6 $ (SEE DD FORM 1423, EXHIBIT A HERETO)
ON JULY 24, 1969, 14 BIDS WERE OPENED AND ABSTRACTED. ASTROSPHERICS'
BID OF $385,066.60 WAS LOW WITH THE OTHER BIDS RECEIVED RANGING FROM
$392,571 TO $1,033,593.70.
BECAUSE YOUR BID FAILED TO STATE A PRICE IN THE AMOUNT COLUMN OF ITEM
4 (DATA), THE CONTRACTING OFFICER DETERMINED THAT YOUR BID WAS
NONRESPONSIVE AND THEREFORE REJECTED IT. IN CORRESPONDENCE TO THE
PROCURING ACTIVITY AND OUR OFFICE YOU CONTEND THAT SINCE DD FORM 1423
(CONTRACT DATA REQUIREMENTS LIST) IS A PART OF THE IFB, THE SUM OF THE
INDIVIDUAL AMOUNTS FOUND IN BLOCK 26, CAPTIONED "ESTIMATED TOTAL PRICE,"
OPPOSITE EACH ITEM OF REQUIRED DATA, REFLECTS THE PRICE FOR DATA CALLED
FOR BY ITEM 4. AS SUCH, YOU MAINTAIN, YOUR PRICE FOR ITEM 4 WAS CLEARLY
ASCERTAINABLE AND ITS OMISSION SHOULD BE WAIVED. IN ADDITION, YOU POINT
OUT THAT THE INSTRUCTIONS FOR COMPLETING DD FORM 1423, APPEARING ON THE
REVERSE THEREOF, INDICATE THAT THE ESTIMATED PRICES FILLED IN BLOCK 26
WILL NOT BE SEPARATELY USED IN THE EVALUATION OF OFFERS AND THAT THE
ESTIMATED PRICES ARE, IN FACT, THE EFFECTIVE ITEM 4 PRICE CALLED FOR BY
THE IFB.
WE CONCUR WITH THE DETERMINATION OF THE CONTRACTING OFFICER THAT YOUR
BID WAS NONRESPONSIVE TO A MANDATORY REQUIREMENT OF THE IFB. NOTE "B"
IN ITEM 4 OF THE IFB STATES: "NOTE B: OFFEROR TO QUOTE TOTAL PRICE FOR
ITEM 4. SEE INSTRUCTIONS FOR PRICING ON THE DD FORM 1423.'
WE CONSTRUE THIS NOTE AND THE INDICATION OF A DOLLAR SIGN IN THE
AMOUNT COLUMN OF ITEM 4 AS IMPOSING UPON A BIDDER THE OBLIGATION OF
STATING A PRICE FOR THAT ITEM IN THE SPACE PROVIDED. APPARENTLY, THIS
WAS ALSO YOUR UNDERSTANDING, SINCE IN EVERY OTHER INSTANCE YOU INSERTED
A PRICE IN THE APPROPRIATE SPACE ON THE SCHEDULE.
FURTHERMORE, WE DO NOT BELIEVE THAT THE INSTRUCTIONS FOR COMPLETING
DD FORM 1423 IN ANY WAY MODIFY THE ABOVE OBLIGATION. WHATEVER EFFECT OR
RELEVANCE THESE INSTRUCTIONS MAY HAVE APPEARS, IN THIS INSTANCE, TO BE
COMPLETELY OBVIATED BY THE PROVISION ON PAGE 15 OF THE SCHEDULE WHICH
ROVIDES: "ITEM/S) ---4---: CONTRACT DATA REQUIREMENTS LIST/S) (DD FORM
1423): THE CONTRACT DATA REQUIREMENTS LIST/S), DD FORM 1423, ATTACHED
HERETO, FORMS A PART OF THE SCHEDULE OF THIS CONTRACT EXCEPT FOR ANY
INSTRUCTIONS AND OTHER PRINTED MATTER THAT MAY APPEAR ON THE REVERSE
SIDE OF SAID FORM. * * *"
CLEARLY, THE INTENT OF THIS PROVISION WAS TO NEGATE THE OPERATIVE
EFFECT OF THE OBLIGATIONS AND ASSURANCES FOUND IN THE INSTRUCTION
SECTION ON THE REVERSE OF DD FORM 1423 AND TO RELEGATE THE PERTINENCE OF
THE INSTRUCTION TO ONLY THE COMPLETION OF THE FORM AND NO FURTHER.
IN B-161576, JULY 13, 1967, AN IFB PROVISION SPECIFICALLY REQUIRED
THE BIDDER TO BID ON FOUR SEPARATE ITEMS OF DATA. IN REACHING THE
CONCLUSION THAT HIS FAILURE TO SO BID RESULTED IN THE REJECTION OF THE
BID AS NONRESPONSIVE, WE DISCUSSED THE LEGAL CONSEQUENCES OF PRICES
FOUND IN BLOCK 26 OF DD FORM 1423 AND THOSE REQUIRED BY THE IFB TO BE
INSERTED OPPOSITE EACH OF THE FOUR DATA ITEMS. AS WE BELIEVE THAT
DISCUSSION APPLIES WITH EQUAL VALIDITY AND EFFECT TO THE PRESENT
SITUATION, IT IS SET OUT BELOW:
"YOU CONTEND, HOWEVER, THAT THE PRICES OF ITEMS 2 THROUGH 5 COULD NOT
HAVE BEEN CONSIDERED SEPARATELY IN BID EVALUATION, AND THAT THE
INVITATION DID NOT MAKE THE PRICING OF THESE ITEMS MANDATORY. YOU BASE
THE FORMER OBSERVATION ON THE ASSUMED IDENTITY OF DATA PRICING
INFORMATION REQUESTED IN ITEMS 2 THROUGH 5 AND THAT REQUIRED IN BLOCK 26
OF DD FORM 1423. HOWEVER, IT WOULD APPEAR THAT THE LATTER ARE ESTIMATED
PRICES WHICH ARE NOT TO BE USED FOR BID EVALUATION PURPOSES -WITHOUT
FURTHER ANALYSIS' BECAUSE OF THE VARIED METHODS CONTRACTORS MAY USE IN
DETERMINING THESE COSTS, AND PRESUMABLY SINCE BIDDERS HAVE THE OPTION TO
INCREASE OR DECREASE THE AMOUNT ESTIMATED. SEE DEPARTMENT OF DEFENSE
INSTRUCTION 5010.12, ENCLOSURE 5, PARAGRAPH 2 (B), SEPTEMBER 22, 1965.
WHILE THE DATA PRICES REQUIRED IN ITEMS 2 THROUGH 5 MIGHT REFLECT THE
SAME COSTS DETAILED IN BLOCK 26 OF DD FORM 1423 FROM AN ACCOUNTING
VIEWPOINT, IT APPEARS THAT THE PROVISIONS MUST BE VIEWED DIFFERENTLY
FROM A LEGAL VIEWPOINT, SINCE THE EFFECT OF INSERTING PRICES OPPOSITE
ITEMS 2 THROUGH 5 WOULD OBLIGATE THE CONTRACTOR TO FURNISH THE DATA AT
THE LISTED PRICES, AND SUCH PRICES COULD THEREFORE BE USED FOR BID
EVALUATION PURPOSES. IF THIS WERE NOT THE CASE ITEMS 2 THROUGH 5 WOULD
BE SURPLUSAGE, MERELY REPEATING THE ESTIMATED PRICES LISTED IN BLOCK 26
WITHOUT ANY OTHER PURPOSE, AND THE PROVISION REQUIRING INSERTION OF DATA
PRICES FOLLOWING ITEM 5 WOULD NOT BE GIVEN ANY MEANING AS A METHOD OF
DENOTING A DIFFERENT USE OF THIS INFORMATION FROM THAT REQUIRED ON DD
FORM 1423. IT IS WELL ESTABLISHED THAT AN INTERPRETATION WHICH GIVES
REASONABLE MEANING TO ALL PARTS OF AN INSTRUMENT WILL BE PREFERRED TO
ONE WHICH LEAVES PORTIONS OF IT SUPERFLUOUS. HOL-GAR MANUFACTURING
CORP. V UNITED STATES, 351 F.2D 972 (1965); 4 WILLISTON CONTRACTS, SEC.
619 AT 731 (3RD ED. 1961). CONSEQUENTLY, WE MUST CONSTRUE THE ABOVE
REFERENCED PROVISIONS (ITEMS 2 THROUGH 5) AS INSERTED FOR PURPOSES OTHER
THAN THOSE REQUIRING THE INSERTION OF PRICES IN DD FORM 1423. THE ONLY
OTHER PURPOSE WHICH CAN REASONABLY BE SEEN UNDER THE CIRCUMSTANCES IS TO
REQUIRE THE BIDDER TO BE LEGALLY OBLIGATED TO FURNISH THE DATA AT FIRM
PRICES WHICH COULD ALSO BE USED FOR BID EVALUATION PURPOSES.'
IN SHORT, THE TWO SETS OF PRICES, INDIVIDUALLY OR COLLECTIVELY, ARE
NOT THE SAME. ONE IS AN ESTIMATE ONLY, IMPOSING NO FIXED COST
OBLIGATION ON THE BIDDER WHILE THE OTHER IS FIXED AND CLEARLY INDICATES
AN OBLIGATION ON THE PART OF THE BIDDER TO FURNISH THE ITEM AT HIS BID
PRICE THEREFOR. BEYOND THIS, BIDDERS WERE ALSO ADVISED BY THE IFB THAT:
"AWARD WILL BE MADE ONLY TO ONE OFFEROR FOR ALL UNITS OF ITEMS 1 AND 2,
4 THRU 7AD, AND FOR ITEM 3 SUBJECT TO EXERCISE OF OPTION FOR ELECTRONIC
REPAIR PARTS. OFFERS, THEREFORE, MUST BE ON THE BASIS OF FURNISHING (I)
ALL UNITS OF ITEMS 1 AND 2, 4 THRU 7AD AND (II) SUBJECT TO EXERCISE OF
OPTION FOR ELECTRONIC REPAIR PARTS, ITEM 3.'
THE OBLIGATION TO FURNISH SUCH ITEMS IS, HOWEVER, CONTINGENT UPON THE
INSERTION OF PRICES IN THE APPROPRIATE PLACES AS EVIDENCED BY THE TERMS
OF THE OFFER CLAUSE FOUND ON THE FACESHEET OF STANDARD FORM 33,
SOLICITATION, OFFER AND AWARD. THE OFFER CLAUSE STATES: "IN COMPLIANCE
WITH THE ABOVE, THE UNDERSIGNED OFFERS AND AGREES, IF THIS OFFER IS
ACCEPTED WITHIN -------- CALENDAR DAYS * * * FROM THE DATE OF RECEIPT OF
OFFERS SPECIFIED ABOVE, TO FURNISH ANY OR ALL ITEMS UPON WHICH PRICES
ARE OFFERED, AT THE PRICE SET OPPOSITE EACH ITEM, DELIVERED AT THE
DESIGNATED POINT/S), WITHIN THE TIME SPECIFIED IN THE SCHEDULE.'
IN VIEW OF THESE PROVISIONS, YOUR FAILURE TO QUOTE A PRICE FOR ITEM 4
RAISES SERIOUS DOUBT THAT YOU WOULD BE OBLIGATED TO FURNISH THE DATA
REQUIRED. SEE B-161576, SUPRA. UNDER THESE CIRCUMSTANCES, IT CANNOT BE
SAID THAT YOUR FAILURE TO INSERT A PRICE FOR ITEM 4 MAY BE WAIVED AS A
MINOR INFORMALITY OR BID IRREGULARITY WITHIN THE PREVIEW OF PARAGRAPH
2-405 OF THE ARMED SERVICES PROCUREMENT REGULATION. THAT REGULATION
PROVIDES IN PERTINENT PART AS FOLLOWS:
"* * * A MINOR INFORMALITY OR IRREGULARITY IS ONE WHICH IS MERELY A
MATTER OF FORM OR IS SOME IMMATERIAL VARIATION FROM THE EXACT
REQUIREMENTS OF THE INVITATION FOR BIDS, HAVING NO EFFECT OR MERELY A
TRIVIAL OR NEGLIGIBLE EFFECT ON PRICE, QUALITY, QUANTITY, OR DELIVERY OF
THE SUPPLIES OR PERFORMANCE OF THE SERVICES BEING PROCURED, AND THE
CORRECTION OR WAIVER OF WHICH WOULD NOT AFFECT THE RELATIVE STANDING OF,
OR BE OTHERWISE PREJUDICIAL TO, BIDDERS. THE CONTRACTING OFFICER SHALL
EITHER GIVE TO THE BIDDER AN OPPORTUNITY TO CURE ANY DEFICIENCY
RESULTING FROM A MINOR INFORMALITY OR IRREGULARITY IN A BID, OR, WAIVE
ANY SUCH DEFICIENCY WHERE IT IS TO THE ADVANTAGE OF THE GOVERNMENT. * *
*"
SINCE WE HOLD THAT THE FAILURE TO INSERT A PRICE FOR ITEM 4
CONSTITUTED A MATERIAL DEVIATION, IT MAY NOT BE WAIVED OR CURED BY
REGARDING THE DD FORM 1423 ESTIMATED TOTAL PRICES AS THE BID PRICE FOR
ITEM 4. SEE 41 COMP. GEN. 412 (1961); B-163756, APRIL 15, 1968;
B-162793, JANUARY 18, 1968. THEREFORE, YOUR BID MAY NOT BE CORRECTED AS
TO ITEM 4 SO AS TO MAKE IT ELIGIBLE FOR CONSIDERATION IN MAKING AN AWARD
UNDER THE IFB. SEE 46 COMP. GEN. 434, 435 (1966).
B-167918, NOV. 5, 1969
OFFICERS AND EMPLOYEES--TRANSFERS--RELOCATION EXPENSES--TRANSPORTATION
FOR HOUSE HUNTING--AUTHORIZATION
EMPLOYEE WHO PERFORMED HOUSE-HUNTING TRIP PRIOR TO DATE EMPLOYMENT
AGREEMENT WAS SIGNED AND TRAVEL AUTHORIZATION WAS ISSUED MAY NOT BE
REIMBURSED EXPENSES INCIDENT THERETO SINCE BUREAU OF BUDGET CIR. NO.
A-56 REQUIRES THAT EMPLOYMENT AGREEMENT MUST BE SIGNED AND TRAVEL MUST
BE OFFICIALLY AUTHORIZED BEFORE HOUSE-HUNTING TRIP IS TAKEN IF EMPLOYEE
IS TO RECEIVE REIMBURSEMENT FOR EXPENSES INCURRED. IN PRESENT CASE
TRAVEL AUTHORIZATION, ISSUED AFTER TRAVEL WAS PERFORMED, DOES NOT
INCLUDE AS REIMBURSABLE ITEM EXPENSE OF ADVANCE HOUSE-HUNTING TRIP AND,
SINCE NOTHING IN RECORD SUGGESTS ADMINISTRATIVE APPROVAL WAS EVER GIVEN,
NO BASIS IS FOUND UPON WHICH TO APPROVE REIMBURSEMENT OF EXPENSES
INCIDENT TO TRIP.
TO MR. VLADIMIR OLEYNIK:
THIS WILL REFER TO THE LETTER OF SEPTEMBER 15, 1969, FROM MR. NEIL
NEWMAN, ACTING CHIEF, ACCOUNTING AND PAYROLL SERVICES, REQUESTING A
DECISION AS TO PAYMENT OF A RECLAIM VOUCHER FOR $37.24 SUBMITTED BY MR.
JOHN J. CHIVENEY FOR EXPENSES INCIDENT TO AN ADVANCE HOUSE HUNTING TRIP
INCURRED IN CONNECTION WITH A PERMANENT CHANGE OF STATION.
THE ORIGINAL VOUCHER AND ATTACHMENTS SHOW THAT ON FEBRUARY 7, 1969,
MR. CHIVENEY SIGNED THE EMPLOYMENT AGREEMENT REQUIRED BY SUBSECTION 1.3C
OF BUREAU OF THE BUDGET CIRCULAR NO. A-56, AS REVISED OCTOBER 12, 1966,
FOR ENTITLEMENT TO RELOCATION ALLOWANCES INCIDENT TO PERMANENT CHANGE OF
STATION AS PROVIDED BY 5 U.S.C. 5724 AND 5 U.S.C. 5724A. ON FEBRUARY
12, 1969, A TRAVEL AUTHORIZATION WAS ISSUED FOR MR. CHIVENEY'S TRANSFER
FROM BOSTON, MASSACHUSETTS, TO HARTFORD, CONNECTICUT. YOUR DOUBT
CONCERNING MR. CHIVENEY'S ENTITLEMENT TO REIMBURSEMENT FOR THE ADVANCE
HOUSE HUNTING TRIP ARISES FROM THE FACT THAT THE TRAVEL IN QUESTION WAS
PERFORMED ON JANUARY 25 AND 26, 1969, PRIOR TO THE DATES THE EMPLOYEE
SIGNED THE EMPLOYMENT AGREEMENT AND A TRAVEL AUTHORIZATION WAS ISSUED.
SUBSECTION 2.4C (3) OF BUREAU OF THE BUDGET CIRCULAR NO. A-56, TO
WHICH YOUR LETTER REFERS, PROVIDES, IN PERTINENT PART, AS FOLLOWS:
"C. PROCEDURAL REQUIREMENTS.
"/1) A TRIP FOR FINDING RESIDENCE QUARTERS WILL NOT BE PERMITTED AT
GOVERNMENT EXPENSE UNTIL AFTER AN EMPLOYEE HAS AGREED TO THE TRANSFER
AND THE DATE OF THE TRANSFER HAS BEEN ESTABLISHED, AND SHALL NOT BE
AUTHORIZED UNDER CIRCUMSTANCES WHERE A PURPOSE OF THE TRIP IS TO PERMIT
THE EMPLOYEE TO DECIDE WHETHER HE WILL ACCEPT THE TRANSFER. * * *
"/3) A PERMANENT CHANGE OF STATION TRAVEL ORDER SHOULD BE ISSUED
WHICH INCLUDES AUTHORIZATION FOR THE ADVANCE ROUND TRIP, MODE OF
TRANSPORTATION AND PERIOD OF TIME ALLOWED FOR THE TRIP. THE TRIP SHALL
NOT BE MADE AT GOVERNMENT EXPENSE UNLESS THE TRAVEL ORDER INCLUDES THE
DUTY REPORTING DATE AT THE NEW OFFICIAL STATION AND INDICATES THAT THE
EMPLOYEE HAS SIGNED THE REQUIRED AGREEMENT.
* * *"
DECISIONS OF THIS OFFICE HAVE INTERPRETED THESE PROVISIONS OF BUREAU
OF THE BUDGET CIRCULAR NO. A-56 AS REQUIRING, WITH RESPECT TO ADVANCE
HOUSE HUNTING TRIPS TAKEN SINCE ISSUANCE OF THE CIRCULAR ON OCTOBER 12,
1966, THAT AN EMPLOYMENT AGREEMENT MUST BE SIGNED AND THE TRAVEL IN
QUESTION MUST BE OFFICIALLY AUTHORIZED BEFORE THE HOUSE HUNTING TRIP IS
TAKEN IF THE EMPLOYEE IS TO RECEIVE REIMBURSEMENT FOR EXPENSES INCURRED.
B-162955, JANUARY 17, 1968; B-163516, MARCH 5, 1968; B-166977, JUNE
18, 1969.
IN THIS CASE, THE TRAVEL AUTHORIZATION, IN ADDITION TO HAVING BEEN
ISSUED AFTER TRAVEL WAS PERFORMED, DOES NOT INCLUDE, AMONG REIMBURSABLE
ITEMS AUTHORIZED, THE EXPENSE OF AN ADVANCE HOUSE HUNTING TRIP. NOTHING
IN THE RECORD SUGGESTS THAT ADMINISTRATIVE APPROVAL WAS EVER GIVEN TO
THE TRAVEL PERFORMED ON JANUARY 25 AND JANUARY 26, FORMALLY OR
INFORMALLY, BEFORE OR AFTER THE TRAVEL OCCURRED.
ACCORDINGLY, WE FIND NO BASIS UPON WHICH TO APPROVE CERTIFICATION OF
THE RECLAIM VOUCHER REPRESENTING A RECLAIM OF EXPENSES INCIDENT TO AN
ADVANCE HOUSE HUNTING TRIP.
THE PAPERS SUBMITTED HERE--- AND WHICH DID NOT INCLUDE THE RECLAIM
VOUCHER FOR $37.24--- ARE RETURNED.
B-168008, NOV. 5, 1969
QUARTERS ALLOWANCE--DEPENDENTS--PROOF OF DEPENDENCY--AFTER SEPARATION
FROM SERVICE
IN ORDER TO RECEIVE CREDIT FOR BASIC ALLOWANCE FOR QUARTERS AS MEMBER
WITH DEPENDENTS, BACHELOR OFFICER WHO ACQUIRES DEPENDENT WIFE BY LEGAL
MARRIAGE MUST EXECUTE DEPENDENCY CERTIFICATE WHICH MUST BE APPROVED BY
DISBURSING OFFICER AND MEMBER OF NAVY CATHOLIC CHAPLAIN CORPS WHO CHOSE
FOR PERSONAL REASONS NOT TO CLAIM WIFE AS DEPENDENT AND GOVERNMENT'S
ACTIONS WERE BASED ON BELIEF THAT MEMBER RETAINED BACHELOR STATUS IS
DENIED CLAIM FOR ADDITIONAL BASIC QUARTERS ALLOWANCE FOR DEPENDENT WIFE
FILED AFTER SEPARATION FROM SERVICE SINCE CLAIM IS BASED ON
CONTRADICTORY FACTS TOO DOUBTFUL FOR ALLOWANCE AND WHERE DOUBT EXISTS IT
IS DUTY OF ACCOUNTING OFFICERS TO DISALLOW CLAIM AND LEAVE CLAIMANT TO
HIS REMEDY IN COURTS.
TO MR. CASIMIR A. DERENGOWSKI:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED SEPTEMBER 14, 1969, IN
EFFECT REQUESTING REVIEW OF SETTLEMENT OF OUR CLAIMS DIVISION DATED
AUGUST 7, 1969, WHICH DISALLOWED YOUR CLAIM FOR THE DIFFERENCE BETWEEN
BASIC ALLOWANCE FOR QUARTERS AS AN OFFICER OF THE NAVY WITH DEPENDENTS
AND THAT RECEIVED AS AN OFFICER WITHOUT DEPENDENTS FROM NOVEMBER 23,
1966, THROUGH SEPTEMBER 23, 1968, AND FOR 47 DAYS UNUSED ACCRUED LEAVE.
THE RECORDS SHOW THAT DURING THE PERIOD OF YOUR CLAIM YOU SERVED IN
THE UNITED STATES NAVY AS A MEMBER OF THE CATHOLIC CHAPLAIN CORPS AS
LIEUTENANT AND LIEUTENANT COMMANDER; THAT YOU MARRIED ELIZABETH
KATHERINE LUNDY ON NOVEMBER 23, 1966; AND THAT YOU RESIGNED YOUR
COMMISSION ON SEPTEMBER 23, 1968. YOU WERE CREDITED WITH BASIC
ALLOWANCE FOR QUARTERS AS A MEMBER WITHOUT DEPENDENTS FOR THE PERIOD
NOVEMBER 23, 1966, THROUGH JANUARY 6, 1967, AND DECEMBER 15, 1967,
THROUGH SEPTEMBER 23, 1968, AND FOR 47 DAYS UNUSED ACCRUED LEAVE. YOU
WERE ASSIGNED BACHELOR OFFICER QUARTERS AT MIDWAY ISLAND FROM JANUARY 7,
1967, TO DECEMBER 13, 1967, AND YOU RECEIVED NO CREDIT FOR BASIC
ALLOWANCE FOR QUARTERS DURING THAT PERIOD.
IN SUPPORT OF YOUR CLAIM DATED SEPTEMBER 25, 1968, YOU SUBMITTED A
DEPENDENCY CERTIFICATE, NAVCOMPT FORM 2040, ALSO DATED SEPTEMBER 25,
1968, TOGETHER WITH A PHOTO COPY OF YOUR MARRIAGE CERTIFICATE,
CERTIFYING THAT YOUR WIFE, KATHERINE E. DERENGOWSKI, WAS YOUR DEPENDENT
FROM THE DATE OF YOUR MARRIAGE ON NOVEMBER 23, 1966, TO THE DATE OF YOUR
RESIGNATION. YOU STATED THAT YOUR STATUS WAS NOT CHANGED IN YOUR
SERVICE RECORD FROM SINGLE TO MARRIED "DUE TO RELUCTANCE OF CHURCH OF
CONTRACTING PARTIES TO RECOGNIZE LICEITY OF CONTRACT" AND THAT "CERTAIN
CONDITIONS, SINCE ELAPSED, PREVENTING (PREVENTED) ME FROM SUBMITTING
THIS CLAIM EARLIER.' YOUR CLAIM WAS DISALLOWED FOR THE REASON THAT THERE
IS NO AUTHORITY FOR FAVORABLE CONSIDERATION OF YOUR CLAIM FOR BASIC
ALLOWANCE FOR QUARTERS FILED SUBSEQUENT TO YOUR SEPARATION FROM THE
SERVICE.
SECTION 405, TITLE 37, U.S. CODE, PROVIDES, WITH CERTAIN EXCEPTIONS
NOT MATERIAL HERE, THAT A MEMBER OF THE UNIFORMED SERVICE WHO IS
ENTITLED TO BASIC PAY IS ENTITLED TO BASIC ALLOWANCE FOR QUARTERS AT THE
MONTHLY RATES THERE SET FORTH ACCORDING TO THE PAY GRADE TO WHICH HE IS
ASSIGNED OR DISTRIBUTED FOR BASIC PAY PURPOSES. HOWEVER, NO ENTITLEMENT
ARISES IF A MEMBER IS ASSIGNED QUARTERS ADEQUATE FOR HIMSELF AND HIS
DEPENDENTS, IF WITH DEPENDENTS. SUBSECTION (G) OF THAT SECTION
AUTHORIZES THE PRESIDENT TO PRESCRIBE REGULATIONS FOR THE ADMINISTRATION
OF THE SECTION. EXECUTIVE ORDER NO. 11157, JUNE 22, 1964, AS AMENDED,
PROVIDES IN SECTION 407 THAT THE SECRETARY CONCERNED, WITH RESPECT TO
PERSONNEL OF THE UNIFORMED SERVICES WITHIN HIS DEPARTMENT, IS AUTHORIZED
TO PRESCRIBE SUCH SUPPLEMENTARY REGULATIONS NOT INCONSISTENT WITH THAT
ORDER AS HE DEEMS NECESSARY OR DESIRABLE FOR CARRYING OUT THE
PRESIDENT'S REGULATIONS.
FOOTNOTE 2 TO TABLE 3-2-8, DEPARTMENT OF DEFENSE MILITARY PAY AND
ALLOWANCE ENTITLEMENTS MANUAL, PROVIDES THAT THE NAVY CONSIDERS THAT
BASIC ALLOWANCE FOR QUARTERS IS FOR CURRENT SUPPORT AND THAT FAVORABLE
CONSIDERATION WILL NOT BE GIVEN TO CLAIMS FILED AFTER SEPARATION.
PAYMENT OF BASIC ALLOWANCE FOR QUARTERS ON ACCOUNT OF A WIFE IS NOT
ACCOMPLISHED WITHOUT SOME ACTION ON AN OFFICER'S PART. IF A BACHELOR
NAVAL OFFICER ACQUIRES A DEPENDENT WIFE BY A LEGAL MARRIAGE, HE IS
REQUIRED TO CONTEMPORANEOUSLY EXECUTE A DEPENDENCY CERTIFICATE WHICH
MUST BE APPROVED BY THE DISBURSING OFFICER IN ORDER TO RECEIVE CREDIT
FOR BASIC ALLOWANCE FOR QUARTERS AS A MEMBER WITH DEPENDENTS. SUCH
ACTION IS NECESSARY IN ORDER THAT A CURRENT DETERMINATION MAY BE MADE AS
TO THE AVAILABILITY AND ASSIGNMENT OF ADEQUATE QUARTERS FOR THE MEMBER
AND HIS DEPENDENTS. SUCH NEW DEPENDENCY STATUS ALSO MAY INFLUENCE THE
MEMBER'S FUTURE MILITARY ASSIGNMENTS. THE CONCEALMENT OF YOUR MARRIAGE
PREVENTED THE APPROPRIATE NAVY OFFICIALS FROM CONSIDERING THESE MATTERS.
WHERE, AS IN YOUR CASE, YOU CHOSE FOR PERSONAL REASONS, NOT TO CLAIM
YOUR WIFE AS A DEPENDENT AND THE GOVERNMENT'S ACTIONS WERE BASED ON THE
BELIEF THAT YOU RETAINED YOUR BACHELOR STATUS, A CLAIM BASED ON
CONTRADICTORY FACTS IS TOO DOUBTFUL FOR ALLOWANCE.
WHEN A CASE ARISES WITH RESPECT TO WHICH THERE IS NO CONTROLLING
JUDICIAL PRECEDENT AND AS TO WHICH SUBSTANTIAL DOUBT EXISTS AS TO THE
ACTION A COURT OF COMPETENT JURISDICTION MIGHT TAKE, IT IS REGARDED AS
THE DUTY OF THE ACCOUNTING OFFICERS TO DISALLOW THE CLAIM AND LEAVE THE
CLAIMANT TO HIS REMEDY IN THE COURTS. SEE LONGWILL V UNITED STATES, 17
CT. CL. 288, 291 (1881) AND CHARLES V UNITED STATES, 19 CT. CL. 316, 319
(1884).
B-168088, NOV. 5, 1969
TRANSPORTATION--HOUSEHOLD EFFECTS--COMMUTATION--SYSTEM OF APPROXIMATION
SETTLEMENT OF AUG. 27, 1969 DISALLOWING ACTUAL COST OF SHIPMENT OF
HOUSEHOLD GOODS INCIDENT TO EMPLOYEE'S TRANSFER FROM LONG ISLAND TO NEW
JERSEY IS SUSTAINED SINCE TRANSPORTATION OF HOUSEHOLD GOODS WAS NOT
AUTHORIZED ON ACTUAL EXPENSE BASIS AND REIMBURSEMENT IS LIMITED TO
AMOUNT ALLOWABLE UNDER COMMUTED RATE SYSTEM, WHICH IS SYSTEM OF
APPROXIMATION WHICH, DEPENDENT ON VARIABLES OF EACH SHIPMENT WILL
SOMETIMES BE FAVORABLE TO EMPLOYEES AND UNDER OTHER CONDITIONS OPERATE
SOMEWHAT TO HIS DISADVANTAGE.
TO MR. ABRAHAM ARNOLD:
YOUR LETTER OF SEPTEMBER 23, 1969, REQUESTS REVIEW OF OUR SETTLEMENT
OF AUGUST 27, 1969, IN WHICH YOU WERE ALLOWED $578 REPRESENTING THE
AMOUNT DUE COMPUTED UNDER THE COMMUTED RATE SYSTEM FOR THE
TRANSPORTATION OF YOUR HOUSEHOLD GOODS FROM PATCHOGUE, LONG ISLAND,
SUFFOLK COUNTY, NEW YORK, TO EATONTOWN, MONMOUTH COUNTY, NEW JERSEY, IN
AUGUST 1967 INCIDENT TO THE TRANSFER OF YOUR OFFICIAL STATION TO FORT
MONMOUTH, NEW JERSEY.
YOU ASK THAT YOU BE ALLOWED PAYMENT OF $296, THE DIFFERENCE BETWEEN
THE COSTS ALLOWED ON THE COMMUTED BASIS, $578, AND THE ACTUAL COST OF
THE SHIPMENT OF YOUR HOUSEHOLD GOODS AND EFFECTS, $874.
UNDER 5 U.S.C. 5724 AND THE REGULATIONS ISSUED PURSUANT THERETO,
PAYMENT ON A COMMUTED BASIS IS AN AUTHORIZED METHOD OF REIMBURSING
CIVILIAN EMPLOYEES FOR THE COST OF TRANSPORTATION OF THEIR HOUSEHOLD
EFFECTS INCIDENT TO A TRANSFER WITHIN THE CONTINENTAL UNITED STATES. THE
REGULATIONS IN QUESTION WERE PROMULGATED IN ACCORDANCE WITH AUTHORITY
DELEGATED BY THE PRESIDENT AND HAVE THE FORCE AND EFFECT OF LAW.
IT IS YOUR CONTENTION THAT THE LANGUAGE OF SECTION 6.4C OF THE
REGULATIONS (BUREAU OF THE BUDGET CIRCULAR NO. A-56) WHICH STATES THAT
WHEN THE COMMUTED RATE SYSTEM IS USED "* * * THE GOVERNMENT IS
OBLIGATED TO PAY FOR TRANSPORTATION AND TEMPORARY STORAGE COSTS UNDE
STANDARD COMMERCIAL TARIFFS WITH NO DISCOUNTS * * *" ENTITLES YOU TO
REIMBURSEMENT FOR THE ENTIRE AMOUNT OF EXPENSES INCURRED BY YOU IN YOUR
MOVE, RATHER THAN THE AMOUNT ALLOWED UNDER THE COMMUTED RATE SYSTEM AS
SPECIFIED IN SECTION 6.4A OF THE CIRCULAR.
THAT PART OF THE REGULATIONS QUOTED BY YOU IS CONTAINED IN A
PARAGRAPH ENTITLED "GUIDELINES FOR DECIDING WHETHER TO USE THE COMMUTED
RATE SYSTEM OR THE ACTUAL EXPENSE METHOD.' THE END OF SUCH PARAGRAPH
CLEARLY INDICATES THAT THE INFORMATION CONTAINED THEREIN IS FOR THE USE
OF THE ADMINISTRATIVE OFFICE IN DECIDING WHETHER TO AUTHORIZE SHIPMENT
OF HOUSEHOLD EFFECTS ON AN ACTUAL EXPENSE BASIS. MOREOVER, WE
UNDERSTAND THAT THE QUOTATION HERE INVOLVED WAS INTENDED TO REFLECT FOR
INFORMATION PURPOSES THAT THE COMMUTED RATES ARE BASED ON COMMERCIAL
TARIFFS WITHOUT DISCOUNTS TO THE GOVERNMENT. AT TIMES WHEN THERE IS
SHIPMENT UNDER A GOVERNMENT BILL OF LADING, THE GOVERNMENT RECEIVES A
DISCOUNT. HOWEVER, WHEN SHIPMENT IS UNDER A COMMERCIAL BILL OF LADING,
THE TARIFFS SUBMITTED UPON WHICH THE COMMUTED RATE SYSTEM IS BASED
CONTAIN NO GOVERNMENT DISCOUNTS.
THE COMMUTED RATE SYSTEM IS A SYSTEM OF APPROXIMATION WHICH,
DEPENDENT UPON THE VARIABLES IN EACH SHIPMENT, WILL SOMETIMES BE
FAVORABLE TO AN EMPLOYEE AND UNDER OTHER CONDITIONS OPERATE SOMEWHAT TO
HIS DISADVANTAGE.
SINCE THE TRANSPORTATION OF YOUR HOUSEHOLD GOODS WAS NOT AUTHORIZED
ON AN ACTUAL EXPENSE BASIS, REIMBURSEMENT FOR THE EXPENSES INCURRED IS
LIMITED TO THAT AMOUNT ALLOWABLE UNDER THE COMMUTED RATE SYSTEM.
THEREFORE, UPON REVIEW, WE FIND NO ERROR IN THE ALLOWANCE MADE IN OUR
OFFICE SETTLEMENT OF AUGUST 27, 1969, AND THAT SETTLEMENT MUST BE
SUSTAINED.
B-168159, NOV. 5, 1969
POST OFFICE DEPARTMENT--LEASES--TAX ESCALATION CLAUSE--OPERATION
DIFFICULTY BETWEEN LESSOR AND POST OFFICE DEPT. REGARDING
INTERPRETATION OF LEASE TAX ESCALATION CLAUSE PRESENTS NO BASIS FOR GAO
ACTION, AS LEASE APPARENTLY PROVIDES THAT IF POST OFFICE BUILDING AND
LAND DESIGNATED FOR POST OFFICE USE ARE NOT SEPARATELY ASSESSED BY
TAXING AUTHORITIES TAX ESCALATION CLAUSE WILL NOT BE OPERATIVE; IF POST
OFFICE BUILDING AND LAND DESIGNATED FOR EXCLUSIVE POST OFFICE USE ARE
ASSESSED SEPARATELY, TAX ESCALATION CLAUSE IN LEASE WOULD BECOME
OPERATIVE AND LESSOR WOULD BE ENTITLED TO WHATEVER BENEFITS SUCH CLAUSE
PROVIDES; AND ASSESSING OF PROPERTY INVOLVED APPEARS TO BE SOLELY
WITHIN JURISDICTION OF BOROUGH ASSESSING AUTHORITIES IN ACCORDANCE WITH
NEW JERSEY LAW.
TO MR. JOHN J. BERRY, JR.:
REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 15, 1969, CONCERNING A
PROBLEM WHICH HAS ARISEN IN CONNECTION WITH A LEASE YOUR CLIENT ENTERED
INTO WITH THE POST OFFICE DEPARTMENT ON JUNE 10, 1960.
YOU STATE THAT THE LEASE CONTAINS A TAX ESCALATION CLAUSE READING, IN
PART, AS FOLLOWS (QUOTING FROM YOUR LETTER):
"-THIS TAX ESCALATION CLAUSE SHALL BE OPERATIVE ONLY IF THE POST
OFFICE BUILDING AND LAND DESIGNATED FOR EXCLUSIVE POST OFFICE USE ARE
SEPARATELY ASSESSED BY TAXING AUTHORITIES.-"
YOU ADVISE THAT THERE HAS BEEN CONSIDERABLE DIFFICULTY BETWEEN THE
LESSOR AND THE DEPARTMENT WITH RESPECT TO THE INTERPRETATION OF THE TAX
ESCALATION CLAUSE, AND THAT YOU FIND IT CONSIDERABLY INVOLVED. YOU
REFER TO ARRANGEMENTS VIS-A-VIS THE POST OFFICE DEPARTMENT, THE LESSOR
AND THE ASSESSING AUTHORITIES OF HOPATCONG BOROUGH WHICH HAVE CREATED A
PROBLEM, AS A RESULT OF WHICH MR. PRATT HAS LOST CONSIDERABLE MONEY.
APPARENTLY IT HAS NOT BEEN POSSIBLE FOR YOUR CLIENT TO REACH AGREEMENT
WITH REPRESENTATIVES OF THE POST OFFICE FROM PHILADELPHIA; AND IT HAS
BEEN SUGGESTED THAT YOU CONSULT THE COMPTROLLER GENERAL IN ORDER TO
ARRIVE AT A SOLUTION.
YOU STATE THAT YOUR ANALYSIS OF YOUR CLIENT'S PROBLEM INDICATES THAT
SOME FEDERAL AUTHORITY MUST SEND A REPRESENTATIVE TO HOPATCONG TO AUDIT
AND ANALYZE THE TAX SITUATION WITH RESPECT TO THE RENTAL OF THIS
PROPERTY, IN ORDER THAT AN EQUITABLE SOLUTION MAY BE RESOLVED.
THE QUOTED PORTION OF TAX ESCALATION CLAUSE, AS WE READ IT, APPEARS
TO BE CLEAR AND UNAMBIGUOUS.
IT PROVIDES THAT THE CLAUSE SHALL BE OPERATIVE ONLY IF THE POST
OFFICE BUILDING AND LAND DESIGNATED FOR EXCLUSIVE POST OFFICE USE ARE
SEPARATELY ASSESSED BY TAXING AUTHORITIES. THAT IS TO SAY IF THE POST
OFFICE BUILDING AND LAND DESIGNATED FOR POST OFFICE USE ARE NOT
SEPARATELY ASSESSED BY TAXING AUTHORITIES, THE TAX ESCALATION CLAUSE
WOULD NOT BE OPERATIVE.
MOREOVER, WE HAVE BEEN INFORMALLY ADVISED BY A REPRESENTATIVE OF THE
POST OFFICE DEPARTMENT THAT IF THE BOROUGH OF HOPATCONG SEPARATELY
ASSESSES THE POST OFFICE BUILDING AND LAND DESIGNATED FOR EXCLUSIVE POST
OFFICE USE, THE TAX ESCALATION CLAUSE IN THE LEASE WOULD BECOME
OPERATIVE AND THE LESSOR WOULD BE ENTITLED TO WHATEVER BENEFITS MAY BE
PROVIDED BY SUCH CLAUSE.
WHILE IT IS NOT SPECIFICALLY STATED IN YOUR LETTER, SINCE YOU
INDICATE THAT THE ASSESSING AUTHORITIES OF HOPATCONG BOROUGH HAVE BEEN
INVOLVED IN THE MATTER, WE ASSUME THAT THE PROPERTY LEASED FROM YOUR
CLIENT BY THE POST OFFICE DEPARTMENT FOR EXCLUSIVE POST OFFICE USE IS
NOT SEPARATELY ASSESSED. IF THIS BE THE CASE THERE WOULD BE NO BASIS OR
AUTHORITY FOR DECLARING OPERATIVE THE TAX ESCALATION CLAUSE IN THE
LEASE. MOREOVER, THE ASSESSING OF THE PROPERTY INVOLVED WOULD APPEAR TO
BE A MATTER SOLELY WITHIN THE JURISDICTION OF THE "ASSESSING AUTHORITIES
OF HOPATCONG BOROUGH" IN ACCORDANCE WITH NEW JERSEY LAW.
IN LIGHT OF THE FOREGOING THERE WOULD APPEAR TO BE NO BASIS FOR THIS
OFFICE TO TAKE ANY ACTION IN THE MATTER.
B-168195, NOV. 5, 1969
STATUTES OF LIMITATION--CLAIMS--FAMILY SEPARATION ALLOWANCE
CLAIM OF FORMER MEMBER FOR FAMILY ALLOWANCE INCIDENT TO HIS SERVICE
IN UNITED STATES ARMY FROM JUNE 9 TO JULY 28, 1943 (DATE OF DISCHARGE),
FIRST RECEIVED BY GENERAL ACCOUNTING OFFICE IN 1961 AND SUBSEQUENTLY
DENIED AS FILED TOO LATE TO RECEIVE CONSIDERATION, IS AGAIN DENIED, AS
31 U.S.C. 71A PROVIDES THAT EVERY CLAIM OR DEMAND AGAINST UNITED STATES
COGNIZABLE BY GAO SHALL BE FOREVER BARRED UNLESS SUCH CLAIM IS RECEIVED
IN GAO WITHIN 10 YEARS AFTER ACCRUAL, AND FILING OF CLAIM WITH WAR
DEPARTMENT OR DEPARTMENT OF ARMY WITHIN 10-YEAR PERIOD DOES NOT MEET
REQUIREMENTS OF LAW. SEE 32 COMP. GEN. 267 (1952).
TO MR. MANUEL G. QUINTANILLA:
REFERENCE IS MADE TO LETTER OF APRIL 23, 1969, FROM MR. L. R.
KRUEGER, BEXAR COUNTY VETERANS SERVICE OFFICER, TO THE U.S. ARMY FINANCE
CENTER, INDIANAPOLIS, INDIANA, WRITTEN ON YOUR BEHALF CONCERNING YOUR
CLAIM FOR FAMILY ALLOWANCE INCIDENT TO YOUR SERVICE IN THE ARMY, WHICH
HAS BEEN FORWARDED TO THIS OFFICE FOR REPLY.
IT APPEARS THAT YOU WERE INDUCTED INTO THE ARMY ON JUNE 9, 1943, AND
THAT YOU WERE DISCHARGED ON JULY 28, 1943. YOUR CLAIM DATED NOVEMBER
18, 1960, FOR FAMILY ALLOWANCE DURING YOUR PERIOD OF SERVICE WAS
FORWARDED HERE BY THE ARMY FINANCE CENTER AND WAS RECEIVED IN OUR CLAIMS
DIVISION ON JANUARY 11, 1961. ON JANUARY 23, 1961, YOU WERE ADVISED
THAT THE CLAIM WAS FILED TOO LATE TO RECEIVE CONSIDERATION.
IN RESPONSE TO HIS INQUIRY ON YOUR CLAIM WE ADVISED THE HONORABLE
HENRY S. GONZALEZ, UNITED STATES HOUSE OF REPRESENTATIVES, ON MARCH 14,
1963, THAT SINCE THE CLAIM WAS FIRST RECEIVED IN THE GENERAL ACCOUNTING
OFFICE ON JANUARY 11, 1961, THE ACT OF OCTOBER 9, 1940, 54 STAT. 1061,
BARS ANY CONSIDERATION OF SUCH CLAIM.
INSOFAR AS IS HERE MATERIAL THE 1940 ACT PROVIDES THAT EVERY CLAIM OR
DEMAND AGAINST THE UNITED STATES COGNIZABLE BY THE GENERAL ACCOUNTING
OFFICE SHALL BE FOREVER BARRED UNLESS SUCH CLAIM, BEARING THE SIGNATURE
AND THE ADDRESS OF THE CLAIMANT, OR OF AN AUTHORIZED AGENT OR ATTORNEY,
SHALL BE RECEIVED IN THE GENERAL ACCOUNTING OFFICE WITHIN 10 FULL YEARS
AFTER THE DATE SUCH CLAIM FIRST ACCRUED, AND THAT ANY CLAIM BARRED BY
THAT ACT RECEIVED IN THE GENERAL ACCOUNTING OFFICE SHALL BE RETURNED TO
THE CLAIMANT WITH A COPY OF THAT ACT, AND SUCH ACTION SHALL BE A
COMPLETE RESPONSE WITHOUT FURTHER COMMUNICATION.
WHILE YOU MAY HAVE FILED A CLAIM WITH THE WAR DEPARTMENT OR THE
DEPARTMENT OF THE ARMY WITHIN 10 YEARS FROM THE DATE YOUR CLAIM FIRST
ACCRUED, OR FROM THE DATE OF YOUR DISCHARGE FROM THE ARMY ON JULY 28,
1943, IT WILL BE OBSERVED THAT THE LAW REQUIRES CLAIMS TO BE FILED IN
THE GENERAL ACCOUNTING OFFICE WITHIN THE 10-YEAR PERIOD. THE FILING OF
YOUR CLAIM WITH THE WAR DEPARTMENT OR THE DEPARTMENT OF THE ARMY DOES
NOT MEET THE REQUIREMENTS OF THE LAW. 32 COMP. GEN. 267 (1952). SINCE
YOUR CLAIM WAS NOT RECEIVED IN THE GENERAL ACCOUNTING OFFICE UNTIL
JANUARY 11, 1961, MORE THAN 17 YEARS AFTER YOUR DISCHARGE, NO
CONSIDERATION CAN BE GIVEN SUCH CLAIM.
IN VIEW OF THE EXPRESS PROVISIONS OF THE ACT OF OCTOBER 9, 1940,
PROHIBITING CONSIDERATION OF CLAIMS RECEIVED IN THE GENERAL ACCOUNTING
OFFICE MORE THAN 10 YEARS AFTER ACCRUAL, THERE IS NO FURTHER ACTION THAT
WE MAY TAKE IN THE MATTER.
B-145522, NOV. 4, 1969
TO MISS ANA L. RABILLO:
REFERENCE IS MADE TO YOUR LETTER OF SEPTEMBER 24, 1969, CONCERNING
YOUR CLAIM FOR AMOUNTS BELIEVED BY YOU TO BE DUE YOUR LATE BROTHER,
AGATON L. RABILLO (RAVELLO), INCIDENT TO HIS SERVICE IN THE PHILIPPINE
SCOUTS.
OUR FILE SHOWS THAT YOUR CLAIM FOR UNPAID PAY AND ALLOWANCES WHICH
MAY HAVE BEEN DUE YOUR BROTHER AT THE DATE OF HIS DEATH, JUNE 11, 1942,
WAS THE SUBJECT OF LETTERS FROM OUR CLAIMS DIVISION DATED JUNE 17, 1960,
AND OCTOBER 10, 1960, EACH OF WHICH ADVISED YOU THAT WE ARE WITHOUT
AUTHORITY TO CONSIDER YOUR CLAIM SINCE THE ACT OF OCTOBER 9, 1940, CH.
788, 54 STAT. 1061, 31 U.S.C. 71A, BARS CONSIDERATION OF ALL CLAIMS NOT
RECEIVED IN THE GENERAL ACCOUNTING OFFICE WITHIN 10 FULL YEARS AFTER THE
DATE OF ACCRUAL. AT YOUR REQUEST, YOUR CLAIM WAS RECONSIDERED AND BY
OUR DECISION OF MAY 4, 1961, B-145522, THE DISALLOWANCE OF YOUR CLAIM
WAS SUSTAINED. YOUR CLAIM WAS ALSO THE SUBJECT OF OUR DECISION DATED
AUGUST 24, 1961, B-145522. BOTH DECISIONS ADVISED YOU THAT THE TIME FOR
FILING CLAIM FOR ARREARS OF PAY AND ALLOWANCES DUE IN CONNECTION WITH
THE MILITARY SERVICE OF YOUR BROTHER, HAD EXPIRED SEVERAL YEARS BEFORE
YOUR CLAIM WAS RECEIVED IN OUR OFFICE. SINCE YOUR LETTER CONTAINS NO
FACTS OR INFORMATION NOT HERETOFORE CONSIDERED, IT FURNISHES NO BASIS
FOR ANY CHANGE IN THE ACTION WHICH HAS BEEN TAKEN IN THIS CASE.
AS TO YOUR REQUEST THAT WE EXPEDITE PAYMENTS ON YOUR LATE BROTHER'S
GOVERNMENT INSURANCE POLICY, YOU WERE ADVISED IN OUR LETTER DATED
FEBRUARY 16, 1962, B-145522, THAT DETERMINATIONS OF ENTITLEMENT TO SUCH
INSURANCE BENEFITS IN THE CASE OF A DECEASED SOLDIER IS A MATTER WITHIN
THE EXCLUSIVE JURISDICTION OF THE VETERANS ADMINISTRATION. SHOULD YOU
BELIEVE THAT SUCH INSURANCE WAS IN FORCE AT THE TIME OF YOUR BROTHER'S
DEATH AND THAT YOU ARE ENTITLED TO SUCH INSURANCE PAYMENTS AS A
BENEFICIARY, YOUR INQUIRY CONCERNING THIS MATTER SHOULD INCLUDE YOUR
BROTHER'S ARMY SERIAL NUMBER, VETERANS ADMINISTRATION INSURANCE FILE
NUMBER AND ANY OTHER RELATED INFORMATION IN YOUR POSSESSION, AND SHOULD
BE ADDRESSED TO: DIRECTOR, INSURANCE SERVICE DEPARTMENT OF VETERANS
BENEFITS
VETERANS ADMINISTRATION VERMONT AVENUE AND H STREETS N.W. WASHINGTON
D.C. 20420
B-167110, NOV. 4, 1969
BIDS--DELIVERY PROVISIONS--MISTAKE--CORRECTION
BID WHICH INDICATED JANESVILLE, WISC; AS SHIPPING POINT FOR F.O.B.
ORIGIN ITEMS MAY BE CORRECTED TO SHOW LA PUENTE, CALIF; AS SHIPPING,
INSPECTION AND ACCEPTANCE POINT SINCE BID AS SUBMITTED AND AS CORRECTED
REMAINED LOWEST RESPONSIVE, RESPONSIBLE BID RECEIVED AND NO BASIS IS
FOUND IN RECORD TO DISAGREE WITH AGENCY'S DETERMINATION THAT CLEAR AND
CONVINCING EVIDENCE ESTABLISHED BOTH EXISTENCE OF MISTAKE AND ACTUAL BID
INTENDED. BECAUSE CORRECTION OF MISTAKE IN BID IS AUTHORIZED ONLY WHEN
BID IS RESPONSIVE IN FORM IN WHICH IT IS SUBMITTED LOW BID WAS FULLY
RESPONSIVE TO TERMS OF INVITATION AND WAS ELIGIBLE FOR CORRECTIONS, BID
NOT DEVIATING, TAKING EXCEPTION TO, OR QUALIFYING ANY REQUIREMENTS OF
INVITATION.
TO WACHTEL, WIENER AND ROSS:
WE REFER TO YOUR TELEGRAM OF MAY 29, 1969, AND SUBSEQUENT
CORRESPONDENCE, PROTESTING ON BEHALF OF REPUBLIC ELECTRONICS INDUSTRIES
CORPORATION (REPUBLIC), AGAINST THE AWARD OF A CONTRACT TO GIBBS
MANUFACTURING AND RESEARCH CORPORATION (GIBBS) UNDER INVITATION FOR BIDS
NO. N00017-69-B-1105, ISSUED BY THE NAVAL ORDNANCE SYSTEMS COMMAND.
THE SUBJECT IFB WAS ISSUED ON OCTOBER 4, 1968, AND CONTEMPLATED THE
PROCUREMENT OF ASROC IGNITION SEPARATION ASSEMBLIES, ANCILLARY ITEMS AND
FIRST ARTICLE SAMPLES, ON A TWO-YEAR MULTI-YEAR BASIS, AS WELL AS AN
OPTION FOR INCREASED QUANTITIES. BIDS WERE OPENED ON JANUARY 24, 1969.
IT IS REPORTED THAT THE LOW RESPONSIVE BIDDER WAS DETERMINED TO BE
NON-RESPONSIBLE FOR REASONS NOT PERTINENT HERE. THE SECOND LOW BIDDER
WAS GIBBS AND THE THIRD LOW BIDDER WAS REPUBLIC. IT IS REPORTED THAT
THE DIFFERENCE IN PRICE BETWEEN GIBBS AND REPUBLIC WAS IN EXCESS OF
$75,000.
SECTION B OF THE IFB SCHEDULE ENTITLED "DELIVERIES" STATES IN
PERTINENT PART:
"ITEMS 7, 10, 11, 12, 13 AND 16 -- F.O.B. ORIGIN. BIDS SUBMITTED ON
A BASIS OTHER THAN F.O.B., CARRIER'S EQUIPMENT, WHARF, OR FREIGHT
STATION AT A SPECIFIED CITY OR SHIPPING POINT, AT OR NEAR THE
CONTRACTOR'S PLANT, WILL BE REJECTED AS NONRESPONSIVE. BIDS WILL BE
EVALUATED ON THE BASIS OF THE LOWEST OVERALL COST TO THE GOVERNMENT,
TAKING ACCOUNT OF TRANSPORTATION COSTS TO THE GOVERNMENT FROM THE POINT
OF ORIGIN TO THE DESIGNATED DOMESTIC DESTINATIONS.
"FOR THE PURPOSE OF EVALUATING BIDS AND FOR NO OTHER PURPOSE, THE
FINAL DESTINATIONS FOR THE SUPPLIES WILL BE CONSIDERED TO BE AS FOLLOWS:
"45 PERCENT OF EACH APPLICABLE ITEM -- NAVAL WEAPONS STATION, SEAL
BEACH, CALIFORNIA.'55 PERCENT OF EACH APPLICABLE ITEM -- NAVAL WEAPONS
STATION, YORKTOWN, VIRGINIA.'
SECTION E OF THE SCHEDULE REQUIRED BIDDERS TO INSERT THE LOCATION
WHERE F.O.B. ORIGIN ITEMS WERE TO BE OFFERED FOR INSPECTION AND
ACCEPTANCE BY THE GOVERNMENT. GIBBS SPECIFIED THIS LOCATION IN ITS BID
AS ITS PLANT AT 340 NO. FRANKLIN STREET, JANESVILLE, WISCONSIN. IN
ADDITION, GIBBS INDICATED "TEAM TRACK, JANESVILLE, WISCONSIN," AS ITS
SHIPPING POINT FOR THE F.O.B. ORIGIN ITEMS. HOWEVER, DURING THE
PRE-AWARD SURVEY OF GIBBS IT WAS LEARNED THAT GIBBS WOULD SUBCONTRACT
ALL EXPLOSIVE COMPONENTS TO REYNOLDS ROCKET SYSTEMS OF LA PUENTE,
CALIFORNIA, AND THAT UPON COMPLETION THE SUBCONTRACTOR WOULD SHIP THE
EXPLOSIVES DIRECTLY TO THE GOVERNMENT.
PRIOR TO THE CONTRACTING OFFICER'S RECEIPT OF THE RESULTS OF THE
PRE-AWARD SURVEY, REPUBLIC PROTESTED THE PENDING AWARD TO GIBBS ON THE
BASIS THAT GIBBS WAS NOT A RESPONSIVE BIDDER BECAUSE IT HAD INDICATED
THAT INSPECTION AND ACCEPTANCE WOULD TAKE PLACE AT ITS JANESVILLE,
WISCONSIN, PLANT AND IT DID NOT POSSESS THE CAPABILITY FOR EXPLOSIVE
HANDLING AT THIS PLANT. THE NAVAL ORDNANCE SYSTEMS COMMAND TOOK THE
POSITION, HOWEVER, THAT GIBBS' BID WAS RESPONSIVE ON ITS FACE AND IT
WOULD BE NECESSARY TO COMPLETE THE PRE-AWARD SURVEY IN ORDER TO
DETERMINE MATTERS RELATING TO RESPONSIBILITY.
SUBSEQUENTLY, BY LETTER DATED APRIL 11, 1969, GIBBS ALLEGED THAT IT
HAD MADE A MISTAKE IN BID AND REQUESTED THAT ITS BID BE CORRECTED TO
CHANGE THE POINT OF INSPECTION AND ACCEPTANCE FROM JANESVILLE,
WISCONSIN, TO THE PLANT OF ITS SUBCONTRACTOR IN LA PUENTE, CALIFORNIA.
GIBBS AT THAT TIME FURNISHED THE QUOTATION OF REYNOLDS ROCKET SYSTEM FOR
ACCOMPLISHING THE SUBCONTRACT WORK. THIS QUOTATION WAS DATED JANUARY 8,
1969, WHICH WAS SEVERAL DAYS PRIOR TO THE SUBMISSION OF GIBBS' BID. THE
NAVY REPORTS THAT IT WAS APPARENT FROM THE PRE-AWARD SURVEY AND THE
QUOTATION FROM REYNOLDS THAT GIBBS NEVER INTENDED TO HANDLE THE
EXPLOSIVE COMPONENTS AND THERE WAS NO EVIDENCE TO SUGGEST THAT GIBBS
EVER CONTEMPLATED OR HAD THE SPECIALIZED TECHNICAL CAPABILITY OF LOADING
THE EXPLOSIVE COMPONENTS AT ITS OWN FACILITIES IN WISCONSIN. ACCORDING
TO THE NAVY IT DID NOT APPEAR REASONABLE THAT THE CONTRACTOR WOULD GO TO
THE CONSIDERABLE EXPENSE OF PREPARING A BID BASED UPON A SPECIALIZED
TECHNICAL CAPABILITY IT DID NOT POSSESS, OR THAT, IN THE ALTERNATIVE, IT
WOULD SHIP THE COMPLETED HARDWARE FROM CALIFORNIA BACK TO WISCONSIN
MERELY FOR THE PURPOSE OF FINAL INSPECTION AND ACCEPTANCE WHEN THE SAME
PURPOSE COULD BE SERVED BY PERFORMING THE INSPECTION AND ACCEPTANCE AT
ITS SUBCONTRACTOR'S PLANT IN CALIFORNIA. ACCORDINGLY, ON MAY 16, 1969,
THE DEPUTY COMMANDER, PURCHASING, NAVAL SUPPLY SYSTEMS COMMAND MADE A
DETERMINATION TO CORRECT THE BID PURSUANT TO GIBBS' REQUEST AND ON MAY
23, 1969, AWARD WAS MADE TO GIBBS. IN HIS FINDINGS AND DETERMINATION TO
SUPPORT THE BID CORRECTION, THE DEPUTY COMMANDER STATED: "* * * THE
CONTRACTING OFFICER STATED HIS BELIEF THAT THE EVIDENCE IS CLEAR AND
CONVINCING BOTH AS TO A MISTAKE AND THE INTENDED BID AND HE RECOMMENDED
THAT THE BID BE CORRECTED AND CONSIDERED AS INTENDED.'4. COMPUTATIONS
OF TRANSPORTATION COSTS THAT WOULD BE INCURRED BY THE GOVERNMENT FOR
DELIVERY FOB ORIGIN ITEMS FROM BOTH JANESVILLE, WISCONSIN, AS BID, AND
FROM LAPUENTE, CALIFORNIA, AS INTENDED, TO SEAL BEACH AND YORKTOWN, WERE
PREPARED FOR THE CONTRACTING OFFICER BY THE MILITARY TRAFFIC MANAGEMENT
AND TERMINAL SERVICES, BASED ON THE GUARANTEED SHIPPING WEIGHTS OF THE
TWO BIDDERS. THESE COMPUTATIONS REVEAL THAT CORRECTION OF THE
ACCEPTANCE POINT WOULD RESULT IN AN INCREASE OF $10.50 FOR EACH 600
UNITS AND RELATED ITEMS. THE BIDS SUBMITTED BY GIBBS AND THE NEXT
LOWEST BIDDER, REPUBLIC ELECTRONICS INDUSTRIES, PLUS TRANSPORTATION
COSTS ON THE FOB ORIGIN ITEMS WERE AS FOLLOWS:
"LOT I (FY 1969)
GIBBS $1,060,698 PLUS TRANSPORTATION
$2,350,50 EQUALS $1,063,048.50
REPUBLIC $1,101,079 PLUS TRANSPORTATION
$2,559.00 EQUALS $1,103,638.00
(GIBBS IF CORRECTED: $1,060,698 PLUS
TRANSPORTATION $2,361.00 EQUALS $1,063,059.00)
"LOT II MULTI-YEAR (FY 1969 AND FY 1970)
GIBBS $1,954,999 PLUS TRANSPORTATION
$4,701.00 EQUALS $1,959,700
REPUBLIC $2,040,304 PLUS TRANSPORTATION
$5,118.00 EQUALS $2,045,422
(GIBBS IF CORRECTED: $1,954,999 PLUS
TRANSPORTATION $4,722.00 EQUALS $1,959,721)
"DETERMINATION
"BASED ON THE FOREGOING, IT IS HEREBY DETERMINED THAT THE EVIDENCE IS
CLEAR AND CONVINCING BOTH AS TO THE ERROR AND THE INTENDED BID OF GIBBS
MANUFACTURING AND RESEARCH CORPORATION. CORRECTION OF THE MISTAKE WILL
NOT CHANGE GIBBS' BIDDING POSITION. ITS BID BOTH AS SUBMITTED AND AS
CORRECTED REMAINS THE LOWEST RESPONSIVE, RESPONSIBLE BID RECEIVED.
ACCORDINGLY, THE BID SHALL BE CORRECTED AND CONSIDERED AS INTENDED.'
THE NAVAL ORDNANCE SYSTEMS COMMAND PURSUANT TO ITS INTERPRETATION OF
THE ABOVE FINDINGS AND DETERMINATION CORRECTED GIBBS' BID BY MODIFYING
THE F.O.B. ORIGIN POINT AS WELL AS THE INSPECTION AND FINAL ACCEPTANCE
POINT FOR THE F.O.B. ORIGIN ITEMS FROM JANESVILLE, WISCONSIN TO LA
PUENTE, CALIFORNIA.
THE FACTS AS OUTLINED ABOVE PRESENT TWO QUESTIONS FOR CONSIDERATION:
(1) WAS GIBBS' BID NON-RESPONSIVE FOR FAILING TO INDICATE THE CORRECT
SHIPPING POINT AND THE CORRECT PLACE FOR INSPECTION AND ACCEPTANCE? (2)
WAS THE BID CORRECTION BY THE DEPARTMENT OF THE NAVY AUTHORIZED AND
PROPER? IN THIS LATTER CONNECTION, AN AFFIRMATIVE ANSWER TO THE FIRST
QUESTION WOULD NECESSARILY RESOLVE THE SECOND SINCE THE LAW IS CLEAR
THAT IN CASES OF THE KIND PRESENTED HERE, A CORRECTION OF
MISTAKE IN BID IS AUTHORIZED ONLY WHEN THE BID IS RESPONSIVE IN THE
FORM IN WHICH IT IS SUBMITTED.
40 COMP. GEN. 132, 134; 38 COMP. GEN. 819; B-158889, JUNE 13, 1966.
YOU NOTE THAT IN ORDER TO BE RESPONSIVE A BID MUST ACCORD WITH THE
SPECIFICATIONS AND THE BIDDER MUST AGREE WITHOUT QUALIFICATION TO COMPLY
WITH THEM. YOU CONTEND THAT ON THE TERMS AND CONDITIONS OF THE BID
SUBMITTED BY GIBBS, IT WAS NOT ABLE TO COMPLY WITH THE SPECIFICATION
SAFETY REQUIREMENTS SINCE GIBBS LACKED THE EXPLOSIVE HANDLING CAPABILITY
AT ITS JANESVILLE, WISCONSIN PLANT. THE SPECIFICATIONS CONTEMPLATED,
YOU SAY, THAT THE SHIPPING POINT WOULD BE A LOCATION WHERE THE PLANT WAS
ABLE TO LOAD THE CONTRACT ITEMS WITH THE EXPLOSIVE CHARGE AND THAT
ACCEPTANCE AND INSPECTION WOULD OCCUR AT THIS LOCATION. YOU FURTHER
CONTEND THAT AFTER THE OPENING OF BIDS GIBBS WAS IN A POSITION WHERE IT
COULD "SECOND GUESS OTHER BIDDERS" SINCE IT COULD HAVE ALLOWED ITSELF TO
BE CONSIDERED NONRESPONSIVE OR IT COULD HAVE CLAIMED A MISTAKE AND HAD
THE BID CORRECTED.
IN OUR OPINION, GIBBS' BID WAS FULLY RESPONSIVE TO THE TERMS OF THE
INVITATION FOR BIDS AND WAS, THEREFORE, ELIGIBLE FOR CORRECTION. THE
RESPONSIVENESS OF A BID MUST BE DETERMINED FROM THE CONTENTS OF THE BID
ITSELF AT THE TIME OF OPENING. B-166858, JUNE 19, 1969. GENERALLY, A
BID WILL BE CONSIDERED RESPONSIVE IF, UPON ITS ACCEPTANCE, THE BIDDER
WOULD BE LEGALLY REQUIRED TO PERFORM THE RESULTING CONTRACT IN STRICT
ACCORDANCE WITH ALL THE TERMS AND SPECIFICATIONS OF THE INVITATION FOR
BIDS. 42 COMP. GEN. 502. THE BID SUBMITTED BY GIBBS DID NOT DEVIATE
FROM, TAKE EXCEPTION TO, OR QUALIFY, ANY OF THE TERMS OR REQUIREMENTS OF
THE BID INVITATION. HAD AN AWARD BEEN MADE TO GIBBS ON THE BASIS OF THE
BID AS SUBMITTED GIBBS COULD HAVE PERFORMED THE RESULTING CONTRACT IN
STRICT ACCORDANCE WITH THE SPECIFICATIONS AND TERMS OF THE INVITATION
ALTHOUGH, ADMITTEDLY, ITS COST OF PERFORMANCE WOULD HAVE BEEN INCREASED
BY THE COST OF TRANSPORTING THE LOADED ITEMS FROM ITS LA PUENTE,
CALIFORNIA, SUBCONTRACTOR'S PLANT TO ITS JANESVILLE, WISCONSIN, PLANT
FOR INSPECTION AND ACCEPTANCE. WHILE YOU MAINTAIN THAT THE
SPECIFICATIONS CONTEMPLATED THAT THE SHIPPING POINT AND THE INSPECTION
AND ACCEPTANCE POINT WOULD BE A LOCATION WHERE THE PLANT WAS CAPABLE OF
LOADING THE CONTRACT ITEMS WITH THE EXPLOSIVE CHARGE, IT NEED ONLY BE
NOTED THAT THE SPECIFICATIONS DID NOT REQUIRE THAT THESE POINTS BE
LOCATED AT THE LOADING PLANT. WE HAVE BEEN ADVISED BY THE NAVY,
CONTRARY TO YOUR CONTENTIONS, THAT HAD GIBBS' BID NOT BEEN CORRECTED THE
NAVY WOULD HAVE PERFORMED AN INITIAL INSPECTION OF EXPLOSIVE LOADING AT
THE SUBCONTRACTOR'S PLANT AND THAT THE INSPECTION AND ACCEPTANCE
CONTEMPLATED BY SECTION E OF THE SCHEDULE (I.E.'INSPECTION FOR THE
PURPOSES OF ACCEPTANCE AND ACCEPTANCE") WOULD HAVE BEEN LATER
ACCOMPLISHED AT JANESVILLE, WISCONSIN. NOTHING IN THE BID INVITATION
PROHIBITED SUCH A PROCEDURE.
NOR DO WE SEE ANY MERIT IN YOUR CONTENTION THAT GIBBS WAS IN A
POSITION TO "SECOND GUESS" OTHER BIDDERS AFTER BIDS WERE OPENED. SINCE
GIBBS' BID WAS RESPONSIVE ON ITS FACE AND THE EXPLOSIVE LOADING
CAPABILITY WHICH IT DID NOT HAVE AT ITS WISCONSIN PLANT WAS STRICTLY A
MATTER RELATING TO THE RESPONSIBILITY OF THE BIDDER, IT COULD NOT AVOID
AN AWARD TO IT BY PLEADING THIS LACK OF LOADING CAPABILITY. IF GIBBS
HAD BEEN AWARDED THE CONTRACT ON THE BASIS OF ITS BID AS SUBMITTED, IT
WOULD HAVE BEEN LEGALLY OBLIGATED TO PERFORM THE CONTRACT IN STRICT
ACCORDANCE WITH THE SPECIFICATIONS INCLUDING AN OBLIGATION TO PROVIDE
THE EXPLOSIVE LOADING CAPABILITY IN-HOUSE OR BY CONTRACT. GIBBS'
DESIGNATION OF JANESVILLE, WISCONSIN, AS ITS SHIPPING, INSPECTION AND
ACCEPTANCE POINT IN NO WAY INFRINGED UPON OR QUALIFIED THIS LATTER
OBLIGATION AND GIBBS WAS NOT THEREBY PLACED IN A POSITION TO VALIDLY
DECLINE AN AWARD ON THE BASIS THAT ITS BID DID NOT CONFORM TO THE
INVITATION FOR BIDS.
PARAGRAPH 2-406.3 (A) (3) OF THE ARMED SERVICES PROCUREMENT
REGULATION PROVIDES THAT:
"/A) THE DEPARTMENTS ARE AUTHORIZED TO MAKE THE FOLLOWING
ADMINISTRATIVE DETERMINATIONS IN CONNECTION WITH MISTAKES IN BIDS, OTHER
THAN APPARENT CLERICAL MISTAKES, ALLEGED AFTER OPENING OF BIDS AND PRIOR
TO AWARD.
"/3) WHERE THE BIDDER REQUESTS PERMISSION TO CORRECT A MISTAKE IN HIS
BID AND CLEAR AND CONVINCING EVIDENCE ESTABLISHES BOTH THE EXISTENCE OF
A MISTAKE AND THE BID ACTUALLY INTENDED, A DETERMINATION PERMITTING THE
BIDDER TO CORRECT THE MISTAKE MAY BE MADE; PROVIDED THAT, IN THE EVENT
SUCH CORRECTION WOULD RESULT IN DISPLACING ONE OR MORE LOWER BIDS, THE
DETERMINATION SHALL NOT BE MADE UNLESS THE EXISTENCE OF THE MISTAKE AND
THE BID ACTUALLY INTENDED ARE ASCERTAINABLE SUBSTANTIALLY FROM THE
INVITATION AND THE BID ITSELF. IF THE EVIDENCE IS CLEAR AND CONVINCING
ONLY AS TO THE MISTAKE, BUT NOT AS TO THE INTENDED BID, A DETERMINATION
PERMITTING THE BIDDER TO WITHDRAW HIS BID MAY BE MADE.'
WHILE YOU CONTEND THAT THE ABOVE PROVISIONS OF ASPR DID NOT AUTHORIZE
THE CORRECTION HERE INVOLVED BECAUSE THE EXISTENCE OF THE MISTAKE WAS
"NOT ASCERTAINABLE SUBSTANTIALLY FROM THE INVITATION AND THE BID ITSELF"
, IT IS CLEAR THAT THIS "ASCERTAINABILITY" REQUIREMENT APPLIES ONLY IF
THE CORRECTION WOULD RESULT IN DISPLACING ONE OR MORE LOWER BIDS. AS
INDICATED IN THE RECORD THE CORRECTION OF THE MISTAKE DID NOT CHANGE
GIBBS' BIDDING POSITION. ITS BID BOTH AS SUBMITTED AND CORRECTED
REMAINED THE LOWEST RESPONSIVE, RESPONSIBLE BID RECEIVED. MOREOVER, WE
FIND NO BASIS IN THE RECORD TO DISAGREE WITH THE NAVY DEPARTMENT'S
DETERMINATION THAT THE EVIDENCE WAS CLEAR AND CONVINCING TO ESTABLISH
BOTH THE EXISTENCE OF THE MISTAKE AND THE BID ACTUALLY INTENDED. WE
MUST THEREFORE CONCLUDE THAT CORRECTION OF GIBBS' BID WAS LEGALLY
AUTHORIZED AND PROPER.
IN VIEW OF THE FOREGOING, WE FIND NO VALID REASON TO DISTURB THE
AWARD TO GIBBS AND YOUR PROTEST IS DENIED.
B-167787, NOV. 4, 1969
BONDS--BID--VARIANCE FROM REQUIREMENTS--SURETIES
INASMUCH AS INVITATION REQUIREMENT FOR SUBMISSION OF BID BOND
EXECUTED BY TWO INDIVIDUALS, TOGETHER WITH AFFIDAVIT OF FINANCIAL
STATUS, IS MATERIAL PART OF INVITATION WHICH CANNOT BE WAIVED BY
CONTRACTING OFFICER, NONCOMPLIANCE REQUIRING BID REJECTION AS
NONRESPONSIVE, BID BOND EXECUTED BY TWO SURETIES WITH AFFIDAVIT
SUBMITTED ONE WEEK AFTER BID OPENING REQUIRED REJECTION OF LOW BID AS
NONRESPONSIVE EVEN THOUGH SUCH FAILURE WAS DUE TO INADVERTENCE, MISTAKE
OR OTHERWISE OR MONETARY SAVINGS MIGHT ACCRUE TO GOVERNMENT BY
CONSIDERATION OF SUBSTITUTE BOND SINCE IT IS INFINITELY MORE IN PUBLIC
INTEREST TO MAINTAIN ESTABLISHED PRINCIPLES OF FORMAL COMPETITIVE
PROCUREMENT THAN FOR GOVT. TO OBTAIN PECUNIARY ADVANTAGE THROUGH
VIOLATION OF RULES.
TO BRUCE K. REDDING, INC.:
REFERENCE IS MADE TO A TELEGRAM DATED AUGUST 25, 1969, AND SUBSEQUENT
CORRESPONDENCE CONCERNING YOUR PROTEST AGAINST THE REJECTION BY THE
GENERAL SERVICES ADMINISTRATION (GSA) OF YOUR LOW BID ON GSA PROJECT NO.
36287, CONSTRUCTION OF THE FOOD AND DRUG ADMINISTRATION'S DISTRICT
OFFICE AND LABORATORY IN PHILADELPHIA, PENNSYLVANIA. AFTER BIDS WERE
OPENED ON AUGUST 14, PURSUANT TO INVITATION FOR BIDS ISSUED ON JULY 7,
1969, THE CONTRACTING OFFICER NOTED THAT YOU HAD FURNISHED A BID BOND
EXECUTED BY ONLY A SINGLE INDIVIDUAL AS SURETY, AND HE THEREFORE
DETERMINED THAT YOUR BID WAS NONRESPONSIVE TO THE REQUIREMENTS STATED IN
INSTRUCTION NO. 4 (B), WHICH WAS SET FORTH ON THE REVERSE SIDE OF THE
BOND, STANDARD FORM (SF) 24, AS FOLLOWS:
"/B) WHERE INDIVIDUAL SURETIES EXECUTE THE BOND, THEY SHALL BE TWO OR
MORE RESPONSIBLE PERSONS.
A COMPLETED AFFIDAVIT OF INDIVIDUAL SURETY (STANDARD FORM 28), FOR
EACH INDIVIDUAL SURETY, SHALL ACCOMPANY THE BOND. SUCH SURETIES MAY BE
REQUIRED TO FURNISH ADDITIONAL SUBSTANTIATING INFORMATION CONCERNING
THEIR ASSETS AND FINANCIAL CAPABILITY AS THE GOVERNMENT MAY REQUIRE.'
ADDITIONALLY, YOUR BID BOND WAS NOT ACCOMPANIED BY THE REQUIRED
AFFIDAVIT OF INDIVIDUAL SURETY (SF 28). SUCH OMISSION MADE IT
IMPOSSIBLE FOR THE CONTRACTING OFFICER TO DETERMINE THE FINANCIAL
ACCEPTABILITY OF THIS INDIVIDUAL SURETY AS REQUIRED BY FEDERAL
PROCUREMENT REGULATION (FPR) 1-10.203 (A).
BY LETTER OF AUGUST 19, 1969, THE CONTRACTING OFFICER NOTIFIED YOU OF
THE REJECTION OF YOUR BID BECAUSE OF THE ABOVE DEFICIENCY. ON AUGUST
22, 1969, YOU SUBMITTED ANOTHER BID BOND TO THE CONTRACTING OFFICER
WHICH WAS EXECUTED BY TWO INDIVIDUAL SURETIES, TOGETHER WITH AN
AFFIDAVIT, AND STATED THAT YOU HAD NOT BEEN FURNISHED WITH COPIES OF SF
28. THIS AFFIDAVIT, DATED AUGUST 12, 1969, FAILED TO LIST ANY SUCH
INFORMATION AS IS REQUIRED TO BE SET FORTH ON SF 28 CONCERNING THE
FINANCIAL STATUS OF THE INDIVIDUAL SURETIES. ON AUGUST 26, 1969, YOU
WERE FORMALLY ADVISED BY GSA THAT THESE DOCUMENTS COULD NOT BE ACCEPTED
SINCE CONSIDERATION OF SUCH INFORMATION AFTER BID OPENING WOULD BE
TANTAMOUNT TO ALLOWING YOU THE PRIVILEGE OF DECIDING WHETHER OR NOT TO
"STAND BY YOUR BID.' IN VIEW THEREOF, GSA CONSIDERS YOUR BID
NONRESPONSIVE IN ACCORDANCE WITH THE FOLLOWING FPR REGULATIONS: "SEC.
1-2.404-2 (F) WHERE A BID GUARANTEE IS REQUIRED AND A BIDDER FAILS TO
FURNISH IT IN ACCORDANCE WITH THE REQUIREMENTS OF THE INVITATION FOR
BIDS, THE BID SHALL BE REJECTED EXCEPT AS OTHERWISE PROVIDED IN SEC.
1-10.103-4.'"SEC. 1-10.103-4 FAILURE TO SUBMIT PROPER BID GUARANTEE.
WHERE AN INVITATION FOR BIDS REQUIRES THAT A BID BE SUPPORTED BY A
BID GUARANTEE AND NONCOMPLIANCE OCCURS, THE BID SHALL BE REJECTED,
EXCEPT IN THE FOLLOWING SITUATIONS WHEN THE NONCOMPLIANCE SHALL BE
WAIVED UNLESS THERE ARE COMPELLING REASONS CONTRARY:
(A) WHERE ONLY A SINGLE BID IS RECEIVED. IN SUCH CASES HOWEVER, THE
GOVERNMENT MAY OR MAY NOT REQUIRE THE FURNISHING OF THE BID GUARANTEE
BEFORE AWARD.
(B) WHERE THE AMOUNT OF THE BID GUARANTEE SUBMITTED, THOUGH LESS THAN
THE AMOUNT REQUIRED BY THE INVITATION FOR BIDS, IS EQUAL TO OR GREATER
THAN THE DIFFERENCE BETWEEN THE PRICE STATED IN THE BID AND THE PRICE
STATED IN THE NEXT HIGHER ACCEPTABLE BID.
(C) WHERE THE BID GUARANTEE IS RECEIVED LATE AND THE LATE RECEIPT MAY
BE WAIVED UNDER THE RULES ESTABLISHED IN SEC. 1-2.303 FOR CONSIDERATION
OF LATE BIDS.
(D) WHERE A BID GUARANTEE CEASES TO MEET THE REQUIREMENTS OF
PARAGRAPH (B) OF THIS SEC. 1-10.103-4 AS A RESULT OF THE CORRECTION OF
A MISTAKE IN BID UNDER SEC. 1-2.406.'
YOU HAVE ADVANCED SEVERAL ARGUMENTS TO PERMIT CONSIDERATION OF YOUR
BID WHICH ARE SUMMARIZED AS FOLLOWS: (1) A PROPERLY EXECUTED BID BOND,
WHICH CONFORMED IN ALL RESPECTS WITH THE INSTRUCTIONS CONTAINED ON SF
24, WAS PREPARED, BUT THROUGH AN OVERSIGHT THIS BOND WAS NOT FORWARDED
WITH YOUR BID; (2) THE DEFECT IN YOUR BOND WAS OF TRIVIAL IMPORTANCE
COMPARED TO THE MONETARY SAVINGS WHICH THE GOVERNMENT COULD ACHIEVE BY
WAIVING SUCH DEFECT AND ALLOWING CONSIDERATION OF THE BOND YOU SUBMITTED
AFTER BID OPENING; (3) AT BID OPENING THE CONTRACTING OFFICER ANNOUNCED
THAT YOUR CONCERN WAS THE LOW BIDDER ELIGIBLE FOR AWARD AND THEREFORE
WAIVED ANY DEFECT IN YOUR OFFER.
PRIOR TO 1958 IT WAS HELD IN A NUMBER OF CASES THAT THE REQUIREMENT
FOR A BID BOND IN ADVERTISED PROCUREMENTS MIGHT BE WAIVED IF THE
CONTRACTING OFFICER DETERMINED IT TO BE IN THE INTEREST OF THE
GOVERNMENT TO DO SO. 7 COMP. GEN. 568 (1928); 16 ID. 493 (1936); ID.
809 (1936); 26 ID. 49 (1946).
IN 1958, HOWEVER, A CASE AROSE INVOLVING A BID INVITATION FORM WHICH
WAS MORE EMPHATICALLY WORDED THAN USUAL IN THAT IT STATED THAT A BID
BOND MUST BE FURNISHED WITH THE BID, AND THAT LATE BID BONDS WILL NOT BE
ACCEPTED BUT WILL BE REJECTED AS NONRESPONSIVE. RELYING UPON THE
LITERAL LANGUAGE OF THESE PROVISIONS, THE CONTRACTING OFFICER REJECTED A
LOW BID FOR WHICH THE BID BOND HAD NOT BEEN SUBMITTED UNTIL 28 MINUTES
AFTER THE SCHEDULED TIME FOR BID OPENING. THE LOW BIDDER PROTESTED,
RELYING UPON PREVIOUS HOLDINGS THAT THE LATE SUBMISSION OF THE BOND WAS
AN INFORMALITY WHICH SHOULD HAVE BEEN WAIVED. WE AGREED WITH THE
CONTRACTING OFFICER IN 38 COMP. GEN. 532 (1959), AND OVERRULED OUR PRIOR
DECISIONS PERMITTING WAIVER OF BID BOND REQUIREMENTS. THE NEW RULE
ESTABLISHED BY THIS DECISION WAS THAT WHERE A BID BOND IS REQUIRED BY
THE TERMS OF AN INVITATION, THE REQUIREMENT IS TO BE REGARDED AS A
MATERIAL PART OF THE INVITATION, NONCOMPLIANCE WITH WHICH WILL RENDER A
BID NONRESPONSIVE AND REQUIRE ITS REJECTION. THREE BASES WERE STATED IN
SUPPORT OF THE NEW RULE:
1. IT IS A PROPER FUNCTION OF ADMINISTRATIVE AGENCIES TO IMPOSE UPON
BIDDERS ANY REASONABLE CONDITION RELATING TO ELIGIBILITY FOR AWARD;
2. THE EFFECT OF THE OLD RULE ALLOWING WAIVER OF A BID GUARANTEE
DEFICIENCY COMPROMISED THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM
BY MAKING IT POSSIBLE FOR BIDDERS TO ELECT AFTER OPENING OF BIDS WHETHER
OR NOT THEY WOULD MAKE THEMSELVES ELIGIBLE FOR AWARD BY FURNISHING A
BOND, OR PREVENTING AWARD BY FAILING TO DO SO.
3. THE PROCESS OF WEIGHING EVIDENCE TO DETERMINE WHETHER UNDER THE
OLD RULE A GUARANTEE DEFICIENCY SHOULD BE WAIVED COULD RESULT IN
INCONSISTENT TREATMENT OF BIDDERS.
THIS RULE WAS SUBSTANTIALLY ADOPTED BY GSA IN PROMULGATING FPR
1-10.103-4, QUOTED ABOVE, WHICH REQUIRES THE REJECTION OF ANY BID NOT
SUPPORTED BY A BID BOND IN FULL COMPLIANCE WITH THE REQUIREMENTS OF THE
IFB, EXCEPT FOR THE FOUR SITUATIONS LISTED THEREIN WHICH ARE NOT
PERTINENT TO THE SUBJECT CASE. WHILE WE HAVE HELD THAT A PURELY FORMAL
DEVIATION FROM THE INSTRUCTIONS ON THE REVERSE SIDE OF SF 24 DOES NOT
AUTOMATICALLY REQUIRE BID REJECTION (B-152589, OCTOBER 18, 1963), THE
DEVIATION MAY NOT BE OF SUCH A KIND AS WOULD RESULT IN THE GOVERNMENT
OBTAINING LESS THAN THE SAME FULL AND COMPLETE PROTECTION AS IT WOULD
HAVE UNDER A BOND IN COMPLETE CONFORMITY WITH SF 24. (39 COMP. GEN. 60
(1959) ). IN THE INSTANT CASE SF 24 INSTRUCTION NO. 4 (B) STATED
CLEARLY AND WITHOUT ANY AMBIGUITY THE REQUIREMENT THAT THERE SHOULD BE
TWO INDIVIDUAL SURETIES ON THE BOND IF A CORPORATE SURETY WAS NOT
OBTAINED. SINCE THE BOND FURNISHED BY YOU WAS EXECUTED BY ONLY ONE
INDIVIDUAL SURETY, IT CANNOT BE ACCEPTED AS PROVIDING THE GOVERNMENT
WITH THE SAME PROTECTION AS THAT AFFORDED BY A BOND EXECUTED BY TWO
INDIVIDUAL SURETIES.
WHILE YOU MAINTAIN THAT THIS DEFECT SHOULD BE WAIVED SINCE YOU
INADVERTENTLY FAILED TO ATTACH A PROPERLY EXECUTED BOND WITH YOUR OFFER
AND FURNISHED THE SECOND SURETY A WEEK AFTER BID OPENING, OUR OFFICE HAS
CONSISTENTLY HELD THAT IT DOES NOT MATTER WHETHER THE FAILURE TO COMPLY
WITH THE BID BOND REQUIREMENTS WAS DUE TO INADVERTENCE, MISTAKE OR
OTHERWISE. 38 COMP. GEN. 819 (1959); B-146272, AUGUST 18, 1961.
ALLOWING CONSIDERATION OF EXCUSES OF THIS NATURE WOULD CONFER ON BIDDERS
THE ELECTION OF PRESENTING EVIDENCE OF A MISTAKE AND THEREBY BECOMING
ELIGIBLE FOR AN AWARD OR ELECTING NOT TO PRESENT THIS EVIDENCE AND
AVOIDING SUCH ELIGIBILITY. CONFERRING SUCH OPTION WOULD BE MANIFESTLY
UNFAIR TO THOSE BIDDERS WHO BID IN STRICT CONFORMITY WITH THE
INSTRUCTIONS OF SF 24.
WITH RESPECT TO YOUR ALLEGATION THAT THE CORRECTED BID BOND YOU
SUBMITTED AFTER BID OPENING SHOULD BE CONSIDERED, CONSIDERATION OF SUCH
DATA WOULD BE OBVIOUSLY CONTRARY TO THE PRINCIPLES SET FORTH IN 17 COMP.
GEN. 554 (1938) QUOTED IN PERTINENT PART AS FOLLOWS: "TO PERMIT PUBLIC
OFFICERS TO ACCEPT BIDS NOT COMPLYING IN SUBSTANCE WITH THE ADVERTISED
SPECIFICATIONS OR TO PERMIT BIDDERS TO VARY THEIR PROPOSALS AFTERTHE
BIDS ARE OPENED WOULD SOON REDUCE TO A FARCE THE WHOLE PROCEDURE OF
LETTING PUBLIC CONTRACTS ON AN OPEN COMPETITIVE BASIS * * * AS WAS SAID
BY THE COURT IN CITY OF CHICAGO V MOHR, 216 ILL. 320; 74 N.E. 1056 -- *
* * WHERE A BID IS PERMITTED TO BE CHANGED (AFTER THE OPENING) IT IS NO
LONGER THE SEALED BID SUBMITTED IN THE FIRST INSTANCE, AND, TO SAY THE
LEAST, IS FAVORITISM, IF NOT FRAUD -- A DIRECT VIOLATION OF LAW -- AND
CANNOT BE TOO STRONGLY CONDEMNED.'
EVEN THOUGH CONSIDERABLE MONETARY SAVINGS MIGHT ACCRUE TO THE
GOVERNMENT BY CONSIDERATION OF YOUR SUBSTITUTE BOND, WE HAVE HELD THAT
IT IS INFINITELY MORE IN THE PUBLIC INTEREST TO MAINTAIN THE ESTABLISHED
PRINCIPLES OF FORMAL COMPETITIVE PROCUREMENT BY GOVERNMENT AGENCIES THAN
FOR THE GOVERNMENT TO OBTAIN A PECUNIARY ADVANTAGE IN A PARTICULAR CASE
BY A VIOLATION OF THE RULES. 43 COMP. GEN. 268 (1963).
YOU ALSO CONTEND THAT GSA HAS WAIVED THE DEFECT IN YOUR BID BY
ANNOUNCING YOUR CONCERN AS THE LOWEST BIDDER ELIGIBLE FOR AWARD AT THE
TIME BIDS WERE OPENED. IN THIS REGARD GSA ADVISES THAT IT IS NOT THEIR
PRACTICE TO ANNOUNCE THIS DECISION AT SUCH TIME SINCE THE LOWEST BIDDER
ELIGIBLE FOR AWARD CAN ONLY BE DETERMINED AFTER A CLOSE REVIEW (USUALLY
BY A COMMITTEE) OF THE BIDS WITH RESPECT TO THEIR RESPONSIVENESS AND
AFTER RATHER EXTENSIVE INQUIRY INTO THE APPARENT LOW BIDDER'S
RESPONSIBILITY. WE FIND NO INDICATION THAT ANYTHING MORE OCCURRED AT
THE BID OPENING THAN THE OPENING AND READING OF THE AMOUNTS OF THE
SEVERAL BIDS RECEIVED. THIS IS THE REQUIRED PROCEDURE, AND THE READING
OF A BID DOES NOT REQUIRE OR CONSTITUTE ANY DETERMINATION AS TO ITS
RESPONSIVENESS OR VALIDITY OR ELIGIBILITY FOR AWARD. FURTHERMORE, UNDER
THE REGULATIONS QUOTED ABOVE THE CONTRACTING OFFICER HAS NO AUTHORITY TO
WAIVE THE GIVING OF A PROPER BOND. CONSEQUENTLY, ANY ATTEMPT TO WAIVE
SUCH DEFECT WOULD NOT BE BINDING ON THE GOVERNMENT. SEE FEDERAL CROP
INSURANCE CORPORATION V MERRILL, 332 U.S. 380.
THE REGULATIONS AND APPLICABLE LEGAL PRINCIPLES STATED ABOVE HAVE
BEEN ENFORCED AND APPLIED WITHOUT EXCEPTION FOR SOME YEARS, AND WE CAN
SEE NO JUSTIFICATION FOR ANY RELAXATION THEREOF IN THIS INSTANCE, OR FOR
ANY COMPLAINT THAT THEIR APPLICATION INVOLVES ANY BIAS OR PREJUDICE
AGAINST YOU.
FOR THE REASONS SET FORTH ABOVE WE CANNOT CONCLUDE THAT GSA
IMPROPERLY EXCLUDED CONSIDERATION OF YOUR BID AND THEREFORE YOUR PROTEST
IS DENIED.
B-168075, NOV. 4, 1969
OFFICERS AND EMPLOYEES--TRAINING--COMPENSATION PAYABLE--FRINGE
BENEFITS--DIMINUTION
ALTHOUGH 5 U.S.C. 4109 (A), AUTHORIZING ALL OR PART PAY TO EMPLOYEES
ASSIGNED TO TRAINING, IS SILENT RESPECTING EFFECT OF PART PAY ON
BENEFITS OTHERWISE APPLYING TO FULL-TIME EMPLOYEE, IT IS BELIEVED HIS
DUTY STATUS SHOULD BE REGARDED AS OFFICIAL AND TANTAMOUNT TO DUTY STATUS
FOR PURPOSES OF VARIOUS FRINGE BENEFITS TO WHICH HE IS OTHERWISE
ENTITLED, AND THAT IT WOULD NOT BE IN KEEPING WITH PURPOSES OF TRAINING
STATUTE TO PENALIZE SUCH EMPLOYEE EITHER BY DIMINUTION OF FRINGE
BENEFITS OTHERWISE APPLICABLE OR BY REQUIRING HIM TO PAY THEREFOR
BECAUSE PART SALARY IS INSUFFICIENT TO COVER REQUIRED CONTRIBUTIONS, BUT
MATTER IS BELIEVED APPROPRIATE FOR RESOLUTION BY CIVIL SERVICE
COMMISSION UNDER 5 U.S.C. 4118 AND OTHER REGULATORY AUTHORITY.
TO MR. HAMPTON:
WE REFER TO YOUR LETTER OF OCTOBER 7, 1969, CONCERNING THE
APPLICATION OF 5 U.S.C. 4109 (A) (1) IN THE CASE OF A FULL-TIME EMPLOYEE
WHO WHILE ASSIGNED TO TRAINING IS PAID LESS THAN HIS FULL BASIC SALARY
IN ACCORDANCE WITH THE AUTHORITY CONTAINED IN THE CITED SECTION. 5
U.S.C. 4109 (A) READS, IN PART, AS FOLLOWS:
"/A) THE HEAD OF AN AGENCY, UNDER THE REGULATIONS PRESCRIBED UNDER
SECTION 4118 (A) (8) OF THIS TITLE AND FROM APPROPRIATIONS OR OTHER
FUNDS AVAILABLE TO THE AGENCY, MAY---
"/1) PAY ALL OR A PART OF THE PAY (EXCEPT OVERTIME, HOLIDAY, OR NIGHT
DIFFERENTIAL PAY) OF AN EMPLOYEE OF THE AGENCY SELECTED AND ASSIGNED FOR
TRAINING UNDER THIS CHAPTER, FOR THE PERIOD OF TRAINING * * *"
SPECIFICALLY YOU WISH TO KNOW HOW THE RECEIPT OF LESS THAN FULL
SALARY DURING THE TRAINING PERIOD WILL AFFECT VARIOUS RIGHTS AND
BENEFITS OTHERWISE APPLICABLE TO SUCH FULL-TIME EMPLOYEE, THAT IS,
RETIREMENT, LIFE INSURANCE, CREDIT FOR WITHIN-GRADE ADVANCES, LEAVE
EARNING, ETC. AS YOU POINT OUT IN YOUR LETTER AN AGENCY MAY PAY LESS
THAN FULL BASIC SALARY DURING THE PERIOD OF TRAINING EITHER BY PAYING
ONLY A PERCENTAGE OF THE SALARY FOR THE FULL TRAINING PERIOD OR PAYING
FULL SALARY FOR A PART OF THE TRAINING PERIOD AND NO SALARY AT ALL FOR
THE REMAINDER OF SUCH PERIOD.
THE STATUTE IS SILENT CONCERNING THE EXTENT AND MANNER IN WHICH THE
PAYMENT OF LESS THAN FULL SALARY WILL AFFECT OTHER RIGHTS AND BENEFITS
OTHERWISE APPLYING TO A FULL-TIME EMPLOYEE WHO PARTICIPATES IN A
TRAINING PROGRAM. IT IS OUR VIEW, HOWEVER, THAT WHEN AN EMPLOYEE IS
ENGAGED IN TRAINING WHICH HAS BEEN OFFICIALLY AUTHORIZED UNDER THE
STATUTE AS BEING DIRECTLY RELATED TO PERFORMANCE BY THE EMPLOYEE OF
OFFICIAL DUTIES FOR THE GOVERNMENT AS CONTEMPLATED BY 5 U.S.C. 4101, HIS
STATUS DURING SUCH PERIOD OF TRAINING SHOULD BE REGARDED AS OFFICIAL AND
TANTAMOUNT TO A DUTY STATUS FOR PURPOSES OF THE VARIOUS FRINGE BENEFITS
TO WHICH HE WOULD OTHERWISE BE ENTITLED. WE DO NOT CONSIDER THAT IT
WOULD BE IN KEEPING WITH THE PURPOSES AND OBJECTIVES OF THE TRAINING
STATUTE TO PENALIZE AN EMPLOYEE BECAUSE OF HIS PARTICIPATION IN
OFFICIALLY AUTHORIZED OR DIRECTED TRAINING EITHER BY DIMINUTION OF
FRINGE BENEFITS TO WHICH HE OTHERWISE WOULD BE ENTITLED OR BY REQUIRING
HIM TO MAKE PAYMENT THEREFOR BECAUSE HE IS NOT PAID SUFFICIENT SALARY
DURING THE PERIOD OF TRAINING TO COVER REQUIRED CONTRIBUTIONS.
THE FOREGOING IS, IN OUR OPINION, A REASONABLE AND PRACTICABLE
INTERPRETATION CONSISTENT WITH THE INTENT AND SPIRIT OF THE TRAINING
STATUTE. HOWEVER, SINCE THERE IS NO EXPRESS LANGUAGE IN THE STATUTE
GOVERNING THE MATTER AND WE HAVE NOT FOUND ANY CLEAR EXPRESSION OF
CONGRESSIONAL INTENT IN THE LEGISLATIVE HISTORY THEREOF, WE ARE OF THE
FURTHER OPINION THAT THE MATTER MOST APPROPRIATELY MAY BE RESOLVED
THROUGH THE EXERCISE OF THE REGULATORY AUTHORITY OF THE CIVIL SERVICE
COMMISSION UNDER SECTION 5 U.S.C. 4118 AND OTHER REGULATORY AUTHORITY.
B-167150, NOV. 3, 1969
TAXES--STATE--BUSINESS PRIVILEGE--GOVERNMENT LIABILITY
NEW MEXICO BUREAU OF REVENUE RULING THAT GOVERNMENT RENTALS OF MOTOR
VEHICLES ARE SUBJECT TO N. MEX. GROSS RECEIPTS TAX, IMPOSED ON
PRIVILEGE OF ENGAGING IN CERTAIN BUSINESS ACTIVITIES AND MEASURED BY
GROSS RECEIPTS, WILL NOT BE QUESTIONED ON GROUND OF CONSTITUTIONAL
IMMUNITY SINCE GOVERNING STATUTE EXPLICITLY IMPOSES TAX ON VENDOR OR
PERSON FURNISHING SERVICES AND IT HAS BEEN HELD IN CASES INVOLVING STATE
SALES TAXES THAT GOVT. HAS NO RIGHT TO PURCHASE OR LEASE ITEMS WITHIN
STATE ON TAX-FREE BASIS WHERE LEGAL INCIDENCE OF TAX IS ON VENDOR,
ABSENT, AS HERE, STATE LAW OR REGULATION EXEMPTING GOVT. CONSEQUENTLY,
GOVT.'S LIABILITY FOR TAX WOULD DEPEND ON TERMS OF RENTAL AGREEMENT.
TO THE HERTZ CORPORATION:
YOUR LETTER OF OCTOBER 9, 1969, AND ENCLOSURE, CONCERNS THE
APPLICABILITY OF THE NEW MEXICO GROSS RECEIPTS TAX TO THE RENTAL OF
MOTOR VEHICLES BY THE UNITED STATES.
THE NEW MEXICO BUREAU OF REVENUE HAS RULED THAT RENTALS BY THE UNITED
STATES ARE PROPERLY TAXABLE UNDER ITS GROSS RECEIPTS TAX AND HAS
PROMULGATED ITS POLICY UNDER REVENUE RULING NO. 69-045-1, JULY 8, 1969
(QUOTING FROM THE ENCLOSURE WITH YOUR LETTER):
"SALES AND USE--- PERSONS AND SALES SUBJECT TO TAX--- ENGAGING IN
BUSINESS--- LEASING EQUIPMENT.
--- (FULL TEXT) RECEIPTS FROM LEASING EQUIPMENT EMPLOYED IN NEW
MEXICO, WITH OR WITHOUT OPERATORS, TO THE UNITED STATES OR ANY AGENCY OR
INSTRUMENTALITY THEREOF * * * ARE SUBJECT TO THE GROSS RECEIPTS TAX,
WHETHER SUCH LESSOR HOLDS HIMSELF OUT AS BEING ENGAGED IN THE BUSINESS
OF LEASING EQUIPMENT OR NOT. * * *"
THIS REVENUE RULING IS APPARENTLY AN INTERPRETATION OF THE APPLICABLE
NEW MEXICO STATUTE, MADE UNDER THE GENERAL POWER OF THE COMMISSIONER OF
THE BUREAU OF REVENUE TO IMPLEMENT AND ENFORCE THE PROVISIONS OF LAW
WHICH ARE ADMINISTERED BY HIS BUREAU. SEE SECTION 72-13-23, NEW MEXICO
STATUTES, 1953, ANNOTATED (N.M.S.A.).
WE HAVE HELD IN PRIOR CASES INVOLVING STATE SALES TAXES THAT THE
UNITED STATES HAS NO RIGHT TO PURCHASE OR LEASE ITEMS WITHIN THE
TERRITORIAL JURISDICTION OF THE STATE ON A TAX-FREE BASIS WHERE THE
LEGAL INCIDENCE OF THE TAX IS ON THE VENDOR, ABSENT SOME STATE LAW OR
REGULATION EXEMPTING THE GOVERNMENT. SEE ALABAMA V KING AND BOOZER, 314
U.S. 1; 24 COMP. GEN. 150; 32 COMP. GEN. 423; ID. 577; 33 COMP.
GEN. 453; AND 41 COMP. GEN. 719. HOWEVER, WHERE THE LEGAL INCIDENCE OF
THE TAX IS ON THE VENDEE, THE UNITED STATES IS ENTITLED UNDER ITS
CONSTITUTIONAL PRIVILEGE TO MAKE PURCHASES OR TO LEASE FREE FROM STATE
TAXES.
IT IS CLEAR FROM A READING OF SECTION 72-16A-2, N.M.S.A., THAT THE
GROSS RECEIPTS TAX IN QUESTION IS A TAX ON THE PRIVILEGE OF ENGAGING IN
CERTAIN BUSINESS ACTIVITIES WITHIN NEW MEXICO, THE AMOUNT OF TAX BEING
MEASURED BY THE GROSS RECEIPTS OF THE PERSON ENGAGING IN BUSINESS. THERE
IS NOTHING IN THE NEW MEXICO GROSS RECEIPTS TAX, SECTIONS 72-16A-1 TO
72-16A-19, WHICH REQUIRES THAT THE VENDOR OR THE PERSON FURNISHING THE
SERVICES COLLECT THE TAX FROM THE VENDEE OR THE PERSON BEING FURNISHED
THE SERVICE. IN FACT, SECTION 72-16A-4 EXPLICITEDLY IMPOSES THE TAX ON
THE PERSON ENGAGING IN BUSINESS. SINCE THE LEGAL INCIDENCE OF THE TAX
INVOLVED HERE IS ON THE VENDOR, THE UNITED STATES WOULD NOT BE IMMUNE
FROM SUCH TAX UNLESS SPECIFICALLY EXEMPTED BY STATE LAW OR REGULATIONS.
SECTION 72-16A-14.9 EXEMPTS RECEIPTS FROM TANGIBLE PERSONAL PROPERTY
SOLD TO THE UNITED STATES OR AN AGENCY OR INSTRUMENTALITY OF IT.
SECTION 72-16A-12.16 EXEMPTS FROM GROSS RECEIPTS THE OCCASIONAL SALE OR
LEASING OF PROPERTY OR A SERVICE BY A PERSON NOT REGULARLY ENGAGED OR
HOLDING HIMSELF OUT AS REGULARLY ENGAGED IN SUCH BUSINESS OR LEASING.
HOWEVER, NEITHER OF THESE EXEMPTIONS APPLY TO A REGULAR SERVICE BUSINESS
LEASING TO THE UNITED STATES, AND IN THE ABSENCE OF A SPECIFIC
EXEMPTION, SECTION 72-16A-5 REQUIRES THAT ALL RECEIPTS BE PRESUMED TO BE
TAXABLE RECEIPTS.
ACCORDINGLY, WE WOULD NOT QUESTION NEW MEXICO BUREAU OF REVENUE
RULING NO. 69-045-1, DATED JULY 8, 1969, TO THE EFFECT THAT "RENTALS" TO
THE UNITED STATES ARE SUBJECT TO THE NEW MEXICO GROSS RECEIPTS TAX.
HOWEVER, WHETHER THE UNITED STATES WOULD BE REQUIRED TO PAY THE AMOUNT
OF THE TAX TO THE LESSOR WOULD DEPEND ON THE TERMS OF THE RENTAL
AGREEMENT. IN OTHER WORDS, THE UNITED STATES IS NOT CONSTITUTIONALLY
IMMUNE FROM THE ECONOMIC BURDEN OF THE STATE TAX INVOLVED HERE IF BY
CONTRACT OR OTHERWISE IT IS LIABLE TO THE VENDOR OR LESSOR FOR THE
AMOUNT OF THE TAX.
B-167309(1), NOV. 3, 1969
BIDS--QUALIFIED--WARRANTIES
LOW BIDDER WHO FAILED TO SUBMIT DESCRIPTIVE LITERATURE REQUIRED BY
INVITATION FOR SOLID-STATE LASER AND WHO PROTESTED AWARD ON BASIS SUCH
FAILURE WAS MINOR DEVIATION UNDER FEDERAL PROCUREMENT REGULATIONS BUT
WHO QUALIFIED 12-MONTH WARRANTY REQUIREMENT BY ADDING ALTERNATE
LIMITATION OF 500 HOURS AND SUBSTITUTED RESPONSIBILITY FOR TESTING
EQUIPMENT AT FINAL TEST DETERMINATION IS DENIED PROTEST SINCE
QUALIFICATIONS OF LIABILITY ARE NOT MINOR TECHNICALITIES OR
INFORMALITIES WHICH CAN BE WAIVED IN GOVERNMENT'S INTEREST AND FAILURE
TO ACCEPT RESPONSIBILITY FOR TESTING EQUIPMENT AT FINAL TEST
DETERMINATION IS MORE THAN INSIGNIFICANT DEVIATION FROM INVITATION'S
REQUIREMENTS. SUCH EXCEPTIONS WERE SUFFICIENT TO REQUIRE BID REJECTION
AND MAKE IT UNNECESSARY TO PASS UPON QUESTION OF DESCRIPTIVE LITERATURE.
TO LASER DIODE LABORATORIES, INC.:
REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 23, 1969, AND SUPPORTING
LETTER DATED JULY 3, 1969, PROTESTING REJECTION OF YOUR BID AND AWARD OF
A CONTRACT TO ANY OTHER FIRM RELATIVE TO INVITATION FOR BIDS (IFB) NO.
21-1969-4 WHICH WAS ISSUED BY THE U.S. DEPARTMENT OF AGRICULTURE -
FOREST SERVICE, BERKELEY, CALIFORNIA.
THE INVITATION, DATED MAY 21, 1969, SOLICITED BIDS FOR A SOLID-STATE
LASER TO CONFORM TO SPECIFICATIONS WHICH WERE BASICALLY
PERFORMANCE-TYPE. ALTHOUGH YOUR BID OF $5,400 WAS THE APPARENT LOW BID,
AWARD WAS MADE AT THE HIGHER PRICE OF $5,500 TO RCA ELECTRONIC
COMPONENTS ON JUNE 19, 1969. IN A LETTER DATED JUNE 23, 1969, THE
CONTRACTING OFFICER FORMALLY NOTIFIED YOU THAT YOUR BID WAS REJECTED AND
GAVE AS THE REASON FOR REJECTION YOUR FAILURE TO SUBMIT AS PART OF YOUR
BID THE DESCRIPTIVE LITERATURE REQUIRED BY THE IFB. THE ADMINISTRATIVE
REPORT NOTES, HOWEVER, THAT YOU ALSO FAILED TO INDICATE MAKE AND MODEL
OF THE OFFERED PRODUCT SPECIFIED IN THE IFB AND, FURTHER, THAT YOU TOOK
EXCEPTION TO SEVERAL OF THE CONDITIONS AND SPECIFICATIONS.
