B-163767, AUGUST 5, 1968, 48 COMP. GEN. 49

B-163767: Aug 5, 1968

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

RECOGNIZED THAT POTENTIAL BIDDERS WOULD HAVE TO MODIFY FAA CERTIFIED HELICOPTERS SUBMITTED IN THE FIRST-STEP IN ORDER TO MEET THE SPECIFICATIONS WAS NOT IMPROPER. THE ACCEPTANCE OF A PROPOSAL BASED UPON THE DETERMINATION THAT THE NECESSARY MODIFICATIONS TO MEET THE SPECIFICATIONS INTRODUCED ONLY A MINOR TECHNICAL RISK AND DID NOT CAST REASONABLE DOUBT ON THE ACHIEVABILITY OF THE PROPOSAL WILL NOT BE QUESTIONED ABSENT FRAUD. BIDS - TWO-STEP PROCUREMENT - USE BASIS THE STRICT RULE THAT ALL BIDS MUST RESPOND FULLY TO THE REQUIREMENTS OF AN INVITATION SO THAT THE CONTRACT AWARDED WILL BE THE SAME CONTRACT OFFERED TO ALL BIDDERS IS NOT FOR APPLICATION IN THE EVALUATION OF THE TECHNICAL PROPOSALS SUBMITTED ON COMPLEX ITEMS IN THE FIRST-STEP OF A TWO- STEP PROCUREMENT SINCE IN ORDER TO ACCOMPLISH THE OBJECTIVES OF THE TWO- STEP PROCUREMENT PROCEDURE AUTHORIZED BY PARAGRAPH 2-501 OF THE ARMED SERVICES PROCUREMENT REGULATION A CONSIDERABLE ELEMENT OF FLEXIBILITY IS REQUIRED AND.

B-163767, AUGUST 5, 1968, 48 COMP. GEN. 49

BIDS - TWO-STEP PROCUREMENT - TECHNICAL PROPOSALS - MODIFICATION THE USE OF THE TWO-STEP FORMAL ADVERTISING METHOD OF PROCUREMENT AUTHORIZED BY PARAGRAPH 2-501 OF THE ARMED SERVICES PROCUREMENT REGULATION FOR THE PURCHASE OF HELICOPTERS, WHERE THE REQUEST FOR TECHNICAL PROPOSALS AVOIDED UNNECESSARY RESTRICTIVE STATEMENTS OF THE GOVERNMENT'S REQUIREMENTS IN ORDER TO PROMOTE COMPETITION, AND RECOGNIZED THAT POTENTIAL BIDDERS WOULD HAVE TO MODIFY FAA CERTIFIED HELICOPTERS SUBMITTED IN THE FIRST-STEP IN ORDER TO MEET THE SPECIFICATIONS WAS NOT IMPROPER, AND THE ACCEPTANCE OF A PROPOSAL BASED UPON THE DETERMINATION THAT THE NECESSARY MODIFICATIONS TO MEET THE SPECIFICATIONS INTRODUCED ONLY A MINOR TECHNICAL RISK AND DID NOT CAST REASONABLE DOUBT ON THE ACHIEVABILITY OF THE PROPOSAL WILL NOT BE QUESTIONED ABSENT FRAUD, ABUSE OF AUTHORITY, OR ARBITRARY ACTION IN THE EVALUATION OF THE PROPOSAL. BIDS - TWO-STEP PROCUREMENT - USE BASIS THE STRICT RULE THAT ALL BIDS MUST RESPOND FULLY TO THE REQUIREMENTS OF AN INVITATION SO THAT THE CONTRACT AWARDED WILL BE THE SAME CONTRACT OFFERED TO ALL BIDDERS IS NOT FOR APPLICATION IN THE EVALUATION OF THE TECHNICAL PROPOSALS SUBMITTED ON COMPLEX ITEMS IN THE FIRST-STEP OF A TWO- STEP PROCUREMENT SINCE IN ORDER TO ACCOMPLISH THE OBJECTIVES OF THE TWO- STEP PROCUREMENT PROCEDURE AUTHORIZED BY PARAGRAPH 2-501 OF THE ARMED SERVICES PROCUREMENT REGULATION A CONSIDERABLE ELEMENT OF FLEXIBILITY IS REQUIRED AND, THEREFORE, THE REGULATION PROVIDES FOR DISCUSSION WITH ANY OFFEROR OF HIS PROPOSAL, WHICH MAKES THE FIRST-STEP EVALUATION PROCEDURE MORE IN THE NATURE OF A NEGOTIATED PROCEDURE THAN OF STRICT FORMAL ADVERTISING.

TO THE HUGHES TOOL COMPANY, AUGUST 5, 1968:

REFERENCE IS MADE TO YOUR TELEGRAM OF MARCH 8, 1968, AND SUBSEQUENT COMMUNICATIONS PROTESTING THE AWARD OF A CONTRACT FOR LIGHT OBSERVATION HELICOPTERS TO BELL HELICOPTER COMPANY UNDER INVITATION FOR BIDS NO. DAAJO -68-B-0049/0), A TWO-STEP FORMALLY ADVERTISED PROCUREMENT.

THE HISTORY OF THE AWARD IS SET FORTH IN THE CONTRACTING OFFICER'S REPORT (WHICH WAS MADE AVAILABLE TO YOUR COUNSEL) AS FOLLOWS:

IN KEEPING THE SECRETARY OF THE ARMY'S EXPRESSED INTENTION TO PROMOTE COMPETITION IN THE PROCUREMENT OF LIGHT OBSERVATION HELICOPTERS (LOH) (TAB D), THE ARMY, IN THE SUMMER OF 1967, DETERMINED TO PROCURE ITS ESTIMATED FIVE-YEAR REQUIREMENT, FOR LIGHT OBSERVATION HELICOPTERS BY MEANS OF TWO- STEP FORMAL ADVERTISING UNDER ASPR SECTION II, PART 5. BY SO DOING THE ARMY WAS BOUND TO SEEK MAXIMUM COMPETITION AND TO AVOID ANY UNNECESSARILY RESTRICTIVE STATEMENT OF THE GOVERNMENT'S REQUIREMENTS.

STEP I OF IFB DAAJ01-68-B-0049/0), WAS INITIATED BY A REQUEST FOR TECHNICAL PROPOSALS (RFTP), ISSUED ON 29 AUGUST 1967, AND ENCOMPASSED THE PROCUREMENT OF THE GOVERNMENT'S ESTIMATED REQUIREMENTS FOR FISCAL YEARS 1968, 1969, 1970, AND 1971 FOR A TOTAL OF APPROXIMATELY TWO THOUSAND TWO HUNDRED SEVENTY-NINE (2,279) EACH LIGHT OBSERVATION HELICOPTERS, DATA, PUBLICATIONS, REPAIR PARTS, SPECIAL TOOLS, TRAINING AND TRAINING AIDS/DEVICES. THIS RFTP, TOGETHER WITH ITS AMENDMENTS AND EXHIBITS, IS ATTACHED UNDER TAB E. THIS SOLICITATION REQUIRED THAT AIRCRAFT PROPOSED IN THIS PROCUREMENT BY CONTRACTORS CONFORM TO EXHIBIT I TO THE LETTER PORTION OF THE RFTP, THE GENERAL SPECIFICATION FOR LIGHT OBSERVATION HELICOPTERS DATED 25 JULY 1967 (HEREIN REFERRED TO AS THE GENERAL SPECIFICATION). THE 39 CONCERNS SOLICITED, THREE FIRMS, BELL HELICOPT, FAIRCHILD-HILLER, AND HUGHES TOOL COMPANY, AIRCRAFT DIVISION, SUBMITTED NOTICES OF INTENT TO PARTICIPATE IN THE COMPETITION. THEREAFTER, AT A JOINT CONFERENCE HELD 7 SEPTEMBER 1967, THEY WERE GRANTED OPPORTUNITY TO QUESTION THE GOVERNMENT ON THE RFTP. A COPY OF THE MINUTES OF THIS CONFERENCE IS INCLUDED UNDER TAB F. FAIRCHILD-HILLER WITHDREW PRIOR TO SUBMITTING AN AIRCRAFT FOR FLIGHT TEST. BELL HELICOPTER COMPANY AND HUGHES TOOL COMPANY. AIRCRAFT DIVISION, SUBMITTED AIRCRAFT AND TECHNICAL PROPOSALS TO THE GOVERNMENT FOR EVALUATION.

