B-159469, B-160265, MAR. 22, 1967

B-159469,B-160265: Mar 22, 1967

Additional Materials:

Contact:

Ralph O. White
(202) 512-8278
WhiteRO@gao.gov

Kenneth E. Patton
(202) 512-8205
PattonK@gao.gov

 

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

TO BALDWIN-LIMA-HAMILTON CORPORATION: REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 17. IFB-151-642-6 WHICH WAS STEP TWO IN THE TWO-STEP FORMAL ADVERTISING METHOD USED FOR THE PROCUREMENT. THE PROPELLER SYSTEMS ARE TO BE INSTALLED IN THREE TANK LANDING SHIP VESSELS (LST NOS. 1179-1181). COMPLETE CONTROLLABLE PITCH PROPELLER SYSTEM IS DESCRIBED AS BEING COMPRISED OF: (A) PROPELLER HUB ASSEMBLY. THE PROCUREMENT WAS INITIATED BY A STEP ONE REQUEST FOR UNPRICED TECHNICAL PROPOSALS PACKAGE. PROPOSALS WERE SOLICITED UNDER LOT I FOR CONTROLLABLE PITCH PROPELLER SYSTEMS OF A DESIGN THAT HAD BEEN PROVEN SUCCESSFUL ABOARD A COMMERCIAL OR NAVAL VESSEL. PROSPECTIVE BIDDERS WERE INFORMED THAT AWARD WOULD BE MADE TO ONE BIDDER FOR ONE OF THE TWO LOTS.

B-159469, B-160265, MAR. 22, 1967

TO BALDWIN-LIMA-HAMILTON CORPORATION:

REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 17, 1966, AND TO SUBSEQUENT COMMUNICATIONS FROM YOU AND YOUR ATTORNEYS PROTESTING THE ACTION OF THE PHILADELPHIA NAVAL SHIPYARD, PHILADELPHIA, PENNSYLVANIA, IN AWARDING A CONTRACT FOR THREE SETS (TWO PROPELLERS EACH) OF CONTROLLABLE PITCH PROPELLER SYSTEMS TO BIRD-JOHNSON COMPANY, WALPOLE, MASSACHUSETTS, UNDER INVITATION FOR BIDS NO. IFB-151-642-6 WHICH WAS STEP TWO IN THE TWO-STEP FORMAL ADVERTISING METHOD USED FOR THE PROCUREMENT.

THE PROPELLER SYSTEMS ARE TO BE INSTALLED IN THREE TANK LANDING SHIP VESSELS (LST NOS. 1179-1181), THE FIRST SHIPS OF A NEW CLASS (1180) OF HIGH SPEED LSTS UNDER CONSTRUCTION AT THE PHILADELPHIA NAVAL SHIPYARD. SINGLE, COMPLETE CONTROLLABLE PITCH PROPELLER SYSTEM IS DESCRIBED AS BEING COMPRISED OF:

(A) PROPELLER HUB ASSEMBLY.

(B) FOUR REMOVABLE BLADES.

(C) PROPELLER CAP.

(D) SENDING UNITS FOR PITCH INDICATORS AND ANY ASSOCIATED ALARMS SYSTEMS.

(E) PROPELLER PITCH CONTROL SYSTEMS.

(1) NORMAL OR PNEUMATICALLY ACTUATED.

(2) EMERGENCY OR MANUALLY ACTUATED.

(F) SHAFTING BETWEEN REDUCTION GEAR AND PROPELLER.

THE PROCUREMENT WAS INITIATED BY A STEP ONE REQUEST FOR UNPRICED TECHNICAL PROPOSALS PACKAGE, P.R. 517-13361-6, ISSUED UNDER DATE OF JANUARY 20, 1966, AND AMENDED BY LETTERS OF FEBRUARY 11, FEBRUARY 21, AND APRIL 18, 1966. PROPOSALS WERE SOLICITED UNDER LOT I FOR CONTROLLABLE PITCH PROPELLER SYSTEMS OF A DESIGN THAT HAD BEEN PROVEN SUCCESSFUL ABOARD A COMMERCIAL OR NAVAL VESSEL, AND UNDER LOT II FOR CONTROLLABLE PITCH PROPELLER SYSTEM S OF THE DOUBLE CRANK TYPE, AND GENERALLY IN ACCORDANCE WITH A SPECIFIED NAVY DESIGN. PROSPECTIVE BIDDERS WERE INFORMED THAT AWARD WOULD BE MADE TO ONE BIDDER FOR ONE OF THE TWO LOTS. IN THIS FIRST STEP, OFFERORS WERE AUTHORIZED AND ENCOURAGED TO SUBMIT FOR EVALUATION MULTIPLE TECHNICAL PROPOSALS PRESENTING DIFFERENT BASIC APPROACHES TO THE FULFILLMENT OF THE STATED REQUIREMENTS AND OBJECTIVES.

