A-74553, MAY 23, 1936, 15 COMP. GEN. 1023

A-74553: May 23, 1936

Additional Materials:

Contact:

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

 

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

ADVERTISING - BIDDERS - PRIOR APPROVAL BY ADMINISTRATIVE OFFICE THERE IS NO STATUTORY AUTHORITY FOR THE INCLUSION IN ADVERTISED SPECIFICATIONS FOR OVERHAUL OF AIRCRAFT ENGINES FOR THE BUREAU OF AIR COMMERCE. OF A PROVISION LIMITING COMPETITION TO BIDDERS WHO HAVE PREVIOUSLY RECEIVED THE APPROVAL OF THAT BUREAU. THERE IS PROPOSED TO BE INSERTED IN ALL ADVERTISEMENTS FOR BIDS FOR SUCH WORK. - ONLY THE BIDS OF THE ORIGINAL MANUFACTURER OF THE ENGINE OR REPAIR STATIONS APPROVED BY THE BUREAU OF AIR COMMERCE FOR ENGINE REPAIRS AND OVERHAUL AND WHICH HAVE AMPLE EQUIPMENT AND EXPERIENCE FOR THE PURPOSE WILL BE CONSIDERED.'. WAS MADE EFFECTIVE JANUARY 1. PROVISION IS MADE THEREIN FOR THE SUBMITTAL OF DOCUMENTARY EVIDENCE AND INFORMATION AS TO REPAIRS.

A-74553, MAY 23, 1936, 15 COMP. GEN. 1023

ADVERTISING - BIDDERS - PRIOR APPROVAL BY ADMINISTRATIVE OFFICE THERE IS NO STATUTORY AUTHORITY FOR THE INCLUSION IN ADVERTISED SPECIFICATIONS FOR OVERHAUL OF AIRCRAFT ENGINES FOR THE BUREAU OF AIR COMMERCE, OF A PROVISION LIMITING COMPETITION TO BIDDERS WHO HAVE PREVIOUSLY RECEIVED THE APPROVAL OF THAT BUREAU.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF COMMERCE, MAY 23, 1936:

THERE HAS BEEN RECEIVED YOUR LETTER OF APRIL 27, 1936, AS FOLLOWS:

IN CONNECTION WITH THE OVERHAUL OF AIRCRAFT ENGINES FOR THE BUREAU OF AIR COMMERCE, THERE IS PROPOSED TO BE INSERTED IN ALL ADVERTISEMENTS FOR BIDS FOR SUCH WORK, A PROVISION READING AS FOLLOWS:

"QUALIFICATIONS OF BIDDERS.--- ONLY THE BIDS OF THE ORIGINAL MANUFACTURER OF THE ENGINE OR REPAIR STATIONS APPROVED BY THE BUREAU OF AIR COMMERCE FOR ENGINE REPAIRS AND OVERHAUL AND WHICH HAVE AMPLE EQUIPMENT AND EXPERIENCE FOR THE PURPOSE WILL BE CONSIDERED.'

PURSUANT TO THE AIR COMMERCE ACT OF 1926, AS AMENDED, THE BUREAU OF AIR COMMERCE HAS ISSUED AMENDED AERONAUTICS BULLETIN NO. 7-H GOVERNING THE ALTERATION AND REPAIR OF AIRCRAFT. THIS BULLETIN, APPROVED BY THE SECRETARY OF COMMERCE DECEMBER 23, 1935, WAS MADE EFFECTIVE JANUARY 1, 1936. THESE REGULATIONS DEAL WITH THE ALTERATION AND REPAIR OF STRUCTURAL COMPONENTS OF AIRCRAFT RATED AS AIRWORTHY, THE ALTERATION AND OVERHAUL OF APPROVED ENGINES, THE ALTERATION, REPAIR, AND OVERHAUL OF APPROVED PROPELLERS, AND THE REPAIR OF INSTRUMENTS USED IN AIRCRAFT RATED AS AIRWORTHY. PROVISION IS MADE THEREIN FOR THE SUBMITTAL OF DOCUMENTARY EVIDENCE AND INFORMATION AS TO REPAIRS, FOR THE SUBMITTAL OF TECHNICAL DATA REGARDING ALTERATIONS, FOR THE INSPECTION OF ALTERATIONS AND MAJOR REPAIRS TO AIRPLANE STRUCTURES, AND FOR THE APPROVAL BY THE SECRETARY OF COMMERCE OF REPAIR STATIONS BY SPECIFIC CLASSIFICATIONS. THIS BULLETIN ALSO DEALS WITH THE REQUIRED TECHNIQUE AND PRACTICES IN MAKING REPAIRS, ALTERATIONS, OR OVERHAULS, AND PROVIDES FOR SPECIFIED EQUIPMENT, FACILITIES, AND SUPPLIES FOR APPROVED REPAIR STATIONS, ACCORDING TO THE CLASS OF WORK DONE. THE PREVIOUS BULLETIN SPECIFIED THE EQUIPMENT FOR APPROVED STATIONS FOR AIRCRAFT WORK OTHER THAN FOR THE OVERHAUL OF AIRCRAFT ENGINES. THE BULLETIN AS NOW AMENDED ALSO COVERS EQUIPMENT FOR APPROVED STATIONS FOR ENGINE OVERHAUL WORK.

