A-60594, MAY 27, 1935, 14 COMP. GEN. 854

A-60594: May 27, 1935

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PURCHASES - ENVELOPES - OPEN MARKET ALL DEPARTMENTS AND ESTABLISHMENTS OF THE GOVERNMENT ARE REQUIRED TO PROCURE ENVELOPES UNDER CONTRACTS MADE BY THE POSTMASTER GENERAL UNDER THE PROVISIONS OF THE ACT OF JUNE 26. IF ENVELOPES OF A DIFFERENT QUALITY ARE DESIRED BY THE DEPARTMENT AND ARE NOT INCLUDED IN THE AWARD OF POST OFFICE CONTRACTS FOR ENVELOPES. THE NEEDS OF THE DEPARTMENT OR ESTABLISHMENT ARE REQUIRED TO BE SUBMITTED TO THE POSTMASTER GENERAL THAT HE MAY PROCURE PRICES FOR SUCH ENVELOPES. 1935: REFERENCE IS MADE TO CONTRACT NUMBERED FH-77. THAT IS. WAS ACCEPTED UNDER DATE OF JANUARY 12. IT APPEARS DELIVERY OF THE ENVELOPES WAS COMPLETED ON FEBRUARY 13. ARE INCLUDED UNDER ITEM 49 IN THE AWARD OF THE POST OFFICE CONTRACTS FOR ENVELOPES FOR THE FISCAL YEAR 1935 AT $2.45 PER THOUSAND.

A-60594, MAY 27, 1935, 14 COMP. GEN. 854

PURCHASES - ENVELOPES - OPEN MARKET ALL DEPARTMENTS AND ESTABLISHMENTS OF THE GOVERNMENT ARE REQUIRED TO PROCURE ENVELOPES UNDER CONTRACTS MADE BY THE POSTMASTER GENERAL UNDER THE PROVISIONS OF THE ACT OF JUNE 26, 1906, 34 STAT. 476 (TITLE 39 UNITED STATES CODE), AND IF ENVELOPES OF A DIFFERENT QUALITY ARE DESIRED BY THE DEPARTMENT AND ARE NOT INCLUDED IN THE AWARD OF POST OFFICE CONTRACTS FOR ENVELOPES, THE NEEDS OF THE DEPARTMENT OR ESTABLISHMENT ARE REQUIRED TO BE SUBMITTED TO THE POSTMASTER GENERAL THAT HE MAY PROCURE PRICES FOR SUCH ENVELOPES.

COMPTROLLER GENERAL MCCARL TO THE ADMINISTRATOR, FEDERAL HOUSING ADMINISTRATION, MAY 27, 1935:

REFERENCE IS MADE TO CONTRACT NUMBERED FH-77, DATED JANUARY 12, 1935, WITH THE UNION ENVELOPE CO., COVERING THE PURCHASE OF ENVELOPES IN THE OPEN MARKET INSTEAD OF OBTAINING THEM THROUGH THE POSTMASTER GENERAL.

IT APPEARS THAT UNDER DATE OF JANUARY 7, 1935, THE FEDERAL HOUSING ADMINISTRATION REQUESTED BIDS FROM FOUR MANUFACTURERS FOR FURNISHING 1,500,000 KRAFT ENVELOPES, OPEN SIDE, GUMMED FLAPS, SIZE 6 1/2 BY 9 1/2, PRINTED CARD AND PENALTY CLAUSE, IN THREE WEIGHTS OF STOCK, THAT IS, 20- 24- AND 32-POUND. THE BID OF THE UNION ENVELOPE CO. FOR FURNISHING ENVELOPES OF 20-POUND SUBSTANCE KRAFT, THE LOWEST RECEIVED, WAS ACCEPTED UNDER DATE OF JANUARY 12, 1935, AND IT APPEARS DELIVERY OF THE ENVELOPES WAS COMPLETED ON FEBRUARY 13, 1935.

THE ACT OF JANUARY 12, 1895, 28 STAT. 264, AS AMENDED BY THE ACT OF JUNE 26, 1906, 34 STAT. 476, PROVIDES:

* * * THE POSTMASTER GENERAL SHALL CONTRACT, FOR A PERIOD NOT EXCEEDING FOUR YEARS, FOR ALL ENVELOPES, STAMPED OR OTHERWISE, DESIGNED FOR SALE TO THE PUBLIC, OR FOR USE BY THE POST OFFICE DEPARTMENT, THE POSTAL SERVICE, AND OTHER EXECUTIVE DEPARTMENTS, AND ALL GOVERNMENT BUREAUS AND ESTABLISHMENTS, AND THE BRANCHES OF THE SERVICE COMING UNDER THEIR JURISDICTION, AND MAY CONTRACT FOR THEM TO BE PLAIN OR WITH SUCH PRINTED MATTER AS MAY BE PRESCRIBED BY THE DEPARTMENT MAKING REQUISITION THEREFOR. * * *

