B-155146, FEB 5, 1974, 53 COMP GEN 558

B-155146: Feb 5, 1974

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SINCE THE PROPOSED PROGRAM WILL BE A MAJOR DEPARTURE FROM PRESENT PRACTICES IT IS RECOMMENDED THAT THE PLAN BE INITIATED AS AN EXPERIMENTAL ONE OF LIMITED SCOPE AND DURATION TO TEST THE FEASIBILITY AND DESIRABILITY OF THE PROGRAM. IS STUDYING THE FEASIBILITY OF ESTABLISHING TWO EXPERIMENTAL CHARTER SYSTEMS TO BE PROVIDED BY UNITED STATES-FLAG AIR CARRIERS OVER SELECTED HIGH DENSITY GOVERNMENT TRAVEL ROUTES WITH THE GOAL OF LOWERING THE COST OF OFFICIAL INTERNATIONAL AIR TRAVEL BY EMPLOYEES OF THE FEDERAL GOVERNMENT. YOU HAVE DETERMINED THAT A REVOLVING FUND WOULD BE THE BEST POSSIBLE METHOD OF FINANCING THE PROCUREMENT OF CHARTERED AIRCRAFT OR BLOCKED SPACE PRIOR TO REIMBURSEMENT BY USING GOVERNMENT AGENCIES AND THAT THE ONLY REVOLVING FUND AVAILABLE FOR SUCH USE IS THE GENERAL SUPPLY FUND.

B-155146, FEB 5, 1974, 53 COMP GEN 558

GENERAL SERVICES ADMINISTRATION - GENERAL SUPPLY FUND - AIRCRAFT SERVICES PROCUREMENT THE PROCUREMENT BY THE GENERAL SERVICES ADMINISTRATION OF CHARTERED AIRCRAFT OR BLOCKED SPACE ON REGULARLY SCHEDULED AIRCRAFT PRIOR TO REIMBURSEMENT BY USING GOVERNMENT AGENCIES MAY BE FINANCED FROM THE GENERAL SUPPLY FUND ESTABLISHED BY SECTION 109(A) OF THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949, AS AMENDED, 40 U.S.C. 756(A), FOR THE PURPOSE OF "PROCURING *** NON-PERSONAL SERVICES." ALTHOUGH NOTHING IN THE APPLICABLE STATUTE OR ITS LEGISLATIVE HISTORY PRECLUDES THE USE OF THE FUND TO PROCURE CHARTERED AIRCRAFT AND/OR BLOCKED SPACE ON AIRCRAFT, SINCE THE PROPOSED PROGRAM WILL BE A MAJOR DEPARTURE FROM PRESENT PRACTICES IT IS RECOMMENDED THAT THE PLAN BE INITIATED AS AN EXPERIMENTAL ONE OF LIMITED SCOPE AND DURATION TO TEST THE FEASIBILITY AND DESIRABILITY OF THE PROGRAM, AND THAT THE PLAN BE DISCLOSED TO THE INTERESTED COMMITTEES OF THE CONGRESS BEFORE PROCEEDING WITH AN EXTENSIVE PROGRAM OF CHARTERING AIRCRAFT.

TO THE ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, FEBRUARY 5, 1974:

BY LETTER DATED JUNE 26, 1973, YOU REQUESTED OUR VIEWS ON THE AVAILABILITY OF THE GENERAL SUPPLY FUND (FUND), ESTABLISHED BY SECTION 109(A) OF THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949 (ACT), AS AMENDED, 40 U.S.C. 756(A), FOR THE PROCUREMENT OF CHARTERED AIRCRAFT OR BLOCKED SPACE ON REGULARLY SCHEDULED AIRCRAFT.

