BNUMBER:  B-277241.15 
DATE:  March 11, 1998
TITLE: Aalco Forwarding, Inc., et al., B-277241.15, March 11, 1998
**********************************************************************

Matter of:Aalco Forwarding, Inc., et al.

File:     B-277241.15

Date:March 11, 1998

Alan F. Wohlstetter, Esq., and Stanley I. Goldman, Esq., Denning & 
Wohlstetter; James M. McHale, Esq., Seyfarth, Shaw, Fairweather & 
Geraldson; Thomas M. Auchincloss, Jr., Esq., Leo C. Franey, Esq., and 
Brian L. Troiano, Esq.,
Rea, Cross & Auchincloss, for the protesters.
Thomas J. Duffy, Esq., Maj. Jonathan C. Guden, and Ramon Morales, 
Esq., Department of the Army, for the agency.
Adam Vodraska, Esq., and James A. Spangenberg, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1. Under a solicitation contemplating the award of multiple indefinite 
delivery, indefinite quantity contracts to implement a pilot program 
for moving and storage services, protests that the contract minimum of 
$25,000 per contractor is only nominal consideration insufficient to 
bind the parties are denied, where the nature of the acquisition 
dictates the possibility that the government may order only this 
quantity and the establishment of long-term commitments with 
relatively few prime contractors, who will potentially be provided 
greater shipping volumes than under the current program, shows an 
intent to form binding contracts.  

2.  Under a solicitation contemplating the award of multiple 
indefinite delivery, indefinite quantity contracts to implement a 
pilot program for moving and storage services, protests that the 
maximum quantities for the various traffic channels are unrealistic 
are denied, where it cannot be determined that the maximums were not 
established in good faith or based on the best information available, 
or that they do not accurately represent the agency's anticipated 
needs, given the contracting agency's reasonable explanation that the 
varying nature and unpredictability of its requirements necessitate 
the stated maximums.

3.  On a solicitation for an indefinite quantity of moving and storage 
services, a price evaluation scheme that evaluates offerors' prices by 
applying them in a notional shipment, including all possible 
accessorial services that may be ordered under the contract, is not 
objectionable, even though the notional shipment is not representative 
of a typical shipment that may be ordered under the contract, where 
the notional shipment provides a common basis for price evaluation 
under the solicitation, the agency requires a evaluation model that 
encompasses all accessorial services that may be ordered under the 
pilot program, the agency has no basis on which to provide estimates 
for the accessorial services given the lack of historical information, 
and the protesters have not established that the notional shipment 
will produce a materially misleading result.

4.  Protests that Service Contract Act should not apply to a 
solicitation for moving and storage services are denied where the 
Department of Labor, which is statutorily charged with implementation 
of the Act, has determined that the Act applies and that determination 
is not clearly contrary to law.

5.  Protests that Service Contract Act wage determinations issued with 
a solicitation for moving and storage services do not cover all 
localities where the services will be performed and all classes of 
service employees that may be utilized are denied, where the 
Department of Labor's determination that wage rates need only be 
established for the states from which shipments originate is not so 
unreasonable as to be contrary to law and where the protesters can 
avail themselves of established procedures for adding classes of 
employees to the wage determinations.

DECISION

Aalco Forwarding, Inc. and 121 other firms protest the terms of 
request for proposals (RFP) No. DAMT01-97-R-3001, issued by the 
Military Traffic Management Command (MTMC), Department of the Army, 
for all personnel, equipment, materials, supervision, and other items 
necessary to provide transportation and transportation-related 
services for 50 percent of the eligible Department of Defense (DOD) 
and U.S. Coast Guard sponsored personal property shipments from North 
Carolina, South Carolina, and Florida, to any or all of 13 destination 
regions in the continental United States (CONUS) and/or any or all of 
5 destination regions in Europe.[1]  The solicitation implements a 
pilot program to reengineer DOD's personal property shipping and 
storage program.  In these protests, the protesters primarily contend 
that the RFP does not properly specify contract minimum and maximum 
quantities of services to be ordered, that the RFP's price evaluation 
scheme is defective, and that the Service Contract Act of 1965 (SCA), 
41 U.S.C.  sec.  351-358 (1994), was improperly applied to this RFP.[2]

The protests are denied.

BACKGROUND

This procurement was the subject of prior decisions in Aalco 
Forwarding, Inc.,
et al., B-277241.8, B-277241.9, Oct. 21, 1997, 97-2 CPD  para.  110, which 
denied various protests primarily against the acquisition of these 
services under the Federal Acquisition Regulation (FAR) part 12 
commercial item procedures, and in Aalco Forwarding, Inc.,et al., 
B-277241.12, B-277241.13, Dec. 29, 1997, 97-2 CPD
 para.  175, which denied protests that the RFP unnecessarily bundled 
certain contract requirements to the detriment of small business 
concerns.

As previously noted, the RFP was issued pursuant to the commercial 
item procedures of FAR part 12, and implements a pilot program for 50 
percent of the eligible outgoing personal property shipments from the 
three origin states in the test area.[3]  The RFP contemplates the 
award of firm, fixed-price, indefinite delivery/indefinite quantity 
(IDIQ) contracts for a period of performance of a base year with 2 
option years.  RFP at 2. 

