B-156816, NOV. 23, 1965

B-156816: Nov 23, 1965

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THE REQUEST FOR UNPRICED TECHNICAL PROPOSALS WAS ISSUED ON MAY 27. EACH BID SAMPLE WILL BE SUBJECT TO ADDITIONAL (GOVERNMENT) INSPECTIONS AND TESTS. "THE GOVERNMENT WILL EXERCISE CARE AND DILIGENCE TO PREVENT DAMAGE TO THE SAMPLE AND WILL NOT TEST BEYOND THE CAPABILITIES CLAIMED BY THE OFFEROR IN HIS SUBMITTED TECHNICAL DATA. THE BID SAMPLES WILL BE RETURNED TO THE OFFEROR WITHIN ONE (1) MONTH OF CONTRACT AWARD (OR CANCELLATION) DATE. TO A DESIGNATED LABORATORY WITHIN TEN (10) CALENDAR DAYS OF ANY REQUEST FOR SAME WILL BE ASSUMED NOT TO HAVE AN ADEQUATE PRODUCT FOR THIS PROCUREMENT AND THEIR TECHNICAL PROPOSAL WILL BE REJECTED WITHOUT FURTHER CONSIDERATION.'. INTERESTED FIRMS WERE ALSO ADVISED THAT TECHNICAL PROPOSALS WOULD BE EVALUATED IN ACCORDANCE WITH ESTABLISHED CRITERIA TO DETERMINE THE ACCEPTABILITY OF THE EQUIPMENT OFFERED.

B-156816, NOV. 23, 1965

TO MICROLAB/FXR:

BY LETTER DATED MAY 12, 1965, AS SUPPLEMENTED BY LETTER OF OCTOBER 19, 1965, YOU PROTESTED AGAINST THE PROCEDURES FOLLOWED BY THE BUREAU OF SHIPS, DEPARTMENT OF THE NAVY, IN CONNECTION WITH YOUR TECHNICAL PROPOSAL SUBMITTED UNDER THE FIRST STEP OF A TWO-STEP PROCUREMENT SOLICITED UNDER P.R. 627G1-47555 (Q).

THE REQUEST FOR UNPRICED TECHNICAL PROPOSALS WAS ISSUED ON MAY 27, 1964, FOR A QUANTITY OF R.F. POWER MEASURING SETS, TOGETHER WITH ATTENUATORS, TECHNICAL MANUALS, MAINTENANCE REPAIR PARTS AND INSTRUMENT CALIBRATION PROCEDURES. PURSUANT TO ASPR 2-503.1, THE FIRST-STEP REQUEST FOR TECHNICAL PROPOSALS ADVISED INTERESTED FIRMS OF THE GOVERNMENT'S REQUIREMENTS BY DESCRIPTIVE INFORMATION AND DATA, TEST DATA SUBMISSIONS, WEIGHTED FACTORS TO BE USED IN DETERMINING AN OFFEROR'S TOTAL ENVIRONMENTAL SCORE, AND OF THE GOVERNMENT'S DESIRE FOR PHOTOGRAPHS, SCHEMATIC DRAWING, TECHNICAL MANUAL, AND QUANTITY CONTROL PROCEDURES. EXHIBIT "B" OF THE REQUEST FOR PROPOSALS PROVIDED WITH RESPECT TO BID SAMPLES:

"THE GOVERNMENT MAY, AS A MEANS OF ASSURING THAT THE PRODUCTS OFFERED MEET THE NEEDS AS SPECIFIED IN THE PROCUREMENT DOCUMENTS, REQUEST A BID SAMPLE PRIOR TO DETERMINING THE ACCEPTABILITY OF THE OFFEROR'S TECHNICAL PROPOSAL. EACH BID SAMPLE WILL BE SUBJECT TO ADDITIONAL (GOVERNMENT) INSPECTIONS AND TESTS, BY A DESIGNATED LABORATORY, AS DEEMED NECESSARY TO CONFIRM OR DENY CONFORMANCE WITH THE PROCUREMENT REQUIREMENTS AND OFFERORS CLAIMS. OFFEROR BID SAMPLE MUST MEET DATA REQUIREMENT OF EXHIBITS "C" AND"D.'

