B-147394, SEP. 4, 1962

B-147394, SEP. 4, 1962

TO THE M AND T COMPANY:

THIS REFERS TO YOUR LETTER OF OCTOBER 25, 1961, AND PREVIOUS CORRESPONDENCE, PROTESTING THE AWARD TO ANOTHER FIRM MADE UNDER REQUEST FOR QUOTATION NO. 1/3900-62-LP68001), ISSUED BY SAN ANTONIO

THE REQUEST WAS ISSUED ON MAY 12, 1961, SOLICITING PROPOSALS FOR THE MANAGEMENT, SUPERVISION, LABOR SERVICES, TOOLING, PARTS AND MATERIALS NECESSARY FOR THE MAINTENANCE AND REPAIR OF SPECIAL PURPOSE VEHICLES AND ALSO SPACE GROUND EQUIPMENT AT KELLY AIR FORCE BASE AND SAN ANTONIO AIR FORCE STATION, SAN ANTONIO, TEXAS. A DETERMINATION WAS MADE PURSUANT TO 10 U.S.C. 2306/C) TO USE A COST-PLUS-A-FIXED-FEE TYPE THE PROPOSED WORK COULD NOT BE ESTABLISHED IN ADVANCE, AND THAT THE COST OF PERFORMING THE REQUIRED WORK COULD NOT BE ACCURATELY FORECAST. NEGOTIATION FOR THE SERVICES WAS AUTHORIZED PURSUANT TO 10 U.S.C. 2304/A) (10) WAS CONTEMPLATED BY PARAGRAPH 3-210.2/IX) OF THE ARMED SERVICES PROCUREMENT REGULATION, ON A DETERMINATION THAT IT WAS IMPRACTICAL TO SECURE COMPETITION BY MEANS OF FORMAL ADVERTISING.

ATTACHMENT NO. 1 TO THE REQUEST STATED IN PART AS FOLLOWS:

"SECTION III. EVALUATION:

"A. ALL QUOTATIONS RECEIVED SHALL BE SUBJECTED TO AN EVALUATION BY A DULY SELECTED PANEL OF QUALIFIED AIR FORCE PERSONNEL FOR THE PURPOSE OF SELECTING THE QUOTER/S) WITH WHOM NEGOTIATIONS MAY BE CONDUCTED. * * * THE AREAS OF CONSIDERATION TO BE USED IN MAKING THE EVALUATION ARE THE FOLLOWING:

"1. PRESENT KEY MANAGEMENT PERSONNEL (EXECUTIVE, ADMINISTRATIVE, SUPERINTENDENT AND FOREMAN) TO BE UTILIZED IN THE PROPOSED AWARD. * * *

"2. PRIOR OR COMPARABLE EXPERIENCE IN PERFORMING WORK OF THE TYPES CONTEMPLATED. * * *

"3. QUOTER'S PLAN TO STAFF AND OPERATE THE MAINTENANCE AND REPAIR FACILITY. * * *

"4. FINANCIAL STATUS AND CAPABILITY. * * *

"5. ESTIMATED COST. * * *

"6. FEE. * * *

"B. THE EVALUATION PANEL WILL USE AN ESTABLISHED CRITERIA IN ARRIVING AT THE QUOTER/S) WITH WHOM NEGOTIATION MAY BE CONDUCTED. THIS CRITERIA SHALL PROVIDE A PREDETERMINED MAXIMUM POINT VALUE FOR EACH AREA OF CONSIDERATION. BASED ON THE DATA PRESENTED AND FINDINGS OF THE PANEL AND THE POINT VALUE DECIDED UPON WILL BE RECORDED AND THE NET AGGREGATE OF THE AREAS UNDER CONSIDERATION WILL DETERMINE WHICH QUOTER/S) SHALL BE SELECTED WITH WHOM FINAL NEGOTIATIONS WILL BE CONDUCTED.'

