Jump to content
The Wifcon Forums and Blogs
animalspirits

Gift of personal property vis-a-vis future related procurements

Recommended Posts

Fact Pattern: A company wants to gift/donate to an agency personal property (e.g., office furniture).  The personal property would be used for everyday use by agency personnel (e.g., desks, file cabinets) in the agency's offices.  In the past and future, the agency sometimes issues brand-neutral competitive solicitations for personal property of this general type, and the company may be a past contractor or a future potential offeror on such procurements.  The motivation for the gift and the timing of past and future solicitations are not known.

Question: Can the agency accept the gift?  And, if so, will the company submitting the gift be excluded from competition on future solicitations for this type of personal property?

From this post and GAO B-289903, I gather that without statutory authority, agencies may not accept gifts to supplement their appropriations.  I verified that the agency in question had such statutory authority to receive gifts of personal property.  The agency's Office of General Counsel (OGC) also had published written guidance on the topic of when the agency could receive gifted personal property from a non-governmental organization.  While the hypothetical company in question may be considered a "prohibited source" (because it is a potential contractor) in the context of this OGC guidance, the guidance states that a gift could be accepted from a prohibited source if a three-part test is met (e.g., percentage of contractor's business with the agency, timing of gift in relation to solicitations).

Assuming that OGC finds that the three part test is met and the gift may proceed, are there any other regulatory or legal issues that would prevent the contractor from competing in upcoming procurements?  I have concerns regarding the appearance of impropriety, but I need to base my analysis on cited sources.

Thank you!

Share this post


Link to post
Share on other sites
46 minutes ago, animalspirits said:

Assuming that OGC finds that the three part test is met and the gift may proceed, are there any other regulatory or legal issues that would prevent the contractor from competing in upcoming procurements?  I have concerns regarding the appearance of impropriety, but I need to base my analysis on cited sources.

 I'm having a hard time understanding why this "offer" would be entertained. The only thing I could come up with is that the agency feels that it has fallen short of its bid protest quota, and needs to create more reasons that disappointed bidders will file protests.

Share this post


Link to post
Share on other sites

You are correct that OGC may block this action in accordance with their three part test.  But I've been asked to research the "what if."  I see FAR 3.1 directing the avoidance of the appearance of impropriety.  And FAR 9.505 directs the CO to use common sense and good judgment when analyzing potential conflicts of interests.  Are these the only two standards that I should be considering?  Or is there something that I'm missing? Thanks!

Share this post


Link to post
Share on other sites

 Ha ha!  This reminds me of the time back in the early 1980s when our chief of quality assurance asked my resident engineer if it would be OK for one of the contractors to  install air conditioning in his government pick up truck. The contractor felt sorry for our chief of QA because he was putting more than 100,000 miles on his government pick up truck every year.   None of the Corps of Engineers staff vehicles had air-conditioning in those days, even though all of our projects were in Mississippi and Alabama .  George was always grumpy but was even more so during the summer months...

 I am sure that you can imagine what our resident engineer’s answer was. 😄😄😄

Your answer ought to be obvious. 

Share this post


Link to post
Share on other sites
1 hour ago, animalspirits said:

Assuming that OGC finds that the three part test is met and the gift may proceed, are there any other regulatory or legal issues that would prevent the contractor from competing in upcoming procurements?

Not that I know of. Have you thought of saying thanks, but no thanks?

Share this post


Link to post
Share on other sites

Are you the ethics official for your agency?  If not you may want to visit with them on the matter.  Why?  Well your reseach sounds complete but there is consideration beyond the FAR that the agency may want to evaluate before creating a perfect 60 minute cover story.

Share this post


Link to post
Share on other sites
1 minute ago, C Culham said:

Are you the ethics official for your agency?  If not you may want to visit with them on the matter.  Why?  Well your reseach sounds complete but there is consideration beyond the FAR that the agency may want to evaluate before creating a perfect 60 minute cover story.

No, I'm in the contracts office.  The three part test referred to above would be administered by the Ethics office in OGC, so Ethics would be integrally involved if this request is submitted.

Share this post


Link to post
Share on other sites
3 hours ago, animalspirits said:

The agency's Office of General Counsel (OGC) also had published written guidance on the topic of when the agency could receive gifted personal property from a non-governmental organization.  While the hypothetical company in question may be considered a "prohibited source" (because it is a potential contractor) in the context of this OGC guidance, the guidance states that a gift could be accepted from a prohibited source if a three-part test is met (e.g., percentage of contractor's business with the agency, timing of gift in relation to solicitations).

Assuming that OGC finds that the three part test is met and the gift may proceed, are there any other regulatory or legal issues that would prevent the contractor from competing in upcoming procurements?  I have concerns regarding the appearance of impropriety, but I need to base my analysis on cited sources.

The contractor's own written policies  that may include avoiding an appearance of conflict of interest should be reviewed to determine whether the "gift'" may be prohibited by its own policies. 

My view is that the OGC and Agency, even after acceptance of the gift, does not by itself insulate a contractor from corrupt intent focus in offering the gift. See for example, 18 USC 201 Bribery of Public Officials and Witnesses. Subparagraph (b)(1) is as follows: 

(b) Whoever (1) directly or indirectly, corruptly gives, offers or promises anything of value to any public official or person who has been selected to be a public official, or offers or
promises any public official or any person who has been selected to be a public official to give anything of value to any other person or entity, with intent...
You may wish to take a look at the U S Office of Government Ethics Compilation of Federal Ethics Laws https://www.oge.gov/web/OGE.nsf/All Documents/0BC1FF0EB760D84A85257E96006A9256/$FILE/Compilation of Federal Ethics Laws (2015).pdf?open.
I see the gift of (used?) furniture as providing an income tax deduction. Such a tax benefit could have been accomplished through a donation to charitable entities. Donating it instead to a government agency that a contractor wishes to do business with does not sound angelic to me or a sound business practice.

   

Edited by Neil Roberts
spelling error

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

×