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HAWES AND SYMINGTON: REFERENCE IS MADE TO YOUR LETTERS DATED FEBRUARY 26. THE BIDS WERE OPENED AT THE OFFICE OF THE DISTRICT ENGINEER. THE LOWEST BID WAS SUBMITTED BY B. WHICH WAS THE SECOND WORKING DAY AFTER BID OPENING. WAS NOTIFIED BY TELEGRAM OF THE ACCEPTANCE OF ITS BID. CALLED THE CONTRACTING OFFICE TO SAY THAT HE WAS PROTESTING THE AWARD TO B. HE WAS INFORMED THAT THE PROTEST WAS TOO LATE. A LETTER AND A TELEGRAM FORMALLY MAKING THE PROTEST WERE RECEIVED AT THE CONTRACTING OFFICE THE FOLLOWING DAY. THE BASIS FOR THE PROTEST WAS THAT THE AVERAGE ANNUAL RECEIPTS OF THE B. WAS NOT A SMALL BUSINESS CONCERN FOR GOVERNMENT CONSTRUCTION PROCUREMENT PURPOSES. THE BASIS FOR SUCH DETERMINATION WAS THAT THE RECEIPTS FROM A MANUFACTURING BUSINESS CONDUCTED BY THE DAYTON SURE-GRIP AND STORE CO.

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B-153616, APR. 21, 1964

TO FOWLER, LEVA, HAWES AND SYMINGTON:

REFERENCE IS MADE TO YOUR LETTERS DATED FEBRUARY 26, MARCH 2, AND MARCH 23, 1964, PROTESTING ON BEHALF OF TIMMONS, BUTT AND HEAD, INC., OF DAYTON, OHIO, THE AWARD OF A SMALL BUSINESS SET-ASIDE CONTRACT TO B. G. DENIS COMPANY, INC., OF DAYTON, OHIO, FOR THE CONSTRUCTION OF A SPECIAL RESEARCH BUILDING AT WRIGHT-PATTERSON AIR FORCE BASE, OHIO, UNDER INVITATION FOR BIDS NO. ENG-15-029-64-9 ISSUED JANUARY 3, 1964, BY THE CORPS OF ENGINEERS, U.S. ARMY.

THE BIDS WERE OPENED AT THE OFFICE OF THE DISTRICT ENGINEER, U.S. ARMY ENGINEER DISTRICT, LOUISVILLE, KENTUCKY, ON THURSDAY, FEBRUARY 13, 1964. THE LOWEST BID WAS SUBMITTED BY B. G. DANIS COMPANY, INC., WHICH CERTIFIED ITSELF TO BE A SMALL-BUSINESS CONCERN. ON MONDAY, FEBRUARY 17, 1964, WHICH WAS THE SECOND WORKING DAY AFTER BID OPENING, B. G. DANIS COMPANY, INC., WAS NOTIFIED BY TELEGRAM OF THE ACCEPTANCE OF ITS BID. LATER THAT SAME DAY THE PRESIDENT OF TIMMONS, BUTT AND HEAD, INC., CALLED THE CONTRACTING OFFICE TO SAY THAT HE WAS PROTESTING THE AWARD TO B. G. DANIS COMPANY, INC. HE WAS INFORMED THAT THE PROTEST WAS TOO LATE, SINCE THE AWARD HAD ALREADY BEEN MADE. A LETTER AND A TELEGRAM FORMALLY MAKING THE PROTEST WERE RECEIVED AT THE CONTRACTING OFFICE THE FOLLOWING DAY. THE BASIS FOR THE PROTEST WAS THAT THE AVERAGE ANNUAL RECEIPTS OF THE B. G. DANIS COMPANY, INC., AND ITS AFFILIATES FOR THE PRECEDING THREE FISCAL YEARS EXCEEDED $7,500,000, THE LIMIT PRESCRIBED BY THE SMALL BUSINESS ADMINISTRATION FOR SMALL BUSINESS CLASSIFICATION IN THE CONSTRUCTION INDUSTRY.

