B-73694, MARCH 16, 1948, 27 COMP. GEN. 527

B-73694: Mar 16, 1948

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MAY NOT BE CREDITED TO THE CONSTRUCTION FUND FOR ADDITIONAL OBLIGATION BUT ARE FOR DEPOSITING INTO MISCELLANEOUS RECEIPTS. 1948: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 13. RESERVE SHIPYARDS AND WAREHOUSES) WHICH ARE NOT SURPLUS TO THE PRESENT OR FUTURE REQUIREMENTS OF THE UNITED STATES MARITIME COMMISSION. WHICH ARE MAINTAINED BY THE COMMISSION. THERE WAS FORWARDED WITH YOUR LETTER A MEMORANDUM DATED FEBRUARY 6. THERE ARE PRESENTLY PENDING BEFORE THE COMMISSION SEVERAL OFFERS TO LEASE PORTIONS OF VARIOUS SHIPYARDS AND OF ONE WAREHOUSE. A DETERMINATION WILL HAVE TO BE MADE AS A RESULT OF A SITUATION CREATED BY (1) EXTREMELY LIMITED BUDGET FOR THE FISCAL YEAR 1949 (FOR SHIPYARDS $118.

B-73694, MARCH 16, 1948, 27 COMP. GEN. 527

MARITIME COMMISSION LEAVES OF SHIPYARDS, ETC. - DEPOSIT REQUIREMENT OF AMOUNTS RECEIVED IN REIMBURSEMENT OF UTILITIES FURNISHED, DAMAGE REPAIR PAYMENTS, ETC. IN VIEW OF THE PROVISIONS IN THE INDEPENDENT OFFICES APPROPRIATION ACT, 1948, LIMITING THE AMOUNT THAT THE CONSTRUCTION FUND OF THE MARITIME COMMISSION MAY BE OBLIGATED FOR MAINTENANCE AND OPERATION OF SHIPYARDS, WAREHOUSES, AND TERMINALS, AND REQUIRING THAT RECEIPTS WHICH OTHERWISE WOULD BE DEPOSITED TO THE CREDIT OF SUCH FUND TO BE COVERED INTO MISCELLANEOUS RECEIPTS, AMOUNTS PAID BY LESSEE OF SHIPYARDS, WAREHOUSES, AND TERMINALS AS REIMBURSEMENT FOR UTILITIES FURNISHED BY THE GOVERNMENT, AS WELL AS PAYMENTS ON ACCOUNT OF DAMAGE REPAIR AND RENTAL OF GOVERNMENT- OWNED AND OPERATED EQUIPMENT, MAY NOT BE CREDITED TO THE CONSTRUCTION FUND FOR ADDITIONAL OBLIGATION BUT ARE FOR DEPOSITING INTO MISCELLANEOUS RECEIPTS.

COMPTROLLER GENERAL WARREN TO THE CHAIRMAN, UNITED STATES MARITIME COMMISSION, MARCH 16, 1948:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 13, 1948, RELATIVE TO THE PROPOSED LEASING TO COMMERCIAL INTERESTS OF SEVERAL PERMANENT INSTALLATIONS (MARINE TERMINALS, RESERVE SHIPYARDS AND WAREHOUSES) WHICH ARE NOT SURPLUS TO THE PRESENT OR FUTURE REQUIREMENTS OF THE UNITED STATES MARITIME COMMISSION, AND WHICH ARE MAINTAINED BY THE COMMISSION.

THERE WAS FORWARDED WITH YOUR LETTER A MEMORANDUM DATED FEBRUARY 6, 1948, WHICH EXPLAINS THE CIRCUMSTANCES INVOLVED IN THE LEASING OF SUCH INSTALLATIONS, AND WHICH READS, IN PART, AS FOLLOWS:

IT WOULD APPEAR TO BE IN THE BEST INTEREST OF THE GOVERNMENT TO LEASE THESE PROPERTIES TO COMMERCIAL INTERESTS, SUBJECT TO RECAPTURE, PROPER MAINTENANCE, PRESERVATION OF THE CHARACTER OF THE FACILITY, ETC. SUCH A POLICY WOULD AID LOCAL AND NATIONAL ECONOMIES AND REIMBURSE THE GOVERNMENT FOR MAINTENANCE, PRESERVATION AND SECURITY EXPENSES AND WITH DEFINITE PROFIT POSSIBILITIES.

