B-167389 (2), FEB. 12, 1970

B-167389 (2), FEB. 12, 1970

BID PROTEST--NEGOTIATED AWARD PROCEDURES--PROPRIETY LETTER TO SECRETARY OF AIR FORCE CONCERNING MATTERS DISCLOSED IN CONSIDERATION OF PROTEST OF MODULUX, INC. AGAINST AWARD TO ELDER OILFIELD, INC. ISSUED BY THE AIR FORCE SECURITY SERVICE. THE ABSENCE OF ANY COMMON CLOSING DATE ESTABLISHED TO TERMINATE DISCUSSIONS WITH THE OFFERORS IS A DEFICIENCY IN NEGOTIATION PROCEDURE AND SHOULD BE CORRECTED IN FUTURE CASES. THE APPLICABILITY OF UNIFORM MATERIAL MOVEMENT AND ISSUE PRIORITY SYSTEM (UMMIPS) OF PRIORITY DESIGNATORS, WHICH IS DESIGNED FOR NORMALLY STOCKED SUPPLIES TO A CONSTRUCTION PROCUREMENT, IS QUESTIONED.

TO MR. SECRETARY:

WE REFER TO A LETTER (WITH ATTACHMENT) DATED AUGUST 7, 1969, FROM THE DEPUTY CHIEF, PROCUREMENT OPERATIONS DIVISION, DIRECTORATE OF PROCUREMENT POLICY, DEPUTY CHIEF OF STAFF (SYSTEMS AND LOGISTICS), LETTER (WITH ATTACHMENT) DATED SEPTEMBER 23, 1969, FROM THE CHIEF OF THE PROCUREMENT OPERATIONS DIVISION, DIRECTORATE OF PROCUREMENT POLICY, AND TO A LETTER (WITH ATTACHMENT) DATED OCTOBER 15, 1969, FROM THE CHIEF OF THE CONTRACTOR RELATIONS BRANCH, PROCUREMENT OPERATIONS DIVISION, ALL REPORTING ON THE PROTEST OF MODULUX, INC; AGAINST THE AWARD OF A CONTRACT TO ELDER- OILFIELD, INC; UNDER REQUEST FOR PROPOSALS NO. F41621-69-R-0348, ISSUED BY THE AIR FORCE SECURITY SERVICE, SAN ANTONIO, TEXAS.

ENCLOSED IS A COPY OF OUR SELF-EXPLANATORY DECISION OF TODAY TO THE ATTORNEYS FOR MODULUX. IN ADDITION TO THE ISSUES CONSIDERED THEREIN, THERE APPEARS TO HAVE BEEN NO COMMON CLOSING DATE ESTABLISHED TO TERMINATE THE DISCUSSIONS CONDUCTED WITH THE TWO OFFERORS, I.E; MODULUX WAS GRANTED AN OPPORTUNITY TO REVISE ITS PROPOSAL AT A TIME WHEN ELDER-OILFIELD HAD ALREADY SUBMITTED A FINAL REVISION. IN THIS CONNECTION, SEE PARAGRAPH 3- 805.1 (B) OF THE ARMED SERVICES PROCUREMENT REGULATION AND OUR DECISIONS 48 COMP. GEN. 536 (1969) AND ID. 582 (1969). WE ARE BRINGING THIS MATTER TO YOUR ATTENTION BECAUSE IT REPRESENTS A DEFICIENCY IN THE NEGOTIATION PROCEDURES LEADING TO THE AWARD OF THE CONTRACT TO ELDER-OILFIELD.

YOU WILL ALSO OBSERVE THAT IN THE FINAL PARAGRAPHS OF THE DECISION, WHEREIN WE CONSIDERED MODULUX'S ALLEGATION THAT THERE WAS NO "PUBLIC EXIGENCY" WHICH WOULD AUTHORIZE NEGOTIATION, WE EXPRESSED DOUBT AS TO THE APPLICABILITY OF THE UMMIPS SYSTEM OF PRIORITY DESIGNATORS TO THIS PARTICULAR PROCUREMENT. FOR EXAMPLE, THE COVER LETTER TO THE DOD INSTRUCTION STATES THE SYSTEM'S PURPOSE AND OBJECTIVE, IN PART, AS FOLLOWS:

"THIS INSTRUCTION ESTABLISHES THE UNIFORM MATERIEL MOVEMENT AND ISSUE PRIORITY SYSTEM (UMMIPS) FOR USE IN THE REQUISITIONING AND ISSUE OF MATERIEL FROM THE DOD AND GSA DISTRIBUTION SYSTEMS AND IN THE MOVEMENT OF MATERIEL IN THE DEFENSE TRANSPORTATION SYSTEM. * * *"

THROUGHOUT THE INSTRUCTION, THERE ARE REPEATED INDICATIONS THAT UMMIPS RELATES TO "MATERIEL" AND "ITEMS NORMALLY STOCKED," AND EMPHASIS IS ON IDENTIFYING "THE RELATIVE IMPORTANCE OF COMPETING DEMANDS FOR LOGISTICS SYSTEM RESOURCES--TRANSPORTATION, WAREHOUSING, PAPERWORK PROCESSING, INVENTORIES, ETC." WE FAIL TO UNDERSTAND THE APPLICABILITY OF A SYSTEM DESIGNED FOR REQUISITION AND ISSUE OF NORMALLY STOCKED SUPPLIES WITHIN THE DOD SUPPLY AND TRANSPORTATION SYSTEM TO A CONSTRUCTION PROCUREMENT WHERE THE CONTRACTOR IS TO BE RESPONSIBLE FOR DESIGN, FABRICATION, TRANSPORTATION TO SITE, ERECTION, AND ASSEMBLY.

IN ADDITION, SCRUTINY OF PURCHASE REQUESTS WR-9-07254, IDC-P-69-01, AND IDC-P-69-02 DISCLOSES CONFUSION AS TO WHETHER DESIGNATOR 01, 02, OR 03 WAS APPROPRIATE FOR THIS PROCUREMENT. THEREFORE, ASSUMING THE APPLICABILITY OF THE UMMIPS SYSTEM IN THESE CIRCUMSTANCES, IT SEEMS THAT THE COGNIZANT AIR FORCE OFFICIALS WERE UNCERTAIN AS TO WHICH PRIORITY DESIGNATOR WAS APPLICABLE. WE HAVE NOTHING PRESENTLY OF RECORD TO EXPLAIN THE MANNER IN WHICH THE CRITERIA ESTABLISHED BY THE INSTRUCTION WERE APPLIED IN THIS CASE.

WE WOULD APPRECIATE RECEIPT OF YOUR VIEWS ON THESE LAST TWO MATTERS AT YOUR EARLIEST CONVENIENCE.