B-150574, MAY 28, 1963, 42 COMP. GEN. 655

B-150574: May 28, 1963

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FOREIGN GOVERNMENTS - MUNICIPALITIES - SERVICE CHARGES AN AGREEMENT BETWEEN THE STATE DEPARTMENT AND THE FEDERAL REPUBLIC OF GERMANY TO PROVIDE FOR THE PROSPECTIVE PAYMENT OF THE COST OF CLEANING MUNICIPAL STREETS ADJACENT TO PROPERTY OCCUPIED BY UNITED STATES FORCES AND IMPOSED BY MUNICIPALITIES ON ALL OWNERS AND OCCUPIERS OF PROPERTY IS NOT PRECLUDED UNDER THE PROVISIONS OF THE BONN CONVENTIONS EXEMPTING THE UNITED STATES FROM PAYMENT OF TAXES AND PROVIDING FOR THE FREE USE OF THOSE FACILITIES AND SERVICES ENJOYED BY RESIDENTS WITHOUT CHARGE IN VIEW OF THE STATE DEPARTMENT CONSTRUCTION THAT THE TERMS OF THE TREATY DO NOT EXEMPT THE FORCES FROM THE PAYMENT OF THE STREET CLEANING CHARGES ASSESSED BY POLITICAL SUBDIVISIONS OF THE FEDERAL REPUBLIC OF GERMANY.

B-150574, MAY 28, 1963, 42 COMP. GEN. 655

FOREIGN GOVERNMENTS - MUNICIPALITIES - SERVICE CHARGES AN AGREEMENT BETWEEN THE STATE DEPARTMENT AND THE FEDERAL REPUBLIC OF GERMANY TO PROVIDE FOR THE PROSPECTIVE PAYMENT OF THE COST OF CLEANING MUNICIPAL STREETS ADJACENT TO PROPERTY OCCUPIED BY UNITED STATES FORCES AND IMPOSED BY MUNICIPALITIES ON ALL OWNERS AND OCCUPIERS OF PROPERTY IS NOT PRECLUDED UNDER THE PROVISIONS OF THE BONN CONVENTIONS EXEMPTING THE UNITED STATES FROM PAYMENT OF TAXES AND PROVIDING FOR THE FREE USE OF THOSE FACILITIES AND SERVICES ENJOYED BY RESIDENTS WITHOUT CHARGE IN VIEW OF THE STATE DEPARTMENT CONSTRUCTION THAT THE TERMS OF THE TREATY DO NOT EXEMPT THE FORCES FROM THE PAYMENT OF THE STREET CLEANING CHARGES ASSESSED BY POLITICAL SUBDIVISIONS OF THE FEDERAL REPUBLIC OF GERMANY.

TO MAJOR L. L. PERSONS, DEPARTMENT OF THE ARMY, MAY 28, 1963:

BY FIRST INDORSEMENT DATED DECEMBER 31, 1962, AND LETTER OF JANUARY 7, 1963, FROM THE FINANCE CENTER, UNITED STATES ARMY, YOUR LETTER OF DECEMBER 17, 1962, WITH ATTACHMENTS, REQUESTING AN ADVANCE DECISION AS TO THE PROPRIETY OF PAYMENT OF AN ATTACHED VOUCHER UNDER THE CIRCUMSTANCES HEREINAFTER DESCRIBED WAS FORWARDED HERE FOR CONSIDERATION. THE VOUCHER IN THE AMOUNT OF $156.61 IS DATED DECEMBER 17, 1962, AND IS STATED IN FAVOR OF THE MAGISTRAT DER STADT DARMSTADT, GERMANY, FOR PAYMENT FOR STREET CLEANING FOR THE PERIOD JULY 1 TO SEPTEMBER 30, 1962.

IT IS STATED IN THE ATTACHMENTS THAT ACCORDING TO GERMAN LAND (STATE) STATUTORY OR CUSTOMARY LAW, SIDEWALK MAINTENANCE AND STREET CLEANING ARE THE RESPONSIBILITY OF MUNICIPALITIES. MOST OF THE MUNICIPALITIES THROUGHOUT THE FEDERAL REPUBLIC OF GERMANY (FRG) REQUIRE PROPERTY OWNERS AND OCCUPIERS TO CLEAN THE MUNICIPAL STREETS AND SIDEWALKS ADJOINING THEIR PROPERTY. STREET CLEANING CONSISTS OF SWEEPING, SNOW REMOVAL AND WASHING OR SPRINKLING. MOST OF THE LARGER MUNICIPALITIES ASSUME THE STREET CLEANING OBLIGATIONS OF THE PROPERTY OWNERS AND OCCUPIERS AND, IN ORDER TO PARTIALLY OR WHOLLY DEFRAY THE COST OF THE STREET CLEANING SERVICE, ASSESS A CHARGE AGAINST THE OWNER OR OCCUPIER OF THE PROPERTY. THE AMOUNT OF EACH ASSESSMENT IS NORMALLY BASED UPON THE FRONTAGE OF THE PROPERTY ON THE MUNICIPAL STREET. THE ASSESSMENTS ARE IMPOSED AGAINST EACH OWNER OR OCCUPIER REGARDLESS OF WHETHER THE OWNER OR OCCUPIER IS A PRIVATE PERSON OR COMPANY, THE FEDERAL GOVERNMENT, A LAND (STATE) GOVERNMENT, OR EVEN THE MUNICIPALITY ITSELF.

