BNUMBER:  B-261954.3
DATE:  January 5, 1996
TITLE:  Saturn Industries

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Matter of:Saturn Industries

File:     B-261954.3

Date:     January 5, 1996

George W. Ash, Esq., and William J. Lewandowski, Esq., Dykema Gossett, 
for the protester.
Gwendolyn M. Hoover, Esq., Defense Logistics Agency, and Arthur M. 
Boley, Esq., Department of the Army, for the agencies.
Glenn G. Wolcott, Esq., and Paul Lieberman, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Agency reasonably determined that qualification testing of a 
transmission component for the Bradley Fighting Vehicle is required 
where the component is a critical item, the failure of which would 
create a serious safety risk.

2.  Protester has had reasonable opportunity to meet qualification 
requirements where it has known of those requirements for more than 2 
years.  

3.  Qualification requirements in solicitation do not represent 
unequal treatment of protester where previously approved sources have 
similarly demonstrated the operational capabilities of their 
components.

DECISION

Saturn Industries protests certain provisions of solicitation No. 
SPO750-95-R-0213 issued by the Defense Construction Supply Center 
(DCSC), Defense Logistics Agency (DLA), seeking proposals to provide 
515 hydraulic motor race assemblies, national stock number (NSN) 
2520-01-109-4375, to be used in the transmission of the M2 and M3 
Bradley Fighting Vehicle.  Saturn raises various issues regarding the 
solicitation's qualification requirements for a component of the race 
assemblies.

We deny the protest.

BACKGROUND

The Solicitation

On May 5, 1995, DLA published a notice in the Commerce Business Daily 
(CBD) announcing its intention to purchase 515 race assemblies, NSN 
2520-01-109-4375.  The solicitation was issued on May 22.  The 
solicitation stated that one of the assembly components (the race) was 
source controlled,[1] and referenced drawings identifying Martin 
Marietta Defense Systems[2] and Kaydon Corporation as the only 
approved sources of this component.[3]  Specifically, the solicitation 
stated

     "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."

On July 7, Saturn filed a protest with our Office challenging the 
validity of the qualification requirements.  The closing date for 
submission of proposals was July 10; Saturn did not submit a proposal.  
Following the agency's response to its July 7 protest, Saturn filed 
supplemental protests on August 23 and August 25.     

Saturn's Prior Contract

In December 1992, Saturn was awarded a contract to supply the race 
assemblies, NSN 2520-01-109-4375, which are being procured under the 
protested solicitation.[4]  There, as here, the solicitation provided 
that the race components of the race assemblies were source 
controlled, and identified Martin Marietta and Kaydon Corporation as 
the only approved sources.  By letter to the agency dated December 22, 
1992, Saturn requested waiver of those source control requirements.  
That request was formally denied by letter dated July 19, 1993.  

On February 4, 1993, Saturn submitted a request to the U.S. Army 
Tank-Automotive Command (TACOM) to become an approved source for the 
race component.[5]  By letter from TACOM's Small Business Liaison 
Office dated June 8, 1993, Saturn was advised of specific testing 
requirements that would be necessary in order for it to become an 
approved source of the component.  Those requirements are identical to 
the qualification requirements in the solicitation now being 
protested.  Specifically, Saturn was advised that, with regard to NSN 
2520-01-109-4375, qualification testing would require a "100 hour dyno 
test," as well as a "6000 mile on-vehicle test."  The June 8, 1993, 
letter further stated, "Saturn would need to supply eight parts, four 
per [transmission]," that "testing would take 6-9 months," and that 
"Saturn would be required to pay for all costs associated with 
qualification."  

Despite the clear statement that Saturn would not become an approved 
source until testing of its component had been performed, Saturn did 
not submit any race components for testing.  Rather, Saturn 
subsequently made repeated requests for waiver of the source control 
requirements to various government officials.  By letters to Saturn 
dated July 19, 1993, September 15, 1993, December 10, 1993, and 
February 8, 1994, DLA reiterated the fact that the testing 
requirements would not be waived.  Each of these letters specifically 
referenced NSN 2520-01-109-4375.  Ultimately, Saturn made no 
deliveries of the race assemblies under its prior contract; that 
contract was terminated for the convenience of the government on July 
28, 1994.  

