A-29338, SEPTEMBER 22, 1930, 10 COMP. GEN. 131

A-29338: Sep 22, 1930

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DEPARTMENTS AND ESTABLISHMENTS - SERVICES BETWEEN WHERE THE SERVICES OF AN INSPECTOR OF ORDNANCE OF THE WAR DEPARTMENT ARE LOANED FOR A FEW DAYS TO INSPECT ORDNANCE FOR THE NAVY DEPARTMENT THERE IS NO BASIS FOR CHARGING THE NAVY APPROPRIATION AND CREDITING THE ARMY APPROPRIATION WITH THE AMOUNT OF THE SALARY OF THE INSPECTOR FOR THE PERIOD INVOLVED. WAS DISAPPROVED FOR PAYMENT FOR THE REASON THAT SUCH SALARY SUPPOSEDLY WOULD HAVE BEEN PAID BY THE WAR DEPARTMENT IF HIS SERVICES HAD NOT BEEN LOANED TO THE NAVY DEPARTMENT. IS. NO GENERAL APPROPRIATION IS MADE FOR THE PAYMENT OF THE SALARIES OF ORDNANCE EMPLOYEES AT ORDNANCE ESTABLISHMENTS. THAT IS AVAILABLE FOR ORDNANCE ESTABLISHMENTS. IS FOR THE FULFILLMENT OF A DEFINITE ACTIVITY OR THE PROCUREMENT OF SOME SPECIFIC ARTICLES.

A-29338, SEPTEMBER 22, 1930, 10 COMP. GEN. 131

DEPARTMENTS AND ESTABLISHMENTS - SERVICES BETWEEN WHERE THE SERVICES OF AN INSPECTOR OF ORDNANCE OF THE WAR DEPARTMENT ARE LOANED FOR A FEW DAYS TO INSPECT ORDNANCE FOR THE NAVY DEPARTMENT THERE IS NO BASIS FOR CHARGING THE NAVY APPROPRIATION AND CREDITING THE ARMY APPROPRIATION WITH THE AMOUNT OF THE SALARY OF THE INSPECTOR FOR THE PERIOD INVOLVED.

DECISION BY COMPTROLLER GENERAL MCCARL, SEPTEMBER 22, 1930:

FURTHER CONSIDERATION HAS BEEN REQUESTED OF DECISION A-29338, DATED MARCH 12, 1930, IN SO FAR AS IT RELATES TO THE DISAPPROVAL FOR PAYMENT UPON PREAUDIT OF $190.94 OF THE SUM OF $222.74 PROPOSED TO BE PAID ON NAVY DEPARTMENT PUBLIC VOUCHER NO. 820 IN FAVOR OF THE CHIEF OF FINANCE, WAR DEPARTMENT, ON ACCOUNT OF THE INSPECTION OF AMMUNITION FOR THE NAVY DEPARTMENT BY JAMES KELLEY, AN EMPLOYEE OF THE WAR DEPARTMENT AT THE PLANT OF THE WESTERN CARTRIDGE CO., EAST ALTON, ILL., MAY 24, 1929, TO JUNE 8, 1929.

