B-156131, APR. 8, 1965

B-156131, APR. 8, 1965

TO THE HONORABLE SECRETARY OF THE AIR FORCE:

THERE HAS RECENTLY BEEN BROUGHT TO OUR ATTENTION A MATTER WHICH WE HEREWITH SUBMIT FOR YOUR INFORMATION AND APPROPRIATE ACTION.

IN DECEMBER OF 1964 THE HOWARD IMPRINTING MACHINE COMPANY OF CHICAGO, ILLINOIS, RECEIVED A LETTER DATED DECEMBER 7, 1964, ADDRESSED TO THE HOWARD GOLD STAMPING MACHINE CO. (WHICH APPARENTLY DOES NOT EXIST) FROM THE BASE PROCUREMENT OFFICE, SEYMOUR JOHNSON AIR FORCE BASE, ADVISING THAT THE AIR FORCE WAS ANTICIPATING THE PURCHASE OF AN EMBOSSING OR MONOGRAMMING MACHINE. THE LETTER STATED THAT THE AIR FORCE PREFERRED A CONTINUOUS FOIL FEED MECHANISM AND WAS INTERESTED IN A MACHINE SIMILAR AND EQUAL TO THE "KINGSLEY MULTIPLE-LINE.' THE LETTER CONCLUDED WITH THE STATEMENT: "REQUEST YOU FORWARD PRICE CATALOG AND/OR BROCHURE DESCRIBING YOUR MACHINES.'

BY LETTER OF DECEMBER 10, 1964, FROM MR. PETER J. HAHN, PRESIDENT OF HOWARD IMPRINTING MACHINE COMPANY, THE AIR FORCE WAS FURNISHED "ALL CURRENT LITERATURE AND SAMPLES" AND WAS ALSO FURNISHED PRICE QUOTATIONS ON TWO HOWARD AND TWO KINGSLEY MACHINES. OUR RECORDS INDICATE THAT A REMINDER POST CARD ON THIS MATTER WAS SENT TO SEYMOUR JOHNSON AIR FORCE BASE BY HOWARD ON DECEMBER 19, 1964. THEREAFTER, THESE COMMUNICATIONS WERE FOLLOWED UP BY A LETTER DATED JANUARY 13, 1965, FROM HOWARD TO SEYMOUR JOHNSON WHICH REQUESTED INFORMATION ON THE STATUS OF THE PROCUREMENT FOR THE MACHINE. WE UNDERSTAND THAT NONE OF THESE COMMUNICATIONS FROM HOWARD WERE ANSWERED BY THE SEYMOUR JOHNSON AIR FORCE BASE.

PURSUANT TO A REQUEST FROM CONGRESSMAN ROMAN C. PUCINSKI, WE CONDUCTED AN INQUIRY INTO THE MATTER. IN CONNECTION THEREWITH WE OBTAINED COPIES OF TWO MESSAGES FROM THE AIR FORCE LOGISTICS COMMAND TO HEADQUARTERS, UNITED STATES AIR FORCE. THE FIRST MESSAGE (DATED MARCH 5, 1965), READS, IN PERTINENT PART, AS FOLLOWS:

"* * * ACCORDING TO THE INQUIRY BY THIS HEADQUARTERS TO SEYMOUR JOHNSON WE HAVE BEEN ADVISED THAT ON 7 DEC 64 AT THE REQUEST OF THE BASE EQUIPMENT MANAGEMENT OFFICER, AN INFORMAL SOLICITATION FOR PLANNING PURPOSES (ASPR 1 -309) WAS MADE IN RELATION TO A MACHINE SIMILAR AND EQUAL TO THE KINGSLEY MULTI-LINE FOR THEIR REQUIREMENTS--- A MACHINE WITH FOIL FEED MECHANISMS. THIS INFORMAL INQUIRY WAS MADE TO 11 FIRMS, OF WHICH HOWARD GOLD STAMP MACHINE COMPANY OF CHICAGO WAS ONE. SEYMOUR JOHNSON ADVISES THEY HAVE NO RECORD OR RECOLLECTION OF LETTERS OF 10 DEC 64, 13 AND 20 (SIC) JAN 65 BEING RECEIVED FROM THE HOWARD GOLD STAMP MACHINE COMPANY WHICH SPECIFICALLY REQUIRED A REPLY.'

THE SECOND MESSAGE REFERRED TO ABOVE IS DATED MARCH 17, 1965, AND STATES, IN PERTINENT PART:

"* * * SEYMOUR-JOHNSON AF BASE HAS ADVISED THIS HEADQUARTERS THAT NO PURCHASE HAS BEEN MADE NOR IS ANY ANTICIPATED PERTAINING TO THEIR INFORMAL SOLICITATION OF PROPOSALS ON MULTI-LINE IMPRINTING MACHINES.'

