B-148972, JUN. 15, 1962

B-148972, JUN. 15, 1962

TO SUSSHOLZ AND SADUR:

REFERENCE IS MADE TO YOUR LETTER OF MAY 21, 1962, REQUESTING US TO INSTRUCT THE DEPARTMENT OF THE NAVY THAT THE ONLY VALID AWARD WHICH CAN BE MADE UNDER SPECIFICATION NO. 31724/61 FOR THE CONSTRUCTION OF RADIO FACILITIES AT SAN JUAN, PUERTO RICO, IS TO MISSILE SITES, INC., AND ASSOCIATES.

THE BASIS FOR YOUR CONTENTION IS THE STATEMENT IN THE INVITATION FOR BIDS ON THE WORK IN QUESTION THAT "THIS INVITATION FOR BIDS HAS BEEN SET ASIDE FOR THE EXCLUSIVE PARTICIPATION OF SMALL BUSINESS CONCERNS. * * *" HOWEVER, THE COMPLETE PROVISION IN THE INVITATION CONTAINS THE FOLLOWING ADDITIONAL LANGUAGE:

HOWEVER, AS THIS PROJECT IS BEING ADVERTISED SIMULTANEOUSLY WITH WBY- 31727, A SIMILAR PROJECT IN THE CANAL ZONE, BIG BUSINESS CONCERNS WILL BE ELIGIBLE TO SUBMIT A COMBINED BID COVERING THE CONSTRUCTION OF BOTH FACILITIES.'

IT APPEARS THAT THE TWO PROJECTS MENTIONED ARE SIMILAR IN NATURE; THAT THE NAVY DEPARTMENT WAS NOT WILLING TO SET ASIDE THE PUERTO RICO PROJECT FOR EXCLUSIVE SMALL BUSINESS PARTICIPATION WITHOUT ASSURANCE THAT SUCH SET -ASIDE WOULD NOT INCREASE THE OVERALL COST OF BOTH PROJECTS; AND THAT AGREEMENT WAS REACHED BETWEEN THE NAVY AND THE SMALL BUSINESS ADMINISTRATION TO PROVIDE FOR THE CONDITIONAL SMALL BUSINESS SET-ASIDE OUTLINED ABOVE. WE DO NOT DISAGREE WITH YOUR CONTENTION THAT THE CONDITIONS IMPOSED UPON THE SET-ASIDE MADE IT UNLIKELY THAT THE PUERTO RICO JOB WOULD GO TO A SMALL BUSINESS CONCERN. WE DO NOT, HOWEVER, AGREE THAT THIS AFFECTS THE VALIDITY OF THE PROVISION.

UNDER THE PROVISIONS OF SECTION 644, TITLE 15, U.S.C. AND SECTION 1 706 OF THE ARMED SERVICES PROCUREMENT REGULATION IT IS PROVIDED THAT SMALL BUSINESS SHALL RECEIVE THE AWARD OF ANY CONTRACT AS TO WHICH IT IS DETERMINED JOINTLY BY THE CONTRACTING AGENCY AND THE SMALL BUSINESS ADMINISTRATION THAT SUCH AWARD WOULD EFFECTUATE THE STATED PURPOSES OF THE SMALL BUSINESS ACT. IT IS ENTIRELY TRUE THAT COMPLETE AND UNCONDITIONAL SMALL BUSINESS SET-ASIDES CAN BE AND OFTEN ARE MADE UNDER THIS AUTHORITY. HOWEVER, WE ARE AWARE OF NOTHING IN THE LAW OR REGULATIONS WHICH PROHIBITS THE MAKING OF A SMALL BUSINESS SET-ASIDE ON OTHER THAN AN UNCONDITIONAL BASIS. SECTION 644, TITLE 15, U.S. CODE, SPECIFICALLY PROVIDES FOR THE AWARD TO SMALL BUSINESS OF CONTRACTS "OR ANY PART THEREOF," AND THE AUTHORITY TO MAKE AN UNCONDITIONAL SET-ASIDE OF PART OR ALL OF CERTAIN WORK NECESSARILY, IN OUR OPINION, INCLUDES THE LESSER AUTHORITY TO MAKE SMALL BUSINESS SET ASIDES ON A CONDITIONAL BASIS. YOUR PROTEST ON THIS BASIS IS THEREFORE DENIED.

WITH RESPECT TO THE MATTERS PRESENTED IN YOUR LETTER OF MAY 25, 1962, THERE IS ENCLOSED A COPY OF OUR LETTER OF TODAY TO THE SECRETARY OF THE NAVY WHEREIN, FOR THE REASONS STATED, WE CONCLUDED THAT THE BID OF UHLHORN INTERNATIONAL, S.A., SHOULD BE CONSIDERED FOR AWARD.