B-174791, OCT 20, 1972

B-174791, OCT 20, 1972

BID PROTEST - SOLE SOURCE AWARD - BASIC ORDERING AGREEMENT - SMALL PURCHASES - PUBLIC EXIGENCY - FINALITY OF FINDINGS DENIAL OF PROTEST ON BEHALF OF STERLING LABORATORIES AGAINST THE AWARD OF A SERIES OF CONTRACTS TO ITT-GILFILLAN, INC. (ITT-G), UNDER A BASIC ORDERING AGREEMENT ISSUED AT TINKER AFB, OK. SINCE THE SYNOPSIS OF THE PROCUREMENT IN THE COMMERCE BUSINESS DAILY ADVISED QUALIFIED FIRMS THAT THEY COULD OBTAIN A BID SET IF THEY PROVIDED THE REQUIRED CERTIFICATION, AND SINCE STERLING FAILED TO REQUEST THE BID SET OR TO SUPPLY THE CERTIFICATE, THE SOLE SOURCE AWARD OF SD34 TO ITT-G UNDER 10 U.S.C. 2304(A)(10) WAS PROPER BECAUSE THE GOVERNMENT DID NOT HAVE SUFFICIENT DRAWINGS AND DESCRIPTIVE DATA TO MAKE COMPETITIVE BIDDING PRACTICABLE. THE AWARD OF DELIVERY ORDERS TO ITT-G UNDER THE SMALL PURCHASE EXCEPTION OF 10 U.S.C. 2034(A)(3) WAS CLEARLY PROPER SINCE THERE HAD BEEN COMPETITION AND ITT-G PROVIDED THE LOWEST PRICE. WHILE THE DETERMINATIONS MADE BY THE CONTRACTING OFFICER UNDER SECTION 2304(A) ARE NOT FINAL, ALTHOUGH THE FINDINGS OF FACT ARE, THERE IS NOTHING IN THE RECORD TO INDICATE ANY IMPROPRIETY IN THE ISSUANCE OF THESE DELIVERY ORDERS. FURTHER, ALTHOUGH A DETERMINATION UNDER THE "PUBLIC EXIGENCY" EXCEPTION DOES NOT PER SE AUTHORIZE A SOLE SOURCE PROCUREMENT, THE CONTRACTING OFFICER IS VESTED WITH CONSIDERABLE DISCRETION IN DETERMINING THE EXTENT OF NEGOTIATIONS REQUIRED AND, WHERE IT DOES NOT APPEAR THAT THE DISCRETION WAS EXERCISED IN AN ARBITRARY OR CAPRICIOUS MANNER, GAO WILL NOT OBJECT TO THE DECISION TO LIMIT NEGOTIATIONS TO A SINGLE SOURCE. THE FACT THAT STERLING PREVIOUSLY SUPPLIED SIMILAR ITEMS DOES NOT CONCLUSIVELY PROVE THAT THE NONCOMPETITIVE AWARDS WERE IMPROPER. ACCORDINGLY, THE PROTEST IS DENIED.

TO ISRAEL AND MANESS:

FURTHER REFERENCE IS MADE TO YOUR LETTERS OF DECEMBER 2, 1971, AND MARCH 22, JUNE 23, AND AUGUST 15, 1972, PROTESTING ON BEHALF OF STERLING LABORATORIES (STERLING) THE AWARD OF CONTRACTS TO ITT GILFILLAN, INC. (ITT -G) UNDER BASIC ORDERING AGREEMENT NO. F04606-71-A 0050, ISSUED AT TINKER AIR FORCE BASE, OKLAHOMA.