THE AMOUNT APPROVED FOR PAYMENT ON THE VOUCHER, $31.80, AS ADDITIONAL EXPENSE INCURRED BY THE WAR DEPARTMENT ON ACCOUNT OF THE WORK PERFORMED FOR THE NAVY DEPARTMENT REPRESENTS PER DIEM IN LIEU OF SUBSISTENCE AT THE RATE OF $2.40 FOR THE PERIOD FROM 3:15 P.M. MAY 24, 1929, TO MIDNIGHT, JUNE 6, 1929. THE BALANCE OF THE CLAIM, INCLUDING THE AMOUNT OF SALARY PAID MR. KELLEY BY THE WAR DEPARTMENT FOR THE PERIOD INVOLVED, WAS DISAPPROVED FOR PAYMENT FOR THE REASON THAT SUCH SALARY SUPPOSEDLY WOULD HAVE BEEN PAID BY THE WAR DEPARTMENT IF HIS SERVICES HAD NOT BEEN LOANED TO THE NAVY DEPARTMENT, AND THEREFORE THAT SUCH SALARY PAYMENT DID NOT APPEAR TO BE AN INCREASED EXPENSE ACTUALLY INCURRED BY THE LOAN OF THE SERVICES. SEE 7 COMP. GEN. 709, AND DECISIONS CITED THEREIN. RELATIVE TO THIS PHASE OF THE MATTER, A LETTER FROM THE CHIEF OF ORDNANCE, WAR DEPARTMENT, TO THE CHIEF OF FINANCE UNDER DATE OF JUNE 18, 1930, IS, IN PART, AS FOLLOWS:

2. NO GENERAL APPROPRIATION IS MADE FOR THE PAYMENT OF THE SALARIES OF ORDNANCE EMPLOYEES AT ORDNANCE ESTABLISHMENTS. ALL OF THE MONEY APPROPRIATED FOR THE ORDNANCE DEPARTMENT, THAT IS AVAILABLE FOR ORDNANCE ESTABLISHMENTS, IS FOR THE FULFILLMENT OF A DEFINITE ACTIVITY OR THE PROCUREMENT OF SOME SPECIFIC ARTICLES. THE SALARY OF EVERY EMPLOYEE AT AN ORDNANCE ESTABLISHMENT IS CHARGED AGAINST SOME SPECIFIC PRODUCTION ORDER OR SOME SPECIFIC ACTIVITY OF THE ORDNANCE DEPARTMENT. THE COST OF PRODUCTION AND OTHER ORDNANCE ACTIVITIES IS ESTIMATED IN ADVANCE AND THE MONEY APPROPRIATED BY THE CONGRESS IS FOR THE PRODUCTION OF SPECIFIC ARTICLES AND OTHER ACTIVITIES THAT ARE TO BE COMPLETED BY THE ORDNANCE DEPARTMENT WITH THE FUNDS APPROPRIATED. NO REFERENCE IS MADE TO THE NUMBER OF EMPLOYEES OR THE SALARY THEY WILL RECEIVE. EACH ORDNANCE ESTABLISHMENT DETERMINES THE NUMBER OF EMPLOYEES IT WILL USE. THIS NUMBER DEPENDS UPON THE AMOUNT OF PRODUCTION AND OTHER ORDNANCE ACTIVITIES THAT ARE TO BE UNDERTAKEN. AN ATTEMPT IS MADE TO SO SCHEDULE THE WORK AT EACH ESTABLISHMENT THAT THE NUMBER OF EMPLOYEES DOES NOT FLUCTUATE TO A VERY GREAT EXTENT. THIS INCREASES THE MORALE AND EFFICIENCY OF THE ESTABLISHMENT. HOWEVER, IT IS NOT ALWAYS POSSIBLE TO KEEP THE NUMBER OF EMPLOYEES CONSTANT AND IT IS QUITE EVIDENT THAT WHEN THERE IS A SCARCITY OF WORK THE FORCE HAS TO BE REDUCED. SINCE THE EMPLOYEES CAN ONLY BE PAID THEIR SALARY FROM THE MONEY APPROPRIATED TO DO SOME SPECIFIC WORK IT IS QUITE APPARENT THAT IF THERE IS NO WORK TO BE PERFORMED THERE ARE NO FUNDS AVAILABLE FOR THE SALARY OF AN EMPLOYEE. FROM THIS IT FOLLOWS THAT IF MORE EMPLOYEES ARE KEPT ON THE PAY ROLL OF ANY ORDNANCE ESTABLISHMENT THAN THE WORK PERFORMED AT THE ESTABLISHMENT WARRANTS THERE WILL BE AN EXCESSIVE COST FOR THE WORK PERFORMED. SINCE THE ESTIMATED COST OF THE WORK WAS BASED UPON AS ECONOMIC A METHOD OF OPERATION AS POSSIBLE AND THE FUNDS APPROPRIATED ON THIS BASIS, THE NUMBER OF ARTICLES MANUFACTURED OR THE ACTIVITY UNDERTAKEN WILL HAVE TO BE CURTAILED IF ANY EXCESSIVE NUMBER OF EMPLOYEES ARE KEPT ON THE PAY ROLL.

