B-174056, JUN 1, 1972

B-174056: Jun 1, 1972

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THE COMPARISON OF PROTESTANT'S BID WITH OTHER PROPOSALS WAS A PROPER METHOD OF DETERMINING THAT NEGOTIATIONS WERE NOT REQUIRED. BECAUSE TIA WAS NOT WITHIN THE COMPETITIVE RANGE. THE AGENCY WAS UNDER NO OBLIGATION TO PROVIDE SPECIFIC TECHNICAL HELP IN MAKING THE OFFER ACCEPTABLE. IS UNABLE TO CONCLUDE THAT NAVY'S DECISION WAS ARBITRARY OR CAPRICIOUS. THE PROTEST IS DENIED. INCORPORATED: REFERENCE IS MADE TO THE TELEGRAM OF SEPTEMBER 8. THE METHOD OF ACHIEVING THE VARIOUS PERFORMANCE CHARACTERISTICS DESCRIBED IN THESE DOCUMENTS WAS LEFT TO THE PROSPECTIVE CONTRACTORS. OFFERORS WERE ADVISED THAT PROPOSALS WERE TO DEMONSTRATE THEIR UNDERSTANDING OF WHAT WAS REQUIRED BY THE SPECIFICATION DOCUMENTS.

B-174056, JUN 1, 1972

BID PROTEST - ALLEGED IMPROPER DETERMINATION OF COMPETITIVE RANGE DECISION DENYING THE PROTEST OF TECHNICAL INDUSTRIAL ASSOCIATES, INC. (TIA), AGAINST REJECTION OF ITS UNSOLICITED PROPOSAL UNDER A SMALL BUSINESS SET-ASIDE ISSUED BY THE NAVY ELECTRONIC SYSTEMS COMMAND, WASHINGTON, D.C. THE COMPARISON OF PROTESTANT'S BID WITH OTHER PROPOSALS WAS A PROPER METHOD OF DETERMINING THAT NEGOTIATIONS WERE NOT REQUIRED, PURSUANT TO ASPR 3-805.1, BECAUSE TIA WAS NOT WITHIN THE COMPETITIVE RANGE. FURTHER, THE AGENCY WAS UNDER NO OBLIGATION TO PROVIDE SPECIFIC TECHNICAL HELP IN MAKING THE OFFER ACCEPTABLE. IN VIEW OF THE MATERIAL DEFECTS IN THE PROPOSAL, THE COMP. GEN. IS UNABLE TO CONCLUDE THAT NAVY'S DECISION WAS ARBITRARY OR CAPRICIOUS. ACCORDINGLY, THE PROTEST IS DENIED.

TO TECHNICAL INDUSTRIAL ASSOCIATES, INCORPORATED:

REFERENCE IS MADE TO THE TELEGRAM OF SEPTEMBER 8, 1971, AND SUBSEQUENT CORRESPONDENCE PROTESTING AGAINST THE REJECTION OF YOUR PROPOSAL IN RESPONSE TO SOLICITATION NO. N00039-71-R-0142(S), A TOTAL SMALL BUSINESS SET-ASIDE ISSUED ON JUNE 11, 1971, BY THE NAVAL ELECTRONIC SYSTEMS COMMAND, WASHINGTON, D.C; FOR TWO MODIFIED COMMUNICATION AND CONTROL CONSOLE GROUP SYSTEMS PLUS DATA AND SPARE PARTS UNDER ITEM 0001 AND AN OPTION FOR ANOTHER MODIFIED SYSTEM UNDER ITEM 0002.

SECTION F ON PAGE 28, LISTED THE SPECIFICATION DOCUMENTS. THE METHOD OF ACHIEVING THE VARIOUS PERFORMANCE CHARACTERISTICS DESCRIBED IN THESE DOCUMENTS WAS LEFT TO THE PROSPECTIVE CONTRACTORS. OFFERORS WERE ADVISED THAT PROPOSALS WERE TO DEMONSTRATE THEIR UNDERSTANDING OF WHAT WAS REQUIRED BY THE SPECIFICATION DOCUMENTS.

