B-170386, OCT. 28, 1970

B-170386: Oct 28, 1970

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WHERE CONTRACTING OFFICER HAS ISSUED A DETERMINATION AND FINDINGS AUTHORIZING NEGOTIATION WITH SUCCESSFUL COMPANY UNDER A SOLE-SOURCE SOLICITATION SUCH ACTION IS FINAL AND GAO IS WITHOUT AUTHORITY TO QUESTION SUCH A DETERMINATION UNLESS THERE IS EVIDENCE THAT IT WAS CAPRICIOUS. A RECORD THAT DISCLOSES THAT PROTESTANT WAS FURNISHED A COPY OF THE SOLICITATION AND SUBMITTED A BID. SPECTRAN ELECTRONICS DIVISION: FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 16. YOU CONTEND THAT IT WAS IMPROPER TO HAVE ISSUED THE SOLICITATION ON A SOLE-SOURCE BASIS. WHILE YOUR FIRM WAS SUBSEQUENTLY PERMITTED TO SUBMIT A PROPOSAL. YOU CONTEND IT WAS IMPROPER THEREAFTER NOT TO HAVE NEGOTIATED WITH YOUR FIRM.

B-170386, OCT. 28, 1970

BID PROTEST - SOLE-SOURCE BASIS DENIAL OF PROTEST AGAINST SOLE-SOURCE SOLICITATION FOR A SPECTRUM ANALYZER/RECORDER ISSUED BY WHITE SANDS MISSILE RANGE AND NEGOTIATED AWARD TO ACTON LABORATORIES, INC. WHERE CONTRACTING OFFICER HAS ISSUED A DETERMINATION AND FINDINGS AUTHORIZING NEGOTIATION WITH SUCCESSFUL COMPANY UNDER A SOLE-SOURCE SOLICITATION SUCH ACTION IS FINAL AND GAO IS WITHOUT AUTHORITY TO QUESTION SUCH A DETERMINATION UNLESS THERE IS EVIDENCE THAT IT WAS CAPRICIOUS, ARBITRARY, OR NOT SUPPORTED BY SUBSTANTIAL EVIDENCE. A RECORD THAT DISCLOSES THAT PROTESTANT WAS FURNISHED A COPY OF THE SOLICITATION AND SUBMITTED A BID, REJECTED BECAUSE THE PROPOSED MODEL DID NOT MEET THE REQUIREMENTS OF COMPACT SIZE, THAT THE HANDBOOK DID NOT INDICATE ANY ALTERNATIVE CONFIGURATION FOR THE EQUIPMENT, AND THAT THE PROPOSED DELIVERY SCHEDULE DID NOT CLEARLY FALL WITHIN THE PERIOD SPECIFIED IN THE SOLICITATION, SUBSTANTIATES THE ACTION AWARDING THE CONTRACT TO ACTON LABORATORIES, INC.

TO NOVATRONICS, INC., SPECTRAN ELECTRONICS DIVISION:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 16, 1970, PROTESTING AGAINST THE AWARD OF A CONTRACT FOR A SPECTRUM ANALYZER/RECORDER GROUP FROM ACTON LABORATORIES, INC. (ACTON) BY THE PURCHASING AND CONTRACTING DIRECTORATE, WHITE SANDS MISSILE RANGE, NEW MEXICO, UNDER REQUEST FOR PROPOSALS NO. DAAD07-70-R-0151.

YOU CONTEND THAT IT WAS IMPROPER TO HAVE ISSUED THE SOLICITATION ON A SOLE-SOURCE BASIS, IN THE FIRST INSTANCE AND, WHILE YOUR FIRM WAS SUBSEQUENTLY PERMITTED TO SUBMIT A PROPOSAL, YOU CONTEND IT WAS IMPROPER THEREAFTER NOT TO HAVE NEGOTIATED WITH YOUR FIRM, BECAUSE YOU COULD HAVE OFFERED A PRODUCT WHICH WOULD HAVE MET THE AGENCY'S REQUIREMENTS. YOU ALSO CONTEND THAT ACTON IS USING A "DUAL PRICE STRUCTURE" IN ITS SALES TO THE GOVERNMENT.

