B-170622(1), OCT. 7, 1970

B-170622(1): Oct 7, 1970

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INCORPORATED: REFERENCE IS MADE TO YOUR LETTER OF AUGUST 11. THE PROCUREMENT UNDER ITEM NO. 1 WAS FOR A QUANTITY OF 60. WAS THE SCHEDULED DATE FOR RECEIPT OF OFFERS. THE PROCUREMENT WAS NEGOTIATED PURSUANT TO THE AUTHORITY IN 10 U.S.C. 2304 (A)(2). WHICH PROVIDES FOR AN EXCEPTION TO THE FORMAL ADVERTISING REQUIREMENT WHERE THE PUBLIC EXIGENCY WILL NOT PERMIT THE DELAY INCIDENT TO ADVERTISING. WHICH MADE CERTAIN CHANGES IN THE SPECIFICATIONS AND THE DATE FOR THE RECEIPT OF OFFERS WAS EXTENDED TO JUNE 25. OFFERS WERE SOLICITED FROM THREE CURRENT PRODUCERS. THE FOLLOWING OFFERS WERE RECEIVED ON JUNE 25: "OFFEROR UNIT PRICE (FOB ORIGIN) TOTAL AMOUNT NORTHROP $42.27 $2. YOUR OFFER CERTIFIED THAT YOU WERE NOT A SMALL BUSINESS CONCERN.

B-170622(1), OCT. 7, 1970

BID PROTEST - DEVIATIONS - DELIVERY SCHEDULE DENIAL OF PROTEST AGAINST REJECTION OF LOW OFFER FOR FURNISHING FLARE PARACHUTES FOR NAVY SHIPS PARTS CONTROL CENTER AND AWARD TO BERMITE. ADMINISTRATIVE DETERMINATION THAT PROTESTANT'S LOW OFFER DEVIATED FROM DELIVERY SCHEDULE SPECIFIED AND THAT IN VIEW OF REQUIREMENTS UNDER CURRENT CONTRACT THAT PROTESTANT WOULD NOT BE ABLE TO MEET DELIVERY SCHEDULE DOES NOT AFFORD BASIS FOR OBJECTION.

TO NORTHROP CAROLINA, INCORPORATED:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 11, 1970, PROTESTING AGAINST THE AWARD OF A CONTRACT TO ANOTHER CONCERN UNDER REQUEST FOR PROPOSALS (RFP) NO. N00104-70-R-Z 535(21.5), ISSUED ON JUNE 11, 1970, BY THE NAVY SHIPS PARTS CONTROL CENTER, MECHANICSBURG, PENNSYLVANIA. THE PROCUREMENT UNDER ITEM NO. 1 WAS FOR A QUANTITY OF 60,000 MK 24, FLARE PARACHUTES IN ACCORDANCE WITH APPLICABLE SPECIFICATIONS. JUNE 22, 1970, WAS THE SCHEDULED DATE FOR RECEIPT OF OFFERS.

THE PROCUREMENT WAS NEGOTIATED PURSUANT TO THE AUTHORITY IN 10 U.S.C. 2304 (A)(2), WHICH PROVIDES FOR AN EXCEPTION TO THE FORMAL ADVERTISING REQUIREMENT WHERE THE PUBLIC EXIGENCY WILL NOT PERMIT THE DELAY INCIDENT TO ADVERTISING. ON JUNE 17, 1970, THE PROCURING ACTIVITY ISSUED AMENDMENT NO. 000001, WHICH MADE CERTAIN CHANGES IN THE SPECIFICATIONS AND THE DATE FOR THE RECEIPT OF OFFERS WAS EXTENDED TO JUNE 25, 1970. OFFERS WERE SOLICITED FROM THREE CURRENT PRODUCERS, KILGORE CORPORATION, NORTHROP CAROLINA, INCORPORATED (NORTHROP) AND BERMITE DIVISION OF TASKER INDUSTRIES (BERMITE). THE FOLLOWING OFFERS WERE RECEIVED ON JUNE 25:

"OFFEROR UNIT PRICE (FOB ORIGIN) TOTAL AMOUNT

NORTHROP $42.27 $2,536,200.00

BERMITE (INITIAL) $44.40 $2,664,000.00" KILGORE CORPORATION DECLINED TO SUBMIT AN OFFER. YOUR OFFER CERTIFIED THAT YOU WERE NOT A SMALL BUSINESS CONCERN.

