A-95983, JULY 6, 1938, 18 COMP. GEN. 19

A-95983: Jul 6, 1938

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WHERE THE WORK IS TO BE PERFORMED AT A KNOWN PLACE OR SITE. PAYMENT IS NOT AUTHORIZED UNDER A CONTRACT FOR THE OVERHAUL OF AN AIRPLANE WHERE THE CONTRACT FAILS TO INCLUDE THE REQUIREMENTS OF THE AMENDED DAVIS-BACON ACT AND THE EIGHT-HOUR LAW. AS FOLLOWS: REFERENCE IS MADE TO CONTRACT NUMBERED TCG-28268. THE ABOVE CONTRACT IS EXECUTED ON U.S. IT IS REQUESTED THAT INFORMATION BE FURNISHED AS TO WHY U.S. WAS NOT USED. AS ARTICLE 2B OF THE INVITATION FOR BIDS FILED WITH THE ABOVE CONTRACT STATES THAT THE AIRPLANE IS GROUNDED IN A DAMAGED CONDITION AT THE WACO AIRCRAFT COMPANY. IT WOULD APPEAR THAT THE SITUS OF THE WORK COULD HAVE BEEN DETERMINED WHEN THE SPECIFICATIONS WERE ADVERTISED. IT IS THEREFORE REQUESTED THAT AN EXPLANATION BE FURNISHED AS TO WHY SAID SPECIFICATIONS DID NOT INCLUDE THE PROVISIONS OF THE DAVIS-BACON ACT.

A-95983, JULY 6, 1938, 18 COMP. GEN. 19

CONTRACTS - REPAIR OF DAMAGED AIRCRAFT - APPLICABILITY OF EIGHT-HOUR LAW AND DAVIS-BACON WAGE STIPULATION PROVISIONS CONTRACTS FOR THE CONSTRUCTION, ALTERATION, OR REPAIR OF COAST GUARD AIRCRAFT, IN AMOUNTS IN EXCESS OF $2,000, BEING SUBJECT TO THE WAGE STIPULATION PROVISIONS OF THE AMENDED DAVIS-BACON ACT OF AUGUST 30, 1935, 49 STAT. 1011, WHERE THE WORK IS TO BE PERFORMED AT A KNOWN PLACE OR SITE, AND TO THE PROVISIONS OF THE EIGHT-HOUR LAW OF JUNE 19, 1912, 37 STAT. 137, AS WELL AS THE PAYMENT AND PERFORMANCE BOND PROVISIONS OF THE MILLER ACT OF AUGUST 24, 1935, 49 STAT. 793, PAYMENT IS NOT AUTHORIZED UNDER A CONTRACT FOR THE OVERHAUL OF AN AIRPLANE WHERE THE CONTRACT FAILS TO INCLUDE THE REQUIREMENTS OF THE AMENDED DAVIS-BACON ACT AND THE EIGHT-HOUR LAW, THE CHARACTER OF THE OVERHAUL, AND REPAIR AND THE GROUNDING OF THE PLANE AT THE PLACE OF A PLANE MANUFACTURER'S PLANT, BEING INDICATIVE OF THE ONLY PRACTICABLE SITE AT WHICH THE WORK COULD BE PERFORMED, AS CORROBORATED BY THE RECEIPT OF ONLY ONE BID AFTER WIDE SOLICITATION--- THE BID OF THE PLANE MANUFACTURER WITH PLANT LOCATED AT THE SITE OF THE PLANE GROUNDING.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF THE TREASURY, JULY 6, 1938:

UNDER DATE OF MAY 19, 1938, THE CHIEF, CONTRACT EXAMINING SECTION OF THIS OFFICE ADDRESSED THE COMMANDANT, UNITED STATES COAST GUARD, AS FOLLOWS:

REFERENCE IS MADE TO CONTRACT NUMBERED TCG-28268, ENTERED INTO MARCH 21, 1938, WITH THE WACO AIRCRAFT COMPANY, TROY, OHIO, COVERING THE OVERHAUL OF MODEL J2W-1 AIRPLANE V157, FOR THE SUM OF $4,621.07.

