U.S. Grounds Maintenance, Inc., No. 4601 (December 31, 2003)
Docket No. SIZ-2003-10-09-59
                    UNITED STATES OF AMERICA
                  SMALL BUSINESS ADMINISTRATION
                 OFFICE OF HEARINGS AND APPEALS
                        WASHINGTON, D.C.
                                )
SIZE APPEAL OF:                 )
                                )   Docket No. SIZ-2003-10-09-59
U.S. Grounds Maintenance, Inc.  )
                                )   Decided:  December 31,  2003
     Appellant                  )
                                )
HUBZone Decertification         )
Case No. 4-2003-56              )
Office of Government            )
 Contracting, Area IV           )
Chicago, Illinois               )
                           APPEARANCES
        Frederick D. Stehlik, Esq., Shaun M. James, Esq.,
                         Gross & Welch,
          for Appellant U.S. Grounds Maintenance, Inc.
                             DIGEST
Alleged   unfairness  by  Small  Business  Administration   (SBA)
officials, which appears from the record to be mere diligence  in
investigating a potentially other than small firm  and  does  not
result  in any factually inaccurate information being used  as  a
basis  for  a size determination, is not a ground to  overturn  a
size determination.
A  size protest is sufficiently specific if it provides notice of
the grounds on which the challenged firm's size is questioned and
provides an evidentiary basis for the allegations.
An   Appellant's  receipt  from  SBA  officials   of   inaccurate
information  concerning size determination regulations  does  not
estop  SBA  from applying the applicable regulations when  making
the size determination.
Concerns  are affiliates of one another when one concern controls
or  has the power to control the other, or a third party controls
or has the power to control both.
When  the sole shareholder of a challenged firm owns 50% or  more
of  seven firms; owns the largest single block of stock, compared
to all the others, of another firm; owns, together with his wife,
the  majority  of  another  firm;  and  owns,  together  with  an
individual  with whom he has many common investments, a  majority
of  three  other firms, he will be considered to control  all  of
these firms and all the firms must be found to be affiliated.
                            DECISION
HOLLEMAN, Administrative Judge:
                          Jurisdiction
     This appeal is decided under the Small Business Act of 1958,
15 U.S.C. Section 631 et seq., and 13 C.F.R. Parts 121 and 134.
                             Issues
      Whether alleged unfairness by Small Business Administration
(SBA) officials is a ground to overturn a size determination.
      Whether  a  size  protest is sufficiently  specific  if  it
provides  notice  of the grounds on which the  challenged  firm's
size  is  questioned and provides an evidentiary  basis  for  the
allegations.
      Whether  an  Appellant's  receipt  from  SBA  officials  of
inaccurate  information concerning size determination regulations
estops  SBA from applying the applicable regulations when  making
the size determination.
      Whether  concerns are affiliates of one  another  when  one
concern  controls or has the power to control  the  other,  or  a
third party controls or has the power to control both.
     Whether, when the sole shareholder of a challenged firm owns
50%  or  more  of seven firms; owns the largest single  block  of
stock,  compared  to  all  the others,  of  another  firm;  owns,
together  with his wife, the majority of another firm; and  owns,
together  with  an  individual  with  whom  he  has  many  common
investments,  a  majority  of  three  other  firms;  he  will  be
considered to control all of these firms.
                         I.  BACKGROUND
            A.  The Request for a Size Determination
      U. S. Grounds Maintenance, Inc. (Appellant), is a firm that
was    a    certified   participant   in   the   Small   Business
Administration's (SBA) Historically Underutilized  Business  Zone
(HUBZone)  program.  On April 10, 2003, SBA's Procurement  Center
Representative (PCR) for Nebraska and Iowa contacted  SBA's  Area
IV  Office  of Government Contracting (Area Office)  in  Chicago,
Illinois, and raised the issue of whether Appellant was  eligible
as  a  small  business  to participate in  the  HUBZone  program.
Eventually,   the   PCR's   concerns   reached   the    Associate
Administrator  for the Office of HUBZone Empowerment  Contracting
(AA)  and,  on May 15, 2003, the AA requested the Area Office  to
conduct a formal size determination on Appellant.
