B-152896, FEB. 13, 1964

B-152896: Feb 13, 1964

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THE DESIGN AND CONSTRUCTION PHASE IS BEING PERFORMED BY THE BOARD OF TRUSTEES OF STANFORD UNIVERSITY UNDER A COST-TYPE PRIME CONTRACT (NO. HOLD A COST-PLUS FIXED-FEE SUBCONTRACT UNDER THE ABOVE PRIME CONTRACT AND ARE PERFORMING CERTAIN OF THE ARCHITECTURAL. BIDS WERE OPENED ON SEPTEMBER 6. THE LOW BID OF THE SIX RECEIVED WAS SUBMITTED BY COLUMBIA ELECTRIC MANUFACTURING COMPANY (COLUMBIA) AT A PRICE OF $309. THESE REQUIREMENTS ARE CONTAINED IN PARAGRAPH 2 OF THE TECHNICAL SPECIFICATIONS AND PARAGRAPH 6 (A) (2) OF BIDDER'S QUALIFICATIONS IN INSTRUCTIONS TO BIDDERS AND READ. THE BIDDER SHALL HAVE DESIGNED AND BUILT AT LEAST 100 INTEGRATED UNIT SUBSTATIONS. THE AEC REPORTS THAT COLUMBIA WAS FOUND TO BE NON-RESPONSIVE TO PARAGRAPH 2 OF THE TECHNICAL SPECIFICATIONS BECAUSE IT WAS NOT PROPOSING TO MANUFACTURE TRANSFORMERS OR DRAW-OUT TYPE CIRCUIT BREAKERS.

B-152896, FEB. 13, 1964

TO RUFFO AND ONE TO:

WE REFER TO YOUR LETTER OF NOVEMBER 12, 1963, AND ENCLOSURES, PROTESTING ON BEHALF OF YOUR CLIENT, COLUMBIA ELECTRIC MANUFACTURING COMPANY, AGAINST THE AWARD OF A CONTRACT UNDER INVITATION FOR BIDS NO. ABA-613-X-1 ISSUED BY AETRON-BLUME-ATKINSON, A JOINT VENTURE UNDER A COST-TYPE CONTRACT FOR THE ENGINEERING, DESIGN AND CONSTRUCTION OF THE FACILITIES FOR THE STANFORD LINEAR ACCELERATOR CENTER.

THE STANFORD LINEAR ACCELERATOR PROJECT INVOLVES THE DESIGN, CONSTRUCTION AND OPERATION OF A NATIONAL HIGH ENERGY FACILITY UTILIZING A HIGH ENERGY ELECTRON ACCELERATOR AS ITS PRINCIPAL TOOL. THE DESIGN AND CONSTRUCTION PHASE IS BEING PERFORMED BY THE BOARD OF TRUSTEES OF STANFORD UNIVERSITY UNDER A COST-TYPE PRIME CONTRACT (NO. AT/04-3/-400) WITH THE ATOMIC ENERGY COMMISSION (AEC). AEROJET-GENERAL CORPORATION, JOHN A. BLUME AND ASSOCIATES AND GUY F. ATKINSON COMPANY, JOINT VENTURERS (UNDER THE NAME OF AETRON-BLUME-ATKINSON), HOLD A COST-PLUS FIXED-FEE SUBCONTRACT UNDER THE ABOVE PRIME CONTRACT AND ARE PERFORMING CERTAIN OF THE ARCHITECTURAL, ENGINEERING, CONSTRUCTION, AND OTHER RELATED WORK ON THE PROJECT.

ON AUGUST 2, 1963, AETRON-BLUME-ATKINSON ISSUED INVITATION FOR BIDS NO. ABA-613-X-1 FOR THE PROCUREMENT OF 22 UNIT SUBSTATIONS FOR THE PROJECT. BIDS WERE OPENED ON SEPTEMBER 6, 1963. THE LOW BID OF THE SIX RECEIVED WAS SUBMITTED BY COLUMBIA ELECTRIC MANUFACTURING COMPANY (COLUMBIA) AT A PRICE OF $309,490. THE NEXT LOW BID OF $342,470WAS SUBMITTED BY FEDERAL PACIFIC ELECTRIC COMPANY. THE REMAINING FOUR BIDS RANGED FROM $347,753 TO $490,470.