THE PROCESS OF DETERMINING ACCEPTABILITY OF TECHNICAL PROPOSALS DURING STEP I OF THE COMPETITION CONSISTED OF EVALUATION OF THE PROPOSALS BY A SOURCE SELECTION EVALUATION BOARD, CONSISTING OF TECHNICAL PERSONNEL OF THE US ARMY MATERIEL COMMAND; REVIEW OF THE SOURCE SELECTION EVALUATION BOARD'S FINDINGS AND RECOMMENDATIONS BY A SOURCE SELECTION ADVISORY COUNCIL CONSISTING OF HIGH RANKING ARMY OFFICERS, GENERALS, AND GENERAL DESIGNEES; AND FINAL DETERMINATION ON ACCEPTABILITY BY A SOURCE SELECTION AUTHORITY, THE COMMANDING GENERAL, US ARMY MATERIEL COMMAND.

AFTER EXTENSIVE DISCUSSION WITH BIDDERS CONCERNING THEIR RESPECTIVE PROPOSALS AND EVALUATION OF DATA OBTAINED THROUGH FLIGHT TESTING OF AIRCRAFT AND DATA SUBMITTED BY BIDDERS AND GENERATED BY US ARMY MATERIEL COMMAND TECHNICAL PERSONNEL, THE SOURCE SELECTION EVALUATION BOARD RECOMMENDED THAT THE TECHNICAL PROPOSALS SUBMITTED BY BELL HELICOPTER COMPANY AND THE PROTESTANT BE DETERMINED TO BE ACCEPTABLE. THE SOURCE SELECTION ADVISORY COUNCIL CONCURRED IN THIS RECOMMENDATION, AND THE SOURCE SELECTION AUTHORITY, THE COMMANDING GENERAL, US ARMY MATERIEL COMMAND, ON 5 JANUARY 1968, BY LETTER (TAB H) TO THE COMMANDING GENERAL, US ARMY AVIATION MATERIEL COMMAND, DETERMINED BOTH PROPOSALS TOBE ACCEPTABLE.

STEP II, AN INVITATION FOR BIDS (IFB) UNDER ASPR 2-503.2, WAS ISSUED ON 27 JANUARY 1968. THIS IFB CONTAINED REQUIREMENTS FOR LIGHT OBSERVATION HELICOPTERS DURING FISCAL YEARS 1968, 1969, 1970, 1971, AND 1972; A TOTAL OF TWO THOUSAND TWO HUNDRED (2,200) HELICOPTERS AND OPTIONS FOR AN ADDITIONAL SIX HUNDRED SEVENTY-FIVE (675) HELICOPTERS. A BID CONFERENCE, ATTENDED BY BOTH BIDDERS, WAS HELD ON 1 FEBRUARY 1968 AT WHICH TIME EACH WAS AFFORDED FULL OPPORTUNITY TO ASK QUESTIONS AND MAKE RECOMMENDATIONS CONCERNING THE IFB. THE WRITTEN SUMMARY OF COMMENTS) QUESTIONS WHICH WERE RAISED AT THE 1 FEBRUARY 1968 BIDDERS'S CONFERENCE WAS PROVIDED TO BOTH BIDDERS (TAB J). THE STEP II IFB WAS AMENDED TO CORRECT ERRORS, CLARIFY THE GOVERNMENT'S REQUIREMENT, AND TO UPDATE THE IFB. TWO RESPONSIVE BIDS WERE RECEIVED ON 26 FEBRUARY 1968. THESE BIDS WERE AS FOLLOWS:

BHC HTC

--- --- UNIT PRICE OF HELICOPTERS

$ 53,450 $ 59,700 TOTAL BID PRICE FOR 2,200 HELICOPTERS, DATA, REPAIR ARTS, SPECIAL TOOLS AND TRAINING AIDS/DEVICES $123,086,647 $137,519,027 EVALUATION FACTORS (FERRY AND TRANSPORTATION COSTS) $ 733,971 $ 944,120

------------ ------------ TOTAL EVALUATED BID PRICE

$123,820,618$138,463,147

BOTH BIDDERS WERE DETERMINED QUALIFIED TO PERFORM THE REQUIREMENTS OF THE IFB BY THE GOVERNMENT PRE-AWARD FACILITIES SURVEY TEAM. AFTER SECURING APPROPRIATE APPROVALS AND OBTAINING PROPER BUSINESS CLEARANCES, AWARD OF THIS FIVE-YEAR, MULTI-YEAR CONTRACT WAS MADE TO BELL HELICOPTER COMPANY, THE LOW, RESPONSIVE, RESPONSIBLE BIDDER (TAB K), IN THE AMOUNT OF $123,086,645.55, WITH AN IMMEDIATE OBLIGATION OF $20,752,353.55 FOR THE FIRST PROGRAM YEAR. AFTER AWARD, A COPY OF A TWX, DATED 8 MARCH 1968 FROM ALVORD AND ALVORD, ATTORNEYS FOR HUGHES TOOL COMPANY, AIRCRAFT DIVISION, (TAB A), WAS DELIVERED TO THE CONTRACTING OFFICER. THE TWX WAS A COPY OF A PROTEST OF AWARD DIRECTED TO THE COMPTROLLER GENERAL. AN ADDENDUM TO THAT REPORT FURTHER STATES:

AS NOTED BY THE PROTESTANT IN THE INITIAL PORTION OF THE "REPLY.' WHEN THE PROCUREMENT WAS INITIATED THERE WERE THREE HELICOPTERS KNOWN TO THE GOVERNMENT THAT WERE FAA CERTIFIED UTILIZING THE APPROPRIATE ENGINE, AND WHICH COULD CONCEIVABLY MEET THE REQUIREMENTS OF THE RFTP. A REVIEW OF DATA AVAILABLE FROM FAA CERTIFICATION AND COMMERCIAL LITERATURE WHICH WAS AVAILABLE TO THE GENERAL PUBLIC REVEALED THAT NONE OF THE THREE AIRCRAFT WOULD MEET ALL THE REQUIREMENTS OF THE RFTP WITHOUT RECERTIFICATION. NATURALLY SINCE THE HUGHES OH-6A WAS IN PRODUCTION UNDER AN ARMY CONTRACT AND HAD NEVER BEEN PRODUCED COMMERCIALLY, THE CHANGES REQUIRED TO THIS AIRCRAFT TO MEET THE NEW MILITARY REQUIREMENTS WERE FEWER THAN THE CHANGES REQUIRED TO THE BELL MODEL 206A, A COMMERCIAL, PRODUCTION AIRCRAFT WHICH HAD NEVER BEEN MANUFACTURED FOR MILITARY USE. THE AREAS OF CHANGE REQUIRED TO THE HUGHES AIRCRAFT SUBMITTED FOR FLIGHT TEST TO CONFORM TO THE TECHNICAL PROPOSAL ARE LISTED IN THE ATTACHED STATEMENT OF THE CHAIRMAN, LOW SOURCE SELECTION EVALUATION BOARD. IT IS NOTED THAT 25 AREAS OF CHANGE WOULD HAVE BEEN REQUIRED TO THE MILITARIZED OH 6A HUGHES SUBMITTED FOR FLIGHT TEST TO MAKE IT CONFORM TO THE TECHNICAL PROPOSAL. FIFTY-FOUR AREAS OF CHANGE ARE REQUIRED TO THE BELL MODEL 206A TO MAKE IT CONFORM TO THE TECHNICAL PROPOSAL.

