B-223558, SEP 2, 1986, OFFICE OF THE GENERAL COUNSEL

B-223558: Sep 2, 1986

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WHO IS UNDER A DUTY TO CONSIDER EVIDENCE QUESTIONING THE SIZE STATUS OF A POTENTIAL CONTRACTOR BEFORE MAKING AWARD. WE UNDERSTAND THAT YOU ARE INTERESTED IN WHETHER THE UNION OR ITS MEMBERS CAN PURSUE THEIR APPEAL WITH OUR OFFICE. WAS BASED UPON A COMPARISON OF THE ESTIMATED COST OF PERFORMING THE WORK IN-HOUSE WITH THE LOWEST PRICED. CRAWFORD WAS THE LOW BIDDER AND ITS BID WAS APPROXIMATELY 40 PERCENT LOWER THAN THE COST OF IN-HOUSE PERFORMANCE. THE APPEALS BOARD CONCLUDED THAT SOME QUESTIONED ACTIONS BY THE ARMY WERE NOT IMPROPER. THAT OTHER ISSUES WERE EXCLUDED FROM THE APPEALS PROCEDURE. " WHO ARE DEFINED IN THE ACT AS ACTUAL OR PROSPECTIVE BIDDERS OR OFFERORS IN THE PROTESTED PROCUREMENTS. 31 U.S.C.

B-223558, SEP 2, 1986, OFFICE OF THE GENERAL COUNSEL

CONTRACTS - PROTESTS - INTERESTED PARTY REQUIREMENT - TRADE ASSOCIATIONS, ETC. DIGEST: 1. GAO ADVISES A MEMBER OF CONGRESS THAT IT DOES NOT CONSIDER PROTESTS REGARDING OMB CIRCULAR A-76 COST COMPARISONS FILED BY UNIONS OR AFFECTED AGENCY EMPLOYEES BECAUSE THE STATUTORY DEFINITION OF "INTERESTED PARTIES" ELIGIBLE TO FILE BID PROTESTS WITH GAO UNDER THE COMPETITION IN CONTRACTING ACT OF 1984 DOES NOT ENCOMPASS UNIONS OR FEDERAL EMPLOYEES. CONTRACTS - SMALL BUSINESS CONCERNS - AWARDS - SMALL BUSINESS ADMINISTRATION'S AUTHORITY - SIZE DETERMINATION 2. GAO ADVISES A MEMBER OF CONGRESS THAT IT DOES NOT CONSIDER BID PROTEST ABOUT THE SMALL BUSINESS SIZE STATUS OF FIRMS SELECTED FOR FEDERAL CONTRACTS BECAUSE THE SMALL BUSINESS ADMINISTRATION HAS CONCLUSIVE STATUTORY AUTHORITY TO MAKE SMALL BUSINESS SIZE DETERMINATIONS. THE CONCERNED CONSTITUENT MAY RAISE THE QUESTION WITH THE CONTRACTING OFFICER, WHO IS UNDER A DUTY TO CONSIDER EVIDENCE QUESTIONING THE SIZE STATUS OF A POTENTIAL CONTRACTOR BEFORE MAKING AWARD.

THE HONORABLE JIM SASSER:

WE REFER TO YOUR LETTER OF JUNE 27, 1986, CONCERNING AN ADMINISTRATIVE APPEAL BY THE AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, LOCAL 2022, ABOUT THE DEPARTMENT OF THE ARMY'S PROPOSAL TO CONTRACT WITH CRAWFORD TECHNICAL SERVICES FOR OPERATIONS AND MAINTENANCE SERVICES AT THE CAMPBELL ARMY AIR FIELD, FORT CAMPBELL, KENTUCKY, RATHER THAN TO PERFORM THE SERVICES WITH FEDERAL EMPLOYEES. FROM DISCUSSIONS WITH JOHN GREEN OF YOUR STAFF, WE UNDERSTAND THAT YOU ARE INTERESTED IN WHETHER THE UNION OR ITS MEMBERS CAN PURSUE THEIR APPEAL WITH OUR OFFICE.

THE ARMY ISSUED THE SOLICITATION UNDER WHICH IT PLANS TO CONTRACT WITH CRAWFORD, NO. DAKF23-85-B-0106, IN CONNECTION WITH AN OFFICE OF MANAGEMENT AND BUDGET (OMB) CIRCULAR NO. A-76 COST COMPARISON. THE ARMY'S DECISION TO CONTRACT WITH A PRIVATE FIRM, RATHER THAN PROVIDE THE SERVICES ITSELF, WAS BASED UPON A COMPARISON OF THE ESTIMATED COST OF PERFORMING THE WORK IN-HOUSE WITH THE LOWEST PRICED, TECHNICALLY ACCEPTABLE BID. CRAWFORD WAS THE LOW BIDDER AND ITS BID WAS APPROXIMATELY 40 PERCENT LOWER THAN THE COST OF IN-HOUSE PERFORMANCE. AFTER THE ARMY ANNOUNCED A TENTATIVE AWARD TO CRAWFORD, AFGE LOCAL 2022 AND SEVERAL AIRFIELD EMPLOYEES APPEALED THIS DETERMINATION TO THE HEADQUARTERS, UNITED STATES ARMY FORCES COMMAND, FORT MCPHERSON, GEORGIA.

