B-170855, DEC. 21, 1970

B-170855: Dec 21, 1970

Additional Materials:

Contact:

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

 

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

WHERE INSTABILITY IN DESIGN AND LACK OF DEVELOPED DATA MADE IT IMPRACTICAL TO HAVE A NEW SUBCONTRACTOR INTRODUCED. INC.: FURTHER REFERENCE IS MADE TO YOUR TELEFAX DATED SEPTEMBER 22. THE PURCHASE REQUEST UPON WHICH THE RFQ WAS BASED PROVIDED FOR THE ACQUISITION OF A6 AIRCRAFT TAILPIPES. PROCUREMENT WAS TO BE MADE ONLY FROM THE SOURCES KNOWN TO HAVE A COMPLETE DATA PACKAGE. WHICH HAD PREVIOUSLY AND IS CURRENTLY MANUFACTURING A6 TAILPIPES FOR GRUMMAN. A CONTRACT IS PROPOSED TO BE NEGOTIATED WITH LAVELLE AIRCRAFT CORPORATION BECAUSE OF THE IMPRACTICABILITY OF OBTAINING COMPETITION FOR THE GOVERNMENT'S REQUIREMENTS. THE SPARE PARTS BEING PROCURED WERE SPECIFICALLY DESIGNED BY GRUMMAN AND DATA IS PHYSICALLY NOT AVAILABLE TO ASSURE THAT PARTS OR COMPONENTS PROCURED FROM ANY OTHER SOURCES THAN THOSE NAMED ABOVE WILL PERFORM THE SAME FUNCTION IN THE EQUIPMENT AS THE PARTS OR COMPONENTS REPLACED THEREBY.

B-170855, DEC. 21, 1970

BID PROTEST - CAPACITY TO PERFORM DENIAL OF PROTEST OF LAWRENCE AVIATION INDUSTRIES, INC., AGAINST THE AWARD OF A NEGOTIATED CONTRACT FOR A6 AIRCRAFT TAILPIPES ISSUED BY THE NAVY AVIATION SUPPLY OFFICE TO ANY OTHER BIDDER. WHERE INSTABILITY IN DESIGN AND LACK OF DEVELOPED DATA MADE IT IMPRACTICAL TO HAVE A NEW SUBCONTRACTOR INTRODUCED, NO OBJECTION CAN BE MADE TO THE FINDING THAT COMPETITION WOULD BE IMPRACTICAL AND TO THE DECISION TO NEGOTIATE WITH LAVELLE AIRCRAFT CORPORATION.

TO LAWRENCE AVIATION INDUSTRIES, INC.:

FURTHER REFERENCE IS MADE TO YOUR TELEFAX DATED SEPTEMBER 22, 1970, AND YOUR LETTERS OF SEPTEMBER 30 AND NOVEMBER 13, 1970, PROTESTING THE AWARD OF A CONTRACT TO ANY OTHER FIRM UNDER REQUEST FOR QUOTATIONS (RFQ) NO. N00383-70-Q-0663, ISSUED BY THE NAVY AVIATION SUPPLY OFFICE (ASO), PHILADELPHIA, PENNSYLVANIA.

THE PURCHASE REQUEST UPON WHICH THE RFQ WAS BASED PROVIDED FOR THE ACQUISITION OF A6 AIRCRAFT TAILPIPES, CITING GRUMMAN AIRCRAFT ENGINEERING CORPORATION DRAWINGS. PROCUREMENT WAS TO BE MADE ONLY FROM THE SOURCES KNOWN TO HAVE A COMPLETE DATA PACKAGE, I.E., GRUMMAN, THE DESIGNER OF THE TAILPIPES, AND LAVELLE AIRCRAFT CORPORATION, WHICH HAD PREVIOUSLY AND IS CURRENTLY MANUFACTURING A6 TAILPIPES FOR GRUMMAN.

PURSUANT TO THE AUTHORITY OF 10 U.S.C. 2304(A)(10) AND BASED UPON THE CONTRACTING OFFICER'S "DETERMINATION AND FINDINGS" (D&F) MADE PURSUANT TO 10 U.S.C. 2310, A CONTRACT IS PROPOSED TO BE NEGOTIATED WITH LAVELLE AIRCRAFT CORPORATION BECAUSE OF THE IMPRACTICABILITY OF OBTAINING COMPETITION FOR THE GOVERNMENT'S REQUIREMENTS. THE CONTRACTING OFFICER'S D&F SETS FORTH THE FOLLOWING FACTS AND CIRCUMSTANCES:

"FACTS

"1. THE PROPOSED CONTRACT WITH GRUMMAN AIRCRAFT ENGINEERING CORPORATION OR LAVELLE AIRCRAFT CORPORATION PROVIDES FOR THE FURNISHING OF 110 R/H TAILPIPE ASSEMBLIES, GRUMMAN P/N 128P10230-18 AND 160 L/H TAILPIPE ASSEMBLIES, GRUMMAN P/N 12810230-17, USED ON THE A-6 AIRCRAFT.

