B-161858, OCTOBER 11, 1967, 47 COMP. GEN. 192

B-161858: Oct 11, 1967

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NOT TO REQUIRE PAYMENT OF DAVIS-BACON ACT WAGE RATES IN THE PERFORMANCE OF A REACTOR SYSTEM ASSEMBLY FOR THE LOSS OF FLUID TEST (LOFT) EXPERIMENT ON THE BASIS "LOFT" WILL NOT BE ASSEMBLED ON THE SITE OF A PROPOSED CONTAINMENT AND CONTROL FACILITY. THE ASSEMBLY WORK IS NOT SUBJECT TO THE ACT. WILL NOT BE DISTURBED. THE INTERPRETATION OF ITS REGULATIONS THAT THE ASSEMBLY WORK IS NOT "CONSTRUCTION WORK" OR A "PUBLIC WORK. " BUT EXPERIMENTAL WORK IS AUTHORITATIVE. ABSENT A REASON FOR THE DEPARTMENT OF LABOR HOLDING THAT THE FACT THE REACTOR IS PART OF A MOBILE SYSTEM TO BE USED FOR EXPERIMENTAL WORK DOES NOT REMOVE ITS ASSEMBLY AND FABRICATION FROM THE COVERAGE OF THE DAVIS-BACON ACT. AT/10-1/-1230 BY IDAHO NUCLEAR CORPORATION (INC) AT THE AEC NATIONAL REACTOR TESTING STATION (NRTS) IN IDAHO IS OF SUCH NATURE AS TO COME WITHIN THE COVERAGE OF THE DAVIS-BACON ACT.

B-161858, OCTOBER 11, 1967, 47 COMP. GEN. 192

CONTRACTS - LABOR STIPULATIONS - DAVIS-BACON ACT - APPLICABILITY - CRITERIA THE DETERMINATION PURSUANT TO ATOMIC ENERGY COMMISSION REGULATIONS, IMPLEMENTING THE FEDERAL PROCUREMENT REGULATIONS, NOT TO REQUIRE PAYMENT OF DAVIS-BACON ACT WAGE RATES IN THE PERFORMANCE OF A REACTOR SYSTEM ASSEMBLY FOR THE LOSS OF FLUID TEST (LOFT) EXPERIMENT ON THE BASIS "LOFT" WILL NOT BE ASSEMBLED ON THE SITE OF A PROPOSED CONTAINMENT AND CONTROL FACILITY, NOR BE INSTALLED IN THAT BUILDING AND, THEREFORE, NOT CONSTITUTING CONSTRUCTION OF A CONVENTIONAL REACTOR, THE ASSEMBLY WORK IS NOT SUBJECT TO THE ACT, WILL NOT BE DISTURBED, THE COMMISSION HAVING THE RESPONSIBILITY OF ADMINISTERING AND ENFORCING THE CONTRACTS, THE INTERPRETATION OF ITS REGULATIONS THAT THE ASSEMBLY WORK IS NOT "CONSTRUCTION WORK" OR A "PUBLIC WORK," BUT EXPERIMENTAL WORK IS AUTHORITATIVE, ABSENT A REASON FOR THE DEPARTMENT OF LABOR HOLDING THAT THE FACT THE REACTOR IS PART OF A MOBILE SYSTEM TO BE USED FOR EXPERIMENTAL WORK DOES NOT REMOVE ITS ASSEMBLY AND FABRICATION FROM THE COVERAGE OF THE DAVIS-BACON ACT. ED TO THE SECRETARY OF LABOR FOR HIS INFORMATION.

TO THE CHAIRMAN, ATOMIC ENERGY COMMISSION, OCTOBER 11, 1967:

WE REFER TO A LETTER DATED JUNE 19, 1967, FROM THE GENERAL MANAGER, ATOMIC ENERGY COMMISSION, REQUESTING OUR DECISION AS TO WHETHER WE WOULD TAKE OBJECTION TO THE INCLUSION IN AEC CONTRACTS FOR THE PERFORMANCE OF REACTOR SYSTEM ASSEMBLY FOR THE LOSS OF FLUID TEST (LOFT) EXPERIMENT, OF PROVISIONS REQUIRING THE PAYMENT OF WAGES AT RATES DETERMINED BY THE SECRETARY OF LABOR PURSUANT TO THE DAVIS-BACON ACT, 40 U.S.C. 276A. THE GENERAL MANAGER'S REQUEST FOR A DECISION ON THIS MATTER STEMS FROM AN OPINION BY THE SOLICITOR OF LABOR (DB-52, OCTOBER 14, 1966), AFFIRMED BY THE WAGE APPEALS BOARD (67-6, APRIL 8, 1967), TO THE EFFECT THAT CERTAIN ASSEMBLY WORK IN CONNECTION WITH THE AEC LOFT EXPERIMENT TO BE PERFORMED UNDER CONTRACT NO. AT/10-1/-1230 BY IDAHO NUCLEAR CORPORATION (INC) AT THE AEC NATIONAL REACTOR TESTING STATION (NRTS) IN IDAHO IS OF SUCH NATURE AS TO COME WITHIN THE COVERAGE OF THE DAVIS-BACON ACT.