THE CONTRACT BETWEEN THE AEC AND STANFORD UNIVERSITY CONTAINED A PROVISION REQUIRING APPROVALS BY THE AEC OF SUBCONTRACTS AND PURCHASE ORDERS. SEE 10 CFR 5.404. IN ADDITION, THE CONTRACT BETWEEN STANFORD UNIVERSITY AND AETRON-BLUME-ATKINSON CONTAINED A PROVISION THAT ALL SUB SUB-CONTRACTS WOULD BE SUBMITTED TO THE UNIVERSITY FOR APPROVAL.

ON SEPTEMBER 24, 1963, AFTER REVIEW OF COLUMBIA'S BID, AETRON-BLUME ATKINSON ADVISED COLUMBIA INFORMALLY BY TELEPHONE THAT IT DID NOT BELIEVE THE CONTRACT SHOULD BE AWARDED TO COLUMBIA BECAUSE IT DID NOT MEET CERTAIN REQUIREMENTS SET FORTH IN THE INVITATION FOR BIDS. SPECIFICALLY, THESE REQUIREMENTS ARE CONTAINED IN PARAGRAPH 2 OF THE TECHNICAL SPECIFICATIONS AND PARAGRAPH 6 (A) (2) OF BIDDER'S QUALIFICATIONS IN INSTRUCTIONS TO BIDDERS AND READ, RESPECTIVELY AS FOLLOWS:

"* * * ALL TRANSFORMERS AND DRAW-OUT TYPE CIRCUIT BREAKERS SHALL BE MANUFACTURED BY THE CONTRACTOR, AND ALL SECTIONS OF THE ARTICULATED UNIT SUBSTATIONS SHALL BE COMPLETELY COORDINATED, ASSEMBLED AND TESTED BY THE CONTRACTOR. * * *"

"A. IN ORDER TO BE ELIGIBLE TO RECEIVE AN AWARD THE BIDDER MUST MEET THE FOLLOWING QUALIFICATIONS:

"2. THE BIDDER SHALL HAVE DESIGNED AND BUILT AT LEAST 100 INTEGRATED UNIT SUBSTATIONS, INDOOR TYPE, 15 KV CLASS PRIMARY, 600 VOLT CLASS SECONDARY, 500 TO 1500 KVA CAPACITY, DURING THE FIVE YEAR PERIOD IMMEDIATELY PRECEDING THE DATE OF THIS INVITATION.'

IN A LETTER TO OUR OFFICE DATED DECEMBER 19, 1963, THE AEC REPORTS THAT COLUMBIA WAS FOUND TO BE NON-RESPONSIVE TO PARAGRAPH 2 OF THE TECHNICAL SPECIFICATIONS BECAUSE IT WAS NOT PROPOSING TO MANUFACTURE TRANSFORMERS OR DRAW-OUT TYPE CIRCUIT BREAKERS, BUT WOULD, INSTEAD, ASSEMBLE THOSE MANUFACTURED BY ANOTHER COMPANY (GENERAL ELECTRIC COMPANY). COLUMBIA WAS ALSO FOUND TO BE NONRESPONSIVE TO PARAGRAPH 6 (A) (2) OF BIDDER'S QUALIFICATIONS BECAUSE NO MORE THAN 34 UNITS MANUFACTURED BY COLUMBIA ELECTRIC IN THE PAST FIVE YEARS COULD BE CONSIDERED COMPARABLE TO THOSE SPECIFIED.

