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B-278215 1 (1998-01-07)

handle is hein.gao/gaocrptahnl0001 and id is 1 raw text is: oComptroller General of the United States Washington, D.C. 20548 Decision Matter of: Alamo Aircraft Supply, Inc.; Merchants World Surplus Enterprises, Inc. File: B-278215; B-278215.2 Date: January 7, 1998 John J. Fausti, Esq., and Stephanie L. Buser, Esq., for the protester. Robin Walters, Esq., and Michael Malone, Esq., Defense Reutilization and Marketing Service, Defense Logistics Agency, for the agency. John L. Formica, Esq., and James A. Spangenberg, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1. Solicitation for the sale of surplus property under a term contract is not transformed into something other than a sale because of the inclusion of a provision requiring that the successful contractor pay the government 80 percent of the net proceeds, if any, it obtains from the property in addition to its bid price. 2. Sale of surplus property is not an unauthorized sale on credit where at the time of the sale there is no credit extended or debt incurred; a provision which requires that the contractor pay the government 80 percent of the net proceeds, if any, the contractor obtains from the property does not render the transaction a credit sale. 3. A solicitation for the sale of surplus property will not result in an illusory contract because of a termination clause, where the clause does not allow the parties to terminate at will, but rather allows the parties to terminate only if certain specified contract performance thresholds are not attained. 4. Neither the financial requirements imposed by a solicitation which provides for the award of a term sale contract, nor the size, scope, or length of the contract contemplated by the solicitation, violates the requirement set forth in the Federal Property and Administrative Services Act of 1949 that solicitations for the disposal of property be on such terms and conditions as shall permit that full and free competition which is consistent with the value and nature of the property involved, given the apparent reasonableness of the agency's explanation for the challenged provisions and the protesters' failure to substantively respond to the agency's position.

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