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B-176412, OCT 10, 1972

B-176412 Oct 10, 1972
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SINCE ASPR 1-706.5 PROVIDES FOR SMALL BUSINESS SET-ASIDES WHERE THERE IS A REASONABLE EXPECTATION OF ADEQUATE COMPETITION AND SIX FIRMS ACTUALLY SUBMITTED OFFERS. IT CANNOT BE CONCLUDED THAT THERE WAS AN ABUSE OF ADMINISTRATIVE DISCRETION IN THIS MATTER. THERE IS NO BASIS FOR CHALLENGING THE DETERMINATION TO FOREGO THE USE OF THE TWO-STEP PROCEDURE. IS FOR 51 TYPE A/S32P-10 FIRE TRUCKS AND PROVIDES FOR ALTERNATE OFFERS FOR A TOTAL OF 151 TRUCKS ON A MULTI-YEAR BASIS. FOR 44 OF THE SUBJECT TYPE A/S32P-10 FIRE TRUCKS WAS ISSUED ON APRIL 27. YOU CONTEND THAT THE CURRENT RFP IS MORE ATTRACTIVE THAN THE SOLICITATION CANCELED IN 1970 BECAUSE OF THE ADDITION OF THE MULTI-YEAR FEATURE AND THAT IT IS INEQUITABLE TO EXCLUDE LARGE BUSINESS FIRMS.

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B-176412, OCT 10, 1972

BID PROTEST - USE OF SMALL BUSINESS SET-ASIDE - JUSTIFICATION DENIAL OF PROTEST BY AMERICAN AIR FILTER COMPANY, INC., AGAINST THE ISSUANCE OF AN RFP BY WARNER ROBINS AFB, GA., AS A NEGOTIATED TOTAL SMALL BUSINESS SET-ASIDE RATHER THAN AS AN UNRESTRICTED TWO-STEP FORMALLY ADVERTISED SOLICITATION. SINCE ASPR 1-706.5 PROVIDES FOR SMALL BUSINESS SET-ASIDES WHERE THERE IS A REASONABLE EXPECTATION OF ADEQUATE COMPETITION AND SIX FIRMS ACTUALLY SUBMITTED OFFERS, IT CANNOT BE CONCLUDED THAT THERE WAS AN ABUSE OF ADMINISTRATIVE DISCRETION IN THIS MATTER. ALSO, SINCE THE JUSTIFICATION FOR USING THE EARLIER TWO-STEP INVITATION NO LONGER EXISTS, THERE IS NO BASIS FOR CHALLENGING THE DETERMINATION TO FOREGO THE USE OF THE TWO-STEP PROCEDURE. ACCORDINGLY, THE PROTEST MUST BE DENIED.

TO AMERICAN AIR FILTER COMPANY, INC.:

YOUR LETTERS OF JUNE 29 AND AUGUST 28, 1972, PROTEST THE ISSUANCE OF REQUEST FOR PROPOSALS (RFP) F09603-72-R-1091 BY THE WARNER ROBINS AIR FORCE BASE, GEORGIA, AS A NEGOTIATED TOTAL SMALL BUSINESS SET-ASIDE RATHER THAN AS AN UNRESTRICTED TWO-STEP FORMALLY ADVERTISED SOLICITATION.

