B-154621, NOV. 20, 1964

B-154621: Nov 20, 1964

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TO PERJECO JEEP AND PARTS COMPANY: REFERENCE IS MADE TO YOUR TELEGRAM DATED JULY 1. THE SUBSTANCE OF YOUR PROTEST APPEARS TO BE THAT (1) AN EXCESSIVE PRICE WAS PAID FOR THE MATERIAL INVOLVED AND (2) YOUR OFFER WAS NOT PROPERLY EVALUATED AND HANDLED IN A MANNER TO THE BEST INTEREST OF THE GOVERNMENT. THE ITEM WAS IN AN "URGENT OUT OF STOCK STATUS" AND ENGINEERING SUPPORT REPORTED THAT IT HAD NO DRAWING SUPPORT FOR THIS NONCOMMERCIAL ITEM AND ATTEMPTS TO OBTAIN DRAWINGS FROM THE MANUFACTURER WERE UNSUCCESSFUL. THE MATTER WAS REFERRED TO APPROPRIATE AUTHORITY WHO EXECUTED A DETERMINATION AND FINDINGS AUTHORIZING PROCUREMENT OF THE ITEM BY NEGOTIATION PURSUANT TO ASPR 3 210.2/XIII). THE CARTER CARBURETOR COMPANY WAS REQUESTED TO SUBMIT A PROPOSAL.

B-154621, NOV. 20, 1964

TO PERJECO JEEP AND PARTS COMPANY:

REFERENCE IS MADE TO YOUR TELEGRAM DATED JULY 1, 1964, YOUR LETTER OF SEPTEMBER 29, 1964, WITH ENCLOSURES, AND OTHER CORRESPONDENCE, PROTESTING AN AWARD MADE TO THE CARTER CARBURETOR COMPANY UNDER REQUEST FOR PROPOSAL NO. EH-4-A1481 ISSUED BY THE ST. LOUIS PROCUREMENT DISTRICT. IN BRIEF, THE SUBSTANCE OF YOUR PROTEST APPEARS TO BE THAT (1) AN EXCESSIVE PRICE WAS PAID FOR THE MATERIAL INVOLVED AND (2) YOUR OFFER WAS NOT PROPERLY EVALUATED AND HANDLED IN A MANNER TO THE BEST INTEREST OF THE GOVERNMENT.

IT APPEARS FROM THE RECORD THAT REQUEST FOR PROPOSAL NO. EH-4-A1481 ORIGINATED AS A REQUISITION BY THE SUPPLY DIRECTORATE, ATAC FOR 6618 CARBURETOR REPAIR KITS, MFG. P/N1319B, FOR USE ON G503, TRUCK 1.4 TON 4 TIMES 4, TO SUPPLY MPA DEMANDS. THE ITEM WAS IN AN "URGENT OUT OF STOCK STATUS" AND ENGINEERING SUPPORT REPORTED THAT IT HAD NO DRAWING SUPPORT FOR THIS NONCOMMERCIAL ITEM AND ATTEMPTS TO OBTAIN DRAWINGS FROM THE MANUFACTURER WERE UNSUCCESSFUL. BASED ON THIS LATTER PREMISE, ATAC PURCHASE ASSIGNMENT BOARD RECOMMENDED THAT THE PROCUREMENT BE ALLOCATED TO THE ST. LOUIS PROCUREMENT DISTRICT FOR NEGOTIATION WITH CARTER CARBURETOR DIVISION, A.C.F., THE UNIT MANUFACTURER AND ONLY KNOWN APPROVED SOURCE. THE MATTER WAS REFERRED TO APPROPRIATE AUTHORITY WHO EXECUTED A DETERMINATION AND FINDINGS AUTHORIZING PROCUREMENT OF THE ITEM BY NEGOTIATION PURSUANT TO ASPR 3 210.2/XIII). THE CARTER CARBURETOR COMPANY WAS REQUESTED TO SUBMIT A PROPOSAL, AND AS A RESULT OF THE PUBLICATION IN THE COMMERCE BUSINESS DAILY OF A SYNOPSIS OF THE PROCUREMENT, YOU REQUESTED COPIES OF THE NECESSARY PROPOSAL FORMS. YOU OFFERED TO SUPPLY THE ITEM AT A COST OF $3.68 EACH OR $24,354.24 IN THE AGGREGATE AS OPPOSED TO THE OFFER OF CARTER AT $4,146 EACH TOTALING $27,438.23. IN VIEW OF YOUR LOW BID THE PROCURING OFFICE REQUESTED ATAC, THE REQUISITIONING OFFICE, TO DETERMINE THE ACCEPTABILITY OF YOUR KIT. ATAC ADVISED THAT ALTHOUGH THE COMPONENTS LIST OF THE PERJECO KIT IS IDENTICAL WITH THE APPROVED SOURCE (CARTER) LIST, THE PERJECO KIT WAS NOT ACCEPTABLE SINCE, IN THE ABSENCE OF DRAWINGS, AN "OR EQUAL" EVALUATION COULD NOT BE MADE AND NO OTHER BUT THE APPROVED PART COULD BE ACCEPTED. REVERSE ENGINEERING AND EVALUATION BY ACTUAL ROAD TEST (20,000 MILES AT A GOVERNMENT PROVING GROUND) WERE DISCARDED AS TOO EXPENSIVE AND TIME-CONSUMING, HAVING IN MIND THE URGENCY OF THE PROCUREMENT. ON JUNE 29, 1964, THE PROPOSAL OF THE CARTER CARBURETOR COMPANY WAS ACCEPTED AND A NEGOTIATED FIXED-PRICE CONTRACT EXECUTED. WE ARE ADVISED INFORMALLY THAT DELIVERIES UNDER THE CONTRACT WERE DUE FOR COMPLETION BY THE END OF OCTOBER 1964.

