B-163828, JUN. 18, 1968

B-163828: Jun 18, 1968

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ON THE BASIS THAT BIDS WERE IMPROPERLY EVALUATED. THE INVITATION WAS ISSUED ON FEBRUARY 10. WHICH ARE MANUFACTURED BY OTHER GOVERNMENT CONTRACTORS. ARE TO BE PROVIDED AS GOVERNMENT FURNISHED PROPERTY AND MAY BE SHIPPED DIRECTLY FROM THE MANUFACTURER OR FROM STORAGE IN ARMY DEPOTS DEPENDING UPON DELIVERY SCHEDULES. FOURTEEN BIDS WERE RECEIVED. OF WHICH THE LOWEST FOR THE TOTAL TWO YEAR QUANTITIES WERE YOURS AND FERMONT-S. 421.36 *THIS PRICE QUOTED BY FERMONT FOR THE 400-HZ GENERATORS WAS CONDITIONED UPON AWARD TO FERMONT OF BOTH TYPES OF GENERATORS. ITS PRICE FOR THESE 144 UNITS WAS $2. PROVISION WAS ALSO MADE FOR PRICE REDUCTIONS IN THE EVENT OF WAIVER OF PRE PRODUCTION MODELS. IN ADDITION IT WAS STIPULATED THAT THE EVALUATION WOULD INCLUDE THE COST OF REQUIRED ENGINE REPAIRS ON THE BASIS OF 3 MAN-HOURS FOR EACH OF 12.

B-163828, JUN. 18, 1968

TO ONAN DIVISION OF STUDEBAKER CORPORATION:

WE REFER TO YOUR TELEGRAM OF MARCH 18, 1968, AND TO SUBSEQUENT COMMUNICATIONS FROM YOUR ATTORNEYS PROTESTING, ON THE BASIS THAT BIDS WERE IMPROPERLY EVALUATED, THE PROPOSED AWARD OF A CONTRACT FOR GENERATOR SETS TO FERMONT DIVISION, DYNAMICS CORPORATION OF AMERICA, BY THE UNITED STATES ARMY MOBILITY EQUIPMENT COMMAND UNDER INVITATION FOR BIDS NO. DAAK01-68-B- 3303.

THE INVITATION WAS ISSUED ON FEBRUARY 10, 1968, AS A TWO YEAR MULTI YEAR PROCUREMENT FOR 12,435 5 KW 60-HERTZ AND 144 5 KW 400-HERTZ, GASOLINE- ENGINE DRIVEN GENERATOR SETS TOGETHER WITH ASSOCIATED ITEMS. THE GASOLINE ENGINES, WHICH ARE MANUFACTURED BY OTHER GOVERNMENT CONTRACTORS, ARE TO BE PROVIDED AS GOVERNMENT FURNISHED PROPERTY AND MAY BE SHIPPED DIRECTLY FROM THE MANUFACTURER OR FROM STORAGE IN ARMY DEPOTS DEPENDING UPON DELIVERY SCHEDULES.

FOURTEEN BIDS WERE RECEIVED, OF WHICH THE LOWEST FOR THE TOTAL TWO YEAR QUANTITIES WERE YOURS AND FERMONT-S, IN THE FOLLOWING RESPECTIVE AMOUNTS:

ONAN FERMONT

---- ------- 12435 60-HZ GENERATOR SETS

$10,031,536.95 $10,072,350.00

144 400-HZ GENERATOR SETS 209,065.68 * 144,288.00

TOTAL $10,240,602.63 $10,216,638.00 LESS: PROMPT PAYMENT DISCOUNT

OFFERED - - - 10,216.64

NET TOTAL $10,240,602.63 $10,206,421.36

*THIS PRICE QUOTED BY FERMONT FOR THE 400-HZ GENERATORS WAS CONDITIONED UPON AWARD TO FERMONT OF BOTH TYPES OF GENERATORS; OTHERWISE, ITS PRICE FOR THESE 144 UNITS WAS $2,500 EACH.

