B-63107, JULY 15, 1949, 29 COMP. GEN. 21

B-63107: Jul 15, 1949

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414.68 WAS TO THE CONTRACTOR AND THAT EXCEPTIONS IN THE TOTAL AMOUNT OF $2. 241.18 WERE STATED AGAINST VOUCHERS IN THE ACCOUNTS OF CAPTAIN K. THESE EXCEPTIONS WERE BASED UPON THE PROPOSITION THAT THE AMOUNT ALLOWABLE FOR EACH MONTH'S RENTAL FOR EACH VEHICLE COULD NOT EXCEED ONE TWELFTH OF THE STATUTORY LIMITATION ON THE PURCHASE PRICE OF SUCH VEHICLE. ALTHOUGH IT IS NOT DEFINITELY SO STATED IN THE RECORD. IT IS ASSUMED THAT THE GOVERNMENT HAS RETAINED POSSESSION OF THE VEHICLES AND. OR ANY BRANCH OF THE GOVERNMENT SERVICE "UNLESS SPECIFIC AUTHORITY IS GIVEN THEREFOR.'. IT IS STATED: * * * WHILE THE ACT OF JULY 16. THE PURCHASE PRICE OF MOTOR-PROPELLED PASSENGER-CARRYING VEHICLES WAS LIMITED TO $1.

B-63107, JULY 15, 1949, 29 COMP. GEN. 21

VEHICLES - PASSENGER-CARRYING - RENTAL AND PURCHASE LIMITATIONS PAYMENTS UNDER A CONTRACT FOR THE RENTAL OF PASSENGER-CARRYING VEHICLES WHICH PROVIDED THAT TITLE TO THE VEHICLES WOULD VEST IN THE GOVERNMENT WHEN THE TOTAL RENTAL PAID EQUALS THE VALUE THEREOF, AND THAT, UPON COMPLETION AND TERMINATION OF THE CONTRACT, THE GOVERNMENT MAY PURCHASE THE VEHICLES BY PAYING THE DIFFERENCE BETWEEN THE STATED VALUE AND THE RENTALS THERETOFORE PAID, MAY NOT BE IN AN AMOUNT IN EXCESS OF THE PURCHASE PRICE LIMITATION FIXED BY STATUTE, PLUS THE COST OF TRANSPORTATION. 21 COMP. GEN. 548, DISTINGUISHED.

COMPTROLLER GENERAL WARREN TO LT. COL. F. A. FERGUSON, DEPARTMENT OF THE ARMY, JULY 15, 1949:

THERE HAS BEEN RECEIVED BY REFERENCE FROM THE OFFICE OF THE CHIEF OF ENGINEERS YOUR LETTER OF OCTOBER 25, 1948, REQUESTING REVIEW OF THE ACTION TAKEN BY THE AUDIT DIVISION OF THE GENERAL ACCOUNTING OFFICE IN WITHHOLDING CREDIT FOR PAYMENTS TO GREGO BUICK COMPANY, UNDER CONTRACT W- 22-052-ENG-1015, FOR RENTAL AND RECAPTURE OF TWO BUICK SEDANS OF AMOUNTS WHICH IN THE AGGREGATE EXCEED THE STATUTORY LIMITATION OF $1,300 EACH ON THE PURCHASE PRICE OF PASSENGER-CARRYING VEHICLES.

THE CONTRACT PROVIDES GENERALLY FOR THE HIRE TO THE GOVERNMENT OF TWO NEW 1946-51 BUICK SEDANS IN CONSIDERATION OF PAYMENTS OF $220 PER MONTH EACH. THE SPECIFICATIONS ATTACHED TO AND MADE A PART OF THE CONTRACT PROVIDE IN ARTICLE 11 FOR THE VESTING OF TITLE TO THE VEHICLES IN THE GOVERNMENT WHEN AND IF THE TOTAL RENTAL PAID TO THE CONTRACTOR SHALL EQUAL THE STATED VALUE OF THE VEHICLES ($2,207.34 EACH) AND THAT, UPON COMPLETION OR TERMINATION OF THE CONTRACT, THE GOVERNMENT MAY PURCHASE THE VEHICLES BY PAYING THE DIFFERENCE BETWEEN THE STATED VALUE AND THE TOTAL RENTALS THERETOFORE PAID.