The RFP provides that the government will award contracts to the 
responsible offerors whose offers represent the best overall value, 
and allows the government to award a single task order contract or to 
award multiple task order contracts for the same or similar services 
to two or more sources; MTMC anticipates making multiple awards.  RFP 
at 37-38.  The non-price evaluation factors listed in descending order 
of importance are past performance/experience and subcontracting plan 
(which is not applicable to small business offerors); these factors, 
when combined, are significantly more important than price.  RFP at 
38.  The RFP provides for separate methodologies for evaluating price 
reasonableness for domestic channels and for international channels.  
To evaluate price reasonableness for international channels, a 
"notional shipment" encompassing all the possible services will be 
used.  RFP at 39.  
  
For all domestic shipments, pricing is requested from origin to 
destination for the base year and each option year for a basic 
transportation contract line item number (CLIN) and a 
storage-in-transit (SIT) and SIT-related services CLIN.  RFP section 
B.  The pricing is to be based upon the Professional Movers Nationwide 
Household Goods Commercial Relocation Tariff, STB HGB 400-L in effect 
as of May 5, 1996, and the MTMC Domestic Personal Property Rate 
Solicitation Exception Appendix to the tariff dated January 16, 
1997.[4]  RFP attachment 7.  For international shipments (including 
household goods and unaccompanied baggage), single factor rates per 
net hundredweight are solicited for transportation from origin to 
destination for the base year and each option year for surface 
shipments and for air shipments; unit prices are also requested for 
various specified accessorial services CLINs, such as special crating, 
stopoffs, extra labor, vehicle waiting time, reweigh, and SIT, which 
are not included in the transportation single factor rates.  RFP 
section B and attachment 7.

The RFP requires offerors to list in their proposals the daily 
capacity (in pounds) that they are committing to this contract for the 
base year and each option year per traffic lane (shipments from an 
origin shipping office to a destination region) for each traffic 
channel (shipments from an origin state to a destination region) for 
which offers are submitted.[5]  RFP attachment 3 and Performance Work 
Statement (PWS) at 19.  Each offeror's committed daily capacity will 
be used by the agency in determining the number of contracts to be 
awarded for each traffic channel, RFP at 37, and to obligate the 
contractors to provide requested services up to their committed daily 
capacities, PWS at 19.  Although a minimum committed daily capacity is 
not specified, the RFP states that committed daily capacities must be 
reasonable, based on the historical tonnage projections.  Id.  The 
RFP, as amended, also provides historical monthly/yearly tonnage data 
and numbers of shipments for each traffic lane for fiscal years 1994, 
1995, and 1996.  RFP attachment 4.

As amended, the RFP recognizes that the SCA is applicable to this 
procurement by incorporating the standard clause, FAR  sec.  52.222-41, and 
including wage determinations specifying the minimum wages to be paid 
for certain covered labor categories.[6]  RFP at 31 and attachment 8.

Once the contracts are awarded, personal property shipments will be 
ordered by the government through task orders; the orders will be 
placed on a rotational basis until the contract minimum ($25,000) for 
each awardee is reached, and then issued based upon the contractor's 
proven value to the government.  RFP at 29 and PWS
at 19.  

ANALYSIS

Contract Minimums and Maximums

The protesters argue that the RFP is defective because it contains a 
minimum dollar amount of orders that is only nominal as to each 
contractor and because the stated maximum quantities are not 
realistic.

An IDIQ contract may be used when the government cannot predetermine, 
above a specified minimum, the precise quantities of supplies or 
services that will be required during the contract period, and where 
it is inadvisable for the government to commit itself for more than a 
minimum quantity.  FAR  sec.  16.504(b).  An IDIQ contract shall require 
the government to order and the contractor to furnish at least a 
stated minimum quantity of supplies or services and, if and as 
ordered, the contractor to furnish any additional quantities, not to 
exceed a stated maximum.  FAR  sec.  16.504(a)(1).  To ensure the contract 
is binding, the minimum quantity must be more than a nominal quantity 
but should not exceed the amount the government is fairly certain to 
order.  FAR  sec.  16.504(a)(2).  Estimated maximum quantities should be 
realistic and based on the most current information available.  FAR  sec.  
16.504(a)(1).  These estimates need not be precise; rather, such 
estimates are unobjectionable so long as they were established in good 
faith or based on the best information available, and accurately 
represent the agency's anticipated needs. Sea-Land Serv., Inc., 
B-278404.2, Feb. 9, 1998, 98-1 CPD  para.      at 11.

The RFP sets forth contract minimums of $25,000 per contract awarded 
for the base
period and each exercised option period.[7]  RFP at 2.  The $25,000 
contract minimum amount remains the same independent of the number of 
channels awarded per contract.  Id.  According to the contracting 
officer, the $25,000 minimum quantity "is based upon approximately up 
to about seven shipments per contract award."[8]  The protesters 
contend that a contract minimum of $25,000 for each contractor is only 
nominal and provides inadequate consideration to make the contracts 
binding.  

An IDIQ contract is binding so long as the buyer agrees to purchase 
from the seller at least a guaranteed minimum quantity of goods and 
services; the stated minimum quantity forms the consideration for the 
contract.  See Sunbelt Properties, Inc., B-249307, Oct. 30, 1992, 92-2 
CPD  para.  309 at 3; see Willard, Sutherland & Co. v. U.S., 262 U.S. 489, 
493 (1923).  Since the prohibition in FAR  sec.  16.504(a)(2) against a 
"nominal" minimum quantity is designed to ensure that the intent to 
form a binding contract is present, the determination whether a stated 
minimum quantity is "nominal" must consider the nature of the 
acquisition as a whole.  Sea-Land Serv., Inc., supra, at 12.

