B-73347, MARCH 22, 1948, 27 COMP. GEN. 540

B-73347, MARCH 22, 1948, 27 COMP. GEN. 540

EXCHANGE OR SALE OF USED EQUIPMENT THE AUTHORIZATION IN SECTION 8 OF THE ADMINISTRATIVE EXPENSE STATUTE OF AUGUST 2, 1946, TO EXCHANGE OR SELL "SIMILAR ITEMS" AND APPLY THE EXCHANGE ALLOWANCES OR SALE PROCEEDS TO THE PURCHASE PRICE OF REPLACEMENT EQUIPMENT, DOES NOT CONSTITUTE AUTHORITY FOR THE PUBLIC ROADS ADMINISTRATION TO CLASSIFY AS ROAD-BUILDING EQUIPMENT VARIOUS TYPES OF CONSTRUCTION AND MAINTENANCE EQUIPMENT USED IN ROAD CONSTRUCTION, SUCH AS TRUCKS, TRACTORS, ETC., SO THAT THE PROCEEDS OF SALE OF ANY ONE TYPE OF EQUIPMENT WOULD BE AVAILABLE FOR APPLICATION AGAINST THE PURCHASE OF ANY OTHER TYPE OF EQUIPMENT SO CLASSIFIED.

COMPTROLLER GENERAL WARREN TO THE FEDERAL WORKS ADMINISTRATOR, MARCH 22, 1948:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 2, 1948, RELATIVE TO A PROPOSAL THAT THE PUBLIC ROADS ADMINISTRATION BE PERMITTED TO CONSIDER ALL ITS CONSTRUCTION AND MAINTENANCE EQUIPMENT--- TRUCKS, TRACTORS, XTRAXCAVATORS, DOZERS, SCRAPERS, GRADERS, SHOVELS, ETC.--- WHICH IS USED EXCLUSIVELY FOR BUILDING AND MAINTAINING ROADS AND BRIDGES AS "ROAD BUILDING EQUIPMENT," SO THAT THE PROCEEDS FROM THE SALE OF ANY ONE OR MORE PIECES OF SUCH EQUIPMENT, OR THE EXCHANGE VALUE THEREOF, MAY BE APPLIED TOWARD THE PURCHASE OF ANY ITEM OF NEW EQUIPMENT UNDER SECTION 8 OF THE ACT OF AUGUST 2, 1946, 60 STAT. 808, 809.

SAID SECTION 8 PROVIDES AS FOLLOWS:

IN PURCHASING MOTOR-PROPELLED OR ANIMAL-DRAWN VEHICLES OR TRACTORS, OR ROAD, AGRICULTURAL, OR LABORATORY EQUIPMENT, OR BOATS, OR PARTS, ACCESSORIES, TIRES, OR EQUIPMENT THEREOF, OR ANY OTHER ARTICLE OR ITEM THE EXCHANGE OF WHICH IS AUTHORIZED BY LAW, THE HEAD OF ANY DEPARTMENT OF HIS DULY AUTHORIZED REPRESENTATIVE MAY EXCHANGE OR SELL SIMILAR ITEMS AND APPLY THE EXCHANGE ALLOWANCES OR PROCEEDS OF SALES IN SUCH CASES IN WHOLE OR IN PART PAYMENT THEREFOR: PROVIDED, THAT ANY TRANSACTION CARRIED OUT UNDER THE AUTHORITY OF THIS SECTION SHALL BE EVIDENCED IN WRITING.

THERE ARE SET FORTH IN YOUR LETTER VARIOUS CONTENTIONS WHICH ARE SUMMARIZED BY YOU AS FOLLOWS:

TRACTORS ARE USED TO TOW OR PUSH VARIOUS TYPES OF ROAD CONSTRUCTION EQUIPMENT. DOZERS ARE USED FOR DIGGING, PUSHING, DUMPING AND SPREADING. SCRAPERS ARE USED FOR DIGGING, LOADING, HAULING, DUMPING AND SPREADING. GRADERS ARE USED FOR LEVELING, SHAPING, MIXING, SPREADING, AND SLOPING. SHOVELS, DRAGLINES AND CLAMSHELLS ARE USED FOR EXCAVATION, CLEARING, STRIPPING, SLOPING, TRENCHING, LOADING ETC. DUMP TRUCKS ARE USED TO HAUL AND DUMP MATERIALS, OR TO HAUL AND SPREAD MATERIALS. ALSO, YOU CONTEND THAT THE TITLE BY WHICH AN ARTICLE IS KNOWN--- "SHOVEL," "TRUCK," ,BOAT," ETC.--- SHOULD NOT BE THE GOVERNING FACTOR, BUT RATHER, THAT THE USE OF THE ARTICLE SHOULD GOVERN AND, THEREFORE, THAT ALL CONSTRUCTION AND MAINTENANCE EQUIPMENT USED FOR ROAD-BUILDING PURPOSES SHOULD BE CLASSIFIED AS " ROAD BUILDING EQUIPMENT" BECAUSE EACH TYPE OF MACHINE IS USED FOR SO MANY KINDS OF WORK AND BECAUSE IT IT IMPOSSIBLE TO DRAW A LINE DECIDING, FOR INSTANCE, THE EXCAVATING EQUIPMENT FROM THE EARTH-MOVING EQUIPMENT.