3. IN THE PRESENT INSTANCE, MR. KELLY WAS A MACHINIST AT FRANKFORD ARSENAL. HE WAS EMPLOYED BY FRANKFORD ARSENAL BECAUSE THERE WAS ENOUGH PRODUCTION ORDERS AT THAT ESTABLISHMENT TO REQUIRE HIS SERVICES. HE WAS NOT A PERMANENT EMPLOYEE OF THE ORDNANCE ESTABLISHMENT BECAUSE NO EMPLOYEES OF ORDNANCE ESTABLISHMENTS ARE PERMANENT AND NONE ARE RETAINED ON THE PAYROLL UNLESS THE WORK AT THE ESTABLISHMENT REQUIRES IT.

4. MR. KELLY WAS DETAILED ON INSPECTION WORK AT THE WESTERN CARTRIDGE COMPANY. HE WAS INSPECTING CALIBER .30 AMMUNITION WHICH HAD BEEN ORDERED BY FRANKFORD ARSENAL. HIS SALARY WAS CHARGED TO THE PROCUREMENT OF THAT AMMUNITION. AT THE COMPLETION OF THE INSPECTION OF THE AMMUNITION FOR FRANKFORD ARSENAL THE NAVY DEPARTMENT REQUESTED THE SERVICES OF MR. KELLY AS INSPECTOR ON SOME AMMUNITION WHICH THEY HAD ORDERED FROM THE WESTERN CARTRIDGE COMPANY. THE ORDNANCE DEPARTMENT INSTRUCTED MR. KELLY TO REMAIN AT THE WESTERN CARTRIDGE COMPANY AND TO INSPECT THE AMMUNITION FOR THE NAVY DEPARTMENT. THE QUESTION TO BE DECIDED IS WHAT FUNDS WILL BE USED TO PAY FOR THE SERVICES OF MR. KELLY WHILE INSPECTING AMMUNITION FOR THE NAVY DEPARTMENT. AS STATED BEFORE, THE ORDNANCE DEPARTMENT HAS NO GENERAL APPROPRIATION FOR THE SALARY OF EMPLOYEES AT ORDNANCE ESTABLISHMENTS. THE ORDNANCE DEPARTMENT IS REQUIRED TO PAY THE SALARY OF MR. KELLY WHILE HE WAS INSPECTING AMMUNITION FOR THE NAVY DEPARTMENT IT WILL HAVE TO BE CHARGED TO THE ORDER FOR THE PROCUREMENT OF AMMUNITION FOR THE REGULAR ARMY. AN EXCESSIVE CHARGE OF THIS KIND RESULTS IN A DECREASED AMOUNT OF AMMUNITION FOR THE ARMY. THE FACT THAT THE NAVY DEPARTMENT HAD THE AMMUNITION INSPECTED WITHOUT COST RESULTS IN A REDUCED COST OF THE NAVY AMMUNITION AND THEREFORE AN INCREASED AMOUNT OF AMMUNITION FOR THE SAME MONEY. IF CARRIED TO THE EXTREME, AND UNLESS NAVY FUNDS PAY FOR THE SALARY OF MR. KELLY WHILE INSPECTING AMMUNITION FOR THE NAVY DEPARTMENT IT MAY BE CARRIED TO THE EXTREME, THE ORDNANCE DEPARTMENT COULD PAY THE SALARY OF MEN WORKING ON AMMUNITION ORDERS FOR THE NAVY DEPARTMENT, THUS GREATLY INCREASING THE QUANTITY OF AMMUNITION FOR THE NAVY DEPARTMENT, AND GREATLY REDUCING THE QUANTITY OF AMMUNITION AVAILABLE FOR THE ARMY. THIS, OF COURSE, WOULD COMPLETELY OBLITERATE ANY CALCULATIONS MADE BY THE CONGRESS FOR THE PROCUREMENT OF SPECIFIC AMOUNTS OF AMMUNITION FOR THE TRAINING OF THE ARMY AND THE NAVY, RESPECTIVELY.

