BNUMBER:  B-266144.3
DATE:  February 28, 1996
TITLE:  G.H. Harlow Company, Inc.--Reconsideration

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Matter of:G.H. Harlow Company, Inc.--Reconsideration

File:     B-266144.3

Date:     February 28, 1996

John F. Bradach, Esq., for the protester.
Aldo A. Benejam, Esq., and Christine S. Melody, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

General Accounting Office denies request for reconsideration of 
dismissal of protest challenging the constitutionality of the 
Department of Defense small disadvantaged business set-aside program 
because there is no clear judicial precedent.

DECISION

G.H. Harlow Company, Inc. requests that we reconsider the dismissal of 
its protest challenging the issuance by the United States Property and 
Fiscal Officer for Oregon, National Guard Bureau, of invitation for 
bids (IFB) No. DAHA35-95-B-0008 as a total small disadvantaged 
business (SDB) set-aside.  In its protest, Harlow argued that the 
set-aside was inconsistent with Adarand Constructors, Inc. v. Pena, 
115 S.Ct. 2097 (1995).

We deny the request for reconsideration.

In Adarand, the Supreme Court held that the proper test for 
determining the constitutionality of minority business set-aside 
programs in the federal government is a "strict scrutiny" analysis.  
The Supreme Court did not determine the constitutionality of any 
particular racially based program; rather, the Court simply announced 
the standard that is to be applied in determining the 
constitutionality of such programs.  Since we do not view Adarand as 
providing clear judicial precedent on the constitutionality of 
set-aside programs, we dismissed the protest.  See Elrich Contracting 
Inc.; The George Byron Company, B-262015;B-265701, Aug. 17, 1995, 95-2 
CPD  para.  71.

Harlow maintains that "clear judicial precedent" exists in this area.  
In support of its position, Harlow argues that following the Court's 
decision in Adarand, racially based set-aside programs imposed by the 
federal government are subjected to the same level of "strict 
scrutiny" applied to racially based set-aside programs at the state or 
local level following the Court's decision in City of Richmond v. 
Croson Co., 488 U.S. 469 (1989).  That decision concerned a 
municipality's minority set-aside program.  According to Harlow, the 
"clear judicial precedent" which has developed based on the Croson 
decision should be considered by our Office in determining the 
constitutionality of the federal program at issue here.  We disagree.

Our position is that there must be clear judicial precedent on the 
precise issue presented to us before we will consider a protest based 
on the asserted unconstitutionality of a procuring agency's action.  
Neither the Adarand nor the Croson decision constitutes clear judicial 
precedent on the constitutionality or legality of this SDB set-aside 
program.  These decisions addressed the particular set-aside programs 
that were before the Court, and while they indicate what factors need 
to be considered to determine the constitutionality of a particular 
set-aside program, we are unaware of, and the protester does not cite 
to, any dispositive federal court decisions applying the standards 
articulated in Adarand and Croson to a set-aside program which is 
sufficiently similar to DOD's program so as to warrant regarding those 
decisions as clear judicial precedent here.

In further support of its reconsideration request, Harlow submitted a 
copy of a "MEMORANDUM FOR SECRETARIES OF THE MILITARY DEPARTMENTS," 
dated October 23, 1995, from the Under Secretary of Defense, regarding 
the SDB program.  That document suspends various sections of the 
Department of Defense Federal Acquisition Regulation Supplement 
applicable to SDB set-asides, and directs contracting officers not to 
set aside acquisitions for SDBs until further notice.  According to 
Harlow, the "obvious" thrust of that document is that the Department 
of Defense (DOD) considers the Adarand decision to be clear judicial 
precedent invalidating DOD's SDB set-aside program.

We do not agree with Harlow that the Under Secretary's instructions to 
contracting officials reflect DOD's final position with respect to the 
impact of the Adarand decision on DOD's SDB set-aside program.  
Rather, the memorandum merely suspends the applicable DFARS provisions 
while DOD reviews its current SDB set-aside program.

Finally, contrary to the protester's suggestion, the Under Secretary's 
instructions to contracting officials in his memorandum do not require 
that the instant procurement be canceled and the IFB reissued.  The 
memorandum specifically instructs contracting officials to permit 
acquisitions being conducted as SDB set-asides to proceed undisturbed, 
where amending the solicitation to withdraw the set-aside would unduly 
delay the procurement.[1]

The request for reconsideration is denied.

Comptroller General
of the United States

1. In this case, we have been informed by the Army that the 
contracting activity proceeded to make award under the IFB as 
originally issued.