B-168476, JAN. 19, 1970

B-168476, JAN. 19, 1970

CIVIL PAY--TRANSFERS--REAL ESTATE EXPENSES DECISION TO CERTIFYING OFFICER OF FOREST SERVICE CONCERNING RECLAIM VOUCHER FOR CERTAIN REAL ESTATE EXPENSES INCIDENT TO PURCHASE OF HOME AT NEW OFFICIAL STATION. EMPLOYEE WHO, INCIDENT TO TRANSFER ON JUNE 6, 1969, RECEIVED LOAN FOR HOME, ALTHOUGH LOAN SETTLEMENT DATE WAS NOT UNTIL A MONTH AFTER THE EFFECTIVE DATE WHEN LOAN ORIGINATION FEES WERE NO LONGER REIMBURSABLE ITEM MAY HAVE TRANSACTION CONSIDERED AS PRIOR TO JULY 1, 1969 AND THEREFORE EMPLOYEE MAY BE PAID FOR LOAN ORIGINATION FEE.

TO MR. PAUL J. GRAINGER:

WE REFER TO YOUR LETTER OF NOVEMBER 12, 1969, YOUR REFERENCE 6540, IN WHICH YOU REQUESTED OUR ADVANCE DECISION AS TO THE PROPRIETY OF CERTIFYING FOR PAYMENT THE RECLAIM VOUCHER OF MR. DAVID R. W. HOEFER COVERING SUSPENSION OF CERTAIN REAL ESTATE EXPENSES.

THE RECORD SHOWS THAT MR. HOEFER ENTERED INTO A CONTRACT FOR THE PURCHASE OF A RESIDENCE AT HIS NEW OFFICIAL STATION ON JUNE 6, 1969. THIS CONTRACT WAS SUBJECT TO THE PURCHASER'S ABILITY TO OBTAIN A LOAN FOR THE PURPOSE OF FINANCING THE PURCHASE ON OR BEFORE JUNE 11, 1969, AND THE CLOSING OF THE PURCHASE WAS TO BE HELD ON OR BEFORE JUNE 20, 1969.

THE RECORD CONTAINS A LETTER DATED OCTOBER 14, 1969, FROM THE ROUTT COUNTY FEDERAL SAVINGS AND LOAN ASSOCIATION, THE INSTITUTION WHICH MADE THE LOAN TO MR. HOEFER, WHEREIN IT IS STATED THAT "* * * THE DATE OF JUNE 12, 1969, WAS THE DATE WE MADE THE LOAN AND DISBURSED THE MONEY, AND WITHHELD A CERTAIN AMOUNT TO PAY THE ATTORNEY FEES AND OTHER EXPENSES." THE LOAN SETTLEMENT SHEET WHICH IS DATED JULY 30, 1969, ALSO INDICATES THAT THE LOAN WAS MADE ON JUNE 12, 1969, AND THAT INTEREST ON THE LOAN STARTED TO RUN FROM THAT DATE ON.ALSO, THE PROPERTY WAS TRANSFERRED BY DEED TO MR. HOEFER ON JUNE 24, 1969. THE DEED WAS RECORDED ON JUNE 30, 1969.

IN VIEW OF THE REVISION OF BUREAU OF THE BUDGET CIRCULAR NO. A-56BY TRANSMITTAL MEMORANDUM NO. 5, DATED JUNE 26, 1969, WHICH REMOVED THE LENDER'S LOAN ORIGINATION FEE FROM THE LIST OF REIMBURSABLE REAL ESTATE EXPENSES, YOU ASK WHETHER OR NOT THE AMOUNT OF $215 WHICH IS CLAIMED BY THE EMPLOYEE AND WHICH HE PAID TO THE LENDER IS REIMBURSABLE UNDER THE CIRCUMSTANCES.

WE HAVE HELD ON NUMEROUS OCCASIONS THAT THE CONTROLLING FACT IN RESOLVING CLAIMS OF THIS NATURE IS THE DATE ON WHICH THE ACTUAL EXPENSES ARE INCURRED. SEE 47 COMP. GEN. 582 (1968), B-168011, OCTOBER 24, 1969, AND B -168459, DECEMBER 30, 1969. ALSO, WE HAVE HELD THAT THE DELETION OF THE LOAN ORIGINATION FEE AS ONE OF THE REIMBURSABLE ITEMS WAS NOT EFFECTIVE UNTIL JULY 1, 1969, EVEN THOUGH GENERALLY THE REVISIONS ARE STATED TO BE EFFECTIVE JUNE 26, 1969. SEE B-168065, NOVEMBER 19, 1969.

SINCE THE TRANSACTIONS PREVIOUSLY REFERRED TO OCCURRED PRIOR TO JULY 1, 1969, WE CONCLUDE THAT THE AMOUNT PAID BY THE EMPLOYEE FOR THE LOAN ORIGINATION FEE IS A REIMBURSABLE EXPENSE AND MAY BE ALLOWED.

A PORTION OF THE EMPLOYEE'S CLAIM IS FOR THE REIMBURSEMENT OF EXPENSES WHICH HE INCURRED AS A RESULT OF HIS TRANSFERRING THE PROPERTY FROM A SOLE OWNERSHIP TO A JOINT OWNERSHIP WITH HIS WIFE. IT APPEARS FROM THE RECORD THAT WHEN THE ORIGINAL TRANSFER OF THE PROPERTY, FROM THE SELLERS TO THE EMPLOYEE, TOOK PLACE THE EMPLOYEE'S WIFE WAS UNABLE TO ATTEND THE CLOSING OF THE SALE AND THE DEED WAS TRANSFERRED TO THE EMPLOYEE ALONE. ON JUNE 25, 1969, THE EMPLOYEE TRANSFERRED THE PROPERTY BY A QUIT CLAIM DEED TO HIMSELF AND HIS WIFE, AS JOINT TENANTS, AND INCURRED THE ADDITIONAL EXPENSE OF $10 FOR DRAWING THE DEED AND $1.75 FOR RECORDING IT. THESE ITEMS WERE NOT ALLOWED BECAUSE THEY WERE NOT INCURRED AS PART OF A CUSTOMARY TRANSACTION. IT ALSO APPEARS THAT THE ITEMS OF $50 AND $5 FOR CLOSING FEE AND CONFERENCE WERE DENIED BECAUSE SUCH FEES APPEARED TO BE FOR ADVISORY SERVICES WHICH ARE NOT REIMBURSABLE IN ACCORDANCE WITH OUR PREVIOUS DECISIONS, B-161891, AUGUST 21, 1967, AND B-162858, DECEMBER 5, 1967. WE AGREE THAT THESE FOUR ITEMS WERE PROPERLY FOR DEDUCTION.

ACCORDINGLY, THE RECLAIM VOUCHER IS RETURNED HEREWITH FOR FURTHER PROCESSING CONSISTENT WITH THE ABOVE.