B-151311, MAY 28, 1963, 42 COMP. GEN. 659

B-151311: May 28, 1963

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A PROPOSED BILLING CHANGE TO PROVIDE FOR THE ADVANCE PAYMENT OF LOCAL TELEPHONE SERVICE MAY NOT BE APPROVED ON THE BASIS THAT EXCEPTIONS HAVE BEEN RECOGNIZED TO THE ADVANCE PAYMENT PROHIBITION IN 31 U.S.C. 529. FROM THE TELEPHONE COMPANY INDICATING THAT TELEPHONE SERVICE IS BILLED TWICE EACH MONTH WITH LOCAL SERVICE BEING BILLED IN ADVANCE OF THE DATE OF THE BILL AND TOLL SERVICE IN ARREARS OF SUCH DATE. DEC. 885 HOLDING THAT PAYMENT FOR TELEPHONE SERVICE IN ADVANCE WAS NOT PERMISSIBLE AND REFER TO COURT HOLDINGS TO THE EFFECT THAT A STATUTE NEED NOT BE INTERPRETED ACCORDING TO ITS STRICT LETTER WHEN TO DO SO WOULD ACHIEVE A RESULT CONTRARY TO ITS EVIDENT PURPOSE AND LEGISLATIVE INTENT. YOU CITE SEVERAL DECISIONS OF THIS OFFICE WHEREIN WE HAVE RECOGNIZED EXCEPTIONS TO THE GENERAL PROHIBITION.

B-151311, MAY 28, 1963, 42 COMP. GEN. 659

PAYMENTS - ADVANCE - PUBLIC UTILITIES, ETC. A PROPOSED BILLING CHANGE TO PROVIDE FOR THE ADVANCE PAYMENT OF LOCAL TELEPHONE SERVICE MAY NOT BE APPROVED ON THE BASIS THAT EXCEPTIONS HAVE BEEN RECOGNIZED TO THE ADVANCE PAYMENT PROHIBITION IN 31 U.S.C. 529, EXCEPTIONS TO THE PROHIBITION HAVING BEEN EXTENDED ONLY WHEN PROVIDED FOR IN EITHER LEGISLATIVE OR APPROPRIATIONS ACTS, AND FOR STATE OR LOCAL GOVERNMENTS BECAUSE OF THEIR ESTABLISHED FINANCIAL RESPONSIBILITY, BUT NOT FOR ANY OTHER GROUP, INCLUDING THOSE RENDERING PUBLIC UTILITY SERVICES; THEREFORE, THE BILLING OF THE GOVERNMENT ON DIFFERENT TERMS THAN THOSE OF OTHER TELEPHONE SUBSCRIBERS PRESENTING NO UNSURMOUNTABLE PROBLEMS WITH TELEPHONE COMPANIES GENERALLY, NO PARTICULAR ACCOUNTING ADVANTAGE CAN BE PERCEIVED TO THE PROPOSED BILLING CHANGE AND THE LOCAL TELEPHONE BILLS SHOULD CONTINUE TO BE PAID AFTER THE RENDITION OF THE SERVICE.

TO THE POSTMASTER GENERAL, MAY 28, 1963:

YOUR LETTER OF APRIL 16, 1963, PRESENTED FOR OUR CONSIDERATION A QUESTION CONCERNING SECTION 3648, R.S., 31 U.S.C. 529, WHICH GENERALLY PROHIBITS THE PAYMENT IN ADVANCE OF PUBLIC MONEY UNLESS AUTHORIZED BY THE APPROPRIATION CONCERNED OR OTHER LAW.

THE SPECIFIC CASE INVOLVES TELEPHONE SERVICE RENDERED TO THE ROCK HILL, SOUTH CAROLINA POST OFFICE BY THE ROCK HILL TELEPHONE COMPANY. YOU STATE THAT THE TELEPHONE COMPANY HAS REQUESTED THAT YOUR DEPARTMENT AGREE TO PAY FOR SERVICE ON THE SAME BASIS AS OTHER SUBSCRIBERS, NAMELY ON A CURRENT BASIS. YOU ENCLOSE A LETTER DATED APRIL 3, 1963, FROM THE TELEPHONE COMPANY INDICATING THAT TELEPHONE SERVICE IS BILLED TWICE EACH MONTH WITH LOCAL SERVICE BEING BILLED IN ADVANCE OF THE DATE OF THE BILL AND TOLL SERVICE IN ARREARS OF SUCH DATE.

