT WAS UNFAIRLY DENIED AN EQUAL
OPPORTUNITY TO COMPETE AGAINST THE INCUMBENT BECAUSE THE AGENCY REJECTED
ITS REQUEST, MADE BEFORE BEST AND FINAL OFFERS WERE DUE, TO VISIT
GOVERNMENT FACILITIES WHICH WERE THEN OCCUPIED BY THE INCUMBENT
CONTRACTOR AND WHICH WERE SPECIFIED AS THE LOCATION FOR PERFORMANCE OF
THE CONTRACT, IS UNTIMELY. THE PROTESTER DID NOT FILE ITS PROTEST
WITHIN 10 WORKING DAYS AFTER BEST AND FINAL OFFERS WERE SUBMITTED, WHICH
IS THE LATEST DATE THE PROTESTER SHOULD HAVE KNOWN IT HAD TO COMPETE
WITHOUT THE REQUESTED VISIT AND THUS THE DATE THE BASIS FOR PROTEST
AROSE.
BIOQUAL, INC.:
BIOQUAL, INC. PROTESTS THE AWARD OF CONTRACT NO. ADM 281-83-0002, BY
THE ALCOHOL, DRUG ABUSE AND MENTAL HEALTH ADMINISTRATION OF THE
DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS). BIOQUAL CLAIMS THAT IT
WAS UNFAIRLY DENIED ACCESS TO THE GOVERNMENT FACILITIES WHICH WERE
SPECIFIED FOR PERFORMANCE OF THE CONTRACT AND WHICH WERE THEN IN USE BY
THE INCUMBENT CONTRACTOR, WHO WAS SUBSEQUENTLY AWARDED THE CONTRACT. WE
DISMISS THE PROTEST AS UNTIMELY.
OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.2(B)(2) (1982), REQUIRE
THAT A PROTEST AGAINST OTHER THAN AN APPARENT SOLICITATION IMPROPRIETY
BE RECEIVED BY EITHER THE CONTRACTING AGENCY OR OUR OFFICE WITHIN 10
WORKING DAYS AFTER THE BASIS FOR PROTEST IS KNOWN OR SHOULD HAVE BEEN
KNOWN.
IN ITS PROTEST, BIOQUAL INDICATES THAT IT REQUESTED PERMISSION TO SEE
THE FACILITIES PRIOR TO THE INITIAL SUBMISSION OF PROPOSALS, AND AGAIN,
BEFORE SUBMISSION OF BEST AND FINAL OFFERS. THUS, BIOQUAL WAS ON NOTICE
BY THE CLOSING DATE FOR BEST AND FINAL OFFERS - NOVEMBER 10, 1982 - THAT
IT HAD TO COMPETE WITHOUT INSPECTING THE FACILITIES. SEE TYMSHARE,
INC., B-205996, JANUARY 22, 1982, 82-1 CPD 50. BIOQUAL'S PROTEST WAS
FILED IN OUR OFFICE ON JANUARY 7, 1983. SINCE THE PROTEST WAS NOT FILED
WITHIN 10 WORKING DAYS AFTER NOVEMBER 10, 1982, THE PROTEST IS UNTIMELY.
EVEN IF WE INTERPRET BIOQUAL'S LAST CONTACT WITH HHS AS A
TIMELY-FILED PROTEST WITH THE PROCURING AGENCY, THE SUBSEQUENT PROTEST
TO OUR OFFICE WAS NEVERTHELESS UNTIMELY FILED. OUR BID PROTEST
PROCEDURES REQUIRE THAT WHERE A PROTEST HAS BEEN FILED INITIALLY WITH
THE PROCURING AGENCY, ANY SUBSEQUENT PROTEST TO OUR OFFICE MUST BE FILED
WITHIN 10 WORKING DAYS AFTER THE PROTESTER RECEIVES NOTICE OF THE
PROCURING AGENCY'S INITIAL ADVERSE ACTION ON THE PROTEST AT THAT LEVEL.
4 C.F.R. SEC. 21.2(A). SEE ART'S SUPPLIES & SERVICES, B-206885, MAY 3,
1982, 82-1 CPD 413. BIOQUAL HAD KNOWLEDGE OF HHS'S REJECTION OF ITS
REQUEST, WHICH WOULD CONSTITUTE THE AGENCY'S INITIAL ADVERSE ACTION, AT
LEAST BY NOVEMBER 10, 1982, WHEN THE AGENCY ACCEPTED FINAL PROPOSALS
WITHOUT PERMITTING BIOQUAL TO INSPECT THE FACILITIES. THEREFORE, THE
PROTEST FILED WITH OUR OFFICE ON JANUARY 7, 1983, IS CLEARLY UNTIMELY ON
THIS BASIS ALSO.
THE PROTEST IS DISMISSED.
B-210394, JUN 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST AGAINST REJECTION OF ITS BID BY GENERAL SERVICES
ADMINISTRATION (GSA) IS ACADEMIC SINCE PROTESTER OFFERED TO SUPPLY ITEMS
MANUFACTURED IN MAINLAND, CHINA, AND PUBLIC LAW 97-377 (96 STAT. 1830)
PROVIDED THAT NO PART OF ANY DEPARTMENT OF DEFENSE (DOD) APPROPRIATION
COULD BE USED TO PURCHASE ANY OF THE ITEMS IN QUESTION THAT WERE
MANUFACTURED IN A FOREIGN COUNTRY. DOD IS PRIMARY USER OF ITEMS.
LUTZ-SUPERDYNE:
LUTZ-SUPERDYNE (LUTZ) PROTESTS THE FINDING OF NONRESPONSIBILITY MADE
BY THE GENERAL SERVICES ADMINISTRATION (GSA) AND AWARD TO ANY OTHER
BIDDER UNDER INVITATION FOR BIDS (IFB) NO. FTP-BC-F0153-A.
THE PROTEST IS DISMISSED.
THE ABOVE SOLICITATION COVERED REQUIREMENTS FOR CALIPERS, MICROMETERS
AND DIVIDERS. LUTZ SUBMITTED THE APPARENT LOW BID FOR 14 ITEMS,
INCLUDING ITEMS 14 THROUGH 17 AND ITEM 22, WHICH LUTZ INDICATED WOULD BE
MANUFACTURED IN CHINA AND IMPORTED THROUGH THE FRED V. FOWLER COMPANY
(FOWLER).
A PLANT FACILITIES INSPECTION OF LUTZ'S FACILITIES WAS CONDUCTED AND,
WHILE THE INSPECTION REPORT WAS GENERALLY FAVORABLE, IT DID NOT MAKE A
RECOMMENDATION CONCERNING LUTZ'S RESPONSIBILITY, BUT INSTEAD SUGGESTED
THAT FOWLER'S FACILITIES BE INSPECTED. ALTHOUGH LUTZ OFFERED TO PROVIDE
UNNAMED JAPANESE SOURCES AS "BACK UP" SUPPLIERS IN THE EVENT THERE WERE
DELIVERY PROBLEMS WITH THE CHINESE MANUFACTURER, GSA STILL HAD CONCERNS
ABOUT LUTZ'S RESPONSIBILITY DUE TO ITS DOUBTS ABOUT FOWLER, LUTZ'S
PRIMARY SUPPLIER. AN INSPECTION OF FOWLER'S FACILITIES WAS CONDUCTED
AND IT WAS DETERMINED THAT IN SPITE OF THE FACT THAT FOWLER HAD MANY OF
THE ITEMS ON HAND, THERE WOULD BE A SLIPPAGE IN DELIVERY SCHEDULES. ON
THE BASIS OF THE NEGATIVE PLANT FACILITIES INSPECTION REPORT ON FOWLER,
LUTZ WAS FOUND TO BE NONRESPONSIBLE.
LUTZ CONTENDS THAT BOTH IT AND FOWLER ARE RESPONSIBLE FIRMS AND THAT
IT WOULD HAVE DELIVERED THE ITEMS IN QUESTION ON SCHEDULE.
SUBSEQUENT TO THE PLANT FACILITIES INSPECTION, ANOTHER DEVELOPMENT
WHICH HAD A BEARING ON LUTZ'S ELIGIBILITY TO RECEIVE AWARD WAS THE
PASSAGE OF PUBLIC LAW 97-377 (96 STAT. 1830), A JOINT RESOLUTION WHICH
CONTINUED APPROPRIATIONS FOR A NUMBER OF GOVERNMENT AGENCIES FOR THE
BALANCE OF 1983. SECTION 723 OF THE ACT, WHICH APPLIES TO THE
DEPARTMENT OF DEFENSE, PROVIDES, IN PART, THAT:
"NO PART OF ANY DOD APPROPRIATION CONTAINED
IN THIS ACT *** SHALL BE AVAILABLE FOR THE
PROCUREMENT OF *** HAND OR MEASURING TOOLS *** NOT
PRODUCED IN THE UNITED STATES OR ITS POSSESSIONS ***."
WE HAVE BEEN ADVISED THAT DOD IS THE PRIMARY USER OF THESE ITEMS.
THEREFORE, EVEN IF WE DETERMINED THAT GSA'S DETERMINATION THAT LUTZ WAS
NOT A RESPONSIBLE BIDDER WAS ERRONEOUS, LUTZ'S PROTEST IS ACADEMIC IN
LIGHT OF THE ABOVE STATUTORY PROHIBITION SINCE DOD IS PROHIBITED FROM
PLACING ORDERS AGAINST ANY REQUIREMENTS CONTRACT AWARDED TO LUTZ. SEE
INTERNATIONAL BUSINESS INVESTMENTS, B-209051, JANUARY 10, 1983, 83-1 CPD
23, AND BOMPART CLEANING SERVICE, B-210480, FEBRUARY 18, 1983, 83-1 CPD
174.
B-210392, JUN 10, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE AWARD IS MADE IN GOOD FAITH TO A FIRM ULTIMATELY FOUND NOT TO
HAVE BEEN THE LOW BIDDER BECAUSE OF A MISTAKE IN A HIGHER BID ALLEGED
ONLY AFTER AWARD WHICH, IF CORRECTED, WOULD HAVE DISPLACED THE AWARDEE
AS LOW, THE CONTRACT IS NOT ILLEGAL AND THEREFORE NEED NOT BE CANCELED.
IN ADDITION, GAO WILL NOT RECOMMEND TERMINATION FOR CONVENIENCE SINCE
THE BIDDER'S ERROR IN COMPUTING THE BID TOTAL AND ITS FAILURE TO BRING
THE ERROR TO THE CONTRACTING OFFICER'S ATTENTION BEFORE AWARD
CONTRIBUTED TO THE ERRONEOUS EVALUATION.
EAST BAY AUTO SUPPLY, INC.:
EAST BAY AUTO SUPPLY, INC. PROTESTS THE DEPARTMENT OF THE ARMY'S
AWARD OF A REQUIREMENTS CONTRACT TO OPERATE AN AUTO PARTS STORE AT FORT
BRAGG, NORTH CAROLINA, TO WHEELER BROTHERS, INC. UNDER INVITATION FOR
BIDS (IFB) NO. DAKF40-83-B-0004. EAST BAY, THE FOURTH LOW BIDDER, HAS
ALLEGED, AFTER THE AWARD TO WHEELER BROTHERS, A MATHEMATICAL MISTAKE IN
ITS BID. IF THE BID WERE CORRECTED, EAST BAY'S BID WOULD BE LOWER THAN
WAS WHEELER BROTHERS' BID. EAST BAY THEREFORE REQUESTS CORRECTION OF
ITS BID AND TERMINATION OF THE CONTRACT WITH WHEELER BROTHERS. WE DENY
THE PROTEST.
THE IFB WAS ISSUED ON NOVEMBER 17, 1982, WITH BID OPENING ON DECEMBER
22. THE IFB REQUESTED A SEPARATE BID FOR EACH OF FOUR LINE ITEMS, AND A
TOTAL PRICE FOR THE FOUR ITEMS (DESIGNATED AS ITEM NO. 5), UPON WHICH
THE BIDS WOULD BE EVALUATED. ELEVEN BIDS WERE RECEIVED, AND THE FOUR
LOWEST RESPONSIVE BIDS FOR ITEM NO. 5 WERE AS FOLLOWS:
WHEELER BROTHERS $646,768 T&L AUTO PARTS $656,210 ONE STOP AUTO PARTS
$656,290 EAST BAY
$661,608
AWARD WAS MADE TO WHEELER BROTHERS ON DECEMBER 23. BY LETTER OF
JANUARY 5, 1983 EAST BAY HAS ALLEGED A MATHEMATICAL ERROR IN ITS BID,
AND ASSERTED THAT THE TOTAL PRICE FOR THE FOUR ITEMS SHOULD HAVE BEEN
LISTED UNDER ITEM NO. 5 AS $643,608. THE MISTAKE ALLEGED IS IN EAST
BAY'S ADDITION OF THE FOUR LINE ITEMS ON THE SCHEDULE. EAST BAY
COMPLAINS THAT THE CONTRACTING OFFICER DID NOT VERIFY EAST BAY'S BID, IN
VIOLATION OF DEFENSE ACQUISITION REGULATION (DAR) SEC. 2-406.1 (1976
ED.), WHICH STATES THAT A CONTRACTING OFFICER SHALL EXAMINE ALL BIDS FOR
ERROR AND OBTAIN VERIFICATION FROM A BIDDER WHERE THERE IS A MISTAKE
SUSPECTED. EAST BAY SUGGESTS THAT THE CONTRACTING OFFICER SHOULD HAVE
ADDED THE FOUR LINE ITEMS HIMSELF TO INSURE THAT EAST BAY'S TOTAL
ENTERED IN ITEM NO. 5 WAS MATHEMATICALLY CORRECT.
EAST BAY IS CORRECT THAT A CONTRACTING OFFICER HAS A DUTY BEFORE
AWARDING A CONTRACT TO SCRUTINIZE ALL BIDS, INCLUDING THE FOURTH LOW
BID, FOR MISTAKES. WHERE, HOWEVER, AN AWARD IS MADE IN GOOD FAITH TO A
FIRM ULTIMATELY FOUND NOT TO HAVE BEEN THE LOW BIDDER BECAUSE OF A
MISTAKE IN ANOTHER BID DISCOVERED ONLY AFTER AWARD, THE AWARD IS NOT
ILLEGAL AND THUS NEED NOT BE CANCELED. R.A. JONES COMPANY, B-180293,
APRIL 26, 1974, 74-1 CPD 218. MOREOVER, ALTHOUGH IN SOME CASES WE HAVE
RECOMMENDED TERMINATION FOR CONVENIENCE OF A CONTRACT AWARDED TO OTHER
THAN THE ACTUAL LOW BIDDER, AND THEN AWARD TO THAT FIRM, WE GENERALLY
HAVE DONE SO ONLY WHERE THE ACTUAL LOW BIDDER DID NOTHING TO CONTRIBUTE
TO THE ERRONEOUS EVALUATION. WE STATED IN R.A. JONES, WHICH INVOLVED
FACTS VERY SIMILAR TO THOSE HERE, THAT WE WOULD NOT SIMILARLY DISTURB AN
AWARD WHERE THE ERRONEOUS EVALUATION APPEARS TO HAVE BEEN SIGNIFICANTLY
INFLUENCED BY THE BIDDER'S OWN ERROR IN THE PREPARATION OF ITS BID AND
THE BIDDER'S FAILURE TO ASSERT THE ERROR PRIOR TO AWARD.
SINCE THE AWARD TO WHEELER BROTHERS WAS NOT ILLEGAL, AND SINCE EAST
BAY MADE THE ERROR IN THE PREPARATION OF ITS BID SO THAT THE
CIRCUMSTANCES DO NOT WARRANT TERMINATION OF THE CONTRACT FOR THE
GOVERNMENT'S CONVENIENCE, WE DENY EAST BAY'S REQUEST FOR BID CORRECTION
AND AWARD TO IT.
THE PROTEST IS DENIED.
B-210390, MAR 13, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
WHETHER AN OFFEROR'S LACK OF INTEGRITY IS
SUFFICIENT TO WARRANT A FINDING OF
NONRESPONSIBILITY IS A MATTER PRIMARILY FOR
DECISION BY THE ADMINISTRATIVE OFFICERS
CONCERNED, AND GAO WILL NOT QUESTION THEIR
DECISION ABSENT A CLEAR SHOWING THAT IT
LACKED A REASONABLE BASIS.
AMERICANA DE COMESTIBLES S.A.:
AMERICANA DE COMESTIBLES S.A. (AMERCO) PROTESTS THE DEPARTMENT OF THE
ARMY'S DECISION THAT THE FIRM IS NONRESPONSIBLE FOR PURPOSES OF TWO
CONTRACT AWARDS FOR REFUSE COLLECTION AND DISPOSAL SERVICES AT DEFENSE
INSTALLATIONS IN THE REPUBLIC OF PANAMA UNDER REQUEST FOR PROPOSALS NO.
DAKF71-82-R-0160. WE DENY THE PROTEST.
UPON RECEIPT OF INITIAL PROPOSALS, THE CONTRACTING OFFICER LEARNED
THAT THE PRESIDENT OF AMERCO HAD BEEN UNDER INVESTIGATION BY THE ARMY
CRIMINAL INVESTIGATION DIVISION (CID) AND HAD BEEN IMPLICATED IN THE
THEFT OF COMMISSARY GOODS WHILE EMPLOYED AS THE REFUSE COLLECTION
MANAGER OF EXPRESS TRANSPORTATION SERVICES, INC. (ETS), THE PREVIOUS
CONTRACTOR FOR THE REQUIREMENT. THE CONTRACTING OFFICER ALSO NOTED THAT
AMERCO'S OFFERS, WHICH WERE THE LOWEST-PRICED FOR BOTH CONTRACTS, WERE
SIGNIFICANTLY BELOW THE GOVERNMENT'S ESTIMATE AND WELL BELOW THE RANGE
OF MOST OF THE OTHER OFFERS. A MEETING WAS HELD WITH AMERCO TO DISCUSS
THE FIRM'S FINANCIAL AND TECHNICAL CAPABILITIES, AFTER WHICH THE
CONTRACTING OFFICER CONCLUDED THAT THERE WAS UNCERTAINTY AS TO AMERCO'S
FINANCIAL CAPABILITY AND DOUBT AS TO ITS ABILITY TO SECURE NECESSARY
EQUIPMENT AND PERSONNEL TO COMMENCE OPERATIONS. IN ADDITION, HE
CONCLUDED THAT THE INVESTIGATIVE REPORTS OF THE ARMY CID CAST DOUBT AS
TO THE INTEGRITY OF AMERCO'S PRESIDENT AND THUS THE FIRM.
AMERCO'S BEST AND FINAL OFFERS WERE THE LOWEST-PRICED RECEIVED. THE
CONTRACTS WERE AWARDED TO TWO OTHER FIRMS, HOWEVER, AFTER THE
CONTRACTING OFFICER DETERMINED THAT AMERCO WAS NONRESPONSIBLE. THE
BASIS OF THE NONRESPONSIBILITY DETERMINATION WAS THAT (1) AMERCO'S
PRESIDENT DID NOT HAVE A SATISFACTORY RECORD OF INTEGRITY, (2) THE
FIRM'S PRICES WERE SO BELOW THE GOVERNMENT ESTIMATE THAT AMERCO COULD
NOT PERFORM THE SERVICES SATISFACTORILY, AND (3) AMERCO DID NOT HAVE
SUFFICIENT PERSONNEL AND EQUIPMENT TO BEGIN PERFORMANCE ON TIME.
AMERCO BASICALLY CONTENDS THAT THE RECORD FAILS TO PROVIDE SUFFICIENT
EVIDENCE TO ESTABLISH A LACK OF INTEGRITY, SINCE THE FIRM'S PRESIDENT
WAS NOT INDICTED ON THE ALLEGATIONS OF THEFT - AMERCO STATES THE
INDIVIDUAL INSTEAD WAS "CLEARED" BY THE ARMY CID. IN ADDITION, THE
PROTESTER CONTENDS THAT THE COMPANY HAS SUFFICIENT FINANCIAL AND
TECHNICAL RESOURCES TO PERFORM THE CONTRACT.
BEFORE THE AWARD OF A CONTRACT, THE CONTRACTING OFFICER MUST MAKE A
DETERMINATION THAT THE PROSPECTIVE CONTRACTOR IS RESPONSIBLE. DEFENSE
ACQUISITION REGULATION (DAR) SEC. 1-904.1 (1976 ED.). IF THE
INFORMATION AVAILABLE TO THE CONTRACTING OFFICER DOES NOT INDICATE
CLEARLY THAT THE PROSPECTIVE CONTRACTOR IS RESPONSIBLE, A DETERMINATION
OF NONRESPONSIBILITY IS REQUIRED. DAR SEC. 1-902; SPECO CORPORATION,
B-211353, APRIL 26, 1983, 83-1 CPD 458.
IN ORDER FOR A PROSPECTIVE CONTRACTOR TO BE DETERMINED RESPONSIBLE,
HE MUST HAVE A SATISFACTORY RECORD OF INTEGRITY, DAR SEC. 1-903.1(IV),
THE DEFINITION OF WHICH IS NO DIFFERENT THAN ITS GENERALLY ACCEPTED
CONNOTATION. SEE MAYFAIR CONSTRUCTION COMPANY, B-192023, SEPTEMBER 11,
1978, 78-2 CPD 187. WHETHER EVIDENCE OF AN OFFEROR'S LACK OF INTEGRITY
IS SUFFICIENT TO WARRANT A FINDING IN A PARTICULAR CASE THAT AN OFFEROR
IS NOT RESPONSIBLE IS A MATTER PRIMARILY FOR DETERMINATION BY THE
ADMINISTRATIVE OFFICERS CONCERNED, AND WE WILL NOT QUESTION THEIR
DETERMINATION IN THE ABSENCE OF A CLEAR SHOWING THAT IT LACKS A
REASONABLE BASIS. P.T.&L. CONSTRUCTION COMPANY, INC., 55 COMP.GEN.
343, 345 (1975), 75-2 CPD 208. IN THIS RESPECT, THE LACK OF INTEGRITY
OF OFFICERS, EMPLOYEES, OR OTHER ASSOCIATES OF AN OFFEROR IS PROPERLY
FOR CONSIDERATION IN DETERMINING THAT OFFEROR'S RESPONSIBILITY WHEN IT
APPEARS THAT SIGNIFICANT INFLUENCE MIGHT BE EXERCISED BY THOSE PERSONS
IN PERFORMANCE OF THE CONTRACT. SPECO CORPORATION, SUPRA.
AMERCO'S PRESIDENT CLEARLY CONTROLS THE COMPANY AND WOULD MANAGE
PERFORMANCE OF THE ARMY CONTRACTS. CONTRARY TO AMERCO'S SUGGESTION,
THERE IS NO INDICATION IN THE RECORD THAT THE PRESIDENT WAS "CLEARED" BY
THE ARMY CID. RATHER, THE INDICATION IN THE RECORD IS THAT THE ARMY CID
INVESTIGATION WAS TERMINATED PREMATURELY BECAUSE THE PERPETRATORS OF THE
THEFTS HAD BECOME AWARE OF THE INVESTIGATION. EVEN THOUGH AMERCO'S
PRESIDENT WAS NOT FORMALLY CHARGED WITH THE COMMISSARY THEFTS WHICH
OCCURRED WHILE HE WAS WORKING FOR ETS, FROM OUR REVIEW OF THE RECORD,
WHICH INCLUDES CONFIDENTIAL MATERIAL RELEVANT TO THE CID INVESTIGATION
THAT THE ARMY HAS ASKED NOT BE DISCLOSED TO THE PROTESTER, WE CANNOT SAY
THAT THE DETERMINATION BY THE CONTRACTING OFFICER WAS NOT BASED ON
SUBSTANTIAL EVIDENCE, OR LACKED A REASONABLE BASIS. SEE MAYFAIR
CONSTRUCTION COMPANY, SUPRA.
THE RECORD IS CLEAR THAT AMERCO'S PERCEIVED LACK OF INTEGRITY WAS
DEEMED SUFFICIENT IN ITSELF TO JUSTIFY THE CONTRACTING OFFICER'S FINDING
THAT THE FIRM WAS NOT RESPONSIBLE. WE THEREFORE NEED NOT CONSIDER THE
ISSUE OF AMERCO'S FINANCIAL AND TECHNICAL CAPABILITIES.
THE PROTEST IS DENIED.
B-210389.4; .5; .6, DEC 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. FIRMS AGAINST WHICH DEBARMENT PROCEEDINGS
WERE PENDING WERE ELIGIBLE FOR PARTICIPATION IN A DRAWING HELD TO
DETERMINE THE ORDER OF PRIORITY FOR NEGOTIATION ON THE LABOR
SURPLUS AREA SET-ASIDE PORTION OF A SOLICITATION. THE TERMS OF THE
SOLICITATION REQUIRED THE INCLUSION IN THE DRAWING OF ALL SMALL
BUSINESS CONCERNS WHICH SUBMITTED RESPONSIVE BIDS ON THE
NON-SET-ASIDE PORTION OF THE SOLICITATION, AND THE FACT THAT
DEBARMENT PROCEEDINGS ARE PENDING DOES NOT AFFECT BID
RESPONSIVENESS. THE PROPER TIME FOR DETERMINING THE EFFECT OF SUCH
PROCEEDINGS ON A FIRM'S ELIGIBILITY FOR A SET-ASIDE AWARD IS THE
TIME OF THAT AWARD.
2. GAO REJECTS AN ARGUMENT THAT A BID DOES NOT
EVIDENCE A CLEAR AND UNAMBIGUOUS COMMITMENT TO MEET THE
SOLICITATION'S LABOR SURPLUS AREA (LSA) REQUIREMENT BECAUSE THE
BID PRICE ALLEGEDLY IS INCONSISTENT WITH THE BIDDER'S INDICATION
THAT IT WILL PERFORM AS AN LSA CONCERN. UNDER THE FACTS AND
CIRCUMSTANCES OF THIS CASE, THE BID PRICE WAS NOT OBVIOUSLY
INCONSISTENT WITH THE BIDDER'S EXPRESS COMMITMENT TO PERFORM AS AN
LSA CONCERN.
3. A CONTRACTING AGENCY WAS NOT REQUIRED TO
CONDUCT A SECOND DRAWING, HELD TO CORRECT IMPROPRIETIES IN THE
FIRST DRAWING, IN A MANNER WHICH A PROTESTER ARGUES WOULD HAVE
BEEN LESS DISRUPTIVE TO THE RESULTS OF THE FIRST DRAWING THAN THE
MANNER CHOSEN.
4. NO MERIT IS FOUND TO A PROTESTER'S ASSERTION
THAT IT REACHED A BINDING AGREEMENT WITH AN AGENCY AFTER THE
AGENCY PHONED AND OFFERED IT THE OPPORTUNITY TO SUPPLY A QUANTITY
OF ITEMS LISTED IN THE WRITTEN SOLICITATION, AND THE PROTESTER
ACCEPTED THIS OFFER. THE AGENCY DISPUTES THE ALLEGATION THAT IT
MADE AN OFFER TO THE PROTESTER, AND THE PROTESTER'S INTERPRETATION
OF THE PHONE CONVERSATION IS INCONSISTENT WITH BOTH THE TERMS OF
THE SOLICITATION AND THE ORDINARY RULES CONCERNING GOVERNMENT
CONTRACT FORMATION.
KINGS POINT MFG. CO., INC.; GIBRALTAR INDUSTRIES, INC.; GEONAUTICS,
INC.:
KINGS POINT MFG. CO., INC. AND GEONAUTICS, INC. PROTEST UNDER THE
DEFENSE LOGISTICS AGENCY'S (DLA) INVITATION FOR BIDS (IFB) NO.
DLA100-83-B-0097 FOR GROUND TROOP HELMETS. THE IFB WAS A PARTIAL SMALL
BUSINESS/LABOR SURPLUS AREA (LSA) SET-ASIDE. THE PROTESTERS CONTEND
THAT DLA IMPROPERLY ALLOWED BIDDERS WHO EITHER WERE THE SUBJECT TO
DEBARMENT PROCEEDINGS OR WERE INELIGIBLE FOR CONSIDERATION AS LSA
CONCERNS TO PARTICIPATE IN A DRAWING FOR ORDER OF NEGOTIATION PRIORITY
UNDER THE SET-ASIDE. WE DENY THE PROTESTS.
GIBRALTAR INDUSTRIES, INC. ORIGINALLY JOINED IN THESE PROTESTS. IT
HAS SINCE INDICATED ITS AGREEMENT WITH THE AGENCY'S POSITION AND THUS,
IN EFFECT, HAS WITHDRAWN ITS PROTEST.
BACKGROUND
THE IFB SOLICITED BIDS ON A TOTAL QUANTITY OF 267,450 HELMETS -
133,730 ON AN UNRESTRICTED BASIS AND THE REMAINING 133,720 ON A
SET-ASIDE BASIS. THE THREE LOWEST BIDDERS ON THE UNRESTRICTED PORTION -
PINTLAR MANUFACTURING CORP., AQUA-AIRE PRODUCTS, INC., AND MARMAC
INDUSTRIES, INC. - WERE FOUND INELIGIBLE FOR AWARD BECAUSE, AFTER BID
OPENING, DLA INSTITUTED DEBARMENT PROCEEDINGS AGAINST THEM.
THE FINDING OF INELIGIBILITY FOR AWARD WAS MADE PURSUANT TO DEFENSE
ACQUISITION REGULATION (DAR) SEC. 1-605.1(D) (DAC #76-41, DECEMBER 27,
1982). THAT PROVISION STATES THAT IF NO SUSPENSION OF THE CONTRACTOR IS
IN EFFECT AT THE TIME DEBARMENT IS PROPOSED, BIDS SHALL NOT BE SOLICITED
FROM AND CONTRACTS SHALL NOT BE AWARDED TO THE CONTRACTOR PENDING A
DEBARMENT DECISION UNLESS AN AUTHORIZED OFFICIAL DETERMINES THERE IS A
COMPELLING REASON TO DO SO.
DLA SUBSEQUENTLY AWARDED 7,500 UNITS TO GIBRALTAR ON THE UNRESTRICTED
PORTION. THE REMAINING UNRESTRICTED QUANTITY WAS AWARDED TO GENTEX
CORPORATION. THEREAFTER, GIBRALTAR WAS REQUESTED TO OFFER ON THE
RESTRICTED PORTION IN ACCORDANCE WITH CLAUSE LD7 OF THE SOLICITATION,
WHICH PROVIDES:
"(B) PROCEDURES.
(1) DETERMINING ELIGIBILITY.
(A) TO BE ELIGIBLE TO PARTICIPATE IN THE
SET-ASIDE PORTION OF THIS ACQUISITION, A
SMALL BUSINESS CONCERN MUST SUBMIT A
RESPONSIVE OFFER ON THE NON-SET-ASIDE
PORTION ....
(2) DETERMINING PRIORITY FOR AWARD. SMALL
BUSINESS CONCERNS ELIGIBLE UNDER (1) ABOVE
WILL PARTICIPATE IN THE SET-ASIDE IN THE
FOLLOWING ORDER OF PRIORITY:
GROUP 1. LSA CONCERNS WHICH ARE ALSO
SMALL BUSINESS CONCERNS.
(A) A CONCERN IN THIS GROUP WHICH HAS
RECEIVED AN AWARD ON THE NON-SET-ASIDE
PORTION OF AN ITEM SHALL FIRST BE
REQUESTED TO OFFER THE SAME PERCENTAGE
OF THE SET-ASIDE PORTION. IF A PERCENTAGE
OF THE SET-ASIDE PORTION OF THE
ITEM REMAINS TO BE AWARDED, A DRAWING BY
LOT SHALL DETERMINE THE ORDER OF PRIORITY
WITHIN THIS GROUP FOR NEGOTIATIONS
FOR THE BALANCE OF THE ITEMS.
(B) IF ANY PART OF THE SET-ASIDE
PORTION REMAINS ... ALL LSA SMALL BUSINESS
CONCERNS MAY SUBMIT A BEST AND
FINAL OFFER FOR THE REMAINING PORTION."
GIBRALTAR WAS THE ONLY SMALL BUSINESS CONCERN CLAIMING LSA
ELIGIBILITY WHICH RECEIVED AN AWARD ON THE NON-SET-ASIDE PORTION OF THE
SOLICITATION. CONSEQUENTLY, DLA HELD A DRAWING BY LOT IN ORDER TO
ASCERTAIN THE ORDER OF PRIORITY, WITHIN THE GROUP OF REMAINING SMALL
BUSINESS CONCERNS CLAIMING LSA ELIGIBILITY, FOR NEGOTIATIONS FOR THE
BALANCE OF THE ITEMS. PINTLAR, AQUA-AIRE AND MARMAC, ALL SMALL
BUSINESSES CLAIMING LSA ELIGIBILITY, WERE EXCLUDED FROM THE DRAWING
BECAUSE OF THE DEBARMENT PROCEEDINGS PENDING AGAINST THEM.
AFTER THE DRAWING WAS HELD, HOWEVER, THE DEBARMENT PROCEEDINGS
AGAINST PINTLAR WERE TERMINATED. AS A RESULT, PINTLAR ONCE AGAIN BECAME
ELIGIBLE TO RECEIVE CONTRACT AWARDS.
IN THE COURSE OF CONSIDERING THE EFFECT OF PINTLAR'S CHANGED STATUS
ON THE PREVIOUSLY-ESTABLISHED ORDER OF NEGOTIATION PRIORITY, DLA CAME TO
THE CONCLUSION THAT ALL THREE BIDDERS WHO HAD BEEN EXCLUDED FROM THE
DRAWING SHOULD HAVE BEEN ALLOWED TO PARTICIPATE IN IT. IT BASED THIS
CONCLUSION ON ITS READING OF SECTION (B)(1)(A) OF CLAUSE LD7 (QUOTED
ABOVE) WHICH PROVIDED THAT TO BE ELIGIBLE TO PARTICIPATE IN THE
SET-ASIDE PORTION OF THE PROCUREMENT, A SMALL BUSINESS FIRM MUST SUBMIT
A RESPONSIVE OFFER ON THE NON-SET-ASIDE PORTION. DLA FOUND THAT SINCE
ALL THREE FIRMS IN FACT SUBMITTED RESPONSIVE BIDS ON THE NON-SET-ASIDE,
THEY SHOULD HAVE BEEN INCLUDED IN THE DRAWING.
ACCORDINGLY, A NEW DRAWING WAS HELD IN WHICH THE THREE PREVIOUSLY
EXCLUDED FIRMS WERE INCLUDED. AS A RESULT, THE ORDER OF NEGOTIATION
PRIORITY CHANGED, AND KINGS POINT AND GEONAUTICS FOUND THEMSELVES IN
LESS FAVORABLE POSITIONS THAN THEY PREVIOUSLY OCCUPIED.
EFFECT OF DEBARMENT PROCEEDINGS
KINGS POINT AND GEONAUTICS ARGUE THAT PINTLAR, AQUA-AIRE AND MARMAC
WERE PROPERLY EXCLUDED FROM THE FIRST DRAWING BECAUSE OF THE DEBARMENT
PROCEEDINGS PENDING AGAINST THEM. KINGS POINT ASSERTS THAT DLA'S
READING OF SECTION (B)(1)(A) OF CLAUSE LD7 IS INCORRECT. IT CONTENDS
THAT THE SECTION ONLY PRECLUDES THE INCLUSION OF A FIRM WHICH IS NOT A
SMALL BUSINESS OR WHICH DID NOT SUBMIT A RESPONSIVE BID ON THE
NON-SET-ASIDE, BUT DOES NOT REQUIRE THAT A FIRM BE INCLUDED JUST BECAUSE
IT MEETS THOSE CONDITIONS. GEONAUTICS ARGUES THAT EACH OF THE FIRM'S
ELIGIBILITY FOR AWARD WAS ESTABLISHED AT THE TIME OF AWARD ON THE
NON-SET-ASIDE, AND WAS NOT PROPERLY SUBJECT TO CHANGE.
DLA CONTENDS THAT THE EXCLUSION OF THE FIRMS FROM THE DRAWING
AMOUNTED TO A PREMATURE DETERMINATION OF NONRESPONSIBILITY. IT ASSERTS
THAT SECTION (B)(1)(A) RECOGNIZES THE CLASSIC DISTINCTION BETWEEN
RESPONSIBILITY AND RESPONSIVENESS BY PROVIDING FOR A SMALL BUSINESS
FIRM'S PARTICIPATION IN THE DRAWING PROVIDED THAT IT SUBMITS A
RESPONSIVE BID ON THE NON-SET-ASIDE. IT ALSO ARGUES THAT UNLIKE A
MATTER OF RESPONSIVENESS, WHICH MUST BE ESTABLISHED FROM THE BID ITSELF
AT THE TIME OF BID OPENING, A BIDDER'S STATUS DUE TO PENDING DEBARMENT
PROCEEDINGS IS SUBJECT TO CHANGE PRIOR TO THE TIME OF CONTRACT AWARD AND
THEREFORE SHOULD BE DETERMINED AT THE TIME OF CONTRACT AWARD.
WE AGREE WITH KINGS POINT THAT ON ITS FACE SECTION (B)(1)(A) APPEARS
ONLY TO ESTABLISH CERTAIN PREREQUISITES FOR PARTICIPATION IN THE
SET-ASIDE AND DOES NOT REQUIRE THAT A FIRM BE INCLUDED IN IT SIMPLY
BECAUSE THOSE PREREQUISITES ARE MET. NEVERTHELESS, WE BELIEVE THAT WHEN
THAT SECTION IS READ IN CONJUNCTION WITH SECTION (B)(2), THE BETTER
READING OF CLAUSE LD7 IS THAT IT CLEARLY CONTEMPLATES THE INCLUSION IN
THE DRAWING OF ALL SMALL BUSINESSES WHICH SUBMITTED RESPONSIVE BIDS ON
THE NON-SET-ASIDE PORTION OF THE PROCUREMENT. FOR EXAMPLE, SECTION
(B)(2) PROVIDES THAT FIRMS ELIGIBLE UNDER SECTION (B)( 1) "WILL
PARTICIPATE IN THE SET-ASIDE IN THE FOLLOWING ORDER OF PRIORITY," WITH
LSA SMALL BUSINESSES BEING GIVEN FIRST PRIORITY AND THE DRAWING BY LOT
BEING PROVIDED TO ESTABLISH PRIORITY WITHIN THAT GROUP. CONSEQUENTLY,
WE CONCLUDE THAT UNDER THE TERMS OF THE SOLICITATION, PINTLAR, AQUA-AIRE
AND MARMAC WERE ELIGIBLE FOR PARTICIPATION IN THE SET-ASIDE DRAWING
DESPITE THE DEBARMENT PROCEEDINGS PENDING AGAINST THEM.
FURTHER, WE AGREE WITH DLA THAT THE PROPER TIME FOR DETERMINING THE
EFFECT OF DEBARMENT PROCEEDINGS ON A FIRM'S ELIGIBILITY FOR A SET-ASIDE
AWARD IS THE TIME FOR THAT AWARD. WE BELIEVE OUR DECISION IN B-168496,
JANUARY 16, 1970, SUPPORTS THAT POSITION.
IN B-168496, WE HELD THAT AN AGENCY PROPERLY COULD AWARD A CONTRACT
TO A BIDDER THAT PROPOSED TO USE A SUBCONTRACTOR WHO WAS ON THE
DEPARTMENT OF DEFENSE CONSOLIDATED LIST OF DEBARRED, INELIGIBLE AND
SUSPENDED CONTRACTORS AT THE TIME OF BID OPENING, BUT WAS REMOVED FROM
THE LIST PRIOR TO AWARD. WE NOTED THAT WHILE THE DAR PROVIDED THAT BIDS
SHOULD NOT BE SOLICITED FROM AND CONTRACT AWARDS COULD NOT BE MADE TO
SUSPENDED OR DEBARRED BIDDERS, THERE WAS NO PROSCRIPTION AGAINST A
SUSPENDED OR DEBARRED FIRM SUBMITTING A BID EVEN THOUGH IT COULD NOT
RECEIVE AWARD UNLESS REMOVED FROM THE LIST. WE ALSO NOTED THAT
DEBARMENT OF FIRMS IS SOLELY FOR PROTECTION OF THE GOVERNMENT WHEN FOUND
WARRANTED AND THAT THE AGENCY COULD CONSENT TO A CONTRACT WITH A
DEBARRED FIRM WHEN DOING SO WAS IN THE BEST INTEREST OF THE GOVERNMENT.
WE CONCLUDED ON THE BASIS OF THESE FACTS THAT A FIRM'S STATUS AT THE
TIME OF CONTRACT AWARD, RATHER THAN THE TIME OF BID OPENING, WAS
DETERMINATIVE OF ITS ELIGIBILITY FOR CONTRACT AWARD.
ALTHOUGH THAT DECISION INVOLVES A SUSPENSION MADE PRIOR TO BID
OPENING AND THIS CASE INVOLVES A PROPOSED DEBARMENT INSTITUTED AFTER BID
OPENING, WE BELIEVE THAT THE SAME PRINCIPLES ARE APPLICABLE HERE.
THEREFORE, IN OUR VIEW, THE PROPER TIME FOR DETERMINING THE EFFECT OF
DEBARMENT PROCEEDINGS ON A FIRM'S ELIGIBILITY FOR AWARD UNDER THE
SET-ASIDE PORTION OF THIS PROCUREMENT WAS AT THE TIME OF CONTRACT AWARD
RATHER THAN AT THE TIME OF THE DRAWING BY LOT OR THE TIME OF AWARD ON
THE NON-SET-ASIDE PORTION OF THE PROCUREMENT.
THIS ASPECT OF KING POINT'S AND GEONAUTICS' PROTESTS IS DENIED.
PINTLAR'S LSA ELIGIBILITY
KINGS POINT ARGUES THAT PINTLAR'S BID DID NOT EVIDENCE A CLEAR AND
UNAMBIGUOUS COMMITMENT TO MEET THE IFB'S LSA REQUIREMENT. KINGS POINT
NOTES THAT A FIRM'S COMMITMENT TO MEET AN LSA REQUIREMENT IS A MATTER OF
RESPONSIVENESS, WHICH MUST BE ESTABLISHED AT THE TIME OF BID OPENING.
UFFNER TEXTILE CORPORATION, B-205050, DECEMBER 4, 1981, 81-2 CPD 443. IT
CONTENDS THAT A BID WHICH DOES NOT CLEARLY AND UNAMBIGUOUSLY MAKE THIS
COMMITMENT CANNOT PROPERLY BE INCLUDED IN THE FIRST PRIORITY GROUP FOR
PARTICIPATION IN THE SET-ASIDE: "LSA CONCERNS WHICH ARE ALSO SMALL
BUSINESS CONCERNS." THEREFORE, KINGS POINT ASSERTS, PINTLAR WAS NOT
ELIGIBLE TO PARTICIPATE IN, AND SHOULD NOT HAVE BEEN INCLUDED IN, EITHER
THE FIRST OR SECOND DRAWINGS HELD TO DETERMINE THE ORDER OF PRIORITY FOR
NEGOTIATION AMONG THOSE FIRMS.
KINGS POINT'S ARGUMENT RESTS ON THE PREMISE, FIRST PUT FORTH BY
GEONAUTICS, THAT AT PINTLAR'S BID PRICE OF $75 PER HELMET, IT IS
MATHEMATICALLY IMPOSSIBLE FOR PINTLAR TO MEET THE REQUIRED LSA
COMMITMENT. IN THIS RESPECT, CLAUSE LD7(C)(3) OF THE IFB REQUIRES THAT
TO BE CONSIDERED AN LSA CONCERN, THE AGGREGATE COSTS INCURRED BY A
CONCERN ON ACCOUNT OF MANUFACTURING OR PRODUCTION PERFORMED IN LSAS MUST
BE MORE THAN 50 PERCENT OF THE CONTRACT PRICE. KINGS POINT CALCULATES
THAT THE COSTS PINTLAR MUST INCUR IN NON-LSAS EXCEED 50 PERCENT OF ITS
BID PRICE.
KINGS POINT NOTES THAT THE SPECIFICATIONS REQUIRE THE USE OF KEVLAR
FIBER IN THE HELMETS, AND ASSERTS THAT THE FIBER IS AVAILABLE ONLY FROM
A SINGLE SOURCE, WHICH PRODUCES IT IN A NON-LSA. ACCORDING TO KINGS
POINT, THE COST OF THE FIBER IS $11.65 PER POUND, THE ABSOLUTE MINIMUM
AMOUNT OF FIBER PER HELMET NEEDED TO MEET THE SPECIFICATIONS IS 3.19
SQUARE YARDS, AND THE ABSOLUTE MINIMUM WEIGHT PER YARD IS 13.7 OUNCES.
KINGS POINT THEN CALCULATES THAT THE ABSOLUTE MINIMUM WEIGHT OF THE
FIBER FOR EACH HELMET MUST BE 2.73 POUNDS, WHICH AT A PRICE OF $11.65
PER POUND, YIELDS A COST OF $31.80 PER HELMET FOR FIBER. AFTER ADDING
THE COST OF GOVERNMENT-FURNISHED MATERIAL (GFM) OF $6.63 PER HELMET, FN1
KINGS POINT CONCLUDES THAT THE NON-LSA COST PER HELMET IS AT LEAST
$38.43, OR MORE THAN 50 PERCENT OF THE CONTRACT PRICE OF $75.
CONSEQUENTLY, KINGS POINT CONTENDS THAT EVEN THOUGH PINTLAR INDICATED
IN ITS BID THAT THE AGGREGATE COSTS IT WOULD INCUR IN AN LSA AMOUNT TO
MORE THAN 50 PERCENT OF ITS CONTRACT PRICE, ITS BID IS AMBIGUOUS BECAUSE
ITS BID PRICE IS INCONSISTENT WITH THAT COMMITMENT. IN SUPPORT OF ITS
POSITION, KINGS POINT CITES OUR DECISIONS IN KINGS POINT MFG. CO.,
B-205712, APRIL 5, 1982, 82-1 CPD 310 AND B-163181, FEBRUARY 7, 1968.
IN KINGS POINT, A BIDDER INDICATED IN ITS BID THAT MORE THAN 50
PERCENT OF ITS CONTRACT COSTS WOULD BE INCURRED IN A DESIGNATED LSA, BUT
IN ANOTHER PART OF THE BID IDENTIFIED A DIFFERENT PLACE OF PERFORMANCE
WHICH WAS NOT AN LSA. WE HELD THAT THE BID WAS AMBIGUOUS AS TO WHETHER
THE REQUISITE LSA COMMITMENT HAD BEEN MADE AND THAT IT COULD ONLY BE
CONSIDERED AS A NON-LSA BID.
IN B-163181, A BID FOR 25 INCH FLUORESCENT FIXTURES WAS FOUND
NONRESPONSIVE BECAUSE INFORMATION INCLUDED IN THE BID INDICATED A
MAXIMUM SHIPPING CONTAINER DIMENSION WHICH WAS LESS THAN THE REQUIRED
SIZE OF THE FIXTURE. WE FOUND THAT BECAUSE A FIXTURE OF THE REQUIRED
SIZE COULD NOT FIT INTO SUCH A CONTAINER, THE BID WAS AMBIGUOUS AND
COULD NOT BE ACCEPTED.
THIS CASE IS DISTINGUISHABLE FROM THE CASES CITED BY KINGS POINT. IN
THOSE CASES, INFORMATION INCLUDED IN THE BIDS CLEARLY ESTABLISHED THE
EXISTENCE OF AN AMBIGUITY ON THE FACE OF THE BID. HERE, WE DO NOT AGREE
THAT IT IS OBVIOUS THAT PINTLAR'S BID PRICE COMPROMISES THE FIRM'S
EXPRESS COMMITMENT TO PERFORM AS AN LSA CONCERN. FIRST, KINGS POINT'S
CONCLUSIONS ARE BASED ON CALCULATIONS THAT USE SELF-SERVING ASSUMPTIONS
ABOUT MATERIAL COST TO PINTLAR, THE AMOUNT OF FIBER NEEDED, AND FIBER
WEIGHT. SECOND, EVEN IF THE CONTRACTING OFFICER HAD SEEN FIT TO MAKE
THE CALCULATIONS KINGS POINT DOES, AND HAD MADE THE SAME ASSUMPTIONS AS
TO FIBER AMOUNT AND WEIGHT, HE ALSO WOULD HAVE HAD TO KNOW THE COST TO
THE CONTRACTOR OF THE KEVLAR FIBER. FINALLY, EVEN ASSUMING THAT THE
CONTRACTING OFFICER KNEW THE "GOING PRICE" OF THE FIBER, WE CANNOT
CONCLUDE HE NECESSARILY COULD PRESUPPOSE THAT PINTLAR PAID THAT PRICE
FOR IT. WE BELIEVE IT IS POSSIBLE THAT PINTLAR COULD HAVE NEGOTIATED A
MORE FAVORABLE PRICE WITH THE MANUFACTURER; ALREADY HAD THE FIBER AS
THE RESULT OF AN EARLIER PURCHASE AT A LOWER PRICE; OR COULD PURCHASE
IT MORE CHEAPLY FROM SOMEONE IN THAT POSITION.
IN SHORT, WE DO NOT ACCEPT KINGS POINT'S ARGUMENT THAT PINTLAR'S BID
WAS AMBIGUOUS WITH REGARD TO ITS LSA ELIGIBILITY. WE DO NOT CONSIDER ITS
$75 BID PRICE AS NECESSARILY INCONSISTENT WITH ITS COMMITMENT TO PERFORM
AS AN LSA.
WE NOTE HERE THAT GEONAUTICS SUGGESTS THE COST BREAKDOWN REQUESTED BY
THE CONTRACTING OFFICER FOR THE PURPOSES OF FINALLY DETERMINING LSA
ELIGIBILITY SHOULD HAVE BEEN REQUESTED PRIOR TO DETERMINING A FIRM'S
ELIGIBILITY FOR PARTICIPATION IN THE DRAWING, RATHER THAN AFTERWARDS.
WE DISAGREE. EXCEPT FOR THE PROMISE TO INCUR THE REQUISITE PROPORTION
OF COSTS IN LSAS, INFORMATION PERTAINING TO A FIRM'S LSA ELIGIBILITY
CONCERNS THE FIRM'S RESPONSIBILITY - ITS ABILITY TO MEET THE MATERIAL
TERMS OF THE CONTRACT - AND NEED NOT BE ESTABLISHED UNTIL THE TIME OF
CONTRACT AWARD. SEE UFFNER TEXTILE CORPORATION, SUPRA. SINCE THE
CONTRACTING OFFICER'S REQUEST FOR A COST BREAKDOWN FROM EACH BIDDER
CLEARLY WAS FOR THE PURPOSE OF ESTABLISHING THE BIDDER'S RESPONSIBILITY,
WE FIND NOTHING IMPROPER IN THE TIMING OF HIS REQUEST. SEE CHEMTECH
RUBBER, INC., 60 COMP.GEN. 694 (1981), 81-2 CPD 232.
GEONAUTICS' AND KINGS POINT'S PROTEST CONCERNING PINTLAR'S LSA
ELIGIBILITY ARE DENIED. FOR THE RECORD, HOWEVER, WE NOTE THAT THE
CONTRACTING OFFICER FOUND PINTLAR NONRESPONSIBLE AND REFERRED THE MATTER
TO THE SMALL BUSINESS ADMINISTRATION FOR POSSIBLE ISSUANCE OF A
CERTIFICATE OF COMPETENCY (COC). PINTLAR, HOWEVER, DECLINED TO FILE FOR
A COC AND WAS ELIMINATED FROM FURTHER CONSIDERATION FOR CONTRACT AWARD.
CONDUCT OF THE SECOND DRAWING
KINGS POINT ARGUES THAT EVEN IF IT WAS PROPER FOR THE AGENCY TO HOLD
A SECOND DRAWING TO INCLUDE PINTLAR, AQUA-AIRE AND MARMAC, IT SHOULD
HAVE BEEN DONE IN THE MANNER WHICH WAS LEAST DISRUPTIVE TO THE RESULTS
OF THE INITIAL DRAWING. THE APPROACH KINGS POINT SUGGESTS IS TO HOLD A
SUPPLEMENTAL DRAWING FOR THE THREE BIDDERS EXCLUDED FROM THE FIRST
DRAWING. EACH BIDDER WOULD DRAW A NUMBER WHICH WOULD BE USED TO
ESTABLISH ITS POSITION WITHIN THE ORDER OF PRIORITY ALREADY SET BY THE
INITIAL DRAWING. THUS, IF A FIRM IN THE SUPPLEMENTAL DRAWING DREW
SECOND POSITION, IT WOULD BE PLACED SECOND IN THE ORDER OF PRIORITY
ESTABLISHED BY THE FIRST DRAWING AND THE OTHER FIRMS WOULD BE MOVED DOWN
ONE POSITION.
KINGS POINT ASSERTS THAT A COMPLETE NEW DRAWING, SINCE IT IS
PREJUDICIAL TO THE BIDDERS WHO PARTICIPATED IN THE FIRST DRAWING, SHOULD
NOT BE UNDERTAKEN MERELY BECAUSE OF A PROCEDURAL IRREGULARITY. IT CITES
OUR DECISION IN 44 COMP.GEN. 661 (1965) WHICH INVOLVED A DRAWING HELD TO
DETERMINE WHICH OF TWO TIE BIDS WOULD RECEIVE THE AWARD. WE FOUND THAT
THE AGENCY'S FAILURE TO ALLOW THE TIED BIDDERS TO WITNESS THE DRAWING
WOULD NOT JUSTIFY A REDRAWING EVEN THOUGH THIS FAILURE WAS INCONSISTENT
WITH THE APPLICABLE REGULATORY REQUIREMENTS. WE STATED THAT:
"SINCE THE OFFICIAL RECORD ESTABLISHES
THAT THE AWARD WAS MADE TO THE LOWEST ELIGIBLE
BIDDER, WE WOULD NOT BE JUSTIFIED IN
DISTURBING THE AWARD BECAUSE A PROCEDURAL
REGULATION OF THE TYPE HERE IN QUESTION WAS
NOT STRICTLY FOLLOWED WHERE TO DO SO WOULD
GIVE ANOTHER ELIGIBLE BIDDER A SECOND OPPORTUNITY
TO COMPETE FOR THE AWARD."
THE CITED DECISION CLEARLY IS INAPPOSITE. THE EXCLUSION OF PINTLAR,
AQUA-AIRE AND MARMAC FROM THE FIRST DRAWING CANNOT FAIRLY BE
CHARACTERIZED AS A MERE PROCEDURAL IRREGULARITY. THEIR EXCLUSION WAS
CONTRARY TO THE TERMS OF THE SOLICITATION AS WELL AS INCONSISTENT WITH A
PROPER DETERMINATION OF THEIR ELIGIBILITY TO PARTICIPATE IN THE
SET-ASIDE. WE DO NOT REGARD THESE MATTERS AS OF MINOR SIGNIFICANCE, AND
WE BELIEVE THAT CORRECTIVE ACTION ON THE AGENCY'S PART WAS CLEARLY
REQUIRED HERE.
WHILE KINGS POINT'S CONCERN OVER THE DISRUPTION OF THE ORDER OF
PRECEDENCE ESTABLISHED UNDER THE FIRST DRAWING IS UNDERSTANDABLE AND ITS
PROPOSED ALTERNATIVE TO A COMPLETE REDRAWING IS ATTRACTIVE, WE DO NOT
VIEW THAT APPROACH AS A MANDATORY ONE. IN OUR VIEW, IT WAS WITHIN THE
AGENCY'S DISCRETION TO CONDUCT A COMPLETE NEW DRAWING, AND WE NOTE THAT
THE AGENCY DID SO IN AN ATTEMPT TO ACHIEVE FAIRNESS TO ALL BIDDERS.
THUS, ALTHOUGH KINGS POINT'S APPROACH MAY HAVE BEEN LESS DISRUPTIVE TO
THE RESULTS OF THE ORIGINAL DRAWING, WE CANNOT CONCLUDE THAT THE
AGENCY'S APPROACH WAS UNREASONABLE.
ALLEGED BINDING AGREEMENT
BETWEEN DLA AND GEONAUTICS
GEONAUTICS CONTENDS THAT IT RECEIVED AN OFFER FROM THE AGENCY AFTER
THE FIRST DRAWING TO SUPPLY 10,000 HELMETS, AND THAT IT ACCEPTED THIS
OFFER. IT THEREFORE ARGUES THAT IT HAS A BINDING AGREEMENT WITH THE
AGENCY FOR THE PURCHASE OF THOSE HELMETS REGARDLESS OF THE RESULTS OF
THE SECOND DRAWING. THE AGENCY DISPUTES THIS CONTENTION.
DLA STATES THAT AFTER THE FIRST DRAWING, IT DID PLACE PHONE CALLS TO
VARIOUS FIRMS, INCLUDING GEONAUTICS, AND REQUESTED THAT THEY OFFER ON
VARIOUS PORTIONS OF THE SET-ASIDE QUANTITY. THUS, IT IS DLA'S POSITION
THAT IT REQUESTED AN OFFER FROM GEONAUTICS RATHER THAN MAKING AN OFFER
TO IT.
THE AGENCY ASSERTS THAT THE TERMS OF THE SOLICITATION SUPPORT ITS
POSITION. IT CITES CLAUSE L63 OF THE IFB, WHICH PROVIDES:
"L63 UNILATERAL AWARD PROCEDURES ON PARTIAL
SET-ASIDES ...
(A) OFFERS OBTAINED UNDER THE PROVISIONS
OF THE SET-ASIDE CLAUSE ... SHALL BE IN
WRITING AND SHALL INCLUDE (I) AGREEMENT
AS TO THE ESTABLISHED SET-ASIDE PRICE ...,
(II) AGREEMENT AS TO THE
REQUIRED DELIVERY, (III) AGREEMENT THAT
ALL OTHER TERMS AND CONDITIONS OF THE
SOLICITATION WILL APPLY ...."
SUBSECTION (C) OF THE CLAUSE GOES ON TO PROVIDE THAT "AWARD OF THE
SET-ASIDE PORTION WILL BE MADE UTILIZING STANDARD FORM 26."
GENERALLY, THE INTENTION OF THE PARTIES DETERMINES WHETHER A CONTRACT
ARISES BEFORE A CONTEMPLATED WRITING IS EXECUTED. MOTOROLA, INC.,
B-191339, OCTOBER 19, 1978, 78-2 CPD 287. FURTHERMORE, IN DETERMINING
WHETHER A BINDING COMMITMENT EXISTS WITHOUT A WRITING, WE WILL FOCUS ON
WHETHER THE ACTIONS OF THE GOVERNMENT WOULD LEAD A REASONABLE BIDDER TO
BELIEVE THAT SUCH ACTIONS WERE INTENDED FOR IT TO ACT UPON WITHOUT
OBTAINING A WRITTEN CONFIRMATION THAT IT WAS THE INTENDED CONTRACTOR.
ID.
HERE, AS EVIDENCED BY CLAUSE L63, THE SOLICITATION CLEARLY
CONTEMPLATED THAT WRITTEN OFFERS FIRST WOULD BE SOLICITED AND OBTAINED
FROM ELIGIBLE CONCERNS AND THAT CONTRACT AWARD WOULD THEN BE MADE IN
WRITING. CONSEQUENTLY, WHILE THE EXACT CONTENT OF DLA'S PHONE
CONVERSATION WITH GEONAUTICS IS IN DISPUTE, DLA'S POSITION IS CONSISTENT
WITH THE TERMS OF THE IFB. IT IS ALSO CONSISTENT WITH THE ORDINARY
RULES OF OFFER AND ACCEPTANCE IN GOVERNMENT CONTRACTING, IN WHICH THE
IFB IS A REQUEST FOR AN OFFER, THE BID IS THE OFFER AND THE GOVERNMENT'S
AWARD IS THE ACCEPTANCE. SEE VANGUARD INDUSTRIAL CORPORATION -
RECONSIDERATION, B-204455.2, MARCH 1, 1982, 82-1 CPD 174.
WE CONCLUDE THAT GIVEN THE SOLICITATION'S CLEAR INDICATION OF THE
AGENCY'S INTENT TO SOLICIT WRITTEN OFFERS PRIOR TO MAKING A WRITTEN
AWARD, AS WELL AS THE ORDINARY RULES CONCERNING GOVERNMENT CONTRACT
FORMATION, IT WAS UNREASONABLE FOR GEONAUTICS TO ASSUME THAT A BINDING
AGREEMENT AROSE FROM ITS PHONE CONVERSATION WITH DLA. ACCORDINGLY, ITS
PROTEST ON THIS ISSUE IS DENIED.
CONCLUSION
BOTH GEONAUTICS' AND KINGS POINT'S PROTESTS ARE DENIED.
FN1 GIBRALTAR, WHICH DOES NOT WANT A REDRAWING, ATTEMPTS TO REBUT
KINGS POINT'S CALCULATIONS BY ARGUING THAT GFM SHOULD NOT BE TREATED AS
A NON-LSA COST. HOWEVER, THE CONTRACTING OFFICER ADVISED EACH BIDDER IN
WRITING THAT GFM, TRANSPORTATION AND PROFIT WERE CONSIDERED NON-LSA
COSTS. THEREFORE, FOR THE PURPOSES OF ARGUMENT, WE WILL ASSUME THAT
KINGS POINT IS CORRECT.
B-210376.2, JUL 31, 1984, 84-2 CPD 131
CONTRACTS - PROTESTS - GENERAL ACCOUNTING OFFICE PROCEDURES -
RECONSIDERATION REQUESTS - TIMELINESS
DIGEST:
1. NEW ISSUE RAISED IN REQUEST FOR RECONSIDERATION IS DISMISSED AS
UNTIMELY BECAUSE THE ISSUE IS BASED ON INFORMATION CONTAINED IN THE
AGENCY REPORT ON THE ORIGINAL PROTEST, BUT WAS NOT RAISED WITHIN 10
WORKING DAYS AFTER RECEIPT OF THE REPORT.
CONTRACTS - PROTESTS - ALLEGATIONS - NOT PREJUDICIAL
2. ALTHOUGH IT WAS UNCLEAR THAT A QUANTITY ESTIMATE IN THE
SOLICITATION COVERED TWO DIFFERENT TYPES OF WORK, BUT PROTESTER ONLY
INCLUDED THE ACTUAL TOTAL ESTIMATED QUANTITY OF WORK IN ITS PROPOSAL AND
HAS NOT ALLEGED THAT ITS PRICE WOULD HAVE BEEN LOWER IF THE ESTIMATE'S
COVERAGE HAD BEEN BROKEN DOWN, THE PROTESTER WAS NOT PREJUDICED.
CONTRACTS - IN-HOUSE PERFORMANCE V. CONTRACTING OUT - COST COMPARISON
3. WHERE EXCLUSION OF OVERTIME COSTS FROM IN-HOUSE COST ESTIMATE IS
INITIALLY JUSTIFIED ON BASIS OF PLANNED CHANGES TO THE AGENCY'S STAFFING
AND ORGANIZATIONAL STRUCTURE, BUT IT LATER APPEARS THAT CERTAIN OF THE
STAFFING CHANGES WILL NOT TAKE PLACE, THE ORIGINAL DECISION UPHOLDING
THE COST COMPARISON WILL BE AFFIRMED WHERE RECORD SUPPORTS THE
CONCLUSION REACHED ALBEIT FOR A DIFFERENT REASON.
CONTRACTS - PROTESTS - ALLEGATIONS - UNSUBSTANTIATED
4. NO MERIT IS FOUND TO ALLEGATION THAT ACTUAL HOURS OF OVERTIME
WORKED IN A FACILITY AFTER THE PROTEST WAS FILED DEMONSTRATE THAT THE
AGENCY ERRED IN EXCLUDING OVERTIME HOURS FROM ITS IN-HOUSE COST
ESTIMATE. THE ACTUAL OVERTIME HOURS RELIED ON BY THE PROTESTER INCLUDE
OVERTIME FUNCTIONS NOT INVOLVED IN THE COST COMPARISON, AND WERE
INCURRED BEFORE IMPLEMENTATION OF THE MORE EFFICIENT ORGANIZATIONAL
STRUCTURE ON WHICH THE COST COMPARISON WAS BASED.
FACILITIES ENGINEERING & MAINTENANCE CORPORATION - REQUEST FOR
RECONSIDERATION:
FACILITIES ENGINEERING & MAINTENANCE CORPORATION (FEMCOR) REQUESTS
THAT WE RECONSIDER OUR DECISION IN FACILITIES ENGINEERING & MAINTENANCE
CORPORATION, B-210376, SEPT. 27, 1983, 83-2 CPD PARA. 381. IN THAT
DECISION, WE DENIED THE FIRM'S PROTEST AGAINST THE DEPARTMENT OF THE
ARMY'S DECISION TO CANCEL REQUEST FOR PROPOSALS (RFP) NO.
DAAK21-82-R-9495 FOR THE OPERATION AND MAINTENANCE OF PLANT EQUIPMENT,
BUILDINGS AND GROUNDS AT THE HARRY DIAMOND LABORATORIES IN ADELPHI,
MARYLAND.
WE AFFIRM OUR DECISION.
THE RFP WAS ISSUED AS PART OF A COST COMPARISON TO DETERMINE WHETHER
IT WOULD BE MORE ECONOMICAL TO CONTRACT FOR THE SERVICES OR TO CONTINUE
TO PERFORM THEM IN-HOUSE. THE ARMY CANCELED THE SOLICITATION AFTER
DETERMINING THAT IN-HOUSE PERFORMANCE WOULD BE LESS EXPENSIVE THAN
CONTRACTING WITH FEMCOR, WHICH SUBMITTED THE MOST ADVANTAGEOUS OFFER IN
RESPONSE TO THE RFP. THE DIFFERENCE IN COST, AS CALCULATED AFTER THE
ARMY APPEALS BOARD RESOLVED FEMCOR'S ADMINISTRATIVE APPEAL OF THE
CANCELLATION DECISION, WAS $152,123.
FEMCOR PROTESTED THAT THE IN-HOUSE PERFORMANCE COSTS STILL WERE
UNDERSTATED IN THAT THE ARMY OMITTED THE COST OF ANTICIPATED OVERTIME
HOURS, OMITTED CERTAIN OVERHEAD COSTS, AND FAILED TO APPLY AN INFLATION
FACTOR TO CERTAIN LABOR COSTS. FEMCOR ALSO ASSERTED THAT THE ARMY
OVERESTIMATED THE COST OF CONTRACTING IN A NUMBER OF RESPECTS. IN
DENYING THE PROTEST, WE FOUND THAT THE ARMY'S COST ANALYSIS WAS
CONSISTENT WITH APPLICABLE GUIDANCE, OFFICE OF MANAGEMENT AND BUDGET
CIRCULAR NO. A-76 POLICY AND PROCEDURES.
FEMCOR'S REQUEST FOR RECONSIDERATION IS LIMITED TO OUR FINDING THAT
THE ARMY WAS REASONABLE IN NOT INCLUDING THE COST OF ANTICIPATED
EMERGENCY OVERTIME HOURS OF LABOR IN THE IN-HOUSE CALCULATION. THE RFP
REQUIRED THE CONTRACTOR TO HAVE PERSONNEL ON CALL 24 HOURS PER DAY FOR
AFTER-HOURS EMERGENCY WORK, AND ESTIMATED, BASED ON HISTORICAL DATA,
THAT 2,373 HOURS OF AFTER-HOURS EMERGENCY WORK WOULD BE REQUIRED
ANNUALLY. FEMCOR BASED ITS PRICE ON 2,373 OVERTIME HOURS AND CONTENDED
THAT THE ARMY, BY FAILING TO INCLUDE THE COST OF 2,373 EMERGENCY
OVERTIME HOURS IN THE IN-HOUSE ESTIMATE AS WELL, HELD FEMCOR TO A
BROADER SCOPE OF WORK THAN THE GOVERNMENT REQUIRED OF ITSELF.
WE NOTED THAT APPROXIMATELY 400 OF THE PAST EMERGENCY OVERTIME HOURS
HAD BEEN EXPERIENCED IN THE CARPENTER/PAINT SHOP AS A RESULT OF
BACKLOGS; MORE THAN 700 WERE ATTRIBUTABLE TO THE ELECTRONICS SHOP; AND
THE REMAINING WERE INCURRED IN THE HEAT/CHILL PLANT. WE FOUND THAT THE
ARMY HAD TAKEN STEPS TO ELIMINATE THE OVERTIME COSTS AT EACH LOCATION,
AND THE IN-HOUSE ESTIMATE REFLECTED THE COSTS OF THESE ACTIONS: THE
ARMY (1) ADDED A CARPENTER TO THE CARPENTER/PAINT SHOP, AND INCLUDED HIS
SALARY AS AN IN-HOUSE COST; (2) SCHEDULED A NIGHT SHIFT IN THE
ELECTRONICS SHOP, AND ADDED AN ELECTRICAL MECHANIC, WITH BOTH THE SHIFT
DIFFERENTIAL AND THE MECHANIC'S SALARY ADDED TO THE IN-HOUSE COSTS; AND
(3) BOTH IMPROVED ITS MAINTENANCE PROCEDURES AND DESIGNED MORE EFFICIENT
SCHEDULES TO ELIMINATE THE NEED FOR OVERTIME IN THE HEAT/ CHILL PLANT.
WE CONCLUDED THAT THE ARMY'S TREATMENT OF OVERTIME COSTS WAS
REASONABLE AND CONSISTENT WITH APPLICABLE GUIDANCE:
"IN EFFECT, THE ARMY BELIEVES THAT IT WILL BE ABLE TO ELIMINATE
OVERTIME HOURS IN THE FUTURE BUT THAT FEMCOR, DUE TO STAFF LIMITATIONS,
WILL NOT BE ABLE TO AVOID THE OVERTIME IN PERFORMING THE SAME TASKS.
THIS POSITION IS REASONABLE ON ITS FACE. ALTHOUGH FEMCOR DISAGREES WITH
THE ARMY THAT GOVERNMENT OVERTIME COSTS CAN BE ELIMINATED THROUGH
STAFFING AND OTHER CHANGES, FEMCOR HAS NOT PRESENTED ANY SPECIFIC
REASONS WHY THE ARMY'S ACTIONS WILL NOT HAVE THEIR INTENDED EFFECT.
MOREOVER, THE ARMY INCLUDED IN THE IN-HOUSE ESTIMATE THE EXTRA COSTS
(SALARY AND SHIFT DIFFERENTIAL) INCURRED TO LIMIT OVERTIME.
"... THE ARMY DID NOT COMPARE UNEQUAL SCOPES OF WORK AS FEMCOR
ALLEGES, BUT INSTEAD ASSUMED THAT THE GOVERNMENT, WITH A LARGER STAFF
AND GREATER RESOURCES DEDICATED TO THE TASK, COULD PERFORM THE WORK
SPECIFIED IN THE RFP WITHOUT RESORT TO OVERTIME. THIS OFFICE HAS
RECOGNIZED THAT THE GOVERNMENT MAY HAVE INHERENT ADVANTAGES IN
ORGANIZING ITS MANPOWER THAT A CONTRACTOR CANNOT ACHIEVE IN AN A-76
EXERCISE. ... THE FACT THAT THE ARMY RELIED ON THOSE ADVANTAGES IN
ESTIMATING ITS COSTS DOES NOT INVALIDATE THE COST COMPARISON."
FEMCOR ADVANCES A NUMBER OF ARGUMENTS IN SUPPORT OF ITS
RECONSIDERATION REQUEST.
(1) FEMCOR ARGUES THAT THE 2,373 HOURS OF OVERTIME SHOULD NOT HAVE
BEEN INCLUDED IN THE RFP AT ALL. FEMCOR ALLEGES THAT THE ARMY ADMITTED,
IN ITS REPORT TO OUR OFFICE ON FEMCOR'S ORIGINAL PROTEST, THAT THE HOURS
REPRESENT A BACKLOG OF UNSCHEDULED WORK ORDERS OR PREVENTIVE
MAINTENANCE. FEMCOR CONTENDS THAT UNSCHEDULED WORK ORDERS AND
PREVENTIVE MAINTENANCE ARE COVERED ELSEWHERE IN THE RFP. THE FIRM
THEREFORE ASSERTS THAT IT WAS MISLED EITHER INTO BIDDING TWICE ON THE
SAME WORK OR INTO BIDDING OVERTIME RATES FOR WORK THAT IT MIGHT BE ABLE
TO ACCOMPLISH DURING NORMAL DUTY HOURS.
THE ARMY, WHILE ADMITTING THAT OVERTIME WORK HISTORICALLY HAS
INCLUDED, IN PART, BACKLOGGED WORK AND PREVENTIVE MAINTENANCE, CONTENDS
THAT THIS ALLEGATION IS UNTIMELY BECAUSE IT WAS NOT RAISED BEFORE THE
DEADLINE FOR FILING COMMENTS ON THE AGENCY REPORT, WHICH IS 10 WORKING
DAYS AFTER THE RECEIPT OF THE REPORT. 4 C.F.R. SEC. 21.3(D) (1984).
WE BELIEVE THE ARMY SHOULD HAVE SPECIFIED THAT THE HISTORICAL
2,373-HOUR FIGURE INCLUDED WORK ON BACKLOGS AND PREVENTIVE MAINTENANCE.
NEVERTHELESS, WE WILL NOT REVIEW THE ISSUE WITH RESPECT TO WHAT, IF ANY,
EFFECT THE MATTER HAS ON THE COST COMPARISON. SINCE THE ISSUE WAS NOT
INCLUDED IN FEMCOR'S ORIGINAL PROTEST, IT MUST INDEPENDENTLY SATISFY THE
TIMELINESS REQUIREMENTS OF OUR BID PROTEST PROCEDURES. SEE AIR-TECH
INDUSTRIES - RECONSIDERATION, B-211252.2, JUNE 28, 1983, 83-2 CPD PARA.
37. OUR PROCEDURES PROVIDE THAT PROTESTS SUCH AS THIS MUST BE FILED
WITHIN 10 WORKING DAYS AFTER THE BASIS OF PROTEST IS KNOWN OR SHOULD
HAVE BEEN KNOWN. 4 C.F.R. SEC. 21.2(B)(2). THE RECORD SHOWS THAT THE
INFORMATION ON WHICH FEMCOR BASES THIS CONTENTION WAS CONTAINED IN THE
AGENCY REPORT. SINCE THE ISSUE WAS NOT RAISED WITHIN 10 WORKING DAYS
AFTER FEMCOR RECEIVED THE REPORT, IT IS UNTIMELY AND WILL NOT BE
CONSIDERED.
(2) FEMCOR ARGUES THAT THE SOLICITATION WAS MISLEADING BECAUSE THE
2,373-HOUR ESTIMATE GIVEN FOR AFTER-HOURS EMERGENCY WORK ACTUALLY
INCLUDED REGULAR OVERTIME WORK AS WELL AS AFTER-HOURS EMERGENCY WORK.
FEMCOR BASES THIS CONTENTION ON INFORMATION RECEIVED WITH THE AGENCY
REPORT ON ITS REQUEST FOR RECONSIDERATION, AND WE THEREFORE CONSIDER IT
TIMELY RAISED.
THE RFP CONTAINED, AT PARAGRAPH 10.2.E., A CATEGORY OF WORK ENTITLED
"REQUIRED (AFTER HOURS) WORK" AND AT PARAGRAPH 10.2.F., A CATEGORY
ENTITLED "EMERGENCY WORK." THE REQUIRED (AFTER HOURS) WORK WAS DESCRIBED
AS TASKS THAT COULD NOT BE ACCOMPLISHED DURING NORMAL WORKING HOURS
BECAUSE THEY WOULD DISRUPT WORK OR BECAUSE OF SAFETY OR POLLUTION
HAZARDS. THE CONTRACTOR WAS REQUIRED TO INCLUDE THE COST OF SUCH WORK
IN ITS LUMP SUM BID. EMERGENCY WORK WAS DEFINED AS ANY WORK REQUIRED TO
CORRECT FAILURES OR DEFICIENCIES THAT WOULD CONSTITUTE AN IMMEDIATE
DANGER OR HEALTH HAZARD TO OCCUPANTS OR A THREAT TO PROPERTY. THE RFP
STATED THAT EMERGENCY WORK COULD BE REQUIRED DURING OR AFTER NORMAL
WORKING HOURS.
PARAGRAPH 10.2.G. OF THE RFP WAS ENTITLED "QUANTITY" AND CONTAINED
THE ESTIMATE THAT "2,373 MAN-HOURS OF REQUIRED AFTER HOURS EMERGENCY
WORK WILL BE REQUIRED. ... "THE ARMY'S REPORT STATES THAT THIS 2,373
HOURS INCLUDED BOTH THE REQUIRED (AFTER-HOURS) WORK AND EMERGENCY WORK
CATEGORIES, AND NOT JUST EMERGENCY WORK THAT HAD TO BE PERFORMED
AFTER-HOURS. IT CONTENDS THAT FEMCOR SHOULD HAVE REALIZED THAT
PARAGRAPHS 10.2.E., F., AND G. WERE INTENDED TO BE READ TOGETHER BUT
THAT EVEN IF IT DID NOT, FEMCOR WAS NOT PREJUDICED BY THE DEFECT. THIS
IS BECAUSE FEMCOR INCLUDED 2,373 HOURS OF OVERTIME WORK IN ITS PROPOSAL,
ALL LABELED AS EMERGENCY WORK, AND THE PROPOSAL CONTAINED NO ADDITIONAL
COSTS FOR REQUIRED (AFTER-HOURS) WORK.
WE AGREE WITH FEMCOR THAT THE RFP WAS UNCLEAR REGARDING THE FACT THAT
BOTH REQUIRED (AFTER-HOURS) WORK AND EMERGENCY WORK WERE INCLUDED IN THE
QUANTITY ESTIMATE OF 2,373 HOURS OF REQUIRED (AFTER-HOURS) EMERGENCY
WORK. NEVERTHELESS, WE ALSO AGREE WITH THE ARMY THAT FEMCOR WAS NOT
PREJUDICED BY THIS. THE PROTESTER ONLY INCLUDED A TOTAL OF 2,373 OF
HOURS OF OVERTIME IN ITS PROPOSAL. WHILE FEMCOR APPARENTLY BELIEVED
THAT IT WAS PROPOSING TO PERFORM ONLY EMERGENCY OVERTIME WORK, IT HAS
NOT ALLEGED THAT ITS PRICE WOULD HAVE BEEN LOWER HAD IT KNOWN OTHERWISE.
MOREOVER, EVEN IF WE ASSUME THAT FEMCOR WOULD HAVE ALTERED ITS PRICE
STRUCTURE TO SOME EXTENT, WE HAVE NO BASIS TO CONCLUDE THAT ANY SUCH
CHANGE WOULD HAVE ALTERED THE OUTCOME OF THE COST COMPARISON,
PARTICULARLY IN VIEW OF $152,123 COST ADVANTAGE OF IN-HOUSE PERFORMANCE.
(3) THE PROTESTER CONTENDS THAT WE IMPROPERLY RELIED ON THE ARMY'S
PLAN TO RESTRUCTURE ITS STAFFING AS A BASIS FOR CONCLUDING THAT THE
AGENCY REASONABLY EXCLUDED ANY OVERTIME HOURS FROM ITS IN-HOUSE COST
ESTIMATE. FEMCOR ASSERTS THAT THE REPRESENTATIONS CONCERNING STAFFING
CHANGES CONTAINED IN THE AGENCY REPORT ARE INCONSISTENT WITH THE
STAFFING RECOMMENDED BY THE MANAGEMENT STUDY PERFORMED TO DETERMINE HOW
THE WORK COVERED BY THE RFP WOULD BE ACCOMPLISHED IN-HOUSE. THE
STAFFING IN ISSUE IS AT THE CARPENTER/PAINT SHOP, THE ELECTRONICS SHOP,
AND THE HEAT/CHILL PLANT.
WE STATED IN OUR DECISION THAT THE ARMY ADDED A CARPENTER TO THE
CARPENTER/PAINT SHOP. FEMCOR CONTENDS THAT THE ARMY ONLY INCREASED ITS
AUTHORIZED STAFF LEVEL FROM TWO TO THREE CARPENTERS, BUT NOT THE ACTUAL
NUMBER OF EMPLOYEES. FEMCOR ASSERTS THAT THE ARMY WAS ALREADY OPERATING
OVER ITS AUTHORIZED STAFF LEVEL WITH THREE CARPENTERS AT WORK. THE
PROTESTER ARGUES THAT SINCE THERE WAS NO ACTUAL INCREASE IN STAFF, WE
HAD NO BASIS TO CONCLUDE THAT THE NEED FOR OVERTIME HAD BEEN ELIMINATED
FROM THE CARPENTER/PAINT SHOP.
THE ARMY ACKNOWLEDGES THAT THE ACTUAL LEVEL OF STAFFING IN THE
CARPENTER/PAINT SHOP DID NOT INCREASE. IT ASSERTS, HOWEVER, THAT THE
MANAGEMENT STUDY TEAM RECOMMENDED THAT THE SHOP BE PUT UNDER THE DIRECT
SUPERVISION OF THE GROUNDS & STRUCTURES BRANCH CHIEF. THE AGENCY STATES
THAT PRIOR TO THE STUDY, THERE WAS NO CLOSE SUPERVISION IN THE SHOP, AND
THE MANAGEMENT STUDY TEAM CONCLUDED THAT CLOSER SUPERVISION WOULD
ELIMINATE THE NEED FOR OVERTIME.
ALTHOUGH THIS RATIONALE WAS NOT CONTAINED IN THE AGENCY REPORT ON
FEMCOR'S ORIGINAL PROTEST, WE NORMALLY WILL ACCEPT A SUBSEQUENT
STATEMENT JUSTIFYING AGENCY ACTION IF THE STATEMENT WOULD HAVE SUPPORTED
THE ACTION IF PROVIDED INITIALLY. SEE HUMAN SCIENCES RESEARCH, INC. -
RECONSIDERATION, B-201956, SEPT. 23, 1981, 81-2 CPD PARA. 246. HERE, WE
NOTE THAT THE RATIONALE NOW ADVANCED IS SUPPORTED BY THE MANAGEMENT
STUDY TEAM'S WRITTEN RECOMMENDATIONS, AND WE BELIEVE THAT IT REASONABLY
SUPPORTS THE AGENCY'S EXCLUSION OF OVERTIME COSTS FOR THE
CARPENTER/PAINT SHOP FROM THE IN-HOUSE ESTIMATE. ACCORDINGLY, WE FIND NO
BASIS TO REVERSE OUR PRIOR DECISION IN THIS RESPECT.
FEMCOR ALSO QUESTIONS THE STATEMENT IN OUR DECISION THAT THE ARMY
ADDED AN ELECTRICAL MECHANIC TO THE ELECTRONICS SHOP. THE PROTESTER
ASSERTS THAT THE MANAGEMENT STUDY SHOWS THAT THE STAFF WAS ACTUALLY
REDUCED BY TWO PERSONS, RATHER THAN INCREASED BY ONE.
THE MECHANIC WE REFERRED TO, HOWEVER, WAS NOT AN ADDITION TO THE
STAFF, BUT WAS AN EMPLOYEE PLACED ON THE NIGHT SHIFT TO PERFORM
PREVENTIVE MAINTENANCE THAT COULD NOT BE DONE DURING THE DAY BECAUSE
EQUIPMENT WAS IN USE. THIS WORK PREVIOUSLY HAD BEEN PERFORMED BY
EMPLOYEES WORKING OVERTIME. IN ADDITION, THE ARMY STATES THAT THE
ELECTRONICS SHOP STAFF WAS REDUCED BY ONE PERSON, NOT TWO AS ALLEGED BY
FEMCOR. THE AGENCY STATES THAT THE REDUCED STAFF, INCLUDING ONE
MECHANIC WORKING NIGHT SHIFT, IS ADEQUATE TO ELIMINATE THE NEED FOR
OVERTIME.
WE FIND NOTHING IN THIS INFORMATION THAT WARRANTS REVERSING OUR PRIOR
CONCLUSION THAT THE ARMY REASONABLY EXCLUDED OVERTIME FOR THE
ELECTRONICS SHOP FROM ITS IN-HOUSE COST ESTIMATE. IN OUR DECISION, WE
PRIMARILY RELIED ON THE FACT THAT ONE EMPLOYEE HAD BEEN SCHEDULED TO
WORK NIGHT SHIFT TO PERFORM WORK THAT HAD PREVIOUSLY BEEN DONE ON
OVERTIME. WE ALSO NOTED THAT THE COST OF SHIFT DIFFERENTIAL FOR THE
EMPLOYEE HAD BEEN INCLUDED IN THE GOVERNMENT COST ESTIMATE IN LIEU OF
OVERTIME. WE CONTINUE TO BELIEVE THAT THESE FACTS PROVIDE A REASONABLE
BASIS FOR THE ARMY'S POSITION.
FEMCOR NEXT ARGUES THAT WE ERRED IN CONCLUDING THAT THE ARMY
REASONABLY EXCLUDED ANY OVERTIME FOR THE HEAT/CHILL PLANT, WHERE
OVERTIME HISTORICALLY HAD BEEN REQUIRED. FEMCOR CONTENDS THAT WE
IMPROPERLY ACCEPTED THE ARMY'S POSITION THAT NO ADDITIONAL STAFFING WAS
NECESSARY TO ELIMINATE OVERTIME BECAUSE THE PLANT WAS ALREADY STAFFED
AROUND THE CLOCK. FEMCOR BELIEVES THAT IF THE STAFF COULD NOT OPERATE
THE PLANT WITHOUT OVERTIME IN THE PAST, THE SAME STAFF CANNOT DO SO IN
THE FUTURE.
