B-156860, JUL. 26, 1965

B-156860, JUL. 26, 1965

TO EDUCATIONAL SERVICES:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM DATED MAY 25 AND MEMORANDUMS DATED JUNE 22 AND JULY 2, 1965, PROTESTING THE PROCEDURES FOLLOWED BY THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION (NASA) IN NEGOTIATING A CONTRACT UNDER REQUEST FOR PROPOSAL NO. 10-8001, FOR THE FURNISHING OF SERVICES TO CONDUCT THE SPACEMOBILE PROGRAM.

REQUEST FOR PROPOSAL NO. 10-8001 WAS ISSUED ON APRIL 9, 1965. SUBMISSION WAS INVITED OF A PROPOSAL FOR OPERATION OF THE "MOBILE SPACE AGE EDUCATIONAL DEMONSTRATION PROGRAM," GENERALLY REFERRED TO AS THE "SPACEMOBILE PROGRAM.' THE PROPOSAL REQUIRED THE FURNISHING OF 65 LECTURERS THROUGHOUT THE PERIOD OF THE CONTRACT AND THE PERIOD OF PERFORMANCE OF THE PROGRAM WAS STATED TO BE FOR 12 MONTHS, COMMENCING JULY 1, 1965 THROUGH JUNE 30, 1966, WITH OPTION TO THE GOVERNMENT TO REQUIRE THE CONTRACTOR TO CONTINUE THE OPERATION UNDER THE CONTRACT FOR TWO ADDITIONAL AND CONSECUTIVE 12-MONTH PERIODS. THE REQUEST FOR PROPOSAL EXPRESSLY RESERVED TO THE GOVERNMENT THE RIGHT TO REJECT ANY OR ALL PROPOSALS AND NEGOTIATE SEPARATELY WITH ANY SOURCE CONSIDERED QUALIFIED. PROVISION WAS ALSO INCLUDED THAT NASA WOULD SOLICIT FROM ALL AVAILABLE GOVERNMENT SOURCES EXPERIENCE DATA CONCERNING A PROPOSER'S PAST PERFORMANCE AND WOULD CONSIDER SUCH INFORMATION IN ITS EVALUATION. SOURCE EVALUATION BOARD, PROVIDED BY NASA REGULATIONS, WAS APPOINTED TO EVALUATE THE PROPOSALS AND TO PRESENT ITS FINDINGS TO THE DESIGNATED SOURCE SELECTION OFFICIAL. THE REQUEST FOR PROPOSAL PROVIDED THAT AWARD OF THE CONTRACT WOULD BE MADE TO THE FIRM SUBMITTING THE BEST PROPOSAL IN TERMS OF MEETING THE PROGRAM OBJECTIVES AT THE PRICE MOST FAVORABLE TO THE GOVERNMENT.

THE FOLLOWING PROPOSALS WERE RECEIVED BY THE SOURCE SELECTION BOARD:

TABLE

THE UNITEC CORP. $622,081

INSTRUCTIONAL DYNAMICS, INC. 821,667

EDUCATIONAL SERVICES 840,552

WESTREX DIVISION 847,279

LITTON SYSTEMS

THE M AND T COMPANY 858,279

WESTINGHOUSE 1,002,180

OKLAHOMA STATE UNIVERSITY 1,011,657

THE ABOVE PRICES ARE REPORTED TO REPRESENT THE AVERAGE OF THE PRICES QUOTED FOR THE INITIAL CONTRACT AND FOR THE OPTION PRICES FOR THE TWO SUCCEEDING YEARS. YOUR COMPANY'S QUOTATION WAS THIRD LOWEST. THE LOW QUOTATION, THAT OF UNITEC, IS APPROXIMATELY $200,000 LOWER THAN THE NEXT LOW PROPOSER AND $218,000 LOWER THAN YOUR COMPANY'S QUOTATION.

THE PROPOSALS WERE EVALUATED BY THE SOURCE SELECTION BOARD IN ACCORDANCE WITH THE EVALUATION CRITERIA. THE EVALUATION CRITERIA ESTABLISHED IN PARAGRAPH 3 OF ENCLOSURE 2 OF THE REQUEST, PROVIDES:

"A. PROGRAM OPERATION PROPOSAL

IN EVALUATING THIS PROPOSAL, THE GREATEST EMPHASIS WILL BE PLACED UPON THE FIRST AND SECOND CRITERIA LISTED BELOW:

(1) ABILITY TO PROVIDE THE REQUIRED NUMBER OF COMPETENT AND QUALIFIED LECTURERS.

