B-160486, JAN. 8, 1968

B-160486, JAN. 8, 1968

BIDS - NEGOTIATION - SOLE SOURCE DECISION TO SECY. OF THE NAVY CONCERNING PROTEST BY SYSTRON-DONNER CORPORATION TO AWARD TO ELECTRONIC ASSOCIATES, INC. (EAI) FOR AN ANALOG COMPUTER FOR NAVAL AIR STATION, PATUXENT RIVER, MD. PROPOSED SOLE-SOURCE AWARD OF A SUBSTANTIALLY HIGHER PRICED COMPUTER WHEN A LOWER PRICED COMPUTER WOULD MEET THE GOVERNMENT'S NEED IS IMPROPER AND THE PROCURING ACTIVITY'S FAILURE TO REVISE SPECIFICATIONS TO REFLECT ITS ACTUAL NEEDS AND SOLICIT COMPETITION TEND TO UNDERMINE PUBLIC CONFIDENCE IN THE INTEGRITY OF THE COMPETITIVE PROCUREMENT SYSTEM. GAO WOULD CONSIDER PROPOSED AWARD IMPROPER IN THE AUDIT OF EXPENDITURES OF APPROPRIATED FUNDS UNDER THE CONTRACT. ALSO IF FURTHER ACTION IS CONTEMPLATED IT IS SUGGESTED THAT AUTHORITY BE CONSIDERED IN LIGHT OF PUBLIC LAW 89-306, AND DECISION B 151204 - B- 157587, NOV. 21, 1967.

TO MR. SECRETARY:

REFERENCE IS MADE TO A PROTEST BY BURLINGAME ASSOCIATES LTD., ON BEHALF OF SYSTRON-DONNER CORPORATION AGAINST THE PROPOSED AWARD OF A CONTRACT BY THE NAVAL AIR STATION (NAS), PATUXENT RIVER, MARYLAND, TO ELECTRONIC ASSOCIATES, INC. (EAI), FOR AN EAI-TR48 ANALOG COMPUTER.

AS INDICATED BY THE RECORD BEFORE THIS OFFICE, A PROCUREMENT FOR THIS ARTICLE WAS INITIATED UNDER INVITATION FOR BIDS (IFB) N00421-67-B 0032, ISSUED BY NAS ON NOVEMBER 9, 1966. THEREAFTER SYSTRON-DONNER LODGED A PROTEST WITH THIS OFFICE ALLEGING THAT THE SPECIFICATIONS INCORPORATED IN THE IFB WERE COPIED ESSENTIALLY FROM EAI'S MODEL TR-48 COMPUTER AND THAT SUCH ACTION RESTRICTED COMPETITION. HOWEVER, SYSTRON DONNER SUBMITTED A BID UNDER THE IFB BASED UPON ITS SD80 MODEL ANALOG COMPUTER. BY LETTER DATED FEBRUARY 21, 1967, FROM THE DEPUTY COMMANDER, PURCHASING, NAVAL SUPPLY SYSTEMS COMMAND, THIS OFFICE WAS ADVISED THAT THE SPECIFICATIONS AS WRITTEN WERE CONSIDERED BY YOUR DEPARTMENT TO BE RESTRICTIVE AND, ACCORDINGLY, THE IFB WAS CANCELLED. THIS LETTER FURTHER ADVISED THAT NEW SOLICITATION DOCUMENTS WOULD BE ISSUED UPON REVISION OF THE SPECIFICATIONS TO INDICATE CLEARLY THE ACTUAL REQUIREMENTS OF NAS.

CONTRARY TO THE ABOVE ADVICE, NAS ISSUED NEW SOLICITATION DOCUMENTS ON MARCH 14, 1967, UNDER REQUEST FOR PROPOSAL (RFP) N00421-67-R-4082, WHICH INCORPORATED THE IDENTICAL RESTRICTIVE SPECIFICATIONS. THE RECORD FURTHER INDICATES THAT ONLY EAI WAS PROVIDED WITH A COPY OF THE RFP SINCE THE CONTRACTING OFFICER BELIEVED SUFFICIENT JUSTIFICATION EXISTED FOR A SOLE SOURCE PROCUREMENT. IT DOES NOT APPEAR, HOWEVER, THAT WE HAVE EVER BEEN FURNISHED WITH ANY DETERMINATION AND FINDINGS IN SUPPORT OF SUCH NEGOTIATION, OR ADVISED THAT ANY SUCH D-AND-F HAS BEEN ENTERED.

NAS'S ATTEMPT TO PROCURE AN EAI-TR48 ANALOG COMPUTER UNDER A SOLE SOURCE PURCHASE WITH EAI RESULTED IN ANOTHER PROTEST TO THIS OFFICE BY THE SYSTRON-DONNER REPRESENTATIVE, WHO OBJECTED ON THE GROUND THAT THE CORPORATION HAD EXPENDED A CONSIDERABLE EFFORT IN THIS MATTER WITH THE UNDERSTANDING THAT IF ITS ORIGINAL CONTENTION CONCERNING THE RESTRICTIVE SPECIFICATIONS WAS VALID IT WOULD BE PROVIDED WITH AN OPPORTUNITY TO COMPETE FOR THE PROCUREMENT ON AN EQUAL BASIS. IN THIS REGARD THE CORPORATION CONTENDS THAT THERE APPEARS TO BE NO REASON FOR THE PURCHASING ACTIVITY'S CONTINUED INSISTENCE ON PURCHASING ONE MANUFACTURER'S STANDARD PRODUCT WITHOUT EVEN EXPLORING WHAT ELSE MIGHT BE AVAILABLE, POSSIBLY AT A LOWER COST.