THE INVITATION SPECIFICALLY PROVIDED FOR EVALUATION OF THE GOVERNMENT'S COST OF TRANSPORTATION OF THE COMPLETED UNITS FROM THE PLACE OF MANUFACTURE TO THE DESTINATIONS STATED IN THE IFB. PROVISION WAS ALSO MADE FOR PRICE REDUCTIONS IN THE EVENT OF WAIVER OF PRE PRODUCTION MODELS; AND IN ADDITION IT WAS STIPULATED THAT THE EVALUATION WOULD INCLUDE THE COST OF REQUIRED ENGINE REPAIRS ON THE BASIS OF 3 MAN-HOURS FOR EACH OF 12,435 ENGINES AT A LABOR RATE TO BE QUOTED BY THE BIDDER. YOUR BID QUOTED A RATE OF $5 PER MAN-HOUR AND FERMONT OFFERED THE REPAIRS WITHOUT CHARGE.

ADJUSTMENT OF THE BID PRICES FOR THE TOTAL TWO-YEAR REQUIREMENTS IN ACCORDANCE WITH THE ABOVE PROVISIONS RESULTED IN FINAL EVALUATION OF YOUR BID AT $10,535,616.86, AND FERMONT'S AT $10,337,213.27.

DESPITE THE PRICE DIFFERENTIALS BETWEEN THE BIDS, YOU NEVERTHELESS CONTEND THAT YOUR BID, RATHER THAN FERMONT-S, SHOULD BE ACCEPTED. SUPPORT OF YOUR CONTENTION YOU ARGUE THAT (1) THE METHOD OF EVALUATION OF ENGINE REPAIRS PRESCRIBED IN THE IFB IS ERRONEOUS, UNREALISTIC AND ARBITRARY; (2) SINCE BIDDERS WERE REQUIRED TO QUOTE A LABOR RATE FOR PACKING NON-REPAIRABLE ENGINES FOR RETURN TO THE MANUFACTURER AN ESTIMATED AGGREGATE COST FOR SUCH PACKING SHOULD HAVE BEEN CONSIDERED IN THE EVALUATION; (3) SINCE BIDDERS WERE ALSO REQUIRED TO QUOTE A PRICE FOR ON- SITE TECHNICAL ASSISTANCE WHICH THE CONTRACTOR MIGHT BE REQUIRED TO RENDER, EVALUATION SHOULD HAVE INCLUDED A COST FIGURE FOR SUCH ASSISTANCE; AND (4) FERMONT'S QUOTATION OF AN ALLEGEDLY EXORBITANT RATE OF $20 PER MAN -HOUR FOR THE UNEVALUATED ITEM OF PACKAGING ENGINES, COUPLED WITH ITS OFFER OF REPAIR SERVICES AT NO CHARGE, ARE CLEAR EVIDENCE OF AN ATTEMPT TO "BUY IN," WHICH ALONE WOULD JUSTIFY REJECTION OF THE FERMONT BID. YOU PROPOSE ADJUSTMENTS TO THE BID EVALUATION WHICH WOULD ADD SOME $64,000 TO THE FERMONT BID FOR THE COST OF PACKAGING ENGINES FOR RETURN, AS AGAINST A $1,018 ADDITION TO YOURS; ADD $5,000 TO FERMONT'S FOR COST OF TECHNICAL ASSISTANCE, FOR WHICH YOU WOULD NOT CHARGE; AND REDUCE THE COST OF ENGINE REPAIR CHARGED TO YOU FROM APPROXIMATELY $186,000 TO $21,000. THE RESULT OF YOUR ADJUSTMENTS WOULD BE TO PRODUCE FINAL BIDS OF $10,371,075 FROM YOUR FIRM AND$10,406,366 FROM FERMONT.

