B-151976, OCT. 15, 1963

B-151976: Oct 15, 1963

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ONLY ONE BID WAS RECEIVED. THE COLLINS BID WAS REJECTED BECAUSE THE EQUIPMENT OFFERED WAS OF CANADIAN MANUFACTURE AND THE OFFER WAS CONTINGENT UPON THE RECEIPT OF A DUTY FREE ENTRY CERTIFICATE WHICH MAY NOT BE ISSUED IN CONNECTION WITH PROCUREMENTS OF SUPPLIES ACQUIRED WITH ARMY CIVIL FUNDS. FIVE PROPOSALS TO PERFORM THE WORK ON SCHEDULE I (NO AWARD WAS MADE ON SCHEDULE II) WERE RECEIVED IN THE FOLLOWING AMOUNTS: R.F. COMMUNICATIONS WAS DECLARED NONRESPONSIVE FOR FAILURE TO QUOTE ON ITEM 6 IN ACCORDANCE WITH PARAGRAPH 13 OF THE SCHEDULE WHICH REQUIRED QUOTATIONS ON EVERY ITEM IN ORDER TO ASSURE EQUIPMENT COMPATIBILITY. RCA WAS DISQUALIFIED BECAUSE THE TRANSMITTING UNIT OFFERED POSSESSED ONLY HALF THE SPECIFIED STABILITY.

B-151976, OCT. 15, 1963

TO COMMUNICATION ASSOCIATES, INC.:

THE PROTEST OF YOUR COMPANY AGAINST AWARD OF A CONTRACT FOR RADIOTELEPHONES AND ACCESSORY EQUIPMENT TO THE WESTREX COMPANY, A DIVISION OF LITTON SYSTEMS, INCORPORATED, BY THE UNITED STATES ARMY ENGINEER DISTRICT OF BALTIMORE, MARYLAND, HAS BEEN FORWARDED FOR RESOLUTION TO THIS OFFICE.

ON SEPTEMBER 20, 1962, IN IMPLEMENTATION OF A NATIONWIDE PROGRAM FOR MODERNIZATION OF THE COMMUNICATIONS NETWORKS BETWEEN U.S. ARMY ENGINEER DISTRICTS AND FLOOD CONTROL DAMS, THE BALTIMORE DISTRICT ISSUED INVITATION FOR BIDS NO. CIVENG-18-020-63-8 TO TWENTY KNOWN DESIGNERS AND MANUFACTURERS OF SINGLE SIDEBAND RADIOTELEPHONE SYSTEMS. THE ITEMS TO BE PURCHASED INCLUDED FIXED STATION, PORTABLE, AND MOBILE RADIOTELEPHONES, CABLES AND ANTENNA COUPLERS, AN EXTRA REMOTE CONTROL UNIT AND HANDSETS. ONLY ONE BID WAS RECEIVED, THAT OF THE COLLINS RADIO COMPANY, BECAUSE THE REQUIREMENTS OF THE INVITATION APPARENTLY DID NOT CONFORM TO THE OFF-THE- SHELF PRODUCTS AVAILABLE FROM INDUSTRY BUT NECESSITATED EXTENSIVE REFINEMENTS TO BE INCORPORATED INTO PRODUCTION LINE MODELS. THE COLLINS BID WAS REJECTED BECAUSE THE EQUIPMENT OFFERED WAS OF CANADIAN MANUFACTURE AND THE OFFER WAS CONTINGENT UPON THE RECEIPT OF A DUTY FREE ENTRY CERTIFICATE WHICH MAY NOT BE ISSUED IN CONNECTION WITH PROCUREMENTS OF SUPPLIES ACQUIRED WITH ARMY CIVIL FUNDS. THE CONTRACTING OFFICER THEREUPON MADE THE NECESSARY DETERMINATION AND FINDING OF AUTHORITY TO NEGOTIATE PURSUANT TO 10 U.S.C. 2304 (A) (10) AND ARMED SERVICES PROCUREMENT REGULATION 3 210.2 (III) AND DISPATCHED A REQUEST FOR PROPOSALS COVERING THE SAME EQUIPMENT TO ELEVEN PROSPECTIVE OFFERORS (MOST OF WHOM HAD PREVIOUSLY RECEIVED INVITATIONS) ANNOUNCING THAT THE GOVERNMENT WOULD BE OPEN TO OFFERS UNTIL THE CLOSE OF BUSINESS ON JANUARY 4, 1963.

