[Federal Register Volume 62, Number 83 (Wednesday, April 30, 1997)]
[Pages 23430-23432]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-11135]



Procurement List Addition

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

ACTION: Addition to the Procurement List.


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

EFFECTIVE DATE: May 30, 1997.

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 March 7, 1997, the Committee for 
Purchase From People Who Are Blind or Severely Disabled published 
notice (62 F.R. 10519) of proposed addition to the Procurement 
List. Comments were received from two Government agencies, three 
minority business associations, one small business owner, a labor 
union, two political organizations, 133 employees of the Government 
facility where the service will be performed, two contractors at 
that facility, an employee of the current janitorial contractor, 
and one other individual. All commenters opposed the addition of 
this service to the Procurement List.

    This service is currently being performed by a small disadvantaged 
business which is graduating from the Small Business Administration's 
8(a) Program. The two commenting Government agencies claimed that 
removal of the service from the 8(a) Program would cause severe adverse 
impact on the Program's ability to provide business development 
opportunities for small disadvantaged businesses, both nationally and 
at the Government agency where the service is being performed. Another 
commenter claimed that the 8(a) Program cannot

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meet its goals if the Committee's Javits-Wagner-O'Day (JWOD) Program 
continues to remove services from the 8(a) Program, and that the 
Committee's practice of adding these services when a specific 8(a) 
contractor graduates from the 8(a) Program ignores the legislative 
intent of the Small Business Act and the responsibility of Government 
agencies to support the 8(a) Program. Other commenters declared that 
Congress did not intend for the JWOD and 8(a) Programs to compete, and 
that 8(a) contracts should remain in that Program.
    The 8(a) Program's share of Government contracting dollars is 
approximately ten times the size of the JWOD Program's share. 
Consequently, the Committee does not believe that adding this service 
to the Procurement List, will have a severe adverse impact on the 8(a) 
Program, even if the limited number of other 8(a) services which have 
been added to the Procurement List are taken into account. Similarly, 
the Government agency where the service is being performed has an 
extremely successful 8(a) Program of which the contract for this 
service represents a minute portion. As a result, the Committee does 
not believe that adding this service to the JWOD Program will have a 
substantial negative impact on the agency's overall 8(a) Program.
    The Committee's priority over small business setaside programs has 
long been established, and the Committee believes its policy of only 
adding 8(a) services to the Procurement List when a contractor 
graduates from the 8(a) Program shows that the Committee attempts to 
minimize its impact on small disadvantaged businesses who have 
performed the services and still remain in the 8(a) Program. Because 
JWOD nonprofit agencies are normally in the same size range as small 
disadvantaged businesses and can perform the same types of work, it is 
inevitable that there will be some overlap between them. The Committee 
does not know of any legislative intent that they not compete or that 
the JWOD Program be limited in carrying out its statutory mission to 
services which have not previously been performed by 8(a) contractors.
    One commenter, a trade association representing 8(a) companies, 
stated that all Government contracts should be available to competition 
and that the JWOD Act should be amended to limit Government awards to 
JWOD nonprofit agencies to amounts below a specific dollar ceiling.
    These proposals, which would necessitate changes to the 8(a) 
Program as well, would require legislative action and are thus outside 
the scope of the Committee's decision on this addition to the 
Procurement List.
    The same commenter suggested that 8(a) contractors should be 
permitted to subcontract with JWOD nonprofit agencies so that both 8(a) 
and JWOD entities would benefit from the same Government contracts. The 
Committee explored this approach with representatives of the Government 
contracting activity, which raised the issue too late for the proposal 
to be given the thorough consideration the Committee deemed necessary. 
The Committee does intend to consider in the coming months whether the 
proposed approach warrants in-depth examination for possible future 
    Many commenters noted that a large number of janitorial employees 
at the Government facility would be displaced by the Committee's 
action, despite, in some cases, long years of excellent service. One 
