B-151133, MAY 7, 1963

B-151133, MAY 7, 1963

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO LETTER OF APRIL 23, 1963, FROM THE DIRECTOR OF PROCUREMENT AND PRODUCTION, HEADQUARTERS, UNITED STATES ARMY MATERIEL COMMAND, CONCERNING THE PROTEST OF ASPHALT EQUIPMENT O., INC., AGAINST THE DETERMINATION THAT IT IS NOT A REGULAR DEALER.

THE RECORD IN THIS CASE SHOWS THAT THE CONTRACTING OFFICER REACHED DIFFERENT CONCLUSIONS AS TO WHETHER ASPHALT EQUIPMENT CO., INC., WAS A REGULAR DEALER AND THAT THE MATTER OF THE COMPANY'S STATUS WAS REFERRED TO THE DEPARTMENT OF LABOR. THE CONTRACTING OFFICER'S DETERMINATIONS WERE REVIEWED BY THE ADMINISTRATOR OF THE WAGE AND HOUR AND PUBLIC CONTRACTS DIVISIONS. IN A MARCH 14 LETTER THE ADMINISTRATOR INFORMED THAT BASED ON THE FACTS AT THEIR DISPOSAL, THE DIVISIONS PERCEIVED NO GROUNDS FOR OVERTURNING THE ORIGINAL FINDING OF THE CONTRACTING OFFICER THAT THE COMPANY DID NOT QUALIFY AS A REGULAR DEALER. SUBSEQUENTLY, IN LETTER OF APRIL 12, THE ADMINISTRATOR REQUESTED THE U.S. ARMY MATERIEL COMMAND TO REINVESTIGATE THE COMPANY'S STATUS IN VIEW OF ADDITIONAL INFORMATION FURNISHED BY THE COMPANY "THAT WAS NOT AVAILABLE EITHER TO YOUR AGENCY OR TO THOSE DIVISIONS WHEN THE CONTRACTING OFFICER'S DECISION WAS REVIEWED.'

THE MATTER OF THE COMPANY'S STATUS IS IMPORTANT UNDER THREE INVITATIONS WHERE NO AWARD HAS BEEN MADE AS YET. THE LETTER OF THE DIRECTOR OF PROCUREMENT AND PRODUCTION INDICATES THAT IN THE OPINION OF THE COMMAND THE ADMINISTRATOR'S RULING OF MARCH 14 IS CONCLUSIVE OF THE COMPANY'S STATUS AND REQUESTS OUR DECISION.

THE WALSH-HEALEY PUBLIC CONTRACTS ACT OF JUNE 30, 1936, AS AMENDED, 41 U.S.C. 35, PROVIDES THAT, WITH CERTAIN EXCEPTIONS NOT HERE MATERIAL, EVERY CONTRACT EXCEEDING $10,000 IN AMOUNT ENTERED INTO BY ANY GOVERNMENT AGENCY FOR THE PROCUREMENT OF SUPPLIES SHALL CONTAIN A STIPULATION THAT THE CONTRACTOR IS A MANUFACTURER OF OR REGULAR DEALER IN SUCH SUPPLIES AND THAT ANY BREACH OF SUCH STIPULATION SHALL RENDER THE CONTRACTOR LIABLE FOR LIQUIDATED DAMAGES, AND CONSTITUTE GROUNDS FOR CANCELLATION OF THE CONTRACT. THE ACT, AS AMENDED, FURTHER PROVIDES AT 41 U.S.C. 38 THAT THE SECRETARY OF LABOR SHALL HAVE AUTHORITY TO ADMINISTER THE PROVISIONS OF THE ACT, AND TO MAKE SUCH RULES AND REGULATIONS AS MAY BE NECESSARY TO THAT END.

THE "WALSH-HEALEY PUBLIC CONTRACTS ACT RULINGS AND INTERPRETATIONS" NO. 3, PUBLISHED BY THE DEPARTMENT OF LABOR, STATES AT SECTION 29:

"/A) THE RESPONSIBILITY OF DETERMINING WHETHER OR NOT A BIDDER IS QUALIFIED AS A MANUFACTURER OR AS A REGULAR DEALER UNDER THE PUBLIC CONTRACTS ACT RESTS IN THE FIRST INSTANCE WITH THE CONTRACTING AGENCY. HOWEVER, ANY DECISION WHICH THE CONTRACTING OFFICER MIGHT MAKE IS SUBJECT TO REVIEW BY THE DEPARTMENT OF LABOR WHICH IS CHARGED WITH THE ADMINISTRATION OF THE ACT. THE DEPARTMENT OF LABOR MAY DETERMINE THE QUALIFICATIONS OF A BIDDER IN THE FIRST INSTANCE IN THE ABSENCE OF ANY DECISION BY THE CONTRACTING OFFICER.'

OUR OFFICE DOES NOT CONSIDER THAT IT HAS ANY AUTHORITY TO REVIEW DETERMINATIONS AS TO WHETHER PARTICULAR FIRMS ARE REGULAR DEALERS OR MANUFACTURERS. B-147620, JANUARY 22, 1962. RATHER, WE HAVE CONSIDERED THAT SUCH DETERMINATIONS REST WITH THE CONTRACTING OFFICER SUBJECT TO THE REVIEW OF THE DEPARTMENT OF LABOR WHICH HAS THE FINAL AUTHORITY. 148715, JUNE 25, 1962.

HOWEVER, WE ARE CONCERNED THAT EACH BIDDER ON GOVERNMENT PROCUREMENT HAS ITS BID AND ELIGIBILITY FOR AWARD FAIRLY AND COMPLETELY CONSIDERED, AS IT IS THROUGH SUCH PROPER CONSIDERATION THAT THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM IS MAINTAINED. THEREFORE, INASMUCH AS NO AWARD HAS BEEN MADE ON THE PROCUREMENTS INVOLVED IN THE IMMEDIATE CASE, THE ADMINISTRATOR'S MARCH 14 REVIEW OF THE CONTRACTING OFFICER'S DETERMINATIONS SEEMS TO HAVE BEEN BASED UPON LIMITED INFORMATION, AND THERE SEEMS TO BE ADDITIONAL INFORMATION WHICH HAS NOT BEEN CONSIDERED BY THE CONTRACTING OFFICER OR THE DEPARTMENT OF LABOR, WE WOULD HAVE NO OBJECTION IF THE QUESTION OF THE COMPANY'S STATUS WAS FURTHER INVESTIGATED AS THE ADMINISTRATOR HAS REQUESTED.