claimed therefor, which work is of an intangible nature, i.e., scientific research, was actually rendered or the materials furnished.

Section 11 of the National Science Foundation Act of 1950, 42 U.S.C. 1870, sets forth the general authority of the Foundation, within the limits of available appropriations, to do all things necessary to carry out the provisions of the act. Subsection (i) thereof authorizes the Foundation "to prescribe, with the approval of the Comptroller General of the United States, the extent to which vouchers for funds expended under contracts for scientific research shall be subject to itemization of substantiation prior to payment, without regard to the limitations of other laws relating to the expenditure of public funds and accounting therefor." To our knowledge the Foundation has submitted no procedures for vouchering and documenting expenditures for scientific research to the General Accounting Office for approval.

As stated in your letter, 7 GAO 4070 concerning reimbursements between Government agencies provides under subsection 4070.20a that a sound receiving system to verify the receipt of supplies, materials, and services should be established even if such items are furnished by a Government agency. And 7 GAO 4040.20 requires, as a prerequisite to payment of Standard Form No. 1080-Revised, "Voucher for Transfers between Appropriations and/or Funds," certification of the voucher by an authorized administrative or certifying officer in the office billed of the receipt and acceptance of the articles furnished or services rendered by the billing agency.

Section 2 of the act of December 29, 1941, 55 Stat. 875, 31 U.S.C. 82c, makes it the responsibility of the officer or employee certifying a voucher to ensure that the facts stated or certified are correct and that the proposed payment is lawful under the appropriation or fund chargeable therewith. See 22 Comp. Gen. 48; 23 id. 181, 953; 33 id. 650. It is clear under the circumstances that certification of the voucher in question for payment, unsupported by evidence that the services and materials ordered were furnished and accepted, is not contemplated by the statute, would merely be a matter of form and meaningless and, therefore, such certification is not authorized. See 23 Comp. Gen. 181.

It may be stated generally that it is the duty of the administrative officers of the department involved having authority to incur obligations against the department's funds to determine in the first instance whether the services and materials ordered were necessary in connection with the performance of the work involved, and whether the amount for which reimbursement is claimed is that agreed upon. And it has been held that charges for interagency reimbursable services-based upon the cost of rendition-need not be audited by the

requisitioning agency in order to determine the correctness thereof. See 32 Comp. Gen. 479.

The referred-to letter of February 26, 1959, a copy of which accompanied your letter, contains a request that the National Science Foundation "be kept informed of the progress made by the Department of the Army in connection with this project." If the request "If were complied with, someone in the Foundation should be in a position to certify therefrom that the services and materials ordered were furnished and accepted, and that payment therefor is proper. On the other hand, if the request were not complied with an effort should be made to obtain the progress reports from the Department of the Army with the view of making the necessary determination.

Accordingly, you are advised that, on the present record, certification of the voucher for payment is not authorized. The voucher is returned herewith.

[B-141648]

Civilian Personnel-Compensation-Rates-Highest Previous Salary Rate-Computation

The establishment of the salary of a former Foreign Service officer who is appointed to a position under the Classification Act of 1949, at the minimum of the grade rather than at the highest rate previously earned, may be retroactively corrected to conform to administrative policy which provides for establishment of salary rates at the maximum permissible rate.

A regulation which would permit the establishment of entrance salary rates of positions under the Classification Act of 1949, on the basis of the highest previous rate received in positions under other pay systems, by increasing such highest previous rates by statutory increases in such other systems prior to conversion to Classification Act rates was within the authority vested in the Civil Service Commission, under section 802 (a) of the act, to prescribe rates of compensation of employees upon reinstatement, reappointment and reemployment; therefore, the highest previous salary rate of a Foreign Service officer appointed to a classified position may, within administrative discretion, be computed at the rate at time of resignation, plus statutory increases in the Foreign Service rates, and then converting such rate to the classified rate at time of appointment. To Muriel B. Scott, Department of Commerce, January 29, 1960:

Your letter of January 6, 1960, with enclosures, requests our decision whether you may certify for payment the voucher therewith submitted for $1,918.76 in favor of H. Herbert Hughes, Deputy Administrator of Business and Defense Services Administration, Department of Commerce, covering a retroactive adjustment of compensation.

