A-51969, NOVEMBER 24, 1933, 13 COMP. GEN. 150

A-51969: Nov 24, 1933

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DEPARTMENTS AND ESTABLISHMENTS - SERVICES BETWEEN - AIRPLANE TRANSPORTATION SINCE THE PAY OF OFFICERS AND ENLISTED MEN OF THE ARMY AND NAVY IS INCIDENT TO THEIR STATUS. THE USE OF GOVERNMENT AIRPLANE TRANSPORTATION SERVICE IS NOT AUTHORIZED BETWEEN DEPARTMENTS UNLESS IT CAN BE SHOWN THAT IT WOULD COST LESS THAN COMMERCIAL TRANSPORTATION AND IMPOSES NO ADDITIONAL EXPENDITURE UNDER APPROPRIATIONS IN PROCURING AIRPLANES TO ESTABLISH AND RENDER SUCH SERVICE. EXPENSES INCIDENT TO FLIGHTS MADE FOR THE FARM CREDIT ADMINISTRATION UNDER THE FOREGOING ARRANGEMENT WILL BE SUBJECT TO FINAL AUDIT BY THE GENERAL ACCOUNTING OFFICE. YOUR ADVANCE DECISION IS THEREFORE REQUESTED FOR THE GUIDANCE OF THIS OFFICE RELATIVE TO THE FOLLOWING: (A) WHAT ITEMS OF COST MAY BE ALLOWED AND PAID TO THE NAVY DEPARTMENT?

A-51969, NOVEMBER 24, 1933, 13 COMP. GEN. 150

DEPARTMENTS AND ESTABLISHMENTS - SERVICES BETWEEN - AIRPLANE TRANSPORTATION SINCE THE PAY OF OFFICERS AND ENLISTED MEN OF THE ARMY AND NAVY IS INCIDENT TO THEIR STATUS, RATHER THAN TO THE PERFORMANCE OF WORK, THEIR PAY AND ALLOWANCES, OTHER THAN FOR TRAVEL, SHOULD NOT BE CONSIDERED IN COMPUTING THE COST OF RENDERING INTERDEPARTMENTAL AIRPLANE TRANSPORTATION SERVICE. THE ITEMS OF COST WHICH MAY BE ALLOWED AND PAID TO THE NAVY DEPARTMENT BY THE FARM CREDIT ADMINISTRATION PURSUANT TO AGREEMENT ENTERED INTO BETWEEN THE TWO BRANCHES OF THE SERVICE UNDER THE TERMS OF SECTION 601 OF THE ECONOMY ACT OF JUNE 30, 1932, 47 STAT. 417, FOR AIRPLANE TRANSPORTATION SERVICE, WOULD INCLUDE ANY NECESSARY DIRECT EXPENSES INCURRED IN MAKING THE FLIGHTS SUCH AS GASOLINE, OIL, TRAVELING ALLOWANCES FOR PILOTS, STORAGE, IF ANY, FEES FOR LANDING, IF ANY, ETC. THE FACT THAT THE NAVAL OFFICER PILOT WOULD RECEIVE CREDIT FOR A FLIGHT, THEREBY OBVIATING THE NECESSITY FOR HIS PERFORMING ANOTHER FLIGHT AT THE EXPENSE OF THE NAVY TO MAKE UP HIS REQUIRED FLIGHT TIME, WOULD NOT NECESSARILY PRECLUDE CONSIDERING, AS ITEMS OF COST, ALL OF THE EXPENSES OF THE TRIP OTHER THAN THE PAY AND ALLOWANCES OF THE NAVAL OFFICER PILOTING THE PLANE. THE USE OF GOVERNMENT AIRPLANE TRANSPORTATION SERVICE IS NOT AUTHORIZED BETWEEN DEPARTMENTS UNLESS IT CAN BE SHOWN THAT IT WOULD COST LESS THAN COMMERCIAL TRANSPORTATION AND IMPOSES NO ADDITIONAL EXPENDITURE UNDER APPROPRIATIONS IN PROCURING AIRPLANES TO ESTABLISH AND RENDER SUCH SERVICE. THE COMPARISON OF COST SHOULD BE BASED ON THE RATES CHARGED BY COMMERCIAL AIR LINES.

