B-168434 (1), APR. 1, 1970

B-168434 (1), APR. 1, 1970

BUY AMERICAN ACT--APPLICABILITY--FEDERAL AID, GRANTS, ETC; TO STATES UNDER PROCUREMENT PARTIALLY FUNDED BY GRANT UNDER FEDERAL WATER POLLUTION ACT, PROTEST TO AWARD ON BASIS THERE WAS NO COMPLIANCE WITH BUY AMERICAN ACT AND THAT SPECIFICATIONS ARE RESTRICTIVE IS DENIED SINCE ACT DEFINES "PUBLIC USE" AS USE BY UNITED STATES AND ITEMS WERE FOR USE OF COUNTY SANITARY AUTHORITY, BUY AMERICAN ACT THUS APPEARING INAPPLICABLE; MOREOVER, RIGID PROCEDURE APPLICABLE TO FORMALLY ADVERTISED PROCUREMENTS DO NOT APPLY TO NON-FEDERAL PROCUREMENTS WHEREIN FEDERAL GOVERNMENT PARTICIPATES AS GRANTOR OF FUNDS TO PARTIALLY SUPPORT PROCUREMENTS EFFECTED BY LOCAL AGENCIES OR INSTITUTIONS. SEE COMP. GEN. DECS. CITED.

TO ELLIOTT COMPANY:

YOUR PROTEST AGAINST THE AWARD OF A CONTRACT (NO. 311) TO OTHER THAN YOUR CONCERN FOR CENTRIFUGAL AIR COMPRESSORS BY THE ALLEGHENY COUNTY (PENNSYLVANIA) SANITARY AUTHORITY WHICH IS BEING PARTIALLY FUNDED BY A GRANT MADE PURSUANT TO THE FEDERAL WATER POLLUTION CONTROL ACT, AS AMENDED, 33 U.S.C. 466 ET SEQ; HAS BEEN FORWARDED TO OUR OFFICE FOR REVIEW.

THE PROJECT CONSISTS OF THE CONSTRUCTION OF ADDITIONS AND ALTERATIONS NECESSARY FOR UPGRADING AN EXISTING 150 MGD WASTEWATER TREATMENT PLANT AND TO PROVIDE SECONDARY TREATMENT AND CHLORINATION FACILITIES. THE TOTAL ESTIMATED PROJECT COST ELIGIBLE FOR FEDERAL PARTICIPATION IS $46,365,000 AND THE FEDERAL GRANT PORTION IS $4,019,400. THE GOVERNMENT'S SOLE PARTICIPATION IN THIS PROJECT IS IN THE FORM OF A GRANT MADE BY THE FEDERAL WATER POLLUTION CONTROL ADMINISTRATION (FWPCA).

AN ATTACHMENT TO YOUR LETTER OF PROTEST PROVIDES THE FOLLOWING INFORMATION REGARDING THE BIDS RECEIVED FOR THIS PROCUREMENT:

BIDDER BID PRICE

BROWN-BOVERI $554,455.00

DRESSER 638,950.00

ELLIOTT COMPANY (2 STAGE) 994,960.00

ELLIOTT COMPANY (SINGLE STAGE) 600,730.00 THE DEPARTMENT OF THE INTERIOR HAS CONFIRMED THE ABOVE PRICES WITH REGARD TO THE BROWN-BOVERI AND ELLIOTT BIDS FOR THE TWO-STAGE COMPRESSORS. AWARD WAS MADE TO THE BROWN-BOVERI CORPORATION ON DECEMBER 13, 1969, AS THE LOW RESPONSIVE, RESPONSIBLE BIDDER.

A QUESTION HAS BEEN RAISED REGARDING THE APPLICABILITY OF THE BUY AMERICAN ACT, 47 STAT. 1520, AS AMENDED, 41 U.S.C. 10A-D, TO THIS PROCUREMENT. THE BUY AMERICAN ACT REQUIRES THAT ONLY SUCH MANUFACTURED ARTICLES AS HAVE BEEN "MANUFACTURED IN THE UNITED STATES SUBSTANTIALLY ALL FROM ARTICLES, MATERIALS, OR SUPPLIES MINED, PRODUCED, OR MANUFACTURED," IN THE UNITED STATES BE ACQUIRED "FOR PUBLIC USE" UNLESS THE HEAD OF THE AGENCY CONCERNED SHALL DETERMINE IT TO BE INCONSISTENT WITH THE PUBLIC INTEREST OR THE COST TO BE UNREASONABLE. THE TERM "PUBLIC USE" IS DEFINED IN 41 U.S.C. 10 (C) (B) AS MEANING "USE BY * * * THE UNITED STATES." COMP. GEN. 784 (1967).