YOU CONTEND THAT THE FAILURE TO SUBMIT SUFFICIENT DESCRIPTIVE
LITERATURE IS A MINOR DEVIATION WITHIN THE MEANING OF FEDERAL
PROCUREMENT REGULATION (FPR) 1-2.405, AND YOU CONTEND THAT THE
DEFICIENCY EITHER SHOULD HAVE BEEN WAIVED BY THE CONTRACTING OFFICER OR
YOU SHOULD HAVE BEEN GIVEN THE OPPORTUNITY TO CURE THE DEFICIENCY. WHILE
YOUR POSITION REGARDING THE REQUIREMENT FOR DESCRIPTIVE LITERATURE
APPEARS TO HAVE SOME MERIT, WE FIND IT UNNECESSARY TO PASS UPON THE
QUESTION HERE SINCE THE RECORD SHOWS THAT YOUR BID WAS NOT RESPONSIVE TO
SEVERAL OTHER MATERIAL CONDITIONS AND SPECIFICATIONS OF THE INVITATION.
A REVIEW OF THE RECORD SHOWS THAT YOU QUALIFIED THE TWELVE-MONTH
WARRANTY REQUIREMENT IN THE INVITATION BY ADDING TO IT THE ALTERNATIVE
LIMITATION OF 500 HOURS, WHICHEVER SHOULD OCCUR FIRST. EXCEPTION WAS
ALSO TAKEN TO THE INSPECTION AND ACCEPTANCE PROVISIONS. IN THE LATTER
CONNECTION THE IFB READ AS FOLLOWS: "2. THE CONTRACTOR WILL DELIVER
THE EQUIPMENT AT THE LOCATION SPECIFIED ON THE SF-36. HE WILL INSTALL
THE EQUIPMENT AND PERFORM A FINAL TEST DEMONSTRATION OF THE EQUIPMENT IN
THE PRESENCE OF THE CONTRACTING OFFICE AND/OR HIS REPRESENTATIVE, TO
ASSURE THE EQUIPMENT MEETS ALL THE CONTRACT REQUIREMENTS AND OPERATES
CORRECTLY. SHOULD THE EQUIPMENT NOT MEET THE CONTRACT REQUIREMENTS, THE
CONTRACTOR WILL BE REQUIRED TO CORRECT DEFICIENCIES BEFORE THE EQUIPMENT
IS ACCEPTED AND FINAL PAYMENT IS MADE.' YOUR BID DELETED THE PRECEDING
AND SUBSTITUTED THE FOLLOWING:
"2. THE EQUIPMENT WILL BE DELIVERED TO THE LOCATION SPECIFIED ON TH
SF-36. THE EQUIPMENT WILL BE TESTED BY THE U.S. FOREST SERVICE TO
ASSURE THAT THE EQUIPMENT MEETS ALL THE CONTRACT REQUIREMENTS AND
OPERATES CORRECTLY. SHOULD THE EQUIPMENT NOT MEET THE CONTRACT
REQUIREMENTS, THE CONTRACTOR WILL BE REQUIRED TO CORRECT DEFICIENCIES
BEFORE THE EQUIPMENT IS ACCEPTED AND FINAL PAYMENT IS MADE.'
WE HAVE CONSISTENTLY HELD THAT THE QUALIFICATIONS OF LIABILITY ARE
NOT MINOR TECHNICALITIES OR INFORMALITIES WHICH CAN BE WAIVED IN THE
INTERESTS OF THE GOVERNMENT. 30 COMP. GEN. 179; B-153193, DATED APRIL
8, 1964; SEE ALSO B-154972, DATED OCTOBER 8, 1964. WE ALSO BELIEVE
THAT YOUR FAILURE TO ACCEPT RESPONSIBILITY FOR THE TESTING OF THE
EQUIPMENT AT A FINAL TEST DEMONSTRATION IS MORE THAN AN INSIGNIFICANT
DEVIATION FROM THE INVITATION'S REQUIREMENTS. UNDER AN ADVERTISED
PROCUREMENT ALL BIDDERS MUST SUBMIT BIDS WHICH ARE BASED UPON THE SAME
SPECIFICATIONS, AND ALL BIDS MUST BE EVALUATED ON THE SAME BASIS. AND
WHEN WAIVER OF CERTAIN PROVISIONS OF AN INVITATION FOR BIDS MIGHT RESULT
IN A COMPETITIVE ADVANTAGE TO ONE OR MORE BIDDERS, SUCH PROVISIONS MUST
BE CONSIDERED MATERIAL PROVISIONS WHICH MAY NOT BE WAIVED.
IT IS OUR OPINION THAT THE TWO PROVISIONS SET OUT ABOVE TO WHICH YOUR
BID TOOK EXCEPTION WERE MATERIAL PROVISIONS AND THAT WAIVER WOULD HAVE
BEEN PREJUDICIAL TO OTHER BIDDERS. IT FOLLOWS THAT THESE EXCEPTIONS IN
YOUR BID WERE SUFFICIENT TO REQUIRE ITS REJECTION.
ACCORDINGLY, YOUR PROTEST MUST BE DENIED. WE ARE, HOWEVER, ADVISING
THE DEPARTMENT OF AGRICULTURE BY LETTER OF TODAY, COPY ENCLOSED, OF THE
DEFICIENCIES PERTAINING TO THE DESCRIPTIVE LITERATURE REQUIREMENT IN
THIS PROCUREMENT SO THAT THEY MAY BE CORRECTED IN FUTURE PROCUREMENTS.
B-167309(2), NOV. 3, 1969
SPECIFICATIONS--DESCRIPTIVE DATA--PERFORMANCE CHARACTERISTICS
CONCERNING DEFICIENCIES OBSERVED IN FOREST SERVICE INVITATION FOR
BIDS WITH RESPECT TO INVITATION'S REQUIREMENT THAT DESCRIPTIVE
LITERATURE BE SUBMITTED ESTABLISHING "PERFORMANCE CHARACTERISTICS" AND
"OPERATION" OF PRODUCTS TO BE FURNISHED, IT IS SUGGESTED CONSIDERATION
BE GIVEN TO ASSURING PROPER REQUIREMENTS FOR DESCRIPTIVE LITERATURE IN
FUTURE PROCUREMENTS, AS GAO HAS CONSISTENTLY TAKEN POSITION THAT SUCH
GENERAL DESCRIPTION DOES NOT PROVIDE SUFFICIENT DETAIL AS TO WHAT
INFORMATION AGENCY NEEDS, AND, THEREFORE, DOES NOT PROVIDE FOR COMMON
EVALUATION OF BIDS; MOREOVER, IT SEEMS THAT REQUIREMENTS FOR
DESCRIPTIVE LITERATURE OF PERFORMANCE CHARACTERISTICS, ABSENT FURTHER
CLARIFICATION, COULD BE MET MERELY BY "PARROTING BACK" GOVERNMENT'S
PERFORMANCE SPECIFICATIONS, AND IN THESE CIRCUMSTANCES, LEGITIMACY OF
SUCH REQUIREMENT IS QUESTIONED. SEE 46 COMP. GEN. 315.
TO MR. SECRETARY:
ENCLOSED IS A COPY OF OUR DECISION OF TODAY ON THE REJECTION OF A BID
OF LASER DIODE LABORATORIES, INCORPORATED, AS NONRESPONSIVE TO FOREST
SERVICE IFB NO. 21-1969-4, DATED MAY 21, 1969. THIS MATTER WAS THE
SUBJECT OF A REPORT DATED JULY 22, 1969, FROM THE DIRECTOR, OFFICE OF
PLANT AND OPERATIONS.
ALTHOUGH WE HAVE DENIED THE PROTEST, WE WISH TO POINT OUT THE
DEFICIENCIES WE HAVE OBSERVED WITH RESPECT TO THE INVITATION'S
REQUIREMENT FOR DESCRIPTIVE LITERATURE. THE APPLICABLE CLAUSE IN THE
INVITATION PROVIDED AS FOLLOWS: "REQUIREMENT FOR DESCRIPTIVE
LITERATURE: (A) DESCRIPTIVE LITERATURE AS SPECIFIED IN THIS INVITATION
FOR BIDS MUST BE FURNISHED AS A PART OF THE BID AND MUST BE RECEIVED
BEFORE THE TIME SET FOR OPENING BIDS. THE LITERATURE FURNISHED MUST BE
IDENTIFIED TO SHOW THE ITEM IN THE BID TO WHICH IT PERTAINS. THE
DESCRIPTIVE LITERATURE IS REQUIRED TO ESTABLISH, FOR THE PURPOSES OF BID
EVALUATION AND AWARD, DETAILS OF THE PRODUCTS THE BIDDER PROPOSES TO
FURNISH AS TO MODEL, PERFORMANCE CHARACTERISTICS, AND OPERATION.''B)
FAILURE OF THE DESCRIPTIVE LITERATURE TO SHOW THAT THE PRODUCT OFFERED
CONFORMS TO THE SPECIFICATIONS AND OTHER REQUIREMENTS OF THIS INVITATION
FOR BIDS WILL REQUIRE REJECTION OF THE BID. FAILURE TO FURNISH THE
DESCRIPTIVE LITERATURE BY THE TIME SPECIFIED IN THE INVITATION FOR BIDS
WILL REQUIRE REJECTION OF THE BID, EXCEPT THAT IF THE MATERIAL IS
TRANSMITTED BY MAIL AND IS RECEIVED LATE, IT MAY BE CONSIDERED UNDER THE
PROVISIONS FOR CONSIDERING LATE BIDS, AS SET FORTH ELSEWHERE IN THIS
INVITATION FOR BIDS.
THE ABOVE CLAUSE REQUIRES BIDDERS TO SUBMIT DESCRIPTIVE LITERATURE AS
SPECIFIED IN THE INVITATION, BUT WE NOTE THAT DESCRIPTIVE LITERATURE AS
SUCH IS NOT ELSEWHERE SPECIFIED. WHILE THE RECITAL IN THE ABOVE QUOTED
CLAUSE OF SUCH GENERAL SUBJECTS AS "PERFORMANCE CHARACTERISTICS" AND
,OPERATION" COINCIDE WITH THOSE WHICH ARE SET OUT IN THE FOOTNOTE TO
FEDERAL PROCUREMENT REGULATION 1-2.202-5 (D) AS SUBJECTS THAT MIGHT
REQUIRE DESCRIPTION, OUR OFFICE HAS CONSISTENTLY TAKEN THE POSITION THAT
SUCH A GENERAL DESCRIPTION DOES NOT PROVIDE SUFFICIENT DETAIL AS TO WHAT
INFORMATION THE AGENCY NEEDS, AND THEREFORE, DOES NOT PROVIDE FOR A
COMMON EVALUATION OF BIDS. 46 COMP. GEN. 315. MOREOVER, WITH RESPECT
TO THE REQUIREMENT FOR DESCRIPTIVE LITERATURE OF PERFORMANCE
CHARACTERISTICS, IT WOULD SEEM THAT, IN THE ABSENCE OF FURTHER
CLARIFICATION, SUCH REQUIREMENT COULD BE MET MERELY BY "PARROTING BACK"
THE GOVERNMENT'S PERFORMANCE SPECIFICATIONS. IN THESE CIRCUMSTANCES WE
QUESTION THE LEGITIMACY OF SUCH A REQUIREMENT. 46 COMP. GEN. 315;
B-150622, JUNE 6, 1963.
WE THEREFORE SUGGEST CONSIDERATION BE GIVEN TO SUCH STEPS AS MAY BE
NECESSARY TO ASSURE PROPER REQUIREMENTS FOR DESCRIPTIVE LITERATURE IN
FUTURE PROCUREMENTS.
B-165901, OCT. 31, 1969
TO MR. CHARLES R. THOMPSON:
REFERENCE IS MADE TO YOUR LETTER DATED OCTOBER 15, 1969, WITH
ENCLOSURES, REGARDING OUR DECISION TO YOU, B-165901, DATED FEBRUARY 20,
1969. IN THAT DECISION WE AFFIRMED OUR PREVIOUS DECISION, B-165901, OF
JANUARY 28, 1969, TO YOU, IN WHICH WE EXPLAINED THAT UNDER THE GOVERNING
LAW AND REGULATIONS, THERE IS NO LEGAL AUTHORITY TO ALLOW YOUR CLAIM FOR
REIMBURSEMENT OF THE COST OF SHIPPING YOUR HOUSEHOLD EFFECTS FROM
TOPEKA, KANSAS, TO COLORADO SPRINGS, COLORADO, ON MAY 23, 1968, PRIOR TO
YOUR RETIREMENT FROM THE AIR FORCE ON AUGUST 13, 1968.
WITH YOUR PRESENT LETTER YOU ENCLOSED A COPY OF NOTIFICATION OF
PERMANENT CHANGE OF STATION REASSIGNMENT DATED APRIL 24, 1968, FROM THE
DEPARTMENT OF THE AIR FORCE, HEADQUARTERS 838TH COMBAT SUPPORT GROUP
(TAC), FORBES AIR FORCE BASE, KANSAS 66620. THE DOCUMENT STATES THAT ON
APRIL 16, 1968, YOU WERE SELECTED FOR PERMANENT CHANGE OF STATION IN
SEPTEMBER 1968, TO DUTY STATION AT TAN SON NHUT AIR BASE, VIETNAM. YOU
SAY THAT YOUR CLAIM SHOULD BE ALLOWED SINCE YOU COULD HAVE SHIPPED YOUR
HOUSEHOLD EFFECTS TO COLORADO SPRINGS, COLORADO, INCIDENT TO THE
NOTIFICATION OF APRIL 24, 1968, NOTWITHSTANDING YOU HAD APPLIED FOR
VOLUNTARY RETIREMENT AND YOU WERE NOT GOING TO VIETNAM.
PARAGRAPH 2 OF THE NOTIFICATION OF APRIL 24, 1968, IS AS FOLLOWS:
"RECORDS SHOW THAT AS OF THE DATE YOU WERE SELECTED FOR THIS
ASSIGNMENT, YOU HAD NOT INITIATED ACTION FOR VOLUNTARY RETIREMENT,
RELEASE FROM EXTENDED ACTIVE DUTY, RESIGNATION, OR ANYTHING ELSE THAT
WOULD PRECLUDE YOUR SELECTION FOR THIS ASSIGNMENT; THEREFORE YOU WILL
COMPLY WITH THE ASSIGNMENT INSTRUCTIONS AS INDICATED BELOW.'
THE NOTIFICATION WAS ISSUED TO YOU ON THE ASSUMPTION THAT YOU HAD NOT
INITIATED ACTION FOR VOLUNTARY RETIREMENT OR ANYTHING ELSE THAT WOULD
PRECLUDE YOUR SELECTION FOR ASSIGNMENT TO VIETNAM.
YOU DID NOT, HOWEVER, COMPLETE THE NOTIFICATION OF ASSIGNMENT FORM
AND THE RECORD SHOWS THAT YOU HAD APPLIED FOR VOLUNTARY RETIREMENT UNDER
10 U.S.C. 8914, TO BE EFFECTIVE IN FEBRUARY 1968. HENCE, IT IS CLEAR
THAT THE NOTIFICATION OF APRIL 24, 1968, COULD NOT PROPERLY BE USED AS A
BASIS TO SHIP YOUR HOUSEHOLD EFFECTS IN ANY CASE.
SINCE YOU SHIPPED YOUR HOUSEHOLD EFFECTS PRIOR TO THE ISSUANCE OF
YOUR RETIREMENT ORDERS OF JULY 12, 1968, AND IN THE ABSENCE OF THE
EMERGENCY AUTHORIZATION CONTEMPLATED BY PARAGRAPH M8015-1 OF THE JOINT
TRAVEL REGULATIONS, THERE IS NO AUTHORITY OF LAW TO ALLOW YOUR CLAIM FOR
REIMBURSEMENT.
ACCORDINGLY, OUR DECISIONS OF JANUARY 28 AND FEBRUARY 20, 1969,
B-165901, ARE AFFIRMED.
WE TRUST THIS LETTER WILL ENABLE YOU TO BETTER UNDERSTAND THE REASONS
WHY, UNDER THE LAW, WE HAVE NO ALTERNATIVE BUT TO AFFIRM OUR PRIOR
ACTION IN THE MATTER.
B-167087, OCT. 31, 1969
TO MR. WILLIAM R. BURT:
CONSIDERATION HAS BEEN GIVEN TO YOUR LETTER OF OCTOBER 1, 1969,
WHICH, IN EFFECT REQUESTS REVIEW OF MY DECISION, B-167087 OF JULY 25,
1969, TO YOU, AS TO YOUR INDEBTEDNESS TO THE UNITED STATES IN THE AMOUNT
OF $928.90.
THE AMOUNT OF $928.90 REPRESENTS THE FEES CHARGED FOR REPRODUCING AND
CERTIFYING CERTAIN RECORDS OF THE INTERSTATE COMMERCE COMMISSION FOR USE
IN CONNECTION WITH THE CASE OF INTERSTATE INVESTORS, INC., PLAINTIFFS V
UNITED STATES OF AMERICA AND INTERSTATE COMMERCE COMMISSION, DEFENDANTS,
TRANSCONTINENTAL BUS SYSTEM, INC., INTERVENOR, CIVIL ACTION NO. 66 CIV.
3004 IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK. IN YOUR LETTER OF OCTOBER 1, 1969, AS WELL AS IN
CORRESPONDENCE PREVIOUSLY CONSIDERED YOU URGE THAT 5 U.S.C. 140, WHICH
HAS BEEN RECODIFIED AS 31 U.S.C. 483A, DOES NOT PROVIDE A STATUTORY
BASIS FOR THE INTERSTATE COMMERCE COMMISSION TO CHARGE YOU WITH THIS
AMOUNT BUT THAT IN ACCORDANCE WITH THE PROVISIONS OF 28 U.S.C. 2112 THE
EXPENSE OF REPRODUCING AND CERTIFYING THE RECORDS, SHOULD REST UPON THE
INTERSTATE COMMERCE COMMISSION.
EXAMINATION OF THE FILE DISCLOSES THAT A SIMILAR ARGUMENT WAS
PRESENTED TO THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK IN SUPPORT OF A MOTION FOR PRODUCTION OF RECORD WHICH WAS
OPPOSED IN A WRITTEN MEMORANDUM SUBMITTED BY DAVID S. J. BROWN,
ATTORNEY, DEPARTMENT OF JUSTICE, DONALD F. TURNER, ASSISTANT ATTORNEY
GENERAL, ROBERT M. MORGANTHAU, UNITED STATES ATTORNEY, ATTORNEYS FOR THE
UNITED STATES OF AMERICA, AND ROBERT W. GINNANE, GENERAL COUNSEL, AND
JEROME NELSON, ATTORNEYS FOR THE INTERSTATE COMMERCE COMMISSION. THE
MEMORANDUM WAS FILED WITH THE COURT AND ON NOVEMBER 29, 1966, COPIES
WERE SERVED ON COUNSEL FOR ALL PARTIES OF RECORD BY FIRST CLASS MAIL,
POSTAGE PREPAID. THE MATTER WAS ARGUED BEFORE JUDGE FREDERICK VAN PELT
BRYAN ON APRIL 5, 1967.
A JOINT LETTER DATED THE FOLLOWING DAY, APRIL 6, 1967, SIGNED BY
JEROME NELSON, COUNSEL FOR THE INTERSTATE COMMERCE COMMISSION AND
FREDERICK W. P. LORENZEN, COUNSEL FOR INTERSTATE INVESTORS, NC., WAS
ADDRESSED TO JUDGE BRYAN IN WHICH IT WAS STATED AMONG OTHER THINGS THAT
"COUNSEL FOR PLAINTIFF HAS AGREED TO ORDER, AT PLAINTIFF'S EXPENSE,
CERTIFIED COPIES OF ALL MATTERS IN THE ABOVE DOCKETS FOR FILING WITH THE
COURT.'
BY LETTER DATED APRIL 7, 1967, RUSSEL H. BEATIE, JR. OF THE FIRM OF
ROYALL, KOEGEL, ROGERS AND WELLS ADDRESSED A LETTER TO THE OFFICE OF THE
SECRETARY, INTERSTATE COMMERCE COMMISSION IN WHICH HE STATED:
"PURSUANT TO AUTHORIZATION BY OUR CLIENT, INTERSTATE INVESTORS, INC.,
I ENCLOSE A STENOGRAPHER'S TRANSCRIPT OF THE PROCEEDINGS IN THIS CASE
FOR CERTIFICATION AND INCLUSION AS PART OF THE RECORD ON APPEAL BEFORE
THE THREE-JUDGE COURT SITTING IN THE SOUTHERN DISTRICT OF NEW YORK. YOU
ARE HEREBY AUTHORIZED TO PREPARE AND CERTIFY ALL OTHER ITEMS IN THE
DOCKETS INVOLVED IN THIS CASE AT THE EXPENSE OF THE PLAINTIFF AND TO
FORWARD THE ENTIRE RECORD TO THE CLERK, UNITED STATES DISTRICT COURT,
SOUTHERN DISTRICT OF NEW YORK, FOLEY SQUARE, NEW YORK, NEW YORK.'
"* * * WE UNDERSTAND THAT THE COST TO BE BORNE BY THE PLAINTIFF FOR
REPRODUCTION OF THIS RECORD IS LIMITED TO ANY PAGES WHICH BY VIRTUE OF
UNOFFICIAL MARKINGS IS UNACCEPTABLE TO THE COMMISSION. CERTIFICATION
AND ANY REPRODUCTION WILL BE GOVERNED BY THE JOINT LETTER OF THE
PLAINTIFF AND THE INTERSTATE COMMERCE COMMISSION TO JUDGE FREDERICK VAN
PELT BRYAN, DATED APRIL 6, 1967.' IN ACCORDANCE WITH THAT LETTER SIGNED
BY MR. BEATIE THE REQUESTED MATERIAL WAS SENT TO THE UNITED STATES
DISTRICT COURT, SOUTHERN DISTRICT OF NEW YORK.
BY LETTER DATED APRIL 26, 1967, MR. BEATIE WAS NOTIFIED BY THE
INTERSTATE COMMERCE COMMISSION OF THE COSTS INVOLVED. THAT AGENCY ALSO
ADDRESSED REQUESTS FOR PAYMENT TO MR. BEATIE ON JANUARY 24, AND MARCH
26, 1968.
BECAUSE OF A LACK OF RESPONSE TO THOSE REQUESTS, THE BUDGET AND
FISCAL OFFICE OF THE INTERSTATE COMMERCE COMMISSION ON FEBRUARY 5, 1969,
ADDRESSED A LETTER REQUESTING PAYMENT TO MR. FREDERICK W. P. LORENZEN
OF THE FIRM OF ROYALL, KOEGEL, ROGERS AND WELLS. A REPLY DATED FEBRUARY
7, 1969, WAS RECEIVED FROM MR. LORENZEN IN WHICH HE POINTED OUT THAT MR.
BEATIE'S LETTER (DATED APRIL 7, 1967) ADVISED THAT THE COSTS WOULD BE
PAID BY INTERSTATE INVESTORS, INC., AND THAT INTERSTATE INVESTORS WOULD
AGAIN BE REQUESTED TO MAKE THE PAYMENT. ACCORDINGLY THE BUDGET AND
FISCAL OFFICE OF THE INTERSTATE COMMERCE COMMISSION ON FEBRUARY 11,
1969, ADDRESSED A LETTER TO YOU INFORMING YOU OF THE INCURRING OF THE
OBLIGATION, THE CORRESPONDENCE WITH YOUR ATTORNEYS, AND REQUESTING
IMMEDIATE LIQUIDATION OF THE INDEBTEDNESS.
YOUR REPLY OF FEBRUARY 14, 1969, REFERRED TO 5 U.S.C. 140 (NOW 31
U.S.C. 483A) AND 28 U.S.C. 2112 AND STATED YOUR REASONS FOR BELIEVING
THAT NO BASIS EXISTS FOR THE CHARGE. YOU REQUESTED THAT THE OPINION OF
THE ATTORNEY GENERAL BE SOUGHT. THE FILE WAS THEN REVIEWED IN THE
INTERSTATE COMMERCE COMMISSION AND REFERRED TO THE CLAIMS DIVISION,
UNITED STATES GENERAL ACCOUNTING OFFICE FOR FURTHER COLLECTION
PROCEEDINGS.
THE CLAIMS DIVISION, UNITED STATES GENERAL ACCOUNTING OFFICE ON APRIL
8, 1969, WROTE YOU AND REQUESTED PAYMENT OF THE DEBT. YOUR REPLY OF
APRIL 18, 1969, AND ENCLOSURE AGAIN REFERRED TO 5 U.S.C. 140 (NOW 31
U.S.C. 483A) AND 28 U.S.C. 2112. THE LETTER STATED THAT IT WOULD APPEAR
NECESSARY FOR THE ATTORNEY GENERAL TO PASS ON THE INTERPRETATION OF THE
INTERSTATE COMMERCE COMMISSION. IT WAS ALSO REQUESTED THAT THE ISSUES
RAISED IN THE LETTER BE GIVEN THE SERIOUS CONSIDERATION THAT THEY
REQUIRED.
THE ISSUES RAISED IN YOUR LETTER OF APRIL 18, 1969, WERE FULLY
CONSIDERED AND DISCUSSED IN MY DECISION, B-167087 OF JULY 25, 1969, TO
YOU WHICH CONCLUDED THAT THE CHARGES LEVIED BY THE INTERSTATE COMMERCE
COMMISSION FOR THE REQUESTED REPRODUCTION OF RECORDS WERE AUTHORIZED
UNDER 31 U.S.C. 483A AND THAT YOU ARE IN DEBT TO THE UNITED STATES IN
THE AMOUNT OF $928.90. IT IS CONSIDERED UNNECESSARY TO REPEAT THE
REASONS FOR THAT DECISION HERE.
THE ENTIRE FILE AND THE ISSUES PRESENTED HAVE AGAIN BEEN THOROUGHLY
REVIEWED. IT IS AGAIN CONCLUDED THAT YOU ARE INDEBTED TO THE UNITED
STATES IN THE AMOUNT OF $928.90. IT SHOULD BE NOTED THAT THE ISSUES
RAISED BY YOU HAVE APPARENTLY BEEN CONSIDERED BY THE OFFICE OF THE
UNITED STATES ATTORNEY FOR THE SOUTHERN DISTRICT OF NEW YORK, THE OFFICE
OF THE ASSISTANT ATTORNEY GENERAL OF THE UNITED STATES, ATTORNEYS FOR
THE INTERSTATE COMMERCE COMMISSION, JUDGE FREDERICK VAN PELT BRYAN OF
THE SOUTHERN DISTRICT OF NEW YORK, COUNSEL EMPLOYED TO REPRESENT YOU IN
THE LITIGATION WHICH GAVE RISE TO THE INDEBTEDNESS, AND ON TWO OCCASIONS
BY THIS OFFICE.
ACCORDINGLY UNLESS THE AMOUNT OF $928.90 IS RECEIVED IN THIS OFFICE
FROM YOU BY RETURN MAIL, THE MATTER OF YOUR INDEBTEDNESS WILL BE
REFERRED TO THE DEPARTMENT OF JUSTICE.
B-167322, OCT. 31, 1969
COMPENSATION--OVERTIME--UNCOMMON TOURS OF DUTY
GENERAL SERVICES ADMINISTRATION (GSA) WAGE BOARD EMPLOYEE, ASSIGNED
TO "FOURTH SHIFT" WITH WORK HOURS VARYING FROM WEEK TO WEEK, IS NOT
ENTITLED TO OVERTIME COMPENSATION UNLESS SUCH WORK EXCEEDS 8 HOURS DAILY
OR 40 HOURS WEEKLY AND, WHILE PROVISIONS OF 5 U.S.C. 6102 REGARDING
"REGULAR WORK HOURS" ARE NOT APPLICABLE TO WAGE BOARD EMPLOYEES, GSA HAS
ADOPTED PROVISIONS FOR APPLICATION TO ITS WAGE BOARD EMPLOYEES AND
DETERMINED ADMINISTRATIVELY THAT FOURTH SHIFT IS ESSENTIAL TO PROVIDE
CONTINUOUS COVERAGE OF FEDERAL BUILDINGS BUT, SINCE ATTENDANCE RECORDS
PROVIDED BY GSA ARE INCONSISTENT WITH EMPLOYEE'S SCHEDULES, GSA IS BEING
ADVISED TO PAY ADDITIONAL COMPENSATION PROVIDED IT CONCURS WITH PERIODS
OF OVERTIME WORKED AS SHOWN ON EMPLOYEE'S SCHEDULES.
TO MR. DAVID M. HENDRICKS:
WE REFER TO YOUR LETTER OF JULY 28, 1969, IN FURTHER REFERENCE TO
YOUR CLAIM FOR OVERTIME COMPENSATION AS A WAGE BOARD EMPLOYEE OF THE
GENERAL SERVICES ADMINISTRATION (GSA), REGION 6, KANSAS CITY, MISSOURI,
DURING THE PERIOD MARCH 29, 1964, THROUGH JANUARY 9, 1968. THE CLAIM
WAS DISALLOWED BY OFFICE SETTLEMENT OF JUNE 11, 1969, AND YOU NOW HAVE
SUBMITTED GRAPHIC ILLUSTRATIONS OF THE HOURS WORKED DURING THE YEARS
1964 THROUGH 1967 AND HAVE PRESENTED NUMEROUS QUESTIONS CONCERNING THE
VALIDITY OF THE PRACTICE OF GSA IN SCHEDULING WORK ASSIGNMENTS,
PARTICULARLY IN THE CASE OF EMPLOYEES ASSIGNED TO THE SO CALLED "FOURTH
SHIFT" .
AT THE OUTSET IT IS NECESSARY TO POINT OUT THE "REGULAR HOURS OF
WORK" REFERRED TO IN 5 U.S.C. 6102, WHICH IS APPLICABLE TO WAGE BOARD
EMPLOYEES, MEANS, IN THE OPINION OF THIS OFFICE, NOTHING MORE THAN THOSE
HOURS OF WORK, NOT IN EXCESS OF 8 PER DAY OR 40 PER WEEK, FOR WHICH
BASIC COMPENSATION IS PAYABLE AS DISTINGUISHED FROM THOSE ADDITIONAL
HOURS PER DAY OR PER WEEK FOR WHICH OVERTIME RATES ARE PAYABLE. WE DO
NOT CONSTRUE THE TERM "REGULAR HOURS OF WORK" AS REQUIRING THAT AN
EMPLOYEE'S BASIC WORKWEEK CONSIST OF THE SAME HOURS EACH DAY OR THE SAME
DAYS EACH WEEK.
THE PROVISIONS CONTAINED IN 5 U.S.C. 6101 DO NOT APPLY TO WAGE BOARD
EMPLOYEES. HOWEVER, WE UNDERSTAND THAT AS A MATTER OF PRACTICE GSA HAS,
IN EFFECT, ADOPTED THE PROVISIONS IN 6101 FOR APPLICATION TO ITS WAGE
BOARD EMPLOYEES. FOR CONVENIENCE THOSE PROVISIONS ARE QUOTED AS
FOLLOWS:
"SEC. 6101. BASIC 40-HOUR WORKWEEK; WORK SCHEDULES; REGULATIONS
"/A) (1)
"/2) THE HEAD OF EACH EXECUTIVE AGENCY, MILITARY DEPARTMENT AND OF
THE GOVERNMENT OF THE DISTRICT OF COLUMBIA SHALL---
"/A) ESTABLISH A BASIC ADMINISTRATIVE WORKWEEK OF 40 HOURS FOR EACH
FULL-TIME EMPLOYEE IN HIS ORGANIZATION; AND
"/B) REQUIRE THAT THE HOURS OF WORK WITHIN THAT WORKWEEK BE PERFORMED
WITHIN A PERIOD OF NOT MORE THAN 6 OF ANY 7 CONSECUTIVE DAYS.
"/3) EXCEPT WHEN THE HEAD OF AN EXECUTIVE AGENCY, A MILITARY
DEPARTMENT, OR OF THE GOVERNMENT OF THE DISTRICT OF COLUMBIA DETERMINES
THAT HIS ORGANIZATION WOULD BE SERIOUSLY HANDICAPPED IN CARRYING OUT ITS
FUNCTIONS OR THAT COSTS WOULD BE SUBSTANTIALLY INCREASED, HE SHALL
PROVIDE, WITH RESPECT TO EACH EMPLOYEE IN HIS ORGANIZATION, THAT---
"/A) ASSIGNMENTS TO TOURS OF DUTY ARE SCHEDULED IN ADVANCE OVER
PERIODS OF NOT LESS THAN 1 EEK;
"/B) THE BASIC 40-HOUR WORKWEEK IS SCHEDULED ON 5 DAYS, MONDAY
THROUGH FRIDAY WHEN POSSIBLE, AND THE 2 DAYS OUTSIDE THE BASIC WORKWEEK
ARE CONSECUTIVE;
"/C) THE WORKING HOURS IN EACH DAY IN THE BASIC WORKWEEK ARE THE
SAME;
"/D) THE BASIC NONOVERTIME WORKDAY MAY NOT EXCEED 8 HOURS;
"/E) THE OCCURRENCE OF HOLIDAYS MAY NOT AFFECT THE DESIGNATION OF THE
BASIC WORKWEEK; AND
"/F) BREAKS IN WORKING HOURS OF MORE THAN 1 HOUR MAY NOT BE SCHEDULED
IN A BASIC WORKDAY.'
YOU WILL NOTE THAT THE PROVISIONS OF (A) (2) QUOTED ABOVE ARE
MANDATORY, WHEREAS THE PROVISIONS IN (A) (3) ARE FOR APPLICATION EXCEPT
WHEN THE HEAD OF AN AGENCY DETERMINES THAT HIS ORGANIZATION WOULD BE
SERIOUSLY HANDICAPPED IN CARRYING OUT ITS FUNCTIONS OR THAT COSTS WOULD
BE SUBSTANTIALLY INCREASED IF SUCH PROVISIONS ARE APPLIED.
WE UNDERSTAND THAT GSA ESTABLISHED THE FOURTH SHIFT, WHICH IS AN
UNCOMMON TOUR OF DUTY, BASICALLY AS A RELIEF GROUP. A FOURTH SHIFT
EMPLOYEE WILL RELIEVE EMPLOYEES ON THE 3 BASIC DUTY SHIFTS OF 8 HOURS
DURATION. IT HAS BEEN DETERMINED ADMINISTRATIVELY THAT THIS SHIFT IS
ESSENTIAL TO ECONOMIC OPERATION OF THE AGENCY AND IS REQUIRED TO PROVIDE
CONTINUOUS COVERAGE IN THE OPERATIONS OF FEDERAL BUILDINGS. IN SUCH
CONNECTION, THE ADMINISTRATION REPORTS THAT SUCH UNCOMMON TOURS HAVE
BEEN DETERMINED TO BE ESSENTIAL TO THE OPERATION OF THE AGENCY AND MUST
BE CONTINUED. THE REPORT SAYS THAT TO DO OTHERWISE WOULD BE
UNECONOMICAL IN THAT ADDITIONAL MECHANICS AND FUNDS WOULD BE REQUIRED.
IT IS CLEAR THAT UNDER THE STATUTE (6101 (A) (3) (, AS ADMINISTRATIVELY
ADOPTED, THAT THE ADMINISTRATOR OF GSA HAS THE AUTHORITY TO DETERMINE
FOR WAGE BOARD EMPLOYEES THAT EXCEPTIONS TO THE VARIOUS REQUIREMENTS SET
FORTH IN CLAUSES (A) THROUGH (F) OF PARAGRAPH (3) ARE NECESSARY IN THE
GOVERNMENT'S INTEREST. IT IS EQUALLY CLEAR FROM THE INFORMATION BEFORE
THIS OFFICE THAT THE ADMINISTRATOR HAS SO DETERMINED. SUCH
DETERMINATION IS A MATTER WITHIN THE JURISDICTION OF THE AGENCY HEAD AND
NOT THE GENERAL ACCOUNTING OFFICE. THUS, WE MUST CONCLUDE THAT A
FAILURE ON THE PART OF THE REGIONAL OFFICE IN WHICH YOU WERE EMPLOYED TO
SCHEDULE WORK IN ACCORDANCE WITH THE CLAUSES (A) THROUGH (F) OF
PARAGRAPH (3) DOES NOT CONSTITUTE A BASIS FOR PAYMENT OF OVERTIME
COMPENSATION IN YOUR CASE AND THE CASES OF EMPLOYEES SIMILARLY SITUATED.
WE HAVE EXAMINED CAREFULLY THE ENCLOSURES TRANSMITTED WITH YOUR
LETTER AND WE FIND THAT IN MOST INSTANCES THERE APPEARS NO BASIS FOR THE
PAYMENT OF OVERTIME COMPENSATION. THE SPECIFIC SITUATIONS HEREINAFTER
DISCUSSED COVER PERTINENT ITEMS FOR THE YEAR 1964 TO WHICH YOU REFER.
IN SITUATIONS SUCH AS THAT TO WHICH YOU REFER ON PAGE 2 OF YOUR LETTER
RELATING TO P3, WHEN ON FRIDAY, FEBRUARY 7, THE ADMINISTRATIVE OFFICE
CHANGED THE HOURS OF YOUR WORKDAY FROM 7 A.M. -- 3 P.M. TO 11 P.M.
FRIDAY TO 7 A.M. THE FOLLOWING MORNING (SATURDAY) WE DO NOT CONSIDER
THAT SUCH CHANGE CONSTITUTES A BASIS FOR THE GRANTING OF COMPENSATORY
TIME IN LIEU OF THE PAYMENT OF OVERTIME COMPENSATION AS CONTENDED BY
YOU. ACCORDINGLY, AND SINCE YOU WORKED NO MORE THAN 40 HOURS IN THE
WORKWEEK COMMENCING SUNDAY AND ENDING SATURDAY, AND NO MORE THAN 8 HOURS
ON ANY DAY IN SUCH WORKWEEK, THERE IS NO BASIS FOR THE PAYMENT OF
OVERTIME COMPENSATION.
AT THIS POINT WE MIGHT ADD THAT AFTER AN EXAMINATION OF THE
INFORMATION PRESENTED HERE IT APPEARS TO US THAT THE BASIC
ADMINISTRATIVE WORKWEEK FOR GENERAL SERVICES EMPLOYEES IS THE CALENDAR
WEEK, SUNDAY THROUGH SATURDAY. THE FACT THAT AN EMPLOYEE MAY NOT WORK
THE SAME HOURS EACH DAY DOES NOT ENTITLE HIM TO ANY ADDITIONAL BENEFITS
SO LONG AS HE DOES NOT WORK MORE THAN 8 HOURS ON ANY DAY OF 40 HOURS IN
ANY WEEK. THIS IS THE SITUATION EVIDENCED BY THE FIRST ADMINISTRATIVE
WORKWEEK IN THE 10TH AND 13TH PAY PERIODS, AND THUS THERE WOULD NOT BE
ANY ENTITLEMENT TO OVERTIME. HOWEVER, THE RECORDS FURNISHED BY YOU
INDICATE THAT IN THE SECOND ADMINISTRATIVE WORKWEEK OF THE 13TH PAY
PERIOD THE AGENCY VIOLATED THE PROVISIONS IN 5 U.S.C. 6101 (A) (2) (B)
IN FAILING TO ESTABLISH THE WORK PERIOD OVER A PERIOD CONSISTING OF NOT
MORE THAN 6 OF 7 CONSECUTIVE DAYS. HOWEVER, THERE IS NO BASIS FOR
PAYMENT FOR THE 7TH DAY'S WORK AT TIME AND ONE-HALF SINCE NO MORE THAN
40 HOURS WORK WAS PERFORMED IN A WEEK, NOR 8 HOURS IN ANY PARTICULAR
DAY. THE SAME APPEARS TO BE TRUE IN THE CASE OF THE 14TH PAY PERIOD.
CONCERNING THE 15TH PAY PERIOD, IT APPEARS FROM THE RECORDS SUBMITTED BY
YOU THAT THE AGENCY WAS IN ERROR IN SCHEDULING ONLY 32 HOURS IN THE
FIRST ADMINISTRATIVE WORKWEEK AND THAT THE 8 HOURS WERE NOT MADE UP
UNTIL THE SECOND WORKWEEK IN THE 16TH PAY PERIOD WHEREIN YOU APPARENTLY
WORKED 48 HOURS. THUS, IT APPEARS FROM THOSE RECORDS THAT YOU WOULD BE
ENTITLED TO OVERTIME COMPENSATION RATHER THAN STRAIGHT TIME COMPENSATION
FOR THE EXTRA 8 HOURS WORKED IN THE SECOND ADMINISTRATIVE WORKWEEK OF
THE 16TH PAY PERIOD. IN PAY PERIODS 20 AND 21, SINCE YOU WORKED NEITHER
MORE THAN 40 HOURS PER WEEK NOR 8 HOURS ON ANY DAY, WE FIND NO BASIS FOR
PAYMENT OF OVERTIME. A SIMILAR CONCLUSION IS REQUIRED WITH RESPECT TO
PAY PERIOD 22. WE FIND FROM THE RECORDS SUBMITTED BY YOU THAT AN ERROR
OCCURRED IN SCHEDULING THE WORK IN THE SECOND ADMINISTRATIVE WORKWEEK OF
PAY PERIOD 23 IN THAT ONLY 33 HOURS OF WORK WAS SCHEDULED, THE EXTRA 7
HOURS BEING INCLUDED IN THE SECOND WORKWEEK OF PAY PERIOD 24 WHEN YOU
WORKED 47 HOURS. THUS, 7 OF THOSE HOURS WORKED IN THE SECOND
ADMINISTRATIVE WORKWEEK OF THE 24TH PAY PERIOD WOULD APPEAR TO BE
COMPENSABLE AT THE OVERTIME RATE RATHER THAN AT THE STRAIGHT TIME RATE.
WE SEE NO BASIS FOR PAYMENT OF CALL-BACK OVERTIME FOR 2 HOURS ON
SATURDAY, DECEMBER 12, SINCE THE 1 HOUR WORKED BETWEEN 11 P.M. AND 12
MIDNIGHT WAS NOT OVERTIME WORK AND APPARENTLY WAS SCHEDULED IN ADVANCE.
GSA HAS FORWARDED TIME AND ATTENDANCE RECORDS WHICH APPEAR TO BE
INCONSISTENT WITH THE INFORMATION SET FORTH IN YOUR SCHEDULES.
THEREFORE, WE ARE FORWARDING A COPY OF THIS LETTER TO GSA AND SUGGESTING
THAT YOU CONTACT THAT ADMINISTRATION WITH A VIEW TOWARD OBTAINING AN
AGREEMENT ON THE FACTS AS TO WHEN AND WHETHER OVERTIME WAS WORKED. IN
SUCH CONNECTION THE ADMINISTRATION IS BEING ADVISED TO PAY ADDITIONAL
COMPENSATION IN ACCORDANCE WITH A COPY OF THIS LETTER, PROVIDED IT
CONCURS IN THE SCHEDULES YOU TRANSMITTED HERE CONCERNING THE OVERTIME
WORKED DURING PAY PERIODS 16 AND 24 AS SHOWN ON YOUR SCHEDULES. A COPY
OF OFFICE LETTER OF TODAY TO MR. JEFFREY HILLELSON, REGIONAL
ADMINISTRATOR, GSA, IS ENCLOSED. MR. JEFFREY P. HILLELSON REGIONAL
ADMINISTRATOR GENERAL SERVICES ADMINISTRATION, REGION 6 1500 EAST
BANNISTER ROAD KANSAS CITY, MISSOURI 64131
DEAR MR. HILLELSON:
WE REFER TO YOUR LETTER OF SEPTEMBER 26, 1969, CONCERNING THE CASE OF
DAVID M. HENDRICKS AND OTHER EMPLOYEES OF YOUR REGION. IN CONNECTION
THEREWITH, WE ARE ENCLOSING A COPY OF OFFICE LETTER OF TODAY TO MR.
HENDRICKS. WE NOTE THAT CERTAIN RECORDS FURNISHED THIS OFFICE BY YOUR
REGION APPEAR TO BE INCONSISTENT WITH THE INFORMATION SHOWN ON RECORDS
FURNISHED BY MR. HENDRICKS WHICH APPARENTLY WERE OBTAINED FROM THE
FEDERAL RECORDS CENTER, KANSAS CITY, MISSOURI. WE HAVE SUGGESTED THAT
MR. HENDRICKS GET IN TOUCH WITH THE GENERAL SERVICES ADMINISTRATION
(GSA) AND RESOLVE ANY CONFLICTS THAT MAY EXIST IN THE RECORDS AS TO THE
TIME ACTUALLY WORKED BY THE EMPLOYEES IN QUESTION, AND THAT IF THE
INFORMATION CONTAINED IN THE RECORDS FORWARDED HERE BY MR. HENDRICKS,
COPIES OF WHICH HAVE BEEN FURNISHED YOUR OFFICE AS ENCLOSURES TO OUR
LETTER OF AUGUST 21, 1969, B-167322, ARE CORRECT THAT MR. HENDRICKS BE
PAID OVERTIME COMPENSATION TO THE EXTENT INDICATED IN THE ATTACHED COPY
OF OFFICE LETTER OF TODAY TO MR. HENDRICKS. IF COMPARABLE SITUATIONS
OCCURRED WITH RESPECT TO ANY OF THE OTHER EMPLOYEES INVOLVED, THEY TOO
SHOULD BE PAID OVERTIME ON SUCH OCCASIONS. IT IS REQUESTED FURTHER THAT
WE BE ADVISED OF YOUR FINAL DETERMINATIONS IN THESE MATTERS.
B-167446, OCT. 31, 1969
SPECIFICATIONS--MINIMUM NEEDS REQUIREMENT--ADMINISTRATIVE DETERMINATION
UNSUCCESSFUL OFFEROR'S PROTEST TO AWARD FOR WHOLE BLOOD SHIPPING
CONTAINERS IS DENIED SINCE OFFEROR'S CONTAINER WAS AT VARIANCE WITH
SPECIFICATIONS AND NONRESPONSIVE. RESPONSIBILITY OF DRAFTING
SPECIFICATIONS TO REFLECT MINIMUM NEEDS OF GOVERNMENT AND WHETHER
ARTICLES OFFERED BY BIDDERS ADEQUATELY MEET SPECIFICATIONS IS PRIMARILY
FOR DETERMINATION BY ADMINISTRATIVE AGENCY CONCERNED, IT IS GAO'S DUTY
TO DETERMINE ONLY WHETHER SPECIFICATIONS ARE UNDULY RESTRICTIVE OF
COMPETITION AND INABILITY OR UNWILLINGNESS OF BIDDER TO MEET MINIMUM
REQUIREMENTS IS NOT SUFFICIENT TO WARRANT CONCLUSION OF RESTRICTIVENESS
BUT, SINCE TWO-STEP PROCUREMENT WILL BE INITIATED BASED ON PERFORMANCE
SPECIFICATIONS, OFFEROR SHOULD HAVE OPPORTUNITY TO OFFER ANY CONTAINER
IT BELIEVES WILL MEET REQUIRED PERFORMANCE.
TO PHILLIPS-FOSCUE CORPORATION:
FURTHER REFERENCE IS MADE TO YOUR PROTEST AGAINST THE AWARD OF A
CONTRACT TO LIFE-LIKE PRODUCTS, INC., BY THE DEFENSE PERSONNEL SUPPORT
CENTER, PHILADELPHIA, PENNSYLVANIA, PURSUANT TO SOLICITATION NO.
DSA-120-69-R-3915, FOR THE PROCUREMENT OF WHOLE BLOOD SHIPPING
CONTAINERS.
THE SUBJECT SOLICITATION, A TOTAL SMALL BUSINESS SET-ASIDE, WAS
ISSUED ON JUNE 30, 1969, WITH AN OPENING DATE, AS AMENDED, OF JULY 24,
1969, AND CALLED FOR BIDS ON A QUANTITY OF 13,800 CONTAINERS IN
ACCORDANCE WITH DEFENSE MEDICAL PURCHASE DESCRIPTION NO. 1, DATED MAY
12, 1969, FEDERAL STOCK NO. 8115-935-9761, INCLUDED IN THE SOLICITATION
PACKAGE. THE SOLICITATION INCLUDED A REQUIREMENT FOR FIRST ARTICLE
APPROVAL OR WAIVER OF THE REQUIREMENT UNDER STATED CIRCUMSTANCES AND
REQUIRED DELIVERIES TO COMMENCE WITHIN 120 DAYS FROM DATE OF AWARD AND
BE COMPLETED WITHIN 240 DAYS THEREAFTER. THE SOLICITATION ALSO INCLUDED
A 50 PERCENT INCREASE OPTION PROVISION. FIVE OFFERS WERE RECEIVED AND
AWARD WAS MADE TO LIFE-LIKE PRODUCTS ON AUGUST 29, 1969, AT A UNIT PRICE
OF $3.55. YOUR OFFER WAS THIRD LOWEST AT $4.09. HOWEVER, YOUR OFFER WAS
BASED ON A CONTAINER AT VARIANCE WITH THE STATED SPECIFICATIONS AND,
THEREFORE, NONRESPONSIVE.
THE SUBSTANCE OF YOUR PROTEST IS CONTAINED IN THE FOLLOWING QUOTATION
FROM YOUR LETTER OF JULY 10, 1969: "IN ESSENCE, THESE DOCUMENTS SHOW
THAT: 1) THE BLOOD SHIPPING CONTAINER WAS DESIGNED IMPROPERLY AND
WITHOUT CONSULTATION WITH GOVERNMENT TECHNICAL PACKAGING/TRANSPORTATION
PERSONNEL OR WITH INDUSTRY; 2) THE PROCUREMENT WAS MADE OVER INDUSTRY
PROTESTS EVEN THOUGH PHILLIPS-FOSCUE OFFERED A CONTAINER FOR LESS MONEY,
A FASTER DELIVERY, AND A GUARANTEED PERFORMANCE THAT CONFORMED TO THE
LONGSTANDING DPSC SPECIFICATION FOR THERMAL CONTAINERS-MEDICAL MATERIAL;
3) THE FIRST ARTICLE QUALIFICATION TESTS COMPLETELY FAILED AS PREDICTED
BY INDUSTRY; 4) THE MEDICAL PROFESSIONALS THEN WAIVED ALL PERFORMANCE
REQUIREMENTS OF THE CONTAINER UNDER CONTRACT; AND 5) DSA REJECTED
INDUSTRY OBJECTIONS AND FELT THEIR HANDLING OF THE MATTER WAS IN KEEPING
WITH GOOD BUSINESS PRACTICE AND INDUSTRY RELATIONS.' THE "DOCUMENTS"
REFERRED TO IN THE ABOVE QUOTATION ARE YOUR LETTERS AND DEPARTMENT OF
DEFENSE REPLIES THERETO, AS WELL AS YOUR HISTORY OF PROCUREMENT OF THE
CONTAINERS. IN ADDITION, YOUR CORRESPONDENCE DETAILS THE DESIGN
FEATURES WHICH YOU CONTEND ARE RESTRICTIVE AND INEFFICIENT AND YOUR
OBJECTIONS TO THE PERFORMANCE REQUIREMENTS WHICH YOU CONTEND ARE"MODEST"
AND BELOW THE CAPABILITY OF INDUSTRY.
YOU ALSO CONTEND THAT PREVIOUS SUPPLIERS OF THE CONTAINER WERE
FAVORED BY THE FAILURE OF THE SOLICITATION PACKAGE TO INCLUDE REFERENCED
DRAWINGS, THE SHORT PERIOD ALLOWED FOR SUBMISSION OF OFFERS, AND THE
PROVISION FOR WAIVING FIRST ARTICLE APPROVAL. YOU ALSO OBJECT TO THE
SMALL BUSINESS SIZE STANDARD OF 500 EMPLOYEES AND CONTEND THAT 250
EMPLOYEES WOULD BE MORE MEANINGFUL IN RESTRICTING THE PROCUREMENT TO
SMALL BUSINESS CONCERNS. IN ADDITION, YOU CONTEND THAT THE SUBJECT
PROCUREMENT IS CONTRARY TO THE ASSURANCE YOU RECEIVED FROM THE ASSISTANT
SECRETARY OF THE DEPARTMENT OF DEFENSE, INSTALLATIONS AND LOGISTICS, AT
THE TIME OF THE LAST PROCUREMENT OF THE CONTAINERS THAT THE NEXT
PROCUREMENT WOULD NOT USE THE "JAPANESE DESIGN," BUT WOULD FOLLOW
TWO-STEP PROCEDURES.
AFTER YOU WERE FURNISHED A COPY OF THE ADMINISTRATIVE REPORT, YOU
RESPONDED BY REAFFIRMING YOUR POSITION AS SUMMARIZED ABOVE AND STATING
THAT DSA'S EXPLANATION OF ITS HANDLING OF THE PROCUREMENTS OF THESE
CONTAINERS IS INCOMPLETE AND UNSATISFACTORY. YOU REEMPHASIZE YOUR
POSITION THAT THE PRIMARY OBJECTIONS TO YOUR CONTAINER (THE LACK OF
V-GROOVES AND OF A SEPARATE OUTER CONTAINER) ARE NOT VALID AND THAT YOUR
DESIGN IS "LIGHTER IN WEIGHT, HAS FEWER PARTS, IS EASIER TO USE IN THE
FIELD, IS LESS EXPENSIVE ON LIGHT-USE BASIS, BUT MOST IMPORTANTLY
PROVIDES A GREATER DEGREE OF PROTECTION FOR THE WHOLE BLOOD.' FINALLY,
YOU REQUEST OUR OFFICE TO (1) TERMINATE THIS PROCUREMENT, (2) DIRECT DSA
TO PROCURE ONLY A SIX MONTHS' SUPPLY, (3) DIRECT THAT THE FORTHCOMING
TWO-STEP PROCUREMENT BE OPEN TO ALL BIDDERS WHO CAN MEET A GIVEN
PERFORMANCE STANDARD RATHER THAN A RESTRICTED DESIGN, AND (4) DIRECT DOD
TO CONSIDER LIFETIME PROCUREMENT-USE COSTS.
IN RESPONSE TO YOUR PROTEST, DSA HAS FURNISHED OUR OFFICE A
COMPREHENSIVE REPORT OF BOTH THIS AND LAST YEAR'S PROCUREMENTS, AS WELL
AS A HISTORY OF DEVELOPMENT OF THE CONTAINER. IN 1964 THE ARMY'S
MEDICAL EQUIPMENT RESEARCH AND DEVELOPMENT LABORATORY (MERDL) UNDERTOOK
A PROJECT TO DESIGN AND DEVELOP A BLOOD SHIPPING CONTAINER IN ACCORDANCE
WITH PERFORMANCE REQUIREMENTS ESTABLISHED BY THE MILITARY BLOOD PROGRAM
AGENCY. FIFTEEN FIRMS WERE SOLICITED FOR THE R-AND-D CONTRACT AND FIVE
SUBMITTED OFFERS. A CONTRACT WAS AWARDED TO AVCO CORPORATION ON
NOVEMBER 1, 1964, AND TERMINATED IN 1966 BECAUSE AVCO WAS UNABLE TO MEET
THE REQUIREMENTS. IN 1966 DPSC PERSONNEL DISCOVERED THAT A CONTAINER
HAD BEEN DEVELOPED BY AN AMERICAN UNIT STATIONED IN JAPAN. IT WAS FOUND
THAT THIS CONTAINER WAS SUPERIOR TO THE CONTAINER THEN IN USE, ALTHOUGH
NOT UP TO THE EARLIER ESTABLISHED REQUIREMENTS.
AN ALTERNATE DESIGN WAS DEVELOPED BY MERDL IN 1967, AND A PROCUREMENT
BASED ON THIS DESIGN WAS INITIATED IN 1968. HOWEVER, THE RFP WAS
CANCELLED TO EFFECT SOME CHANGES. SOME OF THE CHANGES YOUR FIRM
SUGGESTED WERE ACCEPTED, BUT THE FEATURES YOU OBJECTED TO MOST (THE
INSIDE CONFIGURATION AND DIMENSIONS OF THE INSERT, THE V-GROOVES, AND
THE TWO-BOX CONCEPT) WERE RETAINED. A NEW SOLICITATION RESULTED IN AN
AWARD TO RADVA PLASTICS CORPORATION. YOUR OFFER WAS NONRESPONSIVE TO
THE SPECIFICATIONS. RADVA'S FIRST ARTICLE DID NOT MEET ALL OF THE TEST
REQUIREMENTS. IT DID NOT MEET THE SPECIFIED TEMPERATURE EXCEPT IN THE
CENTER POSITION THERMOCOUPLE. NONE OF THE OTHER BOXES TESTED BY MERDL,
AT THAT TIME OR AS LATE AS JULY 1969, INCLUDING YOURS AND THE "JAPANESE"
CONTAINER, HAVE MET THE TEMPERATURE REQUIREMENTS. HOWEVER, THE RADVA
CONTAINER PERFORMED AS WELL OR BETTER THAN THE JAPANESE CONTAINER WHICH
HAD PROVEN SATISFACTORY IN SERVICE. THEREFORE, IT WAS ACCEPTED. THE
PRESENT PROCUREMENT IS BASED ON ESSENTIALLY THE SAME SPECIFICATIONS AND
PERFORMANCE REQUIREMENTS AS ACCEPTED UNDER THE RADVA CONTRACT.
THE DSA REPORT INCLUDES SPECIFIC REPLIES TO VARIOUS COMPLAINTS MADE
BY YOU. THESE ARE SUMMARIZED BELOW. THE CONTAINER WHICH IS CALLED FOR
UNDER THE PRESENT SPECIFICATIONS NEEDS 12 POUNDS OF ICE RATHER THAN 20
POUNDS. ALTHOUGH YOUR CONTAINERS ARE SMALLER AND REQUIRE LESS ICE, THEY
ARE NOT EQUAL IN PERFORMANCE TO THE DPSC CONTAINER AS DETERMINED BY TWO
DIFFERENT EVALUATIONS.
IN ADDITION TO BETTER TEMPERATURE HOLDING CAPABILITY, THE DPSC
CONTAINER BETTER PROTECTS THE BLOOD BAGS FROM DAMAGE. THE CLOSING DATE
WAS EXTENDED FROM JULY 15 TO JULY 24 BECAUSE ANOTHER FIRM WAS ALSO
HAVING TROUBLE GETTING COPIES OF THE DRAWINGS, WHICH ARE NOT NORMALLY
INCLUDED IN THE RFP. HOWEVER, THE RFP INCLUDED INFORMATION AS TO WHERE
THEY COULD BE OBTAINED. WAIVER OF FIRST ARTICLE APPROVAL IS AUTHORIZED
BY THE ARMED SERVICES PROCUREMENT REGULATION, AND WAS INCLUDED IN THE
RFP AS A MEANS OF POSSIBLY EFFECTING A SAVING TO THE GOVERNMENT. THERE
ARE NO SMALL BUSINESS SIZE STANDARDS OF LESS THAN 500 EMPLOYEES. THE
REQUIREMENT FOR V-GROOVES IN THE CONTAINER WAS RETAINED BECAUSE TESTING
INDICATES, ALTHOUGH NOT CONCLUSIVELY, THAT AIR CIRCULATION HELPS
MAINTAIN A CONSTANT TEMPERATURE THROUGHOUT THE CONTAINER. IT IS FELT
THAT THIS ADVANTAGE MORE THAN OFFSETS ANY REDUCED INSULATING CAPACITY OR
WEAKENING OF THE CONTAINER. THE INSERT CONCEPT WAS RETAINED FOR REASONS
OF SANITATION AND CLEANLINESS, AND THE OUTER FIBERBOARD BOX ALSO
PROVIDES ADDITIONAL PROTECTION FOR THE BLOOD BAGS. REMOVAL OF THE OUTER
CONTAINER AT THE POINTS OF DESTINATION HELPS THE USING ACTIVITIES
PREVENT SOILING AND CONTAMINATION OF BOTH THE BLOOD SUPPLY AND THE
REFRIGERATORS.
WITH REGARD TO THE CONTENTION THAT YOU WERE TOLD A YEAR AGO THAT THE
NEXT PROCUREMENT OF THIS ITEM WOULD BE EFFECTED UNDER TWO-STEP
PROCEDURES, WE NOTE THAT THE LETTER OF JULY 6, 1968, FROM THE OFFICE OF
THE ASSISTANT SECRETARY OF DEFENSE, INSTALLATIONS AND LOGISTICS, STATES
ONLY THAT THE ARMY MEDICAL RESEARCH AND DEVELOPMENT COMMAND IS
CONDUCTING A REVIEW OF THE TYPE OF CONTAINER TO BE USED BY THE MILITARY.
THE RESPONSIBILITY FOR DRAFTING PROPER SPECIFICATIONS WHICH REFLECT
THE MINIMUM NEEDS OF THE GOVERNMENT AND FOR DETERMINING FACTUALLY
WHETHER ARTICLES OFFERED BY BIDDERS MEET THESE SPECIFICATIONS IS
PRIMARILY THAT OF THE ADMINISTRATIVE AGENCY CONCERNED. 17 COMP. GEN.
554 (1938).
WHILE IT IS THE DUTY OF OUR OFFICE TO DETERMINE WHETHER
SPECIFICATIONS AS WRITTEN ARE UNDULY RESTRICTIVE OF COMPETITION, THE
FACT THAT A PARTICULAR BIDDER MAY BE UNABLE OR UNWILLING TO MEET THE
MINIMUM REQUIREMENTS FOR SUPPLYING THE GOVERNMENT'S NEEDS IS NOT
SUFFICIENT TO WARRANT THE CONCLUSION THAT THE SPECIFICATIONS ARE UNDULY
RESTRICTIVE. 36 COMP. GEN. 251 (1956). BASED ON THE RECORD BEFORE OUR
OFFICE, WE ARE UNABLE TO CONCLUDE THAT THE SPECIFICATIONS OF THE SUBJECT
SOLICITATION WERE UNDULY RESTRICTIVE, OR THAT THERE WAS ANY IMPROPRIETY
IN THE ESTABLISHMENT OF THOSE SPECIFICATIONS. THEREFORE, THERE IS NO
BASIS FOR OUR OFFICE TO DISTURB THE CONTRACT AWARDED TO LIFE-LIKE
PRODUCTS, INC.
WITH REGARD TO FUTURE PROCUREMENTS OF THIS ITEM, WE NOTE THAT IN A
LETTER DATED AUGUST 19, 1969, THE OFFICE OF THE ASSISTANT SECRETARY OF
DEFENSE, INSTALLATIONS AND LOGISTICS, HAS STATED THAT A TWO-STEP
PROCUREMENT WOULD BE INITIATED ABOUT THE MIDDLE OF SEPTEMBER 1969, AND
THAT IT WOULD BE BASED UPON PERFORMANCE SPECIFICATIONS. THEREFORE, YOU
SHOULD HAVE AN OPPORTUNITY TO OFFER ANY CONTAINER YOU BELIEVE WILL MEET
THE REQUIRED PERFORMANCE. WE BELIEVE THIS IS A PROPER COURSE OF ACTION
IN VIEW OF THE CLAIMS YOU HAVE MADE AS TO THE SUPERIORITY OF YOUR
CONTAINERS.
IN THESE CIRCUMSTANCES, WE FIND NO BASIS TO TAKE EXCEPTION TO THIS
PROCUREMENT.
B-167774, OCT. 31, 1969
RATION COMMUTATION PAYMENTS--AUTHORIZATION--FAILURE OF COMMANDING
OFFICER
AIR FORCE MEMBER'S CLAIM FOR SEPARATE RATION ALLOWANCE, PREVIOUSLY
DISALLOWED FOR RECORD'S FAILURE TO EVIDENCE AUTHORIZATION BY PROPER
AUTHORITY FOR MEMBER TO MESS SEPARATELY OR ANY OFFICIAL DOCUMENTS
SUPPORTING CLAIM, IS AGAIN DENIED, AS NO FAVORABLE ACTION MAY BE TAKEN
UNTIL IT IS ESTABLISHED MEMBER WAS GIVEN OFFICIAL PERMISSION TO MESS
SEPARATELY BY OFFICER VESTED WITH AUTHORITY TO GRANT SUCH PERMISSION;
IF OFFICER'S STATEMENT FURNISHED IS ACCEPTED AS ESTABLISHING THAT HE
VERBALLY AUTHORIZED CLAIMANT TO MESS SEPARATELY, FACT REMAINS THAT NO
INFORMATION HAS BEEN FURNISHED SHOWING AUTHORITY HAD BEEN DELEGATED TO
OFFICER TO PERMIT ENLISTED MEN TO MESS SEPARATELY, AND IN SUCH
CIRCUMSTANCES NO AUTHORITY EXISTS FOR PAYMENT OF CLAIM.
TO SENIOR MASTER SERGEANT WALTER WANZENRIED:
REFERENCE IS MADE TO A LETTER DATED AUGUST 13, 1969, FROM CAPTAIN
EDWIN H. BALCH, USAF, ASSISTANT STAFF JUDGE ADVOCATE, FAIRCHILD AIR
FORCE BASE, WASHINGTON, REQUESTING RECONSIDERATION OF YOUR CLAIM FOR
SEPARATE RATION ALLOWANCE.
YOU STATED IN YOUR CLAIM THAT WHEN YOU ARRIVED AT FAIRCHILD AIR FORCE
BASE FROM A TOUR OF DUTY IN SOUTHEAST ASIA AND REPORTED TO THE 92D
SECURITY POLICE SQUADRON ON JANUARY 7, 1967, YOU WERE IMMEDIATELY
ASSIGNED QUARTERS FOR YOU AND YOUR DEPENDENTS, BUT THAT AN AF FORM 220,
REQUEST FOR BASIC ALLOWANCE FOR SUBSISTENCE, WAS NOT "INITIATED" AT THAT
TIME. ALSO, YOU SAY THAT SINCE WHILE SERVING OUTSIDE THE UNITED STATES
YOU HAD BEEN RECEIVING CERTAIN OTHER ALLOWANCES WHICH WERE NOT PAYABLE
IN THE UNITED STATES, YOU DID NOT REALIZE RIGHT AWAY THAT YOU WERE NOT
RECEIVING SUBSISTENCE ALLOWANCE. YOU HAVE NOT BEEN CREDITED WITH THAT
ALLOWANCE (SEPARATE RATIONS) BETWEEN JANUARY 7, 1967, AND SEPTEMBER 30,
1968.
AN INVESTIGATION WHICH WAS CONDUCTED FAILED TO REVEAL A REQUEST FOR
SEPARATE RATIONS, OR ANY OTHER OFFICIAL DOCUMENTS TO SUPPORT YOUR CLAIM.
HENCE, IT WAS DISALLOWED BY SETTLEMENT OF OUR CLAIMS DIVISION DATED
JULY 28, 1969, FOR THE REASON THAT THERE IS NO RECORD OF ANY EVIDENCE
THAT YOU WERE AUTHORIZED BY THE PROPER AUTHORITY TO MESS SEPARATELY.
YOU HAVE FURNISHED A STATEMENT DATED MAY 2, 1969, SIGNED BY
LIEUTENANT COLONEL ERIC COURTNEY, USAF, RETIRED, IN WHICH HE AVERS THAT
AS COMMANDER OF THE 92D COMBAT DEFENSE SQUADRON AT YOUR NEW STATION HE
INTERVIEWED YOU ON JANUARY 10, 1967, AND INFORMED YOU THAT YOU WERE
"QUALIFIED TO RECEIVE SEPARATE RATIONS AND THE NECESSARY PAPERWORK WOULD
BE INITIATED.'
SECTION 402 (B), TITLE 37, U.S. CODE, AUTHORIZES THE PAYMENT OF A
BASIC ALLOWANCE FOR SUBSISTENCE ON A DAILY BASIS TO ENLISTED MEMBERS OF
THE ARMED SERVICES "WHEN PERMISSION TO MESS SEPARATELY IS GRANTED.'
PARAGRAPH 10425 (B), AFM 177-105, CHANGE 14, JUNE 15, 1966, IN EFFECT AT
THE TIME OF YOUR ASSIGNMENT TO THE 92D SECURITY POLICE SQUADRON,
PROVIDES THAT PERMISSION TO MESS SEPARATELY MAY BE GRANTED BY THE
COMMANDER OF ONE OF THE MAJOR COMMANDS THERE LISTED OR THAT SUCH
AUTHORITY MAY BE REDELEGATED TO SQUADRON COMMANDERS.
NO FAVORABLE ACTION MAY BE TAKEN ON YOUR CLAIM UNTIL IT IS
ESTABLISHED THAT YOU WERE GIVEN OFFICIAL PERMISSION TO MESS SEPARATELY
BY AN OFFICER TO WHOM SUCH AUTHORITY HAD BEEN PROPERLY DELEGATED. IF
COLONEL COURTNEY'S STATEMENT OF MAY 2, 1969, IS ACCEPTED AS ESTABLISHING
THAT HE VERBALLY AUTHORIZED YOU TO MESS SEPARATELY, YOUR ATTENTION IS
INVITED TO THE FACT THAT NO INFORMATION HAS BEEN FURNISHED WHICH SHOWS
THAT AUTHORITY HAD BEEN DELEGATED TO HIM TO PERMIT ENLISTED MEN TO MESS
SEPARATELY. IN SUCH CIRCUMSTANCES, THERE IS NO AUTHORITY FOR THE
PAYMENT OF YOUR CLAIM.
ACCORDINGLY, ON THE PRESENT RECORD, THE SETTLEMENT OF JULY 28, 1969,
IS SUSTAINED.
B-167791, OCT. 31, 1969
SPECIFICATIONS--MINIMUM NEEDS REQUIREMENT--PURCHASE DESCRIPTION V.
MILITARY SPECIFICATIONS
WHERE INVITATION FOR BIDS WAS CANCELED FOR AMBIGUITY OF
SPECIFICATIONS AND NEW INVITATION WAS ISSUED TO INCORPORATE REVISED
DESCRIPTION, INITIAL LOW BIDDER'S PROTEST WAS DENIED SINCE BID WAS
REJECTED BECAUSE EQUIPMENT FAILED TO EQUAL BRAND NAME SPECIFIED THEREIN.
WHILE USE OF MILITARY SPECIFICATIONS IS MANDATORY FOR CERTAIN ITEMS
COVERED BY THAT SPECIFICATION, SUCH USE IS NOT NECESSARY WHEN IT IS
DETERMINED, AS HERE, THAT IT DOES NOT MEET ESSENTIAL NEEDS OF GOVERNMENT
AND SINCE PURCHASE DESCRIPTION WAS AMENDED TO INCLUDE ALL MANUFACTURERS
AND STATED ESSENTIAL CHARACTERISTICS AND FUNCTIONS OF EQUIPMENT NEEDED
BY AGENCY, IT WAS NOT CONSIDERED TO BE RESTRICTIVE AND DID NOT SPECIFY
FEATURES PECULIAR TO PARTICULAR MAKE OF EQUIPMENT.
TO THE AMERICAN TOOL WORKS COMPANY:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF AUGUST 22, 1969, WITH
ENCLOSURES, PROTESTING THE ACTION OF THE DEPARTMENT OF THE ARMY, ROCK
ISLAND ARSENAL, ROCK ISLAND, ILLINOIS, IN CANCELING INVITATION FOR BIDS
(IFB) NO. DAAF01-69-B-0176 AND READVERTISING THE PROCUREMENT UNDER IFB
NO. DAAF01-69-B-0807.
THE ARSENAL ISSUED SOLICITATION NO. DAAF01-69-B-0176 ON OCTOBER 25,
1968, TO 10 PROSPECTIVE BIDDERS FOR THE PROCUREMENT OF SIX EACH:
"LATHE, ENGINE, FLOOR MOUNTED: WITH FOUR WAY POWER RAPID TRAVERSE AND
IN ACCORDANCE WITH TABLE I; AMERICAN TOOL WORKS, INC. MODEL 25 INCH
STYLE E. HEAVY DUTY LATHE; R.K. LEBLOND MACHINE TOOL CO., MODEL 2516 NF
ENGINE LATHE; MONARCH MACHINE TOOL CO., MODEL 2516 SERIES 62 ENGINE
LATHE, OR EQUAL. * * *" THE SOLICITATION SPECIFIED A BID OPENING DATE
OF NOVEMBER 14, 1968. ON NOVEMBER 12, 1968, AMENDMENT 0001 WAS ISSUED
INCREASING THE QUANTITY FROM 6 TO 10 AND EXTENDING THE BID OPENING DATE
TO NOVEMBER 22, 1968.
IT IS REPORTED THAT AS A RESULT OF NUMEROUS QUERIES FROM THE BRAND
NAME LATHE MANUFACTURERS REFERENCED IN THE SCHEDULE ADVISING OF
CONFLICTS BETWEEN DISSIMILAR DESIGN CHARACTERISTICS, AMENDMENT 0002
DATED NOVEMBER 19, 1968, WAS ISSUED TO INCORPORATE A REVISED ITEM
DESCRIPTION, EXTEND THE BID OPENING DATE TO DECEMBER 13, 1968, AND
CHANGE THE BRAND NAME OR EQUAL DESCRIPTION TO THE FOLLOWING: "LATHE,
ENGINE, FLOOR MOUNTED: WITH FOUR WAY POWER RAPID TRAVERSE AND IN
ACCORDANCE WITH TABLE I; MONARCH MACHINE TOOL CO., MODEL 2516 SERIES
612 ENGINE LATHE, OR EQUAL, WITH EQUIPMENT LISTED BELOW IN QUANTITIES OF
ONE EACH. * * * THE REQUIRED SWING OVER THE BID SHALL NOT BE OBTAINED
BY THE USE OF RISER BLOCKS BENEATH THE HEADSTOCK AND TAILSTOCK ON A
BASICALLY SMALLER MACHINE.' AS A RESULT OF COMMENTS RECEIVED FROM THE
LATHE INDUSTRY CONCERNING MOTOR HORSEPOWER AND DUTY CYCLE, AMENDMENT
0003 DATED NOVEMBER 25, 1968, WAS ISSUED TO CLARIFY THE MOTOR
REQUIREMENT BY CHANGING "MOTOR HORSEPOWER 25" TO READ "MOTOR HORSEPOWER
AND DUTY CYCLE 20 CONTINUOUS DUTY.' ON NOVEMBER 29, 1968, AMENDMENT 0004
WAS ISSUED TO CORRECT AN ERRONEOUS "PORT OF LOADING" POINT FROM
,CHARLESTON, WEST VIRGINIA" TO "CHARLESTON, SOUTH CAROLINA.'
THE FOLLOWING THREE BIDS WERE RECEIVED AND OPENED ON DECEMBER 13,
1968:
BIDDER FOB DESTINATION FOB ORIGIN
------ --------------- ---------- THE LODGE
COMPANY NO BID $ 27,419 LUTHER AND PEDERSEN, IN
25,922 MONARCH MACHINE TOOL COMPANY 265,254.00 * 26
CONTRACTING OFFICER CONSIDERED THIS TO BE AN OBVIOUS CLERICAL ERROR
REPRESENTING THE PRICE FOR 10 UNITS RATHER THAN THE UNIT PRICE.
THE RECORD INDICATES THAT LODGE AND SHIPLEY BID ON ITS "2516
POWERTURN" LATHE AS AN EQUAL TO THE SPECIFIED BRAND NAME; THAT MONARCH
BID ON THE SPECIFIED BRAND NAME; AND THAT YOUR DISTRIBUTOR, LUTHER AND
PEDERSEN, BID ON YOUR FIRM'S MODEL 20D2 LATHE AS AN EQUAL TO THE
SPECIFIED BRAND NAME. IT IS REPORTED THAT THE TECHNICAL EVALUATION OF
THE THREE BIDS RESULTED IN A DETERMINATION THAT THE EQUIPMENT OFFERED BY
MONARCH AND LODGE AND SHIPLEY WERE ACCEPTABLE BUT THAT THE EQUIPMENT
OFFERED BY YOUR DISTRIBUTOR, LUTHER AND PEDERSEN, WAS NOT ACCEPTABLE
BECAUSE IT DID NOT MEET THE REQUIREMENTS OF THE SOLICITATION. THE
EQUIPMENT OF YOUR FIRM, WHICH YOUR DISTRIBUTOR OFFERED, WAS FOUND TO BE
UNACCEPTABLE IN THE FOLLOWING AREAS:
AMERICAN
DESCRIPTION MINIMUM REQUIREMENT MODEL 20D2
----------- ------------------- ---------- TOOL POST
7/8 X 1-3/4 5/8 X 1-1/4 FOLLOW REST CAPACITY, RANGE
1/2 TO 4 FACE PLATE, SMALL DIAMETER 12
OF
HOLE THROUGH CENTER 2-1/16 2 HEADS
PER USAS B5.10 NO. 5 NO. 4 TAIL
PER USAS B5.10 NO. 5 NO. 4
THEREAFTER, THE CONTRACTING OFFICER DETERMINED ON FEBRUARY 19, 1969,
THAT SOLICITATION NO. -0176 SHOULD BE CANCELED AND THE REQUIREMENT
RESOLICITED UNDER A NEW PURCHASE DESCRIPTION MORE CLEARLY SETTING FORTH
THE MINIMUM REQUIREMENTS OF THE GOVERNMENT. THE BASIS FOR SUCH
DETERMINATION WAS AS FOLLOWS: "DURING THE PROCESS OF SOLICITATION, FOUR
(4) AMENDMENTS WERE ISSUED IN AN ATTEMPT TO CLARIFY AMBIGUITIES IN THE
-BRAND NAME OR EQUAL- PURCHASE DESCRIPTION. THE FINAL REQUIREMENT
CALLED FOR A MONARCH MACHINE TOOL COMPANY MODEL 2516, SERIES 612 ENGINE
LATHE WITH AN ADDITIONAL TABLE I SETTING FORTH REQUIREMENTS, CAPACITIES
AND CAPABILITIES WHICH WOULD BE CONSIDERED AS A MINIMUM. THIS
APPARENTLY CONFUSED ALL BIDDERS AS TO EXACTLY WHAT THE GOVERNMENT
REQUIREMENTS ARE. IN ADDITION, DURING THE PROCESS OF EVALUATION OF
BIDS, PRON 9-FV013 WAS CANCELLED, REDUCING THE TOTAL QUANTITY OF ENGINE
LATHES TO SEVEN (7).'
BY LETTERS DATED FEBRUARY 20, 1969, THE THREE BIDDERS WERE ADVISED
THAT SOLICITATION NO. -0176 HAD BEEN CANCELED AND THAT IN THE EVENT THE
PROCUREMENT WAS READVERTISED, EACH FIRM WOULD BE GIVEN AN OPPORTUNITY TO
PARTICIPATE IN THE BIDDING. SEE PARAGRAPH 2-404.1 (B) (I) OF THE ARMED
SERVICES PROCUREMENT REGULATION (ASPR) WHICH AUTHORIZES THE CANCELLATION
OF INVITATIONS AFTER BID OPENING IF INADEQUATE OR AMBIGUOUS
SPECIFICATIONS WERE CITED IN THE INVITATION.
ON JUNE 3, 1969, SOLICITATION NO. -0807 WAS ISSUED AND SENT TO 10
PROSPECTIVE BIDDERS REQUESTING BIDS -- TO BE OPENED JUNE 23, 1969 -- FOR
FURNISHING SEVEN ENGINE LATHES WHICH WERE DESCRIBED IN THE SOLICITATION
AS FOLLOWS: "LATHE, ENGINE: IN ACCORDANCE WITH T-AND-E PD-65 DATED 69
APR 08 AND ALL SPECIFICATIONS AS REFERENCED HEREIN.'
BY LETTER DATED JUNE 17, 1969, ADDRESSED TO THE CONTRACTING OFFICER,
YOU PROTESTED AGAINST ANY AWARD BEING MADE UNDER IFB -0807 ON THE GROUND
THAT AN EXISTING MILITARY SPECIFICATION SHOULD HAVE BEEN USED IN THE
SOLICITATION IN LIEU OF A PURCHASE DESCRIPTION WHICH YOU STATED
CONTAINED FEATURES PECULIAR TO THE CLASS OF MACHINE MANUFACTURED BY
MONARCH. DUE TO THE LENGTH OF TIME REQUIRED TO EVALUATE AND ANSWER YOUR
PROTEST, THE CONTRACTING OFFICER ULTIMATELY EXTENDED THE DATE FOR
OPENING OF BIDS TO AUGUST 21, 1969, BY ISSUANCE OF AMENDMENTS NOS. 0001,
0002, AND 0003.
THREE BIDS WERE RECEIVED AND OPENED ON AUGUST 21, 1969. THE PRICES
QUOTED BY THESE BIDDERS WERE AS FOLLOWS:
BIDDER FOB DESTINATION FOB ORIGIN
------ --------------- ---------- LODGE AND
NO BID $30,574 LODGE AND SHIPLEY COMPANY N
27,006 MONARCH MACHINE TOOL COMPANY $26,348 2
NO BID WAS RECEIVED FROM YOUR DISTRIBUTOR, LUTHER AND PEDERSEN. IT
IS REPORTED THAT THE LOWER-PRICED MACHINE OFFERED BY LODGE AND SHIPLEY
DID NOT MEET CERTAIN REQUIREMENTS OF THE SOLICITATION. THE HIGHER BID
SUBMITTED BY LODGE AND SHIPLEY AND THE BID SUBMITTED BY MONARCH HAVE
BOTH BEEN DETERMINED TO BE RESPONSIVE TO THE SOLICITATION. AN AWARD
UNDER THE SUBJECT SOLICITATION IS BEING WITHHELD PENDING A DECISION ON
YOUR PROTEST BY OUR OFFICE.
YOU STATE THAT YOUR DISTRIBUTOR, LUTHER AND PEDERSEN, WAS THE LOW
BIDDER UNDER THE INITIAL SOLICITATION, IFB -0176; THAT YOU PRESUMED
YOUR DISTRIBUTOR WOULD RECEIVE THE AWARD; AND THAT INSTEAD OF RECEIVING
A NOTIFICATION OF AWARD, YOUR DISTRIBUTOR RECEIVED AN ANNOUNCEMENT THAT
ALL BIDS WERE BEING REJECTED AND THAT THE PROCUREMENT WOULD BE
READVERTISED. AS POINTED OUT ABOVE, ALTHOUGH THE BID OF YOUR
DISTRIBUTOR WAS THE LOWEST RECEIVED UNDER THE INITIAL SOLICITATION, IT
WAS REJECTED BECAUSE THE EQUIPMENT IT OFFERED WAS NOT EQUAL TO THE BRAND
NAME SPECIFIED THEREIN.
YOU STATE THAT SOLICITATION NO. -0807 CONTAINS A TABLE OF
REQUIREMENTS BASICALLY THE SAME AS SPECIFIED IN THE PREVIOUS
SOLICITATION, NO. -0176, EXCEPT FOR THE ADDITIONAL REQUIREMENT UNDER
PARAGRAPH 3.4.1 OF THE SPECIFICATIONS THAT THE BED WIDTH OF THE LATHE BE
NOT LESS THAN 19-1/2 INCHES. YOU ALLEGE THAT THIS ADDITIONAL
REQUIREMENT AS TO THE BED WIDTH PRECLUDES YOUR FIRM FROM COMPETITIVE
BIDDING BECAUSE THE MONARCH SERIES 612 SIZE 2516 LATHE IS THE ONLY LATHE
OF THIS BED WIDTH IN THIS CLASS OF MACHINE. YOU CONTEND THAT THE
PROCURING ACTIVITY HAS CIRCUMVENTED THE REQUIREMENTS OF ASPR 1-1202 BY
USING A PURCHASE DESCRIPTION INSTEAD OF MANDATORY SPECIFICATION
MIL-L-23251A DATED APRIL 7, 1967. YOU QUESTION THE CONTRACTING
OFFICER'S DETERMINATION THAT THE REQUIREMENTS OF IFB -0807 REPRESENT THE
MINIMUM NEEDS OF THE USER AGENCY. ALSO, YOU MAINTAIN THAT THE
19-1/2-INCH BED WIDTH AND THE 7/8-INCH BY 1-3/4-INCH TOOL SHANK
SPECIFIED IN PARAGRAPHS 3.4.1 AND 3.5.6 OF THE SPECIFICATIONS ARE
FEATURES WHICH ARE EXCLUSIVELY THOSE OF THE MONARCH SERIES 612, SIZE
2516 LATHE, AND THAT SUCH FEATURES ARE NOT COMPATIBLE WITH OTHER MACHINE
TOOL MANUFACTURERS OF A COMPARABLE SIZE LATHE.
THE BASES FOR NOT USING THE MILITARY SPECIFICATION TO WHICH YOU REFER
ARE SET FORTH IN A MEMORANDUM DATED JULY 30, 1969, FROM THE CHIEF, TOOL
AND EQUIPMENT DIVISION, ROCK ISLAND ARSENAL, WHICH READS, IN PART, AS
FOLLOWS: "1. THE QUESTIONS WHICH REQUIRE ADDITIONAL EXPLANATION IN
REFERENCE TO SUBJECT SOLICITATION COVERING FSN 3416-449-7192 LATHE HAVE
BEEN GIVEN CAREFUL REVIEW AND COMMENTS ARE SUBMITTED HEREWITH.'2. IN
REFERENCE TO WHY AND WHAT AREAS IN SPECIFICATION MIL-L-23251A ARE
INADEQUATE FOR PROCUREMENT, THE SPECIFICS ARE AS STATED HEREIN.
"A. THE CITED SPECIFICATION WAS NOT UTILIZED FOR THIS PROCUREMENT
DUE TO THE EXTENSIVE TECHNICAL INADEQUACIES AND GENERAL UNCLEARNESS.
"B. AREAS OF DISCREPANCIES OF THE SPECIFICATION ARE:
"PARA. 1.2 CLASSIFICATION: THE DEFINITION OF CLASSIFICATION IS NOT
SPECIFIED. IT APPEARS AN ATTEMPT WAS MADE BY THE SPECIFICATION WRITER
TO UTILIZE A COMMERCIAL DESIGNATION RECOGNIZED BY THE LATHE INDUSTRY.
HOWEVER, NO DEFINITION WAS STATED IN THE SPECIFICATION, AND WITHOUT
DEFINITION THE CLASSIFICATION IS OPEN TO INTERPRETATION. TO PROVIDE THE
DEFINITION NEEDED WOULD REQUIRE EXTENSIVE CHANGES TO THE CITED
SPECIFICATION. IT IS NOTED THAT THE LUTHER AND PEDERSEN BID, DATED
DECEMBER 10, 1968, QUOTED AMERICAN TOOL WORKS NUMBER 20D2 WHICH IS A
2013-16 STYLE D RAISED LATHE AND IS NOT THE 2516 LATHE AS CITED FOR TYPE
I ENGINE LATHES IN THE SPECIFICATION.
"C. FURTHER IN THIS CLASSIFICATION AREA, THE ONLY CLEAR DEFINITION
OF CLASSIFICATION IS IN EACH MANUFACTURER'S CATALOG WHEREIN CLEAR
TECHNICAL PARAMETERS ARE DELINEATED COVERING, E.G., 2516 LATHES. THIS IS
IN FACT THE SAME CATEGORY OF LATHES NOW DELINEATED IN THE PURCHASE
DESCRIPTION.
"D. PARAS. 3.4.3 HEADSTOCK SPINDLE, 3.4.6 HEADSTOCK GEARS AND
SHAFTS, 3.4.9 CROSS SLIDE AND COMPOUND, 3.4.10 CARRIAGE FEEDS, 3.4.11
TAILSTOCK AND 3.7.1 CENTER AND CENTER SLEEVE CONTAIN RESTRICTIVE DESIGN
MATERIAL HARDNESS REQUIREMENTS.
"E. TABLE I (PAGE 8 OF THE SPECIFICATION) CITES TECHNICAL
INADEQUACIES AND UNCLEARNESS OF BOTH CLASSES 1 AND 2 UNDER SIZE 2516,
E.G., DIA OF THRU HOLE 2 INCHES SHOULD BE 2-1/16 INCHES; HEADSTOCK
CENTER SIZE ASA 4 SHOULD BE 5; TAIL STOCK CENTER SIZE ASA 4 SHOULD B
5; FACE PLATE DIA SM 10 SHOULD BE 12; FOLLOW REST CAPACITY RANGE 1-5
SHOULD BE 1-6.'3. IN REFERENCE TO WHY THE 19-1/2 INCH MINIMUM BED WIDTH
WAS SPECIFIED IN SUBJECT IFB WHILE THE PRECEDING IFB'S APPARENTLY DID
NOT STATE IT, THE SPECIFICS ARE AS STATED HEREIN.
"A. THE TWO PREVIOUS IFB'S DID IN FACT SPECIFY THE SPECIFIC
MANUFACTURER'S (BY NAME) 2516 LATHE.
"B. THE DESIGNATED 2516 LATHE OF EACH MANUFACTURER: AMERICAN, LODGE
AND SHIPLEY, AND MONARCH HAS THE FOLLOWING BED WIDTHS RESPECTIVELY: 20
INCH, 21-1/4 INCH AND 19-1/2 INCH.
"C. THE PURPOSE OF THE 19-1/2 INCH MINIMUM BED WIDTH WAS INCLUDED IN
PURCHASE DESCRIPTION T-AND-E PD-65 TO PROVIDE FURTHER DEFINITION OF THE
LATHE REQUIREMENTS, MAINTAINING, OF COURSE, THE SAME CATEGORY OF BASE
LINE REQUIREMENTS (2516 LATHE) FOR THE UNDERSTANDABILITY OF ALL BIDDERS
WHILE STILL COMPLYING WITH THE BASIC UNCHANGED ARMY USER NEEDS.'
IT IS FURTHER REPORTED THAT THE MILITARY SPECIFICATION TO WHICH YOU
REFER WAS NOT USED BECAUSE IT WAS NOT CONSIDERED SUFFICIENTLY DEFINITE
TO INSURE THAT THE EQUIPMENT FURNISHED WOULD MEET THE MINIMUM ESSENTIAL
REQUIREMENTS OF THE GOVERNMENT. RATHER, IT WAS DETERMINED TO USE A
PURCHASE DESCRIPTION SETTING FORTH THE MINIMUM ESSENTIAL REQUIREMENTS
RATHER THAN TO EXTENSIVELY MODIFY THE MILITARY SPECIFICATION. IN FURTHER
REGARD TO THE USE OF THE CITED MILITARY SPECIFICATION, THE ARMY STATES
THAT THE EQUIPMENT PREVIOUSLY OFFERED BY YOUR DISTRIBUTOR, AMERICAN TOOL
WORKS, MODEL NO. 20D2 IS A "2013-16 STYLE D RAISED LATHE" AND NOT THE
2516 LATHE AS CITED FOR TYPE I ENGINE LATHES IN THE REFERRED-TO MILITARY
SPECIFICATION. THE CITED EQUIPMENT WOULD THEREFORE UNDOUBTEDLY BE
DETERMINED UNACCEPTABLE BY THE ROCK ISLAND ARSENAL IF OFFERED PURSUANT
TO MILITARY SPECIFICATION MIL-L-23251A DATED APRIL 7, 1967, SIZE MACHINE
2516 CLASS I. THE ARMY STATES THAT THE PURCHASE DESCRIPTION USED IS NOT
CONSIDERED TO BE RESTRICTIVE AND DID NOT SET FORTH MINOR DESIGN DETAILS
OR SPECIFY FEATURES PECULIAR TO A PARTICULAR MAKE OF EQUIPMENT AS YOU
ALLEGE. MOREOVER, THE ARMY ADVISES THAT THE PURCHASE DESCRIPTION WAS
WRITTEN TO INCLUDE ALL MANUFACTURERS WITHOUT USING ONE MANUFACTURER'S
2516 DESIGNATION BY PROVIDING CLEAR DEFINITION OF ITEM REQUIREMENTS. AS
AN EXAMPLE, IT CITES THE FOLLOWING PURCHASE DESCRIPTION REQUIREMENTS AND
THE CORRESPONDING RESPECTIVE CAPABILITIES OF THE THREE PROSPECTIVE
CONTRACTORS:
PURCHASE DESCRIPTION LODGE AND
REQUIREMENT AMERICAN SHIPLEY MONARCH
-------------------- -------- --------- ------- S
27 24 36 SPINDLE SPEEDS, RANGE (RPM):
LOW, NOT MORE THAN 18 18 18 12
HIGH, NOT LESS THAN 1,000 1,200 1,000 1,500
BED WIDTH, IN INCHES:
NOT LESS THAN 19-1/2 20 20-1/4 19-1/2
IN VIEW OF THE ABOVE, IT SEEMS THAT THE PURCHASE DESCRIPTION STATED
THE ESSENTIAL CHARACTERISTICS AND FUNCTIONS OF THE EQUIPMENT NEEDED BY
THE USING ACTIVITY AS REQUIRED BY ASPR 1-1206.1. THAT REGULATION
PROVIDES IN PERTINENT PART WITH RESPECT TO DESCRIPTION OF GOODS AND
SERVICES TO BE PURCHASED UNDER COMPETITIVE BIDDING PROCEDURES:
"/A) A PURCHASE DESCRIPTION MAY BE USED IN LIEU OF A SPECIFICATION
WHEN AUTHORIZED BY 1-1202 (B) AND, SUBJECT TO THE RESTRICTION ON
REPETITIVE USE IN 1-1202 (B) (VII), WHERE NO APPLICABLE SPECIFICATION
EXISTS. A PURCHASE DESCRIPTION SHOULD SET FORTH THE ESSENTIAL
CHARACTERISTICS AND FUNCTIONS OF THE ITEMS OR MATERIALS REQUIRED.
PURCHASE DESCRIPTIONS SHALL NOT BE WRITTEN SO AS TO SPECIFY A PRODUCT,
OR A PARTICULAR FEATURE OF A PRODUCT, PECULIAR TO ONE MANUFACTURER AND
THEREBY PRECLUDE CONSIDERATION OF A PRODUCT MANUFACTURED BY ANOTHER
COMPANY UNLESS IT IS DETERMINED THAT THE PARTICULAR FEATURE IS ESSENTIAL
TO THE GOVERNMENT'S REQUIREMENTS, AND THAT SIMILAR PRODUCTS OF OTHER
COMPANIES LACKING THE PARTICULAR FEATURE WOULD NOT MEET THE MINIMUM
REQUIREMENTS FOR THE ITEM. * * *"
WHILE ASPR 1-1202 (A) PROVIDES THAT COORDINATED MILITARY
SPECIFICATIONS ARE MANDATORY FOR USE BY THE DEPARTMENT OF DEFENSE IN THE
PROCUREMENT OF SUPPLIES COVERED BY THAT SPECIFICATION, SUBSECTION ,C" OF
THAT REGULATION PROVIDES THAT SUCH SPECIFICATION NEED NOT BE USED WHEN
IT IS DETERMINED, AS HERE, THAT THE SPECIFICATION DOES NOT MEET THE
PARTICULAR OR ESSENTIAL NEEDS OF THE AGENCY. SEE 43 COMP. GEN. 680, 681
(1964) AND 44 ID. 27, 31 (1964).
YOU ASSERT THAT THE PURCHASE DESCRIPTION IN IFB -0807 IS RESTRICTIVE.
THIS ASSERTION MAY BE TRUE TO THE EXTENT THAT THE PURCHASE DESCRIPTION
IN THE CITED IFB MAY HAVE PRECLUDED YOUR FIRM FROM SUBMITTING A
RESPONSIVE BID THROUGH YOUR DISTRIBUTOR WITHOUT CHANGING YOUR COMMERCIAL
OR STANDARD EQUIPMENT TO COMPLY WITH THE PURCHASE DESCRIPTION. IN THIS
SENSE, OF COURSE, ALL SPECIFICATIONS ARE RESTRICTIVE SINCE THE
REQUIREMENTS THEY NECESSARILY ESTABLISH, WHETHER REASONABLE OR NOT,
PRECLUDE THE PURCHASE OF NONCONFORMING ITEMS. HOWEVER, THERE IS NO
REQUIREMENT THAT THE UNITED STATES PURCHASE EQUIPMENT MERELY BECAUSE IT
IS OFFERED AT A LOWER PRICE, WITHOUT INTELLIGENT REFERENCE TO THE
PARTICULAR NEEDS TO BE SERVED; NOR IS THE GOVERNMENT TO BE PLACED IN
THE POSITION OF ALLOWING BIDDERS TO DICTATE SPECIFICATIONS WHICH WILL
PERMIT ACCEPTANCE OF EQUIPMENT WHICH DOES NOT, IN THE CONSIDERED
JUDGMENT OF THE CONTRACTING AGENCY, REASONABLY MEET THE AGENCY'S NEED.
36 COMP. GEN. 251, 252 (1956); B-152861, APRIL 10, 1964.
ON THE BASIS OF THE PRESENT RECORD, WE FIND NO LEGAL BASES TO OBJECT
TO THE ACTION OF THE CONTRACTING OFFICER IN CANCELING IFB NO. -0176 OR
TO AWARD OF A CONTRACT TO MONARCH MACHINE TOOL COMPANY UNDER IFB NO.
-0807, IF OTHERWISE PROPER. ACCORDINGLY, YOUR PROTEST IS DENIED.
B-167860, OCT. 31, 1969
TRAVEL EXPENSES--HEADQUARTERS--DETERMINATION
CLAIM FOR $784.70 REPRESENTING BALANCE DUE ON ADVANCE OF TRAVEL FUNDS
INCIDENT TO EMPLOYEE'S TRANSFER FROM CLEVELAND, OHIO TO ALEXANDRIA, VA;
RESULTING FROM FACT HE WAS ADVANCED FUNDS ON BASIS OF TRANSFER FROM
GRAND RAPIDS, MICH; WHEREAS HE WAS HELD ENTITLED ONLY TO REIMBURSEMENT
FROM CLEVELAND, IS DISALLOWED AS ADMINISTRATIVE ADVICE WAS PREDICATED
UPON EMPLOYEE'S ASSERTIONS THAT HE PERFORMED GREATER PART OF OFFICIAL
DUTIES IN GRAND RAPIDS AREA BUT PRESENT RECORD INDICATES SUCH WAS NOT
CASE, THUS NO BASIS EXISTS TO REGARD GRAND RAPIDS AS OFFICIAL DUTY
STATION, AND REIMBURSEMENT OF EXPENSES MUST THEREFORE BE LIMITED TO COST
OF TRAVEL AND TRANSPORTATION FROM CLEVELAND. SEE 32 COMP. GEN. 87.
TO MR. THOMAS E. MARCHAND, SR.:
THIS REFERS TO YOUR LETTER OF AUGUST 19, 1969, WITH ENCLOSURES,
REQUESTING REVIEW OF OUR OFFICE SETTLEMENT DATED AUGUST 11, 1969, WHICH
DISALLOWED YOUR CLAIM FOR $784.70, REPRESENTING THE BALANCE DUE ON AN
ADVANCE OF TRAVEL FUNDS INCIDENT TO YOUR TRANSFER FROM THE EQUAL
EMPLOYMENT OPPORTUNITY COMMISSION (EEOC), CLEVELAND, OHIO, TO THE
DEFENSE SUPPLY AGENCY (DSA), ALEXANDRIA, VIRGINIA, EFFECTIVE JULY 14,
1968. YOUR INDEBTEDNESS IN THE ABOVE-STATED AMOUNT RESULTS FROM THE
FACT THAT YOU WERE ADVANCED FUNDS BY DSA ON THE BASIS OF A TRANSFER FROM
GRAND RAPIDS, MICHIGAN, TO ALEXANDRIA, VIRGINIA, WHEREAS YOU WERE HELD
TO BE ENTITLED ONLY TO REIMBURSEMENT OF EXPENSES FROM CLEVELAND, OHIO.
YOU APPARENTLY DO NOT CONTEND THAT THE DISALLOWANCE OF YOUR CLAIM BY
OUR CLAIMS DIVISION IS ERRONEOUS UNDER THE APPLICABLE PROVISIONS OF LAW.
HOWEVER, YOU BELIEVE THAT YOUR CLAIM SHOULD BE ALLOWED AS A MATTER OF
EQUITY SINCE YOU HAD BEEN ADVISED ADMINISTRATIVELY THAT YOU WOULD BE
ENTITLED TO TRAVEL AND TRANSPORTATION ALLOWANCES FROM GRAND RAPIDS,
MICHIGAN, TO ALEXANDRIA, VIRGINIA. IN THAT REGARD THE RECORD SHOWS THAT
SUCH ADMINISTRATIVE ADVICE WAS PREDICATED UPON YOUR ASSERTIONS DURING
THE COURSE OF A PREEMPLOYMENT INTERVIEW WITH OFFICIALS OF DSA THAT
ALTHOUGH YOU WERE ASSIGNED TO THE CLEVELAND REGIONAL OFFICE OF EEOC, YOU
PERFORMED THE GREATER PART OF YOUR OFFICIAL DUTIES IN THE GRAND RAPIDS
AREA.
AN EMPLOYEE'S OFFICIAL DUTY STATION IS THE PLACE AT WHICH HE ACTUALLY
IS STATIONED, THAT IS, THE PLACE WHERE THE EMPLOYEE IS EXPECTED TO AND
DOES IN FACT PERFORM THE GREATER PART OF HIS OFFICIAL DUTIES. 32 COMP.
GEN. 87. THUS, IN VIEW OF YOUR ASSERTIONS, IT WAS NOT UNREASONABLE FOR
THE PERSONNEL OF DSA TO BELIEVE THAT YOU WOULD BE ENTITLED TO
REIMBURSEMENT OF EXPENSES FROM GRAND RAPIDS RATHER THAN CLEVELAND.
IN CONNECTION WITH THE REVIEW OF YOUR CLAIM, WE FOUND IT NECESSARY TO
OBTAIN COPIES OF VOUCHERS COVERING YOUR OFFICIAL TRAVEL ASSIGNMENTS
WHILE EMPLOYED WITH THE CLEVELAND REGIONAL OFFICE OF EEOC. THOSE
VOUCHERS SHOW THAT DURING THE PERIOD FROM SEPTEMBER 15, 1967, TO APRIL
21, 1968, YOU WERE REQUIRED TO PERFORM OFFICIAL BUSINESS IN THE STATE OF
MICHIGAN ON ONLY 30 DAYS. APPARENTLY, YOU PERFORMED NO OFFICIAL TRAVEL
AFTER APRIL 21, 1968. CONSISTENT WITH THE ABOVE, EEOC HAS INFORMED US
THAT CLEVELAND WAS YOUR DESIGNATED OFFICIAL DUTY STATION.
SINCE THE PRESENT RECORD INDICATES THAT YOU DID NOT PERFORM THE
GREATER PART OF YOUR OFFICIAL DUTIES IN THE GRAND RAPIDS AREA, THERE IS
NO BASIS TO REGARD THAT LOCATION AS YOUR OFFICIAL DUTY STATION WHILE
EMPLOYED WITH EEOC. IT FOLLOWS, THEREFORE, THAT REIMBURSEMENT OF YOUR
TRANSFER EXPENSES MUST BE LIMITED TO THE COST OF TRAVEL AND
TRANSPORTATION FROM CLEVELAND, OHIO.
FOR THE REASONS STATED ABOVE, THE DISALLOWANCE OF YOUR CLAIM IS
SUSTAINED.
CONCERNING THE ABOVE, WE HAVE NOTED THE STATEMENTS IN YOUR LETTERS OF
APRIL 7 AND AUGUST 19, 1969, TO OUR OFFICE THAT YOU WORKED PREDOMINATELY
IN MICHIGAN. AS IS EVIDENT FROM OUR CONCLUSIONS AS SET FORTH ABOVE, THE
RECORDS THAT WE HAVE BEFORE US ARE NOT IN ACCORD WITH YOUR STATEMENTS.
THERE MAY BE FURTHER INFORMATION WHICH YOU HAVE WHICH COULD SERVE TO
CLARIFY THE APPARENT INCONSISTENCY AS TO THE PLACE AT WHICH THE GREATER
PART OF YOUR DUTY WAS PERFORMED. UPON RECEIPT OF ANY FURTHER EVIDENCE
YOU MAY CARE TO PRESENT TO US WE WILL GIVE FURTHER CONSIDERATION TO YOUR
CASE.
B-167875, OCT. 31, 1969
COMPENSATION--POSTAL SERVICE--REMOVALS, SUSPENSIONS, ETC.--BACK
PAY--DEDUCTIONS FROM BACK PAY
EMPLOYEE'S CLAIM FOR AMOUNT DEDUCTED FOR GROUP HEALTH BENEFITS FROM
BACKPAY HE RECEIVED IN ACCORDANCE WITH 5 U.S.C. 652 AND 5 U.S.C. 5596
INCIDENT TO PERIOD OF UNJUSTIFIED SEPARATION FROM POST OFFICE DEPARTMENT
IS AGAIN DISALLOWED, AS SUBSEC. (B) (2), 5 U.S.C. 5596 AND 5 U.S.C. 652
PROVIDE THAT "FOR ALL PURPOSES" EMPLOYEE IS DEEMED TO HAVE PERFORMED
SERVICE FOR AGENCY DURING PERIOD OF WRONGFUL SEPARATION; PARTICIPATION
IN HEALTH INSURANCE PROGRAM IS ENTIRELY VOLUNTARY AND CLAIMANT COULD
HAVE REMOVED HIMSELF FROM COVERAGE UNDER PROGRAM AT ANY TIME; AND AT
TIME OF SEPARATION 5 U.S.C. 3009C, 1964 ED. PROVIDED THAT SUCH EMPLOYEE
SHALL HAVE COVERAGE RESTORED TO SAME EXTENT AND EFFECT AS THOUGH REMOVAL
HAD NOT TAKEN PLACE, AND APPROPRIATE ADJUSTMENTS SHALL BE MADE IN
PREMIUMS, SUBSCRIPTION CHARGES, CONTRIBUTIONS, AND CLAIMS. SEE 41 COMP.
GEN. 273.
TO MR. SOLOMON G. ALVAREZ:
THIS WILL REFER TO YOUR LETTER OF AUGUST 26, 1969, WHICH WE
UNDERSTAND TO BE IN THE NATURE OF AN APPEAL OF A SETTLEMENT OF THE
CLAIMS DIVISION OF THIS OFFICE OF AUGUST 18, 1969. THAT SETTLEMENT
DISALLOWED YOUR CLAIM FOR CERTAIN AMOUNTS DEDUCTED FROM BACK PAY YOU
RECEIVED IN ACCORDANCE WITH PROVISIONS OF 5 U.S.C. 652 AND 5 U.S.C.
5596, INCIDENT TO TWO SEPARATE INTERVALS DURING WHICH YOU WERE REMOVED
AND THEN RESTORED TO SERVICE IN THE POST OFFICE DEPARTMENT. THE
DEDUCTIONS WERE AS FOLLOWS: IN THE CASE OF THE FIRST SETTLEMENT BY THIS
OFFICE, MAY 20, 1964, DEDUCTIONS FOR FEDERAL EMPLOYEES' GROUP LIFE
INSURANCE (FEGLI) PREMIUMS IN AN AMOUNT OF $41.25 AND FOR DEDUCTIONS FOR
GROUP HEALTH BENEFITS, $87.30. IN THE CASE OF THE SECOND SETTLEMENT
EFFECTED BY THE POST OFFICE DEPARTMENT ON OCTOBER 4, 1967, THE AMOUNT IN
QUESTION IS $45.50 FOR LIFE INSURANCE PREMIUMS.
NEITHER THE BACK PAY LAW, 5 U.S.C. 5596, NOR THE PRIOR LAW AS SET
FORTH IN 5 U.S.C. 652, NOR THE REGULATIONS IMPLEMENTING THEM, MAKES ANY
SPECIFIC REFERENCE TO DEDUCTIONS FROM BACK PAY OF LIFE INSURANCE
PREMIUMS OR HEALTH BENEFITS PAYMENTS WHICH WOULD HAVE BEEN DEDUCTED FROM
AN EMPLOYEE'S PAY DURING A PERIOD OF UNJUSTIFIED SEPARATION FROM THE
SERVICE HAD HE NOT BEEN SEPARATED. SUBSECTION (B) (2) OF 5 U.S.C. 5596
AND 5 U.S.C. 652, SO FAR AS PERTINENT HERE, PROVIDE, HOWEVER, THAT "FOR
ALL PURPOSES" AN EMPLOYEE IS DEEMED TO HAVE PERFORMED SERVICE FOR THE
AGENCY DURING THE PERIOD OF WRONGFUL SEPARATION.
WITH RESPECT TO THE HEALTH INSURANCE PROGRAM, IT IS FIRST TO BE NOTED
THAT PARTICIPATION IN IT IS ENTIRELY VOLUNTARY. UNDER THE IMPLEMENTING
REGULATIONS, SUBSECTION 5 CFR 890.304 (D), A MEANS EXISTS FOR
CANCELLATION OF ENROLLMENT BY AN EMPLOYEE AT ANY TIME, EFFECTIVE ON THE
LAST DAY OF THE PAY PERIOD AFTER THE PAY PERIOD IN WHICH THE
CANCELLATION FORM IS RECEIVED BY THE EMPLOYING OFFICE.
SIMILAR REGULATORY PROVISIONS HAVE BEEN IN EFFECT THROUGHOUT THE
PERIODS DURING WHICH YOU HAVE BEEN REMOVED AND THEN RESTORED TO THE
SERVICE. PRESUMABLY, HAD YOU WISHED TO REMOVE YOURSELF FROM COVERAGE
UNDER THE HEALTH BENEFITS PROGRAM, YOU COULD HAVE EXERCISED THE
PRIVILEGE.
