B-103315(5), SEP 17, 1971

B-103315(5): Sep 17, 1971

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AT THE KENNEDY SPACE CENTER IS SELLING AIRLINE TICKETS TO ANYONE WHO HAPPENS TO BE AT THE SPACE CENTER AND EXPRESS THE VIEW THAT SUCH PRACTICE IS IN VIOLATION OF GENERAL ACCOUNTING OFFICE MANUAL. THERE IS NOTHING IN THE REGULATIONS THAT PERMITS THE OPERATION AND SALE OF TRANSPORTATION TICKETS FOR OTHER THAN THOSE TRAVELING ON GOVERNMENT TRAVEL ORDERS. WILL BE USED IN PROCUREMENT OF PASSENGER TRANSPORTATION SERVICES FOR THE ACCOUNT OF THE UNITED STATES. WHICH IS A NONGOVERNMENTAL ORGANIZATION OPERATED JOINTLY BY SEVERAL AIRLINES. AT THE KENNEDY SPACE CENTER WAS ESTABLISHED PURSUANT TO AN AGREEMENT ENTERED INTO WITH THE AIR TRAFFIC CONFERENCE OF AMERICA. WE ARE ADVISED THAT THE PURPOSE OF THE CONTRACTUAL ARRANGEMENT IS TO PROVIDE A DIRECT TICKETING ACTIVITY WITHIN THE KENNEDY SPACE CENTER.

B-103315(5), SEP 17, 1971

COMMERCIAL AIRLINES - TICKET SALES AT GOVERNMENT INSTALLATIONS REGARDING THE SALE OF AIRLINE PASSENGER TICKETS BY THE SCHEDULED AIRLINES TRAFFIC OFFICE (SATO) AT THE JOHN F. KENNEDY SPACE CENTER. THE ARRANGEMENTS AT THE SPACE CENTER DO NOT APPEAR TO VIOLATE TITLE 5 OF THE GAO POLICY AND PROCEDURES MANUAL FOR THE GUIDANCE OF FEDERAL AGENCIES. ALSO, NEITHER GAO REGULATIONS, NOR ANY OTHER LAW OR REGULATION, PRECLUDES SATO FROM SELLING TRANSPORTATION TO OTHERS FOR CASH OR CREDIT, WITH NO GOVERNMENT TRANSPORTATION REQUESTS BEING USED. CONSIDERING THE BENEFITS TO THE GOVERNMENT IN CONVENIENCE AND ECONOMY, AND THE AUTHORITY VESTED IN NASA BY 42 U.S.C. 2473, GAO WOULD NOT BE WARRANTED IN OBJECTING TO THE METHOD NOW EMPLOYED IN HANDLING THESE TICKET SALES.

TO ALL WORLD TRAVEL AGENCY:

WE REFER TO YOUR LETTERS OF MAY 27, JULY 24, AUGUST 3 AND AUGUST 18, 1971, PERTAINING TO THE PROCUREMENT OF AIRLINE PASSENGER TICKETS FROM THE SCHEDULED AIRLINES TRAFFIC OFFICE (S.A.T.O.) AT THE JOHN F. KENNEDY SPACE CENTER, NATIONAL AERONAUTICS AND SPACE ADMINISTRATION (NASA), KENNEDY SPACE CENTER, FLORIDA. YOU STATE THAT THE S.A.T.O. AT THE KENNEDY SPACE CENTER IS SELLING AIRLINE TICKETS TO ANYONE WHO HAPPENS TO BE AT THE SPACE CENTER AND EXPRESS THE VIEW THAT SUCH PRACTICE IS IN VIOLATION OF GENERAL ACCOUNTING OFFICE MANUAL, TITLE 5, TRANSPORTATION 2013. YOU FURTHER CONTEND THAT REGARDLESS OF ANY ARRANGEMENTS MADE WITH THE AIR TRAFFIC CONFERENCE OF AMERICA, THERE IS NOTHING IN THE REGULATIONS THAT PERMITS THE OPERATION AND SALE OF TRANSPORTATION TICKETS FOR OTHER THAN THOSE TRAVELING ON GOVERNMENT TRAVEL ORDERS. YOU ALSO CONTEND THAT THE SALE OF AIR TRANSPORTATION BY S.A.T.O. TO OTHERS THAN THOSE TRAVELING ON GOVERNMENT BUSINESS CONSTITUTES UNFAIR COMPETITION WHICH SHOULD BE ELIMINATED.