AT THE CLOSE OF BUSINESS ON APRIL 25, 1966, THE PHILADELPHIA NAVAL SHIPYARD HAD RECEIVED THE FOLLOWING UNPRICED TECHNICAL PROPOSALS:

CHART

LOT I LOT II

BIRD-JOHNSON COMPANY X X

BALDWIN-LIMA-HAMILTON CORP. X

PROPULSION SYSTEMS, INC. X

HAMILTON STANDARD DIVISION OF X

UNITED AIRCRAFT CORP.

UNDER ITS LOT I PROPOSAL, BIRD-JOHNSON OFFERED A PROPELLER OF A SINGLE CRANK DESIGN. ALL OTHER ACCEPTABLE PROPOSALS OFFERED PROPELLERS OF THE DOUBLE CRANK TYPE. UPON CONCLUSION OF THE TECHNICAL EVALUATION AND CLARIFICATION OF PROPOSALS, IT WAS DETERMINED THAT ALL OF THE TECHNICAL PROPOSALS RECEIVED WERE ACCEPTABLE, AND INVITATION FOR BIDS NO. IFB-151- 642-6 (CALLING FOR PRICES ON EACH APPROVED SYSTEM FOR COMPLETE PROPELLER SETS FOR THREE VESSELS) WAS ISSUED TO THOSE FOUR FIRMS ON MAY 25, 1966.

THE FOLLOWING BIDS WERE RECEIVED AND OPENED ON JUNE 15, 1966:

CHART

LOT I (GROUP) LOT II (GROUP)

BIRD-JOHNSON COMPANY $ 948,961 $1,515,224

BALDWIN-LIMA-HAMILTON CORP. 1,097,025

PROPULSION SYSTEMS, INC. 1,478,041

THE LOW BID OF BIRD-JOHNSON ON ITS DESIGN PROPOSAL SUBMITTED UNDER LOT I WAS ACCEPTED AND A CONTRACT AWARDED TO THAT FIRM ON JUNE 17, 1966.

IN A SEPARATE PROCUREMENT ACTION OF MARCH 18, 1966, WHICH YOU BELIEVE HAS A MATERIAL EFFECT ON THE VALIDITY OF THE ABOVE CONTRACT, THE BUREAU OF SHIPS (NOW NAVAL SHIP SYSTEMS COMMAND), WASHINGTON, D.C., ISSUED INVITATION FOR BIDS NO. IFB-600-765-66'S TO MAJOR SHIPBUILDING FIRMS FOR CONSTRUCTION OF 17 ADDITIONAL TANK LANDING SHIPS OF THE 1180 CLASS. THE IFB, AS AMENDED, INCORPORATED BUREAU OF SHIPS SPECIFICATIONS DATED OCTOBER 19, 1965, ON THE BUILDING OF THE LST 1180 CLASS OF SHIPS. WHILE SECTION 9440-1, PROPELLERS, OF THE ORIGINAL LST 1180 SPECIFICATIONS APPARENTLY REQUIRED THE NAVY DESIGN, AND INCLUDED A GENERAL REQUIREMENT THAT PROPELLERS BE THE DOUBLE CRANK TYPE HAVING TWO CRANK PINS FOR EACH BLADE ASSEMBLY, PROSPECTIVE BIDDERS WERE ADVISED IN THE PRE-BIDDING CONFERENCE HELD APRIL 7, 1966, THAT THE SPECIFICATIONS WOULD BE CHANGED TO PERMIT INSTALLATION OF PROPELLERS OF A PROVEN COMMERCIAL DESIGN, AND SUCH SECTION WAS THEREAFTER MODIFIED ON APRIL 22, 1966, TO INCLUDE THE FOLLOWING PROVISION:

"AS AN ALTERNATE TO THE DESIGN FURNISHED BY THE BUREAU, A PROVEN COMMERCIAL DESIGN CONTROLLABLE PITCH PROPELLER MODIFIED FOR THE LST AND APPROVED BY THE BUREAU MAY BE PROVIDED.'