The record shows that Mr. Hughes entered on duty in BDSA on January 2, 1958, under a schedule C appointment as Deputy Administrator grade GS-17. His entrance rate of compensation was fixed at the lowest level of the grade, $13,975 per annum. At that time it was the policy of the BDSA to fix an employee's entrance rate of compensation at the maximum permissible rate. Prior to Mr. Hughes'

employment with BDSA he had served in the Foreign Service at an entrance rate of FSR-1, $12,000 per annum. On July 1, 1950, he received a periodic in-class promotion (step 2) to $12,400 per annum and resigned May 21, 1951. There is nothing in the file to show whether Mr. Hughes was employed by the Federal Government from May 22, 1951, through January 1, 1958.

You express the view that in computing the entrance rate the Foreign Service rate should be converted to the classification act pay schedule as of May 21, 1951, the date Mr. Hughes resigned from the Foreign Service and then increased by statutory increases in classification act rates. The propriety of increasing the highest previous rate by statutory increases in the Foreign Service rates and converting such rate to a classification act rate as of January 2, 1958, the date he entered on duty with the BDSA is questioned. Should your view be correct, you say that the $12,400 per annum rate for FSR-1, step 2, on May 21, 1951, was equivalent to the second step of grade GS-17, $12,400 per annum, subsequently increased as follows: $13,200 by Public Law 201, 82d Congress, approved October 24, 1951, 5 U.S.C. 1113, effective July 8, 1951; $14,190 by Public Law 94, 84th Congress, approved June 28, 1955, 5 U.S.C. 1113(b), effective March 13, 1955; and $15,615 by Public Law 85-462, approved June 20, 1958, 5 U.S.C. 1113, effective January 12, 1958. Under that method Mr. Hughes could have been appointed at the rate of $14,190 per annum. That rate would have been increased to $15,615 per annum on January 12, 1958, under Public Law 85-462, and further increased by a periodic step-increase effective July 12, 1959, to the third step of grade GS-17, $15,855 per annum.

By the alternative method used in computing the vouchered amount, the FSR-1 rate of $12,400, effective in May 1951, had been increased to $15,000 by January 2, 1958. Therefore, in the voucher transmitted with your letter Mr. Hughes' entrance rate is fixed at $14,835, the maximum scheduled rate of grade GS-17. That rate was increased by the 1958 salary increase act to $16,335.

Because of your doubt concerning the method used you request a decision upon the following questions:

1. Is Mr. Hughes entitled to retroactive adjustment in compensation due to an administrative error in fixing his rate of salary at time of appointment? 2. If your answer to Question 1 is in the affirmative, based on his “highest previous rate" of $12,400 in Foreign Service, has the proper method been followed in establishing the maximum step of GS-17, $14,835, as the correct rate effective January 2, 1958; and may the attached voucher be certified for payment?

3. If your answer to Question 2 is in the negative, should the Excepted Appointment (Correction) effective January 2, 1958, be shown as $14,190 per annum, the second step of GS-17; the Periodic Step-Increase effective July 12, 1959, be corrected to read from $15,615 to $15,855, and the voucher prepared accordingly?

We held in 34 Comp. Gen. 380, that retroactive salary adjustment may be made when, incident to the appointment of a former Foreign Service officer to a position in the Department of Agriculture under the Classification Act of 1949, an administrative error is made in fixing the employee's initial salary at the minimum instead of at the highest rate he had previously earned, contrary to the policy of the Department of Agriculture. Therefore, your first question is answered in the affirmative.

Section 25.102(j) in effect at the time Mr. Hughes was reemployed in a classification act position on January 2, 1958, provided in part as follows:

*** If such highest previous rate was earned in a position not subject to the Classification Act, it shall be increased only by those amendments to the Classification Act or other applicable statutory amendments which were enacted during a period when the employee was not in civilian service as described above. [Italics supplied.]