THE REQUIRED DELIVERY SCHEDULE SET FORTH ON PAGE 8 OF THE RFP WAS 33,000 UNITS BY OCTOBER 30, 1970, AND 27,000 UNITS BY NOVEMBER 30, 1970. NEXT TO THE GOVERNMENT'S REQUIRED DELIVERY SCHEDULE, OFFERORS WERE TO INSERT THEIR PROPOSED DELIVERY SCHEDULE AND YOU INSERTED AS FOLLOWS:

"20,000 EA. 30 NOV. 1970

20,000 EA. 30 DEC. 1970

20,000 EA. 30 JAN. 1971" THE DELIVERY SCHEDULE SUBMITTED BY THE OTHER OFFEROR WAS IN ACCORDANCE WITH THE REQUIREMENTS SET FORTH IN THE RFP.

THE PROVISION RELATING TO "TIME OF DELIVERY" ON PAGE 8 OF THE SOLICITATION, PARAGRAPH 6.73 STATED AS FOLLOWS:

"DELIVERY IS REQUIRED TO BE MADE IN ACCORDANCE WITH THE SCHEDULE INDICATED BELOW. OFFERS OFFERING DELIVERY OF EACH QUANTITY WITHIN THE APPLICABLE DELIVERY PERIOD SPECIFIED BELOW WILL BE EVALUATED EQUALLY AS REGARDS TIME OF DELIVERY. OFFERS OFFERING DELIVERY OF A QUANTITY UNDER SUCH TERMS OR CONDITIONS THAT DELIVERY WILL NOT CLEARLY FALL WITHIN THE APPLICABLE DELIVERY PERIOD SPECIFIED BELOW WILL BE CONSIDERED NONRESPONSIVE AND WILL BE REJECTED.

"WHERE AN OFFEROR OFFERS AN EARLIER DELIVERY SCHEDULE THAN THAT CALLED FOR BELOW, THE GOVERNMENT RESERVES THE RIGHT TO AWARD EITHER IN ACCORDANCE WITH THE REQUIRED SCHEDULE OR IN ACCORDANCE WITH THE SCHEDULE OFFERED BY THE OFFEROR. IF THE OFFEROR OFFERS NO OTHER DELIVERY SCHEDULE, THE DELIVERY SCHEDULE STATED BELOW SHALL APPLY.

"THE DELIVERY REQUIREMENTS ARE BASED ON THE ASSUMPTION THAT THE GOVERNMENT WILL MAKE AWARD BY 1970 JUL 03. EACH DELIVERY DATE IN THE DELIVERY SCHEDULE SET FORTH HEREIN WILL BE EXTENDED BY THE NUMBER OF CALENDAR DAYS AFTER THE ABOVE DATE THAT THE CONTRACT IS IN FACT AWARDED. ATTENTION IS DIRECTED TO PARAGRAPH 10(D) OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS, WHICH PROVIDES THAT A WRITTEN AWARD MAILED OR OTHERWISE FURNISHED TO THE SUCCESSFUL OFFEROR RESULTS IN A BINDING CONTRACT. THEREFORE, IN COMPUTING THE AVAILABLE TIME FOR PERFORMANCE, THE OFFEROR SHOULD TAKE INTO CONSIDERATION THE TIME REQUIRED FOR NOTICE OF AWARD TO ARRIVE THROUGH THE ORDINARY MAILS. 1-305.3(B)(I) (1967 AUG)."

IN VIEW OF YOUR DEVIATION FROM THE REQUIRED DELIVERY SCHEDULE, THE PROCURING ACTIVITY REJECTED YOUR OFFER WITHOUT FURTHER DISCUSSION. WE ARE ADVISED THAT THE PROPOSAL FROM BERMITE INCLUDED AN UNSOLICITED CONTRACT PRICING PROPOSAL, DD FORM 633. IN DISCUSSIONS WITH BERMITE ON THE COST BREAKDOWN, THIS CONCERN OFFERED A VOLUNTARY PRICE REDUCTION OF $0.40 EACH OR A UNIT PRICE OF $44.00. BERMITE'S REVISED OFFER WAS EVALUATED AS FOLLOWS:

OFFER $44.00 $2,640,000

GOVERNMENT'S

FREIGHT COSTS .804 48,240

$44.804 $2,688,240

IN THE LETTER OF PROTEST OF AUGUST 11, YOU MAKE THE FOLLOWING CONTENTIONS:

"1. THE GOVERNMENT WILL PAY $103,800 MORE FOR THE MATERIALS.

"2. WITH FREIGHT ADJUSTMENT CONSIDERED BETWEEN THE LOCATION OF THE COMPETITORS AND THE DELIVERY POINT THE GOVERNMENT WILL STILL PAY APPROXIMATELY $43,000 MORE FOR THE MK 24 FLARES DELIVERED.

