A-75099, SEPTEMBER 11, 1936, 16 COMP. GEN. 225

A-75099: Sep 11, 1936

Additional Materials:

Contact:

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

 

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

CONTRACTS - GENERAL SUPPLY SCHEDULE ARTICLES - PURCHASES ELSEWHERE - RETURN OF SURETY BONDS AFTER CONTRACT COMPLETION CREDIT MAY NOT BE ALLOWED FOR PAYMENTS MADE UNDER CONTRACTS INVOLVING THE PURCHASE ELSEWHERE OF OFFICE FURNITURE OF THE CLASS AND GENERAL CHARACTER AS CONTRACTED FOR UNDER THE GENERAL SCHEDULE OF SUPPLIES WHERE NEITHER THE NEED FOR FURNITURE OF SLIGHTLY DIFFERENT DIMENSIONS NOR THE NECESSITY OF EMERGENCY PURCHASE IS SHOWN. WHERE SEPARATE INVITATIONS TO BID WERE ISSUED AND SEPARATE AWARDS MADE IN CONNECTION WITH STEEL TABLES ALLEGEDLY ONLY BECAUSE OF TWO TYPES BEING INVOLVED AND BECAUSE OF THE USE FOR SEPARATE PURPOSES. BONDS FURNISHED AS SECURITY FOR FAITHFUL PERFORMANCE ARE NOT FOR RETURN TO SURETY COMPANIES AFTER COMPLETION OF THE CONTRACT BUT ARE FOR FILING IN THE GENERAL ACCOUNTING OFFICE WITH THE CONTRACT AS REQUIRED BY LAW.

A-75099, SEPTEMBER 11, 1936, 16 COMP. GEN. 225

CONTRACTS - GENERAL SUPPLY SCHEDULE ARTICLES - PURCHASES ELSEWHERE - RETURN OF SURETY BONDS AFTER CONTRACT COMPLETION CREDIT MAY NOT BE ALLOWED FOR PAYMENTS MADE UNDER CONTRACTS INVOLVING THE PURCHASE ELSEWHERE OF OFFICE FURNITURE OF THE CLASS AND GENERAL CHARACTER AS CONTRACTED FOR UNDER THE GENERAL SCHEDULE OF SUPPLIES WHERE NEITHER THE NEED FOR FURNITURE OF SLIGHTLY DIFFERENT DIMENSIONS NOR THE NECESSITY OF EMERGENCY PURCHASE IS SHOWN, AND WHERE SEPARATE INVITATIONS TO BID WERE ISSUED AND SEPARATE AWARDS MADE IN CONNECTION WITH STEEL TABLES ALLEGEDLY ONLY BECAUSE OF TWO TYPES BEING INVOLVED AND BECAUSE OF THE USE FOR SEPARATE PURPOSES. BONDS FURNISHED AS SECURITY FOR FAITHFUL PERFORMANCE ARE NOT FOR RETURN TO SURETY COMPANIES AFTER COMPLETION OF THE CONTRACT BUT ARE FOR FILING IN THE GENERAL ACCOUNTING OFFICE WITH THE CONTRACT AS REQUIRED BY LAW.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF THE TREASURY, SEPTEMBER 11, 1936:

THERE ARE FOR CONSIDERATION BEFORE THIS OFFICE THE FOLLOWING DESCRIBED CONTRACTS COVERING THE FURNISHING OF OFFICE EQUIPMENT FOR THE WORKS PROGRESS ADMINISTRATION, NEW YORK CITY:

(A) ER-TPS-21-5890, C. W. DANES COMPANY, NEW YORK, N.Y. THIS CONTRACT PROVIDES FOR THE FURNISHING AT "WORKS PROGRESS ADMINISTRATION PIER 73, FT. W. 33RD ST. N.Y.C., " OF 400 "STEEL TABLES, OLIVE GREEN, 42 INCHES LONG, 24 INCHES DEEP, AND 26 1/2 INCHES HIGH--- SIMILAR TO SECURITY STEEL CO. NO. SS42 BUT WITH CLOSED BACK. WITH ONE DRAWER AT RIGHT 11 3/4 INCHES WIDE, 17 3/8 INCHES DEEP, 4 3/4 INCHES HIGH. DRAWER DIMENSIONS ARE INSIDE MEASUREMENTS.' PRICE $8.25 EACH.

