B-62132, DECEMBER 27, 1946, 26 COMP. GEN. 442

B-62132: Dec 27, 1946

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

AS THE MAXIMUM COMPENSATION RATE WHICH MAY BE PAID FOR THE OTHERWISE AUTHORIZED PERSONAL SERVICES OF EXPERTS OR CONSULTANTS PROCURED BY CONTRACT IS NOT LIMITED TO THE HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT FOR SIMILAR SERVICES BUT MAY BE THE MAXIMUM RATE PRESCRIBED BY SAID ACT (AT PRESENT. IS TO BE REGARDED AS A CONTRACT FOR THE PERFORMANCE OF NONPERSONAL SERVICES AS TO WHICH THE MAXIMUM COMPENSATION LIMITATION PRESCRIBED BY SAID SECTION 15 WITH RESPECT TO OTHERWISE AUTHORIZED PERSONAL SERVICES PROCURED BY CONTRACT DOES NOT APPLY. IN SUCH CASES THE SERVICES ARE TO BE WITHOUT REGARD TO THE CIVIL SERVICE AND CLASSIFICATION LAWS AND. IS LIMITED SO THAT IN THE CASE OF AGENCIES SUBJECT TO THE CLASSIFICATION ACT THE RATES PAID FOR THE SERVICES MAY NOT BE IN EXCESS OF THE PER DIEM EQUIVALENT OF THE HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT.

B-62132, DECEMBER 27, 1946, 26 COMP. GEN. 442

PROCUREMENT OF PERSONAL, ETC., SERVICES BY CONTRACT - DELEGATION OF AUTHORITY; APPLICABILITY OF MAXIMUM COMPENSATION LIMITATION OF ACT OF AUGUST 2, 1946 UNDER SECTION 12 OF THE ADMINISTRATIVE EXPENSE STATUTE OF AUGUST 2, 1946, AUTHORIZING THE HEAD OF ANY DEPARTMENT TO DELEGATE TO SUBORDINATES THE POWER,"PERTAINING TO THE EMPLOYMENT * * * OF PERSONNEL," THE HEAD OF A DEPARTMENT MAY, IN GENERAL, DELEGATE THE AUTHORITY VESTED IN HIM BY SECTION 15 OF THE ACT RESPECTING THE EMPLOYMENT BY CONTRACT OF THE TEMPORARY OR INTERMITTENT SERVICES OF EXPERTS OR CONSULTANTS OR ORGANIZATIONS THEREOF, INCLUDING STENOGRAPHIC REPORTING SERVICES, PROVIDED SUCH DELEGATION BE NOT PRECLUDED BY THE APPROPRIATION OR OTHER ACT AUTHORIZING THE PROCUREMENT OF SUCH SERVICES. THE PER DIEM EQUIVALENT OF THE "HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT" PRESCRIBED BY SECTION 15 OF THE ADMINISTRATIVE EXPENSE STATUTE OF AUGUST 2, 1946, AS THE MAXIMUM COMPENSATION RATE WHICH MAY BE PAID FOR THE OTHERWISE AUTHORIZED PERSONAL SERVICES OF EXPERTS OR CONSULTANTS PROCURED BY CONTRACT IS NOT LIMITED TO THE HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT FOR SIMILAR SERVICES BUT MAY BE THE MAXIMUM RATE PRESCRIBED BY SAID ACT (AT PRESENT, $38.46 PER DAY). A CONTRACT FOR STENOGRAPHIC REPORTING SERVICES AWARDED IN ACCORDANCE WITH THE ADVERTISING FOR BIDS REQUIREMENTS OF SECTION 3709, REVISED STATUTES, PURSUANT TO SECTION 15 OF THE ADMINISTRATIVE EXPENSE STATUTE OF AUGUST 2, 1946, NOT BEING ONE FOR THE PERSONAL SERVICES OF AN INDIVIDUAL SELECTED ON THE BASIS OF ABILITY AND QUALIFICATIONS BUT ONE FOR THE FURNISHING OF A COMPLETED PRODUCT, IS TO BE REGARDED AS A CONTRACT FOR THE PERFORMANCE OF NONPERSONAL SERVICES AS TO WHICH THE MAXIMUM COMPENSATION LIMITATION PRESCRIBED BY SAID SECTION 15 WITH RESPECT TO OTHERWISE AUTHORIZED PERSONAL SERVICES PROCURED BY CONTRACT DOES NOT APPLY.