FEMCOR'S POSITION IGNORES THE RATIONALE ACTUALLY ADVANCED BY THE
ARMY, AND WHICH WE RELIED ON IN OUR DECISION, THAT IMPROVED MAINTENANCE
PROCEDURES AND MORE EFFICIENT SCHEDULING WOULD ELIMINATE THE NEED FOR
OVERTIME. FEMCOR HAS PRESENTED NO REASONS WHY THESE ACTIONS WILL NOT
PROVE EFFECTIVE, AND THEREFORE WE FIND NO MERIT TO ITS RECONSIDERATION
REQUEST ON THIS ISSUE.
(4) IN SUPPORT OF ITS GENERAL ASSERTION THAT THE ARMY ERRED BY NOT
INCLUDING ANY OVERTIME COSTS IN ITS IN-HOUSE ESTIMATE, FEMCOR HAS
SUBMITTED INFORMATION OBTAINED FROM THE ARMY UNDER THE FREEDOM OF
INFORMATION ACT. THIS INFORMATION SHOWS THAT OVER A 7-MONTH PERIOD,
AFTER FEMCOR FILED ITS PROTEST HERE, 6,019 HOURS OF OVERTIME WORK WERE
ACTUALLY PERFORMED IN THE FACILITIES ENGINEERING ELEMENT OF THE HARRY
DIAMOND LABORATORIES.
THE ARMY POINTS OUT, HOWEVER, THAT THE 6,019 HOUR FIGURE REPRESENTS
OVERTIME FOR THE ENTIRE FACILITIES ENGINEERING OFFICE, INCLUDING
FUNCTIONS THAT WERE NOT COVERED BY THE A-76 COST COMPARISON.
SPECIFICALLY, THE AGENCY STATES THAT THE CUSTODIAL SHOP AND THE ROADS
AND GROUND SHOP WERE NOT INCLUDED IN THOSE ACTIVITIES COVERED BY THE
COST COMPARISON, BUT ACCOUNTED FOR MUCH OF THE 6,019 HOURS OF OVERTIME.
MOREOVER, THE ARMY NOTES THAT THE 7-MONTH PERIOD CITED BY FEMCOR RUNS
FROM MARCH 1, 1983 THROUGH SEPTEMBER 30, 1983. DURING THAT PERIOD, THE
SHOPS THAT WERE INCLUDED IN THE COST COMPARISON WERE NOT OPERATING UNDER
THE "MOST EFFICIENT ORGANIZATION" RECOMMENDED BY THE MANAGEMENT STUDY
TEAM. IN FACT, PERMISSION TO CANCEL THE RFP FOR THE SERVICES WAS NOT
RECEIVED UNTIL OCTOBER OF 1983 (SHORTLY AFTER OUR ORIGINAL DECISION WAS
ISSUED). CONSEQUENTLY, THE ORGANIZATION RECOMMENDED BY THE MANAGEMENT
STUDY TEAM, AND THE ONE ON WHICH THE COST COMPARISON WAS BASED, WAS NOT
IN PLACE UNTIL MARCH OF 1984.
IT IS APPARENT THAT THE INFORMATION FEMCOR RELIES ON DOES NOT SUPPORT
ITS ASSERTION THAT THE ARMY IMPROPERLY EXCLUDED OVERTIME FROM THE
IN-HOUSE ESTIMATE. THE CITED 6,019 HOURS OF OVERTIME INCLUDED FUNCTIONS
NOT INCLUDED IN THE COST COMPARISON, AND COVERS A PERIOD BEFORE THE ARMY
IMPLEMENTED THE ORGANIZATIONAL STRUCTURE ON WHICH THE COST COMPARISON
WAS BASED. ACCORDINGLY, WE FIND NO MERIT TO FEMCOR'S CONTENTION IN THIS
REGARD.
FOR THE REASONS STATED ABOVE, OUR PRIOR DECISION IS AFFIRMED.
B-210376, SEP 27, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST THAT CONTRACTING AGENCY UNDERESTIMATED
THE COST OF IN-HOUSE PERFORMANCE AND
OVERESTIMATED THE COST OF CONTRACTING IS
DENIED WHERE PROTESTER HAS NOT SHOWN THAT THE
COST COMPARISON WAS INACCURATE OR VIOLATED
OMB CIRCULAR NO. A-76 AND OTHER APPLICABLE
GUIDANCE.
FACILITIES ENGINEERING & MAINTENANCE CORPORATION:
FACILITIES ENGINEERING & MAINTENANCE CORPORATION (FEMCOR) PROTESTS
THE DEPARTMENT OF THE ARMY'S DECISION TO CANCEL REQUEST FOR PROPOSALS
(RFP) NO. DAAK21-82-R-9495 FOR THE OPERATION AND MAINTENANCE OF THE
UTILITY SYSTEMS, AND THE MAINTENANCE OF PLANT EQUIPMENT, BUILDINGS AND
GROUNDS AT THE HARRY DIAMOND LABORATORIES IN ADELPHI, MARYLAND. WE DENY
THE PROTEST AND THE ATTENDANT CLAIM FOR PROPOSAL PREPARATION COSTS.
THE RFP WAS ISSUED AS PART OF A COST COMPARISON TO DETERMINE WHETHER
IT WOULD BE MORE ECONOMICAL TO CONTRACT FOR THE SERVICES OR TO CONTINUE
TO HAVE THE SERVICES PERFORMED WITH IN-HOUSE PERSONNEL. THE ARMY FOUND
FEMCOR'S PROPOSAL TO BE THE MORE ADVANTAGEOUS TO THE GOVERNMENT OF THE
TWO OFFERS RECEIVED IN RESPONSE TO THE SOLICITATION. THE ARMY CANCELED
THE SOLICITATION, HOWEVER, AFTER DETERMINING THAT THE WORK COULD BE
PERFORMED BY FEMCOR AT A TOTAL COST OF $7,893,260 AND THROUGH CONTINUED
USE OF GOVERNMENT PERSONNEL AT A TOTAL COST OF $7,416,125.
FEMCOR FILED A TIMELY ADMINISTRATIVE APPEAL OF THE ARMY'S DECISION.
THE APPEALS BOARD FOUND ERRORS IN THE COMPARISON, AND CONSEQUENT
ADJUSTMENTS REDUCED THE ESTIMATED ADVANTAGE OF IN-HOUSE PERFORMANCE FOR
THE 5-YEAR CONTRACT PERIOD FROM $477,135 TO $152,123. SINCE IN-HOUSE
PERFORMANCE REMAINED THE LOWER-COST ALTERNATIVE, THE ARMY DENIED THE
APPEAL.
FEMCOR NOW CONTENDS THAT DESPITE THE ADJUSTMENTS THE ARMY MADE AS A
RESULT OF THE APPEAL, THE COST COMPARISON REMAINS INACCURATE AND
INCONSISTENT WITH OFFICE OF MANAGEMENT AND BUDGET (OMB) CIRCULAR NO.
A-76 POLICY AND PROCEDURES. FEMCOR ARGUES THAT THE ARMY UNDERSTATED THE
COST OF IN-HOUSE PERFORMANCE BY OMITTING THE COST OF ANTICIPATED
OVERTIME HOURS, BY OMITTING CERTAIN OVERHEAD COSTS, AND BY FAILING TO
APPLY AN INFLATION FACTOR TO CERTAIN LABOR COSTS. FEMCOR ALSO ASSERTS
THAT THE ARMY OVERESTIMATED THE COST OF CONTRACTING BY INCLUDING AN
IMPROPER AMOUNT OF COSTS RELATING TO SEVERANCE PAY AND RETENTION PAY AND
BY INCLUDING TRANSITION COSTS THAT WILL BE INCURRED IN THE MONTH BEFORE
THE CONTRACT PERIOD. FEMCOR CONTENDS THAT IT IS ENTITLED TO CONTRACT
AWARD OR PROPOSAL PREPARATION COSTS.
OUR REVIEW OF A PROTEST OF AN AGENCY DECISION TO PERFORM SERVICES
IN-HOUSE RATHER THAN ENTER A CONTRACT FOR THE SERVICES GENERALLY IS
LIMITED TO THE CONSIDERATION OF ALLEGATIONS THAT THE AGENCY CONDUCTED A
FAULTY OR MISLEADING COST COMPARISON. SERV-AIR, INC.; AVCO, 60 COMP.
GEN. 44 (1980), 80-2 CPD 317. IN THE COURSE OF OUR REVIEW WE WILL ONLY
QUESTION WHETHER MANDATED PROCEDURES WERE FOLLOWED, AND NOT THE
PROCEDURES THEMSELVES, SINCE THE PROCEDURES ARE MATTERS OF POLICY WITHIN
THE PROVINCE OF THE EXECUTIVE BRANCH. MIDLAND MAINTENANCE, INC.,
B-202977.2, FEBRUARY 22, 1982, 82-1 CPD 150. WE HAVE CAREFULLY EXAMINED
THE ARMY'S COST COMPARISON AND EACH OF FEMCOR'S CONTENTIONS, AND WE
CONCLUDE THE COMPARISON WAS NOT FAULTY OR MISLEADING AND THE ARMY DID
FOLLOW MANDATED PROCEDURES.
OVERTIME LABOR COSTS
FEMCOR COMPLAINS THAT THE ARMY FAILED TO INCLUDE THE COST OF
ANTICIPATED EMERGENCY OVERTIME HOURS OF LABOR IN THE IN-HOUSE
CALCULATION. THE RFP REQUIRES THE CONTRACTOR TO HAVE QUALIFIED
PERSONNEL AVAILABLE ON CALL 24 HOURS PER DAY FOR AFTER-HOURS EMERGENCY
WORK, AND ESTIMATES, BASED ON HISTORICAL DATA, THAT 2,373 HOURS OF
AFTER-HOURS EMERGENCY WORK WILL BE REQUIRED ANNUALLY. FEMCOR BASED ITS
PRICE ON 2,373 OVERTIME HOURS AND CONTENDS THAT THE ARMY ALSO SHOULD
HAVE INCLUDED THE COST OF 2,373 OVERTIME HOURS IN THE IN-HOUSE ESTIMATE.
FEMCOR ASSERTS THAT BY FAILING TO DO SO, THE ARMY HELD FEMCOR TO A
BROADER SCOPE OF WORK THAN THE GOVERNMENT REQUIRES OF ITSELF. THE
DEPARTMENT OF DEFENSE COST COMPARISON HANDBOOK REQUIRES THAT BOTH
GOVERNMENT AND CONTRACTOR COST FIGURES BE BASED ON THE SAME SCOPE OF
WORK. HANDBOOK, CH. II, PARA. C.
THE RECORD INDICATES THAT THE ARMY HAS TAKEN SEVERAL STEPS TO
ELIMINATE THE OVERTIME COSTS IT HAS EXPERIENCED IN THE PAST.
APPROXIMATELY 400 OF THE PAST EMERGENCY OVERTIME HOURS WERE EXPERIENCED
IN THE CARPENTER/PAINT SHOP AS A RESULT OF BACKLOGS. TO ALLEVIATE THE
PROBLEM, THE ARMY ADDED ANOTHER CARPENTER TO THE SHOP AND INCLUDED THE
EXTRA CARPENTER'S SALARY IN THE IN-HOUSE ESTIMATE. THE ARMY ANTICIPATES
THAT NO CARPENTER/PAINT SHOP OVERTIME WILL BE NECESSARY IN THE FUTURE.
MORE THAN 700 OF THE PAST OVERTIME HOURS WERE ATTRIBUTABLE TO THE
ELECTRONICS SHOP. ACCORDING TO THE ARMY, THOSE OVERTIME HOURS WERE FOR
PREVENTIVE MAINTENANCE WHICH HAD TO BE PERFORMED AFTER REGULAR HOURS
BECAUSE THE ELECTRICAL EQUIPMENT WAS IN USE DURING THE DAY. TO PERFORM
THE WORK MORE EFFICIENTLY, THE ARMY SCHEDULED EMPLOYEES TO WORK NIGHT
SHIFTS. THIS SHIFT DIFFERENTIAL, RATHER THAN OVERTIME, WAS INCLUDED IN
THE IN-HOUSE ESTIMATE. THE ARMY ALSO ADDED AN ELECTRICAL MECHANIC WHOSE
SALARY, INCLUDING SHIFT DIFFERENTIAL, WAS INCLUDED IN THE IN-HOUSE
ESTIMATE.
THE REMAINING HOURS OF OVERTIME HISTORICALLY HAVE BEEN IN THE HEAT/
CHILL PLANT, WHICH OPERATES THREE SHIFTS, SO THAT MAINTENANCE PERSONNEL
CONSTANTLY ARE PRESENT. THE ARMY REPORTS THAT IT HAS IMPROVED ITS
MAINTENANCE PROCEDURES AND DESIGNED MORE EFFICIENT SCHEDULES TO
ELIMINATE THE NECESSITY OF OVERTIME IN THIS SHOP.
IN EFFECT, THE ARMY BELIEVES THAT IT WILL BE ABLE TO ELIMINATE
OVERTIME HOURS IN THE FUTURE BUT THAT FEMCOR, DUE TO STAFF LIMITATIONS,
WILL NOT BE ABLE TO AVOID THE OVERTIME IN PERFORMING THE SAME TASKS.
THIS POSITION IS REASONABLE ON ITS FACE. ALTHOUGH FEMCOR DISAGREES WITH
THE ARMY THAT GOVERNMENT OVERTIME COSTS CAN BE ELIMINATED THROUGH
STAFFING AND OTHER CHANGES, FEMCOR HAS NOT PRESENTED ANY SPECIFIC
REASONS WHY THE ARMY'S ACTIONS WILL NOT HAVE THEIR INTENDED EFFECT.
MOREOVER, THE ARMY INCLUDED IN THE IN-HOUSE ESTIMATE THE EXTRA COSTS
(SALARY AND SHIFT DIFFERENTIAL) INCURRED TO LIMIT OVERTIME.
LAST, WE POINT OUT THAT THE ARMY DID NOT COMPARE UNEQUAL SCOPES OF
WORK AS FEMCOR ALLEGES, BUT INSTEAD ASSUMED THAT THE GOVERNMENT, WITH A
LARGER STAFF AND GREATER RESOURCES DEDICATED TO THE TASK, COULD PERFORM
THE WORK SPECIFIED IN THE RFP WITHOUT RESORT TO OVERTIME. THIS OFFICE
HAS RECOGNIZED THAT THE GOVERNMENT MAY HAVE INHERENT ADVANTAGES IN
ORGANIZING ITS MANPOWER THAT A CONTRACTOR CANNOT ACHIEVE IN AN A-76
EXERCISE. TECHNICOLOR GRAPHIC SERVICES, INC., B-205242, MAY 24, 1982,
82-1 CPD 486. THE FACT THAT THE ARMY RELIED ON THOSE ADVANTAGES IN
ESTIMATING ITS COSTS DOES NOT INVALIDATE THE COST COMPARISON.
WE FIND THAT THE ARMY'S TREATMENT OF OVERTIME COSTS WAS REASONABLE
AND CONSISTENT WITH APPLICABLE GUIDANCE.
OVERHEAD COSTS
FEMCOR CONTENDS THAT THE ARMY OMITTED OPERATIONS OVERHEAD COSTS FROM
THE COST OF IN-HOUSE PERFORMANCE. OPERATIONS OVERHEAD COSTS ARE THE
INDIRECT COSTS THAT ARE NECESSARILY INCURRED TO DELIVER THE PARTICULAR
SERVICES IN QUESTION, AND WHICH THEREFORE MUST BE INCLUDED IN THE
IN-HOUSE ESTIMATE. HANDBOOK, CH. III, PARA. D.2.
FEMCOR COMPLAINS THAT THE FOLLOWING WORK CENTER POSITIONS PROVIDE
SUPERVISORY AND ADMINISTRATIVE SUPPORT FOR THE FACILITIES ENGINEERING
FUNCTION, BUT WERE NOT INCLUDED IN THE IN-HOUSE ESTIMATE:
--FACILITIES ENGINEER CHIEF
--INDUSTRIAL ENGINEER
--ADMINISTRATIVE OFFICER
--SECRETARY
--ENVIRONMENTAL AND ENERGY CHIEF
--GENERAL ENGINEER
--ENGINEER TECHNICIAN.
IN FEMCOR'S ESTIMATION, 25 PERCENT OF EACH EMPLOYEE'S TIME IS SPENT ON
ACTIVITIES THAT WOULD BE ASSUMED BY THE CONTRACTOR, AND THEREFORE 25
PERCENT OF THE EMPLOYEES' SALARIES AND FRINGE BENEFITS SHOULD HAVE BEEN
INCLUDED IN THE IN-HOUSE ESTIMATE AS OPERATIONS OVERHEAD.
THE ARMY DETERMINED THAT ALTHOUGH THE ACTIVITIES OF THESE EMPLOYEES
WOULD DIMINISH SOMEWHAT AS A RESULT OF CONTRACTING, NONE OF THE
POSITIONS COULD BE ELIMINATED. IN THIS REGARD, UNDER AN ALTERNATE COST
COMPARISON METHOD AUTHORIZED BY A MEMORANDUM OF THE ASSISTANT SECRETARY
OF DEFENSE (DATED MARCH 23, 1982), COSTS THAT WILL CONTINUE TO EXIST
WHETHER THE ACTIVITY IS PERFORMED IN-HOUSE OR BY CONTRACT NEED NOT BE
CONSIDERED. ADDITIONALLY, THE MEMORANDUM DIRECTS THAT "ONLY WHOLE
MANYEARS NEEDED TO SUPPORT THE ACTIVITY UNDER STUDY" ARE TO BE INCLUDED
IN OPERATIONS OVERHEAD EXPENSE OR GENERAL AND ADMINISTRATIVE EXPENSE;
"PARTIAL MANYEARS ARE EXCLUDED BECAUSE THEY WOULD CONTINUE TO EXIST FOR
EITHER IN-HOUSE OR CONTRACT PERFORMANCE."
FEMCOR ARGUES THAT THE ARMY HAS MISINTERPRETED THE "WHOLE MANYEAR
RULE" IN THAT THE RULE SHOULD NOT BE APPLIED TO EACH POSITION ON AN
INDIVIDUAL BASIS, BUT RATHER TO ALL POSITIONS ON A COLLECTIVE BASIS.
FEMCOR ASSERTS THAT IF 25 PERCENT OF THE COMBINED FUNCTIONS OF THE SEVEN
POSITIONS CAN BE ELIMINATED BY CONTRACTING OUT, ONE OR TWO OF THE
POSITIONS SHOULD BE ELIMINATED; TO RETAIN ALL SEVEN EMPLOYEES WITH ONLY
A 75 PERCENT WORKLOAD WOULD BE INEFFICIENT AND WOULD VIOLATE PERSONNEL
REGULATIONS. IN FEMCOR'S VIEW, THE ARMY SHOULD HAVE INCLUDED THE COST
OF ONE OR TWO POSITIONS (25 PERCENT OF 7) IN THE IN-HOUSE COMPUTATION AS
OPERATIONS OVERHEAD.
FEMCOR'S POSITION IS CLEARLY WITHOUT MERIT. THE ASSISTANT SECRETARY
OF DEFENSE MEMORANDUM UNAMBIGUOUSLY DIRECTS THAT COSTS THAT WILL
CONTINUE TO EXIST WHETHER OR NOT A CONTRACT IS AWARDED NEED NOT BE
CONSIDERED. THE ARMY HAS PROVIDED DOCUMENTATION WHICH DEMONSTRATES THAT
NO ONE POSITION CAN BE ELIMINATED IF A 25 PERCENT ACROSS-THE-BOARD
REDUCTION IN ACTIVITY OCCURS. FEMCOR HAS NOT REBUTTED THIS POSITION.
WE CONCLUDE THAT FEMCOR HAS NOT PROVIDED A BASIS FOR US TO QUESTION THE
OMISSION OF THE COSTS. SEE CONTRACT SERVICES COMPANY, INC., B-210756,
AUGUST 29, 1983, 83-2 CPD .
INFLATION FACTOR
THE HANDBOOK REQUIRES THAT A PRESCRIBED INFLATION FACTOR BE APPLIED
TO THE SALARY OF GOVERNMENT EMPLOYEES TO ACCOUNT FOR SALARY INCREASES
AFTER THE FIRST YEAR OF OPERATION. HANDBOOK, CH. III, PARA. H. THE
DEPARTMENT OF DEFENSE'S APPENDIX 4 TO THE HANDBOOK STATES THAT THE
INFLATION FACTOR IS NOT TO BE APPLIED TO POSITIONS THAT WOULD BE SUBJECT
TO THE SERVICE CONTRACT ACT, 41 U.S.C. SECS. 351 ET SEQ. (1976), IF THE
SERVICES WERE PROVIDED BY CONTRACT. FEMCOR ALLEGES THAT THE ARMY
IMPROPERLY TREATED TWO POSITIONS, "SECRETARY TYPIST" AND "PHYSICAL
SCIENCE TECHNICIAN," AS WITHIN THE SCOPE OF THE SERVICE CONTRACT ACT AND
THUS NOT SUBJECT TO THE INFLATION FACTOR.
THE DETERMINATION WHETHER A PROPOSED CONTRACT IS SUBJECT TO THE
SERVICE CONTRACT ACT IS FOR THE CONTRACTING AGENCY AND IT WILL NOT BE
QUESTIONED BY OUR OFFICE UNLESS SHOWN TO BE UNREASONABLE. NONPUBLIC
EDUCATIONAL SERVICES, INC., B-207306.2, OCTOBER 20, 1982, 82-2 CPD 348.
THE ARMY'S DETERMINATION THAT THE POSITIONS ARE SUBJECT TO THE ACT IS
BASED ON A DETAILED LEGAL ANALYSIS AND FEMCOR, DESPITE SEVERAL
OPPORTUNITIES TO DO SO, HAS NOT EXPLAINED WHY IT BELIEVES THAT THE
POSITIONS ARE EXEMPT; RATHER, IT MERELY MAKES A BARE ASSERTION THAT THE
POSITIONS ARE EXEMPT. THIS MERE DISAGREEMENT WITH THE ARMY'S
WELL-SUPPORTED POSITION DOES NOT MEET THE PROTESTER'S BURDEN TO PROVE
ITS CASE. SEE MAR, INCORPORATED, B-205635, SEPTEMBER 27, 1982, 82-2 CPD
278. THUS, WE FIND THAT THE ARMY PROPERLY REGARDED THE POSITIONS AS
SUBJECT TO THE SERVICE CONTRACT ACT AND THUS NOT SUBJECT TO THE
INFLATION FACTOR.
TRANSITION COSTS
THE RFP REQUIRES THAT THE CONTRACTOR'S PERSONNEL "BE ON BOARD" 1
MONTH BEFORE PERFORMANCE. THE CONTRACTOR IS TO INCLUDE ITS PRICE FOR
THIS TRANSITION PERIOD AS A SEPARATE LINE ITEM IN ITS COST PROPOSAL.
FEMCOR'S PROPOSAL CONTAINS A PRICE OF $42,644.76 FOR THE TRANSITION
PERIOD, WHICH THE ARMY INCLUDED AS A COST OF CONTRACTING.
FEMCOR ASSERTS THAT BY INCLUDING THE TRANSITION COSTS, THE ARMY IN
EFFECT COMPARED THE COST OF THE CONTRACTOR PERFORMING FOR 61 MONTHS (A
60-MONTH CONTRACT PERIOD PLUS A TRANSITION PERIOD OF 1 MONTH) TO THE
COST OF IN-HOUSE PERFORMANCE FOR 60 MONTHS, CONTRAVENING THE REQUIREMENT
IN THE HANDBOOK THAT BOTH GOVERNMENT AND COMMERCIAL COST FIGURES BE
BASED ON THE SAME SCOPE OF WORK. IN FEMCOR'S VIEW, ANY TRANSITION COSTS
ASSOCIATED WITH CONTRACTING ARE ALREADY INCLUDED IN THE 10 PERCENT
PERSONNEL COST MARGIN THAT IS ADDED TO THE TOTAL COST OF CONTRACTING,
WHICH IS DESIGNED TO REFLECT THE INTANGIBLE COST OF THE CONVERSION.
OMB CIRCULAR A-76 DIRECTS THAT ANY COSTS DIRECTLY RELATING TO THE
CONTRACTING OF A FUNCTION BE ADDED TO THE CONTRACTOR SIDE OF THE COST
COMPARISON FORM. MORE SPECIFICALLY, AN IMPLEMENTING ARMY DIRECTIVE
STATES THAT:
"WHEN PROVISIONS IN THE CONTRACT SOLICITATION
PACKAGE CALL FOR A SEPARATELY PRICED CONTRACTOR
STARTUP OR PHASE-IN PERIOD, THIS
PRICE WILL BE ADDED TO THE CONTRACTOR'S BID
PRICE FOR THE FIRST YEAR OF OPERATION ***."
CLEARLY, THE INCLUSION OF FEMCOR'S TRANSITION PRICE IS CONSISTENT WITH
APPLICABLE GUIDANCE. MOREOVER, CONTRARY TO FEMCOR'S ASSERTION, THE
INCLUSION OF TRANSITION COSTS IN THE CONTRACT COST DOES NOT RESULT IN A
COMPARISON OF UNEQUAL SCOPES OF WORK. DURING THE MONTH BEFORE THE
INCEPTION OF CONTRACT PERFORMANCE, THE GOVERNMENT IS EXCLUSIVELY
RESPONSIBLE FOR PERFORMING THE SERVICES IN QUESTION AND WILL BEAR ALL
THE COSTS OF SUCH PERFORMANCE. CONTRACTOR PERSONNEL ARE REQUIRED TO BE
ON BOARD ONLY TO RECEIVE TRAINING AND FAMILIARIZE THEMSELVES WITH
OPERATIONS, NOT TO PERFORM THE OPERATIONS. THUS, THE CONTRACTOR'S
PARTICIPATION DURING THAT MONTH RELATES ONLY TO THE PERFORMANCE OF THE
60-MONTH CONTRACT PERIOD, AND HAS NOTHING TO DO WITH THE PERFORMANCE OF
ACTUAL OPERATIONS THE MONTH BEFORE THE CONTRACT PERIOD. THE ARMY WILL,
UNDER THE TERMS OF THE CONTRACT, COMPENSATE FEMCOR $42,644.76 FOR ITS
TRANSITION PERIOD COSTS. CLEARLY, THIS AMOUNT IS AN ADDITIONAL
CONTRACTUAL COST OF HAVING THE SERVICE PERFORMED FOR 60 MONTHS BY A
PRIVATE FIRM AND, LOGICALLY, THIS COST MUST BE ADDED TO THE CONTRACTOR
SIDE OF THE EQUATION IN COMPARING THE COST OF IN-HOUSE AND CONTRACT
PERFORMANCE.
IT IS ALSO CLEAR THAT TRANSITION COSTS ARE NOT INCLUDED IN THE 10
PERCENT ADJUSTMENT TO WHICH FEMCOR REFERS. THE HANDBOOK DIRECTS THAT A
COST MARGIN EQUAL TO 10 PERCENT OF "IN-HOUSE PERSONNEL-RELATED COSTS" BE
ADDED TO THE COST OF CONTRACTING. THERE IS NO INDICATION THAT THE
ADJUSTMENT WAS INTENDED TO ACCOUNT FOR COSTS SUCH AS TRANSITION COSTS.
RATHER THE PURPOSE OF THE ADJUSTMENT IS TO RECOGNIZE CERTAIN
UNQUANTIFIABLE COSTS OF CONTRACTING, SUCH AS:
"*** THE LOSS OF PRODUCTION, THE TEMPORARY
DECREASE IN EFFICIENCY AND EFFECTIVENESS AND
OTHER UNPREDICTABLE RISKS THAT RESULT ANY
TIME A CHANGE IS MADE IN THE METHOD OF
OPERATION FROM IN-HOUSE TO CONTRACT. THE
ADJUSTMENT ALSO TAKES INTO CONSIDERATION THE
PERSONNEL TURBULENCE THAT RESULTS FROM SUCH A
CHANGE." HANDBOOK, CH. VI, PARA. B.1.
FEMCOR ALTERNATIVELY CHALLENGES THE INCLUSION OF THE $42,644.76 ON
THE BASIS THAT EVEN IF TRANSITION COSTS MAY BE CONSIDERED IN THE COST
COMPARISON, A FULLY STAFFED TRANSITION PERIOD OF 30 DAYS IS NOT
JUSTIFIABLE. FEMCOR BELIEVES THAT A MORE REASONABLE TRANSITION PERIOD
WOULD HAVE BEEN 2 OR 3 DAYS. THIS ALLEGATION, HOWEVER, IS UNTIMELY
RAISED SINCE THE RFP UNAMBIGUOUSLY SPECIFIED A TRANSITION PERIOD OF 30
DAYS, AND FEMCOR FORMULATED ITS PROPOSAL ON THIS BASIS. OUR BID PROTEST
PROCEDURES REQUIRE PROTESTS BASED ON APPARENT SOLICITATION IMPROPRIETIES
TO BE FILED PRIOR TO THE CLOSING DATE FOR RECEIPT OF INITIAL PROPOSALS.
4 C.F.R. SEC. 21.2(B)(1) (1983). THUS, FEMCOR SHOULD HAVE QUESTIONED
THE LENGTH OF THE PERIOD BEFORE THE CLOSING DATE RATHER THAN NEARLY 3
MONTHS LATER, WHEN THE FIRM FILED ITS ADMINISTRATIVE APPEAL.
SEVERANCE AND RETENTION PAY
FEMCOR QUESTIONS THE ARMY'S ESTIMATE OF THE AMOUNT OF SEVERANCE PAY
AND RETENTION PAY THE GOVERNMENT WOULD BE OBLIGATED TO PAY IN THE EVENT
OF CONVERSION FROM IN-HOUSE TO CONTRACT PERFORMANCE. SEVERANCE AND
RETENTION PAY IS PROVIDED TO GOVERNMENT EMPLOYEES WHO ARE, RESPECTIVELY,
TERMINATED FROM GOVERNMENT EMPLOYMENT OR TRANSFERRED TO A LOWER-GRADE
POSITION AS A RESULT OF A REDUCTION IN FORCE.
THE RECORD INDICATES THAT 19 EMPLOYEES WHO WOULD BE ADVERSELY
AFFECTED BY A CONVERSION WERE ELIGIBLE FOR RETIREMENT AT THE TIME OF THE
COST ANALYSIS. IN FORMULATING THE INITIAL COST COMPARISON THE ARMY
ESTIMATED THAT NONE OF THESE EMPLOYEES WOULD OPT TO RETIRE EVEN IF A
CONTRACT WERE AWARDED AND THEIR POSITIONS ELIMINATED. THE ARMY ADDED
EITHER SEVERANCE OR RETENTION PAY COSTS FOR EACH OF THE 19 EMPLOYEES TO
THE COST OF CONTRACTING.
IN ITS ADMINISTRATIVE APPEAL, FEMCOR CONTESTED THE ASSUMPTION THAT NO
ELIGIBLE EMPLOYEES WOULD RETIRE AS UNREASONABLE AND INCONSISTENT WITH
THE A-76 GUIDELINES. THE APPEALS BOARD AGREED WITH FEMCOR ON THIS POINT.
THE BOARD NOTED THAT THE NORMAL RETIREMENT RATE AT THE INSTALLATION IS
5 PERCENT PER YEAR AND DETERMINED THAT THE INSTALLATION COULD REASONABLY
EXPECT THAT 10 PERCENT (7 EMPLOYEES) OF THE PERMANENT ADVERSELY AFFECTED
WORK FORCE (65 EMPLOYEES) WOULD RETIRE. THE SEVERANCE AND RETENTION PAY
FIGURES WERE ADJUSTED TO REFLECT THE RETIREMENTS ANTICIPATED BY THE
APPEALS BOARD.
FEMCOR NOW CONTENDS THAT APPLICABLE GUIDANCE REQUIRES THE COST
COMPARISON TO BE FORMULATED ON THE ASSUMPTION THAT ALL ELIGIBLE
EMPLOYEES WILL RETIRE.
THE HANDBOOK PROVIDES ONLY THAT THE FIRST STEP OF DETERMINING
LABOR-RELATED CONVERSION COSTS IS TO "ESTIMATE THE NUMBER OF PERSONNEL
WHO WILL VOLUNTARILY RESIGN OR RETIRE FROM GOVERNMENT EMPLOYMENT."
HANDBOOK CH. V, PARA. E.4.C., AS AMENDED BY OMB CIRCULAR A-76
TRANSMITTAL MEMORANDUM NO. 6, JANUARY 26, 1982. THE ESTIMATE IS TO BE
BASED ON CONSULTATION WITH MANAGEMENT AND THE PERSONNEL DEPARTMENT, AND
HISTORICAL DATA FROM THE AGENCY OR OTHER AGENCIES. CONSISTENT WITH THIS
GUIDANCE, THE BOARD, IN MAKING ITS ESTIMATE, USED HISTORICAL DATA FROM
THE INSTALLATION, INFORMAL ADVICE FROM ANOTHER INSTALLATION WHICH HAD
MORE EXPERIENCE IN CONVERSIONS, OPINIONS OF PERSONNEL SPECIALISTS AND
INFORMATION CONCERNING THE CURRENT WORK FORCE AND GENERAL ECONOMIC
CONDITIONS.
IN OUR VIEW, ESTIMATES OF THIS KIND INVOLVE COMPLEX AND SOMEWHAT
SUBJECTIVE JUDGMENTS, WHICH WE ARE NOT IN A POSITION TO SECOND-GUESS.
IN THIS CASE, FEMCOR HAS SIMPLY MANIFEST DISAGREEMENT WITH THE ARMY'S
JUDGMENT. THIS MERE DISAGREEMENT SIMPLY DOES NOT MEET THE PROTESTER'S
BURDEN TO PROVE ITS CASE. SEE MAR, INCORPORATED, SUPRA.
FEMCOR FURTHER QUESTIONS THE SEVERANCE AND RETENTION PAY CALCULATIONS
ON THE BASIS THAT THE ARMY ASSUMED TOO FEW CURRENT EMPLOYEES WOULD
ACCEPT EMPLOYMENT WITH FEMCOR IN THE EVENT OF CONVERSION. IN THE
INITIAL COST COMPARISON, THE ARMY ASSUMED THAT NO MEMBER OF THE CURRENT
WORK FORCE WOULD ACCEPT EMPLOYMENT WITH FEMCOR. THE APPEALS BOARD FOUND
THIS ASSUMPTION TO BE UNSUPPORTED AND ESTIMATED THAT 9 OF THE 47
QUALIFIED EMPLOYEES (20 PERCENT) WOULD ACCEPT EMPLOYMENT WITH FEMCOR.
FEMCOR BELIEVES THAT THIS ESTIMATE IS UNSUPPORTED AND UNREASONABLE.
FEMCOR ARGUES THAT FEW SKILLED EMPLOYEES WOULD ACCEPT A DOWNGRADED
NONSKILLED POSITION AT THE CURRENT PAY LEVEL OR A TERMINATION RATHER
THAN CONTINUE TO PERFORM THEIR SKILLED TASK AT THE SLIGHTLY LOWER WAGE
AND BENEFIT LEVEL OFFERED BY FEMCOR. FEMCOR ALLEGES THAT, BASED ON ITS
TRADE PRACTICES AND EXPERIENCE, 50 PERCENT OF THE AFFECTED EMPLOYEES
WOULD BECOME EMPLOYED BY FEMCOR. THE PROTESTER CITES AS AN EXAMPLE A
RECENT CONVERSION AT FORT GORDON, GEORGIA, IN WHICH 53 PERCENT OF THE
WORK FORCE ACCEPTED EMPLOYMENT WITH THE CONTRACTOR.
THE RECORD INDICATES THAT, DUE TO THE LACK OF RELEVANT HISTORICAL
DATA AT THE INSTALLATION, THE APPEALS BOARD REQUESTED FROM THE ARMY
STATISTICS UPON WHICH AN ESTIMATE COULD BE BASED. THE ARMY REPORTED
THAT STATISTICS FROM VARIOUS INSTALLATIONS INDICATED THAT BETWEEN 12 AND
60 PERCENT OF THE AFFECTED POPULATION CAN BE EXPECTED TO BECOME EMPLOYED
BY THE CONTRACTOR AND CAUTIONED THAT THERE ARE TOO MANY VARIABLES TO USE
A SPECIFIC PERCENTAGE AS A STANDARD.
AGAIN, WE POINT OUT THAT WE ARE CONSTRAINED TO RECOGNIZE A
CONSIDERABLE DEGREE OF AGENCY DISCRETION IN MAKING JUDGMENTS SUCH AS
THESE. BASED ON THE ARMY STATISTICS, IT WOULD APPEAR THAT THE LEVEL OF
EMPLOYMENT WITH THE NEW CONTRACTOR VARIES GREATLY DEPENDING ON THE
INSTALLATION AND CONTRACTOR INVOLVED. THUS, FEMCOR'S REFERENCE TO FORT
GORDON'S 53 PERCENT RATE DOES NOT DEMONSTRATE THAT THE ESTIMATE OF A 20
PERCENT RATE AT THE HARRY DIAMOND LABORATORIES IS UNREASONABLE. AS THE
ARMY POINTS OUT, THE FORT GORDON CONVERSION INVOLVED 718 EMPLOYEES AT AN
INSTALLATION LOCATED IN AN ISOLATED AREA WITH FEW OTHER GOVERNMENT JOB
OPPORTUNITIES, WHEREAS CONVERSION BEING CONSIDERED HERE INVOLVES FEWER
THAN 50 EMPLOYEES IN THE WASHINGTON, D. C. AREA WITH INNUMERABLE
GOVERNMENT INSTALLATIONS. THE ARMY ALSO POINTS OUT THAT CONTRARY TO
FEMCOR'S ASSERTION, MANY EMPLOYEES WOULD ACCEPT A DOWNGRADED POSITION IN
ORDER TO RETAIN CURRENT PAY AND BENEFITS, PRIORITY PLACEMENT RIGHTS AND
RETIREMENT BENEFITS. UNDER THE CIRCUMSTANCES, WE CANNOT QUESTION THE
ARMY'S POSITION. SEE JETS, INC., 59 COMP.GEN. 263 (1980), 80-1 CPD 152.
LAST, FEMCOR ARGUES THAT THE ARMY ACTED IMPROPERLY BY BASING ITS
SEVERANCE AND RETENTION PAY CALCULATIONS ON THE EMPLOYEES IN THE CURRENT
WORK FORCE WHO WOULD HAVE TO BE TERMINATED OR DOWNGRADED TO REDUCE THE
WORK FORCE TO THE STAFF LEVEL NEEDED IN THE EVENT OF CONVERSION. FEMCOR
ASSERTS THAT USING THE EMPLOYEES IN THE CURRENT WORK FORCE AS A STARTING
POINT ERRONEOUSLY INFLATED THE COSTS CHARGEABLE TO THE CONTRACTOR. IN
FEMCOR'S VIEW, THE ARMY SHOULD HAVE USED AS A STARTING POINT THE
EMPLOYEES IN THE "MOST EFFICIENT ORGANIZATION."
WE NEED NOT CONSIDER THIS CONTENTION. WE HAVE DETERMINED THAT THE
AMOUNT OF SEVERANCE AND RETENTION PAY COSTS ATTRIBUTABLE TO THOSE
EMPLOYEES IN THE CURRENT WORK FORCE WHO, FEMCOR CONTENDS, WOULD NOT BE
IN THE MOST EFFICIENT ORGANIZATION IS INSUFFICIENT TO OVERCOME THE
$152,123 COST ADVANTAGE OF IN-HOUSE PERFORMANCE. FEMCOR ITSELF CONCEDES
THAT THIS ISSUE COULD BE MATERIAL TO THE RESULT OF THE COST ANALYSIS
ONLY IF WE FOUND THAT THE GOVERNMENT COMMITTED OTHER ERRORS. IN VIEW OF
OUR FINDINGS ON THE OTHER MATTERS, EVEN IF WE AGREED WITH THIS
CONTENTION FEMCOR WOULD NOT HAVE ESTABLISHED THAT THE COST ANALYSIS WAS
FAULTY. THEREFORE, WE PERCEIVE NO USEFUL PURPOSE IN CONSIDERING THIS
ISSUE.
IN CONCLUSION, WE FIND THAT THE ARMY'S COST ANALYSIS WAS CONSISTENT
WITH APPLICABLE GUIDANCE. ACCORDINGLY, WE CANNOT FIND THAT FEMCOR HAS
BEEN SUBJECTED TO ARBITRARY OR CAPRICIOUS TREATMENT, A SHOWING OF WHICH
IS A PREREQUISITE TO ENTITLEMENT TO PROPOSAL PREPARATION COSTS, AND
THEREFORE THE PROTESTER IS NOT ENTITLED TO RECOVER SUCH COSTS. SEE D-K
ASSOCIATES, INC., B-206196, JANUARY 18, 1983, 83-1 CPD 55.
THE PROTEST AND CLAIM ARE DENIED.
B-210374, JUL 8, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
EMPLOYEE OF DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT RECLAIMS
TRAVEL EXPENSES DISALLOWED BY AGENCY DUE TO INDIRECT ROUTING IN
CONNECTION WITH OFFICIAL TRAVEL BETWEEN ANCHORAGE, ALASKA, AND
WASHINGTON, D. C., ON SEPTEMBER 27 AND OCTOBER 1, 1982. ALTHOUGH EXPERT
OPINION ESTABLISHES THAT LOWER DIRECT AIRFARES WERE IN EXISTENCE AT THE
TIME TRAVEL WAS PERFORMED, RECORD SUPPORTS FINDING THAT THE PURCHASE
PRICE WAS QUOTED AS THE LOWEST AVAILABLE FARE ON SEPTEMBER 17, 1982,
WHEN EMPLOYEE PURCHASED TICKET FROM A GOVERNMENT-DESIGNATED TRAVEL
VENDOR SERVICE. WHILE THIS QUOTATION WAS IN ERROR, EMPLOYEE SHOULD NOT
BE PENALIZED IN CIRCUMSTANCES DISCUSSED IN THIS CASE.
MARLENE BOBERICK - CONTRACT AIRFARES - GOVERNMENT-DESIGNATED TRAVEL
VENDOR SERVICES:
MS. MARLENE BOBERICK, AN EMPLOYEE OF THE DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT BASED IN ANCHORAGE, ALASKA, RECLAIMS $248.19 IN
OFFICIAL TRAVEL COSTS WHICH WERE DISALLOWED BY THE AGENCY'S SEATTLE
REGIONAL ACCOUNTING OFFICE IN CONNECTION WITH HER ROUND-TRIP TRAVEL FROM
ANCHORAGE TO WASHINGTON, D. C., IN LATE SEPTEMBER AND EARLY OCTOBER
1982. IN ESSENCE THE CERTIFYING OFFICER FOUND THAT IN CONSEQUENCE OF
PERFORMING CERTAIN PERSONAL TRAVEL MS. BOBERICK DID NOT OBTAIN THE
LOWEST AVAILABLE DIRECT AIRFARE AS REQUIRED BY REGULATION. MS. BOBERICK
COUNTERS THAT SHE DID IN FACT OBTAIN THE LOWEST AIRFARE AVAILABLE FOR
HER OFFICIAL TRAVEL ON THE DATE SHE SECURED HER TICKET, AND THAT SHE
FULLY PAID FOR THE INCREASE IN THE COST OF HER TICKET OCCASIONED BY HER
PERSONAL SIDE TRIP.
WE DETERMINE THAT MS. BOBERICK SHOULD NOT BE PENALIZED IN THESE
CIRCUMSTANCES WHERE SHE ACTED IN GOOD FAITH AND IN CONFORMANCE WITH
APPLICABLE REGULATIONS BUT NEVERTHELESS ENCOUNTERED TICKET PRICE
DISCREPANCIES WHEN USING GOVERNMENT-DESIGNATED TRAVEL VENDOR SERVICES.
BACKGROUND
MS. BOBERICK'S OFFICIAL TRAVEL ITINERARY WAS ANCHORAGE TO WASHINGTON,
D. C., VIA NORTHWEST AIRLINES ON SEPTEMBER 27, 1982, AND RETURN FROM
WASHINGTON, D. C., TO ANCHORAGE VIA NORTHWEST AIRLINES ON OCTOBER 1,
1982.
MS. BOBERICK'S ACTUAL ITINERARY INCLUDED ANCHORAGE TO WASHINGTON, D.
C., VIA NORTHWEST ON SEPTEMBER 27, 1982; WASHINGTON TO LOS ANGELES VIA
TWA ON OCTOBER 1, 1982; AND LOS ANGELES TO ANCHORAGE VIA WESTERN
AIRLINES ON OCTOBER 3, 1982.
ON SEPTEMBER 17, 1982, MS. BOBERICK USED A GOVERNMENT TRANSPORTATION
REQUEST (GTR) ANNOTATED ONLY WITH THE ANCHORAGE-WASHINGTON, D. C.-
ANCHORAGE ROUTING TO OBTAIN AN AIRLINE TICKET FOR OFFICIAL TRAVEL
COMMENCING SEPTEMBER 27, 1982, BETWEEN ANCHORAGE AND WASHINGTON, D. C.
THE AIRLINE TICKETS WERE ISSUED ON SEPTEMBER 17, 1982, BY THE SCHEDULED
AIRLINES TRAFFIC OFFICE (SATO) IN ANCHORAGE, ACTING AS AGENT FOR
NORTHWEST AIRLINES. ON SEPTEMBER 17, 1982, WHEN MS. BOBERICK'S TICKET
WAS ISSUED BOTH SATO AND NORTHWEST AIRLINES INDICATED THAT $820.84 WAS
THE LOWEST ROUND-TRIP FARE AVAILABLE FOR THE OFFICIAL
ANCHORAGE-WASHINGTON, D. C.-ANCHORAGE ROUTING. AT THIS POINT MS.
BOBERICK ASKED THE TICKETING AUTHORITY TO INCLUDE A SEGMENT OF PERSONAL
TRAVEL PROVIDING FOR AN INTERMEDIATE STOP IN LOS ANGELES. THIS PORTION
OF INDIRECT PERSONAL TRAVEL INCREASED THE COST OF THE OFFICIAL TRAVEL
ITINERARY BY $9.40, AND WAS PAID FOR BY MS. BOBERICK.
SUBSEQUENTLY, THE AGENCY'S SEATTLE REGIONAL ACCOUNTING OFFICE NOTED
AN APPARENT DISCREPANCY SINCE ANOTHER EMPLOYEE RETURNING FROM
WASHINGTON, D. C., ON OCTOBER 1, 1982, WAS TICKETED BY THE ANCHORAGE
SATO AT A COST OF $598.93. DETERMINING THAT OTHER LOWER FARES WERE IN
EXISTENCE FOR HER OFFICIAL TRAVEL AND NOTING THAT THE TRAVELER MUST BEAR
ANY INCREASED EXPENSE INCIDENT TO INDIRECT ROUTING, THE SEATTLE REGIONAL
OFFICE DISALLOWED $248.19 OF MS. BOBERICK'S TOTAL TRAVEL CLAIM.
CONTENTIONS OF THE PARTIES
THE ANCHORAGE SATO, WHICH PROVIDES DESIGNATED TRAVEL VENDOR SERVICES
FOR GOVERNMENT EMPLOYEES, EXPLAINS THAT IN ORDER TO CONTINUE TO PROVIDE
SPECIAL FARES FOR GOVERNMENT TRAVELERS THEY CONTACTED THE NORTHWEST
AIRLINES TARIFF DEPARTMENT ON SEPTEMBER 5, 1982, CONCERNING THE SCHEDULE
OF GOVERNMENT CONTRACT AIRFARES WHICH WAS DUE TO EXPIRE ON SEPTEMBER 30,
1982. THE ORIGINAL CONTRACT AIRFARES EXPIRED ON JUNE 30, 1982, BUT THE
AIRLINES CONTINUED THESE FARES FOR 3 MONTHS TO ALLOW THE GENERAL
SERVICES ADMINISTRATION ADDITIONAL TIME TO AWARD NEW CONTRACTS.
NORTHWEST AIRLINES ADVISED THE ANCHORAGE SATO ON SEPTEMBER 17, 1982,
REGARDING THE NEW CITY-PAIR AWARDS THAT HAD BEEN SECURED UNDER THE NEW
CONTRACT EFFECTIVE OCTOBER 1, 1982, AND THE SEATTLE-WASHINGTON, D. C.,
CITY-PAIR WAS NOT INCLUDED. THUS, THE ANCHORAGE SATO CONTENDS AS
FOLLOWS:
"MS. BOBERICK WAS TICKETED BY OUR
OFFICE ON SEPTEMBER 17TH. HER TRAVEL
ORIGINATED FROM ANCHORAGE ON SEPTEMBER 27TH.
ON SEPTEMBER 28TH WE RECEIVED A NEW TELETYPE
MESSAGE FROM NORTHWEST AIRLINES ADVISING US OF
THE NEW GOVERNMENT TRAVEL FARE (YDG) THAT THEY
PUT INTO EFFECT FROM SEATTLE TO WASHINGTON,
D. C. SINCE MS. BOBERICK HAD ALREADY DEPARTED
FROM ANCHORAGE THERE WAS NO CHANCE TO REFIGURE
HER FARE. OUR FARE COMPUTATION ON THE DAY OF
TICKETING WAS THE CORRECT AND LOWEST FARE
AVAILABLE FOR THE DATES OF HER RESERVATIONS. THIS
COMPUTATION WAS ARRIVED AT BY USING THE MOST
DIRECT ROUTE OF TRAVEL."
DURING THEIR REVIEW OF MS. BOBERICK'S REIMBURSEMENT CLAIM, THE
SEATTLE REGIONAL OFFICE WAS ADVISED BY THE ANCHORAGE SATO THAT
INFORMATION FROM NORTHWEST AIRLINES CONCERNING A LOW FARE, WHICH WOULD
REPLACE THE CONTRACT FARE THAT EXPIRED ON SEPTEMBER 30, WAS NOT RECEIVED
UNTIL SEPTEMBER 28, 1982. HOWEVER, ON SEPTEMBER 22, THE ANCHORAGE SATO
TICKETED ANOTHER EMPLOYEE WHO WAS ALSO TRAVELING FROM WASHINGTON, D. C.,
TO ANCHORAGE, ALASKA, ON OCTOBER 1 AT $598.93 INSTEAD OF $820.84. THE
REGION HAS SINCE CONTACTED THE SATO ABOUT THIS DISCREPANCY AND WAS TOLD
THAT THE AMOUNT CHARGED FOR THE SEPTEMBER 22 TICKET WAS AN ERROR ON
THEIR PART.
THUS, THE AGENCY'S ACTING DIRECTOR OF ADMINISTRATIVE SERVICES
CONCLUDES THAT SINCE MRS. BOBERICK UTILIZED THE DESIGNATED TRAVEL
SERVICES PROVIDED FOR HER AREA, THE ANCHORAGE SATO, AND THE CONTRACT
AIRLINE SERVICE EXPIRED ON SEPTEMBER 30, 1982, REIMBURSEMENT OF THE FULL
FARE IN EXISTENCE AT THE TIME OF THE TICKET PURCHASE SHOULD BE
AUTHORIZED. THE CERTIFYING OFFICER DISAGREED CONTENDING THAT THE LOW
FARE QUOTED BY SATO WAS THE LOWEST FARE FOR THE ROUTE REQUESTED AND NOT
THE LOWEST DIRECT FARE. SINCE MS. BOBERICK HAD DEVIATED FROM THE DIRECT
ROUTE FOR PERSONAL REASONS, THE CERTIFYING OFFICER DISALLOWED $248.19 OF
HER TRAVEL CLAIM.
DISCUSSION
IN FURTHERANCE OF OUR DELIBERATIONS ON THE TICKETING AND AIRFARE
ISSUES IN THIS CASE WE HAVE RECEIVED WIDELY DIVERGENT TECHNICAL
INTERPRETATIONS FROM THOSE EXPERT TRAVEL RESOURCE AUTHORITIES AVAILABLE
TO TRAVELERS AS WELL AS THIS OFFICE. THE DIVERSITY OF OPINION ON THE
CORRECT METHOD OF COMPUTING MS. BOBERICK'S TRAVEL COST REIMBURSEMENT
ARISES FROM THE ACKNOWLEDGED COMPLEXITY OF SCHEDULING AIR TRAVEL AT A
PARTICULAR TIME TO ACHIEVE THE MOST ADVANTAGEOUS FARE BASIS WHILE TAKING
INTO ACCOUNT VARIABLES SUCH AS COMPETITIVE AIRLINE ROUTING, PRICING,
SCHEDULING, CONTRACT AND DISCOUNT AIRFARES, AND THE MYRIAD OF
LIMITATIONS AND RESTRICTIONS THAT MAY APPLY AT CERTAIN TIMES TO SOME OR
ALL OF THESE VARIABLES.
THUS, INDEPENDENT EVALUATION BY TRAVEL EXPERTS WITHIN THIS OFFICE
FOUND THAT THE CONTRACT FARE IN EFFECT AS OF THE DATE WHEN THE TICKETS
WERE ISSUED ON SEPTEMBER 17, AND WHEN THE FIRST LEG OF THE ROUND TRIP
WAS BEGUN ON SEPTEMBER 27, SHOULD HAVE BEEN THE APPLICABLE FARE FOR THE
RETURN TRAVEL ON OCTOBER 1 AND 3, EVEN THOUGH THE CONTRACT FARE HAD
EXPIRED ON SEPTEMBER 30, 1982. THIS FOLLOWS FROM THE FACT THAT
ACCORDING TO TARIFF RULES, AND CONTRACT FARES AT THIS TIME WERE FILED IN
TARIFFS, UNLESS OTHERWISE PROVIDED FOR, THE APPLICABLE FARE FOR ANY
TRAVEL IS THE FARE IN EFFECT ON THE DATE TRAVEL BEGINS AT THE POINT OF
ORIGIN - THE ORIGIN BEING THE PLACE WHERE THE FIRST FLIGHT COVERED BY
THE TICKET IS TAKEN. IN THIS CASE, THE ORIGIN IS ANCHORAGE AND THE
EFFECTIVE DATE IS SEPTEMBER 27. THE RULE COVERING THIS PRINCIPLE WAS
FILED IN RULE 1(C), FOUND ON PAGE 15 IN THE RULES TARIFF (PR-7, CAB NO.
352) PUBLISHED BY THE AIRLINE TARIFF PUBLISHING COMPANY. THEREFORE, IN
THE OPINION OF OUR OWN EXPERTS, CONTRACT AIRFARES WERE AVAILABLE AND
WERE APPLICABLE TO MS. BOBERICK'S ENTIRE TRAVEL ITINERARY.
HOWEVER, IN RESPONSE TO OUR REQUEST FOR COMMENTS, THE GENERAL
SERVICES ADMINISTRATION'S (GSA) TRANSPORTATION AUDIT DIVISION INFORMALLY
ADVISED US THAT CONTRACT AIRFARES DO NOT APPLY TO MS. BOBERICK'S TRAVEL
CLAIM. THUS, THE INTERPRETATION NOTED ABOVE DOES NOT CONTROL HER TRAVEL
ENTITLEMENT. THE GSA POINTS OUT THAT THE CONTRACT FARE BASIS CODE "YCA"
MUST BE SHOWN ON THE GTR AND THE AIRLINE TICKET. SINCE MS. BOBERICK'S
GTR WAS NOT ANNOTATED WITH THE "YCA" FARE BASIS IDENTIFICATION, NO
AVAILABLE CONTRACT AIRFARES WERE APPLICABLE TO MS. BOBERICK'S TRAVEL.
SEE ALSO FPMR TEMP.REG. A-19, 46 FED.REG. 40690-40691 (1981).
CONCLUSION
THE POLICY CONCERNING INDIRECT ROUTE OR INTERRUPTED TRAVEL IS
CONTAINED IN PARAGRAPH 1-2.5B OF THE FEDERAL TRAVEL REGULATIONS, AND
PARAGRAPH 4-4B OF THE AGENCY'S TRAVEL HANDBOOK, WHICH PROVIDE THAT WHEN
A PERSON FOR HIS OWN CONVENIENCE TRAVELS BY AN INDIRECT ROUTE OR
INTERRUPTS TRAVEL BY DIRECT ROUTE, THE EXTRA EXPENSE SHALL BE BORNE BY
THE TRAVELER. REIMBURSEMENT FOR EXPENSES SHALL BE BASED ONLY ON SUCH
CHARGES AS WOULD HAVE BEEN INCURRED BY A USUALLY TRAVELED ROUTE. THUS,
IN ALAN G. BOLTON, JR., B-200027, AUGUST 24, 1981, WE HELD THAT AN
AGENCY WAS CORRECT IN LIMITING AN EMPLOYEE'S REIMBURSEMENT TO THE
CONSTRUCTIVE TRAVEL COST BASED ON THE USE OF A HALF-FARE DISCOUNT COUPON
WHERE THE EMPLOYEE INTERRUPTED HIS RETURN TRAVEL FOR PERSONAL REASONS.
IF IT COULD BE DETERMINED THAT THE REASON MS. BOBERICK SECURED HER
TICKET ON SEPTEMBER 17, AND PERFORMED HER TRAVEL ON SEPTEMBER 27, WAS
SOLELY PREDICATED ON HER OBTAINING AN INDIRECT ROUTING, WE WOULD BE
INCLINED TO CHALLENGE THE RELATIVE COST OF THE FARE BASIS SHE USED.
THIS OFFICE HAS LONG BEEN PERSUADED THAT THE OPPORTUNITY THAT GOVERNMENT
TRAVEL MAY AFFORD AN EMPLOYEE TO AUGMENT HIS OR HER PERSONAL TRAVEL
PLANS IS PURELY FORTUITOUS AND IS SANCTIONED ONLY INSOFAR AS IT DOES NOT
RESULT IN ADDITIONAL COST TO THE GOVERNMENT OR CONTRAVENE OTHERWISE
APPLICABLE LAWS AND REGULATIONS. HOWEVER, WE DO NOT FIND THAT IN MS.
BOBERICK'S CASE.
UNDER TRAVEL ORDERS DATED AUGUST 19, 1982, FOR OFFICIAL BUSINESS
WHICH PERMITTED TRAVEL ON SEPTEMBER 27, 1982, MS. BOBERICK SECURED
COMMERCIAL AIRLINE TICKETS ON SEPTEMBER 17, 1982. THE GTR WHICH MS.
BOBERICK USED TO SECURE HER TICKETS WAS ANNOTATED ONLY WITH THE DIRECT
OFFICIAL ITINERARY BETWEEN ANCHORAGE AND WASHINGTON, D. C. AT THE TIME
SHE PURCHASED HER TICKETS, SATO - A DESIGNATED TRAVEL VENDOR SERVICE -
ACTING AS AGENT FOR THE EXISTING LOW COST CONTRACT CARRIER, QUOTED THE
LOWEST AVAILABLE FARE AS $820.84. THIS WAS THE COST ATTRIBUTABLE TO THE
OFFICIAL ITINERARY AS REFLECTED ON THE GTR, AND THIS WAS THE COST FUNDED
BY THE GOVERNMENT. ONLY AFTER THIS UNDERSTANDING HAD BEEN REACHED DID
MS. BOBERICK ASK FOR ADDITIONAL SEGMENT ROUTING THROUGH LOS ANGELES AT A
COST OF $9.40, WHICH SHE FUNDED HERSELF.
WHILE THERE ARE DIVERGENT EXPERT OPINIONS, WE THINK IT WAS POSSIBLE
TO SECURE A LOWER FARE IN THE CIRCUMSTANCES OF THIS CASE; BUT NOT ON
SEPTEMBER 17, 1982, WHEN MS. BOBERICK PURCHASED HER TICKETS. FOR ON
THAT DATE THE ACKNOWLEDGED EXPERTS AT SATO, AS WELL AS THE CONTRACT
CARRIER, ADVISED THAT A CONTRACT FARE (YCA FARE BASIS) COULD NOT BE
QUOTED FOR THE RETURN TRAVEL BECAUSE OF THE EXPIRATION OF THE GSA
CITY-PAIRS CONTRACT SCHEDULED FOR SEPTEMBER 30, 1982. THE
SEATTLE-DISTRICT OF COLUMBIA CITY-PAIR CONTRACT WAS NOT INITIALLY
SERVICED BY THE NEW CONTRACTS, WHICH BECAME EFFECTIVE ON OCTOBER 1,
1982. MOREOVER, ON SEPTEMBER 17, 1982, THE "YDG" FARE LATER OFFERED BY
NORTHWESTERN AIRLINES TO REPLACE THE EXPIRED YCA (CONTRACT) FARE WAS NOT
AVAILABLE EVEN THOUGH IT WAS IMPLEMENTED BY OCTOBER 1, 1982. THE
ANCHORAGE SATO INDICATED THAT THEY WERE NOT INFORMED OF THE NEW "YDG"
FARE OFFERED BY NORTHWESTERN UNTIL SEPTEMBER 28, 1982, THE DAY OF MS.
BOBERICK'S DEPARTURE.
ACCORDINGLY, IN THE CIRCUMSTANCES OF THIS CASE, WE CONCLUDE THAT MS.
BOBERICK SHOULD NOT BE PENALIZED WHERE SHE ACTED IN GOOD FAITH AND IN
CONFORMANCE WITH TRAVEL AUTHORITIES, BUT NEVERTHELESS ENCOUNTERED TICKET
PRICE DISCREPANCIES WHEN USING GOVERNMENT-DESIGNATED TRAVEL VENDOR
SERVICES. THE RECLAIM VOUCHER IN THE AMOUNT OF $248.19 MAY BE CERTIFIED
FOR PAYMENT.
THE CERTIFYING OFFICER ALSO REFERS TO THE CLAIMS OF THREE OTHER
AGENCY EMPLOYEES WITH ALLEGEDLY SIMILAR CIRCUMSTANCES AS MS. BOBERICK.
WE ARE UNABLE TO MAKE A DETERMINATION IN THEIR CASES BASED ON THE RECORD
FURNISHED. THUS, THE AGENCY SHOULD COORDINATE WITH GSA AND MAKE A
DETERMINATION AS TO WHETHER TICKET PRICE DISCREPANCIES OCCURRED, OR
WHETHER THE EMPLOYEE'S ACTION CAUSED AN EXCESSIVE RATE. ALAN G.
BOLTON, JR., ABOVE.
B-210370, JAN 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE FIRM INITIALLY PROTESTS ALLEGED SPECIFICATION DEFECTS TO
CONTRACTING AGENCY PRIOR TO BID OPENING, OPENING OF BIDS IS INITIAL
ADVERSE AGENCY ACTION ON PROTEST AND SUBSEQUENT PROTEST TO GAO MUST BE
FILED WITHIN 10 WORKING DAYS OF PROTESTER'S ACTUAL OR CONSTRUCTIVE
KNOWLEDGE OF THAT ACTION.
BAXTER & SONS ELEVATOR CO., INC.:
BAXTER & SONS ELEVATOR CO., INC. PROTESTS PROVISIONS CONTAINED IN
INVITATION FOR BIDS 549-1-83 ISSUED BY THE VETERANS ADMINISTRATION (VA).
BAXTER COMPLAINS THAT VA PROCEEDED WITH BID OPENING NOTWITHSTANDING ITS
PROTEST THAT THESE PROVISIONS ARE UNDULY RESTRICTIVE OF COMPETITION. WE
DISMISS THE PROTEST.
UNDER OUR BID PROTEST PROCEDURES, 4 C.F.R. SECS. 21.2(A), 21.2(B)(1)
(1982), PROTESTS CONCERNING DEFECTS APPARENT IN A SOLICITATION MUST BE
FILED WITH OUR OFFICE OR THE CONTRACTING AGENCY PRIOR TO BID OPENING.
IF A PROTEST IS FILED INITIALLY WITH THE CONTRACTING ACTIVITY, WE WILL
CONSIDER A SUBSEQUENT PROTEST TO OUR OFFICE ONLY IF IT IS FILED HERE
WITHIN 10 WORKING DAYS AFTER THE PROTESTER HAS ACTUAL OR CONSTRUCTIVE
KNOWLEDGE OF INITIAL ADVERSE ACTION BY THE CONTRACTING AGENCY. THE FACT
THAT BID OPENING OCCURS IS CONSTRUCTIVE NOTICE THAT THE CONTRACTING
OFFICE REJECTS THE PROTEST. BERNARD FRANKLIN COMPANY, B-207126, MAY 3,
1982, 82-1 CPD 414.
BAXTER'S PROTEST TO VA WAS DATED DECEMBER 10, 1982 AND WAS RECEIVED
BY VA BY DECEMBER 13. VA PROCEEDED WITH BID OPENING ON DECEMBER 15, AS
ACHEDULED. BAXTER'S PROTEST TO OUR OFFICE WAS FILED (RECEIVED) ON
JANUARY 4, 1983. SINCE WE DID NOT RECEIVE BAXTER'S PROTEST IN OUR
OFFICE UNTIL MORE THAN 10 WORKING DAYS AFTER BAXTER KNEW OR SHOULD HAVE
KNOWN OF THE BID OPENING, IT IS UNTIMELY.
THE PROTEST IS DISMISSED.
B-210368.2, AUG 23, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST THAT PROCURING AGENCY IMPROPERLY
RELEASED PRICE AND TECHNICAL DATA OF PROTESTER'S TERMINATED
CONTRACT TO COMPETITORS IS UNTIMELY WHEN NOT FILED PRIOR TO
CLOSING DATE FOR RECEIPT OF PROPOSALS ON RESOLICITATION FOLLOWING
TERMINATION.
2. CONTRACTING OFFICER HAS DISCRETION NOT
TO CONDUCT A PREAWARD SURVEY, AND IN THE ABSENCE OF A SHOWING OF
FRAUD OR THE FAILURE TO APPLY A DEFINITIVE RESPONSIBILITY
REQUIREMENT, GAO WILL NOT REVIEW A DECISION NOT TO CONDUCT A
PREAWARD SURVEY, NOR REVIEW THE CONTRACTING OFFICER'S AFFIRMATIVE
DETERMINATION OF RESPONSIBILITY. BELOW COST PROPOSAL PROVIDES NO
BASIS FOR PROTEST BECAUSE PROCURING AGENCY DETERMINED THAT FIRM IS
RESPONSIBLE.
3. UNSUPPORTED ALLEGATION THAT FIRM'S
CAMERA DOES NOT MEET FLASHBULB SYNCHRONIZATION REQUIREMENT IS
DENIED.
4. PROTEST THAT FIRM OBTAINED COMPETITIVE
PRICE ADVANTAGE BY OFFERING UNACCEPTABLE CAMERA CASE AS EQUIVALENT
TO BRAND NAME IS DENIED BECAUSE SOLICITATION ALLOWED BRAND NAME OR
EQUIVALENT AND FIRM OFFERED BRAND NAME AND COMPETITIVE PRICE
THEREFOR IN THE ALTERNATIVE.
OSAWA & CO.:
OSAWA & CO. (OSAWA), THE PROTESTER, WAS AWARDED A CONTRACT UNDER
REQUEST FOR PROPOSALS (RFP) NO. F42600-82-R-0156 BY THE OGDEN AIR
LOGISTICS CENTER, HILL AIR FORCE BASE ON SEPTEMBER 30, 1982, FOR 60
STILL PICTURE, GENERAL PURPOSE, MEDIAN FORMAT CAMERAS. HOWEVER, UPON
DISCOVERING THAT ANOTHER OFFEROR, CAMERA DEN, HAD NOT RECEIVED AN
IMPORTANT AMENDMENT REGARDING SPECIFICATIONS, THE CONTRACTING OFFICER
TERMINATED OSAWA'S CONTRACT ON NOVEMBER 16, 1982. THE REQUIREMENT WAS
RESOLICITED IN RFP NO. FD2020-83-25729 FOR 100 CAMERAS. CAMERA DEN WAS
THE APPARENT LOW SUCCESSFUL OFFEROR. OSAWA PROTESTS THE PROPOSED AWARD
OF A CONTRACT TO CAMERA DEN.
WE DENY THE PROTEST IN PART AND DISMISS THE PROTEST IN PART.
OSAWA PROTESTS THAT CAMERA DEN RECEIVED A COMPETITIVE ADVANTAGE IN
THE RESOLICITATION BECAUSE THE AIR FORCE RELEASED THE PRICE OF THE
CONTRACT AWARDED TO OSAWA AND MAY HAVE RELEASED DETAILS REGARDING ITS
TECHNICAL PROPOSAL UNDER RFP-0156.
THE AIR FORCE DENIES IMPROPERLY RELEASING ANY INFORMATION. AS TO THE
PRICE OF OSAWA'S CONTRACT, THE AIR FORCE REPLIES THAT IT WAS REQUIRED BY
DEFENSE ACQUISITION REGULATION (DAR) SEC. 3-508.3 (DEFENSE ACQUISITION
CIRCULAR 76-40, NOVEMBER 26, 1982) TO SO ADVISE UNSUCCESSFUL OFFERORS,
INCLUDING CAMERA DEN. THE AIR FORCE ARGUES THAT OSAWA WAS NOT
PREJUDICED BY THE RELEASE OF ITS PRICE FOR 60 CAMERAS BECAUSE THE
QUANTITY OF CAMERAS TO BE PROCURED ON RESOLICITATION WAS INCREASED TO
100 CAMERAS. FINALLY, THE AIR FORCE ARGUES THAT THIS ALLEGATION IS
UNTIMELY FILED UNDER OUR BID PROTEST PROCEDURES, 4 C.F.R. PART 21
(1983).
THIS GROUND OF PROTEST IS UNTIMELY. THE ALLEGED COMPETITIVE
PREJUDICE FROM THE PRICE DISCLOSURE AND CIRCUMSTANCES FROM WHICH OSAWA
INFERS THE IMPROPER RELEASE OF TECHNICAL INFORMATION WERE OR SHOULD HAVE
BEEN KNOWN AT THE TIME OF THE RESOLICITATION. OSAWA WAS THEREFORE
REQUIRED TO PROTEST NO LATER THAN THE FEBRUARY 23, 1983, CLOSING DATE.
4 C.F.R. SEC. 21.2(B)(1) (1983). HOWEVER, THE PROTEST WAS NOT FILED
HERE UNTIL MARCH 11, 1983.
THE AIR FORCE IS WITHHOLDING AWARD OF A CONTRACT UNTIL OUR RESOLUTION
OF THE PROTEST. OSAWA SHOULD, THEREFORE, BE UNAWARE OF CAMERA DEN'S
PRICE. HOWEVER, OSAWA CONTENDS IT HAS BEEN ADVISED THAT CAMERA DEN'S
PRICE IS MORE THAN $100 LOWER THAN OSAWA'S PRICE. OSAWA CONTENDS THAT
CAMERA DEN CANNOT MEET THE CONTRACT REQUIREMENTS AT SUCH A PRICE AND
PROTESTS THAT THE AIR FORCE DID NOT CONDUCT A PREAWARD SURVEY. OSAWA IS
PARTICULARLY CONCERNED THAT CAMERA DEN LACKS THE FACILITIES NECESSARY TO
CONDUCT REQUIRED TESTING AND COMPLY WITH THE IDENTIFICATION MARKING
REQUIREMENT. OSAWA CONTENDS THE AIR FORCE'S "CURSORY" REVIEW OF CAMERA
DEN'S RESPONSIBILITY CONTRASTS WITH THE AIR FORCE'S PREVIOUS REVIEW OF
OSAWA'S RESPONSIBILITY. THE AIR FORCE ACKNOWLEDGES THAT IT DID NOT
CONDUCT A PREAWARD SURVEY, YET CONTENDS IT CONDUCTED A THOROUGH REVIEW
OF CAMERA DEN'S RESPONSIBILITY. A PREAWARD SURVEY WAS UNNECESSARY, THE
AIR FORCE STATES, BECAUSE CAMERA DEN HAS A GOOD DELIVERY AND PERFORMANCE
RECORD IN PAST SALES TO THE PROCURING ACTIVITY.
WE HAVE HELD THAT A PREAWARD SURVEY IS NOT A LEGAL PREREQUISITE TO AN
AFFIRMATIVE DETERMINATION OF RESPONSIBILITY. CONTRACTING OFFICIALS HAVE
BROAD DISCRETION REGARDING WHETHER TO CONDUCT A PREAWARD SURVEY AND WE
WILL NOT REVIEW SUCH A DECISION ABSENT ON ALLEGATION OF FRAUD OR THE
FAILURE TO APPLY A DEFINITIVE RESPONSIBILITY REQUIREMENT, SINCE THE
DECISION IS PART OF AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY.
PARAMATIC FILTER CORPORATION, B-210138, FEBRUARY 24, 1983, 83-1 CPD 187.
OSAWA'S ALLEGATIONS DO NOT WARRANT OUR REVIEW, UNDER EITHER OF THESE
EXCEPTIONS, OF CAMERA DEN'S ABILITY TO COMPLY WITH THE TESTING AND
IDENTIFICATION MARKING REQUIREMENTS. MERCHANTS RENT-A-CAR, INC.,
B-211934, JUNE 15, 1983, 83-1 CPD 659. SIMILARLY, OSAWA'S CONTENTION
THAT CAMERA DEN CANNOT COMPLY WITH THE CONTRACT AT AN ALLEGEDLY BELOW
COST PRICE DOES NOT PROVIDE A LEGAL BASIS FOR CHALLENGING AN AWARD TO A
OFFEROR WHICH THE PROCURING AGENCY DETERMINES IS RESPONSIBLE. WHETHER
CAMERA DEN ULTIMATELY SUPPLIES AN ITEM CONFORMING TO THE CONTRACT
REQUIREMENTS IS A MATTER OF CONTRACT ADMINISTRATION, WHICH IS THE
RESPONSIBILITY OF THE PROCURING AGENCY AND NOT THIS OFFICE. CONTROL
TECHNOLOGY CO., INC., B-210860, MARCH 14, 1983, 83-1 CPD 254.
OSAWA PROTESTS THAT CAMERA DEN'S CAMERA WILL NOT MEET THE FLASHBULB
SYNCHRONIZATION REQUIREMENT OF PARAGRAPH 3.6 OF THE SPECIFICATIONS. NO
FURTHER INFORMATION IS PROVIDED BY OSAWA. THE AIR FORCE CONTENDS THE
CAMERA WILL MEET THIS REQUIREMENT. WE CONCLUDE THAT OSAWA HAS NOT
CARRIED ITS BURDEN OF PROOF AND DENY THIS GROUND OF PROTEST.
THE SOLICITATION REQUIRED THAT OFFERORS PROVIDE A HALLIBURTON CAMERA
CASE OR EQUIVALENT. OSAWA'S FINAL GROUND OF PROTEST IS THAT CAMERA DEN
OBTAINED ITS PRICE ADVANTAGE FROM THE FACT THAT CAMERA DEN OFFERED A
GENERIC ALUMINUM CAMERA CASE WHICH THE AIR FORCE'S TECHNICAL REVIEW
STAFF DETERMINED WAS NOT EQUIVALENT TO THE HALLIBURTON CASE. WHILE IT
IS TRUE THAT CAMERA DEN OFFERED A GENERIC ALUMINUM CASE AS AN
EQUIVALENT, THE GENERIC CASE, AS PERMITTED BY THE SOLICITATION, WAS
OFFERED AS AN ALTERNATIVE TO THE HALLIBURTON CASE IN CAMERA DEN'S
PROPOSAL. CAMERA DEN CLEARLY OFFERED BOTH THE BRAND NAME OR A PROPOSED
EQUIVALENT AND RESPECTIVE PRICES THEREFOR. THE FACT THAT THE GENERIC
CASE WAS NOT APPROVED AS AN EQUIVALENT DID NOT PRECLUDE THE AIR FORCE
FROM ACCEPTING CAMERA DEN'S OFFER OF A HALLIBURTON CASE. IN ANY EVENT,
WITHOUT BEING SPECIFIC AS TO PRICING BECAUSE OF THE PREAWARD STATUS OF
THIS NEGOTIATED PROCUREMENT, WE NOTE THAT CAMERA DEN'S PRICE ADVANTAGE
REMAINS IRRESPECTIVE OF WHICH CASE THE AGENCY DECIDED TO ACCEPT.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
B-210366, JUN 13, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
AGENCY WAS NOT REQUIRED TO PROVIDE A LIST OF EVERY SPECIFIC
DEFICIENCY FOUND IN PROTESTER'S PROPOSAL WHERE THE PROPOSAL WAS LACKING
IN INFORMATIONAL DETAIL, AND THE AGENCY REASONABLY BELIEVED THAT THE
DEGREE OF SPECIFIC DIRECTION NECESSARY WAS LIKELY TO RESULT IN TECHNICAL
TRANSFUSION OR LEVELING. UNDER THE CIRCUMSTANCES, THE AGENCY'S CLEAR
ADVICE THAT THE PROPOSAL WAS INFORMATIONALLY INADEQUATE IN KEY RESPECTS,
AND ITS IDENTIFICATION OF A NUMBER, BUT NOT ALL, OF THE PROPOSAL'S
SPECIFIC DEFICIENCIES, WAS ADEQUATE.
ESSEX ELECTRO ENGINEERS, INC.:
ESSEX ELECTRO ENGINEERS, INC. PROTESTS THE REJECTION OF ITS TECHNICAL
PROPOSAL BY THE DEPARTMENT OF THE ARMY IN THE FIRST STEP OF A TWO-STEP
FORMALLY ADVERTISED PROCUREMENT, SOLICITATION NO. DAAK70-82-B-0127.
THE SOLICITATION WAS A TOTAL SMALL BUSINESS SET-ASIDE FOR 10KW, 28 VOLT
AVIATION DIRECT CURRENT GENERATOR SETS, PLUS A TECHNICAL DATA PACKAGE.
WE DENY THE PROTEST.
ESSEX PRIMARILY CHALLENGES THE ADEQUACY OF THE DISCUSSIONS HELD WITH
IT AFTER SUBMISSION OF ITS INITIAL TECHNICAL PROPOSAL. ESSEX CONTENDS
THAT ITS REVISED PROPOSAL WAS REJECTED ON THE BASIS OF DEFICIENCIES THAT
THE ARMY HAD NOT PREVIOUSLY POINTED OUT TO THE FIRM.
ESSEX STATES THAT IT RECEIVED A NOTICE FROM THE ARMY DATED NOVEMBER
4, 1982, STATING THAT ITS INITIAL PROPOSAL HAD BEEN FOUND REASONABLY
SUSCEPTIBLE OF BEING MADE ACCEPTABLE. ESSEX ASSERTS THAT THIS NOTICE
DID NOT IDENTIFY THE SPECIFIC DEFICIENCIES FOUND IN ITS PROPOSAL BUT
INSTEAD SET FORTH VAGUE AND INDEFINITE GENERALITIES. ACCORDING TO
ESSEX, NUMEROUS PHONE CALLS TO THE PROCURING ACTIVITY FAILED TO DISCLOSE
ANY PARTICULAR ACTIONS OR CHANGES NEEDED, AND IT THEREFORE RESPONDED IN
ITS REVISED PROPOSAL ONLY TO THOSE SPECIFIC DEFICIENCIES IT "SURMISED"
THE AGENCY HAD IDENTIFIED.
THE ARMY ADVISES THAT AFTER THE INITIAL TECHNICAL EVALUATION, THE
EVALUATION BOARD UNANIMOUSLY RECOMMENDED THAT ESSEX'S PROPOSAL BE
CATEGORIZED AS UNACCEPTABLE. NEVERTHELESS, THE CONTRACTING OFFICER
DETERMINED THAT ESSEX SHOULD BE GIVEN AN OPPORTUNITY TO SUBMIT A REVISED
PROPOSAL. HE DID SO BECAUSE OF THE FOLLOWING STATEMENT CONTAINED IN
ESSEX'S COVER LETTER TO ITS PROPOSAL:
"SINCE OUR REQUEST FOR A BID EXTENSION AND FOR
ADDITIONAL INFORMATION HAS BEEN DENIED, WE ARE
SUBMITTING OUR PROPOSAL WITH THE UNDERSTANDING
THAT IN THE EVENT THE GOVERNMENT FINDS OUR PROPOSAL
NOT ACCEPTABLE, THE GOVERNMENT WILL NOTIFY
US AND GIVE US AMPLE TIME TO SUBMIT ADDITIONAL
INFORMATION." IN THIS REGARD, THE FIRST STEP OF A TWO-STEP FORMALLY
ADVERTISED PROCUREMENT IS SIMILAR TO A NEGOTIATED PROCUREMENT IN THAT
TECHNICAL PROPOSALS ARE EVALUATED, DISCUSSIONS MAY BE HELD, AND REVISED
PROPOSALS MAY BE SUBMITTED. BAIRD CORPORATION, B-193261, JUNE 19, 1979,
79-1 CPD 435. WE HAVE HELD THAT THIS FIRST STEP CONTEMPLATES THE
QUALIFICATION OF AS MANY TECHNICAL PROPOSALS AS POSSIBLE UNDER
NEGOTIATION PROCEDURES, AND THAT AN AGENCY SHOULD MAKE REASONABLE
EFFORTS TO BRING STEP ONE PROPOSALS TO AN ACCEPTABLE STATUS. ANGSTROM,
INC., 59 COMP.GEN. 588 (1980), 80-2 CPD 20.
TELEPHONE DISCUSSIONS WERE HELD WITH ALL OFFERORS ON NOVEMBER 4,
1982, AND WERE CONFIRMED BY LETTER OF THE SAME DATE, REQUESTING
SUBMISSION OF REVISED PROPOSALS BY NOVEMBER 19. THE LETTER TO ESSEX
INDICATED THAT THE QUALITY OF ITS PROPOSAL WAS VERY MARGINAL, THAT THE
PROPOSAL WAS INCOMPLETE AND INADEQUATE IN SEVERAL CRITICAL AREAS, AND
THAT IT LACKED SUFFICIENT INFORMATION TO ALLOW A COMPREHENSIVE TECHNICAL
EVALUATION.
THE NOVEMBER 4 LETTER ALSO ADVISED THAT THE TECHNICAL PROPOSAL WOULD
BE EVALUATED TO DETERMINE THE ADEQUACY OF THE DESIGN AND METHODOLOGY TO
BE USED TO PRODUCE THE GENERATOR SET, AND THAT ESSEX'S RESPONSE SHOULD
BE SPECIFIC AND COMPLETE IN EVERY DETAIL TO VERIFY THAT THE GENERATOR
SET WOULD MEET THE TECHNICAL AND OPERATIONAL REQUIREMENTS OF THE
SOLICITATION. IT ADDED THAT THE PROPOSED APPROACH TO PERFORMING ALL
WORK MUST BE PROVIDED IN DETAIL, AND THAT MANAGEMENT, ENGINEERING, AND
SPECIAL TESTING MUST BE DISCUSSED, AND CAUTIONED THAT SIMPLE STATEMENTS
THAT THE OFFEROR WILL MEET THE GOVERNMENT'S REQUIREMENTS WOULD NOT BE
ACCEPTABLE.
THE ARMY ADMITS THAT THE LETTER DID NOT LIST SPECIFIC DEFICIENCIES
CONTAINED IN ESSEX'S PROPOSAL, BUT ASSERTS THAT THE PROPOSAL WAS SO
INADEQUATE THAT IT WAS NOT POSSIBLE TO PROVIDE SUCH A LIST. THE
CONTRACTING OFFICER STATES THAT TO GIVE THE DEGREE OF SPECIFIC DIRECTION
REQUIRED WOULD HAVE BEEN TANTAMOUNT TO THE GOVERNMENT ASSISTING IN
PROPOSAL PREPARATION, AND WOULD HAVE RISKED TRANSFERENCE OF TECHNICAL
INFORMATION FROM OTHER PROPOSALS.
NEVERTHELESS, DURING TELEPHONE CONVERSATIONS INITIATED BY ESSEX ON
NOVEMBER 5 AND 8, THE CONTRACT SPECIALIST IDENTIFIED SEVERAL SPECIFIC
AREAS OF CONCERN FOR WHICH ADDITIONAL INFORMATION WAS REQUIRED. IT WAS
FROM THESE CONVERSATIONS THAT ESSEX "SURMISED" THE EIGHT SPECIFIC
DEFICIENCIES IT ADDRESSED IN ITS RESPONSE TO THE ARMY'S NOVEMBER 4
LETTER.
ESSEX CONTENDS THAT IT WAS TOLD IN THE TELEPHONE CONVERSATIONS THAT
ALL OTHER ASPECTS OF ITS PROPOSAL WERE FULLY CONFORMING TO THE
REQUIREMENTS OF THE SOLICITATION. THE ARMY, HOWEVER, STATES THAT ESSEX
WAS INFORMED THAT ITS PROPOSAL WAS TOTALLY INADEQUATE, THAT ADDITIONAL
INFORMATION WAS NEEDED IN ALL AREAS OF THE EVALUATION CRITERIA, AND THAT
ESSEX'S RESPONSE SHOULD NOT BE LIMITED TO ONLY THOSE SPECIFIC AREAS
DISCUSSED. THE RECORD CONTAINS COPIES OF THE CONTRACT SPECIALIST'S
MEMORANDA CONCERNING THE PHONE CONVERSATIONS, WHICH SUPPORT THE ARMY'S
POSITION.
