B-179263, APR 17, 1974

B-179263: Apr 17, 1974

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DETERMINATION WHETHER PROPOSAL IS WITHIN COMPETITIVE RANGE. IS MATTER OF ADMINISTRATIVE DISCRETION WHICH WILL NOT BE DISTURBED ABSENT CLEAR SHOWING OF ABUSE. WAS ISSUED BY THE UNITED STATES COAST GUARD HEADQUARTERS FOR DESIGN. THE TRANSFER AND STORAGE SUBSYSTEMS FOR ADAPTS ARE A 115. ADAPTS IS INTENDED FOR THE EMERGENCY OFFLOADING OF OIL OR OTHER POLLUTANT CARGOES FROM STRANDED OR DAMAGED TANKERS. THE CLOSING DATE FOR SUBMISSION OF PROPOSALS WAS SET FOR SEPTEMBER 25. ON THAT DATE OFFERS WERE RECEIVED FROM PIONEER PARACHUTE COMPANY. THE INITIAL EVALUATION OF THE TECHNICAL AND MANAGEMENT PROPOSALS OF BOTH OFFERORS WAS COMPLETED BY THE TECHNICAL REVIEW TEAM. THE INITIAL EVALUATION DID NOT INCLUDE RESULTS OF TESTING OF SAMPLES THAT WERE REQUIRED TO BE SUBMITTED WITH PROPOSALS.

B-179263, APR 17, 1974

PROPOSAL TO SUPPLY CONTAINER ASSEMBLIES AND AIR DELIVERY EQUIPMENT PROPERLY REJECTED AS NOT WITHIN COMPETITIVE RANGE WHERE IT FAILED TO COMPLY WITH SEVERAL SPECIFICATION TESTING REQUIREMENTS DETERMINED NECESSARY TO MEET COAST GUARD'S MINIMUM NEEDS AND FAILED TO SHOW THAT OFFERED CONTAINER ASSEMBLIES WOULD MEET PERFORMANCE SPECIFICATIONS. DETERMINATION WHETHER PROPOSAL IS WITHIN COMPETITIVE RANGE, EITHER AS INITIALLY SUBMITTED OR AS REVISED, IS MATTER OF ADMINISTRATIVE DISCRETION WHICH WILL NOT BE DISTURBED ABSENT CLEAR SHOWING OF ABUSE. MOREOVER, PRICE NEED NOT BE CONSIDERED WHEN UNACCEPTABLE TECHNICAL PROPOSAL INVOLVED. 52 COMP. GEN. 198 (1972); ID. 382 (1972).

TO PIONEER PARACHUTE CO., INC.:

ON AUGUST 14, 1972, REQUEST FOR PROPOSALS (RFP) NO. CG-30, 363-A, WAS ISSUED BY THE UNITED STATES COAST GUARD HEADQUARTERS FOR DESIGN, TESTING, AND PRODUCTION OF CONTAINER ASSEMBLIES AND AIR DELIVERY EQUIPMENT TO BE USED IN THE PRELIMINARY OPERATIONAL DEPLOYMENT OF THE AIR DELIVERABLE ANTI -POLLUTION TRANSFER SYSTEM (ADAPTS). THE TRANSFER AND STORAGE SUBSYSTEMS FOR ADAPTS ARE A 115,000 GALLON SEAWORTHY, COLLAPSIBLE, ELASTOMERIC-COATED CONTAINER AND AN AIR DELIVERY CONTAINER AND PARACHUTES. ADAPTS IS INTENDED FOR THE EMERGENCY OFFLOADING OF OIL OR OTHER POLLUTANT CARGOES FROM STRANDED OR DAMAGED TANKERS. THE CLOSING DATE FOR SUBMISSION OF PROPOSALS WAS SET FOR SEPTEMBER 25, 1972. ON THAT DATE OFFERS WERE RECEIVED FROM PIONEER PARACHUTE COMPANY, WITH UNIROYAL, INC. AS PROPOSED SUBCONTRACTOR, AND GOODYEAR TIRE AND RUBBER COMPANY. ON OCTOBER 20, 1972, THE INITIAL EVALUATION OF THE TECHNICAL AND MANAGEMENT PROPOSALS OF BOTH OFFERORS WAS COMPLETED BY THE TECHNICAL REVIEW TEAM. THE EVALUATION, WHILE NOTING THE SUPERIORITY OF THE GOODYEAR PROPOSAL, DETERMINED BOTH PROPOSALS TO BE ACCEPTABLE FOR FURTHER CONSIDERATION. THE INITIAL EVALUATION DID NOT INCLUDE RESULTS OF TESTING OF SAMPLES THAT WERE REQUIRED TO BE SUBMITTED WITH PROPOSALS. NEGOTIATIONS WERE CONDUCTED WITH BOTH OFFERORS BETWEEN OCTOBER 31, 1972 AND NOVEMBER 3, 1972, WITH TECHNICAL DISCUSSIONS TAKING PLACE WITH PIONEER ON NOVEMBER 2 AND 3, 1972. THE BEST AND FINAL OFFER DUE DATE WAS ESTABLISHED AS DECEMBER 21, 1972.