THE BACKGROUND FACTS AND CIRCUMSTANCES INVOLVED IN THE CONTROVERSY ARE DESCRIBED IN A MEMORANDUM SUBMITTED BY THE AEC TO THE SOLICITOR OF LABOR BY LETTER DATED SEPTEMBER 27, 1966, AS FOLLOWS: I. PURPOSE OF LOSS OF FLUID EXPERIMENT THE LOSS OF FLUID TEST EXPERIMENT (LOFT) IS AN ENGINEERING TEST PROGRAM TO INVESTIGATE AND DETERMINE THE CONSEQUENCES OF AN ACCIDENTAL LOSS-OF-COOLANT FLUID IN A NUCLEAR REACTOR. THIS PROGRAM IS A PART OF THE AEC NUCLEAR SAFETY ENGINEERING AND RESEARCH TEST PROGRAM. THE ESSENTIAL ELEMENT OF THE EXPERIMENTAL TEST IS TO WITHDRAW COOLANT FLUID UNDER CONTROLLED CONDITIONS WHICH WILL RESULT IN THE BURN-UP OF THE REACTOR CORE, THEREBY RESULTING IN THE PROBABLE DESTRUCTION OF THE REACTOR. THE PURPOSE OF THE LOFT EXPERIMENT IS TO GAIN KNOWLEDGE OF WHAT HAPPENS DURING THE COOLANT WITHDRAWAL PERIOD AND THE END RESULT TO THE REACTOR AND ITS COMPONENTS AFTER "BURN-UP.' II. DESCRIPTION AND LOCATION OF WORK TO BE PERFORMED A. REACTOR SYSTEM THE REACTOR SYSTEM WILL BE MOUNTED ON TWO RAILROAD FLAT CARS WHICH WILL BE CONNECTED END TO END. THIS SYSTEM WILL CONSIST OF THE FOLLOWING MAJOR COMPONENTS; REACTOR VESSEL, REACTOR CORE, STEAM GENERATOR, PRESSURIZERS, PRIMARY PUMPS AND PIPING, AND INSTRUMENTATION. THE MAJOR COMPONENTS LISTED ABOVE WILL BE PROCURED FROM A NUMBER OF MANUFACTURING FIRMS THROUGHOUT THE UNITED STATES, AND WILL BE ASSEMBLED IN AN EXISTING FACILITY AT NRTS, KNOWN AS BUILDING 607. THIS BUILDING WAS CONSTRUCTED APPROXIMATELY EIGHT YEARS AGO IN CONNECTION WITH THE AEC PROGRAM FOR AIRCRAFT NUCLEAR PROPULSION (ANP). IT IS A LARGE BUILDING OF HIGH BAY CONSTRUCTION CONTAINING A MACHINE SHOP, CARPENTRY SHOP, PAINT SHOP, ELECTRONIC SHOP, C., IN WHICH VARIOUS MANUFACTURING, FABRICATION, AND ASSEMBLY WORK HAS BEEN PERFORMED SINCE ITS INITIAL CONSTRUCTION. THE DIRECT LABOR COST ESTIMATED FOR THIS WORK IS $200,000. B. CONTAINMENT FACILITY THE CONTAINMENT FACILITY WILL CONSIST OF: A CONTAINMENT BUILDING, A REMOTE CONTROL ROOM, 1,300 FEET OF ADDITIONAL FOUR-TRACK RAILROAD LEADING INTO THE CONTAINMENT BUILDING. THE CONTAINMENT FACILITY WILL BE LOCATED ADJACENT TO EXISTING FACILITIES WHICH WERE CONSTRUCTED DURING THE ANP PROGRAM KNOWN AS THE FLIGHT ENGINEERING TEST FACILITY (FET). THE CONTAINMENT BUILDING WILL BE A LARGE BUILDING CAPABLE OF WITHSTANDING THE PRESSURES ASSOCIATED WITH COOLANT EXPULSION AND OF PREVENTING FISSION PRODUCT LEAKAGE TO UNCONTROLLED ATMOSPHERE. THERE WILL BE A CONSIDERABLE AMOUNT OF STRUCTURAL STEEL FRAMING AND CONCRETE FOUNDATION WORK. UTILITIES WILL BE PROVIDED TO THE BUILDING, AND 1,300 FEET OF RAILROAD TRACK WILL BE LAID FROM A TAKE-OFF POINT OF AN EXISTING TRACK. THE REMOTE CONTROL ROOM WILL BE A MODIFICATION OF A PORTION OF AN EXISTING BUILDING, A PART OF THE FET. THE DIRECT LABOR COST ESTIMATED FOR THIS WORK IS $3.1 MILLION. III. HOW WORK TO BE PERFORMED A. REACTOR SYSTEM THE REACTOR SYSTEM, AS DESCRIBED IN IIA. ABOVE, WILL BE ASSEMBLED IN THE 607 BUILDING BY PHILLIPS PETROLEUM COMPANY (PHILLIPS) AND IDAHO NUCLEAR COMPANY (INC) UNDER EXISTING CONTRACTS WITH THE AEC AS WORK WHICH IS NOT SUBJECT TO THE DAVIS-BACON ACT. THOSE EMPLOYEES OF PHILLIPS AND INC REPRESENTED BY A COLLECTIVE BARGAINING AGENT ARE REPRESENTED BY THE OIL, CHEMICAL, AND ATOMIC WORKERS. B. CONTAINMENT FACILITY THE CONTAINMENT FACILITY, AS DESCRIBED IN IIB. ABOVE, WILL BE CONSTRUCTED BY THE M.W. KELLOGG COMPANY UNDER AN EXISTING CONTRACT WITH THE AEC AS WORK WHICH IS SUBJECT TO THE DAVIS-BACON ACT. THOSE EMPLOYEES OF KELLOGG REPRESENTED BY COLLECTIVE BARGAINING AGENTS ARE REPRESENTED BY THE BUILDING AND CONSTRUCTION TRADES. IV. ISSUE THE MATTER IN ISSUE IS WHETHER THE WORK DESCRIBED IN IA. ABOVE (ASSEMBLY OF THE REACTOR SYSTEM), TO BE PERFORMED BY PHILLIPS AND INC, IS WORK SUBJECT TO THE DAVIS-BACON ACT. * * * V. AEC DETERMINATION OF COVERAGE DETERMINATION AS TO THE APPLICATION OF THE DAVIS-BACON ACT TO AEC CONTRACT WORK PERFORMED AT NRTS IS A FUNCTION DELEGATED BY THE GENERAL MANAGER OF THE AEC TO THE MANAGER OF THE AEC IDAHO OPERATIONS OFFICE. IN 1963 THE MANAGER, IDAHO OPERATIONS OFFICE, DETERMINED THAT THE ASSEMBLY OF THE REACTOR SYSTEM, WORK DESCRIBED IN IIA. ABOVE, WAS NOT WORK SUBJECT TO THE DAVIS-BACON ACT AND THAT THE CONSTRUCTION OF THE CONTAINMENT FACILITY, WORK DESCRIBED IN IIB. ABOVE, WAS WORK SUBJECT TO THE DAVIS-BACON ACT. THIS DETERMINATION WAS MADE AFTER STUDY AND RECOMMENDATION BY THE IDAHO DAVIS-BACON COMMITTEE CONSONANT WITH AEC PROCUREMENT REGULATIONS 9 12.4. IN JUNE 1966, AEC HEADQUARTERS REVIEWED THE WORK IN QUESTION AND THE BASIS OF THE DETERMINATION BY THE IDAHO MANAGER AND CONCURRED IN THAT DETERMINATION. THE AEC IDAHO DAVIS-BACON COMMITTEE IS COMPOSED EXCLUSIVELY OF AEC EMPLOYEES OF LONG EXPERIENCE IN THE FIELD OF CONSTRUCTION AND WITH THE AEC DAVIS-BACON CRITERIA. EACH AEC DAVIS BACON DETERMINATION IS BASED UPON COMPREHENSIVE KNOWLEDGE OF THE FACTUAL SITUATION INVOLVED AND CAREFUL APPLICATION OF THE AEC CRITERIA AND OTHER APPROPRIATE GUIDES. THE DETERMINATION IN QUESTION HERE RECEIVED VERY CAREFUL ATTENTION. THIS DETERMINATION IS HISTORICALLY CONSISTENT WITH ALL PRIOR WORK OF THIS NATURE AT NRTS AND IS NOT A DEPARTURE OR EXTENSION OF THE APPLICATION OF THE AEC CRITERIA. VI. DETAILED DESCRIPTION OF WORK DETERMINED AS NON- COVERED ALL OF THE FOLLOWING DESCRIBED WORK WITH THE EXCEPTION OF THE COLD TESTS (NON NUCLEAR CORE TESTS) AND THE HOT TEST (NUCLEAR CORE TESTS), WHICH ARE THE FINAL STEPS IN THE EXPERIMENT, WILL BE PERFORMED IN THE 607 BUILDING. UPON PROCUREMENT AND RECEIPT OF THE REACTOR PRESSURE VESSEL, IT WILL BE SET ON A CRADLE WHICH WILL BE FABRICATED IN THE MACHINE AND SHEET METAL SHOPS. AFTER PLACEMENT OF THE REACTOR VESSEL, INSTRUMENT ACCESS NOZZLES WILL BE WELDED INTO PLACE. THE VESSEL WILL THEN BE HYDROSTATICALLY TESTED UP TO 3500 P.S.I. ASSUMING SATISFACTORY COMPLETION OF THE HYDROSTATIC TEST, THE EXTERIOR OF THE VESSEL WILL BE EXTENSIVELY INSTRUMENTED. FOLLOWING INSTALLATION OF INSTRUMENTATION THE REACTOR VESSEL WILL BE INSULATED. INSULATION WILL BE INSTALLED WHILE THE REACTOR VESSEL IS SETTING ON ITS CRADLE. SHIELDING CONSISTING OF WATER AND LEAD WILL THEN BE PLACED AROUND THE REACTOR VESSEL. WHILE THE WORK DESCRIBED ABOVE IS BEING CARRIED OUT, THE TWO RAILROADS CARS WILL BE FITTED TOGETHER AND A SECOND CRADLE WILL BE FABRICATED AND ASSEMBLED ON THE RAILROAD CARS FOR RECEIPT OF THE REACTOR VESSEL. THE TWO RAILROAD CARS (DOLLY) WILL THEN BE INSTRUMENTED. IN ORDER TO LIFT THE PRESSURE VESSEL AND SHIELDING AS A UNIT, A SUPPORT STRUCTURE WILL BE DESIGNED AND FABRICATED TO ACCOMMODATE THE LIFTING AND MOVEMENT OF THE VESSEL ONTO THE DOLLY. THE VESSEL WILL THEN BE LIFTED BY OVERHEAD CRANES ONTO THE DOLLY. SUBSEQUENTLY, THE FRAMING, PIPING, AND ADDITIONAL INSTRUMENTATION WILL BE PLACED UPON THE DOLLY AND REACTOR VESSEL. CONCURRENTLY WITH THE ABOVE DESCRIBED OPERATIONS, THE REACTOR INTERNALS WILL BE ASSEMBLED, MEASURED, AND TESTED FOR INSTALLATION IN THE VESSEL. UPON INSTALLATION, FURTHER EXTENSIVE INSTRUMENTATION WILL BE MADE. AT THIS POINT THE "REACTOR SYSTEM" WILL BE MOVED FROM THE COLD ASSEMBLY AREA OF THE 607 BUILDING INTO THE HOT SHOP AREA WHERE REMOTE HANDLING EQUIPMENT WILL SIMULATE A DISASSEMBLY OF THE REACTOR SYSTEM TO TEST WHETHER THE REMOTE CONTROL EQUIPMENT CAN COPE (I.E., TAKE APART) WITH THE GEOMETRIC CONFIGURATION OF THE ASSEMBLY. IF IT CANNOT, THE REACTOR SYSTEM WILL BE RETURNED TO THE COLD ASSEMBLY AREA OF THE 607 BUILDING, DISASSEMBLED, AND MODIFIED. WHEN THE REACTOR SYSTEM'S ASSEMBLED CONFIGURATION MEETS THE DISASSEMBLY REQUIREMENTS, IT WILL BE MOVED ON THE DOLLY THE ONE AND A QUARTER (1-1/4) MILES INTO THE CONTAINMENT BUILDING WHERE IT WILL BE PLUGGED INTO UTILITIES AND INSTRUMENTATION CONTAINED IN THE REMOTE CONTROL BUILDING. NUMBER OF COLD TESTS WITH A NON-NUCLEAR CORE WILL BE PERFORMED. IF THESE TESTS SHOW ANYTHING WRONG WITH THE MATERIALS, WORKMANSHIP, OR DESIGN, THE SYSTEM WILL BE UNPLUGGED, AND RETURNED TO THE 607 BUILDING FOR CORRECTION. ULTIMATELY THE SYSTEM WILL BE IN PROPER CONDITION FOR THE NUCLEAR TEST IN THE CONTAINMENT BUILDING. AFTER THE NUCLEAR TEST, THE "BURNED OUT" REACTOR AND DOLLY WILL BE PARTIALLY DECONTAMINATED, UNPLUGGED, AND MOVED BACK TO THE HOT SHOP IN THE 607 BUILDING, WHERE THE REACTOR WILL BE DISASSEMBLED AND THE EFFECTS OF THE TEST STUDIED.

