B-135624, JUN. 24, 1958

B-135624: Jun 24, 1958

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COMMONWEALTH OF MASSACHUSETTS: REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 25. THESE CONTRACTS WERE BETWEEN THE COMMONWEALTH AND THE INTERNATIONAL COOPERATION ADMINISTRATION (OR ITS PREDECESSORS). THE MAKING OF GRANTS FOR EDUCATION OF DEPENDENTS OF CERTAIN CIVILIAN EMPLOYEES OF THE UNITED STATES IN FOREIGN AREAS UNDER REGULATIONS PROMULGATED BY THE PRESIDENT WAS FIRST AUTHORIZED BY SECTION 10 OF THE ACT OF APRIL 5. THE ALLOWANCES WERE AUTHORIZED BY THE ACT TO BE EFFECTIVE UPON PROMULGATION OF REGULATIONS OF THE PRESIDENT AND. THE ALLOWANCES UNDER THE ACT AND REGULATIONS ARE NOT AUTHORIZED TO BE PAID TO ALL EMPLOYEES OF THE UNITED STATES IN FOREIGN COUNTRIES AND ARE PAYABLE ONLY UPON APPLICATION OF THE EMPLOYEE AND THE SPECIFIC GRANTING OF SUCH ALLOWANCE BY THE HEAD OF THE AGENCY OR ONE AUTHORIZED TO ACT IN HIS STAND.

B-135624, JUN. 24, 1958

TO DR. SAMUEL B. KIRKWOOD, COMMISSIONER, DEPARTMENT OF PUBLIC HEALTH, COMMONWEALTH OF MASSACHUSETTS:

REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 25, 1958, CONCERNING YOUR REQUEST THAT WE RECONSIDER THE CLAIMS OF MR. JOHN A. BELLISIA, DR. LAWRENCE C. KINGSLAND, JR., DR. DWIGHT C. MONNIER, AND MR. THEODORE SHEPARDSON FOR REIMBURSEMENT OF EDUCATIONAL EXPENSES AS EMPLOYEES OF THE COMMONWEALTH OF MASSACHUSETTS WHILE STATIONED IN PAKISTAN AND EMPLOYED ON CONTRACT NOS. SCC-21470 AND ICA-W-127, FINANCED BY THE INTERNATIONAL COOPERATION ADMINISTRATION (OR ITS PREDECESSORS). THESE CONTRACTS WERE BETWEEN THE COMMONWEALTH AND THE INTERNATIONAL COOPERATION ADMINISTRATION (OR ITS PREDECESSORS).

THE MAKING OF GRANTS FOR EDUCATION OF DEPENDENTS OF CERTAIN CIVILIAN EMPLOYEES OF THE UNITED STATES IN FOREIGN AREAS UNDER REGULATIONS PROMULGATED BY THE PRESIDENT WAS FIRST AUTHORIZED BY SECTION 10 OF THE ACT OF APRIL 5, 1955, 69 STAT. 27, 22 U.S.C., SUPP. V, 1131 (A) (IV). THE ALLOWANCES WERE AUTHORIZED BY THE ACT TO BE EFFECTIVE UPON PROMULGATION OF REGULATIONS OF THE PRESIDENT AND, UNDER AUTHORITY DELEGATED BY EXECUTIVE ORDER, THE STATE DEPARTMENT PROMULGATED STANDARDIZED REGULATIONS (GOVERNMENT CIVILIANS, FOREIGN AREAS) EFFECTIVE JULY 10, 1955, WHICH PERMITTED BUT DID NOT REQUIRE THE HEADS OF AGENCIES TO MAKE EDUCATIONAL ALLOWANCES FOR DEPENDENTS OF CERTAIN CIVILIAN EMPLOYEES. THE ALLOWANCES UNDER THE ACT AND REGULATIONS ARE NOT AUTHORIZED TO BE PAID TO ALL EMPLOYEES OF THE UNITED STATES IN FOREIGN COUNTRIES AND ARE PAYABLE ONLY UPON APPLICATION OF THE EMPLOYEE AND THE SPECIFIC GRANTING OF SUCH ALLOWANCE BY THE HEAD OF THE AGENCY OR ONE AUTHORIZED TO ACT IN HIS STAND. SEE PARAGRAPHS 216, 272.11, AND 272.12 OF THE STATE DEPARTMENT'S STANDARDIZED REGULATIONS.

