BNUMBER: B-281487
DATE: February 16, 1999
TITLE: Mail Boxes Etc., B-281487, February 16, 1999
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Matter of:Mail Boxes Etc.
File:B-281487
Date:February 16, 1999
Jane Walters for the protester.
Kerry L. Miller, Esq., Government Printing Office, for the agency.
Aldo A. Benejam, Esq., and Christine S. Melody, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
Agency reasonably determined that protester was nonresponsible based
upon conclusion that protester lacked equipment necessary to perform
the contract where protester failed to provide sufficient evidence to
show that it had or could obtain the required equipment in time to
meet the solicitation's delivery schedule.
DECISION
Mail Boxes Etc. (MBE) protests the determination by the Government
Printing Office (GPO) that it is nonresponsible under invitation for
bids (IFB) No. 2085S for electrostatic copying services for the
Department of Agriculture, the U.S. Forest Service, and various other
agencies located in the Juneau, Alaska area. MBE argues that the
nonresponsibility determination lacks a reasonable basis.
We deny the protest.
The IFB contemplated the award of a fixed-price, indefinite-delivery,
indefinite-quantity requirements contract for copying services. IFB
at 4. The successful bidder is to produce flat forms and books
requiring such operations as electrostatic, thermal or other copying
process, color copying, binding, packing, labeling, and delivery. Id.
at 6. The IFB estimated an average of 42 orders each month, with as
many as 10 orders placed in one day, for approximately 504 orders
annually. Id. The IFB also listed estimated quantities of copies per
order, ranging from 20 to 2,000 copies per order of flat forms and
from 1 to 3,000 copies per order of books. Id.
MBE submitted the low bid by the October 15, 1998 bid opening date.
In order to make a responsibility determination, the contracting
officer (CO) requested that MBE provide a list of all of its equipment
and suppliers, as well as information regarding the firm's financial
resources. In response, MBE provided GPO with the requested
information, including a list of its equipment which MBE set out under
two categories: "EQUIPMENT ON PREMISES" and "EQUIPMENT ON ORDER/READY
TO BE SHIPPED." MBE provided no further details or explanation
regarding the equipment it identified as being "on order."
The CO reviewed MBE's response and concluded that MBE did not have the
necessary equipment on hand to perform the contract and had not
provided any evidence of its ability to obtain the necessary equipment
in sufficient time to begin performance in accordance with the IFB's
schedule.[1] In a letter received by MBE on October 22, the CO
informed MBE that the firm was considered nonresponsible because it
did not currently have all of the equipment on hand necessary to
perform the contract. Specifically, the CO's letter informed MBE that
the firm was found nonresponsible[2] because the firm had not
performed any GPO contracts; that its equipment was on order
contingent upon MBE receiving the award; and that it could not be
determined exactly when the equipment would be installed and ready for
use in performing the contract. On October 22, MBE filed an
agency-level protest, and before the CO could issue a decision on that
protest, MBE filed the instant protest in our Office.
The GPO's Printing Procurement Regulations (PPR) require the CO to
make an affirmative determination that a firm is responsible before
awarding a contract to that firm. PPR I-5.1. In order to receive a
favorable responsibility rating, an offeror must meet several minimum
standards applicable to the procurement, including having a
satisfactory record of performance regarding both quality and
timeliness on previously-awarded contracts, and possessing, or having
the ability to obtain, the necessary equipment, technical skills, and
productive capacity to perform the contract. PPR I-5.4(iii) and (iv).
The PPR specifically state that prospective contractors must
affirmatively demonstrate that they are responsible through
satisfactory performance on prior similar contracts or by presenting
evidence of their ability to satisfy the contract requirements. PPR
I-5.5. The PPR require that the CO make a nonresponsibility
determination if, based on the available information, there is no
clear indication that the prospective contractor meets those minimum
standards. PPR I-5.6. The CO is required to determine a firm
nonresponsible where there is doubt as to the offeror's productive
capability which cannot be resolved affirmatively. Id.
The CO is vested with broad discretion in exercising his or her
business judgment in making a nonresponsibility determination.
Document Printing Serv., Inc., B-256654, B-257051, July 8, 1994, 94-2
CPD para. 13 at 3. Our Office generally will not disturb a
nonresponsibility determination unless a protester can show either
that the procuring agency had no reasonable basis for the
determination or that it acted in bad faith. Id. In our review of
nonresponsibility determinations, we consider only whether the
negative determination was reasonably based on the information
available to the CO at the time it was made. Id. at 4. Based on our
review of the record here, we think that the CO's nonresponsibility
determination is reasonably supported.
The CO's determination that MBE is nonresponsible was primarily based
on his finding that MBE lacked the necessary equipment to perform the
contract. Specifically, the CO explained in his findings and
determination that the IFB's specifications require that the
contractor's copy equipment be able to accept electronic storage media
such as "imoega Zip and Jaz disks and 3/4" floppy disks," and also
have the ability to accept and send "FTP files and CDs." CO's
Findings and Determination, Oct. 21, 1998. The CO found that MBE's
equipment lacked these capabilities. The CO further noted that MBE
indicated that it had a variety of equipment required to perform the
contract "on order," contingent upon award of the contract. The CO
explained, however, that, even if awarded the contract, "[MBE] will
not have this equipment in place and running for at least another week
and therefore would not be prepared to perform [the contract]." Id.