OFFERS WERE INITIALLY SOLICITED ONLY FROM VIRGINIA ELECTRONICS COMPANY, INCORPORATED (VELCO) AND DENRO LABORATORIES, INCORPORATED (DENRO), ON THE BASIS THAT ONLY THESE TWO FIRMS HAD PREVIOUSLY PRODUCED THE TYPE OF EQUIPMENT REQUESTED. YOUR FIRM LEARNED OF THE PROCUREMENT FROM THE COMMERCE BUSINESS DAILY AND SUBMITTED AN OFFER ALONG WITH THE TWO CONCERNS SOLICITED.

THE NAVY CONCLUDED THAT THE PROPOSAL SUBMITTED BY DENRO EVIDENCED A PROPER UNDERSTANDING OF WHAT WAS REQUIRED, THAT THE VELCO PROPOSAL CONTAINED SOME AREAS OF QUESTIONABLE UNDERSTANDING AND THAT YOUR PROPOSAL "DISPLAYED A LACK OF UNDERSTANDING OF THE SYSTEM DESIGN REQUIREMENTS."

VELCO WAS INVITED TO DISCUSS ITS TECHNICAL PROPOSAL AND CLARIFIED THE QUESTIONABLE AREAS TO THE SATISFACTION OF THE NAVY. TIA WAS ALSO INVITED TO CLARIFY ITS PROPOSAL AT A MEETING ON AUGUST 23, 1971. IT WAS CONCLUDED, HOWEVER, THAT THE CLARIFICATIONS OFFERED BY TIA PROVIDED NO BASIS FOR REVERSING THE EARLIER DETERMINATION THAT TIA HAD NOT DISPLAYED THE REQUIRED UNDERSTANDING OF THE SYSTEM. TIA WAS SO ADVISED BY LETTER OF SEPTEMBER 1, 1971.

IT IS NAVY'S POSITION THAT YOUR PROPOSAL IS OUTSIDE OF THE COMPETITIVE RANGE FOR TECHNICAL REASONS AND, THEREFORE, THAT FURTHER DISCUSSION WITH YOUR CONCERN WAS NOT REQUIRED. AWARD HAS BEEN WITHHELD PENDING THE RESOLUTION OF THE PROTEST BY OUR OFFICE.

BASICALLY, YOU CONTEND THAT TIA IS WITHIN THE TECHNICAL RANGE AND THAT IT IS IMPROPER TO EXCLUDE TIA FROM FURTHER PARTICIPATION. IN THIS REGARD YOU URGE THAT NAVY SHOULD BE REQUIRED TO ADVISE TIA OF THE SPECIFIC DEFICIENCIES IN ITS PROPOSAL AND TIA SHOULD BE ALLOWED TO CORRECT THESE DEFICIENCIES. YOU CONTEND THAT THE AUGUST 23, 1971, MEETING CANNOT BE CONSIDERED AS GIVING TIA THE OPPORTUNITY AT CLARIFICATION SINCE NAVY DID NOT PROVIDE TIA WITH SUFFICIENT INFORMATION RELATING TO DEFICIENCIES TO PERMIT MEANINGFUL DIALOGUE. YOU CONTRAST THIS TO THE SPECIFIC HELP NAVY GAVE TO VELCO AND YOU ARGUE THAT TIA WAS NOT GIVEN AN EQUAL OPPORTUNITY TO COMPETE WITH VELCO.