PARAGRAPH 10 (A) OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS (STANDARD FORM 33A) STATES THAT THE CONTRACT WILL BE AWARDED TO THAT RESPONSIBLE OFFEROR WHOSE OFFER CONFORMING TO THE SOLICITATION WILL BE MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED. PARAGRAPH 29 OF SUCH ADDITIONAL INSTRUCTIONS PROVIDES: "BID EVALUATION. BIDS WILL BE EVALUATED ON THE BASIS OF LOWEST OVER ALL COST TO THE GOVERNMENT, CONSISTENT WITH REQUIREMENTS. WHEN BIDS ARE SUBMITTED ON AN F.O.B. ORIGIN BASIS THE MOST ECONOMICAL MODE OF COMMERCIAL TRANSPORTATION CONSISTENT WITH MILITARY REQUIREMENTS AND AS DETERMINED BY THE GOVERNMENT, BETWEEN THE BIDDER'S SHIPPING POINT AS SET FORTH BY THE BIDDER HEREIN AND THE DESIGNATED DESTINATION AS SET FORTH IN THIS INVITATION, WILL BE CONSIDERED IN DETERMINING THE LOWEST ESTIMATED COST TO THE GOVERNMENT. ,NOTE: IN THE EVENT AT THE TIME OF AWARD, THE GOVERNMENT ELECTS TO EXERCISE ITS RIGHTS UNDER THE INCREASE IN REQUIREMENTS' CLAUSE AS CONTAINED IN THE SPECIAL TERMS AND CONDITIONS HEREIN, BIDS WILL BE EVALUATED ON THE BASIS OF TOTAL QUANTITY TO BE AWARDED INCLUDING THE QUANTITY TO BE AWARDED UNDER THE INCREASE IN REQUIREMENTS' CLAUSE, BUT IF THE GOVERNMENT DOES NOT SO ELECT, EVALUATION WILL BE ON THE BASIS OF THE TOTAL QUANTITY TO BE AWARDED.'

WITH RESPECT TO YOUR FIRST CONTENTION, ARTICLE 21 OF THE IFB REQUIRES THE CONTRACTOR TO DEPROCESS AND PERFORM CERTAIN MINIMAL CLEANING AND ADJUSTMENT SERVICES IN STARTING THE ENGINES AND EFFECTING PROPER OPERATION THEREOF AT NO COST TO THE GOVERNMENT; TO ANALYZE THOSE ENGINES WHICH DO NOT THEREAFTER OPERATE PROPERLY; AND TO REPLACE OR REPAIR ANY OF CERTAIN SPECIFIED COMPONENTS AT AN HOURLY LABOR RATE BID BY THE CONTRACTOR. NECESSARY REPLACEMENT PARTS ARE TO BE FURNISHED BY THE GOVERNMENT AND THE TOTAL AMOUNT PAYABLE TO THE CONTRACTOR FOR SUCH REPAIR SERVICES IS LIMITED BY PARAGRAPH (E) (3) OF ARTICLE 21 TO ONE THIRD OF THE PRODUCT OF THE HOURLY RATE BID MULTIPLIED BY THE TOTAL NUMBER OF ENGINES FURNISHED. PARAGRAPH (E) (4) RESTRICTS TO 3 HOURS THE AMOUNT OF REPAIR WORK THAT MAY BE EXPENDED ON A SINGLE ENGINE. AT THE END OF ARTICLE 21 THE FOLLOWING NOTE APPEARS: "FOR EVALUATION PURPOSES ONLY THE MAXIMUM HOURS (3) SHOWN IN PARAGRAPH E (4) (SIC) ABOVE WILL BE MULTIPLIED BY TOTAL QUANTITY OF 5 KW, 60 HZ GENERATOR SETS SET FORTH IN THE SCHEDULE. THE ABOVE PRODUCT WILL BE MULTIPLIED BY THE HOURLY RATE SET FORTH IN PARAGRAPH E (3) (SIC) ABOVE, AND THIS SECOND PRODUCT WILL BE ADDED TO THE TOTAL CONTRACT PRICE FOR BOTH ALTERNATE -A- AND -B- PROPOSALS.'

