B-170181, FEB 22, 1971

B-170181: Feb 22, 1971

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BID PROTEST - EVALUATION PROCEDURES - ADEQUACY OF NEGOTIATIONS DECISION THAT PROCUREMENT OF A CRIME STUDY REQUESTED BY THE BUREAU OF NARCOTICS AND DANGEROUS DRUGS WHICH RESULTED IN A NEGOTIATED AWARD TO RESEARCH TRIANGLE INSTITUTE WAS NOT PATENTLY ILLEGAL AS ALLEGED BY PROTESTANT. THE CONCLUSION THAT THE RFP WAS DEFICIENT IN APPRISING INTERESTED OFFERORS OF ALL ASPECTS OF EVALUATION WHICH WOULD AFFECT THE ULTIMATE CHOICE OF THE CONTRACTING AGENCY DOES NOT REQUIRE GAO TO QUESTION THE AWARD OF THE CONTRACT. IT IS ALSO CLEAR THAT PROTESTANT'S PROPOSAL AS ORIGINALLY SUBMITTED WAS WITHIN A COMPETITIVE RANGE AND DISCUSSIONS OR NEGOTIATIONS SHOULD NOT HAVE BEEN CONDUCTED SOLELY WITH RTI THUS VIOLATING REGULATIONS FOR COMPETITIVE NEGOTIATION.

B-170181, FEB 22, 1971

BID PROTEST - EVALUATION PROCEDURES - ADEQUACY OF NEGOTIATIONS DECISION THAT PROCUREMENT OF A CRIME STUDY REQUESTED BY THE BUREAU OF NARCOTICS AND DANGEROUS DRUGS WHICH RESULTED IN A NEGOTIATED AWARD TO RESEARCH TRIANGLE INSTITUTE WAS NOT PATENTLY ILLEGAL AS ALLEGED BY PROTESTANT, TRACOR, INC. THE CONCLUSION THAT THE RFP WAS DEFICIENT IN APPRISING INTERESTED OFFERORS OF ALL ASPECTS OF EVALUATION WHICH WOULD AFFECT THE ULTIMATE CHOICE OF THE CONTRACTING AGENCY DOES NOT REQUIRE GAO TO QUESTION THE AWARD OF THE CONTRACT. HOWEVER, IT IS ALSO CLEAR THAT PROTESTANT'S PROPOSAL AS ORIGINALLY SUBMITTED WAS WITHIN A COMPETITIVE RANGE AND DISCUSSIONS OR NEGOTIATIONS SHOULD NOT HAVE BEEN CONDUCTED SOLELY WITH RTI THUS VIOLATING REGULATIONS FOR COMPETITIVE NEGOTIATION. WHILE GAO CANNOT CONCLUDE THAT THE CONSUMMATION OF THE AWARD WAS PATENTLY ILLEGAL APPROPRIATE ACTION SHOULD BE TAKEN TO INSURE THAT FUTURE PROCUREMENTS ARE FREE OF THE DEFECTS WHICH APPEAR IN THE PRESENT CASE.

TO THE ATTORNEY GENERAL:

WE REFER TO LETTERS DATED JULY 17 AND SEPTEMBER 3, 1970, FROM THE DIRECTOR, BUREAU OF NARCOTICS AND DANGEROUS DRUGS (BNDD), AND DOCUMENTATION SUPPLIED INFORMALLY BY THE CHIEF, CONTRACTING BRANCH, BNDD, ON DECEMBER 23, 1970, REPORTING ON THE PROTEST OF TRACOR, INC. (TRACOR), THAT THE AWARD OF A COST-PLUS-A-FIXED-FEE CONTRACT TO RESEARCH TRIANGLE INSTITUTE (RTI) UNDER REQUEST FOR PROPOSALS (RFP) NO. J-70-35 WAS "ILLEGAL" AND THE RESULTING CONTRACT "INVALID."

THE RFP WAS ISSUED PURSUANT TO A CONTRACTING OFFICER'S DETERMINATION AND FINDINGS UNDER 41 U.S.C. 252(C)(10), AS IMPLEMENTED BY FEDERAL PROCUREMENT REGULATIONS (FPR) 1-3.210(A)(13), WHICH AUTHORIZES THE NEGOTIATION OF CONTRACTS FOR SERVICES FOR WHICH IT IS IMPRACTICABLE TO OBTAIN COMPETITION. THE CIRCUMSTANCES LEADING UP TO THE AWARD OF A CONTRACT TO RTI WERE REPORTED AS FOLLOWS:

