The Navy rigged bids in its own favor last year when it considered proposals to use private labor to ship Navy cargo, a trade group for the U.S. shipping industry charged in a suit filed in federal court here yesterday.
Although the legal issue concerns only three tiny Navy-owned tankers in the Far East, the stakes could turn out to be much higher.
The Navy's Military Sealift Command (MSC) operates 129 fleet-support vessels at a cost of $2.5 billion per year, according to estimates by the Joint Maritime Congress, which filed the suit. The group says that the private sector could do the job far more cheaply, and that the Navy is blocking President Reagan's pledge to give the recession-idled maritime industry a piece of the action. Related story on Page A4
The suit, which seeks to reopen the bidding to operate the three tankers, alleges that the sealift command ran a "sham competitive procurement, in which MSC was the predetermined successful" bidder.
Capt. John Dewey, a spokesman for Secretary of the Navy John F. Lehman Jr., said legal papers had not been served on the Navy by yesterday evening and that "obviously we can't comment on something we don't have." White House officials also declined to comment.
According to the suit, Edwin L. Harper, assistant to the president for policy development, held a meeting at the White House on April 7, 1982, to expedite President Reagan's promise to transfer some cargo operations to the private sector.
On May 28, the suit says, the Navy solicited bids for firms to operate the tankers on an experimental basis. Nine companies, which the trade group says it cannot name, submitted bids by Sept. 13.
On Sept. 23, the sealift command announced that it had won the competition and that the government would continue to operate the tankers itself, at a cost of $28.5 million over five years. The lowest private bid was $44.9 million.
The complainant says the Navy's figures are based on an "arbitrary" and "capricious" evaluation process, in which the Navy rigged the outcome by:
* Neglecting to tell bidders that one tanker, which had severe leakage problems and was otherwise "in a state of serious disrepair," was going to be overhauled. The Navy used this knowledge to lower its projected operating costs, the lawsuit charges, while the commercial bidders could not.
* Requiring the bidders to assume that the vessels would be at sea 330 days each year, when, in fact, the three ships have averaged between 180 and 200 days in port. The complainant says this is a crucial issue, since the Navy pays sailors for their time both in port and at sea, while the private sector pays only for sailing time. The more the ships are in port, the greater the competitive advantage of the private sector.
* Claiming that the Navy uses 29 sailors per tanker, when, in fact, each has a crew of 36. This, and other "deceptive practices," the suit alleges, allowed the Navy to understate its projected costs.
* Requiring private bidders to insure themselves for certain claims, without including that cost in its own estimate.