COMPTROLLER GENERAL MCCARL TO THE GOVERNOR OF THE FARM CREDIT ADMINISTRATION, NOVEMBER 24, 1933:

THERE HAS BEEN RECEIVED YOUR LETTER OF NOVEMBER 8, 1933, AS FOLLOWS:

I AM INCLOSING HEREWITH COPIES OF THE CORRESPONDENCE RELATIVE TO THE USE OF ARMY AND NAVY AIRCRAFT BY CERTAIN OFFICIALS OF THE FEDERAL GOVERNMENT, AS FOLLOWS: LETTER OF OCTOBER 2 TO THE PRESIDENT FROM THE SECRETARY OF WAR, THE ACTING SECRETARY OF THE NAVY, AND THE SECRETARY OF COMMERCE; THE PRESIDENT'S MEMORANDUM OF OCTOBER 18 TO THE SECRETARY OF WAR; AND LETTER OF OCTOBER 20 TO ME FROM THE SECRETARY OF WAR.

THE FOURTH RECOMMENDATION MADE IN THE LETTER OF OCTOBER 2, READS AS FOLLOWS:

"FOURTH. THAT ALL EXPENSES INCIDENT TO FLIGHTS BE CHARGED TO THE DEPARTMENT OR AGENCY USING THE AIRCRAFT AND THAT TRANSFER OF FUNDS COVERING SAME BE ACCOMPLISHED MONTHLY.'

SECTION 601 OF THE ECONOMY ACT OF JUNE 30, 1932, PERMITS THE PERFORMANCE OF SERVICES BY ONE ESTABLISHMENT OF THE GOVERNMENT FOR ANOTHER ON THE BASIS OF THE ACTUAL COST OF THE SERVICES PERFORMED, SUBJECTTO THE PROVISO THAT, IF THE SERVICE CAN BE AS CONVENIENTLY OR MORE CHEAPLY PERFORMED BY PRIVATE AGENCIES, IT SHALL BE LET BY COMPETITIVE BIDS TO SUCH PRIVATE AGENCIES. EXPENSES INCIDENT TO FLIGHTS MADE FOR THE FARM CREDIT ADMINISTRATION UNDER THE FOREGOING ARRANGEMENT WILL BE SUBJECT TO FINAL AUDIT BY THE GENERAL ACCOUNTING OFFICE. YOUR ADVANCE DECISION IS THEREFORE REQUESTED FOR THE GUIDANCE OF THIS OFFICE RELATIVE TO THE FOLLOWING:

(A) WHAT ITEMS OF COST MAY BE ALLOWED AND PAID TO THE NAVY DEPARTMENT?

(B) IF A FLIGHT, OR A PORTION THEREOF, MADE FOR THIS OFFICE RELIEVES THE NAVAL OFFICER PILOT FROM THE PERFORMANCE OF ANOTHER FLIGHT, IN WHOLE OR IN PART, THAT WOULD BE REQUIRED UNDER THE LAW OR NAVY REGULATIONS, SHALL ALL THE EXPENSES OF SUCH FLIGHT, OR PORTION THEREOF, BE OMITTED FROM THE BILL FOR EXPENSES ON THE GROUND THAT THEY ARE PRIMARILY FOR THE PERFORMANCE OF A NAVY REQUIREMENT AND THAT THE CARRYING OF PASSENGERS TO A PARTICULAR DESTINATION IS SECONDARY AND INCIDENTAL?

(C) DOES THE PROVISO TO SECTION 601 OF THE ECONOMY ACT, OF JUNE 30, 1932, IMPOSE SUCH A RESTRICTION UPON THIS OFFICE THAT THE PERMISSIVE USE OF NAVY AIRCRAFT CANNOT BE AVAILED OF IF PRIVATE AGENCIES ARE ABLE TO RENDER THE SERVICE AS CONVENIENTLY OR MORE CHEAPLY, AND, IF SO, DOES THE BASIS OF NAVY COSTS FOR THE PURPOSE OF THIS COMPARISON INCLUDE ONLY THE NET AMOUNT TO BE PAID TO THE NAVY DEPARTMENT IN ACCORDANCE WITH YOUR ANSWERS TO (A) AND (B) ABOVE?