THERE ARE PRESENTLY PENDING BEFORE THE COMMISSION SEVERAL OFFERS TO LEASE PORTIONS OF VARIOUS SHIPYARDS AND OF ONE WAREHOUSE. HOWEVER, BEFORE SUCH LEASES CAN BE CONSIDERED, A DETERMINATION WILL HAVE TO BE MADE AS A RESULT OF A SITUATION CREATED BY (1) EXTREMELY LIMITED BUDGET FOR THE FISCAL YEAR 1949 (FOR SHIPYARDS $118,750 PER YARD AS AGAINST $180,000 FOR FISCAL YEAR 1948) FOR MAINTENANCE, PRESERVATION AND SECURITY, AND (2) PRESENT GOVERNMENT RULINGS PROHIBITING REIMBURSEMENT OF SUCH FUNDS FOR MONIES ADVANCED FOR THE ACCOUNT OF LESSEES, TENANTS, ETC. SUCH REIMBURSEMENTS ARISE NORMALLY OUT OF THE LEASING SITUATION AND ARE GENERALLY AS FOLLOWS:

(1) REIMBURSEMENT TO MAINTENANCE FUND FOR TENANT'S SHARE OF COST OF UTILITIES (HEAT, LIGHT, POWER AND WATER).

(2) REIMBURSEMENT TO MAINTENANCE FUND FOR REPAIR WORK (DAMAGE) PERFORMED FOR THE ACCOUNT OF THE TENANT, ETC.

(3) REIMBURSEMENT TO MAINTENANCE FUND FOR MISCELLANEOUS LABOR (CRANE AND EQUIPMENT OPERATORS, ETC.) AND FUEL, ETC., FURNISHED FROM TIME TO TIME FOR ACCOUNT OF TENANT.

PAYMENT OF SUCH COSTS, FOR WHICH NO BUDGETARY PROVISION WAS MADE, OUT OF LIMITED MAINTENANCE BUDGET FUNDS WOULD EITHER BE IMPOSSIBLE OR WOULD DRASTICALLY REDUCE THE AMOUNT AND QUALITY OF THE MAINTENANCE, PRESERVATION AND SECURITY AFFORDED.

WITH RESPECT TO UTILITIES AT SHIPYARDS, IT IS STATED THAT ELECTRICAL ENERGY IS PURCHASED FROM LOCAL POWER COMPANIES BY THE COMMISSION FOR THEIR SHARE OF ENERGY CONSUMED. ALSO, IT IS STATED THAT SUCH ARRANGEMENT IS NECESSARY BECAUSE THE INSTALLATION WAS NOT LAID OUT SO THAT A PORTION OF THE YARDS COULD BE CONNECTED DIRECTLY TO THE LOCAL POWER LINES; THAT, AS A CONSEQUENCE, ALL POWER CHARGES ARE AN OBLIGATION AGAINST THE COMMISSION APPROPRIATION AND THAT, WITH A NUMBER OF TENANTS AT A YARD, IT WOULD BE DESIRABLE FOR THE COMMISSION TO RETAIN THE POWER CONTRACT AND BILL EACH LESSEE FOR THE PROPORTIONATE SHARE OF THE TOTAL BILLING. IT IS STATED FURTHER THAT SUCH A SITUATION WOULD ALSO BE TRUE AS REGARDS WATER SUPPLY. WITH RESPECT TO UTILITIES AT TERMINALS, THE MEMORANDUM STATES THAT, AT THE BOSTON AND NORFOLK TERMINALS, THE UTILITIES ARE FURNISHED TO THE TENANTS THROUGH THE DEPARTMENTS OF THE ARMY AND THE NAVY, RESPECTIVELY, BUT THAT THE SAID DEPARTMENTS BILL YOUR AGENCY FOR THE AMOUNTS INVOLVED WHICH ARE PAID FROM THE COMMISSION'S APPROPRIATION AND THEN COLLECTED FROM THE TENANTS, AND THAT, IN SUCH INSTANCES, THE MARITIME COMMISSION IS MERELY A COLLECTION AGENCY.

