B-171058, APR 6, 1971, 50 COMP GEN 705

B-171058: Apr 6, 1971

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TRANSPORTATION - HOUSEHOLD EFFECTS - MILITARY PERSONNEL - WEIGHT LIMITATION - MINIMUM FOR AUDIT PURPOSES A PROPOSED PROCEDURE TO ESTABLISH A MINIMUM WEIGHT OF 300 POUNDS FOR THE EXAMINATION OF SHIPPING DOCUMENTS OF HOUSEHOLD GOODS SHIPMENTS TO DETERMINE IF THERE ARE EXCESS COSTS ON ACCOUNT OF MEMBERS OF THE UNIFORMED SERVICES EXCEEDING THEIR AUTHORIZED WEIGHT ALLOWANCES WOULD NOT SATISFY THE AUDIT REQUIREMENTS OF THE UNITED STATES GENERAL ACCOUNTING OFFICE AND MAY NOT BE APPROVED AS THERE IS NO LEGAL BASIS FOR DISREGARDING SHIPMENTS WEIGHING LESS THAN 300 POUNDS IN DETERMINING WHETHER EXCESS COSTS ARE INVOLVED WHEN TO DO SO COULD SERVE TO PERMIT SHIPMENT AT GOVERNMENT EXPENSE OF WEIGHTS IN EXCESS OF THOSE PRESCRIBED BY THE JOINT TRAVEL REGULATIONS IMPLEMENTING 37 U.S.C. 406 AUTHORIZING SHIPMENT.

B-171058, APR 6, 1971, 50 COMP GEN 705

TRANSPORTATION - HOUSEHOLD EFFECTS - MILITARY PERSONNEL - WEIGHT LIMITATION - MINIMUM FOR AUDIT PURPOSES A PROPOSED PROCEDURE TO ESTABLISH A MINIMUM WEIGHT OF 300 POUNDS FOR THE EXAMINATION OF SHIPPING DOCUMENTS OF HOUSEHOLD GOODS SHIPMENTS TO DETERMINE IF THERE ARE EXCESS COSTS ON ACCOUNT OF MEMBERS OF THE UNIFORMED SERVICES EXCEEDING THEIR AUTHORIZED WEIGHT ALLOWANCES WOULD NOT SATISFY THE AUDIT REQUIREMENTS OF THE UNITED STATES GENERAL ACCOUNTING OFFICE AND MAY NOT BE APPROVED AS THERE IS NO LEGAL BASIS FOR DISREGARDING SHIPMENTS WEIGHING LESS THAN 300 POUNDS IN DETERMINING WHETHER EXCESS COSTS ARE INVOLVED WHEN TO DO SO COULD SERVE TO PERMIT SHIPMENT AT GOVERNMENT EXPENSE OF WEIGHTS IN EXCESS OF THOSE PRESCRIBED BY THE JOINT TRAVEL REGULATIONS IMPLEMENTING 37 U.S.C. 406 AUTHORIZING SHIPMENT. MOREOVER, DEPARTMENTS HAVE THE RESPONSIBILITY TO MAINTAIN ADEQUATE CONTROLS IN ORDER TO DETERMINE WHEN SHIPMENTS INVOLVING EXCESS COSTS HAVE BEEN MADE AND TO TAKE APPROPRIATE ACTION TO RECOVER THE AMOUNT OF ANY EXCESS COSTS.

TO THE SECRETARY OF THE ARMY, APRIL 6, 1971:

FURTHER REFERENCE IS MADE TO LETTER OF SEPTEMBER 29, 1970, FROM THE ASSISTANT SECRETARY OF THE ARMY, REQUESTING OUR OPINION RELATIVE TO A PROPOSED PROCEDURE PERTAINING TO THE EXAMINATION OF SHIPPING DOCUMENTS FOR THE PURPOSE OF DETERMINING EXCESS COSTS RESULTING FROM SHIPMENTS IN EXCESS OF THE WEIGHT ALLOWANCE OF HOUSEHOLD EFFECTS AUTHORIZED FOR MILITARY PERSONNEL UNDER THE JOINT TRAVEL REGULATIONS. THE REQUEST HAS BEEN ASSIGNED PDTATAC CONTROL NO. 70-49, BY THE PER DIEM, TRAVEL AND TRANSPORTATION ALLOWANCE COMMITTEE.

