B-174601, APR 12, 1972, 51 COMP GEN 637

B-174601, APR 12, 1972, 51 COMP GEN 637

CONTRACTS - NEGOTIATIONS - SPECIFICATIONS UNAVAILABLE - DESCRIPTIVE LITERATURE REQUIREMENT UNDER A REQUEST FOR PROPOSALS (RFP), ISSUED PURSUANT TO 10 U.S.C. 2304(A)(10), WHICH AUTHORIZES NEGOTIATIONS WHEN IT IS IMPRACTICABLE TO DRAFT SPECIFICATIONS, THAT CONTAINED A DESCRIPTIVE CLAUSE - INSUFFICIENT FOR FORMAL ADVERTISING - RELATING TO THE DESIGN AND PERFORMANCE CHARACTERISTICS OF THE AIR COMPRESSOR BEING SOLICITED, THE DETERMINATION THE DESCRIPTIVE LITERATURE FURNISHED BY THE LOW OFFEROR DID NOT CONFORM, WHERE THE INFORMATION LACKING WAS CONTAINED IN THE RFP, WAS IN EFFECT A DETERMINATION THE PROPOSAL WAS NOT TECHNICALLY WITHIN A COMPETITIVE RANGE. HOWEVER, WHILE FAILURE TO COMPLY WITH A DESCRIPTIVE LITERATURE CLAUSE IN AN ADVERTISED PROCUREMENT REQUIRES BID REJECTION, THIS RULE DOES NOT AUTOMATICALLY APPLY IN A NEGOTIATED PROCUREMENT AND DISCUSSIONS SHOULD HAVE BEEN HELD WITH THE OFFEROR TO DETERMINE WHETHER ITS PROPOSAL WAS TECHNICALLY ACCEPTABLE. CONTRACTS - NEGOTIATION - IMPRACTICABLE TO OBTAIN - ADVERTISING IN LIEU OF NEGOTIATION THE FACT THAT NEGOTIATION IS AUTHORIZED UNDER 10 U.S.C. 2304(A)(10) WHEN IT IS IMPRACTICABLE TO OBTAIN COMPETITION, DOES NOT EXCLUDE ADVERTISING A PROCUREMENT WHEN IT IS FEASIBLE AND PRACTICABLE TO DO SO, AND, THEREFORE, BEFORE ISSUING A REQUEST FOR PROPOSALS WHERE AVAILABLE SPECIFICATIONS WERE "PRIMARILY PERFORMANCE AND DESIGN PARAMETERS," AND AVAILABLE DESIGN DATA WAS "INCOMPLETE, NOT SUFFICIENTLY DETAILED AND LARGELY UNCOORDINATED," CONSIDERATION SHOULD HAVE BEEN GIVEN TO ADVERTISING THE PERFORMANCE-TYPE SPECIFICATIONS AND TO PARAGRAPH 1 1206.2 OF THE ARMED SERVICES PROCUREMENT REGULATION, WHICH AUTHORIZES THE USE OF BRAND-NAME-OR-EQUAL PURCHASE DESCRIPTIONS WHEN MORE PRECISE AND DETAILED SPECIFICATIONS ARE NOT AVAILABLE, SINCE PERFORMANCE-TYPE SPECIFICATIONS AND FORMAL ADVERTISING ARE NOT MUTUALLY INCONSISTENT.

TO THE SECRETARY OF THE AIR FORCE, APRIL 12, 1972:

REFERENCE IS MADE TO THE JANUARY 12, 1972, LETTER FROM THE DEPUTY CHIEF, CONTRACT MANAGEMENT DIVISION, DIR/PROCUREMENT POLICY, DCS/S&L, HEADQUARTERS, UNITED STATES AIR FORCE, REGARDING THE PROTEST OF RIX INDUSTRIES AGAINST AWARD OF A CONTRACT UNDER RFP F33615-72-R 0553, BY THE AERONAUTICAL SYSTEMS DIVISION, AIR FORCE SYSTEMS COMMAND.