"3. THE PROCUREMENT WAS NOT HANDLED AS URGENT OR IN ACCORDANCE WITH THE RFP ASSUMED AWARD DATE RESULTING IN 5 WEEKS ADMINISTRATIVE DELAY.

"4. NCI WAS NOT NOTIFIED THAT OUR PROPOSAL WAS NON-RESPONSIVE OR UNACCEPTABLE BECAUSE OF DELIVERY OR ANY OTHER REASONS.

"5. DUE TO THE DELAY IN AWARD OF 5 WEEKS BY SPCC THE SCHEDULE DISADVANTAGE OF NCI HAS CHANGED *** "

THE NAVY HAS ADVISED OUR OFFICE THAT YOU HAVE A CURRENT CONTRACT FOR PRODUCING FLARE PARACHUTES AND THAT CONSIDERING YOUR OBLIGATIONS UNDER YOUR CURRENT CONTRACT, YOU WOULD NOT HAVE THE CAPACITY TO MEET THE DELIVERY REQUIREMENTS OF THE INSTANT PROCUREMENT. THE FOLLOWING IS AN EXCERPT FROM NAVY'S REPORT CONCERNING YOUR ABILITY TO MEET THE DELIVERY SCHEDULE OF THIS PROCUREMENT:

"7. NO DISCUSSIONS WERE HELD BETWEEN SPCC AND NORTHROP CAROLINA PERSONNEL CONCERNING THE SUBMISSION OF AN ALTERNATE DELIVERY SCHEDULE WHICH WOULD NOT CONFLICT WITH THEIR CURRENT CONTRACT DELIVERIES. ANALYSIS OF NORTHROP'S DELIVERY UNDER THEIR CURRENT CONTRACT AND THE DELIVERIES PROPOSED UNDER THE REQUEST FOR PROPOSAL WAS AS FOLLOWS:

"REQUIRED CURRENT CONTRACT REQUEST FOR TOTAL

DELIVERY N0010470CA069 (72,332 UNITS) PROPOSAL QUANTITY

OCTOBER 1970 12,833 EACH - 12,833 EACH

NOVEMBER 1970 17,833 EACH20,000 37,833 EACH

DECEMBER 1970 20,833 EACH 20,000 40,833 EACH

JANUARY 1971 20,833 EACH 20,000 40,833 EACH "AT THE TIME THE CURRENT CONTRACT WAS AWARDED, NORTHROP CAROLINA HAD BEEN OUT OF FLARE PRODUCTION FOR MORE THAN A YEAR. AS A RESULT, DCASR ATLANTA WITH NAD CRANE PARTICIPATING, WAS REQUESTED TO PERFORM A PRE AWARD SURVEY. THE SURVEY REVEALED THAT THE CURRENT CONTRACT SCHEDULE REPRESENTED NORTHROP'S MAXIMUM PRODUCTION CAPACITY, BASED ON THE LONG LEAD TIME REQUIRED FOR MANY OF THE VITAL FLARE COMPONENTS AND THE 10 TO 12 WEEKS REQUIRED TO RENDER TOOLING, EQUIPMENT AND FACILITIES OPERATIONAL. NORTHROP'S CURRENT CONTRACT RESULTED FROM A STEP-LADDER REQUEST FOR PROPOSAL, WITH STEPS RANGING FROM 72,332 UNITS TO 165,780 UNITS. NORTHROP SUBMITTED THE LOW OFFER UNDER EACH STEP, BUT WAS ONLY CAPABLE OF PRODUCING THE SMALLEST QUANTITY IN ACCORDANCE WITH THE PRE AWARD SURVEY, WHICH ESTABLISHED A MAXIMUM MONTHLY QUANTITY OF 20,833 UNITS. *** " WHILE THE ABOVE ANALYSIS IS BASED ON THE INITIAL DELIVERY SCHEDULE SET FORTH IN YOUR OFFER, THE MAXIMUM MONTHLY CAPACITY FOR YOUR CONCERN ESTABLISHED BY THE PRE-AWARD SURVEY WOULD STILL HAVE BEEN EXCEEDED FOR DECEMBER 1970 AND JANUARY 1971 IF THE REQUIREMENTS UNDER YOUR ADJUSTED DELIVERY SCHEDULE WERE ADDED TO YOUR OBLIGATIONS UNDER YOUR CURRENT CONTRACT.

