B-121558, JUL. 29, 1955

B-121558, JUL. 29, 1955

TO BRIGADIER GENERAL J. S. SEYBOLD, GOVERNOR OF THE CANAL ZONE:

REFERENCE IS MADE TO YOUR LETTER OF JANUARY 31, 1955, REQUESTING RECONSIDERATION OF DECISION TO THE SECRETARY OF THE NAVY DATED DECEMBER 16, 1954, B-121158, 34 COMP. GEN. 292, IN WHICH IT WAS HELD THAT APPROPRIATIONS MADE TO THE DEPARTMENT OF THE NAVY ARE NOT AVAILABLE TO PAY CANAL ZONE GOVERNMENT POSTAGE ON PENALTY MAIL DEPOSITED IN CANAL ZONE POST OFFICES.

THE QUESTION CONSIDERED IN THE DECISION OF DECEMBER 16, 1954, INVOLVED A PROPOSED EXPENDITURE OF DEPARTMENT OF THE NAVY FUNDS TO COMPLY WITH AN AMENDMENT OF CANAL ZONE POSTAL REGULATIONS DATED AUGUST 27, 1954, DECLARING PENALTY INDICIA UNACCEPTABLE AND REQUIRING ALL EXECUTIVE DEPARTMENTS AND AGENCIES OF THE GOVERNMENT TO PREPAY POSTAGE ON SUCH OFFICIAL MATTER MAILED IN CANAL ZONE POST OFFICES EFFECTIVE OCTOBER 1, 1954. SUCH DECISION--- RENDERED TO AND INVOLVING THE AVAILABILITY OF FUNDS OF ANOTHER DEPARTMENT--- ORDINARILY MAY NOT BE RECONSIDERED AT YOUR REQUEST. 31 U.S.C. 74; 16 COMP. GEN. 927, 929; 18 ID. 217; 32 ID. 179. HOWEVER, SINCE THE EXPENDITURE OF CANAL ZONE GOVERNMENT FUNDS FOR HANDLING PENALTY MAIL DEPOSITED IN CANAL ZONE POST OFFICES BY GOVERNMENT AGENCIES ALSO IS INVOLVED, AND IN VIEW OF YOUR REPRESENTATION THAT THE CANAL ZONE GOVERNMENT HAS NOT HAD FULL OPPORTUNITY TO MAKE A FORMAL PRESENTATION OF ITS VIEWS ON THE MATTER, THE SAID DECISION WILL BE RECONSIDERED.

THE CONCLUSION REACHED IN THE CITED DECISION WAS BASED TO A MATERIAL EXTENT ON TWO REASONS. FIRST, IT WAS CONSIDERED THAT UNDER THE PROVISIONS OF SECTION 5 OF THE ACT OF MARCH 3, 1877, 19 STAT. 335, AS AMENDED, 39 U.S.C. 321, PROVIDING FOR THE TRANSMISSION OF OFFICIAL MAIL FREE OF POSTAGE, FEDERAL AGENCIES ARE ENTITLED TO THE FREE TRANSMISSION OF OFFICIAL PENALTY MAIL DEPOSITED IN CANAL ZONE POST OFFICES. SECOND, IT WAS REASONED THAT DEPARTMENT OF THE NAVY APPROPRIATIONS ARE NOT AVAILABLE TO PAY CANAL ZONE GOVERNMENT POSTAGE ON SUCH MAIL IN VIEWOF THE GENERAL RULE THAT PAYMENT FOR SERVICES RENDERED BY ONE AGENCY OF THE GOVERNMENT FOR ANOTHER IS NOT AUTHORIZED WHERE THE SERVICES PERTAINING TO IT ARE REQUIRED BY LAW IN CARRYING OUT THE NORMAL FUNCTIONS OF THE PERFORMING AGENCY AND FOR WHICH APPROPRIATIONS ARE SPECIFICALLY PROVIDED.

