Request for Real Estate Expenses

B-195264: Feb 12, 1980

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Shirley Jones
(202) 512-8156
jonessa@gao.gov

 

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An advance decision was requested as to whether payment of a voucher for reimbursement of real estate expenses submitted by an employee of the Army Corps of Engineers would be proper. The claimant was issued orders for a permanent change of duty station from Louisiana to Virginia on August 16, 1976. He reported for duty in Virginia on August 16, 1976. On December 13, 1977, he was issued travel orders for a transfer to Saudi Arabia. On December 14, 1977, he requested an extension of time to purchase a house in connection with his transfer to Virginia, stating that he would be returning to Virginia after his tour of duty in Saudi Arabia. The extension was granted on January 25, 1978. The claimant reported for duty in Saudi Arabia on February 7, 1978. On August 1, 1978, he purchased two adjacent two-bedroom townhouses in Virginia which he intended to convert into one four-bedroom townhouse. The finance officer questioned whether the claimant was entitled to payment in light of the fact that he purchased the residences after being informed of his overseas transfer. The applicable regulations permit the period within which compensation for real estate expenses will be reimbursed to be extended from one year to two years if the transaction can be shown to be related to the transfer. The determination by an agency to grant such an extension will not be disturbed unless found to be arbitrary and capricious. Although the claimant was being transferred at the time the extension was granted, his transfer was to an overseas location with no entitlement to real estate expenses upon return. Regarding the purchase of two townhouses, the regulations restrict reimbursement to the costs of purchasing one dwelling only; the fact that the claimant intended to convert them at some time into a single dwelling does not affect this restriction. Accordingly, payment was permitted for the expenses incurred in purchasing one of the townhouses.