THE SITUATION PRESENTED TO US IS ONE WHERE THE PROCURING ACTIVITY DID NOT NEGOTIATE WITH YOUR CONCERN, THE LOW OFFEROR, SINCE IT WAS DETERMINED THAT YOUR OFFER DEVIATED FROM THE REQUIRED DELIVERY SCHEDULE SPECIFIED IN THE RFP AND THAT IN VIEW OF THE REQUIREMENTS UNDER YOUR CURRENT CONTRACT WITH THE NAVY YOU WOULD NOT BE ABLE TO MEET THE REQUIRED DELIVERY SCHEDULE.

THE CRITERIA SET FORTH IN PARAGRAPH 6.73, QUOTED ABOVE, THAT IS, THAT EACH DELIVERY DATE SET FORTH IN THE SOLICITATION WOULD BE EXTENDED BY THE NUMBER OF DAYS AFTER JULY 3, 1970, THAT THE CONTRACT WAS IN FACT AWARDED, WAS USED IN EVALUATING PROPOSALS. APPROVAL TO AWARD A CONTRACT TO BERMITE WAS GRANTED ON AUGUST 3, 1970. IN ACCORDANCE WITH THE TERMS OF THE SOLICITATION, THE REQUIRED DELIVERY SCHEDULE IN THE RFP WAS ADJUSTED AS FOLLOWS:

33,000 EACH BY NOVEMBER 30, 1970

27,000 EACH BY DECEMBER 30, 1970 THE SCHEDULE OFFERED IN YOUR PROPOSAL, AS ADJUSTED, WAS AS FOLLOWS:

20,000 EACH BY DECEMBER 30, 1970

20,000 EACH BY JANUARY 30, 1971

20,000 EACH BY MARCH 2, 1971

WE HAVE STATED THAT THE AUTHORITY GRANTED BY 10 U.S.C. 2304(A)(2), TO NEGOTIATE A PROCUREMENT BECAUSE OF THE CRITICAL IMPORTANCE OF EARLY DELIVERY CONTEMPLATES THE POSSIBILITY OF AN AWARD TO AN OFFEROR WHO OFFERS THE BEST DELIVERY SCHEDULE, EVEN IF HE HAS NOT OFFERED THE BEST PRICE. SEE 46 COMP. GEN. 22 (1966) AND B-165871, MARCH 13, 1969. THE FACT THAT DISCUSSIONS WERE HELD WITH BERMITE BUT NOT WITH YOUR CONCERN WOULD NOT AFFECT THE VALIDITY OF THE AWARD IN THIS CASE, SINCE THE RECORD SHOWED THAT IN VIEW OF THE COMMITMENTS UNDER YOUR PRESENT CONTRACT WITH THE NAVY YOU WOULD NOT BE ABLE TO MEET THE REQUIRED DELIVERY SCHEDULE. THE DELIVERY SCHEDULE IN THE RFP, AS WELL AS THE DELIVERY SCHEDULE OFFERED IN YOUR PROPOSAL, WERE ADJUSTED FOR THE TIME IT TOOK TO ADMINISTRATIVELY PROCESS THE AWARD. THESE ADJUSTMENTS WERE IN ACCORDANCE WITH THE CRITERIA SET FORTH IN THE RFP AND SEEM TO HAVE BEEN NECESSARY TO EVALUATE WHAT WAS BEING OFFERED IN TERMS OF DELIVERY. WHILE IT MAY HAVE TAKEN SEVERAL WEEKS TO PROCESS THE AWARD, WE CANNOT SAY THAT THIS PERIOD WAS SO UNREASONABLY LONG AS TO IMPLY THAT THE ITEMS WERE IN FACT NOT URGENTLY REQUIRED. ANY EVENT THE DETERMINATION TO NEGOTIATE A PROCUREMENT UNDER THE PUBLIC URGENCY EXCEPTION TO THE ADVERTISING REQUIREMENTS IS MADE FINAL BY 10 U.S.C. 2310(B). SEE 45 COMP. GEN. 374 (1966) AND B-162736, AUGUST 16, 1968.

WE HAVE BEEN INFORMED BY NAVY THAT YOUR CONCERN RECEIVED TELEPHONIC NOTIFICATION ON AUGUST 10, 1970, THAT THE AWARD WOULD BE MADE TO BERMITE. EVEN IF YOU WERE NOT GIVEN PRE-AWARD NOTICE THAT YOUR PROPOSAL WAS NOT ACCEPTABLE, THIS WOULD NOT CONSTITUTE A BISIS FOR QUESTIONING THE AWARD IN THE CIRCUMSTANCES OF THIS CASE.

FOR THESE REASONS YOUR PROTEST IS DENIED.