B-164670, AUG. 30, 1968

B-164670: Aug 30, 1968

Additional Materials:

Contact:

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

 

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

NEESON INTERNATIONAL CORPORATION: REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 24. THE SERVICES IN QUESTION ARE COVERED BY CONTRACT NO. THE SUBSTANCE OF YOUR PROTEST IS THAT ALTHOUGH YOU CONSIDER YOURSELF FULLY QUALIFIED TO PROVIDE THE SERVICES IN QUESTION. YOU CLAIM THAT COMPETITION COULD HAVE BEEN EMPLOYED AND AWARD CONDITIONED ON AVAILABILITY OF FUNDS PURSUANT TO ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1-318. YOU CONTEND THAT DEFERMENT OF THE EXTENSION UNTIL FUNDS WERE AVAILABLE CREATED THE EXIGENCY WHICH PRECLUDED COMPETITION. WAGE RATES WHICH WERE EXACTLY $1 LESS THAN LSI CURRENT CONTRACT RATES REFLECTED IN DOCUMENTS WHICH AVCOM HAD MADE AVAILABLE TO YOU IN JANUARY 1968 AFTER YOU EXPRESSED INTEREST IN THE SERVICES.

B-164670, AUG. 30, 1968

TO BARTON'S AIR TRAFFIC CONTROL SPECIALISTS, INC. AND NEESON INTERNATIONAL CORPORATION:

REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 24, 1968, AS SUPPLEMENTED BY A TELEGRAM OF JULY 3 AND BY VARIOUS LETTERS, PROTESTING AGAINST THE SOLE SOURCE PROCUREMENT BY THE DEPARTMENT OF THE ARMY OF AIR TRAFFIC CONTROL SERVICES IN VIETNAM FROM LSI SERVICE CORPORATION (LSI).

THE SERVICES IN QUESTION ARE COVERED BY CONTRACT NO. DA 23-204-AMC 04023/T), A BASIC ORDERING AGREEMENT, DATED MARCH 19, 1966, AS IMPLEMENTED BY DELIVERY ORDERS, ISSUED BY THE UNITED STATES ARMY AVIATION MATERIEL COMMAND (AVCOM), PURSUANT TO THE NEGOTIATION AUTHORITY IN 10 U.S.C. 2304 (A) (6) PERTAINING TO PURCHASES OUTSIDE THE UNITED STATES. AVCOM HAS EXTENDED THE CONTRACT TWICE; FIRST, FOR A PERIOD OF 4-1/2 MONTHS, FROM MARCH 7, 1968, THROUGH JULY 15, 1968, AND, SECOND, FOR A PERIOD OF 12 MONTHS, EFFECTIVE JULY 16, 1968.

THE SUBSTANCE OF YOUR PROTEST IS THAT ALTHOUGH YOU CONSIDER YOURSELF FULLY QUALIFIED TO PROVIDE THE SERVICES IN QUESTION, AVCOM HAS DISREGARDED TWO PROPOSALS WHICH YOU SUBMITTED, ONE ON FEBRUARY 13, 1968, AND ONE ON JULY 1, 1968, OFFERING TO PERFORM THE SERVICES AT LOWER COST THAN LSI. WITH SPECIFIC REFERENCE TO THE SECOND EXTENSION, YOU CLAIM THAT COMPETITION COULD HAVE BEEN EMPLOYED AND AWARD CONDITIONED ON AVAILABILITY OF FUNDS PURSUANT TO ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1-318, THUS PROVIDING SUFFICIENT TIME FOR EVALUATION OF YOUR PROPOSAL AND CONSIDERATION OF YOUR CAPABILITIES. ACCORDINGLY, YOU CONTEND THAT DEFERMENT OF THE EXTENSION UNTIL FUNDS WERE AVAILABLE CREATED THE EXIGENCY WHICH PRECLUDED COMPETITION.

THE RECORD INDICATES THAT THE PROPOSAL WHICH YOU SUBMITTED ON FEBRUARY 13, 1968, SHOWED, WITH ONE EXCEPTION, WAGE RATES WHICH WERE EXACTLY $1 LESS THAN LSI CURRENT CONTRACT RATES REFLECTED IN DOCUMENTS WHICH AVCOM HAD MADE AVAILABLE TO YOU IN JANUARY 1968 AFTER YOU EXPRESSED INTEREST IN THE SERVICES. NO SUPPORTING COST DATA WAS SUPPLIED BY YOU WITH THE PROPOSAL. AN ATTACHMENT TO SUCH PROPOSAL STATED THAT PROJECT TEAM MEMBERS WOULD BE SELECTED FROM YOUR EXCLUSIVE ROSTER OF MORE THAN 125 AIR TRAFFIC CONTROL SPECIALISTS. A BIDDER'S MAILING LIST APPLICATION, WHICH YOU EXECUTED ON FEBRUARY 15, 1968, STATED THAT YOU HAD 125 QUALIFIED APPLICANTS FOR AIR TRAFFIC CONTROLLER SERVICE. HOWEVER, A PROGRESS LETTER DATED FEBRUARY 19, 1968, WHICH YOU DISTRIBUTED TO LSI PERSONNEL CONTRARY TO ARMY DIRECTIVES PRECLUDING PROSELYTING OF CURRENT CONTRACTOR PERSONNEL IN VIETNAM, STATED THAT YOU OFFICIALLY BECAME A CORPORATION ON FEBRUARY 13, 1968, AND WERE SOLICITING THEIR APPLICATIONS FOR EMPLOYMENT WITH YOUR ORGANIZATION.

