BNUMBER:  B-262057
DATE:  November 16, 1995
TITLE:  Qualimetrics, Inc.

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Matter of:Qualimetrics, Inc.

File:     B-262057

Date:   November 16, 1995

Cyrus E. Phillips IV, Esq., Kilcullen, Wilson and Kilcullen, for the 
protester.
David L. Frecker, Esq., General Services Administration, for the 
agency.
Charles W. Morrow, Esq., and James A. Spangenberg, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Where an agency fails to effectively solicit an incumbent contractor 
because the solicitation was sent to the former address of the 
contractor, and where the agency  had been advised, under Federal 
Acquisition Regulation subpart 42.12, prior to the issuance of the 
solicitation, that the contractor had executed a novation agreement 
approved by another agency and of the correct address of the successor 
contractor, the agency has not satisfied its obligation under the 
Competition in Contracting Act of 1984 to obtain full and open 
competition.

DECISION

Qualimetrics, Inc. protests the failure of the General Services 
Administration (GSA) to solicit it under request for proposals (RFP) 
No. FCGR-95-0002-B, for non-mandatory, multiple award federal supply 
schedule (FSS) contracts encompassing various instruments and 
laboratory equipment.

We sustain the protest.

On February 16 and March 17, 1995, GSA published in the Commerce 
Business Daily (CBD) notices of the RFP.  The RFP was issued on April 
5 requesting proposals for non-mandatory, multiple award schedule 
contracts covering Federal Supply Classification (FSC) group 66, part 
II, section Q, "Instruments and Laboratory Equipment:  Environmental 
Sampling and Analysis Equipment (Geophysical, Oceanographic and 
Meteorology (Weather) Instruments); and Surveying Instruments and 
Systems," for a contract period commencing on December 1, 1995, or 
date of award, whichever is later, through November 30, 2000.[1]  
Based upon its mailing list and requests pursuant to the CBD 
announcement, GSA sent the RFP to 230 firms.[2]  GSA mailed a copy of 
the RFP to Qualimetrics,[3] an incumbent contractor under the current 
FSS contract for this FSC group, to an address in Baldwin, Maryland, 
where Qualimetrics formerly maintained a sales office.[4]  

At the time the FSS contract was executed in January 1992, 
Qualimetrics was a wholly owned subsidiary of Dynatech Corporation of 
Massachusetts.  Dynatech, Qualimetrics, and the Federal Aviation 
Administration (FAA), the responsible agency for which Qualimetrics 
performed the most work, executed a novation agreement,[5] effective 
September 30, 1994, whereunder all the assets and rights of that firm 
were transferred from Dynatech to QSJJ, Inc., which continues to do 
business as Qualimetrics at the Sacramento address.  The novation 
agreement specifically recognized Qualimetrics as the successor in 
interest for various contracts, including an FAA contract and 
Qualimetrics's FSS contract.

Pursuant to FAR  42.1202 and 42.1203, the FAA was responsible for 
processing and executing Qualimetrics's novation agreement, which 
included informing GSA of the proposed agreement and obtaining that 
agency's consent to the terms and conditions of the novation.  By 
letter dated December 21, the FAA sent GSA notice of Qualimetrics's 
novation agreement, asking for GSA's comments within 30 days and 
stating that no response would be taken as consent; this letter 
identified Qualimetrics as being located in Sacramento.  Enclosed with 
this letter were the executed novation agreement as well as a proposed 
implementing modification to the primary FAA contract, which 
identified Qualimetrics as the successor contractor at the Sacramento 
address.[6]
  
Numerous firms submitted proposals by the May 16 closing date.  
Qualimetrics did not receive a copy of the solicitation that was sent 
to the closed Maryland office address, and first learned of the RFP 
when it contacted GSA in June regarding the resolicitation of its FSS 
contract that was scheduled to expire on November 30, 1995.  GSA has 
declined to reopen the RFP to allow Qualimetrics to submit a proposal, 
arguing that the protester should have notified GSA that its address 
had changed.  No awards have been made under this RFP.  

The Competition in Contracting Act of 1984 (CICA), 41 U.S.C.  
253(a)(1)(A), requires contracting agencies to obtain full and open 
competition through the use of competitive procedures.  "Full and open 
competition" is obtained where all responsible sources are permitted 
to submit sealed bids or competitive proposals. 41 U.S.C.  403(6).  
GSA's solicitations for multiple award schedule FSS contracts are 
required to be conducted under "full and open competition" and to 
assure that "participation has been open to all responsible sources."  
See 41 U.S.C.  259(b)(3).  

