A-44458, SEPTEMBER 10, 1932, 12 COMP. GEN. 340

A-44458: Sep 10, 1932

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ECONOMY ACT - CONTRACT EMPLOYMENT PAYMENTS UNDER A NONPERSONAL SERVICE CONTRACT ENTERED INTO BETWEEN THE DISTRICT OF COLUMBIA AND A SUBMARINE DIVER FOR SERVICES AND EQUIPMENT ARE NOT SUBJECT TO REDUCTION UNDER THE PROVISIONS OF THE ECONOMY ACT. THE PRINCIPAL CONSIDERATION WAS NOT FOR PERSONAL SERVICES ALONE BUT FOR OTHER NECESSARY FACILITIES WHICH WERE REQUIRED TO MAKE THE TESTS. YOU HELD THAT CONTRACT SURGEONS OF THE ARMY ARE NOT EXEMPT FROM THE OPERATION OF THE ECONOMY ACT. - "ARE EMPLOYEES WHOSE SERVICES ARE ENGAGED UNDER SPECIFIC CONTRACTS BY THE NAVAL RESEARCH LABORATORY AFFECTED BY THE SO-CALLED ECONOMY PROVISIONS OF THE LEGISLATIVE ACT ABOVE CITED? HARRISON WAS NOT IN EFFECT PRIOR TO JUNE 30.

A-44458, SEPTEMBER 10, 1932, 12 COMP. GEN. 340

ECONOMY ACT - CONTRACT EMPLOYMENT PAYMENTS UNDER A NONPERSONAL SERVICE CONTRACT ENTERED INTO BETWEEN THE DISTRICT OF COLUMBIA AND A SUBMARINE DIVER FOR SERVICES AND EQUIPMENT ARE NOT SUBJECT TO REDUCTION UNDER THE PROVISIONS OF THE ECONOMY ACT.

COMPTROLLER GENERAL MCCARL TO THE PRESIDENT OF THE BOARD OF COMMISSIONERS OF THE DISTRICT OF COLUMBIA, SEPTEMBER 10, 1932:

CONSIDERATION HAS BEEN GIVEN TO YOUR LETTER OF SEPTEMBER 1, 1932, AS FOLLOWS:

UNDER DATE OF JULY 29, 1932, THE COMMISSIONERS, BY FORMAL ORDER, EMPLOYED CHARLES E. HEINEMAN AS SUBMARINE DIVER TO MAKE A COMPLETE UNDERWATER EXAMINATION OF THE PIERS AND ABUTMENTS OF THE ANACOSTIA AND OUTLET BRIDGES, AT $35.00 PER DAY, WHICH PRICE INCLUDED ALL NECESSARY EQUIPMENT. IN ADDITION TO MR. HEINEMAN'S PERSONAL SKILL HE FURNISHED THE DISTRICT OF COLUMBIA SUBMARINE EQUIPMENT, SCOW, AIR PUMPS, AIR LINES, PLANT, LAUNCH, AND DIVING SUIT, WITH THE NECESSARY LABOR AND TRANSPORTATION FOR SAID EQUIPMENT TO THE VARIOUS PIERS AND ABUTMENTS. THE PRINCIPAL CONSIDERATION WAS NOT FOR PERSONAL SERVICES ALONE BUT FOR OTHER NECESSARY FACILITIES WHICH WERE REQUIRED TO MAKE THE TESTS. MR. HEINEMAN HAS SUBMITTED A VOUCHER FOR FIVE DAYS, AUGUST 8 TO AUGUST 12, INCLUSIVE, OR $175.00, AND HAS DECLINED TO ACCEPT LESS.

UNDER DATE OF JULY 14, 1932 (A-43204), YOU HELD THAT CONTRACT SURGEONS OF THE ARMY ARE NOT EXEMPT FROM THE OPERATION OF THE ECONOMY ACT, AND ON AUGUST 2, 1932 (A-43615), IN ANSWER TO THE FOLLOWING QUESTION PRESENTED BY THE SECRETARY OF THE NAVY---

"ARE EMPLOYEES WHOSE SERVICES ARE ENGAGED UNDER SPECIFIC CONTRACTS BY THE NAVAL RESEARCH LABORATORY AFFECTED BY THE SO-CALLED ECONOMY PROVISIONS OF THE LEGISLATIVE ACT ABOVE CITED?

