A-70139, JUNE 18, 1936, 15 COMP. GEN. 1111

A-70139: Jun 18, 1936

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

SAID CHARGE BASIS IS UNAUTHORIZED WHERE THE TRANSPORTATION CAN BE PERFORMED ON A SCHEDULED COMMERCIAL ROUTE NOTWITHSTANDING THE GOVERNMENT BUSINESS BE URGENT. AS FOLLOWS: RECEIPT IS ACKNOWLEDGED OF YOUR LETTER OF MARCH 26. WHILE IT IS TRUE THAT REFERENCE WAS MADE TO THE AUDIT ACTION OF YOUR OFFICE IN THE CASE ARISING BETWEEN TWO OTHER DEPARTMENTS (NAVY AND TREASURY). THIS ACTION WAS CITED BY THE WAR DEPARTMENT NOT FOR THE PURPOSE OF SECURING A REVIEW PER SE OF THAT AUDIT ACTION. FROM THAT APPLIED IN THAT AUDIT ACTION IN CASES WHICH MIGHT ARISE IN THE FUTURE WHERE ARMY AIRPLANES WERE USED. THE ADVICE OF YOUR OFFICE WAS DESIRED ON WHAT WAS CONCEIVED TO BE A FISCAL QUESTION INVOLVING APPROPRIATED FUNDS AND ARISING IN THE ADMINISTRATION OF THE AFFAIRS OF THE WAR DEPARTMENT.

A-70139, JUNE 18, 1936, 15 COMP. GEN. 1111

DEPARTMENTS AND ESTABLISHMENTS - SERVICES BETWEEN - AIRPLANE TRANSPORTATION IN DETERMINING THE COST OF TRANSPORTATION SERVICE AUTHORIZED TO BE FURNISHED DESIGNATED GOVERNMENT OFFICIALS BY THE WAR AND NAVY DEPARTMENTS UNDER REGULATIONS APPROVED BY THE PRESIDENT OCTOBER 18, 1933, THE CHARGE TO THE DEPARTMENT USING THE ARMY OR NAVY PLANES MAY BE ON THE BASIS OF THE ACTUAL COST THEREOF, INCLUDING SUCH ITEMS AS LISTED IN 13 COMP. GEN. 150, NOT IN EXCESS OF THE COST OF CHARTERING A COMMERCIAL PLANE, WHERE TRAVEL INVOLVES A DESTINATION NOT A REGULAR STOP ON A SCHEDULED COMMERCIAL AIR ROUTE (13 COMP. GEN. 150, MODIFIED), BUT SAID CHARGE BASIS IS UNAUTHORIZED WHERE THE TRANSPORTATION CAN BE PERFORMED ON A SCHEDULED COMMERCIAL ROUTE NOTWITHSTANDING THE GOVERNMENT BUSINESS BE URGENT, THE COMPARISON OF COST IN SUCH CASE TO BE ON THE BASIS OF RATES CHARGED BY COMMERCIAL AIR LINES.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF WAR, JUNE 18, 1936:

THERE HAS BEEN RECEIVED YOUR LETTER OF MAY 15, 1936, AS FOLLOWS:

RECEIPT IS ACKNOWLEDGED OF YOUR LETTER OF MARCH 26, 1936, IN WHICH YOU REFRAIN FROM RENDERING A DECISION ON THE QUESTIONS PROPOUNDED IN MY LETTER OF JANUARY 16, 1936, FOR THE REASON THAT, AS STATED BY YOU, SUCH LETTER CONSTITUTES A REQUEST BY THE WAR DEPARTMENT FOR REVIEW OF AN AUDIT ACTION BY YOUR OFFICE CONCERNING AN EXPENDITURE OF ANOTHER DEPARTMENT, WHICH FACT YOU STATE GIVES THE WAR DEPARTMENT NO RIGHT TO SEEK, AND YOUR OFFICE NO RIGHT TO RENDER, A DECISION IN THE PREMISES.

