B-127426, MAY 15, 1956, 35 COMP. GEN. 641

B-127426, MAY 15, 1956, 35 COMP. GEN. 641

COMPENSATION - WITHHOLDING - MEDICAL AND HOSPITAL INSURANCE PREMIUMS - PAYROLL DEDUCTIONS THE COLLECTION OF MEDICAL AND HOSPITAL INSURANCE PREMIUMS BY MECHANIZED PAYROLL DEDUCTIONS FROM FEDERAL EMPLOYEES' COMPENSATION, IN THE ABSENCE OF SPECIFIC STATUTORY AUTHORITY, INSTEAD OF COLLECTION BY DESIGNATED CLERICAL EMPLOYEES DURING OFFICIAL WORKING HOURS IS NOT ONLY IN CONTRAVENTION OF SECTION 3477, REVISED STATUTES, WHICH PROHIBITS ASSIGNMENT OF CLAIMS, SECTION 3620, WHICH REQUIRES PUBLIC MONEYS TO BE DRAWN ONLY IN FAVOR OF THE PERSONS TO WHOM PAYMENT IS MADE, AND SECTION 3678, WHICH REQUIRES APPROPRIATIONS TO BE USED ONLY FOR THE OBJECTIVES FOR WHICH THEY ARE MADE, BUT ALSO VIOLATES THE GENERAL PUBLIC POLICY AGAINST MAKING THE GOVERNMENT A COLLECTION AGENCY FOR PRIVATE ORGANIZATIONS.

TO THE ATTORNEY GENERAL, MAY 15, 1956:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 21, 1956, INQUIRING WHETHER OUR OFFICE WOULD OBJECT TO THE COLLECTION OF PREMIUMS FROM CLERICAL EMPLOYEE MEMBERS OF THE SPECIAL AGENTS MUTUAL BENEFIT ASSOCIATION BY MEANS OF MECHANIZED PAYROLL DEDUCTIONS.

YOUR LETTER INDICATES THAT THE SPECIAL AGENTS MUTUAL BENEFIT ASSOCIATION IS AN ASSOCIATION COMPOSED EXCLUSIVELY OF EMPLOYEES OF THE FEDERAL BUREAU OF INVESTIGATION FOR THE PURPOSE OF PROVIDING, THROUGH AN UNDERWRITING INSURANCE COMPANY, HOSPITALIZATION AND SURGICAL PROTECTION FOR THE MEMBER EMPLOYEES AND THEIR FAMILIES. IT FURTHER INDICATES THAT, WHILE MEMBERSHIP ORIGINALLY WAS LIMITED TO SPECIAL AGENTS WHO PAY THEIR PREMIUMS BY MAIL DIRECTLY TO THE OFFICE OF THE ASSOCIATION, MEMBERSHIP WAS BROADENED ON FEBRUARY 21, 1956, TO INCLUDE CLERICAL EMPLOYEES OF THE FEDERAL BUREAU OF INVESTIGATION. THE PREMIUMS OF APPROXIMATELY 3,600 CLERICAL EMPLOYEE MEMBERS ARE COLLECTED EACH PAYDAY BY DESIGNATED CLERICAL EMPLOYEES DURING REGULAR WORKING HOURS AND IT IS STATED THAT, SINCE THE PAYROLL OPERATION OF THE FEDERAL BUREAU OF INVESTIGATION IS A COMPLETELY MECHANIZED PROCEDURE, CONSIDERABLE TIME AND EXPENSE WOULD BE SAVED IF THESE PREMIUMS COULD BE COLLECTED BY MECHANICAL PAYROLL DEDUCTIONS.

