B-112614, JAN 23, 1953

B-112614, JAN 23, 1953

PRECIS-UNAVAILABLE

G. RICHARD ISETT, AMERICAN EXPANSION BOLT & MANUFACTURING COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 29, 1952, AND SUBSEQUENT CORRESPONDENCE, PROTESTING AWARD OF CONTRACTS ON INVITATIONS (IFB) 34-601-53-152 AND (IFB) 34-601-53-153, TO ANY BIDDER OTHER THAN YOUR COMPANY.

AS YOU WERE ADVISED IN OFFICE LETTER OF OCTOBER 31, 1952, THE DEPARTMENT OF THE AIR FORCE WAS REQUESTED TO INVESTIGATE THE MATTER OF YOUR PROTEST AND FURNISH A REPORT TO THIS OFFICE. ADVICE IN THE MATTER HAS NOW BEEN RECEIVED FROM THE DEPUTY FOR MATERIAL PROGRAMS, DEPARTMENT OF THE AIR FORCE, AS FOLLOWS:

"WE BELIEVE THAT THE USE OF THE TECHNICAL SPECIFICATONS INVOLVED IN THESE PROCUREMENTS IS FULLY JUSTIFIED. THEY WERE DEVELOPED BY WRIGHT AIR DEVELOPMENT CENTER SPECIFICALLY FOR THE PURPOSE OF IDENTIFYING MAINTENANCE PARTS AND OTHER ITEMS WHICH UPON IMMERSION IN SOLVENTS MUST WITHSTAND THE CORROSIVE EFFECTS OF THE SOLVENTS AND STILL NOT LOSE THEIR IDENTITY BY DISSOLVING IN THE LIQUID. THE ITEM IS USED ALSO TO IDENTIFY MATERIAL IN OUTSIDE STORAGE AND ITEMS BEING SHIPPED OVERSEAS. THE CONVENTIONAL ADDRESSOGRAPH PLATE UTILIZED BY THE GENERAL SERVICES ADMINISTRATION AND BY INDUSTRY DOES NOT SERVE THE PURPOSE. COST DATA ACCUMULATED BY DEPOTS INDICATES THAT USE OF THE IDENTIFICATION PLATES MANUFACTURED IN ACCORDANCE WITH THE SPECIFICATIONS MENTIONED ABOVE RESULTS IN CONSIDERABLE SAVINGS TO THE AIR FORCE.

"AS A RESULT OF OUR INVESTIGATION, HOWEVER, WE HAVE CONCLUDED THAT THE TERMS OF THE INVITATIONS WERE UNDULY RESTRICTIVE BECAUSE REPRESENTATIVE SAMPLES OF EACH ITEM PROCURED WERE REQUIRED TO BE FURNISHED WITH THE BID, AND ONLY ONE FIRM, RASHEW BUSINESS MACHINES COMPANY, IS PRESENTLY IN A POSITION TO FURNISH SUCH A SAMPLE. WHILE THIS ITEM CAN BE FABRICATED BY PRACTICALLY ALL THE FIRMS MANUFACTURING THE CONVENTIONAL TYPE OF ADDRESSOGRAPH PLATE, FURTHER INVESTIGATION DISCLOSED THAT CONSIDERABLE TIME WOULD BE REQUIRED TO GEAR UP AND MANUFACTURE AN ITEM WHICH WOULD MEET THE SPECIFICATIONS. IT IS ESTIMATED THAT FROM ONE TO THREE MONTHS WOULD THUS BE REQUIRED BEFORE A CONTRACTOR COULD FURNISH A SAMPLE. THIS WOULD, OF COURSE, ENTAIL CONSIDERABLE EXPENSE ON THE PART OF THE CONTRACTOR WITH NO ASSURANCE THAT HE WOULD BE GIVEN A CONTRACT. FURTHERMORE, THE DELIVERY SCHEDULE INCORPORATED IN THE REFERENCED IFB, WHICH PROVIDED FOR 25% OF THE TOTAL PROCUREMENT TO BE DELIVERED WITHIN 20 DAYS, 25% WITHIN 40 DAYS, AND THE BALANCE WITHIN 60 DAYS, HAS BEEN FOUND TO BE UNREALISTIC IN THE LIGHT OF SUBSEQUENT DEVELOPMENTS, AND IN VIEW OF THE FACTS ENUMERATED ABOVE.

"IN VIEW OF THE FOREGOING AIR MATERIEL COMMAND HAS RECOMMENDED TO THE CONTRACTING OFFICE, AND I CONCUR, THAT NO PROCUREMENTS WILL BE MADE UNDER SUBJECT IFB'S. INSTEAD, A NEW IFB COVERING ESTIMATED REQUIREMENTS FOR STOCK PURPOSES WILL BE ISSUED, INCORPORATING THE TECHNICAL SPECIFICATIONS PREVIOUSLY REFERRED TO. IT WILL PROVIDE FOR FIRST ARTICLE APPROVAL WITHIN 90 DAYS FROM THE DATE OF EXECUTION OF THE CONTRACT, THE BALANCE OF THE REQUIREMENTS TO BE DELIVERED WITHIN 150 DAYS AFTER EXECUTION OF THE CONTRACT.