IN A REPORT TO THIS OFFICE DATED APRIL 25, 1967, FROM THE DEPUTY COMMANDER, PURCHASING, NAVAL SUPPLY SYSTEMS COMMAND, THE JUSTIFICATION FOR THE SOLE SOURCE PROCUREMENT WAS SET FORTH AS OLLOWS:

"A. THE JUSTIFICATION FOR SOLE SOURCE PROCUREMENT OF THE EAI TR-48 STATED THE REQUIREMENT FOR SLAVING WITH AN EAI TR-20 CURRENTLY ONBOARD THE NAVAL AIR TEST CENTER TO GET A MAXIMUM GAIN IN THE TOTAL COMPUTING ABILITY WITH THE PROPOSED COMBINATION.

"B. WITH THE REQUESTED COMBINATION, THE TOTAL CAPACITY OF THE PROPOSED COMPUTER WOULD BE INCREASED BY 40 PERCENT, AS THERE WOULD BE 100 PERCENT COMPATIBILITY BETWEEN THE UNITS OF THE TR-48 AND THETR-20. THE TOTAL CAPACITY OF THE PROPOSED SYSTEM WOULD ACTUALLY BE DEGRADED WITH ANY 100 VOLT SYSTEM, INCLUDING SYSTRON-DONNER-S. THIS IS BECAUSE ONE EXTRA OR SYSTEM AMPLIFIER WOULD HAVE TO BE USED FOR EACH SIGNAL SENT BETWEEN THE COMPUTERS IF THEY ARE TO BE OPERATED AT THEIR DESIGNED OR DESIRED VOLTAGE LEVEL. ALSO, THE POSSIBILITY OF DAMAGE (OR HOPEFULLY ONLY BLOWN FUSES) EXISTS WHEN STUDENTS USE THE SLAVED MODE TO COUPLE 100 VOLTS TO THE 10 VOLT SYSTEM. FURTHERMORE, THE 100 VOLT SYSTEM USES APPROXIMATELY 650 WATTS OF ELECTRICAL POWER. THIS, COUPLED WITH THE POWER TO OPERATE THE TR -20 AND ASSOCIATED READOUT EQUIPMENT, EXCEEDS THE CAPABILITY OF THE CURRENT WIRING SYSTEM IN THE SCHOOL BUILDING AND WOULD CAUSE ALL THE CLASSROOM LIGHTS TO GO OUT. SUCH CONDITIONS ARE UNACCEPTABLE TO THE TEST PILOT SCHOOL.

"C. WITH THE REQUESTED TR-48 COUPLED TO THE TR-20, STUDENT TRAINING WILL BE GREATLY ENHANCED BY THE USE OF TWO EAI COMPUTERS VICE COMPUTERS OF TWO DIFFERENT MANUFACTURERS. FOR INSTANCE, THE TR-48 AND TR-20 DESIRED HAVE IDENTICAL NOTATIONS FOR MODES OF OPERATION, COMMON COLOR CODING, IDENTICAL METER SCALES, RANGE SELECTION AND OVERLOAD WARNING SYSTEMS. THE U.S. NAVAL ACADEMY AT ANNAPOLIS HAS FOUND THIS TO BE A SIGNIFICANT FEATURE IN THE TRAINING AND DEMONSTRATION ENVIRONMENT.

"D. FURTHER JUSTIFICATION IS THE LIGHT WEIGHT OF THE TR-48. THE EQUIPMENT WILL BE MOVED FREQUENTLY FROM THE LABORATORY TO THE CLASSROOM (DAILY FOR APPROXIMATELY 40 PERCENT OF THE TIME). AT APPROXIMATELY 350 LB, ONE MAN CAN READILY MOVE THE TR-48 FROM THE LABORATORY ON ITS TRANSPORTER-BENCH TO THE CLASSROOM. OTHER PROJECTS AT NATC WILL REQUIRE THAT THE COMPUTER BE MOVED FROM TPS TO THE OTHER TEST DIVISIONS. FOR EXAMPLE, A VARIABLE GAIN STABILITY AUGMENTATION AIRCRAFT SYSTEM IS TO BE EVALUATED IN THE NEAR FUTURE WITH THE FLIGHT TEST DIVISION. THE COMPUTER WILL BE MOVED FROM THE SECOND FLOOR OF THE TPS BUILDING TO THE TELEMETRY STATION WHERE IT WILL BE USED TO CALIBRATE AND CHECK THE AIRBORNE EQUIPMENT. A TYPICAL 100 VOLT SYSTEM WILL NORMALLY WEIGH ABOUT TWICE AS MUCH AS THE PROPOSED EAI COMPUTER. THE TEST PILOT SCHOOL DOES NOT HAVE THE EXTRA MANPOWER NECESSARY TO MOVE THE 700 LB. SYSTEM.