YOUR PROTEST WAS SPECIFICALLY CONCERNED WITH THE AWARD OF A CONTRACT TO ITT-G THROUGH THE ISSUANCE OF ORDER NO. SD34 UNDER THE BASIC ORDERING AGREEMENT (BOA) HELD BY THAT FIRM. YOU ALLEGE THAT A NOTICE OF THE AWARD IN THE OCTOBER 27, 1971, ISSUE OF THE COMMERCE BUSINESS DAILY (CBD) WAS THE FIRST INDICATION TO STERLING THAT THE AIR FORCE HAD AWARDED A SERIES OF 34 CONTRACTS TO ITT-G, AS A SOLE SOURCE, FOR EQUIPMENT FOR WHICH STERLING WAS A POTENTIAL SUPPLIER. YOU MAINTAIN THAT THE SERIES OF CONTRACTS AWARDED TO ITT-G UNDER ITS BOA TOTALLY AND SYSTEMATICALLY EXCLUDED STERLING FROM COMPETITION, IN VIOLATION OF THE PREFERENCES FOR FORMALLY ADVERTISED PROCUREMENT AND COMPETITIVELY NEGOTIATED PROCUREMENT EXPRESSED IN 10 U.S.C. 2304(A) AND (G), AND ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1-300.1, 2-102.1(A), 3 101, 3-102(B) AND (C), AND 3- 410.2(C).

ORDER NO. SD34 AROSE FROM A REQUIREMENT FOR TWO DIFFERENT MODIFICATION KITS, APPLICABLE TO RADAR EQUIPMENT, TO BE SUPPLIED TO SPAIN UNDER THE MILITARY ASSISTANCE PROGRAM. A DRAWING WAS MISSING FROM THE DATA PACKAGE FOR ONE KIT, WHILE SEVERAL DRAWINGS WERE UNCLEAR IN THE DATA FOR THE OTHER KIT, PRECLUDING PROCUREMENT OF THE KITS BY FORMAL ADVERTISING. ADDITIONALLY, SINCE ITT-G HAD BEEN THE DESIGNER AND ONLY PROVEN PREVIOUS MANUFACTURER OF THE EQUIPMENT, IT WAS THE ONLY KNOWN SOURCE TO THE GOVERNMENT.

A PREAWARD SYNOPSIS OF THE PROCUREMENT IN THE CBD ADVISED THAT A REQUEST FOR QUOTATION HAD BEEN ISSUED TO ITT-G, AND STATED IN NOTE 5 REFERENCED THEREIN:

"THE PROPOSED PROCUREMENT HAS BEEN SYNOPSIZED SOLELY FOR THE PURPOSE OF REFLECTING SUB-CONTRACTING OPPORTUNITIES WHICH MAY OR MAY NOT BE AVAILABLE. THE FIRMS LISTED IN THE COMMERCE BUSINESS DAILY ARE THE ONLY FIRMS KNOWN TO THE PROCURING ACTIVITY WHICH HAVE THE FACILITIES, DATA, AND TECHNICAL KNOWLEDGE NECESSARY TO MEET THE PROCUREMENT REQUIREMENTS. FOR THOSE REASONS, SOLICITATION HAS BEEN LIMITED TO THOSE KNOWN FIRMS.

"ANY FIRM NOT LISTED IN THIS PUBLISHED NOTICE MAY OBTAIN A BID SET FOR DIRECT BIDDING ONLY BY FURNISHING A WRITTEN STATEMENT SIGNED BY A CORPORATE OFFICIAL OF THE COMPANY, CERTIFYING THAT THE COMPANY POSSESSES THE LATEST DATA, AND THE FACILITIES, EQUIPMENT AND TECHNICAL KNOW-HOW TO PERFORM AS A PRIME CONTRACTOR ON THE PROCUREMENT CONCERNED.

"REQUESTS FOR BID SETS FOR THIS PROCUREMENT WILL NOT BE HONORED WITHOUT THE PRESCRIBED CERTIFICATE FROM CORPORATE LEVEL."

