B-163118, MAR. 8, 1968

B-163118, MAR. 8, 1968

BIDS - SPECIFICATIONS - RESTRICTIVE DECISION DENYING PROTEST OF R. E. WHITE AND ASSOCIATES, INC., AGAINST RESTRICTIVE SPECIFICATIONS UNDER A NEGOTIATED PROCUREMENT FOR FURNISHING DEFENSE ELECTRONIC SUPPLY CENTER A THERMOSTATIC SWITCH FOR USE GROUND SUPPORT UNIT FOR HU-1 HELICOPTER. PROTESTANT WHO DID NOT SUBMIT PROPOSAL BUT WHO PROTESTS RESTRICTING SOURCE TO THOSE FIRMS WHICH HAVE PREVIOUSLY SUPPLIED SWITCH TO GOVERNMENT OR ORIGINAL MANUFACTURER MUST HAVE PROTEST DENIED SINCE SOLE SOURCE RESTRICTIONS SATISFY APPLICABLE STATUTES AND REGULATIONS SO THAT COMP. GEN. CANNOT QUESTION LEGALITY OF THEIR USE. HOWEVER IF REPEATED PURCHASES OF ITEM HAVE BEEN MADE OVER FIVE YEARS OR MORE ON SOLE-SOURCE BASIS GOVERNMENT MIGHT WELL HAVE BENEFITED BY DEVELOPING DATA TO ELIMINATE RESTRICTIVE REQUIREMENT.

TO R.E. WHITE AND ASSOCIATES, INCORPORATED:

WE REFER TO YOUR LETTERS OF DECEMBER 14, 1967, AND JANUARY 3, 1968, PROTESTING A PROVISION RESTRICTING CONSIDERATION TO THOSE OFFERORS WHO HAVE PREVIOUSLY FURNISHED THE SPECIFIED PART TO EITHER THE GOVERNMENT OR THE ORIGINAL MANUFACTURER OF THE EQUIPMENT IN WHICH THE ITEM IS USED, AS CONTAINED IN REQUEST FOR PROPOSALS NO. DSA-900-68-R-1615 ISSUED DECEMBER 6, 1967, BY THE DEFENSE ELECTRONIC SUPPLY CENTER (DESC), DAYTON, OHIO. THE ITEM IN QUESTION, A THERMOSTATIC SWITCH, IS A COMPONENT PART OF THE SOLAR DIVISION T-621 GAS TURBINE, WHICH, IN TURN, IS A PART OF THE ELECTRICAL GROUND SUPPORT UNIT FOR TYPE HU-1 HELICOPTER. THESE SWITCHES SENSE EXCESSIVELY HIGH TEMPERATURES AND STOP THE GAS TURBINE IN THE EVENT OF MALFUNCTION, THEREBY PREVENTING DAMAGE.

THE SUBJECT REQUEST FOR PROPOSALS, WHICH SPECIFIED "CONTROL PRODUCTS P/N P4090 LAW INT. HARVESTER, SOLAR DIV. DWG. 26521 REV. D.' CONTAINS THE FOLLOWING NOTE ON PAGE FOUR:

"OFFERORS NOTE: THE GOVERNMENT HAS DETERMINED THAT ONLY THOSE FIRMS WHO HAVE PREVIOUSLY FURNISHED THE ITEMS SPECIFIED HEREIN TO THE GOVERNMENT OR TO THE ORIGINAL EQUIPMENT MANUFACTURER (OEM) LISTED BELOW CAN SATISFY THE NEEDS OF THE GOVERNMENT. OFFERORS SHOULD INSERT THE APPLICABLE CONTRACT NUMBERS FOR PREVIOUSLY HELD GOVERNMENT/OEM ORDERS IN THE SPACE BELOW. OFFERS FROM FIRMS WHO HAVE NOT PREVIOUSLY FURNISHED THE SPECIFIED ITEMS TO THE GOVERNMENT OR THE OEM WILL NOT BE CONSIDERED.'

THE REPORT TO THIS OFFICE OF JANUARY 29, 1968, FROM HEADQUARTERS,DEFENSE SUPPLY AGENCY, ADVISES R.E. WHITE AND ASSOCIATES VOICED ITS OBJECTIONS AGAINST THIS SOURCE RESTRICTION TO THE PROCURING ACTIVITY BY A TELEPHONE CALL OF DECEMBER 13, 1967, AND A LETTER OF DECEMBER 14, 1967. BECAUSE WHITE WAS UNABLE TO HAVE A CHANGE EFFECTED IN THE PROVISION REGARDING THE SOURCE OF THE SWITCHES, IT DID NOT SUBMIT A PROPOSAL.

AT THE CLOSING DATE FOR THE RECEIPT OF PROPOSALS, DECEMBER 27, 1967, THREE PROPOSALS HAD BEEN RECEIVED, ONE FROM THE SPECIFIED MANUFACTURER, CONTROL PRODUCTS, INCORPORATED, AND TWO FROM REGULAR DEALERS IN THE FIELD, ALL OFFERING THE SPECIFIED CONTROL PRODUCTS THERMOSTATIC SWITCH.

THE CONTRACTING OFFICER PROPOSES TO MAKE AWARD TO THE LOW OFFEROR, CONTROL PRODUCTS, OF 114 UNITS AT $86.75 EACH, FOR A TOTAL OF $9,889.50. WE ARE ADVISED THAT AWARD IS BEING WITHHELD PENDING THE RESOLUTION OF THIS PROTEST.

