XO Communications, Inc., B-290981, October 22, 2002

B-290981 Oct 22, 2002 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights DIGEST Agency reasonably determined that protester was nonresponsible where. The contracting officer had recognized the implications of an anticipated bankruptcy filing and reasonably concluded that it was unlikely that the bankruptcy reorganization plan would significantly reduce the financial risk. The bankruptcy reorganization was itself likely to create contract performance risk. XO objects to the agency's determination that XO is not a responsible prospective contractor. XO and Qwest were the only offerors to submit proposals by the September 24 closing date. Final proposal revisions were requested on February 28. Were received from both offerors on March 7. Which was the only responsible offeror. View Decision XO Communications, Inc., B-290981, October 22, 2002 * REDACTED DECISION DIGEST Attorneys DECISION XO Communications, Inc. protests an award to Qwest Corporation under request for proposals (RFP) No. TQD-SC-01-1027, issued by the General Services Administration for telecommunications services for federal agencies and other authorized users in the Salt Lake City metropolitan area. XO objects to the agency's determination that XO is not a responsible prospective contractor. We deny the protest. The RFP, issued electronically on August 6, 2001, contemplated the award of one or more contracts for a 4-year base period with four 1-year options. The RFP provided for one award to the responsible offeror submitting the technically acceptable proposal with the lowest total offered price, and for the possible consideration of additional awards based on the next lowest total offered price. XO and Qwest were the only offerors to submit proposals by the September 24 closing date. After a competitive range determination, the conduct of discussions, and the submission of proposal revisions, final proposal revisions were requested on February 28, 2002, and were received from both offerors on March 7. In a post-negotiation memorandum (PNM) executed on June 11, the contracting officer stated that both proposals had been evaluated as technically acceptable with fair and reasonable prices, and that XO's proposal represented the lower total offered price. However, the contracting officer recommended that award be made to Qwest, which was the only responsible offeror. The contracting officer determined that XO was not responsible on the basis of its financial condition, because XO lacked adequate financial resources to perform the contract, or the ability to obtain them. Agency Report (AR), Tab 133, PNM, at 21--22. The source selection authority adopted this recommendation and, on June 17, determined to make a single award to Qwest. The contract with Qwest was fully executed on July 9. XO was notified that it was an unsuccessful offeror on July 10, and after receiving a debriefing, timely filed this protest with our Office. The only issue presented by this case is the propriety of the agency's nonresponsibility determination. /1/ A contract may be awarded only to a responsible prospective contractor. FAR Sec. 9.103(a). No award can be made unless the contracting officer makes an affirmative determination of responsibility; in the absence of information clearly indicating that the prospective contractor is responsible, the contracting officer is required to make a determination of nonresponsibility. FAR Sec. 9.103(b). A finding of responsibility requires, among other things, that the potential contractor have adequate financial resources to perform the contract or the ability to obtain them. FAR Sec. 9.104-1(a). In making a responsibility determination, the contracting officer may rely on the results of a pre-award survey, and we will consider the accuracy of the survey information in reviewing whether the contracting officer's nonresponsibility determination was reasonable. Harvard Interiors Mfg. Co., B-247400, May 1, 1992, 92-1 CPD Para. 413 at 3. Since the agency must bear the brunt of any difficulties experienced in obtaining the required performance, contracting officers are vested with a wide degree of discretion and business judgment in reaching a nonresponsibility determination, and our Office will not question such a determination unless a protester can establish that it lacked a reasonable basis. Computervision Corp., B-257141, Aug. 12, 1994, 94-2 CPD Para. 73 at 3. Here, the contracting officer based his nonresponsibility determination on multiple pre-award surveys (GSA Credit and Finance Surveys), filings by XO with the Securities and Exchange Commission, financial information provided directly to the agency by XO, and XO press releases and other information reported in the media. AR, Contracting Officer's Statement, at 2.