OUR OFFICE RECENTLY CONSIDERED AN ANALOGOUS SITUATION IN B-163399, JULY 9, 1968. THAT CASE CONCERNED A PROCUREMENT WHICH WAS PARTIALLY FUNDED UNDER A GRANT MADE PURSUANT TO TITLE III OF THE NATIONAL DEFENSE EDUCATION ACT OF 1958. THE PROCURING ACTIVITY WAS AN EDUCATIONAL AGENCY OF THE STATE OF CALIFORNIA AND ONE OF THE ISSUES CONSIDERED WAS WHETHER THE BUY AMERICAN ACT WAS APPLICABLE TO THAT PROCUREMENT. OUR DECISION STATED THAT IN VIEW OF THE DEFINITION GIVEN TO THE TERM "PUBLIC USE" AND THE FACT THAT THE ITEMS BEING PROCURED WERE FOR USE BY AN EDUCATIONAL AGENCY OF THE STATE OF CALIFORNIA, IT APPEARED THAT THE PROVISIONS OF THE BUY AMERICAN ACT DID NOT APPLY. THIS RATIONALE IS EQUALLY APPLICABLE TO THIS CASE.

THE OTHER ISSUE CONCERNS WHETHER THE SPECIFICATIONS ARE UNNECESSARILY RESTRICTIVE. THE DRAWINGS REQUIRE TWO-STAGE COMPRESSORS. YOUR LETTER OF PROTEST STATES THAT AMERICAN MANUFACTURERS CAN FURNISH EITHER A SINGLE OR TWO-STAGE COMPRESSOR BUT THAT THE TWO-STAGE TYPE IS NOW RARELY BUILT BY AMERICAN MANUFACTURERS DUE TO ITS HIGH COST. IT IS URGED THAT THE SINGLE- STAGE UNITS CAN BE OBTAINED AT A LOWER PRICE AND THAT THESE UNITS CAN MAINTAIN HIGH EFFICIENCY AND PERFORMANCE LEVELS.

THE RATHER RIGID PROCEDURES APPLICABLE TO FORMALLY ADVERTISED PROCUREMENTS DO NOT APPLY TO NON-FEDERAL PROCUREMENTS WHEREIN THE FEDERAL GOVERNMENT PARTICIPATES MERELY AS A GRANTOR OF FUNDS TO PARTIALLY SUPPORT THE PROCUREMENTS WHICH ARE EFFECTED BY LOCAL AGENCIES OR INSTITUTIONS. SEE B-161570, JANUARY 29, 1968.

THE INFORMATION FURNISHED BY YOU REGARDING THE BIDS RECEIVED FOR THIS PROCUREMENT INDICATES THAT THE BID FROM BROWN-BOVERI WAS THE LOW ACCEPTABLE BID; CONSEQUENTLY, THERE DOES NOT SEEM TO BE ANY BASIS TO QUESTION THE AWARD TO THAT CONCERN. THE CONSULTING ENGINEERS TO THE ALLEGHENY COUNTY SANITARY AUTHORITY APPARENTLY DETERMINED THAT TWO STAGE COMPRESSORS WERE NECESSARY. WE HAVE NO EVIDENCE THAT THIS WAS AN ARBITRARY DECISION.

THE GRANT CONDITIONS, PROMULGATED PURSUANT TO SECTION 12 (A) OF THE FEDERAL WATER POLLUTION ACT, AS AMENDED, ARE SET FORTH IN 18 CODE OF FEDERAL REGULATIONS 601.26. WE HAVE BEEN ADVISED THAT THE GRANTEE HAS COMPLIED WITH THESE CONDITIONS; THAT THE COMMISSIONER HAS RECEIVED THE ASSURANCES REQUIRED BY 18 CODE OF FEDERAL REGULATIONS 601.27 (A) AND THAT THERE HAS BEEN COMPLIANCE WITH ALL OF THE OTHER REGULATIONS APPLICABLE TO THIS GRANT.