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B-176648, OCT 25, 1972

B-176648 Oct 25, 1972
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WHERE AN OFFEROR IS DETERMINED NOT TO BE A MANUFACTURER OR REGULAR DEALER UNDER THE WALSH-HEALEY ACT. NO DEFICIENCIES ARE NOTED IN ITS PROPOSAL. HE CANNOT CLAIM THAT HE WAS PREJUDICED BY INHERENT PROBLEMS IN THE SOLICITATION. RESPONSIBILITY FOR APPLYING WALSH-HEALEY ACT CRITERIA IS VESTED IN THE CONTRACTING OFFICER AND THE DEPARTMENT OF LABOR. IS NOT SUBJECT TO REVIEW BY GAO. 173298. INCORPORATED: REFERENCE IS MADE TO YOUR LETTER OF JULY 28. THE SUBJECT SOLICITATION WAS ISSUED ON SEPTEMBER 9. OFFERORS WERE REQUIRED TO INDICATE IN THEIR PROPOSALS THAT THEY WERE EITHER THE MANUFACTURER OF. YOU REPRESENTED IN YOUR PROPOSAL THAT YOU WERE A REGULAR DEALER. PROPOSALS WERE SUBMITTED BY OCTOBER 18.

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B-176648, OCT 25, 1972

BID PROTEST - WALSH-HEALEY ACT - INHERENT PROBLEMS OF SOLICITATION DECISION DENYING THE PROTEST OF HEWES ENGINEERING COMPANY, INC., AGAINST REJECTION OF ITS OFFER UNDER AN RFP ISSUED BY THE WARNER-ROBINS AIR MATERIEL AREA, ROBINS AFB, GA., FOR SERVICES AND SUPPLIES FOR REVISING TECHNICAL PUBLICATIONS. WHERE AN OFFEROR IS DETERMINED NOT TO BE A MANUFACTURER OR REGULAR DEALER UNDER THE WALSH-HEALEY ACT, BUT HAS OFFERED THE LOW PRICE, AND NO DEFICIENCIES ARE NOTED IN ITS PROPOSAL, HE CANNOT CLAIM THAT HE WAS PREJUDICED BY INHERENT PROBLEMS IN THE SOLICITATION. RESPONSIBILITY FOR APPLYING WALSH-HEALEY ACT CRITERIA IS VESTED IN THE CONTRACTING OFFICER AND THE DEPARTMENT OF LABOR, AND IS NOT SUBJECT TO REVIEW BY GAO. 173298, AUGUST 3, 1971.

TO HEWES ENGINEERING COMPANY, INCORPORATED:

REFERENCE IS MADE TO YOUR LETTER OF JULY 28, 1972, WITH ENCLOSURES, AND SUBSEQUENT CORRESPONDENCE, PROTESTING THE REJECTION OF YOUR OFFER UNDER REQUEST FOR PROPOSALS NO. F09603-72-R-0011, ISSUED BY THE WARNER ROBINS AIR MATERIEL AREA, ROBINS AIR FORCE BASE, GEORGIA.

THE SUBJECT SOLICITATION WAS ISSUED ON SEPTEMBER 9, 1971, AS A 100 PERCENT SET-ASIDE FOR SMALL BUSINESS FIRMS, FOR PROPOSALS COVERING SERVICES AND SUPPLIES FOR REVISING TECHNICAL PUBLICATIONS. PURSUANT TO THE WALSH-HEALEY PUBLIC CONTRACTS ACT, 41 U.S.C. 34-45, OFFERORS WERE REQUIRED TO INDICATE IN THEIR PROPOSALS THAT THEY WERE EITHER THE MANUFACTURER OF, OR A REGULAR DEALER IN, THE SUPPLIES OFFERED. YOU REPRESENTED IN YOUR PROPOSAL THAT YOU WERE A REGULAR DEALER.

PROPOSALS WERE SUBMITTED BY OCTOBER 18, 1971, AND IT WAS DETERMINED THAT YOUR FIRM OFFERED THE LOWEST PRICE. THE PROCURING ACTIVITY REQUESTED THE DEFENSE CONTRACT ADMINISTRATIVE SERVICES DISTRICT (DCASD) IN BIRMINGHAM, ALABAMA, TO CONDUCT A PREAWARD SURVEY OF YOUR FIRM. BASED UPON THE PREAWARD SURVEY, THE CONTRACTING OFFICER DETERMINED THAT YOUR FIRM DID NOT QUALIFY AS A MANUFACTURER OR REGULAR DEALER WITHIN THE MEANING AND INTENT OF THE WALSH-HEALEY ACT AND PARAGRAPHS 12-603.1 AND 12-603.2 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR). THE CONTRACTING OFFICER ADVISED YOU OF THE DETERMINATION BY LETTER DATED JANUARY 20, 1972. FURTHER, IN ACCORDANCE WITH ASPR 12-604(A)(2)(II), YOU WERE AFFORDED THE OPPORTUNITY TO SUBMIT EVIDENCE TO THE CONTRACTING OFFICER CONCERNING YOUR ELIGIBILITY. THE CONTRACTING OFFICER CONSIDERED THE ADDITIONAL EVIDENCE YOU SUBMITTED, BUT REMAINED OF THE VIEW THAT YOU WERE INELIGIBLE FOR AWARD.

