BNUMBER:  B-279622 
DATE:  July 2, 1998
TITLE: Metric Systems Corporation, B-279622, July 2, 1998
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Matter of:Metric Systems Corporation

File:     B-279622

Date:July 2, 1998

E. Bruce White Wolf, Esq., for the protester.
Joyce U. Ballack, Esq., for Harris Corporation, Government 
Communications Systems Division, an intervenor.
Todd E. Norton, Esq., Lawrence J. Feldhaus, Jerry W. Aldridge, and 
John E. Lariccia, Esq., Department of the Air Force, for the agency.
Tania Calhoun, Esq., and Christine S. Melody, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Although the Competition in Contracting Act of 1984 generally mandates 
that contracting agencies obtain full and open competition in their 
procurements through the use of competitive procedures, the proposed 
sole-source award of a contract under 10 U.S.C.  sec.  2304(c)(1) (1994) is 
unobjectionable where the agency reasonably determined that only one 
source could complete the modification of an electronic warfare system 
to simulate advanced threats within the urgent time constraints of the 
procurement.

DECISION

Metric Systems Corporation protests the Department of the Air Force's 
decision to award a sole-source contract to Harris Corporation, 
Government Communications Systems Division, to provide total system 
performance responsibility for the Miniature-Multiple Threat Emitter 
System (Mini-MUTES) Modification Program.  Metric argues that the Air 
Force unreasonably determined that Harris is the only source capable 
of meeting the agency's needs within the required time constraints.  

We deny the protest.

The Mini-MUTES system is a surface-to-air-missile threat radar 
simulator presently in place on Combat Air Forces training ranges.  
Each system typically consists of one Master Control Group (MCG) and 
up to five Remote Emitter Units (REU).  The REUs emit electronic 
signals that simulate different threat signal combinations to train 
pilots that might face the actual threats during combat, and the MCG 
directs and coordinates all REU activity occurring on the training 
ranges.

The Mini-MUTES system was initially produced by General Dynamics 
Corporation pursuant to a 1986 contract.  After a competition, Harris 
was awarded the follow-on production contract in 1990.  Harris has 
since added new threats to the system's capability and improved its 
reliability pursuant to various engineering change proposals under 
that original contract.  The Mini-MUTES system, whose current 
configuration uses a 1980s-vintage computer, was deemed obsolete in 
1993 because its central processor units (CPU) were outdated and its 
bus (the electronic pathway through which the REUs and the MCG 
communicate) was inadequate.  The Air Force lacked the funding to 
upgrade the system but continued to maintain and troubleshoot its 
outdated computer technology because it remained a viable simulator of 
low-level threats.  At the same time, the Air Force began exploring 
its options for obtaining the capability to train against advanced 
threats.  Beginning as early as 1995, and continuing through mid-1997, 
the agency commissioned advanced threat feasibility studies, explored 
joint initiatives with other military services, evaluated existing 
equipment and systems, and conducted informal market surveys with 
industry.    

In January 1997, the Defense Advanced Research Projects Agency (DARPA) 
announced its Dual Use Applications Program for the fiscal year 1997.  
Under the program's Commercial Operations and Support Savings 
Initiative (COSSI), contractors were asked to propose methods of 
inserting commercial technology into fielded military systems in order 
to lower the operations and support costs for such systems.  News 
Release, Dual Use Applications Program Plans Announced, Jan. 14, 1997.  
The DARPA solicitation supporting COSSI set forth a two-stage process.  
In the first stage, DARPA and the contractor were to share the costs 
of developing and testing prototype "kits" for the military customer 
for installation into a fielded system.  Assuming a successful first 
stage, the military customer's goal in the second stage of the process 
was to purchase reasonable production quantities of the kit at fair 
and reasonable prices and without recompetition.  Solicitation
No. 97-12 at 2, 3.  

Harris responded to the COSSI solicitation by submitting a proposal to 
replace the existing obsolete CPU and bus in the Mini-MUTE system with 
a commercial open architecture processor and bus system.  On May 5 the 
Air Force announced that Harris's proposal was one of six Air Force 
projects that had been awarded a DARPA grant.  News Release, Air Force 
Announces Operations and Support Projects, May 5, 1997.  Successful 
completion of this task will result in a processor that extends the 
life of the present Mini-MUTES system to the year 2015.  

