B-170491, NOV. 9, 1970

B-170491: Nov 9, 1970

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A CONTRACTING OFFICER'S DETERMINATION TO SET-ASIDE A TOTAL PROCUREMENT FOR SMALL BUSINESS WHICH DETERMINATION WAS BASED ON LIST OF OVER 50 FIRMS INTERESTED IN THE PROCUREMENT. DETERMINATION BY SBA THAT THE TWO BIDDERS ARE SMALL BUSINESS IS NOT SUBJECT TO REVIEW BY GAO. SINCE EQUIPMENT IS FOR INSTALLATION OUTSIDE U.S. ARE NOT FOR APPLICATION AND THEREFORE REJECTION OF FOREIGN SOURCE BID IS NOT REQUIRED. INCORPORATED: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 29. DAAB07-70-B-0523 WHICH WAS ISSUED ON JUNE 25. FOR THE PURCHASE OF FIVE 68 FOOT DIAMETER METAL SPACE FRAME RADOMES WAS SET ASIDE EXCLUSIVELY FOR SMALL BUSINESS CONCERNS. YOU PROTEST THAT THE SPECIFICATIONS WERE NOT SUFFICIENTLY DETAILED AND THAT SELCO'S BID SHOULD BE REJECTED UNDER THE BUY AMERICAN ACT.

B-170491, NOV. 9, 1970

BID PROTEST - SMALL BUSINESS SET-ASIDE - BUY AMERICAN ACT DENIAL OF PROTEST BY LARGE BUSINESS FIRM AGAINST SMALL BUSINESS SET ASIDE OF PROCUREMENT OF RADOMES FOR DEPT. OF THE ARMY, AND AWARD TO SELCO-U.S., INCORPORATED. A CONTRACTING OFFICER'S DETERMINATION TO SET-ASIDE A TOTAL PROCUREMENT FOR SMALL BUSINESS WHICH DETERMINATION WAS BASED ON LIST OF OVER 50 FIRMS INTERESTED IN THE PROCUREMENT, MAY NOT BE REGARDED AS ARBITRARY OR UNREASONABLE AND FACT THAT ONLY TWO SMALL BUSINESS COMPANIES BID ON THE PROCUREMENT DOES NOT AFFECT THE SET-ASIDE. DETERMINATION BY SBA THAT THE TWO BIDDERS ARE SMALL BUSINESS IS NOT SUBJECT TO REVIEW BY GAO. SINCE EQUIPMENT IS FOR INSTALLATION OUTSIDE U.S., BUY AMERICAN ACT AND ASPR 6-104.4, ARE NOT FOR APPLICATION AND THEREFORE REJECTION OF FOREIGN SOURCE BID IS NOT REQUIRED.

TO KOPPERS COMPANY, INCORPORATED:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 29, 1970, AND SUBSEQUENT CORRESPONDENCE PROTESTING ANY CONTRACT AWARD UNDER SOLICITATION NO. DAAB07 -70-B-0523, ISSUED BY THE DEPARTMENT OF THE ARMY.

SOLICITATION NO. DAAB07-70-B-0523 WHICH WAS ISSUED ON JUNE 25, 1970, FOR THE PURCHASE OF FIVE 68 FOOT DIAMETER METAL SPACE FRAME RADOMES WAS SET ASIDE EXCLUSIVELY FOR SMALL BUSINESS CONCERNS. YOU PROTEST THIS TOTAL SET ASIDE FOR SMALL BUSINESS AS WELL AS THE SIZE OF THE TWO CONCERNS SUBMITTING BIDS, SELCO-U.S., INCORPORATED (SELCO) AND ELECTRONIC SPACE SYSTEMS CORPORATION (ESSCO). IN ADDITION, YOU PROTEST THAT THE SPECIFICATIONS WERE NOT SUFFICIENTLY DETAILED AND THAT SELCO'S BID SHOULD BE REJECTED UNDER THE BUY AMERICAN ACT.

THE PROTEST AGAINST A TOTAL SMALL BUSINESS SET-ASIDE IS BASED UPON YOUR BELIEF THAT THE CONTRACTING OFFICER DID NOT HAVE A BASIS FOR REASONABLY EXPECTING A SUFFICIENT NUMBER OF PROPOSALS FROM SMALL BUSINESS CONCERNS TO OBTAIN A REASONABLE PRICE AND THAT CERTAIN COMPONENTS OF THE RADOMES ARE AVAILABLE ONLY FROM LARGE BUSINESSES. RESPECTING THIS LATTER POINT THE FACT THAT SOME COMPONENTS MAY BE AVAILABLE FROM LARGE BUSINESS ONLY COULD NOT AFFECT THE VALIDITY OF A SET-ASIDE OR THE STATUS OF A PARTICULAR BIDDER SO LONG AS THE SMALL BUSINESS CONCERN MAKES A SUFFICIENT CONTRIBUTION, SUCH AS ASSEMBLY, TO THE END ITEM BEING OFFERED IN ITS BID. SEE B-168703, MARCH 26, 1970.

