Stapp Towing Inc. v. United States

40 Cont. Cas. Fed. 76,839, 34 Fed. Cl. 300, 1995 U.S. Claims LEXIS 180, 1995 WL 571427
CourtUnited States Court of Federal Claims
DecidedSeptember 27, 1995
DocketNo. 95-548C
StatusPublished
Cited by46 cases

This text of 40 Cont. Cas. Fed. 76,839 (Stapp Towing Inc. v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stapp Towing Inc. v. United States, 40 Cont. Cas. Fed. 76,839, 34 Fed. Cl. 300, 1995 U.S. Claims LEXIS 180, 1995 WL 571427 (uscfc 1995).

Opinion

OPINION

MILLER, Judge.

This case is before the court after argument on cross-motions for summary judgment. At issue is whether a determination by the Small Business Administration denying a barge operator a Certificate of Competency should be upheld.

FACTS

The following facts are drawn from the record developed before the Small Business Administration Certificate of Competency Review Committee, unless otherwise indicated. On November 16, 1995, the Military Traffic Management Command, Eastern Area (“MTMC-EA”), Bayonne, New Jersey, issued Solicitation No. DAHC21-95-B-0002 for the transportation of Department of Defense (“DOD”)-owned jet fuel by barge from origins in the Gulf Coast area and lower Mississippi River to destinations along the inland waterways of the United States and the Gulf Coast area. MTMC-EA solicits and awards long-term contracts, standing route orders, and one-time spot movements for transportation of Government fuel on behalf of the Defense Fuel Supply Center (“DFSC”). The Defense Fuel Region-South (“DFR-S”), a subordinate activity of DFSC, coordinates the transportation of bulk fuel in the Gulf Coast Region and was the ultimate customer on the solicitation at issue. The contract was for a one-year period with two one-year renewal options.

On December 19, 1994, Stapp Towing Company, Inc. (“plaintiff”), submitted a bid in response to the solicitation and, through a sealed bid process, was determined the lowest bid received. Plaintiff’s bid of $18,678,-534.00 was lower by some $1,170,337.00 than the bid of Jar Assets, Inc., the next lowest bidder. Plaintiff previously was awarded almost identical fuel-towing contracts for the DOD and commercial entities for essentially the same services.

On December 22, 1994, in accordance with section M.3 of the solicitation, MTMC-EA requested a pre-award survey of all bidders in order to determine whether the bidders possessed the technical, administrative, and financial capability to perform the contract. Under the solicitation an unsatisfactory result of the pre-award survey is cause for rejection of a firm’s bid. The prospective contractor has the burden of “affirmatively demonstrat[ing]” its responsibility. 48 C.F.R. (“FAR”) § 9.103 (1994). The terms of section C.1.3 of the solicitation, entitled “Safety,” require certain safety qualifications and mandate compliance with applicable regulations. Subsection C.l.3.1 requires the contractor to “establish and maintain an effective and comprehensive safety program that complies with” federal safety laws. [302]*302Subsection C.l.3.2 further requires the contractor to “maintain and operate all equipment in accordance with applicable U.S. Coast Guard regulations, federal and state laws, as well as cited military regulations, with particular regard to those military regulations promulgated by the Commander, Defense Fuel Supply Center.” The Defense Contract Management Command (“DCMC”) performed the pre-award survey of plaintiff, relying on information gathered by the Defense Contract Management Area Office (“DCMAO”), San Antonio, Texas.

As a result of its survey, DCMAO recommended that no award be made to plaintiff. Upon receipt of the adverse recommendation by the DCMAO pre-award survey team, Cynthia Schoner, the responsible MTMC-EA contracting officer, relied upon the recommendation and deemed plaintiff nonresponsi-ble on the same grounds as contained in the DCMAO pre-award survey report. By letter dated March 22, 1995, Ms. Schoner notified plaintiff of the denial. Ms. Schoner stated that the company “lack[ed] ... an effective EPA compliance and safety program” and that, “[biased on the aforementioned pre-award survey, I have determined that you do not have a satisfactory performance record, you do not possess the necessary technical skills and your environmental/safety record is severely deficient.” Ms. Schoner also noted that the safety checklist provided and the accident record presented did not constitute evidence of a demonstratively effective safety program.

Plaintiff disputes the rationale and specifics of Ms. Sehoner’s decision, contending that at all times it had available a satisfactory safety compliance program, viz., a Coast Guard approved “OPA 90” document. Plaintiff submitted its OPA 90 document as its environmental safety program pursuant to section C.l.3.2 of the solicitation. Plaintiff asserts, and defendant agrees, that the OPA 90 was acceptable under the company’s prior three-year contract for the same services (ending in late 1993); and, as the Small Business Administration (the “SBA”) noted, plaintiff’s plan was approved by the Coast Guard Districts in which it performed. Plaintiff disputes additional bases of the contracting officer’s referral to the SBA, including findings of lack of documentation on personnel training and lack of required materials documentation. Plaintiff claims that the contracting officer required “perfection” as a past performance standard for issuance of the contract. Plfs Proposed Findings of Uneontroverted Fact Nos. 19-21, filed Sept. 14, 1995.

Central to Ms. Schoner’s March 22, 1995 nonresponsibility decision was the frequency of spillage incidents involving plaintiff, its subsidiaries, and its subcontractors, as well as the total amount of fuel spilled as a result of the incidents. Ms. Schoner noted that the “Coast Guard has reported 81 violations on ... [plaintiff’s] 17 vessels from October 1984 through November 1994. Approximately 50 percent of these violations were oil spills.” Ms. Schoner further noted that between “March 1994 through July 1994, five out of eleven tows suffered leaks or spills — a 45% spillage rate.”

Plaintiff was entitled, as a small business, to request an SBA determination of the company’s responsibility under its Certificate of Competency (“COC”) program. 13 C.F.R. § 125.5(a)(1) (1995). See generally C & G Excavating, Inc. v. United States, 32 Fed.Cl. 231, 236 (1984). Under the program the SBA makes a determination of a small business’ responsibility to perform under a contract. After considering all aspects of a business’ responsibility, the SBA determines whether or not to issue a COC. If the SBA issues the COC, the procuring agency must accept the SBA’s responsibility determination as final. However, if the SBA declines to issue a COC, the contracting officer nevertheless may award the contract based on independent judgment and new information.

Upon determining that a small business is non-responsible, the contracting officer must notify the SBA of its determination. The agency then withholds award of the contract for up to 15 working days following receipt by the SBA of the notice of that determination. By letter dated March 28, 1995, the cognizant SBA regional office notified plaintiff, as required, of the availability of the COC program. The notification letter included detailed instructions concerning the [303]*303documentation that plaintiff should submit with its application. The SBA regional Office in Dallas, Texas (“SBA-TX”), was responsible for making the initial recommendation to issue or deny a COC to plaintiff. On April 4,1995, plaintiff applied for a COC and included additional information in response to all items requested by SBA-TX. Plaintiff provided SBA-TX with an extensive supplement to its COC application on April 11, 1995, in an effort to address specific findings of the contracting officer. The SBA’s COC review is based upon information provided by both the procuring agency and the small business offeror.

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Cite This Page — Counsel Stack

Bluebook (online)
40 Cont. Cas. Fed. 76,839, 34 Fed. Cl. 300, 1995 U.S. Claims LEXIS 180, 1995 WL 571427, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stapp-towing-inc-v-united-states-uscfc-1995.