      The  basis  for  the  AA's  request  was  that  Appellant's
principal,  John L. Hoich, President and 50% owner,  owned  three
other  companies, Hoich Enterprises, Inc.; Hoich Irrigation;  and
Hoich  Lemke Building.  Further, Appellant had two other  owners,
each  of whom owned 25% of Appellant and together owned two other
firms,  M&A Enterprises and Golf Tech Designs.  On May 16,  2003,
the  Area  Office informed Appellant of the request  for  a  size
determination,  stated  that it would  make  a  determination  of
Appellant's  size  as  of "the present date,"  and  requested  it
respond to the AA's concerns and submit a completed SBA Form 355,
together with certain other information.  The information was due
within  three business days.  Appellant received an extension  of
time  to May 30th to submit its response, and did so on June 2nd.
Following  this initial response, the Area Office made additional
requests  for  information.  Ultimately, on  September  3,  2003,
Appellant submitted a revised SBA Form 355, together with a  more
complete response.
                   B.  The Size Determination
      On  September  24, 2003, the Area Office  issued  its  size
determination, determining Appellant's size as of September  3rd,
the  date  it submitted its revised SBA Form 355.  The applicable
size  standard was North American Industry Classification  System
(NAICS)  code  561730, Landscaping Services, with a corresponding
$6  million annual receipts size standard.  The Area Office found
that,  as of that date, Mr. Hoich was the sole owner of Appellant
and  Hoich Enterprises, Inc.  The Area Office further found  that
Mr.  Hoich  was involved in the following business ventures,  all
real estate firms (the real estate firms):
      CCJJ, LLC (CCJJ):  Mr. Hoich is a 50% member.
    Raintree Apartments, Inc. (Raintree):  Mr. Hoich owns 50%.
Jerry Slusky is the other 50% shareholder.
    Hilton Head Apartments, LLC (Hilton Head):  Mr. Hoich, with
46.67%, is the largest member.  Mr. Slusky is a 33.333% member.
    Park Properties, LLC (Park):  Mr. Hoich is a 50% member.
Mr. Slusky also is a 50% member.
    Hoich Family, LLC (Family):  Mr. Hoich and his immediate
family own 100%.
    DH, LLC (DH); PacWest, Inc. (PacWest); and Pacific West
Properties, LP (Pacific West):  Mr. Hoich is the sole member of
DH; he owns 50% of PacWest; and the two firms together own
50.035% of Pacific West.  The remaining 49.965% of Pacific West
is owned by Slusky, LP, which is 100% owned by Mr. Slusky.
    Oak Brook Partners, LLC (Oak Brook Partners); and Oak Brook
Apartments, LLC (the Oak Brook firms):  Mr. Hoich is a 75% member
of Oak Brook Partners, LLC, which is a 40% member of Oak Brook
Apartments, LLC; Mr. Hoich and his wife together own another 40%
of Oak Brook Apartments, LLC.
    AHA Equities, LLC; and Southwestern Plaza, LLC
(Southwestern):  Mr. Hoich is a 40% member of AHA Equities, LLC,
which is a 50% member of Southwestern.  The other 50% member is
JJJ Investments, LLC, a firm owned by Mr. Slusky.
    192nd & Harrison Partnership, Ltd. (Harrison):  Mr. Hoich is
50.01% member.
    Overlook Plaza, LLC (Overlook):  Mr. Hoich is 50% member and
manager.
    Lakeside 168, LLC and The Shoppes at Lakeside, LLC
(Shoppes):  Mr. Hoich owns 100% of Lakeside 168, LLC, which owns
50% of The Shoppes at Lakeside, LLC.  The other 50% is owned by
Smart Buildings, LLC, which is 50% owned by Mr. Slusky.
      Appellant's  attorneys, in their submissions, characterized
these  entities as passive real estate investments and  thus  not
relevant  to  the size determination.  The Area Office  concluded
that  this contention was contradicted by SBA's size regulations.
It  also  noted  that the SBA has established size standards  for
Lessors  of  Residential  Buildings  and  Dwellings,  NAICS  code
531110;   and   Lessors  of  Nonresidential   Buildings   (except
Miniwarehouses), NAICS code 531120; and, therefore, views  rental
real  estate  as a business activity.  The Area Office  concluded
that,  through  his  50%  or  more ownership  interests,  or  his
ownership  of the largest single block of stock in an entity,  or
his  identity  of  interest with his wife,  or  his  identity  of
interest  with Mr. Slusky (an individual with whom  he  had  many
common  investments), Mr. Hoich had the power to control all  the
entities  named above.  Accordingly, because Mr.  Hoich  is  sole
shareholder  owner of Appellant and Hoich Enterprises,  the  Area
Office concluded that Appellant is affiliated with all the  firms
named  above.  The Area Office aggregated the annual receipts  of
all  the firms, concluded that these exceeded the applicable size
standard, and determined that Appellant was other than small.