"2. THE SPARE PARTS BEING PROCURED WERE SPECIFICALLY DESIGNED BY GRUMMAN AND DATA IS PHYSICALLY NOT AVAILABLE TO ASSURE THAT PARTS OR COMPONENTS PROCURED FROM ANY OTHER SOURCES THAN THOSE NAMED ABOVE WILL PERFORM THE SAME FUNCTION IN THE EQUIPMENT AS THE PARTS OR COMPONENTS REPLACED THEREBY.

"DETERMINATION

"THE USE OF A NEGOTIATED CONTRACT, WITHOUT FORMAL ADVERTISING, IS JUSTIFIED BECAUSE IT IS IMPRACTICABLE TO SECURE ADDITIONAL COMPETITION FOR THE SUPPLIES TO BE OBTAINED THEREUNDER. THE DATA IS PHYSICALLY NOT AVAILABLE TO ASSURE THAT THE SUPPLIES FURNISHED BY ANY SOURCE OTHER THAN THE ABOVE NAMED SOURCES WILL PERFORM THE SAME FUNCTION IN THE EQUIPMENT AS THE PARTS OR COMPONENTS THEY REPLACE."

PURSUANT TO THE ABOVE, THE REQUEST WAS FORWARDED TO GRUMMAN AND LAVELLE AIRCRAFT. IN ADDITION, HOWEVER, AN RFQ WAS ALSO SENT TO TWO OTHER FIRMS WHICH THE CONTRACTING OFFICER KNEW TO BE RESPONSIBLE SUPPLIERS OF AIRCRAFT TAILPIPES, YOUR FIRM AND WILPAC MANUFACTURING COMPANY, EL CAJON, CALIFORNIA.

AFTER ISSUANCE OF THE RFQ, THE CONTRACTING OFFICER BECAME AWARE OF A CHANGE IN THE GRUMMAN DRAWING NUMBERS AND, ON MARCH 2, 1970, ISSUED SUPPLEMENT MODIFICATION 0001 TO THE RFQ.

ON MARCH 30, 1970, THE CONTRACTING OFFICER RECEIVED QUOTATIONS FROM YOUR FIRM AND LAVELLE AIRCRAFT. DISCUSSIONS WERE HAD WITH EACH AND "BEST AND FINAL" QUOTATIONS WERE RECEIVED ON APRIL 6, 1970.

PRIOR TO THIS, THE CONTRACTING OFFICER HAD REFERRED AN INQUIRY TO THE ASO TECHNICAL DIVISION CONCERNING THE ACCEPTABILITY OF YOUR FIRM AS A NEW SOURCE FOR THE TAILPIPES. A REPLY WAS RECEIVED ON APRIL 8, 1970, ADVISING THAT YOUR FIRM COULD NOT BE CONSIDERED AN ACCEPTABLE SOURCE OF SUPPLY FOR THE REQUIRED TAILPIPES BECAUSE, IN ADDITION TO THE PHYSICAL UNAVAILABILITY OF DATE, THE INSTABILITY OF THE DESIGN OF THE TAILPIPES PREVENTED THE INTRODUCTION OF A NEW SOURCE OF SUPPLY. THE CONTRACTING OFFICER WAS ADVISED THAT THE A6 TAILPIPE ASSEMBLIES HAD BEEN CHANGED IN DESIGN TWICE IN THE PRECEDING 9 MONTHS, AND THAT ANOTHER CHANGE WAS CONTEMPLATED BY GRUMMAN IN THE NEAR FUTURE WHICH, IF APPROVED, WOULD CAUSE THE REDESIGN OF THE COMPLETE TAILPIPE AND AFT FUSELAGE OF THE AIRCRAFT.

FURTHER CORRESPONDENCE WAS RECEIVED AND TELEPHONE DISCUSSIONS AND MEETINGS WERE HELD IN WHICH YOUR FIRM DEMONSTRATED ITS ABILITY TO FURNISH THE REQUIRED TAILPIPES. YOUR FIRM TOOK THE POSITION THAT IT HAD ALL THE NECESSARY DATA TO MANUFACTURE THE TAILPIPES, THE FACILITIES AND ABILITY TO DO SO, AND REQUESTED ASO TO SEND AN ENGINEER TO VERIFY THESE STATEMENTS.

