B-21229, NOVEMBER 22, 1941, 21 COMP. GEN. 474

B-21229: Nov 22, 1941

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PASSENGER-CARRYING MOTOR VEHICLES - PURCHASE PRICE LIMITATION AND TRANSPORTATION COSTS WHERE THE ACCEPTED BID FOR DESTINATION DELIVERY OF A PASSENGER CARRYING MOTOR VEHICLE SPECIFIED THE "MAIN FACTORY" AS THE POINT OF ORIGIN AND A LOCAL ASSEMBLY PLANT AS THE POINT FROM WHICH DELIVERY TO DESTINATION WAS TO BE MADE. SPECIFIED A LUMP-SUM AMOUNT AS FREIGHT COST WHICH IS REPORTED TO BE A CHARGE APPLIED BY THE MANUFACTURER TO ALL COMMERCIAL PURCHASES TO COVER TRANSPORTATION TO THE ASSEMBLY PLANT. IS WITHIN THE STATUTORY LIMIT. 20 COMP. 1941: I HAVE YOUR LETTER OF OCTOBER 15. ARE REFERRED TO YOUR OFFICE FOR CONSIDERATION AS TO THE AMOUNT. THIS AMOUNT WAS APPROVED FOR PAYMENT AS BEING STRICTLY IN ACCORDANCE WITH THE DECISION OF YOUR OFFICE REPORTED IN 20 COMP.

B-21229, NOVEMBER 22, 1941, 21 COMP. GEN. 474

PASSENGER-CARRYING MOTOR VEHICLES - PURCHASE PRICE LIMITATION AND TRANSPORTATION COSTS WHERE THE ACCEPTED BID FOR DESTINATION DELIVERY OF A PASSENGER CARRYING MOTOR VEHICLE SPECIFIED THE "MAIN FACTORY" AS THE POINT OF ORIGIN AND A LOCAL ASSEMBLY PLANT AS THE POINT FROM WHICH DELIVERY TO DESTINATION WAS TO BE MADE, AND SPECIFIED A LUMP-SUM AMOUNT AS FREIGHT COST WHICH IS REPORTED TO BE A CHARGE APPLIED BY THE MANUFACTURER TO ALL COMMERCIAL PURCHASES TO COVER TRANSPORTATION TO THE ASSEMBLY PLANT, THE ACTUAL COST OF TRANSPORTATION FROM THE DESIGNATED POINT OF ORIGIN TO DESTINATION MAY BE DEDUCTED FROM THE TOTAL DESTINATION PRICE FIXED IN THE CONTRACT IN DETERMINING WHETHER THE PURCHASE PRICE, EXCLUSIVE OF TRANSPORTATION COST, IS WITHIN THE STATUTORY LIMIT. 20 COMP. GEN. 677, DISTINGUISHED.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF WAR, NOVEMBER 22, 1941:

I HAVE YOUR LETTER OF OCTOBER 15, 1941, AS FOLLOWS:

THE ACCOMPANYING PAPERS WITH REFERENCE TO AN AWARD OF CONTRACT FOR FIVE SEDANS MADE BY THE DISTRICT ENGINEER, LOS ANGELES, CALIFORNIA, ARE REFERRED TO YOUR OFFICE FOR CONSIDERATION AS TO THE AMOUNT, IF ANY, WHICH MAY BE PAID TO THE CONTRACTOR IN ADDITION TO $752.00 PER CAR WHICH HAS BEEN AUTHORIZED BY THE CHIEF OF ENGINEERS. THIS AMOUNT WAS APPROVED FOR PAYMENT AS BEING STRICTLY IN ACCORDANCE WITH THE DECISION OF YOUR OFFICE REPORTED IN 20 COMP. GEN. 677.