COLUMBIA PROTESTED THE PROPOSED REJECTION OF ITS BID TO AETRON BLUME- ATKINSON BY LETTER OF SEPTEMBER 24, 1963. BY LETTER DATED SEPTEMBER 25, 1963, AETRON-BLUME-ATKINSON CONFIRMED IN WRITING TO COLUMBIA THAT IT HAD RECOMMENDED TO STANFORD THAT STANFORD CONCUR IN ITS DECISION TO REJECT COLUMBIA'S BID. ON OCTOBER 1, 1963, YOU PROTESTED TO THE AEC THAT THE REQUIREMENTS OF THE INVITATION FOR BIDS WERE UNDULY RESTRICTIVE AND UNNECESSARILY LIMITED THE NUMBER OF POTENTIALLY ELIGIBLE COMPETITORS. LETTER OF NOVEMBER 5, 1963, YOU WERE ADVISED BY THE MANAGER OF THE AEC'S PALO ALTO AREA OFFICE THAT THE SPECIFICATIONS UTILIZED, WHILE PERHAPS HAVING THE EFFECT OF LIMITING THE NUMBER OF BIDDERS, WERE NECESSARY TO MEET THE SPECIFIC REQUIREMENTS OF THE ACCELERATOR PROJECT. ON NOVEMBER 6, THE AEC CONCURRED IN STANFORD UNIVERSITY'S RECOMMENDATION THAT COLUMBIA'S BID SHOULD BE REJECTED AND THE AWARD MADE TO FEDERAL PACIFIC ELECTRIC COMPANY. THE AWARD WAS MADE TO FEDERAL PACIFIC ON NOVEMBER 7, 1963.

WITH REFERENCE TO THE INVITATION REQUIREMENT THAT THE CONTRACTOR MANUFACTURE THE TRANSFORMERS AND DRAW-OUT TYPE CIRCUIT BREAKERS YOU CONTEND (LETTER OF OCTOBER 1 TO THE AEC) THAT THIS REQUIREMENT IS RESTRICTIVE AND CONTRARY TO AEC PROCUREMENT REGULATIONS--- SPECIFICALLY THOSE CONTAINED IN 10 CFR 5.21, 41 CFR 9-1.307 AND 41 CFR 9-2.102. YOU SAY IT APPEARS THAT AETRON-BLUME-ATKINSON SET OUT BY DESIGN TO LIMIT COMPETITION ON THE PROCUREMENT AND THAT SUCH ACTION IS UNJUSTIFIED WHEN THE SUBSTANTIVE NATURE OF A UNIT SUBSTATION IS CONSIDERED. THE DEVICE, YOU SAY, CONSISTS OF A PRIMARY SWITCH, A TRANSFORMER AND LOW VOLTAGE PROTECTIVE AND CONTROL DEVICES, ALL JOINED TOGETHER MECHANICALLY AND ELECTRICALLY TO CONSTITUTE AN INTEGRAL DISTRIBUTION UNIT. IT IS YOUR CONTENTION THAT THERE IS NO ADVANTAGE TO BE GAINED BY THE AEC AS FAR AS THE COMPONENTS ARE CONCERNED, SINCE COLUMBIA HAS OFFERED TO FURNISH THE SAME COMPONENTS THAT WOULD BE FURNISHED BY THE GENERAL ELECTRIC COMPANY, ONE OF THE FEW MANUFACTURERS WHO MEETS THE SPECIFICATION REQUIREMENTS, AND YOU QUESTION WHETHER THE LIMITATION ON COMPETITION CAN BE JUSTIFIED BY ANY ADVANTAGE TO BE GAINED IN MECHANICAL OR ELECTRICAL ASSEMBLY.

YOU FURTHER CONTEND THAT IT IGNORES REALITY TO SAY THAT THE TECHNICAL AND ENGINEERING RESOURCES OF A NATIONAL ELECTRICAL MANUFACTURER WILL MAKE ANY DIFFERENCE IN "MERE SHEET METAL AND COPPER ASSEMBLY" AND THAT "THE ONLY SIGNIFICANT TEST OF THE MECHANICAL ASSEMBLY IS ITS ABILITY TO WITHSTAND THE STRESS OF THE MAXIMUM SHORT CIRCUIT CURRENT EXPECTED.' COLUMBIA, YOU SAY, WILL MEET THIS REQUIREMENT OF THE SPECIFICATION AND WILL SO ENCLOSE THE GENERAL ELECTRIC COMPONENTS THAT THERE WILL BE NO DIFFERENCE IN OPERATING TEMPERATURE RISE CHARACTERISTICS FROM THAT OF EQUIPMENT MANUFACTURED WHOLLY BY GENERAL ELECTRIC. YOU ALLEGE THAT THE SAME APPLIES TO THE ELECTRICAL POWER ASSEMBLY: "IT REQUIRES NO DEGREE OF ENGINEERING SOPHISTICATION BEYOND COLUMBIA'S CAPACITY TO ASSEMBLE COPPER BUS.'

