solicited bids from 14 dealers and manufacturers and the only responsive bids received were on the Hobart mixer. As indicated in the first paragraph of the Naval Supply Research and Development Facility report of February 13, the question of whether a company is at any point in time a sole source of a given item is difficult to resolve, since another firm may have private intentions to enter the market at the first opportunity, or one may be willing to alter its commercial or standard equipment in order to compete for a particular procurement or business. However, if Hobart Manufacturing Company is the only concern which produces a mixer with the unrestricted bowl-changing feature, then it follows that it may have been afforded the opportunity of quoting a high price under the assumption that the only competition it need fear from other bidders would be from dealers in the Hobart item whose cost for the item is known to the company. We have no information indicating that the Hobart Manufacturing Company's price of $2,978.75, which is $21.25 less than the dealer's (Casson Corporation) bid, is unreasonable, and the primary responsibility for determining whether a bid price is, or is not, reasonable is properly imposed upon the contracting agency rather than this Office. However, in the procurement of items known to be proprietary, it is our view that it is preferable to utilize a method of procurement which enables the Government to assure itself of the reasonableness of the price.

Since the award has been made and since, for the reasons stated, we do not find that the nonuse of Federal Specification 00-M-38b in the procurement was wholly without justification, we do not feel that we would now be justified in disturbing the action taken, and your protest is denied.

However, in view of the facts stated in your letter of May 4, 1964, indicating that the restrictive features of the invitation here complained of are being continued in later procurements, we are bringing the matter to the attention of the Secretary of the Navy and suggesting that procedures for obtaining deviations from standard specifications be reviewed and strengthened.

[B-154065]

Subsistence-Per Diem-Military Personnel-On Board VesselsAvailability of Quarters and Messing Facilities

An enlisted man who while stationed in Japan performs temporary duty on board a Navy vessel that maintained berthing and messing facilities oriental in nature for the national civilian mariners that manned the vessel which did not meet the standards of the United States Navy may, nevertheless, not be paid a per diem allowance commensurate with the amount he expended for the food he purchased for the duration of the trip prior to embarking, paragraph 4250-8 of the Joint Travel Regulations providing that per diem is not payable for any period of temporary duty aboard a Government vessel when both Government quarters and mess are available, and the messing facilities available to the

member during his temporary tour of duty constituting a "Government mess" within the contemplation of paragraph 1150-4, defining the term to include any general or service organizational mess, the member is not entitled to the payment of the per diem claimed.

To S. F. Leader, Department of the Navy, July 28, 1964:

Further reference is made to your letter dated February 18, 1964, and enclosures, requesting an advance decision as to the legality of payment of a per diem allowance to Philip R. Trost, AMS3, 544 97 63, USN, under the circumstances described. Your request was assigned PDTATAC Control No. 64-12.

By Order No. T-500-64 dated November 8, 1963, Mr. Trost was authorized to proceed to Sagita, Japan, for a period of about 5 days' temporary duty to accompany an A3B aircraft, BUNO 138909, on surface shipment to repair facilities. He traveled to Sagita aboard the USNS LST 550 owned by the United States but manned by Japanese National civilian mariners, it being reported that by U.S. Navy standards adequate berthing and messing facilities were not available to him on the ship. It is stated that Mr. Trost occupied a small unheated compartment above the bridge equipped with one canvas bunk, using blankets borrowed prior to his departure since sheets and blankets were not available aboard the ship; and, since Western cuisine was not available, he had purchased canned and dried foodstuffs to last the trip to Sagita. Your question is whether Trost may be paid an allowance commensurate with the amount expended for food while on board the vessel.

Paragraph 4250 of the Joint Travel Regulations provides that a member of the uniformed services is entitled to travel per diem allowances at the rates uniformly established by the Secretaries of the uniformed services for periods of travel and temporary duty performed under competent orders outside the continental United States except in certain specified circumstances. Paragraph 4250-8 of the regulations provides that per diem is not payable for any period of temporary duty aboard a Government vessel when both Government quarters and mess are available. Paragraph 1150-5 provides that the term "Government quarters," unless otherwise qualified, means any sleeping accommodations owned or leased by the United States Government and paragraph 1150-4 defines the term "Government mess," unless otherwise qualified, to include any general or service organizational mess. The purpose of the exception is to deny per diem when temporary duty is performed on Government vessels when subsistence facilities are available there, the use of which would not involve the above-normal subsistence expenses for which per diem is authorized. 38 Comp. Gen. 626.

The regulations, however, contain no provision which would permit payment of the per diem allowance on the basis that conditions or circumstances aboard ship made quarters and subsistence not acceptable

by U.S. Navy standards. Regardless of the fact that the messing facilities aboard the USNS LST 550 were Oriental in nature and the food served was not the kind to which Mr. Trost was accustomed, payment of a per diem allowance for the period of his claim is prohibited by the cited regulations since messing facilities actually were available.

Accordingly, it is concluded that the messing facilities aboard the USNS LST 550 during the period Mr. Trost performed temporary duty on it constituted a Government mess within the contemplation of paragraph 1150-4 of the Joint Travel Regulations and that payment of the per diem claimed is not authorized. Mr. Trost's original orders are returned herewith.