The solicitation here allows for multiple awards to transport personal 
property shipments on the same channels and provides for a best value 
basis for selecting among the contractors once the $25,000 minimums 
are satisfied.  Thus, for each channel, MTMC may have multiple choices 
of contractors in shipping a service member's or civilian employee's 
household effects.  Since it is not possible to know, after the 
minimums are satisfied, whether a given contractor will be used under 
the best value ordering scheme until individual orders arise, it is 
uncertain whether an individual contractor will carry more shipments 
than $25,000 worth per year during the life of the contract.  
Moreover, an offeror may be awarded only one of the low volume 
channels with a handful of shipments per year.  As the minimum 
quantity on any one contract may not exceed the amount the government 
is fairly certain to order, FAR  sec.  16.504(a)(2), we think the $25,000 
contract minimum is an amount that would not mislead contractors or 
subject the government to undue risk under the best value award scheme 
for the task orders.  

While the contract minimum of $25,000 may be relatively low for higher 
volume channels or where a contractor receives award and commits 
capacity for multiple channels with significant volumes, the 
establishment of long-term commitments with relatively few prime 
contractors, who will potentially be provided greater shipping volumes 
than under the current program in order to achieve the needed 
economies of scale, underscores the government's intent to form 
binding contracts.  The fact that the RFP does not provide a minimum 
quantity proportionate to contractor's committed daily capacity for 
each awarded channel or is not otherwise linked to the estimated 
traffic volume for each channel does not detract from the 
enforceability of the contracts to be awarded, given the uncertainty 
associated with the number of orders to be placed with each 
contractor.[9]  See Sunbelt Properties, Inc., supra.  Considering all 
of the circumstances, we cannot conclude that the stated minimum 
quantity per contractor here represents insufficient consideration to 
form a binding contract.  Id.; Sea-Land Serv., Inc., supra, at 12.

With respect to the maximum quantities, MTMC has reiterated in its 
response to the protest that the maximum dollar amount for the entire 
pilot test program is $75 million for the base period and for each 
exercised option period.  RFP at 2.  Attachment 6 to the RFP specifies 
the maximum dollar amount per channel (origin state to destination 
region) based on historical data.  In this regard, the solicitation 
complies with FAR  sec.  16.504(a)(4)(ii) by specifying the total maximum 
dollar value of services to be acquired under each contract as the 
channel maximums.  A contractor receiving a contract award of one 
channel will be awarded the channel maximum amount for the contract 
maximum and all contractors receiving a contract award for the same 
channel will receive the same channel maximum.  RFP at 2.  If a 
contractor is awarded a contract containing numerous channels, the 
channel maximums will be added to make an aggregate total contract 
maximum.[10]  Id.

The agency explains that the contract maximums are simply ordering 
limitations per
channel, not estimates of the amount of dollars successful offerors 
will be awarded under the resulting contracts.  According to MTMC, the 
varying nature and unpredictability of the government's requirements 
necessitate the use of the stated maximum quantities, which were 
derived by multiplying the average cost per shipment by the estimated 
average annual number of shipments for the pilot program based on 
historical data from fiscal years 1994 and 1995.  The resulting amount 
was increased by a factor of 50 percent to meet unforeseen 
contingencies and to ensure the maximum was high enough to cover 
potential increases in requirements.[11]  This $75 million contract 
maximum was then apportioned to each channel based upon the ratio of 
the tonnage in a channel to the total tonnage for the pilot program 
based on the historical data. 

Some of the protesters contend that the maximums are overstated based 
on more recent historical shipment data for fiscal year 1996.  Other 
protesters apparently argue that the maximums may be understated, 
given the requirements of this RFP that are intended to provide for 
higher quality service and additional services, and the cost 
experience under a pilot program for similar services at Hunter Army 
Airfield.  However, none of the protesters have shown that the 
maximums for these channels are unrealistic in reflecting MTMC's 
anticipated needs considering the varying historical data in its 
totality, i.e., fiscal years 1994, 1995, and 1996, and the possibility 
of large troop deployments from the origin states.[12]  In this 
regard, an agency can factor in amounts for anticipated surges in the 
requirements in establishing maximums.  Sea-Land Serv., Inc., supra, 
at 13.  

Moreover, we note that offerors will not have to unnecessarily commit 
resources to service a misleadingly large order limitation because 
they are not obligated to accept any shipments beyond their committed 
daily capacities, which are based on the resources they wish to commit 
to the contract and will be evaluated by the agency based on the 
historical tonnage data furnished with the RFP.  While the protesters 
may disagree with the methodology employed by the agency in 
establishing the maximums, we have no basis to conclude that the 
contract maximum amounts here were not established in good faith or 
based on the best information available, or that they do not 
accurately represent the agency's anticipated needs, given the varying 
nature and unpredictability of the government's requirements under the 
pilot program, as evidenced by the historical data supplied with the 
RFP itself.  Id.  

Price Evaluation for International Channels

Some of the protesters contend that the RFP's price evaluation for the 
international channels is an unreasonable hypothetical basis for price 
evaluation.  The solicitation's price evaluation scheme provides as 
follows:

     (2) International channels.

