B-172946(1), DEC 23, 1971

B-172946(1): Dec 23, 1971

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WAS INTENDED RUNS COUNTER TO SECTION D OF THE RFP AND IS WITHOUT MERIT. IT CANNOT BE CONCLUDED FROM THIS RECORD THAT THE EVALUATION WAS PREJUDICIAL TO PROTESTANT OR THAT THE EDMAC PROPOSAL WAS IMPROPERLY EVALUATED. THE TELEGRAM SENT BY PROTESTANT REDUCING ITS BID PRICE WAS SENT AFTER THE CLOSING DATE FOR "BEST AND FINAL OFFERS" AND. AWARD WAS MADE TO EDMAC ON JUNE 1. PROPOSALS WERE TO BE SUBMITTED BY MARCH 26. EACH OFFEROR WAS REQUIRED TO PROVIDE SOLUTIONS TO VARIOUS TECHNICAL PROBLEMS EXISTING IN THE SERVICE TEST MODEL OF THE AN/ARR-75. ALTHOUGH FIVE PROPOSALS WERE RECEIVED IN RESPONSE TO THE SOLICITATION. WERE DETERMINED TO BE TECHNICALLY ACCEPTABLE. EDMAC AND RESDEL WERE TELEPHONICALLY ADVISED BY THE CONTRACTING OFFICER THAT AWARD WOULD BE BASED ON PRICE ALONE.

B-172946(1), DEC 23, 1971

BID PROTEST - EVALUATION PROCEDURES - "NEGOTIATIONS" - LATE MODIFICATION TO BID DENIAL OF PROTEST AGAINST THE AWARD OF A CONTRACT TO EDMAC ASSOCIATES, INC., UNDER AN RFP ISSUED BY THE NAVAL AIR SYSTEMS COMMAND, WASHINGTON, D.C., FOR 52 AN/ARR-75 RADIO RECEIVER SETS WITH ASSOCIATED EQUIPMENT AND DATA, INCLUDING AN OPTION FOR AN ADDITIONAL 25 SETS. THE CONTENTION THAT THE REQUEST FOR A BEST AND FINAL OFFER LEFT SOME REASONABLE DOUBT AS TO WHETHER EVALUATION ON THE TOTAL AMOUNT, INCLUDING OPTION, WAS INTENDED RUNS COUNTER TO SECTION D OF THE RFP AND IS WITHOUT MERIT. ALSO, IT CANNOT BE CONCLUDED FROM THIS RECORD THAT THE EVALUATION WAS PREJUDICIAL TO PROTESTANT OR THAT THE EDMAC PROPOSAL WAS IMPROPERLY EVALUATED. IN VIEW OF THE WIDE DISCRETION VESTED IN THE CONTRACTING OFFICER TO DETERMINE THE NATURE AND SCOPE OF THE NEGOTIATIONS ON A PARTICULAR PROCUREMENT, IT CANNOT BE CONCLUDED THAT THE FAILURE TO CONDUCT MORE EXTENSIVE NEGOTIATIONS CONSTITUTED AN ABUSE OF DISCRETION. FURTHER, THE TELEGRAM SENT BY PROTESTANT REDUCING ITS BID PRICE WAS SENT AFTER THE CLOSING DATE FOR "BEST AND FINAL OFFERS" AND, THEREFORE, CONSTITUTED A LATE MODIFICATION WITHIN THE SCOPE OF PARAGRAPH 8 OF THE RFP AND, AS SUCH, COULD NOT BE FAVORABLY CONSIDERED.

TO RESDEL ENGINEERING CORPORATION:

WE REFER TO YOUR TELEFAX OF MAY 14, 1971, AND SUBSEQUENT CORRESPONDENCE, PROTESTING AGAINST THE AWARD OF A CONTRACT TO EDMAC ASSOCIATES, INC., UNDER REQUEST FOR PROPOSALS (RFP) N00019-71-R-0120, ISSUED BY THE NAVAL AIR SYSTEMS COMMAND (NAVAIR), WASHINGTON, D.C. AWARD WAS MADE TO EDMAC ON JUNE 1, 1971.

