B-149438, MAR. 26, 1953

B-149438: Mar 26, 1953

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ESQUIRE: REFERENCE IS MADE TO YOUR LETTER OF JULY 13. THE SEVERAL CONTENTIONS RAISED IN YOUR LETTERS WILL BE CONSIDERED IN THE ORDER PRESENTED. THE SUBSTANCE OF YOUR INITIAL COMPLAINT IS SET FORTH IN LETTER OF JULY 5. STATING THAT "OUR PROTEST IS BASED ENTIRELY UPON YOUR ERRONEOUS DECISION THAT WESCHE MOTORS ARE EQUAL IN PERFORMANCE AND PHYSICAL CHARACTERISTICS TO THE HERTNER MOTORS SPECIFIED IN THE LIST OF COMPONENTS ON DRAWING 13201E.'. THE ARGUMENTS SET FORTH THEREIN WERE MORE FULLY DETAILED IN A SUBSEQUENT LETTER DATED OCTOBER 2. STATED AS BRIEFLY AS POSSIBLE YOU ARGUE THAT THE CONTRACTING OFFICIALS HAVE DEVIATED FROM THE "GENERAL RULES" LAID DOWN IN PREAWARD CONFERENCES. THAT THE MOTORS OFFERED BY KECO WERE NOT EQUAL TO THOSE SPECIFIED IN THE INVITATION.

B-149438, MAR. 26, 1953

TO E. THEODORE ARNDT, ESQUIRE:

REFERENCE IS MADE TO YOUR LETTER OF JULY 13, 1962, WITH ENCLOSURES, AND SUBSEQUENT CORRESPONDENCE, PROTESTING ON BEHALF OF REDMANSON CORPORATION, AGAINST THE AWARD OF CONTRACT NO. DA-11-184-ENG-19879, TO KECO INDUSTRIES, INC., BY THE ARMY ENGINEER PROCUREMENT OFFICE, CHICAGO, ILLINOIS. THE SEVERAL CONTENTIONS RAISED IN YOUR LETTERS WILL BE CONSIDERED IN THE ORDER PRESENTED.

THE SUBSTANCE OF YOUR INITIAL COMPLAINT IS SET FORTH IN LETTER OF JULY 5, 1962, TO THE CONTRACTING OFFICER, STATING THAT "OUR PROTEST IS BASED ENTIRELY UPON YOUR ERRONEOUS DECISION THAT WESCHE MOTORS ARE EQUAL IN PERFORMANCE AND PHYSICAL CHARACTERISTICS TO THE HERTNER MOTORS SPECIFIED IN THE LIST OF COMPONENTS ON DRAWING 13201E.' THE ARGUMENTS SET FORTH THEREIN WERE MORE FULLY DETAILED IN A SUBSEQUENT LETTER DATED OCTOBER 2, 1962, AND ACCOMPANYING BRIEF. STATED AS BRIEFLY AS POSSIBLE YOU ARGUE THAT THE CONTRACTING OFFICIALS HAVE DEVIATED FROM THE "GENERAL RULES" LAID DOWN IN PREAWARD CONFERENCES; THAT THE MOTORS OFFERED BY KECO WERE NOT EQUAL TO THOSE SPECIFIED IN THE INVITATION; THAT THE MOTORS OFFERED WILL NOT MEET THE SIZE, WEIGHT AND PERFORMANCE REQUIREMENTS; THAT THE MOTORS WERE APPROVED ON INSUFFICIENT EVIDENCE; AND, THAT IF KECO DELIVERS MOTORS WHICH ARE AT VARIANCE WITH THOSE PROPOSED BEFORE AWARD THE CONTRACT SHOULD BE CANCELLED.