PARAGRAPH 1-309, ASPR, PROVIDES AS FOLLOWS:

"1-309 SOLICITATIONS FOR INFORMATIONAL OR PLANNING PURPOSES. IT IS THE GENERAL POLICY OF THE DEPARTMENT OF DEFENSE TO SOLICIT BIDS, PROPOSALS OR QUOTATIONS ONLY WHERE THERE IS A DEFINITE INTENTION TO AWARD A CONTRACT OR PURCHASE ORDER. HOWEVER, IN SOME CASES SOLICITATION FOR INFORMATIONAL OR PLANNING PURPOSES MAY BE JUSTIFIED. INVITATIONS FOR BIDS AND REQUESTS FOR PROPOSALS WILL BE (SIC) NOT BE USED FOR THIS PURPOSE. REQUESTS FOR QUOTATIONS MAY BE ISSUED FOR INFORMATIONAL OR PLANNING PURPOSES ONLY WITH PRIOR APPROVAL OF AN INDIVIDUAL AT A LEVEL HIGHER THAN THE CONTRACTING OFFICER. IN SUCH CASES, THE REQUEST FOR QUOTATION SHALL CLEARLY STATE ITS PURPOSE AND, IN ADDITION, THE FOLLOWING STATEMENT IN CAPITAL LETTERS SHALL BE PLACED ON THE FACE OF THE REQUEST: "THE GOVERNMENT DOES NOT INTEND TO AWARD A CONTRACT ON THE BASIS OF THIS REQUEST FOR QUOTATION, OR OTHERWISE PAY FOR THE INFORMATION SOLICITED.' THE FOREGOING DOES NOT PROHIBIT THE ALLOWANCE, IN ACCORDANCE WITH 15-205.3, OF THE COST OF PREPARING SUCH QUOTATIONS.'

A COPY OF THE LETTER DATED DECEMBER 7, 1964, FROM THE SEYMOUR JOHNSON BASE PROCUREMENT OFFICE TO THE HOWARD GOLD STAMPING MACHINE COMPANY FURNISHED TO US BY MR. PUCINSKI INDICATES THAT THE INFORMATION AND NOTICE REQUIRED BY THE PROVISIONS OF ASPR 1-309 WERE NOT INCORPORATED THEREIN. WE HAVE OBSERVED THAT BIDDERS ARE ENTITLED TO RELY ON THE ASSUMPTION THAT AN AWARD OF A CONTRACT WILL ORDINARILY BE MADE WHEN THE GOVERNMENT SOLICITS BIDS. 41 COMP. GEN. 682, 687. THE PROVISIONS OF ASPR 1-309 RECOGNIZE THIS EXPECTANCY AND REQUIRE THAT IF A SOLICITATION FOR INFORMATIONAL OR PLANNING PURPOSES IS MADE THE REQUEST FOR QUOTATION SHALL CLEARLY STATE ITS PURPOSE AND, IN ADDITION, SHALL CARRY A PRESCRIBED NOTICE IN CAPITAL LETTERS ON THE FACE OF THE REQUEST.

THE NOTICE REQUIREMENTS OF ASPR 1-309 ARE INTENDED TO PROTECT PROSPECTIVE SUPPLIERS AGAINST THE VERY KIND OF SITUATION THAT OCCURRED HERE. COMPARE THE SITUATION IN B-153144, JUNE 4, 1964. WHILE IT MAY BE ASSERTED THAT THE WORDING OF THE DECEMBER 7 LETTER REASONABLY DISCLOSED THAT ITS PURPOSE WAS A SOLICITATION FOR INFORMATION OR PLANNING ONLY, THERE COULD HAVE BEEN NO DOUBT OF THIS HAD THE REQUIREMENTS OF PARAGRAPH 1-309 BEEN MET. IN ANY EVENT, THE FACT REMAINS THAT THE HOWARD COMPANY APPARENTLY BELIEVED THAT THE DECEMBER 7 LETTER WAS A BONA FIDE REQUEST FOR BIDS AND ACTED ACCORDINGLY. MOREOVER, IT WOULD APPEAR THAT THE APPREHENSION OF THE COMPANY WAS COMPOUNDED BY THE FAILURE OF THE SEYMOUR JOHNSON BASE PROCUREMENT OFFICE TO ANSWER THE COMPANY'S LETTERS REQUESTING INFORMATION ON THE STATUS OF THE PROCUREMENT.

IN OUR OPINION, THE FOREGOING RAISES SERIOUS QUESTIONS AS TO WHETHER MATERIAL PROVISIONS OF THE APPLICABLE REGULATIONS WERE COMPLIED WITH, AND WHETHER THE PROCEDURE FOLLOWED WAS SUCH AS TO ENCOURAGE FULL COMPETITION IN ANY FUTURE PROCUREMENT FROM THOSE SUPPLIERS WHO WERE SOLICITED. ACCORDINGLY, IT IS SUGGESTED THAT APPROPRIATE STEPS BE TAKEN WITHIN THE DEPARTMENT OF THE AIR FORCE TO GUARD AGAINST A RECURRENCE OF THIS SITUATION.