B-175168, MAY 24, 1972

B-175168: May 24, 1972

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SINCE THE USE OF THE ALTERNATE DELIVERY SCHEDULE WAS PROPER. IT WAS ALSO PROPER FOR THE CONTRACTING AGENCY TO EVALUATE THE BIDS USING THE LESSER NUMBER OF DELIVERIES NEEDED ON THE ALTERNATE DELIVERY SCHEDULE. RUDOLPH: REFERENCE IS MADE TO YOUR LETTERS OF MARCH 8. WAS FOR A CUMULATIVE QUANTITY OF ROCKET LAUNCHERS. A MINIMUM REQUIREMENT OF 600 LAUNCHERS WAS SOUGHT. QUANTITIES FROM 600 TO MORE THAN 1800 WERE DIVIDED INTO BASED UPON THE PROBABILITY AND SIZE OF FUTURE NEEDS WERE ASSIGNED TO THE FIRST THREE RANGES. THE FOUR LOWEST BIDS RECEIVED WERE EVALUATED IN ACCORDANCE WITH THE PROCEDURES SPELLED OUT IN THE INVITATION. THE FIRST ARTICLE COSTS (THE FIRST ARTICLE REQUIREMENT WAS WAIVED FOR A.

B-175168, MAY 24, 1972

BID PROTEST - BID EVALUATION - TRANSPORTATION CHARGES DENIAL OF PROTEST ON BEHALF OF LIBERTY AERO, INC., AGAINST THE AWARD OF A CONTRACT UNDER AN IFB ISSUED AS A 100 PERCENT SMALL BUSINESS SET ASIDE BY THE U.S. ARMY MISSILE COMMAND, REDSTONE ARSENAL, ALA., FOR A CUMULATIVE QUANTITY OF ROCKET LAUNCHERS. ASPR 1.305-4, WHICH SETS FORTH VARIOUS DELIVERY SCHEDULE PROVISIONS FOR INCLUSION IN SOLICITATIONS, DOES PERMIT THE USE OF THE LANGUAGE CONTAINED IN THE IFB WITHOUT ANY NEED FOR OBTAINING SPECIAL AUTHORIZATION. SINCE THE USE OF THE ALTERNATE DELIVERY SCHEDULE WAS PROPER, IT WAS ALSO PROPER FOR THE CONTRACTING AGENCY TO EVALUATE THE BIDS USING THE LESSER NUMBER OF DELIVERIES NEEDED ON THE ALTERNATE DELIVERY SCHEDULE.

TO EDWARD M. RUDOLPH:

REFERENCE IS MADE TO YOUR LETTERS OF MARCH 8, 1972 AND APRIL 10, 1972, ON BEHALF OF LIBERTY AERO, INCORPORATED, PROTESTING AGAINST AWARD OF A CONTRACT UNDER INVITATION FOR BIDS NO. DAAH01-72-B-0254, ISSUED BY THE UNITED STATES ARMY MISSILE COMMAND, REDSTONE ARSENAL, ALABAMA.

THE INVITATION, A 100 PERCENT SMALL BUSINESS SET-ASIDE, WAS FOR A CUMULATIVE QUANTITY OF ROCKET LAUNCHERS. A MINIMUM REQUIREMENT OF 600 LAUNCHERS WAS SOUGHT, WITH AN ESTIMATED MAXIMUM OF 1800 TO BE ORDERED BY DECEMBER 1973. QUANTITIES FROM 600 TO MORE THAN 1800 WERE DIVIDED INTO BASED UPON THE PROBABILITY AND SIZE OF FUTURE NEEDS WERE ASSIGNED TO THE FIRST THREE RANGES. SECTION H OF THE IFB SET FORTH A REQUIRED DELIVERY SCHEDULE, AND ALSO INCLUDED THE FOLLOWING:

"B. *** WHERE A BIDDER OFFERS AN EARLIER DELIVERY SCHEDULE THAN THAT CALLED FOR ABOVE, THE GOVERNMENT RESERVES THE RIGHT TO AWARD EITHER IN ACCORDANCE WITH THE REQUIRED SCHEDULE OR IN ACCORDANCE WITH THE SCHEDULE OFFERED BY THE BIDDER. ***

"C. IF BIDDER WISHES TO OFFER AN EARLIER DELIVERY SCHEDULE AT A LOWER PRICE, HE MAY SET IT FORTH BELOW. THE ASSOCIATED LOWER UNIT PRICES FOR RANGES 1-4 SHOULD BE UNDER THE COLUMN, 'EARLIER DELIVERY UNIT PRICE' ON PAGE 20."

THE FOUR LOWEST BIDS RECEIVED WERE EVALUATED IN ACCORDANCE WITH THE PROCEDURES SPELLED OUT IN THE INVITATION. AN ALTERNATE BID SUBMITTED BY A. C. ELECTRONICS, INCORPORATED, PROPOSED AN EARLIER DELIVERY SCHEDULE.