THE CHIEF OF ENGINEERS INFORMS ME THAT THE AMOUNT OF $140.50 REFERRED TO AS AN ITEM OF FREIGHT HAS BEEN STATED BY THE GOVERNMENT SALES DEPARTMENT OF THE FORD MOTOR COMPANY, ALEXANDRIA, VIRGINIA, AS A CHARGE APPLIED TO ALL COMMERCIAL PURCHASERS AT THE DELIVERY POINT IN QUESTION, AND THERE APPEARS TO BE NO BASIS UPON WHICH THE GOVERNMENT WILL BE ABLE TO SECURE FUTURE BIDS FROM DEALERS UNLESS THE UNITED STATES WILL PAY THE CHARGES ASSESSED AGAINST THE DEALER BY THE MANUFACTURER AND PAID BY ALL PURCHASERS.

WITH THE RECENTLY DRASTIC CURTAILMENT IN AUTOMOBILE PRODUCTION, HIGHER MANUFACTURING COSTS, AND THE INCREASED NEED FOR SUCH EQUIPMENT IN THE PROSECUTION OF DEFENSE PROJECTS, THE RECEIPT OF BIDS WITHIN THE LOW LIMITATION FIXED BY THE CONGRESS IS BECOMING AN EVER INCREASING PROBLEM. MANUFACTURERS ARE TAKING THE POSITION THAT THEIR ENTIRE PRODUCTION SHOULD BE DISPOSED OF THROUGH THE REGULAR COMMERCIAL CHANNELS IF THEY ARE TO PROTECT THEIR EXTENSIVE DEALER ORGANIZATIONS AND DEALERS CANNOT BY REASON OF THEIR LIMITED PROFIT ABSORB CHARGES PASSED ON TO THEM BY THE FACTORY. INDEED, THERE IS NO INCENTIVE TO DO SO, WERE IT AT ALL POSSIBLE, SINCE THERE IS NO DIFFICULTY IN SECURING COMMERCIAL PURCHASERS AT THE REGULAR PRICES. A RECENT INSTANCE OF THE LACK OF INTEREST IN GOVERNMENT AUTOMOBILE PURCHASES, BROUGHT TO THE ATTENTION OF THIS OFFICE, WAS A CALL FOR BIDS ISSUED BY THE INTERIOR DEPARTMENT IN RESPONSE TO WHICH IT IS UNDERSTOOD NO BIDS WERE RECEIVED.

IT MUST BE CONCEDED THAT THERE IS ACTUAL FREIGHT INCURRED IN THE SHIPMENT OF FABRICATED PARTS OF AN ARTICLE TO THE PLACE OF ASSEMBLY AND IT WILL BE APPRECIATED IF YOUR OFFICE WILL GIVE CONSIDERATION TO THE PROBLEM AND, WITH THE RETURN OF THE ACCOMPANYING PAPERS, ADVISE THE DEPARTMENT WHETHER PAYMENT OF THE ADDITIONAL AMOUNT WHICH IS CHARGED TO COMMERCIAL PURCHASERS IN THE USUAL COURSE OF BUSINESS, IS AUTHORIZED.

THERE WAS ENCLOSED WITH YOUR LETTER A REPORT DATED SEPTEMBER 27, 1941, FROM THE CONTRACTING OFFICER WITH RESPECT TO THE MATTER IN QUESTION, AS FOLLOWS:

1. REFERENCE 4-AR, TELETYPE MESSAGE FROM THIS OFFICE DATED SEPTEMBER 24, 1941, AND YOUR REPLY THERETO OF SEPTEMBER 25, 1941, CONCERNING THE PURCHASE BY THIS OFFICE OF FIVE (5) PASSENGER-CARRYING AUTOMOBILES IN APPARENT CONTRAVENTION OF A DECISION OF THE COMPTROLLER GENERAL (20 COMP. GEN. 677).

2. IN ACCORDANCE WITH YOUR REQUEST, THERE ARE ENCLOSED COPIES OF CONTRACT NO. W-509-ENG.-1577, WITH ALL PERTINENT PAPERS ATTACHED THERETO; LETTER FROM THE CONTRACTOR, BOYD H. GIBBONS, DATED SEPTEMBER 19, 1941; AND LETTER FROM THIS OFFICE TO MR. GIBBONS DATED SEPTEMBER 24, 1941.