IN PERTINENT PART THE REQUEST FOR TECHNICAL PROPOSAL INCLUDING ITS TWO EXHIBITS (RFTP) PROVIDED THAT THE AIRCRAFT CONTEMPLATED FOR PROCUREMENT SHALL CONFORM TO THE GENERAL SPECIFICATION FOR LIGHT OBSERVATION HELICOPTER ATTACHED THERETO AS EXHIBIT I, AND THAT THE FIRST STEP OF THE INVITATION WOULD CONSIST OF THE RFTP, THE OFFERORS' RESPONSES TO THE REQUEST, EVALUATION BY THE GOVERNMENT, DISCUSSIONS OF TECHNICAL PROPOSALS TO DETERMINE THE ACCEPTABILITY OF THE PROPOSAL AND QUALIFYING FLIGHT TESTS OF THE OFFERORS' FAA CERTIFIED HELICOPTERS SUBMITTED TO THE ARMY FOR TESTING. IT FURTHER PROVIDED:

TECHNICAL PROPOSALS SUBMITTED UNDER STEP ONE MUST FULLY COMPLY, WITHOUT EXCEPTION, WITH REQUIREMENTS SET FORTH IN THIS "REQUEST FOR TECHNICAL PROPOSALS" AND THE ATTACHED EXHIBITS, AND AMENDMENTS THERETO IF ANY.

THE CRITERIA ESTABLISHED FOR GOVERNMENT EVALUATION OF THE AIRCRAFT REQUIREMENTS FOR TECHNICAL PROPOSALS, AND CONTRACTOR SUPPORT FOR TESTING ARE AS SET FORTH IN EXHIBIT I. THE REQUIREMENTS FOR DATA TO BE SUBMITTED WITH STEP I ARE SET FORTH IN EXHIBIT II.

IN STEP TWO OF THIS TWO-STEP INVITATION FOR BIDS, THE ONLY BIDS WHICH SHALL BE CONSIDERED FOR AWARD ARE THOSE WHICH ARE BASED ON TECHNICAL PROPOSALS DETERMINED TO BE ACCEPTABLE, EITHER INITIALLY OR AS MODIFIED AS A RESULT OF DISCUSSIONS, IF ANY, AND AIRCRAFT WHICH HAVE BEEN DETERMINED BY THE GOVERNMENT TO BE ACCEPTABLE DURING STEP ONE OF THIS IFB. FIRMS NOT SUBMITTING AN ACCEPTABLE TECHNICAL PROPOSAL DURING STEP ONE WILL NOT BE INVITED TO BID DURING STEP TWO.

IN THE FIRST STEP OF THE TWO-STEP PROCUREMENT, OFFERORS ARE AUTHORIZED AND ENCOURAGED TO SUBMIT MULTIPLE TECHNICAL PROPOSALS REPRESENTING DIFFERENT MODELS OF AIRCRAFT MEETING THE GENERAL SPECIFICATION AND OTHER REQUIREMENTS OF THIS INVITATION. EACH TECHNICAL PROPOSAL AND CORRESPONDING AIRCRAFT WILL BE SEPARATELY EVALUATED AND THE BIDDER WILL BE NOTIFIED AS TO ITS ACCEPTABILITY. VARIATIONS AND OPTIONAL ARRANGEMENTS FOR EACH BASIC AIRCRAFT SHOULD BE SET FORTH IN APPENDIX III OF THE DETAIL SPECIFICATION SUBMITTED FOR THAT AIRCRAFT.

EACH BIDDER SHALL PROVIDE FOR TESTING THE AIRCRAFT DESCRIBED IN HIS TECHNICAL PROPOSAL. * * *

EXCEPT AS SPECIFIED IN EXHIBIT I, PART A, PARAGRAPH 4.3.4, BIDDERS NOT SUBMITTING AN AIRCRAFT FOR TEST SHALL BE CONSIDERED NON-RESPONSIVE TO THIS IFB.

THE GENERAL SPECIFICATION (EXHIBITI) PROVIDED UNDER PARAGRAPH 1.3 OF PART A, REQUIREMENTS FOR TECHNICAL PROPOSALS, FOR THE LISTING OF PROPOSED DEVIATIONS TO SPECIFIC REQUIREMENTS OF THE SPECIFICATION AND RESERVED TO THE GOVERNMENT THE SOLE RIGHT TO DETERMINE THE ACCEPTABILITY OF DEVIATIONS BASED ON THE EFFECTS ON THE INTENDED MISSION, INCLUDING MAINTAINABILITY AND RELIABILITY PLUS OTHER FACTORS AS DEEMED APPROPRIATE BY THE GOVERNMENT. BIDDERS WERE REQUIRED TO SUBMIT A PERFORMANCE SUBSTANTIATING DATA REPORT IDENTIFYING EXTRAPOLATED OR ESTIMATED DATA, AND SUMMARIZING ANALYSIS METHODS USED IN PREDICTING PERFORMANCE CHARACTERISTICS REQUIRED BY THE GENERAL SPECIFICATION. IN ORDER TO VALIDATE PERFORMANCE AND HANDLING QUANLITIES OF THE PROPOSED HELICOPTER AND TO ASSURE THAT THE PROPOSED HELICOPTER WILL IN FACT PERFORM THE SPECIFIED MISSION, EACH OFFEROR WAS REQUIRED TO SUBMIT FOR GOVERNMENT FLIGHT TEST THE HELICOPTER GENERALLY DESCRIBED IN HIS TECHNICAL PROPOSAL. PARAGRAPH 4.1 PROVIDED, WITH CERTAIN EXCEPTIONS, THAT THE TEST HELICOPTER BE GENERALLY CONFIGURED FOR THE MISSION ROLE, AND INCORPORATE ALL SYSTEMS RELATIVE TO THE BASIC HANDLING QUALITIES AND PERFORMANCE CHARACTERISTICS OF THE PROPOSED HELICOPTER. PARAGRAPH 4.3 REQUIRED THE ESTABLISHMENT OF THE ADEQUACY OF THE HELICOPTER HANDLING QUALITIES WITH RESPECT TO THE INTENDED MISSION AND SPECIFICATION REQUIREMENTS, WHICH INCLUDE AN EVALUATION OF PROPOSED DEVIATIONS. A STATEMENT OF THE CRITERIA FOR GOVERNMENT EVALUATION OF TECHNICAL PROPOSALS WAS SET FORTH UNDER PARAGRAPH 5.0 AS FOLLOWS:

5.0 EVALUATION CRITERIA. THE ACCEPTABILITY OF SUBMITTED TECHNICAL PROPOSALS SHALL INCLUDE A COMPLETE ANALYTICAL AND ADMINISTRATIVE ANALYSIS OF ALL SUBMITTED DATA AS WELL AS RESULTS OF GOVERNMENT TESTS TO DETERMINE COMPLIANCE WITH THE REQUIREMENTS OF THE GENERAL SPECIFICATION AND THE CAPABILITY OF THE AIRCRAFT TO FULFILL THE INTENDED MISSION. DEVIATIONS TO SPECIFIC REQUIREMENTS WILL BE EVALUATED INDIVIDUALLY AND THE ACCEPTABILITY DETERMINED BY THE PROCURING ACTIVITY.

