B-159363, SEP. 9, 1966

B-159363, SEP. 9, 1966

TO LAMAR, INCORPORATED:

FURTHER REFERENCE IS MADE TO YOUR LETTER RECEIVED HERE JUNE 7, 1966, PROTESTING THE AWARD TO BIG STATE INDUSTRIES COMPANY, INCORPORATED, MINERAL WELLS, TEXAS, OF A ONE-YEAR INDEFINITE QUANTITY CONTRACT NO. DA 23 -204 AMC-04242/T), DATED MAY 10, 1966, WITH A FIRM FIXED-UNIT PRICE FOR SERVICES AND COST REIMBURSEMENT FOR PARTS, COVERING THE OVERHAUL/MODIFICATION OF A MINIMUM QUANTITY OF 20 AND A MAXIMUM QUANTITY OF 408 OH-23 ARMY HELICOPTER TRANSMISSION ASSEMBLIES.

SOLICITATION NO. AMC/T/23-204-381-66 (A REQUEST FOR PROPOSALS) WAS ISSUED ON JANUARY 11, 1966. ACCOMPANYING THE SOLICITATION AND MADE A PART THEREOF WERE THE "ADDITIONAL TERMS AND CONDITIONS OF SOLICITATION AND OFFER," THE "WORK REQUIREMENTS" (NO. WR-55-1560-117-B-/1), AND THE OVERHAUL CHANGE ORDERS. PARAGRAPH 25 OF THE "ADDITIONAL TERMS AND CONDITIONS OF SOLICITATION AND OFFER" STATED:

"25. FAA RATING: FOR THE PURPOSE OF EVALUATING OFFEROR'S EXPERIENCE, EACH OFFEROR SHALL INDICATE WHETHER OR NOT HIS FACILITY IS CERTIFIED BY FAA, OR HE HAS IN HIS EMPLOY AN INSPECTOR WHO HAS A FAA INSPECTION AUTHORIZATION CERTIFICATE. THE OFFEROR SHALL DESIGNATE HIS FAA RATING ELOW:

PARAGRAPH 1.5.3 OF THE "WORK REQUIREMENTS" STATED:

"CERTIFICATION OF CONTRACTOR PERSONNEL

CONTRACTORS PERSONNEL INCLUDING WELDERS, CERTIFYING TO ACCOMPLISHMENT OF MAINTENANCE, REPAIR, SERVICING, RECONDITION, REHABILITATION, AND MODIFICATION OF TRANSMISSION ASSEMBLIES ACCORDING TO THIS REQUIREMENT WILL QUALIFY UNDER CERTIFICATION REQUIREMENTS OF FAA REGULATIONS. CHANGES TO THESE REQUIREMENTS MUST BE APPROVED BY THE CONTRACTING OFFICER OR HIS AUTHORIZED REPRESENTATIVE.'

TEN PROPOSALS WERE RECEIVED. EIGHT OF THE PROPOSERS STATED THEIR FAA RATINGS, WHILE YOUR CORPORATION AND ONE OTHER FIRM FAILED TO LIST THIS INFORMATION. YOUR FINAL PROPOSAL WAS $17,821.90 LOWER THAN THAT OF THE SECOND LOW PROPONENT, BIG STATE INDUSTRIES (BASED ON THE MAXIMUM QUANTITY, ALL FACTORS INCLUDING DISCOUNT CONSIDERED). THE TOTAL NUMBER OF HOURS YOU ALLOCATED TO EACH TRANSMISSION ASSEMBLY WAS 29.5, COMPARED TO THAT ALLOCATED BY BIG STATE INDUSTRIES, WHICH WAS 41.0. ON MAY 10, 1966, THE CONTRACTING OFFICER AWARDED THE CONTRACT TO BIG STATE INDUSTRIES, AS IT WAS HIS DETERMINATION THAT YOUR FAILURE TO OBTAIN FAA CERTIFICATION MADE YOU NON-RESPONSIVE TO THE SOLICITATION.

