B-162931, FEB. 21, 1968

B-162931: Feb 21, 1968

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DID NOT HAVE DATA TO DETERMINE THAT PARTS OFFERED BY PROTESTANT WERE OF SAME QUALITY AS SURPLUS PARTS OFFERED BY BRAND NAME MANUFACTURER WHEN SIMILAR CONDITIONS WERE COMPARABLE TO BOTH OFFERS. PURPOSES OF ASPR 1-1208 RELATING TO SURPLUS PROPERTY WERE NOT ACHIEVED. SINCE AWARD WAS MADE BY CONTRACTING OFFICER IN GOOD FAITH. CORRECTIVE ACTION IS NOT REQUIRED. TO GENERAL HEDLUND: REFERENCE IS MADE TO LETTER DSAH-G OF DECEMBER 19. OUR DECISION IS DIRECTED TO R. THE SUBJECT RFP WAS ISSUED ON MAY 11. THE REFERENCE TO THE HARTMAN AND LEAR SIEGLER PARTS WAS BASED ON THE REQUIREMENTS OF THE ENGINEERING SERVICES DIVISION. INFORMATION THAT HARTMAN AND LEAR SIEGLER WERE THE KNOWN SOURCES FOR THE REQUIRED UNIT AND THAT NO DATA SUFFICIENT FOR COMPETITIVE PROCUREMENT BY FORMAL ADVERTISING WAS AVAILABLE.

B-162931, FEB. 21, 1968

BIDS - GOVERNMENT SURPLUS CLAUSES DECISION TO DEFENSE SUPPLY AGENCY CONCERNING PROTEST OF R.E. WHITE AND ASSOCIATES, INC., AGAINST REJECTION OF LOW OFFER BECAUSE BRAND NAME SURPLUS OFFERED COULD NOT BE TESTED. WHERE LOW OFFEROR HAD OFFER TO FURNISH GOVT. SURPLUS REJECTED BECAUSE GOVT. DID NOT HAVE DATA TO DETERMINE THAT PARTS OFFERED BY PROTESTANT WERE OF SAME QUALITY AS SURPLUS PARTS OFFERED BY BRAND NAME MANUFACTURER WHEN SIMILAR CONDITIONS WERE COMPARABLE TO BOTH OFFERS, PURPOSES OF ASPR 1-1208 RELATING TO SURPLUS PROPERTY WERE NOT ACHIEVED. HOWEVER, SINCE AWARD WAS MADE BY CONTRACTING OFFICER IN GOOD FAITH, PURSUANT TO TECHNICAL ADVICE, CORRECTIVE ACTION IS NOT REQUIRED. SEE B-155524, JANUARY 14, 1965.

TO GENERAL HEDLUND:

REFERENCE IS MADE TO LETTER DSAH-G OF DECEMBER 19, 1967, FROM THE OFFICE OF COUNSEL, REPORTING ON THE PROTEST OF R.E. WHITE AND ASSOCIATES, INC., AGAINST THE AWARD OF CONTRACTS TO OTHER OFFERORS UNDER REQUESTS FOR PROPOSALS (RFP) NOS. DSA900-67-R-3042, -3346 AND 68-R-1100.

WE OBSERVE THAT AWARD OF A CONTRACT HAS BEEN MADE TO R. E. WHITEUNDER RFP -3346, AND THAT RFP -1100 HAS BEEN CANCELED BY THE PROCUREMENT OFFICE. THEREFORE, OUR DECISION IS DIRECTED TO R. E. WHITE'S PROTEST UNDER RFP - 3042.

