B-175728, OCT 31, 1972

B-175728, OCT 31, 1972

BID PROTEST - COMPLIANCE WITH SPECIFICATIONS DECISION DENYING THE PROTEST OF ALL-TRONICS, INC., AGAINST AWARD OF A CONTRACT TO R.F. INTERONICS UNDER A RFP ISSUED BY THE U.S. ARMY ENGINEERS DIVISION, HUNTSVILLE, ALA., FOR RADIO FREQUENCY INTERFERENCE FILTER ASSEMBLIES. THE PRIMARY RESPONSIBILITY FOR DETERMINING THE NEEDS OF THE GOVERNMENT AND FOR DRAFTING SPECIFICATIONS REFLECTING THOSE NEEDS, AS WELL AS THE FACTUAL DETERMINATION OF COMPLIANCE WITH THOSE SPECIFICATIONS, RESTS WITH THE PROCURING ACTIVITY AND WILL NOT BE QUESTIONED UNLESS CLEARLY ARBITRARY, CAPRICIOUS, OR LACKING A FACTUAL BASIS, 49 COMP. GEN. 857, 862 (1970). THE CONTRACTING OFFICER'S ACTIONS IN THIS CASE WERE REASONABLE IN THE CONTEXT OF THE THEN EXISTING SITUATION.

TO ALL-TRONICS, INCORPORATED:

REFERENCE IS MADE TO YOUR LETTER AND TELEGRAM OF APRIL 18, 1972, PROTESTING AGAINST THE AWARD OF A CONTRACT TO ANOTHER FIRM FOR THE PROCUREMENT OF RADIO FREQUENCY INTERFERENCE (RFI) FILTER ASSEMBLIES UNDER REQUEST FOR PROPOSALS NO. DACA87-72-R-0161, ISSUED BY THE UNITED STATES ARMY ENGINEERS DIVISION, HUNTSVILLE, ALABAMA.

AS BACKGROUND, THE ARMY REPORTS THAT THE ITEMS BEING PROCURED HERE ARE TO BE FURNISHED TO THE SAFEGUARD BALLISTIC MISSILE DEFENSE SYSTEM CONSTRUCTION CONTRACTOR BY CERTAIN DATES FOR INSTALLATION AS GOVERNMENT FURNISHED PROPERTY. FURTHERMORE, IT IS REPORTED THAT THE NEED FOR THESE ITEMS IS CRITICAL BECAUSE THE PRIOR CONTRACTOR, FILTRON COMPANY, INCORPORATED, DEFAULTED IN PERFORMANCE OF ITS MULTIYEAR CONTRACT AFTER DELIVERING ONLY ONE YEAR'S REQUIREMENT. THEREFORE, THE CONTRACT WAS NEGOTIATED PURSUANT TO 10 U.S.C. 2304(A)(2) WHICH AUTHORIZES NEGOTIATION WHEN THE PUBLIC EXIGENCY WILL NOT PERMIT THE DELAY INCIDENT TO FORMAL ADVERTISING. THE RFP WAS ISSUED ON MARCH 10, 1972, WITH A CLOSING DATE OF MARCH 24, AND OF THE FOUR PROPOSALS RECEIVED BY THAT DATE YOURS WAS SECOND LOW.

