B-177353(1), APR 4, 1973

B-177353(1): Apr 4, 1973

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GAO DOES NOT CONCLUDE THAT THIS AWARD WAS SO PLAINLY OR PALPABLY ILLEGAL SO AS TO REQUIRE CANCELLATION. 50 COMP. INCORPORATED: REFERENCE IS MADE TO YOUR LETTERS DATED OCTOBER 27 AND 30 AND DECEMBER 26. THE SOLICITATION WAS ORIGINALLY SYNOPSIZED IN THE COMMERCE BUSINESS DAILY OF AUGUST 18. THAT SYNOPSIS WAS SUBSEQUENTLY CANCELED INASMUCH AS THE USING FACILITY DETERMINED THAT A FORK LIFT TRUCK OF 4. 000 POUNDS CAPACITY WAS NEEDED DUE TO A CHANGE IN THE USE SITE. THE REQUIREMENT WAS AGAIN SYNOPSIZED ON SEPTEMBER 22. BID SETS WERE FORWARDED TO 21 POTENTIAL BIDDERS. BID OPENING WAS HELD OCTOBER 19. AT WHICH TIME ONLY ONE BID WAS RECEIVED IN RESPONSE TO THE SOLICITATION. AWARD WAS MADE TO THAT BIDDER (PAUL H.

B-177353(1), APR 4, 1973

BID PROTEST - OVERLY RESTRICTIVE SPECIFICATIONS DECISION DENYING THE PROTEST OF SCHRECK INDUSTRIES INC. AGAINST THE AWARD OF A CONTRACT TO THE PAUL H. WERRES COMPANY UNDER AN IFB ISSUED BY THE PUBLIC HEALTH SERVICE FOR A FORK LIFT TRUCK AND DOCK BOARD. ALTHOUGH GAO BELIEVES THAT THE OVERLY RESTRICTIVE MILITARY SPECIFICATIONS UTILIZED IN THIS IFB SHOULD NOT BE USED FOR COMPETITIVE PROCUREMENT PURPOSES, SEE 47 COMP. GEN. 12, 19 (1967), GAO DOES NOT CONCLUDE THAT THIS AWARD WAS SO PLAINLY OR PALPABLY ILLEGAL SO AS TO REQUIRE CANCELLATION. 50 COMP. GEN. 679, 685 (1971).

TO SCHRECK INDUSTRIES, INCORPORATED:

REFERENCE IS MADE TO YOUR LETTERS DATED OCTOBER 27 AND 30 AND DECEMBER 26, 1972, WITH ENCLOSURES, PROTESTING AWARD OF A CONTRACT TO THE PAUL H. WERRES COMPANY FOR A FORK LIFT TRUCK AND DOCK BOARD BY THE PUBLIC HEALTH SERVICE, PROCUREMENT BRANCH, UNDER INVITATION FOR BIDS NO. PL-73-3, DATED OCTOBER 2, 1972.

THE SOLICITATION WAS ORIGINALLY SYNOPSIZED IN THE COMMERCE BUSINESS DAILY OF AUGUST 18, 1972, AND CALLED FOR BIDS ON A FORK LIFT TRUCK OF 3,000 POUNDS CAPACITY. THAT SYNOPSIS WAS SUBSEQUENTLY CANCELED INASMUCH AS THE USING FACILITY DETERMINED THAT A FORK LIFT TRUCK OF 4,000 POUNDS CAPACITY WAS NEEDED DUE TO A CHANGE IN THE USE SITE. THE REQUIREMENT WAS AGAIN SYNOPSIZED ON SEPTEMBER 22, 1972, FOR BIDS ON A 4,000 POUND CAPACITY TRUCK IN ACCORDANCE WITH MILITARY SPECIFICATION MIL-T-40629, DATED AUGUST 23, 1962, ENTITLED, "TRUCK, FORK, REACHING AND TIERING, CONTINUOUS DUTY, NARROW ISLE, 4000 POUND CAPACITY, ELECTRIC." BID SETS WERE FORWARDED TO 21 POTENTIAL BIDDERS. BID OPENING WAS HELD OCTOBER 19, 1972, AT WHICH TIME ONLY ONE BID WAS RECEIVED IN RESPONSE TO THE SOLICITATION, AND AWARD WAS MADE TO THAT BIDDER (PAUL H. WERRES COMPANY) ON OCTOBER 26, 1972, OFFERING EQUIPMENT MANUFACTURED BY THE RAYMOND CORPORATION.

