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OUR VIEWS AND RECOMMENDATIONS WERE REQUESTED ON A PROPOSED REVISION OF SECTION 1 2.407-6 OF THE FEDERAL PROCUREMENT REGULATIONS DEALING WITH PRIORITIES IN THE AWARD OF A CONTRACT WHEN EQUAL LOW BIDS HAVE BEEN SUBMITTED. THE PURPOSE OF THE PROPOSED REVISION IS TO IMPLEMENT AMENDMENT NO. 1 OF DEFENSE MANPOWER POLICY NO. 4. THE PROCUREMENT AGENCY IN MAKING AWARD WILL GIVE PREFERENCE TO THE FIRM EXPENDING A SUBSTANTIAL AMOUNT OF THE CONTRACT PRICE IN A LABOR SURPLUS AREA. THE MAJOR DIFFERENCE BETWEEN THE TWO IS THAT IN THE EXISTING VERSION PRIORITY POSITIONS ARE GIVEN TO CONCERNS WHICH. WE ARE IN ACCORD WITH THE PROPOSED REVISION SINCE UNDER THE EXISTING REGULATION IT WOULD BE POSSIBLE FOR A FIRM TO OBTAIN A HIGHER PRIORITY EVEN THOUGH AWARD TO ANOTHER FIRM WOULD RESULT IN MORE OF THE WORK BEING PERFORMED IN A LABOR SURPLUS AREA.

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B-129709, FEB. 25, 1963

TO ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

BY LETTER OF JANUARY 29, 1963, WITH ENCLOSURES, SIGNED BY THE DIRECTOR OF PROCUREMENT AND ECONOMIC POLICY, OUR VIEWS AND RECOMMENDATIONS WERE REQUESTED ON A PROPOSED REVISION OF SECTION 1 2.407-6 OF THE FEDERAL PROCUREMENT REGULATIONS DEALING WITH PRIORITIES IN THE AWARD OF A CONTRACT WHEN EQUAL LOW BIDS HAVE BEEN SUBMITTED.

AS POINTED OUT IN THE LETTER, THE PURPOSE OF THE PROPOSED REVISION IS TO IMPLEMENT AMENDMENT NO. 1 OF DEFENSE MANPOWER POLICY NO. 4, REVISED, 27 F.R. 12935, WHICH PROVIDES THAT, IN THE EVENT OF TIE BIDS, THE PROCUREMENT AGENCY IN MAKING AWARD WILL GIVE PREFERENCE TO THE FIRM EXPENDING A SUBSTANTIAL AMOUNT OF THE CONTRACT PRICE IN A LABOR SURPLUS AREA.

IN OUR LETTER B-129709, MAY 16, 1961, WE TOOK NO EXCEPTION TO THE PROPOSAL RESULTING IN THE REGULATION WHICH WOULD BE SUPERSEDED BY THE REVISION NOW PROPOSED. THE MAJOR DIFFERENCE BETWEEN THE TWO IS THAT IN THE EXISTING VERSION PRIORITY POSITIONS ARE GIVEN TO CONCERNS WHICH, ALTHOUGH OTHERWISE NOT QUALIFYING FOR PREFERENCE, WOULD DELIVER THE END ITEMS FROM AN ESTABLISHMENT IN A PERSISTENT LABOR SURPLUS AREA. THE PROPOSED REVISION WOULD ELIMINATE THAT PRIORITY. WE ARE IN ACCORD WITH THE PROPOSED REVISION SINCE UNDER THE EXISTING REGULATION IT WOULD BE POSSIBLE FOR A FIRM TO OBTAIN A HIGHER PRIORITY EVEN THOUGH AWARD TO ANOTHER FIRM WOULD RESULT IN MORE OF THE WORK BEING PERFORMED IN A LABOR SURPLUS AREA.

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