SECTION 2013.10, TITLE 5, OF GENERAL ACCOUNTING OFFICE POLICY AND PROCEDURES MANUAL FOR GUIDANCE OF FEDERAL AGENCIES, WITH CERTAIN EXCEPTIONS NOT HERE APPLICABLE, DIRECTS THAT OFFICIAL GOVERNMENT PASSENGER TRANSPORTATION SERVICES SHOULD BE PROCURED FROM CARRIERS AND THAT TRAVEL AGENCIES SHOULD NOT BE UTILIZED. SECTION 2016.10, TITLE 5, PRESCRIBES THAT STANDARD FORM 1169, GOVERNMENT TRANSPORTATION REQUEST, WILL BE USED IN PROCUREMENT OF PASSENGER TRANSPORTATION SERVICES FOR THE ACCOUNT OF THE UNITED STATES. SECTION 2020.10, TITLE 5, PROVIDES THAT THE TRANSPORTATION REQUESTS SHALL NOT BE USED FOR OTHER THAN OFFICIALLY AUTHORIZED TRAVEL FOR THE ACCOUNT OF THE UNITED STATES GOVERNMENT. THE REGULATIONS THUS GENERALLY REQUIRE THAT GOVERNMENT TRANSPORTATION REQUESTS BE USED IN CONNECTION WITH THE PROCUREMENT OF TRANSPORTATION FOR OFFICIAL GOVERNMENT TRAVEL AND NO OTHER TRAVEL, BUT DO NOT PURPORT TO CONTAIN ANY PROVISIONS RELATING TO THE SERVICES TO BE FURNISHED BY THE S.A.T.O. WHICH IS A NONGOVERNMENTAL ORGANIZATION OPERATED JOINTLY BY SEVERAL AIRLINES.

THE S.A.T.O. AT THE KENNEDY SPACE CENTER WAS ESTABLISHED PURSUANT TO AN AGREEMENT ENTERED INTO WITH THE AIR TRAFFIC CONFERENCE OF AMERICA. WE ARE ADVISED THAT THE PURPOSE OF THE CONTRACTUAL ARRANGEMENT IS TO PROVIDE A DIRECT TICKETING ACTIVITY WITHIN THE KENNEDY SPACE CENTER.

UNDER THE AGREEMENT THE GOVERNMENT OBLIGATES ITSELF TO FURNISH WITHOUT CHARGE THE OFFICE SPACE AND OFFICE FACILITIES NECESSARY FOR THE AIRLINE PERSONNEL WHO OPERATE AND MANAGE THE OFFICE. THE AIR CARRIERS THEREUNDER PAY THE SALARIES OF THE OFFICE PERSONNEL AND ABSORB THE COSTS OF TELEPHONE SERVICE, TICKET STOCK, TARIFFS, SUPPLIES, AND OTHER OPERATING EXPENSES OF THE OFFICE.

THE OPERATION IS REPORTED TO BE MUTUALLY BENEFICIAL TO BOTH PARTIES TO THE AGREEMENT. THE GOVERNMENT HAS READY ACCESS TO FLIGHT RESERVATIONS, CANCELLATIONS OF FLIGHTS, RESCHEDULING OF FLIGHTS, AND PAYS FOR THE OFFICIAL GOVERNMENT TRANSPORTATION OBTAINED THROUGH USE OF GOVERNMENT TRANSPORTATION REQUESTS. WE ARE ADVISED THAT WITHOUT A S.A.T.O. AT THE KENNEDY SPACE CENTER, THE GOVERNMENT WOULD BE REQUIRED TO HIRE TWO ADDITIONAL TRAVEL EMPLOYEES AT A COST APPROXIMATING $14,000 PER ANNUM AND TO OBTAIN AIRLINE TICKETS EITHER THROUGH USE OF TELETICKETING MACHINES LINKED TO EACH OF THE ORIGINATING CARRIERS SERVING THE AREA OR BY USE OF TELEPHONIC COMMUNICATIONS WHICH WOULD REQUIRE EXCHANGE OF THE GOVERNMENT TRANSPORTATION REQUESTS AT THE AIR TERMINAL PRIOR TO BOARDING THE PLANES FOR FLIGHT. EITHER ALTERNATIVE REPORTEDLY WOULD BE FAR LESS CONVENIENT, REQUIRE ADDITIONAL EMPLOYEE TIME, AND BE LESS ECONOMICAL TO THE GOVERNMENT.

