South Texas Turbine Supply

B-272163 Sep 05, 1996 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Notwithstanding the fact that the proposed debarment is lifted prior to award. A contracting agency may not award a contract to a firm alleged to be an affiliate of such a contractor unless it has determined that the firms are not affiliated. Issued by the Defense Logistics Agency's Defense Reutilization and Marketing Service (DRMS). [1] South Texas principally argues that Sierra is affiliated with a firm that was proposed for debarment at the time of bid opening. Consequently is ineligible for award. Aircraft parts that are no longer needed by the government. Which states that award will be made to the responsible bidder whose conforming bid is most advantageous to the government. Is price. View Decision Matter of: South Texas Turbine Supply File: B-272163 Date: September 5, 1996 Since the requirement to reject the bid of a contractor proposed for debarment at the time of bid opening--notwithstanding the fact that the proposed debarment is lifted prior to award--extends to any of that contractor's affiliates, a contracting agency may not award a contract to a firm alleged to be an affiliate of such a contractor unless it has determined that the firms are not affiliated. Attorneys DECISION South Texas Turbine Supply protests the proposed award of a contract to Sierra Sales Corporation under the invitation for bids covering Sale No. 31-6317, issued by the Defense Logistics Agency's Defense Reutilization and Marketing Service (DRMS). [1] South Texas principally argues that Sierra is affiliated with a firm that was proposed for debarment at the time of bid opening, and consequently is ineligible for award. We sustain the protest. The solicitation sought bids to purchase more than 300 line items of assorted electrical, electronic, and aircraft parts that are no longer needed by the government. The solicitation incorporated the agency's "Sale by Reference" pamphlet, which states that award will be made to the responsible bidder whose conforming bid is most advantageous to the government, price and other factors considered. The only factor to be considered under this solicitation, however, is price--award of each line item will be made to the responsible bidder submitting the highest price. The bid closing date was January 11, 1996. The contracting officer's review of bids disclosed that Sierra's bid of $6,858 was the highest received for line item number 295, a quantity of turbine engine nozzles; South Texas submitted the second-highest bid. South Texas subsequently contacted the agency and alleged that Sierra was affiliated with Garlick Helicopter, Inc., a firm which was proposed for debarment at the time of bid opening and, thus, ineligible to participate in this sales program. On January 17, the contracting officer asked Sierra to establish its nonaffiliation with Garlick. Sierra responded by stating that it was a minority investment stockholder in Garlick, and that the same person served as both a director and president of Sierra, and a director and chief financial officer of Garlick. The contracting officer determined that she did not have adequate information to make an affiliation determination, and asked Sierra to explain whether it shared offices with Garlick and to provide evidence of separate bank accounts. She also asked the firm to extend its bid acceptance period to allow the agency more time to resolve the matter. Sierra informed the agency that the two firms did not share offices and provided a copy of a deposit slip in its name as evidence that it had its own bank account. Sierra also extended its bid acceptance period. The contracting officer subsequently received a report from Dunn & Bradstreet indicating that no record of a business telephone listing under Sierra's name existed; no record of Sierra being granted a business or occupational license existed; and the address given for Sierra was a plot of land. In the face of this report, Sierra sent the contracting officer copies of its certificate of incorporation and its Internal Revenue Service new employer identification number form, and stated that no business license was required by its local government. While the contracting officer was considering this information, the proposed debarment of Garlick was lifted based upon the firm's entering into a settlement and compliance agreement with the Environmental Protection Agency and DRMS. The contracting officer informed South Texas that, in light of the fact that the proposed debarment had been lifted, she was proceeding to make award to Sierra. South Texas' agency-level protest of this intended action was denied, and the firm filed the same protest in our Office. The agency has withheld award pending the resolution of this protest. South Texas principally contends that award to Sierra under the circumstances here would be contrary to the applicable regulations.