B-101877, MARCH 23, 1951, 30 COMP. GEN. 384

B-101877, MARCH 23, 1951, 30 COMP. GEN. 384

CONTRACTS - FOREIGN PRODUCTS - AVAILABILITY OF DOMESTIC PRODUCTS UNDER THE PROVISIONS OF SECTION 2 OF THE BUY AMERICAN ACT OF 1933, AS AMENDED, PROHIBITING THE PURCHASE OF ARTICLES, MATERIALS, OR SUPPLIES WHICH ARE NOT MINED, PRODUCED, OR MANUFACTURED IN THE UNITED STATES, A CONTRACT MAY NOT BE AWARDED FOR THE DELIVERY OF PILLOWS STIPULATED TO BE MADE FROM ORIENTAL DUCK DOWN AND FEATHERS, WHEN BIDS HAVE ALSO BEEN RECEIVED OFFERING TO FURNISH PILLOWS MADE FROM DOMESTIC DOWN AND FEATHERS AT REASONABLE PRICES, IN THE ABSENCE OF AN ADMINISTRATIVE DETERMINATION THAT THE PURCHASE OF THE DOMESTIC PRODUCT WOULD BE INCONSISTENT WITH THE PUBLIC INTEREST.

COMPTROLLER GENERAL WARREN TO THE ADMINISTRATOR OF VETERANS AFFAIRS, MARCH 23, 1951:

REFERENCE IS MADE TO YOUR LETTER DATED MARCH 6, 1951, WITH ENCLOSURES, REQUESTING A DECISION AS TO WHETHER THERE MAY BE CONSIDERED THE BID OF THE SANITARY FEATHER AND DOWN COMPANY, INC., IN THE AWARD OF A CONTRACT FOR THE FURNISHING OF DUCK FEATHER PILLOWS TO THE VETERANS ADMINISTRATION.

IN RESPONSE TO INVITATION NO. T-68, DATED JANUARY 9, 1951, ISSUED BY THE VETERANS ADMINISTRATION, THE SANITARY FEATHER AND DOWN COMPANY, INC., SUBMITTED A BID OFFERING TO FURNISH THE PILLOWS WITH THE STIPULATION THAT THEY WERE TO BE MADE FROM ORIENTAL DUCK DOWN AND ORIENTAL DUCK FEATHERS. CONSEQUENTLY, IN VIEW OF THE PROHIBITION CONTAINED IN THE BUY AMERICAN ACT OF 1933, 47 STAT. 1520, AGAINST THE PURCHASE OF FOREIGN PRODUCTS, AND SINCE PARAGRAPH 14 OF THE GENERAL CONDITIONS OF THE INVITATION SPECIFICALLY SETS OUT SUCH PROHIBITION, THE QUESTION IS PRESENTED IN YOUR LETTER AS TO WHETHER THAT COMPANY'S BID MAY BE CONSIDERED IN AWARDING THE CONTRACT FOR THE REQUIRED PILLOWS.

SECTION 2 OF THE BUY AMERICAN ACT OF 1933, 47 STAT. 1520, PROVIDES:

NOTWITHSTANDING ANY OTHER PROVISION OF LAW, AND UNLESS THE HEAD OF THE DEPARTMENT OR INDEPENDENT CONCERNED SHALL DETERMINE IT TO BE INCONSISTENT WITH THE PUBLIC INTEREST, OR THE COST TO BE UNREASONABLE, ONLY SUCH UNMANUFACTURED ARTICLES, MATERIALS, AND SUPPLIES AS HAVE BEEN MINED OR PRODUCED IN THE UNITED STATES, AND ONLY SUCH MANUFACTURED ARTICLES, MATERIALS, AND SUPPLIES AS HAVE BEEN MANUFACTURED IN THE UNITED STATES SUBSTANTIALLY ALL FROM ARTICLES, MATERIALS, OR SUPPLIES MINED, PRODUCED, OR MANUFACTURED, AS THE CASE MAY BE, IN THE UNITED STATES, SHALL BE ACQUIRED FOR PUBLIC USE. THIS SECTION SHALL NOT APPLY WITH RESPECT TO ARTICLES, MATERIALS, OR SUPPLIES FOR USE OUTSIDE THE UNITED STATES, OR IF ARTICLES, MATERIALS, OR SUPPLIES OF THE CLASS OR KIND TO BE USED OR THE ARTICLES, MATERIALS, OR SUPPLIES FROM WHICH THEY ARE MANUFACTURED ARE NOT MINED, PRODUCED, OR MANUFACTURED, AS THE CASE MAY BE, IN THE UNITED STATES IN SUFFICIENT AND REASONABLY AVAILABLE COMMERCIAL QUANTITIES AND OF A SATISFACTORY QUALITY.