IT IS FURTHER STATED THAT DURING THE OCCUPATION PERIOD (1945 TO MAY 5, 1955), THE UNITED STATES OCCUPATION FORCES PAID THE STREET CLEANING CHARGES ON THE GERMAN GOVERNMENTAL PROPERTIES OCCUPIED BY THEM. (ALTHOUGH THE RULES OF INTERNATIONAL LAW RELIEVE THE OCCUPYING POWER OF AN ENEMY NATION FROM THE PAYMENT OF RENT ON GOVERNMENTALLY OWNED PROPERTIES USED AND OCCUPIED BY IT, VARIOUS CHARGES ON THE PROPERTY, INCLUDING STREET CLEANING CHARGES, MUST BE PAID BY THE OCCUPYING POWER.) WHEN THE FEDERAL REPUBLIC OF GERMANY GAINED ITS SOVEREIGNTY (MAY 5, 1955), HOWEVER, THE UNITED STATES FORCES REFUSED TO PAY VARIOUS CHARGES (INCLUDING STREET CLEANING AND REPAIR AND MAINTENANCE OF ADJOINING STREETS) ASSESSED AGAINST IT AS A RESULT OF THE OCCUPANCY AND USE OF THE GERMAN GOVERNMENTAL PROPERTIES, ON THE GROUND THAT THE BONN CONVENTIONS RELIEVED THEM FROM THE PAYMENT OF CHARGES. AS THE MATTER COULD NOT BE SETTLED AT OPERATING LEVEL, IT WAS SUBMITTED TO THE DEPARTMENTS OF STATE AND DEFENSE FOR RESOLUTION. BY JOINT MESSAGE THE TWO DEPARTMENTS AUTHORIZED THE AMERICAN EMBASSY, BONN, TO NEGOTIATE A SETTLEMENT OF THE STREET CLEANING AND SIDEWALK MAINTENANCE CLAIMS ON THE BASIS THAT THE UNITED STATES FORCES WOULD PAY STREET CLEANING CHARGES IF THE FRG WOULD DROP SIDEWALK MAINTENANCE CHARGES. PURSUANT TO THIS AUTHORITY THE AMERICAN EMBASSY ENTERED INTO AN AGREEMENT ON THE TERMS AUTHORIZED, WITH THE ADDITIONAL PROVISION THAT IN CONSIDERATION OF THE UNITED STATES FORCES ASSUMING THE COST OF STREET CLEANING, THE FEDERAL REPUBLIC WOULD RELINQUISH CERTAIN BENEFITS OTHERWISE DUE IT UNDER THE BONN CONVENTIONS.

IT APPEARS THAT THE FRG PAID THE STREET CLEANING CHARGES DURING THE PERIOD THE MATTER WAS IN DISPUTE (MAY 5, 1955, TO JUNE 30, 1962)BECAUSE THE PAYMENT OF THE CHARGES COULD HAVE BEEN ENFORCED THROUGH THE SALE OF THE PROPERTY. THE FRG PAID THE CHARGES FROM THE DATE OF SETTLEMENT UNTIL JANUARY 1, 1962, IN ORDER TO PERMIT THE UNITED STATES FORCES TO DEVELOP PROCEDURES FOR PAYMENT OF THE CHARGES. SINCE JANUARY 1, 1962, THE MUNICIPALITIES HAVE BEEN BILLING THE UNITED STATES FORCES DIRECTLY.

