SBA No. 2933SBA No. 2933August 5, 1988

SBA No. 2933 (S.B.A.), SBA No. 2933, 1988 WL 219838
Small Business Administration (S.B.A.)
Office of Hearings and Appeals
[Size Appeal]
*1 Docket No. SIZ-88-7-1-90
*1 Solicitation No. N66001-86-R-0411

*1 Department of the Navy

*1 Naval Oceans Systems Center

*1 San Diego, California

*1 August 5, 1988


The Office of Hearings and Appeals does not have jurisdiction to consider whether changes in an offer complying with an amendment to a solicitation require a new self-certification of size status.
ANDRETTA, Administrative Judge, Presiding:
*1 This appeal of a size determination is decided pursuant to the Small Business Act of 1958, 15 U.S.C. 631 et. seq., and the regulations codified at 13 CFR Part 121.
*1 The issue is whether the Office of Hearings and Appeals has jurisdiction to decide whether amendments to a solicitation constitute a new solicitation and, accordingly, require a new self-certification of size status.
*1 On December 10, 1986, the Contracting Officer (KO) of the Naval Oceans Systems Center in San Diego issued the above-cited solicitation for digital systems quality assurance support services. The solicitation was totally set aside for small business and was classified under Standard Industrial Classification (SIC) code 8911. This classification bears a size standard of $13.5 million, meaning that, to be eligible for award of the contract, a firm and any affiliates may not have combined average annual receipts for the previous three fiscal years in excess of $13.5 million.
*1 Offers on the solicitation were originally due by January 20, 1987,1 but this date was extended to February 2, 1987 by amendment 0002 of January 9, 1987. On September 2, 1987 amendment 0004 was issued, stating as follows:
*1 This Amendment supercedes all previous Amendments. The above cited solicitation has been amended to reflect a change in contract type. The contract type has been changed to an indefinite delivery type contract with provisions for placing both cost plus-fixed-fee and firm fixed price delivery orders. It is requested that your cost proposals be revised to reflect this type contract. Additionally the new contract start date will be 1 March 1988. If this change has any impact on personnel initially proposed please submit new resumes for review.
*1 Your revised offer shall be received by 3 pm (local time) 23 September 1987.
*1 Amendment 0005 changed the offer date to September 30, 1987, and amendment 0006 of September 18, 1987, states as follows, in pertinent part:2
*1 The purpose of this Amendment is to clarify the intent of Amendment 0004 and to provide answers in response to questions received regarding Amendment 0004.
*1 With respect to the revised solicitation forwarded with Amendment 0004, it is not necessary that the certifications and representations contained in Section K be completed. The offerors [sic] responses to the original Section K that was initially submitted will suffice. The intent of providing a revised solicitation was to communicate the terms and conditions of the anticipated contract.
*2 On May 13, 1988, the Contracting Officer notified the offerors that Advanced Digital Systems, Inc. (ADS) was the apparent successful offeror. By letter dated May 27, 1988 to the KO Expertware, Inc. (Expertware) protested the size status of ADS. The allegations of the protest were that ADS had become affiliated with Titan Corporation (Titan), an undisputed other-than-small concern, when the latter purchased ADS subsequent to the original date of self-certification (February 2, 1987), and that new representations and certifications should have been required because of amendment 0004 to the solicitation. Expertware's position was that ADS had lost its status as a small business concern prior to February 2, 1987 by beginning merger negotiations prior to that date, and should have certified its new size status at the time of solicitation amendment 0004. The KO referred this protest to The Small Business Administration's (SBA) Regional IX Office (RO) in San Francisco by letter dated June 2, 1988, and requested that a size determination be made of ADS.
*2 On June 20, 1988, the RO issued its determination finding ADS to be a small business under the size standard of the Navy's solicitation. In reaching this conclusion, the RO noted that size status is determined as of the date of self-certification, which was February 2, 1987 for ADS, and that ADS's officials had sworn that negotiations and agreements to merge had taken place after that date. The RO did not address the issue of whether new certification of size status was made necessary by the amendments to the solicitation beyond noting that, ‘The solicitation was amended September 2, 1987 and September 18, 1987, specifically providing that a new certification was not required’ and that ‘while a GAO protest has been filed requesting that all offerors be required to recertify, the record date of self-certification is February 2, 1987 and size is determined on [sic] that date.’3