                         C.  The Appeal
      On  October  9,  2003, Appellant filed the instant  appeal.
Appellant attaches to the appeal additional evidence, in the form
of  affidavits  from  Mr. Hoich and Appellant's  counsel;  and  a
number  of  documents, largely copies of correspondence regarding
this  case,  most of which are already in the Area  Office  file.
Appellant  also  requested that the full record before  the  Area
Office be made available to its counsel and that it be allowed to
present oral argument.
      Appellant  discusses at length the process leading  to  the
size determination.  Appellant mentions several times discussions
the  AA  had  with its counsel, who allegedly received assurances
from  the AA that Mr. Hoich's passive investments in real  estate
were  irrelevant to the size determination.  Appellant relied  on
these representations by the AA.
      Appellant  also discusses its many conversations  with  the
Area  Office's  size determination specialist  (SDS).   Appellant
documents  the SDS's many attempts to elicit further  information
from  it relative to the size determination and her requests  for
additional  information from Appellant as  more  of  Mr.  Hoich's
investments came to her attention.  Appellant speculates that the
SDS  was  fed  misleading  information concerning  its  business.
Appellant  objects to the SDS's statements that she felt  it  and
its attorneys were not being forthcoming with her, when Appellant
was  merely  attempting  to  eliminate irrelevant  documentation.
Appellant  also objects to the SDS's rejecting their reliance  on
the assurances of the AA.
      Appellant discusses the renewal of a contract at Offutt Air
Force  Base  and accuses SBA officials of manipulating  the  size
determination  process  to  prevent  its  receiving   an   award.
Appellant   further   accuses  SBA's  Omaha   Office   of   being
nonresponsive and giving inaccurate information about the  status
of  the  size determination-for example, the SDS told Appellant's
counsel she was still working on the decision the day before  the
Area  Office issued it.  Appellant accuses the SDS of  not  being
impartial  in conducting the size determination.  Appellant  also
discusses its communication with a Nebraska congressman about its
concerns about how the size determination was handled.
      Appellant argues that the receipts of the real estate firms
should  not  be  considered in determining its  size.   Appellant
asserts  that Mr. Hoich is a passive investor in these firms  and
does  not  take  an active part in the management of  the  firms.
These  receipts  represent Mr. Hoich's personal  income  and  his
interests in the firm are his personal assets.  It argues that  a
principal's  personal  assets and income are  not  considered  in
determining a firm's size, citing Size Appeal of ROH,  Inc.,  SBA
No.  SIZ-4040 (1995); and Size Appeal of Triple P Services, Inc.,
SBA  No. SIZ3607 (1992). [1]  The definition of "annual receipts"
is  concerned  only  with  the  receipts  of  the  firm  and  its
affiliates   and  excludes  the  personal  income  of  individual
principals.  Further, Appellant asserts it is an error of fact to
assert  Mr.  Hoich  has  the  power to  control  Hilton  Head  or
Southwestern  Plaza,  because he has does  not  have  a  majority
interest in those firms.
      Appellant further asserts the Area Office erred in  relying
on  Size  Appeal  of Ben Fitzgerald Real Estate Services,  L.L.C.
d/b/a Rosemark, SBA No. SIZ-4542 (2003).  There, true affiliation
existed  between  the firms in question, and  the  principals  in
question were actively involved in management of the firms.
      Appellant  also  asserts the Area Office's  statement  that
affiliation  between  concerns is  determined  by  one  concern's
control  or  power  to control another concern,  or  by  a  third
party's control or power to control both, is in error.  Appellant
argues  that  this is not an absolute rule of law, because  SBA's
size  determination Standard Operating Procedure states only that
affiliation  is  "generally" determined in  this  way.   Standard
Operating  Procedure 90 01 3, "Size Determination Program"  (Jan.
