B-173740(1), NOV 17, 1971

B-173740(1): Nov 17, 1971

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ASPR 2-404.1(B)(I) PROVIDES THAT AN INVITATION MAY BE CANCELLED AFTER OPENING BUT BEFORE AWARD WHEN INADEQUATE SPECIFICATIONS WERE CITED IN THE INVITATION. SUCH A DETERMINATION IS WITHIN THE DISCRETION OF THE ADMINISTRATIVE AGENCY AND WILL NOT BE DISTURBED BY GAO IN THE ABSENCE OF CLEAR PROOF OF ABUSE OF DISCRETION. FAILURE TO NOTIFY BIDDERS OF THE REASON FOR CANCELLATION IS A PROCEDURAL VIOLATION OF ASPR 2-404.3 WHICH DOES NOT AFFECT THE VALIDITY OF THE CANCELLATION. WE HAVE REQUESTED AND RECEIVED A REPORT ON THIS MATTER FROM THE NAVAL SUPPLY SYSTEMS COMMAND. WHICH SHOWS THAT THE INVITATION WAS ISSUED ON APRIL 29. WAS RECEIVED BY THE PROCURING AGENCY. WAS CONSIDERED SUFFICIENTLY SIMILAR TO WARRANT AMENDMENT OF THE ORIGINAL INVITATION AS AN APPROPRIATE MEANS OF OBTAINING SUFFICIENT COMPETITION.

B-173740(1), NOV 17, 1971

BID PROTEST - INADEQUATE SPECIFICATIONS - NOTIFICATION OF CANCELLATION DENIAL OF PROTEST AGAINST A PARTIAL AWARD, AND CANCELLATION OF ANOTHER PORTION, UNDER AN IFB ISSUED BY THE U.S. NAVY PURCHASING OFFICE, LOS ANGELES, CAL., FOR PROCUREMENT OF TWO CIRCUIT ANALYZERS, ONE EACH FOR THE NAVAL AIR REWORK FACILITY AT NORTH ISLAND, CAL., AND JACKSONVILLE, FLA. ASPR 2-404.1(B)(I) PROVIDES THAT AN INVITATION MAY BE CANCELLED AFTER OPENING BUT BEFORE AWARD WHEN INADEQUATE SPECIFICATIONS WERE CITED IN THE INVITATION. SUCH A DETERMINATION IS WITHIN THE DISCRETION OF THE ADMINISTRATIVE AGENCY AND WILL NOT BE DISTURBED BY GAO IN THE ABSENCE OF CLEAR PROOF OF ABUSE OF DISCRETION. THAT SHOWING HAS NOT BEEN MADE HERE. FAILURE TO NOTIFY BIDDERS OF THE REASON FOR CANCELLATION IS A PROCEDURAL VIOLATION OF ASPR 2-404.3 WHICH DOES NOT AFFECT THE VALIDITY OF THE CANCELLATION.

TO ELECTRONIC SYSTEMS AND PROGRAMMING, INC.:

WE REFER TO YOUR LETTER OF JULY 26, 1971, DIRECTED TO THE REGIONAL MANAGER, GENERAL ACCOUNTING OFFICE, LOS ANGELES, CALIFORNIA, WHICH PROTESTS A PARTIAL AWARD, AND CANCELLATION OF ANOTHER PORTION, OF INVITATION FOR BID N00123-71-B-1696, ISSUED BY THE U.S. NAVY PURCHASING OFFICE, LOS ANGELES, CALIFORNIA.

WE HAVE REQUESTED AND RECEIVED A REPORT ON THIS MATTER FROM THE NAVAL SUPPLY SYSTEMS COMMAND, DEPARTMENT OF THE NAVY, WHICH SHOWS THAT THE INVITATION WAS ISSUED ON APRIL 29, 1971, FOR PROCUREMENT OF ONE CIRCUIT ANALYZER FOR USE AT THE NAVAL AIR REWORK FACILITY, NORTH ISLAND, CALIFORNIA. ON MAY 3, 1971, A REQUISITION FOR AN ADDITIONAL CIRCUIT ANALYZER FOR USE AT THE NAVAL AIR REWORK FACILITY, JACKSONVILLE, FLORIDA, WAS RECEIVED BY THE PROCURING AGENCY. THE SECOND UNIT DIFFERED SOMEWHAT FROM THE FIRST IN MATTERS OF CAPACITY, BUT WAS CONSIDERED SUFFICIENTLY SIMILAR TO WARRANT AMENDMENT OF THE ORIGINAL INVITATION AS AN APPROPRIATE MEANS OF OBTAINING SUFFICIENT COMPETITION. THE INVITATION WAS THEREFORE AMENDED TO INCLUDE THE REQUIREMENT FOR THE SECOND CIRCUIT ANALYZER AND TO MAKE THE REQUIRED CHANGES IN THE SPECIFICATIONS. BID OPENING WAS EXTENDED TO MAY 27, 1971.