CONCERNING YOUR CONTENTION THAT ENGINE REPAIRS SHOULD BE EVALUATED ON THE BASIS OF ONE-THIRD MAN-HOUR IRRESPECTIVE OF WHAT THE SOLICITATION STATED, WE DO NOT AGREE THAT GENERAL STATEMENTS CONCERNING AWARD AND BID EVALUATION SUCH AS THOSE REFERRED TO ABOVE IN PARAGRAPHS 10 (A) AND 29 OF THE INSTRUCTIONS SHOULD SUPERSEDE EXPRESS PROVISIONS CONCERNING THE EVALUATION OF SPECIFIC ITEMS. PARAGRAPH 2-201 (A) (XX) OF THE ARMED SERVICES PROCUREMENT REGULATION PROVIDES THAT INVITATIONS SHALL CONTAIN A STATEMENT OF THE EXACT BASIS UPON WHICH BIDS WILL BE EVALUATED AND AWARD MADE. ARTICLE 21 ESTABLISHES FOR A MULTIPLICATION FACTOR THE THREE HOURS SPECIFIED IN PARAGRAPH E (4) AS THE MAXIMUM HOURS ALLOWED FOR REPAIRING AN ENGINE, AND IN OUR VIEW BIDDERS WERE THEREFORE NOT ENTITLED TO ASSUME THAT BIDS WOULD BE EVALUATED ON AN HOURLY FACTOR DIFFERENT THAN THAT WHICH WAS SPECIFICALLY DESIGNATED. IT IS WELL ESTABLISHED THAT BIDS MAY NOT BE EVALUATED ON A BASIS CONTRARY TO THAT STATED IN THE INVITATION. 10 COMP. GEN. 261. SUCH EVALUATION STANDARD WAS CLEARLY SET FORTH IN THE INVITATION, AND THE PROPER TIME FOR REGISTERING ANY OBJECTION TO ITS USE WAS UPON RECEIPT OF THE IFB.

WE AGREE, HOWEVER, WITH YOUR CONTENTION THAT THE REPAIR FACTOR SHOULD NOT HAVE EXCEEDED THE MAXIMUM NUMBER OF HOURS FOR WHICH THE GOVERNMENT IS OBLIGATED TO REIMBURSE THE CONTRACTOR FOR SUCH REPAIRS, AND BELIEVE THAT A MORE APPROPRIATE HOURLY EVALUATION FACTOR WOULD HAVE BEEN THE ALLOWABLE AVERAGE OF ONE-THIRD HOUR AN ENGINE, ASSUMING THAT AVERAGE IS REALISTIC. IT APPEARS THE CONTRACTING OFFICER USED THE THREE-HOUR STANDARD ON THE BASIS THAT THE GOVERNMENT HAS EXPERIENCED CONSIDERABLE DIFFICULTY WITH MILITARY STANDARD ENGINES, AND FOR SUCH REASON PROVISION WAS MADE IN ARTICLE 21 (E) (5) FOR NOTICE TO THE CONTRACTING OFFICER SHOULD EXPERIENCE OF THE CONTRACTOR MAKE IT APPEAR THAT MORE WORK WOULD BE REQUIRED UNDER THE CONTRACT THAN WAS AUTHORIZED FOR PAYMENT. WE DO NOT REGARD SUCH SPECULATION CONCERNING POSSIBLE ADDITIONAL REQUIREMENTS AS ADEQUATE JUSTIFICATION FOR ESTABLISHING EVALUATION FACTORS INCONSISTENT WITH THE OBLIGATIONS UNDER THE PROPOSED CONTRACT.

YOU POINT OUT THAT IN A MORE RECENT SOLICITATION (IFB NO. DAAK01-68 B- 4752) BY THE ARMY MOBILITY EQUIPMENT COMMAND FOR 10 KW 60-HERTZ GENERATOR SETS THE ONE-THIRD HOUR FACTOR WAS USED IN THE EVALUATION OF THE COST OF ENGINE REPAIR SERVICES, AND A 4 PERCENT FIGURE WAS USED FOR ENGINE RETURNS. WE CANNOT AGREE THAT THE ADOPTION OF A MORE REASONABLE EVALUATION FACTOR IN A SUBSEQUENT PROCUREMENT NECESSITATES THE CONCLUSION THAT THE DIFFERENT PROVISIONS IN THE SUBJECT PROCUREMENT PRECLUDE A VALID AWARD THEREUNDER. IN ANY EVENT, USE OF ONE-THIRD HOUR INSTEAD OF THREE HOURS IN THE EVALUATION IN THE PRESENT INSTANCE WOULD NOT IN ITSELF MAKE YOUR BID LOWER THAN FERMONT-S, ALTHOUGH IT WOULD REDUCE THE ADDITION TO YOUR BID TO ONE-NINTH OF THE AMOUNT USED IN THE EVALUATION BY THE CONTRACTING OFFICER. SINCE FERMONT OFFERED THE REQUIRED REPAIRS WITHOUT CHARGE EVALUATION OF ITS BID WOULD NOT BE AFFECTED. YOUR SECOND CONTENTION INVOLVES THE REQUIREMENT OF ARTICLE 21 THAT IF AFTER THE REQUIRED EFFORT TO REPAIR AN ENGINE, THE ENGINE FAILS TO OPERATE PROPERLY THE CONTRACTOR SHALL DISPOSE OF IT IN ACCORDANCE WITH PARAGRAPH (F). PARAGRAPH (F) PROVIDES:

"/F) DISPOSITION OF ENGINES, PARTS AND ACCESSORIES WHICH FAIL TO OPERATE PROPERLY AFTER ALL OF THE PROVISIONS OF THIS ARTICLE HAVE BEEN ACCOMPLISHED SHALL BE MADE ON A MONTHLY BASIS. THE CONTRACTOR WILL PACK ENGINES IN THEIR ORIGINAL CARTONS, BOXES OR RACKS AND PARTS WILL BE PACKAGED IN THE ORIGINAL CONTAINER OF THE REPLACEMENT PART WHENEVER POSSIBLE. AS A MINIMUM, THE PACKAGING LEVEL SHALL BE EQUIVALENT TO THAT IN WHICH THEY WERE RECEIVED AND ADEQUATE TO PREVENT PHYSICAL DAMAGES DURING SHIPMENT TO DESTINATION. EACH PACKAGE WILL BE MARKED WITH FSN, QUANTITY AND THE LETTER -R- INDICATING REJECTED PARTS. THE OUTSIDE OF THE SHIPPING CONTAINER WILL INCLUDE THE CONTRACTORS NAME, CONTRACT NO. AND ANNOTATION: -REJECTED ENGINE PARTS-. THE GOVERNMENT SHALL REIMBURSE THE CONTRACTOR FOR WORK REQUIRED UNDER THIS PARAGRAPH AT THE RATE OF ----- PER MAN HOUR AND FOR ANY PACKAGING MATERIALS REQUIRED IN ADDITION TO THE ORIGINAL CONTAINERS. SHIPMENT WILL BE MADE FOB THE CONTRACTOR'S PLANT ON GOVERNMENT BILLS OF LADING, AND WILL BE ADDRESSED TO: * * *.' YOUR BID INCLUDED A FIGURE OF $7.71 IN THE ABOVE BLANK, AND FERMONT INSERTED $20.

NO PROVISION IS MADE FOR INCLUSION OF THE COST OF PACKAGING RETURNABLE ENGINES IN THE EVALUATION OF BIDS, AND PARAGRAPH 34 (7) OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS, TOGETHER WITH ARTICLE 20, STATE THAT FREIGHT ON GOVERNMENT FURNISHED PROPERTY WILL NOT BE AN EVALUATION FACTOR.

YOU CONTEND THAT IN VIEW OF THE STATEMENTS IN PARAGRAPHS 10 (A) AND 29 OF THE INSTRUCTIONS, BIDDERS WERE ENTITLED TO ASSUME THAT BIDS WOULD BE EVALUATED ON THE BASIS OF ALL PRICED ITEMS AND OVER-ALL COST TO THE GOVERNMENT. WITH RESPECT TO THE COST OF RETURN OF ENGINES, YOU PROPOSE NOT ONLY THAT THE HOURLY RATES FOR PACKAGING QUOTED BY THE BIDDERS SHOULD BE USED IN BID EVALUATION, BUT THAT THOSE RATES SHOULD BE APPLIED "ON THE BASIS OF OBJECTIVE, HISTORICAL RECORDS OF PERFORMANCE -- FOR ONLY IN THIS WAY CAN THE TRUE COST TO THE GOVERNMENT BE PREDICTED, AND IN AN OBJECTIVE MANNER.'