28,  1998), Ch. 5, Paragraph 5.a (SOP).  Appellant argues, citing
Size  Appeal  of Inland Dredging Company, LLC, SBA  No.  SIZ-4350
(1999),  that affiliation must be determined using a totality  of
the circumstances test.
      Appellant  argues that the affiliation rule is  not  a  net
worth   test   for  an  individual.   Under  the  Area   Office's
interpretation, Mr. Hoich could own a large amount of residential
real  estate  personally, and his rental income would  not  apply
towards Appellant's annual receipts; yet, rental income from  any
business  concern he controls, no matter how small, is  included.
Appellant argues this is not rational, and thus an error of law.
       Finally,  Appellant  asserts  that  Mr.  Hoich's  business
strategy  and  investments have been praised by the officials  at
Nebraska's  Small Business Development Center (SBDC),  suggesting
this implies some type of sanction by SBA.
                   D.  Supplemental Pleadings
      On  October 10, 2003, this Office issued the initial Notice
and  Order in this case.  On October 14, 2003, Appellant filed  a
copy  of  the  Size Determination, which had not accompanied  the
Appeal  Petition,  and it become clear that  this  case  did  not
involve  a  procurement.  Accordingly, on October 15,  2003,  the
Administrative  Judge  issued a Corrective  Order,  deleting  the
requirement  to  submit a solicitation and  making  three  points
regarding  the  instant appeal:  First, evidence  not  previously
submitted to the Area Office is usually not allowed on appeal, 13
C.F.R. Section 134.308(a); second, discovery is not permitted  in
size  appeals,  13  C.F.R.  Section  134.310;  and,  third,  oral
hearings  are  not  held  except on a  finding  of  extraordinary
circumstances, 13 C.F.R. Section 134.311.
      On  October 28, 2003, Appellant moved to extend the  record
closing  date, so that its counsel could examine the Area  Office
file,  part  of  the record before this Office.   That  day,  the
Administrative  Judge granted the motion and  set  the  close  of
record  for  November  17,  2003.   Counsel  for  Appellant  then
examined the Area Office file here at this Office.
      On  November  19,  2003,  Appellant  filed  a  Supplemental
Pleading,  together  with  a  motion  for  leave  to  file  late,
assigning  as reason for the late filing counsel's miscalculation
of   the   deadline.    Appellant  asserts,  citing   13   C.F.R.
Sections 121.1001(a)(6) and 126.800, that this size determination
is  void  ab initio, because it was initiated by the PCR and  the
SDS,  who  had  no authority to do so.  Further, Appellant  takes
issue  with comments by the PCR about Mr. Hoich, which it asserts
are  prejudicial to it and tainted the entire process.  Appellant
also  asserts,  citing  13 C.F.R. Section 121.1007(a),  the  Area
Office should not have conducted a size determination because  no
procurement  was  pending.  Appellant  further  argues  that  the
protest   was  insufficiently  specific  and  should  have   been
dismissed.   The  actions of the PCR and  the  SDS  were  fishing
expeditions  to support their predetermined conclusion  Appellant
was  not  a  small business and prevent Appellant from  receiving
contract awards.
                         II.  DISCUSSION
                      A.  Threshold Issues
      Appellant  filed  the  instant appeal  within  30  days  of
receiving the size determination. Thus, it is timely.   See  Size
Appeal  of  Communicar, Inc., SBA No. SIZ-4551, at 5  (2003);  13
C.F.R. Section 134.304(a)(2).
      The  Administrative  Judge will not consider  evidence  not
previously  presented to the Area Office that issued the  subject
size determination being appealed unless (1) the Judge sua sponte
orders  submission of such evidence; or (2) the  proponent  moves
its  admission, establishing good cause for its submission.  Size
Appeal  of Leonardo Technologies, Inc., SBA No. SIZ-4597,  at  13
(2003);  13 C.F.R. Section 134.308(a).  Here Appellant failed  to
make  a motion to admit its new evidence.  Even if Appellant had,
the new evidence is the affidavits of Mr. Hoich and his attorney,
recounting  their discussions with SBA officials  regarding  this
case,  and  is not probative of any material fact in  this  case.
The other documentation Appellant offers either is already in the
Area  Office  file  and thus redundant, or  is  irrelevant  here.
Accordingly,   the  Administrative  Judge  EXCLUDES   Appellant's
proffered new evidence.
