B-141693, OCTOBER 12, 1961, 41 COMP. GEN. 235

B-141693: Oct 12, 1961

Additional Materials:

Contact:

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

 

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

- ADMINISTRATIVE DETERMINATIONS - CONCLUSIVENESS - EXTENT OF GENERAL ACCOUNTING OFFICE AUTHORITY - CLAIM SETTLEMENT ALTHOUGH THE SAN CARLOS IRRIGATION PROJECT WHICH HAS A CLAIM AGAINST THE DEPARTMENT OF THE AIR FORCE FOR REIMBURSEMENT FOR REPAIRS TO A POWER LINE DAMAGED AS THE RESULT OF A CRASH OF A CIVIL AIR PATROL PLANE IS AN INSTRUMENTALITY OF THE UNITED STATES. THE FUNDS OF THE PROJECT AVAILABLE FOR REPAIR OF THE DAMAGE ARE NOT APPROPRIATED FUNDS BUT FUNDS OF THE PROJECT BENEFICIARIES. THE RULE THAT THERE CAN BE NO REIMBURSEMENT BETWEEN DEPARTMENTS AND AGENCIES FOR DAMAGES TO OR LOSS OF PROPERTY BECAUSE THE PROPERTY BELONGS TO THE GOVERNMENT AND NOT THE SEPARATE AGENCIES AND FEDERAL FUNDS ARE INVOLVED DOES NOT PRECLUDE THE PRESENTATION OF THE DAMAGE CLAIM BY THE DEPARTMENT OF THE INTERIOR ON BEHALF OF THE PROJECT BENEFICIARIES.

B-141693, OCTOBER 12, 1961, 41 COMP. GEN. 235

DEPARTMENTS AND ESTABLISHMENTS - DAMAGE CLAIMS - REIMBURSEMENT PROHIBITION--- ADMINISTRATIVE DETERMINATIONS - CONCLUSIVENESS - EXTENT OF GENERAL ACCOUNTING OFFICE AUTHORITY - CLAIM SETTLEMENT ALTHOUGH THE SAN CARLOS IRRIGATION PROJECT WHICH HAS A CLAIM AGAINST THE DEPARTMENT OF THE AIR FORCE FOR REIMBURSEMENT FOR REPAIRS TO A POWER LINE DAMAGED AS THE RESULT OF A CRASH OF A CIVIL AIR PATROL PLANE IS AN INSTRUMENTALITY OF THE UNITED STATES, THE FUNDS OF THE PROJECT AVAILABLE FOR REPAIR OF THE DAMAGE ARE NOT APPROPRIATED FUNDS BUT FUNDS OF THE PROJECT BENEFICIARIES--- THE PIMA INDIANS--- HELD IN TRUST FOR THEM BY THE GOVERNMENT AND, THEREFORE, THE RULE THAT THERE CAN BE NO REIMBURSEMENT BETWEEN DEPARTMENTS AND AGENCIES FOR DAMAGES TO OR LOSS OF PROPERTY BECAUSE THE PROPERTY BELONGS TO THE GOVERNMENT AND NOT THE SEPARATE AGENCIES AND FEDERAL FUNDS ARE INVOLVED DOES NOT PRECLUDE THE PRESENTATION OF THE DAMAGE CLAIM BY THE DEPARTMENT OF THE INTERIOR ON BEHALF OF THE PROJECT BENEFICIARIES. ALTHOUGH THE DEPARTMENT OF THE INTERIOR IN THE PRESENTATION OF A CLAIM ON BEHALF OF THE SAN CARLOS IRRIGATION PROJECT FOR REIMBURSEMENT FOR REPAIRS TO A POWER LINE DAMAGED AS A RESULT OF A CRASH OF A CIVIL AIR PATROL PLANE IS AN INSTRUMENTALITY OF THE GOVERNMENT SO THAT IT FALLS WITHIN THE LITERAL TERMS OF PARAGRAPH 2C OF AIR FORCE REGULATION 112-2, MARCH 26, 1959, WHICH PRECLUDES THE AIR FORCE FROM CONSIDERING CLAIMS FOR PROPERTY LOSS OR DAMAGE OF GOVERNMENT AGENCIES, THE STATUTES UNDER WHICH THE CLAIM MIGHT BE COMPENSABLE--- 10 U.S.C. 2733, PROPERTY LOSS INCIDENT TO NONCOMBAT ACTIVITIES, AND 28 U.S.C. 2671, FEDERAL TORT CLAIMS--- MAKE THE ADMINISTRATIVE SETTLEMENT ACTION CONCLUSIVE SO THAT THE GENERAL ACCOUNTING OFFICE CANNOT REQUIRE THE AIR FORCE TO CONSTRUE THE REGULATIONS AS AUTHORIZING COGNIZANCE OF THE CLAIM ON THE BASIS THAT IT IS A CLAIM ON BEHALF OF THE PROJECT BENEFICIARIES--- THE PIMA INDIANS--- AND NOT A CLAIM OF A GOVERNMENT AGENCY INVOLVING APPROPRIATED FUNDS.