YOU CITE THE CASE IN 27 COMP. DEC. 885 HOLDING THAT PAYMENT FOR TELEPHONE SERVICE IN ADVANCE WAS NOT PERMISSIBLE AND REFER TO COURT HOLDINGS TO THE EFFECT THAT A STATUTE NEED NOT BE INTERPRETED ACCORDING TO ITS STRICT LETTER WHEN TO DO SO WOULD ACHIEVE A RESULT CONTRARY TO ITS EVIDENT PURPOSE AND LEGISLATIVE INTENT. ALSO, YOU CITE SEVERAL DECISIONS OF THIS OFFICE WHEREIN WE HAVE RECOGNIZED EXCEPTIONS TO THE GENERAL PROHIBITION. YOU STATE THAT ON THE BASIS OF THE ABOVE-CITED RULE OF STATUTORY CONSTRUCTION PAYMENT OF TELEPHONE BILLS ON A CURRENT BASIS WHEN CUSTOMARILY SO RENDERED WOULD BE CONSISTENT WITH OUR DECISIONS PERMITTING EXCEPTIONS TO THE GENERAL RULE AND WOULD BE DESIRABLE FROM AN ACCOUNTING STANDPOINT. OUR DECISION IS REQUESTED AS TO WHETHER PAYMENTS FOR LOCAL TELEPHONE SERVICE MAY BE MADE IN ADVANCE OF THE RENDITION OF THE SERVICE.

THE STATUTE IN QUESTION PROVIDES IN PERTINENT PART AS FOLLOWS:

NO ADVANCE OF PUBLIC MONEY SHALL BE MADE IN ANY CASE UNLESS AUTHORIZED BY THE APPROPRIATION CONCERNED OR OTHER LAW. * * *.

EXCEPTIONS TO THIS BASIC PROHIBITION HAVE BEEN MADE BOTH IN LEGISLATIVE AND APPROPRIATION ACTS. ALSO, THIS OFFICE HAS HELD IN THE DECISIONS CITED BY YOU, PARTICULARLY IN B-140857 APPEARING IN 39 COMP. GEN. 285, THAT THE PROHIBITION NEED NOT BE APPLIED IN THE CASE OF PAYMENTS TO STATE AND LOCAL GOVERNMENTS. THE BASIS FOR THE RECOGNITION OF EXCEPTIONS TO THE GENERAL PROHIBITION AGAINST ADVANCE PAYMENTS WAS THAT THE DANGER OF FINANCIAL LOSS FROM THE FAILURE TO RENDER SERVICES OR FURNISH SUPPLIES PAID FOR IN ADVANCE WAS MINIMIZED WHERE STATE OR LOCAL GOVERNMENTS ARE INVOLVED BECAUSE OF THEIR ESTABLISHED FINANCIAL RESPONSIBILITY. EXCEPTIONS TO THE PROHIBITION IN THE LAW HAVE NOT BEEN EXTENDED BY THIS OFFICE TO ANY OTHER GROUP, INCLUDING THOSE RENDERING PUBLIC UTILITY SERVICES TO THE GOVERNMENT. THE RULING LAID DOWN IN 27 COMP. DEC. 885 WITH RESPECT TO THE ADVANCE PAYMENT OF TELEPHONE SERVICE HAS BEEN FOLLOWED BY OTHER DEPARTMENTS AND AGENCIES APPARENTLY WITHOUT DIFFICULTY. THE BILLING OF THE GOVERNMENT ON DIFFERENT TERMS THAN THOSE OF OTHER TELEPHONE SUBSCRIBERS HAS NOT TO DATE PRESENTED ANY UNSURMOUNTABLE PROBLEMS WITH TELEPHONE COMPANIES GENERALLY AND NO PARTICULAR ACCOUNTING ADVANTAGE CAN BE PERCEIVED TO THE PROPOSED BILLING CHANGE.

SINCE NO EXCEPTION TO THE PROHIBITIONS HAVE BEEN EXTENDED TO THE POST OFFICE DEPARTMENT EITHER IN LEGISLATIVE ENACTMENTS OR APPROPRIATION ACTS AND SINCE NO COMPELLING REASONS HAVE BEEN ADVANCED AS TO ANY ADVANTAGE TO THE GOVERNMENT, TELEPHONE BILLS OF THE ROCK HILL TELEPHONE COMPANY SHOULD BE PAID AFTER RENDITION OF THE SERVICE AS HERETOFORE.