"THE GOVERNMENT WILL EXERCISE CARE AND DILIGENCE TO PREVENT DAMAGE TO THE SAMPLE AND WILL NOT TEST BEYOND THE CAPABILITIES CLAIMED BY THE OFFEROR IN HIS SUBMITTED TECHNICAL DATA. THE BID SAMPLES WILL BE RETURNED TO THE OFFEROR WITHIN ONE (1) MONTH OF CONTRACT AWARD (OR CANCELLATION) DATE. CONCERNS FAILING TO FURNISH A REQUESTED BID SAMPLE OF THEIR OWN MANUFACTURER, COMPLETE WITH SCHEMATIC DIAGRAMS, AND A TECHNICAL MANUAL, TO A DESIGNATED LABORATORY WITHIN TEN (10) CALENDAR DAYS OF ANY REQUEST FOR SAME WILL BE ASSUMED NOT TO HAVE AN ADEQUATE PRODUCT FOR THIS PROCUREMENT AND THEIR TECHNICAL PROPOSAL WILL BE REJECTED WITHOUT FURTHER CONSIDERATION.'

INTERESTED FIRMS WERE ALSO ADVISED THAT TECHNICAL PROPOSALS WOULD BE EVALUATED IN ACCORDANCE WITH ESTABLISHED CRITERIA TO DETERMINE THE ACCEPTABILITY OF THE EQUIPMENT OFFERED, AND THAT THE GOVERNMENT RESERVED THE RIGHT TO DISCUSS TECHNICAL ASPECTS OF THE PROPOSALS SUBMITTED. WITH REFERENCE TO TEST DATA, OFFERORS WERE REQUIRED TO SUBMIT DATA ON THEIR EQUIPMENT WHICH WOULD SHOW COMPLIANCE WITH THE TECHNICAL REQUIREMENTS OF EXHIBIT "C" (TEST DATA). A TECHNICAL PROPOSAL THAT DID NOT PROVE FULL COMPLIANCE WITH THE TEST DATA REQUIREMENTS WAS NOT TO BE CONSIDERED AS ACCEPTABLE. ALSO, OFFERORS WERE REQUIRED TO FURNISH TEST DATA TO SHOW COMPLIANCE, OR THE DEGREE THEREOF, OF THEIR EQUIPMENT WITH THE ENVIRONMENTAL TEST REQUIREMENTS SET OUT IN EXHIBIT "C" SINCE COMMERCIAL EQUIPMENT IS NOT ORDINARILY DESIGNED FOR USE UNDER SHIPBOARD ENVIRONMENTAL CONDITIONS.

SINCE YOU HAVE HAD AN OPPORTUNITY TO REVIEW THE ADMINISTRATIVE BASES FOR THE REJECTION OF YOUR TECHNICAL PROPOSAL AS SUBMITTED AND AS SUPPLEMENTED, WE WILL NOT REPEAT HERE THE TECHNICAL REASONS FOR THE REJECTION OF YOUR TECHNICAL PROPOSAL. WE HAVE, HOWEVER, OBTAINED THE ADDITIONAL VIEWS OF THE PROCUREMENT AGENCY ON YOUR LETTER OF OCTOBER 19, 1965, TO US, WHEREIN YOU COMMENTED ON THE PROCUREMENT AGENCY REPORT OF OCTOBER 4, 1965, TO OUR OFFICE ON YOUR PROTEST. IN ORDER THAT YOU MIGHT BE FULLY APPRISED OF THE AGENCY'S POSITION IN THE MATTER, THERE ARE QUOTED BELOW ITS RESPONSES TO YOUR OCTOBER 19 LETTER.

