B-149865, OCT. 15, 1962

B-149865: Oct 15, 1962

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THE FACTS AND CIRCUMSTANCES GIVING RISE TO THE REQUEST ARE STATED IN THE LETTER AS FOLLOWS: "REGULATIONS OF THE INTERNAL REVENUE SERVICE PROVIDE FOR THE PAYMENT OF PER DIEM IN LIEU OF SUBSISTENCE EXPENSES AT RATES BASED ON THE LODGING COSTS INCURRED BY THE TRAVELER IN SUCH INSTANCE. THE BASIC AUTHORITY UNDER WHICH THE TRAVEL WAS PERFORMED WAS CONSOLIDATED TRAVEL AUTHORIZATION NO. 62. WHEN A TRAVELER IS ACCOMPANIED BY HIS WIFE. HE WILL PRESUMABLY BE CHARGED A HIGHER RATE FOR LODGING FOR THE TWO OF THEM THAN HE WOULD FOR HIMSELF ALONE. ITEM (A) PROVIDED THAT A TRAVELER WHO SHARED ACCOMMODATIONS WITH OTHERS IN A HOTEL OR MOTEL COULD CONSIDER HIS LODGING COST THE AMOUNT THAT HE WOULD HAVE HAD TO PAY FOR HIMSELF ALONE.

B-149865, OCT. 15, 1962

TO THE SECRETARY OF THE TREASURY:

BY LETTER OF SEPTEMBER 5, 1962, THE ADMINISTRATIVE ASSISTANT SECRETARY OF YOUR DEPARTMENT REQUESTED OUR DECISION CONCERNING AMENDMENTS TO THE TREASURY DEPARTMENT (INTERNAL REVENUE SERVICE) TRAVEL REGULATIONS.

THE FACTS AND CIRCUMSTANCES GIVING RISE TO THE REQUEST ARE STATED IN THE LETTER AS FOLLOWS:

"REGULATIONS OF THE INTERNAL REVENUE SERVICE PROVIDE FOR THE PAYMENT OF PER DIEM IN LIEU OF SUBSISTENCE EXPENSES AT RATES BASED ON THE LODGING COSTS INCURRED BY THE TRAVELER IN SUCH INSTANCE. SECTION 3 (B) OF INTERNAL REVENUE MANUAL SUPPLEMENT NO. 170-59, DATED SEPTEMBER 29, 1961, PRESCRIBED THE PER DIEM RATES IN EFFECT THROUGH THE MONTHS OF APRIL AND MAY 1962. THE BASIC AUTHORITY UNDER WHICH THE TRAVEL WAS PERFORMED WAS CONSOLIDATED TRAVEL AUTHORIZATION NO. 62, DATED MAY 31, 1961.

"THE METHOD OF FIXING PER DIEM RATES OCCASIONALLY NECESSITATES A DETERMINATION AS TO THE AMOUNT THAT MAY BE ALLOWED AS LODING COST. FOR EXAMPLE, WHEN A TRAVELER IS ACCOMPANIED BY HIS WIFE, HE WILL PRESUMABLY BE CHARGED A HIGHER RATE FOR LODGING FOR THE TWO OF THEM THAN HE WOULD FOR HIMSELF ALONE, THUS REQUIRING THE APPROVING OFFICER TO DETERMINE WHAT PORTION OF THIS AMOUNT MAY BE ACCEPTED AS LODGING COST. IN AN ATTEMPT TO STANDARDIZE SUCH DETERMINATIONS, THE INTERNAL REVENUE SERVICE ISSUED MANUAL SUPPLEMENT 170-59, AMENDMENT 2, DATED APRIL 10, 1962. SUBSECTION 3.01 OF THIS REGULATION, ITEM (A) PROVIDED THAT A TRAVELER WHO SHARED ACCOMMODATIONS WITH OTHERS IN A HOTEL OR MOTEL COULD CONSIDER HIS LODGING COST THE AMOUNT THAT HE WOULD HAVE HAD TO PAY FOR HIMSELF ALONE, AND ITEM (B) PROVIDED THAT AN EMPLOYEE WHO SHARES ACCOMMODATIONS IN QUARTERS OTHER THAN HOTEL OR MOTEL WOULD USE HIS PRO-RATA SHARE OF THE TOTAL COST OF SUCH LODGING AS HIS LODGING COST FOR THE PURPOSE OF DETERMINING HIS PER DIEM RATE.

"SHORTLY AFTER ISSUANCE OF THIS REGULATION, IT BECAME APPARENT THAT THE PROVISIONS OF ITEMS (A) AND (B) WERE NOT CONSISTENT AND THAT THE APPLICATION OF ITEM (B) HAD THE EFFECT OR PENALIZING A NUMBER OF EMPLOYEES IN AN EXTENDED TRAVEL STATUS WHO WERE ACCOMPANIED BY THEIR FAMILIES AND WERE RENTING APARTMENTS ON A TEMPORARY BASIS. FOR EXAMPLE, ONE EMPLOYEE ON AN EXTENDED INVESTIGATIVE ASSIGNMENT RENTED AN APARTMENT FOR $189.20 PER MONTH. SINCE THIS WAS IN EXCESS OF $6.00 PER DAY, HIS PER DIEM REIMBURSEMENT UP UNTIL THE ISSUANCE OF THE CITED REGULATION WAS $13.00 PER DAY. SINCE THE EMPLOYEE IN QUESTION WAS ACCOMPANIED BY HIS WIFE, THE EFFECT OF THE REGULATION WAS TO REDUCE HIS PER DIEM REIMBURSEMENT TO $11.00. THE INEQUITABILITY OF THIS TREATMENT IS BORNE OUT BY THE FACT THAT, HAD HE NOT BEEN ACCOMPANIED BY HIS WIFE, HE WOULD HAVE USED A HOTEL ROOM WHICH WOULD HAVE RESULTED IN A PER DIEM REIMBURSEMENT OF $14.00.