IT THEREFORE APPEARS THAT HAD STERLING FURNISHED THE APPROPRIATE CERTIFICATION, IT COULD HAVE OBTAINED A BID SET AND COMPETED FOR THE PROCUREMENT. HOWEVER, THERE WERE NO REQUESTS FOR COPIES OF THE SOLICITATION AS A RESULT OF THE CBD SYNOPSIS. THUS, THE PROCUREMENT WAS CONDUCTED SOLELY WITH ITT-G UNDER THE AUTHORITY OF 10 U.S.C. 2304(A)(10), WHICH PROVIDES:

"(A) PURCHASES OF AND CONTRACTS FOR PROPERTY OR SERVICES COVERED BY THIS CHAPTER SHALL BE MADE BY FORMAL ADVERTISING IN ALL CASES IN WHICH THE USE OF SUCH METHOD IS FEASIBLE AND PRACTICABLE UNDER THE EXISTING CONDITIONS AND CIRCUMSTANCES. IF USE OF SUCH METHOD IS NOT FEASIBLE AND PRACTICABLE, THE HEAD OF AN AGENCY, SUBJECT TO THE REQUIREMENTS FOR DETERMINATIONS AND FINDINGS IN SECTION 2310, MAY NEGOTIATE SUCH A PURCHASE OR CONTRACT, IF -

(10) THE PURCHASE OR CONTRACT IS FOR PROPERTY OR SERVICES FOR WHICH IT IS IMPRACTICABLE TO OBTAIN COMPETITION."

IN IMPLEMENTATION THEREOF, ASPR 3-210.2(XV) PROVIDES AS AN ILLUSTRATIVE CIRCUMSTANCE WHEN THIS AUTHORITY MAY BE USED:

"WHEN THE CONTEMPLATED PROCUREMENT IS FOR PARTS OR COMPONENTS BEING PROCURED AS REPLACEMENT PARTS IN SUPPORT OF EQUIPMENT SPECIALLY DESIGNED BY THE MANUFACTURER, WHERE DATA AVAILABLE IS NOT ADEQUATE TO ASSURE THAT THE PART OR COMPONENT WILL PERFORM THE SAME FUNCTION IN THE EQUIPMENT AS THE PART OR COMPONENT IT IS TO REPLACE."

PURSUANT TO THESE AUTHORITIES AND 10 U.S.C. 2310(B)(6), THE CONTRACTING OFFICER DETERMINED THAT IT WAS "IMPRACTICABLE TO OBTAIN COMPETITION BY FORMAL ADVERTISING OR COMPETITIVE NEGOTATION" FOR THE SUPPLY OF THE MODIFICATION KITS. THIS DETERMINATION WAS BASED UPON THE FOLLOWING FINDINGS:

"2. PROCUREMENT BY NEGOTIATION OF THE ABOVE-DESCRIBED SPECIAL SUPPORT EQUIPMENT IS NECESSARY BECAUSE THE MANUFACTURER MUST HAVE A DETAILED KNOWLEDGE OF THE BASIC EQUIPMENT TO BE SUPPORTED. THE SPECIAL SUPPORT EQUIPMENT TO BE PROCURED MUST BE SPECIALLY DESIGNED TO BE COMPATIBLE WITH THE BASIC EQUIPMENT.

"3. USE OF FORMAL ADVERTISING OR COMPETITIVE NEGOTIATION FOR PROCUREMENT OF THE ABOVE-DESCRIBED SPECIAL SUPPORT EQUIPMENT IS IMPRACTICABLE BECAUSE ONLY THE ABOVE-NAMED CONTRACTOR, THE DESIGNER, DEVELOPER AND SOLE MANUFACTURER OF THE BASIC EQUIPMENT, IS SUFFICIENTLY FAMILIAR WITH THE DESIGN AND OPERATIONAL CHARACTERISTICS OF THE BASIC EQUIPMENT TO FURNISH THE SPECIAL SUPPORT EQUIPMENT REQUIRED."

ADDITIONALLY, THE CONTRACTING OFFICER DETERMINED THAT "THIS PROCUREMENT WILL BE EFFECTED ON A NON-COMPETITIVE BASIS" IN VIEW OF HIS FINDING THAT:

"*** THE ITEMS ON THE PURCHASE REQUEST ARE CODED 3 'H' (IN ACCORDANCE WITH) AFLCR 57-6 AND REFLECT ONLY ONE SOURCE OF SUPPLY AND THAT THERE IS NO KNOWN SOURCE OTHER THAN THE RECOMMENDED SOURCE."

