[Federal Register Volume 59, Number 218 (Monday, November 14, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-28053]


[[Page Unknown]]

[Federal Register: November 14, 1994]


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COMMITTEE FOR PURCHASE FROM PEOPLE WHO ARE BLIND OR SEVERELY DISABLED
 

Procurement List Addition

AGENCY: Committee for Purchase From People Who Are Blind or Severely 
Disabled.

ACTION: Addition to the Procurement List.

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SUMMARY: This action adds to the Procurement List a commodity to be 
furnished by nonprofit agencies employing persons who are blind or have 
other severe disabilities.

EFFECTIVE DATE: December 14, 1994.

ADDRESSES: Committee for Purchase From People Who Are Blind or Severely 
Disabled, Crystal Square 3, Suite 403, 1735 Jefferson Davis Highway, 
Arlington, Virginia 22202-3461.

FOR FURTHER INFORMATION CONTACT: Beverly Milkman (703) 603-7740.

SUPPLEMENTARY INFORMATION: On September 2, 1994, the Committee for 
Purchase From People Who Are Blind or Severely Disabled published 
notice (59 F.R. 45666) of proposed addition to the Procurement List. 
Comments were received from one of the current contractors for the 
litter during the development phase of the proposal to add the litter 
to the Procurement List. This contractor indicated that addition of the 
litter to the Procurement List would have catastrophic consequences for 
the company, which is totally dependent on sales to the Government, 
particularly the Defense Personnel Support Center (DPSC), which buys 
the litter from this contractor. According to the contractor, loss of 
the ability to supply the litter to the Government, along with other 
losses due to reduced Government purchasing, will result in significant 
layoffs of the contractor's personnel in a labor surplus area and will 
place the company's ability to survive in jeopardy. This contractor 
also noted that it had made a substantial investment in tooling and 
fixtures to make the litter.
    The other current contractor for the litter contacted the Committee 
after the comment period for the proposal to add the litter to the 
Procurement List had ended. This contractor provided data to support 
its claim of being a longtime supplier of the litter. The contractor 
questioned the adequacy of notice to it of the Committee's proposal to 
add the litter to the Procurement List, and challenged the propriety of 
the Committee's determinations on the suitability of the nonprofit 
agency to produce the litter and the impact of the action on the 
contractor. The contractor also claimed that addition of the litter 
would have an adverse impact on national security.
    The second contractor also indicated that it had Government sales 
of the litter outside of DPSC, which the Committee initially believed 
bought all the Government requirement for this litter for distribution 
to other agencies. As the Committee's proposal was based on the DPSC 
requirement for the litter, the Committee has decided to limit its 
addition of this litter to the Procurement List to the DPSC 
requirement, rather than the total Government requirement as originally 
proposed. This will also limit the effect of the Committee's action on 
the two contractors, as the Government market outside DPSC will remain 
available for them to compete to supply.
    In order to gauge the likely impact on the two contractors of 
adding the DPSC requirement for the litter to the Procurement List in a 
period of declining Government purchases, the Committee has acquired 
DPSC data concerning its purchases of the litter since 1988 (all from 
the two commenting contractors). The Committee has determined impact on 
the two contractors by assigning each of them a portion of the 
estimated requirement for the litter for next year in proportion to the 
average percentage of the requirement which they supplied during that 
period, and by applying the portion to the latest sales data and 
projections provided by each contractor, in one case through a 
financial reporting service to which the Committee subscribes.
    Using this approach, the percentage of each contractor's total 
sales which it would lose is not high enough to constitute severe 
adverse impact, in the Committee's estimation. Consequently, the 
Committee does not believe its action will jeopardize the survival of 
either company. As to the possible displacement of workers in a labor 
surplus area, the addition of the litter to the Procurement List will 
create jobs for blind people, whose unemployment rate far exceeds that 
of nondisabled workers, even in labor surplus areas.
    Under the competitive bidding system, no contractor is guaranteed a 
contract with the Government to supply an item. A decision to make an 
investment in tooling and fixtures to produce an item thus requires a 
business to assume a certain amount of risk. In this case, the first 
contractor did not get the previous contract for the litter and has not 