IN ADDITION, THE OVERALL MERITS OF THE SUBMITTED DATA AND DATA OBTAINED FROM GOVERNMENT TESTS SHALL BE THE BASIS FOR DETERMINING ACCEPTABILITY OF THE BIDDER'S PROPOSAL WITH RESPECT TO TECHNICAL RISK. FOR EXAMPLE, SHOULD, IN THE JUDGMENT OF THE GOVERNMENT, THE SCOPE OF MODIFICATIONS REQUIRED TO CORRECT DEFICIENCIES BE EXCESSIVE AND CAST REASONABLE DOUBT AS TO THE ABILITY OF THE MANUFACTURER TO DELIVER AND PRODUCE AIRCRAFT WITHIN REQUIRED SCHEDULES, THE TECHNICAL PROPOSAL INVOLVED MAY (BE) DEEMED UNACCEPTABLE ON THE BASIS OF TECHNICAL RISK.

THE FOLLOWING PROVISIONS CONCERNING FAA CERTIFICATION WERE INCLUDED IN THE GENERAL SPECIFICATION UNDER PART B, GENERAL SPECIFICATION AND REQUIREMENTS.

1.1.2 FEDERAL AVIATION AGENCY CERTIFICATION. THE BASIC HELICOPTER SHALL BE FAA TYPE CERTIFIED IN THE NORMAL CATEGORY UNDER FAR 27, FOR DAY OR NIGHT VFR OPERATION OF ROTORCRAFT.

NOTES:

1. AIRCRAFT PREVIOUSLY CERTIFIED UNDER CAM 6 WILL BE CONSIDERED ACCEPTABLE.

2. FAA CERTIFICATION OF THE BASIC AIRCRAFT AT A GROSS WEIGHT AT LEAST AS HIGH AS THE CONFIGURATION I MISSION WEIGHT DEFINED UNDER PARAGRAPH 3.1.3.3 OF THIS SPECIFICATION SHALL BE COMPLETED PRIOR TO SUBMISSION OF A TECHNICAL PROPOSAL FOR THIS PROCUREMENT. THE BASIC AIRCRAFT IS DEFINED TO INCLUDE THE PRIMARY AIRFRAME AS WELL AS MAJOR AIRCRAFT SYSTEMS AND SUBSYSTEMS (I.E. ROTOR SYSTEM AND DYNAMIC COMPONENTS, CONTROL SYSTEM, ETC.) BUT EXCLUDING SPECIAL MILITARY REQUIREMENTS OF THIS SPECIFICATION SUCH AS AVIONICS, ARMAMENT OR OTHER EQUIPMENT PECULIAR TO THE MILITARY CHARACTERISTICS OF THE HELICOPTER. THIS REQUIREMENT SPECIFICALLY PROHIBITS ACCEPTANCE OF A HELICOPTER NOT PREVIOUSLY FAA CERTIFIED AT A GROSS WEIGHT AS HIGH AS THE CONFIGURATION I MISSION WEIGHT BUT DOES NOT PROHIBIT MODIFICATION AND SUBSEQUENT RECERTIFICATION TO CORRECT MINOR DEFICIENCIES OR IN ADEQUACIES FOUND TO EXIST THROUGH GOVERNMENT EVALUATION, INCLUDING FLIGHT TESTS AND ANALYSIS, DURING STEP ONE OF THIS PROCUREMENT. CERTIFICATION OF MINOR MODIFICATIONS FOR EXPANSION OF THE FLIGHT ENVELOPE (I.E. SPEED, CEILINGS, C.G., RANGE, TRANSMISSION RATINGS, ETC.) AFTER SUBMISSION OF A TECHNICAL PROPOSAL IS PERMISSIBLE PROVIDED SUCH EXPANSIONS ARE FULLY SUBSTANTIATED WITH TECHNICAL DATA AND ANALYSIS.

1.1.3 REVISED TYPE CERTIFICATE. THE MANUFACTURER SHALL OBTAIN AND FURNISH TO THE PROCURING ACTIVITY 30 DAYS PRIOR TO GOVERNMENT ACCEPTANCE OF THE FIRST AIRCRAFT A REVISED TYPE CERTIFICATE OF THE PRODUCTION MODEL AIRCRAFT INCORPORATING CHANGES NECESSARY TO MEET THE REQUIREMENTS OF THIS GENERAL SPECIFICATION. PRODUCTION AIRCRAFT SHALL BE FAA CERTIFIED TO THE CONFIGURATION II MISSION GROSS WEIGHT AS DEFINED IN PARAGRAPH 3.1.3.3. THE EVENT REQUIREMENTS OF THIS SPECIFICATION PRECLUDE FAA CERTIFICATION OF SPECIFIC ITEMS, THE REQUIREMENTS OF THIS SPECIFICATION SHALL PREVAIL AND EXCEPTIONS TO FAA CERTIFICATION SHALL BE LISTED UNDER THIS PARAGRAPHAND PROVIDE THE GOVERNMENT VIA AN FAA FORM 970 FOR EACH DELIVERED AIRCRAFT.

NOTE: THE REQUIREMENT FOR A REVISED TYPE CERTIFICATE PERMITS ONLY CERTIFICATION OF MINOR MODIFICATIONS AFTER SUBMISSION OF A TECHNICAL PROPOSAL AND DOES NOT ALLEVIATE THE REQUIREMENT FOR FAA CERTIFICATION OF THE BASIC HELICOPTER PRIOR TO SUBMISSION OF A TECHNICAL PROPOSAL PER PARAGRAPH 1.1.2 ABOVE. ALL EQUIPMENT INSTALLATIONS AND REQUIREMENTS OF THIS IFB SHALL BE FAA CERTIFIED UNLESS A CONFLICT BETWEEN THESE REQUIREMENTS AND FAA REGULATIONS EXISTS (I.E. THE FAA DOES NOT CERTIFY ARMAMENT INSTALLATIONS).

ESSENTIALLY, YOUR PROTEST WAS ORIGINALLY SET OUT IN YOUR LETTER OF MARCH 18, 1968, AS FOLLOWS:

IT HAS ONLY RECENTLY BECOME KNOWN TO PROTESTANT THAT THE AIRCRAFT SUBMITTED FOR EVALUATION BY BELL HELICOPTER COMPANY, FORT WORTH, TEXAS (HEREINAFTER REFERRED TO AS "BELL"), WAS A STANDARD JET RANGER DEVELOPED BY BELL FOR THE COMMERCIAL MARKET. EXAMINATION OF THE JET RANGER, FAA- APPROVED FLIGHT MANUAL SHOWS THAT THE PERFORMANCE OF THE JET RANGER IS NOT ADEQUATE TO MEET THE REQUIREMENTS OF THE IFB. IN ORDER TO MEET THE REQUIREMENTS OF THE SPECIFICATION, THE FOLLOWING CHANGES WILL HAVE TO BE MADE:

1. INCREASE THE MAIN ROTOR DIAMETER BY APPROXIMATELY 2 FEET.

2. INCREASE THE TAIL BOOM LENGTH BY APPROXIMATELY 1 FOOT.

3. INCREASE THE LENGTH OF THE TAIL ROTOR DRIVE SHAFT BY APPROXIMATELY 1 FOOT.

4. CHANGE THE TRANSMISSION GEAR RATIO IN ORDER TO SLOW DOWN THE SPEED OF THE MAIN ROTOR.

IT IS OUR UNDERSTANDING THAT A HELICOPTER WITH THESE NECESSARY CHANGES WAS NOT IN FACT TESTED, ALTHOUGH SUCH CHANGES WOULD HAVE TO BE MADE IN THE HELICOPTER PROPOSED BY BELL.

