B-168088, NOV. 5, 1969

B-168088: Nov 5, 1969

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1969 DISALLOWING ACTUAL COST OF SHIPMENT OF HOUSEHOLD GOODS INCIDENT TO EMPLOYEE'S TRANSFER FROM LONG ISLAND TO NEW JERSEY IS SUSTAINED SINCE TRANSPORTATION OF HOUSEHOLD GOODS WAS NOT AUTHORIZED ON ACTUAL EXPENSE BASIS AND REIMBURSEMENT IS LIMITED TO AMOUNT ALLOWABLE UNDER COMMUTED RATE SYSTEM. WHICH IS SYSTEM OF APPROXIMATION WHICH. DEPENDENT ON VARIABLES OF EACH SHIPMENT WILL SOMETIMES BE FAVORABLE TO EMPLOYEES AND UNDER OTHER CONDITIONS OPERATE SOMEWHAT TO HIS DISADVANTAGE. IN WHICH YOU WERE ALLOWED $578 REPRESENTING THE AMOUNT DUE COMPUTED UNDER THE COMMUTED RATE SYSTEM FOR THE TRANSPORTATION OF YOUR HOUSEHOLD GOODS FROM PATCHOGUE. PAYMENT ON A COMMUTED BASIS IS AN AUTHORIZED METHOD OF REIMBURSING CIVILIAN EMPLOYEES FOR THE COST OF TRANSPORTATION OF THEIR HOUSEHOLD EFFECTS INCIDENT TO A TRANSFER WITHIN THE CONTINENTAL UNITED STATES.

B-168088, NOV. 5, 1969

TRANSPORTATION--HOUSEHOLD EFFECTS--COMMUTATION--SYSTEM OF APPROXIMATION SETTLEMENT OF AUG. 27, 1969 DISALLOWING ACTUAL COST OF SHIPMENT OF HOUSEHOLD GOODS INCIDENT TO EMPLOYEE'S TRANSFER FROM LONG ISLAND TO NEW JERSEY IS SUSTAINED SINCE TRANSPORTATION OF HOUSEHOLD GOODS WAS NOT AUTHORIZED ON ACTUAL EXPENSE BASIS AND REIMBURSEMENT IS LIMITED TO AMOUNT ALLOWABLE UNDER COMMUTED RATE SYSTEM, WHICH IS SYSTEM OF APPROXIMATION WHICH, DEPENDENT ON VARIABLES OF EACH SHIPMENT WILL SOMETIMES BE FAVORABLE TO EMPLOYEES AND UNDER OTHER CONDITIONS OPERATE SOMEWHAT TO HIS DISADVANTAGE.

TO MR. ABRAHAM ARNOLD:

YOUR LETTER OF SEPTEMBER 23, 1969, REQUESTS REVIEW OF OUR SETTLEMENT OF AUGUST 27, 1969, IN WHICH YOU WERE ALLOWED $578 REPRESENTING THE AMOUNT DUE COMPUTED UNDER THE COMMUTED RATE SYSTEM FOR THE TRANSPORTATION OF YOUR HOUSEHOLD GOODS FROM PATCHOGUE, LONG ISLAND, SUFFOLK COUNTY, NEW YORK, TO EATONTOWN, MONMOUTH COUNTY, NEW JERSEY, IN AUGUST 1967 INCIDENT TO THE TRANSFER OF YOUR OFFICIAL STATION TO FORT MONMOUTH, NEW JERSEY.

YOU ASK THAT YOU BE ALLOWED PAYMENT OF $296, THE DIFFERENCE BETWEEN THE COSTS ALLOWED ON THE COMMUTED BASIS, $578, AND THE ACTUAL COST OF THE SHIPMENT OF YOUR HOUSEHOLD GOODS AND EFFECTS, $874.

