futile to urge that small business receive a greater share of government work when the basic economics of profit tend to discourage subcontracting of work that small businesses are particularly able to handle. It seems to us that most of the government policies aimed at assisting small business in government procurement are based upon the concept of surveillance and periodic reviews and studies rather than any workable framework of specific laws which would guarantee a reasonable share of government work to small business. For instance, the informal requirements that prime contractors subcontract a certain percentage of their work to small business tend to be followed or not followed depending upon how much pressure Congressional committees or the Small Business Administration apply. A more specific legal structure, perhaps penalizing prime contractors for failure to meet definite standards for subcontracting to small firms, would undoubtedly prove more effective and would remove the need for so much supervision, study and review. We realize, of course, that this is a terribly complicated area and that any proposal to change the basic legal framework entails long and difficult deliberations by Congress. But in the long run such an approach might be more effective and easier for both small and large firms to follow. We appreciate this opportunity to express our views on the subject of your current hearings and if we can be of further assistance in providing information. please feel free to call on us. Sincerely yours, STUART T. O'NEAL, President. (The subcommittee's acknowledgment follows:) SELECT COMMITTEE ON SMALL BUSINESS, Washington, D. C., May 22, 1968. Mr. STUART T. O'NEAL, National Tool, Die & Precision Machining Association, Dear Mr. O'NEAL: This is in reference to the statement you recently offered for the record of the hearings held by the Subcommittee on Government Procurement and Economic Concentration of the House Small Business Committee to review Government small business procurement policies and practices. We appreciate receiving the information and your views regarding the Department of Defense weighted guidelines policy, the paper profusion problem, and certain other practices objected to as being detrimental to the small subcontrac tor in the tool and die industry. Your statement will be made a part of the Subcommittee's hearing record and your name has been placed on the list of interested persons to receive copies as soon as they are available for distribution. In this record you will also find reference to the testimony presented to our Committee by Mr. Philip R. Marsilius.. past president of your association, in the July 1966 hearings. Your interest in our Subcommittee's work is appreciated. Sincerely yours, JAMES C. CORMAN, Member of Congress, Chairman Procurement Subcommittee. THE POSITION OF SMALL BUSINESS IN GOVERNMENT PROCUREMENT Part IV.-COMMENTS BY GOVERNMENT AGENCIES IN RESPONSE TO INDUSTRY VIEWS AND COMPLAINTS (The subcommittee invited the Government agencies involved in the complaints and views presented by witnesses on behalf of small business to submit comments for the record. The subcommittee's invitations and the responses were ordered to be inserted as follows:) Subject: Unduly restrictive specifications. Department: Army. Firm: Pulmosan Safety Equipment Corp., Flushing, N.Y. (The subcommittee's request for comments follows:) Hon. STANLEY R. RESOR, SELECT COMMITTEE ON SMALL BUSINESS, DEAR MR. SECRETARY: This is in reference to hearings conducted by the Subcommittee on Government Procurement and Economic Concentration of the House Small Business Committee to review the procurement policies and practices of Federal departments and agencies and to determine their effect on small business. Mr. Howard M. Weiss, Pulmosan Safety Equipment Corp., Flushing, New York, testified that certain unwarranted practices employed by U.S. Army Edgewood Arsenal in the procurement of paint spray respirators limited competition, increased costs to Government, and unjustly eliminated his company as a supplier. The matter is a pending Subcommittee case study and the pertinent information in that file will be inserted in the hearing record. In view of the additional information and further views presented by Mr. Weiss in the hearing, we invite you to review the enclosed testimony and submit your comments for the hearing record. Your response in six copies by June 18 will be appreciated. Sincerely yours, JAMES C. CORMAN, Chairman, Procurement Subcommittee. (1027) (Army's response follows:) DEPARTMENT OF THE ARMY, Hon. JAMES C. CORMAN, DEAR MR. CORMAN: This is in reply to your letter of 29 May 1968 to the Secretary of the Army inviting comments on the testimony of Mr. Howard M. Weiss of Pulmosan Safety Equipment Corporation before your Subcommittee on 13 March 1968 regarding procurement of paint spray respirators by Edgewood Arsenal. The last purchase made by Edgewood Arsenal using Military Specification MIL-R-51057(A) (MU) dated 11 December 1964 was a contract awarded in March 1966 as a result of Invitation for Bids AMC (A)-18-935-66-564. The information sought by Mr. Weiss as to the reasons the Invitation for Bids cited the Military Specification which required a dual cartridge type respirator was furnished him by the Contracting Officer, Edgewood Arsenal, by letter dated 18 February 1966. No purchases of paint spray respirators were made by Edgewood Arsenal after March 1966 until award of a contract in April 1968 as a result of a solicitation which was a 100% small business set-aside. This solicitation cited Federal Specification GGG-M-125d, a performance specification. The original decision by Edgewood Arsenal to specify dual cartridge type respirators was based upon the points raised in the Equipment Improvement Report from the U. S. Army Ordnance Plant, Mainz, Germany, a copy of which was furnished your Subcommittee on 12 October 1966. At the request of Congressman Abraham J. Multer in May 1966 to substantiate the continued procurement of dual cartridge type respirators, the Army Materiel Command made a new survey of user and storage depots to determine the minimum qualitative requirements for paint spray respirators. Copies of these evaluation reports were also furnished your Subcommittee on 12 October 1966. I trust this information will be of assistance to you. Sincerely, ROLAND B. ANDERSON, Major General, USA, Director, Materiel Acquisition. Subject: Fresh fruit and produce. Cerniglia Produce Co., Forest Park, Ga. Manhattan Fruit Contracting Co., New York City, N.Y. (The subcommittee's request for comments follows:) SELECT COMMITTEE ON SMALL BUSINESS, Lt. Gen. EARL C. HEDLUND, DEAR GENERAL HEDLUND: This is in further reference to the hearings conducted by