IN YOUR LETTER OF PROTEST YOU STATE THAT THREE SURVEYS WERE CONDUCTED OF YOUR ORGANIZATION, AND THAT YOU UNDERSTOOD YOU WERE CAPABLE OF PERFORMING THE WORK. YOU ALSO STATE THAT NO REFERENCE WAS MADE TO ANY REQUIREMENT FOR AN FAA CERTIFICATE IN THE TELEGRAM DATED MARCH 22, 1966, FROM THE CONTRACTING OFFICER, INQUIRING IF YOUR PROPOSAL REMAINED FIRM AND ASKING FOR A STATEMENT THAT YOU WERE CAPABLE OF PERFORMING THE WORK.

THE CONTRACTING OFFICER REPORTS THAT WHILE TWO PRE-AWARD SURVEYS WERE CONDUCTED, ONE BY DEFENSE CONTRACT ADMINISTRATION SERVICES REGION, WICHITA, KANSAS AND THE SECOND BY THE AVIATION COMMAND, ST. LOUIS, MISSOURI, BOTH OF WHICH CONCLUDED THAT YOU WERE CAPABLE, THESE SURVEYS WERE NOT AUTHORIZED TO CERTIFY YOU UNDER FAA REQUIREMENTS. THE TELEGRAM DATED MARCH 22, 1966, REQUESTED YOU TO STATE THAT ALL THE REQUIREMENTS OF THE SOLICITATION WERE UNDERSTOOD. THE FAA REQUIREMENTS WERE AT ALL TIMES INCLUDED IN THE SOLICITATION AND THE CONTRACTING OFFICER DID NOT THINK IT NECESSARY TO SINGLE THEM OUT TO YOU. THE THIRD SURVEY WAS NOT AN OFFICIAL SURVEY BUT WAS THE APRIL 5, 1966, VISIT TO YOUR FACILITIES BY THE CONTRACTING OFFICER'S TEAM. AT THIS MEETING IT WAS ASCERTAINED THAT YOU HAD EXPERIENCE ON AUTOMOTIVE TRANSMISSIONS, FARM IMPLEMENT ACCESSORIES, AND SMALL AIRCRAFT COMPONENTS, NAMELY ACTUATORS AND CABIN PRESSURE REGULATORS FOR T-38 AIRCRAFT; HOWEVER, ACCORDING TO THE CONTRACTING OFFICER'S REPORT YOU INDICATED AT THE APRIL 5 MEETING THAT YOUR FIRM HAD NO EXPERIENCE ON AIRCRAFT TRANSMISSIONS, THAT IT DID NOT HAVE AN FAA RATING FOR THE OVERHAUL/MODIFICATION OF OH-23 TRANSMISSIONS, AND THAT YOUR PERSONNEL WERE NOT QUALIFIED UNDER CERTIFICATION REQUIREMENTS OF FAA REGULATIONS AS REQUIRED BY PARAGRAPH 1.5.3 OF THE SOLICITATION'S WORK REQUIREMENTS.

YOU STATE THAT IT WAS NOT UNTIL APRIL 16, 1966, THAT INQUIRY WAS MADE RELATIVE TO FAA CERTIFICATION. HOWEVER, AS HAS ALREADY BEEN POINTED OUT, YOU INFORMED THE CONTRACTING OFFICER ON APRIL 5, 1966, THAT YOU DID NOT HAVE FAA CERTIFICATION FOR THE OH-23 TRANSMISSION. THE CONTRACTING OFFICER REPORTS:

"FINDING: FAA CERTIFICATION HAS BEEN A REQUIREMENT FOR THE WORK REQUIRED UNDER THIS PROCUREMENT AT LEAST FROM THE PUBLICATION OF THE CURRENT WORK REQUIREMENT: WR 55-1560-177-B-/1), DATED 7 MAY 1963. IT WAS ON 5 APRIL 1966, AT THE CONTRACTING OFFICER'S MEETING WITH MR. LEJUERRNE OF LAMAR THAT THE CONTRACTOR INDICATED THAT HE WAS, IN FACT, NOT FAA CERTIFIED. SPECIFIC INQUIRY WAS MADE BY THE CONTRACTING OFFICER AS TO FAA CERTIFICATION ON THAT DATE, I.E., 5 APRIL 1966 * * *. ON 15 APRIL 1966, A TWX * * * WAS FORWARDED TO ALL PROSPECTIVE CONTRACTORS WHO HAD RESPONDED TO THE SOLICITATION. THIS WIRE REQUESTED THAT ALL OFFERORS SUBMIT A STATEMENT THAT THEY WERE, PURSUANT TO PARAGRAPH 25 OF THE ADDITIONAL TERMS AND CONDITIONS OF THE SOLICITATION AND OFFER, AND PARAGRAPH 1.5.3 OF THE APPLICABLE WORK REQUIREMENT, QUALIFIED UNDER CERTIFICATION REQUIREMENTS OF FAA REGULATIONS.

