Mr. BROOKS. Oh, of course, it is better to admit that there was an error made and that we have received this and we ought to pay for it, and it was done because-and then explain who told him to do it in violation of the order. But then the GSA in Washington would know who had erred; it would have been much better to do it on an honest basis like that and say what happened. If there was an honest mistake, admit it. Nobody is foolproof. But to deliberately advertise in the name of the Federal Government that you are going to ask for bids to install these lights when they are already installed is just fraud, because everybody who comes and looks at them and sees they are already there says, "How do I bid on them? Who owns them? Do I I have to take these out and put mine in ?" There was a question in this bid, wasn't there, Mr. Warren, as to whether a bidder would be responsible for removing those excellent, new, fine partitions that were already installed? Mr. WARREN. Yes, sir, the specifications Mr. BROOKS. Were vague on that point? Mr. WARREN. As issued. But I believe that was brought up, according to Mr. O'Brien, I think Mr. Jay said that if he was low bidder they would make him take out the partitions make them take them out. He thought that the requirement was in the specifications that they would have to take them out. Mr. BROOKS. At the bid opening on December 29 there were only two bids received. I would like to put in the record a copy of the abstract of bids dated December 31, which shows that the Henges Co. bid $5,793.50, and that the E. F. Hauserman Co. bid $9,003. I notice carbon copies were sent to nine different people, several of whom were associated with you. (The material referred to is as follows:) GENERAL SERVICES ADMINISTRATION PUBLIC BUILDINGS SERVICE 2306 East Bannister Road KANSAS CITY, MO. ABSTRACT OF BIDS DECEMBER 31, 1959. The following bids were opened December 29, 1959, for new, movable partitions at the Commodity Stabilization Service Building, Kansas City, Mo., PB-JO60071: Henges Co., Inc., of Kansas City, Kansas City, Mo_. -$5,793. 60 9, 300.00 (Copies to bidder, custodian, Mr. Lacy, Mr. Rankin, Mr. Jay, Mr. Hankins, Mr. Dods, Mr. Jones, Mr. Mastrovich. Mr. BROOKS. You ordinarily get copies of the abstract yourself? Mr. WARREN. Yes, sir. I didn't get a copy of the abstract itself because I told the Services Branch that this was Mr. Lund's baby, and I wanted all the papers to go to him. Mr. BROOKS. What happened following this bid opening? Mr. WARREN. When the bid was opened the specifications came back, they were reviewed and when they were reviewed by the Schedule and Services Branch, which I did not take any note of, particularly, they were sent to the regional counsel's office as are all other contracts from the Design and Construction Division in a routine manner. They went to the regional counsel's office. He gave an opinion on the contract in writing on a memorandum slip, and returned it to the Design and Construction Division. Mr. BROOKS. Were you supposed to sign this contract as contracting officer? Mr. WARREN. Yes, I was supposed to. Mr. BROOKS. Did you? Mr. WARREN. No, sir. Mr. BROOKS. What was Mr. Jay's reaction to this? Mr. WARREN. Mr. Jay's reaction was one of exasperation and irritation when I went in and told Mr. Lund that I thought Mr. Lund should sign it. Mr. BROOKS. At this meeting did Mr. Jay indicate that he had directed Mr. Lund to issue the invitation on the open market? Mr. WARREN. After we had talked on it for some time, Mr. Jay said that he would like to explain it, and I said, "Sir, I personally, if you care to explain it, all right, but I want to remain out of it." But he insisted. He said that he specifically gave detailed instructions to Mr. Lund how to do it. And my reply was, "Sir, even if you did, it was still a bumbling direction and that it compounded an embarrassment that had already existed, and it would be embarrassing to GSA and was not good public policy." That was the position I took. Mr. BROOKS. Following this conference Mr. WARREN. That was before the contract was-I believe that was before the contract was mailed out to the contractor. I am not sure. Mr. BROOKS. Following this conference with Mr. Jay, and Lund, apparently, did Mr. Lund sign the contract? Mr. WARREN. Yes, sir. Mr. BROOKS. Was it sent to the regional counsel for approval? Mr. WARREN. As I said before, in a routine way, in a routine manner it went to Mr. BROOKS. What did General Counsel for GSA think about it? Mr. WARREN. As I recall, he turned it down for legal sufficiency, and he stated that the-I think, on his buckslip, he stated that it was a contract to do something which had already been done. Something to that effect. I have forgotten the exact words. Mr. BROOKS. I have a copy of that memo dated January 14, 1960, on a regular routing slip, directed to the Design and Construction Division from the regional counsel. With regard to contract PB-JO 60071, it says: Returned without our approval for legal sufficiency is contract PB-JO 60071 for new movable partitions for Commodity Stabilization Service Building as we are informally advised that there will be no