"PRIOR TO DEALING IN DETAIL WITH THE VARIOUS CONTENTIONS RAISED IN MICROLAB/FXR'S LETTER, IT MUST BE BORNE IN MIND THAT THE PRIMARY PURPOSE OF THIS PROCUREMENT AND THE OTHERS OF THIS BUREAU IS THE ACQUISITION OF EQUIPMENT MEETING THE OPERATING NEEDS OF THE FLEET. THE PROCEDURES FOLLOWED IN THIS PROCUREMENT ARE THE SAME AS THOSE OF THE PREVIOUS PROCUREMENTS WHICH MICROLAB/FXR CITES IN ITS LETTER AS GOOD EXAMPLES OF PROMOTING COMPETITION. THESE TWO PROCUREMENTS WERE FOR TEST EQUIPMENT ( AN/USM-37 VSWR TEST SETS). BOTH WERE CONDUCTED BY MEANS OF TWO-STEP FORMAL ADVERTISING, AND BOTH REQUIRED THE SUBMISSION OF TEST DATA TO ENABLE A DETERMINATION OF THE ACCEPTABILITY OF TECHNICAL PROPOSALS. THE FIRST CASE, THE COMPANY'S PROPOSAL WAS FOUND ACCEPTABLE ON THE BASIS OF TEST DATA AND A SAMPLE SUBMITTED TO A NAVY LABORATORY, AND THE COMPANY WAS SUCCESSFUL IN RECEIVING A CONTRACT UNDER THE SECOND STEP. IN THE SECOND CASE, THE PROPOSAL WAS FOUND ACCEPTABLE AFTER THE COMPANY WAS ALLOWED TO SUPPLEMENT THE TEST DATA SUBMITTED WITH ITS INITIAL PROPOSAL BUT CONTRACT AWARD WAS MADE TO HEWLETT-PACKARD ON THE BASIS OF ITS LOW BID UNDER THE SECOND STEP. THUS, THE DIFFERENCE BETWEEN THESE TWO PREVIOUS PROCUREMENTS AND THE INSTANT PROCUREMENT APPEARS TO BE ONLY THAT IN THIS CASE THE BUREAU HAS DETERMINED AFTER REVIEW OF TEST DATA AND TESTING OF A MODEL THAT MICROLAB/FXR'S PROPOSAL IS UNACCEPTABLE.

"THE FOLLOWING COMMENTS APPLY TO THE CONTENTIONS IN ITS LETTER:

"1. THE LETTER REFERS IN DETAIL TO THE MEETING HELD AT THE BUREAU ON 22 JANUARY 1965. AT THIS TIME BUREAU REPRESENTATIVES POINTED OUT THE SPECIFIC AREAS IN WHICH THE PROPOSAL WAS CONSIDERED TO BE UNACCEPTABLE, WITH RESPECT TO BOTH THE ENVIRONMENTAL REQUIREMENTS OF EXHIBIT C AND ELECTRICAL REQUIREMENTS OF EXHIBIT D. CONCERNING THE FORMER, MICROLAB/FXR WAS INFORMED THAT THE BUREAU DID NOT AGREE WITH ITS CLAIMED SCORE OF 98.8 PERCENT SINCE THE WEIGHTED EVALUATION FACTORS IN THE SOLICITATION HAD BEEN INCORRECTLY APPLIED. AT NO TIME DID BUREAU REPRESENTATIVES REQUEST THAT MICROLAB/FXR MODIFY ITS DESIGN "SO THAT IT WOULD REFLECT THE DESIGN APPROACH OF HEWLETT-PACKARD," NOR DID THEY STATE THAT THE BUREAU'S REQUIREMENTS WOULD BE MODIFIED.