AFTER THE RECEIPT OF REVISED PROPOSALS AND CLOSING OF NEGOTIATIONS A FINAL EVALUATION OF TECHNICAL AND MANAGEMENT PROPOSALS WAS CONDUCTED BY THE TECHNICAL REVIEW TEAM AND ITS REPORT WAS COMPLETED ON DECEMBER 26, 1972. THIS FINAL TECHNICAL REVIEW INCLUDED CONSIDERATION OF THE TEST RESULTS OF THE FABRIC AND SEAM CONSTRUCTION SAMPLES AS REQUIRED BY THE TECHNICAL PORTION OF THE RFP. THE TECHNICAL REVIEW TEAM CONCLUDED THAT THE CONTAINER CONSTRUCTION METHODS PROPOSED BY PIONEER/UNIROYAL WOULD NOT MEET THE PERFORMANCE REQUIREMENTS OF THE SPECIFICATIONS AND THAT, THEREFORE, THE PROPOSAL WAS TECHNICALLY UNACCEPTABLE. THE SOURCE EVALUATION BOARD (SEB) IN ITS REPORT DATED FEBRUARY 22, 1973, CONCURRED WITH THE DETERMINATION MADE BY THE TECHNICAL REVIEW TEAM. THE SEB REPORT WAS PRESENTED TO THE SOURCE SELECTION OFFICIAL WHO DETERMINED THAT ONLY GOODYEAR WAS WITHIN THE TECHNICAL COMPETITIVE RANGE. PIONEER WAS ADVISED BY LETTER DATED MARCH 28, 1973, THAT IT WAS NOT WITHIN THE TECHNICAL COMPETITIVE RANGE AND HAD BEEN ELIMINATED FROM FURTHER CONSIDERATION. AWARD WAS MADE TO GOODYEAR ON JUNE 29, 1973.

PIONEER PROTESTS THIS AWARD BASICALLY ON THE GROUND THAT SINCE ITS PROPOSAL MET THE TECHNICAL REQUIREMENTS OF THE SPECIFICATIONS AND ITS COST PROPOSAL ON THE FIXED PRICE CONTRACT CONTEMPLATED WAS LOW, THE PROCURING ACTIVITY WAS OBLIGATED TO AWARD IT THE CONTRACT. IN THIS CONNECTION, PIONEER CONTENDS THAT THE PERFORMANCE SPECIFICATIONS DID NOT CONTAIN "BASE LINE" OR MINIMUM ACHIEVEMENT LEVELS FOR ACCEPTABILITY. THEREFORE, IT IS CONTENDED THAT "WHATEVER RESULTS MIGHT HAVE BEEN DERIVED DURING SAMPLE EVALUATION WERE TO BE UTILIZED AS MINIMUM VALUES IN THE FINAL PERFORMANCE OF END ITEMS ***." PIONEER CONTENDS THAT THE DETERMINATION THAT ITS TECHNICAL PROPOSAL WAS UNACCEPTABLE WAS BASED ON ALLEGED DEFICIENCIES THAT WERE ACTUALLY FAILURES OF PIONEER'S DESIGN TO MEET THE COAST GUARD'S UNDISCLOSED DESIGN PREFERENCES, RATHER THAN A FAILURE TO MEET THE RFP REQUIREMENTS. IT IS ALSO CONTENDED THAT THE TESTING OF SAMPLES WAS INVALID, PRIMARILY BECAUSE SUCH TESTS SHOULD NOT BE USED TO PREDICT SPECIFIC TENSILE VALUES AFTER AGING OR DISINTEGRATION BUT ONLY AS COMPARATIVE INDICATORS BETWEEN PRODUCTS. FINALLY, PIONEER CONTENDS THAT THE SPECIFICATIONS FAVORED GOODYEAR.

