Office of Price Administration receives money to administer laws relating to prices and commodity consumption. All money thus appropriated is definitely earmarked.

Determining requirements is the responsibility of the using agency. Requirements drafted with the technical advice and assistance of its personnel flow from the various branches to the procurement office of the using agency. Should a requirement call for one of numerous articles in common use by two or more Government agencies, the purchasing officer of the using agency refers first to the General Schedules of Supply which include some 27,000 items within that category. The General Schedules of Supply are, in effect, separate catalogs or schedules of term contracts for stated periods of from 3 months to 1 year, covering 62 classifications of commodities ranging from handtools to chemicals and drugs, and the prices and names of contract suppliers for each item listed. The using agency's purchasing officer, by referring to the applicable General Schedule, simply orders under this existing contract. The use of General Schedule contracts is mandatory upon departments and independent establishments in the District of Columbia and certain field agencies specified in the individual catalogs.

Where General Schedule contracts do not exist to cover the item requisitioned, the procurement officer of the using agency may purchase, or transmit the request to the Procurement Division, depending upon appropriate procurement procedure established by the latter named organization. The Procurement Division issues instructions from time to time specifying those commodities which shall be centrally purchased, also applicable limitations.

Since certain commonly needed supplies are requisitioned regularly, the Procurement Division operates a warehouse, stocking some 1,800 items which the using agency's purchasing officer may draw upon as needed. Requisitions calling for any of the items in the Federal warehouse are transmitted to the Procurement Division for issuance of supplies.

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Certain purchases, such as printing, binding, and blankbook work, are required to be made through the Government Printing Office.2 Blank envelopes for use in the District of Columbia must be procured from the same source, whereas all other envelopes, plain and printed, must be purchased against Post Office Department contracts. Specified items like furniture, clothing, cotton textiles manufactured by the Federal Prison Industries must be purchased from that source;

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2 Act of Congress, approved January 12, 1895, as amended by act of March 1, 1919, 40 Stat. 1270 (U. S. C., title 44, sec. 111).

8 Act of Congress, approved June 7, 1924, 43 Stat. 592 (U. S. C., title 44, sec. 225). Act of Congress, approved June 26, 1906 (U. S. Code, title 39, sec. 355).

Act of Congress, approved May 27, 1930. Sec. 7, 46 Stat 392.

similarly, brooms, mops, and kindred products manufactured in work shops for the blind are secured from a Schedule of Blind-Made Products. Gasoline and oil for marine delivery are ordered through the Navy Department.'

Frequently, requisitions cover items involving small amounts of money. Here the Procurement Division has made policy determinations permitting purchase of certain commodities by the using agency within specified money limitations.

Various special purchasing programs also come within the scope of the central procurement system. The Red Cross purchasing program is an example, textiles, clothing, and medicinal supplies being procured for refugee relief abroad. The purchase of strategic and critical materials, consolidated procurement of Defense Housing equipment, and Lend-Lease purchasing are other vital special programs, of which the latter is by far the largest.

Speed in getting supplies is a matter of extreme urgency during periods of national emergency. As an illustration, the Selective Service System, responsible for recruiting millions of men to build up the Army to wartime strength, conducts its work primarily through field offices. These are engaged in preparing questionnaires, registration forms, induction notices, records, and in maintaining complete filing systems, necessitating a stream of vast quantities of supplies and equipment. An immediate need for training and developing hundreds of employees who could determine requirements and supervise supply needs presented itself. Accordingly, a manual was prepared and instructions issued. As a result, the organization could begin to function promptly.

Integrated with its main task of procuring supplies in both normal times and in periods of emergency are Procurement Division's related functions, like the disposal of surplus property, and maintenance of complete information on national traffic facilities so that efficient deliveries may be made. The Division procures the fuel for two central heating plants in the District of Columbia which heat Federal buildings, and coal and fuel oil for other Federal buildings both in the District of Columbia and nearby. The Procurement Division also executes major purchasing programs directly related to the war effort. Procedures necessarily are elastic; they must permit wide latitude and instantaneous change so that new emergency programs of considerable proportions may be provided for adequately.

An attempt has been made to present the procurement needs of Government agencies and to show generally how they are met. Pro

Act of Congress, approved June 25, 1938. 52 Stat. 1196 (U. S. C., title 41, sec. 46, 47, 48).

