B-161637, JUL. 21, 1967

B-161637: Jul 21, 1967

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EMPLOYEES - TRANSFERS - PUBLIC LAW 89-516 - HOME SALE AND PURCHASE EXPENSES DECISION TO BUREAU OF RECLAMATION CERTIFYING OFFICER CONCERNING PROPRIETY OF REIMBURSING EMPLOYEES FOR COSTS IN CONNECTION WITH PURCHASE OF RESIDENCES UPON TRANSFER TO GRAND COULEE. (1) TITLE INSURANCE AND EXCISE TAX WHICH WERE COSTS CUSTOMARILY PAID BY SELLER CAN NOT BE REIMBURSED TO EMPLOYEE FOR PURCHASE OF HOME. (2) COSTS OF TITLE INSURANCE PROTECTION NOT IN OWNER'S TITLE POLICY OR TITLE RECORD WHICH WAS IN ADDITION TO THAT CUSTOMARILY FURNISHED MAY BE REGARDED AS REIMBURSABLE COST (3) CERTAIN REAL ESTATE COSTS EXCEPT FOR TITLE INSURANCE WHICH IS USUALLY FURNISHED BY THE SELLER IN THE AREA MAY BE CERTIFIED FOR PAYMENT TO EMPLOYEE.

B-161637, JUL. 21, 1967

EMPLOYEES - TRANSFERS - PUBLIC LAW 89-516 - HOME SALE AND PURCHASE EXPENSES DECISION TO BUREAU OF RECLAMATION CERTIFYING OFFICER CONCERNING PROPRIETY OF REIMBURSING EMPLOYEES FOR COSTS IN CONNECTION WITH PURCHASE OF RESIDENCES UPON TRANSFER TO GRAND COULEE. (1) TITLE INSURANCE AND EXCISE TAX WHICH WERE COSTS CUSTOMARILY PAID BY SELLER CAN NOT BE REIMBURSED TO EMPLOYEE FOR PURCHASE OF HOME. (2) COSTS OF TITLE INSURANCE PROTECTION NOT IN OWNER'S TITLE POLICY OR TITLE RECORD WHICH WAS IN ADDITION TO THAT CUSTOMARILY FURNISHED MAY BE REGARDED AS REIMBURSABLE COST (3) CERTAIN REAL ESTATE COSTS EXCEPT FOR TITLE INSURANCE WHICH IS USUALLY FURNISHED BY THE SELLER IN THE AREA MAY BE CERTIFIED FOR PAYMENT TO EMPLOYEE.

TO MRS. NEDRA A. BLACKWELL, AUTHORIZED CERTIFYING OFFICER, BUREAU OF RECLAMATION, UNITED STATES DEPARTMENT OF THE INTERIOR:

WE REFER TO YOUR LETTERS OF MAY 26 AND JUNE 30, 1967, YOUR REFERENCE 360, TRANSMITTING FOR OUR ADVANCE DECISION THE VOUCHERS OF THREE EMPLOYEES OF THE BUREAU OF RECLAMATION, DEPARTMENT OF THE INTERIOR, FOR REIMBURSEMENT OF CERTAIN COSTS THEY INCURRED IN PURCHASING RESIDENCES IN THE VICINITY OF THEIR NEW PERMANENT DUTY STATION AT COULEE DAM, WASHINGTON, UNDER THE AUTHORITY OF SECTION 23 (4) OF THE ADMINISTRATIVE EXPENSES ACT OF 1946, AS ADDED BY THE ACT OF JULY 21, 1966, PUB. L. 89-516, 80 STAT. 324, AND SECTION 4 OF BUREAU OF THE BUDGET CIRCULAR NO. A-56.

