B-154392, AUG. 13, 1964

B-154392: Aug 13, 1964

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INC.: REFERENCE IS MADE TO YOUR LETTERS OF JUNE 4 AND 10. THE PROCUREMENT ITEMS WERE IN TWO GROUPS. AS FOLLOWS: "/5) EVALUATION OF PROPOSALS: PROPOSALS SUBMITTED AS A RESULT OF THIS REQUEST FOR PROPOSALS WILL BE EVALUATED IN ACCORDANCE WITH THE REGULATIONS PERTAINING TO NEGOTIATED PROCUREMENTS. ANY CONTRACT/S) RESULTING FROM THIS REQUEST FOR PROPOSALS WILL BE AWARDED TO THE OFFEROR WITH WHOM THE LOWEST "AGGREGATE PRICE" IS NEGOTIATED ON EACH OF THE GROUPS OF ITEMS SET FORTH IN EXHIBIT "A.'. THE "AGGREGATE PRICE" OF EACH GROUP WILL BE COMPUTED BY MULTIPLYING THE NUMBER OF UNITS OF EACH ITEM ESTIMATED AT TIME OF AWARD AS THE MAXIMUM QUANTITY OF EACH ITEM TO BE INPUT DURING THE CONTRACT PERIOD.

B-154392, AUG. 13, 1964

TO MANEY AIRCRAFT PARTS, INC.:

REFERENCE IS MADE TO YOUR LETTERS OF JUNE 4 AND 10, 1964, PROTESTING A SPLIT AWARD UNDER REQUEST FOR PROPOSALS (RFP) NO. SA-4 56123-1, ISSUED FEBRUARY 13, 1964, BY THE SAN ANTONIO AIR MATERIAL AREA (SAAMA).

THE RFP IN QUESTION SOLICITED PROPOSALS FOR FURNISHING ALL PLANT, LABOR AND EQUIPMENT NECESSARY TO PERFORM OVERHAUL AND MODIFICATION SERVICES ON GOVERNMENT-FURNISHED EQUIPMENT ON A WORK ORDER BASIS FOR A PERIOD OF ONE YEAR AFTER AWARD. THE PROCUREMENT ITEMS WERE IN TWO GROUPS--- GROUP I, CONSISTING OF ITEMS 1 THROUGH 15, AND GROUP II, CONSISTING OF ITEMS 16 THROUGH 42.

PARAGRAPH 1 (A) OF THE TERMS AND CONDITIONS OF REQUEST FOR PROPOSALS PROVIDED AS FOLLOWS:

"1. ACCEPTANCE--- (A) THE GOVERNMENT MAY ACCEPT ANY ITEM OR GROUP OF ITEMS OF ANY PROPOSAL UNLESS QUALIFIED BY SPECIFIC LIMITATION OF THE OFFEROR.'

PARAGRAPH 15, PAGE 1E, REQUEST FOR PROPOSAL SCHEDULE, PROVIDED, IN PERTINENT PART, AS FOLLOWS:

"/5) EVALUATION OF PROPOSALS:

PROPOSALS SUBMITTED AS A RESULT OF THIS REQUEST FOR PROPOSALS WILL BE EVALUATED IN ACCORDANCE WITH THE REGULATIONS PERTAINING TO NEGOTIATED PROCUREMENTS. AWARD OF CONTRACT/S) SHALL BE IN ACCORDANCE WITH PARAGRAPH 1 OF THE TERMS AND CONDITIONS ON REVERSE OF THE COVER PAGE AND AS FURTHER SPECIFICALLY PROVIDED HEREIN. ANY CONTRACT/S) RESULTING FROM THIS REQUEST FOR PROPOSALS WILL BE AWARDED TO THE OFFEROR WITH WHOM THE LOWEST "AGGREGATE PRICE" IS NEGOTIATED ON EACH OF THE GROUPS OF ITEMS SET FORTH IN EXHIBIT "A.' FOR THE PURPOSES OF EVALUATION, THE "AGGREGATE PRICE" OF EACH GROUP WILL BE COMPUTED BY MULTIPLYING THE NUMBER OF UNITS OF EACH ITEM ESTIMATED AT TIME OF AWARD AS THE MAXIMUM QUANTITY OF EACH ITEM TO BE INPUT DURING THE CONTRACT PERIOD, TIMES THE UNIT PRICE SET OPPOSITE THE INCREMENTAL QUANTITY WHICH WOULD APPLY IF SUCH MAXIMUM QUANTITY WERE INPUT UNDER ANY ONE (1) ORDER, AND THEREAFTER ADDING TO THE SUM TOTAL OF ALL THE ITEMS WITHIN A GROUP THE COSTS OF TRANSPORTATION.'