THE SUBJECT RFP, ISSUED JUNE 7, 1972, IS FOR 51 TYPE A/S32P-10 FIRE TRUCKS AND PROVIDES FOR ALTERNATE OFFERS FOR A TOTAL OF 151 TRUCKS ON A MULTI-YEAR BASIS. TWO-STEP INVITATION FOR BIDS F09603-70-B-1894, FOR 44 OF THE SUBJECT TYPE A/S32P-10 FIRE TRUCKS WAS ISSUED ON APRIL 27, 1970, ON AN UNRESTRICTED BASIS AND CANCELED BECAUSE OF LACK OF FUNDS, ON SEPTEMBER 16, 1970, FOLLOWING FIRST-STEP TECHNICAL QUALIFICATION AND THE OPENING OF BIDS UNDER THE SECOND STEP. YOU CONTEND THAT THE CURRENT RFP IS MORE ATTRACTIVE THAN THE SOLICITATION CANCELED IN 1970 BECAUSE OF THE ADDITION OF THE MULTI-YEAR FEATURE AND THAT IT IS INEQUITABLE TO EXCLUDE LARGE BUSINESS FIRMS, SUCH AS AMERICAN AIR FILTER, FROM THE CURRENT COMPETITION FOLLOWING SUBMISSION BY THOSE FIRMS OF TECHNICAL PROPOSALS WITH ATTENDANT EXPENSE AND THE DISCLOSURE OF BID PRICES UNDER THE TWO-STEP INVITATION. IN THIS REGARD, YOU POINT OUT THAT AMERICAN AIR FILTER WAS LOW BIDDER UNDER THE CANCELED INVITATION.

FURTHER, YOU POINT OUT THAT PARAGRAPH 2-501, ET SEQ., OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) PROVIDES SPECIFIC GUIDELINES FOR DETERMINING WHEN THE TWO-STEP METHOD OF PROCUREMENT AS OPPOSED TO NEGOTIATION SHOULD BE USED AND YOU MAINTAIN THAT SINCE THERE HAS BEEN NO SIGNIFICANT CHANGE IN SPECIFICATIONS FOR THE FIRE TRUCKS HERE INVOLVED AS BETWEEN THE CANCELED TWO-STEP INVITATION AND THE CURRENT RFP, NO BASIS EXISTED FOR ANY CHANGE IN THE PROCUREMENT METHOD UTILIZED. FINALLY, YOU EXPRESS THE FEAR THAT PROPRIETARY DATA OBTAINED FROM BIDDERS UNDER THE FIRST STEP OF THE CANCELED INVITATION WILL BE DIVULGED BY THE GOVERNMENT IN THE CURRENT PROCUREMENT.

THE REPORT FURNISHED OUR OFFICE BY THE DEPARTMENT OF THE AIR FORCE, A COPY OF WHICH HAS BEEN FURNISHED TO YOU PREVIOUSLY, POINTS OUT THAT IN MAKING THE DETERMINATION TO SET THE INSTANT PROCUREMENT TOTALLY ASIDE FOR SMALL BUSINESS PARTICIPATION, CONSIDERATION WAS GIVEN TO BIDDING COSTS INCURRED BY BOTH SMALL AND LARGE BUSINESS BIDDERS UNDER THE TWO STEP PROCEDURE. HOWEVER, IN VIEW OF AN ESTIMATED 25-PERCENT INCREASE IN THE COST OF THE SUBJECT TRUCKS IN THE TIME SINCE CANCELLATION OF THE INVITATION, IT WAS CONCLUDED THAT "EXPOSURE OF THESE PRICES DOES NOT COMPROMISE THE INTEGRITY OF THE PROCUREMENT PROCESS." THE REPORT FURTHER JUSTIFIES THE SET-ASIDE BY CITING ASPR 1-706.5 WHICH PROVIDES FOR TOTAL SMALL BUSINESS SET-ASIDES WHERE "THERE IS REASONABLE EXPECTATION THAT BIDS OR PROPOSALS WILL BE OBTAINED FROM A SUFFICIENT NUMBER OF RESPONSIBLE SMALL BUSINESS CONCERNS SO THAT AWARD WILL BE MADE AT REASONABLE PRICES" AND BY CITING DECISIONS OF OUR OFFICE TO THE EFFECT THAT SET-ASIDE DETERMINATIONS ARE PROPERLY RESERVED TO ADMINISTRATIVE DISCRETION AND WILL BE CHALLENGED BY OUR OFFICE ONLY WHERE A CLEAR SHOWING OF ABUSE OF DISCRETION IS MADE. IN VIEW OF THE FACT THAT A SOURCE LIST OF 33 PROSPECTIVE QUALIFIED SMALL BUSINESS SOURCES WAS PREPARED AND THAT OFFERS WERE ACTUALLY RECEIVED FROM SIX SMALL BUSINESS OFFERORS, THE REPORT CONCLUDES THAT THERE WAS NO ABUSE OF DISCRETION IN THIS INSTANCE. AGREE WITH THIS RATIONALE AND CONCLUDE THAT NO BASIS EXISTS FOR CHALLENGING THE SET-ASIDE DETERMINATION.