YOU STATE THAT THE GENERAL SERVICES ADMINISTRATION (GSA), AFTER UNSUCCESSFUL ATTEMPTS TO NEGOTIATE REDUCED AIR FARES, IS STUDYING THE FEASIBILITY OF ESTABLISHING TWO EXPERIMENTAL CHARTER SYSTEMS TO BE PROVIDED BY UNITED STATES-FLAG AIR CARRIERS OVER SELECTED HIGH DENSITY GOVERNMENT TRAVEL ROUTES WITH THE GOAL OF LOWERING THE COST OF OFFICIAL INTERNATIONAL AIR TRAVEL BY EMPLOYEES OF THE FEDERAL GOVERNMENT. ONE EXPERIMENTAL SYSTEM WOULD CONSIST OF CONTRACTED BLOCKED SPACE ROUND TRIP SERVICE ON SCHEDULED FLIGHTS BETWEEN THE EAST COAST AND SELECTED POINTS IN EUROPE AND ANOTHER OF CONTRACTED FULL PLANELOAD ROUND TRIP CHARTER SERVICE WITH CARRIERS BETWEEN THE UNITED STATES AND SELECTED POINTS IN EUROPE. GSA HAS HELD DISCUSSIONS WITH BOTH SCHEDULED UNITED STATES-FLAG INTERNATIONAL AIR CARRIERS AND SUPPLEMENTAL (CHARTER) CARRIERS. GSA HAS ALSO ENGAGED IN DISCUSSIONS WITH THE DEPARTMENT OF DEFENSE REGARDING THE FEASIBILITY OF COMBINING THAT DEPARTMENT'S TRAVELERS WITH CIVIL AGENCY TRAVELERS ON SUCH CHARTER FLIGHTS. YOU STATE THAT THIS PROPOSAL SHOULD RESULT IN SUBSTANTIAL SAVINGS AND ESTIMATE THAT WITH A SEVENTY PERCENT LOAD FACTOR, A ROUND TRIP FLIGHT BETWEEN WASHINGTON AND FRANKFURT, GERMANY, COULD SAVE THE GOVERNMENT $50,000.

YOU HAVE DETERMINED THAT A REVOLVING FUND WOULD BE THE BEST POSSIBLE METHOD OF FINANCING THE PROCUREMENT OF CHARTERED AIRCRAFT OR BLOCKED SPACE PRIOR TO REIMBURSEMENT BY USING GOVERNMENT AGENCIES AND THAT THE ONLY REVOLVING FUND AVAILABLE FOR SUCH USE IS THE GENERAL SUPPLY FUND.

THE PROVISIONS OF 40 U.S.C. 756(A) ARE, IN PERTINENT PART, AS FOLLOWS:

THE GENERAL SUPPLY FUND SHALL BE AVAILABLE FOR USE BY OR UNDER THE DIRECTION AND CONTROL OF THE ADMINISTRATOR (1) FOR PROCURING PERSONAL PROPERTY *** AND NONPERSONAL SERVICES FOR THE USE OF FEDERAL AGENCIES IN THE PROPER DISCHARGE OF THEIR RESPONSIBILITIES, ***.

IT IS YOUR AGENCY'S VIEW THAT THE AVAILABILITY OF THE FUND FOR THE PROCURING OF "NONPERSONAL SERVICES" WOULD SEEM TO BE AUTHORITY FOR ITS USE. YOU POINT OUT THAT WHILE THERE IS NO SPECIFIC PROVISION AUTHORIZING SUCH USE OF THE FUND, NEITHER HAVE YOU FOUND A RESTRICTION AGAINST SUCH USE. YOU STATE, HOWEVER, THAT THE MATTER IS NOT ENTIRELY FREE FROM DOUBT IN VIEW OF THE FACT THAT THE AMENDMENT BY SECTION 2 OF PUBLIC LAW 83-766, SEPTEMBER 1, 1954, 68 STAT. 1126, OF SECTION 211 OF THE ACT, 40 U.S.C. 491, TO PERMIT THE ESTABLISHMENT OF CENTRAL MOTOR POOLS CONTAINED A PROVISION SPECIFICALLY MAKING THE FUND AVAILABLE FOR SUCH POOLS. YOU STATE IN THIS REGARD THAT:

THE LEGISLATIVE HISTORY OF SECTION 211 DOES NOT REVEAL IF THERE WAS CONSIDERATION AS TO WHETHER THIS PROVISION WAS IN FACT REQUIRED TO MAKE THE GENERAL SUPPLY FUND AVAILABLE FOR FINANCING THE MOTOR VEHICLE SERVICES. HOWEVER, IT IS OUR VIEW THAT THE TERM "NONPERSONAL SERVICES" IS SUFFICIENTLY BROAD AND GENERIC TO EMBRACE CHARTERED AIRCRAFT AND BLOCKED SPACE.

YOU CONCLUDE THAT THE FUND SEEMS TO BE WELL SUITED FOR FINANCING THE PROPOSED SYSTEM AND THAT YOU DO NOT ANTICIPATE THAT THE PROGRAM WOULD BE OF SUFFICIENT MAGNITUDE TO CREATE A PROBLEM IN PAYING FOR ANY OF THE SERVICES ORDINARILY PROCURED AND FURNISHED THROUGH THE FUND.