IT IS REPORTED THAT EVALUATION AFTER OPENING OF THE RFP INDICATED THAT YOU WERE THE APPARENT LOW OFFEROR ON BOTH GROUPS OF ITEMS. ACCORDINGLY, ON APRIL 7, 1964, THE SAAMA REQUESTED A FACILITY CAPABILITY REPORT (FCR) ON YOU FROM THE ATLANTA CONTRACT MANAGEMENT DISTRICT (CMD). THE FCR, WHICH WAS RECEIVED ON APRIL 28, 1964, WAS NEGATIVE. HOWEVER, ON MAY 15, 1964, AFTER MEETING WITH THE ATLANTA SMALL BUSINESS ADMINISTRATION (SBA), THE CMD ADVISED SAAMA THAT THE FCR WAS BEING CHANGED TO AFFIRMATIVE AND RECOMMENDED THAT AWARD BE MADE TO YOU.

IT IS ALSO REPORTED THAT DURING NEGOTIATIONS WITH YOU ON APRIL 6, 1964, YOU HAD BEEN ADVISED OF THE CANCELLATION OF ITEMS 29, 32 AND 33 (ALL IN GROUP II), BECAUSE OF SPECIALIZED TEST EQUIPMENT REQUIREMENTS, AND HAD MADE NO PROTEST THERETO AND THAT ON MAY 20, 1964, THE DIRECTORATE OF MATERIAL MANAGEMENT FIRST DISCLOSED THAT ITEMS 8 AND 31 LIKEWISE REQUIRED SPECIALIZED TEST EQUIPMENT AND DIRECTED THEIR CANCELLATION.

IN CONNECTION WITH ITEM 8, IT IS REPORTED THAT THE TESTING EQUIPMENT, WHICH COSTS $55,000, IS POSSESSED ONLY BY THE ORIGINAL MANUFACTURER AND IS NOT AVAILABLE AS GOVERNMENT-FURNISHED EQUIPMENT (GFE), A DECISION HAVING BEEN MADE PRIOR TO REQUESTING PROPOSALS THAT NO GFE WAS TO BE FURNISHED. ALSO, HAD SUCH REQUIREMENT FOR ITEM 8 BEEN MADE KNOWN TO THE ATLANTA CMD WHILE THE FCR ON YOU WAS IN PROGRESS, THE FCR UNDOUBTEDLY WOULD HAVE BEEN NEGATIVE, AT LEAST FOR ITEM 8, ON THE BASIS THAT THE TEST EQUIPMENT WAS NOT AVAILABLE TO YOU.

INCIDENT TO THE SECOND CANCELLATION, ALL GROUP I OFFERS WERE REDUCED BY THE AMOUNTS QUOTED ON ITEM 8 WITH THE RESULT THAT YOUR LOW OFFER OF $41,762, WHICH DROPPED TO $37,582, WAS DISPLACED BY THE OFFER OF BUSINESS AIRCRAFT CORPORATION, WHICH DROPPED FROM $45,197, TO $35,019.80. ACCORDINGLY, ON MAY 29, 1964, GROUP I WAS AWARDED TO BUSINESS AIRCRAFT, AND GROUP II WAS AWARDED TO YOU.

