B-163457, MAR. 29, 1968

B-163457: Mar 29, 1968

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TO COMPONENT PARTS CORPORATION: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF FEBRUARY 1. YOU CONTEND THAT YOU WERE ENTITLED TO AWARD AS THE LOWEST. THE INVITATION WAS ISSUED ON NOVEMBER 27. BIDS WERE OPENED ON DECEMBER 21. FORTY-NINE INVITATIONS WERE ISSUED AND 24 BIDS WERE RECEIVED. THE THREE LOWEST BIDS WERE AS FOLLOWS: NAME UNIT PRICE AMOUNT DISCOUNT COMPONENT PARTS CORP. $23.28 $48. YOUR BID PRICE WAS DETERMINED TO BE THE LOWEST BID SUBMITTED AT $23.1636 EACH. BIDDERS WERE REQUIRED TO INDICATE ON THEIR BIDS THAT THEY WERE EITHER A MANUFACTURER OF. YOU REPRESENTED ON YOUR BID THAT COMPONENT PARTS IS A MANUFACTURER OF THE ITEM BID UPON. NEW YORK 11710" A PREAWARD SURVEY WAS CONDUCTED TO DETERMINE WHETHER YOUR COMPANY QUALIFIED AS A MANUFACTURER OR A REGULAR DEALER WITHIN THE MEANING OF THE WALSH-HEALEY PUBLIC CONTRACTS ACT AND ARMED SERVICES PROCUREMENT REGULATION (ASPR) 12-603.1 AND 12 603.2.

B-163457, MAR. 29, 1968

TO COMPONENT PARTS CORPORATION:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF FEBRUARY 1, 1968, PROTESTING AN AWARD TO ANY OTHER COMPANY UNDER INVITATION FOR BIDS NO. N00383-68-B-0498, ISSUED BY THE AVIATION SUPPLY OFFICE, DEPARTMENT OF THE NAVY, PHILADELPHIA, PENNSYLVANIA. YOU CONTEND THAT YOU WERE ENTITLED TO AWARD AS THE LOWEST, RESPONSIVE RESPONSIBLE BIDDER.

THE INVITATION WAS ISSUED ON NOVEMBER 27, 1967, FOR 2,086 MODIFICATION KITS FOR THE 12B/C BOMB SKID TO BE IN ACCORDANCE WITH THE BUREAU OF NAVAL WEAPONS DRAWINGS LISTED ON PAGE 7 OF THE INVITATION. BIDS WERE OPENED ON DECEMBER 21, 1967. FORTY-NINE INVITATIONS WERE ISSUED AND 24 BIDS WERE RECEIVED. THE THREE LOWEST BIDS WERE AS FOLLOWS:

NAME UNIT PRICE AMOUNT DISCOUNT COMPONENT PARTS CORP. $23.28 $48,562.08 1/2 PERCENT - 30 DAYS ADVANCE MACHINE CORP.23.18 48,353.48 NET PALMER, INC. 24.85 51,837.10 1/2 PERCENT - 30 DAYS ON THE BASIS OF THE DISCOUNT OFFERED, YOUR BID PRICE WAS DETERMINED TO BE THE LOWEST BID SUBMITTED AT $23.1636 EACH, OR A TOTAL OF $48,319.27.

PURSUANT TO THE WALSH-HEALEY ACT, 41 U.S.C. 35-45, BIDDERS WERE REQUIRED TO INDICATE ON THEIR BIDS THAT THEY WERE EITHER A MANUFACTURER OF, OR REGULAR DEALER IN, THE ITEMS BID UPON. YOU REPRESENTED ON YOUR BID THAT COMPONENT PARTS IS A MANUFACTURER OF THE ITEM BID UPON. IN PARAGRAPH 512 OF YOUR BID RELATING TO THE NAME OF PRINCIPAL MANUFACTURER (NOT THE DEALER) OF THE PROPERTIES; PLACE OF MANUFACTURE OF PROPERTIES OR PERFORMANCE OF SERVICES; AND LOCATION OF ARTICLES TO BE INSPECTED, YOUR BID CONTAINED THE FOLLOWING INFORMATION:

"TECHNI-DYNE INC.

2375 MERRICK ROAD

BELLMORE, NEW YORK 11710" A PREAWARD SURVEY WAS CONDUCTED TO DETERMINE WHETHER YOUR COMPANY QUALIFIED AS A MANUFACTURER OR A REGULAR DEALER WITHIN THE MEANING OF THE WALSH-HEALEY PUBLIC CONTRACTS ACT AND ARMED SERVICES PROCUREMENT REGULATION (ASPR) 12-603.1 AND 12 603.2. BASED ON THE INFORMATION MADE AVAILABLE TO THE CONTRACTING OFFICER, HE DETERMINED THAT COMPONENT PARTS CORPORATION WAS NOT A MANUFACTURER OF BOMB SKIDS AS THAT TERM IS DEFINED IN ASPR 12-603.1 FOR THE FOLLOWING REASONS:

"A. THE FINANCIAL REPORT OF COMPONENT PARTS DOES NOT INDICATE ANY FACTORY LABOR, NOR ANY FACTORY OVERHEAD.

