B-165295, AUG. 26, 1969

B-165295: Aug 26, 1969

Additional Materials:

Contact:

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

 

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

A BIDDER WHO DID MEET DELIVERY REQUIREMENTS MAY NOT HAVE PROTEST UPHELD SINCE BID WAS NOT RESPONSIVE AND NO AMBIGUITY IN PROVISION IS FOUND. WITH RESPECT TO ALLEGATION THAT SUCCESSFUL BIDDER DID NOT HAVE IN SERVICE HISTORY OF EQUIPMENT. IT WAS DETERMINED THAT SPECIFICATIONS WERE PREPARED ON BASIS OF ECONOMY RATHER THAN EFFICIENCY AND THEREFORE DETERMINATION THAT CHEAPER EQUIPMENT BUT PROBABLY LESS EFFICIENT EQUIPMENT WILL NOT BE QUESTIONED. ADMINISTRATION IS REQUESTED TO RECEIVE ITS SERVICE RECORDS OF UNITS DELIVERED UNDER THE PROCUREMENT. MOSS AND TAVENNER: REFERENCE IS MADE TO YOUR LETTERS OF SEPTEMBER 20 AND 26. B1-MA69-2 WAS ISSUED ON AUGUST 7. THE ONLY OTHER AMENDMENT RELEVANT TO THE PRESENT PROTEST WAS AMENDMENT NO. 3.

B-165295, AUG. 26, 1969

BID PROTEST - CAPABILITY - EVALUATION DECISION DENYING PROTEST OF AMERICAN MACHINE AND FOUNDRY COMPANY AGAINST AWARD TO AQUA-CHEM, C., LOW BIDDER, FOR FURNISHING DESALINATION UNITS TO MARITIME ADMINISTRATION. A BIDDER WHO DID MEET DELIVERY REQUIREMENTS MAY NOT HAVE PROTEST UPHELD SINCE BID WAS NOT RESPONSIVE AND NO AMBIGUITY IN PROVISION IS FOUND. WITH RESPECT TO ALLEGATION THAT SUCCESSFUL BIDDER DID NOT HAVE IN SERVICE HISTORY OF EQUIPMENT, GAO REQUESTED THAT PROCUREMENT AGENCY OBTAIN INFORMATION CONCERNING SERVICE RECORDS. IT WAS DETERMINED THAT SPECIFICATIONS WERE PREPARED ON BASIS OF ECONOMY RATHER THAN EFFICIENCY AND THEREFORE DETERMINATION THAT CHEAPER EQUIPMENT BUT PROBABLY LESS EFFICIENT EQUIPMENT WILL NOT BE QUESTIONED. ADMINISTRATION IS REQUESTED TO RECEIVE ITS SERVICE RECORDS OF UNITS DELIVERED UNDER THE PROCUREMENT.

TO HART, MOSS AND TAVENNER:

REFERENCE IS MADE TO YOUR LETTERS OF SEPTEMBER 20 AND 26, 1968, PROTESTING IN BEHALF OF AMF CUNO DIVISION OF AMERICAN MACHINE AND FOUNDRY COMPANY (AMF CUNO) AGAINST AWARD OF A CONTRACT TO ANOTHER FIRM UNDER SOLICITATION NO. B1-MA69-2, ISSUED BY THE DEPARTMENT OF COMMERCE, MARITIME ADMINISTRATION.

SOLICITATION NO. B1-MA69-2 WAS ISSUED ON AUGUST 7, 1968, FOR QUANTITIES OF 20, 30, 40 AND 50 DESALINATION UNITS WITH AN OPENING DATE OF 2:00 P.M. EDST, SEPTEMBER 5, 1968, SUBSEQUENTLY EXTENDED TO SEPTEMBER 16, 1968, BY AMENDMENT NO. 2. THE ONLY OTHER AMENDMENT RELEVANT TO THE PRESENT PROTEST WAS AMENDMENT NO. 3, WHICH CLARIFIED THE SPECIFICATIONS BY EXCLUDING THOSE UNITS WHICH EMPLOY SUBMERGED OR SEMI-SUBMERGED TUBES FOR EVAPORATION OF UNPROCESSED WATER. THIS AMENDMENT WAS ISSUED AS A RESULT OF A CONVERSATION, WHICH IS DISCUSSED BELOW, BETWEEN REPRESENTATIVES OF AMF CUNO AND THE ENGINEERING STAFF OF THE MARITIME OFFICE OF SHIP OPERATIONS, DIVISION OF SHIP REPAIR AND MAINTENANCE. THE BIDS WERE OPENED ON SCHEDULE AND AQUA-CHEM, INC., WAS THE LOW BIDDER OFFERING A UNIT PRICE OF $13,130 FOR ALL QUANTITIES WITH A 60 DAY DELIVERY FOR THE FIRST TWO UNITS AND FOUR UNITS PER MONTH THEREAFTER. AMF CUNO, THE ONLY OTHER BIDDER, OFFERED A UNIT PRICE RANGING FROM $19,850 FOR 20 UNITS TO $19,450 FOR 50 UNITS WITH A DELIVERY DATE OF 160 DAYS FOR THE FIRST TWO UNITS AND FOUR UNITS PER MONTH THEREAFTER.