THE LETTER OF OCTOBER 2, 1933, APPROVED BY THE PRESIDENT OCTOBER 18, 1933, IS AS FOLLOWS:

IN COMPLIANCE WITH YOUR WISHES EXPRESSED AT THE CABINET MEETING ON SEPTEMBER 8TH, THE SECRETARIES OF WAR, NAVY, AND COMMERCE HAVE CONFERRED ON THE SUBJECT OF TRANSPORTATION BY GOVERNMENT AIRPLANES FOR CERTAIN OFFICIALS OF THE FEDERAL GOVERNMENT NOT CONNECTED WITH DEPARTMENTS CONTROLLING GOVERNMENT AIRCRAFT. WE RESPECTFULLY SUBMIT THE FOLLOWING RECOMMENDATIONS:

FIRST. THAT THE OFFICIALS LISTED BELOW, AND SUCH OTHERS AS THE PRESIDENT MAY SPECIFY, BE PERMITTED TO USE GOVERNMENT AIRPLANES FOR PASSENGER FLIGHTS WITHIN THE CONTINENTAL LIMITS OF THE UNITED STATES UPON WRITTEN APPLICATION TO THE HEAD OF ANY FEDERAL AGENCY CONTROLLING GOVERNMENT AIRCRAFT (I.E., WAR, NAVY):

MEMBERS OF THE CABINET,

THE DIRECTOR, BUREAU OF THE BUDGET,

THE CHAIRMAN OF THE BOARD OF THE RECONSTRUCTION FINANCE CORPORATION,

THE GOVERNOR OF THE FEDERAL FARM CREDIT ADMINISTRATION,

THE CHAIRMAN OF THE BOARD OF THE HOME OWNERS LOAN CORPORATION,

THE ADMINISTRATOR OF THE INDUSTRIAL RECOVERY ACT,

THE ADMINISTRATOR OF AGRICULTURAL ADJUSTMENT,

THE FEDERAL RELIEF ADMINISTRATOR,

THE DIRECTOR OF THE CIVILIAN CONSERVATION CORPS,

THE ADMINISTRATOR OF PUBLIC WORKS.

SECOND. THAT REQUESTS FOR FLIGHTS BE SUBMITTED IN WRITING IN AMPLE TIME TO PERMIT OF ALL ADMINISTRATIVE ARRANGEMENTS; THAT REQUESTS FOR AIRCRAFT BE LIMITED TO FLIGHTS INVOLVING URGENT GOVERNMENTAL BUSINESS AND THAT THE REQUESTS SO STATE.

THIRD. THAT THE USE OF AIRPLANES BY THE PERSONNEL IN THOSE DEPARTMENTS BY THE SECRETARIES OF SUCH DEPARTMENTS, TO INCLUDE AUTHORIZATION FOR FLIGHTS OF NONMILITARY PERSONNEL IN CASES OF EMERGENCY INVOLVING LIFE OR CATASTROPHE.

FOURTH. THAT ALL EXPENSES INCIDENT TO FLIGHTS BE CHARGED TO THE DEPARTMENT OR AGENCY USING THE AIRCRAFT AND THAT THE TRANSFER OF FUNDS COVERING SAME BE ACCOMPLISHED MONTHLY.

FIFTH. INASMUCH AS THE DEPARTMENT OF COMMERCE HAS NO AIRCRAFT AVAILABLE FOR THE TRANSPORTATION OF FEDERAL OFFICIALS OF OTHER DEPARTMENTS, AND IN ORDER TO EQUALIZE THE LOAD ON THE WAR AND NAVY DEPARTMENTS, THE FOLLOWING ALLOCATIONS ARE RECOMMENDED:

TO THE WAR DEPARTMENT:

THE SECRETARY OF THE TREASURY.

THE DIRECTOR, BUREAU OF THE BUDGET.

THE POSTMASTER GENERAL.

THE SECRETARY OF COMMERCE.

THE SECRETARY OF LABOR.

THE DIRECTOR, CIVILIAN CONSERVATION CORPS.

THE ADMINISTRATOR OF PUBLIC WORKS.

THE ADMINISTRATOR OF THE INDUSTRIAL RECOVERY ACT.

