B-173712, JAN 7, 1972, 51 COMP GEN 397

B-173712, JAN 7, 1972, 51 COMP GEN 397

CONTRACTS - CONFLICTS OF INTEREST PROHIBITIONS - EXCLUSIONARY CLAUSE ALTHOUGH THE INTERPRETATION OF THE CONFLICT OF INTEREST EXCLUSIONARY CLAUSE IN A REQUEST FOR PROPOSALS FOR MANAGEMENT AND TECHNICAL SERVICES TO DEVELOP A MARINE COMPUTER AIDED OPERATIONAL RESEARCH CENTER THAT "MAJOR INCOME" MEANT 50 PERCENT OF SALES SHOULD HAVE BEEN COMMUNICATED TO ALL OFFERORS BY WRITTEN AMENDMENT AS CONTEMPLATED BY SECTION 1-3.805 1(D) OF THE FEDERAL PROCUREMENT REGULATIONS, THE INTERPRETATION THAT THE 50 PERCENT FIGURE BEST SERVED THE GOVERNMENT'S PURPOSE WAS REASONABLE AND SINCE BOTH THE PROTESTANT AND SUCCESSFUL OFFEROR QUALIFIED UNDER THE 50 PERCENT CRITERION, THE FAILURE TO ISSUE A WRITTEN AMENDMENT DID NOT ADVERSELY AFFECT THE EVALUATION OF THEIR PROPOSALS. CONTRACTS - CONFLICTS OF INTEREST PROHIBITIONS - APPLICABILITY TO FEDERAL PROCUREMENT REGULATIONS IN THE AWARD OF A CONTRACT FOR MANAGEMENT AND TECHNICAL SERVICES TO DEVELOP A MARINE COMPUTER AIDED OPERATIONAL RESEARCH CENTER, THE DEPARTMENT OF COMMERCE PROPERLY DID NOT CONSIDER RULES OF ORGANIZATIONAL CONFLICTS OF INTEREST AS THE PROVISIONS OF ARMED SERVICES PROCUREMENT REGULATION APPENDIX G "RULES FOR THE AVOIDANCE OF ORGANIZATIONAL CONFLICTS OF INTERESTS" DO NOT APPLY TO THE PROCUREMENT, AND THERE ARE NO COMPARABLE ORGANIZATIONAL CONFLICTS OF INTEREST PROVISIONS IN THE FEDERAL PROCUREMENT REGULATIONS. MOREOVER, EVEN IF APPLICABLE APPENDIX G WOULD ONLY PROHIBIT THE SUCCESSFUL CONTRACTOR - A PRODUCER OF MARINE EQUIPMENT WHO WILL GAIN AN UNAVOIDABLE COMPETITIVE ADVANTAGE FROM THE RESEARCH AND DEVELOPMENT EFFORT - FROM PARTICIPATING IN THE COMPETITION FOR A PRODUCTION CONTRACT AND WOULD NOT PRECLUDE THE AWARD OF THE RESEARCH AND DEVELOPMENT CONTRACT. BIDDERS - QUALIFICATIONS - EXPERIENCE - ADMINISTRATIVE DETERMINATION UNDER A REQUEST FOR PROPOSALS THAT REQUIRED THAT "THE BIDDING ORGANIZATION MUST HAVE DEMONSTRATED COMPETENCE AND EXPERIENCE IN DEVELOPING AND IMPLEMENTING COMPLEX COMPUTER AIDED SIMULATION SYSTEMS TOGETHER WITH A WORKING KNOWLEDGE OF COMMERCIAL MARINE OPERATIONS AND AN UNDERSTANDING OF THE POTENTIAL TECHNOLOGICAL ADVANCES AVAILABLE IN CURRENT PRODUCTS AS THEY MAY BE RELATED TO ADVANCED SHIP OPERATIONS," AND ALSO PROVIDED FOR THE EVALUATION OF OFFERS ON THE BASIS OF PRESCRIBED WEIGHTED CRITERIA THAT INCLUDED AN "EXPERIENCE IN SHIP OPERATIONAL SIMULATION SYSTEMS" FACTOR, THE DETERMINATION THAT THE SUCCESSFUL OFFEROR MET THE EXPERIENCE FACTOR REQUIRING A BROAD EXERCISE OF ADMINISTRATIVE JUDGMENT IN A TECHNICAL AREA, THE VALIDITY OF THE DETERMINATION WILL NOT BE QUESTIONED BY THE UNITED STATES GENERAL ACCOUNTING OFFICE. CONTRACTS - NEGOTIATION - EVALUATION FACTORS - CRITERIA THE CONSIDERATION OF EVALUATION FACTORS THAT WERE NOT CONTAINED IN THE REQUESTS FOR PROPOSALS (RFP) FOR MANAGEMENT AND TECHNICAL SERVICES TO DEVELOP A MARINE COMPUTER AIDED OPERATIONAL RESEARCH CENTER BUT WERE DEVELOPED IN DISCUSSIONS WITH OFFERORS WAS PROPER, EVEN THOUGH THE FACTORS ARE NOT EASILY CATEGORIZED UNDER THE RFP CRITERIA, IN VIEW OF THE FACT THE ADDITIONAL FACTORS ARE SUFFICIENTLY CORRELATED TO THE GENERALIZED CRITERIA SHOWN IN THE RFP TO SATISFY THE REQUIREMENT THAT PROSPECTIVE OFFERORS SHOULD BE ADVISED OF THE EVALUATION FACTORS WHICH WILL BE APPLIED TO THEIR PROPOSALS. FURTHERMORE, THE TWO COMPETING OFFERORS RECEIVE THE SAME EVALUATION INFORMATION AND EACH PROPOSAL WAS EVALUATED ACCORDING TO THE SAME CRITERIA. CONTRACTS - AWARDS - PROPRIETY - UPHELD THE UNSUCCESSFUL OFFEROR UNDER A REQUEST FOR PROPOSALS (RFP) TO PROVIDE MANAGEMENT AND TECHNICAL SERVICES TO DEVELOP A MARINE COMPUTER AIDED OPERATIONAL RESEARCH CENTER WAS NOT PREJUDICED BY THE FAILURE OF THE CHAIRMAN OF THE EVALUATION COMMITTEE TO VISIT ITS FACILITY, OR BY THE FACILITY SELECTED FOR THE VISIT IN THE ABSENCE OF ANY LEGAL OR REGULATORY REQUIREMENTS TO THIS EFFECT; NOR BY THE SELECTION OF THE SITE FOR CONTRACT PERFORMANCE SINCE THE SELECTION WAS MADE AFTER AWARD; NOR BY THE FACT THAT THE AWARD OF THE RESEARCH AND DEVELOPMENT CONTRACT WAS MADE ON A FIXED PRICE BASIS AS THE TWO CATEGORIES ARE NOT MUTUALLY EXCLUSIVE - ONE TERM REFERRING TO THE TYPE OF WORK, THE OTHER TO THE TYPE OF CONTRACT TO BE USED; AND, FURTHERMORE, THE SUBSEQUENT AUTHORIZATION OF FUNDS FOR THE PROCUREMENT OF THE HARDWARE AND SOFTWARE UNDER PHASE II OF THE CONTRACT WAS NOT IN CONFLICT WITH THE TERMS OF THE RFP.

