B-168709, JAN. 28, 1970
Highlights
MAY NOT BE REIMBURSED FOR LOAN ORIGINATION FEE SINCE SUCH FEE WAS REMOVED FROM THE REIMBURSABLE ITEMS IN SEC. 4 OF THE BUREAU OF THE BUDGET CIRCULAR NO. FRIDLEY NOW SEEKS RECONSIDERATION OF THE DISALLOWANCE BECAUSE HE DID NOT KNOW OF THE CHANGE AND HIS DECISION TO MAKE THE CHANGE IN STATION WAS IN PART PREDICATED ON ADVICE THAT THE LENDER'S LOAN ORIGINATION FEE WAS REIMBURSABLE. DELETION OF THE LOAN ORIGINATION FEE FROM THE CIRCULAR WAS BASED ON THE TRUTH IN LENDING ACT. SINCE THE APPLICABLE SECTIONS OF THAT ACT WERE NOT EFFECTIVE UNTIL JULY 1. A-56 WAS NOT EFFECTIVE UNTIL THAT DATE. WE HAVE HELD THAT THE DATE EXPENSES ARE INCURRED IS CONTROLLING IN MOST INSTANCES IN FIXING THE RIGHTS OF EMPLOYEES TO BENEFITS PROVIDED BY 5 U.S.C. 5724A.
B-168709, JAN. 28, 1970
CIVIL PAY--TRANSFERS--LOAN ORIGINATION FEE DECISION TO DISBURSING OFFICER OF DEFENSE SUPPLY AGENCY CONCERNING REIMBURSING EMPLOYEE FOR REAL ESTATE EXPENSES INCIDENT TO PURCHASE OF RESIDENCE AT NEW DUTY STATION. EMPLOYEE WHO SIGNED MORTGAGE ON PURCHASE OF HOUSE ON JUNE 26, 1969, BUT DATE OF SETTLEMENT AND INTEREST BEGAN ON JULY 25, 1969, MAY NOT BE REIMBURSED FOR LOAN ORIGINATION FEE SINCE SUCH FEE WAS REMOVED FROM THE REIMBURSABLE ITEMS IN SEC. 4 OF THE BUREAU OF THE BUDGET CIRCULAR NO. A 56 ON JULY 1, 1969. THEREFORE THE EXPENSE HAVING OCCURRED AFTER JULY 1, 1969 MAY NOT BE REIMBURSED.
TO MAJOR S. G. OROSCO:
YOUR LETTER OF NOVEMBER 10, 1969, WITH ENCLOSURES, REFERENCE DCRI FO, FORWARDED HERE ON DECEMBER 22, 1969, BY THE PER DIEM, TRAVEL AND TRANSPORTATION ALLOWANCE COMMITTEE, REQUESTS A DECISION ON THE ALLOWABILITY OF $626 FOR REIMBURSEMENT OF REAL ESTATE EXPENSES TO MR. JAMES D. FRIDLEY INCIDENT TO A PERMANENT CHANGE OF OFFICIAL STATION AS AN EMPLOYEE OF THE DEFENSE SUPPLY AGENCY.
THE SUBJECT AMOUNT OF $626 REPRESENTS A LOAN ORIGINATION FEE PAID BY MR. FRIDLEY AT SETTLEMENT ON JULY 25, 1969, AS PART OF THE EXPENSES INCURRED BY HIM IN PURCHASING HIS RESIDENCE AT HIS NEW DUTY STATION. REIMBURSEMENT BY THE ADMINISTRATIVE OFFICE HAS BEEN DENIED DUE TO THE REVISION OF THE APPLICABLE REGULATIONS IN SECTION 4.2D OF BUREAU OF THE BUDGET CIRCULAR NO. A-56 AS REVISED JUNE 26, 1969.
MR. FRIDLEY NOW SEEKS RECONSIDERATION OF THE DISALLOWANCE BECAUSE HE DID NOT KNOW OF THE CHANGE AND HIS DECISION TO MAKE THE CHANGE IN STATION WAS IN PART PREDICATED ON ADVICE THAT THE LENDER'S LOAN ORIGINATION FEE WAS REIMBURSABLE.
THE JUNE 26, 1969, REVISION OF SECTION 4 OF CIRCULAR NO. A-56 REMOVED "LENDER'S LOAN ORIGINATION FEE" FROM THE LISTING OF REIMBURSABLE EXPENSES IN CONNECTION WITH REAL ESTATE TRANSACTIONS. DELETION OF THE LOAN ORIGINATION FEE FROM THE CIRCULAR WAS BASED ON THE TRUTH IN LENDING ACT, PUBLIC LAW 90-321. SINCE THE APPLICABLE SECTIONS OF THAT ACT WERE NOT EFFECTIVE UNTIL JULY 1, 1969, THE DELETION OF THE LOAN ORIGINATION FEE FROM CIRCULAR NO. A-56 WAS NOT EFFECTIVE UNTIL THAT DATE. SEE B-168065, NOVEMBER 19, 1969, COPY ENCLOSED.
WE HAVE HELD THAT THE DATE EXPENSES ARE INCURRED IS CONTROLLING IN MOST INSTANCES IN FIXING THE RIGHTS OF EMPLOYEES TO BENEFITS PROVIDED BY 5 U.S.C. 5724A. SEE B-168011, OCTOBER 24, 1969, COPY ENCLOSED. THE DATE OF MORTGAGE IS SHOWN ON THE CLOSING STATEMENT AS JUNE 26, 1969; HOWEVER, THE DATE OF SETTLEMENT WAS JULY 25, 1969, AND INTEREST ON THE LOAN DID NOT BEGIN UNTIL THAT DATE. ON THE RECORD MR. FRIDLEY DID NOT INCUR THE EXPENSE OF THE LOAN ORIGINATION FEE UNTIL JULY 25, 1969. SEE B-168239, DECEMBER 15, 1969; COMPARE B-168475, JANUARY 16, 1970, AND B-168476, JANUARY 19, 1970, COPIES ENCLOSED.