B-171015(1), JUL 13, 1971

B-171015(1): Jul 13, 1971

Additional Materials:

Contact:

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

 

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

THE PROPOSAL SHOULD HAVE INDICATED THE RELATIVE IMPORTANCE OF THE EVALUATION CRITERIA USED AND CORRECTIVE ACTION HAS BEEN RECOMMENDED TO THE SECRETARY OF THE NAVY. AS THE FAILURE TO NEGOTIATE WAS PROMPTED BY AN EFFORT TO PREVENT USE OF THE AUCTION TECHNIQUE AFTER PRICES WERE INADVERTENTLY DISCLOSED. WE AGREE WITH YOUR CONTENTION THAT AS A MATTER OF SOUND PROCUREMENT POLICY THE REQUEST FOR PROPOSALS SHOULD HAVE INDICATED THE RELATIVE IMPORTANCE OF THE EVALUATION CRITERIA USED. 50 COMP. WE ARE DRAWING THIS DEFECT TO THE ATTENTION OF THE SECRETARY OF THE NAVY FOR APPROPRIATE ACTION. ONLY TWO PROPOSALS WERE RECEIVED BY THE SEPTEMBER 15. THROUGH INADVERTENCE BOTH PROPOSALS WERE OPENED AND THE PRICES OFFERED DISCLOSED: BURNS AND ROE OFFERED A PRICE OF $3.

B-171015(1), JUL 13, 1971

BID PROTEST - NEGOTIATE PROCUREMENT - FAILURE TO NEGOTIATE DECISION DENYING PROTEST OF PREMIER ELECTRICAL CONSTRUCTION COMPANY AGAINST AWARD OF CONTRACT TO BURNS & ROE CONSTRUCTION CORPORATION FOR CONSTRUCTION OF 150 HOUSING UNITS AT GUANTANAMO NAVAL BASE, UNDER RFP ISSUED BY NAVAL FACILITIES ENGINEER COMMAND. AS PROTESTANT CONTENDS, THE PROPOSAL SHOULD HAVE INDICATED THE RELATIVE IMPORTANCE OF THE EVALUATION CRITERIA USED AND CORRECTIVE ACTION HAS BEEN RECOMMENDED TO THE SECRETARY OF THE NAVY. HOWEVER, THIS NOR THE FAILURE OF THE PROCURING AGENCY TO CARRY OUT NEGOTIATIONS WITH THE PARTIES INVALIDATES THE PROCUREMENT, AS THE FAILURE TO NEGOTIATE WAS PROMPTED BY AN EFFORT TO PREVENT USE OF THE AUCTION TECHNIQUE AFTER PRICES WERE INADVERTENTLY DISCLOSED.

TO MR. A. DENISON WEAVER:

WE REFER TO YOUR LETTER OF MARCH 18, 1971, AND PRIOR CORRESPONDENCE, PROTESTING ON BEHALF OF PREMIER ELECTRICAL CONSTRUCTION COMPANY AGAINST THE NAVAL FACILITIES ENGINEERING COMMAND'S AWARD OF A CONTRACT ON NOVEMBER 13, 1970, TO BURNS AND ROE CONSTRUCTION CORPORATION FOR THE DESIGN AND CONSTRUCTION (TURNKEY METHOD) OF 150 UNITS OF FAMILY HOUSING AT GUANTANAMO NAVAL BASE.

OF THE ISSUES RAISED IN PREMIER'S INITIAL PROTEST LETTER OF OCTOBER 14, 1970, AND SUBSEQUENT CORRESPONDENCE, TWO CONTENTIONS REMAIN IN YOUR LETTER OF MARCH 18, 1971, RESPONDING TO THE ADMINISTRATIVE REPORT FURNISHED OUR OFFICE BY THE COUNSEL, NAVAL FACILITIES ENGINEERING COMMAND, WASHINGTON, D.C. (NAVFAC).

FIRST, WE AGREE WITH YOUR CONTENTION THAT AS A MATTER OF SOUND PROCUREMENT POLICY THE REQUEST FOR PROPOSALS SHOULD HAVE INDICATED THE RELATIVE IMPORTANCE OF THE EVALUATION CRITERIA USED. 50 COMP. GEN. 59 (1970) AND CASES CITED THEREIN. WE ARE DRAWING THIS DEFECT TO THE ATTENTION OF THE SECRETARY OF THE NAVY FOR APPROPRIATE ACTION.