AS EXPLAINED BELOW, WE DO NOT AGREE WITH THESE CONTENTIONS.

THE RFP PROVIDED FOR EVALUATION OF PROPOSALS ON THE BASIS OF TECHNICAL, MANAGEMENT, AND COSTS CONSIDERATIONS WITH TECHNICAL MERIT BEING ASSIGNED A WEIGHT OF 70 PERCENT COMPARED TO 30 PERCENT FOR MANAGEMENT. TECHNICAL MERIT WAS TO BE BASED UPON ASSESSMENT OF (1) CONTAINER ASSEMBLY STRENGTH, (2) PROPOSED CONSTRUCTION METHODS, (3) DESIGN FEATURES, AND (4) ENGINEERING EXPERIENCE. THE RFP ALSO PROVIDED THAT THE OFFEROR MUST EXPLAIN IN DETAIL HOW HE PROPOSED TO MEET THE COAST GUARD SPECIFICATIONS AND DRAWINGS FOR BOTH THE CONTAINER ASSEMBLIES AND THE AIR DELIVERY EQUIPMENT, INCLUDED IN THE SOLICITATION. THE SPECIFICATIONS FOR BOTH THE CONTAINER ASSEMBLIES AND THE AIR DELIVERY EQUIPMENT CONTAIN DETAILED DESIGN AND PERFORMANCE REQUIREMENTS, INCLUDING MINIMUM AND MAXIMUM PARAMETERS FOR MANY OF THE PERFORMANCE REQUIREMENTS. THE RFP ALSO ADVISED OFFERORS THAT IN DETERMINING PROPOSAL ACCEPTABILITY PARTICULAR EMPHASIS WOULD BE PLACED ON RESPONSES TO SPECIFICATION PARAGRAPHS 3.3, 3.4, 3.5, AND 3.6. THE RFP REQUIRED THAT PROPOSALS INCLUDE TEST DATA FOR THE COATED FABRIC, UNCOATED FABRIC, COATING COMPOUNDS, AND SEAM CONSTRUCTION PROPOSED TO BE USED IN THE CONTAINER ASSEMBLIES. IN ADDITION, OFFERORS WERE REQUIRED TO SUBMIT SAMPLES OF THE ABOVE MATERIALS FOR COMPARATIVE GOVERNMENT TESTING.

AS NOTED ABOVE, THE INITIAL TECHNICAL EVALUATION WAS BASED UPON THE OFFERORS' RESPONSES TO THE RFP WITHOUT CONSIDERATION OF THE TEST DATA OR MATERIAL SAMPLES REQUIRED BY THE RFP. ALTHOUGH THE PROTESTER WAS DETERMINED TO BE WITHIN THE COMPETITIVE RANGE, THE FOUR EVALUATORS ASSIGNED A NUMERICAL SCORE OF 77 (OUT OF A POSSIBLE 100) TO ITS MANAGEMENT AND TECHNICAL PROPOSALS AS COMPARED TO A NUMERICAL SCORE OF 91.75 FOR GOODYEAR. A NARRATIVE DESCRIPTION OF THE STRENGTH AND WEAKNESSES OF THE TWO PROPOSALS IS PROVIDED TO SUPPORT THE NUMERICAL SCORING. THE REPORT INCLUDES THE FOLLOWING SUMMARY OF THE CONCLUSIONS:

"UNIROYAL IS ASSESSED THREE MAJOR WEAKNESSES; THE ONE REGARDING DOME AND CONSTRUCTION MAY BE UNCORRECTABLE. IT SHOULD BE NOTED THAT A FINAL DETERMINATION OF UNIROYAL'S CAPABILITY TO PROVIDE SPRAY-COATED, SEWN SEAM DOME ENDS MUST AWAIT THE RECEIPT AND ANALYSIS OF DATA ON THEIR PROPOSED CONSTRUCTION. IN ADDITION TO THE MAJOR WEAKNESSES, UNIROYAL HAS EIGHT MINOR WEAKNESSES, AGAIN WITH ONE UNCORRECTABLE WEAKNESS ON THE FEATURE OF ADDITIONAL SEAMS. GOODYEAR HAS FOUR MINOR WEAKNESSES, ALL CORRECTABLE."