BY LETTER OF DECEMBER 22, THE CONTRACTING OFFICER ADVISED ESSEX THAT
THE FIRM'S TECHNICAL PROPOSAL WAS UNACCEPTABLE. THE LETTER STATED THAT
THE PROPOSAL FAILED TO PROVIDE A COMPLETE AND MEANINGFUL DISCUSSION OF
ESSEX'S PROPOSED APPROACH TO PERFORMING THE WORK NEEDED TO PRODUCE AND
TEST AN ACCEPTABLE SET, AND DID NOT INCLUDE THE DETAIL NECESSARY TO
ASSURE THE ARMY THAT ESSEX FULLY UNDERSTOOD THE AGENCY'S NEEDS AND THE
EFFORT REQUIRED TO SATISFY THEM. THE LETTER INCLUDED SPECIFIC EXAMPLES
TO SUPPORT THOSE TWO POINTS. THE LETTER ALSO ADVISED THAT ESSEX'S MERE
STATEMENTS THAT THE ITEM IT WOULD FURNISH WOULD MEET THE ARMY'S NEEDS
"WITHOUT A COMPLETE DETAILED DISCUSSION SUPPORTING SUCH STATEMENTS" WERE
NOT ACCEPTABLE UNDER THE TERMS OF THE SOLICITATION.
WE BELIEVE THE ARMY ACTED PROPERLY IN THIS CASE. ESSEX SUBMITTED A
PROPOSAL WHICH THE ARMY CHARACTERIZES AS LITTLE MORE THAN A BLANKET
OFFER TO COMPLY WITH THE EVALUATED REQUIREMENTS OF THE SOLICITATION,
USING ONE OF SIX ENGINE CONTRACTORS IDENTIFIED IN THE PROPOSAL. IN ITS
REPORT, THE ARMY HAS PROVIDED A DETAILED DISCUSSION OF THE MANY AREAS IN
WHICH IT CONSIDERED ESSEX'S PROPOSAL TO BE LACKING IN THE NECESSARY
DETAIL. IN FACT ESSEX DOES NOT DISPUTE THAT THESE DEFICIENCIES EXIST,
BUT BASICALLY INSISTS THAT THE AGENCY DID NOT CARRY OUT ITS OBLIGATION
TO POINT THEM OUT CLEARLY AND SPECIFICALLY TO ESSEX DURING DISCUSSIONS.
WE CANNOT AGREE WITH ESSEX THAT THE ARMY WAS REQUIRED TO PROVIDE
ESSEX WITH A POINT-BY-POINT DESCRIPTION OF THE DEFICIENCIES IN ITS
PROPOSAL IN ORDER TO BRING THE PROPOSAL TO AN ACCEPTABLE STATUS THROUGH
NEGOTIATION PROCEDURES. THE EXACT CONTENT AND EXTENT OF DISCUSSIONS IN
THE FIRST STEP OF A TWO-STEP PROCUREMENT ARE MATTERS OF JUDGMENT
PRIMARILY FOR DETERMINATION BY THE AGENCY INVOLVED, WHICH WE WILL NOT
QUESTION UNLESS THE AGENCY ACTS ARBITRARILY OR UNREASONABLY. SEE
KEN-MAR MACHINE AND HEALTH EQUIPMENT, INC., B-188529, JULY 14, 1977,
77-2 CPD 26 AT P. 6. OBVIOUSLY, NO PROCUREMENT SHOULD BE CONDUCTED IN A
MANNER THAT DISCRIMINATES AGAINST OR GIVES PREFERENTIAL TREATMENT TO ANY
COMPETITOR. SEE GOULD INC., B-192930, MAY 7, 1979, 79-1 CPD 311. THUS,
DEFICIENCIES OR WEAKNESSES IN A STEP ONE PROPOSAL NEED NOT BE POINTED
OUT WHEN TO DO SO COULD RESULT IN DISCLOSURE OF ONE OFFEROR'S INNOVATIVE
SOLUTION TO A PROBLEM (TECHNICAL TRANSFUSION). GUARDIAN ELECTRIC
MANUFACTURING COMPANY, 58 COMP.GEN. 119, 126 (1978), 78-2 CPD 376.
MOREOVER, WHILE THE GOAL OF THE FIRST STEP OF A TWO-STEP PROCUREMENT IS
THE QUALIFICATION OF OFFERORS RATHER THAN ACTUAL COMPETITION AMONG THEM,
COASTAL MOBILE AND MODULAR CORPORATION, B-183664, JULY 15, 1975, 75-2
CPD 39, WE FREQUENTLY HAVE STATED THAT AN AGENCY IS NOT REQUIRED, IN
CONDUCTING DISCUSSIONS IN A NEGOTIATION SITUATION, TO HELP AN OFFEROR
BRING HIS ORIGINAL INADEQUATE PROPOSAL UP TO THE LEVEL OF OTHER ADEQUATE
PROPOSALS BY DETAILING WEAKNESSES RESULTING FROM LACK OF DILIGENCE OR
COMPETENCE (TECHNICAL LEVELING). SEE DYNALECTRON CORPORATION, B-199741,
JULY 31, 1981, 81-2 CPD 70 AT P. 15.
ESSEX'S PROPOSAL WAS OBVIOUSLY INFORMATIONALLY INADEQUATE, AND THE
ARMY MADE IT QUITE CLEAR TO ESSEX THAT THIS WAS THE CASE. IN THIS
RESPECT, SINCE THE ONLY EVIDENCE ON ESSEX'S DISPUTED CONTENTION THAT
DURING THE TWO NOVEMBER TELEPHONE CONVERSATIONS THE ARMY CONTRACT
SPECIALIST TOLD THE FIRM THAT ITS PROPOSAL WAS FULLY CONFORMING EXCEPT
FOR EIGHT SPECIFIC DEFICIENCIES IS ESSEX'S UNSUPPORTED ALLEGATION, THE
PROTESTER HAS NOT MET ITS BURDEN OF PROOF ON THAT MATTER. ELECTRONIC
DATA SYSTEMS FEDERAL CORPORATION, B-207311, MARCH 16, 1983, 83-1 CPD
264. WE THEREFORE ARE CONSTRAINED TO ACCEPT THE ARMY'S VIEW, AS
REFLECTED IN THE CONTRACT SPECIALIST'S MEMORANDA, THAT ESSEX WAS ADVISED
THAT ITS ENTIRE PROPOSAL WAS INADEQUATE. HOLLEY ELECTRIC CONSTRUCTION
CO., INC., B-209384, JANUARY 31, 1983, 83-1 CPD 103.
IN VIEW OF THE PRINCIPLES THAT GUIDE THE CONDUCT OF DISCUSSIONS SET
OUT ABOVE, WE BELIEVE THE ARMY PROPERLY WAS CONCERNED THAT TO PROVIDE
ESSEX WITH A SPECIFIC AND DETAILED LISTING OF EVERY DEFICIENCY WOULD
HAVE BEEN IMPROPER. WE ARE UNWILLING TO SHIFT THE BURDEN FOR PROPOSAL
PREPARATION FROM THE OFFEROR, WHICH ITSELF SUSPECTED ITS INITIAL
PROPOSAL WAS INADEQUATE, TO THE AGENCY THAT IS CALLED ON TO CONFIRM THAT
SUSPICION, BY REQUIRING THE AGENCY TO TELL THAT OFFEROR PRECISELY WHAT
IT SHOULD HAVE WRITTEN IN TERMS OF A PROPOSAL. FN1 SEE DYNALECTRON
CORPORATION, SUPRA.
ESSEX RELIES ON OUR DECISION AT 51 COMP.GEN. 592 (1972) TO SUPPORT
ITS ARGUMENT THAT THE ARMY HAD AN OBLIGATION TO BE MORE SPECIFIC IN
IDENTIFYING THE DEFICIENCIES FOUND IN ITS PROPOSAL. IN THE CITED CASE,
WE SUSTAINED A PROTEST THAT AN AGENCY, IN THE FIRST STEP OF A TWO-STEP
PROCUREMENT, IMPROPERLY REJECTED AN OFFER FOR FAILURE TO ADDRESS A
SPECIFIC TECHNICAL REQUIREMENT IN ITS REVISED PROPOSAL WHERE THE AGENCY
HAD NOT EARLIER ADVISED THE OFFEROR OF THE NECESSITY TO DO SO. IN THAT
CASE, HOWEVER, THE BASIS FOR OUR HOLDING WAS THAT THE OFFEROR'S REVISED
PROPOSAL CONTAINED SUFFICIENT ASSURANCES THAT THE REQUIREMENT WOULD BE
COMPLIED WITH, AND THE TECHNICAL EVALUATION, COMMUNICATED TO THE
OFFEROR, ITSELF PROVIDED GUIDANCE AS TO HOW THE PROBLEM EASILY COULD BE
SOLVED. THAT FACTUAL SITUATION OBVIOUSLY DIFFERS FROM THE ONE INVOLVED
HERE.
THUS, WE CANNOT FAULT THE ARMY WITH REGARD TO THE INFORMATION IT
RELATED TO ESSEX ABOUT THE DEFICIENCIES IN THE FIRM'S INITIAL PROPOSAL.
WE ALSO DO NOT BELIEVE THAT THE ARMY, FACED WITH A REVISED OFFER THAT IT
STILL FOUND UNACCEPTABLE, HAD AN OBLIGATION TO ENGAGE IN FURTHER
TECHNICAL DISCUSSIONS WITH ESSEX RATHER THAN REJECTING THE REVISED
PROPOSAL. IT IS UNFAIR FOR A PROCURING AGENCY TO HELP ONE OFFEROR
THROUGH SUCCESSIVE ROUNDS OF DISCUSSIONS TO UPGRADE ITS PROPOSAL BY
POINTING OUT THOSE WEAKNESSES WHICH REMAIN AS THE RESULT OF THE
OFFEROR'S OWN LACK OF DILIGENCE, COMPETENCE OR INVENTIVENESS AFTER
HAVING BEEN GIVEN AN OPPORTUNITY TO CORRECT THOSE DEFICIENCIES.
E-SYSTEMS, INC., B-191346, MARCH 20, 1979, 79-1 CPD 192. AN AGENCY IS
NOT REQUIRED TO CONTINUE A COMPETITION TO PERMIT A SINGLE OFFEROR
ANOTHER CHANCE TO IMPROVE ITS PROPOSAL. SEE ELECTRONIC COMMUNICATIONS,
INC., 55 COMP.GEN. 636 (1976), 76-1 CPD 15; ILC DOVER, B-182104,
NOVEMBER 29, 1974, 74-2 CPD 301.
DESPITE ESSEX'S ASSERTIONS, THE ARMY APPEARS TO HAVE MADE EVERY
ATTEMPT TO DEAL FAIRLY WITH ESSEX UNDER THE CIRCUMSTANCES PRESENT HERE.
NOTWITHSTANDING THE EVALUATION BOARD'S RECOMMENDATION TO THE CONTRARY,
THE CONTRACTING OFFICER GAVE ESSEX THE OPPORTUNITY TO PROVIDE A REVISED
PROPOSAL, BOTH TO GENERATE COMPETITION AND TO AFFORD ESSEX THE TIME IT
SAID IN ITS INITIAL OFFER THAT IT NEEDED TO PREPARE A PROPOSAL THAT
TRULY REPRESENTED THE FIRM'S CAPABILITIES. ALSO, AT ESSEX'S INSISTENCE,
THE AGENCY DID IDENTIFY A NUMBER OF SPECIFIC DEFICIENCIES FOUND IN THE
PROPOSAL. IN THIS RESPECT, WE FIND IT INCONSEQUENTIAL THAT THE SPECIFIC
DEFICIENCIES IDENTIFIED FOR ESSEX IN ITS TELEPHONE CONVERSATION WITH THE
CONTRACT SPECIALIST (WE HAVE ACCEPTED THE ARMY'S POSITION THAT THE FIRM
ALSO WAS TOLD ITS ENTIRE OFFER WAS INADEQUATE) WERE DIFFERENT FROM THOSE
SPECIFICALLY IDENTIFIED IN THE ARMY'S NOTICE OF TECHNICAL
UNACCEPTABILITY. AS STATED ABOVE, THE NOTICE OF TECHNICAL
UNACCEPTABILITY REITERATED THAT ESSEX FAILED TO PROVIDE A COMPLETE AND
MEANINGFUL DISCUSSION OF ITS PROPOSED APPROACH TO PRODUCING AND TESTING
A GENERATOR SET THAT WOULD SATISFY THE SOLICITATION REQUIREMENTS, AND
THAT THE PROPOSAL LACKED THE NECESSARY DETAIL TO ASSURE THE EVALUATION
BOARD THAT ESSEX POSSESSED A FULL UNDERSTANDING OF THE REQUIREMENTS AND
AN AWARENESS OF THE MAGNITUDE OF THE EFFORT REQUIRED. THE NOTICE
CLEARLY STATED THAT THE SPECIFIC DEFICIENCIES IDENTIFIED IN IT WERE ONLY
EXAMPLES IN SUPPORT OF THOSE CONCLUSIONS.
IN THESE CIRCUMSTANCES, WE BELIEVE THAT THE ARMY ACTED REASONABLY IN
REJECTING ESSEX'S PROPOSAL. THE PROTEST IS DENIED.
FN1 IN THIS REGARD, ESSEX ALLEGES THAT THE OTHER PROPOSALS WERE
PROBABLY NO MORE SPECIFIC AND DETAILED THAN ITS OWN PROPOSAL. OUR
REVIEW OF THESE PROPOSALS, HOWEVER, REVEALS THAT THIS WAS NOT THE CASE.
(WE WILL NOT DISCUSS THE PROPOSALS IN DETAIL SINCE THE CONTRACTING
AGENCY IS WITHHOLDING CONTRACT AWARD PENDING OUR DECISION IN THIS CASE.)
B-210361, AUG 30, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. FOREST SERVICE, DEPARTMENT OF AGRICULTURE
APPROPRIATED FUNDS ARE AVAILABLE TO PAY ASSESSMENTS LEVIED BY
PRIVATE HOMEOWNERS' ASSOCIATION AGAINST LOT SERVICE ACQUIRED BY
DONATION UNDER AUTHORITY OF PUBLIC LAW 96-585. ASSESSMENTS ARE
ENFORCIBLE AGAINST THE UNITED STATES AS COVENANTS RUNNING WITH THE
LAND WHERE ASSUMPTION OF OBLIGATION TO PAY IS NECESSARY CONDITION
FOR ACQUISITION OF LOT.
2. DOCTRINE BASED ON THE SUPREMACY
CLAUSE OF THE UNITED STATES CONSTITUTION, ARTICLE IV CLAUSE 2,
THAT FEDERAL AGENCIES ARE EXEMPT FROM PAYING ASSESSMENTS LEVIED BY
STATE AND LOCAL GOVERNMENTAL AUTHORITIES DOES NOT PRECLUDE THE
FOREST SERVICE, DEPARTMENT OF AGRICULTURE FROM PAYING PRIVATE
HOMEOWNERS' ASSOCIATION ASSESSMENTS ON LOT ACQUIRED THROUGH
DONATION. DID NOT VIOLATE ANTIDEFICIENCY ACT PROVISION, 31 U.S.C.
SEC. 1341(A)(1)(B) BY ACCEPTING TITLE TO PROPERTY SUBJECT TO
FUTURE HOMEOWNER ASSOCIATION ASSESSMENTS. PROVISION PROHIBITS
OBLIGATIONS IN ADVANCE OF APPROPRIATIONS. NO VIOLATION OCCURRED
3. FOREST SERVICE, DEPARTMENT OF AGRICULTURE
BECAUSE SERVICE'S APPROPRIATION, CONSERVATION FUND, PUBLIC LAW
97-100, 97TH CONG., 1ST SESS., 95 STAT. 1391, 1406 (1981) WAS MADE
AVAILABLE FOR ASSESSMENT PAYMENTS, AND ITS APPROPRIATION FOR LAND
ACQUISITION WAS ENACTED BEFORE SERVICE TOOK TITLE TO PROPERTY.
4. 31 U.S.C. SEC. 3324(B) (FORMERLY 31
U.S.C. SEC. 529 (1976)) (ADVANCE PAYMENT PROHIBITION) PROHIBITS
FOREST SERVICE TO BE DERIVED FROM THE LAND AND WATER DEPARTMENT OF
AGRICULTURE FROM PAYING IN ONE LUMP SUM THE CAPITALIZED VALUE OF
HOMEOWNERS' ASSOCIATION ASSESSMENTS AGAINST A LOT THE SERVICE
ACQUIRED BY DONATION. ASSESSMENTS ARE USED TO MAINTAIN AND
IMPROVE LOT HOLDERS' (INCLUDING UNITED STATES) COMMONLY HELD
PROPERTY AND ARE ASSESSED ANNUALLY IN AMOUNTS DETERMINED TO BE
NECESSARY. BY PAYING ASSESSMENTS IN LUMP SUM, FOREST SERVICE
WOULD BE PAYING FOR SERVICES BEFORE PAYMENT IS DUE AND IN AN
AMOUNT NOT YET DETERMINED TO BE NECESSARY. ADVANCE PAYMENT
PROHIBITION DOES NOT, HOWEVER, PRECLUDE THE SERVICE FROM PAYING
THE ANNUAL ASSESSMENTS WHEN DUE SINCE, LIKE ALL OTHER OWNERS, THE
FOREST SERVICE COULD NOT HAVE ACQUIRED THE LOT WITHOUT ASSUMING
THIS OBLIGATION.
FOREST SERVICE - AVAILABILITY OF APPROPRIATED FUNDS FOR PAYMENT OF
TAHOE KEYS PROPERTY OWNERS' ASSOCIATION ASSESSMENTS:
THIS RESPONDS TO A REQUEST FROM A CERTIFYING OFFICER OF THE FOREST
SERVICE, DEPARTMENT OF AGRICULTURE FOR OUR ANSWERS TO QUESTIONS
CONCERNING THE PAYMENT OF ANNUAL ASSESSMENTS LEVIED AGAINST A GOVERNMENT
OWNED LOT BY THE TAHOE KEYS PROPERTY OWNERS ASSOCIATION. THE ISSUE IS
WHETHER APPROPRIATED FUNDS ARE AVAILABLE TO PAY THE ASSESSMENTS, OR
ALTERNATIVELY, WHETHER THE SERVICE COULD PAY THE CAPITALIZED VALUE OF
THE ASSESSMENTS IN ONE LUMP SUM.
FOR THE REASONS DISCUSSED BELOW, WE CONCLUDE THAT APPROPRIATED FUNDS
ARE AVAILABLE TO PAY THE ASSESSMENTS BUT THAT THE FOREST SERVICE SHOULD
PAY THEM WHEN DUE RATHER THAN PAYING THEIR CAPITALIZED VALUE TO THE
ASSOCIATION.
BACKGROUND
ON DECEMBER 23, 1980, CONGRESS ENACTED THE SO-CALLED BURTON-SANTINI
ACT, (ACT) PUBLIC LAW 96-586, 94 STAT. 3381, IN PART TO PROVIDE FOR THE
ACQUISITION OF CERTAIN ENVIRONMENTALLY SENSITIVE LANDS IN THE LAKE TAHOE
BASIN, CALIFORNIA, TO PREVENT THE ENVIRONMENTAL QUALITY OF THE BASIN
FROM BEING SERIOUSLY JEOPARDIZED BY OVERDEVELOPMENT. PUB.L. NO. 96-586
SEC. 1(A)(4), (B); 3(A)(1) PROVIDES:
"THE SECRETARY OF AGRICULTURE IS AUTHORIZED
TO ACQUIRE BY DONATION, PURCHASE WITH
DONATED OR APPROPRIATED FUNDS, OR OTHERWISE,
LANDS AND INTERESTS IN LANDS WHICH ARE UNIMPROVED
AS OF THE DATE OF ENACTMENT OF THE
ACT *** AND WHICH ARE ENVIRONMENTALLY SENSITIVE
LANDS ***." 94 STAT. 3383 (1980).
PURSUANT TO THIS AUTHORITY, THE UNITED STATES THROUGH THE FOREST
SERVICE ACQUIRED TITLE TO AN UNIMPROVED LOT IN THE MT. TALLAC VILLAGE
UNIT 3 IN EL DORADO COUNTY, CALIFORNIA, BY DONATION IN DECEMBER 1981.
THE LOTS IN THE VILLAGE ARE SUBJECT TO THE PROVISIONS OF A DECLARATION
OF PROTECTIVE RESTRICTIONS WHICH WAS RECORDED IN THE EL DORADO COUNTY
RECORDERS OFFICE AT THE TIME THE FOREST SERVICE ACQUIRED LOT 37. THE
DECLARATION PROVIDES THAT CERTAIN CHARGES AND ASSESSMENTS MAY BE LEVIED
AGAINST ALL LOT OWNERS AND THAT EVERY PERSON WHO ACQUIRES TITLE TO A LOT
WITHIN THE VILLAGE, "*** SHALL BY SUCH ACT BE CONCLUSIVELY DEEMED TO
HAVE CONSENTED AND AGREED TO PAY ALL CHARGES AND ASSESSMENTS. "IT
FURTHER PROVIDES THAT, "ALL OF SAID LIMITATIONS, COVENANTS, RESTRICTIONS
AND CONDITIONS WHICH INCLUDES THE DUTY TO PAY ASSESSMENTS SHALL RUN WITH
THE REAL PROPERTY AND SHALL BE BINDING UPON AND BE FOR THE BENEFIT OF
ALL PARTIES HAVING OR ACQUIRING ANY RIGHT, TITLE OR INTEREST IN THE
SUBDIVISION OR ANY PART THEREOF." THE ASSOCIATION USES THE ASSESSMENTS
TO IMPROVE AND MAINTAIN THE VILLAGE'S COMMONLY HELD AREAS AND
FACILITIES, PAY TAXES AND GENERALLY FURTHER THE LOT OWNERS' COLLECTIVE
INTERESTS.
THE TAHOE KEYS HOME OWNERS ASSOCIATION, A CALIFORNIA NONPROFIT
CORPORATION MADE UP OF ALL LOT OWNERS, LEVIES THE ASSESSMENTS ANNUALLY
WHICH CONSTITUTE LIENS AGAINST THE LOTS SUBJECT TO THE RESTRICTIONS.
THE DECLARATION EMPOWERS THE ASSOCIATION TO ENFORCE THE LIENS EITHER BY
A COLLECTION ACTION OR BY A FORECLOSURE SUIT.
ATTORNEYS FOR THE ASSOCIATION HAVE FORMALLY DEMANDED THAT THE FOREST
SERVICE PAY A DELINQUENT ANNUAL ASSESSMENT. THE FOREST SERVICE IS
WITHHOLDING PAYMENT PENDING OUR DECISION.
THE QUESTIONS
Q. 1.A. "DID THE FOREST SERVICE HAVE THE AUTHORITY TO ACCEPT TITLE
TO THE PROPERTY, SINCE EXCEPTION 5 OF SCHEDULE B OF THE POLICY OF TITLE
INSURANCE CREATES A BINDING OBLIGATION AGAINST THE GOVERNMENT FOR THE
PAYMENT OF MONIES IN ADVANCE OF APPROPRIATIONS? THIS APPEARS TO BE A
VIOLATION OF 31 U.S.C. SEC. 665 NOW 31 U.S.C. SEC. 1341(A)(1)(B) AND WE
FIND NO AUTHORITY IN PUBLIC LAW 96-586 THAT WOULD PERMIT SUCH
ACCEPTANCE.
A. 1(A). THE STATUTE WHICH THE FOREST SERVICE'S QUESTION REFERS TO,
A PROVISION OF THE SO-CALLED "ANTIDEFICIENCY ACT," PROVIDES THAT AN
OFFICER OR EMPLOYEE OF THE UNITED STATES GOVERNMENT MAY NOT INVOLVE THE
GOVERNMENT IN A CONTRACT OR OBLIGATION FOR THE PAYMENT OF MONEY BEFORE
AN APPROPRIATION IS MADE FOR THAT PURPOSE UNLESS OTHERWISE AUTHORIZED BY
LAW. THE PROVISION IS DIRECTED TOWARD PREVENTING AGENCY OFFICIALS WHO
DO NOT HAVE FUNDS ON HAND FOR A PARTICULAR PURPOSE FROM COMMITTING THE
UNITED STATES TO MAKE PAYMENTS AT SOME FUTURE TIME FOR THAT PURPOSE AND
THEREBY, IN EFFECT, COERCING THE CONGRESS INTO MAKING AN APPROPRIATION
TO COVER THE COMMITMENT. THUS, THE PROVISION GENERALLY PROHIBITS AN
OFFICIAL FROM COMMITTING THE GOVERNMENT TO MAKE PAYMENTS BEFORE CONGRESS
HAS ENACTED AN APPROPRIATION WHICH IS AVAILABLE FOR THEM.
THE SERVICE QUESTIONS WHETHER IT VIOLATED THE ACT BY ACCEPTING TITLE
TO LOT 37 BECAUSE THE ACCEPTANCE MADE THE GOVERNMENT RESPONSIBLE TO PAY
THE HOMEOWNERS' ASSOCIATION'S ANNUAL ASSESSMENTS. UNDER CALIFORNIA LAW,
THE ASSOCIATION'S RIGHT TO RECEIVE ASSESSMENT PAYMENTS IS ENFORCEABLE AS
A COVENANT RUNNING WITH THE LAND OR AS AN EQUITABLE SERVITUDE. CAL.
CIVIL CODE SECS. 1460-68 (DEERING 1971), ANTHONY ET AL. V. BREA
GLENBROOK CLUB, 130 CAL. RPTR. 32 (1976). THE UNITED STATES BECOMES
OBLIGATED TO PERFORM A COVENANT RUNNING WITH THE LAND JUST AS ANY OTHER
OWNER DOES WHEN IT ACCEPTS A DEED WITH NOTICE OF THE COVENANT. SEE
MISSISSIPPI STATE HIGHWAY COMMISSION V. COHN, 217 SO. 2D 528 (1969).
THUS, THE FOREST SERVICE BECAME BOUND TO PAY THE ASSESSMENTS WHEN IT
BECAME THE LOT'S OWNER.
THE SERVICE DID NOT VIOLATE THE ANTIDEFICIENCY ACT BECAUSE IT
ACQUIRED LOT 37 AFTER CONGRESS ENACTED THE APPROPRIATION WHICH IS
AVAILABLE FOR THE ASSESSMENT PAYMENTS. THE SERVICE ACQUIRED THE LOT ON
DECEMBER 29, 1981, AS NOTED ABOVE. THE SERVICE'S APPROPRIATION WHICH IS
AVAILABLE FOR THE ASSESSMENT PAYMENTS - THAT IS, ITS APPROPRIATION FOR
LAND ACQUISITION TO BE DERIVED FROM THE LAND AND WATER CONSERVATION FUND
- WAS MADE ON DECEMBER 23, 1981. PUBLIC LAW 97-100, 97TH CONG., 1ST
SESS., 95 STAT 1391, 1406 (1981). (SEE OUR ANSWER TO QUESTION 3 FOR A
DISCUSSION OF THE BASIS OF THIS APPROPRIATION'S AVAILABILITY.)
ACCORDINGLY, THE SERVICE DID NOT VIOLATE 31 U.S.C. SEC. 1341(A)(1)(B) BY
TAKING TITLE TO LOT 37 SUBJECT TO HOMEOWNERS' ASSOCIATION ASSESSMENTS.
Q. 1(B). WOULD THE FOREST SERVICE HAVE AUTHORITY TO PAY IN ONE LUMP
SUM THE CAPITALIZED VALUE OF THE ANNUAL ASSESSMENT AS IF IT WERE
ACQUIRING THE SUBDIVISION LAND BY CONDEMNATION?
A. 1(B). NO. THE SERVICE MAY NOT PAY THE CAPITALIZED VALUE OF THE
ANNUAL ASSESSMENTS IN ONE LUMP SUM.
UNLIKE THE DUTY TO PAY THE ASSESSMENTS ANNUALLY, THE LAW DOES NOT
REQUIRE THE SERVICE TO MAKE A LUMP SUM PAYMENT. AS EXPLAINED IN OUR
ANSWER TO QUESTION 1, THE SERVICE IS BOUND BY THE PROVISIONS OF THE
ASSOCIATION'S DECLARATION OF COVENANTS AND RESTRICTIONS BECAUSE THEY ARE
ENFORCIBLE AS COVENANTS RUNNING WITH THE LAND. THE DECLARATION REQUIRES
THAT LOT OWNERS PAY THE ASSESSMENTS AS THE ASSOCIATION LEVIES THEM.
SINCE THE ASSOCIATION LEVIES THE ASSESSMENTS ANNUALLY, THE SERVICE IS
REQUIRED TO PAY THEM ANNUALLY IN PERFORMANCE OF COVENANT RUNNING WITH
THE LAND. HOWEVER, SINCE THE ASSOCIATION DOES NOT REQUIRE A LUMP SUM
PAYMENT, THE SERVICE IS NOT BOUND BY LAW TO MAKE ONE.
IT SHOULD NOT EXTINGUISH ITS ASSESSMENT LIABILITY WITH A LUMP SUM
PAYMENT BECAUSE THAT MIGHT RESULT IN ITS EXPENDING MORE THAN IT WOULD
ULTIMATELY HAVE TO PAY IF IT HAD WAITED FOR THE DETERMINATION OF THE
AMOUNT NEEDED BY THE ASSOCIATION TO BE MADE IN THE COURSE OF ITS ANNUAL
BUDGET SETTING AND ASSESSMENT PROCEDURES. THE LUMP SUM PAYMENT AMOUNT
WOULD BE BASED UPON THE ASSUMPTION THAT FUTURE ASSESSMENTS WOULD BE
APPROXIMATELY THE SAME AS THE CURRENT AMOUNT. IT IS POSSIBLE THAT THE
ASSOCIATION WILL REDUCE FUTURE ANNUAL ASSESSMENTS AS THE TAHOE KEYS
DEVELOPMENT BECOMES ESTABLISHED. THUS, A LUMP SUM PAYMENT BASED UPON A
CONSTANT ASSESSMENT RATE COULD RESULT IN THE SERVICE'S MAKING TOO GREAT
AN EXPENDITURE. IN ANY CASE, WE BELIEVE A LUMP SUM PAYMENT IS
INADVISABLE BECAUSE DETERMINING A FIGURE WHICH ACCURATELY REFLECTS THE
CAPITALIZED VALUE OF ANNUAL ASSESSMENTS IS VIRTUALLY IMPOSSIBLE IN VIEW
OF THE FACT THAT THE AMOUNT OF ASSESSMENTS THE ASSOCIATION WILL MAKE IN
FUTURE YEARS IS UNCERTAIN.
MOREOVER, WE THINK THE SERVICE MIGHT BE VIOLATING 31 U.S.C. SEC.
3324 (FORMERLY 31 U.S.C. SEC. 529 (1976)) IF IT PAID THE CAPITALIZED
VALUE OF THE ASSESSMENTS IN ONE LUMP SUM SINCE IT HAS NO LEGAL
OBLIGATION TO PAY ANYTHING IN ADVANCE OF THE DUE DATE OF EACH
ASSESSMENT.
31 U.S.C. SEC. 3324(B) GENERALLY PROHIBITS AGENCIES FROM PAYING FOR
GOODS OR SERVICES IN ADVANCE OF RECEIVING THEM. WHILE IT IS TRUE THAT
EVEN A PAYMENT OF THE ANNUAL ASSESSMENT MIGHT BE STRICTLY CONSTRUED AS A
VIOLATION OF THE ADVANCE PAYMENT PROHIBITION SINCE THE MAINTENANCE,
IMPROVEMENT, AND OTHER SERVICES PROVIDED BY THE ASSOCIATION ARE
GENERALLY RENDERED AFTER THE ASSESSMENT IS COLLECTED, WE DO NOT THINK IT
IS NECESSARY TO LOOK BEHIND THE ASSESSMENT TO THE SPECIFIC USES TO WHICH
THE GOVERNMENT'S SHARE OF THE ASSESSMENT FUNDS WILL BE PUT. AS
DISCUSSED BEFORE, PAYMENT OF THE ASSESSMENT WHEN DUE REPRESENTS
LIQUIDATION OF A FULLY MATURE OBLIGATION. THE GOVERNMENT IS REQUIRED TO
PAY ON THE DUE DATE OF EACH ASSESSMENT.
AS EXPLAINED IN OUR ANSWERS TO QUESTION 1, THE REQUIREMENT THAT LOT
OWNERS PAY ASSESSMENTS AS LEVIED IS A COVENANT RUNNING WITH THE LAND.
THUS, THE SERVICE COULD NOT ACQUIRE LOT 37 WITHOUT BECOMING SUBJECT TO
THE ASSESSMENT PAYMENT REQUIREMENT. TAKING TITLE TO THE LOT FURTHERS
THE PURPOSE OF PUBLIC LAW 96-586 OF ACQUIRING ENVIRONMENTALLY SENSITIVE
LANDS IN THE LAKE TAHOE BASIN. ACCORDINGLY, SINCE THE ONLY WAY THE
SERVICE COULD CARRY OUT ITS CONGRESSIONAL ACQUISITION MANDATE WITH
RESPECT TO THE LOT AT ISSUE IS TO PAY THE ASSESSMENTS WHEN DUE, WE DO
NOT CONSIDER THEM TO BE ADVANCE PAYMENTS IN VIOLATION OF 31 U.S.C. SEC.
3324.
Q. 2. "IF ACCEPTANCE OF TITLE IS PROPER, WOULD THE FOREST SERVICE
BE PROHIBITED FROM THE PAYMENT OF SUCH FEES AND ASSESSMENTS UNDER THE
GENERAL RULE OF SOVEREIGNTY OF THE UNITED STATES AGAINST PAYMENT OF
FEES, ASSESSMENTS AND TAXES?"
A. 2. NO. THE CONSTITUTIONAL DOCTRINE THAT THE FEDERAL GOVERNMENT
IS IMMUNE FROM STATE AND LOCAL TAXES APPLIES ONLY TO ASSESSMENTS LEVIED
BY STATE AND LOCAL GOVERNMENTAL AUTHORITIES. IT IS INAPPLICABLE TO
ASSESSMENTS MADE BY PRIVATE ASSOCIATIONS, SUCH AS TAHOE KEYS. THE BASIS
OF THE DOCTRINE THAT THE UNITED STATES HAS SOVEREIGN IMMUNITY FROM STATE
TAXATION IS THE SUPREMACY CLAUSE OF THE CONSTITUTION. (ART. IV, CL.
2). SEE MCCULLOCH V. MARYLAND, 17 U.S. 316 (1819). THE SUPREMACY
CLAUSE PRECLUDES THE STATES FROM INTERFERING WITH THE FEDERAL
GOVERNMENT'S EXERCISE OF THE POWERS WHICH THE CONSTITUTION GIVES IT.
STATE TAXATION OF FEDERAL PROPERTY CONSTITUTES SUCH UNCONSTITUTIONAL
INTERFERENCE. UNITED STATES V. ALLEGHENY COUNTY, 322 U.S. 174 (1944).
THE DOCTRINE THAT THE FEDERAL GOVERNMENT IS IMMUNE FROM STATE TAXATION
GENERALLY INCLUDES DIRECT ASSESSMENTS BY STATE AUTHORITIES ON THE UNITED
STATES FOR LOCAL IMPROVEMENTS BECAUSE SUCH ASSESSMENTS ARE INVOLUNTARY
EXACTIONS. THEY AMOUNT TO TAXES WHICH THE UNITED STATES IS NOT REQUIRED
TO PAY. 27 COMP.GEN. 20 (1947), B-184146, AUGUST 20, 1975.
THE SOVEREIGN IMMUNITY DOCTRINE, BASED ON THE SUPREMACY CLAUSE, DOES
NOT APPLY TO THE TAHOE KEYS ASSESSMENTS, HOWEVER, BECAUSE A PRIVATE
ENTITY - NOT A STATE - LEVIES THEM. THEY ARE NOT INVOLUNTARY TAXES
ARISING FROM THE STATUTORY EXERCISE OF STATE POWER, BUT CONTRACT
OBLIGATIONS WHICH RUN WITH THE LAND ACQUIRED BY THE GOVERNMENT.
Q. 3. "IF THE FOREST SERVICE IS NOT IMMUNE FROM THE FEES AND
ASSESSMENTS, WHAT APPROPRIATION IS AVAILABLE TO US TO MAKE PAYMENT?"
A. 3. THE PAYMENT OF ASSESSMENTS TO THE ASSOCIATION IS A NECESSARY
EXPENSE OF CARRYING OUT THE PURPOSES OF SUBPARAGRAPH 3(A)(1) OF PUBLIC
LAW 96-586, I.E., THE ACQUISITION OF ENVIRONMENTALLY SENSITIVE LANDS.
THEY ARE THEREFORE, PAYABLE FROM APPROPRIATIONS FROM THE LAND AND WATER
CONSERVATION FUND WHICH SECTION 3, QUOTED SUPRA, AUTHORIZES.
WHEN CONGRESS AUTHORIZES A PARTICULAR ACTIVITY AND APPROPRIATES FUNDS
THEREFOR, BY IMPLICATION IT CONFERS AUTHORITY TO INCUR EXPENSES WHICH
ARE NECESSARY OR INCIDENT TO THE PROPER CONDUCT OF THE ACTIVITY. 6
COMP.GEN. 619, 621 (1927). TO BE CONSIDERED A NECESSARY OR INCIDENTAL
EXPENSE, AN EXPENDITURE MUST CONTRIBUTE TO, OR DIRECTLY RESULT FROM, THE
EXECUTION OF AN AUTHORIZED AGENCY FUNCTION.
THE FOREST SERVICE'S ASSESSMENT LIABILITY RESULTS DIRECTLY FROM
CARRYING OUT ITS CONGRESSIONAL MANDATE TO ACQUIRE ENVIRONMENTALLY
SENSITIVE LAND IN THE LAKE TAHOE BASIN. THE DUTY TO PAY ASSESSMENTS
AROSE "AUTOMATICALLY" UPON THE SERVICE'S ACCEPTANCE OF THE DONATION OF
LOT 37, PURSUANT TO ITS SECTION 3(A)(1) AUTHORITY. ACCORDINGLY, THE
ASSESSMENT PAYMENTS ARE EXPENSES NECESSARILY INCURRED AS AN INCIDENCE OF
ACQUIRING THE PROPERTY IN QUESTION, PURSUANT TO THE AUTHORITY OF SECTION
3(A)(1) OF PUBLIC LAW 96-586. FUNDS APPROPRIATED FOR SUCH ACQUISITIONS,
THEREFORE, ARE AVAILABLE TO PAY THE ASSOCIATION.
FUNDS FOR SECTION 3(A)(1) ACQUISITIONS ARE APPROPRIATED ANNUALLY FROM
THE LAND AND WATER CONSERVATION FUND. SECTION 3(A)(1) PROVIDES THAT,
"THE FUNDS USED FOR ACQUISITION OF SUCH LANDS AND INTEREST IN LANDS
SHALL BE THE FUNDS TO BE APPROPRIATED PURSUANT TO THIS ACT ***." SECTION
3(G) AUTHORIZES FUNDS TO BE APPROPRIATED FROM THE LAND AND WATER
CONSERVATION FUND FOR THE ACT'S PURPOSES. FOR FISCAL YEAR 1982, PUBLIC
LAW 97-100 APPROPRIATES FUNDS "*** FOR ACQUISITION OF AND OR WATERS, OR
INTEREST THEREIN, IN ACCORDANCE WITH STATUTORY AUTHORITY APPLICABLE TO
THE UNITED STATES FOREST SERVICE *** TO BE DERIVED FROM THE LAND AND
WATER CONSERVATION FUND, TO REMAIN AVAILABLE UNTIL EXPENDED." 95 STAT.
1391, AT 1406 (DECEMBER 23, 1981). IT IS CLEAR FROM THE LANGUAGE OF THE
2 QUOTED PROVISIONS READ TOGETHER THAT THIS APPROPRIATION IS THE ONE
WHICH IS AVAILABLE FOR SECTION 3(A)(1) ACQUISITIONS. ACCORDINGLY, SINCE
THE ASSESSMENT LIABILITY IN QUESTION AROSE INCIDENT TO AN ACQUISITION,
THE SERVICE SHOULD USE APPROPRIATED FUNDS DERIVED FROM THE LAND AND
WATER CONSERVATION FUND WHICH WERE PROVIDED BY PUBLIC LAW 97-100 WITHOUT
FISCAL YEAR LIMITATION TO MAKE PAYMENTS TO THE ASSOCIATION.
B-210358, JUL 21, 1983, OFFICE OF GENERAL COUNSEL
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
THE HONORABLE G. RAY ARNETT, ASSISTANT SECRETARY FOR FISH AND
WILDLIFE AND PARKS, U.S. DEPARTMENT OF THE INTERIOR:
YOU REQUEST RELIEF ON BEHALF OF CLASS D CASHIER, JAMES W. HUSKEY AND
OTHERS FOR A MONEY LOSS SUFFERED IN THE EARLY MORNING HOURS OF SATURDAY,
APRIL 17, 1982, RESULTING FROM A PRESUMED BURGLARY OF A SAFE AT CADES
COVE CAMPGROUND, GREAT SMOKEY MOUNTAINS NATIONAL PARK, TENNESSEE. WE
ARE RETURNING THIS MATTER FOR YOUR FURTHER ADMINISTRATIVE ACTION AS
DISCUSSED BELOW.
AT 2:00 A.M. ON APRIL 17, PARK RANGERS RESPONDED TO A FIRE IN A
BUILDING CONTAINING PARK RECORDS AND A SAFE. THE FIRE TOTALLY DESTROYED
THE BUILDING AND FEE COLLECTION RECORDS SUCH AS SHIFT REPORTS WITHIN IT.
WHEN THE SAFE WAS OPENED, AN ESTIMATED $2,900 WAS MISSING FROM THE
SAFE. THE NATIONAL PARK SERVICE'S REGIONAL LAW ENFORCEMENT SPECIALIST,
THE FBI, AND SECRET SERVICE WERE NOTIFIED OF THE FIRE AND LOSS OF FUNDS.
THE FBI AND THE NATIONAL PARK SERVICE OFFICIALS CONCLUDED THAT A FORCED
ENTRY INTO THE SAFE, AND ENSUING FIRE, DESTROYED EVIDENCE THAT COULD
HELP RESOLVE THE LOSS OF FUNDS. NO SUSPECT HAS BEEN DESIGNATED.
JAMES W. HUSKEY, CLASS D CASHIER, HEADQUARTERED NEAR GATLINBURG,
TENNESSEE, MADE AVAILABLE TO JUDY C. JOHNS AND JERRY LAYTON, COLLECTION
OFFICERS, $50 EACH FOR CHANGE-MAKING PURPOSES AT CADES COVE CAMPGROUND.
ACCORDING TO INFORMATION PROVIDED INFORMALLY BY DEPARTMENT OF INTERIOR
PERSONNEL FAMILIAR WITH THIS CASE BOTH OF THESE COLLECTION OFFICERS HAD
ACCESS TO THE DIAL LOCK SAFE AT CADES COVE. AT THE CLOSE OF BUSINESS ON
APRIL 16, JUDY JOHNS WAS PREPARING THE CAMPGROUND RECEIPTS FOR BANK
DEPOSIT IN ACCORDANCE WITH NATIONAL PARK SERVICE GUIDELINES. HOWEVER, A
LAW ENFORCEMENT INCIDENT IN THE PARK INTERRUPTED MS. JOHNS AND SHE WAS
UNABLE TO MAKE THE DEPOSIT. JERRY LAYTON, ANOTHER OF THE COLLECTION
OFFICERS, WHO ALSO HAD ACCESS TO THE SAFE, PLACED THE ESTIMATED $2,900
IN THE SAFE AND LOCKED IT. A TOTAL OF EIGHT PARK CASHIERS HAD ACCESS TO
THE SAFE.
YOU ASK THAT THE AMOUNT OF $100 IN CHANGE-MAKING FUNDS BE RESTORED
UNDER THE PROVISIONS OF 7 GAO 28.14(3) AND THAT THE COLLECTION OFFICERS
RESPONSIBLE FOR THE ESTIMATED $2,800 IN CAMPGROUND RECEIPTS BE RELIEVED
FROM ANY LIABILITY IN REIMBURSING THE GOVERNMENT FOR THE LOST FUNDS.
YOU STATE THE LOSS WAS NOT THE RESULT OF BAD FAITH OR LACK OF DUE CARE
ON THE PART OF MR. HUSKEY OR THE COLLECTION OFFICERS.
GAO HAS DELEGATED AUTHORITY TO AGENCY AND DEPARTMENT HEADS TO
ADMINISTRATIVELY RESOLVE CERTAIN IRREGULARITIES IN THE ACCOUNTS OF
ACCOUNTABLE OFFICERS. THIS AUTHORIZATION APPLIES TO PHYSICAL LOSSES OR
DEFICIENCIES OF LESS THAN $500. SEE 54 COMP.GEN. 112 (1974).
JUDY C. JOHNS AND JERRY LAYTON WERE THE ONLY ACCOUNTABLE OFFICERS FOR
WHOM RELIEF IS REQUESTED THAT CLEARLY WERE AT ANY TIME IN CONTROL OF
MORE THAN $500 OF GOVERNMENT FUNDS LOST AT THE CAMPGROUND. THEIR
RESPONSIBILITY FOR THESE FUNDS STEMS FROM HAVING RECEIVED THE MONEY FROM
THE OTHERS BEFORE IT WAS PLACED IN THE SAFE.
THE OTHER COLLECTION OFFICERS MAY NO LONGER HAVE BEEN ACCOUNTABLE, IF
THEY HAD TURNED THEIR RECEIPTS OVER TO A PERSON AUTHORIZED TO ASSUME
CONTROL OF THE FUNDS FROM THEM. ALSO IT IS NOT CLEAR THAT ANY OF THE
OTHER SIX COLLECTION OFFICERS EVER HAD OVER $500 IN THEIR POSSESSION.
DIVIDING THE $2,800 OF RECEIPTS BY EIGHT, THE AVERAGE COLLECTION OFFICER
RECEIVED $350 IN FEES. ADDING THE $50 CHANGE-MAKING FUNDS WOULD HAVE
RAISED TWO TOTALS TO $400. AT LEAST THREE AND POSSIBLY ALL OF THE
COLLECTION OFFICERS, THEREFORE, HAD LESS THAN $500 IN THEIR POSSESSION
WHEN THEY TURNED THEIR MONEY IN AT THE END OF THE DAY. IT WOULD SEEM TO
US POSSIBLE TO IDENTIFY WHICH OF THE COLLECTION OFFICERS HAD LESS THAN
$500 BY ANALYZING THE INFORMATION USED TO REACH THE $2,800 ESTIMATED
TOTAL OF RECEIPTS AND THE RECEIPT RECORDS FROM COMPARABLE DAYS. WE NOTE
THAT THE ESTIMATED COLLECTIONS WERE RAISED IN YOUR LETTER FROM THE
$2,600 ESTIMATE IN THE MAY 19 MEMORANDUM OF THE PARK SERVICES
ASSOCIATION REGIONAL DIRECTOR FOR ADMINISTRATION. MR. HUSKEY, WHO IS
NOT A COLLECTION OFFICER, IS ONLY INVOLVED IN $100 OF THE TOTAL LOSS.
ACCORDINGLY, MR. HUSKEY AND THOSE COLLECTION OFFICERS YOU DETERMINE
TO HAVE HAD LESS THAN $500 IN THEIR CONTROL DURING APRIL 16 SHOULD BE
RELIEVED, IF AT ALL, UNDER THE AUTHORITY DELEGATED TO YOUR AGENCY.
AS TO JUDY JOHNS AND JERRY LAYTON, WE ARE UNABLE TO GRANT RELIEF AT
THIS TIME DUE TO THE ABSENCE OF SUFFICIENT INFORMATION FOR US TO AGREE
WITH YOUR RECOMMENDATION FOR RELIEF. YOUR WRITTEN REQUEST CONTAINS NO
DETAILED INFORMATION CONCERNING THE HANDLING OF THE MONEY BY MS. JOHNS
AND MR. LAYTON. FURTHER, THERE IS NO EXPLANATION OF WHO THE PERSONNEL
WERE THAT FAILED TO FOLLOW FEE COLLECTION GUIDE PROCEDURES OR WHAT
PROCEDURE WAS SUBSTITUTED FOR THAT IN THE GUIDE. FROM THE INFORMATION
WE HAVE IT IS NOT CLEAR WHEN THE LOST MONEY SHOULD HAVE BEEN DEPOSITED
IN A BANK AND WHO WAS RESPONSIBLE FOR DOING SO. WE ALSO HAVE LEARNED
THROUGH TELEPHONE INQUIRIES THAT MS. JOHNS WAS INTERRUPTED IN HER DUTIES
WHILE PREPARING A BANK DEPOSIT RECEIPT FOR THE COLLECTIONS AND THAT MR.
LAYTON THEN PLACED THE RECEIPTS IN THE SAFE AND LOCKED IT. THERE IS NO
EXPLANATION OF THE INTERRUPTION. WE ALSO LEARNED THAT THE PARK SERVICE
REGIONAL OFFICE HAD TOLD SOMEONE AT CADES COVE TO CHANGE THE SAFE
COMBINATION WHICH HAD NOT BEEN DONE AT THE TIME OF THE FIRE AND THAT NO
ONE HAD FORMALLY BEEN DESIGNATED RESPONSIBLE FOR DEPOSITING RECEIPTS AT
THE CAMPGROUND. MOREOVER, IT IS NOT CLEAR FROM YOUR SUBMISSION WHY THE
INVESTIGATORS CONCLUDED THAT THERE WAS A BURGLARY OR WHY THEY BELIEVE IT
TOOK PLACE SHORTLY BEFORE THE FIRE WAS DISCOVERED.
IF YOU DECIDE TO SUBMIT A REQUEST FOR RECONSIDERATION, YOU SHOULD
PROVIDE US WITH INFORMATION THAT WILL CLARIFY THE FACTS SURROUNDING THE
LOSS IN QUESTION.
B-210356, JAN 11, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST ALLEGING SOLICITATION IMPROPRIETIES THAT ARE APPARENT PRIOR
TO BID OPENING MUST BE FILED BEFORE BID OPENING.
TENAVISION, INC.:
TENAVISION, INC., PROTESTS THAT THE REQUIREMENTS SET FORTH IN AN
INVITATION FOR BIDS (IFB) 83-21-C, ISSUED BY THE VETERANS
ADMINISTRATION, RESTRICT COMPETITION TO A PROPRIETARY PRODUCT. THE
PROTEST WAS FILED IN OUR OFFICE ON JANUARY 3, 1983. WE ARE INFORMED
THAT THE BID OPENING DATE WAS DECEMBER 28, 1982 AND THAT AWARD WAS MADE
ON DECEMBER 30, 1982.
WE DISMISS THE PROTEST. A PROTEST ALLEGING IMPROPRIETIES IN A
SOLICITATION THAT ARE APPARENT PRIOR TO BID OPENING MUST BE FILED EITHER
WITH THE CONTRACTING AGENCY OR OUR OFFICE BEFORE THAT TIME. 4 C.F.R.
SEC. 21.2 (B)(1)(1982). TENAVISION'S PROTEST WAS FILED AFTER BID
OPENING AND THEREFORE IS UNTIMELY. SEE D.F.FINDLEY AND COMPANY,
B-206921, AUGUST 17, 1982, 82-2 CPD 135.
THE PROTEST IS DISMISSED.
B-210353, FEB 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. CHALLENGE OF SMALL BUSINESS STATUS OF BIDDERS IS NOT CONSIDERED
BY GAO SINCE BY LAW THE MATTER IS FOR DETERMINATION BY THE SMALL
BUSINESS ADMINISTRATION.
2. PROTEST THAT NEITHER LOW NOR SECOND LOW BIDDER SUBMITTED WITH ITS
BID A LETTER DESCRIBING MAKE, MODEL AND YEAR OF VEHICLES PROPOSED TO BE
FURNISHED, INCLUDING LOCATION OF AND TELEPHONE NUMBERS OF ESTABLISHMENTS
FROM WHERE VEHICLES WOULD BE DISPATCHED, OR METERING DEVICES TO BE USED
IN DETERMINING MILEAGE, INVOLVES BIDDER RESPONSIBILITY, THE AFFIRMATIVE
DETERMINATION OF WHICH IS NOT CONSIDERED BY THE GAO EXCEPT IN
CIRCUMSTANCES NOT PRESENT HERE.
AMERICAN MEDICAL CORPORATION:
AMERICAN MEDICAL CORPORATION (AMERICAN) PROTESTS THE AWARD OF A
CONTRACT TO EITHER THE LOW OR SECOND LOW BIDDER UNDER SOLICITATION NO.
520-37-83, ISSUED BY THE VETERANS ADMINISTRATION FOR AMBULANCE SERVICES.
THE PROTESTER CONTENDS THAT NEITHER THE LOW BIDDER, HARRISON-JACKSON
COUNTY EMERGENCY SERVICES DISTRICT D/B/A AMSERV, NOR THE SECOND LOW
BIDDER, MOBIL-MEDIC AMBULANCE SERVICE OF GULFPORT, MISSISSIPPI,
QUALIFIES AS A SMALL BUSINESS CONCERN. AMERICAN ALSO CONTENDS THAT
NEITHER THE LOW NOR SECOND LOW BIDDER SUBMITTED WITH ITS BID A LETTER
DESCRIBING THE MAKE, MODEL AND YEAR OF VEHICLES PROPOSED TO BE
FURNISHED, INCLUDING THE LOCATION OF AND TELEPHONE NUMBERS OF THE
ESTABLISHMENTS FROM WHICH AVAILABLE VEHICLES WOULD BE DISPATCHED, OR THE
TYPE OF METERING DEVICES TO BE USED IN DETERMINING MILEAGE.
THE PROTEST IS DISMISSED FOR THE REASONS STATED BELOW.
UNDER 15 U.S.C. SEC. 637(B)(6) (1976), THE SMALL BUSINESS
ADMINISTRATION (SBA) IS EMPOWERED TO CONCLUSIVELY DETERMINE MATTERS OF
SMALL BUSINESS STATUS FOR FEDERAL PROCUREMENT PURPOSES. UNDER 15 U.S.
C. SEC. 634(B)(6) (1976), THE SBA HAS AUTHORITY TO MAKE SUCH RULES AND
REGULATIONS AS ARE DEEMED NECESSARY TO CARRY OUT THE AUTHORITY VESTED IN
THE SBA BY THIS LAW. IT IS THE DUTY OF SBA, NOT THIS OFFICE, TO
DETERMINE WHETHER A CONCERN IS A SMALL BUSINESS FOR PURPOSES OF A
PARTICULAR PROCUREMENT AND SBA'S DETERMINATION IS CONCLUSIVE UPON THE
PROCUREMENT AGENCY INVOLVED. SEE DOT SYSTEMS, INC., B-183697, JUNE 11,
1976, 76-1 CPD 368, AND DOT SYSTEMS, INC., B-205421, NOVEMBER 19, 1981,
82-1 CPD 38.
THE ALLEGATIONS CONCERNING THE VEHICLES TO BE USED, THE
ESTABLISHMENTS AND TELEPHONE NUMBERS FROM WHICH THE VEHICLES WOULD BE
DISPATCHED AND THE METERING DEVICES RELATE TO RESPONSIBILITY, NOT
RESPONSIVENESS. WHETHER THE BIDDERS ARE RESPONSIBLE IS A MATTER FOR
DECISION BY THE CONTRACTING OFFICER. WE WILL NOT REVIEW A PROTEST OF AN
AFFIRMATIVE DETERMINATION OF RESPONSIBILITY, WHICH IS LARGELY A BUSINESS
JUDGMENT, UNLESS THERE IS EITHER A SHOWING OF POSSIBLE FRAUD OR BAD
FAITH ON THE PART OF PROCURING OFFICIALS OR THE SOLICITATION CONTAINS
DEFINITIVE RESPONSIBILITY CRITERIA WHICH ALLEGEDLY HAVE NOT BEEN
APPLIED. PROSPECT ENTERPRISES, INC., B-206880, APRIL 8, 1982, 82-1 CPD
330; KINGSHEAD CORPORATION, B-207817, JULY 1, 1982, 82-2 CPD 10.
NEITHER EXCEPTION APPEARS TO BE APPLICABLE IN THE PRESENT CASE.
B-210352, JAN 24, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHEN PROTEST IS INITIALLY FILED WITH CONTRACTING AGENCY, SUBSEQUENT
PROTEST FILED WITH GAO MORE THAN 10 WORKING DAYS AFTER INITIAL ADVERSE
AGENCY ACTION, DENIAL OF PROTEST, IS UNTIMELY AND WILL NOT BE CONSIDERED
ON THE MERITS.
EMERGENCY BOARDING, INC.:
EMERGENCY BOARDING, INC. (EBI), PROTESTS THE UNITED STATES DEPARTMENT
OF HOUSING AND URBAN DEVELOPMENT'S (HUD) REJECTION OF ITS BIDS AS
NONRESPONSIVE TO INVITATION FOR BIDS NOS. 256-82-012, 260-82-012, AND
261-82-012. EBI CONTENDS THAT HUD'S REJECTION OF THE BIDS BECAUSE IT
SUBMITTED TERMS OF "30 DAYS NET" WAS ARBITRARY.
IN ADDITION TO ITS LETTER OF PROTEST DATED DECEMBER 27, 1982, EBI
INCLUDED A LETTER FROM HUD DATED SEPTEMBER 13, 1982. THE LETTER IS A
DENIAL OF THE PROTEST EBI FILED WITH THE AGENCY. HUD REJECTED THE BIDS
ON THE BASIS THAT THE BIDDER IMPOSED CONDITIONS WHICH WOULD MODIFY
REQUIREMENTS OF THE IFB OR LIMIT ITS LIABILITY TO THE GOVERNMENT SO AS
TO GIVE IT AN ADVANTAGE OVER THE OTHER BIDDERS. IT ALSO POINTED OUT
THAT EBI WAS NOT THE LOW BIDDER UNDER ONE OF THE IFB'S
SINCE EBI WAS NOT THE LOW BIDDER UNDER THE ONE IFB, WHETHER ITS BID
WAS IMPROPERLY REJECTED IS ACADEMIC SINCE EBI WOULD NOT BE ENTITLED TO
AWARD IN ANY EVENT.
WITH REGARD TO THE OTHER IFB'S, THE PROTEST IS UNTIMELY. SECTION
21.2(A) OF OUR BID PROTEST PROCEDURES, 4 C.F.R. PART 21 (1982), REQUIRES
THAT WHEN A PROTEST IS INITIALLY FILED WITH THE CONTRACTING AGENCY, A
SUBSEQUENT PROTEST TO OUR OFFICE MUST BE FILED WITHIN 10 WORKING DAYS OF
KNOWLEDGE OF THE INITIAL ADVERSE AGENCY ACTION. EDRON, INC., B-207353,
JUNE 9, 1982, 82-1 CPD 557. EBI'S RECEIPT OF HUD'S SEPTEMBER 13 LETTER
DENYING ITS PROTEST CONSTITUTED KNOWLEDGE OF ADVERSE AGENCY ACTION.
THEREFORE, EVEN THOUGH EBI DOES NOT STATE WHEN IT RECEIVED THE LETTER,
IT IS REASONABLE TO ASSUME THE PROTEST RECEIVED IN OUR OFFICE 3 MONTHS
LATER IS UNTIMELY.
ACCORDINGLY, THE PROTEST IS DISMISSED.
B-210351, MAY 10, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
TRANSFERRED EMPLOYEE MAY NOT BE REIMBURSED FOR A STATE GRANTOR'S TAX
PAID BY HIM ON BEHALF OF A SELLER IN CONNECTION WITH THE PURCHASE OF A
NEW RESIDENCE. ALTHOUGH IT MAY BE COMMON FOR A BUYER TO PAY THE
GRANTOR'S TAX, THE LOCAL HUD OFFICE HAS DETERMINED THAT IT IS CUSTOMARY
FOR THE SELLER TO PAY SUCH COST IN THAT PARTICULAR AREA.
CHRISTOPHER S. WERNER - REIMBURSEMENT FOR REAL ESTATE EXPENSES:
BY SUBMISSION DATED DECEMBER 13, 1982, LIEUTENANT COLONEL WILLIAM F.
MALLETT, CHIEF, PAY AND TRAVEL SYSTEMS BRANCH, DIRECTORATE OF PLANS AND
SYSTEMS, DEPARTMENT OF THE AIR FORCE, REQUESTS AN ADVANCE DECISION
CONCERNING THE CLAIM OF MR. CHRISTOPHER S. WERNER. MR. WERNER CLAIMS
REIMBURSEMENT OF THE VIRGINIA STATE GRANTOR'S TAX PAID BY HIM IN
CONNECTION WITH THE PURCHASE OF HIS NEW RESIDENCE INCIDENT TO A
PERMANENT CHANGE OF STATION. THE SUBMISSION WAS FORWARDED THROUGH THE
PER DIEM, TRAVEL AND TRANSPORTATION ALLOWANCE COMMITTEE, AND HAS BEEN
ASSIGNED PDTATAC CONTROL NO. 82-29.
THE ISSUE IS WHETHER A PURCHASER MAY BE REIMBURSED FOR REAL ESTATE
EXPENSES PAID ON BEHALF OF THE SELLER WHEN IT IS COMMON FOR THE
PURCHASER TO PAY SUCH COSTS BUT THE PRACTICE IS NOT AN ESTABLISHED
CUSTOM. THE CLAIM IS DENIED SINCE A GRANTOR'S TAX IS CUSTOMARILY PAID
BY THE SELLER.
THE VOUCHER SUBMITTED ON BEHALF OF MR. WERNER FOR $102.50 REPRESENTS
THE VIRGINIA STATE GRANTOR'S TAX WHICH IS, ACCORDING TO CODE OF VIRGINIA
SEC. 58-54.1, TO BE PAID BY THE SELLER OF REALTY. HOWEVER, THE CONTRACT
OF SALE PROVIDED THAT THIS COST WOULD BE BORNE BY THE PURCHASER. THE
CHIEF OF ACCOUNTING OPERATIONS, DEPARTMENT OF THE AIR FORCE, STATED THAT
THE ABOVE EXPENSE IS USUALLY PAID BY THE SELLER AND THEREFORE NOT
SUBJECT TO REIMBURSEMENT ON THE BASIS OF A RENEGOTIATION OF PAYMENT OF
THE TAX BETWEEN THE SELLER AND THE BUYER.
THE AUTHORITY GOVERNING THE PAYMENT BY THE GOVERNMENT OF EXPENSES
INCIDENT TO THE SALE AND PURCHASE OF RESIDENCES IS CONTAINED IN SECTION
5724A OF TITLE 5, UNITED STATES CODE (SUPP. IV 1980), AND THE
IMPLEMENTING REGULATIONS IN CHAPTER 2, PART 6, OF THE FEDERAL TRAVEL
REGULATIONS FPMR 101-7 (MAY 1973) (FTR). THESE REGULATIONS STATE A
GENERAL REQUIREMENT THAT THE EXPENSE FOR WHICH REIMBURSEMENT IS CLAIMED
IS ONE WHICH IS CUSTOMARILY BORNE IN THE TRANSACTION LOCALITY BY THE
SELLER IN THE CASE OF A SALE, OR BY THE BUYER IF INCIDENT TO THE
PURCHASE OF A RESIDENCE. FTR PARA. 2-6.2D, AND 2-6.2F.
WITH RESPECT TO THE CLAIM IN QUESTION, THE INCLUSION OF THE STATEMENT
IN THE CONTRACT OF SALE THAT "ALL OTHER CHARGES *** INCLUDING GRANTOR'S
TAX, SHALL BE PAID FOR BY PURCHASER" INDICATES THAT THE COSTS ARE
CUSTOMARILY THOSE OF THE SELLER WHICH THE BUYER IN THIS INSTANCE AGREED
TO ASSUME. THE FACT THAT THE PRACTICE OF A BUYER ASSUMING A CHARGE
NORMALLY BORNE BY THE SELLER PURSUANT TO CONTRACT IS QUITE COMMON, DOES
NOT RAISE IT TO THE STATUS OF A LOCAL CUSTOM. SEE JAMES C. STECKBECK,
B-196263, FEBRUARY 13, 1980.
THE METHOD TO BE USED IN DETERMINING WHAT THE LOCAL CUSTOM IS IN
RESPECT TO CLOSING COSTS IN A PARTICULAR AREA IS SET OUT IN FTR PARA.
2-6.3C WHICH PROVIDES IN PERTINENT PART AS FOLLOWS:
"ASSISTANCE PROVIDED BY LOCAL
OFFICES OF THE DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT. *** THE LOCAL OFFICE
WILL ALSO FURNISH UPON REQUEST INFORMATION
CONCERNING LOCAL CUSTOM AND PRACTICES WITH
RESPECT TO CHARGING OF CLOSING COSTS RELATED
TO EITHER A SALE OR PURCHASE, INCLUDING
INFORMATION AS TO WHETHER SUCH COSTS ARE CUSTOMARILY
PAID BY THE SELLER OR PURCHASER ***"
WE CONTACTED THE LOCAL HOUSING AND URBAN DEVELOPMENT (HUD) OFFICE AS
REQUIRED BY PARAGRAPH 2-6.3C OF THE FTR. WE WERE INFORMALLY ADVISED
THAT THE BURDEN OF PAYMENT OF THE GRANTOR'S TAX AS WELL AS OTHER CLOSING
EXPENSES MAY BE SHIFTED BETWEEN SELLER AND PURCHASER IN THE NORTHERN
VIRGINIA AREA PURSUANT TO A BONA FIDE CONTRACT OF SALE. MOREOVER, WE
WERE INFORMED THAT IT IS CUSTOMARY IN REAL ESTATE TRANSACTIONS IN THAT
AREA FOR THE SELLER OF THE RESIDENCE TO BEAR THE EXPENSE OF PAYMENT OF
THE GRANTOR'S TAX.
MR. WERNER CONTENDS THAT HE HAS SURVEYED SEVERAL LOCAL REAL ESTATE
AGENTS AND SETTLEMENT ATTORNEYS WHO ADVISED HIM THAT PAYMENT OF THE
GRANTOR'S TAX IS A NEGOTIABLE ITEM AND IS FREQUENTLY PAID BY THE BUYER,
ESPECIALLY IN NEW HOME PURCHASES. YET, IN THE ABSENCE OF EVIDENCE MORE
SUBSTANTIAL THAN MR. WERNER'S INFORMAL SURVEY, WE MUST HOLD THAT THE
INFORMATION PROVIDED BY HUD IS CONTROLLING AND THAT MR. WERNER MAY NOT
BE REIMBURSED FOR THE PAYMENT OF THE TAX IN QUESTION. SEE BURTON
NEWMARK, B-190715, MARCH 24, 1978.
ACCORDINGLY, FOR THE FOREGOING REASONS, MR. WERNER'S VOUCHER MAY NOT
BE CERTIFIED FOR PAYMENT.
B-210350, JAN 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
THE SMALL BUSINESS ADMINISTRATION, NOT
GAO, HAS CONCLUSIVE STATUTORY AUTHORITY
TO DETERMINE THE RESPONSIBILITY OF A
SMALL BUSINESS THAT IS FOUND NONRESPONSIBLE
BY THE CONTRACTING AGENCY AND ALSO
TO CONSIDER QUESTIONS CONCERNING A BIDDER'S
SMALL BUSINESS SIZE STATUS.
GUNDY'S TRANSFER & STORAGE:
GUNDY'S TRANSFER & STORAGE (GUNDY) PROTESTS AWARD TO AMERICAN MOVING
SERVICES, INC., THE SECOND LOW BIDDER UNDER INVITATION FOR BIDS (IFB)
DABT01-82-B-0270 ISSUED BY THE DEPARTMENT OF THE ARMY. GUNDY ALLEGES
THAT THE GOVERNMENT DID NOT "APPLY THE SAME CRITERIA OF RESPONSIBILITY"
TO AMERICAN MOVING AS IT DID TO GUNDY. MOREOVER, GUNDY ALLEGES THAT
AMERICAN MOVING IS A LARGE BUSINESS AND THUS IS INELIGIBLE FOR AWARD;
PRESUMABLY, THEREFORE, THIS PROCUREMENT IS A SMALL BUSINESS SET-ASIDE.
WE DISMISS THE PROTEST BECAUSE NONE OF THE ISSUES RAISED ARE
CONSIDERED BY OUR OFFICE UNDER OUR BID PROTEST FUNCTION. QUESTIONS
CONCERNING A FINDING THAT A FIRM IS RESPONSIBLE ARE NOT CONSIDERED BY
OUR OFFICE UNLESS EVIDENCE OF FRAUD IS PRESENTED OR THE IFB CONTAINS
DEFINITIVE CRITERIA OF RESPONSIBILITY WHICH IT IS ALLEGED WERE NOT
APPLIED. BOB MCDORMAN CHEVROLET, INC., AND JACK ROACH CADILLAC,
B-200846, B-200847, B-200847.2, B-200848, MARCH 13, 1981, 81-1 CPD 194,
AFF'D. B-200847.3, AUGUST 28, 1981, 81-2 CPD 183. NEITHER CIRCUMSTANCE
HAS BEEN SHOWN TO BE APPLICABLE HERE.
TO THE EXTENT GUNDY'S PROTEST CONCERNS THE CONTRACTING OFFICER'S
FINDING THAT IT WAS NOT A RESPONSIBLE PROSPECTIVE CONTRACTOR, WE POINT
OUT THAT THIS IS A MATTER TO BE CONSIDERED BY THE SMALL BUSINESS
ADMINISTRATION (SBA), WHICH HAS CONCLUSIVE STATUTORY AUTHORITY WITH
RESPECT TO SUCH MATTERS UNDER ITS CERTIFICATE OF COMPETENCY PROCEDURE.
DATA TRANSFORMATION CORPORATION, B-208089, AUGUST 27, 1982, 82-2 CPD
182. LIKEWISE, AMERICAN MOVING'S SMALL BUSINESS SIZE STATUS ALSO RAISES
AN ISSUE OVER WHICH THE SBA ENJOYS EXCLUSIVE STATUTORY JURISDICTION.
ALLIANCE PROPERTIES, INC., B-205253, NOVEMBER 10, 1981, 81-2 CPD 398.
THE PROTEST IS DISMISSED.
B-210349, JAN 17, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
ALLEGATION THAT CONTRACTING AGENCY TERMINATED CONTRACT FOR NO
APPARENT REASON IS NOT FOR REVIEW UNDER GAO'S BID PROTEST PROCEDURES.
THEREFORE, THE PROTEST IS DISMISSED.
FOTO TYPESETTERS, INC.:
FOTO TYPESETTERS, INC., PROTESTS THE GOVERNMENT PRINTING OFFICE'S
TERMINATION OF ITS CONTRACT FOR TYPESETTING REPORTS UNDER PROGRAM NO. B
225-S. THE PROTESTER ALLEGES THAT ITS CONTRACT (PURCHASE ORDER NO.
25412) WAS TERMINATED FOR NO APPARENT REASON.
WE WILL NOT CONSIDER THIS MATTER ON THE MERITS.
AS A GENERAL RULE, OUR OFFICE DOES NOT REVIEW AN AGENCY'S DECISION TO
TERMINATE A CONTRACT FOR THE CONVENIENCE OF THE GOVERNMENT, SINCE THIS
IS APPROPRIATELY A MATTER FOR THE BOARDS OF CONTRACT APPEALS. THE ONLY
EXCEPTION TO THIS RULE IS WHEN THE CONTRACTING AGENCY'S ACTION IS BASED
UPON A DETERMINATION THAT THE TERMINATED CONTRACT WAS IMPROPERLY
AWARDED. JACOBS & SON PAINTING AND DECORATING, B-204105, AUGUST 6, 1981,
81-2 CPD 103. NO SUCH ALLEGATION IS MADE BY FOTO TYPESETTERS, INC.
MOREOVER, OUR OFFICE DOES NOT REVIEW MATTERS RELATED TO TERMINATIONS FOR
DEFAULT. SEE ENERGY CONSERVATION UNLIMITED, INC., B-207107, APRIL 27,
1982, 82-1 CPD 395.
THE PROTEST IS DISMISSED.
B-210345, MAY 31, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE FEDERAL SUPPLY SCHEDULE IS NOT MANDATORY ON AGENCY,
CONTRACTING OFFICER IS NOT PRECLUDED FROM ISSUING IFB FOR ITEMS, AND
DETERMINATION WHETHER TO PROCEED WITH SOLICITATION IS A BUSINESS
JUDGMENT FOR THE CONTRACTING OFFICER WHICH GAO WILL NOT QUESTION ABSENT
A CLEAR SHOWING OF ABUSE OF DISCRETION.
2. PROHIBITION CONTAINED IN 41 C.F.R. SEC. 101-26.401(A) (1982),
THAT AGENCIES SHALL NOT SEEK ALTERNATE SOURCES TO FEDERAL SUPPLY
SCHEDULE (FSS), IS APPLICABLE ONLY WHERE FSS IS MANDATORY.
COLUMBIA DIAGNOSTICS, INC.:
COLUMBIA DIAGNOSTICS, INC. (CDI), PROTESTS THE DECISION OF THE
NATIONAL INSTITUTES OF HEALTH (NIH) TO AWARD CONTRACTS FOR FIVE ITEMS OF
LABORATORY GLASSWARE UNDER INVITATION FOR BIDS (IFB) NO. 263-83-B(
86)-0015.
CDI CONTENDS THAT THESE AWARDS ARE IMPROPER BECAUSE THESE CONTRACTS
ALLEGEDLY VIOLATE THE PROTESTER'S CURRENT FEDERAL SUPPLY SCHEDULE (FSS)
CONTRACT.
WE DENY THE PROTEST.
THE NIH IFB FOR MISCELLANEOUS LABORATORY GLASSWARE FOR A 12-MONTH
PERIOD BEGINNING FROM DATE OF CONTRACT AWARD WAS ISSUED ON DECEMBER 2,
1982, WITH BID OPENING ON JANUARY 3, 1983. ON DECEMBER 29, 1982, CDI
FILED A PROTEST ASSERTING THAT NIH COULD NOT LEGALLY SOLICIT BIDS FOR
FIVE OF THE 29 ITEMS SPECIFIED IN THE IFB BECAUSE THESE FIVE ITEMS WERE
COVERED BY AN EXISTING FSS CONTRACT UNDER WHICH CDI WAS THE CONTRACTOR.
CDI ALLEGED THAT IN ADDITION TO THIS FSS CONTRACT (1983 FSS), WHICH
COVERED THE PERIOD APRIL 6, 1982, TO FEBRUARY 28, 1983, THE NIH IFB WAS
ALSO INCONSISTENT WITH A GENERAL SERVICES ADMINISTRATION (GSA)
SOLICITATION ISSUED FOR FSS CONTRACTS COVERING MARCH 1, 1983, TO
FEBRUARY 28, 1984 (1984 FSS). CDI CONTENDED THAT, SINCE THE FIVE ITEMS
INVOLVED IN THIS PROTEST WERE ALREADY COVERED AND WOULD CONTINUE TO BE
COVERED BY VALID FSS MULTIPLE-AWARD CONTRACTS DURING THE CONTRACTUAL
PERIOD CONTEMPLATED BY NIH'S IFB, ANY AWARDS UNDER THE NIH IFB WERE
IMPROPER.
NIH RESPONDS THAT IT WAS NOT A MANDATORY USER AGENCY UNDER THE 1983
FSS, THAT THERE WAS NO LEGAL REQUIREMENT THAT NIH PURCHASE FROM THE
SCHEDULE, AND NIH THEREFORE COULD SOLICIT BIDS COMPETITIVELY. NIH ALSO
CONTENDS IT WAS NOT REQUIRED TO CANCEL THIS IFB BECAUSE OF THE
POSSIBILITY THAT IT COULD CONFLICT WITH THE MANDATORY 1984 FSS TO BE
AWARDED ON AN UNSPECIFIED FUTURE DATE. NIH STATES THAT IT WAS NOT
REQUIRED "BY LAW OR LOGIC" TO CURTAIL THE ACQUISTION OF NEEDED SUPPLIES
IN ANTICIPATION OF THE AWARD OF A CONTRACT BY ANOTHER EXECUTIVE AGENCY
"THE TIMING OF WHICH CAN BE NEITHER ACCURATELY PREDICTED NOR
CONTROLLED."
ON APRIL 15, 1983, GSA AWARDED AN FSS CONTRACT COVERING THESE FIVE
ITEMS. HOWEVER, THE EFFECTIVE DATES FOR THESE FSS ITEMS WERE MAY 1
AND/OR MAY 15. ON APRIL 29, 1983, PRIOR TO THE EFFECTIVE DATE OF THE
1984 FSS, NIH AWARDED CONTRACTS FOR THE FIVE ITEMS. NIH REPORTS THAT
THE PRICES IT OBTAINED ARE LOWER THAN CDI'S 1984 FSS PRICES.
CDI ARGUES THAT NIH'S ACTION WAS IMPROPER AS A MATTER OF LAW AND
CONTRARY TO THE SPIRIT UNDERLYING THE SCHEME OF FSS CONTRACTING. CDI
POINTS OUT THAT NIH WAS ON NOTICE THAT THE 1984 FSS CONTRACT HAD BEEN
AWARDED AND WITHIN 2 WEEKS WOULD BE EFFECTIVE FOR ALL FIVE ITEMS, BUT
NIH "RACED" TO AWARD UNDER ITS IFB PRIOR TO THE EFFECTIVE DATE OF THE
1984 FSS. CDI ALSO ARGUES THAT NIH IMPROPERLY COMPARED PRICES RECEIVED
UNDER THE IFB WITH THOSE UNDER THE FSS CONTRACT, A PROCEDURE IT CONTENDS
IS PROHIBITED BY THE FEDERAL PROCUREMENT REGULATIONS (FPR) GOVERNING THE
FSS.
THERE WAS NO IMPROPRIETY IN THE NIH AWARD UNDER THE IFB. OUR OFFICE
HAS STATED THAT, WHERE ITEMS ARE AVAILABLE ON A NONMANDATORY FSS, AS WAS
THE CASE HERE, A CONTRACTING OFFICER IS NOT PRECLUDED FROM ISSUING AN
IFB FOR THESE ITEMS. THE DETERMINATION WHETHER TO PROCEED WITH A
SOLICITATION IN ORDER TO OBTAIN A MORE FAVORABLE PRICE IS BASICALLY A
BUSINESS JUDGEMENT WHICH OUR OFFICE WILL NOT QUESTION ABSENT A CLEAR
SHOWING OF ABUSE OF DISCRETION. SEE AMRAY INC., B-210490, FEBRUARY 7,
1983, 83-1 CPD 135; FIRE APPARATUS SERVICE, B-192370, AUGUST 22, 1979,
79-2 CPD 142.
HERE, 16 BIDS WERE SUBMITTED IN RESPONSE TO THE IFB. LOWER PRICES
WERE OBTAINED IN COMPARISON TO BOTH THE 1983 AND 1984 FSS. THE IFB WAS
ISSUED APPROXIMATELY 4 MONTHS BEFORE AWARD WAS MADE UNDER THE MANDATORY
FSS. WE KNOW OF NO REGULATION OR DECISION WHICH REQUIRES THAT AN AGENCY
DELAY ISSUANCE OF AN IFB BECAUSE OF THE INTENDED FUTURE AWARD OF A
MANDATORY FSS CONTRACT. THUS, ALTHOUGH NIH WAS ON NOTICE AFTER THE
PROTEST THAT GSA INTENDED TO MAKE A MANDATORY FSS FOR 1984, IN OUR VIEW,
NIH WAS NOT REQUIRED TO TERMINATE ITS PROCUREMENT.
WHILE CDI ARGUES THAT NIH TOOK ADVANTAGE OF A TECHNICALITY, THE DELAY
IN THE EFFECTIVE DATE OF THE 1984 FSS, TO AWARD CONTRACTS FOR THESE
ITEMS TO AVOID USE OF THE 1984 MANDATORY FSS, NIH POINTS OUT IN ITS
REPORT THAT ITS ISSUANCE OF AN IFB WAS BASED ON ITS DECISION NOT TO
ANTICIPATE AWARD OF A CONTRACT BY GSA THE TIMING OF WHICH IT COULD NOT
PREDICT OR CONTROL AND WAS INITIATED WELL IN ADVANCE OF THE AWARD OF THE
1984 FSS. IN OUR VIEW, NIH'S DECISION TO CONDUCT A PROCUREMENT UNDER
THESE CIRCUMSTANCES AND TO AWARD CONTRACTS UNDER THE IFB, INSTEAD OF
CANCELLING THE IFB AND USING THE FSS ONCE IT BECAME EFFECTIVE, DOES NOT
CONSTITUTE AN ABUSE OF DISCRETION ON THE PART OF NIH.
CDI ALSO ARGUES THAT NIH'S PRICE COMPARISON OF THE IFB AND THE FSS
CONTRACTS IS PROHIBITED BY 41 C.F.R. SEC. 101-26.401(A) (1982), WHICH
STATES:
"*** AGENCIES SHALL NOT SOLICIT BIDS, PROPOSALS,
QUOTATIONS OR OTHERWISE TEST THE MARKET FOR THE PURPOSE
OF SEEKING ALTERNATIVE SOURCES TO FEDERAL SUPPLY
SCHEDULES. ***"
HOWEVER, THIS FPR PROVISION, OF WHICH ONLY PART IS QUOTED ABOVE,
"MERELY PROVIDES THAT AGENCIES SHALL NOT SEEK ALTERNATE SOURCES TO A
MANDATORY FEDERAL SUPPLY SCHEDULE." SEE STANLEY AND RACK, B-204565,
MARCH 9, 1982, 82-1 CPD 217. HERE, AT THE TIME NIH CONDUCTED THE PRICE
COMPARISON, NO MANDATORY FSS WAS APPLICABLE TO NIH AND, THEREFORE, NIH
DID NOT VIOLATE THIS REGULATION.
B-210342; B-210347, FEB 16, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO DOES NOT REVIEW THE ACCURACY OF WAGE RATE DETERMINATIONS
ISSUED BY THE DEPARTMENT OF LABOR IN CONNECTION WITH SOLICITATIONS
SUBJECT TO THE SERVICE CONTRACT ACT. A CHALLENGE TO A SERVICE CONTRACT
ACT WAGE DETERMINATION SHOULD BE PROCESSED THROUGH THE ADMINISTRATIVE
PROCEDURES ESTABLISHED BY THE DEPARTMENT OF LABOR.
2. INCUMBENT CONTRACTOR WHICH PREPARED BIDS BASED ON A COLLECTIVE
BARGAINING AGREEMENT WITH ITS EMPLOYEES WAS NOT PREJUDICED BY
INCONSISTENCIES BETWEEN THE DEPARTMENT OF LABOR WAGE DETERMINATION IN
THE SOLICITATIONS AND THE COLLECTIVE BARGAINING AGREEMENT. THE WAGE
DETERMINATION INCLUDED A PROVISION WHICH PUT ALL BIDDERS ON NOTICE THAT
THE WAGE DETERMINATION SPECIFIED ONLY MINIMUM WAGES AND BENEFITS AND
THAT THE CONTRACT AWARDEE WOULD BE REQUIRED TO COMPLY WITH THE
COLLECTIVE BARGAINING AGREEMENT.
GERONIMO SERVICE CO.:
GERONIMO SERVICE CO. PROTESTS A SERVICE CONTRACT ACT WAGE
DETERMINATION INCORPORATED INTO NAVY SOLICITATIONS NOS.
N62471-82-B-2183 AND N62471-82-B-2193 FOR CUSTODIAL SERVICES AT NAVY
INSTALLATIONS IN HAWAII. GERONIMO, THE INCUMBENT CONTRACTOR, COMPLAINS
THAT THE WAGE DETERMINATION ISSUED BY THE DEPARTMENT OF LABOR IS
INCONSISTENT WITH THE CURRENT COLLECTIVE BARGAINING AGREEMENT COVERING
THE EMPLOYEES INVOLVED AND WILL RESULT IN GERONIMO'S BEING UNFAIRLY
UNDERBID BY COMPETITORS UNAWARE THEY WILL BE REQUIRED TO PERFORM IN
ACCORDANCE WITH THE COLLECTIVE BARGAINING AGREEMENT. BECAUSE IT IS THE
POLICY OF THIS OFFICE NOT TO REVIEW THE CORRECTNESS OF A WAGE RATE
DETERMINATION MADE BY THE DEPARTMENT OF LABOR, THE PROTEST IS DISMISSED.
GERONIMO CONTENDS THAT THE WAGE DETERMINATION IS INCONSISTENT WITH
THE COLLECTIVE BARGAINING AGREEMENT IN SEVERAL RESPECTS, INCLUDING
MEDICAL PLAN COSTS, DENTAL PLAN COSTS, GROUP LIFE INSURANCE COSTS,
DISABILITY INSURANCE COSTS, SICK LEAVE, AND THE REQUIREMENT THAT THE
EMPLOYER FURNISH EMPLOYEE UNIFORMS.
GERONIMO ARGUES THAT IT IS PREJUDICED BY THE UNDERSTATED WAGE
DETERMINATION BECAUSE, AS THE INCUMBENT CONTRACTOR, IT MUST CALCULATE
ITS BID IN ACCORDANCE WITH THE TERMS OF THE COLLECTIVE BARGAINING
AGREEMENT. THE OTHER BIDDERS, HOWEVER, WILL BE UNAWARE OF THE
SUBSTANTIALLY HIGHER LEVEL OF FRINGE BENEFITS IN THE COLLECTIVE
BARGAINING AGREEMENT AND, AS A CONSEQUENCE, WILL UNDERBID GERONIMO.
