master shall be awarded a contract or be a surety on a bond, or be a subcontractor or carrier on a star route; except, that a person who becomes a member of the immediate family of a postmaster or assistant postmaster after being awarded a contract or after being recognized as a subcontractor may continue to perform such contract and is eligible for a renewal contract. "Immediate family", as used in this section, means persons who are members of the same household or dependent upon the other for support.

(d) No contract for carrying mail will be made with any person who has entered or proposed any combination to prevent the making of any bid for carrying mail or who has agreed, or given or promised any consideration, to induce another person not to bid for such a contract.

(e) No contract will be made with a person known to have been convicted of a crime such as embezzlement, robbery, burglary, larceny, perversion or other notoriously immoral acts; known to have associated with known criminals; or known to have a record of serious moving traffic violations, unless he has since been rehabilitated and has become a responsible citizen.

(f) A married woman may contract or be surety as though she were unmarried where the laws of the State permit. When a woman bids or signs as surety, it must be stated whether she is married or single.

(ii) Knowledge of service factors. Bidders should familiarize themselves with:

(a) Service to be performed, including mileage and time required.

(b) Estimated weight and volume of mail to be carried and size of vehicle required.

(c) Condition of roads, including toll charges.

(d) Laws and regulations governing the operation of motor vehicles.

(e) Other circumstances affecting the cost of operation, without regard to the prevailing rate of pay or amount of bond specified.

(iii) Bonds. (a) Each proposal must be accompanied by a bond executed by a qualified surety company or by two or more individual sureties, each of whom must own real estate worth at least the face amount of bond required, over and above all debts, judgments, mortgages, executions, exemptions.

(b) As a part of the bond, the individual sureties must sign a statement showing the amount of real estate owned by them, a brief description of the real estate, its estimated market value, where it is situated, and in what county and State the titles are recorded.

(c) Where the laws of the State permit, a husband and wife owning real estate as tenants by the entireties, are acceptable as one surety provided both execute the bond. Any other two or more persons owning real estate as joint tenants, are acceptable as one surety, provided all parties concerned execute the bond. In these cases, at least one other qualified surety is necessary.

(d) The obligation under this bid bond is that the bidder will execute a contract with good and sufficient sureties and that service will be performed according to the contract. If an accepted bidder fails to enter into the prescribed contract or, after having executed a contract, fails to perform service in accordance with the contract, he and his sureties are liable for the amount of the bid bond.

(e) No proposal for the transportation of the mail shall be considered when accompanied by a bond executed on behalf of a surety by or through any organization of mail transportation contractors or an officer or employee of such organization, nor shall any such proposal be considered when a portion of the bond premium, a commission on the bond sale or any other thing of value accrues to any organization of mail transportation contractors, or officer or employee thereof as a result of the execution of the bond.

(f) The amount of bond required with the bid is stated in the advertisement.

(g) For list of surety companies, approved by the Treasury Department, acceptable on bonds and contracts, see latest Treasury Department notice in the FEDERAL REGISTER.

(3) Instructions to bidders. Postmasters must:

(i) Caution prospective bidders that their proposals must be completed and properly executed, include the required bonds, and must be mailed to reach the distribution and traffic manager within the time limit for the receipt of bids as shown in the advertisements.

(ii) Point out to bidders the instructions attached to the advertisements and on the proposal forms.

(iii) Suggest that bidders contact the proper transportation requirements and

procurement officer to obtain definite information regarding local conditions and services required.

(iv) Point out to prospective bidders the legal residence requirements. See Part 526 of this chapter.

(v) "Caution bidders not to submit bids with the expectation of having their pay readjusted if awarded a contract, as no increase will be allowed except for changed conditions as provided by law." See § 521.3 (h) (3).

(vi) Advise bidders that no claim for additional pay can be allowed which is based on alleged mistakes or misapprehensions as to service requirements.

(vii) Inform prospective bidders not to permit the use of their names unless they intend to carry the mail or supervise the service in person. Every bidder must sign a statement that his bid is made in good faith and with the intention of performing service if it is accepted.

(viii) Point out to bidders and individuals sureties the obligation under the bid bond. See subdivision (i) (a) of subparagraph (2) of this paragraph.