IN RESPONSE TO THOSE ALLEGATIONS THE OFFICE OF ASSISTANT SECRETARY, DEPARTMENT OF THE ARMY, UNDER DATE OF NOVEMBER 21, 1962, SUBMITTED TO US A REPORT FROM THE CHIEF, PROCUREMENT DIVISION, WHICH WAS APPROVED BY HEADQUARTERS, ARMY MATERIEL COMMAND, AND WHICH IS IN PERTINENT PART AS FOLLOWS:

"A. ORIGINAL REPORT SUBMITTED BY THIS OFFICE ON SUBJECT PROTEST INCLUDED BASIS FOR DETERMINATION OF "EQUALITY.' NOTHING IN TERMS OF REQUEST FOR PROPOSAL OR PRE-NEGOTIATION DISCUSSIONS IS INCONSISTENT WITH THE ACTION OF GOVERNMENT IN ARRIVING AT THIS DETERMINATION. NOTHING CONTAINED IN THE REQUEST FOR PROPOSAL OR MEETINGS SETTING THE "GROUND RULES" DILUTED THE GOVERNMENT'S RESPONSIBILITY OR RIGHT TO USE ITS ADMINISTRATIVE DISCRETION AND JUDGMENT IN DETERMINATION OF WHAT OFFERED COMPONENTS WERE "EQUAL" TO NAMED COMPONENTS. THIS DETERMINATION WAS MADE UPON REASONABLE AND SUFFICIENT EVIDENCE WITH RESPECT TO THE WESCHE MOTORS.

"B. IT IS AGREED THAT KECO HAS BECOME OBLIGATED BY THE TERMS OF THE CONTRACT TO FURNISH THE WESCHE MOTORS. THE RECORDS OF THIS OFFICE CONTAIN NO INDICATION OR EVIDENCE THAT KECO WILL OFFER IN PERFORMANCE OTHER THAN WESCHE MOTORS THAT CONFORM TO THE CONTRACT SPECIFICATIONS. HOWEVER, THE GOVERNMENT IS NOT BOUND TO REJECT SUPPLIES NOT CONFORMING TO THE CONTRACT. ONCE A CONTRACT IS AWARDED THE GOVERNMENT HAS THE RIGHT TO CHANGE SPECIFICATION REQUIREMENTS OR TO ACCEPT SUPPLIES THAT DEVIATE FROM SUCH REQUIREMENTS WITH ADEQUATE CONSIDERATION IF APPROPRIATE, WHENEVER SUCH ACTION IS CONSIDERED IN THE INTEREST OF THE GOVERNMENT. THE PROTESTOR APPARENTLY IS CONFUSING POST AWARD PROCEDURES AND RIGHTS OF THE GOVERNMENT WITH PRE-AWARD STANDARDS PRESCRIBED FOR EVALUATION OF BIDS.

"C. THIS CONTENTION IS DISCUSSED IN B. ABOVE. THE POST-AWARD RELATIONSHIP BETWEEN THE GOVERNMENT AND THE SUCCESSFUL BIDDER IS NOT CONSIDERED TO BE A VALID BASIS OF PROTEST BY AN UNSUCCESSFUL BIDDER, WHO IS TAKING EXCEPTION TO THE AWARD. HIS PROTEST MUST BE BASED UPON CONSIDERATIONS IN EXISTENCE AT THE TIME OF AWARD BUT GENERALLY SPEAKING NOT UPON PERFORMANCE DEVELOPMENTS AFTER AWARD. IN ANY EVENT KECO HAS NOT YET SUBMITTED PROTOTYPE AIR CONDITIONERS, AND AS STATED IN B. ABOVE, NO EVIDENCE IS AVAILABLE THAT KECO EXPECTS TO DEVIATE FROM SPECIFICATIONS. SHOULD ANY DEVIATION BE REQUESTED, ITS ALLOWANCE WOULD BE WITHIN THE COMPLETE UNILATERAL CONTROL OF THE GOVERNMENT.

"D. AS SET FORTH ABOVE, IT IS NOT CONSIDERED THAT THE PROTESTOR HAS ANY VALID PROTEST INTEREST AT THIS TIME IN THE POST-AWARD RELATIONSHIP OF THE GOVERNMENT AND KECO. THE GOVERNMENT HAS RETAINED ALL OF ITS RIGHTS TO DETERMINE AFTER AWARD AND DURING PERFORMANCE THE ADMINISTRATIVE ACTION WHICH IS IN THE BEST INTEREST OF THE GOVERNMENT. THIS COULD INCLUDE GOVERNMENT OR CONTRACTOR INSTIGATED CHANGES TO THE SPECIFICATIONS.