AIR FORCE REGULATION 57-6 (AFR 57-6) IS THE DESIGNATION GIVEN BY THAT DEPARTMENT TO A REGULATION ENTITLED "DEPARTMENT OF DEFENSE HIGH DOLLAR SPARE PARTS BREAKOUT PROGRAM (MARCH 1969)," WHICH IS APPLICABLE TO ALL COMPONENTS OF THE DEPARTMENT OF DEFENSE. PARAGRAPH 1-201.12(III) OF AFR 57-6 STATES THAT IN DENOTING THE PROCUREMENT STATUS OF SPARE PARTS, PROCUREMENT METHOD CODE "3" WILL APPLY TO:

"ITEMS SCREENED AND FOUND TO BE PROCURED DIRECTLY FROM THE ACTUAL MANUFACTURER OR VENDOR, INCLUDING A PRIME CONTRACTOR WHO IS THE ACTUAL MANUFACTURER."

PARAGRAPH 1-201.14 OF AFR 57-6 DEFINES THE SUFFIX CODES USED TO EXPLAIN THE PRIMARY REASON WHY THE PROCUREMENT METHOD CODE WAS ASSIGNED. A SUFFIX CODE OF "H" SIGNIFIES THAT:

"THE GOVERNMENT DOES NOT HAVE IN ITS POSSESSION SUFFICIENT, ACCURATE OR LEGIBLE DATA TO PURCHASE THIS ITEM FROM OTHER SOURCES. PROCUREMENT OF THIS ITEM MUST BE LIMITED TO CURRENT SOURCES)." AFR 57-6, PARAGRAPH 1- 201.14(VIII).

IN OUR OPINION, 10 U.S.C. 2310(B) CONFERS NO FINALITY ON THE CONTRACTING OFFICER'S DETERMINATION THAT IT WAS "IMPRACTICABLE TO OBTAIN COMPETITION BY FORMAL ADVERTISING OR COMPETITIVE NEGOTIATION." HOWEVER, WE ARE PRECLUDED BY THAT STATUTE FROM DISTURBING THE FINDINGS UPON WHICH THE EXCEPTION TO THE REQUIREMENT FOR FORMAL ADVERTISING WAS INVOKED. THEREFORE, "THE STATUTE DOES NOT PRECLUDE OUR QUESTIONING WHETHER THE DETERMINATION, BASED ON THOSE FINDINGS, IS PROPER." 51 COMP. GEN. (B- 174809, APRIL 20, 1972). UPON CONSIDERATION OF THE FINDINGS QUOTED ABOVE, WE ARE UNABLE TO CONCLUDE THAT IT WAS IMPROPER FOR THE CONTRACTING OFFICER TO HAVE DETERMINED THAT A COMPETITIVE PROCUREMENT WAS IMPRACTICABLE. OUR EXAMINATION OF THE RECORD SHOWS THAT, EXCEPT FOR THE LACK OF A REFERENCE TO AFR 57-6, ESSENTIALLY THE SAME DETERMINATION AND FINDINGS PRECEDED THE NONCOMPETITIVE PROCUREMENTS EFFECTED BY THE ISSUANCE OF DELIVERY ORDERS SD11, SD18, SD20, SD26, SD27, SD31 AND SD33 UNDER ITT-G'S BOA. THEREFORE, AS TO THESE ORDERS YOUR PROTEST IS DENIED.