" *** ON MAY 13, 1970, THE BUREAU'S ADMINISTRATIVE SERVICES DIVISION ISSUED A REQUEST FOR PROPOSAL (RFP) NO. J-70-35 (ON A COST-PLUS-A-FIXED FEE BASIS) TO FIVE PROPOSED OFFERORS *** THE RFP WAS FOR A STUDY TO DETERMINE THE RATE OF MAJOR CRIMES COMMITTED BY DRUG ADDICTS VIS-A-VIS THE RATE OF SUCH CRIMES COMMITTED BY NON-ADDICTS. BECAUSE OF THE UNIQUE NATURE OF THE STUDY CONTEMPLATED IN THE RFP, A DETAILED COVER LETTER WAS ALSO SENT TO THE PROPOSED OFFERORS *** THE TWO FIRMS RESPONDING TO THE RFP WERE TRACOR, INC. AND RESEARCH TRIANGLE INSTITUTE (RTI). A PROPOSER'S CONFERENCE WAS HELD WITH REPRESENTATIVES OF THE TWO FIRMS ON MAY 20, 1970. NO WRITTEN QUESTIONS WERE SUBMITTED BY EITHER OFFEROR PRIOR TO THE PROPOSER'S CONFERENCE. AT THE CONFERENCE, GENERAL QUESTIONS WERE RAISED REGARDING THE PROPOSED PROCUREMENT. HOWEVER, THE QUESTIONS DID NOT REQUIRE AN AMENDMENT TO THE RFP.

"PROPOSALS WERE RECEIVED FROM BOTH FIRMS ON MAY 27, 1970. THE ORIGINAL TOTAL COST AND FIXED FEE PROPOSAL SUBMITTED BY RTI WAS $269,440; THE PROPOSAL SUBMITTED BY TRACOR WAS FOR $198,125. ON MAY 28, BOTH PROPOSALS WERE FORWARDED TO THE BUREAU'S DRUG SCIENCES DIVISION FOR TECHNICAL EVALUATION. THE TECHNICAL EVALUATION, USING THE SAME CRITERIA FOR BOTH PROPOSALS, RESULTED IN A TECHNICAL EVALUATION OF 90.5 FOR THE PROPOSAL SUBMITTED BY RTI AND 71 FOR TRACOR ***

"AS A RESULT OF THE TECHNICAL EVALUATION OF THE PROPOSAL SUBMITTED BY RTI, NEGOTIATIONS WERE INITIATED WITH THIS FIRM TO ACQUIRE REVISED COST FIGURES. THE REVISED PROPOSAL SUBMITTED BY RTI (WITH A COST-PLUS-A FIXED- FEE OF $257,791) WAS AGAIN EVALUATED FOR TECHNICAL STANDARDS AND FOUND TO BE SATISFACTORY *** THE SECOND TECHNICAL EVALUATION WAS PERFORMED BY A DIFFERENT TECHNICAL SPECIALIST THAN THE ONE WHO HAD DONE THE ORIGINAL TECHNICAL EVALUATION.

"AT THE REQUEST OF TRACOR, A MEETING WAS HELD WITH REPRESENTATIVES OF THAT FIRM TO DISCUSS THEIR PROPOSAL TO THE RFP *** SUBSEQUENTLY, TRACOR SUBMITTED A REVISED PROPOSAL (WITH A COST-PLUS-A-FIXED-FEE OF $202,690) WHICH WAS ALSO GIVEN A TECHNICAL EVALUATION *** AS IN THE CASE OF RTI'S SECOND PROPOSAL, THE SECOND TECHNICAL EVALUATION OF THE TRACOR PROPOSAL WAS PERFORMED BY A DIFFERENT TECHNICAL SPECIALIST THAN THE ONE WHO HAD DONE THE ORIGINAL TECHNICAL EVALUATION.

"THE NET RESULT OF THE SECOND TECHNICAL EVALUATIONS OF THE PROPOSALS SUBMITTED BY BOTH FIRMS WAS THAT THE RTI PROPOSALS CLEARLY INDICATED A TECHNICAL SUPERIORITY OVER THOSE SUBMITTED BY TRACOR (RTI - 87, TRACOR 73). CONSEQUENTLY, RTI WAS AWARDED THE CONTRACT ON JUNE 26, 1970 *** "

TURNING NOW TO THE FIRST OF THE FOUR BASES FOR PROTEST, TRACOR CONTENDS THAT THE "RFP FAILED TO SPECIFY THE WEIGHTS WHICH WOULD BE USED IN EVALUATING PROPOSALS."

WE NOTE IN THIS RESPECT THAT ARTICLE VI OF THE RFP, ENTITLED "STANDARDS FOR EVALUATION OF PROPOSALS," LISTS THE EVALUATION FACTORS APPLICABLE TO THE SELECTION OF A CONTRACTOR UNDER 2 HEADINGS - NON PRICE FACTORS AND PRICE EVALUATION FACTOR. HOWEVER, NO "WEIGHTS" WERE PRESCRIBED OR STATEMENTS INCLUDED WHICH COULD BE REASONABLY CONSTRUED TO HAVE ADVISED OFFERORS OF THE RELATIVE IMPORTANCE TO BE ATTACHED TO THE STIPULATED EVALUATION FACTORS. IN 49 COMP. GEN. 229, 230 (1969), IN CONSONANCE WITH OUR DECISIONS WHEREIN WE STATED THAT SOUND PROCUREMENT POLICY DICTATES THAT OFFERORS BE INFORMED NOT ONLY OF ALL EVALUATION FACTORS BUT ALSO OF THE RELATIVE IMPORTANCE OR WEIGHT OF EACH FACTOR, WE STATED:

" *** WHILE WE HAVE NEVER HELD, AND DO NOT NOW INTEND TO DO SO, THAT ANY MATHEMATICAL FORMULA IS REQUIRED TO BE USED IN THE EVALUATION PROCESS, WE BELIEVE THAT WHEN IT IS INTENDED THAT NUMERICAL RATINGS WILL BE EMPLOYED OFFERORS SHOULD BE INFORMED OF AT LEAST THE MAJOR FACTORS TO BE CONSIDERED AND THE BROAD SCHEME OF SCORING TO BE EMPLOYED. WHETHER OR NOT NUMERICAL RATINGS ARE TO BE USED, WE BELIEVE THAT NOTICE SHOULD BE GIVEN AS TO ANY MINIMUM STANDARDS WHICH WILL BE REQUIRED AS TO ANY PARTICULAR ELEMENT OF EVALUATION, AS WELL AS REASONABLY DEFINITE INFORMATION AS TO THE DEGREE OF IMPORTANCE TO BE ACCORDED TO PARTICULAR FACTORS IN RELATION TO EACH OTHER. *** "

SEE ALSO, B-169645, JULY 24, 1970, 50 COMP. GEN. ; B-169429, AUGUST 21, 1970, 50 COMP. GEN.

; AND FPR 1-3.802(C). HOWEVER, AS WILL BE NOTED FROM A READING OF THOSE DECISIONS, THE FAILURE TO INFORM OFFERORS OF EVALUATION CRITERIA AND THEIR RELATIVE WEIGHTS WOULD NOT REQUIRE OUR OFFICE TO QUESTION THE AWARD OF THE CONTRACT.

WE NEXT TURN TO TRACOR'S CONTENTION THAT BNDD FAILED TO CONDUCT MEANINGFUL NEGOTIATIONS WHICH "EFFECTIVELY DEPRIVED TRACOR OF ANY REAL CHANCE TO COMPETE FOR THIS CONTRACT." WE NOTE FROM THE RECORD THAT BNDD DID NOT CONDUCT NEGOTIATIONS OR DISCUSSIONS WITH TRACOR SUBSEQUENT TO THE TECHNICAL EVALUATION OF ITS PROPOSAL, EXCEPT "UPON TRACOR'S INSISTENCE." THE BASIS FOR DISCUSSIONS ONLY WITH RTI IS REPORTED AS FOLLOWS:

"THE DIFFERENCE IN TECHNICAL COMPETENCE AND RESOURCES OFFERED FOR APPLICATION TO THE CONTRACT WORK PROJECT BETWEEN THE TWO OFFERORS WAS SO GREAT THAT IT WAS DECIDED TO NEGOTIATE INITIALLY WITH RTI *** FOR THE FOLLOWING REASONS:

"1. RTI HAD SUBMITTED THE PROPOSAL MOST TECHNICALLY ACCEPTABLE AND THE ONLY ONE WHICH APPEARED TO FULLY SATISFY THE NEEDS OF THE BUREAU.

"2. A CONTRACT UTILIZING THE FUNDS ALLOTTED TO THE PROPOSED WORK PROJECT WOULD HAVE TO BE AWARDED BY JUNE 30, 1970, AND TIME WAS OF THE ESSENCE.

"TO ALLOW FOR POSSIBLE REVISION OF PROPOSALS BY OFFERORS, AND EVALUATION AND NEGOTIATION OF THESE PROPOSALS, IT WAS OF THE UTMOST IMPORTANCE THAT PROPOSALS BE SUBMITTED INITIALLY ON THE MOST FAVORABLE TERMS THAT COULD BE OFFERED TO THE GOVERNMENT (AS REQUIRED BY THE SF 33A AND FORWARDING LETTER OF THE RFP) IN ORDER TO UTILIZE THE TIME REMAINING FOR FINAL NEGOTIATION OF PROPOSALS IN THE MOST EFFECTIVE MANNER POSSIBLE. THE INITIAL TRACOR PROPOSAL WAS NOT SUBMITTED ON THE MOST FAVORABLE TERMS TO THE GOVERNMENT THAT COULD BE OFFERED, AS WAS LATER ADMITTED BY TRACOR DURING THE MEETING OF JUNE 18, 1970 *** AND WAS DEMONSTRATED BY SUBMISSION OF A REVISED PROPOSAL WHICH AGAIN WAS NOT SUBMITTED ON THE BEST POSSIBLE TERMS TO THE GOVERNMENT AS INDICATED BY THE TECHNICAL EVALUATION OF SAME. ON THE OTHER HAND, THE INITIAL RTI PROPOSAL WAS EXTREMELY SATISFACTORY IN EVERY RESPECT, AND NEGOTIATIONS WERE, THEREFORE, CONDUCTED WITH RTI PRINCIPALLY TO EFFECT DESIRED REDUCTIONS IN THE PROPOSED LEVELS OF EFFORT AND RESULTANT REDUCTIONS IN THEIR COST PROPOSAL, WHERE FEASIBLE AND PROPER ***

