B-172165, SEP 3, 1971

B-172165: Sep 3, 1971

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CONTRACTS - SMALL BUSINESS SET-ASIDE - MACHETES ADVISING THAT THE DECISION OF THE GSA TO MAKE PROCUREMENTS OF MACHETES TOTAL SMALL BUSINESS SET-ASIDES IS WITHIN THE SOUND DISCRETION OF THE CONTRACTING AGENCY. SINCE RECENT SOLICITATIONS INDICATE THAT COMPETITION MAY HAVE BEEN MORE LIMITED THAN WAS PREVIOUSLY THE CASE. PROCUREMENT PERSONNEL HAVE BEEN INSTRUCTED TO DETERMINE WHETHER THE SET-ASIDE FOR THESE PROCUREMENTS SHOULD CONTINUE. ENCLOSED IS A COPY OF A LETTER DATED JULY 21. SECTION 15 OF THE SMALL BUSINESS ACT PROVIDES THAT SMALL BUSINESS CONCERNS SHALL RECEIVE ANY AWARD OR CONTRACT OR ANY PART THEREOF WHEN IT IS DETERMINED TO BE IN THE INTEREST OF ASSURING THAT A FAIR PROPORTION OF THE TOTAL PURCHASES AND CONTRACTS FOR PROPERTY AND SERVICES FOR THE GOVERNMENT IS PLACED WITH SMALL BUSINESS CONCERNS.

B-172165, SEP 3, 1971

CONTRACTS - SMALL BUSINESS SET-ASIDE - MACHETES ADVISING THAT THE DECISION OF THE GSA TO MAKE PROCUREMENTS OF MACHETES TOTAL SMALL BUSINESS SET-ASIDES IS WITHIN THE SOUND DISCRETION OF THE CONTRACTING AGENCY. SINCE RECENT SOLICITATIONS INDICATE THAT COMPETITION MAY HAVE BEEN MORE LIMITED THAN WAS PREVIOUSLY THE CASE, PROCUREMENT PERSONNEL HAVE BEEN INSTRUCTED TO DETERMINE WHETHER THE SET-ASIDE FOR THESE PROCUREMENTS SHOULD CONTINUE.

TO MR. S. A. MITCHELL, JR.:

WE REFER TO YOUR LETTER OF MARCH 8, 1971, WHICH REQUESTS OUR REVIEW OF THE POLICY OF THE GENERAL SERVICES ADMINISTRATION IN TOTALLY SETTING ASIDE MACHETE PROCUREMENTS FOR SMALL BUSINESS PARTICIPATION.

ENCLOSED IS A COPY OF A LETTER DATED JULY 21, 1971, TO OUR OFFICE FROM THE GENERAL COUNSEL OF THE ADMINISTRATION WHICH CONTAINS A REVIEW OF MACHETE PROCUREMENTS FOR THE PAST 5 YEARS.

AS INDICATED IN THE GENERAL COUNSEL'S LETTER, SECTION 15 OF THE SMALL BUSINESS ACT PROVIDES THAT SMALL BUSINESS CONCERNS SHALL RECEIVE ANY AWARD OR CONTRACT OR ANY PART THEREOF WHEN IT IS DETERMINED TO BE IN THE INTEREST OF ASSURING THAT A FAIR PROPORTION OF THE TOTAL PURCHASES AND CONTRACTS FOR PROPERTY AND SERVICES FOR THE GOVERNMENT IS PLACED WITH SMALL BUSINESS CONCERNS. SEE 15 U.S.C. 644 (1970). IN IMPLEMENTATION OF THIS POLICY, SECTION 1-1.706-5(A) OF THE FEDERAL PROCUREMENT REGULATIONS DIRECTS THAT:

"*** THE ENTIRE AMOUNT OF AN INDIVIDUAL PROCUREMENT OR CLASS OF PROCUREMENTS SHALL BE SET ASIDE FOR EXCLUSIVE SMALL BUSINESS PARTICIPATION WHERE THERE IS A REASONABLE EXPECTATION THAT BIDS OR PROPOSALS WILL BE OBTAINED FROM A SUFFICIENT NUMBER OF RESPONSIBLE SMALL BUSINESS CONCERNS SO THAT AWARDS WILL BE MADE AT REASONABLE PRICES. *** "

IT HAS BEEN THE CONSISTENT POSITION OF OUR OFFICE THAT THE DETERMINATION OF WHETHER A REASONABLE EXPECTATION OF SMALL BUSINESS COMPETITION EXISTS IS A MATTER WITHIN THE SOUND DISCRETION OF THE CONTRACTING AGENCY AND WE WILL NOT SUBSTITUTE OUR JUDGMENT IN THIS AREA IN THE ABSENCE OF A CLEAR SHOWING OF ABUSE OF DISCRETION. 45 COMP. GEN. 228 (1965); B-171693, APRIL 22, 1971.

FROM OUR REVIEW OF THE PRIOR MACHETE PROCUREMENTS OUTLINED IN THE GENERAL COUNSEL'S LETTER, WE CANNOT CONCLUDE THAT THE CONTRACTING AGENCY HAS ABUSED ITS DISCRETION. INSOFAR AS THE CONTINUED USE OF TOTAL SMALL BUSINESS SET-ASIDES FOR MACHETE PROCUREMENTS IS CONCERNED, WE MUST OBSERVE THAT, WHILE THE EXPERIENCE UNDER PRIOR PROCUREMENTS IS NOT TO BE IGNORED, THE DECISION TO SET ASIDE A PARTICULAR PROCUREMENT EXCLUSIVELY FOR SMALL BUSINESS PARTICIPATION SHOULD BE MADE ON THE BASIS OF THE CIRCUMSTANCES EXISTING AT THE TIME THE DECISION IS MADE. IN THIS REGARD, WE NOTE THE ADVICE IN THE GENERAL COUNSEL'S LETTER THAT BECAUSE RECENT SOLICITATIONS INDICATE THAT COMPETITION MAY HAVE BECOME MORE LIMITED THAN WAS PREVIOUSLY THE CASE, GENERAL SERVICES ADMINISTRATION PROCUREMENT PERSONNEL HAVE BEEN INSTRUCTED TO MAKE A COMPREHENSIVE ANALYSIS OF THE SITUATION FOR MAKING A DETERMINATION AS TO WHETHER THE SET-ASIDE FOR THESE PROCUREMENTS SHOULD CONTINUE.

IN VIEW OF THE FOREGOING, ANY ACTION BY OUR OFFICE AT THIS TIME WOULD BE INAPPROPRIATE.