BNUMBER:  B-277660 
DATE:  November 4, 1997
TITLE: Sun Dial and Panel Corporation, B-277660, November 4, 1997
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DOCUMENT FOR PUBLIC RELEASE
The decision issued on the date below was subject to a GAO Protective 
Order.  This redacted version has been approved for public release.
Matter of:Sun Dial and Panel Corporation

File:     B-277660

Date:November 4, 1997

Thomas L. McGovern III, Esq., Hogan & Hartson, for the protester.
Timothy S. Kerr, Esq., Elliott, Reihner, Siedzikowski & Egan, for 
Control Products Corporation, an intervenor.
Stephen Stastny, Esq., Defense Logistics Agency, for the agency.
Peter A. Iannicelli, Esq., and Michael R. Golden, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Agency reasonably did not invite protester to compete for emergency 
contract to provide a relatively small quantity of instrument mounting 
bezels for use in helicopters until agency can make award of a 
contract for a large number of bezels pursuant to a competitive 
procurement where:  (1) bezels are critical to flying the helicopters 
safely; (2) agency had no bezels in its inventory and a large number 
of bezels were on back-order; (3) a number of helicopters were already 
grounded because of lack of bezels and more were expected to be 
grounded in the immediate future; (4) protester had never supplied 
these bezels to the agency and its bezels would, therefore, have to 
pass first article testing before the agency would consider them 
acceptable; and (5) in view of urgent circumstances, agency was 
unwilling to incur delay associated with first article testing and 
risk that the protester's bezels might not pass first article tests.

DECISION

Sun Dial and Panel Corporation protests the Defense Supply Center 
Richmond's (DSCR) issuance, on a sole-source basis, of purchase order 
No. SPO440-97-M-PP02 for instrument mounting bezels (national stock 
number 6695-01-342-3191)[1] to Control Products Corporation (CPC) 
pursuant to request for quotations No. SPO440-97-Q-TF20.[2]  The 
protester contends that the agency improperly did not solicit a 
quotation from it to fulfill the agency's urgent requirement for 
bezels even though the agency was aware that Sun Dial was interested 
in and fully qualified to manufacture the parts.

We deny the protest.      

On July 16, 1997, the DSCR inventory management section requested an 
emergency purchase of 63 bezels for use as part of the horizontal 
situation indicators in UH--60A "Blackhawk" helicopters.  The purchase 
request stated that the bezels were essential to the Blackhawk 
helicopter's mission and requested that every effort be made to obtain 
the fastest delivery possible.  That same day, a DSCR contract 
specialist contacted CPC and orally requested that CPC submit a 
quotation containing its best price and delivery terms for 63 bezels.  
CPC's initial quotation stated a price of $1,300 per unit with 
delivery of all units 160 days after receipt of an order (ARO).  The 
next day, the contract specialist orally requested that CPC provide 
faster delivery because some aircraft were already grounded.  CPC 
responded that it would commit to delivering all units 120 days ARO 
and that it would try to deliver 10 units sooner.  As CPC had 
previously supplied the bezels and had no record of any quality 
problems, the agency considered an award to CPC acceptable.  Citing 
the statutory authority of 10 U.S.C.  sec.  2304(c)(2) (1994)--the unusual 
and compelling urgency exception to the general statutory requirement 
for full and open competition--the contracting officer determined on 
July 17 that a sole-source award to CPC was justified.  On July 23, 
the agency issued a purchase order to CPC for 63 bezels at a total 
price of $81,900, and Sun Dial filed this protest shortly thereafter.

The protester contends that DSCR should have asked it to submit a 
quotation for the 63 urgently needed bezels.  The protester asserts 
that, even though cognizant agency personnel stated that this was an 
"emergency buy" necessitating a sole-source purchase from CPC, the 
agency was aware of Sun Dial's interest in supplying bezels because, 
at the time of the sole-source purchase from CPC, Sun Dial was (and 
still is) actively participating in another procurement for the same 
type of bezels that DSCR is presently conducting as a competitive 
procurement.[3]  The protester also asserts that the agency knew that 
Sun Dial was interested in and was capable of supplying quality bezels 
in a timely manner because the engineering support activity (i.e., the 
United States Army Communications-Electronics Command) had, in fact, 
determined that Sun Dial's bezels were acceptable on July 16, 1997, 
just 1 week before the purchase order was issued to CPC on a 
sole-source basis.

