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B-146348, APR. 5, 1962

B-146348 Apr 05, 1962
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TO THE WILKINSON MANUFACTURING COMPANY: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 2. IN YOUR LETTER YOU INVITE ATTENTION TO THE FACT THAT "THE NEW YORK ORDNANCE DISTRICT CERTIFIED THAT REDM CORPORATION WOULD PERFORM 51 PERCENT OF THE WORK IN THEIR PLANT" AND THIS CERTIFICATION WAS NECESSARY TO QUALIFY THE CORPORATION UNDER THE PROCUREMENT WHICH WAS SET ASIDE FOR SMALL BUSINESS. YOU STATE THAT THIS CERTIFICATION WAS ERRONEOUS AND THIS HAS NOW BEEN CONFIRMED BY THE FACT THAT R.E.D.M. AS YOU WERE ADVISED IN OUR LETTER OF FEBRUARY 15. WE HAVE RECEIVED A REPORT FROM THE OFFICE. WHICH IS IN PERTINENT PART AS FOLLOWS: "THE FOLLOWING FACTS ARE PROVIDED WHICH INDICATED THAT THE AFOREMENTIONED STATEMENTS ARE INCORRECT: "1.

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B-146348, APR. 5, 1962

TO THE WILKINSON MANUFACTURING COMPANY:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 2, 1962, IN REGARD TO THE AWARD OF A CONTRACT TO THE R.E.D.M. COMPETITION ON JUNE 29, 1961, UNDER INVITATION FOR BIDS NO. ORD-11-173-61-22.

IN YOUR LETTER YOU INVITE ATTENTION TO THE FACT THAT "THE NEW YORK ORDNANCE DISTRICT CERTIFIED THAT REDM CORPORATION WOULD PERFORM 51 PERCENT OF THE WORK IN THEIR PLANT" AND THIS CERTIFICATION WAS NECESSARY TO QUALIFY THE CORPORATION UNDER THE PROCUREMENT WHICH WAS SET ASIDE FOR SMALL BUSINESS. YOU STATE THAT THIS CERTIFICATION WAS ERRONEOUS AND THIS HAS NOW BEEN CONFIRMED BY THE FACT THAT R.E.D.M. HAS SUBCONTRACTED 65 PERCENT OF THE DOLLAR VOLUME OF THE CONTRACT TO BIG BUSINESS.

AS YOU WERE ADVISED IN OUR LETTER OF FEBRUARY 15, 1962, WE REQUESTED A REPORT OF THE FACTS AND CIRCUMSTANCES INVOLVED IN THE ALLEGEDLY IMPROPER CERTIFICATION BY THE NEW YORK ORDNANCE DISTRICT OF R.E.D.M. AS A SMALL BUSINESS CONCERN AND THE ALLEGEDLY IMPROPER SUBCONTRACTING BY R.E.D.M. IN REPLY TO OUR REQUEST, WE HAVE RECEIVED A REPORT FROM THE OFFICE, CHIEF OF ORDNANCE, WHICH IS IN PERTINENT PART AS FOLLOWS:

"THE FOLLOWING FACTS ARE PROVIDED WHICH INDICATED THAT THE AFOREMENTIONED STATEMENTS ARE INCORRECT:

"1. A DETERMINATION WAS MADE BY THE ORDNANCE AMMUNITION COMMAND, ON THE BASIS OF A PRE-AWARD SURVEY BY THE NEW YORK ORDNANCE DISTRICT, THAT THE R.E.D.M. CORPORATION:

"A. QUALIFIED AS A MANUFACTURING SOURCE OF SUPPLY UNDER ARMED SERVICES PROCUREMENT REGULATION 1-201.18.

"B. QUALIFIED FOR AWARD AS A SMALL BUSINESS SOURCE SINCE IT EMPLOYED LESS THAN 100 PERSONS.

"2. IN QUALIFYING FIRMS FOR PREFERENTIAL TREATMENT AS SMALL BUSINESSES UNDER SET ASIDE PROCEDURES, THE PERCENTAGE OF WORK SUBCONTRACTED, WHETHER TO LARGE OR SMALL BUSINESS, IS NOT PERTINENT SO LONG AS THE END ITEM BEING PROCURED, IS MANUFACTURED BY SMALL BUSINESS. SUCH END ITEM MANUFACTURE COULD CONSIST OF AN ASSEMBLY OPERATION.

"3. PERCENTAGES ARE PERTINENT, HOWEVER, IN DETERMINING ELIGIBILITY FOR LABOR SURPLUS AREA PREFERENCE. IN THE CASE UNDER REVIEW, THERE IS NO QUESTION OF LABOR SURPLUS PREFERENCE. THIS OFFICE DOES NOT, THEREFORE, CONTEMPLATE TAKING ANY FURTHER ACTION IN THIS MATTER.'

IN ADDITION TO THE FACTS THUS REPORTED, WE WISH TO STATE THAT WE FIND NOTHING TO CONTRADICT THE FINDING OF THE ADMINISTRATIVE OFFICE THAT R.E.D.M. IS A MANUFACTURER RATHER THAN A DEALER OR NONMANUFACTURER. ALSO, IT MAY BE ADDED THAT WE ARE NOT AWARE OF ANY REGULATION WHICH RESTRICTS A MANUFACTURER IN ORDER TO QUALIFY AS A SMALL BUSINESS CONCERN--- ASIDE FROM THE LABOR SURPLUS AREA PREFERENCE -- IN THE PERCENTAGE OF WORK SUBCONTRACTED TO BIG BUSINESS OR SMALL BUSINESS.

ACCORDINGLY, WE FIND NO BASIS FOR CHANGING OUR CONCLUSION HERETOFORE REACHED IN THIS MATTER.

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