B-181116, NOV 7, 1974

B-181116: Nov 7, 1974

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

IS PROPERLY FUNCTION OF PROCURING AGENCY. REFUSAL OF ARMY TO AMEND SPECIFICATION SO AS TO PERMIT ACCEPTANCE OF PROTESTER'S PRODUCT WAS NOT UNREASONABLE OR CONTRARY TO PRIOR GAO DECISION RECOMMENDING CONSIDERATION OF SUCH ACTION SINCE UPON CONSIDERATION IT WAS DETERMINED THAT PROTESTER'S PRODUCT WOULD NOT MEET AGENCY'S NEEDS. INVOLVING THE SAME SPECIFICATION IN A PRIOR PROCUREMENT WAS UNDULY RESTRICTIVE OF COMPETITION. AS STATED IN ORU PREVIOUS DECISION: "*** ITS MILK IS PASTEURIZED AT AN 'ULTRAHIGH' TEMPERATURE OF 280 DEGS. WHICH IS CONSIDERABLY ABOVE NORMAL PASTEURIZATION TEMPERATURE. THE MILK IS THEN 'INCUBATED' FOR A PERIOD OF 96 HOURS FOR "BACTERIOLOGICAL COUNT' AND CHECKING. *** THIS METHOD OF PASTEURIZATION.

B-181116, NOV 7, 1974

UNDER WELL-SETTLED RULE THAT DRAFTING OF SPECIFICATIONS TO MEET GOVERNMENT'S MINIMUM NEEDS, AS WELL AS DETERMINATION OF WHETHER ITEMS OFFERED MEET SPECIFICATIONS, IS PROPERLY FUNCTION OF PROCURING AGENCY, REFUSAL OF ARMY TO AMEND SPECIFICATION SO AS TO PERMIT ACCEPTANCE OF PROTESTER'S PRODUCT WAS NOT UNREASONABLE OR CONTRARY TO PRIOR GAO DECISION RECOMMENDING CONSIDERATION OF SUCH ACTION SINCE UPON CONSIDERATION IT WAS DETERMINED THAT PROTESTER'S PRODUCT WOULD NOT MEET AGENCY'S NEEDS.

STAYFRESH PROCESSING CORPORATION:

THIS PROTEST INVOLVES A CONTENTION BY STAYFRESH PROCESSING CORPORATION THAT THE ARMY'S FAILURE TO AMEND A SPECIFICATION IN A SOLICITATION FOR MILK AND DAIRY PRODUCTS PURSUANT TO OUR DECISION B 179704, APRIL 12, 1974, INVOLVING THE SAME SPECIFICATION IN A PRIOR PROCUREMENT WAS UNDULY RESTRICTIVE OF COMPETITION.

AS BACKGROUND, IN SEPTEMBER OF 1973, STERILE FOOD PRODUCT. INCORPORATED (STERILE FOOD), NOW OPERATING AS STAYFRESH PROCESSING CORPORATION (STAYFRESH), PROTESTED AWARD UNDER TWO INVITATIONS FOR BIDS (IFBS) (DAFA03 -74-B-0004 AND DAFA03-74-B-0011), ISSUED BY THE PROCUREMENT DIVISION, FORT RICHARDSON, ALASKA, FOR MILK AND DAIRY PRODUCTS. SECTION F-1(A) OF THE IF STATED THAT THE MILK SUPPLIED SHOULD COMPLY WITH FEDERAL SPECIFICATION NUMBER C-M-1678, FEBRUARY 29, 1972, WHICH, AS AMENDED, PROVIDES AT PARAGRAPH 3.4 AS FOLLOWS:

"3.4 AGE OF PRODUCT. THE FINISHED PRODUCT, EXCEPT TYPE IV, SHALL BE DELIVERED WITHIN 72 HOURS AFTER DATE OF PASTEURIZATION."

STERILE FOOD REQUESTED A WAIVER OF THIS REQUIREMENT BECAUSE IT WOULD BE UNABLE TO MEET THE 72-HOUR TIME LIMIT DUE TO ITS PARTICULAR METHOD OF PASTEURIZATION. ACCORDING TO OFFICIALS FROM STERILE FOOD, AS STATED IN ORU PREVIOUS DECISION:

"*** ITS MILK IS PASTEURIZED AT AN 'ULTRAHIGH' TEMPERATURE OF 280 DEGS. F., WHICH IS CONSIDERABLY ABOVE NORMAL PASTEURIZATION TEMPERATURE. THE MILK IS THEN 'INCUBATED' FOR A PERIOD OF 96 HOURS FOR "BACTERIOLOGICAL COUNT' AND CHECKING. *** THIS METHOD OF PASTEURIZATION; AND THE PACKAGING OF THE MILK IN ASEPTICALLY LINED MILK CARTONS RESULTS IN MILK AND MILK PRODUCTS HAVING A MUCH LONGER SHELF LIFE, BOTH REFRIGERATED AND UNREFRIGERATED, THAN MILK PASTEURIZED BY THE ORDINARY METHOD. STERILE FOOD GUARANTEES A SHELF LIFE OF 12 WEEKS BEFORE THE MILK SPOILS, A CONSIDERABLY LONGER PERIOD OF TIME THAN MILK PASTEURIZED BY THE ORDINARY METHOD. (STERILE FOOD) CLAIMS THAT SINCE ITS MILK HAS A ZERO BACTERIAL COUNT AFTER PASTEURIZATION, UNLIKE MILK PASTEURIZED BY THE ORDINARY METHOD, IT IS PRODUCING A MILK OF HIGHER QUALITY THAN MILK WHICH IS PASTEURIZED BY THE ORDINARY METHOD AND WHICH MEETS THE REQUIREMENT OF SECTION 3.4. STERILE FOOD WOULD SHIP THE MILK FROM WASHINGTON TO ALASKA BY BARGE, WHICH TAKES APPROXIMATELY 5 OR 6 DAYS. THEREFORE, IT WOULD NEED APPROXIMATELY 9 DAYS FROM THE TIME OF PASTEURIZATION TO GET THE MILK TO THE ARMY INSTALLATION IN ALASKA."

THE ARMY CONTRACTING OFFICIALS DENIED STERILE FOOD'S REQUEST TO WAIVE THE 72-HOUR TIME LIMIT. STERILE FOOD THEN PROTESTED TO THIS OFFICE, CLAIMING THAT THE REQUIREMENT FOR DELIVERY OF MILK WITHIN 72 HOURS OF PASTEURIZATION EXCLUDED MILK PRODUCTED BY STERILE FOOD AND WAS UNDULY RESTRICTIVE OF COMPETITION. IN B-179704, APRIL 12, 1974, WE STATED THAT THE SUBJECT SPECIFICATION, C-M-1678, WAS MANDATORY UNDER ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1-1202, AND THEREFORE, THE CONTRACTING OFFICER PROPERLY DECLINED TO WAIVE ITS APPLICABILITY WITH RESPECT TO STERILE FOOD. HOWEVER, WE FURTHER STATED THAT:

"*** THERE IS EVIDENCE THAT THE MILK SUPPLIED BY STERILE FOOD, BECAUSE OF THE HIGH TEMPERATURE PASTEURIZATION AND THE ASEPTICALLY LINED MILK CARTONS, MEETS OR EXCEEDS THE QUALITY REQUIREMENTS WHICH FEDERAL SPECIFICATION C-M-1678 IS DESIGNED TO INSURE AND HAS A LONGER THAN CUSTOMARY SHELF LIFE.

"IN THE CIRCUMSTANCES, THE 72 HOUR DELIVERY REQUIREMENT MAY REPRESENT AN UNDUE RESTRICTION ON COMPETITION. WE ARE THEREFORE RECOMMENDING THAT THE PROCURING ACTIVITY GIVE CONSIDERATION TO AMENDING THE SPECIFICATION PRIOR TO ANY FURTHER PROCUREMENTS SO AS TO OBTAIN MAXIMUM COMPETITION CONSISTENT WITH THE GOVERNMENT'S NEEDS."

ON APRIL 8, 1974, FOUR DAYS BEFORE THE ABOVE-CITED DECISION WAS RENDERED, THE PROCUREMENT DIVISION, FORT RICHARDSON, ALASKA, ISSUED SOLICITATION NO. DAFA03-74-R-0118 FOR MILK AND DAIRY PRODUCTS. UPON RECEIPT OF THE GAO DECISION, AND BEFORE BID OPENING, COUNSEL FOR STAYFRESH (SUCCESSOR TO THE INTERSTS OF STERILE FOOD) NOTIFIED THE CONTRACTING OFFICER OF THE DECISION AND REQUESTED THAT THE SPECIFICATION BE IMMEDIATELY AMENDED TO ALLOW STAYFRESH TO SUBMIT A BID THAT WOULD BE RESPONSIVE TO THE SOLICITATION. THE CONTRACTING OFFICER REFUSED TO AMEND THE SPECIFICATION BECAUSE OF LACK OF AUTHORITY. THEREAFTER, COUNSEL FOR STAYFRESH PROTESTED TO OUR OFFICE BEFORE AWARD CLAIMING THAT THE ARMY'S FAILURE TO AMEND THE SPECIFICATION AFTER KNOWLEDGE OF OUR DECISION B-179704, APRIL 12, 1974, WAS ARBITRARY, CAPRICIOUS AND UNDULY RESTRICTIVE OF COMPETITION.

