Engineering Spectrum, Incorporated, No. 3899 (March 21, 1994) Docket No. SIC-94-3-3-15 UNITED STATES OF AMERICA SMALL BUSINESS ADMINISTRATION OFFICE OF HEARINGS AND APPEALS WASHINGTON, D.C. SIC APPEAL OF: ) ) Engineering Spectrum, ) Incorporated ) ) Docket No. SIC-94-3-3-15 Appellant ) ) Solicitation No. ) RFP F41624-94-C-4001 ) Department of the Air Force ) Brooks AFB, Texas ) DIGEST Where the Standard Industrial Classification (SIC) code for a solicitation is amended, but the bid opening date is not extended at that time, the operative dates for determining the timeliness of the SIC appeal under 13 CFR 121.1705(b) are the date of the SIC code amendment and the bid opening date in effect at the time of that amendment. A solicitation requiring science and technological support for a research laboratory that is involved in the development and testing of biological systems for military aircraft missions is properly classified under SIC code 8731 (Commercial Physical and Biological Research: Other Commercial Physical and Biological Research), having a 500-or-fewer employees size standard. DECISION March 21, 1994 BLAZSIK, 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. Issues Whether the appeal was timely filed. Whether the correct Standard Industrial Classification (SIC) code to be assigned to this solicitation is SIC code 8711 or SIC code 8731. Facts On February 4, 1994, the Department of the Air Force, Brooks Air Force Base, Texas, issued this solicitation for "Science and Technology Engineering Support" and classified it under Standard Industrial Classification (SIC) code 8731 (Commercial Physical and Biological Research: Other Commercial Physical and Biological Research), having a 500-or-fewer employees size standard. The solicitation was originally issued under SIC code 8711 (Engineering Services: Other Engineering Services), with a $2.5 million average annual receipts size standard, but was amended to SIC code 8731 on February 25, 1994. The date for receipt of bids was March 9, 1994, and this date was not extended by the amendment. By letter postmarked February 25, 1994, Engineering Spectrum, Incorporated (Spectrum) filed a timely appeal from the Contracting Officer's classification arguing that the original designation, i.e., SIC code 8711 was appropriate. 1/ The solicitation's Statement of Work sets out the purpose of the solicitation as follows: This effort will provide the professional engineering and technical support, materials, equipment, and supplies required to modify and develop specialized laboratory facilities and associated equipment; to acquire, measure, and control physical, physiological and environmental parameters for research laboratory use. Specific work performance will be focused on Armstrong Laboratory mission areas to include aircrew systems, human resources, occupational and environmental health and aerospace medicine. The Statement of Work explains that the Armstrong Laboratory conducts research covering all aspects of human systems. Some examples of the types of systems that are being studied and developed in the Armstrong Laboratory include aircraft escape systems, advanced anti-G suits, simulators related to aircrew training, computer-based training systems, systems to detect cardiovascular diseases, and systems to measure environmental hazards associated with military systems and operations. The solicitation requires the following personnel specialists to perform the work: A senior engineer, a senior scientist, a scientist with a PhD degree in biomedical or a related field, a programmer who is proficient in computer programming, a senior technician, a research assistant, a draftsman, a technical writer, a computer operator, and typists. The more specific functions that the successful contractor must provide includes the following: - Exercise contract administrative and financial management functions. - Review systems, subsystems and associated equipment to identify deficiencies, problem areas, and needed refinements. - Recommend corrective actions. - Develop design packages for research equipment. - Conduct independent laboratory tests on systems, subsystems, material and components of research equipment. - Design and develop instrumentation, equipment systems and subsystems to include tests, evaluations, installations and modifications. - Design, develop, implement, and test computer programs associated with individual efforts. The contractor will be required to develop software and supporting guidance. In its appeal, Spectrum asserts that engineering functions are central to the solicitation and supports this assertion by citing a portion of the solicitation that states: 1.4 Engineering: The engineering support provided herein will include electronic design, mechanical design, machining, and fabrication and assembly in order to design, modify, upgrade, and maintain extensive laboratory and simulation facilities.... Spectrum also argues that the specific functions required of the contractor, supra, such as "develop design packages for research equipment..., conduct independent laboratory tests...and design, develop, implement, and test computer programs..." are all engineering, not biological research functions. Accordingly, not a single function to be performed relates to the ability of the contractor to conduct physical or biological research. In consequence, Spectrum concludes that the correct SIC code classification should be 8711, not SIC code 8731. By letter postmarked March 4, 1994, the Contracting Officer filed a reply to the appeal. He asserts that, from a technical perspective, when adding the expected labor categories and estimated hours from the solicitation, the "true figure for engineering and engineering-related hours" merely account for 12,000 hours. On the other hand, the scientist or research- related hours (including Senior Scientist, Scientist, Senior Technician, Technician, and Research Assistant, supra) account for 24,000 hours. The Contracting Officer notes that this is a 2 to 1 ratio of expected contractor hours for science-related functions and personnel, rather than the engineer category. Most importantly, the scientific personnel will be the lead personnel for all the tasks to be undertaken on this solicitation, with the engineering personnel providing support. Accordingly, in the Contracting Officer's view, SIC code 8731 is the most appropriate classification. Discussion We conclude that Spectrum's SIC appeal was timely filed. Pursuant to 13 CFR 121.1705, timeliness