At about this same time, the Air Force announced that the acquisition 
or development of an advanced threat system by September 2001 was one 
of its highest priorities.  Contracting Officer's Statement at 1.  The 
acquisition is considered to be urgent because pilots unable to train 
against advanced threats might face them for the first time during 
combat.  May 1997 Modification Proposal at 1.  All of the options 
disclosed by the agency's planning process--the acquisition of a new 
system, the modernization of the Mini-MUTES system, and the 
modernization of other existing systems--were presented to user 
commands.  For reasons not at issue here, the Air Force opted to 
modify the Mini-MUTES system.  

The Air Force was left to decide how to acquire the modification of 
the Mini-MUTES system.  As its January 1998 acquisition plan makes 
clear, the Air Force began its decision-making process by considering 
the effect that Harris's performance of two ongoing Mini-MUTES system 
research and development (R&D) efforts--its DARPA-sponsored 
replacement of the system's CPU and bus and its improvement of the 
REU's tracking capability under its original contract--would have on 
the modification program.  

The Air Force believed that a contractor could not modify the 
Mini-MUTES System to add advanced threat capability unless it 
understood the CPU and bus architecture, since additional system 
upgrades must be integrated with the new interface architecture to 
ensure that the system operates as a cohesive unit.  Harris was 
upgrading these systems pursuant to its DARPA agreement, and other 
contractors could only understand the upgraded architecture after 
reviewing the technical data associated with the upgrade.  However, 
Harris's agreement with DARPA provides that Harris will control the 
data rights to the upgraded architecture until the production phase of 
the effort in 2001.  Harris-DARPA Agreement at 13-14.  The data for 
Harris's tracking capability effort will be unavailable until 2001 as 
well.  Since the target date for obtaining initial operational 
capability for the modified Mini-MUTES system was also 2001, no 
contractor aside from Harris could provide the modifications within 
the required time constraints.  Acquisition Plan at 7, 10.

On January 18, 1998, in view of the ongoing R&D efforts and the 
limited technical data availability associated with each, the Air 
Force prepared a justification and approval (J&A) document for the 
sole-source award of the advanced threat upgrade contract to Harris 
which will give the firm total system performance responsibility for 
the modification program.  J&A at 2-3.  The J&A recounted the 
background described above and set forth three acquisition options 
considered by the Air Force.

The Air Force considered terminating the DARPA agreement--sacrificing 
the CPU and bus development undertaken by Harris in the 11 months 
since the COSSI solicitation was issued and surrendering the more than 
$2 million committed by DARPA and Harris to upgrade the system--and 
competing and funding the computer upgrade along with the advanced 
threat modification.  Id. at 3-4.  The Air Force decided that this 
course of action would "delay the R&D phase an estimated two years or 
more and result in additional costs of $2.5 million to duplicate the 
on-going development efforts that [Harris] is currently working under 
separate contracts."  Id.  The Air Force believed that the "complexity 
of the required Mini-MUTES modifications and their interfaces with 
on-going development would necessitate extensive pre-performance 
efforts by another contractor in order to establish a responsible 
development/production capability and an engineering support team.  
Based on [its] experience under previous Mini-MUTES modification 
development efforts, the estimated 'spin-up' time for another offeror 
would be 18 months from contract award."  Id. at 4.  Since the program 
funding profile and delivery requirements would not support delay in 
the schedule, the Air Force rejected this acquisition option.  Id.

The Air Force also considered honoring the DARPA agreement to permit 
Harris to develop and complete the CPU and bus upgrade, and then 
competing the advanced threat modification after the agency received 
the data rights to the new processor and bus.  The Air Force rejected 
this option because a validated reprocurement package would not be 
available until the completion of the Mini-MUTES Modification Program 
production phase,[1] and because "government property, including tools 
and test equipment necessary for the Mini-MUTES modifications 
development, [would] not be available for a competing contractor until 
the completion of on-going development efforts for the system computer 
replacement (i.e., FY01)."  Id.  The agency's timeline for this 
acquisition approach showed that initial operational capability would 
not be possible until 2006, well past the target date.