THE FIRST PARAGRAPH OF ARTICLE VI OF THE RFP STATES, IN PERTINENT PART, AS FOLLOWS:

"AFTER RECEIPT OF INITIAL PROPOSALS, WRITTEN OR ORAL DISCUSSIONS MAY BE CONDUCTED WITH ALL RESPONSIVE OFFERORS WHO HAVE SUBMITTED PROPOSALS WHICH ARE TECHNICALLY AND OTHERWISE ADEQUATE AND WITHIN COMPETITIVE PRICE RANGE. *** " THIS PARAGRAPH IS IN CONSONANCE WITH THE LANGUAGE OF FPR 1- 3.805-1(A) WHICH REPEATS THE COMPETITIVE NEGOTIATION REQUIREMENTS OF 10 U.S.C. 2304(G) AS IMPLEMENTED BY ARMED SERVICES PROCUREMENT REGULATION 3- 805, AS FOLLOWS:

"(A) AFTER RECEIPT OF INITIAL PROPOSALS, WRITTEN OR ORAL DISCUSSIONS SHALL BE CONDUCTED WITH ALL RESPONSIBLE OFFERORS WHO SUBMITTED PROPOSALS WITHIN A COMPETITIVE RANGE, PRICE AND OTHER FACTORS CONSIDERED, EXCEPT THAT THIS REQUIREMENT NEED NOT NECESSARILY BE APPLIED TO:

"(5) PROCUREMENTS IN WHICH IT CAN BE CLEARLY DEMONSTRATED FROM THE EXISTENCE OF ADEQUATE COMPETITION OR ACCURATE PRIOR COST EXPERIENCE WITH THE PRODUCT OR SERVICE THAT ACCEPTANCE OF THE MOST FAVORABLE INITIAL PROPOSAL WITHOUT DISCUSSION WOULD RESULT IN A FAIR AND REASONABLE PRICE: PROVIDED, THAT THE REQUEST FOR PROPOSALS CONTAINS A NOTICE TO ALL OFFERORS OF THE POSSIBILITY THAT AWARD MAY BE MADE WITHOUT DISCUSSION OF PROPOSALS RECEIVED AND, HENCE, THAT PROPOSALS SHOULD BE SUBMITTED INITIALLY ON THE MOST FAVORABLE TERMS, FROM A PRICE AND TECHNICAL STANDPOINT, WHICH THE OFFEROR CAN SUBMIT TO THE GOVERNMENT *** " THE DEPUTY CHIEF, DRUG SCIENCES DIVISION, BNDD, IN HER JUNE 22, 1970 EVALUATION OF TRACOR'S REVISED PROPOSAL ADMITS THAT TRACOR'S INITIAL PROPOSAL WAS TECHNICALLY ACCEPTABLE, AS DOES HER MEMORANDUM OF THE "NEGOTIATIONS" EVENTUALLY HELD WITH TRACOR. HENCE, IT APPEARS FROM THE RECORD THAT TRACOR'S PROPOSAL AS INITIALLY SUBMITTED WAS WITHIN A COMPETITIVE RANGE, PRICE AND OTHER FACTORS CONSIDERED. SUCH BEING THE CASE, DISCUSSIONS OR NEGOTIATIONS SHOULD NOT HAVE BEEN CONDUCTED SOLELY WITH RTI ON THE BASIS THAT IT HAD SUBMITTED THE MOST ADVANTAGEOUS INITIAL PROPOSAL. THE FACT THAT COST MAY NOT HAVE BEEN THE CONTROLLING FACTOR IN THE AWARD OF THE CONTRACT TO RTI WHICH HAD SUBMITTED THE MOST ADVANTAGEOUS PROPOSAL DID NOT RELIEVE THE PROCUREMENT AGENCY FROM ITS OBLIGATION TO CONDUCT NEGOTIATIONS WITH TRACOR WHICH HAD SUBMITTED A COMPETITIVE PROPOSAL. SEE B-169429, SUPRA; 45 COMP. GEN. 417, 426, 427 (1966); 46 ID. 191, 192 (1966).

THE RFP AND ITS INTRODUCTORY LETTER, PURSUANT TO FPR 1-3.805-1(A)(5), PERMITTED AWARD TO BE MADE ON AN INITIAL PROPOSAL BASIS WITHOUT DISCUSSION. HOWEVER, WHERE, AS HERE, ONCE DISCUSSIONS HAVE TAKEN PLACE WITH ANY OFFEROR WHO HAS MADE A REVISION IN PRICE, AWARD MAY NO LONGER BE MADE ON THE BASIS OF AN INITIAL PROPOSAL; RATHER, DISCUSSIONS MUST BE CONDUCTED WITH ALL OFFERORS WITHIN A COMPETITIVE RANGE. SEE B 169148, OCTOBER 6, 1970, 50 COMP. GEN. .

