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A firm protested an Air Force sole-source contract award for chaff, contending that the Air Force improperly: (1) failed to maximize competition, since it did not solicit a bid from the protester, a known source; and (2) determined that its requirements were urgent. GAO held that the Air Force reasonably determined that only the awardee could meet its requirements, since: (1) it properly considered potential delivery delays; (2) the protester was not a qualified source; and (3) the Air Force properly based its urgent requirements on an unusual and compelling military operation. Accordingly, the protest was denied.

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B-243067, Jun 27, 1991, 70 Comp.Gen. 588

PROCUREMENT - Noncompetitive Negotiation - Use - Justification - Urgent needs Sole-source award for chaff under 10 U.S.C. Sec. 2304(c)(2) (1988) was unobjectionable where based on urgent wartime requirement and agency's reasonable determination that only one source was available that had proven acceptable chaff, since testing necessary for other potential sources, including protester, would cause unacceptable delay in procurement.


Lundy Technical Center, Inc.:

Lundy Technical Center, Inc. protests the sole-source award of a contract by the Air Force to Tracor Aerospace, Inc., pursuant to emergency purchase request No. FD2060-91-30260, for 9,000 boxes of RR ZZZ chaff, used by B-52 aircraft to deceive, screen, and confuse enemy radar. Lundy contends that it is fully capable of furnishing the chaff, and that the sole-source award therefore is improper under the Competition in Contracting Act of 1984 (CICA), 10 U.S.C. Sec. 2301 et seq., (1988 and Supp. I 1989).

We deny the protest.

This sole-source contract resulted from "Operation Desert Shield" in the Middle East, after the Iraqi military forces invaded Kuwait on August 2, 1990. In response to this action, the United States dispatched military personnel, including Air Force crew, to assist in defending Saudi Arabia against Iraqi incursion. In connection with this effort, the Air Force awarded a sole-source contract to Tracor for RR-ZZZ chaff on August 31; the initial contract requirement for 750 boxes subsequently was modified on November 28 to add another 750 boxes. On January 16, 1991, the United States, along with other allied powers, began a full scale military campaign against Iraq. In support of this campaign, the Air Force determined it was necessary to expeditiously procure 9,000 boxes of RR-ZZZ chaff, the amount needed to support 1,200 sorties (40 B-52 aircraft flying one sortie each for 30 days).

Before the inception of Operation Desert Shield in August, the agency had never procured RR-ZZZ chaff. The Air Force had, however, previously procured from Tracor RR-149A chaff, which reportedly is very similar to RR -ZZZ chaff. Since only Tracor had produced RR-149A chaff that had been tested and procured by the Air Force, the agency determined that only Tracor was capable of expeditiously supplying the RR-ZZZ chaff. The Air Force therefore prepared and approved a Justification and Approval (J&A), dated January 18, for procurement of the chaff on a sole-source basis, citing the authority of 10 U.S.C. Sec. 2304(c)(2) (1988), as implemented by Federal Acquisition Regulation (FAR) Sec. 6.302-2, which allows for limited competition where the agency's need for the property or services is of such an unusual and compelling urgency that the United States otherwise would be seriously injured. The J&A and supporting documentation listed Tracor as the only source capable of providing the RR -ZZZ chaff on an urgent basis, and explained that the urgency of the requirement made it infeasible to seek or solicit additional sources; competing the requirement would cause a delay in delivery, which would result in further risk to B-52 aircraft and crew. The Air Force awarded the sole source contract to Tracor on February 14 for 9,000 boxes of RR- ZZZ chaff, to be delivered in weekly increments over a period of 18 months, commencing February 22, 1991, and ending in September 1992. Lundy thereupon filed this protest with our Office. /1/

Lundy argues that the agency failed to maximize competition as required by CICA by not soliciting for the RR-ZZZ chaff from Lundy, a known source of chaff. Although Lundy does not dispute that there was an urgent need for RR-ZZZ chaff resulting from Operation Desert Shield, it argues that this did not justify the agency's decision to limit the noncompetitive award to Tracor because, according to Lundy, it could have qualified as a source for the RR-ZZZ chaff within 100 to 200 days. Lundy also contends that the Air Force no longer has a foreseeable need for 9,000 boxes of chaff to be delivered over 18 months because a cease-fire has been in effect in the Persian Gulf since March 7; Lundy argues that there is no urgent need for this amount of chaff, and that the agency is not justified in procuring all of the chaff on a sole-source basis.

Where an agency's requirements are of unusual and compelling urgency, the agency may limit a procurement to one firm if it reason ably determines only that firm can properly perform the work in the available time. U.S.C. Sec. 2304(c)(2); Rex Sys., Inc., B-239524, Sept. 5, 1990, 90-2 CPD Sec. 185. A military agency's assertion that there is a critical need for certain supplies, which impacts military operations, carries considerable weight. Greenbrier Indus., Inc., B-241304, Jan. 30, 1991, 91-1 CPD Para. 92. We will review the agency's determination to limit competition on the basis of such urgent circumstances to ascertain whether it was reasonable. Gentex Corp., B-233119, Feb. 13, 1989, 89-1 CPD Para. 144.