THIS DEPARTMENT CANNOT HELP BUT FEEL THAT SOME MISUNDERSTANDING EXISTS ON YOUR PART AS TO THE NATURE OF THE REQUEST CONTAINED IN ITS LETTER OF JANUARY 16, 1936. WHILE IT IS TRUE THAT REFERENCE WAS MADE TO THE AUDIT ACTION OF YOUR OFFICE IN THE CASE ARISING BETWEEN TWO OTHER DEPARTMENTS (NAVY AND TREASURY), THIS ACTION WAS CITED BY THE WAR DEPARTMENT NOT FOR THE PURPOSE OF SECURING A REVIEW PER SE OF THAT AUDIT ACTION, BUT AS INDUCEMENT, SO TO SPEAK, TO A FULL DISCLOSURE OF THE FISCAL PROBLEM CONFRONTING THE WAR DEPARTMENT GROWING OUT OF THE USE OF ITS AIRPLANES BY OFFICIALS OF OTHER DEPARTMENTS UNDER THE PRESIDENT'S REGULATIONS OF OCTOBER 18, 1933, AND WITH A VIEW TO SEEKING A CHANGED RULE, BECAUSE OF CONSIDERATIONS SET FORTH, FROM THAT APPLIED IN THAT AUDIT ACTION IN CASES WHICH MIGHT ARISE IN THE FUTURE WHERE ARMY AIRPLANES WERE USED. IN OTHER WORDS, THE ADVICE OF YOUR OFFICE WAS DESIRED ON WHAT WAS CONCEIVED TO BE A FISCAL QUESTION INVOLVING APPROPRIATED FUNDS AND ARISING IN THE ADMINISTRATION OF THE AFFAIRS OF THE WAR DEPARTMENT, DECISION ON WHICH, AS STATED IN THE LETTER FROM THIS DEPARTMENT OF JANUARY 16, 1936, WAS REQUIRED IN ORDER THAT THE WAR DEPARTMENT COULD PLAN ITS EXPENDITURE PROGRAM.

WHILE IT IS APPRECIATED THAT SECTION 8 OF THE ACT OF JULY 31, 1894, 28 STAT. 208, AUTHORIZES THE HEAD OF A DEPARTMENT TO SEEK AN ADVANCE DECISION IN CASES INVOLVING "A PAYMENT TO BE MADE BY THEM OR UNDER THEM," AND THAT PAYMENTS ON WHICH YOUR DECISION WAS DESIRED WOULD BE MADE BY ANOTHER DEPARTMENT USING ARMY AIRPLANES UNDER THE PRESIDENT'S REGULATIONS, IT WAS NEVERTHELESS THOUGHT THAT THE PRINCIPLE UNDERLYING THIS STATUTE IN QUESTION WAS SO FULLY APPLICABLE TO THE SITUATION CONFRONTING THIS DEPARTMENT AS TO MERIT YOUR ADVICE IN THE PREMISES IN ADVANCE OF THE RENDITION OF THE SERVICES IN QUESTION.

IN VIEW OF THE ABOVE, IT IS REQUESTED THAT YOU RECONSIDER THE VIEW TAKEN IN YOUR LETTER UNDER ACKNOWLEDGMENT AND ADVISE THIS DEPARTMENT ON THE QUESTION PRESENTED BY ITS LETTER OF JANUARY 16, 1936.

WHILE THE LETTER OF JANUARY 16, 1936, ON THE CASE THEREIN REFERRED TO, PRESENTED NO PROPER BASIS FOR A DECISION TO YOU, YOUR PRESENT LETTER, CONSIDERED IN CONJUNCTION WITH THE SAID PRIOR LETTER, CONSTITUTES A SUFFICIENT BASIS FOR A DECISION BY THIS OFFICE, AND WILL BE CONSIDERED ACCORDINGLY.

YOUR LETTER OF JANUARY 16, 1936, WAS AS FOLLOWS:

REFERENCE IS MADE TO REGULATIONS APPROVED BY THE PRESIDENT ON OCTOBER 18, 1933, SET FORTH IN 13 C.G. 150, AUTHORIZING CERTAIN DESIGNATED OFFICIALS OF THE GOVERNMENT TO USE AIRPLANES CONTROLLED BY THE ARMY AND NAVY DEPARTMENTS FOR FLIGHTS INVOLVING GOVERNMENTAL BUSINESS. THESE REGULATIONS PROVIDED IN PART "* * * THAT REQUESTS FOR AIRCRAFT BE LIMITED TO FLIGHTS INVOLVING URGENT GOVERNMENTAL BUSINESS AND THAT THE REQUESTS SO STATE" AND THAT "ALL EXPENSES INCIDENT TO FLIGHTS BE CHARGED TO THE DEPARTMENT OR AGENCY USING THE AIRCRAFT * * *.' IN ACCORDANCE WITH THESE REGULATIONS CHARGES HAVE BEEN MADE BY THE WAR AND NAVY DEPARTMENTS AGAINST THE DEPARTMENTS OR AGENCIES WHOSE PERSONNEL HAS FROM TIME TO TIME UTILIZED MILITARY AND NAVAL PLANES IN MAKING FLIGHTS IN CONNECTION WITH SUCH URGENT GOVERNMENTAL BUSINESS.