AT TRACOR'S INSISTENCE, A MEETING WAS HELD BETWEEN BNDD AND TRACOR ON JUNE 18, 1970, RESULTING IN THE SUBMISSION OF A REVISED PROPOSAL. HOWEVER, TRACOR CLAIMS THAT THE MEETING DID NOT CONSTITUTE MEANINGFUL NEGOTIATIONS BECAUSE:

"THE 'DISCUSSIONS' WHICH WERE IN FACT HELD FELL FAR SHORT OF QUALIFYING FOR THE NAME 'NEGOTIATIONS.' ESSENTIALLY THE 'DISCUSSIONS' CONSISTED OF GOING THROUGH THE MOTIONS OF TALKING TO TRACOR WITHOUT ENDANGERING THE PREDETERMINED SELECTION OF RTI. VAGUE, GENERALIZED STATEMENTS WERE MADE TO TRACOR TO THE EFFECT THAT ITS PROPOSAL, THOUGH TECHNICALLY ACCEPTABLE, WAS INFERIOR TO RTI'S. THE BUREAU REFUSED TO IDENTIFY SPECIFIC ALLEGED DEFICIENCIES WITH ENOUGH PARTICULARITY TO PERMIT TRACOR A FAIR CHANCE TO REMEDY THEM. INDEED, THE BUREAU'S OWN INTERNAL EVALUATION EVEN FAILS TO IDENTIFY SPECIFIC DEFICIENCIES WITH PARTICULARITY, *** SO IT IS OBVIOUS THAT SPECIFIC DEFICIENCIES COULD NOT HAVE BEEN STATED TO TRACOR. ***

"FURTHERMORE, THE BUREAU NEVER MADE ANY ATTEMPT TO DETERMINE THROUGH DISCUSSIONS WHETHER TRACOR'S LOWER COST ESTIMATE WAS REALISTIC. DR. HARWOOD'S JUNE 22, 1970 MEMORANDUM *** STATES: 'THE TRACOR PROPOSAL IS SLIGHTLY LOWER, BUT IN THE ABSENCE OF DETAIL REGARDING THE ANALYSIS IT MAY NOT REALLY BE LOWER THAN THAT OF THE OTHER RESPONDENT.' IN THE FIRST PLACE, THE DIFFERENCE BETWEEN $269,440 (RTI) AND $198,125 (TRACOR) IS MORE THAN SLIGHT.* IT ALSO SEEMS TO US HIGHLY IMPROPER FOR THE BUREAU TO SPECULATE WHETHER TRACOR'S ESTIMATE WAS REALISTIC WHEN A SIMPLE DISCUSSION WITH TRACOR WOULD READILY HAVE DISCLOSED WHETHER TRACOR HAD ALREADY ACCOUNTED, IN ITS ESTIMATED COST, FOR ADEQUATE ANALYSIS. FINALLY, TRACOR DID IN FACT INCLUDE ANALYSIS IN ITS PROPOSAL ***

"*RTI'S ESTIMATED COST WAS $71,315 HIGHER THAN TRACOR'S, I.E., 35.96 PERCENT MORE." BNDD'S ACCOUNT OF THE JUNE 18 MEETING IS AS FOLLOWS:

"MR. RUDMOSE (TRACOR) STATED THAT THE PROPOSAL SUBMITTED WAS NOT DETAILED DUE TO THE COMPANY POLICY ALLOWING, DUE TO ECONOMY PROGRAMS, LIMITED AMOUNTS OF TIME AND MONEY IN PREPARATION OF THEIR SUBMISSION. THIS WAS NOTWITHSTANDING THE FACT THAT THE SF33A (RFP) AND FORWARDING LETTER FOR SAME ADVISED ALL PROPOSERS THAT THE GOVERNMENT WAS RESERVING THE RIGHT TO REJECT ANY OR ALL PROPOSALS RECEIVED IF SUCH ACTION WAS DEEMED TO BE IN THE BEST INTERESTS OF THE GOVERNMENT AND ACCORDINGLY, IT WAS OF PRIMARY IMPORTANCE THAT PROPOSALS BE SUBMITTED INITIALLY ON THE MOST FAVORABLE TERMS TO THE GOVERNMENT. IT WAS FURTHER STATED BY MR. RUDMOSE THAT HE EXPECTED TO ENHANCE TRACOR'S PROPOSAL DURING A SUBSEQUENT CONFERENCE; HENCE, THIS MEETING.

