at the time-also may be performed by subcontractors if the interest of the Government so requires. Accordingly, whether a reduction should be made in the fixed fee originally agreed upon due to the fact that there was a further subcontracting of the work during the course of performing the contract is a question which properly may not be determined until the contract is completed and the extent of the subcontracting which actually took place is compared and considered in connection with the amount of further subcontracting which the parties contemplated might take place at the time the contract was negotiated, and with respect to which the fixed fee was originally agreed upon. Furthermore, the amount, if any, by which the prime contractor's fixed fee should be reduced by virtue of further subcontracting during the course of performing the contract is for determination in the first instance by the contracting officer or his authorized representative. However, in the performance of its statutory duty of auditing vouchers of disbursing officers covering expenditures of public moneys, it is a proper function of this office to inquire into the question as to whether the determination of the contracting officer with respect to the amount, if any, by which the prime contractor's fixed fee should be reduced as a result of further subcontracting during the course of performance is reasonable. Also, for use in considering the reasonableness of the contracting officer's determination in such cases, it is necessary that there be forwarded here a report showing what determination the contracting officer made in this respect and containing a statement of the facts on which such determination is based. When, upon such showing, it appears that the amount of the fixed fee as finally determined by the contracting officer to be proper for payment to the contractor-that is, as to whether and, if to what extent an adjustment in the amount of the fee as originally fixed is to be made-is reasonable on the basis of a comparison of the duties, responsibilities, etc., of the contractor under the contract as affected by the additional subcontracting, with its duties, responsibilities, etc., as contemplated at the time the fee was originally fixed, this office will not take exception to payments made in accordance with the contracting officer's determination in the matter. So, With respect to the instant matter, a final audit of the vouchers covering payments under the contract involved has not been made by this office as yet. However, if, as is understood from your letter, the entire amount of the fee fixed for payment to the prime contractor is well within the statutory limit of 6 percent and the amount thereof apportionable to the total cost of the work which was subcontracted does not exceed a reasonable allowance to the contractor as reimbursement of the expense of negotiating the subcontracts and supervising the work performed thereunder, this office would not object to the pay ment of the balance of the fixed fee now being withheld by your office without any reduction therein, if it be determined by the proper officials of your agency that no deduction is warranted under all of the facts and circumstances. It may be stated in this connection that the audit of vouchers covering the payments of fixed fees to prime contractors would be facilitated if care should be exercised in the negotiation of the prime contract to determine, insofar as is possible, what part of the contract work is to be performed by the prime contractor, what portion thereof definitely is to be subcontracted, and what portion thereof may be the subject of further subcontracting, and if there should be incorporated into the prime contract a provision setting forth the understanding of the parties in this regard and that the fee was fixed on such basis. Then, if during the course of performing the contract it develops that the subcontracting of further portions of the work would be in the interest of the United States-in that it would serve to expedite performance of the contract or would be more economical, or for some other reason— a report of such facts, together with the approval of the subcontracts by the contracting officer and a statement of the determination of said official as to what adjustment, if any, in the fixed fee should be made, and of the facts on which such determination is based, should be attached to the copy of the subcontract when forwarded to this office. (B-27164) ABSTRACTS OF TITLE-APPROPRIATION AVAILABILITY The cost of title evidence acquired after condemnation proceedings have been instituted by the Department of Justice in connection with the acquisition of land for the Navy Department for purposes authorized in section 201 of the Second War Powers Act, 1942, may be charged to the Navy Department appropriation available for acquiring the land, rather than to Department of Justice appropriations, where the title evidence is primarily or in the first instance for use by the Navy Department, in cooperation with the Department of Justice, in attempting to effect settlement with land owners by negotiation without proceeding to judgment in the condemnation proceedings. Comptroller General Warren to the Secretary of the Navy, July 10, 1942: I have your letter of July 2, 1942 (JAG: U: ALO'B: nn), as follows: To further expedite the prosecution of the war there was enacted by the 77th Congress Public Law No. 507. This law was approved March 27, 1942. Section 