FAA denies Wilcox protest

In the first major test of its self-styled Acquisition Management System (AMS) the Federal Aviation Administration this month denied a protest filed by Wilcox Electric Inc. against the award of a contract to Hughes Aircraft Co. for development of a satellite navigation system.

The protest stems from the FAA's decision in April to cancel the $475 million Wide Area Augmentation System (WAAS) contract with Wilcox and award it on a sole-source basis to Hughes a subcontractor on the program. WAAS will create a network of ground stations designed to make satellite positioning signals reliable enough for navigational use by aircraft.

The FAA held a hearing on the protest following the AMS guidelines a set of acquisition regulations the FAA established in April 1996 after Congress freed it from most government-wide regulations.According to the protest the FAA violated the AMS on multiple points including failure to make a public announcement of its intent to award a sole-source contract. The decision to go sole source lacked a "rational basis " Wilcox noted.

FAA administrator David Hinson denied the protest based on the recommendation of a third-party "special master" appointed by the agency's Office of Dispute Resolution for Acquisition.

The special master an arbitrator agreed to by both parties was Judge Martha DeGraff of the General Services Administration's Board of Contract Appeals. According to a "summary of recommendation" provided by the FAA DeGraff determined that the AMS gave the agency the latitude to proceed as it did.

For example Wilcox charged that the FAA failed to conduct "proper market analysis" prior to awarding the contract to Hughes. "The AMS does not contain a hard and fast requirement for a market analysis " DeGraff found. "The AMS states only that the FAA `should' conduct a market analysis and not that it `will' or `must' conduct an analysis."

The FAA also was well within its rights to announce the sole-source contract over the Internet after the award a public announcement "is not to serve as a sort of minisolicitation inviting vendors to respond " DeGraff found.

Wilcox has 60 days to file an appeal with the U.S. Court of Appeals. "We certainly believed we had presented a valid case for the protest " said Wayne Dohlman vice president of business development at Wilcox. "Right now we are assessing what options we have available to us and what we want to do next.