COMPTROLLER GENERAL WARREN TO THE FEDERAL SECURITY ADMINISTRATOR, DECEMBER 27, 1946:

THERE HAS BEEN CONSIDERED YOUR LETTER OF NOVEMBER 26, 1946, AS FOLLOWS:

SECTION 15 OF THE ACT OF AUGUST 2, 1946 ( PUBLIC LAW 600, 79TH CONGRESS) PROVIDES THAT THE HEAD OF ANY DEPARTMENT, WHEN AUTHORIZED IN AN APPROPRIATION OR OTHER LAW, MAY PROCURE THE TEMPORARY SERVICES OF EXPERTS OR CONSULTANTS OR ORGANIZATIONS THEREOF, INCLUDING STENOGRAPHIC REPORTING SERVICES, BY CONTRACT, AND IN SUCH CASES THE SERVICES ARE TO BE WITHOUT REGARD TO THE CIVIL SERVICE AND CLASSIFICATION LAWS AND, EXCEPT IN THE CASE OF STENOGRAPHIC REPORTING SERVICES BY ORGANIZATIONS, WITHOUT REGARD TO SECTION 3709 OF THE REVISED STATUTES. THE EXEMPTION FROM THE CLASSIFICATION LAWS, HOWEVER, IS LIMITED SO THAT IN THE CASE OF AGENCIES SUBJECT TO THE CLASSIFICATION ACT THE RATES PAID FOR THE SERVICES MAY NOT BE IN EXCESS OF THE PER DIEM EQUIVALENT OF THE HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT, UNLESS OTHER RATES ARE SPECIFICALLY PROVIDED IN THE APPROPRIATION OR OTHER LAW.

WE ARE NOW IN THE PROCESS OF DRAFTING LANGUAGE FOR OUR 1948 APPROPRIATION ACT. MUCH OF THE LANGUAGE PREVIOUSLY INCLUDED IN OUR APPROPRIATIONS HAS HAD TO BE CHANGED AS A RESULT OF THE ENACTMENT OF PUBLIC LAW 600. SEVERAL QUESTIONS INVOLVING THE MEANING OF SOME OF THE PROVISIONS OF HIS NEW LAW HAVE ARISEN IN THE COURSE OF OUR DRAFTING AND YOUR DECISION ON THESE QUESTIONS IS DESIRED. ANY CLARIFYING LANGUAGE INCLUDED IN OUR APPROPRIATION AS A MEANS OF ( AVOIDING THESE QUESTIONS MIGHT, ON THE ONE HAND, BE SUBJECT TO ELIMINATION ON A POINT OF ORDER OR, ON THE OTHER HAND, PROVE TO BE UNNECESSARY; AND IT IS OUR UNDERSTANDING THAT THE INCLUSION OF UNNECESSARY LANGUAGE IN APPROPRIATIONS IS CONTRARY TO ONE OF THE PURPOSES OF PUBLIC LAW 600--- TO ELIMINATE MUCH OF THE LANGUAGE WHICH HAS PREVIOUSLY APPEARED IN THE ANNUAL APPROPRIATION ACTS.

SECTION 12 OF PUBLIC LAW 600 PROVIDES, AMONG OTHER THINGS, THAT THE HEAD OF A DEPARTMENT MAY DELEGATE TO SUBORDINATE OFFICIALS THE POWER VESTED IN HIM BY LAW TO TAKE FINAL ACTION ON "MATTERS PERTAINING TO THE EMPLOYMENT, DIRECTION, AND GENERAL ADMINISTRATION OF PERSONNEL UNDER HIS DEPARTMENT.' IT IS OUR BELIEF THAT THE PROCUREMENT OF TEMPORARY SERVICES BY CONTRACT IS SUCH A MATTER; AND THE REPORT OF THE SENATE COMMITTEE ( REPORT NO. 1636, 79TH CONGRESS, 2D SESSION) LENDS SUPPORT TO THIS BELIEF IN ITS STATEMENT ON THE PURPOSE OF SECTION 12. THE PERTINENT PART OF THE REPORT READS AS FOLLOWS:

"IN VIEW OF THE SIZE TO WHICH THE GOVERNMENT ESTABLISHMENT HAS GROWN, DELEGATION OF AUTHORITY RESPECTING APPOINTMENT, DIRECTION AND GENERAL ADMINISTRATION OF PERSONNEL IS BELIEVED TO BE DESIRABLE AND NECESSARY IN THE INTEREST OF RAPID AND EFFICIENT ADMINISTRATION.'