BIDS WERE OPENED ON MAY 16, 1966, AND THE CONTRACT WAS AWARDED ON JULY 15, 1966, TO THE NATIONAL STEEL AND SHIPBUILDING COMPANY, SAN DIEGO, CALIFORNIA. THE RECORD DOES NOT INDICATE THAT BALDWIN-LIMA- HAMILTON SUBMITTED A BID OR WAS OTHERWISE INVOLVED IN THE PROCUREMENT EXCEPT AS A PROSPECTIVE SUBCONTRACTOR TO THE PRIME CONTRACTOR, NOR DOES THERE APPEAR TO BE AVAILABLE ANY INFORMATION AS TO THE TYPE OF PROPELLERS INTENDED TO BE FURNISHED BY NATIONAL STEEL OR THE SOURCE THEREOF.

BY TELEGRAM DATED OCTOBER 25, 1966, THE NAVAL SHIP SYSTEMS COMMAND INSTRUCTED THE SUPERVISOR OF SHIPBUILDING, LONG BEACH, CALIFORNIA, TO ADVISE NATIONAL STEEL THAT IN ACCORDANCE WITH SECTION 9440-1 OF THE LST 1180 SPECIFICATIONS THE COMMAND HAD APPROVED THE BIRD-JOHNSON PROVEN DESIGN PROPELLER SUBMITTED FOR LSTS 1179-1181, AND THAT PURSUANT TO SECTION 9020-0 OF THE SPECIFICATIONS NATIONAL STEEL WAS REQUIRED TO FURNISH IDENTICAL SHAFTING AND PROPELLERS. SECTION 9020-0 INCLUDES A PROVISION STATING THAT SHAFTING AND PROPELLERS SHALL BE IDENTICAL FOR ALL SHIPS OF THE SAME DESIGN CLASS. THE SUPERVISOR OF SHIPBUILDING FORWARDED THE CONTENTS OF THE OCTOBER 25 TELEGRAM TO NATIONAL STEEL BY LETTER DATED NOVEMBER 3, 1966. PRIOR TO THE ISSUANCE OF SUCH LETTER, AND AFTER A SERIES OF NEGOTIATIONS WITH BIRD-JOHNSON, NATIONAL STEEL CONTRACTED WITH BIRD-JOHNSON ON OCTOBER 27, 1966, FOR 17 SHIPSETS OF CONTROLLABLE PITCH PROPELLERS OF THE SAME PROVEN DESIGN AS THE PROPELLERS REQUIRED BY BIRD- JOHNSON'S CONTRACT UNDER IFB-151 642-6. THE RECORD DOES NOT ESTABLISH THAT NATIONAL STEEL HAD RECEIVED PREVIOUS INFORMATION CONCERNING THE TELEGRAM OR THAT ITS DECISION TO CONTRACT WITH BIRD-JOHNSON WAS INFLUENCED BY THAT WIRE. IT MUST BE PRESUMED, HOWEVER, THAT IT WAS AWARE OF THE CONTRACT AWARDED TO THAT FIRM BY THE PHILADELPHIA NAVAL SHIPYARD TO FURNISH THE PROPELLERS FOR THE THREE VESSELS BEING BUILT BY THAT YARD, WHICH WERE THE LEAD VESSELS OF THE CLASS TO WHICH OTHERS WOULD BE REQUIRED TO CONFORM.

IN THE COURSE OF YOUR PROTEST YOU DWELL AT LENGTH ON THE SOLICITATION UNDER IFB-600-66'S AND ALLEGED IMPROPRIETIES OF THE NAVY IN THE ADMINISTRATION OF THE CONTRACT AWARDED THEREUNDER TO NATIONAL STEEL FOR THE CONSTRUCTION OF THE 17 ADDITIONAL SHIPS. WHILE IT MAY BE THAT THE RECEIPT AND OPENING OF BIDS FOR THE CONSTRUCTION OF THE 17 VESSELS PRIOR TO FINAL DETERMINATION OF THE TYPE AND SOURCE OF PROPELLERS TO BE USED ON THE FIRST THREE OF THE CLASS CREATED DIFFICULTIES FOR PROSPECTIVE BIDDERS ON THE SHIP CONSTRUCTION WE ARE AWARE OF NO COMPLAINT BY ANY OF THOSE BIDDERS AND WE ARE UNABLE TO PERCEIVE ANY PREJUDICE TO ANY OF THE PROSPECTIVE SUPPLIERS OF PROPELLERS, ALL OF WHOM APPEAR TO HAVE HAD EQUAL OPPORTUNITY TO ASCERTAIN THE DETAILS OF THE SHIP CONSTRUCTION INVITATION. WE ARE NOT AWARE OF ANY LEGAL PRINCIPLE ON WHICH NAVY'S SUBSEQUENT ACTIONS IN THE ADMINISTRATION OF ITS CONTRACT WITH NATIONAL STEEL MAY BE REGARDED AS AFFECTING THE VALIDITY OF THE SEPARATE AND PREVIOUSLY AWARDED NAVY CONTRACT WITH BIRD-JOHNSON.