UPON APPLICATION OF THE RANGE WEIGHTING FACTORS, THE FIRST ARTICLE COSTS (THE FIRST ARTICLE REQUIREMENT WAS WAIVED FOR A. C. ELECTRONICS SINCE IT WAS A PREVIOUS SUPPLIER), AND DISCOUNTS, LIBERTY AERO WAS FOUND TO BE THE LOW BIDDER WITH AN EVALUATED UNIT PRICE OF $585.78, WHILE A. C. ELECTRONICS WAS SECOND LOW ON ITS ALTERNATE BID WITH AN EVALUATED UNIT PRICE OF $589.55. HOWEVER, THE LAST STEP IN THE EVALUATION PROCESS, ADDING TRANSPORTATION COST TO THE DISCOUNTED EVALUATED UNIT PRICE, RESULTED IN A TOTAL EVALUATED UNIT PRICE OF $591.09 FOR A. C. ELECTRONICS AND A PRICE OF $591.31 FOR LIBERTY AERO. IN EACH CASE THE TRANSPORTATION WAS COMPUTED ON THE BASIS OF LOWEST COST. THUS, WHILE THE COST OF RAILROAD TRANSPORTATION WAS UTILIZED IN EVALUATING THE OTHER BIDS, THE ARMY EVALUATED LIBERTY AERO'S BID ON THE BASIS OF TRUCK TRANSPORTATION BECAUSE IT WAS LESS COSTLY. SIMILARLY, THE A. C. ELECTRONICS BID TRANSPORTATION COST WAS COMPUTED ON THE BASIS OF THE ACTUAL FEWER NUMBER OF SHIPMENTS TO BE MADE BECAUSE OF THE ACCELERATED DELIVERY. ON APRIL 21, 1972, AWARD WAS MADE TO THE EVALUATED LOW BIDDER, A. C. ELECTRONICS.

YOU CLAIM THAT UNFAIR METHODS OF EVALUATION WERE USED TO BRING A. C. ELECTRONICS' BID PRICE BELOW LIBERTY AERO'S. YOU RECOGNIZE THAT CERTAIN ADVANTAGES ACCRUED TO A. C. ELECTRONICS IN THE EVALUATION PROCESS BECAUSE OF ITS CLOSER LOCATION TO THE FINAL POINT OF DESTINATION AND THE WAIVER OF FIRST ARTICLE TESTING. HOWEVER, YOU ASSERT THAT FOR BID EVALUATION PURPOSES A. C.'S ALTERNATE OFFER PROVIDING FOR EARLIER DELIVERY SHOULD NOT HAVE BEEN CONSIDERED BECAUSE THE IFB DID NOT PROVIDE FOR EVALUATION OF ALTERNATE DELIVERY SCHEDULES COUPLED WITH ALTERNATE PRICES. IN ESSENCE, YOU CLAIM THAT ALL BIDS SHOULD HAVE BEEN EVALUATED ON THE REQUIRED DELIVERY REQUIREMENTS, AND NOT ON AN ALTERNATE DELIVERY SCHEDULE.

WE DO NOT AGREE. WE FIND NOTHING IMPROPER WITH THE GOVERNMENT'S INVITING ALTERNATE DELIVERY SCHEDULES AT LOWER PRICES ALONG WITH BIDS FOR THE REQUIRED DELIVERY SCHEDULE, SINCE ALTERNATE OFFERS COULD BE MORE ADVANTAGEOUS TO THE GOVERNMENT WITH RESPECT TO PRICE WHILE STILL MEETING THE GOVERNMENT'S ACTUAL NEEDS. SINCE THE PROPOSED EARLIER DELIVERY SCHEDULE WOULD NECESSITATE FEWER SHIPMENTS THAN THE REQUIRED DELIVERY SCHEDULE, IT WOULD BE IMPROPER TO EVALUATE TRANSPORTATION COSTS OF THE ALTERNATE PROPOSAL ON THE BASIS OF THE GREATER NUMBER OF SHIPMENTS.

YOU ALSO CLAIM THAT THE USE OF PARAGRAPH H-1C OF THE IFB, ALLOWING OFFERS FOR EARLIER DELIVERY AT A LOWER PRICE, IS A DEVIATION OF THE ASPR LANGUAGE INCORPORATED IN PARAGRAPH H-1B OF THE IFB AND THAT YOU ARE UNAWARE OF ANY AUTHORIZATION FOR THE USE OF SUCH A PROVISION. ASPR 1.305-4, WHICH SETS FORTH VARIOUS DELIVERY PROVISIONS FOR INCLUSION IN SOLICITATIONS, INCLUDING THE PROVISION OF IFB PARAGRAPH H-1B, SPECIFICALLY STATES:

"(A) EXAMPLES OF TIME OF DELIVERY CLAUSES *** ARE SET FORTH BELOW. THEY MAY BE MODIFIED OR OTHER CLAUSES MAY BE USED TO STATE PARTICULAR DELIVERY REQUIREMENTS OR ANY SPECIAL PROCEDURES TO BE USED IN THE EVALUATION, REJECTION OR AWARD PROCESS AS REGARDS TIME OF DELIVERY. *** "

WE THINK THE ABOVE LANGUAGE PERMITS THE USE OF THE PROVISION CONTAINED IN PARAGRAPH H-1C WITHOUT ANY NEED FOR OBTAINING SPECIAL AUTHORIZATION.

IT IS ALSO CONTENDED BY LIBERTY AERO THAT THE ARMY IMPROPERLY INCLUDED THE COST OF DELIVERY TO THE RAIL CAR AND THE LOADING OF RAIL CARS IN EVALUATING ITS BID. THE ARMY DENIES THIS, AND WE CAN FIND NOTHING IN THE RECORD TO SUBSTANTIATE THIS ALLEGATION. IN FACT, THE FILE CONTAINS A STATEMENT BY A TRANSPORTATION OFFICIAL OF THE REDSTONE ARSENAL THAT EVALUATION OF LIBERTY AERO'S BID DID NOT INCLUDE "THE ADDITIONAL CHARGE OF 7 1/2[ CWT FOR LOADING TRUCKS AT ORIGIN SINCE IFB WAS BASED UPON MATERIAL LOADED ON CARRIER'S EQUIPMENT."

FOR THE FOREGOING REASONS, YOUR PROTEST MUST BE DENIED.