B-153499, AUG. 24, 1964

B-153499: Aug 24, 1964

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

INC.: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 11. TWENTY SOURCES WERE SOLICITED AND THREE BIDS WERE RECEIVED. THE LOWEST BID WAS SUBMITTED BY YOU AND WAS IN THE AMOUNT OF $239.11 EACH OR A TOTAL OF $90. THE SECOND LOW BID WAS SUBMITTED BY R. WAS IN THE AMOUNT OF $242.90 EACH OR A TOTAL OF $91. YOUR BID WAS REJECTED AND THE BID OF ALLEN WAS ACCEPTED. YOUR BID WAS CONSIDERED NONRESPONSIVE TO THE TERMS AND CONDITIONS OF THE INVITATION FOR BIDS IN THAT YOU FAILED TO SHOW IN YOUR DESCRIPTIVE LITERATURE THAT THE PRODUCT YOU OFFERED CONFORMED TO THE SPECIFICATIONS. BEFORE THE INVITATION FOR BIDS WAS ISSUED. IT WAS DECIDED THAT SINCE THE ITEM BEING PROCURED WAS HIGHLY TECHNICAL AND COMPLEX A DESCRIPTIVE LITERATURE REQUIREMENT WOULD BE NECESSARY FOR INCLUSION IN THE INVITATION IN ORDER TO ESTABLISH THE CONTRACTOR'S PRODUCT ACCEPTABILITY AS TO DESIGN.

B-153499, AUG. 24, 1964

TO ASSEMBLY ENGINEERS, INC.:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 11, 1964, PROTESTING THE REJECTION OF YOUR BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. 33- 657-64-83 ISSUED BY THE AERONAUTICAL SYSTEMS DIVISION, WRIGHT PATTERSON AIR FORCE BASE, OHIO, ON OCTOBER 29, 1963.

THE CITED INVITATION SOLICITED BIDS--- TO BE OPENED ON DECEMBER 3, 1963-- - FOR FURNISHING 377 TRANSMITTERS, RATE GYROSCOPE, TYPE TRU 2A/A, IN ACCORDANCE WITH SPECIFICATION MIL-T-27200A DATED FEBRUARY 8, 1963, AND AMENDMENT NO. 1 THERETO DATED AUGUST 19, 1963. TWENTY SOURCES WERE SOLICITED AND THREE BIDS WERE RECEIVED. THE LOWEST BID WAS SUBMITTED BY YOU AND WAS IN THE AMOUNT OF $239.11 EACH OR A TOTAL OF $90,144.47. THE SECOND LOW BID WAS SUBMITTED BY R. C. ALLEN BUSINESS MACHINES, INC., AND WAS IN THE AMOUNT OF $242.90 EACH OR A TOTAL OF $91,573.30. YOUR BID WAS REJECTED AND THE BID OF ALLEN WAS ACCEPTED. YOUR BID WAS CONSIDERED NONRESPONSIVE TO THE TERMS AND CONDITIONS OF THE INVITATION FOR BIDS IN THAT YOU FAILED TO SHOW IN YOUR DESCRIPTIVE LITERATURE THAT THE PRODUCT YOU OFFERED CONFORMED TO THE SPECIFICATIONS.

BEFORE THE INVITATION FOR BIDS WAS ISSUED, IT WAS DECIDED THAT SINCE THE ITEM BEING PROCURED WAS HIGHLY TECHNICAL AND COMPLEX A DESCRIPTIVE LITERATURE REQUIREMENT WOULD BE NECESSARY FOR INCLUSION IN THE INVITATION IN ORDER TO ESTABLISH THE CONTRACTOR'S PRODUCT ACCEPTABILITY AS TO DESIGN, MATERIAL, COMPONENTS, PERFORMANCE CHARACTERISTICS, CONSTRUCTION AND ASSEMBLY. ON PAGES 15 AND 16 OF THE INVITATION THERE WERE SET OUT THE REQUIREMENTS FOR DESCRIPTIVE LITERATURE AND WHAT SUCH LITERATURE WAS REQUIRED TO SHOW. IT WAS PROVIDED THAT THE FAILURE OF DESCRIPTIVE LITERATURE TO SHOW THAT THE PRODUCT OFFERED CONFORMS TO THE SPECIFICATION AND OTHER REQUIREMENTS OF THE INVITATION "WILL REQUIRE REJECTION OF THE BID.' ALSO, IT WAS REQUIRED THAT THE DESCRIPTIVE LITERATURE BE FURNISHED BY THE TIME SET FOR THE OPENING OF BIDS, SUBJECT TO THE PROVISION FOR CONSIDERING LATE BIDS. THE REQUIREMENT COULD ALSO BE WAIVED IN CERTAIN CASES NOT HERE INVOLVED.