THE HEALTH BENEFITS ACT MAKES SPECIFIC PROVISION FOR RIGHTS OF
EMPLOYEES RESTORED TO DUTY AFTER WRONGFUL SEPARATION. AT THE TIME YOU
WERE FIRST SEPARATED FROM THE SERVICE, FEBRUARY 19, 1963, TO OCTOBER 9,
1963, THE LAW (5 U.S.C. 3009C, 1964 ED.) PROVIDED THAT SUCH AN EMPLOYEE
"SHALL NOT BE DEPRIVED OF COVERAGE OR BENEFITS FOR THE INTERIM BUT SHALL
HAVE HIS COVERAGE RESTORED TO THE SAME EXTENT AND EFFECT AS THOUGH SUCH
REMOVAL OR SUSPENSION HAD NOT TAKEN PLACE, AND APPROPRIATE ADJUSTMENTS
SHALL BE MADE IN PREMIUMS, SUBSCRIPTION CHARGES, CONTRIBUTIONS AND
CLAIMS.' ACCORDINGLY, OUR SETTLEMENT OF MAY 20, 1964, APPLIED THIS
PROVISION OF THE LAW WHICH REQUIRED THAT ,COVERAGE BE RESTORED" AND
APPROPRIATE ADJUSTMENTS MADE IN EMPLOYEE PAYMENTS. 41 COMP. GEN. 273.
IN 1964 THIS PROVISION OF THE LAW WAS CHANGED BY ENACTMENT OF PUBLIC
LAW 88-284, SUBSECTION 1 (14), 5 U.S.C. 8908. UNDER THIS AMENDMENT THE
RESTORED EMPLOYEE NOW HAS A CHOICE OF EITHER ENROLLING AS A NEW EMPLOYEE
UPON RESTORATION TO SERVICE OR HAVING HIS COVERAGE RESTORED.
ACCORDINGLY, AT THE TIME OF YOUR SECOND REINSTATEMENT, JULY 20, 1967,
THIS AMENDMENT WAS APPLIED IN YOUR CASE. APPARENTLY, YOU ELECTED NOT TO
HAVE HEALTH BENEFITS COVERAGE RESTORED AS IN EFFECT AT THE TIME YOU WERE
SEPARATED ON DECEMBER 23, 1966, AND HEALTH BENEFITS PAYMENTS WERE NOT
DEDUCTED FROM YOUR BACK PAY FOR THAT PERIOD OF SEPARATION.
WITH RESPECT TO THE DEDUCTIONS FOR LIFE INSURANCE PREMIUMS FROM BACK
PAY, NEITHER THE LAW NOR REGULATIONS GOVERNING THE FEDERAL EMPLOYEES'
GROUP LIFE INSURANCE PROGRAM MAKES ANY SPECIAL PROVISION AS TO THE
STATUS OF EMPLOYEES RESTORED TO DUTY AFTER WRONGFUL SEPARATION. THE
FEDERAL PERSONNEL MANUAL SUPPLEMENT 870-1, S4-2E, PROVIDES, HOWEVER,
WITH RESPECT TO DEDUCTIONS FOR LIFE INSURANCE PREMIUMS FROM BACK PAY AS
FOLLOWS:
"E. RESTORATION AFTER ERRONEOUS SUSPENSION OR REMOVAL. IF AN
EMPLOYEE IS RETROACTIVELY RESTORED TO DUTY WITH PAY AFTER AN ERRONEOUS
SUSPENSION OR REMOVAL, WITHHOLDINGS FOR THE PERIOD OF SUSPENSION OR
REMOVAL WILL BE MADE FROM THE RETROACTIVE PAY ADJUSTMENT.' DECISIONS OF
THIS OFFICE HAVE HELD THAT SUCH DEDUCTIONS ARE REQUIRED. 36 COMP. GEN.
225, B-132700, FEBRUARY 25, 1958; B-133942, APRIL 15, 1958; B-144070,
NOVEMBER 17, 1961; B-152119, AUGUST 12, 1963.
IN THE CASE OF PAROCZAY V UNITED STATES, 369 F.2D 720 (1966), THE
COURT OF CLAIMS UPHELD THE LEGALITY OF DEDUCTIONS OF LIFE INSURANCE
PREMIUMS FROM BACK PAY OF AN EMPLOYEE RESTORED TO DUTY AFTER WRONGFUL
SEPARATION. IN ITS OPINION, THE COURT INTERPRETED THE FEGLI STATUTE AS
PROVIDING CONTINUOUS COVERAGE OF A WRONGFULLY SEPARATED EMPLOYEE DURING
THE PERIOD OF HIS SEPARATION IN THE ABSENCE OF ANY ACTION BY THE
EMPLOYEE TO CANCEL HIS POLICY EITHER BEFORE, DURING OR AFTER HIS
SEPARATION.
THE LAW, 5 U.S.C. 8702, AND IMPLEMENTING REGULATIONS PROVIDE A
SPECIFIC PROCEDURE FOR CANCELLATION OF A LIFE INSURANCE POLICY AT ANY
TIME BY THE FILING, BY AN EMPLOYEE, OF A WAIVER WITH HIS EMPLOYING
OFFICE. SIMILAR PROVISIONS HAVE BEEN IN EFFECT THROUGHOUT THE PERIOD
HERE IN QUESTION. WE FIND NOTHING IN THE RECORD OF YOUR CASE TO
INDICATE THAT YOU ACTED TO WAIVE LIFE INSURANCE COVERAGE AT ANY TIME
DURING THE PERIOD IN QUESTION. THEREFORE, HAVING HAD THE CONTINUING
BENEFIT OF INSURANCE COVERAGE IT WAS NECESSARY TO DEDUCT THE PREMIUMS
FOR WHICH YOU WERE OBLIGATED FROM THE BACK PAY YOU RECEIVED.
ACCORDINGLY, WE FIND NO BASIS UPON WHICH TO REVERSE THE SETTLEMENT OF
THE CLAIMS DIVISION OF AUGUST 18, 1969. WE POINT OUT THAT DECISIONS OF
THIS OFFICE ARE FINAL AND CONCLUSIVE UPON THE EXECUTIVE BRANCH OF THE
GOVERNMENT. HOWEVER, WE WOULD REFER YOU TO THE PROVISIONS OF 28 U.S.C.
1346 AND 28 U.S.C. 1491 FOR GUIDANCE AS TO POSSIBLE JUDICIAL REMEDIES
WHICH ARE AVAILABLE TO YOU.
B-167972, OCT. 31, 1969
NEGOTIATION--PROPRIETY
UPON RECEIPT OF ONLY ONE BID FOR CONSTRUCTION OF BALLOON INFLATION
BUILDING WHICH EXCEEDED GOVERNMENT'S ESTIMATE BY 72 PERCENT AND BY 45
PERCENT AFTER NEGOTIATED REDUCTION IN PRICE AND WHERE ATTEMPTS TO
NEGOTIATE WITH OTHER FIRMS FAILED TO ACHIEVE RESULTS, PROTEST AGAINST
NEGOTIATION PROCEDURES UTILIZED IS DENIED, 41 U.S.C. 252 (C) (14)
PROVIDING THAT CONTRACTS FOR SERVICES MAY BE NEGOTIATED WITHOUT
ADVERTISING IF BID PRICES AFTER ADVERTISING ARE NOT REASONABLE AND NO
LEGAL BASIS EXISTS FOR OBJECTION EITHER TO SUBSEQUENT NEGOTIATION
PROCEDURES OR TO REJECTION OF BID WHEN IT IS IN PUBLIC INTEREST TO DO
SO, ABSENT BAD FAITH OR ARBITRARY ACTION OF ADMINISTRATIVE AGENCY.
TO TECTONICS, INC.:
REFERENCE IS MADE TO YOUR TELEGRAM OF SEPTEMBER 19, 1969, FORWARDED
TO OUR OFFICE BY SENATOR HUGH SCOTT, PROTESTING AGAINST THE NEGOTIATION
PROCEDURES UTILIZED BY THE DEPARTMENT OF COMMERCE, WEATHER BUREAU, FORT
WORTH, TEXAS, SUBSEQUENT TO THE ISSUANCE OF INVITATION FOR BIDS NO.
6WBS69, INVOLVING THE CONSTRUCTION OF A BALLOON INFLATION BUILDING AT
INTERNATIONAL AIRPORT, SAN JUAN, PUERTO RICO.
OF THE 12 FIRMS SOLICITED, ONLY YOUR COMPANY SUBMITTED A BID IN
RESPONSE TO THE INVITATION, WHICH WAS ISSUED ON JUNE 30, 1969. THE
$100,000 BID EXCEEDED THE GOVERNMENT ESTIMATE OF $58,000 BY
APPROXIMATELY 72 PERCENT. IN LIGHT THEREOF, YOUR COMPANY WAS ADVISED
THAT ITS BID HAD BEEN REJECTED BECAUSE IT WAS CONSIDERED TO BE
EXCESSIVE. THEREAFTER, NEGOTIATIONS WERE CONDUCTED INITIALLY WITH YOUR
COMPANY, RESULTING IN A NEGOTIATED REDUCTION OF YOUR BID PRICE TO
$85,000, APPROXIMATELY 45 PERCENT IN EXCESS OF THE GOVERNMENT ESTIMATE.
REPRESENTATIVES OF YOUR COMPANY WERE ADVISED THAT THE OFFERED PRICE
REMAINED EXCESSIVE AND UNREASONABLE, AND, THEREFORE, FURTHER
NEGOTIATIONS WOULD BE NECESSARY. APPARENTLY, AT THIS POINT, NEGOTIATIONS
BROKE DOWN. ATTEMPTS TO NEGOTIATE WITH OTHER FIRMS ACHIEVED NO RESULTS
AND, AT PRESENT, WE ARE ADVISED THAT DUE TO CERTAIN OPERATIONAL PROBLEMS
THAT HAVE SINCE COME TO LIGHT THE PROJECT WILL BE DELAYED AND NO
CONTRACT AWARD IS CONTEMPLATED AT THIS TIME.
YOUR COMPANY CONTENDS THAT ITS INITIAL, LOW AND SOLE BID WAS NOT
UNREASONABLE IN VIEW OF THE $86,000 GOVERNMENT ESTIMATE. IN ADDITION,
YOU ALLEGE THAT, AFTER SUBMITTING A REDUCED NEGOTIATED PRICE, THE
NEGOTIATION BY THE CONTRACTING OFFICER WITH OTHER COMPANIES USING YOUR
PRICE AS A BASE WAS "PROBABLY ILLEGAL.'
THE RECORD DISCLOSES THAT YOUR COMPANY WAS UNDER THE MISTAKEN
IMPRESSION THAT THE GOVERNMENT ESTIMATE FOR THE BUILDING WAS $86,000,
WHEN, IN FACT, THE ESTIMATE TOTALED $58,000. WHILE THIS
MISUNDERSTANDING IS REGRETTABLE, WE FIND NO EVIDENCE OF IMPROPER CONDUCT
ON THE PART OF WEATHER BUREAU CONTRACTING OFFICIALS IN THIS REGARD.
41 U.S.C. 253 (B) PROVIDES THAT ALL BIDS SUBMITTED IN RESPONSE TO AN
ADVERTISED SOLICITATION MAY BE REJECTED WHEN A DETERMINATION IS MADE
THAT IT IS IN THE PUBLIC INTEREST TO DO SO. AS A COROLLARY TO THIS
AUTHORITY, YOUR COMPANY'S BID WAS SUBJECT TO PARAGRAPH 10 (B) OF THE
INSTRUCTIONS TO BIDDERS WHICH PROVIDES THAT THE GOVERNMENT MAY, WHEN IN
ITS INTEREST, REJECT ANY AND ALL BIDS. SEE ALSO FEDERAL PROCUREMENT
REGULATIONS 1-2.404-2 (C); 1-2.404-1 (B) (5) AND 1-3.214; B-159354,
AUGUST 3, 1966; B-166621, JULY 10, 1969.
41 U.S.C. 252 (C) (14) PROVIDES THAT ALL CONTRACTS FOR SERVICES SHALL
BE MADE BY ADVERTISING EXCEPT THAT SUCH CONTRACTS MAY BE NEGOTIATED
WITHOUT ADVERTISING IF IT IS DETERMINED THAT BID PRICES AFTER
ADVERTISING ARE NOT REASONABLE. IN THE CASE OF BOTH YOUR INITIAL AND
NEGOTIATED BIDS, THE CONTRACTING OFFICER DETERMINED THAT YOUR PRICES
WERE UNREASONABLE AND EXCESSIVE, BASED UPON THE GOVERNMENT ENGINEERS'
ESTIMATE AND THE COST OF SIMILAR BUILDINGS CONSTRUCTED AT OTHER SITES.
THE FACTS REVEAL THAT THE CONTRACTING OFFICER COMPLIED WITH STATUTORY
AND REGULATORY REQUIREMENTS BY NOTIFYING YOUR COMPANY OF HIS INTENTION
TO NEGOTIATE AND BY AFFORDING YOUR COMPANY A REASONABLE OPPORTUNITY TO
NEGOTIATE. SEE 41 U.S.C. 252 (C) (14) (A). WITH RESPECT TO YOUR
COMPANY'S CONCERN AS TO THE DISCLOSURE OF ITS NEGOTIATED BID PRICE, WE
HAVE BEEN ADVISED BY THE CONTRACTING OFFICIALS THAT IN THE NEGOTIATIONS
WITH OTHER PROSPECTIVE CONTRACTORS, ONLY YOUR $100,000 BID PREVIOUSLY
REVEALED AT PUBLIC OPENING WAS MADE AVAILABLE. WE CONSIDER THIS TO BE
PROPER UNDER THE CIRCUMSTANCES. AS WE HELD IN B-159354, SUPRA:
"WE ARE WELL AWARE THAT THE REJECTION OF BIDS AFTER THEY ARE OPENED
IS A SERIOUS MATTER AND SHOULD NOT BE DONE EXCEPT FOR COGENT REASONS.
HOWEVER, THERE IS LESS REASON FOR APPLICATION OF THE RULE WHEN ONLY ONE
BID IS RECEIVED. FURTHERMORE, WE HAVE RECOGNIZED THAT SINCE CONTRACTING
OFFICERS ARE AGENTS OF, AND ARE REQUIRED TO WORK IN THE BEST INTERESTS
OF THE GOVERNMENT, THEIR ACTIONS IN REJECTING BIDS MAY NOT BE CONSIDERED
IMPROPER WHEN BASED UPON SUBSTANTIAL REASONS LEADING TO A BONA FIDE
BELIEF THAT THE INTEREST OF THE GOVERNMENT WILL BE BEST SERVED THEREBY.
SEE 38 COMP. GEN. 235, 39 COMP. GEN. 86.'
IT IS THE FUNCTION OF THE ADMINISTRATIVE AGENCY TO DETERMINE WHETHER
A LOW ACCEPTABLE BID IS IN EXCESS OF THE AMOUNT FOR WHICH THE GOVERNMENT
SHOULD BE ABLE TO OBTAIN THE SERVICES SOUGHT AND, IN THE ABSENCE OF BAD
FAITH, OR ARBITRARY OR CAPRICIOUS ACTION, WE CANNOT QUESTION THE
REJECTION OF A BID BECAUSE THE PRICE WAS CONSIDERED EXCESSIVE. 36 COMP.
GEN. 364 (1956); 39 COMP. GEN. 396 1959); B-164523, AUGUST 28, 1968.
THE AUTHORITY TO REJECT ANY OR ALL BIDS IS EXTREMELY BROAD, INVOLVING
PRIMARILY A MATTER OF ADMINISTRATIVE JUDGMENT, AND WE WILL NOT QUESTION
ITS EXERCISE IN THE ABSENCE OF A CLEAR SHOWING OF ABUSE OF DISCRETION.
B-159865, OCTOBER 6, 1966; B-161797, SEPTEMBER 6, 1967; B-161331, MAY
15, 1967; B-166679, JUNE 10, 1969.
IN VIEW OF THE AFOREGOING, WE SEE NO LEGAL BASIS FOR OBJECTION BY OUR
OFFICE EITHER TO THE REJECTION OF YOUR BID OR TO THE SUBSEQUENT
NEGOTIATION PROCEDURES.
B-167977, OCT. 31, 1969
TRAVEL EXPENSES--RELEASE FROM ACTIVE DUTY--CONSTRUCTIVE COSTS
CLAIM FOR ADDITIONAL TRAVEL ALLOWANCE INCIDENT TO CLAIMANT'S OVERSEAS
RELEASE FROM ACTIVE MILITARY DUTY IS DISALLOWED, AS REGULATIONS AT TIME
OF RELEASE PROVIDED THAT MILEAGE WAS PAYABLE FOR DISTANCE BETWEEN
OVERSEAS LAST DUTY STATION (FRANKFURT, GERMANY), AND NEAREST PORT OF
EMBARKATION (RHEIN-MAIN AIR FORCE BASE), AND BETWEEN APPROPRIATE UNITED
STATES PORT OF DEBARKATION (NEW ORLEANS, LA.) AND PLACE TO WHICH HE
ELECTED TO RECEIVE TRAVEL ALLOWANCE (HOUSTON, TEX.); BECAUSE CLAIMANT
ELECTED TRAVEL ALLOWANCE RATHER THAN TRANSPORTATION OR REIMBURSEMENT
THEREFOR, REGULATIONS DO NOT AUTHORIZE FURTHER TRANSPORTATION AT
GOVERNMENT EXPENSE FOR SUBSEQUENTLY PERFORMED TRAVEL FROM UNITED STATES
PORT OF DEBARKATION, EVEN THOUGH DISTANCE TO CLAIMANT'S HOME FROM PORT
TO WHICH TRANSPORTATION WAS PROVIDED (MCGUIRE AIR FORCE BASE, N.J.) IS
GREATER THAN FROM PORT USED IN COMPUTING ALLOWANCE. SEE 47 COMP. GEN.
77.
TO MR. CHARLES M. HEYDA:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF SEPTEMBER 3, 1969, IN
EFFECT REQUESTING RECONSIDERATION OF THE SETTLEMENT DATED JULY 18, 1969,
WHICH DISALLOWED YOUR CLAIM FOR ADDITIONAL TRAVEL ALLOWANCE INCIDENT TO
YOUR RELEASE FROM ACTIVE DUTY IN THE UNITED STATES ARMY.
SPECIAL ORDERS 154, DATED SEPTEMBER 12, 1967, ISSUED BY HEADQUARTERS,
MOVEMENTS CONTROL CENTER, U.S. ARMY TRAFFIC MANAGEMENTS AGENCY, CENTRAL
EUROPE, RELEASED YOU FROM ACTIVE DUTY ON SEPTEMBER 15, 1967, AND STATED
THAT YOU WOULD RESIDE IN THE EUROPEAN COMMAND FOR APPROXIMATELY TWO
MONTHS FOR PERSONAL REASONS. AT THE TIME OF YOUR RELEASE FROM ACTIVE
DUTY YOU WERE PAID TRAVEL ALLOWANCE FOR THE DISTANCE FROM FRANKFURT,
GERMANY, TO RHEIN-MAIN AIR FORCE BASE, PORT OF EMBARKATION, AND FROM NEW
ORLEANS, LOUISIANA, PORT OF DEBARKATION, TO HOUSTON, TEXAS, IN THE
AMOUNT OF $22.20 (370 MILES @ 6 CENTS MILE).
YOU SAY IN YOUR LETTER OF SEPTEMBER 3, 1969, THAT IN SPITE OF YOUR
REQUEST FOR TRANSPORTATION FROM FRANKFURT, GERMANY, TO NEW ORLEANS,
LOUISIANA, THE ONLY ROUTE AVAILABLE TO YOU AT THE TIME OF YOUR RETURN TO
THE UNITED STATES WAS THE FRANKFURT-MCGUIRE ROUTE WHICH YOU WERE OBLIGED
TO ACCEPT. YOU ALSO SAY THAT WHILE THE JOINT TRAVEL REGULATIONS LISTED
NEW ORLEANS AS THE APPROPRIATE PORT OF DEBARKATION, THAT PORT WAS NOT
AVAILABLE TO YOU, AND YOU CONTEND THAT THE ARMY WAS OBLIGATED TO PROVIDE
YOU WITH TRANSPORTATION FROM YOUR POINT OF SEPARATION TO YOUR HOME OF
RECORD WHICH IT FAILED TO DO.
YOU WERE ADVISED IN THE SETTLEMENT OF JULY 18, 1969, THAT PARAGRAPH
M4159-5 OF THE JOINT TRAVEL REGULATIONS, PROMULGATED PURSUANT TO THE
AUTHORITY CONTAINED IN 37 U.S.C. 404, PROVIDES AUTHORITY FOR THE PAYMENT
OF MILEAGE WHEN NO TRAVEL IS TO BE PERFORMED INCIDENT TO SEPARATION FROM
THE SERVICE OR RELEASE FROM ACTIVE DUTY. THIS PARAGRAPH PROVIDED DURING
THE PERIOD INVOLVED, WITH AN EXCEPTION NOT HERE MATERIAL, THAT WHEN THE
MEMBER'S LAST DUTY STATION WAS LOCATED OUTSIDE THE UNITED STATES AND THE
PLACE TO WHICH THE MEMBER ELECTED TO RECEIVE TRAVEL ALLOWANCES WAS
LOCATED WITHIN THE UNITED STATES, MILEAGE WAS PAYABLE FOR THE OFFICIAL
DISTANCE BETWEEN THE MEMBER'S LAST DUTY STATION AND THE NEAREST PORT OF
EMBARKATION FROM WHICH TRANSPORTATION COULD HAVE BEEN FURNISHED TO THE
UNITED STATES AND BETWEEN THE APPROPRIATE PORT OF DEBARKATION IN THE
UNITED STATES AND THE PLACE TO WHICH THE MEMBER ELECTED TO RECEIVE
TRAVEL ALLOWANCES.
THE REGULATIONS PROVIDED THAT IN DETERMINING THE APPROPRIATE PORT OF
DEBARKATION FOR SUCH PURPOSE IN CASES WHERE, AS IN YOUR CASE, THE
MEMBER'S LAST DUTY STATION WAS LOCATED OUTSIDE THE UNITED STATES EAST OF
100 DEGREES WEST LONGITUDE, BUT WEST OF 100 DEGREES EAST LONGITUDE, THE
PORT OF NEW YORK, NEW YORK, NEW ORLEANS, LOUISIANA, OR NORFOLK,
VIRGINIA, WHICHEVER INVOLVED THE LESSER DISTANCE IN THE UNITED STATES,
WOULD APPLY. ACCORDINGLY, YOU WERE ADVISED IN THE SETTLEMENT OF JULY
18, 1969, THAT NEW ORLEANS INVOLVED THE LESSER DISTANCE TO YOUR HOME OF
RECORD AT HOUSTON, TEXAS, AND IT WAS THE APPROPRIATE PORT FROM WHICH
MILEAGE ALLOWANCE COULD BE ALLOWED INCIDENT TO YOUR RELEASE FROM ACTIVE
DUTY.
YOU BECAME ENTITLED UNDER THE REGULATIONS TO THE TRAVEL ALLOWANCE
FROM YOUR OVERSEAS STATION TO THE PLACE YOU ELECTED IN THE UNITED STATES
AT THE TIME OF YOUR SEPARATION FROM THE ARMY ON SEPTEMBER 15, 1967,
SINCE YOU REQUESTED OVERSEAS SEPARATION. YOUR CLAIM FOR ADDITIONAL
TRAVEL ALLOWANCE IS BASED ON CONDITIONS THAT YOU SAY EXISTED WHEN YOU
RETURNED TO THE UNITED STATES ON JULY 17, 1968, BY GOVERNMENT PLANE.
IF YOU HAD RETURNED TO THE UNITED STATES FOR SEPARATION FROM THE ARMY
THE GOVERNMENT WOULD HAVE FURNISHED YOU TRANSPORTATION, OR REIMBURSEMENT
THEREFOR, FROM YOUR OVERSEAS STATION TO YOUR RESIDENCE IN THIS COUNTRY.
HOWEVER, BECAUSE OF YOUR ELECTION TO RECEIVE TRAVEL ALLOWANCE UPON YOUR
OVERSEAS SEPARATION, THE CITED REGULATIONS NEITHER CONTEMPLATE NOR
AUTHORIZE FURTHER TRANSPORTATION AT GOVERNMENT EXPENSE FOR SUBSEQUENTLY
PERFORMED TRAVEL FROM A PORT OF DEBARKATION IN THE UNITED STATES EVEN
THOUGH THE DISTANCE TO YOUR HOME FROM THE PORT TO WHICH YOU WERE
PROVIDED TRANSPORTATION MAY BE GREATER THAN FROM THE PORT USED IN
COMPUTING YOUR MILEAGE ALLOWANCE. SEE DECISION OF JULY 27, 1967,
B-161834, COPY ENCLOSED.
B-167978, OCT. 31, 1969
TRANSPORTATION--DEPENDENTS--CHANGES IN GRADE OR RANK
PREVIOUS $125 SETTLEMENT OF FORMER AIR FORCE MEMBER'S $317 CLAIM FOR
REIMBURSEMENT OF COST OF WIFE'S COMMERCIAL AIR TRAVEL FROM GUAM TO SAN
FRANCISCO INCIDENT TO HIS SEPARATION FROM SERVICE IS SUSTAINED AS
CLAIMANT WAS NOT ENTITLED TO REIMBURSEMENT FOR COST OF COMMERCIAL AIR
TRANSPORTATION FOR HIS WIFE, HOWEVER UPON PROMOTION TO E-5 HE WAS
ENTITLED TO REIMBURSEMENT FOR HER TRAVEL NOT IN EXCESS OF AMOUNT AIR
FORCE WOULD HAVE HAD TO PAY FOR GOVERNMENT TRANSPORTATION FOR HER; BASE
PERSONNEL APPARENTLY ADVISED CLAIMANT OF NONENTITLEMENT TO TRAVEL
PRIVILEGES FOR WIFE PRIOR TO HIS PROMOTION TO E-5, WHEN HE WAS
INELIGIBLE FOR WIFE'S TRANSPORTATION AT GOVERNMENT EXPENSE, THUS IT
APPEARS HE WAS NOT INCORRECTLY ADVISED.
TO MR. CARROLL K. DUNAWAY:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED SEPTEMBER 9, 1969,
REQUESTING RECONSIDERATION OF OUR SETTLEMENT DATED AUGUST 21, 1969,
WHICH ALLOWED THE SUM OF $125 IN CONNECTION WITH YOUR CLAIM FOR $317 AS
REIMBURSEMENT FOR YOUR WIFE'S TRAVEL FROM ANDERSON AIR BASE, GUAM, TO
SAN FRANCISCO, CALIFORNIA, ON SEPTEMBER 1, 1968.
THE RECORD SHOWS THAT WHILE SERVING AS SERGEANT IN PAY GRADE E-4,
WITH THE UNITED STATES AIR FORCE, BY ORDERS DATED JUNE 24, 1968, YOU
WERE RELIEVED FROM YOUR OVERSEAS DUTY STATION, APO SAN FRANCISCO 96334,
AND DIRECTED TO PROCEED ON THE DATE ELIGIBLE FOR RETURN FROM OVERSEAS,
IN SEPTEMBER 1968, TO TRAVIS AIR FORCE BASE, CALIFORNIA, FOR SEPARATION
FROM THE SERVICE. ALSO, THE RECORD SHOWS THAT SPECIAL ORDER A-42070,
DEPARTMENT OF THE AIR FORCE, HEADQUARTERS, 3RD AIR DIVISION (SAC) APO
SAN FRANCISCO 96334, SEPTEMBER 1, 1968, ANNOUNCED YOUR PROMOTION TO THE
PERMANENT GRADE OF STAFF SERGEANT, PAY GRADE E-5, EFFECTIVE ON THAT
DATE.
ON SEPTEMBER 1, 1968, THE DATE OF YOUR PROMOTION, YOUR WIFE TRAVELED
BY COMMERCIAL AIR FROM YOUR LAST DUTY STATION, ANDERSON AIR BASE, GUAM,
TO SAN FRANCISCO, CALIFORNIA, AT PERSONAL EXPENSE. BY ORDERS DATED
SEPTEMBER 5, 1968, HEADQUARTERS, MILITARY AIR COMMAND, TRAVIS AIR FORCE
BASE, CALIFORNIA 94335, YOU WERE RELIEVED FROM ACTIVE DUTY WITH THE
UNITED STATES AIR FORCE AND TRANSFERRED TO THE UNITED STATES AIR FORCE
RESERVE.
IN SUBMITTING YOUR CLAIM YOU EXPLAINED THAT YOU WERE TOLD BY THE
TRAVEL AND PERSONNEL DEPARTMENTS AT ANDERSON AIR BASE THAT AS AN E-5 YOU
WERE NOT ENTITLED TO TRAVEL PRIVILEGES FOR YOUR WIFE. CONSEQUENTLY, YOU
PURCHASED A COMMERCIAL PLANE TICKET FOR HER RETURN TO THE UNITED STATES.
SINCE THE RECORD SHOWS YOU WERE A STAFF SERGEANT WHEN YOUR WIFE
PERFORMED THE TRAVEL, AND ELIGIBLE FOR TRANSPORTATION FOR YOUR WIFE, BY
SETTLEMENT DATED AUGUST 21, 1969, YOU WERE ALLOWED THE SUM OF $125
REPRESENTING THE APPLICABLE TARIFF CHARGE THE AIR FORCE WOULD HAVE BEEN
REQUIRED TO PAY FOR THE AVAILABLE GOVERNMENT TRANSPORTATION.
IN YOUR PRESENT LETTER YOU INSIST THAT YOU SHOULD BE ALLOWED THE
ADDITIONAL AMOUNT SINCE YOUR WIFE HAD TO TRAVEL BY COMMERCIAL AIR
BECAUSE OF A MISTAKE MADE BY MILITARY PERSONNEL AT ANDERSON AIR BASE AND
YOU SHOULD NOT HAVE TO PAY FOR THEIR MISTAKE.
PARAGRAPH M7000-1, JOINT TRAVEL REGULATIONS, PROMULGATED PURSUANT TO
THE PERTINENT STATUTE, 37 U.S.C. 406, PROVIDES THAT MEMBERS OF THE
UNIFORMED SERVICES ARE ENTITLED TO TRANSPORTATION OF DEPENDENTS AT
GOVERNMENT EXPENSE UPON A PERMANENT CHANGE OF STATION FOR TRAVEL
PERFORMED FROM THE OLD TO THE NEW STATION OR AS OTHERWISE AUTHORIZED,
EXCEPT ENLISTED MEMBERS IN PAY GRADE E-4, WITH 4 YEARS SERVICE OR LESS,
OR IN A LOWER PAY GRADE.
PARAGRAPH M7009-1 OF THE REGULATIONS PROVIDES THAT A MEMBER ON ACTIVE
DUTY WHO IS SEPARATED FROM THE SERVICE OR RELIEVED FROM ACTIVE DUTY WILL
BE ENTITLED TO TRANSPORTATION OF HIS DEPENDENTS NOT TO EXCEED THE
DISTANCE FROM HIS LAST STATION, OR THE PLACE TO WHICH THEY WERE LAST
TRANSPORTED AT GOVERNMENT EXPENSE, TO THE PLACE TO WHICH THE MEMBER
ELECTS TO RECEIVE TRAVEL ALLOWANCES FOR HIS TRAVEL UNDER THE PROVISIONS
OF PARAGRAPH M4157. SUCH PROVISION, HOWEVER, APPLIES ONLY TO A MEMBER
WHO IS OTHERWISE ELIGIBLE FOR TRANSPORTATION OF HIS DEPENDENTS AT
GOVERNMENT EXPENSE.
PARAGRAPH M7002-1B OF THE REGULATIONS PROVIDES THAT FOR TRANSOCEANIC
TRAVEL OF DEPENDENTS TO, FROM, OR BETWEEN AREAS OUTSIDE THE UNITED
STATES, GOVERNMENT AIRCRAFT OR VESSELS WILL BE UTILIZED, IF AVAILABLE,
EXCEPT IN CERTAIN CIRCUMSTANCES, NONE OF WHICH ARE PERTINENT HERE.
PARAGRAPH M7002-2B OF THE REGULATIONS PROVIDES THAT FOR TRANSOCEANIC
TRAVEL OF DEPENDENTS THE MEMBER MAY BE REIMBURSED IN THE SAME MANNER AS
IS PROVIDED FOR HIS PERSONAL TRAVEL IN PARAGRAPH M4159-4, EXCEPT THAT
WHEN TRANSPORTATION VIA GOVERNMENT VESSEL IS NOT AVAILABLE AND
DEPENDENTS REFUSE TO TRAVEL BY GOVERNMENT AIRCRAFT, REIMBURSEMENT FOR
COMMERCIAL TRANSPORTATION COSTS WILL NOT EXCEED THE COST OF PASSAGE BY
COMMERCIAL VESSEL.
PARAGRAPH M4159-4 OF THE REGULATIONS PROVIDES THAT WHEN TRAVEL BY
GOVERNMENT TRANSPORTATION IS AUTHORIZED (AS DISTINGUISHED FROM DIRECTED)
AND THE MEMBER PERFORMS TRANSOCEANIC TRAVEL BY ANOTHER MODE OF
TRANSPORTATION (OTHER THAN BY FOREIGN-FLAG) AT PERSONAL EXPENSE, THE
MEMBER IS ENTITLED TO REIMBURSEMENT FOR THE COST OF THE TRANSPORTATION
UTILIZED NOT TO EXCEED THE APPLICABLE TARIFF CHARGE WHICH THE SPONSORING
SERVICE WOULD HAVE BEEN REQUIRED TO PAY FOR THE AVAILABLE GOVERNMENT
TRANSPORTATION.
AUTHORIZATION FOR YOUR WIFE'S TRAVEL WAS NOT INCLUDED IN YOUR ORDERS
OF JUNE 24, 1968, PRESUMABLY FOR THE REASON THAT AS A SERGEANT IN PAY
GRADE E-4, YOU HAD NOT COMPLETED 4 YEARS OF SERVICE AND, THEREFORE, WERE
IN AN INELIGIBLE PAY GRADE FOR DEPENDENT TRAVEL. SINCE YOUR WIFE
PERFORMED THE TRAVEL ON SEPTEMBER 1, 1968, HOWEVER, THE EFFECTIVE DATE
OF YOUR PROMOTION TO STAFF SERGEANT, PAY GRADE E-5, OUR CLAIMS DIVISION
CONSIDERED THAT YOUR WIFE'S TRAVEL WAS AUTHORIZED AND THAT YOU WERE
ENTITLED TO REIMBURSEMENT AS OTHERWISE PROVIDED BY THE REGULATIONS.
WHERE A MEMBER'S DEPENDENTS ARE AUTHORIZED, AS DISTINGUISHED FROM
SPECIFICALLY DIRECTED, TO USE GOVERNMENT TRANSPORTATION FOR OVERSEAS
TRAVEL AND USE COMMERCIAL TRANSPORTATION AT PERSONAL EXPENSE, THE MEMBER
MAY BE REIMBURSED UNDER THE APPLICABLE PROVISIONS OF THE JOINT TRAVEL
REGULATIONS FOR THE COST OF SUCH TRAVEL ON THE BASIS OF THE STANDARD
PRICES WHICH THE SPONSORING SERVICE WOULD HAVE BEEN REQUIRED TO PAY HAD
THE TRAVEL BEEN BY GOVERNMENT TRANSPORTATION. SEE 40 COMP. GEN. 482
(1961) AND 41 COMP. GEN. 100 (1961), COPIES HEREWITH.
PARAGRAPH 3308, AIR FORCE MANUAL 75-4, DATED MAY 10, 1963, WHICH WAS
IN EFFECT AT THE TIME TRAVEL WAS PERFORMED, PROVIDES THAT THE NORMAL
ROUTING OF PERSONNEL TO AND FROM OVERSEAS IS CONTAINED IN ATTACHMENT 36
OF THE MANUAL. THE ROUTING AND MODE OF TRAVEL FROM GUAM TO CONTINENTAL
UNITED STATES SET FORTH IN ATTACHMENT 36 IS BY MILITARY AIRLIFT COMMAND
FROM ANDERSON AIR BASE, GUAM, TO TRAVIS AIR FORCE BASE, CALIFORNIA,
WHICH IS IN THE VICINITY OF SAN FRANCISCO.
BASED ON THE FOREGOING REGULATIONS, YOU WERE NOT ENTITLED TO
REIMBURSEMENT FOR THE COST OF COMMERCIAL AIR TRANSPORTATION FOR YOUR
WIFE FROM ANDERSON AIR BASE, GUAM, TO SAN FRANCISCO, CALIFORNIA.
HOWEVER, ON THE BASIS EXPLAINED ABOVE YOU WERE ENTITLED TO REIMBURSEMENT
FOR YOUR WIFE'S TRAVEL FROM ANDERSON AIR BASE, GUAM, TO SAN FRANCISCO,
CALIFORNIA, NOT IN EXCESS OF THE AMOUNT THE AIR FORCE WOULD HAVE HAD TO
PAY FOR GOVERNMENT TRANSPORTATION FOR HER BETWEEN SUCH POINTS.
CONCERNING YOUR STATEMENT THAT YOU SHOULD NOT HAVE TO PAY THE
ADDITIONAL COST OF THE COMMERCIAL AIR FARE FOR YOUR WIFE BECAUSE OF A
MISTAKE BY MILITARY PERSONNEL AT ANDERSON AIR BASE, IT APPEARS FROM THE
RECORD THAT THE ANDERSON AIR BASE PERSONNEL ADVISED YOU CONCERNING YOUR
WIFE'S DEPENDENT TRANSPORTATION AT GOVERNMENT EXPENSE PRIOR TO SEPTEMBER
1, 1968, AT WHICH TIME YOU WERE STILL IN PAY GRADE E-4 AND, IT IS
ASSUMED, WERE NOT ELIGIBLE FOR HER TRANSPORTATION AT GOVERNMENT EXPENSE.
THEREFORE, THE INFORMATION THEY GAVE YOU PRIOR TO YOUR PROMOTION
APPARENTLY WAS CORRECT. THE FACT THAT YOUR WIFE DEPARTED ON THE DAY OF
YOUR PROMOTION WITHOUT OBTAINING GOVERNMENT TRANSPORTATION AFFORDS NO
BASIS TO REIMBURSE YOU FOR THE EXCESS COST OF COMMERCIAL TRANSPORTATION.
ACCORDINGLY, THE SETTLEMENT OF AUGUST 21, 1969, IS CORRECT AND IS
SUSTAINED.
B-168139, OCT. 31, 1969
MILEAGE--TRAVEL BY PRIVATELY OWNED AUTOMOBILE--BETWEEN RESIDENCE AND
HEADQUARTERS
EMPLOYEE WHO REFUSED TO EXECUTE AGREEMENT TO REMAIN WITH GOVERNMENT
FOR 12 MONTHS FOLLOWING EFFECTIVE DATE OF TRANSFER FROM NAVAL SECURITY
STATION, WASHINGTON, D.C. TO FORT GEORGE G. MEADE, MD. AS REQUIRED BY 5
U.S.C. 5724 (I) IS NOT ENTITLED TO EXPENSES AND ALLOWANCES IN CONNECTION
WITH TRANSFER. ALSO SINCE NOTHING IN PAPERS PRESENTED WITH CLAIM
INDICATED CHANGE OF RESIDENCE AT TIME TRANSFER OF OFFICIAL STATION WAS
EFFECTIVE, VOUCHER PRESENTED FOR MILEAGE REIMBURSEMENT FOR 26 MILES BY
PRIVATELY OWNED AUTOMOBILE WAS ASSUMED TO BE TRAVEL BETWEEN RESIDENCE
AND NEW PLACE OF DUTY FOR WHICH REIMBURSEMENT IS NOT AUTHORIZED,
GOVERNMENT EMPLOYEES NOT BEING ENTITLED TO REIMBURSEMENT FOR TRAVEL
BETWEEN RESIDENCE AND PLACE OF DUTY.
TO MR. GILBERT H. DAWSON:
WE REFER TO YOUR MEMORANDUM TO THE ASSISTANT SECRETARY OF DEFENSE
(ADMINISTRATION), DATED JULY 28, 1969, YOUR REFERENCE SERIAL: D5/1328F,
WHICH WAS FORWARDED TO US BY THE PER DIEM, TRAVEL AND TRANSPORTATION
ALLOWANCE COMMITTEE ON OCTOBER 14, 1969, UNDER PDTATAC CONTROL NO.
69-32.
YOU REQUEST OUR DECISION WHETHER YOU MAY PAY THE CLAIM OF MR. PHILIP
W. IDE FOR MILEAGE AND PER DIEM INCIDENT TO HIS CHANGE OF OFFICIAL
STATION FROM THE NAVAL SECURITY STATION, WASHINGTON, D.C., TO FORT
GEORGE G. MEADE, MARYLAND, WHICH WAS EFFECTIVE MAY 20, 1968, IN VIEW OF
THE FACT THAT HE REFUSED TO SIGN AN AGREEMENT TO REMAIN WITH THE
GOVERNMENT FOR 12 MONTHS FOLLOWING THE EFFECTIVE DATE OF HIS TRANSFER AS
REQUIRED BY 5 U.S.C. 5724 (I) UNTIL MAY 1969 WHEN THE 12 MONTHS HAD
EXPIRED.
THERE IS NO INDICATION IN THE PAPERS PRESENTED WITH THE CLAIM THAT
MR. IDE CHANGED HIS RESIDENCE AT THE TIME THE TRANSFER OF OFFICIAL
STATION WAS EFFECTIVE. IN THE VOUCHER PRESENTED HE CLAIMS MILEAGE
REIMBURSEMENT FOR TRAVEL BY PRIVATELY OWNED AUTOMOBILE OF 26 MILES ON
THE BASIS OF SPEEDOMETER READINGS FURNISHED. HE INDICATES THAT TRAVEL
WAS PERFORMED FROM 6:30 A.M. TO 7:30 A.M. ON MAY 20, BUT DOES NOT SHOW
THE PLACES BETWEEN WHICH TRAVEL WAS PERFORMED. ON THE BASIS OF THE
INFORMATION NOW BEFORE US WE CAN ONLY ASSUME THAT MR. IDE TRAVELED
BETWEEN HIS RESIDENCE AND HIS PLACE OF WORK AT THE NAVAL SECURITY
STATION ON HIS LAST WORKDAY PRECEDING MAY 20 AND THAT HE TRAVELED
BETWEEN HIS RESIDENCE AND HIS PLACE OF WORK AT FORT GEORGE G. MEADE ON
MAY 20.
IF OUR ASSUMPTION IN THAT REGARD IS CORRECT, MR. IDE IS NOT ENTITLED
TO THE REIMBURSEMENT CLAIMED BECAUSE HE PERFORMED NO TRAVEL AS A RESULT
OF THE CHANGE OF HIS OFFICIAL STATION. THE TRAVEL HE PERFORMED ON HIS
LAST DAY OF WORK AT THE NAVAL SECURITY STATION AND ON HIS FIRST DAY OF
WORK AT FORT GEORGE G. MEADE DOES NOT ENTITLE HIM TO PAYMENT OF MILEAGE
OR PER DIEM BECAUSE A GOVERNMENT EMPLOYEE IS NOT ENTITLED TO
REIMBURSEMENT FOR TRAVEL BETWEEN HIS RESIDENCE AND HIS PLACE OF DUTY AT
HIS OFFICIAL STATION. 16 COMP. GEN. 64 (1936); 27 ID. 1 (1947).
REGARDING YOUR GENERAL QUESTIONS WE NOTE THAT THE SIGNING OF A 12
MONTH SERVICE AGREEMENT BY THE EMPLOYEE IS A CONDITION PRECEDENT TO THE
PAYMENT OF ANY OF THE EXPENSES AND ALLOWANCES OTHERWISE AUTHORIZED IN
CONNECTION WITH HIS TRANSFER. HOWEVER, THERE IS NO REQUIREMENT IN THE
LAW OR APPLICABLE REGULATIONS THAT SUCH AN AGREEMENT BE SIGNED PRIOR TO
PERFORMANCE OF TRAVEL AND TRANSPORTATION INCIDENT TO A CHANGE OF
OFFICIAL STATION EXCEPT AS SPECIFICALLY REQUIRED IN THE CASE OF TRAVEL
FOR A HOUSE HUNTING TRIP UNDER SECTION 2.4C (3) OF BUREAU OF THE BUDGET
CIRCULAR NO. A-56, AS AMENDED, JUNE 26, 1969. ANY PAYMENT MADE BY THE
GOVERNMENT FOR EXPENSES AND ALLOWANCES AUTHORIZED IN CONNECTION WITH A
TRANSFER, WHETHER MADE DIRECTLY TO THE EMPLOYEE OR BY ISSUANCE OF
GOVERNMENT TRANSPORTATION REQUESTS OR GOVERNMENT BILLS OF LADING IS
IMPROPER UNLESS THE REQUIRED AGREEMENT HAS BEEN SIGNED. ALTHOUGH NOT
SPECIFICALLY REQUIRED BY LAW OR REGULATION WE BELIEVE THAT TRAVEL
ADVANCES FOR TRANSFER EXPENSES AS AUTHORIZED IN CIRCULAR NO. A-56
SHOULD BE MADE ONLY AFTER THE AGREEMENT REQUIRED FOR ENTITLEMENT TO
PAYMENT OF EXPENSES INCURRED HAS BEEN SIGNED.
IN VIEW OF THE CONCLUSION REACHED ABOVE TO THE EFFECT THAT MR. IDE IS
NOT ENTITLED TO REIMBURSEMENT OF THE AMOUNTS CLAIMED UNDER THE FACTS
GIVEN, WE ARE NOT IN A POSITION TO ANSWER YOUR GENERAL QUESTIONS EXCEPT
AS ANSWERS MAY BE CONTAINED IN THE ABOVE DISCUSSION OF THE BASIC
AUTHORITIES INVOLVED. ANY VOUCHER PRESENTED TO YOU FOR DISBURSEMENT
INVOLVING AN EMPLOYEE WHO HAS REFUSED TO SIGN THE REQUIRED AGREEMENT
UNTIL AFTER THE 12 MONTH PERIOD OF SERVICE AT HIS NEW OFFICIAL STATION
HAS EXPIRED SHOULD BE SUBMITTED FOR OUR CONSIDERATION.
B-153107, OCT. 30, 1969
COMPENSATION--OVERTIME--INSPECTIONAL SERVICE
EMPLOYEES--HOLIDAYS--EXECUTIVE ORDER, ETC.
TREASURY SECRETARY IS ADVISED CUSTOMS EMPLOYEES WHO WERE PAID HOLIDAY
PAY FOR JULY 21, 1969, WHICH PRESIDENTIAL PROCLAMATION AND MEMORANDUM
DATED JULY 16 DESIGNATED AS HOLIDAY FOR GOVERNMENT EMPLOYEES "WITHIN
MEANING OF EXECUTIVE ORDER NO. 10358 OF JUNE 9, 1952 * * *" AND OF ALL
COMPENSATION AND LEAVE STATUTES, INCIDENT TO APOLLO 11 MOON LANDING, ARE
CONSIDERED TO HAVE RECEIVED ERRONEOUS PAYMENTS OF PAY WHICH ARE SUBJECT
TO CONSIDERATION FOR WAIVER UNDER PUB. L. 90-616, SINCE ORDERS IN SAID
PROCLAMATION SHOULD BE GIVEN SAME FORCE AND EFFECT AS IF CONTAINED IN
NUMBERED EXECUTIVE ORDER AND IT HAS BEEN HELD CUSTOMS OVERTIME
PROVISIONS IN 1911 AND 1930 ACTS DO NOT APPLY TO HOLIDAYS ESTABLISHED BY
EXECUTIVE ORDER. SEE 26 COMP.
GEN. 848. FEES--SERVICES TO PUBLIC--INSPECTIONAL SERVICE
EMPLOYEES--HOLIDAY PAY
TREASURY SECRETARY IS ADVISED THAT THOSE WHO USED CUSTOMS SERVICES ON
JULY 21, 1969, DAY DESIGNATED AS HOLIDAY FOR GOVERNMENT EMPLOYEES BY
PRESIDENTIAL PROCLAMATION AND MEMORANDUM DATED JULY 16, 1969, INCIDENT
TO APOLLO 11 MOON LANDING, SHOULD NOT BE REQUIRED TO REIMBURSE
GOVERNMENT AS PROVIDED IN 1930 ACT, AND ANY MONEY COLLECTED FOR SUCH
SERVICES SHOULD BE REFUNDED SINCE FOR PURPOSES OF APPLYING CUSTOMS
OVERTIME LAW, DAYS WHICH ARE DECLARED TO BE HOLIDAYS FOR GOVERNMENT
EMPLOYEES BY EXECUTIVE ORDER ARE NOT TO BE CONSIDERED HOLIDAYS, AND
ORDERS IN AFORESAID PROCLAMATION ARE BELIEVED TO HAVE SAME FORCE AND
EFFECT AS IF THEY HAD BEEN CONTAINED IN EXECUTIVE ORDER. SEE 26 COMP.
GEN. 848.
TO MR. SECRETARY:
WE REFER TO THE LETTER DATED AUGUST 26, 1969, OF YOUR ASSISTANT
SECRETARY, YOUR REFERENCE CC 191 G, CONCERNING THE APPLICABILITY OF THE
CUSTOMS OVERTIME AND HOLIDAY LAW, SECTION 5 OF THE ACT OF FEBRUARY 13,
1911, CHAPTER 46, 36 STAT. 901, AS AMENDED, 19 U.S.C. 267, AND THE
RELATED PROVISIONS OF SECTION 451 OF THE ACT OF JUNE 17, 1930, CHAPTER
497, 46 STAT. 715, AS AMENDED, 19 U.S.C. 1451, TO SERVICES OTHERWISE
COVERED BY THOSE PROVISIONS WHICH WERE PERFORMED BY EMPLOYEES OF THE
BUREAU OF CUSTOMS ON JULY 21, 1969, WHICH THE PRESIDENT DESIGNATED AS A
HOLIDAY FOR GOVERNMENT EMPLOYEES IN CONNECTION WITH THE APOLLO 11
LANDING ON THE MOON.
PRESIDENTIAL PROCLAMATION 3919, JULY 16, 1969, DIRECTED GOVERNMENT
AGENCIES TO BE CLOSED ON JULY 21, 1969, AND EXCUSED EMPLOYEES, OTHER
THAN THOSE WHO WERE REQUIRED TO BE AT THEIR POSTS FOR REASONS OF
NATIONAL SECURITY OR OTHER PUBLIC REASONS, FROM DUTY ON THAT DAY. IN A
MEMORANDUM OF THE SAME DATE, THE PRESIDENT DIRECTED THAT JULY 21 SHOULD
"BE CONSIDERED A HOLIDAY WITHIN THE MEANING OF EXECUTIVE ORDER NO. 10358
OF JUNE 9, 1952, AND OF ALL STATUTES SO FAR AS THEY RELATE TO THE
COMPENSATION AND LEAVE OF EMPLOYEES OF THE UNITED STATES.'
WE BELIEVE THAT THE PRESIDENT'S ORDERS AS CONTAINED IN PROCLAMATION
3919 AND HIS MEMORANDUM OF JULY 16 SHOULD BE GIVEN THE SAME FORCE AND
EFFECT AS IF THEY HAD BEEN CONTAINED IN A NUMBERED EXECUTIVE ORDER FOR
PURPOSE OF LAWS RELATING TO THE OBSERVANCE OF HOLIDAYS ESTABLISHED BY
,EXECUTIVE ORDER.'
WE HELD IN THE DECISION 26 COMP. GEN. 848 AT 852 THAT THE CUSTOMS
OVERTIME PROVISIONS CONTAINED IN THE 1911 AND 1930 ACTS DO NOT APPLY TO
HOLIDAYS ESTABLISHED BY EXECUTIVE ORDER BUT ONLY TO ,THOSE HOLIDAYS
SPECIFICALLY SET OUT, WHICH DAYS GENERALLY ARE UNDERSTOOD NOT ONLY BY
GOVERNMENT EMPLOYEES BUT BY THE PUBLIC TO BE HOLIDAYS.'
WE DO NOT BELIEVE THAT THE ENACTMENT OF THE ACT OF SEPTEMBER 22,
1959, PUBLIC LAW 86-362, NOW CODIFIED AS 5 U.S.C. 6103 (B), PROVIDES A
BASIS FOR CHANGING THE CONCLUSION REACHED IN THAT DECISION SINCE THAT
ACT DOES NOT PURPORT TO FIX HOLIDAYS BUT MERELY PROVIDES RULES FOR
ENTITLEMENT OF GOVERNMENT EMPLOYEES TO HOLIDAY PAY FOR HOLIDAYS WHICH
OCCUR ON SATURDAY. IN THAT CONNECTION WE NOTE THAT THE ACT OF JUNE 29,
1938 (5 U.S.C. 86A (1964 ED.), NOW 5 U.S.C. 6104), IN EXISTENCE AT THE
TIME THE DECISION IN QUESTION (26 COMP. GEN. 848) WAS RENDERED ALSO
RECOGNIZED THE EXISTENCE OF HOLIDAYS DECLARED BY EXECUTIVE ORDER AS WELL
AS SPECIFIC HOLIDAYS FOR THE PURPOSE OF GRANTING HOLIDAY PAY TO DAILY,
HOURLY AND PIECEWORK EMPLOYEES.
IN THE DECISION 26 COMP. GEN. 848 WE RECOGNIZED THAT THE CUSTOMS
OVERTIME PAY PROVISIONS HAD BEEN CONSIDERED AS NOT APPLICABLE TO
HOLIDAYS DECLARED BY EXECUTIVE ORDER "FOR ALMOST 36 YEARS.' APPARENTLY,
THAT RULE HAS NOW BEEN APPLIED FOR ALMOST 59 YEARS EXCEPT WITH REGARD TO
JULY 21, 1969, WHICH WE UNDERSTAND THE BUREAU OF CUSTOMS HAS TREATED AS
A HOLIDAY UNDER THE PROVISIONS OF 19 U.S.C. 267 AND 1451.
WE DO NOT FIND A SUFFICIENT BASIS IN LAW TO CHANGE THE RULE WHICH HAS
BEEN APPLIED FOR SO MANY YEARS TO THE PAYMENT OF HOLIDAY PAY UNDER CITED
PROVISIONS OF LAW. ACCORDINGLY, FOR PURPOSES OF APPLYING THE CUSTOMS
OVERTIME LAW, DAYS WHICH ARE DECLARED TO BE HOLIDAYS FOR GOVERNMENT
EMPLOYEES BY EXECUTIVE ORDER ARE NOT TO BE CONSIDERED HOLIDAYS.
CONCERNING THE ACTIONS TAKEN BY THE BUREAU OF CUSTOMS WITH REGARD TO
JULY 21, 1969, THOSE WHO USED CUSTOMS SERVICES ON THAT DAY SHOULD NOT BE
REQUIRED TO REIMBURSE THE GOVERNMENT AS PROVIDED IN THE 1930 ACT AND ANY
MONEY COLLECTED FOR SUCH SERVICES SHOULD BE REFUNDED. CUSTOMS EMPLOYEES
WHO WERE PAID HOLIDAY PAY FOR THAT DAY MAY BE CONSIDERED TO HAVE
RECEIVED AN ERRONEOUS PAYMENT OF PAY THE RECOVERY OF WHICH MAY BE
CONSIDERED FOR WAIVER UNDER THE PROVISIONS OF 5 U.S.C. 5584 (THE ACT OF
OCTOBER 21, 1968, PUBLIC LAW 90-616) AND THE REGULATIONS ISSUED PURSUANT
THERETO (4 CFR 201-203.
B-167794, OCT. 30, 1969
BIDS--EVALUATION--TAX BENEFITS--NOT FOR CONSIDERATION
NEGOTIATION OF WATER AND SEWER SERVICES CONTRACT FOR VO-TECH INDIAN
SCHOOL BY BUREAU OF INDIAN AFFAIRS WITH CITY OF ALBUQUERQUE, N. MEX;
RATHER THAN WITH INVESTOR - OWNED TAX - PAYING PUBLIC UTILITY WHICH
OFFERED CHEAPER RATES, WAS PROPER AND PROTEST TO AWARD IS DENIED,
PARTICULARLY IN VIEW OF BUREAU'S PLAN TO EVENTUALLY TURN OVER OPERATION
OF SCHOOL TO CITY AND IN CONFORMANCE WITH CITY PLANNED SEWER FACILITIES
PROGRAM FOR AREA INVOLVED, PROMULGATED PURSUANT TO FEDERAL WATER
POLLUTION CONTROL ACT, 33 U.S.C. 466, AND IN COMPLIANCE WITH EXECUTIVE
ORDER 11288. TAX BENEFITS ACCRUING TO GOVT. IF AWARD MADE TO TAX -
PAYING UTILITY COMPANY ARE NOT FOR CONSIDERATION IN EVALUATION OF
NEGOTIATED PROCUREMENT.
TO MR. FREEMAN LUSK:
REFERENCE IS MADE TO YOUR LETTER OF AUGUST 21, 1969, PROTESTING THE
AWARD OF A CONTRACT BY THE BUREAU OF INDIAN AFFAIRS, DEPARTMENT OF THE
INTERIOR, TO THE CITY OF ALBUQUERQUE, NEW MEXICO, FOR WATER AND SEWAGE
SERVICES TO THE NEW VO-TECH INDIAN SCHOOL, OFFICIALLY CALLED THE
ALBUQUERQUE VOCATIONAL-TECHNICAL SCHOOL.
YOU STATE THAT AWARD OF THE CONTRACT TO THE CITY IS ADVERSE TO THE
BEST INTERESTS OF THE UNITED STATES ECONOMICALLY AND IN PRINCIPLE. YOU
STATE THAT YOUR COMPANY NOT ONLY OFFERS THE SERVICES AT LOWER COST TO
THE GOVERNMENT, BUT THAT IT IS AN INVESTOR-OWNED PUBLIC UTILITY PAYING
TAXES TO THE GOVERNMENT WHEREAS THE CITY DOES NOT PAY TAXES.
THE BUREAU OF INDIAN AFFAIRS HAS ACKNOWLEDGED THAT THE PARADISE
SERVICES CORPORATION HAS OFFERED THE CHEAPER RATES. HOWEVER, SINCE THE
BUREAU PLANS TO TURN THE OPERATION OF THE SCHOOL OVER TO THE CITY OF
ALBUQUERQUE EVENTUALLY AND SINCE THE FURNISHING OF SUCH SERVICES BY THE
CITY WILL COMPORT WITH THE SEWER FACILITIES PROGRAM PLANNED BY THE CITY
FOR THE AREA INVOLVED, IT PROPOSES TO NEGOTIATE THE CONTRACT FOR THE
WATER AND SEWAGE SERVICES WITH THE CITY. IN THAT REGARD, THE BUREAU
POINTS OUT THAT SECTION 4 (I) OF EXECUTIVE ORDER NO. 11288,"PREVENTION,
CONTROL AND ABATEMENT OF WATER POLLUTION BY FEDERAL ACTIVITIES,"
PROMULGATED PURSUANT TO THE FEDERAL WATER POLLUTION CONTROL ACT, AS
AMENDED, 33 U.S.C. 466, PROVIDES:
"ANY WASTE TREATMENT FACILITIES INSTALLED BY ANY DEPARTMENT, AGENCY,
OR ESTABLISHEMENT SHALL AS FAR AS PRACTICABLE BE CONSTRUCTED SO AS TO
CONFORM WITH ANY AREAWIDE PROGRAM, MEETING CRITERIA ESTABLISHED BY THE
SECRETARY OF HOUSING AND URBAN DEVELOPMENT FOR A UNIFIED OR OFFICIALLY
COORDINATED AREAWIDE SEWER FACILITIES SYSTEM AS PART OF THE
COMPREHENSIVELY PLANNED DEVELOPMENT OF THE AREA PURSUANT TO SECTION 702
(C) OF THE HOUSING AND URBAN DEVELOPMENT ACT OF 1965, THAT MAY HAVE BEEN
ADOPTED WITH RESPECT TO THE AREA CONCERNED.' IN THAT CONNECTION, THE
FEDERAL WATER POLLUTION CONTROL ADMINISTRATION, DEPARTMENT OF THE
INTERIOR, HAS ADVISED THE BUREAU OF INDIAN AFFAIRS, WITH RESPECT TO THE
ALBUQUERQUE VOCATIONAL-TECHNICAL SCHOOL, AS FOLLOWS: "THE MIDDLE RIO
GRANDE COUNCIL OF GOVERNMENTS HAS DEVELOPED AN AREAWIDE PLAN FOR SEWAGE
DISPOSAL AND THE PLAN HAS BEEN APPROVED BY THE DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT.'COMPLIANCE WITH EXECUTIVE ORDER 11288 SECTION 4 (I)
WOULD BE ACCOMPLISHED BY THE SCHOOLS CONNECTING TO THE SEWAGE SYSTEM
PROVIDED BY THE CITY OF ALBUQUERQUE.'
IN VIEW OF THE POLICY EXPRESSED IN THE EXECUTIVE ORDER, THE
DETERMINATION TO NEGOTIATE THE CONTRACT WITH THE CITY OF ALBUQUERQUE
DOES NOT APPEAR TO BE IMPROPER. IN THAT CONNECTION, IN B-161990, AUGUST
29, 1967, OUR OFFICE STATED:
"IN NEGOTIATED PROCUREMENTS, THE RULES OF FORMALLY ADVERTISED
COMPETITIVE BIDDING, SUCH AS THE REQUIREMENT FOR AWARD TO THE LOWEST
RESPONSIVE BIDDER, ARE NOT APPLICABLE AND THE NEGOTIATION AUTHORITY MAY
LEGALLY TAKE INTO CONSIDERATION ALL FACTORS DEEMED ESSENTIAL TO THE
ACCOMPLISHMENT OF A PROCUREMENT. 40 COMP. GEN. 508.'
WITH REFERENCE TO YOUR STATEMENT REGARDING THE TAXPAYING STATUS OF
YOUR ORGANIZATION, WE HELD IN 43 COMP. GEN. 60 (1963) THAT TAX BENEFITS
WHICH WOULD ACCRUE TO THE GOVERNMENT IF AN AWARD WERE MADE TO AN
INVESTOR-OWNED PRIVATE UTILITY COMPANY RATHER THAN TO A TAX-EXEMPT
UTILITY SHOULD NOT BE CONSIDERED IN EVALUATING PROPOSALS FOR AWARD OF
GOVERNMENT CONTRACTS.
IN VIEW OF THE FOREGOING, YOUR PROTEST AGAINST THE PROPOSED AWARD OF
A CONTRACT TO THE CITY OF ALBUQUERQUE IS DENIED.
B-167856, OCT. 30, 1969
TO MR. WILLIAM G. MANIOTIS:
THIS IS IN REFERENCE TO YOUR LETTER DATED SEPTEMBER 29, 1969,
REQUESTING FURTHER CONSIDERATION OF THE ACTION TAKEN ON YOUR CLAIM ON
BEHALF OF YOUR SON, WILLIAM P. MANIOTIS, FOR PAY AND ALLOWANCES
BELIEVED TO BE DUE HIM AS FIREMAN, UNITED STATES NAVAL RESERVE,
SUBSEQUENT TO THE EXPIRATION, ON MARCH 4, 1967, OF HIS PERIOD OF ORDERED
TRAINING DUTY, WHICH WAS THE SUBJECT OF OUR DECISION B-167856 OF
SEPTEMBER 24, 1969.
WE FULLY EXPLAINED TO YOU WHY, ON THE BASIS OF THE FACTS AND THE
DETERMINATION OF THE NAVY DEPARTMENT, THERE IS NO AUTHORITY FOR PAYMENT
OF THIS CLAIM SINCE UNDER APPLICABLE LAW A MEMBER OF THE NAVAL RESERVE
WHO IS CALLED TO ACTIVE DUTY FOR A PERIOD OF LESS THAN 30 DAYS AND IS
DISABLED IN LINE OF DUTY FROM DISEASE IS NOT ENTITLED TO PAY AND
ALLOWANCES BEYOND THE DATE AUTHORIZED BY HIS ORDERS. YOUR LETTER
CONTAINS NO EVIDENCE OR INFORMATION NOT PREVIOUSLY CONSIDERED AND
AFFORDS NO BASIS UPON WHICH FURTHER CONSIDERATION MAY BE GIVEN THE
CLAIM.
YOU AGAIN STATE THAT YOUR SON'S DISABILITY WAS DUE TO "INJURY" AND
INSIST THAT YOU CAN PRODUCE FACTS WHICH WILL PROVE YOUR POSITION IN THE
MATTER. THEREFORE, YOU HAVE EXPRESSED THE DESIRE TO HAVE A "HEARING IN
THE NEW YORK AREA AT SOME NAVAL STATION OR ACTIVITY" IN ORDER TO PRESENT
IN PERSON "EVIDENCE NEVER PREVIOUSLY ADMITTED NOR CONSIDERED" WHICH YOU
BELIEVE WILL ESTABLISH YOUR SON'S "INJURY.'
AS YOU WERE ADVISED IN OUR DECISION OF SEPTEMBER 24, 1969, MATTERS
REFERRED TO THIS OFFICE ARE CONSIDERED ON THE BASIS OF THE WRITTEN
RECORD AND WE HAVE NO FACILITIES FOR THE TAKING OF ORAL TESTIMONY.
ALSO, YOU WERE ADVISED THAT YOU MAY SUBMIT IN PERSON ANY INFORMATION YOU
WISH DURING BUSINESS HOURS AT OUR OFFICE IN WASHINGTON, D.C. HOWEVER,
WE CANNOT HONOR YOUR REQUEST FOR A PERSONAL INTERVIEW IN THE NEW YORK
AREA.
IF YOU KNOW OF ANY ACCIDENT OR OTHER INCIDENT WHICH RESULTED IN AN
ACTUAL PHYSICAL INJURY TO YOUR SON, WE WILL GIVE CONSIDERATION TO ANY
INFORMATION YOU MAY SUBMIT WITH RESPECT THERETO. IF YOU PREFER YOU MAY
SUBMIT ANY SUCH INFORMATION TO THE DEPARTMENT OF THE NAVY FOR
CONSIDERATION AND RECOMMENDATION TO THIS OFFICE. YOU ARE ADVISED,
HOWEVER, THAT AN EXPRESSION OF OPINION ON YOUR PART, TO BE PERSUASIVE,
SHOULD BE SUPPORTED BY MEDICAL EVIDENCE OR OPINION FURNISHED BY A DOCTOR
OR DOCTORS WHO TREATED YOUR SON FOR AN INJURY DURING THE PERIOD HERE
INVOLVED.
B-167891, OCT. 30, 1969
BIDS--QUALIFIED--LETTER CONTAINING CONDITIONS NOT IN INVITATION
LOW BID WHICH, UNDER PROCUREMENT FOR FURNISHING U.S. GOVERNMENT
NATIONAL CREDIT CARDS, INCLUDED COVER LETTER WHICH RESTRICTED BID TO
EMBOSSING, WHEN FIRST ITEM REQUIREMENTS PROVIDED FOR EMBOSSING AND
PRINTING, NOTWITHSTANDING BIDDER'S INTERPRETATION THAT SEPARATE
CONTRACTS WOULD BE LET FOR PRINTING AND EMBOSSING WORK UNDER ITEM NO. 1,
WAS PROPERLY REJECTED, SINCE PROCURING AGENCY, BASED ON REASONABLE
INTERPRETATION OF PROTESTANT'S COVER LETTER, CORRECTLY CONCLUDED BID
OFFERED TO FURNISH ONLY PART OF REQUIRED WORK MAKING BID NONRESPONSIVE.
BIDDER WHO SUBMITS LETTER DISCUSSING REQUIREMENTS TAKES RISK THAT LETTER
MAY BE FOUND TO QUALIFY BID WITH RESPECT TO CERTAIN MATERIAL
REQUIREMENTS.
TO LEMCO, INCORPORATED:
REFERENCE IS MADE TO THE LETTER OF SEPTEMBER 15, 1969, PROTESTING
AGAINST THE REJECTION OF YOUR BID UNDER INVITATION FOR BIDS NO.
FPNGG-M-27824-A-8-12-69, ISSUED ON JULY 22, 1969, BY THE FEDERAL SUPPLY
SERVICE, GENERAL SERVICES ADMINISTRATION (GSA), FOR FURNISHING UNITED
STATES GOVERNMENT NATIONAL CREDIT CARDS. THE CONTRACT PERIOD IS TO BE
FROM DECEMBER 1, 1969, TO NOVEMBER 30, 1970.
THE ITEM DESCRIPTION ON PAGE 8 OF THE SOLICITATION IS DIVIDED INTO
TWO PARTS. THE FIRST PART OF THE ITEM DESCRIPTION APPLIES TO BOTH THE
EMBOSSED AND UNEMBOSSED CARDS AND IT IS PROVIDED THAT CERTAIN PRINTED
MATERIAL IS TO BE PUT ON THE FACE OF BOTH THE EMBOSSED AND UNEMBOSSED
CARDS. CERTAIN OTHER MATERIAL WHICH IS TO BE PRINTED ON THE BACK OF
BOTH THE EMBOSSED AND UNEMBOSSED CARDS IS ALSO SET OUT IN THE FIRST PART
OF THE ITEM DESCRIPTION.
THE SECOND PART OF THE ITEM DESCRIPTION WHICH APPLIES ONLY TO THE
EMBOSSED CARDS STATES AS FOLLOWS:
"CARDS TO BE EMBOSSED IN ACCORDANCE WITH DATA FURNISHED BY THE
REQUISITIONING AGENCY; EMBOSSING TO CONSIST OF FIVE LINES, LINE 1 WILL
BE THE ACCOUNT NUMBER * * * THE ACCOUNT NUMBER WILL CONSIST OF TEN
DIGITS, THE FIRST THREE WILL BE 000 (WITH THE EXCEPTION OF THE SPECIAL
ACCOUNT NUMBERS AS SHOWN BELOW *), THE FOURTH WILL SIGNIFY THE VEHICLE
CLASS, THE FIFTH AND SIXTH WILL CONSTITUTE THE AGENCY CODE NUMBER, THE
SEVENTH, EIGHTH AND NINTH WILL INDICATE THE AGENCY BILLING ADDRESS; THE
TENTH DIGIT WILL BE A CHECK NUMBER FOR USE IN AUTOMATIC BILLING
OPERATIONS OF THE OIL COMPANIES AND WILL BE DETERMINED ON A MATHEMATICAL
BASIS BY THE HOLDER OF THE CONTRACT FOR EMBOSSING THE CARDS. * * *".
BIDS WERE OPENED ON AUGUST 12, 1969, AND A BID WAS RECEIVED FROM YOUR
CONCERN WHICH PURPORTEDLY QUOTED A PRICE ON ITEM NO. 1 AND THIS PRICE
WAS FOUND TO BE LOW. AMENDMENT NO. 1 WAS NOT RETURNED WITH THE BID BUT
IT WAS FOUND THAT THIS WOULD HAVE ONLY AN INCONSEQUENTIAL EFFECT ON YOUR
BID. A COVER LETTER DATED AUGUST 8, 1969, ATTACHED TO LEMCO'S BID
REFERENCING THE INSTANT INVITATION STATED AS FOLLOWS:
"RE: SOLICITATION NO. FPNGG-M-27824-A-8-12-69 "THIS BID IS SUBMITTED
WITH THE PROVISION THAT THE TYPE STYLE SUBMITTED (SAMPLES ENCLOSED) WILL
BE ACCEPTABLE TO THE UNITED STATES VERNMENT.'THIS MAKES NO REFERENCE TO
THE ACTUALLY PRINTED CARDS BECAUSE WE ARE NOT BIDDING ON THAT PART OF
THE CONTRACT. THE EMBOSSED SAMPLES ARE SUBMITTED MERELY TO SHOW THE
TYPE STYLE WE CAN PRODUCE FOR THE EMBOSSING PART OF THE CONTRACT AND IS
NOT A SAMPLE FOR EITHER SPACING OR EMBOSSING PRESSURE.'
GSA DETERMINED THAT YOUR BID WAS NONRESPONSIVE SINCE IT COVERED ONLY
THE EMBOSSING OF THE CARD, WHEREAS THE SPECIFICATION REQUIREMENT FOR
ITEM NO. 1 WAS FOR PRINTED CARDS, TO BE EMBOSSED IN ACCORDANCE WITH DATA
FURNISHED BY THE REQUISITIONING AGENCIES. BY LETTER OF SEPTEMBER 3,
1969, GSA ADVISED YOU OF ITS DETERMINATION. GSA MADE AWARDS UNDER THE
SOLICITATION ON AUGUST 28, 1969, PRIOR TO RECEIPT OF NOTICE OF YOUR
PROTEST.
THE ARGUMENT IN THE LETTER OF SEPTEMBER 15 FROM YOUR CONCERN IS THAT
THE INVITATION PROVIDES FOR AWARD ON AN ITEM-BY-ITEM BASIS AND THAT "* *
* UNDER -EMBOSSING- ONE PORTION OF A SENTENCE READS -WILL BE DETERMINED
ON A MATHEMATICAL BASIS BY THE HOLDER OF THE CONTRACT FOR EMBOSSING THE
CARDS.-
THIS LEADS ONE TO BELIEVE THAT THERE CERTAINLY CAN BE MORE THAN ONE
PARTY INVOLVED IN THIS CONTRACT.' THE LETTER OF SEPTEMBER 15 CONCLUDES
AS FOLLOWS:
"WE CAN FIND NO WHERE IN THIS CONTRACT THAT STATES VAGUELY OR CLEARLY
THAT YOU HAVE TO BID ON BOTH PORTIONS OF THE CONTRACT. IF THIS HAD BEEN
THE CASE THIS SHOULD HAVE CERTAINLY BEEN SPELLED OUT VERY CLEARLY.
"IF THIS CONTRACT WAS AWARDED TO THE LOW BIDDER FOR EMBOSSED CARDS
AND THE LOW BIDDER FOR UNEMBOSSED CARDS THE SAVINGS TO THE GOVERNMENT
WOULD BE VERY GREAT, OVER 100 PERCENT ON THE UNEMBOSSED CARDS.
THEREFORE, WE FEEL THIS CONTRACT SHOULD BE AWARDED TO THESE TWO PARTIES
OR RELET THE CONTRACT WITH THE REQUIREMENTS SPELLED OUT MORE CLEARLY.'
THE LETTER OF SEPTEMBER 15 ASSUMES THAT YOUR BID WAS REJECTED ON THE
BASIS THAT YOUR CONCERN DID NOT BID ON BOTH ITEMS 1 AND 2. HOWEVER,
THIS WAS NOT THE CASE. THE FIRST PART OF THE ITEM DESCRIPTION PROVIDED
THAT THE CARDS DESCRIBED UNDER ITEM NO. 1 SHOULD HAVE CERTAIN PRINTING
ON THE FACE OF THE CARD AS WELL AS ON THE BACK OF THE CARD IN ADDITION
TO THE EMBOSSING WORK WHICH WAS TO BE IN ACCORDANCE WITH DATA FURNISHED
BY THE REQUISITIONING AGENCY. GSA INTERPRETED THE COVER LETTER, QUOTED
ABOVE, SUBMITTED WITH YOUR BID, AS LIMITING YOUR OFFER FOR ITEM NO. 1 TO
THE EMBOSSING WORK ONLY. IT WAS GSA'S FINDING THAT YOUR BID DEVIATED
FROM THE REQUIREMENTS FOR ITEM NO. 1 WHICH CALLED FOR BOTH PRINTING WORK
AND EMBOSSING WORK.
THE ITEM-BY-ITEM AWARD PROVISION IN PARAGRAPH 4 OF THE SPECIAL
PROVISIONS RELATES TO THE POSSIBILITY OF HAVING ONE CONTRACTOR FOR ITEM
NO. 1 AND ANOTHER CONTRACTOR FOR ITEM NO. 2. THERE IS NOTHING IN
PARAGRAPH 4 WHICH WOULD INDICATE THAT IT WAS INTENDED TO HAVE DIFFERENT
CONTRACTORS FOR THE PRINTING AND EMBOSSING REQUIREMENTS OF ITEM NO. 1.
THE SENTENCE IN THE EMBOSSING SECTION OF THE ITEM DESCRIPTION REFERRED
TO IN THE LETTER OF SEPTEMBER 15 CLEARLY APPLIES TO HOW THE CONTRACTOR
WILL DETERMINE WHICH DIGIT WILL BE THE TENTH DIGIT OF THE ACCOUNT
NUMBER. THERE IS NO BASIS FOR THE INTERPRETATION APPARENTLY URGED BY
YOU THAT "WILL BE DETERMINED ON A MATHEMATICAL BASIS BY THE HOLDER OF
THE CONTRACT FOR EMBOSSING THE CARDS" MEANS THAT SEPARATE CONTRACTS WILL
BE LET FOR THE PRINTING AND EMBOSSING WORK UNDER ITEM NO. 1.
WHENEVER A BIDDER SUBMITS A LETTER WITH HIS BID WHICH DISCUSSES THE
REQUIREMENTS OF THE SPECIFICATIONS HE IS TAKING THE RISK THAT IT MAY BE
FOUND THE LETTER QUALIFIED THE BID WITH RESPECT TO CERTAIN MATERIAL
REQUIREMENTS. HOWEVER, THE INTERPRETATION OF THE LETTER SUBMITTED WITH
THE BID MUST BE A REASONABLE ONE. SEE B-159691, MARCH 6, 1967. IN THE
INSTANT CASE IT WAS FOUND THAT THE COVER LETTER QUALIFIED YOUR BID FOR
ITEM NO. 1 SINCE THERE APPEARS TO BE NO QUESTION THAT THE COVER LETTER
MEANT YOUR CONCERN WAS OFFERING TO FURNISH ONLY PART OF THE REQUIREMENTS
FOR THE ITEM. THE PRINTING REQUIREMENT OF ITEM NO. 1 AND THE EMBOSSING
REQUIREMENT OF ITEM NO. 1 OBVIOUSLY ARE BOTH MATERIAL AND AS PREVIOUSLY
INDICATED THERE IS NOTHING WHICH WOULD PERMIT A SPLIT AWARD FOR THESE
REQUIREMENTS.
THE SENTENCE IN THE COVER LETTER WITH YOUR BID WHICH STATES "THIS
MAKES NO REFERENCE TO THE ACTUALLY PRINTED CARDS BECAUSE WE ARE NOT
BIDDING ON THAT PART OF THE CONTRACT" MUST BE CONSTRUED TO MEAN THAT YOU
WERE BIDDING ON ONLY THE EMBOSSING REQUIREMENT OF ITEM NO. 1. PURSUANT
TO OUR REVIEW WE FIND NO BASIS TO QUESTION GSA'S DETERMINATION THAT YOUR
BID FOR ITEM NO. 1 WAS NONRESPONSIVE.
IN CONSIDERING YOUR CONTENTION THAT THERE WOULD HAVE BEEN A
100-PERCENT SAVING IF THE AWARD HAD BEEN MADE TO THE LOW BIDDER FOR THE
EMBOSSED CARDS AND THE LOW BIDDER FOR THE UNEMBOSSED CARDS, WE WILL
COMPARE HOW MUCH ITEM NO. 1 WOULD COST IF THE PRINTING AND EMBOSSING
PORTIONS WERE APPORTIONED BETWEEN DIFFERENT CONTRACTORS WITH THE COST OF
ITEM NO. 1 WITH ONE CONTRACTOR DOING BOTH PORTIONS OF THE JOB. THE BID
FROM PRINTLOID, INCORPORATED, AT $0.132 FOR BOTH THE PRINTING AND
EMBOSSING PORTIONS OF ITEM NO. 1 WAS FOUND TO BE THE LOW RESPONSIVE BID
FOR THIS ITEM AND AWARD FOR THIS ITEM WAS MADE TO THIS BIDDER. SINCE
THERE WAS NO BID FOR ONLY THE PRINTING PORTION OF ITEM NO. 1, ANY
COMPUTATION OF THE PRICE FOR THIS ITEM ON AN APPORTIONED BASIS FOR THE
PRINTING AND EMBOSSING WORK WOULD HAVE TO BE A THEORETICAL ONE. IN
COMPUTING HOW MUCH THE PRINTING PORTION OF ITEM NO. 1 WOULD COST, WE
WILL USE THE PRICES SUBMITTED FOR ITEM NO. 2 WHICH WAS FOR UNEMBOSSED
WORK AND WE WILL GIVE YOU THE BENEFIT OF THE LOW BID FROM MARAN PLASTIC
COMPANY EVEN THOUGH THIS BID WHICH QUOTED A ,PER M" PRICE RATHER THAN AN
"EACH" PRICE WAS FOUND TO BE NONRESPONSIVE. FOR THE EMBOSSED PORTION OF
THE WORK UNDER ITEM NO. 1, WE WILL USE THE PRICE IN YOUR BID. THIS
COMPUTATION IS AS FOLLOWS:
MARAN PLASTIC'S BID FOR UNEMBOSSED
CARDS. $0.02575 EACH
LEMCO'S PRICE FOR ITEM NO. 1, LESS
DISCOUNT OF ONE PERCENT. $0.1283 EACH
------------
TOTAL $0.15405 EACH THE ABOVE COMPUTATION
INDICATES THAT IF THE AWARD FOR ITEM NO. 1 WERE MADE ON AN APPORTIONED
BASIS FOR THE PRINTING AND EMBOSSING WORK, THE GOVERNMENT WOULD ACTUALLY
HAVE TO PAY MORE THAN IT WILL UNDER THE CONTRACT AWARDED TO PRINTLOID
FOR ITEM NO. 1 AT $0.132. IN THE CIRCUMSTANCES WE FIND NO BASIS TO YOUR
CONTENTION THAT AN AWARD TO THE LOW BIDDER FOR THE EMBOSSED PORTION AND
THE LOW BIDDER FOR THE UNEMBOSSED PORTION WOULD HAVE RESULTED IN A
100-PERCENT SAVING TO THE GOVERNMENT.
B-167976, OCT. 30, 1969
OFFICERS AND EMPLOYEES--TRANSFERS--RELOCATION EXPENSES--TEMPORARY
QUARTERS--NONENTITLEMENT
EMPLOYEE'S CLAIM FOR TEMPORARY QUARTERS ALLOWANCE INCIDENT TO STATION
TRANSFER FOR HIMSELF AND FAMILY FROM JUNE 29, 1969 (DATE HE AND WIFE
FIRST OCCUPIED TEMPORARY QUARTERS) THROUGH JULY 28, 1969 -- WHERE
EMPLOYEE DEPARTED PHOENIX WITH FAMILY JUNE 25, 1969 AND PLACED CHILDREN
IN CAMP FOR PERIOD JUNE 26 TO JULY 29, 1969 -- IS DISALLOWED FOR
CHILDREN, SINCE RECORD FAILS TO SHOW THEY WERE SENT TO CAMP INCIDENT TO
STATION CHANGE, AND CAMP RECEIPTS DO NOT SHOW WHAT PORTION OF COST
COVERED SUBSISTENCE EXPENSES AS REQUIRED BY BUREAU OF THE BUDGET CIR.
NO. A-56, SUBSEC. 2.5D (1); PART OF CLAIM COVERING TEMPORARY QUARTERS
FOR EMPLOYEE AND WIFE FOR JULY 26-28, 1969 IS ALSO DENIED, ABSENT
REQUIRED EVIDENCE SHOWING THEY OCCUPIED TEMPORARY QUARTERS FOR SUCH
PERIOD.
TO MR. JOHN C. MACKALL:
YOUR LETTER OF SEPTEMBER 24, 1969, ENCLOSING SEVERAL COPIES OF
VOUCHERS IN FAVOR OF MR. HAROLD T. SCHNURER, REPRESENTING A CLAIM FOR
TEMPORARY QUARTERS ALLOWANCE FOR HIMSELF, WIFE, AND TWO CHILDREN IN
CONNECTION WITH A TRANSFER OF HIS OFFICIAL STATION AS AN EMPLOYEE OF THE
SMALL BUSINESS ADMINISTRATION, REQUESTS A DECISION FROM OUR OFFICE
CONCERNING PAYMENT OF THAT PART OF THE VOUCHER FOR TEMPORARY QUARTERS
ALLOWANCE FOR THE CHILDREN.
THE RECORD SHOWS THAT INCIDENT TO A CHANGE OF OFFICIAL STATION FROM
PHOENIX, ARIZONA, TO SAN FRANCISCO, CALIFORNIA, MR. SCHNURER WITH HIS
WIFE AND TWO CHILDREN DEPARTED PHOENIX ON JUNE 25, 1969. TRAVELING BY
AN INDIRECT ROUTE, THE EMPLOYEE PLACED HIS TWO CHILDREN IN CAMP AT
PRESCOTT, ARIZONA, FOR THE PERIOD JUNE 26 TO JULY 29, 1969.
THE EMPLOYEE IS CLAIMING TEMPORARY QUARTERS ALLOWANCE FOR HIMSELF AND
FAMILY FROM JUNE 29, 1969, THE DATE HE AND HIS WIFE FIRST OCCUPIED
TEMPORARY QUARTERS THROUGH JULY 28, 1969. IT IS NOTED THAT THE TRAVEL
ORDER AUTHORIZING THE CHANGE OF STATION WAS ISSUED JUNE 6, 1969. WHILE
THE FILE DOES NOT SHOW WHEN ARRANGEMENTS WERE FIRST MADE FOR PLACING THE
CHILDREN IN CAMP, THE RECORD INDICATES THAT PRIOR TO THE ISSUANCE OF THE
TRAVEL ORDER THE EMPLOYEE HAD MADE ARRANGEMENTS, ALONG WITH DEPOSITS, TO
PLACE HIS TWO CHILDREN IN SEPARATE CAMPS AT PRESCOTT.
SECTION 2.5 OF BUREAU OF THE BUDGET CIRCULAR NO. A-56 PROVIDES FOR
THE PAYMENT OF SUBSISTENCE EXPENSES OF THE EMPLOYEE AND HIS IMMEDIATE
FAMILY WHILE OCCUPYING TEMPORARY QUARTERS WHEN AN EMPLOYEE IS
TRANSFERRED TO A NEW OFFICIAL STATION. THERE IS NOTHING IN THE FILE TO
SHOW THAT THE CLAIMANT WOULD NOT HAVE PLACED THE CHILDREN IN THE CAMP
EVEN IF THE TRANSFER HAD NOT OCCURRED. THAT IS, THE RECORD DOES NOT
SHOW THAT THE CHILDREN WERE SENT TO CAMP AS THE RESULT OF OR INCIDENT TO
THE PERMANENT CHANGE OF STATION. FURTHERMORE, THE RECEIPTS FURNISHED
COVERING THE FEES PAID FOR THE PERIOD AT CAMP DO NOT COMPLY WITH
SUBSECTION 2.5D (1) OF THE CIRCULAR BY SHOWING WHAT PORTION OF THE
AMOUNT OF THE TOTAL CAMP COST WAS FOR ACTUAL SUBSISTENCE EXPENSES AS
DEFINED IN THAT SUBSECTION.
ON THE BASIS OF THE RECORD BEFORE US, THAT PART OF THE CLAIM FOR
TEMPORARY QUARTERS ALLOWANCE FOR THE CHILDREN MAY NOT BE CERTIFIED FOR
PAYMENT.
IT IS NOTED THAT THE EMPLOYEE HAS FURNISHED RECEIPTS SHOWING THAT HE
AND HIS WIFE OCCUPIED TEMPORARY QUARTERS FOR THE PERIOD JUNE 29 THROUGH
JULY 25, 1969. IN THE ABSENCE OF THE REQUIRED EVIDENCE TO SHOW THAT
EMPLOYEE AND HIS WIFE OCCUPIED TEMPORARY QUARTERS FOR THE PERIOD JULY 26
THROUGH JULY 28, 1969, THAT PART OF THE CLAIM SHOULD ALSO BE DISALLOWED.
B-167979, OCT. 30, 1969
TO MR. RUSTICO DACUDAG:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 7, 1969,
RECEIVED HERE SEPTEMBER 3, 1969, BY REFERENCE FROM THE FINANCE CENTER,
U.S. ARMY, INDIANAPOLIS, INDIANA, CONCERNING YOUR CLAIM FOR THE
"BENEFITS AUTHORIZED UNDER THE PROVISION OF ACT NO. 263, OF THE 88TH.
CONGRESS DATED JANUARY 9, 1963, AND WAS APPROVED SEPTEMBER 30, 1968.' IT
IS ASSUMED THAT YOU HAVE IN MIND YOUR CLAIM FOR MUSTERING-OUT PAY
BELIEVED TO BE DUE INCIDENT TO YOUR DISCHARGE FROM THE PHILIPPINE SCOUTS
ON APRIL 1, 1949.
YOUR CLAIM FOR MUSTERING-OUT PAY WAS FIRST RECEIVED IN THE GENERAL
ACCOUNTING OFFICE ON APRIL 18, 1966, AND BY LETTERS DATED APRIL 28,
1966, MAY 11, 1967, AND APRIL 11, 1968, OUR CLAIMS DIVISION ADVISED YOU
THAT WE ARE WITHOUT AUTHORITY TO CONSIDER SUCH CLAIM SINCE THE ACT OF
OCTOBER 9, 1940, CH. 788, 54 STAT. 1061, 31 U.S.C. 71A, 237, FOREVER
BARS ANY CLAIM AGAINST THE UNITED STATES WHICH IS NOT RECEIVED IN THIS
OFFICE WITHIN 10 FULL YEARS AFTER THE DATE SUCH CLAIM FIRST ACCRUED. YOU
WERE ALSO ADVISED THAT WE KNOW OF NO LAW REMOVING THE TIME LIMITATION
FOR THE FILING OF CLAIMS COGNIZABLE BY THE GENERAL ACCOUNTING OFFICE IN
CASES SUCH AS YOURS.
IT IS NOTED THAT YOU CITED SECTION 14 OF THE ARMED FORCES VOLUNTARY
RECRUITMENT ACT OF 1945, APPROVED OCTOBER 6, 1945, CH. 393, 59 STAT.
543, AND CERTAIN REGULATIONS (APPARENTLY PARAGRAPHS 313-322, TM 14-502,
AUGUST 1946), WHICH YOU BELIEVE ENTITLE YOU TO MUSTERING-OUT PAY IN THE
AMOUNT OF $3,600. SECTION 14 OF THE 1945 ACT DOES NOT PERTAIN TO THE
PAYMENT OF MUSTERING-OUT PAY. IT RELATES ONLY TO THE AUTHORIZATION FOR
ENLISTMENT OF A NUMBER OF MEN IN THE PHILIPPINE SCOUTS FOR DUTY IN THE
PHILIPPINE ISLANDS AND CERTAIN AREAS OUTSIDE THE PHILIPPINES ON AND
AFTER OCTOBER 6, 1945. WHILE THE 1945 ACT CONTAINED AUTHORITY FOR
ENLISTMENT FOR SERVICE IN THE PHILIPPINE SCOUTS, IT DID NOT REFER TO
MUSTERING-OUT PAY.
CONCERNING THE "ACT NO. 263, OF THE 88TH. CONGRESS DATED JANUARY 9,
1963, * * * APPROVED ON SEPTEMBER 30, 1968," YOU ARE ADVISED THAT WE
CANNOT IDENTIFY THE LAW TO WHICH YOU REFER. PUBLIC LAW 88-263 WAS
APPROVED JANUARY 31, 1964 (78 STAT. 7), NO PUBLIC LAWS ENACTED DURING
THE FIRST SESSION OF THE 88TH CONGRESS WERE APPROVED PRIOR TO MARCH 6,
1963, AND NEITHER OF THE THREE ACTS APPROVED ON SEPTEMBER 30, 1968,
DURING THE SECOND SESSION OF THE 90TH CONGRESS NOR PUBLIC LAW 88-263
REFERRED TO MUSTERING-OUT PAY.
ANY MUSTERING-OUT PAY TO WHICH YOU MAY HAVE BEEN ENTITLED, ACCRUED TO
YOU BY VIRTUE OF THE MUSTERING-OUT PAYMENT ACT OF 1944, CHAPTER 9, 58
STAT. 8, AS AMENDED, 38 U.S.C. 691, ET SEQ. (1946 ED.), SECTION 2 (A)
(1) OF WHICH PROVIDED FOR PAYMENT OF A MAXIMUM OF $300 TO PERSONS WHO
SERVED 60 DAYS OR MORE OUTSIDE THE CONTINENTAL LIMITS OF THE UNITED
STATES OR IN ALASKA. IN CONNECTION WITH THAT ACT, TITLE II OF THE ACT
OF MAY 27, 1946, CH. 271, 60 STAT. 223, PROVIDED THAT THE BENEFITS OF
THE MUSTERING-OUT PAYMENT ACT SHOULD BE DEEMED APPLICABLE TO PERSONS WHO
SERVED IN THE PHILIPPINE SCOUTS UNDER THE PROVISIONS OF SECTION 14 OF
THE ACT OF OCTOBER 6, 1945, AND THAT PAYMENTS MADE UNDER THE 1944 ACT
SHOULD BE PAID AT THE RATE OF ONE PHILIPPINE PESO FOR EACH DOLLAR
AUTHORIZED BY LAW. IN OTHER WORDS, UNDER THE PROVISIONS OF LAW CITED
ABOVE, THE MAXIMUM AMOUNT THAT COULD BE PAID TO A PHILIPPINE SCOUT AS
MUSTERING-OUT PAY UPON DISCHARGE WAS 300 PESOS.
CLAIMS FOR MUSTERING-OUT PAY AND ANY OTHER CLAIM FOR ADDITIONAL PAY
INCIDENT TO YOUR MILITARY SERVICE ARE SUBJECT TO THE TIME LIMITATION
IMPOSED BY THE ACT OF OCTOBER 9, 1940, WHICH BARS EVERY CLAIM NOT
RECEIVED IN THE GENERAL ACCOUNTING OFFICE WITHIN 10 FULL YEARS FROM THE
DATE SUCH CLAIM FIRST ACCRUED. SINCE YOU STATE YOU WERE DISCHARGED ON
APRIL 1, 1949, IT WAS NECESSARY THAT ANY CLAIM ARISING OUT OF YOUR
MILITARY SERVICE BE RECEIVED IN THIS OFFICE ON OR BEFORE APRIL 1, 1959,
IN ORDER TO BE CONSIDERED BY US. YOUR CLAIM WAS NOT RECEIVED HERE UNTIL
APRIL 18, 1966, MORE THAN 17 YEARS AFTER THE DATE OF YOUR DISCHARGE.
THE PRIMARY PURPOSE OF THE ACT OF OCTOBER 9, 1940, IS TO RELIEVE THE
GOVERNMENT OF THE NECESSITY OF RETAINING AND GOING BACK OVER OLD RECORDS
FOR THE PURPOSE OF SETTLING STALE CLAIMS. NO MATTER HOW MERITORIOUS A
CLAIM MAY BE THIS OFFICE MAY MAKE NO EXCEPTION TO THE STATUTE NOR MAY
ANY EXTENSION OF TIME BE GRANTED WITHIN WHICH CLAIMS MAY BE FILED IN
THIS OFFICE. SINCE YOUR CLAIM FOR AN ADDITIONAL AMOUNT IN CONNECTION
WITH YOUR MILITARY SERVICE ACCRUED NO LATER THAN THE DATE OF YOUR
DISCHARGE AND SINCE SUCH CLAIM WAS NOT RECEIVED UNTIL AFTER 10 YEARS
FOLLOWING THAT DATE, CONSIDERATION THEREOF IS NOT AUTHORIZED.
B-168016, OCT. 30, 1969
MISTAKES--ALLEGATION AFTER AWARD--CONTRACTING OFFICER'S ERROR DETECTION
DUTY--NOTICE OF ERROR
CONTRACTOR, WHO ALLEGED ERROR IN BID AFTER AWARD, CONFIRMED BY
WORKSHEET SUBMITTED, HAVING TRANSPOSED UNIT PRICES PER CASE ON CHICKEN
AND BEEF BOUILLON WHICH RESULTED IN UNIT PRICES FOR BEEF BOUILLON BEING
LOWER THAN THOSE FOR CHICKEN WHEREAS EVIDENCE SUBMITTED BY CONTRACTING
OFFICER CLEARLY SHOWED COST OF BEEF BOUILLON IN PREVIOUS SOLICITATIONS
WERE HIGHER AS WERE ALL OTHER BIDS SUBMITTED, MAY HAVE CONTRACT CANCELED
WITHOUT LIABILITY SINCE MISTAKE WAS SO APPARENT CONTRACTING OFFICER
SHOULD HAVE BEEN ON NOTICE OF POSSIBLE ERROR AND REQUESTED VERIFICATION
OF PRICE QUOTED BEFORE AWARD.
TO MR. JOHNSON:
REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 29, 1969, WITH
ENCLOSURES, FILE REFERENCE NO. 134G, FROM THE DIRECTOR, SUPPLY SERVICE,
DEPARTMENT OF MEDICINE AND SURGERY, REQUESTING A DECISION AS TO THE
ACTION TO BE TAKEN CONCERNING A MISTAKE IN BID ALLEGED BY THE FINER
FOODS SALES COMPANY, INC., AFTER AWARD OF A CONTRACT. THE CONTRACTING
OFFICER HAS RECOMMENDED THAT THE AWARD ON ITEM 13 BE CANCELED WITHOUT
LIABILITY TO THE CONTRACTOR.
INVITATION FOR BIDS (IFB) NO. M4-193-69, WAS ISSUED ON MARCH 24,
1969, BY THE VETERANS ADMINISTRATION, MARKETING DIVISION, SUBSISTENCE,
FOR VARIOUS TYPES OF BOUILLONS, SCHEDULED FOR DELIVERY TO THREE VA
SUPPLY DEPOTS. EIGHT FIRMS RESPONDED TO THE INVITATION WHICH WAS OPENED
ON APRIL 9, 1969. FINER FOODS SALES WAS AWARDED THE CONTRACT FOR 132
CASES OF ITEM 7, VEGETABLE PROTEIN BOUILLON AT $5.40 PER CASE; AND 776
CASES OF ITEM 13, BEEF EXTRACT BOUILLON AT $6.20 PER CASE. THE
BOUILLON, WHICH WAS REQUIRED TO COMPLY WITH FEDERAL SPECIFICATIONS
EE-B-575A, WAS TO BE FURNISHED IN CASES OF TWELVE 1-POUND CANS OR JARS.
BIDS ON ITEM 13 WERE IN THE AMOUNTS OF $6.20, $6.90, $6.95, $7.44,
$8.33, $9.21 AND $10.
THE CONTRACTING OFFICER SENT FINER FOODS SALES A TELEGRAM DATED APRIL
18, 1969, WHICH READS AS FOLLOWS: "RE/M4-193-69 YOUR FIRM AWARDED ITEMS
7 AND 13 THIS OFFICIAL NOTICE TO PROCEED IN ACCORDANCE WITH TERMS AND
CONDITIONS OF SOLICITATION ON ITEMS AWARDED PO 69-MC-40811 WILL FOLLOW
(134M"
IN A TELEPHONE CONVERSATION ON APRIL 23 AND IN A LETTER OF APRIL 24,
1969, WHICH INCLUDED A WORKSHEET DATED APRIL 5, THE PRESIDENT OF FINER
FOODS SALES ALLEGED A MISTAKE IN BID ON ITEM 13. THE LETTER OF APRIL
24, 1969, STATED IN PERTINENT PART AS FOLLOWS:
"THIS ERROR OCCURRED IN TRANSPOSING THE UNIT PRICE PER CASE FROM THE
WORKSHEET TO THE ORIGINAL BID. BELOW IS GIVEN CORRECTED DATA:
"BOUILLON, CHICKEN FLAVORED PRICE QUOTED CORRECT PRICE
---------------------------- ------------ -------------
9. BELL, CALIF. 8.00 6.90
10. HINES, ILL. 7.15 6.20
11. SOMERVILLE, N.J. 7.30 6.20
"BOUILLON, BEEF EXTRACT PRICE QUOTED CORRECT PRICE
------------------------ ------------ -------------
12. BELL, CALIF. 6.90 8.00
13. HINES, ILL. 6.20 7.15
14. SOMERVILLE, N.J. 6.20 7.30 "ATT
OF THE ORIGINAL WORKSHEET SHOWING THE CORRECT UNIT PRICE PER CASE FOR
THE INDIVIDUAL ITEMS WE BID UPON. * * *"
IN CASES WHERE A MISTAKE HAS BEEN ALLEGED AFTER AWARD OF THE
CONTRACT, OUR OFFICE WILL GRANT RELIEF ONLY IF THE MISTAKE WAS MUTUAL OR
THE CONTRACTING OFFICER WAS ON ACTUAL OR CONSTRUCTIVE NOTICE OF THE
ERROR PRIOR TO AWARD. SEE B-166606, MAY 15, 1969; B-163970, MAY 7,
1968; AND THE CASES CITED THEREIN. IN A MEMORANDUM OF AUGUST 25, 1969,
THE CONTRACTING OFFICER FURNISHED EVIDENCE SHOWING THAT BOUILLON IS
PURCHASED ABOUT FIVE TIMES ANNUALLY AND THAT CHICKEN BOUILLON HAS ALWAYS
COST LESS THAN BEEF BOUILLON. FURTHERMORE, IT APPEARS THE PRICES PAID
FOR THE THREE MOST RECENT AWARDS PRIOR TO THE PRESENT SOLICITATION FOR
EACH TYPE OF BOUILLONS ARE AS FOLLOWS:
CHICKEN BEEF MONTH AND YEAR DESTINATION
BOUILLON BOUILLON OF AWARD ----------- -
-------------- BELL, CALIF. 7.15 8.449
6.25 7.789 OCT. -68 SOMERVILLE, N.J. 6.2
OCT. -68 BELL, CALIF. 7.00 8.00 DEC
6.10 7.50 DEC. -68 SOMERVILLE, N.J. 6.0
DEC. -68 HINES, ILL. 6.03 7.15 FEB
6.07 7.30 FEB. -69
IT IS OBVIOUS FROM THE ABOVE COMPARISON OF COSTS THAT BEEF BOUILLON
IS MORE COSTLY THAN CHICKEN BOUILLON. IN THE PRESENT INVITATION, ALL
FIRMS BIDDING ON BOTH PRODUCTS, WITH ONE EXCEPTION (EXCLUDING FINER
FOODS SALES), ALSO BID HIGHER ON BEEF BOUILLON THAN FOR CHICKEN
BOUILLON. THE EXCEPTION WAS A FIRM WHOSE BID OF $10 FOR EACH ITEM BID
UPON WAS CONSIDERED TO BE EXCESSIVE.
IN VIEW OF THE ABOVE CIRCUMSTANCES, WE BELIEVE THAT THE MISTAKE MADE
BY FINER FOODS SALES ON ITEM 13 WAS SO APPARENT THAT THE CONTRACTING
OFFICER WAS, OR SHOULD HAVE BEEN ON NOTICE OF THE POSSIBLE ERROR, AND
SHOULD HAVE REQUESTED VERIFICATION OF THE PRICE QUOTED PRIOR TO AWARD.
IT IS REPORTED THAT DELIVERY OF ITEM 13 HAS NOT BEEN MADE. THEREFORE,
WE AGREE WITH THE ADMINISTRATIVE RECOMMENDATION THAT THE AWARD OF ITEM
13 SHOULD BE CANCELED WITHOUT LIABILITY TO THE CONTRACTOR.
B-168051, OCT. 30, 1969
TO MR. ANTONIO P. AYING:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 8, 1969, IN EFFECT
APPEALING THE ACTION TAKEN BY THIS OFFICE ON YOUR CLAIM FOR
MUSTERING-OUT PAY BELIEVED TO BE DUE INCIDENT TO YOUR MILITARY SERVICE
WITH THE UNITED STATES FORCES FAR EAST DURING WORLD WAR II.
OUR RECORDS SHOW THAT ON SEPTEMBER 8, 1967, YOU PRESENTED A CLAIM TO
THE FINANCE CENTER, U.S. ARMY, INDIANAPOLIS, INDIANA, ON THE BASIS OF
YOUR MILITARY SERVICE DURING THE PERIOD DECEMBER 26, 1941, TO MAY 31,
1946. THE FINANCE CENTER FORWARDED YOUR CLAIM TO OUR CLAIMS DIVISION
WHERE IT WAS RECEIVED ON JANUARY 2, 1968.
SINCE ON JANUARY 2, 1968, A PERIOD OF MORE THAN 10 YEARS HAD ELAPSED
FROM THE DATE OF YOUR DISCHARGE, MAY 31, 1946 (THE DATE ON WHICH ANY
CLAIM YOU MAY HAVE HAD ACCRUED), OUR CLAIMS DIVISION RETURNED THE CLAIM
TO YOU ON JANUARY 12, 1968, WITH A COPY OF THE ACT OF OCTOBER 9, 1940,
AND ADVISED YOU THAT YOUR CLAIM WAS BARRED FROM CONSIDERATION.
THE ACT OF OCTOBER 9, 1940, AS CODIFIED IN 31 U.S.C. 71A, READS IN
PERTINENT PART AS FOLLOWS:
"/1) EVERY CLAIM OR DEMAND * * * AGAINST THE UNITED STATES COGNIZABLE
BY THE GENERAL ACCOUNTING OFFICE UNDER SECTIONS 71 AND 236 OF THIS TITLE
SHALL BE FOREVER BARRED UNLESS SUCH CLAIM * * * SHALL BE RECEIVED IN
SAID OFFICE WITHIN TEN FULL YEARS AFTER THE DATE SUCH CLAIM FIRST
ACCRUED: * * *.'
"/2) WHENEVER ANY CLAIM BARRED BY SUBSECTION (1) OF THIS SECTION
SHALL BE RECEIVED IN THE GENERAL ACCOUNTING OFFICE, IT SHALL BE RETURNED
TO THE CLAIMANT, WITH A COPY OF THIS SECTION, AND SUCH ACTION SHALL BE A
COMPLETE RESPONSE WITHOUT FURTHER COMMUNICATION.'
IN A LETTER DATED MARCH 5, 1968, YOU ADVISED THE CLAIMS DIVISION THAT
THE PROVISIONS OF THE ACT OF OCTOBER 9, 1940, WERE NOT KNOWN TO YOU IN
1946, AND THEREFORE, SHOULD NOT BE APPLIED. BY LETTER OF MARCH 27,
1968, OUR CLAIMS DIVISION EXPLAINED THE EFFECT OF THE ACT OF OCTOBER 9,
1940, AND AGAIN ADVISED YOU THAT CONSIDERATION OF YOUR CLAIM WAS BARRED
BY THAT ACT BECAUSE YOUR CLAIM WAS NOT FILED IN PROPER TIME. IN THAT
LETTER YOU WERE ADVISED THAT THE FACT THAT YOU WERE NOT ACQUAINTED WITH
THE ABOVE-CITED ACT CONSTITUTES NO LEGAL BASIS ON WHICH THIS OFFICE MAY
GIVE CONSIDERATION TO YOUR CLAIM, SINCE THE 1940 ACT MAKES NO EXCEPTION
WHICH WOULD PERMIT FAVORABLE ACTION ON CLAIMS OF INDIVIDUALS WHO
BELATEDLY LEARN OF THEIR RIGHTS. YOU WERE FURTHER ADVISED THAT THE
GENERAL ACCOUNTING OFFICE HAS BEEN GRANTED NO POWER OF DISPENSATION
UNDER THE ABOVE ACT AND, THEREFORE, NO EXCEPTIONS TO ITS PROVISIONS
COULD BE MADE.
IN YOUR PRESENT LETTER YOU PLACE RELIANCE ON "ACT NO. 263, 88TH
CONGRESS DATED JANUARY 9, 1963 AND APPROVED ON SEPTEMBER 30, 1965,"
CERTAIN ADMINISTRATIVE REGULATIONS PROMULGATED PURSUANT TO THE
MUSTERING-OUT PAYMENT ACT OF 1944, AND SECTION 14 OF PUBLIC LAW 190,
79TH CONGRESS, APPROVED OCTOBER 6, 1945, CH. 393, 59 STAT. 543. WHILE
WE ARE UNABLE TO IDENTIFY THE FIRST ACT, THIS DOES NOT APPEAR MATERIAL
FOR THE REASON SHOWN BELOW. SECTION 14 OF THE LATTER ACT DOES NOT
PERTAIN TO PAYMENT OF MUSTERING-OUT PAY. IT RELATES ONLY TO THE
AUTHORIZATION FOR THE ENLISTMENT OF A NUMBER OF PERSONS IN THE
PHILIPPINE SCOUTS FOR DUTY IN THE PHILIPPINE ISLANDS AND CERTAIN AREAS
OUTSIDE THE PHILIPPINES ON OR AFTER OCTOBER 6, 1945. THEREFORE, THAT
PROVISION OF LAW HAS NO BEARING ON YOUR CLAIM.
ANY MUSTERING-OUT PAY TO WHICH YOU MAY HAVE BEEN ENTITLED ACCRUED TO
YOU BY VIRTUE OF THE MUSTERING-OUT PAYMENT ACT OF 1944, CH. 9, 58 STAT.
8, AS AMENDED, 38 U.S.C. 691 ET SEQ. (1946 ED.).
CLAIMS UNDER THAT ACT ARE SUBJECT TO THE TIME LIMITATIONS OF THE ACT
OF OCTOBER 9, 1940, WHICH REQUIRES THAT SUCH CLAIMS BE RECEIVED IN THIS
OFFICE WITHIN 10 FULL YEARS FROM THE DATE THE CLAIM FIRST ACCRUES.
ANY CLAIM YOU HAD FOR MUSTERING-OUT PAY ACCRUED ON MAY 31, 1946, AND
COULD BE CONSIDERED ON ITS MERITS ONLY IF THIS OFFICE HAD RECEIVED IT
BEFORE MAY 31, 1956. SINCE IT WAS NOT RECEIVED HERE UNTIL JANUARY 2,
1968, OUR CLAIMS DIVISION HAD NO ALTERNATIVE UNDER THE LAW BUT TO ADVISE
YOU THAT CONSIDERATION THEREOF WAS BARRED. THE FACT THAT YOU MAY HAVE
BEEN UNAWARE OF THE 1940 ACT AFFORDS NO LEGAL BASIS FOR OUR
CONSIDERATION OF YOUR CLAIM.