THE SOLICITATION, ISSUED ON FEBRUARY 25, 1971, COVERED THE PROCUREMENT OF A FIRM QUANTITY OF 52 AN/ARR-75 RADIO RECEIVER SETS WITH ASSOCIATED EQUIPMENT AND DATA, INCLUDING AN OPTION FOR AN ADDITIONAL 25 SETS. PROPOSALS WERE TO BE SUBMITTED BY MARCH 26, 1971. IN ITS TECHNICAL PROPOSAL, EACH OFFEROR WAS REQUIRED TO PROVIDE SOLUTIONS TO VARIOUS TECHNICAL PROBLEMS EXISTING IN THE SERVICE TEST MODEL OF THE AN/ARR-75, WHICH HAD BEEN DEVELOPED BY THE GENERAL DYNAMICS CORPORATION UNDER A PREVIOUS CONTRACT. THE PROPOSAL DESIGN HAD TO COMPLY WITH SPECIFICATION MIL-R-81681(AS). ALTHOUGH FIVE PROPOSALS WERE RECEIVED IN RESPONSE TO THE SOLICITATION, AFTER TECHNICAL EVALUATION ONLY THE PROPOSALS OF THE RESDEL ENGINEERING CORPORATION AND EDMAC ASSOCIATES, INC., WERE DETERMINED TO BE TECHNICALLY ACCEPTABLE. THEREAFTER, ON APRIL 30, 1971, EDMAC AND RESDEL WERE TELEPHONICALLY ADVISED BY THE CONTRACTING OFFICER THAT AWARD WOULD BE BASED ON PRICE ALONE, AND BY LETTER OF THAT DATE EACH OFFEROR WAS REQUESTED TO SUBMIT THEIR BEST AND FINAL OFFERS. SUCH OFFERS WERE SUBMITTED BY RESDEL AND EDMAC BY MAY 7, 1971, THE SPECIFIED CLOSING DATE. THESE OFFERS WERE AS FOLLOWS:

WITH OPTION WITHOUT OPTION

EDMAC $1,145,269 $898,894

RESDEL $1,147,880 885,630

CONSIDERING THE TOTAL QUANTITY, OPTION QUANTITY INCLUDED, EDMAC WAS DETERMINED TO BE THE LOWEST, RESPONSIBLE OFFEROR AND, AS SUCH, WAS SELECTED FOR AWARD. ON MAY 12, 1971, EDMAC SUBMITTED A MODIFICATION REDUCING ITS PRICE FOR THE OPTION QUANTITY BY $16,375. PURSUANT TO PARAGRAPH 3-506(G) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR), THIS PRICE REDUCTION WAS ACCEPTED AS "A MODIFICATION RECEIVED FROM AN OTHERWISE SUCCESSFUL OFFEROR WHICH IS FAVORABLE TO THE GOVERNMENT."

RESDEL PROTESTS THE AWARD TO EDMAC FOR SEVERAL REASONS. FIRST, IT QUESTIONS THE PROPRIETY OF MAKING AN AWARD BASED UPON EVALUATION OF THE TOTAL OFFERED PRICE WHERE THE LIKELIHOOD OF THE OPTION BEING EXERCISED IS REASONABLY LOW. RESDEL CONTENDS THAT THE PROJECTED ALLOCATIONS FOR FISCAL YEAR 1972 MAKE THE PROBABILITY OF 25 UNITS BEING AWARDED UNDER THE OPTION REMOTE. THE INTENT OF THE APRIL 30 LETTER REQUESTING SUBMISSION OF A "BEST AND FINAL OFFER *** IF PRICE IS REVISED" IS ALSO QUESTIONED, IN THAT THIS WORDING, CAST IN THE SINGULAR, IS BELIEVED TO HAVE RAISED A REASONABLE DOUBT AS TO WHETHER AN EVALUATION OF THE TOTAL PRICE INCLUDING OPTIONS WAS INTENDED.

