B-152261, SEP. 12, 1963, 43 COMP. GEN. 255

B-152261, SEP. 12, 1963, 43 COMP. GEN. 255

BIDS - COMPETITIVE SYSTEM - TWO-STEP PROCUREMENT - FIRST STAGE DETERMINATIONS AN AWARD UNDER THE SECOND PART OF A TWO-STEP PROCUREMENT TO A BIDDER WHO, ALTHOUGH NOT ISSUED AN INVITATION TO BID, THE TECHNICAL PROPOSAL UNDER THE FIRST STEP OF THE PROCUREMENT HAVING BEEN CONSIDERED UNSATISFACTORY AND NOT SUSCEPTIBLE OF BEING MADE ACCEPTABLE, AND PARAGRAPH 2-503.2 OF THE ARMED SERVICES PROCUREMENT REGULATION REQUIRING ACCEPTABILITY OF THE TECHNICAL PROPOSAL FOR ELIGIBILITY TO BID, UPON INFORMAL ADVICE OF THE UNACCEPTABILITY OF THE FIRST-STEP PROPOSAL CORRECTED THE DEFICIENCIES WITH 3 DAYS AND SUBMITTED AN ACCEPTABLE REVISED PROPOSAL PRIOR TO OPENING OF BIDS WOULD BE A VALID AWARD, EVEN THOUGH ORDINARILY REVISED PROPOSALS RECEIVED AFTER DATE SET FOR SUBMISSION ARE NOT CONSIDERED, THE SPEED WITH WHICH THE BIDDER REVISED THE TECHNICAL PROPOSAL DEMONSTRATING ABILITY TO HAVE MET THE DEADLINE SUBMISSION DATE FOR REVISION OF PROPOSALS REASONABLY SUSCEPTIBLE OF BEING MADE ACCEPTABLE HAD NOTICE BEEN FURNISHED IN ACCORDANCE WITH PARAGRAPH 2-503.1 (B) (VI) OF THE UNACCEPTABILITY OF THE FIRST-STEP PROPOSAL AND BASIS FOR THE DETERMINATION.

TO THE SECRETARY OF THE NAVY, SEPTEMBER 12, 1963:

WE HAVE A LETTER OF AUGUST 9, 1963, WITH ENCLOSURES, REFERENCE R1.2, SIGNED BY THE ACTING ASSISTANT CHIEF FOR PURCHASING, BUREAU OF SUPPLIES AND ACCOUNTS, REQUESTING OUR DECISION ON THE VALIDITY OF A PROPOSED AWARD TO THE SUN ELECTRIC COMPANY UNDER INVITATION FOR BIDS NO. IFB-62269-10-63 ISSUED JUNE 17, 1963 BY THE NAVAL AIR DEVELOPMENT CENTER AS THE SECOND PART OF A TWO-STEP PROCUREMENT FOR THE PURCHASE OF MOBILE LOAD BANKS, ELECTRICAL POWER PLANT TEST SETS.

THE FIRST STEP OF THE PROCUREMENT RESULTED IN THE ISSUANCE ON MAY 9, 1963 OF RFP NO. 146Q SOLICITING TECHNICAL PROPOSALS FOR THE ITEM TO BE PROCURED. UNDER THE TERMS OF THE RFP, TECHNICAL PROPOSALS WERE TO BE SUBMITTED BY THE CLOSE OF BUSINESS ON MAY 31, 1963. INTERESTED PARTIES WERE WARNED THAT THE INVITATION FOR BID UNDER THE SECOND STEP WOULD BE ISSUED ONLY TO THOSE SOURCES WHOSE TECHNICAL PROPOSALS SUBMITTED IN THE FIRST STEP WERE DETERMINED TO BE ACCEPTABLE.

SIX TECHNICAL PROPOSALS WERE RECEIVED. AFTER EVALUATION THREE, INCLUDING THAT SUBMITTED BY THE SUN ELECTRIC CORPORATION, WERE CONSIDERED TECHNICALLY UNSATISFACTORY AND NOT REASONABLY SUSCEPTIBLE OF BEING MADE ACCEPTABLE. THE OTHER THREE PROPOSALS, INCLUDING ONE FROM AVTRON MANUFACTURING, INC., WERE REGARDED AS REASONABLY SUSCEPTIBLE OF ACCEPTANCE PROVIDING CERTAIN CHANGES IN DESIGN WERE MADE AND CERTAIN QUESTIONABLE DESIGN ITEMS WERE CONFIRMED. THE THREE FIRMS IN THIS LATTER CATEGORY WERE CONTACTED ON JUNE 6, 1963, ADVISED OF THE DEFICIENCIES IN THEIR TECHNICAL PROPOSALS AND THE NECESSARY CORRECTIONS AND TOLD THAT THE CHANGES AND CONFIRMATION WOULD HAVE TO BE RECEIVED NOT LATER THAN JUNE 10, 1963. EACH COMPLIED WITHIN THE TIME SET AND QUALIFIED TECHNICALLY. ON JUNE 17, 1963, THE INVITATION WAS ISSUED TO THESE THREE FIRMS AS THE SECOND STEP OF THE TWO-STEP FORMAL ADVERTISING PROCEDURE.