THE ARMY CONTENDS THAT THE CONTRACTING OFFICER WAS REQUIRED BY ASPR 1 1202 AND ARMY PROCUREMENT PROCEDURE (APP) 1-202 TO USE THE SPECIFICATION AND HAD NO AUTHORITY TO INDEPENDENTLY MODIFY IT. SINCE THE SOLICITATION WAS "ON THE STREET" AT THE DATE ON WHICH OUR DECISION WAS ISSUED AND SINCE THERE WAS AN URGENT NEED FOR THE MILK, AWARD WAS MADE. THE ARMY REPORTS, HOWEVER, THAT THEREAFTER AND IN COMPLIANCE WITH OUR RECOMMENDATION IN B- 179704, APRIL 12, 1974, THE SPECIFICATION WAS REVIEWED BY ITS NATICK LABORATORIES, WHICH IS RESPONSIBLE FOR THE SPECIFICATION. HAVING CONSIDERED THE LABORATORIES' FINDINGS, THE ARMY CONCLUDED THAT THE NEED TO PROVIDE ITS PERSONNEL WITH "FRESH" MILK WHENEVER AVAILABLE DICTATED RETAINING THE 72-HOUR DELIVERY REQUIREMENT. THE ARMY EXPLAINS THAT:

"THIS NEED IS BASED UPON TROOP WELFARE REQUIREMENTS AND AN OBVIOUS PREFERENCE BY TROOPS FOR WHOLE, FRESH MILK. THERE IS ALSO EVIDENCE THAT STAYFRESH'S PRODUCT DOES VARY IN TASTE FROM THAT OF WHOLE, FRESH MILK. THE DETERMINATION THAT THE NEEDS OF THE ARMY PREVENT MODIFICATION OF THE SPECIFICATION IS BASED UPON VARIOUS FACTORS, SOME AFOREMENTIONED, THAT ARE REASONABLE. IT REFLECTS THE DEPARTMENT'S ACTUAL NEEDS ***."

STAYFRESH CHALLENGES THE ARMY'S CONCLUSION STATING THAT IT:

"*** IS SUPPLYING 'WHOLE, FRESH MILK'. IT IS NOT RECOMBINED, RECONSTITUTED OR ADULTERATED MILK. THE MILK SOURCE IS RAW, FRESH GRADE A MILK, INSPECTED BY APPROPRIATE STATE AND FEDERAL AUTHORITIES, EXACTLY THE SAME AS ANY OTHER GRADE A FRESH MILK. THE DIFFERENCE IS THAT THE MILK SUPPLIED BY STERILE FOOD PRODUCTS, INC. (STAYFRESH PROCESSING) IS PASTEURIZED AT A HIGHER TEMPERATURE UNDER ASEPTIC CONDITIONS TO ELIMINATE ALL BACTERIA AND COLIFORM."

IN RESPONSE TO FURTHER INQUIRY BY THIS OFFICE INTO THE BASIS FOR THE DEPARTMENT OF THE ARMY'S DETERMINATION NOT TO EXTEND THE DELIVERY TIME REQUIREMENT OF SPECIFICATION C-M-1678, WE HAVE BEEN ADVISED THAT WHILE NATICK LABORATORIES MAY HAVE FOUND MILK PRODUCED UNDER THE STAYFRESH ULTRA -HIGH TEMPERATURE PASTEURIZATION PROCESS TO BE BACTERIOLOGICALLY AND, IN GENERAL, PHYSICALLY INDISTINGUISHABLE FROM REGULARLY PASTEURIZED MILK, ITS PRODUCT NONETHELESS HAS A PARTICULAR FLAVOR ASSOCIATED GENERALLY WITH ULTRA-HIGH TEMPERATURE PASTEURIZATION. IN FACT, STAYFRESH CONCEDES THAT ITS MILK DOES HAVE A "SOMEWHAT COOKED FLAVOR", ALTHOUGH IT MAINTAINS THAT ITS TRADE SECRET METHOD OF ULTRA HIGH TEMPERATURE PASTEURIZATION HAS ENABLED IT TO PRODUCE MILK THAT DOES NOT HAVE A "DEFINITE COOKED FLAVOR."

STAYFRESH'S ATTEMPT TO CHARACTERIZE THE FLAVOR OF ITS MILK AS "SOMEWHAT" RATHER THAN "DEFINITELY" COOKED APPEARS TO BE MADE FOR THE PURPOSE OF ESTABLISHING THAT ITS MILK MEETS THE REQUIREMENT OF PARAGRAPH 3.3.1 OF THE SPECIFICATION THAT THE MILK NOT HAVE AN "UNNATURAL OR DEFINITE COOKED" FLAVOR.