"E-F. THESE CONTENTIONS AND STATEMENTS HAVE BEEN FULLY DISPOSED OF IN PAR. A. ABOVE. KECO IS CONTRACTUALLY BOUND TO MEET THE OVERALL MAXIMUM WEIGHT LIMITATION OF THE AIR CONDITIONER. THE MOTORS REQUIRED WERE TECHNICALLY DETERMINED BY THE GOVERNMENT NOT TO BE OF UNUSUAL DESIGN AND WESCHE IS CONSIDERED TO BE A HIGHLY CAPABLE EFFICIENT DESIGNER AND PRODUCER OF THESE TYPES OF MOTORS. IT WAS DETERMINED ON THESE GROUNDS AND ON THE BASIS OF THE OTHER EVIDENCE CONCERNING CONFIGURATION AND PERFORMANCE, THAT THE OFFERED WESCHE MOTORS APPEARED TO MEET THE REQUIREMENTS STATED FOR THE NAMED MOTORS.

"G. APPROVAL OF WESCHE MOTORS FOR BOTH RECONY AND KECO WAS WITHHELD UNTIL THE SUBMISSION OF ADDITIONAL DATA BY BOTH VENDORS. THE GOVERNMENT FURNISHED APPROVAL TO BOTH VENDORS BUT ONLY AFTER IT WAS COMPLETELY SATISFIED BY THE ORIGINAL AND SUPPLEMENTARY DATA FURNISHED.

"H, I, J. BIDDERS WERE ADVISED THAT THEY COULD, AFTER THEIR ORIGINAL SUBMISSION OF A SUBSTITUTE "OR EQUAL BRAND," NOT SWITCH BEFORE AWARD TO ANOTHER "OR EQUAL.' A BIDDER COULD HOWEVER BEFORE AWARD SUBMIT ADDITIONAL EVIDENCE AS TO THE ACCEPTABILITY OF ITS ALREADY OFFERED SUBSTITUTE OR IT COULD SWITCH TO THE NAMED HERTNER MOTORS. KECO DID NOT SWITCH TO ANOTHER "OR EQUAL" BRAND OF MOTORS BUT MERELY SUBMITTED ADDITIONAL EVIDENCE THAT THE WESCHE MOTORS MET THE REQUIREMENTS. THIS WAS IN CONFORMANCE WITH THE "GROUND RULES.' THE PROTESTOR IS AGAIN CONFUSING PRE-AWARD AND POST-AWARD CONSIDERATIONS. KECO UP TO THE TIME OF AWARD MET ALL THE BIDDING REQUIREMENTS INCLUDED IN OR SET FORTH IN THE "GROUND RULES.' THE PROTESTOR'S POSITION MUST BE BASED ON THE FACTS AND ISSUES THAT EXISTED AT THE TIME OF AWARD. AS TO THESE THE AWARD WAS CONSISTENT WITH THE "GROUND RULES.' AS SET FORTH ABOVE THE PROTESTOR HAS NO VALID PROTESTING POSITION BASED ON THE POST-AWARD RELATIONSHIP OF THE GOVERNMENT AND THE SUCCESSFUL BIDDER.

"K. THIS IS NOT TRUE. THE GOVERNMENT DID NOT INTEND IN THIS PARTICULAR PROCUREMENT TO RESTRICT ITS FLEXIBILITY IN CONTRACTUAL ADMINISTRATIVE APPROACH AFTER AWARD. IT DID NOTHING IN THE REQUEST FOR PROPOSAL OR PRE- AWARD MEETINGS TO LEAD BIDDERS TO BELIEVE THAT THE GOVERNMENT WAS DEVIATING FROM ITS STANDARD APPROACH IN THIS PARTICULAR PROCUREMENT. THERE WAS NO REASON WHY IT SHOULD HAVE DEVIATED.

