B-165988, MARCH 11, 1969 48 COMP. GEN. 583

B-165988: Mar 11, 1969

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WERE DEFICIENT AND DEVIATED FROM THE REQUIREMENTS OF 10 U.S.C. 2304 (G). BASED ON THE ERRONEOUS DETERMINATION A "LATE" AMENDMENT ACKNOWLEDGEMENT WAS NOT FOR CONSIDERATION. THE AWARD WILL NOT BE DISTURBED DUE TO THE URGENT NEED FOR THE PROCUREMENT. REPETITIONS OF SUCH DEVIATIONS MUST BE AVOIDED AND FUTURE PROCUREMENTS WILL BE SCRUTINIZED TO DETERMINE COMPLIANCE WITH PARAGRAPH 3-805.1 (E)- -CHANGES NOTIFICATION. 1969: REFERENCE IS MADE TO LETTERS DATED FEBRUARY 10 AND 18. THE BACKGROUND OF THE PRESENT PROCUREMENT SHOWS THAT AN INITIAL PURCHASE REQUEST FOR THE PURCHASE OF FLOATING BRIDGE SETS WAS RECEIVED BY DCSC FROM THE MARINE CORPS IN JANUARY 1967. THREE SETS WERE REQUIRED AT THAT TIME AND THE REQUIREMENT WAS FOR SOUTHEAST ASIA WITH AN "FAD II PRIORITY 02" (SECOND HIGHEST PRIORITY) ASSIGNED.

B-165988, MARCH 11, 1969 48 COMP. GEN. 583

CONTRACTS--NEGOTIATION--PROPRIETY THE PROCEDURES USED UNDER A REQUEST FOR PROPOSALS ISSUED PURSUANT TO 10 U.S.C. 2304 (A) (2) DUE TO THE URGENT NEED FOR THE PROCUREMENT, WHERE DURING THE 2 YEARS BETWEEN INITIAL NEED AND CONTRACT AWARD REPEATED REVISIONS OCCURRED RESPECTING QUANTITY, DATES FOR RECEIPT AND ACCEPTANCE OF PROPOSALS, PRICE, DELIVERY DESTINATION, AND AVAILABILITY OF GOVERNMENT- OWNED EQUIPMENT, WERE DEFICIENT AND DEVIATED FROM THE REQUIREMENTS OF 10 U.S.C. 2304 (G), THE CONTRACTING AGENCY HAVING FAILED TO SIMULTANEOUSLY NOTIFY ALL PROSPECTIVE CONTRACTORS OF CHANGES AS THEY OCCURRED DURING NEGOTIATION IN ACCORDANCE WITH PARAGRAPH 3 805.1 (E) (II) OF THE ARMED SERVICES PROCUREMENT REGULATION, AND HAVING FAILED TO ADVISE THE LOW OFFEROR OF THE FINAL CUTOFF DATE FOR NEGOTIATIONS AS REQUIRED BY PARAGRAPH 3-805.1 (B), BASED ON THE ERRONEOUS DETERMINATION A "LATE" AMENDMENT ACKNOWLEDGEMENT WAS NOT FOR CONSIDERATION. CONTRACTS--AWARDS-- CANCELLATION--ERRONEOUS AWARDS- CANCELLATION NOT REQUIRED ALTHOUGH THE NEGOTIATION PROCEDURES CONDUCTED PRIOR TO THE AWARD OF A CONTRACT FOR FLOATING BRIDGE SETS TO BE DELIVERED TO VIETNAM DEVIATED FROM THE REQUIREMENTS OF 10 U.S.C. 2304 (G) RESPECTING THE SIMULTANEOUS NOTIFICATION OF ALL PROSPECTIVE CONTRACTORS OF SOLICITATION CHANGES AND ADVICE TO THE LOW OFFEROR OF THE COMMON CUTOFF DATE FOR NEGOTIATIONS, THE AWARD WILL NOT BE DISTURBED DUE TO THE URGENT NEED FOR THE PROCUREMENT, AND ON THE BASIS THE CANCELLATION OF THE AWARD WOULD SUBJECT THE GOVERNMENT TO SUBSTANTIAL TERMINATION COSTS. HOWEVER, REPETITIONS OF SUCH DEVIATIONS MUST BE AVOIDED AND FUTURE PROCUREMENTS WILL BE SCRUTINIZED TO DETERMINE COMPLIANCE WITH PARAGRAPH 3-805.1 (E)- -CHANGES NOTIFICATION--- AND PARAGRAPH 3-805.1 (B)---COMMON CUTOFF DATE- -OF THE ARMED SERVICES PROCUREMENT REGULATION, THUS AFFORDING ALL OFFERORS EQUAL NEGOTIATION OPPORTUNITY.

TO THE DIRECTOR, DEFENSE SUPPLY AGENCY, MARCH 11, 1969:

REFERENCE IS MADE TO LETTERS DATED FEBRUARY 10 AND 18, 1969,WITH ENCLOSURES, FROM THE ASSISTANT COUNSEL, AND RELATED CORRESPONDENCE, FURNISHING A REPORT ON THE PROTEST BY THE GENERAL STEEL TANK CO. (GST) AGAINST THE AWARD OF A CONTRACT TO THE MENOMINEE ENGINEERING CORPORATION (MEC) UNDER REQUEST FOR PROPOSALS (RFP) NO. DSA-700-68-R 7400, ISSUED BY THE DEFENSE CONSTRUCTION SUPPLY CENTER (DCSC), DIRECTORATE OF PROCUREMENT & PRODUCTION, COLUMBUS, OHIO.

THE BACKGROUND OF THE PRESENT PROCUREMENT SHOWS THAT AN INITIAL PURCHASE REQUEST FOR THE PURCHASE OF FLOATING BRIDGE SETS WAS RECEIVED BY DCSC FROM THE MARINE CORPS IN JANUARY 1967. THREE SETS WERE REQUIRED AT THAT TIME AND THE REQUIREMENT WAS FOR SOUTHEAST ASIA WITH AN "FAD II PRIORITY 02" (SECOND HIGHEST PRIORITY) ASSIGNED. THE SOLICITATION UNDER THE INITIAL REQUEST DID NOT GENERATE ANY RESPONSES, APPARENTLY BECAUSE THE PROSPECTIVE SOURCES WERE NOT INTERESTED IN SUBMITTING OFFERS ON THE QUANTITY TENDERED BY DCSC. THEREUPON, THE MARINE CORPS INCREASED THE QUANTITY TO EIGHT SETS AND THE SOLICITATION WAS CONTINUED ON THIS BASIS AND A SERIES OF AMENDMENTS WERE ISSUED CLARIFYING THE SPECIFICATION. HOWEVER, AT THE CLOSING DATE OF FEBRUARY 8, 1968, ONLY ONE OFFER WAS RECEIVED. THIS OFFER EXCEEDED THE FUNDS AVAILABLE FOR THE PURCHASE OF THE EIGHT SETS. THEREAFTER, THE MARINE CORPS SUSPENDED ACTION ON FEBRUARY 29, 1968, AND SUBSEQUENTLY REVISED THE SPECIFICATIONS TO CALL FOR A LESS COMPLEX BRIDGE. THE REVISION TO THE SPECIFICATION REQUIREMENTS WAS RECEIVED MARCH 26, 1968, AND WAS THE BASIS FOR A NEW SOLICITATION, THE SUBJECT RFP 700-68 -R-7400 (ISSUED PURSUANT TO MARINE CORPS MILITARY INTERDEPARTMENTAL PROCUREMENT REQUESTS (MIPR'S) NOS. M00027-6291-3412 AND M00027-7243- 3331).