THUS, THE HELICOPTER PROPOSED BY BELL IS A "PAPER" HELICOPTER. THE FURNISHING BY BELL AND THE TESTING BY THE ARMY OF A HELICOPTER MATERIALLY DIFFERENT FROM THAT PROPOSED BY BELL IN ITS TECHNICAL PROPOSAL MAKES THE ARMY AWARD TO BELL INVALID ON TWO GROUNDS.

1. THE BELL TECHNICAL PROPOSAL IS IN VIOLATION OF THE GENERAL SPECIFICATIONS AND REQUIREMENTS, PART B, MENTIONED ABOVE, BECAUSE THE "BASIC AIRCRAFT" WAS NOT CERTIFICATED IN A PROPER CONFIGURATION.

2. THE ARMY EVALUATION IS IN VIOLATION OF THE REQUIREMENTS FOR TECHNICAL PROPOSALS, PART A, MENTIONED ABOVE, BECAUSE THE IMPROPER CONFIGURATION OF THE AIRCRAFT SUBMITTED FOR TESTING PRECLUDED AN EVALUATION OF THE AIRCRAFT PROPOSED.

AS NOTED ABOVE, YOUR COUNSEL HAS BEEN FURNISHED COMPLETE COPIES OF THE CONTRACTING OFFICER'S REPORT ON YOUR PROTEST, AND THE ADDENDUM THERETO. IN YOUR REBUTTALS TO SUCH DOCUMENTS YOU HAVE TAKEN EXCEPTION TO VARIOUS ADMINISTRATIVE POSITIONS STATED THEREIN AND HAVE PRESENTED VARIOUS CONTENTIONS AND ARGUMENTS TO SUPPORT YOUR PROTEST. IT APPEARS FROM AN ANALYSIS OF THE BRIEFS OF RECORD THAT THE BASIC DIFFERENCE OF OPINION BETWEEN YOU AND THE ADMINISTRATIVE OFFICE CENTERS ON INTERPRETATION OF THE RFTP, AND CONCERNS THE TYPES OF MODIFICATIONS WHICH ARE AUTHORIZED, UNDER THE TERMS OF THE STEP-ONE SOLICITATION, TO BE MADE IN THE BASIC FAA CERTIFIED HELICOPTER EACH OFFEROR WAS REQUIRED TO SUBMIT FOR TESTING IN ORDER TO SUPPLY THE HELICOPTER REPRESENTED BY ITS TECHNICAL PROPOSAL. IS YOUR POSITION THAT THE TYPE OF MODIFICATIONS PERMITTED FOR EVALUATION OF THE TEST HELICPTER BY THE PROVISIONS OF THE SOLICITATION MUST EITHER EXCLUDE THOSE CHANGES WHICH ARE DEFINED AS "MAJOR" IN FAA REGULATIONS CONCERNING CERTIFICATION OF AIRCRAFT, OR BE LIMITED TO THOSE CHANGES WHICH WOULD BE REGARDED AS MINOR BY THOSE SCHOOLED IN THE HELICOPTER ART WHO WERE CALLED UPON TO REPLY TO THE RFTP. UNDER SUCH CRITERIA YOU CONTEND THE CHANGES REQUIRED IN THE BELL TEST HELICOPTER ARE MAJOR CHANGES, AND SUCH HELICOPTER THEREFORE DID NOT COMPLY WITH THE REQUIREMENTS OF PARAGRAPH 1.1.2. FURTHER, THAT THE ONLY EVALUATION OF TECHNICAL RISK CONTEMPLATED BY THE RFTP IS IN CONNECTION WITH INCORPORATION OF THE SPECIAL MILITARY REQUIREMENTS OF THE SPECIFICATIONS, AND NOT IN MODIFICATIONS OF THE TEST HELICOPTERS TO MEET OTHER PERFORMANCE REQUIREMENTS. IN OTHER WORDS, YOU MAINTAIN THAT THE AWARD TO BELL WAS IMPROPER ON THE BASIS THAT SUCH FIRM'S STEP-ONE PROPOSAL WAS, IN EFFECT, NONRESPONSIVE FOR THE REASON THAT BELL FAILED TO SUBMIT FOR TESTING A FAA CERTIFIED HELICOPTER WHICH DID NOT REQUIRE MAJOR CHANGES IN ITS PRIMARY AIRFRAME AND ROTOR SYSTEM IN ORDER TO COMPLY WITH THE PERFORMANCE SPECIFICATIONS, AND THAT ONE DOES NOT HAVE TO BE AN EXPERT OR A TECHNICIAN TO REALIZE AND COMPREHEND SUCH A SITUATION.

THE ADMINISTRATIVE POSITION IS THAT THE EVALUATION CRITERIA SET OUT IN THE SOLICITATION WITH RESPECT TO TECHNICAL RISK APPLIES TO THE TOTAL HELICOPTER PROPOSED, AND THAT IT IS EVIDENT FROM READING THE RFTP AS A WHOLE THAT THE MODIFICATIONS TO THE FAA CERTIFIED TEST HELICOPTER CONTEMPLATED BY PARAGRAPH 1.1.2 WERE THOSE MODIFICATIONS WHICH, IN THE GOVERNMENT'S JUDGMENT (FORMED ONLY AFTER EVALUATION OF ALL AVAILABLE DATA) DID NOT RENDER THE PROPOSAL UNACCEPTABLE. IN SUCH CONNECTION THE CONTRACTING OFFICER REPORTED:

THE GOVERNMENT CRITERIA FOR "MINOR" MODIFICATIONS OR INADEQUACIES WERE THOSE WHOSE ACCOMPLISHMENT OR CORRECTION, WHICH, IN THE JUDGMENT OF THE GOVERNMENT, INVOLVED AN ACCEPTABLE TECHNICAL RISK OF ACHIEVABILITY. IMPLICATION, A DEPARTURE FROM THE ALREADY ESTABLISHED FAA CERTIFIED AIRCRAFT WHICH WOULD, IN THE JUDGMENT OF THE GOVERNMENT, INVOLVE AN UNACCEPTABLE RISK OF REALIZATION WOULD NOT BE "MINOR" AND WOULD RENDER THE TECHNICAL PROPOSAL UNACCEPTABLE. THIS INTERPRETATION WAS THE ONE INTENDED AND ACTED UPON BY THE GOVERNMENT IN THE COURSE OF STEP I.