"2. MICROLAB/FXR CONTENDS THAT IT WAS GIVEN A VERY LIMITED TIME FOR THE DESIGN MODIFICATION AND RETESTING. THE AMENDMENT TO ITS PROPOSAL WAS DATED 19 MARCH 1965, APPROXIMATELY TWO MONTHS AFTER 22 JANUARY 1965, AND THE BUREAU BELIEVES THAT THIS INDICATES THAT THE COMPANY WAS AFFORDED ADEQUATE TIME. THE BUREAU IS NOT AWARE THAT ANY REQUEST WAS MADE FOR AN EXTENSION OF TIME. THE AMENDED PROPOSAL DID SHOW THAT THE EQUIPMENT HAD ACHIEVED A SCORE 100 PERCENT IN ACCORDANCE WITH EXHIBIT C.

"3. THE PROTESTANT STATES THAT THE REQUIREMENT FOR ZERO CARRYOVER IS NOT APPLICABLE TO ITS EQUIPMENT DUE TO THE DESIGN CONCEPT. THE ZERO CARRYOVER REQUIREMENT IS NECESSARY TO ELIMINATE EXCESSIVE ERRORS IN MEASUREMENT WHEN THE POWER MEASURING SET IS SWITCHED FROM ONE RANGE TO A HIGHER RANGE. THIS FEATURE IS NOT PECULIAR TO THE HEWLETT PACKARD EQUIPMENT. SPERRY MICROWAVE'S PROPOSAL MET THIS REQUIREMENT. IN WAS NOT CLEAR FROM MICROLAB/FXR'S PROPOSAL TO WHAT EXTENT ITS PROPOSED EQUIPMENT CONTAINED THIS FEATURE. THE TEST OF MICROLAB/FXR'S SAMPLE IN FACT SHOWED THAT EXCESSIVE ERRORS OCCURRED WHEN SWITCHING TO HIGHER POWER RANGES, AND THIS WAS ONE OF THE FACTORS LEADING TO A DETERMINATION THAT THE PROPOSED EQUIPMENT WAS NOT STABLE OR ACCURATE ENOUGH TO MEET BUREAU NEEDS.

"4. MICROLAB/FXR CONTENDS THAT SINCE THE REQUEST FOR SUBMISSION OF A SAMPLE WAS CONTAINED IN EXHIBIT B, A PRO-FORMA COPY OF THE CONTEMPLATED IFB WHICH WAS MARKED "FOR INFORMATION ONLY," THIS REQUIREMENT WAS NOT A PART OF THE SOLICITATION. AS POINTED OUT IN OUR LETTER OF 4 OCTOBER 1965, THE REQUEST FOR SUBMISSION OF THE SAMPLE WAS MADE TO AFFORD THE COMPANY AN OPPORTUNITY TO SHOW THAT ITS EQUIPMENT COULD MEET THE BUREAU'S REQUIREMENTS, AND WAS A REASONABLE ONE.

"5. MICROLAB/FXR INDICATES THAT IT WAS NOT ALLOWED A REASONABLE TIME TO SUBMIT THE SAMPLE. THE BUREAU'S LETTER OF 19 APRIL 1965 REQUESTED THAT ONE SAMPLE BE SUBMITTED BY 3 MAY 1965. MICROLAB/FXR'S LETTER OF 26 APRIL 1965 ASKED FOR AN EXTENSION UNTIL 20 MAY 1965 AND SUCH AN EXTENSION WAS AGREED TO IN THE BUREAU'S REPLY OF 29 APRIL 1965. THE BUREAU BELIEVES THAT ITS ACTION IN GRANTING THE REQUESTED EXTENSION EVIDENCES ITS WILLINGNESS TO COOPERATE WITH MICROLAB/FXR, AND ADDITIONALLY THAT REASONABLE TIME WAS AFFORDED THE COMPANY, PARTICULARLY IN VIEW OF THE FACT THAT A MODEL OF MICROLAB/FXR'S EQUIPMENT HAD ALREADY BEEN TESTED FOR PURPOSES OF SUBMITTING THE REQUIRED DATA.