SIMILARLY, THE PROPRIETY OF A TOTAL SMALL BUSINESS SET-ASIDE IS NOT AFFECTED BY THE FACT THAT ONLY ONE OR TWO BIDS MAY BE RECEIVED. SEE B 157863, DECEMBER 6, 1965, AND B-164390, OCTOBER 22, 1965. RATHER ASPR 1- 706.5(A)(1) REQUIRES ONLY THAT THE CONTRACTING OFFICER DETERMINE THAT THERE IS A REASONABLE EXPECTATION THAT SUFFICIENT PROPOSALS WILL BE OBTAINED TO ASSURE A REASONABLE CONTRACT PRICE. SINCE YOU ADVISED THE CONTRACTING OFFICER THAT ONLY THREE COMPANIES PRODUCED THESE RADOMES, THE TWO BIDDERS AND YOURSELF, AND THAT ONLY THE OTHER TWO COMPANIES COULD BID, YOU BELIEVE IT WAS UNREASONABLE TO EXPECT SUFFICIENT PROPOSALS TO ASSURE A REASONABLE CONTRACT PRICE. WE HAVE BEEN ADVISED THAT THE METAL SPACE FRAME RADOME, ALTHOUGH NOT THE DIELECTRIC SPACE FRAME RADOME, WHICH IS BEING PROCURED WAS PRODUCED BY ATKINS AND MERRILL, MARLBORO, MASSACHUSETTS, AND H. I. THOMPSON, INCORPORATED, GARDENA, CALIFORNIA, AND THAT IN ADDITION TO THOSE CONCERNS IT IS PRODUCED BY GEONAUTICS, INCORPORATED, GOODYEAR AEROSPACE CORPORATION, NORTH AMERICAN ROCKWELL CORPORATION, SELCO AND ESSCO. APPARENTLY SOME OF THOSE COMPANIES WOULD HAVE BEEN ELIGIBLE TO BID ON THIS SET-ASIDE. ADDITIONALLY, THE CONTRACTING OFFICER BASED HIS DETERMINATION TO SET ASIDE THIS PROCUREMENT ON A LIST OBTAINED FROM THE INDUSTRIAL SECURITY BRANCH OF THE FORT MONMOUTH PROCUREMENT DIVISION WHICH CONTAINED THE NAMES OF OVER FIFTY SMALL BUSINESS CONCERNS INTERESTED IN THE PROCUREMENT OF RADOMES. THEREFORE, WE CANNOT CONCLUDE THAT THE CONTRACTING OFFICER'S DETERMINATION WHICH MUST BE PROSPECTIVE IN NATURE, EVEN IN VIEW OF YOUR ADVICE, WAS CLEARLY ARBITRARY OR UNREASONABLE.

YOU ALSO PROTESTED THAT SELCO AND ESSCO ARE NOT SMALL BUSINESS CONCERNS SINCE THEY ARE DOMINANT IN THE FIELD OF OPERATION. THIS ISSUE HAS BEEN RESOLVED BY THE SMALL BUSINESS ADMINISTRATION SIZE APPEALS BOARD WHICH HAS RULED THOSE CONCERNS ARE SMALL BUSINESSES AND NOT DOMINANT IN THIS FIELD OF OPERATION. THAT DETERMINATION IS CONCLUSIVE AS A MATTER OF LAW AND NOT SUBJECT TO OUR REVIEW. SEE 15 U.S.C. 637(B)(6).

FINALLY, YOU PROTESTED THAT THE SPECIFICATIONS WERE NOT SUFFICIENTLY DEFINITE TO PERMIT COMPETITION AND THAT SELCO'S BID SHOULD BE REJECTED UNDER ASPR 6-104.4 BECAUSE IT WAS FROM A FOREIGN SOURCE. ASPR 6-104.4 WHICH IMPLEMENTS THE BUY AMERICAN ACT, 41 U.S.C. 10, IS NOT APPLICABLE TO THIS PROCUREMENT SINCE THE RADOMES ARE FOR INSTALLATION OUTSIDE OF THE UNITED STATES AND IN ANY CASE THAT REGULATION DOES NOT REQUIRE REJECTION OF FOREIGN BIDDERS BUT ONLY PROVIDES FOR A DIFFERENTIAL TO BE ADDED TO SUCH BIDS. IN RESPECT TO THE LACK OF DEFINITE OR SUFFICIENTLY DETAILED SPECIFICATIONS YOU STATE THAT CERTAIN REQUIREMENTS ARE BASED ON THE ESSCO MAINTENANCE MANUAL WHICH IS NOT AVAILABLE TO OTHER BIDDERS AND THEREBY PREVENTS OTHER BIDDERS FROM SUBMITTING BIDS. THE SHORT ANSWER TO THIS PROTEST IS THAT SELCO DID IN FACT BID AND HAS STATED THEY HAD NO DIFFICULTY IN UNDERSTANDING WHAT WAS REQUIRED BY THE SPECIFICATIONS. ANY CASE THE ESSCO MANUAL WAS AVAILABLE TO ALL BIDDERS AT THE CONTRACTING OFFICER'S OFFICE.

FOR THE ABOVE REASONS YOUR PROTEST MUST BE DENIED.