B-164788, OCTOBER 10, 1968, 48 COMP. GEN. 193

B-164788: Oct 10, 1968

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LAW COMPLIANCE AS THE NATIONAL ZOOLOGICAL PARK (ZOO) IS CONSIDERED GOVERNMENT PROPERTY. THE AUTHORITY OF THE REGENTS OF THE ZOO IS SUBJECT TO THE LIMITATIONS APPLICABLE GENERALLY TO ADMINISTRATIVE OFFICIALS OF THE GOVERNMENT. LIMITATIONS THAT ARE NOT AFFECTED BY THE ACT OF NOVEMBER 6. ANY ARRANGEMENT FOR THE OPERATION OF FOOD CONCESSIONS AT THE ZOO IS SUBJECT TO ADVERTISING PROCEDURES. IN SUPPORT OF YOUR PROPOSAL TO NEGOTIATE SUCH CONTRACTUAL ARRANGEMENTS REFERENCE IS MADE TO DECISIONS IN WHICH WE HELD THAT CONTRACTS OR CONCESSION AGREEMENTS MIGHT BE NEGOTIATED WITHOUT PUBLIC ADVERTISING FOR SIMILAR SERVICES IN THE MUSEUM OF HISTORY AND TECHNOLOGY (B-145878. 1964) AND YOU POINT OUT THAT THOSE BUILDINGS WERE CONSTRUCTED PRIMARILY THROUGH THE USE OF GOVERNMENT APPROPRIATIONS.

B-164788, OCTOBER 10, 1968, 48 COMP. GEN. 193

SMITHSONIAN INSTITUTION - CONTRACTS - ADVERTISING, ETC., LAW COMPLIANCE AS THE NATIONAL ZOOLOGICAL PARK (ZOO) IS CONSIDERED GOVERNMENT PROPERTY, THE AUTHORITY OF THE REGENTS OF THE ZOO IS SUBJECT TO THE LIMITATIONS APPLICABLE GENERALLY TO ADMINISTRATIVE OFFICIALS OF THE GOVERNMENT, LIMITATIONS THAT ARE NOT AFFECTED BY THE ACT OF NOVEMBER 6, 1966, AUTHORIZING NEGOTIATION OF CONCESSION OPERATIONS AT THE ZOO WITH NONPROFIT, SCIENTIFIC, EDUCATIONAL, OR HISTORIC ORGANIZATIONS AND, THEREFORE, ANY ARRANGEMENT FOR THE OPERATION OF FOOD CONCESSIONS AT THE ZOO IS SUBJECT TO ADVERTISING PROCEDURES. HOWEVER, AS THE USE OF A SINGLE CONTRACT TO PROCURE RESTAURANT CONCESSIONS AT SMITHSONIAN FACILITIES, INCLUDING THE ZOO, WOULD BE MORE ECONOMICAL AND EFFICIENT, UPON THE ISSUANCE OF A DETERMINATION THAT IT WOULD NOT BE FEASIBLE OR PRACTICABLE TO USE FORMAL ADVERTISING PROCEDURES, A COMBINED CONTRACT MAY BE NEGOTIATED UNDER 41 U.S.C. 252 (C) (10) AND SECTION 1-3.210 OF THE FEDERAL PROCUREMENT REGULATIONS.

TO THE SECRETARY, SMITHSONIAN INSTITUTION, OCTOBER 10, 1968:

WE REFER TO YOUR LETTER OF JULY 5, 1968, SUPPLEMENTED BY LETTER OF AUGUST 5 FROM MR. JAMES BRADLEY, REQUESTING ADVICE AS TO THE PROPRIETY OF NEGOTIATING CONTRACTUAL ARRANGEMENTS FOR THE OPERATION OF CAFETERIA SERVICES IN THE NATIONAL ZOOLOGICAL PARK (OTHERWISE REFERRED TO AS THE ZOO) IN WASHINGTON, D.C.

