B-160330, MAY 8, 1967

B-160330: May 8, 1967

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TO PROCESS AUTOMATION COMPANY: FURTHER REFERENCE IS MADE TO YOUR LETTERS OF OCTOBER 21 AND NOVEMBER 11. PROPOSALS WERE REQUESTED FOR FURNISHING 25 COPY AND TRANSMIT (CAT) SYSTEMS IN ACCORDANCE WITH ATTACHED SPECIFICATIONS DATED JULY 14. FIVE OFFERS WERE RECEIVED BY AUGUST 15. THE OTHER THREE PROPOSALS RECEIVED WERE AS FOLLOWS: CHART: UNIT PRICES TOTAL TRAK-ELECTRONICS $4. YOU WERE ADVISED THAT THE DESCRIPTIVE DATA INITIALLY SUBMITTED AND SUBSEQUENTLY FURNISHED BY YOU DID NOT CONTAIN SUFFICIENT INFORMATION TO MAKE AN EVALUATION OF THE CONTROLLER. THAT IF SUCH INFORMATION WAS NOT MADE AVAILABLE BY OCTOBER 2. YOU ADVISED THAT ANY ADDITIONAL DATA YOU MIGHT SUPPLY WOULD INVOLVE THE PREPARATION OF FABRICATION DRAWINGS AND AS THIS WAS AN OPERATION WHICH YOU DID NOT FEEL WAS JUSTIFIED WITHOUT A COMMITMENT OF INTENT TO PURCHASE.

B-160330, MAY 8, 1967

TO PROCESS AUTOMATION COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTERS OF OCTOBER 21 AND NOVEMBER 11, 1966, PROTESTING AGAINST THE AWARD MADE TO TRANS CONTROLS, INC., UNDER REQUEST FOR PROPOSALS NO. N00228-67-R-4603, ISSUED BY THE NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA, ON JULY 21, 1966.

PROPOSALS WERE REQUESTED FOR FURNISHING 25 COPY AND TRANSMIT (CAT) SYSTEMS IN ACCORDANCE WITH ATTACHED SPECIFICATIONS DATED JULY 14, 1966. THE SPECIFICATIONS REQUIRED THAT CERTAIN BRAND NAMES AND MODEL NUMBERS, OR THEIR EQUIVALENT, BE FURNISHED FOR SEVERAL OF THE SUBASSEMBLIES AND COMPONENTS OF THE SYSTEM. IN THIS CONNECTION, THE REQUEST FOR PROPOSALS CONTAINED A "BRAND NAME OR EQUAL CLAUSE" AND SPECIFICALLY PROVIDED THAT "THE OFFEROR MUST FURNISH AS A PART OF HIS PROPOSAL ALL DESCRIPTIVE MATERIAL ... NECESSARY FOR THE PURCHASING ACTIVITY TO (1) DETERMINE WHETHER THE PRODUCT OFFERED MEETS THE REQUIREMENTS OF THE SOLICITATION * * *.' SEE ARMED SERVICE PROCUREMENT REGULATION (ASPR) 1-1206.5.

FIVE OFFERS WERE RECEIVED BY AUGUST 15, 1966, THE CLOSING DATE SPECIFIED IN THE REQUEST FOR PROPOSALS. YOUR PROPOSAL QUOTED A UNIT PRICE OF $4,259, AND A TOTAL PRICE OF $106,475. STANDARD MEMORIES QUOTED A UNIT PRICE OF $4,390 AND A UNIT PRICE OF $4,075 ON AN ALTERNATE, WITH TOTAL PRICES OF $109,750 AND $101,875, RESPECTIVELY. THE OTHER THREE PROPOSALS RECEIVED WERE AS FOLLOWS:

CHART:

UNIT PRICES TOTAL

TRAK-ELECTRONICS $4,395 $109,875

DECISION CONTROL, INC. 4,475 111,875

TRANS CONTROL, INC. 4,980 124,850

BY LETTER DATED AUGUST 26, 1966, THE CONTRACTING OFFICER REQUESTED THAT YOU FURNISH DESCRIPTIVE DATA, SKETCHES, ETC., OF THE ALTERNATE EQUIPMENT OFFERED BY YOU IN ORDER THAT A DETERMINATION COULD BE MADE AS TO WHETHER SUCH EQUIPMENT WOULD MEET THE REQUIREMENTS OF THE SPECIFICATIONS. ALSO, BY LETTER DATED OCTOBER 11, 1966, THE CONTRACTING OFFICER ADVISED ALL OFFERORS THAT OCTOBER 20TH HAD BEEN SET AS THE DATE FOR THE CLOSING OF NEGOTIATIONS AND THAT ANY REVISIONS TO OFFERS MUST BE RECEIVED BY THAT DATE. IN ADDITION THERETO, YOU WERE ADVISED THAT THE DESCRIPTIVE DATA INITIALLY SUBMITTED AND SUBSEQUENTLY FURNISHED BY YOU DID NOT CONTAIN SUFFICIENT INFORMATION TO MAKE AN EVALUATION OF THE CONTROLLER--- A COMPONENT OF THE CAT SYSTEM--- YOU INTENDED TO FURNISH, AND THAT IF SUCH INFORMATION WAS NOT MADE AVAILABLE BY OCTOBER 2, IT WOULD NOT BE POSSIBLE TO FURTHER EVALUATE YOUR OFFER.