THE UTILIZATION OF THE SERVICES OF FEDERAL EMPLOYEES DURING OFFICIAL WORKING HOURS FOR THE COLLECTION OF FUNDS FOR VARIOUS CHARITY DRIVES AND OF MONTHLY PAYMENTS FOR GROUP HOSPITALIZATION, INC.--- AN ORGANIZATION APPARENTLY SIMILAR IN NATURE AND PURPOSE TO THE SPECIAL AGENTS MUTUAL BENEFIT ASSOCIATION--- HAS BEEN RECOGNIZED BY OUR OFFICE AS A PROPER EXERCISE OF ADMINISTRATIVE DISCRETION WITH RESPECT TO THE PERFORMANCE OF DUTY OF EMPLOYEES AND WE HAVE NOT QUESTIONED THE PRACTICE WHERE EMPLOYEES SO UTILIZED WERE NOT HIRED SPECIFICALLY FOR AND DID NOT DEVOTE SUBSTANTIAL PERIODS OF TIME TO SUCH PURPOSES. SEE B 119740, JULY 29, 1954, TO YOU.

HOWEVER, THE DIVERSION OF PORTIONS OF THE SALARIES OF FEDERAL EMPLOYEES BY MEANS OF PAYROLL DEDUCTIONS BEFORE PAYMENT TO THE EMPLOYEES IS, OF COURSE, AN ENTIRELY DIFFERENT MATTER. GENERALLY, SUCH DEDUCTIONS MAY BE MADE ONLY PURSUANT TO SPECIFIC STATUTORY AUTHORIZATION AS, FOR INSTANCE, THOSE NOW BEING MADE FOR FEDERAL INCOME TAXES, CERTAIN STATE INCOME TAXES, PAYMENTS UNDER THE FEDERAL EMPLOYEES GROUP LIFE INSURANCE ACT OF 1954, 5 U.S.C. 2091 NOTE, CIVIL SERVICE RETIREMENT CONTRIBUTIONS, ETC. SEVERAL PROPOSALS HERETOFORE HAVE BEEN MADE TO OUR OFFICE FOR ESTABLISHING PROCEDURES FOR PAYROLL DEDUCTIONS FROM THE COMPENSATION OF FEDERAL EMPLOYEES FOR UNION DUES, PAYMENTS TO CHARITABLE AND OTHER PRIVATE ORGANIZATIONS, AND FOR GROUP MEDICAL, HEALTH, AND LIFE INSURANCE ACTIVITIES. HOWEVER, ALL SUCH PLANS IN THE ABSENCE OF SPECIFIC AUTHORIZATION THEREFOR BY LAW WERE DISAPPROVED AS BEING IN CONTRAVENTION OF THE PROVISIONS OF SECTIONS 3477 AND 3620 OF THE REVISED STATUTES, AS AMENDED, 31 U.S.C. 203 AND 492, WHICH RESPECTIVELY (1) PROHIBIT THE ASSIGNMENT OF CLAIMS AGAINST THE UNITED STATES AND (2) REQUIRE THE PUBLIC MONEYS TO BE DRAWN ONLY IN FAVOR OF THE PERSONS TO WHOM PAYMENT IS TO BE MADE. THE PURPOSE AND INTENT OF SUCH PROVISIONS ARE THAT THE GOVERNMENT MUST DEAL ONLY WITH ITS OWN CREDITORS AND THAT IT MAY NOT BE HELD ACCOUNTABLE TO STRANGERS TO ITS TRANSACTIONS. ALSO SUCH PROCEDURES HAVE BEEN HELD TO CONTRAVENE SECTION 3678 OF THE REVISED STATUTES, AS AMENDED, 31 U.S.C. 628, WHICH PROVIDES IN PLAIN AND UNEQUIVOCAL TERMS THAT APPROPRIATIONS SHALL BE USED SOLELY TO ACCOMPLISH THE OBJECTIVES FOR WHICH THEY ARE MADE AND FOR NO OTHER PURPOSES, AND TO VIOLATE THE GENERAL PUBLIC POLICY AGAINST MAKING THE GOVERNMENT A COLLECTION AGENCY FOR PRIVATE ORGANIZATIONS. SEE 32 COMP. GEN. 572; 31 ID. 647; B-105819, DECEMBER 19, 1951.

ACCORDINGLY, IT MUST BE HELD THAT THE PROPOSED PAYROLL DEDUCTION PLAN IS NOT AUTHORIZED UNDER EXISTING LAW AND, THEREFORE, MAY NOT BE APPROVED BY OUR OFFICE.