B-175567, JUL 13, 1972

B-175567, JUL 13, 1972

BID PROTEST - SOLE SOURCE PROCUREMENT - TIME OF THE ESSENCE DECISION DENYING PROTEST OF ENERGY SYSTEMS, AGAINST PROPOSED SOLE SOURCE PROCUREMENT FROM DYNAMICS CORPORATION OF AMERICA FOR 14 MICROWAVE POWER AMPLIFIERS BY U.S. ARMY ELECTRONICS COMMAND. THE TERMINAL SYSTEM OF WHICH THE AMPLIFIERS ARE A COMPONENT OF MUST BE COMPLETED BY JUNE, 1973. VERIFIED DISCLOSURE DATA WILL NOT BE AVAILABLE UNTIL LATE 1972, AND DRAWINGS ADEQUATE FOR COMPETITIVE PROCUREMENT COULD NOT BE AVAILABLE BEFORE FEBRUARY, 1973. PRODUCTION LEAD TIME WITH ADEQUATE DRAWINGS IS ESTIMATED TO BE 7 MONTHS AND A FIRM WITH DATA ONLY COULD SPEND 12 MONTHS ON DEVELOPMENT. UNDER THESE CIRCUMSTANCES, SOLE SOURCE PROCUREMENT WAS PROPER AS NO EVIDENCE WAS GIVEN WHICH WOULD SUPPORT A FINDING THAT THE AGENCY WAS ARBITRARY IN ITS DETERMINATION THAT, UNDER COMPETITIVE PROCUREMENT, THE DELIVERY DATE COULD NOT BE MET.

TO ENERGY SYSTEMS:

REFERENCE IS MADE TO YOUR TELEGRAM DATED MARCH 28, 1972, AND SUBSEQUENT COMMUNICATIONS, PROTESTING A PROPOSED SOLE-SOURCE PROCUREMENT FROM DYNAMICS CORPORATION OF AMERICA, ELECTRONIC SYSTEMS DIVISION, FOR FOURTEEN MICROWAVE POWER AMPLIFIERS FOR USE IN A RETROFIT PROGRAM OF AN/MSC-46 SATELLITE COMMUNICATIONS TERMINALS BY THE UNITED STATES ARMY ELECTRONICS COMMAND AT FORT MONMOUTH, NEW JERSEY.

YOU STATE THAT THE CONTRACTING OFFICER HAS EXPLAINED THAT THE BASIS OF HIS SOLE-SOURCE DECISION IS A DESIRE TO STANDARDIZE AND OBTAIN EQUIPMENT INTERCHANGEABLE WITH A PROVEN DESIGN, AVOIDING THE POSSIBILITY THAT EQUIPMENT OF ANOTHER DESIGN WILL HAVE TO BE PLACED IN THE INVENTORY.

IT IS REPORTED THAT SEVERAL YEARS AGO PHILCO-FORD CORPORATION, WESTERN DEVELOPMENT LABORATORIES, WAS AWARDED CONTRACT DAAB07-70-C 0234, ON A COMPETITIVE BASIS, TO DEVELOP HT/MT SATELLITE COMMUNICATIONS TERMINALS FOR THE UNITED STATES ARMY SATELLITE COMMUNICATIONS AGENCY. PHILCO-FORD SUBCONTRACTED ON A COMPETITIVE BASIS A SUBSYSTEM - LOW POWER AMPLIFIERS - TO DYNAMICS CORPORATION OF AMERICA. THIS SUBSYSTEM WAS DESIGNED AND DEVELOPED BY DYNAMICS AND HAS BEEN DELIVERED AND ACCEPTED BY PHILCO-FORD, THE PRIME CONTRACTOR.

THE CURRENT PROCUREMENT, UNDER PWD 38-2-72484-01-38-CA, CALLS FOR FABRICATION AND TEST OF FOURTEEN EACH LOW POWER AMPLIFIERS (3KW TWT), IN ACCORDANCE WITH ARMY SATELLITE COMMUNICATIONS TECHNICAL REQUIREMENTS NO. SC-CE-1011, DATED FEBRUARY 25, 1972. THIS PROCUREMENT RESULTED FROM A DIRECTIVE, IN JANUARY 1972, BY THE DEFENSE COMMUNICATIONS AGENCY TO THE ARMY SATELLITE COMMUNICATIONS AGENCY TO PROVIDE A LOW POWER AMPLIFIER SUBSYSTEM AS PART OF THE MODIFICATION PROGRAM FOR THE AN/MSC 46 TERMINALS IN THE PHASE II, STAGE 1B, DEFENSE SATELLITE COMMUNICATIONS SYSTEM OPERATIONAL ENVIRONMENT. THE LOW POWER AMPLIFIER, DEVELOPED BY DYNAMICS CORPORATION OF AMERICA (FOR THE AN/MSC 60 AND 61 TERMINALS USED IN THE SYSTEMS PROCURED EARLIER), HAS BEEN TESTED AND THE DEMONSTRATED PERFORMANCE EQUALS THAT REQUIRED FOR THE TRANSMITTER SUBSYSTEM PORTION OF THE AN/MSC-46 TERMINAL.