SECONDLY, IT IS ALLEGED THAT THE APPLICATION OF THE EVALUATION CRITERIA DURING THE TECHNICAL EVALUATION OF THE PROPOSALS WAS ARBITRARY AND CAPRICIOUS. THIS IS BASED ON THE FACT THAT RESDEL DESIGNED AND MANUFACTURED, ON ITS OWN INITIATIVE, A TEST MODEL OF THE IMPROVED AN/ARR- 75 WHICH MET ALL SPECIFICATION REQUIREMENTS AND DEMONSTRATED ITS COMPLETE UNDERSTANDING OF THE SCOPE OF WORK OF THE RFP. RESDEL THEREFORE BELIEVES THAT ANY PROPOSAL NOT INVOLVING THE DESIGN AND CONSTRUCTION OF A FULLY COMPLIANT TEST MODEL CANNOT PROPERLY BE RANKED EQUAL TO A PROPOSAL STRUCTURED FROM SUCH A MODEL. FURTHER, AS EDMAC HAS HAD NO PAST EXPERIENCE AND PERFORMANCE AS A CORPORATE ENTITY ON ANY PROGRAMS RELATED TO THE REQUIREMENTS OF THE RFP, ANY ACHIEVEMENTS ON THE PART OF KEY PERSONNEL OF EDMAC MUST BE RELATED, NOT TO EDMAC, BUT TO THEIR PREVIOUS EMPLOYER. RESDEL POINTS OUT THAT EDMAC'S EXPERIENCE AND PERFORMANCE, WHEN CONTRASTED TO RESDEL'S HIGH LEVEL OF RESPONSIBILITY AND RESPONSIVE PERFORMANCE ON RELATED PROGRAMS, ARE SIGNIFICANTLY DEFICIENT. ALSO, TO YOUR KNOWLEDGE, THE CAPABILITIES AND FACILITIES PROPOSED BY EDMAC ARE ONLY PLANNED AND CONJECTURAL, RATHER THAN ACTUAL AND AVAILABLE. FINALLY, AS REGARDS THE EVALUATION UNDER THE RFP OF ORGANIZATION MANAGEMENT AND CONTROL AND PERSONNEL EXPERIENCE AND COMMITMENTS, IT IS CONTENDED THAT SINCE EDMAC IS A NEWLY FORMED CORPORATION WHOSE PERSONNEL HAS LIMITED EXPERIENCE, ITS QUALIFICATIONS TO PRODUCE A NEW GENERATION OF AN/ARR-75 RECEIVER SETS ARE INADEQUATE WHEN COMPARED TO RESDEL'S EXPERIENCE AND KNOW -HOW.

THIRDLY, IT IS CONTENDED THAT ALTHOUGH 10 U.S.C. 2304(G) REQUIRES NEGOTIATIONS TO BE CONDUCTED WITH ALL OFFERORS WITHIN A COMPETITIVE RANGE, THE PROCUREMENT AGENCY DID NOT ENTER INTO NEGOTIATIONS WITH RESDEL WHICH MIGHT HAVE RESULTED IN SAVINGS TO THE GOVERNMENT.

FINALLY, YOU CONTEND THAT BECAUSE THE COMMERCE BUSINESS DAILY ANNOUNCEMENT OF THIS PROCUREMENT INDICATED THAT FIRMS WOULD BE SOLICITED ON THE BASIS OF HAVING PARTICIPATED IN PREVIOUS AN/ARR-75 PROCUREMENTS, THE PARTICIPATION OF EDMAC WAS IN VIOLATION OF NAVAIR'S OWN PUBLISHED GUIDELINES.

AS TO YOUR FIRST CONTENTION CONCERNING THE OPTION WHICH WE UNDERSTAND WAS EXERCISED ON OCTOBER 27, 1971, PARAGRAPH J-1 OF THE RFP SCHEDULE PROVIDED THAT THE "GOVERNMENT RESERVES THE RIGHT TO EXERCISE THE GOVERNMENT OPTION *** AT THE TIME OF AWARD." MOREOVER, SECTION D OF THE RFP, ENTITLED "EVALUATION OF OPTIONS," PROVIDES:

"A. BIDS AND PROPOSALS WILL BE EVALUATED FOR PURPOSES OF AWARD BY ADDING THE TOTAL PRICE FOR ALL OPTION QUANTITIES TO THE TOTAL PRICE FOR THE BASIC QUANTITY. EVALUATION OF OPTIONS WILL NOT OBLIGATE THE GOVERNMENT TO EXERCISE THE OPTION OR OPTIONS."

YOUR VIEW THAT THE REQUEST, CAST IN THE SINGULAR, FOR THE SUBMISSION OF A "BEST AND FINAL OFFER *** IF PRICE IS REVISED" LEAVES SOME REASONABLE DOUBT AS TO WHETHER EVALUATION ON A TOTAL PRICE, INCLUDING OPTION, WAS INTENDED RUNS COUNTER TO THE RFP PROVISION QUOTED ABOVE. IN ANY EVENT, RESDEL SUBMITTED BEST AND FINAL PRICES ON THE BASIS OF THE FIRM QUANTITY AND ON THE BASIS OF THE OPTION QUANTITY INCLUDED.

