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Question: What is the total amount of money Federal officials
spend each year on their own certificate?
We have reason to believe that the great majority of
expenditures accounted for on certificates are made by the
Central Intelligence Agency. The Central Intelligence Agency
does not presently make the amount of such expenditures avail
able to us.
Accordingly, we are unable to provide the total
amount of money Federal officials spend on their own certificates
Have there been cases in which GAO's ability to make
audits and other studies has been hampered or limited by problems
concerning access to records of unvouchered expenditures?
These problems usually arise in connection
with audits of intelligence activities, for which the majority
of expenditures accounted for by certificate are probably made.
Another area that poses difficulty is that of Presidential funds.
A recent example is the refusal by White House officials to allow
GAO access to records of certified expenditures during a settlement
audit of White House accounts requested by the Counsel to the President.
6. Question: Would GAO recommend that Congress make clear by law that
GAO is to have access to records of all expenditures, whether
they are accounted for by voucher or by certificate?
Such a measure could help us be of assistance
to the congress by helping it to determine what these funds
were actually expended for and to assure that the funds
expended by a department or establishment and accounted for
solely on the certificate or approval of the head thereof
are actually used for the purposes for which they were
authorized and appropriated.
Senator METCALF. I have a statement on S. 2268 from the National Security Industrial Association. I will put it in the record at this point, and instruct the staff to provide you with a copy of that statement, and if you want to respond to any of the things in there, you: may.
[The prepared statement of the National Security Industrial Association on S. 2268 follows:]
The National Security industrial Association welcomes the opportunity to submit for the record its views on certain aspects of s. 2268, "General Accounting Office Act of 1975".
NSIA is a non-profit association of approximately 250 American industrial and research companies of various types and sizes, from large to small, representing all segments of defense industry in every part of the United States. Its function is to promote an effective working relationship and effective two-way communications between government, primarily Defense and NASA, and the industry which supports it.
NSIA is concerned with three Titles to this Bill which, in NSIA's view give the General Accounting Office unnecessary and inappropriate additional duties and rights. These Titles are:
TITLE I ENFORCEMENT OF DECISIONS AND SETTLEMENT
With respect to Title I Enforcement of Decisions and Settlements,
.". We are concerned that this language is broad enough to authorize the Comptroller General to institute suit to seek the reversal of decisions of the Boards of Contract Appeals adverse to the Government, thus in effect nullifying the decision of the U.S. Supreme Court in S & E Contractors, Inc. v. United States, 406 U.S. 1 (1972). We understand that this is not the intent of the language and Section 320 (a) would seem to lend support to that position. Nevertheless, we feel that the language of Sections 320 (a) or (b) should be modified in order to avoid any question and to make clear that the Comptroller General does not have authority to challenge the finality of decisions of the Boards of Contract Appeals under Section 320 (b).
There is another circumstance arising out of the provisions of Section 320 which we feel should be brought to the attention of this Subcommittee and that relates to the power of the Comptroller General over the payments to a contractor after the award of a contract. As we understand Section 320 (b), it would primarily grant the GAO the power to stop the award of a contract if it appeared to be illegal. We are familiar with the "Bid Protest" procedure of the GAO which is invoked when a bidder feels that an error has been committed on the part of the Contracting Governmental Agency. Where this procedure is invoked, the apparent successful bidder is, of course, disappointed, but no funds have been expended nor commitments made by the bidder. The delay in the award or the nonaward of the contract may have a minimal effect on the bidder. However, such is not the case after the award of the contract and performance is commenced.
Under Section 320 (b) the Comptroller General may challenge the legality of an awarded contract by seeking declaratory relief in a United States District Court. On the filing of such an action the contractor is forced into a dilemma Should he continue to perform in face of such a challenge? If the contractor elects not to perform, pending resolution of the suit, and the award is sustained, then he is, in all probability, hopelessly in default and faced with the loss of all sums expended and costs of reprocurement which may be assessed. On the other hand if the contractor elects to continue performance and the award is overturned or not sustained, the recovery of the contractor's costs of performance is uncertain.
In view of such circumstances, we urge the Subcommittee to modify this Bill to require the procuring agency to direct the contractor to either cease performance or to proceed with the contract. Such direction should come within a reasonable time after the filing of the suit by the GAO. When the litigation is finally settled by a Court of competent jurisdiction the Bill