* * * THE CRITERIA INTENDED AND UTILIZED BY THE GOVERNMENT TO DETERMINE WHETHER A MODIFICATION REQUIRED TO BE MADE TO AN EXISTING FAA CERTIFIED AIRCRAFT WAS "MINOR" WAS THE DEGREE OF TECHNICAL RISK INTRODUCED THEREBY. IF THE SCOPE OF THE MODIFICATION WERE SUCH AS TO CAST REASONABLE DOUBT ON THE ACHIEVABILITY OF THE PROPOSAL OR ON THE ABILITY OF THE PROPOSED AIRCRAFT TO SATISFY GOVERNMENT REQUIREMENTS, THE MODIFICATION WOULD NOT BE "MINOR," AND THE PROPOSAL, THEREFORE, UNACCEPTABLE. TECHNICAL PERSONNEL OF THE GOVERNMENT WERE AWARE OF THE CHANGES REQUIRED IN THE FAA CERTIFIED BELL HELICOPTER COMPANY 206A IN ORDER FOR IT TO PERFORM AS PROPOSED, AND AFTER EVALUATION AND ANALYSIS DETERMINED THAT SUCH CHANGES OR MODIFICATIONS WERE MINOR. FURTHER, THE ARMY CATEGORICALLY REAFFIRMS THAT MODIFICATIONS WERE MINOR, THAT THE AIRCRAFT PROPOSED BY BELL HELICOPTER COMPANY FULLY MEETS THE NEEDS OF THE ARMY, AND THAT THE BELL HELICOPTER COMPANY PROPOSAL WAS ACCEPTABLE UNDER THE SPECIFICATIONS AS WRITTEN.

IT SHOULD BE EMPHASIZED THAT THE DETERMINATIONS BY THE GOVERNMENT AS TO WHAT IN FACT WERE ,MINOR" MODIFICATIONS ARE HIGHLY TECHNICAL IN NATURE. IMPLICIT ARE CONSIDERATIONS AS TO WHETHER ANY CHANGES IN A COMPLEX ITEM LIKE A HELICOPTER INVOLVED A HIGH OR LOW TECHNICAL RISK OF A BIDDER'S PROPOSED HELICOPTER, IF CONTRACTED FOR FOLLOWING STEP II, WILL SATISFY THE GOVERNMENT'S REQUIREMENT OR WILL BE TECHNICALLY ACHIEVABLE. * * *

WHILE YOU CONTEND THAT YOUR PROTEST DOES NOT INVOLVE A DISAGREEMENT BETWEEN THE GOVERNMENT'S AND YOUR TECHNICAL PERSONNEL, SUCH VIEW DOES NOT SEEM TO BE SHARED BY THE ADMINISTRATIVE OFFICE AS IS EVIDENCED BY THE FOLLOWING EXCERPT FROM THE ADDENDUM TO THE CONTRACTING OFFICER'S REPORT:

NOTWITHSTANDING THE PROTESTANT'S ASSERTATIONS TO THE CONTRARY ON PAGE 24 OF ITS "REPLY," IT APPEARS THAT COMMANDER TUCK AND MR. WEEKS HAVE TAKEN ISSUE WITH THE DETERMINATION OF GOVERNMENT PERSONNEL THAT THE MODIFICATIONS REQUIRED TO THE BELL SHIP WERE "MINOR" USING THE GOVERNMENT'S DEFINITION THEREOF. THE PROTESTANT, ON PAGE 8 OF ITS "REPLY," STATES THAT SUBMITTED TECHNICAL EVIDENCE, PRESUMABLY THE OPINIONS OF COMMANDER TUCK AND MR. WEEKS, STANDS FOR THE PROPOSITION THAT QUALIFIED PERSONNEL WOULD NOT UNDER ANY CIRCUMSTANCES CONSIDER THE CHANGES INCLUDED IN THE BELL PROPOSAL TO BE "MINOR.' WHILE IT IS DIFFICULT TO READ THE OPINIONS OF BOTH COMMANDER TUCK AND MR. WEEKS AS EXPLICITLY STANDING FOR THIS PROPOSITION, IT IS ASSUMED THAT THE PROTESTANT HAS CORRECTLY CHARACTERIZED THE OPINIONS HE HAS SUBMITTED. AS SET FORTH IN THE ADMINISTRATIVE REPORT, THE GOVERNMENT'S CRITERIA FOR "MINOR" INVOLVED THE DEGREE OF TECHNICAL RISK INTRODUCED THAT THE PROPOSAL WOULD BE ACHIEVABLE AND SATISFY THE GOVERNMENT'S REQUIREMENTS. AGAIN, AS OUTLINED IN THE ADMINISTRATIVE REPORT, THE GOVERNMENT, AFTER AN EXTENSIVE PROCESS, DETERMINED THE TECHNICAL RISK INVOLVED IN THE MODIFICATIONS TO BE MADE TO THE BELL SHIP TO BE MINIMAL AND ACCEPTABLE. THIS IS STILL THE TECHNICAL OPINION OF THE GOVERNMENT, AS ATTESTED TO BY THE ATTACHED OPINION OF THE CHAIRMAN OF THE LOH SOURCE SELECTION EVALUATION BOARD. IT MUST BE ASSUMED THAT THE PROTESTANT HAS STATED THAT COMMANDER TUCK AND MR. WEEKS WOULD NOT REGARD THE MODIFICATIONS TO BE MADE TO THE BELL SHIP AS MINOR IN ANY CIRCUMSTANCE; OBVIOUSLY, THESE EXPERTS MUST BE STATING THAT THE MODIFICATIONS COULD NOT BE MINOR EVEN UNDER THE GOVERNMENT'S CRITERIA OF TECHNICAL RISK. ADMITTEDLY, THE TECHNICAL EXPERTS WHOSE OPINIONS WERE SUBMITTED BY THE PROTESTANT HAVE NOT DIRECTLY STATED THAT THE DEGREE OF TECHNICAL RISK WAS EXCESSIVE. INSTEAD, THESE EXPERTS AND THE PROTESTANT HAVE APPROACHED THE PROBLEM AS IF THE TECHNICAL ISSUE IN QUESTION WERE THE DEFINITION OF "MINOR.' IT IS SUBMITTED THAT THIS IS NOT THE CASE. THE CRITERIA BY WHICH MODIFICATIONS WERE TO BE JUDGED "MINOR" WAS CONTAINED IN THE RFTP; THAT CRITERIA CONCERNED TECHNICAL RISK. APPLICATION OF THE CRITERIA, I.E., THE AMOUNT OF TECHNICAL RISK INTRODUCED AND WHETHER THE EXTENT IS ACCEPTABLE IN LIGHT OF THE REQUIREMENTS OF THE GOVERNMENT IS A TECHNICAL QUESTION, AND THE ONLY TECHNICAL ISSUE INVOLVED IN THIS PROTEST.

WHILE THE PROTESTANT'S TECHNICAL EXPERTS HAVE NOT DIRECTLY TAKEN ISSUE WITH THE GOVERNMENT'S APPLICATION OF THE CRITERIA OF MINOR CONTAINED IN THE RFTP, TO THE EXTENT THAT THEY AND THE PROTESTANT HAVE IMPLIEDLY TAKEN ISSUE WITH GOVERNMENT'S DETERMINATION BY STATING THE MODIFICATIONS REQUIRED BY THE BELL PROPOSAL COULD NEVER BE MINOR, THE GOVERNMENT MUST TAKE ISSUE. IT IS SUBMITTED THAT THE GOVERNMENT'S DETERMINATION THAT THE BELL PROPOSAL INVOLVED AN ACCEPTABLE DEGREE OF TECHNICAL RISK SHOULD BE ACCEPTED. ONLY THE GOVERNMENT AND ITS PERSONNEL WERE IN POSSESSION OF THE DATA GENERATED IN THE FIRST STEP AND ON WHICH THE DECISION WAS MADE. SUCH A DECISION, MADE ONLY AFTER AN EXTENSIVE EVALUATION PROCESS AND RE- ADFIRMED BY THE ADMINISTRATIVE REPORT AND THIS ADDENDUM SHOULD NOT BE OVERTURNED.