AT THE PRESENT TIME THERE IS BEING INCLUDED IN ALL SPECIFICATIONS FOR AIRPLANE ENGINE OVERHAULS, THE FOLLOWING PROVISION:

"QUALIFICATIONS OF BIDDER.--- ONLY THE BIDS OF THE ORIGINAL MANUFACTURER OF THE ENGINE OR OF REPAIR STATIONS WHICH HAVE AMPLE EQUIPMENT AND EXPERIENCE FOR THE PURPOSE WILL BE CONSIDERED.'

IT WILL BE SEEN THAT THE PROPOSED PROVISION PROVIDES FOR THE PRIOR APPROVAL OF THE STATION BY THE BUREAU OF AIR COMMERCE IN ADDITION TO HAVING AMPLE EQUIPMENT AND EXPERIENCE BEFORE BIDS WILL BE CONSIDERED. THE PROVISION NOW IN USE MERELY REQUIRES THE STATIONS TO HAVE AMPLE EQUIPMENT AND EXPERIENCE.

BEARING IN MIND THAT THE REGULATIONS ABOVE REFERRED TO WERE PROMULGATED TO COVER THE WHOLE INDUSTRY, YOUR OPINION IS RESPECTFULLY REQUESTED AS TO WHETHER THIS BUREAU MAY REQUIRE, BEFORE A BID IS CONSIDERED, THE APPROVAL OF A STATION BY THE BUREAU'S OWN REPRESENTATIVE IN ACCORDANCE WITH THE REVISED BULLETIN 7-H.

THE PURPOSES AND PROVISIONS OF SECTION 3709, REVISED STATUTES, REQUIRE THAT SPECIFICATIONS BE SO DRAWN THAT THERE MAY BE FREE AND OPEN COMPETITION AMONG QUALIFIED PERSONS AND CONCERNS WHO DESIRE TO BID FOR GOVERNMENT BUSINESS. THE INCLUSION IN SPECIFICATIONS OF THE PROVISION SUGGESTED BY YOU WOULD RESULT IN MAKING APPROVAL BY THE BUREAU OF AIR COMMERCE PRIOR TO THE SUBMISSION OF BIDS A CONDITION PRECEDENT TO THE RIGHT OF A CITIZEN TO MAKE A PROPOSAL FOR ENGINE REPAIRS AND OVERHAUL ON AIRPLANES, NO MATTER HOW AMPLE MAY BE THE EQUIPMENT AND HOW BROAD THE EXPERIENCE AND ABILITY OF THE BIDDER TO PERFORM THE SERVICE REQUIRED. IS, OF COURSE, THE DUTY OF THE ADMINISTRATIVE DEPARTMENT OR INDEPENDENT AGENCY INVOLVED TO INVESTIGATE THE RESPONSIBILITY AND ABILITY OF A LOW BIDDER BEFORE AWARD OF A CONTRACT, AND IF THE FACTS JUSTIFY DETERMINATION THAT, OWING TO LACK OF ABILITY, EXPERIENCE, FACILITIES, OR FINANCIAL RESOURCES OR BACKING, SUCH LOW BIDDER IS NOT COMPETENT TO PERFORM THE WORK INVOLVED, THE UNITED STATES IS NOT REQUIRED TO ACCEPT THE LOWEST BID RECEIVED. HOWEVER, THERE APPEARS NO STATUTORY AUTHORITY FOR LIMITING COMPETITION TO BIDDERS WHO HAVE PREVIOUSLY RECEIVED THE APPROVAL OF THE BUREAU OF AIR COMMERCE IN ANY OR ALL OF THESE RESPECTS (8 COMP. GEN. 252; A-34151, DEC. 19, 1930; 14 COMP. GEN. 305).

THE PROVISION WHICH YOU STATE IS NOW INCLUDED IN SPECIFICATIONS FOR WORK OF THIS CHARACTER WOULD APPEAR TO AFFORD SUFFICIENT PROTECTION AGAINST IRRESPONSIBLE OR UNQUALIFIED BIDDERS, FOR IT PROVIDES THAT ONLY "REPAIR STATIONS WHICH HAVE AMPLE EQUIPMENT AND EXPERIENCE FOR THE PURPOSE WILL BE CONSIDERED.' IF, UPON PROPER INVESTIGATION AFTER BIDS ARE OPENED, THE FACTS SHOW A LOW BIDDER TO BE LACKING IN EQUIPMENT AND/OR EXPERIENCE, ACCEPTANCE OF ITS BID WOULD NOT BE IMPERATIVE. IT MAY BE SAID, HOWEVER, THAT THE PROVISION AS IT NOW STANDS MAY NOT BE INVOKED AS AUTHORITY FOR REJECTION OF THE LOW BID MERELY UPON ADMINISTRATIVE CONCLUSION THAT THE BIDDER IS LACKING IN EQUIPMENT OR EXPERIENCE, AND WHERE AN OTHERWISE ACCEPTABLE LOW BID IS REJECTED ON THAT GROUND, THE FACTS PRESENTED SHOULD BE SUFFICIENT TO JUSTIFY ANY EXCESS EXPENDITURE OF GOVERNMENT MONEYS. 34151, DECEMBER 19, 1930.

I HAVE TO ADVISE THAT THE AMENDMENT OF THE CLAUSE INVOLVED AS SUGGESTED BY YOU WOULD BE IN CONTRAVENTION OF STATUTORY REQUIREMENTS AND MAY NOT BE APPROVED.