BASICALLY, YOUR PROTEST AGAINST THE AWARD TO BIRD-JOHNSON UNDER IFB 151- 642-6 IS PREMISED ON THE CONTENTION THAT THE BIRD-JOHNSON BID ON A ONE CRANK PROPELLER WAS NONRESPONSIVE TO THE REQUIREMENTS OF THE INVITATION BECAUSE THE PRODUCT OFFERED DID NOT COMPLY WITH THE ALLEGED TWO CRANK REQUIREMENTS OF THE LST 1180 SHIP SPECIFICATIONS, WHICH SPECIFICATIONS YOU DESCRIBE AS ,CONTROLLING" EVEN THOUGH THE LST 1180 SPECIFICATIONS WERE NOT MENTIONED OR MADE A PART OF THE PROPELLER SYSTEMS SOLICITATION. TO UPHOLD SUCH A POSITION REQUIRES THE CONCLUSION THAT THE RESPONSIVENESS OR NONRESPONSIVENESS OF A BID MAY BE DETERMINED BY ITS CONFORMITY OR NONCONFORMITY TO SPECIFICATIONS OR REQUIREMENTS WHICH ARE NOT SET FORTH OR INCORPORATED IN THE INVITATION. SUCH A VIEW IS COMPLETELY INCOMPATIBLE WITH THE BASIC LAW, 10 U.S.C. 2305, AND THE IMPLEMENTING ARMED SERVICES PROCUREMENT REGULATION, WHICH REQUIRE THAT THE AGENCY'S NEEDS BE ADEQUATELY DESCRIBED IN THE INVITATION AND THAT AWARD BE MADE TO THAT RESPONSIBLE BIDDER WHOSE BID "CONFORMS TO THE INVITATION.' WHILE YOU HAVE REFERRED REPEATEDLY TO THE LST 1180 SPECIFICATION AS BEING ,CONTROLLING" YOU HAVE CITED NO PROVISION OF LAW OR REGULATION TO SUPPORT YOUR POSITION THAT THE RESPONSIVENESS OF BIRD-JOHNSON'S BID IS CONTROLLED BY REQUIREMENTS OF SPECIFICATIONS NOT INCORPORATED IN THE INVITATION RATHER THAN THOSE REQUIREMENTS SPECIFICALLY STATED THEREIN. LIKEWISE, WHILE YOUR VARIOUS COMMUNICATIONS CONTAIN GENERAL ALLEGATIONS TO THE EFFECT THAT IN MAKING THE AWARD NAVY HAS VIOLATED THE APPLICABLE PROCUREMENT STATUTES AND REGULATIONS, WE DO NOT FIND IN ANY OF YOUR COMMUNICATIONS A DEFINITE AND SPECIFIC ALLEGATION OF ANY PARTICULAR ACTION WHICH VIOLATED A SPECIFIED PROVISION OF LAW OR REGULATION.

