B-154317, SEP. 14, 1964

B-154317: Sep 14, 1964

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IT IS CONTENDED THAT THE INVITATION AS ISSUED IS RESTRICTIVE OF COMPETITION SINCE IT INCORPORATES THE DRAWINGS OF THE FWD CORPORATION. ARE AT A DISTINCT DISADVANTAGE SINCE THEY WOULD BE REQUIRED TO FURNISH PARTS AND COMPONENTS PRODUCED BY FWD OR MANUFACTURED FROM THE FWD DRAWINGS. IT IS ALSO CONTENDED THAT THE FWD DRAWINGS FURNISHED WITH THE INVITATION ARE OF POOR QUALITY. FOR BIDDERS TO DETERMINE THE ADEQUACY AND COMPLETENESS OF THE DRAWINGS AS IS REQUIRED OF BIDDERS BY PARAGRAPH 4 OF THE INVITATION. A PROTEST WAS MADE ON THE BASIS THAT THE PROPRIETARY COMPONENTS (AXLES) HAD TO BE PURCHASED FROM FWD AND THAT FWD. THE SIGNIFICANCE OF THIS DISPARITY IS APPARENT NOT ONLY FROM THE EMERGENCY NATURE OF THE NEED INTENDED TO BE SERVED BY THE FIRE FIGHTING TRUCKS.

B-154317, SEP. 14, 1964

TO AMERICAN LAFRANCE - AUTOMOTIVE:

BY LETTER DATED MAY 26, 1964, WITH ATTACHMENT, AS SUPPLEMENTED BY YOUR LETTER OF AUGUST 28, 1964, YOU PROTESTED AGAINST THE SPECIFICATIONS IN INVITATION FOR BIDS NO. 09-603-64-845, ISSUED BY WARNER ROBINS AIR MATERIEL AREA, DEPARTMENT OF THE AIR FORCE, ON MARCH 25, 1964.

THE INVITATION, AS AMENDED, REQUESTED BIDS FOR FURNISHING 41 AIRCRAFT FIRE FIGHTING TRUCKS, TYPE A/S32P-2, IN ACCORDANCE WITH SPECIFICATION MIL- T-27213C (USAF), DATED JULY 5, 1963, TOGETHER WITH CERTAIN DATA AND TESTING REQUIREMENTS. IT IS CONTENDED THAT THE INVITATION AS ISSUED IS RESTRICTIVE OF COMPETITION SINCE IT INCORPORATES THE DRAWINGS OF THE FWD CORPORATION--- THE PREVIOUS PRODUCER--- AS REFERENCED IN DRAWING INDEX 531000 OF MIL-T-27213C. YOU STATE THAT ALL PROSPECTIVE BIDDERS, OTHER THAN FWD, ARE AT A DISTINCT DISADVANTAGE SINCE THEY WOULD BE REQUIRED TO FURNISH PARTS AND COMPONENTS PRODUCED BY FWD OR MANUFACTURED FROM THE FWD DRAWINGS. IT IS ALSO CONTENDED THAT THE FWD DRAWINGS FURNISHED WITH THE INVITATION ARE OF POOR QUALITY, MAKING IT DIFFICULT, IF NOT IMPOSSIBLE, FOR BIDDERS TO DETERMINE THE ADEQUACY AND COMPLETENESS OF THE DRAWINGS AS IS REQUIRED OF BIDDERS BY PARAGRAPH 4 OF THE INVITATION.

IN B-151273 DATED JULY 5, 1963, WE CONSIDERED A PRIOR ADVERTISED PROCUREMENT OF THESE FIRE FIGHTING TRUCKS UNDER ALMOST IDENTICAL SPECIFICATIONS AND WE CONCLUDED THAT IT WOULD NOT BE IN THE BEST INTERESTS OF THE GOVERNMENT TO OBJECT TO AN AWARD ON THE BASIS OF THE ADVERTISED RESTRICTIVE SPECIFICATIONS. IN THAT CASE, THE INVITATION SPECIFIED CERTAIN PROPRIETARY COMPONENTS OF THE TRUCK BY MANUFACTURER'S NAME (FWD) AND MODEL NUMBER. A PROTEST WAS MADE ON THE BASIS THAT THE PROPRIETARY COMPONENTS (AXLES) HAD TO BE PURCHASED FROM FWD AND THAT FWD, BY TYING THE SALE OF OTHER COMPONENTS TO THE SALE OF ITS AXLES AND QUOTING HIGH PRICES, HAD PREVENTED THE SUBMISSION OF COMPETITIVE BIDS. WE HELD, IN PERTINENT PART, THAT:

"THE AIR FORCE ADVISES US THAT THE NEED FOR MAINTENANCE AND FOR LOGISTIC SUPPORT ASSUMES INCREASED IMPORTANCE OVER THE SAME TYPE OF SUPPORT NEEDED FOR SNOWPLOWS. THE SIGNIFICANCE OF THIS DISPARITY IS APPARENT NOT ONLY FROM THE EMERGENCY NATURE OF THE NEED INTENDED TO BE SERVED BY THE FIRE FIGHTING TRUCKS, BUT ALSO FROM THE FACT THAT IN THE CASE OF SNOWPLOWS THE AIR FORCE AT LEAST ENJOYS A SUMMER RESPITE DURING WHICH THE VEHICLES MAY BE REHABILITATED, AND CAN THEREFORE AFFORD THE 30 DAYS WHICH ORDINARILY WILL ELAPSE BETWEEN THE REQUISITION AND THE DELIVERY OF MAJOR STANDARD SPARE PARTS FROM A GIVEN MANUFACTURER. IT CANNOT AFFORD THIS AMOUNT OF DOWN TIME FOR THE SUBJECT FIRE FIGHTING TRUCKS, AND IS REQUIRED TO KEEP CRITICAL SPARE PARTS AT EACH USING BASE FOR EMERGENCY EMPLOYMENT. THEREFORE, WE ARE ADVISED, EXPENDITURES IN THIS AND THE ONE PRIOR PROCUREMENT FOR SPARE PARTS WILL TOTAL ROUGHLY ONE MILLION DOLLARS. FOR EACH NEW SPARE PART, THE COST OF STOCK LISTING, TECHNICAL ORDERS AND STORAGE BINS WILL APPROXIMATE $1,000. IT THUS APPEARS THAT THE NEED FOR INTERCHANGEABILITY OF PARTS AND LOGISTIC SUPPORT FOR THESE FIRE FIGHTING TRUCKS IS OF SUCH CRITICAL SIGNIFICANCE AS TO JUSTIFY THE DEGREE OF RESTRICTION IMPOSED BY THE REQUIREMENT FOR FWD AXLES ONLY. IT MAY ALSO BE OBSERVED THAT THE NEED FOR INTERCHANGEABILITY OF PARTS IS JUSTIFICATION FOR NEGOTIATION. SEE 10 U.S.C. 2304 (A) (13) AND ASPR 3-213.

"YOU OBJECT TO THE FACT THAT FWD HAS REFUSED TO SELL ITS AXLE TO PROSPECTIVE BIDDERS UNLESS ITS TRANSFER ASSEMBLY AND COLLECTOR GEAR BOX WERE ALSO PURCHASED. IT APPEARS THAT SEVERAL MANUFACTURERS, INCLUDING THE ONE ON WHOSE PRODUCT YOU WISHED TO BASE YOUR BID, TIE THE SALE OF THEIR TRANSFER ASSEMBLIES TO THE SALE OF THEIR AXLES. FWD HAS CARRIED THIS ARRANGEMENT ONE STEP FURTHER BY INCLUDING ITS GEAR BOX ASSEMBLY, ALLEGEDLY ON THE GROUNDS THAT BOTH ASSEMBLIES ARE SO INTRICATELY CONNECTED WITH ITS AXLES THAT IT COULD SO INTRICATELY CONNECTED WITH ITS AXLES THAT IT COULD NOT GUARANTEE AND THEREFORE WOULD NOT SELL ITS AXLES WITHOUT THE ASSEMBLIES. THIS, OF COURSE, RAISES THE QUESTION WHETHER A BIDDER WHO IS THE SOLE SUPPLIER OF ONE OR MORE ITEMS, WHICH REPRESENT OVER 10 PERCENT OF THE COST OF THE PROCUREMENT, HAS BEEN AFFORDED AN OPPORTUNITY OF QUOTING PRICES WITHOUT FEAR OF REAL COMPETITION. IN VIEW OF WHAT WE HAVE ALREADY SAID, THE ANSWER TO BOTH THIS ISSUE AND THAT REGARDING THE ABSENCE OF AN "OR EQUAL" CLAUSE DEPENDS UPON WHETHER OR NOT THE RECORD CONTAINS AFFIRMATIVE EVIDENCE THAT THE PRICE SUBMITTED BY THE LOW BIDDER IS REASONABLE.'