We find that the Air Force reasonably determined that urgent and compelling circumstances arising out of Operation Desert Shield required the noncompetitive procurement of RR-ZZZ chaff here. The record establishes that at the time the sole-source award was made, the agency anticipated a protracted engagement in the Persian Gulf and therefore needed chaff to meet its current and future operational needs for the war against Iraq. The Air Force thus reasonably concluded that an urgent and compelling need existed for the expeditious procurement of RR-ZZZ chaff to safeguard B-52 aircraft and crew.

Although the deliveries of the chaff were scheduled over an 18-month period, the record indicates that this delivery schedule reflected both the agency's projection that hostilities in the Middle East could continue for that length of time and its determination that competition would not be available for the requirement for that 18-month period. We have no basis for questioning the projected time frame for conclusion of the military operations in the Middle East; this was a matter entirely within the purview of the Air Force.

We also find no basis to object to the Air Force's calculation that it would take 18 months or more for another chaff source to become available.

The Air Force's calculations are based on two 1987 contracts with Tracor for a different version of chaff, under which it initially estimated that Tracor could commence delivery in 175 and 295 days, respectively. Tracor in fact took 302 days to pass first article testing under the first contract and 419 days under the second contract. The agency explains it determined that qualification of Lundy for the RR-ZZZ chaff would take even longer than it took to qualify Tracor, because Tracor's previous contracts did not require flight testing; the Air Force estimates that an additional 180 days could be necessary for flight testing Lundy's chaff, and then only if the required airplanes were available. The Air Force states in this regard that, in fact, prompt flight testing of Lundy's chaff would be "virtually impossible" because a majority of the B-52 force has been deployed for use in the Middle East conflict. The Air Force concluded that, under this scenario, it would take Lundy a total of approximately 18 months to qualify as a source for, and commence production of, RR ZZZ chaff, and that it thus was appropriate to purchase its entire 9,000 box requirement from Tracor over an 18-month period.

Lundy challenges the Air Force's reliance on the agency's experience under prior contracts with Tracor for differenct chaff as support for its estimate of the amount of time, apart from flight testing, it would take to qualify Lundy; Lundy argues that there is no valid reason to assume that its own performance under a contract for RR-ZZZ chaff would be similarly deficient. We would agree with Lundy that there is was no valid reason for the agency to assume that delays attributable to Tracor under its prior contracts also would be experienced in a contract with Lundy. However, the record shows that the delays under Tracor's contracts were caused, not by any deficiency in Tracor's performance, but by deficiencies in the specification. The Air Force reports that the RR-ZZZ specification also contains deficiencies that would present the possibility of unforeseen delays in testing Lundy's chaff. We see nothing improper in the agency's taking these potential delays into account in considering when competition would be available, and thus how much chaff should be purchased on a noncompetitive basis.

Lundy also questions the necessity for flight testing as a prerequisite to qualification of a new source for the RR-ZZZ chaff and, thus, the 180 days the agency included in its 18-month calculation for flight testing. Lundy points out that flight testing was not required under Tracor's prior contracts for RR-ZZZ chaff, or under Tracor's 1987 contracts First, there is no circumstance under which the Air Force would be required to forego flight testing of an item such as chaff, used in wartime to ensure airplane and crew safety, in order to increase competition. See generally Imperial Schrade Corp., 66 Comp.Gen. 307 (1987), 87-1 CPD Para. 254 (agency is not required to buy an unsafe bayonet system at any price). any case, we see nothing arbitrary in the agency's position that flight testing would be required. The agency reports that flight testing was waived on the previous RR-ZZZ chaff awards because of problems encountered in scheduling such testing, and because the need for the items in support of Middle East military operations had become critical.

In waiving testing in these instances, the agency also considered that the RR-ZZZ chaff resulted from a modification of the specification for the reportedly very similar RR-149A chaff, which Tracor previously had successfully produced. We find nothing unreasonable or unfair in the agency's determination that, due to the differences in Tracor's and Lundy's circumstances, flight testing would be necessary for Lundy, which has manufactured neither the RR-149A nor the RR-ZZZ chaff, even though it was waived for Tracor.

We conclude that the agency properly determined that the Desert Shield military operations gave rise to an unusual and compelling urgency for RR- ZZZ chaff, and that no competition likely would be available for the requirement for the 18-month period during which delivery was scheduled. Under these circumstances, the award of a sole source contract to Tracor was unobjectionable

The protest is denied.

/1/ Lundy questions the Air Force's failure to suspend performance under Tracor's contract pending our decision. However, suspension of performance was not required here because notification to the Air Force of the protest, although provided by our Office within 1 working day of the filing of the protest, as specified under CICA, 31 U.S.C. Sec. 3553(b)(1) (1988), was received by the agency beyond 10 calendar days after award; CICA requires suspension of performance only where the agency is notified of a protest to our Office within 10 calendar days after award. 31 U.S.C. Sec. 3553(d)(1).

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