(B) ER-TPS-21-6055, METAL OFFICE FURNITURE COMPANY, NEW YORK, N.Y. THIS CONTRACT PROVIDES FOR THE FURNISHING AT "WORKS PROGRESS ADMINISTRATION PIER 73 N.R., FT. W. 33RD ST. N.Y.C., " OF 300 ,STEEL TABLES, OLIVE GREEN, 42 INCHES LONG, 24 INCHES DEEP, AND 30 INCHES HIGH, SIMILAR TO SECURITY STEEL CO. NO. SS42 BUT WITH CLOSED BACK. WITH ONE DRAWER AT THE RIGHT 11 3/4 INCHES WIDE, 17 3/8 INCHES DEEP, 4 3/4 INCHES HIGH, AND ONE DRAWER AT LEFT 24 7/8 INCHES WIDE, 17 3/8 INCHES DEEP, 2 INCHES HIGH. ALL DRAWER DIMENSIONS ARE INSIDE MEASUREMENTS.' PRICE EACH $9.50.

(C) ER-TPS-21-6065, ART METAL CONSTRUCTION CO., NEW YORK, N.Y. THIS CONTRACT PROVIDES FOR THE FURNISHING AT "WORKS PROGRESS ADMINISTRATION PIER 73, FT. OF W. 33RD ST. N.Y.C., " OF 60 ,COMPTOMETER TABLES, STEEL, OLIVE GREEN FINISH, SIMILAR TO ART METAL CONSTRUCTION NO. 1245-CE.' PRICE $28 EACH.

(D) ER-TPS-21-6097, REMINGTON RAND, INC., NEW YORK, N.Y. THIS CONTRACT PROVIDES FOR THE FURNISHING AT "AREA STATISTICAL OFFICE NO. 1641, WASHINGTON ST. N.Y.C. (F.R.LUM)," OF 60 "FILING CABINETS--- INVOICE SIZE-- - 5-DRAWER, OLIVE GREEN FINISH. INSIDE WIDTH OF DRAWER EXACTLY 9 1/4 INCHES, INSIDE HEIGHT OF DRAWER EXACTLY 7 INCHES, FILING SPACE IN DRAWER 26 1/4 INCHES CLEAR WITH STEEL FOLLOWER.' PRICE $30.05 EACH.

WITH RESPECT TO THE FOREGOING CONTRACTS THIS OFFICE, IN LETTER DATED FEBRUARY 25, 1936, REQUESTED INFORMATION AS FOLLOWS:

IT IS NOTED THAT THE ABOVE CONTRACTS COVER THE PURCHASE OF STEEL TABLES AND FILING CABINETS, AND IN VIEW OF THE FACT THAT SIMILAR ARTICLES APPEAR ON THE GENERAL SCHEDULE OF SUPPLIES, PROCUREMENT DIVISION, AND ARE REQUIRED TO BE PURCHASED THEREUNDER, INFORMATION IS REQUESTED AS TO WHY THE ARTICLES WERE NOT PROCURED FROM THE CONTRACTOR OR CONTRACTORS UNDER THE SCHEDULE.

IT IS ALSO NOTED IN CONNECTION WITH CONTRACTS NUMBERED ER TPS-21 5890 AND ER TPS-21-6055, THAT FOR EACH CONTRACT THE INVITATIONS FOR BIDS WERE SOLICITED ON OCTOBER 11, 1935, FOR OPENING ON OCTOBER 16, 1935, FOR 400 AND 300 STEEL TABLES, RESPECTIVELY, AND THAT AWARD WAS MADE IN ITS ENTIRETY TO SEPARATE CONTRACTORS. INFORMATION IS REQUESTED AS TO WHY THE INVITATIONS FOR BIDS DID NOT DISCLOSE THE NEEDS OF THE GOVERNMENT TO THE EXTENT OF 700 STEEL TABLES AND AWARD MADE TO THE LOWEST BIDDER.