YOU NOTE THAT IN A LETTER DATED OCTOBER 5, 1972, TO THE PROCUREMENT OFFICER, YOU REQUESTED THAT THE PROCUREMENT EITHER BE MADE BY NEGOTIATED PROCEDURES BECAUSE THE MILITARY SPECIFICATION WAS RESTRICTIVE IN NATURE, INCORPORATING CERTAIN FEATURES FOUND ONLY IN THE RAYMOND FORK LIFT, OR THAT THE SPECIFICATION BE CHANGED TO PERMIT COMPETITION. IN THE LETTER TO THIS OFFICE YOU FURTHER STATE THAT HAD YOU BEEN PERMITTED TO COMPETE, YOUR BID WOULD HAVE BEEN APPROXIMATELY 25 PERCENT LESS THAN THE ACCEPTED BID PRICE. ALSO, YOU POINT OUT THAT, IN YOUR OPINION, "MIL-T-21643A, AS AMENDED AND REVISED TO OBTAIN INCREASED CAPACITY TO THE REQUIRED 4,000 POUNDS WOULD BE IN LINE WITH TRUCKS THAT ARE COMMERCIALLY AVAILABLE." IS YOUR CONTENTION THAT USE OF THE LATTER SPECIFICATION WOULD HAVE RESULTED IN A LOWER BID FROM YOUR COMPANY AND FROM OTHER MANUFACTURERS AS WELL.

CONCERNING YOUR LETTER OF OCTOBER 5, 1972, TO THE PROCURING OFFICE, THE CONTRACTING OFFICER STATES THAT THIS LETTER WAS NOT RECEIVED IN THE PROCURING OFFICE UNTIL OCTOBER 19, 1972, AND THEREFORE HE WAS UNABLE TO REPLY TO YOUR LETTER BEFORE OCTOBER 27, 1972.

THE CONTRACTING OFFICER REPORTS THAT THE DECISION TO PROCURE A TRUCK OF 4,000 POUNDS CAPACITY WAS BASED UPON HIS AGREEMENT WITH THE REQUESTING OFFICE THAT THE USER'S LOCATION NECESSITATED THAT SIZE. SINCE THERE WAS NO FEDERAL SPECIFICATION AVAILABLE FOR A TRUCK MEETING THE NEEDS, THE MILITARY SPECIFICATION WAS USED BECAUSE IT WAS DETERMINED THAT A TRUCK IN ACCORDANCE THEREWITH WOULD MEET THE MINIMUM NEEDS. IN THIS CONNECTION, THE CONTRACTING OFFICER POINTS OUT THAT SECTION 1-1.305-6 OF THE FEDERAL PROCUREMENT REGULATIONS PERMITS THE USE OF MILITARY SPECIFICATIONS WHERE NO FEDERAL SPECIFICATION IS AVAILABLE. WITH REGARD TO YOUR CONTENTION THAT THE SPECIFICATION IS RESTRICTIVE TO ONE MANUFACTURER, THE CONTRACTING OFFICER POINTS OUT THAT IT HAS BEEN IN EXISTENCE SINCE 1962 WITHOUT AMENDMENT OR REVISION AND APPARENTLY HAS NOT BEEN CHALLENGED AS RESTRICTIVE BY OTHER MANUFACTURERS DURING THAT TIME PERIOD. AS TO YOUR SUGGESTION THAT MIL T-21643A BE AMENDED AND USED, THE CONTRACTING OFFICER POINTS OUT THAT WHILE IT MAY BE SATISFACTORY IN OTHER RESPECTS IT CALLS FOR 3,000 POUNDS CAPACITY AND AN INCREASE IN THIS REGARD WOULD CALL FOR A COMMENSURATE PRICE INCREASE. CONCERNING THE LACK OF COMPETITION, THE CONTRACTING OFFICER POINTS OUT THAT THIS MAY HAVE RESULTED FROM THE FACT THAT ONLY ONE TRUCK WAS TO BE PROCURED.