2 [201] thereof reads in part as follows: "The Secretary of War, the Secretary of the Navy, or any other officer, board, commission, or governmental corporation authorized by the President, may acquire by purchase, donation, or other means of transfer, or may cause proceedings to be instituted in any court having jurisdiction of such proceedings, to acquire by condemnation, any real property, temporary use thereof, or other interest therein, together with any personal property located thereon or used therewith, that shall be deemed necessary, for military, naval, or other war purposes, such proceedings to be in accordance with the Act of August 1, 1888 (25 Stat. 357), or any other applicable Federal statute, * * The acquisition of lands by the Navy Department in compliance with the above Act requires the purchase of preliminary Certificates or Abstracts of Title in order that the proper persons with whom to negotiate and from whom to obtain options and deeds can be ascertained. This title evidence is ordered under contracts with local title and abstract companies. Under authority of previous decisions of your office, this department now purchases title evidence on lands acquired by direct purchase, exchange, donation, or gift, but has not purchased title evidence in cases where land is acquired by condemnation pursuant to a Declaration of Taking (8 Comp. G. Dec. 308). By letter dated June 26, 1942, the Attorney General has requested the Navy Department to procure title evidence upon 68,666.89 acres of land in Bingham County, Idaho. This land was taken by the Navy Department in a condemnation proceeding pursuant to a Declaration of Taking filed April 29, 1942, in the United States District Court for the State of Idaho. In the program of the Navy Department to further expedite the prosecution of the war, regularly employed attorneys and commissioned officers work jointly with representatives of the Department of Justice in procuring settlement agreements after condemnation proceedings have been filed. Title evidence is necessary to the Navy Department after the Department of Justice has filed a petition in condemnation as such evidence is used by the attorneys of the Navy Department in determining with whom negotiations shall be conducted. In view of the request of the Attorney General, it becomes necessary to determine whether the Navy Department appropriations for the acquisition of land or appropriations for the contingencies connected therewith are available to pay for the purchase of title evidence after condemnation has been filed by the Department of Justice pursuant to the Declaration of Taking procedure provided by the Act of February 26, 1931 (46 Stat. 1422), where such title evidence purchased is for the joint use of the Navy Department and the Department of Justice. In the light of these conditions, your views are requested with respect to the question submitted in the preceding paragraph. Generally, the cost of procuring evidence of title for use in a pending land condemnation proceeding is regarded as part of the expenses of the proceeding and, therefore, is for payment out of the appropriations of the Department of Justice. 8 Comp. Gen. 308. In 21 Comp. Gen. 744, 746, the rules applicable in apportioning the cost of evidence of title in condemnation proceedings between the acquiring agency and the Department of Justice are summarized as follows: In the decision of December 18, 1928, of former Comptroller General McCarl, 8 Comp. Gen. 308, cited in your letter, there are discussed three different situations under which abstracts of title may be required, and the appropriations chargeable in each instance (1) where the abstracts are required prior to the institution of condemnation proceedings; (2) when they are required incident to and after the condemnation proceedings have been instituted; and (3) when required after the termination of the condemnation proceedings. With respect to (1) and (3) the decision holds that the appropriation available for the acquisition of the property is properly chargeable, but as to (2) it was held that the cost of such abstracts of title should be charged to the applicable appropriations of the Department of Justice. While there is nothing in Public Law 507, 56 Stat. 177, quoted in your letter, authorizing the handling of condemnation proceedings jointly by the Department of Justice and the Navy Department, the said law authorizes the Secretary of the Navy to cause proceedings to be instituted for the condemnation of property that shall be deemed necessary for naval or other war purposes; also, it is stated in your letter that in the program of the Navy Department to further expedite the prosecution of the war, regularly employed attorneys of the Navy Department and commissioned cfficers of the Navy work jointly with representatives of the Department of Justice in procuring settlement agreements after condemnation proceedings have been filed. It is stated further that after the Department of Justice has filed the petition in condemnation the title evidence is necessary for use by the Navy Department in determining with whom negotiations should be conducted. It is conceivable that it may be advisable even after the declaration of taking has been filed under the procedure provided by the act of February 26, 1931, cited in your letter, to negotiate with known owners of the land with a view to effecting final settleinent without proceeding to judgment in condemnation