TO THE SINGER COMPANY, JANUARY 7, 1972:

WE REFER TO YOUR LETTER DATED JULY 23, 1971, AND SUPPLEMENTAL CORRESPONDENCE PROTESTING THE AWARD OF A CONTRACT TO THE SPERRY SYSTEMS MANAGEMENT DIVISION OF THE SPERRY RAND CORPORATION (SPERRY) UNDER REQUEST FOR PROPOSALS (RFP) NO. 1-35515, ISSUED BY THE UNITED STATES DEPARTMENT OF COMMERCE.

THE SUBJECT RFP ISSUED ON APRIL 15, 1971, SOLICITED PROPOSALS FROM SEVEN FIRMS AND TWO EDUCATIONAL INSTITUTIONS FOR MANAGEMENT AND TECHNICAL SERVICES FOR THE DEVELOPMENT OF A MARINE COMPUTER AIDED OPERATIONAL RESEARCH CENTER. THE CENTER'S PRIMARY FUNCTION WILL BE TO RESEARCH ACCIDENTS AT SEA AND RECOMMENDED IMPROVEMENTS FOR ADVANCED NAVIGATION AND CONTROL EQUIPMENT. THE CENTER WILL UTILIZE RESEARCH AND DEVELOPMENT CAPABILITY, AUTOMATION TECHNOLOGY AND SIMULATION.