A TOTAL OF 200 POINTS WAS ASSIGNED FOR THE 6 AREAS, WHICH FACT WAS NOT REVEALED TO THE QUOTERS, AS FOLLOWS:

TABLE

"1. PERSONNEL TO BE UTILIZED IN THE MAXIMUM POINTS

PROPOSED AWARD 50

"2. PRIOR OR COMPARABLE EXPERIENCE IN 50

PERFORMING WORK OF THE TYPES

CONTEMPLATED

"3. CONTRACTOR'S PLAN TO STAFF AND OPERATE 60

THE MAINTENANCE AND REPAIR FACILITY

"4. FINANCIAL STATUS AND CAPABILITY 10

"5. FEE 20

"6. COST 10"

TWELVE QUOTATIONS WERE RECEIVED BY THE CLOSING DATE ON JUNE 22, 1961, AS PROVIDED BY THE EVALUATION PROCEDURE. THE QUOTATIONS WERE EVALUATED BY EACH MEMBER OF THE EVALUATION COMMITTEE INDEPENDENTLY AND APART FROM THE OTHER MEMBERS OF THE COMMITTEE. THE POINTS ASSIGNED TO EACH QUOTER IN AN AREA WERE ARRIVED AT BY TAKING THE AVERAGE OF THE TOTAL POINTS ASSIGNED BY THE INDIVIDUAL EVALUATORS. THE RESULT OBTAINED FOR "FINANCIAL CAPABILITY" (ITEM 4) WAS THE UNANIMOUS OPINION OF THE COMMITTEE, AND THE POINTS ASSIGNED FOR ESTIMATED COST AND FEE (ITEMS 5 AND 6) WERE COMPUTED BY PREDETERMINED FORMULAS.

AN EVALUATION OF THE 12 CONTRACTORS' QUOTATIONS RECEIVED WAS MADE AND THE EVALUATION COMMITTEE RECOMMENDED IN A REPORT DATED JULY 6, 1961, THAT THE CONTRACTING OFFICER NEGOTIATE WITH THE FOUR QUOTERS THAT WERE AWARDED THE HIGHEST NUMBER OF POINTS. THE FOUR HIGH CONTRACTORS LISTED WERE, IN THE DESCENDING ORDER OF POINTS RECEIVED, THE TUMPANE COMPANY, INC., BEISER AVIATION CORPORATION, THE M AND T COMPANY, AND THE HAYES CORPORATION. NEGOTIATIONS WERE CONDUCTED WITH THESE FOUR FIRMS DURING JULY 1961. AS A RESULT IT WAS DETERMINED THAT FURTHER NEGOTIATIONS WOULD BE CONDUCTED WITH TUMPANE AND BEISER, AS M AND T AND HAYES WERE CONSIDERED TO BE UNSUITABLE FOR PURPOSES OF THIS AWARD.

HOWEVER, PRIOR TO THE MAKING OF AN AWARD, THE DEPARTMENT REVISED ITS PREVIOUSLY ESTIMATED DIRECT LABOR MAN-HOURS, ITS ESTIMATED TOTAL COST OF GOVERNMENT FURNISHED PARTS, AND ITS TOTAL COST OF CONTRACTOR FURNISHED PARTS. IN VIEW OF THE REVISED ESTIMATES, AMENDED ESTIMATED COST AND FIXED FEE QUOTATIONS WERE REQUESTED FROM THE INTERESTED QUOTERS. THE AMENDED PROPOSALS WERE EVALUATED AGAIN UNDER THE POINT SYSTEM AND TUMPANE, BEISER AND THE M AND T COMPANY SCORED HIGHEST IN THE ORDER NAMED. FROM AMONG THESE, TUMPANE WAS SELECTED FOR FINAL NEGOTIATION. ON OCTOBER 1, 1961, AWARD WAS ISSUED TO TUMPANE AT AN ESTIMATED COST OF $969,265, AND A FIXED FEE OF $27,500. THE M AND T COMPANY HAD SUBMITTED THE LOWEST ESTIMATED COST AND FIXED FEE, AT $742,320 PLUS A $1 FEE.