for filing of a SIC appeal is determined by the length of time between issuance of the solicitation and the bid opening date. Section 121.1705(b)(1) and (2) read as follows: Except as provided in paragraph (b)(2) of this section, an appeal from a SIC code designation must be filed with the Office of Hearings and Appeals no later than 10 days (exclusive of Saturdays, Sundays, and legal holidays) before the bid opening day or deadline for submitting proposals or quotations as specified in the solicitation. If a solicitation is modified to extend the bid opening day or deadline for submitting proposals or quotations, the 10 day period for filing shall be from the date designated in the modification. Where the bid opening day or deadline for submitting proposals or quotations is less than 30 days after the issuance of the invitation for bids...the appeal must be filed with the Office of Hearings and Appeals no later than 5 days (exclusive of Saturdays, Sundays, and legal holidays) before the bid opening day or deadline for submitting proposals.... If a solicitation is modified to extend the bid opening day...the 5-day period for filing shall be from the date designated in the modification. As noted, the Contracting Officer had amended the classification from SIC code 8711 to SIC code 8731, but did not extend the bid opening date of March 9, 1994. Spectrum's appeal was postmarked February 25, 1994, the date the Contracting Officer changed the SIC code classification. It is well established that where amendments are made to the solicitation, timeliness may be affected, but only by those amendments which alter the original SIC code or size standard assigned to the solicitation. See, for example, SIC Appeal of Industrial Maintenance Services, No. 2044 (1984) and cases cited there. We have also held that where the SIC code classification is amended but the bid opening date is not extended at that time, as occurred here, the operative dates for determining the timeliness of a SIC appeal are the date of the SIC code amendment (here February 25, 1994) and the bid opening date in effect at the time of the amendment (here March 9, 1994). Since the amendment of the solicitation and the bid opening is 30 days or less, the five-day rule set forth in 13 CFR 121.1705(b)(2) applies, and Spectrum's appeal must have been filed no later than 5 working days prior to the bid opening date. Consequently, Spectrum's appeal filed on February 25, 1994, is timely. SIC code 8731, selected by the Contracting Officer, is described in the SIC Manual thus: 2/ Establishments primarily engaged in commercial physical and biological research and development on a contract or fee basis. Noncommercial research establishments funded by endowments, grants, or contributions are classified in Industry 8733. Separate establishments of aircraft, guided missile, or spacecraft manufacturers primarily engaged in research development on these products are classified in Manufacturing, Major A Group 37. Examples shown under this description are biological research, commercial; chemical laboratories, commercial research: except testing; engineering laboratories, commercial research: except testing; and research and development, physical and biological: commercial. SIC code 8711, requested by Spectrum, is described in the SIC Manual, as follows: Establishments primarily engaged in providing professional engineering services. Establishments primarily providing and supervising their own engineering staff on temporary contract to other firms are included in this industry. Establishments providing engineering personnel, but not general supervision, are classified in Industry 7363. Establishments primarily engaged in providing architectural engineering services are classified in Industry 8712, and those providing photogrammetric engineering services are classified in Industry 8713. Some examples under this description include engineering services: industrial, civil, electrical, mechanical, petroleum, marine, and design; and machine tool designers. While Spectrum is correct in its contention that the solicitation requires certain engineering services, the solicitation's statement of work, detailed above, shows that the principal nature of the work to be performed by the successful contractor is research regarding physical, physiological, and environmental "parameters for research laboratory use." The statement of work also shows that the specific work requirements will be in assisting the research in progress or being developed in the Armstrong Laboratory concerning aircrew environmental health and aerospace medicine. We have confined the application of SIC code 8731 to those solicitations whose primary thrust is scientific research, as is the case here. SIC Appeal of Malcolm Thomas Industries, Inc., No. 3667 (1992). On the other hand, we have reserved SIC code 8711 for solicitations where the primary work to be performed is strictly engineering and computer services. SIC Appeal of Challenger Engineering Inc. No. 3728 (1993). See, also, SIC Appeal of Challenger Engineering, Inc., No. 3711 (1992), where SIC code 8711 was found to be appropriate for a solicitation requiring systems engineering and technical analysis. Moreover, the Contracting Officer's argument that the labor hours for scientists and research-related matters account for 24,000 hours in contrast to the 12,000 hours for engineer- related work further compels the application of SIC code 8731. Finally, and most significantly, we note that scientific personnel will be the lead performers on the contract, whereas engineering personnel will provide only support to the scientists. Accordingly, SIC code 8731, with a 500-or-fewer employees size standard is the appropriate classification. Conclusion The solicitation was properly classified under SIC code 8731, with a 500-or-fewer employees size standard. The appeal is DENIED, and the Contracting Officer's designation is AFFIRMED. This constitutes the final decision of the Small Business Administration. See 13 CFR 121.1720(a), (b), and (c). __________________________________ Gloria E. Blazsik (Presiding) Administrative Judge ___________________________________ Elwin H. white (Concurring) Administrative Judge ____________________________________ G. Stephen Wright (Concurring) Administrative Judge _______________ 1/ The question of the timeliness of this appeal will be discussed later. 2/ Standard Industrial Classification Manual, Office of Management and Budget, 1987 edition.