(UNDER THE SERVICE CONTRACT ACT, SUCCESSOR CONTRACTORS GENERALLY ARE
REQUIRED TO ADHERE TO THE PREDECESSOR CONTRACTOR'S COLLECTIVE BARGINING
AGREEMENT. SEE 41 U.S.C. SEC. 353(C) (1976).)
BECAUSE THE COURTS HAVE HELD THAT A PREVAILING WAGE RATE
DETERMINATION MADE BY THE SECRETARY OF LABOR IS NOT SUBJECT TO JUDICIAL
REVIEW, THIS OFFICE DOES NOT REVIEW THE ACCURACY OF WAGE RATE
DETERMINATIONS ISSUED IN CONNECTION WITH SOLICITATIONS SUBJECT TO THE
SERVICE CONTRACT ACT. A CHALLENGE TO A SERVICE CONTRACT ACT WAGE
DETERMINATION SHOULD BE PROCESSED THROUGH THE ADMINISTRATIVE PROCEDURES
ESTABLISHED BY THE DEPARTMENT OF LABOR. PROFESSIONAL CARPET SERVICE,
B-203287, JUNE 3, 1981, 81-1 CPD 445.
IN ANY EVENT, WAGE DETERMINATION NO. 80-1232 (REV. 2) INCLUDES THE
FOLLOWING NOTE:
"IN ACCORDNACE WITH SECTION 4(C) OF THE SERVICE
CONTRACT ACT, AS AMENDED, THE WAGE RATES AND
FRINGE BENEFITS SET FORTH IN THIS WAGE DETERMINATION
ARE BASED ON A COLLECTIVE BARGAINING
AGREEMENTS UNDER WHICH THE INCUMBENT CONTRACTOR IS
OPERATING. THE WAGE DETERMINATION SETS FORTH THE
WAGE RATES AND FRINGE BENEFITS PROVIDED BY THE COLLECTIVE
BARGAINING AGREEMENT AND APPLICABLE TO
PERFORMANCE ON THE SERVICE CONTRACT. HOWEVER,
FAILURE TO INCLUDE ANY JOB CLASSIFICATION,
WAGE RATE OR FRINGE BENEFIT ENCOMPASSED
IN THE COLLECTIVE BARGAINING AGREEMENT
DOES NOT RELIEVE THE SUCCESSOR CONTRACTOR OF
THE STATUTORY REQUIREMENTS TO COMPLY AS A MINIMUM
WITH THE TERMS OF THE COLLECTIVE BARGAINING
AGREEMENT INSOFAR AS WAGES AND FRINGE BENEFITS
ARE CONCERNED." THIS PROVISION NOTIFIES ALL BIDDERS OF THEIR LEGAL
RESPONSIBILITY TO COMPLY WITH THE INCUMBENT CONTRACTOR'S COLLECTIVE
BARGAINING AGREEMENT. THE WAGE DETERMINATION ONLY SPECIFIES THE MINIMUM
WAGES AND BENEFITS TO BE PAID; IT IS EMPLOYED BY THE BIDDER AT THOSE
RATES. IN A SITUATION SUCH NOT A GUARANTEE THAT THE APPROPRIATE WORK
FORCE CAN BE AS THIS, IT IS THE RESPONSIBILITY OF THE BIDDER TO PROJECT
COSTS AND TO TAKE INTO CONSIDERATION IN ITS BID CALCULATION THE POSSIBLE
IMPACT OF A COLLECTIVE BARGAINING AGREEMENT ON ITS COST OF PERFORMANCE.
GERONIMO SERVICE CO., B-210057, JANUARY 24, 1983, 83-1 CPD ; SAFEGUARD
MAINTENANCE CORPORATION, B-198356, APRIL 23, 1980, 80-1 CPD 292. HERE,
ALL BIDDERS SHOULD HAVE BEEN AWARE OF THE COLLECTIVE BARGAINING
AGREEMENT, AND, IF THEY DESIRED, SHOULD HAVE ATTEMPTED TO LEARN THE
PRECISE WAGES AND FRINGE BENEFITS CALLED FOR BY THAT AGREEMENT. THUS,
GERONIMO SHOULD NOT HAVE BEEN AT A COMPETITIVE DISADVANTAGE AS A
CONSEQUENCE OF ITS STATUS AS THE INCUMBENT CONTRACTOR. A&CBUILDING AND
INDUSTRIAL MAINTENANCE CORPORATION - RECONSIDERATION, B-196829.2,
SEPTEMBER 18, 1980, 80-2 CPD 202.
THE PROTEST IS DISMISSED.
B-210339, APR 13, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE AGENCY'S MINIMUM NEED IS FOR A NEW C-130H AIRCRAFT, AND
ONLY A SINGLE FIRM CAN SUPPLY ONE, SOLE-SOURCE PURCHASE FROM THAT FIRM
IS JUSTIFIED.
2. AGENCY'S AWARD OF A SOLE-SOURCE CONTRACT BEFORE THE EXPIRATION OF
THE 5-DAY PERIOD PROMISED IN THE COMMERCE BUSINESS DAILY NOTICE OF THE
IMPENDING SOLE-SOURCE AWARD FOR RESPONSES FROM FIRMS INTERESTED IN
COMPETING FOR THE CONTRACT DID NOT PREJUDICE THE PROTESTER, SINCE THE
PROTESTER COULD NOT HAVE MET THE AGENCY'S NEED.
3. GAO HAS NO AUTHORITY UNDER THE FREEDOM OF INFORMATION ACT TO
DETERMINE WHAT INFORMATION MUST BE DISCLOSED BY OTHER GOVERNMENT
AGENCIES.
DAEDALUS AVIATION:
DAEDALUS AVIATION PROTESTS THE COAST GUARD'S AWARD OF A SOLE-SOURCE
CONTRACT TO LOCKHEED-GEORGIA CORPORATION FOR A NEW C-130H AIRCRAFT, WITH
ASSOCIATED DATA, TRAINING, AND FIELD SERVICE SUPPORT, NEEDED FOR THE
COAST GUARD'S SEARCH, RESCUE, AND LAW ENFORCEMENT ACTIVITIES IN ALASKA.
DAEDALUS PROTESTS THAT THE COAST GUARD AWARDED THE CONTRACT ON DECEMBER
23, 1982, EVEN THOUGH A DECEMBER 21 COMMERCE BUSINESS DAILY (CBD) NOTICE
OF THE IMPENDING NON-COMPETITIVE AWARD STATED THAT THE AGENCY WOULD
CONSIDER ANY EXPRESSIONS OF INTEREST RECEIVED WITHIN 5 DAYS FROM
PUBLICATION OF THE NOTICE. DAEDALUS APPARENTLY CAN SUPPLY USED C-130
MODELS, AND COMPLAINS THAT THE COAST GUARD DID NOT CONSIDER WHETHER THE
FIRM, WHICH RESPONDED TO THE CBD NOTICE, COULD MEET THE AGENCY'S NEEDS,
BEFORE AWARDING THE CONTRACT TO LOCKHEED.
WE DENY THE PROTEST.
THE AIRCRAFT AND RELATED MATERIALS WERE NEEDED TO REPLACE A C-130H
AIRCRAFT THAT CRASHED IN ALASKA IN JULY 1982. THE COAST GUARD REPORTS
THAT IT NORMALLY WOULD PURCHASE A NEW C-130H AIRCRAFT THROUGH THE AIR
FORCE'S MULTI-YEAR CONTRACT WITH LOCKHEED, THE ONLY C-130 MANUFACTURER.
THE COAST GUARD STATES THAT IT CONTACTED LOCKHEED DIRECTLY IN SEPTEMBER
1982, HOWEVER, TO DETERMINE WHETHER ANY C-130HS WERE AVAILABLE.
LOCKHEED ADVISED THAT IT COULD SELL THE COAST GUARD A NEW C-130H THAT
HAD BEEN CONTRACTED FOR BY ANOTHER BUYER WHO HAD BEEN UNABLE TO COMPLETE
THE PURCHASE, AT A DISCOUNT ($13.5 MILLION INSTEAD OF THE $16 MILLION
PER AIRCRAFT PAID UNDER THE AIR FORCE CONTRACT) IF THE PURCHASE WERE
COMPLETED BEFORE THE END OF 1982.
ON DECEMBER 16, THE CONTRACTING OFFICER EXECUTED A DETERMINATION AND
FINDINGS TO SUPPORT A SOLE-SOURCE CONTRACT WITH LOCKHEED FOR THE
AIRCRAFT. THE JUSTIFICATION WAS THAT LOCKHEED IS THE ONLY MANUFACTURER
OF C-130S, THE NEW C-130H IN ISSUE WAS AVAILABLE IMMEDIATELY, AND THAT
FAILURE TO MAKE THE PURCHASE WOULD CAUSE THE COAST GUARD TO PAY $16
MILLION UNDER THE AIR FORCE CONTRACT AND WAIT FOR DELIVERY IN LATE 1983.
THE PROCUREMENT WAS SYNOPSIZED IN THE CBD ON DECEMBER 21. THE CBD
NOTICE STATED THAT THE SOLE-SOURCE SOLICITATION WOULD BE ISSUED ON OR
BEFORE DECEMBER 20, AND THE AIRCRAFT, IDENTIFIED ONLY AS A C-130 (AS
OPPOSED TO A NEW C-130H) WOULD BE DELIVERED ON DECEMBER 30. THE NOTICE
ADVISED:
"*** IN THE ABSENCE OF RESPONSES FROM FIRMS
WHO HAVE THE CAPABILITY TO PERFORM THIS
REQUIREMENT, THE PROCUREMENT OFFICE PLANS TO
NEGOTIATE A CONTRACT WITH LOCKHEED CORP. ON A
NON-COMPETITIVE BASIS FOR THE AIRCRAFT. THIS
IS NOT AN RFP (REQUEST FOR PROPOSALS). YOUR
RESPONSE WILL BE CONSIDERED WHEN THE RFP IS
ISSUED. NO OTHER NOTICE WILL BE PUBLISHED
UNTIL AN AWARD IS MADE. YOUR RESPONSE MUST
BE RECEIVED WITHIN FIVE DAYS FROM DATE OF
PUBLICATION OF THIS NOTICE."
DAEDALUS RESPONDED TO THE SYNOPSIS ON DECEMBER 22 BY EXPRESSING
INTEREST IN THE PURCHASE. THE COAST GUARD AND LOCKHEED EXECUTED A
CONTRACT ON DECEMBER 23, HOWEVER, WITHOUT FIRST CONSIDERING DAEDULUS'
RESPONSE. THE FIRM THEN PROTESTED TO OUR OFFICE.
A SOLE-SOURCE AWARD IS PROPER WHERE ONLY ONE FIRM CAN MEET THE
AGENCY'S NEED. SEE ROLM INTERMOUNTAIN CORPORATION, B-206327.4, DECEMBER
22, 1982, 82-2 CPD 564. HERE, THE COAST GUARD REPORTS THAT ITS NEED
ACTUALLY WAS FOR A NEW, MODEL "H" C-130 (ALTHOUGH THE AGENCY APPARENTLY
DID NOT SEE THE NECESSITY TO SO SPECIFY IN THE DOCUMENT JUSTIFYING THE
SOLE-SOURCE ACQUISITION), SINCE THE AIRCRAFT HAD TO BE COMPATIBLE WITH
THE NEW C-130HS ALREADY ON ORDER FROM LOCKHEED UNDER THE AIR FORCE
CONTRACT. THE AGENCY ADMITS THAT IT UNFORTUNATELY FAILED TO SPECIFY IN
THE CBD NOTICE ITS NEED FOR A NEW C-130H, AND THAT IT NEGLECTED TO WAIT
THE PROMISED 5 DAYS FOR EXPRESSIONS OF INTEREST. THE AGENCY STATES,
HOWEVER, THAT SEVERAL DAYS AFTER THE AWARD TO LOCKHEED IT CONTACTED
DAEDALUS AND DETERMINED THAT THE FIRM ONLY HAD MODEL "A" C-130S
AVAILABLE IMMEDIATELY. THE COAST GUARD ARGUES THAT DAEDALUS THEREFORE
WAS NOT PREJUDICED BY THE ACTIONS COMPLAINED OF SINCE THE FIRM COULD NOT
MEET THE COAST GUARD'S NEEDS IN ANY EVENT.
DAEDALUS, WHICH CONCEDES THAT IT COULD NOT HAVE FURNISHED A NEW
C-130H (ALTHOUGH IT DENIES THAT IT HAD ONLY C-130AS AVAILABLE), HAS
GIVEN US NO REASON TO QUESTION THE COAST GUARD'S DECISION THAT ITS NEEDS
DICTATE A NEW C-130H RATHER THAN ANOTHER C-130 MODEL OR A USED AIRCRAFT.
IN THIS RESPECT, THE DETERMINATION OF THE GOVERNMENT'S MINIMUM NEEDS
AND THE BEST METHOD TO ACCOMMODATE THEM IS PRIMARILY THE RESPONSIBILITY
OF THE CONTRACTING AGENCY INVOLVED, SINCE THE AGENCY IS MOST FAMILIAR
WITH THE CONDITIONS UNDER WHICH SUPPLIES, EQUIPMENT OR SERVICES HAVE
BEEN USED IN THE PAST AND HOW THEY WILL BE USED IN THE FUTURE. S.A.F.E.
EXPORT CORPORATION, B-207655, NOVEMBER 16, 1982, 82-2 CPD 445. WE
THEREFORE WILL NOT QUESTION AN AGENCY'S DETERMINATION IN THAT RESPECT
UNLESS IT IS SHOWN TO BE UNREASONABLE. PHILIPS INFORMATION SYSTEMS,
INC., B-208066, DECEMBER 6, 1982, 82-2 CPD 506.
DAEDALUS DOES SPECULATE THAT THE PURCHASED AIRCRAFT ACTUALLY MAY BE A
USED C-130H, IN VIEW OF THE GENEROUS SALE PRICE TO THE COAST GUARD.
DAEDALUS ARGUES THAT IN SUCH CASE THE COAST GUARD EITHER HAS MISSTATED
ITS NEED, OR HAS PURCHASED AN AIRCRAFT THAT DOES NOT FULFILL ITS
REQUIREMENT; DAEDALUS ASSERTS THAT IF EITHER IS THE CASE, IT SHOULD
HAVE BEEN PERMITTED TO COMPETE FOR THE SALE.
THE COAST GUARD, HOWEVER, STATES THAT THE AIRCRAFT IT PURCHASED FROM
LOCKHEED IN FACT IS NEW. DAEDALUS' SPECULATION DOES NOT SUFFICE TO
CARRY THE PROTESTER'S BURDEN TO PROVE ITS CASE. SEE MUTUAL OF OMAHA
INSURANCE COMPANY, B-203338.2, SEPTEMBER 24, 1982, 82-2 CPD 268.
FINALLY, DAEDALUS REQUESTS THAT OUR OFFICE PROVIDE IT CERTAIN
INFORMATION ABOUT THE PURCHASED AIRCRAFT'S FEATURES, AND THE LOCKHEED/
COAST GUARD CONTRACT, PURSUANT TO THE FREEDOM OF INFORMATION ACT, 5 U.
S.C. SEC. 552 ET SEQ. (1976). THE INFORMATION REQUESTED, HOWEVER, IS IN
THE COAST GUARD'S POSSESSION, NOT THIS OFFICE'S, SO THAT DAEDALUS SHOULD
PURSUE DISCLOSURE UNDER THE FREEDOM OF INFORMATION ACT WITH THAT AGENCY.
IN THIS REGARD, OUR OFFICE HAS NO AUTHORITY UNDER THE STATUTE TO
DETERMINE WHAT INFORMATION MUST BE DISCLOSED BY OTHER GOVERNMENT
AGENCIES. CLAUDE E. ATKINS ENTERPRISES, INC., B-205129, JUNE 8, 1982,
82-1 CPD 553.
UNDER THE CIRCUMSTANCES, WE FIND THE COAST GUARD'S SOLE-SOURCE
PURCHASE FROM LOCKHEED WAS JUSTIFIED, SINCE THE AGENCY COULD NOT SECURE
THE NEW C-130H IT NEEDED FROM ANY OTHER SOURCE. DAEDALUS THEREFORE WAS
NOT PREJUDICED BY THE COAST GUARD'S FAILURE TO WAIT THE 5 DAYS PROMISED
IN THE CBD NOTICE BEFORE AWARDING THE CONTRACT. SEE AYDIN CORPORATION,
VECTOR DIVISION, B-188729, SEPTEMBER 6, 1977, 77-2 CPD 175.
THE PROTEST IS DENIED.
B-210338.2, SEP 27, 1983
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
THE HONORABLE HAROLD S. SAWYER, HOUSE OF REPRESENTATIVES:
THIS IS IN RESPONSE TO YOUR LETTER OF AUGUST 1, 1983, CONCERNING THE
STATUS OF CERTAIN RECESS APPOINTEES TO THE BOARD OF DIRECTORS OF THE
LEGAL SERVICES CORPORATION AND WITH RESPECT TO THE STATUS OF THE
PRESIDENT OF THAT CORPORATION.
SINCE THE MATTERS WHICH YOU ADDRESS RELATE TO THE LEGAL ANALYSIS
FURNISHED TO SEVERAL MEMBERS ON APRIL 5, 1983, B-210338, WE HAVE, WITH
CONCURRENCE FROM YOUR STAFF, ANSWERED THEM IN A SUPPLEMENT TO THAT LEGAL
ANALYSIS.
A COPY OF THAT SUPPLEMENT IS ENCLOSED. COPIES ARE ALSO BEING
FURNISHED TO RECIPIENTS OF THE ORIGINAL ANALYSIS AND CERTAIN RECIPIENTS
OF THE REPORT OF AUGUST 31, 1983, GAO/HRD-83-69.
YOUR LETTER CONTAINS OBSERVATIONS CONCERNING THE CONTRACT OF THE
PRESIDENT OF THE LEGAL SERVICES CORPORATION WHICH ARE NOT ADDRESSED IN
THE SUPPLEMENTAL LEGAL OPINION. IN ADDITION TO THE FACT THAT YOU
CHARACTERIZED THESE REMARKS AS AN OBSERVATION, WE FELT IT INAPPROPRIATE
TO COMMENT ON THAT IN THE OPINION BECAUSE THE SEVERANCE PAY PROVISIONS
OF THE CONTRACT HAVE BEEN SUPERSEDED BY THE PROVISIONS OF THE ACT OF
DECEMBER 21, 1982, UNLESS MR. BOGARD BECOMES ELIGIBLE FOR A PAYMENT
UNDER THE CONTRACT AND IS SUCCESSFUL IN ENFORCING THE CONTRACT IN COURT.
WE DO AGREE WITH YOUR OBSERVATION THAT THE SUPERSEDED CONTRACT CLAUSES
GIVE UNUSUALLY FAVORABLE SEVERANCE BENEFITS.
WE TRUST THAT THIS RESPONSE WILL SERVE THE PURPOSE OF YOUR INQUIRY.
B-210336, JAN 13, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
TEN-DAY PERIOD FOR FILING PROTESTS AFTER BASIS FOR PROTEST IS KNOWN
OR SHOULD HAVE BEEN KNOWN BY PROTESTER IS NOT TOLLED BY PROTESTER'S
SUBSEQUENT EFFORTS TO CONVINCE AGENCY THAT THE SOLE-SOURCE AWARD OF A
CONTRACT TO ANOTHER FIRM WAS IMPROPER.
THE HELICON GROUP, LTD.:
THE HELICON GROUP, LTD. PROTESTS THE SOLE-SOURCE AWARD OF A CONTRACT
BY THE FEDERAL EMERGENCY MANAGEMENT AGENCY FOR AN EVALUATION STUDY OF
THE NATIONAL FLOOD INSURANCE PROGRAM. HELICON CONTENDS THAT BECAUSE IT
AND OTHERS HAD THE QUALIFICATIONS TO PERFORM THE STUDY, THERE WAS NO
VALID BASIS TO SUPPORT THE AGENCY'S DETERMINATION THAT THE AWARDEE WAS
UNIQUELY QUALIFIED. FOR THE REASONS DISCUSSED BELOW, THIS PROTEST IS
DISMISSED AS UNTIMELY UNDER OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC.
21.2 (1982).
HELICON SUBMITTED WITH ITS PROTEST CORRESPONDENCE WHICH INDICATES THE
AGENCY ANNOUNCED ITS INTENTION TO MAKE A SOLE-SOURCE AWARD IN THE MAY
14, 1982 ISSUE OF THE COMMERCE BUSINESS DAILY AND THAT HELICON
TELEPHONED THE AGENCY ON MAY 19 TO PROTEST. SUBSEQUENTLY, THERE WERE
SEVERAL EXCHANGES OF CORRESPONDENCE. WHILE IT IS NOT CLEAR WHETHER THE
AGENCY CONSIDERED HELICON'S OBJECTIONS AS A FORMAL PROTEST, BY LETTERS
DATED AUGUST 25 AND SEPTEMBER 22 THE AGENCY MADE IT CLEAR IT DID NOT
INTEND TO DISTURB THE AWARD AS A RESULT OF HELICON'S OBJECTIONS.
ALTHOUGH ON SEPTEMBER 8 AND AGAIN ON OCTOBER 1 HELICON ADVISED THE
AGENCY THAT IT WAS PROTESTING TO OUR OFFICE, IT DID NOT ACTUALLY DO SO
UNTIL DECEMBER 28, 1982.
SECTION 21.2(B)(1) OF OUR PROCEDURES REQUIRES PROTESTS OF OTHER THAN
SOLICITATION IMPROPRIETIES TO BE FILED WITHIN 10 WORKING DAYS AFTER THE
PROTESTER KNEW OR SHOULD HAVE KNOWN OF THE BASIS FOR THE PROTEST.
DURING THIS 10-DAY PERIOD, THE PROTESTER MUST OBTAIN WHATEVER WRITTEN OR
ORAL INFORMATION OR ADVICE IT NEEDS AND FILE ITS PROTEST IF IT SO
DESIRES. THIS 10-DAY PERIOD IS NOT TOLLED BY CONTINUING EFFORTS TO
CONVINCE THE AGENCY THAT ITS AWARD WAS IMPROPER. SEE CROWN LAUNDRY AND
DRY CLEANERS, INC., B-194505, JULY 18, 1979, 79-2 CPD 38. THUS,
HELICON'S PROTEST HERE, WHICH WAS FILED MONTHS AFTER IT KNEW THE FACTS
WHICH FORMED THE BASIS FOR ITS PROTEST, IS UNTIMELY.
MOREOVER, EVEN IF HELICON'S TELEPHONE CALL AND LETTERS COULD BE
TREATED AS A PROTEST TO THE AGENCY, THE PROTEST TO OUR OFFICE WOULD BE
UNTIMELY UNDER SECTION 21.2(A) OF OUR PROCEDURES BECAUSE IT WAS NOT
FILED WITHIN 10 WORKING DAYS OF HELICON'S KNOWLEDGE OF THE AGENCY'S
DENIAL OF ITS PROTEST. AT THE LATEST, THIS OCCURRED UPON HELICON'S
RECEIPT OF THE AGENCY'S REPLY OF SEPTEMBER 22 WHICH CLEARLY INDICATES
THE AGENCY INTENDED TO TAKE NO FURTHER ACTION ON THIS MATTER.
CONSEQUENTLY, HELICON'S PROTEST WILL NOT BE CONSIDERED ON ITS MERITS.
B-210335, MAY 23, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
ONCE A SERVICE HAS BEEN SUCCESSFULLY ACQUIRED BY A CONTRACTING OFFICE
ON THE BASIS OF A SMALL BUSINESS SET-ASIDE, THE DEFENSE ACQUISITION
REGULATION REQUIRES THAT FUTURE PROCUREMENTS OF THAT SERVICE BY THE SAME
OFFICE CONTINUE TO BE PROCURED ON A SET-ASIDE BASIS UNLESS THE
CONTRACTING OFFICER DETERMINES THAT THERE IS NO REASONABLE EXPECTATION
THAT COMPETITIVE BIDS AT REASONABLE PRICES WILL BE OBTAINED.
NORFOLK DREDGING COMPANY:
NORFOLK DREDGING COMPANY PROTESTS THE DECISION OF THE ARMY CORPS OF
ENGINEERS TO RESTRICT COMPETITION TO SMALL BUSINESS FIRMS UNDER
INVITATION FOR BIDS NO. DACW17-83-B-0010. NORFOLK, A LARGE BUSINESS,
CONTENDS THE DECISION WAS IMPROPER BECAUSE THE CONTRACTING OFFICER KNEW
OR SHOULD HAVE KNOWN THAT THERE WAS NO REASONABLE EXPECTATION THAT AN
AWARD AT REASONABLE PRICES COULD HAVE BEEN MADE UNDER SUCH A
RESTRICTION. NORFOLK'S PROTEST TO THE AGENCY TO HAVE THE RESTRICTION
REMOVED WAS DENIED BEFORE NORFOLK PROTESTED TO OUR OFFICE. THE BIDS
HAVE BEEN OPENED BUT NO AWARD HAS YET BEEN MADE.
THE PROTEST IS DENIED.
DEFENSE ACQUISITION REGULATION (DAR) SEC. 1-706.1(F) PROVIDES THAT
ONCE A SERVICE HAS BEEN SUCCESSFULLY ACQUIRED BY A CONTRACTING OFFICE ON
THE BASIS OF A SMALL BUSINESS SET-ASIDE, ALL FUTURE REQUIREMENTS OF THAT
OFFICE FOR THAT SERVICE ALSO BE ACQUIRED ON A SET-ASIDE BASIS UNLESS THE
CONTRACTING OFFICER DETERMINES THAT THERE IS NO REASONABLE EXPECTATION
THAT AT LEAST TWO BIDS AT REASONABLE PRICES CAN BE OBTAINED.
THE PROVISIONS OF DAR SEC. 1-706.1(F) APPLY HERE. THE AGENCY REPORTS
THAT SIMILAR SERVICES AT THE SAME LOCATION HAD BEEN SUCCESSFULLY
ACQUIRED FROM SMALL BUSINESSES BY THE SAME CONTRACTING OFFICE ON SIX
DIFFERENT OCCASIONS SINCE 1961. WE HAVE BEEN INFORMED BY THE ARMY THAT
THESE AWARDS TO SMALL BUSINESS FIRMS WERE MADE IN FY 78, FY 72, FY 68,
FY 66, FY 64 AND FY 61. THE 1978 CONTRACT WAS THE LAST CONTRACT
AWARDED. THUS, UNDER THE REGULATION THE CONTRACTING OFFICER WAS
REQUIRED TO SET THIS PROCUREMENT ASIDE UNLESS HE DETERMINED THAT THERE
WAS NOT A REASONABLE EXPECTATION OF RECEIVING AT LEAST TWO SMALL
BUSINESS BIDS AT REASONABLE PRICES. THE PROTESTER ARGUES THAT THE
CONTRACTING OFFICER DID NOT MAKE AN INDEPENDENT INVESTIGATION TO
DETERMINE IF BIDS AT REASONABLE PRICES COULD BE OBTAINED, BUT INSTEAD
MERELY "ACCEDED TO THE REQUEST OF THE SMALL BUSINESS ADMINISTRATION
REPRESENTATIVE ***." HOWEVER, THE REGULATION DOES NOT REQUIRE SUCH AN
INVESTIGATION, AND SINCE THE CONTRACTING OFFICER DID NOT, IN FACT,
DETERMINE THAT COMPETITION AND REASONABLE PRICES COULD NOT BE OBTAINED,
THE SET-ASIDE IS NOT LEGALLY OBJECTIONABLE.
WE NOTE THAT THE RESULTS OF THE RESTRICTED COMPETITION SUPPORT THE
INITIAL DECISION: 25 SMALL BUSINESS FIRMS REQUESTED THE PLANS AND
SPECIFICATIONS AND 9 OF THEM SUBMITTED BIDS. ALTHOUGH THE SIZE STATUS
OF THE LOW AND SECOND LOW BIDDERS WAS CHALLENGED AND SENT TO THE SMALL
BUSINESS ADMINISTRATION FOR RESOLUTION, SEVEN BIDS FROM SMALL FIRMS
WOULD REMAIN EVEN IF THE TWO LOW BIDDERS WERE DISQUALIFIED. THERE IS
ALSO NO INDICATION IN THE RECORD THAT THE PRICES BID WERE UNREASONABLE.
THE PROTEST IS DENIED.
B-210334, JUL 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
CIVILIAN PERSONNEL OFFICER AT THE U. S. ARMY RESERVE COMPONENT
PERSONNEL AND ADMINISTRATIVE CENTER RATHER THAN THE CONTRACTING OFFICER
PROCURED TRAINING BY A NON-GOVERNMENT FACILITY. WHERE THE CENTER
ACCEPTED THE TRAINING SERVICES AND RECEIVED A BENEFIT THEREFROM, PAYMENT
MAY BE MADE ON THE BASIS OF QUANTUM MERUIT PROVIDED THAT AN AUTHORIZED
CONTRACTING OFFICIAL RECOMMENDS PAYMENT.
CARROLL-DONAHUE ASSOCIATES:
THIS IS IN RESPONSE TO A REQUEST FOR AN ADVANCE DECISION BY MAJOR J.
M. VAUGHN, FINANCE AND ACCOUNTING OFFICER AT THE U. S. ARMY RESERVE
COMPONENT PERSONNEL AND ADMINISTRATIVE CENTER, ST. LOUIS, MISSOURI, AS
TO WHETHER PAYMENT IN THE AMOUNT OF $890 MAY BE MADE TO CARROLL-DONAHUE
ASSOCIATES (CARROLL-DONAHUE) FOR A TRAINING COURSE WHICH IT HAD
CONDUCTED AT THE CENTER. THE TRAINING COURSE, AT A COST OF $890, WAS
APPROVED BY THE CIVILIAN PERSONNEL OFFICER AT THE CENTER BY DD FORM
1556, REQUEST, AUTHORIZATION, AGREEMENT, CERTIFICATION OF TRAINING AND
REIMBURSEMENT, DATED JULY 20, 1982. THE COURSE ON LABOR RELATIONS FOR
FEDERAL SUPERVISORS AND MANAGERS WAS CONDUCTED AT THE CENTER ON JULY 19
AND 20, 1982.
THE FINANCE AND ACCOUNTING OFFICER HAS DENIED PAYMENT TO
CARROLL-DONAHUE SINCE HE BELIEVES THAT THE AGREEMENT BETWEEN THE AGENCY
AND CARROLL-DONAHUE FOR THE TRAINING IN QUESTION IS OF DOUBTFUL
VALIDITY. THE BASIS FOR THIS VIEW IS THAT THE TRAINING WAS AUTHORIZED
BY THE CIVILIAN PERSONNEL OFFICER AND NOT BY A CONTRACTING OFFICER IN
ACCORDANCE WITH REGULAR CONTRACT PROCEDURES.
ALTHOUGH THE REGULAR PROCUREMENT PROCEDURES SHOULD HAVE BEEN FOLLOWED
TO OBTAIN THE TRAINING COURSE, PAYMENT TO CARROLL-DONAHUE MAY BE MADE ON
THE BASIS OF QUANTUM MERUIT PROVIDED THAT AN AUTHORIZED CONTRACTING
OFFICIAL RECOMMENDS PAYMENT.
BY DD FORM 1556, REQUEST, AUTHORIZATION, AGREEMENT, CERTIFICATION OF
TRAINING AND REIMBURSEMENT, DATED JULY 20, 1982, THE CENTER'S CIVILIAN
PERSONNEL OFFICER APPROVED, AT A COST OF $890, A TRAINING COURSE IN
LABOR RELATIONS WHICH WAS CONDUCTED AT THE CENTER ON JULY 19 AND 20,
1982, BY CARROLL-DONAHUE. THE CIVILIAN PERSONNEL OFFICER APPROVED THE
TRAINING COURSE RATHER THAN SUBMITTING THE MATTER TO A CONTRACTING
OFFICER FOR CONSIDERATION UNDER THE REGULAR CONTRACT PROCEDURE SINCE HE
BELIEVED THAT THE APPROVAL OF SUCH TRAINING CONSTITUTED AN EXCEPTION TO
THE PROCUREMENT PROCESS. THE CIVILIAN PERSONNEL OFFICER'S UNDERSTANDING
OF HIS AUTHORITY TO APPROVE TRAINING BY A NON-GOVERNMENT FACILITY WAS
BASED ON THE INSTRUCTIONS CONTAINED IN THE APPENDIX TO CPR 400, CHAPTER
410, OF THE DEPARTMENT OF THE ARMY'S CIVILIAN PERSONNEL REGULATIONS
ENTITLED "INSTRUCTION FOR USING DD FORM 1556, REQUEST, AUTHORIZATION,
AGREEMENT, CERTIFICATION OF TRAINING AND REIMBURSEMENT," AS ADDED BY CPR
400, INTERIM CHANGE NO. 102, APRIL 3, 1980. INTERIM CHANGE 102 WAS
INCORPORATED WITH MINOR CHANGES, ON APRIL 1, 1982, AS SECTION 9-33 OF
ARMY REGULATION (AR) 37-107.
WITH REGARD TO THE AUTHORIZATION OF TRAINING IN OR BY NON-GOVERNMENT
FACILITIES PARAGRAPH B OF SECTION 9-33 PROVIDES:
"(1) SPECIAL TRAINING BY CONTRACT.
WHEN A TRAINING COURSE OR PROGRAM IS
DEVELOPED BY A NON-GOVERNMENT SOURCE TO MEET
A SPECIFIC REQUIREMENT, IT IS THE FUNCTION OF
AN AUTHORIZED CONTRACTING OFFICER TO CONTRACT
FOR THE TRAINING ON BEHALF OF AND AS REQUIRED
BY THE RESPONSIBLE EMPLOYEE DEVELOPMENT
SPECIALIST. IN SUCH CASES, THE COMMANDER
MUST FOLLOW PROCEDURES SET FORTH IN THE
DEFENSE ACQUISITION REGULATION (DAR),
INCLUDING THE USE OF APPROVED FORMS. THIS
PRECLUDES USING DD FORM 1556 AS A CONTRACTING
DOCUMENT FOR TRAINING UNDER THESE CONDITIONS;
HOWEVER, DD FORM 1556 MUST BE COMPLETED TO
REQUEST AND APPROVE TRAINING FOR EACH
INDIVIDUAL TO BE TRAINED (THE DD FORM 1556
SERVES AS A BACKUP DOCUMENT TO THE CONTRACTING DOCUMENTS).
"(2) NORMAL (NONCONTRACTUAL) TRAINING
AUTHORITY. TRAINING MAY BE AUTHORIZED AND
CERTIFICATION FOR REIMBURSEMENT ACCOMPLISHED
BY AN APPROPRIATE TRAINING OFFICIAL USING
DD FORM 1556 WHEN THE TRAINING IS REGULARLY
SCHEDULED, OPEN TO THE GENERAL PUBLIC (FOR
NON-GOVERNMENT TRAINING) AND THE PRICE OF
TUITION, BOOKS, AND FEES DOES NOT EXCEED THAT
CHARGED ALL ACCEPTED STUDENTS. EVEN THOUGH A
DOLLAR LIMITATION IS NOT ESTABLISHED UNDER
THESE REIMBURSEMENT CONDITIONS, THE
INDIVIDUAL RESPONSIBLE FOR THE TRAINING AND
DEVELOPMENT FUNCTION SHOULD CONSULT WITH THE
APPROPRIATE CONTRACTING OFFICER AND FOLLOW
REGULAR CONTRACT PROCEDURES WHEN THE PRICE
EXCEEDS $10,000. TRAINING WHICH COSTS LESS
THAN $10,000 DOES NOT HAVE TO BE SUBMITTED TO
A CONTRACTING OFFICER.
"(3) PAYMENT FOR TRAINING AT
NON-GOVERNMENT FACILITIES. WHEN TRAINING IS
PROPERLY AUTHORIZED BY AN APPROPRIATE TRAINING
OR OTHER MANAGEMENT OFFICIAL AND DOES NOT
INVOLVE A CONTRACTING FUNCTION OUTLINED IN
(1) ABOVE, DD FORM 1556 MAY BE USED FOR
CERTIFICATION FOR PAYMENT OF APPROVED COSTS
INCURRED IN TRAINING AT NON-GOVERNMENT
FACILITIES. SUCH CERTIFICATION DOES NOT
INVOLVE A CONTRACTING FUNCTION. STANDARD
FORM 1034 (PUBLIC VOUCHER FOR PURCHASES AND
SERVICES OTHER THAN PERSONAL) WILL BE USED AS
A PAYMENT VOUCHER."
SINCE THERE IS NO INDICATION IN THE RECORD TO THE CONTRARY WE WILL
PRESUME THAT THE CENTER'S CIVILIAN PERSONNEL OFFICER IS A MANAGEMENT
OFFICIAL AUTHORIZED TO APPROVE TRAINING UNDER PARAGRAPH B(2) OF SECTION
9-33 OF AR 37-107.
BY MEMORANDUM DATED AUGUST 10, 1982, TO THE ACTING COMPTROLLER, THE
FINANCE AND ACCOUNTING OFFICER ADVISED THAT IN HIS OPINION THE TRAINING
COURSE IN QUESTION DID NOT MEET THE CRITERIA FOR AN EXCEPTION TO THE
CONTRACTING PROCEDURES, FOR TRAINING WHICH IS "REGULARLY SCHEDULED" AND
"OPEN TO THE GENERAL PUBLIC." THE FINANCE AND ACCOUNTING OFFICER STATED
IN PERTINENT PART THAT HE VIEWED THE TERM "REGULARLY SCHEDULED" AS
MEANING THAT THE TRAINING IS OFFERED AT RECURRING, KNOWN, AND FIXED
INTERVALS, AND "OPEN TO THE GENERAL PUBLIC" AS MEANING THAT IT IS OPEN
TO ALL PERSONS WITHOUT RESTRICTION. HE FURTHER EXPRESSED THE VIEW THAT
THE EXCEPTION TO CONTRACTING FOR TRAINING WAS INTENDED TO FACILITATE THE
ATTENDANCE OF GOVERNMENT EMPLOYEES AT NON-GOVERNMENT EDUCATION OR
TRAINING OFFERED TO THE GENERAL PUBLIC AT AN ANNOUNCED DATE, TIME, AND
LOCATION BY PROFESSIONAL ASSOCIATIONS, GROUPS, COLLEGES, UNIVERSITIES,
OR CONSULTANTS.
IN RESPONSE TO THE VIEWS OF THE FINANCE AND ACCOUNTING OFFICER, THE
CIVILIAN PERSONNEL OFFICER BY MEMORANDUM DATED SEPTEMBER 30, 1982, TO
THE ACTING COMPTROLLER, STATED THAT HE HAD PROPERLY AUTHORIZED THE
TRAINING CONDUCTED BY CARROLL-DONAHUE. HE STATED THAT THE TRAINING
COURSE PRESENTED ENTITLED "LABOR RELATIONS FOR FEDERAL SUPERVISORS AND
MANAGERS" WAS A STANDARD "OFF-THE-SHELF" COURSE WHICH CARROLL-DONAHUE
PRESENTED ON A REGULAR BASIS UPON REQUEST AND IS LISTED IN THEIR
PUBLISHED CURRICULUM OF COURSE OFFERINGS. THUS, HE CONCLUDED THAT THE
PROVISIONS NOW SET FORTH AS PARAGRAPH B(1) OF SECTION 9-33, AR 37-107,
WHEREIN IT PROVIDES THAT A CONTRACTING OFFICER MUST CONTRACT FOR
TRAINING WHERE A TRAINING COURSE OR PROGRAM IS DEVELOPED TO MEET A
SPECIFIC REQUIREMENT WAS INAPPLICABLE TO THIS TRAINING. FURTHERMORE, HE
STATED THAT THE TRAINING COURSE MET THE CRITERIA NOW SET FORTH AT
PARAGRAPH B(2) OF SECTION 9-33, OF AR 37-107, SO AS TO PERMIT APPROVAL
AND REIMBURSEMENT FOR SUCH TRAINING OUTSIDE OF THE CONTRACT PROCESS. HE
NOTED THAT THE COST OF THE COURSE WAS UNDER $10,000 AND THAT THE $890
FEE WAS EQUAL TO OR LESS THAN THE PRICE ADVERTISED BY CARROLL-DONAHUE AS
THEIR NORMAL FEE. HE ADVISED THAT CARROLL-DONAHUE DOES NOT OPERATE A
CENTRALIZED TRAINING FACILITY BUT PROVIDES INSTRUCTIONAL SERVICES AND
COURSE MATERIALS ONLY, WITH THE REQUESTING ORGANIZATION PROVIDING THE
CLASSROOM FACILITIES. HE STATED THAT SINCE THE TRAINING COURSE IN
QUESTION WAS AN ESTABLISHED COURSE AND AVAILABLE TO THE GENERAL PUBLIC
UPON REQUEST, HE BELIEVED THAT IT MET THE CRITERIA OF TRAINING WHICH IS
"REGULARLY SCHEDULED" AND "OPEN TO THE GENERAL PUBLIC (FOR
NON-GOVERNMENT TRAINING)."
WE DO NOT BELIEVE THE TRAINING COURSE MADE AVAILABLE BY
CARROLL-DONAHUE SHOULD BE TREATED AS WITHIN THE PURVIEW OF SECTION
9-33B(2), ABOVE. AS WE INTERPRET THAT EXCEPTION IT APPLIES TO
SITUATIONS SUCH AS COURSES OFFERED AT A FIXED PRICE AT AN ANNOUNCED
DATE, TIME AND LOCATION BY COLLEGES, UNIVERSITIES, PROFESSIONAL
ASSOCIATIONS, OR GROUPS WHICH ARE OPEN TO THE GENERAL PUBLIC.
THEREFORE, REGULAR PROCUREMENT PROCEDURES SHOULD HAVE BEEN FOLLOWED TO
OBTAIN THE CARROLL-DONAHUE COURSE. TO HOLD OTHERWISE WOULD SUGGEST THAT
ALL OFF-THE-SHELF TRAINING OR EDUCATIONAL COURSES COULD BE OBTAINED BY
FEDERAL AGENCIES FROM PRIVATE FIRMS OUTSIDE THE FORMAL PROCUREMENT
PROCESS.
ALTHOUGH NO FORMALLY EXECUTED CONTRACT EXISTED BETWEEN THE ARMY AND
CARROLL-DONAHUE, IN APPROPRIATE CIRCUMSTANCES, WE HAVE RECOMMENDED THAT
PAYMENT MAY BE MADE FOR THE REASONABLE VALUE OF SERVICES FURNISHED TO
THE GOVERNMENT WITHOUT PROPER AUTHORIZATION ON A QUANTUM MERUIT BASIS.
40 COMP.GEN. 447, 451 (1961). RECOGNITION OF A RIGHT TO PAYMENT ON THIS
BASIS REQUIRES A SHOWING THAT THE GOVERNMENT RECEIVED A BENEFIT AND THAT
THE UNAUTHORIZED ACTION HAS BEEN EXPRESSLY OR IMPLIEDLY RATIFIED BY
AUTHORIZED CONTRACTING OFFICIALS OF THE GOVERNMENT. DEFENSE MAPPING
AGENCY, B-183915, JUNE 25, 1975, 75-2 CPD 15; THE SINGER COMPANY,
B-183878, JUNE 20, 1975, 75-1 CPD 406.
THE RECORD INDICATES THAT THE CENTER ACCEPTED THE TRAINING SERVICES
AND RECEIVED A BENEFIT THEREFROM AND THAT THE PURCHASE PRICE IS
CONSIDERED TO BE REASONABLE. IF PAYMENT IS RECOMMENDED BY AN AUTHORIZED
CONTRACTING OFFICIAL, AN IMPLIED RATIFICATION MAY BE INFERRED. ACTION,
B-202744, MAY 4, 1981, 81-1 CPD 339; PLANNING COMMUNICATION SERVICES,
INC., B-191476, MAY 31, 1978, 78-1 CPD 408.
THUS, IF PAYMENT FOR THE TRAINING COURSE BY CARROLL-DONAHUE IS
RECOMMENDED BY AN AUTHORIZED CONTRACTING OFFICIAL, PAYMENT ON A QUANTUM
MERUIT BASIS IN THE AMOUNT OF $890 MAY BE ALLOWED, IF OTHERWISE PROPER.
THE DEPARTMENT OF THE ARMY MAY WISH TO CONSIDER AMENDING SECTION 9-33
OF AR 37-107 SO THAT IT WILL MORE CLEARLY SET OUT THE INTENDED SCOPE OF
AUTHORITY FOR APPROVAL OF TRAINING BY USE OF DD FORM 1556.
B-210331, JUL 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
EMPLOYEE WAS AUTHORIZED PERMANENT CHANGE OF STATION (PCS) FROM
WASHINGTON, D. C., TO MEXICO. HE WAS NOT AUTHORIZED TO INCUR REAL
ESTATE EXPENSES AT GOVERNMENT EXPENSE. EMPLOYEE SOLD RESIDENCE AT OLD
DUTY STATION PRIOR TO REPORTING FOR DUTY AT NEW POST IN MEXICO ON JULY
29, 1978. AGENCY AUTHORIZED EMPLOYEE A TRANSFER IN NOVEMBER 1978 TO THE
CANAL ZONE BECAUSE GOVERNMENT OF MEXICO WOULD NOT GRANT ACCREDITATION
FOR CLAIMANT TO ESTABLISH RESIDENCY IN MEXICO. THE FACT THAT MEXICO
WOULD NOT GRANT ACCREDITATION DOES NOT CHANGE HIS STATUS TO TEMPORARY
DUTY. CLAIMANT IS NOT ENTITLED TO REIMBURSEMENT OF REAL ESTATE EXPENSES
INCURRED INCIDENT TO SALE OF MARYLAND RESIDENCE IN CONNECTION WITH PCS
TO MEXICO, SINCE BOTH THE OLD AND NEW DUTY STATIONS WERE NOT LOCATED
WITHIN THE UNITED STATES, ITS TERRITORIES AND POSSESSIONS, PUERTO RICO,
OR THE CANAL ZONE.
MARK Z. BRANDON, III - REAL ESTATE EXPENSES - TRANSFER TO FOREIGN
COUNTRY:
THIS DECISION IS IN RESPONSE TO A REQUEST BY MR. LESTER A. GESELL,
JR., COMPTROLLER, INTER AMERICAN GEODETIC SURVEY, DEFENSE MAPPING
AGENCY, AS TO WHETHER A TRAVEL VOUCHER IN THE AMOUNT OF $7,727.30,
SUBMITTED BY MR. MARK Z. BRANDON, III, AN EMPLOYEE OF THE AGENCY, MAY BE
CERTIFIED FOR PAYMENT. THE AMOUNT CLAIMED REPRESENTS REAL ESTATE
EXPENSES INCURRED BY MR. BRANDON INCIDENT TO A PERMANENT CHANGE OF
STATION (PCS) TO MEXICO CITY, MEXICO. FOR THE REASONS HEREAFTER STATED,
THE VOUCHER MAY NOT BE CERTIFIED FOR PAYMENT.
THE CERTIFYING OFFICER HAS ASKED SEVERAL QUESTIONS CONCERNING MR.
BRANDON'S TRANSFER AND HIS ENTITLEMENT TO REIMBURSEMENT OF REAL ESTATE
EXPENSES. THE PRIMARY ISSUES PRESENTED BY THE QUESTIONS ARE, FIRST, WAS
THE TRANSFER TO MEXICO CITY, MEXICO, A PCS OR MERELY A TEMPORARY DUTY
ASSIGNMENT OF APPROXIMATELY 4 MONTHS; AND, SECOND, IF THE TRANSFER WAS
A PCS, IS MR. BRANDON ENTITLED TO REIMBURSEMENT OF $7,727.30 IN REAL
ESTATE EXPENSES INCURRED IN SELLING HIS MARYLAND RESIDENCE ON JUNE 26,
1978.
ON MAY 17, 1978, MR. BRANDON WAS AUTHORIZED A PCS FROM WASHINGTON, D.
C., TO MEXICO CITY, MEXICO. MR. BRANDON AND HIS FAMILY ARRIVED IN
MEXICO CITY ON JULY 29, 1978, UNDER THE AUTHORITY OF A COUNTRY CLEARANCE
ISSUED BY THE UNITED STATES EMBASSY IN MEXICO. THE UNITED STATES
EMBASSY COMMENCED THE ACCREDITATION PROCESS FOR MR. BRANDON UPON HIS
ARRIVAL IN MEXICO. THE ACCREDITATION IS NECESSARY FOR FOREIGN OFFICIALS
OR EMPLOYEES TO ENABLE THEM TO ESTABLISH RESIDENCY IN MEXICO AND PERMIT
THE ENTRANCE OF HOUSEHOLD GOODS DUTY FREE. DUE TO MR. BRANDON'S DUTIES
WITH THE PAN AMERICAN INSTITUTE OF GEOGRAPHY AND HISTORY, THE GOVERNMENT
OF MEXICO REFUSED TO GRANT ACCREDITATION. DURING AUGUST, SEPTEMBER, AND
OCTOBER, THE EMBASSY ATTEMPTED TO ESTABLISH ACCREDITATION FOR MR.
BRANDON. IN LATE OCTOBER, IT BECAME APPARENT THAT THE GOVERNMENT OF
MEXICO WOULD NOT GRANT ACCREDITATION TO MR. BRANDON. THE EMPLOYEE WAS
THEREFORE UNABLE TO ESTABLISH RESIDENCY OR BE STATIONED IN MEXICO
THROUGH NO FAULT OR NEGLIGENCE ON HIS PART. THE DECISION WAS THEN MADE
TO TRANSFER MR. BRANDON TO THE CANAL ZONE IN THE SAME POSITION AND GRADE
RATHER THAN RETURN HIM TO WASHINGTON. BY TRAVEL AUTHORIZATION DATED
NOVEMBER 2, 1978, MR. BRANDON WAS TRANSFERRED TO THE CANAL ZONE. HE
REPORTED FOR DUTY ON NOVEMBER 6, 1978.
THIS OFFICE HAS LONG HELD THAT THE ISSUE OF WHETHER A PARTICULAR DUTY
STATION IS, IN FACT, PERMANENT OR TEMPORARY IS A QUESTION OF FACT TO BE
DETERMINED FROM THE TRAVEL ORDERS UNDER WHICH THE ASSIGNMENT IS MADE
AND, WHERE NECESSARY, FROM THE CHARACTER OF THE ASSIGNMENT, PARTICULARLY
THE DURATION OF THE ASSIGNMENT AND THE NATURE OF THE DUTY PERFORMED.
FREDERICK C. WELCH, B-206105, DECEMBER 8, 1982, 62 COMP.GEN.
; 33 COMP.GEN. 98 (1953); B-172207, JULY 21, 1971.
ANOTHER WELL-ESTABLISHED RULE IS THAT THE EFFECTIVE DATE OF A CHANGE
OF OFFICIAL STATION IS THE DATE THE EMPLOYEE REPORTS FOR DUTY AT HIS NEW
OFFICIAL STATION. ROBERT A. MOTES, B-210953, APRIL 22, 1983; ELIZABETH
B. MULLIS, B-194650, FEBRUARY 13, 1980; PARAGRAPH 2-1.4J, FEDERAL
TRAVEL REGULATIONS, FPMR 101-7 (MAY 1973) (FTR).
HERE, THE TRAVEL ORDERS DATED MAY 17, 1978, ISSUED TO MR. BRANDON,
AUTHORIZED A PERMANENT CHANGE OF OFFICIAL STATION FROM WASHINGTON, D.
C., TO MEXICO CITY, MEXICO. THERE WAS NO TIME LIMITATION STATED AS TO
THE DURATION OF THE TRANSFER, AND IT APPEARS THAT THE EMPLOYEE PERFORMED
THE FULL RANGE OF HIS DUTIES DURING THE APPROXIMATELY 4-MONTH PERIOD HE
WORKED IN MEXICO. THE FAILURE OF THE GOVERNMENT OF MEXICO TO GRANT
ACCREDITATION TO MR. BRANDON WOULD NOT CHANGE HIS STATUS TO TEMPORARY
DUTY WHERE IT IS CLEAR THAT THE DEFENSE MAPPING AGENCY INTENDED, AND THE
EMPLOYEE CONTEMPLATED THAT MEXICO CITY WOULD IN FACT BE HIS PERMANENT
DUTY STATION. THE EFFECTIVE DATE OF THE TRANSFER WAS JULY 29, 1978, THE
DATE MR. BRANDON REPORTED FOR DUTY AT HIS NEW POST OF DUTY IN MEXICO
CITY. THUS, MR. BRANDON'S SUBSEQUENT TRANSFER TO THE CANAL ZONE WAS A
SECOND PERMANENT CHANGE OF STATION.
FURTHER, MR. BRANDON SOLD HIS FORMER RESIDENCE IN POTOMAC, MARYLAND,
ON JUNE 26, 1978, PRIOR TO THE DATE HE REPORTED FOR DUTY IN MEXICO CITY.
THUS, THE SALE OF THE RESIDENCE AT HIS OLD DUTY STATION WAS MADE
INCIDENT TO HIS PERMANENT CHANGE OF OFFICIAL STATION TO MEXICO CITY,
MEXICO, NOT IN CONNECTION WITH HIS SUBSEQUENT TRANSFER TO THE CANAL
ZONE.
THE QUESTION THEN ARISES AS TO WHETHER MR. BRANDON MAY BE REIMBURSED
FOR THE REAL ESTATE EXPENSES HE INCURRED IN SELLING HIS MARYLAND
RESIDENCE, INCIDENT TO HIS CHANGE OF OFFICIAL STATION TO MEXICO CITY,
MEXICO.
SECTION 5724A(A)(4) OF TITLE 5, UNITED STATES CODE (1976), PROVIDES
THAT AN EMPLOYEE TRANSFERRED IN THE INTEREST OF THE GOVERNMENT FROM ONE
OFFICIAL STATION TO ANOTHER FOR PERMANENT DUTY MAY BE REIMBURSED THE
EXPENSES OF THE SALE OF HIS RESIDENCE AT THE OLD STATION AND THE
PURCHASE OF A RESIDENCE AT THE NEW OFFICIAL STATION WHEN THE OLD AND NEW
OFFICIAL STATIONS ARE LOCATED WITHIN THE UNITED STATES, ITS TERRITORIES
OR POSSESSIONS, THE COMMONWEALTH OF PUERTO RICO, OR THE CANAL ZONE. SEE
ALSO FTR PARAGRAPH 2-6.1A.
THIS OFFICE HAS CONSISTENTLY HELD THAT 5 U.S.C. SEC. 5724A REQUIRES
THAT BOTH THE OLD AND NEW DUTY STATIONS BE LOCATED WITHIN THE AREAS
LISTED. THUS, REIMBURSEMENT OF REAL ESTATE EXPENSES MAY NOT BE MADE TO
AN EMPLOYEE FOR THE COSTS INCURRED IN SELLING A RESIDENCE IN THE UNITED
STATES INCIDENT TO A CHANGE OF OFFICIAL STATION TO A FOREIGN POST OF
DUTY. 47 COMP.GEN. 93 (1967); JAN UNTERZUBER, B-193728, AUGUST 10,
1979. INASMUCH AS MR. BRANDON'S NEW DUTY STATION WAS MEXICO CITY,
MEXICO, THERE IS NO AUTHORITY FOR REIMBURSEMENT OF THE CLAIMED REAL
ESTATE EXPENSES.
ACCORDINGLY, THE TRAVEL VOUCHER IN THE AMOUNT OF $7,727.30, SUBMITTED
BY MR. MARK Z. BRANDON, III, MAY NOT BE CERTIFIED FOR PAYMENT.
B-210322, JAN 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST AGAINST SMALL BUSINESS ADMINISTRATION (SBA) SIZE APPEALS
BOARD DETERMINATION THAT AWARDEE QUALIFIED AS A SMALL BUSINESS IS
DISMISSED, SINCE SBA HAS CONCLUSIVE AUTHORITY TO DETERMINE BUSINESS SIZE
STATUS.
TACONIC PLASTICS LTD.:
TACONIC PLASTICS LTD. (TACONIC) PROTESTS THE DECISION OF THE SIZE
APPEALS BOARD OF THE SMALL BUSINESS ADMINISTRATION (SBA) THAT SOUTHEAST
INDUSTRIAL TAPE (SIT), THE AWARDEE UNDER SOLICITATION NO.
DLA400-82-B-5826, A SMALL BUSINESS SET-ASIDE ISSUED BY THE DEFENSE
LOGISTICS AGENCY, IS A SMALL BUSINESS MANUFACTURER OF THE END ITEM
SOLICITED AND IS THEREFORE ELIGIBLE FOR AWARD AS A SMALL BUSINESS.
TACONIC ARGUES THAT SIT IS NOT A SMALL BUSINESS AND PROTESTS THAT THE
SBA DECISION IS INCORRECT.
UNDER 15 U.S.C. SEC. 637(B)(6) (1976), THE SBA IS EMPOWERED TO
CONCLUSIVELY DETERMINE SMALL BUSINESS SIZE STATUS FOR FEDERAL
PROCUREMENTS AND SALES. THEREFORE, WE DO NOT CONSIDER SIZE STATUS
PROTESTS, AND SBA'S DETERMINATION IS NOT SUBJECT TO OUR REVIEW.
WATERBURY LOCK & SPECIALTY COMPANY, B-208532, SEPTEMBER 8, 1982, 82-2
CPD 210; THE WENNINGER COMPANY, INC., B-205093.2, MAY 5, 1982, 82-1 CPD
424.
WE DISMISS THE PROTEST.
B-210321, JUN 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. QUESTION OF WHETHER CONTRACT SHOULD BE TERMINATED FOR DEFAULT AND
WHETHER DEFAULTED CONTRACTOR SHOULD BE HELD LIABLE FOR EXCESS
REPROCUREMENT COST IS A MATTER WITHIN THE JURISDICTION OF THE ARMED
SERVICES BOARD OF CONTRACT APPEALS UNDER THE DISPUTES CLAUSE OF THE
CONTRACT AND IS NOT FOR CONSIDERATION BY GAO.
2. CONTRACTING OFFICER ACTED REASONABLY IN NEGOTIATING A
REPROCUREMENT CONTRACT ON A SOLE-SOURCE BASIS WITH ONLY OTHER BIDDER ON
THE ORIGINAL PROCUREMENT AT MINIMAL PRICE INCREASE OVER ORIGINAL BID
WHERE THE DEFAULTING CONTRACTOR DELIVERED NONCONFORMING PRODUCTS, FAILED
TO MEET ORIGINAL AND EXTENDED DELIVERY DATES, AND WAS UNCERTAIN AS TO
TIMETABLE FOR PROPOSED CORRECTIVE ACTION PRIOR TO DEFAULT.
INTROL CORPORATION:
INTROL CORPORATION (INTROL) PROTESTS THE SOLE-SOURCE REPROCUREMENT
AND AWARD OF CONTRACT NO. N60530-83-C-0014, BY THE NAVAL WEAPONS CENTER
(NWC), DEPARTMENT OF THE NAVY (NAVY), TO TELEDYNE INET FOR TWO
MOTOR-DRIVEN CONVERTERS, AFTER THE NAVY TERMINATED INTROL'S CONTRACT FOR
DEFAULT. INTROL CONTENDS THAT ITS PRIOR CONTRACT WITH THE NAVY SHOULD
NOT HAVE BEEN TERMINATED FOR DEFAULT, THAT IT SHOULD NOT BE HELD LIABLE
FOR THE EXCESS COST OF REPROCUREMENT, AND THAT THE REPROCUREMENT WAS
IMPROPERLY NEGOTIATED ON A SOLE-SOURCE BASIS.
FOR THE REASONS STATED BELOW, THE PROTEST IS DISMISSED IN PART AND
DENIED IN PART.
THE NAVY ORIGINALLY AWARDED INTROL A $77,118 CONTRACT FOR THE
CONVERTERS PURSUANT TO AN INVITATION FOR BIDS UNDER WHICH TELEDYNE INET
SUBMITTED THE ONLY OTHER BID AT $77,526. AFTER INTROL FAILED TO MEET
THE REQUIRED 180-DAY DELIVERY DATE, MAY 3, 1982, THE NAVY AND INTROL
AGREED TO AN EXTENDED DELIVERY DATE OF JUNE 24, 1982.
INTROL DID NOT DELIVER THE CONVERTERS UNTIL JUNE 28, 1982, AND THE
CONVERTERS WERE 94 INCHES HIGH, 22 INCHES HIGHER THAN CALLED FOR IN THE
SPECIFICATIONS. FOLLOWING A SHOW CAUSE LETTER AND A MEETING WITH NAVY
PERSONNEL, ON AUGUST 2, 1982, INTROL PROPOSED TWO OPTIONS TO COMPLETE
PERFORMANCE. ON AUGUST 30, 1982, THE NAVY REJECTED INTROL'S OPTIONS AND
TERMINATED THE CONTRACT WITH INTROL FOR DEFAULT DUE TO THE FAILURE OF
INTROL TO DELIVER CONFORMING CONVERTERS.
SINCE ONLY TWO BIDS WERE INITIALLY RECEIVED, THE NAVY DECIDED TO
NEGOTIATE WITH THE ONLY OTHER BIDDER, TELEDYNE INET, PURSUANT TO DEFENSE
ACQUISITION REGULATION (DAR) SEC. 8-602.6(B) (1976 ED.), WHICH PROVIDES
THAT REPURCHASES AGAINST A DEFAULTING CONTRACTOR'S ACCOUNT FOR THE SAME
SUPPLIES DO NOT HAVE TO BE FORMALLY ADVERTISED. THE NAVY AND TELEDYNE
INET NEGOTIATED A CONTRACT FOR $81,898, AN INCREASE OF $4,372 OVER
TELEDYNE INET'S ORIGINAL BID, WITH A DELIVERY DATE OF APRIL 4, 1983.
INTROL APPEALED THE TERMINATION FOR DEFAULT TO THE ARMED SERVICES
BOARD OF CONTRACT APPEALS (ASBCA) BEFORE PROTESTING THE REPROCUREMENT
CONTRACT TO THIS OFFICE.
WE WILL NOT CONSIDER INTROL'S ARGUMENTS CONCERNING THE PROPRIETY OF
THE DEFAULT TERMINATION AND ITS LIABILITY FOR THE EXCESS COST OF
REPROCUREMENT. THE QUESTION OF WHETHER A CONTRACT SHOULD BE TERMINATED
FOR DEFAULT AND WHETHER THE DEFAULTED CONTRACTOR SHOULD BE HELD LIABLE
FOR THE EXCESS COST OF REPROCUREMENT IS A MATTER WITHIN THE JURISDICTION
OF THE ASBCA UNDER THE DISPUTES CLAUSE OF INTROL'S CONTRACT AND IS NOT
FOR CONSIDERATION BY OUR OFFICE. MCQUISTON ASSOCIATES - RECONSIDERATION,
B-199013.2, OCTOBER 29, 1981, 81-2 CPD 365; ROGOW & BERNSTEIN,
B-197269, JUNE 11, 1980, 80-1 CPD 406.
INTROL OBJECTS TO THE SOLE-SOURCE REPROCUREMENT BECAUSE IT AND OTHER
COMPANIES ALLEGEDLY PRODUCE THE REQUIRED CONVERTERS. INTROL POINTS OUT
THAT ITS AUGUST 2, 1982, LETTER HAD ASSURED THE NAVY OF CORRECTIVE
ACTION BEFORE THE APRIL 4, 1983, DELIVERY DATE OF THE REPROCUREMENT
CONTRACT. INTROL ALSO ARGUES THAT IT HAS SHOWN ITS CAPABILITY OF
PRODUCING THE REQUIRED EQUIPMENT IN SPITE OF THE ERROR OF PHYSICAL
DIMENSION, HAS PROVEN ITS WILLINGNESS TO WORK WITH THE CONTRACTING
OFFICER AND USING ACTIVITY TO CORRECT THE ERROR, HAS PRODUCED SIMILAR
EQUIPMENT FOR GOVERNMENT AGENCIES INCLUDING NWC, AND HAS ESTABLISHED AN
EXCELLENT REPUTATION OF MEETING ITS COMMITMENTS TO GOVERNMENT AND
PRIVATE CONCERNS. INTROL FURTHER CONTENDS THAT TELEDYNE INET HAS A POOR
RECORD OF DELIVERY OF CONTRACT REQUIREMENTS AND HAS HAD NUMEROUS
CONTRACTS CANCELED DUE TO POOR PERFORMANCE.
INITIALLY, WE NOTE THAT WE ASSUME THE AWARD TO TELEDYNE INET WAS
PRECEDED BY AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY, A MATTER
WHICH WE DO NOT REVIEW WHEN CONTENTIONS SUCH AS INTROL'S ARE MADE. SEE
DOMAR INDUSTRIES, B-209861, DECEMBER 30, 1982, 82-2 CPD 589.
THE NAVY ASSERTS THAT IT COULD NOT REASONABLY EXPECT INTROL TO
PERFORM TIMELY AND INCLUDE INTROL IN THE REPROCUREMENT. INTROL HAD
FAILED TO MEET EITHER THE ORIGINAL OR THE MUTUALLY AGREED-UPON EXTENDED
DELIVERY DATE. FURTHER, INTROL'S DELIVERED PRODUCT DEVIATED MATERIALLY
FROM THE SPECIFICATIONS. ALSO, INTROL HAD ORALLY PROPOSED DELIVERY OF
CORRECTED CONVERTERS AT THE PREDEFAULT MEETING IN 14 TO 16 WEEKS AND
THEN EXTENDED THAT CORRECTIVE PERIOD IN THE AUGUST 2, 1982, LETTER TO AN
18- TO 20-WEEK DELIVERY PERIOD. AS FOR OTHER SOURCES, THE NAVY CONTENDS
THAT IT REASONABLY KNEW OF AND TURNED TO TELEDYNE INET ALONE, THE ONLY
OTHER SOURCE IN THE ORIGINAL COMPETITION. THE NAVY FURTHER CONTENDS
THAT THE PRICE INCREASE OF THE REPROCUREMENT CONTRACT ($4,372) OVER
TELEDYNE INET'S ORIGINAL BID WAS FAIR AND REASONABLE IN VIEW OF THE
RISING COSTS OF MATERIALS, LABOR, UTILITIES, ETC., OVER THE APPROXIMATE
11-MONTH PERIOD SINCE TELEDYNE INET ORIGINALLY BID.
WE ARE PERSUADED THAT THE NAVY'S BASIS FOR THE SOLE-SOURCE AWARD WAS
REASONABLY FOUNDED. THE AGENCY'S LACK OF CONFIDENCE IN INTROL'S
ASSURANCES OF ANY TIMELY PERFORMANCE WAS JUSTIFIED BY INTROL'S FAILURE
TO MEET TWO DELIVERY DATES AND THE UNCERTAINTY OF ASSURANCES CONCERNING
CORRECTIVE ACTION PRIOR TO THE DEFAULT. FURTHER, WE HAVE HELD THAT AN
AWARD OF A REPROCUREMENT CONTRACT TO THE NEXT QUALIFIED OFFEROR ON THE
ORIGINAL SOLICITATION OR TO ONLY OTHER ACCEPTABLE OFFEROR ON THE
ORIGINAL SOLICITATION IS A RECOGNIZED METHOD OF REPROCUREMENT, EVEN
WHERE, UNLIKE HERE, OTHER FIRMS PARTICIPATED THEREUNDER. ROGOW &
BERNSTEIN, SUPRA; HEMET VALLEY FLYING SERVICE, INC., 57 COMP.GEN. 703
(1978), 78-2 CPD 117; DIVERSIFIED COMPUTER CONSULTANTS, B-205820, JULY
13, 1982, 82-2 CPD 47. FINALLY, WE SEE NO LEGAL IMPEDIMENT TO THE
RELATIVELY MINIMAL INCREASE OF PRICE IN THE TELEDYNE INET REPROCUREMENT
CONTRACT OVER ITS ORIGINAL BID. CF. FITZGERALD LABORATORIES, INC.,
ASBCA, 15205, 15594, 71-2 BCA 9029.
ACCORDINGLY, THE PROTEST IS DISMISSED IN PART AND DENIED IN PART.
B-210317.2, AUG 15, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PRIOR DECISION HOLDING THAT CANCELLATION OF IFB
AFTER BID OPENING WAS PROPER IS AFFIRMED SINCE
IT HAS NOT BEEN ESTABLISHED THAT THE DECISION
WAS BASED ON ERRORS OF FACT OR LAW.
CHEMICAL COMPOUNDING CORPORATION - RECONSIDERATION:
CHEMICAL COMPOUNDING CORPORATION (CHEMICAL) REQUESTS RECONSIDERATION
OF OUR DECISION IN CHEMICAL COMPOUNDING CORPORATION, B-210317, MAY 10,
1983, 83-1 CPD 499, IN WHICH WE DENIED CHEMICAL'S PROTEST CONCERNING THE
DEFENSE LOGISTICS AGENCY'S CANCELLATION OF INVITATION FOR BIDS (IFB) NO.
DLA400-82-B-6758 FOR CHLORINATION KITS.
IN DENYING CHEMICAL'S PROTEST, WE HELD THAT THE CONTRACTING OFFICER
ACTED REASONABLY AT THE TIME OF HER DECISION TO CANCEL THE IFB IN VIEW
OF THE PREMATURE OPENING OF THREE BIDS (INCLUDING CHEMICAL'S LOW
RESPONSIVE BID), THE PROTEST OF THAT PREMATURE OPENING BY THE AWARDEE ON
THE PRIOR IFB FOR THESE KITS, WHICH HAD NOT BID RELYING ON AN INDEFINITE
BID OPENING EXTENSION, AND THE NUMBER OF POTENTIAL BIDDERS.
CHEMICAL ARGUES THAT OUR OFFICE FAILED TO PROVIDE A DEFINITION OR
STANDARD TO DETERMINE WHETHER AN ACTION IS REASONABLE. FURTHER,
CHEMICAL CONTENDS THAT THE EQUITIES DUE THE FIRMS WHICH HAD BIDS
PREMATURELY EXPOSED OUTWEIGHED THE RIGHTS OF POTENTIAL BIDDERS SINCE
ADEQUATE COMPETITION WAS OBTAINED AND THE PRICES WERE REASONABLE.
CHEMICAL ALSO ARGUES THAT SCOTT GRAPHICS INCORPORATED, ET AL., 54 COMP.
GEN. 973 (1975), 75-1 CPD 302, RELIED UPON BY OUR OFFICE, SUPPORTS ITS
POSITION THAT THERE WERE NO COGENT OR COMPELLING REASONS TO CANCEL THE
IFB. FOR THE FOLLOWING REASONS, WE AFFIRM OUR DECISION.
WE AGREE WITH CHEMICAL THAT CANCELLATION IS IMPROPER ABSENT A COGENT
AND COMPELLING REASON. HOWEVER, A CONTRACTING OFFICER'S AUTHORITY TO
CANCEL A SOLICITATION IS BROAD AND, IN THE ABSENCE OF A CLEAR LACK OF
REASON, A DECISION TO CANCEL A SOLICITATION WILL BE UPHELD. THE
PROPRIETY OF A PARTICULAR CANCELLATION "MUST STAND UPON ITS OWN FACTS."
EDWARD B. FRIEL, INC., 55 COMP.GEN. 231, 240 (1975), 75-2 CPD 164.
WHILE WE AGREE THAT THE EXPOSURE OF THE PREMATURELY OPENED BIDS WAS A
FACTOR TO BE CONSIDERED BY THE CONTRACTING OFFICER, WE CANNOT CONCLUDE
THAT THE CONTRACTING OFFICER'S DECISION TO CANCEL BASED ON A BALANCING
OF THE ABOVE CIRCUMSTANCES WAS WITHOUT REASON.
IN SCOTT, WE HELD THAT CANCELLATION WAS SUPPORTABLE WHERE THE
CONTRACTING AGENCY FAILED TO SOLICIT THE INCUMBENT CONTRACTOR WHICH WAS
ONE OF A LIMITED NUMBER OF MANUFACTURERS OF THE ITEMS BEING PROCURED.
CHEMICAL ARGUES THAT OUR RELIANCE ON SCOTT WAS MISPLACED BECAUSE, THERE,
THE INCUMBENT WAS UNAWARE OF THE SOLICITATION; HERE, THE PRIOR AWARDEE
WAS AWARE OF THE SOLICITATION AND ALLEGEDLY WAS NEGLIGENT. FIRST, WE
SEE NO MERIT IN CHEMICAL'S ARGUMENT THAT THE PRIOR AWARDEE'S FAILURE TO
BID PRIOR TO OR SHORTLY AFTER THE ORIGINAL BID OPENING DATE WAS
NEGLIGENT AND IMPROPERLY CONTRIBUTED TO ITS INABILITY TO COMPETE.
SECOND, IN POWER ENERGY INDUSTRIES, B-209705, JULY 5, 1983, 83-2 CPD
, WE HELD THAT THE ELIMINATION OF ONE OF A LIMITED NUMBER OF SOURCES
WHICH HAD FAILED TO BID DUE TO MISLEADING AGENCY ADVICE AS TO AN
EXTENDED BID OPENING DATE MIGHT VERY WELL HAVE INDEPENDENTLY SUPPORTED
AN AGENCY CANCELLATION DECISION.
WE CONCLUDE THAT CHEMICAL HAS NOT ESTABLISHED THAT OUR PRIOR DECISION
WAS BASED ON AN ERRONEOUS INTERPRETATION OF EITHER FACT OR LAW.
THEREFORE, WE AFFIRM OUR DECISION.
B-210317, MAY 10, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
CANCELLATION OF SOLICITATION AFTER BID OPENING AND RESOLICITATION WAS
PROPER WHERE AGENCY REASONABLY DETERMINED THAT, SINCE BIDS HAD BEEN
OPENED PREMATURELY, THERE WAS APPARENT PREJUDICE TO AWARDEE UNDER PRIOR
PROCUREMENT, WHICH HAD PROTESTED PREMATURE OPENING, AND TO OTHER
POTENTIAL BIDDERS. EVEN IF PROTESTER HAS SHOWN THAT INCREASED
COMPETITION WAS UNLIKELY BASED ON LIMITED COMPETITION IN PAST AND ON THE
RESOLICITATION (PRIOR AWARDEE DID NOT BID), AGENCY'S EXCLUSION OF
INCUMBENT ALONE SUPPORTS CANCELLATION.
CHEMICAL COMPOUNDING CORPORATION:
CHEMICAL COMPOUNDING CORPORATION (CHEMICAL) PROTESTS THE DEFENSE
LOGISTICS AGENCY (DLA) CANCELLATION OF INVITATION FOR BIDS (IFB) NO.
DLA400-82-B-6758 FOR CHLORINATION KITS.
WE DENY THE PROTEST.
PRIOR TO THE SCHEDULED OCTOBER 19, 1982, BID OPENING, THE PROCURING
ACTIVITY DETERMINED THAT THE PURCHASE ITEM DESCRIPTION CONTAINED IN THE
IFB SHOULD BE REWRITTEN TO DELINEATE MORE CLEARLY THE COMPONENTS OF THE
ITEM. THEREFORE, ON OCTOBER 15, 1982, THE PROCURING ACTIVITY ISSUED A
TWX TO 23 POTENTIAL BIDDERS EXTENDING THE BID OPENING DATE INDEFINITELY
AND INDICATING THE ITEM DESCRIPTION MIGHT BE REVISED. NEVERTHELESS, ON
OCTOBER 19, 1982, THREE BIDS THAT HAD ALREADY BEEN RECEIVED WERE OPENED
IN ERROR. THE LOW BID WAS DETERMINED NONRESPONSIVE. THE NEXT LOW BID
WAS SUBMITTED BY CHEMICAL, AND THE OTHER BID WAS SUBMITTED BY ANACHEMIA
CHEMICAL (ANACHEMIA). ON OCTOBER 23, 1982, ECOLOGIC INSTRUMENT,
DIVISION OF INDUSTRIAL MUNICIPAL EQUIPMENT, INC. (ECOLOGIC), THE AWARDEE
ON THE LAST IFB FOR THESE KITS (IFB NO. DLA400-82-B-2632), PROTESTED TO
THE CONTRACTING OFFICER AGAINST THE PREMATURE OPENING BECAUSE IT HAD NOT
SUBMITTED A BID IN RELIANCE ON THE INDEFINITE EXTENSION.
ON NOVEMBER 2, 1982, THE CONTRACTING OFFICER CANCELED THE IFB BECAUSE
OF THE PREMATURE BID OPENING AND INADEQUATE/AMBIGUOUS SPECIFICATIONS.
AFTER BID OPENING, DLA HAD RECEIVED A REQUIREMENT FOR AN ADDITIONAL
QUANTITY OF KITS. THE QUANTITIES ORIGINALLY SOLICITED UNDER THE IFB
WERE ADDED TO A NEW IFB (NO. DLA400-83-B-1338) ISSUED WITH A REVISED
PURCHASE ITEM DESCRIPTION FOR AN INDEFINITE DELIVERY-TYPE CONTRACT. THE
MINIMUM AMOUNT THE AGENCY IS REQUIRED TO PURCHASE UNDER THE INDEFINITE
DELIVERY-TYPE CONTRACT EXCEEDS THE QUANTITITES SOLICITED ON THE CANCELED
IFB, AND THE ESTIMATED QUANTITIES ARE CONSIDERABLY LARGER. ANACHEMIA
SUBMITTED THE LOW BID UNDER THIS IFB.
DLA CONTENDS THAT, DUE TO THE PREMATURE BID OPENING, POTENTIAL
BIDDERS, INCLUDING THE LAST SUCCESSFUL BIDDER WHICH PROTESTED, HAD BEEN
PREJUDICED AND, THEREFORE, FULL AND FREE COMPETITION HAD NOT BEEN
OBTAINED. THE AGENCY CITES QUAKER BUSINESS ASSOCIATES, INC., B-187207,
NOVEMBER 17, 1976, 76-2 CPD 430, WHERE OUR OFFICE HELD THAT WHEN BIDS
HAD BEEN OPENED PREMATURELY, CANCELLATION OF AN IFB AFTER OPENING WAS
PROPER. THE CONTRACTING OFFICER STATES THAT ONCE THE PREMATURE BID
OPENING OCCURRED, SHE DECIDED THAT GREATER HARM WOULD BE DONE TO THE
COMPETITIVE BIDDING PROCEDURES BY AWARDING THE CONTRACT, THEREBY
EXCLUDING FIRMS FROM COMPETING, THAN BY CANCELING THE IFB DESPITE THE
FACT THAT THE LOW RESPONSIVE BID OF CHEMICAL HAD BEEN EXPOSED.
CHEMICAL CONTENDS QUAKER IS NOT APPLICABLE BECAUSE, THERE, SINCE ONLY
TWO BIDS WERE RECEIVED AND SEVERAL FIRMS REQUESTED THAT THE BID OPENING
DATE BE EXTENDED, THE AGENCY JUSTIFIABLY DETERMINED THAT FULL AND FREE
COMPETITION HAD NOT BEEN OBTAINED. HERE, CHEMICAL ARGUES THAT THERE WAS
ADEQUATE COMPETITION AND THAT IT WAS UNLIKELY THAT INCREASED COMPETITION
WOULD RESULT. TO SUPPORT THIS, CHEMICAL POINTS OUT THAT UNDER IFB -2632
ONLY CHEMICAL, ANACHEMIA, AND ECOLOGIC BID; UNDER THE CANCELED IFB,
ONLY CHEMICAL AND ANACHEMIA SUBMITTED RESPONSIVE BIDS; AND UNDER THE
RESOLICITATION, ONLY ONE NEW BIDDER (NOT LOW) SURFACED OTHER THAN
CHEMICAL AND ANACHEMIA. CHEMICAL FINALLY STATES THAT IT IS SPECULATIVE
WHETHER ECOLOGIC WOULD HAVE SUBMITTED A BID AND THAT THE FIRM ACTUALLY
FAILED TO BID ON THE RESOLICITATION.
THE CANCELLATION OF AN INVITATION FOR BIDS AFTER BID PRICES HAVE BEEN
EXPOSED MUST BE BASED ON COGENT AND COMPELLING REASONS. SCOTT GRAPHICS,
INCORPORATED, ET AL., 54 COMP.GEN. 973 (1975), 75-1 CPD 302; DEFENSE
ACQUISITION REGULATION (DAR) SECS. 2-404.1 (DEFENSE ACQUISITION CIRCULAR
NO. 76-17, SEPTEMBER 1, 1978). A CONTRACTING OFFICER HAS BROAD
DISCRETION IN DETERMINING WHETHER A COGENT AND COMPELLING REASON EXISTS,
MARMAC INDUSTRIES, INC., B-203377.5, JANUARY 8, 1982, 82-1 CPD 22, AND,
THUS, A DETERMINATION TO CANCEL A SOLICITATION IS NOT LEGALLY
OBJECTIONABLE UNLESS THERE CLEARLY IS NO REASONABLE BASIS FOR IT.
CENTRAL MECHANICAL, INC., B-206030, FEBRUARY 4, 1982, 82-1 CPD 91.
CHEMICAL HAS NOT SHOWN THAT THE DECISION TO CANCEL WAS UNREASONABLE.
IN OUR VIEW, THE CONTRACTING OFFICER ACTED REASONABLY AT THE TIME OF HER
DECISION TO CANCEL THE IFB BECAUSE OF THE PREMATURE BID OPENING, THE
ECOLOGIC PROTEST OF THAT OPENING, AND THE NUMBER OF POTENTIAL BIDDERS.
WHILE WE AGREE THAT QUAKER IS FACTUALLY DISTINGUISHABLE, THE RATIONALE
SUPPORTING CANCELLATION APPLIES HERE. CHEMICAL'S ARGUMENT CONCERNING
THE RESULTS OF THE RESOLICITATION HAS NO BEARING ON THE PROPRIETY OF THE
CANCELLATION OF THE INITIAL SOLICITATION. SEE NORDAM, DIVISION OF R.H.
SIEGFRIED, INC., B-189996, AUGUST 17, 1978, 78-2 CPD 126; PM
CONTRACTORS, INC., B-192495, JANUARY 8, 1979, 79-1 CPD 8; HERMES
PRODUCTS, INC., B-204487.3, JULY 6, 1982, 82-2 CPD 15. IN ANY EVENT, TO
THE EXTENT CHEMICAL HAS SHOWN THAT ONLY IT, ANACHEMIA, AND ECOLOGIC
ORDINARILY COMPETE FOR THIS REQUIREMENT, WE HAVE HELD THAT THE FAILURE
TO SOLICIT AN INCUMBENT CONTRACTOR, ONE OF A LIMITED NUMBER OF
MANUFACTURERS OF AN ITEM BEING PROCURED, SUPPORTS A DETERMINATION TO
CANCEL AN IFB AND READVERTISE. SCOTT GRAPHICS, INCORPORATED, SUPRA.
PROTEST DENIED.
B-210315, JAN 11, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
QUESTIONS CONCERNING SMALL BUSINESS SIZE STATUS WILL NOT BE
CONSIDERED BY GAO SINCE CONCLUSIVE AUTHORITY OVER SUCH MATTERS IS VESTED
BY STATUTE IN THE SMALL BUSINESS ADMINISTRATION.
ARCATA ASSOCIATES, INC.:
ARCATA ASSOCIATES, INC. PROTESTS THE AWARD OF A CONTRACT TO KLATE
HOLT CO. BY THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION UNDER
SOLICITATION NO. 1-20-5772.0038, A SMALL BUSINESS SET-ASIDE. ARCATA
CONTENDS THAT KLATE HOLT DOES NOT MEET THE APPLICABLE SMALL BUSINESS
SIZE STANDARD.
UNDER 15 U.S.C. SEC. 637(B)(6) (1976), THE SMALL BUSINESS
ADMINISTRATION HAS CONCLUSIVE AUTHORITY TO DETERMINE MATTERS OF SMALL
BUSINESS SIZE STATUS FOR PROCUREMENT PURPOSES. THEREFORE, OUR OFFICE
DOES NOT REVIEW QUESTIONS OF A BIDDER'S SMALL BUSINESS SIZE STATUS.
DOYLE SHIRT MANUFACTURING CORP., B-205959, JANUARY 11, 1982, 82-1 CPD
28.
THE PROTEST IS DISMISSED.
B-210314; B-210314.2, FEB 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. GAO WILL NOT CONSIDER PROTEST AGAINST SMALL BUSINESS SIZE
STANDARD IN SOLICITATION, SINCE SMALL BUSINESS ADMINISTRATION SIZE
APPEALS BOARD IS SOLE ADJUDICATOR OF SIZE STANDARD ISSUES.
2. GAO GENERALLY WILL DISMISS PROTEST ALLEGING THAT SMALL BUSINESS
BIDDER EXCEEDS SIZE LIMITATIONS CONTAINED IN SOLICITATION, SINCE SMALL
BUSINESS ADMINISTRATION HAS STATUTORY AUTHORITY TO DETERMINE SIZE STATUS
OF SMALL BUSINESSES FOR FEDERAL PROCUREMENT PURPOSES.