We have not heretofore had occasion to construe the above-italicized language in any decision. However, under section 802 (a) of the Classification Act of 1949, 5 U.S.C. 1132 (a), the Civil Service Commission has authority to fix the basic rate of compensation of any officer or employee when he is reinstated, reappointed, or reemployed. The language referred to first was used in section 25.102 (j) of the Federal Employees Pay Regulations, effective October 2, 1956 (21 FR 7507). It was deleted by amendment of section 25.102 (j), tive July 26, 1959, and is not in the current regulations.

effec

We understand that the purpose of the language was to authorize construction of entrance salary rates of positions under the classification act from highest previous rates attained under other pay systems by increasing such highest previous rates by statutory increases in such other systems, prior to conversion to classification act rates. In the exercise of administrative discretion the employee could be given the rate more beneficial to him.

In view of the statutory authority for the regulation, which regulation was in effect at the time of Mr. Hughes' reemployment, we find no objection to the method used in computing his revised entrance salary rate. Therefore, the voucher which is returned herewith properly may be certified for payment if correct in other respects.

In light of the affirmative answer to question two no answer is required to question three.

[B-141267]

Contracts—Awards-Equal or Tie Bids-Small Business

Set-Aside

Where two bidders who qualify as small business concerns submit equal low bids on the non-set-aside portion of a procurement and, pursuant to Armed Services Procurement Regulation 2-406.4, one has been chosen by lot for award of the non-set-aside portion, in the absence of similarly prescribed procedures for the award on the small business set-aside portion, both bidders-not just the one receiving the non-set-aside award-have the same right to be considered in negotiations for the set-aside, and the only way their rights can be fairly protected is through the use of the bidder lot method.

To the Secretary of the Air Force, February 2, 1960:

Reference is made to your letter of January 8, 1960, relative to a procurement under invitation No. IFB-40-604-60-298, Memphis Air Force Depot, Memphis, Tennessee.

The invitation, issued October 13, and amended October 27, 1959, divided a procurement of foam liquid into small business set-aside amounts of 150,000 gallons under item No. 1 (to be furnished in 5gallon containers) and 101,805 gallons under item No. 2 (to be furnished in 55-gallon drums) and non-set-aside amounts of 150,000 gallons under item No. 1 and 99,605 gallons under item No. 2. The Notice of Small Business Set-Aside attached to the invitation provided in part as follows:

150,000 additional gallons of Item 1 and 101,805 gallons of Item 2, as identifiled elsewhere in the schedule, has been set-aside for award to one or more Small Business Concerns. Negotiations for award of this set-aside portion will be conducted only with responsible Small Business Concerns who have submitted responsible bids on the non-set-aside portion of the unit price within 120% of the highest award made on the non-set-aside portion. Negotiations shall be conducted with such Small Business Concerns in the order of their bids on the non-set-aside portion beginning with the lowest responsive bid. The set-aside portion will be awarded at the highest unit price awarded for the non-set-aside portion. However, the Government reserves the right not to consider token bids or devices designed to secure an unfair advantage over other bidders eligible for the set-aside portion. The partial set-aside of this procurement for Small Business Concerns is based on a determination by the Contracting Officer, alone, or in conjunction with a representative of the Small Business Administration, that it is in the interest of maintaining or mobilizing the Nation's full productive capacity, in the interest of war or national defense programs, or in the interest of assuring that a fair proportion of Government procurement is placed with Small Business Concerns.

In response to the invitation, MacAndrews & Forbes Company submitted a bid of $1.22 per gallon on item No. 1 and $1.085 per gallon on item No. 2. Award was made on item No. 2 to a lower bidder. On item No. 1, award was made to National Foam Systems, Inc., which had submitted a bid equal to the bid of MacAndrews & Forbes Company on that item and which had been chosen by lot for the award in accordance with applicable regulations. It appears that both MacAndrews & Forbes Company and National Foam Systems, Inc., qualify as small business concerns. MacAndrews & Forbes Com