"L. ASPR 3-804.2 IS INAPPLICABLE HERE. KECO SUBMITTED ITS PROPOSAL AND ADDITIONAL EVIDENCE AS TO ACCEPTABILITY OF WESCHE MOTORS IN ACCORDANCE WITH THE TIME LIMITATIONS PRESCRIBED BY THE GOVERNMENT. (SEE ALSO PAGES 11-13 OF TRANSCRIPT OF TAPE RECORDING OF PRE NEGOTIATION CONFERENCE).

"M. IT IS CONSIDERED THAT THE BID PROVISIONS WERE CLEAR AND UNAMBIGUOUS.

"N. THE GOVERNMENT IS NOT COMMITTED TO ANY COURSE OF ACTION IF KECO FAILS TO MEET ITS CONTRACTUAL OBLIGATIONS. IT WILL EVALUATE THE SITUATION AT THAT TIME AND TAKE WHATEVER ACTION IT CONSIDERS TO BE IN ITS INTEREST. THIS WOULD INCLUDE THE POSSIBILITY OF NOT DEFAULTING KECO, IF DEFAULT ACTION WAS NOT CONSIDERED ADVISABLE. IN ANY EVENT THE PROTESTOR AT THIS TIME HAS NO PROTESTABLE GROUND OR INTEREST AS FAR AS FUTURE GOVERNMENT ADMINISTRATIVE DECISIONS ARE NCERNED.'

IN A SUBSEQUENT LETTER DATED OCTOBER 29, 1962, YOU STATE THAT--- "INFORMATION NOW RECEIVED INDICATES THAT, INDEED, KECO INDUSTRIES IS ABOUT TO SUBMIT A PREPRODUCTION MODEL IN WHICH WESCHE MOTORS HAVE BEEN INSTALLED, COMPLETELY CHANGED FROM THOSE ORIGINALLY SUBMITTED WITH THEIR PROPOSAL AND WHICH ARE PART OF THEIR CONTRACT.' LATER, BY LETTER OF JANUARY 10, 1963, YOU REPEAT THOSE AND SEVERAL OTHER COMPLAINTS MADE IN YOUR LETTER AND BRIEF OF OCTOBER 2, 1962, NAMELY, THE LACK OF INFORMATION SUBMITTED TO QUALIFY THE WESCHE MOTORS AND THE SUBSTITUTION BY KECO OF REDESIGNED MOTORS. A FURTHER CONTENTION IS THAT KECO HAD NOT FURNISHED THE PREPRODUCTION MODEL WITHIN THE TIME PRESCRIBED IN THE CONTRACT AND, THEREFORE IS IN DEFAULT. WITH YOUR LAST LETTER OF MARCH 4, 1963, YOU FURNISHED SUPPORTING EVIDENCE OF YOUR PREVIOUS CHARGE THAT RECONY DIVISION, VINCO CORPORATION, SUBMITTED NO ADDITIONAL DATA TO QUALIFY THE WESCHE MOTORS AS ACCEPTABLE ALTERNATES.

IN RESPONSE TO THOSE CHARGES THE OFFICE OF THE ASSISTANT SECRETARY OF THE ARMY TRANSMITTED TO US A SUPPLEMENTAL REPORT WHICH IS IN PERTINENT PART AS FOLLOWS:

"A. QUOTATIONS AS SUBMITTED BY RECONY DIVISION-VINCO CORPORATION AND KECO INDUSTRIES, INCORPORATED OFFERED WESCHE MOTORS AS "EQUALS" TO THE HERTNER MOTORS CITED UNDER RFP ENG-11-184-/NEG-62-AF-180). BOTH RECONY AND KECO OFFERED THE IDENTICAL WESCHE UNITS. HOWEVER, TECHNICAL DATA OF WESCHE UNITS FURNISHED BY RECONY, WAS CONSIDERED INSUFFICIENT TO PROPERLY EVALUATE AND RECONY WAS REQUESTED TO FURNISH ADDITIONAL TECHNICAL DATA. THE TECHNICAL DATA OF THE WESCHE UNITS AS FURNISHED BY KECO WAS DEEMED BY THE TECHNICAL EVALUATION TEAM, THIS OFFICE, TO BE SUFFICIENTLY ADEQUATE TO WARRANT AND JUSTIFY THE UNITS OFFERED TO BE CONSIDERED "EQUAL" TO UNITS CITED IN THE REQUEST FOR PROPOSAL. INASMUCH AS WESCHE UNITS OFFERED BY RECONY WERE IDENTICAL IN EVERY RESPECT TO THAT OFFERED BY KECO, THE RECONY "EQUAL" WAS AUTOMATICALLY CONSIDERED ACCEPTABLE AND RECONY WAS SO NOTIFIED.

"B. IT IS AGAIN REITERATED THAT THE ACCEPTANCE OF THE WESCHE MOTORS AS BEING AN ACCEPTABLE ,EQUAL" TO THE HERTNER MOTORS WAS NOT BASED SOLELY UPON THE OUTLINE PRINTS 5369 AND 5370. OTHER INFORMATION UPON WHICH THIS ACCEPTANCE WAS BASED INCLUDED STATEMENTS BY THE MANUFACTURERS OF THE MOTORS AND THE AIR CONDITIONERS THAT PERFORMANCE WOULD BE EQUAL TO OR EXCEED THAT OF THE HERTNER MOTORS; A TECHNICAL EVALUATION MADE BY KECO WHICH DISCLOSED THAT THE SMALL DIFFERENCE IN EXTERNAL DIMENSIONS OF THE WESCHE MOTORS WOULD NOT MATERIALLY AFFECT THE PERFORMANCE OF THE AIR CONDITIONERS WITH RESPECT TO AIR FLOW; A FAVORABLE APPRAISAL OF THE TECHNICAL CAPABILITY OF THE WESCHE COMPANY TO DESIGN AND BUILD PRODUCTS OF HIGH QUALITY; THE FACT THAT THE MOTORS REQUIRED IN THIS AIR CONDITIONER WERE NOT A PARTICULARLY DIFFICULT MOTOR TO DESIGN AND CERTAINLY WITHIN THE STATE OF THE ART OF THE ELECTRIC MOTOR INDUSTRY. IN FURTHER SUPPORT OF THE DECISION TO ACCEPT THE WESCHE MOTORS AS BEING "EQUAL," THE FOLLOWING PROVISIONS APPEARING ON PAGE 6 OF THE IFB ARE QUOTED: "EQUAL PERFORMANCE SHALL BE DEFINED AS EQUAL OR IN EXCESS OF THAT OF THE SPECIFIED COMPONENT UNDER ALL CONDITIONS AS INSTALLED IN THE AIR CONDITIONER AND FOR THE PERIOD OF TEST.' ,EQUAL PHYSICAL CHARACTERISTICS SHALL BE DEFINED AS FOLLOWS: THE CONFIGURATION OF THE COMPONENTS, INDIVIDUALLY AND COLLECTIVELY, SHALL NOT CAUSE THE EXTERIOR DIMENSIONS NOR THE PHYSICAL ARRANGEMENT OF THE EVAPORATOR CONDENSOR AND TIME DELAY SECTIONS TO DEVIATE FROM THAT SHOWN ON THE DRAWINGS. FURTHERMORE, EASE OF MAINTENANCE FEATURES SHALL NOT BE LESS THAN THOSE ATTAINABLE WITH THE SPECIFIED COMPONENTS AS INSTALLED IN THE AIR CONDITIONER.' THE ABOVE CITED PROVISIONS CLEARLY INDICATE THAT PERFORMANCE OF THE ACCEPTED EQUAL WAS CONTINGENT UPON ACCEPTABLE PERFORMANCE AS DISCLOSED BY PREPRODUCTION TESTS AND THAT SIZE VARIATIONS OF INDIVIDUAL COMPONENTS WERE PERMISSIBLE SO LONG AS THE OVERALL DIMENSIONS OF THE CONDITIONERS WERE NOT AFFECTED OR THE LOCATION OF EVAPORATOR CONDENSOR OR TIME DELAY FEATURES WERE NOT ALTERED.