IN THIS SOLICITATION, HOWEVER, IN ORDER TO ENCOURAGE COMPETITION, THE AIR FORCE AUTHORIZED THE FURNISHING OF AXLES AND TRANSFER ASSEMBLY EQUAL TO THOSE SPECIFIED IN THE DRAWINGS AND SPECIFICATIONS BUT ANY BIDDER OFFERING THE EQUIVALENT COMPONENTS MUST BEAR ALL CHARGES FOR TESTING BY THE GOVERNMENT. BIDDERS OFFERING THE SPECIFIED COMPONENTS ARE EXEMPT FROM SUCH REQUIREMENT. THIS EXEMPTION APPEARS TO BE A REASONABLE PROVISION ESPECIALLY SINCE THE PROPRIETARY COMPONENTS ALREADY HAD UNDERGONE COMPREHENSIVE FIRST ARTICLE AND MOBILITY TESTING SUCCESSFULLY.

WHILE IT MAY BE SAID THAT THE INVITATION DRAWINGS ARE "FWD SHOP DRAWINGS," WE ARE ADVISED THAT TECHNICAL AIR FORCE PERSONNEL HAVE REVIEWED SUCH DRAWINGS, WHICH HAD BEEN PROCURED FROM FWD BY THE AIR FORCE, AND HAVE DETERMINED THAT COMPLIANCE THEREWITH DOES NOT REQUIRE PROCEDURES AND TECHNIQUES OTHER THAN THOSE WHICH ARE NORMAL WITHIN THE INDUSTRY. ALSO, THESE TECHNICAL PERSONNEL ADVISED THAT THE DRAWINGS WERE ADEQUATE FOR FORMAL ADVERTISING PURPOSES; THAT IT IS NORMAL PRACTICE TO FURNISH LARGE DRAWINGS IN SECTIONS; AND THAT SINCE IT WAS RECOGNIZED IN THE INVITATION THAT DISCREPANCIES MIGHT EXIST IN THE DRAWING PACKAGE, IT WAS INCUMBENT UPON YOU TO REQUEST REPLACEMENT OR CLARIFICATION OF MISSING OR DEFECTIVE DRAWINGS. THIS YOU HAVE NOT DONE EVEN, THOUGH, THE DRAWING PACKAGE HAS BEEN IN YOUR POSSESSION SINCE MARCH 1964. IN THAT CONNECTION, THE AIR FORCE REPORTS THAT, WHILE INDIVIDUAL TOTAL DATA PACKAGES WERE NOT PURGED TO REMOVE ILLEGIBLE COPIES, DUPLICATE, LEGIBLE COPIES WERE INCLUDED IN EACH INVITATION SET.

THE GOVERNMENT HAS UNLIMITED RIGHTS OF USE TO THE DATE FURNISHED WITH THE INVITATION. HOWEVER, THE PATENT INDEMNITY PROVISION (PREDETERMINED) WAS INCLUDED BECAUSE FWD IS CURRENTLY NEGOTIATING WITH SEVERAL MUNICIPALITIES FOR THE SALE OF THESE FIRE FIGHTING TRUCKS. SEE ARMED SERVICES PROCUREMENT REGULATIONS 9-103.1 AND 9-103.

YOU POINT OUT THAT ITEM 5 OF THE INVITATION REQUIRES BIDDERS TO ACCOMPLISH VALIDATION AND VERIFICATION OF OPERATIONS AND MAINTENANCE INSTRUCTIONS IF BIDDING AS NEW PRODUCERS BUT THAT FWD WOULD NOT BE REQUIRED TO ACCOMPLISH SUCH VALIDATION AND VERIFICATION. SINCE THE P 2 FIRE FIGHTING TRUCKS ARE CURRENTLY IN PRODUCTION OF FWD, ITS PRESENT CONTRACT INCLUDES A REQUIREMENT FOR VALIDATION AND VERIFICATION. IN VIEW THEREOF, IT WOULD NOT BE LOGICAL TO REQUIRE THAT FWD DUPLICATE ITS PRESENT EFFORT IN THE EVENT IT IS AWARDED THIS NEW PROCUREMENT.