THE ADMINISTRATIVE REPORT TO THIS OFFICE ADVISES THAT EARLY IN 1970 WHITE SANDS MISSILE RANGE ESTABLISHED A REQUIREMENT FOR A SPECTRUM ANALYZER/RECORDER GROUP TO BE MOUNTED IN AN INSTRUMENTATION VAN. WORKING GROUP OF REPRESENTATIVES FROM THE ARMY TEST & EVALUATION COMMAND (USATECOM), ABERDEEN PROVING GROUND, JEFFERSON PROVING GROUND, YUMA PROVING GROUND AND WHITE SANDS MISSILE RANGE, AFTER RESEARCHING THE AVAILABLE LITERATURE ON SUCH EQUIPMENT, CONCLUDED THAT THE ACTON MODEL 26- 10.5K SPECTRUM ANALYZER/RECORDER GROUP WITH CERTAIN OPTIONS WAS THE ONLY MODEL CAPABLE OF MEETING WHITE SANDS' REQUIREMENTS.

IN VIEW OF THIS ADVICE, ON APRIL 21, 1970, THE CONTRACTING OFFICER ISSUED A DETERMINATION AND FINDINGS AUTHORIZING NEGOTIATION WITH ACTON UNDER 10 U.S.C. 2304(A)(10), AS IMPLEMENTED BY ARMED SERVICES PROCUREMENT REGULATION (ASPR) 3-210.2(I). THE DETERMINATION AND FINDINGS STATED IN PART:

"2. PROCUREMENT BY NEGOTIATION OF THE ABOVE DESCRIBED EQUIPMENT IS NECESSARY BECAUSE, AT THE PRESENT TIME, ONLY (ACTON) IS MARKETING A SPECTRUM ANALYZER/RECORDER GROUP WHICH INCORPORATES ALL OF THE REQUIRED FEATURES. PRODUCTS OF OTHER MANUFACTURERS EITHER DO NOT CONTAIN THESE FEATURES OR ARE UNSUITABLE FOR USE IN LIMITED VAN SPACE.

"3. USE OF FORMAL ADVERTISING FOR PROCUREMENT OF THE ABOVE DESCRIBED EQUIPMENT IS IMPRACTICABLE BECAUSE DEFINITIVE DRAWINGS AND SPECIFICATIONS ARE NOT AVAILABLE. WERE THESE DATA AVAILABLE, IT WOULD STILL BE IMPRACTICABLE FOR ANY OTHER FIRM TO SET UP, TOOL, AND MANUFACTURE AN ITEM FOR THIS ONE-TIME PROCUREMENT.

DETERMINATION

"THE PROPOSED CONTRACT IS FOR PROPERTY OR SERVICES FOR WHICH IT IS IMPRACTICABLE TO OBTAIN COMPETITION BY FORMAL ADVERTISING."

PURSUANT TO THIS DETERMINATION AND FINDINGS, ON MAY 4, 1970, THE INSTANT SOLICITATION WAS ISSUED TO ACTON AS THE SOLE SOURCE. THE REQUIREMENT WAS ALSO SYNOPSIZED IN THE COMMERCE BUSINESS DAILY "SYNOPSIS OF U.S. GOVERNMENT PROPOSED PROCUREMENT, SALES AND CONTRACT AWARDS." THE SYNOPSIS STATED THAT THE SOLICITATION WAS BEING ISSUED ONLY TO ACTON, THAT THE NOTICE WAS FOR INFORMATIONAL PURPOSES ONLY, AND THAT COPIES OF THE SOLICITATION WERE NOT AVAILABLE. UPON READING THE SYNOPSIS, YOU REQUESTED AND WERE PROVIDED A COPY OF THE SOLICITATION AND YOU TIMELY SUBMITTED A PROPOSAL.

THE FOLLOWING PROPOSALS WERE RECORDED ON MAY 25, 1970, THE CLOSING DATE FOR RECEIPT OF PROPOSALS:

ACTON LABORATORIES, INC. $24,500.00

NOVATRONICS, INC. 23,380.00 YOU PLACED THE FOLLOWING "NOTE" ON THE SOLICITATION SCHEDULE:

"TO THE BEST OF OUR KNOWLEDGE ONLY TWO COMPANIES IN THE U.S.A. PRODUCE MULTIPLE FILTER SPECTRUM ANALYZERS OF THIS TYPE. OUR MODEL NUMBER, WHICH MEETS YOUR SPECIFICATION, IS 480-26WR. TWO COPIES OF OUR INSTRUCTION MANUAL ARE ENCLOSED."