"E. THE RELATIVELY SMALL SIZE OF THE TR-48 IS A PRIME FACTOR. THE TRANSPORTER-BENCH WILL BE DESIGNED TO GIVE 1/2 INCH CLEARANCE ON THE SIDES AND A 10 INCH DESK AREA IN FRONT OR BEHIND THE COMPUTER. THIS TRANSPORTER -BENCH WITH THE COMPUTER MOUNTED ON TOP MUST BE MOVED BY ONE MAN FROM THE LABORATORY THROUGH NORMAL DOORS, AROUND CORNERS, AND UP THE CENTER AISLE OF THE CLASSROOM TO THE DEMONSTRATION POSITION. THE TR-48 IS OF THE LARGEST PRACTICAL SIZE THAT CAN BE SO MANEUVERED BY ONE INSTRUCTOR. SINCE LOW VOLTAGE MACHINES ARE INHERENTLY SMALLER, AND APPROXIMATELY 35 PERCENT SMALLER THAN 100 VOLT SYSTEM, SIZE BECOMES A PRIMARY FACTOR IN THE PROCUREMENT OF THIS COMPUTER FOR THE TEST PILOT SCHOOL. A MOCKUP OF THE TRANSPORTER-BENCH FOR THE TR-48 AND THE SYSTRON-DONNER COMPUTER WERE MADE TO JUDGE THE MANEUVERABILITY. IT WAS NOT POSSIBLE FOR ONE MAN TO MANEUVER THE LARGE SYSTRON-DONNER MOCKUP IN THE RESTRICTED SPACE AVAILABLE. IT IS NOT DESIRABLE TO ENLARGE DOORS, AND CHANGE THE SCHOOL FLOOR PLAN TO ACCEPT THE SYSTRON DONNER COMPUTER.

"F. THE ELECTRICAL POWER CONSUMPTION OF THE TR-48 IS APPROXIMATELY 150 WATTS. THIS COMPARES TO A POWER REQUIREMENT OF APPROXIMATELY 650 WATTS IN A TYPICAL 100 VOLT SYSTEM. THE TEST PILOT SCHOOL BUILDING HAS EXTREMELY LIMITED WIRING CIRCUITS. WE ARE UNABLE TO USE A 650 WATT COMPUTER WITH THE ASSOCIATED READOUT EQUIPMENT IN THE CURRENT ENVIRONMENT. WE HAVE HAD TO DISCONTINUE USE OF OTHER HIGH WATTAGE EQUIPMENT IN THE CLASSROOMS. REWIRING THE SCHOOL BUILDING WOULD BE AN UNNECESSARY ADDITIONAL EXPENSE TO THE GOVERNMENT.

"G. MR. ENOCH DURBIN OF PRINCETON UNIVERSITY GRADUATE SCHOOL HAS HIGHLY RECOMMENDED THE TR-48 SYSTEM TO US BECAUSE OF THE RELIABILITY OF THE EAI EQUIPMENT IN OUR OPERATING ENVIRONMENT.'