(2) PROPOSED ORGANIZATION TO EFFECTIVELY CONDUCT THE PROGRAM DESCRIBED IN THIS REQUEST.

(3) EXPERIENCE IN THE FIELD OF EDUCATION.'

THE PROPOSAL OF UNITEC, A REPUTABLE FIRM WHICH HAD SUCCESSFULLY PERFORMED CONTRACTS WITH THE DEPARTMENT OF DEFENSE AS WELL AS WITH NASA, HAD DEMONSTRATED THAT IT POSSESSED THE REQUIRED QUALIFICATIONS AS WELL AS HAVING QUOTED A FIXED-PRICE SIGNIFICANTLY LOWER THAN THE OTHER OFFERORS. DECISION WAS THEREFORE MADE TO NEGOTIATE WITH UNITEC. DETAILED EXAMINATION OF UNITEC'S PROPOSAL DISCLOSED THAT IN ADDITION TO FIVE UNITEC EMPLOYEES DESIGNATED TO BE LECTURERS, SOME SIXTY-FIVE PERSONNEL RESUMES WERE INCLUDED THEREIN AS PROSPECTIVE LECTURERS. UNITEC'S PROPOSAL STATED THAT THROUGH AN ADVERTISING FIRM, UNITEC HAD PLACED ADVERTISEMENTS THROUGHOUT THE COUNTRY AND AS A RESULT HAD RECEIVED THIS NUMBER OF APPLICATIONS. THIRTY PERCENT HAD BEEN INTERVIEWED BY UNITEC BUT NO FIRM COMMITMENT OF EMPLOYMENT HAD AS YET BEEN MADE BY UNITEC TO THESE APPLICANTS. NO PERSONNEL OF YOUR COMPANY WAS INCLUDED IN THIS NUMBER, AS YOU HAVE ALLEGED. IT IS THE ADMINISTRATIVE VIEW THAT AT THIS POINT THE PROPOSAL OF UNITEC WAS FULLY RESPONSIVE TO THE REQUIREMENTS OF THE REQUEST FOR PROPOSALS. HOWEVER, THE CONTRACTING OFFICER WAS ASKED TO GIVE THE UNITEC COMPANY FIVE DAYS TO GET DEFINITE COMMITMENTS FROM AT LEAST THIRTY- FIVE LECTURERS. AT THE SAME TIME THE UNITEC COMPANY WAS GIVEN THE NAMES OF THE LECTURERS EMPLOYED BY YOUR COMPANY KNOWN TO NASA OFFICIALS FROM ITS DAILY CONTACTS IN ADMINISTERING THE CURRENT CONTRACT. IT WAS FELT THAT IN VIEW OF THE GENERAL ACCEPTABILITY TO NASA OF UNITEC'S PROPOSAL AND ITS SUPERIORITY TO ALL THE OTHER PROPOSALS, IT WOULD BE IN KEEPING WITH NASA'S BEST INTERESTS IF UNITEC WAS TO HAVE AN OPPORTUNITY TO APPROACH YOUR COMPANY'S LECTURER PERSONNEL AT THAT TIME IN ORDER TO MAKE TENTATIVE ARRANGEMENTS FOR THEIR EMPLOYMENT. THE CONTRACTING OFFICER, WITHIN THE TIME LIMITATION ACT, RECEIVED FROM UNITEC THIRTY SEVEN PERSONNEL RESUMES OF PROSPECTIVE LECTURERS WITH SATISFACTORY EVIDENCE OF COMMITMENT TO UNITEC, NONE OF WHOM WERE CURRENTLY EMPLOYED BY YOUR COMPANY. AT THIS STAGE OF THE PROCEEDINGS THE SOLICITATION OF YOUR EMPLOYEES HAD NO IMPACT ON YOUR COMPANY'S COMPETITIVE POSITION AS IT HAD BEEN ELIMINATED FROM FURTHER CONSIDERATION FOR CONTRACT SELECTION. ACCORDINGLY, ON JUNE 8, 1965, AWARD WAS DIRECTED TO UNITEC.