THE ABOVE CONTRACT IS EXECUTED ON U.S. STANDARD FORM NO. 32 (REVISED), WHICH FORM COVERS CONTRACTS FOR THE PROCUREMENT OF SUPPLIES AND MANUFACTURED ARTICLES. AS THIS CONTRACT WOULD APPEAR TO COVER CONSTRUCTION, ALTERATION, OR REPAIR OF A PUBLIC WORK, IT IS REQUESTED THAT INFORMATION BE FURNISHED AS TO WHY U.S. STANDARD FORM NO. 23, CONTRACT, CONSTRUCTION, WAS NOT USED.

AS ARTICLE 2B OF THE INVITATION FOR BIDS FILED WITH THE ABOVE CONTRACT STATES THAT THE AIRPLANE IS GROUNDED IN A DAMAGED CONDITION AT THE WACO AIRCRAFT COMPANY, TROY, OHIO, IT WOULD APPEAR THAT THE SITUS OF THE WORK COULD HAVE BEEN DETERMINED WHEN THE SPECIFICATIONS WERE ADVERTISED. IT IS THEREFORE REQUESTED THAT AN EXPLANATION BE FURNISHED AS TO WHY SAID SPECIFICATIONS DID NOT INCLUDE THE PROVISIONS OF THE DAVIS-BACON ACT, 49 STAT. 1011, WHICH REQUIRES THAT THE ADVERTISED SPECIFICATIONS FOR EVERY CONTRACT IN EXCESS OF $2,000 FOR THE CONSTRUCTION, ALTERATION, AND/OR REPAIR OF PUBLIC BUILDINGS OR PUBLIC WORKS OF THE UNITED STATES SHALL CONTAIN A PROVISION STATING THE MINIMUM WAGES TO BE PAID LABORERS AND MECHANICS EMPLOYED ON THE WORK.

IT IS NOTED THAT THE ABOVE CONTRACT DOES NOT INCORPORATE THE PROVISIONS OF THE EIGHT HOUR LAW, 37 STAT. 137, AND AN EXPLANATION IS THEREFORE REQUESTED AS TO THE OMISSION OF SAME.

IT IS REQUESTED THAT AN ABSTRACT OF ALL BIDS RECEIVED IN RESPONSE TO THE ABOVE INVITATION BE FURNISHED WITH YOUR REPLY.

THE REPLY FROM THE COMMANDANT DATED MAY 24, 1938, IS AS FOLLOWS:

REFERENCE IS MADE TO YOUR LETTER OF 19 MAY, 1938 (A-WWS-CE), CONCERNING CONTRACT TCG-28268, DATED 21 MARCH, 1938, IN THE SUM OF $4,621.07, WITH WACO AIRCRAFT COMPANY, TROY, OHIO, FOR THE OVERHAUL OF MODEL J2W-1 AIRPLANE V157.

THE PURCHASE OF AIRCRAFT BY THE COAST GUARD HAS BEEN CONSIDERED AS AN ITEM OF SUPPLY INASMUCH AS THE SITE OF THE CONTRACT CAN NOT BE DETERMINED UNTIL AWARD IS MADE AFTER COMPETITIVE BIDDING. FURTHER, THOUGH NEW AIRCRAFT ARE PURCHASED UNDER DEFINITE AND RIGID SPECIFICATIONS OF THIS OFFICE, AND THOUGH THEIR FABRICATION IS CONTINUOUSLY INSPECTED BY REPRESENTATIVES OF THE COAST GUARD, THE COAST GUARD HAS NO INTEREST IN THE AIRPLANES EXCEPT AS FINISHED PRODUCTS. INASMUCH AS THE PURCHASES HAVE BEEN CLASSED AS SUPPLIES, AND ARE CONTRACTED FOR ON STANDARD FORM NO. 32 (REVISED), THE CONTRACTS COME UNDER THE PURVIEW OF THE PUBLIC CONTRACTS ACT, PUBLIC NO. 846, 74TH CONGRESS. THE REPRESENTATIONS AND STIPULATIONS OF THIS ACT ARE CONTAINED IN ALL PROPOSALS COVERING THE PURCHASE OF AIRCRAFT.