YOU (AND THE ABOVE-NAMED COMMONWEALTH EMPLOYEES) CLAIM, IN EFFECT, THAT UNDER THE ABOVE REFERRED-TO CONTRACTS THESE EMPLOYEES, APPARENTLY AS THIRD -PARTY BENEFICIARIES, WERE ENTITLED TO REIMBURSEMENT OF EDUCATIONAL EXPENSES WHILE STATIONED IN PAKISTAN FOR THE PERIOD SEPTEMBER 1955 (THAT IS, THE SCHOOL YEAR BEGINNING IN SEPTEMBER OR OCTOBER), THROUGH FEBRUARY 14, 1957, UNDER THE FINAL SENTENCE OF SECTION 2, ARTICLE II OF CONTRACT NO. SCC-21470, DATED NOVEMBER 15, 1952.

THAT PARAGRAPH IN ITS ENTIRETY READS AS FOLLOWS:

"THE TECHNICAL COOPERATION ADMINISTRATION (PREDECESSOR OF THE INTERNATIONAL COOPERATION ADMINISTRATION PURSUANT TO THIS AGREEMENT, SHALL PROVIDE TRANSPORTATION TO AND WITHIN PAKISTAN OR OTHER COUNTRIES IN WHICH SERVICES ARE TO BE PERFORMED AND RETURN, AND PAY EXPENSES AND ALLOWANCES TO SUCH PERSONNEL AS APPROVED BY THE TECHNICAL COOPERATION ADMINISTRATION. THE TECHNICAL COOPERATION ADMINISTRATION SHALL PROVIDE THE NECESSARY ADMINISTRATIVE SERVICES INCIDENT TO TRANSPORTING SUCH PERSONNEL AND THEIR FAMILIES TO AND WITHIN PAKISTAN OR OTHER COUNTRIES AND RETURN. THE TECHNICAL COOPERATION ADMINISTRATION SHALL FOLLOW THE POLICIES AS TO TRAVEL, EXPENSES AND ALLOWANCES FOR EMPLOYEES OF THE COMMONWEALTH THAT ARE GENERALLY FOLLOWED BY THE TECHNICAL COOPERATION ADMINISTRATION IN THE PARTICULAR COUNTRY IN WHICH SUCH EMPLOYEES ARE PERFORMING SERVICES.'

YOU CONTEND THAT THE FINAL SENTENCE OF THIS PARAGRAPH STATES VERY CLEARLY THAT THE EMPLOYEES IN QUESTION "SHOULD RECEIVE FROM THE FEDERAL GOVERNMENT "TRAVEL EXPENSES AND ALLOWANCES" THAT I.C.A. EMPLOYEES RECEIVED AND THIS NOT HAVING BEEN DONE SEEMS TO HAVE BEEN A DIRECT VIOLATION OF THE CONTRACT," AND THAT DURING THE PERIOD INVOLVED INTERNATIONAL COOPERATION ADMINISTRATION EMPLOYEES EMPLOYED DIRECTLY BY THAT ADMINISTRATION WERE PAID AN ALLOWANCE FOR EDUCATIONAL EXPENSES.