ACCORDINGLY, SINCE CONSIDERATION OF YOUR CLAIM IS SPECIFICALLY
PROHIBITED BY THE 1940 BARRING ACT, THE ACTION HERETOFORE TAKEN BY OUR
CLAIMS DIVISION IS SUSTAINED.
B-166469, OCT. 29, 1969
OFFICERS AND EMPLOYEES--TRAINING--TRANSPORTATION AND/OR PER DIEM--RETURN
TO HEADQUARTERS ON NONWORKDAYS
WHERE EMPLOYEE PAID PER DIEM WHILE PURSUING TRAINING COURSE AT
SYRACUSE, N.Y. WAS LATER CHARGED ANNUAL LEAVE FOR PERIODS WHEN HE
RETURNED TO HEADQUARTERS DURING SCHOOL RECESSES, AND WAS REQUIRED TO
REFUND PER DIEM FOR SUCH PERIODS, CLAIM FOR TRAVEL COSTS BETWEEN
HEADQUARTERS AND TIMPORARY DUTY STATION AND PER DIEM EN ROUTE NOT
EXCEEDING PER DIEM IN LIEU OF SUBSISTENCE WHICH WOULD HAVE BEEN
ALLOWABLE HAD HE REMAINED AT TEMPORARY DUTY STATION IS ALLOWED BECAUSE,
WHILE NO REGULATION COVERS RETURN TO HEADQUARTERS DURING SCHOOL HOLIDAY
PERIODS WHEN GOVERNMENT EMPLOYEE IS ASSIGNED THERETO FOR TRAINING
INFORMATION FURNISHED SHOWS COST OF TRAVEL IN QUESTION EXCEEDED PER DIEM
WHICH EMPLOYEE WOULD HAVE BEEN ALLOWED HAD HE REMAINED AT TEMPORARY DUTY
STATION.
TO MR. REINALDO E. RIVERA:
THIS REFERS TO YOUR LETTER OF OCTOBER 3, 1969, WITH ENCLOSURES,
CONCERNING YOUR CLAIM FOR PER DIEM FOR THE PERIOD SEPTEMBER 8, 1966, TO
JULY 22, 1967, WHILE PURSUING A TRAINING COURSE AT SYRACUSE, NEW YORK.
THE RECORD SHOWS THAT YOU WERE PAID PER DIEM FOR THE PERIOD SEPTEMBER
8, 1966, THROUGH JULY 22, 1967. LATER IT WAS DETERMINED BY THE
DEPARTMENT OF THE NAVY THAT IT WAS PROPER TO CHARGE YOU ANNUAL LEAVE FOR
NOVEMBER 25, 1966, DECEMBER 21-23, 1966, DECEMBER 27-30, 1966, AND JUNE
5-9, 1967, WHEN YOU RETURNED TO YOUR HEADQUARTERS DURING SCHOOL RECESSES
AND YOU WERE REQUIRED TO REFUND THE PER DIEM FOR THE PERIOD OF ANNUAL
LEAVE OR $102.50.
WHILE THERE IS NO REGULATION COVERING THE RETURN TO HEADQUARTERS
DURING SCHOOL HOLIDAY PERIODS WHEN A GOVERNMENT EMPLOYEE IS ASSIGNED
THERETO FOR TRAINING IN A DUTY AND PAY STATUS, WE HAVE DETERMINED IN
YOUR PARTICULAR CASE TO ALLOW PAYMENT OF YOUR TRAVEL COSTS BETWEEN YOUR
HEADQUARTERS AND TEMPORARY DUTY STATION AND PER DIEM EN ROUTE IN AN
AMOUNT NOT TO EXCEED THE PER DIEM IN LIEU OF SUBSISTENCE WHICH WOULD
HAVE BEEN ALLOWABLE HAD YOU REMAINED AT THE TEMPORARY DUTY STATION
DURING THE HOLIDAY PERIODS.
SINCE YOU HAVE FURNISHED INFORMATION SHOWING THAT THE COST OF THE
TRAVEL IN QUESTION IN RETURNING TO YOUR HEADQUARTERS FOR THE THREE TRIPS
MADE DURING SCHOOL RECESSES EXCEEDED THE PER DIEM WHICH YOU WOULD HAVE
BEEN ALLOWED HAD YOU REMAINED AT YOUR TEMPORARY DUTY STATION WE ARE
ADVISING OUR CLAIMS DIVISION TO ISSUE A SETTLEMENT IN YOUR FAVOR FOR THE
AMOUNT YOU WERE REQUIRED TO REFUND TO THE NAVY DEPARTMENT AS PREVIOUSLY
INDICATED.
ALSO, WE NOTE IN YOUR LETTER OF OCTOBER 3, 1969, A COPY OF WHICH WAS
FORWARDED TO THE SECRETARY OF THE NAVY, YOU HAVE FURNISHED EVIDENCE TO
SHOW THAT YOU DID RETURN TO YOUR HEADQUARTERS DURING THE EASTER RECESS
OF 1967 AND THAT THE COMMANDING OFFICER OF THE NAVAL STATION IN PUERTO
RICO HAD KNOWLEDGE OF SUCH TRIP. AS WE STATED IN OUR DECISION OF
SEPTEMBER 25, 1969, B-166469, TO YOU, THE GRANTING OF ANNUAL LEAVE IS
WITHIN ADMINISTRATIVE DISCRETION. THEREFORE, WE ASSUME THE PROPER
OFFICIALS OF THE NAVY DEPARTMENT WILL DETERMINE THE AMOUNT OF ANNUAL
LEAVE TO BE CHARGED TO YOU FOR THIS PERIOD AND MAKE THE NECESSARY
ADJUSTMENT IN YOUR LEAVE RECORD.
B-167919, OCT. 29, 1969
OFFICERS AND EMPLOYEES--TRANSFERS--RELOCATION EXPENSES--TRANSPORTATION
FOR HOUSE HUNTING--AUTHORIZATION
CONCERNING RECLAIM FOR TRAVEL EXPENSES INCURRED INCIDENT TO ADVANCE
HOUSE-HUNTING TRIP -- TAKEN BY EMPLOYEE AND WIFE IN CONNECTION WITH HIS
TRANSFER OF STATION -- MADE PRIOR TO EXECUTION OF EMPLOYMENT AGREEMENT
REQUIRED BY SUBSEC. 1.3 BUREAU OF THE BUDGET CIR. NO. A-56 AND FORMAL
AUTHORIZATION OF TRAVEL, CLAIM MAY BE ALLOWED, AS TRIP WAS VERBALL
AUTHORIZED BY RESPONSIBLE OFFICER BEFORE IT WAS TAKEN; MANNER IN WHICH
IT WAS TAKEN WAS IN INTERESTS OF AGENCY; AND IT WAS THROUGH
ADMINISTRATIVE ERROR THAT EMPLOYMENT AGREEMENT WAS NOT SIGNED BEFORE
TRIP OCCURRED.
TO MR. VLADIMIR OLEYNIK:
THIS REFERS TO A LETTER OF SEPTEMBER 15, 1969, FROM MR. NEIL NEWMAN,
ACTING CHIEF, ACCOUNTING AND PAYROLL SERVICES, UNDER COVER OF WHICH WAS
SUBMITTED A RECLAIM VOUCHER ON BEHALF OF MR. JOHN J. SHEA. THE RECLAIM
VOUCHER IS FOR TRAVEL EXPENSES IN AN AMOUNT OF $205.60 INCURRED INCIDENT
TO AN ADVANCE HOUSE HUNTING TRIP TAKEN BY MR. SHEA AND HIS WIFE IN
CONNECTION WITH MR. SHEA'S TRANSFER FROM SAN FRANCISCO, CALIFORNIA, TO
LOS ANGELES, CALIFORNIA.
THE VOUCHER IS SUBMITTED TO THIS OFFICE FOR DECISION BECAUSE THE
ADVANCE HOUSE HUNTING TRIP WAS MADE PRIOR TO THE EXECUTION OF THE
EMPLOYMENT AGREEMENT REQUIRED BY SUBSECTION 1.3C OF BUREAU OF THE BUDGET
CIRCULAR NO. A-56, REVISED OCTOBER 12, 1966, AND FORMAL AUTHORIZATION OF
THE TRAVEL. DOUBT EXISTS AS TO WHETHER IT MAY BE PAID IN VIEW OF THE
PROVISIONS OF SECTION 2.4 OF BUREAU OF THE BUDGET CIRCULAR NO. A-56.
THE RECORD SHOWS THAT THE TRAVEL INVOLVED TOOK PLACE DURING THE
PERIOD MARCH 16, 1969, TO MARCH 21, 1969. ON MARCH 24, 1969, MR. SHEA
SIGNED THE EMPLOYMENT AGREEMENT REQUIRED AND ON MARCH 27, 1969, HIS
TRAVEL AUTHORIZATION WAS ISSUED, INCLUDING AUTHORIZATION OF "ROUND-TRIP
FOR EMPLOYEE AND WIFE, INCLUDING TEMPORARY SUBSISTENCE TO SEEK
RESIDENCE, NOT TO EXCEED 6 DAYS.' A LETTER FROM MR. SHEA IN SUPPORT OF
THE RECLAIM VOUCHER EXPLAINS THAT AS EARLY AS FEBRUARY 1 PRELIMINARY
ARRANGEMENTS HAD BEEN MADE AND HE AND ALL OFFICIALS OF THE AGENCY
CONCERNED FULLY UNDERSTOOD THAT HE WOULD BE TRANSFERRED FROM THE SAN
FRANCISCO AREA TO THE LOS ANGELES AREA EFFECTIVE AS OF THE BEGINNING OF
THE PAY PERIOD MARCH 31, 1969.
WE HAVE BEEN INFORMALLY ADVISED BY THE DEPARTMENT OF LABOR THAT THE
ADVANCE HOUSE HUNTING TRIP IN QUESTION WAS VERBALLY AUTHORIZED BY A
RESPONSIBLE OFFICER BEFORE IT WAS TAKEN AND THAT THE MANNER IN WHICH IT
WAS TAKEN WAS IN THE INTERESTS OF THE AGENCY; ALSO, THE RECORD CONTAINS
A STATEMENT FROM THE ASSISTANT DIRECTOR FOR DIVISION OF COMPLIANCE
OPERATIONS TO THE EFFECT THAT IT WAS THROUGH ADMINISTRATIVE ERROR THAT
MR. SHEA'S EMPLOYMENT AGREEMENT WAS NOT SIGNED BEFORE THE HOUSE HUNTING
TRIP OCCURRED. AS IS EXPLAINED IN HIS SUPPORTING LETTER MR. SHEA MADE
THE HOUSE HUNTING TRIP FOLLOWING THE CONCLUSION OF TEMPORARY DUTY AT
FRESNO, WHERE HE COMPLETED PENDING CASES BEFORE FINALLY TERMINATING HIS
DUTY AT SAN FRANCISCO, THUS MINIMIZING INTERRUPTION OF OPERATIONS OF THE
DEPARTMENT WHICH MIGHT HAVE OTHERWISE BEEN CAUSED BY HIS TRANSFER.
UNDER THE CIRCUMSTANCES SET FORTH ABOVE, WE DO NOT BELIEVE THE
REGULATIONS PRECLUDE REIMBURSEMENT OF THE EXPENSES OF A HOUSE HUNTING
TRIP TO MR. SHEA. THEREFORE, THE RECLAIM VOUCHER WHICH IS RETURNED
HEREWITH MAY BE CERTIFIED FOR PAYMENT IF OTHERWISE CORRECT.
B-168074, OCT. 29, 1969
OFFICERS AND EMPLOYEES--TRANSFERS--RELOCATION EXPENSES--SERVICES
PERFORMED BY EMPLOYEE
PERFORMANCE OF LEGAL SERVICES BY CIVILIAN EMPLOYEE, IN CAPACITY OF
PRIVATE ATTORNEY, INCIDENT TO SALE OF HIS RESIDENCE AT OLD OFFICIAL
STATION DOES NOT JUSTIFY REIMBURSEMENT FOR COMPARABLE LEGAL FEES, SINCE
UNDER SEC. 4.2C OF BUREAU OF THE BUDGET CIR. NO. A-56 PAYMENT OF FEES
FOR LEGAL SERVICES REQUIRES DOCUMENTATION SHOWING EXPENSES WERE IN FACT
INCURRED AND A BINDING OBLIGATION CANNOT BE CREATED BY EMPLOYEE
PERFORMING SERVICE FOR HIS OWN BENEFIT.
TO MR. FLOYD P. HOUGH:
WE REFER TO YOUR LETTER OF OCTOBER 7, 1969, REFERENCE F5023-NCR
(ABF), REQUESTING OUR ADVICE ON THE CLAIM OF MR. WALTER P. MULLEN FOR
LEGAL EXPENSES IN CONNECTION WITH THE SALE OF HIS RESIDENCE AT HIS OLD
OFFICIAL STATION.
MR. MULLEN WAS TRANSFERRED FROM THE CORPS OF ENGINEERS, CHICAGO,
ILLINOIS, TO THE NATIONAL PARK SERVICE, WITH DUTY STATION IN CHESTERTON,
INDIANA, EFFECTIVE NOVEMBER 17, 1968. HIS CLAIM UNDER BUREAU OF THE
BUDGET CIRCULAR NO. A-56, REVISED, DATED OCTOBER 12, 1966, FOR
REIMBURSEMENT OF EXPENSES INCURRED IN THE SALE OF HIS OLD RESIDENCE
INCLUDED $350 FOR LEGAL SERVICES WHICH HE PERFORMED HIMSELF. MR. MULLEN
SAYS THAT HE PERFORMED THESE SERVICES IN THE CAPACITY OF A PRIVATE
ATTORNEY AND SHOULD BE REIMBURSED FOR THEM AS IF THE WORK HAD BEEN DONE
BY A THIRD PARTY.
SECTION 4.2C OF CIRCULAR NO. A-56 ALLOWS THE PAYMENT OF CERTAIN LEGAL
FEES IF THEY ARE NOT INCLUDED IN THE BROKER'S FEE OR SIMILAR SERVICES
FOR WHICH REIMBURSEMENT IS CLAIMED UNDER OTHER CATEGORIES. LIMITATIONS
THE ALLOWANCES FOR REAL ESTATE EXPENSES ARE ENUMERATED IN SECTION 4.1,
WHICH REQUIRES IN SUBSECTION E THAT THE CLAIMED EXPENSES "WERE PAID BY
THE EMPLOYEE". FURTHER, SECTION 4.3A STATES THAT EACH ITEM "MUST BE
SUPPORTED BY DOCUMENTATION SHOWING THAT THE EXPENSE WAS IN FACT
INCURRED.' TO INCUR MEANS "TO BECOME SUBJECT TO OR LIABLE FOR" WHILE TO
PAY IS DEFINED AS ,TO GIVE WHAT IS DUE IN DISCHARGE OF A DEBT.' A DEBT
REQUIRES A LEGALLY ENFORCEABLE OBLIGATION AND THERE IS NONE HERE. MR.
MULLEN CANNOT CREATE A BINDING OBLIGATION MERELY BY PERFORMING SERVICES
FOR HIS OWN BENEFIT. THUS, IF MR. MULLEN DID NOT OWE A DEBT FOR THE
LEGAL FEES INVOLVED, HE COULD NOT HAVE INCURRED NOR PAID ANY EXPENSES AS
REQUIRED IN SECTION 4 OF BUREAU OF THE BUDGET CIRCULAR NO. A-56 AND,
THEREFORE, IS NOT ENTITLED TO ANY REIMBURSEMENT.
THIS IS IN AGREEMENT WITH PRIOR DECISIONS IN WHICH WE DISALLOWED
REIMBURSEMENT UNLESS THE EMPLOYEE COULD SHOW THAT HE HAD ACTUALLY
EXPENDED THE AMOUNT IN QUESTION. ONE CASE INVOLVED AN EMPLOYEE WHO SOLD
HIS OLD RESIDENCE PRIVATELY, BUT STILL CLAIMED THE STANDARD REALTOR'S
FEE AS A REIMBURSABLE EXPENSE. SINCE THE EMPLOYEE HAD NOT ACTUALLY PAID
OUT THE AMOUNT HE WAS SEEKING TO BE REIMBURSED FOR, WE DENIED HIS CLAIM.
IN A SITUATION ANALOGOUS TO THE INSTANT CASE, WHERE THE FORMER WIFE
OF THE EMPLOYEE WAS HIRED TO SELL HIS OLD RESIDENCE, IT WAS OUR OPINION
BASED ON THE FACTS PRESENTED THAT THE PAYMENT TO HER WAS A VOLUNTARY ACT
ON THE PART OF THE EMPLOYEE, AND NOT A DEBT THAT WAS LEGALLY ENFORCEABLE
AGAINST HIM. ACCORDINGLY, REIMBURSEMENT WAS NOT ALLOWED. B-165747,
JANUARY 7, 1969.
THE SIMILARITIES BETWEEN THE INSTANT CASE AND THOSE CITED WHEN ADDED
TO THE REGULATORY LANGUAGE HERE INVOLVED LEAD TO THE CONCLUSION THAT
THERE CANNOT BE ANY REIMBURSEMENT FOR THE LEGAL SERVICES RENDERED BY MR.
MULLEN. THEREFORE, YOU MAY NOT PROPERLY CERTIFY ANY SUCH PAYMENT TO MR.
MULLEN.
B-123384, OCT. 28, 1969
LEAVES OF ABSENCE--CIVILIANS ON MILITARY DUTY--PART-TIME OR INTERMITTENT
EMPLOYEES
HOURLY RATE REGULAR EMPLOYEES IN POSTAL FIELD SERVICE UNDER PERMANENT
CAREER APPOINTMENTS TO WORK MAXIMUM OF 20 HOURS PER WEEK ARE NOT
ENTITLED TO MILITARY LEAVE WITH PAY SINCE THEY ARE PART-TIME EMPLOYEES
AND NEITHER ACT OF JULY 1, 1947 NOR ACT OF JUNE 22, 1956, CONCERNING
SUBSTITUTE POSTAL EMPLOYEES, AUTHORIZES MILITARY LEAVE WITH PAY FOR
PART-TIME AND INTERMITTENT EMPLOYEES. LATE LEGISLATION RELATING TO
CLASSES OF EMPLOYEES ENTITLED TO SUCH PAY, NOW INCORPORATED IN 5 U.S.C.
6323, MERELY RESTATED AND CODIFIED LAW IN THIS RESPECT. SEE 35 COMP.
GEN. 5 (1955).
TO MR. POSTMASTER GENERAL:
THIS IS IN REPLY TO LETTER OF OCTOBER 6, 1969, FROM THE ASSISTANT
POSTMASTER GENERAL, BUREAU OF PERSONNEL, REQUESTING OUR DECISION AS TO
WHETHER CERTAIN HOURLY RATE REGULAR EMPLOYEES IN THE POSTAL FIELD
SERVICE ARE ENTITLED TO THE MILITARY LEAVE AUTHORIZED BY SECTION 6323 OF
TITLE 5, UNITED STATES CODE.
THE EMPLOYEES INVOLVED ARE GIVEN PERMANENT CAREER APPOINTMENTS FROM
COMPETITIVE EXAMINATIONS TO WORK A MAXIMUM OF 20 HOURS A WEEK. THEY
WORK ON AN ESTABLISHED SCHEDULE OF HOURS A DAY AND DAYS OF THE WEEK
WHICH SCHEDULE CONTINUES INDEFINITELY. THE QUESTION OF ENTITLEMENT
ARISES BECAUSE OF OUR DECISION 35 COMP. GEN. 5 (1955).
OUR DECISION 35 COMP. GEN. 5 HELD THAT UNDER THE ACT OF JULY 1, 1947,
61 STAT. 239, PART-TIME AND INTERMITTENT EMPLOYEES ARE NOT ENTITLED TO
MILITARY LEAVE WITH PAY. SUBSEQUENTLY, SUBSTITUTE EMPLOYEES IN THE
POSTAL FIELD SERVICE WERE GRANTED MILITARY LEAVE WITH PAY ON A PRO RATA
BASIS BY THE ACT OF JUNE 22, 1956, 70 STAT. 331. HOWEVER, THIS ACT DID
NOT GRANT MILITARY LEAVE WITH PAY TO OTHER INTERMITTENT OR PART-TIME
EMPLOYEES. LATER LEGISLATION, NOW INCORPORATED IN 5 U.S.C. 6323, MERELY
RESTATED AND CODIFIED THE LAW WITH RESPECT TO THE CLASSES OF EMPLOYEES
ENTITLED TO MILITARY LEAVE WITH PAY.
ACCORDINGLY, SINCE THE HOURLY RATE REGULAR EMPLOYEES INVOLVED ARE
PART-TIME EMPLOYEES, THEY ARE NOT ENTITLED TO MILITARY LEAVE WITH PAY.
B-167066, OCT. 28, 1969
SPECIFICATIONS--CONFORMABILITY OF EQUIPMENT, ETC; OFFERED--TECHNICAL
DEFICIENCIES--ADMINISTRATIVE DETERMINATION CONCLUSIVENESS
UNDER INVITATION FOR BIDS FOR ATOMIC BEAM-TYPE FREQUENCY STANDARD,
BRAND NAME OR EQUAL, PROVIDING THAT PROPOSALS TO MODIFY PRODUCT SHOULD
CONFORM TO BID REQUIREMENTS AND INCLUDE CLEAR DESCRIPTION OF PROPOSED
MODIFICATIONS, BIDDER WHO FAILED TO PROVIDE SATISFACTORY TECHNICAL
DETAILS IN OPINION OF PROCURING AGENCY, WAS PROPERLY NOT CONSIDERED FOR
AWARD, SINCE DETERMINATION AND EVALUATION OF TECHNICAL REQUIREMENTS ARE
MATTERS FOR ADMINISTRATIVE AGENCY, AND NO BASIS EXISTS FOR CONCLUSION
THAT CONTRACTING OFFICER'S DECISION WAS ARBITRARY, CAPRICIOUS OR
UNREASONABLE.
TO FREQUENCY ELECTRONICS, INCORPORATED:
REFERENCE IS MADE TO YOUR TELEFAX DATED MAY 27, 1969, AND LETTER
DATED JULY 22, 1969, PROTESTING AWARD TO ANY OTHER BIDDER UNDER
INVITATION FOR BIDS NO. NA00-9-412, ISSUED BY THE FEDERAL AVIATION
ADMINISTRATION.
THE SOLICITATION WAS ISSUED ON APRIL 1, 1969, BY THE CONTRACTS AND
PURCHASE BRANCH, FEDERAL AVIATION ADMINISTRATION, ATLANTIC CITY, NEW
JERSEY, FOR PROCUREMENT OF AN ATOMIC BEAM-TYPE FREQUENCY STANDARD TO BE
HEWLETT-PACKARD MODEL 5061A, OPTION 3, OR EQUAL IN ACCORDANCE WITH THE
,MAIN AND REQUIRED CHARACTERISTICS" LISTED IN THE INVITATION FOR BIDS.
THE MAIN AND REQUIRED CHARACTERISTICS LISTED ARE IN THE FOLLOWING AREAS:
ACCURACY
LONG TERM STABILITY
SHORT TERM STABILITY
REAL TIME OUTPUT
OUTPUTS
CLOCK PULSE
CLOCK DRIVE
HARMONIC DISTORTION
NOISE
STANDBY POWER CAPABILITY
TWO BIDS WERE RECEIVED AND WERE OPENED ON APRIL 17, 1969. THE
OFFERORS WERE FREQUENCY ELECTRONICS AND HEWLETT-PACKARD. FREQUENCY
ELECTRONICS, IN ITS BID, PROPOSED TO MODIFY AN EXISTING PIECE OF
EQUIPEMNT (MODEL 3701 FREQUENCY STANDARD) TO PRODUCE A NEW MODEL 3701B
WHICH IT STATED WOULD MEET THE SPECIFICATION REQUIREMENTS OF THE
SOLICITATION.
PARAGRAPH 25 (C) (2) OF THE GENERAL PROVISION OF THE INVITATION
"/2) IF THE BIDDER PROPOSES TO MODIFY A PRODUCT SO AS TO MAKE IT
CONFORM TO THE REQUIREMENTS OF THE INVITATION FOR BIDS, HE SHALL (I)
INCLUDE IN HIS BID A CLEAR DESCRIPTION OF SUCH PROPOSED MODIFICATIONS
AND (II) CLEARLY MARK ANY DESCRIPTIVE MATERIAL TO SHOW THE PROPOSED
MODIFICATIONS.' SEE ALSO SEC. 1-1.307-6 (A) (2) OF FEDERAL PROCUREMENT
REGULATIONS.
THE TECHNICAL EVALUATION PERSONNEL REPORTED TO THE CONTRACTING
OFFICER, AS FOLLOWS: "THE ACCURACY AND STABILITY OF A CESIUM BEAM
FREQUENCY STANDARD ARE DETERMINED NOT ONLY BY THE CHARACTERISTICS OF THE
CESIUM BEAM TUBE BUT BY THE VARIOUS ELEMENTS IN THE LOOP OR LOOPS USED
TO TUNE THE PRECISION QUARTZ OSCILLATOR TO ZERO FREQUENCY ERROR
(RELATIVE TO THE CENTER OF THE RESONANT FREQUENCY OF THE CESIUM ATOM).
THESE ELEMENTS INCLUDE THE PRECISION OSCILLATOR, FREQUENCY
MULTIPLICATION AND SYNTHESIS NETWORKS, AND FILTERING, AMPLIFICATION, AND
DETECTION CIRCUITRY. ERRORS AND INSTABILITIES IN ANY OF THESE ELEMENTS
WOULD EFFECT THE ACCURACY AND STABILITY OF THE FREQUENCY STANDARD, EVEN
IF THE CESIUM BEAM TUBE WERE HAND SELECTED FOR OPTIMUM ACCURACY.'NEITHER
THE BID NOR THE 7 MAY 1969 LETTER FROM ATOMICHRON PROVIDE ANY TECHNICAL
DETAILS OF HOW THE COMPANY WOULD EFFECT IMPROVEMENTS OR MODIFICATIONS TO
THE LOOP. IN OUR OPINION THIS WOULD BE REQUIRED, TO SOME EXTENT, TO
DOUBLE THE ACCURACY AND LONG-TERM STABILITY OF THEIR PRODUCTION MODEL
3701. IN OTHER WORDS, HAND SELECTION OF THE TUBE BY ITSELF WILL NOT, IN
OUR OPINION, GUARANTEE THE HIGHER ACCURACY.'IN SUMMARY, THE ATOMICHRON
COMPANY HAS NOT SUBMITTED SUFFICIENT ENGINEERING EVIDENCE IN THEIR
ORIGINAL BID AND SUBSEQUENT CORRESPONDENCE TO DEMONSTRATE THAT THEY
COULD SATISFACTORILY MODIFY THEIR STANDARD PRODUCTION MODEL 3701 CESIUM
BEAM FREQUENCY STANDARD TO MEET THE SPECIFICATIONS OF IFB NA00-9-412.
ADDITIONAL NEGOTIATIONS BETWEEN THIS CENTER AND THE COMPANY, IN AN
EFFORT TO SUFFICIENTLY DEFINE THEIR TECHNICAL APPROACH WOULD, IN OUR
OPINION, CAUSE PROCUREMENT DELAYS THAT WOULD NOT BE TOLERABLE. EVEN
THOUGH THE PROCUREMENT REQUEST DID NOT SPECIFY AN OFF-THE-SHELF ITEM,
THERE WAS A TACIT ASSUMPTION ON THE PART OF THE INITIATER THAT THE
REQUEST WAS FOR SUCH AN ITEM, RATHER THAN A DEVELOPMENT MODEL AS
PROPOSED BY ATOMICHRON.'
YOU STATE THAT FREQUENCY ELECTRONICS IS PRESENTLY MANUFACTURING A
QUANTITY OF THE EQUIPMENT CONCERNED HERE, SOME OF WHICH ARE FOR AN AIR
FORCE PROCUREMENT, AND THE ACCURACY REQUIREMENTS ARE THE SAME AS
REQUIRED IN THE INSTANT PROCUREMENT.
THE QUESTION AS TO THE ACTION, IF ANY, WHICH OUR OFFICE SHOULD TAKE
IN CASES INVOLVING THE EVALUATION OF TECHNICAL REQUIREMENTS OF
SPECIFICATIONS, ETC., HAS BEEN THE SUBJECT OF A NUMBER OF DECISIONS BY
OUR OFFICE. YOUR PROTEST IS BASED UPON SUCH AN EVALUATION. OF
NECESSITY, OUR OFFICE HAS ESTABLISHED A RULE GOVERNING SUCH SITUATIONS.
IN A DECISION DATED JANUARY 8, 1938, TO THE PRESIDENT, BOARD OF
COMMISSIONERS, DISTRICT OF COLUMBIA, 17 COMP. GEN. 554, 557 (1938), WE
SET FORTH THE FOLLOWING RULE WHICH WE CONSIDER TO BE CONTROLLING IN THE
INSTANT MATTER.
"IT IS THE PROVINCE OF ADMINISTRATIVE OFFICERS TO DRAFT PROPER
SPECIFICATIONS NECESSARY TO SUBMIT FOR FAIR COMPETITIVE BIDDING PROPOSED
CONTRACTS TO SUPPLY GOVERNMENT NEEDS, AND TO DETERMINE FACTUALLY WHETHER
ARTICLES OFFERED MEET THESE SPECIFICATIONS. * * *"
IN OUR DECISION, B-139830, DATED AUGUST 19, 1959, WE MADE THE
FOLLOWING OBSERVATION:
"THIS OFFICE HAS NEITHER AN ENGINEERING STAFF NOR A TESTING
LABORATORY TO EVALUATE THE TECHNICAL ASPECT OF SPECIFICATIONS.
MOREOVER, IN DISPUTES OF FACT BETWEEN A PROTESTANT AND A GOVERNMENT
AGENCY, WE USUALLY ARE REQUIRED TO ACCEPT THE ADMINISTRATIVE REPORT AS
CORRECT. WHETHER A PARTICULAR BID IS RESPONSIVE TO THE TECHNICAL DETAILS
OF THE SPECIFICATIONS IS NOT A MATTER ORDINARILY FOR OUR DETERMINATION.
* * *"
HERE, YOUR BID AND ACCOMPANYING TECHNICAL DETAILS, IN THE OPINION OF
THE TECHNICAL EVALUATORS, FAILED TO EXHIBIT IN THE MODIFIED FREQUENCY
STANDARD THE HIGH DEGREE OF ACCURACY REQUIRED BY THE SPECIFICATIONS. IN
THIS CONNECTION YOU ARE ADVISED THAT AN OVERALL OFFER, IN THE BID, TO
COMPLY WITH THE SPECIFICATIONS WHERE AN "OR EQUAL" ITEM IS OFFERED, WILL
NOT OVERCOME A REQUIRED SHOWING THAT THE OFFERED ITEM IS IN FACT "EQUAL"
TO THE NAMED PRODUCT. SEE B-145279, MAY 10, 1961.
WE CANNOT CONCLUDE ON THE BASIS OF THE RECORD BEFORE US OR YOUR
PRESENTATION THAT THE DETERMINATION MADE BY THE CONTRACTING OFFICER IN
THIS MATTER WAS ARBITRARY OR THAT THERE WAS NOT A REASONABLE BASIS FOR
HIS CONCLUSION.
B-167193, OCT. 28, 1969
OFFICERS AND EMPLOYEES--TRANSFERS--RELOCATION
EXPENSES--DEPENDENTS--SUBSISTENCE EXPENSES FOR CHILDREN WHILE PARENTS ON
HOUSE HUNTING TRIP
PERMANENTLY TRANSFERRED EMPLOYEE SEEKING REIMBURSEMENT OF BOARD AND
TUITION EXPENSE OF DEPENDENT CHILDREN PLACED IN BOARDING SCHOOL AUG. 13
TO 29 WHILE CLAIMANT AND WIFE WERE ON HOUSE-HUNTING TRIP MAY NOT BE
ALLOWED SUBSISTENCE EXPENSES AUTHORIZED IN SUBSECS. 2.5B (3) AND 2.5D
(1) OF BUREAU OF BUDGET CIR. NO. A-56 TO TRANSFERRED EMPLOYEES AND
FAMILY WHILE OCCUPYING TEMPORARY QUARTERS SINCE SUBSEC. 2.5B (3)
SPECIFICALLY PROVIDES THAT BENEFITS ARE PAYABLE ONLY AFTER EMPLOYEE
AND/OR FAMILY VACATE RESIDENCE QUARTERS OCCUPIED AT TIME OF TRANSFER.
SINCE CLAIMANT AND FAMILY DID NOT PERMANENTLY VACATE OLD QUARTERS UNTIL
SEPT. 2, HIS CHILDREN WERE NOT OCCUPYING TEMPORARY QUARTERS WITHIN
MEANING OF CONTROLLING REGULATIONS.
TO MR. RAYMOND L. MILOT:
THIS REFERS TO YOUR LETTERS OF OCTOBER 1, 1969, WITH ENCLOSURE, AND
OCTOBER 13, 1969, CONCERNING YOUR CLAIM FOR REIMBURSEMENT OF SUBSISTENCE
EXPENSES FOR YOUR CHILDREN DURING THE PERIOD YOU AND YOUR WIFE WERE ON A
HOUSE HUNTING TRIP.
BY TRAVEL AUTHORIZATION DATED AUGUST 18, 1966, YOU WERE AUTHORIZED TO
TRAVEL FROM PORTSMOUTH, RHODE ISLAND, TO KANSAS CITY, MISSOURI, INCIDENT
TO A PERMANENT CHANGE OF STATION. YOU PLACED FIVE OF YOUR CHILDREN IN
THE MOUNT ST. JOSEPH SCHOOL ON AUGUST 13, 1966, AND THE RECEIPT
FURNISHED SHOWS THE COST FOR BOARD AND TUITION FROM AUGUST 13 TO AUGUST
29 WAS $120. YOU ARE CLAIMING $84.71 OF THIS AMOUNT FOR THE PERIOD
BEGINNING WITH AUGUST 18, 1966, AS TEMPORARY SUBSISTENCE EXPENSES. THE
RECORD SHOWS YOU LEFT YOUR HEADQUARTERS ON AUGUST 13, 1966, TOOK LEAVE
EN ROUTE AND RETURNED ON AUGUST 31, 1966. YOU AND YOUR FAMILY SPENT TWO
NIGHTS IN YOUR HOME AND DEPARTED FOR YOUR NEW RESIDENCE AT WATERLOO,
IOWA, ON SEPTEMBER 2, 1966.
SECTION 2.5 OF BUREAU OF THE BUDGET CIRCULAR NO. A-56 PROVIDES FOR
THE PAYMENT OF SUBSISTENCE EXPENSES OF THE EMPLOYEE AND HIS IMMEDIATE
FAMILY WHILE OCCUPYING TEMPORARY QUARTERS WHEN AN EMPLOYEE IS
TRANSFERRED TO A NEW OFFICIAL STATION.
SUBSECTIONS 2.5B (3) AND 2.5D (1) OF CIRCULAR NO. A-56 PROVIDE THAT:
"2.5B (3) TEMPORARY QUARTERS REFER TO LODGING OBTAINED TEMPORARILY,
AFTER A TRANSFER HAS BEEN AUTHORIZED OR APPROVED AND AFTER THE EMPLOYEE
AND/OR MEMBERS OF HIS IMMEDIATE FAMILY VACATE THE RESIDENCE QUARTERS IN
WHICH THEY WERE RESIDING AT THE TIME OF THE TRANSFER, UNTIL THE EMPLOYEE
MOVES, WITHIN THE ALLOWABLE 30 OR 60 DAYS' TIME LIMIT, INTO PERMANENT
RESIDENCE QUARTERS.
"2.5D (1) REIMBURSEMENT SHALL BE ONLY FOR ACTUAL SUBSISTENCE EXPENSES
INCURRED PROVIDED THESE ARE DIRECTLY RELATED TO OCCUPANCY OF TEMPORARY
QUARTERS AND ARE REASONABLE BOTH AS TO AMOUNT AND DURATION. ALLOWABLE
SUBSISTENCE EXPENSES INCLUDE ONLY CHARGES FOR MEALS, LODGING, FEES AND
TIPS INCIDENT TO MEALS AND LODGING, LAUNDRY, CLEANING AND PRESSING OF
CLOTHING. THE ACTUAL EXPENSES SHALL BE SUPPORTED AS PROVIDED IN
SUBSECTION 6.12F OF THE STANDARDIZED GOVERNMENT TRAVEL REGULATIONS.
EXPENSES OF LOCAL TRANSPORTATION INCURRED FOR ANY PURPOSE DURING
OCCUPANCY OF TEMPORARY QUARTERS SHALL BE DISALLOWED.'
IT IS SPECIFICALLY PROVIDED IN SECTION 2.5 OF CIRCULAR NO. A-56 THAT
THE BENEFITS PROVIDED THEREIN ARE PAYABLE ONLY AFTER THE EMPLOYEE AND/OR
MEMBERS OF HIS FAMILY VACATE THE RESIDENCE QUARTERS IN WHICH THEY WERE
RESIDING AT THE TIME OF TRANSFER.
SINCE YOU AND YOUR FAMILY DID NOT PERMANENTLY VACATE YOUR RESIDENCE
QUARTERS AT YOUR OLD DUTY STATION UNTIL SEPTEMBER 2, 1966, YOUR CHILDREN
WERE NOT RESIDING IN TEMPORARY QUARTERS AS DEFINED BY THE CONTROLLING
REGULATIONS DURING THE PERIOD IN QUESTION.
THEREFORE, THERE IS NO AUTHORITY TO ALLOW THAT PART OF YOUR CLAIM FOR
SUBSISTENCE EXPENSES OF YOUR CHILDREN.
B-167321, OCT. 28, 1969
TO RED BALL MOTOR FREIGHT, INC.:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 8, 1969, RELATIVE TO
YOUR CLAIM OC-76563, WHICH OUR LETTER OF JULY 22, 1969, B-167321,
ADVISED WOULD BE HANDLED AS A CLAIM FOR REFUND OF THE SUM OF $168.44
DEDUCTED. WE NOW HAVE ASCERTAINED THIS CLAIM WAS THE SUBJECT OF OUR
TRANSPORTATION DIVISION'S SETTLEMENT CERTIFICATE DATED APRIL 10, 1969
(TK-884773). THE SETTLEMENT DISALLOWED YOUR CLAIM FOR $168.44 ON A
SHIPMENT TRANSPORTED FROM LONE STAR ARMY AMMUNITION PLANT, DEFENSE,
TEXAS, TO COLORADO SPRINGS, COLORADO, WITH A STOPOFF FOR PARTIAL
UNLOADING AT PUEBLO ARMY DEPOT, AVONDALE, COLORADO, UNDER GOVERNMENT
BILL OF LADING E-6953368, DATED JUNE 3, 1967.
WE HAVE EXAMINED THE CLAIM AND HAVE INSTRUCTED OUR TRANSPORTATION
DIVISION TO REOPEN THE SETTLEMENT AND TO ALLOW YOU THE AMOUNT CLAIMED,
IF OTHERWISE CORRECT. NOTICE OF THE REVISED SETTLEMENT SHOULD REACH YOU
IN DUE COURSE.
B-167477, OCT. 28, 1969
NEGOTIATION--CHANGES, ETC.--SPECIFICATIONS
UNDER REQUEST FOR PROPOSALS FOR URGENTLY NEEDED DRILLING MACHINES
AMENDED TO DELETE STRINGENT REQUIREMENTS WHEN COMMERCIAL MODEL WAS
CONSIDERED MORE ACCEPTABLE, WHERE UNSUCCESSFUL OFFEROR SUBMITTED
PROPOSAL BASED ON DELETED REQUIREMENTS WHICH ALLEGEDLY RESULTED FROM
ADVICE OF CONTRACTING OFFICER AND CONTENDED THAT REVISED ITEM
DESCRIPTION DID NOT MEET GOVERNMENT'S MINIMUM NEEDS, BUT ADMINISTRATIVE
REPORT FAILED TO EVIDENCE ALLEGED TELEPHONIC ADVICE AND LOW OFFER WAS
FOUND TECHNICALLY ACCEPTABLE, THERE IS NO IMPROPRIETY IN AWARD BECAUSE
IN FACTUAL DISPUTES ADMINISTRATIVE REPORT WILL BE ACCEPTED GENERALLY AND
DETERMINATION OF GOVT.'S NEEDS AND DRAFTING OF SPECIFICATIONS ARE
FUNCTIONS OF CONTRACTING OFFICER WHICH IS NOT DISTURBED IN ABSENCE OF
CLEAR AND CONVINCING EVIDENCE OF ERROR AND RECORD DOES NOT SUPPORT
CONCLUSION THAT ADMINISTRATIVE REPORT OR DETERMINATION OF GOVT.'S NEEDS
WAS ERRONEOUS.
TO WESTINGHOUSE AIR BRAKE COMPANY:
FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JULY 11, 1969, AND
SUBSEQUENT CORRESPONDENCE, PROTESTING AGAINST THE AWARD OF A CONTRACT TO
THE WINTER-WEISS COMPANY UNDER REQUEST FOR PROPOSALS (RFP) NO.
DAAK01-69-R-8940, ISSUED BY THE ARMY MOBILITY EQUIPMENT COMMAND (MECOM).
THE RFP WAS ISSUED ON MAY 19, 1969, UNDER THE AUTHORITY OF 10 U.S.C.
2304 (A) (2), TO SATISFY AN URGENT REQUIREMENT FOR 14 TRAILER MOUNTED
WELL DRILLING MACHINES. THE CLOSING DATE FOR RECEIPT OF PROPOSALS WAS
JUNE 9, 1969. THE PROCUREMENT WAS SYNOPSIZED INTHE COMMERCE BUSINESS
DAILY AND COPIES OF THE RFP WERE SENT TO 24 FIRMS, OF WHICH 6 SUBMITTED
PROPOSALS.
ITEM 0001 OF THE RFP DESCRIBED THE WELL DRILLING MACHINES AS FOLLOWS:
"DRILLING MACHINE, WELL, COMBINATION, DRILLING CAPACITY 7-7/8 INCHES
MIN DIA OF HOLE, 1500 FT. DRILLING DEPTH, DIESEL ENGINE, POWERED, DRILL
FRAME FOLDING MAST, HYDRAULICALLY RAISED AND LOWERED, 2 HOIST DRUMS, 2)
CATHEAD, ROTARY DRIVE-HEAD, RECIPROCATING TYPE PUMP, 150 CPM AT 310 PSI
POWERED THROUGH POWER TAKE-OFF, SEMI-TRAILER MTD, W/ACCESSORIES FOR
FLUID DRILLING AND PERCUSSION DRILLING IN ACCORDANCE WITH PURCHASE
DESCRIPTION HQPD69-2, DATED 12 MARCH 1969 AND CHANGE, DATED 15 APRIL 69
WITH MODIFICATION AS SPECIFIED IN ARTICLE 2.' ONLY YOUR PROPOSAL MET
THESE REQUIREMENTS. ON JUNE 4, 1969, MECOM WAS ADVISED THAT THE NEED
FOR THE MACHINES, WHICH WERE TO BE USED IN VIETNAM, WAS CRITICAL AND
THAT THE SITUATION WAS BECOMING MORE ACUTE. IT WAS THEN DETERMINED THAT
A COMMERCIAL MODEL WELL DRILLING MACHINE, RATHER THAN THE ONE DESCRIBED
IN HQPD69-2, WOULD MEET THE GOVERNMENT'S MINIMUM REQUIREMENTS AND AFFORD
AN EARLIER DELIVERY SCHEDULE. ON JUNE 11, 1969, THE CONTRACTING OFFICER
SENT A TELEGRAM TO ALL WHO HAD REQUESTED COPIES OF THE RFP, STATING IN
PERTINENT PART:
"SUBJECT: AMENDMENT TO RFP DAAK01-69-R-8940 PROCUREMENT FOR WELL
DRILLING MACHINES, TRAILER MOUNTED.'1. DESCRIPTION OF ITEM 0001 IS
DELETED AND THE FOLLOWING IS SUBSTITUTED THEREFORE: -COMMERCIAL MODEL
WELL-DRILLING MACHINE SEMI-TRAILER MTD, COMBINATION AIR AND MUD,
DOWN-THE-HOLE DRILLING CAPABILITY USING A SIX INCH BIT TO A 200 FT DEPTH
AND RATED TO DRILL 1500 FEET USING MUD. ACCESSORIES, HAND TOOLS AND
SUPPLIES SHALL BE EQUIVALENT IN NUMBER AND DRILLING LIFE EXPECTANCY TO
THOSE LISTED IN HQPD-69-2 AND COMPATIBLE FOR USE WITH MACHINE BID. TOP
DRIVE OR KELLY DRIVE MACHINES WILL BE CONSIDERED. -" OF THE SEVEN OFFERS
RECEIVED IN RESPONSE TO THE JUNE 11 TELEGRAM WINTER-WEISS WAS THE LOW
OFFEROR AND YOUR FIRM WAS FOURTH LOW. THE WINTER-WEISS PROPOSAL WAS
FOUND TO BE TECHNICALLY ACCEPTABLE AND REASONABLY PRICED. ON JUNE 26,
1969, CONTRACT NO. DAAK01-69-C-A382 WAS AWARDED TO WINTER-WEISS.
YOUR INITIAL CONTENTION IS THAT THE AWARD TO WINTER-WEISS WAS
IMPROPER BECAUSE IT WAS "BASED ON A REVIEW OF THE BIDS RECEIVED WHICH
DID NOT COMPARE LIKE OFFERS FROM THE VARIOUS BIDDERS.' YOU CLAIM TO HAVE
SUBMITTED AN OFFER OF MORE SUBSTANTIAL EQUIPMENT THAN ANY OF THE OTHER
SIX OFFERORS, WHICH YOU ASSERT RESULTED FROM A TELEPHONE CONVERSATION IN
WHICH YOU WERE MISLED BY THE CONTRACTING OFFICER. YOU HAVE ALSO
CONTENDED THAT SUBSEQUENT TO THE TELEGRAPHIC AMENDMENT, THE GOVERNMENT
DECIDED TO OBTAIN LESSER EQUIPMENT, BUT FAILED TO INFORM YOU OF ITS
REDUCED REQUIREMENTS. FINALLY, YOU MAINTAIN THAT THE UNITS BEING
SUPPLIED BY WINTER-WEISS WILL NOT ADEQUATELY SERVE THE GOVERNMENT'S
NEEDS.
THE ORIGINAL RFP REQUIRED THE MACHINES TO CONFORM TO PURCHASE
DESCRIPTION HQPD 69-2, AS AMENDED, WHICH WAS A 30-PAGE DESIGN
SPECIFICATION FOR WELL DRILLING MACHINES AND ACCOMPANYING HAND TOOLS,
FLUID AND PERCUSSION DRILLING ACCESSORIES, AND SUPPLIES. PARAGRAPHS
3.6, 3.10 AND 3.16 OF HQPD 69-2 HAVE PARTICULAR RELEVANCE TO YOUR
PROTEST. THESE PARAGRAPHS RESPECTIVELY REQUIRE THE MACHINES TO BE
POWERED BY A GMC 8V7-71 DIESEL ENGINE OF 227 BHP AT 1,800 RPM; TO HAVE
A 42-FOOT MAST AND TO HAVE AN AIR COMPRESSOR CAPABLE OF DELIVERING 470
CFM OF AIR AT 250 PSI. WHEN THE RFP WAS AMENDED BY THE TELEGRAM OF JUNE
11, ALL OFFERS IN RESPONSE TO THE AMENDMENT, EXCEPT YOURS, WERE
SUBMITTED UPON SMALLER PIECES OF EQUIPMENT. FOR EXAMPLE, WINTER-WEISS
OFFERED A 33-FOOT MAST INSTEAD OF A 42-FOOT MAST; A 125 PSI AIR
COMPRESSOR INSTEAD OF A 250 PSI UNIT; AND A SMALLER GMC 6V7 ENGINE
INSTEAD OF THE 8V7-71 ENGINE OFFERED BY YOU. YOU HAVE STATED THAT YOU
WERE LED TO BELIEVE THAT THE MORE STRINGENT REQUIREMENTS OF HQPD 69-2
WERE APPLICABLE BY REASON OF A TELEPHONE CONVERSATION BETWEEN YOUR
REPRESENTATIVES AND THE CONTRACTING OFFICER. AS RELATED IN YOUR LETTER
OF SEPTEMBER 18, 1969:
"IN ORDER TO MEET THE ORIGINAL BID OPENING DATE, WHICH WAS JUNE 9,
1969, TWO REPRESENTATIVES OF WABCO PERSONALLY DELIVERED OUR BID AND IT
WAS DEPOSITED AT APPROXIMATELY 11:00 A.M. ON JUNE 9, 1969. THE
FOLLOWING DAY, JUNE 10, AT 1:00 P.M., OUR PEOPLE HAD A CONFERENCE WITH
THE CONTRACTING OFFICER IN ST. LOUIS, AND HE SHOWED THEM A WIRE HE WAS
SENDING OUT TO ALL PROSPECTIVE BIDDERS AMENDING RFP NO.
DAAK-01-69-R-8940.
"IT IS NOTED IN THE ADMINISTRATIVE REPORT THAT -WABCO WAS CALLED AND
ADVISED OF THE CHANGE AND WAS GIVEN AN OPPORTUNITY TO ASK QUESTIONS,
WHICH THEY DID NOT DO.- THIS STATEMENT IS IN ERROR. IT IS TRUE THAT THE
WABCO REPRESENTATIVES DID NOT HAVE ANY QUESTIONS DURING THIS PARTICULAR
MEETING WITH THE CONTRACTING OFFICER, HOWEVER, BEFORE THEY LEFT ST.
LOUIS, AND AFTER FURTHER STUDY AND THOUGHT ON THE TELEGRAM, THEY DID
HAVE A QUESTION ON THE AIR COMPRESSOR WHICH THEY BELIEVED NEEDED FURTHER
CLARIFICATION. APPROXIMATELY 2:30 P.M. THE SAME AFTERNOON, OUR PEOPLE
MADE A CALL TO THE CONTRACTING OFFICER FROM ST. CHARLES, MISSOURI, WHICH
IS A SUBURB OF ST. LOUIS, TO DISCUSS THE SIZE AIR COMPRESSOR THAT WOULD
BE ACCEPTABLE. BECAUSE OF THE GENERAL WORDING OF THE TELEGRAM, HE
ADVISED THE CONTRACTING OFFICER THAT DUE TO A GREAT DIFFERENCE IN PRICE
THAT SOME OF THE BIDDERS WOULD OFFER A 125 PSI AIR COMPRESSOR, A SMALLER
ENGINE AND A SMALLER TRAILER. THE WABCO REPRESENTATIVE WAS TOLD ON THE
PHONE BY THE CONTRACTING OFFICER THAT IF HE WOULD HOLD ON THE LINE, HE
WOULD CHECK WITH HIS LEGAL DEPARTMENT FOR ASSISTANCE IN REPLYING TO OUR
QUESTION. AFTER THE CONTRACTING OFFICE CHECKED WITH HIS LEGAL
DEPARTMENT, HE ADVISED OUR REPRESENTATIVE THAT ALL BIDDERS, IN ORDER TO
BE CONSIDERED, MUST OFFER A 250 PSI COMPRESSOR IN ORDER TO OPERATE THE
5-1/4 INCH DOWN-THE-HOLE TOOL LISTED UNDER ACCESSORIES FOR PERCUSSION
DRILLING OF PURCHASE DESCRIPTION HQPD 69-2. DUE TO THE FACT THAT THE
HIGH PRESSURE TOOL IS MUCH MORE EFFICIENT AND THAT THE CONTRACTING
OFFICER STATED THAT WE MUST OFFER THE 250 PSI COMPRESSOR, WE DID NOT
OFFER A SMALLER UNIT EQUIPPED WITH THE 125 PSI COMPRESSOR.
"ALL DRILLING UNITS OFFERED BY WINTER-WEISS AND THE OTHER BIDDERS
WERE ALSO AVAILABLE EQUIPPED WITH EITHER THE SMALLER OR LARGER AIR
COMPRESSORS, HOWEVER, DUE TO THE GREAT PRICE DIFFERENCE BETWEEN THE
COMPRESSORS, THEY OFFERED THE SMALL COMPRESSOR. WE, TOO, WOULD HAVE
OFFERED THE SMALL COMPRESSOR HAD WE NOT BEEN ADVISED BY THE CONTRACTING
OFFICER THAT OUR OFFER WOULD NOT BE CONSIDERED IF WE OFFERED ANYTHING
LESS THAN THE 250 PSI COMPRESSOR.'
HOWEVER, THE ADMINISTRATIVE RECORD CONTAINS THE FOLLOWING STATEMENT
BY THE CONTRACTING OFFICER:
"THE UNDERSIGNED HEREBY STATES THAT HE DID NOT RECEIVE A TELEPHONE
CALL FROM THE WESTINGHOUSE AIR BRAKE CO. QUESTIONING THE SIZE OF THE AIR
COMPRESSOR TO BE CONSIDERED ON THE PROCUREMENT OF THE WELL DRILLING
MACHINES.' THIS CREATES A DISPUTED QUESTION OF FACT. WHEN THERE IS A
CONFLICT BETWEEN THE STATEMENT OF A CLAIMANT AND THE ADMINISTRATIVE
REPORT, IT IS A LONG ESTABLISHED RULE OF THIS OFFICE TO ACCEPT THE
LATTER, UNLESS THERE IS SUFFICIENT EVIDENCE TO ESTABLISH BEYOND ANY
REASONABLE DOUBT THAT THE REPORTED FACTS ARE INCORRECT, 37 COMP. GEN.
568; B-162344, NOVEMBER 8, 1967; B-160110, DECEMBER 1, 1966. WE DO
NOT FIND SUCH EVIDENCE IN THE PRESENT RECORD.
YOUR SECOND ARGUMENT IS THAT ALTHOUGH THE CONTRACTING OFFICER TOLD
YOU A 250 PSI COMPRESSOR MUST BE FURNISHED, HE SUBSEQUENTLY RELAXED THE
REQUIREMENTS WITHOUT NOTIFYING YOU. SINCE THIS REQUIREMENT APPEARED
ONLY IN PURCHASE DESCRIPTION HQPD 69-2, WHICH WAS DELETED BY THE JUNE 11
AMENDMENT, THIS ARGUMENT IS NECESSARILY DEPENDENT UPON ESTABLISHMENT OF
THE CONTRACTING OFFICER'S SUBSEQUENT ADVICE TO YOU THAT THE 250 PSI
REQUIREMENT FOR THE AIR COMPRESSOR REMAINED IN EFFECT. IN VIEW OF OUR
CONCLUSION EXPRESSED ABOVE, WE FIND NO MERIT IN YOUR SECOND CONTENTION.
FINALLY, IN SUPPORT OF YOUR CONTENTION THAT AWARD TO WINTER-WEISS WAS
IMPROPER, YOU REFER TO YOUR EXPERIENCE IN SUPPLYING WELL DRILLING
MACHINES TO THE GOVERNMENT, ESPECIALLY YOUR ROLE AS A CONSULTANT TO THE
ARMY IN THE DRAFTING OF PURCHASE DESCRIPTION HQPD 69-2. BASED UPON YOUR
KNOWLEDGE OF THE NEEDS OF THE MILITARY, YOU ASSERT THAT THE WINTER WEISS
EQUIPMENT WILL PROVE UNSATISFACTORY AND IS INADEQUATE FOR THE DEMANDS
WHICH WILL BE PLACED UPON IT. YOU PLACE PARTICULAR EMPHASIS UPON THE
ACCEPTANCE OF A SMALLER COMPRESSOR, WHICH IS LESS EFFICIENT THAN THE ONE
YOU OFFERED. THE AGENCY DOES NOT AGREE WITH YOUR CONTENTIONS, AND
POINTS OUT THAT ALL OFFERS RESPONDING TO THE AMENDMENT WERE TECHNICALLY
ACCEPTABLE AND MET MECOM'S NEEDS, INCLUDING THE REQUIREMENT FOR RAPID
DELIVERY. WE HAVE CONSISTENTLY HELD THAT THE DETERMINATION OF THE
GOVERNMENT'S NEEDS, THE DRAFTING OF SPECIFICATIONS TO MEET THOSE NEEDS,
AND THE DETERMINATION WHETHER OFFERORS WILL FURNISH PRODUCTS MEETING
SPECIFICATION REQUIREMENTS, ARE PRIMARILY FUNCTIONS OF THE CONTRACTING
AGENCY, WHICH SHALL NOT BE DISTURBED BY OUR OFFICE IN THE ABSENCE OF
CLEAR AND CONVINCING EVIDENCE OF ERROR. B-151076, AUGUST 12, 1963;
B-150532, MARCH 1, 1963; B-149917, OCTOBER 19, 1962. WE FIND NO SUCH
ERROR ON THE PRESENT RECORD.
IN VIEW OF THE FOREGOING, WE CONCLUDE THAT THERE WAS NO IMPROPRIETY
IN THE AWARD TO WINTER WEISS, AND YOUR PROTEST MUST BE DENIED.
B-167478, OCT. 28, 1969
NEGOTIATION--LATE PROPOSALS AND QUOTATIONS--REJECTION PROPRIETY
UNDER AIR FORCE REQUEST FOR PROPOSALS (RFP) ON MODULAR RELOCATION
FACILITIES ITEMS, PROPOSAL OF LOW OFFEROR WHICH WAS MAILED ON CLOSING
DATE AND RECEIVED 2 DAYS LATER, WAS PROPERLY REFUSED CONSIDERATION SINCE
IT WAS PROTESTANT'S RESPONSIBILITY TO MAIL PROPOSAL IN TIME FOR OPENING,
AND UNDER PERTINENT REGULATIONS--- INCORPORATED INTO SUBJECT RFP -- LATE
PROPOSAL MAY BE CONSIDERED ONLY IF IT IS DETERMINED LATE RECEIPT WAS DUE
TO DELAY IN MAILS, OR SOLELY TO MISHANDLING BY GOVERNMENT AFTER RECEIPT.
MOREOVER, EXCEPTION IN ARMED SERVICES PROCUREMENT REGULATION 3-506 (C)
(II) -- AUTHORIZING CONSIDERATION OF LATE PROPOSALS THAT ARE OF EXTREME
IMPORTANCE TO GOVT; SUCH AS TECHNICAL OR SCIENTIFIC BREAKTHROUGHS --
HAS NEVER BEEN JUSTIFIED ON BASIS OF PRICE ADVANTAGE IF OTHER AVAILABLE
PRICE IS REASONABLE.
TO QED MODULAR BUILDINGS, INC.:
WE REFER TO YOUR LETTER AND TELEGRAM OF JULY 11, 1969, TO THIS
OFFICE, AND COPIES OF LETTERS TO OTHER GOVERNMENT OFFICIALS DATED JULY
29 AND AUGUST 15, SETTING FORTH YOUR PROTEST AGAINST THE AWARD OF
CONTRACTS TO ANY OTHER FIRMS UNDER REQUESTS FOR PROPOSALS (RFP) NOS.
F09603-69-R-2641 AND F09603-69-R-3156, ISSUED BY ROBINS AIR FORCE BASE,
GEORGIA.
THE FIRST PART OF YOUR PROTEST CONCERNS RFP NO. F09603-69-R-2641.
THIS RFP, ISSUED PURSUANT TO 10 U.S.C. 2304 (A) (2), ON MARCH 3, 1969,
AS AMENDED, SOLICITED PROPOSALS ON 13 ITEMS OF MODULAR RELOCATABLE
SCHOOL FACILITIES FOR USE OUTSIDE THE CONTINENTAL UNITED STATES.
AMENDMENT 0003 TO THE RFP FIXED THE CLOSING DATE FOR RECEIPT OF
PROPOSALS AT 2400 HOURS, EST, APRIL 10, 1969, IN ROBINS AIR FORCE BASE,
GEORGIA. PARAGRAPH 8 OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS,
ENTITLED ,LATE OFFERS AND MODIFICATIONS OR WITHDRAWALS," AMONG OTHER
THINGS, PROVIDED:
"/A) OFFERS AND MODIFICATIONS OF OFFERS (OR WITHDRAWALS THEREOF, IF
THIS SOLICITATION IS ADVERTISED) RECEIVED AT THE OFFICE DESIGNATED IN
THE SOLICITATION AFTER THE EXACT HOUR AND DATE SPECIFIED FOR RECEIPT
WILL NOT BE CONSIDERED UNLESS: (1) THEY ARE RECEIVED BEFORE AWARD IS
MADE; AND EITHER (2) THEY ARE SENT BY REGISTERED MAIL, OR BY CERTIFIED
MAIL FOR WHICH AN OFFICIAL DATED POST OFFICE STAMP (POSTMARK) ON THE
ORIGINAL RECEIPT FOR CERTIFIED MAIL HAS BEEN OBTAINED, OR BY TELEGRAPH
IF AUTHORIZED, AND IT IS DETERMINED BY THE GOVERNMENT THAT THE LATE
RECEIPT WAS DUE SOLELY TO DELAY IN THE MAILS, OR DELAY BY THE TELEGRAPH
COMPANY, FOR WHICH THE OFFEROR WAS NOT RESPONSIBLE; OR (3) IF SUBMITTED
BY MAIL (OR BY TELEGRAM IF AUTHORIZED) IT IS DETERMINED BY THE
GOVERNMENT THAT THE LATE RECEIPT WAS DUE SOLELY TO MISHANDLING BY THE
GOVERNMENT AFTER RECEIPT AT THE GOVERNMENT INSTALLATION; PROVIDED, THAT
TIMELY RECEIPT AT SUCH INSTALLATION IS ESTABLISHED UPON EXAMINATION OF
AN APPROPRIATE DATE OR TIME STAMP (IF ANY) OF SUCH INSTALLATION, OR OF
OTHER DOCUMENTARY EVIDENCE OF RECEIPT (IF READILY AVAILABLE) WITHIN THE
CONTROL OF SUCH INSTALLATION OR OF THE POST OFFICE SERVING IT. HOWEVER,
A MODIFICATION OF AN OFFER WHICH MAKES THE TERMS OF THE OTHERWISE
SUCCESSFUL OFFER MORE FAVORABLE TO THE GOVERNMENT WILL BE CONSIDERED AT
ANY TIME IT IS RECEIVED AND MAY THEREAFTER BE ACCEPTED.'
TWO PROPOSALS WERE TIMELY RECEIVED. HOWEVER, YOUR PROPOSAL, WHICH
WAS NOT MAILED UNTIL APRIL 10, 1969, THE CLOSING DATE FOR RECEIPT OF
PROPOSALS, WAS RECEIVED AT ROBINS AIR FORCE BASE ON APRIL 12, 1969. BY
LETTER OF MAY 29, 1969, THE CONTRACTING OFFICER ADVISED YOU THAT YOUR
PROPOSAL WAS NOT CONSIDERED FOR AWARD BECAUSE IT ARRIVED LATE. ALTHOUGH
YOUR PROPOSAL WAS LOW AT $4,080,813, AWARD WAS MADE ON JULY 8, 1969, TO
MODULUX INCORPORATED FOR THE AMOUNT OF $4,226,119.92.
IN YOUR LETTER OF JULY 11, 1969, YOU ALLEGE THAT YOUR PROPOSAL WAS
TENDERED ON THE DAY OF THE BID OPENING THROUGH CERTIFIED MAIL, AND YOU
CONTEND THAT IT WAS RESPONSIVE TO THE RFP BECAUSE IT WAS RECEIVED BEFORE
ANY AWARD HAD BEEN MADE, AND PROTEST THE AWARD MADE AT A HIGHER PRICE
THAN YOURS.
ARMED SERVICES PROCUREMENT REGULATION (ASPR) 3-505 REQUIRES THAT
REQUESTS FOR PROPOSALS CONTAIN A CLAUSE NOTIFYING THE PROSPECTIVE
OFFERORS THAT LATE PROPOSALS OR MODIFICATIONS TO PROPOSALS RECEIVED
AFTER THE DATE FOR SUBMISSION HAS PASSED WILL NOT BE CONSIDERED. HERE,
YOUR PROPOSAL ARRIVED ON APRIL 12, 1969, TWO DAYS SUBSEQUENT TO THE
CLOSING DATE SPECIFIED BY AMENDMENT 0003, DATED MARCH 28, 1969. ASPR
3-505 (A) REQUIRES CONTRACTING OFFICERS TO TREAT SUCH LATE PROPOSALS OR
MODIFICATIONS IN THE SAME MANNER THAT THEY WOULD BE TREATED UNDER
ADVERTISED PROCUREMENT. SEE B-151944, MARCH 18, 1969. UNDER PARAGRAPH
8 OF THE RFP, WHICH IS IN ACCORDANCE WITH PERTINENT REGULATIONS, YOUR
LATE PROPOSAL COULD HAVE BEEN CONSIDERED FOR AWARD ONLY IF IT WAS
DETERMINED THAT LATE RECEIPT WAS DUE SOLELY TO DELAY IN THE MAILS, OR
SOLELY TO MISHANDLING BY THE GOVERNMENT AFTER RECEIPT AT THE
INSTALLATION.
POST OFFICE DEPARTMENT FORM 1510, DATED APRIL 14, 1969, DISCLOSES
THAT YOUR CERTIFIED LETTER CONTAINING THE PROPOSAL (ASSIGNED CERTIFIED
NO. 676253), WAS MAILED APRIL 10, 1969, AT 1500 HOURS, IN SAN PABLO,
CALIFORNIA. THE RECORD CONTAINS A SUMMARY OF CONVERSATION WITH A
REPRESENTATIVE OF THE POST OFFICE ABOUT THE POSSIBILITY FOR A DOCUMENT
WHICH IS MAILED FROM CALIFORNIA ON APRIL 10, 1969, TO ARRIVE BY MIDNIGHT
ON THE SAME DAY AT ROBINS AIR FORCE BASE. IT IS STATED THAT REGARDLESS
OF HOW A DOCUMENT IS MAILED, IT COULD NOT MEET THE TRUCKS DELIVERING THE
MAIL FROM ATLANTA TO ROBINS AIR FORCE BASE ON THE SAME DAY. THEREFORE,
AND SINCE IT WAS YOUR RESPONSIBILITY TO SEE THAT THE PROPOSAL WAS
PROPERLY MAILED IN TIME TO REACH THE DESIGNATED OFFICE BEFORE THE TIME
FIXED FOR OPENING, THE CONTRACTING OFFICER ACTED PROPERLY IN REFUSING TO
CONSIDER YOUR LATE PROPOSAL. SEE B-159928, NOVEMBER 10, 1966.
AN EXCEPTION TO THE LATENESS RULE IS PERMISSIBLE WHEN A DETERMINATION
IS MADE AT THE SECRETARIAL LEVEL THAT CONSIDERATION OF A LATE PROPOSAL
IS OF "EXTREME IMPORTANCE TO THE GOVERNMENT, AS FOR EXAMPLE WHERE IT
OFFERS SOME IMPORTANT TECHNICAL OR SCIENTIFIC BREAKTHROUGH.' SEE ASPR
3-506 (C) (II). IT HAS NEVER BEEN CONSIDERED THAT A MERE PRICE
ADVANTAGE JUSTIFIES APPLICATION OF THIS EXCEPTION WHERE THE PRICE
OTHERWISE AVAILABLE IS REASONABLE. SINCE THE MODULAR RELOCATABLE SCHOOL
FACILITIES ARE TO BE PROCURED IN ACCORDANCE WITH DRAWINGS AND
SPECIFICATIONS FURNISHED BY THE GOVERNMENT, THERE CAN BE NO QUESTION OF
OFFERING ANY TECHNICAL OR SCIENTIFIC BREAKTHROUGH AS CONTEMPLATED BY THE
REGULATION. SEE 46 COMP. GEN. 42.
THE SECOND PART OF YOUR PROTEST CONCERNS RFP NO. F09603-69-R-3156.
THIS RFP SOLICITED PROPOSALS ON ITEMS 1 THROUGH 4 CONSISTING OF
RELOCATABLE MEDICAL FACILITIES, AND WAS ISSUED ON APRIL 24, 1969. THE
RFP WAS OPENED ON MAY 26, 1969, AND YOUR PROPOSAL APPEARED TO BE THE
LOWEST RECEIVED. ON THE BASIS OF A PRE-AWARD SURVEY CONDUCTED BY THE
DEFENSE CONTRACT ADMINISTRATION SERVICES REGION (DCASR/-SAN FRANCISCO
PURSUANT TO ASPR 1-905.4, IT WAS DETERMINED THAT YOU COULD NOT BE
CONSIDERED A RESPONSIBLE CONTRACTOR FOR THE PROCUREMENT.
YOUR LETTERS OF JULY 29 AND AUGUST 15, TAKE ISSUE WITH THE
CONTRACTING OFFICER'S DETERMINATION OF QED'S NONRESPONSIBILITY.
HOWEVER, BY LETTER OF SEPTEMBER 22, 1969, THE CHIEF, CONTRACTOR
RELATIONS BRANCH, DEPARTMENT OF THE AIR FORCE, ADVISED US THAT THE
SUBJECT RFP HAD BEEN CANCELLED PURSUANT TO DIRECTION OF AIR FORCE
LOGISTICS COMMAND, APPARENTLY ON THE BASIS OF INSUFFICIENCY OF AVAILABLE
FUNDS. SINCE THE RIGHT OF CANCELLATION IS EXPRESSLY RESERVED IN
PARAGRAPH 10 (B) OF THE STANDARD FORM 33-202 OF THE RFP, AND WE FIND NO
INDICATION THAT THE ACTION TAKEN WAS ARBITRARY OR OTHERWISE IMPROPER,
FURTHER ACTION BY OUR OFFICE IN THE MATTER WOULD NOT APPEAR TO BE
LEGALLY JUSTIFIED.
THE DEPARTMENT OF THE AIR FORCE FURTHER ADVISES THAT FUTURE
PROCUREMENT OF MEDICAL FACILITIES OF THIS TYPE WILL BE CONDUCTED BY
WRIGHT-PATTERSON AIR FORCE BASE. SINCE IT IS PRESUMED THAT YOU WILL BE
GIVEN AN OPPORTUNITY TO PARTICIPATE IN ANY FUTURE PROCUREMENT, THERE
APPEARS TO BE NO PROPER BASIS FOR FURTHER CONSIDERATION OF YOUR PROTEST
BY THIS OFFICE AT THIS TIME.
B-167578, OCT. 28, 1969
NEGOTIATION--PROPRIETY
WHERE NEGOTIATIONS WERE OPENED AFTER CONTRACTING OFFICER HAD
DETERMINED TO AWARD CONTRACT ON BASIS OF INITIAL PROPOSALS, AND PREAWARD
SURVEY OF APPARENTLY SUCCESSFUL OFFEROR HAD BEEN COMPLETED, CONTRACTING
OFFICER'S ACTION IN OPENING NEGOTIATIONS UPON RECEIVING PROPOSAL
MODIFICATION IS NOT SUBJECT TO QUESTION, SINCE ASPR 3-506 DOES NOT
PRECLUDE OPENING OF NEGOTIATIONS WITH ALL OFFERORS UPON RECEIPT OF
MODIFICATION TO OFFER WHICH WOULD PROVE ADVANTAGEOUS TO GOVT.; POSSIBLE
INFERENCE FROM PREAWARD SURVEY THAT OFFEROR'S PRICE IS NOT LOW IN
RELATION TO THAT OF ANOTHER OFFEROR AS SUCH WOULD NOT PER SE CONSTITUTE
"AUCTION TECHNIQUE" PROHIBITED BY ASPR 3-805 (B); AND NO EVIDENCE
EXISTED THAT INITIATION OF PREAWARD SURVEY RESULTED IN RELEASE OF
PROCUREMENT INFORMATION.
TO AIRMOTIVE ENGINEERING CORPORATION:
YOUR TELEGRAM DATED JULY 28, 1969, PROTESTED AGAINST THE AWARD OF A
CONTRACT TO ANY OTHER OFFEROR UNDER REQUEST FOR PROPOSALS (RFP) NO.
F41608-69-R-4804, ISSUED BY THE SAN ANTONIO AIR MATERIEL AREA, ON THE
GROUND THAT THE CONDUCT OF NEGOTIATIONS AFTER COMPLETION OF A PREAWARD
SURVEY OF YOUR FIRM WAS IMPROPER.
THE CLOSING DATE FOR SUBMISSION OF PROPOSALS UNDER THE SUBJECT RFP
WAS JUNE 4, 1969, AND BASED ON THE CONTRACTING OFFICER'S DETERMINATION
THAT THE AIRMOTIVE PRICES WERE FAIR AND REASONABLE, INITIAL PROPOSALS
WERE EVALUATED ON THE BASIS OF A POSSIBLE AWARD THEREUNDER WITHOUT
DISCUSSIONS PURSUANT TO THE ARMED SERVICES PROCUREMENT REGULATION (ASPR)
3-805.1 (A) (V) AND PARAGRAPH 10 (G) OF STANDARD FORM 33A, SOLICITATION
INSTRUCTIONS AND CONDITIONS. A PREAWARD SURVEY OF AIRMOTIVE WAS
THEREFORE REQUESTED OF THE DALLAS DEFENSE CONTRACT ADMINISTRATION
SERVICES REGION (DCASR) OFFICE ON JUNE 18, 1969, AND ON JULY 2, 1969, AN
AFFIRMATIVE PREAWARD SURVEY REPORT ON AIRMOTIVE WAS FURNISHED THE
CONTRACTING OFFICER. ON JULY 8, 1969, HOWEVER, ANOTHER OFFEROR
REQUESTED AND WAS GRANTED PERMISSION TO SUBMIT A PROPOSAL MODIFICATION.
AFTER RECEIPT OF THE REVISED OFFER, THE CONTRACTING OFFICER RELYING UPON
OUR DECISION AT 47 COMP. GEN. 279 (1967), FIXED JULY 30, 1969, AS THE
FINAL DATE FOR SUBMISSION OF PROPOSAL MODIFICATIONS AND ALL OFFERORS
WERE ADVISED OF THE OPPORTUNITY TO REEVALUATE THEIR PRICES AND DELIVERY
TERMS FOR THE PURPOSE OF SUBMITTING THEIR BEST AND FINAL OFFERS TO THE
GOVERNMENT BY JULY 30. REVISED OFFERS WERE RECEIVED FROM ALL OFFERORS
BY THAT DATE. NO AWARD HAS BEEN MADE AS YET UNDER THE RFP.
YOU MAINTAIN THAT THE INITIATION OF A PREAWARD SURVEY OF YOUR FIRM
NOT ONLY PUT OTHER OFFERORS ON NOTICE THAT YOUR FIRM WAS IN LINE FOR
AWARD, BUT THAT ONCE YOUR PROPOSAL PRICE WAS DIVULGED OUTSIDE OF THE
PROCURING ACTIVITY, I.E., TO THE DALLAS DCASR OFFICE, THERE WAS NO
GUARANTEE THAT IT DID NOT FIND ITS WAY INTO THE HANDS OF YOUR
COMPETITORS PROMPTING A PROPOSAL MODIFICATION DESIGNED TO BETTER THE
PRICES SET OUT IN YOUR PROPOSAL. YOU THEREFORE CONTEND THAT THE OPENING
OF NEGOTIATIONS AFTER A DETERMINATION TO AWARD ON THE BASIS OF INITIAL
PROPOSALS AND THE COMPLETION OF A PREAWARD SURVEY ON THE APPARENTLY
SUCCESSFUL OFFEROR "IS NOT IN LINE WITH THE INTENT OF THE LAW OR ITS
IMPLEMENTING REGULATIONS.'
47 COMP. GEN. 279 (1967), RELIED ON BY THE CONTRACTING OFFICER IN
MAKING HIS DETERMINATION THAT PROPOSAL MODIFICATIONS WERE IN ORDER
NOTWITHSTANDING THE FACT THAT A PREAWARD SURVEY REPORT ON AIRMOTIVE HAD
BEEN COMPLETED, HELD THAT THE REJECTION OF A PROPOSAL MODIFICATION
OFFERING A SIGNIFICANT PRICE REDUCTION AS LATE WHERE A PRIOR
DETERMINATION HAD BEEN MADE TO AWARD WITHOUT NEGOTIATION ON THE BASIS
THAT ADEQUATE COMPETITION EXISTED, BUT WHERE NO AWARD HAD IN FACT BEEN
MADE, WAS AN "UNSOUND EXERCISE OF DISCRETION.' THE DECISION STATED THAT:
"* * * WHILE THE PROVISIONS OF ASPR 3-506 OPERATE TO PRECLUDE, IN THE
SPECIFIED CIRCUMSTANCES, ACCEPTANCE OF A LATE OFFER OR MODIFICATION AS
SUCH, THEY DO NOT, AND WERE NEVER INTENDED TO, PRECLUDE THE OPENING-UP
OF NEGOTIATIONS WITH ALL OFFERORS COMPETITIVELY SITUATED UPON THE
RECEIPT OF A LATER MODIFICATION TO A TIMELY OFFER WHICH FAIRLY INDICATES
THAT SUCH NEGOTIATIONS WOULD PROVE TO BE HIGHLY ADVANTAGEOUS TO THE
GOVERNMENT. * * *"
SIMILARLY, A MORE RECENT CASE, 48 COMP. GEN. 323 (1968), INVOLVED A
SITUATION, SEEMINGLY IDENTICAL TO THE ONE GIVING RISE TO YOUR PROTEST,
IN WHICH NEGOTIATIONS WERE OPENED AFTER A DETERMINATION TO AWARD WITHOUT
NEGOTIATION AND THE INSTITUTION OF A PREAWARD SURVEY OF THE LOW OFFEROR.
THAT DECISION SUSTAINED THE CONDUCT OF NEGOTIATIONS NOTWITHSTANDING THE
POSSIBILITY THAT THE INITIATION OF A PREAWARD SURVEY "CAN IN A
PARTICULAR CASE GIVE RISE TO THE INFERENCE THAT AN OFFEROR'S PRICE IS
NOT LOW IN RELATION TO THAT OF ANOTHER OFFEROR" ON THE BASES THAT THE
ABOVE-MENTIONED "INFERENCE" WOULD NOT PER SE CONSTITUTE AN "AUCTION
TECHNIQUE," PROHIBITED BY ASPR 3-805.1 (B), AND THAT NO EVIDENCE EXISTED
THAT THE INITIATION OF A PREAWARD SURVEY RESULTED IN THE RELEASE OF
PROCUREMENT INFORMATION.
HOWEVER, BECAUSE BOTH OF THE ABOVE-CITED CASES POINTED UP AN
UNCERTAINTY IN THE EXISTING REGULATIONS WITH REGARD TO LATE PROPOSAL
MODIFICATIONS IN THAT THE REGULATIONS REQUIRE REJECTION OF LATE PROPOSAL
MODIFICATIONS WHILE REQUIRING AT THE SAME TIME THAT NEGOTIATIONS BE
CONDUCTED, THE MATTER WAS BROUGHT TO THE ATTENTION OF THE SECRETARY OF
DEFENSE FOR POSSIBLE CONSIDERATION BY THE ASPR COMMITTEE.
IN THE INSTANT CASE, THERE IS NO INDICATION THAT THE REQUEST FOR A
PREAWARD SURVEY OF AIRMOTIVE RESULTED IN THE DISCLOSURE OF THE AIRMOTIVE
PROPOSAL PRICES OUTSIDE OF THE GOVERNMENT. IN VIEW OF THE FACT THAT
ASPR 3-507.2 PRECLUDES THE RELEASE OF SUCH INFORMATION BEFORE THE AWARD
OF A NEGOTIATED CONTRACT, WE WOULD NOT BE JUSTIFIED IN CONCLUDING,
WITHOUT CONVINCING EVIDENCE, THAT THE REFERRAL TO DCASR FOR A PREAWARD
SURVEY RESULTED IN SUCH A DISCLOSURE. FURTHER, THE REPORT SUBMITTED TO
OUR OFFICE BY THE DEPARTMENT OF THE AIR FORCE STATES THAT THE NATURE OF
THE MODIFICATION WHICH LED TO THE OPENING OF NEGOTIATIONS WAS SUCH THAT
NO INDICATION OF "INSIDE KNOWLEDGE" EXISTED.
IN ACCORDANCE WITH THE ABOVE CONSIDERATIONS, WE MUST CONCLUDE THAT
THE ACTION OF THE CONTRACTING OFFICER IN OPENING NEGOTIATIONS UPON
RECEIPT OF A PROPOSAL MODIFICATION IS NOT SUBJECT TO QUESTION AND THAT
YOUR PROTEST MUST THEREFORE BE DENIED.
B-167910, OCT. 28, 1969
QUARTERS ALLOWANCE--CIVILIAN OVERSEAS EMPLOYEES--LOCALLY HIRED
EMPLOYEES--ELIGIBILITY
IN REPLY TO QUESTION OF AFFORDING LIVING QUARTERS ALLOWANCE TO
EMPLOYEE TOURIST HIRED LOCALLY OVERSEAS BY GUN CLUB, NONAPPROPRIATED
FUNDS AIR FORCE ACTIVITY, IN 1966 UNTIL 1967 EMPLOYMENT IN APPROPRIATED
FUNDS COMMISSARY POSITION, GAO VIEWS TOURIST BECAME UNITED STATES
EMPLOYEE IN 1966 FOR PURPOSES OF OVERSEAS DIFFERENTIALS AND ALLOWANCES
ACT, THEREFORE HE SHOULD BE TREATED AS EMPLOYEE TRANSFERRED FROM ONE
APPROPRIATED FUNDS ACTIVITY TO ANOTHER, ABSENT ANY CONTRARY REGULATION,
AND QUARTERS ALLOWANCE SHOULD HAVE BEEN CONTINUED UPON TRANSFER SINCE IT
IS ASSUMED INITIAL DETERMINATION OF ELIGIBILITY FOR QUARTERS ALLOWANCE
IN 1966 WAS PROPER.
TO FIRST LIEUTENANT WAYNE M. MCGREGOR, USAF:
YOUR MEMORANDUM OF SEPTEMBER 10, 1969, REFERENCE FCAFPC/MR. KNORR,
FORWARDED HERE BY THE CHIEF, OPERATIONS AND ADVISORY DIVISION,
DIRECTORATE OF MILITARY PAY, REFERENCE AFAACF/AFAFC-MP), REQUESTS
DECISION ON THE PROPRIETY OF A PROPOSED PAYMENT OF $841.50 TO MR.
NATHAN L. JOHNSON, REPRESENTING LIVING QUARTERS ALLOWANCE FOR THE PERIOD
JUNE 16, 1968, THROUGH JANUARY 26, 1969. ADDITIONALLY, YOU ASK FOR A
DECISION ON THE PROPRIETY OF PAST PAYMENTS IN THE AMOUNT OF $1,730.36
FOR LIVING QUARTERS ALLOWANCE FOR THE PERIOD FROM MARCH 20, 1967,
THROUGH JUNE 15, 1968.
YOU QUESTION THE LEGALITY OF THE PAYMENTS BECAUSE OF DOUBT AS TO
WHETHER MR. JOHNSON, FOR THE PERIOD INVOLVED, MET THE PERTINENT
REGULATORY REQUIREMENTS FOR ELIGIBILITY FOR QUARTERS ALLOWANCE UNDER
SECTION 031.12 OF THE STANDARDIZED REGULATIONS, PROMULGATED BY THE
DEPARTMENT OF STATE.
MR. JOHNSON, WHILE A TOURIST IN GERMANY IN FEBRUARY 1966, WAS HIRED
LOCALLY AT RAMSTEIN BY THE RAMSTEIN ROD AND GUN CLUB, AN AIR FORCE
NONAPPROPRIATED FUNDS ACTIVITY. HE WAS CONTINUOUSLY EMPLOYED BY THE
RAMSTEIN ROD AND GUN CLUB UNTIL MARCH 20, 1967, WHEN HE WAS EMPLOYED IN
AN APPROPRIATED FUNDS POSITION BY THE COMMISSARY AT THE RAMSTEIN AIR
BASE. THE FILE INDICATES THAT MR. JOHNSON WAS GRANTED A QUARTERS
ALLOWANCE WHEN EMPLOYED BY THE GUN CLUB PURSUANT TO THE PROVISIONS OF
AIR FORCE REGULATION 176-1, ISSUED UNDER EXECUTIVE ORDER 11137,
APPLICABLE TO EMPLOYEES OF NONAPPROPRIATED FUNDS ACTIVITIES. AFTER HIS
EMPLOYMENT WITH THE COMMISSARY -- APPROPRIATED FUNDS POSITION -- THE
EMPLOYEE WAS ALSO GRANTED LIVING QUARTERS ALLOWANCE ON THE BASIS OF
SECTION 031.12, PARAGRAPHS A, B, AND D, OF THE STANDARDIZED REGULATIONS.
THE LIVING QUARTERS ALLOWANCE IN THE APPROPRIATED FUNDS POSITION WAS
TERMINATED EFFECTIVE JUNE 15, 1968, ON THE BASIS OF THE FINAL DECISION
BY DPCP, HEADQUARTERS, USAFE, THAT MR. JOHNSON DID NOT MEET THE
ELIGIBILITY CRITERIA UNDER SECTION 031.12 OF THE STANDARDIZED
REGULATIONS WHEN HE WAS PLACED ON THE APPROPRIATED FUNDS ROLLS ON MARCH
20, 1967. EFFECTIVE JANUARY 27, 1969, LIVING QUARTERS ALLOWANCE WAS
AGAIN GRANTED TO MR. JOHNSON ON THE BASIS OF A WAIVER FOR HIM BY
HEADQUARTERS, UNITED STATES AIR FORCE OF SECTION 031.12C OF THE
STANDARDIZED REGULATIONS. THE DETAILS INVOLVING THE WAIVER ARE NOT PART
OF THE RECORD BEFORE US, HOWEVER, THE SUBSTANCE OF THE WAIVER, AS WE
UNDERSTAND IT, IS PREDICATED ON THE FACT THAT MR. JOHNSON AT THE TIME
OF HIS INITIAL HIRE IN THE NONAPPROPRIATED FUNDS POSITION MET THE
ELIGIBILITY REQUIREMENT CRITERIA IN SECTION 031.12 OF THE STANDARDIZED
REGULATIONS.
SECTION 031.12 OF THE STANDARDIZED REGULATIONS ISSUED BY THE
DEPARTMENT OF STATE IN RESPECT OF QUARTERS ALLOWANCE TO CITIZENS OF THE
UNITED STATES PROVIDES IN PERTINENT PART AS FOLLOWS:
"031.12 EMPLOYEES RECRUITED OUTSIDE THE UNITED STATES "QUARTERS
ALLOWANCES PRESCRIBED IN CHAPTER 100 MAY BE GRANTED TO EMPLOYEES
RECRUITED OUTSIDE THE UNITED STATES, PROVIDED THAT
"A. THE EMPLOYEE'S ACTUAL PLACE OF RESIDENCE IN THE PLACE TO WHICH
THE QUARTERS ALLOWANCE APPLIES AT THE TIME OF RECEIPT THEREOF SHALL BE
FAIRLY ATTRIBUTABLE TO HIS EMPLOYMENT BY THE UNITED STATES GOVERNMENT;
AND
"B. THE EMPLOYEE IS NOT A MEMBER OF THE HOUSEHOLD OF ANOTHER
EMPLOYEE OR OF A MEMBER OF THE U.S. ARMED FORCES; AND
"C. PRIOR TO APPOINTMENT, THE EMPLOYEE WAS RECRUITED IN THE UNITED
STATES, THE COMMONWEALTH OF PUERTO RICO, THE CANAL ZONE, OR A POSSESSION
OF THE UNITED STATES, BY
"/1) THE UNITED STATES GOVERNMENT, INCLUDING ITS ARMED FORCES;
"/2) A UNITED STATES FIRM, ORGANIZATION, OR INTEREST;
"/3) AN INTERNATIONAL ORGANIZATION IN WHICH THE UNITED STATES
GOVERNMENT PARTICIPATES; OR
"/4) A FOREIGN GOVERNMENT; AND HAD BEEN IN SUBSTANTIALLY CONTINUOUS
EMPLOYMENT BY SUCH EMPLOYER
UNDER CONDITIONS WHICH PROVIDED FOR HIS RETURN TRANSPORTATION TO THE
UNITED STATES, THE COMMONWEALTH OF PUERTO RICO, THE CANAL ZONE, OR A
POSSESSION OF THE UNITED STATES; OR
"D. THE EMPLOYEE WAS TEMPORARILY IN THE FOREIGN AREA FOR TRAVEL OR
FORMAL STUDY AND IMMEDIATELY PRIOR TO SUCH TRAVEL OR STUDY HAD RESIDED
IN THE UNITED STATES, THE COMMONWEALTH OF PUERTO RICO, THE CANAL ZONE,
OR A POSSESSION OF THE UNITED STATES; OR
"E. AS A CONDITION OF EMPLOYMENT BY A GOVERNMENT AGENCY, THE
EMPLOYEE WAS REQUIRED BY THAT AGENCY TO MOVE TO ANOTHER AREA, IN CASES
SPECIFICALLY AUTHORIZED BY THE HEAD OF AGENCY.'
EXECUTIVE ORDER 11137 DATED JANUARY 10, 1964, PROVIDES IN PART AS
FOLLOWS:
"SECTION 101. THE TERM -EMPLOYEE-, AS DEFINED IN SECTION 111 (3) OF
THE OVERSEAS DIFFERENTIALS AND ALLOWANCES ACT (5 U.S.C. 3032 (3) (, IS
HEREBY FURTHER DEFINED AS INCLUDING CIVILIAN EMPLOYEES, COMPENSATED FROM
NONAPPROPRIATED FUNDS, OF THE INSTRUMENTALITIES OF THE UNITED STATES
UNDER THE JURISDICTION OF THE ARMED FORCES COVERED BY SECTION 1 OF THE
ACT OF JUNE 19, 1952, CH. 444 (5 U.S.C. 150K).
"SEC. 102. THE SECRETARY OF EACH MILITARY DEPARTMENT WITH RESPECT TO
HIS DEPARTMENT, AND THE SECRETARY OF THE TREASURY WITH RESPECT TO THE
COAST GUARD WHEN IT IS NOT OPERATING AS A SERVICE IN THE NAVY, ARE
HEREBY DESIGNATED AND EMPOWERED TO EXERCISE, WITHOUT THE APPROVAL,
RATIFICATION, OR OTHER ACTION OF THE PRESIDENT, THE AUTHORITY VESTED IN
THE PRESIDENT BY SECTION 203 OF THE OVERSEAS DIFFERENTIALS AND
ALLOWANCES ACT (5 U.S.C. 3035) TO PRESCRIBE REGULATIONS GOVERNING
PAYMENTS OF ALLOWANCES AND DIFFERENTIALS IN FOREIGN AREAS TO THE EXTENT
THAT THE SAID AUTHORITY IS IN RESPECT OF EMPLOYEES REFERRED TO IN
SECTION 101 OF THIS ORDER WHOSE RATES OF BASIC COMPENSATION FROM
NONAPPROPRIATED FUNDS ARE FIXED IN ACCORDANCE WITH REGULATIONS
PRESCRIBED BY THE SECRETARY CONCERNED.
SEC. 103. REGULATIONS PRESCRIBED UNDER AUTHORITY DELEGATED BY THE
PROVISIONS OF SECTION 102 HEREOF:
"/A) SHALL, SO FAR AS PRACTICABLE, BE UNIFORM.
"/B) IN THE CASE OF REGULATIONS PRESCRIBED BY THE SECRETARIES OF THE
MILITARY DEPARTMENTS, SHALL REQUIRE THE APPROVAL OF THE SECRETARY OF
DEFENSE.
"/C) SHALL NOT, WITH RESPECT TO ANY LOCALITY AUTHORIZE ALLOWANCES OR
DIFFERENTIALS WHICH EXCEED THOSE PRESCRIBED UNDER EXECUTIVE ORDER NO.
10903 OF JANUARY 9, 1961, FOR OTHER EMPLOYEES OF THE UNITED STATES IN
THE SAME LOCALITY.' CERTAIN TECHNICAL AMENDMENTS TO THE ABOVE ORDER WERE
MADE BY EXECUTIVE ORDER 11382 DATED NOVEMBER 29, 1967.
UNDER THE ABOVE EXECUTIVE ORDERS EMPLOYEES OF NONAPPROPRIATED FUNDS
ACTIVITIES WERE DECLARED TO BE EMPLOYEES OF THE UNITED STATES FOR
PURPOSES OF THE OVERSEAS DIFFERENTIALS AND ALLOWANCES ACT, NOW 5 U.S.C.
5923 ET SEQ. HOWEVER, THE ALLOWANCES UNDER SUCH ACT ARE TO BE GRANTED
UNDER REGULATIONS ISSUED BY THE HEAD OF EACH MILITARY DEPARTMENT SUBJECT
TO APPROVAL BY THE SECRETARY OF DEFENSE.
THE REGULATIONS OF THE DEPARTMENT OF THE AIR FORCE PREVIOUSLY
REFERRED TO AS HAVING BEEN ISSUED IN ACCORDANCE WITH THE ABOVE AUTHORITY
(AFR 176-1) MERELY STATE THAT THE ALLOWANCES AND DIFFERENTIALS WHICH ARE
PAID TO EMPLOYEES OF NONAPPROPRIATED FUNDS ACTIVITIES SHALL NOT EXCEED
THOSE ESTABLISHED BY THE STANDARDIZED REGULATIONS OF THE STATE
DEPARTMENT FOR AMOUNTS PAID TO APPROPRIATED FUNDS EMPLOYEES OF THE
DEPARTMENT OF DEFENSE IN THE SAME LOCALITY. WHILE NOTHING IS SAID
THEREIN CONCERNING ELIGIBILITY REQUIREMENTS, WE UNDERSTAND THE LOCAL
NONAPPROPRIATED FUNDS ACTIVITY FOLLOWED THE SAME CRITERIA IN DETERMINING
ELIGIBILITY FOR QUARTERS ALLOWANCE AS SPECIFIED IN THE STANDARDIZED
REGULATIONS.
OUR VIEW IS THAT MR. JOHNSON, PURSUANT TO EXECUTIVE ORDER 11137,
BECAME AN EMPLOYEE OF THE UNITED STATES FOR PURPOSES OF THE OVERSEAS
DIFFERENTIALS AND ALLOWANCES ACT AT THE TIME OF HIS APPOINTMENT TO THE
NONAPPROPRIATED FUNDS ACTIVITY IN FEBRUARY 1966. THEREFORE, HE SHOULD
HAVE BEEN TREATED IN THE SAME MANNER AS AN EMPLOYEE TRANSFERRING FROM
ONE APPROPRIATED FUNDS ACTIVITY TO ANOTHER SO FAR AS DIFFERENTIALS AND
ALLOWANCES WERE CONCERNED IN THE ABSENCE OF ANY REGULATIONS OF THE
DEPARTMENT TO THE CONTRARY AND NONE HAS BEEN CALLED TO OUR ATTENTION.
SINCE A DETERMINATION HAD BEEN MADE AT THE TIME OF MR. JOHNSON'S
APPOINTMENT IN THE NONAPPROPRIATED FUNDS ACTIVITY THAT HE WAS ELIGIBLE
FOR A QUARTERS ALLOWANCE UNDER THE SAME CRITERIA SPECIFIED IN THE
STANDARDIZED REGULATIONS WE SEE NO REASON WHY QUARTERS ALLOWANCE SHOULD
NOT HAVE BEEN CONTINUED WHEN HE TRANSFERRED TO THE APPROPRIATED FUNDS
POSITION IN MARCH 1967. OF COURSE WE ASSUME THAT THE INITIAL
DETERMINATION OF ELIGIBILITY FOR THE QUARTERS ALLOWANCE IN FEBRUARY 1966
WAS PROPER.
IN VIEW OF THE FOREGOING THE EMPLOYEE IS ENTITLED TO RETAIN THE SUM
OF $1,730.36 WHICH HE RECEIVED AS A QUARTERS ALLOWANCE DURING THE PERIOD
MARCH 20, 1967, THROUGH JUNE 15, 1968. ALSO, THE VOUCHER FOR $841.50
REPRESENTING QUARTERS ALLOWANCE FOR THE PERIOD JUNE 16, 1968, THROUGH
JANUARY 26, 1969, RETURNED HEREWITH, MAY BE PAID IF OTHERWISE CORRECT.
B-167993(1), OCT. 28, 1969
BIDS--DISCOUNTS--CONSTRUCTION CONTRACTS
WHERE OTHERWISE LOW BIDDER CHALLENGED USE OF DISCOUNT PROVISION AND
STANDARD FORM (SF) 33 UNDER FEDERAL PROCUREMENT REGULATIONS (FPR) AND
TRADE PRACTICE AND CONTENDED COST OF USING NEW CONTRACTOR ON WORKSITE
SHOULD BE WEIGHT IN BID EVALUATION, HIS PROTEST IS DENIED AND AWARD TO
BIDDER OFFERING DISCOUNT IS PROPER, SINCE USE OF SF 33 WHICH WAS
APPROVED BY CONTRACTING OFFICER AS A PROPER EXERCISE OF DELEGATED
AUTHORITY AND MODIFIED TO INCORPORATE SUBSTANTIALLY SAME PROVISIONS
FOUND IN CONSTRUCTION CONTRACT BID FORM DOES NOT RENDER INVITATION FOR
BIDS (IFB) DEFECTIVE, REPORTED PRACTICE OF TRADE MAY NOT BE INVOKED TO
PRECLUDE CONSIDERATION OF DISCOUNT AS TRADE PRACTICE CANNOT ALTER CLEAR
TERMS OR FORCE PARTIES TO CONTRACT IN ACCORDANCE WITH CUSTOM, AND SINCE
COST TO CHANGE CONTRACTORS WAS NOT INCLUDED IN IFB IT IS NOT FOR
CONSIDERATION IN EVALUATION.
TO SELLERS, CONNER AND CUNEO:
WE REFER TO YOUR PROTEST, BY LETTERS DATED SEPTEMBER 26 AND OCTOBER
13, 1969, ON BEHALF OF AMBROSE-AUGUSTERFER CORPORATION (A-AND-A),
AGAINST AWARD TO ANY OTHER BIDDER UNDER INVITATION FOR BIDS (IFB) NO.
17, ISSUED AUGUST 25, 1969, BY THE SUPERINTENDENT, UNITED STATES MINT
(THE MINT), PHILADELPHIA, PENNSYLVANIA. THE PROCUREMENT COVERS ALL
MATERIALS AND LABOR REQUIRED FOR A COMPLETE MECHANICAL INSTALLATION AT
THE MINT OF A CLADDING MILL, A CLEANING LINE, AND A STRIP CLEANING LINE
WHICH THE MINT HAS PURCHASED.
THE BASIC BID FORM IS STANDARD FORM (SF) 33, ENTITLED SOLICITATION,
OFFER, AND AWARD, ONE OF THE FORMS PRESCRIBED BY FEDERAL PROCUREMENT
REGULATION (FPR) 1-16.101 (CITED IN THE UPPER LEFT CORNER OF SF 33) FOR
USE IN FORMALLY ADVERTISED SUPPLY CONTRACTS. BLOCK 9 OF THE FORM, AS
ADAPTED BY THE MINT FOR THE PROCUREMENT, READS, IN PERTINENT PART, AS
FOLLOWS:
"ALL OFFERS ARE SUBJECT TO THE FOLLOWING:
1. THE ATTACHED SOLICITATION INSTRUCTIONS AND CONDITIONS, SF 33A.
2. THE GENERAL PROVISIONS, SF 23A EDITION, WHICH IS ATTACHED OR
INCORPORATED HEREIN BY REFERENCE.
3. THE SCHEDULE INCLUDED BELOW AND/OR ATTACHED HERETO.
4. SUCH OTHER PROVISIONS, REPRESENTATIONS, CERTIFICATIONS, AND
SPECIFICATIONS AS ARE ATTACHED OR INCORPORATED HEREIN BY REFERENCE.
(ATTACHMENTS ARE LISTED IN THE SCHEDULE.)"
(SF 23A IS A CONSTRUCTION CONTRACT FORM.)
BENEATH THE PURCHASE DESCRIPTION ON THE FACE OF SF 33, THERE APPEARED
THE NOTATION "CONTINUED ON PAGE 3 WHICH IS PART HEREOF.' PAGE 3
CONTAINED A LIST OF ATTACHED DOCUMENTS APPLYING TO THE PROCUREMENT,
INCLUDING SF 19A, LABOR STANDARDS PROVISIONS; SF 24, BID BOND; SF 25,
PERFORMANCE OND; SF 25A, PAYMENT BOND; CERTIFICATION OF NONSEGREGATED
FACILITIES; AND APPLICABLE MINIMUM HOURLY RATES OF WAGES PRESCRIBED BY
THE DEPARTMENT OF LABOR PURSUANT TO THE DAVIS-BACON ACT, 40 U.S.C.
276A.
BLOCK 16 ON THE FACE OF SF 33 WAS ALTERED AS FOLLOWS:
"16. DISCOUNT FOR PROMPT PAYMENT
---- PERCENT 20 CALENDAR DAYS;
---- PERCENT 30 CALENDAR DAYS; ---- PERCENT ---- CALENDAR DAYS"
FOUR BIDS WERE RECEIVED, EACH ON SF 33. LAUGRO COMPANY, INC.
(LAUGRO), WITH A PRICE OF $325,000, WAS THE ONLY BIDDER WHO OFFERED A
DISCOUNT; I.E., IN BLOCK 16 LAUGRO ENTERED 1/2 OF 1 PERCENT FOR 20
CALENDAR DAYS, $1,625, OR A REDUCTION TO $323,375. THE LOWEST BID, WITH
A PRICE OF $315,000, BORE NO ENTRY IN BLOCK 16; HOWEVER, IT WAS NOT
ACCOMPANIED BY THE REQUIRED BID BOND AND WAS THEREFORE REJECTED AS
NONRESPONSIVE. A-AND-A'S BID, IN THE AMOUNT OF $324,000, SHOWED THE WORD
,NET" IN THE SPACE IN BLOCK 16 PRECEDING THE PERIOD OF 30 CALENDAR DAYS,
THEREBY INDICATING THAT PAYMENT WAS TO BE MADE WITHIN 30 DAYS AND
WITHOUT ANY DISCOUNT. THE REMAINING BID, IN THE AMOUNT OF $340,000,
SHOWED ZERO PERCENT FOR EACH OF THE THREE DISCOUNT SPACES, LIKEWISE
INDICATING THAT NO DISCOUNT WAS OFFERED.
THE SUBSTANCE OF YOUR PROTEST IS THAT DISCOUNTS ARE NOT AUTHORIZED IN
CONSTRUCTION CONTRACTS FOR TWO REASONS. FIRST, YOU CLAIM THAT THE
EXCLUSION OF CONSTRUCTION CONTRACTS FROM THE REQUIREMENTS OF FPR 1-2.201
(B) AND 1-2.407-3 (A), RELATING TO INSERTION OF DISCOUNT PROVISIONS IN
SOLICITATIONS FOR SUPPLY CONTRACTS, CONVEYS THE INTENTION THAT NO IFB'S
FOR CONSTRUCTION WORK WILL CONTAIN DISCOUNT PROVISIONS.
THE REGULATIONS READ, IN PERTINENT PART, AS FOLLOWS:
"1-2.201 PREPARATION OF INVITATIONS FOR BIDS.
(B) FOR SUPPLY AND SERVICES CONTRACTS, EXCLUDING CONSTRUCTION,
INVITATIONS FOR BIDS SHALL CONTAIN THE FOLLOWING, IN ADDITION TO THE
INFORMATION REQUIRED BY SEC. 1-2.201 (A), IF APPLICABLE TO THE
PROCUREMENT INVOLVED.
(1) DISCOUNT PROVISIONS (SEE SEC. 1-2.407-3).
"1-2.407-3 DISCOUNTS.
(A) PRIOR TO ISSUING AN INVITATION FOR BIDS (EXCEPT ONE FOR
CONSTRUCTION), A DETERMINATION SHALL BE MADE AS TO WHAT MINIMUM PERIOD
FOR PROMPT PAYMENT DISCOUNTS WILL BE CONSIDERED IN THE EVALUATION OF
BIDS AND SUCH MINIMUM PERIOD SHALL BE STATED IN THE INVITATION FOR BIDS.
* * *"
IN LIGHT OF THE REGULATIONS, WHICH YOU INTERPRET AS PRECLUDING
DISCOUNT PROVISIONS IN CONSTRUCTION CONTRACTS, AS WELL AS CONSIDERATION
OF DISCOUNTS IN THE EVALUATION OF CONSTRUCTION BIDS, YOU STATE THAT THE
USE OF BLOCK 16 ON SF 33 FOR PROMPT PAYMENT DISCOUNTS IN THIS
PROCUREMENT WAS ERRONEOUS AND UNAUTHORIZED AND THAT CONSIDERATION OF THE
LAUGRO DISCOUNT WOULD CONFER AN UNFAIR ADVANTAGE ON LAUGRO.
SECOND, YOU CLAIM THAT THE GRANTING OF PROMPT PAYMENT DISCOUNTS ON
CONSTRUCTION CONTRACTS IS IN VIOLATION OF TRADE PRACTICE AND CUSTOM;
THAT BIDDERS HAVE A RIGHT TO RELY ON TRADE PRACTICE; AND THAT THE USE
BY THE MINT OF A COMBINATION OF TWO TYPES OF FORMS, I.E., SUPPLY AND
CONSTRUCTION, CREATED A SITUATION IN WHICH BIDDERS WOULD NOT REASONABLY
EXPECT THAT DISCOUNTS WOULD BE EVALUATED IN DETERMINING THE LOW BID, A
CONCLUSION WHICH YOU CLAIM IS SUPPORTED BY THE ABSENCE OF A DISCOUNT
OFFER FROM THE THREE BIDDERS WHO COMPETED WITH LAUGRO.
IN ADDITION, YOU CLAIM THAT SINCE FPR 1-16.401 AND 1-16.402 PRESCRIBE
FORMS OTHER THAN SF 33 FOR USE IN ADVERTISED CONSTRUCTION PROCUREMENTS,
THE USE OF SF 33 WAS AN UNAUTHORIZED DEVIATION WHICH MAY OPERATE TO THE
DETRIMENT OF AN OTHERWISE LOW BIDDER, I.E., A-AND-A.
FINALLY, YOU STATE THAT A-AND-A IS PRESENTLY WORKING AT THE CONTRACT
SITE WITH ITS OWN SCAFFOLDING AND THAT AWARD TO LAUGRO AT ITS DISCOUNTED
PRICE OF $323,375 WOULD REQUIRE EITHER THE REMOVAL OF THE A-AND-A
SCAFFOLDING OR THE RENTAL THEREOF BY THE MINT FOR USE BY LAUGRO, EITHER
OF WHICH ACTIONS WILL COST THE GOVERNMENT FAR MORE THAN THE $625
DIFFERENTIAL BETWEEN A-AND-A'S BID OF $324,000 AND LAUGRO'S DISCOUNTED
BID PRICE. SUCH A FACTOR, YOU CLAIM, SHOULD BE DECISIVE OF AWARD TO
A-AND-A AS ONE OF THE "OTHER FACTORS" CONTEMPLATED BY THE PROVISIONS OF
FPR 1-2.407-1 REQUIRING AWARD TO "THAT RESPONSIBLE BIDDER WHOSE BID,
CONFORMING TO THE INVITATION FOR BIDS, WILL BE MOST ADVANTAGEOUS TO THE
GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED," PARTICULARLY SINCE THE
A-AND-A BID IS SO CLOSE AND SINCE LAUGRO BECAME THE LOW BIDDER "BY
UNFAIR ADVANTAGE.' ACCORDINGLY, YOU REQUEST THAT OUR OFFICE ADVISE THE
CONTRACTING OFFICER TO MAKE AWARD TO A-AND-A.
THE BUREAU OF THE MINT TAKES THE POSITION THAT THE CITED FPR
PROVISIONS (WHICH REQUIRE DISCOUNT PROVISIONS TO BE INCLUDED IN
ADVERTISED SUPPLY PROCUREMENT SOLICITATIONS), BY EXCLUDING CONSTRUCTION
CONTRACTS, HAVE THE EFFECT OF REMOVING CONSTRUCTION CONTRACTS FROM THE
MANDATORY ASPECT OF THE REGULATIONS. ACCORDINGLY, THE BUREAU URGES,
THERE APPEARS TO BE NO BASIS FOR CONCLUDING THAT PROCURING AGENCIES ARE
THEREBY PROHIBITED FROM OBTAINING DISCOUNTS IN CONSTRUCTION CONTRACTS
WHEN APPROPRIATE. FURTHER, THE BUREAU STATES THAT THE MINT, BY DELETING
FROM BLOCK 16 THE SPACE PROVIDED FOR ENTRY OF A DISCOUNT FOR 10 CALENDAR
DAYS, CLEARLY EXPRESSED ITS INTENTION TO CONSIDER PROMPT PAYMENT
DISCOUNTS (FOR OTHER PERIODS) IN EVALUATING BIDS FOR AWARD. IN
ADDITION, THE BUREAU ASSERTS THAT ALL BIDDERS HAD EQUAL OPPORTUNITY TO
OFFER DISCOUNTS, AND IT REPORTS THAT NO BIDDER PROTESTED AGAINST THE
DISCOUNT PROVISIONS PRIOR TO THE RECEIPT OF YOUR POST-BID OPENING
PROTEST OF SEPTEMBER 26.