IN YOUR LETTER OF SEPTEMBER 29, 1964, YOU STATE THAT "IF ST. LOUIS PROCUREMENT DISTRICT WERE TO PURCHASE THESE(KITS) ON A NEGOTIABLE BASIS WITH CARTER CARBURETOR CORPORATION THEY WOULD HAVE NEVER SENT ME A BID FORM WHICH I REQUESTED AFTER SEEING THEIR REQUEST FOR PROPOSAL IN THE COMMERCE BUSINESS DAILY OF MARCH 10, 1964, ISSUE PSA-3506.' YOU ALSO CALL ATTENTION TO THE ENCLOSURES WITH THIS LETTER, WHEREIN IT IS INDICATED THAT IN NOVEMBER 1952 YOU FURNISHED THE LETTERKENNY ORDNANCE DEPOT WITH 1,000 OF THE SAME NUMBERED KITS; THAT A SAMPLE HAD BEEN SUPPLIED FOR APPROVAL TO THE DEPOT AND HAD BEEN FOUND ACCEPTABLE; AND THAT OTHER KITS HAD BEEN SUPPLIED THE DEPARTMENT OF THE ARMY AND APPROVED.

IT MUST BE NOTED THAT THIS REQUEST FOR PROPOSAL WAS ISSUED PURSUANT TO AUTHORITY CONTAINED IN ARMED SERVICES PROCUREMENT REGULATION 3 210.2/XIII) WHICH PERMITS PROCUREMENT BY NEGOTIATION WHEN IT IS IMPOSSIBLE TO DRAFT, FOR A SOLICITATION OF BIDS, ADEQUATE SPECIFICATIONS OR ANY OTHER ADEQUATELY DETAILED DESCRIPTION OF THE REQUIRED SUPPLIES OR SERVICES. GENERAL POLICIES CONCERNING THE PROCUREMENT OF PARTS ARE STATED IN PARAGRAPH 1-313 OF THE ARMED SERVICES PROCUREMENT REGULATION AS FOLLOWS:

"1-313 PROCUREMENT OF PARTS.

(A) PARTS FOR MILITARY EQUIPMENT, TO BE USED FOR REPLENISHMENT OF STOCK, REPAIR, OR REPLACEMENT, MUST BE PROCURED SO AS TO ASSURE THE REQUISITE SAFE, DEPENDABLE AND EFFECTIVE OPERATION OF THE EQUIPMENT. WHERE IT IS FEASIBLE TO DO SO WITHOUT IMPAIRING THIS ASSURANCE, PARTS SHOULD BE PROCURED ON A COMPETITIVE BASIS, AS IN THE KIND OF CASES DESCRIBED IN (B) BELOW. HOWEVER, WHERE THIS ASSURANCE CAN BE HAD ONLY IF THE PARTS ARE PROCURED FROM THE ORIGINAL MANUFACTURER OF THE EQUIPMENT OR HIS SUPPLIER, THE PROCUREMENT SHOULD BE RESTRICTED ACCORDINGLY, AS IN THE KIND OF CASES DESCRIBED IN (C) BELOW.