IT IS REPORTED THAT THE AN/MSC-46 TERMINAL WITH THE LOW POWER AMPLIFIER SUBSYSTEM MUST BE COMPLETED BY JUNE 1973, THAT VERIFIED DISCLOSURE DATA FOR THIS SUBSYSTEM IS NOT AVAILABLE AT THIS TIME AND WILL NOT BE AVAILABLE UNTIL LATE IN 1972, AND THAT DRAWINGS ADEQUATE FOR COMPETITIVE PROCUREMENT WILL NOT BE AVAILABLE UNTIL AT LEAST FEBRUARY 1973. PRODUCTION LEAD TIME WITH ADEQUATE DRAWINGS IS ESTIMATED TO BE SEVEN MONTHS AND A FIRM WITHOUT THE DATA AND DRAWINGS COULD SPEND 12 MONTHS ON DEVELOPMENT. THE TIMES STATED APPEAR TO PRECLUDE ANY SOURCE OTHER THAN DYNAMICS FROM MEETING THE REQUIRED DELIVERY SCHEDULE. AUTHORITY TO CONDUCT A SOLE-SOURCE PROCUREMENT WAS GRANTED ON MARCH 16, 1972.

IN SUPPORT OF YOUR PROTEST YOU CONTEND:

1. THE POWER AMPLIFIERS PROVIDED FOR THE AN/MSA-60 AND 61 WERE 3KW TWT AND 8KW KLYSTRON, WHEREAS THIS PROCUREMENT PROPOSES TO PROVIDE A 5KW AMPLIFIER.

2. THE AN/MSA-60 AND 61 ARE STILL IN THE TESTING STAGE WHICH WOULD NOT BE COMPLETED FOR ANOTHER 60-90 DAYS.

3. THE AN/MSC-46 HAS BEEN IN INVENTORY FOR SEVERAL YEARS AND IS EQUIPPED WITH A KLYSTRON AMPLIFIER, BUT IS CURRENTLY BEING RETROFITTED WITH A NEW KLYSTRON. IF THE INTENT IS TO PROVIDE A DUAL TRANSMIT CAPABILITY FOR THE AN/MSC-46, TIME URGENCY CANNOT BE SO GREAT IN VIEW OF THE FACT THAT IT HAS OPERATED FOR MANY YEARS WITHOUT THAT CAPABILITY.

4. ENERGY SYSTEMS' CAPABILITY TO DESIGN AND/OR MODIFY EXISTING DESIGN IS EQUAL TO, OR EXCEEDS THAT OF DYNAMICS CORPORATION OF AMERICA. ADDITION, OTHER CAPABLE FIRMS EXIST, AND THE GOVERNMENT REQUIREMENTS CAN BE SET OUT ADEQUATELY FOR THE PURPOSES OF OBTAINING COMPETITIVE BIDS.

5. INVESTMENT COSTS BY THE GOVERNMENT IN THIS EQUIPMENT HAVE BEEN MINIMAL TO DATE, AND SHOULD BE DISREGARDED UNTIL COMPETITIVE BIDDING DEMONSTRATES THE NET COST OF THE EQUIPMENT.

THE CONTRACTING OFFICER HAS COMMENTED ON THE ABOVE POINTS AS FOLLOWS:

1. THE CURRENT PROCUREMENT IS FOR 3KW TWT POWER AMPLIFIERS AND NOT 5KW TWT AMPLIFIERS AS STATED BY THE PROTESTER. THIS PROCUREMENT IS FOR THE IDENTICAL AMPLIFIERS DEVELOPED UNDER THE PHILCO-FORD WESTERN DEVELOPMENT LABORATORY SUBCONTRACT.

2. ALTHOUGH THE QUALIFICATION TESTING REMAINING ON THE AN/MSC-60/61 IS FINAL ACCEPTANCE SYSTEM TESTING ENCOMPASSING ALL TERMINAL COMPONENTS, THE 3KW TWT POWER AMPLIFIERS USED IN THE SYSTEM HAVE ALREADY BEEN TESTED AND ACCEPTED BY THE PRIME CONTRACTOR.