FPR 1-1.009-1, PERTAINING TO DEVIATIONS FROM THE REQUIREMENTS OF THE
FEDERAL PROCUREMENT REGULATIONS, INCLUDES IN THE DEFINITION OF THE TERM
"DEVIATION" ACTIONS INVOLVING THE USE OF A FORM OTHER THAN THE STANDARD
OR OTHER FORM PRESCRIBED FOR A PROCUREMENT. FPR 1-1.009-2, RELATING TO
DEVIATIONS IN INDIVIDUAL CASES, PROVIDES FOR ADMINISTRATIVE
AUTHORIZATION IN LINE WITH THE FORMAL PROCEDURE ESTABLISHED BY THE HEAD
OF THE AGENCY AND REQUIRES THAT THE FILE IN EACH INSTANCE DISCLOSE THE
NATURE OF THE DEVIATION AND THE REASON FOR SUCH SPECIAL ACTION. SUCH
REGULATIONS ARE CONSISTENT WITH THE HOLDING IN HARTFORD ACCIDENT AND
INDEMNITY CO. V UNITED STATES, 127 F.SUPP. 565 (1955), THAT RULES AND
REGULATIONS RELATIVE TO PUBLIC CONTRACTS PROVIDING THAT A CERTAIN
STANDARD FORM SHALL BE USED FOR CONSTRUCTION CONTRACTS DO NOT PREVENT
THE GOVERNMENT FROM ENTERING INTO A CONTRACT WHICH DEVIATES FROM THE
STANDARD FORM.
WE HAVE BEEN ADVISED BY THE BUREAU OF THE MINT THAT WHILE NO WRITTEN
AUTHORIZATION APPEARS IN THE MINT'S PROCUREMENT FILE COVERING THE USE OF
SF 33 IN LIEU OF ONE OF THE CONSTRUCTION CONTRACT FORMS PRESCRIBED BY
FPR 1-16.402-3 FOR CONTRACTS ESTIMATED TO EXCEED $10,000, THE
SOLICITATION AS ISSUED HAD THE APPROVAL OF THE SUPERINTENDENT OF THE
MINT AT PHILADELPHIA, TO WHOM THE DIRECTOR OF THE MINT HAS DELEGATED
AUTHORITY TO SIGN CONTRACTS, PURCHASE ORDERS, OR OTHER DOCUMENTS
OFFICIALLY CREATING OR AUTHORIZING AN OBLIGATION. FURTHER, UNDER
REGULATIONS ISSUED BY THE DIRECTOR OF THE MINT, PURSUANT TO FPR 1-1.008,
THE SUPERINTENDENT IS A CONTRACTING OFFICER, WHO IS DEFINED BY THE
BUREAU'S REGULATIONS AS "AN OFFICIAL DESIGNATED TO ENTER INTO OR
ADMINISTER CONTRACTS AND MAKE RELATED DETERMINATIONS AND FINDINGS.' THE
DIRECTOR OF THE MINT IS ONE OF THE OFFICIALS TO WHOM AUTHORITY HAS BEEN
DELEGATED BY THE ASSISTANT SECRETARY OF THE TREASURY, UNDER TREASURY
DEPARTMENT ORDER 208, DATED MARCH 31, 1966, TO UTILIZE THE PROVISIONS OF
TITLE III OF THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF
1949, AS AMENDED, WHEN PROCURING PROPERTY AND SERVICES AND TO REDELEGATE
SUCH AUTHORITY TO ANY SUBORDINATE OFFICER OR EMPLOYEE EXCEPT FOR THE
PURPOSES OF SECTION 307 (B) OF THE ACT (WHICH RELATES TO CERTAIN
NEGOTIATED PROCUREMENTS).
IN THE CIRCUMSTANCES, AND SINCE THE VARIOUS OTHER DOCUMENTS AND
PROVISIONS INCORPORATED IN THE CONTRACT INCLUDE SUBSTANTIALLY THE SAME
PROVISIONS AS WOULD BE APPLICABLE TO THE PROCUREMENT HAD ONE OF THE
CONSTRUCTION CONTRACT BID FORMS BEEN USED FOR THE BASIC BID FORM, WE DO
NOT BELIEVE THAT THE USE OF SF 33 FOR THE BASIC BID FORM RENDERS THE IFB
DEFECTIVE SO AS TO WARRANT DISCARDING OF ALL BIDS, AFTER OPENING, AND
READVERTISEMENT OF THE PROCUREMENT NEED.
AS TO THE PROPRIETY OF INCLUDING THE DISCOUNT PROVISIONS IN THE
INSTANT IFB, WE HAVE HELD WITH RESPECT TO ARMED SERVICES PROCUREMENT
REGULATION (ASPR) 2-407.3 (THE WORDING OF WHICH IS SIMILAR TO FPR
1-2.407-3 (A) (, THAT WHILE SUCH REGULATION GIVES RECOGNITION TO THE
PRACTICE OF BIDDERS FURNISHING SUPPLIES TO OFFER PROMPT PAYMENT
DISCOUNTS AND MAKES MANDATORY THE INCLUSION OF DISCOUNT PROVISIONS IN
SUPPLY AND SERVICE CONTRACTS, THERE IS NOTHING IN THE REGULATION WHICH
PROHIBITS THE INCLUSION OF PROMPT PAYMENT DISCOUNT PROVISIONS IN AN
INVITATION FOR BIDS ON A CONSTRUCTION CONTRACT. ACCORDINGLY, WE HAVE
STATED THAT EVALUATION OF A BID OFFERING A DISCOUNT UNDER SUCH
PROVISIONS IN A CONSTRUCTION INVITATION MAY PROPERLY INCLUDE
CONSIDERATION OF THE DISCOUNT. B-158095, FEBRUARY 9, 1966. SEE, ALSO,
B-152417, OCTOBER 3, 1963.
WE HAVE ALSO HELD THAT EVEN WHEN AN INVITATION FOR BIDS ON
CONSTRUCTION WORK DOES NOT SOLICIT PROMPT PAYMENT DISCOUNTS, SUCH A
DISCOUNT MAY BE CONSIDERED IN THE EVALUATION OF A BID. 40 COMP. GEN.
518 (1961).
IN LINE WITH SUCH DECISIONS, WE CONCLUDE THAT THE INCLUSION IN THE
INSTANT IFB OF THE DISCOUNT PROVISIONS IN BLOCK 16 OF SF 33 WAS NOT
CONTRARY TO THE PROCUREMENT REGULATIONS, AND THEREFORE CONSIDERATION OF
THE DISCOUNT OFFERED BY LAUGRO LIKEWISE WOULD NOT BE CONTRARY TO THE
PROCUREMENT REGULATIONS.
AS TO THE EFFECT IN THIS CASE OF THE CUSTOM OR PRACTICE OF
CONSTRUCTION CONTRACTORS NOT TO OFFER PROMPT PAYMENT DISCOUNTS ON THE
SOLICITATION OF DISCOUNTS BY THE GOVERNMENT AND THE OFFER OF A DISCOUNT
BY LAUGRO, YOU ARE ADVISED THAT IT IS AN ESTABLISHED LEGAL PRINCIPLE
THAT A TRADE OR BUSINESS CUSTOM OR PRACTICE MAY NOT SUPERSEDE OR ALTER
THE CLEAR AND UNAMBIGUOUS TERMS OF A CONTRACT. B-122644, JUNE 27, 1955;
AFFIRMED BY B-122644, OCTOBER 4, 1955. FURTHER, PROOF OF CUSTOM OR
USAGE IS NOT FOR THE PURPOSE OF COMPELLING THE PARTIES TO CONTRACT IN
ACCORDANCE WITH USAGE, FOR THE LAW MAKES NO REQUIREMENT THAT PARTIES
SHALL USE WORDS IN ACCORDANCE WITH COMMON AND ORDINARY USAGE; NEITHER
DOES IT MAKE ANY REQUIREMENT THAT THE TERMS AND PROVISIONS OF THEIR
CONTRACTS SHALL BE THE SAME AS, OR EVEN SIMILAR TO, THOSE THAT THEIR
NEIGHBORS OR TRADE ASSOCIATES ARE ACCUSTOMED TO AGREE UPON. CORBIN ON
CONTRACTS, SEC. 565, INTERPRETATION.
CONSISTENT WITH SUCH PRINCIPLES, IT IS OUR VIEW THAT IN LIGHT OF THE
CLEAR SOLICITATION BY THE GOVERNMENT IN THE IFB OF PROMPT PAYMENT
DISCOUNTS FOR PERIODS OF 20, 30 OR MORE CALENDAR DAYS AND OF LAUGRO'S
UNEQUIVOCAL OFFER IN ITS BID OF A 20-DAY DISCOUNT, THE REPORTED PRACTICE
OF THE TRADE MAY NOT BE INVOKED TO PRECLUDE CONSIDERATION OF THE
DISCOUNT IN THE EVALUATION OF LAUGRO'S BID. NOR DO WE CONSIDER THAT OUR
CONCLUSION IN THIS REGARD GIVES LAUGRO AN UNFAIR ADVANTAGE, AS YOU
CLAIM, OVER YOU, FOR YOU AND THE OTHER BIDDERS WERE AT LIBERTY TO OBJECT
TO THE DISCOUNT PROVISIONS, OR ANY OTHER PROVISIONS OF THE IFB, BEFORE
BID OPENING, AS CAUTIONED BY PARAGRAPH 3 OF SF 33A, BUT DID NOT DO SO.
AS TO YOUR CONTENTION THAT IN MAKING AWARD THE MINT SHOULD CONSIDER
THE COST OF USING A NEW CONTRACTOR AS OPPOSED TO USING YOU SINCE YOU ARE
ALREADY AT THE WORK SITE, IT IS A CARDINAL RULE OF COMPETITIVE BIDDING
PROCEDURES THAT THE INVITATION FOR BIDS SHOULD ADVISE BIDDERS OF ANY
FACTOR OTHER THAN BID PRICE WHICH IS TO BE CONSIDERED IN DETERMINING THE
LOW BIDDER. ACCORDINGLY, THERE BEING NO MENTION OF SUCH FACTOR IN THE
IFB, IT MAY NOT BE CONSIDERED IN THE EVALUATION OF THE BIDS SO AS TO
DEPRIVE LAUGRO, THE LOWEST BIDDER, OF AWARD. 45 COMP. GEN. 433, 435
(1966) AND DECISIONS THEREIN CITED.
B-167993(2), OCT. 28, 1969
FORMS--DEVIATIONS--CONSTRUCTION CONTRACTS
ALTHOUGH DECISION UPHOLDS VALIDITY OF INVITATION ISSUED BY
SUPERINTENDENT OF U. S. MINT, PHILADELPHIA, PA; FOR WHICH A SUPPLY
CONTRACT FORM WAS ISSUED IN LIEU OF CONSTRUCTION CONTRACT FORM
PRESCRIBED BY FEDERAL PROCUREMENT REGULATIONS (FPR) 1-16.402-3, DIRECTOR
OF MINT IS ADVISED DEVIATIONS FROM REQUIREMENTS OF FPR SHOULD BE
RECORDED IN INDIVIDUAL CASES IN THE PROCUREMENT FILE TOGETHER WITH
REASON FOR SUCH SPECIAL ACTION.
TO MRS. BROOKS:
ENCLOSED IS A COPY OF OUR DECISION OF TODAY TO THE LAW FIRM OF
SELLERS, CONNER AND CUNEO, DENYING THEIR PROTEST ON BEHALF OF
AMBROSE-AUGUSTERFER CORPORATION AGAINST AWARD TO ANY OTHER BIDDER UNDER
INVITATION FOR BIDS NO. 17, ISSUED AUGUST 25, 1969, BY THE
SUPERINTENDENT OF THE UNITED STATES MINT, PHILADELPHIA, PENNSYLVANIA.
THE PROCUREMENT INVOLVES MECHANICAL INSTALLATION AT THE MINT OF A
CLADDING MILL, A CLEANING LINE, AND A STRIP CLEANING LINE WHICH THE MINT
HAS ALREADY PURCHASED.
ALTHOUGH OUR DECISION UPHOLDS THE VALIDITY OF THE INVITATION, FOR
WHICH A SUPPLY CONTRACT FORM WAS USED IN LIEU OF ONE OF THE CONSTRUCTION
CONTRACT FORMS PRESCRIBED BY FEDERAL PROCUREMENT REGULATION (FPR)
1-16.402-3, YOUR ATTENTION IS DIRECTED TO THE FACT THAT DEVIATIONS OF
THIS NATURE FROM THE REQUIREMENTS OF THE FPR SHOULD BE RECORDED IN
INDIVIDUAL CASES IN THE PROCUREMENT FILE TOGETHER WITH THE REASON FOR
SUCH SPECIAL ACTION. SEE FPR 1-1.009-2 (B).
THE MATTER WAS THE SUBJECT OF A REPORT BY LETTER DATED OCTOBER 2,
1969, FROM THE ACTING DIRECTOR OF THE MINT. THE FILE FORWARDED WITH THE
LETTER IS RETURNED.
B-168057, OCT. 28, 1969
MISTAKES--ALLEGATION AFTER AWARD--CONTRACTING OFFICER'S ERROR DETECTION
DUTY--PRICE COMPARISON WITH PRIOR PROCUREMENTS
AFTER AWARD OF CONTRACT TO SUPPLY DIESEL FUEL OIL, REQUESTED PRICE
INCREASE TO EQUAL COST, DELIVERY, MARGIN AND OVERHEAD FROM ALLEGED
ERRONEOUS QUOTATION WHICH WAS 18 PERCENT BELOW PRIOR CONTRACT PRICE AS
WELL AS NEXT LOW PRICE QUOTED UNDER REQUEST FOR PROPOSALS, MAY BE
GRANTED AS RECOMMENDED BY CONTRACTING OFFICER WHICH EXCLUDES OVERHEAD
AND MARGIN, SINCE CONTRACTING OFFICER SHOULD NOT HAVE ASSUMED THAT
DIFFERENCE IN PRICE WAS DUE TO UNDERCUTTING TO OBTAIN CONTRACT OR
ACCEPTED QUOTED PRICE WITHOUT VERIFICATION.
TO MR. SHAKESPEARE:
REFERENCE IS MADE TO LETTER DATED OCTOBER 3, 1969, FROM THE DEPUTY
GENERAL COUNSEL, REQUESTING A DECISION AS TO WHETHER CONTRACT NO.
IA-35-199, DATED JUNE 27, 1969, MAY BE AMENDED TO INCREASE THE PRICE
SPECIFIED FOR DIESEL FUEL OIL.
REQUEST FOR PROPOSALS NO. 2 WAS ISSUED BY THE AMERICAN CONSULATE
GENERAL, TANGIER, MOROCCO, ON MAY 21, 1969, REQUESTING PROPOSALS FOR
FURNISHING CLEAN DIESEL FUEL OIL TYPE 2D (AMERICAN SOCIETY FOR TESTING
MATERIALS (ASTM) ( TO THE VOICE OF AMERICA (VOA), TANGIER RELAY STATION.
FOUR PROPOSALS WERE RECEIVED AS FOLLOWS:
COMPANY PROPOSED PRICE
------- --------------
TEXACO DH .3515 PER LITER OR $0.2619 PER GALLON
ATLAS DH .4120 PER LITER OR 0.30697 PER GALLON
MOBIL DH .4200 PER LITER OR 0.31293 PER GALLON
SHELL DH .4245 PER LITER OR 0.31629 PER GALLON THE CONTRACT W
AFTER RECEIVING THE AWARD TEXACO ALLEGED THAT IT HAD ERRONEOUSLY QUOTED
ITS PRICE FOR A 35-PERCENT RESIDUAL FUEL OIL/65-PERCENT DISTILLATE GAS
OIL INSTEAD OF ITS PRICE FOR A 2D (ASTM) DIESEL FUEL OIL AS REQUESTED IN
THE REQUEST FOR PROPOSALS. BY WAY OF PARTIAL RELIEF, TEXACO HAS
REQUESTED THAT THE CONTRACT PRICE BE INCREASED TO DH 40.8241 PER
HECTOLITER TO COVER THE TOTAL COST OF THE FUEL TO TEXACO PLUS DELIVERY
CHARGES, OVERHEAD AND MARGIN. HOWEVER, THE CONTRACTING OFFICER HAS
RECOMMENDED THAT THE PRICE BE INCREASED TO DH 37.0320 PER HECTOLITER
WHICH EXCLUDES OVERHEAD AND MARGIN. IF MODIFICATION OF THE CONTRACT IS
AUTHORIZED AS RECOMMENDED, THE CONTRACT PRICE WOULD STILL BE LOWER THAN
ALL OTHER PRICES QUOTED. IN ADDITION, IT IS REPORTED THAT PRICES QUOTED
FOR THE SUPPLY OF THE SAME TYPE FUEL OIL TO THE VOA TANGIER RELAY
STATION DURING THE PREVIOUS CONTRACT YEAR WERE DH .4120 PER LITER AND DH
.4245 PER LITER.
THE CONTRACTING OFFICER, WHILE RECOMMENDING THAT THE CONTRACTOR BE
GRANTED THE RELIEF, STATES THAT HE WAS NOT ON CONSTRUCTIVE NOTICE OF THE
POSSIBILITY OF AN ERROR SINCE THE SPECIFICATIONS WERE CLEAR AND
UNAMBIGUOUS AND TEXACO HAS PREVIOUSLY EXPRESSED A STRONG DESIRE TO
BECOME A SUPPLIER AND THAT PRICE UNDERCUTTING IN THE OIL BUSINESS IS
COMMON PRACTICE. THE DEPUTY GENERAL COUNSEL ALSO STATES THAT HE DOES
NOT BELIEVE THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF
THE PROBABILITY OF THE MISTAKE.
THE GENERAL RULE IS THAT, WHERE A MISTAKE HAS BEEN ALLEGED AFTER
AWARD, RELIEF WILL BE GRANTED ONLY IF THE MISTAKE WAS MUTUAL OR THE
CONTRACTING OFFICER KNEW, OR SHOULD HAVE KNOWN, OF THE ERROR PRIOR TO
AWARD. IN THE INSTANT CASE, WHILE IT MAY BE THAT UNDERCUTTING THE
ESTABLISHED PRICES IN ORDER TO GET BUSINESS IS NOT UNCOMMON, IN VIEW OF
THE NATURE OF THE COMMODITY AND THE SMALL QUANTITY OF FUEL OIL INVOLVED
WE HAVE DOUBTS THAT THE CONTRACTING OFFICER SHOULD HAVE ASSUMED THAT A
PRICE OF $0.045 PER GALLON LESS THAN THE SECOND LOW BID WAS DUE TO
UNDERCUTTING IN ORDER TO OBTAIN A CONTRACT. SINCE THE PRICE QUOTED BY
TEXACO WAS 18 PERCENT BELOW THE PRIOR CONTRACT PRICE AS WELL AS THE NEXT
LOW PRICE QUOTED UNDER THE INSTANT REQUEST FOR PROPOSALS, WE THINK THE
CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF
ERROR IN THE QUOTATION OF THE CONTRACTOR AND, CONSEQUENTLY, THE PRICE
QUOTED SHOULD NOT HAVE BEEN ACCEPTED WITHOUT FIRST REQUIRING
VERIFICATION THEREOF. SEE B-165934, FEBRUARY 3, 1969, AND CASES CITED
THEREIN.
ACCORDINGLY, THE CONTRACT MAY BE MODIFIED AS RECOMMENDED BY THE
CONTRACTING OFFICER.
B-153784, OCT. 27, 1969
PAY--RETIRED--RATE AT TIME OF RETIREMENT--MANDATORY RETIREMENT
EXTENDED--PHYSICAL EVALUATION
WHERE AIR FORCE OFFICER'S MANDATORY RETIREMENT DATE WAS JUNE 2, 1969,
HE WAS TO HAVE BEEN RETAINED ON ACTIVE DUTY THROUGH JUNE 30, 1969, BY
VIRTUE OF 5 U.S.C. 8301 (A) AND RETIRED EFFECTIVE JULY 1, 1969, BUT WAS
RETAINED UNTIL JULY 31, 1969 DUE TO PENDING PHYSICAL EVALUATION,
RETIREMENT ORDERS OF JULY 15, 1969 FIXED RETIREMENT DATE AS AUG. 1,
1969, AND BASIC PAY RATES WERE INCREASED EFFECTIVE JULY 1, 1969, RETIRED
PAY ENTITLEMENT BECAME FIXED UNDER 5 U.S.C. 8301 (B) ON PAY SCALE
APPLICABLE JUNE 2, 1969 EVEN THOUGH HE CONTINUED ON ACTIVE DUTY UNTIL
JULY 31, 1969 SINCE OFFICER WAS REQUIRED TO BE INVOLUNTARILY RETIRED
JUNE 2, 1969 UNDER 10 U.S.C. 8916 AND WHILE 5 U.S.C. 8301 PERMITTED HIM
TO REMAIN ON ACTIVE DUTY UNTIL JUNE 30, 1969 AND FIXED EFFECTIVE DATE OF
RETIREMENT JULY 1, 1969, IT REQUIRED HIS RETIRED PAY BE COMPUTED ON
BASIS OF RATES OF ACTIVE DUTY PAY EFFECTIVE JUNE 2, 1969.
TO MAJOR N. C. ALCOCK, USAF:
FURTHER REFERENCE IS MADE TO YOUR LETTER (FILE REFERENCE ALRA)
REQUESTING AN ADVANCE DECISION AS TO THE PROPRIETY OF MAKING PAYMENT ON
A VOUCHER IN THE AMOUNT OF $82.24 IN FAVOR OF LIEUTENANT COLONEL GARLAND
M. JONES, USAF, RETIRED, REPRESENTING THE DIFFERENCE IN RETIRED PAY FOR
THE PERIOD AUGUST 1-31, 1969, COMPUTED ON THE APPLICABLE RATE OF THE
JULY 1, 1968, BASIC PAY SCALE AND THE APPLICABLE RATE OF THE SCALE IN
EFFECT ON JULY 1, 1969. YOUR LETTER WAS FORWARDED TO THIS OFFICE BY
LETTER FROM THE OFFICE OF THE DEPUTY COMPTROLLER FOR ACCOUNTING AND
FINANCE OF THE AIR FORCE DATED SEPTEMBER 19, 1969, AND HAS BEEN ASSIGNED
AIR FORCE REQUEST NO. DO-AF-1051 BY THE DEPARTMENT OF DEFENSE MILITARY
PAY AND ALLOWANCE COMMITTEE.
YOU STATE THAT COLONEL JONES' MANDATORY RETIREMENT DATE UNDER THE
PROVISIONS OF 10 U.S.C. 8916 WAS JUNE 2, 1969; THAT HE WAS TO HAVE BEEN
RETAINED ON ACTIVE DUTY THROUGH JUNE 30, 1969, BY VIRTUE OF 5 U.S.C.
8301 (A), AND RETIRED EFFECTIVE JULY 1, 1969; BUT THAT HE WAS RETAINED
ON ACTIVE DUTY UNTIL JULY 31, 1969, DUE TO A PENDING PHYSICAL
EVALUATION. NO DISABLING CONDITION WAS FOUND. HIS RETIREMENT ORDERS OF
JULY 15, 1969, FIX HIS DATE OF RETIREMENT AS AUGUST 1, 1969.
THE BASIC PAY RATES WERE INCREASED EFFECTIVE JULY 1, 1969. SINCE
COLONEL JONES CONTINUED ON ACTIVE DUTY UNTIL JULY 31, 1969, THE QUESTION
IS PRESENTED WHETHER HIS RETIRED PAY ENTITLEMENT BECAME FIXED UNDER 5
U.S.C. 8301 (B) ON THE PAY SCALE APPLICABLE ON JUNE 2, 1969, OR WHETHER
SUCH RETIRED PAY SHOULD BE BASED ON THE PAY SCALE APPLICABLE ON JULY 1,
1969.
ADDITIONALLY, YOU ASK WHETHER THE LANGUAGE USED IN 43 COMP. GEN. 742
(1964), THAT "THE FACT THAT THE ARMY FAILED TO ACCOMPLISH HIS RETIREMENT
ON THE DATE REQUIRED BY LAW WOULD NOT SEEM TO ADD TO HIS RIGHTS IN ANY
WAY WITH RESPECT TO COMPUTING THE AMOUNT OF RETIRED PAY TO WHICH HE IS
ENTITLED," PRECLUDES ANY INCREASE IN RETIRED PAY INCLUDING AN INCREASE
WHICH MIGHT OCCUR AS A RESULT OF AN INCREASE IN THE STATUTORY BASIC PAY
RATE.
SECTION 8916 OF TITLE 10, U.S. CODE, PROVIDES IN PERTINENT PART THAT:
"/A) UNLESS RETIRED OR SEPARATED AT AN EARLIER DATE, EACH
PROMOTION-LIST OFFICER IN THE REGULAR GRADE OF LIEUTENANT COLONEL SHALL
BE RETIRED, EXCEPT AS PROVIDED BY SECTION 8301 OF TITLE 5, ON THE
THIRTIETH DAY AFTER HE COMPLETES 28 YEARS OF SERVICE COMPUTED UNDER 8927
(A) OF THIS TITLE * * *"
THE UNIFORM RETIREMENT DATE ACT AS CODIFIED IN 5 U.S.C. 8301 REQUIRES
THAT EVERY RETIREMENT (UNLESS OTHERWISE SPECIFICALLY PROVIDED BY
STATUTE) TAKES EFFECT ON THE FIRST DAY OF THE MONTH FOLLOWING THE MONTH
IN WHICH THE RETIREMENT WOULD OTHERWISE BE EFFECTIVE, BUT THAT THE RATE
OF RETIRED PAY MUST BE COMPUTED AS OF THE DATE RETIREMENT WOULD HAVE
OCCURRED IF THAT ACT HAD NOT BEEN ENACTED. IT IS EVIDENT THAT COLONEL
JONES WAS REQUIRED TO BE INVOLUNTARILY RETIRED ON JUNE 2, 1969, UNDER 10
U.S.C. 8916, AND THAT WHILE 5 U.S.C. 8301 PERMITTED HIM TO REMAIN ON
ACTIVE DUTY UNTIL JUNE 30, 1969, AND FIXED THE EFFECTIVE DATE OF HIS
RETIREMENT AS JULY 1, 1969, IT REQUIRED THAT HIS RETIRED PAY BE COMPUTED
ON THE BASIS OF THE RATES OF ACTIVE DUTY PAY THAT WERE EFFECTIVE ON JUNE
2, 1969.
YOU HAVE SUGGESTED NO PROVISION OF LAW UNDER WHICH THE MANDATORY
REQUIREMENTS OF 10 U.S.C. 8916 AND 5 U.S.C. 8301 MAY BE DISREGARDED AND
WE KNOW OF NO SUCH PROVISION. HENCE, HIS RETIRED PAY SHOULD BE COMPUTED
ON THE BASIS OF THE PAY SCALE THAT BECAME EFFECTIVE JULY 1, 1968. YOUR
QUESTIONS ARE ANSWERED ACCORDINGLY. SEE IN THIS CONNECTION OUR DECISION
TO YOU DATED SEPTEMBER 17, 1969, B-153784, IN WHICH THERE WAS CONSIDERED
A SITUATION SIMILAR TO THAT HERE INVOLVED.
B-165953, OCT. 27, 1969
SPECIFICATIONS--DEFECTIVE--CONTRACTOR V GOVERNMENT RESPONSIBILITY
UNDER REQUEST FOR PROPOSALS FOR AIR CONDITION UNITS, UNSUCCESSFUL
OFFEROR'S ALLEGATION THAT SPECIFICATION CLAUSE CALLING FOR CONTRACTOR TO
CORRECT ALL DISCREPANCIES, OR DEFICIENCIES IN PRODUCT SPECIFICATIONS OR
TECHNICAL DATA AT NO COST INCREASE OR DELAY IN DELIVERY IS UNREASONABLE
AND UNFAIR, DOES NOT JUSTIFY DISTURBING AWARD TO LOW OFFEROR, SINCE
CLAUSE IS ATTEMPT TO ASSIGN RISK OF DEFECTIVE SPECIFICATIONS TO
CONTRACTOR, AND PREVENT LITIGATION WHICH HAS RESULTED IN PAST; HOWEVER,
CONTRACTOR SHOULD NOT BE EXPECTED TO ASSUME UNREASONABLE RISKS, AND IF
CORRECTION OF DEFECT IS SUBSTANTIALLY MORE THAN CONTEMPLATED, IT COULD
BE ARGUED THAT CORRECTION OF DEFICIENCIES CLAUSE DOES NOT BAR AN
EQUITABLE ADJUSTMENT.
TO AMERICAN AIR FILTER COMPANY, INCORPORATED:
WE REFER TO YOUR LETTER OF JULY 1, 1969, AND PRIOR CORRESPONDENCE,
PROTESTING THE PROVISIONS OF ARTICLE 1, PARAGRAPH C, OF REQUEST FOR
PROPOSALS NO. DAAK01-69-R-4062, ISSUED BY THE UNITED STATES ARMY
MOBILITY EQUIPMENT COMMAND, AT ST. LOUIS, MISSOURI, FOR AIR CONDITION
UNITS.
ARTICLE 1 OF THE RFP ENTITLED "PREPRODUCTION AND PRODUCTION
EVALUATION OF TECHNICAL DATA" CALLS UPON THE CONTRACTOR TO CORRECT ALL
DISCREPANCIES, ERRORS OR DEFICIENCIES IN THE PRODUCT SPECIFICATIONS OR
TECHNICAL DATA WITHOUT INCREASE IN CONTRACT PRICE OR DELAY IN DELIVERY.
THIS CLAUSE WAS CONSIDERED BY OUR OFFICE IN B-165953, DATED MAY 23,
1969, IN CONNECTION WITH A PROTEST FILED BY ANOTHER FIRM UNDER THE
SUBJECT RFP. (A COPY OF THIS DECISION WAS FURNISHED TO YOUR FIRM ON
JUNE 2, 1969.) WE HELD THAT OUR OFFICE HAD NO BASIS TO OBJECT TO THE
INCLUSION OF ARTICLE 1 IN THE RFP AND RESULTING CONTRACT. FOLLOWING OUR
DECISION, A CONTRACT WAS AWARDED ON JUNE 11, 1969, TO THE TRANE COMPANY
AS THE LOW OFFEROR ON THE RFP. YOU NOW RAISE CERTAIN ISSUES WHICH WERE
NOT SPECIFICALLY DISCUSSED IN OUR PRIOR DECISION.
YOU QUESTION WHETHER IT IS REASONABLE OR FAIR TO EXPECT A CONTRACTOR
TO BE RESPONSIBLE FOR CORRECTING LATENT DEFECTS IN SPECIFICATIONS
PROVIDED BY THE GOVERNMENT. AS AN EXAMPLE, YOU CITE A CASE WHERE ONE OF
THE SPECIFIED SINGLE-SOURCE COMPONENTS (YOU SAY IT COULD BE THE
COMPRESSOR, FAN MOTOR, EVAPORATOR FAN OR CONDENSOR FAN) DOES NOT OR WILL
NOT PERMIT THE UNIT TO MEET THE PERFORMANCE SPECIFICATION. YOU STATE
THAT EVEN IF THE CONTRACTOR DETERMINES INITIALLY THAT THE SPECIFIED
COMPONENT IS INADEQUATE, AND HE SELECTS ANOTHER COMPONENT, THE
CONTRACTING OFFICER FOR VARIOUS REASONS MIGHT CALL FOR A REDESIGN OF THE
UNIT WITH THE ORIGINALLY SELECTED COMPONENT RATHER THAN APPROVE THE NEW
COMPONENT SELECTED BY THE CONTRACTOR; BUT THAT IN EITHER CASE THE
CONTRACTOR MUST ABSORB THE COSTS. THUS, YOU CONCLUDE THAT UNDER THIS
CLAUSE A CONTRACTOR COULD BE REQUIRED TO PERFORM MAJOR REDESIGNING TO
CORRECT LATENT DEFECTS IN GOVERNMENT-FURNISHED SPECIFICATIONS, WITHOUT
RECEIVING ANY INCREASE IN PRICE. YOU PROTEST SUCH A PROVISION, AND
REQUEST A RECONSIDERATION OF THE CONTRACT AWARD AND ELIMINATION OF THE
PROVISION IN QUESTION BEFORE A NEW AWARD IS MADE.
THE DEPARTMENT OF THE ARMY CONFIRMS THAT THERE ARE SOURCE-CONTROLLED
ITEMS SPECIFIED IN THE SUBJECT SOLICITATION. IT CONSIDERS THIS TO BE
ADVANTAGEOUS TO BOTH THE GOVERNMENT AND THE CONTRACTOR BECAUSE IT MEANS
THAT THE COMPONENTS HAVE BEEN TESTED AS MEETING THE SPECIFICATIONS.
ALSO THE DEPARTMENT RECOGNIZES THAT SHOULD THE CONTRACTOR QUESTION THE
ADEQUACY OF A SOURCE-CONTROLLED ITEM, HE MAY RUN HIS OWN TEST AND SUBMIT
AN ENGINEERING CHANGE PROPOSAL (ECP) AS PROVIDED IN THE CLAUSE.
LEGAL COUNSEL FOR THE DEPARTMENT OF THE ARMY STATES THAT IF A
SPECIFIED COMPONENT'S DESIGN IS FOUND TO BE INADEQUATE (WHICH HE DOUBTS
WILL BE THE CASE IN VIEW OF THE TESTING), HE BELIEVES IT IS NOT UNFAIR
TO PLACE THE BURDEN OF RESPONSIBILITY UPON THE CONTRACTOR FOR ANY
REDESIGNING WHICH MAY BE NECESSARY. HE FURTHER STATES THAT IN THE
HYPOTHETICAL SITUATION YOU POSE WHERE THE GOVERNMENT UNREASONABLY
REFUSES TO APPROVE A ALTERNATE PROPOSED BY ECP TO CORRECT THE INADEQUATE
DESIGN OF A SPECIFIED COMPONENT, A CONTRACTOR COULD TREAT SUCH A REFUSAL
AS A CONSTRUCTIVE CHANGE TO THE CONTRACT AND MIGHT RECEIVE AN EQUITABLE
ADJUSTMENT FOR THE ADDITIONAL EXPENSE INCURRED. COUNSEL CITES APPEAL OF
BARKSDALE BROTHERS CORPORATION, ASBCA NO. 7214, WHERE THE PRECLUSION OF
A CONTRACTOR'S FREEDOM OF CHOICE WAS HELD TO DISCHARGE ITS OBLIGATIONS,
AND APPEAL OF NOONAN CONSTRUCTION COMPANY, ASBCA NO. 8320, WHICH
RECOGNIZED THAT "GOVERNMENT REPRESENTATIVES, AS WELL AS CONTRACTORS,
MUST, WITHIN THE CONFINES OF CONTRACTUAL OBLIGATIONS, ALWAYS ACT AS
REASONABLE MEN WOULD UNDER THE SAME CIRCUMSTANCES," AS SUPPORTING SUCH A
RESULT.
IT APPEARS TO US THAT ARMY COUNSEL RECOGNIZES THE NEED TO INTERPRET
ARTICLE 1 IN A REASONABLE MANNER. BUT HE BELIEVES THAT IT IS FAIR TO
PLACE THE BURDEN OF CORRECTING DEFECTIVE SPECIFICATIONS UPON THE
CONTRACTOR AND NOT THE GOVERNMENT. EXTENSIVE LITIGATION HAS RESULTED IN
THE PAST BECAUSE OF DEFECTIVE SPECIFICATIONS. THE CURRENT CLAUSE IS AN
ATTEMPT SPECIFICALLY TO ASSIGN THE RISK OF DEFECTIVE SPECIFICATIONS TO
THE CONTRACTOR. HOWEVER, WE DO NOT BELIEVE THAT THE CONTRACTOR SHOULD
BE EXPECTED TO ASSUME AN UNREASONABLE RISK. IF, FOR EXAMPLE, THE AMOUNT
OF REDESIGNING NECESSARY TO CORRECT A DEFECT IS SUBSTANTIALLY GREATER
THAN COULD REASONABLY HAVE BEEN CONTEMPLATED AT THE TIME OF BIDDING, IT
COULD WELL BE ARGUED, WE THINK, THAT THE CORRECTION OF DEFICIENCIES
CLAUSE DOES NOT BAR AN EQUITABLE ADJUSTMENT IN SUCH A CASE.
IN ANY CASE, WE DO NOT INTEND TO DISTURB THE IMMEDIATE AWARD. AS
INDICATED IN OUR PRIOR DECISION, ONLY EXPERIENCE WILL REVEAL WHETHER THE
USE OF THE CLAUSE IN QUESTION IS WARRANTED FOR PURPOSES OF GOVERNMENT
PROCUREMENT. YOUR PROTEST AGAINST THE AWARD AND THE USE OF THIS CLAUSE
IS THEREFORE DENIED.
B-167623, OCT. 27, 1969
NEGOTIATION--STANDARDIZATION AND INTERCHANGEABILITY DETERMINATION
EXCLUSION FROM PROCUREMENT OF PROTESTANT WHO ASSERTS PROVEN
CAPABILITY IN REPAIR PROCEDURES REQUIRED BY AIR FORCE (AF) TO SERVICE
CRITICAL PARTS (JET ENGINE DISCS), AND OBJECTS TO PROCUREMENT POLICY
WHICH DIRECTED PROPOSALS THEREFORE BE RESTRICTED TO ENGINE MANUFACTURER
AND SOURCES APPROVED BY SAME OR WHOSE PROCEDURES WERE PROVEN SUCCESSFUL
IN FIELD OPERATION, CANNOT BE HELD IMPROPER SINCE AF POLICY, FOR REASONS
OF FLIGHT SAFETY, OF CONSULTING MANUFACTURER FOR RECOMMENDATIONS ON
COMPLETE AND ADEQUACY OF NEW REPAIR PROCEDURES WHICH ARE DEVELOPED BY
FIRMS OTHER THAN MANUFACTURER OF CRITICAL PARTS APPEARS TO ACCORD WITH
ARMED SERVICES PROCUREMENT REGULATION 1-313 (C), AT LEAST WHILE FULLY
ADEQUATE DATA, TEST RESULTS AND QUALITY ASSURANCE PROCEDURES ARE NOT
AVAILABLE WITH RIGHT OF USE FOR PROCUREMENT PURPOSES.
TO VEMCO PLATING CO., INC.:
REFERENCE IS MADE TO YOUR LETTER OF JULY 28, 1969, CONCERNING YOUR
PROTEST UNDER REQUEST FOR PROPOSAL (RFP) F41608-70-R-6037, WHICH WAS
ISSUED ON AUGUST 22, 1969, BY THE DIRECTORATE OF PROCUREMENT AND
PRODUCTION, SAN ANTONIO AIR MATERIEL AREA (SAAMA), KELLY AIR FORCE BASE,
TEXAS, TO OBTAIN ALL PLANT, LABOR AND EQUIPMENT NECESSARY FOR THE REPAIR
OF AN ESTIMATED QUANTITY OF 6,500 J57, J75 AND T33 JET ENGINE COMPRESSOR
ROTOR DISCS. SINCE THE DISCS ARE CLASSED AS CRITICAL PARTS AND AFFECT
THE SAFETY OF THE AIRCRAFT IN QUESTION, AIR FORCE PROCUREMENT POLICY
DIRECTED THAT PROPOSALS FOR THE WORK BE SOUGHT FROM THE ENGINE
MANUFACTURER, PRATT AND WHITNEY AIRCRAFT DIVISION, UNITED AIRCRAFT
CORPORATION (P-AND-W), AND SIX OTHER CONCERNS WHOSE REPAIR TECHNIQUES
HAD BEEN APPROVED BY P-AND-W OR HAD PROVEN SUCCESSFUL IN FIELD
OPERATION.
YOU MAINTAIN THAT YOUR CONCERN HAS DEMONSTRATED ITS ABILITY TO
ACCOMPLISH THE MOST DIFFICULT PART OF THIS REPAIR WORK WHICH IS RELATED
TO THE "PLATING" OF THESE ITEMS AND SHOULD HAVE BEEN ALLOWED TO SUBMIT A
PROPOSAL UNDER THE RFP. TO SUPPORT YOUR CONTENTION YOU HAVE FURNISHED
US WITH COPIES OF METALLURGICAL REPORTS PREPARED BY THE OKLAHOMA CITY
AIR MATERIEL AREA (OCAMA), TINKER AIR FORCE BASE, INDICATING THAT YOUR
NICKEL PLATING PROCESS HAS RECEIVED THE APPROVAL OF THAT FACILITY. YOU
ALSO STATED THAT SAMPLES OF YOUR PROCESS WERE SUBMITTED TO SAAMA FOR
EXAMINATION AND APPROVAL.
THE REPORT OF THE AIR FORCE ON YOUR PROTEST ADVISES THAT IT HAS
DETERMINED THAT WHEN A NEW REPAIR PROCEDURE FOR A CRITICAL PART IS
DEVELOPED BY A COMMERCIAL FIRM OTHER THAN THE ENGINE MANUFACTURER, AIR
FORCE POLICY WILL BE TO CONSULT WITH THE ENGINE MANUFACTURER AS TO ITS
RECOMMENDATIONS ON THE COMPLETENESS AND ADEQUACY OF THE REPAIR PROCEDURE
INCLUDING THE EXTENT AND NATURE OF QUALIFICATION AND INTERFACE TESTING
(TEST CELL AND FLIGHT TESTING) AND THE NATURE AND EXTENT OF QUALITY
CONTROL REQUIRED TO ASSURE THE SAFE AND RELIABLE OPERATION OF THE
REPAIRED PARTS.
THIS POLICY IS TO BE FOLLOWED EVEN THOUGH THE FINAL DECISION ON
QUALIFICATION OF SOURCES, WHICH MUST BE BASED ON SOUND ENGINEERING
PRINCIPLES AND JUDGMENT, IT TO BE MADE BY THE DEPARTMENT. WE HAVE HELD
THAT THIS POLICY APPEARS TO BE IN LINE WITH THE PROVISIONS OF ARMED
SERVICES PROCUREMENT REGULATION (ASPR) 1-313 (C), RELATING TO PARTS FOR
MILITARY EQUIPMENT, AT LEAST SO LONG AS FULLY ADEQUATE DATA, TEST
RESULTS AND QUALITY ASSURANCE PROCEDURES ARE NOT AVAILABLE WITH THE
RIGHT OF USE FOR PROCUREMENT PURPOSES. B-165738, APRIL 9, 1969.
THE AIR FORCE HAS ALSO PROMULGATED A POLICY OF NOT SEEKING ADDITIONAL
SOURCES OF APPROVED REPAIRS UNLESS THE DEMAND EXCEEDS THE PRODUCTION
CAPABILITIES OF EXISTING SOURCES AND SUCH SOURCES CANNOT BE EXPANDED TO
MEET DEMANDS WITHIN AVAILABLE LEAD TIME.
THE DEPARTMENT HAS ADVISED US THAT IT DOES NOT CONSIDER THAT YOU HAVE
DEVELOPED A COMPLETE REPAIR PROCEDURE FOR THE PARTS IN QUESTION SINCE
THE PLATING PROCESS IS BUT ONE OF THE REPAIR FUNCTIONS REQUIRED FOR
REFURBISHING THE SUBJECT PARTS AND THAT PLATINGS WITH METALS OTHER THAN
NICKEL ARE REQUIRED. IN THIS CONNECTION OCAMA REPORTS THAT IT HAS ONLY
APPROVED YOUR PLATING PROCESS AND THAT NO APPROVAL HAS BEEN GRANTED TO
YOUR CONCERN FOR THE OTHER REPAIR FUNCTIONS REQUIRED UNDER THE RFP.
ADDITIONALLY, THE DEPARTMENT HAS ADVISED US THAT THE METALLURGICAL
REPORTS YOU HAVE SUBMITTED ARE CONCERNED ONLY WITH PLATING OF THE J57
DISCS WHEREAS THE SUBJECT RFP ALSO REQUIRES SUCH WORK ON J75 AND T33
ENGINES.
IN VIEW THEREOF AND SINCE WE CANNOT DISPUTE THE CONTENTION THAT THE
APPROVAL OF REPAIR SOURCES BY P-AND-W IS NECESSARY TO ASSURE THE SAFE
AND RELIABLE OPERATION OF THE REPAIRED DISCS IN THE AIRCRAFT, WE CANNOT
MAINTAIN THAT THE DEPARTMENT IMPROPERLY EXCLUDED YOUR COMPANY FROM THE
SUBJECT PROCUREMENT. WITH RESPECT TO FUTURE PROCUREMENTS INVOLVING
REPAIR OF THE SUBJECT ITEMS THE AIR FORCE RECOMMENDS THAT YOU ACQUAINT
P-AND-W WITH THE ADVANTAGES OF YOUR PLATING PROCESS SO THAT YOU MAY
BECOME AN APPROVED SUPPLIER OF SUCH PLATING TO THE MANUFACTURER AND
OTHER FIRMS IF YOUR PROCESS POSSESSES THE ADVANTAGES WHICH YOU CLAIM.
B-167888, OCT. 27, 1969
NEGOTIATION--EVALUATION FACTORS--PROPRIETY OF EVALUATION
REGARDING NEGOTIATED PROCUREMENT AWARD TO LOW BIDDER FOR FLIGHT
INSTRUCTION, COST OF STUDENT FURNISHED TRANSPORTATION, BEING PART OF
TOTAL CONTRACT PRICE, WAS IMPROPERLY EVALUATED SINCE CONTRACTING OFFICER
DID NOT EXERCISE RESERVED RIGHT TO ADJUST MILEAGE AND DID NOT RESULT IN
AWARD TO BEST GOVERNMENT ADVANTAGE; CONTRACT TERMINATION PROVIDED FOR
IN AGREEMENT IS PRIMARILY FOR ADMINISTRATIVE DECISION OF BEST INTEREST
OF GOVT. AND WHETHER CONTRACT CANCELLATION AND AWARD TO OTHER BIDDER IS
IN GOVT.'S BEST INTEREST, PRICE AND OTHER FACTORS CONSIDERED, MUST
INCLUDE DETERMINATION OTHER BIDDER IS RESPONSIBLE, PROSPECTIVE
CONTRACTOR.
TO CLAIRE WALTERS FLIGHT ACADEMY:
FURTHER REFERENCE IS MADE TO YOUR PROTEST AGAINST THE PROPOSED
CANCELLATION OF NEGOTIATED CONTRACT NO. F01600-70-C-0018, AWARDED TO YOU
BY MAXWELL AIR FORCE BASE, FOR FURNISHING FLIGHT INSTRUCTIONS TO
APPROXIMATELY 56 AIR FORCE ROTC STUDENTS ATTENDING FIVE COLLEGES IN THE
LOS ANGELES AREA. THE CONTRACT INCLUDES REIMBURSEMENT TO YOU OF AN
ALLOWANCE OF SIX CENTS PER MILE TO EACH STUDENT FOR PRIVATE
TRANSPORTATION BETWEEN THE RESPECTIVE COLLEGES AND YOUR PLACE OF
INSTRUCTION.
YOU SUBMITTED THE LOW OFFER OF $28,083.68, INCLUDING $1,843.50 FOR
STUDENT FURNISHED TRANSPORTATION, AND FOX FLIGHT SERVICE WAS SECOND LOW
AT $28,349.20 INCLUDING $2,293.20 FOR STUDENT FURNISHED TRANSPORTATION.
THE AWARD WAS MADE TO YOU ON JULY 16, 1969, WITH PERFORMANCE TO BEGIN ON
SEPTEMBER 1, 1969. ON JULY 18, FOX PROTESTED THE AWARD CONTENDING THAT
YOU WERE LOW BECAUSE OF THE LOWER MILEAGE USED IN COMPUTING THE STUDENT
FURNISHED TRANSPORTATION FIGURE. SINCE THE TWO FIRMS ARE LOCATED IN THE
SAME BUILDING, THE MILEAGE SHOULD HAVE BEEN THE SAME IN BOTH CASES. BY
LETTER DATED JULY 31, 1969, THE CONTRACTING OFFICER ADVISED YOU TO
WITHHOLD PERFORMANCE UNTIL RESOLUTION OF THE PROTEST.
THE RECORD SHOWS THE FOLLOWING WITH RESPECT TO THE MILEAGE USED IN
THE TWO PROPOSALS AND THE ACTUAL MILEAGE AS MEASURED BY THE AIR FORCE
AFTER THE PROTEST:
COLLEGE FOX WALTERS ACTUAL
------- --- ------- ------
LOYOLA 12. 11.4 11.6
USC 30. 22.0 20.8
UCLA 12. 11.2 11.6
OCCIDENTAL 45. 44.4 37.2
CAL TECH 50. 49.6 47.6
THE REQUEST FOR PROPOSALS INCLUDES THE FOLLOWING PROVISION WITH
RESPECT TO STUDENT FURNISHED TRANSPORTATION: "/B) PROPOSALS REQUIRING
TRAVEL IN EXCESS OF THE ROUND TRIP MILEAGE INDICATED BELOW FROM THE AIR
FORCE ROTC ADMINISTRATION BUILDING ON EACH CAMPUS TO THE LOCATION WHERE
THE INSTRUCTION WILL BE PROVIDED MAY BE CONSIDERED NONRESPONSIVE AND MAY
BE REJECTED. THE GOVERNMENT RESERVES THE RIGHT TO VERIFY THE ROUND TRIP
MILEAGE SHOWN IN PART V OF THE SCHEDULE PROVISIONS AND TO ADJUST THE
UNIT PRICE PER TRIP FOR STUDENT-FURNISHED TRANSPORTATION IF THE ROUND
TRIP MILEAGE CITED IS IN ERROR. LOYOLA UNIVERSITY OF LOS ANGELES, LOS
ANGELES, CALIF. -- 12 ROUND TRIP MILES, UNIVERSITY OF CALIFORNIA, LOS
ANGELES, CALIF. -- 12 ROUND TRIP MILES, UNIVERSITY OF SOUTHERN
CALIFORNIA, LOS ANGELES, CALIF. -- 30 ROUND TRIP MILES. OCCIDENTAL
COLLEGE, LOS ANGELES, CALIF. -- 45 ROUND TRIP MILES, CALIFORNIA
INSTITUTE OF TECHNOLOGY, PASADENA, CALIF. -- 50 ROUND TRIP MILES.'
IN VIEW OF THE FACT THAT BOTH YOU AND FOX ARE LOCATED IN THE SAME
BUILDING AND THE REQUEST FOR PROPOSALS PERMITTED THE GOVERNMENT TO
VERIFY AND ADJUST MILEAGE AS STATED IN THE PROPOSALS, HEADQUARTERS,
UNITED STATES AIR FORCE, CONCLUDED THAT EVALUATION OF THE PROPOSALS AS
SUBMITTED WAS IMPROPER. SINCE FOX'S PROPOSAL WOULD BE APPROXIMATELY
$200 LESS THAN YOURS IF THE ACTUAL MILEAGE IS USED, IT IS THE
ADMINISTRATIVE RECOMMENDATION THAT THE CONTRACT BE CANCELLED AND AWARD
MADE TO FOX.
YOU WERE FURNISHED A COPY OF THE ADMINISTRATIVE REPORT AND HAVE
REPLIED THERETO. IT IS YOUR PRIMARY CONTENTION, THAT THE AWARD SHOULD
BE ALLOWED TO STAND AS PROPER IN THE CIRCUMSTANCES. IN THE FIRST PLACE,
YOU ARGUE THAT THE PRICE DIFFERENCE IN THE PROPOSALS SHOULD NOT BE THE
DETERMINATIVE FACTOR SINCE YOU CONTEND THAT FOX IS NOT A RESPONSIBLE
PROSPECTIVE CONTRACTOR. YOU STATE THAT FOX'S PERFORMANCE OF THE SAME
SERVICES DURING THE PRECEDING YEAR WAS UNSATISFACTORY; THAT FOX DID NOT
KEEP ITS OFFICE OPEN DURING NORMAL BUSINESS HOURS AND DID NOT PAY ITS
INSTRUCTORS THE GOING RATE; THAT FOX DOES NOT OWN ANY AIRCRAFT; AND
THAT FOX HAD ON LEASE ONLY TWO AIRCRAFT OF THE TYPE USED FOR TRAINING AT
THE BEGINNING OF THE CONTRACT LAST YEAR WHEN IT REPORTED HAVING FOUR.
SECONDLY, YOU CONTEND THAT FOX SHOULD NOT BE PERMITTED TO CHANGE ITS
PROPOSAL AFTER AWARD AND, IF IT IS PERMITTED TO DO SO, YOU SHOULD ALSO
BE PERMITTED TO "BID AGAIN". YOU ALSO STATE THAT IF FOX TRANSPORTED
STUDENTS LAST YEAR IT IS POSSIBLE THAT THE GOVERNMENT WAS OVER-CHARGED
FOR SUCH SERVICES. YOU HAVE ALSO FURNISHED INFORMATION CONCERNING YOUR
CAPABILITY TO PERFORM THE CONTRACT.
ALTHOUGH THIS WAS A NEGOTIATED PROCUREMENT AND AWARD IS NOT REQUIRED
TO BE MADE TO THE LOW RESPONSIVE AND RESPONSIBLE BIDDER AS IN AN
ADVERTISED PROCUREMENT, ARMED SERVICES PROCUREMENT REGULATION (ASPR)
3-101 REQUIRES THAT NEGOTIATED PROCUREMENTS BE MADE TO THE BEST
ADVANTAGE OF THE GOVERNMENT,"PRICE AND OTHER FACTORS CONSIDERED.' THIS
REGULATION CONTEMPLATES AWARD BEING MADE TO THE LOW OFFEROR, OTHER
FACTORS BEING EQUAL. IN THE INSTANT CASE, THE COST OF STUDENT FURNISHED
TRANSPORTATION IS A PART OF THE TOTAL COST OF THE CONTRACT TO THE
GOVERNMENT, AND, THEREFORE, NECESSARY IN DETERMINING THE LOW OFFEROR.
SINCE THE CONTRACTING OFFICER FAILED TO EXERCISE THE RESERVED RIGHT TO
VERIFY AND ADJUST THE MILEAGE OF BOTH PROPOSALS, HIS EVALUATION WAS NOT
PROPER AND DID NOT RESULT IN AN AWARD TO THE BEST ADVANTAGE OF THE
GOVERNMENT INSOFAR AS PRICE IS CONCERNED.
ARTICLE 14, GENERAL PROVISION FOR FLIGHT INSTRUCTION, OF THE CONTRACT
PROVIDES THAT THE CONTRACTING OFFICER MAY TERMINATE THE CONTRACT WHEN IT
IS IN THE BEST INTEREST OF THE GOVERNMENT. THE DETERMINATION OF THE
PUBLIC INTEREST IN THIS TYPE OF CASE IS A MATTER PRIMARILY FOR
ADMINISTRATIVE DECISION. 47 COMP. GEN. 1; 34 ID. 74. ORDINARILY, OUR
OFFICE DOES NOT DEEM IT PROPER TO SUBSTITUTE OUR JUDGMENT FOR THAT OF
THE CONTRACTING AGENCY WHEN IT HAS BEEN DETERMINED THAT TERMINATION FOR
CONVENIENCE IS IN THE BEST INTEREST OF THE GOVERNMENT.
HOWEVER, WHETHER CANCELLATION OF THE CONTRACT AND AWARD TO FOX IS IN
THE BEST INTEREST OF THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED,
MUST INCLUDE A DETERMINATION BY THE CONTRACTING OFFICER THAT FOX IS A
RESPONSIBLE PROSPECTIVE CONTRACTOR AS REQUIRED BY ASPR 1-904. AS NOTED
ABOVE, YOU HAVE RAISED QUESTIONS IN THIS AREA, INCLUDING THE CHARGE THAT
FOX POSSIBLY OVERCHARGED FOR STUDENT FURNISHED TRANSPORTATION UNDER THE
PREVIOUS CONTRACT. ALTHOUGH MR. RUEHMLING'S REPORT OF SEPTEMBER 10,
1969, OF WHICH YOU HAVE A COPY, STATES THAT THERE ARE NOT SUFFICIENT
GROUNDS FOR DECLARING FOX NONRESPONSIBLE, WE ARE CALLING TO THE
ATTENTION OF THE SECRETARY OF THE AIR FORCE THE REQUIREMENT OF ASPR
1-904.
SUBJECT TO THE ABOVE QUALIFICATION, WE FIND NO BASIS FOR OUR OFFICE
TO OBJECT TO THE PROPOSED CANCELLATION OF YOUR CONTRACT.
B-167757, OCT. 24, 1969
SPECIFICATIONS--RESTRICTIVE--PARTICULAR MAKE--INFORMATION SUFFICIENCY BY
BIDDER
UNDER INVITATION FOR BIDS FOR COAXIAL FREQUENCY METERS ON "BRAND NAME
OR EQUAL" BASIS WHICH LISTED THREE BRAND NAME PRODUCTS AND SPECIFIED
SINGLE AWARD TO BE MADE FOR ALL ITEMS, LOW BIDDER WHO FAILED TO SUBMIT
SUFFICIENT DESCRIPTIVE DATA FOR PROCURING PERSONNEL TO DETERMINE WHETHER
UNKNOWN "EQUAL" PRODUCT OFFERED CONFORMED TO SALIENT CHARACTERISTICS OF
BRAND NAME PRODUCTS LISTED AS REQUIRED BY INVITATION WAS PROPERLY
REJECTED AS NONRESPONSIVE BECAUSE, ASIDE FROM OTHER INADEQUACIES MODEL
BIDDER PROPOSED TO FURNISH FAILED TO COMPLY WITH MAXIMUM CALIBRATION
INCREMENT SPECIFIED IN INVITATION AND SCHEDULE REQUIRES THAT SINGLE
AWARD BE MADE. GAO CANNOT CONSIDER DECISION TO EXCLUDE BID AS IMPROPER
AND PROTEST IS DENIED.
TO MICROLAB/FXR:
REFERENCE IS MADE TO YOUR TELEGRAM, DATED AUGUST 20, 1969, AND
SUBSEQUENT CORRESPONDENCE CONCERNING YOUR PROTEST AGAINST REJECTION OF
YOUR BID UNDER INVITATION FOR BIDS N00039-69-B-2062, WHICH WAS ISSUED BY
THE NAVAL ELECTRONICS SYSTEMS COMMAND ON A "BRAND NAME OR EQUAL" BASIS
FOR THE PROCUREMENT OF 231 COAXIAL FREQUENCY METERS, TYPE I, AND 206 OF
TYPE II, WITH ASSOCIATED DATA REQUIREMENTS. SECTION A OF THE IFB
PROVIDED THAT A SINGLE AWARD WOULD BE MADE FOR ALL REQUIREMENTS OF THE
INVITATION. SECTION B, DESCRIPTION AND SPECIFICATIONS, STATED THAT THE
METERS WERE TO BE IN ACCORDANCE WITH THREE BRAND NAME PRODUCTS SET FORTH
IN AN IFB ATTACHMENT ENTITLED TECHNICAL REQUIREMENTS, WHICH ALSO
CONTAINED A DETAILED LISTING OF THE SALIENT CHARACTERISTICS OF THE
REFERENCED PRODUCTS, INCLUDING THE FOLLOWING REQUIREMENT FOR CALIBRATION
INCREMENTS:
"1.2.3. CALIBRATION INCREMENTS - THE CALIBRATION INCREMENTS OF THE
EQUIPMENT SHALL NOT EXCEED THE FOLLOWING:
TYPE I: 2 MEGACYCLE
TYPE II: 10 MEGACYCLE"
THE INVITATION CONTAINED THE FOLLOWING PROVISION REQUIRING BIDDERS TO
SUBMIT DESCRIPTIVE MATERIAL IN CONNECTION WITH ANY OFFER TO FURNISH A
PRODUCT EQUAL TO THE REFERENCED BRAND NAME TEMS:
"/C) (1) IF THE OFFEROR PROPOSES TO FURNISH AN -EQUAL- PRODUCT, THE
BRAND NAME, IF ANY, OF THE PRODUCT TO BE FURNISHED SHALL BE INSERTED IN
THE SPACE PROVIDED IN THE SOLICITATION, OR SUCH PRODUCT SHALL BE
OTHERWISE CLEARLY IDENTIFIED IN THE OFFER. THE EVALUATION OF OFFERS AND
THE DETERMINATION AS TO EQUALITY OF THE PRODUCT OFFERED SHALL BE THE
RESPONSIBILITY OF THE GOVERNMENT AND WILL BE BASED ON INFORMATION
FURNISHED BY THE OFFEROR OR IDENTIFIED IN HIS OFFER, AS WELL AS OTHER
INFORMATION REASONABLY AVAILABLE TO THE PURCHASING ACTIVITY. CAUTION TO
OFFERORS. THE PURCHASING ACTIVITY IS NOT RESPONSIBLE FOR LOCATING OR
SECURING ANY INFORMATION WHICH IS NOT IDENTIFIED IN THE OFFER AND
REASONABLY AVAILABLE TO THE PURCHASING ACTIVITY. ACCORDINGLY, TO INSURE
THAT SUFFICIENT INFORMATION IS AVAILABLE, THE OFFEROR MUST FURNISH AS A
PART OF HIS OFFER ALL DESCRIPTIVE MATERIAL (SUCH AS CUTS, ILLUSTRATIONS,
DRAWINGS, OR OTHER INFORMATION) NECESSARY FOR THE PURCHASING ACTIVITY TO
(I) DETERMINE WHETHER THE PRODUCT OFFERED MEETS THE REQUIREMENTS OF THE
SOLICITATION, AND (II) ESTABLISH EXACTLY WHAT THE OFFEROR PROPOSES TO
FURNISH AND WHAT THE GOVERNMENT WOULD BE BINDING ITSELF TO PURCHASE BY
MAKING AN AWARD. THE INFORMATION FURNISHED MAY INCLUDE SPECIFIC
REFERENCES TO INFORMATION PREVIOUSLY FURNISHED OR TO INFORMATION
OTHERWISE AVAILABLE TO THE PURCHASING ACTIVITY.' THE IFB WARNED BIDDERS
THAT THE FAILURE TO SUBMIT SUCH DATA MIGHT RESULT IN REJECTION OF THEIR
BIDS.
ALTHOUGH YOUR BID WAS THE LOWEST OF THE SIX OFFERS RECEIVED, THE
PROCURING ACTIVITY NOTED THAT THE CALIBRATION INCREMENT OF THE "EQUAL"
PRODUCT (MICROLAB/FXR MODEL NO. N420A) YOU PROPOSED TO FURNISH FOR TYPE
1 WAS 10 MEGACYCLES AND EXCEEDED THE MAXIMUM CALIBRATION INCREMENT FOR
THE ITEM LISTED IN THE TECHNICAL REQUIREMENTS. ADDITIONALLY, PROCURING
PERSONNEL WERE UNABLE TO DETERMINE EXACTLY WHAT YOU PROPOSED TO FURNISH,
AS REQUIRED BY IFB PROVISION C (1) (II), QUOTED ABOVE, SINCE YOUR
"EQUAL" PRODUCTS WERE UNKNOWN AND THE ONLY IDENTIFICATION OR DESCRIPTIVE
DATA FURNISHED WITH YOUR BID WERE YOUR MODEL NUMBERS, AN OUTLINE DRAWING
SHOWING THE EXTERNAL CONFORMATION OF YOUR METERS, AND A LISTING OF
ELECTRICAL AND MECHANICAL CHARACTERISTICS WHICH WERE SIMPLY COPIED FROM
THE SPECIFICATIONS OF THE IFB. IN VIEW THEREOF THE COMMAND CONSIDERS
YOUR BID NONRESPONSIVE, IN THAT IT FAILED TO FURNISH SUFFICIENT
INFORMATION TO JUSTIFY AN AFFIRMATIVE FINDING THAT THE ARTICLES OFFERED
WERE "EQUAL" TO THE BRAND NAMES CITED.
OUR OFFICE HAS HELD THAT THE FAILURE OF A BIDDER TO OFFER AN "EQUAL"
PRODUCT WHICH FULLY CONFORMS TO THE SALIENT CHARACTERISTICS OF THE BRAND
NAME PRODUCT REQUIRES THE REJECTION OF HIS BID. B-161892, OCTOBER 12,
1967; B-154656, NOVEMBER 9, 1964. ASIDE FROM ANY OTHER INADEQUACIES OF
YOUR BID, THE MODEL YOU PROPOSED TO FURNISH FOR THE REQUIREMENT SET
FORTH IN TYPE 1 FAILED TO COMPLY WITH THE MAXIMUM CALIBRATION INCREMENT
SPECIFIED FOR THAT ITEM, AND SINCE THE SCHEDULE REQUIRES THAT A SINGLE
AWARD BE MADE FOR ALL UNITS OF ITEMS 1 THROUGH 3AA, WE CANNOT CONSIDER
THE COMMAND'S DECISION TO EXCLUDE CONSIDERATION OF YOUR BID TO BE
IMPROPER.
WITH RESPECT TO THE SUFFICIENCY OF THE DATA YOU FURNISHED IN REGARD
TO THE OTHER SALIENT SPECIFICATIONS OF THE IFB, AS NOTED ABOVE, THIS
INFORMATION CONSISTED OF DRAWINGS ILLUSTRATING THE EXTERNAL
CONFIGURATION OF THE ITEMS TO BE FURNISHED, TOGETHER WITH A LISTING OF
THE SPECIFICATIONS OF THE ITEMS, WHICH MERELY RECITED COMPLIANCE WITH
THOSE REQUIREMENTS. OUR OFFICE HAS HELD THAT DATA OF THIS NATURE DOES
NOT COMPLY WITH THE INFORMATION REQUIRED UNDER THE "BRAND NAME OR EQUAL"
CLAUSE, QUOTED ABOVE, SINCE THE GOVERNMENT IS PRECLUDED FROM KNOWING
EXACTLY WHAT THE BIDDER PROPOSES TO FURNISH, AS IS DEMANDED UNDER THE
TERMS OF THAT CLAUSE. B-143585, OCTOBER 13, 1960; 41 COMP. GEN. 366;
B-162073, OCTOBER 4, 1969. IN THIS REGARD THE DATA YOU SUBMITTED DID
NOT CONTAIN ANY INFORMATION CONCERNING THE IDENTITY, SIZE AND STRUCTURE
OF THE INTERNAL COMPONENTS OF YOUR MODELS, THEREBY PREVENTING THE
COMMAND FROM DETERMINING PRECISELY WHAT YOU INTENDED TO OFFER. IT
APPEARS THAT AFTER BID OPENING YOU ADVISED THE CONTRACTING OFFICER THAT
YOUR MODEL NUMBERS OFFERED HAD NOT BEEN PREVIOUSLY MANUFACTURED, BUT
WOULD BE REVISED VERSIONS OF CERTAIN STANDARD MODELS IN YOUR LINE,
MODIFIED TO MEET THE REQUIREMENTS OF THIS PROCUREMENT. HAD THIS
INFORMATION BEEN FURNISHED WITH YOUR BID, WITH SPECIFIC DESCRIPTION OF
THE MODIFICATIONS PROPOSED, THE PROCURING ACTIVITY WOULD HAVE HAD SOME
BASIS FOR DETERMINATION OF THE "EQUALITY" OF THE METERS OFFERED, BUT
CONSIDERATION OF SUCH MATERIAL SUBMITTED AFTER BID OPENING IS
PROHIBITED.
B-167956, OCT. 24, 1969
INTEREST--PAYMENT DELAY--WATER RENTAL CHARGES--IRRIGATION PROJECTS
IRRIGATION DISTRICT WHICH PAID WATER RENTAL INSTALLMENT 1 CALENDAR
DAY AFTER EXPIRATION OF 30-DAY INTEREST-FREE PERIOD, LATE PAYMENT
OCCASIONED BY CLOSING ON SHORT NOTICE OF PAYMENT OFFICE ON LAST BUSINESS
DAY, DAY PAYMENT WAS CUSTOMARILY MADE, TO COMMEMORATE DEATH OF GENERAL
EISENHOWER WITH NATIONAL DAY OF MOURNING, IS NOT PROPERLY CHARGEABLE
WITH PENALTY, SINCE FAILURE TO PAY WAS NOT DUE TO FAULT, MISCONDUCT, OR
NEGLIGENCE ON PART OF IRRIGATION DISTRICT WHICH PROMPTLY PAID AFTER
CAUSE OF DELAY CEASED.
TO MR. A. E. DAZELL:
WE REFER TO YOUR LETTER OF SEPTEMBER 19, 1969, WITH ENCLOSURE (YOUR
REFERENCE 2-363), FORWARDING FOR OUR DECISION A CLAIM FOR RELIEF FROM
THE INTEREST PENALTY OF $1,378.00 ASSESSED AGAINST THE LOWER TULE RIVER
IRRIGATION DISTRICT (DISTRICT) FOR LATE PAYMENT OF AN INSTALLMENT OF
WATER RENTAL CHARGES UNDER ARTICLE 14 OF CONTRACT NO. 175R-2771, AS
AMENDED.
ARTICLE 14 OF THE CONTRACT AS AMENDED IN FEBRUARY 10, 1954, STATES:
"14. UPON EACH CHARGE TO BE PAID BY THE DISTRICT TO THE UNITED STATES
PURSUANT TO THIS CONTRACT WHICH SHALL REMAIN UNPAID AFTER THE SAME SHALL
HAVE BECOME DUE AND PAYABLE, THERE SHALL BE IMPOSED A PENALTY OF
ONE-HALF (1/2) OF ONE (1) PERCENT PER MONTH OF THE AMOUNT OF SUCH
DELINQUENT INSTALLMENT FROM AND AFTER THE DATE WHEN THE SAME BECOMES DUE
UNTIL PAID, AND THE DISTRICT HEREBY AGREES TO PAY SAID PENALTY: -- --
-- PROVIDED FURTHER, THAT NO PENALTY SHALL BE CHARGED TO OR BE PAID BY
THE DISTRICT UNLESS SUCH DELINQUENCY CONTINUES FOR MORE THAN THIRTY (30)
DAYS.'
YOU REPORT THAT THE INSTALLMENT DUE ON MARCH 1, 1969, WAS DELIVERED
AND PAID ON TUESDAY, APRIL 1, 1969, WHICH WAS ONE CALENDAR DAY BEYOND
THE 30-DAY INTEREST-FREE PERIOD. THEREFORE, THE DISTRICT WAS ASSESSED A
PENALTY OF ONE-HALF OF ONE PERCENT OF THE DELINQUENT INSTALLMENT
PURSUANT TO ARTICLE 14 AS AMENDED.
BY LETTER OF JUNE 23, 1969, THE DISTRICT PROTESTED THE ASSESSMENT OF
THE INTEREST PENALTY, ON THE GROUND THAT IT WAS UNABLE TO MAKE PAYMENT
ON MONDAY, MARCH 31, 1969, WITHIN THE 30-DAY INTEREST-FREE PERIOD,
BECAUSE THE FRESNO OFFICE OF THE BUREAU OF RECLAMATION WAS CLOSED ON
THAT DAY TO COMMEMORATE THE DEATH OF GENERAL EISENHOWER. THE DISTRICT
FURTHER STATED THAT IT WAS PREPARED TO MAKE THE PAYMENT ON MARCH 31 IN
ACCORDANCE WITH ITS LONG ESTABLISHED PROCEDURE OF PAYING THE INSTALLMENT
ON THE LAST BUSINESS DAY WITHIN THE 30-DAY PERIOD PROVIDED BY THE
CONTRACT.
PRESIDENTIAL PROCLAMATION NO. 3907, FILED ON FRIDAY, MARCH 28, 1969,
AT 3:28 P.M. IN THE FEDERAL REGISTER, DESIGNATED MONDAY, MARCH 31, 1969,
AS A NATIONAL DAY OF MOURNING. AS A RESULT, THE FRESNO OFFICE, THE
PLACE DESIGNATED FOR THE RECEIPT OF THE INSTALLMENT, WAS CLOSED ON THAT
DAY.
IT IS TO BE OBSERVED THAT THE PROCLAMATION WAS ISSUED LATE FRIDAY
AFTERNOON AND THAT THE FRESNO OFFICE PRESUMABLY WAS CLOSED ON THE
INTERVENING DAYS, I.E., SATURDAY AND SUNDAY. HAD THE DISTRICT BEEN
GIVEN SUFFICIENT NOTICE THAT THE FRESNO OFFICE WOULD BE CLOSED ON
MONDAY, THE LAST DAY OF THE 30-DAY INTEREST-FREE PERIOD, THE DISTRICT IN
ALL LIKELIHOOD WOULD HAVE BEEN ABLE TO MAKE ARRANGEMENTS TO PAY THE
INSTALLMENT ON FRIDAY.
IN SLAUGHTER V C.I.T. CORPORATION, 157 SO. 462, THE COURT DISCUSSED
THE EFFECT OF A PRESIDENTIAL PROCLAMATION DECLARING A BANK HOLIDAY FROM
MARCH 1 TO MARCH 10, 1933, ON AN INSTALLMENT DUE ON MARCH 4, 1933, AND
STATED THAT SUCH A DELAY CAUSED BY THE IMPOSSIBILITY OF MAKING PAYMENT
ON TIME IS EXCUSABLE FOR THE DURATION OF THE BANK HOLIDAY. SEE ALSO 6
CORBIN ON CONTRACTS, SEC. 1349. MOREOVER, THE RULE STATED IN 10 C.J.S.,
BILLS AND NOTES, SEC. 345 (C), IS THAT IT IS A GOOD DEFENSE TO THE MAKER
OF A NOTE, AS FAR AS COSTS AND DAMAGES ARE CONCERNED, THAT HE WAS
PREPARED WITH THE FUNDS AND READY TO MAKE PAYMENT OF THE PAPER AT THE
TIME AND PLACE SPECIFIED BUT THAT THE HOLDER WAS NOT THERE TO RECEIVE
THE MONEY.
ALTHOUGH PAYMENT WAS NOT MADE WITHIN 30 CALENDAR DAYS, THE DISTRICT
WAS PREVENTED FROM PAYING THE INSTALLMENT ON THE 30TH DAY BY THE ACTS OF
THE GOVERNMENT WITHOUT ANY DEFAULT, MISCONDUCT, OR NEGLIGENCE ON THE
PART OF THE DISTRICT. WHEN THE CAUSE OF THE DELAY CEASED, THE DISTRICT
PAID THE INSTALLMENT PROMPTLY WITH REASONABLE DILIGENCE.
IN THE CIRCUMSTANCES WE CONCLUDE THAT THE DISTRICT WAS NOT PROPERLY
CHARGEABLE WITH THE PENALTY, AND THE AMOUNT THEREOF MAY THEREFORE BE
REMITTED.
B-168011, OCT. 24, 1969
OFFICERS AND EMPLOYEES--TRANSFERS--RELOCATION EXPENSES--HOUSE
PURCHASE--LOAN CHARGES
EMPLOYEE WHO INCIDENT TO TRANSFER OF OFFICIAL STATION FROM
ALBUQUERQUE, NEW MEXICO, TO PORTLAND, OREGON, ENTERED INTO CONTRACT TO
PURCHASE HOME AT NEW DUTY STATION ON JULY 8, 1969, MAKING SETTLEMENT
THEREON ON SEPT. 4, 1969, IS NOT ENTITLED TO REIMBURSEMENT OF LOAN
EXPENSE FEE WITHIN MEANING OF SEC. 4.2D OF BUREAU OF BUDGET CIR. NO.
A-56 SINCE "LENDER'S LOAN ORIGINATION FEE" WAS REMOVED FROM LISTING OF
REIMBURSABLE EXPENSES BY TRANSMITTAL MEMORANDUM NO. 5, EFFECTIVE JUNE
26, 1969 AND, BECAUSE REGULATIONS IN EFFECT AT TIME EXPENSES ARE
INCURRED IS CONTROLLING DATE AND NOT DATE OF TRAVEL AUTHORIZATION AS
CLAIMED, REIMBURSEMENT OF EXPENSES INCURRED ON SEPT. 4, 1969 WAS NO
LONGER AUTHORIZED. SEE 47 COMP. GEN. 582.
TO MR. J. E. PERRY:
THIS REFERS TO YOUR LETTER OF SEPTEMBER 25, 1969, WITH ENCLOSURES,
REQUESTING A DECISION FROM OUR OFFICE AS TO THE PROPRIETY OF CERTIFYING
FOR PAYMENT A RECLAIM VOUCHER IN FAVOR OF MR. DAVID P. PROULX FOR
REIMBURSEMENT OF CERTAIN REAL ESTATE EXPENSES INCURRED IN CONNECTION
WITH THE PURCHASE OF A RESIDENCE AT HIS NEW DUTY STATION INCIDENT TO HIS
TRANSFER FROM ALBUQUERQUE, NEW MEXICO, TO PORTLAND, OREGON.
BY TRAVEL AUTHORIZATION DATED JUNE 9, 1969, MR. PROULX WAS AUTHORIZED
TO TRAVEL FROM ALBUQUERQUE, NEW MEXICO, TO PORTLAND, OREGON, INCIDENT TO
A PERMANENT CHANGE OF STATION. HE REPORTED TO HIS NEW DUTY STATION ON
JULY 3, 1969. ON JULY 8, 1969, HE ENTERED INTO A CONTRACT FOR THE
PURCHASE OF A HOME AT HIS NEW DUTY STATION AND SETTLEMENT THEREON WAS
MADE ON SEPTEMBER 4, 1969.
THE AMOUNT OF THE VOUCHER, $470, IS SHOWN ON THE CLOSING STATEMENT IN
THE REAL ESTATE TRANSACTION AS BEING EQUAL TO TWO PERCENT OF THE LOAN
AMOUNT AND IS IDENTIFIED ON THE STATEMENT AS ,LOAN EXPENSE.' IN
CONNECTION WITH THE SALE OF A RESIDENCE, THE COST OF A PERCENTAGE LOAN
EXPENSE FEE IS CUSTOMARILY PAID BY THE PURCHASER. THIS FEE SOMETIMES
REFERRED TO AS A "PLACEMENT FEE, COMMISSION LOAN FEE, CLOSING FEE, OR
INITIAL SERVICE CHARGE" WAS REIMBURSABLE AS A FEE OR CHARGE SIMILAR TO
LOAN APPLICATION OR LENDER'S LOAN ORIGINATION FEE WITHIN THE MEANING OF
SECTION 4.2D OF BUREAU OF THE BUDGET CIRCULAR NO. A-56, REVISED OCTOBER
12, 1966. HOWEVER, WITH THE REVISION OF CIRCULAR NO. A-56 AS PROVIDED
UNDER TRANSMITTAL MEMORANDUM NO. 5, EFFECTIVE JUNE 26, 1969, THIS
,"LENDER'S LOAN ORIGINATION FEE," WAS REMOVED FROM THE LISTING OF
REIMBURSABLE EXPENSES UNDER SECTION 4.2D RELATING TO ALLOWANCE FOR
EXPENSES INCURRED IN CONNECTION WITH RESIDENCE TRANSACTIONS.
YOU SAY THERE IS DOUBT AS TO WHAT DATE IS CONTROLLING INSOFAR AS
APPLYING THE NEW REVISION OF THE REGULATIONS. THE EMPLOYEE CONTENDS
THAT HE SHOULD BE ALLOWED REIMBURSEMENT OF THE LOAN ORIGINATION FEE ON
THE BASIS THAT THE TRAVEL ORDER AUTHORIZING HIS TRANSFER OF OFFICIAL
STATION WAS ISSUED ON JUNE 9, 1969, AND THAT THE REGULATIONS IN EFFECT
AT THAT TIME SHOULD BE CONTROLLING RATHER THAN THE REVISED REGULATIONS
EFFECTIVE JUNE 26, 1969.
WE HAVE NEVER REGARDED THE DATE OF A TRAVEL AUTHORIZATION AS FIXING
IN ALL RESPECTS THE RIGHTS OF AN EMPLOYEE TO BENEFITS PROVIDED BY
REGULATIONS THEN IN EFFECT. UNDER THE PROVISIONS OF PUBLIC LAW 89-516,
NOW 5 U.S.C. 5724A, OUR VIEW HAS BEEN THAT THE DATE THE EXPENSES ARE
INCURRED IS CONTROLLING IN MOST SITUATIONS. SEE 47 COMP. GEN. 582. HERE
THE EXPENSES WERE INCURRED AT THE TIME OF SETTLEMENT ON SEPTEMBER 4,
1969. SINCE THE REGULATIONS IN EFFECT ON THAT DATE NO LONGER CONTAINED
ANY PROVISION AUTHORIZING REIMBURSEMENT OF A LOAN ORIGINATION FEE, THE
CLAIM MAY NOT BE ALLOWED.
THE FACT THAT MR. PROULX HAD NO KNOWLEDGE OF THE CHANGE IN
REGULATIONS AS STATED BY HIM IS IMMATERIAL. THE REGULATIONS ISSUED ARE
STATUTORY IN NATURE AND HAVE THE FORCE AND EFFECT OF LAW. THUS, HE IS
CHARGEABLE WITH CONSTRUCTIVE NOTICE OF SUCH REGULATIONS AND ANY CHANGES
THEREIN FROM THE DATE OF ISSUANCE THEREOF OR THE PROSPECTIVE DATE
SPECIFIED BY THE BUREAU OF THE BUDGET.
THE VOUCHER WHICH IS RETURNED HEREWITH MAY NOT BE CERTIFIED FOR
PAYMENT.
B-165721, OCT. 23, 1969
TRAVEL EXPENSES--OVERSEAS EMPLOYEES--TRANSFERS--BETWEEN DUTY STATIONS
OVERSEAS
DISALLOWANCE OF CLAIM FOR DIFFERENCE BETWEEN AIR AND SURFACE
TRANSPORTATION FROM JAPAN TO HONOLULU, UTILIZED BY FEDERAL AVIATION
ADMINISTRATION (FAA) EMPLOYEE AND DEPENDENTS INCIDENT TO HOME LEAVE AND
TRANSFER FROM SEOUL TO MANILA UNDER TRAVEL ORDERS AUTHORIZING AIR TRAVEL
TO HONOLULU, IS SUSTAINED SINCE FAA EMPLOYEE, ASSIGNED OVERSEAS DUTY
WITH AGENCY FOR INTERNATIONAL DEVELOPMENT (AID) WAS SUBJECT TO AID
TRAVEL AND TRANSPORTATION REGULATIONS RESTRICTING USE OF SURFACE
TRANSPORTATION. EMPLOYEE, TRAVELING FOR PURPOSE OF SEPARATION (AID
APPARENTLY CONSIDERING TRAVEL WAS FOR SEPARATION SINCE EMPLOYEE WAS NOT
RETURNING TO AID POSITION) IS REQUIRED TO TRAVEL BY AIR, AT LEAST ONE
WAY, BUT REGULATION DOES NOT PRECLUDE USE OF AIR TRAVEL BOTH WAYS AND
RESTRICTION TO AIR TRAVEL WAS PROPER.
TO MR. CHARLES J. STALEY:
REFERENCE IS MADE TO YOUR LETTER OF AUGUST 20, 1969, REQUESTING
RECONSIDERATION OF OUR DISALLOWANCE OF YOUR CLAIM FOR REIMBURSEMENT OF
ADDITIONAL TRAVEL EXPENSES FOR YOU AND YOUR DEPENDENTS FROM SEOUL,
KOREA, TO HONOLULU, HAWAII, AND TO DAYTON, OHIO, INCIDENT TO YOUR
TRANSFER FROM SEOUL TO MANILA, REPUBLIC OF THE PHILIPPINES, AND HOME
LEAVE UNDER TRAVEL ORDER NO. 0932/002-460, MARCH 29, 1967, AS AMENDED
ON JUNE 5, 1967, ISSUED BY THE FEDERAL AVIATION ADMINISTRATION (FAA).
THE TRAVEL ORDER OF MARCH 29, 1967, AUTHORIZED TRAVEL BY AIRPLANE
FROM SEOUL TO HONOLULU IN ACCORDANCE WITH THE REGULATIONS OF THE AGENCY
FOR INTERNATIONAL DEVELOPMENT (AID). THE ORDER ALSO STATED THAT THE
PACIFIC REGION, FAA, WOULD PROVIDE HOME LEAVE AND CHANGE OF STATION
TRAVEL FROM HONOLULU TO MANILA. THE PACIFIC REGION STATED IT HAD NO
AUTHORITY TO AUTHORIZE TRAVEL TO THE UNITED STATES. AFTER A LENGTHY
EXCHANGE OF CORRESPONDENCE THE ORDER WAS AMENDED ON JUNE 5, 1967, TO
PROVIDE THAT FAA/W WOULD AUTHORIZE TRAVEL FROM SEOUL TO THE UNITED
STATES AND THAT THE PACIFIC REGION WOULD PAY THE OTHER TRAVEL COSTS. ON
MAY 9, 1967, YOU AND YOUR DEPENDENTS TRAVELED BY AIRPLANE FROM SEOUL TO
JAPAN WHERE YOU REMAINED UNTIL MAY 12 WHEN YOU DEPARTED FROM YOKOHAMA BY
SHIP. YOU ARRIVED IN HONOLULU ON MAY 19 AND DEPARTED BY AIRPLANE FOR
THE UNITED STATES ON MAY 25. THE ADMINISTRATIVE OFFICE STATED YOU WERE
NOT AUTHORIZED TO TRAVEL BY SHIP AND ON THE BASIS OF A CONSTRUCTIVE
SCHEDULE OF TRAVEL BY AIRPLANE CHARGED YOU WITH EXCESS COSTS OF
$1,673.75. YOU CONTEND THAT YOU WERE ENTITLED TO TRAVEL BY SHIP AND
RECLAIM THE AMOUNT CHARGED.
THE RECORD INDICATES THAT IN 1965 YOU WERE REASSIGNED FROM YOUR
POSITION WITH THE PACIFIC REGION OF FAA TO A POSITION WITH AID IN SEOUL.
IN CONNECTION WITH THE ASSIGNMENT YOU SIGNED A FORM FAA-2666/6-59)
DATED MARCH 3, 1965. FAA AGREED TO PAY THE COST OF YOUR TRAVEL AND THE
TRANSPORTATION OF YOUR DEPENDENTS AND HOUSEHOLD EFFECTS TO SEOUL AND YOU
AGREED TO REMAIN AT THAT POST FOR 1 YEAR. THE AGREEMENT ALSO PROVIDED
FOR FAA TO PAY HOME LEAVE TRAVEL AND TRANSPORTATION COSTS AT THE
COMPLETION OF YOUR TOUR OF SERVICE AT SEOUL. IN A SUBSEQUENT AGREEMENT
DATED FEBRUARY 8, 1966, YOU AGREED TO EXTEND YOUR TOUR TO 2 YEARS.
AT THE TIME OF THE TRAVEL INVOLVED IN THIS CASE A GENERAL AGREEMENT
BETWEEN FAA AND AID DATED FEBRUARY 25, 1966, WAS IN EFFECT TO IMPLEMENT
FOREIGN ASSISTANCE PROGRAMS. UNDER THIS AGREEMENT PERSONNEL OF FAA
ASSIGNED FOR DUTY OVERSEAS REMAINED EMPLOYEES OF FAA, ALTHOUGH THEY WERE
ADMINISTRATIVELY RESPONSIBLE TO AID, AND AID REGULATIONS GOVERNED THEIR
TRAVEL AND TRANSPORTATION ALLOWANCES.
CERTAIN RESTRICTIONS ON THE USE OF SURFACE TRANSPORTATION WERE
PROMULGATED BY AID ON JANUARY 20 AND JUNE 9, 1966, AND INCORPORATED INTO
AID MANUAL ORDER NO. 560.2, EFFECTIVE OCTOBER 7, 1966. WHEN AN EMPLOYEE
TRAVELS FOR THE PURPOSE OF SEPARATION HE IS REQUIRED TO TRAVEL BY AIR.
AID APPARENTLY CONSIDERED YOUR TRAVEL AS BEING FOR THE PURPOSE OF
SEPARATION SINCE YOU WERE NOT RETURNING TO AN AID POSITION. YOU BELIEVE
THE SEPARATION PROVISION IS INAPPLICABLE IN YOUR CASE INASMUCH AS YOU
WERE TRAVELING FOR THE PURPOSE OF TAKING HOME LEAVE IN CONNECTION WITH A
TRANSFER OF STATION IN WHICH CASE THE REGULATION REQUIRES AIR AT LEAST
ONE WAY. HOWEVER, THE LATTER PROVISION DOES NOT PRECLUDE THE USE OF AIR
TRAVEL BOTH WAYS AND, THEREFORE, IT WAS PROPER FOR THE AGENCY TO
RESTRICT YOUR TRAVEL TO AIR.
YOU STATE THAT YOUR DEPENDENTS TRAVELED BY SURFACE TRANSPORTATION
BETWEEN HONOLULU AND YOKOHAMA, JAPAN, IN CONNECTION WITH YOUR ORIGINAL
TRANSFER ORDERS TO KOREA AND THAT YOU FAIL TO UNDERSTAND THE DIFFERENT
INTERPRETATION IN THIS CASE. AT THE TIME OF THE TRAVEL TO KOREA THERE
WERE NO RESTRICTIONS ON THE USE OF SURFACE TRANSPORTATION BY DEPENDENTS.
HOWEVER, THE RESTRICTIONS SUBSEQUENTLY PROMULGATED BY AID COVERED NOT
ONLY EMPLOYEES BUT ALSO THEIR DEPENDENTS.
IN VIEW OF THE ABOVE, THE DISALLOWANCE OF YOUR CLAIM MUST BE AND IS
SUSTAINED.
B-167556, OCT. 23, 1969
TRAVEL EXPENSES--OVERSEAS EMPLOYEES--FAILURE TO FULFILL
CONTRACT--REIMBURSEMENT ENTITLEMENT
OVERSEAS EMPLOYEE DISALLOWED REIMBURSEMENT OF TRAVEL EXPENSES FROM
BRUSSELS TO ATLANTA, GA; INCIDENT TO HER RESIGNATION FROM STATE
DEPARTMENT WHILE ON HOME LEAVE, WHO DISPUTES APPLICABILITY OF GENERAL
RULE TO CLAIMS OF HIGHER LEVEL OFFICIALS AND ASSERTS BELIEF THAT
EMPLOYEE'S REASONS FOR HOME LEAVE AND LOCATION AT TIME OF RESIGNATION
ARE IMMATERIAL FOR REIMBURSEMENT OF TRAVEL EXPENSE PURPOSES, IS ADVISED
DECISION DISALLOWING CLAIM WAS BASED ON CONSIDERATION OF PERTINENT
STATUTES, REGULATIONS, AND GENERAL RULES GIVING EFFECT THERETO, WHICH
ARE APPLIED UNIFORMLY TO ALL CLAIMS REGARDLESS OF RANK OF CLAIMANTS.
SINCE CLAIMANT HAS NOT SUBMITTED ANY EVIDENCE INDICATING GENERAL RULE
WAS NOT APPLICABLE, THERE EXISTS NO BASIS FOR CLAIM ALLOWANCE.
TO MRS. RUTH M. COOK:
REFERENCE IS MADE TO YOUR LETTER OF SEPTEMBER 30, 1969, CONCERNING
OUR DECISION OF SEPTEMBER 25, 1969, WHICH SUSTAINED THE DISALLOWANCE OF
YOUR CLAIM FOR REIMBURSEMENT OF TRAVEL EXPENSES FROM BRUSSELS, BELGIUM,
TO ATLANTA, GEORGIA, ON OCTOBER 27, 1967, INCIDENT TO YOUR RESIGNATION
FROM YOUR POSITION WITH THE DEPARTMENT OF STATE.
YOUR CLAIM WAS DISALLOWED UNDER THE GENERAL RULE THAT AN OVERSEAS
EMPLOYEE WHO RESIGNS WHILE AT HOME ON LEAVE IS NOT ENTITLED TO
REIMBURSEMENT OF TRAVEL EXPENSES FROM HIS OVERSEAS STATION TO HIS HOME.
THE REASONS FOR THE RULE WERE SET FORTH IN OUR DECISION AND NEED NOT BE
REPEATED HERE.
YOU STATE THAT THE DECISIONS SUPPORTING OUR DISALLOWANCE APPLY TO
CLERICAL EMPLOYEES AND REQUEST EXAMPLES OF DECISIONS DISALLOWING CLAIMS
OF HIGHER LEVEL OFFICIALS. YOU ALSO BELIEVE THAT IT DOES NOT MATTER WHY
YOU WENT HOME OR WHERE YOU WERE WHEN YOU RESIGNED YOUR POSITION.
OUR DECISIONS ARE BASED ON A CONSIDERATION OF PERTINENT STATUTES,
REGULATIONS, AND GENERAL RULES GIVING EFFECT TO SUCH STATUTES AND
REGULATIONS. THE PERTINENT LAW, REGULATIONS, AND GENERAL RULES ARE
APPLIED UNIFORMLY TO ALL CLAIMS REGARDLESS OF THE RANK OF THE CLAIMANTS.
FOR EXAMPLE, SEE OUR DECISION B-167754, SEPTEMBER 8, 1969, COPY
ENCLOSED. IN THE INSTANT CASE YOU HAVE NOT SUBMITTED ANY EVIDENCE
INDICATING THAT THE GENERAL RULE IS INAPPLICABLE TO YOUR CLAIM.
THEREFORE, WE HAVE NO BASIS UPON WHICH TO ALLOW YOUR CLAIM.
WITH REGARD TO FURTHER PROSECUTION OF YOUR CLAIM, WE POINT OUT THAT
DECISIONS OF THIS OFFICE ARE BINDING UPON THE EXECUTIVE BRANCH OF THE
FEDERAL GOVERNMENT. AS TO MATTERS COGNIZABLE BY THE UNITED STATES
DISTRICT COURTS AND THE UNITED STATES COURT OF CLAIMS, SEE 28 U.S.C.
1346 AND 1491.
B-167699, OCT. 23, 1969
TIMBER SALES--DEPOSITS--REFUND
WHERE CLAIMANT (SUCCESSFUL BIDDER) HAD SUBMITTED BID DEPOSIT AND
PARTICIPATED IN TIMBER SALE BIDDING ON BASIS OF ERRONEOUS BELIEF THAT IT
COULD OBTAIN DIRECT LOAN FROM SMALL BUSINESS ADMINISTRATION (SBA) TO
FINANCE ROAD CONSTRUCTION REQUIRED UNDER CONTRACT (WITHOUT WHICH LOAN
BIDDER COULD NOT PERFORM), CLAIMANT IS ENTITLED TO DEPOSIT REFUND, AS
SALE PROSPECTUS REPRESENTATION OF FINANCIAL ASSISTANCE AVAILABILITY WAS
IDENTICAL TO PROVISIONS UNDER WHICH CLAIMANT HAD PREVIOUSLY ACQUIRED
DIRECT SBA LOANS AND UNDER WHICH IT APPARENTLY WOULD HAVE BEEN ELIGIBLE
IN THIS CASE BUT FOR CHANGE IN SBA POLICY NOT REFLECTED IN PROSPECTUS,
AND CLAIMANT WAS MISLED AND INDUCED TO BID BY PROSPECTUS TO DEGREE
RENDERING SALE CONTRACT UNENFORCEABLE.
TO MR. SECRETARY:
FURTHER REFERENCE IS MADE TO A CLAIM BY LANDRETH TIMBER COMPANY, INC.
(LANDRETH), FOR REIMBURSEMENT OF ITS BID DEPOSIT SUBMITTED FOR THE
HENDERSON TIMBER SALE, OKANOGAN NATIONAL FOREST, IN THE AMOUNT OF
$21,000. THIS MATTER WAS THE SUBJECT OF A REPORT FROM THE ACTING CHIEF,
FOREST SERVICE, DATED SEPTEMBER 16, 1969, REFERENCE 2430.
THE RECORD INDICATES THAT ON APRIL 17, 1969, AN INVITATION FOR BIDS
WAS ISSUED FOR AN ESTIMATED 9,400 M BOARD FEET OF TIMBER MARKED OR
OTHERWISE DESIGNATED FOR CUTTING. THE INVITATION CONTEMPLATED THAT
ROADS BE CONSTRUCTED TO SPECIFICATIONS AND THAT CREDITS UP TO THE AMOUNT
SHOWN IN THE SALE PROSPECTUS BE CREDITED TO THE PURCHASER'S TIMBER SALE
ACCOUNT AS ROADS WERE CONSTRUCTED AND ACCEPTED. THE INVITATION
SPECIFIED A MINIMUM UNIT PRICE TO WHICH ALL INTERESTED BIDDERS WERE
REQUIRED TO AGREE IN ORDER TO BECOME ELIGIBLE FOR PARTICIPATION IN AN
ORAL AUCTION IN WHICH THE FINAL PRICE AND HIGHEST BIDDER WERE TO BE
DETERMINED. IN ADDITION, ONLY SMALL BUSINESS CONCERNS MAKING A DEPOSIT
OF $21,000 WERE ELIGIBLE TO PARTICIPATE IN THE AUCTION. LANDRETH'S BID
OF $666,150 WAS THE HIGHEST OFFERED AT THE AUCTION AND WAS ACCEPTED BY
THE GOVERNMENT ON MAY 29, 1969.
ESSENTIALLY, IT IS LANDRETH'S POSITION THAT THE COMPANY SUBMITTED A
BID DEPOSIT AND PARTICIPATED IN THE BIDDING ON THE BASIS OF AN ERRONEOUS
BELIEF THAT A DIRECT LOAN OF $50,000 COULD BE OBTAINED FROM THE SMALL
BUSINESS ADMINISTRATION (SBA) TO FINANCE THE CONSTRUCTION OF ROADS
REQUIRED UNDER THE CONTRACT. THE COMPANY ADVISES ITS BELIEF RESULTED
FROM THE FACT THAT IT HAD PREVIOUSLY OBTAINED DIRECT SBA LOANS UNDER
SEVERAL TIMBER SALES INVITATIONS WHICH CONTAINED A PROVISION IDENTICAL
TO THE REPRESENTATION MADE IN THE INSTANT TIMBER SALE PROSPECTUS WHICH
PROVIDED, IN PERTINENT PART, AS FOLLOWS:
"12. FINANCIAL ASSISTANCE. THE SMALL BUSINESS ADMINISTRATION (SBA)
THROUGH AN AGREEMENT WITH FOREST SERVICE, HAS EXTENDED ITS FINANCIAL
ASSISTANCE TO SMALL BUSINESS CONCERNS TO INCLUDE LOANS TO FINANCE
CONSTRUCTION OF ROADS SPECIFIED UNDER A9, TABLE 5 OF THE TIMBER SALE
CONTRACT. APPLICANTS MUST MEET SBA SIZE, ELIGIBILITY AND CREDIT
REQUIREMENTS. IF REQUESTED BY PURCHASER OR AWARDEE, THE TIMBER SALE
CONTRACT WILL PROVIDE FOR REPAYMENT OF SUCH LOANS THROUGH FOREST SERVICE
AS THE TIMBER IS CUT.' THE COMPANY CONTENDS IT WAS MISLED BY THE
GOVERNMENT'S FAILURE TO CHANGE THE WORDING OF THE INSTANT TIMBER SALE
PROSPECTUS SO AS TO ALERT BIDDERS TO THE FACT THAT SBA HAD DISCONTINUED
ITS PRACTICE OF MAKING DIRECT LOANS FOR TIMBER ACCESS ROADS AND THAT IT
WOULD ONLY MAKE PARTICIPATION LOANS WITH BANKS OR GUARANTEE SUCH LOANS.
UNDER THE PROGRAM IN EFFECT AT THE TIME OF PRIOR SALES SBA WOULD LEND
FUNDS TO SMALL BUSINESS CONCERNS WHICH SATISFACTORILY DEMONSTRATED THAT
THE DESIRED CREDIT WAS NOT OTHERWISE AVAILABLE ON REASONABLE TERMS,
WHEREAS UNDER THE PRESENT LOAN PROGRAM SBA WILL LEND ONLY A PORTION OF
THE DESIRED LOAN (UP TO 75 PERCENT) IF A PARTICIPATING FINANCIAL
INSTITUTION AGREES TO PROVIDE THE REMAINING PORTION. LANDRETH CONTENDS
THAT IT WOULD HAVE BEEN ELIGIBLE FOR A DIRECT SBA LOAN, AND IN SUPPORT
OF ITS POSITION HAS SUBMITTED COPIES OF LETTERS FROM THREE BANKS
REFUSING TO LEND 25 PERCENT OF A $50,000 LOAN EVEN IF SBA DOES LEND THE
REMAINING 75 PERCENT. ACCORDINGLY, THE COMPANY HAS TAKEN THE POSITION
THAT IT IS UNABLE TO PERFORM, SHOULD BE PERMITTED TO WITHDRAW ITS BID,
AND IS ENTITLED TO A REFUND OF ITS $21,000 BID DEPOSIT.
INCLUDED IN THE FOREST SERVICE'S REPORT TO THIS OFFICE IS A LETTER
FROM THE SBA REGIONAL COUNSEL DATED JULY 29, 1969, WHEREIN IT IS STATED
THAT DUE TO BUDGETARY RESTRICTIONS THE AGENCY HAS DISCONTINUED MAKING
LOANS UNDER THE TIMBER ACCESS ROAD LOAN PROGRAM BUT THAT FINANCIAL
ASSISTANCE HAS BEEN PROVIDED CONTRACTORS UNDER THE IMMEDIATE
PARTICIPATION LOAN PROGRAM. IT HAS ALSO BEEN CONFIRMED THAT LANDRETH
OBTAINED SEVERAL DIRECT LOANS FROM SBA IN THE PAST UNDER THE FORMER SBA
PROGRAM.
AS A GENERAL RULE, AN INNOCENT MISREPRESENTATION WITH RESPECT TO A
MATERIAL FACT MAY AFFORD GROUND FOR INVALIDATION OF A CONTRACT INDUCED
THEREBY, PROVIDED THE PARTY RELIED THEREON AND WAS MISLED THEREBY 17
C.J.S. CONTRACTS, SECTION 147.
IN ITS REPORT TO THIS OFFICE, FOREST SERVICE HAS TAKEN THE POSITION
THAT THE "FINANCIAL ASSISTANCE" CLAUSE IN THE SALE PROSPECTUS IS NOT
CONSIDERED A GUARANTEE OF A DIRECT LOAN AND, THEREFORE, LANDRETH'S BID
DEPOSIT SHOULD NOT BE REFUNDED. WHILE WE MUST AGREE THAT THE SALE
PROSPECTUS DID NOT ACTUALLY GUARANTEE A DIRECT SBA LOAN TO BIDDERS, WE
ARE OF THE OPINION THAT THE RECORD AND THE CIRCUMSTANCES OF THIS CASE
SUPPORT LANDRETH'S POSITION THAT IT BID BECAUSE THE REPRESENTATION OF
THE AVAILABILITY OF FINANCIAL ASSISTANCE IN THE SALE PROSPECTUS WAS
IDENTICAL TO THE PROVISIONS UNDER WHICH IT HAD PREVIOUSLY ACQUIRED
DIRECT SBA LOANS, AND UNDER WHICH IT APPARENTLY WOULD HAVE BEEN ELIGIBLE
IN THIS CASE IN VIEW OF THE FACT THAT THREE BANKS REFUSED TO EXTEND
CREDIT TO THE COMPANY. FURTHERMORE, WE NOTE THAT THE DEFINITION OF THE
TERM "FINANCIAL ASSISTANCE," IN THE CURRENT SBA REGULATION, 13 CFR 120.1
(B), INCLUDES THE MAKING OF DIRECT SBA LOANS.
FOR THE ABOVE REASONS WE MUST CONCLUDE THAT THE BIDDER WAS MISLED AND
INDUCED TO BID BY THE SALE PROSPECTUS TO A DEGREE WHICH WOULD RENDER THE
CONTRACT OF SALE UNENFORCEABLE, AND THE BIDDER IS THEREFORE ENTITLED TO
HAVE THE FULL AMOUNT OF ITS BID DEPOSIT RETURNED.
IT IS SUGGESTED THAT APPROPRIATE ACTION BE TAKEN IN FUTURE
PROCUREMENTS TO INSURE THAT BIDDERS ARE EITHER ADVISED PRIOR TO BID
OPENING OF THE EXTENT TO WHICH SBA MAY HAVE MODIFIED ITS FINANCIAL
ASSISTANCE PROGRAMS, OR THAT THEY ARE CAUTIONED TO VERIFY WITH SBA,
BEFORE BIDDING, THE TYPE AND EXTENT OF ASSISTANCE WHICH IS AVAILABLE
FROM THAT AGENCY.
B-167887, OCT. 23, 1969
MISTAKES--ALLEGATION PRIOR TO AWARD--CORRECTION--STILL LOWEST BID
AFTER REQUESTED BID VERIFICATION, AND UPON RECEIPT OF ORIGINAL
WORKSHEETS EVIDENCING ERROR IN COMPUTATION OF LOW BID WHICH ALLEGEDLY
RESULTED FROM SUBCONTRACTOR, ONE HOUR BEFORE MAILING OF BID, REVISING
QUOTATION OF ASPHALT PAVING COSTS WHICH WERE SUBTRACTED FROM RATHER THAN
ADDED TO TOTAL PRICE, ADMINISTRATIVE DECISION, IN ACCORDANCE WITH
REGULATORY AUTHORITY TO ALLOW $4,200 PRICE INCREASE WILL NOT BE
DISTURBED, SINCE NO LEGAL BASIS EXISTS TO CONCLUDE THAT EVIDENCE WAS NOT
SUFFICIENTLY CLEAR TO WARRANT CORRECTION. BID AS CORRECTED WILL STILL
BE LOWEST AND SHOULD BE CONSIDERED FOR AWARD IF OTHERWISE PROPER.
TO TECTONICS, INC.:
REFERENCE IS MADE TO YOUR TELEGRAM OF SEPTEMBER 11, 1969, PROTESTING
THE AWARD OF A CONTRACT TO THE SOUTHWEST ENGINEERING CO. UNDER
INVITATION FOR BIDS NO. ES-16-5-70, ISSUED BY THE UNITED STATES WEATHER
BUREAU, CENTRAL REGION HEADQUARTERS, ENVIRONMENTAL SCIENCE SERVICES
ADMINISTRATION, KANSAS CITY, MISSOURI.
THE INVITATION WAS ISSUED ON JULY 17, 1969, FOR CONSTRUCTION OF AN
OFFICE BUILDING AND ERECTION AND MODIFICATION OF A 50-FOOT STEEL RADAR
TOWER IN MONETT, MISSOURI. FIVE BIDS WERE RECEIVED IN RESPONSE TO THE
INVITATION WHICH WAS OPENED ON SEPTEMBER 5, 1969, AS FOLLOWS:
COMPANY BID
------- ---
CARSON-MITCHELL, INC. $208,400
HOMER CARR CONSTRUCTION COMPANY 199,050
A.G. PROCTOR COMPANY, INC. 188,500
TECTONICS, INC. 174,000
SOUTHWEST ENGINEERING CO. 116,540
BECAUSE THE LOW BID SUBMITTED BY SOUTHWEST WAS SIGNIFICANTLY LOWER
THAN ALL OTHER BIDS RECEIVED, THE CONTRACTING OFFICER AT KANSAS CITY,
SUSPECTING THAT A MISTAKE HAD BEEN MADE, TELEPHONED SOUTHWEST ON
SEPTEMBER 8, 1969, AND REQUESTED VERIFICATION OF ITS BID. SOUTHWEST
RESPONDED BY LETTER DATED SEPTEMBER 8, 1969, IN WHICH IT STATED THAT
THERE WAS A $4,200 ARITHMETIC MISTAKE IN ITS LUMP-SUM BID. IN SUPPORT
OF THE ALLEGATION OF MISTAKE, SOUTHWEST FURNISHED ITS ORIGINAL
WORKSHEETS AND REQUESTED THAT ITS BID BE CORRECTED UPWARD TO ADJUST THE
$4,200 MISTAKE.
A REVIEW OF THE WORKSHEETS BY THE CONTRACTING OFFICER DISCLOSED THAT
THE ERROR OCCURRED IN COMPUTING THE TOTAL LUMP-SUM BID AS SHOWN ON THE
WORKSHEET. SOUTHWEST CLAIMS THAT A SUBCONTRACTOR, BLEVINS ASPHALT CO.,
MT. VERNON, MISSOURI, TELEPHONED APPROXIMATELY 1 HOUR BEFORE SOUTHWEST
MAILED ITS BID, ADVISING THAT ITS QUOTE FOR THE ASPHALT PAVING WAS BEING
RAISED FROM $4,100 TO $6,200. BLEVINS CONTENDED IT HAD MISUNDERSTOOD
THE ASPHALT THICKNESS REQUIREMENTS AND ITS ORIGINAL QUOTE WAS BASED ON A
1-INCH THICKNESS WHILE THE CONTRACT IN QUESTION REQUIRED A 3-INCH
THICKNESS. SOUTHWEST, IN ITS HASTE TO MAIL THE BID, INADVERTENTLY
SUBTRACTED THE $2,100 IN ADDITIONAL COSTS FOR ASPHALT WHEN IT SHOULD
HAVE BEEN ADDED. THIS RESULTED IN THE BID BEING $4,200 LOWER THAN
SOUTHWEST HAD INTENDED. THE CONTRACTING OFFICER, AFTER CAREFUL REVIEW
OF ALL AVAILABLE FACTS AND EVIDENCE, FELT THAT SOUTHWEST DID, IN FACT,
MAKE AN ERROR IN ARITHMETIC AND CONCLUDED THAT ITS REQUEST FOR AN UPWARD
ADJUSTMENT OF $4,200 WAS VALID.