DELIVERY ORDER SD09 WAS ISSUED TO ITT-G ON A NONCOMPETITIVE BASIS UNDER THE AUTHORITY OF 10 U.S.C. 2304(A)(10), AS IMPLEMENTED BY ASPR 3 210.2(I). THE LATTER PROVIDES FOR THE NEGOTIATION OF CONTRACTS "WHEN SUPPLIES OR SERVICES CAN BE OBTAINED FROM ONLY ONE PERSON OR FIRM ('SOLE SOURCE OF SUPPLY')." THE FINDINGS UPON WHICH THIS EXCEPTION TO THE REQUIREMENT FOR FORMAL ADVERTISING WAS BASED STATE:

"2. PROCUREMENT BY NEGOTIATION OF THE ABOVE-DESCRIBED SERVICES FROM (ITT -G) IS NECESSARY BECAUSE ADEQUATE GOVERNMENT-OWNED DRAWINGS/OR SPECIFICATIONS ARE NOT AVAILABLE. (ITT-G) IS THE BUILDER OF THE ORIGINAL EQUIPMENT AND IS THE ONLY KNOWN SOURCE HAVING THE CAPABILITY TO PRODUCE THE REQUIRED CARD ASSEMBLY.

"3. USE OF FORMAL ADVERTISING FOR PROCUREMENT OF THE ABOVE DESCRIBED SUPPLIES OR SERVICES IS IMPRACTICABLE BECAUSE NO OTHER SUPPLIER IS QUALIFIED TO FURNISH THE SUPPLIES OR SERVICES REQUIRED."

WE BELIEVE THESE FINDINGS, TO WHICH FINALITY IS ACCORDED BY STATUTE, SUPPORT THE USE OF THE NEGOTIATION AUTHORITY CITED AND THEREFORE WE DISCERN NO IMPROPRIETY IN THE ISSUANCE OF THIS DELIVERY ORDER.

DELIVERY ORDER SD25 WAS ISSUED TO ITT-G PURSUANT TO 10 U.S.C. 2304(A)(3), AS IMPLEMENTED BY ASPR 3-203.1, WHICH PERMIT THE USE OF NEGOTIATION IF THE CONTRACT INVOLVES AN AGGREGATE AMOUNT OF NOT MORE THAN $2,500. WE ARE ADVISED BY THE AIR FORCE THAT TEN FIRMS, INCLUDING STERLING, COMPETED FOR THIS REQUIREMENT. ITT-G SUBMITTED THE LOWEST PRICE AND AWARD WAS MADE UNDER ITS BOA RATHER THAN BY SEPARATE CONTRACT. SIMILARLY, WE ARE ADVISED THAT DELIVERY ORDER SD32 WAS ISSUED TO ITT-G AS A RESULT OF ITS SUBMITTAL OF THE LOWEST PRICE OF SIX FIRMS COMPETING FOR THE REQUIREMENT. WE REGARD YOUR PROTEST AS WITHOUT MERIT AS IT CONCERNS THESE DELIVERY ORDERS, SINCE THEY WERE ISSUED FOLLOWING COMPETITIVE SOLICITATIONS.

DELIVERY ORDER SD02 WAS ISSUED TO ITT-G ON A NONCOMPETITIVE BASIS UNDER THE AUTHORITY OF 10 U.S.C. 2304(A)(10) AND ASPR 3-210.2(XV), PURSUANT TO THE FOLLOWING FINDINGS:

"2. PROCUREMENT BY NEGOTIATION OF THE PARTS OR COMPONENTS REQUIRED AS REPLACEMENT PARTS IN SUPPORT OF THE EQUIPMENT DESCRIBED ABOVE IS NECESSARY BECAUSE FULLY ADEQUATE DATA AND QUALITY ASSURANCE PROCEDURES ARE NOT AVAILABLE AND CANNOT REASONABLY BE MADE AVAILABLE. ONLY THE ABOVE-NAMED DESIGNER AND MANUFACTURER OF THE EQUIPMENT IS CAPABLE OF FURNISHING PARTS OR COMPONENTS WHICH ASSURE THE REQUISITE SAFE, DEPENDABLE AND EFFECTIVE OPERATION OF THE EQUIPMENT.