AS STATED IN THE CONTRACTING OFFICER'S REPORT, THE TWO-STEP FORMAL ADVERTISING METHOD OF PROCUREMENT WAS SELECTED IN AN EFFORT TO PROMOTE AND SEEK MAXIMUM COMPETITION, AND THE RFTP WAS DRAFTED WITH THE VIEW OF AVOIDING ANY UNNECESSARILY RESTRICTIVE STATEMENTS OF THE GOVERNMENT'S REQUIREMENTS WHICH WOULD UNDULY LIMIT THE COMPETITION. IT IS FURTHER STATED THAT THE PROCURING ACTIVITY WAS AWARE OF, AND ACCEPTED, THE FACT THAT THE THREE KNOWN POTENTIAL BIDDERS WOULD HAVE TO MODIFY THEIR EXISTING FAA CERTIFIED HELICOPTERS TO REACH THE PERFORMANCE AND OTHER REQUIREMENTS OF THE SPECIFICATIONS. WE CANNOT CONCLUDE, NOR DO YOU CONTEND, THAT THE TWO-STEP METHOD OF FORMAL ADVERTISING WAS IMPROPERLY SELECTED FOR THE PROCUREMENT.

IN PARAGRAPH 2-501 OF THE ARMED SERVICES PROCUREMENT REGULATION TWO STEP FORMAL ADVERTISING IS DESCRIBED AS A FLEXIBLE PROCEDURE, ESPECIALLY USEFUL IN THE PROCUREMENT OF COMPLEX ITEMS REQUIRING TECHNICAL PROPOSALS. "CONFORMITY TO THE TECHNICAL REQUIREMENTS" IS RESOLVED IN STEP ONE, WHICH INCLUDES THE EVALUATION AND, IF NECESSARY, DISCUSSION OF TECHNICAL PROPOSALS TO DETERMINE THEIR ACCEPTABILITY. SUCH METHOD REQUIRES THAT THE CONTRACTING OFFICER WORK CLOSELY WITH TECHNICAL PERSONNEL AND THAT HE UTILIZE THEIR SPECIALIZED KNOWLEDGE IN DETERMINING THE TECHNICAL REQUIREMENTS OF THE PROCUREMENT, IN DETERMINING THE CRITERIA TO BE USED IN EVALUATING TECHNICAL PROPOSALS, "AND IN MAKING SUCH EVALUATION.' THE CONDITIONS SET OUT IN ASPR 2-502 (A) FOR USE OF TWO-STEP FORMAL ADVERTISING INCLUDE THE SITUATION WHEN AVAILABLE SPECIFICATIONS MAY BE TOO RESTRICTIVE TO PERMIT FULL AND FREE COMPETITION WITHOUT TECHNICAL EVALUATION, AND WHEN DEFINITE CRITERIA, SUCH AS PERFORMANCE REQUIREMENTS, EXIST FOR EVALUATING TECHNICAL PROPOSALS. TECHNICAL EVALUATION OF A PROPOSAL IS REQUIRED TO BE BASED UPON THE CRITERIA CONTAINED IN THE RFTP, AND A PROPOSAL WHICH MODIFIES, OR FAILS TO CONFORM TO THE "ESSENTIAL" REQUIREMENTS, OR SPECIFICATIONS OF, THE RFTP SHALL BE CONSIDERED NONRESPONSIVE AND CATEGORIZED AS UNACCEPTABLE. FROM SUCH PROVISIONS AND OUR REPEATED RECOGNITION OF THOSE PROVISIONS IN A LONG LINE OF DECISIONS, WE DO NOT BELIEVE IT CAN BE SERIOUSLY CONTENDED THAT THE EVALUATION OF TECHNICAL PROPOSALS AND THE DETERMINATION OF THEIR ACCEPTABILITY OR UNACCEPTABILITY ARE NOT MATTERS WHICH REQUIRE THE EXPERT JUDGMENT OF TECHNICAL PERSONNEL, AND IT IS WELL SETTLED THAT SUCH DETERMINATIONS ARE PRIMARILY THE RESPONSIBILITY OF THE PROCURING AGENCY. IT IS EQUALLY WELL ESTABLISHED THAT WE WILL NOT QUESTION THE TECHNICAL CONCLUSIONS OF THE ADMINISTRATIVE EXPERTS UNLESS THERE IS CLEAR EVIDENCE OF FRAUD, ABUSE OF AUTHORITY OR ARBITRARY ACTION.

FROM OUR ANALYSIS OF THE RFTP, WE BELIEVE THE ONLY PROPOSALS WHICH WOULD BE SUBJECT TO SUMMARY REJECTION AS NONRESPONSIVE WITHOUT TECHNICAL EVALUATION UNDER THE RFTP TERMS WERE THOSE WHICH DID NOT PROVIDE A HELICOPTER FOR TESTING AND WAIVER THEREOF HAD NOT BEEN GRANTED, OR WHICH INCLUDED A HELICOPTER FOR EVALUATION THAT HAD NOT BEEN PREVIOUSLY FAA CERTIFIED AT A GROSS WEIGHT AT LEAST AS HIGH AS THE CONFIGURATION I MISSION WEIGHT. NEITHER TYPE IS REPRESENTED HERE. WHILE PARAGRAPH 1.1.2, SPECIFICALLY PROHIBITS ACCEPTANCE OF A HELICOPTER WHICH HAD NOT BEEN SO CERTIFIED, IT ALSO PROVIDES THAT THE REQUIREMENT DOES NOT PROHIBIT MODIFICATION AND SUBSEQUENT RECERTIFICATION TO CORRECT MINOR DEFICIENCIES OR INADEQUACIES "FOUND TO EXIST THROUGH GOVERNMENT EVALUATION," INCLUDING FLIGHT TEST AND ANALYSIS, DURING STEP ONE OF THE PROCUREMENT.

ALTHOUGH IT MAY BE, AS YOU CONTEND, THAT THE MODIFICATIONS REQUIRED IN THE AIRFRAME AND ROTOR SYSTEM OF THE MODEL 206A JET RANGER HELICOPTER SUBMITTED BY BELL FOR TESTING WERE NOT "MINOR" UNDER FAA CERTIFICATION REGULATIONS, AND SUCH MODIFICATIONS WOULD ORDINARILY NOT BE REGARDED AS MINOR BY THOSE SCHOOLED IN THE HELICOPTER ART, THE RFTP DOES NOT STATE THAT THE FAA DEFINITION OF CHANGES IS FOR APPLICATION NOR DOES IT DEFINE THE TYPE OR EXTENT OF THE MODIFICATIONS TO THE TEST HELICOPTER THAT ARE CONTEMPLATED. WHILE WE ARE INCLINED TO AGREE THAT SUCH USE OF THE WORK ,MINOR" SHOULD ORDINARILY BE CONSIDERED AS INDICATING THOSE CHANGES OR MODIFICATIONS IN THE TEST HELICOPTER WHICH WOULD BE REGARDED AS MINOR BY INDUSTRY STANDARDS, RECOGNITION MUST BE GIVEN TO THOSE SPECIFIC PROVISIONS OF THE RFTP WHICH SHOW THAT THE TYPE OF ACCEPTABLE MODIFICATIONS OR DEVIATIONS ENVISIONED WERE THOSE WHICH, UPON EVALUATION BY THE GOVERNMENT, WERE CONSIDERED TECHNICALLY ACCEPTABLE IN RELATION TO THE MISSION REQUIREMENTS.