SEVEN PROPOSALS WERE RECEIVED BY MAY 17, 1971, THE SCHEDULED CLOSING DATE. THE EVALUATION COMMITTEE FOUND THAT THE PROPOSAL SUBMITTED BY YOUR FIRM AND THAT SUBMITTED BY SPERRY WERE SUBSTANTIALLY SUPERIOR TO THE OTHERS AND A FURTHER REVIEW OF THEM WAS PROPOSED, INCLUDING VISITS TO BOTH FIRM'S FACILITIES. ON JUNE 17, 1971, THE COMMITTEE SELECTED THE SPERRY PROPOSAL AS MOST ADVANTAGEOUS TO THE GOVERNMENT AND NEGOTIATIONS WERE UNDERTAKEN WITH THAT FIRM RESULTING IN AN AWARD TO SPERRY ON JUNE 23, 1971.

INITIALLY, YOU CONTEND THAT THE AWARD TO SPERRY IS CONTRARY TO THE TERMS OF THE RFP BECAUSE 47 PERCENT OF ITS SALES AND 40.7 PERCENT OF ITS INCOME IN THE YEARS 1970-1971 RESULTED FROM THE SALE OF AUTOMATIC DATA PROCESSING EQUIPMENT (ADP).

SECTION IV OF THE RFP CONTAINED THE FOLLOWING PROVISIONS:

DUE TO THE CONFLICTS OF INTEREST WHICH ARE INHERENT IN THE PROGRAM CONTEMPLATED, THE FOLLOWING TYPES OF FIRMS WILL NOT BE CONSIDERED FOR AWARD OF ANY CONTRACT THAT MAY RESULT FROM THIS REQUEST FOR PROPOSAL:

(A) FIRMS WHOSE MAJOR INCOME IS DERIVED FROM THE DESIGN, DEVELOPMENT, MANUFACTURE, SALE OR RENTAL OF AUTOMATIC DATA PROCESSING EQUIPMENT.

(B) FIRMS WHO DERIVE SIGNIFICANT REVENUE FROM THE SALE OF PROCESSING TIME ON AUTOMATIC DATA PROCESSING EQUIPMENT.

THE ACTIVITY INFORMS US THAT THESE CLAUSES WERE ADMINISTERED IN THE FOLLOWING MANNER:

ON APRIL 17, 1971, SPERRY ORALLY REQUESTED CLARIFICATION FROM THE PROCUREMENT DIVISION AS TO WHETHER 40% SALES WAS CONSIDERED "MAJOR" UNDER THE EXCLUSIONARY CLAUSE OF THE RFP. BY LETTER OF THE SAME DATE, THE GENERAL ELECTRIC COMPANY ALSO SOUGHT A FORMAL DETERMINATION AS TO WHETHER A PROPOSAL SUBMITTED BY THAT COMPANY WOULD BE CONSIDERED. BOTH THESE FIRMS WERE ADVISED THAT "MAJOR" MEANT "MAJORITY OF THEIR SALES OR 50%.

YOUR FIRM TAKES EXCEPTION TO THE ABOVE-CITED INTERPRETATION OF THE CLAUSE. YOU CONTEND THAT THERE IS NO RATIONAL BASIS FOR THE SELECTION OF THE 50 PERCENT FIGURE AND THAT ITS USE NECESSITATED THE ISSUANCE OF A WRITTEN AMENDMENT TO THE RFP.