3. GAO WILL DISMISS PROTEST ALLEGING THAT SMALL BUSINESS BIDDER
CANNOT PERFORM AT BID PRICE, BECAUSE REJECTION OF BELOW-COST BID
REQUIRES A DETERMINATION THAT BIDDER IS NONRESPONSIBLE. IF CONTRACTING
AGENCY MAKES AFFIRMATIVE DETERMINATION OF RESPONSIBILITY, GAO WILL NOT
REVIEW IT EXCEPT IN CIRCUMSTANCES NOT PRESENT HERE; IF BIDDER IS FOUND
NONRESPONSIBLE, CONTRACTING AGENCY MUST REFER MATTER TO SMALL BUSINESS
ADMINISTRATION.
CONSOLIDATED MARKETING NETWORK, INC.; FOUR STAR MAINTENANCE
CORPORATION:
CONSOLIDATED MARKETING NETWORK, INC. AND FOUR STAR MAINTENANCE
CORPORATION PROTEST THE PROPOSED AWARD OF A CONTRACT FOR BASE HOUSING
REPAIR AND MAINTENANCE SERVICES AT BEALE AIR FORCE BASE, CALIFORNIA,
UNDER INVITATION FOR BIDS NO. F04666-82-B-0039. CONSOLIDATED ARGUES THAT
THE AIR FORCE APPLIED AN INCORRECT SIZE STANDARD FOR THIS PROCUREMENT,
WHILE FOUR STAR ALLEGES THAT ALLIANCE PROPERTIES, INC., THE LOW BIDDER,
EXCEEDS THE SMALL BUSINESS ADMINISTRATION (SBA) SIZE LIMITATIONS
CONTAINED IN THE SOLICITATION AND HAS BID TOO LOW TO BE CONSIDERED
RESPONSIVE TO THE CONTRACT REQUIREMENTS. WE DISMISS BOTH PROTESTS.
CONSOLIDATED SUPPORTS ITS CONTENTION WITH AN SBA SIZE APPEALS BOARD
DECISION PERTAINING TO A SOLICITATION FOR BASE HOUSING MAINTENANCE
ISSUED BY LANGLEY AIR FORCE BASE, VIRGINIA, ARGUING THAT THE CONTRACTING
OFFICER AT BEALE SHOULD HAVE SPECIFIED A SIZE STANDARD FOR SMALL
BUSINESS OF $2 MILLION IN AVERAGE ANNUAL RECEIPTS, NOT $7.5 MILLION.
UNDER 15 U.S.C. SEC. 637(B)(6) (1976), THE SBA HAS CONCLUSIVE
AUTHORITY TO DETERMINE A SMALL BUSINESS CONCERN'S SIZE STATUS FOR
PROCUREMENT PURPOSES. IN IMPLEMENTING REGULATIONS, 13 C.F.R. SEC.
121.3-8 (1982), THE SBA STATES:
"*** THE DETERMINATION OF THE APPROPRIATE CLASSIFICATION
OF A PRODUCT OR SERVICE SHALL BE MADE BY THE CONTRACTING
OFFICER. BOTH CLASSIFICATION AND THE APPLICABLE SIZE
STANDARD (NUMBER OF EMPLOYEES, AVERAGE ANNUAL
RECEIPTS, ETC.) SHALL BE SET FORTH IN THE
SOLICITATION AND SUCH DETERMINATION OF THE CONTRACTING
OFFICER SHALL BE MADE FINAL UNLESS APPEALED
IN THE MANNER PROVIDED IN SEC. 121.3-6 ***." THE CITED SECTION SETS
FORTH PROCEDURES BY WHICH THE SIZE APPEALS BOARD REVIEWS AND MAKES FINAL
DECISIONS AS TO CONTRACTING OFFICERS' DETERMINATIONS. THUS, IF
CONSOLIDATED BELIEVED THAT THE SIZE APPEALS BOARD'S DECISION CONCERNING
THE SOLICITATION ISSUED BY LANGLEY AIR FORCE BASE APPLIED TO THE
PROTESTED PROCUREMENT, IT SHOULD HAVE RAISED THIS ISSUE WITH THE BOARD
BEFORE THE DECEMBER 21, 1982 BID OPENING, AS SPECIFIED IN 13 C.F.R.
SEC. 121.3-6(B)(3)(II).
SIMILARLY, IF FOUR STAR WISHED TO CHALLENGE THE SIZE STATUS OF
ALLIANCE, IT SHOULD HAVE PROTESTED TO THE CONTRACTING OFFICER WITHIN 5
DAYS AFTER BID OPENING, IN ACCORD WITH 13 C.F.R. SEC. 121.3-5(A). THE
CONTRACTING OFFICER WOULD HAVE REFERRED THE MATTER TO THE SBA REGIONAL
DIRECTOR, WHOSE DECISION, IF ADVERSE, ALSO COULD HAVE BEEN APPEALED TO
THE BOARD WITHIN 5 DAYS UNDER 13 C.F.R. SEC. 121.3-6(B)(3)(I). IT
APPEARS THAT NEITHER FIRM FOLLOWED THESE PROCEDURES WITHIN THE TIMES
SPECIFIED; IN ANY EVENT, OUR OFFICE WILL NOT CONSIDER THEIR PROTESTS.
FOUR STAR ALSO STATES THAT ALLIANCE'S BID IS 10 PERCENT LOWER THAN
ITS OWN, AND ARGUES THAT THE GOVERNMENT MAY BE OBLIGED TO TERMINATE ANY
CONTRACT AWARDED TO ALLIANCE BECAUSE OF POOR PERFORMANCE AND MONETARY
PROBLEMS. WE FREQUENTLY HAVE STATED THAT A BELOW-COST BID PROVIDES NO
BASIS FOR CHALLENGING THE AWARD OF A GOVERNMENT CONTRACT TO A
RESPONSIBLE PROSPECTIVE CONTRACTOR. DRAGON SERVICES, INC., B-208081,
JULY 27, 1982, 82-2 CPD 86. IF THE AIR FORCE FINDS THAT ALLIANCE IS
RESPONSIBLE, WHICH IT MUST DO BEFORE AWARDING THE CONTRACT, THIS WOULD
CONSTITUTE AN AFFIRMATIVE DETERMINATION OF RESPONSIBILITY. BECAUSE SUCH
DETERMINATIONS ARE LARGELY SUBJECTIVE BUSINESS JUDGMENTS, OUR OFFICE
DOES NOT REVIEW THEM ABSENT A SHOWING OF POSSIBLE FRAUD ON THE PART OF
PROCURING OFFICIALS OR AN ALLEGATION THAT DEFINITIVE RESPONSIBILITY
CRITERIA CONTAINED IN THE SOLICITATION WERE NOT APPLIED. GUARDIAN
SECURITY AGENCY, INC., B-209694, NOVEMBER 22, 1982, 82-2 CPD 471.
ON THE OTHER HAND, IF ALLIANCE IS FOUND NONRESPONSIBLE AND IT IS A
SMALL BUSINESS, THE AIR FORCE MUST REFER THE MATTER TO THE SBA, WHICH
WILL CONCLUSIVELY RESOLVE THE MATTER BY ISSUING OR REFUSING TO ISSUE A
CERTIFICATE OF COMPETENCY. OUR REVIEW HERE ALSO IS LIMITED TO CASES
INVOLVING BAD FAITH. TECHNICAL FOOD SERVICES, INC., B-203742.2,
SEPTEMBER 15, 1981, 81-2 CPD 219. FOUR STAR HAS NOT ALLEGED THAT ANY OF
THESE EXCEPTIONS APPLIES; THEREFORE, WE WILL NOT CONSIDER THE PROTEST
ON THIS BASIS.
THE PROTESTS ARE DISMISSED.
B-210314.3, MAR 9, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE AN APPEAL OF THE SMALL BUSINESS SIZE STATUS WAS NOT FILED
WITHIN 5 DAYS OF BID OPENING, THE AGENCY WAS NOT REQUIRED TO SUSPEND
CONTRACTING ACTION FOR THE PRESCRIBED REGULATORY PERIOD.
2. AGENCY WAS NOT REQUIRED TO WITHHOLD AWARD PENDING A SMALL
BUSINESS ADMINISTRATION SIZE APPEALS BOARD POST-BID OPENING RULING ON AN
APPEAL OF THE SMALL BUSINESS SIZE STANDARD CONTAINED IN THE SOLICITATION
BECAUSE THE RULING HAS PROSPECTIVE EFFECT ONLY.
FOUR STAR MAINTENANCE CORPORATION - RECONSIDERATION:
FOUR STAR MAINTENANCE CORPORATION REQUESTS RECONSIDERATION OF
CONSOLIDATED MARKETING NETWORK, INC.; FOUR STAR MAINTENANCE CORPORATION,
B-210314; B-210314.2, FEBRUARY 7, 1983, 83-1 CPD , IN WHICH WE
DISMISSED FOUR STAR'S PROTEST AGAINST THE PROPOSED AWARD OF A CONTRACT
FOR BASE HOUSING REPAIR AND MAINTENANCE SERVICES AT BEALE AIR FORCE
BASE, CALIFORNIA, UNDER INVITATION FOR BIDS NO. F04666-82-B-0039. WE
AFFIRM OUR PRIOR DECISION.
FOUR STAR REQUESTS RECONSIDERATION OF ITS ALLEGATION THAT THE LOW
BIDDER, AND ULTIMATE AWARDEE, UNDER THE INVITATION EXCEEDED THE SMALL
BUSINESS SIZE LIMITATION CONTAINED IN THE SOLICITATION. IN DISMISSING
THE ALLEGATION IN THE ORIGINAL DECISION, WE POINTED OUT THAT THE SMALL
BUSINESS ADMINISTRATION (SBA) HAS CONCLUSIVE AUTHORITY TO DETERMINE A
SMALL BUSINESS CONCERN'S SIZE STATUS FOR PROCUREMENT PURPOSES. 15 U.S.
C. SEC. 637(B)(6) (1976). IN THIS REGARD, WE NOTED THAT IF FOUR STAR
WISHED TO CHALLENGE THE SIZE STATUS OF THE LOW BIDDER, IT SHOULD HAVE
PROTESTED TO THE CONTRACTING OFFICER WITHIN 5 DAYS AFTER BID OPENING, IN
ACCORD WITH SBA REGULATIONS AT 13 C.F.R. SEC. 121.3-5(A) (1982). WE
NOTED FURTHER THAT THE CONTRACTING OFFICER WOULD HAVE REFERRED THE
MATTER TO THE SBA REGIONAL DIRECTOR, WHOSE DECISION, IF ADVERSE, ALSO
COULD HAVE BEEN APPEALED TO THE SBA SIZE APPEALS BOARD WITHIN 5 DAYS
UNDER 13 C.F.R. SEC. 121.3-6(B)(3)(I). WE CONCLUDED OUR DISCUSSION OF
THIS ALLEGATION BY STATING THAT IT APPEARED THAT NO TIMELY SIZE STATUS
APPEALS WERE LODGED WITH THE CONTRACTING OFFICER OR SBA IN THIS CASE,
AND THAT, IN ANY EVENT, OUR OFFICE WOULD NOT CONSIDER A PROTEST
CONCERNING A SMALL BUSINESS SIZE STATUS APPEAL.
FOUR STAR NOW ADVISES US THAT IT AND CONSOLIDATED MAINTENANCE, THE
OTHER NAMED PARTY IN THE ORIGINAL PROTEST, DID IN FACT LODGE APPEALS
WITH THE CONTRACTING AGENCY AND THE SBA. FOUR STAR STATES THAT
CONSOLIDATED APPEALED THE SOLICITATION'S SIZE STANDARD FOR SMALL
BUSINESS SEVERAL MONTHS PRIOR TO THE DECEMBER 21, 1982, BID OPENING.
FOUR STAR ADVISES US THAT ITS FIRST ADMINISTRATIVE APPEAL OF THE SMALL
BUSINESS SIZE STATUS OF THE LOW BIDDER WAS MADE ON DECEMBER 31.
ESSENTIALLY, THEREFORE, FOUR STAR CONTENDS THAT THE AIR FORCE IMPROPERLY
AWARDED A CONTRACT ON FEBRUARY 15 WITHOUT AWAITING A DECISION OF THE SBA
SIZE APPEALS BOARD WHICH WAS SCHEDULED TO BEGIN CONSIDERATION OF THE
MATTERS RAISED BY FOUR STAR AND CONSOLIDATED ON FEBRUARY 22.
THE PROCUREMENT REGULATIONS REQUIRE A CONTRACTING OFFICER TO SUSPEND
CONTRACTING ACTION FOR A PRESCRIBED TIME PENDING A SIZE APPEALS BOARD
RULING UNLESS URGENT AWARD IS NECESSARY TO PROTECT THE PUBLIC INTEREST.
DEFENSE ACQUISITION REGULATION (DAR) SEC. 1-703(B)(3) (DAC 76-19, JULY
27, 1979). THE REGULATION ONLY APPLIES, HOWEVER, IF AN INITIAL SIZE
STATUS PROTEST FOR THAT PROCUREMENT WAS TIMELY FILED WITH THE
CONTRACTING OFFICER, THAT IS, WITHIN 5 DAYS AFTER BID OPENING. DAR SEC.
1-703(B)(1); 13 C.F.R. SEC. 121.3-5(A). IN THIS CASE, FOUR STAR'S
DECEMBER 31 APPEAL OF THE SMALL BUSINESS SIZE STATUS OF THE LOW BIDDER
WAS NOT FILED WITHIN 5 DAYS OF THE DECEMBER 21 BID OPENING, AND
THEREFORE THE AIR FORCE WAS NOT REQUIRED TO WITHHOLD AWARD PENDING AN
SBA RULING.
MOREOVER, THE AIR FORCE WAS NOT REQUIRED TO WITHHOLD AWARD PENDING
THE OUTCOME OF CONSOLIDATED'S APPEAL OF THE SMALL BUSINESS SIZE STANDARD
CONTAINED IN THE SOLICITATION. IN THIS REGARD, DAR SEC. 1-703(C)(3)
(DAC 76-34, APRIL 27, 1982) PROVIDES THAT IF AN SBA SIZE APPEALS BOARD
RULING IS RECEIVED BY A CONTRACTING AGENCY AFTER BID OPENING, THE
DECISION WILL NOT APPLY TO THE CURRENT PROCUREMENT, BUT WILL HAVE
PROSPECTIVE EFFECT ONLY. SEE BAIRD CORPORATION, B-210136, DECEMBER 29,
1982, 82-2 CPD 556. THUS, ANY POST-BID OPENING RULING BY THE SBA BOARD
WOULD NOT AFFECT THE AIR FORCE'S FEBRUARY 15 AWARD.
OUR PRIOR DECISION IS AFFIRMED.
B-210314.4, JUN 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
SMALL BUSINESS ADMINISTRATION HAS CONCLUSIVE AUTHORITY TO DETERMINE
SMALL BUSINESS SIZE STATUS FOR FEDERAL PROCUREMENT PURPOSES.
FOUR STAR MAINTENANCE CORPORATION - SECOND RECONSIDERATION REQUEST:
FOUR STAR MAINTENANCE CORPORATION REQUESTS, FOR THE SECOND TIME,
RECONSIDERATION OF OUR DECISION IN CONSOLIDATED MARKETING NETWORK, INC.;
FOUR STAR MAINTENANCE CORPORATION, B-210314; B-210314.2, FEBRUARY 7,
1983, 83-1 CPD 134, IN WHICH WE DISMISSED FOUR STAR'S PROTEST AGAINST
THE PROPOSED AWARD OF A CONTRACT FOR BASE HOUSING REPAIR AND MAINTENANCE
SERVICES AT BEALE AIR FORCE BASE, CALIFORNIA, UNDER INVITATION FOR BIDS
NO. F04666-82-B-0039. WE AFFIRMED THE DECISION ON MARCH 9, 1983 IN
RESPONSE TO FOUR STAR'S FIRST REQUEST. FOUR STAR MAINTENANCE
CORPORATION - RECONSIDERATION, B-210314.3, MARCH 9, 1983, 83-1 CPD 240.
WE AGAIN AFFIRM OUR FEBRUARY DECISION.
THE BASIS FOR FOUR STAR'S ORIGINAL PROTEST AND SUBSEQUENT REQUEST FOR
RECONSIDERATION WAS THE ALLEGATION THAT THE LOW BIDDER AND ULTIMATE
AWARDEE, ALLIANCE PROPERTIES, INC., DID NOT MEET THE SMALL BUSINESS SIZE
STANDARD CONTAINED IN THE SOLICITATION. WE NOTED IN BOTH DECISIONS THAT
THE SMALL BUSINESS ADMINISTRATION (SBA) HAS CONCLUSIVE AUTHORITY TO
DETERMINE A CONCERN'S SMALL BUSINESS SIZE STATUS FOR PROCUREMENT
PURPOSES. 15 U.S.C. SEC. 637 (B)(6) (1976). FURTHER, WE STRESSED THAT
IF FOUR STAR HAD WISHED TO CHALLENGE THE SIZE STATUS OF THE EVENTUAL
AWARDEE, IT SHOULD HAVE PROTESTED TO THE CONTRACTING OFFICER WITHIN 5
DAYS AFTER BID OPENING, IN ACCORDANCE WITH SBA REGULATIONS AT 13 C.F.R.
SEC. 121.3-5(A) (1982). IN THE EVENT OF A TIMELY PROTEST, THE
CONTRACTING OFFICER WOULD HAVE REFERRED THE MATTER TO THE SBA REGIONAL
DIRECTOR, WHOSE DECISION, IF ADVERSE, COULD HAVE BEEN APPEALED TO THE
SBA SIZE APPEALS BOARD WITHIN 5 DAYS UNDER 13 C.F. R. SEC.
121.3-6(B)(3)(I). (IT APPEARED FROM THE RECORD BEFORE US THAT NO TIMELY
SIZE STATUS CHALLENGE WAS FILED BY FOUR STAR WITH EITHER THE CONTRACTING
OFFICER OR THE SBA.) WE ALSO STATED THAT, IN ANY EVENT, OUR OFFICE WOULD
NOT CONSIDER A SMALL BUSINESS SIZE STATUS COMPLAINT.
FOUR STAR NOW ALLEGES THAT THE COMPLAINTS BY CONSOLIDATED MARKETING
NETWORK, INC., TO THE SIZE APPEALS BOARD ON SEPTEMBER 23, 1982, AND TO
BOTH THE CONTRACTING OFFICER AND THIS OFFICE ON DECEMBER 23, 1982,
CONSTITUTED TIMELY FILINGS WITHIN THE MEANING OF 13 C.F.R. SEC.
121.3-5(A). WE DO NOT AGREE. THE RECORD CLEARLY SHOWS THAT THOSE
COMPLAINTS CONCERNED THE SMALL BUSINESS SIZE STANDARD ANNOUNCED IN THE
SOLICITATION AS APPLICABLE TO THE PROCUREMENT, AND WERE NOT PROTESTS
REGARDING THE EVENTUAL AWARDEE'S SIZE STATUS. IT ALSO IS CLEAR THAT
FOUR STAR DID NOT PROTEST THE SIZE STATUS IN ISSUE UNTIL DECEMBER 31,
1982, 10 DAYS AFTER BID OPENING. THEREFORE, ITS PROTEST WAS NOT TIMELY
FILED WITHIN THE 5-DAY PERIOD SPECIFIED IN 13 C.F.R. 121.3-5(A).
IN ANY CASE, WE AGAIN STRESS THAT OUR OFFICE WILL NOT CONSIDER A
PROTEST CONCERNING A SMALL BUSINESS CONCERN'S SIZE STATUS, AS THE SMALL
BUSINESS ACT GIVES THE SBA CONCLUSIVE AUTHORITY IN SUCH MATTERS.
ACCORDINGLY, WE AGAIN AFFIRM OUR INITIAL DECISION.
B-210309, FEB 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
REQUEST FOR BID PREPARATION COSTS BASED ON MATTERS NOT TIMELY
PROTESTED WILL NOT BE CONSIDERED.
EMERSON INDUSTRIAL CONTROLS:
EMERSON INDUSTRIAL CONTROLS (EMERSON) REQUESTS BID PREPARATION COSTS
AS A REMEDY FOR THE VETERANS ADMINISTRATION'S (VA) CANCELLATION OF
INVITATION FOR BIDS (IFB) NO. 633-19-83 AFTER BID OPENING.
WE DISMISS THE CLAIM BECAUSE IT IS BASED ON MATTERS THAT WERE NOT
TIMELY PROTESTED.
EMERSON RECEIVED THE NOTICE OF VA'S CANCELLATION OF THE IFB ON
NOVEMBER 1, 1982. BY LETTER TO THE VA DATED NOVEMBER 24, 1982, EMERSON
PROTESTED THAT THE CANCELLATION WAS ARBITRARY AND CAPRICIOUS, AND
REQUESTED BID PREPARATION COSTS. ON DECEMBER 28, 1982, EMERSON FILED
ITS CLAIM AT THE GENERAL ACCOUNTING OFFICE BECAUSE VA HAD NOT RESPONDED
IN WHAT EMERSON CONSIDERED A TIMELY FASHION.
GAO WILL NOT CONSIDER A CLAIM FOR BID PREPARATION COSTS WHICH IS
BASED ON ISSUES RAISED IN AN UNTIMELY PROTEST. MIL-AIR, INC., B-191424,
JULY 20, 1978, 78-2 CPD 55; DWC LEASING COMPANY, B-186481, NOVEMBER 12,
1976, 76-2 CPD 404. SECTION 21.2(A) OF OUR BID PROTEST PROCEDURES, 4
C.F.R. SEC. 21.2(A) (1982), PROVIDES THAT GAO WILL CONSIDER A SUBSEQUENT
PROTEST THAT WAS INITIALLY FILED WITH THE CONTRACTING AGENCY ONLY IF THE
INITIAL PROTEST WAS TIMELY FILED. TO BE TIMELY FILED, A PROTEST MUST BE
FILED WITH THE AGENCY WITHIN 10 WORKING DAYS OF THE DATE THAT THE
PROTESTER WAS AWARE OF THE BASIS FOR ITS PROTEST. 4 C.F.R. SEC.
21.2(B).
THE BASIS FOR EMERSON'S PROTEST AND REQUEST FOR BID PREPARATION COSTS
WAS KNOWN TO IT ON NOVEMBER 1, 1982, YET EMERSON DID NOT FILE ITS
PROTEST AND REQUEST WITH VA UNTIL SOMETIME AFTER NOVEMBER 24, 1982, MORE
THAN 10 WORKING DAYS LATER.
SINCE THE REQUEST FOR BID PREPARATION COSTS IS BASED ON MATTERS NOT
TIMELY PROTESTED IT IS DISMISSED.
B-210308.9, NOV 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST OF AN AGENCY'S REJECTION OF BID FOR
FAILURE TO ACKNOWLEDGE AN AMENDMENT IS
UNTIMELY WHERE FILED ON THE 11TH WORKING DAY
AFTER THE PROTESTER LEARNED THE BASIS FOR
PROTEST.
ABM SERVICE COMPANY:
ABM SERVICE COMPANY PROTESTS THE NAVY'S REJECTION OF ITS BID TO
PROVIDE COMMISSARY SHELF-STOCKING SERVICES UNDER INVITATION FOR BIDS NO.
N00612-83-B-0002. ACCORDING TO THE PROTESTER, IT WAS IN LINE FOR AN
AWARD OF LOT II UNDER THE INVITATION, COVERING SERVICES AT A NAVAL
SUPPLY CENTER ACTIVITY IN NEW ORLEANS. THE NAVY REJECTED THE BID AS
NONRESPONSIVE, HOWEVER, FOR FAILURE TO ACKNOWLEDGE AN AMENDMENT TO THE
INVITATION, AND AWARDED A CONTRACT FOR LOT II TO ANOTHER BIDDER. WE
DISMISS THE PROTEST AS UNTIMELY.
TO BE TIMELY, THE PROTEST HAD TO HAVE BEEN FILED - THAT IS, RECEIVED
BY THIS OFFICE - WITHIN 10 WORKING DAYS AFTER THE BASIS FOR PROTEST WAS
KNOWN, OR SHOULD HAVE BEEN KNOWN, WHICHEVER WAS EARLIER. 4 C.F.R. SEC.
21.2(B)(2) AND (3) (1983). THE RECORD, HOWEVER, SHOWS THAT ABM FILED
ITS PROTEST AFTER THE 10-DAY PERIOD EXPIRED.
BY A LETTER DATED SEPTEMBER 27, 1983, THE NAVY INFORMED THE PROTESTER
THAT IT HAD REJECTED ABM'S BID AND OF THE REASON FOR THE REJECTION, AND
THAT THE NAVY HAD AWARDED A CONTRACT COVERING LOT II TO ANOTHER BIDDER.
THE PROTESTER'S SUBMISSION TO THIS OFFICE, DATED OCTOBER 18, STATES THAT
ABM LEARNED OF THE AWARD ON OCTOBER 3, THUS INDICATING THAT ABM RECEIVED
THE NAVY'S LETTER ON OR BEFORE THAT DATE. THIS OFFICE'S TIME STAMP AND
NOTATION ON THE SUBMISSION SHOW THAT THE PROTEST HAD BEEN HAND-CARRIED
AND WAS RECEIVED AT THE GENERAL ACCOUNTING OFFICE ON OCTOBER 19, THE
11TH WORKING DAY AFTER THE PROTESTER ADMITS HAVING LEARNED THE BASIS FOR
PROTEST. ABM'S PROTEST THEREFORE IS UNTIMELY.
THE PROTEST IS DISMISSED.
B-210304, FEB 7, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST FILED AFTER BID OPENING AGAINST CONTRACTING AGENCY
FAILURE TO EXTEND BID OPENING DUE TO PROTESTER'S APPEAL OF SMALL
BUSINESS SIZE STANDARD IN INVITATION TO SIZE APPEALS BOARD IS UNTIMELY
AND NOT FOR CONSIDERATION.
2. SIZE APPEALS BOARD RULING WHICH IS RECEIVED BY CONTRACTING AGENCY
AFTER BID OPENING APPLIES ONLY TO FUTURE ACQUISITIONS.
3. PROTESTER'S REQUEST FOR CONFERENCE ON PROTEST IS DENIED SINCE
CONFERENCE WOULD SERVE NO USEFUL PURPOSE.
DYNETERIA, INC.:
DYNETERIA, INC., PROTESTS AFTER BID OPENING THAT THE BID OPENING ON
NAVAL AMPHIBIOUS BASE (LITTLE CREEK) INVITATION FOR BIDS (IFB) NO.
N62470-82-B-3938 SHOULD HAVE BEEN EXTENDED BECAUSE OF DYNETERIA'S
PRE-BID-OPENING APPEAL OF THE SMALL BUSINESS SIZE STANDARD IN THE IFB TO
THE SMALL BUSINESS SIZE APPEALS BOARD AND THAT AN AWARD SHOULD BE
DELAYED UNTIL THE SIZE APPEALS BOARD RENDERS A DECISION.
A PROTEST AGAINST AN IFB BID OPENING TIME FILED AFTER BID OPENING IS
UNTIMELY AND NOT FOR CONSIDERATION. SIGMA CONSULTANTS, INC., MAY 14,
1979, 79-1 CPD 350; ENVIRONMENTAL TECTONICS CORPORATION, B-193108,
FEBRUARY 15, 1979, 79-1 CPD 113; BILL CONKLIN ASSOCIATES, INC.,
B-191148, FEBRUARY 17, 1978, 78-1 CPD 144.
FURTHER, DEFENSE ACQUISITION REGULATION SEC. 1-703(C)(3) (1976 ED.)
PROVIDES THAT A SIZE APPEALS BOARD RULING WHICH IS RECEIVED BY THE
CONTRACTING AGENCY AFTER BID OPENING SHALL NOT APPLY TO THE CURRENT
ACQUISITION, BUT ONLY TO FUTURE ACQUISITIONS.
ACCORDINGLY, WE DISMISS THE PROTEST.
DYNETERIA'S REQUEST FOR A CONFERENCE ON THE PROTEST IS DENIED SINCE,
IN LIGHT OF THE ABOVE, IT WOULD SERVE NO USEFUL PURPOSE. GATEWAY
WAREHOUSE SERVICES CORP., B-208350, AUGUST 17, 1982, 82-2 CPD 141.
B-210299 L/M, JAN 7, 1983, OFFICE OF GENERAL COUNSEL
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
MS. FRANCINE HANSON:
THIS IS IN REFERENCE TO YOUR LETTER OF NOVEMBER 22, 1982 URGING THE
PRESIDENT TO ORDER US TO RETROACTIVELY DEDUCT FROM THE WAGES OF EACH
MEMBER OF CONGRESS THE AMOUNT OF THOSE WAGES FOR EACH DAY THAT A MEMBER
HAS BEEN ABSENT FROM THE SENATE OR THE HOUSE OF REPRESENTATIVES. THE
OFFICE OF PERSONNEL MANAGEMENT RECENTLY FORWARDED YOUR LETTER TO US FOR
CONSIDERATION AND REPLY.
YOU STATE THAT THE APPLICABLE PROVISION OF LAW PRECLUDES PAYMENT OF
MEMBERS FOR THOSE DAYS THEY ARE DETERMINED TO HAVE BEEN ABSENT FROM
CONGRESS WITHOUT AN EXCUSE. THE STATUTORY BASIS FOR MAKING NECESSARY
DEDUCTIONS FROM MEMBERS' PAY FOR UNEXCUSED ABSENCES FROM CONGRESS IS SET
FORTH IN 2 U.S.C. SEC. 39 (1976), WHICH PROVIDES AS FOLLOWS:
"THE SECRETARY OF THE SENATE AND SERGEANT
AT ARMS OF THE HOUSE, RESPECTIVELY, SHALL
DEDUCT FROM THE MONTHLY PAYMENTS (OR OTHER
PERIODIC PAYMENTS AUTHORIZED BY LAW) OF EACH
MEMBER OR DELEGATE THE AMOUNT OF HIS SALARY FOR
EACH DAY THAT HE HAS BEEN ABSENT FROM THE
SENATE OR HOUSE, RESPECTIVELY, UNLESS SUCH
MEMBER OR DELEGATE ASSIGNS AS THE REASON FOR
SUCH ABSENCE THE SICKNESS OF HIMSELF OR OF SOME
MEMBER OF HIS FAMILY."
ADDITIONALLY, THE PROVISIONS CONCERNING CERTIFICATION OF THE SALARY
ACCOUNT ARE CONTAINED IN 2 U.S.C. SEC. 48, WHICH STATES:
"SALARY AND MILEAGE ACCOUNTS OF SENATORS
SHALL BE CERTIFIED BY THE PRESIDENT OF THE
SENATE, AND THOSE OF REPRESENTATIVES AND
DELEGATES BY THE SPEAKER OF THE HOUSE OF
REPRESENTATIVES; AND SUCH CERTIFICATES SHALL BE
CONCLUSIVE UPON ALL THE DEPARTMENTS AND OFFICERS
OF THE GOVERNMENTS."
SECTION 39 SPECIFICALLY MAKES THE SECRETARY OF THE SENATE AND
SERGEANT AT ARMS OF THE HOUSE, AND NOT THE PRESIDENT, RESPONSIBLE FOR
DETERMINING IF MEMBERS OF THEIR RESPECTIVE HOUSES OF CONGRESS HAVE BEEN
ABSENT WITHOUT AN EXCUSE AND DEDUCTING THE PROPER AMOUNTS FROM THEIR
SALARY PAYMENTS. MOREOVER, WITH RESPECT TO RETROACTIVE DEDUCTIONS, ONCE
SUCH SALARY PAYMENTS HAVE BEEN CERTIFIED BY THE APPROPRIATE
CONGRESSIONAL OFFICERS THE CERTIFICATES ARE CONCLUSIVE UPON ALL THE
DEPARTMENTS AND OFFICERS OF THE GOVERNMENT. SEE 2 U.S.C. SEC. 48
(1976). IN OTHER WORDS, SUCH PAYMENTS MAY NOT BE QUESTIONED BY THIS
OFFICE.
WE HOPE THIS INFORMATION WILL BE OF SOME ASSISTANCE TO YOU.
B-210297, JUL 12, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. INTERNAL REVENUE SERVICE EMPLOYEE MAY NOT BE REIMBURSED COST OF
1-YEAR HOMEGUARD SERVICE CONTRACT INCURRED UPON SALE OF HIS HOME
INCIDENT TO TRANSFER FROM COLUMBUS, OHIO, TO CINCINNATI, OHIO.
HOMEGUARD CONTRACT IS INSURANCE AGAINST SELLER'S CONTINGENT LIABILITY
FOR DEFECTS IN HOME AND HENCE IS NOT ALLOWABLE UNDER PARA. 2-6.2D,
FEDERAL TRAVEL REGULATIONS (FPMR 101-7), WHICH PRECLUDES REIMBURSEMENT
OF INSURANCE EXPENSES.
2. INTERNAL REVENUE SERVICE EMPLOYEE PURCHASED NEW RESIDENCE AND
SELLER AGREED TO PAY CLOSING COSTS. DESPITE THIS CONTRACT PROVISION,
THE EMPLOYEE PAID MOST OF THE CLOSING COSTS AND CLAIMS ATTORNEY FEES IN
CONNECTION WITH THE TRANSACTION. IN ACCORDANCE WITH GEORGE W. LAY, 56
COMP.GEN. 561 (1977), THE EMPLOYEE IS ENTITLED TO REASONABLE ATTORNEY
FEES FOR ADVISORY AND REPRESENTATIONAL SERVICES RENDERED IN CONNECTION
WITH THE PURCHASE OF A RESIDENCE AT NEW DUTY STATION IF THE CHARGES ARE
CUSTOMARILY PAID BY THE PURCHASER OF A RESIDENCE IN THE LOCALITY
INVOLVED AND ARE WITHIN THE CUSTOMARY RANGE OF CHARGES FOR SUCH SERVICES
IN THE LOCALITY.
DANIEL J. EVERMAN - REAL ESTATE EXPENSES:
THE ISSUE IN THIS DECISION INVOLVES AN EMPLOYEE'S CLAIMS INCIDENT TO
A PERMANENT CHANGE OF STATION FOR REIMBURSEMENT FOR A HOMEGUARD SERVICE
CONTRACT THAT HE PURCHASED UPON THE SALE OF HIS HOME AT THE OLD DUTY
STATION AND FOR ATTORNEY FEES INCURRED IN HIS PURCHASE OF A RESIDENCE AT
THE NEW DUTY STATION. WE CONCLUDE THAT THE EMPLOYEE IS NOT ENTITLED TO
THE EXPENSE FOR THE HOMEGUARD SERVICE CONTRACT WHICH IS INSURANCE TO THE
BUYER AGAINST REPAIRS OR MAINTENANCE, BUT THAT HE IS ENTITLED TO
REIMBURSEMENT OF REASONABLE ATTORNEY FEES EVEN THOUGH THE CONTRACT
PROVIDED THAT THE SELLER WOULD PAY ALL CLOSING COSTS SINCE, IN FACT, THE
BUYER (EMPLOYEE) PAID MOST OF THE CLOSING COSTS AT SETTLEMENT.
THIS ACTION IS IN RESPONSE TO THE REQUEST OF V. G. LEIST, AN
AUTHORIZED CERTIFYING OFFICER OF THE INTERNAL REVENUE SERVICE,
DEPARTMENT OF THE TREASURY, FOR A DECISION CONCERNING THE CLAIM OF AN
EMPLOYEE, MR. DANIEL J. EVERMAN, FOR CERTAIN EXPENSES INCURRED IN
CONNECTION WITH A PERMANENT CHANGE OF STATION FROM COLUMBUS, OHIO, TO
CINCINNATI, OHIO, EFFECTIVE FEBRUARY 8, 1982.
HOMEGUARD SERVICE CONTRACT
BASED UPON ADVICE FROM THE REGIONAL HOUSING AND URBAN DEVELOPMENT
(HUD) OFFICE, THE CERTIFYING OFFICER DISALLOWED MR. EVERMAN'S CLAIM OF
$250 FOR A HOMEGUARD SERVICE CONTRACT. HUD ADVISED THAT THE PURCHASE OF
HOMEGUARD SERVICE CONTRACT IN CONNECTION WITH THE SALE OF RESIDENCE IS A
FORM OF INSURANCE PROTECTION FOR THE SELLER AND NOT A CUSTOMARY EXPENSE
REIMBURSABLE UNDER PARA. 2-6.2F OF THE FEDERAL TRAVEL REGULATIONS (FPMR
101-7) (FTR) (SEPTEMBER 28, 1981). MR. EVERMAN, HOWEVER, CLAIMS THAT THE
PURCHASE OF THE HOMEGUARD SERVICE CONTRACT IS A CUSTOMARY EXPENSE UNDER
THE INTERNAL REVENUE MANUAL (IRM), CHAPTER 593(1)(G), A RESTATEMENT OF
THE ABOVE REGULATION, BECAUSE THE REALTOR'S "PURCHASE AND SALE AND
EXCHANGE CONTRACT" REQUIRED THE SELLER TO PROVIDE THE BUYER WITH A
HOMEGUARD SERVICE CONTRACT.
IN JOHN D. GARRITY, B-193578, AUGUST 20, 1979, WE CONCLUDED THAT A
HOMEGUARD MAINTENANCE SERVICE CONTRACT PURCHASED IN CONNECTION WITH THE
SALE OF A HOUSE IN THE SAME LOCALITY (COLUMBUS, OHIO) IS AN INSURANCE
CONTRACT TO PROVIDE MAINTENANCE SERVICES AND, AS SUCH, IT MAY NOT BE
PAID SINCE FTR. 2-6.2D PRECLUDES REIMBURSING THE PURCHASER FOR INSURANCE
EXPENSES, INCLUDING INSURANCE AGAINST DAMAGE OR LOSS OF PROPERTY. IN
GARRITY, WE EXPLAINED:
"THE PURCHASE OF HOMEGUARD IS A SEPARATE
CHARGE FOR BUYING INSURANCE TO ELIMINATE THE
SELLER'S CONTINGENT LIABILITY TO THE BUYER FOR
DEFECTS IN THE HOME. ALTHOUGH IN THIS CASE IT
IS THE SELLER WHO IS PURCHASING THE INSURANCE
CONTRACT, WE CONSTRUE THE INTENT OF THE PROHIBITION
IN FTR 2-6.2D TO BE APPLICABLE TO THE
SELLER AS WELL AS THE PURCHASER. HENCE, THE
INSURANCE EXPENSES FOR PURCHASING HOMEGUARD
MAY NOT BE REIMBURSED TO THE SELLER. MOREOVER,
SINCE THE INSURANCE IN QUESTION IS TO
PROVIDE PROTECTION AGAINST FUTURE MAINTENANCE
COSTS, REIMBURSEMENT IS ALSO PRECLUDED BY THE
PROVISION IN FTR 2-6.2D EXCLUDING THE
REIMBURSEMENT OF MAINTENANCE COSTS TO EITHER
THE SELLER OR PURCHASER. SEE VINCENT A. CROVETTI,
B-189662, OCTOBER 4, 1977. IN THIS
CONNECTION WE POINT OUT THAT THE COST OF THE
HOMEGUARD CONTRACT MAY NOT BE ALLOWED AS A
MISCELLANEOUS EXPENSE UNDER FTR CHAPTER 2,
PART 3, SINCE FTR 2-3.1C PROVIDES THAT THE
ALLOWANCE SHALL NOT BE USED TO REIMBURSE THE
EMPLOYEE FOR EXPENSES INCURRED WHICH ARE
DISALLOWED ELSEWHERE IN THE FTR."
THEREFORE, MR. EVERMAN MAY NOT BE REIMBURSED FOR THE $250 EXPENSE OF THE
HOMEGUARD SERVICE CONTRACT.
ATTORNEY FEES
MR. EVERMAN ALSO CLAIMS ATTORNEY FEES IN THE AMOUNT OF $520 THAT WERE
PAID FOR LEGAL SERVICES PROVIDED IN CONNECTION WITH HIS PURCHASE AT HIS
NEW DUTY STATION. THE STATEMENT FROM MR. EVERMAN'S ATTORNEY INDICATES
THAT THE SERVICES INCLUDED REVIEW AND IMPLEMENTATION OF THE PURCHASE
CONTRACT, CONTACTS WITH REPRESENTATIVES OF THE SELLER, REPRESENTATION UP
TO AND AT THE CLOSING, AND A TITLE OPINION ANALYSIS OF THE PROPERTY.
THE AGENCY DISALLOWED THE ENTIRE CLAIM BASED UPON A CONDITION IN THE
"CONSTRUCTION AND PURCHASE" AGREEMENT WHICH REQUIRES THAT THE SELLER PAY
"ALL LEGAL CLOSING COSTS." FURTHER, THE LOCAL HUD OFFICE ADVISED THE
AGENCY THAT SINCE THE PURCHASE CONTRACT CONTAINED THE ABOVE PROVISION,
ATTORNEY SERVICES WERE OPTIONAL AND NOT A NECESSARY EXPENSE.
THE CLOSING COSTS WHICH ARE LISTED ON THE "SETTLEMENT STATEMENT"
INDICATE THAT THE SELLER PAID THE BROKER'S COMMISSION, THE LOAN DISCOUNT
FEE, AND THE STATE TAX AND STAMPS ($9,391.04) WHILE THE BUYER (MR.
EVERMAN) PAID THE LOAN ORIGINATION FEE, APPRAISAL AND CREDIT REPORT
FEES, LENDER'S INSPECTION FEE, SETTLEMENT OR CLOSING FEE, TITLE
EXAMINATION AND TITLE INSURANCE BINDER FEES, TITLE INSURANCE, RECORDING
FEES, AND OTHER EXPENSES ($4,457.41). NOTWITHSTANDING THE PROVISION IN
THE CONTRACT WITH THE SELLER, IT APPEARS THAT MR. EVERMAN PAID A
SUBSTANTIAL PORTION OF THE CLOSING COSTS. IN ADDITION, THERE IS NO
INDICATION IN THE RECORD BEFORE US THAT THE SELLER PROVIDED ANY LEGAL
SERVICES IN CONNECTION WITH THIS TRANSACTION.
THE NOW-SETTLED POLICY OF THIS OFFICE CONCERNING THE EXTENT TO WHICH
LEGAL FEES MAY BE REIMBURSED WAS ESTABLISHED IN OUR DECISION GEORGE W.
LAY, 56 COMP.GEN. 561 (1977). WE HELD IN LAY THAT FOR ANY SETTLEMENT
OCCURRING AFTER APRIL 27, 1977, NECESSARY AND REASONABLE LEGAL FEES AND
COSTS, EXCEPT FOR THE FEES AND COST OF LITIGATION, INCURRED BY REASON OF
THE PURCHASE OR SALE OF A RESIDENCE INCIDENT TO A PERMANENT CHANGE OF
STATION MAY BE REIMBURSED PROVIDED THAT THE COSTS ARE WITHIN THE
CUSTOMARY RANGE OF CHARGES FOR SUCH SERVICES WITHIN THE LOCALITY OF THE
RESIDENCE TRANSACTION. JUDY WYNEKOOP, B-205503, JUNE 2, 1982. THUS, WE
ALLOWED IN LAY AND IN SUBSEQUENT CASES CLAIMS FOR ATTORNEY FEES FOR
REPRESENTATIONAL AND ADVISORY SERVICES SUCH AS FOR REPRESENTATION AND
ATTENDANCE AT CLOSING.
WE FIND THAT THE ATTORNEY FEES INCURRED BY MR. EVERMAN AS NOTED ABOVE
WERE NECESSARY AND REASONABLE LEGAL FEES FOR REPRESENTATIONAL AND
ADVISORY SERVICES WITHIN THE MEANING OF LAY. THE RECORD SHOWS THAT THE
SERVICES WERE FOR REVIEW OF THE PURCHASE CONTRACT, CONTACTS WITH
REPRESENTATIVES OF THE SELLER, TITLE OPINION ANALYSIS AND REPRESENTATION
UP TO AND AT THE CLOSING. IN LAY, AND IN NUMEROUS OTHER CASES WE
ALLOWED REIMBURSEMENT FOR THESE EXPENSES. SEE, FOR EXAMPLE, CONSTANCE
A. HACKATHORN, B-205579, JUNE 21, 1982.
ACCORDINGLY, MR. EVERMAN'S CLAIM FOR THE $520 IN ATTORNEY FEES MAY BE
PAID IF IT IS DETERMINED THAT SUCH CHARGES ARE CUSTOMARILY PAID BY THE
PURCHASER OF A RESIDENCE IN THE LOCALITY INVOLVED AND IF IT IS
DETERMINED THAT THE CHARGES WERE WITHIN THE CUSTOMARY RANGE OF CHARGES
FOR SUCH SERVICES IN THAT LOCALITY.
B-210293, JUN 13, 1983
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
THE HONORABLE NORMAN Y. MINETA
CHAIRMAN, SUBCOMMITTEE ON AVIATION
COMMITTEE ON PUBLIC WORKS AND TRANSPORTATION,
HOUSE OF REPRESENTATIVES:
WE REFER TO YOUR LETTER OF MARCH 9, 1983, EXPRESSING INTEREST IN OUR
RESPONSE TO AN INQUIRY FROM MR. EDWARD J. DRISCOLL, PRESIDENT OF THE
NATIONAL AIR CARRIER ASSOCIATION, ALLEGING THAT THE AGENCY FOR
INTERNATIONAL DEVELOPMENT (AID) MAY HAVE VIOLATED 49 U.S.C. SEC. 1517
(1976), AS AMENDED, THE FLY AMERICA ACT, BY USING A FOREIGN FLAG CARRIER
TO SHIP SEWER-CLEANING UNITS FROM CLEVELAND TO TUNISIA. MR. DRISCOLL
CONTENDED THAT THREE UNITED STATES (U. S.) AIR CARRIERS COULD HAVE
TRANSPORTED THIS EQUIPMENT, BUT EITHER WERE NOT ADVISED OF THE SHIPMENT
BY AID, OR WERE NOT PERMITTED TO DEMONSTRATE TO AID THAT THEY HAD THE
CAPACITY TO TRANSPORT THE EQUIPMENT.
AID ADVISED THAT IT SOLICITED AMERICAN AIR CARRIERS, BUT IT
DETERMINED THAT TWO OF THE AMERICAN CARRIERS OFFERED INADEQUATE AIRCRAFT
TO ACCOMMODATE THE CARGO AND THE THIRD AIRLINE COULD NOT PROVIDE AN
AIRCRAFT WITHIN THE TIME REQUIREMENTS. AID FURTHER ADVISED THAT THE
CIVIL AERONAUTICS BOARD (CAB) APPROVED AN AUTHORIZATION FOR THE FOREIGN
AIR CARRIER TO TRANSPORT THE SHIPMENT, ALTHOUGH RECOGNIZING THAT THERE
WAS SOME DISPUTE WHETHER OR NOT U. S. CARRIERS HAD BEEN CONTACTED BY AID
OR COULD SUPPLY THE NEEDED CARGO CAPACITY. CAB STATED THAT THE SEVERITY
OF THE EMERGENCY IN TUNISIA AND THE CONSEQUENT CRITICAL NEED FOR PROMPT
TRANSPORT OF THE RELIEF MATERIAL DID NOT PROVIDE SUFFICIENT TIME TO
RESOLVE THESE DISPUTES SATISFACTORILY. AID ALSO CONTENDED THAT SINCE
SECTION 491(B) OF THE FOREIGN ASSISTANCE ACT, 22 U.S.C. SEC. 2292(B)
(1976), STATES THAT DISASTER ASSISTANCE MAY BE PROVIDED "NOTWITHSTANDING
ANY OTHER PROVISION OF THIS OR ANY OTHER ACT," THIS LAW EXEMPTS THE
TRANSPORTATION OF DISASTER RELIEF FROM THE FLY AMERICA ACT.
IN OUR INFORMAL OPINION TO MR. DRISCOLL, WE POINTED OUT THAT THIS
OFFICE HAS HELD THAT A DETERMINATION THAT A U. S. AIR CARRIER NEITHER
CAN SERVE AN AGENCY'S TRANSPORTATION NEEDS NOR ACCOMPLISH ITS MISSION IS
TO BE MADE BY THE AGENCY AND WILL NOT BE QUESTIONED BY OUR OFFICE UNLESS
IT IS ARBITRARY AND CAPRICIOUS. SEE EMPLOYEE OF OFFICE OF DEPENDENTS
SCHOOLS - MEDICAL NECESSITY FOR USE OF FOREIGN AIR CARRIER, B-202413,
NOVEMBER 16, 1981. IN OUR DECISION, JOINT CHIEFS OF STAFF, 57 COMP.GEN.
519, 522 (1978), WE ALSO RECOGNIZED THAT FOREIGN AIR CARRIER SERVICE MAY
BE NECESSARY TO ACCOMPLISH THE AGENCY'S MISSION IF ITS USE IS REQUIRED
TO AVOID AN UNREASONABLE RISK TO THE TRAVELER'S SAFETY. IT WAS OUR VIEW
THAT THESE DECISIONS WERE APPLICABLE TO THIS CASE CONCERNING THE
SHIPMENT OF DISASTER RELIEF CARGO. IN VIEW OF THE FINDINGS BY AID AND
CAB, WE DID NOT FIND THAT THE DECISION TO USE A FOREIGN FLAG CARRIER WAS
ARBITRARY AND CAPRICIOUS.
IN RESPONSE TO YOUR INQUIRY CONCERNING AID'S POSITION THAT THE
FOREIGN ASSISTANCE ACT PROVISION PROVIDES AN EXCEPTION TO APPLICATION OF
THE FLY AMERICA ACT, WE OBSERVE THE FOLLOWING. THE FOREIGN ASSISTANCE
ACT AUTHORIZES THE PRESIDENT TO FURNISH INTERNATIONAL DISASTER RELIEF
AND REHABILITATION, "NOTWITHSTANDING ANY OTHER PROVISION OF THIS CHAPTER
OR ANY OTHER ACT." AID STATES THAT THE CONGRESS INTENDED THE AUTHORITY
TO FURNISH DISASTER ASSISTANCE TO BE QUITE BROAD. IT REFERS TO THE
STATEMENT OF CONGRESSIONAL POLICY UNDER 22 U.S.C. SEC. 2292(A), IN WHICH
THE CONGRESS RECOGNIZED THE NEED FOR PROMPT U. S. DISASTER ASSISTANCE AS
AN EXPRESSION OF U. S. HUMANITARIAN CONCERNS. AID ALSO CITES THE
FOLLOWING STATEMENT FROM THE SENATE REPORT ON SECTION 491(B) (22 U.S.C.
SEC. 2292(B)), ACCOMPANYING THE BILL, THAT:
"'THE BILL REFLECTS THE COMMITTEE'S BELIEF
THAT, INSOFAR AS POSSIBLE, ECONOMIC AND
DISASTER ASSISTANCE SHOULD BE INSULATED FROM
TRADITIONAL POLITICAL CONSIDERATIONS AND THE
VICISSITUDE OF THE DAY-TO-DAY CONDUCT OF
FOREIGN POLICY.'
"S.REP. NO. 406, 94TH CONG., 1ST SESS. 10,
REPRINTED IN 1975 U. S. CONG. AND AD, NEWS
1651, 1659."
AID ALSO STATES THAT IT "WILL CONTINUE TO MAKE EVERY EFFORT TO MAKE
USE OF U. S.-FLAG AIR CARRIERS WHENEVER POSSIBLE," NOTWITHSTANDING THE
PROVISIONS OF THE FOREIGN ASSISTANCE ACT AND, IN THE CASE RAISED BY MR.
DRISCOLL IN HIS LETTER, AN EFFORT WAS MADE TO FIND A DOMESTIC CARRIER
WHICH MET THE AGENCY'S NEEDS.
AID'S EXEMPTION FROM THE FLY AMERICA ACT WOULD CLEARLY APPLY WHERE
ADHERENCE TO ITS REQUIREMENTS WOULD INTERFERE WITH THE FURNISHING OF
DISASTER RELIEF. CONGRESS WANTED DISASTER ASSISTANCE TO BE FURNISHED,
"NOTWITHSTANDING *** ANY OTHER ACT." ON THE OTHER HAND, WHERE RELIEF CAN
BE FURNISHED BY DOMESTIC CARRIERS WITHOUT JEOPARDIZING THE DISASTER
RELIEF PROGRAM, WE DO NOT THINK CONGRESS INTENDED TO PERMIT AID TO
EXERCISE THE EXEMPTION AUTHORITY. THUS, WE AGREE WITH AID THAT WHENEVER
RELIEF CAN BE FURNISHED AS NEEDED USING A DOMESTIC CARRIER, THE DOMESTIC
CARRIER SHOULD BE USED.
B-210290.2, APR 26, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT RECONSIDER A DECISION WHERE THE SAME MATERIAL ISSUES ARE
PENDING BEFORE THE CLAIMS COURT WITHOUT AN EXPRESSION OF INTEREST FROM
THE COURT.
SIX CONSTRUCT INTERNATIONL, INC./THE HERMAN BENNETT COMPANY,
A JOINT VENTURE; MWK INTERNATIONAL, LTD., INC. - RECONSIDERATION:
SIX CONSTRUCT INTERNATIONAL, INC./THE HERMAN BENNETT COMPANY, A JOINT
VENTURE, AND MWK INTERNATIONAL, LTD., INC. REQUEST RECONSIDERATION OF
OUR DECISION DEPARTMENT OF THE NAVY REQUEST FOR ADVANCE DECISION,
B-210290, MARCH 14, 1983, 83-1 CPD . THAT DECISION WAS CONSIDERED BY
THE UNITED STATES CLAIMS COURT IN CONNECTION WITH CIVIL ACTION NOS.
42-83C AND 145-83C. THE LITIGATION CONCERNS THE SAME MATERIAL ISSUES.
BY ORDER DATED MARCH 30, 1983, THE COURT DISSOLVED THE TEMPORARY
RESTRAINING ORDER IT ORIGINALLY GRANTED PENDING A HEARING ON SIX
CONSTRUCT'S MOTION FOR A PRELIMINARY INJUNCTION; THE COURT ALSO DENIED
THE PRELIMINARY INJUNCTION. A TRIAL ON THE MERITS IS PENDING. ANY
ACTION THE COURT NOW TAKES ON THE MERITS WILL CONSTITUTE A FINAL
ADJUDICATION AND WILL TAKE PRECEDENCE OVER A DECISION BY THIS OFFICE.
SEE SEAFARERS, ET AL. - RECONSIDERATION, B-194574.6, JULY 23, 1979, 79-2
CPD 48. THE COURT HAS NOT EXPRESSED ANY FURTHER INTEREST IN A DECISION
BY OUR OFFICE ON THE REQUEST FOR RECONSIDERATION AND THUS WE WILL NOT
RECONSIDER OUR ORIGINAL DECISION. TRAVENCA DEVELOPMENT CORPORATION,
B-203306.3, SEPTEMBER 21, 1981, 81-2 CPD 231.
THE REQUESTS FOR RECONSIDERATION ARE DISMISSED.
B-210290, MAR 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
WHERE IFB QUALIFICATION PROVISION RESTRICTED BIDDING TO U. S.
CONTRACTORS WHICH HAVE PAID CORPORATE TAXES "FOR A MINIMUM OF ONE YEAR,"
RECENTLY ESTABLISHED CORPORATION, IN EXISTENCE FOR LESS THAN 1 YEAR,
DOES NOT QUALIFY UNDER THE PROVISION.
DEPARTMENT OF THE NAVY REQUEST ADVANCE DECISION:
THE DEPARTMENT OF THE NAVY, NAVAL FACILITIES ENGINEERING COMMAND,
REQUESTS OUR DECISION AS TO WHETHER A JOINT VENTURE CONSISTING OF SIX
CONSTRUCT INTERNATIONAL, INC. OF TEXAS (SCT) AND THE HERMAN BENNETT
COMPANY, THE LOW BIDDER UNDER INVITATION FOR BIDS (IFB) NO.
N62470-81-B-1279, QUALIFIES AS A UNITED STATES (U. S.) CONTRACTOR UNDER
THE TERMS OF THE SOLICITATION. WE CONCLUDE THAT THE JOINT VENTURE DOES
NOT QUALIFY AS A U. S. CONTRACTOR.
THE IFB REQUESTED BIDS FOR A FIXED-PRICE CONSTRUCTION CONTRACT FOR
FACILITIES EXPANSION AT BERBERA, SOMALIA. THE FOLLOWING PROVISION WAS
CONTAINED IN THE IFB:
"2.7 BIDDING RESTRICTIONS: BIDDING ON THIS
CONTRACT IS RESTRICTED TO UNITED STATES CONTRACTORS
ONLY. TO QUALIFY AS A UNITED STATES CONTRACTOR,
THE BIDDER MUST COMPLY WITH THE FOLLOWING:
"(A) THE PRINCIPAL PLACE OF BUSINESS AND
CORPORATE HEADQUARTERS SHALL BE IN THE UNITED
STATES.
"(B) CORPORATE TAXES SHALL HAVE BEEN PAID IN
THE UNITED STATES FOR A MINIMUM OF ONE YEAR.
"(C) A MAJORITY OF THE CORPORATE OFFICERS
SHALL BE UNITED STATES CITIZENS.
"(D) KEY MANAGEMENT AND SUPERVISORY PERSONNEL
SHALL BE UNITED STATES CITIZENS."
THE NAVY EXPLAINS THAT THIS PROVISION IS PROMPTED BY A DEPARTMENT OF
DEFENSE POLICY TO PREFER U. S. FIRMS FOR CONSTRUCTION PROJECTS IN THE
INDIAN OCEAN/PERSIAN GULF REGION. IN CARRYING OUT THIS POLICY, DOD
CAUTIONED THE CONTRACTING AGENCY TO BE ALERT TO THE POSSIBILITY OF FIRMS
WHICH MIGHT BE FORMED TO EXPLOIT THE POLICY.
ON NOVEMBER 10, 1982, THE NAVY OPENED BIDS, AND SCT/BENNETT WAS LOW
AT $34,624,048. THE NEXT LOW BID OF $34,729,051, WAS SUBMITTED BY MWK
INTERNATIONAL, LTD., INC. THE NAVY ASKED THE LOW BIDDER TO SUPPLY
EVIDENCE THAT IT QUALIFIED AS A U. S. CONTRACTOR. PRIOR TO RECEIVING A
RESPONSE, MWK PROTESTED TO THE NAVY THAT THE JOINT VENTURE DID NOT
QUALIFY AS A U. S. CONTRACTOR BECAUSE SCT DID NOT SO QUALIFY. SCT
THEREAFTER SUBMITTED DOCUMENTS TO THE NAVY TO SUPPORT ITS
QUALIFICATIONS. THE NAVY THEN REQUESTED OUR DECISION ON WHETHER SCT
QUALIFIES AS A U. S. CONTRACTOR UNDER THE FOUR ELEMENTS LISTED IN THE
IFB.
SUBSEQUENTLY, MWK FILED SUIT IN THE UNITED STATES CLAIMS COURT (MWK
INTERNATIONAL, LTD., INC. V. UNITED STATES, NO. 42-83C). THE COURT WAS
DULY ADVISED ABOUT THE PROCEEDINGS BEFORE OUR OFFICE. THE COURT ISSUED
A MEMORANDUM ORDER DENYING MWK'S APPLICATION FOR A TEMPORARY RESTRAINING
ORDER, WITHOUT PREJUDICE TO RENEW, BECAUSE THE NAVY AGREED TO NOTIFY MWK
AT LEAST 2 WORKING DAYS PRIOR TO ANY AWARD OF THE CONTRACT UNDER THIS
SOLICITATION. THE COURT HAS STAYED FURTHER ACTION PENDING OUR DECISION.
IN ADDITION TO THE NAVY'S SUBMISSION, WE HAVE ALSO RECEIVED
SUBMISSIONS FROM SCT AND MWK IN SUPPORT OF THEIR RESPECTIVE POSITIONS.
BRIEFLY, IN RESPONSE TO THE NAVY'S REQUEST FOR EVIDENCE OF ITS
QUALIFICATION AS A U. S. CONTRACTOR, SCT HAS SUBMITTED DOCUMENTATION
SHOWING THAT IT WAS INCORPORATED IN DELAWARE ON FEBRUARY 18, 1982, AND
WAS AUTHORIZED TO TRANSACT BUSINESS IN TEXAS ON APRIL 6, 1982. SCT
LISTS AS ITS PRINCIPAL PLACE OF BUSINESS AND CORPORATE HEADQUARTERS AN
ADDRESS IN HOUSTON, TEXAS. IT STATES THAT IT HAS TWO CORPORATE
OFFICERS, BOTH OF WHOM (MR. CHARLES MACMILLAN AND MR. BEN BARNES) ARE
UNITED STATES CITIZENS. IT ALSO HAS SUBMITTED A LIST OF SEVEN KEY
MANAGEMENT AND SUPERVISORY PERSONNEL, INCLUDING THE PROJECT MANAGER AND
GENERAL SUPERINTENDENT, TO BE USED ON THE CONTRACT IN THE EVENT OF AN
AWARD, AND STATES THAT ALL OF THEM ARE U. S. CITIZENS.
AS TO SCT'S TAX FILINGS, THE RECORD SHOWS THAT ON NOVEMBER 12, 1982,
IT FILED A FEDERAL CORPORATION INCOME TAX RETURN FOR THE PERIOD FROM
FEBRUARY 18, 1982 THROUGH OCTOBER 31, 1982. AS OF THE CLOSE OF ITS
FISCAL YEAR, THE RETURN SHOWS THAT SCT HAD NOT ENGAGED IN ANY COMMERCIAL
ENTERPRISE FOR PROFIT SO THAT SCT REPORTED NO TAXABLE INCOME AND PAID NO
INCOME TAX. THE RECORD ALSO SHOWS THAT SCT FILED QUARTERLY FEDERAL AND
STATE EMPLOYER TAXES SUCH AS SOCIAL SECURITY AND STATE COMPENSATION
TAXES, AND THAT IT PAID STATE INCORPORATION TAXES.
BASED ON THE ABOVE SUBMISSIONS, SCT ARGUES THAT IT QUALIFIES AS A U.
S. CONTRACTOR UNDER THE FOUR ELEMENTS LISTED IN THE IFB. WHILE IT HAS
NOT PAID CORPORATE TAXES FOR A FULL YEAR, SCT ARGUES THAT IT HAS PAID
ALL THE TAXES THAT HAVE BEEN DUE DURING THE PERIOD OF ITS EXISTENCE.
MWK ARGUES THAT SCT REALLY MEETS NONE OF THE FOUR ELEMENTS LISTED IN
THE IFB BECAUSE IT IS "SIMPLY A TOKEN ORGANIZATION" OWNED AND CONTROLLED
BY A MAJOR BELGIUM CONSTRUCTION CONTRACTOR OF THE SAME NAME, AND WAS
FORMED TO EXPLOIT THE DOD PREFERENCE POLICY FOR U. S. CONTRACTORS. IN
SUPPORT OF ITS POSITION, IT STATES THAT AT LEAST THREE OF THE SIX
DIRECTORS OF SCT ARE BELIEVED BY MWK NOT TO BE U. S. CITIZENS; THAT
THE BELGIUM CONTRACTOR IS BELIEVED BY MWK TO HAVE FINANCED SCT'S RECENT
ORGANIZATION AND OPERATION IN THE UNITED STATES; AND THAT DUN AND
BRADSTREET REPORTS AND EVEN A PUBLIC ADVERTISEMENT FROM THE BELGIUM FIRM
ITSELF INDICATE THAT SCT IS "THE DOMESTIC ALTER EGO OF A MAJOR
INTERNATIONAL CONSTRUCTION FIRM HEADQUARTERED IN BELGIUM." MWK ALSO
POINTS TO THE FACT THAT SCT HAS NOT BEEN IN EXISTENCE FOR A FULL YEAR
AND HAS PAID NO INCOME TAXES, AS SHOWING THAT IT DOES NOT QUALIFY AS A
U. S. CONTRACTOR.
INITIALLY WE NOTE THAT THE OTHER PARTY TO THE JOINT VENTURE, THE
HERMAN BENNETT COMPANY, DOES QUALIFY AS A U. S. CONTRACTOR. SINCE JOINT
VENTURES ARE USUALLY FORMED FOR A LIMITED PURPOSE AND DURATION, WE THINK
THAT THE QUALIFICATION REQUIREMENTS, SUCH AS THE 1-YEAR TAX PROVISION,
WERE OBVIOUSLY INTENDED BY THE NAVY TO APPLY TO THE PARTIES TO THE JOINT
VENTURE, NOT SIMPLY TO THE JOINT VENTURE ITSELF. THEREFORE, SCT'S
QUALIFICATIONS WERE PROPERLY PUT AT ISSUE BY THE NAVY IN DETERMINING
WHETHER THE JOINT VENTURE QUALIFIES FOR AWARD UNDER THE SOLICITATION.
WITH RESPECT TO SCT'S QUALIFICATIONS AS A U. S. CONTRACTOR, IT IS
CLEAR THAT THE BIDDER MEETS THREE OF THE FOUR IFB ELEMENTS. MWK DOES
NOT REALLY REFUTE SCT'S STATEMENTS AS TO THE LOCATION OF ITS PRINCIPAL
PLACE OF BUSINESS AND CORPORATE HEADQUARTERS, AND THE UNITED STATES
CITIZENSHIP OF ITS CORPORATE OFFICERS AND NAMED KEY PERSONNEL.
ESSENTIALLY MWK ARGUES THAT ONE SHOULD LOOK MORE CLOSELY AT SCT'S
OWNERSHIP AND CONTROL TO DETERMINE IF SCT REALLY MEETS THE LISTED
ELEMENTS. BUT AS THE NAVY NOTES, THE IFB QUALIFICATION PROVISION MAKES
NO STATEMENT AS TO OWNERSHIP OF STOCK OR CONTROL. WE MUST THEREFORE
CONCLUDE THAT SCT QUALIFIES AS A U. S. CONTRACTOR UNDER PARAGRAPHS 2.7(
A), (C) AND (D) OF THE IFB PROVISION, BASED ON THE EVIDENCE SUBMITTED.
THE REMAINING ELEMENT WHICH MUST BE MET IS PARAGRAPH 2.7(B). THAT
PARAGRAPH PROVIDES THAT THE BIDDER MUST HAVE PAID CORPORATE TAXES "IN
THE UNITED STATES FOR A MINIMUM OF ONE YEAR" IN ORDER TO QUALIFY AS A U.
S. CONTRACTOR. IT IS APPARENT TO US THAT A CORPORATION WHICH HAS ONLY
BEEN IN EXISTENCE FOR LESS THAN 1 YEAR CANNOT MEET THIS REQUIREMENT. IT
IS NOT SUFFICIENT, IN OUR OPINION, FOR A CORPORATION TO HAVE EXISTED AND
FUNCTIONED ONLY LONG ENOUGH TO HAVE FILED SOME QUARTERLY RETURNS AND A
TAX RETURN FOR A SHORT FISCAL YEAR. WE READ PARAGRAPH 2.7(B) AS
REQUIRING THAT THE BIDDER MUST HAVE BEEN A TAXPAYER IN THE UNITED STATES
FOR AT LEAST A FULL YEAR. THIS REQUIREMENT SERVES AS AN IMPORTANT
SAFEGUARD AGAINST FOREIGN CONTRACTORS SEEKING TO EXPLOIT THE PREFERENCE
POLICY.
WE HAVE CONSIDERED SCT'S ARGUMENT THAT PARAGRAPH 2.7(B) IS UNDULY
RESTRICTIVE OF COMPETITION. IN OTHER CIRCUMSTANCES, WE MIGHT WELL
AGREE; HOWEVER, WE HAVE NO REASON TO OBJECT TO ITS APPLICATION IN A
SITUATION LIKE THE ONE PRESENTED HERE, WHERE A COMPANY ESTABLISHED WITH
FOREIGN AFFILIATION HAS NOT UNDERTAKEN ANY CONSTRUCTION BUSINESS SINCE
ITS INCEPTION.
THEREFORE, EVEN THOUGH SCT LITERALLY MEETS THREE OF THE FOUR ELEMENTS
OF THE IFB QUALIFICATION PROVISION, WE FIND THAT IT DOES NOT QUALIFY AS
A U. S. CONTRACTOR UNDER THE IFB BECAUSE IT DOES NOT MEET ALL OF THE
LISTED ELEMENTS. ACCORDINGLY THE JOINT VENTURE IS NOT A QUALIFIED
BIDDER FOR THIS CONTRACT.
WE THINK, HOWEVER, THAT PARAGRAPH 2.7(B) SHOULD BE MORE PRECISELY
WORDED. THE REQUIREMENT IS INTENDED TO APPLY TO A FOREIGN CONTRACTOR
ATTEMPTING TO QUALIFY FOR THIS CONTRACT MERELY BY FORMING A UNITED
STATES CORPORATION TO SUBMIT A BID FOR THE CONTRACT. BUT A LITERAL
APPLICATION OF PARAGRAPH 2.7(B) COULD DISQUALIFY ALL RECENTLY-FORMED
DOMESTIC CORPORATIONS THAT HAVE NOT YET PAID CORPORATE TAXES FOR A FULL
YEAR. THE REQUIREMENT THAT "TAXES SHALL HAVE BEEN PAID" LITERALLY WOULD
ALSO DISQUALIFY ESTABLISHED UNITED STATES CONCERNS WHICH ACTUALLY EARNED
NO TAXABLE INCOME IN RECENT YEARS. THEREFORE, WE RECOMMEND THAT THE
PROVISION BE REVISED BEFORE IT IS USED AGAIN TO MORE CLEARLY REFLECT
PRECISELY WHAT IS INTENDED.
B-210289, FEB 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
ABSENT SHOWING OF FRAUD OR BAD FAITH, GAO WILL NOT CONSIDER PROTEST
THAT PROCUREMENT FOR THREE-HORSEPOWER ENGINES SHOULD HAVE BEEN
NEGOTIATED WITH PROTESTER UNDER SECTION 8(A) OF SMALL BUSINESS ACT,
BECAUSE DECISION TO AWARD CONTRACT UNDER SECTION 8(A) IS WITHIN THE
DISCRETION OF CONTRACTING OFFICIALS.
WELBILT ELECTRONIC DIE CORPORATION:
WELBILT ELECTRONIC DIE CORPORATION (WELBILT) PROTESTS THE DECISION OF
THE DEPARTMENT OF THE ARMY TO COMPETITIVELY PROCURE THREE-HORSEPOWER
ENGINES UNDER INVITATION FOR BIDS DAAJ09-83-R-A225.
WE DISMISS THE PROTEST.
WELBILT IS CURRENTLY PRODUCING SIX-HORSEPOWER ENGINES FOR THE ARMY
UNDER THE SMALL BUSINESS ADMINISTRATION (SBA) 8(A) PROGRAM. WELBILT
CONTENDS THAT THE ARMY LED WELBILT TO BELIEVE THAT ITS REQUIREMENTS FOR
THREE-HORSEPOWER AND ONE AND ONE-HALF HORSEPOWER ENGINES WOULD ALSO BE
RESERVED FOR WELBILT UNDER THE SEC. 8(A) PROGRAM.
SECTION 8(A) OF THE SMALL BUSINESS ACT, 15 U.S.C. SEC. 637(A) (SUPP.
III, 1979), AUTHORIZES THE SBA TO ENTER INTO CONTRACTS WITH ANY
GOVERNMENT AGENCY WITH PROCURING AUTHORITY AND TO THEN SUBCONTRACT
PERFORMANCE OF THE CONTRACTS TO SOCIALLY AND ECONOMICALLY DISADVANTAGED
SMALL BUSINESSES. THE STATUTE ALSO AUTHORIZES THE PROCURING AGENCY'S
CONTRACTING OFFICER TO AWARD CONTRACTS TO SBA "IN HIS DISCRETION." IN
LIGHT OF THIS BROAD DISCRETION GIVEN CONTRACTING OFFICERS, WE DO NOT
REVIEW AN AGENCY DECISION TO SET ASIDE OR NOT SET ASIDE CONTRACTS FOR
8(A) AWARD, UNLESS THERE IS A SHOWING OF FRAUD OR BAD FAITH ON THE PART
OF GOVERNMENT OFFICIALS. WAKON REDBIRD & ASSOCIATES, B-205995, FEBRUARY
8, 1982, 82-1 CPD 111. WELBILT DOES NOT ALLEGE THAT THE ARMY'S DECISION
TO COMPETITIVELY PROCURE THE THREE-HORSEPOWER ENGINES RESULTED FROM
FRAUD OR BAD FAITH.
PROTEST DISMISSED.
B-210285.2, AUG 15, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO DECISION IS AFFIRMED WHERE RECONSIDERATION
REQUEST MERELY REFLECTS PROTESTER'S
DISAGREEMENT WITH DECISION AND DOES NOT
PROVIDE EVIDENCE THAT THE DECISION WAS BASED
ON ANY ERRORS OF LAW OR FACT.
PACIFIC COAST UTILITIES SERVICE, INC. - RECONSIDERATION:
PACIFIC COAST UTILITIES SERVICE, INC. REQUESTS RECONSIDERATION OF OUR
DECISION, PACIFIC COAST UTILITIES SERVICE, INC., B-210285, JUNE 29,
1983, 83-2 CPD , DENYING ITS PROTEST OF THE NAVY'S AWARD OF A CONTRACT
TO ABLE BUILDING MAINTENANCE CO., UNDER INVITATION FOR BIDS (IFB) NO.
N62474-82-B-3726, FOR MAINTENANCE SERVICES AT THE NAVAL POST GRADUATE
SCHOOL, MONTEREY, CALIFORNIA. IN THAT DECISION, WE DENIED PACIFIC'S
PROTEST THAT ABLE'S BID WAS AMBIGUOUS AND THEREFORE NONRESPONSIVE
BECAUSE IT INCLUDED A SEPARATELY PRICED BID ITEM NOT PROVIDED FOR IN THE
SOLICITATION'S BID SCHEDULE.
WE AFFIRM OUR PRIOR DECISION.
PACIFIC ARGUES THAT ABLE'S ADDITION OF A BID ITEM PRICE FOR UTILITY
SERVICES ON A SCHEDULE WHICH REQUIRED ONLY A SINGLE LUMP-SUM PRICE FOR
VARIOUS MAINTENANCE SERVICES REQUIRED CREATED AN AMBIGUITY REGARDING
ABLE'S UNDERSTANDING OF THE IFB. IN OUR PRIOR DECISION, WE CONSIDERED
THIS ARGUMENT AND CONCLUDED THAT UNDER ANY REASONABLE INTERPRETATION OF
ABLE'S BID, THAT FIRM WAS OBLIGATED TO PERFORM ALL OF THE REQUIRED
SERVICES. THE ONLY QUESTION WHICH REMAINED WAS WHETHER THE $5,100 PRICE
SET OUT IN THE SCHEDULE WAS TO BE INCLUDED IN ABLE'S TOTAL PRICE OR
ADDED TO IT. SINCE ABLE WAS LOW IN ANY CASE, IT WAS AND STILL IS OUR
VIEW THAT THE PROTESTER WAS NOT PREJUDICED BY THE AGENCY'S ACTION IN
ASKING ABLE TO EXPLAIN ITS BID AFTER OPENING.
OUR BID PROTEST PROCEDURES REQUIRE THAT A REQUEST FOR RECONSIDERATION
SPECIFY ANY ERROR OF LAW MADE OR INFORMATION NOT PREVIOUSLY CONSIDERED
IN THE PROTEST. 4 C.F.R. SEC. 21.9(A) (1983). HERE, PACIFIC HAS MERELY
INDICATED THAT IT FINDS OUR TREATMENT OF THE ISSUES IT RAISED CURSORY
AND SIMPLISTIC. HOWEVER, PACIFIC HAS NOT PROVIDED ANY NEW ARGUMENTS OR
FACTS. MERE DISAGREEMENT WITH OUR PRIOR DECISION DOES NOT PROVIDE A
BASIS TO REVERSE THE DECISION. SPACE AGE ENGINEERING, INC. -
RECONSIDERATION, B-205594.3, SEPTEMBER 24, 1982, 82-2 CPD 269.
ACCORDINGLY, WE AFFIRM OUR PRIOR DECISION. TOM SHAW, INC. -
RECONSIDERATION, B-209018.2, MARCH 22, 1983, 83-1 CPD 285.
B-210283, SEP 20, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
AGENCY PROPERLY CANCELED AN IFB AFTER BID
OPENING WHERE AS A RESULT OF POST-OPENING
EVENTS THE NEED FOR THE ITEMS BECAME
URGENT, AND THE AGENCY'S OWN IN-HOUSE
FACILITY COULD PRODUCE AND DELIVER THE
ITEMS FASTER THAN COULD BE REQUIRED
UNDER THE IFB.
POWERTRONIC SYSTEMS, INC.:
POWERTRONIC SYSTEMS, INC. PROTESTS THE CANCELLATION AFTER BID OPENING
OF INVITATION FOR BIDS (IFB) NO. N00421-82-B-0211, ISSUED BY THE
DEPARTMENT OF THE NAVY FOR THE PRODUCTION AND DELIVERY OF 12 CONVERTER
INTERFACE UNITS, WITH OPTIONS FOR AS MANY AS 80 MORE UNITS DURING THE
SUBSEQUENT 2-YEAR PERIOD. A CONVERTER INTERFACE UNIT (CIU) CONVERTS
ANALOG RADIO SIGNALS INTO DIGITAL FORM AND TRANSMITS THEM TO SHIPBOARD
COMPUTERS. THE NAVY CANCELED THE IFB BECAUSE IT WAS AMBIGUOUS, DID NOT
CLEARLY REFLECT THE AGENCY'S NEEDS, AND CONTAINED A DELIVERY SCHEDULE
THAT HAD BECOME OBSOLETE BECAUSE THE NEED FOR CIUS HAD BECOME URGENT AND
AN ACCELERATED SCHEDULE COULD BE MET ONLY IF THE CIUS WERE PRODUCED IN
THE IN-HOUSE FACILITY AT THE NAVAL AVIONICS CENTER IN INDIANAPOLIS.
POWERTRONIC CONTENDS THAT THE MAIN REASON FOR THE CANCELLATION WAS TO
AVOID AN AWARD TO IT, AND THAT THE AMBIGUITY AND URGENCY REASONS WERE
CONTRIVED BY THE NAVY TO ACCOMPLISH THIS PURPOSE.
WE DENY THE PROTEST.
WHEN THE BIDS WERE OPENED ON SEPTEMBER 21, 1982, THE LOW BID WAS
DETERMINED TO BE NONRESPONSIVE, WHICH LEFT THE BID OF POWERTRONIC AS THE
LOWEST RESPONSIVE BID. THE NAVY STATES THAT A PRE-AWARD SURVEY OF THE
POWERTRONIC FACILITY FIRST ALERTED THE CONTRACTING OFFICER TO THE
POSSIBILITY THAT THE IFB MIGHT BE AMBIGUOUS AS TO WHETHER THE CONTRACTOR
WAS EXPECTED TO BUILD THE CIUS STRICTLY IN ACCORDANCE WITH THE IFB'S
DRAWING PACKAGE, OR WHETHER THE DRAWING PACKAGE HAD BEEN FURNISHED FOR
INFORMATION PURPOSES ONLY. IN ADDITION, THE USING AGENCY INSISTED THAT
THE CONTRACTOR HAVE CERTAIN EXPERTISE AND EXPERIENCE WITH THE EQUIPMENT
WITH WHICH THE CIUS INTERFACE SO THAT THE CONTRACTOR COULD BE CALLED
UPON TO SUPPORT THE CIUS IN THE FLEET. THE PROCUREMENT OFFICE, HOWEVER,
HAD DOUBTS AS TO WHETHER THESE QUALIFICATIONS WERE REQUIRED BY THE IFB.
THE REVIEW AND DISCUSSIONS OF THESE MATTERS CONTINUED UNTIL APRIL 14,
1983 WHEN THE SOLICITATION WAS CANCELED PRIMARILY BECAUSE THE NEED FOR A
PORTION OF THE CIUS HAD BECOME URGENT DUE TO A DECISION BY THE CHIEF OF
NAVAL OPERATIONS PROHIBITING THE EXPECTED DIVERSION TO THE FLEET OF CIUS
THAT HAD BEEN DESIGNATED FOR TRAINING. THE URGENT PORTION OF THE
REQUIREMENT (25 UNITS) WAS THEN GIVEN TO THE NAVAL AVIONICS CENTER TO
PRODUCE IN ITS FACILITIES BECAUSE THE NAVY BELIEVED THAT ONLY IN THAT
MANNER COULD THE CIUS BE OBTAINED AS PROMPTLY AS NEEDED. IN ADDITION,
THE NAVAL AVIONICS CENTER WAS GIVEN THE RESPONSIBILITY TO VALIDATE THE
DRAWINGS. POWERTRONIC WAS THEN NOTIFIED OF THE CANCELLATION, AND WAS
INFORMED THAT THE NAVY ANTICIPATED A COMPETITIVE PROCUREMENT DURING THE
NEXT FISCAL YEAR FOR THE REMAINING UNITS AND THAT POWERTRONIC WOULD BE
SOLICITED.
THE PROCUREMENT REGULATIONS PERMIT CANCELLATION AFTER BID OPENING
WHEN CANCELLATION IS IN THE BEST INTERESTS OF THE GOVERNMENT. DEFENSE
ACQUISITION REGULATION SEC. 2-404.1 (B)(VIII) (1976 ED.). BECAUSE OF
THE POTENTIAL ADVERSE IMPACT ON THE COMPETITIVE BIDDING SYSTEM OF
CANCELING AN IFB AFTER BID PRICES HAVE BEEN EXPOSED, HOWEVER, THE
JUSTIFICATION ADVANCED BY A CONTRACTING OFFICER FOR EXERCISING HIS
DISCRETIONARY AUTHORITY TO CANCEL MUST BE COGENT AND COMPELLING.
NONPUBLIC EDUCATIONAL SERVICES, INC., B-207751, MARCH 8, 1983, 83-1 CPD
232. THE DETERMINATION AS TO WHETHER SUCH A JUSTIFICATION EXISTS IS AN
ADMINISTRATIVE ONE THAT IS NOT SUBJECT TO LEGAL OBJECTION UNLESS THE
PROTESTER CAN DEMONSTRATE THAT THE DECISION WAS ARBITRARY, CAPRICIOUS,
OR NOT SUPPORTED BY SUBSTANTIAL EVIDENCE. MCGREGOR PRINTING
CORPORATION, B-207084, B-207377, SEPTEMBER 20, 1982, 82-2 CPD 240.
AWARD OF A CONTRACT TO POWERTRONIC WOULD HAVE OBLIGATED THE FIRM TO
DO ONLY THAT ON WHICH THE BID WAS BASED: TO DELIVER TWO FIRST ARTICLES
IN JULY OF 1983, AND THE LAST OF THE 12 UNITS IN SEPTEMBER 1984. THAT
SCHEDULE WAS BASED ON THE NAVY'S EXPECTATION THAT CIUS TO BE USED IN
TRAINING COULD BE DIVERTED FOR THE FLEET REQUIREMENT. THE FACT IS,
HOWEVER, THAT AFTER BID OPENING THE PROCUREMENT OFFICE FOUND THAT THE
TRAINING CIUS COULD NOT BE USED, SO THAT THE 12 UNITS IN ISSUE (AND 13
MORE) WERE NEEDED BEGINNING IN FEBRUARY OF 1983, WITH DELIVERY COMPLETED
BY JANUARY OF 1984. WHILE POWERTRONIC SUGGESTS THAT THE NAVAL AVIONICS
CENTER MAY WELL HAVE PROBLEMS DELIVERING THE BULK OF THE CIUS ON TIME -
THE MATTER WAS NOT EVEN REFERRED TO THE CENTER UNTIL AFTER MID-APRIL OF
1983 - POWERTRONIC DOES NOT ARGUE THAT IT COULD MEET THE NAVY'S NEED IN
A TIMEFRAME AT ALL COMPARABLE TO THE ONE UNDER WHICH THE NAVAL AVIONICS
CENTER IS WORKING. WE BELIEVE THAT WHEN THE GOVERNMENT CAN BUILD AN
URGENTLY NEEDED ITEM FASTER IN-HOUSE THAN BY CONTRACTING, CANCELLATION
AFTER BID OPENING OF AN IFB THAT WOULD NOT MEET THE URGENT NEED IS IN
THE BEST INTEREST OF THE GOVERNMENT. SEE BUSH-HERRICK, INC., B-209683,
JUNE 20, 1983, 83-1 CPD 669.
BECAUSE WE BELIEVE THE IFB PROPERLY WAS CANCELED FOR THE REASONS
DISCUSSED ABOVE, WE NEED NOT DETERMINE WHETHER IT ALSO COULD HAVE BEEN
CANCELED BASED ON AMBIGUOUS SPECIFICATIONS.
THE PROTEST IS DENIED.
B-210276, SEP 2, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PRICING INFORMATION WHICH WAS REQUESTED IN
SOLICITATION FOR ACCOUNTING PURPOSES ONLY AND NOT AS A BASIS FOR
AWARD IS NOT MATERIAL AND THEREFORE FAILURE TO INCLUDE SUCH
INFORMATION DOES NOT RENDER BID NONRESPONSIVE.
2. REGULATION ALLOWING CORRECTION OF MISTAKE
IN CONTRACTOR'S BID WHICH IS NOT DISCOVERED UNTIL AFTER BID
OPENING APPLIES ONLY WHERE CONTRACTOR INADVERTENTLY INCLUDES IN
ITS BID SOMETHING OTHER THAN WHAT IT INTENDED.
