B-97718 October 9, 1950

B-97718: Oct 9, 1950

Additional Materials:

Contact:

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

 

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

Requesting a decision as to whether the third paragraph thereof concerning the renewal and termination of the contract is proper for the inclusion in an agreement of this kind. It is assumed that there is only one source of supply so that the proposal to have the contract renewed annually for an indefinite period would not be repugnant to the advertising for bid requirements of section 3709.

B-97718 October 9, 1950

The Honorable The Postmaster General

My dear Mr. Postmaster General:

There has been received your letter of August 25, 1950, reference 15, transmitting a proposed form of agreement with public transportation companies for the conveyance of carriers in the City Delivery Service, and requesting a decision as to whether the third paragraph thereof concerning the renewal and termination of the contract is proper for the inclusion in an agreement of this kind. The paragraph reads as follows:

"This agreement shall be for a term beginning on , and ending June 30, 1951, subject to termination at any time on 30 days' written notice given by either party to the other. Unless so terminated, this agreement shall be renewed annually for successive one-year terms commencing July of each year, subject to the availability of appropriations and subject to termination during any such term as provided above."

The provision of the contract quoted above providing, in part, that, unless terminated by a 30-day written notice on the part of either party, the "agreement shall be renewed annually for successive one-year terms commencing July 1 of each year, subject to the availability of appropriations" would require affirmative action on the part of the authorized contracting officer to continue the contract beyond the fiscal year for which executed and the renewal would be subject to the availability of an appropriation. Hence, the proposed contract would not appear to come within the provisions of section 3732, Revised Statutes, 41, U.S.C. 11, or of section 3679, Revised Statutes, 31 U.S.C. 665, as amended by section 1211 of the General Appropriation act, 1951, approved September 6, 1950, Public Law 759, prohibiting, in effect, the involvement of the Government in any contract or obligation beyond the extent or availability of existing appropriations unless authorized by law. Cf. 28 Comp. Gen. 553; 29 id. 91; 29 id. 451. Also, since the proposed contract would be with a public transportation company, it is assumed that there is only one source of supply so that the proposal to have the contract renewed annually for an indefinite period would not be repugnant to the advertising for bid requirements of section 3709, Revised Statutes, as amended. Cf. 28 Comp. Gen. 553.

Accordingly, this Office would not be required to object to payments under a contract of the Post Office Department with a public transportation company for the conveyance of city delivery carriers which included the proposed provision.

Sincerely yours,

(Signed) LINDSAY C. WARREN Comptroller General of the United States