B-161281, AUG. 10, 1967

B-161281, AUG. 10, 1967

BIDS - NEGOTIATION - SOLE SOURCE DECISION TO FLORIDA SYSTEMS CORP. RE PROTEST OF AWARD OF CONTRACT ON SOLE -SOURCE BASIS FOR DEVELOPMENT OF A COMPUTER PROGRAM AT EGLIN AIR FORCE BASE. A SOLE-SOURCE AWARD FOR COMPUTER PROGRAM RESULTING FROM AN UNSOLICITED PROPOSAL TO THE AIR FORCE ARMAMENT. LABORATORY BY THE CONTRACTOR WHICH PROCUREMENT IS FOR PURPOSE OF DEVELOPING THE PROPOSAL IS NOT AN UNJUSTIFIABLE NONCOMPETITIVE AWARD BUT COMES UNDER ASPR 4 106.2 AND IS SIMILAR TO CONTRACT AWARDED TO PROTESTANT. AS TO ALLEGATION OF PROPONENTS' LACK OF CAPABILITY AND QUALIFICATIONS SINCE EVIDENCE SHOWS PROPOSAL WORK OF PRESIDENT OF FIRM AND THAT HE HAS EXTENSIVE PAST ENGINEERING BACKGROUND, THERE IS NO BASIS TO FIND ABUSE OF CONTRACTING OFFICER'S DISCRETION IN MAKING DETERMINATION OF QUALIFICATIONS.

TO MR. CHARLES K. TAYLOR, JR., PRESIDENT, FLORIDA SYSTEMS CORPORATION:

REFERENCE IS MADE TO YOUR LETTER DATED APRIL 13, 1967, AND SUBSEQUENT COMMUNICATIONS, PROTESTING AN AWARD OF A CONTRACT TO VALPARAISO TECHNICAL SERVICES CORPORATION, VALPARAISO, FLORIDA, FOR DEVELOPMENT OF A COMPUTER PROGRAM AT EGLIN AIR FORCE BASE, FLORIDA.

THE RECORD FURNISHED BY THE DEPARTMENT OF THE AIR FORCE SHOWS THAT ON NOVEMBER 22, 1966, VALPARAISO SUBMITTED A DOCUMENT ENTITLED "UNSOLICITED PROPOSAL FOR DEVELOPING AN AERODYNAMIC DERIVATIVES PROGRAM" TO THE AIR FORCE ARMAMENT LABORATORY, EGLIN AIR FORCE BASE. AFTER THOROUGH EVALUATION THE LABORATORY CONCLUDED THAT THE PROPOSED COMPUTATION TECHNIQUES AND PROGRAM APPEARED TO OFFER SIGNIFICANT IMPROVEMENT OVER EXISTING DEVELOPMENT PROGRAMS IN THAT FIELD. ACCORDINGLY, A FUNDED PURCHASE REQUEST WAS SUBMITTED TO THE PROCUREMENT DIVISION, TOGETHER WITH DOCUMENTATION SUPPORTING A SOLE-SOURCE PROCUREMENT. ON MARCH 15, 1967, THE CONTRACTING OFFICER FORWARDED A SYNOPSIS OF THIS CONTEMPLATED PROCUREMENT TO COMMERCE BUSINESS DAILY FOR PUBLICATION IN ACCORDANCE WITH ARMED SERVICES PROCUREMENT REGULATION 1-1003.1. ON MARCH 17, 1967, REQUEST FOR PROPOSAL F08635-67 R-0159 WAS FORWARDED TO VALPARAISO. PROPOSAL HAS BEEN RECEIVED FROM VALPARAISO, BUT AN AWARD HAS NOT BEEN MADE.

YOU ASSERT THAT THIS PROCUREMENT REPRESENTS AN UNJUSTIFIABLE NONCOMPETITIVE PRACTICE, AND THAT THE EDUCATIONAL AND TECHNICAL QUALIFICATIONS AND THE TECHNICAL CAPABILITIES OF THE BIDDER ARE INCONSISTENT WITH THE CONTEMPLATED PROCUREMENT.