3. WHERE ONLY EVIDENCE AS TO WHETHER CONTRACTING
OFFICIAL ADVISED THE PROTESTER TO INCLUDE CERTAIN ELEMENTS IN ITS
BID IS CONFLICTING STATEMENTS BY PROTESTER AND CONTRACTING
OFFICIALS, AND EVEN AT BEST PROTESTER RELIES UPON AN "IMPLICATION"
IN A CONVERSATION, THE PROTESTER HAS NOT MET THE BURDEN TO PROVE
ITS CASE.
4. OUTCOME OF BIDDING WAS NOT AFFECTED BY
SPECIFICATION DEVIATIONS TAKEN BY AWARDEE SINCE THEY DID NOT GIVE
THE AWARDEE A PRICE ADVANTAGE EXCEEDING THE DIFFERENCE BETWEEN ITS
BID AND THE NEXT LOW BID OF THE PROTESTER.
LUSARDI CONSTRUCTION COMPANY:
LUSARDI CONSTRUCTION COMPANY PROTESTS THE AWARD OF A CONTRACT BY THE
GENERAL SERVICES ADMINISTRATION (GSA) TO HARPER DEVELOPMENT & ASSOCIATES
FOR THE DESIGN AND CONSTRUCTION OF THE OTAY MESA BORDER STATION, SAN
DIEGO, CALIFORNIA (PROJECT NO. NCA00900-A). LUSARDI CONTENDS THAT
HARPER'S BID SHOULD HAVE BEEN REJECTED AS NONRESPONSIVE BECAUSE (1) IT
DID NOT INCLUDE ANY PRICE FOR PAYMENT OF FEES FOR WATER SERVICE FOR THE
PROJECT AND (2) IT DID NOT COMPLY WITH ALL OF THE SPECIFICATIONS IN THE
SOLICITATION. WE DENY THE PROTEST.
SIX MONTHS AFTER IT FILED ITS PROTEST WITH OUR OFFICE, LUSARDI FILED
SUIT AGAINST THE ADMINISTRATOR OF GSA IN THE UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF CALIFORNIA, SEEKING INJUNCTIVE
RELIEF. LUSARDI CONSTRUCTION CO. V. GERALD P. CARMEN, ET AL., CIVIL NO.
83-1033-GT(H). THE COURT DENIED INJUNCTIVE RELIEF AND HAS REQUESTED AN
ADVISORY OPINION FROM OUR OFFICE. THIS DECISION IS IN RESPONSE TO THAT
REQUEST.
BACKGROUND
ON AUGUST 18, 1982, GSA ISSUED A REQUEST FOR TECHNICAL PROPOSALS
(RFTP), WHICH WAS STEP ONE OF A TWO-STEP FORMALLY ADVERTISED PROCUREMENT
FOR THE DESIGN AND CONSTRUCTION OF A BORDER STATION, CONSISTING OF A
TRUCK INSPECTION FACILITY AND PRIMARY AND SECONDARY VEHICLE INSPECTION
FACILITIES. NINE FIRMS SUBMITTED ACCEPTABLE TECHNICAL PROPOSALS AND ON
OCTOBER 13 THE STEP-TWO INVITATION FOR BIDS WAS ISSUED TO THOSE NINE
FIRMS. EIGHT BIDS WERE RECEIVED ON THE BID OPENING DATE OF NOVEMBER 3.
AFTER BID OPENING, GSA CONCLUDED THAT THE RFTP CONTAINED MATERIAL
DEFECTS AND AMBIGUITIES AND IT SUBSEQUENTLY CANCELED STEP TWO AND
REOPENED STEP ONE TO AMEND THE RFTP AND TO ALLOW FIRMS TO SUBMIT REVISED
TECHNICAL PROPOSALS. THE STEP-TWO IFB WAS REISSUED ON DECEMBER 8 AND
SIX BIDS WERE OPENED ON DECEMBER 17. THE LOW BID WAS SUBMITTED BY
HARPER IN THE AMOUNT OF $7,749,000, WHILE THE SECOND LOW BID WAS
SUBMITTED BY LUSARDI IN THE AMOUNT OF $7,882,000-- A DIFFERENCE OF
$133,000. GSA AWARDED THE CONTRACT TO HARPER ON JANUARY 21, 1983,
NOTWITHSTANDING THE FILING OF THIS PROTEST.
FEES
THE SOLICITATION INSTRUCTED BIDDERS TO SUBMIT ONE LUMP SUM BASE BID
TO COVER THE ENTIRE CONTRACT, AS WELL AS TO LIST ON THE BID FORM THE
LUMP SUM FOR EACH COMPONENT OF THE BASE BID. THE BID FORM PROVIDED:
"SEPARATED PRICE FOR BASE BID: THE AMOUNT
INCLUDED IN THE LUMP SUM BID FOR THE
FOLLOWING WORK SHALL BE STATED ON THE BID
FORM. THIS INFORMATION IS REQUIRED FOR
ACCOUNTING PURPOSES ONLY AND WILL NOT FORM
A PART OF THE BASIS OF AWARD. (SEE SECTION
01000, PARA. 4.)
A. LUMP SUM FOR ALL DESIGN PHASE WORK $
B. LUMP SUM FOR THE PLANNING SCHEDULE $
C. LUMP SUM FOR SOILS TEST. & REPORT $
D. LUMP SUM FOR NEW CONSTR. PHASE WORK $
E. LUMP SUM FOR FEES $ "
LUSARDI'S FIRST BASIS FOR PROTEST CONCERNS THE FEES TO BE PAID FOR
THE PROVISION OF WATER SERVICE TO THE BORDER STATION. IT CONTENDS THAT
THE SOLICITATION IMPOSED ON THE CONTRACTOR AN OBLIGATION TO PAY CERTAIN
OF THOSE FEES AND BECAUSE HARPER EXCLUDED THEM FROM ITS BID, THAT BID
WAS NONRESPONSIVE. ALTERNATIVELY, LUSARDI ARGUES THAT IF ITS INCLUSION
OF THOSE FEES IN ITS BID RESULTED FROM A MISTAKEN READING OF THE
SOLICITATION, THEN IT SHOULD BE PERMITTED TO CORRECT ITS BID DOWNWARD.
FOR THE REASONS STATED BELOW, THIS ASPECT OF THE PROTEST IS DENIED.
THE RFTP INFORMED BIDDERS THAT THERE ARE NO UTILITIES EXISTING ON THE
SITE AND THAT "THE CONTRACTOR WILL BE REQUIRED TO PROVIDE WATER AS
SPECIFIED ***, AND SHOWN ON DRAWINGS. HOOK-UP FEE SHALL NOT BE INCLUDED
IN THE BASE BID. COORDINATE WITH THE OTAY MUNICIPAL WATER DISTRICT."
NOTE 6 OF DRAWING C6 IN THE RFTP FURTHER PROVIDED THAT:
"CONTRACTOR SHALL ARRANGE FOR OTAY MUNICIPAL
WATER DISTRICT (OMWD) TO INSTALL 16" X
8" TAPPING SLEEVE AND 8" GATE VALVE.
CONTRACTOR SHALL INSTALL 8" CAP FOR TESTING
BY OMWD. AFTER SUCCESSFUL TEST REMOVE CAP
AND CONNECT TO TAPPING GATE VALVE. CONTRACTOR
SHALL FURNISH, ARRANGE FOR AND PAY
FOR ALL WATER SYSTEM WORK SHOWN EXCEPT THE
WATER CONNECTION FEE AND WATER MAIN TAPPING
COST, WHICH WILL BE PAID FOR BY THE GOVERNMENT."
THE RECORD SHOWS THAT ON APRIL 26, SEVERAL MONTHS BEFORE GSA ISSUED
THE RFTP, THE OTAY MUNICIPAL WATER DISTRICT PROVIDED GSA WITH AN
ESTIMATE OF COSTS AND CHARGES FOR PROVIDING WATER SERVICE FOR THE
DEVELOPMENT. THESE FEES, WHICH TOTALED APPROXIMATELY $128,000, INCLUDED
$25,000 FOR PROVIDING WATER METERS IN CONCRETE VAULTS.
LUSARDI STATES THAT ON THE DAY PRIOR TO THE FIRST BID OPENING, ITS
REPRESENTATIVE MET WITH AN EMPLOYEE OF THE WATER DISTRICT TO DISCUSS ALL
FEES ASSOCIATED WITH PROVIDING WATER TO THE PROJECT, AND WAS PROVIDED
INFORMATION ESSENTIALLY IDENTICAL TO THAT GIVEN GSA. THE NEXT DAY,
LUSARDI STATES, PRIOR TO BID OPENING IT CALLED GSA'S PROJECT MANAGER AND
ASKED WHETHER IT SHOULD EXCLUDE FROM ITS BID ALL THE FEES CLAIMED
PAYABLE BY THE WATER DISTRICT OR ONLY THE $25,000 FEE FOR METERS SET IN
CONCRETE VAULTS (WHICH LUSARDI REFERS TO AS A "HOOKUP FEE"). LUSARDI
STATES:
"*** THE PROJECT MANAGER DID NOT INFORM
ME WHETHER OR NOT IN HIS OPINION THE
MENTIONED FEES OTHER THAN THE FIRST FEE FOR
HOOKUP OF $25,000 *** SHOULD BE INCLUDED
IN THE BASE BID BUT IMPLIED *** THAT
SINCE THOSE FEES HAD NOT BEEN EXPRESSLY
EXCLUDED FROM THE SCOPE OF THE OBLIGATIONS
TO BE INCLUDED IN THE BASE BID, THEY SHOULD
BE INCLUDED IN OUR BID. ACCORDINGLY, WE
DID SO.
"*** JUST PRIOR TO THE SECOND BID DATE
LUSARDI AGAIN COMMUNICATED WITH THE WATER
DISTRICT TO DETERMINE WHETHER THE FEES FOR
WATER SERVICE TO THE PROJECT WERE STILL
REQUIRED AND WHETHER THERE HAD BEEN ANY
CHANGE IN THE AMOUNTS CLAIMED PAYABLE. THE
OTAY MUNICIPAL WATER DISTRICT CONFIRMED
THAT THE FEES WERE STILL PAYABLE AND HAD
NOT CHANGED. ACCORDINGLY, LUSARDI
INCLUDED IN ITS BID THE SUM OF $100,000.00
FOR WATER SERVICE FEES *** AS A ROUNDED
OFF FIGURE."
GSA'S PROJECT MANAGER STATES THAT IN RESPONSE TO LUSARDI'S INQUIRY:
"*** I ADVISED *** THAT ALL OF THE
WATER CONNECTION FEES WOULD BE PAID BY THE
GOVERNMENT AS SET FORTH IN NOTE 6 ON
DRAWING C-6. I CAUTIONED *** THAT THE
CONTRACTOR IS TO PAY FOR OTHER FEES IN
CONNECTION WITH THE DESIGN AND CONSTRUCTION
OF THE BORDER STATION AND THAT HE SHOULD
REVIEW THE GENERAL CONDITIONS, GSA FORM
1139, PARAGRAPH 8 'BUILDING CODES, FEES
AND CHARGES' WHICH PROVIDES IN PART THAT
'THE CONTRACTOR SHALL OBTAIN AND PAY ALL
FEES AND CHARGES FOR CONNECTIONS TO OUTSIDE
SERVICES AND FOR USE OF PROPERTY OUTSIDE
THE SITE.'
"LUSARDI PERSISTENTLY ASKED ME WHICH OF
THE LINE ITEMS FROM THE WATER DISTRICT
WERE INCLUDED IN NOTE 6 OF DRAWING C-6. I
ADVISED *** THAT SINCE I DID NOT HAVE
BEFORE ME THE LIST OF ITEMS OR THE WATER
DISTRICT'S APRIL 26 LETTER TO THE GOVERNMENT,
I COULD NOT RESPOND TO HIS INQUIRIES
ON SPECIFIC LINE ITEMS.
"MY ADVICE *** WAS TO THOROUGHLY REVIEW
THE GOVERNMENT'S NOTE 6 ON DRAWING C-6 AND
GSA FORM 1139, PARAGRAPH 8, SINCE I
BELIEVED THEM TO BE CLEAR. AT NO TIME DID
I ADVISE LUSARDI THAT THE METERS SET IN
CONCRETE VAULTS (THE FIRST ITEM ON HIS LIST
FROM THE WATER DISTRICT) WERE TO BE
EXCLUDED FROM HIS BASE BID. I ALSO AT NO
TIME TOLD LUSARDI THAT THE OTHER ITEMS HE
MENTIONED WERE TO BE INCLUDED IN LUSARDI'S
BASE BID."
HARPER LISTED ON ITS BID FORM ITS "LUMP SUM FOR FEES" AS "$-0-,"
WHILE LUSARDI LISTED ITS SUM FOR FEES AS "$100,000." GSA THOUGHT THAT
HARPER'S ENTRY FOR FEES MAY HAVE BEEN AN ERROR (EVEN THOUGH THE TOTAL OF
THE OTHER ELEMENTS OF ITS "SEPARATED PRICE" EXACTLY EQUALED ITS BASE
BID) AND IT CONSEQUENTLY REQUESTED THAT HARPER VERIFY ITS BID. HARPER
VERIFIED THE ACCURACY OF ITS BID, STATING THAT IT ENTERED ZERO AS THE
CHARGE FOR FEES BECAUSE UNDER THE TERMS OF THE RFTP MAJOR FEES WERE TO
BE EXCLUDED FROM THE BID, LEAVING ONLY MINOR FEES WHICH IT INCLUDED IN
THE GENERAL CONDITIONS OF ITS BASE BID.
LUSARDI FIRST ARGUES THAT ITS INCLUSION OF $100,000 FOR WATER FEES IN
ITS BASE BID WAS CONSISTENT WITH THE ORAL ADVICE IT RECEIVED FROM GSA'S
PROJECT MANAGER PRIOR TO BIDDING. ALTHOUGH LUSARDI CONCEDES THE PROJECT
MANAGER DID NOT TELL IT WHICH FEES SHOULD BE INCLUDED, THE PROTESTER
CONTENDS THAT HE "IMPLIED" THAT ALL FEES OTHER THAN THOSE FOR WATER
CONNECTION SHOULD BE INCLUDED. LUSARDI CONSEQUENTLY DETERMINED THAT ALL
CHARGES EXCEPT THAT FOR THE METERS TO BE SET IN CONCRETE VAULTS WERE TO
BE INCLUDED IN ITS BID, WHICH IT DID AT THE ROUNDED OFF FIGURE OF
$100,000. LUSARDI THEREFORE CONSIDERS ITS OWN BID AS RESPONSIVE BECAUSE
IT REFLECTS ITS COMMITMENT TO PERFORMING ALL OF THE OBLIGATIONS IT
UNDERSTOOD GSA TO REQUIRE OF A CONTRACTOR.
IN CONTRAST, LUSARDI CONTENDS, BY ENTERING ZERO AS THE LUMP SUM FOR
FEES, HARPER MADE AN AFFIRMATIVE SHOWING THAT IT EXCLUDED FROM ITS BID
THE FEES PAYABLE TO THE WATER DISTRICT FOR WATER SERVICE FOR THE
PROJECT. IT ARGUES THAT SINCE THESE FEES AMOUNT TO $100,000, THEY ARE
MATERIAL, AND THEREFORE THE FAILURE TO INCLUDE SUCH FEES RENDERED
HARPER'S BID NONRESPONSIVE. LUSARDI ARGUES FURTHER THAT BY ACCEPTING
HARPER'S BID AND ALLOWING IT TO ENTER ZERO, GSA WAS GIVING THE FIRM AN
UNFAIR COMPETITIVE ADVANTAGE BECAUSE HARPER WAS ABLE TO MAKE SURE IT
WOULD BE LOW, WHILE RETAINING THE RIGHT TO CLAIM A MISTAKE IN ITS BID IF
IT WAS TOO LOW, OR TO CLAIM, AS IT DID, THAT FEES WERE INCLUDED
ELSEWHERE IN ITS BID.
GSA RESPONDS THAT HARPER'S BID WAS RESPONSIVE BECAUSE THE INCLUSION
OF A SUM FOR FEES WAS FOR ACCOUNTING PURPOSES ONLY AND THEREFORE IT WAS
NOT A MATERIAL REQUIREMENT UPON WHICH A DETERMINATION OF
NONRESPONSIVENESS COULD BE BASED. ALTERNATIVELY, GSA ARGUES THAT EVEN
IF THIS WAS A MATERIAL REQUIREMENT, THE ENTRY OF ZERO IN THE SPACE
PROVIDED INDICATES HARPER'S INTENT TO PAY THE FEES AND MAKES THE BID
RESPONSIVE. GSA FURTHER RESPONDS THAT HARPER DID NOT HAVE AN UNFAIR
COMPETITIVE ADVANTAGE BECAUSE THE SPECIFICATIONS CLEARLY INDICATED THAT
WATER CONNECTION FEES DUE THE WATER DISTRICT ARE THE GOVERNMENT'S
RESPONSIBILITY AND LUSARDI SIMPLY MISINTERPRETED THE SOLICITATION
PROVISIONS REGARDING FEES AND ERRONEOUSLY INCLUDED WATER CONNECTION FEES
IN ITS BID. GSA ALSO DENIES THAT LUSARDI WAS EVER TOLD TO INCLUDE THESE
FEES IN ITS BID PRICE.
THE FACT THAT HARPER ENTERED ZERO FOR FEES WOULD NOT MAKE HARPER'S
BID NONRESPONSIVE. THE TEST OF A BID'S RESPONSIVENESS IS WHETHER THE
BID AS SUBMITTED COMPLIES WITH THE IFB'S MATERIAL PROVISIONS WITHOUT
EXCEPTION. WFT SERVICE CORP., B-206603, AUGUST 31, 1982, 82-2 CPD 190.
THE SOLICITATION CLEARLY STATED THAT THIS PRICING INFORMATION WAS FOR
ACCOUNTING PURPOSES ONLY AND DID NOT FORM THE BASIS FOR AWARD. THUS,
THIS INFORMATION WAS NOT MATERIAL AND THE FAILURE TO SUBMIT IT COULD NOT
RENDER A BID NONRESPONSIVE.
IT APPEARS THAT LUSARDI ERRONEOUSLY INCLUDED THESE FEES IN ITS BID,
WHILE HARPER APPARENTLY INTERPRETED THE SPECIFICATIONS CORRECTLY.
LUSARDI STATES THAT IF IT MISTAKENLY INCLUDED A CHARGE OF $100,000 FOR
FEES IN ITS BID, GSA COULD CORRECT THIS MISTAKE PURSUANT TO FEDERAL
PROCUREMENT REGULATIONS (FPR) SEC. 1-2.406-4, EVEN AFTER AWARD, SINCE
CORRECTION WOULD MAKE THE "CONTRACT" MORE FAVORABLE TO THE GOVERNMENT.
THIS REGULATION, HOWEVER, IS INAPPLICABLE TO THIS SITUATION. THE TERM
"MISTAKE" REFERS TO WHERE THE BIDDER INADVERTENTLY INCLUDES IN ITS BID
SOMETHING OTHER THAN WHAT IT INTENDED TO, SEE PAUL SCHMIDT CONSTRUCTION
COMPANY, B-204009, AUGUST 5, 1981, 81-2 CPD 99, WHEREAS LUSARDI INTENDED
TO INCLUDE THE $100,000 CHARGE FOR FEES AND IT DID. ITS "ERROR" STEMMED
FROM ITS INTERPRETATION OF THE SPECIFICATIONS AND THIS IS NOT THE TYPE
OF ERROR TO WHICH THIS REGULATION IS DIRECTED.
AS TO WHETHER GSA ADVISED LUSARDI TO INCLUDE THESE FEES IN ITS BID,
LUSARDI ADMITS IT WAS NOT SPECIFICALLY TOLD TO INCLUDE THE FEES BUT IT
READ INTO THE REMARKS OF THE PROJECT MANAGER THAT IT WAS TO INCLUDE
THEM. ASSUMING THAT LUSARDI IS ACTUALLY ALLEGING THAT IT WAS TOLD TO
INCLUDE THESE FEES, THE PROTESTER AND AGENCY HAVE MADE CONFLICTING
STATEMENTS ON THIS ISSUE. THE PROTESTER HAS THUS NOT MET ITS BURDEN OF
AFFIRMATIVELY PROVING THAT IT WAS ADVISED BY GSA TO BID AS IT DID.
VANGUARD INDUSTRIAL CORPORATION, B-204455, JANUARY 6, 1982, 82-1 CPD 17,
AFFIRMED ON RECONSIDERATION, B-204455.2, MARCH 1, 1982, 82-1 CPD 174.
SPECIFICATIONS
LUSARDI'S SECOND BASIS FOR PROTEST IS THAT HARPER'S BID IS
NONRESPONSIVE BECAUSE THE FIRM'S BID MATERIALLY DEVIATED FROM THE
PROJECT SPECIFICATIONS.
WITH REGARD TO THE METHOD OF PROCUREMENT USED HERE, WE STATED IN OUR
DECISION E.C.CAMPBELL, INC., B-205533, JULY 8, 1982, 82-2 CPD 34:
"TWO-STEP FORMAL ADVERTISING IS A HYBRID
METHOD OF PROCUREMENT, COMBINING THE
BENEFITS OF COMPETITIVE ADVERTISING WITH
THE FLEXIBILITY OF NEGOTIATION. THE
FIRST-STEP PROCEDURE IS SIMILAR TO A
NEGOTIATED PROCUREMENT IN THAT TECHNICAL
PROPOSALS ARE EVALUATED, DISCUSSIONS MAY
BE HELD, AND REVISED PROPOSALS MAY BE
SUBMITTED. THE SECOND STEP IS CONDUCTED
IN ACCORDANCE WITH FORMAL ADVERTISING
PROCEDURES, EACH FIRM BIDDING ON ITS OWN
TECHNICAL PROPOSAL. *** THE STEP-ONE
NEGOTIATION PROCEDURES DO NOT REQUIRE THAT
TECHNICAL PROPOSALS COMPLY WITH EVERY
DETAIL OF THE SPECIFICATIONS, BUT PROPOSALS
MUST SATISFY THE GOVERNMENT'S BASIC OR
ESSENTIAL REQUIREMENTS. 53 COMP.GEN. 47
(1973). IF A TECHNICAL PROPOSAL REPRESENTS
A BASIC CHANGE IN THE GOVERNMENT'S
ESSENTIAL REQUIREMENTS, IT CAN BE ACCEPTED
ONLY IF THE AGENCY INFORMS THE OTHER
OFFERORS OF THE CHANGE AND AFFORDS THEM AN
OPPORTUNITY TO SUBMIT REVISED PROPOSALS
BASED ON THE CHANGED REQUIREMENTS. BAIRD
CORPORATION, B-193261, JUNE 19, 1979, 79-1
CPD 435. THIS REFLECTS THE FUNDAMENTAL
PRINCIPLE THAT ALL OFFERORS MUST BE TREATED
FAIRLY AND EQUALLY SO AS TO PROMOTE FULL
AND FREE COMPETITION. RCA CORPORATION;
NORMAN R. SELINGER & ASSOCIATES, INC., 57
COMP.GEN. 809 (1978), 78-2 CPD 213."
TECHNICAL PROPOSALS CONTAINED CERTAIN SPECIFICATION REQUIREMENTS WHICH
WERE MANDATORY UPON ALL OFFERORS REGARDLESS OF THE DETAILS OF THEIR
INDIVIDUAL DESIGNS. GSA DOES NOT ARGUE THAT THE EXCEPTIONS HARPER IS
ALLEGED TO HAVE TAKEN DO NOT FALL WITHIN THESE MANDATORY REQUIREMENTS.
ON SEPTEMBER 27, HARPER SUBMITTED TO GSA AS PART OF ITS TECHNICAL
PROPOSAL A NUMBER OF PROPOSED CHANGES TO THE DRAWINGS AND SPECIFICATIONS
IN THE RFTP. HARPER MET WITH GSA TO DISCUSS THE PROPOSED DRAWING
CHANGES. AS A RESULT, HARPER REVISED ITS DRAWINGS IN ACCORDANCE WITH
THE GOVERNMENT'S OBJECTIONS AND RESUBMITTED THEM ON OCTOBER 3. GSA
FAILED TO REJECT SOME OF HARPER'S PROPOSED CHANGES AT THAT TIME,
HOWEVER, AND THEREFORE THEY WERE ACCEPTED AS PART OF THAT FIRM'S
TECHNICAL PROPOSAL. THESE DEVIATIONS IN THE DRAWINGS CORRESPOND WITH
SPECIFICATION CHANGES PROPOSED BY HARPER.
THE CHANGES WHICH HARPER PROPOSED, AND WHICH ARE IN ISSUE HERE,
RELATE TO SPECIFICATIONS FOR INSULATION, BUILT-UP ROOFING, SKYLIGHTS,
AND SUSPENDED ACOUSTICAL UNITS. THE SOLICITATION REQUIRED THAT EXTERIOR
CONCRETE MASONRY UNIT WALLS BE INSULATED WITH 2 INCH THICK SEMI-RIGID
FIBERGLASS BOARD; HARPER INSTEAD PROPOSED TO INSULATE THE WALLS WITH 2
INCH THICK RIGID BOARD WITH ATTACHED GYPSUM FINISH. THE SOLICITATION
ALSO REQUIRED THAT SEMI-RIGID GLASS FIBER INSULATION BOARD WITH A
THERMAL RESISTANCE OF R-13 BE ATTACHED BENEATH THE METAL ROOF DECK WITH
WIRE NETTING; HARPER PROPOSED TO PROVIDE INSULATION AS SPECIFIED OR IN
THE ALTERNATIVE TO LAY GLASS FIBER BATT INSULATION WITH A R-19 RATING ON
TOP OF THE SUSPENDED CEILING. AS TO THE BUILT-UP ROOF, THE SOLICITATION
SPECIFIED THAT IT MUST CONSIST OF A BASE SHEET OF 37 LB. ASBESTOS FELT,
THREE LAYERS OF 15 LB. ASBESTOS FELT, AND AN ASPHALT AND GRAVEL TOPPING.
HARPER PROPOSED TO MODIFY THE SPECIFICATIONS SO THAT THE ROOF WOULD
CONSIST OF THREE LAYERS OF 15 LB. ASBESTOS FELT AND ONE LAYER OF
MINERAL SURFACED-ASBESTOS CAP SHEET. HARPER FURTHER PROPOSED THAT
INSTEAD OF INSTALLING A DOUBLE-DOME PLASTIC SKYLIGHT AT THE MAIN
BUILDING AND WIRE-GLASS SKYLIGHTS AT THE TRUCK FACILITY BUILDING AND
HEADHOUSE AS REQUIRED BY THE SPECIFICATIONS, IT WOULD INSTALL
SINGLE-DOME PLASTIC SKYLIGHTS IN ALL THREE BUILDINGS. FINALLY, HARPER
PROPOSED TO MODIFY THE SOLICITATION'S REQUIREMENT THAT THE SUSPENDED
ACOUSTICAL UNITS BE A CONCEALED SYSTEM WITH 12 INCH X 12 INCH TILE
INSTALLED WITH SPLINES SO THAT INSTEAD THE SUSPENDED ACOUSTICAL UNITS
WOULD BE 24 INCHES X 48 INCHES IN SIZE WITH A LAY-IN TYPE SUPPORTING
SYSTEM.
GSA NOTES THAT ALTHOUGH IT FAILED TO REJECT THE CEILING INSULATION
AND ROOFING DEVIATIONS PRIOR TO ACCEPTANCE OF HARPER'S TECHNICAL
PROPOSAL, IT LATER DID SO IN PRE-BID OPENING TELEPHONE CONVERSATIONS
WITH HARPER IN WHICH HARPER ORALLY AGREED TO COMPLY WITH THE
SOLICITATION'S SPECIFICATIONS FOR THESE TWO FEATURES. SPECIFICALLY, GSA
STATES THAT PRIOR TO THE INITIAL BID OPENING ON NOVEMBER 3, ITS PROJECT
MANAGER NOTED THE PROVISION FOR "LAY-IN" CEILING INSULATION IN ONE OF
HARPER'S DRAWINGS; THAT HE ADVISED HARPER BY TELEPHONE THAT THIS WAS
NOT ACCEPTABLE; AND THAT HARPER AGREED TO PROVIDE THE SPECIFIED CEILING
INSULATION. AS TO THE BUILT-UP ROOF, PRIOR TO THE SECOND BID OPENING ON
DECEMBER 17, A REPRESENTATIVE OF LUSARDI TELEPHONED THE PROJECT MANAGER
AND NOTIFIED HIM THAT BASED UPON INFORMATION IT HAD OBTAINED FROM
ROOFING SUBCONTRACTORS, LUSARDI BELIEVED THAT HARPER INTENDED TO DEVIATE
FROM THE ROOFING SPECIFICATIONS. THE PROJECT MANAGER THEN TELEPHONED
HARPER ABOUT THIS AND HARPER AGAIN AGREED TO COMPLY WITH THE PERTINENT
SPECIFICATIONS. GSA OBSERVES THAT ALTHOUGH THROUGH OVERSIGHT NEITHER OF
THESE VERBAL AGREEMENTS WAS REDUCED TO WRITING, HARPER CONFIRMED THEM BY
A POST-BID OPENING LETTER OF APRIL 6, 1983.
OF COURSE, GSA SHOULD HAVE CONFIRMED IN WRITING HARPER'S AGREEMENT TO
MEET THE INSULATION AND ROOFING REQUIREMENTS BEFORE IT ACCEPTED THE
TECHNICAL PROPOSAL. HOWEVER, IT IS CLEAR THAT GSA SOUGHT AND OBTAINED
HARPER'S AGREEMENT, PRIOR TO THE STEP TWO BID OPENING, TO MEET THE
REQUIREMENTS, AND WE BELIEVE THAT UNDER THE CIRCUMSTANCES GSA COULD VIEW
HARPER'S BID AS ONE RESPONSIVE TO THE INSULATION AND ROOFING
REQUIREMENTS.
THIS LEAVES FOR CONSIDERATION THE DEVIATIONS GSA ACCEPTED RELATING TO
INSULATION OF THE MASONRY WALLS, SKYLIGHTS, AND SUSPENDED ACOUSTICAL
UNITS. GSA MAINTAINS THAT THE DEVIATION ON THE SUSPENDED ACOUSTICAL
UNITS APPLIES ONLY TO THE HEADHOUSE AND TRUCK BUILDING, BECAUSE
AMENDMENT NO. 3 REITERATED THIS REQUIREMENT FOR THE MAIN BUILDING.
SINCE IN ITS BID HARPER ACKNOWLEDGED RECEIPT OF THIS AMENDMENT, GSA
ARGUES, THE COMPANY CAN BE HELD TO THE SPECIFICATIONS IN THAT BUILDING.
GSA ESTIMATES AS FOLLOWS THE PRICE ADVANTAGE TO HARPER OF THESE
DEVIATIONS:
CONCRETE MASONRY UNIT WALLS INSULATION $10,790
SKYLIGHTS 8,865 FN1
SUSPENDED ACOUSTICAL UNITS 23,866
$43,521
GSA STATES THAT SINCE THE PRICE ADVANTAGE OF THESE ACCEPTED CHANGES IN
THE SPECIFICATIONS AMOUNTS TO LESS THAN THE $133,000 DIFFERENCE BETWEEN
THE TWO LOW BIDS, IT DOES NOT AFFECT THE RELATIVE STANDING OF THE
BIDDERS. THUS, GSA CONCLUDES THE AWARD SHOULD NOT BE DISTURBED. WE
AGREE.
AN AGENCY MAY WAIVE OR AFFORD THE BIDDER AN OPPORTUNITY TO CURE A
MINOR INFORMALITY OR IRREGULARITY WHICH PERTAINS TO SOME IMMATERIAL OR
INCONSEQUENTIAL DEFECT OR VARIATION FROM THE SOLICITATION'S
REQUIREMENTS. A BID MUST BE REJECTED AS NONRESPONSIVE, HOWEVER, WHEN IT
DEVIATES FROM THE SOLICITATION'S REQUIREMENTS SO AS TO AFFECT PRICE,
QUALITY, QUANTITY OR DELIVERY, IN MORE THAN A TRIVIAL MANNER WHEN
COMPARED TO THE TOTAL COST OR SCOPE OF THE CONTEMPLATED CONTRACT. WFT
SERVICE CORP., SUPRA.
THE DIFFERENCE BETWEEN THE TWO LOW BIDS IS $133,000; GSA ESTIMATES
THE VALUE TO HARPER OF THE EXCEPTIONS IT TOOK TO THE WALL INSULATION,
SKYLIGHTS AND SUSPENDED ACOUSTICAL UNITS TO BE $43,521. THIS IS
SUBSTANTIALLY BELOW THE AMOUNT WHICH WOULD AFFECT THE RELATIVE STANDING
OF THE TWO LOW BIDDERS: THEREFORE, WHETHER HARPER TOOK THESE EXCEPTIONS
TO THE SPECIFICATIONS OR WAS NOT PERMITTED BY GSA TO DO SO, IT WOULD
REMAIN THE LOW BIDDER. ALTHOUGH LUSARDI MAINTAINS THAT GSA'S COST
ESTIMATES ARE UNDERSTATED AND THAT THE MONETARY IMPACT OF THE EXCEPTIONS
TAKEN BY HARPER ARE IN FACT GREATER, IT HAS NOT SHOWN THAT THE COMBINED
VALUES OF THESE THREE ITEMS EQUALS OR EXCEEDS $133,000. WE CONCLUDE THAT
SINCE THE OUTCOME OF THE BIDDING HAS NOT BEEN SHOWN TO HAVE BEEN
AFFECTED, THE DEVIATIONS ACCEPTED BY GSA WERE NOT PREJUDICIAL TO THE
PROTESTER.
THE PROTEST IS DENIED.
FN1 GSA'S ESTIMATE OF $8,865 IS BASED ON $2,265 FOR A SINGLE DOME
PLASTIC SKYLIGHT INSTEAD OF A DOUBLE DOME PLASTIC SKYLIGHT IN THE MAIN
BUILDING AND HEADHOUSE AND $6,000 FOR A SINGLE DOME PLASTIC SKYLIGHT
INSTEAD OF A WIRE GLASS ONE IN THE TRUCK BUILDING. ACTUALLY, THE
SPECIFICATIONS CALL FOR A WIRE GLASS SKYLIGHT, NOT A DOUBLE DOME PLASTIC
SKYLIGHT, IN THE HEADHOUSE. THUS, THE PROPER ESTIMATE OF THE COST
ADVANTAGE USING GSA'S FIGURES WOULD BE $6,000 EACH FOR THE TRUCK
BUILDING AND HEADHOUSE AND $1,132 FOR THE MAIN BUILDING, TOTALING
$13,132.
B-210275.2, DEC 28, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PRIOR DECISION IS AFFIRMED ON RECONSIDERATION
WHERE THE PROTESTER HAS NOT SHOWN ANY ERROR OF LAW OR FACT WHICH
WOULD WARRANT REVERSAL OF THE DECISION.
2. A FIRM'S RECOURSE TO CONTRACTING AGENCY DOCUMENTS
THAT ALLEGEDLY SUPPORT ITS POSITION, BUT WHICH IT HAS NOT BEEN
ABLE TO SECURE FROM THAT AGENCY, IS TO PURSUE THE DISCLOSURE
REMEDIES PROVIDED IN THE FREEDOM OF INFORMATION ACT. MOREOVER,
GAO HAS NO AUTHORITY UNDER THAT ACT TO DETERMINE WHAT INFORMATION
OTHER AGENCIES MUST DISCLOSE.
UNITED STATES CONTRACTING CORPORATION - RECONSIDERATION:
UNITED STATES CONTRACTING CORPORATION (USCC) REQUESTS RECONSIDERATION
OF OUR DECISION IN UNITED STATES CONTRACTING CORPORATION, B-210275,
AUGUST 22, 1983, 83-2 CPD 222. IN THAT DECISION, WE DENIED USCC'S
PROTEST THAT IT WAS PRECLUDED FROM BIDDING BY ALLEGED DEFECTS IN
INVITATION FOR BIDS (IFB) NO. N62474-82-B-3235, ISSUED BY THE TERMINAL
ISLAND NAVAL COMPLEX, LONG BEACH, CALIFORNIA. THE IFB WAS FOR THE
MAINTENANCE AND REPLACEMENT OF APPROXIMATELY 39,000 HEATING AND AIR
CONDITIONING FILTERS. WE AFFIRM OUR DECISION.
USCC CONTENDS THAT WE IMPROPERLY CHARACTERIZED THE CONTRACT TO BE
AWARDED UNDER THE IFB AS A REQUIREMENTS CONTRACT AND ARGUES THAT OUR
DECISION IS INCORRECT TO THE EXTENT THAT IT RELIES ON THAT
CHARACTERIZATION. USCC BASES ITS CONTENTION ON THE FACT THAT THE IFB
SOLICITED BIDS ON A LUMP SUM PRICE BASIS FOR A SPECIFIC NUMBER OF
FILTERS AND FREQUENCY OF SERVICE, AND DID NOT PROVIDE FOR DELIVERIES TO
BE SCHEDULED BY THE PLACEMENT OF ORDERS WITH THE CONTRACTOR.
DEFENSE ACQUISITION REGULATION (DAR) SEC. 3-409.2(A) (1976 ED.)
DESCRIBES A REQUIREMENTS CONTRACT AS PROVIDING FOR "FILLING ALL ACTUAL
PURCHASE REQUIREMENTS OF SPECIFIC SUPPLIES OR SERVICES . . . DURING A
SPECIFIED CONTRACT PERIOD WITH DELIVERIES TO BE SCHEDULED BY THE TIMELY
PLACEMENT OF ORDERS UPON THE CONTRACTOR. . . ." THE REGULATION NOTES
THAT "AN ESTIMATED TOTAL QUANTITY IS STATED FOR THE INFORMATION OF
PROSPECTIVE CONTRACTORS, WHICH ESTIMATE SHOULD BE AS REALISTIC AS
POSSIBLE."
USCC IS CORRECT IN STATING THAT THE CONTRACT CONTEMPLATED BY THE IFB
DOES NOT STRICTLY MEET THE DAR DEFINITION OF A REQUIREMENTS CONTRACT
SINCE IT DOES NOT PROVIDE FOR PLACEMENT OF ORDERS UPON THE CONTRACTOR
AND PAYMENT ON THAT BASIS. THE EMPHASIS IN OUR DECISION, HOWEVER, WAS
NOT ON CONTRACT TYPE BUT ON THE FACT THAT THE IFB CONTAINED THE NAVY'S
STANDARD REQUIREMENTS CLAUSE, WHICH CAUTIONS BIDDERS THAT THE QUANTITIES
OF SUPPLIES OR SERVICES SPECIFIED ARE ONLY ESTIMATED. OUR POINT WAS
THAT EVEN IF THE SPECIFIED QUANTITIES WERE NOT COMPLETELY ACCURATE,
BIDDERS WERE ON NOTICE OF THIS FACT AND COULD PROTECT THEMSELVES BY
ALLOWING FOR THAT RISK IN COMPUTING THEIR BIDS. SEE PALMETTO
ENTERPRISES, 57 COMP.GEN. 271 (1978), 78-1 CPD 116. WE CONSIDER THIS
PRINCIPLE APPLICABLE EVEN WHERE THE TYPE OF CONTRACT UTILIZED DOES NOT
MEET THE STRICT DEFINITION OF A REQUIREMENTS CONTRACT. ID.
CONSEQUENTLY, WE FIND NO MERIT TO USCC'S POSITION.
USCC ALSO ARGUES THAT IT HAS BEEN UNABLE TO PROVE THE IFB DEFECTIVE
BECAUSE THE NAVY HAS NOT SUPPLIED IT WITH ALL OF THE CORRESPONDENCE
BETWEEN THE NAVAL COMPLEX AND THE NAVY OFFICE OF GENERAL COUNSEL. WE
FAIL TO SEE HOW THE ABSENCE OF THIS INFORMATION PREVENTED USCC FROM
MAKING ITS CASE SINCE ITS PROTEST IS BASED ON THE PREMISE THAT AS THE
INCUMBENT CONTRACTOR, IT HAS SUPERIOR KNOWLEDGE OF THE ACTUAL CORRECT
SPECIFICATIONS. IN ADDITION, IF USCC DESIRES ACCESS TO THE SPECIFIED
DOCUMENTS, IT MAY REQUEST THEM FROM THE NAVY UNDER THE FREEDOM OF
INFORMATION ACT (FOIA). OUR OFFICE, HOWEVER, HAS NO AUTHORITY UNDER
FOIA TO DETERMINE WHAT INFORMATION GOVERNMENT AGENCIES MUST DISCLOSE.
PHILCON CORP., B-206905; B-208223; B-208034, MARCH 29, 1983, 83-1 CPD
319.
THE REMAINDER OF USCC'S REQUEST FOR RECONSIDERATION ESSENTIALLY
CONSISTS OF FACTS AND DETAILS WHICH USCC BELIEVES SUPPORT ITS ORIGINAL
PROTEST. OUR BID PROTEST PROCEDURES REQUIRE THAT REQUESTS FOR
RECONSIDERATION SPECIFY ANY ERRORS OF LAW OR INFORMATION NOT PREVIOUSLY
CONSIDERED WHICH WOULD WARRANT REVERSAL OF OUR PRIOR DECISION. 4 C.F.
R. SEC. 21.9(A) (1983). INFORMATION NOT PREVIOUSLY CONSIDERED REFERS TO
THAT WHICH MAY HAVE BEEN OVERLOOKED BY OUR OFFICE OR TO WHICH THE
PROTESTER DID NOT HAVE ACCESS DURING THE PENDENCY OF THE ORIGINAL
PROTEST. SPACE AGE ENGINEERING, INC. - RECONSIDERATION, B-205594.3,
SEPTEMBER 24, 1982, 82-2 CPD 269.
ALL OF THE INFORMATION RELIED ON BY USCC WAS EITHER CONSIDERED IN OUR
PRIOR DECISION OR WAS AVAILABLE TO USCC AT THE TIME OF OUR INITIAL
CONSIDERATION OF THE PROTEST. IN THE FORMER CATEGORY IS THE FACT THAT
THOSE BIDDERS WHO ALLEGEDLY DID NOT POSSESS PRIOR KNOWLEDGE OF THE
ACTUAL JOB SITE CONDITIONS BID HIGHER THAN THOSE BIDDERS - USCC
IDENTIFIES TWO - WHO ALLEGEDLY DID HAVE SUCH KNOWLEDGE. FN1 IN THE
LATTER CATEGORY ARE A NUMBER OF EXAMPLES OF ALLEGED SPECIFICATION
DEFICIENCIES DISCOVERED BY USCC DURING THE TIME IT HELD THE CONTRACT FOR
THE WORK. THERE IS, THEREFORE, NOTHING IN USCC'S ASSERTIONS THAT WAS
NOT PRESENTED AND CONSIDERED OR WHICH COULD NOT HAVE BEEN PRESENTED IN
CONNECTION WITH ITS INITIAL PROTEST. CONSEQUENTLY, NOTHING IN USCC'S
REQUEST FOR RECONSIDERATION WARRANTS REVERSAL OF OUR INITIAL DECISION.
OUR PRIOR DECISION IS AFFIRMED.
FN1 THIS IN FACT WAS PART OF THE BASIS FOR OUR CONCLUSION THAT USCC
WAS NOT PREJUDICED BY THE ALLEGED SOLICITATION DEFICIENCIES IN ANY
EVENT.
B-210275, AUG 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST THAT SOLICITATION MISSTATES QUANTITIES
OF FILTERS NEEDED TO MAINTAIN HEATING, AIR CONDITIONING, AND
VENTILATION SYSTEMS IS DENIED. AN AGENCY PROPERLY MAY STATE ITS
NEEDS IN TERMS OF A REASONABLY ACCURATE ESTIMATE OF THE QUANTITY
OF WORK REQUIRED, AND THE PROTESTER HAS NOT SHOWN THAT THE
AGENCY'S ESTIMATE IS UNREASONABLE.
2. PROTEST THAT SOLICITATION CONTAINS INCORRECT
FILTER SIZE SPECIFICATIONS AND FAILS TO IDENTIFY THE TYPES OF
FILTERS REQUIRED IS DENIED. EVEN IF PROTESTER IS CORRECT, IT HAS
NOT SHOWN THAT IT WAS PREJUDICED BY SUCH DEFECTS.
3. PROTEST AGAINST ALLEGED SOLICITATION
IMPROPRIETIES THAT WERE APPARENT PRIOR TO BID OPENING IS DISMISSED
AS UNTIMELY BECAUSE IT WAS NOT FILED BEFORE BID OPENING, AS
REQUIRED BY GAO BID PROTEST PROCEDURES.
UNITED STATES CONTRACTING CORPORATION:
UNITED STATES CONTRACTING CORPORATION (USCC) PROTESTS THE
SOLICITATION OF BIDS UNDER INVITATION FOR BIDS (IFB) NO.
N62474-82-B-3235 ISSUED BY THE TERMINAL ISLAND NAVAL COMPLEX, LONG
BEACH, CALIFORNIA. THE IFB ANTICIPATES THE AWARD OF A REQUIREMENTS
CONTRACT FOR THE MAINTENANCE AND REPLACEMENT OF APPROXIMATELY 39,000
FILTERS ANNUALLY IN A NUMBER OF LISTED HEATING, AIR CONDITIONING, AND
VENTILATION SYSTEMS, AND THE REPAIR AND MAINTENANCE OF VARIOUS AIR
SCRUBBERS. WE DENY THE PROTEST IN PART AND DISMISS IT IN PART.
USCC IS THE INCUMBENT CONTRACTOR FOR A PORTION OF THE WORK AND STATES
THAT IT IS UNABLE TO BID BECAUSE IT KNOWS, BASED ON ITS EXPERIENCE, THAT
THE IFB IS INACCURATE AND INCOMPLETE. IT CONTENDS THAT THE FILTER
REPLACEMENT SCHEDULE IN THE IFB INCORRECTLY IDENTIFIES THE QUANTITIES
AND SIZES OF THE FILTERS INVOLVED, AND DOES NOT SPECIFY THE TYPE OF
FILTERS TO BE REPLACED.
THE ORIGINAL SOLICITATION WAS CANCELED, REVISED AND REISSUED AFTER
USCC COMPLAINED THAT IT WAS DEFECTIVE. DUE TO THE PROTESTER'S CONTINUED
INSISTENCE THAT THE SPECIFICATIONS WERE INACCURATE AND INCOMPLETE, THE
NAVY ALSO AMENDED THE REVISED SOLICITATION. THE NAVY CONTENDS THAT THE
AMENDMENTS TO THE IFB ADEQUATELY CORRECTED THE REQUIRED QUANTITIES,
SIZES AND TYPES OF FILTERS. IT ALSO STATES THAT THE QUANTITIES
SPECIFIED ARE CONSIDERED TO BE AN ACCURATE ESTIMATE OF ITS REQUIREMENTS.
WITH REGARD TO THE PROTESTER'S ALLEGATION THAT THE QUANTITIES OF
FILTERS REQUIRED ARE INCORRECTLY SPECIFIED, WE FIRST POINT OUT THAT AN
AGENCY'S REQUIREMENTS PROPERLY MAY BE STATED IN TERMS OF THE ESTIMATED
QUANTITY OF WORK ANTICIPATED UNDER THE CONTRACT. G&B PACKING COMPANY,
INC., B-204192, APRIL 20, 1982, 82-1 CPD 359. HERE, THE IFB CONTAINED
THE NAVY'S STANDARD REQUIREMENTS CLAUSE, WHICH CAUTIONS OFFERORS THAT
THE QUANTITIES OF SUPPLIES OR SERVICES SPECIFIED IN THE IFB ARE ONLY
ESTIMATED QUANTITIES.
WHILE IT IS INCUMBENT ON THE CONTRACTING ACTIVITY TO MAKE THE
ESTIMATE OF ITS NEEDS AS ACCURATE AS POSSIBLE IN ORDER TO ASSURE THAT
BIDDERS ARE COMPETING ON A COMMON BASIS, G&B PACKING COMPANY, INC.,
SUPRA, THERE IS NO REQUIREMENT THAT THE ESTIMATE BE ABSOLUTELY CORRECT.
SPACE SERVICES INTERNATIONAL CORPORATION, B-207888.4, .5, .6, .7,
DECEMBER 13, 1982, 82-2 CPD 525. THE ESTIMATED QUANTITIES SIMPLY MUST
BE A REASONABLY ACCURATE REPRESENTATION OF ANTICIPATED ACTUAL NEEDS.
ID.
USCC HAS FAILED TO SHOW THAT THE FILTER QUANTITIES CONTAINED IN THE
IFB ARE NOT A REASONABLY ACCURATE ESTIMATE OF THE NAVY'S NEEDS.
ALTHOUGH USCC SUBMITTED A MARKED-UP COPY OF THE IFB REPLACEMENT SCHEDULE
IDENTIFYING THOSE FILTER QUANTITIES IT CONSIDERS INCORRECT, IT DID NOT
INDICATE WHAT IT BELIEVES THE CORRECT QUANTITIES ARE, DESPITE THE FACT
THAT IT QUESTIONS THE IFB FIGURES ON THE BASIS OF ITS SUPERIOR KNOWLEDGE
AS AN INCUMBENT CONTRACTOR. THUS, EVEN ASSUMING THAT SOME OF THE
QUANTITIES ARE IN FACT INCORRECT, WE FIND NO SUPPORT FOR A CONCLUSION
THAT THEY ARE SO OVERSTATED OR UNDERSTATED THAT THE GOVERNMENT ESTIMATE
CANNOT BE CONSIDERED REASONABLY ACCURATE. THIS IS PARTICULARLY TRUE IN
LIGHT OF THE FACT THAT A TOTAL QUANTITY OF APPROXIMATELY 39,000 FILTERS
IS INVOLVED. CONSEQUENTLY, THIS ASPECT OF THE PROTEST IS DENIED.
USCC ALSO ALLEGES THAT THE SIZES OF THE FILTERS TO BE REPLACED ARE
INCORRECTLY SPECIFIED, AND THAT THE TYPE OF FILTERS TO BE REPLACED IS
NOT INDICATED. WE HAVE RECOGNIZED THAT SOLICITATIONS MUST BE DRAFTED IN
A MANNER THAT INFORMS ALL BIDDERS, IN CLEAR AND UNAMBIGUOUS TERMS, WHAT
WILL BE REQUIRED OF THEM UNDER THE CONTRACT TO BE AWARDED. CUMMINGS
MARINE SYSTEMS, INC., B-197506, AUGUST 21, 1980, 80-2 CPD 136.
THE NAVY SAYS IT CORRECTED THE ERRORS IN FILTER TYPES AND SIZES WHEN
IT AMENDED THE REVISED IFB. IN THE MARKED-UP COPY OF THE IFB
REPLACEMENT SCHEDULE SUBMITTED BY THE PROTESTER, HOWEVER, A LARGE NUMBER
OF FILTERS ARE IDENTIFIED AS INCORRECTLY SPECIFIED BY SIZE, AND AS NOT
SPECIFIED BY TYPE.
WE DENY THIS ASPECT OF USCC'S PROTEST BECAUSE WE CANNOT CONCLUDE THAT
THE PROTESTER HAS SUFFERED ANY ACTUAL PREJUDICE, EVEN IF ITS POSITION IS
CORRECT. SEE SAUDI MAINTENANCE COMPANY, LTD., B-205021, JUNE 8, 1982,
82-1 CPD 552, AT 5. ALTHOUGH USCC STATES THAT IT WAS UNABLE TO BID ON
THE BASIS OF "INCORRECT AND INCOMPLETE" SPECIFICATIONS, IT PREMISES ITS
PROTEST ON ITS ACTUAL COGNIZANCE OF THE CORRECT FILTER TYPES AND SIZES.
THUS, USCC CLEARLY WAS NOT REQUIRED TO GUESS AT THE CORRECT
SPECIFICATIONS, AS IT ALLEGES.
FURTHER, THERE HAS BEEN NO SHOWING THAT THE INCLUSION OF INCORRECT
FILTER SIZES, OR THE FAILURE TO IDENTIFY FILTER TYPES, HAD A PREJUDICIAL
IMPACT ON BID PRICES. USCC HAS NEITHER ALLEGED NOR SHOWN THAT BIDDERS
WERE MISLED INTO BIDDING UNREALISTICALLY LOW PRICES THAT USCC COULD NOT
HAVE MATCHED DUE TO ITS KNOWLEDGE OF THE CORRECT SPECIFICATIONS.
IN THAT REGARD, USCC ITSELF STATES THAT THE SECOND AND THIRD LOW
BIDDERS IN FACT WERE FAMILIAR WITH THE ACTUAL CONTRACT REQUIREMENTS AS A
RESULT OF FORMER OR CURRENT CONTRACTS. THE LOW BID WAS ONLY ABOUT $3600
LESS THAN THE SECOND LOW BID AND, IN ANY EVENT, BOTH THE FIRST AND
SECOND LOW BIDDERS WERE FOUND NONRESPONSIBLE. THE PROPOSED AWARDEE, WHO
IS THE THIRD LOW BIDDER, IS ALSO AN INCUMBENT CONTRACTOR FOR REPAIR AND
MAINTENANCE OF THE HEATING, VENTILATION, AND AIR CONDITIONING UNITS
INCLUDED IN THIS IFB. IT THEREFORE WAS IN A POSITION SIMILAR TO THAT OF
THE PROTESTER. THIS RECORD SIMPLY DOES NOT SUPPORT A FINDING THAT THE
PROTESTER WAS PREJUDICED BY THE ALLEGEDLY DEFICIENT SPECIFICATIONS IN
THIS CASE.
AFTER IT FILED ITS INITIAL PROTEST WITH THIS OFFICE, USCC SUBMITTED A
SUPPLEMENTAL DOCUMENT IN WHICH IT RAISED SEVERAL NEW ALLEGATIONS. THESE
WERE THAT THE SPECIFICATIONS CONCERNING THE REPAIR AND MAINTENANCE OF
THE AIR SCRUBBERS WERE DEFICIENT; THAT UNDER THE TERMS OF THE IFB, THE
PRICE TO REPAIR THE SCRUBBERS IMPROPERLY WAS TO BE NEGOTIATED AFTER
CONTRACT AWARD; AND THAT THE IFB CONTAINED A MISCLASSIFICATION OF LABOR
NEEDS. WE FIND THESE ISSUES TO BE UNTIMELY RAISED.
OUR BID PROTEST PROCEDURES, AT 4 C.F.R. SEC. 21.2(B)(1) (1983),
REQUIRE THAT PROTESTS BASED ON IMPROPRIETIES APPARENT IN A SOLICITATION
PRIOR TO BID OPENING BE RAISED BEFORE THAT DATE. IN THIS CASE, USCC
FILED ITS SUPPLEMENTAL SUBMISSION 3 WEEKS AFTER BID OPENING.
CONSEQUENTLY, THIS PORTION OF THE PROTEST IS DISMISSED.
THE PROTEST IS DENIED IN PART AND DISMISSED IN PART.
B-210266, MAY 3, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE THE EVALUATION OF "EXPERIENCE" IN A TECHNICAL PROPOSAL IS
TO BE BASED ON THE EXPERIENCE OF THE PERSONNEL TO BE ASSIGNED TO A
CONTRACT, THE RESUMES OF THOSE PERSONNEL INCLUDED IN THE PROPOSAL MUST
SUPPORT THE LEVEL OF EXPERIENCE CLAIMED IN THE TEXT OF THE PROPOSAL.
2. A TECHNICAL EVALUATION MUST BE BASED ON INFORMATION CONTAINED IN
THE PROPOSAL AND, CONSEQUENTLY, A PRE-AWARD SURVEY IS NOT A SUBSTITUTE
FOR INFORMATION THAT SHOULD HAVE BEEN INCLUDED IN AN OFFEROR'S TECHNICAL
PROPOSAL.
3. AGENCY DETERMINATION IN THE COURSE OF A TECHNICAL EVALUATION THAT
THE PROPOSAL SUBMITTED BY A SMALL BUSINESS CONCERN DOES NOT DEMONSTRATE
ADEQUATE EXPERIENCE OR RESOURCE CAPABILITY IS AN ELEMENT OF PROPOSAL
EVALUATION, NOT A DETERMINATION OF NONRESPONSIBILITY REQUIRING REFERRAL
TO THE SMALL BUSINESS ADMINISTRATION.
NUMAX ELECTRONICS INCORPORATED:
NUMAX ELECTRONICS INCORPORATED PROTESTS THE REJECTION OF THE PROPOSAL
IT SUBMITTED IN RESPONSE TO REQUEST FOR PROPOSALS (RFP) NO.
N00189-82-R-0430 ISSUED BY THE DEPARTMENT OF THE NAVY FOR TECHNICAL AND
ANALYTICAL SUPPORT SERVICES. NUMAX CONTENDS THAT THE NAVY IMPROPERLY
APPLIED THE EVALUATION CRITERIA SET FORTH IN THE RFP, THAT THE NAVY
SHOULD HAVE REFERRED ITS FINDINGS TO THE SMALL BUSINESS ADMINISTRATION
(SBA) FOR A CERTIFICATE OF COMPETENCY AND THAT THE FINDINGS OF A
PRE-AWARD SURVEY OF NUMAX SHOULD HAVE BEEN INCORPORATED IN THE
EVALUATION OF ITS PROPOSAL. WE DENY THE PROTEST.
THE SOLICITATION CONTEMPLATES A COST-PLUS-FIXED-FEE CONTRACT FOR
TECHNICAL AND ANALYTICAL SUPPORT FOR THE 1985 OPERATIONAL EFFECTIVENESS
DEMONSTRATION OF THE FUNCTIONAL SEGMENTS OF THE PROGRAM FOR JOINT
INTEROPERABILITY OF TACTICAL COMMAND AND CONTROL SYSTEMS (JINTACCS).
THE SUPPORT SERVICES INCLUDE THE DEVELOPMENT OF DATA SELECTION AND
ANALYSIS METHODOLOGY, THE PROVISION OF DATA COLLECTION TRAINING AND THE
PREPARATION OF ANALYSIS REPORTS.
THE RFP DISCLOSED THAT PROPOSALS WOULD BE EVALUATED ON THE BASIS OF
THREE FACTORS, TECHNICAL, EXPERIENCE AND RESOURCES, AND SET FORTH A
NUMBER OF SPECIFIC SUBFACTORS UNDER EACH FACTOR. THE THREE TECHNICAL
EVALUATION FACTORS WERE DESIGNATED AS 5-2/3 TIMES AS IMPORTANT AS COST
IN MAKING AWARD.
PRIOR TO THE SUBMISSION OF INITIAL PROPOSALS, NUMAX EXPRESSED CONCERN
TO CONTRACTING OFFICIALS THAT THE EXPERIENCE SUBFACTORS SEEM TO FOCUS ON
CORPORATE EXPERIENCE RATHER THAN THE EXPERIENCE OF INDIVIDUAL PERSONNEL.
THE NAVY RESPONDED WITH AMENDMENT 0004 WHICH CLARIFIED THE EXPERIENCE
FACTOR, STATING THAT EXPERIENCE "REFERS TO PERSONNEL EXPERIENCE REQUIRED
WITHIN THE CADRE OF PERSONNEL TO BE ASSIGNED UNDER THE CONTRACT. THE
EXPERIENCE MUST BE ADDRESSED IN INDIVIDUAL RESUMES TO BE SUBMITTED AS
PART OF THE TECHNICAL PROPOSAL."
FOUR FIRMS, INCLUDING NUMAX, SUBMITTED PROPOSALS IN RESPONSE TO THE
RFP. A SOURCE EVALUATION BOARD (SEB) EVALUATED THE PROPOSALS AND FOUND
NUMAX'S PROPOSAL TO BE INADEQUATE WITH RESPECT TO EACH OF THE THREE
TECHNICAL FACTORS DESIGNATED IN THE RFP. CONSEQUENTLY, THE NAVY
REJECTED NUMAX'S PROPOSAL AS TECHNICALLY UNACCEPTABLE. THE NAVY ALSO
FOUND TWO OTHER PROPOSALS TO BE TECHNICALLY UNACCEPTABLE, LEAVING B.D.
M. CORPORATION AS THE ONLY TECHNICALLY ACCEPTABLE FIRM.
INITIALLY, NUMAX CONTENDS THAT THE FINDING OF TECHNICAL
UNACCEPTABILITY WAS PREMISED UPON AN IMPROPER APPLICATION OF THE
EXPERIENCE SUBFACTORS. NUMAX BELIEVES THAT THE SEB IGNORED AMENDMENT
0004'S EMPHASIS ON INDIVIDUAL RATHER THAN CORPORATE EXPERIENCE. NUMAX
HAS NOT, HOWEVER, SPECIFIED IN WHAT WAY THE EVALUATION IS INCONSISTENT
WITH AMENDMENT 0004.
WE FIND THAT NUMAX'S CONTENTION IS NOT SUPPORTED BY THE RECORD. IN
OUR VIEW, THE PREPONDERANCE OF THE EVALUATION COMMENTS OF THE SEB
RELATES TO INFORMATION CONTAINED IN INDIVIDUAL RESUMES OR INFORMATIONAL
DEFICIENCIES OF INDIVIDUAL RESUMES, WHICH IS CONSISTENT WITH AMENDMENT
0004. CONTRARY TO NUMAX'S ASSERTION, WE FIND THAT THE EVALUATION OF THE
EXPERIENCE SECTION OF THE PROPOSAL WAS REASONABLE AND CONSISTENT WITH
THE RFP AND AMENDMENT 0004.
FOR EXAMPLE, UNDER THE SUBFACTOR JINTACCS PROGRAM EXPERIENCE, THE SEB
NOTED THAT THE TEAM LEADER HAD ONLY 1 YEAR OF SUCH EXPERIENCE, AND THE
PROJECT MANAGER AND SENIOR ANALYST HAD NO JINTACCS EXPERIENCE AT ALL.
SIMILARLY, THE SEB FOUND THAT THE RESUMES INDICATED THAT ONLY ONE
STAFFER HAD EXPERIENCE IN OPERATIONAL ANALYSIS, ANOTHER SUBFACTOR. WITH
RESPECT TO SEVERAL OTHER SUBFACTORS, THE SEB FOUND THAT THE LEVEL OF
EXPERIENCE NUMAX CLAIMED IN THE TEXT OF ITS PROPOSAL WAS NOT SUPPORTED
BY THE INDIVIDUAL RESUMES SUBMITTED AS A PART OF THE PROPOSAL. WE FIND
THAT THE FOCUS OF THESE EVALUATION COMMENTS IS CLEARLY ON THE EXPERIENCE
OF NUMAX'S PERSONNEL AND NOT ON NUMAX'S CORPORATE EXPERIENCE.
ADDITIONALLY, WE POINT OUT THAT THE NAVY FOUND NUMAX'S PROPOSAL TO BE
SUBSTANTIALLY INADEQUATE IN THE OTHER TWO EVALUATION CATEGORIES. THE SEB
COMMENTS INDICATE THAT THE INADEQUACIES IN THESE CATEGORIES WERE
WIDE-RANGING AND SUBSTANTIAL. NUMAX HAS NOT SPECIFICALLY QUESTIONED THE
NAVY'S FINDINGS IN THESE TWO EVALUATION AREAS. WE BELIEVE THAT THESE
FINDINGS, WHEN VIEWED WITH THE INADEQUACIES PERCEIVED IN THE EXPERIENCE
CATEGORY, FIRMLY SUPPORT THE NAVY'S FINDING OF TECHNICAL
UNACCEPTABILITY. WE CONCLUDE THAT THE EVALUATION WAS REASONABLE AND IN
ACCORD WITH THE EVALUATION CRITERIA DELINEATED IN THE RFP AND AMENDMENT
0004. MEDIA WORKS, INC., B-204602.2, JANUARY 19, 1982, 82-1 CPD 42.
NUMAX NEXT CONTENDS THAT A PRE-AWARD SURVEY OF NUMAX CONDUCTED BY THE
DEFENSE CONTRACT ADMINISTRATION SERVICES AREA, SPRINGFIELD, NEW JERSEY,
SHOULD HAVE BEEN CONSIDERED BY THE SEB IN EVALUATING NUMAX' PROPOSAL.
THE SURVEY WAS APPARENTLY CONDUCTED 1 MONTH AFTER THE CLOSING DATE FOR
RECEIPT OF INITIAL PROPOSALS.
A TECHNICAL EVALUATION MUST BE BASED UPON THE INFORMATION CONTAINED
IN THE PROPOSAL, SO THAT NO MATTER HOW CAPABLE AN OFFEROR MAY BE, IT
RUNS THE RISK OF LOSING THE COMPETITION IF IT DOES NOT SUBMIT AN
ADEQUATE PROPOSAL. BLURTON, BANKS & ASSOCIATES, INC., B-205865, AUGUST
10, 1982, 82-2 CPD 121. THUS, IF THE SURVEY OF NUMAX'S PREMISES WAS
CONDUCTED IN CONNECTION WITH THIS PROCUREMENT (IT IS NOT CLEAR FROM THE
RECORD WHETHER THE SURVEY NUMAX REFERS TO WAS CONDUCTED WITH RESPECT TO
THIS PROCUREMENT OR SOME OTHER PROCUREMENT), THE USE OF THE SURVEY'S
RESULTS FOR EVALUATION PURPOSES WOULD BE IMPROPER. THUS, NUMAX IS
MISGUIDED TO THE EXTENT IT BELIEVES THE PRE-AWARD SURVEY SHOULD BE USED
AS A SUBSTITUTE FOR INFORMATION THAT SHOULD HAVE BEEN INCLUDED IN ITS
WRITTEN PROPOSAL.
NUMAX ALSO ARGUES THAT THE RFP UNREASONABLY LIMITED TECHNICAL
PROPOSALS TO 50 PAGES AND THAT IT COULD HAVE SUPPLIED MORE COMPLETE AND
DETAILED RESUMES HAD THE NAVY REQUESTED IT. TO THE EXTENT NUMAX IS
COMPLAINING OF THE 50 PAGE RESTRICTION, THAT COMPLAINT, SINCE IT IS
BASED ON AN ALLEGED SOLICITATION IMPROPRIETY, SHOULD HAVE BEEN FILED
WITH OUR OFFICE PRIOR TO THE CLOSING DATE FOR INITIAL PROPOSALS. 4 C.
F.R. SEC. 21.2(B)(1) (1983). SINCE THE PROTEST WAS FILED WELL AFTER
THAT DATE, WE WILL NOT CONSIDER THE REASONABLENESS OF THE LIMITATION.
LAST, NUMAX CONTENDS THAT THE NAVY'S FINDINGS WITH RESPECT TO THE
EXPERIENCE AND RESOURCES FACTORS CONCERN NUMAX'S RESPONSIBILITY. SINCE
NUMAX IS A SMALL BUSINESS CONCERN, IT ARGUES, THESE FINDINGS SHOULD HAVE
BEEN REFERRED TO THE SBA FOR A CERTIFICATE OF COMPETENCY DETERMINATION.
UNDER THE PROVISIONS OF THE SMALL BUSINESS ACT, 15 U.S.C. SEC. 637(
B)(7)(SUPP. IV, 1980), NO SMALL BUSINESS CONCERN MAY BE DENIED AN AWARD
BECAUSE OF NONRESPONSIBILITY WITHOUT REFERRAL BY THE AGENCY TO THE SBA
FOR A FINAL DISPOSITION. HOWEVER, SOME MATTERS WHICH MAY BEAR ON
RESPONSIBILITY MAY BE ALSO CONSIDERED AS PART OF A TECHNICAL EVALUATION
WHEN NEGOTIATION PROCEDURES ARE USED IF THE AGENCY HAS A LEGITIMATE NEED
TO MAKE A COMPARATIVE EVALUATION OF RESPONSIBILITY-TYPE FACTORS. THUS,
WHEN SUCH FACTORS ARE IDENTIFIED IN AN RFP AS BEING ON PROPOSAL
EVALUATION, AS WAS THE CASE HERE, A FINDING OF TECHNICAL UNACCEPTABILITY
IS ONLY A QUESTION OF PROPOSAL EVALUATION AND IS NOT A NONRESPONSIBILITY
DETERMINATION REQUIRING REFERRAL TO THE SBA. SEE R. H. RITCHEY,
B-205602, JULY 7, 1982, 82-2 CPD 28.
THE PROTEST IS DENIED.
B-210265, MAR 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
BID RECEIVED ON A TOTAL SMALL BUSINESS SET-ASIDE SOLICITATION WHICH
FAILED TO INDICATE WHETHER BIDDER WOULD FURNISH PRODUCTS MANUFACTURED OR
PRODUCED BY SMALL BUSINESS WAS PROPERLY REJECTED AS NONRESPONSIVE.
ACE METAL FABRICATORS, INC.:
INVITATION FOR BIDS (IFB) NO. DLA400-82-B-6627 WAS ISSUED BY THE
DEFENSE LOGISTICS AGENCY, DEFENSE GENERAL SUPPLY CENTER (DGSC),
RICHMOND, VIRGINIA, AS A 100-PERCENT SMALL BUSINESS SET-ASIDE WITH A
LABOR SURPLUS AREA PREFERENCE. BID OPENING WAS ON NOVEMBER 2, 1982.
THE LOW BIDDER, ACE METAL FABRICATORS, INC. (ACE METAL), PROTESTS THE
REJECTION OF ITS TELEGRAPHIC BID SUBMITTED PRIOR TO BID OPENING AND ITS
FORMAL BID DOCUMENT RECEIVED BY DGSC ON NOVEMBER 10, 1982.
THE PROTEST IS DENIED.
ACE METAL'S TELEGRAPHIC BID, IN PERTINENT PART, READ AS FOLLOWS:
"SUBJECT TO ALL TERMS CONDITIONS AND
PROVISIONS OF SOLICITATION DLA400-82-B-6627,
THE FOLLOWING OFFER IS MADE:
* * * * *
"THE PRICE IS SUBJECT TO 1/4 PERCENT TIME
DISCOUNT FOR PAYMENT WITHIN 20 DAYS
"FORMAL BID FOLLOWS."
ACCORDING TO ACE METAL, ITS BID WAS REJECTED AS NONRESPONSIVE BECAUSE
OF THE OMISSIONS FROM ITS TELEGRAPHIC BID OF REPRESENTATIONS AS TO SIZE
STATUS OR PLACE OF MANUFACTURE, WHICH WERE REQUIRED BY THE SOLICITATION.
ACE METAL ARGUES THAT THE BID DOCUMENT CONTAINED CLAUSES INDICATING
THAT ACE METAL WAS A SMALL BUSINESS FIRM LOCATED IN A LABOR SURPLUS AREA
AND THAT IT INTENDED TO MANUFACTURE THE ITEM ON WHICH IT BID. ACE METAL
ALSO CONTENDS THAT THE OMISSIONS IN ITS TELEGRAPHIC BID WERE MINOR
INFORMALITIES OR IRREGULARITIES WHICH COULD BE WAIVED PURSUANT TO
SECTION 2-405 OF THE DEFENSE ACQUISITION REGULATION (DAR) (1976 ED.).
TELEGRAPHIC BIDS WERE PERMITTED BY SECTION L12 OF THE SOLICITATION,
WHICH PROVIDES AS FOLLOWS:
"(A) TELEGRAPHIC OFFER (INCLUDING WESTERN
UNION MAILGRAMS) MAY BE SUBMITTED IN RESPONSE
TO THIS SOLICITATION. TELEGRAPHIC OFFERS
MUST BE RECEIVED IN THIS OFFICE PRIOR TO THE
TIME SPECIFIED FOR RECEIPT OF OFFERS. SUCH
OFFERS MUST INCLUDE THE ITEM OR SUB-ITEMS,
QUANTITIES AND UNIT PRICES FOR WHICH THE
OFFER IS SUBMITTED AND THE TIME AND PLACE OF
DELIVERY; AND MUST CONTAIN ALL THE REPRESENTATIONS
AND OTHER INFORMATION REQUIRED BY THE
SOLICITATION TOGETHER WITH A STATEMENT THAT
THE OFFEROR AGREES TO ALL THE TERMS, CONDITIONS
AND THE PROVISIONS OF THE SOLICITATION. FAILURE
TO FURNISH, IN THE TELEGRAPHIC OFFER,
THE REPRESENTATIONS AND INFORMATION
REQUIRED BY THE SOLICITATION MAY NECESSITATE
REJECTION OF THE OFFER. SIGNED COPIES OF THE
SOLICITATION MUST BE FURNISHED IN CONFIRMATION
OF THE TELEGRAPHIC OFFER WITHIN 10 DAYS
OF THE SOLICITATION OPENING/CLOSING DATE."
SECTION L12(B) OF THE SOLICITATION REQUIRED THE BIDDER TO STATE
WHETHER IT WAS OR WAS NOT A SMALL BUSINESS AND TO INDICATE THE PLACE OF
PERFORMANCE. WE HAVE HELD THAT INFORMATION CONCERNING THE PLACE OF
PERFORMANCE IS NOT FOR THE PURPOSE OF ASSESSING THE RESPONSIVENESS OF A
BID, BUT TO DETERMINE THE BIDDER'S ELIGIBILITY FOR THE LABOR SURPLUS
AREA EVALUATION PREFERENCE. SOUTH JERSEY CLOTHING CO.; CATANIA CLOTHING
CORP., B-204531, B-204531.2, FEBRUARY 4, 1982, 82-1 CPD 88. THEREFORE,
EVEN THOUGH THE PLACE OF PERFORMANCE WAS OMITTED FROM ACE'S BID, THE BID
WAS NOT RENDERED NONRESPONSIVE BECAUSE OF THIS OMISSION. FURTHERMORE,
WE ARE ADVISED THAT EVEN WITHOUT THE LABOR SURPLUS AREA PREFERENCE, ACE
METAL IS THE LOW BIDDER.
MOREOVER, UNDER DAR SEC. 2-405(II), FAILURE TO MAKE A REPRESENTATION
CONCERNING SIZE STATUS MAY BE WAIVED AS A MINOR INFORMALITY OR
IRREGULARITY. SEE SHIPCO GENERAL, INC., B-204259, AUGUST 20, 1981, 81-2
CPD 161. HOWEVER, IT HAS BEEN HELD BY THIS OFFICE THAT A BID ON A TOTAL
SMALL BUSINESS SET-ASIDE WHICH, AS IN THE PRESENT CASE, FAILS TO
INDICATE THE INTENTION OF THE BIDDER TO FURNISH PRODUCTS MANUFACTURED OR
PRODUCED BY SMALL BUSINESS CONCERNS MUST BE REJECTED AS NONRESPONSIVE.
SEE MIL-PAC, INC., B-181711, OCTOBER 8, 1974, 74-2 CPD 196. THE FORMAL
BID COULD NOT BE USED TO CURE THE DEFICIENCY IN ACE METAL'S TELEGRAPHIC
BID AND A NONRESPONSIVE BID CANNOT BE MADE RESPONSIVE AFTER BID OPENING.
SEE PRESTEX, INC., B-195251.2, DECEMBER 17, 1979, 79-2 CPD 411.
ACCORDINGLY, THE REJECTION OF ACE METAL'S BID WAS PROPER.
SINCE IT IS CLEAR FROM THE PROTESTER'S INITIAL SUBMISSION THAT ITS
PROTEST IS WITHOUT MERIT, WE HAVE REACHED OUR DECISION WITHOUT OBTAINING
AN AGENCY REPORT ON THE MATTER. SEE INTROL CORPORATION, B-206012,
FEBRUARY 24, 1982, 82-1 CPD 164.
THE PROTEST IS SUMMARILY DENIED.
B-210259, SEP 2, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE DOUBT EXISTS CONCERNING THE DATE THE
PROTESTER BECAME AWARE OF THE BASIS OF PROTEST, GAO RESOLVES DOUBT
IN FAVOR OF THE PROTESTER.
2. PROTEST AGAINST AMBIGUITY IN RFP,
ALLEGED AS THE RESULT OF AN AWARD, IS TIMELY FILED WHEN FILED 10
WORKING DAYS AFTER AWARD UNDER SEEMINGLY UNAMBIGUOUS RFP.
3. PROTESTER'S ALLEGATION THAT RFP IS
AMBIGUOUS IS WITHOUT MERIT BECAUSE RFP IS NOT SUBJECT TO TWO
REASONABLE INTERPRETATIONS.
4. WHERE PROTESTER DISAGREES WITH PROCURING
AGENCY'S TECHNICAL EVALUATION OF SUCCESSFUL PROPOSAL VIS-A-VIS ITS
PROPOSAL WITHOUT PRODUCING SUFFICIENT EVIDENCE TO ESTABLISH
EVALUATION WAS UNREASONABLE, PROTESTER HAS FAILED TO AFFIRMATIVELY
PROVE ITS CASE.
5. ALLEGATION OF PREJUDICIAL MOTIVES OR
DISCRIMINATION AGAINST PROTESTER IS NOT SUPPORTED WHERE BASED ON
INFERENCE OR SUPPOSITION.
WEARDCO CONSTRUCTION CORP.:
WEARDCO CONSTRUCTION CORPORATION (WEARDCO) PROTESTS THE AWARD OF A
CONTRACT TO ACTUS CORPORATION (ACTUS) FOR 200 MANUFACTURED/
FACTORY-BUILT HOUSING UNITS AT FORT IRWIN, CALIFORNIA, UNDER REQUEST FOR
PROPOSAL (RFP) NO. DACA05-82-R-0090, ISSUED BY THE UNITED STATES ARMY
CORPS OF ENGINEERS (ARMY). WEARDCO ALLEGES THE AWARD TO ACTUS WAS
IMPROPER BECAUSE THE ACTUS PROPOSAL FAILS TO CONFORM TO THE REQUIREMENTS
OF THE RFP.
WE DENY THE PROTEST.
THE FOLLOWING PROVISIONS OF THE RFP ARE RELEVANT TO THE PROTEST.
PARAGRAPH 1.2 OF THE RFP STATES:
"SITE PLANNING. THIS PROJECT CONSISTS
OF 200 MANUFACTURED/FACTORY BUILT UNITS ON
APPROXIMATELY 70 ACRES OF LAND. IMAGINATIVE
SITE DESIGN IS ENCOURAGED. HOWEVER, THE SITE
BOUNDARIES AND PROJECT COMPOSITION AND THUS
THE GROSS DENSITY ARE FIXED."
THE 70 ACRES PRESCRIBED FOR DEVELOPMENT CONSIST OF TWO PARCELS - ONE
PARCEL IS 55.4 ACRES AND THE OTHER IS 14.6 ACRES.
SECTION F.I.(A) OF THE TECHNICAL EVALUATION MANUAL (FOR USE BY THE
EVALUATION TEAM ONLY), WHICH ALSO DISCUSSES DENSITY, STATES:
"THE PROJECT DENSITY IN HOUSING UNITS
PER GROSS ACRE IS PRE-ESTABLISHED BY THE
PROJECT SCOPE AND COMPOSITION (NUMBER OF
UNITS AND NUMBER OF BEDROOMS) IN RELATION TO
TOTAL ACREAGE PRESCRIBED FOR DEVELOPMENT."
IN ADDITION TO THE ABOVE REQUIREMENTS, PARAGRAPH 1.1.3.2 STATES:
"ALL UTILITIES EXCEPT THE ELECTRICAL
DISTRIBUTION SYSTEMS SHALL BE EXTENDED ALONG
THE COLLECTOR ROAD A."
WHEN THE PROTEST WAS INITIALLY FILED, WEARDCO COMPLAINED THAT THE
ACTUS PROPOSAL SHOULD HAVE BEEN REJECTED BECAUSE IT ONLY DEVELOPS 55.4
ACRES AND DOES NOT EXTEND UTILITIES ALONG THE ENTIRE LENGTH OF COLLECTOR
ROAD "A." WEARDCO ALSO STATED THAT ITS PROPOSAL OFFERING A SINGLE FAMILY
HOUSING UNIT DESIGN WAS SUPERIOR TO THE MULTIFAMILY, STACKED DESIGN
OFFERED IN THE ACTUS PROPOSAL. ON FEBRUARY 1 AND FEBRUARY 9, 1983,
WEARDCO SUPPLEMENTED THE PROTEST. WEARDCO ALLEGED THAT THE PROPOSAL
VIOLATES THE MANDATORY CIRCULATION FOR HABITABLE ROOMS, THE EXTERIOR
WALLS AND INTERIOR INSULATION FIRE RATING, THE SITE GRADING AND DRAINAGE
REQUIREMENTS, CEILING HEIGHT AND BEDROOM DESIGN REQUIREMENTS. FINALLY,
IN COMMENTS TO THE ARMY'S REPORT, WEARDCO CONTENDS THAT IF OFFERORS WERE
NOT REQUIRED TO DEVELOP 70 ACRES, THEN THE RFP WAS AMBIGUOUS, WHICH
RESULTED IN OFFERORS HAVING COMPETED ON AN UNEQUAL BASIS.
THE ARMY'S RESPONSE IS THAT THE RFP NEITHER REQUIRES THE DEVELOPMENT
OF THE TOTAL 70 ACRES NOR REQUIRES OFFERORS TO EXTEND UTILITIES ALONG
THE ENTIRE LENGTH OF COLLECTOR ROAD "A"; THEREFORE, THE ACTUS PROPOSAL
REASONABLY CONFORMS TO THE RFP. THE ARMY CONTENDS THAT THE RELATIVE
MERITS OF THE ACTUS PROPOSAL VIS-A-VIS THE WEARDCO PROPOSAL ARE
TECHNICAL JUDGMENTS OF THE EVALUATION TEAM, WHICH OUR OFFICE WILL NOT
DISTURB, UNLESS THE PROTESTER CAN CLEARLY DEMONSTRATE THE JUDGMENT WAS
ARBITRARY OR IN VIOLATION OF PROCUREMENT LAWS AND REGULATIONS (CITING
BLURTON BANKS & ASSOCIATES, INC., B-205865, AUGUST 10, 1982, 82-2 CPD
121). THE ARMY ARGUES THE WEARDCO PROTEST FAILS TO DEMONSTRATE THAT THE
TECHNICAL EVALUATION WAS UNREASONABLE. ON THE ISSUES FILED AFTER THE
ORIGINAL PROTEST, INCLUDING THE ALLEGED AMBIGUITY, THE ARMY CONTENDS
WEARDCO IS UNTIMELY.
IN CONNECTION WITH THE TIMELINESS ISSUE, THE ARMY STATES WEARDCO WAS
FURNISHED AN ENGINEERING REPORT WHICH DENIED ITS PROTEST ALLEGATIONS TO
THE ARMY ON JANUARY 11, AND WEARDCO MET WITH AGENCY OFFICIALS TO RESOLVE
THE PROTEST ON JANUARY 17. THE ARMY CONTENDS THE LAST DATE FOR FILING
ADDITIONAL PROTEST GROUNDS SHOULD HAVE BEEN JANUARY 31. MOREOVER, THE
ARMY BELIEVES THE AMBIGUITY ALLEGATION SHOULD HAVE BEEN FILED PRIOR TO
THE CLOSING DATE FOR THE RECEIPT OF PROPOSALS. 4 C.F.R. SEC.
21.2(B)(1) AND (2) (1983). WEARDCO, HOWEVER, RESPONDS THAT THE ISSUES
ARE SUBSTANTIALLY RELATED TO THE ORIGINAL PROTEST GROUNDS AND WERE
TIMELY FILED. WEARDCO STATES THE PROTEST GROUNDS WERE DISCOVERED AFTER
THE JANUARY 17 MEETING, FROM INFORMATION THE AGENCY FURNISHED ON JANUARY
20 AND FEBRUARY 3.
WE RESOLVE DOUBT SURROUNDING THE TIMELINESS OF A PROTEST IN FAVOR OF
THE PROTESTER. KUNERT ELECTRIC, B-204439, JUNE 8, 1982, 82-1 CPD 551.
BASED ON OUR EXAMINATION OF THE ENGINEERING REPORT AND THE RECORD OF THE
JANUARY 17 MEETING, WE CANNOT CONCLUSIVELY FIND THAT WEARDCO BECAME
AWARE OF THE ADDITIONAL PROTEST GROUNDS BEFORE JANUARY 17. AS TO THE
ALLEGED AMBIGUITY, THE GIST OF THE ARGUMENT WAS FILED IN THE ORIGINAL
PROTEST. WE HAVE FOUND THAT WHERE AN AMBIGUITY IS ALLEGED AS THE RESULT
OF AN AWARD UNDER SEEMINGLY UNAMBIGUOUS REQUIREMENTS, A PROTESTER'S
PROTEST FILED 10 DAYS AFTER THE AWARD IS TIMELY. SEE HONEYWELL, INC.,
B-199024, AUGUST 21, 1981, 80-2 CPD 137. WE THEREFORE WILL EXAMINE THE
MERITS OF THE PROTEST.
