NAICS APPEAL OF: EYP SQUARED JOINT VENTURE, LLC, APPELLANT

*1 On November 22, 2019, the General Services Administration (GSA) issued Solicitation No. 47PJ0020R0006 requesting architectural and engineering services for the renovation of Building 53 located in the Denver Federal Center in Lakewood, Colorado. The Contracting Officer (CO) set aside the procurement entirely for small businesses and listed North American Industry Classification System (NAICS) code 541310, Architectural Services, with a corresponding $8 million annual receipts size standard for the procurement.

*1 On December 2, 2019, EYP Squared Joint Venture, LLC (Appellant) filed the instant appeal challenging the NAICS code designation. Appellant asserts that the correct NAICS code for this procurement is 541330, Engineering Services, with a corresponding $16.5 million annual receipts size standard. For the reasons discussed infra, the appeal is denied.

*1 The U.S. Small Business Administration (SBA) Office of Hearings and Appeals (OHA) decides NAICS code appeals under the Small Business Act of 1958, 15 U.S.C. § 631 et seq., and 13 C.F.R. parts 121 and 134. Appellant filed the instant appeal within ten calendar days after issuance of the solicitation, so the appeal is timely. Federal Acquisition Regulation (FAR) 19.303(c)(1); 13 C.F.R. §§ 121.1103(b)(1), 134.304(b). Accordingly, this matter is properly before OHA for decision.

*1 According to the Scope of Work provided in the Solicitation, the professional services will require at a minimum:

*2 (Solicitation, at 3.) The Scope of Work further described specifications for the project regarding space alterations; the interior space plan; daylighting strategies; the number of conference offices, conference spaces, huddle rooms, phone booths, and reception areas; and the need for conformance with certain agency standards including Leadership in Energy and Environmental Design (LEED) certification. (Id.)

*2 According to the Statement of Work (SOW), the GSA has been tasked with reconfiguring and renovating the space at Building 53 “to improve space utilization, optimize inventory, decrease reliance on leased space, and reduce the Government's environmental footprint.” (SOW, at 5.) The SOW explains that the building houses several different federal agencies, and three additional agencies will be occupying the building upon completion of the project. (Id.)

*2 The SOW requires the design to maximize space utilization and create an advanced and modern work environment. The design team will employ a “whole building” design approach. The contractor will “strive to deliver an award[[-]winning project which embraces the ethos of design excellence, advanced technology, and exhibits a high degree of ingenuity, and creativity.” (Id., at 7.)

*2 The SOW also provides specifications regarding the interior design which shall “support each agency's mission of excellence by developing a gathering place that facilitates a rich professional and community life.” (Id.) The interior should be efficient in the use and organization of spaces, circulation, and core functions. The design should include a balanced office space rather than an open office space. The SOW states the interior environment “should reflect the different agencies, but the design should be complementary” which may “tie to a larger way-finding design for the building, so the design is cohesive.” (Id.) The design should also “enhance occupant comfort, productivity, creativity, and general health and well-being.” (Id.) The SOW also requires the creation of branding throughout the building “so that as you pass through the building each agency's mission is highlighted.” (Id.)

*2 The SOW anticipates the creation of a new cafeteria and provides for specifications regarding its layout. Restrooms will need to be re-configured and updated to meet code and provide for the comfort of the building's occupants. (Id., at 8.) Building components and systems within the building are also in need of repair and/or replacement.

*2 The SOW also provides a list of the work activity for the project, under “Major Work Items” which includes: hazardous materials, structural, roof, architectural, vertical transportation, plumbing, mechanical, fire life safety, electrical, communications, security, exterior, and swing space. (Id., at 8-11.)

*3 With regards to “hazardous materials,” the contractor will hire a qualified industrial hygiene consultant to perform the requisite inspections in accordance with the applicable regulations and industry practices. (Id.) The ““structural” component consists of the repair of the foundation and floor slab as required throughout the building. (Id., at 9.) The “roof” component requires the removal, repair, and/or replacement of the entire roofing system.

*3 The “architectural” component includes: working with the backfill customer agency to update the program and look for efficiencies within each housing plan; create an overall program for the building “that creates a sense of place for the occupants and visitors,” including the relocation of the cafeteria and enhancement of the visitor's entrance; reconstruction and renovation of the main lobby; restroom upgrades; build out of vacant space; incorporating daylighting elements; and the creation of new utility, storage, and general use spaces. (Id.)