     A notional international shipment will be used to perform price 
     analysis for international CLINs.  The notional shipment will 
     consist of a 4000 pound surface shipment and a 500 pound air 
     shipment.  Each shipment will have a 10 cubic feet special 
     crating requirement, one domestic and international stopoff, [4] 
     hours of domestic and international regular labor, [4] hours of 
     domestic and international overtime labor, [4] hours of domestic 
     and international vehicle waiting time, one reweigh, 90 days 
     domestic and international SIT, and one excessive distance carry 
     charge based on 200 pounds for domestic and international 
     mini-storage.  MTMC will select one of the three CLINs for pickup 
     and delivery out of SIT transportation charge for the price 
     evaluation. . . .  A factor of 65 [percent] will be applied to 
     the surface shipment and a factor of 35 [percent] will be applied 
     to the air shipment.  The resulting prices will be added together 
     to determine a cumulative total price, by channel.  These prices 
     for the base period and the two option periods will be reviewed 
     separately and together for price reasonableness.

RFP at 39.  The contracting officer states that the notional shipment 
is necessary because MTMC does not have historical data regarding 
accessorial services for international shipments, such as special 
crating, stopoffs, extra labor, vehicle waiting time, and reweighs, 
and consequently could not provide a proposed estimated quantity for 
each accessorial service in the price schedule for such shipments.[13]  
The contracting officer explains that a notional shipment that 
includes all possible accessorial services provides a common baseline 
for evaluation for all offers submitted for these channels, and that 
without the notional shipment the agency would not be able to 
determine which offeror submitted the lowest price.  

The protesters argue that the notional shipment is an unreasonable 
basis for price evaluation of the proposed CLIN pricing, in lieu of 
specifying estimated quantities, because the notional shipment 
includes accessorial services for the 500-pound air shipment (which 
they claim would typically be an unaccompanied baggage shipment) that 
are rarely, if ever, performed, and because the notional shipment does 
not allow for consideration of the variances in the need for 
particular accessorial services on each shipment.  The protesters also 
argue that the 65/35 percent weighting factor to be applied to the 
notional surface and air shipments dramatically varies from relative 
total revenues of surface and air shipments in the current program.

Agencies must consider cost to the government in evaluating 
competitive proposals.  10 U.S.C.  sec.  2305(a)(3)(A)(ii) (1994); Health 
Servs. Int'l, Inc.; Apex Envtl., Inc., B-247433, B-247433.2, June 5, 
1992, 92-1 CPD  para.  493 at 3-4.  While it is up to the agency to decide 
upon some appropriate, reasonable method for proposal evaluation, an 
agency may not use an evaluation method that produces a misleading 
result.  Id. at 4.  Such method must include some reasonable basis for 
evaluating or comparing the relative costs of proposals, so as to 
establish whether one offeror's proposal would be more or less costly 
than another's.  See Health Servs. Int'l, Inc.; Apex Envtl., Inc., 
supra; Penn, Ferrara, Adler & Eichel, 66 Comp. Gen. 242, 245 (1987), 
87-1 CPD  para.  134 at 3-4.  Where estimates for various types of required 
services are not reasonably available, an agency may establish a 
reasonable hypothetical, consistent with the RFP requirements, to 
provide a common basis for comparing the relative costs of the 
proposals.  See High-Point Schaer, 70 Comp. Gen. 524, 528-30 (1991), 
91-1 CPD  para.  509 at 6-8.

As noted, the agency lacks historical data to project estimates for 
the accessorial CLINs for the international shipments, but needs a 
price evaluation scheme that accounts for the prospective ordering of 
all possible accessorial services and that provides a common basis for 
proposal comparison and determining the relative cost to the 
government.  The protesters know from their participation and 
experience in the current program that each international shipment 
will necessarily be different due to the many variables inherent in 
each move.[14]  It thus appears that no single realistic shipment 
would be sufficiently representative to present a reasonable basis for 
cost comparison, particularly given the agency's desire to evaluate 
all possible accessorial services.[15]  We note that the protesters 
have suggested no viable alternative to the agency's approach.  Under 
the circumstances, we find no basis to object to the use of the 
notional shipment, including all possible services, to evaluate the 
relative costs of the proposals, even though the notional air and 
surface shipments may not be exactly replicated in reality.  See id.

The protesters' specific objections to the notional shipment 
evaluation scheme also provide no basis for us to object to the RFP.  
The protesters assert that certain of the accessorial services 
specified in the notional air shipment are rarely, if ever, performed 
on unaccompanied baggage shipments.  According to the contracting 
officer, while this is likely, it will not always be the case under 
this RFP because the accessorial services listed in the price schedule 
and evaluated in the notional shipment are applicable for all 
shipments.  In this regard, the RFP requires contractors to service 
both household goods and unaccompanied baggage shipments, PWS at 3, 
and seeks prices (single factor rates) per hundredweight for surface 
or air transportation subject to a 500-pound minimum, with no 
distinction being made between household goods and unaccompanied 
baggage.  RFP section B and attachment 7.  In other words, not all air 
shipments are unaccompanied baggage shipments, and the premise of the 
protester's argument is not consistent with the RFP.  Further, the 
accessorial services, which are separately priced in the solicitation, 
and used for the notional shipments, apply to both household goods and 
unaccompanied baggage shipments.  RFP attachment 7.  Given the 
agency's requirement to evaluate all possible accessorial services, 
the failure of the protesters to show how this methodology will 
necessarily produce a materially misleading result, and the fact that 
all proposals will be evaluated on a common basis, the protesters' 
assertions regarding the relative rarity of certain accessorial 
services on unaccompanied baggage shipments provide no basis to object 
to the RFP's notional shipment evaluation scheme.  See High-Point 
Schaer, supra.

