B-178426, FEB 25, 1974

B-178426: Feb 25, 1974

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WAS PROPER. SINCE REQUISITIONS HAVE UMMIPS 03 PRIORITY DESIGNATOR AND ASPR 3-202.2(VI) AUTHORIZES NEGOTIATION WHEN PURCHASE REQUEST CITES UMMIPS PRIORITY DESIGNATOR OF 1 THROUGH 6. ALSO RECORD DOES NOT INDICATE CONTRACTING OFFICER ACTED ARBITRARILY SINCE ADEQUATE DRAWINGS NECESSARY FOR COMPETITIVE PROCUREMENT WERE UNAVAILABLE AND COULD NOT BE PROVIDED IN TIME ALLOWED. N00123-73-C-1946 WAS AWARDED ON MARCH 26. HAS PROTESTED THE AWARD TO GK ALLEGING THAT ALTHOUGH ADEQUATE COMPETITION WAS AVAILABLE. THE CONTRACT WAS IMPROPERLY NEGOTIATED WITH GK. A & J ASSERTS THAT FAVORITISM AND COLLUSION WERE PRACTICED BY GOVERNMENT PERSONNEL DURING THE COURSE OF THIS PROCUREMENT AND THAT THE CONTRACT AWARD TO GK WAS VOID AS BEING BEYOND THE SCOPE OF AUTHORITY OF THE CONTRACTING OFFICER.

B-178426, FEB 25, 1974

PROCUREMENT OF KITS AND THEIR INSTALLATION INTO CABINETS DESTINED FOR USS ROBISON AND USS TOWERS, NEGOTIATED, PURSUANT TO "PUBLIC EXIGENCY" EXCEPTION, 10 U.S.C. 2304(A)(2), WITH COMPANY SUPPLYING CABINETS, AS SOLE SOURCE, WAS PROPER, SINCE REQUISITIONS HAVE UMMIPS 03 PRIORITY DESIGNATOR AND ASPR 3-202.2(VI) AUTHORIZES NEGOTIATION WHEN PURCHASE REQUEST CITES UMMIPS PRIORITY DESIGNATOR OF 1 THROUGH 6, ALSO RECORD DOES NOT INDICATE CONTRACTING OFFICER ACTED ARBITRARILY SINCE ADEQUATE DRAWINGS NECESSARY FOR COMPETITIVE PROCUREMENT WERE UNAVAILABLE AND COULD NOT BE PROVIDED IN TIME ALLOWED.

TO A & J MANUFACTURING CO.:

CONTRACT NO. N00123-73-C-1946 WAS AWARDED ON MARCH 26, 1973, TO GENERAL KINETICS, INC. (GK), ON A SOLE-SOURCE BASIS UNDER REQUISITIONS NOS. N60258 -3-008063 AND N60258-3-008065 ISSUED MARCH 8, 1973, AND MARCH 12, 1973, RESPECTIVELY, BY THE NAVAL PROCUREMENT OFFICE, LOS ANGELES, CALIFORNIA. THE CONTRACT REQUIRED GK TO FABRICATE ELECTRONICS EQUIPMENT INSTALLATION KITS AND TO INSTALL THEM INTO 24 ELECTRONIC ENVIRONMENTAL CABINETS, 12 EACH SCHEDULED FOR INSTALLATION BY LONG BEACH NAVAL SHIPYARD ON BOARD THE USS ROBISON (DDG-12) AND USS TOWERS (DDG-9).

THE A & J MANUFACTURING CO. (A & J), HAS PROTESTED THE AWARD TO GK ALLEGING THAT ALTHOUGH ADEQUATE COMPETITION WAS AVAILABLE, THE CONTRACT WAS IMPROPERLY NEGOTIATED WITH GK, ON A SOLE-SOURCE BASIS. FURTHERMORE, A & J ASSERTS THAT FAVORITISM AND COLLUSION WERE PRACTICED BY GOVERNMENT PERSONNEL DURING THE COURSE OF THIS PROCUREMENT AND THAT THE CONTRACT AWARD TO GK WAS VOID AS BEING BEYOND THE SCOPE OF AUTHORITY OF THE CONTRACTING OFFICER.