work performed by the contractor under said contract. Accordingly, such does violence to competitive bidding, in our opinion. The initials "JLH" appear at the bottom, and apparently stand for James L. Horn Bostel, regional counsel. Counsel evidently sent the contract to you after rejecting it. Did you agree with his ruling? Mr. WARREN. Yes, sir. Before he made his ruling I had warned him of the situation, as I told you before. Mr. BROOKS. What happened after this contract was rejected by the chief counsel for region 6, after he said it was not proper? Mr. WARREN. All I know is that it created quite a stir in the office apparently, and that there was a meeting held, I am told, by people who attended with Mr. Jay, Mr. Lund, Mr. Horn Bostel, Mr. Stacy, Comptroller, Mr. Otto Huntington, Mr. Samuel Pines of the General Accounting Office, and an associate of his, in which they discussed this specific problem that they had. Mr. BROOKS. Did the GAO-that is, the General Accounting Office-representative suggest that he would not audit if it was documented with a covering memo? Mr. WARREN. I am told that they all concurred that it would not be audited after it was filed. You would have to establish that through facts with somebody else. Mr. BROOKS. We will get that established because I am sure that Mr. Campbell, who is now serving in I believe his fifth year as the Comptroller and as head of the General Accounting Office, will want to know, because he has 10 years to go on a 16-year term, and he is interested in the facts. People who are sure, the GAO won't look into and audit activities of the Federal Government, are taking a pretty big order for themselves. I believe Mr. Campbell is dedicated to auditing any of these agencies in which he thinks there is a discrepancy. I think in fairness to him we ought to point that out. I don't know what his agent out here said but I am sure Mr. Campbell will want to discuss it with him. If he said that, I don't know how long he will be Mr. Campbell's agent. We have a copy of that covering memorandum to file.1 It is dated January 26, 1960, from the regional director, Public Building Service, on the subject "Commodity Stabilization Service, Kansas City, Mo.," the same contract number. That is PB-JO 60071. Are you familiar with this? Mr. WARREN. Yes, sir. That was sent back. It was in the file and I read it. Mr. BROOKS. In this memorandum Mr. Lund presents what I gather are the facts of the case but there seem to be a couple of omissions. A couple of points concern you. I wish you would give me some comment in general on this memo. Do you want to take a look at it? Mr. WARREN. Inasmuch as my name was taken in vain in the matter, I immediately sat down and wrote a memorandum from my memory. The only comment I think the most pertinent comment that I would make in connection with that is that I made that memorandum immediately after I read it, and I believe it was on January 26 that I made it. I said: It is a strange story indeed, that no one ordered, directed, or authorized the installation of the partitions. That the contractor came to the building, located where they were to be placed, detailed his parts list, transported them to the building, installed them without knowledge of the custodial force, the building manager, the area manager, the operations officer of the reigonal office, chief of the buildings management division, director of the Public Building Service, and the Commissioner. The contractor, according to the statement, was only contacted twice. Once when he was alleged to have made a verabal agreement with some unknown person, and another time when, while the work was in progress, he was advised that he was doing the work at his own risk. 1 See appendix, exhibit 12, for letter of Apr. 7. 1960, from Hon. Joseph Campbell, Comptroller General of United States, and Hon. Jack Brooks. I have a long dissertation in which I don't think you will be interested. Mr. BROOKS. We have a copy which we will put in the record. That seems a quite frank analysis of the situation. (The material referred to is as follows:) [Confidential file] RE REGIONAL DIRECTOR, PBS, MEMORADUM TO THE FILE DATED JANUARY 26, 1960, ON COMMODITY STABILIZATION SERVICE, KANSAS CITY, Mo.-PB-JO 60071 This document, in my opinion, shows a classical example of how a master of duplicity can become so hypnotized by his own cleverness that he convicts himself completely of lying and at the same time confesses to conspiracy. It is a strange story indeed that no one ordered, directed, or authorized the installation of the partitions. That the contractor came to the building located where they were to be placed, detailed his parts list, transported them to the building, installed them without the knowledge of the custodial force, building manager, area manager, operations officer of regional office, Chief of Buildings Management Division, Director of PBS, the Commissioner. The contractor was only contacted twice. Once when he was alleged to have made a verbal agree ment with some unknown person and another time when while the work was in progress he was advised that he was "doing the work at his own risk." The