TO THE SECRETARY OF THE INTERIOR, OCTOBER 12, 1961:

BY LETTER OF JULY 25, 1961, THE ASSISTANT SECRETARY OF INTERIOR PRESENTED FOR OUR CONSIDERATION THE QUESTION OF WHETHER A CLAIM AGAINST THE AIR FORCE BY THE BUREAU OF INDIAN AFFAIRS ON BEHALF OF THE SAN CARLOS IRRIGATION PROJECT, COOLIDGE, ARIZONA, FOR DAMAGES IN THE AMOUNT OF $1,252.02 TO THE PROJECT POWER LINE CAUSED BY A CIVIL AIR PATROL PLANE CRASH CONSTITUTES A CLAIM BY ONE GOVERNMENT AGENCY AGAINST ANOTHER AND THEREFORE NOT PAYABLE.

THE SAN CARLOS PROJECT WAS INITIALLY AUTHORIZED BY SECTION 10 OF THE ACT OF MARCH 3, 1905, 33 STAT. 1048, 1081, WHICH PROVIDED:

FOR THE CONSTRUCTION OF AN IRRIGATION SYSTEM NECESSARY FOR DEVELOPING AND FURNISHING A WATER SUPPLY FOR THE IRRIGATION OF THE LANDS OF THE PIMA INDIANS IN THE VICINITY OF SACATON AND THE GILA RIVER INDIAN RESERVATION THE SUM OF FIFTY THOUSAND DOLLARS TO BE EXPENDED UNDER THE DIRECTION OF THE SECRETARY OF THE INTERIOR: PROVIDED, THAT THE TOTAL COST OF THE ENTIRE CONSTRUCTION AND INSTALLATION OF SAID IRRIGATING SYSTEM SHALL NOT EXCEED FIVE HUNDRED AND FORTY THOUSAND DOLLARS: PROVIDED FURTHER, THAT WHEN SAID IRRIGATION SYSTEM IS IN SUCCESSFUL OPERATION AND THE INDIANS HAVE BECOME SELF SUPPORTING THE COST OF OPERATING THE SAID SYSTEM SHALL BE EQUITABLY APPORTIONED UPON THE LANDS IRRIGATED AND TO THE ANNUAL CHARGE SHALL BE ADDED AN AMOUNT SUFFICIENT TO PAY BACK INTO THE TREASURY THE COST OF THE WORK WITHIN THIRTY YEARS, SUITABLE DEDUCTION BEING MADE FOR THE AMOUNTS RECEIVED FROM DISPOSAL OF LANDS WHICH NOW FORM A PART OF THE SAID RESERVATION.

OTHER ACTS FOLLOWED PROVIDING REIMBURSABLE FUNDS FOR CONTINUATION AND COMPLETION OF THE PROJECT. THE ACT OF AUGUST 24, 1912, 37 STAT. 518, 522, PROVIDED FOR LIENS AGAINST THE INDIAN LANDS INVOLVED FOR PROPORTIONATE REIMBURSABLE COSTS; THE ACT OF MAY 18, 1916, 39 STAT. 123, 130, PROVIDED FOR CONSTRUCTION OF A DAM AND FACILITIES, MAKING THE COSTS REIMBURSABLE FROM CHARGES BASED ON INDIAN AND NON-INDIAN LAND ACREAGE; AND THE ACT OF JUNE 7, 1924, 43 STAT. 475, PROVIDED FOR CONTINUATION OF CONSTRUCTION WORK, FOR REPAYMENT OF COSTS, AND FOR LIENS. THE ACT OF MARCH 7, 1928, 45 STAT. 200, 210, AUTHORIZED A "* * * CONTRACT FOR DEVELOPMENT OF ELECTRICAL POWER AT THE COOLIDGE DAM AS AN INCIDENT TO THE USE OF THE COOLIDGE RESERVOIR FOR IRRIGATION * * *; " AND THE APPROPRIATION ACT PROVIDING FUNDS FOR CONSTRUCTION OF THE POWER PLANT, APPROVED MAY 29, 1928, 45 STAT. 883, 900, STIPULATES:

* * * THAT THE COST OF SUCH POWER PLANT SHALL BE AN OBLIGATION OF THE DISTRICT, PROVIDED FOR IN THE ACT OF JUNE 7, 1924, AND THE PIMA INDIANS, IN ACCORDANCE WITH THEIR RESPECTIVE ACREAGE WITHIN THE SAN CARLOS PROJECT, AND THE CONTRACT WITH SUCH DISTRICT, AS REQUIRED BY THE ACT OF JUNE 7, 1924, SHALL CONTAIN PROPER PROVISION OBLIGATING THE DISTRICT TO PAY ITS SHARE OF THE COST THEREOF; AND THE TOTAL SUM HEREIN APPROPRIATED SHALL BE REIMBURSED AS A PART OF THE CONSTRUCTION COST OF THE SAN CARLOS PROJECT AND UNDER THE CONDITIONS AND PROVISIONS OF THAT ACT. * * *

FINALLY, THE ACT OF JUNE 5, 1934, 48 STAT. 881, AMENDING THE VARIOUS STATUTES RELATING TO THE SAN CARLOS PROJECT, PROVIDES:

* * * THAT THE ACT OF CONGRESS APPROVED JUNE 7, 1924 (43 STAT. L. 475, 476), COMMONLY CALLED THE " SAN CARLOS ACT," AND ACTS SUPPLEMENTARY THERETO, INCLUDING THE ACT OF CONGRESS APPROVED MARCH 7, 1928 (45 STAT. L. 210-212), AND ACTS SUPPLEMENTARY THERETO, BE, AND THE SAME ARE HEREBY, AMENDED SO AS TO PROVIDE THAT THE CONSTRUCTION COST OF THE SAN CARLOS PROJECT, INCLUDING THE COST OF THE POWER DEVELOPMENT AT THE COOLIDGE DAM AND THE TRANSMISSION LINE OR LINES SHALL BE REPAID WITHOUT INTEREST, AND THAT PART THEREOF TO BE PAID ON ACCOUNT OF THE LANDS IN PUBLIC OR PRIVATE OWNERSHIP SHALL BE REPAID IN FORTY EQUAL ANNUAL INSTALLMENTS BEGINNING ON DECEMBER 1, 1935, THE DATE FIXED BY THE PUBLIC NOTICE HERETOFORE ISSUED BY THE SECRETARY OF THE INTERIOR. THE SECRETARY OF THE INTERIOR, WITH THE CONSENT OF THE SAN CARLOS IRRIGATION AND DRAINAGE DISTRICT, IS HEREBY AUTHORIZED TO MODIFY THE EXISTING REPAYMENT CONTRACT IN ACCORDANCE HEREWITH.

THE COST OF REPAIRING THE SUBJECT DAMAGES HAS BEEN PAID FROM POWER REVENUES CREDITED TO THE TRUST FUND ACCOUNT," POWER SYSTEMS, INDIAN IRRIGATION PROJECTS, BUREAU OF INDIAN AFFAIRS ( SAN CARLOS PROJECT)," ESTABLISHED PURSUANT TO THE ACT OF AUGUST 7, 1946, 60 STAT. 895, 31 U.S.C. 725S-1, WHICH FUND IS AVAILABLE FOR EXPENDITURE IN CARRYING OUT THE PURPOSES FOR WHICH THE COLLECTIONS WERE MADE.

THE ASSISTANT SECRETARY STATES THAT IN VIEW OF THE NATURE OF THE PROJECT AND THE STATUTORY REQUIREMENTS PLACING THE FINANCIAL OBLIGATION THEREFOR UPON THE CONSTITUENCY, CREATING A DEBTOR-CREDITOR RELATIONSHIP BETWEEN THE PROJECT BENEFICIARIES AND THE UNITED STATES SUPPORTED BY A REPAYMENT CONTRACT ON ACCOUNT OF LANDS IN PRIVATE OWNERSHIP AND LIENS AGAINST INDIAN LANDS, YOUR DEPARTMENT FEELS THAT THE PROJECT (ON BEHALF OF THE BENEFICIARIES CHARGEABLE WITH THE COST) SHOULD BE RECOGNIZED AS A QUALIFIED CLAIMANT IRRESPECTIVE OF THE OPERATING CONTROL AND CREDITOR RELATIONSHIP OF THE UNITED STATES. THE ASSISTANT SECRETARY CONTENDS THAT TO CONCLUDE OTHERWISE WOULD BE TO CHARGE THE PROJECT BENEFICIARIES UNJUSTLY WITH THE COST OF THE DAMAGES.

