Food Assistance: School Milk Contract Bid-Rigging
RCED-93-5
Published: Oct 16, 1992. Publicly Released: Nov 18, 1992.
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Highlights
Pursuant to a congressional request, GAO examined bid-rigging on school milk contracts, focusing on: (1) problems with agricultural laws or administration which allowed bid-rigging to occur; and (2) the possible influence of the Capper-Volstead Act on bid-rigging.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Agriculture | To enhance federal capabilities to identify and deter improper bid-rigging between dairy cooperatives, the Secretary of Agriculture and the Attorney General should develop a systematic process for coordinating and sharing information on dairy cooperatives suspected of illegal bidding on contracts. |
Closed – Implemented
USDA's Food and Nutrition Service and USDA's Capper-Volstead Act Committee are pursuing developing a more systematic process for sharing bid-rigging information with the Department of Justice.
|
| Department of Justice | To enhance federal capabilities to identify and deter improper bid-rigging between dairy cooperatives, the Secretary of Agriculture and the Attorney General should develop a systematic process for coordinating and sharing information on dairy cooperatives suspected of illegal bidding on contracts. |
Closed – Implemented
The Department of Justice is taking action to share information with USDA to deter bid-rigging activity. Specifically, DOJ will send monthly reports to USDA summarizing DOJ investigations and prosecutions involving the dairy industry.
|
| Department of Agriculture | With regard to individuals and companies convicted of or indicted for bid-rigging, the Secretary of Agriculture, as appropriate, should suspend or debar such individuals or companies from participating in school milk contracts or take other appropriate administrative action. |
Closed – Implemented
On July 21, 1993, USDA announced its first department action against a dairy that had been convicted of bid-rigging. USDA is currently reviewing several other cases for debarment.
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Topics
Agricultural programsAntitrust lawCollusionContractor debarmentDairy industryFarm income stabilization programsFood programs for childrenLaw enforcementMonopoliesPrice regulation