WITH RESPECT TO THE EXPERIENCE REQUIREMENT SET FORTH IN PARAGRAPH 6 (A) (2) OF BIDDER'S QUALIFICATIONS IN INSTRUCTIONS TO BIDDERS, YOUR LETTER TO US OF NOVEMBER 12, 1963, STATES, IN PERTINENT PART, AS FOLLOWS:

"* * * COLUMBIA RECOGNIZES THAT THE AWARD OF A CONTRACT MAY BE LIMITED TO THOSE BIDDERS MEETING SPECIFIED QUALITATIVE AND QUANTITATIVE EXPERIENCE REQUIREMENTS. BUT THE REJECTION OF BIDS OF RESPONSIBLE BIDDERS BECAUSE AS A TECHNICAL MATTER THEY DO NOT MEET PRESCRIBED EXPERIENCE QUALIFICATIONS, WHICH QUALIFICATIONS DO NOT OF THEMSELVES INSURE RESPONSIBILITY ON THE PART OF A BIDDER, SHOULD NOT BE CONDONED. THE QUESTION OF THE RESPONSIBILITY OF A BIDDER MUST BE ANSWERED ON THE MERITS IN EACH PARTICULAR INSTANCE, AND NEITHER THE COMMISSION NOR ITS COST TYPE CONTRACTORS SHOULD BE ALLOWED TO TRANSFORM THE FACTUAL QUESTION OF RESPONSIBILITY INTO THE LEGAL QUESTION OF CONFORMITY TO ARBITRARY REQUIREMENTS OF THE INVITATION (CITING B-151580, JUNE 4, 1963, AND B- 152334, SEPTEMBER 17, 1963). NO JUDGMENT HAS BEEN MADE, ON THE BASIS OF THE FACTS PRESENTED, AS TO THE RESPONSIBILITY OF COLUMBIA TO MEET THE COMMISSION'S REQUIREMENTS IN THIS PROJECT.'

THE STANDARDS REGARDING COMPETITIVE BIDDING CONTAINED IN THE REGULATIONS CITED IN YOUR LETTER OF OCTOBER 1 ARE NOT SPECIFICALLY APPLICABLE TO PURCHASES BY AEC COST-TYPE CONTRACTORS. APPLICABLE COMPETITIVE STANDARDS FOR PURCHASES BY SUCH CONTRACTORS ARE CONTAINED IN SUBPART E, SECTION 5.401 ET SEQ., TITLE 10, CODE OF FEDERAL REGULATIONS. PERTINENT REGULATIONS IN SUBPART E PROVIDE THAT COST-TYPE CONTRACTORS SHALL EFFECT THEIR PROCUREMENTS IN THE MANNER MOST ADVANTAGEOUS TO THE GOVERNMENT- PRICE, QUALITY AND OTHER FACTORS CONSIDERED (10 CFR 5.501), AND BY METHODS CALCULATED TO ASSURE SUCH FULL AND FREE COMPETITION AS IS CONSISTENT WITH SECURING THE REQUIRED SUPPLIES OR SERVICES. (10 GFR 5.503).

THE PROVISIONS OF 41 GFR 9-1.307 STATE THAT:

"SPECIFICATIONS SHOULD BE IN SUCH TERMS AS TO PERMIT FULL AND FREE COMPETITION AMONG ALL POTENTIAL SUPPLIERS. HOWEVER, TECHNICAL REASONS MAY OCCASIONALLY EXIST FOR USING SPECIFICATIONS WHICH LIMIT COMPETITION BY REQUIRING CERTAIN TYPES OF MATERIAL OR ARTICLES, SUCH AS REPLACEMENT PARTS, AUXILIARY EQUIPMENT AND TOOLS REQUIRED FOR USE WITH MAJOR EQUIPMENT. RESTRICTIVE SPECIFICATIONS MAY BE USED TO MEET SPECIAL REQUIREMENTS, PROVIDED, (A) AEC NEEDS CANNOT REASONABLY BE MET IN ANY OTHER MANNER, AND (B) A COMPLETE JUSTIFICATION FOR THE RESTRICTION IS REDUCED TO WRITING AND INCLUDED IN THE CONTRACT FILE.'