THE SUBJECT RFP WAS ISSUED ON MAY 11, 1967, BY THE DEFENSE ELECTRONICS SUPPLY CENTER (DESC) AND CALLED FOR INCREMENTAL QUANTITIES OF "RELAY" LEAR SIEGLER, INC., P/N 52000-1001, HARTMAN ELECTRICAL MANUFACTURING P/N A751KM. THE REFERENCE TO THE HARTMAN AND LEAR SIEGLER PARTS WAS BASED ON THE REQUIREMENTS OF THE ENGINEERING SERVICES DIVISION, DESC, AND INFORMATION THAT HARTMAN AND LEAR SIEGLER WERE THE KNOWN SOURCES FOR THE REQUIRED UNIT AND THAT NO DATA SUFFICIENT FOR COMPETITIVE PROCUREMENT BY FORMAL ADVERTISING WAS AVAILABLE. IN VIEW THEREOF, THE CONTRACTING OFFICER ISSUED A DETERMINATION AND FINDINGS ON MAY 2, 1967, THAT THE PROCUREMENT OF 55 UNITS (RFP -3042) COULD BE NEGOTIATED UNDER THE AUTHORITY OF 10 U.S.C. 2304 (A) (10), AS IMPLEMENTED BY ASPR 3-210.2 (XIII), CITING SPECIFICALLY THE IMPRACTICABILITY OF DRAFTING ADEQUATE SPECIFICATIONS FOR FORMAL ADVERTISING. A REQUIREMENT FOR AN ADDITIONAL 57 UNITS WAS RECEIVED ON OR ABOUT JUNE 30, 1967, AND AN ADDENDUM TO THE EARLIER DETERMINATION AND FINDINGS WAS ISSUED COVERING THE NEW QUANTITY.

IT IS REPORTED THAT RFP -3042 WAS SENT TO ALL CONCERNS SUBMITTING A REQUEST THEREFOR AND FIVE OFFERORS TENDERED PROPOSALS PRIOR TO THE CLOSING TIME ON MAY 31, 1967. THESE PROPOSALS WERE AS FOLLOWS:

BIDDER ITEM OFFERED UNIT PRICE HARTMAN ELECTRICAL

MANUFACTURING CO. HARTMEN P/N A751KM $ 83.00 LEAR SIEGLER

LEAR SIEGLER P/N

52000-1001 121.05 PLAIN-TRONICS CO.

HARTMAN P/N A751KM 86.13 ESCO, INC. HARTMAN P/N A751KM

87.00 R.E. WHITE AND ASSOCIATES, INC. HARTMAN P/N A751KM 50.00

WHITE STATED IN ITS OFFER THAT "ALL ITEMS ARE NEW AND UNUSED SURPLUS PROPERTY, AND ARE CONSIDERED TO BE FORMER GOVERNMENT SURPLUS PROPERTY, BUT WERE NOT ACQUIRED FROM ANY GOVERNMENT AGENCY. BIDDER WILL ACCEPT INCLUSION OF -SPECIAL INSPECTION CLAUSE- ON ANY RESULTING CONTRACT.' SINCE WHITE OFFERED SURPLUS MATERIAL, THE CONTRACTING OFFICER REQUESTED A TECHNICAL EVALUATION OF THE PROPOSAL; THEREAFTER, HE WAS ADVISED THAT AVAILABLE DATA DID NOT ALLOW AN EVALUATION OF THE UNITS OFFERED BY WHITE SO THAT PROPER TESTING COULD BE CONDUCTED TO DETERMINE THEIR FITNESS. THE CONTRACTING OFFICER THEN REQUESTED FROM WHITE SUCH DATA AS IT MIGHT POSSESS WHICH COULD AID IN EVALUATING ITS PROPOSAL AS TO QUALITY OF THE SURPLUS MATERIAL IT WAS OFFERING, AND IN RESPONSE WHITE RETURNED A HARTMEN DRAWING OF PART NO. A751KM WHICH WAS EVALUATED TO DETERMINE THE ACCEPTABILITY OF THE WHITE OFFER. HOWEVER, IT WAS REPORTED BY TECHNICAL PERSONNEL THAT SUFFICIENT INFORMATION WAS NOT AVAILABLE FOR AN EVALUATION AND TESTING OF THE WHITE ITEMS AND, THEREFORE, THE WHITE OFFER WAS DETERMINED TO BE UNACCEPTABLE. BASED ON THE FOREGOING, DESC REJECTED THE OFFER OF WHITE TO FURNISH THE ITEMS IDENTIFIED AS FORMER NEW AND UNUSED GOVERNMENT SURPLUS. ACCORDINGLY, AWARD OF CONTRACT WAS MADE TO HARTMAN ELECTRICAL MANUFACTURING CO. UNDER RFP -3042 AT A UNIT PRICE OF $83.

