B-167389 (1), APR. 30, 1970

B-167389 (1), APR. 30, 1970

CONTRACTS--NEGOTIATION--DETERMINATION AND FINDINGS--REVISION, AMENDMENT, ETC. CONTRACT FOR 380 HOUSES (200 IN TURKEY AND 180 IN GREECE), ENTERED INTO UNDER DETERMINATION AND FINDING WHICH ONLY GRANTED AUTHORITY TO NEGOTIATE CONTRACT FOR 300 HOUSES IN TURKEY AND WHICH THUS DID NOT REASONABLY AND FAIRLY DESCRIBE ACTUAL PROCUREMENT, IS SUSTAINED, AS ADMINISTRATIVE FAILURE TO COMPLY WITH STATUTORY PROVISION (10 U.S.C. 2310 (B)) REQUIRING WRITTEN FINDING SUPPORTING DECISION TO NEGOTIATE PROCUREMENT OF GREEK HOUSING DOES NOT ALONE ESTABLISH LACK OF NEGOTIATING AUTHORITY UNDER 10 U.S.C. 2304 (A) (2). REQUISITE AUTHORITY EXISTED BECAUSE OF "PUBLIC EXIGENCY," AS RESPONSIBLE ADMINISTRATORS INTERPRETED CIRCUMSTANCES AS DEMONSTRATING THAT GOVERNMENT'S NEEDS WOULD NOT PERMIT DELAY INCIDENT TO ADVERTISING. SEE B-164313, JULY 5, 1968.

TO COVINGTON & BURLING:

BY LETTER DATED FEBRUARY 17, 1970, YOU REQUESTED RECONSIDERATION OF OUR DECISION TO YOU, DATED FEBRUARY 12, 1970, CONCERNING THE PROTEST BY MODULUX, INC; AGAINST THE AWARD OF A CONTRACT TO ELDER-OILFIELD, INC; UNDER REQUEST FOR PROPOSALS (RFP) NO. F41621-69-R-0348, ISSUED BY THE UNITED STATES AIR FORCE SECURITY SERVICE, SAN ANTONIO, TEXAS.

WE DELAYED RESPONDING TO YOUR LETTER BECAUSE WE INTENDED TO REPORT TO YOU CONCERNING THE APPLICABILITY TO THIS PROCUREMENT OF THE UNIFORM MATERIEL MOVEMENT AND ISSUE PRIORITY SYSTEM (UMMIPS). YOU WILL RECALL, IN THIS CONNECTION, THAT ON PAGE 15 OF OUR FEBRUARY 12 DECISION WE INDICATED SERIOUS DOUBT THAT UMMIPS WAS PROPERLY APPLICABLE TO THE PROCUREMENT ON A TURNKEY BASIS OF PREFABRICATED MILITARY HOUSING. WE ADVISED YOU THAT WE WERE SOLICITING THE VIEWS OF THE SECRETARY OF THE AIR FORCE ON THIS QUESTION.

IN A LETTER FROM THE AIR FORCE DATED MARCH 27, 1970, WE WERE PROVIDED WITH THE AGENCY'S INITIAL COMMENTS ON THE MATTER. HOWEVER, WE ARE CONTINUING OUR INQUIRY AND WE EXPECT TO RECEIVE FURTHER INFORMATION IN THIS REGARD AT A LATER DATE. ACCORDINGLY, AT THIS TIME, WE EXPRESS NO OPINION AS TO THE PROPRIETY OF UTILIZING UMMIPS UNDER THE CIRCUMSTANCES PRESENT IN THIS CASE.

WE HAVE REVIEWED THE FEBRUARY 12 DECISION AND, AS TO THE MATTERS DISCUSSED THEREIN, WE FIND NO BASIS FOR CONCLUDING THAT OUR DECISION WAS ERRONEOUS. HOWEVER, YOU CORRECTLY OBSERVE IN YOUR LETTER OF FEBRUARY 17 THAT CERTAIN OF YOUR CONTENTIONS WERE NOT INDIVIDUALLY TREATED IN OUR DECISION. THESE CONTENTIONS WERE ADVANCED IN YOUR LETTERS OF AUGUST 28 AND OCTOBER 1, 1969.

