A-77913, JULY 17, 1936, 16 COMP. GEN. 37

A-77913: Jul 17, 1936

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" IS NOT AVAILABLE FOR THE PURCHASE OF EQUIPMENT UNDER A CONTRACT ENTERED INTO AFTER JUNE 30. NOTWITHSTANDING INVITATIONS WERE ISSUED AND BIDS WERE OPENED PRIOR THERETO. DELAY BEYOND JUNE 30 WAS INCIDENT TO ALLEGATION OF ERROR IN THE LOW BID. THERE IS SUBMITTED HEREWITH FOR YOUR CONSIDERATION. INFORMED US THAT THEY WERE NOT PREPARED TO FABRICATE STAINLESS STEEL AND THAT WE COULD PROCEED TO ADVERTISE OUR NEEDS WITHOUT THE FORMALITY OF CLEARANCE. OUR INVITATION FOR BIDS WAS SENT TO THIRTY ONE (31) FIRMS. WHEN THE BIDS WERE OPENED. IT WAS NOTED THAT THE LOWEST WAS ABOUT 25 PERCENT UNDER OUR ESTIMATE AND ABOUT 50 PERCENT UNDER THE NEXT LOW BID. THE LOW BIDDER WAS ASKED BY TELEPHONE TO CONFIRM HIS BID.

A-77913, JULY 17, 1936, 16 COMP. GEN. 37

APPROPRIATIONS - AVAILABILITY BEYOND FISCAL YEAR - NATIONAL ARCHIVES THE APPROPRIATION "SALARIES AND EXPENSES, NATIONAL ARCHIVES, 1936," IS NOT AVAILABLE FOR THE PURCHASE OF EQUIPMENT UNDER A CONTRACT ENTERED INTO AFTER JUNE 30, 1936, NOTWITHSTANDING INVITATIONS WERE ISSUED AND BIDS WERE OPENED PRIOR THERETO, AND DELAY BEYOND JUNE 30 WAS INCIDENT TO ALLEGATION OF ERROR IN THE LOW BID.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE EXECUTIVE OFFICER, THE NATIONAL ARCHIVES, JULY 17, 1936:

THERE HAS BEEN RECEIVED YOUR LETTER OF JUNE 29, 1936, AS FOLLOWS:

IN ACCORDANCE WITH A DECISION OF YOUR OFFICE, DATED AUGUST 10, 1931 (A- 37899), THERE IS SUBMITTED HEREWITH FOR YOUR CONSIDERATION, A LETTER FROM THE GLOBE-WERNICKE CO., DATED JUNE 26, 1936, REQUESTING PERMISSION TO WITHDRAW THE ATTACHED BID FOR ONE LOT OF STAINLESS STEEL RACKS AND TRAYS. WE ALSO ENCLOSE A COPY OF THE INVITATION FOR BIDS AND AN ABSTRACT OF ALL BIDS RECEIVED.

PRIOR TO ADVERTISING, THE AGENT OF FEDERAL PRISON INDUSTRIES, INC., INFORMED US THAT THEY WERE NOT PREPARED TO FABRICATE STAINLESS STEEL AND THAT WE COULD PROCEED TO ADVERTISE OUR NEEDS WITHOUT THE FORMALITY OF CLEARANCE. ACCORDINGLY, OUR INVITATION FOR BIDS WAS SENT TO THIRTY ONE (31) FIRMS, FIFTEEN OF WHICH RESPONDED WITH BIDS RANGING IN AMOUNT FROM $711.25 TO $4,457.10.

WHEN THE BIDS WERE OPENED, IT WAS NOTED THAT THE LOWEST WAS ABOUT 25 PERCENT UNDER OUR ESTIMATE AND ABOUT 50 PERCENT UNDER THE NEXT LOW BID. IN VIEW OF THIS DISPARITY AND BECAUSE WE WISHED TO MAKE THE AWARD DURING THE CURRENT FISCAL YEAR, THE LOW BIDDER WAS ASKED BY TELEPHONE TO CONFIRM HIS BID. THE ENCLOSED LETTER IS THE REPLY TO THAT REQUEST.

WE SUBSEQUENTLY ASKED THE NEXT LOW BIDDER FOR AN EXTENSION OF TIME FOR THE ACCEPTANCE OF HIS BID AND OUR REQUEST HAS BEEN GRANTED.

YOUR DECISION IS RESPECTFULLY REQUESTED (1) AS TO WHETHER THE BID SUBMITTED BY THE GLOBE-WERNICKE COMPANY MAY BE WITHDRAWN AND THE AWARD MADE TO THE NEXT LOW BIDDER, AND (2) AS TO WHETHER, UNDER THE CIRCUMSTANCES, PAYMENT ON A CONTRACT LET ON THE BASIS OF THIS ADVERTISING WOULD BE CHARGEABLE TO APPROPRIATION 06718,"SALARIES AND EXPENSES, NATIONAL ARCHIVES, 1936.'

THE RETURN OF THE BID IN QUESTION IS REQUESTED, IF IT IS FOR ACCEPTANCE.