THE RFP WAS ISSUED ON APRIL 24, 1968 (CITING 10 U.S.C. 2304 (A) (2) AS THE NEGOTIATION AUTHORITY), AND SOLICITED OFFERS FOR EIGHT BRIDGES (FIXED, FLOATING, 60-TON CAPACITY) WITH RELATED PROVISIONING, INTERIM STOCK REPAIR PARTS AND TECHNICAL DATA SHEETS. THEREAFTER, AMENDMENT NO. 0001, ISSUED MAY 14, 1968, INCREASED THE QUANTITY OF BRIDGES REQUESTED FROM EIGHT TO 11; AMENDMENT NO. 0002, ISSUED MAY 21, 1968, EXTENDED THE CLOSING DATE FOR RECEIPT OF PROPOSALS FROM MAY 24 TO JUNE 7, 1968; AMENDMENT NO. 0003, ISSUED MAY 31, 1968, CORRECTED THE SHIPPING DESTINATION FROM BARLOW, FLORIDA, TO BARSTOW, CALIFORNIA; AND AMENDMENT NO. 0004 EXTENDED THE CLOSING DATE FOR THE RECEIPT OF PROPOSALS TO JUNE 28, 1968. ON THIS DATE, IT IS REPORTED THAT SEVEN PROPOSALS WERE RECEIVED, ALL WITH A COMMON ACCEPTANCE DATE OF AUGUST 26, 1968. AT THIS STAGE, GST WAS THE APPARENT LOW OFFEROR AND MEC WAS SECOND LOWEST.

WE NOTE PARENTHETICALLY THAT, WHILE NEGOTIATION WAS AUTHORIZED UNDER 10 U.S.C. 2304 (A) (2), BECAUSE THE PUBLIC EXIGENCY WILL NOT PERMIT THE DELAY INCIDENT TO ADVERTISING, 2 YEARS ELAPSED BETWEEN THE EXPRESSION OF URGENT NEED AND THE AWARD OF A CONTRACT. INDEED, WE UNDERSTAND THAT AN MIPR FOR THREE BRIDGE SETS WAS ISSUED ON OCTOBER 31, 1966, IN WHICH THE DELIVERY DATE WAS SPECIFIED AS DECEMBER 1, 1966. WITH THE BENEFIT OF HINDSIGHT, IT MAY BE SAID THAT FORMAL ADVERTISING MIGHT HAVE SATISFIED THE NEEDS OF THE MARINE CORPS SOMEWHAT MORE RAPIDLY.

BY TELEGRAM DATED JULY 10, 1968, THE PROCUREMENT OFFICE ADVISED OFFERORS AS FOLLOWS:

UNCLAS IN REPLY REFER TO DCSC-CP/CPF-7-10 SIGNED WALLACE. THIS IS TO ADVISE THAT A SECOND ROUND OF NEGOTIATIONS IS BEING CONDUCTED ON ENTIRE QUANTITY OF 11 SETS BRIDGE, FIXED FLOATING 60 TON CAPACITY FSN 5420-391- 3208 TO SAME DESCRIPTION AS DSA-700-68-R-7400. REQUESTS PROPOSALS BE ON BASIS OF BID A AND B AS FOLLOWS WHICH IS SAME AS ORIGINALLY SOLICITED:

BID A

ITEMS 1AA---FOB ORIGIN FOR SHIPMENT AS LISTED IN BID B BELOW---3 SETS AND/OR FOB ORIGIN WITH ALL TRANSPORTATION CHARGES PREPAID BY CONTRACTOR TO DESTINATIONS FOR SHIPMENT TO:

ITEM 1AB---BARSTOW, CALIFORNIA---3 SETS.

ITEM 2AA---5 SETS SAME FOB AS ITEM 1AA ABOVE. ITEM 2AB SAME FOB AS ITEM 1AB ABOVE. ITEM 6AA---3 SETS SAME FOB AS ITEM 1AA ABOVE AND ITEM 6AB SAME FOB AS ITEM 1AB ABOVE. ITEMS 3, 4, AND 5 TO BE QUOTED AS ORIGINALLY SOLICITED.

DELIVERY REQUIREMENT: ITEM 1---3 SETS IN 150 DAYS ADA, ITEM 2---5 SETS IN 210 DAYS ADA AND ITEM 6---3 SETS IN 240 DAYS ADA. SINCE THIS IS AN URGENT PROCUREMENT IT IS REQUESTED THAT YOU CAREFULLY REVIEW YOUR PROPOSAL WITH RESPECT TO DELIVERY AND PRICE AND ADVISE THE CONTRACTING OFFICER NOT LATER THAN 4:00 P.M. EDST 17 JULY 68 AS TO THE BEST PRICE AND TIME OF DELIVERY THAT YOUR FIRM CAN OFFER. THIS REQUEST IS SUBJECT TO ALL THE TERMS AND CONDITIONS OF REQUEST FOR PROPOSAL DSA-700-68-R 7400. ANY REVISION OF YOUR PROPOSAL RECEIVED AFTER ABOVE CLOSING DATE WILL BE TREATED AS A LATE MODIFICATION SUBJECT TO PARAGRAPH 8 STANDARD FORM 33-A WHICH FORMED A PART OF THE REQUEST FOR PROPOSAL.

IN RESPONSE TO SUCH TELEGRAM, NONE OF THE OFFERORS CHANGED THEIR INITIAL PROPOSAL OR PRICE, EXCEPT MEC WHICH REDUCED ITS PRICE BY $7,941 PER BRIDGE SET AND ITS TOTAL OFFER TO $3,423,850.65 F.O.B. DESTINATION AND $3,314,352.25 F.O.B. ORIGIN. HOWEVER, GST'S OFFER IN AMOUNT OF $3,338,341 (SUBMITTED ON AN F.O.B. DESTINATION PRICE) STILL REMAINED THE APPARENT LOW OFFER.

