B-167995, OCT. 3, 1969

B-167995, OCT. 3, 1969

BIDS--DISCARDING ALL BIDS--REINSTATEMENT--LOW BIDDER UNDER CANCELED INVITATION WHERE LOW BID FOR CHARTER FLIGHTS WAS REJECTED AND INVITATION CANCELED ON BASIS THAT 37 U.S.C. 801 (C), 18 U.S.C. 281 AND DEPARTMENTAL REGULATIONS IMPLEMENTING THOSE STATUTES PRECLUDED AWARD BECAUSE FIRM'S PRESIDENT, WHO SIGNED BID, WAS RETIRED REGULAR AIR FORCE OFFICER, FIRM'S CONTENTION THAT REJECTION WAS INCORRECT SINCE STATUTES APPLY TO SALE OF SUPPLIES AS OPPOSED TO SALE OF SERVICES WAS CORRECT AND NO COMPELLING REASON EXISTED FOR CANCELLATION OF INVITATION. GAO WOULD HAVE NO OBJECTION TO REINSTATING INVITATION FOR PURPOSE OF MAKING AWARD TO LOW BIDDER, AND EVEN IF FIRM WERE NOT CORRECT INSOFAR AS 37 U.S.C. 801 (C) IS CONCERNED, STATUTE WOULD NOT APPLY AS RETIRED PAY PROHIBITION LIMIT WAS 3 YEARS AND OFFICER RETIRED MORE THAN 3 YEARS PRIOR TO INVITATION. CRIMINAL LAW VIOLATIONS--NOT FOR GENERAL ACCOUNTING OFFICE CONSIDERATION WHETHER 18 U.S.C. 281 -- CRIMINAL STATUTE WHICH EXEMPTED RETIRED OFFICERS FROM ITS PROVISIONS BUT PROVIDED THAT NOTHING THEREIN SHOULD BE CONSTRUED AS ALLOWING ANY RETIRED OFFICER TO REPRESENT ANY PERSON IN SALE OF ANYTHING TO GOVERNMENT THROUGH DEPARTMENT IN WHOSE SERVICE HE HOLDS RETIRED STATUS -- SHOULD BE CONSTRUED AS NOT APPLICABLE WHERE CONTRACTS FOR PERFORMANCE OF SERVICES ARE CONCERNED, IS NOT WITHIN JURISDICTION OF GENERAL ACCOUNTING OFFICE WHO MAY NOT PROPERLY RENDER OPINION, SINCE QUESTION AS TO INTERPRETATION AND APPLICATION OF FEDERAL CRIMINAL STATUTES COME UNDER DEPARTMENT OF JUSTICE, AND UNTIL JUDICIALLY HELD OTHERWISE, GAO WILL ACCEPT ATTORNEY GENERAL'S OPINION AS TO PROPER INTERPRETATION AND APPLICATION OF STATUTE. RETIRED- CONTRACTING WITH GOVERNMENT--CONTRACT PROPRIETY STATUS OF RETIRED OFFICER NOT ON ACTIVE DUTY IS ESSENTIALLY THAT OF PRIVATE CITIZEN, AND IN ABSENCE OF STATUTORY PROHIBITION SUCH OFFICER IS NOT, IN OPINION OF GENERAL ACCOUNTING OFFICE, PRECLUDED FROM ENTERING INTO CONTRACTS WITH GOVERNMENT, BUT MILITARY DEPARTMENTS SHOULD NOT ENTER INTO CONTRACT WITH RETIRED REGULAR OFFICER WHEN SUCH ACTION COULD SUBJECT HIM TO PROVISIONS OF EITHER 37 U.S.C. 801 (C) OR 18 U.S.C. 281, ESSENTIAL PURPOSES OF WHICH ARE TO SAFEGUARD INTEGRITY OF PUBLIC ADMINISTRATION AND TO PREVENT GOVERNMENT OFFICIALS FROM USING THEIR POSITIONS AND INFLUENCE FOR PERSONAL GAIN.

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTER DATED SEPTEMBER 25, 1969, AFSPPOA, FROM COLONEL WILLIAM J. TIPTON, USAF, CHIEF, PROCUREMENT OPERATIONS DIVISION, DIR/PROCUREMENT POLICY, DCS/S-AND-L, REQUESTING A DECISION AS TO THE PROPRIETY OF AWARDING AN AIR FORCE CONTRACT TO A RETIRED REGULAR AIR FORCE OFFICER. A FILE OF DOCUMENTS COVERING A SPECIFIC CASE WAS ENCLOSED WITH A REQUEST FOR DECISION AS TO THE PROPRIETY OF MAKING AN AWARD IN THAT CASE.

