B-151051, MAY 2, 1963

B-151051, MAY 2, 1963

TO NUCLEAR RESEARCH CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 19, 1963, CONCERNING THE QUESTION AS TO WHETHER YOU SHOULD RECEIVE CONSIDERATION BY THE DEPARTMENT OF THE NAVY FOR THE NEGOTIATION OF THE LABOR SURPLUS AREA SET-ASIDE PROCUREMENT IN INVITATION FOR BIDS NO. 600-503-63'S ISSUED ON OCTOBER 24, 1962.

YOU STATE THAT IT IS YOUR UNDERSTANDING THAT AT THE TIME OF OPENING OF BIDS THAT THE TWO FIRMS THAT BID LOWER THAN YOU FOR THE SET-ASIDE QUANTITY, WERE IN A LABOR SURPLUS AREA LESS CRITICAL THAN THE PHILADELPHIA AREA IN WHICH YOU ARE LOCATED.

AS YOU ARE AWARE, NEGOTIATION FOR THE SET-ASIDE PORTION OF THE PROCUREMENT WAS TO START AFTER THE AWARD OF THE NON-SET-ASIDE PORTION. ACCORDANCE WITH THE PROVISIONS OF ASPR 1-804.2 (B), THE INVITATION CONTAINS A PROVISION THAT THE PRIORITY FOR NEGOTIATION WILL BE BASED UPON THE LABOR SURPLUS CLASSIFICATION OF THE DESIGNATED PRODUCTION AREAS AS OF THE TIME OF THE PROPOSED AWARD AND NEGOTIATIONS WILL BE IN ORDER OF THE BIDS, BEGINNING WITH THE LOWEST RESPONSIVE BID OF A PARTICULAR GROUP. THE DEPARTMENT OF THE NAVY HAS REPORTED THAT THE LOW BIDDER, ELECTRO- NEUTRONICS, INC., AND YOU ARE "GROUP 3, CLASS D, CONCERNS.' WE HAVE FOUND THAT ONE BIDDER, ALTHOUGH CLASSIFIED AS A GROUP 1 CONCERN, WAS NOT ELIGIBLE FOR NEGOTIATION. SINCE ELECTRO NEUTRONICS, INC., IS ENTITLED TO PRIORITY IN THE CONSIDERATION FOR NEGOTIATION OF THE SET-ASIDE PROCUREMENT BY REASON OF QUOTING A LOWER PRICE THAN YOU DID, YOU MAY NOT BE CONSIDERED