UPON BEING SUPPLIED WITH A COPY OF THESE REASONS, SYSTRON-DONNER HAS TAKEN THE POSITION THAT ITS SD-40 MODEL ANALOG COMPUTER COULD BE MODIFIED TO MEET THE REQUIREMENTS LISTED BY NAS AS JUSTIFICATION FOR THE SOLE SOURCE PROCUREMENT, WHEREAS, IN THE PRIOR ADVERTISED PROCUREMENT THE CORPORATION HAD BID ON ITS FULLY EXPANDED SD-80 MODEL. IN THIS REGARD IT ALSO SHOULD BE NOTED THAT NAVY'S OPINION CONCERNING SYSTRON-DONNER'S ABILITY TO MEET ITS REQUIREMENTS WAS APPARENTLY BASED UPON AN EVALUATION OF THE CORPORATION'S ORIGINAL BID OF A FULLY EXPANDED MODEL. IN REPLYING TO NAVY'S JUSTIFICATION FOR SOLE SOURCING THIS PROCUREMENT, SYSTRON-DONNER HAS PRESENTED IN A LETTER TO THIS OFFICE DATED MAY 8, 1967, THE FOLLOWING POINTS FOR CONSIDERATION (WHICH FOLLOW THE SAME LETTER SEQUENCE AS THE ABOVE QUOTED JUSTIFICATION BY NAVY): "A. THE IMPLICATION THAT THE EAI TR 20 CANNOT BE SLAVED TO THE SYSTRON-DONNER SD-40 IS ERRONEOUS. SLAVING OF DIFFERENT MANUFACTURER'S COMPUTERS IS COMMON THROUGHOUT THE COUNTRY. "WE OFFERED TO DEMONSTRATE THIS TO THE ENGINEER BUT HE REJECTED THE OFFER OUT OF HAND. "B. THE IMPLICATION OF THE FIRST PART OF THIS STATEMENT IS THAT MODULES CAN BE SWITCHED BETWEEN THE TR 20 AND TR-48. EAI WILL READILY ADMIT THAT THIS CANNOT BE DONE. "THE SECOND STATEMENT THAT A 100 VOLT SYSTEM NEEDS ADDITIONAL AMPLIFIERS FOR EACH SIGNAL BETWEEN -SLAVED- COMPUTERS IS COMPLETELY FALSE. IF THE ENGINEER REALLY BELIEVES THIS, IT SHOWS A COMPLETE LACK OF KNOWLEDGE ABOUT ANALOG COMPUTERS. IN FACT, TO CHANGE A 100 VOLT ANALOG AMPLIFIER TO A 10 VOLT ANALOG AMPLIFIER REQUIRES THE MOVING OF THE PATCH CORD (WHICH MUST BE THERE ANYWAY) TO ANOTHER POSITION. "THE POSSIBILITY OF DAMAGE OF THE EAI TR-20 (OR EVEN BLOWN FUSES) BY SLAVING TO THE SYSTRON-DONNER SD-40 IS NON-EXISTENT. THE SYSTRON DONNER SD-40 VOLTAGE AND CURRENT LIMITING CIRCUITS PRECLUDE ANY POSSIBILITY OF DAMAGING ANY MANUFACTURERS EQUIPMENT INCLUDING THE EAI TR- 20. "THE 650 WATTS SPECIFIED IN THE SYSTRON-DONNER CATALOG IS FOR A FULLY EXPANDED UNIT WITH ADDITIONAL POWER SUPPLIES FOR OPTIONAL DIGITAL LOGIC. THIS IS TWICE THE CAPACITY OF THE EAI TR-48. THE COMPLEMENT OF EQUIPMENT WHICH SYSTRON-DONNER OFFERED TO MEET THIS REQUIREMENT WOULD DRAW A MAXIMUM OF 300 WATTS. THE DIFFERENCE IN POWER REQUIREMENTS OF 150 WATTS IS EQUIVALENT TO AN ORDINARY 150 WATT LIGHT BULB, USED IN ANY TABLE LAMP. SURELY THE WIRING IN THE SCHOOL CANNOT BE SO INADEQUATE THAT THE PLUGGING- IN OF A TABLE LAMP WOULD CAUSE A CATASTROPHIC FAILURE TO THE WIRING IN THE SCHOOL. "WE OFFERED TO DEMONSTRATE ALL THE ABOVE POINTS TO THE ENGINEER BUT HE REJECTED THE OFFER OUT OF HAND. "C. THE STATE OF THE ART IN ANALOG COMPUTATION IS SUCH THAT PROGRAMMING TECHNIQUES, MODES OF OPERATION, ETC., ARE ESSENTIALLY IDENTICAL BETWEEN DIFFERENT MANUFACTURER'S EQUIPMENT. FACT, COLLEGE AND EVEN HIGH SCHOOL STUDENTS FIND NO DIFFICULTY IN USING EAI EQUIPMENT ONE DAY AND SYSTRON-DONNER EQUIPMENT THE FOLLOWING DAY. ONE OF THE GREAT ADVANTAGES OF ANALOG COMPUTATION IS THE SIMPLICITY OF PHYSICALLY PROGRAMMING. THE -STATEMENT- IS ANALOGOUS TO SAYING THAT A PERSON WHO DRIVES A FORD ONE DAY WOULD BE HARD PRESSED TO OPERATE A CHEVY THE NEXT. SURELY, TRAINED NAVAL PERSONNEL ARE AS FLEXIBLE AS COLLEGE AND HIGH SCHOOL STUDENTS. "WE OFFERED TO DEMONSTRATE THIS FACT BY HAVING A STUDENT PROGRAM A PROBLEM ON THE SYSTRON-DONNER COMPUTER WITHOUT ANY PRIOR INSTRUCTIONS. THE ENGINEER TURNED DOWN THE OFFER OUT OF HAND. "D. THE FULLY EXPANDED SYSTRON-DONNER UNIT DOES WEIGH 700 POUNDS. THIS, HOWEVER, IS TWICE THE CAPACITY OF THE TR-48. THE UNIT SYSTRON-DONNER OFFERED TO MEET THIS REQUIREMENT WEIGHED 375 POUNDS. SURELY A 24 POUND DIFFERENCE DOES NOT REQUIRE -EXTRA MANPOWER.- "E. ONE OF THE GREAT ADVANTAGES OF THE SYSTRON-DONNER COMPUTER IS THE FACT THAT IT IS EXPANDABLE. FULLY EXPANDED WITH BOTH COMPUTER BAYS, THE OVERALL LENGTH IS 68 INCHES. THE COMPLEMENT NEEDED FOR THIS APPLICATION REQUIRES ONLY ONE BAY WHICH REDUCES THE LENGTH BY 20 INCHES OR THE TOTAL LENGTH IS 48 INCHES. THE EAI COMPUTER IS LISTED IN THEIR LITERATURE AS 48 INCHES LONG. THE SYSTRON-DONNER SD40 AND THE EAI TR-48 ARE BOTH 48 INCHES LONG. THE EAI TR-48 COMPUTER IS LISTED AS 20 -1/4 INCHES WIDE. THE SYSTRON DONNER SD-40 IS 23 INCHES WIDE. THE DIFFERENCE IS 2-1/4 INCHES. THIS FITS WELL WITHIN THE ENGINEERS 10 INCH CLEARANCE FRONT AND BACK. SURELY THE DOORS AT THE SCHOOL ARE NOT EXACTLY 20-1/4 INCHES WIDE. IF THEY ARE, THIS PRESENTS AN EXTREME HAZARD WHEN COUPLED WITH THE WIRING WHICH CAN FAIL WHEN A TABLE LAMP IS PLUGGED IN ANYWHERE IN THE SCHOOL. "WE DO NOT KNOW ABOUT ANY -MOCK-UP- OF OUR UNIT BUT OFFERED TO BRING A UNIT INTO THE SCHOOL TO DEMONSTRATE THAT THE SIZE AND WEIGHT WERE ESSENTIALLY IDENTICAL WITH THE EAI TR-48. THE ENGINEER REJECTED THIS OFFER OUT OF HAND. "F. WE HAVE DISCUSSED THE DIFFERENCE IN POWER CONSUMPTION UNDER -B-. WE WILL POINT OUT AGAIN THAT THE DIFFERENCE IN POWER REQUIRED IS EQUAL TO AN ORDINARY TABLE LAMP. THIS CONTINUOUS ATTEMPT TO INFER THAT A DIFFERENCE OF 150 WATTS CAN CAUSE CATASTROPHIC FAILURE IN THE WIRING OF A BUILDING EITHER INDICATES A LACK OF KNOWLEDGE OR AN ATTEMPT TO CONFUSE NONTECHNICAL PEOPLE WHO DO NOT EQUATE WATTS WITH SINGLE HOUSEHOLD APPLIANCES. FOR EXAMPLE, AN ORDINARY TOASTER USED IN THE KITCHEN IN MOST HOMES DRAWS OVER 1000 WATTS OR THREE TIMES MORE WATTS THAN THE SYSTRON-DONNER COMPUTER. "G. WE HAVE NO IDEA WHO MR. ENOCH DURBIN IS OR WHY HIS RECOMMENDATION IS GERMANE TO A -STATEMENT OF FACTS-. WE FEEL, HOWEVER, THAT THE INCLUSION OF SUCH A -FACT- IS INDICATIVE OF THE LACK OF REAL JUSTIFICATION FOR GOING SOLE SOURCE.'

