award, confirmation of the contractor's bid as to weights and prices, an error in the shipping weight alleged subsequent to award must be regarded as an unilateral-not mutual-mistake, due solely to the contractor's negligence or oversight and in nowise contributed to by the Government, and may not be regarded as affording any legal basis for modifying the bid which, having been accepted by the Government in good faith, consummated a valid and binding contract. Acting Comptroller General Yates to the Secretary of the Interior, July 16, 1947: I have your letter of July 3, 1947, with enclosures, relative to an error alleged by the Fabri-Steel Co. to have been made in its bid dated April 6, 1947, which was accepted on May 22, 1947. You request a decision as to the action to be taken in the matter. The Department of the Interior, Bureau of Reclamation, Denver, Col., invited bids under Specification No. 1746-to be opened April 8, 1947-for furnishing one lot of trashracks for Horsetooth Dam, item 2. Paragraph 14 of the Special Conditions specified that each bidder should state, in the blanks provided therefor in the schedule, the shipping points, freight classifications, and total shipping weights of the apparatus to be shipped under each freight classification from each shipping point involved, and that, under bids providing for delivery f. o. b. cars at the shipping point, all equipment, materials and supplies would be shipped on Government bills of lading and the total shipping weights, freight classifications, and shipping points stated by the bidder in his bid would be used in computing the delivered cost to the Government and in determining the low bid. In response to the invitation, the Fabri-Steel Co. submitted a bid dated April 6, 1947, wherein it offered to furnish item 2 for $1,544 f. o. b. cars Oakland, Calif., and specified the shipping weight as 15,750 pounds. By letters dated April 22 and May 12, 1947, the Bureau of Reclamation requested the company to confirm the weights and prices specified in its bid and, in reply of May 16, 1947, the company stated Regarding our bid of April 6, 1947, Spec. 1746 for trashracks, we wish to confirm the following weights and prices as quoted: Item #1 Weight 7200# price $715.00 FOB Shipping Point Combination bid for both Items #1 & 2 $2,215.00 F. O. B. Shipping Point. Award on item 2 was made to the Fabri-Steel Co. on May 22, 1947. By letter dated June 2, 1947, the company advised the Bureau of Reclamation as follows: Regarding the award made to this company for Item # 2 of Specifications #1746 for trashracks for the outlet works at Horsetooth Dam, Colorado Big Thompson Project, Colorado. We are faced with a serious problem and would like your advice on what can be done. Our estimator, W. Sjoberg, no longer in our employ, made an error on the take off for this project. His total weight for the ten racks was 15,190 lbs. The actual weight is 45,520 lbs. When your letter of May 12th reached us, we were unable to check the weights as we had no specification to go by. We were also unable to locate his takeoff sheet at that time as we were in the process of moving into our new location. We have, since however, located his take off and are enclosing it with his error marked in blue pencil. If we are forced to fulfill this contract, it will mean that we will take quite a loss, something that we cannot afford to do at the present time. We would appreciate hearing from you advising us of what course that we can take. The referred-to estimate sheet shows certain figures-apparently weights-under the heading "Horsetooth Dam" which total 1,519 and which was extended on the basis of a quantity of 10 to the total amount of 15,190. One of the figures comprising said total of 1,519 is 345 which figure is encircled by a blue pencil mark and in connection with which a notation appears "Error-should be 3395#." The invitation issued in the present case was clear and unambiguous as to the needs of the Government. The responsibility for the preparation of the bid submitted in response thereto was upon the bidder. See Frazier-Davis Construction Co. v. United States, 100 C. Cls. 120, 163. It is clear from the statements made by the company in its letter of June 2, 1947, that any error that may have been made in the bid was due solely to the lack of proper care on the part of the company in computing its bid, and was in no way induced or contributed to by the Government. See Steinmeyer et al. v. Schroeppel, 226 Ill. 9, 80 N. E. 564, wherein the court denied relief to appellant who had made a mistake in adding a column of figures representing the extensions of items on which bids were requested and the error was not alleged until after award. The court stated with respect to the matter of the mistake, page 566, as follows: If it [the contract] can be set aside on account of the error in adding up the amounts representing the