THE NUMBER OF DEALERS TO WHOM CIRCULAR LETTERS WERE SENT IS NOT SHOWN ON STANDARD FORM 1036, STATEMENT AND CERTIFICATE OF AWARD, SUPPORTING CONTRACT NUMBERED ER TPS-21-5890, AND THIS INFORMATION IS REQUESTED.

IN CONNECTION WITH CONTRACT NUMBERED ER TPS-21-6097, IT IS NOTED THAT THE INVITATIONS FOR BIDS WERE SOLICITED ON OCTOBER 19, 1935, THE OPENING DATE FOR BIDS WAS OCTOBER 21, 1935, AND THE CONTRACT WAS AWARDED ON OCTOBER 22, 1935, AND IT IS REQUESTED THAT INFORMATION BE FURNISHED AS TO WHY THE NEEDS OF THE GOVERNMENT WERE NOT ANTICIPATED TO PERMIT A LONGER TIME TO ELAPSE BETWEEN THE DATE OF ADVERTISING FOR BIDS AND THE DATE THE BIDS WERE OPENED. INFORMATION IS ALSO REQUESTED AS TO THE LENGTH OF TIME THE NOTICES WERE POSTED IN PUBLIC PLACES.

THE SPECIFICATIONS OF CONTRACTS NUMBERED ER TPS-21-5890, ER TPS-21 6055, AND ER TPS-21-6097 PROVIDE THAT THE SUCCESSFUL BIDDER WILL BE REQUIRED TO FURNISH SECURITY TO GUARANTEE FAITHFUL EXECUTION OF THE CONTRACT IN THE AMOUNT OF 25 PERCENT OF THE TOTAL CONTRACT, AND IT IS REQUESTED THAT INFORMATION BE FURNISHED SHOWING IN WHAT FORM SECURITY WAS FURNISHED IN EACH INSTANCE. IF PERFORMANCE BONDS WERE FURNISHED THEY SHOULD BE FORWARDED TO THIS OFFICE FOR FILING WITH EACH OF THE RESPECTIVE CONTRACTS.

IN LETTER OF MARCH 6, 1936, COPY OF WHICH WAS FURNISHED UNDER DATE OF MARCH 12, 1936, BY THE PROCUREMENT DIVISION OF YOUR DEPARTMENT, THE STATE PROCUREMENT OFFICER, NEW YORK CITY, STATED:

THE STEEL TABLES CALLED FOR IN CONTRACTS ER TPS 21-5890 AND ER TPS 21- 6055 WERE OF A SPECIAL SIZE AND CONSTRUCTION NOT CARRIED ON THE GENERAL SCHEDULE OF SUPPLIES. THE REQUIREMENTS OF THE PROJECT WERE FOR A TABLE OF MINIMUM SIZE FOR CONSERVATION OF SPACE. TWO TYPES OF TABLES WERE SPECIFIED. CONTRACT ER TPS 21-5890 WAS ISSUED FOR A TABLE- - TYPEWRITER HIGH (26 1/2 INCH) EQUIPPED WITH ONE DRAWER, AND ER TPS 21-6055 FOR ONE 30 INCH HIGH AND EQUIPPED WITH TWO DRAWERS, EACH TABLE TO BE USED FOR A SEPARATE PURPOSE. IT WAS, THEREFORE, OBVIOUSLY IMPOSSIBLE TO COMBINE BOTH QUANTITIES IN ONE BID.

THE NUMBER OF DEALERS TO WHOM FORMAL BIDS WERE SENT, AND WHICH INFORMATION SHOULD HAVE BEEN INCLUDED ON STANDARD FORM 1036 IN SUPPORT OF CONTRACT ER TPS 21-5890, IS 13.