"LAMAR BY WIRE * * * , DATED 25 APRIL 1966, RESPONDED TO THIS TWX BY STATING AFFIRMATIVELY THAT "LAMAR, INC. IS AN APPROVED FAA REPAIR STATION AND THAT WE ARE PURSUANT TO PARAGRAPH 1.5.3 OF WR 55-1560-177 B-11 (SIC) AND PARAGRAPH 25.' HOWEVER, IN RESPONSE TO INQUIRY BY THE CONTRACTING OFFICER, FAA REPORTED THAT AS OF 25 APRIL 1966 LAMAR WAS NOT CERTIFIED TO OVERHAUL THE OH-23 TRANSMISSION * * *.'

IN YOUR PROTEST LETTER A STATEMENT WAS MADE THAT FAA, WICHITA, KANSAS, INFORMED YOU IT DID NOT DEEM FAA CERTIFICATION APPROPRIATE FOR AN ARMY CONTRACT. ALSO, THAT FAA ADVISED YOU THAT YOU WOULD HAVE TO HAVE SOME OF THE HELICOPTER TRANSMISSIONS ON HAND BEFORE THEY COULD CONSIDER YOU FOR CERTIFICATION. IN A LETTER TO THE CONTRACTING OFFICER, DATED JULY 6, 1966, CHESTER N. CARVER, PRINCIPAL MAINTENANCE INSPECTOR, FAA, WICHITA, KANSAS, STATED THAT YOU HAD BEEN ADVISED BY FAA, WICHITA, KANSAS, FOLLOWING YOUR REQUEST FOR INFORMATION RELATIVE TO OBTAINING CERTIFICATION OF YOUR REPAIR FACILITY, THAT MILITARY CONTRACTS DID NOT HAVE ANY BEARING ON CERTIFICATION OF REPAIR STATION,RATHER ABILITY AND EQUIPMENT WERE THE DETERMINING FACTORS. THE CONTRACTING OFFICER WAS ALSO INFORMED IN THIS LETTER FROM FAA THAT YOU DID MAKE APPLICATION AND OBTAINED CERTIFICATES ON A LIMITED "ACCESSORY" RATING, BUT THAT YOU DID NOT QUALIFY AND DID NOT APPLY FOR CERTIFICATION IN RESPECT TO HELICOPTER TRANSMISSIONS.

YOU ALLEGE THAT AT NO TIME HAD ANYONE IN AUTHORITY IN THIS MATTER EVER INTIMATED THAT YOU WERE NOT FULLY CAPABLE OF PERFORMING THE WORK, DID NOT UNDERSTAND THE REQUIREMENTS FOR THE WORK, OR DID NOT HAVE THE NECESSARY TOOLS AND EQUIPMENT TO PERFORM THE WORK. WE QUOTE FROM YOUR LETTER:

"IN FACT, ON APRIL 16TH THE CONTRACTING OFFICER ADVISED LAMAR,"YOU ARE WITHIN THE SPHERE OF CONSIDERATION FOR THE AWARD OF THIS CONTRACT.'"