IN THIS CONNECTION, YOU SAY THAT YOUR FIRM HAS A HISTORICAL RETURN RATE OF .7 PERCENT, AND YOU STATE THAT FERMONT HAS A RETURN RATE OF APPROXIMATELY 17 PERCENT, WHEREAS FERMONT STATES THAT IN ITS PRIOR EXPERIENCE WITH GOVERNMENT FURNISHED ENGINES FOR THE 5 KW GENERATOR SETS THAT FIRM HAS RETURNED 39 ENGINES OUT OF A TOTAL OF 3,564 ENGINES FOR A RETURN RATE OF APPROXIMATELY 1.09 PERCENT. THE CONTRACTING OFFICER HAS REPORTED THAT COMPARATIVE FACTUAL DATA ON RETURNABLE ENGINES IS NOT AVAILABLE BECAUSE OF DIFFERENCES IN CONTRACT REQUIREMENTS CONCERNING REPAIR OF DEFECTIVE ENGINES, DIFFERENCES IN ENGINE PRODUCTION RUNS, AND BECAUSE RETURNABLE ENGINES WERE REPAIRED AT VARIOUS TIMES BY GOVERNMENT AND ENGINE CONTRACTOR PERSONNEL AT BOTH ONAN AND FERMONT PLANTS. IN VIEW OF SUCH FACTORS THE CONTRACTING OFFICER HAS CONCLUDED THAT ANY DIFFERENCE IN RATES OF RETURN OF ENGINES CANNOT BE CONSTRUED AS A LESS FAVORABLE RECORD OF PERFORMANCE BY EITHER CONTRACTOR SINCE THE CONTRACTUAL REQUIREMENTS AND OTHER CONDITIONS WERE NOT COMPARABLE. WE REGARD THE CONTRACTING OFFICER'S CONCLUSION AS BEING REASONABLE. IRRESPECTIVE OF THE AVAILABILITY OF COMPARATIVE ENGINE RETURN RATES FOR YOUR FIRM AND FERMONT, WE DO NOT AGREE WITH YOUR CONTENTION THAT SUCH RATES CONSTITUTE PROPER BID EVALUATION FACTORS FOR THE INDIVIDUAL BIDDERS. OBVIOUSLY, THE USE OF PRIOR CONTRACTORS' RETURN RATES WOULD PROVIDE NO RATE FOR EVALUATING THE BID OF A PROSPECTIVE NEW CONTRACTOR AND WOULD NOT THEREFORE PERMIT EVALUATION OF ALL BIDS ON A COMMON BASIS. HOWEVER, WHERE A BID PRICE IS REQUIRED ON PACKAGING SERVICES ON REJECTED ENGINES, WE BELIEVE IT WOULD BE MORE APPROPRIATE TO PROVIDE SOME METHOD OF EVALUATION OF THE COST OF SUCH SERVICES IF THE AGENCY COULD DETERMINE FROM PAST EXPERIENCE OR OTHERWISE A DEFECTIVE ENGINE RETURN RATE WHICH COULD REASONABLY BE ANTICIPATED. THE RECORD BEFORE US WE FIND NO BASIS WHATEVER FOR USE OF THE 17 PERCENT RETURN RATE PROPOSED BY YOU FOR EVALUATION OF THE FERMONT BID. NEITHER DO WE FIND ANY SUPPORTABLE BASIS FOR AN EVALUATION OF THESE COSTS IN A MANNER WHICH WOULD CHANGE THE RELATIVE STANDING OF THE BIDS, EVEN IF YOUR OTHER PROPOSED ADJUSTMENTS WERE APPLIED.