BY YOUR LETTER OF SEPTEMBER 20, 1968, AS SUPPLEMENTED BY YOUR LETTER OF SEPTEMBER 26, 1968, YOU PROTESTED AGAINST AN AWARD TO AQUA-CHEM. YOUR FIRST CONTENTION RELATES TO DELIVERY TIME. YOU POINT OUT THAT PAGE 4 OF THE CONTINUATION SHEET OF THE INVITATION STATES THAT TWO OF THE DESALINATION UNITS ARE REQUIRED WITHIN SIXTY CALENDAR DAYS AFTER RECEIPT OF NOTICE OF AWARD, AND FOUR PER MONTH THEREAFTER. HOWEVER, YOU STATE THAT THIS IS FOLLOWED BY THE FOLLOWING STATEMENT:

"DELIVERY WILL BE MADE ON TWO (2) UNITS WITHIN ----- CALENDAR DAYS AFTER -NOTICE OF AWARD- THEN ----- UNITS PER MONTH THEREAFTER.'

YOU POINT OUT THAT NOTHING IS SAID ANYWHERE IN THE SOLICITATION AS TO THE EFFECT OF A BID WHICH SPECIFIES A LONGER OR SHORTER PERIOD OF TIME FOR DELIVERY OF THE FIRST TWO UNITS OR A GREATER OR LESSER QUANTITY PER MONTH THEREAFTER. YOUR BRIEF THEREAFTER APPEARS TO ALLEGE GENERALLY THAT THE SPECIFICATIONS WERE INADEQUATE IN THAT THEY WERE INDEFINITE, AMBIGUOUS AND DID NOT PERMIT BIDDERS TO COMPETE ON EQUAL TERMS. AS AN EXAMPLE OF THESE INADEQUACIES YOU POINT OUT THAT SINCE THE SPECIFICATIONS CALLED FOR DESALINATION UNITS OF "THE LOW PRESSURE AND/OR PARTIAL VACUUM DISTILLATION TYPE," BIDDERS WERE PERMITTED TO BID ON (1) THE SUBMERGED TUBE TYPE; (2) THE FILM YPE; AND (3) THE FLASH TYPE, EITHER THE SINGLE OR MULTI-STAGE VARIETY. ALSO, YOU POINT OUT THAT THERE IS NO PERFORMANCE REQUIREMENT RELATED TO THE OPERATING EFFICIENCY OF THE UNITS TO BE SUPPLIED BY THE SUCCESSFUL BIDDER.

YOU STATE THAT IT WAS BECAUSE OF THESE APPARENT DEFICIENCIES IN THE SPECIFICATIONS THAT MR. ALAN HALE OF AMF CUNO SOUGHT AND OBTAINED A CONFERENCE WITH COGNIZANT PERSONNEL OF THE ENGINEERING STAFF OF THE MARITIME OFFICE OF SHIP OPERATIONS, DIVISION OF SHIP REPAIR AND MAINTENANCE, WHICH HAD PREPARED THE SPECIFICATIONS FOR THE PRESENT PROCUREMENT. YOU ALLEGE THAT DURING THIS CONFERENCE AMF CUNO'S REPRESENTATIVES WERE ADVISED THAT IT WAS THE INTENT OF THE MARITIME ADMINISTRATION TO REPLACE THE ORIGINAL SUBMERGED TUBE EVAPORATORS WITH THE NEWEST TYPE OF FLASH TYPE PLANTS, AND A CHANGE IN THE SPECIFICATIONS WOULD BE MADE. ACCORDINGLY, AMENDMENT NO. 3 TO THE SPECIFICATIONS WAS ISSUED, WHICH EXCLUDED UNITS EMPLOYING SUBMERGED OR SEMI-SUBMERGED TUBES FOR EVAPORATION OF UNPROCESSED WATER. HOWEVER, YOU STATE THAT, CONTRARY TO YOUR UNDERSTANDING OF THE PROPOSED AMENDMENT, THIS STILL LEFT THE BIDDER WITH THE OPTION OF FURNISHING EITHER THE FILM TYPE DISTILLATION UNIT OR ONE OF THE TWO FLASH TYPES.