IN CONSIDERING A PROTEST OF A GOVERNMENT PROCUREMENT ACTION FROM AN INTERESTED PARTY, OUR FUNCTION IS ONLY TO INSURE THAT PROCUREMENTS ARE MADE IN ACCORDANCE WITH THE APPLICABLE STATUTES AND REGULATIONS, AND CANCELLATION OF BIRD-JOHNSON'S CONTRACT CAN BE DIRECTED BY THIS OFFICE ONLY UPON THE LEGAL PREMISE THAT THE ACCEPTANCE OF THAT FIRM'S BID DID NOT RESULT IN A VALID CONTRACT, AND THAT WE WOULD THEREFORE BE REQUIRED TO DISALLOW CREDIT FOR ANY PAYMENT OF APPROPRIATED FUNDS PURSUANT THERETO. IT IS ALSO WELL ESTABLISHED THAT THE DRAFTING OF SPECIFICATIONS FOR A PROCUREMENT, AND DETERMINATIONS AS TO WHETHER THE PRODUCTS PROPOSED TO BE FURNISHED MEET THE SPECIFICATION REQUIREMENTS ARE PRIMARILY THE FUNCTIONS OF THE PROCURING AGENCY. OUR OFFICE, HAVING NEITHER A SCIENTIFIC NOR ENGINEERING STAFF, WILL NOT INTERFERE EXCEPT WHERE IT IS CLEARLY SHOWN THAT CONTRACTING OFFICIALS OF THE GOVERNMENT HAVE ABUSED THEIR AUTHORITY BY ACTING IN BAD FAITH, OR WITHOUT A REASONABLE FACTUAL BASIS, OR IN DISREGARD OF THE PERTINENT LAW OR REGULATIONS.

IN THE INSTANT PROCUREMENT THE NAVY DETERMINED THAT ITS REQUIREMENT FOR A NEW TYPE OF LST WOULD BE FULFILLED BY CONSTRUCTING THE FIRST THREE SHIPS OF SUCH CLASS (1180) AT THE PHILADELPHIA NAVAL SHIPYARD AND FORMALLY ADVERTISING FOR THE FOLLOW-ON 17 SHIPS FOR AWARD TO PRIVATE SHIPBUILDERS. ALTHOUGH THE BUREAU OF SHIPS HAD PREPARED CONFIDENTIAL SPECIFICATIONS, DATED OCTOBER 19, 1965, AND MODIFICATIONS THERETO, FOR BUILDING TANK LANDING SHIPS OF THE LST 1180 CLASS, AND SUCH SPECIFICATIONS CONTAINED CERTAIN REQUIREMENTS FOR PROPELLERS INCLUDING THE DOUBLE CRANK FEATURE, THE NAVY HAS SPECIFICALLY REPORTED THAT IN PREPARING THE SPECIFICATIONS FOR THE SOLICITATION, P.R. 517 13361-6, IT WAS THE AGENCY'S INTENTION, NOT ONLY TO ACHIEVE MAXIMUM COMPETITION IN THE SUBJECT PROCUREMENT, BUT ALSO TO AFFORD ALL POTENTIAL SOURCES THE OPPORTUNITY TO PROPOSE, AND TO GIVE NAVY THE OPPORTUNITY TO EVALUATE, A SINGLE CRANK PROVEN DESIGN UNDER LOT I. IN FURTHERANCE OF SUCH OBJECTIVES THE NAVY ADVISES THAT IT PURPOSELY OMITTED ANY REFERENCE TO CRANK REQUIREMENTS FOR LOT I PROPOSALS, AND WE DO NOT FIND ANY AMBIGUITY IN RELATION TO OTHER PROVISIONS OF THE INVITATION CONCERNING THE ACCEPTABILITY OF SINGLE CRANK DESIGNS UNDER THE LOT I GROUPING. ADDITIONALLY, WE FIND NO PROVISIONS OF LAW OR REGULATION (AND NONE HAVE BEEN POINTED OUT BY YOU) MAKING IT MANDATORY THAT THE SOLICITATION BE RESTRICTED TO THE DOUBLE CRANK DESIGN SET FORTH IN THE BUREAU OF SHIPS SPECIFICATION, OR PRECLUDING THE NAVY FROM SOLICITING PROPOSALS IN ACCORDANCE WITH ITS SPECIFIC WISHES FOR A VARIETY OF PROVEN DESIGNS FOR EVALUATION AGAINST ITS PROPELLER REQUIREMENTS AND OBJECTIVES. IT FURTHER APPEARS THAT NAVY RECOGNIZED THE POSSIBILITY OF DEFICIENCIES IN THE NAVY DOUBLE CRANK DESIGN SPECIFIED UNDER LOT II OF THE SUBJECT INVITATION INASMUCH AS PROPOSALS THEREUNDER WERE REQUIRED TO INCLUDE A TECHNICAL EVALUATION OF THAT DESIGN ,INCLUDING RECOMMENDED CHANGES" TO ASSURE PERFORMANCE IN ACCORDANCE WITH THE STATED NEEDS. THE SOLICITATION AFFORDED ALL OF THE PROSPECTIVE BIDDERS THE SAME OPPORTUNITY TO PROPOSE SINGLE CRANK DESIGNS (WHICH YOU ALLEGE CAN BE PRODUCED AT A LESSER COST) AND/OR DOUBLE CRANK DESIGNS. THAT YOU CLEARLY UNDERSTOOD THE DISTINCTION BETWEEN THE LOT I AND THE LOT II REQUIREMENTS IS SHOWN BY YOUR LETTER TO THE BUREAU OF SHIPS OF APRIL 22, 1966, WHEREIN YOU STATE THAT "LOT 2 SPECIFICATIONS REQUIRE A DOUBLE CRANK HUB MECHANISM AND A SPECIFIC HUB DIAMETER. LOT I HAS NO SUCH TRICTIONS.' ALL OF THE TECHNICAL PROPOSALS RECEIVED WERE EVALUATED AND FOUND ACCEPTABLE, INCLUDING THE BIRD-JOHNSON LOT I PROPOSAL ON A SINGLE CRANK PROPELLER, AND PURSUANT TO THAT FIRM'S SUBSEQUENT SUBMISSION OF THE LOW RESPONSIVE BID THEREON IT WAS AWARDED THE CONTRACT. WHILE NAVY CONCEDES THAT THE BIRD JOHNSON SINGLE CRANK PROPELLER MAY NOT HAVE BEEN THE BEST CHOICE FROM A TECHNICAL STANDPOINT, IT REPORTS THAT THERE IS NO MATERIAL DIFFERENCE IN THE DAY TO DAY PERFORMANCE OR RELIABILITY OF EITHER TYPE OF PROPELLER, AND THAT BOTH THE SINGLE CRANK AND DOUBLE CRANK PROPELLERS WILL MEET THE PERFORMANCE AND MANEUVERING REQUIREMENTS OF ITS SHIPS IN COMBAT AREAS. IN EACH CASE, IT IS STATED, THE PERFORMANCE AND RELIABILITY OF THE PROPELLER IS DEPENDENT UPON THE QUALITY OF THE DESIGN, WHICH INCLUDES MANY MORE FACTORS THAN THE NUMBER OF CRANKS, AND A PROPERLY PRODUCED QUALITY PRODUCT BY A COMPETENT MANUFACTURER. CLEARLY, SUCH CONSIDERATIONS AND ACTIONS IN THE SUBJECT PROCUREMENT DO NOT SUGGEST AN ADMINISTRATIVE DISREGARD OF THE PERTINENT STATUTES AND REGULATIONS AS YOU CONTEND, OR OF THE AGENCY'S ACTUAL NEEDS, BUT SEEM TO INDICATE, INSTEAD, AN OBSERVANCE OF THE BASIC PRINCIPLES OF FORMAL ADVERTISING AS OUTLINED IN SECTION II OF THE ARMED SERVICES PROCUREMENT REGULATION.