THE STATUS OF A RETIRED OFFICER NOT ON ACTIVE DUTY IS ESSENTIALLY THAT OF A PRIVATE CITIZEN AND IN THE ABSENCE OF SOME STATUTORY PROHIBITION SUCH AN OFFICER IS NOT IN OUR OPINION PRECLUDED FROM ENTERING INTO CONTRACTS WITH THE GOVERNMENT. SEE 41 COMP. GEN. 784, 786. THE QUESTION IS PREDICATED ON THE PROVISIONS OF 5 U.S.C. 59C, 10 U.S.C. 6112, AND 18 U.S.C. 281 RELATING TO POST-RETIREMENT SALES ACTIVITIES OF RETIRED REGULAR OFFICERS.

THE PROVISIONS OF 5 U.S.C. 59C AND 10 U.S.C. 6112, AS AMENDED, NOW CODIFIED IN SECTION 801 (C) OF TITLE 37 OF THE U.S.C. PROHIBIT THE PAYMENT OF RETIRED PAY FOR A PERIOD OF THREE YEARS AFTER RETIREMENT TO AN OFFICER ON THE RETIRED LIST OF THE REGULAR ARMY, THE REGULAR NAVY, THE REGULAR AIR FORCE, THE REGULAR MARINE CORPS, THE REGULAR COAST GUARD, THE ENVIRONMENTAL SCIENCE SERVICES ADMINISTRATION, OR THE PUBLIC HEALTH SERVICE, WHO IS ENGAGED FOR HIMSELF OR OTHERS IN SELLING, OR CONTRACTING OR NEGOTIATING TO SELL, SUPPLIES OR WAR MATERIALS TO AN AGENCY OF THE DEPARTMENT OF DEFENSE, THE COAST GUARD, THE ENVIRONMENTAL SCIENCE SERVICES ADMINISTRATION, OR THE PUBLIC HEALTH SERVICE.

SECTION 281 OF TITLE 18 OF THE UNITED STATES, A CRIMINAL STATUTE, REPEALED BY SECTION 2 OF PUBLIC LAW 87-849, OCTOBER 23, 1962, 76 STAT. 1126, EXCEPT AS TO RETIRED OFFICERS OF THE ARMED FORCES, EXEMPTED RETIRED OFFICERS FROM ITS PROVISIONS BUT PROVIDED THAT NOTHING THEREIN SHALL BE CONSTRUED TO ALLOW ANY RETIRED OFFICER TO REPRESENT ANY PERSON IN THE SALE OF ANYTHING TO THE GOVERNMENT THROUGH THE DEPARTMENT IN WHOSE SERVICE HE HOLDS A RETIRED STATUS.

NOTING IN THE LETTER OF SEPTEMBER 25, 1969, THAT WE HELD IN 41 COMP. GEN. 677, THAT 5 U.S.C. 59C AND 10 U.S.C. 6112 HAVE NO APPLICATION WHERE CONTRACTS FOR THE PERFORMANCE OF SERVICES ARE CONCERNED, OUR OPINION IS REQUESTED AS TO WHETHER 18 U.S.C. 281 SHOULD BE SIMILARLY CONSTRUED. SINCE QUESTIONS AS TO THE INTERPRETATION AND APPLICATION OF THE FEDERAL CRIMINAL STATUTES ARE NOT WITHIN THE JURISDICTION OF THIS OFFICE BUT COME UNDER THE DEPARTMENT OF JUSTICE, WE PROPERLY MAY NOT RENDER AN OPINION ON THIS ASPECT OF THE MATTER. UNTIL JUDICIALLY HELD OTHERWISE WE WILL ACCEPT THE OPINION OF THE ATTORNEY GENERAL AS TO THE PROPER INTERPRETATION AND APPLICATION OF 18 U.S.C. 281 IN ANY PARTICULAR CASE.

THE ESSENTIAL PURPOSES OF THE CITED STATUTORY PROVISIONS ARE TO SAFEGUARD THE INTEGRITY OF PUBLIC ADMINISTRATION AND TO PREVENT GOVERNMENT OFFICIALS FROM USING THEIR POSITIONS AND INFLUENCE FOR PERSONAL GAIN. 39 COMP. GEN. 366, 368. IT IS OUR VIEW, THEREFORE, THAT THE MILITARY DEPARTMENTS SHOULD NOT ENTER INTO A CONTRACT WITH A RETIRED REGULAR OFFICER WHEN SUCH ACTION COULD SUBJECT HIM TO THE PROVISIONS OF EITHER 37 U.S.C. 801 (C) OR 18 U.S.C. 281.

AS TO THE PARTICULAR CASE INVOLVED, THE ENCLOSED FILE OF DOCUMENTS SHOWS THAT BY INVITATION FOR BIDS F04666-69-B-0973, ISSUED MAY 19, 1969, BIDS WERE SOLICITED FOR NONPERSONAL SERVICES TO PROVIDE CHARTER FLIGHTS FOR IN- FLIGHT TRACKING OF BALLOON BORNE INSTRUMENTATION SYSTEMS AT CHICO MUNICIPAL AIRPORT, CHICO, CALIFORNIA. IT WAS ESTIMATED THAT 400 HOURS OF FLYING TIME AND 20 OVERNIGHT MISSIONS WOULD BE REQUIRED. THIS WAS AN ADVERTISED PROCUREMENT WITH THE BIDS TO BE OPENED AT 2:00 P.M., PACIFIC DAYLIGHT STANDARD TIME, JUNE 10, 1969.

