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B-195351.2 1 (1980-04-30)

handle is hein.gao/gaobabjtg0001 and id is 1 raw text is: 


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0                  COMPTROLLER GENERAL OF THE UNITED STATES
                            WASHINGTON, D.C. 20548




         B-195351.2                  April 30, 19b0




       VThe Honorable A. Vernon Weaver
         Administrator, Small Business
           Administration

         Dear Mr. Weaver:

              This is our response to your General Counsel's
         request for reconsideration of our decision, B-195351,
         dated January 21, 1980, on the claim of the Security i26o-6 77
         Bank & Trust Company, Lawton, Oklahoma (Bank), against
         the Small Business Administration (SBA) arising from
         an 8(a) contract arrangement involving Bluford Ser- PL7
         vice Company (Bluford) for food services-ot--ES--,
         trl lma. Th 7factual basis for that decision was
         provided by documented reports from the SBA and the
         Department of the Army, and there we considered the
         positions of all parties. After considering the
         additional points presented by the SBA and the Bank,
         we affirm our earlier conclusion that the Government
         is not liable to the Bank.

              The facts are undisputed. Under the provisions      #Pd
         of section 8(a) of the Small Business Act, the SBA        '7yD-o
         entered into a prime contract with the Army and the
         SBA entered into a subcontract with Bluford. Bluford
         was to provide services at Fort Sill. Based upon a
         valid assignment of contract proceeds, the Bank
         granted a line of credit to Bluford in the amount of
         $80,000 to be repaid from the semimonthly contract
         payments each of which exceeded $80,000. The assign-
         ment authorized and directed that contract payments
         be made directly to the Bank. Originally, the prime
         contract covered the period from October 1, 1976,
         through September 30, 1977, but the contract period
         was extended by contract modifications through
         September 30, 1978. A February 25, 1978, modifica-
         tion provided that the contract could be terminated
         for the convenience of the Government in the event
         that a contract was awarded under a then pending
         solicitation at any time prior to September 30, 1978.

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