B-77489, JUNE 28, 1948, 27 COMP. GEN. 782

B-77489: Jun 28, 1948

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THE SALES OF WHICH ARE TO BE CONSUMMATED IN A RESERVATION OVER WHICH THE GOVERNMENT HAS EXCLUSIVE JURISDICTION WITHIN A COUNTY OF THE STATE OF FLORIDA. 1948: I HAVE YOUR LETTER OF JUNE 15. IN VIEW OF THE FACT THAT THE PRICES QUOTED THEREIN ARE LESS THAN THE MINIMUM PRICES ESTABLISHED BY THE FLORIDA MILK COMMISSION FOR THE BAY COUNTY MILK MARKETING AREA IN WHICH THE SAID AIR FORCE BASE IS LOCATED. IT APPEARS THAT UPON THE SOLICITATION OF BIDS FOR FURNISHING STATED QUANTITIES OF PASTEURIZED MILK AND BUTTERMILK THREE BIDS WERE RECEIVED. THAT SUCH BID WAS CONTRARY TO FLORIDA LAW AND SHOULD BE REJECTED. THE QUESTION FOR DECISION IS WHETHER A STATE CAN PRESCRIBE A MINIMUM PRICE AT WHICH MILK MAY BE SOLD IN TERRITORY WITHIN THE EXCLUSIVE JURISDICTION OF THE UNITED STATES.

B-77489, JUNE 28, 1948, 27 COMP. GEN. 782

BIDS - REJECTION - STATE MINIMUM PRICE REGULATIONS A BID FOR THE FURNISHING OF MILK, THE SALES OF WHICH ARE TO BE CONSUMMATED IN A RESERVATION OVER WHICH THE GOVERNMENT HAS EXCLUSIVE JURISDICTION WITHIN A COUNTY OF THE STATE OF FLORIDA, NEED NOT BE REJECTED AS IN VIOLATION OF THE MINIMUM PRICE REGULATIONS OF THE FLORIDA MILK COMMISSION APPLICABLE TO THE COUNTY, THE REGULATIONS, PROMULGATED UNDER STATE LAW, BEING LEGALLY INAPPLICABLE TO SALES TO THE GOVERNMENT MADE WITHIN SUCH RESERVATION.

COMPTROLLER GENERAL WARREN TO CAPT. N. T. BLANCHETTE, U.S. AIR FORCE, JUNE 28, 1948:

I HAVE YOUR LETTER OF JUNE 15, 1948, REQUESTING A DECISION AS TO WHETHER THE LOW BID FOR FURNISHING MILK TO TYNDALL AIR FORCE BASE, PANAMA CITY, FLORIDA, DURING THE PERIOD FROM JULY 1 TO DECEMBER 31, 1948, MAY BE CONSIDERED IN MAKING AWARD, IN VIEW OF THE FACT THAT THE PRICES QUOTED THEREIN ARE LESS THAN THE MINIMUM PRICES ESTABLISHED BY THE FLORIDA MILK COMMISSION FOR THE BAY COUNTY MILK MARKETING AREA IN WHICH THE SAID AIR FORCE BASE IS LOCATED.

IT APPEARS THAT UPON THE SOLICITATION OF BIDS FOR FURNISHING STATED QUANTITIES OF PASTEURIZED MILK AND BUTTERMILK THREE BIDS WERE RECEIVED, TWO BIDDERS QUOTING PRICES OF 22 CENTS AND 16 CENTS PER QUART FOR PASTEURIZED MILK AND BUTTERMILK, RESPECTIVELY, THE ESTABLISHED MINIMUM PRICES AS AFORESAID; WHILE ONE BIDDER, F. C. WILSON, OWNER OF WILSON'S DAIRY, SUBMITTED THE LOW BID OF 20 CENTS AND 14 CENTS PER QUART FOR SAID ITEMS. IN A LETTER DATED JUNE 12, 1948, THE ADMINISTRATOR, FLORIDA MILK COMMISSION, STATED THAT IT HAD BEEN CALLED TO HIS ATTENTION THAT YOU HAD RECEIVED A BID BELOW THE PRICES ESTABLISHED BY THE COMMISSION IN OFFICIAL ORDER 37-H, ISSUED NOVEMBER 14, 1947, AND THAT SUCH BID WAS CONTRARY TO FLORIDA LAW AND SHOULD BE REJECTED.

THE QUESTION FOR DECISION IS WHETHER A STATE CAN PRESCRIBE A MINIMUM PRICE AT WHICH MILK MAY BE SOLD IN TERRITORY WITHIN THE EXCLUSIVE JURISDICTION OF THE UNITED STATES, IT HAVING BEEN ASCERTAINED INFORMALLY FROM THE DEPARTMENT OF THE ARMY THAT THE STATE OF FLORIDA, IN CEDING THE LAND ON WHICH TYNDALL AIR FORCE BASE IS LOCATED, HAS GIVEN TO THE UNITED STATES EXCLUSIVE JURISDICTION THEREOF, SUBJECT TO CERTAIN EXCEPTIONS NOT MATERIAL HERE.

THE SUPREME COURT OF THE UNITED STATES, IN A CASE INVOLVING FACTS SIMILAR TO THOSE HERE INVOLVED ( PACIFIC COAST DAIRY V. DEPARTMENT OF AGRICULTURE, 318 U.S. 285), HELD THAT THE STATE OF CALIFORNIA HAD NO JURISDICTION IN THE MATTER OF SALES IN TERRITORY OVER WHICH THE UNITED STATES HAS EXCLUSIVE JURISDICTION. IN OTHER WORDS, THE SUPREME COURT DECIDED THAT A MILK DEALER, SELLING MILK TO THE GOVERNMENT ON TERRITORY OVER WHICH THE UNITED STATES HAS EXCLUSIVE JURISDICTION, IS NOT GUILTY OF VIOLATION OF A STATE LAW REGULATING MILK SALES GENERALLY FOR THE REASON THAT THE SAID LAW IS NOT APPLICABLE IN SUCH A TERRITORY. HERE, AS IN THAT CASE, THE GOVERNMENT HAS EXCLUSIVE JURISDICTION OVER THE TERRITORY IN WHICH THE SALES ARE TO BE CONSUMMATED AND, THEREFORE, THE ORDERS OF THE FLORIDA MILK COMMISSION, ISSUED PURSUANT TO THE LAWS OF THE STATE OF FLORIDA AND REGULATING THE PRICES AT WHICH MILK IS TO BE SOLD IN BAY COUNTY, FLORIDA, ARE NOT APPLICABLE TO SALES OF MILK TO THE TYNDALL AIR FORCE BASE IN PANAMA CITY.

WITH REGARD TO THE STATEMENT BY THE CHAIRMAN OF THE FLORIDA MILK COMMISSION THAT THE LOW BIDDER HAS NOT COMPLIED WITH THE "REQUIREMENTS OF THE MILK CONTROL ACT, SUCH AS FURNISHING A CERTIFICATE OF INSPECTION, PAYMENT OF LICENSE FEES AND TAXES," THE MERE FACT THAT THE LOW BIDDER HAS NOT YET PAID WHATEVER TAXES AND LICENSE FEES ARE REQUIRED BY THE STATE AS A PREREQUISITE TO DOING BUSINESS IN BAY COUNTY IS NOT A SUFFICIENT EXCUSE FOR REJECTION OF HIS BID, IF OTHERWISE PROPER. SEE 19 COMP. GEN. 735.

ACCORDINGLY, THE PRESENT RECORD AFFORDS NO LEGAL BASIS FOR REJECTION OF THE BID OF F. C. WILSON.