CONCERNING THE DELIVERY SCHEDULE, MARITIME'S ADMINISTRATIVE REPORT OF NOVEMBER 1, 1968, STATED THAT IN VIEW OF THE FACT THAT AQUA-CHEM, INC., INDICATED IN THEIR BID THAT THEY WOULD MEET THE REQUIRED DELIVERY TIME OF 60 DAYS FOR THE FIRST TWO UNITS AND FOUR UNITS PER MONTH THEREAFTER AND THAT AMF CUNO'S BEST DELIVERY OFFER WAS 160 DAYS FOR THE FIRST TWO UNITS AND FOUR UNITS PER MONTH THEREAFTER, IT APPEARED THAT BOTH COMPANIES UNDERSTOOD THE MEANING OF THE CLAUSE. IT IS WELL SETTLED THAT A CONTRACT SHOULD BE INTERPRETED TO GIVE EFFECT TO ALL PROVISIONS OF THE CONTRACT, WHENEVER POSSIBLE, WITHOUT VIOLATING THE PLAIN LANGUAGE OF THE CONTRACT OR CLEAR INTENT OF THE PARTIES. BRODERICK WOOD PROJECTS COMPANY V UNITED STATES, 195 F.2D 433. COURTS WILL DECLARE A CONTRACT PROVISION MEANINGLESS ONLY WHEN SUCH A CONCLUSION IS LEGALLY OR FACTUALLY COMPELLED. FOX MIDWEST THEATRE V MEANS, 221 F.2D 173. THEREFORE, IF WE WERE TO CONCLUDE THAT THE CLAUSE "DELIVERY WILL BE MADE ON TWO (2) UNITS WITHIN ----- CALENDAR DAYS AFTER -NOTICE OF AWARD,- THEN ----- UNITS PER MONTH THEREAFTER" PERMITTED THE BIDDER TO INDICATE A PERIOD IN EXCESS OF 60 DAYS FOR THE FIRST TWO UNITS AND A QUANTITY OR RATE LESS THAN FOUR UNITS PER MONTH THEREAFTER, WE WOULD IN EFFECT BE MAKING THE PRECEDING CLAUSE MEANINGLESS. THE LOGICAL INTERPRETATION OF THE ABOVE CLAUSE IS THAT IT MUST BE FILLED OUT IN A MANNER WHICH WILL, AT LEAST, COMPLY WITH THE PRECEDING CLAUSE WHICH STATES: "DELIVERY OF DESALINATION/S) UNITS SHOWN ABOVE IS REQUIRED AS FOLLOWS: TWO (2) UNITS SIXTY (60) CALENDAR DAYS AFTER RECEIPT OF NOTICE OF AWARD, THEN FOUR (4) UNITS PER MONTH THEREAFTER.'