SUBSEQUENTLY, ON AUGUST 9, 1968, THE PROCUREMENT OFFICE WAS ADVISED BY THE MARINE CORPS THAT THE MIPR'S WOULD HAVE TO BE REVISED TO ALLOW SHIPMENT OF SEPARATE COMPONENTS OF THE BRIDGE SET FROM SUBCONTRACTORS' PLANTS TO DESTINATION AND TO REQUIRE AN ASSEMBLY TEST OF ONE PARTIAL BRIDGE SET. ACCORDINGLY, IN VIEW OF SUCH EXPECTED CHANGE, ALL OFFERORS WERE REQUESTED ON AUGUST 22, 1968, TO EXTEND THE ACCEPTANCE PERIOD OF THEIR OFFERS TO SEPTEMBER 26, 1968. IN RESPONSE TO SUCH REQUEST, MEC EXTENDED ITS ACCEPTANCE PERIOD WITHOUT ANY CHANGE IN ITS PRICE, AND GST INCREASED ITS PRICE BY $2,455 PER BRIDGE SET IN CONNECTION WITH SUCH EXTENSION OF ITS ACCEPTANCE PERIOD.

SINCE THE PROCUREMENT OFFICE HAD NOT YET RECEIVED THE MIPR CHANGES, OFFERORS WERE REQUESTED ON SEPTEMBER 24, 1968, TO EXTEND THEIR ACCEPTANCE PERIODS TO NOVEMBER 1, 1968. GST EXTENDED ITS ACCEPTANCE PERIOD ONLY TO OCTOBER 4, 1968. ON OCTOBER 3, 1968, GST THEN EXTENDED ITS ACCEPTANCE PERIOD TO OCTOBER 7, 1968 (WITH NO INCREASE IN PRICE), AND TO OCTOBER 11 AT AN INCREASE OF $1,515 PER BRIDGE SET FOR A TOTAL INCREASE OF $16,665. ON OCTOBER 11 GST AGAIN EXTENDED ITS ACCEPTANCE PERIOD, THIS TIME TO NOVEMBER 15; GST DID NOT CHANGE ITS PRICE AND MAINTAINED ITS POSITION AS LOW OFFEROR. MEC DID NOT ACKNOWLEDGE RECEIPT OF THE REQUEST FOR EXTENSION UNTIL OCTOBER 2, SOME 6 DAYS AFTER ITS PREVIOUS EXTENSION HAD EXPIRED. ADDITION TO ACKNOWLEDGING RECEIPT, MEC GRANTED THE REQUEST BY EXTENDING ITS OFFER TO NOVEMBER 1.

THE EXPECTED CHANGES IN THE MARINE CORPS MIPR'S WERE RECEIVED BY DCSC ON SEPTEMBER 30. ON OCTOBER 18, AMENDMENT NO. 0005 WAS ISSUED TO PERMIT THE SEPARATE SHIPMENT OF COMPONENTS BY SUBCONTRACTORS AND REQUIRING FIRST ARTICLE (ASSEMBLY) TEST. A CLOSING DATE OF OCTOBER 25 WAS FIXED BY THE AMENDMENT. IT ALSO INCLUDED A REQUEST THAT OFFERORS FURNISH FURTHER EXTENSIONS OF THEIR ACCEPTANCE PERIODS TO NOVEMBER 15. BY TELEGRAM DATED OCTOBER 24, MEC SIGNIFIED RECEIPT AND ACCEPTANCE OF THE AMENDMENT, GRANTED THE REQUESTED EXTENSION AND DECREASED THE UNIT PRICE OF THE BRIDGE SETS BY $2,287.25. GST WIRED DCSC ON OCTOBER 29, ACKNOWLEDGING RECEIPT OF THE AMENDMENT, EXTENDING ITS ACCEPTANCE PERIOD TO NOVEMBER 15 AND INCREASING ITS PRICE $5,500 PER BRIDGE SET. THE ADMINISTRATIVE REPORT INDICATES THAT AFTER THESE CHANGES WERE EFFECTED GST CONTINUED TO BE THE LOW OFFEROR.

IT WAS THEREUPON DETERMINED THAT THE GOVERNMENT WOULD NOT BE ABLE TO PROVIDE THE GAUGES WHICH THE SPECIFICATIONS REQUIRED IT TO FURNISH BECAUSE THE GAUGES WERE BEING USED UNDER ARMY CONTRACTS FOR SOME OF THE COMPONENTS OF THE BRIDGES. IN VIEW OF THE TIME REQUIRED TO RESOLVE THIS NEW COMPLICATION, DCSC ON NOVEMBER 12 TELEGRAPHICALLY REQUESTED ALL OFFERORS TO EXTEND THEIR ACCEPTANCE PERIODS TO NOVEMBER 29. MEC BY TELEGRAM OF NOVEMBER 14 EXTENDED ITS OFFER AS REQUESTED. IN A TELEGRAM OF THE SAME DATE, GST EXTENDED TO NOVEMBER 24, BUT ON NOVEMBER 22 FURTHER EXTENDED TO NOVEMBER 29. ON THE 29TH, GST AGAIN EXTENDED ITS ACCEPTANCE PERIOD TO DECEMBER 6 AND REDUCED ITS PRICE $1,800 PER BRIDGE SET. IT APPEARS THAT ALL OTHER OFFERS WERE PERMITTED TO EXPIRE ON NOVEMBER 29. GST HAD BEEN ADVISED IN THE INTERIM (DECEMBER 2) OF THE NONAVAILABILITY OF THE GAUGES. IT RESPONDED ON DECEMBER 3 WITH AN OFFER TO PROVIDE THE GAUGES AT NO COST BUT ON CONDITION THAT SUCH GAUGES WOULD REMAIN AS GST PROPERTY. HOWEVER, SINCE DCSC SPECIFIED THAT TITLE TO THE GAUGES WOULD HAVE TO VEST IN THE GOVERNMENT UPON COMPLETION OF THE CONTRACT, GST ON DECEMBER 4AGREED TO FURNISH THE GAUGES WITH TITLE VESTING IN THE GOVERNMENT.

A PREAWARD SURVEY OF GST WAS BEGUN ON DECEMBER 5, 1968. ON THE SAME DATE, DCSC REQUESTED ADDITIONAL FUNDS FROM THE MARINE CORPS TO PERMIT AN AWARD PRESUMABLY TO GST. FOUR DAYS LATER, ON DECEMBER 9, THE MARINE CORPS REDUCED ITS REQUIREMENTS FROM 11 TO EIGHT BRIDGE SETS.