In seeking to achieve full and open competition, it is a contracting 
agency's affirmative obligation to use reasonable methods for the 
dissemination of solicitation documents to prospective contractors.  
Professional Ambulance Inc., B-248474, Sept. 1, 1992, 92-2 CPD  145.  
Solicitation mailing lists are required to be maintained by 
contracting activities, and are to include those firms considered 
capable of filling agency requirements; normally solicitations are to 
be sent to those firms on the lists.  FAR  14.203-1, 14.205-1, and 
15.403.  Although the FAR permits agencies to rotate names on a list 
so that not all those on an excessively lengthy list need be solicited 
for every procurement (except small business concerns), the regulation 
specifically provides that where agencies rotate names they must 
solicit the "previously successful bidder."  FAR  14.205-4(b).  Thus, 
agencies are generally required to solicit their incumbent contractors  
in order to satisfy the CICA mandate for full and open competition.  
Davis Enter., B-249514, Dec. 4, 1992, 92-2 CPD  389; Pratt & Lambert, 
Inc., B-245537; B-245538, Jan. 9, 1991, 92-1 CPD  48; United States 
v. Thorson Co., 806 F.2d 1061 (Fed. Cir. 1986); Abel Converting, Inc. 
v. United States, 679 F. Supp. 1133 (D.D.C. 1988).  An agency does not 
satisfy this mandate where it fails to effectively solicit an 
incumbent contractor because it misaddressed the solicitation, even if 
this was done inadvertently.  Professional Ambulance Inc., supra; 
Lewis Jamison Inc. Assocs., B-252198, June 4, 1993, 93-1 CPD  433.

The record here shows that the agency reasonably should have been 
aware that Qualimetrics's Maryland address may no longer be valid and 
that its address was that in Sacramento.  Months before the 
solicitation was issued, the same GSA contracting officer as was 
responsible for the mailing list for this RFP was apprised of the 
completed novation and was provided documents, i.e., the proposed 
contract modification, designating Qualimetrics's Sacramento address 
as that of the successor contractor.[7]  Under the circumstances, GSA 
should have verified its mailing list to assure that the address of 
Qualimetrics's successor was on it.[8]  See Holiday Inn-Laurel, 
B-249673.2, Dec. 22, 1992, 92-2 CPD  428.  

GSA asserts that Qualimetrics was on constructive notice of this RFP 
by virtue of the CBD announcements, and that the paramount reason that 
Qualimetrics was not solicited was because it did not make an early 
request for a copy of the solicitation, and did not notify GSA that 
its address had changed.  While prospective contractors should avail 
themselves of every reasonable opportunity to obtain solicitation 
documents, see NRC Data Sys., 65 Comp. Gen. 735 (1986), 86-2 CPD  84; 
Sentinel Sec. & Patrol Servs., B-261018, Aug. 9, 1995, 95-2 CPD  67, 
under the circumstances, Qualimetrics reasonably assumed that no 
action on its part was necessary.  First, publication in the CBD is 
not sufficient notification to an incumbent that reasonably expects to 
be considered for the new contract and to receive the solicitation.  
See Davis Enters., supra; Professional Ambulance Inc., supra.  Second, 
as noted above, we think the agency reasonably should have been aware 
of Qualimetrics's new address for purposes of mailing the 
solicitation.  In this regard, FAR subpart 42.12 places the 
responsibility for advising affected agencies of a novation on the 
"responsible contracting officer," and this subpart places no 
responsibility on the contractor for advising affected agencies.  
Qualimetrics could reasonably assume that these procedures had been 
followed; indeed, the FAA's responsible contracting officer did in 
fact advise GSA of the novation and identified the successor 
contractor with its address.  Further, as also noted above, 
Qualimetrics itself had made GSA aware of its new address by means of 
price lists furnished under its current FSS contract.  We conclude 
that it was GSA's failure to incorporate Qualimetrics's new address in 
its bidders' list, not some failure by Qualimetrics, which most 
directly led to Qualimetrics's exclusion from the competition.  This 
failure violated FAR  14.205(b) and the CICA mandate to obtain full 
and open competition.  See id.