THE SOLICITATION, FOR ONE AIR COMPRESSOR AND ACCESSORY ITEMS, CONTAINED A REQUIREMENT FOR DESCRIPTIVE LITERATURE TO BE FURNISHED WITH PROPOSALS. PARAGRAPH D-5 OF THE RFP STATED THAT THE LITERATURE "IS REQUIRED TO ESTABLISH, FOR THE PURPOSE OF PROPOSAL EVALUATION AND AWARD, DETAILS OF THE PRODUCTS THE BIDDER PROPOSES TO FURNISH AS TO DESIGN AND PERFORMANCE CHARACTERISTICS." PARAGRAPH D-5 ALSO PROVIDED THAT FAILURE OF DESCRIPTIVE LITERATURE "TO SHOW THAT THE PRODUCT OFFERED CONFORMS TO THE SPECIFICATIONS AND OTHER REQUIREMENTS OF THIS PROPOSAL WILL REQUIRE REJECTION."

THE FOUR PROPOSALS RECEIVED BY THE OCTOBER 15, 1971, CLOSING DATE WERE REFERRED FOR TECHNICAL EVALUATION. THE EVALUATOR DETERMINED THAT THE DESCRIPTIVE LITERATURE SUBMITTED BY RIX DID NOT COVER PERFORMANCE CHARACTERISTICS AND THEREFORE ITS PROPOSAL COULD NOT BE EVALUATED. THE CONTRACTING OFFICER THEN REJECTED THE RIX PROPOSAL, EVEN THOUGH IT HAD SUBMITTED THE LOWEST PRICE, AND CONDUCTED NEGOTIATIONS WITH THE OTHER THREE OFFERORS. AWARD WAS MADE ON NOVEMBER 16, 1971, TO THE SECOND LOW OFFEROR.

THE PROTESTER CLAIMS THAT THE DESCRIPTIVE LITERATURE IT SUBMITTED DID MEET ALL REQUIREMENTS OF THE RFP AND THAT THE CONTRACTING OFFICER'S REJECTION OF ITS PROPOSAL WAS UNFAIR. IT ALSO ALLEGES THAT AWARD WAS IMPROPERLY MADE WHILE ITS PROTEST WAS PENDING.

RIX CLAIMS THAT BY INDICATING "N/A" NEXT TO THE RFP REQUIREMENT FOR A COMPLETE TECHNICAL PROPOSAL, INCLUDING AN ITEM BY ITEM DISCUSSION, THE CONTRACTING OFFICER "IMPLIED PREJUDICE AGAINST A TECHNICAL PRESENTATION" AND THEREBY ALLOWED THE OFFEROR "TO ESTABLISH THE AMOUNT AND STYLE OF DATA SUPPLIED AS LONG AS IT INCLUDED 'DESCRIPTIVE LITERATURE' *** ." FURTHER CONTENDS THAT THE LACK OF DETAIL IN THE SPECIFICATION STATEMENT OF WORK INDICATED AN "INTENTION *** TO NEGOTIATE FURTHER WITH THE MOST RESPONSIVE BIDDERS." ON THIS BASIS, IT SUBMITTED TWO DIAGRAMS, ONE LABELED "CROSS-SECTION" AND THE OTHER LABELED "INSTALLATION DETAIL," WHICH WAS FOUND TO BE INSUFFICIENT TO EVALUATE PERFORMANCE CHARACTERISTICS OF THE RIX COMPRESSOR.