"3. USE OF FORMAL ADVERTISING IS IMPRACTICABLE BECAUSE THE DATA AVAILABLE ARE NOT ADEQUATE TO ASSURE THAT THE PART OR COMPONENT WILL PERFORM THE SAME FUNCTION IN THE EQUIPMENT AS THE PART OR COMPONENT IT IS TO REPLACE."

SIMILAR CIRCUMSTANCES SURROUNDED THE ISSUANCE OF DELIVERY ORDERS SD13, SD15, SD19, SD21, SD23, AND SD29 ON A NONCOMPETITIVE BASIS UNDER THE BOA HELD BY ITT-G. IN VIEW OF THE FINDINGS QUOTED ABOVE, WE DO NOT REGARD SUCH NEGOTIATION WITH ITT-G TO HAVE RESULTED FROM AN ABUSE OF DISCRETION BY THE CONTRACTING AGENCY, AND THEREFORE IT WILL NOT BE QUESTIONED BY OUR OFFICE.

WE ARE OF THE SAME OPINION IN REGARD TO DELIVERY ORDER SD14, ISSUED TO ITT-G PURSUANT TO 10 U.S.C. 2304(A)(10), AS IMPLEMENTED BY ASPR 3 210.2(XV). THE FOLLOWING FINDINGS WERE MADE IN CONNECTION WITH THIS DELIVERY ORDER:

"PROCUREMENT BY NEGOTIATIONS OF THE ABOVE DESCRIBED MOD KITS IS NECESSARY BECAUSE COMPLETE DRAWINGS AND SPECIFICATIONS ARE NOT AVAILABLE FOR COMPETITION. SOME ADDITIONAL DESIGN AND ENGINEERING MAY BE REQUIRED BY THE CONTRACTOR. THE PERFORMANCE SPECIFICATION IS NOT SUFFICIENTLY DETAILED TO PERMIT ADVERTISED BIDDING. THE DESIGN DATA AVAILABLE ARE INCOMPLETE; NOT SUFFICIENTLY DETAILED AND ARE LARGELY UNCOORDINATED."

ALTHOUGH IT MAY HAVE BEEN MORE APPROPRIATE FOR THE CONTRACTING OFFICER TO HAVE CITED THE EXAMPLE SET FORTH IN ASPR 3-210.2(XIII), WE DO NOT BELIEVE THIS IS OF LEGAL SIGNIFICANCE IN THE INSTANT CASE.

ELEVEN OF THE REMAINING DELIVERY ORDERS WERE NONCOMPETITIVELY NEGOTIATED WITH ITT-G UNDER THE AUTHORITY TO NEGOTIATE SMALL PURCHASES, 10 U.S.C. 2304(A)(3), AS IMPLEMENTED BY ASPR 3-203.1. IT IS ADMINISTRATIVELY REPORTED THAT ITT-G WAS THE ONLY KNOWN PRODUCER OF THE ITEMS PROCURED UNDER DELIVERY ORDERS SD06, SD08, SD17, SD22 AND SD28. ADDITIONALLY, THESE ORDERS (WHICH RANGED IN VALUE FROM $121.95 TO $253.83) WERE ASSIGNED A PROCUREMENT METHOD CODE SUFFIX OF "L" PURSUANT TO AFR 57-6, PARAGRAPH 1- 201.14(XI), WHICH STATES:

"THE LOW DOLLAR VALUE OF PROCUREMENTS MAKES IT UNECONOMICAL TO UNDERTAKE TO IMPROVE THE PROCUREMENT STATUS OF THIS ITEM."

WITH REGARD TO THE OTHER DELIVERY ORDERS ISSUED TO ITT-G UNDER THE SMALL PURCHASE EXCEPTION (SD03, SD07, SD12, SD16, SD24 AND SD30) IT IS THE POSITION OF THE AIR FORCE THAT ITT-G IS "THE ONLY KNOWN PRODUCER AND THE REPROCUREMENT DATA WAS EITHER NOT AVAILABLE, OR UNSUITABLE." UNDER THESE CIRCUMSTANCES, THE RECORD DOES NOT PROVIDE A BASIS UPON WHICH WE COULD LEGALLY OBJECT TO THE AWARDS TO ITT-G ON A NONCOMPETITIVE BASIS UNDER THE "SMALL PURCHASES" NEGOTIATION AUTHORITY.

