B-124786, DEC. 31, 1956

B-124786, DEC. 31, 1956

TO BRIGADIER GENERAL W. E. POTTER:

BY LETTER DATED JUNE 19, 1956, THE ACTING GOVERNOR OF THE CANAL ZONE REQUESTED OUR DECISION WHETHER THE VARIOUS DEPARTMENTS OF THE MILITARY ESTABLISHMENTS ARE REQUIRED BY SECTION 107 OF THE CIVIL FUNCTIONS APPROPRIATION ACT, 1955, 68 STAT. 335 TO REIMBURSE THE CANAL ZONE GOVERNMENT FOR THE UNRECOVERED COSTS OF EDUCATIONAL SERVICES FURNISHED BY YOUR GOVERNMENT IN THE CASE OF (A) SCHOOL-AGE DEPENDENTS OF OFFICERS IN THE MILITARY SERVICE OF LATIN AMERICAN COUNTRIES WHO ARE UTILIZED BY THE UNITED STATES ARMY AS MILITARY INSTRUCTORS IN LOCAL ARMY TRAINING PROGRAMS; (B) SCHOOL-AGE DEPENDENTS OF OFFICERS AND EMPLOYEES OF NAVY CONTRACTORS; (C) WIVES OF NAVY AND AIR FORCE PERSONNEL OR EMPLOYEES ATTENDING JUNIOR COLLEGE; AND (D) NAVY PERSONNEL ON ACTIVE DUTY ATTENDING JUNIOR COLLEGE. IT HAS BEEN NECESSARY TO DELAY OUR REPLY UNTIL WE COULD OBTAIN FULL INFORMATION CONCERNING THE MATTER.

SO FAR AS IS PERTINENT HERE, SECTION 107 OF THE CIVIL FUNCTIONS APPROPRIATION ACT, 1955, PROVIDES:

" * * * AMOUNTS EXPENDED BY THE CANAL ZONE GOVERNMENT FOR FURNISHING EDUCATION, AND HOSPITAL AND MEDICAL CARE TO EMPLOYEES OF AGENCIES OF THE UNITED STATES AND THEIR DEPENDENTS, OTHER THAN THE PANAMA CANAL COMPANY AND CANAL ZONE GOVERNMENT, LESS AMOUNTS PAYABLE BY SUCH EMPLOYEES AND THEIR DEPENDENTS HEREAFTER SHALL, NOTWITHSTANDING ANY OTHER PROVISION OF LAW, BE FULLY REIMBURSABLE TO THE CANAL ZONE GOVERNMENT BY SUCH AGENCIES. THE APPROPRIATION OR FUND OF ANY SUCH OTHER AGENCY BEARING THE COST OF THE COMPENSATION OF THE EMPLOYEE CONCERNED IS HEREBY MADE AVAILABLE FOR SUCH REIMBURSEMENTS.'

INFORMATION RECEIVED FROM THE DEPARTMENT OF DEFENSE INDICATES THAT THE LATIN AMERICAN OFFICERS IN CATEGORY (A) ARE ACTING AS INSTRUCTORS IN THE "USCARIB SCHOOL.' THEY DO NOT RECEIVE ANY COMPENSATION FROM THE UNITED STATES GOVERNMENT, BUT ARE PAID BY THEIR OWN GOVERNMENTS THE NORMAL PAY AND ALLOWANCES DUE THEM UNDER THE LAWS OF SUCH GOVERNMENTS. ARRANGEMENTS FOR THEIR SERVICES ARE MADE BY MEANS OF AN EXCHANGE OF LETTERS REQUESTING THE SERVICES AND AGREEING TO THE DETAIL OF THE INDIVIDUALS INVOLVED. APPEARS, THEREFORE, THAT SUCH OFFICERS ARE IN FACT NOT OFFICERS OR EMPLOYEES OF THE UNITED STATES, AND, MOREOVER, THAT NO APPROPRIATION MADE BY CONGRESS BEARS THE COST OF THEIR COMPENSATION.