ON MAY 27, 1986 AN APPEALS BOARD AT FORT MCPHERSON DENIED THE APPEALS. THE APPEALS BOARD CONCLUDED THAT SOME QUESTIONED ACTIONS BY THE ARMY WERE NOT IMPROPER, THAT OTHER ISSUES WERE EXCLUDED FROM THE APPEALS PROCEDURE, AND THAT IN SOME CASES THE MATTERS RAISED DID NOT AFFECT THE RESULT OF THE COST COMPARISON. A MEMBER OF AFGE LOCAL 2022 THEN BROUGHT THIS MATTER TO YOUR ATTENTION AND ADDITIONALLY QUESTIONED WHETHER CRAWFORD MEETS THE SIZE STANDARD FOR A SMALL BUSINESS ELIGIBLE FOR AWARD OF THE CONTRACT.

UNDER THE COMPETITION IN CONTRACTING ACT OF 1984, OUR OFFICE CONSIDERS PROTESTS OF AGENCY PROCUREMENT ACTIONS FROM "INTERESTED PARTIES," WHO ARE DEFINED IN THE ACT AS ACTUAL OR PROSPECTIVE BIDDERS OR OFFERORS IN THE PROTESTED PROCUREMENTS. 31 U.S.C. SEC. 3551(2) (SUPP. III 1985); 4 C.F.R. SEC. 21.0(A) (1986). BECAUSE UNIONS AND AGENCY EMPLOYEES DO NOT FALL UNDER THE STATUTORY DEFINITION OF "INTERESTED PARTIES," THEY ARE NOT ELIGIBLE TO FILE PROTESTS WITH OUR OFFICE. NATIONAL FEDERATION OF FEDERAL EMPLOYEES LOCAL 2049, B-220838, OCT. 23, 1985, 85-2 CPD PARA. 454. ADDITION, WE DO NOT CONSIDER PROTESTS WHICH RAISE SMALL BUSINESS SIZE STATUS CONCERNS BECAUSE THE SMALL BUSINESS ADMINISTRATION (SBA) HAS CONCLUSIVE AUTHORITY TO MAKE SUCH DETERMINATIONS. 15 U.S.C. SEC. 637(B)(6) (1982); MARK DUNNING INDUSTRIES, INC., B-217500, JAN. 18, 1985, 85-1 CPD PARA. 68.

SBA REGULATIONS DO ALLOW FOR PROTESTS OF SIZE DETERMINATIONS. 13 C.F.R. SEC. 121.9 (1986). SIZE STATUS PROTESTS CAN BE MADE THROUGH THE CONTRACTING OFFICER, OR THE CONTRACTING OFFICER MAY RAISE SIZE STATUS QUESTIONS WITH THE SBA HIMSELF. ALSO, THE CONTRACTING OFFICER MUST QUESTION A FIRM'S SELF-CERTIFICATION THAT IT IS A SMALL BUSINESS WHEN INFORMATION WHICH IS INCONSISTENT WITH THAT CERTIFICATION COMES TO HIS ATTENTION BEFORE AWARD. TOWMOTOR CORP., B-220871, MAR. 4, 1986, 65 COMP.GEN. ***, 86-1 CPD PARA. 219. THEREFORE, THE UNION MAY, IF IT HAS NOT ALREADY, BRING WHATEVER INFORMATION IT HAS REGARDING CRAWFORD'S SIZE TO THE ATTENTION OF THE CONTRACTING OFFICER AT FORT CAMPBELL.

ALSO, WE NOTE THAT IF THE UNION AND AFFECTED EMPLOYEES ARE FINALLY UNSUCCESSFUL IN THEIR APPEALS TO THE ARMY OR SBA, THERE IS SOME PRECEDENT FOR FEDERAL DISTRICT COURTS TO CONSIDER CHALLENGES TO OMB CIRCULAR NO. A- 76 CONTRACTING-OUT DECISIONS, SEE INTERNATIONAL ASSOCIATION OF FIREFIGHTERS, LOCAL F-100 V. DEPARTMENT OF THE NAVY, 536 F.SUPP. 1254 (D.R.I. 1982), AND REVIEWING SBA SIZE DETERMINATIONS. SEE LLOYD WOOD CONSTRUCTION CO. V. SANDOVAL, 318 F.SUPP. 1167 (N.D. ALA. 1970).

COPIES OF THE CITED DECISIONS OF OUR OFFICE ARE ENCLOSED.