WE HAVE BEEN INFORMED BY THE ACTIVITY THAT THE INTENT OF THESE CLAUSES WAS TO EXCLUDE LARGE COMPUTER FIRMS WHILE AT THE SAME TIME TO INCLUDE FIRMS WITH SOME COMPUTER EXPERIENCE. THE AGENCY DECIDED THAT THE 50 PERCENT FIGURE WOULD BEST SERVE THEIR PURPOSE AND WE HAVE NO BASIS UPON WHICH WE MAY DISPUTE THEIR DETERMINATION. WE AGREE THAT THE NOTIFICATION TO SPERRY AND GE CONCERNING THE 50 PERCENT INTERPRETATION OF "MAJOR INCOME" SHOULD HAVE BEEN COMMUNICATED TO ALL OFFERORS BY WRITTEN AMENDMENT, AS CONTEMPLATED BY FEDERAL PROCUREMENT REGULATION (FPR) 1-3.805 -1(D). HOWEVER, WE FIND NOTHING UNREASONABLE IN THE INTERPRETATION. FURTHER, SINCE BOTH YOUR FIRM AND SPERRY QUALIFIED UNDER THE 50 PERCENT CRITERION, THE FAILURE TO ISSUE A WRITTEN AMENDMENT DID NOT ADVERSELY AFFECT THE EVALUATION OF YOUR PROPOSAL.

NEXT YOU CONTEND THAT "THE AWARD TO SPERRY IS IN CONFLICT WITH GENERALLY ACCEPTED RULES OF ORGANIZATIONAL CONFLICTS OF INTEREST." THIS PREMISE IS PRIMARILY BASED UPON THE FACT THAT SPERRY IS MANUFACTURER AND SUPPLIER OF MARINE EQUIPMENT. SINCE THE CONTRACT REQUIRES THAT SPERRY EVALUATE MARINE HARDWARE SYSTEMS AND ANALYZE INFORMATION IN REGARD TO THE LATEST DEVELOPMENTS IN THE MARINE HARDWARE INDUSTRY YOU CONCLUDE THAT SPERRY'S CONFLICTING ROLES AS MANUFACTURER AND EVALUATOR MIGHT BIAS ITS JUDGMENT AND CREATE AN UNFAIR COMPETITIVE ADVANTAGE. IN SUPPORT OF YOUR POSITION, YOU REFER TO THE PROVISIONS OF ARMED SERVICES PROCUREMENT REGULATION APPENDIX G "RULES FOR THE AVOIDANCE OF ORGANIZATIONAL CONFLICTS OF INTEREST." THE DEPARTMENT OF COMMERCE IS NOT SUBJECT TO THE ARMED SERVICES PROCUREMENT REGULATION (ASPR), AND THERE ARE NO COMPARABLE REGULATIONS ON ORGANIZATIONAL CONFLICT OF INTEREST IN THE FPR. EVEN IF APPENDIX G WERE APPLICABLE TO THE INSTANT CASE, ITS PROVISIONS WOULD NOT INVALIDATE THE AWARD, BUT MERELY LIMIT, BY MEANS OF A CLAUSE IN THE CONTRACT, SPERRY'S PARTICIPATION IN FOLLOW-ON PROCUREMENTS. THIS OFFICE HAS HELD THAT APPENDIX G SEEKS TO PRECLUDE THE INVOLVEMENT OF A RESEARCH AND DEVELOPMENT CONTRACTOR IN THE FOLLOW-ON PROCUREMENT OF THE TANGIBLE RESULTS OR EQUIPMENTS, ETC., FLOWING FROM THE RESEARCH AND DEVELOPMENT EFFORT. THUS, THE ASPR APPROACH TO POTENTIAL ORGANIZATIONAL CONFLICT OF INTERESTS IS NOT TO PRECLUDE THE PARTICIPATION OF CURRENT PRODUCERS OF EQUIPMENT IN A RESEARCH AND DEVELOPMENT PROCUREMENT SUBSTANTIALLY INVOLVING SIMILAR EQUIPMENT, BUT TO PROHIBIT THE SUCCESSFUL CONTRACTOR IN THE RESEARCH AND DEVELOPMENT EFFORT - WHO HAS GAINED AN UNAVOIDABLE COMPETITIVE ADVANTAGE - FROM PARTICIPATING IN THE COMPETITION FOR A PRODUCTION CONTRACT. SEE B-162501, DECEMBER 29, 1967.