*2 Expertware filed this appeal on June 28, 1988, and supplemented its arguments on July 14, 1988. It argues that where there is a negotiated procurement and a change in the type of contract necessitates the government's issuance of an entirely new solicitation package which requests offerors to submit new proposals, the appropriate date for determining a concern's size status should be the submission date of the revised proposals. Expertware bases this conclusion on its view that amendment 0004, in changing the contract from a cost reimbursement contract to one that would be partially firm fixed price, was a significant change, particularly since it allowed each offeror to reprice both the cost reimbursement and fixed price portions, and that such a significant change constitutes resolicitation and, thus, requires new self-certifications. Expertware's legal basis for this argument evolves out of its reading of 13 CFR 121.5(a) where it states in pertinent part that ‘. . . the size status of a concern (including its affiliates) is determined as of the date of its written self-certification as part of the concern's submission of a bid or offer.’ It argues that our previous decisions, made in the context of negotiated procurements,4 should be limited to best and final offers (BAFO) and that the word ‘offer’ in the regulation should be newly interpreted to include revised proposals; i.e., ‘recertification should be required where revised proposals have been requested following a material change in the contract.’ Expertware further claims that, in accordance with 13 CFR 121.3(a)(iv), a letter of intent to merge with Titan, written by ADS and dated May 8, 1987, created a presumption of affiliation between the two as of that date. Thus, according to Expertware, ADS was other-than-small as of May 1987 and was required to self certify as to size in September, 1987, when the revised offers were due.
*3 On July 12, 1988, Titan filed its response to the appeal, stating that ADS denies Expertware's claims and urging affirmation of the size determination. Titan's legal argument is that ADS properly submitted its self-certification with its proposal on February 2, 1987, and that there are no requirements in the regulations for recertification during the procurement process. Titan maintains that amendments to a request for proposals are not unusual, do not constitute a new proposal, and therefore do not require new self certification. Titan further argues, in the alternative, that the amendments to this solicitation in particular did not make material changes to the solicitation, and that ADS did not need to alter its pricing, personnel, or technical data on the basis of its affiliation with Titan.
*3 On July 25, 1988, attorneys for ADS, who had not previously filed pleadings in this case, filed a Motion For Enlargement Of Time and an Alternative Motion to Strike. The motion for time requests that the record remain open until July 29, 1988, to afford ADS an opportunity to respond to Expertware's Appellant's Supplemental Arguments, which were filed on July 14, 1988, two days before the record closing date. The alternative motion to strike asks that the Supplemental Arguments be striken from the record because they were received by ADS ‘following the close of record on July 15, 1988.’ The attorneys for ADS claim that ADS has been ‘prejudiced because material has been filed in this appeal which it has not had an opportunity to respond to. . . .’
*3 The regulation codified at 13 CFR 121.11(i) requires any response to an appeal to be made by interested parties within five days of receipt of the Notice of Appeal. To be confident of a date certain and of actual service of the Notice of Appeal, this Office serves its own Notice, with a copy of the Notice of Appeal, to the apparent interested parties. Moreover, to this end and to account for any delays in the mail, this Office changes the time provided in the rule to 15 calendar days and calculates the record closing date from the date of its own service. The regulation codified at 13 CFR 121.11(j) permits further enlargements of time for good cause, but requires a motion for enlargement of time to be made within the original time period to which it applies. This Office's Notice specifically states that an extension of the time within which to respond to an appeal may be granted if good cause is shown in writing prior to the expiration of the 15-day period. The ADS motion for additional time comes nine days late even by the enlarged time standard. Accordingly, the Motion For Enlargement Of Time is DENIED.