THE DETERMINATION OF THE RELATIVE MERITS OR TECHNICAL ACCEPTABILITY
OF PROPOSALS, PARTICULARLY WITH RESPECT TO TECHNICAL CONSIDERATIONS, IS
PRIMARILY A MATTER OF ADMINISTRATIVE DISCRETION. BLURTON BANKS &
ASSOCIATES, INC., SUPRA. OUR FUNCTION IS NOT TO EVALUATE PROPOSALS ANEW
AND MAKE A DETERMINATION OF THE RELATIVE TECHNICAL MERITS. THAT SINCE
IT MUST BEAR THE BURDEN OF ANY DIFFICULTIES RESULTING FROM A DEFECTIVE
EVALUATION. IN LIGHT OF THIS, WE HAVE HELD THAT PROCURING OFFICIALS
ENJOY A REASONABLE DEGREE OF DISCRETION IN EVALUATING PROPOSALS, WHICH
WE WILL NOT DISTURB UNLESS SHOWN TO BE ARBITRARY OR IN VIOLATION OF
PROCUREMENT LAWS AND REGULATIONS. THE PROTESTER'S MERE DISAGREEMENT
WITH THE EVALUATION DOES NOT IN ITSELF RENDER THE EVALUATION
UNREASONABLE. DYNALECTRON CORPORATION, B-199741, JULY 31, 1981, 81-2
CPD 70.
WEARDCO CONTENDS THAT INTERPRETING THE SITE PLANNING PROVISION TO
REQUIRE DEVELOPMENT OF ALL OF THE 70 ACRES IS CONSISTENT WITH THE ARMY'S
PRIOR INTERPRETATION OF A SOLICITATION FOR TURNKEY HOUSING CURRENTLY
UNDER CONSTRUCTION AT FORT IRWIN AND THAT OTHER MILITARY DEPARTMENTS
ALSO INTERPRET TURNKEY HOUSING PROJECT SOLICITATIONS IN THE SAME MANNER.
IN WEARDCO'S VIEW, A FIXED GROSS DENSITY REQUIRES A PROJECT DENSITY OF
2.86 UNITS/ACRES - 200 UNITS DIVIDED BY 70 ACRES. WEARDCO CONTENDS THAT
IN LIGHT OF THE PRIOR HISTORY OF TURNKEY PROJECTS, IT JUSTIFIABLY
CONSTRUED THE SITE PLANNING PROVISION TO REQUIRE DEVELOPING THE ENTIRE
70 ACRES. WEARDCO ASSERTS THAT ITS BELIEF WAS REINFORCED WHEN THE ARMY
DID NOTHING IN RESPONSE TO ITS LETTER DATED NOVEMBER 15, 1982, WHICH
INDICATED IT BELIEVED THE RFP PROHIBITED PARTIAL SITE DEVELOPMENT.
THEREFORE, WEARDCO ARGUES THAT THE ARMY'S ACCEPTANCE OF THE ACTUS
PROPOSAL WITHOUT AMENDING THE RFP, DESPITE THE FACT THAT IT FAILED TO
PROVIDE FOR DEVELOPMENT OF 70 ACRES AND TO EXTEND UTILITIES ALONG THE
ENTIRE LENGTH OF COLLECTOR ROAD "A," WAS IMPROPER.
WE DISAGREE. AN AMBIGUITY EXISTS WHEN PROVISIONS OF A SOLICITATION
ARE SUBJECT TO TWO REASONABLE INTERPRETATIONS. THE INTERPRETATION
WEARDCO ALLEGES WAS REASONABLE IS BASED ON OTHER PROJECTS. WE FIND THIS
ARGUMENT UNPERSUASIVE. WHILE THE RELEVANT PROVISION OF THE RFP STATES
THAT "THE SITE BOUNDARIES AND PROJECT COMPOSITION AND THUS THE GROSS
DENSITY ARE FIXED," GROSS DENSITY IS NOT DEFINED OR STATED IN TERMS OF
UNITS PER ACRE AS THE PROTESTER INTERPRETED IT. THE ONLY PRECISE FIGURES
STATED IN THIS PROVISION ARE THE ACRES (70) AND THE UNITS (200). WHILE
THE LANGUAGE COULD HAVE BEEN CLEARER AS TO THE MEANING OF GROSS DENSITY,
WE DO NOT BELIEVE IT REASONABLY CAN BE READ AS REQUIRING A PRECISE
DENSITY FIGURE OF 2.86 UNITS PER ACRE RATHER THAN THE 3.63 DENSITY
RESULTING FROM THE AWARDEE'S PLAN. THIS IS ESPECIALLY TRUE SINCE TOT
LOTS, OPEN SPACES, AND RECREATION AREAS WERE REQUIRED IN ADDITION TO
HOUSING UNITS. A FIXED DENSITY OF 2.86, NOT STATED IN THE RFP, BUT
WHICH WEARDCO ARRIVED AT BY DIVIDING THE NUMBER OF ACRES BY THE 200
UNITS, WOULD EMASCULATE THE OTHER PROVISIONS IN THE RFP THAT ENCOURAGE
CREATIVE DESIGN, PERMIT SEVERAL DIFFERENT HOUSING UNIT DESIGNS AND
ENCOURAGE PRESERVING THE NATURAL SETTING OF THE SITES. WE THEREFORE
CONCLUDE THAT OFFERORS COMPETED ON AN EQUAL BASIS BECAUSE THERE IS
NOTHING UNREASONABLE ABOUT THE ARMY'S CONCLUSION THAT THE ACTUS PROPOSAL
CONFORMS TO THE SITE PLANNING REQUIREMENT. SEE JVAN, INC., B-202357,
AUGUST 28, 1981, 81-2 CPD 184.
EVEN IF WE ASSUME THAT A NOVEMBER 15 LETTER FROM WEARDCO PUT THE ARMY
ON NOTICE THAT WEARDCO WAS INTERPRETING THE SITE PLANNING PROVISION TO
PROHIBIT PARTIAL SITE DEVELOPMENT, THE ARMY DID NOT ACT IMPROPERLY IN
NOT POINTING OUT THE ERRONEOUS INTERPRETATION WHICH ALLEGEDLY CAUSED
WEARDCO TO PRICE ITS PROPOSAL HIGHER. WE HAVE HELD THAT WHERE THE
MEANING OF THE PROPOSAL IS CLEAR AND THE PROPOSAL CONTAINS A WEAKNESS
WHICH IS THE RESULT OF THE PROPOSER'S OWN LACK OF COMPETENCE OR
INVENTIVENESS, THE CONTRACTING OFFICER IS NOT REQUIRED TO POINT OUT SUCH
A WEAKNESS. PIONEER CONTRACT SERVICE, INC., B-197245, FEBRUARY 19, 1981,
81-1 CPD 107.
WITH RESPECT TO THE UTILITIES ISSUE, WEARDCO ALLEGES IT SOUGHT TO
CLARIFY WHETHER UTILITIES COULD BE EXTENDED THROUGH THE PROJECT SITE
LIKE ACTUS PROPOSED, BUT AGENCY OFFICIALS INFORMED WEARDCO THAT THE
EXTENSION OF UTILITIES ALONG THE ENTIRE LENGTH OF COLLECTOR ROAD "A" WAS
A MANDATORY REQUIREMENT. THEREFORE, WEARDCO ARGUES THAT THIS IS ANOTHER
EXAMPLE OF UNEQUAL TREATMENT. THE ARMY, HOWEVER, QUESTIONS WHETHER THE
STATEMENTS WERE EVEN MADE BECAUSE IT INTERPRETS THE RFP TO ONLY REQUIRE
THAT UTILITIES BE EXTENDED ALONG COLLECTOR ROAD "A" PAST THE PROPOSED
SCHOOL SITE. ON THIS POINT, WE AGREE WITH THE PROTESTER, THE UTILITIES
REQUIREMENT IS CONFUSING. NEVERTHELESS, WE NOTE THE ARMY HAS INCLUDED
COPIES OF THE PROJECT DRAWINGS THAT WERE FURNISHED WITH THE RFP, WHICH
SUPPORT THE ARMY'S INTERPRETATION. FURTHER, THE ARMY ESTIMATES WEARDCO
COULD HAVE SAVED APPROXIMATELY $20,000 TO $30,000 BY RUNNING UTILITIES
THROUGH THE SITE BUT WOULD HAVE NEEDED TO DECREASE THE PROPOSAL BY
$1,250,000 TO HAVE EVEN TIED THE COST/POINT SCORE OF THE ACTUS PROPOSAL.
GIVEN THESE FACTORS, WE FIND THAT WEARDCO WAS NOT PREJUDICED SINCE IT
IS REASONABLE TO ASSUME THAT RUNNING THE UTILITIES THROUGH THE SITE
WOULD NOT HAVE IMPROVED WEARDCO'S COMPETITIVE STANDING. SEE
HSA/MULTICHEM, B-202421, AUGUST 11, 1981, 81-2 CPD 118.
ON THE REMAINING ISSUES, WE FIND WEARDCO HAS FAILED TO DEMONSTRATE
THAT THE EVALUATION OF THE ACTUS PROPOSAL WAS UNREASONABLE. THE
QUESTION OF WHETHER ACTUS' PROPOSED STORM AND DRAINAGE SYSTEM IS
PROPERLY COORDINATED WITH THE SURROUNDING PROPERTIES IS A DISCRETIONARY
DECISION FOR THE EVALUATION TEAM. THE FACT THAT WEARDCO DISAGREES WITH
THE EVALUATION TEAM'S DECISION IN THIS REGARD DOES NOT RENDER IT
UNREASONABLE. MOREOVER, OUR EXAMINATION OF THE ACTUS PROPOSAL REVEALS
THAT IT CONFORMS TO ALL THE MATERIAL DIMENSIONS SPECIFIED IN THE RFP.
WE FIND NO SUPPORT FOR THE ALLEGATIONS THAT THE CEILING HEIGHT
REQUIREMENT WAS VIOLATED OR THAT THE BEDROOMS WILL NOT ACCOMMODATE TWIN
BEDS. AS TO THE CIRCULATION REQUIREMENT, THE PROPOSAL REASONABLY
CONFORMS TO THE RFP.
WE NOTE, AS THE ARMY POINTS OUT, THAT IN THE TURNKEY CONCEPT OF
PROCUREMENT, THE GOVERNMENT DOES NOT PROVIDE COMPREHENSIVE DESIGN
SPECIFICATIONS, BUT RATHER RELIES ON THE OFFERORS TO USE THEIR
INVENTIVENESS IN DESIGNING BUILDINGS TO MEET CERTAIN STATED
REQUIREMENTS. JOSEPH LEGAT ARCHITECTS, B-187160, DECEMBER 13, 1977,
77-2 CPD 458. IN LIGHT OF THIS STANDARD, WE CANNOT CONCLUDE THAT THE
ARMY ACTED UNREASONABLY BY DETERMINING THAT THE ACTUS PROPOSAL WHICH
OFFERED A MULTIFAMILY, STACKED DESIGN ON 55.4 ACRES WAS SUPERIOR TO THE
WEARDCO PROPOSAL.
FINALLY, WEARDCO SUBMITS A CONGRESSIONAL REPORT, WHICH DISCUSSES
MANUFACTURED/FACTORY BUILT HOUSING AT FORT IRWIN, IN AN EFFORT TO
DEMONSTRATE THAT THE PROCURING OFFICIALS DISCRIMINATED AGAINST ITS
SINGLE FAMILY, MANUFACTURED HOUSING PROPOSAL. WHILE THIS REPORT
INDICATES THAT PAST PROCUREMENTS OF HOUSING AT FORT IRWIN HAD FAVORED
FACTORY-BUILT HOUSING OVER THE MANUFACTURED-TYPE PRODUCED BY WEARDCO,
THERE IS NOTHING IN THE REPORT THAT INDICATES ANY DISCRIMINATION IN THE
EVALUATION OF WEARDCO'S PROPOSAL. UNFAIR OR PREJUDICIAL MOTIVES WILL
NOT BE ATTRIBUTED TO PROCUREMENT OFFICIALS ON THE BASIS OF INFERENCE OR
SUPPOSITION. WHERE THE WRITTEN RECORD FAILS TO DEMONSTRATE BIAS, THE
PROTESTER'S ALLEGATIONS ARE PROPERLY TO BE REGARDED AS MERE SPECULATION.
SPERRY RAND CORPORATION, 56 COMP.GEN. 312, 317 (1977), 77-1 CPD 77.
ACCORDINGLY, THE PROTEST IS DENIED.
B-210258, APR 15, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
AGENCY CORRECTLY REJECTED BID AS NONRESPONSIVE WHERE BIDDER FAILED TO
ACKNOWLEDGE RECEIPT OF AN AMENDMENT INCORPORATING WAGE RATE
DETERMINATION AND WHERE RECORD FAILS TO SHOW THAT BIDDER IS LEGALLY
OBLIGATED TO PAY WAGES NOT LESS THAN THOSE PROVIDED FOR IN THE MINIMUM
WAGE RATE DETERMINATION. THE FACT THAT THE BIDDER MAY NOT HAVE RECEIVED
THE AMENDMENT IS IRRELEVANT UNLESS THE FAILURE TO RECEIVE THE BID
RESULTED FROM A DELIBERATE ATTEMPT BY THE CONTRACTING AGENCY TO EXCLUDE
THE FIRM FROM THE COMPETITION.
A-1 JERSEY MAYFLOWER:
A-1 JERSEY MAYFLOWER (A-1) PROTESTS THE REJECTION OF ITS BID AS
NONRESPONSIVE UNDER INVITATION FOR BIDS (IFB) NO. DABT35-82-B-0148,
ISSUED BY THE ARMY FOR THE PACKING, CRATING, STORAGE AND MOVEMENT OF
HOUSEHOLD GOODS. THE ARMY REJECTED THE BID BECAUSE A-1 FAILED TO
ACKNOWLEDGE AN AMENDMENT INCORPORATING A WAGE RATE DETERMINATION. A-1
ARGUES THAT IT SHOULD BE GIVEN AN OPPORTUNITY TO CURE THE DEFECT SINCE
THE AMENDMENT WOULD HAVE NO EFFECT ON ITS BID PRICE. FURTHER, A-1
CONTENDS IT DID NOT RECEIVE THE AMENDMENT.
WE DENY THE PROTEST.
A BIDDER'S FAILURE TO ACKNOWLEDGE A MATERIAL AMENDMENT TO AN IFB
GENERALLY RENDERS THE BID NONRESPONSIVE. PORTER CONTRACTING COMPANY, 55
COMP.GEN. 615 (1976), 76-1 CPD 2. WHILE WE HAVE RECENTLY HELD THAT A
BIDDER'S FAILURE TO ACKNOWLEDGE AN AMENDMENT INCORPORATING A WAGE RATE
DETERMINATION MAY BE CURED WHERE THE BIDDER IS REQUIRED BY UNION
CONTRACT TO PAY WAGES IN EXCESS OF THE RATES INCLUDED IN THE WAGE RATE
DETERMINATION AND WHERE THERE WOULD BE NO PREJUDICIAL EFFECT ON
COMPETITION, THERE IS NOTHING IN THE RECORD WHICH INDICATES THAT A-1 IS
LEGALLY REQUIRED TO PAY WAGES NOT LESS THAN THOSE PROVIDED FOR IN THE
MINIMUM WAGE RATE DETERMINATION. BRUTOCO ENGINEERING & CONSTRUCTION,
INC., 62 COMP.GEN. (B-209098, JANUARY 4, 1983), 83-1 CPD 9. UNDER
THESE CIRCUMSTANCES, THE ARMY ACTED PROPERLY IN REJECTING A-1'S BID AS
NONRESPONSIVE.
FURTHERMORE, WE NOTE THAT IT IS THE BIDDER THAT BEARS THE RISK OF
NONRECEIPT OF A SOLICITATION AMENDMENT. THE CONTRACTING AGENCY
DISCHARGES ITS LEGAL RESPONSIBILITY WHEN IT ISSUES AND DISPATCHES AN
AMENDMENT IN SUFFICIENT TIME TO PERMIT ALL BIDDERS TO CONSIDER THE
AMENDMENT IN FORMULATING THEIR BIDS. ROCKFORD ACROMATIC PRODUCTS
COMPANY, B-208437, AUGUST 17, 1982, 82-2 CPD 143. CONSEQUENTLY, THE
FACT THAT A-1 MAY NOT HAVE RECEIVED THE AMENDMENT IS NOT RELEVANT UNLESS
THE FAILURE RESULTS FROM A CONSCIOUS OR DELIBERATE EFFORT BY CONTRACTING
OFFICIALS TO EXCLUDE A-1 FROM COMPETITION. 3B BUILDING MAINTENANCE CO.,
B-205257, OCTOBER 28, 1981, 81-2 CPD 364. SINCE A-1 DOES NOT SUGGEST
THAT IT DID NOT RECEIVE THE AMENDMENT BECAUSE OF A DELIBERATE ATTEMPT TO
EXCLUDE IT FROM CONSIDERATION FOR AWARD, THIS PROTEST GROUND IS WITHOUT
MERIT.
THE PROTEST IS DENIED.
B-210256, MAR 28, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST BY POTENTIAL OFFEROR AGAINST $300 PRICE CEILING FOR SEATING
TO BE PROCURED BY THE GENERAL SERVICES ADMINISTRATION UNDER
MULTIPLE-AWARD SOLICITATION FOR INCLUSION ON THE FEDERAL SUPPLY SCHEDULE
IS WITHOUT MERIT SINCE DETERMINATION OF WHAT WILL SATISFY GOVERNMENT'S
NEEDS IS PRIMARILY WITHIN THE DISCRETION OF PROCURING OFFICIALS AND GAO
WILL NOT INTERPOSE ITS JUDGMENT FOR THAT OF THE CONTRACTING AGENCY WHERE
IT IS NOT SHOWN THAT AGENCY'S JUDGMENT WAS ERRONEOUS AND THAT AWARD
UNDER SOLICITATION WILL UNDULY RESTRICT COMPETITION.
KNOLL INTERNATIONAL:
KNOLL INTERNATIONAL (KNOLL) PROTESTS THE $300 PER SEATING UNIT
MAXIMUM DOLLAR CEILING FOR ITEM NO. 496-1 (MULTIPURPOSE SEATING) IMPOSED
BY THE GENERAL SERVICES ADMINISTRATION (GSA) UNDER MULTIPLE-AWARD
SOLICITATION NO. FNPS-S2-1346-N-8-23-82.
THE PROTEST IS DENIED.
THE ABOVE SOLICITATION, COVERING AN INDEFINITE-QUANTITY CONTRACT FOR
MISCELLANEOUS SEATING, WAS ISSUED BY GSA'S NATIONAL FURNITURE CENTER
(PRESENTLY THE FURNITURE COMMODITY CENTER) ON JULY 23, 1982. AMENDMENT
NO. 1 TO THE SOLICITATION WAS ISSUED, CORRECTING MINOR DEFICIENCIES.
AMENDMENT NO. 2, ISSUED ON SEPTEMBER 23, 1982, DELETED CERTAIN ITEMS AND
LIMITED THE NET PRICES FOR ITEMS NOS. 496-1 (MULTI-PURPOSE SEATING) AND
496-5 (CONFERENCE SEATING) TO $200. ORIGINALLY, A $500 PRICE LIMITATION
WAS IMPOSED WITH RESPECT TO ITEM NO. 496-1. AFTER RECEIVING COMMENTS
AND DISCUSSING THE PRICE LIMITATION WITH INDUSTRY REPRESENTATIVES AND
AGENCY USERS, GSA DECIDED TO RAISE THE ACCEPTABLE PRICE LIMIT FOR ITEMS
NOS. 496-1 AND 496-5 TO $300. AMENDMENT NO. 2 WAS CANCELED IN ITS
ENTIRETY.
BY LETTER OF NOVEMBER 24, 1982, KNOLL REQUESTED THAT THE $300 PRICE
LIMIT ON ITEM NO. 496-1 EXCLUDE THE "SINGLE PASSENGER LOUNGE UNIT." GSA
REFUSED TO GRANT KNOLL'S REQUEST. KNOLL, BY LETTER OF DECEMBER 21,
1982, LODGED A PROTEST WITH OUR OFFICE.
KNOLL STATES THAT IT VIEWS THE $300 PRICE LIMIT FOR ITEM NO. 496-5,
WHICH COVERS TRAINING AND CONFERENCE ROOM SEATING, AS REASONABLE AND
ACCEPTABLE. HOWEVER, KNOLL CONTENDS THAT THE $300 PRICE LIMIT FOR ITEM
NO. 496-1 IS UNREASONABLE SINCE THE USUAL PRICE FOR MULTIPURPOSE SEATING
IS APPROXIMATELY TWICE THE PRICE FOR TRAINING AND CONFERENCE ROOM
SEATING. KNOLL CONTENDS THAT THE PRICE LIMIT ON ITEM NO. 496-1 PLACES
AN UNNECESSARY BURDEN ON MANUFACTURERS, SUCH AS ITSELF, BY DENYING THEM
THE OPPORTUNITY OF HAVING A COMPLETE LINE OF SEATING ON THE
MULTIPLE-AWARD SCHEDULE. KNOLL ALSO ARGUES THAT AN EXTRA BURDEN IS
PLACED ON THE AGENCY USER WHO DESIRES TO PURCHASE A LOUNGE CHAIR, NOT ON
THE SCHEDULE BECAUSE OF THE PRICE LIMITATION, TO MATCH THE BALANCE OF
THE FURNITURE PURCHASED FROM THE SCHEDULE. IN SUCH A SITUATION, THE
AGENCY MUST, PURSUANT TO SECTION 101-26.100-2 OF THE FEDERAL PROPERTY
MANAGEMENT REGULATIONS, SEEK A WAIVER FROM GSA TO PURCHASE THE LOUNGE
CHAIR.
THE SOLICITATION CLOSED JANUARY 6, 1983, AND 68 BIDS WERE RECEIVED
FOR ITEM NO. 496-1. ACCORDING TO GSA, THERE WERE A WIDE RANGE OF ITEMS
AVAILABLE WITHIN THE $300 PRICE LIMIT.
WE HAVE HELD THAT THE DETERMINATION OF WHAT WILL SATISFY THE
GOVENMENT'S NEEDS IS PRIMARILY WITHIN THE DISCRETION OF THE PROCURING
OFFICIALS. WE WILL NOT INTERPOSE OUR JUDGMENT FOR THAT OF THE
CONTRACTING AGENCY UNLESS THE PROTESTER SHOWS THAT THE AGENCY'S JUDGMENT
IS IN ERROR AND THAT A CONTRACT AWARDED ON THE BASIS OF SUCH
REQUIREMENTS WOULD BE IN VIOLATION OF LAW BY UNDULY RESTRICTING
COMPETITION. SEE CHRYSLER CORPORATION, B-206943, SEPTEMBER 24, 1982,
82-2 CPD 271, AND ESSEX ELECTRO ENGINEERINGS, INC., B-191116, OCTOBER 2,
1978, 78-2 CPD 247. WE CONCUR WITH GSA'S VIEW THAT ITS DETERMINATION TO
ACCEPT ONLY THOSE COMMERCIAL PRODUCTS UNDER ITEM NO. 496-1 WHICH DO NOT
EXCEED $300 IN PRICE IS CLEARLY NOT UNREASONABLE. THIS DETERMINATION
WAS MADE AFTER CONSULTATION WITH REPRESENTATIVES OF THE INDUSTRY AND
USER AGENCIES. MOREOVER, THE RECORD INDICATES THAT THERE WAS MORE THAN
ADEQUATE COMPETITION. ALTHOUGH KNOLL WOULD LIKE TO HAVE THE PRICE
LIMITATION RAISED, THUS INCREASING COMPETITION, THE RECORD INDICATES
THAT GSA'S NEEDS WILL BE MET WITH THE $300 LIMITATION, AND WHILE KNOLL
MAY NOT AGREE WITH GSA CONCERNING SUCH NEEDS, SUCH DIFFERENCE OF OPINION
IS NOT SUFFICIENT TO UPSET GSA'S DETERMINATION THAT ITS NEEDS WILL BE
MET BY RESTRICTING OFFERS UNDER ITEM NO. 496-1 TO THOSE PRICED $300 OR
LESS. SEE INTEGRATED FOREST MANAGEMENT, INC., B-204106, B-204382,
JANUARY 4, 1982, 82-1 CPD 6, AND CASES CITED.
KNOLL'S PROTEST IS DENIED.
B-210254, JAN 19, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL REVIEW SMALL BUSINESS ADMINISTRATION COMPLIANCE WITH ITS
STANDARD OPERATING PROCEDURES GOVERNING AWARD OF 8(A) SUBCONTRACTS ONLY
WHEN A SHOWING OF BAD FAITH OR FRAUD ON THE PART OF GOVERNMENT
PROCUREMENT OFFICIALS HAS BEEN MADE. PROTEST DISMISSED.
BLOOMINGTON CRUSHED STONE, INC.:
BLOOMINGTON CRUSHED STONE, INC. (BLOOMINGTON), PROTESTS THE AWARD OF
A CONTRACT BY THE NAVAL WEAPONS SUPPORT CENTER TO THE SMALL BUSINESS
ADMINISTRATION (SBA) AND THE AWARD OR PROPOSED AWARD TO MEDINA
ENTERPRISES, INC. (MEDINA), UNDER SECTION 8(A) OF THE SMALL BUSINESS
ACT. 15 U.S.C. SEC. 637(A) (1976), AS AMENDED BY PUB.L. NO. 95-507,
OCTOBER 24, 1978, 92 STAT. 1757. THE CONTRACT IS AN INDEFINITE QUANTITY
TYPE CONTRACT FOR SEVERAL TYPES OF CRUSHED STONE.
BLOOMINGTON ARGUES THAT THE SBA DID NOT FOLLOW ITS PROCEDURES IN
DESIGNATING MEDINA AN ECONOMICALLY DISADVANTAGED SMALL BUSINESS CONCERN.
IN THIS CIRCUMSTANCE, BLOOMINGTON SUBMITS THAT THE NAVY HAS VIOLATED
THE POLICY OF THE DEPARTMENT OF DEFENSE, WHICH CONTEMPLATES THAT ONLY
ECONOMICALLY DISADVANTAGED CONCERNS WILL BE PERMITTED TO COMPETE UNDER
THE 8(A) PROGRAM.
BLOOMINGTON'S PROTEST IS DISMISSED.
OUR REVIEW OF SBA ACTION UNDER THE 8(A) PROGRAM IS LIMITED SINCE THE
SBA IS AFFORDED BROAD DISCRETION UNDER THE APPLICABLE STATUTE. SBA
DETERMINATIONS WILL NOT BE QUESTIONED ABSENT A SHOWING OF FRAUD OR BAD
FAITH ON THE PART OF GOVERNMENT PROCUREMENT OFFICIALS. ALSO, ALLEGATIONS
THAT THE SBA VIOLATED ITS STANDARD OPERATING PROCEDURES (SOP) GENERALLY
ARE NOT SUFFICIENT TO INVOKE OUR REVIEW, BECAUSE THE SOP IS "PRIMARILY
FOR THE INTERNAL GUIDANCE OF AGENCY EMPLOYEES IN PERFORMING THEIR
OFFICIAL FUNCTIONS" AND MAY BE WAIVED. JETS SERVICES, INC., B-199721,
MARCH 11, 1981, 81-2 CPD 300.
HERE, BLOOMINGTON HAS NOT ALLEGED, LET ALONE SHOWN, BAD FAITH OR
FRAUD ON THE PART OF GOVERNMENT PROCUREMENT OFFICIALS. THEREFORE, THE
PROTEST IS DISMISSED.
B-210252, MAR 8, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
GAO WILL NOT CONSIDER A PROTEST BY A POTENTIAL SUPPLIER TO AN
UNSUCCESSFUL OFFEROR SINCE THE PROTEST GENERALLY CHALLENGES THE
PROPRIETY OF THE PROCURING ACTIVITY'S REJECTION OF THE OFFEROR'S OFFER
AS NONRESPONSIVE AND, THUS, THE PROTESTER, WHO IS INELIGIBLE FOR AWARD,
IS NOT AN INTERESTED PARTY UNDER GAO BID PROTEST PROCEDURES.
ANDERSON HICKEY COMPANY:
ANDERSON HICKEY COMPANY (ANDERSON HICKEY) PROTESTS THE AWARD OF A
CONTRACT FOR SEVERAL ITEMS UNDER NEGOTIATED SOLICITATION NO.
FNP-AL-1373-N-9-20-82, ISSUED BY THE GENERAL SERVICES ADMINISTRATION
(GSA), FOR STEEL DESKS, CREDENZAS AND TABLES.
WE DISMISS THE PROTEST.
ANDERSON HICKEY WAS A POTENTIAL SUPPLIER FOR MAX BLAU & SONS, INC.
(BLAU), WHICH SUBMITTED THE OFFER IN RESPONSE TO THE SOLICITATION. ON
SEPTEMBER 20, 1982, SAMPLES SUPPLIED BY ANDERSON HICKEY WERE SUBMITTED
IN CONNECTION WITH THE BLAU OFFER. ON OCTOBER 15, 1982, GSA ISSUED AN
AMENDMENT IN CONNECTION WITH THE DESIGN OF THE DESKS. THE CLOSING DATE
FOR RECEIPT OF BEST AND FINAL OFFERS UNDER THE AMENDED SOLICITATION WAS
OCTOBER 27, 1982. BLAU SUBMITTED ITS OFFER, ACCOMPANIED BY ANDERSON
HICKEY SAMPLES, ON OCTOBER 27, 1982. BLAU WAS LOW ON ITEMS 9 AND 12-15.
HOWEVER, ITS OFFER WAS REJECTED BECAUSE THE SAMPLES DID NOT COMPLY WITH
THE SPECIFICATIONS. ON NOVEMBER 8, 1982, BLAU PROTESTED THE REJECTION.
ON DECEMBER 9, 1982, AWARDS FOR ALL THE ITEMS EXCEPT ONE WERE MADE TO
THREE OTHER FIRMS, AND GSA DENIED BLAU'S PROTEST.
ANDERSON HICKEY FILED A PROTEST WITH OUR OFFICE, CONTENDING THAT THE
OCTOBER 15 AMENDMENT WOULD LIMIT THE NUMBER OF COMPANIES THAT COULD
SUBMIT AN OFFER IN RESPONSE TO THE SOLICITATION. ANDERSON HICKEY ALSO
CONTENDS THAT THE AMENDMENT DID NOTHING MORE THAN ADD AN AESTHETIC
REQUIREMENT AND DID NOT AFFECT QUALITY OR PERFORMANCE STANDARDS. THE
PROTESTER CONCLUDES THAT REJECTION OF THE BLAU OFFER WAS IMPROPER.
UNDER OUR BID PROTEST PROCEDURES, A PARTY MUST BE "INTERESTED" BEFORE
WE WILL CONSIDER ITS PROTEST ALLEGATIONS. 4 C.F.R. SEC. 21.1(A) (1982).
WHETHER A PARTY IS SUFFICIENTLY INTERESTED DEPENDS UPON THE DEGREE TO
WHICH ITS INTEREST IN THE OUTCOME IS BOTH ESTABLISHED AND DIRECT. IN
GENERAL, WE WILL NOT CONSIDER A PARTY'S INTEREST TO BE SUFFICIENT WHERE
THAT PARTY WOULD NOT BE ELIGIBLE FOR AWARD, EVEN IF THE ISSUES RAISED
WERE RESOLVED IN ITS FAVOR. SEE INTERSCIENCE SYSTEMS, INC.; AMPERIF
CORPORATION, B-201943, B-202021, AUGUST 31, 1982, 82-2 CPD 187.
ANDERSON HICKEY'S PROTEST GENERALLY CHALLENGES THE PROPRIETY OF GSA'S
REJECTION OF BLAU'S OFFER. HOWEVER, ANDERSON HICKEY WAS NOT AN OFFEROR.
THEREFORE, IT WAS NOT ELIGIBLE FOR AWARD. ONLY BLAU WOULD HAVE A
DIRECT INTEREST IN THE OUTCOME OF THIS PROTEST, EVEN THOUGH BLAU'S OFFER
WAS REJECTED FOR OFFERING NONCONFORMING ITEMS SUPPLIED BY ANDERSON
HICKEY. MOREOVER, BLAU HAS NOT PROTESTED HERE. THUS, WE WILL NOT
CONSIDER ANDERSON HICKEY'S PROTEST BECAUSE THE FIRM IS NOT AN INTERESTED
PARTY. SEE RADIX II INCORPORATED, B-208557.2, SEPTEMBER 30, 1982, 82-2
CPD 302, AFFIRMED, B-208557.3, NOVEMBER 29, 1982, 82-2 CPD 484.
B-210251, JAN 24, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
BIDDER'S FAILURE TO MARK BID ENVELOPE WITH SOLICITATION NUMBER AND
THE DATE AND LOCAL TIME SET FOR BID OPENING AS REQUIRED BY INSTRUCTIONS
TO BIDDERS IS A MINOR DEFICIENCY WHICH CAN BE WAIVED UNDER DEFENSE
ACQUISITION REGULATION SEC. 2-405.
BOND TRANSFER AND STORAGE COMPANY:
BOND TRANSFER AND STORAGE COMPANY (BOND) PROTESTS ANY AWARD OF A
CONTRACT BY THE DEPARTMENT OF THE AIR FORCE TO WILLIAMS TRANSFER AND
STORAGE (WILLIAMS), THE APPARENT SUCCESSFUL BIDDER ON INVITATION FOR
BIDS (IFB) NO. F22608-82-B0042. BOND PROTESTS THAT WILLIAMS SUBMITTED
ITS BID IN AN UNMARKED ENVELOPE. BOND CONTENDS THAT THE INSTRUCTIONS TO
BIDDERS REQUIRED THAT THE ENVELOPE BE MARKED WITH THE SOLICITATION
NUMBER AND THE DATE AND LOCAL TIME SET FOR BID OPENING.
SINCE IT IS CLEAR FROM BOND'S SUBMISSION THAT THE PROTEST IS WITHOUT
LEGAL MERIT, WE ARE DECIDING THE MATTER WITHOUT REQUESTING A REPORT FROM
THE AIR FORCE. SEE SHIPCO GENERAL, INC., B-204259, AUGUST 20, 1981,
81-2 CPD 161.
BOND APPEARS TO BE PROTESTING THAT WILLIAMS' BID WAS NONRESPONSIVE.
THE TEST TO BE APPLIED IN DETERMINING THE "RESPONSIVENESS" OF A BID IS
WHETHER THE BID, AS SUBMITTED, IS AN OFFER TO PERFORM, WITHOUT
EXCEPTION, THE EXACT THING CALLED FOR IN THE INVITATION. AIRWEST
HELICOPTERS, INC., B-193277, JUNE 7, 1979, 79-1 CPD 402; EDW.
KOCHARIAN & COMPANY, INC., 58 COMP.GEN. 214, 217-18 (1979), 79-1 CPD 20.
IF THE TEST IS MET, THE BIDDER IS EFFECTIVELY BOUND TO PERFORM IN
ACCORDANCE WITH THE INVITATION REQUIREMENTS. ID. THE INSTRUCTIONS
APPARENTLY REQUIRED THAT BID ENVELOPES BE MARKED FOR THE PURPOSE OF
FACILITATING THE DELIVERY OF BIDS. WE FAIL TO SEE HOW WILLIAMS' FAILURE
TO SO MARK ITS BID ENVELOPE WOULD DEFINE OR LIMIT ITS OBLIGATION UNDER
THE INVITATION. THIS DEFICIENCY WAS AT BEST A MINOR INFORMALITY WHICH
COULD BE WAIVED UNDER DEFENSE ACQUISITION REGULATION SEC. 2-405 (DEFENSE
ACQUISITION CIRCULAR NO. 76-17, SEPTEMBER 1, 1978).
THE PROTEST IS SUMMARILY DENIED.
B-210246, FEB 1, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
PROTEST FILED IN GAO IS DISMISSED WHERE MATERIAL ISSUES PROTESTED ARE
BEFORE A COURT OF COMPETENT JURISDICTION AND THE COURT HAS NOT INDICATED
INTEREST IN A GAO DECISION.
CACI, INC.:
CACI, INC. (CACI), PROTESTS THE AWARD OF A CONTRACT BY THE DEPARTMENT
OF JUSTICE (DOJ) UNDER REQUEST FOR PROPOSALS (RFP) NO. JRATR-82-R-0056
TO ANY FIRM OTHER THAN CACI. CACI PROTESTS THAT DOJ'S EVALUATION OF
CACI'S PROPOSAL WAS IMPROPER BECAUSE THE DISCUSSIONS OF ITS TECHNICAL
PROPOSAL WERE INADEQUATE, DOJ'S EVALUATION INDICATED BIAS AGAINST AN
AWARD TO CACI, AND ONE DOJ EVALUATOR OF CACI'S PROPOSAL MAY NOT HAVE
BEEN IMPARTIAL.
WHILE THE PROTEST WAS PENDING WITH OUR OFFICE, CACI FILED SUIT
AGAINST THE GOVERNMENT IN THE UNITED STATES CLAIMS COURT IN WASHINGTON,
D. C. (CIVIL ACTION NO. 1-83C). WE HAVE BEEN ADVISED THAT THE BASES FOR
THE SUIT ARE SUBSTANTIALLY THE SAME AS THOSE PRESENTED TO OUR OFFICE IN
THE PROTEST.
IT IS THE POLICY OF OUR OFFICE NOT TO DECIDE PROTESTS WHERE THE
MATERIAL ISSUES ARE PENDING BEFORE A COURT OF COMPETENT JURISDICTION
UNLESS THE COURT REQUESTS, EXPECTS OR OTHERWISE EXPRESSES AN INTEREST IN
OUR DECISION. 4 C.F.R. SEC. 21.10 (1982). DOJ ADVISES THAT THE CLAIMS
COURT HAS NOT EXPRESSED ANY INTEREST IN OUR DECISION.
THEREFORE, WE DISMISS THE PROTEST. SPACE AGE ENGINEERING, INC.,
B-205594, JANUARY 18, 1982, 82-1 CPD 40.
B-210245 L/M, FEB 10, 1983, OFFICE OF GENERAL COUNSEL
HEADNOTES-UNAVAILABLE
PRECIS-UNAVAILABLE
MR. LARRY WILSON, DEPARTMENT OF ARGICULTURE:
THIS IS IN RESPONSE TO YOUR LETTER OF DECEMBER 16, 1982, REQUESTING
RELIEF OF CASHIER GERALDINE NYBURG FROM LIABILITY FOR THE LOSS OF
IMPREST FUNDS IN THE AMOUNT OF $626.21. MS. NYBURG IS AN IMPREST FUND
CASHIER FOR THE FOREST SERVICE AT THE CHUGACH NATIONAL FOREST IN
ANCHORAGE, ALASKA. FOR THE FOLLOWING REASONS, RELIEF IS GRANTED.
THE SHORTAGE IN THE IMPREST FUND RESULTED FROM A BREAK-IN AND THEFT
IN THE FOREST SUPERVISOR'S OFFICE IN ANCHORAGE, ALASKA. THE IMPREST
FUND WAS KEPT IN A SAFE MAINTAINED IN THAT OFFICE. SOMETIME BETWEEN THE
NIGHT OF JANUARY 2 AND THE MORNING OF JANUARY 3, 1980, THE LOCKED SAFE
WAS REMOVED FROM
WHEN THE BUDGET OFFICER DISCOVERED THE BURGLARY ON JANUARY 3, THE
FEDERAL PROTECTION OFFICE, ANCHORAGE POLICE DEPARTMENT, FBI, AND THE
FOREST SERVICE SPECIAL AGENT WERE NOTIFIED. THE ANCHORAGE POLICE
DEPARTMENT AND THE FEDERAL PROTECTION OFFICE MADE AN INVESTIGATION. THE
FBI WORKED WITH THE ANCHORAGE POLICE DEPARTMENT. THE INVESTIGATION
DEVELOPED NO INFORMATION THAT IDENTIFIED A CULPRIT OR IN ANY WAY
IMPLICATED MS. NYBURG. NONE OF THE CASH HAS BEEN RECOVERED.
WE HAVE AUTHORITY UNDER 31 U.S.C. SEC. 3527(A) (FORMERLY SECTION
82A-1, V AS RECODIFIED BY PUB.L. 97-258, SEPTEMBER 13, 1982) TO GRANT
RELIEF TO ACCOUNTABLE OFFICERS FOR THE PHYSICAL LOSS OF FUNDS UPON OUR
CONCURRENCE WITH THE AGENCY HEAD OR HIS DELEGATE THAT:
"(A) THE OFFICIAL OR AGENT WAS CARRYING OUT
OFFICIAL DUTIES WHEN THE LOSS OR DEFICIENCY
OCCURRED, OR THE LOSS OR DEFICIENCY OCCURRED
BECAUSE OF AN ACT OR FAILURE TO ACT BY A
SUBORDINATE OF THE OFFICIAL OR AGENT; AND
"(B) THE LOSS OR DEFICIENCY WAS NOT THE RESULT
OF FAULT OR NEGLIGENCE BY THE OFFICIAL OR
AGENT; ***" THE FOREST SERVICE HAS EXPRESSLY MADE THESE
DETERMINATIONS. WE AGREE THAT THE LOSS OCCURRED WHILE MS. NYBURG WAS
ACTING IN THE DISCHARGE OF HER OFFICIAL DUTIES. THE QUESTION OF RELIEF
THEREFORE TURNS UPON THE PRESENCE OR ABSENCE OF NEGLIGENCE.
THE PRESUMPTION THAT ACCOUNTABLE OFFICERS HAVE BEEN NEGLIGENT WHEN A
PHYSICAL LOSS OF FUNDS FOR WHICH THEY ARE RESPONSIBLE OCCURS CAN BE
REBUTTED BY CONVINCING EVIDENCE TO THE CONTRARY. 54 COMP.GEN. 112, 115
(1974). WE HAVE PREVIOUSLY GRANTED RELIEF TO ACCOUNTABLE OFFICERS WHERE
THE EVIDENCE IS CLEAR THAT A THEFT TOOK PLACE AND AN INVESTIGATION HAS
REVEALED NO CONNECTION BETWEEN THE ACCOUNTABLE OFFICER AND THE THEFT.
SEE, B-198789, JUNE 5, 1980 (SUSPECT CONFESSED TO THE THEFT OF IMPREST
FUNDS FROM A SAFE AT THE REXFORD RANGER STATION IN EUREKA, MONTANA) AND
B-189795; SEPTEMBER 23, 1977 (SAFE OPENED WITH AN ACETYLENE TORCH BY
BURGLARS AT THE FAIRBANKS, ALASKA OFFICE OF THE GEOLOGICAL SURVEY AT A
TIME WHEN THE OFFICE WAS CLOSED)9 WAS CLOSED).
IN THIS CASE, THERE IS CLEAR EVIDENCE THAT THE OFFICE WAS BROKEN INTO
AND THAT A THEFT TOOK PLACE. A LOCKED SAFE HAD BEEN FORCIBLY OPENED
DURING NON-BUSINESS HOURS. ARTICLES IN THE OFFICE HAD BEEN MOVED ABOUT
AND DRAWERS WERE PULLED OPEN. FOOTPRINTS WERE FOUND IN THE OFFICE AND
NEAR AN EXIST DOOR. THAT EXIT DOOR HAD PAPER PUSHED INTO THE STRIKER
PLATE HOLE. THE RECORD THUS SUPPORTS THE FINDING THAT THE LOSS OCCURRED
WITHOUT FAULT OR NEGLIGENCE ON THE PART OF THE ACCOUNTABLE OFFICER.
ACCORDINGLY, WE CONCUR WITH THE ADMINISTRATIVE RECOMMENDATION THAT
RELIEF BE GRANTED TO MS. NYBURG. THE LOSS MAY BE CHARGED TO FOREST
SERVICE APPROPRIATION 1221106, FOREST PROTECTION AND MANAGEMENT.
YOU ALSO REFER TO OUR DECISION IN B-195782, DECEMBER 13, 1979, IN
WHICH WE RELIEVED BETTY L. KEPPNER FROM LIABILITY FOR LOSS OF $513.53 IN
IMPREST FUNDS BECAUSE SHE TURNED OVER POSSESSION OF THE FUNDS TO AN
ALTERNATE IMPREST FUND CASHIER, MS. NYBURG, AND THEREFORE MS. NYBURG AND
NOT MS. KEPPNER WAS THE ACCOUNTABLE OFFICER WHEN THE LOSS OCCURRED.
HOWEVER, YOUR PREDECESSOR DID NOT REQUEST RELIEF FOR MS. NYBURG AT THAT
TIME. YOU ARE NOW MAKING THAT REQUEST.
IN THAT MATTER, THE IMPREST FUNDS WERE STORED IN A LOCKABLE GUN
CABINET WHICH WAS DETERMINED AT THE TIME TO BE THE SAFEST AND MOST
SECURE EQUIPMENT AVAILABLE IN MS. NYBURG'S OFFICE. THE CABINET WAS
BROKEN INTO AND $513.53 IN CASH WAS STOLEN DURING THE NIGHT OF MARCH 27,
1978. AN FBI AND POLICE INVESTIGATION DEVELOPED NO INFORMATION
IMPLICATING MS. NYBURG, AND YOU HAVE DETERMINED THAT THE LOSS OCCURRED
IN LINE WITH THE PERFORMANCE OF OFFICIAL DUTIES AND WITHOUT FAULT OR
NEGLIGENCE ON THE PART OF MS. NYBURG.
WHILE THE RECORD IS UNCLEAR WHY MS. NYBURG CHOSE TO PLACE THE IMPREST
FUNDS IN THE GUN CABINET RATHER THAN AN APPROVED SAFE, YOU INDICATE
THERE WAS AT THAT TIME NO BETTER LOCK-UP FACILITIES IN THE OFFICE THEN
THAT USED. ALTHOUGH THE $513.53 WAS ONLY SECURED IN THE LOCKING GUN
CABINET, THE RECORD INDICATES MS. NYBURG USED DUE CARE TO ENSURE THAT
THE IMPREST FUNDS WERE SECURED WITHIN THE LIMITED MEANS AVAILABLE TO
HER. UNDER THE CIRCUMSTANCES, WE AGREE WITH THE ADMINISTRATIVE
DETERMINATION AND WE GRANT RELIEF TO MS. NYBURG. SEE B-198836, JUNE 26,
1980; AND B-189795, SEPTEMBER 23, 1977. THE LOSS MAY BE CHARGED TO THE
APPROPRIATION AVAILABLE FOR THE EXPENSE OF THE DISBURSING FUNCTION,
PURSUANT TO 31 U.S.C. SEC. 352F.
B-210243, APR 22, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. THE DEPARTMENT OF LABOR'S CLAIMS TO WITHHELD FUNDS ON BEHALF OF
WORKERS UNDERPAID BY A CONTRACTOR IN VIOLATION OF THE SERVICE CONTRACT
ACT AND THE CONTRACT WORK HOURS AND SAFETY STANDARDS ACT (CWHSSA), AND
TO LIQUIDATED DAMAGES FOR VIOLATION OF THE CWHSSA, HAVE PRIORITY OVER AN
INTERNAL REVENUE SERVICE LIEN FOR UNPAID TAXES.
2. THE DEPARTMENT OF LABOR'S CLAIM TO WITHHELD FUNDS ON BEHALF OF
WORKERS UNDERPAID BY A GOVERNMENT CONTRACTOR HAS PRIORITY OVER THE
GOVERNMENT'S CLAIM FOR AS YET UNDETERMINED LIQUIDATED DAMAGES STEMMING
FROM THE CONTRACTOR'S VIOLATION OF THE CONTRACT WORK HOURS AND SAFETY
STANDARDS ACT.
3. AN IRS TAX LIEN ON FUNDS WITHHELD FROM A CONTRACTOR HAS PRIORITY
OVER A STATE LEVY OF ATTACHMENT WHERE THE TAX LIEN WAS FILED FIRST.
4. THE GOVERNMENT MAY NOT BE DEPRIVED OF ITS RIGHT TO A PROMPT
PAYMENT DISCOUNT WHERE THE DELAY IN MAKING THE PAYMENT IS CAUSED BY THE
CONTRACTOR. FURTHER, AN AGENCY'S CLAIM TO A PROMPT PAYMENT DISCOUNT ON
FUNDS WITHHELD FROM A CONTRACTOR HOW HAS NOT SUBMITTED INVOICES TAKES
PRIORITY OVER CLAIMS RESULTING FROM WAGE UNDERPAYMENTS AND OVER AN
INTERNAL REVENUE SERVICE TAX LIEN.
ALASKA SECURITY AGENCY, LTD.:
THIS IS IN RESPONSE TO A REQUEST FROM A CERTIFYING OFFICER AT THE
FEDERAL AVIATION ADMINISTRATION (FAA) FOR A DECISION ABOUT THE PROPER
DISPOSITION OF FUNDS OTHERWISE DUE THE ALASKA SECURITY AGENCY, LTD.
(ASA) UNDER CONTRACT NO. 04-82-C-10028 FOR SECURITY GUARD SERVICES FROM
NOVEMBER 1981 TO NOVEMBER 1982. THE FAA HAS WITHHELD PAYMENT FOR WORK
PERFORMED DURING AUGUST AND SEPTEMBER 1982 BECAUSE THE AGENCY NEVER
RECEIVED INVOICES FOR THOSE MONTHS AND BECAUSE OF COMPETING CLAIMS TO
THE FUNDS WITHHELD.
THE FOLLOWING PARTIES ARE COMPETING FOR THE $15,423.42 IN QUESTION:
1. THE DEPARTMENT OF LABOR (DOL) REQUESTED ON OCTOBER
14, 1982, THAT THE FAA WITHHOLD $11,279.81
FROM CONTRACT FUNDS FOR DISTRIBUTION TO ASA
EMPLOYEES AS A RESULT OF LABOR STIPULATION VIOLATIONS
WHICH RESULTED IN WAGE UNDERPAYMENTS TO THE
EMPLOYEES IN THAT AMOUNT.
2. THE INTERNAL REVENUE SERVICE (IRS), PURSUANT
TO A NOTICE OF LEVY DATED AUGUST 31, 1982,
CLAIMS $63,590.69 FOR ASA'S UNPAID TAXES.
3. THE DOL INTENDS TO CLAIM LIQUIDATED DAMAGES
RESULTING FROM THE LABOR STIPULATION VIOLATIONS;
HOWEVER, IT HAS NOT AS YET DETERMINED THE AMOUNT OF
LIQUIDATED DAMAGES OWED BY THE CONTRACTOR TO THE
GOVERNMENT FOR THE VIOLATIONS.
4. THE STATE OF ALASKA CLAIMS $2,296.93 PURSUANT
TO A NOVEMBER 1982 WRIT OF ATTACHMENT OBTAINED IN STATE COURT.
5. THE FAA ITSELF CLAIMS 9 PERCENT OF THE FINAL PAYMENT
DUE AS A PROMPT PAYMENT DISCOUNT BECAUSE IT NEVER
RECEIVED INVOICES FOR THE LAST 2 MONTHS OF CONTRACT
PERFORMANCE.
WE HOLD THAT, AFTER THE DEDUCTION OF THE FAA'S PROMPT PAYMENT
DISCOUNT, THE WITHHELD FUNDS SHOULD BE USED TO SATISFY THE UNDERPAID
WORKERS CLAIM AND THE LIQUIDATED DAMAGES CLAIM. THE REMAINING SUMS, IF
ANY, SHOULD BE FORWARDED TO THE IRS.
DOL AND IRS CLAIMS
THE SERVICE CONTRACT ACT OF 1965 (SCA), 41 U.S.C. SECS. 351-358
(1976), PROVIDES THAT, AS A GENERAL RULE, CONTRACTS IN EXCESS OF $2,500
ENTERED INTO BY THE UNITED STATES TO OBTAIN SERVICES THROUGH THE USE OF
SERVICE EMPLOYEES MUST CONTAIN CERTAIN LABOR STANDARDS STIPULATIONS,
INCLUDING THE PAYMENT OF SPECIFIED MINIMUM WAGES. SECTION 3(A) OF THE
SCA, 41 U.S.C. SEC. 352(A), PROVIDES THAT SO MUCH OF THE ACCRUED PAYMENT
DUE ON THE CONTRACT MAY BE WITHHELD AS IS NECESSARY TO COMPENSATE
UNDERPAID EMPLOYEES AND THAT, ON ORDER OF THE SECRETARY OF LABOR, ANY
COMPENSATION FOUND DUE SHALL BE PAID DIRECTLY TO THE EMPLOYEES FROM THE
WITHHELD MONIES. SEE ALSO 29 C.F.R. SEC. 4.187 (1982).
THE CONTRACT WORK HOURS AND SAFETY STANDARDS ACT (CWHSSA), 40 U.S.C.
SECS. 327-332 (1976), CONCERNS THE STANDARD WORKWEEK AND THE REQUIREMENT
FOR OVERTIME PAY. THE CONTRACTOR THAT VIOLATES THE CWHSSA IS LIABLE TO
THE EMPLOYEES FOR THE UNPAID WAGES AND TO THE GOVERNMENT FOR LIQUIDATED
DAMAGES. 40 U.S.C. SEC. 328(B)(2). THE STATUTE DIRECTS OUR OFFICE TO
PAY AGGRIEVED EMPLOYEES, FROM ANY AMOUNTS WITHHELD, FUNDS WHICH ARE
ADMINISTRATIVELY FOUND TO BE DUE THEM.
THE GENERAL RULE IS THAT THE FUNDS WITHHELD FOR UNDERPAID WORKERS
SHOULD BE APPLIED TO THE UNDERPAYMENTS BEFORE BEING USED TO SATISFY A
TAX DEBT OWED TO THE GOVERNMENT. SEE, E.G., M.C.&E. SERVICE & SUPPORT
CO., INC, B-189137, AUGUST 1, 1977, 77-2 CPD 65, REV'D. ON OTHER
GROUNDS, B-189137, MAY 19, 1978, 78-1 CPD 384; CASCADE REFORESTATION,
INC., 56 COMP.GEN. 499 (1977), 77-1 CPD 250. THE GOVERNMENT'S CLAIM FOR
LIQUIDATED DAMAGES UNDER THE CWHSSA ALSO HAS PRIORITY OVER AN IRS TAX
LIEN, SEE PACIFIC INSURANCE COMPANY, LTD., B-180333, APRIL 2, 1974, 74-1
CPD 163; B-161460, MAY 25, 1977, ALTHOUGH THE UNDERPAID WORKERS CLAIM
TAKES PRIORITY OVER THE LIQUIDATED DAMAGES CLAIM. 29 C.F.R. SEC.
5.14(D)(2) (1982).
THUS, DOL'S CLAIMS FOR THE UNDERPAID WORKERS AND FOR LIQUIDATED
DAMAGES ON BEHALF OF THE GOVERNMENT HAVE PRIORITY, IN THAT ORDER OVER
THE CLAIM BY THE IRS FOR UNPAID TAXES.
THE IRS AND STATE OF ALASKA CLAIMS
THE IRS CLAIM IS SUPERIOR TO THAT OF THE STATE OF ALASKA. IN
GENERAL, "AS AGAINST A RECORDED FEDERAL TAX LIEN, THE RELATIVE PRIORITY
OF A STATE LIEN IS DETERMINED BY THE RULE 'FIRST IN TIME IS FIRST IN
RIGHT,' ***." UNITED STATES V. EQUITABLE LIFE ASSURANCE SOCIETY, 384 U.
S. 323, 327 (1966). THE FEDERAL TAX LEVY IN THIS CASE, OF WHICH NOTICE
WAS SERVED ON THE FAA ON AUGUST 30, 1982, WAS FILED BEFORE THE STATE
LEVY, BY NOVEMBER 1982 WRIT OF ATTACHMENT. THEREFORE, THE IRS CLAIM HAS
PRIORITY.
THE PROMPT PAYMENT DISCOUNT
THE QUESTION REGARDING THE FAA'S CLAIM TO 9 PERCENT OF THE AMOUNT DUE
AS A PROMPT PAYMENT DISCOUNT INVOLVES TWO ISSUES: FIRST, WHETHER TAKING
ADVANTAGE OF THE DISCOUNT IS APPROPRIATE IN THIS CASE, AND SECOND, WHAT
PRIORITY, IN RELATION TO THE OTHER CLAIMS, IS TO BE ACCORDED THE FAA'S
CLAIM TO THE AMOUNT REPRESENTED BY THE DISCOUNT.
THE DISCOUNT CLAUSE OF THE CONTRACT IN QUESTION STATES THAT THE
PROMPT PAYMENT TIME PERIOD OF 20 DAYS IS TO BE DETERMINED FROM THE DATE
THE CORRECT INVOICE IS RECEIVED IN THE OFFICE SPECIFIED BY THE
GOVERNMENT. IN THIS CASE, THE FAA RECEIVED NO INVOICES FOR AUGUST OR
SEPTEMBER. THE FAA'S FAILURE TO PAY WAS ALSO OCCASIONED BY ITS RECEIPT
OF THE IRS AND DOL NOTICES.
THE GOVERNMENT MAY NOT BE DEPRIVED OF ITS RIGHT TO A PROMPT PAYMENT
DISCOUNT WHERE THE DELAY IN MAKING THE PAYMENT IS CAUSED BY THE
CONTRACTOR. PHILADELPHIA SCIENTIFIC CONTROLS INC., B-184351, JANUARY
27, 1976, 76-1 CPD 48. ASA'S FAILURE SUBMIT INVOICES, OR ALTERNATIVELY,
ITS FAILURE TO PAY WORKERS THE PROPER WAGE RATE IN VIOLATION OF THE SCA
AND THE CWHSSA, IN ADDITION TO ITS ACTIONS WHICH RESULTED IN THE IRS
LEVY AND STATE WRIT OF ATTACHMENT, ARE THE CAUSE OF THE GOVERNMENT'S
DELAY IN MAKING THE FINAL PAYMENT IN THIS CASE. SEE REQUEST FOR ADVANCE
DECISION FROM ARMY FINANCE AND ACCOUNTING OFFICE - RECONSIDERATION,
B-201328, OCTOBER 28, 1981, 81-2 CPD 353. THEREFORE, THE FAA IS
ENTITLED TO THE 9 PERCENT DISCOUNT.
MOREOVER, THE FAA'S CLAIM TO THE DISCOUNT IS SUPERIOR TO THOSE OF THE
OTHER PARTIES. THE REASON IS THAT THE WITHHELD FUNDS THAT REPRESENT THE
DISCOUNT BASICALLY ARE NOT FUNDS TO WHICH ASA IS ENTITLED UNDER THE
CONTRACT. SEE REQUEST FOR ADVANCE DECISION FROM ARMY FINANCE AND
ACCOUNTING OFFICE - RECONSIDERATION, SUPRA. THUS, THE FAA MAY TAKE THE
9 PERCENT DISCOUNT BEFORE PAYING THE OTHERWISE TOP PRIORITY CLAIM.
IN SUMMARY, THE ORDER OF PRIORITY TO BE ACCORDED TO THE COMPETING
CLAIMS IN THIS CASE IS AS FOLLOWS. THE FAA MAY FIRST DEDUCT THE 9
PERCENT DISCOUNT, AND THEN PAY AS MUCH OF THE WITHHELD FUNDS AS NEEDED
TO COMPENSATE THE UNDERPAID WORKERS AND TO SATISFY THE GOVERNMENT'S
LIQUIDATED DAMAGES CLAIM STEMMING FROM LABOR VIOLATIONS. ANY REMAINING
SUM SHOULD BE FORWARDED TO THE IRS TO SATISFY ITS CLAIM.
B-210239, MAY 31, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
CANCELLATION OF SOLICITATION WAS REASONABLE WHERE PROCURING ACTIVITY
WAS ADVISED THAT SERVICE BEING PROCURED, ORIGINALLY REQUIRED BY MARCH 1,
1984, WOULD NOT BE REQUIRED UNTIL JUNE 1, 1985, AND, AS A RESULT OF
DELAY, SERVICE REQUIREMENTS WOULD BE INCREASED AND OTHER CHANGES MAY
OCCUR IN THE INTERIM.
RCA AMERICAN COMMUNICATIONS, INC.:
RCA AMERICAN COMMUNICATIONS, INC. (RCA), PROTESTS THE CANCELLATION BY
THE DEFENSE COMMUNICATIONS AGENCY (DCA), DEFENSE COMMERCIAL
COMMUNICATIONS OFFICE (DECCO), OF DECCO SOLICITATION NO. DCA
200-82-R-0031.
THE PROTEST IS DENIED.
ON MAY 24, 1982, DECCO ISSUED THE ABOVE SOLICITATION FOR 18.974
MEGABIT SATELLITE SYNCHRONOUS DIGITAL DATA SERVICE. THE SERVICE WOULD
PROVIDE WIDEBAND DATA COMMUNICATIONS BETWEEN WHITE SANDS, NEW MEXICO,
OFFUTT AIR FORCE BASE, NEBRASKA, AND FT. BELVOIR, VIRGINIA. PROPOSALS
WERE DUE AT 2 P.M., AUGUST 20, 1982.
ONLY TWO PROPOSALS WERE RECEIVED - ONE FROM RCA AND THE OTHER FROM
AMERICAN SATELLITE COMPANY (AMSAT). HOWEVER, AMSAT'S PROPOSAL WAS
DETERMINED TO BE LATE. THUS, RCA'S PROPOSAL WAS THE ONLY PROPOSAL
CAPABLE OF BEING MADE ACCEPTABLE. SUBSEQUENTLY, AMSAT SUBMITTED AN
UNSOLICITED PROPOSAL FOR THE SAME SERVICE, WHICH WAS NEITHER ACCEPTED
NOR EVALUATED. IN THE MEANTIME, THE CONTRACTING OFFICER PROCEEDED WITH
THE PROCUREMENT AS IF IT WERE A SOLE-SOURCE PROCUREMENT. CERTIFIED COST
AND PRICING DATA WERE REQUESTED AND RECEIVED FROM RCA, AND THE DEFENSE
CONTRACT AUDIT AGENCY (DCAA) CONDUCTED AN AUDIT OF RCA'S OPERATIONS.
ORIGINALLY, SERVICE WAS REQUIRED BY MARCH 1, 1984; HOWEVER, DECCO
WAS ADVISED THAT THE SERVICE WOULD NOT BE REQUIRED UNTIL JUNE 1, 1985.
ALSO, ACCORDING TO THE CONTRACTING OFFICER, AFTER HAVING SEEN AMSAT'S
UNSOLICITED PROPOSAL PRICE, HE CONSIDERED RCA'S PRICE TO BE UNREASONABLY
SHOULD BE CANCELED; IT WAS CANCELED ON DECEMBER 2, 1982. IT IS DCA'S
POSITION THAT WITH THE NEW SERVICE DATE OF JUNE 1, 1985, IT IS
ANTICIPATED THAT THE SOLICITATION PROCESS WILL BEGIN BETWEEN JUNE 1983
AND JANUARY 1984 AND THAT MANY CHANGES COULD OCCUR BETWEEN NOW AND 1985.
ACCORDING TO DCA, IT ANTICIPATES ADDITIONAL SATELLITE REQUIREMENTS FROM
AT LEAST ONE OF THE LOCATIONS WITHIN THE NEXT YEAR. DCA STATES THAT, BY
INCLUDING THE ADDITIONAL REQUIREMENTS IN THE NEW PROCUREMENT, A LOWER
PRICE CAN BE OBTAINED.
RCA TAKES EXCEPTION TO DCA'S POSITION. RCA CONTENDS THAT THE CHANGE
IN THE SERVICE DATE IS OF INSUFFICIENT SUBSTANCE TO JUSTIFY CANCELLATION
OF THE SOLICITATION AND THAT VERY FEW CHANGES IN REQUIREMENTS COULD
OCCUR BETWEEN NOW AND THE TIME THE SOLICITATION PROCESS BEGINS, WHICH,
AT THE MOST, IS ONLY 10 MONTHS AWAY. ALSO, RCA ARGUES THAT THE MOST
LIKELY CHANGE IN PRICE WOULD BE UPWARD.
IN REGARD TO THE CONTRACTING OFFICER'S VIEW, BASED ON HAVING SEEN
AMSAT'S UNSOLICITED PROPOSAL PRICE, THAT RCA'S PRICE IS UNREASONABLY
HIGH, RCA STATES THAT THIS SORT OF ANALYSIS AND PROCEDURE MAKE A SHAM OF
THE GOVERNMENT'S COMPETITIVE BIDDING PROCESS SINCE AMSAT'S PROPOSAL WAS
ORIGINALLY, AND PROPERLY, REJECTED AS BEING UNTIMELY. RCA CONTENDS THAT
AMSAT'S UNSOLICITED PROPOSAL WAS A METHOD OF AVOIDING DCA'S REGULATIONS
AND NO PART OF THE SOLICITITATION SHOULD BE CONSIDERED BY DCA IN REVIEW
OF RCA'S PROPOSAL. RCA ALSO ARGUES THAT SINCE AMSAT'S PROPOSAL WAS
NEITHER ACCEPTED NOR EVALUATED, A RELIABLE COMPARISON COULD NOT BE MADE
BETWEEN THE TWO PROPOSALS SINCE DCA WOULD HAVE NO WAY OF KNOWING WHETHER
AMSAT'S PROPOSAL MET ITS REQUIREMENTS.
SECTION 1, PARAGRAPH 3, OF THE SOLICITATION TERMS AND CONDITIONS,
RESERVES TO THE GOVERNMENT THE RIGHT TO REJECT ANY OR ALL PROPOSALS. OF
COURSE, TO CANCEL A NEGOTIATED SOLICITATION, THE GOVERNMENT MUST HAVE A
REASONABLE BASIS FOR DOING SO. SEE MANAGEMENT SERVICES INCORPORATED,
B-197443, JUNE 6, 1980, 80-1 CPD 394. WE HAVE RECOGNIZED THAT THE
POTENTIAL FOR COST SAVINGS IS A LEGITMATE BASIS FOR CANCELING A
NEGOTIATED SOLICITATION. SEE SCIENCE INFORMATION SERVICES, INC.,
B-205899, JUNE 2, 1982, 82-1 CPD 520. IN LIGHT OF THE POTENTIAL SAVINGS
ANTICIPATED BY THE INCLUSION OF THE ADDITIONAL SERVICE REQUIREMENTS IN
THE NEW SOLICITATION AND THE POSSIBILITY OF OTHER CHANGES BETWEEN NOW
AND 1985, WE BELIEVE THAT THE CONTRACTING OFFICER HAD A REASONABLE BASIS
FOR CANCELING THE ABOVE SOLICITATION. IN VIEW THEREOF, IT IS NOT
NECESSARY TO ADDRESS THE CONTRACTING OFFICER'S DETERMINATION OF THE
UNREASONABLENESS OF RCA'S PRICE BASED ON AMSAT'S UNSOLICITED PROPOSAL.
FINALLY, RCA EXPRESSED CONCERN THAT ITS PROPOSAL PRICE HAD BEEN
EXPOSED TO ITS COMPETITORS. DCA STATES THAT IT HAS NO KNOWLEDGE OF SUCH
EXPOSURE AND THERE IS NO EVIDENCE OF RECORD TO INDICATE THAT RCA'S
PROPOSAL PRICES WERE EXPOSED TO ITS COMPETITORS.
ACCORDINGLY, WE DENY THE PROTEST.
B-210237, MAY 31, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. SINCE THE OFFER WAS TECHNICALLY UNACCEPTABLE VIS-A-VIS THE RFP,
FACT THAT IT WAS LOWEST IN PRICE, THAT OFFEROR WAS EXPERIENCED AND THAT
IT PROPOSED TO PERFORM IN A MANNER THAT MAY HAVE BEEN ACCEPTABLE UNDER A
PREVIOUS RFP IS IRRELEVANT.
2. ALTHOUGH ITEM FOR WHICH OFFEROR WAS REJECTED MAY REPRESENT ONLY A
SMALL PART OF THE CONTRACT, CONTRACTING AGENCY ACTED PROPERLY IN
ADHERING TO REQUIREMENT IN EVALUATION OF OFFERS, SINCE ITEM INVOLVES A
MATERIAL AND ESSENTIAL SERVICE.
JOHNS HOLDING CO.:
JOHNS HOLDING CO. (JHC) PROTESTS THE REJECTION OF ITS OFFER UNDER
REQUEST FOR PROPOSALS (RFP) 02-83 ISSUED BY THE OFFICE OF PERSONNEL
MANAGEMENT (OPM) FOR CREDIT DATA AND REPORTS.
JHC PROTESTS THE REJECTION OF ITS OFFER ON SEVERAL GROUNDS. JHC
CONTENDS THAT IT SHOULD HAVE RECEIVED THE AWARD BECAUSE IT WAS THE LOW,
EXPERIENCED OFFEROR AND HAD PROPOSED TO PERFORM IN THE MANNER IT
PERFORMED UNDER A PREVIOUS OPM CONTRACT (30-80) AND WHICH WAS ACCEPTABLE
UNDER ANOTHER RFP. JHC FURTHER CONTENDS THAT IT SHOULD NOT HAVE BEEN
REJECTED BECAUSE THE ITEM FOR WHICH IT WAS FOUND UNACCEPTABLE AMOUNTS TO
ONLY 5 PERCENT OF THE CONTRACT.
WE DENY THE PROTEST.
HERE THE RFP REQUIRED THAT OPM INVESTIGATORS BE ABLE TO WALK INTO ANY
CREDIT BUREAU IN THE UNITED STATES, PUERTO RICO AND THE VIRGIN ISLANDS
AND OBTAIN CREDIT REPORTS OVER-THE-COUNTER UPON PRESENTATION OF A FORM
TO BE SUPPLIED BY THE CONTRACTOR. HOWEVER, BOTH THE INITIAL OFFER AND
THE SUBSEQUENT BEST AND FINAL OFFER, WHICH WAS TO ADDRESS THE
OVER-THE-COUNTER REQUIREMENT, FAILED TO TOTALLY COMPLY WITH THE
REQUIREMENT. IN THAT REGARD, THE BEST AND FINAL OFFER INDICATED THAT
JHC WOULD FOLLOW THE PROCEDURE IT USED UNDER AWARD TO ARRANGE FOR
OVER-THE-COUNTER SERVICE TO BE PROVIDED TO OPM INVESTIGATORS. SINCE OPM
FOUND THAT UNDER THE PREVIOUS CONTRACT JHC WAS UNABLE TO PROVIDE
OVER-THE-COUNTER SERVICE WITH THAT PROCEDURE IN MORE THAN 200 CITES, OPM
CONSIDERED THE OFFER TO BE SOMETHING LESS THAN AN OFFER OF TOTAL
COMPLIANCE. IN THE CIRCUMSTANCES, WE FIND THAT OPM HAD A REASONABLE
BASIS TO CONCLUDE THAT THE JHC PROPOSAL WAS TECHNICALLY UNACCEPTABLE AND
TO REJECT IT.
SINCE THE OFFER WAS TECHNICALLY UNACCEPTABLE VIS-A-VIS THE RFP, THE
FACT THAT IT WAS THE LOWEST IN PRICE, THAT THE OFFEROR WAS EXPERIENCED
AND THAT IT PROPOSED TO PERFORM IN A MANNER THAT MAY HAVE BEEN
ACCEPTABLE UNDER A PREVIOUS RFP IS IRRELEVANT. MACRO SYSTEMS, INC., ET
AL., B-195990, AUGUST 19, 1980, 80-2 CPD 133.
FURTHER, ALTHOUGH THE ITEM FOR WHICH JHC WAS REJECTED MAY REPRESENT
ONLY A SMALL PART OF THE CONTRACT, OPM HAS INDICATED THAT IT INVOLVES A
SERVICE THAT IS MATERIAL AND ESSENTIAL TO THE NEEDS OF ITS FIELD
INVESTIGATORS AND JHC HAS NOT DENIED THAT. ACCORDINGLY, WE FIND THAT
OPM ACTED PROPERLY IN ADHERING TO THE REQUIREMENT IN THE EVALUATION OF
OFFERS. PHILIPS INFORMATION SYSTEMS, INC., B-208066, DECEMBER 6, 1982,
82-2 CPD 506.
B-210229, APR 4, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
COURT'S DISMISSAL WITH PREJUDICE OF A COMPLAINT PRESENTING THE SAME
ISSUES AS A PENDING PROTEST PRECLUDES GAO FROM CONSIDERING THE PROTEST
SINCE A DISMISSAL WITH PREJUDICE CONSTITUTES A FINAL ADJUDICATION ON THE
MERITS.
TIME OIL COMPANY, INC.:
TIME OIL COMPANY, INC. PROTESTS THE REJECTION OF ITS BID AND THE
AWARD OF CONTRACTS FOR THE SUPPLY AND DELIVERY OF PETROLEUM PRODUCTS
UNDER INVITATION FOR BIDS NO. 0037-AA-91-0-3-PF ISSUED BY THE DISTRICT
OF COLUMBIA. THE DISTRICT OF COLUMBIA REJECTED TIME'S BID BECAUSE AT
THE TIME OF BID OPENING THE FIRM WAS NOT CERTIFIED AS A MINORITY
BUSINESS ENTERPRISE BY THE D. C. MINORITY BUSINESS OPPORTUNITY
COMMISSION AS REQUIRED BY THE INVITATION. TIME CONTENDS THAT THE
COMMISSION FAILED TO CONSIDER ITS APPLICATION FOR CERTIFICATION IN A
TIMELY FASHION AND THAT, IN ANY EVENT, THE FIRM'S FAILURE TO BE
CERTIFIED AT THE TIME OF BID OPENING IS A MINOR INFORMALITY WHICH CAN BE
WAIVED.
WHILE THE PROTEST WAS PENDING BEFORE OUR OFFICE, TIME FILED SUIT ON
THE SAME ISSUES IN THE SUPERIOR COURT OF THE DISTRICT OF COLUMBIA, TIME
OIL COMPANY, INC. V. MARION BARRY, ET AL., CIVIL ACTION NO. 16007-82,
SEEKING DECLARATORY AND INJUNCTIVE RELIEF. BY ORDER DATED FEBRUARY 11,
1983, THE COURT DENIED TIME'S MOTION FOR DECLARATORY AND INJUNCTIVE
RELIEF AND DISMISSED TIME'S COMPLAINT WITH PREJUDICE.
THE DISMISSAL OF THIS COMPLAINT WITH PREJUDICE BY THE D. C. SUPERIOR
COURT CONSTITUTES A FINAL ADJUDICATION ON THE MERITS OF THIS MATTER,
BARRING FURTHER ACTION BY THIS OFFICE. SEE D.C.CT.R.ANN. 41(B); 4 C.
F. R. SEC. 21.10 (1982); INDIANA BELL TELEPHONE COMPANY, B-205291, MAY
18, 1982, 82-1 CPD 476; NATIONAL OFFICE MOVING COMPANY -
RECONSIDERATION, B-196282.2, MAY 2, 1980, 80-1 CPD 318.
THE PROTEST IS DISMISSED.
B-210227, MAY 23, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. PROTEST AFTER AWARD THAT PRICE RATHER THAN TECHNICAL FACTORS
SHOULD HAVE BEEN BASIS FOR AWARD IS UNTIMELY, SINCE REQUEST FOR
PROPOSALS STATES THAT TECHNICAL CONTENT OF PROPOSALS IS SIGNIFICANTLY
MORE IMPORTANT THAN PRICE.
2. PROTEST THAT AGENCY IMPROPERLY AWARDED POINTS FOR FEATURES
EXCEEDING MINIMUM REQUIREMENTS IS WITHOUT MERIT WHERE TECHNICAL FACTORS
ARE IMPORTANT PART OF COMPETITION AND HIGHER TECHNICAL EVALUATION SCORE
ACCORDED AWARDEE'S DATA PROCESSING SYSTEM AND BENEFICIARY/PROVIDER
RELATIONS PROGRAM REFLECTS NOTHING MORE THAN AGENCY'S REASONABLE
ASSESSMENT THAT AWARDEE'S SYSTEM OFFERED SUPERIOR ABILITY TO MEET
REQUIREMENTS IN REQUEST FOR PROPOSALS. OFFERORS ARE OR SHOULD BE ON
NOTICE THAT QUALITATIVE DISTINCTIONS WILL BE MADE WHEN TECHNICAL FACTORS
ARE PART OF COMPETITION.
3. IN CAMERA REVIEW OF SOURCE-SELECTION DOCUMENTS SHOWS EVALUATION
WAS FAIR AND REASONABLE AND CONSISTENT WITH EVALUATION CRITERIA IN
SOLICITATION.
4. PROTEST AGAINST PROPRIETY OF AGENCY'S COST EVALUATION IS DENIED
WHERE, BECAUSE OF PROTESTER'S LOW TECHNICAL SCORE, PROTESTER WOULD NOT
HAVE BEEN SELECTED FOR AWARD IN ANY CASE.
5. NO BASIS EXISTS TO PRECLUDE CONTRACT AWARD MERELY BECAUSE LOW
OFFER MAY BE BELOW COST.
6. PROTEST AGAINST TECHNICAL EVALUATION OF PROTESTER'S PROPOSAL IS
UNTIMELY WHERE PROTESTER DOES NOT CHALLENGE TECHNICAL EVALUATION OF
PROPOSAL IN INITIAL PROTEST AND DOES NOT DO SO UNTIL MORE THAN 10 DAYS
AFTER BEING ADVISED OF TECHNICAL DEFICIENCIES AT DEBRIEFING OR
SUBSEQUENT MEETING.
BLUE CROSS-BLUE SHIELD OF TENNESSEE (TENNESSEE) PROTESTS THE AWARD OF
A CONTRACT TO BLUE SHIELD OF CALIFORNIA (CALIFORNIA) BY THE OFFICE OF
CIVILIAN HEALTH AND MEDICAL PROGRAM OF THE UNIFORMED SERVICES (CHAMPUS)
UNDER REQUEST FOR PROPOSAL (RFP) NO. MDA906-82-R-0007.
THE CONTRACT CONSOLIDATES FROM THREE CONTRACTORS TO ONE FISCAL
INTERMEDIARY SERVICES (CLAIMS PROCESSING SERVICES) IN THE SOUTHEASTERN
REGION OF THE UNITED STATES CONSISTING OF ALABAMA, FLORIDA, GEORGIA,
MISSISSIPPI, TENNESSEE AND THE COMMONWEALTH OF PUERTO RICO. CHAMPUS
AWARDED TO CALIFORNIA, BECAUSE CALIFORNIA'S PROPOSAL, ALTHOUGH HIGHER
PRICED, WAS CONSIDERED THE BEST TECHNICAL PROPOSAL.
THE TENNESSEE BASIS OF PROTEST IS THAT CHAMPUS IMPROPERLY ACCEPTED
CALIFORNIA'S HIGHER PRICED PROPOSAL INSTEAD OF TENNESSEE'S LOWEST PRICED
PROPOSAL WHICH WAS TECHNICALLY ACCEPTABLE. TENNESSEE FURTHER ALLEGES
THAT THE AWARDEE WAS AWARDED POINTS, AND CHAMPUS IS PAYING A HIGHER
PRICE, FOR SYSTEM ENHANCEMENTS WHICH HAVE SPECULATIVE VALUE. TENNESSEE
ASSERTS ITS PAST, CURRENT AND FUTURE PERFORMANCE HAS, IS AND WILL
CONTINUE TO BE SUPERIOR TO THAT OF CALIFORNIA. TENNESSEE ALSO PROTESTS
CHAMPUS'S FAILURE TO CONSIDER UNDER TENNESSEE'S COST PROPOSAL A MEMBER
HOSPITAL DISCOUNT ALLEGEDLY AVAILABLE TO TENNESSEE OF $500,000 A YEAR
($1.5 MILLION FOR 3 YEARS). TENNESSEE ALSO ARGUES THAT CALIFORNIA HAS
OFFERED A BELOW-COST PRICE AND THAT CALIFORNIA CANNOT DELIVER THE
SERVICES AT THE PRICE OFFERED.
WE FIND TENNESSEE'S ALLEGATION TO BE EITHER WITHOUT MERIT OR
UNTIMELY.
INITIALLY, TENNESSEE'S ALLEGATION AFTER AWARD THAT THE EVALUATION
PROCESS SHOULD HAVE EMPHASIZED PRICE, NOT TECHNICAL, AND THAT AWARD
SHOULD HAVE BEEN ON THE BASIS OF PRICE IS AN UNTIMELY CHALLENGE TO THE
RFP'S AWARD CRITERIA. SEE INFORMATION NETWORK SYSTEMS, B-208009, MARCH
17, 1983, 83-1 CPD 272. THE RFP AWARD CRITERIA PROVIDED THAT "THE
DEGREE OF IMPORTANCE PLACED ON TECHNICAL CONTENT IS SIGNIFICANTLY
GREATER THAN THAT PLACED ON PRICE." OUR BID PROTEST PROCEDURES REQUIRE
THAT PROTESTS OF ALLEGED IMPROPRIETIES IN AN RFP WHICH ARE APPARENT
PRIOR TO THE CLOSING DATE FOR SUBMISSION OF INITIAL PROPOSALS BE FILED
PRIOR TO THAT DATE. 4 C.F.R. SEC. 21.2(B)(1) (1983).
REGARDING TENNESSEE'S ALLEGATION THAT CHAMPUS AWARDED TO THE MOST
ELABORATE PROPOSAL REGARDLESS OF COST AND THAT TENNESSEE WOULD HAVE
PERFORMED THE WORK AT A LOWER COST, WE CONSIDERED A SIMILAR CONTENTION
IN MUTUAL OF OMAHA INSURANCE COMPANY, B-203338.2, SEPTEMBER 24, 1982,
82-2 CPD 268. IN THAT DECISION, WE REJECTED THE CONTENTION OF A LOWER
RANKED TECHNICAL OFFEROR THAT CHAMPUS HAD IMPROPERLY AWARDED POINTS FOR
FEATURES EXCEEDING MINIMUM REQUIREMENTS. WE DETERMINED THAT, WHERE
TECHNICAL FACTORS ARE AN IMPORTANT PART OF THE COMPETITION AND THE
HIGHER TECHNICAL EVALUATION SCORE ACCORDED THE AWARDEE'S SYSTEM REFLECTS
NOTHING MORE THAN THE AGENCY'S REASONABLE ASSESSMENT THAT THE AWARDEE'S
OFFERED SYSTEM BEST MET THE RFP REQUIREMENTS, THE AWARD OF MORE POINTS
TO THE AWARDEE IS PROPER. WE STATED THAT OFFERORS ARE OR SHOULD BE ON
NOTICE THAT QUALITATIVE DISTINCTIONS WILL BE MADE WHEN TECHNICAL FACTORS
ARE PART OF THE COMPETITION. TENNESSEE'S POSITION THAT CHAMPUS SHOULD
NOT BE PERMITTED TO MAKE QUALITATIVE DISTINCTIONS WOULD DENY THE MEANS
TO DIFFERENTIATE AMONG PROPOSALS ON THE BASIS OF TECHNICAL MERIT.
AS IN MUTUAL OF OMAHA INSURANCE COMPANY, SUPRA, THE RECORD INDICATES
THAT THE HIGHER TECHNICAL RATING WHICH CHAMPUS ACCORDED CALIFORNIA'S
PROPOSED ADP SYSTEM AND BENEFICIARY/PROVIDER RELATIONS PROGRAM REFLECTED
NOTHING MORE THAN CHAMPUS'S REASONABLE ASSESSMENT THAT CALIFORNIA'S
SYSTEM OFFERED A SUPERIOR CAPACITY TO SATISFY CHAMPUS'S REQUIREMENTS.
HERE, IN CAMERA REVIEW OF THE SCORESHEETS AND SOURCE-SELECTION
DOCUMENTS SHOWS THAT THE TECHNICAL EVALUATION WAS FAIR AND REASONABLE
AND IN ACCORD WITH CRITERIA LISTED IN THE RFP. IN THIS REGARD, THE
RECORD SUPPORTS CHAMPUS'S ASSERTION THAT, CONTRARY TO TENNESSEE'S
SPECIFIC ALLEGATION, TENNESSEE RECEIVED MORE POINTS THAN CALIFORNIA
UNDER THE EXPERIENCE PERFORMANCE FACTOR, ALTHOUGH THIS DID NOT OFFSET
OTHER EVALUATED AREAS IN WHICH CALIFORNIA SCORED HIGHER.
TENNESSEE ALLEGES THAT CHAMPUS FAILED TO PROPERLY EVALUATE A DISCOUNT
OF APPROXIMATELY $500,000 A YEAR WHICH TENNESSEE OBTAINS FROM HOSPITALS
WITH WHICH IT HAS CONTRACTS AND WHICH WOULD BE PASSED ON TO THE
GOVERNMENT AS COST SAVINGS. TENNESSEE CONTENDS THAT THIS SAVINGS SHOULD
HAVE BEEN USED TO LOWER TENNESSEE'S OVERALL EVALUATED PRICE. CHAMPUS
ASSERTS IT ASSIGNED THE DISCOUNT SOME POINTS UNDER TECHNICAL, BUT
CONSIDERED THE ESTIMATED SAVINGS WERE NOT SUBSTANTIATED, AND DID NOT
CONSIDER THE DISCOUNT UNDER PRICE. THE ISSUE OF THE EVALUATION OF A
HOSPITAL DISCOUNT WAS RAISED IN A PRIOR PROTEST OF THE AWARD OF A
CHAMPUS FISCAL INTERMEDIARY SERVICES CONTRACT, PENNSYLVANIA BLUE SHIELD,
B-203338, MARCH 23, 1982, 82-1 CPD 272. AS IN THAT CASE, HERE, WE NEED
NOT RESOLVE THE ISSUE OF WHETHER THE DISCOUNT SHOULD HAVE BEEN APPLIED
TO PRICE.
