May 6, 1992

Appeal of

PAUL A. MASON

Under Contract No. HCR 36230

PSBCA No. 2980

APPEARANCE FOR APPELLANT

Paul A. Mason

APPEARANCE FOR RESPONDENT

Travis T. Lynch, Esq.

OPINION OF THE BOARD

This appeal is from a contracting officer's decision denying Appellant's claim for an economic price adjustment under the contract.

FINDINGS OF FACT

1. Appellant, Paul A. Mason, entered into a renewal of his highway transportation contract (HCR 36230) with the United States Postal Service (Respondent) for a term from July 1, 1990, to June 30, 1994, for highway transportation of mail between Anniston and Spring Garden, Alabama, at an annual contract rate of $26,500(Appeal File Tab (AF) 13, 14, 15). The contract incorporated Form 7407T, Basic Surface Transportation Services Contract General Provisions (id.).

2. Clause 11 of the General Provisions, "Adjustment of Compensation," provided that contract compensation could be adjusted by mutual agreement of the parties in accordance with Management Instruction PO-530-81-4, August 18, 1981, as amended, revised, or reissued as of the date of the adjustment (AF 13). The Management Instruction was incorporated by reference into the contract (AF 13, 21; Transcript of Hearing page (Tr) 12-13).

3. Under Part V, paragraph C of the Management Instruction a contractor could not seek an economic adjustment until the beginning of the 8th accounting period (each accounting period is 28 days) after the contract renewal date (AF 21).

4. The Management Instruction, after setting forth general principles and procedures, lists in Part VII.B. each of the various items on PS Form 7463 (the document used by contractors to apply for economic adjustments) along with standards for increases (see AF 21). For item 1B, Operational Cost, and Item 5, General Overhead Cost, the allowable increase is stated to be the 'amount determined by using procedures outlined in VII.D." (Id.) Paragraph VII.D. explains how to determine and apply the consumer price index for wage earners (CPIW) for the time periods involved (id.). For item 17, Contractor's Wages, Personal Driving or Supervision, the Management Instruction provides as follows:

"The allowable adjustment in contractor's wages granted solely for changed economic conditions is limited to the amount shown on the last approved cost statement multiplied by the percentage increase/decrease in CPIW since bid closing, renewal, subcontract, or last approved economic price adjustment, whichever is the latest."

5. On January 28, 1991 (which was roughly the commencement of the 8th accounting period from the contract renewal), Appellant applied for an economic adjustment of $2,594.30 (AF 7, 9; Tr 23).

6. On February 25, 1991, the Contracting Officer, after review of Appellant's request, offered Appellant an economic adjustment of $642 (AF 7).

7. The difference between the amounts as requested by Appellant and as granted by the Contracting Officer are in Items 1B, 5 and 17 of PS Form 7463 (AF 7; Tr 32). The Contracting Officer awarded increases in those items in accordance with the consumer price index increase from June 1990 (time of contract renewal) until the end of January 1991 (when the application for increase was made) (Tr 24-25; AF 7, 8).

8. This offer of the Contracting Officer was sent to Appellant who, in a letter dated March 12, 1991, requested reconsideration of it, citing the recent increase in postage rates )AF 6, 7).

9. On reconsideration, the Contracting Officer stated that the increase in postage rates had no effect on any increase under the contract and that the offer would not be changed (AF 5).

10. In reply, Appellant, in a letter dated March 18, 1991, increased his request for a contract adjustment to $12,000 (AF 4). There was no explanation in the letter as to the basis for the $12,000 claimed increase.

11. In a final decision dated March 20, 1991, the Contracting Officer denied Appellant's claim and stated that increases to Items 1B, 5 and 17 were limited to CPIW increases and that a total increase of $642 was the maximum allowance under regulations and procedures applicable to Appellant's contract (AF 3).

12. Appellant appealed that decision to the Board (AF 2).

DECISION

Appellant has not explained the basis for his claim of $11,358 (i.e., $12,000 minus $642 allowed by the Contracting Officer). Appellant did not appear at the hearing or file a post hearing brief setting forth his legal position.

The amount granted by the Contracting Officer for the economic price adjustment of Appellant's contract was correctly computed in accordance with the contract provisions (see Findings 2, 3, 4, 7).

Moreover, we find nothing in the record that would provide a basis for Appellant's claim, or for any further increase in the economic price adjustment of the contract.

Accordingly, the appeal is denied.

James E. Lemert

Administrative Judge

Board Member

I concur

James A. Cohen

Administrative Judge

Chairman

I concur

James D. Finn, Jr.

Administrative Judge

Vice Chairman