AS TO THE FIRST EXTENSION OF THE LSI CONTRACT, THE CONTRACTING OFFICER REPORTS THAT THE CONFIDENTIAL MESSAGE DIRECTING THE EXTENSION FOR 4-1/2 MONTHS WAS NOT RECEIVED BY AVCOM UNTIL FEBRUARY 5, 1968, THUS RESTRICTING THE TIME FOR COMPLIANCE THEREWITH. ACCORDINGLY, AND ON THE BASIS THAT THE MESSAGE WAS DIRECTORY IN NATURE, YOU WERE NOT CONSIDERED AN ALTERNATIVE SOURCE.

AS TO THE SECOND EXTENSION, THE CONTRACTING OFFICER STATES THAT IN JANUARY 1968, WHEN YOU FIRST APPROACHED AVCOM ABOUT THE SERVICES, THE CONTRACTING OFFICER WAS UNAWARE THAT THE ARMY WOULD HAVE A REQUIREMENT FOR CIVILIAN AIR TRAFFIC CONTROLLERS BEYOND JULY 15, 1968, SINCE FOR SOME TIME THE ARMY HAS DESIRED TO REPLACE THE CIVILIAN PERSONNEL WITH MILITARY AIR TRAFFIC CONTROLLERS, AS EVIDENCED BY THE ACTION NOW BEING TAKEN BY THE ARMY TO REDUCE THE NUMBER OF CIVILIAN AIR TRAFFIC CONTROL PERSONNEL SERVING UNDER THE LSI CONTRACT AND THE NUMBER OF STATIONS OPERATED UNDER CONTRACT. IN ADDITION, THE CONTRACTING OFFICER STATES THAT HE DID NOT HAVE A COMPLETE PROCUREMENT PACKAGE UNTIL JUNE 3, 1968, WHEN HE RECEIVED ADVICE OF THE 1969 FISCAL YEAR WORK REQUIREMENT. THE 43 DAYS WHICH THEREAFTER REMAINED UNTIL JULY 15, 1968, THE EXPIRATION DATE OF THE FIRST EXTENSION, IT IS STATED, WERE NOT SUFFICIENT TO ACCOMPLISH SOLICITATION OF OTHER SOURCES, PREPARATION OF PROPOSALS BY THE SOLICITED SOURCES, EVALUATION OF THE PROPOSALS RECEIVED, NEGOTIATION WITH ALL COMPETITIVE OFFERORS, AND AWARD AND CLEARANCE AND TRANSPORTATION OF CONTRACTOR PERSONNEL TO VIETNAM.

AS TO THE MATTER OF YOUR LOW PRICE, THE CONTRACTING OFFICER STATES THAT AS OF JULY 24, 1968, YOU HAD FAILED TO COMPLY WITH THE CONTRACTING OFFICER'S REQUEST FOR A RATE BREAKDOWN.

WITH RESPECT TO THE FACTOR OF YOUR CAPABILITY, THE CONTRACTING OFFICER POINTS OUT THAT BARTON'S HAS NO PREVIOUS EXPERIENCE IN THE FIELD, NOT HAVING BEEN INCORPORATED UNTIL FEBRUARY 13, 1968, AND THAT THE JOINT VENTURE HAS NOT DEMONSTRATED THE NECESSARY CAPABILITY BY OTHER THAN ITS UNSUBSTANTIATED WORD. FURTHER, IF THE JOINT VENTURE WERE TO BE AWARDED THE CONTRACT, IT IS STATED THAT IT WOULD BE NECESSARY TO RETAIN THE CURRENT CONTRACTOR TO TRAIN YOUR PERSONNEL FOR A WEEK, RESULTING IN DOUBLE COST TO THE GOVERNMENT. CONVERSELY, IT IS STATED, LSI HAS EXPERIENCED PERSONNEL ON SITE AND THERE WILL BE NO BREAK IN THE OPERATION. SUCH FACTORS, IT IS URGED, WOULD ALSO BE FOR CONSIDERATION IF LSI WERE RETAINED FOR ONLY A LIMITED TIME TO PROVIDE TIME FOR THE TRAVEL OF YOUR CONTROLLERS TO THE CONTRACT PERFORMANCE SITE, AS YOU HAVE SUGGESTED. IN ADDITION IT IS STATED THAT A CHANGE OF CONTRACTORS WOULD REQUIRE CONSIDERATION OF THE FACTORS OF SAFETY OF THE AVIATORS, THE EQUIPMENT WHICH IS NOW IN USE, AND THE CONFIDENCE THE AVIATORS HAVE IN THE PRESENT CONTROLLERS.