3. IT WILL BE NOTED THAT UNDER ITEM (A) OF DATA TO BE FURNISHED, PAGE 8 OF INVITATION NO. 509-42-10, THE CONTRACTOR GIVES DEARBORN, MICH., AS THE POINT OF ORIGIN, AND $140.50 AS THE FREIGHT RATE. THESE FACTORS WERE USED IN ARRIVING AT A DETERMINATION AS TO WHETHER THE BID PRICE WAS IN EXCESS OF THE STATUTORY LIMITATION OF $750.00, AND ONLY AFTER THE AUTOMOBILES HAD BEEN DELIVERED, ACCEPTED, AND PLACED IN USE WAS IT NOTED THAT THE METHOD OF TRANSPORTATION (TRUCK AWAY FROM LONG BEACH BRANCH) INDICATED THE LONG BEACH ASSEMBLY PLANT AS POINT OF ORIGIN, THUS RESTRICTING THE ALLOWANCE FOR TRANSPORTATION COSTS TO TRUCK AWAY CHARGES OF APPROXIMATELY $2.00 PER CAR, AND PLACING THE DELIVERED PRICE OF $832.00 PER CAR APPROXIMATELY $80.00 IN EXCESS OF THE STATUTORY LIMITATION OF $750.00.

4. IN VIEW OF THE CIRCUMSTANCES, THE DISBURSING OFFICER DOES NOT CONSIDER THAT HE IS JUSTIFIED IN MAKING PAYMENT OF THE CONTRACTOR'S INVOICE, AND HAS REQUESTED THAT THE MATTER BE REFERRED TO YOUR OFFICE. IT IS THEREFORE REQUESTED THAT THE ENCLOSED PAPERS BE REVIEWED AND THAT THIS OFFICE BE ADVISED AT THE EARLIEST PRACTICABLE DATE OF WHAT ACTION, IF ANY, SHOULD BE TAKEN TO MAKE PAYMENT TO THE CONTRACTOR, AND WHETHER PAYMENT MAY BE MADE IN FULL OR FOR ONLY THE AMOUNT PERMISSIBLE UNDER THE EXISTING STATUTORY LIMITATION.

5. IT IS DESIRED TO CALL THE ATTENTION OF THE OFFICE, CHIEF OF ENGINEERS, TO THE ADVERSE RESULTS, AS FAR AS THIS OFFICE IS CONCERNED, OF THE PROVISIONS OF 20 COMP. GEN. 677.

6. OWING TO THE RECENT DECLINE IN RATE OF AUTOMOBILE PRODUCTION AND THE CONCOMITANT INCREASE IN PRICES, IT HAS BECOME VERY DIFFICULT TO SECURE BIDS IN RESPONSE TO INVITATIONS ISSUED IN CONNECTION WITH AUTOMOBILE PURCHASES. AS AN EXAMPLE, BOYD H. GIBBONS WAS THE ONLY BIDDER OF 34 TO WHOM INVITATION NO. 509-42-10 WAS SENT. HAD HIS BID BEEN REJECTED, THE RESULTANT DELAY IN PROCURING URGENTLY NEEDED AUTOMOBILES WOULD HAVE CAUSED A SERIOUS INTERRUPTION IN THE WORK OF THE DISTRICT, WHICH IS ENGAGED ON MANY NATIONAL DEFENSE PROJECTS.