The Competition in Contracting Act (CICA) permits the use of 
noncompetitive procedures where the agency's need for the property or 
services is of such an unusual and compelling urgency that the United 
States would be seriously injured unless the agency is permitted to 
limit the number of sources from which it solicits proposals.  10 
U.S.C.  sec.  2304(c)(2).  While CICA requires the agency to request offers 
from as many potential sources as is practicable under the 
circumstances, 10 U.S.C.  sec.  2304(e), the agency may still limit the 
procurement to the only firm it reasonably believes can properly 
perform the work in the available time.  Electro-Methods, Inc., 
B-250931, Feb. 26, 1993, 93-1 CPD  para.  181 at 4.

In view of the circumstances existing at the time the purchase order 
was issued, DSCR reasonably determined that its immediate need for an 
interim quantity of bezels was of such an unusual and compelling 
urgency that an emergency, sole-source purchase from CPC was 
justified.  It is clear from the record, and undisputed by the 
protester, that DSCR had an urgent need for a relatively small 
quantity of bezels (i.e., 63 units) for use in Blackhawk helicopters 
until a larger quantity (i.e., 245 units) could be obtained by the 
agency pursuant to the competitive procurement and that bezels are 
critical to the Blackhawk helicopter's mission; the helicopter cannot 
be flown safely without them.[4]  The record shows that, at the time 
the purchase order was issued to CPC, DSCR had no bezels of this type 
in its inventory stock, 147 bezels were back-ordered, and DSCR 
expected more back-orders for bezels to accumulate quickly.  Of the 
147 bezels that were back-ordered, 35 were classified as issue 
priority group 1, which includes only the most urgently needed items.  
In fact, at the time the purchase order was issued, 
10 helicopters were already grounded due to the lack of any bezels in 
stock.[5]  Furthermore, based upon historical usage rates, the agency 
estimated that approximately 41 additional bezels would be needed 
during the 3-month period following the order from CPC.   

The protester questions the agency's requiring that its bezels pass 
first article testing before the agency will accept them, since the 
engineering support activity had conducted a review of its technical 
data package and determined that Sun Dial's bezel was an acceptable 
part for use in Blackhawk helicopters.  Our Office will not question 
an agency's determination that first article testing is required 
unless the determination is the result of bad faith or fraud, or there 
is a clear showing of abuse of discretion by the agency.  Brunswick 
Corp., Defense Div., B-231996, Oct. 13, 1988, 88-2 CPD  para.  349 at 6.  No 
such showing was made here.

The contemporaneous record shows that, subsequent to the engineering 
support activity's approving Sun Dial's bezel based on the technical 
data that Sun Dial submitted, the engineering support activity 
expressed a desire for DSCR to include a first article test 
requirement in the competitive RFP so that any manufacturer that had 
not previously manufactured this bezel would be required to prove that 
its product is acceptable.  In fact, the contracting officer reports 
that the approving engineer specifically told him that he approved Sun 
Dial's bezel with the expectation that it would be required to undergo 
first article testing and that he desired that the bezel be subjected 
to such testing.  Because the engineering support activity's approval 
of Sun Dial's drawing/engineering package was contingent upon the 
bezels passing first article testing, and because Sun Dial had never 
supplied this particular bezel to DSCR, we think the agency reasonably 
decided not to waive the first article test requirement on behalf of 
Sun Dial.    

Sun Dial contends that, even if its bezels were required to undergo 
first article testing, the agency should have solicited a quotation 
from it for the emergency buy, since, according to the protester, it 
could have completed production and testing of a first article and 
still have delivered all 63 bezels within 120 days ARO as required 
under the agency's accelerated delivery schedule.  The agency responds 
that, since Sun Dial had never supplied these bezels to it before, it 
could not be sure that Sun Dial's bezels would pass the first article 
tests.  In view of the critical need for these parts, the agency 
reports that it could not risk the additional delay that failure to 
pass first article tests would cause.  Notwithstanding a firm's claim, 
such as Sun Dial's here, that it can meet the leadtime required for 
first article testing of an urgently needed item, an agency is not 
obligated to take the risk that the product will not pass first 
article testing, since such a failure would delay delivery.  Rotair 
Indus., 69 Comp. Gen. 684, 688 (1990), 90-2 CPD  para.  154 at 5.  In view 
of its extremely urgent need for quick delivery of bezels, and because 
Sun Dial had never supplied these particular bezels before, the 
agency, reasonably in our opinion, was unwilling to incur the delay 
associated with first article testing and approval and the risk that 
Sun Dial's bezel would not pass first article tests. 

