Protest Involving Two-Step Procurement

American Telephone and Telegraph Company protested the rejection of a bid submitted by its subsidiary in the second step of a two-step advertised procurement for a telephone system for the Veterans Administration. The step-one request for proposals encouraged offerors to submit multiple proposals presenting different basic approaches. The offeror, misunderstanding the procedures in two-step advertising, believed that it was permissible to discuss in step two whether use of the equipment in a manner which varied from specifications was acceptable. GAO held that this question could not be carried over into step two of the procurement, and the protest was therefore denied.