b. Cash bids need not be solicited when the items sought to be sold or exchanged may be disposed of without solicitation of bids under applicable laws and regulations.

c. Only one type of bid (cash or trade-in) need be solicited when recent solicitation for identical items has produced only that type of offer under circumstances indicating the futility of further advertising for any other type of offer.

d. Only one type of bid (cash or trade-in) need be solicited when solicitation for other types of bids has proven clearly ineffective in reducing the cost of acquisition; e.g., by reason of the commercial practice with respect to exchange or sale of such items. Agencies should make tests at reasonable intervals to determine whether this subsection may be properly invoked.

13. Dangerous materials. There are two other restrictions on the use of the authority contained in the regulation,75 i.e., dangerous material shall not be exchanged or sold without first rendering such property innocuous or providing adequate safeguard therefor, and no combat material shall be exchanged or sold without first demilitarizing such property if demilitarization is found to be in the best interest of public health, safety, and security. Demilitarization may include rendering such property innocuous, stripping from it any confidential or secret characteristics, or otherwise making it unfit for military use. Demilitarization of property to be exchanged or sold shall be accomplished in such a manner as to preserve so far as possible any civilian utility or commercial value of the property." 14. Sale procedure. Section 1-II-213.09 (16 Sept. 1960), of General Services Administration Regulations provides that the Standard Forms 114, 114A, 114B and 114C will be used in making sealed bid sales of property pursuant to that section in the same manner as is required in sales of surplus personal property. If the sale is by auction, spot bid, or negotiated sale, executive agencies shall, except as may be otherwise authorized by the Administrator, use the General Sales Terms and Conditions of Standard Form 114C and may use Standard Forms 114, 114A and 114B as deemed appropriate. Additional special terms and conditions may be used if not inconsistent with the provisions contained in Standard Forms 114A and 114C. The Regulation also provides:""

a. All invitations for bids for property being offered in accordance with Section 213 will include the following notation: "This property

75 GSA Reg. 1-II-213.08 (5 April 1955).

76 The exchange authority was delegated by the Secretary of Defense to the Secretary of Army on 29 Jan. 1951; from the Secretary of Army to Under Secretary of the Army on 23 May 1951; from Under Secretary of Army to ACofS, G-4, by "General Delegation of Authority and Revocation of Authority," dated 9 April 1954; and from ACofS, G-4, to the Chiefs of Technical Services by "General Delegation of Authority and Revocation of Authority" of the same date. TGSA Reg. 1-II-213.10 (16 Sept. 1960).

is being offered in accordance with the exchange/sale provisions of the Federal Property and Administrative Services Act of 1949, as amended."

b. Each transaction carried out under the authority of this section shall be evidenced in writing, which shall indicate the amount of trade-in allowance or proceeds of sale, if any, involved in such transaction.

c. Executive agencies shall prepare and maintain such records as will show full compliance with the provisions of this section and with the applicable provisions of the Federal Property and Administrative Services Act of 1949, as amended."

III. Donations

78

15. Donations. Because a donation is an "alienation" and an "effectual transfer," donations of Government property must, like other forms of disposal, depend on authorizations by Congress."9 Congress has authorized donation of public property in two provisions of the Federal Property and Administrative Services Act. The first of these provisions relates to donations to public bodies:80

The Administrator [of General Services] may authorize the abandonment, destruction, or donation to public bodies of property which has no commercial value or of which the estimated cost of continued care and handling would exceed the estimated proceeds from its sale. Permissible donees of surplus and excess property under this provision include:81 "Any State, Territory, or possession of the United States; any political subdivision thereof; the District of Columbia; any agency or instrumentality of any of the foregoing, or any agency of the Federal Government." Public Bodies receiving donations pursuant to the authority quoted above are required to pay the costs incident to the donation, such as packing, preparation for shipment, demilitarization, loading and transportation to the donee, etc.82

"Certain other exchanges are specifically authorized by statute: Exchange of deteriorated and unserviceable ammunition and components thereof for ammunition or components thereof in condition for immediate use, subject to regulations under the Federal Property and Administrative Services Act of 1949, 10 U.S.C. § 4538 (1958); exchange of foreign excess property upon such terms and conditions as the head of the executive agency concerned deems proper, sec. 401 of the Federal Property and Administrative Services Act of 1949, 63 Stat. 397, as amended, 40 U.S.C. § 512 (1958); exchange of property which is surplus upon such terms and conditions as the Administrator of General Services Administration deems proper, sec. 202 of the Federal Property and Administrative Services Act of 1949, 63 Stat. 385, as amended, 40 U.S.C. § 484 (c) (1958).