"C. THE PROTESTANT ALLEGES THAT THE GOVERNMENT WAS REMISS IN PERMITTING THE CONTRACTOR TO UTILIZE A MOTOR IN THE FINAL PRODUCT OFFERED THAT VARIED DIMENSIONALLY FROM THAT ACCEPTED AS "OR EQUAL" ON THE BASIS THAT THIS VIOLATED THE PROVISIONS OF THE RFP WHICH RESTRICTED OFFERORS TO ONLY ONE ALTERNATE TO THE COMPONENT SPECIFIED. THE PURPOSE AND INTENT OF THIS PROVISION WAS TO PRECLUDE OFFERORS FROM REPEATEDLY OFFERING ALTERNATIVES IF THEIR PROPOSAL WAS REJECTED AS NOT BEING "EQUAL" WHICH, IF PERMITTED, WOULD HAVE MATERIALLY PROLONGED NEGOTIATIONS. IT IS TRUE THAT AT THE TIME THE AWARD WAS MADE, KECO WAS BOUND CONTRACTUALLY TO PROVIDE A MOTOR EXACTLY IN ACCORDANCE WITH THAT INCLUDED IN THEIR OFFER. THIS HOWEVER DOES NOT MEAN THAT THE GOVERNMENT CANNOT, SUBSEQUENT TO AWARD, MAKE WHATEVER CHANGES TO THE CONTRACTUAL PROVISIONS THAT MAY BE CONSIDERED IN THE BEST INTEREST OF THE GOVERNMENT. THE RIGHT OF THE GOVERNMENT TO MAKE SUCH CHANGES, UNILATERALLY OR BILATERALLY IS INHERENT IN THE CHANGES ARTICLE MADE PART OF EVERY GOVERNMENT SUPPLY CONTRACT, AND IS PERMITTED IN ACCORDANCE WITH PROVISIONS OF THE ARMED SERVICES PROCUREMENT REGULATIONS.

"D. THE FACTS PERTAINING TO THE WESCHE MOTORS OFFERED BY KECO AND FINALLY ACCEPTED BY THE GOVERNMENT ARE AS FOLLOWS:

(1) WESCHE MOTOR PART NUMBERS 5369 AND 5370 AS LISTED WERE OUTLINE PRINT NUMBERS FOR CONDENSOR MOTOR AND EVAPORATOR MOTOR.

(2) THE WESCHE ELECTRIC COMPANY HAS ASSIGNED MODEL NO. M-373 AS THE APPLICABLE MODEL NUMBER FOR OUTLINE PRINT NO. 5370. THIS MOTOR WAS TO BE BUILT IN THEIR STANDARD 3510 FRAME, HOWEVER, DUE TO A WEIGHT PROBLEM A LIGHT WEIGHT AND SMALLER FRAME WAS FURNISHED FOR THIS APPLICATION. THIS RESULTED IN A WEIGHT REDUCTION FOR THIS MOTOR FROM 3.8 POUNDS TO 2 POUNDS 4 OUNCES. (3) WESCHE ELECTRIC MOTOR COMPANY HAS ASSIGNED MODEL NO. M-374 AS THE APPLICABLE MODEL NUMBER FOR OUTLINE PRINT NO. 5369. THIS MODEL REDUCED THE DIMENSION FROM THAT SHOWN ON THIS OUTLINE PRINT AND ALSO RESULTED IN THE MOTOR WEIGHING 6 POUNDS 10 OUNCES INSTEAD OF 8 POUNDS.