WHEN YOUR BID WAS RECEIVED, THE DESCRIPTIVE LITERATURE SUBMITTED THEREWITH WAS FORWARDED TO THE RESPONSIBLE ENGINEERING LABORATORY FOR EVALUATION. THE REQUESTED EVALUATION WAS RECEIVED ON DECEMBER 10, 1963, WITH A NOTE AS TO DEVIATION AS FOLLOWS:

"THE OUTLINE DRAWING, * * * 616-100, SHOWS THE WIDTH OF THE CAN TO BE 1 3/4 INCHES PLUS OR MINUS 1/64 INCH. MIL-T-27200A/1) REQUIRES A WIDTH OF 2 3/8 INCHES PLUS OR MINUS 1/64 INCH. THIS IS A DEVIATION TO THE SPECIFICATION.' BASED UPON THE ABOVE DEVIATION, THE PROCUREMENT OFFICE DETERMINED YOUR BID TO BE NONRESPONSIVE TO THE TERMS AND CONDITIONS OF THE INVITATION AND AWARDED THE CONTRACT TO ALLEN. BY LETTER OF JANUARY 31, 1964, YOU WERE FURNISHED INFORMATION AS TO THE REASONS FOR THE REJECTION OF YOUR BID. ON FEBRUARY 3, 1964, A REPRESENTATIVE OF YOUR FIRM MET WITH REPRESENTATIVES OF THE GOVERNMENT TO DISCUSS THE ENGINEERING PROBLEMS INVOLVED. YOUR REPRESENTATIVE CONTESTED THE AIR FORCE ENGINEERING CONTENTION THAT THE AREA OF DEVIATION WOULD PRECIPITATE AN INTERCHANGEABILITY PROBLEM OF CRITICAL SIGNIFICANCE.

AFTER THE RECEIPT OF YOUR LETTER OF PROTEST DATED FEBRUARY 11, 1964, THE MATTER WAS REFERRED BY OUR OFFICE TO THE DEPARTMENT OF THE AIR FORCE FOR A REPORT AS TO THE FACTS INVOLVED. THERE WAS SOME DIFFERENCE OF OPINION AS TO WHETHER YOUR PRODUCT MET THE SPECIFICATION BECAUSE THE UNIT YOU OFFERED DIFFERED IN SHAPE FROM THE MILITARY SPECIFICATION, AND ALSO AS TO WHETHER THIS WAS A MAJOR DEVIATION OR ONLY A MINOR DEVIATION WHICH SHOULD HAVE BEEN WAIVED BY THE PROCURING OFFICE, AERONAUTICAL SYSTEMS DIVISION (ASD), WRIGHT-PATTERSON AIR FORCE BASE, OHIO. THE COGNIZANT ENGINEERING GROUP AT ASD INFORMED THE CONTRACT NEGOTIATOR ON APRIL 15, 1964, AS FOLLOWS:

"3. THE AEI UNIT DIFFERS IN SHAPE FROM THAT REQUIRED BY MILITARY SPECIFICATION IN TWO WAYS (SEE ATTACHED DRAWING):

"A. THE UNIT IS NARROWER WHICH ALLOWS AN AIRFRAME CONTRACTOR IN NEW INSTALLATIONS TO USE THE SPACE SAVED FOR OTHER EQUIPMENT. SUCH AN ACTION WOULD PRECLUDE USE OF EXISTING UNITS, THAT ARE IN THE FIELD, FOR REPLACEMENT.

"B. THE UNIT EXTENDS BEYOND THE SHAPE ALLOWED IN THE MILITARY SPECIFICATION. THIS EXTENSION MAY INTERFERE WITH AIRFRAME SUPPORTS, SHELF SUPPORTS OR WIRING IN PRESENT AIRCRAFT. THE TRU-2A/A IS PRESENTLY USED IN F-105, F-106, T-38, B-52, C-141, TFX, T-39 (USAF AND NAVY), CH-3C, AND C- 130 AIRCRAFT.

"5. * * * IN IFB EVALUATION, DEVIATIONS ARE NOT TREATED AS MAJOR OR MINOR. DISTINCTIONS OF SUCH A NATURE ARE IMPOSSIBLE, BOTH FROM AN AF EVALUATOR'S POINT OF VIEW AND FROM A PROSPECTIVE BIDDER'S POINT OF VIEW. SOME DEVIATIONS WOULD ALLOW A CONTRACTOR TO SHAVE HIS PRICE AND PLACE HIM IN A MORE FAVORABLE COMPETITIVE POSITION. SUCH A SITUATION WOULD LEAVE THE EVALUATORS OPEN TO A WIDE RANGE OF CRITICISM AND FORM THE BASIS OF PROTESTS FROM UNSUCCESSFUL BIDDERS.

