Procurement List; Additions

On November 1, 22, December 20, 1996, February 14, March 7, 28 and April 4, 1997, the Committee for Purchase From People Who Are Blind or Severely Disabled published notices (61 FR 56511, 59401, 67306, 62 FR 6946, 10519, 14883 and 16135) of proposed additions to the Procurement List.

The Following Comments Pertain to the Envelope, Translucent (7530-01- 354-3983+2)

Comments were received from one of two current contractors for these envelopes. The contractor indicated that it has been a longtime supplier of the envelopes, and that production of them for the Government is the anchor business of one department of the plant where the contractor produces the envelopes. Without this anchor business, the contractor speculated that the department would be closed and its employees discharged. The contractor also noted that it recently modified a production machine to make the envelopes in a more efficient manner, and that these efficiencies and the contractor's investment would be lost if the envelopes are added to the Procurement List. The contractor is a very large corporation, and the impact on its sales of losing this business is insignificant. The Committee is not adding the total Government requirement for one of the three types of these envelopes to the Procurement List, so some of the business will remain available for competitive procurement from this contractor. For this reason, the likelihood of the contractor's department being closed is lessened. Given the size of the contractor's operations, the Committee considers it unlikely that any affected employees could not be employed elsewhere in the plant's operation. The contractor will be able to use its modified equipment to produce these envelopes for its commercial business and the Government business left open to competition, so the Procurement List addition will not cause the loss of this investment. Moreover, if the modified equipment reduces production costs and those savings are reflected in the contractor's prices to the Government, the Committee's pricing system will assure the similar savings are reflected in the prices charged the Government by the nonprofit agency.

The Following Comments Pertain to Folder, Zebley Claim (7530-00-000- 0430/2)

Comments were received from the current contractor in response to a request for sales data. A Member of Congress also wrote to request a review of the contractor's contentions. The contractor claimed that the Committee's Procurement List additions have disproportionately affected the company, that the company has lost millions of dollars in sales and many jobs as a result of the additions, and that the company has not fully recovered from the losses. The contract value for these zebley claim folders represents less than one percent of the contractor's 1996 annual sales. The Committee last added an item to the Procurement List where the contractor was the current contractor in January 1994. The contractor's sales have continued to grow significantly since that time. The contractor did not provide any details on the jobs it claims were lost because of Procurement List additions. Consequently, the Committee has concluded that the current addition will not have a severe adverse impact on the contractor or its work force.

The Following Comments Pertain to Janitorial/Custodial, Mare Island Naval Shipyard, Vallejo, CA

Comments were received from the previous contractor for the service when it submitted its sales data to the Committee. The contractor noted that it has been greatly affected by base closures, as indicated by its net income figures for the past three years. Removal of this service from competition, according to the contractor, would hinder its ability to stay in business while making the transition from dependence on Government work. Despite the reduction in the contractor's business in recent years, this service represents only a small percentage of the contractor's remaining total sales. As a result, the Committee does not believe the adverse impact will be severe, even when the Committee's 1994 action in adding to the Procurement List an even smaller contract where the firm was the current contractor is taken into account. While the contractor's sales have declined since 1994, the firm has not shown that it will inevitably suffer grievous financial harm as a result of the Committee's action, which will create jobs for people with severe disabilities who would likely otherwise be unemployed, and will restore

employment opportunities at a nonprofit agency which lost all of its contracts under the Committee's program due to earlier Government downsizing.

The Following Comments Pertain to Laundry Service, Basewide, USAF Academy, Colorado Springs, CO

Comments were received from the current contractor for the laundry service. The contractor claimed that addition of the service would create a severe financial hardship for the company as the loss would be hard to recoup in the local market, where prices have been severely depressed due to competition from large firms located in a nearby large metropolitan area. The contractor indicated that it is still recovering from a 1992 loss of another contract at the same Government installation to a large company. The contractor also noted that several years ago it reorganized its operation to serve the local Government market, and as a result Government contracts have become a large part of its business. The Committee's principal indicator of adverse impact on a contractor is the percentage of the contractor's sales which would be lost if a commodity or service were added to the Procurement List. In this case, the percentage is well below the level that the Committee normally considers to be severe adverse impact. Even if the contractor's dependence on the local Government market and possible residual effects of the 1992 loss are considered, the Committee does not believe that the impact of this Procurement List addition on the contractor rises to the level of severe adverse impact. The contractor's decision to concentrate on the local Government market was a business decision for which the contractor must be prepared to bear the consequences. The contractor has not demonstrated that loss of this contract will specifically harm the company in an irreparable way. As the Procurement List addition will create jobs for people with severe disabilities, a group with an unemployment rate over 65 percent, the Committee feels that any potential ill effects for the contractor are outweighed by this creation of jobs. After consideration of the material presented to it concerning capability of qualified nonprofit agencies to provide the commodities and services and impact of the additions on the current or most recent contractors, the Committee has determined that the commodities and services listed below are 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 commodities and services to the Government. 2. The action will not have a severe economic impact on current contractors for the commodities and services. 3. The action will result in authorizing small entities to furnish the commodities and services 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 commodities and services proposed for addition to the Procurement List. Accordingly, the following commodities and services are hereby added to the Procurement List:

Commodities

Office and Miscellaneous Supplies (Requirements for the Defense Supply Service--Washington for the following locations: Park Center #4, 4501 Ford Avenue, Alexandria, Virginia; Skyline #3, 5109 Leesburg Pike, Alexandria, Virginia; Rosslyn, 1401 Wilson Boulevard, Arlington, Virginia) Envelope, Translucent, 7530-01-354-2327, 7530-01-354-3982 (Fort Worth, TX depot only), 7530-01-354-3983 Folder, Zebley Claim, 7530-00-000-0430, 7530-00-000-0432 Scourer, Copper, M.R. 505 Bath Puff, M.R. 566 Master Baster, M.R. 802 Towels, Seasonal, M.R. 1009

Services

Grounds Maintenance, Basewide, Lackland Air Force Base, Texas Grounds Maintenance, U.S. Army Reserve Center, Parkersburg, West Virginia Janitorial/Custodial, Mare Island Naval Shipyard, Vallejo, California Laundry Service, Basewide, United States Air Force Academy, Colorado Springs, Colorado Laundry Service, U.S. Air Force Academy, Cadet Dining Hall, Colorado Springs, Colorado

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. 97-13629 Filed 5-22-97; 8:45 am] BILLING CODE 6353-01-P