A-61054, MAY 10, 1935, 14 COMP. GEN. 822

A-61054: May 10, 1935

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AS RECEIVERS OF NATIONAL BANKS ARE OFFICERS OF THE UNITED STATES WHOSE SALARIES ARE PAID OUT OF FUNDS COLLECTED FROM BANKS WHICH BECOME PUBLIC MONEYS. THE RECEIVERS ARE NOT AUTHORIZED TO HOLD ALSO AN OFFICE OR POSITION UNDER THE FEDERAL HOUSING ADMINISTRATION. AS FOLLOWS: THERE IS SUBMITTED FOR YOUR CONSIDERATION AND DECISION THE QUESTION OF WHETHER OR NOT RECEIPT OF DUAL COMPENSATION IS ILLEGAL UNDER THE PROVISIONS OF THE ACT OF JULY 31. WHEN ONE SALARY IS PAID BY THE FEDERAL HOUSING ADMINISTRATION AND THE OTHER IS DERIVED FROM ASSETS OF INSOLVENT NATIONAL BANKS FOR SERVICES PERFORMED AS THE RECEIVER THEREOF. WHEN IT WAS LEARNED THAT HE HAD RETAINED HIS POSITION UNDER THE COMPTROLLER OF THE CURRENCY AS RECEIVER OF THE FIRST NATIONAL BANK OF FLORENCE.

A-61054, MAY 10, 1935, 14 COMP. GEN. 822

COMPENSATION, DOUBLE - FEDERAL HOUSING ADMINISTRATION DUAL COMPENSATION STATUTES DISQUALIFY FOR FURTHER APPOINTMENT UNDER THE NATIONAL HOUSING ACT THOSE FEDERAL OFFICERS AND EMPLOYEES ALREADY RECEIVING A RATE OF COMPENSATION UNDER ANY OTHER STATUTE, INCLUDING THOSE APPLICABLE TO THE HOME OWNERS' LOAN CORPORATION, AND THE NATIONAL RECOVERY ADMINISTRATION, WHICH, TOGETHER WITH THE RATE PROPOSED TO BE PAID BY THE FEDERAL HOUSING ADMINISTRATION WOULD EXCEED THE MAXIMUM JOINT SALARY RATE PRESCRIBED BY THE APPLICABLE DUAL COMPENSATION STATUTE TO BE RECEIVED IN MORE THAN ONE FEDERAL OFFICE OR POSITION. AS RECEIVERS OF NATIONAL BANKS ARE OFFICERS OF THE UNITED STATES WHOSE SALARIES ARE PAID OUT OF FUNDS COLLECTED FROM BANKS WHICH BECOME PUBLIC MONEYS, THE RECEIVERS ARE NOT AUTHORIZED TO HOLD ALSO AN OFFICE OR POSITION UNDER THE FEDERAL HOUSING ADMINISTRATION, IN CONTRAVENTION OF DUAL COMPENSATION STATUTES.

COMPTROLLER GENERAL MCCARL TO THE ADMINISTRATOR, FEDERAL HOUSING ADMINISTRATION, MAY 10, 1935:

THERE HAS BEEN RECEIVED YOUR LETTER OF MARCH 18, 1935, AS FOLLOWS:

THERE IS SUBMITTED FOR YOUR CONSIDERATION AND DECISION THE QUESTION OF WHETHER OR NOT RECEIPT OF DUAL COMPENSATION IS ILLEGAL UNDER THE PROVISIONS OF THE ACT OF JULY 31, 1934, SECTION 2 (28 STAT.L. 205) OR THE ACT OF MAY 10, 1916 (39 STAT. 120), AS AMENDED BY THE ACT OF AUGUST 26, 1916 (39 STAT. 582), WHEN ONE SALARY IS PAID BY THE FEDERAL HOUSING ADMINISTRATION AND THE OTHER IS DERIVED FROM ASSETS OF INSOLVENT NATIONAL BANKS FOR SERVICES PERFORMED AS THE RECEIVER THEREOF.