IN YOUR LEGAL PRESENTATION YOU HAVE CITED 10 U.S.C. 2304(G) AND THE IMPLEMENTING REGULATION IN ASPR 3-805.1(A) WHICH GENERALLY REQUIRE WRITTEN OR ORAL DISCUSSIONS WITH ALL RESPONSIBLE OFFERORS WHO SUBMIT PROPOSALS WITHIN A COMPETITIVE RANGE, PRICE AND OTHER FACTORS CONSIDERED. YOU HAVE CITED A NUMBER OF CASES, 47 COMP. GEN. 252 (1967); 47 ID. 29 (1967); 46 ID. 191, 193 (1966) AND 45 ID. 417, 427 (1966) AS STANDING FOR THE PROPOSITION THAT NEGOTIATIONS SHOULD BE CONDUCTED WITH AN OFFEROR UNLESS ITS PROPOSAL IS SO INFERIOR AS TO PRECLUDE ANY POSSIBILITY OF MEANINGFUL NEGOTIATION. YOU HAVE CITED 48 COMP. GEN. 583, 592 (1969) FOR THE PROPOSITION THAT ALL COMPETITIVE OFFERS SHOULD BE TREATED EQUALLY. FINALLY, YOU HAVE CITED B-173181, DECEMBER 20, 1971, 51 COMP. GEN. , AS INDICATING THE DEGREE TO WHICH THE CONTRACTING OFFICER SHOULD GO IN FURTHERING THE GOAL OF MAXIMIZING COMPETITION. SINCE THIS CASE INVOLVES PRIMARILY TECHNICAL CONSIDERATIONS WE ALSO RECOGNIZE A REASONABLE DEGREE OF ADMINISTRATIVE DISCRETION IN DETERMINING WHETHER A PROPOSAL IS WITHIN THE COMPETITIVE RANGE. SEE B-170616, FEBRUARY 23, 1971, AND B-171581, APRIL 8, 1971.

THERE HAS BEEN MUCH TECHNICAL INFORMATION FURNISHED TO OUR OFFICE, BOTH FROM YOUR COMPANY AND FROM THE NAVY. THE ISSUE HERE IS WHETHER OR NOT THE ADMINISTRATIVE CONCLUSION AS TO THE ACCEPTABILITY OF YOUR PROPOSAL WAS AN ARBITRARY OR CAPRICIOUS ONE. OUR RESPONSIBILITY IN THIS AREA IS TO INSURE THAT THE TECHNICAL JUDGMENTS ARE MADE ON A REASONABLE AND FAIR BASIS AND THAT THE PROCEDURAL REQUIREMENTS HAVE BEEN SATISFIED.

THE PROCURING ACTIVITY ASSERTS THAT YOUR PROPOSAL INCLUDES A NUMBER OF MAJOR DEFICIENCIES. ONE OF THESE INVOLVED THE RADIOPHONE PROGRAMMING PANEL, WITH RESPECT TO WHICH YOU OFFERED A BASIC PROPOSAL (OFFER A) AND TWO ALTERNATE PROPOSALS (OFFERS B AND C). YOUR OFFERS A AND B PROPOSED THE USE OF ELCO PLUGS WHICH WERE FOUND TO BE CONTRARY TO THE INTERCHANGEABILITY CLAUSE OF THE SPECIFICATIONS. YOUR BASIC PROPOSAL WAS HELD UNACCEPTABLE BECAUSE OF THE HIGH REAR PANEL WIRING DENSITY WHICH WOULD LIMIT ACCESSIBILITY AND IMPACT INSTALLATION AND MAINTENANCE COSTS ADVERSELY. UNDER OFFER B THERE WAS EVEN LESS ACCESS FOR MAINTAINABILITY. UNDER OFFER C YOU PROPOSED TO USE THE PATCH PLUGS OF THE UNMODIFIED AN/FSA -52(V) SYSTEM. HOWEVER, YOUR CHANNEL SHARING PROPOSAL PERMITTED AN OPERATOR OTHER THAN THE ONE WHO SELECTED THE CHANNEL TO MODULATE THE RADIO TRANSMITTER WHILE EXCLUDING THE ORIGINAL OPERATOR. THE NAVY ADVISED US THAT THIS WOULD PRESENT A SAFETY RISK. THEREFORE, IT WAS CONCLUDED THAT YOUR BASIC AND BOTH ALTERNATE PROPOSALS WERE MATERIALLY DEFICIENT IN THE RADIOPHONE PROGRAMMING PANEL. WE HAVE DETERMINED THAT THE AGENCY'S CONCLUSION IS REASONABLE BASED ON OUR INDEPENDENT TECHNICAL REVIEW.

