B-172879, OCT 1, 1971

B-172879: Oct 1, 1971

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GAO HAS HELD THAT IT IS THE RESPONSIBILITY OF THE CONTRACTING AGENCIES TO DETERMINE WHEN THE NEEDS OF THE GOVERNMENT REQUIRE A SOLE SOURCE PROCUREMENT UNDER 10 U.S.C. 2304(A)(10). THE FINDINGS ISSUED BY THE CONTRACTING OFFICER AS A BASIS FOR DETERMINING THAT THE PROCUREMENT SHOULD BE SOLE-SOURCE ARE FINAL. THERE IS NO LEGAL BASIS TO OBJECT TO THE PROPOSED AWARD. MCDERMOTT CORPORATION: REFERENCE IS MADE TO YOUR TELEGRAM OF MAY 6. A QUOTATION ALSO WAS REQUESTED FOR TESTING 8 PREPRODUCTION PROTOTYPE SAMPLES OF THE LIGHT. THE AIR FORCE ADVISED THAT AWARD IS BEING WITHHELD PENDING COMPLETION OF NEGOTIATIONS AND OUR DECISION ON YOUR PROTEST. YOU HAVE PROTESTED THE SOLE-SOURCE ASPECT OF THE PROCUREMENT ESSENTIALLY ON FIVE GROUNDS.

B-172879, OCT 1, 1971

BID PROTEST - SOLE-SOURCE PROCUREMENT DENIAL OF PROTEST AGAINST THE PROPOSED AWARD OF A CONTRACT FOR DISTRESS MARKER LIGHTS TO THE ACR ELECTRONICS DIVISION OF CHROMALLOY AMERICAN CORPORATION BY THE DEPARTMENT OF THE AIR FORCE UNDER AN RFP ISSUED BY THE LIFE SUPPORT SYSTEM PROGRAM OFFICE, AERONAUTICAL SYSTEMS DIVISION, WRIGHT- PATTERSON AFB, OHIO. GAO HAS HELD THAT IT IS THE RESPONSIBILITY OF THE CONTRACTING AGENCIES TO DETERMINE WHEN THE NEEDS OF THE GOVERNMENT REQUIRE A SOLE SOURCE PROCUREMENT UNDER 10 U.S.C. 2304(A)(10). FURTHER, UNDER 10 U.S.C. 2310(B), THE FINDINGS ISSUED BY THE CONTRACTING OFFICER AS A BASIS FOR DETERMINING THAT THE PROCUREMENT SHOULD BE SOLE-SOURCE ARE FINAL. THEREFORE, THERE IS NO LEGAL BASIS TO OBJECT TO THE PROPOSED AWARD.

TO JULIAN A. MCDERMOTT CORPORATION:

REFERENCE IS MADE TO YOUR TELEGRAM OF MAY 6, 1971, AND LETTER DATED MAY 11, 1971, WITH ENCLOSURE, PROTESTING AGAINST THE PROPOSED AWARD OF A CONTRACT FOR DISTRESS MARKER LIGHTS TO THE ACR ELECTRONICS DIVISION OF CHROMALLOY AMERICAN CORPORATION BY THE DEPARTMENT OF THE AIR FORCE UNDER REQUEST FOR PROPOSALS (RFP) F33657-71-R-0758, ISSUED BY THE LIFE SUPPORT SYSTEM PROGRAM OFFICE, ASD/SMLK, AFSC, AERONAUTICAL SYSTEMS DIVISION, WRIGHT-PATTERSON AIR FORCE BASE, OHIO.

THE RFP, ISSUED ONLY TO ACR ELECTRONICS ON APRIL 2, 1971, REQUESTED A QUOTATION FOR FURNISHING 12,535 SDU-30/E DISTRESS MARKER LIGHTS FOR 7 MAN AND 20-MAN LIFE RAFTS. A QUOTATION ALSO WAS REQUESTED FOR TESTING 8 PREPRODUCTION PROTOTYPE SAMPLES OF THE LIGHT. IN RESPONSE, ACR ELECTRONICS SUBMITTED A PROPOSAL DATED APRIL 5, 1971, AS AMENDED BY LETTER DATED APRIL 12, 1971, OFFERING TO FURNISH THE LIGHTS AT THE PRICE QUOTED THEREIN. HOWEVER, IN LETTER OF SEPTEMBER 8, 1971, REPORTING ON THE PROTEST, THE AIR FORCE ADVISED THAT AWARD IS BEING WITHHELD PENDING COMPLETION OF NEGOTIATIONS AND OUR DECISION ON YOUR PROTEST.