[B-154576]

Contracts Awards-Labor Surplus Areas-Failure To Furnish Information Effect

Under an invitation providing that responsible labor surplus area concerns submitting responsible bids on the non-set-aside portion of the procurement who offer to perform more than 50 percent of manufacturing and production costs in persistent and substantial labor surplus areas will qualify to negotiate in the five priority groups established, a small business concern, the second low bidder on the non-set-aside portion of the procurement, offering to perform 41 percent of costs in persistent labor surplus areas and 12 percent in substantial labor surplus areas, who although responsive to the invitation only furnished information for the third priority group-small business concerns that will perform in substantial labor surplus areas-may not have the information that general and administrative expenses were inadvertently not considered as manufacturing and production cost accepted to change the concern's third priority classification to the top group-persistent labor surplus area concerns to obtain first consideration eligibility, thereby passing over bidders who had qualified in the prescribed manner.

To the Secretary of the Army, July 29, 1964:

Reference is made to letter of June 26, 1964, from the Deputy Director, Procurement & Production, Headquarters, Army Materiel Command, submitting for decision the protest of Polan Industries, Inc., against prior negotiations with any other bidder for the labor surplus set-aside portion under invitation AMC (T)-11-184–64-300 (AF)-LS.

With respect to the set-aside portion, the invitation provides that negotiations will be conducted only with responsible labor surplus area concerns (and small business concerns to the extent indicated) who have submitted responsive bids or proposals on the non-set-aside portion at a unit price within 120 percent of the highest award made on the non-set-aside portion in the following order of priority:

Group 1. Persistent labor surplus area concerns which are also small business concerns.

Group 2. Other persistent labor surplus area concerns.

Group 3. Substantial labor surplus area concerns which are also small business concerns.

Group 4. Other substantial labor surplus area concerns.

Group 5. Small business concerns which are not labor surplus area

concerns.

The invitation provides further that within each of the above groups negotiations with such concerns are to be conducted in the order of their bids on the non-set-aside portion, beginning with the lowest responsive bid.

There is included in the invitation a definition of the two types of labor surplus area concerns. A "persistent labor surplus area concern" is defined as one which agrees to perform, or cause to be performed, a substantial proportion of a contract in persistent labor surplus areas. It is stated further that a concern is deemed to perform a substantial proportion of a contract in such areas if the costs which the concern will incur on account of manufacturing or production performed in such areas amount to more than 50 percent of the contract price. A "substantial labor surplus area concern" is defined as one which agrees to perform, or cause to be performed, a substantial proportion of a contract in substantial labor surplus areas. In that regard it is provided that a concern shall be deemed to perform a substantial proportion of a contract in substantial labor surplus areas if the costs which the concern will incur on account of manufacturing or production performed in substantial and persistent labor surplus areas amount to more than 50 percent of the contract price.

In addition, the invitation states that the bidder agrees that, if awarded a contract as a persistent labor surplus area concern under the set-aside portion of the procurement, he will perform, or cause to be performed, a substantial proportion of the production in areas classified at the time of award, or at the time of performance of the contract, as persistent labor surplus areas; and that if awarded a contract as a substantial labor surplus area concern under the set-side portion of this procurement, he will perform, or cause to be performed, a substantial proportion of the production in areas classified at the time of award, or at the time of performance of the contract, as substantial or persistent labor surplus areas.

Further, the invitation and amendment 1 to the invitation both provide that a bidder desiring to be considered for award as a labor surplus area concern on the set-aside portion of the procurement shall identify the areas in which he proposes to perform, or cause to be performed, a substantial proportion of the contract, the former stipulating that such identification should be made in the bid, the latter indicating the place in the bid where the bidder should identify the areas. In connection with the latter, the amendment states that if a bidder sets forth more than one labor surplus area, he shall further

indicate for each such area the minimum percentage of the contract price which he will incur as costs on account of manufacturing or production of the contract. Thereafter follows an admonition that if a bidder fails to indicate such percentages as required his bid will be construed as designating for performance of a substantial proportion of the contract that area which is least favorable to the bidder for the purpose of qualifying the bidder for award of the set-aside and the determination of the order of priority for negotiation for the set-aside.

Polan Industries is the second low bidder on the non-set-aside portion of the procurement. By virtue of the fact that Polan is small business and that in the space provided for the identification of areas of performance that bidder named persistent labor surplus areas and showed percentages totaling 41 percent there for and named substantial labor surplus areas and showed percentages totaling 12 percent therefor, the contracting officer proposes to classify the bidder in priority group 3 for negotiation. Polan contends, for reasons that will be set forth below, that it should be classified in group 1. Were such a classification made, it would be eligible for first consideration for award since it would be the lowest bidder in that priority group, the other two bidders therein having bid higher prices.

Polan contends it is entitled to first priority for a variety of reasons. It states that inasmuch as the invitation called for "minimum percentages" of manufacturing or production, it showed that a minimum of 41 percent of the contract price would consist of manufacturing or production costs which would be incurred in persistent labor surplus areas and did not include general and administrative costs which it estimates would be 10 percent of the contract price because the invitation did not specifically mention general and administrative costs. Polan indicates further that it did not believe that the provision in the invitation that bidders would be penalized if they failed to indicate "such percentages as required" had any bearing upon it, since that was interpreted as applying where a bidder did not show any percentages. Polan states that it is responsive to what was called for and that if the information it furnished does not make it entirely clear that it is entitled to first priority in negotiating for the set-aside portion, the contracting officer should seek such additional information as may be required. In that connection, both in representations to the contracting officer and in a letter of June 30, 1964, to our Office, it is contended that B-153267, June 8, 1964, is pertinent to the matter in that it was indicated therein that Polan could furnish information after bid opening to show that it would perform in a persistent labor surplus area. The effect of the decision is said to be that the matter involved is one going to responsibility of the bidder which could be resolved after bid opening. Also, in the June 30 letter, it is pointed