CONTRACT ER TPS 21-6097 WAS ASSIGNED TO A FILE OF SPECIAL DIMENSIONS, IT BEING SPECIFICALLY REPRESENTED BY THE REQUISITIONING OFFICER THAT THEY WERE TO ACCOMMODATE A SPECIAL GOVERNMENTAL FORM OF THOSE DIMENSIONS. THE SIZE OF FILE REQUIRED DID NOT APPEAR IN THE SCHEDULE. INVITATIONS FOR BIDS WERE SOLICITED ON OCTOBER 19, 1935, THE OPENING DATE 4:00 P.M. OCTOBER 21, 1935, NOTICES BEING POSTED IN A PUBLIC PLACE FOR THREE (3) DAYS. THE URGENT NEED FOR THESE FILES DID NOT ALLOW OF A LONGER PERIOD OF TIME FOR ADVERTISING.

IN REFERENCE TO CONTRACT ER TPS 21-6065, IT WAS NOT KNOWN AT THE TIME OF PURCHASE THAT COMPTOMETER TABLES REFERRED TO IN THIS CONTRACT WERE INCLUDED IN THE GENERAL SCHEDULE OF SUPPLIES (CLASS 26), THIS SCHEDULE NOT HAVING BEEN RECEIVED THIS OFFICE AT THIS TIME.

PERFORMANCE BONDS WERE FURNISHED AS SECURITY FOR FAITHFUL PERFORMANCE IN SUPPORT OF CONTRACTS ER TPS 21-5890, 6055, AND 6097. THESE WERE RETURNED TO THE SURETY COMPANY UPON COMPLETION OF THE CONTRACTS.

AN EXAMINATION OF THE GENERAL SCHEDULE OF SUPPLIES, DISCLOSES THAT THERE WERE CONTRACTED FOR AND SCHEDULED UNDER CLASS 26, FURNITURE, OLIVE GREEN STEEL TABLES, OLIVE GREEN STEEL FILING CABINETS, INVOICE SIZE, AND OLIVE GREEN STEEL COMPTOMETER TABLES OF SUCH CLASS AND GENERAL CHARACTER AS THOSE OF THE OFFICE FURNITURE AND EQUIPMENT COVERED BY THE INVOLVED CONTRACTS.

IT HAS LONG BEEN HELD BY THE ACCOUNTING OFFICERS OF THE GOVERNMENT THAT SUCH ARTICLES OF EQUIPMENT MAY NOT OTHERWISE BE CONTRACTED FOR EXCEPT IN CASE OF AN EXIGENCY REQUIRING SUCH IMMEDIATE DELIVERY AS COULD NOT BE EFFECTED BY PURCHASES FROM THE SCHEDULED CONTRACTOR. 18 COMP. DEC. 642, ID. 765, ID. 900; 19 ID. 617; 5 COMP. GEN. 755; 14 ID. 837; 15 ID. 949. THE CONTRACTING FOR AND SCHEDULING BY YOU OF THE OFFICE FURNITURE AND EQUIPMENT UNDER CLASS 26 OF THE GENERAL SCHEDULE OF SUPPLIES WAS IN ACCORDANCE WITH THE REQUIREMENT OF SECTION 4 OF THE ACT OF JUNE 17, 1910, 36 STAT. 531, WHICH WAS ENACTED FOR THE PURPOSE OF STANDARDIZING EQUIPMENT, SUPPLIES, ETC., SUCH AS HERE INVOLVED, AND ELIMINATING UNNECESSARY GRADES, SIZES, ETC. THE REQUIREMENTS OF THIS STATUTE ARE CLEAR AND UNAMBIGUOUS AND ANY CONTRACTING FOR SUPPLIES SUCH AS ESTABLISHED BY THE RECORD HERE APPEARS IN DEROGATION OF THE STATUTE. THE NEEDS FOR OFFICE FURNITURE AND EQUIPMENT CANNOT BE LEFT TO THE WHIM OF THE PARTICULAR DEPARTMENT OR AGENCY DESIRING PARTICULAR EQUIPMENT. IN VIEW OF THE LONG LINE OF DECISIONS OF THIS OFFICE IN THE MATTER, AS WELL AS THE CLEAR DIRECTION IN THE LAW, IT IS NOT UNDERSTOOD WHY CONTRACTS OF THE CLASS IN QUESTION HERE ARE BEING MADE THROUGH THE PROCUREMENT DIVISION OF YOUR DEPARTMENT. IN 18 COMP. DEC. 900, IT WAS HELD THAT---