THE PRIME ISSUE RAISED BY GST'S PROTEST TO OUR OFFICE INVOLVES THE MANNER IN WHICH NEGOTIATIONS HAVE BEEN CONDUCTED, WITH PARTICULAR EMPHASIS ON THE PERIOD COMMENCING DECEMBER 9, 1968. AS SET OUT ABOVE, ON DECEMBER 5, 1968, WHEN DCSC INITIATED THE PREAWARD SURVEY OF GST AND REQUESTED ADDITIONAL FUNDS FROM THE MARINE CORPS TO PERMIT AN AWARD, GST WAS THE LOWEST OFFEROR FOR THE REQUESTED 11 BRIDGE SETS. THEREAFTER, ON DECEMBER 9, 1968, THE MARINE CORPS TELEPHONICALLY ADVISED DCSC THAT EIGHT BRIDGE SETS, RATHER THAN 11, WERE REQUIRED. THIS WAS A SUBSTANTIAL CHANGE IN THE GOVERNMENT'S REQUIREMENTS AND, SINCE OFFERS HAD BEEN SOLICITED ON THE BASIS OF 11 BRIDGE SETS, DCSC TELEPHONICALLY REQUESTED GST ON DECEMBER 9, 1968, TO SUBMIT AN OFFER ON THE REVISED REQUIREMENT OF EIGHT BRIDGE SETS AND REQUIRED GST TO SUBMIT ITS OFFER RESPONSIVE TO THE REDUCED REQUIREMENT THAT VERY SAME DAY, DECEMBER 9, 1968. IN RESPONSE THERETO, GST, BY TELEGRAM OF DECEMBER 9, CONFIRMED THE TELEPHONIC REQUEST AND RESPONDED TO THE LESSENED REQUIREMENT OF EIGHT BRIDGES IN LIEU OF THE 11 BRIDGES WITH NO INCREASE IN UNIT PRICE. THEREAFTER, ON DECEMBER 11, DCSC REQUESTED THAT GST EXTEND ITS ACCEPTANCE TIME TO DECEMBER 18, WHICH GST DID WITH NO INCREASE IN PRICE.

IT WAS AT THIS POINT IN TIME (AFTER DECEMBER 9) THAT A SERIOUS ISSUE CONFRONTED DCSC. IN CONTEMPLATION OF MAKING AWARD, DCSC DETERMINED THAT AWARD SHOULD NOT BE MADE UNTIL ANOTHER ROUND OF NEGOTIATIONS HAD BEEN CONDUCTED WITH OTHER OFFERORS IN THE ZONE OF CONSIDERATION OSTENSIBLY BECAUSE:

(A) THE OFFER OF GST IN RESPONSE TO AMENDMENT 0005 HAD BEEN A "LATE OFFER" WHICH SHOULD NOT HAVE BEEN ACCEPTED AT THE TIME;

(B) THE ACTION OF DECEMBER 9, 1968, CONSTITUTED A NEW SOLICITATION FROM GST ALONE ON THE REDUCED REQUIREMENT; AND

(C) OTHER OFFERORS WHICH HAD BEEN IN THE ZONE OF CONSIDERATION ON THE BASIS OF 11 BRIDGE SETS MUST BE GIVEN EQUAL OPPORTUNITY TO SUBMIT PRICES ON THE REDUCED QUANTITY.

THE FOLLOWING SEQUENCE OF EVENTS THEN OCCURRED. ON DECEMBER 17, DCSC REQUESTED THAT GST EXTEND ITS ACCEPTANCE TIME TO JANUARY 10, 1969, AND ON DECEMBER 18 THREE OTHER OFFERORS IN A COMPETITIVE RANGE WERE REQUESTED TO EXTEND THEIR ACCEPTANCE PERIODS TO JANUARY 18, 1969. GST COMPLIED WITH THIS REQUEST. THEN, ON DECEMBER 19, 1968, DCSC REOPENED NEGOTIATIONS WITH THE THREE OTHER OFFERORS (MEC, CONSOLIDATED DIESEL ELECTRIC COMPANY AND WASHINGTON ALUMINUM COMPANY) CONSIDERED TO HAVE BEEN WITHIN THE COMPETITIVE RANGE AS A RESULT OF THEIR OFFERS FOR THE ORIGINAL 11 BRIDGE SETS. THESE FIRMS WERE REQUESTED TO SUBMIT OFFERS ON THE REDUCED REQUIREMENT OF EIGHT BRIDGE SETS BY THE CLOSE OF BUSINESS ON DECEMBER 20, 1968.

IN RESPONSE THERETO, MEC REPLIED BY TELEGRAM OF DECEMBER 20, 1968, IN WHICH IT REDUCED ITS UNIT PRICE FOR EIGHT SETS BY $10,785 PER SET, IN ADDITION TO THE $10,228.25 PER SET REDUCTION PREVIOUSLY SUBMITTED FOR 11 SETS. THIS PRICING WAS BASED ON (1) AN ALL-OR-NOTHING BASIS FOR THE ENTIRE SOLICITATION OF EIGHT SETS, AND (2) RECEIPT OF AWARD PRIOR TO JANUARY 18, 1969.

IT IS REPORTED THAT AFTER EVALUATION ON THE BASIS OF FURNISHING EIGHT BRIDGE SETS, MEC WAS FOUND TO BE THE NEW LOWEST OFFEROR AT $2,307,412.50 FOR DELIVERY ON AN F.O.B. ORIGIN BASIS PLUS FREIGHT OF $79,152 FOR A TOTAL F.O.B. ORIGIN OFFER OF $2,386,564.50, AS COMPARED TO ITS TOTAL F.O.B. DESTINATION OFFER OF $2,392,644.50. IN COMPARISON, GST'S TOTAL F.O.B. DESTINATION OFFER WAS $2,450,608, OR $64,043.50 HIGHER THAN MEC'S F.O.B. ORIGIN BID PLUS FREIGHT TO DESTINATION. THEREUPON, DCSC REQUESTED A PREAWARD SURVEY ON MEC ON DECEMBER 31, 1968, THE RESULTS OF WHICH SURVEY WERE FAVORABLE TO MEC AND LED TO FURTHER NEGOTIATIONS SOLELY WITH MEC WHICH CULMINATED IN THE CONTRACT AWARD TO MEC ON JANUARY 17, 1969. ESSENTIALLY, THE PRIME ISSUE FOR CONSIDERATION AT THIS JUNCTURE IS WHETHER THE POSITION OF GST WAS PREJUDICED BY ITS NOT HAVING BEEN SOLICITED ON DECEMBER 19, 1968, FOR ITS BEST AND FINAL OFFER, WITH THE THREE OTHER OFFERORS IN THE ZONE OF CONSIDERATION. WE THINK, UNDER THE CIRCUMSTANCES OF THIS CASE, THAT GST WAS NOT GIVEN AN EQUAL OPPORTUNITY AND ITS POSITION WAS THEREBY PREJUDICED.

