B-170632, SEP. 10, 1970

B-170632: Sep 10, 1970

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AN EMPLOYEE WHO MADE A DEPOSIT ON AN APARTMENT BUT WHO PRIOR TO EXECUTING A LEASE WAS TRANSFERRED TO A NEW STATION MAY NOT BE REIMBURSED FOR THE AMOUNT OF THE FORFEITED DEPOSIT UNDER SECTION 4.2F BOB CIRCULAR NO. CONCERNS THE PROPRIETY OF REIMBURSING AN EMPLOYEE $150 AS A COST RELATED TO HIS TRANSFER OF STATION UNDER THE FOLLOWING CIRCUMSTANCES: "OUR EMPLOYEE WAS RESIDING IN AN APARTMENT IN CHICAGO WHEN. HE WAS NOTIFIED THAT HE WAS TO BE TRANSFERRED TO WASHINGTON. THERE WAS NO MONEY LOST IN TERMINATING THE LEASE ON THE APARTMENT IN WHICH HE DID RESIDE. *** " YOU INITIALLY REFUSED REIMBURSEMENT ON THE GROUND THAT THE SECOND APARTMENT WAS NOT THE EMPLOYEE'S ACTUAL RESIDENCE AS REQUIRED BY SECTION 4.1C OF BUREAU OF THE BUDGET CIRCULAR NO.

B-170632, SEP. 10, 1970

FORFEITURE OF RENTAL DEPOSIT DECISION TO CHAIRMAN, U.S. CIVIL SERVICE COMMISSION, ADVISING THAT A PORTION OF EMPLOYEE'S CLAIM FOR LOSS RESULTING FROM FORFEITURE OF DEPOSIT ON AN APARTMENT INCIDENT TO TRANSFER FROM CHICAGO TO WASHINGTON, D.C. MAY BE REIMBURSABLE AS A MISCELLANEOUS EXPENSE UNDER PROVISIONS OF CIRCULAR NO. A.56. AN EMPLOYEE WHO MADE A DEPOSIT ON AN APARTMENT BUT WHO PRIOR TO EXECUTING A LEASE WAS TRANSFERRED TO A NEW STATION MAY NOT BE REIMBURSED FOR THE AMOUNT OF THE FORFEITED DEPOSIT UNDER SECTION 4.2F BOB CIRCULAR NO. A-56 SINCE NO LEASE EXISTED TO BE TERMINATED FOR RELOCATION EXPENSE REIMBURSEMENT PURPOSES HOWEVER, A PORTION OF THE AMOUNT MAY BE REIMBURSABLE AS A MISCELLANEOUS EXPENSE UNDER SEC. 3.1B.

TO MR. HAMPTON:

YOUR LETTER OF AUGUST 17, 1970, CONCERNS THE PROPRIETY OF REIMBURSING AN EMPLOYEE $150 AS A COST RELATED TO HIS TRANSFER OF STATION UNDER THE FOLLOWING CIRCUMSTANCES:

"OUR EMPLOYEE WAS RESIDING IN AN APARTMENT IN CHICAGO WHEN, ON MARCH 18, 1969, HE MADE A $150 DEPOSIT ON A DIFFERENT APARTMENT. THEREAFTER, ON APRIL 1, 1969, HE WAS NOTIFIED THAT HE WAS TO BE TRANSFERRED TO WASHINGTON, D.C., AND HE SO TRANSFERRED ON MAY 5, 1969. THE EMPLOYEE NEVER OCCUPIED THE SECOND APARTMENT ON WHICH HE MADE THE $150 DEPOSIT, IN FACT HE NEVER SIGNED A LEASE ON THAT APARTMENT AS HE BECAME AWARE OF THE MOVE TO WASHINGTON, D.C., BEFORE THE LEASE HAD TO BE SIGNED. THE LANDLORD FOR THE SECOND APARTMENT WOULD NOT RETURN THE $150 DEPOSIT AND THE EMPLOYEE MADE A CLAIM FOR IT. THERE WAS NO MONEY LOST IN TERMINATING THE LEASE ON THE APARTMENT IN WHICH HE DID RESIDE. *** "

