B-129084, OCTOBER 4, 1956, 36 COMP. GEN. 281

B-129084: Oct 4, 1956

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PROPERTY WHICH IS DAMAGED BY PRIVATE PERSONS MAY NOT BE REGARDED AS "SERVICES FOR PRIVATE PERSONS" AS THAT LANGUAGE IS USED IN THE CORPS OF ENGINEERS REVOLVING FUND AUTHORIZATION. THE REVOLVING FUND AUTHORIZATION FOR TEMPORARY FINANCING OF SERVICES CHARGEABLE TO APPROPRIATIONS WOULD PERMIT TEMPORARY FINANCING OF SUCH REPAIRS PROVIDED THE COST IS ULTIMATELY REFLECTED AS AN OBLIGATION OF THE APPROPRIATION. 1956: REFERENCE IS MADE TO LETTER OF AUGUST 24. THE REVOLVING FUND WAS ESTABLISHED BY THE CIVIL FUNCTIONS APPROPRIATION ACT. COLLECTIONS MADE ON ACCOUNT THEREOF ARE AUTHORIZED TO BE CREDITED TO THE APPROPRIATION THAT BORE THE COST OF REPAIR OR REPLACEMENT OF THE DAMAGED PROPERTY BY SECTION 4 OF THE ACT APPROVED JUNE 20.

B-129084, OCTOBER 4, 1956, 36 COMP. GEN. 281

REVOLVING FUNDS - CORPS OF ENGINEERS - AVAILABILITY FOR REPAIRS TO GOVT. PROPERTY - DAMAGED BY PRIVATE PERSONS ALTHOUGH REPAIRS MADE ON GOVT. PROPERTY WHICH IS DAMAGED BY PRIVATE PERSONS MAY NOT BE REGARDED AS "SERVICES FOR PRIVATE PERSONS" AS THAT LANGUAGE IS USED IN THE CORPS OF ENGINEERS REVOLVING FUND AUTHORIZATION, SO AS TO PERMIT THE INITIAL FINANCING OF SUCH REPAIRS FROM THE REVOLVING FUND, THE REVOLVING FUND AUTHORIZATION FOR TEMPORARY FINANCING OF SERVICES CHARGEABLE TO APPROPRIATIONS WOULD PERMIT TEMPORARY FINANCING OF SUCH REPAIRS PROVIDED THE COST IS ULTIMATELY REFLECTED AS AN OBLIGATION OF THE APPROPRIATION.

TO THE SECRETARY OF THE ARMY, OCTOBER 4, 1956:

REFERENCE IS MADE TO LETTER OF AUGUST 24, 1956, FROM THE ACTING SECRETARY OF THE ARMY, PRESENTING FOR DECISION QUESTIONS RELATING TO THE AVAILABILITY OF THE CIVIL WORKS FUNCTIONS REVOLVING FUND, CORPS OF ENGINEERS, FOR THE TEMPORARY FINANCING OF COSTS OF REPAIRS TO GOVERNMENT PROPERTY SUCH AS LOCKS, DAMS, SEAWALLS, JETTIES AND WHARVES, PENDING REIMBURSEMENT FOR SUCH COSTS FROM PRIVATE PARTIES RESPONSIBLE FOR THE DAMAGES.

THE REVOLVING FUND WAS ESTABLISHED BY THE CIVIL FUNCTIONS APPROPRIATION ACT, 1954, 67 STAT. 199, WHICH PROVIDES, IN PART, AS FOLLOWS:

FOR ESTABLISHMENT OF A REVOLVING FUND, TO BE AVAILABLE WITHOUT FISCAL YEAR LIMITATION, FOR EXPENSES NECESSARY FOR THE MAINTENANCE AND OPERATION OF THE PLANT AND EQUIPMENT OF THE CORPS OF ENGINEERS USED IN CIVIL WORKS FUNCTIONS * * *, TEMPORARY FINANCING OF SERVICES FINALLY CHARGEABLE TO APPROPRIATIONS FOR CIVIL WORKS FUNCTIONS, AND THE FURNISHING OF FACILITIES AND SERVICES FOR MILITARY FUNCTIONS OF THE DEPARTMENT OF THE ARMY AND OTHER GOVERNMENT AGENCIES AND PRIVATE PERSONS, AS AUTHORIZED BY LAW, * *

AS STATED IN THE LETTER OF AUGUST 24, LIABILITY OF PRIVATE PARTIES RESPONSIBLE FOR DAMAGES TO WORKS SUCH AS HEREINBEFORE DESCRIBED ARISES FROM THE PROVISIONS OF SECTION 14 OF THE RIVER AND HARBOR ACT, APPROVED MARCH 3, 1899, 30 STAT. 1152, 33 U.S.C. 408, AND COLLECTIONS MADE ON ACCOUNT THEREOF ARE AUTHORIZED TO BE CREDITED TO THE APPROPRIATION THAT BORE THE COST OF REPAIR OR REPLACEMENT OF THE DAMAGED PROPERTY BY SECTION 4 OF THE ACT APPROVED JUNE 20, 1938, 52 STAT. 805, 33 U.S.C. 571.