THE ABOVE CLAUSES OF THE PROGRAM OPERATION PROPOSAL IMPOSE NO ABSOLUTE REQUIREMENT THAT THE PROPOSER MUST HAVE HAD AT HAND AT THE TIME OF EVALUATION OF THE PROPOSAL THE FULL COMPLEMENT OF 65 LECTURERS TO BE ASSIGNED FOR PERFORMANCE OF THE CONTRACT DURING THE 12-MONTH PERIOD IN ORDER TO BE CONSIDERED AS RESPONSIVE TO THE REQUEST. RATHER, THEY ARE MORE INDICATIVE OF AN ALTERNATIVE GIVEN TO THE PROPOSER OF EITHER LISTING THE NAMES AND RESUMES OF ADDITIONAL PERSONNEL PROPOSED TO BE EMPLOYED AS LECTURERS, OR OF ESTABLISHING SUCH A RECRUITMENT PROGRAM FOR LECTURERS AS WOULD SHOW THAT THE PROPOSER HAD THE ABILITY TO PROCURE QUALIFIED PERSONNEL. WITH RESPECT TO YOUR ALLEGATIONS AS TO THE RESPONSIBILITY OF THE SUCCESSFUL CONTRACTOR BASED UPON ITS ABILITY TO PERFORM AT THE TIME ITS PROPOSAL WAS SUBMITTED, WE HAVE HELD THAT THE CRITICAL TIME IS THE SCHEDULED TIME FOR COMMENCEMENT OF PERFORMANCE PLUS ANY LEAD TIME WHICH MAY BE NECESSARY IN THE PARTICULAR CASE. COMPARE 39 COMP. GEN. 655. SINCE THE AWARD, AND CONSEQUENTLY, THE DETERMINATION OF RESPONSIBILITY, MUST BE MADE PRIOR TO THAT TIME, WE THINK THAT THE PROPOSER MAY BE REGARDED AS RESPONSIBLE IF IN THE VIEW OF THE CONTRACTING AGENCY THE BIDDER WILL BE CAPABLE OF PERFORMING AT THE REQUIRED TIME. IN SUCH MATTERS OF QUALIFICATION IT IS WELL RECOGNIZED THAT THE CONTRACTING AGENCY IS INVESTED WITH A LARGE DEGREE OF DISCRETION. SEE B-125247, DATED SEPTEMBER 20, 1955. FURTHER, NOTHING WRONGFUL OR TORTIOUS IN THE ABOVE ACTIONS BY THE CONTRACTING AGENCY HAS BEEN FOUND AS YOU HAVE ALLEGED. ARTICLE XV OF YOUR COMPANY'S CONTRACT, ENTITLED "PERSONNEL HANGE-OVER" PROVIDED AS FOLLOWS:

"THE CONTRACTOR RECOGNIZES THAT AT THE END OF THE PERIOD OF PERFORMANCE, THE GOVERNMENT MAY DESIRE TO MAKE OTHER ARRANGEMENTS FOR THE CONTINUATION OF THE PROGRAM AND AGREES TO THE CONDITIONS SET FORTH IN THE FOLLOWING PARAGRAPHS:

"1. THE CONTRACTOR RECOGNIZES THAT HE MAY BE REPLACED BY A SUCCESSOR CONTRACTOR IN THE PERFORMANCE OF WORK OF THE KIND AND TYPE PROVIDED HEREIN. THE CONTRACTOR AGREES TO USE HIS OWN BEST EFFORTS TO EFFECT AN ORDERLY AND EFFICIENT TRANSITION FROM THE CONTRACTOR TO SUCH SUCCESSOR CONTRACTOR AND HIS EMPLOYEES DURING A TRANSITION PERIOD TO BE SPECIFIED BY THE CONTRACTING OFFICER.

"2. THE CONTRACTOR ALSO RECOGNIZES THE IMPORTANCE TO THE GOVERNMENT OF RETENTION OF PERSONNEL EXPERIENCED IN THE WORK PROVIDED HEREIN. THEREFORE, IN THE EVENT THAT THE CONTRACTOR IS REPLACED IN THE PERFORMANCE OF THE WORK PROVIDED HEREIN BY A SUCCESSOR CONTRACTOR, THE CONTRACTOR AGREES TO COOPERATE IN RELEASING ANY OF HIS EMPLOYEES WHO DESIRE TO CONTINUE WITH SUCH WORK, AND TO ENCOURAGE SUCH EMPLOYEES TO SO REMAIN.

