B-176680, FEB 5, 1973

B-176680: Feb 5, 1973

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THE MEAN TIME BETWEEN FAILURE CRITERIA CONTAINED IN THIS RFP WAS INTENDED AS A WARRANTY REQUIREMENT. THERE IS NO BASIS TO CONCLUDE THAT THE PROPOSALS WERE NOT PROPERLY EVALUATED. YOU HAVE PROTESTED AGAINST THE AWARD OF A CONTRACT TO MINCOM DIVISION. THE RFP WAS ISSUED ON FEBRUARY 3. RFP'S WERE ALSO SENT TO SPIN PHYSICS AND SAKI MAGNETICS PURSUANT TO REQUESTS FROM THESE CONCERNS. THESE ASSEMBLIES ARE USED IN CONNECTION WITH TRANSMITTER AND RECORDING EQUIPMENT AT VARIOUS MESSAGE CENTERS TO RECORD MESSAGES. REQUESTING THAT THE SOLICITATION LIST THOSE FACTORS OTHER THAN PRICE WHICH WILL BE CONSIDERED IN THE EVALUATION. UPON REEVALUATION THE PROCURING ACTIVITY FOUND THAT ADEQUATE DOCUMENTATION WAS AVAILABLE TO JUSTIFY PROCUREMENT OF SPIN PHYSICS' HEAD ASSEMBLIES AS BEING EQUALLY ACCEPTABLE.

B-176680, FEB 5, 1973

BID PROTEST - MEAN TIME BETWEEN FAILURE CRITERIA PROPOSAL EVALUATION DECISION DENYING THE PROTEST OF SPIN PHYSICS, INC., AGAINST THE AWARD OF A CONTRACT TO MINCOM DIVISION, 3M COMPANY UNDER AN RFP ISSUED BY THE U.S. ARMY ELECTRONICS COMMAND, PHILADELPHIA, PA. THE MEAN TIME BETWEEN FAILURE CRITERIA CONTAINED IN THIS RFP WAS INTENDED AS A WARRANTY REQUIREMENT, NOT A PERFORMANCE REQUIREMENT. FURTHERMORE, THERE IS NO BASIS TO CONCLUDE THAT THE PROPOSALS WERE NOT PROPERLY EVALUATED.

TO SPIN PHYSICS, INCORPORATED:

BY TELEGRAM OF AUGUST 2, 1972, AND LETTERS OF OCTOBER 20 AND NOVEMBER 22, 1972, YOU HAVE PROTESTED AGAINST THE AWARD OF A CONTRACT TO MINCOM DIVISION, 3M COMPANY (MINCOM) UNDER REQUEST FOR PROPOSALS (RFP) NO. DAAB05 -72-R-0184, ISSUED BY THE UNITED STATES ARMY ELECTRONICS COMMAND (ECOM), PHILADELPHIA, PENNSYLVANIA.

THE RFP WAS ISSUED ON FEBRUARY 3, 1972, FOR A QUANTITY OF 110 HEAD ASSEMBLIES SPECIFYING ONLY MINCOM PART NUMBERS. HOWEVER, RFP'S WERE ALSO SENT TO SPIN PHYSICS AND SAKI MAGNETICS PURSUANT TO REQUESTS FROM THESE CONCERNS. THESE ASSEMBLIES ARE USED IN CONNECTION WITH TRANSMITTER AND RECORDING EQUIPMENT AT VARIOUS MESSAGE CENTERS TO RECORD MESSAGES.

BY LETTER OF FEBRUARY 17, 1972, YOU SUGGESTED TO ARMY THAT THE RFP SHOULD BE EVALUATED ON FACTORS SUCH AS SERVICE LIFE OF THE EQUIPMENT. TELEGRAM OF FEBRUARY 18, YOU PROTESTED ANY AWARD OF A CONTRACT, REQUESTING THAT THE SOLICITATION LIST THOSE FACTORS OTHER THAN PRICE WHICH WILL BE CONSIDERED IN THE EVALUATION; THAT AN ITEM IN THE RFP SHOULD BE CLARIFIED, AND THAT THE CLOSING DATE FOR RECEIPT OF OFFERS SHOULD BE EXTENDED.