AEC MANAGERS OF OPERATIONS ARE RESPONSIBLE FOR OBTAINING COMPLIANCE BY COST-TYPE CONTRACTORS WITH THE POLICIES AND PROCEDURES SET FORTH IN SECTION 9-1.307 TO THE EXTENT PRACTICABLE AND COMPATIBLE WITH MEETING PROGRAM OBJECTIVES. SEE 41 CFR 9-1.305.1.

WE HAVE HELD THAT THE AWARD OF A CONTRACT MAY BE LIMITED TO THOSE BIDDERS MEETING SPECIFIED QUALITATIVE AND QUANTITATIVE EXPERIENCE REQUIREMENTS IN A SPECIALIZED FIELD WHERE THE BIDDING CONDITIONS SO PROVIDE AND A DETERMINATION HAS BEEN MADE THAT THE INTERESTS OF THE GOVERNMENT WOULD BE SERVED BY SUCH LIMITATION. 37 COMP. GEN. 196, ID. 420, AND DECISIONS CITED THEREIN. IN 37 COMP. GEN. 196 WE ALSO HELD THAT SINCE THE SELECTION OF A PRIME CONTRACTOR COULD BE LIMITED TO THOSE HAVING THE NECESSARY EXPERIENCE IN THE PARTICULAR FIELD, THE SAME LIMITATION COULD BE APPLIED TO THE SELECTION BY THE PRIME CONTRACTOR OF THE SUBCONTRACTORS TO PERFORM THE WORK IN WHICH THE SPECIALIZED EXPERIENCE WAS DEEMED NECESSARY. HOWEVER, IN 39 COMP. GEN. 173, WE INDICATED THAT OUR OFFICE DOES NOT CONDONE THE REJECTION OF BIDS OF RESPONSIBLE BIDDERS BECAUSE AS A TECHNICAL MATTER THEY DO NOT MEET PRESCRIBED EXPERIENCE QUALIFICATIONS. IN THAT CONNECTION, WE SAID AT PAGE 178 THAT "THE STATEMENT OF SUCH QUALIFICATIONS SHOULD NOT BE CONSIDERED AS HAVING THE EFFECT OF TRANSFORMING THE PURELY FACTUAL QUESTION OF RESPONSIBILITY INTO A LEGAL QUESTION OF CONFORMITY TO THE INVITATION.' THESE PRINCIPLES WERE CONFIRMED IN OUR DECISIONS OF JUNE 4, 1963, (B-151580) AND SEPTEMBER 17, 1963, (B-152334), BOTH OF WHICH WERE CITED IN YOUR LETTER OF NOVEMBER 12.

ASSUMING, ARGUENDO, THAT THESE PRINCIPLES ARE APPLICABLE TO PROCUREMENTS BY AEC PRIME CONTRACTORS AND SUBCONTRACTORS, AND ASSUMING FURTHER THAT WHEN MEASURED AGAINST THESE PRINCIPLES THE EXPERIENCE REQUIREMENTS OF PARAGRAPH 6 (A) (2) OF BIDDER'S QUALIFICATIONS MAY BE CONSIDERED UNDULY RESTRICTIVE, WE NEVERTHELESS MUST CONCLUDE THAT THE AWARD OF THE CONTRACT TO FEDERAL PACIFIC WAS PROPER AND NOT SUBJECT TO OBJECTION BY OUR OFFICE. THIS IS SO BECAUSE WE THINK THAT THE PROVISIONS OF PARAGRAPH 2 OF THE TECHNICAL SPECIFICATIONS REQUIRING THAT BIDDERS MANUFACTURE THE NECESSARY TRANSFORMERS AND DRAW-OUT TYPE CIRCUIT BREAKERS (WHICH REQUIREMENTS COLUMBIA ADMITTEDLY DOES NOT MEET) ARE NOT UNDULY RESTRICTIVE SINCE AEC NEEDS CANNOT REASONABLY BE MET IN ANY OTHER MANNER. SEE 41 CFR 9-1.307.