AS AN EXAMPLE, YOU CITE THE FOLLOWING:

FOR ROAD-BUILDING PURPOSES SCRAPERS, GRADERS, DOZERS, SHOVELS, AND TRUCKS ARE CONSIDERED EARTH-MOVING EQUIPMENT. TRACTORS OFTEN COMPOSE A PART OF THESE EARTH-MOVING MACHINES SINCE THEY ARE USED TO TOW OR PUSH THE PIECES OF EQUIPMENT. IN THE PAST TWO YEARS THE PUBLIC ROAD ADMINISTRATION HAS SOLD SEVERAL SHOVELS WHICH HAD OUTLIVED THEIR USEFULNESS. SEVERAL THOUSANDS OF DOLLARS WERE RECEIVED FOR THEM BUT IT HAS BEEN IMPOSSIBLE TO REPLACE THEM WITH SHOVELS. THE PUBLIC ROAD ADMINISTRATION IS, HOWEVER, PURCHASING OTHER EARTH-MOVING EQUIPMENT AND IT APPEARS TO US THAT IT WOULD BE WITHIN THE INTENT OF THE LAW TO APPLY THE PROCEEDS FROM THE SALE OF THE SHOVELS TOWARD THE PURCHASE OF THIS EQUIPMENT WHICH SERVES THE SAME GENERAL PURPOSE. THAT IS, IT APPEARS TO US THAT THE PROCEEDS FROM THE SALE OF A SHOVEL COULD PROPERLY BE APPLIED TOWARD THE PURCHASE OF A DOZER SINCE BOTH ARE EARTH-MOVING EQUIPMENT. LIKEWISE, SINCE A DOZER IS USED FOR SPREADING MATERIAL AS WELL AS MOVING IT, IT APPEARS THAT IT WOULD BE EQUALLY PROPER TO APPLY THE PROCEEDS FROM THE SALE OF A DOZER TOWARD THE PURCHASE OF A SPREADER. OR, SINCE A DOZER IS USED FOR EXCAVATING DITCHES IT WOULD SEEM THAT THE PROCEEDS FROM ITS SALE MIGHT BE USED IN PART PAYMENT FOR A DITCHING MACHINE OR A GRADER, BOTH OF WHICH MAY BE USED FOR THE SAME PURPOSE.

YOUR LETTER STATES THAT YOU ARE AWARE OF THE DECISION, 23 COMP. GEN. 931, CONSTRUING THE PROVISIONS OF SECTION 203 OF THE INDEPENDENT OFFICES APPROPRIATION ACT, 1944, 57 STAT. 195--- SIMILAR TO SECTION 8 OF PUBLIC LAW 600--- AND, WHILE SAID DECISION HAS BEEN FOLLOWED HERETOFORE, YOU REQUEST THAT THE HOLDING BE MODIFIED INSOFAR AS IT AFFECTS THE TRANSACTIONS OF THE PUBLIC ROADS ADMINISTRATION.

THE SAID DECISION HELD (QUOTING FROM THE SYLLABUS) AS FOLLOWS:

THE AUTHORIZATION IN SECTION 203 OF THE INDEPENDENT APPROPRIATION ACT, 1944, TO EXCHANGE OR SELL "SIMILAR" USED ITEMS WHEN PURCHASING EQUIPMENT OF THE TYPES SPECIFIED THEREIN AND TO APPLY THE EXCHANGE ALLOWANCE OR SALE PROCEEDS TO THE PURCHASE PRICE DOES NOT CONSTITUTE AUTHORITY TO INTERMINGLE THE VARIOUS CATEGORIES OF SPECIFIED ITEMS; RATHER, THE EQUIPMENT TO BE EXCHANGED OR SOLD AND THAT PURCHASE MUST BE OF THE SAME OR EQUIVALENT GENERAL CHARACTER, THAT IS, ONLY A TRUCK MAY BE SOLD OR EXCHANGED IN PAYMENT FOR A TRUCK, A BOAT FOR A BOAT, ETC.