7. UNDER THE PROVISIONS OF 20 COMP. GEN. 677, AGENCIES OF MANUFACTURERS WHO MAKE LOCAL DELIVERIES FROM WEST COAST ASSEMBLY PLANTS ARE PROHIBITED FROM BIDDING ON AUTOMOBILES FOR GOVERNMENT USE SINCE THEY CANNOT POSSIBLY SET A DELIVERED PRICE WITHIN THE STATUTORY LIMITATION UNLESS THE COST OF TRANSPORTATION FROM FACTORIES IS USED IN COMPUTING THE PRICE AT ORIGIN. COMPETITION IS THUS RESTRICTED TO MAKES OF CARS WHICH ARE NOT ASSEMBLED ON THE WEST COAST, UNLESS IT MAY BE POSSIBLE TO OBTAIN BIDS FROM DEALERS IN THE EASTERN PORTION OF THE COUNTRY OR DIRECT FROM THE FACTORIES. THE LATTER POSSIBILITY IS CONSIDERED UNLIKELY, SINCE IT IS DEFINITELY UNDERSTOOD THAT NO DEALER MAY SUBMIT BIDS ON FORD AUTOMOBILES FOR FACTORY DELIVERY.

8. IT IS THE BELIEF OF THIS OFFICE THAT EVERY EFFORT SHOULD BE MADE TOWARD OBTAINING A MODIFICATION OF 20 COMP. GEN. 677.

THE DECISION OF APRIL 26, 1941, TO THE SECRETARY OF THE INTERIOR, 20 COMP. GEN. 677, INVOLVED CASES WHERE THE ADMINISTRATIVE OFFICE, IN DETERMINING WHETHER THE PURCHASE PRICE OF A PASSENGER-CARRYING MOTOR VEHICLE, EXCLUSIVE OF TRANSPORTATION, WAS WITHIN THE STATUTORY LIMIT OF $750, ASSUMED THAT THE MAIN FACTORY WHERE AUTOMOBILES OR COMPONENT PARTS MAY BE MANUFACTURED WAS, IN EVERY INSTANCE, THE "POINT OF ORIGIN" OF AUTOMOBILES PURCHASED FOR THE GOVERNMENT, IRRESPECTIVE OF ANY POINT FROM WHICH OR AT WHICH A BIDDER PROPOSED DELIVERY OR NAMED AS THE POINT OF ORIGIN OF HIS SELECTION, OR FROM WHICH DELIVERY ACTUALLY WAS MADE. THAT DECISION, AT PAGES 683 AND 684, IT WAS SAID:

IT WILL BE SEEN FROM THE FOREGOING THAT THE PURCHASING OFFICER OF YOUR DEPARTMENT HAS RELIED FOR JUSTIFICATION OF THE PROCEDURE FOLLOWED IN THESE CASES UPON HIS APPARENT INTERPRETATION OF OFFICE DECISION OF APRIL 16, 1938, TO YOU, 17 COMP. GEN. 854, AND UPON HIS APPARENT VIEW THAT THE MAIN FACTORY WHERE AUTOMOBILES OR COMPONENT PARTS MAY BE MANUFACTURED IS THE "POINT OF ORIGIN" OF AUTOMOBILES PURCHASED FOR THE GOVERNMENT IN EVERY INSTANCE, IRRESPECTIVE OF ANY POINT FROM WHICH OR AT WHICH A BIDDER MAY PROPOSE DELIVERY OR MAY NAME AS THE POINT OF ORIGIN OF HIS SELECTION, OR FROM WHICH DELIVERY ACTUALLY MAY BE MADE. SUCH A PROPOSITION OR VIEW WAS NEGATIVED IN A DECISION OF MARCH 27, 1939, TO THE SECRETARY OF AGRICULTURE, B-2072, MANY MONTHS BEFORE ANY OF THE CONTRACTS HERE UNDER CONSIDERATION WERE CONSUMMATED, AND WHILE, AS SUGGESTED BY YOUR PURCHASING OFFICER, THAT DECISION CONSIDERED CERTAIN CASES WHERE PRICES SUBMITTED, INCLUSIVE OF TRANSPORTATION COSTS, WERE WITHIN THE STATUTORY PRICE LIMIT, FOR THE REASON THAT THE SUBMISSION OF THE SECRETARY OF AGRICULTURE IN THAT INSTANCE HAD REFERENCE TO SPECIFIC INSTANCES CITED THEREIN, THE PRINCIPLE STATED AND RULE LAID DOWN WOULD APPEAR TO BE APPLICABLE IN ANY CASE--- THAT THERE WAS NO LEGAL AUTHORITY FOR TREATING PURPORTED MAIN FACTORY PRICES ARBITRARILY ARRIVED AT AS ACTUAL PRICES OF THE VEHICLES IN EVERY INSTANCE WITHOUT REGARD TO PRICES QUOTED FOR DELIVERY AT OR FROM SOME OTHER POINT OR POINTS OF ORIGIN OF BIDDER'S SELECTION, AND WITHOUT REGARD TO THE ACTUAL POINT OF ORIGIN. IT IS TO BE NOTED IN THIS CONNECTION THAT THE INSTANCES CITED IN THE SUBMISSION OF THE SECRETARY OF AGRICULTURE WERE THOSE IN WHICH BIDS WERE RECEIVED FROM MANUFACTURERS OF THE VEHICLES INVOLVED, THE PURPORTED PRICES OF SOME ITEMS FOR DELIVERY F.O.B.'MAIN FACTORY LOCATION" AND ON OTHERS FOR DELIVERY AT VARIOUS ASSEMBLY PLANTS. IT WAS SAID THAT WHILE BIDDERS MIGHT AND SHOULD BE REQUESTED TO SUBMIT PRICES FOR DELIVERY BOTH F.O.B. GOVERNMENT DESTINATION AND F.O.B. POINT OF BIDDER'S SELECTION-- FACTORY OR OTHERWISE--- THERE WAS NO LEGAL COMPULSION UPON A BIDDER, EITHER MANUFACTURER OR DEALER, TO SUBMIT FACTORY PRICES IN EVERY INSTANCE, WHATEVER THEY MIGHT BE, OR TO UNDERTAKE DELIVERY AT SOME POINT OTHER THAN HIS OWN SELECTION, FACTORY OR OTHERWISE. A FORTIORI, WOULD THE RULE STATED IN THAT DECISION BE FOR APPLICATION WHEN THERE IS NO SHOWING AS TO ACTUAL FACTORY OR ASSEMBLY PLANT PRICES, NO SHOWING OF WHAT AMOUNT IS ACTUALLY INCLUDED IN A BID FOR COST OF TRANSPORTATION, AND THE ONLY "VEHICLE PRICE" ARRIVED AT IS A PURELY SUPPOSITIONAL OR THEORETICAL PRICE BASED UPON A MERE ASSUMPTION THAT IF A BID HAD BEEN RECEIVED QUOTING A PRICE F.O.B.'MAIN FACTORY," IT WOULD HAVE BEEN THE PRICE ARBITRARILY DETERMINED BY SUBTRACTION FROM THE AMOUNT OF A DESTINATION BID OF A SUM EQUAL TO THE ADMINISTRATIVELY COMPUTED TRANSPORTATION COST FROM THE PURPORTED "MAIN FACTORY?

IN A DECISION OF JANUARY 20, 1938, TO THE SECRETARY OF THE INTERIOR, 17 COMP. GEN. 580, IT WAS SAID AT PAGE 583:

* * * IN THE CASE OF A LOW BIDDER OFFERING DESTINATION BID, ONLY, IN EXCESS OF $750, THERE WOULD BE PROPER FOR CONSIDERATION THE ACTUAL COST OF TRANSPORTATION FROM POINT OF ORIGIN TO DESTINATION BY THE ROUTE AND MEANS MOST ADVANTAGEOUS TO THE GOVERNMENT; 14 COMP. GEN. 82; 16 COMP. GEN. 210; ID. 448. * * * ( ITALICS SUPPLIED.)