IN SUPPORT OF ITS PROTEST, A & J ARGUES THAT:

"THIS CONTRACT WAS AWARDED WITHOUT PUBLIC ADVERTISING PURSUANT TO THE PUBLIC EXIGENCY EXCEPTION SET FORTH IN ASPR 3-202. WITH REGARD TO THE USE OF THE AUTHORITY GRANTED BY THIS SECTION ASPR 3-202.2 DICTATES:

"'IN ORDER FOR THE AUTHORITY OF THIS PARAGRAPH 3-202 TO BE USED, THE NEED MUST BE COMPELLING AND OF UNUSUAL URGENCY, AS WHEN THE GOVERNMENT WOULD BE SERIOUSLY INJURED, FINANCIALLY OR OTHERWISE, IF THE SUPPLIES OR SERVICES WERE NOT FURNISHED BY A CERTAIN DATE, AND WHEN THEY COULD NOT BE PROCURED BY THAT DATE BY MEANS OF FORMAL ADVERTISING. WHEN NEGOTIATING UNDER THIS AUTHORITY, COMPETITION TO THE MAXIMUM EXTENT PRACTICABLE, WITHIN THE TIME ALLOWED, SHALL BE OBTAINED. THE FOLLOWING ARE ILLUSTRATIVE OF THE CIRCUMSTANCES WITH RESPECT TO WHICH THIS AUTHORITY MAY BE USED:

'(II) ESSENTIAL EQUIPMENT FOR, OR REPAIR TO, A SHIP WHEN SUCH EQUIPMENT REPAIR IS NEEDED AT ONCE FOR COMPLIANCE WITH THE ORDERS OF THE SHIP.'

"CONTRARY TO THE MANDATE OF THIS SECTION, THIS CONTRACT WAS 'NEGOTIATED' WITHOUT COMPETITION IN ANY FORM."

THE SUBJECT PROCUREMENT WAS NEGOTIATED UNDER THE "PUBLIC EXIGENCY" EXCEPTION, 10 U.S.C. 2304(A)(2). THE REQUISITIONING ACTIVITY RECOMMENDED NEGOTIATION BECAUSE THE MATERIAL WAS URGENTLY REQUIRED FOR INSTALLATION ON BOARD BOTH THE USS ROBISON AND USS TOWERS AND DELAY WOULD JEOPARDIZE THEIR SCHEDULED COMPLETION DATES. REQUISITIONS NOS. N60258-3-008063 AND N60258- 3-008065 HAVE A UNIFORM MATERIAL MOVEMENT AND ISSUE PRIORITY SYSTEM (UMMIPS) 03 PRIORITY DESIGNATOR. IN THIS CONNECTION, PARAGRAPH 3- 202.2(VI) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) PROVIDES FOR THE UTILIZATION OF THE AUTHORITY OF 10 U.S.C. 2304(A)(2) WHEN THE PURCHASE REQUEST CITES A UMMIPS PRIORITY DESIGNATOR OF 1 THROUGH 6. THUS THERE WAS A BASIS FOR THE CONTRACTING OFFICER UTILIZING THE EXIGENCY EXCEPTION.

AS A JUSTIFICATION FOR NEGOTIATING WITH GK ON A SOLE-SOURCE BASIS, THE CONTRACTING OFFICER REPORTS THAT AT THE TIME OF THE PROCUREMENT, ADEQUATE MANUFACTURING DRAWINGS NECESSARY FOR A COMPETITIVE PROCUREMENT WERE UNAVAILABLE AND THEY COULD NOT BE PROVIDED IN THE TIME ALLOWED. THE INSTALLATION KITS HAD TO BE FABRICATED TO MEET THE INTERNAL MEASUREMENTS OF THE CABINETS, AND THE "ALLO DIVISION" OF GK WAS ALREADY FURNISHING THE CABINETS PURSUANT TO ANOTHER CONTRACT. THUS THE CONTRACTING OFFICER DETERMINED THAT GK WAS THE ONE SOURCE CAPABLE OF PRODUCING THE INSTALLATION KITS WITHOUT DETAILED DRAWINGS. WE HAVE HELD THAT "WHERE THE LEGITIMATE NEEDS OF THE GOVERNMENT CAN BE SATISFIED FROM ONLY A SINGLE SOURCE, WE DO NOT THINK THE LAW REQUIRES THAT THEY BE COMPROMISED TO OBTAIN COMPETITION ***." B-172542(1), JULY 2, 1971. WHILE USE OF THE "PUBLIC EXIGENCY" EXCEPTION DOES NOT IN AND OF ITSELF CLOAK THE CONTRACTING OFFICER WITH AUTHORITY TO PROCURE ITEMS ON A NONCOMPETITIVE BASIS, HE IS VESTED WITH A CONSIDERABLE AMOUNT OF DISCRETION TO DETERMINE THE AMOUNT OF COMPETITION CONSISTENT WITH THE EXIGENCY SITUATION. 176919(1), APRIL 16, 1973. FURTHERMORE, OUR OFFICE WILL NOT QUESTION THE CONTRACTING OFFICER'S DECISION TO MAKE A SOLE-SOURCE AWARD UNLESS IT IS CLEAR FROM THE WRITTEN RECORD THAT HE ACTED IN AN ARBITRARY OR CAPRICIOUS MANNER IN ABUSE OF THAT DISCRETION. B-176919(1), APRIL 16, 1973; B- 174026, FEBRUARY 8, 1972; 44 COMP. GEN. 590 (1965).