THE AUTHORITY GRANTED IN SECTION 8 OF PUBLIC LAW 600 IS INTENDED FOR USE BY DEPARTMENTS IN THE PURCHASE OF ITEMS WHICH ARE TO BE USED IN REPLACEMENT OF OLD EQUIPMENT. AND THE AUTHORITY EXTENDS ONLY TO THE EXCHANGE OR SALE OF "SIMILAR ITEMS.' UNDER THE PROPOSAL OUTLINED IN YOUR LETTER THE INDIVIDUAL ITEMS OF EQUIPMENT WOULD FOR ALL INTENTS AND PURPOSES LOSE THEIR INDIVIDUAL IDENTITIES FOR THE PURPOSE OF INVOKING THE AUTHORITY GRANTED UNDER SECTION 8 OF PUBLIC LAW 600. A TRUCK WOULD NOT BE CLASSES AS A TRUCK, A GRADER WOULD NOT BE CLASSED AS A GRADER, A TRACTOR WOULD NOT BE CONSIDERED A TRACTOR, ETC., BUT ALL SUCH EQUIPMENT WOULD BE THROWN INTO THE GENERAL CATEGORY OF " ROAD BUILDING EQUIPMENT," SO THAT ACTUALLY THE PROCEEDS OF SALE OF ANY ONE OF THE VARIOUS TYPES OF EQUIPMENT ENUMERATED IN YOUR LETTER WOULD BE AVAILABLE FOR APPLICATION AGAINST THE PURCHASE OF ANY OTHER TYPE OF EQUIPMENT.

I DO NOT FEEL THAT THE INTERMINGLING OF VARIOUS TYPES OF EQUIPMENT RELATED ONLY BY USE IN A GENERAL ACTIVITY SUCH AS ROAD BUILDING AND THE CLASSIFICATION THEREOF UNDER ONE BROAD HEADING, IS COMPREHENDED IN THE TERM "SIMILAR ITEMS" AS CONTAINED IN SECTION 8 OF PUBLIC LAW 600. INTERPRETATION OF THE TERM SUCH AS CONTENDED FOR WOULD GO FAR AFIELD OF THE ORIGINAL INTENDMENT OF THE STATUTE. ACCORDINGLY, I HAVE TO ADVISE THAT THIS OFFICE MAY NOT ACQUIESCE IN THE MODIFICATION OF THE HOLDING IN 23 COMP. GEN. 931, TO THE EXTENT PROPOSED.

FURTHERMORE, IN VIEW OF THE STATEMENT CONTAINED IN YOUR LETTER THAT:

* * * IN THE PAST TWO YEARS THE PUBLIC ROADS ADMINISTRATION HAS SOLD SEVERAL SHOVELS WHICH HAD OUTLIVED THEIR USEFULNESS. SEVERAL THOUSANDS OF DOLLARS WERE RECEIVED FOR THEM BUT IT HAS BEEN IMPOSSIBLE TO REPLACE THEM WITH MOVING EQUIPMENT AND IT APPEARS TO US THAT IT WOULD BE WITHIN THE INTENT OF THE LAW TO APPLY THE PROCEEDS FROM THE SALE OF THE SHOVELS TOWARD THE PURCHASE OF THIS EQUIPMENT WHICH SERVES THE SAME GENERAL PURPOSE. * * * THERE IS BROUGHT TO YOUR ATTENTION THE FACT THAT IT IS IN CONNECTION WITH THE PURCHASE OF MOTOR PROPELLED VEHICLES, ETC., THAT THERE IS PERMITTED THE APPLICATION OF THE PROCEEDS OF SALES OF OLD OR USED VEHICLES, ETC. THAT IS TO SAY, THERE MUST BE SOME ACTION TOWARDS THE PURCHASE, BY THE ISSUANCE OF AN ORDER OR REQUISITION, IF NOT THE ACTUAL CONSUMMATION OF THE PURCHASE BEFORE THE PROCEEDS OF THE SALE MAY BE APPLIED. SEE B-69713, DATED FEBRUARY 26, 1948, 27 COMP. GEN. 477. IN THE SITUATION DESCRIBED IN YOUR LETTER NO PURCHASE ACTION HAD BEEN ACCOMPLISHED AT THE TIME THE USED EQUIPMENT WAS SOLD; HENCE, IN THE ABSENCE OF SPECIFIC STATUTORY AUTHORITY THEREFOR, THE PROCEEDS OF SALE WOULD NOT APPEAR TO BE PRESENTLY AVAILABLE FOR APPLICATION AGAINST THE PURCHASE OF NEW SIMILAR EQUIPMENT.