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GAO Dismisses Some, Not All of Tanker Protest

CNBC has learned the Government Accountability Office will continue to consider part of a protest in the Air Force tanker refueling competition filed by a small U.S. company proposing a Ukrainian based tanker.

However, the GAO is dismissing the most serious accusations made by the firm, U.S. Aerospace, which claim the Air Force engaged in intentional misconduct.

U.S. Aerospace filed two separate protests after the Air Force said its tanker bid was submitted five minutes past a deadline on July 9.

The company claims its messenger arrived at Wright-Patterson Air Force Base an hour before the deadline, but Air Force officials kept him waiting and gave him confusing directions. The company alleges that Air Force personnel destroyed or did not preserve evidence showing when the messenger arrived, and it's even accused a contracting officer of lying about the incident, all because U.S. Aerospace believes the Air Force did not want to accept a bid involving a Ukrainian tanker.

Even so, U.S. Aerospace says the bid was actually delivered before the deadline.

It has demanded through the GAO that the Air Force turn over base logs, security video, and even the competing bids from Boeing and EADS.

The GAO refused.

The government watchdog agency also dismissed the most serious claims—that Air Force officials lied or intentionally acted improperly. "We find insufficient support for the allegations of intentional agency misconduct," reads the GAO decision. "We note that it was USAI's decision—not that of the Air Force—to have the messenger delivering its proposal arrive at the entrance to Wright-Patterson AFB less than an hour before proposals were due." What's more, "Without some relevant support, beyond mere speculation, for the protester's allegations of bad faith on the part of the agency, we will not develop, nor seek production of documents related to, these protest allegations."

However, the rest of the protest continues.

The GAO will consider U.S. Aerospace's claims that, in fact, its bid was actually delivered on time, and even if it was a few minutes late, it should still be considered, as "acceptance would not unduly delay the procurement". A decision on those protests will come no later than November 5, one week before the Air Force had been planning to announce a winner in the tanker contract.

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