B-156618, MAY 20, 1965

B-156618: May 20, 1965

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INCLUDED THEREWITH WERE COPIES OF YOUR CORRESPONDENCE PROTESTING THE SUBJECT AWARD. BIDS WERE REQUESTED FOR MISCELLANEOUS ITEMS OF EQUIPMENT AND INSTRUCTION INCLUDING THE FURNISHING OF 40 COMPLETE SETS OF PROGRAM MATERIAL. BIDS WERE ALSO REQUESTED ON SPECIFIED INCREMENTAL QUANTITIES OF EQUIPMENT SYSTEMS. BIDDERS WERE REQUIRED TO GIVE THE GOVERNMENT AN OPTION TO PURCHASE ADDITIONAL QUANTITIES (FROM 41 - 125) OF PROGRAM MATERIAL AND EQUIPMENT SYSTEMS AT UNIT PRICES SPECIFIED BY THE BIDDER. EDUCATING AND LEAR SIEGLER WERE NONRESPONSIVE FOR FAILURE TO QUOTE A FIRM DELIVERY SCHEDULE FOR THE OPTIONAL QUANTITIES. WAS UNREASONABLY HIGH IN PRICE. FUNDS AVAILABLE FOR THIS PROCUREMENT WERE $248. "D. CERTAIN PROVISIONS IN THE SPECIFICATION WERE AMBIGUOUS AND REQUIRED CLARIFICATION.'.

B-156618, MAY 20, 1965

TO EDUCATING SYSTEMS, INCORPORATED:

ON APRIL 21, 1965, THE DEPUTY FOR PROCUREMENT MANAGEMENT, DEPARTMENT OF THE AIR FORCE, SUBMITTED FOR OUR CONSIDERATION AND DECISION THE ADMINISTRATIVE FILE IN CONNECTION WITH THE AWARD OF A CONTRACT TO THE EDEX CORPORATION UNDER INVITATION FOR BIDS NO. 04-607-65-127, DATED MARCH 15, 1965. INCLUDED THEREWITH WERE COPIES OF YOUR CORRESPONDENCE PROTESTING THE SUBJECT AWARD.

THE RECORD SHOWS THAT PRIOR TO ISSUANCE OF THE ABOVE IFB, THE PROCURING ACTIVITY (SAN BERNARDINO AIR MATERIEL AREA, UNITED STATES AIR FORCE, NORTON AIR FORCE BASE, CALIFORNIA) ISSUED IFB NO. 04-607-65 116, DATED FEBRUARY 26, 1965, AS THE SECOND STEP OF A TWO-STEP FORMALLY ADVERTISED PROCUREMENT. UNDER THIS INVITATION, BIDS WERE REQUESTED FOR MISCELLANEOUS ITEMS OF EQUIPMENT AND INSTRUCTION INCLUDING THE FURNISHING OF 40 COMPLETE SETS OF PROGRAM MATERIAL. BIDS WERE ALSO REQUESTED ON SPECIFIED INCREMENTAL QUANTITIES OF EQUIPMENT SYSTEMS, UP TO 40, THE GOVERNMENT UNILATERALLY RETAINING THE OPTION TO PURCHASE AS MANY SYSTEMS AS IT DESIRED. IN ADDITION, BIDDERS WERE REQUIRED TO GIVE THE GOVERNMENT AN OPTION TO PURCHASE ADDITIONAL QUANTITIES (FROM 41 - 125) OF PROGRAM MATERIAL AND EQUIPMENT SYSTEMS AT UNIT PRICES SPECIFIED BY THE BIDDER. THE FILE REVEALS THE FOLLOWING REASONS FOR SUBSEQUENTLY CANCELLING THE AFOREMENTIONED INVITATION:

"A. THE BIDS OF EVANS, EDUCATING AND LEAR SIEGLER WERE NONRESPONSIVE FOR FAILURE TO QUOTE A FIRM DELIVERY SCHEDULE FOR THE OPTIONAL QUANTITIES.

"B. THE BID OF EDEX, ALTHOUGH RESPONSIVE, WAS UNREASONABLY HIGH IN PRICE.

"C. THE REQUIREMENTS AS TO NUMBER OF PROGRAMS AND EQUIPMENT SYSTEMS TO BE INITIALLY PURCHASED HAD BEEN CHANGED, DUE TO LACK OF SUFFICIENT FUNDS TO PURCHASE THE MINIMUM QUANTITY OF 40 UNITS. FUNDS AVAILABLE FOR THIS PROCUREMENT WERE $248,000. THIS PROVED INSUFFICIENT TO PURCHASE THE MINIMUM QUANTITY OF 40 UNITS FROM ANY BIDDER.

"D. CERTAIN PROVISIONS IN THE SPECIFICATION WERE AMBIGUOUS AND REQUIRED CLARIFICATION.'

FOLLOWING CANCELLATION, THE PROCURING ACTIVITY ISSUED A REVISED INVITATION, NO. 04-607-65-127, WHICH REQUESTED BIDS ON ONE COMPLETE SET OF PROGRAM MATERIAL, ONE COMPLETE SET OF EQUIPMENT, ONE PRINTER (I.E., STUDENT SCORING RECORDER), ONE RECORDING PROGRAMMER MACHINE AND INSTRUCTOR TRAINING FOR ONE GROUP OF STUDENTS. OPTIONS FOR ADDITIONAL MATERIALS AND EQUIPMENT WERE ALSO REQUIRED. EDEX CORPORATION HAVING SUBMITTED THE LOWEST BID WAS AWARDED A CONTRACT FOR THE DESIRED ITEMS ON MARCH 25, 1965.