GENERALLY, SUPPLIES AND SERVICES FOR THE GOVERNMENT ARE REQUIRED TO BE PROCURED BY FORMAL ADVERTISING. THERE ARE INSTANCES, HOWEVER, WHEN FORMAL ADVERTISING IS NOT FEASIBLE, AND THE PROCUREMENT AGENCY IS AUTHORIZED TO NEGOTIATE A PURCHASE OR A CONTRACT. IN THIS REGARD, 10 U.S.C. 2304/A) (11) PROVIDES AS FOLLOWS:

"/A) PURCHASES OF AND CONTRACTS FOR PROPERTY OR SERVICES COVERED BY THIS CHAPTER SHALL BE MADE BY FORMAL ADVERTISING IN ALL CASES IN WHICH THE USE OF SUCH METHOD IS FEASIBLE AND PRACTICABLE UNDER THE EXISTING CONDITIONS AND CIRCUMSTANCES. IF USE OF SUCH METHOD IS NOT FEASIBLE AND PRACTICABLE, THE HEAD OF AN AGENCY, SUBJECT TO THE REQUIREMENTS FOR DETERMINATIONS AND FINDINGS IN SECTION 2310, MAY NEGOTIATE SUCH A PURCHASE OR CONTRACT, IF

"/11) THE PURCHASE OR CONTRACT IS FOR PROPERTY OR SERVICES THAT HE DETERMINES TO BE FOR EXPERIMENTAL, DEVELOPMENTAL, OR RESEARCH WORK, OR FOR MAKING OR FURNISHING PROPERTY FOR EXPERIMENT, TEST, DEVELOPMENT OR RESEARCH; "

FURTHER, ARMED SERVICES PROCUREMENT REGULATION 4-106.2 READS AS FOLLOWS:

"/D) THE FOLLOWING EXAMPLES ARE ILLUSTRATIVE OF CIRCUMSTANCES WHERE THERE MAY BE NO SUBSTANTIAL QUESTION AS TO CHOICE OF SOURCE:

"/II) THE PURPOSE OF THE CONTRACT IS TO EXPLORE AN UNSOLICITED PROPOSAL WHICH OFFERS SIGNIFICANT SCIENTIFIC OF TECHNOLOGICAL PROMISE, REPRESENTS THE PRODUCT OF ORIGINAL THINKING, AND WAS SUBMITTED IN CONFIDENCE BY ONE SOURCE.'

ACCORDINGLY, IN LIGHT OF THE EVIDENCE THAT THIS PROCUREMENT WAS FOR THE PURPOSE OF DEVELOPING A PROPOSAL MADE AND SUBMITTED BY THE PRESIDENT OF VALPARAISO ON HIS OWN INITIATIVE, WE CANNOT CONCUR IN YOUR CONCLUSION THAT IT REPRESENTS AN UNJUSTIFIABLE NONCOMPETITIVE PRACTICE. IT IS POINTED OUT THAT THIS PROCUREMENT IS JUSTIFIED ON A BASIS SIMILAR TO CONTRACT F08635- 67-C-0041 WHICH WAS AWARDED TO YOUR COMPANY.

YOUR SECOND ASSERTION IS THAT THE BIDDER DOES NOT POSSESS THE EDUCATIONAL AND TECHNICAL QUALIFICATIONS OR CAPABILITIES CONSISTENT WITH THE CONTEMPLATED PROCUREMENT. PURSUANT TO ARMED SERVICES PROCUREMENT REGULATION 4-106.1/C) THE LABORATORY PROJECT ENGINEER STATED THE CONTRACTOR'S EXPERIENCE IN THE AREA SET FORTH IN THE UNSOLICITED PROPOSAL WAS UNIQUE AND JUSTIFIED THIS SOLE-SOURCE PROCUREMENT. IN VIEW OF THE EVIDENCE THAT THE SUBJECT MATTER OF THE PROCUREMENT, THE UNSOLICITED PROPOSAL, WAS THE WORK PRODUCT OF VALPARAISO'S PRESIDENT AND THE EXTENSIVE PAST ENGINEERING BACKGROUND OF THE PRESIDENT IN RELATED AREAS, WE DO NOT FIND ANY ABUSE OF DISCRETION IN MAKING THAT DETERMINATION.

AS YOU WERE ADVISED BY OUR LETTER DATED JULY 7, 1967, THE ALLEGATIONS OF COLLUSION AND VIOLATION OF 18 U.S.C. 207/A) INVOLVE CRIMINAL MATTERS WHICH ARE NOT SUBJECT TO THE JURISDICTION OF THIS OFFICE. WE ARE ADVISED THAT NO AWARD WILL BE MADE UNDER THIS REQUEST FOR PROPOSALS UNTIL THE INVESTIGATION OF THESE ALLEGATIONS HAS BEEN COMPLETED BY THE AIR FORCE OFFICE OF SPECIAL INVESTIGATIONS, AND IT HAS BEEN DETERMINED THAT VALPARAISO IS QUALIFIED AND ELIGIBLE TO RECEIVE AN AWARD UNDER APPLICABLE LAWS AND REGULATIONS.