IN VIEW OF THE FOREGOING, ASO TECHNICAL PERSONNEL WERE AGAIN REQUESTED TO ADVISE IF THERE WAS ANY WAY YOUR FIRM COULD BE CONSIDERED AS AN ACCEPTABLE SOURCE OF SUPPLY. AS A RESULT OF SUCH INQUIRY, YOUR FIRM WAS REQUESTED TO SUBMIT ITS DATA PACKAGE.

WHILE YOUR FIRM WOULD NOT GIVE ASO COPIES OF YOUR MANUFACTURING DATA, IT DID FURNISH TO ASO A LIST OF ALL DRAWINGS, BOTH ASSEMBLY AND DETAIL DRAWINGS. TECHNICAL PERSONNEL WERE THEN SENT TO THE GRUMMAN PLANT (AS WELL AS TO YOUR PLANT AND LAVELLE). AFTER THE REVIEW OF THE GRUMMAN DATA, ASO DETERMINED THAT YOUR FIRM DID NOT HAVE A FULL DATA PACKAGE, ALTHOUGH IT STILL MAINTAINS THAT ITS DATA IS COMPLETE AND UP-TO-DATE. FURTHERMORE, GRUMMAN INDICATED THAT THE TAILPIPES WERE UNSTABLE IN DESIGN AND THAT FURTHER DEVELOPMENT OF THE TAILPIPES WAS IN PROCESS.

IN LIGHT OF THESE FACTS, ASO DETERMINED THAT THE INSTABILITY IN DESIGN MADE IT IMPRACTICAL, BOTH FOR GRUMMAN AND THE GOVERNMENT, TO HAVE A NEW SUBCONTRACTOR INTRODUCED AT THIS TIME. THE ADMINISTRATIVE REPORT FURNISHED TO OUR OFFICE CONCLUDED:

" *** A CLOSE WORKING RELATIONSHIP, WHICH IS NECESSARY TO THE REDESIGN AND MANUFACTURE OF A SATISFACTORY TAILPIPE, HAS BEEN ESTABLISHED BETWEEN GRUMMAN AND LAVELLE AND, UNTIL THE DESIGN IS STABILIZED AND DATA DEVELOPED FOR THE APPROVED DESIGN, IT IS IMPRACTICAL TO ATTEMPT TO ESTABLISH THE RELATIONSHIP AND 'KNOW-HOW' AT LAWRENCE. A PROVISION FOR THE SUBMISSION OF A FIRST ARTICLE WOULD NOT MAKE PROCUREMENT FROM A SOURCE OTHER THAN GRUMMAN OR LAVELLE ANY LESS IMPRACTICAL. THE TAILPIPE IS A SENSITIVE AND VITALLY IMPORTANT PART OF THE AIRCRAFT; ITS PRECISE OPERATION IS ESSENTIAL TO THE SAFE OPERATION OF THE AIRCRAFT."

OUR OFFICE HAS HELD THAT A DETERMINATION OF THE GOVERNMENT'S NEEDS IS THE RESPONSIBILITY OF THE AGENCY INVOLVED. 40 COMP. GEN. 35 (1960), 17 COMP. GEN. 554 (1938). MOREOVER, WHERE THE AUTHORITY TO NEGOTIATE APPLIES AND IS USED, THE CONTRACTING AGENCY IS PERMITTED A BROAD RANGE OF DISCRETION AND LEGALLY MAY TAKE INTO CONSIDERATION ALL FACTORS AFFECTING THE NEEDS AND INTERESTS OF THE GOVERNMENT. THESE RULES ARE PARTICULARLY PERTINENT WHERE THE PROCUREMENT IS FOR EQUIPMENT OF A SPECIALIZED NATURE AND THE DETERMINATION MUST BE BASED ON EXPERT TECHNICAL OPINION. 46 COMP. GEN. 606 (1967).

WE THEREFORE FIND NO LEGAL BASIS UPON WHICH WE MAY OBJECT TO THE PROPOSED AWARD OF THE CONTRACT TO LAVELLE AIRCRAFT CORPORATION, AND ACCORDINGLY, YOUR PROTEST IS DENIED.

HOWEVER, WE NOTE THAT THE PROCUREMENT ACTIVITY ANTICIPATES THAT A FULL DATA PACKAGE WILL BE OBTAINED AND THAT FUTURE REQUIREMENTS WILL BE COMPETITIVELY SOLICITED.