(4) SINCE KECO WAS CONTRACTUALLY BOUND TO MEET THE OVERALL MAXIMUM WEIGHT LIMITATION OF THE AIR CONDITIONER, THE MOTORS AS DESCRIBED ABOVE WOULD ENABLE THE CONTRACTOR TO FURNISH AN AIR CONDITIONER THAT MET THE STRINGENT WEIGHT REQUIREMENTS.

(5) THE MOTORS, AS DESCRIBED ABOVE, ARE INCORPORATED INTO THE AIR CONDITIONER UNITS AS MANUFACTURED BY KECO. THE AIR CONDITIONER UNITS SUCCESSFULLY PASSED ALL PREPRODUCTION TESTS THEREBY ATTESTING TO THE "EQUAL" PERFORMANCE OF THE WESCHE MOTORS SUPPLIED. IN ACCEPTING THE PREPRODUCTION MODELS THE GOVERNMENT ACCEPTED THE COMPONENT MOTORS AND THE CONTRACTOR IS THEREBY BOUND TO FURNISH THIS EXACT ITEM IN PRODUCTION UNITS.

"E. CONCERNING PROTESTORS ALLEGATION THAT KECO IS DELINQUENT THE FOLLOWING IS OFFERED:

(1) CONTRACT REQUIRED TESTS TO COMMENCE NOT LATER THAN 28 OCTOBER 1962, PREPRODUCTION MODEL EXAMINATION WHICH IS THE START OF TESTS WAS HELD 6 NOVEMBER 1962. GOVERNMENT LOANED AIR CONDITIONER WAS FURNISHED TO THE CONTRACTOR ON 1 OCTOBER 1962. AS A RESULT OF USING AIR CONDITIONERS FROM ANOTHER SOURCE, THE USER DETERMINED THAT CHANGES IN THE DRAIN PAN, REFRIGERANT HOSE AND CABLE LENGTHS AND THE INSTALLATION OF THE REMOTE CONTROL CONNECTOR KIT, WOULD BE REQUIRED. CONTRACTOR WAS DIRECTED TO MAKE THESE CHANGES ON 14 AND 31 DECEMBER 1962 AND 18 JANUARY 1963.

(2) AS PARAGRAPH 2 OF THE GENERAL PROVISIONS ENTITLED "CHANGES" ADVISES THE GOVERNMENT MAY AT ANY TIME MAKE CHANGES AND THAT AN EQUITABLE ADJUSTMENT SHALL BE MADE IN THE CONTRACT PRICE OR DELIVERY SCHEDULE, OR BOTH.

(3) DUE TO THE EXTENT OF THESE CHANGES AND DELAY IN FURNISHING THE GOVERNMENT LOANED GENERATOR, CONTRACT WILL BE MODIFIED TO EXTEND THE DELIVERY SCHEDULE TO INCORPORATE THE TIME REQUIRED TO MAKE THESE CHANGES AND TIME REQUIRED TO OBTAIN AIR CONDITIONER.

"F. IT IS STILL THE CONTENTION OF THIS OFFICE THAT THE GOVERNMENT IS NOT COMMITTED TO ANY COURSE OF ACTION IF CONTRACTOR FAILS TO MEET ITS CONTRACTUAL OBLIGATION. IT WOULD EVALUATE THE SITUATION AT THAT TIME AND TAKE WHATEVER ACTION IT CONSIDERS TO BE IN ITS INTEREST. THIS WOULD INCLUDE THE POSSIBILITY OF NOT DEFAULTING THE CONTRACTOR, IF DEFAULT ACTION WAS NOT CONSIDERED ADVISABLE. IN ANY EVENT, THE PROTESTOR HAS NO PROTESTABLE GROUNDS OR INTEREST AS FAR AS GOVERNMENT ADMINISTRATIVE DECISIONS ARE CONCERNED.'

IN TRANSMITTAL LETTER OF FEBRUARY 25, 1963, THE OFFICE OF THE ASSISTANT SECRETARY MADE THE FOLLOWING OBSERVATIONS:

"PARAGRAPH E (1) OF THE ADMINISTRATIVE REPORT REFERS TO DESIGN CHANGES REQUESTED BY THE GOVERNMENT AFTER AWARD OF THE CONTRACT. NECESSITY FOR THESE CHANGES DEVELOPED DURING TROOP USE OF THIS TYPE EQUIPMENT WHICH HAD BEEN PROCURED ON AN EARLIER CONTRACT.