B. COMPONENT PARTS EMPLOYS NO PERSONNEL CAPABLE OF PERFORMING MANUFACTURING DUTIES.

C. COMPONENT PARTS EMPLOYS ONLY ADMINISTRATIVE PERSONNEL.

D. COMPONENT PARTS IS NOT LISTED AS A MANUFACTURER IN DUN AND BRADSTREET REFERENCE BOOK.

E. THE DUN AND BRADSTREET REPORT INDICATES THAT COMPONENT PARTS RENTS ONLY OFFICE SPACE.

F. ALL AVAILABLE INFORMATION INDICATES THAT COMPONENT PARTS HAS NEVER PERFORMED ANY MANUFACTURING OPERATIONS AND AT LEAST AS TO THIS PROCUREMENT, HAS MADE NO ARRANGEMENT TO BEGIN ANY SUCH MANUFACTURING OPERATIONS.' ON JANUARY 30, 1968, AWARD WAS MADE TO ADVANCE MACHINE CORPORATION. WE FIND NO LEGAL BASIS TO QUESTION THAT AWARD.

UNDER 41 U.S.C. 38, THE SECRETARY OF LABOR IS AUTHORIZED AND DIRECTED TO ADMINISTER THE PROVISIONS OF THE WALSH-HEALEY ACT, AND TO MAKE SUCH RULES AND REGULATIONS AS MAY BE NECESSARY TO THAT END. PURSUANT TO THIS STATUTORY AUTHORITY, THE SECRETARY OF LABOR HAS ISSUED REGULATIONS WHICH ARE PROMULGATED IN TITLE 41, CHAPTER 50, OF THE CODE OF FEDERAL REGULATIONS. SECTION 201.101 OF THOSE REGULATIONS PROVIDES IN PERTINENT PART AS FOLLOWS:

"A BIDDER OR CONTRACTOR SHALL BE DEEMED TO BE A -MANUFACTURER- OR REGULAR DEALER- WITHIN THE MEANING OF THE STIPULATION REQUIRED BY SECTION 1 (A) OF THE ACT IF HE FALLS WITHIN ONE OF THE FOLLOWING CATEGORIES:

"/A) A MANUFACTURER IS A PERSON WHO OWNS, OPERATES, OR MAINTAINS A FACTORY OR ESTABLISHMENT THAT PRODUCES ON THE PREMISES THE MATERIALS, SUPPLIES, ARTICLES, OR EQUIPMENT REQUIRED UNDER THE CONTRACT AND OF THE GENERAL CHARACTER DESCRIBED BY THE SPECIFICATIONS.

"/B) A REGULAR DEALER IS A PERSON WHO OWNS, OPERATES, OR MAINTAINS A STORE, WAREHOUSE, OR OTHER ESTABLISHMENT IN WHICH THE MATERIALS, SUPPLIES, ARTICLES, OR EQUIPMENT OF THE GENERAL CHARACTER DESCRIBED BY THE SPECIFICATIONS AND REQUIRED UNDER THE CONTRACT ARE BOUGHT, KEPT IN STOCK, AND SOLD TO THE PUBLIC IN THE USUAL COURSE OF BUSINESS.

"/C) (1) EXCEPT AS HEREINAFTER PROVIDED, EVERY BID RECEIVED FROM ANY BIDDER WHO DOES NOT FALL WITHIN ONE OF THE FOREGOING CATEGORIES SHALL BE REJECTED BY THE CONTRACTING OFFICER.'

IN THE WALSH-HEALEY PUBLIC CONTRACTS ACT "RULINGS AND INTERPRETATIONS" NO. 3, PUBLISHED BY THE DEPARTMENT OF LABOR, SECTION 29 STATES AS FOLLOWS:

"/A) THE RESPONSIBILITY OF DETERMINING WHETHER OR NOT A BIDDER IS QUALIFIED AS A MANUFACTURER OR AS A REGULAR DEALER UNDER THE PUBLIC CONTRACTS ACT RESTS IN THE FIRST INSTANCE WITH THE CONTRACTING AGENCY. HOWEVER, ANY DECISION WHICH THE CONTRACTING OFFICER MIGHT MAKE IS SUBJECT TO REVIEW BY THE DEPARTMENT OF LABOR WHICH IS CHARGED WITH THE ADMINISTRATION OF THE ACT. THE DEPARTMENT OF LABOR MAY DETERMINE THE QUALIFICATIONS OF A BIDDER IN THE FIRST INSTANCE IN THE ABSENCE OF ANY DECISION BY THE CONTRACTING OFFICER.'

IT IS THUS CLEAR THAT UNDER THE ACT CITED, AND THE REGULATIONS OF THE SECRETARY OF LABOR AUTHORIZED BY THE ACT, THE CONTRACTING OFFICER WAS ACTING PROPERLY AND WITHIN THE SCOPE OF HIS AUTHORITY IN DETERMINING YOUR LACK OF QUALIFICATIONS AS A "MANUFACTURER" OR "REGULAR DEALER.' THE POWER TO REVIEW THAT DETERMINATION RESTS IN THE DEPARTMENT OF LABOR, RATHER THAN IN OUR OFFICE. IN THE EVENT YOU STILL DESIRE A REVIEW OF THE CONTRACTING OFFICER'S DETERMINATION, IT WOULD APPEAR THAT YOU SHOULD ADDRESS A REQUEST FOR SUCH REVIEW TO THE DEPARTMENT OF LABOR.

IN VIEW OF THE FOREGOING, WE MUST CONCLUDE THAT THE AWARD MADE UNDER THE INSTANT INVITATION IS NOT SUBJECT TO LEGAL OBJECTION BY OUR OFFICE.