       Appellant's  request  for  discovery  is  DENIED,  because
discovery   is  not  permitted  in  size  appeals.    13   C.F.R.
Section  134.310.   Appellant's request for an  oral  hearing  is
DENIED, because oral hearings are not held except on a finding of
extraordinary circumstances.  13 C.F.R. Section 134.311.
      Appellant's  motion  for  leave to  file  its  supplemental
pleading  late  is  GRANTED, because the late filing  is  due  to
excusable neglect, the motion is unopposed, and granting it  will
not prejudice the Agency.
      Appellant has the burden of proving, by a preponderance  of
the  evidence, all elements of its appeal.  Specifically, it must
prove  the  Area Office size determination is based  on  a  clear
error  of  fact or law.  See Size Appeal of Procedyne Corp.,  SBA
No. SIZ-4354, at 4-5 (1999); 13 C.F.R. Section 134.314.
                  B.  Alleged Procedural Errors
     The Administrative Judge notes first that this Office is not
empowered to make determinations as to any alleged misconduct  by
SBA officials and has neither the resources nor the authority  to
conduct  any  investigation.  If Appellant feels it has  suffered
fraud  or abuse at the hands of SBA officials, it should  file  a
complaint  with  SBA's Office of Inspector  General.   13  C.F.R.
Section 101.301.
      Appellant's reliance on statements by the AA and  the  SBDC
officials  is  misplaced.   Once  the  AA  requested   the   size
determination, it was made by the Area Director, relying  on  the
staff  work of the SDS.  13 C.F.R. Section 121.1002.  The AA  had
no  further role, and Appellant's contacts with him were a  waste
of  time  for all concerned.  Any suggestion that SBA is  somehow
estopped from finding Appellant other than small because  of  its
reliance on inaccurate advice from Agency officials is meritless.
The  United  States  cannot  be estopped  because  of  a  party's
reliance  on  inaccurate information from  its  officials.   Size
Appeal of L. Freedman & Associates, P.C., SBA No. SIZ-4247, at 6-
7 (1997).
      Appellant's argument that it was the subject of  an  unfair
investigation is not supported by the record.  What is clear here
is  that  the  PCR strongly suspected Appellant was not  a  small
business  and worked to bring his suspicions to the attention  of
the  appropriate  Agency officials.  Eventually, the  information
the  PCR  and SDS uncovered convinced the AA to request a  formal
size   determination.   The  Area  Office  then  made  the   size
determination.  This is how the process is designed to work.  The
PCR's  comments  did  not  taint  the  process  because  the  SDS
performed  the  staff  work  on the determination  and  the  Area
Director  was  the decision-making official.  The final  decision
was grounded in the factual record, not in speculations about Mr.
Hoich's character.
     Appellant's argument would have some force if it could point
to any inaccurate information or misstatement of fact in the size
determination or any inappropriate characterization  of  it.   It
has   not  done  so.   It  merely  speculates  about  information
"probably" given to the SDS.  It would be very serious indeed had
actual false information made its way into the size determination
because of malicious actions by Agency officials.  However, there
is  no  evidence  that this happened here.  Therefore,  the  size
determination  thus  must  be considered  wholly  factual.   T0he
Administrative  Judge thus concludes that it is commendable,  not
censurable, that some Agency officials were determined to get the
facts on Appellant's status. [2]
      Appellant's arguments that the size determination  is  void
because  it  was  initiated by the PCR's insufficiently  specific
complaints and that the PCR and SDS were not authorized to file a
protest  are  meritless.  These officials did  not  initiate  the
protest; they conducted a preliminary investigation and called it
to the attention of the AA, who did file the protest.  The AA had
authority to file the protest as the program official responsible
for the HUBZone program and its decertification process under  13
C.F.R.   Sections   126.503   and   126.900.    See   13   C.F.R.
Section 121.1001(b)(6).
       Further,  although  the  PCR's  initial  inquiry  was  not
specific,   the   AA's  protest,  which  identified   Appellant's
suspected  affiliates,  was  sufficiently  specific,  because  it
provided  notice  of  the  grounds on  which  the  AA  questioned
Appellant's  size  and  provided an  evidentiary  basis  for  the
allegations.   Size  Appeal  of  Dove  Mailing,  Inc.,  SBA   No.
