Acceptability of Power of Attorney Authorization

A contracting officer of the Forest Service requested views on whether a particular Power of Attorney was adequate evidence of authority as the signer of the payment and performance bonds. The attorney-in-fact signed forms on behalf of the surety stating that he was authorized to execute bonds not to exceed $250,000. The amount of the performance bond which he signed was $222,180. As the total potential liability of the firm is $333,270 the contracting officer questioned whether the liability may exceed the authority of the Power of Attorney. GAO found that neither of the bonds which the attorney signed exceeded $250,000, thus he did not exceed his authority. Although GAO believes that the Government's rights would be adequately protected on the basis of the existing documentation, it suggested that the contracting officer obtain another copy of the Power of Attorney with a notation specifically mentioning the amount of the payment bond. GAO also suggested that the contracting officer obtain adequate assurance that the qualifications which apply to the limitation to bonds having 80 percent and/or 90 percent indemnification of the Small Business Administration are satisfied.