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B-183833 1 (1975-09-30)

handle is hein.gao/gaobadcmd0001 and id is 1 raw text is: DECISION FILE: B-183833 MATTER OF: STHE COMPTROLLER GEN4ERAL OF THE UNITED STATES WASHINGTON, 0. C. 20546 DATE: September 30, 1975 Capital Aero, Inc. q -739 K DIGEST: Where Government employee owns 39.95 percent of stock of corporation, it is concluded that he has substantial ownership in corporation. Conclusion is reached in view of significant history which has discouraged contracting between Government and its employees. Therefore, while agency restricted its view to employee's role in day-to- day management of corporation, since reasonable ground did exist, rejection of corporation low bid was not improper. Invitation March 21, 1975, Forest Service, Helena National The low bid was for bids (IFB) No. Rl-11-75-44 was issued on by the United States Department of Agriculture, seeking bids to provide aircraft services for the Forest. Bid opening was held on April 23, 1975. submitted by Capital Aero, Inc. However, subsequent to bid opening it was discovered that Mr. John F. Patten, who had signed Capital's bid as president of that corporation, was a full-time employee of the United States Government. Section 1-1.302-3 of the Federal Procurement Regulations (FPR) (1964 ed. amend. 95) states that: Contracts shall not knowingly be entered into between the Government and employees of the Government or business concerns or organizations which are substan- tially owned or controlled by Government employees, except for the most compelling reasons, such as cases where the needs of the Government cannot reasonably be otherwise supplied. The contracting officer relates that on several occasions, he telephoned Capital with regard to determining the bidder's respon- sibility. Each time he was informed by the answering party that pUBLISHED DECIOTN 5& Comp. Gen.........

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