THIS LATTER CLAUSE CLEARLY STATES THE PROCURING ACTIVITY'S DELIVERY REQUIREMENTS. EARLIER DELIVERY MIGHT PROPERLY BE OFFERED, BUT ANY BIDDER OFFERING TO DELIVER THE FIRST TWO UNITS ANY LATER THAN 60 DAYS AFTER NOTICE OF AWARD OR PROPOSING DELIVERY OF ANY LESS THAN FOUR UNITS PER MONTH THEREAFTER WOULD BE NONRESPONSIVE. THIS OFFICE HAS, ON OCCASION, PERMITTED THE PROCURING ACTIVITY TO ACCEPT A BID THAT WAS NOT RESPONSIVE TO THE DELIVERY SCHEDULE WHERE THERE WERE NO OTHER BIDS RESPONSIVE TO THE DELIVERY SCHEDULE AND THEREFORE NO PREJUDICE TO OTHER BIDDERS. SEE 34 COMP. GEN. 364; 40 COMP. GEN. 280; B-156528, JANUARY 10, 1966. HOWEVER, WE HAVE ALSO HELD THAT THE ACCEPTANCE OF A BID NOT IN COMPLIANCE WITH THE ADVERTISED DELIVERY SCHEDULE IS NOT AUTHORIZED AND ANY AWARD MADE THEREON WOULD NOT BE VALID AND BINDING UPON THE GOVERNMENT, SINCE THE DELIVERY SCHEDULE IS A MATERIAL REQUIREMENT OF THE INVITATION AND TO WAIVE IT WOULD BE PREJUDICIAL TO THE OTHER BIDDERS. SEE 36 COMP. GEN. 181, 183. CONSEQUENTLY, AWARD TO YOU OF A CONTRACT UNDER THE PRESENT PROCUREMENT WOULD HAVE BEEN IMPROPER SINCE YOUR BID WAS NOT RESPONSIVE, AND WE FIND NO AMBIGUITY IN THE INCLUSION OF BLANK SPACES FOR DELIVERY OFFERED, WHICH MIGHT PROPERLY HAVE BEEN USED TO PROPOSE EARLIER OR FASTER DELIVERY.

CONCERNING YOUR STATEMENT THAT THE SPECIFICATIONS WERE INADEQUATE, THE ADMINISTRATIVE REPORT STATED, IN PERTINENT PART, THAT: "AS WRITTEN, THE SPECIFICATION, WITH SUPPLEMENTS, WAS TO EFFECT FROM APPLICABLE MANUFACTURERS IN-SERVICE PROVEN MARINE DESALINATION UNITS AT LOWEST POSSIBLE UNIT COST WHILE FULFILLING THE REQUIREMENTS AND EXISTING OPERATIONAL CONDITIONS ON BOARD APPLICABLE SHIPS. IT MEETS THE REQUIREMENT OF SECTION 303 (A), FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949, 40 U.S.C. SECTION 253 (A), WHICH BY ITS TERMS IS APPLICABLE TO THE DEPARTMENT OF COMMERCE, WHICH READS -... SPECIFICATIONS AND INVITATIONS FOR BIDS SHALL PERMIT SUCH FULL AND FREE COMPETITION AS IS CONSISTENT WITH THE PROCUREMENT OF TYPES OF PROPERTY AND SERVICES NECESSARY TO MEET THE REQUIREMENTS OF THE AGENCY CONCERNED.- "THE SPECIFICATION, WITH SUPPLEMENTS, WAS NOT CONFINING AS TO A TYPE OF DESALINATION UNIT OTHER THAN ITS PRECLUSION OF THE SUBMERGED OR SEMI- SUBMERGED TYPE-, IN ORDER THAT THE GOVERNMENT MIGHT REALIZE MAXIMAL SAVINGS IN THE PROCUREMENT OF IN-SERVICE PROVEN MARINE DESALINATION UNITS EMPLOYING PROVEN INNOVATIONS MINIMIZING REPAIRS, MAINTENANCE AND OPERATIONAL SURVEILLANCE.'THE NOTED ABSENCE OF A SPECIFIC -OPERATING OR PERFORMANCE EFFICIENCY- REQUIREMENT WAS TO PERMIT BIDDERS TO BID ON ANY ONE, OR SEVERAL, DESALINATION UNIT/S) MEETING THE NECESSARY AND STATED REQUIREMENT -OF DOCUMENTED AND PROVEN MARINE DESIGN, CONSTRUCTION AND IN- SERVICE OPERATION.- ANY TYPE DESALINATION UNIT MEETING SUCH CONDITIONS WOULD HAVE AN ACCEPTABLE EFFICIENCY RATING.'

THE ABOVE EXPLANATION BY THE PROCURING ACTIVITY APPEARS TO BE CONSISTENT WITH YOUR INTERPRETATION OF THE SPECIFICATIONS, IN THAT THE BIDDER DID HAVE AN OPTION OF FURNISHING EITHER THE FILM TYPE DISTILLATION UNIT OR ONE OF THE TWO FLASH TYPES.