AS TO DAMAGE REPAIRS, THE MEMORANDUM STATES THAT, WHILE THE LEASES REQUIRE LESSEES TO REPAIR ALL DAMAGES, IT IS SOMETIMES MORE SATISFACTORY TO MAKE THE REPAIRS WITH COMMISSION FORCES AND BILL THE LESSEES. AS TO RENTAL OF THE EQUIPMENT, IT IS STATED THAT, AT SEVERAL TERMINALS AND SHIPYARDS, THE COMMISSION HAS CRANES OR OTHER EQUIPMENT WHICH THE LESSEES DESIRE TO HIRE OCCASIONALLY FOR SHORT PERIODS AND THAT IT HAS BEEN THE PRACTICE TO RENT SUCH EQUIPMENT WITH AN OPERATOR BECAUSE THE COMMISSION OPERATORS ARE MORE FAMILIAR THEREWITH.

YOU REQUEST A DECISION AS TO WHETHER AUTHORITY EXISTS UNDER THE APPROPRIATION FOR THE MARITIME COMMISSION AS CONTAINED IN THE INDEPENDENT OFFICERS APPROPRIATION ACT, 1948, PUBLIC LAW 269, 61 STAT. 603, OR OTHERWISE, TO ACCOMPLISH THAT WHICH IS SUMMARIZED IN THE AFORESAID MEMORANDUMS AS FOLLOWS:

1. UTILITIES--- AUTHORITY TO HOLD TENANT PAYMENTS FOR SAME IN A " SPECIAL FUND" AND REIMBURSE THE MAINTENANCE BUDGET FOR THE ACTUAL EXPENDITURE MADE THEREFROM FOR TENANTS ACCOUNT.

2. DAMAGE REPAIRS--- AUTHORITY TO HOLD TENANT PAYMENTS FOR SAME IN A " SPECIAL FUND" AND REIMBURSE THE MAINTENANCE BUDGET FOR THE ACTUAL COST OF LABOR AND MATERIAL. ELEMENT OF PROFIT IN THESE BILLINGS TO BE COVERED INTO MISCELLANEOUS RECEIPTS OF TREASURY.

3. MISCELLANEOUS EQUIPMENT RENTALS AND SERVICES--- AUTHORITY TO HOLD TENANT PAYMENT FOR SAME IN A " SPECIAL FUND" AND REIMBURSE THE MAINTENANCE BUDGET FOR THE ACTUAL COST OF LABOR, MATERIALS, SUPPLIES, AND FUEL. ELEMENT OF PROFIT IN THESE BILLINGS AS WELL AS INCOME FROM EQUIPMENT RENTAL, LESS FUEL, TO BE COVERED INTO MISCELLANEOUS RECEIPTS OF TREASURY.

THE INDEPENDENT OFFICES APPROPRIATION ACT, SUPRA, PROVIDES, IN PART, AS FOLLOWS:

THE CONSTRUCTION FUND ESTABLISHED BY THE MERCHANT MARINE ACT, 1936, SHALL BE AVAILABLE DURING THE FISCAL YEAR 1948 FOR ADMINISTRATIVE EXPENSES OF THE UNITED STATES MARITIME COMMISSION * * *: PROVIDED, THAT THE FOLLOWING LIMITATIONS SHALL APPLY TO OBLIGATIONS FROM SUCH FUND:

MAINTENANCE OF SHIPYARD FACILITIES, $800,000;

OPERATION OF WAREHOUSES, $849,180;

MAINTENANCE AND OPERATION OF TERMINALS, $561,000;

EXCEPT AS HEREINBEFORE PROVIDED NO OBLIGATION SHALL BE INCURRED AGAINST SUCH CONSTRUCTION FUND DURING THE FISCAL YEAR 1948 AND THE EXPENDITURES FROM SUCH FUND DURING THE FISCAL YEAR 1948 SHALL NOT EXCEED $208,206,774.

THE BALANCE OF SUCH FUND IN ADDITION TO SUCH AMOUNT OF $208,206,774, AS OF JUNE 30, 1947, SHALL BE CARRIED TO THE SURPLUS FUND AND COVERED INTO THE TREASURY. ALL RECEIPTS WHICH OTHERWISE WOULD BE DEPOSITED TO THE CREDIT OF SUCH CONSTRUCTION FUND DURING THE FISCAL YEAR 1948 SHALL BE COVERED INTO THE TREASURY AS MISCELLANEOUS RECEIPTS.