proceedings; and, apparently, it is for the purpose of ascertaining the owners that the evidence of title is required by the Navy Department. Accordingly, with the understanding that the evidence of title which the Attorney General states is required in connection with the condemnation proceedings is evidence which is necessary or will be utilized primarily or in the first instance by the Navy Department in attempting to effect settlement by negotiation, this office will not be required to object to the use of the appropriations of the Navy Department available for the acquisition of the land to pay the cost of obtaining such evidence of title; and, of course, such evidence when so obtained may be made available to the Departinent of Justice, also, for its use in connection with the condemnation proceedings involving such land. (B-24097) TRANSPORTATION-HOUSEHOLD EFFECTS-MOTOR VAN SHIPMENTS— EXCESS OF CONTRACT RATES OVER PUBLISHED RATES While under the provisions of Executive Order No. 9122, issued pursuant to the uniform household effects transportation statute of October 10, 1940, that in determining the most economical mode of transportation, the lowest available motor van charges may be determined from published tariffs or by advertising, an employee whose household effects are shipped under an otherwise proper contract awarded a motor van carrier on the basis of its low bid at rates in excess of published motor van tariff rates in effect for the general public is not chargeable with the excess, the carrier should be required to refund any amount paid in excess of such published rates. Where contracts for transportation of household effects of transferred employees pursuant to the uniform household effects transportation statute of October 10, 1940, and Executive regulations thereunder, are let to motor van carriers without first ascertaining the published motor van carrier rates, there should be inserted in such contracts a proviso to the effect that payments made thereunder will be subject to audit and check against the published rates, and that any excess payments for services available at lower published rates must be refunded. Comptroller General Warren to the Secretary of Agriculture, July 11, 1942: Consideration has been given to the matters presented in your letter of February 23, 1942, as follows: Review is requested of audit action taken by the General Accounting Office on D. O. Voucher No. 173170, accounts of G. F. Allen, August 1939, covering payment to Lightning Moving and Warehouse Company, Phoenix, Arizona, for transportation by motor van of the household goods belonging to Mr. R. E. Beckett, from Sacaton, Arizona, to Bard, California. The notice of exception reads in pertinent part as follows: "Charge for packing and hauling household goods of R. E. Beckett by motor van from Sacaton, Arizona, to Bard, California, during June 1939. "A showing of the actual weight of the shipment together with an itemization of the incidental expenses of packing and a list of the materials used, has not been furnished. Allowance is based on the estimated weight and value. 5,200 pounds at $1.55 cwt. for distance of 203 miles---Packing and materials furnished---. "Reply dated September 19, 1940, noted. $80.60 19.00 99.60 "It appears that the contractor, Lightning Moving and Warehouse Company, of Phoenix, Arizona, was not a party to any tariff applicable on interstate traffic, and the bid was accepted under the provisions of section 3709, Revised Statutes (41 U. S. C. 5), for the transportation of household effects for which, under the provisions of section 217B, Motor Carrier Act (49 Stat. 543), the rates quoted were not required to be published. However, there was available under authority of Intermountain Motor Freight Tariff No. 2, M. F. I. C. C. No. 2, equal service via various other carriers. "Inasmuch as the rates charged are in excess of otherwise published rates for shipment of household effects by motor van service from Sacaton, Arizona, to Bard, California, payment of an amount in excess of such published rates is unauthorized. See 19 Comp. Gen. 641. "Reply dated March 24, 1941, noted. "18 Comp. Gen. 641-requiring the solicitation of bids because the motor carriers in many instances will give lower rates to the United States for transportation services than to the public generally-affords no basis for payment of an amount in excess of the applicable C. C. C. (sic) Motor carrier rates. "In the absence of an itemization showing the cost of the materials used in the packing, credit in excess of the Interstate Commerce Commission motor van rates and the estimated cost of packing may not be allowed." As evidenced by the Department's regulations, it has for the long past required that the movement of household goods upon permanent change of station be made by the least expensive form of transportation. To determine the least expensive method, in the instant case, competitive bids were solicited on the two modes of transportation available, i. e., packing, crating, and otherwise preparing the goods for rail shipment (water transportation not being available), and for transportation by motor van. The following comparative statement of the costs involved by the two modes of transportation indicated that movement by van at a cost of $180.00 was the lowest price, and it was so accepted: Lightning Moving & Warehouse Co. (U. S. D. A. 5028 Estimated weight 5,200 pounds freight. Uncrating at destination.... Total.. $157.50 $180.00 235. 22 |