AS YOU NO DOUBT MUST CONCEDE, SECTION 2, ARTICLE II, OF THE CONTRACT WAS WRITTEN IN 1952, LONG BEFORE EDUCATIONAL ALLOWANCES WERE AUTHORIZED TO BE PAID TO ANYONE IN JULY 1955. IT DOES NOT APPEAR, THEREFORE, THAT IT REASONABLY CAN BE CONTENDED THAT THE SENTENCE IN QUESTION HAS REFERENCE TO SUCH ALLOWANCES. MOREOVER, AS POINTED OUT IN THE SECOND PARAGRAPH OF THIS LETTER, THE EDUCATIONAL ALLOWANCES ARE NOT GRANTED UNIFORMLY TO ALL EMPLOYEES IN FOREIGN COUNTRIES (FOR EXAMPLE, THE ACT AND REGULATIONS RESTRICT THE ALLOWANCE TO DEPENDENTS OF EMPLOYEES WHO ARE CITIZENS OF THE UNITED STATES AND IT COULD NOT BE PAID FOR DEPENDENTS OF NATIVE EMPLOYEES); ALSO, SUCH ALLOWANCES ARE NOT PAYABLE EXCEPT UPON APPLICATION AND APPROVAL (OR THE MAKING OF THE GRANT) BY THE HEAD OF THE AGENCY INVOLVED. UNDER SUCH CONDITIONS, IT DOES NOT APPEAR THAT THERE WAS A POLICY GENERALLY FOLLOWED BY THE TECHNICAL COOPERATION ADMINISTRATION OF MAKING SUCH EDUCATIONAL ALLOWANCES IN THE COUNTRY IN WHICH SUCH EMPLOYEES WERE PERFORMING SERVICES AS SET FORTH IN THE FINAL SENTENCES OF SECTION 2 OF THE CONTRACT. ALSO, AS THERE WAS NOADMINISTRATIVE APPROVAL OF THE EDUCATIONAL ALLOWANCES FOR THE PERIOD INVOLVED TO THE INVOLVED EMPLOYEES, THE ALLOWANCES WOULD NOT BE PAYABLE EVEN IF THE EMPLOYEES WERE HIRED DIRECTLY BY THE TECHNICAL COOPERATION ADMINISTRATION OR ITS SUCCESSOR AGENCIES. MOREOVER, THE LACK OF ADMINISTRATIVE APPROVAL OF SUCH ALLOWANCES, UNDER THE FIRST SENTENCE OF THE CONTRACT PROVISION QUOTED ABOVE, WOULD APPEAR TO PRECLUDE PAYMENT SINCE THE CONTRACT PROVIDED FOR PAYMENT ONLY OF SUCH ALLOWANCES "AS APPROVED BY THE TECHNICAL COOPERATION ADMINISTRATION.' IN THE ABSENCE OF SUCH APPROVAL FOR THE PERIOD INVOLVED, NO AMOUNTS WOULD BE DUE FOR SUCH EDUCATIONAL ALLOWANCES UNDER THE CONTRACT PROVISION CONSIDERED AS A WHOLE EVEN IF THE THIRD SENTENCE OF SECTION 2 QUOTED ABOVE WERE AS CLEAR AS YOU INDICATE YOU BELIEVE.

WE DO NOT FIND THE PROVISION TO BE NEARLY THAT CLEAR. IT REASONABLY COULD MEAN THE ADMINISTRATION WOULD FOLLOW THE POLICIES THAT WERE IN EFFECT AT THE TIME OF THE MAKING OF THE CONTRACT (OR THOSE IN EFFECT AT THE TIME THE ALLOWANCES ARE CLAIMED TO HAVE ACCRUED). IT COULD MEAN THE POLICIES APPLICABLE TO ALL TECHNICAL COOPERATION ADMINISTRATION EMPLOYEES IN THE COUNTRY TO WHICH ASSIGNED (OR TO EMPLOYEES HIRED UNDER SIMILAR CONTRACTS WITH OTHER STATE AGENCIES, IN WHICH CASE IT WOULD AMOUNT TO A PROVISION NOT TO DISCRIMINATE AGAINST MASSACHUSETTS' CONTRACT EMPLOYEES AS OPPOSED TO SIMILAR EMPLOYEES OF OTHER STATES). IT APPEARS THAT SUCH AMBIGUITY WAS RECOGNIZED AT THE TIME OF EXECUTION OF THE SUCCESSOR CONTRACT ICA-W-127-1, EFFECTIVE JANUARY 1, 1956, WHICH PROVIDES, IN ARTICLE III, THAT---

