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B-149265, OCT. 19, 1962

B-149265 Oct 19, 1962
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A COPY OF WHICH WAS FURNISHED TO US. CONTAINED THE FOLLOWING PROVISION: "NOTE: AWARD WILL BE MADE ONLY TO A BIDDER WHOSE COMMERCIAL EQUIVALENTS OF THE EQUIPMENTS DESCRIBED IN THIS INVITATION HAVE. BIDDERS SHALL FURNISH WITH THEIR BIDS THE TYPE NUMBERS OF SUCH COMMERCIAL EQUIVALENTS WHICH ARE LISTED IN THE FCC "RADIO EQUIPMENT LIST. IF SUCH COMMERCIAL EQUIVALENTS ARE NOT SO LISTED. EXTENDED THE BID OPENING TO JUNE 8 AND SUBSTITUTED THE FOLLOWING FOR THE PROVISION QUOTED ABOVE: "AWARD WILL BE MADE ONLY TO A BIDDER WHO SUBMITS WITH HIS BID ACCEPTABLE DESIGNS OF THE PRODUCTS HE PROPOSES TO FURNISH UNDER ITEMS 1 AND 2 RESPECTIVELY. OR IS CURRENTLY PRODUCING. IF THE BIDDER HAS SUCH TYPE ACCEPTANCE FOR AN EQUIVALENT OF ITEM 1 OR 2 OR BOTH HE SHOULD FURNISH WITH HIS BID THE TYPE OR MODEL NUMBER OF EACH SUCH EQUIVALENT WHICH IS LISTED IN THE FCC "RADIO EQUIPMENT LIST.

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B-149265, OCT. 19, 1962

TO COMMUNICATIONS COMPANY, INCORPORATED:

BY LETTER OF JUNE 25, 1962, ADDRESSED TO CONGRESSMAN EARL WILSON, A COPY OF WHICH WAS FURNISHED TO US, YOU PROTESTED THE PROPOSED REJECTION OF YOUR BID SUBMITTED PURSUANT TO INVITATION FOR BIDS NO. 600-979-62-S, ISSUED APRIL 11, 1962, BY THE U.S. NAVY PURCHASING OFFICE FOR THE PROCUREMENT OF VARYING QUANTITIES OF COMMUNICATIONS EQUIPMENT WITH RELATED SPARE PARTS AND DATA.

AS ORIGINALLY ISSUED THE INVITATION PROVIDED THAT BIDS WOULD BE OPENED ON MAY 11, 1962, AND CONTAINED THE FOLLOWING PROVISION:

"NOTE: AWARD WILL BE MADE ONLY TO A BIDDER WHOSE COMMERCIAL EQUIVALENTS OF THE EQUIPMENTS DESCRIBED IN THIS INVITATION HAVE, PRIOR TO THE OPENING DATE OF BIDS, BEEN TYPE ACCEPTED BY THE FEDERAL COMMUNICATIONS COMMISSION FOR LICENSING UNDER RULES PART 10 OR 16 IN THE RADIO SERVICES OTHER THAN BROADCAST. BIDDERS SHALL FURNISH WITH THEIR BIDS THE TYPE NUMBERS OF SUCH COMMERCIAL EQUIVALENTS WHICH ARE LISTED IN THE FCC "RADIO EQUIPMENT LIST, PART C, EQUIPMENT ACCEPTABLE FOR LICENSING IN THE RADIO SERVICES OTHER THAN BROADCAST," DATED 9 FEBRUARY 1962. IF SUCH COMMERCIAL EQUIVALENTS ARE NOT SO LISTED, BIDDERS SHALL FURNISH WITH THEIR BIDS EVIDENCE OF SUCH TYPE ACCEPTANCE BY THE FEDERAL COMMUNICATIONS COMMISSION.'

HOWEVER, BID AMENDMENT NO. 1, ISSUED MAY 8, 1962, EXTENDED THE BID OPENING TO JUNE 8 AND SUBSTITUTED THE FOLLOWING FOR THE PROVISION QUOTED ABOVE:

"AWARD WILL BE MADE ONLY TO A BIDDER WHO SUBMITS WITH HIS BID ACCEPTABLE DESIGNS OF THE PRODUCTS HE PROPOSES TO FURNISH UNDER ITEMS 1 AND 2 RESPECTIVELY.