THIS PROCUREMENT WAS NEGOTIATED PURSUANT TO 10 U.S.C. 2304(A)(10) BECAUSE IT WAS IMPRACTICABLE TO DRAFT SPECIFICATIONS ADEQUATE FOR FORMAL ADVERTISING. ARMED SERVICES PROCUREMENT REGULATION (ASPR) 3 805.1, IN IMPLEMENTATION OF 10 U.S.C. 2304(G), PROVIDES THAT IN ALL NEGOTIATED PROCUREMENTS, WITH CERTAIN STATED EXCEPTIONS NOT APPLICABLE HERE, WRITTEN OR ORAL DISCUSSIONS SHALL BE CONDUCTED WITH ALL RESPONSIBLE OFFERORS WHO SUBMIT PROPOSALS WITHIN A COMPETITIVE RANGE, PRICE AND OTHER FACTORS CONSIDERED. THE REJECTION OF RIX'S PROPOSAL WAS, IN EFFECT, A DETERMINATION THAT ITS PROPOSAL WAS NOT TECHNICALLY WITHIN A COMPETITIVE RANGE BECAUSE OF ITS FAILURE TO COMPLY LITERALLY WITH THE DESCRIPTIVE LITERATURE CLAUSE. WHILE THE FAILURE TO COMPLY WITH A PROPER DESCRIPTIVE LITERATURE CLAUSE IN A FORMALLY ADVERTISED PROCUREMENT REQUIRES BID REJECTION, WE DO NOT BELIEVE THE SAME RULE SHOULD AUTOMATICALLY EXCLUDE CONSIDERATION OF A PROPOSAL IN A NEGOTIATED PROCUREMENT WITHOUT CONSIDERATION OF THE ATTENDANT FACTS AND CIRCUMSTANCES. SEE 47 COMP. GEN. 29 (1967). IN THIS CONNECTION, WE NOTE THAT MUCH OF THE BASIC INFORMATION LACKING IN RIX'S DESCRIPTIVE LITERATURE WAS INCLUDED IN THE LINE ITEM DESCRIPTION AND STATEMENT OF WORK OF THE RFP TO WHICH RIX APPARENTLY ASSENTED IN SUBMITTING ITS PROPOSAL. ALSO, AS RIX POINTS OUT, SEVERAL PROVISIONS OF THE RFP "PLAYED-DOWN" THE NECESSITY FOR EXTENSIVE TECHNICAL DETAIL. FURTHERMORE, RIX'S PROPOSAL PRICE WAS CONSIDERABLY BELOW THE NEXT LOWEST PROPOSAL. IN THESE CIRCUMSTANCES, WE BELIEVE THE APPLICABLE RULES REQUIRED DISCUSSION WITH RIX TO DETERMINE WHETHER IN FACT ITS PROPOSAL WAS TECHNICALLY ACCEPTABLE.

WE NOTE THAT THE CONTRACT WAS NEGOTIATED PURSUANT TO 10 U.S.C. 2304(A)(10) WHICH AUTHORIZES PROCUREMENTS WITHOUT FORMAL ADVERTISING WHEN IT IS FOUND TO BE IMPRACTICABLE TO OBTAIN COMPETITION. THAT FINDING IS BY THE TERMS OF 10 U.S.C. 2310(B) FINAL. HOWEVER, WE NOTE THAT 10 U.S.C. 2304(A) MAKES IT CLEAR THAT FORMAL ADVERTISING SHOULD BE USED WHEN THAT METHOD IS FEASIBLE AND PRACTICABLE EVEN THOUGH NEGOTIATION COULD BE JUSTIFIED UNDER ONE OF THE 17 EXCEPTIONS. NEGOTIATION WAS SPECIFICALLY AUTHORIZED IN THIS INSTANCE BECAUSE THE AVAILABLE SPECIFICATIONS WERE "PRIMARILY PERFORMANCE AND DESIGN PARAMETERS" AND THAT AVAILABLE DESIGN DATA WERE "INCOMPLETE, NOT SUFFICIENTLY DETAILED AND LARGELY UNCOORDINATED."

WE DO NOT READ THE LAW ON THE APPLICABLE REGULATIONS TO PRECLUDE ADVERTISING ON THE BASIS OF PERFORMANCE-TYPE SPECIFICATIONS. INDEED, WE BELIEVE THAT PERFORMANCE-TYPE SPECIFICATIONS ARE NOT INFREQUENTLY EMPLOYED IN FORMALLY ADVERTISED PROCUREMENTS, AND ASPR 1-1206.2 SPECIFICALLY CONTEMPLATES THE USE OF BRAND-NAME-OR-EQUAL PURCHASE DESCRIPTIONS IN SUCH PROCUREMENTS WHERE MORE PRECISE AND DETAILED SPECIFICATIONS ARE NOT AVAILABLE.