IN VIEW OF THE ABOVE THIS OFFICE HAS HELD THAT, INASMUCH AS THE PURCHASE OF AIRCRAFT ARE ITEMS OF SUPPLY, IT NECESSARILY FOLLOWS THAT THE REPAIR OF SUCH AIRCRAFT ALSO BE CLASSIFIED AS ITEMS OF SUPPLY AND THAT CONTRACTS FOR SUCH REPAIR BE EXECUTED ON STANDARD FORM NO. 32 (REVISED). IT ALSO FOLLOWS THAT ANY CONTRACT ENTERED INTO FOR THE REPAIR OF AIRCRAFT WOULD BE SUBJECT TO THE PROVISIONS OF THE PUBLIC CONTRACTS ACT. IN THIS CONNECTION YOU ARE ADVISED THAT THE SECRETARY OF LABOR, ON 25 FEBRUARY, 1937, EXEMPTED THE USE OF THE PROVISIONS OF THE PUBLIC CONTRACTS ACT IN CONTRACTS FOR OVERHAUL AND REPAIR OF AIRCRAFT. (ACT JUNE 30, 1936, 49 STAT. 2036.)

THOUGH ARTICLE 2B OF THE INVITATION FOR BIDS FORMING PART OF THE ABOVE CONTRACT STATES THAT THE AIRPLANE IS GROUNDED IN A DAMAGED CONDITION AT THE WACO AIRCRAFT COMPANY, TROY, OHIO, THIS FACT WAS INSERTED FOR THE INFORMATION OF PROSPECTIVE BIDDERS SO THAT THEY MIGHT, SHOULD THEY SO DESIRE, INSPECT THE AIRPLANE PRIOR TO SUBMITTING THEIR BIDS. THE SITE OF THIS WORK COULD NOT BE DETERMINED AT THE TIME BIDS WERE SOLICITED. THE COAST GUARD HAS HAD NUMEROUS AIRCRAFT OVERHAULED BY PRIVATE FIRMS AS A RESULT OF COMPETITIVE BIDDING, AND HAS NEVER BEEN ABLE TO DETERMINE IN ADVANCE OF THE OPENING DATE OF THE BID AND THE CONSEQUENT STUDY OF BIDS SUBMITTED, WHERE THE AIRPLANE WOULD BE REPAIRED. HOWEVER, INASMUCH AS THE REPAIR OF AIRCRAFT HAS BEEN CLASSED AS AN ITEM OF SUPPLY, THIS OFFICE HOLDS THAT THE SPECIFICATIONS PROPERLY CANNOT INCLUDE THE PROVISIONS OF THE DAVIS BACON ACT, 49 STAT. 1011. CONTRACTS FOR SUPPLIES ARE COVERED BY THE MINIMUM WAGE PROVISIONS OF THE PUBLIC CONTRACTS ACT.

THE PROVISIONS OF THE EIGHT-HOUR LAW, 37 STAT. 137, WERE NOT INCORPORATED IN THE SPECIFICATIONS OF THE ABOVE CONTRACT IN VIEW OF THE FACT THAT SECTION 2 OF THAT ACT PROVIDES THAT IT SHALL NOT APPLY TO CONTRACTS FOR THE PURCHASE OF SUPPLIES BY THE GOVERNMENT.

YOU ARE ADVISED THAT PROPOSALS FOR REPAIR OF THE AIRPLANE CONCERNED WERE SOLICITED FROM UNITED AIRCRAFT CORPORATION, UNITED AIRPORTS DIVISION, EAST HARTFORD, CONNECTICUT; THE VIKING FLYING BOAT COMPANY, NEW HAVEN, CONNECTICUT; FLEETWINGS, INC., BRISTOL, PENNSYLVANIA; HALL ALUMINUM AIRCRAFT CORPORATION, BRISTOL, PENNSYLVANIA; AND WACO AIRCRAFT COMPANY, TROY, OHIO. ALL OF THESE FIRMS HAVE PREVIOUSLY BID UPON AND HAVE BEEN AWARDED CONTRACTS FOR THE REPAIR OF COAST GUARD AIRCRAFT. ONLY ONE BID WAS RECEIVED AS A RESULT OF THE INVITATION, THAT OF WACO AIRCRAFT COMPANY, IN THE SUM OF $4,621.07.