IT HAS NOW COME TO THE ATTENTION OF THE WAR DEPARTMENT, HOWEVER, THAT A BILL IN THE AMOUNT OF $146.84 (THE ESTIMATED COST OF THE JOURNEY BY NAVY PLANE) PRESENTED BY THE NAVY DEPARTMENT TO THE TREASURY DEPARTMENT FOR THE EXPENSES OF AIR TRANSPORTATION FURNISHED THE SECRETARY OF THE TREASURY FROM ANACOSTIA, D.C., TO NEW YORK CITY ON AUGUST 2, 1934, WAS SUBMITTED TO THE GENERAL ACCOUNTING OFFICE FOR PREAUDIT AND WAS ALLOWED IN THE AMOUNT OF $20.04 ONLY, BEING THE ACTUAL COST OF TRANSPORTATION BY SCHEDULED TRIP, ON COMMERCIAL AIR LINES BETWEEN THE POINTS IN QUESTION, CITATION BEING MADE IN THIS CONNECTION OF YOUR DECISION DATED NOVEMBER 24, 1933, 13 C. G. 150, SUPRA. IN THIS DECISION OF NOVEMBER 24, 1933, YOU REFER TO THE PROVISION IN SECTION 601 OF THE ACT OF JUNE 30, 1932, 47 STAT. 417, RELATIVE TO SERVICES BETWEEN DEPARTMENTS AND ESTABLISHMENTS, WHICH READS: "THAT IF SUCH WORK OR SERVICES CAN BE AS CONVENIENTLY OR MORE CHEAPLY PERFORMED BY PRIVATE AGENCIES SAID WORK SHALL BE LET BY COMPETITIVE BIDS TO SUCH PRIVATE AGENCIES," AND HOLD THAT THE USE OF GOVERNMENT AIRPLANE TRANSPORTATION IS NOT AUTHORIZED UNLESS IT CAN BE 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. THIS DECISION FURTHER HOLDS THAT THE COST OF GOVERNMENT AIR TRANSPORTATION SERVICE SHOULD BE COMPARED WITH THE COST OF SUCH TRANSPORTATION BY MEANS OF COMMERCIAL AIR LINES IN DETERMINING WHICH IS THE CHEAPER.

IN VIEW OF THE FACT THAT AIR TRAVEL IN PLANES UNDER THE JURISDICTION OF THIS DEPARTMENT ENTAILS AN EXPENSE GREATER THAN THAT CUSTOMARILY CHARGED PERSONS TRAVELING ON COMMERCIAL AIR CARRIERS HAVING REGULAR SCHEDULED SERVICE, WHICH UNDER THE RULE ANNOUNCED IN 13 C.G. 150, IF NOT MODIFIED, WOULD SEEM TO RENDER THE USE OF ARMY PLANES IMPOSSIBLE UNDER THE PRESIDENT'S REGULATION, IT IS DESIRED TO BRING TO YOUR ATTENTION CERTAIN CONSIDERATIONS IN CONNECTION WITH TRAVEL UNDER THE REGULATIONS OF THE PRESIDENT ABOVE REFERRED TO WITH A VIEW TO SEEKING AT YOUR HANDS A MODIFICATION OF THE RULE OF THAT DECISION, AND AS APPLIED IN THE NAVY PREAUDIT ACTION ABOVE REFERRED TO.

THE RECORDS OF THE WAR DEPARTMENT ON TRIPS PREVIOUSLY MADE UNDER THE PRESIDENT'S REGULATIONS SHOW THAT IN A NUMBER OF CASES THE TYPE OF SERVICE REQUESTED INVOLVED TRIPS BY AIR WHICH WERE BETWEEN POINTS EITHER NOT ON COMMERCIAL AIR ROUTES OR NOT AVAILABLE ON SUCH ROUTES WITHOUT TRANSFER OR THE PARTIAL USE OF OTHER MEANS OF TRANSPORTATION OR WHICH REQUIRED ONE OR MORE STOPS NOT PROVIDED FOR ON COMMERCIAL ROUTES OR WHICH DID NOT PERMIT OF THE DELAY INCIDENT TO THE REGULAR COMMERCIAL SERVICE. IN SUCH CASES, IT IS BELIEVED THAT THE COST OF THE SERVICE RENDERED BY ARMY PLANES MAY NOT PROPERLY BE COMPARED WITH THE COST OF ORDINARY COMMERCIAL SCHEDULED SERVICE FOR THE PURPOSE OF ASCERTAINING WHETHER IT "CAN BE AS CONVENIENTLY OR MORE CHEAPLY PERFORMED BY PRIVATE AGENCIES.' A MORE ACCURATE BASIS OF COMPARISON AS TO COST AND OFFICIAL CONVENIENCE WOULD BE THAT INVOLVED IN CHARTERING COMMERCIAL AIRPLANES TO FURNISH THE SAME SERVICE AS THAT CONTEMPLATED TO BE FURNISHED BY GOVERNMENT AIRPLANES UNDER THE REGULATIONS APPROVED BY THE PRESIDENT.