SEE 18 COMP. GEN. 554, 556, AND 17 COMP. GEN. 854, WHICH LAST MENTIONED DECISION SET FORTH A STATEMENT OF GENERAL PRINCIPLES APPLICABLE TO PURCHASE OF PASSENGER-CARRYING VEHICLES AND SUGGESTED A PARAGRAPH FOR INCLUSION IN ALL INVITATIONS FOR BIDS COVERING FUTURE PURCHASES OF SUCH VEHICLES. ALSO, SEE 20 COMP. GEN. 739, WHEREIN IT WAS STATED AT PAGE 742 THAT:

THE SUBTRACTION OF A FIGURE EQUAL TO THE AMOUNT OF THE NECESSARY TRANSPORTATION COST FROM POINT OF ORIGIN FROM A BID OFFERING A VEHICLE FOR DESTINATION DELIVERY, ONLY, AT A PRICE IN EXCESS OF $750 IS AUTHORIZED AND PERMISSIBLE SOLELY FOR DETERMINATION AS TO WHETHER SUCH BID, EXCLUSIVE OF ACTUAL AND NECESSARY TRANSPORTATION COST BY THE MEANS AND METHOD MOST ADVANTAGEOUS, IS WITHIN THE STATUTORY PRICE LIMITATION AND SO LEGALLY FOR CONSIDERATION ON ANY BASIS. THERE IS NO ACTUAL DEDUCTION OF SUCH AMOUNT FROM THE PURCHASE PRICE QUOTED BY THE BIDDER, BUT THE FULL PURCHASE PRICE IS PAID TO THE CONTRACTOR AS THE CONTRACT PRICE, UPON THE BASIS THAT A PORTION OF THE CONTRACT PRICE HAS BEEN OR WILL BE EXPENDED BY THE CONTRACTOR FOR TRANSPORTATION OF THE VEHICLE FROM POINT OF ORIGIN--- FACTORY OR OTHERWISE--- TO POINT OF DELIVERY AS A NECESSARY ITEM OF EXPENSE AND AS SEPARATE AND DISTINCT FROM THE BASE PRICE OF THE VEHICLE. * * * ( ITALICS SUPPLIED.)

PARAGRAPH 10 OF THE SPECIFICATIONS IN THE PRESENT CASE IS AS FOLLOWS:

10. AUTHORITY TO PURCHASE.--- BY STATUTORY LIMITATION, THE PRICE AT POINT OF ORIGIN OF EACH AUTOMOBILE TO BE PURCHASED SHALL NOT EXCEED $750.00, EXCLUDING TRANSPORTATION CHARGES. ACCORDINGLY, TO RECEIVE CONSIDERATION, THE BID FOR EACH VEHICLE MUST NOT EXCEED $750.00, IF PRICE AT ORIGIN IS QUOTED. IF PRICE AT DESTINATION ONLY IS QUOTED AND IS IN EXCESS OF $750.00, THE BIDDER MUST SHOW IN THE SPACES PROVIDED ON THE SCHEDULE: THE FREIGHT RATE, METHOD OF TRANSPORTATION, SHIPPING WEIGHT, AND POINT OF ORIGIN.