IN YOUR AUGUST 28 LETTER YOU MADE THE FOLLOWING ARGUMENT:

"THE CONTRACT WITH ELDER COVERS 200 HOUSING UNITS FOR KARAMURSEL, TURKEY, AND 180 HOUSING UNITS FOR IRAKLION, GREECE (CRETE). IT PURPORTS TO HAVE BEEN NEGOTIATED UNDER 10 U.S.C. 2304 (A) (2), THE PUBLIC EXIGENCY EXCEPTION. ASPR (ARMED SERVICES PROCUREMENT REGULATION) 3-202.3 REQUIRES THAT EVERY CONTRACT NEGOTIATED UNDER THIS EXCEPTION 'SHALL BE ACCOMPANIED WITH A DETERMINATION AND FINDING (D&F) JUSTIFYING ITS USE (AND) SIGNED BY THE CONTRACTING OFFICER .....' ASPR 3-301 (D) STATES THAT 'THE AUTHORITY TO NEGOTIATE GRANTED BY A D&F IS LIMITED TO THE PROCUREMENT WHICH IS REASONABLY AND FAIRLY DESCRIBED IN THE D&F.' IT ALSO PERMITS INCLUSION IN THE D&F OF A PROVISION AUTHORIZING INCREASED QUANTITIES UNDER CERTAIN CIRCUMSTANCES. SIMILARLY, WHERE AN OPTION PROVISION IN THE CONTRACT IS CONTEMPLATED, ASPR 3-301 (E) REQUIRES THAT THE D&F SET FORTH THE APPROXIMATE QUANTITY TO BE AWARDED INITIALLY AND THE EXTENT OF THE INCREASE TO BE PERMITTED BY THE OPTION.

"THE D&F, EXECUTED ON FEBRUARY 25, 1969, BY THE CONTRACTING OFFICER TO AUTHORIZE NEGOTIATION UNDER 10 U.S.C. 2304 (A) (2) IS FOR 'AN INDIVIDUAL CONTRACT' FOR '200 EACH FAMILY HOUSING UNITS FOR KARAMURSEL AIR STATION, TURKEY, AND DATA WITH OPTION TO INCREASE QUANTITY BY 50%.' OTHER THAN THROUGH THE OPTION FOR A 50% INCREASE IN QUANTITY, THE D&F DID NOT BY ITS TERMS AUTHORIZE ANY PROCUREMENT OF ANYTHING BEYOND THE 200 HOUSES FOR KARAMURSEL. THE ORIGINAL RFP, DATED FEBRUARY 27, 1969, CONFORMED TO THIS D&F.

"BY RFP AMENDMENT #2, DATED MARCH 25, 1969, 'OPTION ITEM 4' WAS ADDED TO THE RFP IN SUBSTITUTION FOR THE 50% QUANTITY INCREASE OPTION PREVIOUSLY INCLUDED IN THE RFP. THIS ITEM CONSISTED OF 180 FAMILY HOUSING UNITS FOR IRAKLION AIR STATION, WHICH IS LOCATED ON GREEK TERRITORY SEVERAL HUNDRED MILES FROM KARAMURSEL. ALTHOUGH THE RFP WAS THUS AMENDED, THE D&F WAS NOT.

"THE CONTRACTING OFFICER HAS INFORMED THE UNDERSIGNED THAT THE ONLY D&F EXECUTED AT ANY TIME TO JUSTIFY NEGOTIATION OF THE CONTRACT EVENTUALLY AWARDED TO ELDER IS THE D&F DATED FEBRUARY 25, 1969. IT IS THEREFORE UNDISPUTED THAT A CONTRACT COVERING PROCUREMENT, ASSEMBLY, TRANSPORTATION, AND ERECTION OF 380 HOUSES -- 200 FOR TURKEY AND 180 FOR CRETE -- WAS ENTERED INTO UNDER A D&F WHICH GRANTED AUTHORITY TO NEGOTIATE A CONTRACT FOR, AT MOST, 300 HOUSES, ALL IN TURKEY. FROM THESE FACTS IT MUST BE OBVIOUS THAT THE PROCUREMENT ACTUALLY NEGOTIATED WAS NOT 'REASONABLY AND FAIRLY DESCRIBED IN THE D&F' AS REQUIRED BY ASPR 3-301 (D). THE AWARD OF THE CONTRACT WAS THEREFORE UNLAWFUL AND SHOULD BE SET ASIDE." THE OCTOBER 1 LETTER INCLUDES THE FOLLOWING:

"THE AIR FORCE CONCEDES THAT NO D&F JUSTIFYING NEGOTIATION WAS ISSUED WITH RESPECT TO THE 180 HOUSES FOR IRAKLION. THE AIR FORCE POSITION SEEMS TO BE THAT, SINCE THE PROPOSERS WERE MADE AWARE THAT THE KARAMURSEL RFP HAD BEEN AMENDED TO INCLUDE IRAKLION AND SINCE THEY MADE THEIR FINAL PROPOSALS ON THAT BASIS, THERE IS NO GROUND FOR COMPLAINT.