WHERE, AS HERE, AN RFP PROVIDES THAT TECHNICAL FACTORS ARE OF
PARAMOUNT IMPORTANCE IN THE SELECTION DECISION, AN AGENCY HAS BROAD
DISCRETION TO SELECT THE BEST TECHNICAL PROPOSAL OVER A LOWER RANKED BUT
LOWER COST ONE. SEE, E.G., ALAN-CRAIG, INC., B-202432, SEPTEMBER 29,
1981, 81-2 CPD 263, AT P. 8; GENERAL EXHIBITS INC., 56 COMP.GEN. 882,
887 (1977), 77-2 CPD 101. AS NOTED ABOVE, CALIFORNIA'S PROPOSAL WAS
PROPERLY DETERMINED THE BEST TECHNICAL PROPOSAL AND, ALTHOUGH IT WAS
HIGHER PRICED THAN TENNESSEE'S, CHAMPUS AWARDED TO CALIFORNIA. CHAMPUS
HAS RESCORED THE TENNESSEE AND CALIFORNIA OFFERS AS IF THE DISCOUNT IN
ISSUE WERE CONSIDERED. BECAUSE OF CALIFORNIA'S TECHNICAL SUPERIORITY,
THAT FIRM STILL RECEIVES A HIGHER OVERALL SCORE THAN TENNESSEE. CHAMPUS
REPORTS THAT, EVEN IF THE DISCOUNT WERE CONSIDERED IN EVALUATING
TENNESSEE'S COST PROPOSAL, THE AGENCY SIMPLY WOULD NOT HAVE ACCEPTED
TENNESSEE'S LOWER SCORING TECHNICAL OFFER JUST TO SAVE LESS THAN 4.6
PERCENT OF CALIFORNIA'S EVALUATED PRICE OVER A 3-YEAR PERIOD.
CONSEQUENTLY, THE PROPRIETY OF CHAMPUS'S DECISION NOT TO CONSIDER THE
DISCOUNT IN THE COST EVALUATION NEED NOT BE RESOLVED SINCE IT DID NOT
AFFECT THE SELECTION DECISION. SEE PENNSYLVANIA BLUE SHIELD, SUPRA.
TENNESSEE ALSO CONTENDS THAT CALIFORNIA'S PRICE IS BELOW COST AND
THAT CALIFORNIA CANNOT PERFORM AT ITS OFFERED PRICE. THE CONTRACT IS A
FIXED-PRICE CONTRACT. CHAMPUS MADE A DETAILED PRICE EVALUATION. CHAMPUS
DETERMINED THAT CALIFORNIA'S PRICE WAS SUPPORTABLE AND FOUND NO EVIDENCE
OF A BUY-IN. HOWEVER, EVEN IF CALIFORNIA WILL HAVE A LOSS AT ITS
OFFERED PRICE, THE PRACTICE OF SUBMITTING A BELOW-COST OFFER IS NOT
ILLEGAL AND THE GOVERNMENT CANNOT WITHHOLD AN AWARD MERELY BECAUSE THE
LOW OFFER IS BELOW COST. SUN TEMPORARY SERVICES, B-210577, FEBRUARY 17,
1983, 83-1 CPD 167. WHETHER THE LOW OFFEROR CAN PERFORM THE CONTRACT AT
THE PRICE OFFERED IS A MATTER OF RESPONSIBILITY OF THE OFFEROR AND A
DETERMINATION THAT AN OFFEROR IS RESPONSIBLE IS A PREREQUISITE TO AN
AWARD. OUR OFFICE DOES NOT REVIEW PROTESTS CONCERNING AFFIRMATIVE
DETERMINATIONS OF RESPONSIBILITY ABSENT A SHOWING THAT THE CONTRACTING
OFFICER ACTED FRAUDULENTLY OR IN BAD FAITH OR THAT DEFINITIVE
RESPONSIBILITY CRITERIA IN THE SOLICITATION HAVE NOT BEEN MET. TEAMSTER
LOCAL NO. 270, B-208634, SEPTEMBER 15, 1982, 82-2 CPD 230. ACCORDINGLY,
WE DISMISS THIS ASPECT OF THE PROTEST.
FINALLY, IN ITS JANUARY 5, 1983, LETTER TO OUR OFFICE, TENNESSEE
FIRST ALLEGES THAT IT SHOULD HAVE RECEIVED MAXIMUM POINTS FOR THE
FOLLOWING CATEGORIES: BENEFICIARY SERVICES, INSTITUTIONAL PROVIDER RATE
REVIEW, AUTOMATION OF MENTAL ILLNESS REVIEWS, ADDITIONAL INFORMATION
REQUESTS, "APPEAL MESSAGE INCOMPLETE," AND SPLIT JURISDICTION CLAIMS
HANDLING. IN ITS INITIAL PROTEST TO OUR OFFICE, TENNESSEE DID NOT
ALLEGE THAT ITS TECHNICAL PROPOSAL WAS IMPROPERLY EVALUATED. RATHER,
TENNESSEE CHALLENGED THE EVALUATION CRITERIA AND THE FAILURE TO AWARD TO
TENNESSEE AS THE LOW COST OFFEROR, TO CONSIDER THE HOSPITAL DISCOUNT IN
ITS PRICE AND ITS SUPERIOR PERFORMANCE IN THIS TYPE OF WORK. IN FACT,
TENNESSEE RESERVED THE RIGHT TO SUPPLEMENT THE PROTEST AFTER A
DEBRIEFING. WE DO NOT FIND THE INITIAL PROTEST SUFFICIENT TO CONSTITUTE
A TIMELY PROTEST AGAINST THE SPECIFIC DEFICIENCIES IN THE FIRM'S
TECHNICAL PROPOSAL OF WHICH TENNESSEE WAS ADVISED AT THE DEBRIEFING AND
ANOTHER MEETING.
OUR BID PROTEST PROCEDURES REQUIRE THAT PROTESTS AGAINST OTHER THAN
ALLEGED DEFICIENCIES THAT ARE APPARENT FROM THE SOLICITATION ITSELF BE
FILED WITHIN 10 WORKING DAYS AFTER THE BASIS FOR PROTEST IS KNOWN OR
SHOULD HAVE BEEN KNOWN. 4 C.F.R. SEC. 21.1(B)(2) (1983). TENNESSEE WAS
ADVISED OF THE DEFICIENCIES IN ISSUE AT A NOVEMBER 4, 1982, DEBRIEFING
OR AT A MEETING ON NOVEMBER 23, 1982. THEREFORE, THE FIRM HAD 10
WORKING DAYS AFTER LEARNING OF THE DEFICIENCIES TO FILE A PROTEST.
PENNSYLVANIA BLUE SHIELD, SUPRA; LAMBDA CORPORATION, 54 COMP.GEN. 468
(1974), 74-2 CPD 312. THE LETTER OF JANUARY 5, 1983, IS NOT A FILING
WITHIN THIS TIME LIMIT.
OUR BID PROTEST PROCEDURES ARE DESIGNED TO GIVE PROTESTERS AND
INTERESTED PARTIES A FAIR OPPORTUNITY TO PRESENT THEIR CASES WITH ONLY
MINIMAL, IF ANY, DISRUPTION TO THE ORDERLY AND EXPEDITIOUS PROCESS OF
GOVERNMENT PROCUREMENT. SEE BIRD-JOHNSON COMPANY - REQUEST FOR
RECONSIDERATION, B-199445.3, OCTOBER 14, 1980, 80-2 CPD 275. THEY DO
NOT CONTEMPLATE A PIECEMEAL PRESENTATION OR DEVELOPMENT OF PROTEST
ISSUES. SEE RADIX II, INC., B-186999, FEBRUARY 8, 1977, 77-1 CPD 94.
WE BELIEVE THAT, WHERE A FIRM HAS BEEN DEBRIEFED SO THAT IT KNOWS OF THE
PRECISE REASONS BEHIND THE EVALUATION OF ITS TECHNICAL PROPOSAL, THE
PURPOSE OF OUR BID PROTEST PROCEDURES CAN BE SERVED ONLY IF THE FIRM'S
PROTEST REASONABLY INDICATES THAT IT IS BASED ON A DISPUTE WITH THE
DEBRIEFING INFORMATION.
IN KAPPA SYSTEMS, INC., 56 COMP.GEN. 675 (1977), 77-1 CPD 412, WE
STATED THAT WE GENERALLY WILL CONSIDER LATER-FILED MATERIALS AND/OR
ARGUMENTS WHICH MERELY PROVIDE FURTHER SUPPORT FOR AN ALREADY TIMELY
PROTEST. SEE ALSO MEMOREX CORPORATION, 61 COMP.GEN. 42 (1981), 81-2 CPD
334. HOWEVER, WE THINK TENNESSEE'S PROTEST AGAINST THE TECHNICAL
EVALUATION OF ITS PROPOSAL RAISES AN ENTIRELY NEW ISSUE. THE KAPPA
SYSTEMS RULE IS INTENDED TO AVOID A SITUATION IN WHICH A FIRM OTHERWISE
WOULD DELAY FILING A PROTEST UNTIL IT WAS CERTAIN THAT IT WAS IN A
POSITION TO DETAIL ALL OF THE POSSIBLE SEPARATE GROUNDS OF ITS PROTEST.
THAT SITUATION WOULD BE DETRIMENTAL TO THE BASIC UNDERLYING OBJECTIVE OF
OUR BID PROTEST PROCEDURES: TO ASSURE THAT PROTESTS AGAINST THE AWARD
OR PROPOSED AWARD OF CONTRACTS ARE MADE PROMPTLY.
THE RULE, HOWEVER, PRESUMES A TIMELY INITIAL PROTEST THAT MERELY
LACKS DETAIL. IT IS NOT DESIGNED TO PERMIT A PROTESTER TO TOLL OUR
FILING REQUIREMENTS BY RESERVING THE RIGHT, IN EFFECT, TO RAISE NEW
GROUNDS OF PROTEST SUBSEQUENTLY IF THE FIRM IS NOT SATISFIED WITH THE
CONTRACTING AGENCY'S RESPONSE TO ITS OTHERWISE TIMELY PROTEST.
PENNSYLVANIA BLUE SHIELD, SUPRA.
WE DISMISS THE PROTEST IN PART AND DENY IT IN PART.
FILE: B-210226
DATE: May 28, 1985
MATTER OF: Market Facts, Inc.
DIGEST:
PAYMENTS - QUANTUM MERUIT/VALEBANT BASIS - ABSENCE, ETC. OF CONTRACT
AUTHORITY TO PAY LACKING
GAO does not approve payment of a claim for extra compensation under
the changes clause of a contract performed for a defunct federal agency
where there is no written evidence that the alleged extra work performed
was authorized, and the contracting officer of the defunct agency
contends that such work was not authorized. Under the circumstances,
the claimant has not met its burden of proving entitlement to payment.
The General Services Administration (GSA) has submitted two claims
for expenses allegedly incurred by Market Facts, Inc. (MFI), and its
subcontractor, Peat, Marwick, Mitchell & Co. (Peat), in the performance
of constructive changes to contract No. PP9AC002 with the now defunct
President's Commission on Pension Policy (Commission). The Commission
terminated its activities on May 22, 1981, and GSA was then authorized,
pursuant to an agreement entered into under the Economy Act, 31 U.S.C.
Section 686 (1976), for administrative support services, to pay
outstanding invoices and to perform other ministerial tasks necessary
for the liquidation of the Commission's assets and liabilities.
The firm, fixed-price contract in question was for a study to
investigate the effect of Social Security, pension and other retirement
plans on savings behavior. MFI and its subcontractor, Peat, performed
phase I of the study, data collection, during the period of August 1979
through October 1980. Phase II of the study, data analysis, was
performed by another contractor.
On January 7, 1981, MFI requested final payment under the contract.
The contracting officer responded by letter dated January 13, 1981,
stating that final payment will be held pending a determination of the
Commission's expenses created as a result of MFI's contract deficiencies
(listed therein). A meeting was held, however, between representatives
of MFI and the Commission and an agreement was reached to release all
funds due to MFI. MFI's January 7, 1981, invoice ($68,870) was approved
for payment on May 1, 1981.
On the same date, MFI submitted a claim to the Commission for $40,700
based on additional work allegedly performed by Peat at the direction of
the Commission. On May 19, 1981, MFI submitted its second claim
($56,561, later reduced to $38,832) for additional work allegedly
performed by MFI at the Commission's direction. At the time that the
Commission terminated, however, no action had been taken on the claims.
The contracting officer for the Commission contends that MFI's claims
represent work that was not authorized to be performed. MFI contends
that extra work which Peat and MFI allegedly performed was authorized,
but has no written evidence of such authorization. However, on September
27, 1979, during the early part of contract performance, MFI was warned
by letter from the contracting officer concerning the requirement for
written contract modifications when changes occur which would affect
either price or delivery and was notified that any change made without
the approval of the contracting officer would cause MFI to be working
"at risk." The contracting officer made it clear that he had not
delegated his contracting authority. Cf. Centre Manufacturing Company,
Inc., 392 F.2d 229 (Ct. Cl. 1968) (contracting officer's technical
representative was delegated contractual authority).
There is a factual dispute as to whether MFI and Peat were authorized
to perform the changes which MFI alleges they performed. GAO considers
claims on the written record only, and the burden of proof is on the
claimant to establish the liability of the United States and the
claimant's right to payment. 4 C.F.R. Section 31.7 (1985). Where, as
here, the only evidence on an issue of fact is a claimant's statement
that conflicts with that of contracting officials, the claimant has not
carried its burden of proof. See Printer System Corporation, B-213978,
May 22, 1984, 84-1 C.P.D. Paragraph 546. MFI has not met its burden of
proving that the changes which it allegedly performed were properly
authorized by the contracting officer. Moreover, the record indicates
that the contracting officer did not delegate his authority to issue
change orders. Consequently, such work, if performed, was voluntary and
MFI and Peat are not entitled to extra compensation. See Space Services
of Georgia, Inc., Armed Services Board of Appeals No. 26,655, Nov. 29,
1982, reprinted in 83-1 B.C.A. Paragraph 16,189 (CCH 1983).
Comptroller General
of the United States
B-210223.4, B-210223.5, FEB 13, 1984
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE THE LOW BIDDER OFFERS A LESSER MONTHLY
PRICE FOR THE FIRST PROGRAM YEAR THAN FOR SUBSEQUENT YEARS IN A
MULTIYEAR PROCUREMENT, DESPITE A REQUIREMENT THAT THE UNIT PRICE
BE THE SAME FOR ALL YEARS, BUT THE LOW BID WOULD BE LOW EVEN IF
CONTRACT WERE TO BE TERMINATED AFTER THE FIRST OPERATIONAL MONTH,
AND NO PREJUDICE WOULD RESULT TO OTHER BIDDERS FROM ACCEPTANCE OF
THE LOW BID SINCE DIFFERENCE BETWEEN LOW BID AND SECOND LOW BID
INDICATES LOW BID WOULD HAVE BEEN LOW EVEN IF THE SECOND LOW
BIDDER HAD BEEN PERMITTED TO BID IN THE SAME MANNER, THE LOW BID
MAY BE ACCEPTED.
2. A PROTEST THAT A SOLICITATION IS DEFECTIVE
BECAUSE ITS PROVISIONS ARE SUBJECT TO INCONSISTENT INTERPRETATIONS
IS UNTIMELY WHERE IT IS NOT FILED UNTIL AFTER BID OPENING, SINCE
OUR BID PROTEST PROCEDURES, 4 C.F.R. SEC. 21.2 (B)(1) REQUIRE THAT
PROTESTS BASED ON SOLICITATION IMPROPRIETIES APPARENT PRIOR TO BID
OPENING MUST BE FILED PRIOR TO BID OPENING TO BE TIMELY.
3. SINCE AN UNBALANCED BID IS UNACCEPTABLE ONLY
IF IT IS BOTH MATHEMATICALLY UNBALANCED, I.E., BID ITEMS DO NOT
CARRY THEIR FAIR SHARE OF THE COST OF THE WORK PLUS PROFIT, AND
MATERIALLY UNBALANCED, I.E., THERE IS A REASONABLE DOUBT THAT
AWARD TO THE BIDDER WILL NOT RESULT IN THE LOWEST ULTIMATE COST TO
THE GOVERNMENT, THEN A LOW BID SIGNIFICANTLY LOWER THAN ALL OTHER
BIDS AND RESULTING IN THE LOWEST ULTIMATE COST TO THE GOVERNMENT
EVEN IF THE PROCUREMENT IS TERMINATED AFTER THE FIRST OPERATIONAL
MONTH IS NOT UNACCEPTABLE.
EVERETT DYKES GRASSING COMPANY; PEACH STATE SANITATION CO., INC.:
EVERETT DYKES GRASSING COMPANY AND PEACH STATE SANITATION CO., INC.,
PROTEST ANY AWARD BY THE DEPARTMENT OF THE AIR FORCE TO MARK DUNNING
INDUSTRIES, INC. (MDI), UNDER INVITATION FOR BIDS NO. F09650-83-B0009
FOR THE COLLECTION, TRANSPORTATION AND DISPOSAL OF REFUSE GENERATED AT
ROBINS AIR FORCE BASE, GEORGIA. EVERETT DYKES AND PEACH STATE ALLEGE,
AMONG OTHER THINGS, THAT MDI'S BID WAS NONRESPONSIVE TO THE SOLICITATION
REQUIREMENT THAT THE UNIT PRICE OFFERED FOR EACH ITEM SHALL BE THE SAME
FOR ALL YEARS IN THE MULTIYEAR PROCUREMENT. WE DISMISS THE PROTEST IN
PART AND DENY THE REMAINDER.
THE IFB, AS AMENDED, SOLICITED BIDS FOR THE COLLECTION,
TRANSPORTATION AND DISPOSAL OF REFUSE FOR 5 PROGRAM YEARS. BIDDERS WERE
INSTRUCTED TO PRICE SEVERAL ITEMS IN THE FIRST PROGRAM YEAR, INCLUDING:
ITEM NO. 0001, A 2-MONTH ORIENTATION PERIOD DURING WHICH THE CONTRACTOR
COULD BECOME FURTHER FAMILIAR WITH THE NATURE OF THE REQUIRED WORK,
PREPARE PLANS AND PROCEDURES FOR ACCOMPLISHING THAT WORK, AND OBTAIN AND
PLACE NECESSARY EQUIPMENT; ITEM NO. 0002AA, A MONTHLY RATE FOR THE
FIRST 10 OPERATIONAL MONTHS OF REFUSE COLLECTION, TRANSPORTATION AND
DISPOSAL; AND ITEM NO. 0002AC, AN HOURLY RATE FOR AN ESTIMATED 80 HOURS
OF EXTRA WORK OVER AND ABOVE THAT OTHERWISE REQUIRED BY THE
SPECIFICATIONS. FOR EACH OF THE SECOND THROUGH THE FIFTH PROGRAM YEARS,
BIDDERS WERE REQUIRED TO PRICE A MONTHLY RATE FOR 12 MONTHS OF REFUSE
COLLECTION, TRANSPORTATION AND DISPOSAL AND, IN ANOTHER ITEM, AN HOURLY
RATE FOR AN ESTIMATED 96 HOURS OF EXTRA WORK. BIDDERS WERE CAUTIONED
THAT THE ESTIMATES OF EXTRA WORK WERE FOR EVALUATION AND FUNDING
PURPOSES ONLY, THAT THE GOVERNMENT DID NOT GUARANTEE THAT THE ESTIMATED
AMOUNT OF WORK WOULD INDEED BE REQUIRED, AND THAT THE FIXED HOURLY RATE
OFFERED WOULD APPLY REGARDLESS OF THE AMOUNT OF EXTRA WORK ACTUALLY
REQUIRED.
THE SOLICITATION PROVIDED IN SECTION L-29 THAT:
"(B) THE UNIT PRICE OFFERED FOR EACH ITEM IN
THE MULTI-YEAR REQUIREMENTS SHALL BE THE SAME
FOR ALL PROGRAM YEARS INCLUDED THEREIN."
BIDDERS WERE REQUIRED TO SUBMIT A PRICE FOR ALL MULTIYEAR REQUIREMENTS
AND WERE INFORMED THAT BIDS WOULD BE EVALUATED BY ADDING THE EXTENDED
PRICES, I.E., THE UNIT PRICE MULTIPLIED BY THE QUANTITY, FOR EACH ITEM
IN THE SCHEDULE.
THE AIR FORCE RECEIVED SEVEN BIDS IN RESPONSE TO THE SOLICITATION,
WITH MDI, EVERETT DYKES AND PEACH STATE SUBMITTING THE APPARENT LOW BID,
SECOND LOW BID AND THIRD LOW BID RESPECTIVELY, AS INDICATED BELOW.
FIRST PROGRAM YEAR
ITEM 0001 ORIENTATION
MDI $ 5000.00
EVERETT DYKES 20000.00
PEACH STATE 0.00
ITEM 0002AA MONTHLY RATE FOR INITIAL 10 MOS. OF THE OPERATIONAL
PERFORMANCE PERIOD
MDI (SUBTOTAL) 36639.91
(366399.10)
EVERETT DYKES 40500.00
(405000.00)
PEACH STATE 41792.00
(417920.00)
ITEM 0002AC HOURLY RATE FOR ESTIMATED 80 HRS OF EXCESS WORK
MDI (SUBTOTAL) 23.08
(1846.40)
EVERETT DYKES 20.00
(1600.00)
PEACH STATE 20.00
(1600.00)
SECOND THROUGH THE FIFTH PROGRAM YEAR
ITEM -2AA MONTHLY RATE FOR 12 MONTHS OF THE OPERATIONAL PERFORMANCE
PERIOD
MDI (SUBTOTAL) 37139.91
(445678.92)
EVERETT DYKES 40500.00
(486000.00)
PEACH STATE 41792.00
(501504.00)
ITEM -2AC HOURLY RATE FOR ESTIMATED 96 HRS OF EXCESS WORK
MDI (SUBTOTAL) 23.08
(2215.68)
EVERETT DYKES 20.00
(1920.00)
PEACH STATE 20.00
(1920.00)
ITEM TOTAL
MDI 2164823.90
EVERETT DYKES 2378280.00
PEACH STATE 2433216.00
SINCE MDI OFFERED A MONTHLY RATE OF $36,639.91 FOR THE 10 OPERATIONAL
MONTHS OF THE FIRST PROGRAM YEAR BUT OFFERED A MONTHLY RATE OF
$37,139.91 FOR THE SECOND THROUGH THE FIFTH PROGRAM YEARS, THE AIR FORCE
INITIALLY FOUND MDI'S BID NONRESPONSIVE TO THE IFB REQUIREMENT THAT THE
UNIT PRICE FOR EACH ITEM BE THE SAME FOR ALL PROGRAM YEARS. HOWEVER,
MDI RESPONDED AFTER BID OPENING THAT IT IN EFFECT HAD OFFERED THE SAME
MONTHLY RATE FOR ALL PROGRAM YEARS, CONTENDING THAT THE $5,000 PRICE IT
HAD OFFERED FOR THE ORIENTATION PERIOD IN THE FIRST PROGRAM YEAR SHOULD
BE AMORTIZED OVER THE 10 OPERATIONAL MONTHS OF THE FIRST PROGRAM YEAR TO
YIELD A MONTHLY RATE OF $37,139.91 (($5000 DIVIDED BY 10) + 36,639.91 =
$37,139.91), THE SAME MONTHLY RATE OFFERED FOR SUBSEQUENT PROGRAM YEARS.
THE AIR FORCE FOUND MDI'S BID IN THIS REGARD TO BE CONSISTENT WITH A
REASONABLE INTERPRETATION OF THE SPECIFICATIONS, GIVEN WHAT THE AIR
FORCE BELIEVED TO BE AN ABSENCE OF IFB PROVISIONS TO THE CONTRARY, AND
DETERMINED THAT, IN ANY CASE, EVEN IF MDI HAD DEVIATED FROM THE IFB, THE
OTHER BIDDERS WOULD NOT BE PREJUDICED BY ACCEPTANCE OF MDI'S BID. THE
AIR FORCE ACCORDINGLY DETERMINED MDI'S OTHERWISE LOW BID SHOULD BE
ACCEPTED. EVERETT DYKES AND PEACH STATE HAD MEANWHILE FILED THIS
PROTEST WITH OUR OFFICE.
EVERETT DYKES AND PEACH STATE ALLEGE THAT MDI'S BID SHOULD HAVE BEEN
REJECTED AS NONRESPONSIVE TO THE LEVEL PRICING REQUIREMENT BECAUSE THE
UNIT PRICE OF $36,639.91 PER OPERATIONAL MONTH OFFERED BY MDI FOR THE
FIRST PROGRAM YEAR WAS DIFFERENT THAN THE UNIT PRICE OF $37,139.91 PER
OPERATIONAL MONTH OFFERED FOR SUCCEEDING PROGRAM YEARS. HOWEVER, WE NEED
NOT CONSIDER WHETHER MDI'S BID INDEED DEVIATED FROM THE SPECIFICATIONS,
SINCE EVEN IF IT DID DEVIATE, WE BELIEVE THAT THE AIR FORCE DID NOT ERR
IN ACCEPTING THE BID.
IN ORDER TO ENSURE THAT ALL BIDDERS COMPETE ON AN EQUAL FOOTING AND
THEREBY PROTECT THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM, WE HAVE
HELD THAT AGENCIES GENERALLY MAY NOT ACCEPT A BID DEVIATING FROM THE
MATERIAL REQUIREMENTS OF THE SOLICITATION. SEE UNION CARBIDE
CORPORATION, 56 COMP.GEN. 487 (1977), 77-1 CPD 243. HOWEVER, WHERE
ACCEPTANCE OF A DEVIATING BID WOULD RESULT IN A CONTRACT WHICH WOULD
SATISFY THE GOVERNMENT'S ACTUAL NEEDS AND WOULD NOT PREJUDICE ANY OTHER
BIDDER, WE HAVE PERMITTED ACCEPTANCE, NOTWITHSTANDING THE FACT THAT THE
BID WAS TECHNICALLY NONRESPONSIVE, BECAUSE THE INTEGRITY OF THE
COMPETITIVE BIDDING SYSTEM WAS NOT THEREBY ADVERSELY AFFECTED. SEE
UNION CARBIDE CORPORATION, SUPRA. CONSISTENT WITH THAT RATIONALE, WE
HELD THAT IN CERTAIN CIRCUMSTANCES IT WAS IMPROPER TO REJECT A BID WHICH
DID NOT ADHERE TO A LEVEL PRICING PROVISION FOR A MULTIYEAR CONTRACT.
KECO INDUSTRIES, INC., 54 COMP.GEN. 967 (1975), 75-1 CPD 301. IN THAT
CASE, THE LOW BIDDER ADDED ITS PRICE FOR A NONRECURRING COST ITEM TO ITS
PRICE FOR THE FIRST PROGRAM YEAR ITEM AND ACCORDINGLY OFFERED A HIGHER
PRICE FOR THE FIRST PROGRAM YEAR THAN FOR EACH OF THE 2 SUCCEEDING
PROGRAM YEARS, DESPITE A SOLICITATION PROVISION REQUIRING THE UNIT PRICE
TO BE THE SAME FOR ALL PROGRAM YEARS. SINCE THE BIDDER'S OVERALL LOW
BID WOULD STILL HAVE BEEN LOW EVEN IF THE PROCUREMENT WAS CANCELED AFTER
THE FIRST PROGRAM YEAR, AND SINCE NO PREJUDICE WOULD RESULT TO OTHER
BIDDERS BY ACCEPTANCE OF THE LOW BID BECAUSE THE SPREAD BETWEEN THE
FIRST AND SECOND LOW BIDDERS WAS SO SIGNIFICANT THAT THE SECOND LOW
BIDDER WOULD NOT HAVE BEEN LOW EVEN IF IT HAD BEEN PERMITTED TO BID IN
THE SAME DEVIANT MANNER, WE HELD THAT THE AGENCY'S REJECTION OF THE LOW
BID AS NONRESPONSIVE WAS IMPROPER. SEE ALSO INTERNATIONAL HARVESTER
COMPANY, B-212341, SEPTEMBER 12, 1983, 83-2 CPD 313.
WE AGREE WITH THE AIR FORCE THAT ACCEPTANCE OF MDI'S BID DID NOT
PREJUDICE OTHER BIDDERS SINCE THE SPREAD BETWEEN MDI AND EVERETT DYKES,
THE APPARENT SECOND LOW BIDDER, IS SO LARGE, WITH EVERETT DYKES' BID
$213,456.10 OR 9.86 PERCENT MORE THAN THAT OF MDI, THAT EVEN IF EVERETT
DYKES HAD BEEN ABLE TO VARY ITS MONTHLY RATE FOR EACH YEAR OF THE
MULTIYEAR PROCUREMENT IT WOULD STILL NOT HAVE BEEN LOW. NOR DO WE
BELIEVE THAT ACCEPTANCE OF MDI'S BID OTHERWISE PREJUDICED THE
GOVERNMENT, SINCE MDI AGREED TO SATISFY THE GOVERNMENT'S ACTUAL NEEDS AT
A PRICE WHICH WAS NOT ONLY $213,456.10 LESS THAN THAT OF THE SECOND LOW
BIDDER OVER ALL 5 PROGRAM YEARS, BUT WHICH WAS ALSO LOW EVEN IF THE
CONTRACT WAS CANCELED OR TERMINATED AFTER THE FIRST OPERATIONAL MONTH.
PEACH STATE ALSO ALLEGES THAT THE PROVISIONS OF THE IFB ARE SUBJECT
TO INCONSISTENT INTERPRETATIONS IN REGARD TO THE EFFECT OF THE
REQUIREMENT FOR THE LEVEL PRICING OF ITEMS ON THE TREATMENT OF THE
ORIENTATION PERIOD, ITEM NO. 0001. HOWEVER, WE NEED NOT ADDRESS THE
MERITS OF THIS ALLEGATION SINCE IT WAS NOT RAISED UNTIL AFTER BID
OPENING AND IS THEREFORE UNTIMELY. OUR BID PROTEST PROCEDURES, 4 C.F.
R. SEC. 21.2(B)(1) (1983), REQUIRE THAT PROTESTS BASED ON SOLICITATION
IMPROPRIETIES APPARENT PRIOR TO BID OPENING, SUCH AS THE INCONSISTENCIES
ALLEGED HERE, MUST BE FILED PRIOR TO BID OPENING TO BE TIMELY. SEE GAS
TURBINE CORPORATION, B-210411, MAY 25, 1983, 83-1 CPD 566.
PEACH STATE FURTHER CONTENDS THAT THE COST OF LABOR IN PERFORMING A
CONTRACT AWARDED UNDER THIS SOLICITATION COULD BE A RELATIVELY
INSIGNIFICANT AMOUNT AND THAT THE PREPONDERANCE OF ALL COSTS WOULD BE
NONRECURRING COSTS, SUCH AS THOSE ARISING FROM THE INITIAL ACQUISITION
AND PLACEMENT OF REFUSE RECEPTACLES, TRUCKS AND OTHER MAJOR EQUIPMENT,
WHICH NECESSARILY WOULD BE INCURRED DURING THE ORIENTATION PERIOD.
PEACH STATE THEREFORE CONCLUDES THAT,
"ACCORDINGLY ANY BIDDER, OTHER THAN THE
INCUMBENT CONTRACTOR, THAT DOES NOT REFLECT
AN AMOUNT (UNIT PRICE) UNDER ITEM 0001 (TWO
MONTHS) THAT APPROXIMATES OR EXCEEDS THE
AMOUNT (UNIT PRICE) UNDER ITEM 0002AA MUST BE
SUSPECT OF AN 'UNBALANCED BID.'"
PEACH STATE THEN INDICATES THAT IT IS "HIGHLY SUSPECT" THAT ALL BIDDERS
BUT PEACH STATE, THE INCUMBENT CONTRACTOR, SUBMITTED UNBALANCED BIDS.
UNBALANCED BIDDING IS THE PRACTICE OF BIDDING HIGH ON SOME ITEMS AND
LOW ON OTHER ITEMS. WE HAVE RECOGNIZED TWO ASPECTS TO UNBALANCED
BIDDING, BOTH OF WHICH MUST EXIST BEFORE A BID IS DEEMED NONRESPONSIVE.
FIRST, THE BID MUST BE MATHEMATICALLY UNBALANCED. THIS INVOLVES A
DETERMINATION AS TO WHETHER EACH BID ITEM CARRIES ITS SHARE OF THE WORK
PLUS PROFIT, OR WHETHER THE BID IS BASED ON NOMINAL PRICES FOR SOME WORK
AND ENHANCED PRICES FOR OTHER WORK. THE SECOND ASPECT IS THAT THE BID
MUST BE MATERIALLY UNBALANCED, THAT IS THERE MUST BE A DETERMINATION
THAT THERE IS A REASONABLE DOUBT THAT AWARD TO THE BIDDER SUBMITTING A
MATHEMATICALLY UNBALANCED BID WILL NOT RESULT IN THE LOWEST ULTIMATE
COST TO THE GOVERNMENT. SEE MICROFORM INC. - RECONSIDERATION,
B-208117.2, SEPTEMBER 27, 1983, 83-2 CPD 380; JIMMY'S APPLIANCES, 61
COMP.GEN. 444 (1982), 82-1 CPD 542.
EVEN IF WE WERE TO FIND MDI'S BID MATHEMATICALLY UNBALANCED, PEACH
STATE HAS FAILED TO SHOW THAT THERE IS A REASONABLE DOUBT THAT AWARD TO
MDI WOULD NOT RESULT IN THE LOWEST ULTIMATE COST TO THE GOVERNMENT. SEE
CONTRA COSTA ELECTRIC, INC., B-200660, MARCH 16, 1981, 81-1 CPD 196
(PROTESTER HAS BURDEN OF SHOWING THAT BID IS UNBALANCED). THE AIR FORCE
IS CONTRACTING TO PAY A FIXED PRICE FOR A SPECIFIED LEVEL OF SERVICES,
EXCEPT FOR THE PROVISIONS RELATING TO POSSIBLE EXTRA WORKING HOURS, THE
COST OF WHICH IS MINISCULE WHEN COMPARED TO THE TOTAL PRICE OFFERED BY
MDI AND EVERETT DYKES. THUS, THERE IS NO REASON TO EXPECT THAT MDI
COULD RECOUP ANY OF THE LOSS ALLEGED TO BE LIKELY DURING THE ORIENTATION
PERIOD BY SECURING PAYMENT FOR SUBSEQUENT SERVICES AT A RATE WHICH IS
BOTH IN EXCESS OF ITS COSTS FOR THOSE SUBSEQUENT SERVICES AND NOT TAKEN
INTO ACCOUNT DURING THE INITIAL EVALUATION FOR AWARD. ALTHOUGH
TERMINATION OF THE CONTRACT IS NOT TO BE EXPECTED GIVEN THE LIKELY
CONTINUING NATURE OF THE REQUIREMENT FOR REFUSE COLLECTION AND DISPOSAL
AND THE REASONABLE EXPECTATION THAT CONTINUED FUNDING WILL BE AVAILABLE
FOR SERVICES OF THIS NATURE, SEE RELIABLE TRASH SERVICES, B-194760,
AUGUST 9, 1979, 79-2 CPD 107, WE AGAIN NOTE THAT MDI HAS OFFERED A PRICE
WHICH IS LOW EVEN IF THE PROCUREMENT SHOULD BE TERMINATED AFTER THE
FIRST OPERATIONAL MONTH.
THE PROTEST IS DISMISSED IN PART AND DENIED IN PART.
B-210223.2, JUN 14, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. WHERE AN AGENCY INITIATES A NEGOTIATED PROCUREMENT WHEN IT SHOULD
HAVE CONDUCTED AN ADVERTISED PROCUREMENT, THE CONTRACTING OFFICER HAS A
REASONABLE BASIS TO CANCEL THE REQUEST FOR PROPOSALS IN ORDER TO ISSUE
AN INVITATION FOR BIDS.
2. WHERE NEITHER THE PRICES RECEIVED IN RESPONSE TO A REQUEST FOR
PROPOSALS (RFP) NOR THE RELATIVE POSITIONS OF OFFERORS HAVE BEEN
DISCLOSED AND THE PROTESTER MERELY PRESENTS SPECULATION AS TO THE
GREATER RISK OF DISCLOSURE ARISING FROM THE AGENCY'S CANCELLATION THE
RFP AND RESOLICITATION UNDER AN INVITATION FOR BIDS, THE FEAR OF A
POSSIBLE AUCTION IS NOT A SUFFICIENT REASON TO OBJECT TO RESOLICITATION.
PEACH STATE SANITATION CO., INC.:
PEACH STATE SANITATION CO., INC., PROTESTS THE CANCELLATION OF
REQUEST FOR PROPOSALS NO. F09650-82-R-0402, ISSUED BY THE DEPARTMENT OF
THE AIR FORCE, WARNER ROBINS AIR LOGISTICS CENTER, ROBINS AIR FORCE
BASE, GEORGIA, FOR REFUSE COLLECTION AND DISPOSAL AT ROBINS AFB, AND THE
SUBSEQUENT RESOLICITATION OF THESE SERVICES UNDER INVITATION FOR BIDS
NO. F09650-83-B-0009. WE DENY THE PROTEST.
AFTER THE AIR FORCE ISSUED THE RFP FOR REFUSE COLLECTION AND DISPOSAL
AT ROBINS AFB ON NOVEMBER 5, 1982, RELIABLE TRASH SERVICE, INC.
PROTESTED THE SOLICITATION TO THE AIR FORCE, ALLEGING, IN PART, THAT A
NEGOTIATED PROCUREMENT WAS IMPROPER BECAUSE AN ADVERTISED PROCUREMENT
WAS FEASIBLE AND PRACTICABLE. RELIABLE DID NOT SUBMIT A PROPOSAL. THE
CONTRACTING OFFICER DENIED THE PROTEST, INDICATING THAT IT WAS
IMPOSSIBLE TO DRAFT, FOR A SOLICITATION OF BIDS, ADEQUATE SPECIFICATIONS
OR ANY OTHER ADEQUATELY DETAILED DESCRIPTION OF THE REQUIRED SERVICES.
AFTER RECEIVING NOTICE OF THE DENIAL OF ITS PROTEST, RELIABLE FILED A
PROTEST WITH OUR OFFICE. WHILE THIS PROTEST WAS PENDING, HEADQUARTERS,
AIR FORCE LOGISTICS COMMAND, CONCLUDED THAT SINCE THE REQUIREMENT WAS
ROUTINE AND THE SPECIFICATIONS DETAILED, THE PROCUREMENT FOR REFUSE
COLLECTION DID NOT WARRANT AN EXCEPTION TO THE STATUTORY PREFERENCE FOR
ADVERTISING. SEE 10 U.S.C. SEC. 2304(A) (1976), AS AMENDED BY PUB.L.
97-86, SEC. 907(A), 95 STAT. 1117 (1981). THE COMMAND THEREFORE
DIRECTED ROBINS TO CANCEL THE RFP AND RESOLICIT FOR THESE SERVICES UNDER
A FORMALLY ADVERTISED INVITATION FOR BIDS. RELIABLE ACCORDINGLY
WITHDREW ITS PROTEST. PEACH STATE, THE INCUMBENT CONTRACTOR, THEN
PROTESTED THE CANCELLATION AND RESOLICITATION TO OUR OFFICE.
AS A GENERAL RULE, PURCHASES AND CONTRACTS FOR SUPPLIES AND SERVICES
SHALL BE MADE BY FORMAL ADVERTISEMENT UNLESS BOTH IT IS NEITHER FEASIBLE
NOR PRACTICABLE TO PROCURE BY ADVERTISEMENT AND THE AGENCY DETERMINES
THAT NEGOTIATION IS NECESSARY UNDER ONE OF SEVERAL EXCEPTIONS ENUMERATED
IN SECTION 2304(A). SEE B.B.SAXON COMPANY, INC., 57 COMP.GEN. 501
(1978), 78-1 CPD 410; WASHINGTON PATROL SERVICE, INC., ET AL.,
B-188375, SEPTEMBER 21, 1977, 77-2 CPD 209. THIS PREFERENCE FOR
ADVERTISING APPLIES EVEN TO PROCUREMENTS MADE, AS APPARENTLY IS THE CASE
HERE, AS TOTAL SMALL BUSINESS SET-ASIDES. B.B. SAXON COMPANY, SUPRA.
A PROTESTER DISPUTING AN AGENCY'S DETERMINATION THAT A PROCUREMENT
MUST BE MADE BY ADVERTISING BEARS THE BURDEN OF CLEARLY SHOWING THAT IT
IS NEITHER FEASIBLE NOR PRACTICABLE TO PROCURE BY ADVERTISEMENT AND THAT
NEGOTIATION IS NECESSARY UNDER ONE OF THE EXCEPTIONS ENUMERATED IN
SECTION 2304(A). SEE WASHINGTON PATROL SERVICE, SUPRA. THIS PEACH
STATE HAS NOT DONE.
WE NOTE, HOWEVER, THAT EVEN IF PEACH STATE HAD ALLEGED THAT
PROCUREMENT BY ADVERTISEMENT WAS IMPRACTICABLE, THE CIRCUMSTANCES OF
THIS PROCUREMENT SUGGEST OTHERWISE. WE HAVE PREVIOUSLY INDICATED THAT
PROCUREMENTS OF TRASH COLLECTION SERVICES ARE COMMONLY CONDUCTED BY THE
FEDERAL GOVERNMENT USING FORMAL ADVERTISING. SEE KENILWORTH TRASH
COMPANY, B-204913, JUNE 7, 1982, 82-1 CPD 540. FURTHER, THE AIR FORCE
INFORMS US THAT OF THE NINE CONTRACTS FOR REFUSE COLLECTION AND DISPOSAL
AWARDED BY THE AIR FORCE LOGISTICS COMMAND IN THE LAST 3 YEARS, EIGHT OF
THE CONTRACTS WERE FORMALLY ADVERTISED, WHILE THE OTHER ONE WAS AWARDED
TO THE SMALL BUSINESS ADMINISTRATION FOR SUBCONTRACTING UNDER THE
SECTION 8(A) PROGRAM. THERE IS NO INDICATION OF ANYTHING UNIQUE OR
DIFFERENT IN THIS PROCUREMENT THAT MIGHT WARRANT PROCUREMENT BY
NEGOTIATION. WE THEREFORE MUST ASSUME THAT THE AIR FORCE CORRECTLY
CONCLUDED THAT THIS PROCUREMENT FOR REFUSE COLLECTION AND DISPOSAL
SHOULD BE CONDUCTED BY FORMAL ADVERTISEMENT.
PEACH STATE ARGUES THAT THE AIR FORCE IS ENGAGED IN A PAPER EXERCISE
WHICH MAY "SET THE RECORD STRAIGHT" INSOFAR AS USING THE CORRECT
PROCUREMENT METHOD IS CONCERNED, BUT AT THE RISK OF COMPROMISING THE
COMPETITIVE POSITION OF FIRMS SUCH AS ITSELF WHO SUBMITTED OFFERS UNDER
THE RFP. IT FEARS THAT IF THE PRICES OFFERED UNDER THE RFP SHOULD
INADVERTENTLY BE DISCLOSED, AN AUCTION COULD RESULT, AND IT ASSERTS
THAT, SINCE THOSE BIDDERS WHO WERE OFFERORS UNDER THE RFP HAVE INCURRED
PROPOSAL PREPARATION COSTS, THEY ARE AT A COMPETITIVE DISADVANTAGE IN
RELATION TO BIDDERS, SUCH AS RELIABLE, WHO DID NOT SUBMIT PROPOSALS.
CONTRACTING AGENCIES HAVE BROAD DISCRETION IN DETERMINING WHEN IT IS
APPROPRIATE TO CANCEL A SOLICITATION. WHEN NEGOTIATION PROCEDURES ARE
USED, THE GOVERNMENT NEED ONLY ESTABLISH A REASONABLE BASIS FOR
CANCELLATION. AMERICAN INDIAN HEALTH SYSTEMS, INC., B-206218, JULY 12,
1982, 82-2 CPD 38. AS A GENERAL RULE, WHERE AN AGENCY CONDUCTS A
NEGOTIATED PROCUREMENT WHEN IT SHOULD HAVE CONDUCTED AN ADVERTISED
PROCUREMENT, THEN THE CONTRACTING OFFICER HAS A REASONABLE BASIS TO
CANCEL THE RFP IN ORDER TO ISSUE AN INVITATION FOR BIDS. SEE WASHINGTON
PATROL SERVICE, SUPRA; NJE CORPORATION, B-185787, AUGUST 3, 1976, 76-2
CPD 117.
WE HAVE DENIED REQUESTS THAT A PROCUREMENT WHICH IMPROPERLY HAS BEEN
NEGOTIATED BE RE-SOLICITED THROUGH ADVERTISING WHERE ADEQUATE
COMPETITION HAS BEEN OBTAINED AND THE RESULTS OF THE PROCUREMENT WOULD
HAVE BEEN THE SAME REGARDLESS OF THE METHOD OF PROCUREMENT USED, BECAUSE
THE PROTESTER IN THOSE INSTANCES HAS NOT BEEN PREJUDICED AND A
RESOLICITATION WOULD BE TANTAMOUNT TO SANCTIONING A PROHIBITED AUCTION.
SEE, E.G., TELECTRO-MEK, INC., B-190653, APRIL 13, 1979, 79-1 CPD 263.
WE AGREE WITH THE AIR FORCE THAT THIS CASE IS DISTINGUISHABLE IN THAT IT
CANNOT BE SAID THAT (1) RESULTS OF THE COMPETITION WOULD HAVE BEEN THE
SAME USING EITHER NEGOTIATION OR ADVERTISING SINCE AT LEAST ONE FIRM -
RELIABLE - DID NOT RESPOND TO THE RFP OR (2) THAT RELIABLE, THE FIRM
WHICH PROTESTED THE USE OF NEGOTIATION, WAS NOT PREJUDICED BECAUSE IT IS
CLEAR THAT RELIABLE DID NOT COMPETE UNDER THE FIRST SOLICITATION BECAUSE
OF THE METHOD OF PROCUREMENT USED. IN ADDITION, THE AIR FORCE'S ACTION
DOES MORE THAN MERELY CORRECT THE RECORD; IT ALSO CORRESPONDS TO THE
STATUTORILY EXPRESSED PREFERENCE FOR FORMAL ADVERTISEMENT WHEREVER
PRACTICABLE. UNDER THESE CIRCUMSTANCES, THE AIR FORCE HAD A REASONABLE
BASIS TO CANCEL THE RFP IN ORDER TO ISSUE AN INVITATION FOR BIDS.
WITH RESPECT TO PEACH STATE'S ASSERTION THAT A RESOLICITATION MAY
RESULT IN AN AUCTION, A PRACTICE PROHIBITED BY REGULATION, THE AIR FORCE
INFORMS US THAT NEITHER THE PRICES NOR THE RELATIVE POSITIONS OF THE
OFFERORS HAVE BEEN DISCLOSED. PEACH STATE'S MERE SPECULATION AS TO THE
SUPPOSEDLY INCREASED RISKS OF DISCLOSURE ARISING FROM THE CANCELLATION
AND RESOLICITATION DOES NOT PROVIDE A BASIS FOR OBJECTING TO THE ACTION
TAKEN HERE.
FINALLY, THAT SMALL BUSINESS CONCERNS MAY HAVE EXPENDED FUNDS
PREPARING PROPOSALS DOES NOT JUSTIFY CONTINUATION OF A PROCUREMENT WHICH
THE AGENCY PROPERLY BELIEVES TO BE IN CONFLICT WITH LEGAL REQUIREMENTS.
THE PROTEST IS DENIED.
B-210220, JAN 18, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
A PROTEST, ALLEGING THAT SPECIFIED QUANTITIES OF AN ITEM EXCEED THE
REQUIREMENTS OF THE AGENCY, NOT RECEIVED IN OUR OFFICE UNTIL AFTER BID
OPENING IS UNTIMELY UNDER SECTION 21.2(B)(1) OF OUR BID PROTEST
PROCEDURES, 4 C.F.R. SEC. 21.2(B)(1) (1982), AND WILL NOT BE CONSIDERED.
GRANITE DIAGNOSTICS, INC.:
GRANITE DIAGNOSTICS, INC. (GRANITE), PROTESTS THE PROCUREMENT OF SXT
BLOOD AGAR UNDER INVITATION FOR BIDS (IFB) NO. N00189-82-B-0096 ISSUED
BY THE NAVAL SUPPLY CENTER, NORFOLK, VIRGINIA. GRANITE ALLEGES THAT THE
QUANTITIES OF SXT BLOOD AGAR SPECIFIED IN THE IFB GREATLY EXCEED THE
QUANTITIES NEEDED BY THE NAVAL HOSPITAL AND ASSERTS THAT THE ITEMS
SHOULD BE REMOVED FROM THE IFB.
WE DISMISS THE PROTEST.
GRANITE HAS INFORMALLY ADVISED OUR OFFICE THAT BIDS WERE OPENED ON
SEPTEMBER 1, 1982. THE PROTEST WAS NOT RECEIVED IN OUR OFFICE UNTIL
DECEMBER 14, 1982. SECTION 21.2(B)(1) OF OUR BID PROTEST PROCEDURES, 4
C.F.R. SEC. 21.2(B)(1) (1982), REQUIRES THAT A PROTEST BASED UPON
ALLEGED IMPROPRIETIES IN ANY TYPE OF SOLICITATION WHICH ARE APPARENT
PRIOR TO BID OPENING MUST BE RECEIVED IN OUR OFFICE PRIOR TO BID
OPENING.
SINCE THE ALLEGED EXCESSIVE QUANTITIES OF BLOOD AGAR WAS SPECIFIED IN
THE IFB AND WAS APPARENT PRIOR TO BID OPENING, THE PROTEST, NOT RECEIVED
IN OUR OFFICE UNTIL WELL AFTER BID OPENING, IS UNTIMELY AND WILL NOT BE
CONSIDERED.
B-210218; B-210218.2, SEP 30, 1983
HEADNOTES-UNAVAILABLE
DIGEST:
1. AGENCY CONDUCTED MEANINGFUL NEGOTIATIONS WITH
OFFEROR WHERE IT REPEATEDLY BROUGHT MATERIAL DEFICIENCIES TO
OFFEROR'S ATTENTION DURING THE COURSE OF NEGOTIATIONS, AND THE
OFFEROR WAS SPECIFICALLY REQUESTED IN ITS INVITATION TO SUBMIT A
BEST AND FINAL OFFER OF THE SPECIFIC DEFICIENCY WHICH CAUSED ITS
PROPOSAL TO BE SUBSTANTIALLY DOWNGRADED.
2. PROTESTER'S BEST AND FINAL OFFER WAS PROPERLY
FOUND TECHNICALLY DEFICIENT WHERE IT FAILED TO RECTIFY A TECHNICAL
DEFICIENCY WHICH WAS REPEATEDLY BROUGHT TO PROTESTER'S ATTENTION
DURING NEGOTIATIONS.
3. WHERE PROTESTER'S PROPOSAL WAS PROPERLY
ELIMINATED FROM CONSIDERATION BECAUSE OF TECHNICAL DEFICIENCY, GAO
NEED NOT ADDRESS PROTESTER'S OBJECTION THAT IT WAS UNFAIRLY
EVALUATED WITH RESPECT TO ITS PAST PERFORMANCE RECORD SINCE THIS
COULD NOT HAVE MATERIALLY AFFECTED PROTESTER'S CHANCES FOR AWARD.
4. AGENCY IMPROPERLY DOWNGRADED PROTESTER FOR PRICE
RISK BASED ON GOVERNMENT'S INDEPENDENT COST ESTIMATE WHERE
TECHNICAL EVALUATION AND A SPECIFIC PROPOSAL COST EVALUATION
SHOWED THAT PROTESTER COULD PROVIDE PERFORMANCE AT A LEVEL EQUAL
TO THE AWARDEE'S AND AT A SIGNIFICANTLY LOWER COST.
5. SMALL BUSINESS PROTESTER'S PROPOSAL COULD BE
DOWNGRADED FOR A POOR PAST PERFORMANCE RECORD, WITHIN THE CONTEXT
OF EXPLICITLY STATED CRITERIA, WITHOUT THE NECESSITY FOR REFERRAL
TO THE SMALL BUSINESS ADMINISTRATION FOR CONSIDERATION UNDER
CERTIFICATE OF COMPETENCY PROCEDURES. HOWEVER, AGENCY CANNOT
REASONABLY DOWNGRADE OFFER IN THIS REGARD AS A SEPARATE EVALUATION
FACTOR, WHERE THE SOLICITATION PROVIDES THAT PAST PERFORMANCE WILL
BE CONSIDERED WITHIN THE CONTEXT OF OTHER STATED EVALUATION
CRITERIA, AND NOT AS AN INDEPENDENTLY RATED FACTOR, AND THE
TECHNICAL EVALUATION ALREADY REFLECTS CONSIDERATION OF PAST
PERFORMANCE IN A FINDING THAT THE PROTESTER'S OFFER IS TECHNICALLY
EQUAL TO THAT OF THE AWARDEE.
6. SINCE PROTESTER HAD SUBSTANTIAL CHANCE FOR AWARD
BUT FOR AGENCY'S IMPROPER ACTION, PROPOSAL PREPARATION COSTS ARE
RECOMMENDED.
METRIC SYSTEMS CORPORATION; COMMAND, CONTROL AND COMMUNICATIONS
CORPORATION:
METRIC SYSTEMS CORPORATION (METRIC) AND COMMAND, CONTROL AND
COMMUNICATIONS CORPORATION (4C) PROTEST THE AWARD OF A CONTRACT TO
AMERICAN DEVELOPMENT CORPORATION (ADCOR), UNDER REQUEST FOR PROPOSALS
(RFP) NO. F19628-82-R-0048, A SMALL BUSINESS SET-ASIDE ISSUED BY THE AIR
FORCE FOR THE PRODUCTION OF THE INTELLIGENCE ANALYSIS CENTER (IAC) FOR
THE UNITED STATES MARINE CORPS. ADCOR WAS AWARDED A FIRM, FIXED-PRICE
CONTRACT FOR $17,093,978, COVERING A BASE AWARD, PLUS THREE OPTIONS,
AMOUNTING TO $12,211,349, FOR A TOTAL EVALUATED PRICE OF $29,305,327.
4C ALLEGES THAT THE AIR FORCE FAILED TO CONDUCT MEANINGFUL
NEGOTIATIONS WITH ALL OFFERORS IN THE COMPETITIVE RANGE - IN PARTICULAR,
THAT THE AIR FORCE FAILED TO ADVISE 4C OF DEFICIENCIES AND THEREBY GIVE
IT AN OPPORTUNITY TO RECTIFY THESE DEFICIENCIES - AND THAT THE AIR FORCE
FAILED TO FOLLOW THE EVALUATION CRITERIA FOR AWARD. METRIC ALLEGES IT
WAS IMPROPERLY DOWNGRADED FOR ITS PAST PERFORMANCE RECORD AND THAT THIS
AMOUNTED TO A NONRESPONSIBILITY DETERMINATION WHICH SHOULD HAVE BEEN
REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR CONSIDERATION
UNDER CERTIFICATE OF COMPETENCY (COC) PROCEDURES, AND THAT METRIC WAS
IMPROPERLY EVALUATED AND DOWNGRADED AS HAVING AN UNREALISTICALLY LOW
PRICE.
WE FIND 4C'S PROTEST WITHOUT MERIT; WE SUSTAIN METRIC'S PROTEST.
4C'S PROTEST
THE RFP STATED THAT THE FOUR SPECIFIC EVALUATION CRITERIA WERE, IN
DESCENDING ORDER OF IMPORTANCE: MANUFACTURING/TECHNICAL, MANAGEMENT,
COST/PRICE, AND LOGISTICS. MANUFACTURING/TECHNICAL WAS STATED TO BE
SIGNIFICANTLY MORE IMPORTANT THAN THE REST OF THE AREAS. THE RFP ALSO
INDICATED THAT THESE FOUR SPECIFIC CRITERIA WOULD BE ASSESSED BY THE
APPLICATION OF SIX GENERAL CONSIDERATIONS, WHICH WERE: UNDERSTANDING
THE REQUIREMENTS, COMPLIANCE WITH REQUIREMENTS, SOUNDNESS OF APPROACH,
SPECIAL TECHNICAL FACTORS, PAST PERFORMANCE, AND RISK ASSESSMENT. THE
RFP FURTHER INDICATED THAT THE REALISM OF THE PROPOSED PRICE WOULD BE
EVALUATED IN DETERMINING THE OFFEROR'S UNDERSTANDING OF THE
REQUIREMENTS, COMPLIANCE WITH REQUIREMENTS AND SOUNDNESS OF APPROACH IN
THE MANUFACTURING/TECHNICAL, MANAGEMENT, AND LOGISTICS AREAS. AWARD WAS
TO BE MADE TO THE RESPONSIBLE OFFEROR WHOSE PROPOSAL WAS MOST
ADVANTAGEOUS TO THE GOVERNMENT, PRICE, INCLUDING OPTIONS, AND OTHER
FACTORS CONSIDERED.
REGARDING 4C'S ALLEGATION OF FAILURE TO CONDUCT MEANINGFUL
NEGOTIATIONS, THE APPLICABLE STANDARD IS THAT THE PROCURING AGENCY MUST
GENERALLY FURNISH INFORMATION TO ALL OFFERORS WITHIN THE COMPETITIVE
RANGE CONCERNING THE AREAS OF DEFICIENCY IN THEIR PROPOSALS, SO THAT
THEY CAN REVISE THEIR PROPOSALS TO SATISFY THE SOLICITATION'S
REQUIREMENTS. JOSEPH LEGAT ARCHITECTS, B-187160, DECEMBER 13, 1977,
77-2 CPD 458. HOWEVER, THE CONTENT AND EXTENT OF THE DISCUSSIONS
REQUIRED UNDER THE CIRCUMSTANCES ARE LARGELY MATTERS FOR DETERMINATION
BY THE CONTRACTING OFFICER, WHOSE JUDGMENT WILL NOT BE DISTURBED BY OUR
OFFICE UNLESS IT IS CLEARLY WITHOUT A REASONABLE BASIS. AUSTIN
ELECTRONICS, 54 COMP.GEN. 60 (1974), 74-2 CPD 61.
IN THIS CASE, AFTER 4C'S INITIAL PROPOSAL WAS FOUND TO BE IN THE
COMPETITIVE RANGE, 4C PARTICIPATED IN A 4-MONTH NEGOTIATION PROCESS
DURING WHICH IT WAS SPECIFICALLY ADVISED OF A VARIETY OF PROPOSAL
DEFICIENCIES. IN PARTICULAR, 4C WAS INITIALLY NOTIFIED OF 14 DEFICIENCY
REPORTS AND 21 CLARIFICATION REQUESTS REGARDING ITS PROPOSAL. UPON
RECEIPT OF ITS REVISED PROPOSAL, 4C WAS ADVISED THAT 8 DEFICIENCY
REPORTS REMAINED UNRESOLVED, AND THAT 11 CLARIFICATION REQUESTS REMAINED
UNRESOLVED. SUBSEQUENTLY, 4C PARTICIPATED IN 2 DAYS OF DISCUSSIONS WITH
THE AGENCY DURING WHICH ALL REMAINING PROPOSAL DEFICIENCIES AND
CLARIFICATIONS WERE DISCUSSED AND DURING WHICH 4C WAS ADVISED OF THE
NECESSITY TO RESOLVE ALL CONTINUING DEFICIENCIES. A SUBSEQUENT 4C
SUBMISSION WAS EVALUATED AND 4C WAS ADVISED THAT THREE DEFICIENCIES,
INCLUDING AN UNACCEPTABLE CABLE INSTALLATION PLAN, REMAINED UNRESOLVED.
THEREAFTER, OFFERORS WERE INVITED TO SUBMIT A BEST AND FINAL OFFER
(BAFO), AND IN 4C'S INVITATION TO SUBMIT A BAFO, IT WAS NOTIFIED OF THE
REMAINING THREE DEFICIENCIES. EVALUATION OF 4C'S BAFO LED TO AN AIR
FORCE DETERMINATION THAT THE DEFICIENCY RELATING TO CABLE INSTALLATION
REMAINED UNRESOLVED. PRIMARILY, AS A RESULT OF THIS DEFICIENCY, 4C WAS
EVALUATED AS HAVING AN UNSOUND TECHNICAL APPROACH WHICH PRESENTED
TECHNICAL, SCHEDULE AND COST RISKS TO THE GOVERNMENT.
IN VIEW OF THE FACT THAT 4C WAS CONSISTENTLY APPRISED OF THE
EXISTENCE OF THE PARTICULAR DEFICIENCY TO WHICH IT POINTS AS EVIDENCING
THE GOVERNMENT'S FAILURE TO CONDUCT MEANINGFUL NEGOTIATIONS, WE FIND
THAT THE AGENCY'S CONDUCT OF NEGOTIATIONS WAS REASONABLE UNDER THE
CIRCUMSTANCES. TO THE EXTENT THAT 4C IS MERELY ARGUING THAT, IN ITS
VIEW, IT SUBMITTED A BAFO WHICH ADEQUATELY ADDRESSED THE CABLE
INSTALLATION DEFICIENCY, THIS CONSTITUTES A DISAGREEMENT WITH THE AGENCY
ASSESSMENT OF THE TECHNICAL MERITS OF A PROPOSAL, WHICH GAO WILL ONLY
QUESTION UPON A CLEAR SHOWING OF UNREASONABLENESS, ABUSE OF DISCRETION,
OR VIOLATION OF PROCUREMENT STATUTES OR REGULATIONS. ANDOVER DATA
SERVICES, INC., B-209243, MAY 2, 1983, 83-1 CPD 465. HOWEVER, WE WILL
NOT REEVALUATE THE PROPOSAL IN QUESTION, AND THE FACT THAT A PROTESTER
DOES NOT AGREE WITH AN AGENCY'S EVALUATION DOES NOT ITSELF RENDER THE
EVALUATION UNREASONABLE. FRANK E. BASIL, INC.; JETS SERVICES, INC.,
B-208133, JANUARY 25, 1983, 83-1 CPD 91.
IN THIS INSTANCE, 4C WAS REPEATEDLY ADVISED DURING THE COURSE OF
NEGOTIATIONS THAT ITS CABLE INSTALLATION PLAN WAS UNSATISFACTORY BECAUSE
IT DID NOT PROPOSE TO REMOVE CERTAIN RACKS WHICH THE AIR FORCE FELT
REQUIRED REMOVAL IN ORDER TO FACILITATE THE INSTALLATION. WHILE 4C
"CLARIFIED" ITS INSTALLATION PLAN IN ITS BAFO, IT DID SO BY EXPLAINING
WHY IT BELIEVED THAT IT WAS UNNECESSARY TO REMOVE THE RACKS IN QUESTION.
IN OUR VIEW, THE AGENCY WAS ENTITLED TO INSIST ON THE METHODOLOGY WHICH
IT BELIEVED WAS REQUIRED TO SATISFY ITS MINIMUM NEEDS AND, HAVING SO
ADVISED 4C, IT REASONABLY COULD DOWNGRADE 4C'S BAFO FOR FAILURE TO
CONFORM TO THIS METHODOLOGY. MAREMONT CORPORATION, 55 COMP. GEN. 1362
(1976), 76-2 CPD 181. WE NOTE THAT THE DEGREE OF DOWNGRADING OF THE 4C
PROPOSAL IN THIS REGARD, WHILE NOT CHARACTERIZED AS A FINDING THAT 4C
WAS TECHNICALLY UNACCEPTABLE, IS TANTAMOUNT TO SUCH A FINDING. IN THIS
REGARD, 4C HAS ARGUED THAT SUCH A FINDING WAS UNWARRANTED BECAUSE ITS
PROPOSAL HAD BEEN PREVIOUSLY FOUND TO BE ACCEPTABLE DURING THE EARLIER
PHASES OF NEGOTIATION. WE DISAGREE WITH 4C ON THIS POINT. THE
INCLUSION OF 4C'S PROPOSAL IN THE COMPETITIVE RANGE SIMPLY INDICATED
THAT THERE WAS A REAL POSSIBILITY THAT IT COULD BE IMPROVED WITHOUT
MAJOR REVISIONS TO THE POINT WHERE IT BECAME ACCEPTABLE. PROPRIETARY
COMPUTER SYSTEMS, INC., 57 COMP.GEN. 800, 804 (1978), 78-2 CPD 212.
THUS, ALTHOUGH 4C WAS INCLUDED IN THE COMPETITIVE RANGE, WE NOTE THAT
THE PARTICULAR DEFICIENCY IN QUESTION WAS CONSISTENTLY DRAWN TO ITS
ATTENTION OVER THE COURSE OF THE NEGOTIATIONS, AND WE FIND NO EVIDENCE
THAT 4C'S TECHNICAL APPROACH IN THIS REGARD WAS EVER FOUND TECHNICALLY
ACCEPTABLE. ACCORDINGLY, THE AIR FORCE COULD REASONABLY HAVE CONCLUDED
THAT 4C'S BAFO WAS TECHNICALLY UNACCEPTABLE.
WITH RESPECT TO ITS ALLEGATION THAT THE AIR FORCE FAILED TO FOLLOW
THE EVALUATION CRITERIA, 4C POINTS TO THE AIR FORCE'S EVALUATION OF PAST
PERFORMANCE AS HAVING BEEN APPLIED INCONSISTENTLY TO ITSELF AND TO THE
AWARDEE. IN VIEW OF OUR FINDING THAT 4C'S PROPOSAL PROPERLY WAS FOUND
TECHNICALLY UNACCEPTABLE ON OTHER GROUNDS, WE NEED NOT ADDRESS THIS
ASPECT OF 4C'S PROTEST, SINCE IT COULD NOT HAVE PREJUDICED 4C.
METRIC'S PROTEST
METRIC'S PROPOSAL WAS FOUND BY THE SOURCE SELECTION AUTHORITY (SSA)
TO BE SUBSTANTIALLY EQUAL TO ADCOR'S IN ALL RESPECTS EXCEPT THAT METRIC
WAS FOUND TO POSE A HIGHER RISK BECAUSE OF ITS PAST PERFORMANCE RECORD
AND ITS LACK OF PRICE REALISM. IN MAKING THIS DETERMINATION, THE SSA
RELIED ON THE FINDINGS OF THE SOURCE SELECTION ADVISORY COUNCIL (SSAC),
WHICH, IN TURN, WERE BASED ON THE EVALUATIONS PERFORMED BY THE SOURCE
SELECTION EVALUATION BOARD (SSEB). SPECIFICALLY, THE SSAC HAD FOUND, IN
RELEVANT PART, THAT:
"C. IN THE MANUFACTURING/TECHNICAL AREA,
OFFERORS B METRIC AND D ADCOR WERE
EVALUATED AS MEETING STANDARDS (BLUE) WITH A
LOW RISK. THE REMAINING OFFERORS WERE
EVALUATED AS MARGINAL (YELLOW) WITH A HIGH
RISK.
"D. IN THE MANAGEMENT AREA ALL OFFERORS
WERE EVALUATED AS MEETING STANDARDS (BLUE).
OFFERORS A AND C WERE ASSESSED TO HAVE A
MODERATE RISK. ALL OTHER OFFERORS WERE
ASSESSED TO HAVE A LOW RISK.
"E. IN THE LOGISTICS AREA ALL OFFERORS
WERE EVALUATED AS MEETING STANDARDS (BLUE) WITH
A LOW RISK.
"F. IN THE ORDER OF LOWEST TO HIGHEST
BAFO PRICE, THE OFFERORS' BAFO PRICES AND GEMPC
GOVERNMENT ESTIMATE OF MOST PROBABLE COST RANGES ARE:
"BAFO GEMPC
OFFEROR A 20.7 20.9 - 22.5
OFFEROR E 21.0 24.5 - 28.4
OFFEROR B METRIC 22.9 22.7 - 23.6
OFFEROR F 26.9 28.3 - 31.0
OFFEROR G 27.0 23.0 - 25.2
OFFEROR C 27.4 25.6 - 29.5
OFFEROR D ADCOR 29.3 25.9 - 27.7
"G. THE PAST PERFORMANCE FOR THE OFFERORS
AND THEIR SUBCONTRACTORS WAS ASSESSED AS
SATISFACTORY, EXCEPT FOR OFFERORS C AND G.
BOTH OFFERORS, C AND G, HAVE A HISTORY OF LATE
DELIVERIES.
"H. PRE-AWARD SURVEYS RECOMMENDED FULL
AWARD FOR ALL OFFERORS EXCEPT C, F, AND G WHICH
RECEIVED A NO-AWARD RECOMMENDATION."
IN MAKING THESE FINDINGS, THE SSAC PERFORMED A COMPARATIVE ANALYSIS
OF THE OFFERORS' PROPOSALS WITH RESPECT TO ALL RELEVANT EVALUATION
CRITERIA. THE ANALYSIS SPECIFICALLY STATES THAT IT INCLUDES NOT ONLY
THE PROPOSALS, BUT ALSO THE FINDINGS OF THE EXPANDED PREAWARD SURVEY,
AND OFFERORS' RESPONSES DURING NEGOTIATIONS. THE ANALYSES OF ADCOR'S
AND METRIC'S PROPOSALS WERE IDENTICAL WITH RESPECT TO THE FACT THAT
NEITHER WAS CONSIDERED TO HAVE ANY WEAKNESSES IN MANUFACTURING/
TECHNICAL, MANAGEMENT AND LOGISTICS, AND BOTH WERE ASSESSED AS HAVING
LOW RISKS WITH RESPECT TO PERFORMANCE SCHEDULE AND COST WITHIN EACH OF
THE ABOVE THREE CRITERIA AREAS.
THE SSA REACHED THE CONCLUSION THAT METRIC'S PRICE WAS UNREALISTIC
AND CONSTITUTED A SUBSTANTIAL "RISK" BECAUSE IT WAS SUBSTANTIALLY BELOW
THE GOVERNMENT'S INDEPENDENT COST ESTIMATE (ICE). THE SSA STATED THAT:
"IN MAKING MY DECISION BETWEEN METRIC AND
ADCOR, I PLACED SUBSTANTIAL EMPHASIS IN
ACCORDANCE WITH PARAGRAPH 4.3 OF SECTION M ON
COST/PRICE REALISM AND CREDIBILITY AND A
COMPARISON OF THE PROPOSED PRICE TO THE
GOVERNMENT'S INDEPENDENT COST ESTIMATE (ICE).
ALTHOUGH ALL OF THE OFFERORS' PRICES WERE LESS
THAN THE ICE, THE AMOUNT OF THE DIFFERENCES
VARIED FROM $7 MILLION TO $17 MILLION. THE
CLOSENESS OF METRIC'S PRICE TO THE PRICES OF
TWO SLIGHTLY LOWER OFFERORS DID NOT, IN MY
JUDGMENT, ESTABLISH REALISM OR CREDIBILITY FOR
METRIC'S PRICE, SINCE THOSE OFFERORS' PROPOSALS
DID NOT ESTABLISH SOUND UNDERSTANDING AND
PROVEN CAPABILITY TO PERFORM THE IAC CONTRACT.
IN ADDITION, THREE OTHER OFFERORS' PRICES WERE
MUCH CLOSER TO ADCOR'S THAN TO METRIC'S. WHILE
SOME DIFFERENCES BETWEEN METRIC'S PRICE AND THE
$36 MILLION ICE ARE UNDERSTANDABLE, THE
MAGNITUDE OF THE DIFFERENCE OF $13.1 MILLION
COMPARED TO A TOTAL METRIC EVALUATED PRICE OF
$22.9 MILLION, AND THE CONCENTRATION OF THESE
DIFFERENCES IN THE IMPORTANT ELEMENTS OF TEST
AND PROGRAM MANAGEMENT, CAUSED ME TO CONCLUDE
THAT THE METRIC PRICE WAS NOT REALISTIC AND
REPRESENTED SUBSTANTIAL SCHEDULE AND PERFORMANCE
RISKS TO THE GOVERNMENT AND FINANCIAL RISK
TO METRIC. AFTER MANY YEARS OF EXPERIENCE WITH
GOVERNMENT INDEPENDENT COST ESTIMATES AND THE
RESULTS OF CONTRACT PERFORMANCE ON PROGRAMS FOR
WHICH SUCH ESTIMATES WERE MADE, MAY JUDGMENT WAS
AND IS THAT THE PROBABILITY OF THE ICE BEING
$13 MILLION ABOVE A REALISTIC PRICE FOR SOUND,
TIMELY PERFORMANCE IS VIRTUALLY ZERO."
METRIC ARGUES ESSENTIALLY THAT THE ICE WAS INACCURATE, POINTING OUT
THAT IT WAS REPEATEDLY CHANGED, AND THAT IT WAS PREPARED FOR LARGE
BUSINESSES, WHICH HAVE HIGHER OVERHEAD COSTS, AND CONTENDS THAT THIS
INACCURACY IS BORNE OUT BY THE PRICES OF THE OFFERORS WHICH WERE,
WITHOUT EXCEPTION, SUBSTANTIALLY BELOW THE ICE.
IN OUR VIEW, WHILE THE RFP DID INDICATE THAT PRICES WOULD BE COMPARED
WITH THE ICE, THE RFP DID NOT STATE THAT PRICE REALISM WOULD BE JUDGED
SOLELY ON THIS COMPARISON. WE FIND THAT THE AIR FORCE'S OWN FINDINGS
SHOW BOTH THAT THE ICE WAS INACCURATE, AND THAT IT FOUND THE METRIC
PRICE WAS REALISTIC. IN PARTICULAR, THE AIR FORCE CONCEDES THAT THE ICE
WAS OVERSTATED BY $3 TO $4 MILLION BECAUSE OF OVERESTIMATED TESTING
REQUIREMENTS. MOREOVER, AS NOTED ABOVE, THE SSAC REPORT CONTAINS AN
EVALUATION OF EACH PROPOSAL WITH RESPECT TO ITS BAFO PRICE COMPARED WITH
THE GOVERNMENT ESTIMATE OF MOST PROBABLE COST (GEMPC). METRIC'S PRICE
OF $22.9 MILLION FELL WITHIN THE GEMPC RANGE OF $22.7 TO $23.6 MILLION.
THE SSAC CONCLUDED, AS A RESULT, THAT "THE ONLY COST/ RISK IDENTIFIABLE
IS IN THE FACT THAT IN THE OFFEROR'S LABOR HOURS HIS COST MAY VARY IN A
RANGE OF AN UNDERESTIMATE OF $.7M TO AN OVERESTIMATE OF .2M." THE SSAC
FURTHER CONCLUDED WITH RESPECT TO THE FINANCIAL RISK TO METRIC THAT:
"BASED ON THE FACT THAT A FIRM FIXED PRICE CONTRACT (WITH ECONOMIC PRICE
ADJUSTMENT PROVISIONS) WILL BE AWARDED, AND BASED UPON A COMPARATIVE
ANALYSIS OF THE ABOVE CITED COST RISKS VERSUS THE DETAILED DESCRIPTION
OF THE OFFEROR'S FINANCIAL STATUS PROVIDED BY DCASMA *** THE FINANCIAL
RISK TO METRIC IS ASSESSED TO BE LOW." THE SSAC REACHED A SIMILAR
CONCLUSION THAT THE FINANCIAL RISK TO ADCOR WAS LOW. HOWEVER, ADCOR'S
BAFO PRICE WAS FOUND TO EXCEED THE GEMPC BY $3.4 TO $1.6 MILLION BECAUSE
OF OVERESTIMATES OF LABOR HOURS.
IN ADDITION, AS DETAILED ABOVE, THE SPECIFIC EVALUATION OF METRIC
WITH RESPECT TO THE STATED EVALUATION CRITERIA BASICALLY CONTRADICTS THE
SSA'S CONCLUSION THAT METRIC'S PRICE WAS UNREALISTIC. IN THIS REGARD,
THE SSAC EVALUATED METRIC AS ACCEPTABLE, HAVING SPECIFICALLY CONCLUDED
THAT IT OFFERED A LOW RISK FACTOR IN THE RELEVANT CRITERIA AREAS.
HAVING FURTHER EVALUATED METRIC'S PROPOSAL COSTS AS FALLING WITHIN THE
GEMPC RANGE, THE SSAC, IN EFFECT, MADE A FINDING THAT METRIC OFFERED A
PLAN WHICH WAS RATED EQUAL TO THAT OF ADCOR'S UNDER THE EVALUATION
CRITERIA AND WHICH WAS FURTHER EVALUATED TO HAVE BEEN BASED ON ACCURATE
COST ESTIMATES OF THAT PLAN.
IN SUM, THE AIR FORCE HAS CONCEDED THE INACCURACY OF THE ICE.
MOREOVER, THE SSAC'S ANALYSIS OF THE TWO PROPOSALS VERSUS THE GEMPC
SHOWS THAT METRIC'S PRICE FELL WITHIN THE RANGE OF THE GOVERNMENT
ESTIMATE AND WAS CONSIDERED TO POSE A LOW FINANCIAL RISK. NEVERTHELESS,
IT APPEARS THE SSA'S SELECTION PLACED UNDUE IMPORTANCE ON THE ICE AND
GAVE LITTLE CONSIDERATION TO THE FACT THAT THE PROPOSALS WERE
ESSENTIALLY EQUAL TECHNICALLY AND THE SSAC RATED METRIC'S COST RISK LOW.
IN OUR VIEW, THE SSA DID NOT HAVE A REASONABLE BASIS FOR HIS CONCLUSION
THAT METRIC'S PROPOSAL WAS SIGNIFICANTLY WORSE THAN ADCOR'S WITH RESPECT
TO COST REALISM.
REGARDING THE PAST PERFORMANCE RECORD, METRIC CONTENDS THAT THE AIR
FORCE FINDING IS, IN EFFECT, A NONRESPONSIBILITY DETERMINATION WHICH
SHOULD HAVE BEEN REFERRED TO SBA FOR COC CONSIDERATION, SINCE METRIC IS
A SMALL BUSINESS. IN THIS REGARD, WE NOTE THAT SECTION "L" OF THE RFP
EXPRESSLY STATED:
"EVALUATION OF PAST PERFORMANCE
"OFFERORS ARE ADVISED THAT THEIR PAST
PERFORMANCE ON SIMILAR CONTRACTS WILL BE AN
EVALUATION CRITERION IN THE EVALUATION AND
SELECTION OF A SOURCE FOR THE IAC ACQUISITION.
THE RELATIVE IMPORTANCE OF PAST PERFORMANCE FOR
ANY GIVEN AREA, ITEM OR FACTOR IS AS SPECIFIED
IN SECTION M OF THIS RFP. BOTH GENERAL AND
SPECIFIC CONSIDERATIONS OF PAST PERFORMANCE
WILL BE EVALUATED FOR EACH ITEM OR FACTOR WITHIN
AN AREA AS SPECIFIED. GENERAL CONSIDERATIONS
ARE ASPECTS OF PAST PERFORMANCE CONSIDERED
BY THE AIR FORCE WHICH ARE NOT PROVIDED
WITH AN OFFEROR'S PROPOSAL. SPECIFIC CONSIDERATIONS
ARE THOSE ASPECTS OF PAST PERFORMANCE
CONTAINED IN THE OFFEROR'S PROPOSAL AND
DIRECTLY RELATED TO THE WORK TO BE PERFORMED. ***."
THE AIR FORCE CONTENDS THAT THE PAST PERFORMANCE EVALUATION DID NOT
CONSTITUTE A NONRESPONSIBILITY DETERMINATION AND THAT REFERRAL TO SBA
WAS NOT REQUIRED.
THE EVALUATION CRITERIA MAKE IT CLEAR THAT PAST PERFORMANCE WAS
INCLUDED WITHIN THE EVALUATION FACTORS AND IT IS PERMISSIBLE TO CONSIDER
RESPONSIBILITY RELATED FACTORS AS A MEASURE OF THE TECHNICAL
ACCEPTABILITY OF A PROPOSAL IN NEGOTIATED PROCUREMENTS OF THIS TYPE.
NEW YORK UNIVERSITY, B-195792, AUGUST 18, 1980, 80-2 CPD 126. MOREOVER,
WE HAVE EXPRESSLY HELD THAT IF A SMALL BUSINESS IS FOUND TECHNICALLY
DEFICIENT UNDER THESE CIRCUMSTANCES THE COC PROCEDURES ARE NOT
APPLICABLE. ANDERSON ENGINEERING AND TESTING COMPANY, B-208632, JANUARY
31, 1983, 83-1 CPD 99.
HOWEVER, WE DO NOT THINK THAT THE SSA COULD REASONABLY CONSIDER PAST
PERFORMANCE AS AN INDEPENDENT EVALUATION CRITERIA IN THE MANNER WHICH HE
APPEARS TO HAVE DONE. THAT IS, ALL FOUR OF THE STATED EVALUATION
CRITERIA SPECIFICALLY TAKE INTO CONSIDERATION PAST PERFORMANCE AS A
SUBFACTOR. THE RFP NOTE REGARDING PAST PERFORMANCE QUOTED EARLIER ALSO
MAKES IT CLEAR THAT PAST PERFORMANCE WILL BE CONSIDERED WITHIN EACH OF
THE FOUR AREAS, NOT AS A SEPARATE CRITERION. THE SSAC EVALUATION WHICH
FOUND THE ADCOR AND METRIC PROPOSALS ESSENTIALLY TECHNICALLY EQUAL HAD
ALREADY TAKEN INTO CONSIDERATION THE OFFERORS' PAST PERFORMANCE, AS
STATED IN THE CRITERIA.
IN SHORT, THE RECORD SHOWS THAT THE PROPOSALS WERE ESSENTIALLY EQUAL
TECHNICALLY, WHILE METRIC'S PRICE WAS APPROXIMATELY $7 MILLION LOWER
THAN ADCOR'S. SINCE 10 U.S.C. SEC. 2304(G) (1982) REQUIRES THAT COST
MUST BE ACCORDED SOME CONSIDERATION IN NEGOTIATED PROCUREMENTS, EVEN
WHERE PRICE IS STATED IN THE EVALUATION CRITERIA TO BE OF LESSER
IMPORTANCE THAN OTHER EVALUATION CRITERIA, WE DO NOT FIND THAT THE AIR
FORCE HAD A REASONABLE BASIS FOR ITS DECISION TO AWARD TO ADCOR. SEE
WISMER AND BECKER CONTRACTING ENGINEERS ET AL., B-191756, MARCH 6, 1979,
79-1 CPD 148.
ACCORDINGLY, WE SUSTAIN METRIC'S PROTEST AND DENY 4C'S PROTEST.
IN THIS SITUATION, WE WOULD ORDINARILY RECOMMEND THAT NEGOTIATIONS BE
REOPENED TO PROPERLY EVALUATE METRIC'S PROPOSAL, THAT IS, GIVE
APPROPRIATE WEIGHT TO THE APPROXIMATELY $7 MILLION COST SAVINGS
INVOLVED, WITH A VIEW TO TERMINATING ADCOR'S CONTRACT AND MAKING AWARD
TO METRIC IF ITS PROPOSAL WAS DETERMINED SUPERIOR. HOWEVER, WE DO NOT
BELIEVE THAT THIS WOULD BE APPROPRIATE UNDER THE CIRCUMSTANCES HERE.
ADCOR HAS SUBSTANTIALLY PERFORMED THE BASE CONTRACT AND ONE OF THE
OPTIONS HAS BEEN EXERCISED. IN ADDITION, IT APPEARS THAT IT MAY WELL NOT
BE FEASIBLE TO SEPARATELY COMPETE THE OTHER OPTIONS IN VIEW OF THE
COMPLETION OF THE BASE CONTRACT, SINCE THEY ARE INTERRELATED PARTS OF
THE TOTAL IAC PACKAGE.
HOWEVER, UNDER THE CIRCUMSTANCES, WE BELIEVE THAT METRIC IS ENTITLED
TO RECOVER THE COSTS OF PREPARING ITS PROPOSAL. THESE COSTS ARE
RECOVERABLE WHERE THE GOVERNMENT ACTED ARBITRARILY AND CAPRICIOUSLY WITH
RESPECT TO A PROPOSAL AND THE OFFEROR HAD A SUBSTANTIAL CHANCE OF
RECEIVING THE AWARD EXCEPT FOR THE AGENCY'S IMPROPER ACTION. SEE M.L.
MACKAY & ASSOCIATES, INC., B-208827 JUNE 1, 1983, 83-1 CPD 587.
HERE, THE AIR FORCE UNREASONABLY CONSIDERED PAST PERFORMANCE AS A
SEPARATE CRITERION, AND THE SELECTION OFFICIAL MADE FINDINGS IN THIS
REGARD WHICH CONTRADICT THE UNDERLYING TECHNICAL EVALUATION. IN
ADDITION, THE AIR FORCE DOWNGRADED METRIC FOR PRICE RISK IN THE FACE OF
A TECHNICAL EVALUATION AND A SPECIFIC COST EVALUATION WHICH SHOWED THAT
METRIC COULD PROVIDE PERFORMANCE AT A LEVEL EQUAL TO THE AWARDEE'S AND
AT A SIGNIFICANTLY LOWER COST. IN VIEW OF THE APPARENT TECHNICAL
EQUALITY OF THE TWO PROPOSALS AND THE SIGNIFICANT COST ADVANTAGE OF
METRIC'S PROPOSAL, WE BELIEVE IT IS FAIR TO SAY THAT METRIC HAD A
SUBSTANTIAL CHANCE FOR AWARD. WE THEREFORE BELIEVE THAT THE PROTESTER
SHOULD BE ENTITLED TO RECEIVE ITS PROPOSAL PREPARATION COSTS. METRIC
SHOULD SUBMIT DOCUMENTATION TO SUPPORT ITS COSTS TO THE AGENCY.