Donation in its ordinary denotation means a gift which undoubtedly constitutes an effective abnegation. For this reason, donations are within Art. IV, sec. 3, cl. 2 of the Constitution. See further, 34 Ops. Att'y Gen. 320, 322.

60 Sec. 202 (h); 63 Stat. 384, as amended, 40 U.S.C. § 483 (h) (1958).

81 "Public body" is defined in GSA Reg. 1-I-102.01(23) (7 April 1955).

83 Par. 18b, AR 755–7, 9 Nov. 1954; GSA Reg. 1-IV-403.02 (1 March 1955). In addition to demilitarization (par. 18k, AR 755-7, C 1, 20 June 1955), regulations require that, prior to donation, property which is dangerous to public health or safety shall be rendered innocuous or adequate safeguards provided therefore (par. 181, AR 755-7, 9 Nov. 1954).

The second of the "donation" provisions of the Federal Property and Administrative Services Act relates to donations for educational or public health purposes including research :83

Under such regulations as he may prescribe, the Administrator is authorized in his discretion to donate without cost (except for costs of care and handling) for use in any State for purposes of education, public health, or civil defense, or for research or for any such purpose any equipment, materials, books, or other supplies (including those capitalized in a working capital or similar fund) under the control of any executive agency which shall have been determined to be surplus property and which shall have been determined under paragraph (2), (3), or (4) of this subsection to be usable and necessary for any such purpose.

Only surplus property may be donated under this provision. For nurposes of administering surplus property under control of the Department of Defense and the military departments, the Secretary of Defense is designated by the act (40 U.S.C. § 484 (j) (2) referred to in the quotation, supra) as the officer who shall determine whether such surplus property is usable and necessary for educational activities that are of special interest to the armed services. If the Secretary determines that such property is not so usable and necessary, then the property may be disposed of under the provisions of 40 U.S.C. $ 484 (j) (3). This section permits the Secretary of Health, Education, and Welfare to determine whether surplus property (other than property as to which the Secretary of Defense has the power of determination) is usable and necessary for educational and public health purposes, including research.85 If the Secretary determines that such property is not so usable and necessary, then the property may be disposed of under 40 U.S.C. § 484 (j) (4) upon determination by the Federal Civil Defense Administrator that such property is usual and necessary for civil defense purposes.

63 Sec. 203 (1); 63 Stat. 385, as amended, 40 U.S.C. § 484 (j) (1958).

Prop

84 Service education activities do not apparently include service schools such as The Infantry School and The Judge Advocate General's School. Such institutions will be able to acquire "excess" property in the same fashion as other Government activities, .e., by transfer, to fulfill the provisions of § 201(a) of the Federal Property and Administrative Services Act (40 U.S.C. § 483 (a) (1958)), which call for transfer of excess among Federal agencies. Educational activities who receive donations under § 203 (j) (3) are activities of "special interest" to the armed services such as privately operated military schools, preparatory schools for service academies (United States Military and Naval Academies, etc.). A list of educational activities designated by the Secretary of Defense may be found in Appendix I, AR 755-5, C 8, 16 April 1959.

85 Sc. 203 (j) (2), as amended, 40 U.S.C. § 484 (j) (3) (1958), permits the Secretary of Health, Education, and Welfare to allocate surplus property to the State agency designated under State law with the responsibility of distributing same to the following types of donees: "tax-supported medical institutions, hospitals, clinics, health centers, school systems, schools, colleges, and universities; other non-profit medical institutions, hospitals, clinics, health centers, schools, colleges, and universities which have been held exempt from taxation under section 101 (6) of the Internal Revenue Code [§ 501 of the Internal Revenue Code of 1954]."

The property is then transferred by the General Services Administrator to a State agency for distribution to civil defense organizations of such State or sub-division thereof.

erty determined to be usable and necessary for donation pursuant to section 203 (j) (2) or (3) is handed over to the Administrator of General Services for transfer to the designated donee. Another statutory provision permits the Secretary of the Army, subject to applicable regulations under the Federal Property and Administrative Services Act, to loan or give to municipal corporations, soldiers' monument associations, recognized war veteran associations, and non-profit museums condemned or obsolete combat material, books, manuscripts, works of art, drawings, plans or models which are not needed by the Army.87 The statute provides that the Government shall incur no expense in connection with any loan or gift.