FIVE PROPOSALS TO PERFORM THE WORK ON SCHEDULE I (NO AWARD WAS MADE ON SCHEDULE II) WERE RECEIVED IN THE FOLLOWING AMOUNTS: R.F. COMMUNICATIONS, INC., OF ROCHESTER, NEW YORK, $44,365; RADIO CORPORATION OF AMERICA OF CHERRY HILL, NEW JERSEY, $82,121; COLLINS RADIO COMPANY OF CEDAR RAPIDS, IOWA, $88,994 (INITIALLY EVALUATED AS $99,674 BECAUSE OF ADJUSTMENTS MADE NECESSARY BY EXECUTIVE ORDER AND REGULATION); COMMUNICATIONS ASSOCIATES, INC., OF NEW HYDE PARK, LONG ISLAND, NEW YORK (HEREAFTER TO BE REFERRED TO AS "C.A.I.'' $95,125; WESTREX COMPANY, A DIVISION OF LITTON SYSTEMS, INC., OF NEW YORK, NEW YORK, (HEREAFTER REFERRED TO AS "WESTREX") $101,132.60. THE OFFER OF R.F. COMMUNICATIONS WAS DECLARED NONRESPONSIVE FOR FAILURE TO QUOTE ON ITEM 6 IN ACCORDANCE WITH PARAGRAPH 13 OF THE SCHEDULE WHICH REQUIRED QUOTATIONS ON EVERY ITEM IN ORDER TO ASSURE EQUIPMENT COMPATIBILITY. RCA WAS DISQUALIFIED BECAUSE THE TRANSMITTING UNIT OFFERED POSSESSED ONLY HALF THE SPECIFIED STABILITY, AND THE MOBILE EQUIPMENT WHICH WAS REQUIRED TO BE SUITABLE FOR INSTALLATION IN AN AUTOMOBILE TRUNK WAS DESIGNED TO BE INSTALLED UNDER THE DASHBOARD INSTEAD.

AFTER THE INITIAL PROPOSALS HAD BEEN REVIEWED BY THE CONTRACTING OFFICER'S NEGOTIATION TEAM, MR. DONALD J. S. MERTEN, THE PRESIDENT OF C.A.I., TELEPHONED THE DISTRICT, ALLEGEDLY TO ASCERTAIN WHETHER THE COMPANY'S PROPOSAL, SENT BY REGISTERED MAIL DURING THE CHRISTMAS RUSH, HAD ARRIVED ON TIME SINCE HE HAD NOT YET RECEIVED THE RETURN OF A CERTIFIED POSTAL RECEIPT. ACCORDING TO MR. MERTEN, MR. FRANK A. GUIGIO, THE CHIEF, CONTRACT ADMINISTRATION BRANCH, INFORMED HIM THAT THE OFFER HAD ARRIVED ON TIME, THAT HE HAD RECEIVED FIVE "BIDS," AND THAT HE WOULD READ MERTEN THE RESULTS IF HE WANTED TO TAKE THEM DOWN. THEN, MR. MERTEN ALLEGES, GUIGIO READ THE NAMES AND ADDRESSES OF ALL OFFERORS AND THE PRICES QUOTED BY ALL ON EACH ITEM. COMPARE THE LAST SENTENCE OF ASPR 3-804.1.

MR. GUIGIO DOES NOT RECALL THE TELEPHONE CALL, ADMITS IT MIGHT HAVE HAPPENED, AND STATES THAT THE PREPONDERANCE OF THE DISTRICT'S PROCUREMENTS ARE MADE THROUGH THE SYSTEM OF FORMAL ADVERTISING, THAT LESS THAN ONE PERCENT ARE NEGOTIATED, THAT DURING THE WEEK IN QUESTION THERE HAD BEEN FOURTEEN BID OPENINGS WITH INNUMERABLE TELEPHONE INQUIRIES FROM BIDDERS, AND THAT HIS STAFF IS NOT ACCUSTOMED TO THE SPECIAL PRECAUTIONS APPLICABLE TO A NEGOTIATED TRANSACTION. AFTER THE PROPOSALS WERE OPENED ON JANUARY 4, 1963, THEY WERE AT FIRST FILED IN THE SAME MANNER AS BIDS AND WERE FREELY ACCESSIBLE TO ALL DISTRICT PERSONNEL AND, ACCORDING TO GUIGIO, IF SUCH A TELEPHONE CALL HAD BEEN RECEIVED IT WOULD PROBABLY HAVE BEEN ANSWERED FULLY AS A MATTER OF ROUTINE. DISTRICT PERSONNEL STATE THAT THIS "PROCEDURAL DEFICIENCY" WAS SOON NOTICED AND REMEDIED BY LIMITING ACCESS TO INFORMATION ON THIS PROCUREMENT TO MEMBERS OF THE NEGOTIATING TEAM. WRITTEN PROTEST WAS NOT RECEIVED FROM C.A.I. UNTIL AFTER THE CONSUMMATION OF THE AWARD.