INITIALLY, EXCEPTION WAS TAKEN TO THE DELIVERY REQUIREMENTS BY THREE OF THE OFFERORS. UPON FURTHER ANALYSIS THE CONTRACTING OFFICER DECIDED THAT THE DELIVERY DATES COULD NOT BE MET. EACH OFFEROR WAS THEN TOLD TO DISREGARD THE MANDATORY DELIVERY DATES AND LIQUIDATED DAMAGES FOR DELAY PROVISION AND IN LIEU THEREOF, TO CONSIDER A SET OF ALTERNATE DELIVERY PROVISIONS CONTAINED IN THE TELEGRAM. EACH OFFEROR WAS ALSO ASKED TO SUBMIT ITS BEST DELIVERY DATE AND PRICE. ALL-TRONICS REPLIED THAT IT COULD NOT REALISTICALLY SCHEDULE DELIVERY OF THE FIRST SET OF FILTER ENCLOSURES PRIOR TO SEPTEMBER 28, 1972, WITH COMPLETION OF DELIVERY BY NOVEMBER 2, 1972. BASED UPON THE RESPONSES OF THE OTHER OFFERORS TO THIS MESSAGE THE PROCURING ACTIVITY DEVELOPED A DELIVERY SCHEDULE THAT IT FELT COULD BE ACHIEVED. THIS SCHEDULE REQUIRED DELIVERY OF THE FILTER ENCLOSURE BY JUNE 15, 1972, AND FILTER ELEMENTS BY OCTOBER 3, 1972, FOR REMOTE LAUNCH SITES 2 AND 3, AND DELIVERY OF THE COMPLETE FILTER ASSEMBLY FOR REMOTE LAUNCH SITES 1 AND 4 BY NOVEMBER 2, 1972. EACH OFFEROR WAS NOTIFIED OF THE NEW DELIVERY SCHEDULE AND WAS ASKED TO SUBMIT HIS FINAL PROPOSAL. ALSO, THE AMENDMENT REQUIRED HAND DELIVERY OF SHOP DRAWINGS FOR APPROVAL IN ORDER TO FACILITATE THE EARLY DELIVERY REQUIREMENTS.

YOU VERIFIED YOUR EXISTING PROPOSAL PRICE BUT DID NOT MENTION THE LATEST DELIVERY DATES OR THE SHOP DRAWING REQUIREMENT. THEREFORE, YOUR REPLY WAS CONSIDERED AMBIGUOUS AND, IN ORDER TO TREAT THE OFFERORS EQUALLY, THE PROCURING ACTIVITY REQUESTED EACH OFFEROR TO VERIFY ITS PRICE AND ACCEPTANCE OF THE DELIVERY SCHEDULE SPECIFIED IN THE PROCURING ACTIVITY'S PREVIOUS TELEGRAM. YOU REPLIED THAT THE JUNE 15, 1972 DELIVERY DATE FOR ENCLOSURES FOR REMOTE LAUNCH SITES 2 AND 3 WAS UNREALISTIC UNLESS THE GOVERNMENT WAIVED THE REQUIREMENT FOR APPROVAL OF PROTOTYPES PRIOR TO THE MANUFACTURING OF THE FILTER ENCLOSURES OR, IN THE ALTERNATIVE, IF NO WAIVER COULD BE GRANTED THEN THE BEST DELIVERY WOULD BE IN ACCORDANCE WITH ALL-TRONICS' PREVIOUS DELIVERY QUOTATION, WHICH DID NOT COMPLY WITH THE REQUIRED DELIVERY DATES. WITH YOUR REQUEST FOR WAIVER OF THE TEST REQUIREMENTS, YOU STATED THAT THE ENCLOSURES YOU PROPOSED TO FURNISH WERE IDENTICAL TO THOSE MANUFACTURED BY THE FILTRON COMPANY, INCORPORATED, WHICH HAD ALREADY PASSED THE REQUIRED TESTS. IN THIS CONNECTION, YOU POINT OUT THAT UNTIL MARCH 1971 YOU WERE PRESIDENT OF FILTRON. YOU WERE THE ONLY OFFEROR TO REQUEST A WAIVER IN THE TESTING REQUIREMENTS PRIOR TO MANUFACTURING. THE REQUEST WAS DENIED. ALTHOUGH YOUR OFFER WAS LOW IT WAS DETERMINED TO BE UNACCEPTABLE FOR FAILURE TO COMPLY WITH THE DELIVERY PROVISIONS. DUE TO THE URGENCY, AWARD WAS MADE ON APRIL 14, 1972, TO R F INTERONICS WHICH PROPOSED TO MEET THE DELIVERY DATES AND ALL OTHER REQUIREMENTS.