"IT IS MUTUALLY UNDERSTOOD AND AGREED THAT THE CONTRACT CONCLUDED BETWEEN THE FOREIGN OPERATIONS ADMINISTRATION AND CONTRACTOR ON NOVEMBER 13, 1952, AS HERETOFORE DULY AMENDED, IS BY THIS CONTRACT AMENDED AND EXTENDED - IT BEING UNDERSTOOD, HOWEVER, THAT THIS CONTRACT EMBRACES ALL THE TERMS AND CONDITIONS OF THE AGREEMENT BETWEEN THE PARTIES CONCERNING THE SERVICES WHICH CONTRACTOR SHALL PERFORM IN RELATION TO THE ICA PROGRAM OF TECHNICAL ADVICE AND ASSISTANCE IN PAKISTAN AND, TO THE EXTENT THAT ANY TERMS OR CONDITIONS OF THE CONTRACT, DATED NOVEMBER 13, 1952, AS HERETOFORE DULY AMENDED, MAY BE INCONSISTENT WITH THE TERMS AND CONDITIONS OF THIS INSTANT CONTRACT, THAT THE TERMS AND CONDITIONS OF THIS CONTRACT SHALL BE CONTROLLING * * *.'

ALSO ARTICLE VI E OF THAT CONTRACT PROVIDES---

"E.DIFFERENTIALS AND ALLOWANCES

"THE FOLLOWING DIFFERENTIALS AND ALLOWANCES AT THE RATES AND SUBJECT TO THE CONDITIONS PROVIDED UNDER ICA PRACTICE, PURSUANT TO REGULATIONS APPLICABLE TO ICA DIRECT EMPLOYEES STATIONED IN PAKISTAN IN COMPARABLE POSITIONS AS SUCH REGULATIONS MAY BE AMENDED FROM TIME TO TIME TO BE PAID BY USOM: (A) SALARY DIFFERENTIAL; (B) POST TRANSFER ALLOWANCE; (C) COST OF LIVING ALLOWANCE; (D) TEMPORARY QUARTERS ALLOWANCE; AND (E) QUARTERS ALLOWANCE (IN THE EVENT HOUSING IS NOT FURNISHED). IN THE EVENT THAT ICA/W SHALL, IN THE FUTURE, ADOPT A POLICY EXTENDING "EDUCATIONAL ALLOWANCES" BENEFITS TO CONTRACT EMPLOYEES SERVING UNDER CONTRACTS COMPARABLE TO COMMONWEALTH OF MASSACHUSETTS/ICA AGREEMENTS, AN ALLOWANCE OF THIS NATURE WILL BE AUTHORIZED UNDER THE TERMS AND CONDITIONS OF THIS PARAGRAPH.'

IT SEEMS CLEAR FROM THE PROVISIONS OF SUCH CONTRACT THAT EDUCATIONAL ALLOWANCE BENEFITS HAD NOT THEN BEEN EXTENDED TO EMPLOYEES UNDER THE CONTRACT AND THE RECORD SHOWS SUCH ALLOWANCES WERE NOT GRANTED UNTIL FEBRUARY 1957.

THUS, INASMUCH AS THERE WAS NO PRACTICE OF THE TECHNICAL COOPERATION ADMINISTRATION (OR ITS SUCCESSORS) TO PAY EDUCATIONAL ALLOWANCES FOR THE PERIOD INVOLVED TO ITS EMPLOYEES GENERALLY IN PAKISTAN--- SINCE THERE WAS NO GENERAL APPROVAL OR GRANTING OF SUCH ALLOWANCES TO ITS EMPLOYEES IN THAT COUNTRY FOR THAT PERIOD NOR APPROVAL OF SUCH A GRANT TO THE PARTICULAR EMPLOYEES INVOLVED--- WE FIND NO PROPER BASIS FOR PAYMENT OF THE EDUCATIONAL ALLOWANCES CLAIMED. WE THEREFORE SUSTAIN THE ACTION OF OUR CLAIMS DIVISION IN DISALLOWING SUCH CLAIMS.

COPIES OF THIS DECISION ARE BEING FORWARDED TO EACH OF THE EMPLOYEES INVOLVED SO THEY MAY BE FULLY ADVISED OF THE REASONS REQUIRING THE DISALLOWANCE OF THEIR CLAIMS.