NEGOTIATIONS WERE UNDERTAKEN WITH THE THREE RESPONSIVE OFFERORS SUBMITTING PROPOSALS WITHIN A COMPETITIVE RANGE. SEE ARMED SERVICES PROCUREMENT REGULATION 3-805.1. A PRE-NEGOTIATION MEETING OF ALL PROSPECTIVE CONTRACTORS WAS HELD TO REVIEW THE TECHNICAL PROBLEMS INVOLVED IN THE AWARD ON FEBRUARY 5, 1963, BUT NO DATE WAS SET BY WHICH REVISED PROPOSALS WOULD BE DUE AT THIS POINT IN THE NEGOTIATIONS. COMPARE ARMED SERVICES PROCUREMENT REGULATION 3-805.1 (B). EACH OF THE THREE OFFERORS WAS THEN INVITED TO APPEAR INDIVIDUALLY AT THE DISTRICT TO DISCUSS ITS RESPECTIVE PROPOSAL.

THE ADMINISTRATIVE REPORT STATES THAT ON FEBRUARY 18, 1963:

"WESTREX REPRESENTATIVES WERE ADVISED THAT THEIR PROPOSAL WAS NOT THE LOWEST RECEIVED, AND WERE ASKED WHETHER THEY FELT THERE WAS ANY ROOM FOR REDUCTION. AFTER CONFERRING PRIVATELY, THEY QUOTED NEW UNIT PRICES TOTALING $92,647. WESTREX THEREBY DISPLACED C.A.I. AS LOW OFFEROR. LETTER, 21 FEBRUARY 1963, THIS FIGURE WAS FURTHER REDUCED TO $89,186.'

A MEETING WAS HELD WITH C.A.I. ON FEBRUARY 19, 1963, AS TO WHICH THE REPORT COMMENTS:

"ADVISED THAT C.A.I. WAS NOT THE LOW OFFEROR,"MR. MERTEN)" * * * SUBMITTED A REDUCED PROPOSAL" (IN THE AMOUNT OF $92,725.)

CONCERNING THE PREPARATIONS MADE FOR THIS MEETING, C.A.I., STATES:

"THE WRITER, HAVING HAD PREVIOUS EXPERIENCE IN NEGOTIATED PROCUREMENTS, WITH THE HELP OF OUR ACCOUNTANT, PREPARED COMPLETE BILLS OF MATERIALS, PROCURED COPIES OF PAID INVOICES FOR ALL MAJOR ITEMS, WORKED OUT DETAILED GRAPHS OF HOURS OF PRODUCTION, ENGINEERING, TEST, DETAILED BREAKDOWN OF PRICES BID IN REGARD TO FACTORY OVERHEAD, ENGINEERING OVERHEAD, GENERAL AND ADMINISTRATIVE EXPENSES, AND PROFIT. THE WRITER CAME PREPARED TO NEGOTIATE IN REGARD TO ANY TECHNICAL ASPECTS AS WELL.'

OF THE MEETING C.A.I. COMMENTS:

"CONSIDERABLE TIME WAS SPENT IN GOING OVER THE ITEMS IN A VERY NON TECHNICAL WAY * * *.

(THE DISTRICT WAS TRYING TO ASSURE ITSELF THAT C.A.I.'S OFFER WAS RESPONSIVE).

"NO DISCUSSION WAS HELD IN REGARD TO MATERIAL COST, OVERHEAD, GENERAL AND ADMINISTRATIVE EXPENSE AND/OR PROFITS. NO DISCUSSION OF HOURS OF LABOR, LABOR RATES, TOOLS, FIXTURES OR ETC.