REGARDING YOUR COMPLAINT THAT AVCOM DID NOT GIVE YOU A STATEMENT OF WORK PACKAGE, THE CONTRACTING OFFICER REPORTS THAT SUCH PACKAGE IS CLASSIFIED "CONFIDENTIAL" AND IS THEREFORE NOT AVAILABLE TO YOU AS A MEMBER OF THE PUBLIC. WITH SPECIFIC REFERENCE TO YOUR STATEMENTS CONCERNING AVCOM'S CONDUCT OF THE PROCUREMENT AND ITS FAILURE TO DISCLOSE VITAL INFORMATION TO YOU AS A LEGITIMATE OFFEROR, THE CONTRACTING OFFICER STATES THAT YOU WERE NEVER REGARDED AS A LEGITIMATE OFFEROR TO WHOM CLASSIFIED MATERIAL COULD BE DISCLOSED.

AS TO THE USE OF COMPETITION IN FUTURE PROCUREMENTS, THE RECORD SHOWS THAT THE UNITED STATES ARMY AERONAUTICAL SERVICES HAS ALREADY BEEN REQUESTED BY AVCOM TO TAKE NECESSARY ADVANCE PLANNING ACTION TO ENABLE AVCOM TO PREPARE A COMPETITIVE SOLICITATION FOR THE FISCAL YEAR 1970.

IN ADDITION TO THE FACTORS STRESSED BY THE CONTRACTING OFFICER IN SUPPORT OF NEGOTIATION WITH LSI ONLY, THE DEPARTMENT OF THE ARMY MAKES THE OBSERVATION THAT, ASSUMING THE AVAILABILITY OF ALTERNATIVE SOURCES FOR THE SERVICES, IT WOULD HAVE BEEN NECESSARY FOR THE PERSONNEL OF ANY OTHER CONTRACTOR TO TRAVEL TO VIETNAM. SUCH TRAVEL, IT IS STATED, COULD NOT HAVE BEEN ACCOMPLISHED UNTIL FUNDS WERE MADE AVAILABLE FOR THE PROCUREMENT. SINCE THE FUNDS IN THIS CASE WERE NOT MADE AVAILABLE FOR THE SECOND EXTENSION UNTIL JULY 12, 1968, ONLY THREE DAYS BEFORE THE EXPIRATION OF THE FIRST EXTENSION, IT IS STATED THAT AWARD TO A NEW CONTRACTOR WOULD HAVE GIVEN RISE TO A LAPSE IN SERVICES WHICH COULD NOT BE TOLERATED.

ASPR 3-206.2, PERTAINING TO NEGOTIATION UNDER 10 U.S.C. 2304 (A) (6), PROHIBITS THE USE OF FORMAL ADVERTISING FOR PROCUREMENT OF SUPPLIES OR SERVICES UNDER SUCH AUTHORITY. ACCORDINGLY, WE ARE CONCERNED HERE ONLY WITH THE QUESTION OF WHETHER THE NEGOTIATION SHOULD HAVE BEEN COMPETITIVE.

UNDER ASPR 3-410.2, THE ISSUANCE OF AN ORDER AGAINST A BASIC ORDERING AGREEMENT, WHICH IS NOT A CONTRACT IN ITSELF, IS AUTHORIZED ONLY UPON DETERMINATION AT THE TIME THE ORDER IS PLACED THAT IT IS IMPRACTICABLE TO OBTAIN COMPETITION FOR THE PROCUREMENT OF THE SUPPLIES OR SERVICES.

THE REPORTED FACTS EVIDENCE THAT CONTINUITY OF THE SERVICES IN QUESTION WAS REQUIRED IN THE GOVERNMENT'S INTEREST; THAT A CONSIDERABLE PERIOD OF TIME WOULD HAVE BEEN NEEDED TO QUALIFY A CONTRACTOR WHO HAD NOT PREVIOUSLY PERFORMED SUCH SERVICES; THAT THE LATENESS OF THE FUNDING OF THE PROGRAM PRECLUDED TIMELY TRAVEL OF NEW CONTRACTOR PERSONNEL TO THE PLACE OF CONTRACT PERFORMANCE, ASSUMING THAT QUALIFIED SOURCES MIGHT HAVE BEEN AVAILABLE, IN ORDER TO ASSUME THE WORK WITHOUT INTERRUPTION; AND THAT THE CONFIDENTIAL NATURE OF THE PROCUREMENT PRECLUDED PUBLICITY OF THE REQUIREMENT OR DISTRIBUTION OF PROCUREMENT INFORMATION TO SOURCES WHICH HAD NOT BEEN CLEARED FOR RECEIPT OF CLASSIFIED INFORMATION. IN THE LIGHT OF SUCH FACTORS, WE CANNOT CONCLUDE ON THE BASIS OF THE RECORD BEFORE OUR OFFICE THAT AVCOM'S DECISION TO ISSUE THE DELIVERY ORDERS TO LSI RATHER THAN TO SOLICIT COMPETITION WAS NOT A PROPER DETERMINATION UNDER ASPR 3 410.2. IN THE CIRCUMSTANCES, WE FIND NO LEGAL BASIS TO QUESTION THE EXTENSION OF THE LSI CONTRACT FOR THE PERIODS INVOLVED.