TIMMONS, BUTT AND HEAD, INC., SENT COPIES OF ITS PROTEST TO THE SMALL BUSINESS REGIONAL OFFICE, CLEVELAND, OHIO, WHICH INITIATED SIZE DETERMINATION PROCEEDINGS. ON FEBRUARY 27, 1964, THE SBA REGIONAL OFFICE DETERMINED THAT B. G. DANIS, COMPANY, INC., WAS NOT A SMALL BUSINESS CONCERN FOR GOVERNMENT CONSTRUCTION PROCUREMENT PURPOSES. THE BASIS FOR SUCH DETERMINATION WAS THAT THE RECEIPTS FROM A MANUFACTURING BUSINESS CONDUCTED BY THE DAYTON SURE-GRIP AND STORE CO., MIAMISBURG, OHIO, AN AFFILIATE OF B. G. DANIS COMPANY, INC., WERE PROPERLY FOR CONSIDERATION IN THE SIZE DETERMINATION, AND THAT THE AVERAGE ANNUAL RECEIPTS OF BOTH COMPANIES EXCEEDED $7,500,000 FOR THE THREE MOST RECENT FISCAL YEARS. THIS REVERSED AN SBA REGIONAL OFFICE DETERMINATION OF APRIL 25, 1963, THAT B. G. DANIS COMPANY, INC., WAS AT THAT TIME A SMALL BUSINESS FOR THE PURPOSE OF BIDDING ON GOVERNMENT CONSTRUCTION CONTRACTS. WE ARE ADVISED THE EARLIER SBA DETERMINATION THAT B. G. DANIS COMPANY, INC., WAS A SMALL BUSINESS WAS BASED ON SUBSTANTIALLY THE SAME INFORMATION APPEARING IN THE APPLICATION FOR SMALL BUSINESS SIZE DETERMINATION FILED BY DANIS ON WHICH THE LATER DECISION TO THE CONTRARY WAS BASED.

WE UNDERSTAND THAT EXECUTION OF A FORMAL CONTRACT WITH THE DANIS COMPANY BY THE CONTRACTING OFFICER AND ISSUANCE OF THE NOTICE TO PROCEED ARE CURRENTLY BEING HELD IN ABEYANCE.

YOU URGE THAT, IN VIEW OF THE SBA DETERMINATION THAT B. G. DANIS COMPANY, INC., IS NOT A SMALL BUSINESS CONCERN, IT WOULD BE CONTRARY TO SOUND PROCUREMENT PROCEDURES TO PERMIT THE AWARD OF THE INSTANT CONTRACT TO STAND AND FURTHER THAT THE "HASTE" WITH WHICH THE AWARD WAS MADE DEPRIVED YOUR CLIENT OF AN ADEQUATE OPPORTUNITY PRIOR TO AWARD TO MAKE THE INVESTIGATION WHICH RESULTED IN THE SUBJECT SBA DETERMINATION.

SECTION 1-703 OF THE ARMED SERVICES PROCUREMENT REGULATION PROVIDES THAT A CONTRACTING OFFICER IS REQUIRED TO ACCEPT AT FACE VALUE EITHER A SMALL BUSINESS CERTIFICATE OR A BIDDER'S SELF-CERTIFICATION IN THE ABSENCE OF A TIMELY WRITTEN PROTEST BY ANOTHER INTERESTED BIDDER. 41 COMP. GEN. 252. SIZE DETERMINATIONS OR CERTIFICATIONS BY SBA REMAIN EFFECTIVE UNTIL REVOKED. A CONTRACT AWARDED IN GOOD FAITH ON THE BASIS OF A BIDDER'S STATEMENT THAT IT IS A SMALL-BUSINESS CONCERN IS NOT VOID AB INITIO BUT IS VOIDABLE ONLY AT THE OPTION OF THE GOVERNMENT. OTIS STEEL PRODUCTS CORPORATION V. UNITED STATES, 316 F2D 937; B-137689, JULY 21, 1959, B- 148475, JUNE 13, 1962, B-147973, APRIL 9, 1962; 41 COMP. GEN. 252.