THE ASSISTANT SECRETARY SAYS THAT A STAFF STUDY WAS MADE AT THE ARMY FINANCE CENTER, INDIANAPOLIS, INDIANA, OF THE SHIPMENTS OF HOUSEHOLD GOODS OF MILITARY PERSONNEL UNDER ITS JURISDICTION. AS A RESULT OF THE STUDY, THE FINANCE CENTER IS REQUESTING APPROVAL OF A PROPOSED PROCEDURE WHICH WOULD ESTABLISH A MINIMUM WEIGHT OF 300 POUNDS FOR THE EXAMINATION OF SHIPPING DOCUMENTS OF HOUSEHOLD GOODS SHIPMENTS TO DETERMINE IF THERE ARE EXCESS COSTS ON ACCOUNT OF MEMBERS EXCEEDING THEIR AUTHORIZED WEIGHT ALLOWANCES. THE ASSISTANT SECRETARY THEREFORE REQUESTS OUR OPINION AS TO WHETHER THE PROPOSED PROCEDURE WOULD SATISFY THE AUDIT REQUIREMENTS OF OUR OFFICE.

IN THE LETTER FROM THE FINANCE CENTER, IT IS EXPLAINED THAT UNDER CURRENT PROCEDURES EAM (ELECTRONIC ACCOUNTING MACHINE) DATA CARDS ARE PREPARED FOR ALL SHIPMENTS OF PERSONAL PROPERTY MOVED ON GOVERNMENT BILLS OF LADING. THESE CARDS ARE THEN PROCESSED ON A COMPUTER SYSTEM WHICH ACCUMULATES THE DATA FOR EACH MEMBER BY SOCIAL SECURITY ACCOUNT NUMBER. WHEN THE ACCUMULATED WEIGHTS EXCEED THE AUTHORIZED ALLOWANCE, A POTENTIALLY EXCESS COST REPORT IS PRINTED OUT FOR ADJUDICATION. IF THE POTENTIALLY EXCESS CASE IS DETERMINED TO BE EXCESS, AND THE RELATED EXCESS COST IS GREATER THAN $10, THEN A CLAIM IS INITIATED BY ISSUANCE OF A PAY ADJUSTMENT AUTHORIZATION FORM (DD 139).

IT WAS STATED THAT FOR THE PURPOSE OF THE STUDY, ASSUMPTIONS WERE MADE THAT THE PRIMARY OBJECTIVE OF THE MISSION IS TO EFFECT THE GREATEST POSSIBLE SAVINGS TO THE GOVERNMENT. THE SECONDARY OBJECTIVE IS TO ACT AS A DETERRENT, INDUCING MEMBERS NOT TO EXCEED THEIR AUTHORIZED WEIGHT ALLOWANCE WHEN SHIPPING HOUSEHOLD EFFECTS. THE STUDY WAS TO SHOW THAT THE EFFECTIVE ACCOMPLISHMENT OF THE TWOFOLD OBJECTIVES OF THE MISSION DOES NOT REQUIRE EXAMINATION OF ALL HOUSEHOLD GOODS SHIPMENTS AND THAT MAXIMUM RECOUPMENT OF EXCESS CLAIMS AT PROHIBITIVE PROCESSING COSTS IS CONTRARY TO THE PRIMARY OBJECTIVE.

THE STUDY IS SAID TO HAVE UTILIZED A RANDOM SAMPLING TECHNIQUE UNDER WHICH 513 CASE FOLDERS WERE SELECTED FROM THE 1969 CASE FILES. OF THOSE CASES, 76 WERE DISCOVERED TO INVOLVE BILLABLE EXCESS COSTS. ON THE BASIS OF THE EXCESS CLAIMS AMOUNTS AND THE WEIGHTS OF THE SHIPMENTS, THERE WAS ESTIMATED THE DOLLAR AMOUNT OF CLAIMS BY 100-POUND WEIGHT GROUPS. ORDER TO COMPUTE ADJUDICATION COSTS, A SUBSAMPLE OF 274 CASES WAS THEN SELECTED FROM THE 513 CASES AND ARRANGED BY WEIGHT GROUPS IN 100-POUND INTERVALS. THE DATA SHOWED THE ESTIMATED LOSS OF CLAIMS WHICH WOULD NOT BE DISCOVERED OR BE BILLED AND, ALSO, THE PROCESSING COST SAVINGS, WITH A PROJECTED NET SAVINGS TO THE GOVERNMENT FOR EACH WEIGHT CUTOFF.

