Link: GAO Opinion
Agency: Defense Logistics Agency
Disposition: Protests denied.
_________________________________________________________________________________________________________________
GAO Digest:
Protests that two solicitations for radomes, which limit competition to vendors that are eligible for waiver of first article testing, unduly restrict competition are denied, where the agency has reasonably demonstrated that waiver is necessary to fulfill its urgent requirement for radomes; protester was not denied a fair opportunity to compete, where protester’s radomes failed testing provided by the agency and protester is not eligible for waiver.
General Counsel P.C. Highlight:
Starwin contends that the inclusion of a provision that limits the competition to vendors who are eligible for waiver of first article testing (FAT) requirements is unduly restrictive. GAO states that a contracting agency’s responsibility for determining its actual needs includes determining the type and amount of testing necessary to ensure product compliance with specifications. In this regard, an agency may properly restrict award to a source qualifying for FAT waiver when such waiver is essential to meet the required delivery schedule or where there is a critical need for certain supplies. GAO’s review of an agency’s decision to waive, or not waive, FAT requirements for a particular vendor is limited to determining whether the agency’s decision was reasonable.
Based on the record, GAO finds that the agency has reasonably justified the need for FAT waiver in these procurements. As DSCC explained, the radomes are “[a]eronautical critical safety items” for which the military has an “urgent outstanding need.” DSCC has not had any AFT or forward transmit radomes in stock for more than two years, in large part due to Starwin’s paint and delamination failures. The agency had to suspend orders from Starwin in 2007, could not use any of Starwin’s radomes that were in stock because of the failures, and backorders continued to accumulate while both Starwin’s and the awardee’s radomes were being tested in 2007 and 2008. In addition to the backlog, there is an ongoing and recurring need for radomes that also must be filled. As the agency explains, for a non-waived source to fill the requirements, it would take 400 to 450 days to fill the requirements, including the time for FAT, while the production lead time for AFT transmit radomes is only 150 days and the production lead time for forward transmit radomes is only 210 days. By restricting the RFQs to FAT-waived sources or sources eligible for waiver, the agency is able to get the items to the military customer more than eight months sooner than if it did not limit sources. Given the critical need for these items, GAO finds this restriction to be reasonable.
GAO also finds no basis to conclude that Starwin was denied a fair opportunity to compete. In this regard, the record shows that the government provided Starwin with the same opportunity as the awardee to have its radomes tested at no cost to Starwin. Starwin’s president participated in the testing, and Starwin does not allege that the testing was flawed. The test report shows that Starwin’s radomes failed testing in significant ways. Starwin has not identified any steps that it has taken to address these failures, such that it could pass the tests if the tests were repeated. Starwin also is not precluded from repeating the testing at its own expense. The protests are denied.