"IN RESPONSE TO QUESTIONS, BNDD PERSONNEL ADVISED TRACOR THAT, WHILE THEIR PROPOSAL WAS TECHNICALLY FEASIBLE, IT DID NOT FULLY, FROM A TECHNICAL STANDPOINT, SATISFY THE NEEDS OF THE BUREAU AND WAS NOT COMPARABLE TO THE PROPOSAL RECEIVED FROM RTI. SPECIFIC AREAS POINTED OUT WERE ORIGINALITY, CONCEPTUALIZATION OF THE PROBLEM, METHODOLOGY, AND TRAINING AND EXPERIENCE OF THE PROFESSIONAL STAFF. IT WAS IMPOSSIBLE TO EXPLAIN THE DIFFERENCE IN THE TWO PROPOSALS IN GREAT DETAIL WITHOUT DIVULGING METHODS THAT WERE ORIGINATED BY RTI AND THUS, DISCUSSIONS REGARDING THE WEAK POINTS OF TRACOR'S PROPOSAL WERE GENERAL IN NATURE. HOWEVER, MRS. BERG DID DISCUSS THE TECHNICAL EVALUATION RATING FACTORS USED BY HER RELATIVE TO TRACOR'S AND RTI'S PROPOSALS, AND CITED THE TECHNICAL POINTS WHICH LED TO DIFFERENTIAL POINT TOTALS ON THE RATING SCALE, FOR BOTH PROPOSALS. "GENERAL DISCUSSIONS REGARDING THE MATTER THEN ENSUED UNTIL AGREEMENT WAS REACHED THAT TRACOR WOULD SUBMIT A REVISED PROPOSAL SUPPLYING A MORE DETAILED APPROACH ESPECIALLY IN THE AREAS DISCUSSED DURING THE MEETING. THIS REVISED PROPOSAL WAS REQUIRED TO BE RECEIVED BY BNDD, MR. SINGER, BY JUNE 22, 1970 BECAUSE TIME WAS OF THE ESSENCE DUE TO THE CLOSE PROXIMITY OF THE FISCAL YEAR END, AND AWARD OF THE CONTRACT WAS TO BE MADE AS SOON AS POSSIBLE."

IN ADDITION, THE DEPUTY CHIEF, IN HER JUNE 22 MEMORANDUM DISCUSSED THE JUNE 18 MEETING:

"IN RESPONSE TO QUESTIONS BNDD TOLD THE TRACOR GROUP THAT THEIR PROPOSAL WAS RESPONSIVE TO THE RFP AND THAT IT WAS TECHNICALLY WITHIN THE LIMIT OF BNDD NEEDS. HOWEVER, IN COMPARISON TO THE PROPOSAL SUBMITTED BY THE OTHER OFFEROR, THE TRACOR PROPOSAL HAD SCORED LESS POINTS WHEN EVALUATED INDEPENDENTLY BY TWO DIFFERENT MEMBERS OF THE PROFESSIONAL STAFF OF THE DIVISION OF DRUG SCIENCES. THE SPECIFIC AREAS WERE POINTED OUT AS: ORIGINALITY, CONCEPTUALIZATION OF THE PROBLEM, METHODOLOGY, AND TRAINING AND EXPERIENCE OF THE PROFESSIONAL STAFF.

"TRACOR EXPLAINED THAT THE PROPOSAL WHICH THEY SUBMITTED WAS NOT DETAILED BECAUSE COMPANY POLICY ALLOWS THEM TO SPEND ONLY A CERTAIN AMOUNT OF TIME PREPARING THE SUBMISSION. THEY EXPECT TO ENHANCE THEIR PROPOSAL BY A CONFERENCE AND SO THEY REQUESTED THIS MEETING.

"MUCH DISCUSSION CENTERED AROUND THE WEAK POINTS OF THE TRACOR PROPOSAL. MRS. BERG POINTED OUT THE TECHNICAL POINTS WHICH LED TO DIFFERENTIAL POINT TOTALS ON THE RATING SCALE FOR THE TWO PROPOSALS.

"THE MEETING ADJOURNED AT ABOUT 4:15 P.M., WITH THE UNDERSTANDING THAT TRACOR WOULD SUBMIT BY MONDAY, 22 JUNE, 1970, A REVISED PROPOSAL SUPPLYING MORE DETAIL AND A MORE SOPHISTICATED APPROACH TO THE POINTS RAISED DURING THE DISCUSSION."

IN B-169429, SUPRA, WE DISCUSSED THE SCOPE AND NTURE OF DISCUSSIONS AS CONTEMPLATED BY FPR 1-3.805-1:

"FPR 1-3.805-1 REQUIRES THAT DISCUSSIONS BE CONDUCTED WITH ALL OFFERORS WITHIN A COMPETITIVE RANGE, PRICE AND OTHER FACTORS CONSIDERED. IT IS A WELL-ESTABLISHED PRINCIPLE IN FEDERAL PROCUREMENTS THAT SUCH DISCUSSIONS MUST BE MEANINGFUL AND FURNISH INFORMATION TO ALL OFFERORS WITHIN THE COMPETITIVE RANGE AS TO THE AREAS IN WHICH THEIR PROPOSALS ARE BELIEVED TO BE DEFICIENT SO THAT COMPETITIVE OFFERORS ARE GIVEN AN OPPORTUNITY TO FULLY SATISFY THE GOVERNMENT'S REQUIREMENTS. 47 COMP. GEN. 336 (1967). WHEN NEGOTIATIONS ARE CONDUCTED, THE FACT THAT INITIAL PROPOSALS MAY BE RATED AS ACCEPTABLE DOES NOT INVALIDATE THE NECESSITY FOR DISCUSSIONS OF THEIR WEAKNESSES, EXCESSES OR DEFICIENCIES IN ORDER THAT THE CONTRACTING OFFICER MAY OBTAIN THAT CONTRACT WHICH IS MOST ADVANTAGEOUS TO THE GOVERNMENT. WE HAVE STATED THAT DISCUSSIONS OF THIS NATURE SHOULD BE CONDUCTED WHENEVER IT IS ESSENTIAL TO OBTAIN INFORMATION NECESSARY TO EVALUATE A PROPOSAL OR TO ENABLE THE OFFEROR TO UPGRADE THE PROPOSAL. THUS, WHERE AN OFFEROR FAILED TO PASS A BENCHMARK TEST, THAT FACTOR ALONE SHOULD NOT HAVE PRECLUDED DISCUSSIONS TO DETERMINE WHETHER THE PROPOSAL COULD BE IMPROVED. 47 COMP. GEN. 29 (1967). MOREOVER, WE HAVE HELD THAT MEANINGFUL DISCUSSIONS MUST BE CONDUCTED WITH CONCERNS IN A COMPETITIVE RANGE EVEN IN THE NEGOTIATION OF RESEARCH AND DEVELOPMENT CONTRACTS WHERE THE OFFEROR'S TECHNICAL APPROACH AND EXPERIENCE ARE OF CRITICAL IMPORTANCE, AND CONFORMITY WITH DETAILED SPECIFICATIONS IS NOT THE STANDARD FOR AWARD. B-168485, MARCH 30, 1970."

WE CONCLUDE FROM OUR REVIEW OF THE RECORD THAT THE JUNE 18 MEETING WITH TRACOR DID CONSTITUTE NEGOTIATION WITHIN THE PREVIEW OF FPR SEC. 1 3.805- 1, ESPECIALLY SINCE TRACOR DID SUBMIT A REVISED PROPOSAL APPARENTLY DIRECTED TO SEVERAL OF THE MATTERS DISCUSSED AT THE JUNE 18 MEETING. UNFORTUNATELY, IN VIEW OF THE CONFLICTING ACCOUNTS OF THAT MEETING, AND IN VIEW OF THE ABSENCE OF EVIDENCE SUFFICIENTLY CONVINCING TO OVERCOME THE PRESUMPTION OF THE CORRECTNESS OF THE DIRECTOR'S REPORT, WE MUST RESOLVE THESE CONFLICTS IN FAVOR OF BNDD. B-170142, OCTOBER 22, 1970. ADDITION, WE HAVE RECOGNIZED THAT THE NEGOTIATION PROCESS IS OF NECESSITY FLEXIBLE IN THAT CONTRACTING OFFICIALS HAVE WIDE DISCRETION IN DETERMINING THE NATURE AND SCOPE OF NEGOTIATIONS. SEE 47 COMP. GEN. 279, 284 (1967). WITH THAT IN MIND, WE CANNOT SAY THAT BNDD DID NOT AFFORD TRACOR AN EQUITABLE OPPORTUNITY TO BETTER ITS PROPOSAL FROM A TECHNICAL STANDPOINT DURING THE JUNE 18 MEETING.

TRACOR ALSO ARGUES THAT NO COMMON CLOSING DATE WAS ESTABLISHED TO EFFECTIVELY PRECLUDE FURTHER NEGOTIATIONS. IT CONTENDS THAT:

" *** THERE MAY EVEN HAVE BEEN NEGOTIATIONS WITH RTI AFTER THE MEETING WITH TRACOR AND AFTER TRACOR'S SUBMISSION OF ITS TECHNICAL ADDENDUM AND REVISED COST PROPOSAL. BE THAT AS IT MAY HOWEVER, THE ABSENCE OF A COMMON CLOSING DATE IS ILLEGAL AND PREJUDICIAL, AS HELD BY NUMEROUS DECISIONS OF YOUR OFFICE, *** "

IT IS OBVIOUS FROM THE RECORD THAT THERE WAS A FAILURE TO ESTABLISH A COMMON CUTOFF DATE. THE FAILURE TO NEGOTIATE WITH TRACOR, INITIALLY, OBVIATED THE NECESSITY FOR THE ESTABLISHMENT OF A COMMON CUTOFF DATE. MOREOVER, THE RECORD INDICATES THAT RTI WAS NOT AFFORDED AN OPPORTUNITY TO NEGOTIATE WITH BNDD SUBSEQUENT TO THE JUNE 18 NEGOTIATION MEETING WITH TRACOR BECAUSE THE LAST DISCUSSIONS WITH RTI OCCURRED ON JUNE 12, 1970.