BASICALLY, IT IS YOUR POSITION THAT COMPLIANCE WITH THE REQUIREMENTS FOR SUBMITTAL AND APPROVAL OF DRAWINGS, MANUFACTURING OF TEST SAMPLES, AND COMPLETE TESTING AND APPROVAL OF TEST SAMPLES PRIOR TO MANUFACTURING OF PRODUCTION UNITS WAS RESTRICTIVE AND PRECLUDED YOU OR ANY OTHER OFFEROR FROM MEETING EVEN THE REVISED DELIVERY DATES. ALSO, YOU CONTEND THAT THE CONTRACTING OFFICER INCORRECTLY INTERPRETED YOUR OBJECTION TO A REQUEST FOR WAIVER OF THE TESTING REQUIREMENTS AND, THEREFORE, IMPROPERLY REJECTED YOUR PROPOSAL. IN THIS CONNECTION, IT IS YOUR POSITION THAT NOT ONLY DID YOUR WRITTEN REVISION TO YOUR PROPOSAL CLEARLY INDICATE THAT THE REQUEST FOR WAIVER RELATED ONLY TO THE REQUIREMENT FOR TESTING PRIOR TO MANUFACTURING, WHICH WOULD PREVENT TIMELY DELIVERY, BUT THAT THIS WAS EXPLAINED TO THE CONTRACTING OFFICER PRIOR TO THE AWARD WHEN HE VISITED YOUR OFFICE ON APRIL 6-7, 1972. FURTHERMORE, YOU CONTEND THAT THE REQUESTED WAIVER WAS JUSTIFIED BECAUSE OF YOUR PROPOSAL TO FURNISH ENCLOSURES IDENTICAL TO THOSE PREVIOUSLY FURNISHED BY FILTRON.

THE CONTRACTING OFFICER REPORTS THAT WHILE THE MATTER OF WAIVER OF TEST REQUIREMENTS WAS CONSIDERED DURING NEGOTIATIONS, IT WAS CONCLUDED THAT THIS WAS NOT NECESSARY IN ORDER TO INSURE TIMELY DELIVERY BECAUSE OF THE REVISION OF THE RFP PERMITTING SEPARATE DELIVERY OF THE ENCLOSURES AND FILTER ELEMENTS. ALSO, HE STATES THAT THE WAIVER OF ANY SUCH REQUIREMENT WAS NOT POSSIBLE BECAUSE OF THE CRITICALITY OF THE FUNCTIONAL REQUIREMENTS OF THE FILTERS. FURTHER, HE ASSERTS THAT IT WAS POSSIBLE TO MEET THE DELIVERY REQUIREMENTS BECAUSE CERTAIN TESTS COULD BE COMPLETED WITHIN TEN DAYS AFTER MANUFACTURE OF THE ENCLOSURES AND FILTER ELEMENTS, THE ENCLOSURES COULD THEN BE SHIPPED, AND THE BALANCE OF THE TESTING REQUIRED FOR THE ELEMENTS COMPLETED THEREAFTER AND BEFORE THEIR LATER REQUIRED DELIVERY DATE. IN ADDITION, HE DENIES YOUR CONTENTION THAT SEQUENTIAL TESTING WAS REQUIRED AND, THEREFORE, PRECLUDED THE LATTER APPROACH. MOREOVER, IT IS HIS POSITION THAT FULL PERFORMANCE OF THE TESTS COULD HAVE BEEN ACCOMPLISHED WITHIN THE DELIVERY CONSTRAINTS BY PRODUCING EXTRA FILTER UNITS FOR TESTING CONCURRENTLY WITH PRODUCTION UNITS. FINALLY, HE REJECTS YOUR CONTENTION THAT THE FURNISHING OF FILTERS IDENTICAL TO THE FILTRON FILTER WAS AN ADEQUATE BASIS TO WAIVE TESTING, AS THE FILTERS DELIVERED UNDER FILTRON'S DEFAULTED CONTRACT HAVE BEEN FOUND TO BE AS MUCH AS 40 PERCENT DEFICIENT.

