B-153042, DEC. 20, 1963

B-153042, DEC. 20, 1963

TO ALLEN, DEGARMO AND LEEDY:

YOUR LETTER OF DECEMBER 6, 1963, WITH ENCLOSURES, REQUESTS OUR ASSISTANCE IN EXPEDITING A PAYMENT DUE PREMIER-H AND K CONSTRUCTORS UNDER CORPS OF ENGINEERS CONTRACT DA-1650.

WE HAVE BEEN INFORMALLY ADVISED BY THE OFFICE OF THE CHIEF OF ENGINEERS THAT THE UNSETTLED CLAIMS UNDER THE CONTRACT ARE BEING PROCESSED AS EXPEDITIOUSLY AS POSSIBLE WITH DUE REGARD FOR THE APPLICABLE ADMINISTRATIVE AND STATUTORY REQUIREMENTS RESPECTING THE FUNDING OF MILITARY CONSTRUCTION PROJECTS.

WE HAVE BEEN ADVISED BY THAT OFFICE OF THE DETAILS OF THESE CONTRACT CLAIMS. IN SEPTEMBER 1961 AN URGENT PROJECT OF THE UNITED STATES AIR FORCE TO INCREASE THE CAPACITY OF THE EXISTING HAINES-FAIRBANKS PIPELINE, AT AN ESTIMATED COST OF $4,750,000, WAS APPROVED BY THE DEPARTMENT OF DEFENSE UNDER SECTION 103, PUB.L. 86-500, 74 STAT. 169. BASED ON BIDS RECEIVED IN FEBRUARY 1962, THE THEN CURRENT WORKING ESTIMATE WAS $5,007,034. THIS ESTIMATE WAS SUBSEQUENTLY INCREASED TO $5,086,000 DUE TO AN APPROVED INCREASE IN SCOPE OF THE PROJECT. DURING THE COURSE OF CONSTRUCTION, A CONSIDERABLE NUMBER OF CHANGES BECAME NECESSARY. THE CONTRACTORS SUBSEQUENTLY PRESENTED CLAIMS, DUE TO CHANGES, TO THE CONTRACTING OFFICER. WITH FUNDS AVAILABLE TO HIM, THE CONTRACTING OFFICER PAID A TOTAL OF $284,000 IN SETTLED CLAIMS TO THE CONTRACTORS AND THEN REQUESTED ADDITIONAL FUNDS AND AUTHORIZATION FOR THE ESTIMATED BALANCE OF THE CLAIMS PRESENTED, INCLUDING CLAIMS ON WHICH AGREEMENT HAD BEEN REACHED AND THOSE STILL UNDER NEGOTIATION. NECESSARY ACTION TO INCREASE THE AUTHORIZATION UNDER SECTION 103 AND TO OBTAIN TRANSFER OF ADDITIONAL FUNDS FROM THE AIR FORCE TO COVER THE ADDITIONAL COSTS WAS INITIATED AND FORWARDED ON SEPTEMBER 24, 1963. ADDITIONAL DETAILED INFORMATION, WHICH IS ESSENTIAL TO THE PAYMENT OF THE CLAIMS, IS CURRENTLY BEING PROCESSED FOR SUBMITTAL. WE ARE ADVISED FURTHER THAT THE CONTRACTING OFFICER IS PREPARED TO PAY ALL UNPAID CLAIMS WHICH HAVE BEEN AGREED TO IMMEDIATELY UPON RECEIPT OF REQUESTED AUTHORIZATION, AND THAT FUNDS ARE AVAILABLE IN THE APPROPRIATION CONTINGENCY RESERVE. THE OFFICE OF THE CHIEF OF ENGINEERS INDICATED INFORMALLY THAT THE UNSETTLED CLAIMS WOULD THEN BE PAID AS SOON AS AGREEMENT ON THEM IS CONCLUDED.

ALTHOUGH IT MIGHT APPEAR THAT PAYMENT OF THE CONTRACT CLAIMS IS BEING UNDULY DELAYED, THE PROCESSING OF SUCH CLAIMS ARISING UNDER CONTRACTS EXECUTED PURSUANT TO SECTION 103, SUPRA, IS NECESSARILY SUBJECT TO, AND DEPENDENT UPON, THE FISCAL AND ACCOUNTING PROCEDURES PRESCRIBED TO INSURE THAT PUBLIC FUNDS ARE EXPENDED IN ACCORDANCE WITH LAW. OUR OFFICE ORDINARILY DOES NOT BECOME INVOLVED IN THE SETTLEMENT OF CURRENT CONTRACT CLAIMS BY THE MILITARY DEPARTMENTS. WE HAVE, HOWEVER, INFORMALLY REQUESTED THE OFFICE OF THE CHIEF OF ENGINEERS TO EXPEDITE PAYMENT OF THE CLAIMS IN VIEW OF THE REPRESENTATIONS MADE IN YOUR LETTER.