AS TO YOUR CONTENTION THAT THIS PROCUREMENT SHOULD HAVE BEEN MADE ON A NEGOTIATED BASIS, THE CONTRACTING OFFICER NOTES THAT 41 U.S.C. 252(C) PROVIDES THAT ALL PURCHASES AND CONTRACTS SHALL BE MADE BY ADVERTISING, EXCEPT IN CERTAIN ENUMERATED CIRCUMSTANCES. SINCE NONE OF THE EXCEPTIONS PERMITTING NEGOTIATION WERE APPLICABLE, FORMAL ADVERTISING WAS REQUIRED BY STATUTE. SEE FPR 1-2.102(A), WHICH STATES THAT EVEN WHERE NEGOTIATION WOULD OTHERWISE BE PERMITTED UNDER ONE OF THE EXCEPTIONS, FORMAL ADVERTISING SHALL BE USED IF FEASIBLE AND PRACTICABLE UNDER THE EXISTING CIRCUMSTANCES.

WE HAVE HELD THAT AN AGENCY DOES NOT VIOLATE THE COMPETITIVE BIDDING STATUTES MERELY BECAUSE ONLY ONE FIRM CAN SUPPLY ITS NEEDS, SO LONG AS THE SPECIFICATIONS ARE REASONABLE AND NECESSARY FOR THE PURPOSE INTENDED. SEE B-170789, DECEMBER 14, 1970. ON THE OTHER HAND, WE HAVE DISAPPROVED THE USE OF A MILITARY SPECIFICATION RESTRICTING PROCUREMENT TO ONE SOURCE WHERE OTHER AVAILABLE COMPETITIVE ITEMS WILL MEET THE MINIMUM NEEDS OF THE PROCURING ACTIVITY. SEE 47 COMP. GEN. 12, 19 (1967). IN VIEW OF YOUR CONTENTIONS CONCERNING THE USE OF MIL-T 21643A, WE ARE ADVISING THE SECRETARY OF HEALTH, EDUCATION, AND WELFARE THAT IN ANY FUTURE PROCUREMENTS OF THE SUBJECT FORK LIFT TRUCK CONSIDERATION SHOULD BE GIVEN TO THE USE OF SPECIFICATIONS WHICH PERMIT BIDS ON OTHER AVAILABLE COMPETITIVE TRUCKS COMPATIBLE WITH THE NEEDS OF THE USING ACTIVITY.

HOWEVER, WE ARE NOT PREPARED TO DISTURB THE AWARD AS YOU SUGGEST. WHILE WE BELIEVE THAT UNDULY RESTRICTIVE MILITARY SPECIFICATIONS SHOULD NOT BE USED FOR COMPETITIVE PROCUREMENT PURPOSES, WE DO NOT CONCLUDE THAT THE AWARD MADE IN THIS CASE WAS SO PLAINLY OR PALPABLY ILLEGAL AS TO REQUIRE ITS CANCELLATION. 50 COMP. GEN. 679, 685 (1971). THE RECORD INDICATES THAT THE CONTRACTING OFFICER USED THE SPECIFICATION IN QUESTION IN GOOD FAITH, RELYING ON FPR 1-1.305-6, AND THAT THE CONTRACTOR ACCEPTED THE CONTRACT IN GOOD FAITH.