UPON REEVALUATION THE PROCURING ACTIVITY FOUND THAT ADEQUATE DOCUMENTATION WAS AVAILABLE TO JUSTIFY PROCUREMENT OF SPIN PHYSICS' HEAD ASSEMBLIES AS BEING EQUALLY ACCEPTABLE. AMENDMENT 0001, ISSUED ON APRIL 5, 1972, ADDED SPIN PHYSICS' PART NUMBERS AND ALSO SET FORTH A PROVISION IN SPECIAL NOTE 2, STATING IN PART AS FOLLOWS:

"THE CONTRACTOR AGREES THAT THE SUPPLIES FURNISHED UNDER THIS CONTRACT SHALL BE WARRANTED AGAINST DEFECTS IN MATERIALS AND WORKMANSHIP AS SPECIFIED BELOW. THE RIGHTS AND REMEDIES PROVIDED HEREIN ARE IN ADDITION TO AND DO NOT LIMIT ANY RIGHTS AFFORDED TO THE GOVERNMENT BY ANY OTHER PROVISION OF THIS CONTRACT. THE FOLLOWING IS APPLICABLE:

"A. THE VENDOR WILL FURNISH A WRITTEN UNCONDITIONAL WARRANTY FOR MEAN TIME BETWEEN FAILURE AS SPECIFIED BELOW:

120 IPS* NON PRORATED 1000 HOURS

60 IPS NON PRORATED 2000 HOURS

30 IPS NON PRORATED 4000 HOURS

15 IPS NON PRORATED 10000 HOURS

"B. IF THE HEAD FAILS TO ACHIEVE THE WARRANTED HOURS, IT WILL BE SERVICED BY REPLACEMENT, REPAIR OR RESTACKING AT NO EXPENSE TO THE GOVERNMENT. THE SERVICED ASSEMBLY WILL BE WARRANTED FOR THE UNEXPIRED PORTION OF THE ORIGINAL WARRANTY."

*IPS INCHES PER SECOND.

THE AMENDED CLOSING DATE FOR RECEIPT OF OFFERS WAS APRIL 21, 1972.

SPIN PHYSICS' OFFER SUBMITTED ON APRIL 21 AGREED TO THE WARRANTY PROVISION. HOWEVER, A LETTER OF PROTEST WAS ENCLOSED WITH THE OFFER ALLEGING THAT THE SOLICITATION WAS AMBIGUOUS SINCE THE MINCOM HEAD ASSEMBLIES SPECIFIED IN THE RFP WERE NOT CAPABLE OF OPERATION FOR 10,000 HOURS AT 15 IPS, THE MTBF CRITERIA IN THE WARRANTY PROVISION. IN THIS REGARD THE LETTER STATED THAT PREVIOUS EXPERIENCE HAD INDICATED THAT THE MINCOM HEAD ASSEMBLIES SPECIFIED HAVE A LIFE EXPECTANCY OF ABOUT 3,500 HOURS AT 15 IPS. A LETTER DATED JUNE 6, 1972, FROM THE ARMY SECURITY AGENCY (ASA), WARRENTON, VIRGINIA, TO FORT MONMOUTH, NEW JERSEY, STATED THAT ASA'S EXPERIENCE CONFIRMS SPIN PHYSICS' CONTENTION THAT MINCOM'S HEAD ASSEMBLIES HAVE A LIFE OF 3,500 HOURS AT 15 IPS. THE AGENCY STATED THAT LIFE EXPECTANCY DATA AT 120 IPS IS NOT AVAILABLE SINCE RECORDERS ARE GENERALLY USED AT A SPEED OF 15 IPS. ASA ALSO ADVISED THAT IT HAD ONLY LIMITED EXPERIENCE WITH THE SPIN PHYSICS' HEAD ASSEMBLIES.

ON JUNE 22, 1972, SPIN PHYSICS SENT A TELEGRAM ADVISING THE PROCURING ACTIVITY THAT ITS PROTEST AGAINST THE SOLICITATION WAS WITHDRAWN. TELEGRAM OF JUNE 26 MINCOM AGREED TO THE WARRANTY COVERAGE REQUIRED BY AMENDMENT 0001. SAKI MAGNETICS DID NOT SUBMIT AN OFFER. FINAL PRICES WERE RECEIVED AND MINCOM'S TOTAL PRICE OF $108,000 WAS $34,000 LESS THAN SPIN PHYSICS' PRICE OF $142,900. THE PROCURING ACTIVITY MADE AWARD TO MINCOM AS THE LOW OFFEROR ON JULY 7, 1972. NOTICE OF THE AWARD WAS SENT TO YOUR CONCERN ON THE SAME DATE. THE OPTION FOR ADDITIONAL QUANTITIES HAS ALSO BEEN EXERCISED. WE HAVE BEEN ADVISED THAT ALL OF THE ITEMS UNDER THE BASIC CONTRACT AND MOST OF THE OPTION QUANTITIES HAVE NOW BEEN DELIVERED.