selling price, it could be set aside for a mistake in computing the percentage of profits which appellants intended to make, or on account of a mistake in the cost of the lumber to them, or any other miscalculation on their part. If equity would relieve on account of such a mistake there would be no stability in contracts, and we think the Appellate Court was right in concluding that the mistake was not of such a character as to entitle the appellants to the relief prayed for. It is clear that such mistake as was made by the company in its bid was unilateral-not mutual—and, therefore, does not entitle the company to relief. See Saligman et al. v. United States, 56 F. Supp. 505, 507; and Ogden & Dougherty v. United States, 102 C. Cls. 249, 259. Moreover, the company was requested to verify its bid as to weights and prices, and in reply it confirmed the weights and prices specified in its bid. After such verification, the contracting officer was under no obligation to make further inquiry as to the correctness of the bid. See Carnegie Steel Company v. Connelly, 89 N. J. L. 1, 97 A. 774, and Shrimpton Manufacturing Company v. Brin, 59 Tex. Civ. App. 352, 125 S. W. 942. The fact that the acceptance of the bid was not made until after the company had been given an opportunity to verify its bid, precludes any assumption that the contracting officer exercised bad faith or attempted to take advantage of the company. See 10 Comp. Gen. 388; 14 id. 453; and 18 id. 942. Although, after award, the company furnished its estimate sheet in support of its claim of error, it does not appear that, prior to award, the contracting officer was aware of the factors used by the company in computing its bid. The present record indicates that the acceptance of the bid was in good faith, no error having been alleged by the company until after award. The acceptance of the bid, under the circumstances involved, consummated a valid and binding contract which fixed the rights and liabilities of the parties thereto. See United States v. New York and Porto Rico Steamship Co., 239 U. S. 88; United States v. Purcell Envelope Co., 249 U. S. 313; and American Smelting and Refining Co. v. United States, 259 U. S. 75. Accordingly, I find no legal basis for modifying the contract based on the bid of the Fabri-Steel Co. which was accepted; hence, the company should be required to furnish the trashracks under item 2 of its bid on the basis specified in its bid. The papers are returned herewith. (B-66821) STATE OR LOCAL IMPROVEMENTS-ASSESSMENTS AGAINST An assessment for street improvements levied by a municipal improvement district created under the laws of the State of Idaho against land owned by the United States within such district is to be regarded as an involuntary exaction and, as such, constitutes a tax which the United States is not required to pay. Acting Comptroller General Yates to L. W. Darby, Department of Agriculture, July 17, 1947: Reference is made to your letter of May 29, 1947 (A Disbursement Vouchers), submitting a voucher together with related papers, stated in favor of the City of Burley, Idaho, in the amount of $208.89 for assessments for street improvements levied against the United States as owner of Lot 14, Block 164, Burton's First Addition, City of Burley, Idaho, occupied by the Forest Service as an administrative site for the Minidoka National Forest. The record shows that on May 27, 1946, the City Council of Burley adopted a resolution providing for the creation of a local improvement district within the corporate city limits and that the Government site here in question is within the said improvement district. In a statement by the Acting Forest Supervisor on the reverse side of the voucher recommending approval of the voucher for payment it is stated, as follows: Some 5 or 6 years ago a light oiled surface was placed on the street with insufficient base. This surface has broken up causing difficult and dangerous travel conditions during periods of wet weather. The ground in this vicinity is extremely level making it difficult to get proper drainage. These street improvements will remedy this situation since storm sewers are being installed in connection with the curb and gutter project. During periods of dry weather the dust condition was a menace to safe travel along this street, and has a damaging effect on the exterior and interior of buildings and landscaping. The street improvement work will eliminate these hazards and damaging conditions. Title to the Burley Administrative site extends to the center of the street. The street improvement work consists of: 1. Regrading, regraveling and oiling. 