SIZ-4415, at 2-3 (2000); 13 C.F.R. Section 121.1007(b).
      Appellant's  citations to 13 C.F.R. Sections 121.1001(a)(6)
and  126.800  are  inapposite, because these sections  deal  with
protests  involving a particular procurement, and no  procurement
is  at  issue  here.  Appellant's argument that the AA's  protest
could  be  not  considered  because  it  did  not  pertain  to  a
particular  procurement is meritless.  The  regulation  Appellant
cites  is  one  of a number of consecutive sections dealing  with
size  determinations  arising out  of  procurements.   13  C.F.R.
Sections  121.1003 - 121.1007.  Other regulations make  it  clear
that the size determination process also embraces requests for  a
size  determination not related to particular  procurements.   13
C.F.R.   Sections   121.1001(b);   134.304(a)(2);   see,    e.g.,
Communicar,  SBA No. SIZ-4551 (Expanded Economic Injury  Disaster
Loan Application).
     Accordingly, the Administrative Judge finds that Appellant's
procedural  objections to the size determination are  unsupported
by  any  legal authority.  Appellant has failed to object to  the
factual determinations in the size determination, and nothing  in
the  record contradicts the Area Office's findings.  Accordingly,
the  only  issue  remaining is whether the Area Office  erred  in
determining as a matter of law that Appellant was affiliated with
the real estate firms.
                  C.  The Issue of Affiliation
      The  Small  Business Act, 15 U.S.C. Section  631  et  seq.,
authorizes  SBA  to  establish size standards by  regulation,  in
order  to  determine which businesses are small  businesses.   15
U.S.C.  Sections 632(a)(2)(A); 634(b)(6).  SBA has  done  so,  at
Part 121 of 13 C.F.R.  It is these regulations, as interpreted by
this  Office's case law, that determine whether a firm  qualifies
as  a  small business.  Appellant's attempt to use one adverb  in
the  SOP  to vary the plain language of the regulation is risible
and does not merit further discussion.
     The regulation is clear as to the basic test for determining
affiliation:   "Concerns are affiliates of each  other  when  one
concern  controls or has the power to control  the  other,  or  a
third  party  or  parties controls or has the  power  to  control
both."  13 C.F.R. Section 121.103(a)(1).
      This  Office has consistently adhered to this  test.   See,
e.g.,  Size  Appeal  of  Concepts  in  Staffing,  Inc.,  SBA  No.
SIZ-4547,  at  4  (2003).  Appellant's attempt  to  replace  this
precedent  with a totality of the circumstances test is misplaced
and  reveals  a  fundamental misunderstanding of  the  law.   The
totality  of  the  circumstances test,  as  discussed  in  Inland
Dredging, SBA No. SIZ-4350, is used to determine whether concerns
control  or  have  power to control each  other.   It  is  not  a
substitute for the control test in Section 121.103(a)(1), but one
methodology used to determine whether control exists.  Id., at 6-
7. [3]
      Appellant  correctly asserts that an individual principal's
investments  and net worth, by themselves, are not  a  factor  in
determining a firm's size.  Were Mr. Hoich's investments in large
corporations, or small enough in each firm so that there  was  no
issue  of his having the power to control the firms, there  would
be  no  finding of affiliation.  The important point here is  not
the nature of Mr. Hoich's investments, or his day-to-day role  or
lack  thereof in the firms in which he invested.  Rather,  it  is
the Area Office's finding that his investments give him the power
to control the firms in which he invested.  It is this element of
control  that  is  vital  to  the  finding  that  the  firms  are
affiliated.
      Thus,  the Area Office found that a third party (Mr. Hoich)
had the power to control Appellant and all the real estate firms,
and  that  these firms were thus affiliated.  Because  the  firms
were  affiliated, the annual receipts of all the  firms  must  be
aggregated   in   determining  Appellant's   size.    13   C.F.R.
Section  121.103(a)(4).  The Area Office's conclusion  that  this
calculation renders Appellant other than small is not disputed by
Appellant and is supported by the record.  Accordingly,  the  one
issue  remaining is whether the Area Office erred in  determining
Mr. Hoich had the power to control the real estate firms. [4]
      Mr.  Hoich  individually owns 50% or more of the  stock  of
CCJJ,  Raintree,  Park, Family, DH, PacWest, Oak Brook  Partners,
Harrison,  Overlook, and Shoppes.  He clearly thus has the  power
to  control  these firms.  See Size Appeal of First International
Bank, f/k/a First National Bank of New England, SBA No. SIZ-4366,
at 7 (1999); 13 C.F.R. Section 121.103(c)(1).