BY LETTER OF NOVEMBER 6, 1968, IN RESPONSE TO THE ADMINISTRATIVE REPORT, YOU AGAIN BRING UP THE ALLEGED FACT THAT THE MARITIME ADMINISTRATION STATED THAT IT WAS ITS INTENT TO REPLACE THE SUBMERGED TUBE EVAPORATORS WITH NEW FLASH TYPE PLANTS. YOU ALLEGE THAT THIS STATEMENT CONCERNING THE MARITIME ADMINISTRATION'S INTENT, COUPLED WITH A MISTAKEN ASSUMPTION THAT THE AMENDED SPECIFICATIONS RESTRICTED THE PROCUREMENT TO A FLASH TYPE UNIT, LED YOU TO BELIEVE THAT THE ONLY UNIT ACCEPTABLE TO THE MARITIME ADMINISTRATION WOULD BE A FLASH UNIT. YOU FURTHER STATED THAT HAD YOU KNOWN THAT THE SPRAY FILM TYPE UNIT WAS ACCEPTABLE YOU COULD HAVE OFFERED A UNIT SIMILAR TO THE UNIT OFFERED BY AQUA-CHEM AT A PRICE COMPETITIVE WITH AQUA-CHEM. IN ADDITION, YOU STATE THAT THE SPECIFICATIONS REQUIRE "DISTILLATION UNITS OF DOCUMENTED AND PROVEN MARINE DESIGN, CONSTRUCTION AND IN SERVICE OPERATION...' AND THAT YOU HAVE REASON TO BELIEVE THAT THE UNIT OFFERED BY AQUA-CHEM HAS NO IN-SERVICE HISTORY.

IN ANSWER TO YOUR LETTER, THE MARITIME ADMINISTRATION, IN ITS SUPPLEMENTARY REPORT OF JANUARY 13, 1969, DENIED THAT AT ANY TIME WAS IT STATED BY ENGINEERING PERSONNEL OF THE MARITIME ADMINISTRATION THAT IT WAS THE INTENT OF MARITIME ADMINISTRATION TO REPLACE THE ORIGINAL SUBMERGED OR SEMI-SUBMERGED TUBE TYPE EVAPORATORS WITH THE NEWEST TYPE OF FLASH PLANTS. ON THE CONTRARY, IT WAS STATED THAT THE KNOWN AUSTERITY ASSOCIATED WITH THE EVAPORATOR REPLACEMENT PROGRAM PRECLUDED THE MAKING OF SUCH A STATEMENT. HOWEVER, THE REPORT FURTHER STATED THAT THIS DID NOT PRECLUDE THE DESIRE THAT SOME MANUFACTURER WOULD FABRICATE AN AUSTERE FLASH TYPE PLANT CONFORMING TO THE SPECIFICATIONS AT AN ACCEPTABLE UNIT PRICE.

IN ANSWER TO YOUR ALLEGATION THAT AQUA-CHEM'S UNIT HAD NO IN-SERVICE HISTORY, THERE WAS ENCLOSED A BROCHURE PUBLISHED BY AQUA-CHEM ENTITLED "SPRAY FILM EVAPORATORS" WHICH DESCRIBED SIMILAR UNITS IN OPERATION ABOARD CERTAIN SHIPS, INCLUDING THE FOLLOWING:

SURVEY SHIP - SS OCEANOGRAPHER (00S-01)