THE DEPARTMENT OF THE AIR FORCE, RELYING UPON THE DECISION REPORTED AT 25 COMP. GEN. 49, DENIED THE CLAIM ON THE GROUND THAT THE SAN CARLOS IRRIGATION PROJECT IS A FEDERAL INSTRUMENTALITY AND THEREFORE NOT A COGNIZABLE CLAIMANT UNDER AIR FORCE REGULATIONS. THE CITED CASE INVOLVED DAMAGE CLAIMS BY THE INLAND WATERWAYS CORPORATION AND THE DEFENSE PLANT CORPORATION AGAINST THE NAVY DEPARTMENT AND IT WAS HELD THEREIN, NOTWITHSTANDING THE COMMERCIAL NATURE OF THE CORPORATION ACTIVITIES, THAT NAVY DEPARTMENT APPROPRIATIONS WERE NOT AVAILABLE TO PAY CLAIMS FOR DAMAGES CAUSED BY DEPARTMENT VESSELS TO PROPERTY OF THE CORPORATIONS SINCE THE CORPORATIONS WERE INSTRUMENTALITIES OF THE UNITED STATES PERFORMING GOVERNMENTAL FUNCTIONS WITH FEDERAL FUNDS.

A PRIMARY PURPOSE OF THE SAN CARLOS PROJECT IS TO IMPROVE AND DEVELOP THE TRUST LAND RESOURCES OF THE PIMA INDIANS TO PROVIDE THEM A BETTER ECONOMIC BASE OF LIVELIHOOD. THE PROJECT IS DESIGNED TO OPERATE AS A SELF- SUPPORTING ORGANIZATION RATHER THAN AS AN APPROPRIATION FINANCED ACTIVITY. ALTHOUGH INITIAL CONSTRUCTION OF THE PROJECT WAS FINANCED WITH APPROPRIATED FUNDS, OPERATION AND MAINTENANCE COSTS GENERALLY ARE DEFRAYED THROUGH ASSESSMENTS AGAINST THE PROJECT BENEFICIARIES AND AND THE BASIC FEDERALLY FINANCED CONSTRUCTION COSTS ARE ALSO TO BE REPAID BY THE BENEFICIARIES PURSUANT TO THE AUTHORIZING STATUTES. OPERATION OF THE PROJECT IS GOVERNED BY THE TERMS OF A REPAYMENT CONTRACT REQUIRED BY THE ACT OF JUNE 7, 1924, ABOVE, BETWEEN THE UNITED STATES AND THE SAN CARLOS IRRIGATION AND DRAINAGE DISTRICT, ARIZONA, THE FORMATION OF WHICH WAS ALSO REQUIRED BY THE 1924 ACT. WITHOUT DETAILING THE PROVISIONS OF THIS REPAYMENT CONTRACT--- WHICH GENERALLY COVER THE ASSESSMENT AND REPAYMENT OBLIGATIONS OF THE DISTRICT AS REPRESENTATIVE OF THE PROJECT USERS--- IT IS CLEAR THEREFROM AND FROM THE UNDERLYING STATUTES AND THE APPLICABLE REGULATIONS PROMULGATED BY THE SECRETARY OF THE INTERIOR (25 CFR 221.63 ET SEQ.; ID. 233) THAT FEDERAL CONTROL OF THE PROJECT IS IN ESSENTIALLY A TRUST CAPACITY FOR THE BENEFIT OF A PARTICULAR GROUP.