MR. CARL E. HULL SERVED AS JUNIOR APPRAISER IN THE FEDERAL HOUSING ADMINISTRATION AT $2,600 PER ANNUM FROM NOVEMBER 12 TO 30, 1934, AND AS CHIEF MORTGAGE EXAMINER AT $3,200 PER ANNUM FROM DECEMBER 1 TO 28, 1934. WHEN IT WAS LEARNED THAT HE HAD RETAINED HIS POSITION UNDER THE COMPTROLLER OF THE CURRENCY AS RECEIVER OF THE FIRST NATIONAL BANK OF FLORENCE, ARIZONA, AND THE FIRST NATIONAL BANK OF MESA, ARIZONA, AND HAD CONTINUED TO DRAW SALARY FOR THE SAME PERIOD FROM THESE INSOLVENT NATIONAL BANKS AT THE RATE OF $3,600 PER ANNUM, HIS SERVICES AS CHIEF MORTGAGE EXAMINER WERE TERMINATED AND HE WAS REQUESTED TO RETURN THE TOTAL AMOUNT OF SALARY PAYMENTS MADE TO HIM BY THIS ADMINISTRATION FROM NOVEMBER 12 TO DECEMBER 15, 1934, IN THE AMOUNT OF $257.01.

MR. HULL HAS REQUESTED A REVIEW OF HIS CASE AND CLAIMS THAT, INASMUCH AS HIS REMUNERATION AS RECEIVER IS NOT PAID BY THE FEDERAL GOVERNMENT BUT FROM FUNDS OF THE TRUSTS WHICH HE ADMINISTERS, HE IS ENTITLED TO RETAIN BOTH SALARIES. AS TO THE LEGAL STATUS OF RECEIVERS AND EMPLOYEES OF THE INSOLVENT NATIONAL BANK DIVISION, OFFICE OF THE COMPTROLLER OF THE CURRENCY, TREASURY DEPARTMENT, WHO ARE PAID FROM FUNDS OBTAINED FROM NATIONAL BANKS IN RECEIVERSHIP AND NOT FROM FEDERAL APPROPRIATIONS, THE ATTORNEY GENERAL IN AN OPINION DATED FEBRUARY 16, 1933, HELD THAT EMPLOYEES WHO ARE APPOINTED BY A FEDERAL OFFICER AND CHARGED WITH THE PERFORMANCE OF DUTIES UNDER A FEDERAL STATUTE MUST BE REGARDED AS EMPLOYEES OF THE UNITED STATES AND THE FACT THAT THESE EMPLOYEES ARE NOT PAID FROM FUNDS APPROPRIATED BY CONGRESS DOES NOT AFFECT THEIR STATUS AS EMPLOYEES IN THE EXECUTIVE CIVIL SERVICE OF THE UNITED STATES.

IN VIEW OF THE BROAD AUTHORITY VESTED IN THE ADMINISTRATOR BY SECTION 1 OF THE NATIONAL HOUSING ACT OF JUNE 27, 1934 (48 STAT. 1246) TO APPOINT SUCH OFFICERS AND EMPLOYEES AS HE MAY FIND NECESSARY TO CARRY OUT THE PROVISIONS OF THE ACT WITHOUT REGARD TO THE PROVISIONS OF OTHER LAWS APPLICABLE TO THE EMPLOYMENT OR COMPENSATION OF OFFICERS AND EMPLOYEES OF THE UNITED STATES, AND OF YOUR DECISION OF JANUARY 9, 1935, A-58815, THIS ADMINISTRATION IS UNCERTAIN AS TO WHETHER OR NOT THE ACCEPTANCE BY MR. HULL OF SALARY AS AN EMPLOYEE OF THE FEDERAL HOUSING ADMINISTRATION AND AS RECEIVER OF THE FIRST NATIONAL BANKS OF FLORENCE AND MESA, ARIZONA, FOR THE SAME PERIOD CONSTITUTES THE RECEIPT OF ILLEGAL DUAL COMPENSATION.

IN THIS CONNECTION ATTENTION IS INVITED TO FEDERAL HOUSING ADMINISTRATION GENERAL ORDER NO. 4, REVISED OCTOBER 20, 1934, COPY ATTACHED, IN WHICH IT IS ORDERED THAT IN THE INCURRING OF OBLIGATIONS AND THE PAYMENT OF EXPENDITURES BY THIS ADMINISTRATION THE ESTABLISHED GOVERNMENT PROCEDURE BE FOLLOWED, SO FAR AS PRACTICABLE, IN EACH INSTANCE.

IN ADDITION TO THE ABOVE-CITED CASE, THIS ADMINISTRATION HAS FOR CONSIDERATION SEVERAL INSTANCES OF APPARENT DUAL COMPENSATION WHERE OTHER FEDERAL AGENCIES ARE CONCERNED. IT IS, THEREFORE, REQUESTED THAT YOUR DECISION COVER THE LEGALITY OF DUAL SALARY PAYMENTS WHEN MADE BY THE FEDERAL HOUSING ADMINISTRATION AND THE HOME OWNERS' LOAN CORPORATION AND/OR THE NATIONAL RECOVERY ADMINISTRATION.