THE FEDERAL RELIEF ADMINISTRATOR.

TO THE NAVY DEPARTMENT:

THE SECRETARY OF STATE.

THE SECRETARY OF THE INTERIOR.

THE ATTORNEY GENERAL.

THE SECRETARY OF AGRICULTURE.

THE CHAIRMAN OF THE BOARD OF THE RECONSTRUCTION FINANCE CORPORATION.

THE CHAIRMAN OF THE BOARD OF THE HOME OWNERS LOAN CORPORATION.

THE GOVERNOR OF THE FEDERAL FARM CREDIT ADMINISTRATION.

THE ADMINISTRATOR OF AGRICULTURAL ADJUSTMENT.

SIXTH. TO FACILITATE PROMPT SERVICE, REQUEST ON THE WAR DEPARTMENT WILL BE SENT DIRECTLY TO THE CHIEF OF THE AIR CORPS, AND ON THE NAVY DEPARTMENT DIRECTLY TO THE CHIEF OF NAVAL OPERATIONS, THESE BEING DESIGNATED THE REPRESENTATIVES OF THE FURNISHING DEPARTMENTS. IF FOR ANY REASON IT IS IMPRACTICABLE FOR EITHER SERVICE TO COMPLY WITH ANY OTHER SERVICE FOR ACCOMPLISHING SAME.

SECTION 601, TITLE VI, OF THE ECONOMY ACT OF JUNE 30, 1932, 47 STAT. 417, PROVIDES AS FOLLOWS:

SECTION 7 OF THE ACT ENTITLED "AN ACT MAKING APPROPRIATIONS FOR FORTIFICATIONS AND OTHER WORKS OF DEFENSE, FOR THE ARMAMENT THEREOF, AND FOR THE PROCUREMENT OF HEAVY ORDNANCE FOR TRIAL AND SERVICE, FOR THE FISCAL YEAR ENDING JUNE 30, 1921, AND FOR OTHER PURPOSES," APPROVED MAY 21, 1920 (U.S.C., TITLE 31, SEC. 686), IS AMENDED TO READ AS FOLLOWS:

"SEC. 7. (A) ANY EXECUTIVE DEPARTMENT OR INDEPENDENT ESTABLISHMENT OF THE GOVERNMENT, OR ANY BUREAU OR OFFICE THEREOF, IF FUNDS ARE AVAILABLE THEREFOR AND IF IT IS DETERMINED BY THE HEAD OF SUCH EXECUTIVE DEPARTMENT, ESTABLISHMENT, BUREAU, OR OFFICE TO BE IN THE INTEREST OF THE GOVERNMENT SO TO DO, MAY PLACE ORDERS WITH ANY OTHER SUCH DEPARTMENT, ESTABLISHMENT, BUREAU, OR OFFICE FOR MATERIALS, SUPPLIES, EQUIPMENT, WORK, OR SERVICES, OF ANY KIND THAT SUCH REQUISITIONED FEDERAL AGENCY MAY BE IN A POSITION TO SUPPLY OR EQUIPPED TO RENDER, AND SHALL PAY PROMPTLY BY CHECK TO SUCH FEDERAL AGENCY AS MAY BE REQUISITIONED, UPON ITS WRITTEN REQUEST, EITHER IN ADVANCE OR UPON THE FURNISHING OR PERFORMANCE THEREOF, ALL OR PART OF THE ESTIMATED OR ACTUAL COST THEREOF AS DETERMINED BY SUCH DEPARTMENT, ESTABLISHMENT, BUREAU, OR OFFICE AS MAY BE REQUISITIONED; BUT PROPER ADJUSTMENTS ON THE BASIS OF THE ACTUAL COST OF THE MATERIALS, SUPPLIES, OR EQUIPMENT FURNISHED, OR WORK OR SERVICES PERFORMED, PAID FOR IN ADVANCE, SHALL BE MADE AS MAY BE AGREED UPON BY THE DEPARTMENTS, ESTABLISHMENTS, BUREAUS, OR OFFICES CONCERNED: PROVIDED, HOWEVER, THAT IF SUCH WORK OR SERVICES CAN BE AS CONVENIENTLY OR MORE CHEAPLY PERFORMED BY PRIVATE AGENCIES SUCH WORK SHALL BE LET BY COMPETITIVE BIDS TO SUCH PRIVATE AGENCIES. BILLS RENDERED, OR REQUESTS FOR ADVANCE PAYMENTS MADE, PURSUANT TO ANY SUCH ORDER, SHALL NOT BE SUBJECT TO AUDIT OR CERTIFICATION IN ADVANCE OF PAYMENT.'