THE DEVELOPMENT OF SPECIFICATIONS TO MEET THE NEEDS OF THE GOVERNMENT IS OBVIOUSLY A FUNCTION PRIMARILY OF THE ADMINISTRATIVE AGENCY CONCERNED. COMP. GEN. 554. HOWEVER, WE HAVE CONSISTENTLY TAKEN THE POSITION THAT ADVERTISED SPECIFICATIONS SHOULD BE STATED IN SUCH TERMS AS TO PERMIT THE BROADEST FIELD OF COMPETITION CONSISTENT WITH THE NEEDS OF THE AGENCY. COMP. GEN. 384. IT MUST BE RECOGNIZED THAT IN THE ORDINARY SITUATION THE PROCUREMENT OF SUPPLIES AND EQUIPMENT IS MERELY A TOOL FOR THE ACCOMPLISHMENT OF THE DUTIES AND RESPONSIBILITIES WITH WHICH THE AGENCIES OF THE GOVERNMENT ARE CHARGED. WHILE CONSISTENT WITH THE PRINCIPLES STATED ABOVE AN AGENCY SHOULD, IN OUR VIEW, BE ALERT TO NEW DEVELOPMENTS AND NEW PRODUCTS WHICH WILL PERMIT THE CARRYING OUT OF THEIR FUNCTIONS MORE EFFICIENTLY OR ECONOMICALLY, THE PRIMARY OBJECTIVE OF ITS SPECIFICATIONS MUST BE TO MEET ITS ACTUAL NEEDS RATHER THAN TO INCREASE COMPETITION FOR THE FILLING OF THEM. 36 COMP. GEN. 610. THE DEPARTMENT OF THE AIR FORCE, WHICH IS PRIMARILY CONCERNED WITH ITS TACTICAL AND STRATEGIC MISSIONS, IS, AS A PRACTICAL PROPOSITION, LIMITED AS TO FUNDS AND TIME FOR THE TESTING OF NEW PRODUCTS WHICH MAY CONTRIBUTE TO A GREATER OR LESSER DEGREE TO THE ACHIEVEMENT OF ITS MISSIONS, AND WE MUST ACCEPT ITS DETERMINATIONS AS TO THE TYPES OF EQUIPMENT BEST SUITED TO ITS NEEDS IN THE ABSENCE OF CLEAR INDICATION THAT SUCH DETERMINATIONS ARE ARBITRARY OR CAPRICIOUS.

IT WOULD APPEAR THAT A READVERTISEMENT UNDER REVISED "OPEN" DESCRIPTIONS AND SPECIFICATIONS WOULD NOT BETTER YOUR COMPETITIVE POSITION SINCE YOU WOULD THEN BE REQUIRED TO DESIGN A TOTALLY NEW AND UNPROVEN VEHICLE SUBJECT TO COSTLY AND TIME-CONSUMING FIRST-ARTICLE AND MOBILITY TESTING. IN THIS CONNECTION, SEE DOD INSTRUCTION 3224.2 DATED JUNE 17, 1963, ENTITLED "DOD STANDARD PREPRODUCTION BASIC TEST AND EVALUATION OF FIREFIGHTING VEHICLES," WHICH REQUIRES SUCH TESTING AS PREREQUISITE TO ANY QUANTITY PROCUREMENT OF ANY NEW OR MODIFIED FIRE FIGHTING TRUCK.

IN VIEW OF THE FOREGOING, AND SINCE A SUBSTANTIAL NUMBER OF THE PARTS AND COMPONENTS MAY BE PURCHASED FROM SOURCES OTHER THAN FWD OR MANUFACTURED INDEPENDENTLY, WE FIND NO SUBSTANTIAL GROUNDS TO QUESTION AN OTHERWISE PROPER AWARD UNDER THIS INVITATION. IN ARRIVING AT THIS CONCLUSION, WE RECOGNIZE THAT THE COMPLEX FUNCTIONAL REQUIREMENTS FOR VEHICLES OF THIS TYPE REQUIRE MAXIMUM ADHERENCE TO PROVED COMPONENTS AND ASSEMBLIES AND UNIFORM CONFIGURATION IN THE BEST INTEREST OF THE GOVERNMENT FROM USE, MAINTENANCE, LOGISTIC SUPPORT, AND PRODUCTION STANDPOINTS.