CARGO SHIP - SS PRODUCER

NAVAL VESSEL ROSEBUD

NAVAL ESCORT VESSELS - PF-103

AS A RESULT OF ADDITIONAL INFORMATION WHICH YOU SUPPLIED INDICATING THAT THE SERVICE RECORDS ON AQUA-CHEM UNITS ABOARD BOTH THE "OCEANOGRAPHER" AND THE "PONCE DE LEON" MIGHT BE UNSATISFACTORY, AND FOLLOWING CONVERSATIONS WITH COGNIZANT PROCUREMENT AND TECHNICAL PERSONNEL OF THE MARITIME ADMINISTRATION, WE CONCLUDED THAT MARITIME ADMINISTRATION'S REPORTS OF NOVEMBER 1, 1968, AND JANUARY 13, 1969, TO THIS OFFICE, DID NOT ANSWER THE QUESTION WHETHER THE AQUA-CHEM SPI UNITS WERE IN FACT "OF DOCUMENTED AND PROVEN MARINE DESIGN, CONSTRUCTION AND IN-SERVICE OPERATION," AS REQUIRED BY THE SPECIFICATIONS. MOREOVER, IT APPEARED THAT WHILE THE MARITIME ADMINISTRATION HAD NO RECORD OF UNSATISFACTORY SERVICE OF THE AQUA-CHEM UNITS, NO ATTEMPT HAD BEEN MADE TO CHECK THE COMPLETE IN-SERVICE RECORDS OF ANY AQUA-CHEM UNIT OF THAT TYPE. CONSEQUENTLY, BY LETTER OF MARCH 4, 1969, THIS OFFICE REQUESTED THAT THE MARITIME ADMINISTRATION OBTAIN INFORMATION RELATIVE TO THE ACTUAL AND COMPLETE IN-SERVICE RECORDS PRIOR TO OCTOBER 1968 ON AQUA-CHEM UNITS INSTALLED ON BOARD THE S/S PRODUCER, S/S PONCE DE LEON, THE "OCEANOGRAPHER," THE "DISCOVERER," AND ANY OTHER VESSEL USING UNITS COMPARABLE IN SIZE AND TYPE TO THE 6000 GALLONS PER DAY SPI UNITS INVOLVED IN THE PRESENT PROCUREMENT.

BY LETTER OF APRIL 9, 1969, THE MARITIME ADMINISTRATION FORWARDED TO THIS OFFICE SEVERAL REPLIES RECEIVED IN RESPONSE TO ITS INQUIRIES IN CONNECTION WITH THE IN-SERVICE RECORDS OF AQUA-CHEM UNITS. THE FIRST REPLY WAS FROM MARINE CARRIERS CORPORATION, A SUBSIDIARY OF ALPINE GEOPHYSICAL ASSOCIATES, INC., IN WHICH IT WAS STATED THAT AN AQUA-CHEM UNIT HAD BEEN INSTALLED ON BOARD THE S/S PRODUCER IN APRIL 1964 AND THAT THEY HAD ENCOUNTERED VARIOUS DIFFICULTIES WITH THE UNIT DURING THE FIRST SIX MONTHS, IN THAT IT WAS ONLY ABLE TO PRODUCE ABOUT 10, RATHER THAN THE RATED 20, TONS PER DAY. HOWEVER, AFTER SEVERAL CHANGES BY AN AQUA-CHEM REPRESENTATIVE PRODUCTION WAS INCREASED TO AN AVERAGE OF 17 OR 18 TONS PER DAY, WHICH HAD DECLINED TO 15 TONS PER DAY IN OCTOBER 1968 BECAUSE THE DISTILLATE PUMP WAS WEARING OUT.

WE WERE ADVISED BY THE MARITIME ADMINISTRATION THAT MR. JOHN HUNTINGTON, VICE PRESIDENT OF THE T.T.T. INC., REFERRING TO THE AQUA CHEM UNIT INSTALLED ON THE S/S PONCE DE LEON STATED THAT FAILURE OF SEVEN EVAPORATOR TUBES WAS CAUSED BY A FAULTY PIPING LAYOUT, AND THAT THE USE OF LIVE STEAM INSTEAD OF BLEED STEAM CAUSED EXCESSIVE SCALING. HOWEVER, MR. HUNTINGTON STATED THAT THE UNIT WHEN PROPERLY OPERATED IN THE DESIGN MODE IS AN EFFICIENT UNIT. THE CHAIRMAN, TRIAL AND GUARANTEE SURVEY BOARDS STATED, IN REFERENCE TO THE AQUA-CHEM UNITS INSTALLED ON THE S/S OCEANOGRAPHER AND S/S DISCOVERER, THAT THESE UNITS WERE DESIGNED TO OPERATE FROM TWO HEAT SOURCES, SHIP SERVICE GENERATOR COOLING WATER OR STEAM OR A COMBINATION OF BOTH. HOWEVER, IT WAS DETERMINED ON TRIALS THAT THE GENERATOR COOLING WATER HEAT SOURCE WAS NOT SUFFICIENT FOR CONTINUOUS STABLE EVAPORATOR OPERATION, BUT USING STEAM OR A COMBINATION OF COOLING WATER AND STEAM PROVIDED SUFFICIENT HEAT FOR SATISFACTORY DISTILLER OPERATION. ADDITIONAL REPORTS FROM THE FIELD WERE CONTRADICTORY, IN THAT A REPORT FROM THE ATLANTIC MARINE CENTER INDICATED THAT THE UNITS ON THE "OCEANOGRAPHER" AND "DISCOVERER" WERE "BASICALLY SATISFACTORY," WHILE THE COMMANDING OFFICER OF THE "OCEANOGRAPHER" SAID HE COULD NOT MAKE A FAVORABLE RECOMMENDATION BECAUSE CONTINUOUS PROBLEMS WERE ENCOUNTERED WITH THE PUMPS AND PUMP MOTORS DURING THE FIRST YEAR, AND BECAUSE THE EVAPORATORS HAD NEVER PRODUCED TO SPECIFICATION REQUIREMENTS.