indicated that it will be unable to use its tooling and fixtures to 
produce litters commercially. Consequently, the Committee does not 
believe that addition of the Government requirement for the litter to 
the Procurement List will severely impact the contractor in this 
regard.
    The second contractor's challenge to the propriety of the 
Committee's notice is that the Committee did not give it actual notice 
of the proposal and that the notice published in the Federal Register 
did not provide sufficient detail to allow the contractor to evaluate 
the suitability of the litter for inclusion on the Procurement List. 
When it adds items to the Procurement List, the Committee is required 
to use a rulemaking process set forth in 5 U.S.C. 553 which includes 
notice of its intent in the Federal Register, which in turn is 
considered under the law to be adequate notice to all affected parties. 
The Committee believes that its notices contain all the elements which 
the law requires for a notice of proposed rulemaking.
    The second contractor also challenged the adequacy of the 
Committee's determinations on suitability and impact of the addition to 
the Procurement List on the contractor, as the contractor had not 
provided information on these two points. The Committee, following its 
usual practice, based its suitability determination on an inspection of 
the nonprofit agency arranged by DPSC, a separate inspection by the 
central nonprofit agency which represents the nonprofit agency in the 
Committee's program, and the nonprofit agency's long record of 
successful production of a variety of items including a comparable 
litter. The basis for the Committee's determination that addition of 
the litter to the Procurement List will not have a severe adverse 
impact on either contractor was described earlier in this notice. The 
Committee does not believe that additional information from the 
contractor would be likely to alter either determination, and the delay 
necessary for the information to be provided would frustrate the 
purpose of the Committee's program, to create employment for blind 
people, as DPSC needs to procure litters before the information can be 
provided. The Committee's regulations provide for a reconsideration of 
its decision if information can be provided which would significantly 
affect any of the factors on which the decision was made, so the 
contractor will still be able to present any significant information it 
finds.
    The second contractor's claim that addition of the litter to the 
Procurement List will have an adverse effect on national security is 
based on the fact that as a defense contractor the second contractor is 
required to be able to provide additional quantities of the litter in 
the event of a national emergency. The nonprofit agency which will 
produce the litter is also required to possess this capacity, and the 
surveys which were done on it took this factor into account. As the 
contractor will still be able to bid on the non-DPSC part of the 
Government requirement, it is unlikely that it will give up its 
productive capabilities for the litter, and thus lose its capability to 
contribute to the defense industrial base for the item, as it had 
indicated it would do in response to the Committee's original proposal 
to add the entire Government requirement for the litter to the 
Procurement List.
    After consideration of the material presented to it concerning 
capability of qualified nonprofit agencies to provide the commodity, 
fair market price, and impact of the addition on the current or most 
recent contractors, the Committee has determined that the commodity 
listed below is suitable for procurement by the Federal Government 
under 41 U.S.C. 46-48c and 41 CFR 51-2.4. I certify that the following 
action will not have a significant impact on a substantial number of 
small entities. The major factors considered for this certification 
were:
    1. The action will not result in any additional reporting, 
recordkeeping or other compliance requirements for small entities other 
than the small organizations that will furnish the commodity to the 
Government.
    2. The action does not appear to have a severe economic impact on 
current contractors for the commodity.
    3. The action will result in authorizing small entities to furnish 
the commodity to the Government.
    4. There are no known regulatory alternatives which would 
accomplish the objectives of the Javits-Wagner-O'Day Act (41 U.S.C. 46-
48c) in connection with the commodity proposed for addition to the 
Procurement List.
    Accordingly, the following commodity is hereby added to the 
Procurement List:

Litter, Folding
    6530-00-783-7205

(Requirements for the Defense Personnel Support Center only)
    This action does not affect current contracts awarded prior to the 
effective date of this addition or options exercised under those 
contracts.
E.R. Alley, Jr.,
Deputy Executive Director.
[FR Doc. 94-28053 Filed 11-10-94; 8:45 am]
BILLING CODE 6820-33-P