YOUR PROPOSAL, INCLUDING THE INSTRUCTION MANUAL, WAS THEN EXAMINED BY THE CONTRACTING OFFICER'S TECHNICAL ADVISERS, WHO CONCLUDED:

"THE NOVATRONICS, INC. MODEL 480-26WR SPECTRUM ANALYZER/RECORDER IS NOT ACCEPTABLE FOR THE FOLLOWING REASONS:

"A. OPTION 1 REQUIRED ON THE ACTON MODEL SPECIFIED THAT THE RECORDER UNIT IS TO BE PLACED ON THE LEFT SIDE OF THE FREQUENCY ANALYZER UNIT. THE NOVATRONICS MODEL HAS THE RECORDER UNIT MOUNTED ABOVE THE FREQUENCY ANALYZER UNIT. THE RECORDER UNIT AND THE FREQUENCY ANALYZER UNIT MUST BE PHYSICALLY COUPLED TOGETHER FOR SYNCHRONIZATION.

"B. THE ACTON LABS MODEL REQUIRES 17-1/2 INCHES OF VERTICAL RACK SPACE; THE NOVATRONICS MODEL REQUIRES 36-3/4 INCHES PLUS THE RECORDER UNIT. THIS VERTICAL RACK SPACE REQUIREMENT AND THE LOCATION OF THE RECORDER UNIT IN RELATION TO THE FREQUENCY ANALYZER UNIT IS OF PRIME CONSIDERATION, SINCE THE ENTIRE ASSEMBLY WILL BE PLACED WITHIN AN INSTRUMENTATION VAN, WHERE SPACE IS AT A PREMIUM. THE INSTRUMENTATION VAN INTERIOR LIMITATIONS ESTABLISHED THE NEED FOR OPTION 1 OF THE ACTON MODEL 26-10.5K."

PAGES 1-2 AND 1-5 OF YOUR INSTRUCTION MANUAL DEPICT THE MODEL 480 26WR SPECTRUM ANALYZER AS CONTAINED IN A CABINET 47-3/8 INCHES HIGH, EXCLUSIVE OF THE RECORDER UNIT WHICH IS MOUNTED ON TOP OF THE CABINET. THE COMMUTATOR, ANALYZER ELECTRONICS, FREQUENCY MARKER, SPARE PARTS DRAWER AND MARKING AMPLIFIER TOTAL 40-1/4 INCHES IN HEIGHT. EVEN IF THE RECORDER UNIT WAS PLACED ADJACENT TO THE COMMUTATOR, AND THE SPARE PARTS DRAWER WAS DELETED, THE OTHER COMPONENTS WOULD BE 36-3/4 INCHES IN HEIGHT, COMPARED TO 17-1/2 INCHES FOR THE ACTON MODEL 26-10.5K. THE REDUCTION IN SIZE WHICH WOULD BE REQUIRED OF YOUR EQUIPMENT WAS NOT DEEMED TECHNICALLY FEASIBLE WITHIN THE REQUIRED DELIVERY SCHEDULE OF 45 DAYS. YOUR LETTER OF JULY 16, 1970, STATES THAT "THE HANDBOOK SUBMITTED WITH OUR PROPOSAL WAS TO INDICATE OUR CAPABILITIES TO MANUFACTURE SPECTRUM ANALYZERS AND TO OVERCOME THE SOLE SOURCE CLASSIFICATION." HOWEVER, WE MUST AGREE WITH THE PROCURING ACTIVITY THAT YOUR INSTRUCTION MANUAL FOR THE MODEL NO. 480-26WR DID NOT INDICATE ANY ALTERNATE CONFIGURATION FOR THE EQUIPMENT.

ADDITIONALLY, THE SOLICITATION ESTABLISHED A "DESIRED" DELIVERY SCHEDULE OF 30 DAYS AFTER DATE OF CONTRACT, AND A "REQUIRED" DELIVERY SCHEDULE OF 45 DAYS AFTER DATE OF CONTRACT. OFFERORS WERE PERMITTED TO PROPOSE ALTERNATE DELIVERY SCHEDULES SUBJECT TO THE FOLLOWING RESTRICTION:

"OFFERORS OFFERING DELIVERY OF A QUANTITY UNDER SUCH TERMS OR CONDITIONS THAT DELIVERY WILL NOT CLEARLY FALL WITHIN THE APPLICABLE REQUIRED DELIVERY PERIOD SPECIFIED ABOVE WILL BE CONSIDERED NONRESPONSIVE AND WILL BE REJECTED."