LASTLY, TRACOR CONTENDS THAT THE EVALUATION OF THE PROPOSALS RESULTING IN THE AWARD OF THE CONTRACT TO RTI WAS DEFICIENT IN THAT (1) BNDD FAILED TO CONSIDER TRACOR'S LOWER ESTIMATED COST; AND (2) THAT BNDD'S EVALUATION OF THE TRACOR PROPOSAL AS INFERIOR WAS ARBITRARY AND CAPRICIOUS. WE DO NOT AGREE THAT BNDD FAILED TO GIVE TRACOR'S ESTIMATED COST ANY CONSIDERATION IN ITS EVALUATION. THE JUNE 22 EVALUATION BY THE DEPUTY CHIEF OF TRACOR'S REVISED PROPOSAL CONTAINS THE FOLLOWING STATEMENT:

" *** TRACOR DOES NOT PRESENT THE MOST ACCEPTABLE TERMS. THE TRACOR PROPOSAL IS SLIGHTLY LOWER, BUT IN THE ABSENCE OF DETAIL REGARDING THE ANALYSIS IT MAY NOT REALLY BE LOWER THAN THAT OF (RTI) *** "

WE CAN UNDERSTAND TRACOR'S CONCERN THAT THE ESTIMATED COST DIFFERENTIAL IS "MORE THAN SLIGHT" AND THAT "IT ALSO SEEMS TO US HIGHLY IMPROPER FOR (BNDD) *** TO SPECULATE WHETHER TRACOR'S ESTIMATE WAS REALISTIC WHEN A SIMPLE DISCUSSION WITH TRACOR WOULD READILY HAVE DISCLOSED WHETHER TRACOR HAD ALREADY ACCOUNTED, IN ITS ESTIMATED COST, FOR ADEQUATE ANALYSIS." BNDD JUSTIFIES THE FAILURE TO CONTINUE NEGOTIATIONS BY STATING:

"AS A RESULT OF THE EXTREMELY SHORT TIME PERIOD REMAINING WITHIN WHICH TO AWARD A CONTRACT, IT WAS DECIDED THAT NO FURTHER NEGOTIATIONS WOULD BE CONDUCTED WITH TRACOR AND THE CONTRACT WOULD BE AWARDED TO RTI. *** " WE BELIEVE THAT THE FOREGOING DOES NOT JUSTIFY THE FAILURE TO EXTEND NEGOTIATION OPPORTUNITY TO TRACOR, SINCE, WE BELIEVE THAT "DETAIL" RELATING TO ITS COST PROPOSAL COULD HAVE BEEN FURNISHED ON A TIMELY BASIS HAD MEANINGFUL DISCUSSIONS BEEN CONDUCTED. SEE 47 COMP. GEN. 336, 342, 343 (1967).

CONCERNING TRACOR'S STRONG DISAGREEMENT WITH THE DETERMINATION THAT ITS PROPOSAL WAS TECHNICALLY INFERIOR TO RTI, WE HAVE CAREFULLY REVIEWED THE RECORD OF NEGOTIATIONS AND WE FIND NO SUBSTANTIAL BASIS TO QUESTION THE EVALUATION OF ITS TECHNICAL PROPOSAL. SEE B-170534, OCTOBER 6, 1970. BUT WE CANNOT CONCLUDE THAT THIS PROCUREMENT, AS CONSUMMATED, MET ALL THE REQUIREMENTS IMPOSED BY REGULATION FOR "COMPETITIVE" NEGOTIATION. INDICATED ABOVE, WE BELIEVE THAT THE RFP WAS DEFICIENT IN APPRISING INTERESTED OFFERORS OF ALL ASPECTS OF EVALUATION WHICH WOULD AFFECT THE ULTIMATE CHOICE OF BNDD. ALSO, THE CONDUCT OF NEGOTIATIONS DISCLOSED, IN SEVERAL RESPECTS, LESS THAN AN ARTFUL EXHIBITION OF SOUND NEGOTIATION TECHNIQUES. HOWEVER, AS A MATTER OF LAW, WE ARE UNABLE TO CONCLUDE THAT THE CONSUMMATION OF THE AWARD TO RTI WAS PATENTLY ILLEGAL. WE VIEW THE AWARD TO RTI AS REFLECTING A DETERMINATION THAT THE COST PREMIUM INVOLVED WAS JUSTIFIED TAKING INTO ACCOUNT THE SIGNIFICANT TECHNICAL SUPERIORITY OF RTI'S PROPOSAL. SEE B-169148, SUPRA. THEREFORE, WE STRONGLY RECOMMEND THAT APPROPRIATE ACTION BE TAKEN TO INSURE THAT IN FUTURE PROCUREMENTS THE DEFECTS OF THIS PROCUREMENT ARE AVOIDED.