2. Construct, reconstruct, and renew curbs gutter along each side of every street within the improvement district established. The City of Burley let the job out on competitive bid and the contract was awarded to the lowest bidder. It is to the advantage of the Government to reimburse the City on a cost basis, rather than to contract separately for doing the job. You will observe from the voucher itemization that the price paid to the City is less by $26.11 than it would have cost the Government to hire this contractor to do the job at the same rates as those charged the City of Burley. These rates are the lowest obtainable. It is a well settled rule that lands owned by the United States cannot be taxed by a State or by any of the political subdivisions of a State. Van Brocklin v. Tennessee, 117 U. S. 151; United States v. Power County, Idaho, 21 F. Supp. 684; cf. Pacific Spruce Corp. v. Lincoln County, 21 F.2d 586. This rule applies with equal force where the tax is a special tax or assessment for local improvements as well as in the case of a general property tax against lands owned by the United States. Lee v. Osceola and Little River Road Improvement District, 268 U. S. 643; Mullen Benevolent Corporation v. United States, 290 U. S. 89; United States v. Anderson Cottonwood Irrigation District, 19 F. Supp. 740; 18 Comp. Gen. 562. Cf., also, People of Puerto Rico v. United States, 134 F. 2d 267. A special assessment is a tax within the rule precluding a State from taxing lands owned by the United States, because it is an exercise of the sovereign power of taxation and, like other taxes, is an involuntary exaction. See United States v. Anderson Cottonwood Irrigation District, supra; Hagar v. Reclamation District, 111 U. S. 701. Notwithstanding the various theories advanced in your letter as being favorable to payment of the amount claimed on the voucher the conclusion is required that the claim presented is essentially a demand by the City of Burley for the payment of an assessment for street improvements against land owned by the United States; and, as was stated in 18 Comp. Gen. 562, an assessment of that type "is an involuntary exaction, and as such is a tax which the United States may not be required to pay." The various sections of Idaho Statutes authorizing the creation by municipal action of improvement districts such as here involved for the purpose of making street improvements and other similar purposes are found in sections 49-2501 to 49-2560 Idaho Code annotated, 1932, formerly sections 3911-4151 Idaho Compiled Statutes, 796802-48 1919. The first step is an ordinance declaring the intention to create the improvement, describing the section to be improved, estimating the cost, and declaring that the cost is to be assessed against the contiguous property. Protests may be made and are to be heard and considered, and thereafter an ordnance is passed creating the district and providing for taxation and assessment of the cost upon all parcels of land within the district in proportion to benefits. Assessments made to pay the cost of the improvements constitute liens. against the property assessed. The earlier statutory provisions cited above were considered by the Supreme Court of the United States in the case of Mullen Benevolent Corporation v. United States, supra. In that case suit was brought under the Tucker Act, 24 Stat. 505, by the holder of improvement bonds issued by a local improvement district in Idaho to finance sidewalk and sewer construction, and it was sought to collect the balance due on the basis of a reassessment made after certain of the property benefited had been acquired by the United States. The Supreme Court of the United States held that assessments of a local district, an adjunct of an incorporated city such as there involved, for street improvements were taxes and that the Government was not liable for assessments levied after it acquired title. In denying the claim the court stated at page 91, "But as the land was then owned by the United States, the assessment was a nullity. Van Brocklin v. Tennessee, 117 U. S. 151." In a similar case in 1925, Lee v. Osceola & Little River Road Improvement District, supra, this immunity to assessment for local improvements was extended to annul a reassessment made after the property had been conveyed by the United States to private owners, the improvements having been completed and the first assessment made while the land was owned by the United States. In the situation involved in B-22714, March 19, 1942, referred to in your letter, construction of the sewer with the privilege to the Government of connecting to it was in practical effect a specific service necessary to the use, occupation and operation of the buildings there involved. While in the present case an improved road may be more desirable than the old road, yet its construction was not necessary to the Government's continued use and occupancy of the adjacent property. Hence, the assessment made in the present case cannot be viewed as a claim for a service such as involved in the said decision of March 19, 1942. Accordingly, certification of the voucher is not authorized. |