Overview
FAR 9.103 establishes the fundamental principle that government contracts may only be awarded to "responsible" prospective contractors and mandates that Contracting Officers (COs) verify this status before making an award. It emphasizes that a contractor's capability to perform is just as critical as the price offered.
Key Rules
- Mandatory Responsibility: Purchases and awards are strictly limited to responsible prospective contractors.
- Affirmative Determination: A Contracting Officer must make a proactive, positive finding of responsibility; if the evidence is insufficient or unclear, the CO is required to make a determination of nonresponsibility.
- Small Business Protections: If a small business is found nonresponsible, the CO must refer the matter to the Small Business Administration (SBA) under the Certificate of Competency (COC) procedures in Subpart 19.6.
- Burden of Proof: The prospective contractor bears the burden of affirmatively demonstrating its responsibility, which includes ensuring the responsibility of its proposed subcontractors.
- Avoidance of "False Economy": The government is not required to award to the lowest bidder if that bidder lacks the necessary responsibility, as poor performance or default ultimately costs the government more than the initial savings.
Practical Implications
- Documentation is Critical: Contractors must be prepared to provide detailed evidence of financial resources, technical skills, and past performance history during the pre-award phase to avoid a nonresponsibility determination.
- Price is Not Absolute: This policy provides Contracting Officers with the legal authority to bypass the lowest-priced offeror if there is a legitimate concern regarding the firm's ability to fulfill the contract requirements.