B-160637, MAR. 13, 1967

B-160637: Mar 13, 1967

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DSA 900-67-R-1081 ON THE GROUNDS THAT YOUR COMPANY WAS AN APPROVED SOURCE FOR THE ITEM IN QUESTION AND THAT THE PROPOSAL OF YOUR COMPANY WAS LOW BY SOME $25. YOU ALSO PROTEST THAT YOUR PROPOSAL WAS NOT REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR THE POSSIBLE ISSUANCE OF A CERTIFICATE OF COMPETENCY. THE SUBJECT PROCUREMENT IS FOR RESISTORS TO BE USED AS REPAIR PARTS IN RADAR SETS USED IN CONNECTION WITH THE HAWK MISSILE SYSTEM. THAT THE RESISTORS TO BE PROCURED WERE FOR CRITICAL CIRCUITS OF THE HAWK RADAR SET AND THAT "IT IS IMPERATIVE THAT ONLY THE MOST RELIABLE COMPONENTS AVAILABLE BE USED IN SUPPORT OF THESE REQUIREMENTS.'. THE CONTRACTING OFFICER THEREFORE MADE A FORMAL DETERMINATION AND FINDINGS THAT THE PROPOSED CONTRACT SHOULD BE NEGOTIATED PURSUANT TO 10 U.S.C. 2304 (A) (10) ON THE BASIS THAT IT WAS IMPRACTICABLE TO OBTAIN COMPETITION.

B-160637, MAR. 13, 1967

TO LEBO ELECTRONICS CORPORATION:

YOUR TELEGRAM OF JANUARY 5, 1967, PROTESTS THE AWARD OF A CONTRACT BY THE DEFENSE SUPPLY AGENCY (DSA) TO NEW ENGLAND INSTRUMENT COMPANY UNDER REQUEST FOR PROPOSALS (RFP) NO. DSA 900-67-R-1081 ON THE GROUNDS THAT YOUR COMPANY WAS AN APPROVED SOURCE FOR THE ITEM IN QUESTION AND THAT THE PROPOSAL OF YOUR COMPANY WAS LOW BY SOME $25,000. YOU ALSO PROTEST THAT YOUR PROPOSAL WAS NOT REFERRED TO THE SMALL BUSINESS ADMINISTRATION (SBA) FOR THE POSSIBLE ISSUANCE OF A CERTIFICATE OF COMPETENCY.

THE SUBJECT PROCUREMENT IS FOR RESISTORS TO BE USED AS REPAIR PARTS IN RADAR SETS USED IN CONNECTION WITH THE HAWK MISSILE SYSTEM. BEFORE ISSUANCE OF THE RFP, THE UNITED STATES ARMY MISSILE COMMAND (AMC), THE REQUIRING AGENCY, ADVISED THE DEFENSE ELECTRONICS SUPPLY CENTER (DESC), THAT THE RESISTORS TO BE PROCURED WERE FOR CRITICAL CIRCUITS OF THE HAWK RADAR SET AND THAT "IT IS IMPERATIVE THAT ONLY THE MOST RELIABLE COMPONENTS AVAILABLE BE USED IN SUPPORT OF THESE REQUIREMENTS.' AMC FURTHER ADVISED THAT ONLY VENDORS WHOSE PRODUCTS HAD PREVIOUSLY BEEN QUALIFIED IN ACCORDANCE WITH THE REQUIREMENTS SET OUT IN AMC DRAWING 9174777, REV. E, WHICH REQUIRED APPROVAL BY RAYTHEON COMPANY, HAWK MISSILE SYSTEM PRIME CONTRACTOR, SHOULD BE CONSIDERED FOR AWARD, AND LISTED FOUR SOURCES, NOT INCLUDING LEBO, WHICH HAD ALREADY OBTAINED THE REQUIRED APPROVAL.

THE CONTRACTING OFFICER THEREFORE MADE A FORMAL DETERMINATION AND FINDINGS THAT THE PROPOSED CONTRACT SHOULD BE NEGOTIATED PURSUANT TO 10 U.S.C. 2304 (A) (10) ON THE BASIS THAT IT WAS IMPRACTICABLE TO OBTAIN COMPETITION, INCORPORATING IN THE DETERMINATION AND FINDINGS THE AMC REQUIREMENT THAT ONLY SOURCES APPROVED BY RAYTHEON WERE ACCEPTABLE. THE RESULTING RFP CONTAINED THE FOLLOWING STATEMENT:

"THIS PROCUREMENT IS FOR A SOURCE CONTROLLED ITEM. BIDDERS OTHER THAN QUALIFIED SOURCES APPROVED BY RAYTHEON COMPANY, HAWK MISSILE SYSTEM PRIME CONTRACTOR, MUST FURNISH, CONCURRENTLY WITH THEIR PROPOSAL, EVIDENCE THAT THEIR ITEM HAS BEEN TESTED AND APPROVED BY RAYTHEON COMPANY AND/OR ARMY MISSILE COMMAND PRIOR TO THE CLOSING DATE OF THE REQUEST.'