"3. THE CONTRACTOR ALSO RECOGNIZES THAT THE ABILITY TO RETAIN SUCH EXPERIENCED PERSONNEL ON THE WORK MAY BE SIGNIFICANTLY ENHANCED IF SUCH PERSONNEL CAN REMAIN WITHOUT APPRECIABLE LOSS OF EARNED FRINGE BENEFITS, OR UNDER CIRCUMSTANCES WHICH OFFER COMPARABLE BENEFITS TO THOSE PREVIOUSLY EARNED. IN THIS REGARD, THE CONTRACTOR AGREES TO MAKE AVAILABLE TO THE GOVERNMENT AND/OR SUCCESSOR CONTRACTOR ANY AND ALL RECORDS, OR OTHER DATA WHICH MAY BE REQUIRED TO PROPERLY ASCERTAIN EARNED BENEFITS OF SUCH EMPLOYEES AND/OR THEIR RELATIVE POSITION WITHIN THE FRINGE BENEFIT PROGRAM OF THE CONTRACTOR. IN ADDITION, THE CONTRACTOR AGREES TO ENTER INTO NEGOTIATIONS WITH THE GOVERNMENT TO EQUITABLY CREDIT TO THE CONTRACT ALL ACCRUED EXPENSES FOR FRINGE BENEFITS WHICH HAVE BEEN ACCUMULATED TO COVER EMPLOYEES SO TRANSFERRED.

"4. WHEN SO DIRECTED BY THE CONTRACTING OFFICER, THE CONTRACTOR WILL PREPARE A DETAILED PLAN FOR IMPLEMENTING THE ABOVE PROVISIONS; SUCH PLAN TO INCLUDE COSTS AND SCHEDULES. THE PLAN WILL BE SUBMITTED TO THE CONTRACTING OFFICER FOR HIS APPROVAL. IMPLEMENTATION OF THE PLAN OR ANY PART THEREOF WILL BE ACCOMPLISHED PURSUANT TO THE DIRECTIONS OF THE CONTRACTING OFFICER.'

A REASONABLE INTERPRETATION OF THIS ARTICLE IS THAT THE INCUMBENT CONTRACTOR AGREES, DURING THE TRANSITION PERIOD OF REPLACEMENT BY A SUCCESSOR CONTRACTOR, TO COOPERATE IN RELEASING ANY OF ITS EMPLOYEES WHO MIGHT DESIRE TO CONTINUE TO WORK ON THE SPACEMOBILE PROGRAM. IN THIS VIEW IT IS ONLY REASONABLE THAT THE PROSPECTIVE SUCCESSFUL PROPOSER SHOULD HAVE THE RIGHT TO SOLICIT PERSONNEL OF THE INCUMBENT CONTRACTOR, AND THAT THE GOVERNMENT HAVE THE RIGHT TO MAKE AVAILABLE FOR SUCH PURPOSES THE NAMES OF CONTRACTORS' PERSONNEL EMPLOYED IN THE PROGRAM. NO DISCUSSION REGARDING SALARY RATES OR ENCOURAGEMENT TO UNITEC TO BARGAIN WITH THESE INDIVIDUALS WAS GIVEN. INASMUCH AS THE LECTURERS' SALARIES WERE ALREADY INCLUDED IN THE FIXED-PRICE PORTION OF THE PROPOSAL BY UNITEC, THE AMOUNT OF COMPENSATION TO BE PAID BY UNITEC TO ITS EMPLOYEES WAS A MATTER OF NO CONCERN TO NASA.

