B-173522, JAN 25, 1972, 51 COMP GEN 431

B-173522: Jan 25, 1972

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CONTRACTS - NEGOTIATION - COMPETITION - DISCUSSION WITH ALL OFFERORS REQUIREMENT - SPECIFICATION ADEQUACY EFFECT THE AWARD OF A CONTRACT ON THE BASIS OF AN INITIAL PROPOSAL BECAUSE THE SPECIFICATIONS IN THE REQUEST FOR PROPOSALS ARE CONSIDERED TO ADEQUATELY DESCRIBE THE GOVERNMENT'S REQUIREMENTS WAS NOT JUSTIFIED SINCE. ADEQUATE SPECIFICATIONS ARE NOT AN EXCEPTION FROM THE REQUIREMENT TO CONDUCT DISCUSSIONS WITH ALL OFFERORS WITHIN A COMPETITIVE RANGE AND. PROSPECTIVE CONTRACTORS SUBMITTING PROPOSALS THAT ARE NOT MATERIALLY DEFICIENT AND CAN BE MADE ACCEPTABLE THROUGH MINOR REVISIONS OR MODIFICATIONS SHOULD BE AFFORDED AN OPPORTUNITY TO SATISFY THE GOVERNMENT'S REQUIREMENTS RATHER THAN CLOSING THE DOOR TO POSSIBLE FRUITFUL NEGOTIATIONS.

B-173522, JAN 25, 1972, 51 COMP GEN 431

CONTRACTS - NEGOTIATION - COMPETITION - DISCUSSION WITH ALL OFFERORS REQUIREMENT - SPECIFICATION ADEQUACY EFFECT THE AWARD OF A CONTRACT ON THE BASIS OF AN INITIAL PROPOSAL BECAUSE THE SPECIFICATIONS IN THE REQUEST FOR PROPOSALS ARE CONSIDERED TO ADEQUATELY DESCRIBE THE GOVERNMENT'S REQUIREMENTS WAS NOT JUSTIFIED SINCE, PURSUANT TO PARAGRAPH 3-805-1 OF THE ARMED SERVICES PROCUREMENT REGULATION, ADEQUATE SPECIFICATIONS ARE NOT AN EXCEPTION FROM THE REQUIREMENT TO CONDUCT DISCUSSIONS WITH ALL OFFERORS WITHIN A COMPETITIVE RANGE AND, THEREFORE, PROSPECTIVE CONTRACTORS SUBMITTING PROPOSALS THAT ARE NOT MATERIALLY DEFICIENT AND CAN BE MADE ACCEPTABLE THROUGH MINOR REVISIONS OR MODIFICATIONS SHOULD BE AFFORDED AN OPPORTUNITY TO SATISFY THE GOVERNMENT'S REQUIREMENTS RATHER THAN CLOSING THE DOOR TO POSSIBLE FRUITFUL NEGOTIATIONS, AND DISCUSSIONS MUST BE MEANINGFUL AND FURNISH INFORMATION TO ALL OFFERORS IN A COMPETITIVE RANGE AS TO THE AREAS IN WHICH THEIR PROPOSALS ARE DEFICIENT TO ENABLE THEM TO SATISFY REQUIREMENTS. CONTRACTS - NEGOTIATION - REQUEST FOR PROPOSALS - BRAND NAME OR EQUAL PROCEDURE WHEN THE BRAND NAME OR EQUAL CLAUSE CONTAINED IN PARAGRAPH 1 1206.3(B) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) AND WRITTEN FOR ADVERTISED PROCUREMENTS IS ADOPTED FOR USE IN NEGOTIATED PROCUREMENTS PURSUANT TO ASPR 1-1206.5 AND 3-501(BCXXV), THE CLAUSE SHOULD BE SUITABLY MODIFIED. THE MERE SUBSTITUTION OF THE WORDS "OFFEROR" FOR "BIDDER" AND "OFFER" FOR "BID" LEAVES RESTRICTIONS IN A REQUEST FOR PROPOSALS (RFP) WHICH ARE CONTRARY TO THE INTENT AND PURPOSES OF NEGOTIATED PROCUREMENT. FURTHERMORE, THE INCLUSION IN AN RFP OF A PROVISION SIMILAR TO PARAGRAPH (C)(3) OF THE CLAUSE, WHICH PRECLUDES MODIFICATION AFTER BID OPENING TO MAKE A PRODUCT CONFORM TO A BRAND NAME IS INCONSISTENT WITH THE PRINCIPLE OF ALLOWING MODIFICATIONS IN PROPOSALS PURSUANT TO ASPR 3-805.1(B).