THE REPORT INCLUDED A LIST OF AREAS IN WHICH THE RESPECTIVE PROPOSALS REQUIRED IMPROVEMENT.

PURSUANT TO THIS REPORT, PIONEER WAS FURNISHED A LIST OF QUESTIONS TO ANSWER AND ADVISED TO SUBMIT THE REQUIRED TEST DATA AND SAMPLES. THEREAFTER, DISCUSSIONS WERE HELD. SAMPLES OF THE PROPOSED CONTAINER CONSTRUCTION FROM THE OFFERORS WERE TESTED BY AN ARMY TESTING FACILITY. AT THE CONCLUSION OF THESE PROCEDURES, REVISED PROPOSALS AND BEST AND FINAL OFFERS WERE REQUESTED AND SUBMITTED TO THE TECHNICAL REVIEW TEAM FOR FINAL EVALUATION. IN ITS REPORT DATED DECEMBER 26, 1972, TO THE SOURCE EVALUATION BOARD, THE TECHNICAL REVIEW TEAM CONCLUDED THAT PIONEER'S PROPOSED CONTAINER CONSTRUCTION METHODS DID NOT MEET THE PERFORMANCE REQUIREMENTS OF THE SPECIFICATIONS AND, IN THIS REGARD, REPORTED IN PART AS FOLLOWS:

"(1) COMPARING TEST VALUES FOR INITIAL SEAM PEEL ADHESION AND COATING ADHESION SHOWS THAT UNIROYAL STANDS A SIGNIFICANTLY HIGHER CHANCE OF SEAM OR COATING PEELING FAILURE THAN GOODYEAR. COMPARING SEWN SEAM PEEL RESISTANCE DATA SHOWS THAT GOODYEAR HAS 50% GREATER INITIAL RESISTANCE TO PEELING. COMPARING UNIROYAL'S LAP SEAM PEEL RESISTANCE TO GOODYEAR'S SEWN SEAM SHOWS NEARLY EQUAL VALUES; HOWEVER, THE TEST METHOD USED DOES NOT SHOW THE IMPORTANCE OF STITCHES IN STOPPING A COMPLETE SEAM FAILURE. COMPARING TEST VALUES FOR INITIAL COATING ADHESION SHOWS GOODYEAR MORE THAN 50% HIGHER THAN UNIROYAL'S BEST (SPREAD-COATED) VALUE, AND MORE THAN 200% HIGHER THAN UNIROYAL'S LOWEST (SPRAY-COATED) VALUE.

"(2) EXAMINING THESE SAME PARAMETERS AFTER EXPOSURE TO FUEL LEADS THE TEAM TO CONCLUDE IT WILL BE IMPOSSIBLE TO REUSE THE UNIROYAL CONTAINER ONCE IT HAS BEEN EXPOSED TO FUEL. THE TEST RESULTS INDICATE THAT THE UNIROYAL SEWN SEAMS, AFTER FOUR MONTHS STORAGE AT 70 DEGS F, WILL BE REDUCED TO 3 LB./IN. OF PEEL STRENGTH. AT THAT STRENGTH THE SEAM CAN BE PULLED APART BY HAND, A CONDITION WHICH CLEARLY CANNOT BE RISKED.

"(3) FINALLY, THE COMPLETE DEGRADATION EXHIBITED BY UNIROYAL'S COATING-TO -FABRIC BOND AFTER THE WATER SOAK OF THE SEAM SAMPLE AND THE FACT THAT THE COATING MATERIAL COMPLETELY DISINTEGRATED AFTER 8 MONTHS (TEST EQUIVALENT) IN WATER MEANS THAT IT WILL BE IMPOSSIBLE TO USE THE CONTAINER AFTER PROLONGED EXPOSURE TO WATER. IF WATER WERE TRAPPED INSIDE THE CONTAINER UPON DELIVERY (E.G. BY CONDENSATION), THIS COULD LEAD TO A FAILURE OF THE CONTAINER DURING ITS FIRST USE.

