B-168011, OCT. 24, 1969

B-168011: Oct 24, 1969

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IS NOT ENTITLED TO REIMBURSEMENT OF LOAN EXPENSE FEE WITHIN MEANING OF SEC. 4.2D OF BUREAU OF BUDGET CIR. A 56 SINCE "LENDER'S LOAN ORIGINATION FEE" WAS REMOVED FROM LISTING OF REIMBURSABLE EXPENSES BY TRANSMITTAL MEMORANDUM NO. 5. BECAUSE REGULATIONS IN EFFECT AT TIME EXPENSES ARE INCURRED IS CONTROLLING DATE AND NOT DATE OF TRAVEL AUTHORIZATION AS CLAIMED. 1969 WAS NO LONGER AUTHORIZED. PROULX WAS AUTHORIZED TO TRAVEL FROM ALBUQUERQUE. HE ENTERED INTO A CONTRACT FOR THE PURCHASE OF A HOME AT HIS NEW DUTY STATION AND SETTLEMENT THEREON WAS MADE ON SEPTEMBER 4. IS SHOWN ON THE CLOSING STATEMENT IN THE REAL ESTATE TRANSACTION AS BEING EQUAL TO TWO PERCENT OF THE LOAN AMOUNT AND IS IDENTIFIED ON THE STATEMENT AS .

B-168011, OCT. 24, 1969

OFFICERS AND EMPLOYEES--TRANSFERS--RELOCATION EXPENSES--HOUSE PURCHASE- LOAN CHARGES EMPLOYEE WHO INCIDENT TO TRANSFER OF OFFICIAL STATION FROM ALBUQUERQUE, NEW MEXICO, TO PORTLAND, OREGON, ENTERED INTO CONTRACT TO PURCHASE HOME AT NEW DUTY STATION ON JULY 8, 1969, MAKING SETTLEMENT THEREON ON SEPT. 4, 1969, IS NOT ENTITLED TO REIMBURSEMENT OF LOAN EXPENSE FEE WITHIN MEANING OF SEC. 4.2D OF BUREAU OF BUDGET CIR. NO. A 56 SINCE "LENDER'S LOAN ORIGINATION FEE" WAS REMOVED FROM LISTING OF REIMBURSABLE EXPENSES BY TRANSMITTAL MEMORANDUM NO. 5, EFFECTIVE JUNE 26, 1969 AND, BECAUSE REGULATIONS IN EFFECT AT TIME EXPENSES ARE INCURRED IS CONTROLLING DATE AND NOT DATE OF TRAVEL AUTHORIZATION AS CLAIMED, REIMBURSEMENT OF EXPENSES INCURRED ON SEPT. 4, 1969 WAS NO LONGER AUTHORIZED. SEE 47 COMP. GEN. 582.

TO MR. J. E. PERRY:

THIS REFERS TO YOUR LETTER OF SEPTEMBER 25, 1969, WITH ENCLOSURES, REQUESTING A DECISION FROM OUR OFFICE AS TO THE PROPRIETY OF CERTIFYING FOR PAYMENT A RECLAIM VOUCHER IN FAVOR OF MR. DAVID P. PROULX FOR REIMBURSEMENT OF CERTAIN REAL ESTATE EXPENSES INCURRED IN CONNECTION WITH THE PURCHASE OF A RESIDENCE AT HIS NEW DUTY STATION INCIDENT TO HIS TRANSFER FROM ALBUQUERQUE, NEW MEXICO, TO PORTLAND, OREGON.

BY TRAVEL AUTHORIZATION DATED JUNE 9, 1969, MR. PROULX WAS AUTHORIZED TO TRAVEL FROM ALBUQUERQUE, NEW MEXICO, TO PORTLAND, OREGON, INCIDENT TO A PERMANENT CHANGE OF STATION. HE REPORTED TO HIS NEW DUTY STATION ON JULY 3, 1969. ON JULY 8, 1969, HE ENTERED INTO A CONTRACT FOR THE PURCHASE OF A HOME AT HIS NEW DUTY STATION AND SETTLEMENT THEREON WAS MADE ON SEPTEMBER 4, 1969.