PERTINENT FEDERAL PROCUREMENT REGULATIONS DEFINING THE APPLICABILITY OF THE DAVIS-BACON ACT ARE AS FOLLOWS: 1-12.402 APPLICABILITY.

THE REQUIREMENTS OF THIS SUBPART 1-12.4 APPLY TO CONTRACTS FOR CONSTRUCTION, AND, UNDER SOME CIRCUMSTANCES, TO OTHER TYPES OF CONTRACTS INVOLVING CONSTRUCTION. 1-12.402-1 CONSTRUCTION CONTRACTS.

(A) A CONTRACT IS FOR CONSTRUCTION IF IT IS SOLELY OR PREDOMINANTLY FOR CONSTRUCTION, ALTERATION, OR REPAIR (INCLUDING PAINTING AND DECORATING) OF A PUBLIC BUILDING OR PUBLIC WORK. THE APPROPRIATE CLAUSES SET FORTH IN THIS SUBPART 1-12.4 SHALL BE INCLUDED IN SUCH CONTRACTS * * *.

(1) THESE REQUIREMENTS ARE APPLICABLE ONLY IF THE CONSTRUCTION WORK IS, OR REASONABLY CAN BE FORESEEN TO BE, PERFORMED AT A PARTICULAR SITE, SO THAT WAGE RATES CAN BE OBTAINED FOR THE LOCALITY (SEE SEC. 1 12.404-2).

(2) THESE REQUIREMENTS ARE NOT APPLICABLE TO CONTRACTS FOR THE CONSTRUCTION OR REPAIR OF VESSELS, AIRCRAFT, OR OTHER KINDS OF PERSONAL PROPERTY.

(3) THESE REQUIREMENTS ARE NOT APPLICABLE TO CONTRACTS REQUIRING CONSTRUCTION WORK WHICH IS SO CLOSELY RELATED TO RESEARCH, EXPERIMENT, AND DEVELOPMENT THAT IT CANNOT BE PERFORMED SEPARATELY, OR WHICH IS ITSELF THE SUBJECT OF RESEARCH, EXPERIMENT, OR DEVELOPMENT.

(4) THESE REQUIREMENTS ARE APPLICABLE TO THE MANUFACTURE OR FABRICATION OF CONSTRUCTION MATERIALS AND COMPONENTS ON THE SITE BY A CONSTRUCTION CONTRACTOR OR SUBCONTRACTOR UNDER A CONTRACT OTHERWISE SUBJECT TO THESE REQUIREMENTS, BUT ARE NOT APPLICABLE TO MANUFACTURING OR FURNISHING OF EQUIPMENT, COMPONENTS, OR OTHER MATERIALS.

(B) UNDER SUCH CONTRACTS FOR CONSTRUCTION, THE REQUIREMENTS APPLY ONLY TO WORK PERFORMED BY MECHANICS AND LABORERS AT THE SITE OF THE WORK.

(1) MECHANICS AND LABORERS ARE THOSE WORKING PREDOMINANTLY WITH THEIR HANDS OR WITH CONSTRUCTION TOOLS AND EQUIPMENT. THE REQUIREMENTS DO NOT APPLY TO OFFICE WORKERS, SUPERINTENDENTS, TECHNICAL ENGINEERS, OR SCIENTIFIC WORKERS, BUT THEY DO APPLY TO COOKS, STOREKEEPERS AND WORKING FOREMEN. THE REQUIREMENTS APPLY TO MECHANICS AND LABORERS WHETHER THEY ARE EMPLOYED BY THE PRIME CONTRACTOR OR BY A SUBCONTRACTOR OF ANY TIER.

(2) THE SITE OF THE WORK MAY INCLUDE THE SITES OF THE JOB HEADQUARTERS, STORAGE YARDS, PREFABRICATION OR ASSEMBLY YARDS, QUARRIES OR BORROW PITS, BATCH PLANTS, AND SIMILAR FACILITIES IF THEY ARE SET UP FOR AND SERVE EXCLUSIVELY THE PARTICULAR CONSTRUCTION OPERATION AND ARE REASONABLY NEAR THE CONSTRUCTION SITE. TRANSPORTATION OF MATERIALS, EQUIPMENT, OR PERSONNEL TO AND FROM THE CONSTRUCTION SITE BY EMPLOYEES OF CONSTRUCTION CONTRACTORS OR SUBCONTRACTORS IS COVERED BY THE REQUIREMENTS; HOWEVER, SUCH TRANSPORTATION BY COMMON CARRIERS, MATERIAL SUPPLIERS, OR MANUFACTURERS IS NOT SUBJECT TO THE REQUIREMENTS. THE AEC HAS ISSUED LABOR STANDARDS REGULATIONS IN IMPLEMENTATION THE FEDERAL PROCUREMENT REGULATIONS. SEE SUBPART 9-12.4, TITLE 41 OF THE CODE OF FEDERAL REGULATIONS. PERTINANT SECTIONS OF THESE REGULATIONS, CITED BY THE SOLICITOR OF LABOR IN SUPPORT OF HIS OPINION, ARE AS FOLLOWS: 9-12.401-50 DEPARTMENT OF LABOR APPROVAL.

THE DEPARTMENT OF LABOR HAS PREVIOUSLY REVIEWED AND APPROVED THE CRITERIA, STANDARDS, AND GUIDES SET FORTH IN SECS. 9-12.402, 9-12.450 AND SUBSECTION 9-12.404-2 AND THE CONTRACT CLAUSE IN SEC. 9-12.403-50. 12.402-52 ADMINISTRATIVE CONTROLS AND CRITERIA FOR APPLICATION OF

THE DAVIS-BACON ACT IN OPERATIONAL OR MAINTENANCE ACTIVITIES.

(A) PARTICULAR CONTRACTS OR WORK ITEMS FALLING WITHIN ONE OR MORE OF THE FOLLOWING CRITERIA WILL BE CLASSIFIED AS NON-COVERED. * * * * * **

(5) EXPERIMENTAL DEVELOPMENT OF EQUIPMENT, PROCESSES AND DEVICES, INCLUDING ASSEMBLY, FITTING, INSTALLATION, TESTING, REWORKING, AND DISASSEMBLY. THIS REFERS TO EQUIPMENT, PROCESSES AND DEVICES WHICH ARE ASSEMBLED FOR THE PURPOSE OF CONDUCTING A TEST OR EXPERIMENT. THE DESIGN MAY BE ONLY CONCEPTUAL IN CHARACTER, AND PROFESSIONAL PERSONNEL RESPONSIBLE FOR THE EXPERIMENT PARTICIPATE IN THE ASSEMBLY. SPECIFICALLY EXCLUDED FROM THE CATEGORY OF EXPERIMENTAL DEVELOPMENT ARE BUILDINGS, BUILDING UTILITY SERVICES, STRUCTURAL CHANGES, AND MODIFICATIONS TO BUILDING UTILITY SERVICES--- AS DISTINGUISHED FROM TEMPORARY CONNECTIONS THERETO. ALSO SPECIFICALLY EXCLUDED FROM THIS CATEGORY IS EQUIPMENT TO BE USED FOR CONTINUOUS TESTING, E.G., A MACHINE TO BE CONTINUOUSLY USED FOR TESTING THE TENSIL STRENGTH OF STRUCTURAL MEMBERS. * * *