The Air Force finally considered awarding the advanced threat upgrade 
to Harris on a sole-source basis with concurrent development of the 
CPU and bus upgrade and the advanced threat modifications.  The J&A 
stated that Harris, the current Mini-MUTES manufacturer, had the 
necessary skills, equipment, and capabilities in-place to acomplish 
the required modifications.  In addition, Harris had extensive 
experience developing and producing modifications for the Mini-MUTES 
system.  As the Air Force's J&A explained, at 4: 

     The required Mini-MUTES modifications must not only integrate 
     with existing Mini-MUTES hardware and software, but interface 
     with the on-going computer replacement and tracking upgrade 
     efforts currently on-contract with [Harris].  Only [Harris] can 
     concurrently perform the required Mini-MUTES modifications with 
     on-going development of a system computer replacement and 
     tracking upgrades and meet the delivery requirements.  System 
     integration is the key risk area for the Mini-MUTES modification, 
     including integration of available advanced threat transmitter 
     technology.  [Harris] is best qualified to perform as the 
     responsible total system integrator. 
 
The proposed sole-source award was synopsized in the Commerce Business 
Daily (CBD) on February 11.  The notice described Harris's ongoing R&D 
efforts and explained that the reprocurement data containing the 
necessary interface documentation would not be available until 2001, 
the target year for initial operational capability of the modified 
system; considering these developments, providing Harris total system 
project responsibility would ensure a seamless integration of the new 
Mini-MUTES computer.  The CBD notice stated the Air Force would 
consider all proposals received within 20 days in order to determine 
whether to conduct a competitive procurement. 

On March 5, Metric filed an "objection and protest" of the proposed 
sole-source award with the Air Force.  Metric's letter asserted that 
Harris was not the only firm capable of providing the Air Force with 
the advanced threat modifications and briefly outlined its 
capabilities with respect to these modifications.  In a March 23 
response, the Air Force explained that the Mini-MUTES system was 
undergoing a development effort to remedy problems associated with an 
obsolete CPU and that Harris was the only source capable of concurrent 
development to enable the Air Force to satisfy its mission 
requirement.  The letter further explained that the Air Force could 
compete the advanced threat modifications alone, but if it did so it 
would have to integrate the advanced threat transmitters with the 
ongoing CPU and bus interface development in order to meet the mission 
requirement date; the government did not have the resources to act as 
an integrator.  After it received the Air Force's response Metric 
filed the instant protest.

Metric argues that sources other than Harris, including itself, are 
capable of providing the entire modification effort--the CPU and bus 
upgrade, the tracking upgrade, and the advanced threat 
modifications--and that the Air Force should have terminated Harris's 
ongoing efforts and held a competition for the entire modification 
program.  

In general, the overriding mandate of the Competition in Contracting 
Act is for "full and open competition" in government procurements, 
which is obtained through the use of competitive procedures.  10 
U.S.C.  sec.  2304(a)(1)(A) (1994).  The Air Force's justification for 
awarding this sole-source contract relies primarily upon the exception 
to full and open competition authorized by 10 U.S.C.  sec.  
2304(c)(1)--i.e., that there is only one source capable of meeting the 
agency's needs.[2]  Datacom, Inc.--Protests and Request for Costs, 
B-274175 et al., Nov. 25, 1996, 96-2 CPD  para.  199 at 6; Mnemonics, 
B-261476.3, Nov. 14, 1995, 96-1 CPD  para.  7 at 3.  To use noncompetitive 
procedures under 10 U.S.C.  sec.  2304(c)(1), the agency must execute a 
written J&A with sufficient facts and rationale to support the use of 
the specific authority, 10 U.S.C.  sec.  2304(f)(1)(A), (B); Federal 
Acquisition Regulation  sec.  6.302-1(d)(1); 6.303; 6.304, and publish a 
notice in the CBD to permit potential competitors to challenge the 
agency's intent to procure without full and open competition.  10 
U.S.C.  sec.  2304(f)(1)(C).  

Our review of an agency's decision to conduct a sole-source 
procurement focuses on the adequacy of the rationale and conclusions 
set forth in the J&A.  When the J&A sets forth reasonable 
justifications for the agency's actions, we will not object to the 
award.  Datacom, Inc.--Protests and Request for Costs, supra; AAI ACL 
Techs., Inc., B-258679.4, Nov. 28, 1995, 95-2 CPD  para.  243 at 5.  A 
sole-source award is justified where the agency reasonably concludes 
that only one known source can meet its needs within the required time 
except where the noncompetitive situation arises from a lack of 
advance procurement planning.  Space Vector Corp., B-253295.2, Nov. 8, 
1993, 93-2 CPD  para.  273 at 10.  We conclude that the Air Force reasonably 
determined that only Harris could satisfy its requirements for the 
advanced threats modification within the time required.[3]  See AAI 
ACL Techs., Inc., supra, at 7; Midwest Dynamometer & Eng'g Co., 
B-257323, Sept. 2, 1994,
94-2 CPD  para.  91 at 3.