THE RECORD INDICATES THAT A TOTAL OF $4,414.68 WAS TO THE CONTRACTOR AND THAT EXCEPTIONS IN THE TOTAL AMOUNT OF $2,241.18 WERE STATED AGAINST VOUCHERS IN THE ACCOUNTS OF CAPTAIN K. E. MACLAUGHLIN, AND IN THE TOTAL AMOUNT OF $1,682.51, AGAINST VOUCHERS IN YOUR ACCOUNTS. THESE EXCEPTIONS WERE BASED UPON THE PROPOSITION THAT THE AMOUNT ALLOWABLE FOR EACH MONTH'S RENTAL FOR EACH VEHICLE COULD NOT EXCEED ONE TWELFTH OF THE STATUTORY LIMITATION ON THE PURCHASE PRICE OF SUCH VEHICLE. HOWEVER, ALTHOUGH IT IS NOT DEFINITELY SO STATED IN THE RECORD, IT IS ASSUMED THAT THE GOVERNMENT HAS RETAINED POSSESSION OF THE VEHICLES AND, ON THAT BASIS, FOR REASONS HEREINAFTER SET FORTH, THERE MAY BE ALLOWED OF THE RENTAL PAID FOR EACH VEHICLE ONLY $1,300, PLUS THE AMOUNT REQUIRED FOR TRANSPORTATION.

SECTION 5 OF THE ACT OF JULY 16, 1914, 38 STAT. 508, PROVIDES THAT NO APPROPRIATION IN THAT OR ANY OTHER ACT SHALL BE AVAILABLE FOR THE PURCHASE OF ANY MOTOR-PROPELLED OR HORSE-DRAWN PASSENGER-CARRYING VEHICLE FOR THE SERVICE OF ANY OF THE EXECUTIVE DEPARTMENTS OR OTHER GOVERNMENT ESTABLISHMENTS, OR ANY BRANCH OF THE GOVERNMENT SERVICE "UNLESS SPECIFIC AUTHORITY IS GIVEN THEREFOR.'

IN A DECISION RENDERED JANUARY 19, 1915, 21 COMP. DEC. 462, IT IS STATED:

* * * WHILE THE ACT OF JULY 16, 1914, SUPRA, SPEAKS IN TERMS OF THE PURCHASE OF AUTOMOBILES, YET TO HOLD THAT AN AUTOMOBILE MAY BE HIRED BY THE MONTH OR BY THE YEAR WOULD BE AN EVASION OF THE LAW AND WOULD NULLIFY IT, INASMUCH AS EVERYONE WHO COULD NOT PURCHASE A MACHINE MIGHT ACCOMPLISH THE SAME PURPOSE BY HIRING IT.

SEE, ALSO, 21 ID. 560. THIS CONSTRUCTION OF THE STATUTE HAS BEEN ADHERED TO IN MANY DECISIONS OF THIS OFFICE, SUCH AS 4 COMP. GEN. 836; 14 ID. 325, 16 ID. 95. FURTHER, THE MATTER HAS BEEN CLARIFIED BY SECTION 16 (A) OF THE ACT OF AUGUST 2, 1946, 60 STAT. 810, WHICH AMENDED THE 1914 ACT TO PROHIBIT THE EXPENDITURE OF APPROPRIATE FUNDS TO "PURCHASE OR HIRE PASSENGER MOTOR VEHICLES" EXCEPT AS AUTHORIZED THEREIN.

THE WAR DEPARTMENT CIVIL APPROPRIATION ACT, 1947, APPROVED MAY 2, 1946, 60 STAT. 163, CONTAINS THE APPROPRIATION CHARGED WITH THE EXPENDITURES HERE INVOLVED," FLOOD CONTROL, MISSISSIPPI RIVER AND TRIBUTARIES," WHICH PROVIDES FOR "THE PURCHASE IN THE FISCAL YEAR 1947 OF NOT TO EXCEED ONE HUNDRED AND SIXTEEN MOTOR-PROPELLED PASSENGER CARRYING VEHICLES.' SECTION 202 OF THE ACT OF MARCH 28, 1946, 60 STAT. 79, THE PURCHASE PRICE OF MOTOR-PROPELLED PASSENGER-CARRYING VEHICLES WAS LIMITED TO $1,050, WHICH WAS INCREASED TO $1,300 BY SECTION 406 OF THE ACT OF JULY 23, 1946, 60 STAT. 632, WHICH AMOUNT SHALL BE IN ADDITION TO THE AMOUNT REQUIRED FOR TRANSPORTATION.