"PARAGRAPH E (3) OF THE ADMINISTRATIVE REPORT REFERS TO A GOVERNMENT LOANED GENERATOR. THIS IS A SPECIAL MILITARY GENERATOR FURNISHING 208- VOLT-400 CYCLE ELECTRIC CURRENT NEEDED TO OPERATE THE AIR CONDITIONER. SUCH CURRENT IS NOT ORDINARILY COMMERCIALLY AVAILABLE AND, IN CASES LIKE THIS, THE CONTRACTING OFFICER AGREES TO FURNISH THE PROPER POWER SOURCE FOR OPERATING THE PREPRODUCTION MODEL.'

THE DRAFTING OF SPECIFICATIONS FOR USE WITH GOVERNMENT PROCUREMENTS AND THE FACTUAL DETERMINATION AS TO WHETHER THE SUPPLIES OR SERVICES OFFERED COMPLY WITH THOSE SPECIFICATIONS ARE PRIMARILY THE RESPONSIBILITY OF THE ADMINISTRATIVE OFFICE CONCERNED. AND WHAT MAY BE ACCEPTABLE AS THE EQUIVALENT OF A SPECIFIED COMPONENT THEREOF IS SOLELY FOR DETERMINATION BY THE PROCUREMENT AUTHORITIES IN THE SAME MANNER AS ANY OTHER FACTUAL MATTER PROPERLY FOR CONSIDERATION BY THEM UNDER THE TERMS OF THE CONTRACT. ARE NOT IN A POSITION TO SUBSTITUTE OUR JUDGMENT FOR THAT OF THE CONTRACTING OFFICER AND THEREFORE WE DO NOT FEEL THAT IT WOULD SERVE ANY USEFUL PURPOSE TO REQUEST A SHOWING AS TO THE BASIC EVIDENCE UPON WHICH THE MOTORS WERE APPROVED, AS YOU HAVE SUGGESTED.

INASMUCH AS THIS WAS A NEGOTIATED PROCUREMENT, RATHER THAN ONE CONDUCTED BY FORMAL ADVERTISING, THERE WAS NO IMPROPRIETY IN DEVELOPING FURTHER DATA AS TO THE ITEMS PROPOSED BY KECO BY DISCUSSIONS AFTER THE OPENING OF PROPOSALS. FURTHERMORE, WE HAVE CONSISTENTLY FROWNED UPON THE USE OF BRAND-NAME SPECIFICATIONS AS A MEANS OF REFUSING TO ACCEPT ARTICLES WHICH APPEAR TO BE REASONABLY ADEQUATE FOR THEIR INTENDED USE, AND WHERE, AS IN THIS CASE, THE ITEMS OFFERED AS EQUAL HAVE NOT IN FACT BEEN PREVIOUSLY PRODUCED, BUT THE ADMINISTRATIVE AGENCY IS SATISFIED THAT ACCEPTABLE ITEMS CAN BE PRODUCED BY THE DESIGNATED SOURCE, AND ACCEPTANCE OF THE PROPOSAL DOES NOT BIND THE GOVERNMENT TO ACCEPTANCE OF THE END ITEM UNLESS ALL PERFORMANCE TESTS AND REQUIREMENTS HAVE BEEN MET, WE WOULD BE INCLINED TO CONSIDER A REJECTION OF SUCH PROPOSAL TO BE ARBITRARY AND IMPROPER.

SINCE WE HAVE FOUND NO EVIDENCE OF BAD FAITH OR ABUSE OF DISCRETION IN THE SUBJECT PROCUREMENT OR IN THE ADMINISTRATION OF THE CONTRACT, THE ACTION TAKEN BY THE DEPARTMENT OF THE ARMY WILL NOT BE DISTURBED.