B-126649, FEB. 10, 1956

B-126649, FEB. 10, 1956

TO THE TUDOR PRESS INCORPORATED:

REFERENCE IS MADE TO YOUR LETTER DATED DECEMBER 19, 1955, CONCERNING AN AMOUNT OF $4,789.46, WITHHELD BY SETTLEMENT NO. 2261121, DATED MAY 13, 1955, WHICH YOU CONTEND IS STILL DUE YOU FOR WORK PERFORMED UNDER PURCHASE ORDER NO. K-530, DATED AUGUST 12, 1954, ENTERED INTO WITH THE TREASURY DEPARTMENT, BUREAU OF ENGRAVING AND PRINTING.

PURCHASE ORDER NO. K-530 PROVIDED THAT YOU WOULD FURNISH ALL LABOR AND MATERIAL (EXCEPT AS SPECIFICALLY PROVIDED TO BE FURNISHED BY THE BUREAU OF ENGRAVING AND PRINTING) NECESSARY TO FURNISH CERTAIN QUANTITIES OF PRINTED MATTER IN COMPLETE ACCORDANCE WITH BUREAU SPECIFICATIONS DATED JUNE 9, 1954.

THE SPECIFICATIONS, ATTACHED TO PURCHASE ORDER NO. K-530, PROVIDED THAT ALL PAPER FOR THE PRINTING REQUIRED WOULD BE SUPPLIED BY THE BUREAU OF ENGRAVING AND PRINTING, AND THAT, BEFORE PRINTING, THE PAPER TO BE USED WOULD BE SUBJECT TO TEST BY THE BUREAU OF ENGRAVING AND PRINTING.

THE AMOUNT OF $4,789.46, CLAIMED IN YOUR LETTER OF DECEMBER 19, 1955, CONSISTS OF THE FOLLOWING ITEMS: (1) $1,512.06 DISALLOWED BECAUSE OF THE USE OF NON-SPECIFICATION PAPER; (2) $1,851.41 WITHHELD PENDING RECEIPT OF EVIDENCE OF PAYMENT OF PENALTIES AND OVERTIME UNDER THE FAIR LABOR STANDARDS ACT; AND (3) $1,425.99 WITHHELD TO COVER POSSIBLE ADJUSTMENTS AND PENALTIES.

YOU STATE IN YOUR LETTER THAT ITEM 1 IN THE AMOUNT OF $1,512.06 SHOULD BE REMITTED BECAUSE THE PAPER WAS FURNISHED BY THE GOVERNMENT OR ITS AGENT. THE RECORD SHOWS THAT BY LETTER DATED SEPTEMBER 14, 1954, YOU REQUESTED THAT THE SPECIFICATION BE REVISED TO PERMIT A NUMBERING OPERATION TO BE PERFORMED ON DOUBLE-SIZE SHEETS OF 32 INCHES BY 54 INCHES SIZE, AND THAT YOU WOULD BE RESPONSIBLE FOR ANY LOSS TO THE GOVERNMENT INCURRED IN SUCH OPERATION. ON SEPTEMBER 16, 1954, AN AMENDMENT TO THE PURCHASE ORDER WAS ISSUED, AND SINCE THE BUREAU WAS IN DOUBT AS TO THE FEASIBILITY OF NUMBERING THE PRINTED MATTER IN DOUBLE-SIZE SHEETS, IT WAS PROVIDED THAT YOU WOULD BE RESPONSIBLE FOR ANY LOSS TO THE GOVERNMENT INCURRED THROUGH NUMBERING THE DOUBLE-SIZE SHEETS, AND THE RECORD SHOWS YOU ACCEPTED THIS AMENDMENT. IT IS REPORTED FURTHER THAT YOU CHOSE TO PERFORM THE NUMBERING OF THE ENTIRE CONTRACT IN DOUBLE-SIZE SHEETS, AND IT WAS DETERMINED BY BUREAU REPRESENTATIVES, PRESENT AT THE SITE, THAT THIS DECISION ON YOUR PART WAS ALMOST EXCLUSIVELY THE SOLE CAUSE OF EXCESSIVE SPOILAGE WHICH REQUIRED ADDITIONAL SHIPMENTS OF PAPER.

IN LETTER OF FEBRUARY 8, 1955, FROM THE BUREAU OF ENGRAVING AND PRINTING, YOU WERE ADVISED THAT THE SAMPLES OF THE ADDITIONAL PAPER WHICH YOU HAD RECEIVED FROM THE KEITH PAPER COMPANY, TURNER FALLS, MASSACHUSETTS, DID NOT MEET SPECIFICATIONS AND THAT, SINCE YOU HAD GONE AHEAD AND PRINTED AND NUMBERED THE PAPER WITHOUT WAITING FOR THE RESULTS OF THE LABORATORY TESTS, THE COST OF THE PAPER AND TRANSPORTATION COSTS WOULD BE CHARGED AGAINST ANY PAYMENTS DUE YOU. YOU WERE ADVISED FURTHER THAT A NEW LOT OF PAPER MEETING BUREAU SPECIFICATIONS WOULD BE SHIPPED AND THE COST OF THE PAPER, PLUS TRANSPORTATION, WOULD BE CHARGED AGAINST YOUR ACCOUNT. THESE COSTS, IN THE AMOUNT OF $1,512.06, WERE DISALLOWED IN SETTLEMENT NO. 2264121 FOR THE REASON, AND WE BELIEVE PROPERLY SO, THAT YOU DID NOT ADHERE TO THE PROVISIONS OF THE SPECIFICATIONS WHICH REQUIRED YOU TO AWAIT THE RESULTS OF THE LABORATORY TESTS ON THE ADDITIONAL PAPER SUPPLIED TO YOU.

ITEMS 2 AND 3, SET FORTH IN YOUR LETTER OF DECEMBER 19, 1955, CONSISTING OF THE AMOUNTS OF $1,851.41 AND $1,425.99, WERE WITHHELD IN SETTLEMENT NO. 2261121 PENDING RECEIPT OF EVIDENCE OF PAYMENT OF PENALTIES UNDER THE FAIR LABOR STANDARDS ACT AND TO COVER POSSIBLE ADJUSTMENTS; HOWEVER, THESE AMOUNTS WERE SUBSEQUENTLY ALLOWED IN SETTLEMENT NO. 2263592, DATED JULY 26, 1955. THEY WERE APPLIED TO YOUR INDEBTEDNESS FOR FEDERAL UNEMPLOYMENT TAX FOR 1954, AND WITHHOLDING AND F.I.C.A. TAX ASSESSMENT FOR THE FIRST QUARTER OF 1955.

ACCORDINGLY, THERE APPEARS TO BE NO FURTHER AMOUNT DUE YOU UNDER PURCHASE ORDER NO. K-530.