IN VIEW OF SYSTRON-DONNER'S REPRESENTATIONS THAT ITS SD-40 MODEL COULD SATISFY NAVY'S REQUIREMENTS AND SINCE THE RECORD AT THIS POINT DID NOT INDICATE THAT NAS HAD EVEN CONSIDERED THIS POSSIBILITY, A COPY OF SYSTRON- DONNER'S LETTER OF MAY 8 WAS TRANSMITTED TO NAS FOR CONSIDERATION AND WE REQUESTED A DOCUMENTED SUPPLEMENTAL REPORT RESPONSIVE TO THE CORPORATION'S ADDITIONAL ALLEGATIONS. FROM OUR REVIEW OF NAVY'S SUPPLEMENTAL REPORT DATED JUNE 6, 1967, IT BECAME CLEAR THAT NAVY'S EVALUATION OF THE SYSTRON- DONNER COMPUTER DIFFERED FROM REPRESENTATIONS MADE BY THE CORPORATION ITSELF. IN AN ATTEMPT TO FINALLY RESOLVE THESE DIFFERENCES A CONFERENCE WAS CONDUCTED BETWEEN PERSONNEL FROM NAS, NAVSUP, AND THIS OFFICE. AS A RESULT OF THIS CONFERENCE, AND IN ACCORDANCE WITH ASPR 1-1002.1, NAS AGREED TO PROVIDE SYSTRON-DONNER WITH A COPY OF THE RFP AND TO ACCEPT AND FULLY EVALUATE THE CORPORATION'S WRITTEN PROPOSAL. THE RECORD INDICATES THAT ON JUNE 26, 1967, SYSTRON-DONNER SUBMITTED A PROPOSAL CONTAINING THREE ALTERNATIVES AT LOWER PRICES THAN THE EAI-TR48 COMPUTER. THEY ARE: (1) AN SD40-SPM ANALOG COMPUTER SYSTEM WHICH IS ESSENTIALLY A STANDARD SD40 MODEL THAT IS MODIFIED BY REMOVING STRUCTURE FOR WEIGHT SAVING PURPOSES (WEIGHT 400 LBS.) AND INCLUDES A SPECIAL POWER SUPPLY TO MEET THE NEGOTIATED REQUIREMENTS (DRAWS 280 WATTS); (2) A STANDARD SD40 MODEL WEIGHING 500 POUNDS AND DRAWING 500 WATTS WHICH WAS OFFERED AT A LOWER COST THAN THE SPM MODEL WHILE PROVIDING ENHANCED EXPANSION CAPABILITIES OVER THE SPM MODEL; AND (3) TWO SD10/20 ANALOG COMPUTER SYSTEMS.