The protesters also argue that the particular notional shipment 
formula substantially misstates the cost to the government by failing 
to reflect that, historically, the percentages of total revenue 
generated from surface shipments is greater than the 65 percent factor 
to be applied to the notional 4000-pound surface shipment and the 
percentage of total revenue generated from air shipments is less than 
the 35-percent factor to be applied to the notional 500-pound air 
shipment.  However, the factors to be applied to the notional shipment 
reasonably reflect what the agency anticipates will be the allocation 
of surface and air shipments during the pilot program, rather than a 
replication of the total costs to the government of these two types of 
shipments under the current program.  Given the substantial 
differences in the requirements of the current program compared to the 
pilot program, the current program's allocation of revenues to surface 
and air shipments may well be inapposite to the relative weights 
assigned to the surface and air shipments factors in the notional 
shipment price evaluation scheme for the pilot program.  Since, 
according to the agency, the number of shipments is a more dependable 
factor than revenue or tonnage, and since orders will actually be 
placed on a per shipment basis, the number of shipments seems an 
appropriate basis on which to weight the relative proportions of 
surface and air shipments in the notional shipment price evaluation 
scheme.

Service Contract Act

As currently amended, the RFP implements the SCA and contains wage 
determinations issued by the Department of Labor (DOL) for the origin 
states of North Carolina, South Carolina, and Florida, establishing 
the minimum wages and fringe benefits to be paid to the following 
occupations identified by MTMC as classes of service employees 
expected to be employed under the contracts: warehouseman, material 
handling laborer, forklift operator, shipping packer, and several 
classes of truck driver.  

The SCA requires federal contractors to pay minimum wages and fringe 
benefits as determined by the Secretary of Labor to employees under 
service contracts exceeding $2,500.  When the Act applies to a 
particular contract, that contract must contain certain provisions 
specifying the level of wages to be paid, 41 U.S.C.  sec.  351(a)(1), and 
the minimum level of fringe benefits to be provided, 41 U.S.C.  sec.  
351(a)(2).

Some of the protesters contest the applicability of the SCA to this 
procurement.[16]  The basis of the protesters' contention that the SCA 
is inapplicable is the statutory exemption for "any contract for the 
carriage of freight or personnel by vessel, airplane, bus, truck, 
express, railway line or oil or gas pipeline where published tariff 
rates are in effect."  41 U.S.C.  sec.  356(3).  According to the 
protesters, the domestic portion of the pilot program will involve the 
carriage of freight (household goods in this case) by truck by common 
carriers, and since the contracts to be awarded will be subject to 
effective published tariffs which will govern the carriage of the 
personal property shipments, the statutory exemption to the SCA 
applies to the domestic motor carrier service to be provided under the 
pilot program.

DOL, not our Office, has the primary responsibility for interpreting 
and administering the SCA, and a contracting agency may follow the 
DOL's views on the applicability of the SCA unless they are clearly 
contrary to law.   Delta Oaktree Productions, B-248903, Oct. 7, 1992, 
92-2 CPD  para.  230 at 2; Associated Naval Architects, Inc., B-221203, Dec. 
12, 1985, 85-2 CPD  para.  652 at 1-2.  DOL is accorded deference in the 
interpretation both of the SCA as a statute that has been committed to 
DOL for implementation and enforcement and of the regulations it has 
issued in implementing the SCA.  Relief Servs., Inc.; Radiological 
Physics Assocs., Inc., B-252835.3, B-252835.4, Aug. 24, 1993, 93-2 CPD  para.  
116 at 4 n.1.

DOL has determined that the SCA applies to this RFP, as evidenced by 
its issuance of the wage determinations included in the RFP, the notes 
of the meeting between DOL and the Army regarding the applicability of 
the SCA, and DOL's concurrence with the Army's position in response to 
the protests that the above-cited statutory exemption to the SCA is 
inapplicable on the grounds that published tariff rates do not govern 
the contracts to be let under the solicitation for the pilot program.  
The applicable DOL regulation interpreting the exemption, 29 C.F.R.  sec.  
4.118 (1997), states in pertinent part that: 

     a contract for transportation service does not come within [the 
     statutory] exemption unless the service contracted for is 
     actually governed by published tariff rates in effect pursuant to 
     State or Federal law for such carriage.  The contracts excluded 
     from the reach of the [SCA] by this exemption are typically those 
     where there is on file with the Interstate Commerce Commission 
     [ICC] or an appropriate State or local regulatory body a tariff 
     rate applicable to the transportation involved and the 
     transportation contract between the Government and the carrier is 
     evidenced by a Government bill of lading citing the published 
     tariff rate.[17]