THE OPERATION OF THE S.A.T.O. IS UNDERSTOOD TO BE BENEFICIAL TO THE AIR TRAFFIC CONFERENCE OF AMERICA, WHICH REPRESENTS THE AIR CARRIERS, AS LONG AS THE TICKET SALES GROSS $100,000 PER MONTH AND THE EXPENSES OF OPERATING THE TICKET OFFICE DO NOT EXCEED 5 PERCENT OF THE SALES. WE ARE ADVISED THAT APPROXIMATELY 75 PERCENT OF THE GROSS REVENUES OF THE S.A.T.O. AT KENNEDY SPACE CENTER RESULT FROM THE SALE OF TRANSPORTATION FOR OFFICIAL BUSINESS THROUGH USE OF GOVERNMENT TRANSPORTATION REQUESTS. THE OTHER 25 PERCENT, WHICH COULD BE CONSIDERED PERSONAL OR UNOFFICIAL TRAVEL, INCLUDES PROCUREMENT OF TRANSPORTATION FOR TRAVEL OF FAMILY MEMBERS ACCOMPANYING PERSONNEL ON OFFICIAL TRAVEL, CONTRACT PERSONNEL AND OTHERS HAVING ACCESS TO THE KENNEDY SPACE CENTER WHICH IS UNDERSTOOD TO BE RESTRICTED TO PERSONS ADMITTED BY THE NASA SECURITY OFFICE. NO GOVERNMENT TRAVEL REQUESTS ARE USED IN CONNECTION WITH PROCUREMENT OF TRANSPORTATION FOR SUCH PERSONAL OR UNOFFICIAL TRAVEL. THE ELIMINATION OF ANY SUBSTANTIAL PART OF THE GROSS TICKET SALES COULD REDUCE THE GROSS TICKET SALES AND RESULT IN THE CLOSING OF THE S.A.T.O. OFFICE, WHICH WOULD DESTROY THE BENEFITS NOW ACCRUING TO THE GOVERNMENT UNDER THE S.A.T.O. ARRANGEMENT.

THE ARRANGEMENTS AT THE SPACE CENTER DO NOT APPEAR TO VIOLATE TITLE 5 OF THE GENERAL ACCOUNTING OFFICE POLICY AND PROCEDURES MANUAL FOR THE GUIDANCE OF FEDERAL AGENCIES, IN THAT UNDER SUCH ARRANGEMENTS OFFICIAL GOVERNMENT AIR TRANSPORTATION IS PROCURED FROM THE S.A.T.O., THE CARRIER'S JOINT TRAVEL OFFICE, AND ONLY THROUGH THE USE OF GOVERNMENT TRANSPORTATION REQUESTS. ALSO, NEITHER OUR REGULATIONS NOR ANY OTHER LAW OR REGULATION WHICH HAS COME TO OUR ATTENTION PRECLUDES THE S.A.T.O., WHICH AS INDICATED ABOVE IS A NONGOVERNMENTAL ORGANIZATION OPERATED JOINTLY BY SEVERAL AIRLINES, FROM SELLING TRANSPORTATION TO OTHERS FOR CASH OR CREDIT, NO GOVERNMENT TRANSPORTATION REQUESTS BEING USED. ACCORDINGLY, AND CONSIDERING THE BENEFITS IN CONVENIENCE AND ECONOMY TO THE GOVERNMENT FROM THE S.A.T.O. OFFICE AT THE KENNEDY SPACE CENTER, AND THE AUTHORITY VESTED IN NASA BY 42 U.S.C. 2473, IT IS OUR VIEW THAT WE WOULD NOT BE WARRANTED IN OBJECTING TO THE METHOD NOW EMPLOYED IN HANDLING TICKET SALES AT THE S.A.T.O. AT THE KENNEDY SPACE CENTER. AS TO ELIMINATING COMPETITION, IT IS UNDERSTOOD BOTH CARRIERS AND TRAVEL AGENTS REGULARLY SELL AIR TRANSPORTATION TO THEIR CLIENTS AND THUS COMPETE FOR SUCH BUSINESS.

THERE IS ATTACHED, FOR YOUR INFORMATION, A COPY OF OUR LETTER OF OCTOBER 17, 1966, B-103315, TO THE CHAIRMAN, SELECT COMMITTEE ON SMALL BUSINESS, HOUSE OF REPRESENTATIVES, CONCERNING THE RESTRICTION ON USE OF TRAVEL AGENCIES IN THE PROCUREMENT OF OFFICIAL GOVERNMENT PASSENGER TRANSPORTATION SERVICES.