IT APPEARS THAT UPON BEING ASKED TO VERIFY ITS BID THE LOW BIDDER ADVISED THAT A MISTAKE HAD BEEN MADE IN THE SUBMISSION THEREOF AND THAT THE CORRECT PRICE WAS $1,470.75 INSTEAD OF $711.25 AND IN EXPLANATION OF THE MISTAKE THE SAID BIDDER STATED IN LETTER OF JUNE 26, 1936, THAT:

THIS MISTAKE WAS MADE BY THE ESTIMATING DEPARTMENT AT OUR FACTORY, WHO IN FIGURING THE COST OF THE METAL REQUIRED POINTED OFF INCORRECTLY AND THE RESULT WAS THAT WE FIGURED THE METAL AT FIVE CENTS A POUND INSTEAD OF FIFTY CENTS A POUND. THIS MISTAKE CAUSED OUR PRICE TO BE WAY UNDER THE CORRECT FIGURE. THE ESTIMATOR FULLY REALIZED THAT THE ALLEGHENY STEEL WAS REQUIRED; IN FACT, HE OBTAINED SPECIAL PRICES FOR THIS JOB, BUT AS MENTIONED ABOVE IN POINTING OFF HE GOT THE DECIMAL POINT IN THE WRONG PLACE.

WHILE THERE HAS BEEN SUBMITTED NO WORK SHEET OR OTHER EVIDENCE WHICH WOULD AUTHORIZE OR JUSTIFY REFORMATION OF THE BID OF THE GLOBE WERNICKE COMPANY SO AS TO PROVIDE FOR THE PRICE OF $1,470.75 ALLEGED TO HAVE BEEN INTENDED, THE FACTS ARE SUCH THAT THERE APPEARS NO DOUBT THAT THE BID OF $711.25 AS SUBMITTED WAS NOT THE BID INTENDED BY THE BIDDER. ALSO, THE BID ALLEGED TO HAVE BEEN INTENDED IS HIGHER THAN ONE OF THE OTHER BIDS RECEIVED. ACCORDINGLY, THE BID OF THE GLOBE WERNICKE COMPANY MAY BE DISREGARDED IN MAKING THE AWARD.

WITH REFERENCE TO YOUR QUESTION AS TO WHETHER PAYMENT ON A CONTRACT LET ON THE BASIS OF THIS ADVERTISING WOULD BE CHARGEABLE TO THE APPROPRIATION "SALARIES AND EXPENSES, NATIONAL ARCHIVES, 1936," SECTION 3690, REVISED STATUTES, PROVIDES:

ALL BALANCES OF APPROPRIATIONS CONTAINED IN THE ANNUAL APPROPRIATION BILLS AND MADE SPECIFICALLY FOR THE SERVICE OF ANY FISCAL YEAR, AND REMAINING UNEXPENDED AT THE EXPIRATION OF SUCH FISCAL YEAR, SHALL ONLY BE APPLIED TO THE PAYMENT OF EXPENSES PROPERLY INCURRED DURING THAT YEAR, OR TO THE FULFILLMENT OF CONTRACTS PROPERLY MADE WITHIN THAT YEAR; AND BALANCES NOT NEEDED FOR SUCH PURPOSES SHALL BE CARRIED TO THE SURPLUS FUND. THIS SECTION, HOWEVER, SHALL NOT APPLY TO APPROPRIATIONS KNOWN AS PERMANENT OR INDEFINITE APPROPRIATIONS.

THE GENERAL RULE RELATIVE TO OBLIGATING FISCAL YEAR APPROPRIATIONS BY CONTRACTS IS THAT THE CONTRACT MUST BE MADE WITHIN THE FISCAL YEAR THE APPROPRIATION FOR WHICH IS SOUGHT TO BE CHARGED, THAT THE SIGNING OF THE CONTRACT MUST BE WITHIN THE FISCAL YEAR, AND THAT THE SUBJECT MATTER MUST CONCERN A NEED ARISING WITHIN THAT FISCAL YEAR. 2 COMP. DEC. 249; 27 ID. 970; 1 COMP. GEN. 232; A-66066, OCTOBER 10, 1935. IN THIS CASE,ALTHOUGH THE INVITATION WAS ISSUED AND BIDS WERE OPENED IN JUNE 1936, THERE WAS NO VALID AGREEMENT ENTERED INTO DURING THE FISCAL YEAR 1936, FOR THE PURCHASE OF THE EQUIPMENT IN QUESTION, EVEN IF IT COULD BE ESTABLISHED THAT A NEED THEREFOR ACTUALLY EXISTED DURING THAT FISCAL YEAR. THEREFORE, ANSWERING YOUR SECOND QUESTION SPECIFICALLY, I HAVE TO ADVISE THAT PAYMENT UNDER ANY CONTRACT ENTERED INTO AFTER JUNE 30, 1936, ON THE BASIS OF THIS ADVERTISING MAY NOT BE MADE UNDER THE APPROPRIATION "SALARIES AND EXPENSES, NATIONAL ARCHIVES, 1936.'