B-241781, Apr 15, 1991

B-241781: Apr 15, 1991

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The statutory condition to payment of real estate expenses on transfer is that the employee remain in government service a minimum of 12 months without a break in service. Since time with a particular agency is not a condition precedent to payment. The transferring agency is obligated to pay the expenses in question. An employee of the Department of Veterans Affairs (VA) was transferred from the VA Medical Center. The VA contends that since the residence purchase was not made until well after she transferred to the Corps of Engineers. The purchase was not incident to her VA transfer to Louisville and the VA should not be required to reimburse her. /1/ Under the provisions of paragraph 2-6.1e of the Federal Travel Regulations (FTR).

B-241781, Apr 15, 1991

CIVILIAN PERSONNEL - Relocation - Residence transaction expenses - Reimbursement - Eligibility DIGEST: A transferred employee voluntarily left her agency 6 months after she reported for duty at her new station and went to work for another agency at the same location. She thereafter, but timely purchased a residence in the area and seeks reimbursement from the first agency for real estate expenses. The statutory condition to payment of real estate expenses on transfer is that the employee remain in government service a minimum of 12 months without a break in service. Since time with a particular agency is not a condition precedent to payment, so long as the employee performs the minimum 12 months without break, the transferring agency is obligated to pay the expenses in question. Finn v. United States, 192 Ct.Cl. 814 (1970), and cases cited.

Alice J. Converse:

Mrs. Alice J. Converse, an employee of the Department of Veterans Affairs (VA) was transferred from the VA Medical Center, Castle Point, New York, to the VA Medical Center, Louisville, Kentucky, effective March 29, 1989. On September 23, 1989, she left the VA and transferred to a position with the Corps of Engineers, also in Louisville, Kentucky, without a break in service.

On May 4, 1990, Mrs. Converse purchased a residence within commuting distance of Louisville, Kentucky, and made claim to the VA for expenses of purchase. The VA contends that since the residence purchase was not made until well after she transferred to the Corps of Engineers, the purchase was not incident to her VA transfer to Louisville and the VA should not be required to reimburse her. /1/

Under the provisions of paragraph 2-6.1e of the Federal Travel Regulations (FTR), /2/ an employee who is transferred in the interest of the government has not less than 2 years following reporting for duty at the new station to purchase a new residence at that station in connection with that transfer.

Although Mrs. Converse only remained with the VA for approximately 6 months after her transfer to Louisville, it was held in Finn v. United States, 192 Ct.Cl. 814 (1970), that a government agency does not have the authority to require an employee to agree to remain in the service of that particular agency for 12 months following the effective date of transfer as a condition precedent to relocation expense reimbursement. The court held that under 5 U.S.C. Sec. 5724(i) (1988), reimbursement of relocation expenses is predicated upon a transfer in the interest of the government and an agreement to remain in government service for at least 12 months following a permanent change of station.

Thus, in Finn, an FBI agent was transferred from Dallas to St. Louis. After 7 months there, he resigned and transferred to the IRS. The FBI attempted to recoup the moving and transportation expenses it had paid because Finn had violated his agreement to remain in FBI service for 12 months after transfer. The Court of Claims disagreed, holding that government service, not agency service, is controlling and that Finn was entitled to keep the expenses he had been paid. See 55 Comp.Gen. 645 (1976); Calvin Reese, B-187834, June 21, 1977; Ronald C. Thomas, B-207507, May 17, 1983.

In Lucy S. Tyler, B-222371, Nov. 17, 1986, the transferring agency was held liable for house sale and purchase expenses even though they were incurred after the employee had left government service (after completing the agreed upon 12 months).

Therefore, if it is established that Mrs. Converse performed at least 12 months of government service without a break in service after she reported for duty at the VA Medical Center, Louisville, Kentucky, on March 29, 1989, she is entitled to the real estate expenses authorized to be paid under chapter 2, part 6 of the Federal Travel Regulations, and the VA is obligated to pay those expenses incident to her transfer.

/1/ Request submitted by VA's Deputy Assistant Secretary for Financial Management, Ref: 047G4:8-5-1.

/2/ Incorp. by ref., 41 C.F.R. Sec. 101-7.003 (1989).