THE PROVISIONS OF THE SAID APPROPRIATION ACT ARE CLEAR AND UNAMBIGUOUS AND PROHIBIT EXPENDITURES FROM THE CONSTRUCTION FUND OF THE MARITIME COMMISSION DURING THE FISCAL YEAR 1948 IN EXCESS OF THE SUM OF $208,206,774, AND, ALSO, LIMIT THE OBLIGATIONS OF SUCH FUND FOR THE MAINTENANCE OF SHIPYARD FACILITIES, ETC., TO THE AMOUNTS SPECIFIED THEREIN. MOREOVER, ALL RECEIPTS WHICH OTHERWISE WOULD BE DEPOSITED TO THE CREDIT OF THE CONSTRUCTION FUND ARE, DURING THE FISCAL YEAR 1948, TO BE COVERED INTO THE TREASURY AS MISCELLANEOUS RECEIPTS.

THERE APPEARS TO BE NO QUESTION BUT THAT AMOUNTS PAID BY LESSEES FOR UTILITIES FURNISHED TO THEM AS WELL AS PAYMENTS ON ACCOUNT OF DAMAGE REPAIRS AND RENTAL OF EQUIPMENT CONSTITUTE RECEIPTS WHICH OTHERWISE WOULD BE DEPOSITED TO THE CONSTRUCTION FUND ESTABLISHED BY THE MERCHANT MARINE ACT OF 1936 (46 U.S.C. 1116) AND, UNDER THE PROVISIONS OF THE AFORESAID APPROPRIATION ACT, ARE REQUIRED DURING THE FISCAL YEAR 1948 TO BE DEPOSITED INTO THE TREASURY AS MISCELLANEOUS RECEIPTS. FURTHERMORE, THE PROPOSED PROCEDURE OBVIOUSLY WOULD RESULT IN THE INCURRENCE OF AN OBLIGATION AGAINST THE APPROPRIATION IN THE FIRST INSTANCE. THAT THE AMOUNT OF SUCH OBLIGATION SUBSEQUENTLY BY THE LESSEE WOULD HAVE NO EFFECT ON THE FACT THAT THE APPROPRIATION SO AS TO PERMIT THE INCURRENCE OF ADDITIONAL OBLIGATIONS WOULD INDIRECTLY INCREASE THE TOTAL AMOUNT OF OBLIGATIONS DURING THE FISCAL YEAR AND AUTHORIZE THAT WHICH WAS SPECIFICALLY PROHIBITED BY THE CONGRESS, THAT IS, THE INCURRENCE OF AN OBLIGATION OTHER THAN AUTHORIZED IN SAID ACT. HENCE, WHILE PAYMENTS OF THE AMOUNTS INVOLVED MAY, UNDER THE TERMS OF THE CONTEMPLATED LEASES, BE OBLIGATIONS OF THE TENANTS BUT, AS A RESULT OF THE SITUATION PREVAILING AT SHIPYARDS OR SOME TERMINALS AS OUTLINED ABOVE, OR BECAUSE OF ADMINISTRATIVE REASONS, ARE PAID BY THE COMMISSION IN THE FIRST INSTANCE SUBJECT TO REIMBURSEMENT BY THE TENANTS, SUCH FACTS ARE NOT CONSIDERED AS SUFFICIENT TO WARRANT DISREGARDING THE PLAIN TERMS OF THE APPROPRIATION ACT SO AS TO AUTHORIZE THE CREDIT OF SUCH PAYMENTS TO THE MAINTENANCE FUND INSTEAD OF DEPOSITING THE SAME INTO MISCELLANEOUS RECEIPTS.

IF FUNDS NECESSARY AND INCIDENT TO THE LEASING OF SHIPYARDS AND OTHER FACILITIES WERE NOT INCLUDED IN THE BUDGET ESTIMATES OF THE COMMISSION FOR THE FISCAL YEAR 1948 AND 1949, THE MATTER WOULD APPEAR TO BE ONE FOR PRESENTATION TO THE BUREAU OF THE BUDGET AND THE CONGRESS.