THE AGENCY ASSERTS THAT THE SWITCHES ON THE TRANSMITTER SWITCH SELECTION PANEL (AND HERE YOU DID NOT PROVIDE ANY ALTERNATES) ARE NOT INTERCHANGEABLE WITH THE PREVIOUS SYSTEM AS REQUIRED BY THE RFP.

YOUR PROPOSED DESIGN OF THE CONTROL CONSOLE IS SAID TO PROVIDE FOR THE ELIMINATION OF A NUMBER OF ATTENUATORS IN CRITICAL PLACES AND AS A RESULT OF THIS THERE COULD BE CROSSTALK AND NOISE OF AN UNACCEPTABLE LEVEL. AGAIN, OUR REVIEW INDICATES THAT THERE IS MERIT TO THE AGENCY'S POSITION.

FINALLY, NAVY FOUND THAT YOUR POWER SUPPLY WAS INADEQUATE. OUR TECHNICAL REVIEW ALSO SUPPORTS THIS FINDING.

YOUR POSITION IS THAT THE DEFICIENCIES IN YOUR PROPOSAL ARE CORRECTABLE. OUR REVIEW DOES NOT DISPUTE THIS; HOWEVER, IN ORDER TO ACCOMPLISH THESE CORRECTIONS YOU WOULD HAVE NEEDED TECHNICAL ASSISTANCE FROM NAVY AND IT WOULD HAVE BEEN NECESSARY TO REDESIGN YOUR PROPOSAL. NAVY, IN EXERCISING ITS DISCRETION, DECIDED NOT TO RENDER TECHNICAL ASSISTANCE TO YOUR FIRM SINCE NAVY HAD TWO PROPOSALS WHICH WERE FOUND TO BE TECHNICALLY ACCEPTABLE. AT THE AUGUST 23 MEETING NAVY WAS APPARENTLY PREPARED TO LISTEN TO YOUR TECHNICAL PRESENTATION BUT NAVY DECLINED TO OFFER ANY DETAILED TECHNICAL HELP AS TO HOW TO MAKE YOUR PROPOSAL ACCEPTABLE.

WE THINK THERE IS MERIT TO THE VIEW THAT THE OFFEROR HAS THE PRIMARY RESPONSIBILITY TO SUBMIT A COMPETITIVE PROPOSAL AND THAT THERE IS NO UNLIMITED DUTY TO HELP AN OFFEROR MAKE AN UNACCEPTABLE PROPOSAL ACCEPTABLE. SINCE THE DEFECTS IN YOUR PROPOSAL REQUIRED MATERIAL DESIGN CHANGES WE DO NOT BELIEVE NAVY ABUSED ITS DISCRETION IN DECLINING TO GIVE YOU SPECIFIC TECHNICAL HELP TO MAKE YOUR PROPOSAL ACCEPTABLE. SEE B- 174125, MARCH 28, 1972.

MOREOVER, WE DO NOT BELIEVE IT WAS IMPROPER FOR NAVY TO COMPARE YOUR PROPOSAL TO THE OTHER PROPOSALS RECEIVED IN DETERMINING WHETHER YOUR PROPOSAL WAS IN THE COMPETITIVE RANGE. IF THE COMPETITIVE RANGE DETERMINATION HAD BEEN BASED SOLELY ON A COMPARISON OF THE EVALUATION SCORE OF EACH OFFEROR'S PROPOSAL WITH AN ARBITRARY, INFLEXIBLE PREDETERMINED SCORE FOR TECHNICAL ACCEPTABILITY, THIS WOULD NOT HAVE BEEN CONDUCIVE TO OBTAINING THE MAXIMUM COMPETITION OR FLEXIBILITY CONTEMPLATED BY THE PROCUREMENT STATUTES AND REGULATIONS COVERING NEGOTIATIONS. SEE B- 174003, FEBRUARY 10, 1972. YOUR PROPOSAL COMPARED TO THE OTHER TWO WAS DETERMINED TO BE SUBSTANTIALLY INFERIOR FROM THE STANDPOINT OF DESIGN APPROACH. OUR REVIEW HAS FOUND NO BASIS TO DISAGREE. CONSEQUENTLY, WE FIND THAT NAVY HAS SUFFICIENT REASONS TO JUSTIFY THE DETERMINATION THAT YOUR PROPOSAL WAS OUTSIDE THE COMPETITIVE RANGE FOR TECHNICAL REASONS.