ON THE QUESTION OF THE PROPRIETY OF THE CHANGE IN PROCUREMENT METHOD FROM TWO-STEP TO NEGOTIATED, THE REPORT STATES THAT IN THE INTERVENING TIME SINCE CANCELLATION OF THE TWO-STEP INVITATION, ACCEPTABLE VEHICLES HAVE BEEN PRODUCED, TESTED AND DELIVERED UNDER OTHER CONTRACTS THEREBY ASSURING THAT THE SPECIFICATION, ALTHOUGH ADMITTEDLY NOT CHANGED IN ANY SIGNIFICANT RESPECT, IS "COMPLETE, ACCURATE, RELIABLE, AND ADEQUATELY DESCRIBES THE GOVERNMENT'S REQUIREMENT." FURTHER, THE REPORT STATES THAT THE MINOR SPECIFICATION CHANGES WHICH HAVE BEEN MADE IN THE INTERIM TIME HAVE THE EFFECT OF RELAXING PROVISIONS REQUIRING "BRAND NAME OR EQUAL" ACCESSORIES AND COMPONENTS. INASMUCH AS THE JUSTIFICATION FOR THE TWO-STEP INVITATION WAS THAT TESTING AND EVALUATION UNDER AN EARLIER "IN BAILMENT" AGREEMENT HAD NOT AT THAT TIME BEEN COMPLETED, NO BASIS EXISTS FOR CHALLENGING THE DETERMINATION TO FOREGO THE USE OF THE TWO-STEP PROCEDURE. SEE, IN THIS REGARD, ASPR 2-502. ALSO, ASPR 3-201.2 PROVIDES FOR THE NEGOTIATION OF SMALL BUSINESS SET-ASIDE CONTRACTS UNDER THE NATIONAL EMERGENCY EXCEPTION.

FINALLY, ON THE QUESTION OF POSSIBLE DIVULGENCE OF PROPRIETARY DATA FURNISHED BY BIDDERS UNDER THE FIRST STEP OF THE CANCELED TWO-STEP INVITATION, THE REPORT STATES THAT THE MILITARY SPECIFICATION USED IN THE INSTANT RFP (MIL-T-83965) AND THE SPECIFICATION REQUIREMENTS ON WHICH THE PURCHASE DESCRIPTION FOR THE TWO-STEP INVITATION WAS BASED DIFFER FROM EACH OTHER ONLY IN MINOR DETAILS WHICH "ARE ATTRIBUTABLE AND TRACEABLE TO REVIEW, TEST AND EVALUATION OF VEHICLES DURING THE TIME SPAN OF THE DEVELOPMENT OF THE CURRENT CONFIGURATION OF THE VEHICLE," NOT TO THE USE OF ANY DATA PROPRIETARY TO BIDDERS UNDER THE TWO-STEP PROCUREMENT. MUST ACCEPT THIS EXPLANATION OF THE GENESIS OF THE CURRENT SPECIFICATION IN THE ABSENCE OF ANY MORE CONCRETE ALLEGATION THAN THE UNSUBSTANTIATED CONTENTION RAISED IN YOUR JUNE 29 LETTER AS TO THE AIR FORCE'S INTENT WITH REGARD TO DISCLOSURE OF PROPRIETARY INFORMATION.

IN ACCORDANCE WITH THE ABOVE CONSIDERATIONS, YOUR PROTEST MUST BE DENIED.

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