YOU PROTEST THE PROPOSED AWARD OF A CONTRACT TO SOUTHWEST CONTENDING
THAT THE AMOUNT OF THE INTENDED BID HAS NOT BEEN SATISFACTORILY
ESTABLISHED BY SOUTHWEST.
IN REGARD TO MISTAKES IN BIDS ALLEGED AFTER OPENING AND PRIOR TO
AWARD, SECTION 1-2.406-3 (A) (2) OF THE FEDERAL PROCUREMENT REGULATIONS
(FPR) PROVIDES AS FOLLOWS:
"/2) A DETERMINATION MAY BE MADE PERMITTING THE BIDDER TO CORRECT HIS
BID WHERE THE BIDDER REQUESTS PERMISSION TO DO SO AND CLEAR AND
CONVINCING EVIDENCE ESTABLISHES BOTH THE EXISTENCE OF A MISTAKE AND THE
BID ACTUALLY INTENDED. * * *"
THE QUESTION FOR DETERMINATION, THEREFORE, IS WHETHER THE EVIDENCE OF
RECORD ESTABLISHED THAT AN ERROR ACTUALLY WAS MADE BY SOUTHWEST, AS
ALLEGED, AND WHETHER THE AMOUNT OF THE INTENDED BID HAS BEEN
SATISFACTORILY ESTABLISHED.
THE CONTRACTING OFFICER CONCLUDED AFTER A CAREFUL REVIEW OF THE
EVIDENCE THAT THE REQUIREMENTS OF FPR SEC. 1-2.406-3 (A) (2) WERE MET BY
SOUTHWEST. UPON OUR REVIEW OF THE RECORD, WE CONCLUDE THAT THE
EXISTENCE OF A MISTAKE IN BID IS CLEARLY EVIDENT AND THAT THE EVIDENCE
ESTABLISHES BOTH THE NATURE OF THE MISTAKE AND THE BID INTENDED BY
SOUTHWEST.
THE AUTHORITY CONTAINED IN FPR SEC. 1-2.406.3 (A) TO MAKE CORRECTIONS
SUCH AS HERE INVOLVED WAS GRANTED AND IS MATERIALLY CONSISTENT WITH OUR
OFFICE DECISION OF JUNE 29, 1954, B-120281. THE QUESTION WHETHER A
BIDDER MAY CHANGE A BID AFTER OPENING BECAUSE OF MISTAKE THEREIN ALWAYS
PRESENTS A MATTER OF SERIOUS CONCERN. IN ORDER TO AUTHORIZE CORRECTION
OF A BID, THE BIDDER MUST FURNISH EVIDENCE WHICH CONCLUSIVELY
ESTABLISHES NOT ONLY THE EXISTENCE OF THE MISTAKE, BUT ITS NATURE, HOW
IT OCCURRED, AND WHAT THE BIDDER ACTUALLY INTENDED TO BID. THE FORM OF
SUCH EVIDENCE NECESSARILY WILL VARY WITH THE CIRCUMSTANCES OF EACH CASE,
BUT THE EVIDENCE NECESSARILY MUST BE THE BEST AVAILABLE. SINCE THE
AUTHORITY TO CORRECT MISTAKES ALLEGED AFTER OPENING BUT PRIOR TO AWARD
IS VESTED IN THE PROCUREMENT AGENCY BY REGULATION, THE WEIGHT TO BE
GIVEN EVIDENCE IN SUPPORT OF AN ALLEGED MISTAKE IS A QUESTION OF FACT TO
BE CONSIDERED BY THE ADMINISTRATIVELY DESIGNATED EVALUATOR OF THE
EVIDENCE. WE PERCEIVE OF NO LEGAL BASIS TO CONCLUDE THAT THE EVIDENCE
SUBMITTED HERE WAS NOT SUFFICIENTLY CLEAR AND CONVINCING TO WARRANT
CORRECTION OF THE BID. B-152145, OCTOBER 4, 1963; B-163919, APRIL 29,
1968; 41 COMP. GEN. 469 (1962).
ACCORDINGLY, SINCE SOUTHWEST'S BID AS CORRECTED WILL STILL BE THE
LOWEST BID RECEIVED, WE FIND NO LEGAL BASIS TO OBJECT TO AN AWARD TO
SOUTHWEST IF OTHERWISE PROPER.
B-167960, OCT. 23, 1969
PAY--RETIRED--ANNUITY ELECTIONS FOR DEPENDENTS--ANNULMENT OF WIDOW'S
REMARRIAGE
OFFICER'S WIDOW WHO RECEIVED ANNUITY PAYMENTS UNDER RETIRED
SERVICEMAN'S FAMILY PROTECTION PLAN, 10 U.S.C. 1431-1446, THROUGH MAR.
31, 1965 WHEN ANNUITY CEASED BECAUSE OF HER MARRIAGE ON APR. 17, 1965,
IS ENTITLED TO HAVE ANNUITY REESTABLISHED FROM TIME OF DISCONTINUANCE
FOR, WHILE VALIDITY OF MARRIAGE IS DETERMINED BY LAW OF PLACE WHERE IT
WAS CONTRACTED, UNDER NEVADA LAW MARRIAGE MAY BE ANNULLED ON GROUNDS OF
FRAUD AND IF FRAUD IS PROVEN SHALL BE VOID FROM TIME COURT OF COMPETENT
AUTHORITY DECLARES MARRIAGE A NULLITY AND SINCE KANSAS ANNULMENT ON
GROUNDS OF FRAUDULENT CONTRACT SET ASIDE AND DECLARED VOID MARRIAGE
ENTERED INTO IN NEVADA, MARRIAGE IS VOID AB INITIO, CLAIMANT REMAINING
UNREMARRIED WIDOW ENTITLED TO ANNUITY PAYMENTS.
TO MAJOR R. W. TUDOR:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 6, 1969, WHICH
WAS FORWARDED HERE BY LETTER DATED SEPTEMBER 22, 1969, OF THE OFFICE OF
THE COMPTROLLER OF THE ARMY, REQUESTING AN ADVANCE DECISION AS TO THE
PROPRIETY OF PAYMENT ON A VOUCHER FOR $1,835.73 IN FAVOR OF ANNABELLE B.
MCFADDEN, AS UNREMARRIED WIDOW OF LIEUTENANT COLONEL CHARLES A.
MCFADDEN, 060175, RETIRED, DECEASED, COVERING PAYMENT OF AN ANNUITY
UNDER THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN FOR THE PERIOD
FROM APRIL 1, 1967, THROUGH JUNE 30, 1969. YOUR REQUEST HAS BEEN
ASSIGNED DO-A NO. 1050 BY THE DEPARTMENT OF DEFENSE MILITARY PAY AND
ALLOWANCE COMMITTEE.
ON JUNE 4, 1959, COLONEL MCFADDEN MADE A VALID ELECTION OF OPTION 1,
COMBINED WITH OPTION 4, AT ONE-EIGHTH OF HIS REDUCED RETIRED PAY TO
PROVIDE AN ANNUITY FOR HIS WIDOW, AFTER HIS DEATH IN A RETIRED STATUS,
UNDER THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953, NOW RETIRED
SERVICEMAN'S FAMILY PROTECTION PLAN, 10 U.S.C. 1431-1446. HE WAS
RETIRED BY REASON OF PERMANENT DISABILITY ON MARCH 15, 1962, AND DIED ON
MARCH 19, 1962.
AN ANNUITY IN THE AMOUNT OF $67.99 PER MONTH WAS ESTABLISHED IN FAVOR
OF MRS. MCFADDEN EFFECTIVE MARCH 1, 1962, AND PAYMENTS WERE MADE TO HER
THROUGH MARCH 31, 1965. HER ENTITLEMENT TO THE ANNUITY CEASED AS OF
THAT DATE UNDER 10 U.S.C. 1434 (A) (1) BECAUSE OF HER MARRIAGE TO WALTER
P. MAUS AT LAS VEGAS, NEVADA, ON APRIL 17, 1965.
A PETITION FOR ANNULMENT ON THE GROUNDS OF FRAUDULENT CONTRACT AND
DURESS WAS FILED BY MRS. ANNABELLE B. MAUS ON MARCH 10, 1967, IN THE
DISTRICT COURT OF LEAVENWORTH COUNTY, KANSAS. MR. MAUS APPEARED
PERSONALLY IN THAT ACTION. ON JULY 22, 1968, THE COURT DECREED THAT
MARRIAGE "ENTERED INTO ON APRIL 17, 1965 AT LAS VEGAS, NEVADA, BE AND
THE SAME IS HEREBY ANNULLED, SET ASIDE, DECLARED VOID, AND HELD FOR
NAUGHT, AND THE PLAINTIFF BE AND IS HEREBY RESTORED TO HER FORMER NAME,
ANNABELLE BROOKS MCFADDEN.'
ON THE BASIS OF THE DECREE OF ANNULMENT MRS. MCFADDEN REQUESTED
REINSTATEMENT OF HER ANNUITY AS UNREMARRIED WIDOW OF COLONEL MCFADDEN.
SINCE YOU STATE THAT UNDER THE LAWS OF THE STATE OF NEVADA THE GROUNDS
FOR WHICH ANNULMENT WAS GRANTED BY THE KANSAS COURT WOULD ONLY HAVE
RENDERED THE MARRIAGE VOIDABLE, YOU HAVE EXPRESSED DOUBT AS TO WHETHER
THE DECREE OF THE KANSAS COURT IS SUFFICIENT TO RENDER THE MARRIAGE VOID
AND, IF SO, YOU ASK THE DATE ON WHICH THE ANNUITY PAYMENTS SHOULD BE
ESTABLISHED.
UNDER THE LAW OF THE STATE OF NEVADA, WHERE THE ALLEGED MARRIAGE TOOK
PLACE, A MARRIAGE MAY BE ANNULLED ON THE GROUNDS OF FRAUD AND IF THE
CONSENT OF EITHER PARTY WAS OBTAINED BY FRAUD, AND FRAUD HAS BEEN
PROVED, THE MARRIAGE SHALL BE VOID FROM THE TIME ITS NULLITY SHALL BE
DECLARED BY A COURT OF COMPETENT AUTHORITY. SECTIONS 125.300 AND
125.340, NEVADA REVISED STATUTES. IN THE STATE OF KANSAS, WHERE THE
PETITION FOR ANNULMENT WAS FILED, THE DISTRICT COURT MAY GRANT A DECREE
OF ANNULMENT OF ANY MARRIAGE FOR FRAUDULENT CONTRACT OR WHERE THE
MARRIAGE IS VOID FOR ANY REASON. SECTION 60-1602, KANSAS STATUTES
ANNOTATED. UNDER KANSAS LAW A COURT MAY ENTER AN ANNULMENT DECREE THAT
RELATES BACK TO DATE OF MARRIAGE SO AS TO RENDER A VOIDABLE MARRIAGE
VOID FROM ITS INCEPTION. JOHNSON COUNTY NATIONAL BANK AND TRUST
COMPANY, V BACH, 369 P.2D 231 (1962) AND BURNETT V BURNETT, 387 P.2D 195
(1963).
IT IS THE GENERAL RULE THAT THE VALIDITY OF A MARRIAGE IS DETERMINED
BY THE LAW OF THE PLACE WHERE IT IS CONTRACTED. SEE 37 COMP. GEN. 188
(1957), AND CASES THERE CITED. IT IS ALSO THE GENERAL RULE THAT AN
ANNULMENT DECREE RENDERS THE SUPPOSED MARRIAGE VOID FROM THE BEGINNING.
SEE 55 C.J.S. 951, NOTE 54. SEE ALSO MCDONALD V MCDONALD, 58 P.2D 163
(1936); FOLSOM V PEARSALL, 245 F.2D 562 (1952), AND STARACE V
CELEBREZE, 233 F.SUPP. 452 (1964). HOWEVER, IN CERTAIN INSTANCES, THE
STATUTES TEND TO RECOGNIZE THAT AN ANNULLED MARRIAGE HAS SUFFICIENT
STATUS TO SUPPORT CERTAIN RIGHTS FLOWING FROM THE "MARRIAGE.' SEE HAHN V
GRAY, 203 F.2D 625 (1953); NOTT V FOLSOM, 161 F.SUPP. 905 (1958);
GLOSS V RAILROAD RETIREMENT BOARD, 313 F.2D 568 (1962), AND SADOWITZ V
CELEBREZE, 226 F.SUPP. 430 (1964).
WHILE IT DOES NOT APPEAR THAT THE NEVADA COURTS HAVE EVER INTERPRETED
SECTION 125.340, NEVADA REVISED STATUTES, THE UNITED STATES DISTRICT
COURT, NORTHERN DISTRICT OF CALIFORNIA, SOUTHERN DIVISION, SAID, IN THE
CASE OF SANTUELLI V FOLSOM, 165 F.SUPP. 224 (1958), THAT SINCE A VOID
MARRIAGE IS A NULLITY UNDER NEVADA LAW FROM ITS INCEPTION, A VOIDABLE
MARRIAGE BECOMES VOID AB INITIO WHEN "A COURT OF COMPETENT AUTHORITY"
ENTERS ITS DECREE OF ANNULMENT. IN THE CASE OF THURBER V UNITED STATES,
CIVIL ACTION NO. 5729, UNITED STATES DISTRICT COURT FOR THE WESTERN
DISTRICT OF WASHINGTON, NORTHERN DIVISION (1963), INVOLVING THE
ANNULMENT IN NEVADA ON THE GROUND OF FRAUD OF A MARRIAGE CELEBRATED IN
HAWAII, THE COURT HELD, CITING FOLSOM V PEARSALL, SUPRA, THAT THE
PLAINTIFF WAS ENTITLED TO REINSTATEMENT OF ANNUITY UNDER THE RETIRED
SERVICEMAN'S FAMILY PROTECTION PLAN, FROM THE TIME IT WAS DISCONTINUED,
THUS CONCLUDING, IN EFFECT, THAT SHE HAD NOT REMARRIED WITHIN THE
MEANING OF 10 U.S.C. 1434 (A) (1). A SIMILAR CONCLUSION WAS REACHED IN
HOLLAND V RIBICOFF, 219 F.SUPP. 274 (1962), INVOLVING THE SOCIAL
SECURITY LAWS.
UNDER THE CIRCUMSTANCES, AND SINCE THE KANSAS COURT "ANNULLED, SET
ASIDE, DECLARED VOID, AND HELD FOR NAUGHT" THE MARRIAGE ENTERED INTO ON
APRIL 17, 1965, THE DECREE MAY BE ACCEPTED AS ESTABLISHING THAT MRS.
MCFADDEN REMAINS THE UNREMARRIED WIDOW OF COLONEL MCFADDEN. ACCORDINGLY,
SHE IS ENTITLED TO HAVE HER ANNUITY REESTABLISHED AND PAID BEGINNING
WITH THE MONTH OF APRIL 1965.
THE VOUCHER, WHICH IS RETURNED HEREWITH, MAY BE PAID UPON AMENDMENT
TO INCLUDE ANNUITY AT THE RATE OF $67.99 PER MONTH FROM APRIL 1, 1965,
TO MARCH 31, 1967, OR AN ADDITIONAL AMOUNT OF $1,631.76.
B-167987, OCT. 23, 1969
TRAVEL EXPENSES--TRANSFERS--GOVERNMENT V EMPLOYEE
INTEREST--REDUCTION-IN-FORCE
CLAIM FOR TRANSFER COSTS BY FORMER GOVERNMENT EMPLOYEE WHO SOUGHT
EMPLOYMENT WITH FOREST SERVICE NEAR FAMILY HOME WHICH HE ACCEPTED AFTER
LEARNING AIR FORCE POSITION WOULD BE SUBJECT TO REDUCTION-IN-FORCE
ACTION WITH UNDERSTANDING THAT TRANSFER COSTS WOULD NOT BE PAID BY
FOREST SERVICE, AND WHO LEFT TO ENTER PRIVATE BUSINESS AFTER 3 MONTHS,
IS DENIED, SINCE PAYMENT OF TRANSFER EXPENSES UNDER 5 U.S.C. 5724,
WHETHER OR NOT INCIDENT TO A REDUCTION-IN-FORCE, MUST BE APPROVED BY
AGENCY HEAD AND BASED ON DETERMINATION THAT TRANSFER WAS FOR CONVENIENCE
OF GOVERNMENT; EVEN THOUGH IT MIGHT HAVE BEEN DETERMINED EMPLOYEE WAS
ENTITLED TO TRANSFER EXPENSES RETENTION OF SUCH BENEFITS WOULD BE
DEPENDENT UPON HIS REMAINING IN GOVERNMENT SERVICE FOR 12 MONTHS
FOLLOWING TRANSFER, AND RESIGNATION PRIOR TO THAT TIME WOULD RESULT IN
LIABILITY FOR REFUND.
TO MR. OSCAR G. ADAMS, JR.:
WE REFER TO YOUR LETTER OF SEPTEMBER 27, 1969, FORWARDED HERE BY
CONGRESSMAN GILLESPIE V MONTGOMERY, BY WHICH YOU REQUEST REVIEW OF THE
OFFICE SETTLEMENT OF NOVEMBER 29, 1968, WHICH DISALLOWED YOUR CLAIM FOR
REIMBURSEMENT OF THE EXPENSES YOU INCURRED IN TRANSFERRING FROM A
POSITION WITH THE DEPARTMENT OF THE AIR FORCE IN SUNNYMEAD, CALIFORNIA,
TO A POSITION WITH THE FOREST SERVICE, DEPARTMENT OF AGRICULTURE, IN
HATTIESBURG, MISSISSIPPI, IN DECEMBER 1967.
SHORTLY BEFORE YOUR TRANSFER YOU CONTACTED THE FOREST SERVICE SEEKING
EMPLOYMENT IN MISSISSIPPI FOR THE REASON THAT YOU WISHED TO RETURN TO
THE AREA OF YOUR FAMILY HOME. YOU WERE OFFERED A POSITION IN A LOWER
GRADE UNDER THE CONDITION THAT THE GOVERNMENT WOULD NOT PAY THE EXPENSES
OF YOUR MOVE TO MISSISSIPPI. YOU SAY YOU DID NOT WISH TO ACCEPT THAT
OFFER IN VIEW OF THE DECREASE IN PAY AND THE EXTRA COSTS WHICH WOULD
HAVE BEEN INVOLVED. HOWEVER, IN DECEMBER 1967 YOU WERE ADVISED BY THE
AIR FORCE IN SUNNYMEAD THAT YOUR POSITION WOULD BE SUBJECT TO
REDUCTION-IN-FORCE ACTION IN THE NEAR FUTURE AND IN VIEW THEREOF YOU
ACCEPTED THE POSITION OFFERED BY THE FOREST SERVICE AND MOVED YOUR
FAMILY TO HATTIESBURG, MISSISSIPPI. ALTHOUGH THE FOREST SERVICE
SPECIFICALLY ADVISED YOU THAT IT WOULD NOT AUTHORIZE YOUR TRANSFER TO
HATTIESBURG AT GOVERNMENT EXPENSE, YOU SAY THAT THE DEPARTMENT OF THE
AIR FORCE ADVISED YOU THAT YOU WOULD BE ENTITLED TO REIMBURSEMENT OF
ALLOWABLE EXPENSES BECAUSE OF THE REDUCTION IN FORCE WHICH WAS PENDING
AT THE TIME YOU WERE SEPARATED FROM YOUR POSITION WITH THAT AGENCY.
5 U.S.C. 5724 WHICH CONTAINS THE BASIC AUTHORITY FOR PAYMENT BY THE
GOVERNMENT OF THE COSTS OF TRANSFERRING AN EMPLOYEE FROM ONE OFFICIAL
STATION TO ANOTHER PROVIDES THAT THE EXPENSES INVOLVED MAY BE PAID ONLY
WHEN AUTHORIZED OR APPROVED BY THE HEAD OF THE AGENCY INVOLVED.
FURTHER, SUBSECTION (H) OF THAT SECTION PROVIDES:
"/H) WHEN A TRANSFER IS MADE PRIMARILY FOR THE CONVENIENCE OR BENEFIT
OF AN EMPLOYEE, INCLUDING AN EMPLOYEE IN THE FOREIGN SERVICE OF THE
UNITED STATES, OR AT HIS REQUEST, HIS EXPENSES OF TRAVEL AND
TRANSPORTATION AND THE EXPENSES OF TRANSPORTING, PACKING, CRATING,
TEMPORARILY STORING, DRAYING, AND UNPACKING OF HOUSEHOLD GOODS AND
PERSONAL EFFECTS MAY NOT BE ALLOWED OR PAID FROM GOVERNMENT FUNDS.'
ALTHOUGH WE HAVE HELD THAT AN EMPLOYEE WHO IS TRANSFERRED INSTEAD OF
BEING SEPARATED IN A REDUCTION IN FORCE MAY -- WITHIN THE AGENCY'S
DISCRETION -- BE REIMBURSED THE COSTS OF HIS TRANSFER TO THE POSITION
WHICH IS AVAILABLE TO HIM UNDER REDUCTION-IN-FORCE PROCEDURES, WE HAVE
NOT HELD THAT AN EMPLOYEE WHO IS SUBJECT TO A REDUCTION IN FORCE IS
ENTITLED TO BE TRANSFERRED AT GOVERNMENT EXPENSE TO ANY POSITION HE MAY
FIND IN THE GOVERNMENT SERVICE. SEE 26 COMP. GEN. 684, 34 ID. 313.
ACCORDINGLY, WHETHER OR NOT A REDUCTION IN FORCE WAS INVOLVED, YOUR
ENTITLEMENT TO REIMBURSEMENT OF THE COSTS OF TRANSFER IS DEPENDENT ON A
DETERMINATION UNDER 5 U.S.C. 5724 THAT THE TRANSFER WAS FOR THE
CONVENIENCE OF THE GOVERNMENT AND NOT PRIMARILY FOR YOUR BENEFIT OR AT
YOUR REQUEST. IN ANY EVENT, PAYMENT FOR EXPENSES COVERED BY 5 U.S.C.
5724 IS AUTHORIZED ONLY IF AUTHORIZED OR APPROVED BY THE ADMINISTRATIVE
OFFICE CONCERNED. SINCE THE FOREST SERVICE HAS NOT AND DID NOT INTEND
TO AUTHORIZE REIMBURSEMENT OF EXPENSES IN CONNECTION WITH YOUR TRANSFER,
AND HAS NOT APPROVED REIMBURSEMENT THEREOF, YOU ARE NOT ENTITLED TO
REIMBURSEMENT OF THOSE EXPENSES.
REGARDING THE PROVISIONS OF THE ACT OF JULY 21, 1966, PUBLIC LAW
89-516, WHICH RELATE TO EMPLOYEE TRANSFERS IN CONNECTION WITH A
REDUCTION-IN-FORCE ACTION, SECTION 26 OF THE ADMINISTRATIVE EXPENSES ACT
OF 1946, AS ADDED BY THAT ACT, NOW 5 U.S.C. 5724 (E), AUTHORIZES THE
LOSING AND GAINING AGENCIES TO SHARE THE COSTS OF AN EMPLOYEE'S TRANSFER
BETWEEN AGENCIES WHICH RESULTS FROM A REDUCTION IN FORCE ON SUCH BASIS
AS MAY BE AGREED UPON BY THE AGENCIES CONCERNED. THAT AUTHORITY,
LIKEWISE, IS A DISCRETIONARY ONE. THERE IS NO EVIDENCE OF RECORD HERE
INDICATING ANY INTENT BY THE AGENCIES CONCERNED TO USE SUCH AUTHORITY.
THEREFORE, THAT PROVISION FURNISHES NO BASIS FOR PAYMENT OF YOUR CLAIM.
ONE OTHER PROVISION OF LAW WHICH WAS CONSIDERED IN THE SETTLEMENT OF
YOUR CLAIM WAS THAT CONTAINED IN 5 U.S.C. 5724 (I) WHICH IS AS FOLLOWS:
"/I) AN AGENCY MAY PAY TRAVEL AND TRANSPORTATION EXPENSES (INCLUDING
STORAGE OF HOUSEHOLD GOODS AND PERSONAL EFFECTS) AND OTHER RELOCATION
ALLOWANCES UNDER THIS SECTION AND SECTIONS 5724A AND 5726 (C) OF THIS
TITLE WHEN AN EMPLOYEE IS TRANSFERRED WITHIN THE CONTINENTAL UNITED
STATES ONLY AFTER THE EMPLOYEE AGREES IN WRITING TO REMAIN IN THE
GOVERNMENT SERVICE FOR 12 MONTHS AFTER HIS TRANSFER, UNLESS SEPARATED
FOR REASONS BEYOND HIS CONTROL THAT ARE ACCEPTABLE TO THE AGENCY
CONCERNED. IF THE EMPLOYEE VIOLATES THE AGREEMENT, THE MONEY SPENT BY
THE UNITED STATES FOR THE EXPENSES AND ALLOWANCES IS RECOVERABLE FROM
THE EMPLOYEE AS A DEBT DUE THE UNITED STATES.' UNDER THAT PROVISION,
REGARDLESS OF YOUR INITIAL ENTITLEMENT TO REIMBURSEMENT OF TRANSFER
EXPENSES, YOUR RETENTION OF THOSE BENEFITS WOULD HAVE DEPENDED UPON YOUR
REMAINING IN GOVERNMENT SERVICE FOR 12 MONTHS FOLLOWING YOUR TRANSFER
UNLESS SEPARATED FOR REASONS BEYOND YOUR CONTROL AND ACCEPTABLE TO THE
FOREST SERVICE. YOU WERE SEPARATED FROM THE FOREST SERVICE
APPROXIMATELY 3 MONTHS AFTER YOUR TRANSFER IN ORDER TO ENTER BUSINESS
FOR YOURSELF. IN THE ABSENCE OF A DETERMINATION THAT THE SEPARATION WAS
FOR REASONS BEYOND YOUR CONTROL AND ACCEPTABLE TO THE FOREST SERVICE,
YOUR RESIGNATION WOULD HAVE MADE YOU LIABLE FOR REFUND OF ANY AMOUNT
PAID IN CONNECTION WITH YOUR TRANSFER. IN THE CIRCUMSTANCES, ANY
DETERMINATION THAT YOU MIGHT HAVE BEEN ENTITLED TO REIMBURSEMENT OF
TRANSFER EXPENSES WOULD BE COUNTERBALANCED BY THE FACT THAT YOU WOULD
NOT BE ENTITLED TO RETAIN SUCH BENEFITS BECAUSE OF YOUR FAILURE TO
REMAIN IN GOVERNMENT SERVICE FOR THE STATED PERIOD OF TIME.
FOR THE REASONS STATED, THE SETTLEMENT OF THE CLAIMS DIVISION OF THIS
OFFICE DISALLOWING YOUR CLAIM IS SUSTAINED.
B-163345, OCT. 22, 1969
TRAVEL EXPENSES--TRANSFERS--GOVERNMENT V. EMPLOYEE
INTEREST--REIMBURSEMENT BASIS
WHERE EMPLOYEE WAS APPOINTED TO OFFICE OF ECONOMIC OPPORTUNITY (OEO)
FOLLOWING HIS RESIGNATION FROM AGENCY OF INTERNATIONAL TRANSPORTATION
EXPENSES FROM SAIGON TO LOS ANGELES, CALIF; FORMER DEVELOPMENT (AID)
WHILE ON HOME LEAVE, AND WAS ALLOWED TRAVEL AND PLACE OF ACTUAL
RESIDENCE BEFORE APPOINTMENT TO AID AND DUTY STATION WITH OEO AT TIME OF
EMPLOYMENT, SETTLEMENT DENYING TRAVEL EXPENSES FROM SELECTED PLACE OF
HOME LEAVE (TOLEDO, OHIO) TO LOS ANGELES, INCIDENT TO ACCEPTANCE OF
APPOINTMENT WITH OEO, IS SUSTAINED SINCE EMPLOYEE'S SIGNED STATEMENT
PERSUASIVELY INDICATES THAT CHANGE OF EMPLOYMENT WAS AT HIS REQUEST,
AND, NOTWITHSTANDING FINDING OF "ADVANTAGE" BY OEO, SUGGESTS EMPLOYMENT
WAS PRIMARILY FOR EMPLOYEE'S CONVENIENCE OR BENEFIT WITHIN MEANING OF 5
U.S.C. 5724 (H).
TO MR. ROBERT C. SLONAGER:
THIS REFERS TO YOUR LETTER OF SEPTEMBER 2, 1969, REQUESTING
RECONSIDERATION OF OUR SETTLEMENT OF MARCH 6, 1968, WHICH DISALLOWED
YOUR CLAIM FOR TRAVEL AND TRANSPORTATION EXPENSES ALLEGED TO BE DUE
UNDER THE TRANSFER OF STATION PROVISIONS OF 5 U.S.C. 5724 AND 5724A, IN
CONNECTION WITH YOUR APPOINTMENT TO THE OFFICE OF ECONOMIC OPPORTUNITY
(OEO) FOLLOWING YOUR RESIGNATION FROM THE AGENCY FOR INTERNATIONAL
DEVELOPMENT (AID).
THE FACTS IN YOUR CASE WERE FULLY SET FORTH IN OUR SETTLEMENT OF
MARCH 6, 1968, AND NEED NOT BE REPEATED HERE. YOUR CLAIM WAS DISALLOWED
BY OUR SETTLEMENT OF MARCH 6, 1968, SINCE YOUR CHANGE FROM AID TO OEO
WAS PRIMARILY FOR YOUR CONVENIENCE OR BENEFIT AND THERE WAS NO TRANSFER
BETWEEN YOUR OFFICIAL STATIONS WITH AID, SAIGON, AND OEO, LOS ANGELES,
CALIFORNIA, BUT THAT THE TRAVEL AND TRANSPORTATION INVOLVED, IN FACT,
WAS FROM YOUR SELECTED PLACE OF HOME LEAVE (TOLEDO, OHIO) TO LOS
ANGELES.
SECTION 1.3 OF BUREAU OF THE BUDGET CIRCULAR NO. A-56, REVISED
OCTOBER 12, 1966, PROVIDES IN PART AS FOLLOWS:
"A. ELIGIBILITY CONDITIONS. WHEN AUTHORIZED OR APPROVED BY SUCH
OFFICIAL OR OFFICIALS AS THE HEAD OF THE DEPARTMENT MAY DESIGNATE,
TRAVEL AND TRANSPORTATION EXPENSES AND APPLICABLE ALLOWANCES AS PROVIDED
IN THESE REGULATIONS SHALL BE PAID IN THE CASE OF (1) TRANSFER OF AN
EMPLOYEE IN THE INTEREST OF THE GOVERNMENT FROM ONE OFFICIAL STATION TO
ANOTHER FOR PERMANENT DUTY, BUT IN NO CASE IN WHICH THE TRANSFER IS
PRIMARILY FOR THE CONVENIENCE OR BENEFIT OF THE EMPLOYEE OR AT HIS OWN
REQUEST * * *".
THE QUOTED PROVISION CONTEMPLATES REIMBURSEMENT TO AN EMPLOYEE FOR
THE COST OF TRANSPORTING HIS FAMILY AND HOUSEHOLD GOODS WHEN SUCH
TRANSPORTATION IS INCIDENT TO A CHANGE OF OFFICIAL STATION NECESSITATED
BY EXIGENCIES OF THE SERVICE. THE AGENCY FOR INTERNATIONAL DEVELOPMENT
SEPARATION DOCUMENT OF NOVEMBER 1967 INDICATES THAT BECAUSE OF YOUR
FAILURE TO RETURN TO SAIGON AFTER HOME LEAVE, YOU WERE CONSTRUCTIVELY
SEPARATED FROM THAT AGENCY FOR TRAVEL AND TRANSPORTATION PURPOSES AT
YOUR FORMER PLACE OF ACTUAL RESIDENCE IN LOS ANGELES, A DETERMINATION
WHICH WOULD CONSTRUCTIVELY PLACE YOU IN LOS ANGELES AT THE TIME OF YOUR
HIRE BY OEO.
AS STATED BY YOU IT MAY BE THAT OEO HAD A PARTICULAR INTEREST IN
OBTAINING YOUR SERVICES. WE NOTE IN THAT REGARD THAT OEO IN STANDARD
FORM 50, DATED OCTOBER 14, 1966, AUTHORIZED PAYMENT OF YOUR TRAVEL AND
TRANSPORTATION EXPENSES "AS ADVANTAGEOUS TO THE GOVERNMENT.' HOWEVER, IN
YOUR SIGNED STATEMENT OF APRIL 17, 1967, YOU SAY IN PART AS FOLLOWS:
"MAJOR SURGERY AND OTHER PERSONAL FACTORS CAUSED A CHANGE IN PLANS. I
CONTACTED OEO FOR EMPLOYMENT AND WAS ADVISED IN EARLY AUGUST OF A FIRM
JOB OFFER WITH THE OFFICE OF INSPECTION IN THE LOS ANGELES AREA.'
THAT STATEMENT PERSUASIVELY INDICATES THAT THE CHANGE IN EMPLOYMENT
FROM AID TO OEO WAS "AT YOUR REQUEST" AND, NOTWITHSTANDING A FINDING OF
"ADVANTAGE" BY OEO, SUGGESTS THE EMPLOYMENT WAS PRIMARILY FOR YOUR
CONVENIENCE OR BENEFIT WITHIN THE MEANING OF 5 U.S.C. 5724 (H).
ASSUMING THE VALIDITY OF YOUR VIEW THAT SAIGON WAS YOUR OFFICIAL
STATION AT THE TIME OF YOUR EMPLOYMENT WITH OEO, THE FACT REMAINS THAT
AID HAS ALLOWED YOU AN AMOUNT WHICH EQUALS OR EXCEEDS THE COST OF THE
TRAVEL AND TRANSPORTATION FROM SAIGON TO LOS ANGELES, YOUR DUTY STATION
WITH OEO AT TIME OF YOUR EMPLOYMENT WITH THAT AGENCY. WE ARE NOT AWARE
OF ANY AUTHORITY FOR PAYMENT OF THE ADDITIONAL TRAVEL AND TRANSPORTATION
EXPENSES INCURRED FOR TRAVEL FROM TOLEDO TO LOS ANGELES INCIDENT TO
ACCEPTANCE OF YOUR APPOINTMENT WITH OEO.
ACCORDINGLY, WE MUST SUSTAIN THE ACTION TAKEN IN OUR SETTLEMENT OF
MARCH 6, 1968, IN DISALLOWING YOUR CLAIM.
B-164473, OCT. 22, 1969
BIDS--ALTERNATIVE--UNSOLICITED
CONCERNING REJECTED BIDDER'S CONTENTION THAT ITS LOWER PRICED
ALTERNATE PROPOSAL SHOULD HAVE BEEN ACCEPTED OVER AWARDEE'S, SINCE
EQUIPMENT HAS BEEN DELIVERED AND PAID FOR, GAO CONTEMPLATES NO FURTHER
ACTION AND PROTEST IS DENIED; HOWEVER, NASA ADMITS PROCUREMENT WAS
IMPROPERLY HANDLED AND IN ORDER TO PREVENT RECURRENCE OF SIMILAR
INCIDENTS HAS ISSUED DIRECTIVE TO ENSURE PROPER FILE DOCUMENTATION IN
CASES INVOLVING EVALUATION OF PROPOSED ALTERNATES ON PROCUREMENTS OF
$2,500 OR LESS, WHICH PROVIDES THAT WHERE OFFEROR SUBMITTING ALTERNATE
PROPOSAL FAILS TO SUBMIT ACCOMPANYING LITERATURE, GOVERNMENT BUYER SHALL
REQUEST OFFEROR TO SUBMIT SUCH LITERATURE SO THAT PROPOSAL MAY BE
PROPERLY EVALUATED; AND FUTURE SOLICITATIONS FOR SUBJECT ITEM (GAS
CHLORINATOR) WILL REQUIRE THAT ALL QUOTATIONS BE IN WRITING.
TO CAPITAL CONTROLS COMPANY, INC.:
FURTHER REFERENCE IS MADE TO YOUR LETTERS OF JUNE 25 AND JULY 11,
1969, WITH ENCLOSURES, PROTESTING THE MANNER IN WHICH THE NATIONAL
AERONAUTICS AND SPACE ADMINISTRATION (NASA), KENNEDY SPACE CENTER,
FLORIDA, HANDLED THE PROCUREMENT OF ONE GAS CHLORINATOR UNDER
"REQUISITION/PURCHASE REQUEST NO. 91152070" DATED MAY 20, 1969.
THE PURCHASE REQUEST RECEIVED BY THE PROCUREMENT OFFICE DESCRIBED THE
REQUIREMENT AS FOLLOWS: ,WALLACE AND TIERNAN MODEL V-50 NOTCH
CHLORINATOR (NO SUBSTITUTE) AS BASE NOW HAS THIS MODEL CHLORINATOR AND
THESE CAN BE INTERCHANGED IN EMERGENCY. ALSO SAME REPAIR PARTS STORED
FOR EMERGENCY.'
BECAUSE THE GOVERNMENT'S ESTIMATED COST WAS $540, THE CONTRACTING
OFFICER FOLLOWED THE SIMPLIFIED SMALL PURCHASE PROCEDURES SET FORTH IN
PARAGRAPH 3.600 OF THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
PROCUREMENT REGULATION. IN ORDER TO OBTAIN COMPETITION, THE CONTRACTING
OFFICE ELIMINATED THE BRAND NAME RESTRICTION FROM THE REQUEST FOR
QUOTATIONS (RFQ) ISSUED ON MAY 20, 1969. THE RFQ DESCRIBED THE
CHLORINATOR AS "SOLUTION FEED VACUUM OPERATED WALL MOUNTED WITH 20
LB/24 HOUR ROTAMETER AND COMPLETE WITH THE FOLLOWING ACCESSORIES.'
ELEVEN ITEMS OF ACCESSORIES WERE LISTED IN THE RFQ, WHICH WAS MAILED TO
YOUR FIRM AND WALLACE AND TIERNAN, INC. IT IS REPORTED THAT AFTER
WRITTEN QUOTATIONS WERE RECEIVED FROM YOUR FIRM AND WALLACE AND TIERNAN,
AN ORAL QUOTATION WAS SOLICITED BY TELEPHONE FROM ELECTRA-TRONICS, INC.,
A LOCAL SOURCE AT COCOA, FLORIDA, WHICH FIRM HAD BEEN ISSUED A BLANKET
PURCHASE AGREEMENT ON JULY 1, 1968, FOR ELECTRICAL AND POWER
DISTRIBUTION EQUIPMENT FOR THE PERIOD JULY 1, 1968, TO JUNE 30, 1969.
THE RECORD INDICATES THAT THE FOLLOWING QUOTATIONS WERE RECEIVED ON
THE CHLORINATOR:
COMPANY PRICE
------- ----- ELECTRA-TRONICS (OFFER
WALLACE AND TIERNAN MODEL V-50) $700 CAPITAL CONTROLS (OFFERING
775
(OFFERING AS ALTERNATE THEIR MODEL 480) (496) WALLACE AND TIER
(OFFERING THEIR MODEL A-741) 928
IT IS REPORTED THAT SINCE NO DESCRIPTIVE LITERATURE OR BROCHURES WERE
SUBMITTED BY YOUR FIRM WITH RESPECT TO YOUR MODEL 480 EQUIPMENT AND THAT
SINCE SUCH INFORMATION WAS NOT READILY AVAILABLE TO THE CONTRACTING
OFFICE, IT COULD NOT BE DETERMINED WHETHER THE MODEL 480 CHLORINATOR
OFFERED BY YOUR FIRM MET THE REQUIREMENTS OF THE SPECIFICATIONS.
HOWEVER, A HANDWRITTEN NOTATION BY THE GOVERNMENT BUYER ON THE ABSTRACT
OF QUOTATIONS STATES THAT: "ALTERNATE OFFERED BY CAPITAL CONTROLS NOT
ACCEPTABLE PER TECHNICAL REP. THIS IS SMALLER UNIT THAN REQUESTED.' ON
THE BASIS OF THE FOREGOING TECHNICAL INFORMATION, ALLEGED TO HAVE BEEN
RECEIVED BY THE GOVERNMENT BUYER, AWARD WAS MADE TO ELECTRA-TRONICS ON
MAY 28, 1969, IN THE AMOUNT OF $700, FOR A WALLACE AND TIERNAN MODEL
V-50 CHLORINATOR. PAYMENT FOR THE CHLORINATOR DELIVERED BY
ELECTRA-TRONICS WAS MADE TO THAT FIRM ON JULY 2, 1969.
IN YOUR LETTER OF JUNE 25, 1969, YOU REFER TO OUR DECISION B-164473,
AUGUST 1, 1968, TO YOU, IN WHICH WE HELD THAT THE NASA CONTRACTING
OFFICER INVOLVED IN THE PROCUREMENT OF A CHLORINATOR SHOULD NOT HAVE
ACCEPTED A LESSER PRODUCT THAN THAT SPECIFIED IN THE SOLICITATION
WITHOUT ALLOWING ALL OFFERORS AN EQUAL OPPORTUNITY TO QUOTE ON AN
EQUALLY ACCEPTABLE PRODUCT. YOU POINT OUT THAT THE LESSER PRODUCT
REFERRED TO IN THE DECISION OF AUGUST 1, 1968, WAS A WALLACE AND TIERNAN
MODEL V-50 CHLORINATOR AND THAT SUCH ITEM WAS PURCHASED FROM
ELECTRA-TRONICS AT A CONTRACT PRICE OF $540. YOU CONTEND THAT SINCE YOU
OFFERED TO FURNISH YOUR MODEL 480 CHLORINATOR AT A LOWER PRICE OF $496
AS AN ALTERNATE, YOUR ALTERNATE PROPOSAL SHOULD HAVE BEEN ACCEPTED.
YOU STATE THAT ON MAY 28, 1969 -- THE DAY FOLLOWING THE CLOSING DATE
FOR RECEIPT OF QUOTATIONS -- YOU TELEPHONED MRS. HEINEMANN OF THE
CONTRACTING OFFICE TO INQUIRE ABOUT THE SUBJECT PROCUREMENT AND THAT AS
A RESULT OF THIS TELEPHONE CONTACT YOU RECEIVED THE FOLLOWING
INTEROFFICE REPORT: "A WALLACE AND TIERNAN MODEL V-50, WHICH THEY DID
NOT KNOW THEY HAD ON THE SHELF, IS BEING USED FOR THIS JOB. ACCORDING TO
MRS. HEINEMANN, IT IS EXACTLY WHAT THEY NEED AND IS CHEAPER THAN THE
ALTERNATE THAT WE OFFERED.' IN REGARD TO THE FOREGOING STATEMENT, WHICH
HAS BEEN VEHEMENTLY DENIED BY MRS. HEINEMANN, YOU ASK THE FOLLOWING
QUESTIONS: "WHOSE SHELF WAS THE V-50 FOUND ON? WHERE DID THE $450.00
PRICE COME FROM? WAS THE V-50 OFFERED AT $450.00 AFTER THE BIDS WERE
OPENED AND AFTER OUR $496.00 PRICE WAS EXPOSED? " IN REGARD TO THE
FIRST QUESTION, THE RECORD INDICATES THAT THE WALLACE AND TIERNAN MODEL
V-50 CHLORINATOR WAS OBTAINED OFF THE SHELF FROM ELECTRA-TRONICS. AS TO
YOUR SECOND QUESTION, IT APPEARS THAT YOUR REFERENCE TO A $450 PRICE IS
IN ERROR SINCE ELECTRA-TRONICS OFFERED A V-50 MODEL FOR $540 PER UNIT IN
THE PROCUREMENT CONSIDERED IN DECISION B-164473 OF AUGUST 1, 1968.
FINALLY, ELECTRA-TRONICS DID NOT OFFER TO REDUCE ITS PRICE OF $700 TO
$450 AFTER THE PROPOSALS WERE OPENED AND, IN ANY EVENT, AWARD WAS MADE
IN THE AMOUNT OF $700.
NASA ADMITS THAT THIS PROCUREMENT WAS NOT PROPERLY HANDLED BY THE
PROCUREMENT OFFICIALS AT THE KENNEDY SPACE CENTER. IT HAS REPORTED THAT
THERE IS NO EXISTING TECHNICAL EVIDENCE IN THE FILES OF THE CENTER TO
SUPPORT THE REJECTION OF YOUR QUOTATION OFFERING YOUR MODEL 480
CHLORINATOR. NASA HAS ADVISED THAT, IN ORDER TO PREVENT A RECURRENCE OF
INCIDENTS SIMILAR TO THE ONE REFERRED TO ABOVE, THE PROCUREMENT OFFICER
AT THE CENTER HAS ISSUED "STANDARD OPERATIONS PROCEDURE NO. 18," DATED
SEPTEMBER 18, 1969, TO ENSURE PROPER FILE DOCUMENTATION BY CENTER BUYERS
IN CASES INVOLVING THE CONSIDERATION AND EVALUATION OF PROPOSED
ALTERNATES ON PROCUREMENTS OF $2,500 OR LESS. FOR YOUR INFORMATION, THE
CITED PROCUREMENT PROCEDURE DIRECTIVE PROVIDES, AMONG OTHER THINGS, THAT
WHERE AN OFFEROR SUBMITTING AN ALTERNATE PROPOSAL FAILS TO SUBMIT
DESCRIPTIVE LITERATURE WITH SUCH PROPOSAL, AS IN THE PRESENT CASE, THE
GOVERNMENT BUYER SHALL REQUEST THE OFFEROR TO SUBMIT SUCH LITERATURE SO
THAT IT MAY BE PROPERLY EVALUATED. ALSO, NASA HAS ADVISED THAT, IN VIEW
OF THE HISTORY OF THESE CHLORINATOR PROCUREMENTS, FUTURE SOLICITATIONS
FOR THE ITEM WILL REQUIRE THAT ALL QUOTATIONS BE IN WRITING.
SINCE THE EQUIPMENT HAS BEEN DELIVERED AND PAID FOR, NO FURTHER
ACTION IS CONTEMPLATED BY OUR OFFICE WITH RESPECT TO THIS PROCUREMENT.
YOUR PROTEST IS THEREFORE DENIED.
B-165906, OCT. 22, 1969
LABOR STIPULATIONS--DAVIS-BACON ACT--WAGE UNDERPAYMENTS--DISPUTED
CONCERNING GENERAL SERVICES ADMINISTRATION REQUEST FOR JUSTIFICATION
OF ACTION WITHHOLDING CONTRACTOR'S FUNDS FOR ALLEGED VIOLATIONS OF
DAVIS-BACON ACT INVOLVING QUESTION OF HOW MANY HOURS WERE WORKED BY
EMPLOYEES AS LABORERS AND HOW MANY AS MECHANICS, GAO IS NOT IN POSITION
TO DETERMINE PROPER DISTRIBUTION PENDING ADVICE OF FURTHER AGENCY ACTION
SINCE CONTRACTING OFFICER'S PURPORTED DECISION -- REFERRING SAID
QUESTION TO DEPARTMENT OF LABOR UNDER 29 CFR 5.12--- IS NOT BELIEVED TO
CONSTITUTE DECISION CONTEMPLATED BY DISPUTES CLAUSE ON COGNIZABLE
MATTERS, INASMUCH AS SAID REGULATION CANNOT BE INTERPRETED TO TRANSFER
CONTRACTING AGENCY'S DUTY TO DETERMINE FACTUAL QUESTIONS OR AFFECT
CONTRACTOR'S RIGHT TO ADMINISTRATIVE DETERMINATION THEREOF IN ACCORDANCE
WITH DISPUTES CLAUSE.
TO MR. KUNZIG:
REFERENCE IS MADE TO THE LETTER OF FEBRUARY 19, 1969, FROM YOUR
GENERAL COUNSEL IN REPLY TO OUR REQUEST FOR JUSTIFICATION FOR ACTION
TAKEN BY YOUR AGENCY CONCERNING CERTAINFUNDS WITHHELD FROM AMOUNTS
OTHERWISE DUE THE MISHARA CONSTRUCTION COMPANY, INC. (MISHARA) OF EAST
NATICK, MASSACHUSETTS, ON ACCOUNT OF ALLEGED VIOLATIONS OF THE
DAVIS-BACON ACT, 40 U.S.C. 276A, UNDER CONTRACT NO. GS-01B-PCC-0230 FOR
CONSTRUCTION OF THE U.S. BORDER STATION AT DURBY LINE, VERMONT.
THE CONTRACT WAS AWARDED ON NOVEMBER 5, 1964, WITH THE ESTIMATED
COMPLETION DATE SET AS OCTOBER 23, 1965. ON JULY 15, 1966, AFTER
COMPLETION OF THE WORK THE GENERAL SERVICES ADMINISTRATION (GSA)
NOTIFIED MISHARA THAT 11 WORKERS HAD BEEN UNDERPAID A TOTAL OF
$1,583.31. THE RECORD SHOWS THAT ON AUGUST 8, 1965, SEVEN WORKERS
COMPLAINED TO GSA THAT THEY HAD BEEN UNDERPAID. IT APPEARS THAT THESE
WORKERS HAD WORKED AS LABORERS, IRONWORKERS, CARPENTERS, CEMENT MASONS,
AND MACHINE OPERATORS, AND HAD BEEN PAID NO LESS THAN THE DAVIS-BACON
ACT MINIMUM WAGE RATES FOR THE TIMES THAT MISHARA'S RECORDS SHOWED THAT
THEY HAD WORKED AT EACH CLASSIFICATION. THE WORKERS DISAGREED WITH THE
TIMES SHOWN ON MISHARA'S RECORDS SAYING THAT THEY HAD WORKED DIFFERENT
HOURS.
BASED PRIMARILY ON THE WORKERS' STATEMENTS, WHICH WERE FOUNDED
SUBSTANTIALLY ON MERE RECOLLECTION, THE GSA COMPLIANCE DIVISION
DETERMINED THAT THE WORKERS HAD BEEN UNDERPAID AND THE PRECISE AMOUNTS
THEREOF, AND MISHARA WAS DIRECTED TO MAKE RESTITUTION IN ACCORDANCE WITH
THIS DETERMINATION. MISHARA DISAGREED WITH SUCH FINDINGS AND ATTEMPTED
TO UTILIZE THE DISPUTES PROCEDURE CONTAINED IN THE CONTRACT, WHICH
PROVIDED FOR DETERMINATION OF DISPUTED FACTS BY THE CONTRACTING OFFICER,
SUBJECT TO APPEAL TO YOU OR YOUR DESIGNATED REPRESENTATIVE.
PURSUANT THERETO ON MAY 7, 1968, MISHARA REQUESTED THAT "A
CONTRACTING OFFICER'S FINAL DECISION BE ISSUED IN THIS MATTER, FROM
WHICH WE CAN TAKE AN APPEAL.' BY LETTER DATED MAY 8, 1968, THE
CONTRACTING OFFICER MADE A CONTRACTING OFFICER'S DECISION "IN ACCORDANCE
WITH THE DISPUTES CLAUSE" AFFIRMING THE FINDINGS OF THE COMPLIANCE
DIVISION AND INFORMING MISHARA OF THEIR RIGHT TO APPEAL TO THE
ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION. THE MAY 8, 1968, LETTER
CONTAINED THE FOLLOWING STATEMENT: "THIS DECISION IS MADE IN ACCORDANCE
WITH THE DISPUTES CLAUSE AND SHALL BE FINAL AND CONCLUSIVE AS PROVIDED
THEREIN, UNLESS, WITHIN THIRTY (30) DAYS FROM THE DATE OF RECEIPT OF
THIS DECISION, A WRITTEN NOTICE OF APPEAL (IN TRIPLICATE) ADDRESSED TO
THE ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, GENERAL SERVICES
BUILDING, WASHINGTON, D.C. 20405, IS MAILED OR OTHERWISE FURNISHED TO
THE CONTRACTING OFFICER. THE NOTICE OF APPEAL, WHICH IS TO BE SIGNED BY
YOU AS THE CONTRACTOR OR BY AN ATTORNEY ACTING ON YOUR BEHALF, AND WHICH
MAY BE IN LETTER FORM, SHOULD INDICATE THAT AN APPEAL IS INTENDED,
SHOULD REFER TO THIS DECISION AND SHOULD IDENTIFY THE CONTRACT BY
NUMBER. THE NOTICE OF APPEAL MAY INCLUDE A STATEMENT OF THE REASONS WHY
THE DECISION IS CONSIDERED TO BE ERRONEOUS.'
HOWEVER, ON THE VERY NEXT DAY, MAY 9, 1968, THE CONTRACTING OFFICER
DISPATCHED THE FOLLOWING LETTER TO THE CONTRACTOR: "THIS LETTER
SUPERSEDES LETTER OF MAY 8, 1968 WHICH WAS IN REPLY TO YOUR
LETTER OF MAY 7, 1968 REQUESTING A CONTRACTING OFFICER'S DECISION IN
ACCORDANCE WITH THE DISPUTES CLAUSE OF THE REFERENCED CONTRACT.'NO NEW
EVIDENCE HAS BEEN SUBMITTED TO ALTER THE OPINION OF THE CONTRACTING
OFFICER OR THE DISPUTES REVIEW COMMITTEE.'THIS DECISION IS MADE IN
ACCORDANCE WITH PART 5, SUB TITLE A OF TITLE 29 OF CODE OF FEDERAL
REGULATIONS AND WITH THE WAGE DETERMINATION AS ESTABLISHED BY THE
DEPARTMENT OF LABOR AS INCLUDED IN THE CONTRACT SPECIFICATIONS AND SHALL
BE FINAL AND CONCLUSIVE UNLESS, WITHIN THIRTY (30) DAYS FROM RECEIPT OF
THIS DECISION, A WRITTEN NOTICE OF APPEAL (IN TRIPLICATE) ADDRESSED TO
THE SECRETARY OF LABOR, WASHINGTON, D.C. IS MAILED OR OTHERWISE
FURNISHED TO THE CONTRACTING OFFICER. THE NOTICE OF APPEAL, WHICH IS TO
BE SIGNED BY YOU AS THE CONTRACTOR OR BY AN ATTORNEY ACTING ON YOUR
BEHALF, AND WHICH MAY BE IN LETTER FORM, SHOULD INDICATE THAT AN APPEAL
IS INTENDED, SHOULD REFER TO THIS DECISION AND SHOULD IDENTIFY THE
CONTRACT BY NUMBER. THE NOTICE OF APPEAL MAY INCLUDE A STATEMENT OF THE
REASONS WHY THE DECISION IS CONSIDERED TO BE ERRONEOUS.'
UNDER SUCH CIRCUMSTANCES, ON JUNE 5, 1968, MISHARA TRANSMITTED ITS
APPEAL TO THE SECRETARY OF LABOR THROUGH GSA BY THE FOLLOWING COVERING
LETTER: "WE ARE ENCLOSING HEREWITH, IN TRIPLICATE, OUR APPEAL,
ADDRESSED TO THE SECRETARY OF LABOR, FROM YOUR FINAL DECISION DATED MAY
9, 1968 DIRECTING US TO COMPLY WITH THE FINDINGS OF YOUR COMPLIANCE
DIVISION.'AS STATED IN OUR LETTER OF APPEAL, IT IS OUR POSITION THAT THE
PROCEDURE OUTLINED IN YOUR LETTER OF MAY 9, 1968 IS NOT IN ACCORDANCE
WITH THE LAW OR THE CONTRACT, AND THE FILING OF THIS APPEAL IN NO WAY
CONSTITUTES A WAIVER OF OUR POSITION.' THE REGIONAL ADMINISTRATOR, GSA,
FORWARDED THAT LETTER TO THE SOLICITOR OF LABOR BY TRANSMITTAL LETTER
DATED JUNE 12, 1969.
ON SEPTEMBER 2K, 1968, THE ADMINISTRATOR, WAGE AND HOUR AND PUBLIC
CONTRACTS DIVISIONS, DEPARTMENT OF LABOR, WROTE TO THE DIRECTOR OF THE
COMPLIANCE DIVISION OF GSA AS FOLLOWS:
"WE DO NOT UNDERSTAND WHY THE LETTER OF MAY 8, 1968, WAS WITHDRAWN
AND SUPERSEDED BY THE LETTER OF MAY 9, 1968, WHICH INFORMED THE
CONTRACTOR OF A RIGHT TO APPEAL TO THE SECRETARY OF LABOR, SINCE
REGULATIONS, PART 5, DO NOT APPEAR TO PROVIDE FOR SUCH AN APPEAL.'
"FOR YOUR INFORMATION, WE HAVE REVIEWED THE INVESTIGATION REPORT AND
ARE IN AGREEMENT WITH THE CONCLUSIONS REACHED BY THE CONTRACTING
OFFICER. THE REPORT ADEQUATELY SUBSTANTIATES THE FACT THAT EMPLOYEES
WHO WORKED BOTH AS LABORERS AND CARPENTERS AND IRONWORKERS AND CEMENT
MASONS WERE NOT PAID THE APPROPRIATE RATES FOR ALL HOURS WORKED.
"WE WILL APPRECIATE RECEIVING YOUR REPORT AND RECOMMENDATIONS UPON
COMPLETION OF THE FURTHER ADMINISTRATIVE ACTION BY YOUR OFFICE.'
UNDER DATE OF NOVEMBER 25, 1968, HOWEVER, PRESUMABLY AS THE RESULT OF
FURTHER COMMUNICATIONS BETWEEN YOUR AGENCY AND THE DEPARTMENT OF LABOR,
THE ACTING SOLICITOR OF LABOR ADVISED MISHARA AS FOLLOWS: "UPON A
REVIEW OF THE RECORD WE CONCUR IN THE FINDINGS OF THE GENERAL SERVICES
ADMINISTRATION. DURING THE PERFORMANCE OF THE CONTRACT WORK EMPLOYEES
HIRED AS LABORERS WERE PERMITTED TO WORK VARIOUSLY AS IRONWORKERS,
CARPENTERS AND CEMENT MASONS. SINCE THEY WERE NOT CONSIDERED BY THE JOB
SUPERINTENDENT AS COMPETENT CRAFTSMAN HE INSTRUCTED THE TIMEKEEPER TO
SPLIT THE HOURS WORKED IN THESE JOURNEYMEN TRADES, ONE-HALF AT THE
PREDETERMINED JOURNEYMAN RATE AND ONE-HALF AT THE LABORERS RATE. THIS
ARBITRARY BREAKDOWN DOES NOT REFLECT THE WORK ACTUALLY PERFORMED IN EACH
CLASSIFICATION AND IS AN INADEQUATE SEGREGATION FOR PURPOSES OF
JUSTIFYING THE PAYMENT OF DIFFERING RATES.'
IT DOES NOT APPEAR FROM THE FILE FURNISHED OUR OFFICE THAT EITHER THE
COMPLAINING WORKERS OR THE COMPLIANCE DIVISION, GSA, HAD EVER CONTENDED
THAT THE HOURS WORKED HAD BEEN SPLIT ONE-HALF AT THE JOURNEYMEN RATE AND
ONE-HALF AT THE LABORERS' RATE, AND THE SUPPLEMENTAL STATEMENT OF THE
COMPLIANCE DIVISION SHOWING THE COMPUTATION OF THE ALLEGED UNDERPAYMENTS
CLEARLY SHOWS THAT THE ADJUSTMENTS MADE DID NOT ACCORD WITH THAT THEORY.
ON DECEMBER 26, 1968, MISHARA PROTESTED THE MATTER TO OUR OFFICE,
REQUESTING THAT THE CONTRACTING OFFICER BE DIRECTED TO FOLLOW THE
REQUIREMENTS OF THE DISPUTES CLAUSE OF THE CONTRACT.
YOUR GENERAL COUNSEL BY THE ABOVE REFERENCED LETTER OF FEBRUARY 19,
1969, TAKES THE POSITION THAT UNDER 29 CFR 5.12 THE LABOR DEPARTMENT HAS
MADE PROVISION FOR REFERRAL OF CERTAIN QUESTIONS TO THE DEPARTMENT FOR
APPROPRIATE RULINGS. THAT REGULATION PROVIDES THAT "ALL QUESTIONS
ARISING IN ANY AGENCY RELATING TO THE APPLICATION AND INTERPRETATION OF
THE RULES CONTAINED IN THIS PART AND IN PARTS 1 AND 3 OF THIS SUBTITLE *
* * SHALL BE REFERRED TO THE SECRETARY (LABOR) FOR APPROPRIATE RULINGS
AND INTERPRETATIONS.' WE INTERPRET THAT REGULATION TO PROVIDE FOR
GUIDANCE TO BE FURNISHED BY THE SECRETARY OF LABOR TO A CONTRACTING
AGENCY AS THE BASIS FOR ENFORCEMENT ACTION BY THE AGENCY, IN CASES OF
DOUBT OR DISPUTE AS TO CLASSIFICATIONS OR WAGE RATES APPLICABLE TO
PARTICULAR WORK. WE CANNOT INTERPRET IT AS TRANSFERRING TO THE
SECRETARY OF LABOR THE CONTRACTING AGENCY'S DUTY TO DETERMINE HOURS
WORKED BY INDIVIDUAL LABORERS AND MECHANICS IN THE SEVERAL
CLASSIFICATIONS IN WHICH THEY WERE EMPLOYED, OR AS AFFECTING A
CONTRACTOR'S RIGHT TO ADMINISTRATIVE DETERMINATION OF SUCH PURELY
FACTUAL QUESTIONS IN ACCORDANCE WITH THE DISPUTES CLAUSE OF HIS
CONTRACT.
WE FAIL TO FIND IN ANYTHING WHICH HAS BEEN SUBMITTED TO US ANY BASIS
FOR YOUR GENERAL COUNSEL'S CONTENTION THAT THE UNDERLYING QUESTION IN
ISSUE WAS WHETHER THE "PARTICULAR FUNCTIONS PERFORMED BY THE EMPLOYEES
IN QUESTION BROUGHT THEM WITHIN THE LIMITS CONSIDERED BY THE LABOR
DEPARTMENT AS CONSTITUTING THE CLASSIFICATIONS OF CARPENTER," ETC. THE
ONLY DISPUTED MATTERS REFLECTED IN THIS RECORD IS HOW MANY HOURS WERE
WORKED BY THE INDIVIDUAL EMPLOYEES AS LABORERS AND HOW MANY AS OTHER
TYPES OF WORKERS. THIS IS IN FACT PLAINLY INDICATED BY THE STATEMENT AT
THE TOP OF PAGE 2 OF THE GENERAL COUNSEL'S LETTER THAT "THE JOB
SUPERINTENDENT'S DESCRIPTION OF THE ACTUAL DUTIES PERFORMED BY THE
EMPLOYEES IN QUESTION CONFLICTED WITH THE DESCRIPTIONS FURNISHED BY THE
EMPLOYEES * * *.' IT IS NOT STATED THAT THE JOB SUPERINTENT OR THE
CONTRACTOR QUESTIONED THE CLASSIFICATION APPLICABLE TO THE WORK
DESCRIBED BY THE EMPLOYEES, OR THAT THE COMPLIANCE DIVISION QUESTIONED
THE CLASSIFICATION APPLICABLE TO THE WORK DESCRIBED BY THE JOB
SUPERINTENDENT; THE DISPUTE IS SIMPLY AS TO WHICH KIND OF WORK WAS IN
FACT BEING PERFORMED DURING THE HOURS WORKED. THE CONTRACTOR CLAIMED
THAT THE SEVERAL WORKERS EACH WERE ENGAGED IN LABORER'S WORK FOR CERTAIN
HOURS AND IN CARPENTER'S OR IRONWORKER'S WORK FOR CERTAIN OTHER HOURS,
AND HIS PAYROLL RECORDS SHOW THAT THEY WERE PAID ON THAT BASIS.
IN DETERMINING UNDERPAYMENTS THE COMPLIANCE DIVISION FOUND THAT THE
NUMBER OF HOURS RECORDED AND PAID FOR AS LABORERS WAS MORE, AND THOSE
RECORDED AS PAID FOR AS OTHER CRAFTS LESS, THAN THE HOURS ACTUALLY
WORKED IN THOSE RESPECTIVE CLASSIFICATIONS. THE CORRECTNESS OF THE
REALLOCATIONS OF TIME, WHICH MUST DEPEND UPON FINAL DETERMINATION OF
WHAT THE WORKERS WERE IN FACT DOING DURING THE HOURS INVOLVED, IS THE
MATTER IN DISPUTE. IN OUR VIEW THIS IS A FACTUAL MATTER COGNIZABLE
UNDER THE DISPUTES CLAUSE. CF. DOLL PAINTING CO., INC. ASBCA NO. 9305,
SEPTEMBER 18, 1964.
SINCE WE DO NOT FEEL THAT THE CONTRACTING OFFICER'S PURPORTED
DECISION OF MAY 9, 1968, WAS SUCH A DECISION AS CONTEMPLATED BY THE
DISPUTES CLAUSE, WE CONCLUDE THAT WE ARE NOT IN A POSITION TO DETERMINE
THE PROPER DISTRIBUTION OF THE FUNDS WITHHELD, WHICH HAVE BEEN FORWARDED
HERE IN ACCORDANCE WITH THE PROVISIONS OF THE DAVIS-BACON ACT.
WE SHALL AWAIT YOUR ADVICE AS TO THE FURTHER ACTION OF YOUR AGENCY IN
THE MATTER, WHICH WE HOPE MAY BE EXPEDITED. COPIES OF THIS LETTER ARE
BEING FORWARDED TO THE SECRETARY OF LABOR AND TO THE CONTRACTOR'S
ATTORNEY.
B-167059, OCT. 22, 1969
BIDS--DISCARDING ALL BIDS--READVERTISEMENT JUSTIFICATION--NEWER MODEL
AVAILABLE
AFTER ASCERTAINING FROM BID LITERATURE THAT LATER AND MORE EFFICIENT
MODEL VIBRATORY CLEANING MACHINES WERE AVAILABLE AND PROCURABLE WITHOUT
SPECIFYING BRAND NAME OR EQUAL, EVEN THOUGH LOW BIDDER CLAIMED HIS
PRODUCT MET EXISTING NEEDS AND NEW SPECIFICATIONS FOR BOWL-TYPE (ROUND)
INSTEAD OF RECTANGULAR TYPE TUBS WERE RESTRICTIVE, BID CANCELLATION AND
READVERTISEMENT WAS PROPER EXERCISE OF ADMINISTRATIVE DISCRETION, SINCE
IN ADDITION TO FINDING THAT PROCUREMENT OF NEWER MODEL WAS IN PUBLIC
INTEREST, FAILURE TO SPECIFY THAT ONLY BOWL-TYPE CLEANERS MEET MINIMUM
REQUIREMENTS IN ORIGINAL INVITATION WAS DEFECT WHICH ALONE WOULD JUSTIFY
CANCELLATION; AND RECEIPT OF THREE BIDS UNDER NEW INVITATION NEGATES
CONTENTION THAT SPECIFICATIONS WERE UNDULY RESTRICTIVE.
TO KENCO, INC.:
WE REFER TO YOUR TELEGRAM OF MAY 26, AS SUPPLEMENTED BY YOUR LETTERS
OF MAY 26, JULY 18, AND AUGUST 18, 1969, WITH ENCLOSURES, PROTESTING
AGAINST CANCELLATION OF INVITATION FOR BIDS (IFB) NO. F34650-69-B-0135
FOR THE PROCUREMENT OF SIX VIBRATORY CLEANING MACHINES AND
READVERTISEMENT OF THE REQUIREMENT UNDER IFB NO. F34650-69-B-0210, BY
THE OKLAHOMA CITY AIR MATERIEL AREA (OCAMA), TINKER AIR FORCE BASE,
OKLAHOMA. THE MACHINES ARE USED FOR CLEANING, DEBURRING, SURFACE
IMPROVING AND BURNISHING MACHINE COMPONENTS, SUCH AS JET ENGINE PARTS.
IFB NO. F34650-69-B-0135, ISSUED ON MARCH 15, 1969, SET FORTH THE
REQUIREMENT UNDER TWO ITEMS OF THREE UNITS EACH. ITEM 1 DESCRIBED THE
MACHINES AS SOUTHWESTERN ENGINEERING COMPANY (SWECO) PART NUMBER FMD10HA
WITH UNLOADER AND 440 VOLT MOTOR OR EQUAL. ITEM 2 DESCRIBED THE
MACHINES AS SWECO PART NUMBER FMD3HA WITH UNLOADER AND 440 VOLT MOTOR OR
EQUAL. THE BRAND NAME OR EQUAL CLAUSE INCLUDED IN THE IFB, INTER ALIA,
PROVIDED:
"/C) (1) IF THE BIDDER PROPOSES TO FURNISH AN -EQUAL- PRODUCT, THE
BRAND NAME, IF ANY, OF THE PRODUCT TO BE FURNISHED SHALL BE INSERTED IN
THE SPACE PROVIDED IN THE INVITATION FOR BIDS, OR SUCH PRODUCT SHALL BE
OTHERWISE CLEARLY IDENTIFIED IN THE BID. THE EVALUATION OF BIDS AND THE
DETERMINATION AS TO EQUALITY OF THE PRODUCT OFFERED SHALL BE THE
RESPONSIBILITY OF THE GOVERNMENT AND WILL BE BASED ON INFORMATION
FURNISHED BY THE BIDDER OR IDENTIFIED IN HIS BID, AS WELL AS OTHER
INFORMATION REASONABLY AVAILABLE TO THE PURCHASING ACTIVITY. * * *"
ON APRIL 8, 1969, BIDS WERE OPENED AS SCHEDULED. YOUR BID, WITH A
TOTAL PRICE OF $31,275, PROPOSING TO FURNISH MACHINES MANUFACTURED BY
HUTSON CORPORATION AND IDENTIFIED AS MODEL NOS. H15 AND H-3-ED, WAS THE
LOWEST OF THE FIVE BIDS RECEIVED. THE DESCRIPTIVE DATA FURNISHED WITH
YOUR BID DISCLOSED THAT THE MACHINE TUBS WERE "U" SHAPED. DATA
FURNISHED ON APRIL 14, WITH RESPECT TO OPERATION OF THE UNLOADERS,
STATED THAT "THE PARTS REMAIN UPON SCREEN AND ARE REMOVED MANUALLY.'
BY LETTER DATED APRIL 9, 1969, YOU ADVISED OCAMA THAT THE UNITS YOU
OFFERED WERE EQUAL TO OR BETTER THAN THE UNITS REQUIRED BY THE IFB, AND
YOU THEREFORE REGISTERED A PROTEST AGAINST ANY DECISION THAT MIGHT BE
MADE THAT YOUR MACHINES WERE NOT "EQUAL.' THE PROTEST WAS ACKNOWLEDGED
BY THE CONTRACTING OFFICER'S LETTER OF APRIL 21.
THE RECORD INDICATES THAT THE USING ACTIVITY AT OCAMA ASCERTAINED
FROM THE DESCRIPTIVE LITERATURE SUBMITTED BY THE OTHER BIDDERS THAT A
LATER MODEL VIBRATORY MACHINE WAS AVAILABLE WHICH WOULD IMPROVE THE
USING ACTIVITY'S CLEANING FACILITIES. SPECIFICALLY, THE ACTIVITY
DISCOVERED THAT THE NEWER MACHINE WAS EQUIPPED WITH AN AUTOMATIC WATER
COMPOUND DISPENSING SYSTEM, A FEATURE WHICH ACCOMPLISHES AUTOMATIC
DISCHARGING OF THE CLEANED PARTS AND ADDITION OF OTHER PARTS FOR
CLEANING WITHOUT SHUTTING THE ENGINE DOWN. ADDITIONALLY, THE USING
ACTIVITY DETERMINED THAT BASED ON THE DESCRIPTIVE LITERATURE SUBMITTED
ITS ENGINEERING PERSONNEL COULD PREPARE SPECIFICATIONS AND THUS
ELIMINATE THE NECESSITY FOR A BRAND NAME OR EQUAL PROCUREMENT.
ACCORDINGLY, ON APRIL 24 THE USING ACTIVITY REQUESTED CANCELLATION OF
THE IFB, AND ON APRIL 25, THE CONTRACTING OFFICER ISSUED A
DETERMINATION, PURSUANT TO ARMED SERVICES PROCUREMENT REGULATION (ASPR)
2-404.1 (B) (II), THAT SUCH ACTION WOULD BE IN THE BEST INTEREST OF THE
GOVERNMENT. NOTICE OF CANCELLATION WAS GIVEN TO ALL BIDDERS BY LETTER
OF APRIL 29, 1969, WHICH INCLUDED ADVICE THAT NEW SPECIFICATIONS WOULD
BE ISSUED AT A LATER DATE.
IFB NO. F34650-69-B-0210, WHICH WAS ISSUED MAY 15, 1969, TO YOU AND
TO FIVE OTHER SOURCES, INCLUDED SPECIFICATIONS FOR BOTH MODELS OF
MACHINES. THE SPECIFICATIONS APPLICABLE TO ITEM 1 READ, IN PERTINENT
PART, AS FOLLOWS: "3.1 THE VIBRATOR SHALL BE OF TOP LOADING BOWL TYPE
(PARTS, MEDIA,
WATER, ETC.) WITH SEPARATION AND UNLOADING OF PARTS AND MEDIA BEING
THROUGH THE USE OF A DAM AND SEPARATOR SCREENS, AUTOMATIC OR
SEMI-AUTOMATIC.'3.2 THE DESIRED VIBRATORY ACTION SHALL BE ACHIEVED BY
ADJUSTING ECCENTRIC WEIGHTS FITTED ONTO THE VERTICAL MOTOR SHAFT.'3.3
THE OVERALL DIMENSIONS OF THE VIBRATORY MACHINE SHALL BE 50 INCHES IN
DIAMETER PLUS OR MINUS 10 INCHES AND 50 INCHES HIGH (UNLOADED), PLUS OR
MINUS 6 INCHES.'3.4 EQUIPPED WITH AN AUTOMATIC WATER AND COMPOUND
DISPENSING SYSTEM, WITH AN ADJUSTIBLE FLOW RATE. THE DISCHARGE OF
RINSING WATER AND ABRASIVE SLUDGE SHALL BE THROUGH ONE (1) TWO TO THREE
INCH DRAIN. THIS DRAIN MUST BE CAPABLE OF OPERATING WHILE THE MACHINE
IS RUNNING AT THE OPTION OF THE OPERATOR.'
SIMILAR REQUIREMENTS APPLIED TO ITEM 2 EXCEPT THAT THE OVERALL
DIMENSIONS WERE 2 FEET 6 INCHES IN DIAMETER AND 3 FEET 3 INCHES HIGH
(UNLOADED), PLUS OR MINUS 6 INCHES.
IN YOUR PRE-BID OPENING TELEGRAM AND LETTER OF MAY 26 TO OUR OFFICE,
YOU ASSERTED THAT CERTAIN ASPECTS OF THE PURCHASE DESCRIPTION IN THE
SECOND IFB WERE PROPRIETARY AND RESTRICTED THE PROCUREMENT TO SWECO
MACHINES. SPECIFICALLY, YOU CLAIMED THAT YOUR RECTANGULAR TUB IS
EQUALLY AS EFFICIENT AS THE ROUND TUB REQUIRED BY THE SPECIFICATIONS,
AND YOU STATED THAT YOU FOUND IT IMPOSSIBLE TO SUBMIT A BID WITHOUT
TAKING EXCEPTION TO THE PROPRIETARY ASPECTS OF THE PURCHASE
DESCRIPTIONS. YOU THEREFORE REQUESTED THAT THE SECOND IFB BE CANCELLED;
THAT THE ORIGINAL IFB BE REINSTATED; AND THAT AWARD BE MADE TO YOU AS
THE LOWEST BIDDER.
THE OCAMA PROCURING ACTIVITY GAVE CONSIDERATION TO YOUR PRE-BID
OPENING PROTEST BUT DETERMINED THAT THE READVERTISEMENT WAS JUSTIFIED IN
VIEW OF THE FINDING BY THE USING ACTIVITY THAT THE AUTOMATIC WATER
COMPOUND DISPENSING SYSTEM AVAILABLE ON SOME MODELS OF VIBRATORY
MACHINES WAS ADVANTAGEOUS TO THE GOVERNMENT FROM BOTH AN EFFICIENCY AND
ECONOMY STANDPOINT AND THAT THE AVAILABLE DESCRIPTIVE LITERATURE ON SUCH
MACHINES PROVIDED AN ADEQUATE BASIS FOR PREPARATION OF SPECIFICATIONS
REFLECTING THE ACTIVITY'S MINIMUM NEEDS. ACCORDINGLY, BIDS RECEIVED
UNDER THE SECOND IFB WERE OPENED ON JUNE 6, AS SCHEDULED, AND THE
RESULTS WERE AS FOLLOWS:
UNIT PRICES
-----------
BIDDER ITEM 1 ITEM 2
------ ------ ------
ROTO-FINISH CO. $8,712.00 $3,955.00
HART, INDUSTRIAL SUPPLY 8,530.00 3,830.00
SWECO, INC. 8,516.00 3,800.00
WITH YOUR LETTER OF JULY 18, 1969, YOU ENCLOSED A COPY OF A CONTRACT
AWARDED BY KELLY AIR FORCE BASE, TEXAS, ON JULY 15, 1969, TO ANOTHER
COMPANY FOR THE FURNISHING OF THE SAME MODELS OF VIBRATORY MACHINES AS
YOU HAD OFFERED IN YOUR BID, AND YOU STATED THAT MANY DIFFERENT JET
ENGINE PARTS HAD BEEN CLEANED OVER A PERIOD OF SIX WEEKS IN SUCH
MACHINES WITHOUT MALFUNCTIONS. IN ADDITION, YOU SUBMITTED A "TECH
NOTE," DATED MARCH 1969, PUBLISHED BY THE MAINTENANCE TECHNOLOGY OFFICE,
TINKER AIR FORCE BASE, OKLAHOMA, WHICH DESCRIBED BOTH TUB- AND BOWL-TYPE
VIBRATORY MACHINES AND, WITHOUT STATING ANY PREFERENCE, SUGGESTED THEIR
USE FOR CLEANING AIRCRAFT ENGINE PARTS.
IN YOUR LETTER OF AUGUST 18 YOU STATE THAT THE AUTOMATIC WATER
COMPOUND DISPENSING SYSTEM IS NOT A NEW INNOVATION; THAT HAD THE
ORIGINAL IFB INCLUDED THIS ACCESSORY, YOU COULD HAVE BID ON IT; AND
THAT IF THE AGENCY WANTED THE WATER COMPOUND DISPENSING SYSTEM, IT
SHOULD HAVE ISSUED AN AMENDMENT TO THE ORIGINAL IFB INSTEAD OF REWRITING
THE SPECIFICATIONS IN A RESTRICTIVE MANNER WHICH PRECLUDED THE
SUBMISSION OF A TUB TYPE MODEL. FURTHER, YOU STATE THAT IT IS ONLY THE
REQUIREMENT THAT THE POSITION OF THE MOTOR IN THE VIBRATORY MACHINES BE
MOUNTED VERTICALLY WHICH PRECLUDES YOU AND OTHER MANUFACTURERS FROM
BEING RESPONSIVE TO THE SECOND IFB. ACCORDINGLY, YOU ADHERE TO YOUR
POSITION THAT AWARD SHOULD BE MADE TO YOU UNDER THE ORIGINAL IFB, AND
YOU URGE THAT A NEW IFB SHOULD BE ISSUED FOR PROCUREMENT OF THE
AUTOMATIC WATER COMPOUND DISPENSING SYSTEM, WHICH YOU CLAIM IS VIRTUALLY
INTERCHANGEABLE BETWEEN ALL MANUFACTURERS.
OCAMA REPORTS THAT YOUR BID UNDER THE ORIGINAL IFB OFFERED A NEOPRENE
LINER IN LIEU OF A POLYURETHANE LINER AND A SCREEN SEPARATOR IN LIEU OF
AN UNLOADER; HOWEVER, SUCH VARIANCES FROM THE SWECO MACHINES WERE NOT
CITED TO YOU IN VIEW OF THE DECISION TO READVERTISE THE PROCUREMENT. IN
ADDITION, OCAMA RECORDS SHOW THAT YOU WERE ONE OF FOUR CONCERNS WHICH
LOANED A VIBRATORY CLEANING MACHINE TO OCAMA FOR THE CONDUCT OF PROCESS
TESTING. DURING THE PERIOD ENDING JULY 24, 1969, IN WHICH YOUR MACHINE,
A HUTSON MODEL, WAS TESTED, THE FOLLOWING GENERAL OBSERVATIONS WITH
RESPECT TO THE MACHINE WERE MADE BY OCAMA TECHNICAL PERSONNEL:
"/1) THE PARTS/MEDIA SEPARATOR SUPPLIED WITH THE MACHINE WAS NOT
ADEQUATE AS DESIGNED FOR SEPARATING SMALL PARTS FROM THE MEDIA. TWO
TEMPORARY MODIFICATIONS WERE MADE TO THE SEPARATOR WHICH IMPROVED ITS
OPERATION. WITH THESE TWO MODIFICATIONS, COMPLETE REMOVAL OF ALL PARTS
FROM THE MEDIA COULD NOT BE ASSURED. TWO MEN WERE REQUIRED TO REMOVE
THE SEPARATOR.
"/2) REMOVAL OF A LOAD OF NOZZLE NUTS (APPROXIMATELY 1,000) TOOK TWO
MEN APPROXIMATELY 20 MINUTES. THIS REQUIREMENT MADE IT OBVIOUS THAT FOR
PROCESSING LARGE BATCHES OF SMALL PARTS A VIBRATORY MACHINE WITH AN
AUTOMATIC UNLOADER IS HIGHLY DESIRABLE.
"/3) USAGE OF MEDIA (WEAR AWAY RATE) WAS OBSERVED TO BE APPROXIMATELY
SIX POUNDS PER HOUR OF MACHINE OPERATION. THE AMPLITUDE OF THE MACHINE
WAS VARIED DURING THIS OBSERVATION.
"/4) SHOP AIR PRESSURE WAS NEEDED TO ENSURE LUBRICATION OF THE DRIVE
SHAFT BEARINGS. EXCESS LUBRICANT OVERFLOWS FROM THE BLEED VALVE AND
DRIPS ON THE FLOOR. THE DRIVE SHAFT SLINGS THE LUBRICANT THAT BLEEDS
FROM THE BEARINGS ONTO THE MACHINE AND FLOOR. THIS MAY PRESENT A SAFETY
HAZARD.
"/5) THE NOISE GENERATED BY THE HUTSON MACHINE WAS IRRITATING
(WORKMEN IN THE GENERAL AREA COMPLAINED). A SOUND SURVEY CONDUCTED BY A
BIOENVIRONMENTAL ENGINEER RECOMMENDED EAR DEFENDERS WHENEVER THE HUTSON
MACHINE WAS IN USE (ATCH 4). HIS REPORT ALSO STATED EAR PROTECTION WAS
NOT NECESSARY FOR OPERATORS OF THE OTHER THREE MACHINES SURVEYED WHICH
ARE FROM ANOTHER COMPANY.
"/6) THE RUBBER LINER IN THE HUTSON MACHINE INDICATED GOUGES AFTER
PROCESSING TURBINE BLADES. IT PROBABLY WOULD NOT WITHSTAND ABUSIVE
ACTION OF THIS NATURE FOR LONG PERIODS OF TIME.'
AS TO THE SPECIFICATIONS SET FORTH IN THE SECOND IFB, OCAMA STATES
THAT THE BOWL TYPE OF MACHINES WAS DESIGNATED BECAUSE OF SPACE
LIMITATIONS AT THE USING ACTIVITY AND THAT SUCH MODEL EQUIPPED WITH
AUTOMATIC WATER COMPOUND DISPENSING SYSTEM, SEMI-AUTOMATIC SEPARATING
AND UNLOADING CAPABILITY WAS SELECTED BECAUSE IT IS BEST SUITED TO
OCAMA'S MISSION.
ARMED SERVICES PROCUREMENT REGULATION 2-208 PERMITS AMENDMENT OF AN
IFB TO EFFECT A CHANGE IN SPECIFICATIONS OR TO CORRECT A DEFICIENCY OR
AMBIGUITY IN THE IFB, AMONG OTHER REASONS, PROVIDED THERE IS SUFFICIENT
TIME BEFORE BID OPENING TO ENABLE ALL PROSPECTIVE BIDDERS TO CONSIDER
THE CHANGES IN SUBMITTING OR MODIFYING THEIR BIDS. WHERE, AS HERE, A
DEFECT OR AMBIGUITY IN THE IFB OR A NEED FOR REVISION OF THE
SPECIFICATIONS COMES TO LIGHT AFTER BID OPENING, THE MATTER IS GOVERNED
BY THE PROVISIONS OF ASPR 2-404.1, RELATING TO CANCELLATION OF AN
INVITATION AFTER OPENING, WHICH IMPLEMENTS THE AUTHORITY IN 10 U.S.C.
2305 (C) FOR THE REJECTION OF ALL BIDS IN A FORMALLY ADVERTISED
PROCUREMENT WHERE SUCH ACTION IS DETERMINED TO BE IN THE PUBLIC
INTEREST.
THE EVIDENCE OF RECORD ESTABLISHES THAT SPACE LIMITATIONS AT THE
USING ACTIVITY PRECLUDE USE OF OTHER THAN BOWL-TYPE MACHINES.
ACCORDINGLY, WHILE SUCH RESTRICTION NECESSARILY ELIMINATES FROM
CONSIDERATION THOSE BIDS OFFERING MACHINES WHICH CANNOT BE USED IN THE
AVAILABLE SPACE, WE ARE UNABLE TO CONCLUDE THAT IT DOES NOT REPRESENT A
BONA FIDE MINIMUM REQUIREMENT OF THE PROCURING AGENCY. TO THE EXTENT,
THEREFORE, THAT THE ORIGINAL IFB FAILED TO ADVISE BIDDERS THAT ONLY A
BOWL-TYPE MACHINE WOULD MEET THE GOVERNMENT'S MINIMUM REQUIREMENTS, IT
WAS DEFECTIVE, AND THE DEFECT NOT HAVING BEEN CORRECTED BY AN IFB
AMENDMENT BEFORE THE BIDS WERE OPENED, SUCH FACTOR ALONE, ALTHOUGH NOT
MENTIONED IN THE DETERMINATION ISSUED BY THE CONTRACTING OFFICER IN
SUPPORT OF THE IFB CANCELLATION, WAS SUFFICIENT TO JUSTIFY SUCH ACTION.
38 COMP. GEN. 345, 348.
AS TO THE PROPRIETY OF THE INCLUSION IN THE SECOND IFB OF THE
REQUIREMENT FOR THE BOWL-TYPE MACHINE AND THE OTHER FEATURES DISCUSSED
ABOVE, OUR OFFICE HAS LONG HELD THAT THE DRAFTING OF SPECIFICATIONS TO
REFLECT THE NEEDS OF THE GOVERNMENT IS PRIMARILY WITHIN THE PROVINCE OF
THE PROCURING AGENCY. 17 COMP. GEN. 554. FURTHER, WE HAVE STATED THAT
THE MERE FACT THAT ONE BIDDER IS UNABLE TO MEET THE GOVERNMENT'S
SPECIFICATIONS IS NOT DETERMINATIVE OF THE QUESTION WHETHER A PARTICULAR
SPECIFICATION IS RESTRICTIVE. SEE 30 COMP. GEN. 368; 33 ID. 586. NOR
DOES THE FACT THAT SUCH A BIDDER OFFERS LOWER PRICED EQUIPMENT REQUIRE
THE GOVERNMENT TO PURCHASE SUCH ITEMS, FOR THE GOVERNMENT IS NOT TO BE
PLACED IN A POSITION WHEREBY BIDDERS MAY DICTATE SPECIFICATIONS WHICH
WILL PERMIT ACCEPTANCE OF EQUIPMENT WHICH DOES NOT, IN THE CONSIDERED
JUDGMENT OF THE CONTRACTING AGENCY, REASONABLY MEET THE AGENCY'S NEEDS.
36 COMP. GEN. 251, 252.
SINCE THE AIR FORCE REPORTS THAT AT LEAST THREE BIDDERS ARE IN A
POSITION TO SUPPLY MACHINES WHICH MEET THE SPECIFICATIONS IN THE SECOND
IFB, WE ARE OF THE VIEW THAT SUCH SPECIFICATIONS ARE NOT UNDULY
RESTRICTIVE. SEE B-161654, AUGUST 7, 1967; B-164222, SEPTEMBER 23,
1968.
WE RECOGNIZE THAT THE ADMINISTRATIVE DECISION TO PROCURE THE
AUTOMATIC WATER COMPOUND DISPENSING SYSTEM FEATURE ON THE VIBRATORY
MACHINES WAS MADE LATE IN THE PROCUREMENT CYCLE AND OPERATED TO YOUR
DISADVANTAGE. HOWEVER, CONTRACTING OFFICERS ARE CLOTHED WITH BROAD
POWERS OF DISCRETION IN DECIDING WHETHER AN INVITATION FOR BIDS SHOULD
BE CANCELLED, AND IN THE ABSENCE OF CLEAR EVIDENCE OF ABUSE OF SUCH
DISCRETIONARY POWERS, WE WILL NOT OBJECT TO SUCH ACTION. 40 COMP. GEN.
352, 41 ID. 709. FURTHER, IN THIS CASE, THE CANCELLATION RESULTED IN
THE ELIMINATION OF A BRAND NAME OR EQUAL PURCHASE DESCRIPTION, WHICH
SHOULD ONLY BE USED WHEN A DETAILED DESCRIPTION CANNOT BE MADE
AVAILABLE. ASPR 1-1206.1 (A). IN SUCH CIRCUMSTANCES, WE SEE NO LEGAL
BASIS FOR A FINDING THAT THE CANCELLATION OF IFB NO. F34650-69-B-0135
AND THE READVERTISEMENT OF THE PROCUREMENT REQUIREMENT WAS OTHER THAN A
REASONABLE AND PROPER EXERCISE OF ADMINISTRATIVE DISCRETION. SEE
B-162382, MAY 17, 1968.
B-167613, OCT. 22, 1969
AWARDS--SMALL BUSINESS CONCERNS--SIZE--AFFILIATES OF LARGE BUSINESS
CONCERNS
UNSUCCESSFUL SMALL BUSINESS OFFEROR WHO CONTENDS THAT SUCCESSFUL
OFFEROR IS DIVISION OF LARGE BUSINESS AND THEREFORE INELIGIBLE FOR AWARD
UNDER TOTAL SMALL BUSINESS SET-ASIDE, OFFERS NO BASIS FOR OBJECTION
SINCE RECORD CONTAINS NO CONCLUSIVE INFORMATION TO REFUTE OR CONFIRM
ALLEGATION THAT CONTRACTOR WAS OR WAS NOT AT TIME OF AWARD SMALL
BUSINESS; MOREOVER, GAO WILL MAKE NO SUCH DETERMINATION SINCE THAT
AUTHORITY IS VESTED BY LAW IN SMALL BUSINESS ADMINISTRATION. CONTRACTING
OFFICER WAS REQUIRED TO ACCEPT SUCCESSFUL OFFEROR'S SELF-CERTIFICATION
OF SMALL BUSINESS STATUS UNLESS HE POSSESSED INFORMATION TO CONTRARY.
NOTHING INDICATED SUCCESSFUL OFFEROR HAD PARENT FIRM OR CORPORATE
AFFILIATION WHICH WOULD DISQUALIFY IT. IN ANY EVENT, PROTEST WAS
UNTIMELY UNDER THEN CURRENT REGULATIONS.
TO BACON AMERICAN CORPORATION:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 30, 1969, AND
SUBSEQUENT CORRESPONDENCE, PROTESTING AGAINST THE AWARD OF A CONTRACT
FOR THE FURNISHING AND INSTALLATION OF A TIRE REBUILD SHOP TO WISDOM
RUBBER INDUSTRIES, INC. (HEREAFTER WISDOM) ON JUNE 30, 1969, BY ROCK
ISLAND ARSENAL, ROCK ISLAND, ILLINOIS, UNDER RFP NO. DAAF01-69-R-0815,
ISSUED ON MAY 29, 1969, AS A TOTAL SMALL BUSINESS SET-ASIDE. ON JULY 1,
1969, THE DAY AFTER CONTRACT AWARD, YOU PROTESTED AGAINST THE AWARD TO
WISDOM BY TELEGRAM TO THE CONTRACTING OFFICER. WHILE A RESPONSE TO YOUR
PROTEST WAS BEING PREPARED BY ROCK ISLAND ARSENAL, YOU INFORMED THE
ARSENAL THAT YOU WERE INITIATING A PROTEST TO THIS OFFICE. THE
ADMINISTRATIVE REPORT FURNISHED US IN THIS MATTER STATES THAT
INFORMATION CONCERNING YOUR PROTEST HAS BEEN PROVIDED TO THE SMALL
BUSINESS ADMINISTRATION (SBA) PURSUANT TO ARMED SERVICES PROCUREMENT
REGULATION (ASPR) 1-703 (B) (1) (III).
YOU CONTEND THAT AWARD TO WISDOM WAS IMPROPER BECAUSE (1) AN
AMENDMENT TO THE RFP WAS MADE TO PERMIT A LARGE BUSINESS TO WITHDRAW ITS
OFFER; (2) WISDOM DECREASED ITS PRICE IN RESPONSE TO THE AMENDMENT,
EVEN THOUGH THE AMENDMENT INCREASED THE CONTRACT REQUIREMENTS,
INDICATING WISDOM'S RECEIPT OF MORE PRECISE INFORMATION THAN WAS GIVEN
YOU; (3) THE CONTRACTING OFFICER REVEALED A BIAS AGAINST YOUR FIRM BY
STATING YOU WOULD HAVE A "BETTER CHANCE" ON SUBSEQUENT PROCUREMENTS;
AND (4) WISDOM IS A DIVISION OF A LARGE BUSINESS AND THEREFORE WAS
INELIGIBLE FOR AWARD.
THE ADMINISTRATIVE RECORD SHOWS THAT IN RESPONSE TO RFP NO.
DAAF01-69-R-0815, OFFERS WERE RECEIVED FROM FOUR FIRMS: BACON AMERICAN;
SUPER MOLD CORPORATION (SUPER MOLD); JAMES C. HEINTZ CO.
(HEINTZ); AND WISDOM. AN EXAMINATION OF SUPER MOLD'S OFFER REVEALED
IT WAS NOT A SMALL BUSINESS CONCERN. UPON DISCOVERY THAT SUPER MOLD WAS
NOT ELIGIBLE FOR AWARD, NO FURTHER NEGOTIATIONS WERE CONDUCTED WITH IT.
ROCK ISLAND ARSENAL REQUESTED A PARTIAL PRE-AWARD SURVEY BE MADE OF
WISDOM, THE LOW OFFEROR. THE SURVEY, CONDUCTED BY THE DEFENSE CONTRACT
ADMINISTRATION SERVICES REGION (DCASR), SAN FRANCISCO, DATED JUNE 20,
1969, RECOMMENDED "COMPLETE AWARD" TO WISDOM. THE SURVEY IDENTIFIED
WISDOM AS A CORPORATION WHICH WAS A DISTRIBUTOR, REGULAR DEALER AND A
MANUFACTURER'S AGENT, BUT THERE WAS NO INDICATION THAT WISDOM HAD A
PARENT FIRM OR OTHER CORPORATE AFFILIATIONS. WISDOM HAD ALSO CERTIFIED
ITSELF AS A SMALL BUSINESS IN THE SUBMISSION OF ITS OFFER.
THE RFP REQUIRED OFFERORS TO FURNISH THREE TIRE TREAD BUFFING
MACHINES WHICH, AMONG OTHER STATED CHARACTERISTICS, WERE TO HAVE 30 HP,
1750-RPM MOTORS. ALL OFFERS WERE SUBMITTED TO THE ARMY TIRE
RECONDITIONING SURVEY TEAM FOR TECHNICAL EVALUATION. THE TEAM, BY
LETTER OF JUNE 11, 1969, TO THE CONTRACTING OFFICER, FOUND THAT NO
OFFERS MET THE 30 HP - 1750 RPM MOTOR REQUIREMENTS, AND RECOMMENDED THAT
CERTAIN ALTERNATE EQUIPMENT BE SUBSTITUTED IN THE RFP, TO STATE A
REQUIREMENT FOR EQUIPMENT WHICH COULD BE SATISFIED BY ALL OFFERORS.
THIS RECOMMENDATION WAS EMBODIED IN AMENDMENT NO. 1 TO THE RFP, WHICH
WAS SENT TO BACON AMERICAN, HEINTZ AND WISDOM BY TELEGRAM OF JUNE 12,
1969, AND WHICH WAS LATER FORMALLY INCORPORATED INTO THE RFP. IN
RESPONSE TO THE AMENDMENT, HEINTZ WITHDREW ITS OFFER, AND YOUR FIRM AND
WISDOM SUBMITTED MODIFIED OFFERS IN WHICH EACH FIRM INCREASED ITS PRICE.
SUBSEQUENTLY, THE CONTRACTING OFFICER REOPENED NEGOTIATIONS TO
CLARIFY THE DELIVERY SCHEDULE AND TO VERIFY ITS IMPACT UPON PRICE. THE
RFP PROVIDED FOR THE EQUIPMENT TO BE COMPLETELY INSTALLED AND OPERATING
WITHIN 120 DAYS OF AWARD OF CONTRACT, BUT PERMITTED PROPOSED ALTERNATE
DELIVERY SCHEDULES. SINCE THE EQUIPMENT WAS TO BE INSTALLED IN TAIWAN,
THE GOVERNMENT HAD CONTEMPLATED A 25-DAY PERIOD BETWEEN DELIVERY OF
MATERIAL TO THE POINT OF LOADING AND THE ARRIVAL OF THE MATERIAL AT THE
SITE OF INSTALLATION. YOU INFORMED THE CONTRACTING OFFICER THAT THIS
INTERVAL WOULD NOT CHANGE YOUR PRICE OR PROPOSED ALTERNATE DELIVERY
SCHEDULE OF 175 DAYS. WISDOM SIMILARLY DID NOT REVISE ITS PRICE OR
DELIVERY SCHEDULE OF 120 DAYS.
A PRICE AND COST ANALYSIS WAS CONDUCTED OF WISDOM'S PROPOSAL, AND THE
GOVERNMENT INDEPENDENTLY ESTIMATED THE COST OF PERFORMANCE. THE
GOVERNMENT ESTIMATE EXCEEDED THE WISDOM PRICE BY $5,000, AND IN VIEW OF
THIS FAVORABLE COMPARISON, AWARD TO WISDOM WAS RECOMMENDED. THE ROCK
ISLAND ARSENAL BOARD OF AWARDS MET ON JUNE 27, 1969, AND UPON REVIEW OF
THE OFFERS RECEIVED, RECOMMENDED AWARD TO WISDOM. THE CONTRACT WAS
AWARDED ON JUNE 30, 1969, AND YOU PROTESTED AGAINST THE AWARD ON THE
FOLLOWING DAY.
YOUR FIRST CONTENTION IS THAT AMENDMENT NO. 1 TO THE RFP WAS ISSUED
TO PERMIT SUPER MOLD "TO DROP OUT OF THE BIDDING.' THE ADMINISTRATIVE
RECORD SHOWS THAT THE AMENDMENT WAS ISSUED, UPON THE RECOMMENDATION OF
THE ARMY TIRE RECONDITIONING SURVEY TEAM, TO SUBSTITUTE EQUIPMENT WHICH
COULD BE SUPPLIED BY ALL OFFERORS. IN ADDITION, SUPER MOLD WAS NO
LONGER CONSIDERED FOR AWARD, AND NO FURTHER NEGOTIATIONS WERE CONDUCTED
WITH IT, AFTER DISCOVERY OF ITS LARGE BUSINESS STATUS. AMENDMENT NO. 1
WAS NOT EVEN SENT TO SUPER MOLD. YOUR ATTENTION IS ALSO DIRECTED TO
PARAGRAPH 7 (B) OF STANDARD FORM 33A, A PART OF THE RFP, WHICH STATES:
"IF THIS SOLICITATION IS NEGOTIATED, OFFERS MAY BE MODIFIED (SUBJECT
TO PAR. 8, WHEN APPLICABLE) OR WITHDRAWN BY WRITTEN OR TELEGRAPHIC
NOTICE RECEIVED AT ANY TIME PRIOR TO AWARD. * * *" SUPER MOLD WAS THUS
FREE TO WITHDRAW ITS OFFER AT ANY TIME PRIOR TO AWARD. THERE WAS NO
PREREQUISITE OF GOVERNMENT ACTION, SUCH AS AN AMENDMENT TO THE RFP, FOR
WITHDRAWAL OF AN OFFER. WE THEREFORE FIND YOUR FIRST CONTENTION IS
WITHOUT MERIT.
YOU ALSO ALLEGE THAT WISDOM WAS GIVEN MORE COMPLETE INFORMATION THAN
YOUR FIRM, ENABLING THEM TO REDUCE, INSTEAD OF INCREASE, THEIR PRICE IN
RESPONSE TO AMENDMENT NO. 1. HOWEVER, THE RECORD INDICATES THAT WISDOM
INCREASED, RATHER THAN REDUCED, ITS PRICE IN RESPONDING TO THE
AMENDMENT. THERE IS NO INDICATION OF RECORD THAT WISDOM WAS PROVIDED
MORE COMPLETE INFORMATION THAN YOUR FIRM.
BACON AMERICAN, HEINTZ AND WISDOM WERE ALL SENT THE SAME TELEGRAM ON
JUNE 12, 1969. THEREFORE, WE FIND NO BASIS FOR YOUR SECOND CONTENTION.
SIMILARLY, THERE IS NO EVIDENCE OF RECORD THAT THE CONTRACTING
OFFICER EXHIBITED BIAS IN THE EVALUATION OF YOUR OFFER. YOUR STATEMENT
THAT THE CONTRACTING OFFICER PROMISED YOU A "BETTER CHANCE" IN FUTURE
PROCUREMENTS APPEARS TO RESULT FROM A MISINTERPRETATION OF AN EXPRESSION
THAT YOU WOULD BE AFFORDED AN OPPORTUNITY TO PARTICIPATE IN FUTURE
PROCUREMENTS.
YOU ALSO MAINTAIN THAT WISDOM IS A DIVISION OF SUPER MOLD AND
THEREFORE WAS INELIGIBLE FOR AWARD UNDER A TOTAL SMALL BUSINESS
SET-ASIDE PROCUREMENT. NO CONCLUSIVE INFORMATION APPEARS IN THE RECORD
TO EITHER REFUTE OR CONFIRM YOUR ALLEGATION THAT WISDOM WAS OR WAS NOT
AT THE TIME OF AWARD A SMALL BUSINESS CONCERN, NOR WILL THIS OFFICE MAKE
SUCH A DETERMINATION. THE AUTHORITY TO DETERMINE IN PROCUREMENT MATTERS
WHETHER A BIDDER WHO REPRESENTS HIMSELF AS A SMALL BUSINESS CONCERN IS,
IN FACT, A SMALL BUSINESS CONCERN IS VESTED BY LAW IN THE SMALL BUSINESS
ADMINISTRATION. 15 U.S.C. 637 (B) (6). NEITHER THE CONTRACTING AGENCY
NOR THE OTHER BIDDERS ARE AUTHORIZED OR QUALIFIED TO MAKE SUCH A
DETERMINATION, AND THE PROCEDURES ESTABLISHED BY REGULATION FOR REFERRAL
OF SMALL BUSINESS QUESTIONS TO THE SMALL BUSINESS ADMINISTRATION ARE
PREDICATED UPON SUCH A CONCLUSION.
UNDER PERTINENT PROVISIONS OF THE ARMED SERVICES PROCUREMENT
REGULATION IT WAS NECESSARY THAT YOUR PROTEST BE RECEIVED WITHIN FIVE
DAYS FOLLOWING THE CLOSING DATE FOR RECEIPT OF PROPOSALS IF IT WAS TO BE
CONSIDERED TIMELY AND MERIT REFERRAL TO SBA FOR A SIZE DETERMINATION. IN
THE INSTANT CASE, THE CONTRACTING OFFICER TREATED YOUR PROTEST AS
UNTIMELY, AND PURSUANT TO ASPR 1-703 (B) (1) (III), FORWARDED THE
PROTEST TO THE SBA ONLY FOR ITS CONSIDERATION IN REGARD TO FUTURE
PROCUREMENTS.
OUR DECISION B-163128, APRIL 24, 1968, WAS CONCERNED WITH A PROTEST
SIMILAR TO YOURS IN THAT IT WAS A PROTEST MADE AFTER AWARD OF A CONTRACT
NEGOTIATED UNDER A TOTAL SMALL BUSINESS SET-ASIDE. THE PROTESTANT HAD
ALLEGED THAT THE CONTRACT WAS IMPROPERLY AWARDED TO A FIRM AFFILIATED
WITH A LARGE BUSINESS. IN THAT DECISION, WE STATED:
"UNDER ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1-703 AND SMALL
BUSINESS ADMINISTRATION REGULATION (SBAR) 121.3-8 A CONTRACTING OFFICER
IS REQUIRED TO ACCEPT AT FACE VALUE FOR THE PARTICULAR PROCUREMENT
INVOLVED, A REPRESENTATION BY THE OFFEROR THAT IT IS A SMALL BUSINESS
CONCERN UNLESS A WRITTEN PROTEST IS RECEIVED CONCERNING THE SIZE STATUS
OF THE APPARENTLY SUCCESSFUL OFFEROR OR THE CONTRACTING OFFICER
QUESTIONS THE SMALL BUSINESS STATUS OF THE OFFEROR AND SUBMITS HIS
QUESTION TO SBA FOR DETERMINATION. SBAR 121.3-5 (A) STIPULATES THAT A
SIZE PROTEST WILL BE CONSIDERED TIMELY IF IT IS SUBMITTED TO THE
CONTRACTING OFFICER PRIOR TO THE FIFTH DAY, EXCLUSIVE OF SATURDAYS,
SUNDAYS AND LEGAL HOLIDAYS, AFTER PROPOSAL OPENING. AN OFFEROR
SUBMITTING A SIZE PROTEST WHICH IS RECEIVED AFTER AWARD IS TO BE
INFORMED THAT HIS PROTEST HAS BEEN REFERRED TO THE APPROPRIATE SBA
REGIONAL OFFICE FOR ITS CONSIDERATION IN FUTURE ACTIONS, WITH A NOTATION
THEREON THAT AN AWARD HAS BEEN MADE. SEE ASPR 1-703 (B) (1) (III).
"SINCE ASPR 3-508.3 (A) (NOW 3-507.2 (A) ( PROVIDES THAT THE IDENTITY
OF OFFERORS IN NEGOTIATED PROCUREMENTS SHALL NOT BE DIVULGED UNTIL AFTER
AN AWARD HAS BEEN MADE, EFFECTIVE PROTEST BY ANY OFFEROR AGAINST THE
SMALL BUSINESS STATUS OF ANOTHER IS VIRTUALLY PRECLUDED, AND THE
PROTECTION INTENDED TO BE PROVIDED BY THE PROTEST PROCEDURE AGAINST
IMPROPER AWARD TO AN OFFEROR NOT PROPERLY QUALIFIED AS A SMALL BUSINESS
IS LOST. THIS OBVIOUSLY TENDS TO THWART THE STATUTORY POLICY
ESTABLISHED BY THE SMALL BUSINESS ACT OF 1953, 15 U.S.C. 631-647, THAT A
-FAIR PROPORTION- OF THE GOVERNMENT'S TOTAL PURCHASES BE PLACED WITH
SMALL BUSINESS CONCERNS. ACCORDINGLY, WE ARE RECOMMENDING TO THE SBA
AND THE ASPR COMMITTEE THAT CORRECTIVE ACTION SHOULD BE TAKEN TO PROVIDE
A PRACTICAL PROCEDURE FOR CONTESTING SMALL BUSINESS SIZE CERTIFICATIONS
IN NEGOTIATED PROCUREMENTS PRIOR TO AWARD. WE ARE UNABLE, HOWEVER, TO
CONSIDER THE SUBJECT CONTRACT ILLEGALLY AWARDED BECAUSE OF THIS
CONSIDERATION, SINCE NEITHER THE STATUTE NOR THE IMPLEMENTING
REGULATIONS PRESENTLY CONTAIN ANY SPECIFIC REQUIREMENT FOR SUCH
PROCEDURE.' IN A SUBSEQUENT LETTER B-163128, OF MAY 27, 1968, TO THE
ADMINISTRATOR, SMALL BUSINESS ADMINISTRATION, WE COMMENTED:
"WE ARE PLEASED TO NOTE THAT AS A RESULT OF OUR SUGGESTION, THE SBA
SIZE APPEALS BOARD WILL CONSIDER A PROTEST IN A NEGOTIATED PROCUREMENT
AS TIMELY IF FILED WITHIN FIVE WORKING DAYS FROM THE DATE THE PROTESTING
OFFEROR HAS NOTICE OF THE AWARD. SUCH PROCEDURE SHOULD COMPENSATE FOR
THE LIKELIHOOD THAT THE PROTESTER WAS NOT AWARE OF THE PROTESTED
CONCERN'S PARTICIPATION IN THE PROCUREMENT UNTIL RECEIPT OF THE AWARD
NOTICE. WE APPRECIATE THAT YOU ARE NOT IN A POSITION TO COMPEL THE
CONTRACTING OFFICER TO AWAIT YOUR RULING, OR TO PREVENT THE MAKING OF AN
AWARD, BUT WE ARE HOPEFUL THAT THE ASPR COMMITTEE MAY SEE FIT TO
SUPPLEMENT YOUR AMENDMENT IN SUCH MANNER AS TO GIVE IT MEANINGFUL
EFFECT.'