"EACH BIDDER MUST SUBMIT WITH HIS BID ACCEPTABLE DESIGNS OF THE PRODUCTS HE PROPOSES TO FURNISH UNDER ITEMS 1 AND 2 RESPECTIVELY. THE DESIGNS REQUIRED TO BE SUBMITTED AS AFORESAID SHALL CONSIST OF DATA, SUCH AS AN INSTRUCTION BOOK, A PARTS LIST, BILL OF MATERIALS, DISSERTATION, TABLE OF WEIGHTS AND, IF AVAILABLE, PHOTOGRAPHS AND TEST DATA, AS THE BIDDER DEEMS APPROPRIATE. IN THE EVENT A BIDDER HAS PRODUCED, OR IS CURRENTLY PRODUCING, UNDER A BUREAU OF SHIPS CONTRACT EQUIPMENTS COMPARABLE TO ITEM 1 OR ITEM 2 OR BOTH, THE DESIGN INFORMATION RESPECTIVELY REQUIRED TO BE FURNISHED WITH RESPECT TO SUCH ITEM/S) MAY BE SUBMITTED IN THE FORM OF REFERENCES CLEARLY IDENTIFYING PLANS, DRAWINGS, INSTRUCTION BOOKS OR OTHER INFORMATION PREVIOUSLY SUBMITTED IN ACCORDANCE WITH THE REQUIREMENTS OF THE AFOREMENTIONED CONTRACT/S) TOGETHER WITH APPROPRIATE REVISIONS, MODIFICATIONS OR ADDITIONS TO SUCH PREVIOUSLY SUBMITTED INFORMATION.

"TO BE ACCEPTABLE THE DESIGNS REQUIRED AS AFORESAID MUST SHOW MECHANICAL AND ELECTRICAL CHARACTERISTICS, INCLUDING PARTS AND MATERIALS WITH SUFFICIENT CLARITY, COMPLETENESS AND DETAIL AND MUST BE SO PREPARED AS TO (I) ENABLE A THOROUGH EVALUATION OF THE CHARACTERISTICS, PERFORMANCE AND QUALITY OF THE PROPOSED PRODUCT TO BE MADE, (II) PROVIDE ASSURANCE, AS A MATTER OF ENGINEERING JUDGMENT, THAT A PRODUCT BUILT IN ACCORDANCE WITH THE SUBMITTED DESIGN CAN REASONABLY BE EXPECTED TO MEET THE REQUIREMENTS OF THE APPLICABLE SPECIFICATIONS, AS SET FORTH AND MODIFIED IN THIS INVITATION FOR BIDS, AND (III) PERMIT A SOUND ENGINEERING DETERMINATION TO BE MADE THAT THE PRODUCTS PROPOSED TO BE FURNISHED UNDER ITEMS 1 AND 2 RESPECTIVELY FULLY MEET THE TECHNICAL REQUIREMENTS FOR TYPE ACCEPTANCE BY THE FEDERAL COMMUNICATIONS COMMISSION FOR LICENSING UNDER RULES PART 10 OR 16 IN THE RADIO SERVICES OTHER THAN BROADCAST. IF THE BIDDER HAS SUCH TYPE ACCEPTANCE FOR AN EQUIVALENT OF ITEM 1 OR 2 OR BOTH HE SHOULD FURNISH WITH HIS BID THE TYPE OR MODEL NUMBER OF EACH SUCH EQUIVALENT WHICH IS LISTED IN THE FCC "RADIO EQUIPMENT LIST, PART C, EQUIPMENT ACCEPTABLE FOR LICENSING IN THE RADIO SERVICE OTHER THAN BROADCAST" DATED 9 FEBRUARY 1962 OR, IF NOT SO LISTED, OTHER EVIDENCE OF SUCH TYPE ACCEPTANCE BY THE FEDERAL COMMUNICATIONS COMMISSION. FAILURE TO SUBMIT DESIGNS REQUIRED AS ABOVE PROVIDED OR THE UNACCEPTABILITY OF ANY DESIGN SUBMITTED SHALL RESULT IN REJECTION OF THE RELATED BID AS NON-RESPONSIVE.

ITEMS 1 AND 2 SHALL BE IN ACCORDANCE WITH THE CONTRACTOR'S ACCEPTABLE DESIGNS FOR SAID ITEMS RESPECTIVELY, EXCEPT THAT IN THE EVENT OF ANY CONFLICT OR INCONSISTENCY BETWEEN SUCH DESIGN AND THE REQUIREMENTS OF THE APPLICABLE SPECIFICATIONS, AS SET FORTH AND MODIFIED IN THIS INVITATION FOR BIDS, THE LATTER SHALL GOVERN, AND THE AWARD SHALL IDENTIFY THE ACCEPTABLE DESIGNS.'