YOU HAVE PROTESTED THE SOLE-SOURCE ASPECT OF THE PROCUREMENT ESSENTIALLY ON FIVE GROUNDS. FIRST, YOU HAVE STATED THAT THE COMPONENTS OF THE LIGHT ARE STANDARD COMMERCIAL ITEMS OR ARE EASILY FABRICATED FROM STANDARD ITEMS AND THEREFORE, THE ITEM IS NOT SUFFICIENTLY COMPLICATED TO WARRANT SOLE- SOURCE PROCUREMENT. SECOND, YOU HAVE STATED THAT THE DELIVERY REQUIREMENTS ARE NOT SO STRINGENT AS TO REQUIRE SOLE-SOURCE PROCUREMENT. THIRD, YOU HAVE STATED THAT THE GOVERNMENT OUGHT TO KNOW ENOUGH ABOUT THE REQUIREMENTS TO WRITE A SPECIFICATION FOR THE SDU-30/E DISTRESS MARKER LIGHT. FOURTH, YOU HAVE STATED THAT ACR ELECTRONICS HAS BEEN NONCOMPETITIVE IN OPEN BIDDING ON AIR-SEA RESCUE DEVICES. FINALLY, YOU QUESTION THE URGENCY OF THE DELIVERY REQUIREMENT BECAUSE YOU STATE THAT EXISTING SIGNALLING DEVICES COULD BE USED OR A QUANTITY OF ABOUT 500 SDU- 30E LIGHTS COULD BE PROCURED UNTIL A DEVELOPMENT PROGRAM IS COMPLETED TO MEET THE AIR FORCE REQUIREMENTS.

THE DETERMINATION TO SOLE SOURCE THE PROCUREMENT IS BASED UPON A "DETERMINATION AND FINDINGS" (D&F) MADE BY THE CONTRACTING OFFICER PURSUANT TO THE AUTHORITY OF 10 U.S.C. 2304(A)(10), AS IMPLEMENTED BY ARMED SERVICES PROCUREMENT REGULATION (ASPR) 3-210.2(I). THE D&F PROVIDED:

"FINDINGS

"1. THE AIR FORCE SYSTEMS COMMAND PROPOSES TO PROCURE BY NEGOTIATION A QUANTITY OF 12,535 EA LIGHT, MARKER DISTRESS AT AN ESTIMATED TOTAL COST OF $705,093.75. A 50% OPTION PROVISION WILL ALSO BE NEGOTIATED. THIS EQUIPMENT IS REQUIRED FOR MULTIPLACE LIFE RAFTS TO PROVIDE AIRCREWMEMBERS WITH A HIGH-INTENSITY VISUAL DISTRESS SIGNAL IN THE EVENT OF UNSCHEDULED DITCHING OF AIRCRAFT.

"2. PROCUREMENT BY NEGOTIATION OF THE ABOVE DESCRIBED SPECIAL SUPPORT EQUIPMENT IS NECESSARY BECAUSE THE MANUFACTURER MUST HAVE A DETAILED KNOWLEDGE OF THE BASIC EQUIPMENT TO BE SUPPORTED. THE SPECIAL EQUIPMENT TO BE PROCURED MUST BE SPECIALLY DESIGNED TO BE COMPATIBLE WITH THE BASIC EQUIPMENT.

"3. USE OF FORMAL ADVERTISING FOR PROCUREMENT OF THE ABOVE DESCRIBED SPECIAL SUPPORT EQUIPMENT IS IMPRACTICABLE BECAUSE ONLY ACR ELECTRONICS INC. IS CURRENTLY CAPABLE OF SUPPLYING THE AIR FORCE THE REQUIRED DISTRESS MARKER LIGHT IN THE QUANTITY AND TIME REQUIRED. ACR ELECTRONICS DESIGNED, FABRICATED AND TESTED THIS LIGHT INCLUDING MOUNTING ON THE MULTIPLACE RAFTS ON WHICH IT IS TO BE USED SOLELY 'WITHIN HOUSE' AND WITHOUT GOVERNMENT FUNDING. THIS CONTRACTOR IS THE ONLY ONE CURRENTLY FAMILIAR ENOUGH WITH THE OPERATIONAL REQUIREMENTS OF THE SPECIAL SUPPORT EQUIPMENT AS WELL AS THE DESIGN CHARACTERISTICS OF THE BASIC EQUIPMENT TO FURNISH THE SPECIAL SUPPORT EQUIPMENT REQUIRED.