"6. THE TRU-2A/A PROVIDES THE SIGNAL TO THE RATE-OF-TURN NEEDLE WHICH IS USED AS A LAST RESORT WHEN THE PRIMARY ATTITUDE INDICATOR HAS FAILED. DUE TO THIS FACT, THE IMPORTANCE OF THIS UNIT CANNOT BE OVERLOOKED. TO TAKE THE CASE ONE STEP FURTHER, IT CAN BE STATED WITHOUT RESERVATION THAT IF THE PRESENT CONTRACTOR PROPOSED BY ECP TO CHANGE HIS UNIT TO ONE AS PROPOSED BY AEI, HIS REQUEST WOULD BE DISAPPROVED BY AIR FORCE CONFIGURATION CONTROL, AIR FORCE ENGINEERING AND BY THE SPO'S WHICH UTILIZE THE UNIT.' THE ENGINEERING PERSONNEL EVALUATING THE DESCRIPTIVE LITERATURE ALSO FELT THAT "A HARD LINE" SHOULD BE "DRAWN AT THE SPECIFICATION REQUIREMENTS" AND THEREFORE NO DEVIATION, EVEN MINOR, FROM THE SPECIFICATION REQUIREMENTS SHOULD BE PERMITTED. THE HEADQUARTERS, AIR FORCE SYSTEMS COMMAND (AFSC), IN A LETTER OF APRIL 24, 1964, TO THE HEADQUARTERS, UNITED STATES AIR FORCE, STATED THAT THE QUESTION AS TO WHETHER OR NOT DESCRIPTIVE LITERATURE "CONFORMS TO THE SPECIFICATIONS" WAS A TECHNICAL DETERMINATION TO BE MADE BY COGNIZANT ENGINEERS AND STATED THAT IT WAS ITS CONSISTENT POSITION IN HARMONY WITH DETERMINATION OF OUR OFFICE THAT, IN THE ABSENCE OF CLEAR AND COGENT EVIDENCE OF IMPROPRIETY OR ERROR, IT SHOULD NOT SUBSTITUTE ITS JUDGMENT "FOR THAT OF COGNIZANT AIR FORCE TECHNICAL PERSONNEL.' ALSO, IT WAS STATED THAT THERE WAS NO EVIDENCE OF IMPROPRIETY OR ERROR. THEREAFTER, ON MAY 4, 1964, AFSC WAS REQUESTED TO FURNISH A DEFINITE STATEMENT THAT THE SHAPE OF THE CAN PROPOSED BY YOU WOULD OR WOULD NOT INTERFERE WITH AIRFRAME IN PRESENT AIRCRAFT AND TO IDENTIFY THE AIRCRAFT AND THE PARTICULAR PARTS SUCH AS FUEL LINES, WIRING, ETC., WHICH WOULD BE AFFECTED. THE REPLY OF AFSC TO HEADQUARTERS, UNITED STATES AIR FORCE, ADMITS THAT THERE WOULD HAVE BEEN NO PHYSICAL INTERFERENCE WITH AIRFRAMES IN THIS INSTANCE AND THE REPLY IS IN PERTINENT PART AS FOLLOWS:

"ALTHOUGH * * * THERE IS NO PHYSICAL INTERFERENCE WITH THE AIR FRAMES IN THIS INSTANCE THIS HEADQUARTERS STRONGLY CONCURS WITH THE POSITION OF ASD THAT ASSEMBLY ENGINEERS WAS PROPERLY DECLARED NONRESPONSIVE. IT IS FELT THAT NONINTERFERENCE IN THIS INSTANCE WAS SIMPLY A MATTER OF FORTUNE WHICH CANNOT BE RELIED UPON TO CONSISTENTLY REPEAT ITSELF IN THE FUTURE. IF THE JUDGMENT OF THE ASD ENGINEERS IS OVERRULED IN THIS CASE, IT IS FELT THAT THIS DECISION MAY WELL ESTABLISH A PRECEDENT WHICH WILL ULTIMATELY WORK TO THE DISADVANTAGE OF CONTRACTORS AS WELL AS THE AIR FORCE. IF A CONTRACTOR WAS ALLOWED, AS A MATTER OF COURSE, TO PROPOSE DEVIATIONS FROM SPECIFICATION REQUIREMENTS OF SIZE AND/OR SHAPE OF A GIVEN ITEM WITH THE AIR FORCE HAVING THE BURDEN OF PROOF OF SHOWING, THROUGH AFFIRMATIVE MEASUREMENTS AS IN THIS CASE, THAT THE PROPOSAL IS UNACCEPTABLE THE RESULTS WOULD BE CHAOTIC. IT REQUIRES NO EXTREME STRETCH OF THE IMAGINATION TO VISUALIZE A SITUATION IN WHICH A PROPOSED SIZE DEVIATION COULD NOT BE RESOLVED BECAUSE OF A SIMILAR REQUEST FOR SIZE DEVIATION FOR ONE OR MORE ADJOINING ITEMS. THUS, SELECTION OF CONTRACTORS FOR AWARD COULD BE BOGGED DOWN FOR INDEFINITE PERIODS OF TIME, TO THE DETRIMENT OF ALL. TO AVOID THIS RESULT, IT IS THE POSITION OF THIS HEADQUARTERS THAT WE SHOULD CONTINUE TO FOLLOW OUR CONSISTENT PRACTICE, APPROVED BY THE COMPTROLLER GENERAL, OF RELYING ON THE JUDGMENT OF OUR TECHNICAL PERSONNEL IN THE ABSENCE OF CLEAR EVIDENCE OF IMPROPRIETY OR ERROR.

"WHATEVER THE MERITS OF OTHER ARGUMENTS IN THE INSTANT CASE, IT IS FELT THAT THE CONTRACT WITH R. C. ALLEN HAS PROGRESSED TOO FAR FOR TERMINATION WITH A VIEW TO AWARD TO ASSEMBLY ENGINEERS TO BE ECONOMICALLY FEASIBLE. OUT OF THE TOTAL CONTRACT PRICE OF $75,056.00, $67,358.00 WOULD REPRESENT A MINIMUM TERMINATION LIABILITY AS FOLLOWS:

BILLED AND PAID - $ 9,489.00

WORK IN PROGRESS BUT NOT INVOICED - $27,044.00

COMMITMENTS TO SUBCONTRACTORS, ETC. - $30,825.00

"IT IS AGAIN THE RECOMMENDATION OF THIS HEADQUARTERS THAT THE SUBJECT PROTEST BE DENIED AS WITHOUT MERIT.'

THE REPORT IN THIS CASE INDICATES THAT HAD THIS MATTER COME TO THE ATTENTION OF THE HEADQUARTERS, UNITED STATES AIR FORCE, PRIOR TO THE AWARD,"WE WOULD HAVE DIRECTED THAT THE AWARD BE MADE TO AEI.' WE AGREE WITH THE CONCLUSION ARRIVED AT IN THIS CASE THAT MINOR OR INSIGNIFICANT CHANGES TO A SPECIFICATION THAT HAVE NO BEARING ON THE QUANTITY, QUALITY, COST, DELIVERY OR PERFORMANCE CHARACTERISTICS OF AN ITEM SHOULD BE WAIVED IN PROPER CASES. TO DO SO WOULD BE IN THE INTEREST OF THE GOVERNMENT AND SHOULD NOT BE REGARDED AS PREJUDICIAL TO THE RIGHTS OF ANY OTHER BIDDERS. AND WHILE THE JUDGMENT OF TECHNICAL PERSONNEL EVALUATING DESCRIPTIVE LITERATURE SHOULD NOT BE LIGHTLY BRUSHED ASIDE, THE TECHNICAL PERSONNEL SHOULD NOT REFUSE TO CONSIDER CHANGES TO A SPECIFICATION BY A BIDDER TO DETERMINE WHETHER THEY ARE MINOR OR OF SOME CONSEQUENCE SO THAT THE GOVERNMENT MAY AVAIL ITSELF OF LOWER PRICES IN APPROPRIATE CASES. THIS POSITION DOES NOT INVOLVE THE REFUSAL TO ACCEPT THE DETERMINATION OF TECHNICAL PERSONNEL BUT ONLY ASKS THAT THE TECHNICAL PERSONNEL TAKE INTO ACCOUNT CERTAIN FACTORS IN MAKING THEIR DETERMINATION.

IN VIEW OF THE FACT THAT THERE HAS BEEN SUBSTANTIAL PERFORMANCE UNDER THE SUBJECT CONTRACT, IT WOULD NOT BE IN THE BEST INTEREST OF THE GOVERNMENT TO TERMINATE THE CONTRACT AWARDED TO ALLEN AND THEREFORE YOUR PROTEST IS DENIED.