THE OTHER THREE FIRMS WERE ADVISED BY LETTERS OF JUNE 21, 1963, THAT THEIR TECHNICAL PROPOSALS WERE NOT ACCEPTABLE AND THAT THEY WOULD NOT BE ASKED TO BID ON THE SECOND STEP. ON THE SAME DATE, JUNE 21, 1963, A REPRESENTATIVE OF SUN ELECTRIC VISITED THE AIR DEVELOPMENT CENTER AND WAS ADVISED THAT THIS COMPANY WOULD NOT BE ASKED TO BID AND THE REASONS THEREFOR. PRESUMABLY AS OF A RESULT OF THE CONVERSATION, SUN ELECTRIC SUBMITTED AN AMENDMENT TO ITS ORIGINAL TECHNICAL PROPOSAL ON JUNE 24. TECHNICAL REVIEW RESULTED IN THE CONCLUSIONS THAT THE DEFICIENCIES NOTED EARLIER HAD BEEN CORRECTED AND THE SUN PROPOSAL AS AMENDED WAS TECHNICALLY ACCEPTABLE. SUN WAS THEN GIVEN A COPY OF THE INVITATION.

BIDS WERE OPENED AS SCHEDULED ON JUNE 25, 1963. THE LOW BID WAS RECEIVED FROM SUN ELECTRIC, THE SECOND LOW BID FROM AVTRON. AVTRON HAS PROTESTED CONSIDERATION OF THE SUN BID ON THE BASIS THAT UNDER THE TERMS OF THE RFP AND OF PAR. 2-503.2, ARMED SERVICES PROCUREMENT REGULATION, ONLY THOSE FIRMS WHOSE TECHNICAL PROPOSALS WERE EVALUATED AND DETERMINED TO BE ACCEPTABLE UNDER THE FIRST STEP WERE ELIGIBLE TO SUBMIT A BID.

WITH RESPECT TO THE PROPRIETY OF AN AWARD TO SUN THE CONTRACTING OFFICER STATES:

WHILE THE SUN ELECTRIC COMPANY'S TECHNICAL PROPOSAL WAS DEFICIENT AS ORIGINALLY SUBMITTED, THE COMPANY, WITHIN THREE DAYS AFTER BEING ADVISED THAT THEIR TECHNICAL PROPOSAL WAS NOT BEING CONSIDERED, SUBMITTED A REVISED TECHNICAL PROPOSAL THAT WAS ACCEPTABLE. THE CONTRACTING OFFICER IS OF THE OPINION THAT HAD SUN ELECTRIC BEEN ADVISED OF THE REJECTION OF THEIR TECHNICAL PROPOSAL PRIOR TO THE ISSUANCE OF THE STEP 2 INVITATION FOR BIDS, SUN ELECTRIC WOULD HAVE IMMEDIATELY REQUESTED THE CONTRACTING OFFICER TO RECONSIDER THE REJECTION OF SUN'S PROPOSAL AND IS FURTHER OF THE OPINION THAT THE CONTRACTING OFFICER WOULD HAVE APPROVED THE SUBMISSION OF A REVISED PROPOSAL. THE CONTRACTING OFFICER FEELS SUCH APPROVAL WOULD HAVE BEEN GRANTED BECAUSE OF SUN'S PRIOR EXPERIENCE IN THE MANUFACTURE OF LOAD BANKS AND BECAUSE IT IS APPARENT FROM THE SPEED WITH WHICH SUN HAS SUBMITTED AN ACCEPTABLE PROPOSAL THAT THE TECHNICAL PROPOSAL AS ORIGINALLY SUBMITTED WAS REASONABLY SUSCEPTIBLE OF BEING ACCEPTABLE (AS PROVIDED IN ASPR 2-503.1 (B) (V) ).