YOU CONTEND THAT IF YOUR PROPOSAL WAS REJECTED BECAUSE OF CAPACITY OR CREDIT, THE MATTER SHOULD HAVE BEEN SUBMITTED TO THE SBA PRIOR TO REJECTION FOR POSSIBLE ISSUANCE OF A CERTIFICATE OF COMPETENCY. HOWEVER, THE AIR FORCE DID NOT FIND THAT YOUR FIRM LACKED EITHER THE CAPACITY OR THE CREDIT TO PERFORM THE WORK. IN THE EVALUATION OF THE ELEMENT REGARDING FINANCIAL STATUS AND CAPABILITY, YOUR FIRM RECEIVED THE MAXIMUM NUMBER OF POINTS ALLOWED. THE PRIMARY CONSIDERATION IN DETERMINING TO WHOM THE AWARD SHALL BE MADE UNDER A CPFF TYPE CONTRACT IS: WHICH CONTRACTOR CAN PERFORM THE CONTRACT IN A MANNER MOST ADVANTAGEOUS TO THE GOVERNMENT. ASPR, SECTION 3.805.2. THE CONTRACTING OFFICER DETERMINED THAT YOUR PROPOSAL WAS NOT THE MOST ADVANTAGEOUS OFFER RECEIVED BY THE GOVERNMENT ON THIS PROCUREMENT. ISSUANCE OF A CERTIFICATE OF COMPETENCY OF YOUR FIRM WOULD NOT HAVE INDICATED THAT YOU HAD SUBMITTED THE BEST PROPOSAL. UNDER THESE CIRCUMSTANCES WE DO NOT BELIEVE THAT THE AIR FORCE WAS REQUIRED TO SUBMIT YOUR PROPOSAL TO THE SBA FOR THE ISSUANCE OF A CERTIFICATE OF COMPETENCY PRIOR TO ITS REJECTION.

YOU FURTHER CONTEND THAT THE BASIS FOR THE AWARD WAS UNKNOWN TO YOU AT THE TIME OF BIDDING AND AT THE NEGOTIATIONS, AND YOU REQUEST THAT THE BASIS OF AWARDING POINTS BE INVESTIGATED TO DETERMINE WHETHER YOU RECEIVED EQUITABLE TREATMENT ACCORDING TO REGULATIONS.

ATTACHMENT NO. I TO THE REQUEST FOR QUOTATIONS INFORMED PROSPECTIVE CONTRACTORS THAT ALL QUOTATIONS RECEIVED WOULD BE EVALUATED BY AN AIR FORCE EVALUATION PANEL FOR THE PURPOSE OF SELECTING THE QUOTERS WITH WHOM NEGOTIATIONS WOULD BE CONDUCTED. THE AREAS FOR CONSIDERATION IN MAKING THE EVALUATION WERE SET FORTH, BUT THE WEIGHTS ASSIGNED TO EACH AREA WERE NOT SPECIFIED. WE CANNOT SAY THAT THIS WAS IMPROPER, ALTHOUGH WE BELIEVE QUOTERS WOULD HAVE BEEN IN A BETTER POSITION TO MAKE INFORMED AND REALISTIC PROPOSALS IF THEY HAD BEEN TOLD THE RELATIVE IMPORTANCE ATTACHED TO EACH EVALUATION FACTOR.

YOUR FIRM WAS ONE OF FOUR SELECTED FOR NEGOTIATION. AFTER NEGOTIATIONS WERE CONDUCTED WITH YOUR FIRM, DUE TO THE REVISED ESTIMATE BY THE GOVERNMENT, YOU TOOK THE OPPORTUNITY TO SUBMIT A REVISED QUOTATION WHICH WAS REEVALUATED. HOWEVER, IT WAS DETERMINED BY THE CONTRACTING OFFICER THAT TUMPANE SUBMITTED A MORE ADVANTAGEOUS OFFER TO THE GOVERNMENT. FROM THESE FACTS WE DO NOT FIND THAT YOU WERE TREATED INEQUITABLY OR CONTRARY TO REGULATIONS. ACCORDINGLY, YOUR PROTEST IS DENIED.

PURSUANT TO YOUR PROTEST, THE ADMINISTRATOR OF THE SMALL BUSINESS ADMINISTRATION SUBMITTED HIS VIEWS TO THIS OFFICE REGARDING THE POINT EVALUATION METHOD AS UTILIZED ON THIS PROCUREMENT. ENCLOSED IS A COPY OF OUR LETTER OF TODAY TO THE SECRETARY OF THE AIR FORCE CONCERNING THIS MATTER.