FROM THE FOREGOING, IT WOULD APPEAR THAT THE MARITIME ADMINISTRATION WAS FACED WITH THE PROBLEM OF REPLACING DETERIORATING DESALINATION UNITS ABOARD 24 YEAR OLD SHIPS, WHICH CONCEIVABLY MIGHT NOT BE USED BEYOND THE PERIOD OF HOSTILITIES IN VIETNAM. IT IS UNDERSTANDABLE WHY ECONOMY IN THE COST OF THE UNIT WOULD BE A PRIME REQUISITE AND THAT WHEN THE SPECIFICATIONS WERE PREPARED FOR THE PROCUREMENT, ECONOMY RATHER THAN EFFICIENCY WAS THE PRIMARY CONSIDERATION. CONSEQUENTLY, WE WILL NOT QUESTION MARITIME ADMINISTRATION'S DETERMINATION THAT AQUA CHEM'S MUCH CHEAPER, BUT PROBABLY LESS EFFICIENT UNIT WOULD BE PREFERABLE TO AMF CUNO'S MUCH MORE COSTLY AND MORE EFFICIENT UNIT. WE CANNOT CONCLUDE THAT THE SPECIFICATIONS WERE EITHER INADEQUATE OR AMBIGUOUS, SINCE IT APPEARS THAT, SUBSEQUENT TO AMENDMENT NO. 3, THEY DID GIVE THE BIDDER AN OPTION TO FURNISH EITHER THE FILM OR FLASH TYPE UNIT, WHICH IS CONSISTENT WITH YOUR INTERPRETATION OF THE SPECIFICATIONS.

CONCERNING THE LACK OF A SPECIFIC OPERATING OR PERFORMANCE EFFICIENCY, THE SPECIFICATION REQUIREMENT THAT THE UNITS BE "OF DOCUMENTED AND PROVEN MARINE DESIGN, CONSTRUCTION AND IN-SERVICE OPERATION" WOULD APPEAR TO BE SUFFICIENT. HOWEVER, WITH RESPECT TO WHETHER THE MARITIME ADMINISTRATION MADE A SUFFICIENT EFFORT TO ASCERTAIN IF UNITS COMPARABLE TO THOSE OFFERED BY AQUA-CHEM HAD PROVEN IN-SERVICE RECORDS, IT IS OUR OPINION THAT THE RECORD DOES NOT SO INDICATE. THUS, AS INDICATED BY MARITIME'S REPORT OF JANUARY 13, 1969, PRIMARY RELIANCE APPEARS TO HAVE BEEN PLACED UPON A BROCHURE ISSUED BY AQUA-CHEM IN 1965 WHICH INDICATED THAT SPRAY FILM EVAPORATORS OF VARYING CAPACITIES HAD BEEN INSTALLED ON THE OCEANOGRAPHER, THE S/S PRODUCER, THE NAVAL VESSEL ROSEBUD, AND PF-103 ESCORT VESSELS. WHILE IT IS OUR OPINION THAT SUCH INFORMATION WAS INADEQUATE TO ESTABLISH A SATISFACTORY IN-SERVICE RECORD, IT DOES NOT APPEAR THAT ANY FURTHER EFFORTS WERE MADE BY MARITIME TO ASCERTAIN WHETHER THE ACTUAL IN SERVICE RECORDS OF THE AQUA-CHEM UNITS INSTALLED ON SUCH VESSELS, OR ON ANY OTHER VESSELS, WERE SATISFACTORY OR UNSATISFACTORY UNTIL THEIR RECORD WAS QUESTIONED BY YOUR PROTEST. ALTHOUGH THE INFORMATION RESULTING FROM SUCH INVESTIGATION REFLECTED ADVERSELY UPON THE IN SERVICE RECORD OF THE AQUA- CHEM UNITS, THE FINAL REPORT FROM MARITIME DATED JUNE 13 INDICATES THAT, HAD THE OPERATIONAL PROBLEMS WHICH WERE DISCOVERED FOLLOWING YOUR PROTEST BEEN KNOWN AT THE TIME OF AWARD, THEY WOULD NOT HAVE WARRANTED A CONCLUSION THAT THE UNITS OFFERED WOULD BE UNFIT OR UNSATISFACTORY FOR SERVICE. UNDER THE CIRCUMSTANCES, IT MUST BE ASSUMED THAT MARITIME WOULD HAVE DECIDED SUCH UNITS HAD A SATISFACTORY IN-SERVICE RECORD HAD IT BEEN IN POSSESSION, BEFORE AWARD, OF ALL OF THE IN-SERVICE INFORMATION WHICH RESULTED FROM YOUR PROTEST. WE ARE THEREFORE UNABLE TO CONCLUDE THAT AN AWARD COULD NOT PROPERLY HAVE BEEN MADE TO AQUA-CHEM IF THE IN-SERVICE RECORD OF THEIR UNITS HAD BEEN PROPERLY EVALUATED PRIOR TO AWARD.