IT IS ALSO STATED THAT THE CITY OF DARMSTADT'S MUNICIPAL ORDINANCES CONCERNING STREET CLEANING ARE SIMILAR TO THOSE THROUGHOUT THE FRG. THE OBLIGATION TO CLEAR STREETS IS PLACED UPON THE OWNERS ("OWNERS" IN THE SENSE USED IN THE ORDINANCE INCLUDES LESSEES AND OTHER USUFRUCTUARIES) OF THE PROPERTY ADJOINING MUNICIPAL STREETS. THE CITY HAS ASSUMED THE OBLIGATION OF THE OWNERS TO CLEAN THE STREETS AND CHARGES A FEE FOR THE CLEANING SERVICE. THE CHARGES ARE ASSESSED ON A RECURRING BASIS. ALL PROPERTY OWNERS AS DEFINED IN SENTENCE TWO OF THIS PARAGRAPH, ARE REQUIRED TO ACCEPT THE SERVICE AND PAY THE CHARGES.

YOU RAISE THE FOLLOWING QUESTIONS:

A. WOULD PAYMENT OF THIS VOUCHER BE INCONSISTENT WITH ARTICLE 1 OF THE AGREEMENT ON TAX TREATMENT OF THE FORCES AND ITS MEMBERS AS REFLECTED IN THE TEXT OF THE BONN CONVENTION (INCLOSURE 2) WHICH STATES IN PART,"THE FORCE SHALL BE EXEMPT FROM TAXES WHICH ARE LEVIED IN ACCORDANCE WITH GERMAN TAX LEGISLATION IN EFFECT ON THE ENTRY INTO FORCE OF THE PRESENT AGREEMENT EXCEPT AS OTHERWISE PROVIDED IN THE PRESENT AGREEMENT? " IN THIS CONNECTION NOTE THAT THE RATE (HEBESATZ) AT WHICH THE STREET CLEANING CHARGES ARE COMPUTED IS DERIVED FROM GERMAN TAX LEGISLATION (GRUNDSTEUERGESETZ VOM 10.8.1951).

B. WOULD PAYMENT OF THIS VOUCHER BE INCONSISTENT WITH ARTICLE 7, PAR 1 (B) OF THE FINANCE CONVENTION OF THE BONN CONVENTION (INCLOSURE 2) WHEREIN IT IS STATED THAT THE FOLLOWING TYPES OF FACILITIES AND SERVICES SHALL BE ENJOYED BY THE FORCES, FOR THEMSELVES AND FOR THEIR MEMBERS WITHOUT CHARGES: ". . . ROADS, HIGHWAYS, BRIDGES," OR WITH PAR 1 (D) OF THAT ARTICLE WHICH LISTS ,GERMAN POLICE, PUBLIC HEALTH AND FIRE PROTECTION SERVICES UNLESS AGREED TO BE OF SPECIAL CHARACTER WARRANTING PAYMENT," AND, IN THIS CONNECTION DOES THE JOINT STATE DEFENSE MESSAGE, A COPY WHICH IS AT INCLOSURE 3, AND ITS ATTACHED LETTER FROM THE 1ST SECRETARY OF THE BONN EMBASSY TO USAREUR ENGINEERS, CONSTITUTES AN AGREEMENT AS TO THE SPECIAL CHARACTER OF A PUBLIC HEALTH SERVICE WARRANTING PAYMENT BOTH RETROACTIVELY AND IN THE FUTURE IN ACCORDANCE WITH THE BONN CONVENTION?

C. WOULD PAYMENT OF THIS VOUCHER BE INCOMPATIBLE WITH COMP GEN DECISION B -105117, 19 FEBRUARY 1952 (31 COMP GEN 405) AND THE DICTUM EXPRESSED ON PAGE 603 OF COMP GEN DECISION B-47142, 7 FEBRUARY 1945 (24 COMP GEN. 599) AND WOULD PAYMENT FOR SIMILAR SERVICES BOTH RETROACTIVELY AND IN THE FUTURE VIOLATE THE ABOVE CITED COMP GEN DECISIONS? IN THIS CONNECTION NOTE THAT LTR HQ USAREUR, DATED 12 JUNE 1962 SUBJECT,"PAYMENT OF STREET CLEANING CHARGES IN GERMANY," (SUPPORTING PAPER TO INCL 1) INDICATES PAYMENTS TO MUNICIPALITIES FOR THIS SERVICE HAVE HERETOFORE BEEN MADE BY THE FEDERAL REPUBLIC OF GERMANY.