PARAGRAPH 3-805.1 (A) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) REQUIRES THAT, AFTER RECEIPT OF INITIAL PROPOSALS, DISCUSSIONS BE CONDUCTED WITH ALL OFFERORS WITHIN A COMPETITIVE RANGE WITH CERTAIN EXCEPTIONS NOT HERE PERTINENT. THAT REGULATION IMPOSES AN AFFIRMATIVE DUTY TO NEGOTIATE AND, IN THIS CASE, DCSC DID IN FACT NEGOTIATE WITH THREE OTHER OFFERORS DURING THE CRUCIAL PERIOD OF DECEMBER 9 THROUGH 20, 1968. HOWEVER, ASPR 3-805.1 (B), IN ADDITION TO PROHIBITING AUCTION TECHNIQUES, PROVIDES IN PART AS FOLLOWS:

* * * WHENEVER NEGOTIATIONS ARE CONDUCTED WITH SEVERAL OFFERORS, WHILE SUCH NEGOTIATIONS MAY BE CONDUCTED SUCCESSIVELY, ALL OFFERORS SELECTED TO PARTICIPATE IN SUCH NEGOTIATIONS (SEE (A) ABOVE) SHALL BE OFFERED AN EQUITABLE OPPORTUNITY TO SUBMIT SUCH PRICE, TECHNICAL, OR OTHER REVISIONS IN THEIR PROPOSALS AS MAY RESULT FROM THE NEGOTIATIONS. ALL SUCH OFFERORS SHALL BE INFORMED OF THE SPECIFIED DATE (AND TIME IF DESIRED) OF THE CLOSING OF NEGOTIATIONS AND THAT ANY REVISIONS TO THEIR PROPOSALS MUST BE SUBMITTED BY THAT DATE. ALL SUCH OFFERORS SHALL BE INFORMED THAT ANY REVISION RECEIVED AFTER SUCH DATE SHALL BE TREATED AS A LATE PROPOSAL IN ACCORDANCE WITH THE "LATE PROPOSALS" PROVISIONS OF THE REQUEST FOR PROPOSALS. (IN THE EXCEPTIONAL CIRCUMSTANCES WHERE THE SECRETARY CONCERNED AUTHORIZES CONSIDERATION OF SUCH A LATE PROPOSAL, RESOLICITATION SHALL BE LIMITED TO THE SELECTED OFFERORS WITH WHOM NEGOTIATIONS HAVE BEEN CONDUCTED.) IN ADDITION, ALL SUCH OFFERORS SHALL ALSO BE INFORMED THAT AFTER THE SPECIFIED DATE FOR THE CLOSING OF NEGOTIATION NO INFORMATION OTHER THAN NOTICE OF UNACCEPTABILITY OF PROPOSAL, IF APPLICABLE (SEE 3- 508), WILL BE FURNISHED TO ANY OFFEROR UNTIL AWARD HAS BEEN MADE.

THE EMPHASIS HERE IS DIRECTED AT AFFORDING OFFERORS A SPECIFIED DATE, COMMON TO ALL, SIGNIFYING THE CLOSE OF NEGOTIATIONS. IN CONNECTION WITH THE FOREGOING, GST CONTENDS (AND THE RECORD SUPPORTS SUCH CONTENTION) THAT NO SPECIFIED COMMON CUTOFF DATE FOR THE CLOSE OF NEGOTIATIONS WAS ESTABLISHED FOR COMPETING OFFERORS TO THE PREJUDICE OF GST'S NEGOTIATION POSTURE.

THE LATE ACKNOWLEDGMENT OF AMENDMENT NO. 0005 BY GST HAS BEEN ADVANCED BY DCSC AS ONE REASON FOR REOPENING NEGOTIATIONS WITH THREE OFFERORS ON DECEMBER 19, 1968. HOWEVER, CONTRARY TO THAT POSITION, WE NOTE THAT ASPR 3-506 STATES:

(H) THE NORMAL REVISIONS OF PROPOSALS BY SELECTED OFFERORS OCCURRING DURING THE USUAL CONDUCT OF NEGOTIATIONS WITH SUCH OFFERORS ARE NOT TO BE CONSIDERED AS LATE PROPOSALS OR LATE MODIFICATIONS, BUT SHALL BE HANDLED IN ACCORDANCE WITH 3-805.1 (B).

HERE, GST WAS REQUESTED SEVERAL TIMES TO EXTEND THE TIME FOR ACCEPTANCE OF ITS OFFER AFTER SUBMISSION OF ITS SO-CALLED "LATE" ACKNOWLEDGMENT OF AMENDMENT NO. 0005 AND WHILE IT WAS STILL THE LOW OFFEROR, WITHOUT ADVICE THAT ITS LATE ACKNOWLEDGMENT OF THE AMENDMENT RENDERED ITS REVISED OFFER ON AMENDMENT NO. 0005 INELIGIBLE FOR CONSIDERATION. HOWEVER, IT SHOULD BE EMPHASIZED THAT NEGOTIATION PROCEDURES, UNLIKE THOSE REQUIRED FOR FORMAL ADVERTISING, ARE DESIGNED TO BE FLEXIBLE AND INFORMAL. THESE PROCEDURES PROPERLY PERMIT THE CONTRACTING OFFICER TO DO THINGS IN THE AWARDING OF A NEGOTIATED CONTRACT THAT WOULD BE CONTRARY TO THE LAW IF THE PROCUREMENT WERE BEING ACCOMPLISHED BY FORMAL ADVERTISING. SEE 47 COMP. GEN. 279, 284. THEREFORE, WE SEE NO JUSTIFICATION FOR THE ADMINISTRATIVE EMPHASIS PLACED ON A "LATE" ACKNOWLEDGMENT OF AMENDMENT NO. 0005 BY GST AS BEING ONE OF THE REASONS FOR NOT INCLUDING GST IN THE FINAL ROUND OF NEGOTIATIONS WHICH COMMENCED ON DECEMBER 19, 1968.