"I UNDERSTAND THAT OUR ACTION IN CANCELLING THESE IFB'S IS NOT SATISFACTORY TO THE COMPLAINING BIDDER, WHO BELIEVES HIS COMPANY SHOULD RECEIVE THE AWARD UNDER THEM BECAUSE ITS BID WAS LOW. I FEEL YOU WILL AGREE THAT AWARD TO THE AMERICAN EXPANSION BELT & MANUFACTURING COMPANY, WHOSE BID, THOUGH LOW, WAS UNRESPONSIVE TO THE ADMITTEDLY ONEROUS REQUIREMENTS OF THE INVITATION BOTH IN RESPECT OF THE SAMPLE AND OF THE DELIVERY DATE, WOULD GIVE PROPER GROUND FOR PROTEST TO THE RASHEW COMPANY, WHOSE BID WAS ENTIRELY RESPONSIVE TO THE INVITATION. UNDER THESE CIRCUMSTANCES, WE BELIEVE THAT CANCELLATION OF THE INVITATIONS AND READVERTISING UNDER THE CONDITIONS STATED ABOVE REPRESENTS THE ONLY PROPER SOLUTION.

"I HAVE BEEN ADVISED, HOWEVER, THAT THE PRESENT STOCK OF THE REQUIRED PLATES IS SO LOW AS ACTUALLY TO IMPEDE PRODUCTION AT OKLAHOMA CITY AIR FORCE DEPOT. FOR THAT REASON, AN EMERGENCY PROCUREMENT WILL BE AUTHORIZED ON A NEGOTIATED BASIS TO MEET IMMEDIATE INTERIM REQUIREMENTS. THE AMERICAN EXPANSION BOLT & MANUFACTURING COMPANY WILL BE GIVEN AN OPPORTUNITY TO PARTICIPATE IN THIS INTERIM PROCUREMENT."

WITH RESPECT TO CANCELLATION OF THE CONTROVERSIAL INVITATIONS AND READVERTISING, YOU ARE ADVISED THAT, IN INSTANCES WHERE ORIGINAL INVITATIONS HAVE FAILED TO AFFORD FREE AND UNRESTRICTED COMPETITION AS REQUIRED BY LAW, DECISIONS OF THIS OFFICE CONSISTENTLY HAVE APPROVED SUCH A PROCEDURE. IN 17 COMP. GEN. 409, IT WAS HELD, QUOTING FROM THE SYNOPSIS, THAT -

"THE PUBLIC WELFARE, AS WELL AS THE PROTECTION OF PUBLIC AGENCIES AND OFFICERS AGAINST TEMPTATION AND OPPORTUNITY FOR FRAUD, UNFAIRNESS, AND FAVORITISM, REQUIRES THAT THE PURCHASE OF SUPPLIES, ETC., BE ON THE BASIS OF DEFINITE SPECIFICATIONS, AND, THAT AWARDS BE MADE ON THE BASIS OF THE ADVERTISED SPECIFICATIONS AND NOT TO A BIDDER FAILING TO MEET THE SPECIFICATIONS MERELY BECAUSE HIS BID IS LOW AND IT IS ADMINISTRATIVELY THOUGHT THE ARTICLE OFFERED WOULD SUFFICE.

"WHERE THE ADVERTISED SPECIFICATIONS SET OUT A DEFINITE REQUIREMENT WHICH IT IS VARIOUSLY CONTENDED IS NOT MET BY THE ARTICLE OFFERED BY RESPECTIVE BIDDERS, AND IT IS DETERMINED THAT WHILE THE ARTICLE OFFERED BY THE LOW BIDDER DOES NOT MEET THE SPECIFICATIONS, IT MAY SUFFICE TO MEET ACTUAL NEED, IT IS FOR ADMINISTRATIVE CONSIDERATION WHETHER THE ARTICLE OF ANOTHER BIDDER DOES MEET THE SPECIFICATIONS AND, IF SO, WHETHER IT SHOULD BE ACCEPTED, OR WHETHER THERE SHOULD BE REJECTION OF ALL BIDS AND READVERTISEMENT OF THE SPECIFICATIONS SO REVISED AS TO MORE CLEARLY STATE THE ACTUAL NEED."

MOREOVER, THE STATUTE REGULATING PROCUREMENTS BY THE ARMED SERVICES PROVIDES THAT "WHENEVER ADVERTISING IS REQUIRED *** AWARD SHALL BE MADE *** TO THAT RESPONSIBLE BIDDER WHOSE BID, CONFORMING TO THE INVITATION FOR BIDS, WILL BE MOST ADVANTAGEOUS *** PROVIDED, THAT ALL BIDS MAY BE REJECTED WHEN THE AGENCY HEAD DETERMINES THAT IT IS IN THE PUBLIC INTEREST TO DO SO." 41 U.S.C. 151, 152.

IT THUS APPEARING THAT YOUR PROTEST HAS BEEN APPROPRIATELY CONSIDERED BY THE DEPARTMENT OF THE AIR FORCE IN ACCORDANCE WITH THE APPLICABLE LEGAL REQUIREMENTS AND THAT YOUR FIRM WILL BE ACCORDED EVERY FAIR OPPORTUNITY TO BID ON AND TO PARTICIPATE IN FURNISHING CURRENT AND FUTURE NEEDS OF THE DEPARTMENT, THERE IS NO FURTHER ACTION THIS OFFICE PROPERLY MAY TAKE IN THE MATTER.