*3 The “vertical transportation” component requires a new elevator, the replacement of 3 elevators, and the replacement of handrails and staircases. The “plumbing” component includes the replacement of the hot water system, the chilled water system, and the sanitary sewer system; upgrading the plumbing fixtures; and providing updated utilities to accommodate increased tenant load. (Id., at 10.) The “mechanical” component includes an upgrade to the cooling and heating system, providing updated utilities, and an update to the building automation system and controls. The “fire life safety” component includes ensuring the existing interior staircases are code compliant, replacing the fire sprinkler system, and upgrading the fire alarm system.

*3 The “electrical” component of the project includes replacing the main electrical service and main distribution throughout the building; providing a new standby generator; upgrading the grounding system; replacing light fixtures, lighting controls, and related cabling; replacing electrical power devices, and cabling telephone and data systems; and providing updated utilities. (Id.) The “communications” component includes upgrading the telecommunications systems and raceways, installing new telecommunications, and updating utilities. The “security” component includes the required security film and systems. The “exterior” component requires the removal of exterior site features for a new parking lot; replacing brick façade and exterior doors; relocating utilities and providing lighting for the parking lot and signage; paving and landscaping; replacing all exterior windows; cleaning exterior walls; and repairing masonry. (Id., at 11.) The “swing space” component is temporarily required to house occupants adversely affected by the construction of the project.

*4 The “Project Goals” state that the contractor will build “dynamic partnerships and a cohesive team with all contracted parties and GSA”. (Id.) The contractor must design a project that uses innovative technology to capitalize on the characteristics of the building and “[s]elect systems and materials that not only improve performance, comfort, and are visually stunning; but are also cost effective, easily operated and maintained, with durability and longevity in-mind.” (Id., at 12.)

*4 Under the “Scope of Services” section, the SOW describes the services the contractor is required to complete at different phases of the project. (Id., at 26.) During the pre-design phase, the contractor will recommend the studies, surveys, and reports necessary to prepare for the design and construction phases. (Id.) The contractor must complete studies and reviews that will be submitted to the CO along with a complete set of design documents, including models, drawings, specification, and design narratives. During the design concept phase, the contractor's Lead Designer, Project Principal, and Manager shall present the design concept to GSA leadership. (Id., at 28.) During the design development phase, the contractor will complete reports on testing in areas such as: hazardous material sampling, acoustical testing and modeling, testing for corrosion and pitting, water penetration, lead testing, water sampling, and visioning sessions. (Id., at 30.)

*4 The contractor will assist the CO in preparing the solicitation for the procurement of the Construction Manager as Constructor (CMc). (Id.) In procuring the CMc, the contractor will serve as a non-voting member of the evaluation team. During the construction phase, the contractor will work with the CMc and Construction Manager as Agent (CMa) to provide construction administration services such as keeping files and records up-to-date, reviewing change requests, ensuring compliance of the general contractor's contract, and conducting periodic site walk-throughs. (Id., at 31-34.) The pre-turnover process requires the contractor to attend a pre-turnover meeting to identify materials and systems that may require special consideration for the efficient operation and maintenance of the facility. The contractor will conduct a final inspection; review all operations and maintenance manuals, warranties, guarantees, and certificates; and verify the final record documents during the turnover process. (Id., at 34.)

*4 On December 2, 2019, Appellant filed the instant appeal. Appellant argues “most of the work solicited consists of engineering, not architectural, work.” (Appeal, at 1.) Additionally, Appellant is adversely affected by the designation of NAICS code 541310 because it is ineligible under an $8 million size standard, but eligible under the $16.5 million size standard for NAICS code 541330, Engineering Services.

*5 Appellant contends, of the thirteen “Major Work Items” listed in the SOW, only one of the items is listed as “architectural” while nine of the items (hazardous materials, structural, vertical transportation, plumbing, mechanical, fire life safety, electrical, communications, and security) “can only be described as engineering services.” (Id., at 4.) Appellant argues GSA erred in assigning NAICS code 541310, Architectural Services, for this procurement because engineering services, not architectural services, account for the greatest percentage of the contract value. (Id.)