YOU CONTEND THAT SINCE THERE COULD BE NO PRICE COMPETITION BETWEEN SINGLE CRANK PROPELLERS AND DOUBLE CRANK PROPELLERS, AND SINCE ONLY ONE ACCEPTABLE PROPOSAL ON A SINGLE CRANK DESIGN WAS RECEIVED, NAVY WAS OBLIGATED "UNDER THE APPLICABLE PROCUREMENT REGULATIONS" TO NEGOTIATE A CONTRACT WITH BIRD-JOHNSON INSTEAD OF PROCEEDING WITH THE SECOND STEP OF THE PROCUREMENT. THE APPLICABLE REGULATION, ASPR 2 503.1 (H), PROVIDES:

"IF, AS A RESULT OF THE EVALUATION OF TECHNICAL PROPOSALS, IT APPEARS NECESSARY TO DISCONTINUE TWO-STEP FORMAL ADVERTISING, A STATEMENT SETTING FORTH THE FULL FACTS AND CIRCUMSTANCES SHALL BE MADE A PART OF THE CONTRACT FILE. WHEN STEP ONE RESULTS IN NO ACCEPTABLE TECHNICAL PROPOSAL OR ONLY ONE ACCEPTABLE TECHNICAL PROPOSAL, THE PROCUREMENT MAY BE CONTINUED BY NEGOTIATION UNDER THE AUTHORITY OF 3 210.2 (III).'