"PRICE DISCUSSION DID OCCUR BUT ONLY ON UNIT PRICES OF THE EQUIPMENT. BECAME IMMEDIATELY APPARENT THAT THE MAIN PURPOSE OF THIS NEGOTIATION WAS FOR THE REDUCTION OF THE PRICE QUOTED. SAID REQUESTS FOR REDUCTION WERE NOT BASED ON FACTS OF COST OF MATERIAL OR LABOR, OVERHEAD, PROFITS AND ETC., * * *.

"STATEMENTS SUCH AS "REMEMBER, YOU ARE NOT LOW BIDDER" AND "YOUR COMPETITOR HAS COME DOWN IN PRICE, WHY CAN-T YOU? " WERE USED MANY TIMES.'

COLLINS RADIO COMPANY REFUSED TO COME TO THE DISTRICT FOR A NEGOTIATION CONFERENCE BUT SUBMITTED A REVISED QUOTATION ON MARCH 5, 1963, IN THE AMOUNT OF $80,562 AND THUS BECAME LOW OFFEROR (SINCE THE COLLINS BID WAS PREDICATED UPON SUPPLYING A NON-DOMESTIC ITEM A 6 PERCENT DIFFERENTIAL WAS ADDED TO THIS PRICE ACROSS THE BOARD AND ANOTHER 6 PERCENT WAS ADDED DURING THE INTERVALS WHEN C.A.I., APPARENTLY A SMALL BUSINESS CONCERN LOCATED IN A DISTRESSED LABOR AREA, WAS LOW.)

C.A.I. TELETYPED AN UNSOLICITED REVISED PROPOSAL ON MARCH 8, 1963, IN THE AMOUNT OF $88,075, AND AGAIN, BRIEFLY, BECAME LOW OFFEROR. BY LETTER OF THE SAME DATE, C.A.I. FURTHER REDUCED ITS PRICE TO $87,725. WESTREX SUBMITTED AN UNSOLICITED REVISED PROPOSAL DATED MARCH 12, 1963, IN THE AMOUNT OF $76,828 AND RECOVERED THE LEAD IN THE PRICE COMPETITION.

HEARING NOTHING FURTHER ON THE PROCUREMENT AND EAGER TO KNOW ABOUT THE PROGRESS OF THE NEGOTIATIONS, MR. MERTEN TELEPHONED THE DISTRICT ON MARCH 14, 1963, AND WAS TOLD BY THE "TECHNICAL ENGINEER" THAT NEGOTIATIONS WERE BEING CONDUCTED WITH WESTREX. MR. MERTEN THEN SPOKE TO MR. GUIGIO, CHARGED THAT INFORMATION CONCERNING THE VARIOUS PROPOSALS HAD BEEN IMPROPERLY DISCLOSED TO UNAUTHORIZED PERSONS INCLUDING HIMSELF, AND ADVISED HIM OF C.A.I.'S OFFICIAL PROTEST AGAINST "ANY AWARD * * * TO ANYONE OTHER THAN R.C.A. OR C.A.I.' LATER IN THE DAY THE DISTRICT'S LEGAL ADVISER TELEPHONED MR. MERTEN, DISCUSSED HIS CHARGES OF IMPROPRIETY AND INFORMED HIM THAT AN AMENDMENT TO THE REQUEST FOR PROPOSALS WAS ABOUT TO BE ISSUED WHICH WOULD FURTHER CLARIFY THE SPECIFICATIONS. MR. MERTEN, PRESUMABLY BELIEVING THAT THE WESTREX OFFER HAD BEEN TECHNICALLY NONRESPONSIVE FROM THE BEGINNING AND THAT THE AMENDMENT WOULD FINALLY ELIMINATEWESTREX FROM COMPETITION, WAS TEMPORARILY PACIFIED AND DELAYED THE MAILING OF A FORMAL LETTER OF PROTEST WHICH HE HAD PREPARED PENDING FURTHER DEVELOPMENTS IN THE PROCUREMENT.