"THIS RESPONSE MISSES THE POINT. A D&F IS NOT A DOCUMENT DESIGNED TO GIVE PROSPECTIVE BIDDERS A REASONABLE AND FAIR DESCRIPTION OF A PROJECT; INDEED, IT IS A DOCUMENT WHICH PROSPECTIVE BIDDERS NORMALLY NEVER SEE. D&F'S FUNCTION IS TO PROVIDE LEGAL AUTHORITY FOR A PROPOSED COURSE OF ACTION, IN THIS CASE NEGOTIATION UNDER THE PUBLIC EXIGENCY EXCEPTION. THERE WAS NO D&F COVERING THE IRAKLION HOUSES. THEREFORE THERE WAS NO AUTHORITY TO INCLUDE THEM IN THE NEGOTIATION." (FOOTNOTES OMITTED)

THE FULL TEXT OF PARAGRAPH 3-301 (D) OF ASPR, UPON WHICH YOU PLACE MUCH EMPHASIS, READS AS FOLLOWS:

"THE AUTHORITY TO NEGOTIATE GRANTED BY A D&F IS LIMITED TO THE PROCUREMENT WHICH IS REASONABLY AND FAIRLY DESCRIBED IN THE D&F. EACH DEPARTMENT MAY PROVIDE FOR A REASONABLE DEGREE OF FLEXIBILITY, HOWEVER, IN THE APPLICATION OF AN APPROVED D&F TO QUANTITIES AND ESTIMATED COST, IF SUCH FLEXIBILITY IS NOT INCONSISTENT WITH THE NEGOTIATING AUTHORITY INVOLVED. FOR EXAMPLE, IF AT THE TIME A D&F IS SUBMITTED FOR APPROVAL, HISTORICAL EVIDENCE INDICATES THE POSSIBILITY OF INCREASED QUANTITIES, E.G; REQUIREMENTS OF OTHER MILITARY DEPARTMENTS, AND MILITARY ASSISTANCE PROGRAM REQUIREMENTS, AT THE TIME OF NEGOTIATION, THE SUPPORTING DATA AND THE D&F MAY PROVIDE FOR LIMITED ADDITIONAL QUANTITIES. SIMILARLY, A PROVISION MAY BE INCLUDED AUTHORIZING INCREASED QUANTITIES IF NEGOTIATIONS REVEAL THAT ADDITIONAL QUANTITIES CAN BE PROCURED UNDER THE APPROVED PROGRAM AND WITHIN AVAILABLE FUNDS. A SUPERSEDING D&F SHALL BE WITHOUT PREJUDICE TO ANY ACTION TAKEN UNDER THE ORIGINAL D&F."

IT IS CLEAR THAT THE ABOVE PROVISION CONTEMPLATES A "REASONABLE DEGREE OF FLEXIBILITY," BUT ONLY WITH SPECIFIC REFERENCE TO THE QUANTITIES AND ESTIMATED COST OF THE ITEM TO BE PROCURED. THERE IS NOTHING TO INDICATE THAT THE AUTHORITY GRANTED BY A D&F COVERING PREFABRICATED HOUSING AT ONE OVERSEAS LOCATION MAY BE EXPANDED, WITHIN THE CONCEPT OF REASONABLE FLEXIBILITY, TO SUPPORT PROCUREMENT OF SUCH HOUSING AT A DIFFERENT BASE IN ANOTHER COUNTRY. FURTHERMORE, AS TO QUANTITY, THERE IS IN OUR OPINION SUBSTANTIAL MERIT TO YOUR ASSERTION THAT A D&F SPECIFYING THE SCOPE OF THE PROCUREMENT AS 200 UNITS WITH A 50-PERCENT OPTION IS NOT A REASONABLE AND FAIR DESCRIPTION OF A PROCUREMENT OF 380 UNITS WITH NO OPTION QUANTITY. EVEN WITH THE ADDITION OF THE 50-PERCENT OPTION CONTINGENCY TO THE BASIC 200 UNITS, THERE IS A VARIATION OF MORE THAN 25 PERCENT BETWEEN THE D&F QUANTITY AND THE CONTRACT QUANTITY.