IT IS STATED IN THE LETTER THAT CORPS OF ENGINEERS REGULATIONS PRESCRIBING THE PROCEDURES FOR ENFORCEMENT OF 33 U.S.C. 408 PROVIDE THAT IN EACH CASE THE RESPONSIBLE ENGINEER WILL COMMUNICATE DIRECTLY WITH THE RESPONSIBLE PARTIES, GIVING THEM NOTICE TO REPAIR THE DAMAGE BY THEIR OWN LABOR AND AT THEIR OWN EXPENSE WITH A REASONABLE TIME TO BE FIXED IN THE NOTICE. WHERE THE DAMAGE MUST BE REPAIRED WITHIN A REASONABLE TIME, IF THE RESPONSIBLE PARTIES SO REQUEST IN WRITING, THE DISTRICT ENGINEER MAY CLAUSE THE REPAIRS TO BE MADE AT GOVERNMENT EXPENSE AND THEN CALL UPON THE RESPONSIBLE PARTIES TO PAY THE COST OF DAMAGES WHEN FINALLY ASCERTAINED. IT IS FURTHER STATED THAT CURRENT PRACTICE PROVIDES FOR FINANCING THESE REPAIR COSTS FROM CORPS OF ENGINEERS CIVIL PROJECT FUNDS PENDING REIMBURSEMENT, AND THAT DUE TO THE SUBSTANTIAL AMOUNTS OF FUNDS REQUIRED TO FINANCE SUCH REPAIR COSTS, THE UNPREDICTABLE NATURE OF INCURRENCE, AND THE PUBLIC INTEREST REQUIREMENT, IT IS SOMETIMES NECESSARY TO DEFER SCHEDULED REHABILITATION AND MAINTENANCE WORK PENDING COLLECTION OF THE AMOUNT DUE FROM THE RESPONSIBLE PARTY. SINCE THE REGULATIONS PROVIDE FOR A WRITTEN AGREEMENT WITH THE RESPONSIBLE PRIVATE PARTIES TO PERFORM CERTAIN WORK, IT IS STATED IN THE ACTING SECRETARY'S LETTER THAT IT APPEARS THAT PERFORMANCE OF THE WORK UNDER THE REVOLVING FUND MAY BE APPROPRIATE WITHIN THAT PART OF THE LEGISLATION PROVIDING FOR "FURNISHING FACILITIES AND SERVICES FOR * * * AND PRIVATE PERSONS * * *," AND THE FOLLOWING QUESTIONS ARE PRESENTED FOR OUR DECISION:

1. MAY THE REVOLVING FUND, CORPS OF ENGINEERS BE USED TO INITIALLY FINANCE COSTS OF REPAIRS RESULTING FROM DAMAGE TO GOVERNMENT PROPERTY WHICH REPRESENTS INTEGRAL PARTS OF OR IS UTILIZED ON PROJECTS WHICH ARE UNDER JURISDICTION OF THE CORPS OF ENGINEERS FOR CONSTRUCTION, OPERATION, OR MAINTENANCE PURPOSES, WHEN THE DAMAGES ARE REIMBURSABLE FROM PRIVATE PERSONS?

2. IF THE ANSWER TO QUESTION 1 IS IN THE AFFIRMATIVE, MAY SUCH DAMAGE COSTS BE RETAINED AS AN ACCOUNT RECEIVABLE UNDER THE REVOLVING FUND UNTIL COLLECTED OR UNTIL CONCLUSIVE PROOF OF UNCOLLECTIBILITY FROM THE DEBTOR IS OBTAINED?

REPAIRS OF THE NATURE HERE INVOLVED ARE TO BE MADE UPON GOVERNMENT PROPERTY, THE PRESERVATION AND MAINTENANCE OF WHICH IS A RESPONSIBILITY OF THE CORPS OF ENGINEERS, AND AS SUCH THEY DO NOT APPEAR TO BE "SERVICES FOR * * * PRIVATE PERSONS" WITHIN THE MEANING OF THOSE WORDS AS USED IN THE REVOLVING FUND AUTHORIZATION. FURTHERMORE, IN ALL PROBABILITY INSTANCES WOULD ARISE WHERE THE RESPONSIBLE PARTIES WOULD BE UNABLE TO REIMBURSE THE GOVERNMENT FOR THE COST OF REPAIRS. THE RESULT IN SUCH INSTANCES WOULD BE AN IMPAIRMENT OF THE CORPUS OF THE REVOLVING FUND INCONSISTENT WITH ITS ENABLING LEGISLATION REQUIRING RECOVERY OF COST. IT APPEARS, HOWEVER, THAT THE BASIC AVAILABILITY OF THE APPROPRIATION UNDER THE HEAD " OPERATION AND MAINTENANCE, GENERAL, CORPS OF ENGINEERS, CIVIL," FOR THE MAINTENANCE AND CARE OF WORKS SUCH AS HERE CONCERNED IS IN NO WAY AFFECTED BY WHETHER OR NOT COSTS OF REPAIRS ARE REIMBURSED. THUS, WHILE IT WOULD NOT APPEAR PROPER TO USE THE REVOLVING FUND TO FINANCE REPAIRS TO GOVERNMENT PROPERTY FOR THE ACCOUNT OF PRIVATE PERSONS, SUCH FUND MAY, UNDER THE AUTHORITY FOR "TEMPORARY FINANCING OF SERVICES CHARGEABLE TO APPROPRIATIONS FOR CIVIL WORKS FUNCTIONS," BE USED FOR TEMPORARY FINANCING OF SERVICES CHARGEABLE TO THE " OPERATION AND MAINTENANCE" APPROPRIATION. QUESTION 1 IS ACCORDINGLY ANSWERED IN THE NEGATIVE INASMUCH AS IT PERTAINS TO INITIAL FINANCING FOR, AND ON ACCOUNT OF, PRIVATE PERSONS--- COSTS OF INITIAL FINANCING FROM THE REVOLVING FUND IN SUCH CASES BEING PROPERLY FOR REFLECTION AS OBLIGATIONS OF THE " OPERATION AND MAINTENANCE" APPROPRIATION.

SINCE QUESTION 1 IS ANSWERED IN THE NEGATIVE, NO ANSWER TO QUESTION 2 IS REQUIRED.