MORE SERIOUS IS THE FACT THAT THE CONTRACTING OFFICER EFFECTIVELY ESTABLISHED DIFFERENT CUTOFF DATES FOR GST (DECEMBER 9) AND MEC (DECEMBER 20) WHEN THE PROCUREMENT REQUIREMENTS WERE REDUCED FROM 11 TO EIGHT BRIDGE SETS. UNDER THE RULES APPLICABLE TO NEGOTIATED PROCUREMENT, NEGOTIATIONS MAY BE CONDUCTED AT DIFFERENT TIMES WITH DIFFERENT OFFERORS. HOWEVER, WHEN THIS IS DONE, THE RULES ALSO REQUIRE, IN FAIRNESS TO ALL, THAT A COMMON CUTOFF DATE BE SET FOR ALL. IN A SITUATION, SUCH AS HERE INVOLVED, WHERE A SUBSTANTIAL CHANGE OCCURRED IN THE NUMBER OF BRIDGES REQUIRED, ASPR 3-805.1 (E) REQUIRES:

(E) WHEN, DURING NEGOTIATIONS, A SUBSTANTIAL CHANGE OCCURS IN THE GOVERNMENT'S REQUIREMENTS OR A DECISION IS REACHED TO RELAX, INCREASE OR OTHERWISE MODIFY THE SCOPE OF THE WORK OR STATEMENT OF REQUIREMENTS, SUCH CHANGE OR MODIFICATION SHALL BE MADE IN WRITING AS AN AMENDMENT TO THE REQUEST FOR PROPOSAL OR REQUEST FOR QUOTATIONS, AND A COPY SHALL BE FURNISHED TO EACH PROSPECTIVE CONTRACTOR. SEE 3-505 AND 3 507. ORAL ADVICE OF CHANGE OR MODIFICATION MAY BE GIVEN IF (I) THE CHANGES INVOLVED ARE NOT COMPLEX IN NATURE, (II) ALL PROSPECTIVE CONTRACTORS ARE NOTIFIED SIMULTANEOUSLY (PREFERABLY BY A MEETING WITH THE CONTRACTING OFFICER), AND (III) A RECORD IS MADE OF THE ORAL ADVICE GIVEN. IN SUCH INSTANCES, HOWEVER, THE ORAL ADVICE SHOULD BE PROMPTLY FOLLOWED BY A WRITTEN AMENDMENT VERIFYING SUCH ORAL ADVICE PREVIOUSLY GIVEN. THE DISSEMINATION OF ORAL ADVICE OF CHANGES OR MODIFICATIONS SEPARATELY TO EACH PROSPECTIVE BIDDER DURING INDIVIDUAL NEGOTIATION SESSIONS SHOULD BE AVOIDED UNLESS PRECEDED, ACCOMPANIED, OR IMMEDIATELY FOLLOWED BY A WRITTEN AMENDMENT TO THE REQUEST FOR PROPOSAL OR REQUEST FOR QUOTATIONS EMBODYING SUCH CHANGES OR MODIFICATIONS.

WHILE WE CAN UNDERSTAND THAT THE URGENCY OF THE SITUATION MAY HAVE PRECLUDED THE ISSUANCE OF A WRITTEN AMENDMENT PRIOR TO DECEMBER 9, 1968, THE RECORD SUBMITTED HERE FAILS TO SHOW COMPLIANCE WITH THE REQUIREMENT IN SUBPARAGRAPH (II), QUOTED ABOVE, THAT ALL PROSPECTIVE CONTRACTORS BE NOTIFIED SIMULTANEOUSLY OF THE SUBSTANTIAL CHANGE IN THE GOVERNMENT'S REQUIREMENTS. IN OUR OPINION, THIS REPRESENTED A SIGNIFICANT DEFICIENCY IN THE NEGOTIATION PROCESS REVEALED BY THE CHAIN OF EVENTS LEADING TO THE AWARD MADE TO MEC. WHILE DCSC ATTEMPTS TO JUSTIFY ITS ACTION IN REOPENING NEGOTIATIONS WITH THE THREE OTHER OFFERORS ON DECEMBER 19 WITHOUT EXTENDING THE SAME OPPORTUNITY TO GST ON THE BASIS THAT GST HAD ALREADY BEEN SOLICITED FOR THE REDUCED REQUIREMENTS ON DECEMBER 9, THE FACT REMAINS THAT GST WAS LED TO BELIEVE THAT NO FURTHER NEGOTIATION ACTION ON ITS PART WAS REQUIRED OR NECESSARY AFTER DECEMBER 9. WE SEE NO REASON WHY GST COULD NOT HAVE BEEN INCLUDED IN THE DECEMBER 19 SOLICITATION AND GIVEN THE COMMON CUTOFF DATE OF DECEMBER 20 THAT WAS AFFORDED THE OTHER OFFERORS.

WE BELIEVE THE EFFECT OF THE NEGOTIATION PROCEDURES EMPLOYED BY DCSC IN THIS CASE WAS TO ESTABLISH TWO SEPARATE CUTOFF DATES (DECEMBER 9 AND 20) WHICH, AS THE SITUATION DEVELOPED, DEFINITELY OPERATED TO THE PREJUDICE OF THE COMPETITIVE POSITION OF GST. IN REGARD, WE HAVE PREVIOUSLY STATED THAT OFFERORS SHOULD BE ADVISED (1) THAT NEGOTIATIONS ARE BEING CONDUCTED; (2) THAT OFFERORS ARE BEING ASKED FOR THEIR "BEST AND FINAL" OFFER, NOT MERELY TO CONFIRM OR RECONFIRM PRIOR OFFERS; AND, FINALLY (3) THAT ANY REVISION MUST BE SUBMITTED BY THE DATE SPECIFIED. SEE 48 COMP. GEN. 536, FEBRUARY 13, 1969, AND 48 ID. 449, DECEMBER 27, 1968.

THE PARTIES DO NOT MAKE AN ISSUE OF THE EXPIRATION OF MEC'S OFFER ON SEPTEMBER 26 AND AGAIN ON NOVEMBER 29, AND NO PREJUDICE IS CLAIMED TO HAVE RESULTED FROM REVIVAL OF THE OFFERS BY EXTENSIONS GRANTED AFTER EXPIRATION. FOR THESE REASONS, AND PARTICULARLY SINCE WE HAVE INVOLVED HERE A NEGOTIATED PROCUREMENT, IT WOULD APPEAR THAT PRICES COULD BE REVISED CONCURRENTLY WITH OR FOLLOWING A TARDY EXTENSION OF THE ACCEPTANCE PERIOD WITHOUT PREJUDICE TO ANY OTHER OFFEROR OR TO THE SYSTEM OF NEGOTIATED PROCUREMENT.

