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B-192148 1 (1978-09-25)

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            FILE:  8-192148               DATE:1septmber 25, 1978

            MATTER  OF: Western Pilament Ia,

            DI3EST:

                Where solicitation erroneously conhained priority
                listing for labor surplus area set-astde derived
                from superseded Defensa,'Manpower Policy, agency
                properly refused to select awardee based on such
                superseded policy.  All parties--bidders andjcon-
                tracting activity--are on qonstructiv& notice, of
                change in policy relating to labor surplus area
                set-aside award preferences because of publication
                in Pederal Register


                Western Filament, Inc., (Western) pr.esth
           cancellation of the labor surplus area set-aside.portion
           of invitation for.bids (IFS) N,  DLA-500-78-B-0825 (IFB-
           0825) and the award of any contract und~r IFB No. DLA-
           500-78--1565  (IFB -1565) which is a redolicitdation of
           the canceleA.,portion of the former solicitation., Westow
           ern, the second low bidder for the set-'aside portion,
           contends thitaward  should have been made to it because
           the low.ibidder's priority forlabor surplus award was
           determined to be less than Western's.

               . Both 'Solicitatio nswere'issued by tie Defense.
           Industtial Supply Center (DISC), iPhiladelihia, Pennsyl-
           vania andd called for bids from small business firms
           for an annbfil requitemeits: contract to.provide poly-
           ester lacinq and'tying tapes.  In the firt solicita-
           tion, 50 'ercent of each of the two line items was
           set-a&'Wda f6Wsmall'business firms whi6h also qk lified
           as labor surplus area concerns. The IFB incorporated
           by reference the clause set forth in Defense Acqifisi-
           tion4Regulation,(DAR) 7-2003.4 and entitled Notice of
           Combined Small Business-Labor Surplus Area Set Aside
           (1975 OCT).
                The bids were opened on March 10,.1978 and the
           non-labor surplus area set-aside portion of each item
           was awarded to the low bidder, Eoh Corporation (Eon).
           This-award has not been protested. Although its bid for
           the labor surplus area set-aside portion was low, Eon

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