FOR THE FIRST TIME SINCE THE INCEPTION OF NEGOTIATIONS A CUT-OFF DATE BY WHICH REVISED PROPOSALS WERE TO BE RECEIVED AT THE DISTRICT WAS SET (APRIL 1, 1963) IN AMENDMENT NO. 1 WHICH WAS ISSUED ON MARCH 25, 1963. RECEIPT OF THE AMENDMENT WAS ACKNOWLEDGED BY ALL THREE COMPETITORS AND A NEW REVISED PROPOSAL DATED APRIL 1, 1963, IN THE AMOUNT OF $85,805 WAS RECEIVED FROM C.A.I. ON APRIL 10, 1963, FIXED PRICE CONTRACT DA-18-020- CIVENG-63-207 IN THE AMOUNT OF $76,828 WAS AWARDED TO THE WESTREX COMPANY. C.A.I.'S FORMAL WRITTEN PROTEST WAS RECEIVED BY THE DISTRICT ON APRIL 11, 1963.

BY YOUR PROTEST, YOU RAISE THE FOLLOWING OBJECTIONS TO THE CONDUCT OF THE DISTRICT IN THIS ASE:

(1) YOU CONTEND THAT THE DISTRICT ERRED IN NEGOTIATING RATHER THAN READVERTISING THE PURCHASE BECAUSE OF THE RELATIVELY COMMONPLACE NATURE OF THE ITEM AND BECAUSE SEVERAL SIMILAR RECENT PURCHASES BY ENGINEER DISTRICTS HAVE BEEN ACCOMPLISHED BY FORMAL ADVERTISING;

(2) YOU CONDEMN THE UNAUTHORIZED DISCLOSURE OF THE IDENTITY OF OFFERORS AND OF THE TERMS OF THEIR PROPOSALS AND THE MANNER IN WHICH NEGOTIATIONS WERE CONDUCTED BY GOVERNMENT PERSONNEL AS CONSTITUTING AN "AUCTION TECHNIQUE" IN CONTRAVENTION OF ARMED SERVICES PROCUREMENT REGULATION 3- 805.1 (B);

(3) YOU MAINTAIN THAT THE INITIAL WESTREX PROPOSAL WAS NOT IN A COMPETITIVE RANGE WITH THE LOWER PRICED PROPOSALS, THAT WESTREX WAS AND IS TECHNICALLY NONRESPONSIVE TO THE REQUEST FOR PROPOSALS, AND THAT HENCE NEGOTIATIONS SHOULD NOT HAVE BEEN BEGUN WITH WESTREX NOR SHOULD ITS PROPOSAL HAVE BEEN ACCEPTED (YOU POINT OUT THAT WESTREX HAS ALREADY FAILED TO MEET THE DELIVERY SCHEDULE OF THE CONTRACT AND THUS HAS DEFAULTED ON ITS OBLIGATIONS TO THE GOVERNMENT, AN EVENTUALITY WHICH YOU SAY SUPPORTS YOUR CONTENTION THAT THE CHOICE OF WESTREX AS CONTRACTOR ON THE CRITERION OF PRICE ALONE WAS IMPROVIDENT); AND

(4) LASTLY YOU RESENT THE CAVALIER MANNER IN WHICH THE DISTRICT, BEING AWARE OF YOUR PROTEST, NONETHELESS LET THE CONTRACT TO WESTREX WITHOUT FIRST SUBMITTING THE MATTER TO THIS OFFICE FOR DECISION.

IN GENERAL A DETERMINATION AND FINDING OF AUTHORITY TO NEGOTIATE A CONTRACT OR CLASS OF CONTRACTS WHICH IS PROPERLY EXECUTED BY AN ADMINISTRATIVE OFFICIAL WHO IS AUTHORIZED TO MAKE SUCH A DETERMINATION IS BINDING AND CONCLUSIVE UPON THE GENERAL ACCOUNTING OFFICE AS TO THE LEGALITY OF THE MODE OF PROCUREMENT. B-147384 DATED DECEMBER 1, 1961; B- 151043 DATED JUNE 21, 1963. SEE ARMED SERVICES PROCUREMENT REGULATION 3- 303.