SECTION 6 OF THE ACT OF MAY 10, 1916 (39 STAT. 120), AS AMENDED AUGUST 29, 1916 (39 STAT. 582), PROVIDES:

SECTION 6. THAT UNLESS OTHERWISE SPECIALLY AUTHORIZED BY LAW, NO MONEY APPROPRIATED BY THIS OR ANY OTHER ACT SHALL BE AVAILABLE FOR PAYMENT TO ANY PERSON RECEIVING MORE THAN ONE SALARY WHEN THE COMBINED AMOUNT OF SAID SALARIES EXCEEDS THE SUM OF $2,000 PER ANNUM, BUT THIS SHALL NOT APPLY TO RETIRED OFFICERS OR ENLISTED MEN OF THE ARMY, NAVY, MARINE CORPS, OR COAST GUARD, OR TO OFFICERS AND ENLISTED MEN OF THE ORGANIZED MILITIA AND NAVAL MILITIA IN THE SEVERAL STATES, TERRITORIES, AND THE DISTRICT OF COLUMBIA: PROVIDED, THAT NO SUCH RETIRED OFFICER, OFFICER, OR ENLISTED MAN SHALL BE DENIED OR DEPRIVED OF ANY OF HIS PAY, SALARY, OR COMPENSATION AS SUCH, OR OF ANY OTHER SALARY OR COMPENSATION FOR SERVICES HERETOFORE RENDERED, BY REASON OF ANY DECISION OR CONSTRUCTION OF SAID SECTION SIX.

SECTION 2 OF THE ACT OF JULY 31, 1894 (28 STAT. 205), PROVIDES:

* * * NO PERSON WHO HOLDS AN OFFICE THE SALARY OR ANNUAL COMPENSATION ATTACHED TO WHICH AMOUNTS TO THE SUM OF TWO THOUSAND FIVE HUNDRED DOLLARS SHALL BE APPOINTED TO OR HOLD ANY OTHER OFFICE TO WHICH COMPENSATION IS ATTACHED UNLESS SPECIALLY HERETOFORE OR HEREAFTER SPECIALLY AUTHORIZED THERETO BY LAW; BUT THIS SHALL NOT APPLY TO RETIRED OFFICERS OF THE ARMY OR NAVY WHENEVER THEY MAY BE ELECTED TO PUBLIC OFFICE OR WHENEVER THE PRESIDENT SHALL APPOINT THEM TO OFFICE BY AND WITH THE ADVICE AND CONSENT OF THE SENATE.

IN THE DECISION OF JANUARY 9, 1935, (14 COMP. GEN. 527), CITED IN YOUR LETTER, IT WAS STATED AS FOLLOWS:

SECTION 1 OF THE NATIONAL HOUSING ACT OF JUNE 27, 1934, (48 STAT. 1246), QUOTED IN YOUR LETTER, SPECIFICALLY AUTHORIZES THE APPOINTMENT OF SUCH OFFICERS AND EMPLOYEES AS THE ADMINISTRATOR MAY FIND NECESSARY TO CARRY OUT THE PROVISIONS OF THE ACT "WITHOUT REGARD TO THE PROVISIONS OF OTHER LAW APPLICABLE TO THE EMPLOYMENT OR COMPENSATION OF OFFICERS AND EMPLOYEES OF THE UNITED STATES.' ALSO, SAID SECTION AUTHORIZES THE ADMINISTRATOR TO MAKE SUCH EXPENDITURES AS ARE NECESSARY TO CARRY OUT THE PROVISIONS OF TITLES I, II, AND III OF THE ACT "WITHOUT REGARD TO ANY OTHER PROVISIONS OF LAW GOVERNING THE EXPENDITURE OF PUBLIC FUNDS.'

WHILE THE AUTHORITY THUS VESTED IN THE ADMINISTRATOR IS BROADER THAN THAT USUALLY GRANTED, EVEN BY EMERGENCY LEGISLATION, TO EMPLOY AND PAY PERSONNEL WITHOUT REGARD FOR THE PROVISIONS OF THE CIVIL-SERVICE LAWS AND THE CLASSIFICATION ACT, THERE APPEARS NOTHING SUGGESTING A LEGISLATIVE PURPOSE TO AUTHORIZE DISREGARD OF A STATUTE SPECIFICALLY DISQUALIFYING A PARTICULAR PERSON OR CLASS OF PERSONS FOR "APPOINTMENT TO ANY APPOINTIVE OFFICE, POSITION, OR EMPLOYMENT UNDER THE UNITED STATES OR THE DISTRICT OF COLUMBIA.' ONE OF THE PURPOSES OF SECTION 204 OF THE ECONOMY ACT OF JUNE 30, 1932, WAS TO SPREAD EMPLOYMENT BY PROHIBITING REEMPLOYMENT OF THOSE RETIRED WITH ANNUITY BECAUSE OF AGE. IT DOES NOT PRESCRIBE QUALIFICATIONS FOR APPOINTMENT AS DO THE CIVIL SERVICE LAWS AND REGULATIONS--- IT DISQUALIFIES FOR APPOINTMENT--- AND THE DISQUALIFICATION IS NOT OVERCOME BY THE PROVISIONS OF THE ACT CREATING THE FEDERAL HOUSING ADMINISTRATION, AN AGENCY OF THE UNITED STATES.