WHERE A GOVERNMENT DEPARTMENT OR ESTABLISHMENT PURCHASES IN THE OPEN MARKET AND USES ARTICLES SCHEDULED BY THE GENERAL SUPPLY COMMITTEE AND THERE IS NO EXIGENCY EXISTING AT THE TIME OF THE PURCHASE, SUCH PURCHASE IS IN VIOLATION OF THE ACT OF JUNE 17, 1910 (36 STAT. 468), WHICH PROVIDES THE MODE OF MAKING SUCH PURCHASES, AND PRIVATE DEALERS NO LESS THAN PUBLIC OFFICIALS MUST BE PRESUMED TO HAVE KNOWLEDGE THEREOF, AND TRANSACTIONS IN VIOLATION THEREOF CAN NOT CLAIM FAVOR AS HAVING BEEN MADE IN GOOD FAITH.

THE INFORMATION FURNISHED BY THE STATE PROCUREMENT OFFICE, SUPRA, CONSTITUTES NO PROPER SHOWING THAT THE OFFICE FURNITURE AND EQUIPMENT CONTRACTED FOR AND SCHEDULED ON THE GENERAL SCHEDULE OF SUPPLIES WOULD NOT SATISFACTORILY MEET THE NEEDS OF THE WORKS PROGRESS ADMINISTRATION. NEITHER HAS THERE BEEN ESTABLISHED ANY EXIGENCY REQUIRING SUCH IMMEDIATE DELIVERY AS COULD NOT BE EFFECTED BY PURCHASES FROM THE SCHEDULED CONTRACTS WITHIN THE MEANING OF THE CITED DECISIONS.

ON THE BASIS OF THE PRESENT RECORD, THEREFORE, IT MUST BE HELD THAT THE CONTRACTS IN QUESTION WERE ENTERED INTO WITHOUT AUTHORITY OF LAW, AND THE CONTRACTORS, AS WELL AS THE GOVERNMENT OFFICERS INVOLVED, BEING CHARGEABLE WITH KNOWLEDGE OF THE PUBLIC LAW (SEC. 4 OF THE ACT OF JUNE 17, 1910, 36 STAT. 531) REQUIRING PURCHASES OF OFFICE FURNITURE OF THE CLASS HERE INVOLVED TO BE MADE FROM THE GENERAL SCHEDULE OF SUPPLIES, NO CREDIT MAY BE ALLOWED FOR ANY PAYMENT MADE UNDER SUCH CONTRACTS.

ASIDE FROM THE QUESTION HEREIN RAISED, THE REASON STATED BY THE STATE PROCUREMENT OFFICER FOR NOT COMBINING IN ONE INVITATION FOR BIDS THE TWO TYPES OF STEEL TABLES COVERED BY CONTRACTS NOS. 5890 AND 6055 IS WITHOUT MERIT. WHETHER THE TABLES WERE TO BE USED FOR SEPARATE PURPOSES AFFORDS NO BASIS FOR SEPARATE INVITATIONS FOR BIDS. IN THE EVENT OF A DEALER HANDLING BOTH CLASSES OF TABLES, IT SEEMS PROBABLE THAT A MORE ADVANTAGEOUS BID MIGHT BE OBTAINED ON EACH CLASS OF TABLE THROUGH COMBINING BOTH TYPES OF TABLES IN ONE INVITATION--- IT BEING A MATTER OF COMMON KNOWLEDGE THAT QUANTITY ORDERS ARE CONDUCIVE TO LOWER PRICES.

ALSO, THE RETURNING OF THE PERFORMANCE BONDS TO THE SURETY COMPANY AFTER COMPLETION OF CONTRACTS WAS UNAUTHORIZED. THESE DOCUMENTS CONSTITUTE AN ESSENTIAL PART OF THE CONTRACTS AND, IRRESPECTIVE OF THE VALIDITY OF THE CONTRACTS, ARE FOR FILING IN THIS OFFICE WITH THE CONTRACT AS REQUIRED BY LAW. ACTION SHOULD BE ACCORDINGLY.