WHILE, FOR THE REASONS SET OUT ABOVE, WE MUST DENY YOUR PROTEST, WE ARE TODAY ADVISING THE MARITIME ADMINISTRATION THAT ANY FUTURE PROCUREMENT OF 6000 GALLONS PER DAY AQUA-CHEM SPRAY TYPE UNITS SHOULD INCLUDE A COMPLETE REVIEW OF THE IN-SERVICE RECORD OF THE UNITS DELIVERED UNDER THE INSTANT PROCUREMENT.

TO MR. GIBSON:

REFERENCE IS MADE TO LETTERS DATED NOVEMBER 1, 1968, AND JANUARY 13, 1969, FROM THE ACTING MARITIME ADMINISTRATOR, AND TO YOUR LETTER OF APRIL 9, 1969, AND TO TWO SUPPLEMENTAL REPORTS FROM THE DIVISION OF SHIP REPAIR AND MAINTENANCE IN CONNECTION WITH THE PROTEST OF AMF CUNO DIVISION, AMERICAN MACHINE AND FOUNDRY COMPANY, AGAINST THE AWARD OF A CONTRACT UNDER SOLICITATION NO. B1-MA69-2, ISSUED BY YOUR ADMINISTRATION.

ENCLOSED IS A COPY OF OUR DECISION OF TODAY TO THE PROTESTANT'S ATTORNEYS, DENYING ITS PROTEST. YOUR ATTENTION IS INVITED TO THE LAST PARAGRAPH OF OUR DECISION, IN WHICH WE SUGGEST THAT ANY DETERMINATION ON FUTURE PROCUREMENTS OF 6000 GALLONS PER DAY UNITS FROM AQUA-CHEM SHOULD INCLUDE A REVIEW OF THE IN-SERVICE HISTORIES OF THE UNITS NOW BEING PROCURED.

ADDITIONALLY, WE ARE CONCERNED WITH THE FACT THAT MORE THAN EIGHT MONTHS WAS REQUIRED TO OBTAIN ALL OF THE INFORMATION FROM YOUR ADMINISTRATION WHICH WAS NECESSARY TO OUR DECISION, AND MORE THAN FOUR MONTHS OF THAT TIME WAS REQUIRED TO OBTAIN INFORMATION RELATIVE TO THE IN-SERVICE HISTORIES OF AQUA-CHEM SPRAY TYPE UNITS. AS YOU MAY BE AWARE, PROLONGED DELAY IN THE TRANSMISSION OF INFORMATION ON BID PROTESTS MAY OPERATE TO EFFECTIVELY PRECLUDE THIS OFFICE FROM TAKING PROPER REMEDIAL ACTION, AND SUCH DELAYS HAVE THEREFORE BECOME A MATTER OF CONCERN TO THIS OFFICE, TO THE CONGRESS AND TO BIDDERS. WE WOULD THEREFORE APPRECIATE APPROPRIATE ACTION TO INSURE THE PROMPT SUBMISSION OF COMPLETE INFORMATION IN ANY FUTURE BID PROTESTS INVOLVING YOUR ADMINISTRATION.