(ix) Suggest to bidders that if they plan to obtain corporate bid bond through a local agent, they make sure the agent has authority from the surety company to write this type of bond.

(4) Restriction on postmaster participation. Postmasters are official agents of the Post Office Department. They are liable to dismissal from office for:

(i) Acting as agents of contractors, subcontractors, or bidders, with or without compensation, in any negotiations relating to mail service.

(ii) Divulging the amount of any proposal which they have certified.

(5) Obtaining proposal forms. Proposal forms may be obtained from:

(i) Transportation requirements and procurement officer.

(ii) Postmasters at offices where advertisements are posted.

Similar forms, approved by the Department, are furnished by surety companies and distributed through local agents and postmasters directly to contractors and bidders.

(6) Submitting bids. Bids must be submitted as follows:

(i) Each proposal must be sent in a sealed envelope addressed:

Distribution and Traffic Manager, Post Office Department,

(City)

(City)

(State)

(ii) Bids must be mailed in time to reach the distribution and traffic manager at the address and within the time limit specified in the advertisement. Bids received after the time limit specified in the advertisement will not be considered unless they are received before the award of contract is made and it is determined that their failure to arrive on time was due solely to delay in the mail for which the bidder was not responsible.

(iii) If bond is to be executed by a surety company, the proposal should be properly prepared, other than the bond, and transmitted directly to the bonding company in ample time to have it completed and filed in the office of the distribution and traffic manager within the time limit stated in the advertisement.

(iv) When bond is to be executed by a surety company, the certificate as to bidder may be executed prior to the completion of the bond. (See certificate and note on back of proposal, Form 5468 "Star or Water Route Bid and Bond.")

(7) Time limitations. The following time limitations apply:

(i) No withdrawal of a bid will be allowed unless notice of withdrawal is received in the office of the director, transportation division, at least 24 hours before the expiration of the time limit stated in the advertisement.

(State)

(ii) The Post Office Department may award a contract at any time within 60 days after the date stated in the advertisement as the closing date for the receipt of bids. A contract may be awarded during an additional 60-day period on written consent of the bidder and his sureties at their bid price.

(d) Award of contracts—(1) Requirements for award. Contracts are awarded to the lowest responsible bidder who tenders sufficient guaranties for celerity, certainty, and security in the faithful performance of service in accordance with the terms of the advertisement. The Postmaster General shall not be bound to consider the bid of any person who has willfully or negligently failed to comply with the terms of a former contract.

The ac

(2) Execution of contract. cepted bidder will be required to execute a contract with good and sufficient sure

ties satisfactory to the Postmaster General. These sureties can be the same as those furnished on the bid bond.

Al

(3) Qualifications of sureties. though individual sureties on a contract are not required to be owners of real estate, they must be responsible persons and competent to perform the service required by the contract if called on to do so.

(4) Obligation of sureties on contract. Sureties on the contract are, in effect, co-contractors, and in event of default or removal of contractor, are responsible for continued operation of the service. They may also be called on to take over operation of the route in the event of death of the contractor. See § 521.3 (i) (4) (iv).

(5) Filing contract. The successful bidder must execute and file his contract with the transportation requirements and procurement officer within 60 days from the date of acceptance of bid.

(6) Reservations. The Postmaster General reserves the right to:

(i) Reject all bids on any route whenever the interest of the service requires.

(ii) Rescind the acceptance of a proposal at any time before the signing of the formal contract by a representative of the United States, without allowing indemnity.

(iii) Suspend the award of a contract for a period not exceeding 60 days after the date stated in the advertisement as the closing date for receipt of bids and allow a corresponding extension of time for the execution of the contract. It is not always possible to award contracts to be effective on the dates specified in the advertisements.

(iv) Reject bids accompanied by bonds on which there appears as surety the name of a person who is not responsible or who is barred from bidding for any reason.

(v) Disregard the bids of those persons who have not submitted proposals in good faith and do not intend to perform service in accordance with the terms of the advertisement.

(7) Tie bids. When the lowest acceptable bids are at the same rate, preference will be given to the present contractor if his is one of the tie bids. Otherwise, the selection will be made by lot.

(8) Certification. The contractor must certify that he has not employed any person to solicit or secure the contract

upon any agreement for a commission, percentage, brokerage, or contingent fees. He must agree not to discriminate against any employee or applicant for employment because of race, color, religion, or national origin.