"3. ABILITY TO MEET SPECIFIED PERFORMANCE REQUIREMENTS. THE RFP AND SPECIFICATION EOE-2-239 PLACE STRONG EMPHASIS ON CONTAINER STRENGTH AND ON RELIABILITY OF CONSTRUCTION METHODS. MINIMUM FABRIC STRENGTH PARAMETERS WERE INTENTIONALLY NOT CLOSELY SPECIFIED TO AVOID INADVERTENTLY RESTRICTING A MANUFACTURER'S CHOICE OF FABRIC AND CONSTRUCTION TECHNIQUE. HOWEVER, OVERALL CONTAINER PERFORMANCE WAS CLEARLY SPELLED OUT IN SEVERAL AREAS. PROPOSAL DEFICIENCIES WITH RESPECT TO THE SPECIFIED PERFORMANCE REQUIREMENTS ARE AS FOLLOWS:

"A. INITIAL USE. THE SPECIFICATION REQUIRES, IN PART, THAT THE CONTAINER BE CAPABLE OF ONE YEAR'S STORAGE AT TEMPERATURES UP TO 160 DEGS F, FOLLOWED BY CONTINUOUS AT-SEA TOWING FOR 48 HOURS (PARAS. 3.3.6, 3.3.8 AND 6.6.1), AND SEVEN DAYS STORAGE OF OIL, INCLUDING DIESEL FUEL. FURTHERMORE, PARAGRAPHS 3.4.2 AND 3.6.2 EXPLICITLY REQUIRE THAT SEAMS WITHSTAND THE EFFECTS OF OILS AND WATER EXPOSURE, AND THE PEELING FORCES OF MOVING WATER; AND THAT COATING COMPOUNDS BE SUITABLE FOR USE WHEN IN CONTINUOUS CONTACT WITH WATER. THE UNIROYAL PROPOSAL IS CLEARLY UNSATISFACTORY ON THESE POINTS. SPECIFICALLY (SEE TABLE I), TEST VALUES FOR UNIROYAL COATING ADHESION, SEAM PEEL ADHESION, AND COATING COMPOUND STRENGTH, ALL AFTER EXPOSURE TO WATER AND FUEL, ARE, IN THE OPINION OF THE TEAM, UNACCEPTABLY LOW. EXPOSURE OF COATING S-15606 POLYESTER TO WATER DURING STORAGE COULD PRECLUDE THE USE OF THE CONTAINER.

"B. REUSE. THE SPECIFICATION IS CLEAR IN REQUIRING THE CONTAINER TO BE CAPABLE OF A SECOND USE AFTER CLEANING AND FURTHER STORAGE. IF DURING THE FIRST USE FUEL OR WATER GETS INTO THE FABRIC, IT WILL NOT BE POSSIBLE TO COMPLETELY REMOVE THE FUEL AND DRY THE WATER. THE SPECIFIED ONE YEAR'S STORAGE, AT TEMPERATURES UP TO 160 DEGS F WILL THEN RESULT IN A DRASTIC LOSS OF ADHESION IN THE UNIROYAL SEAMS AND COATING. THE WORST SITUATION WILL BE IN THE DOME SEAMS, WHERE FUEL WILL CAUSE AN 84% LOSS IN STRENGTH, TO THE POINT WHERE THE SEAM CAN BE PEELED APART BY HAND. AGAIN, IF COATING S-15606 IS EXPOSED TO WATER DURING STORAGE IT MAY NOT BE POSSIBLE TO USE THE CONTAINER.