IT IS STATED IN YOUR LETTER THAT THE ONLY MEANS OF OBTAINING THE NEEDED EQUIPMENT FOR USE IN INSPECTION BY THE PRESIDENT, MISSISSIPPI RIVER COMMISSION, AND THE DIVISION ENGINEER, LOWER MISSISSIPPI VALLEY DIVISION, OF VERY IMPORTANT FLOOD CONTROL INSTALLATIONS AND CONSTRUCTION PROJECTS WAS THROUGH RENTAL OF THE EQUIPMENT; THAT THERE WAS AN ACUTE SHORTAGE OF AUTOMOBILES AVAILABLE FOR PURCHASE; THAT ONLY ONE RESPONSIVE BID WAS RECEIVED TO AN INVITATION FOR BIDS TO BE OPENED JULY 8, 1946; AND THAT UPON READVERTISING WITH A RECAPTURED PROVISION IN THE INVITATION ONLY ONE BID WAS RECEIVED WHICH WAS ACCEPTED AND CONTRACT W-22-052-ENG-1015 WAS EXECUTED.

IT MUST BE ASSUMED THAT THE SHORTAGE OF PASSENGER-CARRYING VEHICLES WHICH EXISTED IN 1946 WAS KNOWN TO THE CONGRESS WHEN IT CONSIDERED THE LIMITATIONS TO BE PLACED ON THE PURCHASE PRICE OF AUTOMOBILES AND THAT CONGRESS KNEW, OR SHOULD HAVE BEEN INFORMED, OF THE NEED FOR AUTOMOBILES BY THE CORPS OF ENGINEERS WHEN IT MADE THE PROVISION FOR 116 PASSENGER- CARRYING VEHICLES IN THE APPROPRIATION HERE INVOLVED.

BE THAT AS IT MAY, THIS OFFICE HAS THE DUTY OF DECIDING WHETHER AN APPROPRIATION IS AVAILABLE FOR MAKING PAYMENT ON THE BASIS OF THE RECORD AS PRESENTED. IT MAY BE STATED THAT THE QUESTION WITH WHICH THE ACCOUNTING OFFICERS ARE CONCERNED IS NOT THE APPARENT GENERAL MERIT OF LIMITATIONS ON THE EXPENDITURE OF APPROPRIATED FUNDS BUT WHETHER AN INDIVIDUAL PAYMENT OR A SERIES OF PAYMENTS IS WITHIN SUCH LIMITATION SINCE IT IS FOR THE CONGRESS TO SAY HOW AND ON WHAT CONDITIONS PUBLIC MONEY SHALL BE SPENT. CF. 18 COMP. GEN. 285.

THEREFORE, SINCE THE EVASION OF THE STATUTORY LIMITATION ON THE PURCHASE PRICE OF PASSENGER-CARRYING VEHICLES BY RENTAL OF SUCH VEHICLES WAS PROHIBITED BY RULE OF THE ACCOUNTING OFFICERS PRIOR TO AUGUST 2, 1946, AND BY STATUTE THEREAFTER, IT MUST BE HELD THAT THE APPROPRIATION IS NOT AVAILABLE FOR PAYMENTS UNDER THE CITED CONTRACT IN EXCESS OF THE STATUTORY LIMITATION OF $1,300 FOR EACH VEHICLE, PLUS THE COST OF TRANSPORTATION.

THE EXCEPTIONS, THEREFORE, WILL BE RESTATED TO WITHHOLD CREDIT FOR ALL PAYMENTS MADE AFTER PAYMENTS WITH RESPECT TO EACH VEHICLE AMOUNTED TO $1,300, SUBJECT TO ADJUSTMENT UPON RECEIPT OF INFORMATION AS TO THE COST OF THE TRANSPORTATION OF EACH VEHICLE.

WITH REFERENCE TO THE RULE ENUNCIATED IN 21 COMP. GEN. 548, THAT IN THE EXERCISE OF THE RECAPTURE PROVISION IN A RENTAL AGREEMENT UNDER A COST- PLUS-A-FIXED-FEE CONTRACT IT IS NOT REQUIRED THAT RENTALS PREVIOUSLY PAID BY THE CONTRACTOR BE CONSIDERED AS PART OF THE PURCHASE PRICE, IT MAY BE STATED THAT THIS DECISION HAS NO APPLICATION TO A SITUATION SUCH AS EXISTS HERE WHERE THE RENTAL, AS SUCH, IS UNAUTHORIZED. FURTHERMORE, THE RENTAL PAID IN THAT CASE DID NOT EXCEED THE STATUTORY LIMITATION ON THE PURCHASE PRICE OF AUTOMOBILES.