THE MOST SIGNIFICANT ISSUE RAISED BY YOUR PROTEST IS YOUR ALLEGATION THAT THE CONDUCT OF DISTRICT PERSONNEL WITH RESPECT TO THIS PROCUREMENT CONSTITUTED USE OF THE "AUCTION TECHNIQUE" WHICH IS STRICTLY FORBIDDEN BY REGULATION. NEGOTIATED PROCUREMENT HAS BEEN DEFINED AS ANY METHOD OF MAKING PURCHASES AND CONTRACTS WHICH DOES NOT INVOLVE FORMAL ADVERTISING. SEE ARMED SERVICES PROCUREMENT REGULATION 1-201.11; FEDERAL PROCUREMENT REGULATIONS 1-1.218. IT IS AN EXCEPTIONAL AND FLEXIBLE MODE OF PROCUREMENT INTENDED BY CONGRESS FOR USE, INTER ALIA, WHEN COMPETITION IS INADEQUATE TO ASSURE A SATISFACTORY PRICE, WHEN CIRCUMSTANCES DO NOT PERMIT OF THE DELAYS INCIDENT TO FORMAL ADVERTISING, WHEN FACTORS OTHER THAN PRICE ARE OF PARAMOUNT IMPORTANCE TO THE GOVERNMENT, AND WHEN PUBLIC POLICY OR CONVENIENCE WOULD BE BETTER SERVED BY RESORT TO A LESS FORMAL AND RIGOROUS PROCEDURE. SEE 10 U.S.C. 2304 (A).

THE PROHIBITION AGAINST THE USE OF AN "AUCTION TECHNIQUE" IS ONE OF THE LIMITATIONS WHICH HAVE BEEN PLACED BY REGULATION ON NEGOTIATION PROCEDURES. THE LIMITATION IS SUMMED UP IN ARMED SERVICES PROCUREMENT REGULATION 3-805.1 (B) AS FOLLOWS: "WHENEVER NEGOTIATIONS ARE CONDUCTED WITH MORE THAN ONE OFFEROR, NO INDICATION SHALL BE MADE TO ANY OFFEROR OF A PRICE WHICH MUST BE MET TO OBTAIN FURTHER CONSIDERATION SINCE SUCH PRACTICE CONSTITUTES AN AUCTION TECHNIQUE WHICH MUST BE AVOIDED. AFTER RECEIPT OF PROPOSALS, NO INFORMATION REGARDING THE NUMBER OR IDENTITY OF THE OFFERORS PARTICIPATING IN THE NEGOTIATIONS SHALL BE MADE AVAILABLE TO THE PUBLIC OR TO ANY ONE WHOSE OFFICIAL DUTIES DO NOT REQUIRE SUCH KNOWLEDGE. WHENEVER NEGOTIATIONS ARE CONDUCTED WITH SEVERAL OFFERORS, WHILE SUCH NEGOTIATIONS MAY BE CONDUCTED SUCCESSIVELY, ALL OFFERORS SELECTED TO PARTICIPATE * * * SHALL BE OFFERED AN EQUITABLE OPPORTUNITY TO SUBMIT SUCH PRICE, TECHNICAL, OR OTHER REVISIONS IN THEIR PROPOSALS AS MAY RESULT FROM THE NEGOTIATIONS. ALL SUCH OFFERORS SHALL BE INFORMED OF THE SPECIFIED DATE (AND TIME IF DESIRED) OF THE CLOSING OF NEGOTIATIONS AND THAT ANY REVISIONS TO THEIR PROPOSALS MUST BE SUBMITTED BY THAT DATE.'

BY THE ABOVE QUOTED LANGUAGE, IF THE TELEPHONE CALL ALLEGED TO HAVE TAKEN PLACE BY MR. MERTEN BETWEEN HIMSELF AND A REPRESENTATIVE OF THE DISTRICT, DID TAKE PLACE, AND WE THINK THERE IS REASON FOR BELIEVING THAT IT DID OCCUR, THE REVELATION OF THE IDENTITY OF THE OFFERORS AND THE PRICES QUOTED WAS HIGHLY IMPROPER.