IN VIEW OF THE FOREGOING, WE MUST CONCLUDE THAT THE QUESTION OF SPERRY'S ELIGIBILITY UNDER THE SUBJECT CONTRACT IS A MATTER OF JUDGMENT WITHIN THE COGNIZANCE OF THE PROCUREMENT AGENCY. ALTHOUGH YOU OFFER SEVERAL ARGUMENTS TO THE EFFECT THAT SPERRY WILL NOT BE ABLE TO PERFORM THIS CONTRACT IN AN UNBIASED MANNER WE CANNOT CONSIDER THIS A SUFFICIENT BASIS UPON WHICH TO QUESTION THE JUDGMENT OF THE AGENCY IN THIS CASE.

YOU ALSO CONTEND THAT THE AWARD WAS CONTRARY TO THE TERMS OF THE RFP IN THAT SPERRY LACKS ANY EXPERIENCE IN SHIP OPERATIONAL SIMULATION SYSTEMS AND TECHNIQUES. THE SUBJECT RFP REQUIRES THAT "THE BIDDING ORGANIZATION MUST HAVE DEMONSTRATED COMPETENCE AND EXPERIENCE IN DEVELOPING AND IMPLEMENTING COMPLEX COMPUTER AIDED SIMULATION SYSTEMS TOGETHER WITH A WORKING KNOWLEDGE OF COMMERCIAL MARINE OPERATIONS AND AN UNDERSTANDING OF THE POTENTIAL TECHNOLOGICAL ADVANCES AVAILABLE IN CURRENT PRODUCTS AS THEY MAY BE RELATED TO ADVANCED SHIP OPERATIONS." IN ADDITION, THE RFP PROVIDES THAT PROPOSALS WOULD BE EVALUATED ACCORDING TO THE FOLLOWING WEIGHTED CRITERIA:

1. UNDERSTANDING OF THE PROBLEM 25

2. EXPERIENCE IN SHIP OPERATIONAL SIMULATION SYSTEMS 20

3. APPROACH TO THE PROBLEM 25

4. QUALITY OF PERSONNEL 20

5. ADMINISTRATIVE ABILITY 10

YOU PRESENT EVIDENCE TO THE EFFECT THAT YOUR FIRM POSSESSES SUPERIOR EXPERIENCE IN THE FIELD OF COMPUTER AIDED SIMULATION SYSTEMS AND SHIP OPERATIONAL SIMULATION. BASED ON THE ABOVE YOU CONCLUDE THAT IT IS DOUBTFUL THAT SPERRY MEETS THE EXPERIENCE REQUIREMENT AND SHOULD HAVE RECEIVED A LOW SCORE UNDER EVALUATION FACTOR NO. 2.

IN RESPONSE TO THIS ALLEGATION THE ACTIVITY STATES AS FOLLOWS:

*** RECOGNIZING THE LIMITED ABILITY OF THE MEMBERSHIP TO ASSESS SIMULATOR CAPABILITIES, THE MINUTES OF THE FIRST MEETING OF THE COMMITTEE RECITED THAT:

"SUBSEQUENT TO THIS MEETING, MR. ROGER WINBLADE OF NASA, OFFICE OF ADVANCED TECHNOLOGY, WAS ASSIGNED BY NASA HEADQUARTERS TO ASSIST IN A TECHNOLOGICAL EVALUATION OF THE SIMULATION ASPECTS OF THE PROPOSALS. HIS EXTENSIVE BACKGROUND IN NASA SIMULATION TECHNIQUES IS CONSIDERED INVALUABLE IN THIS REVIEW OF PROPOSED SIMULATION SYSTEMS AND TECHNIQUES. COPIES OF ALL PROPOSALS WERE FORWARDED TO MR. WINBLADE FOR HIS STUDY AND COMMENTS."