YOU QUESTION THE VALIDITY OF THE GROUP I AWARD, WHICH, YOU STATE, HINGES ON THE ACCURACY OF THE ITEM 8 CANCELLATION. YOU JUSTIFY YOUR PROTEST ON THE BASIS THAT AT NO TIME PRIOR TO MAY 29, 1964, DID YOU HAVE ANY INDICATION THAT YOU WERE BEING CONSIDERED FOR AWARD OF ANYTHING OTHER THAN THE ENTIRE PROCUREMENT AND THAT IN ANTICIPATION THEREOF YOU INCURRED PREPARATORY EXPENSES IN EXCESS OF $3,500 THEREBY PLACING YOURSELF IN A DEFICIT POSITION SINCE YOUR ANTICIPATED PROFIT ON THE GROUP II ITEMS WILL NOT EXCEED $2,500. IN THIS CONNECTION, HOWEVER, THE CONTRACTING OFFICER REPORTS THAT AT NO TIME WAS IT INDICATED TO YOU THAT YOU WOULD BE AWARDED ALL OR ANY PART OF THE PROCUREMENT AND AT NO TIME WERE YOU ORDERED OR REQUESTED TO EXPEND FUNDS, OVER AND ABOVE YOUR NORMAL PROPOSAL PREPARATION COST, IN ORDER TO QUALIFY YOUR PROPOSAL.

THE LANGUAGE QUOTED ABOVE FROM THE TERMS AND CONDITIONS OF THE RFP PROPER AND THE RFP SCHEDULE, RESERVING TO THE GOVERNMENT THE RIGHT TO ACCEPT ANY OR ALL OF THE ITEMS OF ANY PROPOSAL IN THE ABSENCE OF A SPECIFIC LIMITATION BY THE OFFEROR, CONSTITUTED NOTICE TO ALL OFFERORS THAT AWARD MIGHT BE MADE FOR LESS THAN ALL OF THE ITEMS LISTED IN THE PROCUREMENT. THEREFORE, THE FACT THAT YOU MAY NOT HAVE BEEN AWARE OF THE ELIMINATION OF ONE OR MORE OF THE DELETED ITEMS UNTIL AWARD--- A MATTER WHICH IS IN DISPUTE AT LEAST AS TO THE THREE ITEMS ABOUT WHICH YOU WERE REPORTEDLY ADVISED ON APRIL 6, 1964--- DID NOT PRECLUDE THE EXERCISE BY THE GOVERNMENT OF ITS RIGHT TO CANCEL THE ITEMS. ACCORDINGLY, THERE IS NO BASIS TO CONCLUDE THAT THE CANCELLATION OF ITEM 8 FROM GROUP 1 WAS IMPROPER.

AS TO THE EXPENDITURES WHICH YOU ALLEGEDLY MADE IN CONTEMPLATION OF AWARD OF THE ENTIRE PROCUREMENT, ANY SUCH EXPENSES WERE CLEARLY AT YOUR SOLE RISK, SINCE UNDER THE EXPRESS PROVISIONS OF PART VIII OF THE RFP SCHEDULE THERE WAS NO ASSURANCE THAT THE ACTUAL VOLUME OF WORK TO BE PLACED UNDER THE CONTRACT WOULD EXCEED THE SPECIFIED MINIMUM AMOUNTS OF $1740 UNDER GROUP I AND $1260 UNDER GROUP II. FURTHERMORE, THE STATUTES WHICH GOVERN THE ADVERTISING AND AWARD OF PUBLIC CONTRACTS WERE ENACTED SOLELY FOR THE BENEFIT AND PROTECTION OF THE GOVERNMENT AND NO BIDDER ACQUIRES ENFORCEABLE RIGHTS UNTIL THE VALID ACCEPTANCE OF HIS OFFER BY A PROPERLY AUTHORIZED REPRESENTATIVE OF THE GOVERNMENT. SEE PERKINS V. LUKENS STEEL CO., 310 U.S. 113; FRIEND V. LEE, 221 F.2D 96; O-BRIEN V. CARNEY, 6 F.SUPP. 761.

IN THE CIRCUMSTANCES, AND IN VIEW OF THE CONTRACTING OFFICER'S STATEMENT THAT AT NO TIME WERE YOU REQUESTED TO INCUR ANY EXTRAORDINARY EXPENSES IN ORDER TO QUALIFY YOUR PROPOSAL, THERE IS NO LEGAL BASIS FOR OBJECTING TO THE ACTION TAKEN BY THE ADMINISTRATIVE AGENCY. WE THEREFORE CONCLUDE THAT THE AWARD OF GROUP I TO BUSINESS AIRCRAFT WAS PROPER, AND YOUR PROTEST IS DENIED.