RFP -3042 CONTAINED THE FOLLOWING PERTINENT PROVISIONS:

A. CLAUSE 32 OF FORM DESC-P-71-479 (APRIL 1967) INCORPORATED IN THE RFP BY REFERENCE READ: ,GOVERNMENT SURPLUS (1) IN THE EVENT THE BID OR PROPOSAL IS BASED ON FURNISHING ITEMS OR COMPONENTS WHICH ARE FORMER GOVERNMENT SURPLUS PROPERTY OR RESIDUAL INVENTORY RESULTING FROM TERMINATED GOVERNMENT CONTRACTS, A COMPLETE DESCRIPTION OF THE ITEMS OR COMPONENTS, QUANTITY TO BE USED, NAME OF GOVERNMENT AGENCY FROM WHICH ACQUIRED, AND DATE OF ACQUISITION SHALL BE SET FORTH BELOW: NOTWITHSTANDING ANY INFORMATION PROVIDED IN ACCORDANCE WITH THIS PROVISION, ITEMS FURNISHED BY THE CONTRACTOR MUST COMPLY IN ALL RESPECTS WITH THE SPECIFICATIONS CONTAINED HEREIN. (2) EXCEPT AS DISCLOSED BY THE CONTRACTOR IN (1) ABOVE, NO PROPERTY OF THE TYPE DESCRIBED HEREIN SHALL BE FURNISHED UNDER THIS CONTRACT UNLESS APPROVED IN WRITING BY THE CONTRACTING OFFICER.'

B. CLAUSE 35 OF FORM DESC-P-71-484 (NOVEMBER 1966) INCORPORATED BY REFERENCE IN RFP -3042 EAD: "NEW MATERIAL EXCEPT AS TO ANY SUPPLIES AND COMPONENTS WHICH THE SPECIFICATION OR SCHEDULE SPECIFICALLY PROVIDES NEED NOT BE NEW, THE CONTRACTOR REPRESENTS THAT THE SUPPLIES AND COMPONENTS INCLUDING ANY FORMER GOVERNMENT PROPERTY IDENTIFIED PURSUANT TO THE - GOVERNMENT SURPLUS' CLAUSE OF THIS CONTRACT TO BE PROVIDED UNDER THIS CONTRACT ARE NEW (NOT USED OR RECONDITIONED, AND NOT SUCH AGE OR SO DETERIORATED AS TO IMPAIR THEIR USEFULNESS OR SAFETY). IF AT ANY TIME DURING THE PERFORMANCE OF THIS CONTRACT THE CONTRACTOR BELIEVES THAT THE FURNISHING OF SUPPLIES OR COMPONENTS WHICH ARE NOT NEW IS NECESSARY OR DESIRABLE, HE SHALL NOTIFY THE CONTRACTING OFFICER IMMEDIATELY IN WRITING, INCLUDING THE REASONS THEREFOR AND PROPOSING ANY CONSIDERATION WHICH WILL FLOW TO THE GOVERNMENT IF AUTHORIZATION TO USE SUCH SUPPLIES IS GRANTED.'

THE EVALUATION DATA PROVISIONS OF THE RFP PROVIDED: "THE GOVERNMENT IS NOT IN POSSESSION OF THE DATA SPECIFIED IN THE DESCRIPTION OF ITEM/S) ---- 1----, THEREFORE, ANY OFFERS RESULTING FROM THIS INQUIRY/SOLICITATION MUST BE ACCOMPANIED BY THE SPECIFIED DATA TOGETHER WITH THE OFFEROR'S DATA FOR THE EVALUATION OF THE QUOTED PROPOSAL. DATA SUBMITTED WILL NOT BE RETURNED TO THE OFFEROR. FAILURE TO SUBMIT BOTH SETS OF DATA WITH QUOTE/PROPOSAL MAY RESULT IN THE REJECTION OF ANY RESULTING OFFER. HOWEVER, SUBMISSION OF ABOVE DATA IS NOT REQUIRED BY ANY SUPPLIER WHOSE SPECIFICATION, DRAWING, OR PART NUMBER APPEARS IN OR WITH THE ITEM DESCRIPTION.'

