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092466 1 (1971-08-18)

handle is hein.gao/gaobacwjv0001 and id is 1 raw text is: ZIVIL DIVISION~ UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 AUG i 8 1971 Dear Mr. Hargrove: In fiscal year 1971, the General Accounting Office initiated a survey of the policies, procedures, and practices for awarding )()(C 00 and administering contracts throughout the Post Office Department. A This survey was undertaken because of the significant dollar amounts of the Department's annual contractual obligations--more than $1.3 billion in fiscal year 1970--and because our prior reviews of various Department activities had identified questionable contracting prac- tices and the wide dispersal of authority and responsibility for awarding and administering contracts among a number of Department organizations. As examples of identified questionable contracting practices, in our review of air taxi mail service we found that the Department had (1) inappropriately used emergency contracts for such service, (2) awarded contracts without obtaining formal competitive bids and without adequate assurance that bidders were qualified, and (3) granted questionable contract rate increases. At the Postal Service Manage- ment Institute we found (1) extensive use of sole source procurement contracts without adequate justifications for such contracts and (2) the award of a large number of contracts and contract modifications before a determination was made that funds were available to pay for them. In reviewing the Postal Source Data System, we noted, among other things, that detailed system specifications had not been prepared and site surveys had not been made to determine equipment needs prior to awarding the multi-million dollar contract to acquire the system. The purpose of this letter is to notify you that we are suspending our survey because of recent actions taken in connection with the reorganization of the Post Office Department into the new United States Postal Service. These actions include the centralization, within one headquarters Department, of all procurement responsibility for the Postal Service, except for mail transportation contracts, and the preparation of a Postal Contracting Manual setting forth for the first time Service-wide contracting policies and procedures. On the basis of the information thus far made available to us regarding these actions, it appears that significant efforts are being made to establish an improved organizational structure and a uniform set of policies and procedures for the contractual activities to be under- taken by the new Postal Service and that, therefore, it would be inappropriate for us to continue our current survey. 50TH ANNIVERSARY 1921-1971

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