ALSO THE DUAL COMPENSATION STATUTES DISQUALIFY FOR FURTHER APPOINTMENT UNDER THE NATIONAL HOUSING ACT THOSE FEDERAL OFFICERS AND EMPLOYEES ALREADY RECEIVING A RATE OF COMPENSATION UNDER ANY OTHER STATUTE, INCLUDING THOSE APPLICABLE TO THE HOME OWNERS' LOAN CORPORATION AND THE NATIONAL RECOVERY ADMINISTRATION, WHICH, TOGETHER WITH THE RATE PROPOSED TO BE PAID BY THE FEDERAL HOUSING ADMINISTRATION UNDER AUTHORITY OF THE NATIONAL HOUSING ACT, WOULD EXCEED THE MAXIMUM JOINT SALARY RATE PRESCRIBED BY THE APPLICABLE DUAL COMPENSATION STATUTE TO BE RECEIVED IN MORE THAN ONE FEDERAL OFFICE OR POSITION. AS TO THE NATIONAL RECOVERY ACT, SEE 13 COMP. GEN. 54; ID. 60. EVEN IF THE BROAD TERMS OF THE NATIONAL HOUSING ACT MIGHT BE INTERPRETED TO AUTHORIZE DISREGARD OF THE DUAL COMPENSATION STATUTES, APPOINTMENT OF FEDERAL OFFICERS AND EMPLOYEES TO ANOTHER OFFICE OR POSITION UNDER THE FEDERAL HOUSING ACT WOULD RENDER UNLAWFUL THE PAYMENT OF APPROPRIATED FUNDS FOR COMPENSATION UNDER THE OTHER FEDERAL STATUTES NOT CONTAINING SUCH BROAD LANGUAGE. FURTHERMORE, SUCH DUAL EMPLOYMENT CLEARLY DEFEATS ONE OF THE PRIME PURPOSES OF RECENT LEGISLATION AUTHORIZING EMPLOYMENT OF PERSONNEL,INCLUDING THE NATIONAL HOUSING ACT, VIZ., THE SPREAD OF EMPLOYMENT, AND FOR THAT REASON ALONE MAY NOT BE APPROVED.

RECEIVERS OF NATIONAL BANKS ARE OFFICERS OF THE UNITED STATES AND THE MONEYS COLLECTED FROM BANKS FROM WHICH THE RECEIVERS' SALARIES ARE PAID, ARE PUBLIC MONEYS. BRANCH V. UNITED STATES, 100 U.S. 673; UNITED STATES V. WEITZEL, 246 U.S. 533; PRICE V. ABBOTT, 17 FED. 506; PORT NEWARK NATIONAL BANK OF NEWARK V. WALDRON, 46 FED./2D), 296; 22 COMP. DEC. 477; 3 COMP. GEN. 43; I2 ID. 580. AS THERE IS NO PROVISION OF LAW EXEMPTING RECEIVERS OF NATIONAL BANKS FROM THE LIMITATIONS OF THE DUAL COMPENSATION STATUTES, SUPRA, THE ADMINISTRATIVE ACTION IS NOT FOR QUESTIONING IN DISCONTINUING THE SERVICES OF CARL E. HULL AND IN REQUESTING HIM TO REFUND THE TOTAL AMOUNT OF COMPENSATION RECEIVED FROM THE FEDERAL HOUSING ADMINISTRATION. YOU STATE THAT HE SERVED WITH THE FEDERAL HOUSING ADMINISTRATION FROM NOVEMBER 12 TO DECEMBER 28, 1934, BUT REFUND OF COMPENSATION HAS BEEN REQUESTED ONLY FOR THE PERIOD NOVEMBER 12 TO DECEMBER 15. UNLESS THERE ARE FACTS NOT DISCLOSED REQUIRING CONTRARY ACTION, REFUND OF COMPENSATION SHOULD BE REQUESTED ALSO FOR THE PERIOD DECEMBER 16 TO 28, 1934.