HOWEVER, THE APPLICABILITY OF THAT SECTION TO THE AUTHORITY DEALT WITH IN SECTION 15 IS NOT COMPLETELY FREE FROM DOUBT. THE FIRST QUESTION AS TO WHICH YOUR DECISION IS DESIRED, IS THEREFORE, WHETHER THE AUTHORITY WHICH MAY BE GRANTED PURSUANT TO SECTION 15 IS DELEGABLE PURSUANT TO SECTION 12.

THE SECOND QUESTION CONCERNS THE LIMITATION WHICH RESTRICTS THE RATE PAYABLE FOR SERVICES PROCURED PURSUANT TO SECTION 15 TO A RATE NOT IN EXCESS OF THE PER DIEM EQUIVALENT OF THE HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT. THOUGH WE HAVE ASSUMED THAT THE "HIGHEST RATE" MEANS $38.46 PER DAY AND NOT MERELY THE HIGHEST RATE PAYABLE FOR SIMILAR WORK UNDER THE CLASSIFICATION ACT--- SO THAT WE DO NOT HAVE TO TRY TO DETERMINE IN EACH CASE WHAT SALARY THE EXPERT WOULD GET IF HE WERE A CIVIL SERVICE EMPLOYEE--- WE ARE AT A LOSS TO DISCOVER HOW TO APPLY THIS LIMITATION TO A STENOGRAPHIC REPORTER WHO CHARGES SO MUCH PER PAGE. WE SHOULD APPRECIATE YOUR DECISION, THEREFORE, (A) AS TO WHETHER THE ASSUMPTION MADE IS CORRECT, AND (B) WHETHER THE LIMITATION IN QUESTION IS APPLICABLE TO SERVICES PERFORMED BY AN INDIVIDUAL AND PAID FOR EITHER ON A PER PAGE BASIS ALONE OR ON A PER DIEM PLUS A PER PAGE BASIS.

SECTIONS 12 AND 15 OF PUBLIC LAW 600, APPROVED AUGUST 2, 1946, 60 STAT. 809 AND 810, PROVIDE:

SEC. 12. THE HEAD OF ANY DEPARTMENT MAY DELEGATE TO SUBORDINATE OFFICIALS (1) THE POWER VESTED IN HIM BY LAW TO TAKE FINAL ACTION ON MATTERS PERTAINING TO THE EMPLOYMENT, DIRECTION, AND GENERAL ADMINISTRATION OF PERSONNEL UNDER HIS DEPARTMENT; (2) THE AUTHORITY VESTED IN HIM BY SECTION 3683 OF THE REVISED STATUTES (31 U.S.C. 675) TO DIRECT THE PURCHASE OF ARTICLES FROM CONTINGENT FUNDS; AND (3) THE AUTHORITY VESTED IN HIM BY SECTION 3828, REVISED STATUTES (44 U.S.C. 324), TO AUTHORIZE THE PUBLICATION OF ADVERTISEMENTS, NOTICES OR PROPOSALS.

SEC. 15. THE HEAD OF ANY DEPARTMENT, WHEN AUTHORIZED IN AN APPROPRIATION OR OTHER ACT, MAY PROCURE THE TEMPORARY (NOT IN EXCESS OF ONE YEAR) OR INTERMITTENT SERVICES OF EXPERTS OR CONSULTANTS OR ORGANIZATIONS THEREOF, INCLUDING STENOGRAPHIC REPORTING SERVICES, BY CONTRACT, AND IN SUCH CASES SUCH SERVICE SHALL BE WITHOUT REGARD TO THE CIVIL-SERVICE AND CLASSIFICATION LAWS (BUT AS TO AGENCIES SUBJECT TO THE CLASSIFICATION ACT AT RATES NOT IN EXCESS OF THE PER DIEM EQUIVALENT OF THE HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT, UNLESS OTHER RATES ARE SPECIFICALLY PROVIDED IN THE APPROPRIATION OR OTHER LAW) AND, EXCEPT, IN THE CASE OF STENOGRAPHIC REPORTING SERVICES BY ORGANIZATIONS, WITHOUT REGARD TO SECTION 3709, REVISED STATUTES, AS AMENDED BY THIS ACT.