UPON REVIEW OF THE SIMULATION ASPECTS OF EACH PROPOSAL, MR. WINBLADE ADVISED THE COMMITTEE BY MEMORANDUM OF JUNE 2, 1971, THAT:

"SINCE EACH PROPOSER HAS EXTENSIVE EXPERIENCE IN COMPUTER APPLICATION, OR HAS A TEAM MEMBER WITH THIS CAPABILITY, THIS EVALUATION IS BASED PRIMARILY ON THE MAN-MACHINE INTERFACE AND THE VISUAL DISPLAY ... "

HAVING SET FORTH THE FIVE AREAS OF CONSIDERATION MR. WINBLADE RANKED SINGER AND SPERRY FIRST AND SECOND, AND WENT ON TO NOTE THAT:

"NUMBERS ONE (SINGER) AND TWO (SPERRY) ARE CONSIDERED EQUAL ... IN GENERAL, THE FIRST TWO CHOICES (SINGER AND SPERRY) HAVE EXTENSIVE EXPERIENCE IN THE MANNED SIMULATION AREA, AND HAVE PROPOSED AN EXCELLENT TEAM FOR THIS EFFORT ... "

BASED UPON MR. WINBLADE'S EVALUATION IT IS INDEED DIFFICULT TO ACCEPT AS FACTUAL, SINGER'S ALLEGATION THAT SPERRY "LACKS EXPERIENCE IN SHIP OPERATIONAL SIMULATION" AND "THUS SHOULD HAVE RECEIVED A VERY LOW RATING

YOU ATTACK THE VALIDITY OF THE AGENCY'S RESPONSE BY ARGUING THAT MR. WINBLADE IGNORED THE REQUIREMENT CRITERION AND EVALUATION FACTOR NO. 2 BY ESTABLISHING "MAN-MACHINE INTERFACE" AS A PRIMARY CONSIDERATION. SUCH A DETERMINATION REQUIRES A BROAD EXERCISE OF JUDGMENT IN A TECHNICAL AREA. THEREFORE, WE ARE NOT PREPARED TO QUESTION THE VALIDITY OF THE ACTIVITY'S CONCLUSION IN THIS MATTER.

NEXT, YOU QUESTION THE VALIDITY OF THE SUBJECT AWARD BASED ON THE ALLEGATION THAT FACTORS NOT LISTED AS EVALUATION CRITERIA IN THE RFP WERE CONSIDERED BY THE EVALUATION COMMITTEE. THE ADMINISTRATIVE REPORT STATES IN THIS REGARD AS FOLLOWS:

SINGER'S REFERENCE TO EVALUATION FACTORS NOT SET FORTH IN THE RFP IS THE RESULT OF VARIOUS DISCUSSIONS BETWEEN THE STAFF OF THE MARITIME ADMINISTRATION AND SINGER AFTER CONTRACT AWARD. DURING THE DISCUSSIONS THE STAFF ATTEMPTED TO DISCLOSE TO SINGER'S REPRESENTATIVES THE NUMEROUS ACTIONS TAKEN IN THE EVALUATION PROCESS AND THE ULTIMATE SELECTION OF SPERRY. SINGER WAS ORALLY ADVISED THAT THE CRITERIA AND WEIGHTED FACTORS AS SET FORTH ON PAGE 50 OF THE RFP WERE THE ONLY FACTORS CONSIDERED BY THE PROPOSAL EVALUATION COMMITTEE IN ESTABLISHING THE RELATIVE STANDINGS OF ALL PROPOSALS RECEIVED. BASED ON THESE CRITERIA, SPERRY WAS RATED AT 85.7 OUT OF A POSSIBLE 100 AND SINGER 83.2. OTHER PROPOSALS RANGED TO A LOW OF 54.0. THIS DETERMINATION WAS MADE AT THE CONCLUSION OF THE SECOND MEETING ON JUNE 3, 1971. HOWEVER, THE COMMITTEE MEMBERS FELT THAT SINCE THE SINGER AND SPERRY PROPOSALS WERE BOTH EXCELLENT AND SO CLOSE IN SCORING, A MEETING SHOULD BE HELD WITH BOTH SPERRY AND SINGER REPRESENTATIVES TO FURTHER DEFINE POINTS IN QUESTION AND THAT A VISIT TO THE SINGER AND SPERRY FACILITIES SHOULD BE SCHEDULED. MEETINGS WERE HELD ON JUNE 10, 1971 AT THE MARITIME ADMINISTRATION, AND IT WAS CONCLUDED THAT OTHER SUPPLEMENTAL CONSIDERATIONS SHOULD BE EVALUATED AS THE PROPOSALS RELATED TO THE PROGRAM. BASED ON THE RESULTS OF THE MEETINGS AND DISCUSSIONS BY THE COMMITTEE, A TABULAR SHEET OF NON-WEIGHTED CONSIDERATIONS WAS DEVELOPED THAT RELATED TO THE SINGER AND SPERRY PROPOSALS AS SUPPLEMENTED BY THE DISCUSSIONS HELD WITH THEIR RESPECTIVE REPRESENTATIVES. THESE INFORMAL CONSIDERATIONS FURTHER SUPPORTED THE SELECTION OF SPERRY ABOVE AND BEYOND THE CRITERIA AND WEIGHTED FACTORS REFERRED TO IN THE PREVIOUS COMMITTEE'S SELECTION OF SPERRY.