THE COMBINATION OF THE QUANTITY VARIATION AND THE ADDITION TO THE RFP OF PERFORMANCE AT A SECOND LOCATION IN A DIFFERENT COUNTRY CONVINCES US OF THE VALIDITY OF YOUR CONTENTION THAT THE D&F OF FEBRUARY 25, 1969, DID NOT "REASONABLY AND FAIRLY DESCRIBE" THE ACTUAL PROCUREMENT WITHIN THE MEANING OF ASPR 3-301 (D). ONLY THE KARAMURSEL PORTION OF THE RESULTANT CONTRACT WAS REASONABLY AND FAIRLY DESCRIBED IN THAT D&F.

WE DISAGREE WITH THE AIR FORCE CONTENTION, AS STATED IN ITS REPORT OF SEPTEMBER 23, 1969, THAT THE D&F, "AS SUPPLEMENTED BY RFP AMENDMENT NO. 2 OF 25 MARCH 1969, AND AS FURTHER SUPPLEMENTED BY THE D&F REFLECTED IN THE MESSAGE OF 23 APRIL 1969, REASONABLY AND FAIRLY DESCRIBED THE ACTUAL PROCUREMENT." (IN SPITE OF THIS LANGUAGE, WE HAVE NOT BEEN MADE AWARE OF THE EXISTENCE OF ANY APPLICABLE D&F OTHER THAN THAT OF FEBRUARY 25.) THE MESSAGE OF APRIL 23, 1969, READS AS FOLLOWS:

"YOUR PROPOSAL FOR CONSTRUCTION OF 200 UNITS OF FAMILY HOUSING AT KARAMURSEL, TURKEY IS NOW BEING EVALUATED. A DETERMINATION HAS BEEN MADE THAT THE GOVERNMENT WILL NOW NEGOTIATE FOR OPTIONAL 180 UNITS. IT HAS ALSO BEEN DETERMINED THAT THESE UNITS WILL BE SHIPPED TO AND ERECTED AT IRAKLION AIR STATION, CRETE.

"IN VIEW OF ABOVE, IF YOUR PROPOSAL IS DETERMINED TO BE ACCEPTABLE FOR NEGOTIATIONS, RECOMMEND YOU BE PREPARED TO NEGOTIATE ON BASIS OF THE OPTIONAL 180 UNITS BEING HANDLED IN SAME MANNER AS THE 200 KARAMURSEL UNITS BUT TO A DIFFERENT LOCATION.

"THIS IS NOT TO BE INTERPRETED AS ACCEPTANCE OF PROPOSAL BUT RATHER AS ADVANCE NOTICE OF GOVERNMENT'S INTENT ON OPTION SO THAT YOU CAN BE PREPARED FOR NEGOTIATIONS IN EVENT YOUR FIRM IS SELECTED."

IT IS CLEAR THAT THE ABOVE MESSAGE DID NOT SET FORTH ANY INDEPENDENT BASIS FOR NEGOTIATING THE PROCUREMENT OF THE IRAKLION HOUSING. THE SAME IS TRUE OF THE SECOND RFP AMENDMENT, WHICH WE NEED NOT QUOTE HERE. YET THE AIR FORCE CONSTRUES THESE TWO DOCUMENTS AS MODIFYING THE D&F TO MAKE IT CONFORM TO THE REQUIREMENTS OF ASPR 3-301 (D). THE AIR FORCE HAS TAKEN THIS POSITION EVEN THOUGH THERE IS NOTHING TO INDICATE THAT, AT THE TIME OF EXECUTION, EITHER DOCUMENT WAS INTENDED TO EXPAND THE SCOPE OF THE D&F.

THE SECOND SENTENCE OF ASPR 3-306 (A) PROVIDES THAT:

"* * * ANY MODIFICATIONS OF SUCH DETERMINATIONS AND FINDINGS SUBSEQUENTLY FOUND TO BE NECESSARY WILL NOT REQUIRE CANCELLATION OF THE REQUEST FOR PROPOSALS OR QUOTATIONS, PROVIDED THE DETERMINATIONS AND FINDINGS AS MODIFIED SUPPORT NEGOTIATION UNDER ANY ONE OF THE AUTHORITIES CITED IN 3- 201 THROUGH 3-217. * * *"