IN REPLY DATED OCTOBER 18, 1966, YOU ADVISED THAT ANY ADDITIONAL DATA YOU MIGHT SUPPLY WOULD INVOLVE THE PREPARATION OF FABRICATION DRAWINGS AND AS THIS WAS AN OPERATION WHICH YOU DID NOT FEEL WAS JUSTIFIED WITHOUT A COMMITMENT OF INTENT TO PURCHASE, YOU REQUESTED A MEETING WITH TECHNICAL PERSONNEL TO CLARIFY ANY UNCERTAINTIES. AT THIS TIME, YOU MODIFIED YOUR PROPOSAL AND QUOTED A UNIT PRICE OF $4,216.41 FOR THE CAT SYSTEM USING A CONTROLLER OF YOUR MANUFACTURE AND OFFERED AN ALTERNATE USING THE TRANS CONTROLS, INC. CAT CONTROLLER MODEL 301/C, THE BRAND NAME REFERENCED IN THE SPECIFICATIONS, FOR A UNIT PRICE OF $4,259.

BY OCTOBER 20TH REPLIES WERE ALSO RECEIVED FROM THE FOUR OTHER OFFERORS AND TRANS CONTROLS, C., SUBMITTED THE LOWEST REVISED PRICE OF $3,690 PER UNIT. ALL BUT ONE OF THE OFFERORS (TRAK) SUBMITTED REVISED OFFERS WHICH WERE LOWER THAN THEIR ORIGINAL OFFERS. THE AWARD WAS MADE TO TRANS CONTROLS, INC., ON OCTOBER 21, 1966, AS THE LOWEST TECHNICALLY RESPONSIVE OFFEROR. WE ARE INFORMALLY ADVISED BY THE DEPARTMENT OF THE NAVY THAT THREE DELIVERIES OF 5 UNITS EACH HAVE BEEN MADE TO DATE WITH THE FOURTH DUE THE WEEK OF APRIL 24, 1967, AND THE FINAL DELIVERY DUE IN MAY 1967.

YOU PROTECT THE AWARD MADE TO TRANS CONTROLS, INC., BECAUSE YOU WERE THE LOW OFFEROR INITIALLY AND THAT YOU DID NOT UNDERSTAND FROM THE LETTER OF OCTOBER 11, 1966, THAT FURTHER NEGOTIATIONS WERE INTENDED. FURTHER, YOU OBSERVE THAT THE REQUESTED MEETING WITH THE NAVY ENGINEERS WAS NOT GRANTED AND FOR THAT REASON YOU WERE UNABLE TO ANSWER ANY QUESTIONS THEY MIGHT HAVE HAD REGARDING THE SPECIFICATIONS OR YOUR COMPANY'S BACKGROUND IN ORDER TO ASCERTAIN THAT YOU WERE TECHNICALLY CAPABLE AND COMPETENT TO DESIGN AND MANUFACTURE A CONTROLLER WHICH WOULD BE THE EQUAL OF THE TWO MODELS SPECIFIED. IT IS ALSO STATED THAT YOU DO NOT FEEL YOU WERE TREATED FAIRLY BECAUSE AT LEAST SOME OF THE OFFERORS HAD BECOME AWARE OF THE PRICES ORIGINALLY QUOTED BY THE VARIOUS OFFERORS AND THAT THE LOW FINAL OFFEROR WAS THEREBY AFFORDED THE OPPORTUNITY TO REDUCE ITS PRICE TO OBTAIN THE AWARD.

ASPR 3-507.2 (A) AND (B) PROVIDE, THAT AFTER RECEIPT OF PROPOSALS OR QUOTATIONS, NO INFORMATION CONTAINED IN ANY PROPOSAL OR QUOTATION REGARDING THE NUMBER OR IDENTITY OF THE OFFERORS SHALL BE MADE AVAILABLE AND THAT EQUAL CONSIDERATION AND INFORMATION MUST BE GIVEN TO ALL PROSPECTIVE CONTRACTORS. MOREOVER, ASPR 3-805.1 (B) PROHIBITS AUCTION TECHNIQUES WHENEVER NEGOTIATIONS ARE CONDUCTED WITH MORE THAN ONE OFFEROR, SUCH AS INDICATING TO AN OFFEROR A PRICE WHICH MUST BE MET TO OBTAIN FURTHER CONSIDERATION; OR INFORMING AN OFFEROR THAT HIS PRICE IS NOT LOW IN RELATION TO THAT OF ANOTHER OFFEROR. WE HAVE FOUND NOTHING IN THE RECORD BEFORE US WHICH WOULD INDICATE THAT THERE WAS ANY DISCLOSURE OF PRICES BY THE PROCUREMENT AGENCY DURING THE NEGOTIATION PERIOD TO ANY OF THE INDIVIDUAL FIRMS THAT RESPONDED TO THE REQUEST FOR PROPOSALS OR THAT OFFERORS WERE OTHERWISE INFORMED OF THE COMPETITIVE NATURE OF THEIR OFFERED PRICES.