SINCE FIVE ACCEPTABLE PROPOSALS HAD BEEN SUBMITTED BY FOUR DIFFERENT FIRMS UNDER THE FIRST STEP, WE DO NOT AGREE WITH YOUR VIEW THAT NAVY WAS "OBLIGATED" BY THAT REGULATION TO CONTINUE THE PROCUREMENT BY NEGOTIATION WITH BIRD-JOHNSON. FURTHER, THE RECORD DOES NOT SUPPORT YOUR PREMISE, THAT THERE CAN BE NO PRICE COMPETITION BETWEEN DOUBLE CRANK PROPELLERS AND SINGLE CRANK ROPELLERS; THE BIDS RECEIVED ON THE SUBJECT PROCUREMENT SHOWED MUCH CLOSER COMPETITION BETWEEN YOUR PRICE AND THAT OF BIRD-JOHNSON THAN BETWEEN YOURS AND THOSE OF EITHER OTHER BIDDER ON TWO-CRANK PROPELLERS.

FINALLY, YOU CONTEND THAT SINCE NAVY KNEW THAT ONLY BIRD-JOHNSON HAD OFFERED A SINGLE CRANK PROPELLER "BIRD-JOHNSON WAS PLACED BY THE NAVY IN A POSITION OF BEING ABLE TO QUOTE A PRICE FOR ITS LESS SATISFACTORY DESIGN JUST BELOW THE MINIMUM PRICE WHICH IT MIGHT ESTIMATE COULD BE QUOTED FOR THE SUPERIOR LST-1180 SPECIFICATION DESIGN. THIS PRICE MIGHT WELL HAVE LITTLE TO DO WITH THE ACTUAL COST OF PRODUCING THE LESS SATISFACTORY DESIGN.' IT IS CLEAR THAT EVEN IF BIRD-JOHNSON COULD HAVE SUCCESSFULLY ACCOMPLISHED THE DESCRIBED CALCULATIONS, WHICH IGNORES THE POSSIBILITY OF COMPETITION FROM A TWO CRANK PROVEN DESIGN UNDER LOT I, SUCH A COURSE OF ACTION WOULD HAVE BEEN DEPENDENT IN THE FIRST PLACE UPON THAT FIRM HAVING BEEN ADVISED THAT NONE OF THE ACCEPTABLE PROPOSALS SUBMITTED BY ITS COMPETITORS HAD PRESENTED A ONE CRANK DESIGN. THE RECORD AFFORDS NO BASIS ON WHICH TO CONCLUDE THAT NAVY SO ADVISED BIRD-JOHNSON, NOR HAVE YOU MADE THAT ALLEGATION.

SINCE THE FACTS AND CIRCUMSTANCES SHOWN BY THE RECORD BEFORE US DO NOT ESTABLISH THAT THE ACTION OF THE CONTRACTING AGENCY WAS IN VIOLATION OF APPLICABLE LAW OR REGULATION SO AS TO RENDER THE CONTRACT VOID AB INITIO, WE FIND NO BASIS FOR ANY ACTION BY OUR OFFICE WITH RESPECT THERETO, AND YOUR PROTEST MUST BE DENIED.

WE ARE, HOWEVER, ADVISING THE SECRETARY OF THE NAVY OF OUR OPINION THAT ACTIONS OF THE PHILADELPHIA NAVAL SHIPYARD AND THE NAVAL SHIP SYSTEMS COMMAND SHOULD HAVE BEEN MORE CLOSELY COORDINATED AND THAT BIDDERS ON THE PHILADELPHIA NAVAL SHIPYARD INVITATION SHOULD HAVE BEEN CLEARLY ADVISED THAT THE PROPELLER SYSTEMS TO BE INSTALLED IN THE 17 VESSELS TO BE CONSTRUCTED FOR THE COMMAND WOULD BE OF THE SAME DESIGN AS THOSE INSTALLED IN THE THREE LEAD VESSELS TO BE BUILT BY THE NAVAL SHIPYARD. WE ARE ALSO SUGGESTING THAT APPROPRIATE STEPS BE TAKEN TO PROVIDE FOR SUCH CLARIFICATION IN ANY SIMILAR FUTURE PROCUREMENT.

Feb 26, 2021

Feb 25, 2021

Feb 24, 2021

Looking for more? Browse all our products here