A-88302, AUGUST 14, 1937, 17 COMP. GEN. 139

A-88302: Aug 14, 1937

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INSURANCE - GOVERNMENT VALUABLES - TRANSPORTATION RATES INCLUDING PREMIUMS - GOVERNMENT LOSSES IN SHIPMENT ACT WHERE CHARGES FOR TRANSPORTATION OF VALUABLES ARE REGULARLY FIXED AT A RATE WHICH INCLUDES COST TO CARRIER FOR IDEMNITY INSURANCE AND CARRIER WILL NOT ACCEPT GOVERNMENT SHIPMENT AT A RATE EXCLUSIVE OF SUCH COST. IS AS FOLLOWS: REFERENCE IS MADE TO SECTION 4 OF THE GOVERNMENT LOSSES IN SHIPMENT ACT. A COPY OF WHICH IS ATTACHED. BECAUSE OF THE FACT THAT SUCH CARRIERS HAVE PECULIAR FACILITIES FOR HANDLING THE SHIPMENTS. SUCH AS CHEAPER RATES OR THE ELIMINATION OF PHYSICAL HAZARDS TO GOVERNMENT EMPLOYEES WHO ARE REQUIRED TO TRANSPORT LARGE AMOUNTS OF CASH THROUGH CITY STREETS. YOUR DECISION IS REQUESTED WHETHER THE PAYMENT OF THE CARRIER'S CHARGES IN CASES WHERE NO SPECIAL RATE IS OBTAINABLE UNDER THESE FACILITIES FOR THE TRANSPORTATION OF VALUABLES WITHOUT INDEMNITY MAY BE CONSIDERED AS PAYMENT OF TRANSPORTATION COSTS ONLY AND NOT BE PROHIBITED BY THE PROVISIONS OF SECTION 4 OF THE GOVERNMENT LOSSES IN SHIPMENT ACT.

A-88302, AUGUST 14, 1937, 17 COMP. GEN. 139

INSURANCE - GOVERNMENT VALUABLES - TRANSPORTATION RATES INCLUDING PREMIUMS - GOVERNMENT LOSSES IN SHIPMENT ACT WHERE CHARGES FOR TRANSPORTATION OF VALUABLES ARE REGULARLY FIXED AT A RATE WHICH INCLUDES COST TO CARRIER FOR IDEMNITY INSURANCE AND CARRIER WILL NOT ACCEPT GOVERNMENT SHIPMENT AT A RATE EXCLUSIVE OF SUCH COST, THE TOTAL SUM PAID FOR THE SHIPMENT MAY BE CONSIDERED AS COST OF TRANSPORTATION AND PAYMENT THEREOF AS NOT IN CONTRAVENTION OF THE GOVERNMENT LOSSES IN SHIPMENT ACT, APPROVED JULY 8, 1937, 50 STAT. 479.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF THE TREASURY, AUGUST 14, 1937:

YOUR LETTER OF AUGUST 11, 1937, IS AS FOLLOWS:

REFERENCE IS MADE TO SECTION 4 OF THE GOVERNMENT LOSSES IN SHIPMENT ACT, PUBLIC, 192, 75TH CONGRESS, FIRST SESSION, APPROVED JULY 8, 1937, A COPY OF WHICH IS ATTACHED.

IT HAS BEEN THE PRACTICE OF THE GOVERNMENT HERETOFORE TO MAKE CERTAIN SHIPMENTS BY CARRIER, OTHER THAN THE POST OFFICE DEPARTMENT, PRINCIPALLY BY EXPRESS AND BY ARMORED CAR, BECAUSE OF THE FACT THAT SUCH CARRIERS HAVE PECULIAR FACILITIES FOR HANDLING THE SHIPMENTS, SUCH AS CHEAPER RATES OR THE ELIMINATION OF PHYSICAL HAZARDS TO GOVERNMENT EMPLOYEES WHO ARE REQUIRED TO TRANSPORT LARGE AMOUNTS OF CASH THROUGH CITY STREETS, OR BECAUSE THE POST OFFICE DEPARTMENT WOULD NOT ACCEPT THE SHIPMENTS DUE TO THEIR PECULIAR CHARACTER. IN SUCH CASES THE TRANSPORTATION CHARGES MAY INCLUDE AN ALLOWANCE FOR THE COST TO THE CARRIER OF PROVIDING INDEMNITY BUT WITHOUT ANY SPECIFIC ALLOCATION BEING MADE IN THE RATE PAID BY THE GOVERNMENT FOR THE INDEMNITY FEATURE.

YOUR DECISION IS REQUESTED WHETHER THE PAYMENT OF THE CARRIER'S CHARGES IN CASES WHERE NO SPECIAL RATE IS OBTAINABLE UNDER THESE FACILITIES FOR THE TRANSPORTATION OF VALUABLES WITHOUT INDEMNITY MAY BE CONSIDERED AS PAYMENT OF TRANSPORTATION COSTS ONLY AND NOT BE PROHIBITED BY THE PROVISIONS OF SECTION 4 OF THE GOVERNMENT LOSSES IN SHIPMENT ACT.

SECTION 4 OF THE GOVERNMENT LOSSES IN SHIPMENT ACT, APPROVED JULY 8, 1937, PUBLIC, NO. 192, PROVIDES:

ON AND AFTER THE EFFECTIVE DATE OF THE REGULATIONS PRESCRIBED UNDER SECTION 1, NO EXECUTIVE DEPARTMENT, INDEPENDENT ESTABLISHMENT, AGENCY, WHOLLY OWNED CORPORATION, OFFICER, OR EMPLOYEE SHALL EXPEND ANY MONEY, OR INCUR ANY OBLIGATION, FOR INSURANCE, OR FOR THE PAYMENT OF PREMIUMS ON INSURANCE, AGAINST LOSS, DESTRUCTION, OR DAMAGE IN THE SHIPMENT OF VALUABLES EXCEPT AS SPECIFICALLY AUTHORIZED BY THE SECRETARY OF THE TREASURY. THE SECRETARY OF THE TREASURY MAY GIVE SUCH AUTHORIZATION IF HE SHALL FIND THAT THE RISK OF LOSS, DESTRUCTION, OR DAMAGE IN SUCH SHIPMENT CANNOT BE ADEQUATELY GUARDED AGAINST BY THE FACILITIES OF THE UNITED STATES OR THAT THE CIRCUMSTANCES ARE SUCH THAT ADEQUATE REPLACEMENT CANNOT BE PROVIDED UNDER THIS ACT.

WHERE THE EXPRESS OR OTHER TRANSPORTATION CHARGES UPON A SHIPMENT ARE REGULARLY FIXED AT A RATE WHICH COVERS THE COST TO THE CARRIER FOR INDEMNITY INSURANCE AND THE CARRIER WILL NOT ACCEPT THE SHIPMENT AT A RATE EXCLUDING SUCH COSTS, THE TOTAL SUM PAID TO THE CARRIER FOR THE SHIPMENT MAY BE CONSIDERED AS TRANSPORTATION COSTS AND PAYMENT THEREOF WILL NOT BE OBJECTED TO BY THIS OFFICE AS IN CONTRAVENTION OF SECTION 4 OF THE ACT OF JULY 8, 1937, SUPRA. ..END :