IT IS YOUR CONTENTION THAT THE SPECIFICATIONS UNDULY FAVORED THE SUCCESSFUL BIDDER'S EQUIPMENT. IN RESPONSE TO THIS ALLEGATION, THE ADMINISTRATIVE OFFICE STATES:

"THE BIDS WERE NOT WRITTEN AROUND THE POTENTIAL OF ANY PARTICULAR MANUFACTURER. WHEN ISSUED IT WAS NOT KNOWN HOW MANY FIRMS MANUFACTURED THE DESIRED EQUIPMENT NOR WHAT THEIR MAXIMUM POTENTIAL WAS. IT IS ASSUMED THAT BY "MAXIMUM POTENTIAL," MR. GRANIK IS REFERRING TO THE FACT THAT THE BID WAS BASED UPON A CLASSROOM OF FORTY STUDENTS. BIDS ON THIS PROCUREMENT WERE BASED UPON THE BIDDER'S OWN TECHNICAL PROPOSALS NO. 1002- LP-65-157, IN WHICH IT IS SET FORTH THAT EACH CLASSROOM SYSTEM MUST BE CAPABLE OF INDIVIDUALLY HANDLING UP TO FORTY STUDENTS. THE FIGURE OF FORTY STUDENTS WAS INCLUDED IN THE REQUEST FOR TECHNICAL PROPOSALS AT THE REQUEST OF THE INITIATOR. BECAUSE OF LIMITATIONS OF CLASSROOM SPACE, THE IMPRACTICALITY OF RELIEVING MORE THAN FORTY AIRMEN FROM DUTY AT ONE TIME AT REMOTE AND ISOLATED STATIONS, THE PROBLEM OF PORTABILITY BETWEEN AIR FORCE BASES, AND THE FACT THAT LEARNING RETENTION DIMINISHES SHARPLY AFTER THE CLASS EXCEEDS MORE THAN 30 - 40 PUPILS, THE INITIATOR SELECTED FORTY STUDENTS AS THE MAXIMUM TO BE TRAINED AT ONE TIME.'

IT SHOULD ALSO BE NOTED THAT IF YOUR SUGGESTION WERE ACCEPTED AND THE SPECIFICATIONS REVISED TO REQUIRE A SYSTEM CAPABLE OF HANDLING 100 STUDENTS, ALL BIDDERS OTHER THAN YOUR FIRM WOULD BE REQUIRED TO MODIFY THEIR EQUIPMENT. UNDOUBTEDLY THIS WOULD RESULT IN HIGHER BIDS. IT IS THE OFFICIAL AIR FORCE POSITION THAT A SYSTEM OF THIS SIZE IS NOT ONLY UNNECESSARY BUT WOULD BE LESS PORTABLE THAN THE SMALLER REQUIRED SYSTEM.

SINCE THE MINIMUM QUANTITY OF 40 SETS OF PROGRAM AND ALLIED MATERIALS SPECIFIED IN ITEM NO. 1 IN THE INITIAL INVITATION TOGETHER WITH THE MINIMUM RELATED EQUIPMENT FOR THE EFFICIENT USE OF THAT QUANTITY OF MATERIAL WOULD HAVE, UNDER ANY OF THE BIDS RECEIVED THEREON, COST MORE THAN THE FUNDS AVAILABLE, WE FIND NO BASIS FOR QUESTIONING THE PROPRIETY OF THE CANCELLATION. IT CERTAINLY CANNOT BE CONTENDED THAT AN AGENCY MAY OBLIGATE THE GOVERNMENT TO PAY OUT UNDER CONTRACT MORE THAN THE FUNDS AVAILABLE FOR THE PURPOSE; NOR DO WE THINK IT REASONABLE IN LIGHT OF THE FORM OF ITEM NO. 1 OF THE ORIGINAL INVITATION TO CONTEND THAT THE GOVERNMENT COULD HAVE INSISTED UPON AN AWARD OF LESS THAN 40 SETS AT A PRORATED PRICE, OR THAT THE GOVERNMENT SHOULD HAVE PURCHASED A SIGNIFICANTLY UNBALANCED COMBINATION OF MATERIALS AND EQUIPMENT TO REMAIN WITHIN THE FUNDS AVAILABLE. WHILE WE VIEW CANCELLATION OF AN INVITATION AFTER OPENING AS A SERIOUS MATTER, WHERE, AS HERE, THE FACTS SUPPORT SUCH COURSE OF ACTION, WE WOULD NOT BE JUSTIFIED IN OBJECTING TO THE ADMINISTRATIVE ACTION TAKEN.

IN YOUR LETTER DATED MARCH 27, 1965, ADDRESSED TO COLONEL A. J. DREISESZUN, DIRECTOR OF PROCUREMENT AND PRODUCTION, AIR MATERIEL COMMAND, YOU SUGGEST CANCELLATION OF THE AWARD ON THE GROUND THAT THE SPECIFICATIONS SHOULD HAVE REQUIRED ALL FILM TO BE IN COLOR EXCEPT IN THOSE SITUATIONS WHERE THE ADDED SPEED AND LATITUDE OF BLACK AND WHITE FILM IS REQUIRED. ALTHOUGH THE AIR FORCE INDICATES THAT IN SOME SITUATIONS COLOR FILM MAY BE DESIRABLE THE REPORT STATES THAT THE ADDITIONAL BENEFITS WOULD NOT BE COMMENSURATE WITH THE ADDED COSTS. THE DRAFTING OF SPECIFICATIONS TO SATISFY THE GOVERNMENT'S NEEDS IS PRIMARILY THE FUNCTION OF THE ADMINISTRATIVE AGENCY AND WE FIND NO BASIS TO QUESTION THE DETERMINATION IN THIS CASE. SEE 17 COMP. GEN. 554.

IN ACCORDANCE WITH THE FOREGOING WE FIND NO BASIS TO QUESTION THE LEGALITY OF THE AWARD.