B-171958, SEP 14, 1972
Highlights
THIS REQUEST AND THE CIRCUMSTANCES PROMPTING IT WERE THE SUBJECT OF OUR DECISION 51 COMP. THE FACTS OF WHICH WILL NOT BE REPEATED. WE AGREED WITH MERRIAM'S CONTENTION THAT GSA'S AWARD OF AN AGREEMENT TO LEASE TO GATEWAY WAS IMPROPER BECAUSE IT FAILED TO COMPLY WITH THE CRITERIA ADOPTED BY GSA TO IMPLEMENT AN APPROPRIATION ACT LIMITATION WHICH. PRECLUDED THE LEASE OF NEW CONSTRUCTION UNLESS THE CONSTRUCTION WAS ALREADY COMMITTED AS A PRIVATE VENTURE. WE ALSO RECOGNIZED THAT WE COULD NOT IGNORE GATEWAY'S SUBSTANTIAL CONSTRUCTION PROGRESS IN RELIANCE ON GSA'S ASSURANCES THAT IT COMPLIED WITH THE LIMITATION AND THE LIKELIHOOD THAT OTHER LESSORS WERE IN SIMILAR CIRCUMSTANCES. WE THEREFORE EXPRESSED THE VIEW THAT THE APPROPRIATE COURSE OF ACTION FOR OUR OFFICE TO TAKE WAS TO REFER THE MATTER TO THE CONGRESS FOR CORRECTIVE LEGISLATIVE ACTION.
B-171958, SEP 14, 1972
BID PROTEST - NEW CONSTRUCTION LEASING BY GSA DECISION DENYING THE REQUEST OF JOHN W. MERRIAM FOR GAO TO PRECLUDE GSA FROM ENTERING INTO A LEASE WITH THE GATEWAY CENTER CORPORATION. GAO CANNOT INTERVENE GSA IN THIS SITUATION BECAUSE CONGRESS ELIMINATED THE LIMITATION ON THE LEASING OF NEW CONSTRUCTION FROM THE APPROPRIATIONS ACT, AND SUBSTITUTED A REVISED PROCEDURE IN THE PUBLIC BUILDINGS AMENDMENTS OF 1972. (PUBLIC LAW 92-313).
TO STRADLEY, RONON, STEVENS & YOUNG:
WE REFER TO YOUR LETTER OF JULY 17, 1972, REQUESTING ON BEHALF OF JOHN W. MERRIAM THAT OUR OFFICE TAKE STEPS TO PRECLUDE THE GENERAL SERVICES ADMINISTRATION (GSA) FROM ENTERING INTO A LEASE WITH THE GATEWAY CENTER CORPORATION UNDER SOLICITATION FOR OFFERS NO. NEG(70) 63.
THIS REQUEST AND THE CIRCUMSTANCES PROMPTING IT WERE THE SUBJECT OF OUR DECISION 51 COMP. GEN. (B-171958, MARCH 17, 1972), THE FACTS OF WHICH WILL NOT BE REPEATED. IN THE DECISION, WE AGREED WITH MERRIAM'S CONTENTION THAT GSA'S AWARD OF AN AGREEMENT TO LEASE TO GATEWAY WAS IMPROPER BECAUSE IT FAILED TO COMPLY WITH THE CRITERIA ADOPTED BY GSA TO IMPLEMENT AN APPROPRIATION ACT LIMITATION WHICH, IN EFFECT, PRECLUDED THE LEASE OF NEW CONSTRUCTION UNLESS THE CONSTRUCTION WAS ALREADY COMMITTED AS A PRIVATE VENTURE. WE ALSO RECOGNIZED THAT WE COULD NOT IGNORE GATEWAY'S SUBSTANTIAL CONSTRUCTION PROGRESS IN RELIANCE ON GSA'S ASSURANCES THAT IT COMPLIED WITH THE LIMITATION AND THE LIKELIHOOD THAT OTHER LESSORS WERE IN SIMILAR CIRCUMSTANCES. WE THEREFORE EXPRESSED THE VIEW THAT THE APPROPRIATE COURSE OF ACTION FOR OUR OFFICE TO TAKE WAS TO REFER THE MATTER TO THE CONGRESS FOR CORRECTIVE LEGISLATIVE ACTION. HOWEVER, WE ADVISED THE ADMINISTRATOR OF GENERAL SERVICES THAT WE HAD NO ALTERNATIVE BUT TO RAISE OBJECTION TO ANY PAYMENTS UNDER LEASES EXECUTED AFTER OUR DECISION WITHOUT PROPER REGARD FOR THE THEN EXISTING APPROPRIATION LIMITATION "WHERE THE RESTRICTION IS OPERATIVE BOTH AT THE TIME OF LEASE EXECUTION AND AT THE TIME OF PAYMENT."
SUBSEQUENT TO OUR DECISION, THE CONGRESS ELIMINATED THE LIMITATION FROM THE INDEPENDENT OFFICES APPROPRIATION ACT. IN LIEU OF THE LIMITATION, A REVISED PROCEDURE REFLECTED IN THE PUBLIC BUILDINGS AMENDMENTS OF 1972 (PUBLIC LAW 92-313, JUNE 16, 1972, 86 STAT. 216) WAS ADOPTED. CONSEQUENTLY, NO FURTHER ACTION BY OUR OFFICE IS INDICATED.