YOUR COMPANY SUBMITTED A PROPOSAL WHICH INCLUDED A COVER LETTER STATING THAT ITS PRODUCT HAD BEEN APPROVED BY THE ARMY MISSILE COMMAND UNDER AN EARLIER CONTRACT. INCLUDED WITH THE COVER LETTER WAS A LETTER FROM THE ARMY ELECTRONICS COMMAND CONCERNING THE EARLIER LEBO CONTRACT BUT REFERENCING A FEDERAL STOCK NUMBER AND AN ARMY MISSILE COMMAND DRAWING NUMBER WHICH WERE DIFFERENT FROM THE ONES REQUIRED IN THE PRESENT PROCUREMENT. NO OTHER EVIDENCE WAS SUBMITTED TO SHOW THAT YOUR RESISTORS WOULD MEET THE STANDARDS REQUIRED BY AMC OR THE RAYTHEON COMPANY. RESPONSE TO A REQUEST FROM THE CONTRACTING OFFICER, THE HAWK PROJECT MANAGER'S OFFICE, AMC, ADVISED THAT LEBO WAS NOT PRESENTLY A QUALIFIED SOURCE AND THAT THE ONLY QUALIFIED SOURCES WERE THE FOUR ORIGINALLY LISTED. YOUR PROPOSAL, WHICH WAS LOW, THEREFORE WAS NOT CONSIDERED FURTHER AND AWARD WAS MADE TO NEW ENGLAND INSTRUMENT COMPANY, A QUALIFIED SOURCE AND THE SECOND LOW PROPOSER, ON DECEMBER 23, 1966.

SINCE YOUR PROPOSAL FAILED TO COMPLY WITH THE REQUIREMENT OF THE RFP THAT THE LEBO RESISTORS BE TESTED AND APPROVED BY RAYTHEON OR AMC PRIOR TO THE CLOSING DATE FOR RECEIPT OF PROPOSALS, WE CONCLUDE THAT THE CONTRACTING OFFICER PROPERLY REJECTED IT. THE FACT THAT THE LEBO RESISTORS QUALIFIED FOR THE EARLIER ARMY ELECTRONICS COMMAND PROCUREMENT HAS NO BEARING ON THEIR SUITABILITY FOR USE BY AMC IN THE PRESENT PROCUREMENT. AMC SPECIFICALLY DETERMINED IN RESPONSE TO THE CONTRACTING OFFICER'S REQUEST THAT THE LEBO RESISTORS HAD NOT BEEN TESTED AS REQUIRED BY THE RFP AND THAT SUCH TESTING WAS NECESSARY FOR QUALIFICATION OF THE RESISTORS FOR USE IN THE HAWK MISSILE SYSTEM. A DETERMINATION OF THIS SORT IS NECESSARILY THE FUNCTION OF THE ADMINISTRATIVE AGENCY AND WILL NOT BE QUESTIONED BY OUR OFFICE ABSENT A SHOWING OF BAD FAITH OR THE LACK OF A REASONABLE FACTUAL BASIS FOR THE DETERMINATION. THERE IS NO INDICATION THAT THIS IS SO IN THE PRESENT CASE. FURTHER, THE ISSUANCE OF A FORMAL DETERMINATION AND FINDINGS BY THE CONTRACTING OFFICER UNDER 10 U.S.C. 2304 (A) (10) IS MADE FINAL BY 10 U.S.C. 2310 (B), AND IS THEREFORE NOT SUBJECT TO QUESTION BY THIS OFFICE. IT IS NOTED, HOWEVER, THAT AMC HAS ADVISED THAT ANY VENDORS INTERESTED IN QUALIFYING THEIR PRODUCTS IN ACCORDANCE WITH DRAWING 9174777 SHOULD SUBMIT SAMPLES TO THE HAWK PROJECT OFFICE HEADQUARTERS, UNITED STATES ARMY MISSILE COMMAND, REDSTONE ARSENAL, ALABAMA 35809, ATTENTION: AMCPM-HAQ. IF YOU ARE INTERESTED IN QUALIFYING FOR FUTURE SIMILAR PROCUREMENTS, IT IS THEREFORE SUGGESTED THAT SAMPLES BE SUBMITTED FOR TESTING TO THE ABOVE ADDRESS.

YOU ALSO PROTEST THAT YOUR PROPOSAL WAS NOT SUBMITTED TO THE SBA FOR THE POSSIBLE ISSUANCE OF A CERTIFICATE OF COMPETENCY. SINCE YOUR PROPOSAL WAS NOT REJECTED FOR REASONS INVOLVING CAPACITY OR CREDIT--- THE TWO ELEMENTS WITH WHICH A CERTIFICATE OF COMPETENCY IS CONCERNED--- THERE WAS NO REQUIREMENT FOR REFERRAL TO SBA.