MR. EDWARD M. MAKOFF WAS TRANSFERRED FROM FORT SMITH, MONTANA, TO COULEE DAM IN JANUARY 1967. IN FEBRUARY 1967 HE ENTERED INTO A CONTRACT TO PURCHASE A RESIDENCE AT HIS NEW DUTY STATION. IN THAT CONTRACT HE AGREED TO SPLIT CERTAIN OF THE CLOSING COSTS WITH THE SELLER OF THE RESIDENCE. SECTION 4.2 OF CIRCULAR NO. A-56 WHICH ENUMERATES CERTAIN EXPENSES WHICH ARE REIMBURSABLE IN CONNECTION WITH THE SALE AND PURCHASE OF RESIDENCES CONTAINS THE RESTRICTION THAT COSTS ARE REIMBURSABLE ONLY IF CUSTOMARILY PAID BY THE SELLER AT THE LOCATION OF THE OLD STATION AND THE BUYER AT THE LOCATION OF THE NEW STATION. SEE SUBSECTIONS 4.2D AND G. IN ACCORDANCE WITH THE INFORMATION FURNISHED BY THE DIRECTOR OF THE FEDERAL HOUSING ADMINISTRATION OFFICE, SPOKANE, WASHINGTON, IN HIS LETTER TO YOU OF JUNE 21, 1967, THE AMOUNTS PAID BY MR. MAKOFF FOR TITLE INSURANCE AND EXCISE TAX WERE COSTS CUSTOMARILY PAID BY THE SELLER IN THAT AREA. ACCORDINGLY, THE COSTS WHICH MR. MAKOFF AGREED TO PAY FOR TITLE INSURANCE AND EXCISE TAX BUT WHICH, AS PURCHASER, HE WOULD NOT CUSTOMARILY HAVE PAID IN THE COULEE DAM AREA ARE NOT REIMBURSABLE. THE OTHER COSTS APPEAR PROPER FOR ALLOWANCE.

MR. JOSEPH L. GRAHAM WAS TRANSFERRED FROM FORT SMITH TO COULEE DAM IN FEBRUARY 1967. THE REAL ESTATE CONTRACT HE ENTERED INTO FOR THE PURCHASE OF A RESIDENCE AT HIS NEW STATION IN MARCH 1967 CONTAINED NO PROVISION WHICH REQUIRED HIM TO PAY COSTS CUSTOMARILY PAID BY THE SELLER IN THAT AREA. THE STATEMENT IN THE LETTER OF THE DIRECTOR, FEDERAL HOUSING ADMINISTRATION, SPOKANE, WASHINGTON, WITH REGARD TO MR. GRAHAM'S CLAIM IS TO THE EFFECT THAT ALL OF THE COSTS PAID BY HIM FOR WHICH HE CLAIMS REIMBURSEMENT WERE REASONABLE AND THAT SIMILAR COSTS ARE CUSTOMARILY PAID BY THE PURCHASER IN THAT AREA. IT IS NOTED THAT THE TITLE INSURANCE COST WHICH MR. GRAHAM PAID ($13.03) AND FOR WHICH HE CLAIMS REIMBURSEMENT IS IDENTIFIED AS THE COST OF TITLE INSURANCE PROTECTION IN ADDITION TO THAT CUSTOMARILY FURNISHED BY THE SELLER IN THAT AREA. FURTHERMORE, IT IS INDICATED THAT THE INSURANCE INVOLVED WAS NOT AN OWNER'S TITLE POLICY OR A RECORD TITLE POLICY, REIMBURSEMENT OF THE COST OF WHICH IS SPECIFICALLY PROHIBITED BY SECTION 4.2D OF CIRCULAR NO. A-56.

DETAILS OF THE TRANSFER OF MR. DOY V. WHITLOCK HAVE NOT BEEN FURNISHED, HOWEVER, HIS CLAIM IS FOR EXPENSES HE INCURRED IN THE PURCHASE OF A HOME IN THE COULEE DAM AREA IN MAY 1967. THE REAL ESTATE CONTRACT WHICH HE EXECUTED APPARENTLY DEPARTED FROM THE CUSTOM OF THE AREA IN THAT THE AGREED PRICE WAS TO BE "NET TO SELLER" AND IN THAT THE PROVISION OF THE FORM CONTRACT WHICH WOULD HAVE REQUIRED THE SELLER TO FURNISH TITLE INSURANCE WAS DELETED. AS INDICATED ABOVE, SECTION 4 OF CIRCULAR NO. A-56 AUTHORIZES REIMBURSEMENT OF EXPENSES SUCH AS THOSE HERE INVOLVED ONLY IF THEY ARE CUSTOMARILY PAID BY THE PURCHASER IN THE AREA IN QUESTION. SINCE THE FEDERAL HOUSING ADMINISTRATION HAS ADVISED THAT TITLE INSURANCE IS USUALLY FURNISHED BY THE SELLER IN THE AREA IN QUESTION, REIMBURSEMENT TO MR. WHITLOCK FOR THE COST THEREOF IS NOT AUTHORIZED. WE SEE NO OBJECTION TO THE OTHER REAL ESTATE COST ITEMS CLAIMED BY MR. WHITLOCK. SECTION 4.2D OF CIRCULAR NO. A-56.

THE VOUCHERS OF MESSRS. MAKOFF, GRAHAM AND WHITLOCK WHICH ARE RETURNED HEREWITH MAY BE CERTIFIED FOR PAYMENT IN ACCORDANCE WITH THE ABOVE IF OTHERWISE CORRECT.