WE AGREE WITH YOUR POSITION THAT THERE IS NOTHING IN THE APPLICABLE STATUTE OR LEGISLATIVE HISTORY WHICH WOULD SPECIFICALLY PRECLUDE THE USE OF THE FUND TO PROCURE CHARTERED AIRCRAFT AND/OR BLOCKED SPACE ON AIRCRAFT. ALSO, WE CANNOT STATE THAT SUCH PROCUREMENT NECESSARILY REPRESENTS THE ACQUISITION OF A CAPITAL ASSET THAT NORMALLY WOULD BE REQUIRED TO BE REQUISITIONED THROUGH AN APPROPRIATION RATHER THAN THROUGH THE REVOLVING FUND AS AN EXPENSE ITEM NOR CAN WE STATE THAT SUCH A SYSTEM WOULD NOT CONSTITUTE PROCUREMENT OF "NONPERSONAL SERVICES" WITHIN THE MEANING OF 40 U.S.C. 756(A).

ON THE OTHER HAND, THE IMPLEMENTATION OF THE PROPOSED PROGRAM WOULD REPRESENT A MAJOR DEPARTURE FROM PRESENT PRACTICES. IT WOULD TRANSFER MAJOR RESPONSIBILITIES TO GSA AND PLACE IT, IN EFFECT, IN THE POSITION OF OPERATING A CHARTER SERVICE FOR THE GOVERNMENT. THUS, IT WOULD APPEAR THAT THE PROPOSED PROGRAM MIGHT RAISE MANY SERIOUS POLICY QUESTIONS WHICH SHOULD ULTIMATELY BE CONSIDERED BY THE CONGRESS. IN THIS REGARD WE HAVE REVIEWED THE LEGISLATIVE HISTORY OF THE 1954 AMENDMENT OF SECTION 211 OF THE ACT. WE NOTE THAT IN CONSIDERING THAT AMENDMENT THE CONGRESS WAS CONCERNED ABOUT, AMONG OTHER THINGS, THE POLICY IMPLICATIONS OF CREATING A CENTRAL MOTOR POOL; ON THE OTHER HAND, WE NOTE SEVERAL DIFFERENCES BETWEEN THE PROPOSED PLAN AND THE CREATION OF A MOTOR POOL SUCH AS THAT THE LATTER INVOLVED ACQUIRING EXISTING ASSETS FROM OTHER AGENCIES AND THAT SIGNIFICANT CAPITAL ASSETS WERE TO BE ACQUIRED.

CONSIDERING THE BROAD LANGUAGE OF THE FUND AUTHORIZING USE OF THE FUND TO ACQUIRE "NONPERSONAL SERVICES" WE WILL NOT BE REQUIRED TO OBJECT IF YOUR AGENCY INITIATES AN EXPERIMENTAL SYSTEM OF CHARTERING AIRCRAFT AND BLOCKED SPACE OF LIMITED SCOPE AND DURATION IN ORDER TO TEST THE FEASIBILITY AND DESIRABILITY OF SUCH A PROGRAM. HOWEVER, IN VIEW OF THE BROAD POLICY ISSUES RAISED AND THE POSSIBLE DESIRE OF THE CONGRESS TO EXPRESS ITSELF ON THIS MATTER, WE BELIEVE THAT THE PROPOSED PLAN SHOULD BE DISCLOSED TO THE INTERESTED COMMITTEES OF THE CONGRESS BEFORE PROCEEDING WITH AN EXTENSIVE PROGRAM OF CHARTERING AIRCRAFT ON OTHER THAN AN EXPERIMENTAL BASIS.

YOUR LETTER OF AUGUST 14, 1973, TO WHICH WE REPLIED ON SEPTEMBER 6, 1973, MENTIONS TWO ADDITIONAL OPTIONS YOU APPARENTLY HAVE UNDER CONSIDERATION INVOLVING THE USE OF DOD AIR CHARTER CONTRACTS WITH U.S. FLAG INTERNATIONAL AIRLINES: (1) EXTENSION OF CATEGORY Z (MILITARY) TARIFFS TO ALL OFFICIAL INTERNATIONAL AIR TRAVEL, AND (2) VARYING CATEGORY Z TYPE FARES TO AVOID PEAK TRAFFIC DAYS. WE UNDERSTAND THAT NO DECISION TO USE THESE OPTIONS HAS YET BEEN MADE.

WE THINK THESE OPTIONS INVOLVE ADDITIONAL LEGAL PROBLEMS NOT PRESENTED TO US. WE EXPRESS NO OPINION ON THE LEGALITY OF SUCH OPTIONS BUT WILL BE GLAD TO CONSIDER THEM IF YOU DECIDE TO USE DOD AIR CHARTER CONTRACTS.