IT IS CLEAR FROM THE RECORD THAT EQUAL OPPORTUNITY TO COMPETE FOR THE PROCUREMENT WAS EXTENDED TO YOU AND THAT YOU WERE GIVEN AT LEAST TWO OPPORTUNITIES TO BRING YOUR PROPOSAL TO AN ACCEPTABLE STATUS AND ONE OPPORTUNITY TO RECOMPUTE YOUR OFFERED PRICES. BUT YOU FAILED TO FURNISH, ON TWO OCCASIONS, SUFFICIENT INFORMATION WITH YOUR PROPOSAL TO ENABLE THE PROCUREMENT AGENCY TO DETERMINE WHETHER YOUR TENDERED PRODUCT WOULD MEET THE SPECIFICATIONS AND THE GOVERNMENT'S REQUIREMENTS. AT THE CONCLUSION OF THE NEGOTIATIONS, YOU WERE NOT COMPETITIVE AS TO PRICE OR AS TO THE DEMONSTRATED QUALITY OF YOUR PRODUCT. SINCE THE RECORD ESTABLISHES THAT TRANS CONTROLS HAD SUBMITTED THE LOWEST FINAL OFFER RESPONSIVE TO THE SPECIFICATIONS AND TO THE GOVERNMENT'S NEEDS, AWARD WAS PROPERLY MADE TO THAT OFFEROR. UPON REVIEW, WE FIND NO BASIS TO QUESTION THAT AWARD WHICH WAS ACCOMPLISHED IN ACCORDANCE WITH THE PROCEDURES GOVERNING NEGOTIATED PROCUREMENT. SEE SECTION III, PART 8, ASPR.

MOREOVER, YOU MAY BE ADVISED THAT UNDER THE "BRAND NAME OR EQUAL" CLAUSE OF THE REQUEST FOR PROPOSALS, IT WAS IMPROPER FOR THE CONTRACTING OFFICER TO SOLICIT THE REQUIRED DESCRIPTIVE LITERATURE FROM YOU SUBSEQUENT TO THE DATE FIXED FOR THE RECEIPT OF OFFERS. THAT IS TO SAY, YOUR OFFER AS SUBMITTED WAS MATERIALLY DEFICIENT FOR PURPOSES OF EVALUATION AND/OR NEGOTIATION SINCE IT WAS OTHERWISE NONRESPONSIVE TO A SUBSTANTIAL REQUIREMENT OF THE REQUEST FOR PROPOSALS. SEE 39 COMP. GEN. 490. IN THIS REGARD, YOU WERE SPECIFICALLY ADVISED IN THE REQUEST FOR PROPOSALS THAT THE GOVERNMENT MAY AWARD A CONTRACT, BASED ON INITIAL PROPOSALS RECEIVED, WITHOUT DISCUSSION, AND THAT "EACH INITIAL PROPOSAL SHOULD BE SUBMITTED IN THE MOST FAVORABLE TERMS FROM A PRICE AND TECHNICAL STANDPOINT WHICH THE OFFEROR CAN SUBMIT TO THE GOVERNMENT.'

ALTHOUGH A PRIOR PROCUREMENT FOR CAT UNITS WAS FORMALLY ADVERTISED, IT APPEARED THEREAFTER THAT THE SPECIFICATIONS WERE NOT OF SUCH A NATURE AS WOULD, IN THE FUTURE, ENCOURAGE MAXIMUM COMPETITION. IN CONSIDERATION OF THE SIGNIFICANT NUMBER OF "BRAND NAME" RESTRICTIONS IN THE SPECIFICATIONS AND OF THE FACT THAT ONLY TRANS CONTROLS AND ONE OTHER FIRM RESPONDED TO THE FORMAL ADVERTISEMENT, THE SUBJECT PROCUREMENT WAS NEGOTIATED UNDER THE AUTHORITY OF 10 U.S.C. 2304 (A) (10), AND ASPR 3-210.2 (XII). THE FIVE RESPONSES RECEIVED UNDER THE REQUEST FOR PROPOSALS IS INDICATIVE OF THE INCREASED COMPETITION GENERATED AS A RESULT OF THIS METHOD OF PROCUREMENT.