In sum, even though the engineering support activity had reviewed and 
approved Sun Dial as a qualified source for the bezels based upon the 
technical data package that Sun Dial had submitted to the agency in 
connection with the competitive procurement, DSCR reasonably decided 
that, for the emergency purchase, it would not consider a quotation 
from Sun Dial or any other firm that had not actually manufactured 
these bezels before.  Because this part is critical to the Blackhawk 
helicopter's ability to fly safely, and because a number of the 
helicopters were already grounded and others were expected to be 
grounded in the near future, we have no reason to question the 
agency's decision not to invite Sun Dial to compete for the interim, 
emergency purchase.  See BlueStar Battery Sys. Corp., B-270111.2, 
B-270111.3, Feb. 12, 1996, 96-1 CPD  para.  67 at 4-5.  

In its comments on the agency's report, Sun Dial raises a new protest 
ground--i.e., that the urgent need for the interim quantity of bezels 
was the direct result of a lack of advance planning on the agency's 
part.  Referring to the allegedly overlong period of time that had 
elapsed since the issuance of the competitive RFP, Sun Dial states:

     Examining the overall circumstances of this procurement--which 
     actually started in February 1996--it is clear that DSCR itself 
     created the urgency by wasting months of time (for no apparent 
     reason) in procuring these items. 

In support of this argument, Sun Dial points out that, at the time the 
purchase order was issued to CPC, DSCR had been in the process of 
conducting the competitive procurement for roughly 17 months and 
evaluating Sun Dial's bezel for roughly 16 months, and neither process 
had been completed.  In view of the fact that bezels are critical and 
that the lack of them eventually caused the grounding of some 
helicopters, the protester asserts that the agency should have done 
something to speed up either the competitive procurement or the 
product approval process.  This protest ground is untimely.  Sun Dial 
knew when it filed its initial protest that the agency had justified 
its sole-source award to CPC on the basis of urgency and, as Sun Dial 
had participated in the competitive procurement from its inception and 
submitted its data package for approval just 1 month later, Sun Dial 
also knew of the delays associated with the competitive procurement 
and product approval process.  Nevertheless, Sun Dial did not raise 
this issue in its initial protest but, instead, waited until it filed 
its comments on the agency report to raise this issue.  Because Sun 
Dial knew at the time of its initial protest filing that there 
appeared to be an inconsistency between the urgency of the sole-source 
award and the alleged dilatory nature of the agency's actions in 
conducting the competitive procurement and evaluation of Sun Dial's 
bezel, Sun Dial should have raised this issue in its initial protest.  
As Sun Dial waited more than 10 days after it should have known this 
protest basis to file this new protest ground, this protest ground is 
dismissed as untimely.  Bid Protest Regulations, 4 C.F.R.  sec.  21.2(a)(2) 
(1997); AT&T, B-251177, B-251177.2, Mar. 16, 1993, 93-1 CPD  para.  236 at 
5-6.

The protest is denied.

Comptroller General 
of the United States

1. Bezels are metal rims that hold the transparent covering of 
aircraft instruments in place; bezels protect and illuminate critical 
indicators on the aircraft's instrument panel.  

2. While this is the agency's designated solicitation number, the 
procurement was conducted orally and no written request for quotations 
was issued.

3. Request for proposals (RFP) No. SPO440-97-R-0843 was issued on 
February 21, 1996, using competitive procedures to purchase 245 of the 
same type of bezels with an option to increase the quantity up to 100 
percent of the original quantity.  Sun Dial submitted a proposal in 
response to this competitive RFP.  In connection with this competitive 
procurement, Sun Dial states that it used reverse engineering to 
produce a complete drawing/engineering package which it submitted to 
the agency in March 1996 in order to have its bezels qualified as 
acceptable alternates to the brand names listed in the RFP.  No award 
has been made to date. 

4. It is undisputed that bezels are critical to the safety of 
Blackhawk helicopters and those flying in them.

5. The number of grounded helicopters increased to 16 by August 1.