B-118952, MAR 7, 1955

B-118952: Mar 7, 1955

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REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 16. YOU ARE ADVISED THAT THE PROPOSED METHOD OF LIQUIDATING THE DEBT IS ACCEPTABLE WITH THE EXCEPTION HEREAFTER MENTIONED. NO INTEREST IS CHARGEABLE AGAINST THE CONTRACTOR'S ACCOUNT. AS WAS INDICATED TO YOU AT THE TIME OF YOUR VISIT HERE. A PLAN OF COLLECTION SUCH AS HERE INVOLVED IS ACCEPTABLE IN CIRCUMSTANCES WHERE. THE GOVERNMENT'S POSITION IS MADE SECURE. IT HAS BEEN INFORMALLY ASCERTAINED THAT THE EARNINGS UNDER THE ARMY CONTRACT HAVE BEEN AVERAGING ABOUT $4. THAT IT IS EXPECTED THAT THE EARNINGS UNDER THE AIR FORCE CONTRACT WILL BE $10. THESE CONTRACTS WILL EXPIRE ON JUNE 30. WE UNDERSTAND THAT THEY WILL BE READVERTISED. WILL BECOME DUE SUBSEQUENT TO THE TERMINATION OF THOSE CONTRACTS AND AFTER THE PAYMENTS THEREUNDER NORMALLY WOULD BE COMPLETED.

B-118952, MAR 7, 1955

PRECIS-UNAVAILABLE

CLAUDE M. JOHNS, JR.,

REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 16, 1955, REGARDING THE INDEBTEDNESS TO THE UNITED STATES OF N. F. SHAW, INC., IN THE SUM OF $30,685.95, REPRESENTING OVERPAYMENTS MADE TO YOUR CLIENT BY THE DEPARTMENT OF THE INTERIOR, ALASKA NATIVE SERVICE, UNDER CONTRACT NO. 14- 20-300-80. YOU STATE THAT A SEVERE FINANCIAL BURDEN WOULD BE PLACED UPON THE CONTRACTOR IF IT BE REQUIRED TO LIQUIDATE THE INDEBTEDNESS IN A LUMP- SUM PAYMENT, AND, THEREFORE, YOU REQUEST THAT YOUR CLIENT BE PERMITTED TO SETTLE ITS OBLIGATION BY PERIODIC MONTHLY PAYMENTS OF $5,685.95, BETWEEN APRIL 1 AND 10, 1955; $5,000 EACH MONTH BETWEEN THE 1ST AND 10TH DAY OF MAY, JUNE AND JULY; AND A FINAL PAYMENT OF 10,000 BETWEEN AUGUST 1 AND 10, 1955.

YOU ARE ADVISED THAT THE PROPOSED METHOD OF LIQUIDATING THE DEBT IS ACCEPTABLE WITH THE EXCEPTION HEREAFTER MENTIONED. IN VIEW OF THE NATURE OF THIS OBLIGATION, NO INTEREST IS CHARGEABLE AGAINST THE CONTRACTOR'S ACCOUNT.

AS WAS INDICATED TO YOU AT THE TIME OF YOUR VISIT HERE, A PLAN OF COLLECTION SUCH AS HERE INVOLVED IS ACCEPTABLE IN CIRCUMSTANCES WHERE, BY REASON OF MONEYS BECOMING DUE A DEBTOR UNDER OTHER GOVERNMENT CONTRACTS, THE GOVERNMENT'S POSITION IS MADE SECURE. WITH RESPECT TO THE TWO CURRENT FISCAL YEAR CONTRACTS OF N. F. SHAW, INC., WITH THE DEPARTMENT OF THE ARMY AT FORT RICHARDSON, ALASKA, AND WITH THE DEPARTMENT OF THE AIR FORCE AT ELMENDORF AIRFIELD, IT HAS BEEN INFORMALLY ASCERTAINED THAT THE EARNINGS UNDER THE ARMY CONTRACT HAVE BEEN AVERAGING ABOUT $4,400 PER MONTH, AND THAT IT IS EXPECTED THAT THE EARNINGS UNDER THE AIR FORCE CONTRACT WILL BE $10,000 TO $12,000 A MONTH FOR THE BALANCE OF THE FISCAL YEAR. AS YOU KNOW, THESE CONTRACTS WILL EXPIRE ON JUNE 30, 1955, AND WE UNDERSTAND THAT THEY WILL BE READVERTISED. UNDER YOUR SUGGESTED PLAN OF SETTLEMENT, HOWEVER, THE JULY AND AUGUST INSTALLMENTS, AGGREGATING $15,000, WILL BECOME DUE SUBSEQUENT TO THE TERMINATION OF THOSE CONTRACTS AND AFTER THE PAYMENTS THEREUNDER NORMALLY WOULD BE COMPLETED. THUS, THERE WOULD BE NO FUNDS AVAILABLE AS COLLATERAL OR SECURITY FOR THOSE PAYMENTS. UNDER THESE CIRCUMSTANCES, WE FEEL THAT THE BEST INTERESTS OF THE GOVERNMENT REQUIRE THAT THE VOUCHERS COVERING FINAL PAYMENTS DUE UNDER THE CONTRACTS FOR JUNE 1955 BE FORWARDED HERE BY THE DEPARTMENTS INVOLVED SO THAT THERE MAY BE DEDUCTED FROM THE AMOUNTS THEREOF THE BALANCE OF $15,000 REMAINING DUE UNDER THE SUGGESTED PLAN OF SETTLEMENT. APPROPRIATE INSTRUCTIONS TO THAT END HAVE BEEN ISSUED.

THE CHECKS, BANK DRAFTS, OR MONEY ORDERS COVERING THE FIRST THREE PAYMENTS SHOULD BE MADE PAYABLE TO THE TREASURER OF THE UNITED STATES AND FORWARDED TO THE CLAIMS DIVISION, GENERAL ACCOUNTING OFFICE, WASHINGTON 25, D. C. IT SHOULD BE UNDERSTOOD, HOWEVER, THAT, IN THE EVENT OF DEFAULT IN PAYMENT OF ANY INSTALLMENT, ACTION PROMPTLY WILL BE TAKEN HERE TO WITHHOLD PAYMENTS DUE OR TO BECOME DUE THE DEBTOR FROM THE VARIOUS GOVERNMENT DEPARTMENTS AND AGENCIES IN AN AMOUNT SUFFICIENT TO SATISFY THE OUTSTANDING BALANCE DUE THE UNITED STATES.