(6) EXPERIMENTAL WORK IN CONNECTION WITH PEACEFUL USES OF NUCLEAR ENERGY. THIS REFERS TO EQUIPMENT, PROCESSES AND DEVICES WHICH ARE ASSEMBLED AND/OR SET IN PLACE AND INTERCONNECTED FOR THE PURPOSE OF CONDUCTING A TEST OR EXPERIMENT. THE NATURE OF THE TEST OR EXPERIMENT IS SUCH THAT PROFESSIONAL PERSONNEL RESPONSIBLE FOR THE TEST OR EXPERIMENT AND/OR THE DATA TO BE DERIVED THEREFROM NECESSARILY MUST PARTICIPATE IN THE ASSEMBLY AND INTERCONNECTIONS. SPECIFICALLY EXCLUDED FROM EXPERIMENTAL WORK ARE BUILDINGS, BUILDING UTILITY SERVICES, STRUCTURAL CHANGES, DRILLING, TUNNELING, EXCAVATION AND BACKFILLING WORK WHICH CAN BE PERFORMED ACCORDING TO CUSTOMARY DRAWINGS AND SPECIFICATIONS, AND UTILITY SERVICES OR MODIFICATION TO UTILITY SERVICES--- AS DISTINGUISHED FROM TEMPORARY CONNECTIONS THERETO. WORK IN THIS CATEGORY MAY BE PERFORMED IN MINES OR IN OTHER LOCATIONS SPECIFICALLY CONSTRUCTED FOR TESTS OR EXPERIMENTS * * *. 9 12.450-1 GENERAL.

SECTION 9-12.402-52 NECESSARILY USES GENERAL LANGUAGE, AND IN SOME CASES THE APPLICATION OF THE CRITERIA DISCUSSED THEREIN TO PARTICULAR SITUATIONS MAY NOT BE CLEAR. THEREFORE, THIS SUBSECTION COVERS MORE SPECIFICALLY SOME OF THE AREAS OF PARTICULAR CONCERN TO AEC AND IS PROMULGATED TO CLARIFY THE APPLICATION OF THE CRITERIA. 9-12.450-2 SPECIFIC EXAMPLES.

THE FOLLOWING ARE APPLICATIONS OF THE REGULATIONS TO PARTICULAR SITUATIONS. ADDITIONAL NARRATIVE STATEMENTS DESCRIBING ITEMS OF WORK AND APPLICABILITY OF THE DAVIS-BACON ACT WILL BE DEVELOPED FROM TIME TO TIME AND ADDED TO THIS SUBSECTION.

(H) EXPERIMENTAL INSTALLATIONS. WITHIN AEC PROGRAMS, A VARIETY OF EXPERIMENTS ARE CONDUCTED INVOLVING MATERIALS, FUELS, COOLANTS, PROCESSES, EQUIPMENT, ETC. CERTAIN TYPES OF SITUATIONS WHERE TESTS AND EXPERIMENTS HAVE SOMETIMES PRESENTED COVERAGE QUESTIONS ARE DESCRIBED BELOW:

(3) REACTOR COMPONENT EXPERIMENTS. OTHER EXPERIMENTS ARE CARRIED ON BY INSERTION OF EXPERIMENTAL COMPONENTS WITHIN REACTOR SYSTEMS WITHOUT THE USE OF A LOOP ASSEMBLY. ILLUSTRATIVE OF REACTOR FACILITIES ERECTED FOR SUCH EXPERIMENTAL PURPOSES ARE THE SPECIAL POWER EXCURSION TEST REACTORS (SPERT) AT THE NATIONAL REACTOR TEST SITE, WHICH ARE DESIGNED FOR STUDYING REACTOR BEHAVIOR AND PERFORMANCE CHARACTERISTICS OF CERTAIN REACTOR COMPONENTS. SUCH A FACILITY MAY CONSIST OF A REACTOR VESSEL, PRESSURIZING TANK, COOLANT LOOPS, PUMPS, HEAT EXCHANGERS, AND OTHER AUXILIARY EQUIPMENT AS NEEDED. THE FACILITY ALSO MAY INCLUDE SUFFICIENT SHIELDING TO PERMIT WORK ON THE REACTOR TO PROCEED FOLLOWING A SHORT PERIOD OF POWER OPERATION AND BUILDINGS AS NEEDED TO HOUSE THE REACTOR AND ITS AUXILIARY EQUIPMENT. THE ERECTION AND ON-SITE ASSEMBLY OF SUCH A REACTOR FACILITY IS COVERED WORK, BUT THE COMPONENTS WHOSE CHARACTERISTICS ARE UNDER STUDY ARE EXCLUDED FROM COVERAGE. TO ILLUSTRATE, ONE OF THE SPERTS PLANNED FOR STUDIES OF NUCLEAR REACTOR SAFETY IS DESIGNED TO ACCOMMODATE VARIOUS INTERNAL FUEL AND CONTROL ASSEMBLIES AS REQUIRED TO CONDUCT A PARTICULAR TEST. ACCORDINGLY, THE INTERNAL STRUCTURE OF THE PRESSURE VESSEL IS SO DESIGNED THAT CORES OF DIFFERENT SHAPES AND SIZES MAY BE PLACED IN THE VESSEL FOR INVESTIGATION, OR THE ENTIRE INTERNAL STRUCTURE MAY BE EASILY REMOVED AND REPLACED BY A STRUCTURE WHICH WILL ACCEPT A DIFFERENT CORE DESIGN. SIMILARLY, THE CONTROL ROD ASSEMBLY IS ARRANGED TO PROVIDE FOR FLEXIBILITY IN THE REMOVAL OF INSTRUMENT LEADS AND EXPERIMENTAL ASSEMBLIES FROM WITHIN THE CORE.

(I) CONSTRUCTION SITE CONTIGUOUS TO AN ESTABLISHED MANUFACTURING FACILITY. AS AEC-OWNED PROPERTY SOMETIMES EMBRACES SEVERAL THOUSANDS OF ACRES OF REAL ESTATE, A NUMBER OF SEPARATE FACILITIES MAY BE LOCATED IN AREAS CONTIGUOUS TO EACH OTHER ON THE SAME PROPERTY. THESE FACILITIES MAY BE BUILT OVER A PERIOD OF YEARS, AND ESTABLISHED MANUFACTURING ACTIVITIES MAY BE REGULARLY CARRIED ON AT ONE SITE ON THE PROPERTY AT THE SAME TIME THAT CONSTRUCTION OF ANOTHER FACILITY IS UNDERWAY AT ANOTHER SITE. OCCASION, THE REGULAR MANUFACTURING ACTIVITIES OF THE OPERATING CONTRACTOR AT THE FIRST SITE MAY INCLUDE THE MANUFACTURE, ASSEMBLY AND RECONDITIONING OF COMPONENTS AND EQUIPMENT WHICH IN OTHER INDUSTRIES WOULD NORMALLY BE DONE IN ESTABLISHED COMMERCIAL PLANTS. WHILE THE MANUFACTURE OF COMPONENTS AND EQUIPMENT IN THE MANUFACTURING PLANT IS NONCOVERED, THE INSTALLATION OF ANY SUCH MANUFACTURED ITEMS ON A CONSTRUCTION JOB IS COVERED.

PURSUANT TO THE REQUEST OF THE INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS AND THE BUILDING AND CONSTRUCTION TRADES DEPARTMENT OF THEAFL-CIO, THE SOLICITOR OF LABOR ON OCTOBER 14, 1966, ISSUED AN OPINION (DB-52) TO THE AEC DIRECTOR OF THE OFFICE OF INDUSTRIAL RELATIONS THAT THE ASSEMBLY WORK IN QUESTION WAS SUBJECT TO THE DAVIS BACON ACT. THE SOLICITOR REASONED THAT ,ON-SITE ASSEMBLY OF MANUFACTURED COMPONENTS" AND SUBSEQUENT INSTALLATION AS A PORTION OF A PUBLIC WORK HAS LONG BEEN CONSIDERED SUBJECT TO THE DAVIS-BACON ACT. "THUS, THE ERECTION OF A $3 MILLION CONCRETE BUILDING TOGETHER WITH THE ON-SITE ASSEMBLY AND PERMANENT INSTALLATION THEREIN OF A CONVENTIONAL- 40-TON NUCLEAR REACTOR ORDINARILY WOULD CONSTITUTE THE CONSTRUCTION OF A PUBLIC WORK OF THE UNITED STATES WITHIN THE MEANING OF THAT ACT.' THE MERE FACT THAT THE REACTOR IN THIS CASE IS A PART OF A MOBILE SYSTEM TO BE USED FOR EXPERIMENTAL PURPOSES DID NOT REMOVE, IN HIS JUDGMENT, ITS ASSEMBLY AND FABRICATION FROM THE AMBIT OF THE ACT.