ENVELOPES ANSWERING THE DESCRIPTION IN THE REQUEST FOR BIDS, BUT MANUFACTURED OF 32-POUND KRAFT SUBSTANCE, ARE INCLUDED UNDER ITEM 49 IN THE AWARD OF THE POST OFFICE CONTRACTS FOR ENVELOPES FOR THE FISCAL YEAR 1935 AT $2.45 PER THOUSAND. THE AWARD OF CONTRACTS FOR ENVELOPES BEARS A NOTATION IN BOLD-FACED TYPE THAT---

AFTER JULY 1, 1934, REQUISITIONING OFFICERS WILL BE LIMITED TO THE ITEMS LISTED IN THIS SCHEDULE. IF ANY DEPARTMENT OR ESTABLISHMENT DESIRES ENVELOPES NOT LISTED IN THIS SCHEDULE, IT SHOULD SUBMIT ITS REQUEST TO THE PURCHASING AGENT, POST OFFICE DEPARTMENT, TO PROCURE PRICES FOR SUCH ENVELOPES IN THE OPEN MARKET.

IN REPLY TO A REQUEST FOR AN EXPLANATION WHY THE ENVELOPES WERE NOT CONTRACTED FOR THROUGH THE POST OFFICE DEPARTMENT, IT WAS STATED IN YOUR LETTER OF FEBRUARY 4, 1935, AS FOLLOWS:

IN REFERENCE TO YOUR LETTER OF JANUARY 28, 1935 A-JSB-CC RELATIVE TO CONTRACT NUMBERED FH 77, DATED JANUARY 12, 1935, WITH THE UNION ENVELOPE COMPANY OF RICHMOND, VIRGINIA, COVERING THE PURCHASE OF ENVELOPES, YOU ARE ADVISED THAT TWENTY POUND 6 1/2 INCHES BY 9 1/2 INCHES KRAFT ENVELOPES COULD NOT BE SUPPLIED BY THE POST OFFICE DEPARTMENT IN TIME TO MEET THE NEEDS OF THE ADMINISTRATION.

WHILE THIRTY-TWO POUND ENVELOPES COULD HAVE BEEN SECURED FROM THE POST OFFICE DEPARTMENT AT A PRICE OF $2.45 PER THOUSAND, IT WAS ADMINISTRATIVELY DETERMINED THAT A LIGHTER WEIGHT ENVELOPE COULD BE USED FOR THE PARTICULAR MAILING FOR WHICH THE ENVELOPES CALLED FOR IN THE CONTRACT WERE TO BE USED AND COMPETITION WAS SECURED FROM THE VARIOUS CONTRACTORS WHO MAKE ENVELOPES FOR THE POST OFFICE DEPARTMENT WHICH RESULTED IN A TWENTY POUND ENVELOPE AT A COST OF $1.85 PER THOUSAND, RESULTING IN A NET SAVING TO THE ADMINISTRATION OF $900.00.

IT IS NOT APPARENT--- NOR HAS IT BEEN EXPLAINED--- WHY THE POST OFFICE DEPARTMENT COULD NOT HAVE OBTAINED THE ENVELOPES PURCHASED IN THIS INSTANCE AS EXPEDITIOUSLY AS, AND PROBABLY MORE ECONOMICALLY THAN, YOU OBTAINED THEM. BUT BE THAT AS IT MAY, THE PROVISIONS OF THE ACT OF JUNE 26, 1906, 34 STAT. 476 (TITLE 39, U.S. CODE), AUTHORIZING THE POSTMASTER GENERAL TO ENTER INTO CONTRACTS FOR FURNISHING ALL ENVELOPES REQUIRED BY THE DEPARTMENTS AND ESTABLISHMENTS OF THE GOVERNMENT ARE MANDATORY, AND THE PURCHASE OF SUCH ENVELOPES OTHERWISE THAN AS PROVIDED THEREIN IS DIRECT CONTRAVENTION OF THE LAW. SEE IN THIS CONNECTION CONSOLIDATED SUPPLY CO. V. UNITED STATES, 59 CT.CLS. 197. SEE, ALSO, DECISION OF MAY 5, 1927, A-15999. ACCORDINGLY, SINCE THE PURCHASE WAS NOT MADE, AUTHORIZED, OR APPROVED BY THE POSTMASTER GENERAL, PAYMENT ON THE VOUCHER IS NOT AUTHORIZED. THE VOUCHER WILL BE RETAINED IN THE FILES OF THIS OFFICE.