B-167396, AUG. 28, 1969

B-167396, AUG. 28, 1969

CONTRACTS - BIDDER RESPONSIBILITY DECISION TO IMC MAGNETICS CORPORATION CONCERNING REQUEST FOR REVIEW OF NEGOTIATED AWARD TO CONSOLIDATED TRANSFORMERS, UNLIMITED, BY ARMY ON BASIS THAT SUCCESSFUL CONTRACTOR DID NOT QUALIFY AS MANUFACTURER. CONTRACTING OFFICER'S DETERMINATION THAT SUCCESSFUL BIDDER WAS MANUFACTURER WHICH DETERMINATION WAS SUSTAINED WHEN SUBSEQUENTLY PRESENTED TO DEPARTMENT OF LABOR IS NOT MATTER FOR REVIEW BY GAO.

TO IMC MAGNETICS CORPORATION:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JUNE 30, 1969, REQUESTING US TO REVIEW AN AWARD MADE TO CONSOLIDATED TRANSFORMERS, UNLIMITED, LOS ANGELES, CALIFORNIA, BY THE UNITED STATES ARMY MISSILE COMMAND, REDSTONE ARSENAL, ALABAMA, PURSUANT TO REQUEST FOR PROPOSALS NO. DAAH01-69-R-0521, PARTICULARLY IN VIEW OF THE FACT THAT YOUR INVESTIGATION HAS INDICATED A POSSIBILITY THAT THE SUCCESSFUL OFFEROR, OR CONTRACTOR, DID NOT QUALIFY AS A MANUFACTURER OF THE EQUIPMENT DESCRIBED IN THE PROPOSAL REQUEST.

COPIES OF THE CORRESPONDENCE AND DOCUMENTS COMPRISING THE CONTRACT FILE IN THIS CASE HAVE BEEN FURNISHED BY THE DEPARTMENT OF THE ARMY AND IT APPEARS THAT THE CONTRACT AWARD WAS MADE IN ACCORDANCE WITH THE GENERAL PROVISIONS OF THE ARMED SERVICES PROCUREMENT REGULATION CONCERNING THE NEGOTIATION OF CONTRACTS BY THE MILITARY DEPARTMENTS. IT ALSO APPEARS THAT THE AWARD WAS MADE IN ACCORDANCE WITH THE MORE SPECIFIC PROVISIONS OF ASPR 12-601 THROUGH 604, WHICH DEAL WITH CERTAIN OF THE REQUIREMENTS OF THE WALSH-HEALEY PUBLIC CONTRACTS ACT, 49 STAT. 2036, AS AMENDED, 41 U.S.C. 35-45.

BEFORE SUBMITTING ITS REPORT TO OUR OFFICE IN THE MATTER, THE DEPARTMENT OF THE ARMY REQUESTED THE DEPARTMENT OF LABOR TO REVIEW THE CONTRACTING OFFICER'S DETERMINATION THAT CONSOLIDATED TRANSFORMERS, UNLIMITED, WAS A MANUFACTURER AS REQUIRED BY SUBSECTION 1 (A) OF THE WALSH-HEALEY PUBLIC CONTRACTS ACT. APPARENTLY, IT WAS NOT NECESSARY TO REQUEST ANY SUCH REVIEW, EXCEPT POSSIBLY AS A MATTER OF POLICY, SINCE NO PROTEST REGARDING THE STATUS OF THE SUCCESSFUL OFFEROR AS A MANUFACTURER WAS FILED BEFORE AWARD OF THE CONTRACT AND IT HAS BEEN HELD THAT THE PURPOSE OF 41 U.S.C. 35 (A), ENACTED FOR THE BENEFIT OF THE GOVERNMENT, IS SPENT WHEN THE CONTRACT IS AWARDED. UNITED STATES V RUSSELL ELEC. CO., 250 F.SUPP. HOWEVER, THE DEPARTMENT OF LABOR, WAGE AND HOUR AND PUBLIC CONTRACTS DIVISIONS, ADVISED THE DEPARTMENT OF THE ARMY BY LETTER DATED AUGUST 18, 1969, THAT:

"BASED UPON THE INFORMATION PRESENTED TO US, WE FIND NO REASON TO QUESTION THE DECISION BY YOUR AGENCY THAT CONSOLIDATED TRANSFORMERS UNLIMITED IS ELIGIBLE TO RECEIVE THE CONTRACT RESULTING FROM THE ABOVE CITED RFP AS A MANUFACTURER.'

IT HAS BEEN OUR POSITION THAT CONTRACTING OFFICERS' DETERMINATIONS REGARDING THE INTERPRETATION OF SUCH TERMS AS "REGULAR DEALER" AND "MANUFACTURER" AS USED IN THE WALSH-HEALEY PUBLIC CONTRACTS ACT ARE SUBJECT TO REVIEW BY THE SECRETARY OF LABOR AND NOT BY THE GENERAL ACCOUNTING OFFICE. IN THAT CONNECTION, SECTION 38 OF TITLE 41, U.S.C. STATES THAT THE SECRETARY OF LABOR AND HIS AUTHORIZED REPRESENTATIVES SHALL HAVE THE POWER TO MAKE INVESTIGATIONS AND FINDINGS AS PROVIDED IN SECTIONS 35-45; AND THE SUPREME COURT OF THE UNITED STATES STATED IN ENDICOTT JOHNSON CORPORATION V PERKINS, 317 U.S. 501, THAT "CONGRESS SUBMITTED THE ADMINISTRATION OF THE ACT TO THE JUDGMENT OF THE SECRETARY OF LABOR, NOT TO THE JUDGMENT OF THE COURTS.'

SINCE THE CONTRACTING OFFICER'S DETERMINATION HAS BEEN SUSTAINED BY THE DEPARTMENT OF LABOR, NO FURTHER ACTION APPEARS TO BE REQUIRED BY OUR OFFICE IN THE MATTER. HOWEVER, WE ARE ENCLOSING FOR YOUR INFORMATION A COPY OF A LETTER DATED JULY 24, 1969, IN WHICH THE DEPARTMENT OF THE ARMY REQUESTED THE DEPARTMENT OF LABOR TO REVIEW THE CONTRACTING OFFICER'S DETERMINATION.