AFTER EVALUATING THESE PROPOSALS NAS REPORTED ON AUGUST 23, 1967, THAT SYSTRON-DONNER'S THIRD PROPOSAL DEFINITELY WAS NOT ACCEPTABLE SINCE IT DID NOT PROVIDE FOR CERTAIN BASIC COMPONENTS. THIS REPORT ALSO THOROUGHLY EVALUATED THE TECHNICAL ASPECTS OF BOTH THE SD40 AND SD40-SPM MODELS, COMPARED THEM IN DETAIL TO THE EAI-TR48, AND CONCLUDED THAT THE LATTER WAS MORE ADVANTAGEOUS TO THE GOVERNMENT. IT IS APPARENT FROM THE DETAILED REPORT THAT IN CERTAIN RESPECTS THE EAI-TR48 COMPUTER IS SUPERIOR WHILE IN OTHERS, THE SYSTRON-DONNER MODELS ARE SUPERIOR. HOWEVER, WE NOTE THAT THE REPORT DOES NOT CONCLUDE, AS IT DOES IN THE CASE OF SYSTRON-DONNER'S THIRD PROPOSAL, THAT EITHER THE SD40 OR SD40-SPM IS NOT ACCEPTABLE, IN THAT IT DOES NOT MEET THE ACTUAL MINIMUM REQUIREMENTS OF THE GOVERNMENT. IN VIEW OF THE LONG STANDING CONTROVERSY IN THIS MATTER WE FEEL THAT THE CONTRACTING OFFICER WOULD HAVE DONE SO IF SUCH WERE THE CASE. CONCLUDING THAT THE EAI-TR48 WAS PREFERABLE TO THE SYSTRON-DONNER COMPUTER THE CONTRACTING OFFICER SET FORTH THE FOLLOWING CONTROLLING REASONS FOR HIS CHOICE:

"SUMMATION OF CONCLUSIONS "I. IN GENERAL, THE SD40 EXHIBITS SUPERIOR STATIC ACCURACY WHILE THE EAI-TR48 HAS SUPERIOR DYNAMIC PROPERTIES. THESE ARE TYPICAL CHARACTERISTICS. "II. WITHIN THE CONFINES OF THE PROPOSED COMPUTERS, THE EAI HAS THE GREATER GROWTH POTENTIAL; HOWEVER, IF THIS SIZE (AND WEIGHT) WERE NOT IMPORTANT, THE SD40 COMPUTER CABINET COULD BE REPLACED WITH THE LARGER SD80 AND HAVE AN EVEN GREATER GROWTH. BUT THEN THE EAI COMPONENTS COULD BE TRANSFERRED TO THEIR NEW MODEL AND GROW EVEN MORE. THIS LEADS TO NOWHERE SO A CONCLUSION MUST BE DRAWN ON THE BASIS OF THE COMPUTING CASE SUPPLIED. HENCE, THE EAI HAS THE GREATER GROWTH POTENTIAL. "III. THE EAI-TR48 IS SMALLER, REQUIRES MUCH LESS POWER AND IS SIGNIFICANTLY LIGHTER THAN THE TWO SD40 PROPOSALS. THESE CHARACTERISTICS AND TRENDS WHICH ARE TYPICAL OF A 10 VOLT SYSTEM AND THE FACT THAT A SMALL 10 VOLT SYSTEM AND OTHER EQUIPMENT ARE ON HAND, WERE THE REASONS AND ARE STILL THE REASONS FOR PREFERRING THIS SYSTEM. "IV. IT SHOULD ALSO BE NOTED THAT THE OFFER OF SYSTRON-DONNER IS UNACCEPTABLE IN CONFORMANCE WITH THE REQUEST FOR PROPOSAL IN THAT THEIR RESPONSE IS FOB CONCORD, CALIFORNIA, VICE DESTINATION AS SPECIFIED IN SECTION 4.0 OF THE RFP. "V. AFTER A COMPLETE EVALUATION OF BOTH SYSTEMS, THE EAI-TR48 COMPUTER IS STILL CONSIDERED TO BE MORE ADVANTAGEOUS IN MEETING THE REQUIREMENTS OF THE TEST PILOT SCHOOL AS ENUMERATED ABOVE. BASED ON THE FACTS PRESENTED, THE CONTRACTING OFFICER STILL CONSIDERS THAT HE HAS RECEIVED FULLY SUFFICIENT INFORMATION TO JUSTIFY THE PROCUREMENT OF THE EAI-TR48 ANALOG COMPUTER.'

ADDITIONALLY, IN A SUPPLEMENTAL REPORT DATED OCTOBER 25, 1967, THE CONTRACTING OFFICER STATES THAT NAS NOW INTENDS TO PROCEED WITH ITS PLAN TO USE THE NEW COMPUTER IN A HELICOPTER WHERE WEIGHT, SIZE AND POWER REQUIREMENTS ARE CRITICAL. THIS REPORT POINTS OUT VARIOUS SECTIONS OF THE SPECIFICATIONS NOT MET BY THE SYSTRON-DONNER PROPOSALS WHICH DEAL WITH THE COMPUTER'S DYNAMIC PROPERTIES AND THE FUSING OF POTENTIOMETERS.