THE CONTRACTING OFFICER HAS INFORMED US THAT APRIL 15, 1966, TELEGRAM, SENT TO ALL PROSPECTIVE CONTRACTORS WHO WERE BEING CONSIDERED FOR THE AWARD, INFORMED THEM THAT THEY WERE WITHIN THE SPHERE OF CONSIDERATION FOR THE AWARD. THE WIRE CONCLUDED WITH THIS SENTENCE, "THIS CORRESPONDENCE IS NOT TO BE INTERPRETED AS AN OFFER TO ENTER INTO A CONTRACT.' AS HAS ALREADY BEEN SAID IN THE ABOVE-QUOTED PORTION OF THE CONTRACTING OFFICER'S REPORT, WHAT THE TELEGRAM DID ADDRESS ITSELF TO WAS A REQUEST THAT ALL PROPONENTS AFFIRMATIVELY STATE THAT THEY WERE QUALIFIED UNDER FAA REGULATIONS TO PERFORM MAINTENANCE WORK ON THE OH-23 TRANSMISSION. YOUR TELEGRAM DATED APRIL 25, 1966 DID AFFIRMATIVELY STATE THAT YOU WERE AN APPROVED FAA REPAIR STATION PURSUANT TO THE SOLICITATION'S REQUIREMENTS. HOWEVER, FAA, WICHITA, KANSAS, BY TELEGRAM DATED APRIL 28, 1966, IN RESPONSE TO INQUIRY MADE BY THE CONTRACTING OFFICER, INFORMED HIM THAT YOU WERE NOT A CERTIFIED REPAIR STATION FOR OH-23 TRANSMISSIONS.

ALL HELICOPTER TRANSMISSION OVERHAULS ARE CONSIDERED BY THE FAA TO BE MAJOR REPAIRS AND ON CIVIL AIRCRAFT A MAINTENANCE RELEASE FORM IS REQUIRED TO RETURN THEM TO SERVICE. THE HELICOPTER TRANSMISSION IS NOT CONSIDERED AS PART OF THE POWER PLANT, NOR AS AN ACCESSORY, BUT IS REGARDED AS PART OF THE AIRCRAFT ITSELF. IT IS A SAFETY-OF-FLIGHT ITEM ENTAILING HIGHLY TECHNICAL AND SPECIALIZED WORK TO MAINTAIN. THE ARMY AVIATION MATERIEL COMMAND INCLUDED THE FAA CERTIFICATION REQUIREMENT IN THE SOLICITATION BECAUSE IT WAS CONCERNED ABOUT THE SAFETY FACTOR AND THE PROPER FUNCTIONING OF THEIR EQUIPMENT. THE FAA CERTIFICATION OF REPAIR STATIONS TO PERFORM SUCH WORK ON SIMILAR CIVIL AIRCRAFT IS A REASONABLE STANDARD APPLICABLE TO MILITARY CRAFT.

WE HAVE CONSISTENTLY HELD THAT THE QUESTION OF THE QUALIFICATIONS OF A PROPOSED CONTRACTOR PRIMARILY IS FOR DETERMINATION BY THE ADMINISTRATIVE OFFICERS CONCERNED AND SUCH DETERMINATION WILL NOT BE OVERRULED BY US IN THE ABSENCE OF BAD FAITH OR THE LACK OF A REASONABLE FACTUAL BASIS. COMP. GEN. 430; 36 ID. 42. IN THE INSTANT MATTER, THE RECORD INDICATES THAT EVERY ATTEMPT WAS MADE BY THE CONTRACTING OFFICER TO DETERMINE WHETHER YOU WERE RESPONSIVE TO THE REQUIREMENTS OF THE SOLICITATION. WAS DETERMINED THAT THE PRICES YOU SUBMITTED IN THE PROPOSAL AS WELL AS THE NUMBER OF HOURS IN WHICH YOU CONTEMPLATED DOING THE WORK NECESSARY FOR THE OVERHAUL/MODIFICATION OF THE TRANSMISSION, BEING PREDICATED UPON WORK TO BE PERFORMED IN A NON FAA-CERTIFIED SHOP BY NON-FAA-CERTIFIED PERSONNEL, WERE UNREALISTICALLY LOW WHEN CONSIDERED NEXT TO THE PROPOSAL OF BIG STATE INDUSTRIES WHOSE PRICE AND HOURS WERE PREDICATED UPON WORK TO BE PERFORMED IN AN FAA-CERTIFIED SHOP BY FAA-CERTIFIED PERSONNEL. IT IS OUR OPINION THAT THE ACTION OF THE CONTRACTING OFFICER IN AWARDING THE CONTRACT TO BIG STATE INDUSTRIES WAS BASED ON AN EXTENSIVE AND CAREFUL ANALYSIS OF THE PROPOSALS.

ACCORDINGLY, THERE DOES NOT APPEAR TO BE ANY BASIS FOR OBJECTION BY OUR OFFICE TO THE AWARD MADE IN THIS CASE.