The J&A contains the Air Force's express consideration and rejection 
of the course of action proposed by Metric.  The Air Force set forth 
two reasons for concluding that surrendering the funds and time 
invested in these projects was not a viable option.  First, building 
in the time required for another contractor to "spin-up" to Harris's 
achievements would jeopardize the Air Force's ability to meet the 
initial operational capability date of September 2001.  It would take 
as long as 18 months to prepare a current data package to give to 
other contractors, and at least this long for any other contractor to 
both match Harris's experience and capabilities with the Mini-MUTES 
system and duplicate its progress on the computer upgrade.  This 
additional time would necessarily extend the date for obtaining 
initial production capability.  Second, this course of action would 
result in significant additional costs to duplicate Harris's efforts.  
Since the advanced threat modifications had to be integrated with the 
computer upgrade, and since the documentation to ensure integration 
will be in the sole possession of Harris until 2001, the only 
contractor that could provide all of these efforts concurrently and 
still meet the 2001 target date was Harris. 

Metric does not dispute the fact that the advanced threat 
modifications must be integrated with the computer system upgrade, or 
that, under the circumstances, one contractor should be responsible 
for the entire effort.  Metric simply argues that that contractor need 
not be Harris.  Cast as a challenge to the Air Force's failure to 
terminate Harris's ongoing efforts and compete the entire modification 
program, Metric's protest actually challenges the Air Force's proposed 
sole-source award on two bases:  time and money.  

Metric disputes the Air Force's assertion that taking the protester's 
proposed course of action would jeopardize the schedule.  Metric 
generally discounts Harris's experience and capabilities, as well as 
the difficulty of its ongoing efforts, and claims that it could 
accomplish the entire effort prior to September 2001.  In its 
comments, Metric asserted that it could make initial delivery 24 
months after award.  May 8 Comments at 2.  Its supplemental comments 
backed away from that schedule and claimed that it could deliver 
initial operational capability a conservative 31 months after award.  
May 28 Supplemental Comments at 2.  Setting aside the realism of this 
proposed schedule, which the Air Force disputes,
31 months from the date of this decision's issuance, let alone the 
date of any future competitive award, is so close to the September 
2001 target date as to represent an obvious risk to the effort.  We do 
not believe the Air Force should have been required to jeopardize its 
ability to obtain the urgently required modifications based upon these 
unsupported promises, particularly when Harris's investment of 
substantial time and money will apparently enable the Air Force to 
meet its target date.       

Metric next asserts that the costs of duplicating Harris's efforts 
will be recovered through competition because it can perform the 
effort for $35-40 million, less than the $49 million estimated for 
Harris's sole-source effort.  Metric's argument that it would be 
cheaper for the agency in the long run to simply "redo" what it has 
already done is speculative; moreover, a protester cannot insist that 
an agency abandon an established approach to satisfying its needs in 
order to allow the protester to sell to the government.  Vorum 
Research Corp., B-255393, B-255394, Feb. 28, 1994, 94-1 CPD  para.  155 at 
3-4.  

As for Metric's claim that the Air Force "purposely overlooked" its 
abilities to perform the entire modification program, the information 
provided to the Air Force in Metric's March 5 letter did not describe 
any capabilities aside from those associated with the advanced threat 
modifications.  As a result, the Air Force reasonably determined that 
the information provided by Metric was inadequate to justify 
abandoning its planned course of action.  

The protest is denied.

Comptroller General
of the United States

1. The Air Force explains that the technical data package on the 
existing system has not been revised to reflect several field-level 
modifications, and the development of an up-to-date package on the 
existing system, even without consideration of the DARPA effort, would 
require as much as 18 months.  Air Force Response to Comments at 6-7.

2. The J&A cites as a second authority the exception authorized by 10 
U.S.C.  sec.  2304(c)(5), which applies where a statute expressly 
authorizes or requires that the procurement be made through a certain 
agency or from a specified source.  Since we conclude that the Air 
Force reasonably relied upon the authority in 10 U.S.C.  sec.  2304(c)(1) 
in making this sole-source award, we need not consider Metric's 
allegations with respect to the second cited authority.

3. As for Metric's assertion that basing the sole-source decision on 
Harris's ongoing performance of the DARPA project reflects an improper 
lack of advance procurement planning, the record is replete with 
evidence of detailed, long-term procurement planning.