"6. THE COMPANY STATES THAT IT MADE REPEATED REQUESTS TO THE BUREAU TO BE ALLOWED TO WITNESS AND DISCUSS TESTS CONDUCTED IN ITS EQUIPMENT. NEITHER THE BUREAU NOR THE NAVAL LABORATORY HAVE ANY RECORD OF ANY FORMAL REQUEST OF THIS NATURE. ADDITIONALLY, IT IS NOT THE NORMAL PRACTICE OF THE BUREAU TO ALLOW THE COMPANY TO WITNESS TESTING IN SIMILAR CIRCUMSTANCES. WHEN THE TESTS INDICATED THAT THE EQUIPMENT CLEARLY COULD NOT MEET THE NAVY'S REQUIREMENTS, THE COMPANY WAS SO INFORMED BY THE BUREAU'S LETTER OF 4 OCTOBER 1965.

"IN CONCLUSION, THE BUREAU HAS NO DESIRE TO ELIMINATE MICROLAB/FXR FROM COMPETING IN FUTURE PROCUREMENTS. HOWEVER, THE COMPANY CANNOT BE ALLOWED TO COMPETE FURTHER IN THIS PROCUREMENT. THE EVALUATION OF ITS TECHNICAL PROPOSAL HAS CLEARLY DEMONSTRATED THAT THE EQUIPMENT IT PROPOSED TO FURNISH IS NOT ACCEPTABLE.'

THE BID SAMPLE REQUIREMENT OF THE REQUEST FOR PROPOSALS CONSTITUTED, IN OUR OPINION, A PROPER EXERCISE OF PROCUREMENT RESPONSIBILITY AND IS REASONABLY CONTEMPLATED BY ASPR 2-503.1 (A). WHILE THE BID SAMPLE PROVISION WAS INCLUDED AS PART OF EXHIBIT "B," THE CONTEMPLATED INVITATION FOR BIDS, THE LANGUAGE OF THE PROVISION IS CLEARLY APPLICABLE TO THE FIRST -STEP SOLICITATION FOR TECHNICAL PROPOSALS. SINCE THE BID SAMPLE PROVISION WAS INCLUDED AS A PART OF THE PROCUREMENT PACKAGE REQUESTING TECHNICAL PROPOSALS, WE SEE NO REASON FOR CONCLUDING THAT SUCH PROVISION WAS NOT AN INTEGRAL PART OF THE FIRST-STEP SOLICITATION. IN THIS CONNECTION, SEE ASPR 2-202.4 (B) WHEREIN IS SET FORTH THE POLICY THAT BID SAMPLES MAY BE REQUIRED WHERE THE CHARACTERISTICS OF THE PRODUCT "CANNOT BE DESCRIBED ADEQUATELY IN THE APPLICABLE SPECIFICATION OR PURCHASE DESCRIPTION, THUS NECESSITATING THE SUBMISSION OF A SAMPLE TO ASSURE PROCUREMENT OF AN ACCEPTABLE PRODUCT.' IN VIEW OF THE CONDITIONS PRESCRIBED FOR USE OF TWO-STEP FORMAL ADVERTISING (ASPR 2-502 (A) (, IT WOULD SEEM APPROPRIATE TO PROVIDE FOR SAMPLE SUBMISSION AT THE OPTION OF THE GOVERNMENT DURING EVALUATION OF TECHNICAL PROPOSALS.

ON REVIEW OF THE RECORD, WE FIND NO BASIS TO QUESTION THE REJECTION OF YOUR TECHNICAL PROPOSAL OR THE INTENTION OF THE PROCUREMENT AGENCY TO NEGOTIATE A CONTRACT WITH HEWLETT-PACKARD PURSUANT TO ASPR 2-503.1 (F). SEE 40 COMP. GEN. 35; ID. 40; B-155433 DATED MAY 21 AND JUNE 17, 1965.