FOR THE REASONS STATED ABOVE, WE ARE UNABLE TO CONCLUDE THAT THE CONTRACTING OFFICER ACTED ARBITRARILY OR CAPRICIOUSLY IN AWARDING THE CONTRACT TO GK ON A SOLE-SOURCE BASIS.

IN ITS PROTEST, A & J HAS ALSO ASSERTED THAT THE COURSE FOLLOWED IN THIS PROCUREMENT IS INDICATIVE OF FAVORITISM AND COLLUSIVE PRACTICES, WHICH ARE "*** EVINCED NOT ONLY BY THE FACT THAT THE CONTRACT WAS AWARDED WITHOUT COMPETITION, BUT ALSO BY THE FORM OF THE CONTRACT ITSELF, AND IN THE CLANDESTINE MANNER IN WHICH THIS PROCUREMENT WAS EFFECTED."

TO THE EXTENT THAT THIS ASSERTION OF FAVORITISM OR COLLUSION IS BASED UPON THE CONTENTION THAT THERE EXISTED NO BASIS FOR A SOLE-SOURCE NEGOTIATION, IT MUST FAIL FOR THE REASONS SET FORTH ABOVE.

AS TO THE FORM OF THE CONTRACT, A & J HAS ARGUED THAT:

"IT IS THE GENERAL RULE IN GOVERNMENT CONTRACTING THAT PARTS BE ORDERED ACCORDING TO FEDERAL DRAWINGS AND SPECIFICATIONS. IN THIS RESPECT, ASPR 1 -304.2(B)(1) PROVIDES;

"'WHERE PRACTICAL, PROCUREMENT SHALL BE COMPETITIVE USING PERFORMANCE OR OTHER SPECIFICATIONS, INCLUDING PURCHASE DESCRIPTIONS, WHICH DO NOT CONTAIN DATA DEVELOPED AT PRIVATE EXPENSE TO WHICH THE GOVERNMENT DOES NOT HAVE UNLIMITED RIGHTS. ...'

"KITS REQUIRED BY THIS CONTRACT ARE FOR THE INSTALLATION OF ELECTRONICS EQUIPMENT INTO ENVIRONMENTAL CABINETS. EACH PIECE OF ELECTRONICS EQUIPMENT IS DESIGNATED BY A FEDERAL IDENTIFICATION NUMBER AND THE INSTALLATION KITS THEREFORE ARE LIKEWISE IDENTIFIED. FOR INSTANCE, THE INSTALLATION KIT FOR THE AN/URC-9 TRANSCEIVER IS DESIGNATED BY FEDERAL NO. RE-F2683899 AND THE INSTALLATION KIT FOR THE ANTENNA CONTROL UNIT IS DESIGNATED C-6193/SRA-17C IS IDENTIFIED AS RE F2683906. HOWEVER, IN DISREGARD OF SUCH STANDARD PROCUREMENT PROCEDURE, THIS CONTRACT CALLS FOR INSTALLATION KITS TO BE PROVIDED ACCORDING NOT TO FEDERAL NUMBERS, BUT TO GENERAL KINETICS' ALLO METALS DIVISION PART NUMBERS. SUCH PART NUMBERS ARE NOT ORDINARILY AVAILABLE TO THE GOVERNMENT AND WOULD ONLY HAVE BEEN USED IF GOVERNMENT CONTRACTING PERSONNEL AND THE SUPPLIER, HEREIN GENERAL KINETICS' ALLO METALS DIVISION, HAD WORKED HAND IN HAND IN PREPARING AND EFFECTING THIS PROCUREMENT."