THIS CONCLUSION, IN THE SOLICITOR'S OPINION, WAS SUPPORTED BY THE AEC REGULATIONS RELATING TO SPERT (SECTION 9-12.450-2 (H) (3) (, WHICH ADMITTEDLY WAS COVERED WORK. THE DESCRIPTION OF THE REACTOR IN QUESTION WHICH HE HAD BEEN FURNISHED, HE STATED, REVEALED NO SIGNIFICANT DIFFERENCES BETWEEN IT AND THE SPERT REACTOR. HE NOTED THAT BOTH REACTORS ARE ASSEMBLED FOR USE IN AN EXPERIMENT AND ARE DESIGNED TO ACCOMMODATE CONTROL ASSEMBLIES AND MEASURING INSTRUMENTS TO FACILITATE THEIR EMPLOYMENT IN VARIOUS TESTS. "WE ARE PERSUADED," HE STATED, "THAT THESE ACCOMMODATIONS IN DESIGN DO NOT RENDER THE SUBJECT REACTOR OF SUCH AN EXPERIMENTAL CHARACTER AS TO EXCLUDE COVERAGE OF ITS ASSEMBLY UNDER THE CONSIDERATIONS STATED IN AECPR 9 12.402-52 (A) (5) AND (6).' THE SOLICITOR CONCLUDED HIS OPINION AS FOLLOWS: FINALLY, THE FACT THAT THE ASSEMBLY OF THE REACTOR IS TO TAKE PLACE IN AN EXISTING AEC FACILITY (BUILDING 607) A LITTLE OVER A MILE FROM THE CONTAINMENT BUILDING IS NOT DECISIVE OF COVERAGE. THE REACTOR ITSELF IS A PUBLIC WORK OF THE UNITED STATES. NO ARGUMENT IS MADE TO THE CONTRARY. ITS MAJOR COMPONENTS WILL BE PROCURED FROM MANUFACTURING FIRMS THROUGHOUT THE COUNTRY AND WILL BE FABRICATED AND ASSEMBLED IN ARCO, WE ARE INFORMED, BY TWO LARGE INDEPENDENT CONTRACTORS UNDER EXISTING AEC CONTRACTS. THE PLACE OF ITS ASSEMBLY AND FABRICATION IN BUILDING 607 IS ITS OWN JOB SITE. THAT UNRELATED AEC WORK MAY BE PERFORMED THERE BY OTHERS CONTEMPORANEOUS WITH ITS ASSEMBLY IS, UNDER THESE CIRCUMSTANCES, IMMATERIAL. FOR THESE REASONS, WE HAVE CONCLUDED THAT THE ASSEMBLY OF THE SUBJECT REACT OR CONSTITUTES "CONSTRUCTION" WITHIN THE MEANING OF THE DAVIS-BACON ACT.

ON JANUARY 4, 1967, THE AEC AND IDAHO NUCLEAR CORPORATION JOINTLY PETITIONED THE WAGE APPEALS BOARD FOR A REVIEW OF THE SOLICITOR'S OPINION. THE COMMISSION AND IDAHO NUCLEAR ARGUED BEFORE THE BOARD, INTER ALIA, THAT: (1) THE WORK IN QUESTION IS "EXPERIMENTAL WORK" WITHIN THE MEANING OF AEC PROCUREMENT REGULATIONS 9-12 AND FEDERAL PROCUREMENT REGULATIONS 1-12.402-1 (A) (2) AND (3) AND THEREFORE BY REGULATION IS EXCLUDED FROM COVERAGE UNDER THE DAVIS-BACON ACT; (2) THE WORK IN QUESTION DOES NOT CONSTITUTE "CONSTRUCTION WORK" OR A "PUBLIC WORK" WITHIN THE MEANING OF THE DAVIS-BACON ACT; (3) THE WORK IN QUESTION IS A MANUFACTURING ACTIVITY EXCLUDED FROM THE COVERAGE OF THE DAVIS-BACON ACT; AND (4) THE WORK IN QUESTION IS SIGNIFICANTLY DIFFERENT FROM WORK PERFORMED AS COVERED WORK UNDER THE DAVIS-BACON ACT IN CONNECTION WITH SPERT AND THE ASSEMBLY OF THE REACTOR SYSTEM IN THIS CASE FOR THE LOFT IS NOT THE TYPE OF WORK WHICH HAS EVER BEEN PERFORMED UNDER A CONTRACT SUBJECT TO THE DAVIS-BACON ACT AT NRTS--- ON THE CONTRARY, WORK OF THIS TYPE HAS CONSISTENTLY BEEN PERFORMED UNDER CONTRACTS WHICH WERE NOT SUBJECT TO THE ACT AND DOES NOT REPRESENT A DEPARTURE FROM PAST AEC DAVIS- BACON DETERMINATIONS MADE IN CONNECTION WITH WORK OF A SIMILAR NATURE.

THE WAGE APPEALS BOARD RENDERED ITS OPINION (67-6) ON APRIL 8, 1967. UPHELD THE DETERMINATION BY THE SOLICITOR OF LABOR, STATING IN PERTINENT PART:

THE PETITIONERS STATE THAT THE ERECTION OF THE REACTOR SYSTEM INVOLVES A CONFIGURATION WHICH IS CONCEPTUAL IN NATURE; IT WILL INVOLVE SUPERVISION AND PARTICIPATION IN THE ERECTION BY PROFESSIONAL PERSONNEL. THE REACTOR IS THEN DESCRIBED AS "AN EXPERIMENT INVOLVING PEACEFUL USES OF NUCLEAR ENERGY; I.E., SAFETY OF PRIVATE AND PUBLIC REACTOR FACILITIES WHICH ARE OR WILL BE UTILIZED IN THE GENERATION OF ELECTRICAL POWER.'

HOWEVER, AS NOTED IN 41 CFR 9-12.5005-1 (NOW 9-12.450-1), THE QUOTED REGULATIONS NECESSARILY USE GENERAL LANGUAGE AND IN SOME CASES THE APPLICATION OF THE CRITERIA IS UNCLEAR, SUCH AS IN THIS CASE. THE SPECIFIC EXAMPLES OF HOW THE CRITERIA HAVE BEEN APPLIED, WHICH ARE CONTAINED IN 41 CFR 9-12.5005-2 (NOW 9-12.450-2), PROVIDE HELPFUL GUIDANCE. WE AGREE WITH THE SOLICITOR THAT, FOR PURPOSES OF THE DAVIS BACON ACT, THERE IS NO SIGNIFICANT DIFFERENCE BETWEEN THE LOFT REACTOR AND THE SPERT REACTORS DESCRIBED IN 41 CFR 9-12.505-2 (I) (3) (NOW 9 12.450-2 (H) (3) ). THE SPERT REACTORS ARE BEING USED TO CONDUCT EXPERIMENTS, ONE OF WHICH IS TO TEST VARIOUS CORES OF DIFFERENT SHAPES AND SIZES. THE LOFT REACTOR IS TO BE USED TO EXPERIMENT ALSO; I.E., TO DETERMINE WHAT WILL HAPPEN WHEN THE COOLANT IS WITHDRAWN. IN THE FORMER, THE AEC WANTS TO STUDY "REACTOR BEHAVIOR" AND WHAT HAPPENS WHEN DIFFERENT KINDS OF SHAPES OF CORES ARE INSERTED. IN THE LATTER, IT WANTS TO STUDY "REACTOR BEHAVIOR" AND SEE WHAT HAPPENS WHEN THE COOLANT IS REMOVED. BOTH LOFT AND SPERT HAVE MANY CHARACTERISTICS OF STANDARD REACTORS WHICH ARE BUILT AND SUBSEQUENTLY USED FOR EXPERIMENTAL PURPOSES. EXPERIMENTAL PROJECTS USUALLY DEAL WITH WORK, THE DEFINITION, DELINEATION, OR SCOPE OF WHICH INVOLVES SUCH DIFFICULTIES THAT FULL SPECIFICATION IS NOT POSSIBLE OR PRACTICAL. ACCORDING TO THE FACTS BEFORE US, THIS IS NOT THAT KIND OF SITUATION.