FINALLY, IT IS REPORTED THAT AFTERWARD R F INTERONICS PROVIDED THE CONTRACTING OFFICER A MILESTONE CHART SHOWING ON A TIME BASIS THE KEY ELEMENTS OF PERFORMANCE IN ORDER TO MEET THE STRINGENT DELIVERY SCHEDULE. THE CONTRACTOR STAYED ON SCHEDULE UNTIL THE FAULT CURRENT TEST FAILED ON MAY 30, 1972. BECAUSE OF SCHEDULING DIFFICULTIES WITH THE INDEPENDENT TESTING FACILITY, IT WAS IMPOSSIBLE TO RESCHEDULE THE TESTING UNTIL JUNE 14, 1972, AT WHICH TIME THE TESTS WERE SUCCESSFULLY COMPLETED. THE CONTRACTOR REQUESTED A WAIVER OF THE ASSEMBLY SHOCK TEST. AFTER AN ENGINEERING REVIEW OF THE SHOP DRAWING OF THE ENCLOSURE, AS WELL AS AN ON- SITE EXAMINATION OF A TYPICAL ENCLOSURE, THE REQUEST WAS GRANTED. THE WAIVER WAS REPORTEDLY APPROVED BASED UPON THE SIMILARITY BETWEEN THE DESIGN OF THE ENCLOSURE AND OTHER RFI ENCLOSURES THAT HAD PREVIOUSLY SUCCESSFULLY PASSED ASSEMBLY SHOCK TESTING. THEREAFTER, ALL OF THE ENCLOSURES DUE TO BE DELIVERED ON JUNE 15, 1972, WERE DELIVERED ON JUNE 30, 1972. APPARENTLY OTHER DELIVERIES DUE THEREAFTER HAVE BEEN TIMELY.

THE PRIMARY RESPONSIBILITY FOR DETERMINING THE NEEDS OF THE GOVERNMENT AND FOR DRAFTING SPECIFICATIONS REFLECTING THOSE NEEDS, AS WELL AS THE FACTUAL DETERMINATION OF COMPLIANCE WITH THOSE SPECIFICATIONS, RESTS WITH THE PROCURING ACTIVITY AND WILL NOT BE QUESTIONED BY OUR OFFICE UNLESS CLEARLY ARBITRARY, CAPRICIOUS, OR LACKING A FACTUAL BASIS. 49 COMP. GEN. 857, 862 (1970). WHILE THE CONTRACTOR'S EXPERIENCE IN PERFORMANCE OF THE CONTRACT TENDS TO BEAR OUT YOUR WARNING OF THE INCOMPATIBILITY OF THE TESTING REQUIREMENTS WITH THE DELIVERY DATES, WE BELIEVE THAT THE REASONABLENESS OF THE CONTRACTING OFFICER'S ACTIONS MUST BE VIEWED IN THE CONTEXT OF THE SITUATION AS IT EXISTED AT THAT TIME. AS NOTED ABOVE, HE WAS FACED WITH THE TASK OF AN URGENT PROCUREMENT BECAUSE OF FILTRON'S DEFAULT AND THE KNOWLEDGE THAT QUALITY ASSURANCE WAS PARAMOUNT BECAUSE THE PREVIOUSLY DELIVERED FILTERS WERE AS MUCH AS 40 PERCENT DEFICIENT. IN AN EFFORT TO BALANCE THESE CRITICAL NEEDS, HE REVISED THE ORIGINAL DELIVERY DATES BASED UPON THE INITIAL RESPONSES OF THE OFFERORS AND SEPARATED DELIVERY OF THE ENCLOSURES FROM THE FILTER ASSEMBLIES TO BETTER ACCOMMODATE THE TESTING AND DELIVERY REQUIREMENTS. FURTHERMORE, THE OTHER THREE OFFERORS INDICATED THEIR WILLINGNESS AND ABILITY TO MEET THE TESTING AND DELIVERY REQUIREMENTS. IN THESE CIRCUMSTANCES, WE ARE UNABLE TO CONCLUDE THAT THE CONTRACTING OFFICER ACTED UNREASONABLY.

ACCORDINGLY, YOUR PROTEST IS DENIED.