IN SUPPORT OF YOUR PROPOSAL TO NEGOTIATE SUCH CONTRACTUAL ARRANGEMENTS REFERENCE IS MADE TO DECISIONS IN WHICH WE HELD THAT CONTRACTS OR CONCESSION AGREEMENTS MIGHT BE NEGOTIATED WITHOUT PUBLIC ADVERTISING FOR SIMILAR SERVICES IN THE MUSEUM OF HISTORY AND TECHNOLOGY (B-145878, SEPTEMBER 1, 1961) AND IN THE JOHN F. KENNEDY CENTER FOR THE PERFORMING ARTS (44 COMP. GEN. 607, OCTOBER 30, 1964) AND YOU POINT OUT THAT THOSE BUILDINGS WERE CONSTRUCTED PRIMARILY THROUGH THE USE OF GOVERNMENT APPROPRIATIONS, AS WERE ALSO THE BUILDING AND IMPROVEMENTS AT THE ZOO.

AS YOU STATE, OUR OFFICE HAS RECOGNIZED THE UNIQUE NATURE OF THE SMITHSONIAN INSTITUTION AND OF THE PROPERTY APPROPRIATED FOR ITS USES AND PURPOSES. IN FACT, THE DECISIONS TO WHICH YOU REFER WERE GROUNDED SQUARELY UPON OUR CONCLUSION THAT THE ACT OF AUGUST 10, 1846 (9 STAT. 102), WHICH CREATED THE INSTITUTION TO ADMINISTER THE SMITHSON TRUST, CONFERRED UPON THE BOARD OF REGENTS PLENARY AUTHORITY TO MANAGE THE TRUST PROPERTY AND AFFAIRS OF THE INSTITUTION WITHOUT REGARD TO THE LAWS REQUIRING ADVERTISING OF GOVERNMENT CONTRACTS. IN EACH OF THOSE CASES, HOWEVER, IT WAS HELD THAT THE PARTICULAR BUILDING INVOLVED HAD BY CONGRESSIONAL ACTION BEEN, IN EFFECT, APPROPRIATED TO THE SMITHSONIAN INSTITUTION AND DEDICATED TO THE TRUST PURPOSES TO THE SAME EXTENT AS THE BUILDINGS ORIGINALLY AUTHORIZED AND CONSTRUCTED FROM THE FUNDS OF THE TRUST.

WITH RESPECT TO THE NATIONAL ZOOLOGICAL PARK, HOWEVER, WE HAVE HELD THAT THIS IS THE PROPERTY OF THE UNITED STATES, AND NOT A PART OF THE LANDS APPROPRIATED TO THE SMITHSONIAN INSTITUTION BY THE ACT OF APRIL 30, 1846, 9 STAT. 104 (20 U.S.C. 52). SEE 42 COMP. GEN. 650, MAY 27, 1963, IN WHICH IT WAS HELD THAT THE AUTHORITY OF THE REGENTS OF THE SMITHSONIAN INSTITUTION OVER THE ZOO, WHICH WAS CONFERRED BY THE ACT OF APRIL 30, 1890, 26 STAT. 78 (20 U.S.C. 81), WAS TO BE EXERCISED SUBJECT TO ALL LIMITATIONS AND RESTRICTIONS APPLICABLE GENERALLY TO ADMINISTRATIVE OFFICIALS OF THE GOVERNMENT.

BY PUBLIC LAW 89-772 OF NOVEMBER 6, 1966, 20 U.S.C. 85, THE CONGRESS SPECIFICALLY AUTHORIZED THE REGENTS "IN FURTHERANCE OF THE MISSION OF THE NATIONAL ZOOLOGICAL PARK * * * TO NEGOTIATE AGREEMENTS GRANTING CONCESSIONS AT THE NATIONAL ZOOLOGICAL PARK TO NONPROFIT SCIENTIFIC, EDUCATIONAL, OR HISTORIC ORGANIZATIONS.'