the Subcommittee on Government Procurement and Economic Concentration of the House Small Business Committee to review Government procurement regulations and practices and to determine their effect on small business. As you know, representatives of the fresh fruit and produce industry testified that various policies and practices of your agency in the procurement of fresh fruits and produce tend to limit competition and, in certain respects, are detrimental to small business and the Government. Their complaints, views and proposals for remedial action are set forth in the enclosed copy. In accordance with the Subcommittee's practice in such matters, we invite you to review the testimony and submit your comments and response to be inserted in the hearing record for the Committee's consideration and evaluation. It will be appreciated if you would let us have your response in six copies by June 17, 1968. Chairman, Procurement Subcommittee, Select Committee on Small Business, House of Representatives, Washington, D.C. DEAR MR. CORMAN: This is in response to your letter of 29 May 1968, which invited review of and comments on testimony received by your Subcommittee on 14 March 1968. This testimony concerned the procedures followed by this Agency in the procurement of fresh fruits and vegetables for the Military Services. The testimony has been reviewed and this Agency's comments are enclosed. The copy of the testimony forwarded with your letter is also returned herewith. Sincerely, Enclosure. Lt. Gen. EARL C. HEDLUND, Director. The role of the Defense Supply Agency in providing subsistence support to the Military Services (Army, Navy, Air Force and Marine Corps) was discussed in detail in testimony by Brigadier General Robert E. Lee before your Subcommittee on 5 December 1967. While there has been no substantial change in procedures since that time, amplification with respect to certain points raised by Mr. Friedman and Mr. Weinstein in their testimony are set forth below. Although these comments are not specifically directed to each part of the testimony, they are intended to cover the pertinent areas discussed and the recommendations made. They also are intended to provide a summary of the policy and procedures currently applicable to this area of DSA procurement. The Defense Supply Agency, through the Defense Personnel Support Center, Philadelphia, Pennsylvania, is responsible for the procurement and supply of perishable subsistence to the Military Services and selected Federal civil agencies in the Continental U.S. and overseas areas. This mission is carried out through eight Subsistence Regional Headquarters located throughout the U.S. The primary objective is to provide the Armed Forces with fresh fruits and vegetables of high quality in accordance with standards established in Federal specifications which are sufficiently definitive to assure supply support with high quality fresh produce. During Fiscal Year 1967 the total dollar value of all subsistence procurements by the Agency for the Military Services was $1,280 million. Of this total $75.8 million was for fresh fruits and vegetables. Approximately 90 percent of the total dollar value of fresh fruits and vegetables procured both in terminal markets and growing areas was awarded to small business. Fresh fruits and vegetables are procured to Federal specification which include USDA grade standards. Solicitations, and the resultant contracts, refer to the applicable Federal specification, set forth the required USDA grade, and include any special requirements applicable to the product being procured. All suppliers are requested to submit their offers on this basis. Procurements by the Subsistence Regional Headquarters are initiated as a result of firm requisitions submitted by customer activities on a cyclic basis. These requisitions are based on anticipated actual usage requirements, predicated on carefully planned menus compiled by technicians having expert knowledge of such factors as troop acceptability, nutritional needs, food costs and availability of supplies. Subsequent to the receipt of these cyclic requisitions from customers, requirements for individual items are consolidated by delivery period to determine carlot/trucklot (CL) requirements in straight or mixed lots, and less than carlot/trucklot (LCL) requirements. A delivery period is normally one week, Monday through Friday. Consolidation of mixer loads of fruits and vegetables are limited to those items which are compatible for shipping, competitively available from the same general growing area, and normally for which a minimum of fifty (50) or more units (crate, carton, box, etc.) are required. Those requirements which can be more economically satisfied by direct delivery to the customer activity versus delivery to a supply point for consolidation with other items for further shipment to a customer activity are also determined. Less than carlot/trucklot (LCL) quantities are normally purchased from the local fresh produce terminal markets. Carlot/trucklot (CL) quantities are normally referred to the appropriate DPSC Field Buying Office for purchase and shipment direct from the growing areas. In addition, interested suppliers, including local terminal market dealers, located outside of the growing areas, who have indicated an interest in bidding on CL procurements for the region involved, are also afforded an opportunity to participate. If a terminal market dealer in one section of the country feels he can compete for CL requirements to be shipped to other areas not under the jurisdiction of the SRH covering his area, he may apply for, and be placed on, the bidders' lists at the SRH for the other areas and will be solicited as requirements arise for the items for which he is listed. In this manner, a terminal market dealer could compete for CL requirements emanating from all regional headquarters. These procedures, with the exception of the inclusion of terminal market vendors in solicitations for carlot/trucklot quantities, have been in effect for many years. The reference by Mr. Friedman to a change in policy in 1966, we believe, was not a change in policy, but a closer adherence to the previously established policy. The inclusion of terminal market dealers in carlot/trucklot solicitations was instituted in 1967, was a consequence of questions raised by the Subcommittee and industry, to provide all interested concerns an opportunity to participate. With the exception of overseas requirements for special pack lettuce, purchases are made FOB destination, with acceptance at destination, for both CL and LCL quantities. A single all inclusive price is solicited and vendors assume intransit risk to the first destination. Whenever lettuce requirements are requisi |