"DETERMINATION

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

FURTHER, THE CONTRACTING OFFICER HAS INDICATED THAT WHILE CERTAIN COMPONENTS OF THE LIGHT MAY BE PURCHASED FROM COMMERCIAL SOURCES, WHAT IS INVOLVED IS MORE THAN AN ASSEMBLY PROCEDURE SINCE DESIGN AND DEVELOPMENT WORK IS REQUIRED TO MANUFACTURE A LIGHT THAT WILL MEET THE AIR FORCE REQUIREMENT THAT THE LIGHT HAVE A VISIBILITY OF 10 NAUTICAL MILES. THIS CONNECTION, THE CONTRACTING OFFICER HAS INDICATED THAT THE AIR FORCE DOES NOT PRESENTLY HAVE SUFFICIENT INFORMATION AND DATA TO PREPARE SPECIFICATION FOR A COMPETITIVE PROCUREMENT, BUT THAT REPROCUREMENT DATA WILL BE PROCURED UNDER THE RFP AND THAT THE ITEM WILL BE ABLE TO BE COMPETITIVELY PROCURED IN THE FUTURE. IN THIS REGARD, THE CONTRACTING OFFICER HAS ADVISED THAT THE LIGHT WAS DEVELOPED BY ACR ELECTRONICS AND THAT IF THE GOVERNMENT WERE TO DEVELOP A SPECIFICATION FOR THE LIGHT IT WOULD REQUIRE A TWO-YEAR DEVELOPMENT PROGRAM AND CONSIDERABLE EXPENSE. THEREFORE, REGARDLESS OF WHETHER THE DELIVERY REQUIREMENTS ARE STRINGENT OR NOT, THE FACT REMAINS THAT THE AIR FORCE REPRESENTS THAT IT DOES NOT HAVE ADEQUATE DATA ON THE LIGHTS TO PERMIT IT TO BE COMPLETED AT THIS TIME.

ADDITIONALLY, THE CONTRACTING OFFICER DISAGREES THAT ACR ELECTRONICS HAS BEEN NONCOMPETITIVE IN OPEN BIDDING ON OTHER AIR-SEA DEVICES. IN THIS CONNECTION, IT IS REPORTED THAT ACR ELECTRONICS WAS AWARDED THE INITIAL CONTRACT FOR THE DEVELOPMENT OF THE SDU-5E STROBE LIGHT; THAT THE ITEM IS NOW BEING PROCURED COMPETITIVELY BY THE DEFENSE SUPPLY AGENCY, RICHMOND, VIRGINIA; THAT ACR ELECTRONICS HAS BEEN THE SUCCESSFUL BIDDER ON ONE AWARD SINCE THEN FOR 15,000 UNITS AT $10.31 EACH; THAT THE ITEM HAS ALSO BEEN AWARDED TO NEO FLASHER AND TO ELCO IN QUANTITIES FROM 20 TO 43,000 AND AT PRICES RANGING FROM $9.75 EACH TO $10.37 EACH; AND THAT ACR ELECTRONICS HAS ALWAYS BEEN IN A COMPETITIVE RANGE. IT IS REPORTED ALSO THAT ACR HAS BEEN COMPETITIVE IN THE PROCUREMENT OF SPARE PARTS FOR THE SDU-5E STROBE LIGHT. IN ANY EVENT, SEE THE PROCEDURES IN ASPR 3-807.2 ET SEQ., PROVIDING REQUIREMENTS FOR PRICE AND COST ANALYSIS IN NEGOTIATED PROCUREMENTS TO ASSURE REASONABLENESS OF PRICE IN CONTRACTS RESULTING FROM THE NEGOTIATIONS. FINALLY, THE CONTRACTING OFFICER HAS STATED THAT PRESENT USING COMMANDS REQUIREMENTS CANNOT AFFORD THE DELAY INHERENT IN A NEW DEVELOPMENT PROGRAM; THAT THE NEED FOR THE TOTAL QUANTITY OF 12,535 SDU-30/E DISTRESS MARKER LIGHTS IS URGENT TO SUPPORT LIFE SAVING OPERATIONS WITHIN THE UNITED STATES AIR FORCE; AND THAT LIFE SAVING CAPABILITY IN SURVIVAL/RECOVERY SITUATIONS IS DEFINITELY IMPAIRED WITHOUT THIS LIGHT.

AS INDICATED ABOVE, THE DETERMINATION TO PROCURE ON A SOLE-SOURCE BASIS WAS MADE UNDER 10 U.S.C. 2304(A)(10). OUR OFFICE HAS HELD THAT IT IS THE RESPONSIBILITY OF THE CONTRACTING AGENCIES OF THE GOVERNMENT TO DETERMINE WHEN THE NEEDS OF THE GOVERNMENT REQUIRE A SOLE-SOURCE PROCUREMENT UNDER 10 U.S.C. 2304(A)(10). B-171025, FEBRUARY 9, 1971, AND DECISIONS CITED THEREIN. FURTHER, UNDER 10 U.S.C. 2310(B), THE FINDINGS ISSUED BY THE CONTRACTING OFFICER AS A BASIS FOR DETERMINING THAT THE PROCUREMENT SHOULD BE NEGOTIATED WITH ACR ELECTRONICS PURSUANT TO 10 U.S.C. 2304(A)(10) ARE FINAL.

WE THEREFORE FIND NO LEGAL BASIS TO OBJECT TO THE PROPOSED AWARD OF A CONTRACT TO ACR ELECTRONICS ..END :