THE STUDY ALSO CONTAINS A GRAPH COMPARING THE AVERAGE BILLABLE EXCESS COST WITH AVERAGE PROCESSING COST ON THE BASIS OF THE PROJECTED SAMPLING DATA. THIS SHOWS THAT IN WEIGHTS IN EXCESS OF 300 POUNDS, THE COST OF PROCESSING A CASE BREAKS SHARPLY DOWNWARD AND THE BILLABLE AMOUNT BREAKS SHARPLY UPWARD, WITH A BREAK-EVEN POINT AT 348 POUNDS. IT WAS THEREFORE DETERMINED THAT THE DATA, WHICH WAS SAID TO BE REPRESENTATIVE AND WHICH MAY BE USED TO PROJECT FUTURE RESULTS, DEMONSTRATES THAT A WEIGHT CUTOFF OF 300 POUNDS WOULD BE FEASIBLE AND DESIRABLE, RESULTING IN A NET SAVINGS TO THE GOVERNMENT, INCLUDING PERSONNEL SAVINGS OF SEVERAL SPACES.

SECTION 406 OF TITLE 37, U.S.C. AUTHORIZES IN CONNECTION WITH A CHANGE OF TEMPORARY OR PERMANENT STATION, THE TRANSPORTATION AND STORAGE OF BAGGAGE AND HOUSEHOLD EFFECTS OF MILITARY PERSONNEL WITHIN SUCH WEIGHT ALLOWANCES AS PRESCRIBED BY THE SECRETARIES CONCERNED.

PARAGRAPH M8003-1, JOINT TRAVEL REGULATIONS, PROMULGATED PURSUANT TO THE AUTHORITY CITED ABOVE, PROVIDES A TABLE OF WEIGHT ALLOWANCES ON A GRADUATED WEIGHT SCALE FOR TEMPORARY AND PERMANENT CHANGES OF STATIONS, ACCORDING TO GRADE OR RANK OF MILITARY PERSONNEL COMMENCING WITH AVIATION CADETS AND THEN ENLISTED MEMBERS IN GRADE E-4, HAVING THE SPECIFIED SERVICE REQUIREMENTS. A FOOTNOTE TO THE TABLE CITES SECTION 616 OF THE DEFENSE DEPARTMENT APPROPRIATION ACT, 1970, PUBLIC LAW 83 STAT. 483, WHICH LIMITS THE MEMBERS TO A MAXIMUM NET WEIGHT OF 13,500 POUNDS IN ANY ONE SHIPMENT CHARGEABLE TO FUNDS APPROPRIATED BY THAT ACT. A SIMILAR LIMITATION IS CONTAINED IN THE 1971 APPROPRIATION ACT (SEC 816, PUBLIC LAW 91-668, JANUARY 11, 1971, 84 STAT. 2033). PARAGRAPH M8003-2, PRESCRIBES A RESTRICTION OF 2,000 POUNDS OR 25 PERCENT OF THE MAXIMUM CHANGE-OF-STATION WEIGHT ALLOWANCE PRESCRIBED IN SUBPARAGRAPH 1, FOR SHIPMENT OF HOUSEHOLD GOODS AND PERSONAL EFFECTS OF MEMBERS TO AND FROM OVERSEAS STATIONS WHERE QUARTERS ARE FURNISHED WITH GOVERNMENT-OWNED FURNISHINGS.

PARAGRAPH M8007-2 OF THEIR REGULATIONS PROVIDES THAT THE GOVERNMENT'S MAXIMUM TRANSPORTATION OBLIGATION IS THE COST OF A THROUGH HOUSEHOLD GOODS MOVEMENT OF A MEMBER'S PRESCRIBED ALLOWANCE IN ONE LOT BETWEEN AUTHORIZED PLACES AT A VALUATION EQUIVALENT TO THE LOWEST APPLICABLE RATE ESTABLISHED IN THE CARRIER'S TARIFFS. THE MEMBER WILL BEAR ALL TRANSPORTATION COSTS ARISING FROM SHIPMENT IN MORE THAN ONE LOT, FOR DISTANCES IN EXCESS OF THAT BETWEEN AUTHORIZED POINTS, AND FOR WEIGHTS IN EXCESS OF THE MAXIMUM ALLOWANCES PRESCRIBED IN PARAGRAPH M8003-1. PARAGRAPH M8008-1 OF THE REGULATIONS PROVIDES THAT FOR MEMBERS FOR WHOM NO WEIGHT ALLOWANCE HAS BEEN PRESCRIBED, NOT MORE THAN 200 POUNDS OF BAGGAGE MAY BE SHIPPED AT GOVERNMENT EXPENSE TO A NEW STATION.