WE CONCLUDE THAT THE LOFT REACTOR IS TO BE TREATED THE SAME AS THE SPERT REACTORS FOR PURPOSES OF COVERAGE UNDER THE DAVIS-BACON ACT. THERE IS NO QUESTION AMONG THE PARTIES THAT THE SPERT REACTORS ARE COVERED "PUBLIC WORKS" UNDER THE ACT AND THAT THEIR ERECTION CONSTITUTES ,CONSTRUCTION.' THEREFORE, THERE IS NO NEED IN THIS DECISION FOR FURTHER EXPOSITION ON THE GENERIC AND SPECIFIC MEANINGS OF THESE TERMS IN THE ADMINISTRATION OF THE DAVIS-BACON ACT. * * *

APPARENTLY THERE IS NO DISAGREEMENT AMONG THE INTERESTED PARTIES HERE, INCLUDING THE SOLICITOR OF LABOR AND THE WAGE APPEALS BOARD, THAT THE CONTROLLING CRITERIA TO BE USED IN DETERMINING APPLICABILITY OF THE DAVIS- BACON ACT IN THIS CASE ARE THE AEC PROCUREMENT REGULATIONS. THESE REGULATIONS WERE PROPERLY PROMULGATED IN IMPLEMENTATION OF THE FEDERAL PROCUREMENT REGULATIONS AND THEY WERE REVIEWED AND APPROVED BY THE DEPARTMENT OF LABOR TO BE USED, OBVIOUSLY, FOR THE VERY PURPOSE TO WHICH THEY WERE APPLIED HERE, I.E., TO SERVE AS CRITERIA IN DETERMINING COVERAGE.

THE PROMULGATION AND ADOPTION OF THESE REGULATIONS BY THE AEC IS IN LINE WITH OUR OBSERVATION IN 44 COMP. GEN. 498, 502, THAT THE PRIMARY RESPONSIBILITY FOR DETERMINING WHETHER DAVIS-BACON ACT PROVISION SHOULD, OR SHOULD NOT, BE INCLUDED IN A PARTICULAR CONTRACT RESTS WITH THE CONTRACTING AGENCY WHICH MUST AWARD, ADMINISTER AND ENFORCE THE CONTRACT. WE ALSO NOTED IN THAT DECISION (WITH RESPECT TO THE SOLICITOR OF LABOR'S DISAGREEMENT WITH A DETERMINATION OF NONCOVERAGE BY A NASA CONTRACTING OFFICER), THAT NEITHER THE DEPARTMENT OF LABOR NOR OUR OFFICE SHOULD LIGHTLY DISTURB A CONTRACTING AGENCY'S DETERMINATION IN THAT REGARD. THE PROPRIETY AND SOUNDNESS OF THE LATTER OBSERVATION IS DEMONSTRATED BY THE FACTS IN THIS CASE. FOR THE REASONS STATED BELOW, WE BELIEVE THE INITIAL DETERMINATION BY THE AEC THAT THE DAVIS-BACON ACT DOES NOT APPLY TO THE ASSEMBLY OF LOFT IS LEGALLY CORRECT.

THE SOLICITOR OF LABOR'S OPINION IS PREMISED ON THE STATEMENT THAT THE ERECTION OF A $3 MILLION CONCRETE BUILDING TOGETHER WITH THE "ON SITE ASSEMBLY" AND "PERMANENT" INSTALLATION THEREIN OF A ,CONVENTIONAL" 40-TON NUCLEAR REACTOR ORDINARILY WOULD CONSTITUTE THE CONSTRUCTION OF A PUBLIC WORK OF THE UNITED STATES WITHIN THE MEANING OF THAT ACT. (SEE IN THIS CONNECTION SECTION 1-12.402-1 (A) (4) FPR SUPRA.) THE MERE FACT, HE STATES, THAT THE REACTOR IN THIS CASE IS A PART OF A MOBILE SYSTEM TO BE USED FOR EXPERIMENTAL PURPOSES DOES NOT REMOVE ITS ASSEMBLY AND FABRICATION FROM THE AMBIT OF THE ACT. WE NOTE THAT THE SOLICITOR GIVES NO REASONS WHY HE BELIEVES THAT THE FACT THE REACTOR IS A PART OF A MOBILE SYSTEM TO BE USED FOR EXPERIMENTAL PURPOSES DOES NOT REMOVE ITS ASSEMBLY AND FABRICATION FROM THE AMBIT OF THE ACT. THE ESSENTIAL FACTS, WHICH ARE NOT IN DISPUTE, ESTABLISH THAT LOFT: (1) WILL NOT BE ASSEMBLED ON THE SITE OF THE $3 MILLION CONCRETE BUILDING; (2) WILL NOT BE "PERMANENTLY INSTALLED" THEREIN; AND (3) IS NOT A "CONVENTIONAL" 40-TON NUCLEAR REACTOR.

LOFT WILL BE ASSEMBLED IN THE 607 BUILDING. THE BRIEF ACCOMPANYING YOUR PETITION FOR REVIEW BEFORE THE WAGE APPEALS BOARD NOTES THAT BUILDING 607 WAS CONSTRUCTED 13 YEARS AGO FOR WORK IN CONNECTION WITH THE AEC AIRCRAFT NUCLEAR PROPULSION PROGRAM, AND HAS BEEN USED AS A MANUFACTURING AND MAINTENANCE FACILITY FOR SUPPORT OF OPERATIONAL WORK AT NRTS SINCE THAT TIME. IT IS NOTED THAT THE AEC PROCUREMENT REGULATIONS (9-12.450-2 (I) ( GIVE APPROVED RECOGNITION TO THE PARTICULAR CIRCUMSTANCES WHICH INVOLVE AEC MANUFACTURING FACILITIES ON AEC PROPERTY UPON WHICH CONSTRUCTION ACTIVITIES ALSO TAKE PLACE. THE SITE OF THE WORK (I.E., THE ASSEMBLY OF LOFT) IS NOT THE $3.1 MILLION CONTAINMENT AND CONTROL FACILITY WHICH WILL BE CONSTRUCTED BY N.W. KELLOG COMPANY AND WHICH IS ADMITTEDLY COVERED BY THE DAVIS-BACON ACT. NOR DO WE THINK IT IS AN ANSWER TO SAY THAT ,THE PLACE OF ITS ASSEMBLY AND FABRICATION IN BUILDING 607 IS ITS OWN JOB SITE.' THIS CONTENTION IS ADEQUATELY CONTROVERTED BY THE FOLLOWING OBSERVATIONS, WITH WHICH WE AGREE, SET FORTH IN THE BRIEF ACCOMPANYING YOUR PETITION FOR REVIEW: IN THE NEXT TO LAST PARAGRAPH OF DB-52 IT IS INDICATED THAT NO ARGUMENT WAS MADE THAT THE REACTOR WAS NOT A PUBLIC WORK OF THE UNITED STATES AND CONTINUES BY STATING THAT "THE PLACE OF ITS ASSEMBLY AND FABRICATION IN BUILDING 607 IS ITS OWN JOB SITE.' THE REACTOR SYSTEM IS A MANUFACTURED ITEM OF MACHINERY OR EQUIPMENT IN THE SAME SENSE THAT A LATHE, A DIESEL GENERATOR, A TRANSFORMER, A TRUCK, AN ARMORED TANK, AN AIRCRAFT, A SPACE CAPSULE, A ROCKET ARE ITEMS OF MANUFACTURED EQUIPMENT. WHEN THE GOVERNMENT PURCHASES OR CAUSES TO BE MANUFACTURED A DIESEL GENERATOR, A TRUCK OR A ROCKET AND PAYS FOR IT WITH APPROPRIATED FUNDS, IT OF COURSE IS ACQUIRING SAME FOR THE BENEFIT OF THE PUBLIC AND THE MANUFACTURE OF SUCH EQUIPMENT INVOLVES WORK WHICH IN A GENERIC SENSE IS A "PUBLIC WORK.' HOWEVER, TO SUGGEST THAT THE MANUFACTURE OF A TRANSFORMER IS A PUBLIC WORK WITHIN THE MEANING OF THE DAVIS-BACON ACT AND CARRIES WITH IT ITS OWN JOB SITE WOULD BE TANTAMOUNT, IN ITS POTENTIAL APPLICATION, TO SAYING THAT WHEN A PARTICULAR TRANSFORMER IS BEING MANUFACTURED BY THE X COMPANY FOR THE SPECIFIC PURPOSE OF BEING UTILIZED AT A GOVERNMENT INSTALLATION THEN UNDER CONSTRUCTION, AND SUBJECT TO THE ACT, THERE IS A "FLOW BACK" OF THE DAVIS-BACON COVERAGE TO THE WORK INVOLVED IN THE MANUFACTURE OF THE TRANSFORMER BY THE X COMPANY IN ITS OWN MANUFACTURING FACILITY. WE ARE NOT AWARE OF ANY PRIOR DECISION, INTERPRETATION OR OPINION THAT WOULD SUPPORT THIS PROPOSITION. TO OUR KNOWLEDGE THE CONCEPT OF MANUFACTURING AS A PUBLIC WORK UNDER THE DAVIS- BACON ACT HAS NEVER GONE BEYOND AN APPLICATION TO MANUFACTURING OR FABRICATION OF CONSTRUCTION MATERIALS AND COMPONENTS ON THE CONSTRUCTION SITE UNDER A CONTRACT OTHERWISE SUBJECT TO THE ACT.