THE PERTINENT ASPR AND SBAR PROVISIONS WERE ESSENTIALLY THE SAME AT
THE TIME OF YOUR PROTEST AS THEY WERE AS OF OUR LETTER OF MAY 27, 1968.
THE PROVISIONS OF BOTH REGULATIONS MUST BE CONSULTED TO DETERMINE THE
TIMELINESS OF AND THE PROCEDURES GOVERNING A SMALL BUSINESS SIZE STATUS
PROTEST IN ARMED SERVICES PROCUREMENTS. AT THE TIME OF AWARD TO WISDOM,
SBAR 121.3-5 (A) PROVIDED THAT A SIZE STATUS PROTEST IN NEGOTIATED
PROCUREMENTS WOULD BE TIMELY IF "FILED BY A BIDDER OR OFFEROR WITHIN 5
DAYS AFTER RECEIPT OF THE IDENTITY OF ANOTHER BIDDER OR OFFEROR FROM A
CONTRACTING OFFICER * * *.' THEREFORE, YOUR PROTEST OF JULY 1, 1969, WAS
TIMELY UNDER THE SBA REGULATIONS.
HOWEVER, ASPR HAD NOT UNDERGONE A CORRESPONDING REVISION, AND AS OF
THE DATE OF YOUR PROTEST, ASPR 1-703 (B) (1) PROVIDED THAT A SIZE
PROTEST "MUST BE RECEIVED BY THE CONTRACTING OFFICER PRIOR TO THE CLOSE
OF BUSINESS ON THE FIFTH WORKING DAY * * * AFTER BID OPENING DATE OR
CLOSING DATE FOR RECEIPT OF PROPOSALS.' SINCE THE CLOSING DATE FOR
RECEIPT OF PROPOSALS WAS JUNE 9, 1969, AND YOUR PROTEST WAS MADE ON JULY
1, IT WAS UNTIMELY. HOWEVER, UNDER ASPR 1-703 (B) (1) (III), YOUR
PROTEST WAS FORWARDED TO SBA FOR ITS CONSIDERATION IN FUTURE
PROCUREMENTS.
THE CONTRACTING OFFICER WAS REQUIRED TO ACCEPT WISDOM'S
SELF-CERTIFICATION OF SMALL BUSINESS STATUS UNLESS HE POSSESSED
INFORMATION TO THE CONTRARY. ROCK ISLAND ARSENAL PROCUREMENT RECORDS
IDENTIFIED WISDOM AS A SMALL BUSINESS. THERE WAS NO INFORMATION IN THE
PRE-AWARD SURVEY ON THAT FIRM INDICATING THAT IT HAD A PARENT FIRM OR
CORPORATE AFFILIATION WHICH WOULD DISQUALIFY IT AS A SMALL BUSINESS.
FURTHER, UNDER ASPR 1-703 (B) (1), QUOTED ABOVE, YOUR PROTEST WAS
UNTIMELY. UNDER THESE CIRCUMSTANCES, WE CAN FIND NO IMPROPRIETY IN THE
CONTRACTING OFFICER'S AWARD TO WISDOM AND HIS REFERRAL OF YOUR PROTEST
TO SBA FOR ITS CONSIDERATION IN LATER PROCUREMENTS. ACCORDINGLY, YOUR
PROTEST MUST BE DENIED.
AS A POINT OF INFORMATION, YOUR ATTENTION IS INVITED TO REVISION NO.
4, DATED AUGUST 29, 1969, TO THE 1969 EDITION OF ASPR WHICH MODIFIES
ASPR 1-703 (B) (1) AND 1-703 (B) (5) TO CONFORM TO SBAR 121.3-5 (A).
REVISION NO. 4 BECOMES EFFECTIVE 90 DAYS AFTER ITS ISSUANCE, ALTHOUGH
COMPLIANCE THEREWITH IS AUTHORIZED UPON ITS RECEIPT. THE EFFECT OF THE
REVISION, IN SITUATIONS SUCH AS THE INSTANT PROCUREMENT, WILL BE TO
REQUIRE THE CONTRACTING OFFICER TO NOTIFY UNSUCCESSFUL OFFERORS OF THE
IDENTITY OF THE FIRM TO WHICH AWARD IS PROPOSED. AWARD MUST THEN BE
WITHHELD UNTIL THE EXPIRATION OF A STATED PERIOD OF TIME, NOT LESS THAN
FIVE WORKING DAYS, DURING WHICH SIZE STATUS PROTESTS MAY BE RECEIVED.
UNDER THE REVISED REGULATIONS, IT WOULD THEREFORE APPEAR THAT A PROTEST
SUCH AS YOURS, MADE THE DAY AFTER YOU WERE NOTIFIED OF THE IDENTITY OF
THE SUCCESSFUL OFFEROR, WILL BE CONSIDERED TIMELY.
B-167821, OCT. 22, 1969
MISTAKES--ALLEGATION AFTER AWARD--UNILATERAL--ERRORS
CONTRACTOR, WHO AFTER AWARD FOR QUANTITIES OF PIPE, ALLEGES ERROR IN
PRICE OF 3 ITEMS BECAUSE OF CLERK'S ERRONEOUS COMPUTATION OF MARGIN OF
PROFIT -- DEDUCTING RATHER THAN ADDING 1.4 PERCENT OF COST -- MAY NOT BE
RELIEVED OF OBLIGATION TO FURNISH ITEMS AT CONTRACT PRICE AND NO BASIS
EXISTS FOR INCREASING CONSIDERATION, NOTWITHSTANDING ERROR IS
SUBSTANTIATED BY WORKSHEET AND SUPPLIER'S INVOICE, SINCE PRICE
DIFFERENCE WAS NOT SUFFICIENT TO PLACE CONTRACTING OFFICER ON NOTICE OF
LIKELIHOOD OF ERROR, RECORD DOES NOT ESTABLISH MISTAKE WAS MUTUAL, ERROR
DUE SOLELY TO OVERSIGHT OR NEGLIGENCE NOT CONTRIBUTED TO BY GOVERNMENT
IS UNILATERAL, AND ACCEPTANCE OF BID CONSUMMATED VALID AND BINDING
CONTRACT.
TO MAJESTIC PLUMBING AND HEATING SUPPLY CORP.:
REFERENCE IS MADE TO YOUR LETTER OF AUGUST 27, 1969, AND SUBSEQUENT
CORRESPONDENCE, REQUESTING RELIEF IN CONNECTION WITH AN ERROR ALLEGED TO
HAVE BEEN MADE IN YOUR BID UPON WHICH CONTRACT NO. GS-02S-6635 WAS
BASED.
THE GENERAL SERVICES ADMINISTRATION, FEDERAL SUPPLY SERVICE, NEW
YORK, NEW YORK, BY SOLICITATION NO. NY-2-JOF-1D-E-10049, REQUESTED BIDS
-- TO BE OPENED NOVEMBER 15, 1968 -- FOR FURNISHING DEFINITE QUANTITIES
OF DRIVE AND DRILLING LINE PIPE, COMMODITY GROUP NO. 47, ITEMS 1 THROUGH
13. BID PRICES WERE REQUESTED ON AN F.O.B. ORIGIN (EXPORT PACKED) BASIS
AND ON AN FAS VESSEL U.S. PORT OF EXIT (EXPORT PACKED) BASIS. IN
RESPONSE, YOU SUBMITTED A BID OFFERING TO FURNISH, AMONG OTHER ITEMS,
THE PIPE COVERED BY ITEMS 11, 12, AND 13 AT UNIT PRICES OF $5.5574,
$3.9455, AND $3.0522 PER FOOT, RESPECTIVELY, F.O.B. ORIGIN (EXPORT
PACKED) OR FAS U.S. PORT OF EXIT (EXPORT PACKED). BY APPLICATION OF THE
PROMPT PAYMENT DISCOUNT OF 7 PERCENT OFFERED BY YOUR FIRM, YOUR BID
BECAME THE LOWEST BID RECEIVED ON ITEMS 11, 12, AND 13. THE BID OF YOUR
FIRM WAS ACCEPTED AS TO ITEMS 11, 12, AND 13 (FAS VESSEL U.S. PORT OF
EXIT (EXPORT PACKED) ( ON DECEMBER 3, 1968.
BY LETTER DATED FEBRUARY 8, 1969, YOU ADVISED THE CONTRACTING OFFICE
THAT AN ERROR HAD BEEN MADE BY YOUR FIRM IN COMPUTING YOUR BID PRICES
FOR ITEMS 11, 12, AND 13 IN THAT INSTEAD OF ADDING 1.4 PERCENT OF THE
COST OF MATERIALS AS PROFIT, YOUR EMPLOYEE INADVERTENTLY DEDUCTED 1.4
PERCENT OF THE COST TO ARRIVE AT YOUR BID PRICES FOR THOSE ITEMS. YOU
REQUESTED THAT THE CONTRACT UNIT PRICE FOR ITEM 11 BE INCREASED FROM
$5.5574 TO $5.7157 PER FOOT; THAT THE CONTRACT UNIT PRICE FOR ITEM 12
BE INCREASED FROM $3.9455 TO $4.058 PER FOOT; AND THAT THE CONTRACT
UNIT PRICE FOR ITEM 13 BE INCREASED FROM $3.0522 TO $3.1391 PER FOOT. IN
SUPPORT OF YOUR ALLEGATION OF ERROR, YOU SUBMITTED A PHOTOSTATIC COPY OF
THE INVITATION WHICH YOU USED AS A WORKSHEET. AN EXAMINATION OF YOUR
WORKSHEET INDICATES THAT IN COMPUTING THE BID PRICES FOR ITEMS 11, 12,
AND 13, YOUR CLERK SHOULD HAVE ADDED RATHER THAN DEDUCTED 1.4 PERCENT OF
THE COST AS PROFIT. YOU ALSO SUBMITTED A COPY OF THE INVOICE YOU
RECEIVED FROM YOUR SUPPLIER, JONES AND LAUGHLIN STEEL CORPORATION.
THE PRIMARY QUESTION FOR CONSIDERATION IS NOT WHETHER AN ERROR WAS
MADE IN YOUR BID BUT WHETHER A VALID AND BINDING CONTRACT WAS
CONSUMMATED BY ITS ACCEPTANCE. THE CONTRACTING OFFICER HAS REPORTED
THAT HE HAD NO REASON TO SUSPECT AN ERROR IN YOUR BID. THE ABSTRACT OF
BIDS SHOWS THAT ON ITEM 11, THE NINE OTHER RESPONSIVE BIDDERS QUOTED
PRICES RANGING FROM $5.43 TO $6.60 PER FOOT; THAT ON ITEM 12 THEY
QUOTED PRICES RANGING FROM $3.8576 TO $4.90 PER FOOT; AND THAT ON ITEM
13 THEY QUOTED PRICES RANGING FROM $2.9842 TO $3.60 PER FOOT. IT ALSO
INDICATES THAT YOUR BID ON ITEMS 11, 12, AND 13 BECAME LOW ONLY BY
REASON OF THE PROMPT PAYMENT DISCOUNT OFFERED BY YOUR FIRM. YOU CONTEND
THAT THE DIFFERENCE OF 3.03 PERCENT BETWEEN YOUR PRICES ON ITEMS 11, 12,
AND 13 AND THE PRICES BID BY THE NEXT LOWEST BIDDER ON THOSE ITEMS,
ESPECIALLY IN VIEW OF THE AVERAGE PERCENTAGE INCREASE OF EACH SUCCEEDING
HIGHER BIDDER (0.94, 0.94, AND 0.92 FOR ITEMS 11, 12, AND 13
RESPECTIVELY), PLACED THE CONTRACTING OFFICER ON CONSTRUCTIVE NOTICE OF
THE PROBABILITY OF A MISTAKE IN YOUR BID. WHILE THE DIFFERENCE BETWEEN
YOUR BID AND THE NEXT LOWEST BID ON ITEMS 11, 12, AND 13 WAS GREATER
THAN THE DIFFERENCE BETWEEN EACH OF THE OTHER BIDS, WE CANNOT SAY THAT
SUCH PRICE DIFFERENCE, STANDING ALONE, WAS SUFFICIENT TO HAVE PLACED THE
CONTRACTING OFFICER ON NOTICE OF THE LIKELIHOOD OF ERROR IN YOUR BID.
ALTHOUGH, AFTER AWARD, YOU FURNISHED EVIDENCE TENDING TO SUPPORT YOUR
ALLEGATION OF ERROR, IT DOES NOT APPEAR THAT PRIOR TO AWARD THE
CONTRACTING OFFICER HAD KNOWLEDGE OF THE DIFFERENT FACTORS USED BY YOU
IN COMPUTING YOUR BID PRICES. THE ACCEPTANCE OF YOUR BID, IN THESE
CIRCUMSTANCES, CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE
RIGHTS AND LIABILITIES OF THE PARTIES THERETO.
THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED IN
RESPONSE TO THE INVITATION WAS UPON YOU AS THE BIDDER. FRAZIER-DAVIS
CONSTRUCTION COMPANY V UNITED STATES, 100 CT. CL. 120, 163. WHILE IT
MAY BE THAT AN ERROR WAS MADE IN THE BID, IT IS CLEAR THAT SUCH ERROR
WAS DUE SOLELY TO YOUR OWN OVERSIGHT OR NEGLIGENCE AND WAS IN NO WAY
INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. ANY ERROR THAT WAS MADE IN
THE BID WAS UNILATERAL -- NOT MUTUAL -- AND, THEREFORE, DOES NOT ENTITLE
YOU TO RELIEF. SEE EDWIN DOUGHERTY AND M. H. OGDEN V UNITED STATES, 102
CT. CL. 249; SALIGMAN ET AL. V UNITED STATES, 56 F.SUPP. 505; 20 COMP.
GEN. 652 AND 26 ID. 415.
ACCORDINGLY, NO LEGAL BASIS EXISTS FOR RELIEVING YOU FROM YOUR
OBLIGATION TO FURNISH ITEMS 11, 12, AND 13 AT THE CONTRACT PRICES OR FOR
INCREASING THE CONSIDERATION UNDER THE CONTRACT.
B-167934, OCT. 22, 1969
HUSBAND AND WIFE--DIVORCE--VALIDITY--FOREIGN
GENERAL RULE WITH RESPECT TO RECOGNITION OF DIVORCE DECREES SECURED
IN FOREIGN COUNTRIES IS THAT UNLESS FOREIGN COURT GRANTING DIVORCE HAD
JURISDICTION OVER SUBJECT MATTER BY REASON OF BONA FIDE RESIDENCE OR
DOMICILE OF AT LEAST ONE OF PARTIES DECREE WILL NOT, UNDER RULES OF
INTERNATIONAL COMITY, BE RECOGNIZED BY UNITED STATES COURTS, EVEN THOUGH
LAWS OF FOREIGN COUNTRY DO NOT MAKE RESIDENCE OR DOMICILE CONDITION TO
JURISDICTION AND IN ORDER TO ACQUIRE FOREIGN DOMICILE THERE MUST BE
ACTUAL RESIDENCE ON FOREIGN SOIL AND INTENT TO REMAIN THERE. MILITARY
PERSONNEL CAN ACQUIRE NEW DOMICILE WHILE STATIONED AT MILITARY
INSTALLATION FOR INITIATING DIVORCE SUIT, EVIDENCE OF INTENT IN THIS
REGARD BEING GIVEN GREAT WEIGHT.
TO MAJOR R. W. TUDOR, FC:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 27, 1969, WHICH
WAS FORWARDED HERE BY LETTER DATED SEPTEMBER 12, 1969, FROM THE OFFICE
OF THE COMPTROLLER OF THE ARMY REQUESTING AN ADVANCE DECISION AS TO THE
PROPRIETY OF PAYMENT OF A VOUCHER FOR $660.60 IN FAVOR OF A STAFF
SERGEANT, RETIRED, REPRESENTING BASIC ALLOWANCE FOR QUARTERS AT $110.10
PER MONTH FOR THE PERIOD FROM DECEMBER 1, 1968, TO MAY 31, 1969. YOUR
REQUEST HAS BEEN ASSIGNED D.O. NO. A-1048 BY THE DEPARTMENT OF DEFENSE
MILITARY PAY AND ALLOWANCE COMMITTEE.
YOU SAY THAT DEPENDENCY WAS ESTABLISHED FOR THE WIFE OF THE SERGEANT,
ON APRIL 2, 1951, THE DATE HE ENTERED ON ACTIVE DUTY, THE DATE OF THEIR
MARRIAGE BEING SHOWN AS APRIL 2, 1931 (1933), IN THE STATE OF WEST
VIRGINIA.
ON JANUARY 9, 1964, THE WIFE FILED SUIT FOR DIVORCE IN TEXAS. SHE
WAS AWARDED TEMPORARY ALIMONY IN THE AMOUNT OF $110.10 PER MONTH AND
THERE IS NO INDICATION THAT A FINAL DECREE OF DIVORCE WAS EVER ENTERED.
THE SERGEANT FILED SUIT FOR DIVORCE IN KOREA IN 1966. HIS WIFE WAS
SUBPOENAED TO APPEAR IN THE COURT. SHE MADE A SPECIAL APPEARANCE IN
WHICH SHE CONTESTED THE JURISDICTION OF THE COURT BECAUSE OF THE
PENDENCY OF SUIT IN THE TEXAS COURT. HOWEVER, THE KOREAN COURT VIEWED
HIS LONG RESIDENCE IN KOREA -- FROM 1962 TO 1964 AND FROM AN UNDISCLOSED
LATER DATE TO THE TIME HE FILED HIS DIVORCE ACTION -- AS ESTABLISHING
IT'S JURISDICTION IN THE MATTER AND GRANTED A DIVORCE ON APRIL 25, 1967.
APPARENTLY, THE COURT FOUND SOME ADDITIONAL EVIDENCE OF INTENT ON THE
SERGEANT'S PART TO MAKE KOREA HIS HOME SINCE THE DIVORCE DECREE RECITES
THAT UPON HIS RETURN TO AMERICA IN 1964 HE ASKED HIS WIFE TO RETURN TO
KOREA WITH HIM BUT SHE REFUSED.
ON MARCH 14, 1968, THE SERGEANT MARRIED IN KOREA. SHE HAD PREVIOUSLY
BEEN MARRIED TO A KOREAN FROM WHOM SHE WAS DIVORCED ON JULY 20, 1965.
SHE IS THE MOTHER OF A SON, BORN MARCH 13, 1964, AND A DAUGHTER, BORN
DECEMBER 15, 1967. THE SERGEANT IS THE PUTATIVE FATHER OF THOSE
CHILDREN.
ON APRIL 1, 1967, THE SERGEANT SUBMITTED AN ANNUAL APPLICATION FOR
BASIC ALLOWANCE FOR QUARTERS, DD FORM 137, ON ACCOUNT OF HIS FIRST WIFE.
HOWEVER, ON JUNE 6, 1967, HE SUBMITTED ANOTHER APPLICATION ON WHICH IT
WAS INDICATED THAT ENTITLEMENT NO LONGER EXISTED BECAUSE OF THE DIVORCE
DATED APRIL 25, 1967. YOU SAY HE ALSO STOPPED A CLASS E ALLOTMENT IN
THE AMOUNT OF $110 TO THE FIRST WIFE, EFFECTIVE WITH THE JULY 1967
PAYMENT.
ON FEBRUARY 8, 1968, HE SUBMITTED AN APPLICATION FOR BASIC ALLOWANCE
FOR QUARTERS ON WHICH IT WAS INDICATED THAT ENTITLEMENT ON ACCOUNT OF
THE FIRST WIFE EXISTED FROM APRIL 25, 1967, AND THAT BAQ HAD BEEN
ERRONEOUSLY TERMINATED ON THAT DATE. ALSO, ON FEBRUARY 8, 1968, HE
FURNISHED A STATEMENT TO SUBSTANTIATE PAYMENT OF FAMILY SEPARATION
ALLOWANCE, DD FORM 1561, AND SUCH ALLOWANCE WAS REINSTATED EFFECTIVE
APRIL 25, 1967. IN ADDITION, YOU SAY THAT HE ALSO REESTABLISHED A CLASS
E ALLOTMENT OF $110 PER MONTH TO HIS FIRST WIFE RETROACTIVE TO AUGUST
1967.
ON MARCH 28, 1968, THE MEMBER WAS AUTHORIZED TO RATION SEPARATELY
EFFECTIVE ON THAT DATE. ON APRIL 1, 1968, HE SUBMITTED AN ANNUAL
APPLICATION FOR BASIC ALLOWANCE FOR QUARTERS INDICATING ENTITLEMENT
CONTINUED TO EXIST ON ACCOUNT OF THE FIRST WIFE. YOU SAY THAT ON MAY
31, 1968, HE AGAIN TERMINATED THE CLASS E ALLOTMENT TO HER WITH THE LAST
DEDUCTION TO BE MADE IN JUNE 1968; THAT HE ESTABLISHED A CLASS E
ALLOTMENT OF $110 TO HIS KOREAN WIFE; AND THAT NO CHANGE WAS SUBMITTED
REGARDING BASIC ALLOWANCE FOR QUARTERS AT THAT TIME.
ON JULY 20, 1968, HE SUBMITTED AN APPLICATION FOR BASIC ALLOWANCE FOR
QUARTERS ON WHICH HE INDICATED ENTITLEMENT ON ACCOUNT OF HIS SECOND
WIFE, FROM MARCH 14, 1968, BASED ON HIS FINAL DECREE OF DIVORCE DATED
APRIL 25, 1967, AND HIS REMARRIAGE ON MARCH 14, 1968. YOU SAY A BASIC
ALLOWANCE FOR QUARTERS ON ACCOUNT OF THE SECOND WIFE WAS TERMINATED
EFFECTIVE DECEMBER 1, 1968, PENDING DECISION BY OUR OFFICE.
THE SERGEANT REQUESTED PERMISSION TO REMAIN IN KOREA AFTER RETIREMENT
ON JUNE 1, 1969, WHICH PERMISSION WAS GRANTED, AND HE APPARENTLY STILL
RESIDES IN THAT COUNTRY.
IN VIEW OF THE FOREGOING RECITATION OF THE FACTS IN THE CASE, YOU
HAVE ASKED DECISION ON THE FOLLOWING:
"A. IF KOREAN DIVORCE IS UPHELD WOULD MEMBER BE ENTITLED TO CREDIT
OF BASIC ALLOWANCE FOR QUARTERS ON BEHALF OF THE SECOND WIFE AS HIS
LEGAL DEPENDENT FROM 1 APRIL 1968?
"B. IF KOREAN DIVORCE IS UPHELD WOULD CREDIT FOR BASIC ALLOWANCE FOR
QUARTERS PAID FOR THE PERIOD 25 APRIL 1967 (DATE OF KOREAN DIVORCE)
THROUGH 13 MARCH 1968 (DAY PRIOR TO SECOND MARRIAGE) BE SUBJECT TO
RECOUPMENT OR ALLOWED TO BE RETAINED ON THE BASIS OF ENTITLEMENT FOR
DEPENDENT CHILD BORN OUT OF WEDLOCK ON 13 MARCH 1964?
"C. IF KOREAN DIVORCE IS NOT CONSIDERED VALID, MAY THE MEMBER BE
CREDITED WITH BASIC ALLOWANCE FOR QUARTERS ON AND AFTER 1 JULY 1968 ON
BEHALF OF THE FIRST WIFE AS HIS LEGAL WIFE, IN VIEW OF THE
DISCONTINUANCE OF CLASS E ALLOTMENT OF $110.00 FOR THE PURPOSE OF
SUPPORT WHICH WAS DISCONTINUED 30 JUNE 1968?
"D. IF KOREAN DIVORCE IS UPHELD WOULD MEMBER BE ENTITLED TO CREDIT
OF FAMILY SEPARATION ALLOWANCE TYPE II, WHICH HE RECEIVED FROM 25 APRIL
1967 THROUGH 13 (12) MARCH 1968 BASED ON HIS MARRIAGE TO FIRST WIFE? "
THE GENERAL RULE WITH RESPECT TO RECOGNITION OF DIVORCE DECREES
SECURED IN FOREIGN COUNTRIES IS STATED IN 36 COMP. GEN. 121, 122, AS
FOLLOWS:
"IT IS WELL ESTABLISHED THAT UNLESS A FOREIGN COURT GRANTING A
DIVORCE HAD JURISDICTION OVER THE SUBJECT MATTER OF THE DIVORCE BY
REASON OF BONA FIDE RESIDENCE OR DOMICILE THERE, OF AT LEAST ONE OF THE
PARTIES, ITS DECREE OF DIVORCE WILL NOT, UNDER THE RULES OF
INTERNATIONAL COMITY, BE RECOGNIZED IN ONE OF THE STATES OF THE UNITED
STATES, EVEN THOUGH THE LAWS OF SUCH FOREIGN COUNTRY DO NOT MAKE
RESIDENCE OR DOMICILE A CONDITION TO ITS COURT'S TAKING JURISDICTION.
ANNOTATION 143 A.L.R. 1312, AND CASES CITED.' TO ACQUIRE A FOREIGN
DOMICILE THERE MUST BE AN ACTUAL RESIDENCE ON FOREIGN SOIL AND AN INTENT
TO REMAIN THERE.
WHILE IT IS GENERALLY REGARDED THAT A SOLDIER OR SAILOR, IF HE IS
ORDERED TO A STATION TO WHICH HE MUST GO AND LIVE IN QUARTERS ASSIGNED
TO HIM, CANNOT ACQUIRE A DOMICILE SINCE HE MUST OBEY ORDERS AND CANNOT
CHOOSE TO GO ELSEWHERE, IT HAS BEEN RECOGNIZED THAT MILITARY PERSONNEL
CAN ACQUIRE A NEW DOMICILE WHILE STATIONED AT A MILITARY INSTALLATION
FOR INITIATING A SUIT FOR DIVORCE. EVIDENCE OF HIS INTENT IN THIS
REGARD IS GIVEN GREAT WEIGHT. SEE WALLACE V WALLACE, 89 A.2D 769 (1952)
AND THOMAS V THOMAS, 363 P.2D 107 (1961).
IT SEEMS REASONABLY CLEAR THAT THE SERGEANT'S LONG RESIDENCE IN KOREA
FURNISHED A SUBSTANTIAL BASIS FOR THE KOREAN COURT'S CONCLUSION THAT IT
HAD JURISDICTION OVER HIM AND WHILE THE FIRST WIFE DISPUTED THE COURT'S
JURISDICTION, SHE APPARENTLY HAS TAKEN NO ACTION TO CHALLENGE THE EFFECT
OF THE COURT'S DECREE. WHILE SUBSEQUENT EVENTS DO NOT ESTABLISH A PRIOR
INTENT, THEY MAY CONFIRM IT. HIS RELATIONSHIP WITH THE KOREAN WOMAN HE
LATER MARRIED AND HIS REQUEST FOR PERMISSION TO ESTABLISH RESIDENCY IN
KOREA UPON HIS RETIREMENT IN MAY 1969, LEND SUPPORT TO THE VIEW THAT HE
INTENDED TO MAKE HIS HOME IN THAT COUNTRY WHEN HE FILED SUIT FOR
DIVORCE. IN VIEW OF ALL THE CIRCUMSTANCES AND IN THE ABSENCE OF
EVIDENCE THAT THE DIVORCE DECREE HAS BEEN DECLARED A NULLITY BY A COURT
IN THE UNITED STATES OR THAT IT WAS NOT VALID ACCORDING TO THE LAWS OF
KOREA, IT IS OUR VIEW THAT THE KOREAN DIVORCE SHOULD BE RECOGNIZED AS
EFFECTIVELY DISSOLVING HIS MARRIAGE TO FIRST WIFE. COMPARE B-136190,
AUGUST 4, 1958, 38 COMP. GEN. 97, AND B-157707, SEPTEMBER 16, 1966, 46
COMP. GEN. 219. ACCORDINGLY, QUESTION C REQUIRES NO ANSWER.
AN EXAMINATION OF THE PAY ACCOUNT OF THE SERGEANT DISCLOSES THAT HE
WAS CREDITED WITH BASIC ALLOWANCE FOR QUARTERS AT THE RATE OF $110.10
PER MONTH FOR THE PERIOD FROM APRIL 1, 1967, THROUGH JUNE 30, 1968, ON
ACCOUNT OF HIS FORMER WIFE. CLASS E ALLOTMENT DEDUCTIONS IN THE AMOUNT
OF $110.10 PER MONTH WERE MADE FROM APRIL 1, 1967, THROUGH APRIL 30,
1968, AND AT THE RATE OF $110 PER MONTH FOR MAY AND JUNE 1968. HE ALSO
WAS CREDITED WITH FAMILY SEPARATION ALLOWANCE AT THE RATE OF $30 PER
MONTH FOR THE PERIOD FROM APRIL 1, 1967, THROUGH MARCH 12, 1968.
THE RECORD ALSO SHOWS THAT HE WAS CREDITED WITH BASIC ALLOWANCE FOR
QUARTERS AT THE RATE OF $110.10 PER MONTH FROM JULY 1, 1968, THROUGH
NOVEMBER 30, 1968, ON ACCOUNT OF HIS SECOND WIFE.
SUBSEQUENT TO THE KOREAN DIVORCE ON APRIL 25, 1967, THE SERGEANT
CEASED TO HAVE A DEPENDENT WIFE AND THEREAFTER HE WAS NOT ENTITLED TO
CREDIT FOR BASIC ALLOWANCE FOR QUARTERS UNTIL HE MARRIED HIS SECOND
WIFE, ON MARCH 14, 1968, AND HE CEASED TO BE ENTITLED TO FAMILY
SEPARATION ALLOWANCE AS OF APRIL 25, 1967.
ACCORDINGLY, QUESTION A IS ANSWERED IN THE AFFIRMATIVE AND QUESTION D
IN THE NEGATIVE.
HE WAS ENTITLED TO CREDIT FOR BASIC ALLOWANCE FOR QUARTERS ONLY FOR
SUCH PERIODS AS HE HAD A DEPENDENT OR DEPENDENTS ON WHOSE ACCOUNT THE
ALLOWANCE WAS CLAIMED. SINCE THE SON WAS BORN OUT OF WEDLOCK, HE WAS
NOT THE SERGEANT'S "UNMARRIED LEGITIMATE CHILD" AND THUS WAS NOT A
"DEPENDENT" WITHIN THE MEANING OF THAT TERM AS DEFINED IN 37 U.S.C. 401
(A). HENCE, THE AMOUNT CREDITED AS BASIC ALLOWANCE FOR QUARTERS FOR THE
PERIOD APRIL 25, 1967, THROUGH MARCH 13, 1968, SHOULD BE RECOUPED.
QUESTION B IS ANSWERED ACCORDINGLY.
WHILE THE SERGEANT IS ENTITLED TO BASIC ALLOWANCE FOR QUARTERS ON
ACCOUNT OF HIS WIFE, FOR THE PERIOD FROM MARCH 14, 1968, THROUGH MAY 31,
1969, PAYMENT ON THE VOUCHER MAY NOT BE MADE BECAUSE OF THE OVERPAYMENT
TO HIM OF $1,563.42 AS BASIC ALLOWANCE FOR QUARTERS AND $318 AS FAMILY
SEPARATION ALLOWANCE, OR A TOTAL OF $1,881.42, WHICH AFTER SETOFF OF THE
AMOUNT OF $660.60 PLUS $392.69 COVERING THE PERIOD MARCH 14 TO JUNE 30,
1968, A TOTAL OF $1,053.29, LEAVES A BALANCE OF $828.13 DUE THE UNITED
STATES. APPROPRIATE ACTION SHOULD BE TAKEN TO COLLECT THE LATTER AMOUNT
FROM HIM IN ACCORDANCE WITH 5 U.S.C. 5514.
THE VOUCHER FORWARDED WITH YOUR LETTER OF AUGUST 27, 1969, NOT BEING
PAYABLE, WILL BE RETAINED HERE.
B-167970, OCT. 22, 1969
TO MR. MACARIO M. MACASPAC:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF SEPTEMBER 1, 1969, IN
WHICH YOU STATE THAT SINCE YOUR DISCHARGE AS A PHILIPPINE SCOUT ON APRIL
8, 1947, YOU HAVE BEEN IN AND OUT OF EMPLOYMENT AND YOUR PRESENT
CIRCUMSTANCES ARE SUCH THAT UNLESS YOU RECEIVE HELP YOUR FAMILY MAY
SUFFER PRIVATION. YOU EXPRESS THE BELIEF THAT THE SOLDIERS' AND
SAILORS' CIVIL RELIEF ACT OF 1940, 54 STAT. 1181, PROVIDES FOR MATERIAL
AID TO EX-SERVICEMEN WHO ARE IN DIRE NEED OF ASSISTANCE AND REQUEST
ASSISTANCE UNDER THAT ACT.
THE SOLDIERS' AND SAILORS' CIVIL RELIEF ACT, 54 STAT. 1178, AS
AMENDED, 50 U.S.C. APP 501-599, PROVIDES GENERALLY FOR TEMPORARY
SUSPENSION OF LEGAL PROCEEDINGS AND TRANSACTIONS WHICH MAY PREJUDICE THE
RIGHTS OF PERSONS WHILE IN THE MILITARY SERVICE OF THE UNITED STATES.
THIS INCLUDES PROTECTION OF MILITARY PERSONNEL IN ACTIONS INVOLVING
NON-PAYMENT OF RENTS, INSURANCE PREMIUMS, INTEREST, TAXES AND
ASSESSMENTS WHILE IN THE MILITARY SERVICE.
SECTION 205 OF THE ACT, 54 STAT. 1181, 50 U.S.C. APP. 525, MODIFIES
THE BARRING ACT OF OCTOBER 9, 1940, 54 STAT. 1061, BY PROVIDING THAT THE
PERIOD OF MILITARY SERVICE SHALL NOT BE INCLUDED IN COMPUTING ANY PERIOD
LIMITED BY LAW FOR THE BRINGING OF ANY ACTION BY OR AGAINST ANY PERSON
IN MILITARY SERVICE. SINCE YOUR MILITARY SERVICE ENDED ON APRIL 8,
1947, THIS PROVISION HAS NO EFFECT ON THE RUNNING OF THE TEN-YEAR
LIMITATION PERIOD SET IN THE ACT OF OCTOBER 9, 1940, WITH RESPECT TO ANY
CLAIMS PERTAINING TO YOUR SERVICE. YOU WERE FULLY ADVISED OF THE
APPLICATION OF THE ACT OF OCTOBER 9, 1940, IN OFFICE LETTER OF SEPTEMBER
12, 1968, REGARDING YOUR CLAIM FOR MUSTERING-OUT PAY.
THE SOLIDERS' AND SAILORS' CIVIL RELIEF ACT MAKES NO PROVISION FOR
MATERIAL AID TO EX-SERVICEMEN OR VETERANS INSOFAR AS MONETARY ASSISTANCE
IS CONCERNED. ACCORDINGLY, THERE IS NO LEGAL BASIS UPON WHICH OUR
OFFICE OR ANY OTHER FEDERAL AGENCY MAY PROVIDE ANY MATERIAL AID OR
MONETARY ASSISTANCE UNDER THE PROVISIONS OF THE CITED ACT.
IF YOU BELIEVE THAT YOU MAY BE ENTITLED TO A PENSION BECAUSE OF A
SERVICE-CONNECTED DISABILITY, IT IS SUGGESTED THAT YOU CONTACT THE
UNITED STATES VETERANS ADMINISTRATION, WASHINGTON, D.C., FOR INFORMATION
IN THE MATTER.
B-168042, OCT. 22, 1969
POST OFFICE DEPARTMENT--LEASES--ADDITIONAL CHARGES--WATER, SEWERAGE,
ETC.
LOCAL POSTMASTER IMPROPERLY CERTIFIED WATER AND SEWERAGE BILLS ON
LEASED POSTAL FACILITY, RESULTING IN ERRONEOUS PAYMENT OF $372.09. WHILE
LESSORS HAVE REFUSED REIMBURSEMENT, REQUESTING GAO TO WAIVE REPAYMENT,
NO BASIS EXISTS FOR WAIVER AND ACTION SHOULD BE TAKEN TO COLLECT $372.09
BY SET-OFF FROM RENTAL PAYMENTS SINCE LEASE PROVISIONS IMPOSE OBLIGATION
ON LESSORS TO PROVIDE AND BE RESPONSIBLE FOR PAYMENT OF WATER AND
SEWERAGE CHARGES, GAO REGARDS PAYMENTS AS EXCESS PAYMENTS TO LESSORS,
AND GOVERNMENT HAS RIGHT TO RECOVER FUNDS ITS AGENTS HAVE ERRONEOUSLY OR
ILLEGALLY PAID; MOREOVER, ESTOPPEL MAY NOT BE INVOKED EVEN IN EVENT OF
LONG CONTINUANCE OF ILLEGAL OR ERRONEOUS OVERPAYMENTS BY GOVT.
TO MR. POSTMASTER GENERAL:
REFERENCE IS MADE TO A LETTER WITH ENCLOSURES DATED OCTOBER 2, 1969,
FROM THE ASSISTANT GENERAL COUNSEL, REAL PROPERTY AND PROCUREMENT
DIVISION, FURNISHING A REPORT RELATIVE TO THE REFUSAL OF CERTAIN LESSORS
TO REIMBURSE THE GOVERNMENT THE AMOUNT OF $372.09 WHICH IT ERRONEOUSLY
PAID FOR WATER AND SEWERAGE CHARGES INCURRED AT LEASED PREMISES HOUSING
THE SOUTH ELGIN, ILLINOIS, POSTAL FACILITY.
THE RECORD DISCLOSES THAT ON APRIL 3, 1958, THE POST OFFICE
DEPARTMENT ACCEPTED A PROPOSAL TO LEASE QUARTERS LOCATED IN SOUTH ELGIN,
ILLINOIS, SUBMITTED BY EDWIN G. HAAS, GEORGE HAAS, AND ANNA B. HAAS ON
FEBRUARY 4, 1958. THE RESULTANT LEASE, DATED FEBRUARY 2, 1960, WAS
RECORDED IN THE KANE COUNTY, ILLINOIS, RECORDS ON APRIL 5, 1960.
IT WAS DISCOVERED BY THE POSTAL DATA CENTER THAT THE WATER AND
SEWERAGE BILLS FOR THE TERM OF THE LEASE TO DATE TOTALING $372.09 HAD
BEEN ERRONEOUSLY PAID DUE TO IMPROPER CERTIFICATIONS OF THE BILLS BY THE
LOCAL POSTMASTER. THE LESSORS HAVE REFUSED TO REIMBURSE THE GOVERNMENT
AND HAVE REQUESTED THAT OUR OFFICE WAIVE REPAYMENT BECAUSE OF THE
GOVERNMENT'S MISTAKE.
PARAGRAPH 3 (A) OF THE PROPOSAL TO LEASE QUARTERS, EXECUTED BY THE
LESSORS, PROVIDES: "WE * * * FURTHER AGREE, IN CONSIDERATION OF THE
RENTAL HEREINBEFORE SPECIFIED:
"/A) TO FURNISH SATISFACTORY * * * WATER, * * * AND SEWERAGE SERVICE;
" IN THIS SAME REGARD, PARAGRAPH 6 OF THE LEASE EXECUTED BY THE LESSORS
REQUIRES IN PERTINENT PART THAT:
"6. THE LESSOR SHALL FURNISH TO THE GOVERNMENT, DURING THE OCCUPANCY
OF SAID PREMISES, UNDER THE TERMS OF THIS LEASE, AS PART OF THE RENTAL
CONSIDERATION, THE FOLLOWING:
"THE LESSOR SHALL PAY ALL TAXES AND WATER RATES, AND SHALL HAVE THIS
LEASE DULY RECORDED, AND SHALL PROPERLY PROTECT ALL DOORS AND WINDOWS,
ACCORDING TO REQUIREMENT. THE LESSOR SHALL FURNISH LIGHTING FIXTURES,
PLUMBING AND TOILET FACILITIES, AND GAS, WATER, AND ELECTRIC METERS, ALL
AS NOW INSTALLED IN THE DEMISED PREMISES; HEATING FIXTURES OF
SUFFICIENT SIZE AND CAPACITY TO HEAT THE BUILDING TO A UNIFORM
TEMPERATURE OF 70 DEGREES THROUGHOUT WHEN THE OUTSIDE TEMPERATURE IS THE
DESIGN TEMPERATURE IN GENERAL USE BY THE HEATING INDUSTRY FOR THIS
LOCALITY; SATISFACTORY WATER AND SEWERAGE SERVICE.'
CLEARLY THESE PROVISIONS IMPOSE AN OBLIGATION ON THE PART OF THE
LESSORS TO PROVIDE AND BE RESPONSIBLE FOR THE PAYMENT OF ALL WATER AND
SEWERAGE CHARGES INCURRED IN THE OPERATION OF THE POST OFFICE. WE REGARD
THE PAYMENT BY THE GOVERNMENT OF THE WATER AND SEWERAGE CHARGES TO BE,
IN EFFECT, EXCESS PAYMENTS TO THE LESSORS.
THE GOVERNMENT HAS THE RIGHT TO RECOVER FUNDS WHICH ITS AGENTS HAVE
WRONGFULLY, ERRONEOUSLY, OR ILLEGALLY PAID. THIS RIGHT EXISTS WHETHER
SUCH PAYMENTS ARE MADE UNDER A MISTAKE OF LAW OR FACT, WHETHER BECAUSE
IN EXCESS OF AUTHORITY OR BASED UPON AN ERRONEOUS INTERPRETATION OF A
CONTRACT LATER FOUND TO BE INCORRECT. B-157999, MARCH 28, 1966, AND
CASES CITED THEREIN. IN FANSTEEL METALLURGICAL CORPORATION V UNITED
STATES, 172 F.SUPP. 268 (1959) AT PAGE 271, THE COURT DISCUSSED
ERRONEOUS OVERPAYMENTS AND HELD:
"* * * THE SUPREME COURT HAS MANY TIMES HELD THAT ESTOPPEL MAY NOT BE
INVOKED AGAINST THE GOVERNMENT IN A SITUATION SUCH AS PRESENTED HERE * *
*. THIS IS ESPECIALLY SO SINCE, AS STATED EARLIER, WHERE MONEY IS
ALLEGEDLY ERRONEOUSLY PAID IT IS THE DUTY OF THE GOVERNMENT TO SUE FOR
ITS RETURN. FURTHER, LONG CONTINUANCE OF ILLEGAL OR ERRONEOUS
OVERPAYMENTS DOES NOT PREVENT THEIR RECOVERY EVEN WHEN CONTRACTUAL
RELATIONS ARE INVOLVED. NOR DOES IT MATTER HOW MUCH TIME ELAPSED BEFORE
THE ERROR OF OVERPAYMENT WAS DISCOVERED OR HOW LONG THE ACT TO RECOVER
IT WAS DEFERRED.' SEE ALSO B-165739, JULY 24, 1969; B-157999, SUPRA.
THE LEASE VESTED IN THE UNITED STATES A RIGHT OF OCCUPANCY OF THE
PREMISES FOR A CONSIDERATION WHICH INCLUDED WATER AND SEWERAGE SERVICES.
IT IS WELL ESTABLISHED THAT WITHOUT A COMPENSATING BENEFIT AGENTS AND
OFFICERS OF THE GOVERNMENT HAVE NO AUTHORITY TO SURRENDER OR WAIVE
VESTED CONTRACT RIGHTS. SEE SIMPSON V UNITED STATES, 172 U.S. 372;
UNITED STATES V AMERICAN SALES CORPORATION, 27 F.2D 389. THUS, NO LEGAL
BASIS EXISTS FOR WAIVING THE GOVERNMENT'S RIGHT TO RECOVERY OF THE
AMOUNT PAID FOR THE ACCOUNT OF THE LESSORS.
IN LIGHT OF THE AFOREGOING, AND SINCE REIMBURSEMENT OF THE CHARGES
ERRONEOUSLY PAID HAS BEEN REFUSED BY THE LESSORS, APPROPRIATE ACTION
SHOULD BE TAKEN TO COLLECT THE AMOUNT OF $372.09 BY SETOFF FROM RENTAL
PAYMENTS OTHERWISE DUE THE LESSORS.
B-164353, OCT. 21, 1969
COMPENSATION--WAGE BOARD EMPLOYEES--OVERTIME--TRAVEL TIME
WAGE BOARD EMPLOYEE ( ON SHIP CHECK TEAM AT SAN DIEGO), ORDERED TO
TRAVEL ON OR ABOUT MAR. 30, 1968 (SAT.) TO JAPAN TO DETERMINE
OVERHAULING OF U.S.S. KITTY HAWK, TRAVELED SATURDAY AND SUNDAY OVER 20
HOURS. NAVY ALLOWED OVERTIME FOR 13 HOURS 45 MINUTES ACTUAL WORK DURING
FLIGHT REVIEWING PREPARATORY DOCUMENTS AND DISALLOWED REMAINING
TRAVELTIME BECAUSE IT WAS NOT COVERED BY 5 U.S.C. 5544 (A) AS AMENDED
BY PUB. L. 90-206. GAO CONCURS IN DETERMINATION SINCE EMPLOYEE WAS NOT
ENTITLED TO OVERTIME PAY WHILE TRAVELING EXCEPT FOR REQUIRED WORK WHILE
TRAVELING, AND INTERVENING TRAVEL WAS NOT CAUSED BY TRAVEL DURING WHICH
WORK WAS PERFORMED; MOREOVER, OUTSIDE-DUTY-HOUR TRAVEL IS COMPENSABLE
AS OVERTIME ONLY WHEN WITHIN REQUIREMENTS OF 5 U.S.C. 5544 (A)
NOTWITHSTANDING 5 U.S.C. 6101 (B) (2).
TO MR. JOSEPH F. SAVELLI:
WE REFER TO YOUR LETTER OF JUNE 27, 1969, BY WHICH YOU REQUEST REVIEW
OF THE DENIAL OF CERTAIN OVERTIME PAY TO YOU DURING THE TRAVEL YOU
PERFORMED FROM SAN DIEGO, CALIFORNIA, TO TOKYO, JAPAN, ON MARCH 30 AND
31, 1968, AS AN EMPLOYEE OF THE DEPARTMENT OF THE NAVY.
WE HAVE RECEIVED A REPORT FROM THE OFFICE OF CIVILIAN MANPOWER
MANAGEMENT, DEPARTMENT OF THE NAVY, IN WHICH THE FACTS INVOLVED IN YOUR
CASE ARE STATED AS FOLLOWS: "WE ARE ADVISED THAT ON OR ABOUT 1 MARCH
1968, THE SUPERVISOR OF SHIPBUILDING, SAN DIEGO, WAS INFORMED THAT THE
USS KITTY HAWK WOULD BE IN PORT AT SUBIC BAY, PHILIPPINES, ON 2 APRIL
1968, FOR REPLENISHMENT. ACCORDINGLY, IT WAS DETERMINED THAT A SHIP
CHECK TEAM WOULD BE SENT TO SUBIC BAY TO DETERMINE THE EXTENT OF
OVERHAUL REQUIREMENTS FOR THE USS KITTY HAWK. MR. SAVELLI WAS TO BE A
MEMBER OF THE SHIP CHECK TEAM. SEVERAL DAYS BEFORE MR. SAVELLI WAS
SCHEDULED TO LEAVE, THE SUPERVISOR OF SHIPBUILDING, SAN DIEGO, RECEIVED
WORD THAT THE USS KITTY HAWK WOULD ARRIVE AT THE PORT IN YOKOSUKA,
JAPAN, INSTEAD OF SUBIC BAY ON 2 APRIL 1968, AND DEPART ON 6 APRIL 1968.
ACCORDINGLY, MR. SAVELLI WAS ISSUED TRAVEL ORDER NO. T-314/68 ON 25
MARCH 1968, AUTHORIZING HIM TO TRAVEL TO SUBIC BAY AND YOKOSUKA AND
RETURN WITH TRAVEL TO BEGIN ON OR ABOUT 30 MARCH 1968.'MR. SAVELLI'S
TRAVEL TO TOKYO BEGAN AT 0710, SATURDAY, 30 MARCH 1968, AND THE ARRIVAL
TIME AT TOKYO WAS 2015, SUNDAY 31 MARCH 1968. THE HOURS ACTUALLY SPENT
TRAVELING, INCLUDING THE USUAL WAITING TIME WHICH INTERRUPTED SUCH
TRAVEL, TOTALLED 20 HOURS AND 5 MINUTES. AN ADDITIONAL 2 HOURS WAS
SPENT GOING THROUGH CUSTOMS AND TRAVELING TO THE TEMPORARY DOMICILE IN
TOKYO. MR. SAVELLI DOES NOT INDICATE THE AMOUNT OF TIME ACTUALLY SPENT
TRAVELING FROM THE TERMINAL IN TOKYO TO THE TEMPORARY DOMICILE IN TOKYO.
HIS TRAVEL FROM TOKYO TO YOKOSUKA WAS PERFORMED ON MONDAY, 1 APRIL
1968, DURING HIS REGULAR DUTY HOURS. MR. SAVELLI PERFORMED 13 HOURS AND
45 MINUTES OF ACTUAL WORK DURING THE FLIGHT FROM SAN DIEGO TO TOKYO FOR
WHICH HE RECEIVED COMPENSATION. HE CONTENDS THAT HE SHOULD RECEIVE
COMPENSATION FOR THE TOTAL PERIOD OF TRAVEL TO HIS TEMPORARY DOMICILE IN
TOKYO AND, THEREFORE, IS DUE COMPENSATION FOR AN ADDITIONAL 8 HOURS AND
21 MINUTES.'
AS A WAGE BOARD EMPLOYEE, YOUR ENTITLEMENT TO OVERTIME COMPENSATION
IS GOVERNED BY 5 U.S.C. 5544 (A) AS AMENDED BY SECTION 222 (D) OF THE
ACT OF DECEMBER 16, 1967, PUBLIC LAW 90-206, 81 STAT. 641, WHICH
PROVIDES IN PERTINENT PART:
"* * * TIME SPENT IN A TRAVEL STATUS AWAY FROM THE OFFICIAL DUTY
STATION OF AN EMPLOYEE SUBJECT TO THIS SUBSECTION IS NOT HOURS OF WORK
UNLESS THE TRAVEL (I) INVOLVES THE PERFORMANCE OF WORK WHILE TRAVELING,
(II) IS INCIDENT TO TRAVEL THAT INVOLVES THE PERFORMANCE OF WORK WHILE
TRAVELING (III) IS CARRIED OUT UNDER ARDUOUS CONDITIONS, OR (IV) RESULTS
FROM AN EVENT WHICH COULD NOT BE SCHEDULED OR CONTROLLED
ADMINISTRATIVELY.'
YOU RECEIVED OVERTIME PAY FOR SOME OF THE HOURS OF YOUR TRAVEL
BECAUSE WHILE TRAVELING YOUR WERE REQUIRED TO REVIEW CERTAIN DOCUMENTS
YOU HAD IN YOUR POSSESSION IN PREPARATION FOR THE WORK YOU WERE TO
PERFORM IN JAPAN. HOWEVER, IT WAS DETERMINED BY THE DEPARTMENT OF THE
NAVY THAT THE TIME YOU SPENT TRAVELING WHILE YOU WERE NOT ACTUALLY
ENGAGED IN THE REVIEW OF SUCH DOCUMENTS WAS NOT COVERED BY THE QUOTED
LAW AND YOU WERE NOT PAID OVERTIME PAY FOR THAT TIME.
WE CONSIDER THAT DETERMINATION TO BE CORRECT. THE TRAVEL TIME
INTERVENING BETWEEN YOUR PERFORMANCE OF ACTUAL WORK MAY NOT BE
CONSIDERED AS INCIDENT TO TRAVEL INVOLVING THE PERFORMANCE OF WORK WHILE
TRAVELING. IN OTHER WORDS, THE INTERVENING TRAVEL WAS NOT CAUSED BY THE
TRAVEL DURING WHICH WORK WAS PERFORMED.
FURTHER, WE FIND NO INDICATION IN THE DOCUMENTS PRESENTED BY YOU OR
IN THE REPORT OF THE DEPARTMENT OF THE NAVY TO SUPPORT A HOLDING THAT
YOUR TRAVEL RESULTED FROM AN EVENT WHICH COULD NOT HAVE BEEN CONTROLLED
ADMINISTRATIVELY. THE DEPARTMENT SCHEDULED THE TIME AND PLACE OF THE
WORK YOU WERE TO PERFORM WELL IN ADVANCE. THE FACT THAT THE DEPARTMENT
SCHEDULED THE WORK AT A TIME WHICH REQUIRED YOUR TRAVEL OVER A WEEKEND
IN VIEW OF OTHER ADMINISTRATIVE CONSIDERATIONS IS NOT IN ITSELF
SUFFICIENT TO ENTITLE YOU TO OVERTIME PAY UNDER THE QUOTED PROVISION OF
LAW.
5 U.S.C. 6101 (B) (2) PROVIDES:
"/2) TO THE MAXIMUM EXTENT PRACTICABLE, THE HEAD OF AN AGENCY SHALL
SCHEDULE THE TIME TO BE SPENT BY AN EMPLOYEE IN A TRAVEL STATUS AWAY
FROM HIS OFFICIAL DUTY STATION WITHIN THE REGULARLY SCHEDULED WORKWEEK
OF THE EMPLOYEE.'
THAT PROVISION DOES NOT AUTHORIZE THE PAYMENT OF OVERTIME PAY IN THE
EVENT AN AGENCY HEAD FINDS IT IMPRACTICABLE TO SCHEDULE TRAVEL TIME
EXCLUSIVELY WITHIN AN EMPLOYEE'S NORMAL HOURS OF DUTY. IN SUCH CASES
THE TRAVEL IS REGARDED AS OVERTIME ONLY IF IT COMES WITHIN THE SPECIFIC
REQUIREMENTS SET FORTH IN 5 U.S.C. 5544 (A) PREVIOUSLY QUOTED.
UNDER THE APPLICABLE LAWS AS DISCUSSED ABOVE, YOU WERE NOT ENTITLED
TO OVERTIME PAY WHILE TRAVELING EXCEPT TO THE EXTENT THAT YOU WERE
REQUIRED TO PERFORM WORK WHILE TRAVELING.
REGARDING YOUR QUESTIONS RELATING TO DEPARTMENT OF THE NAVY POLICY
AND REGULATIONS, THOSE MATTERS APPEAR TO BE FOR THE CONSIDERATION OF
THAT DEPARTMENT UNDER THE PROVISIONS OF 5 U.S.C. 6101 (B) (2).
THEREFORE, WE MAKE NO COMMENT WITH REGARD THERETO.
COPIES OF THIS DECISION ARE BEING SENT TO CONGRESSMAN BOB WILSON AND
SENATOR ALAN CRANSTON WHO HAVE EXPRESSED AN INTEREST IN YOUR CASE.
B-166586, B-167027, B-167029, B-167336, B-167348, B-167438, OCT. 21,
1969
ROUTES--THROUGH--COMBINATION V THROUGH ROUTES
ON EXPLOSIVES SHIPMENTS FROM MACON, GA. TO CRANE, IND; WHERE CARRIER
CLAIMED COMBINATION OF MILEAGE RATES BASED ON 411 MILES TO DUBLIN, VA;
THENCE 490 MILES TO CRANE, GENERAL ACCOUNTING OFFICE PROPERLY
CONSTRUCTED COMBINATION THROUGH RATE BASED ON 599 SHORTLINE MILES TO
DAYTON, OHIO, IN ACCORDANCE WITH CARRIER'S TENDER I.C.C.-118-B, ROUTE 1,
PLUS 192 SHORTLINE MILES TO CRANE, AS AUTHORIZED IN CIW 56, OVER
BLUEFIELD, W. VA. (WHERE BOTH CARRIERS PUBLISH OPERATING RIGHTS), TO
TOTAL 725 MILES OR 25 MILES LESS THAN 125-PERCENT CIRCUITY LIMITATION IN
QUOTATION 118-B, AND MILEAGE OVER ACTUAL ROUTE OF MOVEMENT WAS
IMMATERIAL FOR COMPUTATION OF CHARGES, WHICH ARE BASED ON SHORTLINE
MILEAGE BETWEEN ORIGIN AND DESTINATION AS PROVIDED IN RULES OF GOVERNING
MILEAGE GUIDES.
TO C.I. WHITTEN TRANSFER COMPANY:
SUBJECT: GAO FILE CARRIER'S
NO. BILL NO.
-------- ---------
TK-883674 5087
TK-883679 5130
TK-885648 5105
TK-883678 5076
TK-885086 5113
TK-883677 5060
TK-883676 5094
TK-884498 5126
TK-881421 4970
TK-888046 5207-A
TK-887787 5218-A
TK-887790 5242-A
TK-887791 5261-A
TK-887792 5277-A
TK-888559 5083-SUPP. 1
TK-886007 5276-SUPPS. 1 AND 2
TK-886008 5268-SUPPS. 1 AND 2
TK-886003 5305-SUPPS. 1 AND 2
TK-886602 5175-SUPP. 2
TK-885924 5165-SUPPS. 2 AND 3
TK-885925 5162-SUPP. 1
TK-885923 5181-SUPP. 1
TK-885922 5209-SUPP. 1
TK-885920 5229-SUPP. 1
TK-885917 5251-SUPP. 1
TK-885842 5259-SUPPS. 1 AND 2
TK-885919 5244-SUPP. 1
TK-886006 5287-SUPPS. 1 AND 2
TK-885918 5247-SUPP. 1
TK-881317 5397-SUPP. 1
TK-885921 5224-SUPP. 1
TK-887789 5230-A
TK-888807 5364-A
TK-889727 5923-A
TK-890138 5183-B
TK-890992 5160-A
TK-891119 5278-A
IN YOUR SEVERAL LETTERS CONCERNING THE SUBJECT CLAIMS, YOU REQUEST
REVIEW OF THE DISALLOWANCES OF YOUR CLAIMS FOR ADDITIONAL CHARGES
ALLEGED TO BE DUE ON EACH OF NUMEROUS SHIPMENTS OF EXPLOSIVES BETWEEN
VARIOUS POINTS OF ORIGIN AND DESTINATION, LOCALLY VIA C.I. WHITTEN
TRANSFER COMPANY, OR JOINTLY WITH OTHER CARRIERS BETWEEN NOVEMBER 1966
AND SEPTEMBER 7, 1967.
FOR THE SERVICES PERFORMED -- WITH THE EXCEPTION OF THE SHIPMENTS
FROM MACON, GEORGIA, TO CRANE, INDIANA, DISCUSSED MORE FULLY HEREINAFTER
-- YOU ORIGINALLY CLAIMED AND WERE PAID, PRIOR TO AUDIT BY THE GENERAL
ACCOUNTING OFFICE, FREIGHT CHARGES COMPUTED ON THE BASES OF THE MILEAGE
RATES NAMED IN C.I. WHITTEN EXPLOSIVES TARIFF, MF-I.C.C. 53 OR 56
(HEREAFTER CIW 53 OR 56) FOR THE MILEAGE OVER THE ACTUAL ROUTE OF
MOVEMENT. THE APPLICABLE TARIFF DEPENDS ON THE DATE OF MOVEMENT. CIW
56 WAS EFFECTIVE ON AND AFTER DECEMBER 31, 1966. CIW 53 WAS IN EFFECT
AS TO THE INVOLVED EARLIER SHIPMENTS.
ON AUDIT OF THE PAYMENT VOUCHERS OUR OFFICE ISSUED NOTICES OF
OVERCHARGE (FORM 1003) FOR REFUND OF OVERCHARGES RESULTING FROM THE
APPLICATION OF RATES COMPUTED BY APPLYING THE SHORTLINE MILEAGE BETWEEN
ORIGINS AND DESTINATIONS, DERIVED FROM HOUSEHOLD MILEAGE GUIDES ISSUED
BY HOUSEHOLD GOODS CARRIERS BUREAU, TO THE TABLE OF MILEAGE RATES SET
OUT IN THE C.I. WHITTEN'S TARIFFS APPLICABLE ON THE DATE OF THE
MOVEMENT AND THE CHARGES WERE ADJUSTED ACCORDINGLY.
IN YOUR REQUESTS FOR REVIEW OF DISALLOWANCES OF YOUR SUPPLEMENTAL
CLAIMS BASED ON THE MILEAGE OVER THE ACTUAL ROUTE OF MOVEMENT, YOU
CONTEND THAT IN USING THE SHORTLINE MILEAGE FROM ORIGIN TO DESTINATION
ACCORDING TO THE HOUSEHOLD GOODS MILEAGE GUIDE, OUR OFFICE HAS: (1)
FAILED TO TAKE INTO CONSIDERATION THE MILEAGE VIA THE INTERCHANGE POINT
WITH THE CONNECTING CARRIER; (2) FAILED TO TAKE INTO CONSIDERATION THE
PROVISIONS OF ITEMS 130 OF TARIFFS CIW 53 AND 56, PROVIDING FOR
APPLICABILITY OF THE RATES OVER THE ROUTES AUTHORIZED; (3) FAILED TO
RECOGNIZE THE ROUTES AUTHORIZED BY ITEMS 220 OF THE TWO TARIFFS; AND
(4) FAILED TO TAKE INTO CONSIDERATION THE FIRST PARAGRAPH OF ITEMS 10 IN
THE TARIFFS.
ITEMS 10 OF BOTH TARIFFS ARE IDENTICAL AND ARE
ENTITLED,"PARTICIPATING CARRIERS OPERATING AUTHORITY," AND THE FIRST
PARAGRAPH STATES:
"THE RATES, RULES AND PROVISIONS PUBLISHED IN TARIFF, OR AS AMENDED,
APPLY ON BEHALF OF PARTICIPATING CARRIERS, ONLY TO THE EXTENT OF THE
AUTHORIZED OPERATING RIGHTS AS SET FORTH IN ITEMS NO. 10 THROUGH 35 AND
AMENDMENTS THERETO, AND DO NOT APPLY FROM OR TO ANY POINT OR PLACE NOT
AUTHORIZED.' THE ITEM THEN SETS FORTH, UNDER THE PARTICULAR CERTIFICATE
NUMBERS, THE OPERATING AUTHORITIES OF THE CARRIERS PARTY TO THE TARIFF.
THIS ITEM NOTIFIES THE SHIPPER OF THE TERRITORY WHICH THE PARTICIPATING
CARRIERS MAY SERVE.
ITEM 130, OF BOTH TARIFFS ENTITLED,"APPLICATION OF -THROUGH- RATES,"
PROVIDES:
"THE RATES PUBLISHED IN THIS TARIFF FOR LOCAL OR JOINT APPLICATION ON
THE COMMODITY TRANSPORTED OR TO BE TRANSPORTED OVER ANY ROUTE FROM POINT
OF ORIGIN TO DESTINATION IS THE APPLICABLE RATE OF THE PARTICIPATING
CARRIERS OVER THE ROUTE AUTHORIZED NOTWITHSTANDING THAT IT MAY BE HIGHER
THAN THE AGGREGATE OF INTERMEDIATE RATES OVER THE SAME ROUTE.' AND ITEM
220, OF BOTH TARIFFS TITLED,"ROUTES OVER WHICH RATES NAMED HEREIN
APPLY," NAMES POINTS BETWEEN WHICH THE RATES APPLY VIA
"/A) C.I. WHITTEN TRANSFER COMPANY," ALONE, INCLUDING OHIO, VIRGINIA
WEST VIRGINIA, AND INDIANA, (B) C.I. WHITTEN TRANSFER COMPANY (RICHMOND,
KENTUCKY, OR CHARLOTTE, NORTH CAROLINA,) - HUGHES TRANSPORTATION, INC.,
AND (C) C.I. WHITTEN TRANSFER COMPANY (LOUISVILLE, KENTUCKY,) - FALLS
CITIES TRANSFER AND STORAGE COMPANY, INCORPORATED.
IT IS YOUR POSITION THAT:
"IN ORDER TO DETERMINE THE APPLICABLE RATE OVER THE ROUTE AUTHORIZED
(AS PROVIDED IN ITEM 130 AND DEFINED IN ITEMS 10 AND 220) IT IS FIRST
NECESSARY TO COMPUTE THE MILEAGE OVER THAT ROUTE. THE RESULTANT
MILEAGE, WHEN APPLIED TO THE APPROPRIATE RATE TABLE IN THE TARIFF, THEN
DETERMINES THE APPLICABLE RATE.' HOWEVER, ITEM 130 MERELY PROVIDES THAT
THE RATES PUBLISHED IN THE TARIFFS OVER THE ROUTES AUTHORIZED ARE THE
APPLICABLE RATES, NOTWITHSTANDING THE FACT THAT THEY MAY BE HIGHER THAN
THE AGGREGATE OF INTERMEDIATE RATES OVER THE SAME ROUTES.
ITEM 50 OF THE TWO TARIFFS, ENTITLED,"GOVERNING PUBLICATIONS,"
INCORPORATES, EXCEPT AS PROVIDED IN THE TWO TARIFFS, THE HOUSEHOLD GOODS
CARRIERS BUREAU, INC., MILEAGE GUIDE. WE FIND NO PROVISION
IN THE TWO TARIFFS WHICH PRECLUDES APPLICATION OF THE HOUSEHOLD GOOD
CARRIERS BUREAU, INC., MILEAGE GUIDE AND HENCE SUCH GUIDE IS
INCORPORATED BY REFERENCE IN THE TARIFFS. RULES FOR THE DETERMINATION
OF MILEAGE ARE SPECIFICALLY SET FORTH IN THE MILEAGE GUIDE. UNDER THE
STATEMENT AS TO GENERAL PURPOSE, THE MILEAGE GUIDES STATE: "EVERY
REASONABLE SCIENTIFIC EFFORT HAS BEEN EMPLOYED TO DEVELOP MILEAGES
BETWEEN ALL POINTS VIA THE SHORTEST PRACTICAL TRUCK ROUTES. * * *" AND,
UNDER THE HEADING,"RULES -- MANNER OF USE," THE MILEAGE GUIDES PROVIDE,
IN PART, AS FOLLOWS:
"* * * DISTANCES BETWEEN ANY TWO POINTS SHALL BE DETERMINED BY USE OF
THE FOLLOWING RULES REGARDLESS OF MILEAGE THAT MAY BE DETERMINED TO
EXIST BY OTHER METHODS OF COMPILATION AND REGARDLESS OF ACTUAL ROUTE
WHICH CARRIER MAY SELECT TO PERFORM THE TRANSPORTATION SERVICE.'
THE RULES OF THE MILEAGE GUIDES WERE FOLLOWED BY OUR OFFICE IN THE
AUDIT, AND WE FIND NOTHING WHICH WOULD WARRANT ANY DIFFERENT METHOD OF
COMPUTATION IN YOUR TARIFFS AT THE TIME THE INVOLVED SHIPMENTS MOVED.
ITEMS 10 AND 220 TO WHICH YOU REFER CONCERN AUTHORIZED SERVICE AND
ROUTES, BUT HAVE NO EFFECT ON THE COMPUTATION OF CHARGES. SIMILAR
TARIFF PROVISIONS WERE THE SUBJECT OF CONTROVERSY IN M.I. O-BOYLE AND
SON, INC., V UNITED STATES, 157 CT. CL. 603 (1962) IN WHICH THE COURT
HELD THAT UNDER SUCH PROVISIONS THE SHORTEST ROUTE IS TO BE USED FOR
RATE-MAKING PURPOSES, REGARDLESS OF WHETHER IT IS THE ACTUAL ROUTE
CHOSEN BY THE CARRIER.
INCLUDED IN YOUR LETTERS ARE REQUESTS FOR REVIEW OF DISALLOWANCES OF
CLAIMS ON APPROXIMATELY 22 SHIPMENTS OF EXPLOSIVES FROM MACON, GEORGIA,
TO CRANE, INDIANA. SINCE NO THROUGH RATE WAS PUBLISHED FOR THIS
SERVICE, YOU CLAIM A COMBINATION OF MILEAGE RATES BASED UPON 411 MILES
MACON, GEORGIA, TO DUBLIN, VIRGINIA, USING BAGGETT TRANSPORTATION
COMPANY'S TARIFF NO. 15, MF-I.C.C. 130 (BAGGETT TARIFF 15 WAS NOT IN
EFFECT AT TIME OF THE MOVEMENTS; HOWEVER, TARIFF 11, MF-I.C.C. 125 WAS
IN EFFECT AND CONTAINS THE SAME AUTHORITY GENERALLY AS TARIFF 15);
THENCE, 490 MILES DUBLIN, VIRGINIA, TO CRANE, INDIANA, PUBLISHED IN CIW
56.
ON AUDIT OF THE VOUCHERS OUR OFFICE CONSTRUCTED A COMBINATION THROUGH
RATE COMPOSED OF $2.72 PER 100 POUNDS, MINIMUM WEIGHT 22,000 POUNDS,
BASED ON 599 SHORTLINE MILES MACON, GEORGIA, TO DAYTON, OHIO, PUBLISHED
IN CENTRAL AND SOUTHERN MOTOR TARIFF BUREAU AGENT, TARIFF 100-D,
MF-I.C.C. 287, RATE BASE 606, IN ACCORDANCE WITH THE PROVISIONS SET
FORTH IN C.I. WHITTEN TENDER I.C.C. 118-B, ROUTE 1; PLUS $1.68 PER 100
POUNDS, MINIMUM WEIGHT 22,000 POUNDS, BASED ON 192 SHORTLINE MILES
DAYTON, OHIO, TO CRANE, INDIANA, AS AUTHORIZED IN CIW 56. ROUTE 1 IN
PARAGRAPH 13, CIW TENDER I.C.C. 118-B IS SET FORTH AS: "/1) BAGGETT
TRANSPORTATION COMPANY - C.I. WHITTEN TRANSFER MPANY.'
YOU CONTEND THAT QUOTATION 118-B IS INAPPLICABLE UNDER THE PROVISIONS
OF NOTE 8, ITEM 13. NOTE 8, ITEM 13, C.I. WHITTEN TENDER I.C.C. 118-B,
PROVIDES:
"NO ROUTE IN THIS TENDER SHALL APPLY WHERE THE USE OF SUCH ROUTE
CAUSES CIRCUITY IN EXCESS OF 25 PERCENT OF THE SHORTEST MILEAGE BETWEEN
ORIGIN AND DESTINATION USING MILEAGE GUIDE NO. 8, MF-I.C.C. 139, FOR
THE COMPUTATION OF THE MILEAGE.' YOU ALLEGE THE ROUTING VIA DAYTON,
OHIO, IS EXCESSIVELY CIRCUITOUS BECAUSE,"THE SHORT LINE MILEAGE FROM
MACON, GEORGIA TO DAYTON, OHIO, IS, 599, WHICH ALLOWS FOR 125 PERCENT
CIRCUITY AMOUNTING TO 750 MILES. THE MILEAGE VIA BAGGETT TRANSPORTATION
O., FROM MACON, GEORGIA, TO DUBLIN, VIRGINIA, POINT OF INTERCHANGE WITH
WHITTEN TRANSFER CO., IS 411 MILES" AND "THE DISTANCE FROM DUBLIN VIA
WHITTEN TO DAYTON IS 399 MILES FOR A TOTAL OF 810 MILES.'
OUR OFFICE, HOWEVER, COMPUTED THE MILEAGE FROM MACON TO DAYTON OVER
BLUEFIELD, WEST VIRGINIA, SINCE BOTH BAGGETT TRANSPORTATION COMPANY
(BAGGETT) AND C.I. WHITTEN PUBLISH OPERATING RIGHTS AT BLUEFIELD IN
BAGGETT TARIFF NO. 14, MF-I.C.C. 128. COMPUTED OVER BLUEFIELD THE
MILEAGE IS 420 MILES FROM MACON, GEORGIA, TO BLUEFIELD AND 305 MILES
FROM BLUEFIELD TO DAYTON, OHIO, FOR A TOTAL OF 725 MILES, OR LESS THAN
125 PERCENT CIRCUITY.
IN YOUR REQUEST FOR REVIEW YOU PROTEST THE COMPUTATION OF MILEAGE
OVER BLUEFIELD, STATING:
"* * * ITEM 660 OF THIS TARIFF (BAGGETT TARIFF 14) PROVIDES FOR
ROUTES OVER WHICH THE RATES APPLY, AND NO THROUGH ROUTE IS PUBLISHED
BETWEEN THESE POINTS.' HOWEVER, NEMOURS, WEST VIRGINIA, IS 7 MILES FROM
BLUEFIELD IN THE ROUTE OF MOVEMENT. ITEM 660, BAGGETT TARIFF 14,
PARAGRAPH (D) SPECIFICALLY PROVIDES A ROUTE BETWEEN POINTS IN GEORGIA
AND POINTS IN OHIO VIA C.I. WHITTEN WITH INTERCHANGE AT NEMOURS, WEST
VIRGINIA. COMPUTED OVER NEMOURS THE MILEAGE IS 420 MILES MACON,
GEORGIA, TO BLUEFIELD, WEST VIRGINIA, 7 MILES BLUEFIELD TO NEMOURS, WEST
VIRGINIA, AND 298 MILES NEMOURS TO DAYTON, OHIO, FOR A TOTAL OF 725
MILES, WHICH IS 25 MILES LESS THAN THE MAXIMUM CIRCUITY. THEREFORE, CIW
TENDER 118-B IS APPLICABLE.
YOU ALSO ALLEGE THAT:
"* * * THE 192 MILES FROM DAYTON, OHIO, TO CRANE, INDIANA, UPON WHICH
THE CLAIM (OF THE GOVERNMENT) IS BASED IS ERRONEOUS. IT IS NECESSARY IN
SUCH A MOVEMENT FOR WHITTEN TO TRANSPORT THE SHIPMENT FROM A POINT IN
OHIO TO A POINT IN KENTUCKY WITHIN THE COMMERCIAL ZONE OF EVANSVILLE,
INDIANA UNDER ITS SUB-NO. 2, AND FROM EVANSVILLE TO CRANE UNDER ITS
SUB-NO. 85. SUCH A MOVEMENT WOULD TOTAL 443 MILES * * *.' AS ALREADY
SHOWN, HOWEVER, THE MILEAGE OVER THE ACTUAL ROUTE OF MOVEMENT IS
IMMATERIAL FOR THE COMPUTATION OF CHARGES, WHICH ARE BASED ON THE
SHORTLINE MILEAGE BETWEEN ORIGIN AND DESTINATION AS PROVIDED IN THE
RULES OF THE GOVERNING MILEAGE GUIDES.
B-167685, OCT. 21, 1969
NEGOTIATION--EVALUATION FACTORS--MANNING REQUIREMENTS
UNDER REQUEST FOR PROPOSALS FOR MESS ATTENDANT SERVICES WHICH
REQUIRED MANNING CHART SUBMISSION WITH PROPOSAL, OFFEROR'S PROTEST TO
AWARD AT HIGHER PRICE, CLAIMING CONTEMPLATED MANHOURS WERE ADEQUATE FOR
PERFORMANCE AND OPPORTUNITY FOR FURTHER DISCUSSION WAS REFUSED, IS
DENIED, SINCE MANNING CHART REPRESENTED OFFEROR'S BASIC APPROACH TO
PERFORMING SERVICES REQUIRED AND ALL RELEVANT FACTORS, INCLUDING LABOR
RESOURCES, WAGE RATES, NUMBER OF WORKERS AND TOTAL ESTIMATED LABOR HOURS
ARE NECESSARY FOR CONSIDERATION. TO ALLOW FURTHER DISCUSSIONS ON JUNE
23 (CUT-OFF DATE JUNE 25) IN FAIRNESS TO OTHER OFFERORS WOULD HAVE MEANT
FURTHER CONTEMPORANEOUS DISCUSSIONS WITH ALL OFFERORS OR OFFERORS'
NEGOTIATION POSTURE WOULD HAVE BEEN PREJUDICED AND CONTRACTING OFFICER'S
ACTION IN REFUSING FURTHER NEGOTIATION WAS PROPER.
TO ORBITING ENTERPRISES, INC.:
REFERENCE IS MADE TO YOUR LETTER OF JULY 31, 1969, PROTESTING AGAINST
THE AWARD OF A CONTRACT TO DYNAMIC ENTERPRISES, INC. (DYNAMIC), UNDER
REQUEST FOR PROPOSALS (RFP) NO. N00600-69-R-5236, ISSUED BY THE UNITED
STATES NAVY PURCHASING OFFICE, WASHINGTON NAVY YARD, WASHINGTON, D.C.
THE SUBJECT RFP, ISSUED ON MAY 23, 1969, SOLICITED OFFERS FOR
FURNISHING LABOR AND MATERIALS TO PERFORM MESS ATTENDANT SERVICES IN
BUILDING NO. 72 AT THE NAVAL STATION AND BUILDING NO. 166 AT THE
WASHINGTON NAVY YARD DURING THE PERIOD JULY 1, 1969, THROUGH JUNE 30,
1970. THE PROCUREMENT WAS A 100-PERCENT SET-ASIDE FOR SMALL BUSINESS
CONCERNS. A TOTAL OF 19 FIRMS WAS SOLICITED.
AS A PART OF THE RFP, EACH OFFEROR WAS REQUIRED BY SECTION 5.0 (A)
THEREOF TO SUBMIT A MANNING CHART SHOWING THE STAFFING LEVEL FOR EACH
BUILDING ESTIMATED BY THE OFFEROR AS BEING REQUIRED "TO SATISFACTORILY
PERFORM THE CONTRACT SERVICES.' SECTION 5.0 (A) PROVIDED THAT:
"SECTION 5.0 - NOTICES TO OFFERORS
"/A) ALL OFFERORS SHALL SUBMIT WITH THEIR PROPOSAL, A MANNING CHART
IN THE FORMAT OF FIGURE 1, ATTACHED, SHOWING THE ESTIMATED NUMBER OF
PERSONNEL REQUIRED IN EACH SPACE EACH HALF HOUR OF A REPRESENTATIVE
WEEKDAY TO SATISFACTORILY PERFORM THE CONTRACT SERVICES. NOTHING IN
THIS SECTION, OR ELSEWHERE IN THIS CONTRACT SHALL BE CONSTRUED AS
LIMITING THE CONTRACTOR'S RESPONSIBILITY FOR PROVIDING SUFFICIENT
PERSONNEL TO ACCOMPLISH ALL OF THE REQUIREMENTS SET FORTH HEREIN.'
WITH RESPECT TO THE MANNING CHART, SECTION 9.33 OF THE RFP PROVIDED
THAT:
"9.33 - STAFFING LEVELS (NUMBER OF EMPLOYEES)
"THE STAFFING LEVELS ENTERED BY THE CONTRACTOR ON THE MANNING CHART
(FIGURE 1) SHALL BECOME AN INTEGRAL PART OF THE CONTRACT, AND THE
CONTRACTING OFFICER MAY REQUIRE THAT THIS STAFFING LEVEL BE FULFILLED
SHOULD PERFORMANCE OFTHIS CONTRACT FALL BELOW ACCEPTABLE STANDARDS. THE
CONTRACTOR MAY BE REQUIRED TO MAKE MONETARY ADJUSTMENTS FOR ANY MANHOURS
LESS THAN THOSE SPECIFIED, SHOULD THE CONTRACTING OFFICER DETERMINE THAT
A LESS THAN SATISFACTORY LEVEL OF PERFORMANCE IS CAUSED BY PERSONNEL
STAFFING BELOW THAT SET FORTH IN FIGURE 1, MANNING CHART.'
ON JUNE 13, 1969, THE CLOSING DATE SET FOR RESPONSES TO THE RFP,
PROPOSALS WERE RECEIVED FROM 10 FIRMS. THE 10 INITIAL PROPOSALS, IN
TERMS OF PRICE AND MANHOUR STAFFING LEVELS, ARE REPORTED AS FOLLOWS:
MANHOURS
--------
BUILDINGS
OFFEROR PRICE 72 166
------- ----- ---------
INSTANT FOOD SERVICES $135,660.00 80 80
ORBITING ENTERPRISES 159,840.00 67-1/2 67-1/2
IRA GELBER 184,848.72 108 113-1/2
P.J.K. COMPANY 189,324.00 107-1/2 107-1/2
QUALITY MAINTENANCE CORP. 192,288.00 (NOT DETERMINABLE)
DYNAMIC ENTERPRISES, INC. 199,670.40 121 119
MILITARY BASE
MANAGEMENT, INC. 213,840.00 125 125
NATIONWIDE BUILDING
MAINTENANCE INC. 230,000.00 184 184
HUNTSVILLE FOOD SERVICE 238,802.02 95 95
MURCOLE 338,472.00 172-1/2 172-1/2
IT IS REPORTED THAT NEGOTIATIONS WERE THEN CONDUCTED WITH ALL 10
OFFERORS. IN THIS RESPECT, INSTANT FOOD SERVICES, ORBITING ENTERPRISES,
IRA GELBER, P.J.K. COMPANY AND HUNTSVILLE FOOD SERVICE WERE NOTIFIED
THAT THEIR STAFFING LEVELS WERE CONSIDERED LOW FOR THE WORK TO BE DONE.
MILITARY BASE MANAGEMENT, NATIONWIDE BUILDING MAINTENANCE AND MURCOLE
WERE NOTIFIED THAT THEIR STAFFING ESTIMATES WERE CONSIDERED HIGH.
QUALITY MAINTENANCE CORPORATION WAS NOTIFIED THAT ITS MANNING CHART WAS
INCONSISTENT AND REQUIRED CLARIFICATION. THE STAFFING LEVEL OF THE
MANNING CHART SUBMITTED BY DYNAMIC ENTERPRISES WAS CONSIDERED
APPROPRIATE AND DISCUSSION WAS HELD WITH DYNAMIC ONLY TO VERIFY ITS
OFFERED DISCOUNT OF 17 PERCENT. ALL OFFERORS WERE ADVISED THAT THEY HAD
THE OPPORTUNITY TO REVISE THEIR STAFFING LEVELS AND/OR PRICES ON THE
BASIS OF THE INFORMATION PROVIDED DURING THE NEGOTIATION DISCUSSIONS.
IN ORDER TO EFFECT AWARD OF A CONTRACT BY JUNE 30, 1969, THE ADVICE
AS TO PROPOSAL REVISIONS WAS TELEPHONICALLY COMMUNICATED TO ALL OFFERORS
ON JUNE 19, 1969. THEREAFTER, BY LETTER DATED JUNE 20, 1969, THE
CONTRACTING OFFICE ADVISED EACH OFFEROR THAT:
"IN ORDER TO PROVIDE FOR A COMMON CUT-OFF POINT FOR SUBMISSION OF
REVISIONS TO THE PROPOSALS, YOU ARE ADVISED THAT ANY REVISIONS YOU
DESIRE TO MAKE MUST BE RECEIVED IN THIS OFFICE, ATTENTION CODE P2.3, BY
4:00 P.M., EDT, 1969 JUNE 25.' THE LETTER ALSO INFORMED OFFERORS THAT
AFTER JUNE 25, 1969, NO INFORMATION OTHER THAN NOTICE OF UNACCEPTABILITY
OF PROPOSAL WOULD BE FURNISHED TO ANY OFFEROR UNTIL AWARD HAD BEEN MADE.
IT IS REPORTED THAT ON JUNE 23, 1969, MESSRS. FORD AND DUNN OF
ORBITING VISITED THE CONTRACTING OFFICE AND REQUESTED THE OPPORTUNITY TO
DISCUSS THEIR REVISED MANNING CHART AT THAT TIME. THEY WERE INFORMED
THAT THE CONTRACTING OFFICE WOULD PROVIDE NO MORE DEFINITE ADVICE THAN
THAT THEIR ORIGINAL ESTIMATE OF MANNING WAS CONSIDERED LOW. IN THIS
RESPECT, THE RFP HAD ENCOURAGED OFFERORS TO EXAMINE THE FACILITIES TO BE
SERVICED AND TO PROVIDE THEIR OWN ESTIMATE OF THE STAFFING LEVEL
REQUIRED TO PERFORM THE REQUIRED SERVICES. THE OFFEROR'S ESTIMATE WAS
TO BE USED AS AN INDICATION OF HIS UNDERSTANDING OF AND ABILITY TO
FULFILL THE REQUIREMENT.
ALL OFFERORS (EXCEPT P.J.K.) RESPONDED TO THE "CUT-OFF" LETTER OF
JUNE 20 AND SUBMITTED THEIR REVISED PROPOSALS PRIOR TO THE JUNE 25,
1969, DATE SET FOR CLOSING OF NEGOTIATIONS. AS A RESULT OF THE
NEGOTIATIONS CONDUCTED UNTIL JUNE 20, INSTANT FOOD SERVICES, ORBITING
ENTERPRISES AND HUNTSVILLE FOOD SERVICE INCREASED THEIR PROPOSED
STAFFING LEVELS. NATIONWIDE BUILDING MAINTENANCE, MILITARY BASE
MANAGEMENT AND MURCOLE REDUCED THEIR PROPOSED STAFFING LEVELS. QUALITY
MAINTENANCE CLARIFIED ITS PROPOSED MANNING SCHEDULE, DYNAMIC ENTERPRISES
CONFIRMED ITS OFFERED DISCOUNT AND IRA GELBER MADE NO CHANGE TO ITS
PROPOSAL AS ORIGINALLY SUBMITTED.
AFTER EVALUATION OF THE REVISED PROPOSALS, IT WAS ADMINISTRATIVELY
DETERMINED THAT THE PROPOSALS OF DYNAMIC ENTERPRISES, QUALITY
MAINTENANCE AND MILITARY BASE MANAGEMENT WERE CONSIDERED TECHNICALLY
ACCEPTABLE. IT IS REPORTED THAT THE ESTIMATED STAFFING LEVELS OF THE
TWO LOW OFFERORS, INSTANT FOOD SERVICES AND ORBITING ENTERPRISES, AS
MODIFIED BY RESUBMISSION, WERE CONSIDERED TO BE TOO LOW FOR ADEQUATE
PERFORMANCE OF THE SERVICES, THUS INDICATING A LACK OF UNDERSTANDING OF
THE REQUIREMENT. IN THIS RESPECT THE RECORD SHOWS THE FOLLOWING WITH
RESPECT TO THE THREE LOW OFFERORS:
BUILDING 72 BUILDING 166
MANHOURS PRICE MANHOURS PRICE TOTAL EVALUATED
----------------- ----------------- ----- --------- INSTANT
96 $80,400 96 $77,760 $158,160 $153,098.88 ORBITING EN
88,800 89 88,800 177,600 159,840.00 DYNAMIC ENTERPRISES
104,160 221,520 183,861.60 THE RECORD SHOWS THAT THE STAFFING LEVELS
OF QUALITY MAINTENANCE AT AN EVALUATED PRICE OF $188,442 AND MILITARY
BASE MANAGEMENT AT AN EVALUATED PRICE OF $203,040, AS FINALLY PROPOSED,
WERE 136 MANHOURS FOR BUILDING 72 AND 117 MANHOURS FOR BUILDING 166 AND
115 MANHOURS FOR EACH BUILDING, RESPECTIVELY. FROM THE FOREGOING, IT IS
APPARENT THAT YOUR FINAL OFFER WAS NOT IN FACT THE LOWEST SINCE INSTANT
FOOD SERVICES OFFERED A LOWER PRICE WITH MORE MANHOURS THAN DID
ORBITING. IN ANY EVENT, IT IS REPORTED THAT AN ANALYSIS OF THE MANNING
CHART SUBMITTED BY ORBITING INDICATED THE FOLLOWING REPORTED
DEFICIENCIES:
"1. THE CONTRACTOR OFFERED ONLY ONE (1) PERSON TO POLICE THE DINING
AREA DURING MEAL HOURS. REQUIRING ACTIVITY HAS INDICATED THAT AT LEAST
TWO (2) WOULD BE REQUIRED.
"2. NO PERSONNEL PROVIDED FOR PAN WASHING AFTER THE BREAKFAST MEAL.
"3. SUPERVISORS DOUBLE AS CASHIERS, LEAVING NO SUPERVISOR AVAILABLE
DURING MEAL HOURS.' ACCORDINGLY, AWARD OF CONTRACT WAS MADE ON JUNE 30,
1969, TO DYNAMIC ENTERPRISES AS THE LOWEST RESPONSIVE OFFEROR PROPOSING
A STAFFING LEVEL ADEQUATE FOR PERFORMANCE OF THE REQUIRED SERVICES.
IN YOUR PROTEST, YOU CONTEND THAT AWARD SHOULD NOT HAVE BEEN MADE TO
DYNAMIC AT A HIGHER PRICE THAN YOUR OFFER SINCE THE 89 MANHOURS PER DAY
WHICH YOU PLANNED TO UTILIZE IN EACH MESSING FACILITY IS ADEQUATE TO
PERFORM THE SERVICES REQUIRED. IN THIS CONNECTION, YOU MAINTAIN THAT
THE MANNING CHART IS ALMOST NEVER FOLLOWED ON CONTRACTS OF THIS TYPE AND
ONLY RARELY REQUIRED TO BE FOLLOWED WHEN PERFORMANCE BY AN ORGANIZATION
FALLS BELOW ACTUAL REQUIREMENTS. SECONDLY, YOU IMPLY THAT YOU WERE
DENIED THE OPPORTUNITY TO NEGOTIATE IN THAT YOU WERE NEVER ALLOWED TO
DISCUSS EITHER MONEY OR MANHOURS WITH NAVY PERSONNEL.
IN A NEGOTIATED PROCUREMENT, THE RULES OF FORMALLY ADVERTISED,
CMPETITIVE BIDDING, SUCH AS THE REQUIREMENT FOR AWARD TO THE LOWEST
RESPONSIVE, RESPONSIBLE BIDDER, ARE NOT CONTROLLING AND A CONTRACTING
OFFICER MAY TAKE INTO CONSIDERATION ALL FACTORS DEEMED ESSENTIAL TO THE
PROCUREMENT GOAL. WE VIEW THE INFORMATION TO BE SECURED FROM AN
OFFEROR'S MANNING CHART AS AN AID TO THE CONTRACTING OFFICER IN
DETERMINING WHETHER THE OFFEROR IS WITHIN A COMPETITIVE RANGE FOR
NEGOTIATION PURPOSES. IN THIS PROCUREMENT, MOREOVER, THE MANNING CHART
REPRESENTED THE OFFEROR'S BASIC APPROACH TO PERFORMING THE REQUIRED
SERVICES. THE GOAL OF THIS NEGOTIATED PROCUREMENT WAS TO PROCURE
SERVICES FROM A RESPONSIBLE SOURCE AT FAIR AND REASONABLE PRICES WHICH
ARE CALCULATED TO RESULT IN THE LOWEST ULTIMATE OVERALL COST TO THE
GOVERNMENT. SEE PARAGRAPH 3-801.1 OF THE ARMED SERVICES PROCUREMENT
REGULATION (ASPR). IN ADDITION, ASPR 3-806 (A) STATES THAT "THE
OBJECTIVE OF THE CONTRACTING OFFICER SHALL BE TO NEGOTIATE FAIR AND
REASONABLE PRICES IN WHICH DUE WEIGHT IS GIVEN TO ALL RELEVANT FACTORS,
INCLUDING THOSE IN 3-101.' ASPR 3-101 STATES THAT WHEN NEGOTIATIONS ARE
ENTERED INTO DUE ATTENTION SHALL BE GIVEN TO A NUMBER OF FACTORS,
INCLUDING "CONSIDERATION OF THE SOUNDNESS OF PROSPECTIVE CONTRACTORS'
MANAGEMENT OF LABOR RESOURCES, INCLUDING WAGE RATES, NUMBER OF WORKERS
AND TOTAL ESTIMATED LABOR HOURS.' ASPR 3-101 (XV). THUS, IT IS EVIDENT
THAT THE DETERMINATION OF AN APPROPRIATE LEVEL OF MANNING NECESSARY TO
PERFORM THE WORK UNDER A PROPOSED PROCUREMENT IS A LEGITIMATE AND PROPER
SUBJECT FOR NEGOTIATION. SEE B-166705, JULY 30, 1969.
CONTRARY TO YOUR VIEW, THE STAFFING LEVELS SUBMITTED BY A SUCCESSFUL
OFFEROR COULD BE STRICTLY ENFORCED BY THE CONTRACTING OFFICER UNDER
SECTION 9.33 OF THE RESULTING CONTRACT IF PERFORMANCE OF THE CONTRACT
FELL BELOW ACCEPTABLE STANDARDS. THUS, THE MANNING CHART IS AN
IMPORTANT MEASURE OF CONTRACT PERFORMANCE.
REGARDING YOUR CONTENTION THAT YOU WERE DENIED THE OPPORTUNITY TO
NEGOTIATE, ASPR 3-805.1 (A) REQUIRES THAT, AFTER RECEIPT OF INITIAL
PROPOSALS, DISCUSSIONS BE CONDUCTED WITH ALL OFFERORS WITHIN A
COMPETITIVE RANGE WITH CERTAIN EXCEPTIONS NOT HERE PERTINENT. THAT
REGULATION IMPOSES AN AFFIRMATIVE DUTY TO NEGOTIATE AND, IN THIS CASE,
THE NAVY PURCHASING OFFICE DID IN FACT NEGOTIATE WITH ALL OFFERORS UNTIL
JUNE 20, 1969. HOWEVER, IT IS OBVIOUS THAT WHEN NEGOTIATIONS ARE
CONDUCTED THEY MUST BE BROUGHT TO A CLOSE AT SOME POINT PRIOR TO AWARD
OF A CONTRACT. THE MANNER OF TERMINATING NEGOTIATIONS IS ESTABLISHED IN
ASPR 3-805.1 (B), WHICH STATES IN MATERIAL PART:
"* * * WHENEVER NEGOTIATIONS ARE CONDUCTED WITH SEVERAL OFFERORS,
WHILE SUCH NEGOTIATIONS MAY BE CONDUCTED SUCCESSIVELY, ALL OFFERORS
SELECTED TO PARTICIPATE IN SUCH NEGOTIATIONS (SEE (A) ABOVE) SHALL BE
OFFERED AN EQUITABLE OPPORTUNITY TO SUBMIT SUCH PRICE, TECHNICAL, OR
OTHER REVISIONS IN THEIR PROPOSALS AS MAY RESULT FROM THE NEGOTIATIONS.
ALL SUCH OFFERORS SHALL BE INFORMED OF THE SPECIFIED DATE (AND TIME IF
DESIRED) OF THE CLOSING OF NEGOTIATIONS AND THAT ANY REVISIONS TO THEIR
PROPOSALS MUST BE SUBMITTED BY THAT DATE. ALL SUCH OFFERORS SHALL BE
INFORMED THAT ANY REVISION RECEIVED AFTER SUCH DATE SHALL BE TREATED AS
A LATE PROPOSAL IN ACCORDANCE WITH THE -LATE PROPOSALS' PROVISIONS OF
THE REQUEST FOR PROPOSALS. (IN THE EXCEPTIONAL CIRCUMSTANCES WHERE THE
SECRETARY CONCERNED AUTHORIZES CONSIDERATION OF SUCH A LATE PROPOSAL,
RESOLICITATION SHALL BE LIMITED TO THE SELECTED OFFERORS WITH WHOM
NEGOTIATIONS HAVE BEEN CONDUCTED.) IN ADDITION, ALL SUCH OFFERORS SHALL
ALSO BE INFORMED THAT AFTER THE SPECIFIED DATE FOR THE CLOSING OF
NEGOTIATION NO INFORMATION OTHER THAN NOTICE OF UNACCEPTABILITY OF
PROPOSAL, IF APPLICABLE (SEE 3-508), WILL BE FURNISHED TO ANY OFFEROR
UNTIL AWARD HAS BEEN MADE.'
IN THIS CONNECTION, SINCE THE "CUT-OFF" DATE FOR SUBMISSION OF
REVISED PROPOSALS WAS JUNE 25, FURTHER NEGOTIATIONS POSSIBLY COULD HAVE
BEEN CONDUCTED WITH YOUR REPRESENTATIVES ON THEIR VISIT TO THE
CONTRACTING OFFICE ON JUNE 23, 1969. HOWEVER, IF FURTHER DISCUSSIONS
WERE HELD WITH YOUR REPRESENTATIVES AT THEIR INSISTENCE ON JUNE 23, IN
FAIRNESS TO THE OTHER OFFERORS, FURTHER CONTEMPORANEOUS DISCUSSIONS
WOULD HAVE HAD TO BE CONDUCTED WITH THEM. TO DO OTHERWISE WOULD HAVE
PREJUDICED THE NEGOTIATION POSTURE OF ALL OTHER OFFERORS. WITH AN AWARD
TO BE MADE BY JUNE 30 AND PERFORMANCE TO COMMENCE JULY 1, 1969, WE FEEL
THAT THE CONTRACTING OFFICER WAS ACTING WITHIN HER DISCRETION IN NOT
COMMENCING FURTHER NEGOTIATIONS WITH YOUR REPRESENTATIVES ON JUNE 23,
1969.
B-167729, OCT. 21, 1969
BILLS OF LADING--DESCRIPTION--RATE BASES
DENIAL OF CARRIER'S CLAIM FOR ADDITIONAL FREIGHT CHARGES ON SHIPMENT
OF INTERNAL COMBUSTION ENGINE ON BASIS ITEM 2250, ROCKY MOUNTAIN MOTOR
TARIFF BUREAU SECTION 22 QUOTATION I.C.C. NO. 18, HAS NO APPLICATION,
DENSITY OF SHIPMENT BEING MORE THAN 8 POUNDS PER CUBIC FOOT AND BILL OF
LADING (B/L) FAILING TO INCLUDE CERTIFICATE OF DENSITY OF SHIPMENT AS
REQUIRED BY ITEM 240 WHEN COMMODITY DESCRIPTION DEPENDS ON STATED
DENSITY, IS SUSTAINED. EVEN THOUGH REFERENCE ON B/L TO 207 CUBIC FEET
AND 3,950 POUNDS ACTUAL WEIGHT DID NOT COINCIDE WITH WORDING SET FORTH
IN ITEM 240 CERTIFICATE, THERE WAS SUBSTANTIAL COMPLIANCE WITH
REQUIREMENT, ANY LANGUAGE ADEQUATELY DENOTING DENSITY IN POUNDS PER
CUBIC FOOT IS LEGALLY ACCEPTABLE.
TO RED BALL MOTOR FREIGHT, INC.:
PLEASE REFER TO YOUR LETTER OF AUGUST 12, 1969, WITH ENCLOSURES,
REQUESTING REVIEW OF THE SETTLEMENT CERTIFICATE DATED AUGUST 5, 1969
(TK-890449), WHICH DISALLOWED YOUR CLAIM ON BILL NUMBERED 96007-A FOR
$10.66, REPRESENTING ADDITIONAL FREIGHT CHARGES CLAIMED FOR A SHIPMENT
DESCRIBED AS ENGINE INTERNAL COMBUSTION, NOI, RADIAL CYLINDER TYPE, NMFC
120820, WEIGHING 3,950 POUNDS. THE SHIPMENT WAS TRANSPORTED FROM NORTON
AIR FORCE BASE, CALIFORNIA, TO DALLAS AIRMOTIVE, INC., DALLAS, TEXAS,
UNDER GOVERNMENT BILL OF LADING D-3925570, DATED DECEMBER 21, 1967.
FOR THIS SERVICE YOU BILLED AND WERE PAID $234.63, BASED ON ROCKY
MOUNTAIN MOTOR TARIFF BUREAU SECTION 22 QUOTATION I.C.C. NO. 18, ITEM
22550, RATE BASIS "B," RATE SCALE 33. IN THE AUDIT OF THE PAYMENT
VOUCHER OUR TRANSPORTATION DIVISION ISSUED A NOTICE OF OVERCHARGE (FORM
1003), DATED JANUARY 24, 1969, IN THE AMOUNT OF $55.30. THE NOTICE WAS
LATER WITHDRAWN.
YOU NOW CONTEND THAT: "* * * ITEM 22550 OF THE U.S. GOVT. QUOTATION
I.C.C. 18, FIRST REVISED PAGE 93 HAS NO APPLICATION BECAUSE THE
DESCRIPTIVE ITEM READS -ENGINES, STEAM OR INTERNAL COMBUSTION OR PARTS;
INTERNAL COMBUSTION, RADIAL CYLINDER TYPE OR JET PROPULSION TYPE, WHEN
DENSITY OF SHIPMENT IS NOT LESS THAN 8 POUNDS PER CUBIC FOOT.- THE 16TH
REVISED PAGE 21, U.S. GOVERNMENT QUOTATION I.C.C. 18, ITEM 240 IS HEADED
-CERTIFICATION OF WEIGHT DENSITY BY SHIPPER- AND STATES -WHERE RATE
BASIS, ASSIGNMENTS FOR COMMODITIES DESCRIPTIONS DEPEND UPON A STATED
DENSITY, (POUNDS PER CUBIC FOOT), THE SHIPPER MUST CERTIFY THE FOLLOWING
ON THE BILL OF LADING AT THE TIME OF SHIPMENT; -ACTUAL DENSITY OF THE
SHIPMENT IS HEREBY STATED BY THE SHIPPER TO BE ---------- POUNDS PER
CUBIC FOOT.-"
THE GOVERNMENT BILL OF LADING, D-3925570, SHOWS A NOTATION, WHICH
READS "CU 207" AND THE ACTUAL WEIGHT IS SHOWN IN THE APPROPRIATE COLUMN
AS 3,950 POUNDS. THE INFORMATION THUS SUBSTANTIALLY COMPLIED WITH THE
REQUIREMENT SET FORTH IN ITEM 240 OF THE ROCKY MOUNTAIN MOTOR TARIFF
BUREAU QUOTATION NO. 18, SINCE THE TOTAL CUBE AND WEIGHT CLEARLY
INDICATE THAT THE DENSITY OF THE ENGINE SHIPPED EXCEEDED 8 POUNDS PER
CUBIC FOOT; IN FACT, THE DENSITY WAS IN EXCESS OF 19 POUNDS PER CUBIC
FOOT.
IT IS TRUE THAT THE REFERENCES ON THE BILL OF LADING TO 207 CUBIC
FEET AND 3,950 POUNDS ACTUAL WEIGHT DO NOT COINCIDE WITH THE WORDING SET
FORTH IN THE CERTIFICATE IN ITEM 240 OF QUOTATION 18; HOWEVER, WE DO
NOT BELIEVE IT IS ESSENTIAL THAT THE CERTIFICATE BE REPRODUCED IN THE
TERMS STATED IN THE QUOTATION; ANY LANGUAGE ADEQUATE TO DENOTE DENSITY
IN POUNDS PER CUBIC FOOT IS LEGALLY ACCEPTABLE. SEE CAMPBELL "66"
EXPRESS, INC. V UNITED STATES, 302 F.2D 270, 272 (1962); ALSO, OUR
DECISION B-166276, DATED JULY 22, 1969, SUSTAINING THE DISALLOWANCE OF
YOUR CLAIM NO. 73652 ON BILL NO. 90651-SUPP.
ACCORDINGLY, SINCE THERE WAS SUBSTANTIAL COMPLIANCE WITH THE
QUOTATION REQUIREMENT FOR A SHOWING ON THE BILL OF LADING OF THE NUMBER
OF POUNDS PER CUBIC FOOT, THE SETTLEMENT OF AUGUST 5, 1969, DISALLOWING
YOUR CLAIM FOR $10.66, IS SUSTAINED.
B-167456, OCT. 20, 1969
BIDDERS--QUALIFICATIONS--PREAWARD SURVEYS--FACILITY CAPABILITY REPORT
UPON PLANT FACILITIES SURVEY OF LOW BIDDER WHICH RECOMMENDED BIDDER
BE FOUND NONRESPONSIBLE, BASED ON LACK OF ADEQUATE CAPACITY AND
PERSONNEL, LACK OF FIRM COMMITMENTS FOR PARTS, QUESTIONABLE QUALITY
CONTROL AND HIGH PERCENTAGE OF DELINQUENCIES ON OTHER CONTRACTS,
AFFIRMED BY REINSPECTION OF FACILITIES, AND SMALL BUSINESS
ADMINISTRATION'S (SBA) REFUSAL TO ISSUE CERTIFICATE OF COMPETENCY (COC),
NO BASIS IS SHOWN FROM RECORD TO QUESTION CONTRACTING OFFICER'S
DETERMINATION OF NONRESPONSIBILITY AND BIDDER'S PROTEST IS DENIED. SINCE
SBA'S REFUSAL TO ISSUE COC MUST BE REGARDED AS PERSUASIVE WITH REGARD TO
COMPETENCY AND AS AFFIRMATION OF CONTRACTING OFFICER'S DETERMINATION OF
NONRESPONSIBILITY, SUCH DETERMINATION WILL NOT BE QUESTIONED BY GAO
ABSENT BAD FAITH OR LACK OF SUBSTANTIAL EVIDENCE.
TO STRASSER, SPIEGELBERG, FRIED, FRANK AND KAMPELMAN:
WE REFER TO YOUR LETTER OF JULY 10, 1969, AND SUBSEQUENT
CORRESPONDENCE ON BEHALF OF DELVA INDUSTRIES, INC., PROTESTING AGAINST
THE REJECTION OF THAT FIRM'S LOW BID ON SEVERAL ITEMS UNDER SOLICITATION
NO. FPNSO-E6-0505-A, ISSUED APRIL 15, 1969, BY THE FEDERAL SUPPLY
SERVICE, GENERAL SERVICES ADMINISTRATION, REGION 2, FOR THE PROCUREMENT
OF TUBE-TYPE FELT-TIP MARKERS.
BIDS WERE OPENED ON MAY 21, 1969. DELVA WAS LOW BIDDER ON ITEMS 1
THROUGH 8 AND 13 THROUGH 16. THE CONTRACTING OFFICER, IN ORDER TO
DETERMINE WHETHER DELVA MET THE STANDARDS OF RESPONSIBILITY SET FORTH IN
SECTION 1-1.310-5 OF THE FEDERAL PROCUREMENT REGULATIONS, REQUESTED A
PLANT FACILITIES SURVEY OF THAT BIDDER. ON JUNE 17, 1969, THE PLANT
FACILITIES REPORT RECOMMENDED THAT DELVA BE FOUND NONRESPONSIBLE, BASED
UPON A LACK OF ADEQUATE CAPACITY AND PERSONNEL, LACK OF FIRM COMMITMENTS
FOR SOME NECESSARY PARTS, QUESTIONABLE QUALITY CONTROL, AND A HIGH
PERCENTAGE OF DELINQUENCIES ON OTHER CONTRACTS. DELVA REQUESTED A
REINSPECTION OF ITS FACILITIES. A TEAM OF QUALITY CONTROL SPECIALISTS
REINSPECTED DELVA'S CAPACITY AND AFFIRMED THE EARLIER CONCLUSION THAT
DELVA WAS INCAPABLE OF PERFORMING.
IT IS YOUR CONTENTION THAT "THE CONCLUSIONS EXPRESSED IN THE
ADMINISTRATIVE REPORT ARE BASED ON ERRONEOUS FACTUAL ASSERTIONS
CONTAINED IN THE TWO PLANT FACILITIES SURVEYS * * * AND ARE THEREFORE
ARBITRARY, CAPRICIOUS AND NOT BASED ON SUBSTANTIAL EVIDENCE.'
THE FIRST GROUND OF YOUR PROTEST IS THAT THE SURVEY REPORTS'
DETERMINATIONS IN REGARD TO PLANT CAPABILITY IGNORE PROPOSED
MODIFICATIONS OF THE EXISTING EQUIPMENT WHICH WOULD HAVE INCREASED
PRODUCTION BY 25 PERCENT. HOWEVER, AT THE TIME OF THE SURVEY, DELVA WAS
UNABLE TO FURNISH SPECIFIC PLANS ON DESIGN, CAPACITY, DELIVERY DATE, OR
COST. THEREFORE, THE INSPECTORS CONCLUDED THAT CALCULATIONS COULD NOT BE
MADE ON ANY BUT THE EXISTING MACHINERY.
YOU FURTHER STATE THAT THE SURVEY'S COMPUTATION, WHICH FOUND THAT CAP
AND PLUG PRODUCTION WOULD BE 10 PERCENT SHORT OF CONTRACT REQUIREMENTS,
IS BASED ON AN ASSUMED 20-DAY PRODUCTION MONTH, WHEREAS DELVA PLANS TO
PRODUCE ON 22 DAYS PER MONTH. HOWEVER, THE CALCULATION WAS ALSO BASED
ON DELVA'S ESTIMATE THAT IT IS ABLE TO PRODUCE 46,000 CAPS AND PLUGS A
DAY. THIS PROJECTION WAS CONSIDERED BY THE QUALITY CONTROL SPECIALIST
TO BE "TOTALLY UNREALISTIC SINCE IT DOES NOT REFLECT ACTUAL CONDITIONS
OR ALLOWANCES FOR MACHINE BREAKDOWN, DIE CHANGES, RELIEF PERIODS,
EMPLOYEE ABSENTEEISM, ETC.'