IN A LETTER DATED FEBRUARY 15, 1972, YOU WERE ADVISED THAT THE MATTER OF YOUR ELIGIBILITY UNDER THE WALSH-HEALEY ACT WAS BEING REFERRED TO THE ADMINISTRATOR OF THE WAGE AND HOUR AND PUBLIC CONTRACTS DIVISION OF THE DEPARTMENT OF LABOR FOR A FINAL DETERMINATION. ON APRIL 11, 1972, THE DEPARTMENT OF LABOR DETERMINED THAT YOUR FIRM DID NOT QUALIFY AS EITHER A MANUFACTURER OR REGULAR DEALER WITHIN THE MEANING OF THE PUBLIC CONTRACTS ACT AND REGULATIONS ISSUED THEREUNDER (41 CFR 50 201.101).

ON APRIL 14, 1972, AN AWARD WAS MADE TO HARRY KAHN ASSOCIATES AT A TOTAL PRICE OF $420,794. IN YOUR LETTER OF JULY 28, 1972, TO OUR OFFICE PROTESTING THE REJECTION OF YOUR PROPOSAL, YOU STATED THAT YOU DID NOT AGREE WITH THE DISQUALIFICATION OF YOUR FIRM. (IN THIS CONNECTION, YOU HAVE INDICATED THAT THE MATTER WAS INITIALLY FORWARDED TO THIS OFFICE BY TELEGRAM DATED APRIL 12, 1972. HOWEVER, WE HAVE NO RECORD OF RECEIVING THIS TELEGRAM.)

YOU CONTEND THAT THE SOLICITATION WAS AMBIGUOUS AND NOT SUFFICIENTLY SPECIFIC TO ALLOW OFFERORS TO PARTICIPATE ON AN EQUAL BASIS, FAVORING THE INCUMBENT CONTRACTOR. FURTHER, YOU ALLEGE THAT THE PROCUREMENT WAS UNJUSTIFIABLY ESTABLISHED AS NEGOTIATED WHILE ACTUALLY BEING TREATED IN THE SAME RESPECT AS FORMAL ADVERTISING. YOU ALSO BELIEVE THAT THE CONTRACT WAS IMPROPERLY IDENTIFIED AS ONE FOR AN INDEFINITE QUANTITY. YOU SUPPORT YOUR CONTENTIONS BY ALLEGING SUNDRY OTHER IMPROPRIETIES IN THE CONSTRUCTION OF THE SOLICITATION WHICH YOU FEEL WORKED TO YOUR DISADVANTAGE.

IN REGARD TO THESE CHARGES, IT IS SIGNIFICANT TO RECOGNIZE THAT YOUR PROPOSAL WAS DETERMINED TO BE LOW IN REGARD TO PRICE. FURTHER, THE AIR FORCE FAILED TO NOTE ANY DEFICIENCIES IN YOUR PROPOSAL WHICH WOULD LEND SUPPORT TO THE PROPOSITION THAT INHERENT PROBLEMS IN THE SOLICITATION PREJUDICED YOUR PROPOSAL. THE FACT REMAINS THAT YOUR PROPOSAL WAS LOW AND NO CHALLENGE HAS BEEN MADE AS TO ITS RESPONSIVENESS. ACCORDINGLY, WE DOUBT WHETHER IT MAY BE SAID THAT YOU WERE PREVENTED FROM COMPETING FAIRLY BECAUSE OF THE CONSTRUCTION OF THE RFP.

FOR REASONS SET OUT BELOW, WE MUST CONCLUDE THAT THE REJECTION OF YOUR PROPOSAL IS NOT SUBJECT TO QUESTION BY OUR OFFICE. THE WALSH HEALEY ACT, 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. THE ACT, AS AMENDED, PROVIDES AT 41 U.S.C. 38 THAT THE SECRETARY OF LABOR SHALL HAVE AUTHORITY TO ADMINISTER THE PROVISIONS OF THAT 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."

THUS, RESPONSIBILITY FOR APPLYING THE CRITERIA OF THE WALSH-HEALEY ACT IS VESTED IN THE CONTRACTING OFFICER AND THE DEPARTMENT OF LABOR. OUR OFFICE IS NOT AUTHORIZED TO REVIEW DETERMINATIONS AS TO WHETHER PARTICULAR FIRMS ARE REGULAR DEALERS OR MANUFACTURERS WITHIN THE PURVIEW OF THE WALSH- HEALEY ACT BECAUSE SUCH DETERMINATIONS REST WITH THE CONTRACTING OFFICER SUBJECT TO FINAL REVIEW BY THE DEPARTMENT OF LABOR. B-173298, AUGUST 3, 1971; B-171426, APRIL 27, 1971; B-166905, JULY 24, 1969.

IN VIEW OF THE FOREGOING, NO FURTHER ACTION WILL BE TAKEN BY OUR OFFICE IN CONNECTION WITH YOUR PROTEST.

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