While the solicitation requests that prices for the domestic portion 
of the pilot program be quoted as a percentage of a specified 
commercial tariff, the tariff does not itself govern the rates to be 
charged the government, but merely serves as a baseline for pricing of 
the contracts to be awarded, and the rates submitted by offerors can 
be higher or lower than the specified tariff.  In this regard, the 
version of the commercial tariff referenced in the solicitation is not 
the current version used for commercial purposes and the rates are, in 
effect, frozen for the duration of the contracts, notwithstanding any 
later versions of the tariff applicable to other shippers.  Although, 
as the protesters note, individual carrier tenders under the current 
system may also be stated as a percentage of a tariff, the current 
system is exempt from application of the SCA under a separate 
administrative exemption,
4 C.F.R.  sec.  4.123(d)(3), and the reduced rates of the current system 
are specifically authorized by statute, 49 U.S.C.  sec.  13712 (Supp. I 
1996) (formerly 49 U.S.C.  sec.  10721(b)(1) (1994)).[18]

Thus, we cannot find DOL's position that the statutory exception to 
the SCA applies only when tariff rates are applicable without 
exception to be clearly contrary to law, and will not further consider 
the matter.  If the protesters wish to challenge the applicability of 
the SCA to the present solicitation, their proper course of action is 
to bring the matter before the DOL's Wage and Hour Division 
Administrator for an official ruling.  29 C.F.R.  sec.  4.101(g); Ober 
United Travel Agency, Inc., B-252363, May 7, 1993, 93-1 CPD  para.  375 at 
3.

The protesters next contend that if the SCA does apply to this 
procurement, the statewide wage determinations issued for the three 
origin states do not encompass the localities in the CONUS destination 
regions where delivery services (such as unloading and unpacking) will 
be performed, and thus the wage determinations included with the RFP 
are incomplete.

Since the primary responsibility for interpreting and administering 
the SCA is vested in DOL, that agency's determination as to the manner 
in which the SCA will be applied is not objectionable unless so 
unreasonable as to be clearly contrary to law.  Midwest Serv. and 
Supply Co. and Midwest Engine Inc., B-191554, July 13, 1978, 78-2 CPD  para.  
34 at 5.

Here, the record shows that the "locality" on which to base the wage 
determinations was the subject of discussions between the Army and 
DOL.  The Army informed DOL that the contracts would be awarded on a 
channel basis from each origin state to destination region, explaining 
that a contractor would have to pick up shipments from any point 
within the origin states, possibly pick up additional shipments en 
route, possibly make partial deliveries en route, and provide delivery 
at destination, thus presenting the potential for a "bewildering" 
number of prevailing wage rate determinations for numerous areas of 
performance.  In response, DOL recommended the use of statewide wage 
determinations for the origin states, which would apply to the 
services to be provided for any movements originating in each state 
regardless of where the services are in fact provided.  MTMC was 
informed by DOL officials that contracts let by the United States 
Postal Service for the transportation of mail from and to multiple 
mail distribution centers follow a similar procedure, which avoids the 
assertedly incongruous result of requiring a different wage rate each 
time a carrier's covered employees cross into different localities.  
Based on DOL's advice, the contracting officer requested and obtained 
prevailing wage rate determinations for the three origin states.  We 
cannot conclude here that the use of statewide wage rate 
determinations from the origin states for traffic channels emanating 
from those states is so unreasonable as to be clearly contrary to law, 
given the "elastic and variable meaning" of the term "locality" as 
used by DOL, 29 C.F.R.  sec.  4.54(a), and DOL's responsibility for 
interpreting and administering the SCA.  See Midwest Serv. and Supply 
Co. and Midwest Engine Inc., supra, at 5-7; The Cage Co. of Abilene, 
Inc., 57 Comp. Gen. 549, 553-554 (1978), 78-1 CPD  para.  430 at 7-9.

The protesters finally contend that wage determinations have not been 
obtained for each class of service employee who will be performing the 
services under the contracts, such as for transportation arrangers 
(including freight forwarders), the contract and operations managers 
required by the RFP, and the other workers who will perform such 
required services as movement counseling; claims processing; quality 
control monitoring; answering telephone inquiries; and secretarial, 
clerical, and data processing activities.

MTMC explains that the categories of workers included in the wage 
determinations were derived based on its experience with other 
FAR-based procurements for moving and storage services as well as on 
DOL suggestions in this regard.  As noted by MTMC, offerors may 
utilize different types of employees to accomplish the contract 
requirements, and there are established procedures for adding other 
occupations to a wage determination known as the "conformance 
process," which is detailed in the wage determinations attached to the 
RFP and in FAR clause
 sec.  52.222-41(c)(2) incorporated in the RFP.[19]  See FAR  sec.  22.1019.  
Since these procedures and the DOL regulations, 29 C.F.R. 4.6(b)(2), 
provide an orderly method by which such omitted employees can be 
appropriately classified and afforded SCA protection, we do not 
conclude that the solicitation is defective in this respect.  See 
Midwest Serv. and Supply Co. and Midwest Engine Inc., supra, at 8.

The protests are denied.