(9) Oath of contractor. A contractor shall take the required oath when executing his contract.

(e) Contractor's responsibilities—(1) For providing equipment and maintaining. (i) The contractor must furnish adequate and suitable motor vehicles or other equipment necessary to carry the mail.

(ii) Unless otherwise specified, motor vehicles must be used. When road or weather prevent their use, other means of conveyance must be furnished.

(iii) Contracts for certain routes specify the size or number, or both size and number, of vehicles required. Contractors on such routes cannot be required to provide equipment and service in excess of that specified.

(iv) Contractors must maintain their vehicles in a safe and dependable condition and must keep them clean and tidy.

(v) If a truck is used to carry the mail, the director, transportation division, shall require the contractor to provide a truck, the body of which must be fully inclosed, waterproof, equipped with secure locking devices, such as key or combination locks, and kept locked en route between offices.

(2) For performing service. (i) Contractors must perform service on all scheduled days including holidays, unless otherwise specified in contracts.

(ii) The contractor must serve regularly post offices in operation on the date of the advertisement. Also, he must serve regularly post offices established after the date of the advertisement, as well as railroad stations and junction points, which may be included for supply on his routes, without additional compensation if there is no additional travel.

(iii) Contractors must agree in their contracts to deductions from their pay for all regularly authorized service not performed. See paragraph (g) (1) of this section.

(iv) Contractors must not carry mail on a railroad or electric car except as directed by the Bureau of Transportation.

(3) For giving preference to mail. (i) Contractors must transport the whole of the mail on each scheduled trip during the term of the contract unless otherwise specified. Where a contract specifies only certain classes of mail to be transported, the term the whole of the mail means all mail of the classes specified.

(ii) Star route contractors and carriers may transport passengers, freight, and express so long as it does not interfere with the transportation of the mail, provided all applicable Federal and State laws and regulations are complied with.

(iii) When sent as mail, packages must be carried as such and no charge shall be made by the carrier for transporting them.

(iv) Where permitted by law, the contractor may transport intoxicating liquors outside the mail if carrying them does not interfere with the transportation of the mail.

(v) Contractors and their drivers are prohibited from picking up hitchhikers while transporting the mail.

(4) For maintaining schedules. Contractors and carriers must:

(i)

(a) Carry the mail according to the schedule of departures and arrivals and within the running time stated in the advertisement under which the contract is made, unless the schedule is altered by authority of the transportation requirements and procurement officer. If the schedule is altered by a proper order, they must adhere to the altered schedule.

(b) Be allowed an equal amount of additional time on the schedule when more than 10 minutes is taken for opening and closing the mail at any post office, unless otherwise provided in the contract.

(c) Where specific instructions have been issued by the transportation requirements and procurement officer on routes serving large post offices and sectional centers, notify postmasters in advance by telephone collect of estimated delayed arrival due to breakdowns or other causes or when extra large volumes of mail are being carried.

(d) Operate on standard time unless otherwise specified.

(ii) Postmaster must not:

(a) Except in cases of emergency, deliver mail to carriers before scheduled departure time without permission from the postal service officer or the director, transportation division. When earlier delivery of mail to a carrier would be advantageous to the carrier, patrons on

86-085--68- -36

the route, or the mailing public, the postmaster may recommend to the postal service officer or the director, transportation division, that the carrier be permitted to leave before scheduled time. Star route carriers and dispatch clerks will conform to the closing times listed in post offices.

(b) Permit mail to be taken from the post office to be kept in a private home overnight.

(5) For operating vehicles according to law. Transportation by contractors of passengers or property other than mail is subject to the following:

(1) The award of a contract for the transportation of mail grants no special right or privilege to the contractor to transport passengers, freight, or express. If the contractor desires to transport passengers or cargo other than mail for compensation in interstate or foreign commerce, he must obtain authority from the Interstate Commerce Commission. If he desires to transport either in intrastate commerce, he must obtain authority from the State in which he will operate, if such authority is required by that State. He must comply with all laws and regulations of the State or States which apply to carriers of passengers and cargo for hire. If passengers are transported, the mail must be carried in a separate compartment so passengers will not have access to the mail.

