B-164776, AUG. 12, 1968

B-164776, AUG. 12, 1968

TO AMBAC INDUSTRIES, INCORPORATED:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 3, 1968, FORWARDING TWO PROTESTS RELATIVE TO TWO-STEP PROCUREMENTS UNDER REQUEST FOR PROPOSALS NO. N00140-68-Q-0400 ISSUED BY THE UNITED STATES NAVY PURCHASING OFFICE, BROOKLYN, NEW YORK, AND REQUEST FOR PROPOSALS NO. N62306-68-R-0144 ISSUED BY THE UNITED STATES NAVAL OCEANOGRAPHIC OFFICE.

WE HAVE NOW BEEN FURNISHED A FULL REPORT FROM NAVY PURCHASING OFFICE, NEW YORK, RESPECTING YOUR PROTEST AGAINST REQUEST FOR PROPOSALS NO. N00140-68- Q-0400. THAT REPORT CONFIRMS YOUR CONTENTION THAT AMBAC WAS NOT GIVEN PROMPT NOTIFICATION THAT ITS TECHNICAL PROPOSAL SUBMITTED UNDER THE FIRST STEP OF THE PROCUREMENT WAS UNACCEPTABLE. NAVY REPORTED THIS FAILURE TO GIVE NOTIFICATION WAS DUE TO INADVERTENCE WHICH IS REGRETTED AND ADVISED THE CIRCUMSTANCES WHICH LED TO THE OVERSIGHT WERE AS FOLLOWS.

THE PROCUREMENT WAS CONSIDERED COMPETITIVE AND WAS PROCESSED WITH 28 FIRMS ORIGINALLY INVITED TO PARTICIPATE. HOWEVER, TECHNICAL PROBLEMS RAISED AFTER RELEASE OF THE ORIGINAL REQUEST REQUIRED CLARIFICATION AND RESCHEDULING OF THE OPENING DATE, RESULTING IN 4 MONTHS' LAPSE BETWEEN RECEIPT OF THE REQUISITION AT THE PURCHASING OFFICE AND THE FINAL TARGET DATE FOR OPENING OF PROPOSALS. ONLY ONE OF THE FOUR PROPOSALS SUBMITTED, THAT OF BELL AEROSYSTEMS, WAS FOUND TECHNICALLY ACCEPTABLE BY THE REQUIRING ACTIVITY, THE NAVAL APPLIED SCIENCE LABORATORY, AND THIS NECESSARY TECHNICAL EVALUATION CONSUMED MUCH OF THE AVAILABLE PURCHASE LEAD TIME. AT THIS POINT, AMBAC, AS WELL AS THE OTHER REJECTED OFFERORS, SHOULD HAVE BEEN NOTIFIED AS REQUIRED BY ARMED SERVICES PROCUREMENT REGULATION 2-503.1 (A) (IX). HOWEVER, BECAUSE OF TIME ALREADY EXPENDED AND THE NEED FOR THE PROCUREMENT, SUBJECT PROCUREMENT HAD BEEN ASSIGNED AN UMMIPS PRIORITY 4 AND A DMR OF JUNE 30, 1968; A DECISION WAS THEREFORE MADE TO NEGOTIATE UNDER AUTHORITY OF ASPR 3-210.2 (III) AND NOTIFICATION TO AMBAC WAS OVERLOOKED IN THE HASTE. THIS PROCUREMENT WAS NOT CONSIDERED A SOLE SOURCE SITUATION AND NEGOTIATION WITH ONLY ONE FIRM WAS INITIATED AS THE SOLE REMAINING ALTERNATIVE.

THE COMPANIES SUBMITTING TECHNICAL PROPOSALS UNDER THE FIRST STEP SHOULD HAVE BEEN NOTIFIED THAT THEIR PROPOSALS WERE TECHNICALLY UNACCEPTABLE AND THAT BECAUSE ONLY ONE PROPOSAL WAS ACCEPTABLE TWO STEP ADVERTISING WAS BEING DISCONTINUED IN FAVOR OF NEGOTIATION. HOWEVER, SUCH NOTIFICATION OR LACK THEREOF WOULD NOT ALTER THE FACTUAL NEED FOR NEGOTIATION WITH THE ONLY TECHNICALLY QUALIFIED OFFEROR. NOR WOULD THE RECEIPT OF NOTIFICATION HAVE GIVEN AMBAC THE RIGHT TO MODIFY THEIR PROPOSAL IN AN ATTEMPT TO BECOME QUALIFIED. ASPR 2-503.1 (A) (VIII) REQUIRES THE SOLICITATION TO CONTAIN A STATEMENT ADVISING OFFERORS TO SUBMIT FULL AND COMPLETE PROPOSALS SINCE DETERMINATION OF ACCEPTABILITY OF THE PROPOSAL MAY BE MADE WITHOUT FURTHER DISCUSSIONS.

INASMUCH AS THE ONLY RIGHT CREATED BY ASPR 2-503.1 (A) (IX), THAT OF NOTICE, IS PROCEDURAL AND DOES NOT GO TO THE LEGAL ESSENCE OF THE AWARD, YOUR PROTEST MUST BE DENIED. HOWEVER, NAVY HAS ADVISED THAT THE INTERNAL INSTRUCTIONS HAVE BEEN REEMPHASIZED TO PRECLUDE A RECURRENCE OF THIS TYPE OF PROCEDURAL BREAKDOWN.

YOUR PROTEST IN CONNECTION WITH REQUEST FOR PROPOSALS NO. N62306-68 R- 0144 WILL BE SEPARATELY CONSIDERED UPON RECEIPT OF A REPORT FROM THE PROCURING ACTIVITY.