FROM THE AEC EXPLANATION OF THE LOFT PROJECT, WHICH IS THE SOLE AND UNDISPUTED FACTUAL STATEMENT OF THE CASE, WE FIND NO RATIONAL BASIS FOR THE CONCLUSION THAT THE LOFT WILL UNDERGO ,PERMANENT INSTALLATION" WITHIN THE CONTAINMENT BUILDING. AS THE SOLICITOR'S OPINION RECOGNIZES, LOFT WILL BE A MOBILE SYSTEM. AFTER ITS ASSEMBLY IN BUILDING 607 IT WILL BE MOVED ON A RAILROAD DOLLY ONE-AND-A-QUARTER MILES INTO THE CONTAINMENT BUILDING WHERE IT WILL BE "PLUGGED INTO" UTILITIES AND INSTRUMENTATION CONTAINED IN THE REMOTE CONTROL BUILDING. LOFT WILL THEN UNDERGO A NUCLEAR TEST OF APPROXIMATELY 5 DAYS DURATION AFTER WHICH IT WILL BE PARTIALLY DECONTAMINATED, UNPLUGGED, AND MOVED BACK TO THE HOT SHOP IN THE 607 BUILDING, WHERE THE REACTOR WILL BE DISASSEMBLED AND THE EFFECTS OF THE TESTS STUDIED. THE "PLUGGING IN" OF THE REACTOR SYSTEM TO THE UTILITIES OF THE CONTAINMENT FACILITIES UNDER THESE CIRCUMSTANCES CAN HARDLY BE REGARDED AS A ,PERMANENT INSTALLATION; " RATHER, IT WOULD MORE APTLY BE DESCRIBED AS A "TEMPORARY CONNECTION.' IN EITHER CASE, THE "INSTALLATION" OR "CONNECTION" IS NOT FOR UTILIZATION FOR THE NORMAL FUNCTIONS OF A REACTOR, BUT SOLELY FOR THE CONDUCT OF DESTRUCTIVE TESTING AND EXPERIMENTATION.

AS TO THE THIRD DISTINCTION ABOVE NOTED, LOFT, WE ARE INFORMED, IS NOT A "CONVENTIONAL" REACTOR IN THE SENSE USED BY THE SOLICITOR IN HIS OPINION. WHILE IT IS TRUE THAT MANY OF THE REACTOR'S COMPONENT PARTS ARE "STANDARD" (IN THE SENSE OF NUCLEAR REACTOR STANDARDS) THE REACTOR SYSTEM ITSELF IS NOT STANDARD. IN THE MEMORANDUM, ABOVE MENTIONED, WHICH WAS SUBMITTED BY THE AEC TO THE SOLICITOR BY LETTER OF SEPTEMBER 27, 1966, IT IS STATED: * * * IF WE WERE CONSIDERING A STANDARD REACTOR SYSTEM, IT COULD BE PURCHASED AS A COMPLETED PIECE OF EQUIPMENT FROM A REACTOR MANUFACTURER. THE REAL CRUX OF THE MATTER HERE LIES IN THE METHOD OF ASSEMBLY, THE "ART" OF DESIGNING THE CONFIGURATION, THE INSTRUMENTATION, THE NECESSITY FOR IMPROVISING, AND THE REQUIREMENTS FOR DEVELOPING MACHINE METHODS AND TOOLS, ALL TO ACHIEVE A NUCLEAR REACTOR SYSTEM CAPABLE OF PRODUCING BY ITS DESTRUCTION THE DESIRED SCIENTIFIC DATA. THE WORK * * * INVOLVES A DETAILED STEP-BY-STEP PROCEDURE OF ASSEMBLY, FITTING, TESTING, DISASSEMBLY, REWORKING AND REASSEMBLY. THE REACTOR SYSTEM ONCE FINALLY ASSEMBLED WILL BE AN EXPERIMENTAL DEVICE JUST AS IS A MODEL OF AN AIRCRAFT THAT IS PUT INTO A WIND TUNNEL AND SUBJECTED TO ATMOSPHERIC FORCES TO DETERMINE AT WHAT VELOCITY THE AIRCRAFT'S WINGS WILL BE TORN FROM THE FUSELAGE OR AT WHAT POINT METAL FATIGUE WILL CAUSE A RUPTURE OF THE AIRCRAFT'S STRUCTURE. IT IS ESSENTIAL THAT SCIENTIFIC PERSONNEL, WHICH WILL BE CALLED UPON TO EVALUATE THE TEST AND WHICH ORIGINALLY DICTATED THE NEEDS AND SCOPE OF THE TEST, PARTICIPATE IN THE ARRANGEMENT (CONFIGURATION) OF THE COMPONENT'S PARTS AND THEIR ASSEMBLY, IN THE TECHNICAL METHODS OF ASSEMBLY, SUCH AS TYPES, PLACES, AND KINDS OF WELDS, AND PARTICULARLY IN TYPE, KIND, AND LOCATION OF INSTRUMENTATION. (FOOTNOTE OMITTED.)

WE TURN NOW TO A CONSIDERATION OF THE AEC PROCUREMENT REGULATIONS WHICH, THE SOLICITOR ASSERTED, SUPPORTED HIS OPINION AND WHICH FORMED THE BASIS FOR AFFIRMANCE OF HIS OPINION BY THE WAGE APPEALS BOARD. THE SOLICITOR REASONED THAT SINCE THE ASSEMBLY OF THE SPERT REACTOR WAS ADMITTEDLY COVERED WORK (AECPR 9-12.450-2 (H) (3) ( AND THE DESCRIPTION FURNISHED HIM ABOUT LOFT REVEALED NO SIGNIFICANT DIFFERENCES, ASSEMBLY OF LOFT WAS THEREFORE ALSO COVERED. BOTH REACTORS, HE STATED, ARE ASSEMBLED FOR USE IN AN EXPERIMENT AND, ACCORDINGLY, ARE DESIGNED TO ACCOMMODATE CONTROL ASSEMBLIES AND MEASURING INSTRUMENTS TO FACILITATE THEIR EMPLOYMENT IN VARIOUS TESTS. HE WAS PERSUADED, HE STATED, THAT THESE ACCOMMODATIONS IN DESIGN DID NOT RENDER LOFT OF SUCH AN EXPERIMENTAL CHARACTER AS TO EXCLUDE COVERAGE OF ITS ASSEMBLY UNDER THE CONSIDERATIONS STATED IN AECPR 9-12.402 -52 (A) (5) AND (6).

ON THE OTHER HAND, THE AEC TAKES THE FIRM POSITION THAT THE LOFT REACTOR SYSTEM IS SIGNIFICANTLY DIFFERENT THAN THE SPERT FACILITIES DESCRIBED IN AECPR 9-12.450-2 (H) (3). THE AEC RELIES ON THAT PART OF 9-12.450-2 (H) (3) WHICH STATES THAT "THE COMPONENTS WHOSE CHARACTERISTICS ARE UNDER STUDY ARE EXCLUDED FROM COVERAGE.' THE PORTION OF 9-12.450-2 (H) (3) WHICH FOLLOWS THE QUOTED STATEMENT CONCERNING COMPONENTS WAS OMITTED FROM THE SOLICITOR'S OPINION AND WAS APPARENTLY GIVEN NO EFFECT. THE AEC ARGUES THAT THIS OMITTED PORTION OF THE REGULATION IS THE CRUX OF THE MATTER AND THAT LOFT CAN MORE LOGICALLY BY COMPARED TO THE SPERT COMPONENTS WHOSE CHARACTERISTICS ARE UNDER STUDY, AND WHICH HAVE NEVER BEEN PRODUCED UNDER DAVIS-BACON COVERAGE, THAN TO THE SPERT FACILITIES WHICH WERE COVERED AND WHICH WERE ONLY THE PERMANENT PART OF THE REACTOR.