UNDER THESE CIRCUMSTANCES WE AGREE THAT THE "INTERDEPARTMENTAL WAIVER" RULE IS NOT APPLICABLE. THAT RULE IS PREMISED IN PART ON THE CONCEPT THAT PROPERTY OF THE VARIOUS AGENCIES AND INSTRUMENTALITIES OF THE GOVERNMENT IS NOT THE PROPERTY OF SEPARATE ENTITIES BUT RATHER OF THE GOVERNMENT AS A SINGLE ENTITY, AND THERE CAN BE NO REIMBURSEMENT TO THE GOVERNMENT FOR DAMAGES TO OR LOSS OF ITS OWN PROPERTY. 14 COMP. GEN. 256, 257. IN THOSE CASES WHERE THE RULE HAS BEEN APPLIED THERE ARE UNIFORMLY INVOLVED AGENCIES OR INSTRUMENTALITIES OF THE UNITED STATES PERFORMING GOVERNMENTAL FUNCTIONS WITH FEDERAL FUNDS, AND REPLACEMENT OF THE LOSS OR REPAIR OF THE DAMAGE INCURRED WAS REQUIRED TO BE EFFECTED WITH FEDERAL FUNDS. THE QUESTION GENERALLY INVOLVED WAS WHICH GOVERNMENT AGENCY'S FUNDS WERE AVAILABLE TO MEET THE REQUIRED COSTS. BUT HERE, WHILE TITLE TO AND CONTROL OF THE SAN CARLOS PROJECT REMAINS VESTED IN THE UNITED STATES AND THE PROJECT IS A GOVERNMENT INSTRUMENTALITY IT IS CLEAR THAT THE ONLY FUNDS AVAILABLE FOR REPAIR OF THE DAMAGE CAUSED TO THE PROJECT ARE FUNDS OF THE PROJECT BENEFICIARIES HELD IN TRUST FOR THEM BY THE GOVERNMENT. AND, AS STATED BY THE ASSISTANT SECRETARY, IT IS THEY RATHER THAN THE GOVERNMENT WHO ARE BEARING THE INSTANT LOSS.

ACCORDINGLY, BUT WITHOUT CONSIDERING THE QUESTION OF WHETHER THE DEPARTMENT OF THE AIR FORCE IS LIABLE FOR THE DAMAGE CAUSED BY THE CIVIL AIR PATROL IN THIS INSTANCE, YOUR DEPARTMENT'S CLAIM AGAINST THE DEPARTMENT OF THE AIR FORCE ON BEHALF OF THE SAN CARLOS IRRIGATION PROJECT IS NOT, IN OUR OPINION, PRECLUDED BY OPERATION OF THE RULE PROHIBITING CLAIMS BY ONE GOVERNMENT AGENCY AGAINST ANOTHER.

HOWEVER, PARAGRAPH 2.C OF AIR FORCE REGULATION 112-2, DATED MARCH 26, 1959, ESTABLISHING THE DISPOSITION PROCEDURE FOR EACH TYPE OF CLAIM RESULTING FROM ACCIDENTS AND INCIDENTS ARISING OUT OF AIR FORCE ACTIVITIES EXCLUDES THE UNITED STATES GOVERNMENT OR ANY OF ITS INSTRUMENTALITIES FROM CONSIDERATION AS A PROPER CLAIMANT FOR DAMAGES UNDER THE VARIOUS STATUTES IMPLEMENTED. THERE IS NO QUESTION BUT THAT THE SAN CARLOS PROJECT IS A UNITED STATES GOVERNMENT INSTRUMENTALITY AND THAT AS SUCH IT FALLS WITHIN THE LITERAL TERMS OF THE CITED REGULATIONS EXCLUDING IT FROM CONSIDERATION AS A PROPER CLAIMANT. AND SINCE THE ONLY STATUTES UNDER WHICH THE PROJECT CLAIM MIGHT BE COMPENSABLE--- 10 U.S.C. 2733, PROPERTY LOSS INCIDENT TO NONCOMBAT ACTIVITIES, AND 28 U.S.C. 2671, ET SEQ., FEDERAL TORT CLAIMS PROCEDURE- - PROVIDE FOR THE CONCLUSIVENESS OF CLAIMS SETTLED THEREUNDER BY THE HEADS OF THE DEPARTMENTS OR AGENCIES INVOLVED AND DO NOT CONFER ANY JURISDICTION IN THIS OFFICE OVER TORT CLAIMS ARISING IN ANY OTHER FEDERAL AGENCY, WE ARE WITHOUT AUTHORITY TO REQUIRE THE SECRETARY OF THE AIR FORCE TO CONSTRUE HIS REGULATION AS AUTHORIZING COGNIZANCE OF THE SUBJECT CLAIM. SEE 10 U.S.C. 2735, 28 U.S.C. 2672; AND 1 COMP. DEC. 283; 14 COMP. GEN. 855; UNITED STATES EX REL COATES V. ST. LOUIS CLAY PRODUCTS CO., 68 F.1SUPP. 902.

A COPY OF THIS LETTER IS BEING SENT TO THE SECRETARY OF THE AIR FORCE.