ENCLOSED WITH THE FILE SUBMITTED TO OUR OFFICE BY THE AEC IS A DOCUMENT DATED OCTOBER 11, 1963, ENTITLED "AETRON-BLUME-ATKINSON'S RECOMMENDATIONS.' THE FOLLOWING OBSERVATIONS, AMONG OTHERS, ARE MADE THEREIN. THE STANFORD LINEAR ACCELERATOR CENTER'S POWER REQUIREMENTS ARE SECOND TO VERY FEW POWER CONSUMERS. THE UNIT SUBSTATIONS ARE SUBJECT TO 500,000 KVA SHORT-CIRCUIT STRESSES. THE UNIT SUBSTATION SECONDARIES ARE SUBJECT TO 25,000 AMPS OVER 20,000 HORSE-POWER, ON A SOLID SHORT-CIRCUIT CONDITION. THESE POWER CAPACITIES, WHILE NOT FOREIGN TO INDUSTRY, ARE SEVERE AND REQUIRE FULLY TESTED AND COORDINATED COMPONENTS AND SYSTEMS. THE MAJOR COMPONENTS, TRANSFORMERS AND CIRCUIT-BREAKERS ARE ENGINEERED, DESIGNED, TESTED AND MANUFACTURED BY ONLY A FEW FIRMS. THESE COMPONENTS ARE SUBJECTED TO STANDARD AIEE, NEMA AND ASA TESTS. PROTOTYPE TESTS CHECK THE DESIGN AND MATERIALS. REGULAR PRODUCTION TESTS CHECK ON QUALITY CONTROL OF MANUFACTURE. THE COMPONENT TEST SERIES ENSURE THAT THE PARTS, AS SUCH, PERFORM THE SPECIFIED DUTY BUT DO NOT ENSURE THAT THE WHOLE OF THE SUBSTATION WILL DO THE JOB.

AETRON-BLUME-ATKINSON ALSO REPORTS THAT THE COMPONENTS ARE BUSSED, WIRED, WELDED AND BOLTED TOGETHER TO FORM AN ARTICULATED UNIT SUBSTATION AND THAT WHILE THE COMPONENTS ARE KEY PARTS, THE ASSEMBLY IS NO BETTER THAN THE MISCELLANEOUS MATERIALS THAT HOLD THE COMPONENTS TOGETHER, ELECTRICALLY AND MECHANICALLY. THE MISCELLANEOUS MATERIALS AND METHODS OF ASSEMBLY MUST BE COMPATIBLE WITH THE SPECIFIC COMPONENT DESIGN, NOT LAST YEAR'S MODEL OR TOMORROW'S CONCEPT. IT IS STATED THAT THOSE WHO FOLLOW UNIT SUBSTATION DESIGN WILL ATTEST TO THE FACT THAT MODEL CHANGES OCCUR ALMOST AS RAPIDLY AS MODEL CHANGES IN THE AUTOMOBILE FIELD. AETRON-BLUME- ATKINSON FURTHER STATES THAT THE ASSEMBLER CANNOT KEEP UP WITH THE AUTOMOTIVE TYPE OF MODEL CHANGES AND THAT THE ASSEMBLER DOES NOT HAVE THE FACILITIES TO MAKE FULL POWER ASSEMBLED TESTS: THE ASSEMBLER "PICKS UP A FEW WORDS OF WISDOM FROM HIS COMPONENT MANUFACTURER, BUT HE DOES NOT GET THE MANUFACTURER'S CORPORATE SECRETS THAT ARE THE RESULT OF YEARS OF EXPERIENCE, FIELD APPLICATION, AND COSTLY RESEARCH PROGRAMS.'

