BNUMBER:  B-259208
DATE:  March 6, 1996
TITLE:  Government Printing Office--Environmental Protection
Agency--Interagency Orders--Appropriations

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Matter of:Government Printing Office--Environmental Protection 
          Agency--Interagency Orders--Appropriations

File:     B-259208

Date:     March 6, 1996

DIGEST

The Environmental Protection Agency (EPA) is only liable for the 
publication services that authorized personnel requisitioned from the 
Government Printing Office (GPO).  After having enlarged the 
publication project without first receiving the approval of authorized 
EPA officials, GPO cannot charge the requesting agency for the costs 
of the expanded project.

DECISION

This responds to the request from the General Counsel of the 
Government Printing Office (GPO) asking for an opinion concerning a 
$304,334 bill that his agency submitted to the Environmental 
Protection Agency (EPA) for publication services.  For the following 
reasons, we conclude that EPA's liability for the publication services 
is limited to the $14,000 that it obligated through requisitions, and 
that GPO must cover the additional costs incurred.

Background

In June 1992, EPA submitted a requisition to GPO ordering an 
electronic publication at a total cost, as estimated by GPO, not to 
exceed $9,000.  According to the EPA technical representative for the 
project, GPO was to convert the sixteen volumes of title 40 of the 
Code of Federal Regulations (CFR) from its paper format to an 
electronic format at a GPO-estimated cost of approximately $600 per 
volume.  The EPA volumes of the CFR were the first of the 200 CFR 
volumes that GPO planned to convert.  In April 1993, EPA submitted 
another requisition, at GPO's request, for an additional $5000 to add 
graphics to the publication, committing EPA to a total of $14,000.  
The GPO General Counsel states that as work under these two 
requisitions progressed, verbal instructions from the EPA technical 
representative for the project, John Richards, caused GPO to enlarge 
the scope of its work beyond the $14,000 already committed.  The 
General Counsel asserts that GPO incurred over $300,000 in project 
costs because Richards "provided the impression to GPO representatives 
that funding for the enlarged and evolving experimental project would 
be available."

Prior to the April 1993 requisition where authorized EPA officials 
fixed EPA's total commitment at $14,000, the EPA Chief, Printing 
Management Section, in a memorandum to GPO dated November 17, 1992, 
identified the EPA employees who were authorized to commit the agency 
to printing services.  The memorandum does not identify Richards as an 
official authorized to order printing services nor does GPO argue that 
Richards was given such a designation at one of the several meetings 
between the two agencies.  According to EPA, Richards' sole function 
on the project was to act as a technical advisor, available to assist 
GPO in the use of microcomp, an electronic document format adopted by 
several federal agencies, to produce the electronic publication. 

The EPA Associate General Counsel, Contracts, Claims and Property 
Division, states that EPA never had any anticipation of funding the 
project at a level greater than the $14,000 that it obligated.  He 
further asserts that even if Richards gave GPO the "impression" that 
additional funding would be available, the technical advisor had no 
authority to commit EPA appropriations to expenses exceeding the 
amounts in the requisitions.  Richards, himself, denies that he asked 
GPO to enlarge the project, and states that the bill from GPO for 
additional work came as a "total surprise" to him.

Analysis

The agreement between EPA and GPO for the electronic publication was 
governed by the two GPO Standard Form 1 Printing and Binding 
Requisitions that EPA used to order the work.  After an ordering 
agency certifies that it requires the services of GPO, the Public 
Printer is required to furnish an estimate of the cost of the services 
pursuant to which the ordering agency may make a requisition for 
performance from GPO.  44 U.S.C.  sec.  1103.  GPO must then adhere to the 
terms of the requisition since, as a legal matter, "[p]rinting may not 
be done without a special requisition     . . . filed with the Public 
Printer."  44 U.S.C.  sec.  1102(c).

Agencies are responsible for establishing procedures to safeguard 
against overexpenditures when placing or filling interagency orders 
for goods or services.  GAO's Policy and Procedures Manual for 
Guidance of Federal Agencies states that "[w]hen the total cost of 
performance is not known in advance, costs should be estimated, and 
this estimated amount should constitute a ceiling on the costs that 
may be incurred by the performing agency without notifying, and 
receiving approval from, an authorized official of the requesting 
agency."  GAO, Policy and Procedures Manual for Guidance of Federal 
Agencies, tit. 7, Sec. 2.4(C)(2)(b) (TS No. 7-43,    May 18, 1993).  
In this case, EPA officials, using the GPO requisition forms, 
established a $14,000 ceiling for the project.  See 59 Comp. Gen. 386, 
388 (1980).  Before incurring expenses exceeding the ceiling, GPO 
should have given EPA new cost estimates and obtained requisitions 
from EPA, in accordance with GPO statutes.

GPO apparently based its decision to exceed the ceiling and expand the 
project on comments from the project's technical advisor.  The record 
does not establish that the technical advisor requested the additional 
work.  Richards denies that he asked GPO to exceed the scope of the 
work contracted for in the EPA requisitions, and GPO has no 
documentation that he ordered the additional work.  Even if we assume 
that Richards requested the additional work, EPA points out that he 
lacked the authority to bind the agency.  In this regard, EPA is not 
bound by unauthorized or misleading representations of its employees, 
because when a government employee acts outside the scope of the 
authority actually held by him, those who deal with him are deemed to 
have notice of the limitations on his authority.  56 Comp. Gen. 131, 
136 (1976).  See, e.g., B-182081, Jan. 26, 1977 (GPO invoice could not 
be paid since the authority of the government employee to place the 
order had expired).  Thus, although GPO presented no evidence to 
substantiate its assertion that Richards approved the additional work, 
even if we were to accept GPO's assertion, we must conclude that since 
Richards was not authorized to contract for printing services, he 
lacked the authority to commit EPA to expenditures beyond those in the 
requisitions.

Accordingly, since authorized EPA officials obligated a total of only 
$14,000 in their requisitions for the electronic publication, the 
agency is not liable for the $304,334 in additional expenses that GPO 
incurred.  GPO should use its own appropriations to cover all costs 
above the amounts authorized in the EPA requisitions.

/s/ Robert P. Murphy
for Comptroller General
of the United States