ALTHOUGH DCSC HAD CONCLUDED NEGOTIATIONS WITH GST ON DECEMBER 4 RELATIVE TO THE NONAVAILABILITY OF GOVERNMENT-OWNED GAUGES, NO MENTION OF SUCH NONAVAILABILITY WAS MADE IN THE DECEMBER 19 COMMUNICATION TO THE THREE OTHER OFFERORS IN WHICH THEY WERE REQUESTED TO SUBMIT PRICES ON THE REDUCED REQUIREMENT OF EIGHT BRIDGE SETS. FOR ALL THAT APPEARS, ALL THREE OFFERORS CONTINUED TO BELIEVE THAT THE GOVERNMENT WOULD FULFILL ITS OBLIGATION TO FURNISH GAUGES AND, ON THAT ASSUMPTION, SUBMITTED THEIR REVISIONS ACCORDINGLY. KNOWLEDGE OF THE ACTUAL STATE OF AFFAIRS CONCERNING THE GAUGES REMAINED A PRIVATE MATTER BETWEEN DCSC AND GST. SEEMINGLY RELIABLE ESTIMATE OF THE VALUE OF THESE GAUGES IS ABOUT $21,000. WE THINK THAT THE DEVELOPMENTS CONCERNING THE GAUGES CONSTITUTED A "SUBSTANTIAL CHANGE" IN THE PROCUREMENT WITHIN THE MEANING OF ASPR 3- 805.1 (E) AND THAT, THEREFORE, THE FAILURE TO NOTIFY THE THREE OTHER OFFERORS ON DECEMBER 19 OF THE CURRENT FACTS REGARDING GAUGES WAS CONTRARY TO THAT SECTION.

THE ADMINISTRATIVE REPORT INDICATES THAT, WHILE THE CONTRACTING OFFICER WAS AWARE DURING THE MONTH OF DECEMBER (AND EVEN EARLIER) THAT THE GAUGES COULD NOT BE SUPPLIED BY THE GOVERNMENT, IT WAS NOT UNTIL EARLY JANUARY 1969 THAT HE LEARNED THAT MEC AND ITS SUBCONTRACTORS HAD POSSESSION OF SOME OR ALL OF THE GAUGES. THIS INFORMATION WAS PROVIDED BY MEC ITSELF IN THE FOLLOWING TELEGRAM, DATED JANUARY 2, 1969:

1. MENCO HAS OR WILL HAVE INSPECTION GAUGES IN HOUSE FOR THE CONTRACTS FOR ALL BALKS, STIFFENERS AND RAMP RAFTS. OUR SUPPLIERS FOR TRESTLE AND SADDLE ASSEMBLIES ALSO HAVE GAUGES IN HOUSE.

2. SHOULD ANY OR ALL OF THESE GAUGES NOT BE AVAILABLE FOR7400, MENCO WILL AT THE GOVERNMENT'S REQUEST, FURNISH PRICING AND DELIVERY SCHEDULE FOR SUPPLYING THE NECESSARY GAUGES. MENCO AT THAT TIME WILL ALSO REQUEST A CHANGE IN 7400 DELIVERY SCHEDULE IF NECESSARY. IT IS CLEAR FROM THE SECOND PARAGRAPH THAT MEC WAS WILLING TO SUPPLY ANY GAUGES WHICH IT MIGHT NOT POSSESS, BUT ONLY UPON CONDITION THAT THE GOVERNMENT BEAR THE COSTS THEREOF. SINCE GST HAD BEEN PERSUADED TO AGREE TO SUPPLY ALL THE GAUGES WITHOUT ADDITIONAL COST TO THE GOVERNMENT AND TO CONSENT TO A STIPULATION THAT TITLE THERETO PASS TO THE GOVERNMENT ON COMPLETION OF THE CONTRACT, IT IS NOT CLEAR THAT MEC COULD NOT HAVE BEEN INDUCED TO DO THE SAME. CONDUCT OF NEGOTIATIONS IN SUCH RESPECT COULD HAVE BEEN UNDERTAKEN DURING THAT PERIOD IN JANUARY WHEN MEC WAS INCREASING ITS PRICES AND NEGOTIATING WITH THE AGENCY TO CLARIFY CONTRACT TERMS AND TO INCORPORATE A SPECIFIC REQUIREMENT FOR FIRST ARTICLE TESTING OF COMPONENTS.

REPRESENTATIVES OF GST HAVE QUESTIONED THE EVALUATION FACTOR OF $12,000 WHICH WAS ADDED TO MEC'S PROPOSAL TO COMPENSATE FOR ITS COMPETITIVE ADVANTAGE IN POSSESSING SOME OR ALL OF THE GAUGES. TECHNICAL PERSONNEL AT FORT BELVOIR SUBMITTED, AFTER AWARD, THEIR ESTIMATE OF $21,592 FOR THE GAUGES; EVEN AT THIS HIGHER FIGURE THE MEC OFFER IS LOWER THAN GST'S. THE ADMINISTRATIVE REPORT STATES THAT THE EVALUATION FACTOR REPRESENTS THE "TOTAL COST OF THE GAGES WHICH GENERAL HAD OFFERED TO PURCHASE AND TURN OVER TO THE GOVERNMENT." WE ARE INCAPABLE OF APPRAISING THE VALUE OF THESE GAUGES SINCE WE LACK THE SPECIAL EXPERTISE NECESSARY TO MAKE SUCH AN APPRAISAL. THEREFORE, WE HAVE NO ALTERNATIVE BUT TO ACCEPT THE STATEMENT OF THE CONTRACTING AGENCY.

ITEM 3 OF THE RFP CALLED FOR "PROVISIONING AND TECHNICAL DOCUMENTATION REQUIREMENT TO BE IN ACCORDANCE WITH THE REQUIREMENTS OF DSAM 4100.1 AND ATTACHMENT 3, PAGES 1 THRU 4, STATEMENT OF PROVISIONING POLICY FOR TYPE I PROVISIONING REQUIREMENTS, DATED 31 AUG 67-- APPLICABLE TO ITEMS 1 AND 2." ITEM 4 WAS "INTERIM STOCK REPAIR PARTS" IN ACCORDANCE WITH MIL-I- 82110(MC), AS AMENDED. THE ABSTRACT OF OFFERS RECEIVED IN THIS CASE REVEALS THAT TWO OF THE SEVEN OFFERORS SUBMITTED NO PRICES FOR ITEMS 3 AND 4; THAT TWO SUBMITTED A PRICE ON ITEM 3, BUT NOT ON THE OTHER; AND THAT THREE OFFERORS SUBMITTED PRICES ON BOTH ITEMS. THERE ARE FURTHER DISCLOSED BY THE ABSTRACT THE FOLLOWING FACTS:

(1) THE PRICES SUBMITTED ON ITEM 3 RANGED FROM $25 TO $75,000; AND

(2) THE PRICES SUBMITTED ON ITEM 4 RANGED FROM $313.50 TO $2,500.