THE PROTOCOL ON THE TERMINATION OF THE OCCUPATION REGIME IN THE FEDERAL REPUBLIC OF GERMANY WAS SIGNED AT PARIS ON BEHALF OF THE UNITED STATES OF AMERICA, THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND, THE FRENCH REPUBLIC, AND THE FEDERAL REPUBLIC OF GERMANY. IT WAS RATIFIED BY THE SENATE OF THE UNITED STATES ON APRIL 1, 1955, AND ENTERED INTO FORCE ON MAY 5, 1955. SAID PROTOCOL AMENDED THE CONVENTION ON RELATIONS BETWEEN THE THREE POWERS AND THE FEDERAL REPUBLIC OF GERMANY, THE CONVENTION ON THE RIGHTS AND OBLIGATIONS OF FOREIGN FORCES AND THEIR MEMBERS IN THE FEDERAL REPUBLIC OF GERMANY, THE FINANCE CONVENTION, THE CONVENTION ON THE SETTLEMENT OF MATTERS ARISING OUT OF THE WAR AND THE OCCUPATION, SIGNED AT BONN, GERMANY, ON MAY 26, 1952, THE PROTOCOL SIGNED AT BONN ON JUNE 27, 1952, TO CORRECT CERTAIN TEXTUAL ERRORS IN THE AFOREMENTIONED CONVENTIONS, AND THE AGREEMENT ON THE TAX TREATMENT OF THE FORCES AND THEIR MEMBERS SIGNED AT BONN ON MAY 26, 1952, AS AMENDED BY THE PROTOCOL SIGNED AT BONN ON JULY 26, 1952, CONFERRING UPON THE ARBITRATION TRIBUNAL JURISDICTION OVER DISPUTES ARISING UNDER THAT AGREEMENT.

ARTICLE 1 OF THE AGREEMENT ON THE TAX TREATMENT OF THE FORCES AND THEIR MEMBERS READS, IN PART, AS FOLLOWS:

THE FORCES (WHICH EXPRESSION IN THIS AGREEMENT SHALL HAVE THE MEANING GIVEN IN PARAGRAPH 5 OF ARTICLE 1 OF THE CONVENTION ON THE RIGHTS OBLIGATIONS OF FOREIGN FORCES AND THEIR MEMBERS IN THE FEDERAL REPUBLIC OF GERMANY HEREINAFTER REFERRED TO AS THE "FORCES CONVENTION") SHALL BE EXEMPT FROM TAXES WHICH ARE LEVIED IN ACCORDANCE WITH GERMAN TAXATION LEGISLATION IN EFFECT ON THE ENTRY INTO FORCE OF THE PRESENT AGREEMENT, EXCEPT AS OTHERWISE PROVIDED IN THE PRESENT AGREEMENT.

ARTICLE 7, PARAGRAPH 1 OF THE FINANCE CONVENTION READS IN PART AS FOLLOWS:

1. THE FOLLOWING TYPES OF FACILITIES AND SERVICES SHALL BE USED OR ENJOYED BY THE FORCES, FOR THEMSELVES AND FOR THEIR MEMBERS, WITHOUT CHARGE:

(B) ROADS, HIGHWAYS, BRIDGES;

(D) GERMAN POLICE, PUBLIC HEALTH AND FIRE PROTECTION SERVICES, UNLESS AGREED TO BE OF A SPECIAL CHARACTER WARRANTING PAYMENT;

(E) OTHER PUBLIC SERVICES AND FACILITIES NORMALLY ENJOYED BY RESIDENTS OF THE FEDERAL TERRITORY WITHOUT PAYMENT OF A SPECIFIC CHARGE;

ARTICLE 7, PARAGRAPH 6 OF THE FINANCE CONVENTION READS AS FOLLOWS:

IN GENERAL THE COST OF THE CONSTRUCTION, REPAIR AND MAINTENANCE OF TRANSPORT AND COMMUNICATIONS FACILITIES, INSTALLATIONS AND EQUIPMENT, AND PUBLIC UTILITY FACILITIES, WHICH SERVE COMMON CIVILIAN AND MILITARY USE SHALL NOT BE CHARGED TO THE DEFENSE CONTRIBUTION OF THE FEDERAL REPUBLIC. WHERE, HOWEVER THESE FACILITIES ARE NOT REVENUE PRODUCING AND THE CIVIL USE IS SMALL OR WHERE THERE ARE ANY OTHER SPECIAL CIRCUMSTANCES WHICH JUSTIFY A DEPARTURE FROM THE GENERAL RULE, THE EXTRA COSTS ATTRIBUTABLE TO THE MILITARY REQUIREMENTS WILL BE PRIOR SPECIFIC AGREEMENTS BE SHARED OR BORNE, AS THE CASE MAY BE, BY THE FORCES.