IN THE LIGHT OF OUR DECISIONS RUNNING BACK AT LEAST TO APRIL 4, 1929, A- 23158, IN WHICH THE RESTAURANT CONCESSION AT THE ZOO HAS BEEN REGARDED AS SUBJECT TO FORMAL ADVERTISING PROCEDURE, WE BELIEVE THAT THE RESTRICTION IMPOSED UPON THE ABOVE NEGOTIATING AUTHORITY BY THE UNDERSCORED ENUMERATION OF THE CLASSES OF ORGANIZATIONS WITH WHICH CONCESSIONS COULD BE NEGOTIATED NEGATES ANY POSSIBLE INTERPRETATION OF THE CITED ACT AS AFFECTING THE LIMITATIONS ON THE AUTHORITY OF THE REGENTS WITH RESPECT TO THE ZOO CONCESSION IN ANY OTHER RESPECT.

OUR BELIEF IS SUPPORTED BY THE LEGISLATIVE HISTORY OF PUBLIC LAW 89 772, WHICH INCLUDES A LETTER DATED JUNE 3, 1966, FROM YOU TO THE CHAIRMAN OF THE SENATE COMMITTEE ON RULES AND ADMINISTRATION IN WHICH THE FOLLOWING STATEMENT APPEARS:

IT IS NOT THE INTENT OF SECTION 1 OF THIS LEGISLATION TO CHANGE THE PROCEDURES WHEREBY THE RESTAURANT CONCESSION AT THE NATIONAL ZOOLOGICAL PARK IS LET THROUGH COMPETITIVE BIDDING.

THE BUREAU OF THE BUDGET ADVISES THAT FROM THE STANDPOINT OF THE PRESIDENT'S PROGRAM THERE IS NO OBJECTION TO THE ENACTMENT OF SECTION 1 OF S. 3230.

THE BUREAU OF THE BUDGET, HOWEVER, HAS RECOMMENDED THAT RECONSIDERATION BE GIVEN SECTION 2, WHICH WOULD ALLOW THE SMITHSONIAN INSTITUTION TO NEGOTIATE ITS CAFETERIA CONCESSION AT THE NATIONAL ZOOLOGICAL PARK, RATHER THAN TO AWARD IT ON THE BASIS OF COMPETITIVE BIDDING, AND TO RETAIN THE GOVERNMENT PORTION OF THE RECEIPTS FROM THE NEGOTIATED AGREEMENT TO BE USED FOR RESEARCH AND EDUCATIONAL PURPOSES FOR THE BENEFIT OF THE NATIONAL ZOOLOGICAL PARK. THE SMITHSONIAN INSTITUTION HAS RECONSIDERED SECTION 2 AND RESPECTFULLY REQUESTS THAT IT BE DELETED FROM S.REPT. NO. 1580, 89TH CONG., 2D SESS.)

SECTION 2 WAS ACCORDINGLY DELETED, AND THE BILL AS ENACTED CONSISTED ONLY OF WHAT HAD ORIGINALLY BEEN DESIGNATED SECTION 1.

WE THEREFORE FEEL THAT WE MUST ADHERE TO OUR LONGSTANDING AND FREQUENTLY ASSERTED POSITION THAT THE CONCESSION TO OPERATE THE RESTAURANT AND RELATED ACTIVITIES IN THE NATIONAL ZOOLOGICAL PARK MAY NOT BE GRANTED EXCEPT IN ACCORDANCE WITH THE LAW APPLICABLE TO THE USE OF GOVERNMENT PROPERTY GENERALLY.

IN YOUR LETTER OF JULY 5 TO US YOU STATED AS FOLLOWS:

THE PRIMARY PURPOSE OF THESE CAFETERIA SERVICES IS CONVENIENCE TO THE VISITING PUBLIC AND STAFF MEMBERS. HOWEVER, LONG EXPERIENCE HAS SHOWN THAT BIDDING FOR THIS PRIVILEGE IS NOT COMPATIBLE WITH THE SELECTION OF EXPERIENCED OPERATORS WITH DEMONSTRATED DEDICATION TO PUBLIC SERVICE. BELIEVE THAT BY COMBINING ALL OF THE SMITHSONIAN RESTAURANT CONCESSIONS INTO ONE MASTER AGREEMENT, A CONTRACTUAL ARRANGEMENT MORE ADVANTAGEOUS TO BOTH THE VISITING PUBLIC AND THE SMITHSONIAN INSTITUTION COULD BE NEGOTIATED.