IT SHOULD BE/NOTED THAT THE APPLICATION OF THE PROVISIONS OF SECTION 15, SUPRA, IS DEPENDENT UPON THE EXISTENCE OF AN AUTHORIZATION IN AN APPROPRIATION OR OTHER ACT. UNLESS LIMITED BY SUCH AUTHORIZATION OR OTHERWISE, IT MAY BE STATED, GENERALLY, THAT WHEN SUCH AUTHORIZATION IS GIVEN, THE AUTHORITY OF THE HEAD OF A DEPARTMENT TO PROCURE BY CONTRACT THE TEMPORARY OR INTERMITTENT SERVICES OF EXPERTS OR CONSULTANTS OR ORGANIZATIONS THEREOF INCLUDING STENOGRAPHIC REPORTING SERVICES ESSENTIALLY IS A POWER PERTAINING TO THE EMPLOYMENT OF PERSONNEL WITHIN THE MEANING OF SECTION 12, SUPRA, WHICH ORDINARILY COULD BE DELEGATED BY THE HEAD OF A DEPARTMENT TO ONE OR MORE SUBORDINATE OFFICIALS UNDER AUTHORITY CONTAINED IN THAT SECTION. YOUR FIRST QUESTION IS ANSWERED ACCORDINGLY.

THERE IS NOTHING IN THE WORDING OF SECTION 15, OR IN ITS LEGISLATIVE HISTORY, WHICH WOULD WARRANT A CONCLUSION THAT THE HIGHEST RATE PAYABLE FOR THE SERVICES COVERED BY THAT SECTION IS LIMITED TO THE HIGHEST RATE PAYABLE FOR SIMILAR SERVICES UNDER THE CLASSIFICATION ACT. THEREFORE, PART (A) OF YOUR SECOND QUESTION IS ANSWERED IN THE AFFIRMATIVE. HOWEVER, IT SHOULD BE NOTED THAT, FOR REASONS STATED IN THE ANSWER TO PART (B) OF YOUR SECOND QUESTION, THIS LIMITATION IS NOT APPLICABLE TO CONTRACTS FOR STENOGRAPHIC REPORTING SERVICES.

UNDER SECTION 15 OF PUBLIC LAW 600 A CONTRACT FOR STENOGRAPHIC REPORTING SERVICES MAY BE OBTAINED ONLY AFTER THE SOLICITATION OF COMPETITIVE BIDS PURSUANT TO THE REQUIREMENTS OF SECTION 3709, REVISED STATUTES, THE CONTRACT TO BE AWARDED TO THE LOWEST QUALIFIED BIDDER. A CONTRACT SO AWARDED ALTHOUGH ESSENTIALLY A CONTRACT FOR THE EMPLOYMENT OF PERSONNEL WITHIN THE MEANING OF SECTION 12, SUPRA, IS NOT A CONTRACT FOR THE PERSONAL SERVICES OF AN INDIVIDUAL SELECTED BY THE GOVERNMENT ON THE BASIS OF ABILITY AND QUALIFICATIONS BUT IS A CONTRACT FOR THE FURNISHING OF A COMPLETED PRODUCT, I.E., A TRANSCRIPT OF TESTIMONY, ETC. SEE 6 COMP. GEN. 430.

IT WAS HELD IN DECISION OF SEPTEMBER 12, 1946, B-60354, 26 COMP. GEN. 188 (QUOTING FROM THE SYLLABUS):

THE MAXIMUM COMPENSATION LIMITATION PRESCRIBED BY SECTION 15 OF THE ADMINISTRATIVE EXPENSE ACT OF AUGUST 2, 1946, PROVIDING FOR THE PROCUREMENT OF OTHERWISE AUTHORIZED PERSONAL SERVICES BY CONTRACT, IS NOT FOR APPLICATION IN THE CASE OF FIRMS OR ORGANIZATIONS WHEN THE SERVICE CONTRACTED FOR CLEARLY IS OF NONPERSONAL NATURE, BUT, RATHER, IS FOR APPLICATION EXCLUSIVELY TO THE TYPE OF INDIVIDUAL SERVICES OF A PURELY PERSONAL NATURE CONTEMPLATED BY THE CLASSIFICATION ACT.

THAT HOLDING IS APPLICABLE TO A CONTRACT FOR STENOGRAPHIC REPORTING SERVICES AWARDED IN ACCORDANCE WITH THE PROCEDURE REQUIRED BY SECTION 3709, REVISED STATUTES, WHICH, AS PREVIOUSLY STATED, IS NOT A CONTRACT FOR PERSONAL SERVICES BUT, RATHER, ONE FOR THE PERFORMANCE OF A SERVICE NONPERSONAL IN NATURE. PART (B) OF YOUR SECOND QUESTION IS ANSWERED IN THE NEGATIVE.