'Circular Letter No. 513, Procurement Division, dated October 30, 1941. General authority is contained in sec. 1 of Executive Order No. 6166.

cedures outlined in this chapter apply to formal procurement methods employed within the limits of section 3709. These methods are used today by all Federal agencies, except those specifically authorized by the President to negotiate war purchases. The latter expedient permits the use of more rapid, informal methods. Purchasing processes obtaining under the War Powers Acts will be discussed subsequently.

THE CONTRACT AND PURCHASE BRANCH

The Contract and Purchase Branch is entrusted with those duties and functions bearing directly upon the purchase of materials, supplies, and services. The Branch consists of the Purchase Division, the Central Traffic Service, and the Federal Catalog Division. So far as actual purchasing is concerned the Purchase Division is the key unit, the other two divisions performing the specialized traffic and cataloging functions.

Normal purchasing operations of the Purchase Division are of three principal types: Preparation of term contracts for goods and services listed in the General Schedule of Supplies, purchases for warehouse stock, and purchases for direct delivery to requisitioning agencies. Purchases are also regularly made from other Government departments, for example, the Government Printing Office for paper and ink, and the Federal Prison Industries for articles manufactured in the various Federal prisons. The Printing and Binding Section orders all Treasury Department printing, binding, and engraving from the Government Printing Office or the Bureau of Engraving and Printing; maintains budgetary records, checks on deliveries, and audits relevant invoices. In the main, printing and binding requirements procured from other than the above sources are purchased against Procurement Division term contracts.

Contrary to popular notion, a purchase involves a series of steps and procedures rather than a single operation. Normal purchase derives from the preparation of specifications adequately defining the items required, a determination of sources of supply and the preparation of bid invitations in that order. Bids in turn are received, opened, tabulated, and evaluated, after which contracts are prepared, approved, and awarded. Purchase orders and bills of lading must then be prepared and mailed to the contractor (successful bidder) directing delivery of the goods. Upon receipt of evidence of satisfactory delivery, vouchers are prepared authorizing payment to the contractor. Aside from the technical aspects of specifications, sources of supply, transportation, and price, each step advancing a purchase must be in strict accordance with all applicable provisions of law.

By special authority, certain purchasing programs, whether or not related to the war effort, are executed informally.

A detailed outline of the various operations required in making a typical purchase will aid in forming a clear picture of formal purchase procedures. For this purpose an open market purchase for direct delivery to the requisitioning agency has been selected. The several operations are depicted graphically and summarized in a flow chart, which denotes each step by a letter of the alphabet. Solid blocks of the chart represent units of the Procurement Division, while broken-line blocks designate outside Government agencies and business organizations. Each step is minutely explained below, and samples of all forms shown in italics appear in Appendix IV.

A. The purchase authority (Procurement Division Form No. 1), submitted by the ordering office of the requisitioning agency, is received in the Control Section, Purchase Division. Here the requisitioning agency's appropriation is examined and control records are set up. The requisition is then forwarded to the Chief of the Purchase Division.

B. The Chief of the Purchase Division reviews each order for policy determination and designates the appropriate Commodity Group (Purchase Section) to make the purchase, giving due regard to the avoidance of overloading any one group. Direct contact with the purchase authorities also enables the Chief to know what is being ordered, and makes it possible for him to direct the subsequent purchase steps taken by the Commodity Groups. Strict administrative control is thus attained at the outset of the purchase process. The purchase authority is now forwarded to the designated Commodity Group.

C. The Commodity Group records the purchase authority and examines and perfects the specifications of enumerated items. The text of the bid invitation is then drafted, and a mailing list (Procurement Division Form No. 23-A), indicating suppliers who are to receive bid invitations, is prepared.

D. The purchasing officer who heads the Commodity Group approves and signs the request for issuance of bid invitation, retains the purchase authority pending the making of recommendations of awards (step H), and forwards the remaining forms to the Duplicating Section.

E. In the event priority assistance is required to procure the requisitioned supplies, the purchase authority is forwarded to the Priorities Unit, which takes up the matter with the War Production Board. This action proceeds concurrently with the solicitation, tabulation, and evaluation of bids, as explained in steps F to H.

F. The Duplicating Section prepares and proofreads stencils for the combination invitation, bid, and acceptance (Standard Form No. 33), reproduces and assembles the required number of copies of this