THIS STATEMENT WAS AMPLIFIED BY THE FOLLOWING LANGUAGE IN MR. BRADLEY'S LETTER OF AUGUST 5:

IF IT IS POSSIBLE TO OPERATE ALL PRESENT AND FUTURE DINING FACILITIES OF THE INSTITUTION UNDER A SINGLE NEGOTIATED CONTRACT, SEVERAL IMPORTANT BENEFITS WILL ACCRUE.

THE SINGLE CONTRACT FOR A GROUP OF FACILITIES WILL MAKE POSSIBLE MUCH GREATER ECONOMIES OF OPERATION THAN ARE AVAILABLE IN EACH UNIT INDEPENDENTLY, BECAUSE OF THE GREATER VOLUME OF SALES AND REDUCED OVERHEAD AND SUPERVISORY EXPENSE, AND THESE ECONOMIES WILL BE PASSED ON TO THE PUBLIC IN THE FORM OF GREATLY IMPROVED FOOD AND SERVICE WITHOUT AN INCREASE IN PRICES; AND, DEALING WITH A SINGLE ORGANIZATION WILL MAKE OUR LIMITED SUPERVISORY PERSONNEL MUCH MORE EFFECTIVE IN ENSURING THAT HIGH STANDARDS ARE MAINTAINED.

IN THE LIGHT OF THE ABOVE STATEMENTS, YOUR ATTENTION IS DIRECTED TO OUR DECISION OF MAY 12, 1966, 45 COMP. GEN. 685, TO THE CHAIRMAN OF THE BOARD OF TRUSTEES OF THE JOHN F. KENNEDY CENTER FOR THE PERFORMING ARTS. WE THERE HELD THAT THE CONTRACT FOR THE CONSTRUCTION OF THE CENTER SHOULD BE MADE IN ACCORDANCE WITH THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949, 40 U.S.C. 471 NOTE, BUT STATED THAT IN VIEW OF THE REPRESENTATIONS MADE BY THE GENERAL COUNSEL OF THE BOARD OF TRUSTEES, WITH THE CONCURRENCE OF THE GENERAL SERVICES ADMINISTRATION, AS TO THE PECULIAR FEATURES AND REQUIREMENTS OF THE CENTER, WE WOULD HAVE NO OBJECTION TO THE NEGOTIATION OF A CONTRACT UNDER EXCEPTION 10 OF SECTION 302 (C) OF THAT ACT (41 U.S.C. 252 (C) (10) AND SECTION 1-3.210 OF THE FEDERAL PROCUREMENT REGULATIONS, UPON THE ISSUANCE OF A DETERMINATION SETTING FORTH FACTS AND CIRCUMSTANCES CLEARLY AND CONVINCINGLY ESTABLISHING THAT THE USE OF FORMAL ADVERTISING WAS NEITHER FEASIBLE NOR PRACTICABLE.

IT IS THEREFORE SUGGESTED THAT IF YOU BELIEVE THE SPECIAL FACTORS TO WHICH YOU REFER WOULD JUSTIFY THE CONCLUSION THAT THE USE OF FORMAL ADVERTISING FOR NEGOTIATING A COMBINED CONTRACT FOR THE RESTAURANT OPERATIONS AT THE THREE FACILITIES IN QUESTION, INCLUDING THE ZOO, WOULD NOT BE FEASIBLE OR PRACTICABLE AND ISSUE A DETERMINATION AND FINDING TO THAT EFFECT, OUR OFFICE WOULD NOT QUESTION THE NEGOTIATION OF SUCH A CONTRACT UNDER THE EXCEPTION REFERRED TO IN OUR DECISION OF MAY 12, 1966.