(ii) Contractors must know and comply with interstate and intrastate laws governing the operation of motor vehicles. They must comply with all safety measures prescribed by State and Federal laws and regulations governing the operation of motor vehicles and with the Interstate Commerce Commission's Motor Carrier Safety regulations issued from time to time, to the extent stated in the advertisement and as required by the Post Office Department.

(6) For transporting postal officials and equipment. (i) Contractors and carriers must transport postal inspectors and other officials of the Postal Service, on presentation of their credentials, over regularly scheduled trips and between the points specified in the official statement of the route, if the conveyance used is suitable.

(ii) Bus companies are not required to transport postal inspectors and other officials except on vehicles carrying mail and between points where service is authorized.

(iii) The presence of a postal inspector in the carrier's vehicle or in the vicinity of the route shall not be revealed by the carrier to any person at any time.

(iv) Contractors must convey, without extra charge, all post office blanks, mail bags, lock and keys, and other postal supplies offered them. This does not include furniture, letter cases, mail boxes, and other similar items. Such equipment must not be shipped under penalty labels for transportation on star routes unless it has been determined in advance that the contractors involved are willing to perform the additional work without compensation. This does not prevent contractors from handling such equipment as freight or express.

(7) For providing carriers—(i) Qualifications. Carriers must be:

(a) Not less than 18 years of age. (b) Of good character, reliable, and trustworthy.

(c) Sufficiently educated to enable them to perform all required duties in a satisfactory manner.

(ii) Persons ineligible. The following are ineligible to serve as carriers on star routes: (a) All postal employees, including temporaries and substitutes.

(b) Members of the immediate families of postmasters and assistant postmasters as defined in paragraph (c) (2) (i) (c) of this section unless they become members of the immediate family after the contract was awarded.

(c) Persons undergoing sentences of hard labor imposed by a criminal court (out on parole or under suspended sentence).

(d) Persons with known criminal records involving moral turpitude dishonesty.

or

(e) Persons whose traffic records indicate that their driving motor vehicles would be hazardous.

(8) For identifying equipment. (i) The use of a sign or lettering reading, "United States Mail" or "U.S. Mail" is optional, but may be used only on vehicles that are actually carrying mail. If a sign is used, it must be removed when the vehicle is used exclusively for other purposes. If the lettering is painted on the vehicle, it must be covered when the vehicle is being used exclusively for other than mail service.

(ii) Vehicles that are painted red, white, and blue must have inscribed on both tractor or truck cab side doors in block letters at least 1 inch high, U.S. Mail Contractor. Trailers, so painted,

must also bear the same inscription in block letters at least 2 inches high on the front of the trailer, sufficiently high to be visible above the tractor unit.

(f) Renewal, extensions, and changes without advertising—(1) Renewals. A regular contract may be renewed for additional terms, without advertising, at the rate prevailing at the end of the contract.

(2) Extensions of contract period. A contract may be continued in force beyond its expressed term for a period of not more than 6 months. The extension of a contract also extends any subcontract in effect on the route.

(3) Changes in service. (1) The director transportation division may at any time issue orders extending, increasing frequency, and changing the line of travel, by allowing a pro rata increase in compensation for any increased service required. They may also issue orders curtailing, reducing frequency, discontinuing, or changing line of travel by allowing 1 month's extra pay on the amount of service eliminated, and not exceeding pro rata compensation for the service retained.

(ii) For contracts entered into prior to October 23, 1962, extensions during the contract term without the concurrence of the contractor may not exceed a net aggregate of 50 miles one way. If the contractor in such a contract agrees to a larger extension, then an extension during a contract term may be made not in excess of a net aggregate of 100 miles one way. The contractor's agreement to an extension greater than 50 miles must be evidenced in writing for contracts entered into on and after October 23, 1962. Extensions up to 100 miles one way may be unilaterally ordered provided the contract general provisions have been amended to read 100 instead of 50 miles.

(iii) Star route service may not be extended to take over a segment of a rural route unless the segment becomes detached from the rural route and it is impracticable for the rural carrier to serve such segment.

(iv) If the road usually traveled becomes impassable, the carrier must use the most available road to perform full service. He should immediately report the matter to the postmaster at the head of the route. See paragraph (h) (4) of this section.

(4) Changes in schedules. (1) Directors, transportation divisions, may issue orders changing schedules of departure