IIB
109th CONGRESS
2d Session
H. R. 3961
IN THE SENATE OF THE UNITED STATES
September 26, 2006
Received
November 13, 2006
Read twice and referred to the Committee on Energy and Natural Resources
AN ACT
To authorize the National Park Service to pay for services rendered by subcontractors under a General Services Administration Indefinite Deliver/Indefinite Quantity Contract issued for work to be completed at the Grand Canyon National Park.
Definitions
As used in this Act, the following definitions apply:
IDIQ
The term IDIQ means an Indefinite Deliver/Indefinite Quantity contract.
Park
The term park means Grand Canyon National Park.
PGI
The term PGI means Pacific General, Inc.
Secretary
The term Secretary means the Secretary of the Interior, acting through the Director of the National Park Service.
Findings and purpose
Findings
Congress finds the following:
The park issued approximately 40 task orders to PGI under an IDIQ between fiscal years 2002 and 2003 for a variety of projects.
The value of these task orders was over $17,000,000 for various construction projects throughout the park.
According to invoices sent to the park, PGI certified that proceeds of payments were being sent to subcontractors and suppliers.
In January 2004, complaints were received by numerous subcontractors citing lack of payments by PGI.
The National Park Service has paid over $10,000,000 to PGI, of which an estimated $1,300,000 was owed, but not paid to subcontractors.
During an acquisition management review conducted by the Washington Contracting and Procurement Office of the National Park Service, it was found that the park had failed to ensure that PGI obtained the necessary payment and performance bonds required by the IDIQ and the Miller Act (40 U.S.C. 270a).
On February 6, 2004, the National Park Service suspended further payment to PGI and issued a suspension notice to cease activity by the contractor.
The National Park Service gave PGI every reasonable opportunity to resolve the situation, but PGI has effectively ceased doing business.
Recovery by the Government of that $1,300,000 is unlikely.
The National Park Service is prohibited from making payments to a contractor without obtaining payment and performance bonds.
Contract law generally prohibits payment directly to subcontractors because of the lack of a direct, contractual relationship between the parties.
The Federal Government has derived benefits from the work that has been completed.
Purpose
The purpose of this Act is to authorize the Secretary to pay for services rendered by subcontractors that should have been paid by PGI.
Authorization
The Secretary is authorized to use $1,300,000 from the park’s entrance fee revenues to pay subcontractors of PGI for work performed at the park under an IDIQ with PGI between fiscal years 2002 and 2003 provided that—
the primary contract between PGI and the National Park Service is terminated;
the amount owed to the subcontractors is verified;
all reasonable legal avenues or recourse have been exhausted by the subcontractors to recoup amounts owed directly from PGI; and
the subcontractors provide a written statement that payment of the amount verified in paragraph (2) represents payment in full by the United States for all work performed at the park under the IDIQ with PGI between fiscal years 2002 and 2003.
Passed the House of Representatives September 25, 2006.
Karen L. Haas,
Clerk.