[Refunds of Interest Erroneously Charged by Forest Service]

The Secretary of Agriculture requested an opinion on how the Forest Service should implement a Board of Contract Appeals decision that the Service had been overcharging contractors for interest due on late payments under its standard timber sale contract. Potential contractor claims for refunds could total as much as $3.5 million and could impose an inequitable burden if they are paid from Forest Service appropriations. GAO found that: (1) the interest collections were deposited in the Department of the Treasury's general fund as miscellaneous receipts; (2) since the Forest Service did not benefit from the interest collections in question, it should not have to pay the refunds from its appropriations; and (3) the refunds can be properly charged to an appropriation established for the refunding of such erroneously received funds. Accordingly, the Forest Service may proceed to make refunds of interest overpayments to those contractors which it determines to be governed by the decision.