DISCUSSION

Saturn first protests that the testing requirements for the race 
component, that is, the 100-hour dynamometer test and 6,000-mile 
on-vehicle test, lack a reasonable basis and, therefore, unreasonably 
restrict competition in violation of 10 U.S.C.  2304 (1994).     

The agency responds that the testing requirements are necessary to 
demonstrate the component's capability to perform under actual 
operating conditions.  During operation, the race assembly is 
subjected to high alternating stresses and may experience reversing 
rotating piston load, along with varying accelerations and 
decelerations of the ball pistons.  Accordingly, dimensional, visual, 
and metallurgical inspections were considered insufficient, and the 
agency concluded that demonstration testing was necessary.[6]  
Further, the agency explains that the race assemblies are "safety 
critical," inasmuch as component failure during operation could result 
in personnel injury from flying debris as well as cause sudden loss of 
vehicle control.[7] 

Saturn criticizes the agency's determination regarding the testing 
requirements on the basis that the agency relied on input from Martin 
Marietta in making its determination.[8]  Nonetheless, Saturn offers 
neither evidence nor argument that the above-stated facts are 
inaccurate or that the risks identified are inconsequential or 
otherwise should not be considered.  
 
Generally, an agency's determination that testing is required is a 
matter within the technical competence of the procuring agency, and we 
will not disturb the agency's position in that respect in the absence 
of clear evidence indicating the position is unreasonable.  Hill 
Aviation Logistics, 67 Comp. Gen. 244 (1988), 88-1 CPD  140; 
Electro-Methods, Inc., B-255023.3; B-255023.4, Mar. 4, 1994, 94-1 CPD  
173.  Here, the record identifies specific safety concerns which led 
to the agency's determination that operational testing was necessary.  
The record further indicates that there were performance problems 
associated with the race component during its development stage.  
Accordingly, Saturn's general assertion that the testing requirements 
are unnecessary fails to establish that TACOM's contrary 
determination, based on the provisions of FAR  46.203, is 
unreasonable.  There is simply no basis to question the agency's 
determination regarding the testing requirements.

Saturn next protests that it has not been given a reasonable 
opportunity to qualify as an approved source.  Saturn notes that 
although the solicitation requires delivery of the race assemblies 
within 150 days following award qualification testing is expected to 
take from 6 to 9  months.  On this basis, Saturn complains "it is not 
possible for [Saturn] to compete . . . if its offered product is not 
qualified, or at least one to four months into testing, at the time of 
award."  

When a contracting agency restricts a contract award to only approved 
sources and imposes qualification requirements, unapproved sources 
should be given a reasonable opportunity to qualify.  10 U.S.C.  2319 
(1994).  However, an agency is not required to delay a procurement 
solely to provide a potential offeror an opportunity to demonstrate 
its ability to become approved.  10 U.S.C.  2319(c)(5); Tura Mach. 
Co., B-241426, Feb. 4, 1991, 91-1 CPD  114.  This is particularly 
true where the offeror contributes to its failure to obtain timely 
source approval.  See The Purdy Corp., B-259066, Mar. 1, 1995, 95-1 
CPD  120; Texstar, Inc., B-239905, Oct. 9, 1990, 90-2 CPD  273. 

 As discussed above, Saturn was advised by letter dated June 8, 1993, 
of the precise testing requirements for the race assemblies, NSN 
2520-01-109-4375, to which it now objects.  At that time Saturn was 
requested to submit components for testing; it did not do so.  
Further, as indicated, Saturn was repeatedly advised by the agency 
that the source control requirements would not be waived.  Despite 
Saturn's protest, Saturn has not yet submitted any race components to 
the government for testing.[9]  On this record, Saturn's protest that 
it has not been given a reasonable opportunity to comply with the 
qualification requirements is without merit.[10]   

Saturn next protests that it is being subjected to unequal treatment 
in comparison to Martin Marietta and Kaydon.  Saturn asserts that the 
race components being provided by the previously approved sources were 
not subjected to the testing requirements that are now required.  
Again, the record contradicts Saturn's assertions.  

