September 22, 2021

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[Request for Reconsideration of Protest of DCSC Solicitation for Hydraulic Motor Race Assemblies]

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<div>A firm requested reconsideration of its denied protest of a Defense Construction Supply Center (DCSC) solicitation for hydraulic motor race assemblies. GAO had held that the protester: (1) had an adequate opportunity to qualify its product, since it knew of the qualification requirements at least 2 years prior to the procurement; and (2) never submitted any items for testing or made any deliveries under its previous contract. In its request for reconsideration, the protester reiterated arguments raised during its original protest and contended that GAO failed to address its assertions that: (1) the two named manufacturers were not properly qualified sources; (2) DCSC failed to revalidate its qualification requirements; and (3) one manufacturer had an organizational conflict of interest. GAO held that the protester: (1) failed to provide any evidence that warranted reversal of the original decision; (2) should have raised the revalidation issue during its original protest; and (3) merely anticipated improper DCSC action regarding the manufacturer's alleged conflict of interest. Accordingly, the request for reconsideration was denied.</div>

Matter of: Saturn Industries–Reconsideration File: B-261954.4 Date: July 19, 1996

Request for reconsideration is denied where requesting party reiterates arguments raised during the initial protest, raises arguments that could have been but were not raised during the initial protest, and fails to demonstrate that the decision contains errors of fact or law.

Attorneys

DECISION

Saturn Industries requests reconsideration of our decision, Saturn Indus., B-261954.3, Jan. 5, 1996, 96-1 CPD para. 9, in which we denied Saturn’s protest challenging the provisions of solicitation No. SPO750-95-R-0213, issued by the Defense Construction Supply Center (DCSC), Defense Logistics Agency (DLA). The solicitation sought proposals to provide 515 hydraulic motor race assemblies, national stock number (NSN) 2530-01-109-4375, to be used in the transmission of the M2 and M3 Bradley Fighting Vehicle. Saturn asserts that our decision failed to adequately address various protest issues.

We deny the reconsideration request.

The challenged solicitation was issued on May 22, 1995, and provided that one of the assembly components (the race) was source controlled. [1] In that regard, the solicitation established qualification requirements with which an offeror must comply to become a qualified source, stating:

“Qualification testing of [the race component will require a 100 hour dynamometer test ($75,000) [and] 6000 mile on-vehicle test ($25,000) and $25,000 for analysis and final report before source approval can be given . . . . Contractor would need to supply eight [race components] . . . along with the above funds, to the government for testing. Testing would take six to nine months.”

In its protest, Saturn challenged the solicitation’s qualification requirements on the basis that it had not been given a reasonable opportunity to qualify its product. Specifically, Saturn asserted:

“As written, the solicitation requires delivery of the race assemblies within 150 days of contract award. The Item Description indicates that qualification testing requires six to nine months. Therefore it is not possible for any potential offeror to compete in this procurement if its offered product is not qualified, or at least one to four months into testing, at the time of award.

“. . . DCSC has therefore, in effect, unreasonably limited the competition by specifying lengthy testing requirements which cannot be met by unqualified offerors. This violates the requirement in 10 U.S.C. Sec. 2319 that nonapproved sources be given a reasonable opportunity to qualify.”

As we pointed out in our decision, the record belied Saturn’s representations that it had not been afforded an adequate opportunity to qualify its component. Specifically, the record established that, in December 1992, Saturn was awarded a contract to supply the race assemblies being procured under the challenged solicitation. [2] There, as here, the solicitation provided that the race component was source controlled and identified Martin Marietta and Kaydon as the qualified sources. By letter to the agency dated December 22, 1992, Saturn requested waiver of the source control requirements. [3] In February 1993, Saturn submitted a request to become a qualified source. Saturn was subsequently advised of the specific requirements it must meet to qualify as a source for the race component; those requirements were identical to the qualification requirements in the solicitation here. Specifically, by letter dated June 8, 1993, Saturn was advised that qualification testing would include a “100 hour dyno test” and a “6000 mile on-vehicle test,” that “Saturn would need to supply eight parts [for testing],” that “testing would take 6-9 months,” and that “Saturn would be required to pay for all costs associated with qualification.” By letters dated July 19, September 15, and December 10, 1993, and February 8, 1994, DLA reiterated the qualification requirements. Despite the government’s clear statements regarding the ongoing need for the qualification requirements, Saturn failed to submit any components for qualification testing, and made no deliveries under its prior contract. That contract was terminated by the government in July 1994.