IN THAT CONNECTION, THE AEC STATES THAT THE LOFT REACTOR SYSTEM IS, IN AND OF ITSELF, AN EXPERIMENTAL DEVICE (THE SUBJECT OF RESEARCH). IT HAS NO UTILITARIAN PURPOSE IN THE ORDINARY SENSE OF THE WORD (E.G., IT IS NOT TREATED FOR BUDGETARY PURPOSES AS CAPITAL EQUIPMENT, BUT TO THE CONTRARY IT IS TREATED AS AN EXPENDIBLE). IT IS ASSEMBLED IN ORDER THAT IT MAY BE DESTROYED AND THEREAFTER IT IS EXAMINED TO DETERMINE WHAT HAPPENS TO SUCH A DEVICE. THE AEC NOTES THAT LOFT IS EXPERIMENTAL IN NATURE, AND WHILE PERHAPS NOT AS EXOTIC AS ROCKETS, SPACE CAPSULES AND MACH 3 AIRCRAFT, IT IS BASICALLY THE SAME TYPE OF PERSONALTY. MOREOVER, THE AEC NOTES THAT LIKE THE ROCKET OR AN AIRPLANE LOFT IS NOT ATTACHED TO REALTY, IT IS NOT A FIXTURE OF A BUILDING, IT IS NOT AN INTEGRAL PART OF A BUILDING AND IT IS NOT EQUIPMENT OR MACHINERY INTEGRAL TO CONSTRUCTION OR CONSTRUCTION PROCESSES.

ON THE OTHER HAND, THE AEC POINTS OUT THAT THE SPERT FACILITIES ARE PERMANENT FACILITIES AND INVOLVE REACTOR DYNAMIC STUDIES. THE SPERT TESTS UTILIZE EXPERIMENTS WITHIN THE REACTOR CORE. IN OTHER WORDS, ACCORDING TO THE AEC, THE REACTOR FACILITIES OF SPERT ARE PERMANENT FACILITIES COMPARABLE TO THE CONTAINMENT AND CONTROL FACILITY OF LOFT. THE COMPONENTS TESTED IN SPERT, SAYS THE AEC, CONSIST OF THE REACTOR CORES WHICH ARE PLACED IN THE REACTOR FOR EXPOSURE TO EXPERIMENTAL CONDITIONS OF TEMPERATURE AND PRESSURE. CONSEQUENTLY, THE CORE ITSELF IS THE COMPONENT WHOSE CHARACTERISTICS ARE UNDER STUDY WHEREAS IN LOFT THE REACTOR SYSTEM IS THE COMPONENT UNDER STUDY.

PURSUANT TO OUR REQUEST THE AEC, ON AUGUST 4, 1967, FURNISHED OUR OFFICE A SET OF PICTURES DEPICTING LOFT, SPERT, SPERT II, SPERT III, SPERT IV AND OTHER REACTOR SYSTEMS TOGETHER WITH DESCRIPTIONS THEREOF. IN ADDITION, A MORE DETAILED COMPARATIVE DESCRIPTION OF LOFT AND SPERT WAS FURNISHED WHICH WE NEED NOT GO INTO EXCEPT TO SAY THAT THIS COMPARATIVE ANALYSIS, ALONG WITH THE PICTURES, CONVINCES US THAT THE AEC ASSERTIONS ABOVE OUTLINED WITH RESPECT TO LOFT FALLING WITHIN THE "COMPONENT LANGUAGE" OF AECPR 9-12.450-2 (H) (3) ARE CLEARLY CORRECT.

WE ARE ALSO CONVINCED THAT THE AEC POSITION ON LOFT IS ENTIRELY CONSISTENT WITH PAST DETERMINATIONS BY THE AEC WHICH HAVE EXCLUDED OTHER REACTOR TEST ASSEMBLIES SIMILAR TO LOFT FROM DAVIS-BACON ACT COVERAGE. PARTICULARLY SIGNIFICANT IN THIS RESPECT ARE THE TWO EXPERIMENTAL HIGH TEMPERATURE REACTOR EXPERIMENTS (HTRE) AND THE SNAPTRAN EXPERIMENTS.

THE HTRE SYSTEMS WERE DOLLY MOUNTED NUCLEAR POWER PLANTS USED IN THE ANP PROGRAM WHICH WAS UNDERTAKEN TO DEVELOP AN AIRPLANE POWERED BY NUCLEAR REACTORS. THESE REACTORS WERE MOVED ON THEIR DOLLIES INTO TEST FACILITIES THE SAME AS LOFT. THE DOLLY MOUNTED EXPERIMENTAL EQUIPMENT WAS ASSEMBLED BY OPERATING PERSONNEL AS NONCOVERED WORK IN BUILDING 607 AND THEN MOVED TO THE IET BUILDING FOR TESTING. PHOTOGRAPHS OF THE TWO HTRE SYSTEMS REVEAL CONFIGURATIONS WHICH ARE STRIKINGLY SIMILAR TO LOFT.

THE OBJECTIVE OF THE SNAPTRAN PROGRAMS, WE ARE INFORMED, WAS TO ASSESS THE ABILITY OF THE SNAP REACTORS TO WITHSTAND SEVERE REACTIVITY ADDITIONS WHICH MIGHT OCCUR DURING LAUNCH OF THE SYSTEM INTO SPACE. THE TESTS CONSISTED OF A SERIES OF INCREASING REACTIVITY ADDITIONS TO THE SNAP REACTOR UNTIL GROSS DESTRUCTION OCCURRED. IN THE TESTS THE REACTOR EQUIPMENT, WHICH WAS THE EQUIPMENT UNDER TEST, WAS MOUNTED ON RAILROAD DOLLIES AND TRANSPORTED TO A PERMANENT TEST FACILITY (IET) WHERE THE EXPERIMENTS WERE CONDUCTED. THE ASSEMBLY OF THE REACTOR SYSTEMS ON DOLLIES WAS ACCOMPLISHED IN THE 607 BUILDING UNDER CONTRACTS WHICH DID NOT CONTAIN DAVIS-BACON ACT PROVISIONS.

IN THE INSTANT CASE, THE MANAGER, IDAHO OPERATIONS OFFICE, DETERMINED THAT ASSEMBLY OF LOFT WAS WORK NOT SUBJECT TO THE DAVIS BACON ACT. THIS DETERMINATION WAS MADE ONLY AFTER CAREFUL STUDY OF THE QUESTION BY THE IDAHO DAVIS-BACON COMMITTEE. THEREAFTER AEC HEADQUARTERS REVIEWED THE WORK IN QUESTION AND THE BASIS FOR THE DETERMINATION AND CONCURRED IN THAT DETERMINATION. IT WOULD APPEAR THAT THE MANAGER'S DETERMINATION WAS MADE NOT ONLY IN GOOD FAITH BUT ON A BASIS WHICH WAS CONSISTENT WITH APPLICABLE PROCUREMENT REGULATIONS (FPR 1-12.402-1 (A) (3) AND AECPR 9-12.402-52 (A) (5) AND (6) AND WITH PAST DETERMINATIONS BY THE AEC EXCLUDING OTHER REACTOR TEST ASSEMBLIES SIMILAR TO LOFT FROM COVERAGE OF THE ACT. COMPARE 44 COMP. GEN. 489, 503. IN THE LIGHT OF THE WEIGHT CUSTOMARILY GIVEN TO SETTLE ADMINISTRATIVE INTERPRETATION, AND THE PRINCIPLE THAT THE INTERPRETATION OF A REGULATION BY THE AGENCY WHICH PROMULGATED IT IS MORE AUTHORITATIVE THAN THAT OF SOME OTHER AGENCY, AND HAVING REGARD ALSO TO THE TERMS OF THE DAVIS-BACON ACT ITSELF, WE SEE NO VALID REASONS TO DISTRUB THAT DETERMINATION.

ACCORDINGLY, YOU ARE ADVISED IT IS THE VIEW OF THIS OFFICE THAT ANY CONTRACT, OR CONTRACTS, FOR THE PERFORMANCE OF REACTOR SYSTEM ASSEMBLY FOR THE LOSS OF FLUID TEST EXPERIMENT SHOULD NOT CONTAIN THE MINIMUM WAGE STIPULATIONS REQUIRED BY THE DAVIS-BACON ACT, AND WE WOULD BE CONSTRAINED TO APPLY THIS VIEW IN THE AUDIT OF EXPENDITURES OF APPROPRIATED FUNDS UNDER SUCH CONTRACT OR CONTRACTS.

A COPY OF THIS DECISION IS BEING FURNISH ..END :