Comptroller General
of the United States

1. The firms protesting this solicitation are:  Aalco Forwarding, 
Inc.; AAAA Forwarding, Inc.; Air Van Lines International, Inc.; 
Allstates Worldwide Movers; Aloha Worldwide Forwarders, Inc.; Alumni 
International, Inc.; American Heritage International Forwarding, Inc.; 
American Mopac International, Inc.; American Shipping, Inc.; American 
Vanpac Carriers; American World Forwarders, Inc.; Apollo Forwarders, 
Inc.; Arnold International Movers, Inc.; Astron Forwarding Company; 
BINL Incorporated; Burnham Service Company, Inc.; Cavalier Forwarding, 
Inc.; Classic Forwarding, Inc.; Davidson Forwarding Company; Deseret 
Forwarding International, Inc.; Foremost Forwarders, Inc.; Gateways 
International, Inc.; Global Worldwide, Inc.; Great American 
Forwarders, Inc.; Hi-Line Forwarders, Inc.; International Services, 
Inc.; Island Forwarding, Inc.; Jet Forwarding, Inc.; Katy Van Lines, 
Inc.; Lincoln Moving & Storage; Miller Forwarding, Inc.; Northwest 
Consolidators; North American Van Lines; Ocean Air International, 
Inc.; Senate Forwarding, Inc.; Shoreline International, Inc.; Stevens 
Forwarders, Inc.; Von Der Ahe International, Inc.; Wold International, 
Inc.; Zenith Forwarders, Inc.; 
A Advantage Forwarders, Inc.; Sentinel International Forwarding, Inc.; 
T.R.A.C.E. International, Inc.; Acorn International Forwarding 
Company; AAA Systems, Inc.; A.C.E. International Forwarders; American 
Red Ball International, Inc.; Apex Forwarding Company, Inc.; Armstrong 
International, Inc.; Arpin International Inc.; Art International 
Forwarding, Inc.; Atlas Van Lines International Corporation; Coast 
Transfer Company, Inc.; Crystal Forwarding, Inc.; CTC Forwarding 
Company, Inc.; Diamond Forwarding, Inc.; Dyer International, Inc.; 
Harbour Forwarding Company, Inc.; HC&D Forwarders International, Inc.; 
Jag International, Inc.; The Kenderes Group, Inc.; Pearl Forwarding, 
Inc.; Rainier Overseas, Inc.; Rivers Forwarding, Inc.; Ryans's World; 
Sequoia Forwarding Company, Inc.; A-1 Relocation, Inc. d/b/a A-1 
Movers of America; A-1 Moving & Storage, Inc.; Able Forwarders, Inc.; 
A Columbia Forwarders; Aero Mayflower Transit, Inc.; Lile 
International Companies d/b/a American Movers; American Red Ball 
Transit Co.; American Van Services, Inc.; Andrews Van Lines, Inc.; 
Apollo Express Van, Inc.; A. Arnold & Son Transfer & Storage Company, 
Inc.; Paul Arpin Van Lines, Inc.; Art and Paul Moving & Storage; 
Associated Forwarding, Inc.; Associated Storage and Van, Inc.; Atlas 
Van Lines, Inc.; Bekins Van Lines Co.; Burnham World Forwarders; 
Carrier Transport International, Inc.; Carlyle Van Lines, Inc.; 
Coastal Moving Company; Conrad Group, Inc.; Davidson Transfer & 
Storage Co., Inc.; Denoyer Bros. Moving & Storage Co.; Door To Door 
Moving & Storage; Exhibit Transport, Inc.; Ferriss Warehouse & 
Storage; Fogarty Van Lines, Inc.; Global Van Lines, Inc.; Horne 
Storage Co., Inc.; Lift Forwarders, Inc.; Lynn Moving and Storage, 
Inc.; A.D. McMullen, Inc.; Mid-State Moving & Storage Inc.; Movers 
Unlimited, Inc.; Nilson Van & Storage; North American Van Lines, Inc.; 
Northwest Consolidators, Inc.; Ogden Transfer & Storage Co.; OK 
Transfer & Storage, Inc.; Pan American Van Lines, Inc.; Riverbend 
Moving & Storage, Inc.; Royal Forwarding, Inc.; Sells Service, Inc.; 
South Hills Movers, Inc.; Stanley's Transfer Co., Inc.; Starck Van 
Lines, Inc.; StarTrans International, Inc.; Stearns Forwarders, Inc.; 
Stearns Moving & Storage of Kokomo, Inc.; Stevens Van Lines, Inc.; 
Terminal Storage Company, Inc.; United Van Lines, Inc.; Von Der Ahe 
Van Lines, Inc.; Wainwright Transfer Co. of Fayetteville, Inc.; and 
Weathers Bros. Transfer.

2. The small business protesters have also protested the agency's 
small business set-aside determinations, which are the subject of 
another decision of today.

3. Some protesters maintain that it remains unclear how the agency 
intends to allot 50 percent of the eligible shipments to the pilot 
program.  As we have previously indicated, the agency has stated that 
orders under the existing program and under the pilot program will be 
randomly allocated on a per shipment basis.  See Aalco Forwarding, 
Inc., et al., B-277241.8, B-277241.9, supra, at 7 n.6.  In any event, 
we agree with the Army that the solicitation does not have to identify 
the agency's internal procedures for managing the allotment of 
shipments and we have no reason to question the contracting officer's 
statement that the shipping offices will identify the eligible 
shipments and assign them equitably between the current program and 
the pilot program.  

4. Certain tariff provisions are specifically excluded from 
application under this solicitation.  For example, the tariff's peak 
season (summer) transportation rates are inapplicable.

5. There are 53 traffic channels (38 domestic and 15 international) 
under the pilot program from the three origin states.  Some of the 
traffic channels are partially set aside for small business.