IN DECISION OF NOVEMBER 11, 1932, 12 COMP. GEN. 442, 444, AFTER QUOTING THE ABOVE STATUTE, IT WAS HELD AS FOLLOWS:

THESE PROVISIONS WOULD APPEAR TO CONTEMPLATE THAT THE APPROPRIATIONS FOR THE DEPARTMENT OR OFFICE FOR WHICH THE WORK IS TO BE PERFORMED SHOULD BEAR THE TOTAL DIRECT COST THEREOF, INCLUDING PERSONAL SERVICES. NOTE PARTICULARLY THE SPECIFIC REFERENCE TO "SERVICES PERFORMED" AND THE AUTHORIZED ADJUSTMENT AS MAY BE AGREED TO BY THE DEPARTMENTS, ESTABLISHMENTS, BUREAUS, OR OFFICES CONCERNED ON THE BASIS OF THE ACTUAL COST OF THE SERVICES PERFORMED.

IN VIEW OF THESE STATUTORY PROVISIONS AND THE GENERAL PRACTICE OF APPROPRIATING LUMP SUMS FOR PERSONAL SERVICES UNDER THE VARIOUS BRANCHES OF THE GOVERNMENT, IT REASONABLY MAY BE CONCLUDED THAT THE RULE ABOVE STATED, IN FORCE PRIOR TO JULY 1, 1932, OF EXCLUDING SALARIES OF REGULAR EMPLOYEES WHICH WOULD HAVE BEEN PAID IN ANY EVENT, IS NOT TO BE REGARDED AS PRECLUDING IN MAKING ADJUSTMENTS ON ACCOUNT OF WORK PERFORMED BY ONE DEPARTMENT, ESTABLISHMENT, BUREAU, OR OFFICE, FOR ANOTHER UNDER THE PROVISIONS OF THE SAID SECTION 601, THE CONSIDERATION, AS A PART OF THE ACTUAL COST, OF THE SALARY OR COMPENSATION OF OFFICERS OR EMPLOYEES ENGAGED DIRECTLY ON THE WORK, INCLUDING THE AMOUNT TO BE DEDUCTED AND IMPOUNDED UNDER TITLE I OF THE ECONOMY ACT. SEE DECISION OF SEPTEMBER 13, 1932, A-43585, 12 COMP. GEN. 345.

THIS DECISION, RENDERED WITH PARTICULAR REFERENCE TO CIVILIAN PERSONNEL, DID NOT REQUIRE THAT THE SALARIES OF THE REGULAR PERSONNEL SHOULD BE INCLUDED AS AN ITEM OF COST OF SERVICES PERFORMED BY ONE DEPARTMENT OR OFFICE FOR ANOTHER. UNDER THE TERMS OF SECTION 601 (A) OF THE ECONOMY ACT, SUPRA, AS APPLIED BY SAID DECISION, IT IS FOR DETERMINATION AND AGREEMENT BY THE DEPARTMENTS OR OFFICES CONCERNED WHETHER THE ACTUAL COST OF INTERDEPARTMENTAL WORK SHALL INCLUDE ONLY ADDITIONAL EXPENSES DIRECTLY INCIDENT TO THE SERVICES PERFORMED UNDER THE RULE IN FORCE PRIOR TO THE DECISION OF NOVEMBER 11, 1932, SUPRA, OR WHETHER THERE SHOULD BE INCLUDED, ALSO, AS ITEMS OF COST THE SALARIES OF REGULAR PERSONNEL PERFORMING THE SERVICE AND OTHER REGULAR EXPENSES WHICH WOULD BE CHARGEABLE IN ANY EVENT TO THE APPROPRIATIONS OF THE PERFORMING DEPARTMENT. HOWEVER, SINCE THE PAY OF OFFICERS AND ENLISTED MEN OF THE ARMY AND NAVY IS INCIDENT TO THEIR STATUS, RATHER THAN TO THE PERFORMANCE OF WORK, IT WOULD APPEAR THAT THEIR PAY AND ALLOWANCES, OTHER THAN FOR TRAVEL, SHOULD NOT BE CONSIDERED IN COMPUTING THE COST OF RENDERING THE TRANSPORTATION SERVICE HERE INVOLVED.