REGARDING RESDEL'S ASSERTION THAT THE RFP CRITERIA WAS NOT FOLLOWED IN EVALUATING THE PROPOSALS FOR AWARD, THE RECORD ESTABLISHES THAT THE TECHNICAL PROPOSALS OF EDMAC AND RESDEL WERE EVALUATED AND BOTH WERE FOUND TO BE TECHNICALLY ACCEPTABLE. THIS RESULTED FROM AN EVALUATION WHICH WAS CONDUCTED IN ACCORDANCE WITH THE TERMS OF THE RFP IN A MANNER COMMON TO ALL OFFERORS. BASED ON OUR REVIEW OF THE RECORD, WE CANNOT CONCLUDE THAT THE EVALUATION WAS PREJUDICIAL TO RESDEL OR THAT THE EDMAC PROPOSAL WAS IMPROPERLY EVALUATED.

SECTION 2304(G) OF TITLE 10 OF THE U.S.C. AND ITS IMPLEMENTING REGULATIONS AT ASPR 3-805.1 PROVIDE THAT, WITH CERTAIN EXCEPTIONS NOT APPLICABLE HERE, WRITTEN OR ORAL DISCUSSIONS MUST BE CONDUCTED WITH ALL OFFERORS IN A COMPETITIVE RANGE. HERE, "DISCUSSIONS" WERE HELD WITH BOTH WHEN OFFERORS WERE REQUESTED TO SUBMIT BEST AND FINAL OFFERS. ASPR 3-804 PROVIDES, IN PERTINENT PART, THAT:

" *** COMPLETE AGREEMENT OF THE PARTIES ON ALL BASIC ISSUES SHALL BE THE OBJECTIVE OF THE CONTRACT NEGOTIATIONS. ORAL DISCUSSIONS OR WRITTEN COMMUNICATIONS SHALL BE CONDUCTED WITH OFFERORS TO THE EXTENT NECESSARY TO RESOLVE UNCERTAINTIES RELATING TO THE PURCHASE OR THE PRICE TO BE PAID.

IN THE OPINION OF THE PROCUREMENT PERSONNEL, NO UNCERTAINTIES EXISTED AS TO THE TECHNICAL ASPECTS OF RESDEL'S PROPOSAL. IT IS REPORTED THAT THE SIX ASSUMPTIONS UPON WHICH YOU BASED YOUR PROPOSAL MADE COMMON SENSE AND WERE CONCURRED IN BY NAVAIR. FURTHER, AS THESE ASSUMPTIONS WERE BELIEVED TO REPRESENT THE LOWEST COST TECHNICAL APPROACH FOR RESDEL, NO DISCUSSIONS OR NEGOTIATIONS WITH RESDEL WERE REQUIRED IN THIS AREA. ALTHOUGH THE PROCUREMENT ACTIVITY COULD HAVE EXERCISED GREATER EFFORTS OVER AND BEYOND A REQUEST FOR BEST AND FINAL OFFERS TO OBTAIN BETTER PRICE CONCESSIONS, IN VIEW OF THE WIDE DISCRETION VESTED IN THE CONTRACTING OFFICER TO DETERMINE THE NATURE AND SCOPE OF NEGOTIATIONS IN A PARTICULAR PROCUREMENT, WE CANNOT CONCLUDE THAT HIS FAILURE TO CONDUCT MORE EXTENSIVE NEGOTIATIONS CONSTITUTED AN ABUSE OF DISCRETION. SEE 49 COMP. GEN. 625, 634-35 (1970).

TURNING NOW TO YOUR ALLEGATION THAT THE MAY 13, 1971, TELEGRAM REDUCING RESDEL'S PRICE FOR THE OPTION QUANTITY SHOULD HAVE SERVED AS A BASIS FOR FURTHER DISCUSSIONS, WE NOTE THAT THE TELEGRAM WAS RECEIVED AFTER THE "BEST AND FINAL" OFFER CLOSING DATE. THE TELEGRAM, THEREFORE, WAS A LATE MODIFICATION WITHIN THE PURVIEW OF PARAGRAPH 8 OF THE RFP INSTRUCTIONS AND CONDITIONS AND, AS SUCH, COULD NOT BE FAVORABLY CONSIDERED.

FINALLY, WE FIND NO MERIT IN YOUR CONTENTION THAT NAVAIR SOLICITED EDMAC IN VIOLATION OF ITS GUIDELINES FOR THE PROCUREMENT. THE RECORD DEMONSTRATES THAT EDMAC PERSONNEL HAD PARTICIPATED IN PAST SIMILAR PROCUREMENTS AND THAT THIS AND OTHER FACTORS WERE CONSIDERED BY NAVAIR IN DETERMINING THAT EDMAC WAS QUALIFIED TECHNICALLY TO PARTICIPATE IN THIS PROCUREMENT.

ACCORDINGLY, THE PROTEST IS DENIED.