THE AMOUNT OF THE VOUCHER, $470, IS SHOWN ON THE CLOSING STATEMENT IN THE REAL ESTATE TRANSACTION AS BEING EQUAL TO TWO PERCENT OF THE LOAN AMOUNT AND IS IDENTIFIED ON THE STATEMENT AS ,LOAN EXPENSE.' IN CONNECTION WITH THE SALE OF A RESIDENCE, THE COST OF A PERCENTAGE LOAN EXPENSE FEE IS CUSTOMARILY PAID BY THE PURCHASER. THIS FEE SOMETIMES REFERRED TO AS A "PLACEMENT FEE, COMMISSION LOAN FEE, CLOSING FEE, OR INITIAL SERVICE CHARGE" WAS REIMBURSABLE AS A FEE OR CHARGE SIMILAR TO LOAN APPLICATION OR LENDER'S LOAN ORIGINATION FEE WITHIN THE MEANING OF SECTION 4.2D OF BUREAU OF THE BUDGET CIRCULAR NO. A-56, REVISED OCTOBER 12, 1966. HOWEVER, WITH THE REVISION OF CIRCULAR NO. A-56 AS PROVIDED UNDER TRANSMITTAL MEMORANDUM NO. 5, EFFECTIVE JUNE 26, 1969, THIS ,"LENDER'S LOAN ORIGINATION FEE," WAS REMOVED FROM THE LISTING OF REIMBURSABLE EXPENSES UNDER SECTION 4.2D RELATING TO ALLOWANCE FOR EXPENSES INCURRED IN CONNECTION WITH RESIDENCE TRANSACTIONS.

YOU SAY THERE IS DOUBT AS TO WHAT DATE IS CONTROLLING INSOFAR AS APPLYING THE NEW REVISION OF THE REGULATIONS. THE EMPLOYEE CONTENDS THAT HE SHOULD BE ALLOWED REIMBURSEMENT OF THE LOAN ORIGINATION FEE ON THE BASIS THAT THE TRAVEL ORDER AUTHORIZING HIS TRANSFER OF OFFICIAL STATION WAS ISSUED ON JUNE 9, 1969, AND THAT THE REGULATIONS IN EFFECT AT THAT TIME SHOULD BE CONTROLLING RATHER THAN THE REVISED REGULATIONS EFFECTIVE JUNE 26, 1969.

WE HAVE NEVER REGARDED THE DATE OF A TRAVEL AUTHORIZATION AS FIXING IN ALL RESPECTS THE RIGHTS OF AN EMPLOYEE TO BENEFITS PROVIDED BY REGULATIONS THEN IN EFFECT. UNDER THE PROVISIONS OF PUBLIC LAW 89-516, NOW 5 U.S.C. 5724A, OUR VIEW HAS BEEN THAT THE DATE THE EXPENSES ARE INCURRED IS CONTROLLING IN MOST SITUATIONS. SEE 47 COMP. GEN. 582. HERE THE EXPENSES WERE INCURRED AT THE TIME OF SETTLEMENT ON SEPTEMBER 4, 1969. SINCE THE REGULATIONS IN EFFECT ON THAT DATE NO LONGER CONTAINED ANY PROVISION AUTHORIZING REIMBURSEMENT OF A LOAN ORIGINATION FEE, THE CLAIM MAY NOT BE ALLOWED.

THE FACT THAT MR. PROULX HAD NO KNOWLEDGE OF THE CHANGE IN REGULATIONS AS STATED BY HIM IS IMMATERIAL. THE REGULATIONS ISSUED ARE STATUTORY IN NATURE AND HAVE THE FORCE AND EFFECT OF LAW. THUS, HE IS CHARGEABLE WITH CONSTRUCTIVE NOTICE OF SUCH REGULATIONS AND ANY CHANGES THEREIN FROM THE DATE OF ISSUANCE THEREOF OR THE PROSPECTIVE DATE SPECIFIED BY THE BUREAU OF THE BUDGET.

THE VOUCHER WHICH IS RETURNED HEREWITH MAY NOT BE CERTIFIED FOR PAYMENT.