THE RECOMMENDATIONS OF STANFORD UNIVERSITY DATED OCTOBER 16, 1963, CONTAIN THE FOLLOWING OBSERVATIONS:

"THE FOUR FIELDS IN WHICH ASSURANCE OF DEPENDABILITY IS VITAL ARE: (A) COMPONENTS, (B) MAINTENANCE, (C) ASSEMBLY OF THE SUBSTATION, AND (D) CONSTRUCTION OF THE ENCLOSURE. THE CALIBRE OF COMPONENT PERFORMANCE IS FUNDAMENTALLY THAT OF THE MANUFACTURER'S STANDARDS AND THE COMPETENCE OF HIS ENGINEERING STAFF. AS TO MAINTENANCE, IT IS AXIOMATIC THAT REAL EFFECTIVENESS IS BASED ON THE AVAILABILITY OF MAINTENANCE OR REPLACEMENT PARTS, AND THE DEGREE OF THEIR INTERCHANGEABILITY. THE NEED TO PLACE RESPONSIBILITY AND MAKE IMMEDIATE REPAIRS, EITHER UNDER THE APPARATUS GUARANTEE OR THE COMPONENT MANUFACTURER'S REPAIR PART STOCK PLAN, IS SATISFIED ONLY WHEN BOTH ARE SUPPLIED FROM ONE SOURCE. THE ASSURANCE OF COMBINED COMPONENT AND ASSEMBLY PERFORMANCE IS SECURE ONLY WHEN OBTAINED FROM A COMPANY WHICH IS BOTH COMPONENT MANUFACTURER, ENCLOSURE FABRICATOR AND ASSEMBLER. TO PROVIDE THIS ASSURANCE MANUFACTURER-ASSEMBLERS HAVE COMPLETE FACILITIES FOR PERFORMANCE TESTING THE FINISHED SUBSTATION UNIT AS WELL AS PRODUCTION QUALITY TESTING OF MAJOR COMPONENTS. THE MAGNITUDE AND COMPLEXITY OF THIS EQUIPMENT REQUIRES A CONTINUITY OF THE SUPPLIER'S FIELD ENGINEERING SERVICE THROUGH AND AFTER INSTALLATION. ONLY AN INTEGRATED COMPANY HAS THE ENGINEERING STAFF TO FULFILL THIS REQUIREMENT.

"PERSONNEL SAFETY IS AN IMPORTANT ASPECT OF OUR WORK AND THIS TOO IS BASED ON DEPENDABILITY. A DISRUPTIVE EXPLOSION OF A SUBSTATION ENCLOSURE COULD BE CRUCIAL BECAUSE OF THE SIZE AND ARRANGEMENT OF THE LABORATORY'S PHYSICAL PLANT AND THE CLOSE PROXIMITY OF OPERATING PERSONNEL. ASSURANCE OF DEPENDABILITY HERE IS A PRIMARY ENGINEERING FUNCTION OF THE ENCLOSURE AND THE STRUCTURAL ARRANGEMENT OF ASSEMBLED COMPONENTS.

"IN URGING THAT THE CONTRACT BE AWARDED TO A MANUFACTURER-ASSEMBLER, WE ARE BASING OUR RECOMMENDATION ON OUR ORGANIZATION'S FAMILIARITY WITH USER APPLICATION PROBLEMS, AND ALSO OUR ENGINEERS' EXPERIENCE WITH EQUIPMENT MANUFACTURE AND INDUSTRY PRACTICE.'

IT IS REPORTED THAT THE AEC FULLY CONCURS IN THE RECOMMENDATIONS OF STANFORD UNIVERSITY AND AETRON-BLUME-ATKINSON.

IN VIEW OF THE CONSIDERATIONS, OUTLINED ABOVE, AS TO THE NEED FOR LIMITING COMPETITION TO BIDDERS WHO ARE MANUFACTURER-ASSEMBLERS, WE CANNOT SAY THAT THE PROVISIONS OF PARAGRAPH 2 OF THE TECHNICAL SPECIFICATIONS ARE UNDULY RESTRICTIVE OR CONTRAVENE APPLICABLE PROCUREMENT REGULATIONS. THE CONTRARY, WE THINK THAT THE REQUIREMENTS OF PARAGRAPH 2 OF THE TECHNICAL SPECIFICATIONS ARE IN THIS INSTANCE AMPLY SHOWN BY THE ADMINISTRATIVE RECORD TO BE NECESSARY TO INSURE THE RESPONSIBILITY OF THE SUCCESSFUL BIDDER. YOUR PROTEST MUST THEREFORE BE DENIED.