A-63431, NOVEMBER 6, 1935, 15 COMP. GEN. 374

A-63431: Nov 6, 1935

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

THE REDUCTION IN BID PRICE BECAUSE OF ELIMINATION OF CODE COMPLIANCE IS "SUBJECT TO THE APPROVAL OF THE COMPTROLLER GENERAL. " AND THE PRICE REDUCTION AGREEMENT SHOULD BE REACHED BEFORE ENTERING INTO CONTRACT RATHER THAN RESERVED FOR DETERMINATION AFTER THE CONTRACT IS PERFORMED. AS FOLLOWS: REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 9. AS YOU WERE ADVISED BY MY LETTER OF JULY 15. BIDS FOR THIS WORK WERE REJECTED IN VIEW OF THE FACT THAT THEY WERE BASED UPON COMPLIANCE WITH THE NATIONAL INDUSTRIAL RECOVERY ACT. THE WORK WAS NOT READVERTISED. THE BID WAS ACCEPTED IN ACCORDANCE WITH THE PROVISIONS OF SAID RESOLUTION. THERE IS INCLOSED HEREWITH COPY OF THE LETTER OF THE DIRECTOR OF PROCUREMENT.

A-63431, NOVEMBER 6, 1935, 15 COMP. GEN. 374

CONTRACTS - AWARDS - BID PRICE REDUCTION BECAUSE OF CODE COMPLIANCE ELIMINATION UNDER THE TERMS OF PUBLIC RESOLUTION NO. 65, APPROVED AUGUST 29, 1935, 49 STAT. 990, THE REDUCTION IN BID PRICE BECAUSE OF ELIMINATION OF CODE COMPLIANCE IS "SUBJECT TO THE APPROVAL OF THE COMPTROLLER GENERAL," AND THE PRICE REDUCTION AGREEMENT SHOULD BE REACHED BEFORE ENTERING INTO CONTRACT RATHER THAN RESERVED FOR DETERMINATION AFTER THE CONTRACT IS PERFORMED, BUT IF IN FACT ADJUSTMENT HAS BEEN RESERVED UNTIL AFTER PERFORMANCE, FINAL PAYMENT VOUCHER UNDER THE CONTRACT IN AN AMOUNT ADEQUATE TO PROTECT THE PUBLIC INTERESTS SHOULD BE FORWARDED TO THE GENERAL ACCOUNTING OFFICE FOR DIRECT SETTLEMENT.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE TREASURY, NOVEMBER 6, 1935:

THERE HAS BEEN RECEIVED IN RESPONSE TO MY REQUEST OF OCTOBER 9, 1935, A REPORT DATED OCTOBER 24, AS FOLLOWS:

REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 9, 1935 (A-63431), WITH RESPECT TO THE AWARD OF THE CONTRACT FOR THE MAIL-HANDLING EQUIPMENT FOR THE ST. LOUIS, MISSOURI, POST OFFICE.

AS YOU WERE ADVISED BY MY LETTER OF JULY 15, 1935, BIDS FOR THIS WORK WERE REJECTED IN VIEW OF THE FACT THAT THEY WERE BASED UPON COMPLIANCE WITH THE NATIONAL INDUSTRIAL RECOVERY ACT. HOWEVER, IN VIEW OF THE INTRODUCTION IN THE CONGRESS OF A JOINT RESOLUTION (S.J.RES. 163), TO PERMIT OF THE ACCEPTANCE OF SUCH BIDS, THE WORK WAS NOT READVERTISED; AND WHEN THE JOINT RESOLUTION BECAME LAW (PUBLIC RESOLUTION NO. 65, 74TH CONGRESS), THE BID WAS ACCEPTED IN ACCORDANCE WITH THE PROVISIONS OF SAID RESOLUTION.

THERE IS INCLOSED HEREWITH COPY OF THE LETTER OF THE DIRECTOR OF PROCUREMENT, DATED SEPTEMBER 6, 1935, ACCEPTING THE PROPOSAL OF THE ALVEY FERGUSON COMPANY, INC., UPON WHICH APPEARS A NOTATION INDICATING THE LATTER'S ASSENT TO THE CONDITIONS THEREIN SET FORTH. THERE IS ALSO INCLOSED HEREWITH THE ORIGINAL CONTRACT. AS WILL BE NOTED, THE LETTER OF ACCEPTANCE AND CONTRACT ARE IN ACCORDANCE WITH THE PROVISIONS OF PUBLIC RESOLUTION NO. 65.

THE REDUCTION IN PRICE BECAUSE OF ELIMINATION OF CODE COMPLIANCE IS "SUBJECT TO THE APPROVAL OF THE COMPTROLLER GENERAL" UNDER THE TERMS OF PUBLIC RESOLUTION NO. 65, APPROVED AUGUST 29, 1935, 49 STAT. 990, AND THE AGREEMENT AS TO THE REDUCTION IN PRICE SHOULD HAVE BEEN REACHED BEFORE THE CONTRACT TIPW-2539, DATED SEPTEMBER 6, 1935, WAS ENTERED INTO WITH THE ALVEY-FERGUSON CO., INC., IN THE SUM OF $321,153 FOR THE PERFORMANCE OF THE WORK AND NOT RESERVED, AS WAS DONE, FOR DETERMINATION AFTER THE CONTRACT WAS PERFORMED.

THE FINAL PAYMENT VOUCHER UNDER THIS CONTRACT IN AN AMOUNT ADEQUATE TO PROTECT THE PUBLIC INTERESTS SHOULD NOT BE PAID BY A DISBURSING OFFICER, BUT SHOULD BE FORWARDED TO THIS OFFICE FOR DIRECT SETTLEMENT, WITH A DETAILED SHOWING OF THE FACTS AS TO COST INCLUDED BY THE ALVEY FERGUSON CO., INC., IN ITS BID BY REASON OF CODE COMPLIANCE, IN ACCORDANCE WITH EXECUTIVE ORDER NO. 6646 OF MARCH 14, 1934, AND THE REDUCTION WHICH SHOULD BE MADE FROM THE CONTRACT PRICE BY REASON OF SUCH COMPLIANCE BEING ELIMINATED.