CONCERNING THE ITEM OF TECHNICAL ASSISTANCE, WHICH YOU OFFERED WITHOUT CHARGE AND ON WHICH FERMONT QUOTED A RATE OF $1,000 PER MAN DAY, ARTICLE 13I, CONCERNING GOVERNMENT INITIAL PRODUCTION TESTING, CONCURRENTLY WITH DELIVERY, OF THE FIRST PRODUCTION LOT OF TWO ITEMS EACH OF THE 5 KW 60- HERTZ AND 5 KW 400-HERTZ UNITS, REQUIRES UNDER SUBPARAGRAPH (3), AS MODIFIED, THAT THE CONTRACTOR PROVIDE ON-SITE TECHNICAL ASSISTANCE DURING THE PERIOD OF TESTING AT A COST PER MAN-DAY BID BY THE CONTRACTOR. HOWEVER, SUBPARAGRAPH (6) STATES THAT THE CONTRACTING OFFICER MAY WAIVE THE TESTING REQUIREMENT IF A BIDDER HAS PREVIOUSLY PRODUCED AN ESSENTIALLY IDENTICAL ITEM. WAIVER OF PREPRODUCTION MODEL TESTING BY THE CONTRACTOR OF EACH OF THE TWO UNITS IS AUTHORIZED UNDER ARTICLE 15 IF A BIDDER HAS PRODUCED AN ACCEPTABLE ARTICLE WITHIN 365 DAYS PRIOR TO THE OPENING DATE FOR BIDS. BIDDERS WHO CLAIM QUALIFICATION FOR WAIVER OF PREPRODUCTION MODEL TESTING ARE REQUIRED TO SPECIFY UNDER ARTICLE 15 THE AMOUNT OF REDUCTION IN BID PRICE FOR WAIVER OF TESTING ON EACH OF THE TWO UNITS. IS OUR UNDERSTANDING THAT YOU ARE ENTITLED TO WAIVER OF THE TESTING ON BOTH TYPES OF GENERATORS, BUT YOU CONTEND THAT FERMONT IS ENTITLED TO WAIVER ONLY AS TO ONE. NO QUESTION HAS BEEN RAISED AS TO THE PROPRIETY OF THE CONTRACTING OFFICER'S BID EVALUATION OF THESE WAIVERS, BUT SINCE NO COST FOR TECHNICAL ASSISTANCE WOULD BE INCURRED IN EVENT OF AWARD TO YOU, WHEREAS IT IS YOUR VIEW THAT FERMONT WOULD HAVE TO FURNISH SUCH ASSISTANCE ON ONE OF THE TWO TYPES OF GENERATORS AND WOULD BE ENTITLED TO BE PAID THEREFORE AT THE RATE OF $1,000 PER MAN-DAY, YOU URGE THAT A FAIR ESTIMATE OF THE COST THEREOF SHOULD BE ADDED TO THE FERMONT BID FOR PROPER EVALUATION. YOUR ESTIMATE OF A REASONABLE FIGURE FOR THIS ITEM IS $5,000.

WE ARE INCLINED TO AGREE WITH YOUR CONTENTION THAT PROVISION SHOULD HAVE BEEN MADE FOR INCLUDING SOME COST OF TECHNICAL ASSISTANCE AS AN ITEM FOR EVALUATION, WHERE A BIDDER WAS NOT ELIGIBLE FOR ITS WAIVER. HOWEVER, WE NOTE THAT EVEN IF FERMONT WAS NOT ELIGIBLE, AS YOU SAY, FOR WAIVER OF INITIAL PRODUCTION TESTING ON THE 400-HERTZ SETS THE ADDITION TO FERMONT'S BID OF THE $5,000 FIGURE WHICH YOU PROPOSE WOULD NOT SIGNIFICANTLY AFFECT THE DIFFERENCE BETWEEN THE BIDS, AND IN VIEW OF THE ADMINISTRATIVE POSITION THAT FERMONT IS ELIGIBLE FOR WAIVER OF ALL TESTING WE FIND NO GROUND TO DISTURB THE CONTRACTING OFFICER'S EVALUATION.

AS TO YOUR ALLEGATION OF AN ATTEMPT BY FERMONT TO "BUY IN," WE FIND NO SUBSTANTIAL SUPPORT FOR SUCH A CHARGE, NOR ARE WE AWARE OF ANY SPECIFIC LEGAL PROHIBITION AGAINST ACCEPTANCE OF A BID ON THAT GROUND.

SINCE BIDS WERE OPENED WITHOUT ANY OBJECTION BY YOU TO THE EVALUATION CRITERIA, AND SINCE IT APPEARS THAT FERMONT IS THE LOW BIDDER PURSUANT TO THE EVALUATION CRITERIA DESIGNATED IN THE INVITATION AND COULD BE DISPLACED ONLY BY ARBITRARY SELECTION OF EVALUATION FACTORS MOST FAVORABLE TO YOU AND NOT PROVIDED IN THE INVITATION, WE CONCLUDE THAT WE WOULD NOT BE LEGALLY JUSTIFIED EITHER IN OBJECTING TO AWARD OF A CONTRACT IN ACCORDANCE WITH THE CONTRACTING OFFICER'S EVALUATION OF BIDS, OR IN REQUIRING READVERTISING OF THE PROCUREMENT. YOUR PROTEST MUST THEREFORE BE DENIED.

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