"AS SOON AS THE INEQUITIES IN THE REGULATION WERE BROUGHT TO THE ATTENTION OF THE IRS OFFICIALS RESPONSIBLE FOR THEIR ISSUANCE, A TELEGRAM WAS DISPATCHED AMENDING THE REGULATIONS TO PROVIDE THAT THE AMOUNT USED BY A TRAVELER AS LODGING COST FOR PER DIEM COMPUTATION PURPOSES SHALL BE THE DAILY COST FOR THE ACCOMMODATIONS ACTUALLY USED, NOT TO EXCEED THE RATE FOR A SINGLE HOTEL OR MOTEL ROOM OF THE CLASS GENERALLY OCCUPIED BY GOVERNMENT TRAVELERS AT THE LOCATION INVOLVED. THIS AMENDMENT WAS MADE EFFECTIVE MAY 18, 1962, THE DATE OF THE TELEGRAM, SINCE THERE WAS SOME QUESTION AS TO THE AUTHORITY FOR RETROACTIVE REVISION OF THE REGULATIONS AS THIS MIGHT BE CONSIDERED A RETROACTIVE CHANGE IN PER DIEM RATES, WITHIN THE MEANING OF THE DECISION AT 23 CG 713. WE DO NOT VIEW THIS SITUATION AS A TRUE CHANGE IN PER DIEM RATES, BUT RATHER AS AN INTERPRETATION OF SERVICE REGULATIONS RELATED TO THE METHOD OF DETERMINING PER DIEM RATES, SO THAT THE DECISION NEED NOT BE APPLIED IN THIS CASE.

"WE WOULD LIKE TO MAKE THE AMENDMENT OF MAY 18, 1962, RETROACTIVE TO APRIL 1, 1962, THE EFFECTIVE DATE OF THE ORIGINAL INTERPRETATION. YOUR APPROVAL OF THIS ACTION IS REQUESTED.

"IN THE EVENT THAT YOU DETERMINE THAT THE PROVISIONS OF MANUAL SUPPLEMENT 17G-59, AMENDMENT 2, MAY NOT BE REVISED RETROACTIVELY, YOUR ADVICE IS REQUESTED AS TO WHETHER THESE PROVISIONS MUST BE APPLIED FOR THE PERIOD APRIL 1 TO APRIL 10, 1962. THIS QUESTION IS RAISED SINCE THE MANUAL SUPPLEMENT, BEARING AN EFFECTIVE DATE OF APRIL 1, WAS NOT ACTUALLY ISSUED UNTIL APRIL 10, 1962.'

APPARENTLY THE PROVISIONS OF THE REGULATIONS WHICH WERE AMENDED EFFECTIVE MAY 18, 1962, WERE VALID, CLEAR AND COMPLETE. THEREFORE, THE AMENDMENT WAS NOT ISSUED FOR THE PURPOSE OF CORRECTING AN OBVIOUS ERROR OR TO INCLUDE A PROVISION INADVERTENTLY OMITTED OR TO EXCLUDE A PROVISION INTENDED TO BE INCLUDED, BUT WAS FOR THE PURPOSE OF ELIMINATING THE OCCASIONAL INEQUITIES REVEALED IN THE APPLICATION THEREOF. LIKEWISE, THE PURPOSE OF YOUR PROPOSAL TO MAKE THE AMENDMENT RETROACTIVELY EFFECTIVE IS TO ENABLE AN ADJUSTMENT IN THE PER DIEM RATES FOR TEMPORARY DUTY PERFORMED PRIOR TO MAY 18, 1962, IN THOSE CASES IN WHICH THE RATES ALLOWED ARE CONSIDERED TO HAVE BEEN INEQUITABLE. HENCE, APART FROM THE DECISION (23 COMP. GEN. 713) CITED BY YOU AND WHICH PERTAINED TO THE MODIFICATION OF INDIVIDUAL TRAVEL ORDERS THERE IS FOR APPLICATION HERE THE WELL SETTLED RULE THAT WHEN REGULATIONS ARE PROPERLY ISSUED, RIGHTS THEREUNDER BECOME FIXED AND ALTHOUGH SUCH REGULATIONS MAY BE AMENDED PROSPECTIVELY TO INCREASE OR DECREASE RIGHTS GIVEN THEREBY, THEY MAY NOT BE SO AMENDED RETROACTIVELY EXCEPT TO CORRECT OBVIOUS ERRORS. SEE 27 COMP. GEN. 339; 32 ID. 315; 33 ID. 505, AND 40 ID, 242. THEREFORE, YOUR FIRST QUESTION IS ANSWERED IN THE NEGATIVE.

CONCERNING YOUR SECOND QUESTION, WE ASSUME THAT NO ADVANCE AMENDMENT OF THE REGULATIONS OCCURRED PRIOR TO APRIL 10, 1962, SUCH AS WERE DONE WITH RESPECT TO THE AMENDMENT EFFECTIVE MAY 18, 1962. THEREFORE, AND AS SUCH AMENDMENT OF APRIL 10, 1962, HAD THE EFFECT OF DECREASING PER DIEM RATES IN CERTAIN INSTANCES IT MAY NOT BE REGARDED AS EFFECTIVE ON ANY DATE PRIOR TO APRIL 10, 1962. YOUR SECOND QUESTION IS ANSWERED ACCORDINGLY.