WHILE IN NEGOTIATED PROCUREMENTS THE CONTRACTING OFFICER HAS A GREATER DEGREE OF DISCRETION IN EFFECTING SUCH PROCUREMENTS THAN IN FORMALLY ADVERTISED PROCUREMENTS, THE STATUTE REQUIRES THAT PROPOSALS BE SOLICITED FROM THE MAXIMUM NUMBER OF QUALIFIED SOURCES CONSISTENT WITH THE NATURE AND REQUIREMENTS OF THE SUPPLIES OR SERVICES TO BE PROCURED. 10 U.S.C. 2304G. FURTHER, ASPR 1-1201 PROVIDES THAT PLANS, DRAWINGS, SPECIFICATIONS OR PURCHASE DESCRIPTIONS FOR PROCUREMENTS SHALL STATE ONLY THE ACTUAL MINIMUM NEEDS OF THE GOVERNMENT, DESCRIBE THE SUPPLIES AND SERVICES IN A MANNER WHICH WILL ENCOURAGE MAXIMUM COMPETITION, AND ELIMINATE, INSOFAR AS IS POSSIBLE, ANY RESTRICTIVE FEATURES WHICH MIGHT LIMIT ACCEPTABLE OFFERS TO ONE SUPPLIER'S PRODUCT, OR THE PRODUCT OF A RELATIVELY FEW SUPPLIERS. IN ADDITION THE LEGISLATIVE HISTORY OF THE ARMED SERVICES PROCUREMENT ACT OF 1947 SHOWS THAT CONGRESS SPECIFICALLY DELETED AUTHORITY TO NEGOTIATE CONTRACTS FOR THE PURPOSE OF SECURING A PARTICULAR QUALITY OF MATERIALS, WHICH WE HAVE CONSTRUED AS A PROHIBITION AGAINST THE NEGOTIATION OF CONTRACTS WITHOUT PRICE COMPETITION. 43 COMP. GEN. 353, 370; 41 ID. 484.

WITH REGARD TO THE PROPOSED AIRBORNE APPLICATION OF THE COMPUTER WE NOTE THAT THE SPECIFICATIONS DO NOT STATE SUCH TO BE A REQUIREMENT AND THE SYSTRON-DONNER REPRESENTATIVE CONTENDS THAT AT NO TIME DID NAS CONVEY THE IDEA THAT A COMPUTER WOULD BE SELECTED ON THIS BASIS. THE POSITION TAKEN BY SYSTRON-DONNER IS CONSISTENT WITH THE ORAL STATEMENTS MADE BY NAS PERSONNEL DURING THE ABOVE MENTIONED CONFERENCE WITH REPRESENTATIVES OF THIS OFFICE TO THE EFFECT THAT AIRBORNE USE WAS NOT SUFFICIENTLY CERTAIN AT THAT TIME AND COULD NOT BE CONSIDERED AS JUSTIFICATION FOR PURSUING A SOLE SOURCE PROCUREMENT. THEREFORE WE BELIEVE IT WOULD BE IMPROPER TO EVALUATE PROPOSALS ON THIS BASIS SINCE A DEFINITE STATEMENT OF THE GOVERNMENT'S ACTUAL NEEDS IN THIS REGARD WAS NOT PROVIDED TO THE OFFERORS. FURTHERMORE SYSTRON-DONNER ALSO CONTENDS THAT BOEING AND SIKORSKY ARE PRESENTLY FLYING ITS COMPUTERS WHICH HAVE BEEN "RUGGEDIZED" FOR OPERATION DURING VIBRATION AND THAT NEITHER THE EAI NOR THE SYSTRON- DONNER STANDARD COMPUTERS WILL OPERATE PROPERLY IN SUCH AN ENVIRONMENT.

CONCERNING THE IMPORTANCE ATTACHED BY NAS TO ITS STATED WEIGHT REQUIREMENTS OTHER THAN FOR AIRBORNE APPLICATION WE ARE UNABLE TO AGREE THAT A 100 POUND DIFFERENCE (MAXIMUM) IN WEIGHT BETWEEN THE EAI TR48 AND SD40-SPM IS A SUBSTANTIAL BASIS FOR JUSTIFYING PURCHASE OF THE HIGHER PRICED ITEM, ESPECIALLY SINCE THE COMPUTER WILL BE TRANSPORTED ON A MOVEABLE TABLE.

WITH REGARD TO THE CRITICAL ELECTRICAL SITUATION EXISTING AT NAS WE NOTE THAT DURING THE CONFERENCE WITH REPRESENTATIVES OF THIS OFFICE NAS TECHNICAL PERSONNEL WERE SPECIFICALLY QUESTIONED AS TO WHETHER A UNIT DRAWING 300 WATTS COULD BE SATISFACTORILY OPERATED UNDER THE CRITICAL CONDITIONS EXISTING AT PATUXENT RIVER. THEIR REPLY IN ESSENCE WAS IDENTICAL TO THE NAS STATEMENT CONTAINED IN THE REPORT OF JUNE 6, 1967, THAT ANY ADDITIONAL ELECTRICAL USE COULD CAUSE A FUSE TO BLOW. SYSTRON- DONNER, ON THE OTHER HAND, CONTENDS THAT THE 280 WATTS REQUIRED BY ITS SPM COMPUTER IS NOT EXCESSIVE AND IN FACT ITS USE DRAWS LESS WATTAGE THAN MANY ORDINARY HOUSEHOLD FIXTURES AND APPLIANCES. UNDER THESE CIRCUMSTANCES WE MUST TAKE THE POSITION THAT IT WOULD BE IMPROPER TO ELIMINATE THE LOWER PRICED COMPUTER FROM CONSIDERATION FOR AWARD SINCE IT IS ALSO POSSIBLE THAT THE EAI-TR48 MIGHT CAUSE FUSES TO BLOW WHILE OPERATING UNDER THE REPORTED DEFICIENT ELECTRICAL CONDITIONS EXISTING AT NAS, THE DIFFERENCE IN LOAD BETWEEN THE TWO BEING NO GREATER THAN WOULD BE CREATED BY TURNING ON AN ORDINARY 150 OR 200 WATT LIGHT BULB.