THE COMMITTEE CONSIDERED THE FOLLOWING ADDITIONAL FACTORS IN THE FINAL STAGE OF EVALUATION:

1. TIME AND EFFORT ALREADY EXPENDED ON THIS PROPOSAL AS EVIDENCED BY PROPOSAL. (HOMEWORK)

2. EXPERIENCE IN PREVIOUS SIMULATION PROJECTS. (RECORD)

3. EXPERIENCE IN MARINE EQUIPMENT AND MARINE ENVIRONMENT.

4. SUBCONTRACTOR EXPERIENCE AND COMPETENCE.

5. MANPOWER LOADING. (MORE ASSIGNED)

6. PROBABILITY OF MEETING SCHEDULE. SPERRY EVIDENCED DOUBT. SINGER SEEMS NOT TO APPRECIATE DIFFICULTY OF THIS PROBLEM SPECIFICALLY WITH REGARD TO BUILDING MODIFICATION LEAD TIME.

7. LOCATION - HOME OFFICE VS PRIME SITE.

8. LOCATION - HOME OFFICE VS D.C.

9. ENTREE INTO COMMERCIAL MARINE WORLD (INDUSTRY IMAGE EXCELLENT).

10. PROGRAM PRESENTATION AS IN PROPOSAL.

11. IN HOUSE EXPERTISE WITH REGARD TO SHIPS MOTION EQUATIONS, STABILITY, TRIM, STEERING, ETC.

12. RECOGNITION OF THE VALIDATION OF SUB CONTRACTORS PERSONNEL ASSIGNMENTS.

13. INCLUSION OF ARCHITECTURAL CONSULTANT RECOGNITION OF NEED FOR BUILDING MODIFICATION STUDY.

14. EVALUATIONS OF SIMULATION WORK AS OBSERVED IN PLANT VISITS.

15. STRONG LINK TO LABOR GROUPS THRU MAJOR PREVIOUS COMMERCIAL MARINE SIMULATION PROJECT.

16. PHASE II IN HOUSE MANPOWER SELECTION. (NEED FOR NUMBER OF PERSONNEL OF TYPE INDICATED BY SINGER NOT APPRECIATED).

17. TENTATIVE OR FIRST CUT SELECTION OF HARDWARE FOR PHASE III AS IT IMPLIES SPERRY MAY BE LOOKED IN TO A PROGRAM HAS NEGATIVE IMPLICATIONS. AS IT IMPLIES SPERRY HAS MOVED ALONG ON THE PROJECT, AND INTENDS TO USE THIS ONLY AS A BASE LINE TO BE MODIFIED THRU FURTHER STUDY, IT IS A STRONG PLUS.