consummate ignorance demonstrated and the display of moronic memory make a story that could only be told by an idiot or a liar. I do not believe that "the regional counsel suggested that the entire matter be documented, attached to the contract for file and that no further action be taken." Tennyson said "that a little which is half a truth is ever the blackest of lies." I did not say that, "because of the explicit directions which had been given to him as to the preparation of the specifications," was the reason I did not want to sign the contract but rather that plus other minute instructions on how the manner of handling the matter I felt that Mr. Lund was obligated to sign it or give me a written memo directive to sign it. I did say that I thought the way it was being handled it compounded an embarrassment already committed. That it did not show good faith and was bad for GSA-I used euphemistic terms because Mr. Jay and Mr. Lund were with much difficulty and without much success attempting to restrain their anger with me when I told them I did not want to sign the contract. I really thought the whole matter stunk with the air of favoritism and fraud. I put the whole lie to the statement that I, "did indicate generally that the technical provisions were very loose in permitting almost anyone to submit a bid"; my whole life is a contradiction of this statement. Mr. BROOKS. Specifically, this memo of Mr. Lund dated January 26, after mentioning the counsel's rejection of the contract, said it was not normal procedure for the regional director to sign the contract, but, it says: Mr. Ralph Warren, Chief of D. & C. Division, had indicated in conference that he did not prefer to sign this contract because of the explicit directions which had been given to him as to the preparation of specifications. * * * Is that true? Mr. WARREN. Sir Mr. BROOKS. Was that your reason? Mr. WARREN. I am reluctant to put the lie to anybody. But I put the lie to that. Mr. BROOKS. It is not true? Mr. WARREN. No, sir. Mr. BROOKS. It says: He was unable to point out specifically his objection to the specifications, but did indicate generally that the technical provisions were very loose in permitting almost anyone to submit a bid. * * * Is that a true statement? Mr. WARREN. That is a malicious falsehood fabrication. Mr. BROOKS. It goes on to say: It was pointed out to him that it had been intended to make the specifications as wide open as possible to assure as much competition as possible, but that if he did not prefer to sign the contract, he could prepare it for the signature of the regional director, PBS. *** Is that correct? Mr. WARREN. No, sir. I stated previously my reasons that I thought that he should sign the contract, that I did not want to. Mr. BROOKS. Will you give us anything else that you think pertinent on this particular subject? Mr. WARREN. At that conference I was astounded because while we were talking Mr. Jay was present. I endeavored to bring to Mr. Jay's attention the conduct of Mr. Lund, which I thought Mr. Jay should know about. And that was in the relations of the Bateson Co., contractors for the Federal Office Building at Omaha. I was reprimanded, rather severely, by Mr. Jay. He said, "This is the third time that you have complained about Mr. Lund in my presence." It took me back. I wondered if I had a complaint where in the world did he want me to make it? To his back? The third time. I think I have entered into the record the three occasions in which I have complained of Mr. Lund's conduct in the presence of Mr. Jay. It seems to be very displeasing to Mr. Jay. Mr. BROOKS. That you don't agree with Mr. Lund? Mr. WARREN. Let me withdraw "seems." It definitely was displeasing because it was immediately after that I was told in their anger they rushed and contacted Washington to enter the old circuitous route of ride me out in the closing days of my career. Mr. BROOKS. Mr. Wallhauser? Mr. WALLHAUSER. Outside of the procedure that you object to, do you agree or not agree that the price of $5,893.96 for the partitions was a reasonably good price? Mr. WARREN. I think my statement was that it was not an unreasonable price. I could not certify exactly to its reasonableness because I had not-no one in our office had made a detailed estimate of the work involved. Mr. WALLHAUSER. But based on your experience? Mr. WARREN. Basically speaking, so much footage, so many dollars per square foot, and knowing that type of partition, it was not an unreasonable price; I would say that. Mr. BROOKS. Thank you. We have some general matters I would like to have your opinion on. We have had brought to our attention the problem of possible discrimination. Do you remember a Mr. Elmer McDowell? Mr. WARREN. Yes, sir. Mr. BROOKS. Could you fill us in on this problem, just what happened in regard to his employment? Mr. WARREN. Mr. McDowell came to my office with his 57- Mr. WARREN. A form 57. That is an application for employment with the Government [continuing] seeking employment. I examined his 57 rather thoroughly, talked to him for a little while, and he impressed me very much, particularly his background, his experience |