YOU HELD THAT---

"THE CONTRACT WITH BERTRAM M. HARRISON WAS NOT IN EFFECT PRIOR TO JUNE 30, 1932, AS IT WAS NOT EXECUTED UNTIL JULY 14, 1932, AND IT IS NOT FOR A LUMP SUM BUT FOR COMPENSATION AT A PER DIEM RATE OF $7.50, WHICH, MULTIPLIED BY 307 DAYS, AS IN PARAGRAPH 104 (C), SUPRA, WILL MAKE AN ANNUAL RATE OF $2,307.50. IT DOES NOT, THEREFORE, COME WITHIN THE EXCEPTION (11) OF PARAGRAPH 104 (A), AND AS THE SERVICES ARE STRICTLY PERSONAL AND THE CONTRACTOR COMES WITHIN THE DEFINITION OF "OFFICER" AND "EMPLOYEE," THE PROVISIONS OF EITHER SECTION 101 (A) OR 101 (B) OF THE ECONOMY ACT MUST BE APPLIED TO THE EMPLOYMENT OF MR. HARRISON, AND THE AMOUNT OF THE REDUCTION IN COMPENSATION MUST BE IMPOUNDED.'

FROM THE FOREGOING IT WOULD APPEAR THAT SERVICES UNDER CONTRACT WHICH ARE STRICTLY PERSONAL COME WITHIN THE DEFINITION OF "OFFICERS" AND "EMPLOYEES" AND ARE SUBJECT TO THE PROVISIONS OF THE ECONOMY ACT. HOWEVER, IN THE CASE OF CHARLES E. HEINEMAN, THE SERVICES RENDERED ARE NOT ALL OF A PERSONAL NATURE, SINCE OTHER CONSIDERATIONS ENTERED INTO THE CONTRACT PRICE.

ASSUMING COMPETITION TO BE IMPRACTICABLE, KINDLY ADVISE THE COMMISSIONERS AT YOUR EARLIEST CONVENIENCE WHETHER ANY ECONOMY DEDUCTIONS SHOULD BE MADE FROM THE AMOUNT EARNED UNDER THIS CONTRACT.

IN DECISION OF SEPTEMBER 2, 1932, A-43984, 12 COMP. GEN. 322, IT WAS STATED:

* * * WHERE THE SERVICE PERFORMED UNDER A CONTRACT IS SUCH THAT IT MAY BE COVERED BY SPECIFICATIONS AND THE CONTRACT THEREFOR AWARDED EITHER TO AN INDIVIDUAL, A FIRM, OR A CORPORATION, THERE IS NOT INVOLVED THE RENDERING OF SERVICES OF ANY PERSON IN OR UNDER ANY BRANCH OR SERVICE OF THE GOVERNMENT WITHIN THE MEANING OF THE DEFINITION OF THE TERMS "OFFICER" AND ,EMPLOYEE" IN SECTION 104 OF THE ECONOMY ACT, AND THE CONTRACT PAYMENTS TO THE HOLDER OF SUCH A CONTRACT, WHETHER A CORPORATION, A FIRM, OR AN INDIVIDUAL, ARE NOT SUBJECT TO PERCENTAGE OR OTHER REDUCTIONS UNDER THE PROVISIONS OF TITLE I OF THE ECONOMY ACT. AS THE CONTRACTS FOR COURT REPORTING SERVICE MAY BE COVERED BY SPECIFICATIONS, SUBMITTED TO COMPETITION, AND AWARDED EITHER TO AN INDIVIDUAL, A FIRM, OR CORPORATION, THE RULE ABOVE STATED IS APPLICABLE AND, ACCORDINGLY, THE CONTRACT PAYMENTS ARE NOT SUBJECT TO REDUCTIONS UNDER THE PROVISIONS OF TITLE I OF THE ECONOMY ACT.

IT IS UNDERSTOOD THE SERVICES PERFORMED BY THIS SUBMARINE DIVER UNDER THE CONTRACT IN QUESTION WERE COVERED BY SPECIFICATIONS AND COULD HAVE BEEN AWARDED EITHER TO AN INDIVIDUAL, A FIRM, OR A CORPORATION. IN OTHER WORDS, THERE WAS INVOLVED THE PERFORMANCE OF A PARTICULAR JOB UNDER CONTRACT ON A NONPERSONAL SERVICE BASIS.

THE ASSUMPTION THAT COMPETITION WAS IMPRACTICABLE IS NOT APPARENT, BUT, WITHOUT DECIDING THAT QUESTION, YOU ARE ADVISED THAT OTHERWISE PROPER PAYMENTS UNDER THE CONTRACT IN QUESTION ARE NOT SUBJECT TO REDUCTION UNDER THE ECONOMY ACT.