B-125986, DEC. 9, 1955

B-125986, DEC. 9, 1955

TO PROJECTION OPTICS COMPANY, INC.:

FURTHER REFERENCE IS MADE TO YOUR TELEFAX RECEIVED NOVEMBER 7, 1955, PROTESTING THE AWARD OF ANY CONTRACT ON A NEGOTIATED BASIS FOR THE PROCUREMENT OF 2,300 TWO-INCH ANAMORPHIC LENSES.

YOU REQUEST THAT ANY AND ALL ACTION TO PROCURE THE LENSES BE HALTED OR RESCINDED ON THE FOLLOWING GROUNDS:

1. NO EMERGENCY PROCUREMENT IS INVOLVED,

2. THE BELL AND HOWELL COMPANY, AS THE SUCCESSFUL BIDDER, IS NEITHER THE SOLE SOURCE OF SUPPLY NOR HAS LENSES COMMERCIALLY AVAILABLE,

3. THE REMOVAL OF BIDDERS FROM THE LIST OF QUALIFIED BIDDERS WAS IMPROPER AND HIGHLY IRREGULAR,

4. THE PROCUREMENT SHOULD BE FORMALLY ADVERTISED RATHER THAN NEGOTIATED IN SECRET,

5. PARTIAL REQUIREMENT SHOULD BE SET ASIDE FOR SMALL BUSINESS,

6. RESULTANT CONSIDERABLE SAVINGS TO THE NAVY, AND

7. PROPOSED EXPENDITURE OF APPROXIMATELY $214,000 FOR THE LENSES NOT IN THE BEST INTEREST OF THE GOVERNMENT.

THE DEPARTMENT OF THE NAVY NOW HAS FORWARDED A COPY OF THE REPLY OF THE CHIEF OF NAVAL MATERIAL OF THAT DEPARTMENT TO YOUR WIRE OF NOVEMBER 6, 1955, WHICH REPLY SETS FORTH IN DETAIL THE REASONS FOR THE ADMINISTRATIVE ACTION TAKEN IN AWARDING A CONTRACT TO THE BELL AND HOWELL COMPANY FOR FURNISHING THE LENSES. THE DEPARTMENT ALSO REPORTS THAT THE CONTRACT WAS NEGOTIATED WITH THAT COMPANY BY THE BUREAU OF SHIPS PURSUANT TO THE AUTHORITY OF SECTION 2 (C) (1) OF THE ARMED SERVICES PROCUREMENT ACT OF 1947, 62 STAT. 21.

THE STATUTE REFERRED TO PROVIDES THAT ALL PURCHASES AND CONTRACTS FOR SUPPLIES AND SERVICES MAY BE NEGOTIATED, WITHOUT ADVERTISING, BY THE AGENCY HEADS SPECIFIED IN SECTION 2 (A) OF THAT ACT, INCLUDING THE SECRETARY OF THE NAVY, IF DEEMED TO BE NECESSARY IN THE PUBLIC INTEREST DURING A PERIOD OF A NATIONAL EMERGENCY DECLARED BY THE PRESIDENT OR THE CONGRESS. SUCH AN EMERGENCY WAS DECLARED BY THE THE PRESIDENT OR THE CONGRESS. SUCH AN EMERGENCY WAS DECLARED BY THE PRESIDENT ON DECEMBER 16, 1950, AND ON DECEMBER 18, 1950, THE ASSISTANT SECRETARY OF THE NAVY DETERMINED THAT IT WAS NECESSARY IN THE PUBLIC INTEREST THAT PURCHASES AND CONTRACTS FOR SUPPLIES AND SERVICES BE NEGOTIATED WITHOUT FORMAL ADVERTISING DURING THE PERIOD OF THE NATIONAL EMERGENCY.

IT IS CLEAR FROM THE RECORD THAT THE ACTION OF THE NAVY IN AWARDING THE CONTRACT TO THE BELL AND HOWELL COMPANY WAS WITHIN THE NEGOTIATION AUTHORITY OF THE SECRETARY OF THE NAVY. WHEN THAT AUTHORITY APPLIES AND IS USED THE TERMS AND CONDITIONS UPON WHICH PROPOSALS ARE REQUESTED AND THE EXTENT OF ANY ADVERTISING WHICH MAY BE EMPLOYED ARE MATTERS PRIMARILY FOR DETERMINATION BY THE DEPARTMENT OF THE NAVY. UNDER THE AUTHORITY TO NEGOTIATE, THE AGENCY HEAD, IN THIS INSTANCE THE SECRETARY OF THE NAVY, LEGALLY MAY TAKE INTO CONSIDERATION NOT ONLY PRICE BUT ALL FACTORS ESSENTIAL TO THE PROCUREMENT INVOLVED, AND, AS INDICATED, THE RULES AND PROCEDURES APPLICABLE TO PROCUREMENT BY FORMAL ADVERTISEMENT DO NOT APPLY.

THEREFORE, AND SINCE THE EVIDENCE SUBMITTED, WHICH AS STATED ABOVE INCLUDES A COPY OF THE NAVY DEPARTMENT'S LETTER OF NOVEMBER 21, 1955, TO YOU, FAILS TO SHOW THAT THE NEGOTIATION AUTHORITY WAS EXCEEDED OR ABUSED BY THE DEPARTMENT OF THE NAVY, THERE IS NO FURTHER ACTION WE PROPERLY MAY TAKE IN THE MATTER.