A REVIEW OF THE ATTACHMENT UNDER ITEM 3 AND THE MIL-I-82110 UNDER ITEM 4 INDICATES TO US THAT THE AMOUNTS AND PRICES FOR REPAIR PARTS AND PROVISIONING WERE TO BE NEGOTIATED BY THE GOVERNMENT AND THE CONTRACTOR AFTER AWARD. IT IS THEREFORE POSSIBLE TO CONCLUDE THAT NO PRICES WERE REQUIRED FOR THESE TWO ITEMS. THIS FACT, TAKEN TOGETHER WITH THE WIDE RANGES OF PRICES SUBMITTED AND THE FACT THAT SOME OFFERORS FAILED TO SUBMIT ANY PRICE ON ONE OR BOTH OF THESE ITEMS, INDICATES CONFUSION ON THE PART OF THE OFFERORS. SINCE PRICES STATED FOR ITEMS 3 AND 4 WERE FOR THE PURPOSE OF COMPARING THE VARIOUS OFFERS, FRUITFUL INQUIRY MIGHT WELL HAVE BEEN UNDERTAKEN TO CLARIFY THE OFFERORS' APPARENT DOUBT ON THIS MATTER AND TO PERMIT EVALUATION ON AN EQUAL BASIS. WE HAVE BEEN INFORMALLY ADVISED BY GST IN THIS CONNECTION THAT ITS $1,200 PRICE ON ITEM 4 REPRESENTS THE ESTIMATED COST OF THE INTERIM REPAIR PARTS THEMSELVES; ON THE OTHER HAND, MEC'S $313.50 FIGURE FOR THIS ITEM, WE ARE TOLD, REPRESENTS ONLY THE COST OF A COMMERCIAL PARTS LIST (WHICH IS PROVIDED FOR UNDER PARAGRAPH 3.1.1 OF MIL-I-82110). FAILURE TO NEGOTIATE WITH OFFERORS WITH RESPECT TO THE VARYING RESPONSES TO ITEMS 3 AND 4 WAS CONTRARY TO THAT PART OF ASPR PARAGRAPH 3-804 WHICH READS:

* * * ORAL DISCUSSIONS OR WRITTEN COMMUNICATIONS SHALL BE CONDUCTED WITH OFFERORS TO THE EXTENT NECESSARY TO RESOLVE UNCERTAINTIES RELATING TO THE PURCHASE OR THE PRICE TO BE PAID. * * * THE ABSTRACT OF OFFERS ITSELF DEMONSTRATES THAT THERE WAS INDEED UNCERTAINTY AMONG THE OFFERORS AS TO BOTH ITEMS 3 AND 4. GOVERNMENT PROCUREMENT BY NEGOTIATION, LIKE PROCUREMENT BY FORMAL ADVERTISING, REQUIRES THAT CONTRACTING OFFICERS OBSERVE ELEMENTAL IMPARTIALITY TOWARD ALL OFFERORS. WHILE NEGOTIATION PROCEDURES ARE MORE FLEXIBLE THAN ADVERTISED PROCEDURES, SUCH FLEXIBILITY DEMANDS A GREATER DEGREE OF CARE ON THE PART OF THE CONTRACTING OFFICER TO INSURE THAT ALL COMPETITIVE OFFERORS ARE TREATED EQUALLY. THE RECORD OF NEGOTIATIONS WITH GST, AS WELL AS WITH THE OTHER OFFERORS, POINTS UP SERIOUS DEFICIENCIES IN THE NEGOTIATION PROCESS EMPLOYED WHICH DEFINITELY WERE PREJUDICIAL TO AT LEAST GST.

THE PROCUREMENT PROCEDURES UTILIZED BY DCSC IN THIS CASE DEVIATED FROM THE REQUIREMENTS OF 10 U.S.C. 2304 (G) AND REGULATIONS SO MATERIALLY AS ORDINARILY WOULD WARRANT CANCELLATION OF THE AWARD AND THE REOPENING OF NEGOTIATIONS WITH ALL OFFERORS IN A COMPETITIVE RANGE. WE WOULD BE DISPOSED TO HOLD THAT SUCH ACTION SHOULD BE TAKEN IN THIS INSTANCE BUT FOR THE DELETERIOUS EFFECT ON OUR MILITARY POSTURE IN SOUTHEAST ASIA. THE MARINE CORPS HAS STRESSED THAT THERE IS A CRITICAL SHORTAGE OF THE PROCUREMENT REQUIREMENTS AND THAT ANY SLIPPAGE IN DELIVERY OF TACTICAL BRIDGING WILL HAVE AN UNDESIRABLE IMPACT ON III MARINE AMPHIBIOUS FORCE TACTICAL/LOGISTICAL OPERATIONS IN SOUTHEAST ASIA. THE COMMANDING GENERAL, FLEET MARINE FORCE, PACIFIC, HAS ASKED THAT EVERY EFFORT BE MADE TO PREVENT ANY SLIPPAGE IN DELIVERY OF TACTICAL BRIDGING.

A SECOND REASON MILITATING AGAINST CANCELLATION OF AWARD IS THE SUBSTANTIAL TERMINATION COSTS WHICH WOULD NOW BE INCURRED BY THE GOVERNMENT. IN THIS CONNECTION, YOU HAVE ADVISED THAT AN ATTEMPT HAS BEEN MADE TO OBTAIN FROM MEC A MUTUAL NO-COST STOPWORK AGREEMENT IN THE EVENT THE MARINE CORPS COULD AFFORD A DELAY IN THE DELIVERY OF THE BRIDGE SETS. NO SUCH AGREEMENT COULD BE OBTAINED. THE CONTRACT CONTAINS NO SUSPENSION- OF-WORK CLAUSE AND, THUS, EVEN THE ISSUANCE OF A SUSPENSION-OF-WORK ORDER COULD SUBJECT THE GOVERNMENT TO A BREACH OF CONTRACT CLAIM.

IN VIEW OF THE FOREGOING ADMINISTRATIVE PRESENTATION BY THE MARINE CORPS AND THE DEFENSE SUPPLY AGENCY, WE ARE CONSTRAINED TO TAKE NO ACTION TO DISTURB THE AWARD. HOWEVER, THIS IS NOT TO BE TAKEN AS SANCTIONING THE PROCUREMENT ACTIONS EMPLOYED BY DCSC. REPETITIONS OF THE FOREGOING DEFICIENCIES MUST BE AVOIDED, AND YOU ARE ADVISED THAT WE WILL SCRUTINIZE FUTURE PROCUREMENTS TO DETERMINE WHETHER ALL SUBSTANTIAL CHANGES OCCURRING DURING NEGOTIATIONS ARE TREATED IN ACCORDANCE WITH ASPR 3-805.1 (E) AND WHETHER ALL OFFERORS ARE NOTIFIED OF THE SPECIFIED COMMON CUTOFF DATE FOR NEGOTIATIONS UNDER ASPR 3 805.1 (B) AND ARE AFFORDED EQUAL NEGOTIATION OPPORTUNITY. THE MATTER IS BROUGHT TO YOUR ATTENTION WITH THE EXPECTATION THAT IT MAY SERVE AS A GUIDE TO CONTRACTING OFFICERS TO PRECLUDE RECURRENCES OF LIKE CASES IN THE FUTURE.