REGARDING YOUR ALLEGATIONS THAT UNFAIR AND IRREGULAR PROCEDURES WERE FOLLOWED BY NASA IN EVALUATING THE PROPOSALS IT IS FOUND THAT THE PROVISIONS OF THE NASA SOURCE EVALUATION BOARD MANUAL, NPC 402, ESTABLISHES THE DIRECTOR OF PROCUREMENT, NASA HEADQUARTERS, WITHIN SPECIFIED DOLLAR LIMITATIONS, AS THE SOURCE SELECTION OFFICIAL FOR PROCUREMENTS UNDER THE COGNIZANCE OF HEADQUARTERS STAFF OFFICES, INTO WHICH CATEGORY THE PRESENT PROCUREMENT FALLS. THUS, THE AUTHORITY OF THE DIRECTOR OF PROCUREMENT TO DIRECT THE SELECTION OF THOSE FIRMS WITH WHOM THE GOVERNMENT SHALL NEGOTIATE AND TO MAKE THE ULTIMATE SELECTION FOR AWARD OF A CONTRACT IS PARAMOUNT TO THE NEGOTIATION AUTHORITY OF THE CONTRACTING OFFICER. PARAGRAPH 2 OF ENCLOSURE (2) OF THE REQUEST FOR PROPOSAL CLEARLY SETS FORTH THAT THE PROPOSALS SUBMITTED WILL BE EVALUATED BY A NASA SOURCE EVALUATION BOARD.

YOUR REFERENCE TO THE ADDITION OF "TRAINING MONEY" TO THE CONTRACTOR'S BID PRICE FOR FISCAL YEAR 1966 IS NOT CLEAR. PARAGRAPH 5B (1) OF ENCLOSURE (2) OF THE REQUEST FOR PROPOSAL PROVIDES THAT IN ORDER TO CONTINUE THE SPACEMOBILE PROGRAM OPERATION UNINTERRUPTEDLY DURING THE PERIOD OF TRANSITION FROM THE PRESENT CONTRACTOR OPERATION TO OPERATION BY THE SUCCESSFUL OFFEROR IN RESPONSE TO THIS REQUEST FOR PROPOSAL, IT IS NECESSARY THAT ALL PERSONNEL TO BE ASSIGNED AS LECTURERS RECEIVE INDOCTRINATION AND TRAINING PRIOR TO ASSUMING THEIR RESPONSIBILITIES AS LECTURERS. IT IS PROVIDED THAT IN THE EVENT THE OFFEROR INTENDS TO EMPLOY PERSONNEL WHO HAVE PREVIOUSLY BEEN EMPLOYED AS LECTURERS IN THE SPACEMOBILE PROGRAM, OR WHO ARE CURRENTLY SO EMPLOYED, THESE INDIVIDUALS WILL BE EXEMPT FROM THE TRAINING REQUIREMENT. A MAXIMUM PRICE IS REQUIRED TO BE PROPOSED, SUBJECT TO ADJUSTMENT ACCORDING TO THE ACTUAL NUMBER OF PARTICIPANTS. ARTICLE III C OF ENCLOSURE (3) OF THE REQUEST FOR PROPOSALS PROVIDES FURTHER CLARIFICATION OF WHAT THE GOVERNMENT WILL PROVIDE BY WAY OF DIRECT ASSISTANCE TO LECTURER TRAINING SUCH AS TRAINING MATERIAL, LECTURERS, CLASSROOMS, AND DEMONSTRATION MODELS.

THE QUALIFICATIONS OF LECTURERS ARE SET OUT IN ARTICLE III B OF ENCLOSURE (3) OF THE REQUEST. WHILE YOU ALLEGE THAT THESE ARE NOT ADEQUATELY STATED YOU DO NOT SPECIFY WHEREIN THEY ARE INADEQUATE AND AN EXAMINATION THEREOF REVEALS NO LACK OF PARTICULARITY IN DEFINING THEIR SCOPE AND APPLICATION.

THE ACTION TAKEN IN THIS PROCUREMENT APPEARS TO HAVE BEEN TAKEN IN THE BEST INTEREST OF THE GOVERNMENT IN ACCORDANCE WITH THE RESPONSIBILITY PLACED UPON PROCUREMENT OFFICIALS TO OBTAIN MAXIMUM COMPETITION WHEREVER POSSIBLE IN CONNECTION WITH THE OBTAINING OF SUPPLIES OR SERVICES FOR THE GOVERNMENT. BASED UPON THE FOREGOING, IT IS OUR OPINION THAT THE RECORD OF THIS PROCUREMENT AFFORDS NO VALID BASIS TO SUPPORT A CONCLUSION THAT THE CONTRACT WAS IMPROPERLY AWARDED TO THE UNITEC CORPORATION OR THAT THE CONTRACT DOES NOT CONSTITUTE A VALID AND BINDING OBLIGATION ON THE PART OF THE GOVERNMENT. ACCORDINGLY, YOUR PROTEST MUST BE DENIED.