Based on the facts summarized above, our decision rejected Saturn’s assertion that it had not been given a “reasonable opportunity to qualify [its product].” The record was clear beyond dispute that Saturn had been repeatedly advised of the precise testing requirements which its protest challenged. Despite the agency’s multiple requests that Saturn submit its component for testing, Saturn failed to do so–and the record indicates that Saturn has yet to manufacture any of those components. Saturn’s reconsideration request presents no new evidence or argument demonstrating factual or legal errors in our decision regarding this matter; accordingly, there is no basis for reconsideration regarding this issue. See John Peeples–Recon., B-233167.3, Dec. 9, 1991, 91-2 CPD para. 522.

Saturn also complains that our decision failed to properly address its assertion that Martin Marietta and Kaydon were not subjected to the current qualification testing requirements and, therefore, are not properly qualified sources. Repeating assertions made in its protest, Saturn asserts that “the qualifications of both Lockheed Martin and Kaydon are at a minimum, not properly documented and more likely, never occurred.”

In responding to Saturn’s protests regarding this issue, the agency explained that the race assemblies were developed by Kaydon and General Electric Corporation (Martin Marietta’s corporate predecessor for this item) between 1984 and 1986 and that, during that period, the race component was subjected to a series of tests and inspections integrated within the development process; however, most of the documentation relating to that development no longer exists. Notwithstanding the current lack of documentation, the agency pointed out that the operational testing requirements to which Saturn objects are intended to demonstrate the component’s capability to perform under actual operating conditions, and that the components currently being provided have repeatedly been, and continue to be, tested under such conditions.

In our decision, we specifically stated: “Saturn asserts that the race components being provided by the previously approved sources were not subjected to the testing requirements that are now required.” Our decision rejected that argument noting that, notwithstanding the inability of the agency to, at this time, produce documentation of its prior development efforts, Saturn offers no rational argument to support its assertion that, in developing the race assembly as a new component, the agency failed to subject it to operational testing. Similarly, we noted that Saturn did not rebut the agency’s explanation that the currently fielded components have repeatedly demonstrated their capability to perform under actual operating conditions and, as such, are continuously subjected to the same testing requirements which Saturn asserts were never performed. Saturn’s reconsideration request offers no new arguments or evidence on these issues and merely reflects its disagreement with our prior decision, which does not constitute a valid basis for reconsideration. See, John Peeples–Recon., supra. [4]

Saturn also complains that our decision failed to separately discuss whether the agency has satisfied the procedural requirements associated with its obligation to examine and revalidate the qualification requirements. See 10 U.S.C. Sec. 2319(e); FAR Sec. 9.202(f) (FAC 90-2). Saturn did not raise this matter in its protest; nonetheless, in seeking reconsideration, it points to the fact that the agency was requested to provide documents pertaining to the maintenance and revalidation of the qualification requirements. Significantly, Saturn does not question the actual, ongoing need for the qualification requirements. In particular, Saturn’s reconsideration request expressly states: “[Saturn] has not asserted that the need for qualification [of this safety critical item] is improper.” As our decision pointed out, the race assemblies are properly classified as “safety critical” in that component failure during operation could result in personal injury to military personnel. [5] In light of Saturn’s express acknowledgment of the legitimate, ongoing need for qualification requirements, Saturn’s assertion regarding the agency’s alleged failure to properly document its revalidation provides no basis to object to the agency’s actions. Moreover, Saturn’s initial protest did not assert that the agency failed to comply with the revalidation requirements. In short, Saturn has neither raised the issue now in a manner which would provide a basis to sustain its protest, nor did it raise the issue in any meaningful fashion in its initial protest when it could and should have done so.

Finally, Saturn asserts that our decision failed to adequately address its allegation of an organizational conflict of interest with regard to Martin Marietta. Saturn’s protest in this regard was based on the fact that Martin Marietta provides engineering support services for the Bradley Fighting Vehicle under a systems technical support contract and, as such, will assist the agency in testing Saturn’s component.