IN REGARD TO THE PHYSICAL CHARACTERISTIC REQUIREMENTS, THE FIRST TWO SENTENCES OF PARAGRAPH 3.3.1 PROVIDE:

"3.3.1 PHYSICAL REQUIREMENTS. THE FINISHED PRODUCT SHALL POSSESS A FRESH SWEET, PLEASING, DESIRABLE FLAVOR AND SHALL BE NORMAL FOR THE SPECIFIC TYPE INVOLVED. THERE SHALL BE NO OBJECTIONABLE OR FOREIGN FLAVOR, ODOR AND COLOR SUCH AS OXIDIZED, TALLOWY, RANCID, BITTER METALLIC, FISHY, SOUR, STALE, UNNATURAL OR DEFINITE COOKED ***."

WE READ THOSE SENTENCES AS REQUIRING THAT THE PRODUCT TASTE LIKE THE FRESH MILK TO WHICH THE PUBLIC IS ACCUSTOMED AND FINDS ACCEPTABLE.

WHILE THERE MAY BE SOME DISPUTE AS TO THE PARTICULAR CHARACTERIZATION OF THE TASTE QUALITY OF STAYFRESH'S MILK PRODUCT, THERE APPEARS TO BE NO DISPUTE AS TO THE FACT THAT ITS TASTE IS DISTINGUISHABLE FROM THAT OF REGULARLY PASTEURIZED MILK TO WHICH THE PUBLIC IS GENERALLY ACCUSTOMED. THUS, THE ARMY'S REASON FOR RETAINING THE 72-HOUR DELIVERY REQUIREMENT OF PARAGRAPH 3.4 OF THE SEPCIFICATION RELATES PRIMARILY TO THE TASTE REQUIREMENT OF PARAGRAPH 3.3.1. THE ARMY HAS CONCLUDED THAT THE PRESENT STATE OF THE ART ULTRA-HIGH TEMPERATURE PASTEURIZATION FALLS SHORT OF PRODUCING A NORMAL MILK FLAVOR. GIVEN THIS FINDING, TOGETHER WITH THE FACT THAT REGULARLY PASTEURIZED MILK MUST BE DELIVERED WITHIN 72 HOURS OF PASTEURIZATION TO ASSURE ADEQUATE FRESHNESS, WE ARE UNABLE TO CONCLUDE THAT THE ARMY'S DETERMINATION TO RETAIN THE 72 HOURS DELIVERY REQUIREMENT IS WITHOUT A REASONABLE BASIS.

AS WE STATED IN OUR PREVIOUS DECISION IN THIS MATTER:

"IT CONSISTENTLY HAS BEEN HELD BY THIS OFFICE THAT THE DRAFTING OF SPECIFICATIONS TO MEET THE GOVERNMENT'S MINIMUM NEEDS, AS WELL AS THE DETERMINATION OF WHETHER ITEMS OFFERED MEET THE SPECIFICATIONS, IS PROPERLY THE FUNCTION OF THE PROCURING AGENCY, AND OUR OFFICE WILL NOT SUBSTITUE ITS JUDGMENT FOR THAT OF THE PROCURING AGENCY UNLESS SUCH DETERMINATION IS ARBITRARY OR CLEARLY ERRONEOUS. SEE 52 COMP. GEN. 393, 399 (1972); 49 COMP. GEN. 195 (1969) ***."

AS TO STAYFRESH'S SUGGESTION THAT A SIMILARLY UNUSUAL, COOKED OR OTHERWISE UNNATURAL FLAVOR IS SOMETIMES ASSOCIATED WITH MILK PASTEURIZED AT THE HIGH TEMPERATURE RANGE OF THE REGULAR PASTEURIZATION PROCESS, WE ASSUME THAT SUCH MILK WOULD FAIL TO MEET THE PHYSICAL CHARACTERISTICS REQUIREMENT OF PARAGRAPH 3.3.1 OF THE SPECIFICATION AND WOULD THEREFORE BE UNACCEPTABLE NOTWITHSTANDING THAT IT MIGHT MEET THE 72-HOUR DELIVERY REQUIREMENT.

SINCE WE ARE UNABLE TO CONCLUDE THAT THE DEPARTMENT OF THE ARMY'S DETERMINATION TO RETAIN THE 72-HOUR DELIVERY REQUIREMENT IS ARBITRARY OR OTHERWISE ERRONEOUS, WE ARE WITHOUT A BASIS TO FIND ITS REFUSAL TO MODIFY THE DELIVERY REQUIREMENT OF THE SPECIFICATION IMPROPER. ACCORDINGLY, THE PROTEST IS DENIED.