6. Contrary to the assertions of some of the protesters, the 
solicitation contains provision for price adjustment, FAR  sec.  52.222-43, 
in the event of adjusted wage determinations during the contract term.  
RFP at 32.  Because the RFP is issued under the commercial item 
procedures of FAR part 12, the SCA is inapplicable to subcontractors.  
FAR  sec.  12.504(a)(10).

7. Contrary to some protesters' assertions, there is no ambiguity as 
to the minimum.

8. The $25,000 contract minimum is based on an average shipment cost, 
although the number of shipments actually equating to the $25,000 
contract minimum will vary depending on the prices proposed for each 
channel, the weight of each shipment, whether any accessorial services 
and storage are ordered, and whether the shipments are domestic or 
international.

9. Some protesters now contend that instead of $25,000 as the uniform 
minimum for each contract, the contract minimums should take into 
account the substantial and significant variances in the awarded 
contracts, and the obligations assumed by the awardees with regard to 
domestic and international services, traffic volume per channel, 
number of channels awarded per contract, and contractors' committed 
daily capacity per contract.  However, we note that the $25,000 
contract minimum was established by MTMC in response to earlier 
protests by many of these same protesters against the RFP's previous 
contract minimums of an aggregate minimum guarantee (approximately 10 
percent of the total projected annual pilot program cost) broken down 
by each traffic channel, and then designated in the aggregate for each 
contractor in proportion to the capacity each contractor committed to 
the channels for which it received award.  In the earlier protests, 
the protesters stated that "[t]he need for identical, fixed minimums 
and maximums . . . is obvious" and requested that the solicitation 
instead state the minimum to be guaranteed each contractor.  In 
response, MTMC agreed that the RFP did not clearly state the minimum 
guaranteed quantity and amended the solicitation accordingly to 
provide a contract minimum of $25,000 per contractor, and the 
protesters have given us no convincing reason to find that this is 
insufficient consideration.

10. Contrary to some protesters' assertions, we find no ambiguity with 
regard to the stated maximums.

11. The agency also states that the added percentage accounts for the 
possibility that contractors providing exceptional service might be 
offered additional shipments above and beyond their committed daily 
capacities.

12. Some protesters contend that the RFP fails to provide a reasonable 
estimate of MTMC's requirements for the pilot program because the 
historical data supplied with the RFP may not reflect MTMC's projected 
requirements, especially as the most recent fiscal year 1996 data 
evidences a significant decline in shipments on some of the 
international channels.  We have previously found reasonable the 
agency's position that the historical information is the best 
available to the government.  Aalco Forwarding, Inc., et al., 
B-277241.8, B-277241.9, supra, at 8 n.9.  The protesters have not 
persuaded us that the inclusion of the recent historical data for 
fiscal year 1996 warrants a different conclusion, or that MTMC need 
provide further assurances that no further adjustments to the data are 
needed.  Additionally, MTMC states that any current information on 
base closings or force reductions potentially affecting the number of 
shipments will be furnished to interested parties whenever it becomes 
available (the agency states it does not yet have such information).

13. According to the contracting officer, had such data been 
available, it would have been provided as estimates in the RFP, and an 
extended or total price for each service could then have easily been 
obtained by multiplying each offeror's proposed unit price by the 
estimated quantity for each accessorial service.

14. The protesters contend that since, in calculating the average cost 
per shipment for the contract maximums, the agency included a 
percentage for accessorial services, the agency must have information 
that can be used for estimates of accessorial services.  However, 
there is no indication that the agency has information that would 
allow it to provide quantity estimates for each type of accessorial 
service for which the RFP requests prices, and the protesters have not 
shown that reasonable estimates are otherwise available.

15. The contracting officer also states that by including all 
accessorial services that may be ordered in the notional shipment, she 
will be able to take into consideration unbalanced offers which might 
not otherwise be evaluated.

16. MTMC had initially determined that the SCA did not apply to this 
RFP.  In earlier protests, other protesters alleged that the RFP 
should have incorporated the SCA and applicable DOL wage 
determinations.  After meeting with DOL officials concerning this 
matter, the contracting officer concluded that the procurement was 
indeed subject to the SCA, requested wage determinations from DOL, and 
proceeded to amend the solicitation to incorporate the relevant SCA 
clauses and wage determinations.  

17. Although tariffs are no longer filed with the ICC following the 
enactment of the ICC Termination Act of 1995, Pub. L. No. 104-88, 
carriers are still required to publish their tariff rates.  49 U.S.C.  sec.  
13702 (Supp. I 1996).

18. These statutes also exempt government traffic moving at the 
reduced rates from application of 41 U.S.C.  sec.  5 (1994), which requires 
advertisement for proposals and contracts for supplies or services for 
the government.  In contrast to the current program, the pilot program 
is being advertised and conducted under FAR procedures, and offers can 
be based on percentage increases, not just reductions, to the 
specified tariff.

19. Under these procedures, the contractor initiates the "conformance 
process" on a Standard Form 1444, Request for Authorization of 
Additional Classification and Rate, which is submitted to the 
contracting officer for review.  The contracting officer then submits 
the form with recommendation to the DOL Wage and Hour Division for 
appropriate action.  Here, the contracting officer notes that no 
prospective offerors have contacted her at any time to inquire or 
complain about occupations which were not listed in the RFP's wage 
determinations.