     Mr. Hoich owns Hilton Head's largest single block, which  is
large compared to any other block, so he has the power to control
that firm.  See Size Appeal of Cellegy Pharmaceuticals, Inc.  SBA
No. SIZ-4439, at 5 (2001).
     Mr.  Hoich  has an identity of interest with his  wife,  and
thus  their  interests are aggregated in determining affiliation.
Size  Appeal of Specialized Technical Services, SBA No. SIZ-3833,
at  4 (1993); 13 C.F.R. Section 121.103(a)(3).  Accordingly,  Mr.
Hoich has the power to control the Oak Brook firms.
     Finally,  Mr. Hoich has a number of common investments  with
Mr.  Slusky,  and thus they are treated as one party  with  their
interests aggregated for the purposes of determining control  and
affiliation.   See  Size Appeal of Bunkoff  General  Contractors,
Inc.,   SBA   No.   SIZ-3804,   at  12-13   (1993);   13   C.F.R.
Section  121.103(a)(3).  Accordingly, Mr. Hoich must be found  to
have control of Pacific West and Southwestern as well. [5]
      Therefore,  the Administrative Judge finds  that  the  Area
Office  made  no clear error of fact or law in the  instant  size
determination.   Appellant is clearly affiliated  with  the  real
estate firms, because Mr. Hoich has the power to control all  the
firms, and their aggregated annual receipts exceed the applicable
size standard.  Thus, Appellant is other than small.
                        III.  CONCLUSION
      For the above reasons, the Administrative Judge AFFIRMS the
Area Office's size determination and DENIES the instant appeal.
      This is the Small Business Administration's final decision.
13 C.F.R. Section 134.316(b).
                                 CHRISTOPHER HOLLEMAN
                                 Administrative Judge
_________________________
     1   Appellant  alleges  it has contacted  the  principal  of
Triple  P  Services  and asserts that, like  Mr.  Hoich,  he  had
unrelated  investments  that  this  Office  ruled  were  properly
excluded when determining Triple P's size.
     2   Appellant's unhappiness with its interactions  with  the
SDS  during  the  size determination process seems  part  of  the
normal  give  and take between the Agency and a challenged  firm.
The  firm  does  not  want to give out information  it  considers
irrelevant;  however, the Agency, not the challenged  firm,  must
determine what is relevant.  See Size Appeal of Apex Group, Inc.,
SBA  No.  4300,  at  5-6 (1998).  Here, it appears  the  SDS  was
diligent  in extracting from Appellant information that Appellant
did  not  understand  was  relevant to  the  size  determination.
Again,  accusations  of  unfairness are  not  borne  out  by  the
existence of inaccurate facts in the size determination.   As  to
the telephone call where Appellant argues the SDS misinformed  it
about  the  status  of  the  determination,  it  seems  a  simple
misunderstanding, common when Federal officials  must  deal  with
frequent  status calls from firms and individuals  anxious  about
their cases.
     3  Appellant's citations to ROH, Inc., SBA No. SIZ-4040, and
Triple  P Services, SBA No. SIZ-3670, are inapposite, because  in
neither  case  did  this Office find that the  challenged  firm's
principal  controlled  the entities from which  he  received  the
investment income not included in determining annual receipts.
     4   Appellant's  argument  that  Mr.  Hoich  could  own  the
properties as an individual and not have their income included in
Appellant's  annual  receipts is meritless, considering  that  we
must  examine Appellant's status as it is actually organized when
size   is  determined  and  not  as  it  would  be  in  counsel's
alternative reality.
     5  There may be some question as to Mr. Hoich's control  of
AHA,  in  which he owns 40% of the stock, which is not  large  in
comparison  to any other share.  However, even if AHA's  receipts
are deducted from the calculation of Appellant's annual receipts,
it  remains large, so any error by the Area Office as to AHA  is,
at  most,  harmless.   See Size Appeal of  InfoTech  Enterprises,
Inc., SBA No. SIZ-4346, at 12 n.5 (1999).
                                            Posted: January, 2004