5. IF MR. KELLY HAD RETURNED TO FRANKFORD ARSENAL UPON COMPLETING THE INSPECTION WORK FOR THE ORDNANCE DEPARTMENT AT THE WESTERN CARTRIDGE COMPANY HE WOULD HAVE BEEN DISCHARGED, OR THE MAN WHO TOOK HIS PLACE AT FRANKFORD ARSENAL WHILE MR. KELLY WAS AWAY WOULD HAVE BEEN DISCHARGED, IF THERE WAS NO WORK ON HAND TO WARRANT HIS RETENTION. IN OTHER WORDS, THE ORDNANCE DEPARTMENT WAS REQUIRED TO EMPLOY AND PAY THE SALARY OF ONE MAN MORE THAN WAS NECESSARY IN ORDER TO PRODUCE A SPECIFIC AMOUNT OF AMMUNITION FOR THE ARMY.

IN SHORT, THE CONTENTION IS THAT BY LOANING MR. KELLEY'S SERVICES TO THE NAVY DEPARTMENT FOR TWO WEEKS, THE WORK THAT HE OTHERWISE WOULD HAVE DONE HAD TO BE PERFORMED BY OTHER EMPLOYEES, AND CONSEQUENTLY, THAT IN THE FINAL ANALYSIS, AS A MATTER OF COST ACCOUNTING AMONG THE VARIOUS ORDNANCE PROCUREMENT PROJECTS, SOME PROJECT MUST HAVE BEEN CHARGED WITH THE COST OF SERVICES WHICH NEED NOT HAVE BEEN INCURRED IF MR. KELLEY'S SERVICES HAD NOT BEEN LOANED. MANIFESTLY, THIS IS TOO SPECULATIVE TO DETERMINE THAT THE WAR DEPARTMENT, AS A DEMONSTRATED FACT, ACTUALLY INCURRED AN INCREASED EXPENSE IN THE AMOUNT OF MR. KELLEY'S SALARY BY LOANING HIS SERVICES FOR THE SHORT TIME INVOLVED, PARTICULARLY IN VIEW OF THE FACT THAT THE APPROPRIATION INVOLVED IS A LUMP-SUM APPROPRIATION OF $4,000,000 MADE IN GENERAL TERMS FOR THE DEVELOPMENT, MANUFACTURE, PURCHASE, AND MAINTENANCE OF AMMUNITION, ETC. IN ANSWERING A SIMILAR CONTENTION ADVANCED ON BEHALF OF THE CHIEF OF ENGINEERS, UNITED STATES ARMY, IT WAS SAID IN DECISION A 31040, DATED MAY 6, 1930:

YOU MAY BE INFORMED, HOWEVER, THAT ON THE FACTS NOW BEFORE THIS OFFICE, THE PAYMENT IN QUESTION WAS NOT AUTHORIZED UNDER THE WELL ESTABLISHED RULE THAT ONE GOVERNMENT ACTIVITY MAY NOT BE REIMBURSED FOR SERVICES PERFORMED FOR ANOTHER EXCEPT TO THE EXTENT THAT IT IS SHOWN THAT INCREASED COSTS HAVE BEEN INCURRED. SUCH RULE IS NOT IN CONTRAVENTION OF SECTION 3678, REVISED STATUTES, REQUIRING ALL APPROPRIATIONS TO BE APPLIED SOLELY TO THE OBJECTS FOR WHICH THEY ARE MADE, BUT IS IN AID OF SUCH STATUTE, FOR UNLESS INCREASED COSTS HAVE ACTUALLY BEEN INCURRED BY THE PERFORMING ACTIVITY, THERE IS NOTHING TO BE PAID AND IF PAYMENT IS MADE MERELY ON SOME THEORETICAL, OR HYPOTHETICAL, OR ESTIMATED BASIS, WHERE NO ACTUAL INCREASED COSTS ARE SHOWN TO HAVE BEEN INCURRED, THE EFFECT IS TO AUGMENT THE APPROPRIATION OF THE PERFORMING ACTIVITY AT THE EXPENSE OF THE APPROPRIATION OF THE REQUESTING ACTIVITY, AND THUS TO APPLY THE APPROPRIATION OF THE REQUESTING ACTIVITY TO THE PURPOSES OF THE PERFORMING ACTIVITY IN CONTRAVENTION OF SAID SECTION 3678, REVISED STATUTES. THE APPLICATION OF SECTION 3679, REVISED STATUTES, AS AMENDED BY THE ACT OF FEBRUARY 27, 1906, 34 STAT. 48, CITED BY YOU, IS NOT APPARENT, AS THERE WOULD APPEAR TO BE NO QUESTION OF CREATING A DEFICIENCY IN THE APPROPRIATION IN THE ABSENCE OF A SHOWING THAT INCREASED COSTS HAVE ACTUALLY BEEN INCURRED BY THE PERFORMING ACTIVITY AS A RESULT OF THE LOANED SERVICE. YOUR EXPLANATION THAT SOMEWHERE UPON FINAL ANALYSIS SOME INCREASED COST MAY HAVE BEEN INCURRED BY THE CORPS OF ENGINEERS ON ACCOUNT OF THE INSPECTION OF THE LUMBER IS NOT SUFFICIENT TO AUTHORIZE CHARGING THE APPROPRIATIONS OF THE OFFICE OF PUBLIC BUILDINGS AND PUBLIC PARKS OF THE NATIONAL CAPITAL WITH THE SALARY OF THE INSPECTOR, WHICH WOULD HAVE BEEN PAID UNDER CORPS OF ENGINEERS APPROPRIATIONS IF SUCH INSPECTION HAD NOT BEEN MADE. THE PERFORMANCE OF SERVICES AT NO INCREASED COST BY ONE GOVERNMENT ACTIVITY FOR ANOTHER IS A MATTER OF COMITY IN THE INTEREST OF THE GOVERNMENT SERVICE GENERALLY AND IS NOT TO BE TREATED ON THE BASIS OF A COMMERCIAL ARRANGEMENT BETWEEN TWO UNRELATED PRIVATE BUSINESS ORGANIZATIONS.

WHAT WAS SAID THERE IS APPLICABLE HERE. IT IS NOT SHOWN THAT THE LOAN OF MR. KELLEY'S SERVICES FOR THE TWO WEEKS ACTUALLY REQUIRED ANY INCREASE IN THE NUMBER OF EMPLOYEES AT THE ARSENAL. FURTHERMORE, IT HAS BEEN HELD IN THIS CONNECTION THAT IN THE ABSENCE OF SPECIFIC LEGISLATION WITH REFERENCE THERETO, THERE IS NO AUTHORITY FOR DOING WORK FOR ANOTHER ESTABLISHMENT WHICH REQUIRES AN INCREASE IN THE PLANT OR THE NUMBER OF EMPLOYEES OF THE ESTABLISHMENT DOING THE WORK. 7 COMP. GEN. 709, 710.

ON THE FACTS PRESENTED, THE DECISION OF MARCH 12, 1930, WAS CORRECT AND WILL NOT BE MODIFIED.