*3 The regulation codified at 13 CFR 121.11(i), while permitting an opportunity for interested parties to make statements in support of or opposition to the appeal, does not provide for endless responses by the parties to each other's statements. Moreover, in this case, Appellant's Supplemental Arguments are not, on their face, prejudicial in any way to ADS, and they do not differ substantially from the arguments contained in the Notice of Appeal. Accordingly, the Motion To Strike is DENIED.
*4 The regulation codified at 13 CFR 121.5(a) requires, in pertinent part, that:
*4 . . . the size status of a concern (including its affiliates) is determined as of the date of its written self-certification as a small business as part of the concern's submission of a bid or offer.
*4 Expertware's argument is that the KO should have treated ADS's revised offer as a new offer and, accordingly, should have required a new self-certification of size status in place of the one made on February 2, 1987. Since ADS merged with Titan, a large business, as of May, 1987, this would preclude ADS from being awarded the contract.
*4 The regulation codified at 13 CFR 121.11(a) provides this Office with jurisdiction limited to deciding appeals of determinations of size status and classifications of solicitations for government product or service procurements. We have frequently held this regulation to mean that this Office does not have jurisdiction to consider the issue whether a procurement should be set aside for small business or remain unrestricted and that ‘such matters are reserved for the Contracting Officer's discretion.’ SIC Appeal of Dragon Services, Inc., No. 2690 (1987); Size Appeal of Astronautics Corporation of America, No. 2300 (1985). The issue raised in this appeal, whether changes to a solicitation require a new offer, rather than merely changes to an offer, and, accordingly, whether such new offer would therefore require a new self certification of size status, is part of the question whether a procurement should be set aside for small business. It is, as such, a matter solely in the discretion of the Contracting Officer and not justiciable by this Office.
*4 We do, however, retain jurisdiction to decide as of what date, under the circumstances of a case, a size status should be determined. The regulation codified at 13 CFR 121.5(a) specifically states that the size status of a firm, including its affiliates, is determined as of the date of its written self certification. We have so held in cases, such as this, where the firm in question acquires an affiliate after self certification. See Size Appeal of Bastion Industries Corporation, No. 2538 (1986). We have also so held in cases involving a BAFO date, which are closely analogous to this case. See General Offshore Corporation, No. 2413 (1986); Aquidneck Management Association, Ltd., No. 2256 (1985). There is no reason to stray from this rule in this case.
*4 The determination that ADS is a small business for this procurement is AFFIRMED; the appeal is DENIED.
*4 This constitutes the final decision of the Small Business Administration. See 13 CFR 121.11(t), (u) and (v).
*4 Robert A. Andretta (Presiding)
*4 Administrative Judge
*4 Joseph K. Riotto (Concurring)
*4 Administrative Judge
*4 Usher, Administrative Judge, Concurring:
*4 I find the reasoning on page 6 incongruent, but, nevertheless, agree with the result.
*4 Benjamin G. Usher
*4 Administrative Judge


The original solicitation stated the due date to be January 20, 1987, but this was corrected by amendment 0001 of December 18, 1986.
Amendments 0003 and 0005 are not material to this decision.
In Matter of Expertware, Inc., B-231629, July 13, 1988, the General Accounting Office's (GAO) Deputy Associate General Counsel dismissed the protest in light of SBA's ‘conclusive authority to determine small business status for federal procurement purposes . . .’, citing 15 U.S.C. § 637(b)(6) (1982) and Newgard Industries, Inc.—Reconsideration, B-226272.2, April 17, 1987, 87-1CPD para. 422.
Appellant cites Size Appeal of Aquidneck Management Association, Inc., No. 2256 (1985) and Size Appeal of Support Systems Associates, Inc., No. 1720 (1983).
SBA No. 2933 (S.B.A.), SBA No. 2933, 1988 WL 219838
End of Document