THE COPY OF YOUR PROPOSAL SUBMITTED WITH YOUR PROTEST SHOWS YOU PROPOSED A DELIVERY SCHEDULE OF "45 DAYS." HOWEVER, THE PROPOSAL WHICH YOU SUBMITTED TO THE PROCURING ACTIVITY PROPOSED A DELIVERY SCHEDULE OF "45 DAYS PLUS 17 DAYS FOR VACATION SHUTDOWN, DEPENDING UPON TIME OF AWARD."

BY LETTER OF JUNE 23, 1970, THE CONTRACTING OFFICER ADVISED YOU THAT YOUR PROPOSAL WAS UNACCEPTABLE. ON THE SAME DAY, THE CONTRACTING OFFICER AWARDED A CONTRACT TO ACTON IN THE AMOUNT OF $24,500. UPON RECEIPT OF THE LETTER OF JUNE 23, YOU PROTESTED TO THE CONTRACTING OFFICER AND THEN TO THIS OFFICE UPON THE DENIAL OF YOUR PROTEST BY THE CONTRACTING OFFICER.

UNDER 10 U.S.C. 2310(B) THE FINDINGS ISSUED BY THE CONTRACTING OFFICER AS A BASIS FOR CONCLUDING THAT THE PROCUREMENT OF THE SPECTRUM ANALYZER/RECORDER GROUP SHOULD BE NEGOTIATED WITH ACTON PURSUANT TO 10 U.S.C. 2304(A)(10) BECOME FINAL. ACCORDINGLY, OUR OFFICE IS WITHOUT AUTHORITY TO QUESTION SUCH FINDINGS UNLESS THEY ARE FRAUDULENT, ARBITRARY, CAPRICIOUS, GROSSLY ERRONEOUS OR NOT SUPPORTED BY SUBSTANTIAL EVIDENCE. IN VIEW THEREOF WE MUST CONCLUDE THAT THE RECORD, SHOWING THE LIMITATIONS IMPOSED BY THE INSTRUMENTATION VAN, IS ADEQUATE TO SUBSTANTIATE THE ARMY'S ACTION. WE THEREFORE SEE NO LEGAL BASIS FOR OBJECTION TO THE PROCUREMENT OF THE SYSTEMS FROM ACTON ON A SOLE-SOURCE BASIS.

WITH REGARD TO THE PROCURING ACTIVITY'S ALLEGED UNRESPONSIVENESS TO YOUR TELEPHONIC INQUIRIES CONCERNING THE PROCUREMENT, IT IS ADMINISTRATIVELY REPORTED THAT ALL GENERAL INFORMATION RELATING TO THE TERMS AND CONDITIONS OF THE SOLICITATION WERE FURNISHED TO YOU. HOWEVER, IT WAS NOT CONSIDERED PROPER TO PERMIT YOU TO DISCUSS YOUR PROPOSAL WITH THE ENGINEERING PERSONNEL ENGAGED IN THE EVALUATION OF YOUR PROPOSAL. FURTHER, THE PRESENT RECORD DOES NOT INDICATE THAT YOUR INQUIRIES COMPLIED WITH THE FOLLOWING REQUIREMENTS OF PARAGRAPH 3, STANDARD FORM 33A, WHICH FORMED A PART OF THE SOLICITATION:

"ANY EXPLANATION DESIRED BY AN OFFEROR REGARDING THE MEANING OR INTERPRETATION OF THE SOLICITATION, DRAWINGS, SPECIFICATIONS, ETC., MUST BE REQUESTED IN WRITING AND WITH SUFFICIENT TIME ALLOWED FOR A REPLY TO REACH OFFERORS BEFORE THE SUBMISSION OF THEIR OFFERS. *** "

YOU ALSO ALLEGE THAT A RECENT PROCUREMENT OF AN ACTON SPECTRUM ANALYZER BY PICATINNY ARSENAL FOR $21,250 ESTABLISHES THAT ACTON IS USING A "DUAL PRICE STRUCTURE" IN ITS GOVERNMENT SALES. IN THIS CONNECTION, THE CONTRACTING OFFICER WAS INFORMED BY PICATINNY ARSENAL THAT ITS PROCUREMENT WAS OF A DIFFERENT MODEL OF ACTON EQUIPMENT LACKING A RECORDER UNIT, WHICH WOULD APPEAR TO ACCOUNT FOR THE DIFFERENCE IN PRICE.

FOR THE FOREGOING REASONS, YOUR PROTEST MUST BE DENIED.