REFERRING TO QUESTION (A), THE ITEMS OF COST WHICH MAY BE ALLOWED AND PAID TO THE NAVY DEPARTMENT PURSUANT TO AGREEMENT WOULD INCLUDE ANY NECESSARY DIRECT EXPENSES INCURRED IN MAKING THE FLIGHTS, SUCH AS GASOLINE, OIL, TRAVELING ALLOWANCES OF THE PILOTS, STORAGE, IF ANY, FEES FOR LANDING, IF ANY, ETC.

QUESTION (B) HAS BEEN ANSWERED GENERALLY ABOVE, THAT IS, THE MATTER IS SUBJECT TO AGREEMENT BETWEEN THE FARM CREDIT ADMINISTRATION AND THE NAVY DEPARTMENT. HOWEVER, THE FACT THAT THE NAVAL OFFICER PILOT WOULD RECEIVE CREDIT FOR THE FLIGHT, THEREBY OBVIATING THE NECESSITY FOR HIS PERFORMING ANOTHER FLIGHT AT THE EXPENSE OF THE NAVY TO MAKE UP HIS REQUIRED FLIGHT TIME, WOULD NOT NECESSARILY PRECLUDE CONSIDERING AS ITEMS OF COST ALL OF THE EXPENSES OF THE TRIP, OTHER THAN THE PAY AND ALLOWANCES OF THE NAVAL OFFICER PILOTING THE PLANE.

THE PRINCIPLE OF THE PROVISO TO SECTION 601 (A) OF THE ECONOMY ACT, "THAT IF SUCH WORK OR SERVICES CAN BE AS CONVENIENTLY OR MORE CHEAPLY PERFORMED BY PRIVATE AGENCIES SUCH WORK SHALL BE LET BY COMPETITIVE BIDS TO SUCH PRIVATE AGENCIES," SHOULD BE OBSERVED. THAT IS TO SAY, THE SHOWN THAT IT WILL COST LESS THAN COMMERCIAL TRANSPORTATION AND IMPOSES NO ADDITIONAL EXPENDITURE UNDER APPROPRIATIONS IN PROCURING AIRPLANES TO ESTABLISH AND RENDER THE SERVICE FOR OTHER GOVERNMENT AGENCIES. IN (QUOTING FROM THE SYLLABUS):

AIRPLANE TRANSPORTATION, IRRESPECTIVE OF THE COMPARATIVE COST OF RAIL TRANSPORTATION BUT NOT EXCEEDING THE COST OF LIKE SERVICE TO THE PUBLIC GENERALLY, MAY BE UTILIZED BY EMPLOYEES OF THE BUREAU OF MINES WHEN AN EMERGENCY SUCH AS A MINE DISASTER NECESSITATES THE IMMEDIATE PRESENCE OF THE EMPLOYEES WITH RESCUE APPARATUS.

IN VIEW OF THE LAST PART OF THE SECOND RECOMMENDATION CONTAINED IN THE LETTER OF OCTOBER 2 ,THAT REQUESTS FOR AIRCRAFT BE LIMITED TO FLIGHTS INVOLVING URGENT GOVERNMENTAL BUSINESS AND THAT THE REQUESTS SO STATE," THE COST OF THE AIR TRANSPORTATION SERVICE RENDERED BY THE NAVY DEPARTMENT SHOULD BE COMPARED WITH THE COST OF SUCH TRANSPORTATION BY MEANS OF COMMERCIAL AIR LINES IN DETERMINING WHICH IS THE CHEAPER WITHIN THE MEANING OF THE PROVISO TO SECTION 601 (A) OF THE ECONOMY ACT. QUESTION (C) IS ANSWERED ACCORDINGLY.