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B-156082, MAY 1, 1967

B-156082 May 01, 1967
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TO THE POSTMASTER GENERAL: REFERENCE IS MADE TO A LETTER DATED APRIL 5. REFERENCE WAS ALSO MADE TO OUR DECISION B-156082. SINCE WE ARE UNAWARE OF ANY PREEXISTING AUTHORITY TO MAKE ANY SUCH REJECTION. WE ALSO HELD THAT ONCE A DETERMINATION IS MADE THAT THE PURCHASE OF MATERIALS OF DOMESTIC ORIGIN AT A GREATER DIFFERENTIAL THAN THAT PROVIDED IN THE EXECUTIVE ORDER WOULD NOT BE UNREASONABLE OR WOULD NOT BE INCONSISTENT WITH THE PUBLIC INTEREST. STATES THAT YOU ARE AWARE THAT PURSUANT TO SECTION 5 A HIGHER DIFFERENTIAL MAY BE FIXED. THAT THIS WILL NOT NECESSARILY SOLVE YOUR PROBLEMS. THE BUY AMERICAN ACT ITSELF REQUIRES THAT BEFORE THE PURCHASE OF DOMESTIC SUPPLIES MAY BE MADE PURSUANT TO THAT LAW THE HEAD OF THE EXECUTIVE AGENCY CONCERNED MUST DETERMINE THAT THE COST IS NOT UNREASONABLE.

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B-156082, MAY 1, 1967

TO THE POSTMASTER GENERAL:

REFERENCE IS MADE TO A LETTER DATED APRIL 5, 1967, TO OUR GENERAL COUNSEL FROM THE GENERAL COUNSEL OF THE POST OFFICE DEPARTMENT RESPECTING 41 U.S.C. 10 (A) TO 10 (D), COMMONLY REFERRED TO AS THE BUY AMERICAN ACT, AS IMPLEMENTED BY EXECUTIVE ORDER NO. 10582, DECEMBER 17, 1954. REFERENCE WAS ALSO MADE TO OUR DECISION B-156082, DATED JULY 20, 1966, HOLDING THE BUY AMERICAN ACT APPLICABLE TO THE LEASING OF VEHICLES BY YOUR DEPARTMENT. THE LETTER OF APRIL 5, 1967, FURTHER EXPRESSES THE WISH OF YOUR DEPARTMENT TO COMPLY, IF LEGALLY POSSIBLE, WITH THE DESIRE ENUNCIATED BY THE COMMITTEE ON APPROPRIATIONS, HOUSE OF REPRESENTATIVES, THAT FOREIGN -MADE VEHICLES NOT BE LEASED FOR POSTAL PURPOSES. IN RELATION THERETO, THE LETTER SPECIFICALLY ASKS WHETHER BIDS OFFERING FOREIGN-MADE VEHICLES MAY BE REJECTED FOR REASONS OF THE NATIONAL INTEREST, PURSUANT TO SECTION 3 (A), EXECUTIVE ORDER NO. 10582, AND IF NOT WHETHER SUCH BIDS MAY BE REJECTED PURSUANT TO ANY OTHER AUTHORITY.

SECTION 3 (A), EXECUTIVE ORDER NO. 10582, DOES NOT CREATE ANY NEW AUTHORITY FOR REJECTING BIDS AND AS SUCH MAY NOT BE THE SOLE AUTHORITY RELIED UPON TO REJECT A BID. THAT SECTION STATES:

"SEC. 3. NOTHING IN THIS ORDER SHALL AFFECT THE AUTHORITY OR RESPONSIBILITY OF AN EXECUTIVE AGENCY:

"/A) TO REJECT ANY BID OR OFFER FOR REASONS OF THE NATIONAL INTEREST NOT DESCRIBED OR REFERRED TO IN THIS ORDER; OR" IN OUR DECISION 42 COMP. GEN. 608, APRIL 30, 1963, WE HELD THAT SECTION 3 (A) OF EXECUTIVE ORDER NO. 10582 DID NOT CONFER ON EXECUTIVE AGENCIES ANY NEW OR ADDITIONAL AUTHORITY TO REJECT ANY BID FOR REASONS OF NATIONAL INTEREST. SINCE WE ARE UNAWARE OF ANY PREEXISTING AUTHORITY TO MAKE ANY SUCH REJECTION, WE BELIEVE THAT SECTION 3 (A) CANNOT BE RELIED UPON. IN OUR DECISION 42 COMP. GEN. 608, WE ALSO HELD THAT ONCE A DETERMINATION IS MADE THAT THE PURCHASE OF MATERIALS OF DOMESTIC ORIGIN AT A GREATER DIFFERENTIAL THAN THAT PROVIDED IN THE EXECUTIVE ORDER WOULD NOT BE UNREASONABLE OR WOULD NOT BE INCONSISTENT WITH THE PUBLIC INTEREST, THERE THEN WOULD BE FOR APPLICATION THE PROVISION IN SECTION 5 OF EXECUTIVE ORDER NO. 10582 WHICH STATES THAT UNDER THOSE CIRCUMSTANCES THE "ORDER SHALL NOT APPLY," THUS PLACING THE MATTER SQUARELY WITHIN THE PURVIEW OF THE BUY AMERICAN ACT ITSELF WHICH PROVIDES THAT ONLY DOMESTIC SUPPLIES SHALL BE ACQUIRED FOR PUBLIC USE UNLESS THE HEAD OF THE DEPARTMENT CONCERNED DETERMINES THEIR COST TO BE UNREASONABLE.

THE LETTER OF APRIL 5, 1967, STATES THAT YOU ARE AWARE THAT PURSUANT TO SECTION 5 A HIGHER DIFFERENTIAL MAY BE FIXED, BUT THAT THIS WILL NOT NECESSARILY SOLVE YOUR PROBLEMS. IN THIS RESPECT IT SHOULD BE NOTED THAT REGARDLESS OF WHETHER EXECUTIVE ORDER NO. 10582 APPLIES, THE BUY AMERICAN ACT ITSELF REQUIRES THAT BEFORE THE PURCHASE OF DOMESTIC SUPPLIES MAY BE MADE PURSUANT TO THAT LAW THE HEAD OF THE EXECUTIVE AGENCY CONCERNED MUST DETERMINE THAT THE COST IS NOT UNREASONABLE. THE LEGISLATIVE HISTORY OF PRIOR BILLS AND COMMITTEE REPORTS, OUT OF WHICH DEVELOPED THE BUY AMERICAN ACT, REVEALS THAT CONGRESS INTENDED THE HEAD OF THE AGENCY SHOULD PURCHASE DOMESTIC SUPPLIES NOTWITHSTANDING THAT THEY MAY COST MORE IF SUCH COST BE NOT UNREASONABLE.

IN VIEW OF THE ABOVE IT IS THE OPINION OF THIS OFFICE THAT BIDS OFFERING FOREIGN-MADE VEHICLES FOR LEASE MAY NOT BE REJECTED PURSUANT TO SECTION 3 (A), EXECUTIVE ORDER NO. 10582. FURTHER YOU ARE ADVISED THAT WE ARE AWARE OF NO OTHER AUTHORITY UNDER WHICH A LOW BID MAY BE REJECTED SOLELY BECAUSE IT OFFERS A FOREIGN-MADE VEHICLE.

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