THE QUESTION WHETHER THE CONTRACTING OFFICER'S NEGOTIATION TEAM MAY REVEAL TO A COMPETITOR WHETHER HIS PRICE IS PRESENTLY THE LOWEST OFFERED IS MORE DIFFICULT TO ANSWER. THE REGULATION, AS IT IS NOW WORDED, DOES NOT EXPRESSLY FORBID SUCH DISCLOSURES. IT APPEARS THAT A DIVERGENCE OF OPINION ON THIS ISSUE EXISTS EVEN AMONG THE PROCURING DEPARTMENTS OF THE DEFENSE ESTABLISHMENT ALTHOUGH THE CHAIRMAN OF THE ARMED SERVICES PROCUREMENT REGULATION COMMITTEE OF THE DEPARTMENT OF DEFENSE HAS HELD "THAT IT WOULD BE UNLAWFUL TO DISCLOSE THE FACT THAT A BIDDER WAS NOT LOW OR TO OTHERWISE INDICATE TO HIM INFORMATION WITH RESPECT TO PRICES.' HOUSE OF REPRESENTATIVES, COMMITTEE ON ARMED SERVICES, SUBCOMMITTEE FOR SPECIAL INVESTIGATIONS, 85TH CONGRESS, FIRST SESSION, REPORT ON STUDY OF ARMED SERVICES PROCUREMENT ACT, SUBCOMMITTEE PROCEEDINGS NO. 3 PAGE 684. WE INCLINE TOWARD THE VIEW THAT, ABSENT A MORE SPECIFIC EXPRESSION TO THE CONTRARY IN STATUTE OR REGULATION, AN OFFEROR OUGHT NOT TO BE INFORMED WHETHER OR NOT HIS PROPOSAL IS THE LOWEST IN PRICE AS OF THE TIME OF HIS INQUIRY. HENCE, ANY STATEMENTS OF THE CHARACTER REFERRED TO BEFORE WHICH ARE ALLEGED TO HAVE BEEN MADE BY GOVERNMENT REPRESENTATIVES DURING NEGOTIATIONS, WERE IMPROPER. B-147874 DATED APRIL 16, 1962. COMPARE 38 COMP. GEN. 754 AND 37 COMP. GEN. 855.

WE REGARD THE DISCRETION TO DETERMINE WHICH OFFERORS ARE WITHIN A COMPETITIVE RANGE, PRICE AND OTHER FACTORS CONSIDERED, WITHIN THE MEANING OF ARMED SERVICES PROCUREMENT REGULATION 3-805.1, TO BE SOLELY WITHIN THE PURVIEW OF THE CONTRACTING OFFICER UNLESS ABUSE OF SUCH AUTHORITY CAN BE SHOWN BY CLEAR AND CONVINCING EVIDENCE. B-146415 DATED AUGUST 21, 1961. THE RECORD IN THIS CASE IS DEVOID OF SUCH EVIDENCE. SIMILARLY, SINCE WESTREX HAS AGREED TO COMPLY WITH THE SPECIFICATIONS, AND SINCE YOU HAVE ADDUCED NO EVIDENCE DEMONSTRATING THAT THE CONTRACTING OFFICER ERRED IN FINDING THE WESTREX PROPOSAL ACCEPTABLE, WE ARE NOT PERSUADED BY YOUR CONTENTION THAT THE WESTREX PROPOSAL WAS TECHNICALLY INADEQUATE AND NONRESPONSIVE. THE FACT THAT WESTREX MAY NOW BE IN DEFAULT UPON ITS OBLIGATIONS UNDER THE CONTRACT IS NOT CONTROLLING SINCE "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.' 149438 DATED MARCH 26, 1963.

WITH REFERENCE TO YOUR LAST CONTENTION, THE CONTRACTING OFFICER HAD RECEIVED NO FORMAL WRITTEN NOTICE OF PROTEST AT THE TIME HE MADE THE AWARD. HENCE THE LETTING OF THE CONTRACT WAS NOT CONTRARY TO APPLICABLE REGULATIONS. ARMY PROCUREMENT PROCEDURES 2-407.9 (G). WE SUGGEST THAT YOU REDUCE TO WRITING ANY FUTURE PROTEST YOU MAY HAVE AND DISPATCH IT EITHER TO THIS OFFICE OR TO THE CONTRACTING OFFICER AT THE TIME YOU ARE AGGRIEVED AND WITHOUT DELAYING UNTIL AN AWARD HAS BEEN CONSUMMATED.

WE THINK THAT THE IRREGULARITIES WHICH OCCURRED DURING THE NEGOTIATIONS OF THIS CONTRACT RESULTED FROM THE INEXPERIENCE OF THE GOVERNMENT PERSONNEL INVOLVED AND ARE NOT OF SUCH MOMENT IN THIS INSTANCE AS TO WARRANT THE CANCELLATION OF THE AWARD.