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B-161320, MAY 19, 1967, 46 COMP. GEN. 812

B-161320 May 19, 1967
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1967: THIS IS IN REPLY TO YOUR LETTER OF APRIL 19. SUCH REGULATIONS HAVE BEEN PRESCRIBED IN BUREAU OF THE BUDGET CIRCULAR NO. PERTINENT PROVISIONS OF THAT CIRCULAR ARE AS FOLLOWS: 4.1 CONDITIONS AND REQUIREMENTS UNDER WHICH ALLOWANCES MAY BE PAID. THE GOVERNMENT WILL REIMBURSE AN EMPLOYEE FOR EXPENSES REQUIRED TO BE PAID BY HIM IN CONNECTION WITH THE SALE OF ONE RESIDENCE AT HIS OLD OFFICIAL STATION * * * 4.2 REIMBURSABLE AND NON-REIMBURSABLE EXPENSES. A BROKER'S FEE OR REAL ESTATE COMMISSION PAID BY THE EMPLOYEE FOR SERVICES IN SELLING HIS RESIDENTS IS REIMBURSABLE BUT NOT IN EXCESS OF RATES GENERALLY CHARGED FOR SUCH SERVICES BY THE BROKER OR BY BROKERS IN THE LOCALITY OF THE OLD OFFICIAL STATION.

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B-161320, MAY 19, 1967, 46 COMP. GEN. 812

OFFICERS AND EMPLOYEES - TRANSFERS - RELOCATION EXPENSES - HOUSE SALE - ADVERTISING EXPENSES WHEN AN EMPLOYEE INCURS THE EXPENSE OF ADVERTISING A RESIDENCE AT HIS OLD OFFICIAL STATION THAT DOES NOT RESULT IN ITS SALE, THE RESIDENCE THEN BEING SOLD BY A BROKER WHOSE FEE INCLUDED AN ADVERTISING EXPENSE, THE EMPLOYEE MAY NOT BE ALLOWED THE ADVERTISING COSTS HE INCURRED, SECTION 4.2B OF BUREAU OF BUDGET CIRCULAR NO. A-56, IMPLEMENTING PUBLIC LAW 516, APPROVED JULY 21, 1966, PRECLUDING REIMBURSING THE EMPLOYEE FOR THE SEPARATE ADVERTISING EXPENSE.

TO DALE L. ROTHROCK, UNITED STATES DEPARTMENT OF THE INTERIOR, MAY 19, 1967:

THIS IS IN REPLY TO YOUR LETTER OF APRIL 19, 1967, WITH ENCLOSURES, REQUESTING A DECISION CONCERNING THE PROPRIETY OF CERTIFYING FOR PAYMENT A $74.26 ITEM APPEARING ON A RECLAIM VOUCHER SUBMITTED BY MR. CHARLES R. REND A, AN EMPLOYEE OF THE DEPARTMENT OF THE INTERIOR. THE ITEM REPRESENTS ADVERTISING EXPENSES INCURRED BY MR. REND A IN CONNECTION WITH HIS EFFORTS TO SELL HIS RESIDENCE AT HIS FORMER (OLD) OFFICIAL STATION.

MR. REND A INCURRED THE ADVERTISING COSTS IN QUESTION WHILE TRYING TO SELL HIS RESIDENCE HIMSELF WITHOUT PROCURING THE SERVICES OF A BROKER. HOWEVER, HIS ATTEMPTS TO DO SO PROVED UNSUCCESSFUL AND ULTIMATELY HE HAD TO PLACE THE HOUSE WITH A BROKER FOR DISPOSITION. THE BROKER'S FEE INCLUDED ADVERTISING EXPENSES INCURRED BY HIM IN SELLING THE HOUSE AND YOU INQUIRE AS TO WHETHER THE EARLIER ADVERTISING COSTS INCURRED BY MR. REND A WHICH DID NOT DIRECTLY RESULT IN THE SALE OF THE RESIDENCE NOW MAY BE ALLOWED.