UNDER 5 U.S.C. 5724 AND THE REGULATIONS ISSUED PURSUANT THERETO, PAYMENT ON A COMMUTED BASIS IS AN AUTHORIZED METHOD OF REIMBURSING CIVILIAN EMPLOYEES FOR THE COST OF TRANSPORTATION OF THEIR HOUSEHOLD EFFECTS INCIDENT TO A TRANSFER WITHIN THE CONTINENTAL UNITED STATES. THE REGULATIONS IN QUESTION WERE PROMULGATED IN ACCORDANCE WITH AUTHORITY DELEGATED BY THE PRESIDENT AND HAVE THE FORCE AND EFFECT OF LAW.

IT IS YOUR CONTENTION THAT THE LANGUAGE OF SECTION 6.4C OF THE REGULATIONS (BUREAU OF THE BUDGET CIRCULAR NO. A-56) WHICH STATES THAT WHEN THE COMMUTED RATE SYSTEM IS USED "* * * THE GOVERNMENT IS OBLIGATED TO PAY FOR TRANSPORTATION AND TEMPORARY STORAGE COSTS UNDER STANDARD COMMERCIAL TARIFFS WITH NO DISCOUNTS * * *" ENTITLES YOU TO REIMBURSEMENT FOR THE ENTIRE AMOUNT OF EXPENSES INCURRED BY YOU IN YOUR MOVE, RATHER THAN THE AMOUNT ALLOWED UNDER THE COMMUTED RATE SYSTEM AS SPECIFIED IN SECTION 6.4A OF THE CIRCULAR.

THAT PART OF THE REGULATIONS QUOTED BY YOU IS CONTAINED IN A PARAGRAPH ENTITLED "GUIDELINES FOR DECIDING WHETHER TO USE THE COMMUTED RATE SYSTEM OR THE ACTUAL EXPENSE METHOD.' THE END OF SUCH PARAGRAPH CLEARLY INDICATES THAT THE INFORMATION CONTAINED THEREIN IS FOR THE USE OF THE ADMINISTRATIVE OFFICE IN DECIDING WHETHER TO AUTHORIZE SHIPMENT OF HOUSEHOLD EFFECTS ON AN ACTUAL EXPENSE BASIS. MOREOVER, WE UNDERSTAND THAT THE QUOTATION HERE INVOLVED WAS INTENDED TO REFLECT FOR INFORMATION PURPOSES THAT THE COMMUTED RATES ARE BASED ON COMMERCIAL TARIFFS WITHOUT DISCOUNTS TO THE GOVERNMENT. AT TIMES WHEN THERE IS SHIPMENT UNDER A GOVERNMENT BILL OF LADING, THE GOVERNMENT RECEIVES A DISCOUNT. HOWEVER, WHEN SHIPMENT IS UNDER A COMMERCIAL BILL OF LADING, THE TARIFFS SUBMITTED UPON WHICH THE COMMUTED RATE SYSTEM IS BASED CONTAIN NO GOVERNMENT DISCOUNTS.

THE COMMUTED RATE SYSTEM IS A SYSTEM OF APPROXIMATION WHICH, DEPENDENT UPON THE VARIABLES IN EACH SHIPMENT, WILL SOMETIMES BE FAVORABLE TO AN EMPLOYEE AND UNDER OTHER CONDITIONS OPERATE SOMEWHAT TO HIS DISADVANTAGE.

SINCE THE TRANSPORTATION OF YOUR HOUSEHOLD GOODS WAS NOT AUTHORIZED ON AN ACTUAL EXPENSE BASIS, REIMBURSEMENT FOR THE EXPENSES INCURRED IS LIMITED TO THAT AMOUNT ALLOWABLE UNDER THE COMMUTED RATE SYSTEM.

THEREFORE, UPON REVIEW, WE FIND NO ERROR IN THE ALLOWANCE MADE IN OUR OFFICE SETTLEMENT OF AUGUST 27, 1969, AND THAT SETTLEMENT MUST BE SUSTAINED.