ONE OF THE SERIOUS PROBLEMS WITH THE INSTANT PROCUREMENT IS THAT THE CONTRACTING OFFICER SOUGHT TO ACHIEVE FOR HIMSELF THE FLEXIBILITY OF NEGOTIATION WHILE AT THE SAME TIME LIMITING AT LEAST ONE OFFEROR TO THE RELATIVELY INFLEXIBLE REQUIREMENTS APPLICABLE UNDER FORMAL ADVERTISING. THAT APPROACH IS IMPROPER, UNFAIR TO THE COMPETITORS AND, ULTIMATELY, CONTRARY TO THE PUBLIC INTEREST. YOU MAY WISH TO POINT OUT TO YOUR CONTRACTING OFFICERS THAT THE LAW STILL REQUIRES THAT FORMAL ADVERTISING BE USED WHEREVER IT IS FEASIBLE AND PRACTICABLE TO DO SO, THAT PERFORMANCE -TYPE SPECIFICATIONS AND FORMAL ADVERTISING ARE NOT MUTUALLY INCONSISTENT AND, FINALLY, THAT WHERE NEGOTIATION IS EMPLOYED, ITS FLEXIBILITY SHOULD BE USED TO INSURE THAT COMPETITION IS ENHANCED RATHER THAN LIMITED.

IF THIS PROCUREMENT HAD BEEN FORMALLY ADVERTISED, WE WOULD HAVE SERIOUS RESERVATIONS AS TO THE SUFFICIENCY OF THE DESCRIPTIVE LITERATURE REQUIREMENT. WE HAVE HELD THAT A SOLICITATION REQUIRING DESCRIPTIVE DATA MUST CLEARLY ESTABLISH THE NATURE AND EXTENT OF THE DATA REQUIRED WITH SUFFICIENT SPECIFICITY TO PUT BIDDERS ON COMMON NOTICE OF WHAT DETAIL IS ESSENTIAL. 46 COMP. GEN. 315 (1966). IN THAT CASE, WE SAID:

*** ONE OF THE PRIMARY DEFICIENCIES TO BE CURED BY SPELLING OUT DESCRIPTIVE LITERATURE REQUIREMENTS WITH PARTICULARITY ARISES WHERE *** A LOW BIDDER SUBMITS DATA WHICH HE MAY REASONABLY BELIEVE SATISFIES A BROADLY STATED REQUIREMENT FOR DESCRIPTIVE LITERATURE, BUT WHICH DOES NOT IN FACT PROVIDE THE INFORMATION THE AGENCY FEELS IT NEEDS TO EVALUATE BIDS. *** THE RECITAL IN THE "DESCRIPTIVE LITERATURE" CLAUSE OF SUCH GENERAL SUBJECTS AS "PERFORMANCE CHARACTERISTICS," WHICH ARE LISTED IN THE FOOTNOTE TO ASPR 2 205.5(D)(2) AS SUBJECTS THAT MIGHT REQUIRE DESCRIPTION, DOES NOT PROVIDE SUFFICIENT DETAIL AS TO WHAT INFORMATION THE AGENCY NEEDS, AND THEREFORE DOES NOT PROVIDE FOR A COMMON EVALUATION OF BIDS. *** 46 COMP. GEN. 315, 317-318 (1966).

WITH RESPECT TO RIX'S ASSERTION THAT ITS PROTEST WAS PENDING AT THE TIME OF AWARD, WE DO NOT BELIEVE THE CONTRACTING OFFICER ACTED IMPROPERLY. RIX'S TELEGRAM OF NOVEMBER 3, 1971, TO THE CONTRACTING OFFICER REQUESTED "CONSIDERATION FOR RE-EVALUATION" OF ITS PROPOSAL "OR SUBMISSION TO THE GENERAL, WASHINGTON, D.C. FOR REVIEW." ITS FOLLOWUP LETTER OF NOVEMBER 5, 1971, AMPLIFIED THE BASIS FOR ITS REQUEST, BUT MADE NO MENTION OF PURSUING A PROTEST BEYOND THE CONTRACTING OFFICER. WHILE THIS CORRESPONDENCE COULD HAVE BEEN TREATED AS A FORMAL PROTEST, THE CONTRACTING OFFICER DID NOT ACT UNREASONABLY IN CONCLUDING THAT THERE WAS NO PROTEST PENDING AFTER HE COMPLIED WITH RIX'S REQUEST TO RECONSIDER THE RIX PROPOSAL.

WHILE WE ARE CONCERNED OVER THE DEFICIENCIES NOTED ABOVE, THERE IS NO EFFECTIVE REMEDY AVAILABLE AT THIS TIME TO CURE THEM. HOWEVER, WE STRONGLY URGE THAT APPROPRIATE ACTION BE TAKEN TO PREVENT A RECURRENCE IN FUTURE PROCUREMENTS.