WE CONSIDER THAT WHEN, SUBSEQUENT TO THE EXECUTION OF THE REQUIRED D&F, THERE IS AN EXPANSION OF A PROCUREMENT BEYOND THAT REASONABLY AND FAIRLY DESCRIBED IN THE D&F, THEN THE D&F MUST BE MODIFIED UNDER THE ABOVE-QUOTED PROVISION OF ASPR TO SET OUT A SUFFICIENT BASIS FOR NEGOTIATING THE EXPANDED PROCUREMENT. EVEN IF THE RFP AMENDMENT AND THE MESSAGE OF APRIL 23 WERE INTENDED TO MODIFY THE FEBRUARY 25 D&F, IT IS CLEAR THAT NEITHER THE AMENDMENT NOR THE APRIL 23 MESSAGE SETS FORTH A BASIS FOR NEGOTIATING THE IRAKLION PORTION OF THE PROCUREMENT.

FURTHERMORE, WHILE "PUBLIC EXIGENCY" (10 U.S.C. 2304 (A) (2)) IS THE BASIS OF NEGOTIATION FOR THE WHOLE PROCUREMENT, WE OBSERVE THAT NO PURCHASE REQUEST COVERING THE 180 IRAKLION UNITS WAS EXECUTED UNTIL MAY 6, 1969, BY WHICH TIME PROCUREMENT RESPONSIBILITY HAD LONG SINCE BEEN TRANSFERRED FROM THE WARNER ROBINS AIR MATERIEL AREA (WRAMA) TO THE AIR FORCE SECURITY SERVICE (AFSS). THE MAY 6 PURCHASE REQUEST, EXECUTED BY AN AFSS OFFICIAL, CITED A PRIORITY DESIGNATOR OF 03. YET THE STATEMENT BY THE CONTRACTING OFFICER, INCLUDED AS PART OF THE SEPTEMBER 23 AIR FORCE REPORT, CONTAINS THIS REPRESENTATION: "BOTH PROJECTS, OF COURSE, HAD THE PRIORITY 01 DESIGNATOR ASSIGNED BY WRAMA." THIS IS CLEARLY INCONSISTENT WITH THE RECORD BEFORE OUR OFFICE, AS WRAMA HAD NO PROCUREMENT RESPONSIBILITY TO ASSIGN ANY PRIORITY DESIGNATOR TO THE IRAKLION PROJECT. THE IRAKLION PORTION OF THE PROCUREMENT WAS NOT INTRODUCED BY AFSS UNTIL THE MARCH 25 AMENDMENT TO THE RFP. IN ADDITION, WHATEVER DESIGNATORS WERE REFERENCED ON THE TWO PURCHASE REQUESTS RELATING TO THE KARAMURSEL HOUSING, ONLY THE 03 DESIGNATOR APPEARS ON THE SOLE PURCHASE REQUEST FOR THE IRAKLION PORTION.

THIS FACTUAL MATTER ASIDE, THE MAY 6 PURCHASE REQUEST FOR IRAKLION, CITING A 03 UMMIPS PRIORITY DESIGNATOR, CONSTITUTED NEGOTIATION AUTHORITY UNDER THE CRITERIA OF ASPR 3-202.2 (VI). A MODIFIED D&F, RECITING THIS FACT PURSUANT TO ASPR 3-202.3, COULD HAVE THEN BEEN EXECUTED IN CONSONANCE WITH THE QUOTED PROVISION IN ASPR 3-306 (A) AND THE LAST SENTENCE OF 3-301 (D).

THE CONCLUSION YOU WOULD HAVE US DRAW IS THAT, SINCE THERE WAS NO D&F COVERING THE IRAKLION HOUSING AND SINCE THAT PART OF THE PROCUREMENT WAS NOT REASONABLY AND FAIRLY DESCRIBED IN THE FEBRUARY 25 D&F, THERE WAS NO AUTHORITY TO INCLUDE THEM IN THE NEGOTIATION. THIS REASONING, IN OUR OPINION, FAILS TO OBSERVE THE DISTINCTION BETWEEN THE EXISTENCE OF AUTHORITY TO NEGOTIATE AND THE STATUTORY PREREQUISITE (10 U.S.C. 2310 (B)) TO THE PROPER EXERCISE OF THAT AUTHORITY. IN THIS CONNECTION, WE INVITE YOUR ATTENTION TO OUR DECISION B-164313, JULY 5, 1968, WHEREIN WE STATED:

"IN A LETTER DATED JUNE 24, 1968, YOU ADVANCE AN ADDITIONAL REASON FOR HOLDING THE CONTRACTS ILLEGAL, WHICH IS, ESSENTIALLY, THAT THE ARMY REPRESENTATIVES EXCEEDED THEIR AUTHORITY IN CHANGING THE PURPOSE OF THE PROCUREMENT BY THE TELEGRAPHIC AMENDMENT OF MARCH 29, 1968. THIS ARGUMENT SEEMS TO REST ON TWO PREMISES; FIRST, THAT AUTHORITY TO CONSUMMATE THE CONTRACTS DERIVES FROM THE D & F MADE BY SECRETARY BROOKS ON MARCH 28, 1968, AND SECOND, THAT CONTRACTING AUTHORITY SO DERIVED CAN LEGALLY BE EXERCISED ONLY IN ACCORDANCE WITH THE 'GROUND RULES' SET FORTH IN THE D & F.

"WE WOULD STATE THE FIRST PREMISE SOMEWHAT DIFFERENTLY, THAT IS, IN THIS PARTICULAR CASE THE AUTHORITY GIVEN BY CONGRESS TO NEGOTIATE THE CONTRACTS WAS CONDITIONED UPON A PRIOR SECRETARIAL DETERMINATION AND FINDING THAT IT WOULD BE IN THE INTEREST OF NATIONAL DEFENSE TO HAVE AVAILABLE IN THE EVENT OF A NATIONAL EMERGENCY TWO ADDITIONAL SOURCES OF SUPPLY FOR THE M- 16 RIFLE FAMILY. "WE DO NOT DISAGREE THAT AUTHORITY TO NEGOTIATE THE CONTRACTS DERIVES FROM THE SECRETARIAL D & F. * * *"

IN 10 U.S.C. 2304 (A), THE CONGRESS AUTHORIZED NEGOTIATION OF PURCHASES OR CONTRACTS IN 17 ENUMERATED CIRCUMSTANCES. IT IS CLEAR THAT UNDER THE CRITERIA ESTABLISHED BY THE ASPR IMPLEMENTATION OF SECTION 2304 (A) (2), THERE WAS AUTHORITY TO NEGOTIATE THE PORTION OF THE CONTRACT RELATIVE TO THE IRAKLION HOUSING BECAUSE OF A "PUBLIC EXIGENCY." THAT IS TO SAY, THERE WAS IN EXISTENCE A FACT WHICH, ACCORDING TO RESPONSIBLE ADMINISTRATIVE INTERPRETATION, DEMONSTRATES THAT THE NEEDS OF THE GOVERNMENT WOULD NOT PERMIT THE DELAY INCIDENT TO ADVERTISING.

ON THE OTHER HAND, THE WRITTEN FINDING REQUIRED BY SUBSECTION 2310 (B) TO SUPPORT THE DECISION TO NEGOTIATE THE IRAKLION SEGMENT OF THIS PROCUREMENT WAS NEVER EXECUTED. ACCORDINGLY, THERE HAS BEEN AN ADMINISTRATIVE FAILURE TO COMPLY WITH THIS STATUTORY PROVISION. HOWEVER, THIS DOES NOT BY ITSELF ESTABLISH THAT THERE WAS A LACK OF AUTHORITY UNDER SECTION 2304 (A) (2) TO NEGOTIATE A PROCUREMENT FOR THE IRAKLION HOUSING, AND AS SHOWN ABOVE, THE RECORD IS TO THE CONTRARY, NAMELY, THE CITATION OF AN 03 PRIORITY DESIGNATOR ON THE MAY 6 PURCHASE REQUEST EXECUTED BY AFSS. THEREFORE, WHILE THE AIR FORCE OFFICIALS FAILED TO MODIFY THE D&F IN ACCORDANCE WITH ASPR 3-306 (A), WE DO NOT AGREE THAT THERE WAS NO AUTHORITY TO NEGOTIATE THE PROCUREMENT OF THE IRAKLION HOUSING.

IN ACCORDANCE WITH THE ABOVE VIEWS, AND BECAUSE THE DEMONSTRATED IRREGULARITY IN THE METHOD BY WHICH NEGOTIATION AUTHORITY WAS INVOKED WAS NOT OF A CHARACTER THAT COULD HAVE PREJUDICED THE COMPETITIVE POSITION OF MODULUX, WE MUST AFFIRM OUR DENIAL OF THE PROTEST.