First, the agency states that, in fact, the race assemblies currently 
being provided were developed between 1984 to 1986, and that, during 
that period, the race component was subjected to a series of tests and 
inspections integrated within the development process.  More 
significantly, the agency notes that the operational testing 
requirements to which Saturn objects are intended to demonstrate the 
component's capability to perform under operating conditions, and that 
the components currently being provided have been, and continue to be, 
repeatedly tested under actual operating conditions.  Although the 
protester complains that there is inadequate documentation regarding 
the developmental testing that occurred from 1984 to 1986,[11] Saturn 
offers no rational argument to support the unfounded assertion that, 
in developing the race assembly as a new component, the agency failed 
to subject it to operational testing.  Further, Saturn offers no 
rebuttal of the agency's statement that the currently fielded 
components have repeatedly demonstrated their capability to perform 
under actual operating conditions and, as such, have been subjected to 
essentially the same testing requirements to which Saturn now objects.  
Accordingly, Saturn's assertions that the solicitation's testing 
requirements represent unequal treatment are without merit.[12]  

The protest is denied.  

Comptroller General 
of the United States

1. The solicitation also stated that a second component (the bushing) 
was source controlled.  The requirements regarding that component are 
not at issue in this protest.

2. Martin Marietta is now Lockheed Martin.  To avoid confusion, we 
refer only to Martin Marietta throughout this decision.

3. The agency explains that Kaydon is the only currently approved 
manufacturer of the race component.  Martin Marietta was identified as 
an approved source because it is the corporate successor to General 
Electric Corporation, the original equipment manufacturer of the 
Bradley transmission; as such, Martin Marietta maintains a supply of 
the Kaydon-manufactured race components. 

4. Contract No. DLA 770-93-C-3520 was awarded to Saturn on December 
15, 1992.

5. Although DCSC manages acquisitions of the race assembly, NSN 
2520-01-109-4375, TACOM is the engineering support activity and 
program manager for the Bradley Fighting Vehicle.  As such, TACOM is 
responsible for qualifying any new source.

6. There are references in the record to operational problems that 
occurred during the development of the race assembly.

7. With regard to the "safety critical" nature of the race assembly, 
the agency references Federal Acquisition Regulation (FAR)  46.203, 
which states

            "Criteria for Use of Contract Quality Requirements"

            "The extent of contract quality requirements . . . 
            required under a contract shall usually be based upon the 
            classification of the contract item (supply or service) as 
            determined by its technical description, its complexity, 
            and the criticality of its application.

                           .     .     .     .     .

            "(c)(1)  A critical application of an item is one in which 
            the failure of the item could injure personnel or 
            jeopardize a vital agency mission."

8. Martin Marietta provides TACOM with engineering support services 
for the Bradley Fighting Vehicle under a systems technical support 
contract.

9. The record indicates that Saturn has not yet manufactured any race 
components.

10. Saturn complains that TACOM has not agreed to bear the component 
testing costs for Saturn.  In this regard, offerors are generally 
required to bear their own costs of qualification testing.  See 10 
U.S.C.  2319(b)(3); Federal Acquisition Regulation (FAR)  
9.202(a)(1)(ii).  The law provides that, under certain circumstances, 
an agency may bear the testing costs for a small business concern if 
the agency determines that such additional qualified source is likely 
to result in a net cost savings to the government due to increased 
competition for future requirements.  See 10 U.S.C.  2319(d)(1)(B); 
FAR  9.204(a)(2).  Saturn submitted a request that the agency bear 
its testing costs 1 day prior to filing its protest.  The agency 
states that it is currently considering the request.  To the extent 
Saturn's protest is based on an assumption that the agency will 
decline to bear the testing costs, the protest is premature.  Protests 
which merely anticipate allegedly improper agency action will not be 
considered.  See, e.g., Jantec, Inc., B-243192, Mar. 14, 1991, 91-1 
CPD  289.  

11. The agency states that most of the documentation relating to that 
development period no longer exists.

12. Saturn also asserts that an organizational conflict of interest 
exists because, under Martin Marietta's system technical support 
contract, Martin Marietta will assist TACOM in the assessment of 
Saturn's race component. Since Saturn has not yet submitted its 
component to the agency for testing, its speculation that the agency 
will be improperly prejudiced by input from Martin Marietta merely 
anticipates allegedly improper agency action.  See Jantec, Inc., 
supra.  In any event, the agency notes that TACOM, not Martin 
Marietta, will make the final determination with regard to 
qualification of Saturn as an approved source, thereby complying with 
its obligation to avoid, neutralize or mitigate any potential conflict 
of interest that might exist.  See FAR  9.501, 9.504, 9.505; D.K. 
Shifflet & Assocs., Ltd., B-234251, May 2, 1989, 89-1 CPD  419.