Since Saturn has yet to manufacture and submit its component for testing, we found no basis to sustain Saturn’s protest on the basis of an anticipated conflict of interest. Saturn appears to be seeking reassurance that the agency will objectively evaluate its component if and when Saturn manufactures and submits the component. In response to this concern, the agency has provided express assurance that it will objectively evaluate the component. Saturn’s speculation that the agency will fail to perform an objective evaluation merely anticipates improper agency action and, therefore, is not for consideration. See, e.g., Sea- Land Serv., Inc., B-246784.6; B-253068, Aug. 5, 1993, 93-2 CPD para. 84; Harbor Branch Oceanographic Inst., Inc., B-243417, July 17, 1991, 91-2 CPD para. 67; Jantec, Inc., B-243192, Mar. 14, 1991, 91-1 CPD para. 289; General Elec. Canada, Inc., B-230584, June 1, 1988, 88-1 CPD para. 512; Logistical Support, Inc., B-218465, Apr. 18, 1985, 85-1 CPD para. 447; Riggins Co., Inc., B-214460, July 31, 1984, 84-2 CPD para. 137; Surgical Instrument Co. of Am., B-215026, July 25, 1984, 84-2 CPD para. 112; Afri- American Supply Co., B-206137, Feb. 17, 1982, 82-1 CPD para. 141.

The request for reconsideration is denied.

Comptroller General of the United States

1. The solicitation identified Martin Marietta Defense Systems (now Lockheed Martin) and Kaydon Corporation as the only approved sources.

2. Saturn’s prior contract for the race assemblies, No. DLA 770-93-C-3520, was awarded on December 15, 1992.

3. The agency formally denied that request by letter dated July 19, 1993.

4. It appears that Saturn’s primary objective is to have the government, rather than Saturn, bear the testing costs. As we noted in our decision, offerors are generally required to bear their own costs of qualification testing. See 10 U.S.C. Sec. 2319(b)(3); Federal Acquisition Regulation (FAR) Sec. 9.202(a)(1)(ii). Agencies are permitted, under certain circumstances, to bear such costs. See 10 U.S.C. Sec. 2319(d)(1)(B); FAR Sec. 9.204(a)(2). Here, the record presented no indication that the agency had abused its discretion; accordingly, this issue provided no basis to sustain Saturn’s protest.

5. FAR Sec. 46.203 establishes criteria for designating a product as “safety critical,” thereby necessitating qualification testing requirements.