THE JOINT STATE-DEFENSE MESSAGE DATED JUNE 30, 1961, REFERRED TO ABOVE READS IN PART AS OLLOWS:

RE STREET CLEANING CHARGES. BASIC INFO CONTAINED A-352 BELIEVE PRINCIPAL DIFFICULTY HAS BEEN LACK CLEAR IDEA WHAT "STREET CLEANING" AND "MAINTENANCE" CONSIST OF. ON ASSUMPTION STREET CLEANING IN CONTEXT OUTSTANDING CHARGES CONSISTS OF NORMAL CLEANING OF DIRT, PAPER, "MAINTENANCE" I.E., SNOW AND ICE REMOVAL, RUBBLE, ETC., WE AGREE THAT CONSTITUTES SERVICE OF PUBLIC HEALTH NATURE RATHER THAN MAINTENANCE UNDER PARA 6. AGREE CONCLUSION G-1047 THAT THIS CHARGE NOT INTENDED BE COVERED BY PARA 1 (D) OF ARTICLE 7.

AS A GENERAL PROPOSITION THE UNITED STATES IS REQUIRED TO PAY TAXES IMPOSED BY A FOREIGN STATE OR THE POLITICAL SUBDIVISIONS THEREOF UPON UNITED STATES ACTIVITIES, OPERATIONS, AND PROPERTY THEREIN, UNLESS OTHERWISE PROVIDED BY FORMAL AGREEMENT OR TREATY. THUS THE QUESTION ARISES AS TO WHETHER THE PROVISIONS OF THE BONN CONVENTIONS EXEMPT THE UNITED STATES FROM PAYING THE STREET CLEANING CHARGES IN QUESTION.

IT APPEARS THAT THE STATE DEPARTMENT HAS CONSTRUED ARTICLE 1 OF THE AGREEMENT ON THE TAX TREATMENT OF THE FORCES AS NOT PROVIDING AN EXEMPTION FOR THE STREET CLEANING CHARGES IMPOSED BY THE GERMAN CITIES. IT IS WELL ESTABLISHED THAT THE REASONABLE CONSTRUCTION OF THE TERMS OF A TREATY BY THE STATE DEPARTMENT, ACQUIESCED IN BY THE OTHER SIGNATORY POWERS IS ENTITLED TO GREAT WEIGHT. UNITED STATES V. USHI SHIROMA, 123 F.SUPP. 145 (D. HAWAII 1954); UNION OF SOVIET SOCIALIST REPUBLICS V. NATIONAL CITY BANK OF NEW YORK, 41 F.SUPP. 353 (S.D.N.Y. 1941). IN VIEW THEREOF AND UNDER THE CIRCUMSTANCES HERE INVOLVED WE SHALL NOT QUESTION STATE DEPARTMENT'S INTERPRETATION OF THE RELEVANT PROVISIONS OF THE FINANCE CONVENTION AS NOT EXEMPTING THE UNITED STATES FROM THE PAYMENT OF STREET CLEANING CHARGES IMPOSED BY POLITICAL SUBDIVISIONS OF THE FEDERAL REPUBLIC OF GERMANY. THEREFORE, WE CONCLUDE THAT THE PROVISIONS OF THE BONN CONVENTIONS WOULD NOT PRECLUDE THE PROPER MAKING OF A SEPARATE AGREEMENT THEREFOR.

ALSO, SUCH PAYMENT WOULD NOT BE IN CONTRAVENTION OF OUR DECISIONS REPORTED IN 31 COMP. GEN. 405 AND 24 COMP. GEN. 599. THE LATTER CASE INVOLVED A SITUATION WHERE A MUNICIPALITY WAS STATED TO HAVE THE LEGAL DUTY OF SUPPLYING THE SERVICES IN QUESTION, WHICH IS NOT THE SITUATION HERE. THE FORMER CASE INVOLVED THE QUESTION OF THE SOVEREIGN IMMUNITY OF THE UNITED STATES FROM STATE TAXATION, WHICH IS SIMILARLY NOT THE SITUATION HERE.

WE SHOULD LIKE TO ADD THAT SINCE THE FIRST INDORSEMENT TO YOUR LETTER INDICATES THAT THE AGREEMENT BETWEEN THE STATE DEPARTMENT AND THE FEDERAL REPUBLIC OF GERMANY PROVIDED FOR PROSPECTIVE AND NOT RETROACTIVE PAYMENTS AND SINCE THE ENCLOSED VOUCHER ALSO INDICATES THAT THE AGREEMENT IS PROSPECTIVE IN NATURE WE SHALL NOT COMMENT ON THE QUESTION OF THE PROPRIETY OF RETROACTIVE PAYMENTS THEREUNDER.

YOUR QUESTIONS ARE ANSWERED ACCORDINGLY. THE VOUCHER WHICH IS ENCLOSED HEREWITH PROPERLY MAY BE PAID, IF OTHERWISE CORRECT.