FINALLY, DELIVERY ORDER SD10 WAS NEGOTIATED WITH ITT-G ON A NONCOMPETITIVE BASIS UNDER THE "PUBLIC EXIGENCY" EXCEPTION TO THE REQUIREMENT FOR FORMAL ADVERTISING, 10 U.S.C. 2304(A)(2), AS IMPLEMENTED BY ASPR 3-202.2(VI). THE LATTER PROVIDES AS AN ILLUSTRATIVE CIRCUMSTANCE OF A PUBLIC EXIGENCY:

"PURCHASE REQUEST CITING AN ISSUE PRIORITY DESIGNATOR 1 THROUGH 6, INCLUSIVE, UNDER THE UNIFORM MATERIEL MOVEMENT AND ISSUE PRIORITY SYSTEM (UMMIPS)." THE PURCHASE REQUEST FOR THIS REQUIREMENT BORE A UMMIPS PRIORITY DESIGNATOR OF "02". ADDITIONALLY, IT IS REPORTED THAT ITT-G WAS THE ONLY KNOWN PRODUCER OF THE ITEM AND THAT SUITABLE REPROCUREMENT DATA WAS UNAVAILABLE.

ALTHOUGH A DETERMINATION UNDER THE "PUBLIC EXIGENCY" EXCEPTION THAT FORMAL ADVERTISING IS IMPRACTICABLE DOES NOT PER SE AUTHORIZE A SOLE SOURCE PROCUREMENT, THE CONTRACTING AGENCY IS VESTED WITH CONSIDERABLE DISCRETION UNDER THIS EXCEPTION IN DETERMINING THE EXTENT OF NEGOTIATIONS TO BE CONDUCTED. WHERE, AS HERE, IT DOES NOT CLEARLY APPEAR FROM THE RECORD THAT THE CONTRACTING AGENCY HAS EXERCISED THAT DISCRETION IN AN ARBITRARY OR CAPRICIOUS MANNER, OUR OFFICE WILL NOT QUESTION THE DECISION TO LIMIT THE NEGOTIATION TO A SINGLE SOURCE. 44 COMP. GEN. 590, 593 (1965).

IN FURTHER SUPPORT OF YOUR CONTENTION THAT THE NONCOMPETITIVE AWARDS TO ITT-G WERE IMPROPER, YOU OBSERVE THAT STERLING SUPPLIED "SIMILAR ARTICLES" UNDER A "SIMILAR BOA FOR THE CALENDAR YEAR 1970." THE AIR FORCE DID NOT RENEW STERLING'S BOA FOR 1971 SINCE ONLY THREE ORDERS, OF LOW DOLLAR VALUE, WERE ISSUED THEREUNDER IN 1970. YOU CONTEND THAT THE NONRENEWAL OF STERLING'S BOA IS INCONSISTENT WITH THE ISSUANCE OF 34 ORDERS UNDER ITT- G'S BOA IN 1971. WHILE STERLING MAY HAVE SUPPLIED "SIMILAR" ITEMS IN THE PAST, WE NOTE THAT YOU DO NOT ALLEGE THAT STERLING HAS SUPPLIED THE SAME ITEMS PROCURED FROM ITT-G. IN VIEW OF THE REASONS GIVEN BY THE AIR FORCE FOR THE ISSUANCE OF DELIVERY ORDERS TO ITT-G, WE DO NOT BELIEVE THE FACT THAT STERLING PREVIOUSLY SUPPLIED SIMILAR ITEMS CONCLUSIVELY DEMONSTRATES THAT THE NONCOMPETITIVE AWARDS WERE IMPROPER.

ACCORDINGLY, YOUR PROTEST IS DENIED.