"4. CONCLUSIONS AND RECOMMENDATION. DUE TO THE UNIQUE MISSION OF THE CONTAINER FAILURE IN USE WILL NOT RESULT IN MERE INCONVENIENCE OR DELAY - IT WILL CAUSE A COSTLY ENVIRONMENTAL DISASTER. THE TYPE OF FAILURE MOST LIKELY TO OCCUR IN THE UNIROYAL CONTAINER - SEAMS PEELING OPEN - WILL BE OF THE CATASTROPHIC TYPE, NOT SUBJECT TO ON-SCENE REPAIR OR CONTROL. FURTHERMORE, THE PROBLEM COULD NOT BE CORRECTED BY RETROFIT OR MODIFICATION TO CONTAINERS ALREADY BUILT. THE COST OF CLEANING UP THE SPILLED CONTENTS OF ONE CONTAINER IS ESTIMATED AT $600,000.00. A FAILURE OF ONE CONTAINER WOULD LIKELY LEAD TO THE SCRAPPING OF ALL SIMILAR CONTAINERS. IT IS THEREFORE RECOMMENDED THAT THE PIONEER PROPOSAL BE DECLARED TECHNICALLY NON-ACCEPTABLE BECAUSE OF UNIROYAL'S PROPOSED CONSTRUCTION METHODS."

THE DETERMINATION OF WHETHER A PROPOSAL IS TECHNICALLY ACCEPTABLE AND WITHIN THE COMPETITIVE RANGE IS A MATTER OF ADMINISTRATIVE DISCRETION WHICH WILL NOT BE DISTURBED ABSENT A CLEAR SHOWING THAT THE DETERMINATION WAS ARBITRARY OR UNREASONABLE. 52 COMP. GEN. 382, 385 (1972). MOREOVER, WE HAVE UPHELD ADMINISTRATIVE DETERMINATIONS TO EXCLUDE FIRMS INITIALLY DETERMINED TO BE WITHIN THE COMPETITIVE RANGE FROM FURTHER AWARD CONSIDERATION AFTER THEIR REVISED PROPOSALS WERE FOUND TO BE TECHNICALLY UNACCEPTABLE AND NO LONGER WITHIN THE COMPETITIVE RANGE. 52 COMP. GEN. 198, 208 (1972).

PIONEER HAS STRESSED THE FACT THAT ITS PROPOSAL WAS LOW AS TO PRICE. HOWEVER, WE HAVE HELD THAT WHEN AN OFFEROR SUBMITS AN UNACCEPTABLE PROPOSAL, SUCH OFFEROR MAY BE EXCLUDED FROM THE COMPETITIVE RANGE WITHOUT REGARD TO ITS PROPOSED PRICE. 52 COMP. GEN. 382, 389, SUPRA. IN THE INSTANT CASE, ALTHOUGH PIONEER HAS MADE GENERAL ASSERTIONS AS TO THE TECHNICAL ACCEPTABILITY OF ITS PRODUCT, IT HAS FAILED TO PROVIDE A CONVINCING REBUTTAL TO THE SPECIFIC DEFICIENCIES IN ITS PROPOSAL CITED BY THE TECHNICAL REVIEW TEAM IN ITS TWO EVALUATION REPORTS REFERRED TO ABOVE. FURTHERMORE, THERE IS NOTHING IN THE RECORD TO SUPPORT THE CHARGE THAT PIONEER'S TECHNICAL UNACCEPTABILITY RESULTED FROM ITS FAILURE TO MEET THE COAST GUARD'S UNDISCLOSED DESIGN PREFERENCES RATHER THAN FROM ITS FAILURE TO MEET THE SPECIFIED RFP REQUIREMENTS. MOREOVER, NO EVIDENCE HAS BEEN PRESENTED TO SUPPORT THE CHARGE THAT THE SPECIFICATIONS WERE SO WRITTEN AS TO FAVOR GOODYEAR. ALSO, THE SAMPLES OF BOTH OFFERORS WERE SUBJECTED TO THE SAME TESTING PROCEDURES BY THE ARMY MOBILITY EQUIPMENT RESEARCH AND DEVELOPMENT CENTER AS PROVIDED IN THE RFP. THEREFORE, THE TESTING NOT ONLY PROVIDED A BISIS FOR PREDICTING PERFORMANCE OF EACH OFFEROR'S PRODUCT, BUT ALSO SERVED AS A COMPARATIVE INDICATOR OF THE RELATIVE MERIT OF EACH OFFEROR'S PRODUCT, AND WAS IN OUR VIEW A PROPER REQUIREMENT. IN THESE CIRCUMSTANCES, WE SEE NO BASIS FOR CONCLUDING THAT THE ADMINISTRATIVE DETERMINATION OF COMPETITIVE RANGE WAS ARBITRARY. ACCORDINGLY, THE PROTEST IS DENIED.