AS POINTED OUT IN THE ADMINISTRATIVE REPORT, THE GOVERNMENT SURPLUS AND NEW MATERIAL CLAUSES ARE IDENTICAL TO THE CLAUSES CONTAINED IN THE RFP CONSIDERED IN OUR DECISION B-155524, JANUARY 14, 1965, TO THE SECRETARY OF THE AIR FORCE, INVOLVING ALSO A PROTEST BY WHITE. ALSO, THE LANGUAGE INSERTED BY WHITE IN RESPONSE TO THE GOVERNMENT SURPLUS CLAUSES OF BOTH OF THESE PROPOSALS IS SIMILAR INSOFAR AS CONCERNS THE PROTEST AGAINST REJECTION OF ITS OFFER. IN THE DECISION OF JANUARY 14, 1965, WE HELD:

"THE PROPONENT REPRESENTED IN SCHEDULE PROVISION -S' THAT THE ITEMS WERE NEW. UNDER THE REPRESENTATION IN SCHEDULE PROVISION -R- WITH RESPECT TO WHAT IS -NEW,- THE PROPONENT CERTIFIED THAT THE ITEMS WERE NOT USED OR RECONDITIONED AND NOT OF SUCH AGE OR SO DETERIORATED AS TO IMPAIR THEIR USEFULNESS OR SAFETY. MOREOVER, SCHEDULE PROVISION -S,- IN ADDITION TO THE MATERIAL QUOTED ABOVE, STATES THAT THE ITEMS MUST COMPLY WITH THE SPECIFICATION IN ALL RESPECTS DESPITE ANY INFORMATION PROVIDED BY THE PROPONENT IN PROVISION -S.-

"THEREFORE, IT SEEMS APPARENT THAT IF ANY AWARD HAD BEEN MADE TO THE PROPONENT IT WOULD HAVE BEEN OBLIGATED TO FURNISH PROPERTY MEETING THE STANDARD FOR -NEW- SET OUT IN THE SCHEDULE DESPITE THE DATA IT MAY OR MAY NOT HAVE FURNISHED IN PROVISION -S.- IT FOLLOWS, THEN, THAT THE PROPONENT SHOULD NOT HAVE BEEN PENALIZED FOR THE INFORMATION OR LACK THEREOF IN PROVISION -S' OF ITS PROPOSAL.'

HOWEVER, THE PRINCIPAL ADMINISTRATIVE OBJECTION TO THE AWARD TO WHITE IS THAT THE GOVERNMENT DOES NOT HAVE DATA FROM WHICH IT CAN ASCERTAIN THAT THE SURPLUS HARTMAN PARTS OFFERED BY WHITE ARE OF THE SAME QUALITY AS THE HARTMAN PARTS OFFERED BY HARTMAN AND OTHER OFFERORS. IT IS SUGGESTED THAT THE SURPLUS PARTS MAY HAVE DETERIORATED IN STORAGE, MAY HAVE BEEN SUBJECTED TO ROUGH HANDLING, MAY BE FROM REJECTED LOTS, ETC. HOWEVER, THESE SAME CONDITIONS COULD VERY WELL EXIST IN RESPECT TO THE PARTS OFFERED BY THE NAME BRAND MANUFACTURER OR OTHER OFFERORS OF ITS PRODUCT, AND THE GOVERNMENT APPARENTLY DOES NOT SEEK ASSURANCES FROM THESE OFFERORS AGAINST THESE CONTINGENCIES AND APPARENTLY IT WOULD HAVE NO MEANS OF ASCERTAINING ANY DEFICIENCIES, SINCE ADMITTEDLY IT HAS NO DATA WHICH CAN BE USED FOR TESTING THE PARTS.

WE FIND NO BASIS UNDER THE INSTANT RFP OR THE REPORTED FACTS TO DISTINGUISH THIS PROCUREMENT FROM THE ONE WE CONSIDERED IN B-155524. MOREOVER, THE RFP AFFORDED SUFFICIENT PROTECTION AND REMEDIES TO THE GOVERNMENT RESPECTING THE FURNISHING AND RECEIPT OF NEW AND UNUSED GOVERNMENT SURPLUS PROPERTY AS WOULD HAVE AFFORDED A BASIS FOR AN AWARD AT A LOWER PRICE TO WHITE. THE RFP CONFORMED TO THE REQUIREMENTS OF ASPR 1- 1208 IN THIS RESPECT AND THE PURPOSES SOUGHT TO BE OBTAINED THEREBY WERE NOT ATTAINED UNDER THIS PROCUREMENT.

HAVING REGARD FOR THE FACT THAT THE CONTRACTING OFFICER MADE AN AWARD UNDER THE RFP PURSUANT TO TECHNICAL ADVICE AND IN APPARENT GOOD FAITH, WE DO NOT FEEL THAT CORRECTIVE ACTION IS NOW REQUIRED.