Service Technicians, Inc., No. 3788 (June 9, 1993). Docket No. SIC-93-4-19-46 UNITED STATES OF AMERICA SMALL BUSINESS ADMINISTRATION OFFICE OF HEARINGS AND APPEALS WASHINGTON, D.C. SIC APPEAL OF: ) ) Service Technicians, Inc. ) ) Appellant ) Docket No. SIC-93-4-19-46 ) Solicitation No. ) N62477-93-B-1026 ) Department of the Navy ) Quantico, Virginia ) DIGEST A solicitation for the repair of heating and air conditioning equipment should be classified as a service, under Major Group 76, rather than as construction, under Major Group 17, Special Trade Contractors. DECISION June 9, 1993 PHILLIPS, Administrative Judge, Presiding: Jurisdiction This appeal is decided under the Small Business Act of 1958, 15 U.S.C. 632 et seq., and the regulations codified at 13 CFR Part 121. Issue Whether the captioned solicitation should be classified under Standard Industrial Classification (SIC) code 7623 or 1711. Facts On April 1, 1993, the Department of the Navy, Quantico, Virginia, issued the captioned solicitation for the inspection, maintenance, service, repair, labor, equipment, materials, replacement parts, transportation and supervision for both routine maintenance service and emergency service on gas fired boilers, air handling units, forced air gas furnaces, electric air conditioning systems, heat pumps, gas water heaters, and chiller units in various housing areas. The solicitation was set aside for competition by small busi nesses and classified under SIC code 7623, "Refrigeration and air-conditioning Service and Repair Shops," to which a $3.5 million average annual receipts size standard applies. The solicitation requires that [t]he Contractor...provide inspections as required on all systems, annual seasonal preventive maintenance service and changeover requirements of all heating, air conditioning and control systems, equipment, components, and related items, and respond to routine and emergency service calls. It further provides that "[t]he Contractor's estimate shall be based on the assumption that all of the equipment is in good working order...." Bids were due on May 4, 1993, and award of the contract is pending. On April 19, 1993, Service Technicians, Inc. (STI), the incumbent contractor, filed a timely challenge to the SIC code designation, alleging that the solicitation should be classified under SIC code 1711, "Plumbing, Heating and Air Conditioning," to which a $7 million average annual receipts size standard applies. Characterizing the work to be performed under the solicitation as "the installation of air condition [sic] equipment on a military base," STI contends that SIC code 1711, rather than SIC code 7623, is proper because "the procurement requires the services of a Specialty Trade Contractor to perform construction work" and because lowering the size standard from $7 million, under which the "identical, predecessor contract was previously classified as "Base Housing Maintenance," will occasion a "severe reduction" in the number of small businesses eligible to bid on the procurement. 1/ Discussion STI argues that the solicitation should be classified in terms of the type of contractor necessary to perform it. This argument, if appropriate, would not be dispositive, however, since such a contractor could repair as well as install such equipment. Furthermore, and more importantly, _121.902, concerning the establishment of the size standard for a procurement, clearly provides at paragraph (b) that the "proper SIC code designation for the goods or services being procured is that which best describes the principal purpose of the procurement," not the SIC code applicable to the firm performing the work. 2/ This is not a solicitation for the installation of plumbing, heating and air conditioning equipment. The solicitation specifies that the equipment to be inspected, repaired and maintained should be assumed to be in "good working order." Thus, SIC code 1711, which is listed in the SIC Manual, 1973 ed., under Major Group 17, "Construction - Special Trade Contractors," and would include a solicitation for the installation of such equipment, is inapplicable. SIC code 7623, on the other hand, is listed under Major Group 76, "Miscellaneous Repair Services," and is described as follows: Refrigeration and Air-conditioning Service and Repair Shops Establishments primarily engaged in servicing and repairing household and commercial electrical refrigerators and air-conditioning and refrigeration equipment. Establishments primarily engaged in servicing and repairing gas refrigeration equipment are classified in Industry 7699, and those repairing automotive air-conditioning equipment are classified in Industry 7539. SIC code 7699, referenced in this description, is entitled "Repair Shops and Related Services, Not Elsewhere Classified," and includes "boiler cleaning," "boiler repair shops, except manufacturing," "furnace cleaning service," and "gas appliance repair service." SIC codes 7623 and 7699 both have a $3.5 million average annual receipts size standard, and in the absence of any evidence in the record that gas-fired equipment pre-dominates, and the lack of practical significance attending further inquiry on this issue, we affirm the Contracting Officer's classification of the contract under SIC code 7623. Conclusion The Contracting Officer's selection of SIC code 7623 is AFFIRMED; the appeal is DENIED. This constitutes the final decision of the Small Business Administration. See 13 CFR 121.1720. ________________________________ Jane E. Phillips (Presiding) Administrative Judge ________________________________ Michael S. Cole (Concurring) Administrative Judge ________________________________ Elwin H. White (Concurring) Administrative Judge _______________ 1/ The classification "Base Housing Maintenance" requires the provision of more than one special trade construction activity and is clearly inappropriate to a solicitation all of whose activities pertain to "plumbing, heating and air conditioning." 2/ STI's argument that the selection of a $3.5 million rather than a $7 million average annual receipts size standard is improper because it will limit the field of eligible bidders is thus not relevant.