WE BELIEVE THAT THE RFTP, WHEN VIEWED IN ITS ENTIRETY, LOGICALLY APPRISED PROSPECTIVE CONTRACTORS OF THE GOVERNMENT'S NEED FOR HELICOPTERS MEETING SPECIFIED PERFORMANCE AND OTHER MISSION REQUIREMENTS, AND THAT AN OFFEROR MUST FURNISH WITH HIS TECHNICAL PROPOSAL THE FAA CERTIFIED HELICOPTER ON WHICH HIS PROPOSAL IS BOTTOMED, TOGETHER WITH A LISTING OF PROPOSED MODIFICATIONS THERETO WHICH THE OFFEROR CONSIDERED NECESSARY OR DESIRABLE IN MEETING THE MISSION REQUIREMENTS. PROSPECTIVE CONTRACTORS WERE FURTHER ADVISED THAT PROPOSED MODIFICATIONS TO THE TEST HELICOPTER, AS WELL AS PROPOSED DEVIATIONS TO SPECIFIC REQUIREMENTS OF THE RFTP, WERE PERMISSIBLE AND WOULD BE EVALUATED BY THE GOVERNMENT TO DETERMINE THEIR ACCEPTABILITY. THAT SUCH EVALUATION WOULD INCLUDE THE TECHNICAL RISK INVOLVED IN THE OFFEROR'S OVERALL PROPOSAL, INCLUDING PROPOSED MODIFICATIONS TO THE TEST HELICOPTER, IS CLEARLY INDICATED BY PARAGRAPH 5.0, AS QUOTED ABOVE.

THE RFTP ALSO PROVIDED FOR USE OF EXTRAPOLATED AND ESTIMATED DATA IN PREDICTING PERFORMANCE CHARACTERISTICS REQUIRED BY THE SPECIFICATIONS, AND THE PRESENTATION OF SUMMARY CALCULATIONS USED IN DEVELOPING ESTIMATED AND GUARANTEED PERFORMANCE. THE RFTP CLEARLY EVIDENCES THAT THE RESPONSIVENESS AND ACCEPTABILITY OF A TECHNICAL PROPOSAL ON THE ULTIMATE HELICOPTER TO BE DELIVERED WAS TO BE DEPENDENT UPON THE GOVERNMENT'S EVALUATION OF ALL SUBMITTED MATERIAL, INCLUDING EXTRAPOLATED AND ESTIMATED DATA, PROPOSED MODIFICATIONS AND DEVIATIONS, AND THAT THE ACCEPTABILITY OF A PROPOSAL WAS NOT TO BE DEPENDENT UPON SUBMISSION OF A HELICOPTER WHOSE FINAL PERFORMANCE CHARACTERISTICS AND FULFILLMENTS OF MISSION REQUIREMENTS COULD BE DETERMINED SOLELY FROM ACTUAL TESTING OF THAT HELICOPTER.

WHILE PARAGRAPH 1.1.2 AUTHORIZED MODIFICATION OF THE TEST HELICOPTER TO CORRECT ONLY MINOR DEFICIENCIES OR INADEQUACIES FOUND TO EXIST THROUGH GOVERNMENT EVALUATION, WE BELIEVE THE WORD ,MINOR" MUST BE REGARDED AS HAVING BEEN USED IN A FLEXIBLE SENSE RELATING TO THE GOVERNMENT'S EVALUATION OF THE ACCEPTABILITY OF THE MODIFICATION IN RELATION TO THE MISSION REQUIREMENTS AND THE DEGREE OF TECHNICAL RISK INVOLVED. BELIEVE THIS VIEW IS CONSISTENT WITH THE GOVERNMENT'S STATED REQUIREMENTS, AND THE COMPETITIVE PURPOSE OF THE RFTP AS WELL AS THE GENERAL LANGUAGE USED THEREIN WHICH PRECLUDES THE ATTACHMENT OF RIGID OR UNDULY RESTRICTIVE INTERPRETATIONS TO THE PROCURING ACTIVITY'S USE OF THE WORD "MINOR" IN DRAFTING PARAGRAPH 1.1.2.

IN SUMMARY, THE RFTP SPECIFICALLY PROVIDED FOR GOVERNMENT EVALUATION OF MODIFICATIONS IN THE TEST HELICOPTER SUBMITTED WITH EACH TECHNICAL PROPOSAL. GOVERNMENT TECHNICIANS EVALUATED THE PROPOSAL SUBMITTED BY BELL, INCLUDING THE MODIFICATIONS PROPOSED IN THAT FIRM'S TEST HELICOPTER, THE JET RANGER, AND UPON DETERMING THAT THE MODIFICATIONS THERETO INTRODUCED ONLY MINOR TECHNICAL RISK AND DID NOT CAST REASONABLE DOUBT ON THE ACHIEVABILITY OF THE PROPOSAL, THE GOVERNMENT TECHNICIANS CONCLUDED THAT BELL'S PROPOSAL WAS ACCEPTABLE. WE DO NOT FIND IN THE RECORD BEFORE US ANY PROPER GROUNDS FOR THIS OFFICE TO REJECT THE TECHNICAL JUDGMENT OF THE ADMINISTRATIVE EXPERTS AS TO THE ACCEPTABILITY OF BELL'S PROPOSAL, NOR DO WE BELIEVE THAT THE RECORD SUPPORTS ANY OTHER POINT IN YOUR PROTEST UPON WHICH THE AWARD TO BELL COULD BE HELD CLEARLY ILLEGAL.

WHILE YOUR COUNSEL HAS CITED SEVERAL DECISIONS OF OUR OFFICE STRESSING THE NECESSITY FOR BIDS TO RESPOND FULLY TO THE REQUIREMENTS OF THE INVITATION, SO THAT THE CONTRACT AWARDED WILL BE THE SAME CONTRACT OFFERED TO ALL BIDDERS, WE HAVE NOT APPLIED THOSE STRICT RULES TO THE EVALUATION OF PROPOSALS SUBMITTED IN THE FIRST STEP OF THE TWO-STEP PROCUREMENT PROCEDURE. ACCOMPLISHMENT OF THE STATED OBJECTIVES OF THIS METHOD REQUIRES A CONSIDERABLE ELEMENT OF FLEXIBILITY, AND TO THIS END THE REGULATIONS SPECIFICALLY PROVIDE FOR DISCUSSIONS WITH ANY OFFEROR OF HIS PROPOSAL, MAKING THE FIRST-STEP EVALUATION PROCEDURE MORE IN THE NATURE OF NEGOTIATED PROCUREMENT THAN OF STRICT FORMAL ADVERTISING.

ON THE RECORD OF THE SUBJECT PROCUREMENT WE ARE UNABLE TO SEE ANY REASON WHY THE ACTION TAKEN WAS PREJUDICIAL TO YOU, SINCE YOUR PROPOSAL ALSO WAS FOUND ACCEPTABLE, AND THERE IS NO INDICATION THAT YOU WOULD HAVE MADE ANY SUBSTANTIAL MODIFICATIONS THEREOF IF YOU HAD BEEN ADVISED OF THE AGENCY'S INTERPRETATION.

ACTION BY THIS OFFICE TO EFFECT CANCELLATION OF BELL'S CONTRACT, AS YOU REQUEST, MAY BE TAKEN ONLY UPON A CONCLUSION THAT THE AWARD WAS SO CLEARLY INVALID THAT A COURT OF COMPETENT JURISDICTION WOULD DECLARE THE CONTRACT A NULLITY. WE CANNOT FIND ANY BASIS TO SUPPORT SUCH A CONCLUSION WITH RESPECT TO THE SUBJECT AWARD.