THE AWARD TO MINCOM AS THE LOW OFFEROR WAS BASED ON THE PROCURING ACTIVITY'S DETERMINATION THAT BOTH MINCOM'S AND SPIN PHYSICS' HEAD ASSEMBLIES WERE ACCEPTABLE. A TELEGRAM FROM ASA, WARRENTON, VIRGINIA, RECEIVED BY THE PROCURING ACTIVITY ON SEPTEMBER 1, 1972, AND A TELEGRAM FROM KELLY AIR FORCE BASE (KELLY), RECEIVED BY THE PROCURING ACTIVITY ON SEPTEMBER 5, 1972, HAVE CONFIRMED THIS DETERMINATION. THE TELEGRAM FROM KELLY GOES ON TO STATE THAT EXTENSIVE TESTING HAD BEEN CONDUCTED FROM NOVEMBER 1970 THROUGH JUNE 1971 ON THE HEAD ASSEMBLIES OF BOTH MANUFACTURERS AND THAT ALTHOUGH FAILURES WERE EXPERIENCED WITH UNITS OF BOTH MANUFACTURERS WHILE STILL UNDER WARRANTY, THE UNITS WERE REPAIRED OR REPLACED WITHOUT ANY EXPENSE TO THE ACTIVITY. YOU HAVE BEEN FURNISHED WITH COPIES OF BOTH OF THESE TELEGRAMS.

THE BASIS OF YOUR PROTEST IS THAT THE MTBF CRITERIA IN SPECIAL NOTE 2 WAS A PERFORMANCE REQUIREMENT WHICH COULD NOT BE MET BY THE MINCOM HEAD ASSEMBLIES SPECIFIED IN THE SCHEDULE AND, THEREFORE, MINCOM SHOULD NOT HAVE RECEIVED THE AWARD.

THE ADMINISTRATIVE POSITION IS THAT IT WAS NOT INTENDED THAT THE MTBF SHOULD BE AN INHERENT REQUIREMENT OF EACH HEAD ASSEMBLY BUT ONLY THAT THE HEAD ASSEMBLIES BE WARRANTED IN THE EVENT OF FAILURE. IN THIS REGARD THE ADMINISTRATIVE REPORT STATES THAT THE LIFE OF A HEAD ASSEMBLY IS CONTINGENT UPON NUMEROUS FACTORS, INCLUDING THE QUALITY OF THE HEAD ASSEMBLY, THE TYPE AND QUALITY OF THE TAPE TO BE USED, THE ACTUAL CONDITION OF THE RECORDER-REPRODUCER, THE SPECIFIC REQUIREMENTS OF EACH USER, AND OF COURSE HUMAN FAILURE. THEREFORE IT WAS CONSIDERED THAT THE ONLY REASONABLE METHOD OF ACHIEVING THE DESIRED MTBF RATE WAS BY USING A WARRANTY PROVISION.

WE AGREE WITH THE ADMINISTRATIVE POSITION AS TO THE MEANING OF SPECIAL NOTE 2. THERE IS NOTHING IN SPECIAL NOTE 2 TO INDICATE THAT THE MTBF WAS ANYTHING MORE THAN A WARRANTY REQUIREMENT.

YOU ALSO CONTEND THAT WHILE MINCOM QUOTED A LOWER UNIT PRICE, THE ARMY SHOULD ALSO HAVE EVALUATED THE COST OF IDLE TIME DUE TO REPAIR OR REPLACEMENT OF ITEMS. IN THIS CONNECTION, YOU HAVE CONTENDED THAT YOUR HEAD ASSEMBLIES HAVE A LONGER LIFE THAN MINCOM'S ASSEMBLIES AND, THEREFORE, LOWER COSTS WOULD BE INCURRED BY THE AGENCY FOR IDLE TIME USING YOUR ITEMS.

WE HAVE BEEN ADVISED BY THE ARMY THAT IT WAS NOT CONSIDERED FEASIBLE TO INCLUDE IDLE TIME AS AN EVALUATION FACTOR SINCE IT WAS NECESSARY TO HAVE SUBSTANTIAL TEST DATA ON THE EQUIPMENT OFFERED BEFORE IT WOULD BE POSSIBLE TO PUT A DOLLAR FIGURE ON THE COST OF IDLE TIME. THIS TYPE OF DATA WAS UNAVAILABLE AT THE TIME OF THE INSTANT PROCUREMENT AND, THEREFORE, IDLE TIME WAS NOT INCLUDED AS AN EVALUATION FACTOR.

WE HAVE NO BASIS TO CONCLUDE THAT THE PROPOSALS WERE NOT PROPERLY EVALUATED. ACCORDINGLY, YOUR PROTEST AGAINST THE AWARD IS DENIED.