IT IS, THEREFORE, SUGGESTED THAT WHERE THE URGENCY OF GOVERNMENT BUSINESS WILL NOT PERMIT OF THE DELAY INCIDENT TO THE USE OF COMMERCIAL AIR TRANSPORTS, OR WHERE THE SERVICE SO RENDERED, INCLUDING INTERMEDIATE STOPS, COULD NOT BE FURNISHED BY A COMMERCIAL COMPANY ON SCHEDULED ROUTES, THE ACTUAL EXPENSES, INCLUDING NECESSARY REPAIRS, DEPRECIATION, ETC., INCURRED, AS DETERMINED BY THE AGENCY RENDERING THE SERVICE, ARE CHARGEABLE IN THE INTERESTS OF THE PUBLIC SERVICE TO THE DEPARTMENT OR AGENCY USING THE AIRCRAFT WITHOUT REGARD TO THE COST OF THE TRANSPORTATION BY MEANS OF SUCH COMMERCIAL AIR LINES.

IN CASE THIS VIEW IS ADOPTED BY YOU INFORMATION IS REQUESTED AS TO THE FORM AND CONTENT OF THE CERTIFICATE WHICH THE REQUESTING AGENCY SHOULD BE CALLED UPON TO FURNISH WITH ITS REQUEST FOR TRANSPORTATION IN A GOVERNMENT OWNED AIRPLANE.

HAVING IN MIND THE ABOVE CONSIDERATIONS AND IN ORDER THAT THIS DEPARTMENT MAY PLAN ITS EXPENDITURE PROGRAM OF APPROPRIATED FUNDS WITH AN EXACT KNOWLEDGE OF WHAT REIMBURSEMENT MAY BE LEGALLY HAD FROM THOSE DEPARTMENTS TO WHICH SUCH PLANE SERVICE IS FURNISHED UNDER THE PRESIDENT'S REGULATIONS, YOUR PROMPT DECISION IN THE PREMISES IS REQUESTED.

IN DECISION OF NOVEMBER 24, 1933, 13 COMP. GEN. 150, IT WAS HELD AS FOLLOWS (QUOTING FROM THE SYLLABUS):

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 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 WILL 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.

REFERRING TO THE LAST PARAGRAPH JUST QUOTED, YOU SUGGEST THAT (1) WHERE THE URGENCY OF GOVERNMENT BUSINESS WILL NOT PERMIT OF THE DELAY INCIDENT TO THE USE OF COMMERCIAL AIR TRANSPORTS, OR (2) THE SERVICE COULD NOT BE RENDERED BY A COMMERCIAL COMPANY ON SCHEDULED ROUTES, THE ACTUAL COST OF THE SERVICE BE DETERMINED AND CHARGED TO THE DEPARTMENT USING THE PLANES WITHOUT REGARD TO THE COST OF TRANSPORTATION BY MEANS OF SUCH COMMERCIAL AIR LINES.

AS TO (1), IT WOULD SEEM THAT THE GOVERNMENT'S INTEREST SHOULD BE SO PARAMOUNT IN THE CONDUCT OF PUBLIC BUSINESS THAT REASONABLE ADMINISTRATIVE ACTION WOULD AVOID THE NECESSITY OF CHARTERING A PRIVATE PLANE (14 COMP. GEN. 920; 15 ID. 395). HENCE, WHERE THE TRANSPORTATION COULD BE PERFORMED ON A SCHEDULED COMMERCIAL ROUTE, THERE MUST BE A COMPARISON UNDER THE PROVISO TO SECTION 601 OF THE ECONOMY ACT OF JUNE 30, 1932 (47 STAT. 417), WITH THE COST OF COMMERCIAL AIR TRANSPORTATION TO DETERMINE THE AVAILABILITY OF THE ARMY OR NAVY PLANES.

REFERRING TO (2), WHERE THE TRAVEL IS REQUIRED TO BE PERFORMED TO A DESTINATION WHICH IS NOT A REGULAR STOP ON A SCHEDULED COMMERCIAL AIR ROUTE, THE COMPARISON OF COST UNDER THE PROVISO TO SECTION 601 OF THE ECONOMY ACT, SUPRA MAY BE THE COST OF CHARTERING A COMMERCIAL AIRPLANE TO FURNISH THE SAME SERVICE AND REIMBURSEMENT FOR THE USE THEREOF SHOULD BE THE ACTUAL COST, INCLUDING SUCH ITEMS AS WERE LISTED IN SAID DECISION OF NOVEMBER 24, 1933, AS FOLLOWS:

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.

SEE ALSO THE FOURTH SENTENCE OF PARAGRAPH 8 OF THE STANDARDIZED TRAVEL REGULATIONS, AS AMENDED DECEMBER 10, 1935. COMPARE ALSO THE ACT OF MAY 9, 1935 (49 STAT. 202).