THE CONCLUSION IN THE COMMANDANT'S LETTER THAT REPAIR OF AIRCRAFT IS AN ITEM OF SUPPLY AS TO WHICH THE SPECIFICATIONS CANNOT INCLUDE THE PROVISIONS OF THE AMENDED DAVIS-BACON ACT OF AUGUST 30, 1935, 49 STAT. 1011, 40 U.S.C. 276A, IS DIRECTLY CONTRARY TO THE OPINION TO YOU OF THE ATTORNEY GENERAL DATED MARCH 6, 1936, 38 OP.ATTY.GEN. 418, 423, WHEREIN ACTING ATTORNEY GENERAL REED SAID "THAT CONTRACTS IN EXCESS OF $2,000 FOR ALTERATION OR REPAIR OF UNITED STATES COAST GUARD * * * AIRCRAFT, AND * * * CONTRACTS FOR CONSTRUCTION THEREOF * * * WHERE THE CONTRACT IS IN EXCESS OF $2,000, ARE SUBJECT TO THE PROVISIONS" OF THE AMENDED DAVIS-BACON ACT.

WHILE THE OPINION SUGGESTED AN EXCEPTION TO THIS RULE IF THE WORK UNDER THE CONTRACT IS TO BE PERFORMED AT A PARTICULAR PLACE OR SITE, THE LOCATION OF WHICH ACTUALLY IS UNKNOWN AT THE TIME OF ADVERTISEMENT, YOU WILL NOTE THAT IN THIS PARTICULAR INSTANCE THE PLANE TO BE REPAIRED WAS GROUNDED IN A DAMAGED CONDITION AT THE WACO AIRCRAFT CO. PLANT AT TROY, OHIO, AND THE CHARACTER OF OVERHAUL AND REPAIR COVERED BY THE SPECIFICATIONS AND THE FACT THAT ONLY ONE BID WAS RECEIVED, WHICH WAS FROM THAT PARTICULAR COMPANY, ARE MOST PERSUASIVE--- IN THE ABSENCE OF CLEAR EVIDENCE TO THE CONTRARY--- THAT THE TRANSACTION WAS UPON A BASIS THAT NO OTHER COMPANY WAS ABLE TO BID ON COMPETITIVE TERMS WITH THE WACO AIRCRAFT COMPANY, AND THAT THE ONLY PRACTICABLE SITE WHERE THE REPAIRS SPECIFIED COULD HAVE BEEN MADE WAS AT THE PLACE WHERE THE DAMAGED PLANE WAS GROUNDED.

THE CITED OPINION OF ACTING ATTORNEY GENERAL REED LIKEWISE CONCLUDED THAT THE MILLER ACT OF AUGUST 24, 1935, 49 STAT. 793, 40 U.S.C. 270A, B, C, AND D, AND THAT THE BITUMINOUS COAL CONSERVATION ACT OF 1935, 49 STAT. 991, ARE APPLICABLE TO SUCH REPAIR OF AIRCRAFT CONTRACTS AND THE APPLICATION OF THE MILLER ACT APPARENTLY HAS BEEN RECOGNIZED IN RESPECT OF THIS PARTICULAR CONTRACT IN THAT BOTH PAYMENT AND PERFORMANCE BONDS ARE FILED WITH THE CONTRACT.

THE CONCLUSION IN THE COMMANDANT'S LETTER THAT THE PROVISIONS OF THE EIGHT-HOUR LAW, ACT OF JUNE 19, 1912, 37 STAT. 137, 40 U.S.C. 324, 325, 326 (ALSO SEE 40 U.S.C. 321, 322), ARE NOT APPLICABLE TO A CONTRACT LIKE THIS FOR REPAIR OF AIRCRAFT IS NOT CORRECT. SEE CASES CITED 38 OP.ATTY.GEN. 422.

THE BENEFICENT PURPOSE OF THE STATUTES CITED MUST BE RECOGNIZED AND GIVEN A LIBERAL APPLICATION RATHER THAN FRUSTRATED THROUGH TECHNICALITIES. ACCORDINGLY, YOU WILL UNDERSTAND THAT THE AGREEMENT MADE WITH THE WACO AIRCRAFT COMPANY MAY NOT BE RECOGNIZED AS GIVING RISE TO ANY OBLIGATION PAYABLE UNDER APPROPRIATED MONEYS OF THE UNITED STATES UPON THE RECORD NOW APPEARING AND ACTION OF THIS OFFICE IN THE SETTLEMENT OF ACCOUNTS AND CLAIMS MUST BE UPON THAT BASIS AS TO THIS AND ANY OTHER AGREEMENTS MADE UPON THE AFORE STATED BASIS.