WE UNDERSTAND THAT AT THE PRESENT TIME THERE ARE ONLY FOUR SUCH DEPENDENTS ATTENDING CANAL ZONE SCHOOLS AND THAT THE NUMBER HAS NEVER EXCEEDED SEVEN. WE ARE INFORMED, MOREOVER, THAT PAYMENTS MADE INDIVIDUALLY BY CERTAIN OF SUCH LATIN AMERICAN OFFICERS WERE REFUNDED BY YOUR GOVERNMENT, AND THAT PAYMENTS TENDERED BY OTHER OFFICERS WERE REFUSED.

AS WE POINTED OUT IN OUR LETTER TO YOU OF JANUARY 18, 1956, B 124786, THE ENACTMENT OF SECTION 107 RESULTED FROM THE ALARM OF THE MEMBERS OF THE COMMITTEE ON APPROPRIATIONS OF THE HOUSE OF REPRESENTATIVES AT THE EXTENT OF THE SUBSIDIZATION FURNISHED BY THE CANAL COMPANY TO OTHER GOVERNMENT AGENCIES IN THE ZONE. IT APPEARS TO HAVE BEEN THE INTENT OF THE COMMITTEE TO END SUCH SUBSIDIZATION AND TO REQUIRE THAT THE UNRECOVERED COSTS OF FURNISHING EDUCATIONAL SERVICES, AS WELL AS HOSPITAL AND MEDICAL SERVICES SHOULD BE BORNE BY THE USING AGENCIES. IN GIVING VOICE TO SUCH INTENT THE CONGRESS EMPLOYED LANGUAGE WHICH RESTRICTS THE APPLICATION OF THE STATUTE TO EMPLOYEES OF AGENCIES OF THE UNITED STATES AND THEIR DEPENDENTS. THE ABSENCE OF AN INDICATION IN THE STATUTE OR LEGISLATIVE HISTORY OF AN INTENTION TO COVER ADDITIONAL CLASSES OF PERSONS, WE CONCLUDE THAT MILITARY OFFICERS OF LATIN AMERICAN COUNTRIES CANNOT BE REGARDED AS "EMPLOYEES, WITHIN THE MEANING OF SECTION 107, EVEN THOUGH THEIR PRESENCE IN THE CANAL ZONE CLEARLY RELATES TO THE ACTIVITIES OF THE DEPARTMENT OF DEFENSE. ACCORDINGLY, IN OUR OPINION THE DEPARTMENT OF THE ARMY IS NOT REQUIRED TO REIMBURSE YOUR GOVERNMENT FOR THE UNRECOVERED COSTS OF PROVIDING EDUCATIONAL SERVICES TO THEIR SCHOOL-AGE DEPENDENTS.

FOR THE SAME REASONS, WE ARE ALSO OF THE OPINION THAT EMPLOYEES OF NAVY CONTRACTORS MENTIONED IN CATEGORY (B) ARE NOT "EMPLOYEES" OF THAT DEPARTMENT WITHIN THE MEANING OF THE STATUTE. THEREFORE, THE NAVY DEPARTMENT IS NOT REQUIRED TO REIMBURSE YOUR GOVERNMENT FOR THE UNRECOVERED COSTS OF THE EDUCATIONAL SERVICES FURNISHED TO SCHOOL-AGE DEPENDENTS OF OFFICERS AND EMPLOYEES OF NAVY CONTRACTORS.

ALTHOUGH IT APPEARS FROM THE LEGISLATIVE HISTORY OF SECTION 107 THAT THE FURNISHING OF EDUCATIONAL SERVICES BY YOUR GOVERNMENT WAS CONSIDERED BY THE COMMITTEE PRIMARILY FROM THE STANDPOINT OF THE NEEDS OF MINOR DEPENDENTS OF THE EMPLOYEES AND SERVICEMEN, THE PLAIN LANGUAGE OF THE STATUTE MAKES NO DISTINCTION ON THAT BASIS. ACCORDINGLY, WE HOLD, WITH REGARD TO CATEGORIES (C) AND (D), THAT THE VARIOUS FEDERAL AGENCIES CONCERNED ARE REQUIRED TO REIMBURSE THE CANAL ZONE GOVERNMENT FOR THE OTHERWISE UNRECOVERED COSTS OF EDUCATIONAL SERVICES FURNISHED TO WIVES OF CIVILIAN EMPLOYEES AND MILITARY PERSONNEL ON ACTIVE DUTY WHO ATTEND JUNIOR COLLEGE, AND ..END :