BIDS WERE OPENED ON JUNE 8 AND IT WAS DETERMINED BY THE CONTRACTING AGENCY TO MAKE AWARD ON A QUANTITY OF 1,239 MOBILE FM TRANSMITTER RECEIVERS (ITEM 1), 377 FIXED STATION TRANSMITTERS AND RECEIVERS (ITEM 2), AND 119 REMOTE CONTROL CONSOLES (ITEM 3). BIDS RECEIVED FOR THE DESIGNATED QUANTITIES WERE AS FOLLOWS:

CHART

BIDDER PRICE DISCOUNT COMCO (BID NO. 2) $673,704.40 1/2 PERCENT - 20 DAYS DARE 714,296.30 NONE GENERAL ELECTRIC 752,655.91 NONE COMCO (BID NO. 1) 776,541.40

1/2 PERCENT - 20 DAYS MOTOROLA 779,089.80 NONE

THE TWO LOW BIDS WERE REJECTED AS NONRESPONSIVE AND AWARD WAS MADE TO THE THIRD LOW BIDDER, GENERAL ELECTRIC, ON JULY 30, 1962. YOUR BID, NO. 2, WHICH WAS LOW, WAS REJECTED BECAUSE IT WAS ACCOMPANIED BY, AND INCLUDED AS A PART THEREOF, YOUR LETTER, REFERENCE NO. 3047, DATED JUNE 4, 1962, IN WHICH EXCEPTION WAS TAKEN TO THE APPLICABLE SPECIFICATIONS AS FOLLOWS:

"1. REF. A) PAR. 3.7.3 (SIC; 3.7.2.3) AUDIO SQUELCH SENSITIVITY. IT IS REQUESTED THAT THE SQUELCH SENSITIVITY REQUIREMENT OF 0.25 MICROVOLTS BE MODIFIED TO READ AS FOLLOWS; " ... 0.6 MICROVOLTS AS MEASURED BY THE "OPEN CIRCUIT" METHOD OR 0.3 MICROVOLTS BY THE "TERMINATED" THOD.'

"2. REF. A) PAR. 3.7.2.6 SPURIOUS RESPONSIVE ATTENUATION IT IS REQUESTED THAT THIS BE CHANGED FROM "100 DB OR BETTER" TO READ "85 DB OR BETTER" IN ACCORDANCE WITH KIA SPECIFICATIONS RS-203, PAR. 8.2.

"3. REF. A), PAR. 2.7.2.7 (SIC; 3.7.2.7) INTERMODULATION SPURIOUS ATTENTUATION IT IS REQUESTED THAT THIS BE CHANGED IN ACCORDANCE WITH EIA SPECIFICATION RS-204, PAR. 9.3 WHICH IS AS FOLLOWS:

CHART "9.3 MINIMUM STANDARD

DESIRED OPEN CIRCUIT MINIMUM

SIGNAL REFERENCE LEVEL AT RECEIVER INPUT REQUIREMENT 1. USABLE SENSITIVITY AS MEASURED IN 3.2 50 DB 2. 20 MICROVOLTS 40 DB 3. 200 MICROVOLTS

30 DB"

"OTHER THAN THE ABOVE OUR LATEST ALL-TRANSISTOR COMMERCIAL RECEIVER WHICH WE HAVE UNDER DEVELOPMENT WILL MEET THE REMAINDER OF THE SPECIFICATION REF. A), AS DOES THE TRANSMITTER.'

AFTER BIDS WERE OPENED YOUR FIRM REQUESTED DELETION OF THE THREE EXCEPTIONS BY TELEGRAM OF JUNE 12, 1962. HOWEVER, THAT TELEGRAM WAS PROPERLY NOT CONSIDERED IN DETERMINING THE RESPONSIVENESS OF YOUR BID SINCE IT IS A BASIC PRECEPT OF THE COMPETITIVE BID SYSTEM THAT BIDS MAY NOT BE CHANGED AFTER OPENING TO CONFORM TO THE SPECIFICATIONS. SEE 17 COMP. GEN. 554, 558; 21 COMP. GEN. 1132, 1136.

IN YOUR LETTER OF JUNE 25 YOU CHARACTERIZED THE THREE EXCEPTIONS AS "HIGHLY TECHNICAL, WITH MINOR DEVIATIONS" IN NO WAY AFFECTING THE NAVY'S INTENDED USE OF THE EQUIPMENT. IN ADDITION, YOU STATE IN THE LETTER:

"WE WOULD POINT OUT THAT UNDER THE IMMEDIATE PRECEDING CONTRACT FOR THE SAME IDENTICAL EQUIPMENT, NOBSR 87064, WE HAVE BEEN GIVEN BY THE BUREAU OF SHIPS, CODE 675, AN UNOFFICIAL CLARIFICATION OF THESE THREE MINOR DEVIATIONS AS PROPOSED IN OUR LETTER, REFERENCE NO. 3047 OF 4 JUNE 1962 ENCLOSED.

