LETTER TO MR. JAMES M. FREY FROM LYLE L. MILLER

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP81M00980R001800050049-5
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 19, 2016
• Sequence Number: 49
• Content Type: LETTER

OLC 78-0714/A
Approved For ReT EMOKWO4)FCaf WADI @@@Qd~P 100050049-5 ~,D b
2 JUtt 1078
Mr. James M. Frey
Assistant Director for
Legislative Reference
Office of Management and Budget
Washington, D.C. 20503
Dear Mr. Frey:
I am writing to express the concerns of the Central Intelligence
Agency regarding S. 2787, the "Contract Disputes Act of 1978." The bill
would establish a procedure for the resolution of claims and disputes
relating to Government contracts awarded by Executive agencies. The
policy enunciated by the bill--that contractor claims be resolved by
7rtutual agreement in lieu of litigation, if feasible--is laudable.
Hm ever, as outlined below, several provisions of the bill would lessen
the possibility of prompt and less-formal resolution of contractor claims.
Proposed section 7 of the bill would increase from 30 to 90 days the
tire- in which a contractor may appeal the decision of the contracting
officer. This proposal fails to take into account the realities of the
procurement process, whereby the contracting officer issues his decision
only after the differences between the Government and the contractor have
been thoroughly discussed and evaluated. Thus, the 30 days currently
authorized for appeals is more than adequate; and increasing the period
to 90 days would only result in unnecessary delay. Likewise, both
proposed paragraph 8 (f) (1) , which would grant a contractor 12 months
to appeal a decision of an agency board of contract appeals to the courts,
and proposed subsection 10(a), which would permit a contractor to by-pass
an agency board of appeals and appeal a contracting officer's decision
directly to the courts if he does so within a year, would unnecessarily
delay the dispute resolution procedure. The former provision also runs counter
to the policy enunciated in the bill of settling claims by means other than
litigation. In addition, because the board of appeals would be the surrogate
for the head of an agency, the latter provision would permit the contractor
to deny an agency head a review of the dispute. This Agency believes that
contractors should be required to exhaust their administrative remedies
before seeking redress in the courts.
MORI/CDF
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Similarly, subsections 9(c) and (d) would delay rather than expedite
the settlemement of small claims. Also objectionable are the provisions
of subsection 9(a) which make the small claims procedure available solely
at the option of the contractor, and 9(d) which denies the Government the
right to appeal to the courts.
In addition, the procedures in this bill which would. be established-
for judicial review of board decisions fail to recognize that a contract
dispute could involve sensitive national security information--that is,
information classified according to Executive Order or information
relating to intelligence sources and zr~ethods. It is the statutory
responsibility of the Director of Central Intelligence to protect the
latter from unauthorized disclosure (50 U.S.C. 403(d)(3)). The bill
should provide for in camera proceedings when such information is involved
and should make clear t at such information may not be made public..
.In short, the thrust of the bill is to place disproportionate-emphasis
on the interests of the contractor as opposed to those of the Government.
Its passage would result in forum-shopping; in unwarranted delays in claim
settlement, which would be detrimental to the Government; and could lead
to security problems. For these reasons, this Agency must object to the
changes the bill would make in current procedures for settling contract
disputes.
Sincerely,
Distribution:
Orig - Addressee
1 - OL/P 1S
1 - 0GC/LFPD
3) - OLC Subject
1 - OLC Chrono
OLC:JEC:sm (1 Jun 78)
1 - DDS&T
Approved For Release 2006/08/14: CIA-RDP81 M00980R001800050049-5