CONCERNING THE FAILURE OF SYSTRON-DONNER TO OFFER THE DELIVERY OF ITS COMPUTER ON AN F.O.B. DESTINATION BASIS AS REQUIRED BY THE RFP, THE SYSTRON-DONNER REPRESENTATIVE HAS ADVISED THIS OFFICE IN WRITING (THE ORIGINAL IS ENCLOSED) THAT ITS OFFER SHOULD BE CHANGED TO COMPLY WITH THE RFP REQUIREMENT WITHOUT ANY CHANGE IN BID PRICE. INASMUCH AS NO CLOSING DATE FOR SUBMISSION OF PROPOSALS WAS FIXED BY THE REP, AND NO AWARD HAS BEEN MADE, THIS DETAIL IS STILL OPEN TO NEGOTIATION AND WE BELIEVE IT WOULD BE IN THE INTEREST OF THE GOVERNMENT TO CONSIDER THIS OFFER AS A MODIFICATION OF SYSTRON-DONNER'S PROPOSAL IN ACCORDANCE WITH ASPR 3-805.1 (B).

CONCERNING THE REQUIREMENTS IN THE SPECIFICATIONS RELATIVE TO THE COMPUTER'S DYNAMIC PROPERTIES AND THE FUSING OF POTENTIOMETERS WE NOTE THAT THESE FACTORS WERE FIRST CONSIDERED IN THE NAS REPORT OF AUGUST 23, 1967, IN WHICH THE CONTRACTING OFFICER CONCLUDES THAT HE CONSIDERS THE EAI -TR48 TO BE MORE ADVANTAGEOUS TO THE GOVERNMENT. THE REPORT OF OCTOBER 25 MERELY RESTATES THE PREVIOUS CONCLUSION. SINCE IT DOES NOT APPEAR THAT THE SYSTRON-DONNER COMPUTER WILL NOT MEET THE GOVERNMENT'S MINIMUM NEEDS IN THIS REGARD IT WOULD BE IMPROPER TO ELIMINATE A LOWER PRICED COMPUTER FROM CONSIDERATION FOR AWARD FOR THIS REASON.

LASTLY, WE FIND NO SUBSTANTIAL BASIS FOR JUSTIFYING THE PROCUREMENT OF A COMPUTER AT A SIZEABLE HIGHER COST MERELY BECAUSE IT IS MORE COMPATIBLE WITH A COMPUTER IN OPERATION AT NAS WHEN, UPON TECHNICAL EVALUATION, IT CANNOT BE DETERMINED THAT THE LOWER PRICED COMPUTER IS UNACCEPTABLE FOR THE PROPOSED USE.

IN CONCLUSION WE ARE CONVINCED IN THIS CASE THAT A SUBSTANTIAL BASIS HAS NOT BEEN PRESENTED TO JUSTIFY THE PURCHASE OF THE EAI-TR48 AT A HIGHER COST TO THE GOVERNMENT, AND WE DO NOT BELIEVE THAT THE PROCURING ACTIVITY'S FAILURE TO REVISE THE SPECIFICATIONS TO REFLECT ITS ACTUAL NEEDS AND SOLICIT COMPETITION, IN THE FACE OF NAVY'S DEFINITE COMMITMENT TO DO SO, TENDS TO PROMOTE PUBLIC CONFIDENCE IN THE INTEGRITY OF THE COMPETITIVE PROCUREMENT SYSTEM WHICH IN THE LONG RUN IS ESSENTIAL TO THE CONTINUED REALIZATION BY THE GOVERNMENT OF THE ADVANTAGES INHERENT THEREIN. SEE ASPR 1-113.1.

FOR THE REASONS STATED WE BELIEVE THE PROPOSED AWARD TO EAI WOULD BE IMPROPER, AND WE WOULD BE CONSTRAINED TO APPLY THIS VIEW IN THE AUDIT OF EXPENDITURES OF APPROPRIATED FUNDS UNDER SUCH CONTRACT.

IN REACHING THIS DECISION WE HAVE ASSUMED THAT THE PROCUREMENT OF THE ITEM INVOLVED IS WITHIN THE AUTHORITY OF YOUR DEPARTMENT. HOWEVER, IF FURTHER ACTION SHOULD BE CONTEMPLATED IN THIS CONNECTION, WE ADVISE THAT THE QUESTION OF PROCUREMENT AUTHORITY BE RECONSIDERED IN THE LIGHT OF THE PROVISIONS OF P.L. 89-306 AND OUR DECISION OF NOVEMBER 21, 1967, B-151204, B-157587.

TRANSMITTED HEREWITH ARE THE FILES RECEIVED WITH THE ADMINISTRATIVE REPORTS AND, FOR YOUR INFORMATION, COPIES OF SYSTRON-DONNER CORRESPONDENCE IN THIS MATTER.