THE SAID ACT WAS AMENDED BY SECTION 633 OF THE NATIONAL MILITARY ESTABLISHMENT APPROPRIATION ACT, 1950, 63 STAT. 987, 1024, WHICH PROVIDES:

SEC. 633. IN ORDER TO CLARIFY THE ORIGINAL INTENT OF CONGRESS, HEREAFTER, SECTION 2 AND THAT PART OF SECTION 3 (A) PRECEDING THE WORDS "PROVIDED, HOWEVER," OF TITLE III OF THE ACT OF MARCH 3, 1933 (47 STAT. 1520), SHALL BE REGARDED AS REQUIRING THE PURCHASE, FOR PUBLIC USE WITHIN THE UNITED STATES, OF ARTICLES, MATERIALS, OR SUPPLIES MANUFACTURED IN THE UNITED STATES IN SUFFICIENT AND REASONABLY AVAILABLE COMMERCIAL QUANTITIES AND OF A SATISFACTORY QUALITY, UNLESS THE HEAD OF THE DEPARTMENT OR INDEPENDENT ESTABLISHMENT CONCERNED SHALL DETERMINE THEIR PURCHASE TO BE INCONSISTENT WITH THE PUBLIC INTEREST OR THEIR COST TO BE UNREASONABLE.

SECTION 201 (A) (1) OF THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949, 63 STAT. 377, 384, AUTHORIZES THE ADMINISTRATOR OF GENERAL SERVICES TO PRESCRIBE POLICIES AND METHODS OF PROCUREMENT OF SUPPLIES FOR THE CIVILIAN AGENCIES. IN CONNECTION WITH THE PREFERENCE REQUIRED TO BE GIVEN DOMESTIC PRODUCTS, THE BUREAU OF FEDERAL SUPPLY, TREASURY DEPARTMENT, ISSUED CIRCULAR LETTER B-61, DATED OCTOBER 1, 1947, WHICH, ACCORDING TO LETTER DATED NOVEMBER 18, 1950, FROM THE ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, TO THE DIRECTOR, SUPPLY SERVICE, VETERANS ADMINISTRATION, IS STILL IN EFFECT. IT IS PROVIDED IN THE SAID CIRCULAR LETTER OF OCTOBER 1, 1947, THAT IN APPLYING THE EXCEPTION SET FORTH IN THE BUY AMERICAN ACT OF 1933, PURCHASES OF PRODUCTS OF FOREIGN ORIGIN ARE PERMISSIBLE IF THE COST OF DOMESTIC PRODUCTS IS UNREASONABLE; THAT WHERE THE COST OF THE FOREIGN PRODUCT EXCEEDS, $100, A DIFFERENTIAL OF 25 PERCENT SHOULD BE APPLIED BY EXECUTIVE DEPARTMENTS AND INDEPENDENT ESTABLISHMENTS IN FAVOR OF DOMESTIC PRODUCTS TO BE DELIVERED IN THE CONTINENTAL UNITED STATES; THAT THE COST OF THE DOMESTIC PRODUCT IS CONSIDERED UNREASONABLE WHENEVER IT EXCEEDS THE COST OF THE FOREIGN PRODUCT INCLUDING DUTY PLUS THE AMOUNT OF THE DIFFERENTIAL; AND THAT IN APPROPRIATE CASES, THE HEADS OF THE DEPARTMENTS OR INDEPENDENT ESTABLISHMENTS CONCERNED MAY DETERMINE THAT THE PUBLIC INTEREST IS INCONSISTENT WITH THE PURCHASE OF A DOMESTIC PRODUCT, FOR ANY REASON OTHER THAN THE COMPARATIVE COST OF A FOREIGN PRODUCT.

AN EXAMINATION OF THE BIDS RECEIVED UNDER THE INVITATION--- SUBSEQUENTLY FURNISHED BY YOUR ADMINISTRATION--- SHOWS THAT THERE WERE OFFERED FOR DELIVERY PILLOWS MANUFACTURED FROM DOMESTIC DOWN AND FEATHERS. THUS, IT IS INDICATED THAT THE MATERIAL REQUIRED IN THE MANUFACTURE OF THE PILLOWS ARE AVAILABLE IN THE UNITED STATES IN SUFFICIENT QUANTITIES FROM COMMERCIAL SOURCES. FURTHERMORE, A COMPARISON OF THE BIDS SHOWS THAT PILLOWS MADE FROM DOMESTIC FEATHERS AND DOWN MAY BE PROCURED AT PRICES WELL WITHIN THE PRESCRIBED 25 PERCENT DIFFERENTIAL. THUS, IN THE ABSENCE OF PROPER DETERMINATION BY YOU THAT THE PURCHASE OF THE PILLOWS MANUFACTURED FROM DOMESTIC DOWN AND FEATHERS WOULD BE INCONSISTENT WITH THE PUBLIC INTEREST, YOU ARE ADVISED THAT THE BID OF THE SANITARY FEATHER AND DOWN COMPANY, INC., SHOULD BE DISREGARDED IN THE AWARD OF A CONTRACT UNDER THE INVITATION INVOLVED.