IV. Abandonment or Destruction

16. Abandonment or destruction. Abandonment or destruction of Government property is authorized by the provisions of section 202 (h) of the Federal Property and Administrative Services Act (quoted in par. 15, above, in connection with donations). Surplus and excess property may be abandoned under this provision where it has been determined in writing (by an authorized official other than the officer accountable for the property) either that the property has no commercial value or that the estimated cost of its continued care and handling would exceed estimated proceeds from sale.88 It must also be determined that donation of the property to a public body is not feasible.89 In addition, the agency involved must give public notice of its intent to abandon or destroy.90

V. Loans of Government Property

17. Loans of Government property. As a general rule, loans of Government property to individuals and organizations outside of the Government are unauthorized without statutory authority therefor.91 (Some aspects of a problem cognate to loans, i.e., furnishing property to Government contractors is treated in chapter 12, infra.) There

710 U.S.C. § 2572 (1958). This statute also applies to the Navy, Air Force and Treasury (Coast Guard). Army implementation is contained in par. 32, AR 755-5, 14 July 1953.

88 63 Stat. 384, as amended, 40 U.S.C. § 483h (1958). Regulations pertaining to the required determination and finding are contained in par. 18c, AR 755-7, 9 Nov. 1954, and in GSA Reg. 1-IV-402 (10 Oct. 1956) and 1-IV-404.01 (6 Feb. 1956).

Par. 186, AR 755-7, 9 Nov. 1954; GSA Reg. 1-IV-404.01a2 (6 Feb. 1956).

DO Public notice need not be given when it has been found (in writing) that immediate destruction or abandonment is necessary or desirable in the best public interest because of its nature or because of the expense or difficulty of its care or handling. If all the property proposed to be abandoned or destroyed at any one location at any one time had an original cost (estimated, if not known) of less than $100, it should be presumed that its immediate abandonment or destruction without notice is : ed by reason of the expense of difficulty of its care or handling. Par. 18g, AR 755–7, C 1, 20 June 1955; GSA Reg. 1-IV-404.03 (6 Feb. 1956).

91 This is based on the Constitution (Art. IV, sec. 3, cl. 2), JAG 400.339, 21 Dec. 1928 (Dig. Op. JAG 1912-40, p. 21). See also JAG 80-140, 1 Oct. 1913 (Dig. Op. JAG 1912-40, p. 21).

are a number of statutes specifically authorizing the loan of Army property to veterans' organizations and to educational institutions.92 VI. Miscellaneous Statutes Relating to Disposal

93

18. General. In section 4 of the act of 16 July 1952, Congress authorized the military departments to furnish contractors such research, developmental or test facilities as may be determined by the respective Secretaries to be necessary. Such facilities may be acquired or constructed at Government expense and furnished to contractors by lease, loan, or sale at fair value. The contractor need not be required to reimburse the Government for the use of such facilities. However, if the facilities are to be installed or constructed on property not owned by the Government and the facilities are of a type which is not readily removable or separable without unreasonable expense or unreasonable loss of value, then the contract under which they are furnished must provide for reimbursement to the Government of the fair value of the facilities upon the completion or termination of the contract, or within a reasonable time thereafter, or an option in the Government to acquire the underlying land, or such other provisions as in the opinion of the Secretary concerned will adequately protect the Government's interest in the facilities. (See chapter 12, infra).

19. Title II, First War Powers Act. Another statute of considerable importance in connection with disposals with Title II, the First War Powers Act. The extremely broad provisions of this statute permitted defense agencies when authorized by the President 95 to enter into contracts and into amendments or modifications of contracts without regard to the provisions of law relating to the making, performance, amendment, or modification of contracts whenever such action would facilitate the national defense. The Judge Advocate General held that the act afforded not only authority to procure, but also the authority to dispose of Government property when the disposal was incidental to procurement and met the test of being in the interest of the national defense.96 Title II was re

92 Veterans' organizations: 10 U.S.C. § 4683 (1958) (obsolete or condemned rifles), 10 U.S.C. § 4686 (1958) (condemned ordnance), 10 U.S.C. § 2572 (1958) (condemned or obsolete items); educational institutions: 10 U.S.C. § 4685 (1958) (obsolete ordnance), 10 U.S.C. § 4651 (1958) (arms, tentage and equipment), 10 U.S.C. § 4654 (1958) (quartermaster supplies and stores), 10 U.S.C. § 4653 (loan of ordnance and ordnance stores to District of Columbia High School), 10 U.S.C. § 2542 (1958) (loan of medical and similar equipment for training purposes to organizations found by American National Red Cross for the purpose of aiding the Army and Navy in war). 93 10 ~~. § 2353 (1958).

4 Act of 12 January 1951, 64 Stat. 1257, as amended, 50 U.S.C. § 611.

25 Executive Order No. 9001, 27 Dec. 1941, 6 Fed. Reg. 6787, and Executive Order No. 10210, 2 Feb. 1951, 16 Fed. Reg. 1049 authorized the armed services to take actions pursuant to this Act.

90 SPJGA 160, 17 April 1942.