SECTION 2 OF PUBLIC LAW 89-516, APPROVED JULY 21, 1966, 80 STAT. 323, 5 U.S.C. 5724A, AMENDED THE FORMER ADMINISTRATIVE EXPENSES ACT OF 1946 (60 STAT. 806) BY PROVIDING, AMONG OTHER THINGS, THAT UNDER SUCH REGULATIONS AS THE PRESIDENT MAY PRESCRIBE REIMBURSEMENT MAY BE MADE TO AN EMPLOYEE FOR COSTS INCURRED IN CONNECTION WITH THE SALE OF HIS RESIDENCE INCIDENT TO A CHANGE OF HIS OFFICIAL STATION. BY EXECUTIVE ORDER NO. 11290, DATED JULY 21, 1966, THE PRESIDENT DELEGATED HIS AUTHORITY TO PRESCRIBE SUCH REGULATIONS TO THE DIRECTOR, BUREAU OF THE BUDGET. SUCH REGULATIONS HAVE BEEN PRESCRIBED IN BUREAU OF THE BUDGET CIRCULAR NO. A-56, REVISED, OCTOBER 12, 1966. PERTINENT PROVISIONS OF THAT CIRCULAR ARE AS FOLLOWS:

4.1 CONDITIONS AND REQUIREMENTS UNDER WHICH ALLOWANCES MAY BE PAID. THE EXTENT ALLOWABLE UNDER THIS PROVISION, THE GOVERNMENT WILL REIMBURSE AN EMPLOYEE FOR EXPENSES REQUIRED TO BE PAID BY HIM IN CONNECTION WITH THE SALE OF ONE RESIDENCE AT HIS OLD OFFICIAL STATION * * *

4.2 REIMBURSABLE AND NON-REIMBURSABLE EXPENSES.

A. BROKER'S FEES AND REAL ESTATE COMMISSIONS. A BROKER'S FEE OR REAL ESTATE COMMISSION PAID BY THE EMPLOYEE FOR SERVICES IN SELLING HIS RESIDENTS IS REIMBURSABLE BUT NOT IN EXCESS OF RATES GENERALLY CHARGED FOR SUCH SERVICES BY THE BROKER OR BY BROKERS IN THE LOCALITY OF THE OLD OFFICIAL STATION. NO SUCH FEE OR COMMISSION IS REIMBURSABLE IN CONNECTION WITH THE PURCHASE OF A HOME AT THE NEW OFFICIAL STATION.

B. OTHER ADVERTISING AND SELLING EXPENSES. COSTS OF NEWSPAPER, BULLETIN BOARD, MULTIPLE-LISTING SERVICES, OR OTHER ADVERTISING FOR SALE OF THE RESIDENCE AT THE OLD OFFICIAL STATION ARE REIMBURSABLE IF THE EMPLOYEE HAS NOT PAID FOR SUCH SERVICES IN THE FORM OF A BROKER'S FEE OR REAL ESTATE AGENT'S COMMISSION. CUSTOMARY COSTS OF APPRAISAL ALSO MAY BE REIMBURSED.

MR. REND A PAID A BROKER'S FEE FOR THE SALE OF HIS RESIDENCE AT HIS OLD DUTY STATION AND WAS REIMBURSED THE AMOUNT OF SUCH FEE. IT IS NOT DISPUTED THAT THE BROKER'S FEE COVERED THE COSTS INCURRED BY THE BROKER FOR ADVERTISING. IT IS OUR VIEW THAT SECTION 4.2B, QUOTED ABOVE, DOES NOT PERMIT REIMBURSEMENT OF COSTS INCURRED FOR SEPARATE ADVERTISING WHEN THE EMPLOYEE IS BEING REIMBURSED FOR ADVERTISING COSTS AS A PART OF A BROKER'S FEE OR REAL ESTATE AGENT'S COMMISSION.

THEREFORE, THE ITEM FOR $74.26 FOR ADVERTISING COSTS, ON THE VOUCHER, WHICH IS RETURNED HEREWITH, SHOULD NOT BE INCLUDED IN YOUR CERTIFICATION FOR PAYMENT.

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