GSA also asserts that any failure to properly solicit an incumbent 
contractor does  not require corrective action because numerous 
proposals were received in response to the RFP, so as to assure fair 
and reasonable prices.  This argument fails to consider the nature of 
this multiple award FSS solicitation, which requested prices for a 
multiplicity of items.  GSA does not argue, nor does the record 
indicate, that any other offeror proposed to supply the identical 
equipment that Qualimetrics manufactures and is providing under its 
current FSS contract.  Moveover, there is no reason to believe that 
Qualimetrics would not receive a contract to supply the items it 
manufactures, if its proposal were considered and its prices were 
reasonable.  Therefore, the receipt of numerous proposals under this 
RFP is neither relevant in determining whether the agency received the 
most advantageous price for the equipment that Qualimetrics 
manufactures, nor provides any basis for not allowing that firm an 
opportunity to compete.  Moreover, we fail to perceive any prejudice 
to the other offerors, which do not supply Qualimetrics's equipment, 
in allowing Qualimetrics to now submit a proposal.

We recommend that GSA allow Qualimetrics to submit an offer.  
Qualimetrics also is entitled to recover the cost of filing and 
pursuing the protest. 4 C.F.R  21.6(d)(1) (1995).  Qualimetrics 
should submit its certified claim for costs directly at the agency 
within 60 days of receiving this decision.  4 C.F.R.  21.6(f)(1) .

The protest is sustained.

Comptroller General
of the United States

1. Non-mandatory, multiple award FSS contracts are indefinite delivery 
contracts for commercial firms to provide government agencies with a 
variety of commonly used goods and services at stated prices for given 
periods of time.  Government ordering activities can order goods or 
services under simplified procedures from the contracts to meet their 
requirements.  In this case, the RFP, which encompasses a wide variety 
of equipment, contemplates multiple awards to responsible offerors 
whose offers are found most advantageous to the government 
considering, among other things, the "multiplicity and complexity" of 
the equipment offered, and price.  The RFP further advises prospective 
contractors that "by providing a selection of comparable supplies or 
services, ordering activities will be afforded the opportunity of 
fulfilling their requirements with the lowest cost item having the 
features which specifically meet their needs."  The RFP also provides 
that only one contract will be awarded for each specific product, and 
that where multiple suppliers (regular dealers) offer the "identical" 
product, only the lowest-priced supplier will receive a contract for 
that product. 

2. In addition, GSA publicly posted the RFP.   

3. Qualimetrics manufactures microprocessor-based weather 
instrumentation, in particular, a "type-approved automated weather 
observing systems."  

4. This was the address used by Qualimetrics as a subsidiary of 
Dynatech when it first entered into the FSS contract in 1992.  
Qualimetrics's primary office with regard to weather instrumentation 
was and is located in Sacramento, California.  The price lists 
provided to GSA by Qualimetrics during the FSS contract showed the 
firm's address in Sacramento. 

5. A novation agreement is a "legal instrument executed by (a) the 
contractor (transferor), (b) the successor in interest (transferee), 
and (c) the government by which, among other things, the transferor 
guarantees performance of the contract, the transferee assumes all 
obligations under the contract, and the government recognizes the 
transfer of the contract and related assets."  Federal Acquisition 
Regulation (FAR)  42.1201.

6. Although  in February 1995 GSA requested the FAA to provide the 
executed modification recognizing the novation, the executed 
modification to the FAA contract dated February 17 was not provided to 
GSA until June 22.  On July 19 (after this protest was filed), GSA 
executed a modification to the FSS contract recognizing the novation 
and changing Qualimetrics's official address to that in Sacramento.   

7. While the FAA did not advise GSA that this represented a change of 
address with regard to the FSS contract (because the predecessor 
Qualimetrics contractor for FAA had the same Sacramento address), the 
letter stated that Qualimetrics was located in Sacramento and the 
draft modification showed an address of the successor Qualimetrics 
that was different than the Maryland address identified on GSA's 
mailing list.  Even though GSA was unable to promptly obtain the 
executed modification to the FAA contract recognizing the novation, 
GSA only modified the contract to recognize the novation after this 
protest was filed, notwithstanding that GSA had been advised that the 
novation was effective more than 9 months earlier.

8. While GSA contends that Qualimetrics did not return certain 
telephone calls it made to Qualimetrics's Sacramento office in late 
March 1995, the record indicates that these calls were in response to 
earlier calls initiated by Qualimetrics concerning possibly adding 
items to its current FSS contract.  There is no evidence that the 
calls concerned the novation.