SECOND, YOU URGE THAT THE CONTRACTING AGENCY FAILED TO ENTER INTO MEANINGFUL NEGOTIATIONS WITH PREMIER AS REQUIRED BY 10 U.S.C. 2304(G). ONLY TWO PROPOSALS WERE RECEIVED BY THE SEPTEMBER 15, 1970, DATE SPECIFIED FOR RECEIPT OF PROPOSALS. THROUGH INADVERTENCE BOTH PROPOSALS WERE OPENED AND THE PRICES OFFERED DISCLOSED: BURNS AND ROE OFFERED A PRICE OF $3,580,330 FOR THE WORK; PREMIER SUBMITTED A PRICE OF $4,066,000. UPON EVALUATION, IT WAS DETERMINED THAT THE BURNS AND ROE PROPOSAL WAS MOST ADVANTAGEOUS FROM BOTH A DESIGN AND COST STANDPOINT. FURTHER, IN VIEW OF THE INADVERTENT DISCLOSURE OF PRICES, NAVFAC, WASHINGTON, DIRECTED ITS ATLANTIC DIVISION TO CONDUCT NEGOTIATIONS ONLY IF ABSOLUTELY NECESSARY AND THEN ONLY WITH ITS APPROVAL IN ORDER TO AVOID AN AUCTION TECHNIQUE. APART FROM CONFIRMING THAT PREMIER'S PROPOSAL MET FEDERAL HOUSING ADMINISTRATION STANDARDS, BOTH PREMIER AND BURNS AND ROE WERE ADVISED THAT THE SOLICITATION PROVISIONS WITH RESPECT TO THE USE OF FOREIGN FLAG VESSELS WERE AMBIGUOUS. IN THIS REGARD, WE HAVE RECEIVED A MEMORANDUM DATED JUNE 4, 1971, FROM THE HEAD, CONTRACT PROCEDURES BRANCH, NAVFAC, WHICH STATES IN PERTINENT PART THAT:

" *** NO DISCUSSIONS WERE HELD WITH EITHER PROPOSER WITH THE FOLLOWING EXCEPTION. THE REQUEST FOR PROPOSALS INCLUDED A PROVISION WHICH APPEARED TO INDICATE THAT SHIPMENT BY FOREIGN FLAG VESSELS WAS PERMISSIBLE. SUCH A PROVISION IS IN CONFLICT WITH APPLICABLE REGULATIONS. EACH PROPOSER WAS CONTACTED WITH REGARD TO THIS POINT, ADVISED THAT SHIPMENT WOULD BE PERMITTED ONLY PURSUANT TO THE STANDARD U.S. FLAG AND RELATED SHIPPING PROVISIONS (SEE ASPR 1-1409), AND AFFORDED AN OPPORTUNITY TO REVISE HIS COST. AS A RESULT, BURNS & ROE INCREASED THEIR PRICE BY $90,000. PREMIER INDICATED THERE WOULD BE NO CHANGE."

AWARD WAS THEREAFTER MADE TO BURNS AND ROE IN AN AMOUNT OF $3,728,330. THIS SUM INCLUDED THREE SEPARATELY PRICED OPTIONS INCLUDED IN THE BURNS AND ROE PROPOSAL:PRIVACY FENCING AT $19,500; PLAYGROUND AT $19,800; AND UNDERGROUND WIRING AT $18,700.

IN VIEW OF THE FOREGOING CIRCUMSTANCES, WE ARE NOT DISPOSED TO QUESTION THE AWARD TO BURNS AND ROE. WHILE IT MAY BE OBSERVED THAT FURTHER NEGOTIATIONS SHOULD HAVE BEEN UNDERTAKEN, WE CANNOT SAY THAT NAVFAC WAS PATENTLY UNJUSTIFIED IN MAKING EVERY EFFORT TO AVOID A PROHIBITED AUCTION TECHNIQUE. AS REQUESTED, WE ARE ENCLOSING A COPY OF NAVFAC'S JUSTIFICATION FOR MAKING AN AWARD NOTWITHSTANDING THE PROTEST.