THE RECORD SHOWS THAT THE SELF-CERTIFICATION BY B. G. DANIS COMPANY, INC., WAS FULLY JUSTIFIED ON THE DATE OF THE AWARD. INASMUCH AS SBA HAD FORMALLY DETERMINED THAT SUCH BIDDER WAS A SMALL BUSINESS CONCERN FOR THE PURPOSE OF BIDDING ON GOVERNMENT CONSTRUCTION CONTRACTS LESS THAN A YEAR BEFORE, AND THAT DETERMINATION HAD NOT BEEN REVOKED, IT CANNOT BE SAID THAT B. G. DANIS COMPANY, INC., WAS IMPRUDENT OR LACKING IN GOOD FAITH WHEN IT CERTIFIED ITSELF AS SMALL BUSINESS. FURTHER, WE ARE UNABLE TO CONCLUDE THAT THE REFUSAL BY SBA, TEN DAYS AFTER CONTRACT AWARD, TO CERTIFY THE DANIS COMPANY AS A SMALL BUSINESS SHOULD BE CONSTRUED AS ESTABLISHING A PRIMA FACIE CASE THAT DANIS WAS NOT A SMALL BUSINESS CONCERN AT TIME OF AWARD. CF. B-153132, FEBRUARY 4, 1964. THUS, THE AWARD WAS MADE STRICTLY IN ACCORDANCE WITH THE APPLICABLE REGULATIONS.

WITH RESPECT TO YOUR CONTENTION THAT THE "HASTE" WITH WHICH THE AWARD WAS MADE DEPRIVED YOUR CLIENT OF AN ADEQUATE OPPORTUNITY PRIOR TO AWARD TO MAKE THE INVESTIGATION WHICH RESULTED IN THE PRESENT PROTEST, THE RECORD SHOWS THAT WHILE YOUR CLIENT PRIOR TO AWARD ORALLY QUESTIONED SUCH BIDDER'S SIZE, IT DID NOT AT THAT TIME STATE ANY FACTS TO SUPPORT ITS DOUBTS. THE RECORD ALSO SHOWS THAT B. G. DANIS COMPANY, INC., HAD BEEN AWARDED A SIMILAR CONTRACT AS A SMALL BUSINESS CONCERN ON FEBRUARY 10, 1964, WHICH WAS SEVEN DAYS PRIOR TO THE AWARD IN QUESTION, AND THAT YOUR CLIENT MADE NO PROTEST ALTHOUGH IT WAS THE THIRD LOW BIDDER UNDER THE INVITATION WHICH RESULTED IN THAT AWARD. IN VIEW OF SUCH EARLIER AWARD, IT WOULD APPEAR THAT THE NORMAL PROCEDURE TO WAIVE A SECOND PRE-AWARD SURVEY, WAS FOLLOWED AND THE AWARD WAS EXPEDITED IN THIS RESPECT.

IN THE CIRCUMSTANCES OF THIS CASE, WE FEEL THAT IT WOULD BE INEQUITABLE AND WOULD SERVE NO USEFUL PURPOSE TO REQUIRE CANCELLATION OF A CONTRACT AWARDED TO A BIDDER, WHO NOT ONLY CERTIFIED ITSELF AS A SMALL BUSINESS IN GOOD FAITH, BUT WHO, ON THE BASIS OF A RECENT PRIOR DETERMINATION OF SBA, HAD EVERY REASON TO BELIEVE THAT ITS SELF CERTIFICATION WAS CORRECT. ACCORDINGLY, WE MUST CONCLUDE THAT NO LEGAL BASIS EXISTS FOR OBJECTING TO THE AWARD OF THE CONTRACTOR TO B. G. DANIS COMPANY, INC., AND YOUR PROTEST IS DENIED.

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