THE SECOND BASIS OF YOUR PROTEST IS THAT, CONTRARY TO THE FINDINGS OF
THE REPORT, DELVA HAS THE REQUIRED ASSEMBLY CAPABILITY. THE SURVEY
FOUND, HOWEVER, THAT DELVA COULD NOT ASSEMBLE 50,000 MARKERS DAILY BY
HAND SINCE IT HAD NO PREVIOUS STEADY PRODUCTION EXPERIENCE; THAT IT
COULD NOT PROVIDE ANY DATA TO SUBSTANTIATE AN ESTIMATED PRODUCTION OF 52
MARKERS A MINUTE; AND THAT IT MUST RECRUIT, TRAIN AND RETAIN PERSONNEL
FROM A LABOR FORCE WITH A RECORD OF HIGH ABSENTEEISM AND FREQUENT
TURNOVER. FURTHER, WHILE DELVA ADVISED THE SURVEY TEAMS THAT IT PLANNED
TO HAVE A MACHINE BUILT TO ASSEMBLE THE MARKERS, IT OFFERED NEITHER
VERIFIABLE EVIDENCE OF INTENT TO PURCHASE NOR SPECIFIC PLANS ON DESIGN,
CAPACITY, DELIVERY DATE, OR COST.
WE HAVE NO INFORMATION ON THE WILLINGNESS OF THE NATIONAL INDUSTRIES
FOR THE BLIND TO HANDLE THE ASSEMBLY OF THE PENS. IF DELVA WAS ABLE TO
DEMONSTRATE TO THE SURVEY TEAMS THAT THE NATIONAL INDUSTRIES FOR THE
BLIND WAS ABLE TO COMPLETE THE ASSEMBLY WORK WITHIN THE TIME AND COST
LIMITS REQUIRED BY THE CONTRACT, THE SURVEY TEAMS WOULD HAVE, OF COURSE,
CONSIDERED THIS INFORMATION IN THEIR EVALUATION OF DELVA'S
RESPONSIBILITY.
THE THIRD BASIS OF YOUR PROTEST IS THAT DELVA DOES NOT LACK FIRM
COMMITMENTS FOR ANY NECESSARY PARTS. THE REPORTS STATE, HOWEVER, THAT
DELVA DID NOT VERIFY ITS ABILITY TO OBTAIN CERTAIN PARTS AND THAT FOR
THOSE PARTS FOR WHICH PROOF OF FIRM COMMITMENTS WERE PRESENTED, NO
INFORMATION WAS AVAILABLE AS TO ALTERNATIVE SOURCES IN THE EVENT OF
DELIVERY PROBLEMS.
FURTHER, FELT NIBS ALREADY SUPPLIED BY THE CONTINENTAL FELT COMPANY
TO DELVA WERE USED IN THE HANDMADE BID SAMPLES. THAT COMPANY IS UNABLE
TO SUPPLY THE FELT NEEDED FOR THIS PROCUREMENT. AT THE TIME OF THE
SURVEY, DELVA CONTENDED THAT THE STANDARD FELT COMPANY COULD SUPPLY THE
FELT BUT OFFERED NO VERIFICATION. ATTACHED TO YOUR LETTER OF SEPTEMBER
8, 1969, IS A STATEMENT BY STANDARD FELT THAT IT IS PREPARED TO SUPPLY
THE QUANTITIES OF FELT NEEDED. EVEN SO, THE SURVEY DETERMINED THAT
DELVA'S ABILITY TO DESIGN AND BUILD MACHINERY SUITABLE FOR CONVERTING
THE FELT, WHICH IT INTENDED TO BUY FROM STANDARD FELT IN COIL FORM, INTO
NIB FORM IS "DOUBTFUL.'
THE FOURTH GROUND OF YOUR PROTEST IS THAT THE ADMINISTRATIVE REPORT'S
CONCLUSION THAT DELVA HAS QUESTIONABLE QUALITY CONTROL IS "A COMPLETE
FABRICATION NOT SUPPORTED BY THE SURVEY REPORTS.' THE
SECOND SURVEY STATES, HOWEVER, THAT DELVA PRESENTED NO FORMAL PLAN O
OUTLINE TO ASSURE QUALITY CONTROL. IT ALSO STATES THAT THE PRODUCTION
MANAGER IS TO SERVE AS THE QUALITY CONTROL MANAGER AND THAT WITH THE
VOLUME OF ACTIVITY ESTIMATED, IT WOULD BE "PHYSICALLY IMPOSSIBLE" FOR
HIM TO PERFORM BOTH JOBS ADEQUATELY. FURTHER, DELVA'S TEST APPARATUS
DOES NOT HAVE THE ABILITY TO APPLY WEIGHT BY SPRING-APPLIED PRESSURE ON
THE NIB OF TEST SPECIMENS AS REQUIRED BY PARAGRAPH 4.33 OF THE
SPECIFICATIONS.
YOUR FINAL OBJECTION TO THE ADMINISTRATIVE REPORT IS THAT NO EVIDENCE
WAS GIVEN IN THE SURVEY REPORTS TO SUSTAIN A FINDING THAT DELVA HAS BEEN
DELINQUENT ON ITS OTHER CONTRACTS WITH THE GOVERNMENT. HOWEVER, DELVA
WAS LATE IN DELIVERING 12 OUT OF 30 ORDERS OF BALLPOINT PENS UNDER
CONTRACT NO. GS-00S-63149; 14 OUT OF 26 ORDERS OF BALLPOINT PEN BARRELS
UNDER CONTRACT NO. GS-00S-63157; AND 32 OUT OF 40 ORDERS OF MECHANICAL
PENCILS UNDER CONTRACT NO. GS-00S-63326. WHILE IT MAY BE TRUE, AS YOU
ALLEGE, THAT "NO TOTAL AMOUNTS ARE GIVEN," THE FAILURE TO DELIVER 60
PERCENT OF THESE ORDERS WHEN DUE IS SUFFICIENT TO SUSTAIN A FINDING THAT
DELVA IS FREQUENTLY DELINQUENT, ESPECIALLY SINCE DELVA WAS UNABLE TO
JUSTIFY ITS DELAYS TO THE SATISFACTION OF THE PLANT FACILITIES SURVEY
TEAMS. THE REPORTS FURTHER INDICATE THAT DELVA'S HOUSEKEEPING WAS POOR.
UPON RECEIPT OF THE SECOND SURVEY REPORT, THE CONTRACTING OFFICER
REQUESTED THE SMALL BUSINESS ADMINISTRATION (SBA) TO PROCEED WITH ITS
STUDY OF DELVA. ON AUGUST 5, 1969, SBA DECLINED TO ISSUE A CERTIFICATE
OF COMPETENCY (COC) BASED UPON A COMPREHENSIVE ANALYSIS OF ALL AVAILABLE
INFORMATION.
WE HAVE HELD THAT THE REFUSAL OF SBA TO ISSUE A COC MUST BE REGARDED
AS PERSUASIVE WITH REGARD TO COMPETENCY AND AS AFFIRMATION OF THE
CONTRACTING OFFICER'S DETERMINATION OF NONRESPONSIBILITY. 39 COMP. GEN.
705.
WE HAVE CONSISTENTLY HELD THAT IT IS THE RESPONSIBILITY OF THE
CONTRACTING OFFICER TO DETERMINE THE RESPONSIBILITY OF A BIDDER (37
COMP. GEN. 430; 38 ID. 248; 39 ID. 468; 43 ID. 228), AND THAT SUCH
DETERMINATION WILL NOT BE QUESTIONED BY OUR OFFICE IN THE ABSENCE OF BAD
FAITH OR A LACK OF SUBSTANTIAL EVIDENCE. 39 COMP. GEN. 705; 43 ID.
228. WE BELIEVE THAT ON THE RECORD BEFORE US THERE IS NO BASIS TO
QUESTION THE CONTRACTING OFFICER'S DETERMINATION IN THIS CASE.
B-166275(1), OCT. 17, 1969
BIDDERS--QUALIFICATIONS--PREAWARD SURVEYS--ACCEPTANCE OF FINDINGS
UNDER SOLICITATION FOR COMPLEX RADAR SYSTEM SPECIFYING NEW
ENGINEERING CONCEPTS, CRITICAL DELIVERY REQUIREMENTS, AND THAT OFFEROR'S
TECHNICAL EXPERTISE AND EXPERIENCE WOULD BE CONSIDERED, CONTRACTING
OFFICER'S (C.O.) DETERMINATION THAT SMALL BUSINESS OFFEROR WAS
NONRESPONSIBLE, ALTHOUGH PREAWARD SURVEY CONTAINING NEGATIVE COMMENTS
WAS FAVORABLE OVERALL, WAS NOT ARBITRARY OR CAPRICIOUS WHEN BASED ON
NEGATIVE REPORT BY PURCHASING AGENCY WITH INTIMATE KNOWLEDGE AND
EXPERTISE OF END ITEM, AS C.O. IS NOT BOUND BY PREAWARD SURVEY AND COULD
REASONABLY CONCLUDE THAT PROTESTANT INDICATED INABILITY TO UNDERSTAND
TECHNICAL REQUIREMENTS; ALSO, IN VIEW OF FACTUAL BASIS SUPPORTING
EXIGENCY DETERMINATION AND FACT THAT TWO SMALL BUSINESS CONCERNS WITH
LOWER OFFERS WERE REJECTED, ASPR 1-1705.4C DOES NOT REQUIRE C.O. TO
REFER MATTER TO SBA.
TO WACHTEL, WIENER AND ROSS:
REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 13, 1969, WITH
ENCLOSURE, AND PRIOR CORRESPONDENCE, ON BEHALF OF REPUBLIC ELECTRONICS
INDUSTRIES CORP., PROTESTING AGAINST THE AWARD OF A CONTRACT TO
ELECTROMAGNETIC TECHNOLOGY CORP., UNDER REQUEST FOR PROPOSALS (RFP) NO.
DAAA25-69-R-0148, ISSUED BY THE DEPARTMENT OF THE ARMY, FRANKFORD
ARSENAL, PHILADELPHIA, PENNSYLVANIA. YOU REQUEST THAT THE AWARD TO
ELECTROMAGNETIC TECHNOLOGY CORP., A LARGE BUSINESS CONCERN, BE SET ASIDE
AND THAT THE AWARD BE MADE TO REPUBLIC AS THE LOWEST RESPONSIVE AND
RESPONSIBLE SMALL BUSINESS OFFEROR. YOU CONTEND THAT THE CONTRACTING
OFFICER'S DETERMINATION THAT REPUBLIC WAS NONRESPONSIBLE FOR PURPOSES OF
THIS PROCUREMENT WAS ARBITRARY AND CAPRICIOUS.
THE FACTS IN THIS CASE AS ADMINISTRATIVELY REPORTED ARE AS FOLLOWS.
A PRESOLICITATION NOTICE WAS ISSUED BY FRANKFORD ARSENAL ON SEPTEMBER
23, 1968, TO 32 POTENTIAL SOURCES FOR CERTAIN REQUIREMENTS IN SUPPORT OF
THE 20MM ANTIAIRCRAFT ARTILLERY GUN, XM163 (SELF-PROPELLED) AND XM167
(TOWED).
THE PRESOLICITATION NOTICE INCLUDED AN ANNOUNCEMENT OF A PREPROPOSAL
CONFERENCE TO BE HELD AT FRANKFORD ARSENAL SHORTLY AFTER THE ISSUANCE OF
THE RFP FOR THE PURPOSE OF PROVIDING PROSPECTIVE OFFERORS WITH AN
EXPLANATION AND DISCUSSION OF THE TECHNICAL AND CONTRACTUAL
REQUIREMENTS.
A DETAILED SYNOPSIS OF THE PROPOSED PROCUREMENT WAS PUBLISHED
NATIONWIDE IN THE DEPARTMENT OF COMMERCE BUSINESS DAILY ON SEPTEMBER 27,
1968. THE SYNOPSIS INCLUDED THE ANNOUNCEMENT OF THE PREPROPOSAL
CONFERENCE AND INSTRUCTIONS FOR ATTENDANCE. IT EXPRESSED THE
GOVERNMENT'S SEARCH FOR ,INTERESTED FIRMS POSSESSING SUPERIOR
CAPABILITIES AND EXPERIENCE IN SUCH RELATED FIELDS AS X-BAND MICROWAVE,
DOPPLER RADARS, ELECTROMAGNETIC COMPATIBILITY REQUIREMENTS AND DIGITAL
HARDWARE EXPERIENCE.'
THE RECORD INDICATES THAT THE PROCUREMENT WAS ASSIGNED A UNIFORM
MATERIEL MOVEMENT AND ISSUE PRIORITY SYSTEM (UMMIPS) DESIGNATOR 02
BECAUSE OF URGENT SOUTHEAST ASIA REQUIREMENTS FOR THE EQUIPMENT AND THAT
THE REQUEST FOR PORPOSALS WAS ISSUED PURSUANT TO 10 U.S.C. 2304 (A) (2),
THE EXCEPTION WHICH PERMITS NEGOTIATION INSTEAD OF FORMAL ADVERTISING
WHERE THERE IS A PUBLIC EXIGENCY.
THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) 3-202.2 (VI), WHICH
IMPLEMENTS 10 U.S.C. 2304 (A) (2), PROVIDES THAT WHEN AN 02 PRIORITY
DESIGNATOR IS ASSIGNED TO A PROCUREMENT, THE "PUBLIC EXIGENCY" EXCEPTION
MAY BE USED. SEE ALSO, 10 U.S.C. 2310 (B).
THE RFP WAS ISSUED ON OCTOBER 3, 1968, TO 32 PROSPECTIVE SOURCES AND
WAS SUBSEQUENTLY FURNISHED TO OTHER PROSPECTIVE SOURCES WHICH RESPONDED
TO THE PUBLISHED SYNOPSIS AND OTHER TRADE MEDIA. THE RFP INCLUDED ON
PAGE 1 A "CAVEAT" ADVISING ALL OFFERORS THAT THIS SOLICITATION
REPRESENTED THE INITIAL COMPETITIVE PROCUREMENT OF THE ITEMS DESCRIBED
IN THE RFP. WITH RESPECT TO THE PREAWARD SURVEY FACTORS APPLICABLE TO
THIS PROCUREMENT, PAGE 39 OF THE RFP PROVIDED IN PERTINENT PART AS
FOLLOWS:
"2. IN ADDITION TO THE STANDARDS SET FORTH AT ASPR 1-903.1 AND
1-903.2, OR AS EXPANSION THEREOF, THE FACTORS SET FORTH BELOW APPLY TO
ALL OFFERORS AND WILL BE CONSIDERED BY THE GOVERNMENT IN DETERMINING
RESPONSIBILITY:
"A. LENGTH OF EXPERIENCE IN X BAND MICROWAVE DESIGN AND PRODUCTION,
PARTICULARLY IN THE FIELD OF DOPPLER RADARS.
"B. LENGTH OF EXPERIENCE IN DIGITAL HARDWARE PRODUCTION,
PARTICULARLY IN THE 7.5 MHZ REGION.
"C. PRODUCTION AND/OR DESIGN EXPERIENCE FOR EQUIPMENT THAT MEET THIS
ELECTRO-MAGNETIC COMPATIBILITY REQUIREMENT OF MIL-STD-461.
"D. DISTRIBUTION OF COST ELEMENTS REFLECTED ON DD FORM 633 AND
SUPPORTING DATA.'
THE PREPROPOSAL CONFERENCE WAS HELD AT FRANKFORD ARSENAL ON OCTOBER
17, 1968. OFFERORS ATTENDING THE CONFERENCE WERE PROVIDED WITH A
DETAILED EXPLANATION OF THE CONTRACTUAL REQUIREMENTS, PARTICULARLY THE
PREPRODUCTION EVALUATION OF THE TECHNICAL DATA AND THE DESIGN AND
PERFORMANCE CHARACTERISTICS OF THE EQUIPMENT, INCLUDING A DISPLAY OF
ACTUAL PRODUCTION UNITS. RESPECTING PREPRODUCTION EVALUATION (PPE),
PAGE 7 OF THE RFP PROVIDED AS FOLLOWS:
"PRIOR TO, OR IN CONJUNCTION WITH PROCESS PLANNING, TOOL DESIGN,
DEVELOPMENT OF INSPECTION PLANS AND PROCEDURES, AND DESIGN OF INSPECTION
EQUIPMENT, AND THROUGHOUT THE PRODUCTION AND INSPECTION PHASES OF THE
CONTRACT, THE CONTRACTOR SHALL PERFORM A DETAILED REVIEW OF ALL
TECHNICAL DATA FURNISHED UNDER THE CONTRACT FOR THE PURPOSE OF
IDENTIFYING AND PROPOSING THE CORRECTION OF ANY DISCREPANCY, ERROR,
OMISSION, OR DEFICIENCY IN DESIGN OR TECHNICAL DATA WHICH MAY PRECLUDE
PRACTICAL MANUFACTURE OR ASSEMBLY, OR WHICH MAY PRECLUDE THE ATTAINMENT
OF REQUIRED PERFORMANCE AS SET FORTH IN SPECIFICATIONS:" BY AMENDMENT
NO. 003 TO THE RFP, THE CLOSING DATE WAS EXTENDED FROM NOVEMBER 29,
1968, TO DECEMBER 10, 1968. OF THE 15 OFFERS RECEIVED AND OPENED ON
DECEMBER 10, 1968, THE SEVEN LOWEST OFFERS, AS EVALUATED, WERE AS
FOLLOWS:
(1) G. C. DEWEY CORP. $8,718,306.40
(2) COSMOS INDUSTRIES, INC. 8,930,813.46
(3) REPUBLIC ELECTRONICS INDS. CORP. 9,073,329.55
(4) POLARAD ELECTRONICS CORP. 9,220,368.04
(5) FREQUENCY ENGINEERING LABS. 9,322,151.51
(6) APPLIED DEVICES CORP. 9,736,655.00
(7) ELECTROMAGNETIC TECHNOLOGY CORP. 9,845,627.93
THE LOW OFFER OF THE G. C. DEWEY CORP. WAS REJECTED BECAUSE THE FIRM
WAS DETERMINED TO BE NONRESPONSIBLE. ALSO THE BIDS OF YOUR FIRM, COSMOS
INDUSTRIES, INC., POLARAD, FREQUENCY ENGINEERING LABS. AND APPLIED
DEVICES CORP. WERE REJECTED BECAUSE THE CONTRACTING OFFICER HAD
DETERMINED THAT YOUR FIRM AND THE OTHER COMPANIES WERE NONRESPONSIBLE
FOR PURPOSES OF THIS PROCUREMENT. ON FEBRUARY 19, 1969, A CONTRACT WAS
AWARDED TO ELECTROMAGNETIC TECHNOLOGY CORP. IN THE AMOUNT OF
$9,845,627.93.
YOU PROTEST THE CONTRACTING OFFICER'S DETERMINATION THAT REPUBLIC IS
NOT A RESPONSIBLE OFFEROR AND CONTEND THAT THE CONTRACTING OFFICER HAS
BY HIS ACTIONS EVIDENCED "ARBITRARY AND CAPRICIOUS" ACTION. YOU CONTEND
THAT SINCE REPUBLIC WAS DETERMINED TO BE A RESPONSIBLE PROSPECTIVE
CONTRACTOR BY THE DEFENSE CONTRACT ADMINISTRATION SERVICES DIVISION
(DCASD), GARDEN CITY, NEW YORK, AND SINCE ITS PROPOSAL WAS LOWER THAN
ELECTROMAGNETIC'S PROPOSAL PRICE, IT SHOULD HAVE RECEIVED THE AWARD. IN
YOUR LETTER OF AUGUST 13, 1969, YOU CONTEND THAT THE CONTRACTING
OFFICER'S DECISION IN THE CASE OF REPUBLIC WAS NOT BASED ON FACTUAL
EVIDENCE BECAUSE ALL THE CONTRACTING OFFICER HAD BEFORE HIM WAS THE
PREAWARD SURVEY REPORT.
ASPR 1-902 TREATS THE QUESTION OF CONTRACTOR RESPONSIBILITY AS
FOLLOWS:
"1-902 GENERAL POLICY. PURCHASES SHALL BE MADE FROM, AND CONTRACTS
SHALL BE AWARDED TO, RESPONSIBLE PROSPECTIVE CONTRACTORS ONLY. A
RESPONSIBLE PROSPECTIVE CONTRACTOR IS ONE WHICH MEETS THE STANDARDS SET
FORTH IN 1-903.1 AND 1-903.2, AND SUCH SPECIAL STANDARDS AS MAY BE
PRESCRIBED IN ACCORDANCE WITH 1-903.3 AND BY OVERSEAS COMMANDERS. THE
AWARD OF A CONTRACT TO A SUPPLIER BASED ON LOWEST EVALUATED PRICE ALONE
CAN BE FALSE ECONOMY IF THERE IS SUBSEQUENT DEFAULT, LATE DELIVERIES OR
OTHER UNSATISFACTORY PERFORMANCE RESULTING IN ADDITIONAL PROCUREMENT OR
ADMINISTRATIVE COSTS. WHILE IT IS IMPORTANT THAT GOVERNMENT PURCHASES
BE MADE AT THE LOWEST PRICE, THIS DOES NOT REQUIRE AN AWARD TO A * * *
SUPPLIER SOLELY BECAUSE HE SUBMITS THE LOWEST BID OR OFFER. A
PROSPECTIVE CONTRACTOR MUST DEMONSTRATE AFFIRMATIVELY HIS
RESPONSIBILITY, INCLUDING, WHEN NECESSARY, THAT OF HIS PROPOSED
SUBCONTRACTORS. THE CONTRACTING OFFICER SHALL MAKE A DETERMINATION OF
NONRESPONSIBILITY IF, AFTER COMPLIANCE WITH 1-905 AND 1-906, THE
INFORMATION THUS OBTAINED DOES NOT INDICATE CLEARLY THAT THE PROSPECTIVE
CONTRACTOR IS RESPONSIBLE. RECENT UNSATISFACTORY PERFORMANCE, IN EITHER
QUALITY OR TIMELINESS OF DELIVERY, WHETHER OR NOT DEFAULT PROCEEDINGS
WERE INSTITUTED, IS AN EXAMPLE OF A PROBLEM WHICH THE CONTRACTING
OFFICER MUST CONSIDER AND RESOLVE AS TO ITS IMPACT ON THE CURRENT
PROCUREMENT PRIOR TO MAKING AN AFFIRMATIVE DETERMINATION OF
RESPONSIBILITY. DOUBT AS TO PRODUCTIVE CAPACITY OR FINANCIAL STRENGTH
WHICH CANNOT BE RESOLVED AFFIRMATIVELY SHALL REQUIRE A DETERMINATION OF
NONRESPONSIBILITY.'
THE UNDERLYING QUESTION IS WHETHER REPUBLIC WAS, IN FACT, A
RESPONSIBLE OFFEROR WHICH WAS QUALIFIED TO MEET THE TERMS AND CONDITIONS
OF THE SOLICITATION. INSOFAR AS YOUR CONTENTIONS ARE AT VARIANCE WITH
THE FACTS ADMINISTRATIVELY REPORTED, OUR OFFICE IS BOUND BY THE
WELL-SETTLED RULE THAT PROHIBITS ANY INTERFERENCE WITH ADMINISTRATIVE
DETERMINATIONS OF RESPONSIBILITY IN THE ABSENCE OF A CLEAR SHOWING OF
BAD FAITH OR LACK OF A REASONABLE BASIS THEREFOR. 37 COMP. GEN. 430;
43 ID. 298; ZEPHYR AIRCRAFT CORPORATION V UNITED STATES, 122 CT. CL.
523.
IN YOUR LETTER OF AUGUST 13, 1969, YOU STATE THAT THE POSITION OF
REPUBLIC HAS BEEN THAT THERE WAS ONLY ONE PREAWARD DCASD SURVEY TEAM AND
THAT THE FRANKFORD ARSENAL PERSONNEL WERE PART OF THE SURVEY TEAM. YOU
CONTEND THAT THERE IS ONLY ONE PREAWARD REPORT AND THAT ONE RECOMMENDED
THAT REPUBLIC BE AWARDED THE CONTRACT. ALTHOUGH YOU RECOGNIZE THAT ASPR
DOES NOT PROVIDE THAT THE CONTRACTING OFFICER MUST FOLLOW THE
RECOMMENDATIONS OF THE DCASD PREAWARD SURVEY TEAM REPORT, YOU CONTEND
THAT THE CONTRACTING OFFICER'S FAILURE TO FOLLOW SUCH RECOMMENDATIONS
DOES EXPOSE HIM TO A CHARGE OF ABUSE OF DISCRETION. FURTHER, YOU STATE
THAT THIS FACT ALONE IS NOT CONTROLLING BUT WHEN THE WHOLE COMPOSITE
PICTURE IS PUT INTO PLACE, THERE COMES CLEARLY INTO FOCUS AN ARBITRARY
AND CAPRICIOUS ACTION ON THE PART OF THE CONTRACTING OFFICER.
IN THE INSTANT MATTER, ARRANGEMENTS WERE MADE TO HAVE A JOINT DCASD,
GARDEN CITY/FRANKFORD ARSENAL PREAWARD SURVEY WHICH WAS CONDUCTED AT
REPUBLIC'S FACILITY ON JANUARY 6 AND 7, 1969. WE ARE ADVISED THAT IN
VIEW OF THE EXTREME COMPLEXITY OF THE END ITEM (RADAR SET, AN/VPS-2) AND
THE CRITICAL DELIVERY REQUIREMENTS, AS WELL AS THE INCORPORATION OF A
RELATIVELY NEW ENGINEERING CONCEPT, PPE, IT WAS DECIDED AT THE OUTSET
THAT TOP LEVEL TECHNICAL PERSONNEL FROM FRANKFORD ARSENAL WOULD BE
PROVIDED TO AUGUMENT THE VARIOUS SURVEY TEAMS. WE ARE ADVISED THAT
FRANKFORD ARSENAL HAD INTIMATE KNOWLEDGE OF THE RADAR SET AS A RESULT OF
THEIR INVOLVEMENT IN THE RESEARCH AND DEVELOPMENT AS WELL AS PAST
NONCOMPETITIVE PRODUCTION CONTRACTS. THESE SAME EXPERTS SERVED AS
MEMBERS OF ALL THE TEAMS THAT CONDUCTED THE PREAWARD SURVEYS UNDER THIS
PROCUREMENT AND WE ARE ADVISED THAT THEIR PARTICIPATION WAS ESSENTIAL TO
ASSURE CONSISTENCY, DEPTH, AND QUALITY OF THE TECHNICAL REVIEW OF ALL
THE FIRMS SURVEYED. ASPR APPENDIX K-203.1 (B) STATES THAT THE
REPRESENTATIVES OF THE PURCHASING OFFICE SHALL PARTICIPATE IN THE
PREAWARD SURVEYS AS DESIRED BY THE PURCHASING OFFICE AND THE RECORD
BEFORE US INDICATES THAT THE PURCHASING OFFICE REQUESTED DCASD TO
INCLUDE THEIR REPRESENTATIVES IN THE PREAWARD SURVEY EFFORTS.
THE RECORD SHOWS THAT ALTHOUGH REPUBLIC RECEIVED A FAVORABLE AWARD
RECOMMENDATION FROM THE DCASD PREAWARD SURVEY REVIEW BOARD, THE
RECOMMENDATION WAS MADE NOTWITHSTANDING NEGATIVE FINDINGS EXPRESSED BY
THE FRANKFORD ARSENAL MEMBERS OF THE PREAWARD SURVEY TEAM. THE
CONTRACTING OFFICER STATES THAT HE REVIEWED THE SURVEY REPORT AND
OBTAINED COMMENTS FROM THE FRANKFORD ARSENAL TECHNICAL PARTICIPANTS.
AFTER PERSONALLY REVIEWING THE CASE, THE CONTRACTING OFFICER STATES THAT
HE DETERMINED REPUBLIC TO BE NONRESPONSIBLE SINCE REPUBLIC WAS
CONSIDERED TO BE TECHNICALLY DEFICIENT IN AREAS DEEMED ESSENTIAL TO
SUCCESSFUL AND TIMELY PERFORMANCE.
WHILE THE PREAWARD SURVEY CONDUCTED BY THE DCASD WAS FAVORABLE TO
REPUBLIC, THE CONTRACTING OFFICER WAS UNDER NO OBLIGATION TO ACCEPT THE
FINDINGS OF THE PREAWARD SURVEY TEAM AS CONCLUSIVE SINCE HE HAD OTHER
COMPETENT INFORMATION BEARING ADVERSELY ON REPUBLIC'S RESPONSIBILITY.
THERE IS NO REGULATORY REQUIREMENT THAT AN AWARD BE MADE TO A BIDDER
SOLELY BECAUSE OF A FAVORABLE PREAWARD SURVEY. SEE B-164187, OCTOBER
25, 1968; CF. ASPR 1-905.4 (A).
IN DETERMINING THE VALIDITY OF THE CONTRACTING OFFICER'S FINDING THAT
REPUBLIC WAS NOT A RESPONSIBLE OFFEROR, WE MUST LOOK TO THE INFORMATION
AND DATA AVAILABLE TO AND RELIED UPON BY HIM. THE CONTRACTING OFFICER
EXECUTED A WRITTEN DETERMINATION OF REPUBLIC'S NONRESPONSIBILITY ON
FEBRUARY 17, 1969, WHICH STATES AS FOLLOWS:
"1. I HEREBY FIND THAT:
"A. PRE-AWARD SURVEY NUMBER DGPA-68-12-126 DATED 13 FEBRUARY 1969
WAS CONDUCTED BY DCASD-GARDEN CITY, NEW YORK, ASSISTED BY FRANKFORD
ARSENAL TECHNICAL REPRESENTATIVES.
"B. THE FRANKFORD ARSENAL PARTICIPANTS SUBMITTED A REPORT ON THEIR
FINDINGS TO DCASD-GARDEN CITY. THE REPORT DISCUSSED AREAS IN WHICH THE
CONTRACTOR WAS FOUND TO BE TECHNICALLY DEFICIENT AND RECOMMENDED NO
AWARD.
"C. NOTWITHSTANDING THE NEGATIVE REPORT OF THE FRANKFORD ARSENAL
TECHNICAL PERSONNEL, THE PREAWARD SURVEY REVIEW BOARD AT DCASD-GARDEN
CITY RECOMMENDED THE CONTRACTOR BE GRANTED COMPLETE AWARD.
"D. BY MY REQUEST, THE FRANKFORD ARSENAL SENIOR INDUSTRIAL
SPECIALIST, THE PROJECT ENGINEER AND THE ENGINEERING TECHNICIAN WHO
PARTICIPATED AS TECHNICAL ADVISORS ON THE PRE-AWARD SURVEY REVIEWED THE
REPORT SUBMITTED BY DCASD-GARDEN CITY. RESPONSE WAS FURNISHED BY DF
DATED 17 FEBRUARY 1969, WHEREBY THE NEGATIVE FINDING PREVIOUSLY
SUBMITTED TO DCASD-GARDEN CITY WAS AFFIRMED.
"2. I HAVE REVIEWED THE DCASD-GARDEN CITY PRE-AWARD SURVEY REPORT,
OF WHICH THE FRANKFORD ARSENAL TECHNICAL REPORT FORMS A PART, AND THE
FRANKFORD ARSENAL TECHNICAL REVIEW OF THE DCASD-GARDEN CITY REPORT. AS
A RESULT OF MY REVIEW, I HEREBY DETERMINE THAT THE REQUIREMENTS OF ASPR
1-903.1 AND 1-903.2 HAVE NOT BEEN MET, THEREFORE, REPUBLIC ELECTRONICS
CORP., A SMALL BUSINESS CINCERN, IS NON-RESPONSIBLE FOR THE INSTANT
PROCUREMENT. AN AFFIRMATIVE DETERMINATION CANNOT BE MADE.'
IT WAS THE OPINION OF THE FRANKFORD ARSENAL TEAM THAT IN ORDER TO
PROPERLY COORDINATE PPE AND HARDWARE DELIVERY REQUIREMENTS AS SPECIFIED
IN THE RFP, IT WAS NECESSARY THAT A POTENTIAL MANUFACTURER NOT ONLY BE
FAMILIAR WITH VARIOUS ELECTRONIC PRODUCTION TECHNIQUES BUT ALSO BE
FLUENTLY VERSED IN THE FIELD OF THE CURRENT STATE-OF-THE-ART RELATING TO
COHERENT X-BAND, PULSE, DOPPLER RADARS. WITHOUT THIS UP-TO-DATE RADAR
KNOWLEDGE, FROM A TECHNICAL STANDPOINT, THE PROPER DIRECTION AND
ADHESION FOR THE NECESSARY PRELIMINARY PPE EFFORT COULD NOT BE
ACCOMPLISHED. WE ARE ADVISED THAT TO START A PPE PROGRAM, AS SPECIFIED
BY THE RFP, THE POTENTIAL CONTRACTOR SHOULD HAVE ON BOARD A SUFFICIENT
TECHNICAL STAFF TO PROVIDE THE INITIAL TECHNICAL PROGRAM BASE LINE
IMMEDIATELY UPON CONTRACT AWARD. IT WAS FOR THIS REASON THAT THE RFP
INCLUDED, ON PAGE 39, VARIOUS TECHNICAL AND PRODUCTION CRITIQUE ITEMS AS
TO WHICH ALL OFFERORS WERE ALERTED TO THE FACT THAT SUCH ITEMS WOULD BE
REVIEWED IN DETAIL BY THE SURVEY TEAM.
OUR OFFICE HAS REVIEWED THE TRIP REPORT OF THE FRANKFORD ARSENAL
MEMBERS OF THE SURVEY TEAM. THIS REPORT STATES IN DETAIL VARIOUS AREAS
IN WHICH REPUBLIC WAS FOUND TO BE TECHNICALLY DEFICIENT.
THE TRIP REPORT CONCLUDES BY STATING THAT REPUBLIC DID NOT UNDERSTAN
THE ENGINEERING REQUIREMENTS FOR PPE; DID NOT DEMONSTRATE THE REQUIRED
TECHNICAL CAPABILITY; PRODUCTION CAPABILITY; OR THE PURCHASING
CAPABILITY DEMANDED BY THE RFP. WE HAVE ALSO REVIEWED THE FINDINGS OF
THE DCASD REPRESENTATIVES AS WELL AS THE PREAWARD SURVEY REPORT AND WE
NOTE THAT THERE ARE DIFFERENCES OF OPINION CONCERNING REPUBLIC'S
RESPONSIBILITY. FOR EXAMPLE, THE RECORD INDICATES THAT AT THE TIME OF
THE PREAWARD SURVEY, AN ATTEMPT WAS MADE TO QUESTION REPUBLIC CONCERNING
THE ENGINEERING NOTE CHANGES TO THE TECHNICAL DATA PACKAGE. REPUBLIC
INDICATED THAT THEY WERE NOT PREPARED TO DISCUSS THESE CHANGES IN DETAIL
AT THAT TIME. HOWEVER, IT IS REPORTED THAT REPUBLIC STATED THAT NOTE
CHANGES WERE CONSIDERED WHEN THEIR PROPOSAL WAS SUBMITTED BUT FELT IT
WOULD NOT SIGNIFICANTLY ALTER THEIR ESTIMATE AND THAT THERE WAS ENOUGH
CUSHION IN THE COST ESTIMATE TO COVER THESE CHANGES. THE DCASD
REPRESENTATIVE ACCEPTED THE REPUBLIC STATEMENT THAT THERE WAS ENOUGH
"CUSHION" TO COVER THE ENGINEERING NOTE CHANGES, WHEREAS THE FRANKFORD
ARSENAL CONSIDERED THIS OMISSION BY REPUBLIC SIGNIFICANT SINCE IT
REPRESENTED AN INADEQUATE ANALYSIS OF THE TECHNICAL DATA PACKAGE AND
AFFECTS THE BILL OF MATERIAL AS WELL AS THE ENGINEERING TASKS TO BE
ACCOMPLISHED UNDER THE PPE EFFORT. WE ARE ADVISED THAT THE COST IMPACT
OF ONLY FOUR OF THE MATERIAL ITEMS COVERED BY THE ENGINEERING NOTES
EXCEEDS $250,000.
ANY DETERMINATION AS TO REPUBLIC'S RESPONSIBILITY IS NECESSARILY A
QUESTION OF FACT. IT IS THE RESPONSIBILITY OF OUR OFFICE TO INSURE THAT
GOVERNMENT PROCUREMENTS ARE MADE IN ACCORDANCE WITH APPLICABLE LAW, AND
THIS NECESSARILY INVOLVES REVIEW OF THE ADMINISTRATIVE DISCRETION TO THE
EXTENT NECESSARY TO SEE THAT SUCH DISCRETION HAS BEEN EXERCISED WITHIN
PROPER LIMITS. IT IS OUR DUTY TO DETERMINE FROM ALL THE FACTS AND
CIRCUMSTANCES SURROUNDING THE PRESENT CONTROVERSY WHETHER THE
CONTRACTING OFFICER'S DETERMINATION THAT REPUBLIC IS NOT RESPONSIBLE FOR
PURPOSES OF THIS PROCUREMENT IS REASONABLY SUPPORTED BY THE RECORD. AS
INDICATED ABOVE, WE HAVE ADOPTED THE GENERAL RULE THAT WE WILL NOT
SUBSTITUTE OUR JUDGMENT FOR THAT OF THE CONTRACTING OFFICER, UNLESS IT
IS SHOWN BY CONVINCING EVIDENCE THAT THE DETERMINATION WAS ARBITRARY, OR
NOT BASED ON SUBSTANTIAL EVIDENCE. 43 COMP. GEN. 257, 258; 38 ID. 778.
IN YOUR LETTER OF AUGUST 13, 1969, YOU CONTEND THAT THE CONTRACTING
OFFICER DID NOT REVIEW ALL OF THE INFORMATION AVAILABLE PRIOR TO HIS
DECISION THAT REPUBLIC WAS NOT RESPONSIBLE. THIS CONTENTION APPEARS TO
BE BASED ON THE FACT THAT THE CONTRACTING OFFICER DID NOT SEE REPUBLIC'S
,FACILITY AND CAPABILITY REVIEW.' THE CONTRACTING OFFICER ADVISES THAT
ALTHOUGH THE "FACILITY AND CAPABILITY REVIEW" WAS FORWARDED TO FRANKFORD
ARSENAL ALONG WITH THE PREAWARD SURVEY SUCH REVIEW WAS NOT EXAMINED BY
HIM. HOWEVER, THE PREAWARD SURVEY, WHICH WAS CAREFULLY REVIEWED BY THE
CONTRACTING OFFICER, COVERED ALL OF THE INPUT DOCUMENTATION AND THE
FINDINGS IN THE PREAWARD REPORT TOOK INTO CONSIDERATION THE SUPPORTING
DOCUMENTATIONS, INCLUDING THE "FACILITY AND CAPABILITY REVIEW.'
THE CONTRACTING OFFICER STATES THAT HE THOROUGHLY REVIEWED THE
PREAWARD SURVEY REPORT INCLUDING THAT PORTION PREPARED BY THE FRANKFORD
ARSENAL PARTICIPANTS. AFTER REVIEW AND BECAUSE OF THE CONFLICTING
RECOMMENDATIONS, HE DIRECTED THAT A COMPLETE FURTHER REVIEW BE MADE BY
THE FRANKFORD ARSENAL PARTICIPANTS OF REPUBLIC'S CAPABILITIES. HOWEVER,
THAT SUBSEQUENT REVIEW DID NOT REVEAL ANY ADDITIONAL SIGNIFICANT
INFORMATION NOT ALREADY CONSIDERED BY THEM IN THEIR INITIAL REPORT. THE
REPUBLIC "FACILITY AND CAPABILITY REVIEW," WHICH WAS GIVEN TO THE
PREAWARD SURVEY TEAM, WAS IN THE POSSESSION OF THE FRANKFORD ARSENAL
PARTICIPANTS DURING THEIR INITIAL EVALUATION AND THEIR SUBSEQUENT
REVIEW. WE ARE ADVISED THAT THIS REVIEW WAS USED BY THE PREAWARD SURVEY
TEAM IN CONDUCTING ITS INVESTIGATION OF THE CAPABILITY OF REPUBLIC, AND
THAT EVEN THOUGH SUCH REVIEW MAKES OUT A GOOD CASE FOR REPUBLIC'S
RESPONSIBILITY, IT WAS MEASURED AGAINST THE INFORMATION AND RESULTS
OBTAINED IN THE ON-THE-SPOT PREAWARD SURVEY.
THE FRANKFORD ARSENAL PERSONNEL MADE A FACT-FINDING INVESTIGATION,
AND, IN SPITE OF THE REPUBLIC REVIEW, FOUND IT WANTING IN CAPABILITY.
FOR EXAMPLE, IN SECTION "O" OF SUCH REVIEW A STATEMENT IS MADE
CONCERNING THE EXPERIENCE OF REPUBLIC'S ENGINEERING PERSONNEL. IT IS
REPORTED THAT FRANKFORD ARSENAL PERSONNEL WAS AWARE OF THAT SECTION AS
EVIDENCED BY THE FOLLOWING STATEMENT FURNISHED BY THE PROCUREMENT
AGENCY:
"THE CONTRACTOR'S EXPERIENCE IN -X- BAND RADAR AND DIGITAL FIELDS WAS
CONSIDERED TO BE BELOW THAT REQUIRED TO SATISFACTORILY COMPLY WITH THE
CONDITIONS OF THE RFQ. THE COMPANY'S PRIMARY EXPERIENCE WAS IN LOW
FREQUENCY TACTICAL AIR COMMUNICATION AND NAVIGATION EQUIPMENT. WHAT
EXPERIENCE THE COMPANY PERSONNEL HAD IN X BAND RADAR WAS ACHIEVED AT
OTHER COMMERCIAL FACILITIES. FURTHER QUESTIONING REVEALED THAT THOSE
PEOPLE IN THE COMPANY WHO HAD HAD THIS PAST DIGITAL AND RADAR EXPERIENCE
DID NOT PARTICIPATE IN THE PREPARATION ON THE CONTRACTOR'S BID.'
AGAIN, IT IS OBVIOUS THAT SECTIONS "K" TO "N" OF THE REPUBLIC REVIEW
WERE USED BY THE FRANKFORD ARSENAL PARTICIPANTS IN CONDUCTING THEIR PART
OF THE SURVEY. ONLY BY SUCH ACTION COULD THEY HAVE ARRIVED AT THE
FOLLOWING CONCLUSIONS REPORTED TO US: "/1) THE CONTRACTOR STATED THAT
HIS PLANNING ENVISIONED APPROXIMATELY 5-1/2 MAN YEARS OF EFFORT. THIS
WAS TO COVER THE PRE-PRODUCTION EVALUATION, SUPPORT MANUFACTURING
PURCHASING AND TESTING, DESIGN AND FABRICATE ALL THE TEST EQUIPMENT AND
MANAGE THE OVERALL PROGRAM. IN THIS LIGHT EACH OF THE ABOVE WERE
THROUGHLY DISCUSSED TO EVALUATE THE CONTRACTOR'S COMPREHENSION OF THE
JOB TO BE DONE.''2) PRE-PRODUCTION EVALUATION: THE CONTRACTOR GROSSLY
UNDERESTIMATED THE JOB TO BE DONE IN THIS AREA AS EVIDENCED BY THE FACT
THAT HE STATED THAT 300 HOURS OF ELECTRICAL ENGINEERING AND 1900 HOURS
OF MECHANICAL ENGINEERING TIME WOULD BE UTILIZED IN THIS EFFORT.
ASSIGNMENT OF THESE FEW HOURS IS NOT ONLY AN UNDERESTIMATE OF THE JOB TO
BE DONE AS REQUIRED BY THE RFQ BUT, ALSO EXHIBIT A LACK OF UNDERSTANDING
OF THE REQUIREMENTS FOR THE PPE EFFORT. THE RFQ PARTICULARLY SPECIFIES
HOW THE TECHNICAL DATA PACKAGE MUST BE COMPLETELY ANALYZED AND REVIEWED,
NOT ONLY INITIALLY, BUT ALSO DURING THE ENTIRE TENURE OF THE CONTRACT.
TO STATE, FOR EXAMPLE, THAT 300 ELECTRICAL ENGINEERING HOURS WAS
ALLOCATED FOR THE REVIEW OF THE RADAR SET IS INDICATIVE OF THE FACT THAT
THE CONTRACTOR DID NOT HAVE AN UNDERSTANDING OF THE TECHNICAL FINESSE
REQUIRED TO PERFORM TO THE PPE REQUIREMENT.''3) ENG. SUPPORT: THE MAJOR
AREAS DISCUSSED WERE TEST AND PURCHASING. PURCHASING WILL BE COVERED IN
A SUBSEQUENT PARAGRAPH OF THIS REPORT. LENGTHY DISCUSSIONS FOLLOWED IN
AN ATTEMPT TO EVALUATE THE CONTRACTOR'S UNDERSTANDING OF THE TECHNICAL
REQUIREMENTS FOR PRODUCTION TESTING OF 25, AN/VPS2 UNITS PER MONTH. HE
STATED THAT HE HAD PROVIDED FOR 10 SPECIFIC TEST STATIONS FOR ALL UNIT
AND SUB-UNIT TESTS AND OTHER STATIONS FOR ANTENNA TEST, SERVO TEST AND
SYSTEM TEST. DETAILED DISCUSSIONS RELATIVE TO THE SPECIFICS OF THE
FINAL TEST, TRANSMITTER RECEIVER (UNIT NO. 2) AND THE FINE PRINTED
CIRCUIT BOARD (UNIT 4A22) SPECIFICATIONS FOUND THAT THE CONTRACTOR HAD
NOT UNDERSTOOD THE REAL TECHNIQUES REQUIRED TO ADEQUATELY TEST THESE
UNITS IN THE REQUIRED PRODUCTION QUANTITIES. IT BECAME EVIDENT THAT HE
MERELY LISTED THE STANDARD TEST EQUIPMENT CALLED OUT IN THE GOVERNMENT
SPECIFICATIONS AND HAD NO IDEAS OF HOW THIS EQUIPMENT WOULD BE EMPLOYED
AT HIS -SPECIFIC- STATIONS. THE PERSONNEL AT THE CONFERENCE EMPLOYED
DELAYING DISCUSSIONS TO ALLOW OTHER ENGINEERS TO READ THE SPECS, THEN
THEY IN TURN WOULD DISCUSS THE REQUIREMENTS IN GENERAL TERMS. IN THE
CASE OF THE FINAL SYSTEM TESTER AFTER TWO ATTEMPTS TO DEMONSTRATE THEIR
KNOWLEDGE, THE CONTRACTOR'S SPOKESMAN HAD TO HUDDLE WITH MR. SELBIGER
WHO ATTENDED THESE MEETINGS AS A CONSULTANT. (HE DID NOT PARTICIPATE IN
THE BID PREPARATION). IN GENERAL, THE CONTRACTOR COULD ONLY COME UP
WITH TECHNICAL ANSWERS AFTER THE SURVEY TEAM POINTED OUT THE MISTAKES IN
THEIR OFFERED APPROACHES. AS EVIDENCE OF THE CONTRACTOR'S LACK OF
KNOWLEDGE HIS ORIGINAL SYSTEM TEST APPROACH WHEN QUESTIONED WAS OFFERED
AS A -BLACK BOX- WHICH COULD NOT BE EXPLAINED IN ANY DETAIL DURING THE
INITIAL QUESTIONING PERIOD. WHEN PERMITTED TO REVIEW THE FINAL RADAR
SYSTEM SPECIFICATION, HE INDICATED THAT THIS -BLACK BOX- WOULD HAVE A
BUILT IN DELAY LINE. WHEN ASKED IF SUCH A DELAY LINE EXISTED FOR A
4,000 METER TARGET, HE COULD NOT OFFER AN EXAMPLE. THE DISCUSSION THEN
BROUGHT IN THE FACT THAT AN EXISTING BRIDGE COULD BE USED FOR THE FAR
DISTANCE TARGET. WHEN FURTHER QUESTIONED ABOUT THIS BRIDGE, IT WAS
STATED THAT THE BRIDGE WAS APPROXIMATELY 10 MILES AWAY, AND THE SURVEY
TEAM POINTED OUT THAT THE REFLECTIVE SURFACE OF THE BRIDGE COULD NOT BE
PREDETERMINED FOR THE REQUIREMENTS OF THE RADAR SYSTEM TESTER. THE
CONTRACTOR FINALLY CONCEDED THAT HE WOULD HAVE TO HAVE A TARGET LOCATED
AT THE REQUIRED DISTANCE AWAY FROM THE RADAR BUT COULD NOT GIVE ANY
DETAILS AS TO HOW THIS WOULD BE COMPLISHED.''4) IN THE CASE OF PRINTED
CIRCUIT BOARD AND RADAR UNIT TEST STATIONS, CONTRACTOR STATEMENTS IN
THESE AREAS INDICATED THAT HE WOULD FOLLOW THE SPECIFICATIONS
COMPLETELY. WHEN IT WAS STATED BY THE SURVEY TEAM THAT THE TEST
SPECIFICATIONS WERE TOTALLY LACKING IN SPECIFIC AREAS RELATED TO SPECIAL
TEST EQUIPMENT, THE CONTRACTOR INDICATED THAT HE WOULD DESIGN AND
FABRICATE WHAT NECESSARY EQUIPMENT WOULD BE REQUIRED. THE CONTRACTOR'S
ALLOCATION OF ENGINEERING HOURS TO DESIGN THE REQUIRED SPECIFIC TEST
EQUIPMENT WAS GROSSLY UNDERESTIMATED FOR THIS TASK.''5) THE CONTRACTOR'S
EXPERIENCE IN -X- BAND RADAR AND DIGITAL FIELDS WAS CONSIDERED TO BE
BELOW THAT REQUIRED TO SATISFACTORILY COMPLY WITH THE CONDITIONS OF THE
RFQ. THE COMPANY'S PRIMARY EXPERIENCE WAS IN LOW FREQUENCY TACTICAL AIR
COMMUNICATION AND NAVIGATION EQUIPMENT. WHAT EXPERIENCE THE COMPANY
PERSONNEL HAD IN X BAND RADAR WAS ACHIEVED AT OTHER COMMERCIAL
FACILITIES. FURTHER QUESTIONING REVEALED THAT THOSE PEOPLE IN THE
COMPANY WHO HAD HAD THIS PAST DIGITAL AND RADAR EXPERIENCE DID NOT
PARTICIPATE IN THE PREPARATION ON THE CONTRACTOR'S BID.''6) THE COMPANY
HAD SCREEN ROOMS NECESSARY TO PERFORM VARIOUS RFI TESTS. HOWEVER, THEY
MISSED THE FACT THAT THE RFQ INDICATED THAT BREEZE CABLES FOR RFI
SHIELDING OF THE RADAR WERE SPECIFIED. THEIR COMPANY'S REPRESENTATIVES
ATTENDED THE BIDDER'S CONFERENCE WHEN THE ENGINEERING CHANGE ASSOCIATED
WITH THE BREEZE CABLES WAS DISCUSSED. EVEN WITH THE INFORMATION
AVAILABLE TO THE COMPANY, THEIR ORIGINAL QUOTE DID NOT ACCOMMODATE THE
REQUIREMENT FOR RFI SHIELDED CABLES (BREEZE). ADDITIONALLY, IN THE
FABRICATION OF THE MOTHER BOARD FOR THE RANGE COMPUTER ASSEMBLY, THE
CONTRACTOR HAD CONTEMPLATED HAND WIRING THE 1200 WIRES THAT WERE
SPECIFIED IN THE UNIT. TO CONSIDER HAND WIRING IN LIEU OF MACHINE
PROGRAM WIRING ILLUSTRATED ANOTHER LACK OF UNDERSTANDING OF THE
REQUIREMENTS FOR FAST DIGITAL SWITCHING ESPECIALLY IN THE AREAS OF
INDUCTIVE AND CAPACITIVE INTERFACE AFFECTS.'
WE DO NOT AGREE WITH YOUR CONTENTION THAT THE CONTRACTING OFFICER HAS
NOW CHANGED HIS POSITION WITH RESPECT TO THE AMOUNT OF PLANT SPACE THAT
REPUBLIC HAS AT ITS HUNTINGTON PLANT. THE CONTRACTING OFFICER'S
POSITION IS AND HAS REMAINED THE SAME. IT IS STIPULATED THAT THE
HUNTINGTON PLANT OCCUPIES AN AREA OF 34,000 SQUARE FEET. HOWEVER, THE
FRANKFORD ARSENAL PARTICIPANTS APPROXIMATED THAT ONLY 24,000 SQUARE FEET
OF THE TOTAL SPACE COULD BE UTILIZED FOR THIS PROCUREMENT. WE NOTE THAT
THE DCASD PREAWARD SURVEY REPORT INDICATES THAT ONLY 1,000 SQUARE FEET
OF MANUFACTURING SPACE AND 1,000 SQUARE FEET OF STORAGE SPACE WERE FOUND
TO BE AVAILABLE FOR THIS PROCUREMENT. WE HAVE BEEN ADVISED THAT
ELECTROMAGNETIC TECHNOLOGY CORPORATION ALLOCATED 51,000 SQUARE FEET
SOLELY FOR MANUFACTURING, UNLIKE REPUBLIC'S 34,000 SQUARE FEET WHICH
INCLUDES AREAS FOR ENGINEERING, CONTRACT ADMINISTRATION, ACCOUNTING,
PERSONNEL, PURCHASING, EXECUTIVE ADMINISTRATION, ETC.
WITH RESPECT TO REPUBLIC'S ESTIMATES OF THE NUMBER OF MAN-HOURS
ALLOCATED TO VARIOUS ENGINEERING AND OPERATION CATEGORIES, WE NOTE THAT
THERE ARE NO DIFFERENCES BETWEEN THE HOURS WHICH YOU REFER TO AND THOSE
LISTED IN THE ORIGINAL FRANKFORD ARSENAL TRIP REPORT. THE 5-1/2
MAN-YEARS OF TOTAL ESTIMATED ENGINEERING EFFORT WAS FURNISHED BY
REPUBLIC DURING THE SURVEY. THE BREAKDOWN OF ENGINEERING AND OPERATIONS
TIME CONTAINED IN THE FRANKFORD ARSENAL TRIP REPORT IS SET OUT BELOW:
A. ENGINEERING:
(1) ENG. E. E. 5,360 M/HRS. 2.6 M/YRS.
(2) ENG. TECH. 3,440 M/HRS. 1.7 M/YRS.
(3) ENG. MECH. 1,520 M/HRS. .76 M/YRS.
(4) RELIABILITY 900 M/HRS. .45 M/YRS.
--------------
TOTAL: 11,220 M/HRS.
B. OPERATIONS:
(1) PRODUCTION 196,080 M/HRS. 98.0 M/YRS.
(2) METHODS 900 M/HRS. .45 M/YRS.
(3) INSPECTION 16,360 M/HRS. 8.2 M/YRS.
(4) TEST 26,240 M/HRS. 13.1 M/YRS.
(5) DES. AND DRAFTING 5,200 M/HRS. 2.6 M/YRS.
--------------
TOTAL: 244,780 M/HRS.
IT IS REPORTED THAT REPUBLIC SUBMITTED A DD FORM 633 "CONTRACT
PRICING PROPOSAL" WHICH INDICATED ENGINEERING LABOR COST IN THE TOTAL
AMOUNT OF $51,925. BASED ON THE 5-1/2 MAN-YEARS OF EFFORT (11,220
MAN-HOURS), THE AVERAGE ENGINEERING HOURLY RATE WOULD BE LESS THAN $5.
HOWEVER, REPUBLIC CONTENDS THAT 12.3 MAN-YEARS OF EFFORT WERE INTENDED
RATHER THAN 5-1/2 MAN-YEARS OF ENGINEERING EFFORT. REPUBLIC, DURING THE
COURSE OF THE SURVEY, NEVER SUBMITTED A 12.3 MAN-YEARS' FIGURE RELATING
TO ENGINEERING EFFORT. WE ARE ADVISED THAT IF THIS FIGURE HAD BEEN
SUBMITTED, IT WOULD HAVE BEEN RELATED TO THE $51,925 AMOUNT SHOWN ON THE
DD FORM 633 AND, AS A RESULT, THE 12.3 MAN-YEARS WOULD HAVE INDICATED AN
AVERAGE HOURLY RATE FOR ENGINEERING LABOR OF APPROXIMATELY $2, A RATE
WHICH IS REPORTED TO BE UNREALISTIC FOR THIS LABOR CATEGORY. THE RECORD
INDICATES THAT OUT OF THE TOTAL HOURS FOR THE ENTIRE EFFORT, REPUBLIC
ALLOCATED ONLY 300 ELECTRICAL AND 1,900 MECHANICAL ENGINEERING HOURS TO
THE PPE EFFORT. REPUBLIC NOW CLAIMS THAT ALL OF THE ENGINEERING HOURS
LISTED WERE TO BE USED IN THE PPE PHASE OF THE CONTRACT, WHICH WOULD
LEAVE NO ENGINEERING HOURS FOR THE PRODUCTION PHASE OF THE CONTRACT. WE
ARE ADVISED THAT IF THIS POSITION WAS ESTABLISHED AT THE TIME OF THE
SURVEY, THE SURVEY TEAM WOULD HAVE SERIOUSLY QUESTIONED THE FAILURE TO
ALLOCATE ANY ENGINEERING HOURS TO THE PRODUCTION PHASE. SINCE REPUBLIC
STATED THAT 300 ENGINEERING HOURS WERE ALLOCATED TO THE PPE PHASE, THIS
IS THE FIGURE THAT WAS USED BY THE SURVEY TEAM IN ITS EVALUATION. WITH
RESPECT TO THE 1,900 HOURS OF MECHNICAL ENGINEERING VERSUS THE 1,520
LISTED IN THE CONTRACTING OFFICER'S COMMENTS, THE TEAM WAS ORALLY
INFORMED BY REPUBLIC DURING THE SURVEY THAT THE 1,900 HOURS WOULD BE
USED AND THE TEAM ACCEPTED THE 1,900 FIGURE SINCE THE DIFFERENCE OF 380
HOURS WAS DEEMED INSIGNIFICANT.
THE CONTRACTING OFFICER STATES THAT AFTER REVIEWING THE PREAWARD
SURVEY REPORT, HE DETERMINED REPUBLIC TO BE NONRESPONSIBLE IN VIEW OF
THEIR INABILITY TO POSITIVELY INDICATE COMPLETE UNDERSTANDING OF THE
TECHNICAL REQUIREMENTS AS REQUIRED BY ASPR. IN REACHING THIS DECISION,
THE CONTRACTING OFFICER UNDOUBTEDLY GAVE MORE WEIGHT TO THE NEGATIVE
FINDINGS OF THE FRANKFORD ARSENAL PARTICIPANTS. HOWEVER, WE CANNOT SAY
THAT THE CONTRACTING OFFICER ACTED ARBITRARILY OR FAILED TO BASE HIS
DECISION ON SUBSTANTIAL EVIDENCE. THE TECHNICAL PERSONNEL OF FRANKFORD
ARSENAL WHO TOOK PART IN THE PREAWARD SURVEY WERE INTIMATELY FAMILIAR
WITH THIS EXTREMELY COMPLEX ELECTRONIC MATERIAL AS THEY HAD BEEN
ACQUAINTED WITH THIS ITEM FROM RESEARCH AND DEVELOPMENT ON THROUGH
PRODUCTION BY A PRIOR PRODUCER. ALSO, IT IS A STANDARD POLICY TO SEND
OUT TECHNICAL PERSONNEL FROM FRANKFORD ARSENAL TO ASSIST ON PREAWARD
SURVEYS OF COMPLEX PROCUREMENTS AND THESE PERSONNEL HAVE PERFORMED IN
THIS CAPACITY ON MANY OCCASIONS. THERE IS NO PROVISION OF ASPR OR OTHER
AUTHORITY WHICH REQUIRES A CONTRACTING OFFICER TO ACCEPT THE
RECOMMENDATION OF A PREAWARD SURVEY TEAM AS AGAINST OTHER COMPETENT
TECHNICAL ADVICE TO THE CONTRARY. IN THIS CASE, THE CONTRACTING OFFICER
SAW FIT TO OVERRIDE THE DCASD RECOMMENDATION AND RELY UPON THE EXPERTS
HE HAD AT HIS DISPOSAL. THIS RELIANCE WAS PREDICATED ON THE FACT THAT
THESE TECHNICAL PERSONNEL HAD MUCH MORE EXPERIENCE, INTIMATE KNOWLEDGE
AND EXPERTISE WITH RESPECT TO THE END ITEM THAN THE DCASD PERSONNEL. IT
WAS ON THAT BASIS HE SAW FIT TO ACCEPT THEIR JUDGMENT IN LIEU OF THE
DCASD REPORT. SEE B-165084; B-165691, APRIL 11, 1969, 48 COMP. GEN.
-----.
IN YOUR LETTER OF JUNE 18, 1969, YOU STATE THAT TO DENY THAT REPUBLIC
WAS TREATED UNFAIRLY IS TO OVERLOOK THE GOVERNMENT PROCUREMENT SYSTEM
WHEREBY A SMALL BUSINESS HAS THE RIGHT TO APPLY FOR A CERTIFICATE OF
COMPETENCY FROM THE SMALL BUSINESS ADMINISTRATION (SBA) WHEN IT HAS BEEN
DETERMINED TO BE NONRESPONSIBLE. ASPR 1-705.4 PROVIDES THAT WHEN THE
BID OR PROPOSAL OF A SMALL BUSINESS CONCERN IS TO BE REJECTED SOLELY
BECAUSE THE CONTRACTING OFFICER HAS DETERMINED THAT THE CONCERN IS
NONRESPONSIBLE AS TO CAPACITY OR CREDIT, THE MATTER SHALL BE REFERRED TO
SBA AND AWARD SHALL NOT BE MADE UNTIL SBA RENDERS ITS DECISION OR UNTIL
15 WORKING DAYS HAVE ELAPSED, WHICHEVER IS EARLIER. HOWEVER, ASPR
1-705.4 (C) (IV) PROVIDES THAT REFERRAL NEED NOT BE MADE TO SBA IF THE
CONTRACTING OFFICER CERTIFIES IN WRITING THAT THE AWARD MUST BE MADE
WITHOUT DELAY, INCLUDES SUCH CERTIFICATE AND SUPPORTING DOCUMENTATION IN
THE CONTRACT FILE, AND PROMPTLY FURNISHES A COPY TO THE SBA
REPRESENTATIVE. YOU QUESTION WHETHER AN URGENT REQUIREMENT ACTUALLY
EXISTED.
THE FACTS OF RECORD INDICATE THAT ON FEBRUARY 14, 1969, THE
CONTRACTING OFFICER EXECUTED A CERTIFICATE OF URGENCY WHICH STATES, IN
PERTINENT PART, AS FOLLOWS:
"2. ALL LINE ITEM REQUIREMENTS BEAR PRIORITY -02-, IN SUPPORT OF SEA
WITH DELIVERIES, AS SPECIFIED IN THE SOLICITATION, SPANNING THE PERIOD
DECEMBER 1969 THROUGH MARCH 1971, BASED ON AWARD 20 FEBRUARY 1969. THE
SOLICITATION CLOSED 10 DECEMBER 1968 AND PRE-AWARD SURVEYS OF THE
POTENTIAL CONTRACTORS WERE COMPLETED 7 FEBRUARY 1969. SEVERAL
DETERMINATIONS OF NON-RESPONSIBILITY HAVE BEEN MADE INVOLVING SMALL
BUSINESS CONCERNS.
"3. BY MESSAGE NUMBER 00957 DATED 5 FEBRUARY 1969, THE OFFICE OF THE
ASSISTANT PROJECT MANAGER FOR THE VULCAN AIR DEFENSE SYSTEM
(AMSWE-VADS), U.S. ARMY WEAPONS COMMAND, ROCK ISLAND, ILLINOIS WAS
SOLICITED TO PROVIDE DATA RELATIVE TO PROGRAM IMPACT SHOULD SHIPPAGE OF
THE DELIVERY SCHEDULE OF THE SOLICITATION BE INCURRED. BY MESSAGE RI
3526 DATED 11 FEBRUARY 1969, AMSWE-VADS ADVISED THAT DELAY IN AWARD AND
CONSEQUENT SHIPPAGE IN DELIVERIES COULD NOT BE TOLERATED AND MANDATED
THAT DELIVERIES BE MET AS REQUIRED BY THE SOLICITATION IN ORDER TO
PROVIDE THE MINIMUM HARDWARE QUANTITIES NECESSARY TO MEET THE VULCAN
ACTIVATION AND DEPLOYMENT DATES AS DIRECTED BY DEPARTMENT OF THE ARMY.
"4. BASED ON THE FOREGOING, AND PURSUANT TO ASPR 1-705.4 (C) (IV), I
HEREBY CERTIFY THAT AWARD OF THE ABOVE MENTIONED REQUIREMENTS MUST BE
MADE WITHOUT THE DELAY INCIDENT TO REFERRAL OF A DETERMINATION OF
NONRESPONSIBILITY FOR A SMALL BUSINESS CONCERN TO THE SMALL BUSINESS
ADMINISTRATION FOR CERTIFICATE OF COMPETENCY CONSIDERATION.' BY LETTER
DATED FEBRUARY 20, 1969, THE CONTRACTING OFFICER NOTIFIED SBA OF HIS
URGENCY DETERMINATION.
WHILE THE URGENCY OF THE PROCUREMENT WAS REVALIDATED AS INDICATED
ABOVE, SUCH ACTION WAS TAKEN IN ACCORDANCE WITH ESTABLISHED PROCUREMENT
PROCEDURES. THE PURPOSE OF THE REVALIDATION WAS TO ASSURE THAT THE
ORIGINAL URGENCY REQUIREMENT PLACED ON THE PROCUREMENT AT ITS INCEPTION
STILL PERSISTED AT THE TIME THE CONTRACTING OFFICER EXECUTED HIS
CERTIFICATE OF URGENCY. ALTHOUGH YOU CONTEND THAT THE DEPARTMENT OF THE
ARMY HAS NOT OFFERED ANY PROOF THAT AN URGENT REQUIREMENT EXISTED, OUR
OFFICE HAS BEEN FURNISHED WITH DOCUMENTS FROM THE PROCURING AGENCY WHICH
ESTABLISH THE URGENCY OF THIS PROCUREMENT. WE FIND NO FACTUAL BASIS TO
QUESTION THE URGENCY DETERMINATION.
YOU CONTEND THAT THE CONTRACTING OFFICER DID NOT GIVE A SATISFACTORY
EXPLANATION AS TO WHY HE COULD NOT WAIT 10 TO 15 DAYS OR EVEN 21
CALENDAR DAYS FOR SBA TO EXERCISE ITS CERTIFICATE OF COMPETENCY
AUTHORITY IN VIEW OF THE FACT THAT THE RFP PROVIDED FOR A LEADTIME OF 12
MONTHS FOR DELIVERY OF THE INITIAL SAMPLE. THE EXPLANATION LIES IN ASPR
1-705.4 (C) WHICH PROVIDES IN PERTINENT PART AS FOLLOWS: "CONCURRENT
REFERRALS OF TWO OR MORE BIDS OR PROPOSALS, REJECTED BECAUSE OF LACK OF
CAPACITY OR CREDIT FOR A PROPOSED AWARD, SHALL NOT BE MADE TO SBA BY THE
CONTRACTING OFFICER.' UNDER THIS REQUIREMENT, REFERRAL OF THE MATTER OF
REPUBLIC'S NONRESPONSIBILITY TO SBA WOULD HAVE HAD TO FOLLOW TWO OTHER
LOWER PROPOSERS WHO WERE ALSO SMALL BUSINESS FIRMS. THESE SUCCESSIVE
SUBMITTALS TO SBA WOULD HAVE RESULTED IN DELAYS CONSIDERABLY IN EXCESS
OF 21 CALENDAR DAYS.
ALTHOUGH YOU CONTEND THAT THE GOVERNMENT WOULD HAVE SAVED $749,532 BY
AWARDING THE CONTRACT TO REPUBLIC, WE DRAW YOUR ATTENTION TO ASPR 1-902
WHICH PROVIDES IN PERTINENT PART AS FOLLOWS:
"* * * THE CONTRACTING OFFICER SHALL MAKE A DETERMINATION OF
NONRESPONSIBILITY IF, AFTER COMPLIANCE WITH 1-905 AND 1-906, THE
INFORMATION THUS OBTAINED DOES NOT INDICATE CLEARLY THAT THE PROSPECTIVE
CONTRACTOR IS RESPONSIBLE. * * * DOUBT AS TO PRODUCTIVE CAPACITY OR
FINANCIAL STRENGTH WHICH CANNOT BE RESOLVED AFFIRMATIVELY SHALL REQUIRE
A DETERMINATION OF NONRESPONSIBILITY.'
UNDER THIS REGULATION, THE BURDEN IS ON THE PROSPECTIVE CONTRACTOR TO
ESTABLISH AFFIRMATIVELY ITS RESPONSIBILITY AND, IF NECESSARY, THAT OF
ITS PROPOSED SUBCONTRACTORS, AND THE CONTRACTING OFFICER, IN THE EVENT
OF DOUBT CONCERNING REPUBLIC'S PRODUCTIVE CAPACITY, WAS REQUIRED BY THE
REGULATION TO ISSUE A DETERMINATION OF NONRESPONSIBILITY.
SINCE THE CONTRACTING OFFICER DETERMINED THAT REPUBLIC WAS NOT
RESPONSIBLE FOR PURPOSES OF THIS PROCUREMENT, HE WAS UNDER A DUTY NOT TO
MAKE AN AWARD TO REPUBLIC EVEN THOUGH ITS PRICE WAS LOWER THAN THAT OF
ELECTROMAGNETIC TECHNOLOGY CORPORATION.
WE DO NOT AGREE WITH YOUR CONTENTION THAT THE FACTS IN OUR DECISION
REPORTED IN 45 COMP. GEN. 4 ARE SIMILAR TO THE FACTS IN THE INSTANT
PROTEST AND THAT THE PRINCIPLES STATED THEREIN SHOULD BE FOLLOWED. IN
THAT CASE, THE CONTRACTING OFFICER DID NOT HAVE BEFORE HIM ANY CONFLICT
OF SURVEYS, INFORMATION, OR DATA ON WHICH TO BASE HIS DECISION
CONCERNING THE BIDDER'S RESPONSIBILITY, WHEREAS THE CONTRACTING OFFICER
IN THE PRESENT CASE WAS REQUIRED TO MAKE A DETERMINATION CONCERNING
REPUBLIC'S RESPONSIBILITY IN THE FACE OF CONFLICTING REPORTS FROM DCASD
AND FRANKFORD ARSENAL. HOWEVER, 45 COMP. GEN. 4, 10, ALSO HELD THAT
WHERE THERE ARE CONFLICTING SURVEYS AS TO THE QUESTION OF
RESPONSIBILITY, AND OTHER FACTUAL INFORMATION AND DATA AVAILABLE, IT IS
THE PREROGATIVE OF THE CONTRACTING OFFICER TO CONSIDER AND WEIGH ALL
THESE EVIDENTIARY DATA AND TO MAKE THE DETERMINATION REQUIRED BY THE
APPLICATION OF HIS OWN BEST JUDGMENT THERETO. THIS RATIONALE IS
APPLICABLE TO THE FACTS OF THE INSTANT CASE.
B-166275(2), OCT. 17, 1969
BIDDERS--QUALIFICATIONS--PREAWARD SURVEYS--TECHNICAL CAPABILITY
WHERE REJECTED BIDDER WAS FOUND BY JOINT PREAWARD SURVEY TEAM TO BE
DEFICIENT IN 8 OF 11 TECHNICAL AND CONTRACTUAL FACTORS COMPRISING SURVEY
AND FINDINGS WERE SUSTAINED BY PREAWARD SURVEY REVIEW BOARD WHICH
RECOMMENDED NO AWARD, NO BASIS IS FOUND FOR QUESTIONING CONTRACTING
OFFICER'S DETERMINATION OF NONRESPONSIBILITY, AS IT IS CONTRACTING
OFFICER'S RESPONSIBILITY TO DETERMINE BIDDER'S RESPONSIBILITY AND SUCH
DETERMINATION WILL NOT BE QUESTIONED BY GENERAL ACCOUNTING OFFICE IN
ABSENCE OF BAD FAITH OR LACK OF SUBSTANTIAL EVIDENCE.
BIDDERS--QUALIFICATIONS--SMALL BUSINESS CONCERNS--NONREFERRAL FOR
CERTIFICATION JUSTIFICATION
WHERE 6 LOWEST BIDDERS FOR CERTAIN REQUIREMENTS IN SUPPORT OF 20MM
ANTIAIRCRAFT ARTILLERY GUN WERE DETERMINED NONRESPONSIBLE BY CONTRACTING
OFFICER, AND CONTRACT WAS AWARDED TO 7TH LOW BIDDER, NO BASIS IS FOUND
TO QUESTION NONREFERRAL TO SMALL BUSINESS ADMINISTRATION (SBA), SINCE
CONTRACTING OFFICER COMPLIED WITH ARMED SERVICES PROCUREMENT REGULATION
1-705.4 (C) (IV), WHICH PROVIDES THAT REFERRAL NEED NOT BE MADE TO SBA
IF CONTRACTING OFFICER CERTIFIES IN WRITING AND HIS CERTIFICATE IS
APPROVED BY CHIEF OF PURCHASING OFFICE, THAT AWARD MUST BE MADE WITHOUT
DELAY, INCLUDES SUCH CERTIFICATE AND SUPPORTING DOCUMENTATION IN
CONTRACT FILE, AND PROMPTLY FURNISHES COPY TO SBA.
NEGOTIATION--AWARDS--PRICE ONE FACTOR IN DETERMINATION
CONCERNING PROTESTANT REJECTED BIDDER'S CONTENTION THAT GOVERNMENT
COULD SAVE $625,000 BY AWARDING CONTRACT TO IT, CONTRACTING OFFICER WAS
UNDER DUTY NOT TO AWARD TO PROTESTANT, EVEN THOUGH ITS PRICE WAS LOWER
THAN AWARDEE'S AS HE HAD DETERMINED PROTESTANT NOT RESPONSIBLE FOR
PURPOSES OF SUBJECT PROCUREMENT; ASPR 1-902 PROVIDES THAT CONTRACT
AWARD TO SUPPLIER BASED ON LOWEST EVALUATED PRICE CAN BE FALSE ECONOMY
IF SUBSEQUENT UNSATISFACTORY PERFORMANCE RESULTING IN ADDITIONAL COSTS
ENSUES, THAT WHILE IT IS IMPORTANT THAT GOVT. PURCHASE BE MADE AT LOWEST
PRICE THIS DOES NOT REQUIRE AWARD TO SUPPLIER SOLELY BECAUSE IT SUBMITS
LOWEST BID, AND THAT PROSPECTIVE CONTRACTOR MUST AFFIRMATIVELY
DEMONSTRATE ITS RESPONSIBILITY.
(EGOTIATION--PUBLIC EXIGENCY--PRIORITY DESIGNATION PURCHASES
CONCERNING REJECTED BIDDER'S CONTENTION THAT CONTRACTING OFFICER'S
ISSUANCE OF CERTIFICATE OF URGENCY AT TIME OF AWARD TO LARGE BUSINESS
FIRM WAS MADE ON BASIS OF SOUTH EAST ASIA 02 PRIORITY ALTHOUGH, IN FACT,
REQUEST FOR PROPOSALS SHOWED ONLY DO-A5 RATING, PROTESTANT APPARENTLY
HAS CONFUSED SEA-02 PRIORITY WITH DO-A5 PRIORITY RATING; SEA-02
PRIORITY IS ISSUE PRIORITY DESIGNATOR USED WITHIN GOVERNMENT TO EXPRESS
RELATIVE URGENCY OF PROCUREMENT AND DELIVERY SCHEDULES, WHEREAS DO-A5
PRIORITY RATING IS DESIGNATION RELATED TO ASSIGNMENT OF PRIORITY RATINGS
UNDER DEFENSE MATERIALS SYSTEM FOR ACQUISITION OF CERTAIN CRITICAL
MATERIALS, AND PROCUREMENT FILE IS ADEQUATELY DOCUMENTED TO ESTABLISH
EXISTENCE OF SEA-02 PRIORITY UPON WHICH PROCUREMENT AND DELIVERY
SCHEDULE IS BASED.
TO POLARAD ELECTRONICS CORP.:
FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF FEBRUARY 28, 1969,
PROTESTING THE AWARD OF A CONTRACT TO ELECTROMAGNETIC TECHNOLOGY
CORPORATION UNDER REQUEST FOR PROPOSALS (RFP) NO. DAAA25-69-R-0148,
ISSUED BY THE DEPARTMENT OF THE ARMY, FRANKFORD ARSENAL, PHILADELPHIA,
PENNSYLVANIA. YOU REQUEST THAT THE CONTRACT BE CANCELED AND THE AWARD
MADE TO YOUR FIRM AS THE LOWEST RESPONSIBLE SMALL BUSINESS OFFEROR AT A
PRICE $625,000 LESS THAN THE AWARD PRICE.
A PRESOLICITATION NOTICE WAS ISSUED BY FRANKFORD ARSENAL ON SEPTEMBER
23, 1968, TO 32 POTENTIAL SOURCES FOR CERTAIN REQUIREMENTS IN SUPPORT OF
THE 20MM ANTIAIRCRAFT ARTILLERY GUN, XM163 (SELF-PROPELLED) AND XM167
(TOWED). THE PRESOLICITATION NOTICE INCLUDED AN ANNOUNCEMENT OF A
PREPROPOSAL CONFERENCE TO BE HELD AT FRANKFORD ARSENAL SHORTLY AFTER THE
ISSUANCE OF THE RFP, FOR THE PURPOSE OF PROVIDING PROSPECTIVE OFFERORS
WITH AN EXPLANATION AND DISCUSSION OF TECHNICAL AND CONTRACTUAL
REQUIREMENTS.
A DETAILED SYNOPSIS OF THE PROPOSED PROCUREMENT WAS PUBLISHED IN THE
DEPARTMENT OF COMMERCE BUSINESS DAILY ON SEPTEMBER 27, 1968. THE
SYNOPSIS INCLUDED THE ANNOUNCEMENT OF THE PREPROPOSAL CONFERENCE AND
INSTRUCTIONS FOR ATTENDANCE. IT EXPRESSED THE GOVERNMENT'S SEARCH FOR
"INTERESTED FIRMS POSSESSING SUPERIOR CAPABILITIES AND EXPERIENCE IN
SUCH RELATED FIELDS AS X-BAND MICROWAVE, DOPPLER RADARS, ELECTROMAGNETIC
COMPATIBILITY REQUIREMENTS AND DIGITAL HARDWARE EXPERIENCE.'
THE RFP WAS ISSUED ON OCTOBER 3, 1968, PURSUANT TO DETERMINATIONS AND
FINDINGS WHICH CITED THE PUBLIC EXIGENCY EXCEPTION LISTED IN 10 U.S.C.
2304 (A) (2) AS JUSTIFYING NEGOTIATION. THE RFP WAS ISSUED TO 32
PROSPECTIVE SOURCES AND WAS SUBSEQUENTLY FURNISHED TO OTHER PROSPECTIVE
SOURCES WHO RESPONDED TO THE PUBLISHED SYNOPSIS AND OTHER TRADE MEDIA.
THE RFP INCLUDED, ON PAGE 1, A "CAVEAT" ADVISING ALL OFFERORS THAT THIS
SOLICITATION REPRESENTED THE INITIAL COMPETITIVE PROCUREMENT OF THE
ITEMS DESCRIBED IN THE RFP. IN ADDITION, THE RFP DESCRIBED, ON PAGE 39,
THE PREAWARD SURVEY FACTORS APPLICABLE TO THIS PROCUREMENT.
THE PREPROPOSAL CONFERENCE WAS HELD AT FRANKFORD ARSENAL ON OCTOBER
17, 1968. OFFERORS ATTENDING THE CONFERENCE WERE PROVIDED WITH A
DETAILED EXPLANATION OF THE CONTRACTUAL REQUIREMENTS, PARTICULARLY THE
PREPRODUCTION EVALUATION FOR THE TECHNICAL DATA AND THE DESIGN AND
PERFORMANCE CHARACTERISTICS OF THE EQUIPMENT -- INCLUDING A DISPLAY OF
ACTUAL PRODUCTION UNITS. BY AMENDMENT NO. 003 TO THE RFP, THE CLOSING
DATE WAS EXTENDED FROM NOVEMBER 29, 1968, TO DECEMBER 10, 1968.
OF THE 15 OFFERS RECEIVED AND OPENED ON DECEMBER 10, 1968, THE SEVEN
LOWEST OFFERS, AS EVALUATED, ARE AS FOLLOWS:
(1) G.C. DEWEY CORP. $8,718,306.40
(2) COSMOS INDUSTRIES, INC. 8,930,813.46
(3) REPUBLIC ELECTRONICS INDS. CORP. 9,073,329.55
(4) POLARAD ELECTRONICS CORP. 9,220,368.04
(5) FREQUENCY ENGINEERING LABS. 9,322,151.51
(6) APPLIED DEVICES CORP. 9,736,655.00
(7) ELECTROMAGNETIC TECHNOLOGY CORP. 9,845,627.93
THE LOW BID OF THE G.C. DEWEY CORP. WAS REJECTED BECAUSE THE FIRM WAS
DETERMINED TO BE NONRESPONSIBLE. ALSO THE BIDS OF YOUR FIRM, COSMOS
INDUSTRIES, INC., REPUBLIC ELECTRONICS, FREQUENCY ENGINEERING LABS., AND
APPLIED DEVICES CORP. WERE REJECTED BECAUSE THE CONTRACTING OFFICER HAD
DETERMINED THAT YOUR FIRM AND THE OTHER COMPANIES WERE NONRESPONSIBLE
FOR PURPOSES OF THIS PROCUREMENT. ON FEBRUARY 19, 1969, A CONTRACT WAS
AWARDED TO ELECTROMAGNETIC TECHNOLOGY CORP. IN THE AMOUNT OF
$9,845,627.93.
THE GROUNDS FOR YOUR PROTEST AS SET FORTH IN YOUR TELEGRAM ARE AS
FOLLOWS:
"1. POLARAD BELIEVES IT TO BE THE LOWEST RESPONSIVE BIDDER AT A
PRICE $625,000 LESS THAN THE AWARD PRICE.
"2. THE PROCEDURES APPLICABLE TO SMALL BUSINESS WERE NOT FOLLOWED
DESPITE ENCOURAGEMENT BY THE ARSENAL TO MANY SMALL BUSINESSES TO BUY THE
MICROFILM FOR $1,300 AND TO ENGAGE IN A COSTLY BIDDING EFFORT.
"3. THE PREJUDICIAL AND HOSTILE MANNER OF THE TECHNICAL
REPRESENTATIVES OF THE ARSENAL IN CONDUCTING THE PREAWARD SURVEY WAS
SUGGESTIVE OF PRE-JUDGMENT AND COMPLETE LACK OF OBJECTIVITY.
"4. THE BASIS FOR DISREGARDING POLARAD'S LOWER QUOTATION WAS FOUNDED
ON AN EVALUATION FACTOR NOT CLEARLY SET FORTH IN THE RFQ IE AN
UNREASONABLE EMPHASIS ON RADAR DESIGN STAFF AVAILABLE.
"5. THE ISSUANCE OF A CERTIFICATE OF URGENCY BY THE CONTRACTING
OFFICER AT THE TIME OF AWARD TO A LARGE BUSINESS FIRM ON THE BASIS THAT
SOUTH EAST ASIA PRIORITY 02 WAS SET FORTH IN THE RFQ, WHEN IN ACTUALITY
THE RFP SHOWED ONLY A DO-A5 RATING.'
THE RECORD SHOWS THAT A JOINT DEFENSE CONTRACT ADMINISTRATION
SERVICES DISTRICT (DCASD), NEW YORK/FRANKFORD ARSENAL PREAWARD SURVEY
WAS CONDUCTED AT POLARAD'S FACILITY ON JANUARY 15, 16 AND 17, 1969. WE
ARE ADVISED THAT THE FRANKFORD ARSENAL TECHNICAL PARTICIPANTS WERE
PROFESSIONALLY QUALIFIED AND WERE TECHNICALLY FAMILIAR WITH THE
EQUIPMENT AND ITS EVOLUTION FROM RESEARCH AND DEVELOPMENT THROUGH
CURRENT PRODUCTION.
THE JOINT PREAWARD SURVEY TEAM FOUND POLARAD TO BE DEFICIENT IN EIGHT
OF 11 FACTORS COMPRISING THE SURVEY. THESE FINDINGS WERE SUSTAINED BY
THE PREAWARD SURVEY REVIEW BOARD AT THE DCASD, NEW YORK, IN ITS FEBRUARY
14, 1969, REPORT WHEREIN THEY RECOMMENDED "NO AWARD.' ACCORDINGLY, THE
CONTRACTING OFFICER DETERMINED POLARAD TO BE "NONRESPONSIBLE" AND
EXECUTED A WRITTEN DETERMINATION TO THAT EFFECT ON FEBRUARY 14, 1969.
ON FEBRUARY 17, 1969, THE BOARD OF AWARDS AT FRANKFORD ARSENAL
REVIEWED THE PROPOSED PROCUREMENT AND CONCURRED IN THE RECOMMENDATION
FOR AWARD TO ELECTROMAGNETIC TECHNOLOGY CORP., AS THE LOWEST RESPONSIVE
AND RESPONSIBLE OFFEROR. REVIEW AND APPROVAL OF THE PROPOSED AWARD BY
THE HEAD OF THE PROCURING ACTIVITY (UNITED STATES ARMY WEAPONS COMMAND)
WAS ACCOMPLISHED ON FEBRUARY 18, 1969. AWARD WAS MADE TO
ELECTROMAGNETIC TECHNOLOGY CORP. ON FEBRUARY 19, 1969, AND NOTICES TO
UNSUCCESSFUL OFFERORS WERE ISSUED ON FEBRUARY 20, 1969.
WITH RESPECT TO YOUR CONTENTION THAT PROCEDURES APPLICABLE TO SMALL
BUSINESS WERE NOT FOLLOWED, WE NOTE THAT THE RFP WAS ISSUED UNDER AN
SEA-02 URGENCY PRIORITY. ON FEBRUARY 5, 1969, THE CONTRACTING OFFICER
REQUESTED THE USING AGENCY TO ADVISE WHETHER THE PROGRAM WAS STILL
URGENT. ON FEBRUARY 11, 1969, THE USING AGENCY REAFFIRMED THE URGENCY
OF THE PROCUREMENT. A WRITTEN STATEMENT SETTING FORTH THE REASONS FOR
NONREFERRAL TO THE SMALL BUSINESS ADMINISTRATION (SBA) WAS MADE PART OF
THE CONTRACT FILE IN ACCORDANCE WITH THE ARMED SERVICES PROCUREMENT
REGULATION (ASPR) 1-705.4 (C) (IV). THAT SUBSECTION PROVIDES: "A
REFERRAL NEED NOT BE MADE TO THE SBA IF THE CONTRACTING OFFICER
CERTIFIES IN WRITING AND HIS CERTIFICATE IS APPROVED BY THE CHIEF OF THE
PURCHASING OFFICE, THAT THE AWARD MUST BE MADE WITHOUT DELAY, INCLUDES
SUCH CERTIFICATE AND SUPPORTING DOCUMENTATION IN THE CONTRACT FILE, AND
PROMPTLY FURNISHES A COPY TO THE SBA. * * *" SINCE THE CONTRACTING
OFFICER COMPLIED WITH THE ABOVE-CITED SUBSECTION, WE FIND NO BASIS TO
QUESTION THE NONREFERRAL TO SBA. SEE B-163967, SEPTEMBER 26, 1968.
THE CONTRACTING OFFICER DENIES YOUR CONTENTION THAT SMALL BUSINESS
WAS ENCOURAGED "TO BUY THE MICROFILM FOR $1,300 AND TO ENGAGE IN A
COSTLY BIDDING EFFORT.' THE TECHNICAL DATA PACKAGE WAS AVAILABLE TO ALL
PROSPECTIVE OFFERORS UPON PAYMENT OF A DEPOSIT OF $1,300, AND PAGE 42 OF
THE RFP INDICATES THAT THIS DEPOSIT WAS REFUNDABLE TO ALL CONCERNS WHO
SUBMITTED A TIMELY PROPOSAL IN GOOD FAITH. WE ARE ADVISED THAT THE
CONTRACTING OFFICER HAS DIRECTED THE REFUND OF THESE DEPOSITS AND
REFUNDS HAVE BEEN ACCOMPLISHED.
THE RECORD FAILS TO SUPPORT YOUR CONTENTION THAT THE TECHNICAL
REPRESENTATIVES OF THE ARSENAL CONDUCTED THE PREAWARD SURVEY IN A MANNER
SUGGESTING PREJUDGMENT AND COMPLETE LACK OF OBJECTIVITY AS WELL AS
HOSTILITY. WE ARE ADVISED THAT PERSONNEL WHO CONDUCTED THE PREAWARD
SURVEY ARE RESPONSIBLE AND FAIR-MINDED EMPLOYEES INTERESTED PRIMARILY IN
DETERMINING WHETHER THE OFFEROR HAD THE ABILITY, CAPACITY, AND THE
SKILLS REQUIRED TO PERFORM THE CONTRACT. ALSO, WE ARE ADVISED THAT THE
PREAWARD SURVEY TEAM WAS COMPOSED OF SELECTED PEOPLE FROM DCASD AND
SELECTED TECHNICAL PEOPLE FROM THE FRANKFORD ARSENAL, ALL OF WHOM ARE
EXPERIENCED IN CONDUCTING PREAWARD SURVEYS.
THE PREAWARD SURVEY REVIEW BOARD OF DCASD, NEW YORK RECOMMENDED THAT
NO AWARD BE MADE TO POLARAD BECAUSE IT FOUND YOUR FIRM TO BE
UNSATISFACTORY AS TO TECHNICAL CAPABILITY, PRODUCTION CAPABILITY, PLANT
FACILITIES, PURCHASING AND SUBCONTRACTING, QUALITY ASSURANCE CAPABILITY,
LABOR RECORD, PERFORMANCE RECORD, AND THE ABILITY TO MEET THE REQUIRED
SCHEDULE. IN VIEW THEREOF, WE CANNOT AGREE WITH YOUR CONTENTION THAT
POLARAD WAS FOUND NONRESPONSIBLE ON AN EVALUATION FACTOR NOT CLEARLY SET
FORTH IN THE RFP, I.E., AN UNREASONABLE EMPHASIS ON THE RADAR DESIGN
STAFF AVAILABLE. THE RFP WAS QUITE SPECIFIC IN SETTING FORTH, ON PAGE
39, THE EVALUATION FACTORS AND REPEATEDLY EMPHASIZED THE NECESSITY FOR
RADAR DESIGN EXPERIENCE. WE ARE ADVISED THAT AT A PREPROPOSAL CONFERENCE
HELD ON OCTOBER 17, 1968, AT WHICH POLARAD WAS PRESENT, ATTENTION WAS
INVITED TO THE REQUIREMENTS FOR THE PREAWARD SURVEY. IN ADDITION,
ANSWERS WERE PROVIDED IN DEPTH TO NUMEROUS QUESTIONS RAISED ON VARIOUS
TECHNICAL AND CONTRACTUAL ASPECTS OF THE RFP.
YOU CONTEND THAT THE ISSUANCE OF A CERTIFICATE OF URGENCY AT THE TIME
OF AWARD WAS MADE ON THE BASIS OF AN SEA-02 PRIORITY ALTHOUGH, IN FACT,
THE RFP SHOWED ONLY A DO-A5 RATING. IT APPEARS THAT POLARAD HAS
CONFUSED THE SEA-02 PRIORITY WITH THE DO-A5 PRIORITY RATING. THE SEA-02
PRIORITY IS AN ISSUE PRIORITY DESIGNATOR USED WITHIN THE GOVERNMENT TO
EXPRESS THE RELATIVE URGENCY OF PROCUREMENT AND DELIVERY SCHEDULES,
WHEREAS THE DO-A5 PRIORITY RATING IS A DESIGNATION RELATED TO THE
ASSIGNMENT OF PRIORITY RATINGS UNDER THE DEFENSE MATERIALS SYSTEM FOR
THE ACQUISITION OF CERTAIN CRITICAL MATERIALS. THE PROCUREMENT FILE IS
ADEQUATELY DOCUMENTED TO ESTABLISH THE EXISTENCE OF AN SEA-02 PRIORITY
UPON WHICH THE PROCUREMENT AND DELIVERY SCHEDULE IS BASED.
ALTHOUGH YOU CONTEND THAT THE GOVERNMENT COULD SAVE $625,000 BY
AWARDING THE CONTRACT TO POLARAD, WE DRAW YOUR ATTENTION TO ASPR 1-902
WHICH STATES IN PERTINENT PART AS FOLLOWS:
"* * * THE AWARD OF A CONTRACT TO A SUPPLIER BASED ON LOWEST
EVALUATED PRICE ALONE CAN BE FALSE ECONOMY, IF THERE IS A SUBSEQUENT
DEFAULT, LATE DELIVERIES, OR OTHER UNSATISFACTORY PERFORMANCE RESULTING
IN ADDITIONAL PROCUREMENT OR ADMINISTRATIVE COSTS. WHILE IT IS
IMPORTANT THAT GOVERNMENT PURCHASE BE MADE AT THE LOWEST PRICE, THIS
DOES NOT REQUIRE AN AWARD TO A SUPPLIER SOLELY BECAUSE HE SUBMITS THE
LOWEST BID OR OFFER. A PROSPECTIVE CONTRACTOR MUST DEMONSTRATE
AFFIRMATIVELY HIS RESPONSIBILITY, * * *"
SINCE THE CONTRACTING OFFICER DETERMINED THAT YOUR FIRM WAS NOT
RESPONSIBLE FOR PURPOSES OF THIS PROCUREMENT, HE WAS UNDER A DUTY NOT TO
AWARD TO YOUR FIRM EVEN THOUGH YOUR PRICE WAS LOWER THAN THAT OF
ELECTROMAGNETIC TECHNOLOGY CORPORATION.
WE HAVE CONSISTENTLY HELD THAT IT IS THE RESPONSIBILITY OF THE
CONTRACTING OFFICER TO DETERMINE THE RESPONSIBILITY OF A BIDDER AND THAT
SUCH DETERMINATION WILL NOT BE QUESTIONED BY OUR OFFICE IN THE ABSENCE
OF BAD FAITH OR LACK OF SUBSTANTIAL EVIDENCE. 37 COMP. GEN. 430; 38
ID. 248; 39 ID. 228. WE FIND NO BASIS ON THE RECORD BEFORE US TO
QUESTION THE CONTRACTING OFFICER'S DETERMINATION OF NONRESPONSIBILITY IN
THIS CASE.
B-166275(3), OCT. 17, 1969
BIDDERS--QUALIFICATIONS--PREAWARD SURVEYS--UNSATISFACTORY
WHERE PROTESTANT AND 6 OTHER OFFERORS WERE REJECTED FOR
NONRESPONSIBILITY AND PREAWARD SURVEY FOUND PROTESTANT DEFICIENT IN 7 OF
11 TECHNICAL EVALUATING FACTORS, WHICH FINDINGS WERE SUSTAINED BY
PREAWARD SURVEY REVIEW BOARD, PROTEST TO AWARD TO CONTRACTOR AT PRICE OF
ALMOST $1,000,000 HIGHER THAN PROTESTANT'S IS DENIED SINCE IT IS
RESPONSIBILITY OF CONTRACTING OFFICER TO DETERMINE BIDDER'S
RESPONSIBILITY AND SUCH DETERMINATION WILL NOT BE QUESTIONED ABSENT BAD
FAITH OR LACK OF SUBSTANTIAL EVIDENCE. MOREOVER, UNDER ARMED SERVICES
PROCUREMENT REGULATION 1-902, CONTRACTING OFFICER IS NOT REQUIRED TO
MAKE AWARD SOLELY BECAUSE SUPPLIER SUBMITS LOWEST BID. CONSEQUENTLY,
SINCE CONTRACTING OFFICER DETERMINED PROTESTANT WAS NOT RESPONSIBLE, HE
WAS UNDER DUTY NOT TO AWARD CONTRACT TO PROTESTANT.
TO COSMOS INDUSTRIES, INC.:
FURTHER REFERENCE IS MADE TO YOUR LETTERS OF MARCH 14 AND 18, 1969,
PROTESTING THE AWARD OF A CONTRACT TO ELECTROMAGNETIC TECHNOLOGY
CORPORATION UNDER REQUEST FOR PROPOSALS (RFP) NO. DAAA25-69-R-0148,
ISSUED BY THE DEPARTMENT OF THE ARMY, FRANKFORD ARSENAL, PHILADELPHIA,
PENNSYLVANIA. YOU CONTEND THAT THE AWARD OF THE CONTRACT WAS IN
VIOLATION OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) APPENDIX
"K" RELATING TO PREAWARD SURVEY PROCEDURES; IN VIOLATION OF ASPR
RELATING TO EVALUATION AND SELECTION OF RESPONSIBLE PROSPECTIVE
CONTRACTORS; AND IS A DIVERSION OF ALMOST $1,000,000 (IN COMPARISON
ONLY TO THE COSMOS QUOTATION) OF GOVERNMENT FUNDS. YOU REQUEST THAT THE
AWARD BE SET ASIDE AND THE CONTRACT BE AWARDED TO YOUR COMPANY AS THE
LOWEST RESPONSIBLE BIDDER.
A PRESOLICITATION NOTICE WAS ISSUED BY FRANKFORD ARSENAL ON SEPTEMBER
23, 1968, TO 32 POTENTIAL SOURCES FOR CERTAIN REQUIREMENTS IN SUPPORT OF
THE 20MM ANTIAIRCRAFT ARTILLERY GUN, XM163 (SELF-PROPELLED) AND XM167
(TOWED). THE PRESOLICITATION NOTICE INCLUDED AN ANNOUNCEMENT OF A
PREPROPOSAL CONFERENCE TO BE HELD AT FRANKFORD ARSENAL SHORTLY AFTER THE
ISSUANCE OF THE RFP, FOR THE PURPOSE OF PROVIDING PROSPECTIVE OFFERORS
WITH AN EXPLANATION AND DISCUSSION OF THE TECHNICAL AND CONTRACTUAL
REQUIREMENTS.
A DETAILED SYNOPSIS OF THE PROPOSED PROCUREMENT WAS PUBLISHED
NATIONWIDE IN THE DEPARTMENT OF COMMERCE BUSINESS DAILY ON SEPTEMBER 27,
1968. THE SYNOPSIS INCLUDED THE ANNOUNCEMENT OF THE PREPROPOSAL
CONFERENCE AND INSTRUCTIONS FOR ATTENDANCE. IT EXPRESSED THE
GOVERNMENT'S SEARCH FOR ,INTERESTED FIRMS POSSESSING SUPERIOR
CAPABILITIES AND EXPERIENCE IN SUCH RELATED FIELDS AS X-BAND MICROWAVE,
DOPPLER RADARS, ELECTROMAGNETIC COMPATIBILITY REQUIREMENTS AND DIGITAL
HARDWARE EXPERIENCE.'
THE RFP WAS ISSUED ON OCTOBER 3, 1968, PURSUANT TO DETERMINATIONS AND
FINDINGS WHICH CITED THE PUBLIC EXIGENCY EXCEPTION IN 10 U.S.C. 2304 (A)
(2) AS JUSTIFYING NEGOTIATION. THE RFP WAS ISSUED TO 32 PROSPECTIVE
SOURCES AND WAS SUBSEQUENTLY FURNISHED TO OTHER PROSPECTIVE SOURCES WHO
RESPONDED TO THE PUBLISHED SYNOPSIS AND OTHER TRADE MEDIA. THE RFP
INCLUDED, ON PAGE 1, A "CAVEAT" ADVISING ALL OFFERORS THAT THIS
SOLICITATION REPRESENTED THE INITIAL COMPETITIVE PROCUREMENT OF THE
ITEMS DESCRIBED IN THE RFP. IN ADDITION, THE RFP DESCRIBED, ON PAGE 39,
THE PREAWARD SURVEY FACTORS APPLICABLE TO THIS PROCUREMENT.
THE PREPROPOSAL CONFERENCE WAS HELD AT FRANKFORD ARSENAL ON OCTOBER
17, 1968. OFFERORS ATTENDING THE CONFERENCE WERE PROVIDED WITH A
DETAILED EXPLANATION OF THE CONTRACTUAL REQUIREMENTS, PARTICULARLY THE
PREPRODUCTION EVALUATION OF TECHNICAL DATA AND THE DESIGN AND
PERFORMANCE CHARACTERISTICS OF THE EQUIPMENT -- INCLUDING A DISPLAY OF
ACTUAL PRODUCTION UNITS. BY AMENDMENT NO. 003 TO THE RFP, THE CLOSING
DATE WAS EXTENDED FROM NOVEMBER 29, 1968, TO DECEMBER 10, 1968.
OF THE 15 OFFERS RECEIVED AND OPENED ON DECEMBER 10, 1968, THE 7
LOWEST OFFERS, AS EVALUATED, ARE AS FOLLOWS:
(1) G.C. DEWEY CORP. $8,718,306.40
(2) COSMOS INDUSTRIES, INC. 8,930,813.46
(3) REPUBLIC ELECTRONICS INDS. 9,073,329.55
(4) POLARAD ELECTRONICS CORP. 9,220,368.04
(5) FREQUENCY ENGINEERING LABS. 9,322,151.51
(6) APPLIED DEVICES CORP. 9,736,655.00
(7) ELECTROMAGNETIC TECHNOLOGY
CORP. 9,845,627.93
THE LOW BID OF THE G.C. DEWEY CORP. WAS REJECTED BECAUSE THE FIRM WAS
DETERMINED TO BE NONRESPONSIBLE. ALSO THE BIDS OF YOUR FIRM, REPUBLIC
ELECTRONICS, POLARAD, FREQUENCY ENGINEERING LABS AND APPLIED DEVICES
CORP. WERE REJECTED BECAUSE THE CONTRACTING OFFICER HAD DETERMINED THAT
YOUR FIRM AND THE OTHER COMPANIES WERE NONRESPONSIBLE FOR PURPOSES OF
THIS PROCUREMENT. ON FEBRUARY 19, 1969, A CONTRACT WAS AWARDED TO
ELECTROMAGNETIC TECHNOLOGY CORP. IN THE AMOUNT OF $9,845,627.93.
IN YOUR LETTER OF MARCH 14, 1969, YOU RAISE VARIOUS QUESTIONS
CONCERNING THE MANNER IN WHICH THE PREAWARD SURVEY WAS CONDUCTED. IN
GENERAL, YOU CONTEND THAT THE AWARD OF THE CONTRACT WAS IN VIOLATION OF
ASPR APPENDIX "K" RELATING TO PREAWARD SURVEY PROCEDURES. THESE
QUESTIONS WERE CONSIDERED AND ANSWERED IN DETAIL IN THE CONTRACTING
OFFICER'S ADMINISTRATIVE REPORT DATED APRIL 11, 1969, WHICH HAS BEEN
FURNISHED TO YOUR ATTORNEY. WE AGREE WITH THE ADMINISTRATIVE POSITION
IN THIS REGARD AND, THUS, THERE IS NO NEED TO DISCUSS THIS ASPECT OF
YOUR PROTEST.
THE RECORD SHOWS THAT A JOINT DEFENSE CONTRACT ADMINISTRATION
SERVICES DIVISION (DCASD), NEW YORK/FRANKFORD ARSENAL PREAWARD SURVEY
WAS CONDUCTED AT COSMOS' FACILITY ON DECEMBER 19 AND 20, 1968. WE ARE
ADVISED THAT THE FRANKFORD ARSENAL TECHNICAL PARTICIPANTS WERE
PROFESSIONALLY QUALIFIED AND WERE TECHNICALLY FAMILIAR WITH THE
EQUIPMENT AND ITS EVOLUTION FROM RESEARCH AND DEVELOPMENT THROUGH
CURRENT PRODUCTION.
THE JOINT PREAWARD SURVEY TEAM FOUND COSMOS TO BE DEFICIENT IN THE
FOLLOWING SEVEN OF THE 11 FACTORS COMPRISING THE SURVEY:
A. TECHNICAL CAPABILITY
B. PRODUCTION CAPABILITY
C. PLANT FACILITIES AND EQUIPMENT
D. PURCHASING AND SUBCONTRACTING
E. QUALITY ASSURANCE CAPABILITY
F. LABOR RESOURCE
G. ABILITY TO MEET REQUIRED SCHEDULE
THESE FINDINGS WERE SUSTAINED BY THE PREAWARD SURVEY REVIEW BOARD AT
DCASD, NEW YORK IN ITS JANUARY 24, 1969, REPORT AND RECOMMENDATION OF
"NO AWARD.' ACCORDINGLY, THE CONTRACTING OFFICER DETERMINED COSMOS TO BE
"NONRESPONSIBLE" AND EXECUTED A WRITTEN DETERMINATION TO THAT EFFECT ON
FEBRUARY 14, 1969.
ON FEBRUARY 17, 1969, THE BOARD OF AWARDS AT FRANKFORD ARSENAL
REVIEWED THE PROPOSED PROCUREMENT AND CONCURRED IN THE RECOMMENDATION
FOR AWARD TO ELECTROMAGNETIC TECHNOLOGY CORP., AS THE LOWEST RESPONSIVE
AND RESPONSIBLE OFFEROR. REVIEW AND APPROVAL OF THE PROPOSED AWARD BY
THE HEAD OF THE PROCURING ACTIVITY (UNITED STATES ARMY WEAPONS COMMAND)
WAS ACCOMPLISHED ON FEBRUARY 18, 1969. AWARD WAS MADE TO
ELECTROMAGNETIC TECHNOLOGY CORP. ON FEBRUARY 19, 1969. NOTICES TO
UNSUCCESSFUL OFFERORS WERE ISSUED ON FEBRUARY 20, 1969.
ALTHOUGH YOU CONTEND THAT THE GOVERNMENT WOULD HAVE SAVED $893,638.88
BY AWARDING THE CONTRACT TO COSMOS, WE DRAW YOUR ATTENTION TO ASPR 1-902
WHICH STATES IN PERTINENT PART AS FOLLOWS:
"* * * THE AWARD OF A CONTRACT TO A SUPPLIER BASED ON LOWEST
EVALUATED PRICE ALONE CAN BE FALSE ECONOMY IF THERE IS SUBSEQUENT
DEFAULT, LATE DELIVERIES, OR OTHER UNSATISFACTORY PERFORMANCE RESULTING
IN ADDITIONAL PROCUREMENT OR ADMINISTRATIVE COSTS. WHILE IT IS
IMPORTANT THAT GOVERNMENT PURCHASES BE MADE AT THE LOWEST PRICE, THIS
DOES NOT REQUIRE AN AWARD TO A SUPPLIER SOLELY BECAUSE HE SUBMITS THE
LOWEST BID OR OFFER. A PROSPECTIVE CONTRACTOR MUST DEMONSTRATE
AFFIRMATIVELY HIS RESPONSIBILITY, * * *"
SINCE THE CONTRACTING OFFICER DETERMINED THAT YOUR FIRM WAS NOT
RESPONSIBLE, HE WAS UNDER A DUTY NOT TO AWARD TO YOUR FIRM EVEN THOUGH
YOUR PRICE WAS LOWER THAN THAT OF ELECTROMAGNETIC TECHNOLOGY
CORPORATION.
WE HAVE CONSISTENTLY HELD THAT IT IS THE RESPONSIBILITY OF THE
CONTRACTING OFFICER TO DETERMINE THE RESPONSIBILITY OF A BIDDER AND THAT
SUCH DETERMINATION WILL NOT BE QUESTIONED BY OUR OFFICE IN THE ABSENCE
OF BAD FAITH OR LACK OF SUBSTANTIAL EVIDENCE. 37 COMP. GEN. 430; 38
ID. 248; 39 ID. 468; 43 ID. 228. WE FIND NO BASIS ON THE RECORD
BEFORE US TO QUESTION THE CONTRACTING OFFICER'S DETERMINATION OF
NONRESPONSIBILITY IN THIS CASE.
B-167302, OCT. 17, 1969
SPECIFICATIONS--CONFORMABILITY OF EQUIPMENT, ETC; OFFERED--TECHNICAL
DEFICIENCIES--ADMINISTRATIVE DETERMINATION CONCLUSIVENESS
UNDER REQUEST FOR PROPOSALS FOR MATERIAL AND SERVICES TO REFURBISH
LOUNGE AND WARDROOMS ABOARD U.S.S. AMERICA, WITH MINIMUM REQUIREMENTS
SET FORTH IN GENERAL TERMS, UNSUCCESSFUL OFFEROR WHO CONTENDS THAT
MINISCULE PRICE DIFFERENTIAL IN FAVOR OF LOW OFFEROR, IN LIGHT OF
ALLEGED SUPERIOR QUALITY OF PROTESTANT'S PROPOSAL, RESULTED IN UNFAIR
EVALUATION, OFFERS NO BASIS FOR OBJECTION SINCE IT IS PROVINCE OF
ADMINISTRATIVE OFFICERS TO DRAFT PROPER SPECIFICATIONS TO SUPPLY
GOVERNMENTAL NEEDS AND TO DETERMINE FACTUALLY WHETHER ARTICLES MEET
THOSE SPECIFICATIONS. ABSENT CLEAR SHOWING OF UNREASONABLENESS,
FAVORITISM OR VIOLATION OF STATUTES OR REGULATIONS, PROCURING ACTIVITY'S
DETERMINATION AS TO WHICH PROPOSAL IS TECHNICALLY SUPERIOR, WILL NOT BE
QUESTIONED. IN NEGOTIATED PROCUREMENT PRICE IS NOT SOLE CONSIDERATION.