THE CRUX OF YOUR CONTENTION IS THAT THE CHANGE IN THE CANAL ZONE POSTAL REGULATIONS TO REQUIRE THE PREPAYMENT OF POSTAGE ON PENALTY MAIL IS AUTHORIZED BY THE PROVISIONS OF SECTION 271, TITLE 2 OF THE CANAL ZONE CODE, AS AMENDED BY SECTION 2 OF THE ACT OF JUNE 13, 1940, 54 STAT. 389. THE PERTINENT PROVISIONS OF SAID SECTION 271, AS AMENDED, WHICH ARE QUOTED IN YOUR LETTER, ARE AS FOLLOWS:

"271. MAINTENANCE AND OPERATION OF THE CANAL ZONE POSTAL SERVICE.- - THE POSTAL SERVICE OF THE CANAL ZONE SHALL BE GOVERNED, EXCEPT AS OTHERWISE PROVIDED IN THE CANAL ZONE CODE, BY SUCH OF THE LAWS, RULES, REGULATIONS, AND CONVENTIONS OF THE POSTAL SERVICE OF THE UNITED STATES AS BY THEIR TERMS APPLY IN THE CANAL ZONE AND BY SUCH ADDITIONAL LAWS, RULES, AND REGULATIONS OF THE POSTAL SERVICE OF THE UNITED STATES AS THE GOVERNOR OF THE PANAMA CANAL SHALL BY REGULATION DETERMINE TO BE APPLICABLE TO CONDITIONS EXISTING IN THE CANAL ZONE. THE GOVERNOR MAY PRESCRIBE SUCH ADDITIONAL RULES AND REGULATIONS AS ARE NECESSARY FOR THE MAINTENANCE AND OPERATION OF THE CANAL ZONE POSTAL SERVICE.

"THE GOVERNOR OF THE PANAMA CANAL IS AUTHORIZED---

"C. TO PRESCRIBE THE POSTAGE RATES:PROVIDED, HOWEVER, THAT THE UNITED STATES DOMESTIC POSTAGE RATES SHALL BE APPLICABLE TO REGULAR MAIL EXCHANGED WITH THE UNITED STATES; * * *"

YOU STATE THAT THE QUOTED SECTION 271C DID NOT APPEAR IN THE AMENDED ACT OF FEBRUARY 16, 1933, 47 STAT. 812, AND, THEREFORE, CONCLUDE THAT IT GIVES SUPPORT TO THE CONTENTION THAT "FULL AUTHORITY FOR THE FIXING OF POSTAGE RATES, WITH THE ONE SPECIFIC EXCEPTION, IS NOW VESTED IN THE GOVERNOR.' YOU ALSO CONTEND THAT THE GOVERNOR IS AUTHORIZED BY THE PROVISIONS OF THE QUOTED SECTION 271 TO ADOPT BY REGULATION THE CITED 1877 STATUTE AND THE ACT OF AUGUST 15, 1953, 67 STAT. 614, AMENDING THE PENALTY MAIL ACT OF 1948, IN ORDER TO PERMIT, AS PROVIDED FOR BY THE 1953 CCT, THE RECOVERY OF FUNDS FROM GOVERNMENT AGENCIES IN LIEU OF POSTAGE. YOU POINT OUT, HOWEVER, THAT THE CHANGE IN THE CANAL ZONE POSTAL REGULATIONS IS NOT AN APPLICATION OF THE 1877 OR 1953 STATUTES BUT, INSTEAD, RESTS UPON THE PROVISIONS OF SAID SECTION 271C.

IN THE DECISION OF DECEMBER 16, 1954, THERE WERE FULLY CONSIDERED THE QUOTED CODE PROVISIONS AND, AS INDICATED THEREIN, IT IS CONCEDED THAT SUCH PROVISIONS GIVE TO THE GOVERNOR OF THE CANAL ZONE WIDE DISCRETION AS TO THE POSTAGE RATES, LAWS, RULES, AND REGULATIONS RELATING TO THE OPERATION OF THE CANAL ZONE POSTAL SERVICE. HOWEVER, SUCH AUTHORITY MUST BE CONSTRUED CONSISTENTLY WITH OTHER PERTINENT STATUTES AND WITH DUE CONSIDERATION FOR THE RIGHTS CONFERRED THEREIN UPON OTHER AGENCIES OF THE GOVERNMENT. IN THAT CONNECTION, THE FOLLOWING EXCERPT FROM THE DECISION OF THE SUPREME COURT IN GLAVEY V. UNITED STATES, 182 U.S. 595, 605, SEEMS APPOSITE:

"* * * THE AUTHORITY OF THE SECRETARY (OF THE NAVY) TO ISSUE ORDERS, REGULATIONS AND INSTRUCTIONS, WITH THE APPROVAL OF THE PRESIDENT, IN REFERENCE TO MATTERS CONNECTED WITH THE NAVAL ESTABLISHMENT, IS SUBJECT TO THE CONDITION, NECESSARILY IMPLIED, THAT THEY MUST BE CONSISTENT WITH THE STATUTES WHICH HAVE BEEN ENACTED BY CONGRESS IN REFERENCE TO THE NAVY. MAY, WITH THE APPROVAL OF THE PRESIDENT, ESTABLISH REGULATIONS IN EXECUTION OF, OR SUPPLEMENTAL TO, BUT NOT IN CONFLICT WITH, THE STATUTES DEFINING HIS POWERS OR CONFERRING RIGHTS UPON OTHERS. THE CONTRARY HAS NEVER BEEN HELD BY THIS COURT. * * *"