YOU INITIALLY REFUSED REIMBURSEMENT ON THE GROUND THAT THE SECOND APARTMENT WAS NOT THE EMPLOYEE'S ACTUAL RESIDENCE AS REQUIRED BY SECTION 4.1C OF BUREAU OF THE BUDGET CIRCULAR NO. A-56 (1966). YOU NOW BELIEVE, HOWEVER, THAT THE AMOUNT MAY BE PAYABLE AS A RELOCATION EXPENSE UNDER THE RATIONALE FOLLOWED IN OUR DECISION B-168818 DATED FEBRUARY 9, 1970, IN WHICH WE SAID THAT THE REGULATION IS NOT INTENDED TO APPLY IN SITUATIONS "WHERE THE EMPLOYEE HAS IN GOOD FAITH ENTERED INTO A CONTRACT FOR THE PURCHASE OF A RESIDENCE AT HIS OLD DUTY STATION PRIOR TO RECEIVING HIS TRANSFER ORDER IS UNABLE TO CANCEL CONTRACT AND IS PRECLUDED FROM ESTABLISHING HIS RESIDENCE IN HOUSE BECAUSE OF A TRANSFER."

IN RESPONSE, WE WOULD POINT OUT THAT IN ADDITION TO THE REQUIREMENT OF SUBSECTION 4.1C THAT THE DWELLING AT THE OLD OFFICIAL STATION FOR WHICH SELLING COSTS MAY BE ALLOWED MUST HAVE BEEN THE EMPLOYEE'S ACTUAL RESIDENCE AT THE TIME HE WAS INFORMED OF A TRANSFER, SUBSECTION 4.1 OF CIRCULAR NO. A-56 (1966) PROVIDES AS FOLLOWS:

"4.1 CONDITIONS AND REQUIREMENTS UNDER WHICH ALLOWANCES MAY BE PAID. THE EXTENT ALLOWABLE UNDER THIS PROVISION, THE GOVERNMENT WILL REIMBURSE AN EMPLOYEE FOR EXPENSES REQUIRED TO BE PAID BY HIM IN CONNECTION WITH THE SALE OF ONE RESIDENCE AT HIS OLD OFFICIAL STATION; PURCHASE OF ONE DWELLING AT HIS NEW OFFICIAL STATION; OR THE SETTLEMENT OF AN UNEXPIRED LEASE AT HIS PLACE OF RESIDENCE AT THE OLD OFFICIAL STATION *** "

YOUR LETTER STATES THAT "THE EMPLOYEE NEVER OCCUPIED THE SECOND APARTMENT ON WHICH HE MADE THE $150 DEPOSIT, IN FACT HE NEVER SIGNED A LEASE ON THAT APARTMENT AS HE BECAME AWARE OF THE MOVE TO WASHINGTON, D.C., BEFORE THE LEASE HAD TO BE SIGNED." WE BELIEVE THE FACTS IN THE CASE YOU PRESENT ARE NOT ANALOGOUS WITH THOSE IN B-168818. IN THE CITED CASE, THE EMPLOYEE, HAVING CONTRACTED TO PURCHASE A HOUSE BEFORE NOTIFICATION OF HIS TRANSFER, WAS LEGALLY OBLIGATED TO CONSUMMATE HIS AGREEMENT AND WAS, IN FACT, THE OWNER OF THE RESIDENCE SOLD. CF. B 163546 DATED MARCH 8, 1968, COPY ENCLOSED, IN WHICH WE ALLOWED REIMBURSEMENT OF A SECURITY DEPOSIT FOR RENTAL OF A RESIDENCE NEVER OCCUPIED BY THE EMPLOYEE (ALTHOUGH USED FOR STORAGE OF HOUSEHOLD GOODS) BUT WHERE A LEASE HAD BEEN EXECUTED.

IN THE INSTANT CASE NO LEASE EVER EXISTED TO BE TERMINATED FOR WHICH THE EXPENSE MIGHT HAVE BEEN COMPENSABLE UNDER PROVISIONS OF SUBSECTION 4.2F OF CIRCULAR NO. A-56.

WE WOULD POINT OUT, HOWEVER, THAT A PORTION OR ALL OF THE AMOUNT INVOLVED MAY BE REIMBURSABLE TO THE EMPLOYEE AS A MISCELLANEOUS EXPENSE -FORFEITURE OF DEPOSIT--UNDER THE PROVISIONS OF SECTION 3.1B OF CIRCULAR NO. A-56 (1966). SEE SPECIFICALLY SECTION 3.2A(2).