B-146294, AUG. 25, 1961

B-146294, AUG. 25, 1961

TO PRODUCT AND INDUSTRIAL ENGINEERING CORPORATION:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 30, 1961, PROTESTING CONCERNING THE AWARD MADE TO LOCKHEED AIRCRAFT SERVICES--- NEW YORK, INC., BY THE FEDERAL AVIATION AGENCY, UNDER REQUEST FOR QUOTATIONS NO. PRD-AG-61 -1.

THE NATIONAL AVIATION FACILITIES EXPERIMENTAL CENTER, ATLANTIC CITY, NEW JERSEY, REQUESTED QUOTATIONS FOR SERVICES FOR THE MAINTENANCE, FUELING, INSPECTION, MODIFICATION, INSTALLATION, SERVICING AND REPAIR OF AIRCRAFT AND AIRCRAFT COMPONENTS DURING THE PERIOD JULY 1, 1961, THROUGH JUNE 30, 1962, UNDER A COST-PLUS-A-FIXED-FEE CONTRACT. OFFERORS WERE REQUIRED TO QUOTE FIXED AMOUNTS FOR PHASE-IN COSTS AND FOR FEE FOR PERFORMING THE SERVICES. OFFERORS WERE ALSO REQUIRED TO SET FORTH THE TOTAL ESTIMATED COST OF PERFORMING THE REQUIRED SERVICES ON THE BASIS OF A PROPOSED PLAN OF OPERATIONS. WITH RESPECT TO AWARD THE INVITATION PROVIDED:

"BASIS FOR AWARD: AWARD WILL BE BASED ON THE CONTRACTING OFFICER'S DETERMINATION WITH RESPECT TO THE PROPOSAL THAT PROMISES THE GREATEST VALUE TO THE GOVERNMENT IN TERMS OF POSSIBLE PERFORMANCE, AFTER DUE CONSIDERATION OF VARIOUS FACTORS, SUCH AS:

A. RESPONSIVENESS OF OFFEROR'S PROPOSAL TO THE INVITATION.

B. PRIOR EXPERIENCE AND OTHER QUALIFICATIONS OF THE OFFEROR FOR THIS TYPE OF SERVICE.

C. EFFECTIVENESS OF THE OFFEROR'S PROPOSED METHODS, ORGANIZATION, AND OPERATION.

D. THE AMOUNT OF THE OFFEROR'S FIXED FEE.

E. VALIDITY OF OFFEROR'S COST ESTIMATE IN VIEW OF HIS PROPOSED PLAN OF OPERATION, AND IN COMPARISON WITH AN INDEPENDENT GOVERNMENT ESTIMATE.

F. VALIDITY AND AMOUNT OF OFFEROR'S PROPOSED PHASE-IN COSTS, AND HIS ABILITY TO ASSUME FULL RESPONSIBILITY FOR THE OPERATION ON SCHEDULE.'

TEN QUOTATIONS WERE RECEIVED IN RESPONSE TO THE REQUEST. YOU QUOTED A PRICE OF $47,597.25 FOR FIXED FEE AND $9,589.63 AS PHASE-IN COSTS, OR A TOTAL FIXED COST OF $57,186.88. YOU ESTIMATED THE COST OF THE REIMBURSABLE SERVICES AS $468,274.88. LOCKHEED AIRCRAFT SERVICES--- NEW YORK, INC., QUOTED $71,242 FOR FIXED-FEE AND NOTHING FOR PHASE-IN COSTS. THE TOTAL OF THE REIMBURSABLE EXPENSES WAS ESTIMATED AT $921,865.92, BASED ON OPERATIONS REQUIRING 142 EMPLOYEES.

A SURVEY TEAM COMPOSED OF NAFEC PERSONNEL WAS FORMED TO CONDUCT A FACILITY SURVEY OF YOUR CORPORATION AND TO DETERMINE ITS FITNESS TO PERFORM THE REQUIRED SERVICES. THE PRIMARY CONSIDERATION IN AWARD OF THE CONTRACT WAS CONSIDERED TO BE THE TECHNICAL COMPETENCE AND EXPERIENCE OF THE CONTRACTOR WITH RESPECT TO THE PARTICULAR TYPE OF OPERATION, SINCE THE SAFETY OF PERSONS FLYING THE AIRCRAFT, AS WELL AS OF THE AIRCRAFT ITSELF, IS INVOLVED.

BASED ON THE RESULTS OF THE SURVEY OF YOUR CORPORATION IT WAS DETERMINED NOT TO MAKE AN AWARD TO YOU FOR THE FOLLOWING REASONS, (1) LACK OF NECESSARY EXPERIENCE IN MILITARY AND CIVIL AIRCRAFT FLEET MAINTENANCE, (2) LACK OF SUFFICIENT SKILLED PERSONNEL TO PERFORM THE WORK REQUIRED, AND (3) FAILURE TO UNDERSTAND THE FULL EXTENT OF THE CONTRACT REQUIREMENTS AS EVIDENCED FROM THE COST ESTIMATES SUBMITTED WITH YOUR PROPOSAL. IT WAS FURTHER DETERMINED THAT, ALTHOUGH YOU QUOTED THE LOWEST FIXED COSTS, SINCE THE PROPOSED CONTRACT WAS A COST REIMBURSEMENT TYPE AN AWARD TO YOU COULD EASILY HAVE RESULTED IN A MUCH HIGHER COST TO THE GOVERNMENT DUE TO THE FACTORS MENTIONED ABOVE, AND THAT IN ADDITION SUCH AN AWARD COULD HAVE SERIOUSLY IMPAIRED THE OPERATION OF THE NAFEC AIRCRAFT FLEET, RESULTING IN COSTS WHICH ARE DIFFICULT TO ASSESS.

IN YOUR LETTER OF FEBRUARY 27, 1961, TO NAFEC, IT WAS CONTENDED THAT SUCH FACTORS AS PRIOR EXPERIENCE IN AN INTEGRATED OPERATION AND ORGANIZATIONAL DEPTH WERE NOT PERTINENT TO THE OPERATIONS TO BE PERFORMED AND WERE NOT A PROPER OR SUFFICIENT BASIS FOR DETERMINING YOUR QUALIFICATIONS AS TO RESPONSIBILITY. WE CANNOT AGREE. IN OUR OPINION THE REQUEST FOR QUOTATIONS PROPERLY PROVIDED THAT THE OFFERORS' PRIOR EXPERIENCE WOULD BE TAKEN INTO CONSIDERATION AND THAT AWARD WOULD BE BASED ON A DETERMINATION WITH RESPECT TO THE PROPOSAL THAT PROMISED THE GREATEST VALUE TO THE GOVERNMENT AND THE BEST POSSIBLE PERFORMANCE. THE PURPOSE OF CONTRACTING FOR THE WORK WAS TO SECURE THE BENEFITS OF A COMMERCIAL CONTRACTOR'S EXPERIENCE, BACKGROUND, ORGANIZATION AND MANAGEMENT WITH RESPECT TO THE PARTICULAR TYPE OF WORK INVOLVED.

THE RECORD SHOWS THAT YOUR QUALIFICATIONS WERE THOROUGHLY CONSIDERED AND THAT IT WAS DETERMINED THAT AN AWARD TO YOU, REGARDLESS OF YOUR LOWER OFFER AS TO THE FIXED COSTS, WOULD NOT BE IN THE BEST INTEREST OF THE GOVERNMENT. WE FIND NO BASIS TO QUESTION THE ADMINISTRATIVE DETERMINATION IN THIS RESPECT AND THEREFORE YOUR PROTEST MUST BE DENIED.