WHITE CONTENDS THAT THE SUBJECT REQUEST FOR PROPOSALS UNNECESSARILY LIMITED THE POSSIBLE SOURCES OF SUPPLY FOR THE THERMOSTATIC SWITCHES BY RESTRICTING CONSIDERATION TO ONLY THOSE FIRMS WHICH HAD SUPPLIED THE SWITCH PREVIOUSLY TO EITHER THE GOVERNMENT OR THE ORIGINAL EQUIPMENT MANUFACTURER.

THE JANUARY 29, 1968, REPORT POINTS OUT THAT TWO REGULAR DEALERS IN THE ITEM SUBMITTED OFFERS WHICH WERE EVALUATED. THEREFORE, IT SEEMS THAT, IN PRACTICE, THE PROVISION DID NOT BAR CONSIDERATION OF INDIVIDUAL OFFERERS, SO LONG AS THE SPECIFIED ITEM WAS PROPOSED. IN ANY EVENT, DSA ADVISES THAT DESC WILL MODIFY THE PROVISION TO MAKE IT CLEAR THAT ALL OFFERS BASED UPON FURNISHING THE SOURCE CONTROLLED PART WILL BE CONSIDERED, WITHOUT REGARD TO WHETHER THE OFFEROR HAS PREVIOUSLY DEALT WITH THE ORIGINAL EQUIPMENT MANUFACTURER OR THE GOVERNMENT.

THIS PROPOSED CHANGE DOES NOT REACH THE BASIC PROBLEM RAISED BY WHITE, THE LIMITATION UPON THE SWITCHES THEMSELVES TO THOSE MANUFACTURED BY CONTROL PRODUCTS, INCORPORATED.

THE JANUARY 29, 1968, REPORT EXPLAINS THAT DRAWING NUMBER 26521 FURNISHED BY THE ORIGINAL EQUIPMENT MANUFACTURER, SOLAR DIVISION OF INTERNATIONAL HARVESTER COMPANY, PRODUCER OF THE GAS TURBINE IN WHICH THE THERMOSTATIC SWITCHES ARE INSTALLED, STATES THAT CONTROL PRODUCTS, INCORPORATED, IS THE ONLY APPROVED VENDOR FOR THIS ITEM, AND, FURTHER, THAT "A SUBSTITUTE ITEM SHALL NOT BE USED WITHOUT PRIOR TESTING AND APPROVAL BY SOLAR UNDER THE DIRECTION OF THE COGNIZANT CHIEF PROJECT ENGINEER.'

ON THIS BASIS, THE DESC ENGINEERING SUPPORT ACTIVITY RECOMMENDED AWARD BE MADE TO "CONTROL PRODUCTS OR TO A BIDDER WHO CAN CERTIFY TO QUALIFICATION APPROVAL BY SOLAR AIRCRAFT.'

BASED ON THIS TECHNICAL EVALUATION, THE CONTRACTING OFFICER DETERMINED THAT THE DESIRED THERMOSTATIC SWITCHES COULD ONLY BE PROCURED FROM THE ORIGINAL SUPPLIER OR ITS VENDORS.

THE REPORT CONCLUDES THAT SINCE "THE TECHNICAL PERSONNEL AND THE CONTRACTING OFFICER HAVE DONE NO MORE THAN TO FOLLOW THE REGULATIONS IN THIS CASE TO ASSURE THE REQUISITE RELIABILITY AND INTERCHANGEABILITY" , THE SUBJECT PROTEST SHOULD BE DENIED.

WE NOTE THAT THE DRAWING RELIED UPON BY THE ENGINEERING SERVICES DIVISION, DESC, IN ITS TECHNICAL EVALUATION OF THE DESIRED THERMOSTATIC SWITCHES, CONTAINS INFORMATION WHICH WOULD APPEAR TO BE USEFUL IN PREPARING A SPECIFICATION AND IN DETERMINING THE ACCEPTABILITY OF ALTERNATE PRODUCTS. FOR EXAMPLE, IT HAS A DRAWING OF THE CONTROL PRODUCTS THERMOSTATIC SWITCH, COMPLETE WITH DIMENSIONS, A STATEMENT OF ELECTRICAL CAPACITY, THERMAL RANGE, ACTUATION TEMPERATURE AND ACTUATION TIME, TOGETHER WITH A SIMPLE TESTING PROCEDURE. IT IS ALSO NOTEWORTHY THAT THIS DRAWING HAS REMAINED UNCHANGED SINCE OCTOBER 11, 1962.

ALTHOUGH THE PROCUREMENT HISTORY OF THIS ITEM IS NOT PRESENT IN THE RECORD BEFORE US, IF REPEATED PURCHASES HAVE BEEN MADE OF THIS SWITCH OVER FIVE YEARS OR MORE, ON A SOLE-SOURCE BASIS, THE GOVERNMENT MIGHT WELL HAVE BENEFITED BY DEVELOPING, PURCHASING, OR OTHERWISE OBTAINING THE DATA NEEDED TO ELIMINATE THE SOLE-SOURCE REQUIREMENT.

IT IS THE VIEW OF THIS OFFICE THAT GOVERNMENT PROCUREMENT ACTIVITIES SHOULD TAKE THE INITIATIVE TO ENCOURAGE THE BROADEST DEGREE OF COMPETITION POSSIBLE UNDER THE CIRCUMSTANCES. HOWEVER, AS POINTED OUT IN THE JANUARY 29, 1968, REPORT FROM DEFENSE SUPPLY AGENCY TO THIS OFFICE, THE PROTESTED SOLE-SOURCE RESTRICTIONS UPON THE SUBJECT PROCUREMENT CLEARLY SATISFY THE APPLICABLE STATUTES AND REGULATIONS, SO THAT THIS OFFICE CANNOT QUESTION THE LEGALITY OF THEIR USE IN THIS CASE.