THE BID OF LAKE ALMANOR AVIATION WAS THE LOWEST BID MEETING THE ADVERTISED SPECIFICATIONS AND THIS CONCERN HAD RECEIVED THE AWARD UNDER TWO PRIOR INVITATIONS (1967 AND 1968). SINCE, HOWEVER, IT WAS LEARNED THAT THE PRESIDENT OF LAKE ALMANOR AVIATION WHO SIGNED THE BID WAS A RETIRED REGULAR AIR FORCE OFFICER, THE BID WAS REJECTED AND THE INVITATION WAS CANCELLED BECAUSE OF A CONSIDERATION THAT 37 U.S.C. 801 (C), 18 U.S.C. 281, AND THE DEPARTMENTAL REGULATIONS IMPLEMENTING THOSE STATUTES PRECLUDED THE AWARD OF A CONTRACT TO LAKE ALMANOR AVIATION.

THE PROCUREMENT WAS READVERTISED. LAKE ALMANOR AVIATION REFUSED TO BID ON THE READVERTISEMENT CONTENDING THAT THE REJECTION OF ITS BID ON IFB F04666-69-B-0973 WAS IN ERROR SINCE NEITHER 37 U.S.C. 801 (C) NOR 18 U.S.C. 281 APPLIES TO THE FURNISHING OF A SERVICE.

SINCE THE PROCUREMENT INVOLVED ONLY THE CHARTER HIRE OF AN AIRPLANE AND PILOT SERVICES LAKE ALMANOR AVIATION IS CLEARLY CORRECT INSOFAR AS 37 U.S.C. 801 (C) IS CONCERNED. 41 COMP. GEN. 677. EVEN IF SUCH WERE NOT THE CASE THE STATUTE WOULD NOT BE FOR APPLICATION TO THE PRESENT INVITATION. THE RETIRED PAY PROHIBITION OF THE STATUTE IS LIMITED TO A PERIOD OF THREE YEARS AFTER RETIREMENT AND THE AIR FORCE REGISTER SHOWS THAT THE OFFICER WHO SIGNED THE BID WAS RETIRED AUGUST 1965 OR MORE THAN THREE YEARS PRIOR TO ISSUANCE OF THE INVITATION FOR BIDS.

AS INDICATED ABOVE THE QUESTION OF THE APPLICATION OF 18 U.S.C. 281 IS FOR DETERMINATION BY THE ATTORNEY GENERAL AND NOT THIS OFFICE. IN THIS REGARD THE ENCLOSED FILE OF DOCUMENTS CONTAINS A COPY OF MEMORANDUM DATED AUGUST 29, 1969, OF A DISCUSSION BETWEEN AN AIR FORCE LEGAL OFFICER AND THE ASSISTANT UNITED STATES ATTORNEY, SACRAMENTO, CALIFORNIA. THIS MEMORANDUM INDICATES THAT THE DEPARTMENT OF JUSTICE DOES NOT INTEND TO INSTITUTE CRIMINAL PROCEEDINGS IN THIS CASE ON THE BASIS OF THE PRIOR CONTRACTS OR THE PRESENT BID. ALSO, THE MEMORANDUM SAYS THAT IT IS THE POSITION OF THE ASSISTANT UNITED STATES ATTORNEY THAT 18 U.S.C. 281 HAS REFERENCE TO THE SALE OF SUPPLIES AS OPPOSED TO THE SALE OF SERVICES. THE ASSUMPTION THAT THIS IS THE FINAL POSITION OF THE DEPARTMENT OF JUSTICE IN THE MATTER, IT WILL BE ACCEPTED BY THIS OFFICE.

WE ARE NOT AWARE OF ANY OTHER BASIS FOR OBJECTION TO AWARD OF THE CONTRACT TO LAKE ALMANOR AVIATION. SEE 25 COMP. GEN. 690.

IN SUCH CIRCUMSTANCES NO COMPELLING REASON EXISTED FOR CANCELLATION OF THE INVITATION AND WE WOULD HAVE NO OBJECTION IF IT BE ADMINISTRATIVELY DETERMINED TO REINSTATE THE INVITATION FOR THE PURPOSE OF MAKING AWARD TO LAKE ALMANOR AVIATION AS THE LOWEST RESPONSIBLE BIDDER. SEE 45 COMP. GEN. 357, 363.

THE FILE OF DOCUMENTS RECEIVED WITH THE LETTER OF SEPTEMBER 25, 1969, IS RETURNED.