A-14932, JULY 2, 1926, 6 COMP. GEN. 6

A-14932: Jul 2, 1926

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IS CONSTRUED AS NOT IN LEGISLATIVE INTENT APPLICABLE MUNICIPALITIES OR PUBLIC-SERVICE CORPORATIONS FURNISHING WATER. OR ELECTRICITY IN THOSE LOCALITIES WHERE THERE IS NO COMPETITION AND WHERE THE PRICES FOR THE SERVICES ARE UNDER STATE CONTROL. 1926: I HAVE YOUR LETTER OF JUNE 28. IS THAT EVERY PROPOSAL FOR NAVAL SUPPLIES INVITED BY THE SECRETARY OF THE NAVY UNDER THE PROVISIONS OF SECTION 3718. IF HIS BID IS ACCEPTED. WILL. PROVISION IS MADE BY SECTION 3721. HAVE NO APPLICATION TO SUCH PURCHASES. 5 COMP. PROVIDED THAT THE PROPER ADMINISTRATIVE OFFICERS ARE OF THE OPINION THAT THE LIMITATION OF $500 IS NOT DESIGNED TO EVADE COMPLIANCE WITH SECTION 3719. WHERE THERE IS NO COMPETITION AND WHERE THE PRICES FOR THE SERVICES ARE UNDER STATE CONTROL.

A-14932, JULY 2, 1926, 6 COMP. GEN. 6

NAVY CONTRACTS - SURETY BONDS THE REQUIREMENT OF SECTION 3719, REVISED STATUTES, WITH RESPECT TO THE FURNISHING OF A WRITTEN GUARANTEE OR BOND BY CONTRACTORS PROPOSING TO FURNISH SUPPLIES TO THE NAVY DEPARTMENT, IS CONSTRUED AS NOT IN LEGISLATIVE INTENT APPLICABLE MUNICIPALITIES OR PUBLIC-SERVICE CORPORATIONS FURNISHING WATER, GAS, OR ELECTRICITY IN THOSE LOCALITIES WHERE THERE IS NO COMPETITION AND WHERE THE PRICES FOR THE SERVICES ARE UNDER STATE CONTROL.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE NAVY, JULY 2, 1926:

I HAVE YOUR LETTER OF JUNE 28, 1926, REQUESTING DECISION WHETHER CONTRACTS FOR FURNISHING DURING THE FISCAL YEAR 1927, WATER, GAS, OR ELECTRICITY TO THE VARIOUS ACTIVITIES UNDER THE NAVY DEPARTMENT MAY BE ENTERED INTO WITH MUNICIPALITIES OR PUBLIC-SERVICE CORPORATIONS WITHOUT A SUPPORTING GUARANTEE OR BOND.

THE REQUIREMENT OF SECTION 3719, REVISED STATUTES, IS THAT EVERY PROPOSAL FOR NAVAL SUPPLIES INVITED BY THE SECRETARY OF THE NAVY UNDER THE PROVISIONS OF SECTION 3718, REVISED STATUTES, SHALL BE ACCOMPANIED BY A WRITTEN GUARANTEE SIGNED BY ONE OR MORE RESPONSIBLE PERSONS TO THE EFFECT THAT HE OR THEY UNDERTAKE THAT THE BIDDER, IF HIS BID IS ACCEPTED, WILL, AT SUCH TIME AS MAY BE PRESCRIBED BY THE SECRETARY OF THE NAVY, GIVE BOND WITH GOOD AND SUFFICIENT SURETIES TO FURNISH THE SUPPLIES PROPOSED, AND THAT NO PROPOSAL SHALL BE CONSIDERED UNLESS ACCOMPANIED BY SUCH GUARANTEE. PROVISION IS MADE BY SECTION 3721, REVISED STATUTES, FOR THE PURCHASE BY THE NAVY DEPARTMENT, WITHOUT ADVERTISEMENT, OF ORDNANCE, GUN POWDER, OR MEDICINES OR THE SUPPLIES WHICH IT MAY BE NECESSARY TO PURCHASE OUT OF THE UNITED STATES FOR VESSELS ON FOREIGN STATIONS, AND THE PROVISIONS OF SECTION 3719, REVISED STATUTES, HAVE NO APPLICATION TO SUCH PURCHASES. 5 COMP. GEN. 762. THE ACT OF MARCH 2, 1907, 34 STAT. 1193, MAKES AN EXCEPTION, WITH RESPECT TO THE REQUIREMENT OF FORMAL CONTRACT OR BOND, IN THE CASE WHERE THE AGGREGATE AMOUNT OF SUPPLIES TO BE PURCHASED DOES NOT EXCEED THE SUM OF $500, PROVIDED THAT THE PROPER ADMINISTRATIVE OFFICERS ARE OF THE OPINION THAT THE LIMITATION OF $500 IS NOT DESIGNED TO EVADE COMPLIANCE WITH SECTION 3719, REVISED STATUTES, 5 COMP. GEN. 628.

THERE WOULD APPEAR TO BE NO REASONABLE NEED, IN THE CASE OF MUNICIPALITIES OR PUBLIC-SERVICE CORPORATIONS FURNISHING WATER, GAS, OR ELECTRICITY TO ACTIVITIES OF THE NAVY DEPARTMENT, WHERE THERE IS NO COMPETITION AND WHERE THE PRICES FOR THE SERVICES ARE UNDER STATE CONTROL, TO REQUIRE OF THEM A BOND THAT THEY WILL FURNISH THE SERVICE PROPOSED OR CONTRACTED FOR. I HAVE TO ADVISE THEREFORE, THAT THE REQUIREMENT OF SECTION 3719, REVISED STATUTES, MAY BE CONSTRUED AS NOT IN LEGISLATIVE INTENT APPLICABLE TO THEM.