PURSUANT TO SAID PARAGRAPH, AND ON THE FORM PROVIDED THEREFOR, THE BIDDER HERE INVOLVED--- HAVING QUOTED AN F.O.B. DESTINATION PRICE--- STATED THE FREIGHT RATE AS $140.50, HIS METHOD OF TRANSPORTATION AS " TRUCK AWAY FROM LONG BEACH BRANCH," THE SHIPPING WEIGHT AS 3,146 POUNDS AND THE POINT OF ORIGIN AS DEARBORN, MICH. WHILE, APPARENTLY, IT WAS THE INTENTION OF THE BIDDER TO SUBMIT HIS BID IN ACCORDANCE WITH THE REQUIREMENTS OF THE INVITATION, IT IS TO BE NOTED THAT THE PROPER INFORMATION WAS NOT FURNISHED IN THE BID WITH RESPECT TO THE FREIGHT RATE AND METHOD OF TRANSPORTATION; THAT IS TO SAY THE TOTAL PURPORTED COST OF TRANSPORTATION OF EACH AUTOMOBILE WAS SHOWN RATHER THAN THE RATE, AS REQUESTED, AND THE STATEMENT " TRUCK AWAY FROM LONG BEACH BRANCH" APPARENTLY HAD REFERENCE ONLY TO THE METHOD OF TRANSPORTATION INTENDED TO BE USED IN DELIVERING THE AUTOMOBILES FROM AN ASSEMBLY PLANT AT LONG BEACH TO DESTINATION. HOWEVER, IN FURTHER EXPLANATION OF THE BID, THE BIDDER, IN A LETTER DATED SEPTEMBER 19, 1941, TO THE CONTRACTING OFFICER, ADVISED IN PERTINENT PART, AS FOLLOWS: WE HAVE, THIS DATE, BEEN ADVISED BY MR. FERDINAND MEINICKE OF THE SUPPLY DEPARTMENT THAT HIS AUTHORITY PERMITS HIM TO PAY ONLY $750.00 FOR EACH UNIT OR A TOTAL OF $3,750.00 FOR THE PURCHASE, DUE TO A RULING MADE BY THE COMPTROLLER GENERAL IN APRIL 1941 TO THE EFFECT THAT $750.00 WOULD BE THE MAXIMUM AMOUNT PAID FOR AN AUTOMOBILE PLUS ANY TRANSPORTATION CHARGES FROM THE LOCAL ASSEMBLY PLANT TO POINT OF DESTINATION RATHER THAN POINT OF ORIGIN, WHICH, IN OUR CASE, IS DEARBORN, MICHIGAN. THE SCHEDULE WHICH WE SUBMITTED TO YOU AT THE TIME OF THE BID SHOWS IN THE SPACES PROVIDED THAT $140.50 IS THE FREIGHT RATE PAID ON EACH OF THE FIVE UNITS DELIVERED TO YOU AND THAT IS THE AMOUNT CHARGED THE DEALER BY THE FORD MOTOR COMPANY.

ALSO, YOU HAVE REPORTED THAT THE AMOUNT OF $140.50 REFERRED TO AS AN ITEM OF FREIGHT HAS BEEN STATED BY THE GOVERNMENT SALES DEPARTMENT OF THE FORD MOTOR CO., ALEXANDRIA, VA., AS A CHARGE APPLIED TO ALL COMMERCIAL PURCHASES AT THE DELIVERY POINT IN QUESTION TO COVER TRANSPORTATION TO THE ASSEMBLY PLANT. THUS IT APPEARS THAT THE BID WAS SUBMITTED, OR INTENDED TO BE SUBMITTED, IN ACCORDANCE WITH THE INVITATION. CONSEQUENTLY, IN CONFORMITY WITH THE INTENT AND MEANING OF DECISIONS OF THIS OFFICE, SOME OF WHICH ARE HEREINABOVE REFERRED TO, THERE IS PROPER FOR CONSIDERATION, IN DETERMINING WHETHER THE BID PRICE FOR THE AUTOMOBILES HERE INVOLVED IS WITHIN THE STATUTORY PRICE LIMIT, THE ACTUAL COST OF TRANSPORTATION THEREOF FROM THE POINT OF ORIGIN SHOWN IN THE BID TO DESTINATION.

ACCORDINGLY, YOU ARE ADVISED THAT IF IT BE DETERMINED THAT THE ACTUAL TRANSPORTATION COST IN THIS INSTANCE EQUALS OR EXCEEDS THE DIFFERENCE BETWEEN THE MAXIMUM PRICE, $750, AS FIXED BY THE STATUTE AND THE TOTAL DELIVERED COST FIXED IN THE CONTRACT, PAYMENT OF THE FULL CONTRACT PRICE IS AUTHORIZED.