"INASMUCH AS CONTRACT NOBSR 87064 AND IFB 600-979-62S ARE FOR THE SAME EQUIPMENT AND GOVERNED BY THE SAME SPECIFICATION, WE ARE UNQUESTIONABLY FULFILLING THE NAVY'S REQUIREMENTS. IT IS THEREFORE OBVIOUS THE NAVY'S POSITION IS INCONSISTENT.'

FINALLY YOU CONTEND THAT THE AMENDMENT TO THE INVITATION IS "A DEFINITE VIOLATION OF CONGRESS" INTENT OF PUBLIC COMPETITIVE BIDDING AS PROMULGATED BY ASPR.'

IT IS THE POSITION OF THE DEPARTMENT OF THE NAVY, AS STATED IN A REPORT TRANSMITTED BY LETTER OF SEPTEMBER 26, SIGNED BY THE ASSISTANT SECRETARY (INSTALLATIONS AND LOGISTICS), THAT THE EXCEPTIONS TAKEN TO THE SPECIFICATIONS APPLICABLE TO THE PROCUREMENT ARE SUBSTANTIAL. IT IS NOTED IN THAT CONNECTION THAT THE PRICE DIFFERENCE BETWEEN YOUR BID NO. 2 AND YOUR BID NO. 1, WHICH PRESUMABLY REPRESENTS THE BEST BID YOU WERE ABLE TO SUBMIT ON A FULLY RESPONSIVE BASIS, EXCEEDS $100,000. FURTHER, IT IS STATED IN THE REPORT:

"THE SECOND AND THIRD OF COMCO'S LISTED EXCEPTIONS DEALT WITH SPURIOUS ATTENUATION REQUIREMENTS OF SHIPS-R-4098, SPECIFICALLY PARAGRAPH 3.7.2.6 FOR SPURIOUS RESPONSE ATTENUATION AND 3.7.2.7 FOR INTERMODULATION SPURIOUS ATTENUATION. COMCO'S SECOND BID WAS PREDICATED UPON CHANGING THE NAVY'S SPECIFIED REQUIREMENTS TO THE MUCH LOWER AND LESS STRINGENT REQUIREMENTS SET FORTH IN ELECTRONIC INDUSTRIES ASSOCIATION (EIA) SPECIFICATIONS. WERE THIS TO BE DONE, IT WOULD RESULT IN EQUIPMENTS HAVING GREATER DISTORTION AND INTERFERENCE WITH A RESULTANT LESSER QUALITY AND UTILITY. THE EIA SPECIFICATIONS IN THESE RESPECTS REPRESENT MINIMUM INDUSTRY STANDARDS. THERE MAY BE SITUATIONS WHERE SUCH MINIMUM STANDARDS ARE ACCEPTABLE FOR THE PURPOSE OF THE USER. THE NAVY'S EQUIPMENT MUST BE CAPABLE OF OPERATING IN SITUATIONS WHERE ELECTRO-MAGNETIC CONDITIONS ARE SUCH THAT THE EIA MINIMUM INDUSTRY STANDARDS OF ATTENUATION ARE NOT ADEQUATE. MEET ESSENTIAL NAVY NEEDS, REQUIREMENTS FOR ATTENUATION STRICTER THAN EIA STANDARDS ARE NECESSARILY SPECIFIED IN ORDER TO HAVE EQUIPMENT WHICH WILL BE CAPABLE OF OPERATING SATISFACTORILY UNDER SUCH CONDITIONS. IN MANY OTHER RESPECTS EIA STANDARDS ARE ACCEPTABLE AND ARE ADOPTED BY THE NAVY'S SPECIFICATIONS. THE SUBSTANTIVE AND MATERIAL NATURE OF THE TWO EXCEPTIONS TO THE ATTENUATION SPECIFICATIONS MAKE IT UNNECESSARY TO CONSIDER COMCO'S OTHER LISTED EXCEPTION.'