THE CONTRACTING OFFICER HAS STATED THAT THESE NUMBERS ARE CONTROL DRAWING NUMBERS, AND, ALTHOUGH THE DRAWINGS DO RELATE TO THE INSTALLATION KITS, THEY ARE NOT MANUFACTURING DRAWINGS AS WOULD BE REQUIRED FOR A COMPETITIVE PROCUREMENT.

WITH REGARD TO A & J'S ALLEGATION OF CLANDESTINE PROCUREMENT PRACTICES, IT STATES THAT:

"ALTHOUGH EVERY EFFORT WAS MADE TO OBTAIN INFORMATION AS TO THE EVENT OF THIS PROCUREMENT, AND ALTHOUGH ITS INTENTION TO BID ON THIS PROCUREMENT WAS CLEARLY EXPRESSED, A & J MANUFACTURING WAS NEVER INFORMED OF THIS PROCUREMENT AND WAS NEVER OFFERED THE OPPORTUNITY TO BID."

TO SUPPORT THIS ALLEGATION, A & J STATES THAT UPON LEARNING THE SUBJECT PROCUREMENT HAD BEEN INITIATED, IT CONTACTED MR. JIM TRUESDALE, THE SUPERVISOR OF PROCUREMENT AT NAVAL REGIONAL PROCUREMENT OFFICE, LOS ANGELES, THROUGHOUT FEBRUARY AND MARCH 1973 AND INQUIRED WHETHER ANY REQUESTS FOR PROPOSALS REGARDING THE PROCUREMENT HAD COME THROUGH FROM ELECTRONIC SUPPLY OFFICE. IN RESPONSE TO ITS INQUIRIES, A & J WAS INFORMED THAT NOTHING HAD BEEN ISSUED. FURTHERMORE, ON OR ABOUT MARCH 27, 1973, A & J REQUESTED MR. TRUESDALE TO CHECK FOR ANY PROCUREMENT FROM NAVAL REGIONAL PROCUREMENT OFFICE, LOS ANGELES, TO GK CONCERNING INSTALLATION KITS. ON OR ABOUT APRIL 5, 1973, A & J WAS INFORMED THAT TO THE BEST OF MR. TRUESDALE'S KNOWLEDGE NOTHING HAD BEEN ISSUED IN THIS RESPECT.

THE RECORD INDICATES THAT MR. TRUESDALE IS AT THE THIRD ECHELON BELOW THAT ASSUMED BY A & J, AND IS A FIRST-LINE SUPERVISOR. IT ALSO INDICATES THAT MR. TRUESDALE ADVISED THE A & J REPRESENTATIVE THAT THE ONLY POSSIBLE WAY HE WOULD HAVE OF TRACING SUCH A PROCUREMENT WOULD BE WITH A REQUISITION NUMBER OR THROUGH PERSONAL RECOLLECTION. SINCE THE REQUISITION HAD BEEN ASSIGNED TO A DIFFERENT SUPERVISOR, MR. TRUESDALE WAS NEVER PERSONALLY COGNIZANT OF THE PROCUREMENT. FURTHERMORE, MR. TRUESDALE HAS ADVISED THAT THE CALLER MENTIONED THE ELECTRONICS SUPPLY OFFICE ONLY IN PASSING, AND INDICATED THAT HE WAS INTERESTED IN A PROCUREMENT FOR ELECTRONICS EQUIPMENT CABINETS. THEREFORE, A & J WAS NEVER ADVISED OF THE INSTANT PROCUREMENT SIMPLY BECAUSE IT NEVER ASKED IN A FORMAT WHICH COULD BE ANSWERED WITHIN THE CAPABILITIES OF THE ORGANIZATION.

FINALLY, SINCE IT APPEARS THAT THE CONTRACT WAS ENTERED INTO IN CONFORMITY WITH THE APPLICABLE LAW, REGULATION, AND PROCEDURES, IT DOES NOT APPEAR TO HAVE BEEN BEYOND THE SCOPE OF THE CONTRACTING OFFICER'S AUTHORITY.

FOR THESE REASONS, THE PROTEST IS DENIED.