commenter claimed that if any current employees were hired by the JWOD 
nonprofit agency, they would take a substantial pay cut. Two commenters 
asked whether the Committee would provide for the displaced workers. 
Another commenter suggested that people with disabilities be hired by 
the current 8(a) contractor as vacancies occur rather than displacing 
the current workers.
    The Committee is sensitive to the issue of displacing longstanding 
workers at janitorial projects, and permits nonprofit agencies 
performing JWOD contracts to accommodate such workers on a transitional 
basis as much as possible consistent with its statutory requirement 
that the majority of workers on JWOD contracts be people with severe 
disabilities. JWOD nonprofit agencies, like all Government service 
contractors, are required to maintain the union wage for the first year 
after they succeed a union contractor, as they are doing in this case. 
If the new workforce does not elect to be unionized, after the first 
year, the JWOD nonprofit agency must pay a Department of Labor-
determined wage rate, which normally tracks prevailing union wages. In 
this case, the new rate, while lower than the current union rate, 
significantly exceeds the minimum wage.
    Since the current contractor is graduating from the 8(a) Program 
and is not eligible to perform the contract in the future, the 
suggestion that it continue employing the existing workforce and hire 
people with severe disabilities as vacancies occur is not possible. In 
addition, people with severe disabilities have an unemployment rate 
exceeding 65 percent, well above any other group. Accordingly, the 
Committee believes that the guarantee of jobs for a large number of 
people with severe disabilities outweighs the possible harm to the 
displaced workers, who will be more likely to find other employment. In 
addition, NISH has agreed to try and help interested displaced workers 
find janitorial jobs by referring them to other nonprofit agencies in 
the area that participate in the JWOD Program.
    Many commenters urged that the displaced workers be relocated to 
other jobs at the same Government facility or other Government 
facilities. This approach, while laudatory, is outside the Committee's 
    The union representing the current workers, and other commenters, 
urged the Committee to work with the union to avoid pitting union and 
disabled workers against each other. Other commenters expressed fears 
that the Committee's action will break the union, and stated that it 
would be better to keep the contract unionized to maintain current wage 
levels. Many commenters claimed that the JWOD nonprofit agency's 
workers would be taken advantage of in the areas of wages and benefits 
because they will not be union members.
    The Committee has no objection to nonprofit agencies with JWOD 
contracts being unionized, and some of them are union shops when the 
workers have elected to be represented by unions. As indicated in a 
previous paragraph, wages and benefit levels under the JWOD contract 
will--if the workforce is not unionized after the first year--be lower 
than those that have existed in the union shop, but consistent with 
prevailing wages for comparable jobs in the area.
    Two commenters claimed that the quality of service will decrease 
once the JWOD nonprofit agency becomes the contractor. Another 
commenter claimed that people with severe disabilities will injure 
themselves or harm critical flight hardware at the facility as they 
clean. The nonprofit agency is already successfully performing 
janitorial work at several other Government agencies, and the 
contracting activity has advised the Committee that it believes the 
nonprofit agency is capable of performing the work involved. As a 
consequence, the Committee has no reason to doubt that the nonprofit 
agency will be able to perform the services in question successfully 
and without injury to personnel or equipment.
    After consideration of the material presented to it concerning 
capability of qualified nonprofit agencies to provide

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the service and impact of the addition on the current or most recent 
contractors, the Committee has determined that the service 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 service to the 
    2. The action will not have a severe economic impact on current 
contractors for the service.
    3. The action will result in authorizing small entities to furnish 
the service 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 service proposed for addition to the 
Procurement List.
    Accordingly, the following service is hereby added to the 
Procurement List:

Janitorial/Custodial, NASA Goddard Space Flight Center, Greenbelt, 

    This action does not affect current contracts awarded prior to the 
effective date of this addition or options that may be exercised under 
those contracts.
Beverly L. Milkman,
Executive Director.
[FR Doc. 97-11135 Filed 4-29-97; 8:45 am]