The CO further explained in his findings and determination that he did
not believe that MBE could be ready to perform the contract within 1
week of award since the equipment that MBE identified as being "on
order" had to be installed, and MBE's personnel would require training
on the new equipment. Id.
In our view, the CO's nonresponsibility determination is reasonably
supported by the record. The IFB stated that deliveries under the
contract must be made within 1 to 10 workdays, with the majority of
deliveries required within 1 to 5 days. IFB at 10. Additionally, the
IFB stated that approximately two percent of the orders would require
same-day delivery. Id. MBE does not dispute the CO's finding that it
lacked all of the equipment required to meet the IFB's delivery
schedule, and does not take issue with the CO's conclusion that the
equipment it did have available did not have the required
capabilities. Further, MBE does not disagree with the CO's
determination that the equipment it had identified as being "on order"
would require at least 1 week to deliver and install, and that its
personnel would require training in the use of that equipment.
Clearly, if MBE did not have all of the required equipment on hand to
begin performance, it could not meet the IFB's relatively short
delivery schedule if awarded the contract. Based on the information
available to him at the time, the CO reasonably determined that MBE
was nonresponsible.
MBE argues that the CO's determination was not reasonable because "no
pre-award survey was ever conducted" and because the CO did not make
further inquiries to obtain detailed information "about the status and
shipping arrangements that MBE had in place . . . ." MBE also
maintains that the CO should have asked for "clarification or even
additional information if he had doubts" about the information MBE had
provided.[3] Comments at 2-3.
The protester's arguments are without merit. A pre-award survey is
not a legal prerequisite to a responsibility determination; COs have
broad discretion concerning whether to conduct such surveys and may
use, as was done here, other information available to them concerning
a firm's responsibility. See Mine Safety Appliances Co., B-266025,
Jan. 17, 1996, 96-1 CPD para. 86 at 5. In any event, given that MBE did
not have at its facility all of the equipment required to perform the
contract, and the equipment it did have did not have the required
capabilities, we fail to see, and the protester does not explain, how
an on-site pre-award survey of MBE would have affected the CO's
nonresponsibility determination.
Further, as already explained, the burden is on the prospective
contractors to affirmatively demonstrate that they are responsible
through the satisfactory performance on prior similar contracts or by
presenting evidence of their ability to satisfy the contract
requirements. PPR I-5.5. Here, there is no evidence in the record
showing, and the protester does not contend, that MBE had previously
performed any similar contracts. In addition, the record shows that
except for submitting a list of the equipment it identified as being
"ON ORDER/READY TO BE SHIPPED," MBE provided no evidence to the CO
that it had entered into any sales agreement or lease arrangement
showing that it could obtain the equipment required to perform the
contract; nor did MBE provide any explanation about any shipping
arrangements MBE alleges it "had in place."[4] Contrary to the
protester's suggestion, there is no legal requirement for the CO to
obtain additional information or seek clarification about the firm's
ability to obtain the required equipment.
In sum, we conclude that the CO reasonably determined that MBE was
nonresponsible based on the lack of evidence showing that MBE was
capable of obtaining the equipment required in sufficient time to meet
the solicitation's delivery schedule.
The protest is denied.
Comptroller General
of the United States
1. The IFB stated that GPO contemplated making a single award for a
base year from October 1, 1998 to September 30, 1999, with up to three
1-year option periods. The IFB stated that deliveries under the
contract must be made within from 1 to 10 workdays, with the majority
of deliveries required from 1 to 5 days. Approximately 2 percent of
the orders would require same-day delivery. IFB at 10.
2. Despite MBE's status as a small business concern, the
nonresponsibility determination was not referred to the Small Business
Administration because GPO is a legislative agency and is not subject
to the referral requirements of the Small Business Act, 15 U.S.C. sec.
637(b)(7) (1994). See Fry Communications, Inc., B-207605, Feb. 1,
1983, 83-1 CPD para. 109 at 2-5.
3. MBE also argues that the CO's determination was made in bad faith.
However, to show bad faith there must be a showing that the agency
intended to harm the protester. Complere Inc., B-257946, Nov. 23,
1994, 94-2 CPD para. 207 at 4. MBE has made no such showing.
4. After GPO found MBE nonresponsible, several of MBE's suppliers
submitted letters to the CO indicating their willingness and apparent
capability to perform various services in support of MBE if it was
awarded the contract. These letters, however, were not submitted in
response to the CO's request that MBE provide evidence of its
responsibility. In any event, they are not legally binding
contractual arrangements with MBE which the CO would have been
required to accept as evidence that MBE could obtain the equipment
necessary to perform the contract.