WE DO NOT FIND THAT B-173181, DECEMBER 20, 1971 (51 COMP. GEN. ), IS IN POINT. THAT CASE INVOLVED A TWO-STEP ADVERTISED PROCUREMENT IN WHICH THE AGENCY TOOK DETERMINED STEPS TO AVOID MAKING A SOLE-SOURCE AWARD. WHILE A NUMBER OF SPECIFIC QUESTIONS WERE FURNISHED TO AN OFFEROR INITIALLY FOUND TO BE UNACCEPTABLE ONLY CLARIFICATIONS WERE REQUESTED; A MAJOR REDESIGN OF THE INITIAL PROPOSAL WAS NOT REQUIRED. FOR THIS SAME REASON WE DO NOT FIND THAT THE OTHER CASES CITED BY YOU WOULD BE APPLICABLE HERE.

WE HAVE REVIEWED THE QUESTIONS WHICH NAVY SENT TO VELCO. ON THE BASIS OF THOSE QUESTIONS WE CANNOT CONCLUDE THAT NAVY WAS GIVING VELCO ANY SPECIFIC HELP TO MAKE ITS PROPOSAL ACCEPTABLE. VELCO'S DESIGN AS SUBMITTED WAS ACCEPTABLE AND NAVY WAS MERELY REQUESTING CLARIFICATION OF CERTAIN AREAS; VELCO WAS NOT GIVEN INFORMATION AS TO THE PROPER DESIGN APPROACHES. UPON RECEIPT OF VELCO'S RESPONSES NAVY WAS SATISFIED THAT VELCO HAD DEMONSTRATED AN UNDERSTANDING OF WHAT WAS REQUIRED. WE FIND NO BASIS TO QUESTION THIS ACTION BY NAVY.

IN THE ENCLOSED COPY OF THE LETTER TO THE SECRETARY OF THE NAVY WE HAVE INDICATED THAT THE SPECIFICATIONS MIGHT HAVE MORE CLEARLY SPELLED OUT WHAT WAS REQUIRED CITING AS AN EXAMPLE THAT THE SPECIFICATIONS MIGHT HAVE IDENTIFIED THE TYPE OF PLUG. HOWEVER, EVEN IF THE TYPE OF PLUG HAD BEEN SPECIFIED, THIS WOULD NOT MEAN THAT YOUR PROPOSAL WOULD HAVE BEEN ACCEPTABLE. ONE OF YOUR ALTERNATES, WHICH WAS NOT BASED ON USING ELCO PLUGS, WAS ALSO UNACCEPTABLE IN THE DESIGN APPROACH BUT FOR OTHER REASONS. MOREOVER, IN VIEW OF NAVY'S ADVICE THAT THE AMPHENOL/METHODE PLUG WAS DEVELOPED WITH RESPECT TO THE STANDARD FSA 52, YOU WERE ON SUFFICIENT NOTICE AS TO THE TYPE OF PLUG WHICH WOULD MEET THE INTERCHANGEABILITY REQUIREMENT. THEREFORE, WE DO NOT BELIEVE THAT CANCELLATION OF THE SOLICITATION IS REQUIRED IN THESE CIRCUMSTANCES.

FOR THESE REASONS YOUR PROTEST IS DENIED.