"/B) PARTS THAT ARE FULLY IDENTIFIED AND CAN BE OBTAINED FROM A NUMBER OF KNOWN SOURCES, AND PARTS FROM WHICH FULLY ADEQUATE MANUFACTURING DRAWINGS AND ANY OTHER NEEDED DATA ARE AVAILABLE * * * ARE TO BE PROCURED ON A COMPETITIVE BASIS. IN GENERAL, SUCH PARTS ARE OF A STANDARD DESIGN CONFIGURATION. THEY INCLUDE INDIVIDUAL ITEMS THAT ARE SUSCEPTIBLE OF SEPARATE PROCUREMENT, SUCH AS RESISTORS, TRANSFORMERS, GENERATORS, SPARK PLUGS, ELECTRON TUBES, OR OTHER PARTS HAVING COMMERCIAL EQUIVALENTS.

"/C) PARTS NOT WITHIN THE SCOPE OF (B) ABOVE GENERALLY SHOULD BE PROCURED (EITHER DIRECTLY OR INDIRECTLY) ONLY FROM SOURCES THAT HAVE SATISFACTORILY MANUFACTURED OR FURNISHED SUCH PARTS IN THE PAST, UNLESS FULLY ADEQUATE DATA (INCLUDING ANY NECESSARY PROPRIETARY DATA), TEST RESULTS, AND QUALITY ASSURANCE PROCEDURES, ARE AVAILABLE * * * TO ASSURE THE REQUISITE RELIABILITY AND INTERCHANGEABILITY OF THE PARTS, AND PROCUREMENT ON A COMPETITIVE BASIS WOULD BE CONSISTENT WITH THE ASSURANCE DESCRIBED IN (A) ABOVE. IN ASSESSING THIS ASSURANCE, THE NATURE AND FUNCTION OF THE EQUIPMENT FOR WHICH THE PART IS NEEDED SHOULD BE CONSIDERED. ILLUSTRATE, ACCEPTABLE TOLERANCES FOR A COMMERCIAL TELEVISION PART MAY BE FAR LESS STRINGENT THAN THOSE FOR A COMPARABLE MILITARY RADAR PART, PERMITTING COMPETITIVE PROCUREMENT OF THE FORMER BUT NOT OF THE LATTER. THE EXACTING PERFORMANCE REQUIREMENTS OF SPECIALLY DESIGNED MILITARY EQUIPMENT GENERALLY DEMAND THAT PARTS BE CLOSELY CONTROLLED AND HAVE PROVEN CAPABILITIES OF PRECISE INTEGRATION WITH THE SYSTEM IN WHICH THEY OPERATE, TO A DEGREE THAT PRECLUDES THE USE OF EVEN APPARENTLY IDENTICAL PARTS FROM NEW SOURCES, SINCE THE FUNCTIONING OF THE WHOLE MAY DEPEND ON LATENT CHARACTERISTICS OF EACH PART WHICH ARE NOT DEFINITELY KNOWN.'

CAREFUL CONSIDERATION HAS BEEN GIVEN TO THE CONTENTIONS URGED IN SUPPORT OF YOUR PROTEST, BUT WE ARE UNABLE TO CONCLUDE THAT THE ACTION TAKEN BY THE CONTRACTING OFFICIALS WAS UNAUTHORIZED. IN VIEW OF THE "URGENT" STATUS OF THE REQUIREMENT, AND THE FACT THAT THE TIME REQUIRED FOR QUALIFICATION OF YOUR KIT WOULD BE QUITE EXTENSIVE, AND IN VIEW OF THE FURTHER FACT THAT THE METHOD OF NEGOTIATION RESORTS TO WAS WITHIN THE BOUNDS OF AUTHORITY SET FORTH IN THE CITED SECTIONS OF THE ARMED SERVICES PROCUREMENT REGULATION, WE MUST CONCLUDE THAT THERE HAS NOT BEEN A SUFFICIENT BASIS FOR DETERMINING THAT THE PROCUREMENT IN THE INSTANT CASE SHOULD BE REGARDED AS INVALID. WHETHER YOUR CARBURETOR KIT IS OR IS NOT THE EQUAL OF THE CARTER KIT, AND WHETHER THE ENGINEERING EVALUATION OF THE KIT OFFERED BY YOU COULD OR SHOULD HAVE BEEN HANDLED IN A DIFFERENT MANNER INVOLVES TECHNICAL CONSIDERATIONS AS TO WHICH WE ARE NOT QUALIFIED TO FORM AN INDEPENDENT CONCLUSION, BUT MUST RELY LARGELY UPON THE TECHNICAL PERSONNEL OF THE ARMY. IN ANY EVENT, SINCE IT IS OUR INFORMATION THAT THE PARTICULAR PROCUREMENT INVOLVED HAS BEEN VIRTUALLY COMPLETED, ACTION BY OUR OFFICE AT THIS TIME WOULD NOT APPEAR TO BE IN THE BEST INTERESTS OF THE GOVERNMENT.