18. INTENTIONS TO INVOLVE THE TOTAL INDUSTRY.

19. FAMILIARITY WITH PRIME SITE.

20. UNDERSTANDING OF OBJECTIVES AND GOALS. ALTHOUGH THESE ADDITIONAL CRITERIA MAY NOT BE EASILY CATEGORIZED UNDER THE FIVE CRITERIA SET FORTH IN THE RFP, WE BELIEVE THERE IS SUFFICIENT CORRELATION BETWEEN THE ADDITIONAL EVALUATION FACTORS USED AND THE GENERALIZED CRITERIA SHOWN IN THE RFP TO SATISFY THE REQUIREMENT THAT PROSPECTIVE OFFERORS BE ADVISED OF THE EVALUATION CRITERIA WHICH WILL BE APPLIED TO THEIR PROPOSALS. SEE 50 COMP. GEN. 565, 574 (1971). IN ADDITION, BOTH OFFERORS RECEIVED THE SAME EVALUATION INFORMATION AND EACH PROPOSAL WAS EVALUATED ACCORDING TO THE SAME CRITERIA. IT IS ALSO RELEVANT THAT UTILIZATION OF THESE ADDITIONAL CRITERIA DID NOT RESULT IN A CHANGE IN THE RANKING OF THE TWO OFFERORS. IN VIEW OF THE ABOVE CITED FACTORS WE CANNOT SAY THAT THIS SECOND EVALUATION WAS UNFAIR OR UNREASONABLE.

YOU FURTHER CONTEND THAT THE AGENCY VIOLATED GOOD PROCUREMENT PRACTICE BY NOT VISITING CERTAIN OF YOUR FACILITIES AND BY THE ABSENCE OF THE CHAIRMAN OF THE COMMITTEE FROM THE ONE FACILITY VISITED. IT IS REPORTED THAT THE CHAIRMAN HAD PREVIOUSLY VISITED THIS SITE IN LATE 1970. IN ANY EVENT, WE ARE NOT AWARE OF ANY LEGAL OR REGULATORY REQUIREMENT THAT ALL MEMBERS OF AN EVALUATION COMMITTEE MUST BE PRESENT ON SUCH VISITS. LIKEWISE WE ARE NOT PREPARED TO QUESTION THE ACTIVITY'S DETERMINATION AS TO WHICH OF YOUR FACILITIES SHOULD BE VISITED.

YOU FURTHER CONTEND THAT YOUR FIRM WAS PREJUDICED BY THE FACT THAT THE AGENCY HAD CHOSEN A SITE FOR THE PROPOSED FACILITY BEFORE THE CONTRACT HAD BEEN AWARDED, WHEREAS THE RFP INDICATES THAT SEVERAL LOCATIONS WERE BEING CONSIDERED. IN THIS REGARD WE HAVE BEEN INFORMALLY ADVISED BY THE ACTIVITY THAT THE KINGS POINT LOCATION WAS NOT FORMALLY DESIGNATED AS THE SITE FOR THE PROJECT UNTIL LATE IN SEPTEMBER, 1971, OR AFTER THE SUBJECT CONTRACT WAS AWARDED TO SPERRY.

YOU ALSO ALLEGE THAT THE INTENT OF THE RFP WAS CHANGED BECAUSE OF THE AWARD OF A RESEARCH AND DEVELOPMENT CONTRACT WHEREAS THE RFP ANTICIPATED A FIXED-PRICE CONTRACT. THE TWO CATEGORIES ARE NOT MUTUALLY EXCLUSIVE. THE TERM "RESEARCH AND DEVELOPMENT" MERELY REFERS TO THE TYPE OF WORK TO BE PERFORMED UNDER THE CONTRACT WHILE THE TERM "FIXED-PRICE" REFERS TO THE TYPE OF CONTRACT TO BE USED. THERE IS NO RULE WHICH PRECLUDES THE AGENCY FROM AWARDING A CONTRACT FOR RESEARCH AND DEVELOPMENT WORK ON A FIXED- PRICE BASIS.

FINALLY, YOU ALLEGE AN IMPROPRIETY IN THE AUTHORIZATION OF AN ADDITIONAL $3,000,000 FOR PROCUREMENT OF ITEMS NECESSARY FOR THE PERFORMANCE OF THIS CONTRACT. IT IS CLEAR FROM THE RFP THAT PHASE II OF THE PROGRAM WOULD INVOLVE THE PROCUREMENT OF HARDWARE AND SOFTWARE ITEMS BY THE PRIME CONTRACTOR ON BEHALF OF THE AGENCY. THEREFORE, IT IS EVIDENT THAT THE FUNDING OF SUCH ACTIVITY IS NOT IN CONFLICT WITH THE TERMS OF THE RFP.

SINCE WE CAN FIND NO BASIS UPON WHICH TO QUESTION THE LEGAL SUFFICIENCY OF THE AWARD, YOUR PROTEST MUST BE DENIED.