THE NAVY REPORT DENIES YOUR CONTENTION THAT UNOFFICIAL CLARIFICATION OF THE THREE DEVIATIONS AS PROPOSED IN YOUR QUOTED LETTER HAVE BEEN APPROVED WITH RESPECT TO EXISTING CONTRACT NOBSR-87064. IN ADDITION, IT IS REPORTED THAT YOUR FIRM IS NOT MEETING THE NAVY'S REQUIREMENTS UNDER THE CITED CONTRACT IN THAT THE PREPRODUCTION MODEL SUBMITTED IN CONNECTION THEREWITH FOR THE MOBILE EQUIPMENT DOES NOT MEET THE SPECIFICATIONS. SPECIFICALLY, THE NAVY REPORT STATES:

"IN AN EFFORT TO HELP SOLVE COMCO'S DIFFICULTIES, THE BUREAU OF SHIPS DID PRELIMINARILY ACCEPT COMCO'S PREPRODUCTION MODEL FOR TESTING AND EVALUATION AT THE NAVY ELECTRONICS LABORATORY EVEN THOUGH COMCO'S IN-PLANT TESTING OF THIS MODEL INDICATED DEFICIENCIES. COMCO WAS ORALLY ADVISED THAT, DEPENDING ON THE OUTCOME OF NAVY TESTING AND EVALUATION OF THE PREPRODUCTION MODEL CONSIDERED AS A WHOLE, THE BUREAU OF SHIPS WOULD CONSIDER SOME RELAXATION OF THE ATTENUATION REQUIREMENTS, IN VIEW OF OBTAINING A FULLY TRANSISTORIZED RECEIVER WHICH HAS MANY ADVANTAGES, PARTICULARLY A MUCH LOWER POWER DRAIN, OVER A RECEIVER UTILIZING TUBES IN WHOLE OR IN PART. TESTS TO DATE SHOW COMCO'S PREPRODUCTION MODEL TO BE SO DEFICIENT THAT NOT EVEN A CONDITIONAL APPROVAL CAN BE GIVEN--- AMONG OTHER MAJOR DEFECTS IT "MOTORBOATS" WHEN USING A 24 VOLT POWER SUPPLY. (AS INDICATED ABOVE, IT IS REQUIRED TO FUNCTION PROPERLY FROM BOTH 12 AND 24 VOLT POWER SOURCES.) COMCO IS NOW ENGAGED ON ITS THIRD CORRECTION OF THIS MODEL SINCE ITS SUBMISSION. THE BUREAU OF SHIPS DID NOT ADVISE UNDER COMCO'S CURRENT CONTRACT. SOME RELAXATION OF SPECIFIED ATTENUATION MAY BE JUSTIFIED FOR THAT CONTRACT IN CONSIDERATION OF THE ADVANTAGES OF A FULLY TRANSISTORIZED RECEIVER, BUT, FOR REASONS MENTIONED ABOVE, THE NAVY CANNOT ADOPT EIA MINIMUM STANDARDS OF ATTENUATION FOR ITS SPECIFICATION REQUIREMENTS.'

IT HAS LONG BEEN ESTABLISHED THAT IT IS PRIMARILY WITHIN THE JURISDICTION OF THE CONTRACTING AGENCY TO FIX THE SPECIFICATIONS MEETING THE GOVERNMENT'S REQUIREMENTS AND TO DETERMINE FACTUALLY WHETHER THOSE SPECIFICATIONS ARE MET BY THE ARTICLES OFFERED. 17 COMP. GEN. 554; 557. IN VIEW THEREOF AND OF THE PRESENTATION MADE BY THE NAVY WITH RESPECT TO THE MATERIALITY OF THE EXCEPTIONS, WE FIND NO BASIS TO QUESTION THE LEGALITY OF THE NAVY'S ACTION IN REJECTING YOUR BID NO. 2. CF. 40 COMP. GEN. 132.

AS TO YOUR CHARGE THAT THE AMENDMENT TO THE INVITATION CONSTITUTES A DEFINITE VIOLATION OF COMPETITIVE BIDDING PROCEDURES, WE ASSUME YOU HAVE REFERENCE TO THE REQUIREMENT THAT A BID TO BE REGARDED AS RESPONSIVE MUST BE ACCOMPANIED BY DESIGNS AND OTHER INFORMATION. IT IS NOW WELL ESTABLISHED THAT THE CONTRACTING AGENCY HAS A RIGHT TO REQUIRE THE SUBMISSION OF SUCH DATA WITH EACH BID AND TO MAKE THE FAILURE TO CONFORM A VALID BASIS FOR REJECTING A BID AS NONRESPONSIVE. 40 COMP. GEN. 132, 135; 37 COMP. GEN. 763; 36 COMP. GEN. 415; ID. 376. ACCORDINGLY, WE CONCLUDE THAT THERE HAS BEEN PRESENTED NO BASIS TO QUESTION THE LEGALITY OF THE AWARD MADE UNDER THE INVITATION.

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