OUR REVIEW OF THE STATISTICAL SAMPLING PLAN APPEARS TO INDICATE THAT BECAUSE OF THE SMALL SAMPLE SIZES ON WHICH THE ESTIMATES ARE BASED, THE DOLLAR PROJECTIONS FOR "LOSS OF CLAIMS" ARE SUBJECT TO VERY LARGE SAMPLING ERRORS. AND, WHILE THE STUDY INDICATES A SAVINGS TO THE GOVERNMENT UNDER THE PROPOSED CHANGE IN PROCEDURE, SUCH PROPOSAL DOES NOT TAKE INTO ACCOUNT THE SAVINGS TO THE GOVERNMENT BECAUSE OF THE DETERRENT EFFECT IN ASSEMBLING DATA AS TO THE TOTAL WEIGHT OF GOODS SHIPPED BY MEMBERS WITH A VIEW TO RECOVERY OF EXCESS COSTS, AND THE INCREASED COSTS THAT WOULD LIKELY RESULT IF THIS DETERRENT WERE REMOVED.

THE PROPOSAL OBVIOUSLY WOULD HAVE THE EFFECT OF INCREASING THE AUTHORIZED WEIGHT ALLOWANCE OF 200 POUNDS PRESCRIBED FOR MEMBERS IN THE APPLICABLE GRADES, TO 299 POUNDS, SINCE ANY SHIPMENT WEIGHING LESS THAN 300 POUNDS WOULD BE EXCLUDED FROM FURTHER CONSIDERATION IN DETERMINING EXCESS COSTS.

LIKEWISE, THE PROPOSAL WOULD HAVE THE EFFECT OF INCREASING THE WEIGHT ALLOWANCE FOR ALL MEMBERS WHOSE GOODS ARE MOVED IN MULTIPLE SHIPMENTS, WHERE THE WEIGHT OF A SINGLE SHIPMENT IS LESS THAN 300 POUNDS, AS THE WEIGHT OF THAT SHIPMENT WOULD BE EXCLUDED IN DETERMINING THE TOTAL WEIGHT SHIPPED. THIS COULD RESULT IN EXPENDITURES FOR SHIPMENTS IN EXCESS OF THE WEIGHT LIMITATIONS FIXED BY STATUTE AS WELL AS THE LIMITATIONS SET FORTH IN THE JOINT TRAVEL REGULATIONS.

UNDER THE ABOVE-MENTIONED REGULATIONS AND STATUTORY PROVISIONS, IT IS THE RESPONSIBILITY OF THE DEPARTMENTS TO MAINTAIN ADEQUATE CONTROLS IN ORDER TO DETERMINE WHEN SHIPMENTS INVOLVING EXCESS COSTS HAVE BEEN MADE AND TO TAKE APPROPRIATE ACTION TO RECOVER THE AMOUNT OF EXCESS COSTS IN SUCH CASES. WHILE THE METHOD USED TO IDENTIFY SUCH EXCESS SHIPMENTS IS PRIMARILY FOR ADMINISTRATIVE DETERMINATION, ANY SUCH METHOD MUST BE CONSISTENT WITH THE REQUIREMENTS OF THE GOVERNING LAWS AND REGULATIONS; AND WE ARE OF THE OPINION THAT THERE IS NO LEGAL BASIS FOR DISREGARDING SHIPMENTS WEIGHING LESS THAN 300 POUNDS IN DETERMINING WHETHER EXCESS COSTS ARE INVOLVED WHEN TO DO SO COULD SERVE TO PERMIT THE SHIPMENT AT GOVERNMENT EXPENSE OF WEIGHTS IN EXCESS OF THOSE AUTHORIZED BY LAW AND REGULATIONS. THEREFORE, THE PROPOSED PROCEDURE WOULD NOT SATISFY AUDIT REQUIREMENTS AND WE MAY NOT GIVE IT OUR APPROVAL.