*5 Appellant argues, architectural services are utilized in the planning and design stage of building construction, “not in actually constructing a new building or renovating an existing building.” (Id., at 5.) Appellant contends NAICS code 541330 “fits squarely with the primary purpose of the Solicitation...by ‘upgrad[ing] building systems and fire suppression system, repair[ing] structural and architectural deficiencies, repairing existing elevators and install[ing] an additional elevator, abat[ing] hazardous materials, [and]improv[ing] landscaping as well as provid[ing] interior office space build out.”’ (Id.) Appellant emphasizes that the work required is for renovation of an already existing building. Appellant refers to the ““mechanical”, “electrical,” and “structural” components listed in the SOW and argues these requirements involve the application of engineering principles. (Id., at 5-6.) Appellant contends the overhaul of major systems, such as mechanical, plumbing, electrical, elevators, and fire suppression required to enhance sustainability utilize structural, civil, and environmental engineering services. (Id. at 6.)

*5 Appellant finds that architectural services are “merely ancillary” to the principal purpose of the procurement and comprises only 40% of the work required and not the principal purpose of the Solicitation. (Id.)

*5 On December 17, 2019, the CO responded to the appeal. In its response, the CO states, “[w]hile this project does have many components, the architect is to have the primary responsibility for the project management and oversight of this scope of work.” (Response, at 1- 2.) The CO explains that the architect will lead the project from the beginning to develop the vision which “will include attributes of a modern work environment as the building is being converted from a 70-year-old munitions warehouse to contemporary office space.” (Id., at 2.) The CO argues the architect is the contractor responsible for the majority of the work and “will spend more than the required time needed to support use of an Architecture [NAICS] code.” (Id.) The CO acknowledges that there are engineering aspects to the project, but “those disciplines will remain secondary to the overall intent and workload required of this project.” (Id.)

*6 The CO's designated code, NAICS Code 541310, Architectural Services, comprises:

*6 NAICS Manual, at 465

*6 Index entries which refer to this NAICS Code are:

*6 Id. at 665, 689.

*6 Id., at 465.

*6 Index entries which refer to this NAICS Code are:

*6 Id. at 654, 682, 703, 706, 713, 718, 719, 745, 749, 750, 775, 787, 797, 816, 822, 824, 829, 856, 936.

*7 Appellant has the burden of proving, by a preponderance of the evidence, all elements of its appeal. Specifically, Appellant must show that the CO's NAICS code designation is based upon a clear error of fact or law. 13 C.F.R. § 134.314; NAICS Appeal of Durodyne, Inc., SBA No. NAICS-4536, at 4 (2003). SBA regulations do not require the CO to select the perfect NAICS code. NAICS Appeal of Evanhoe & Assocs., LLC, SBA No. NAICS-5505, at 14 (2013). Rather, the CO must assign the NAICS code that best describes the principal purpose of the product or service being acquired in light of the industry descriptions in the NAICS Manual, the description in the solicitation, the relative value and importance of the components of the procurement making up the end item being procured, and the function of the goods or services being acquired. FAR 19.303(a)(2); 13 C.F.R. § 121.402(b). OHA will not reverse a NAICS code designation “merely because OHA would have selected a different code.” NAICS Appeal of Eagle Home Med. Corp., SBA No. NAICS-5099, at 3 (2009).

*7 Having examined the SOW, the descriptions in the NAICS Manual, and Appellant's appeal, I find the CO did not commit clear error in designating NAICS code 541310, Architectural Services, because it best describes the principal purpose of the services sought under the Solicitation.

*7 The services sought for the instant procurement fit squarely within the services described under NAICS code 541310, Architectural Services. The VA seeks to procure the design services for the renovation of Building 53, a 70-year-old facility once used as a munitions warehouse, which will be converted into office space for several federal agencies. Services provided under NAICS code 541310 include the planning and designing of industrial buildings and structures by applying knowledge of design, construction procedures, zoning regulations, building codes, and building materials. See supra, Section II.D.

*7 The requirement for design work is emphasized throughout the SOW. The SOW states that the design should maximize space utilization and create an advanced and modern work environment, that the contractor should “strive to deliver an award-winning project which embraces the ethos of design excellence, advanced technology, and exhibits a high degree of ingenuity, and creativity,” and that the design should “enhance occupant comfort, productivity, creativity, and general health and well-being.” See supra, Section II.A. In developing the design, the contractor should adhere to the specifications describing the necessity of light throughout the office workspaces. The design must also include the creation of a new cafeteria and the re-configuration of restrooms. Id. Thus, the Solicitation explicitly requires the design services provided under NAICS code 541310, Architectural Services.