3. AS TO URGENCY OF THE PRESENT PROCUREMENT, THE CONTRACTING OFFICER STATES IN PART:

"THE MODIFICATION TO THE KLYSTRON AMPLIFIER OF THE AN/MSC-46 TO PROVIDE ADDITIONAL SYSTEM CAPABILITY AND THE ADDITION OF A LOW POWER AMPLIFIER IN THAT TERMINAL, THROUGH THIS PROTESTED PROCUREMENT, ARE THE RESULT OF NUMEROUS SYSTEM DESIGN TRADE-OFFS CONDUCTED BY THE JCS, DEFENSE COMMUNICATIONS AGENCY AND USA SATCOMA. THIS PROCUREMENT PROVIDES ONLY A PART OF THE EQUIPMENTS TO BE PROVIDED FOR MODIFICATIONS TO THE AN/MSC-46. THE DELIVERY SCHEDULE SET FORTH IN THE PROTESTED FWD DOVETAILS WITH SCHEDULED DELIVERIES OF OTHER PROCURED EQUIPMENTS TO BE INTEGRATED SIMULTANEOUSLY INTO THE AN/MSC-46. NO CONTRACTOR OTHER THAN DCA CAN MAKE DELIVERY OF THE 3 KW TWT POWER AMPLIFIER WITHIN THE REQUIRED TIME FRAME. THE URGENCY REQUIREMENT FOR THE MODIFIED AN/MSC 46 WITH ALL THE INTEGRATED EQUIPMENTS IS CONTAINED IN THE OPERATIONAL REQUIREMENT DATE FOR PHASE II DSCS OPERATION IMPOSED BY SEC DEF MEMO #37."

4. THE CONTRACTING OFFICER OFFERS NO COMMENT AS TO ENERGY SYSTEMS CAPABILITIES BUT DOES COMMENT THAT PHILCO-FORD, WESTERN DEVELOPMENT LABORATORY, SELECTED DYNAMICS CORPORATION OF AMERICA IN A COMPETITIVE SUBCONTRACT AWARD. HE ALSO OBSERVES THAT THE LIMITED TIME FRAME ALLOWED PREVENTS A NEW DEVELOPMENT BY ANOTHER OR EVEN BY THE SAME CONTRACTOR FOR THE 3KW TWT POWER AMPLIFIER.

5. AS TO DEVELOPMENT COSTS OF THE POWER AMPLIFIER BEING PROCURED, IT IS STATED THAT CONSIDERABLE TIME AND EFFORT HAVE BEEN EXPENDED TO SECURE THE SOFTWARE REQUIREMENTS OF CONTRACT NO. DAAB07-70-C-0234 (PHILCO-FORD, WESTERN DEVELOPMENT LABORATORY CONTRACT), WHICH INCLUDE DRAWINGS, INSTRUCTION BOOKS, REPAIR PARTS SELECTION LISTS, PROVISIONING REQUIREMENTS, ETC.

UNDER THE PROVISIONS OF 10 U.S.C. 2304(A)(10) PURCHASES AND CONTRACTS MAY BE NEGOTIATED IF IT IS IMPRACTICABLE TO OBTAIN COMPETITION. IMPLEMENTING THAT AUTHORITY, ARMED SERVICES PROCUREMENT REGULATION 3 210.2 SETS FORTH ILLUSTRATIVE CIRCUMSTANCES UNDER WHICH THE AUTHORITY TO NEGOTIATE MAY BE USED. UNDER SUBPARAGRAPH (I) CONTRACTS MAY BE NEGOTIATED WHERE THE SUPPLIES CAN BE OBTAINED FROM ONLY ONE PERSON OR FIRM (SOLE SOURCE OF SUPPLY). IN OUR JUDGMENT, THE REPORTED FACTS OF RECORD ESTABLISH THAT ADEQUATE SPECIFICATIONS WERE NOT AVAILABLE TO PERMIT COMPETING THE PROCUREMENT FOR DELIVERY WITHIN THE REQUIRED SCHEDULE. WE FIND NOTHING IN THE RECORD TO SUPPORT A CONCLUSION THAT THE DETERMINATION TO NEGOTIATE ON A SOLE-SOURCE BASIS WAS ARBITRARY OR UNWARRANTED UNDER THE CIRCUMSTANCES.

ACCORDINGLY, YOUR PROTEST IS DENIED.