TO THE SECRETARY OF THE AIR FORCE, JANUARY 25, 1972:

ENCLOSED IS A COPY OF OUR DECISION OF TODAY RELATIVE TO THE PROTEST OF MATERIALS RESEARCH CORPORATION (MRC), UNDER REQUEST FOR PROPOSALS F30635- 71-R-0397, ISSUED BY THE BASE PROCUREMENT DIVISION, GRIFFISS AIR FORCE BASE, NEW YORK.

ALTHOUGH OUR DECISION HAS DENIED THE PROTEST, WE BELIEVE CERTAIN ASPECTS OF THIS PROCUREMENT WARRANT FURTHER COMMENT.

THE CONTRACTING OFFICER STATED IN HIS STATEMENT OF FACTS AND FINDINGS CONCERNING THIS PROTEST THAT IT WAS CONTEMPLATED THE AWARD COULD BE MADE BASED ON THE PROPOSALS SUBMITTED WITHOUT FURTHER DISCUSSIONS WITH THE OFFERORS BECAUSE THE SPECIFICATIONS SET FORTH IN THE RFP ADEQUATELY DESCRIBED THE GOVERNMENT'S REQUIREMENTS. NONE OF THE EXCEPTIONS FROM THE REQUIREMENT TO CONDUCT DISCUSSIONS WITH ALL OFFERORS WITHIN A COMPETITIVE RANGE, AS STATED IN ASPR 3-805.1, INDICATE THAT ADEQUATE SPECIFICATIONS ARE A JUSTIFICATION FOR MAKING AN AWARD BASED ON INITIAL PROPOSALS WITHOUT FURTHER DISCUSSIONS.

THE FIRST EVALUATION FOUND SIGNIFICANT EXCEPTIONS IN MRC'S PROPOSAL (OPTION I), HOWEVER, SUCH EXCEPTIONS WERE NOT CONSIDERED DISQUALIFYING. ALTHOUGH THE SECOND EVALUATION FOUND ADDITIONAL EXCEPTIONS, THE RECORD DOES NOT SHOW THAT THE PROPOSAL WAS CONSIDERED TO BE SO MATERIALLY DEFICIENT THAT IT COULD NOT HAVE BEEN MADE ACCEPTABLE THROUGH MINOR REVISIONS OR MODIFICATIONS. WE BELIEVE THAT ADDITIONAL NEGOTIATIONS SUBSEQUENT TO THE SECOND REPORT SHOULD HAVE BEEN CONDUCTED TO HAVE MADE IT CLEAR TO MRC THAT REVISIONS TO THEIR OFFER WITH REGARD TO THESE EXCEPTIONS WERE NECESSARY TO MAKE THEIR OFFER ACCEPTABLE. ALTHOUGH WE DO NOT INTEND TO OUTLINE THE EXTENT OF NEGOTIATIONS IN EACH PROCUREMENT SITUATION, UNLESS INITIALLY UNACCEPTABLE PROPOSALS ARE FOUND NOT SUBJECT TO BEING MADE ACCEPTABLE, EXCEPT THROUGH MAJOR REVISIONS, PROSPECTIVE CONTRACTORS SHOULD BE AFFORDED AN OPPORTUNITY TO SATISFY THE REQUIREMENTS OF THE GOVERNMENT, RATHER THAN CLOSE THE DOOR TO POSSIBLE FRUITFUL NEGOTIATIONS. ASPR 3 805.1(B) STATES, IN CONNECTION WITH DISCUSSIONS CONDUCTED WITH OFFERORS WHO SUBMIT PROPOSALS WITHIN A COMPETITIVE RANGE, THAT:

*** ALL OFFERORS SELECTED TO PARTICIPATE IN SUCH NEGOTIATIONS *** SHALL BE OFFERED AN EQUITABLE OPPORTUNITY TO SUBMIT SUCH PRICE, TECHNICAL, OR OTHER REVISIONS IN THEIR PROPOSALS AS MAY RESULT FROM THE NEGOTIATIONS ***

IT IS A WELL-ESTABLISHED PRINCIPLE IN NEGOTIATED PROCUREMENTS THAT SUCH DISCUSSIONS MUST BE MEANINGFUL AND FURNISH INFORMATION TO ALL OFFERORS WITHIN THE COMPETITIVE RANGE AS TO THE AREAS IN WHICH THEIR PROPOSALS ARE DEFICIENT SO THAT COMPETITIVE OFFERORS ARE GIVEN AN OPPORTUNITY TO FULLY SATISFY THE GOVERNMENT'S REQUIREMENTS. A BASIC PURPOSE OF SUCH PROCUREMENTS IS NOT TO DISCARD INITIAL PROPOSALS, BECAUSE THEY MAY NOT BE FULLY RESPONSIVE TO STATED SPECIFICATIONS, BUT TO DETERMINE WHETHER SUCH DEFICIENT PROPOSALS ARE REASONABLY SUBJECT TO BEING MADE ACCEPTABLE THROUGH DISCUSSIONS.

WE FURTHER NOTE THAT THE RFP SETS OUT, WITH MINOR REVISIONS, THE BRAND NAME OR EQUAL CLAUSE CONTAINED IN ASPR 1-1206.3(B). THIS CLAUSE IS WRITTEN FOR ADVERTISED PROCUREMENTS AND ASPR 1-1206.5 AND 3 501(BCXXV) AUTHORIZE ITS ADAPTATION FOR USE IN NEGOTIATED PROCUREMENTS. HOWEVER, THIS CLAUSE MUST BE SUITABLY MODIFIED FOR USE IN REQUESTS FOR PROPOSALS. THE MERE SUBSTITUTION OF THE WORDS "OFFEROR" FOR "BIDDER" AND "OFFER" FOR "BID" IN THIS CLAUSE LEAVES RESTRICTIONS IN AN RFP WHICH ARE CONTRARY TO THE INTENT AND PURPOSES OF NEGOTIATED PROCUREMENTS. PARAGRAPH (C)(3) OF THE CLAUSE STATES THAT:

MODIFICATIONS PROPOSED AFTER BID OPENING TO MAKE A PRODUCT CONFORM TO A BRAND NAME PRODUCT REFERENCED IN THE INVITATION FOR BIDS WILL NOT BE CONSIDERED.

THE INCLUSION OF A SIMILAR PROVISION IN AN RFP IS INCONSISTENT WITH THE PRINCIPLE OF ALLOWING MODIFICATIONS IN PROPOSALS AS SET OUT IN ASPR 3- 805.1(B).

WE THEREFORE RECOMMEND THAT STEPS BE TAKEN TO INSURE THAT THE PROVISIONS OF ASPR ARE FULLY COMPLIED WITH IN FUTURE PROCUREMENTS IN LIGHT OF OUR COMMENTS ON THIS CASE.

THE FILE FORWARDED WITH THE REPORT TO OUR OFFICE ON AUGUST 16, 1971, BY CHIEF, CONTRACT MANAGEMENT DIVISION, SYSTEMS AND LOGISTICS, IS RETURNED.