WE HAVE HELD THAT IN TWO-STEP PROCUREMENTS IT IS PROPER TO REFUSE AFTER THE DATE SET FOR SUBMISSION TO CONSIDER REVISIONS TO TECHNICAL PROPOSALS CONSIDERED UNACCEPTABLE. SEE 40 COMP. GEN. 40; ID. 35; B 148407, MAY 3, 1962. WE DO NOT BELIEVE THAT UNDER ORDINARY CIRCUMSTANCES THE POSITION STATED IN THE CITED DECISIONS SHOULD BE REGARDED AS GIVING THE CONTRACTING AGENCY AN OPTION TO DETERMINE WHETHER IN A GIVEN CASE FURTHER NEGOTIATIONS WILL BE HELD ON UNACCEPTABLE PROPOSALS. TO RECOGNIZE SUCH OPTION, EXCEPT TO THE EXTENT PERMITTED UNDER ASPR 2-503.1 (C), WOULD LEAVE CONTRACTING OFFICERS OPEN TO ALLEGATIONS OF UNEQUAL TREATMENT OF BIDDERS. IN THIS INSTANCE, HOWEVER, WE NOTE THAT THE AMENDMENT RECEIVED FROM SUN ON JUNE 24 COVERED APPROXIMATELY A PAGE AND A HALF, INCLUDING ADDRESS, SALUTATION, INTRODUCTORY MATERIAL, CLOSING AND SIGNATURE. WE NOTE ALSO THE CONTRACTING OFFICER'S POSITION THAT THE SUN PROPOSAL COULD PROPERLY HAVE BEEN PLACED--- SUBJECT TO CLARIFICATION AND DESIGN CHANGE AS WERE THE OTHER THREE--- IN THE ACCEPTABLE CATEGORY INITIALLY.

ASPR 2-503.1 (B) (VI) REQUIRES PROMPT NOTIFICATION TO FIRMS WHOSE TECHNICAL PROPOSALS ARE DETERMINED TO BE IN THE UNACCEPTABLE CATEGORY INCLUDING A GENERAL STATEMENT OF THE BASIS FOR SUCH DETERMINATION. WE CAN NOT SAY THE REQUIREMENT FOR PROMPT NOTIFICATION WAS MET IN THIS INSTANCE SINCE PRESUMABLY THE DETERMINATION WAS MADE PRIOR TO JUNE 6 WHILE FIRMS SUBMITTING UNACCEPTABLE TECHNICAL PROPOSALS WERE ADVISED ONLY BY LETTER OF JUNE 21. ON THE BASIS OF THE SPEED WITH WHICH SUN AMENDED ITS TECHNICAL PROPOSALS TO AN ACCEPTABLE FORM IT SEEMS REASONABLE TO CONCLUDE THAT, GIVEN NOTICE ON JUNE 6, SUN WOULD HAVE BEEN ABLE TO SUBMIT AN ACCEPTABLE PROPOSAL BY THE DEADLINE DATE OF JUNE 10 AND THE BASIS FOR AVTRON'S PROTEST WOULD NOT HAVE APPLIED.

UNDER NORMAL CIRCUMSTANCES WE WOULD BE OF THE VIEW THAT THE SUN BID COULD NOT BE CONSIDERED FOR FAILURE TO CONFORM TO THE CITED LANGUAGE OF THE RFP AND ASPR. TO HOLD OTHERWISE WOULD MEAN THAT A FIRM SUBMITTING AN UNACCEPTABLE TECHNICAL PROPOSAL WOULD BE GIVEN AN ADDITIONAL PERIOD TO RENDER IT ACCEPTABLE BEYOND THAT ALLOWED FIRMS WHOSE TECHNICAL PROPOSALS WERE INITIALLY PLACED IN THE ACCEPTABLE CATEGORY. IN THIS CASE, HOWEVER, SINCE SUN HAD IN FACT EVEN LESS TIME TO AMEND ITS TECHNICAL PROPOSAL THAN WAS GIVEN TO THE THREE FIRMS IN THE ACCEPTABLE CATEGORY, AND SINCE APPARENTLY IT IS REASONABLE TO CONCLUDE THAT SUN WAS INCORRECTLY PLACED IN THE UNACCEPTABLE CATEGORY ORIGINALLY, AND SINCE THE SITUATION AROSE IN MATERIAL PART BECAUSE OF THE FAILURE TO GIVE SUN THE PROMPT NOTIFICATION REQUIRED BY REGULATION, WE WILL NOT IN THIS INSTANCE OBJECT TO AWARD TO THE LOW BIDDER.

THE PAPERS WHICH YOU REQUESTED BE RETURNED IN THE LETTER OF AUGUST 9 ARE ENCLOSED.