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  • Securing, Stabilizing, and Rebuilding Iraq: Progress Report: Some Gains Made, Updated Strategy Needed
    In U.S GAO News
    In January 2007, the President announced a new U.S. strategy to stem the violence in Iraq and help the Iraqi government foster conditions for national reconciliation. In The New Way Forward, the Administration articulated near-term goals to achieve over a 12- to 18-month period and reasserted the end state for Iraq: a unified, democratic, federal Iraq that can govern, defend, and sustain itself and is an ally in the war on terror. To support this strategy, the United States increased its military presence and financial commitments for Iraq operations. This testimony discusses (1) progress in meeting key security, legislative, and economic goals of The New Way Forward; and (2) past and current U.S. strategies for Iraq and the need for an updated strategy. GAO reviewed documents and interviewed officials from U.S. agencies, MNF-I, the UN, and the Iraqi government. GAO also had staff stationed in Baghdad. Since 2003, GAO has issued about 140 Iraq-related products, which provided baseline information for this assessment.The United States has made some progress in achieving key goals stated in The New Way Forward. Looking forward, many challenges remain, and an updated strategy is essential. In the security area, violence--as measured by the number of enemy-initiated attacks--decreased about 80 percent from June 2007 to June 2008, trained Iraqi security forces have increased substantially, and many units are leading counterinsurgency operations. However, as of July 2008, 8 of 18 provincial governments do not yet have lead responsibility for security in their provinces, and DOD reported that, in June 2008, less than 10 percent of Iraqi security forces were at the highest readiness level and therefore considered capable of performing operations without coalition support. The security environment remains volatile and dangerous. In the legislative area, Iraq has enacted key legislation to return some Ba'athists to government, grant amnesty to detained Iraqis, and define provincial powers. The unfinished Iraqi legislative agenda includes enacting laws that will provide the legal framework for sharing oil revenues, disarming militias, and holding provincial elections. On economic and infrastructure issues, Iraq spent only 24 percent of the $27 billion it budgeted for its reconstruction efforts between 2005 and 2007. Although crude oil production improved for short periods, the early July 2008 average production capacity of about 2.5 million barrels per day was below the U.S. goal of 3 million barrels per day. In addition, while State reports that U.S. goals for Iraq's water sector are close to being reached, the daily supply of electricity in Iraq met only slightly more than half of demand in early July 2008. Since 2003, the United States has developed and revised multiple strategies to address security and reconstruction needs in Iraq. The New Way Forward responded to failures in prior U.S. plans and the escalating violence that occurred in 2006. However, this strategy and the military surge that was central to it end in July 2008, and many agree that the situation remains fragile. GAO recommends an updated strategy for Iraq for several reasons. First, much has changed in Iraq since The New Way Forward began in January 2007. Violence is down, U.S. surge forces are leaving, and the United States is negotiating a security agreement with Iraq to replace the expiring UN mandate. Second, The New Way Forward only articulates U.S. goals and objectives for the phase that ends in July 2008. Third, the goals and objectives of The New Way Forward are contained in disparate documents rather than a single strategic plan. Furthermore, the classified MNF-I/U.S. Embassy Joint Campaign Plan is not a strategic plan; it is an operational plan with limitations that GAO will discuss during the closed portion of the hearing.
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  • Defense Health Care: Status of Fiscal Year 2004 Requirements for Reservists’ Benefits and Monitoring Beneficiaries’ Access to Care
    In U.S GAO News
    Since September 2001, about 360,000 reservists have been called to active duty to support the war on terrorism, conflicts in Afghanistan and Iraq, and other operations. Some reservists have been on active duty for a year or more, and the pace of reserve operations is expected to remain high for the foreseeable future. When mobilized for active duty under federal authorities, reservists are eligible to receive health care benefits through DOD's military health care system, TRICARE. When reservists are ordered to active duty for more than 30 days, their families are also eligible for health benefits. DOD supplements its military health care facilities with civilian health care providers through its triple-option TRICARE program. DOD's beneficiaries may enroll in TRICARE's Prime option and go to a network provider to receive care; without enrolling, they can see a network provider through the preferred provider option, Extra; or they may elect to use Standard, the fee-for-service option. Some beneficiaries have raised concerns about difficulties in finding civilian providers--particularly Standard, non-network providers--who will accept TRICARE beneficiaries as patients. The National Defense Authorization Act (NDAA) for Fiscal Year 2004, enacted on November 24, 2003, required the Department of Defense (DOD) to make changes in its delivery and monitoring of health benefits. In addition, the law directed us to review and report on aspects of these requirements. As agreed with the committees of jurisdiction, we are providing the status of DOD's progress in implementing five requirements--three related to health benefits for reservists and two related to monitoring beneficiaries' access to care under TRICARE Standard.In summary, DOD is in various stages of implementing the three requirements related to health care coverage for reservists. DOD has implemented the requirement extending the time reservists and their families can use TRICARE and is in the process of implementing the other two requirements. DOD has not implemented the two requirements directed at enhanced monitoring of beneficiaries' access to care under TRICARE Standard. We will report further on these requirements as DOD makes progress.
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  • Dark Web Child Pornography Facilitator Sentenced to 27 Years in Prison for Conspiracy to Advertise Child Pornography
    In Crime News
    A dual national of the United States and Ireland was sentenced yesterday to 324 months, or 27 years, in federal prison followed by a lifetime of supervised release for conspiracy to advertise child pornography.
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  • Sanctioning Cuban Officials in Response to Violence against Peaceful Protestors
    In Crime Control and Security News
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  • Former Florida Resident Indicted for Tax Evasion and Failing to Report Foreign Bank Accounts
    In Crime News
    A federal grand jury returned an indictment today charging Lucia Andrea Gatta, a former resident of Palm Beach County, Florida, with tax evasion and failing to file Reports of Foreign Bank and Financial Accounts (FBARs), among other offenses, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Ariana Fajardo Orshan for the Southern District of Florida.
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  • Man Pleads Guilty to COVID-19 Relief Fraud Scheme
    In Crime News
    A Washington man pleaded guilty today to perpetrating a scheme to fraudulently obtain COVID-19 relief guaranteed by the Small Business Administration (SBA) through the Economic Injury Disaster Loan (EIDL) and the Paycheck Protection Program (PPP) under the Coronavirus Aid, Relief and Economic Security (CARES) Act.
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