IT SEEMS CLEAR THAT THE 1877 STATUTE VESTED SUBSTANTIVE RIGHTS IN THE DEPARTMENTS AND AGENCIES OF THE GOVERNMENT TO THE TRANSMISSION OF THEIR OFFICIAL MAIL MATTER FREE OF CHARGE, AND YOU ADMIT IN YOUR LETTER THAT SUCH RIGHTS EXTEND TO THE CANAL ZONE POSTAL SERVICE. THAT STATUTE HAS NOT BEEN REPEALED. SECTION 1 OF THE ACT OF AUGUST 15, 1953, 67 STAT. 614, ADDED TO SECTION 301 OF THE PENALTY MAIL ACT OF 1948, 62 STAT. 1048, A PROVISION REQUIRING PAYMENT TO THE POST OFFICE DEPARTMENT BY FEDERAL AGENCIES OF THE POSTAL CHARGES INCIDENT TO HANDLING THEIR MAIL. THE EFFECT OF THE STATUTE, AS AMENDED, MERELY OPERATED TO SUSPEND THE RIGHTS OF FEDERAL AGENCIES TO FREE TRANSMISSION OF MAIL, BUT--- AS POINTED OUT IN THE DECISION OF DECEMBER 16, 1954--- ONLY MAIL HANDLED BY THE POST OFFICE DEPARTMENT.

CLEARLY, NO LANGUAGE IN THE QUOTED CODE PROVISIONS, EITHER EXPRESS OR IMPLIED, MAY BE REGARDED AS GIVING IT THE EFFECT OF AUTHORIZING THE GOVERNOR OF THE CANAL ZONE BY REGULATION OR OTHERWISE TO TERMINATE THE RIGHTS CONFERRED UPON FEDERAL AGENCIES BY THE 1877 STATUTE FOR FREE MAILING OF OFFICIAL MATTER IN CANAL ZONE POST OFFICES. ALSO, THERE IS NOTHING IN THE LEGISLATIVE HISTORY OF THE ACT OF JUNE 13, 1940, FROM WHICH IT REASONABLY MAY BE CONCLUDED THAT THE CONGRESS HAD ANY INTENTION THAT IT SHOULD BE ACCORDED SUCH EFFECT.

ACCORDINGLY, YOU ARE ADVISED THAT THERE APPEARS NO PROPER BASIS FOR MODIFYING THE DECISION OF DECEMBER 16, 1954.

YOU REQUEST ALSO TO BE ADVISED, IN THE EVENT IT IS HELD THAT THE SUBJECT DECISION MAY NOT BE MODIFIED, REGARDING YOUR AUTHORITY TO APPLY, BY REGULATION, THE CITED PENALTY MAIL ACT OF 1948, AS AMENDED, WITH SUCH ADAPTATION AS IS NECESSARY TO PROVIDE THAT REVENUES RECEIVED WOULD BE THOSE OF THE CANAL ZONE GOVERNMENT.

IN VIEW OF WHAT IS HEREINABOVE STATED REGARDING THE RIGHTS OF GOVERNMENT AGENCIES TO THE FREE TRANSMISSION OF MAIL DEPOSITED IN CANAL ZONE POST OFFICES, AND HAVING REGARD FOR THE GENERAL RULE ALSO REFERRED TO HEREIN, AND ALSO THE PROVISO IN THE CIVIL FUNCTIONS APPROPRIATION ACT, 1954, 67 STAT. 197, 200, UNDER THE APPROPRIATION "OPERATING EXPENSES, CANAL ZONE GOVERNMENT" REQUIRING THE PAYMENT OF ALL CANAL ZONE POSTAL REVENUES INTO MISCELLANEOUS RECEIPTS OF THE TREASURY, IT MUST BE CONCLUDED THAT THE APPLICATION OF THE PAYMENT PROVISIONS OF THE PENALTY MAIL ACT OF 1948, AS AMENDED, AND THE USE OF REVENUES DERIVED THEREUNDER TO THE CANAL ZONE GOVERNMENT MAY BE EFFECTED ONLY BY SPECIFIC AUTHORITY OF THE CONGRESS.