The Military Services Sole-Source Procurement of C-12 Aircraft

NSIAD-85-80: Published: May 15, 1985. Publicly Released: Jun 24, 1985.

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In response to a congressional request, GAO reviewed the acquisition strategy for C-12 aircraft, which have been procured on a sole-source basis.

GAO found that the Army, in making the sole-source procurements, has complied with recurring congressional guidance to acquire a single, common-utility, transport aircraft. After a competitive solicitation was cancelled when only one bidder submitted a proposal, a sole-source contract was negotiated with the offerer. In response to a bid protest, GAO found that the cancellation and sole-source award were in accordance with procurement regulations, and GAO review of subsequent solicitations found no violations of procurement regulations. However, GAO found that some of the guidelines which Congress set for standardized and consolidated purchases of the aircraft were contrary to the requirements of the Competition in Contracting Act. Furthermore, GAO found that a cost-benefit analysis had not been performed since the initial sole-source award; therefore, the continued use of standardization to justify sole-source procurements was not adequately supported. In addition, GAO found that adequate contractor logistics support could be achieved through a consolidated competitive procurement that included full contractor-provided maintenance and logistics support. Finally, GAO found: (1) indications of potential price savings which could result from competition; and (2) that changes in performance requirements and the aircraft raised questions regarding standardization as a basis for continued sole-source procurements.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: A study on the need for C-12 type aircraft was completed. An accomplishment report for $4.7 million other measurable savings was submitted.

    Recommendation: The Secretary of Defense, after validating future requirements for C-12 type aircraft, should direct that future procurements be competed unless it can be clearly shown that continuing the present sole-source acquisition strategy is warranted under the provisions of the 1984 Competition in Contracting Act.

    Agency Affected: Department of Defense


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