BIDS WERE RECEIVED AND OPENED FROM YOUR FIRM AND FROM DIT-MCO. YOUR BID WAS LOW FOR THE CIRCUIT ANALYZER FOR JACKSONVILLE WHILE DIT-MCO'S BID WAS LOW FOR THE SYSTEM FOR NORTH ISLAND. THE INVITATION PROVIDED FOR A SPLIT AWARD, AND DIT-MCO WAS AWARDED THE CONTRACT FOR THE NORTH ISLAND SYSTEM. A PRE-AWARD SURVEY WAS REQUESTED ON YOUR FIRM, THE RESULTS OF WHICH WERE AFFIRMATIVE IN ALL RESPECTS.

HOWEVER, BEFORE AWARD, JACKSONVILLE REQUESTED CANCELLATION OF THAT PORTION OF THE INVITATION RELATING TO THE CIRCUIT ANALYZER FOR ITS USE DUE TO THE FACT THAT THE INVITATION DID NOT INCLUDE REQUIREMENTS FOR AC DIELECTRIC TEST CAPABILITY AND AN AC DIGITAL VOLTMETER. THE NAVAL AIR SYSTEMS COMMAND HEADQUARTERS CONCURRED WITH THIS REQUEST, TRANSFERRED FUNDS FROM NORTH ISLAND TO JACKSONVILLE FOR THE PROCUREMENT, AND DIRECTED NORTH ISLAND TO CANCEL THE PROCUREMENT FOR JACKSONVILLE SINCE FUNDS WERE NO LONGER AVAILABLE AT NORTH ISLAND TO COMPLETE THE PROCUREMENT. SUBSEQUENT PROCUREMENT TO FULFILL THE JACKSONVILLE REQUIREMENT, IF UNDERTAKEN, WILL BE HANDLED BY THE NAVY PURCHASING OFFICE, WASHINGTON, D.C.

ASPR 2-404.1(B)(I) PROVIDES THAT AN INVITATION MAY BE CANCELLED AFTER OPENING BUT BEFORE AWARD WHEN INADEQUATE SPECIFICATIONS WERE CITED IN THE INVITATION. IN CONSTRUING THIS PROVISION, WE HAVE HELD THAT THE DETERMINATION OF WHETHER A REASON EXISTS FOR CANCELLATION IS A MATTER PRIMARILY WITHIN THE DISCRETION OF THE ADMINISTRATIVE AGENCY AND WILL NOT BE DISTURBED IN THE ABSENCE OF CLEAR PROOF OF ABUSE OF DISCRETION. COMP. GEN. 50 (1970); 47 ID. 103 (1967).

IN THE PRESENT CASE, THE OMISSION OF REQUIREMENTS FOR AC DIELECTRIC TEST CAPABILITY AND AN AC DIGITAL VOLTMETER FROM THE SPECIFICATIONS WOULD APPEAR TO CONSTITUTE A COMPELLING REASON FOR THE CANCELLATION OF THAT PORTION OF THE INVITATION RELATING TO THE CIRCUIT ANALYZER FOR USE AT JACKSONVILLE. SINCE THE INVITATION PROVIDED FOR A SPLIT AWARD AND THERE WERE NO DEFICIENCIES NOTED IN THE SPECIFICATIONS FOR THE SYSTEM DESTINED FOR USE AT NORTH ISLAND, WE FIND NO ABUSE OF DISCRETION IN THE DECISION TO MAKE AWARD TO DIT-MCO, THE LOW BIDDER ON THAT SYSTEM, AND TO CANCEL THE PROCUREMENT OF THE SYSTEM FOR JACKSONVILLE.

WE NOTE, HOWEVER, THAT THERE IS NOTHING IN THE REPORT FROM THE NAVY OR IN YOUR LETTER OF PROTEST TO INDICATE THAT YOU WERE EVER ADVISED OF THE REASONS FOR THE CANCELLATION. ASPR 2-404.3 PROVIDES THAT WHEN A CONTRACTING OFFICER DETERMINES TO REJECT ALL BIDS, HE SHALL NOTIFY EACH BIDDER THAT ALL BIDS HAVE BEEN REJECTED AND STATE THE REASON FOR SUCH ACTION. WHILE WE REGARD THIS OMISSION AS A PROCEDURAL MATTER NOT AFFECTING THE SUBSTANTIVE VALIDITY OF THE CANCELLATION, WE THINK IT IS REGRETTABLE THAT YOU WERE NOT ADVISED OF THE REASON FOR THE ACTION. ACCORDINGLY, WE ARE BRINGING THIS MATTER TO THE ATTENTION OF THE SECRETARY OF THE NAVY FOR SUCH CORRECTIVE ACTION AS MAY BE WARRANTED TO AVOID A RECURRENCE OF THIS SITUATION.

FOR THE REASONS STATED, YOUR PROTEST IS DENIED.