*8 Appellant makes the distinction that the Solicitation seeks the renovation of an already- existing building. However, the NAICS Manual does not specify that design services provided under NAICS code 541310, Architectural Services, are only for buildings that are not yet in existence. Thus, I find no reason to conclude that the services provided under NAICS code 541310 cannot also apply to the renovation of an already-existing building.

*8 Appellant references the “Major Work Items” listed in the SOW to support its argument that the procurement is seeking services that are more aligned with NAICS code 541330, Engineering Services. However, a comprehensive review of the SOW establishes the requirements listed as “Major Work Items” are merely ancillary to the services sought by the Solicitation.

*8 OHA has reviewed NAICS code 541330 in the past. OHA has held NAICS code 541330 describes an industry where the establishments provide engineering services, including providing advice, feasibility studies, preparing preliminary and final plans, and inspecting and evaluating engineering projects. NAICS Appeal of Inkling Media Co., SBA No. NAICS-5054, at 10 (2009). OHA has found NAICS code 541330 appropriate for procurements calling for highly technical analyses. NAICS Appeal of Millennium Engineering and Integration Co., SBA No. NAICS-5309, at 8 (2011) (finding that the SOW called specifically for safety engineering, which required offerors to provide “technical responses to realistic safety-related scenarios.”) Further, NAICS code 541330, Engineering Services, covers services involving the design and utilization of machines, materials, and systems. NAICS Appeal of Rhinocorps, Ltd., SBA No. NAICS-4736, at 5 (2005).

*8 The SOW here does not seek technical services on this level. The central focus of this procurement is the design for the renovation of a building, which goes well beyond the services provided under NAICS code 541330, Engineering Services. The project will require the replacement of elevators and the water and sewer systems, an upgrade of the heating and cooling system, and the replacement of the main electrical service, generator, light fixtures, and other electrical devices. However, the SOW makes it clear that the VA is seeking a contractor to provide a design for the renovation of Building 53 and not the engineering services required to produce the items listed under the “Major Work Items” section in the SOW. Additionally, the VA's focus on sustainability for the project will merely color the design and materials selected for the renovation of the building and is not the essential service sought by this procurement.

*8 Under the “Project Goals” in the SOW, the contractor is to design a project that capitalizes on the characteristics of the building and “[s]elect systems and materials “that not only improve performance, comfort, and are visually stunning; but are also cost effective, easily operated and maintained, with durability and longevity in-mind.” See supra Section II.A. The VA is not seeking a contractor to design materials and systems, but to select materials and systems for the design of the renovation of Building 53 that will produce the VA's desired results. Further, under the “Scope of Services” section in the SOW, the VA describes the different phases of the project, which are all centered around the design and construction for the renovation of Building 53. Notably, a CMc and CMa will be procured to undertake the actual construction of the design provided by the contractor, and the contractor's role will be to assist in the administration of the construction to ensure adherence to the design. Id.

*9 I conclude that this case is very analogous to OHA's recent decision in NAICS Appeal of Paradigm Engineers and Constructors, PLLC, SBA No. NAICS-6040 (2019). There, OHA held that a procurement for design services for the renovation of a building that included the replacement of the heating, ventilating, and air-conditioning (HVAC) systems in the building was appropriately designated under NAICS code 541310, rather than NAICS code 541330. There, the principle purpose of the procurement was to obtain designs for the renovation of the building, not the engineering of the HVAC. Similarly, here the contractor will be selected to design the renovation project, and the therefore the appropriate NAICS code is 541310, Architectural Services.

*9 Appellant has failed to sustain its burden of establishing clear error in the CO's NAICS designation of NAICS code 541310.

*9 Appellant has the burden of proving that the CO committed a clear error of fact or law in designating NAICS code 541310 for this procurement and has not met its burden. For that reason, I AFFIRM the CO's NAICS code designation and find the appropriate NAICS code for this procurement is 541310, Architectural Services, with a corresponding $8 million annual receipts size standard, and DENY the instant appeal.

*9 This is the final decision of the Small Business Administration. See 13 C.F.R. § 134.316(d).