A-66072, OCTOBER 22, 1935, 15 COMP. GEN. 325

A-66072, OCTOBER 22, 1935, 15 COMP. GEN. 325

DESTROYED TUBERCULOUS CATTLE - FEDERAL INDEMNITY PAYMENTS AMENDMENTS TO REGULATIONS PRESCRIBED BY THE SECRETARY OF AGRICULTURE IN CONNECTION WITH FEDERAL INDEMNITY PAYMENTS FOR DESTROYED TUBERCULOUS CATTLE UNDER SECTION 6 OF THE ACT OF APRIL 7, 1934, 48 STAT. 528, MAY NOT OPERATE RETROACTIVELY. (MODIFIED BY 15 COMP. GEN. 536.)

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF AGRICULTURE, OCTOBER 22, 1935:

THERE HAS BEEN RECEIVED YOUR LETTER OF OCTOBER 3, 1935, AS FOLLOWS:

THE DEPARTMENT IS VERY MUCH DISTURBED WITH RESPECT TO YOUR ACTION IN THE SETTLEMENT OF THE INDEMNITY CLAIM OF NINA J. HAZELTON, CERTIFICATE NO. 0373318, DATED SEPTEMBER 16, 1935, AND RECENTLY RECEIVED, INVOLVING PAYMENT OF THE DIFFERENCE BETWEEN THE APPRAISED VALUE AND THE SALVAGE OF 16 CATTLE. COPY OF THIS CERTIFICATE IS INCLOSED, AND IT WOULD BE VERY GREATLY APPRECIATED IF THE MATTER BE RECONSIDERED.

IN THE FIRST PLACE, IT MAY BE POINTED OUT THAT SECTION 6 OF THE ACT OF APRIL 7, 1934 (48 STAT. 528), UNDER WHICH B.A.I. ORDER 344 WAS PROMULGATED, DOES NOT REQUIRE THE STATES TO MAKE ANY CONTRIBUTORY PAYMENT AS A BASIS FOR FEDERAL PAYMENT, WHEREAS THE REGULAR APPROPRIATION ACT UNDER WHICH B.A.I. ORDER 329 WAS PROMULGATED DOES MAKE SUCH REQUIREMENT. THE ACT OF APRIL 7, 1934, AUTHORIZES THE SECRETARY TO MAKE PAYMENTS FOR CATTLE SUFFERING FROM TUBERCULOSIS OR BANG'S DISEASE "UNDER RULES AND REGULATIONS PROMULGATED BY HIM AND UPON SUCH TERMS AS HE MAY PRESCRIBE.' IT WAS UNDER THIS AUTHORITY THAT B.A.I. ORDER 344 AND AMENDMENT 1 THERETO WERE ISSUED.

WHEN THE EMERGENCY FUNDS BECAME AVAILABLE UNDER THE ACT OF APRIL 7, 1934, AND FEDERAL PAYMENT WAS TO BE MADE FROM THEM FOR DESTROYED TUBERCULOUS CATTLE, IT WAS NECESSARY TO PREPARE AN ORDER COVERING THE METHOD OF PAYMENT, AND B.A.I. ORDER 344 WAS ISSUED AND BECAME EFFECTIVE ON JUNE 12, 1934. IN THE PREPARATION OF THIS ORDER, THE QUESTION OF A LIMITATION FOR THE FEDERAL PAYMENT, OTHER THAN THE MAXIMUM OF $20 FOR GRADE CATTLE AND $50 FOR PUREBRED CATTLE, WAS GIVEN MUCH CONSIDERATION, AND IT WAS DECIDED THAT IN ORDER TO BE CONSISTENT THE OWNER SHOULD NOT RECEIVE FROM ALL SOURCES, INCLUDING STATE OR COUNTY PAYMENTS AND SALVAGE, IN ADDITION TO THE FEDERAL PAYMENT, ANY MORE THAN THIS OWNER WOULD RECEIVE FOR THE SAME CATTLE IF THE CLAIM SHOULD HAVE BEEN COMPUTED UNDER THE PROVISIONS OF B.A.I. ORDER 329, AS IT STILL MIGHT BE. (B.A.I. ORDER 329 BEING USED AS A BASIS FOR COMPUTING UNDER B.A.I. ORDER 344.) THEREFORE, IN THE PREPARATION OF CLAIMS FOR FEDERAL PAYMENT FOR TUBERCULOUS CATTLE, TO BE PRESENTED IN ACCORDANCE WITH THE PROVISIONS OF B.A.I. ORDER 344, IT WOULD BE NECESSARY TO DETERMINE HOW MUCH THE OWNER MIGHT HAVE RECEIVED FROM ALL SOURCES, IN CASE THE CLAIM WAS TO BE HANDLED UNDER B.A.I. ORDER 329. THIS WAS FELT TO BE NECESSARY IN ORDER TO MAKE THE PAYMENTS CONSISTENT WITH THE PLAN PREVAILING UNDER B.A.I. ORDER 329.

IT WAS THE PURPOSE OF THE REGULATION TO PROVIDE FOR A FEDERAL PAYMENT IN CASES WHERE INSUFFICIENT STATE FUNDS WERE AVAILABLE MAKING IT POSSIBLE TO CONDUCT THE ERADICATION OF TUBERCULOSIS IN CATTLE MUCH MORE RAPIDLY. THE DEPARTMENT AND THE INTERESTED CATTLE OWNERS HAD NO DOUBT AS TO THE ABILITY OF THE FEDERAL GOVERNMENT TO PAY ALL OR A PART OF THE AMOUNT PREVIOUSLY PAID BY THE COOPERATING STATE, TERRITORY, OR COUNTY UNDER THIS REGULATION. THE FEDERAL PAYMENT WOULD INCLUDE PART OR IN SOME CASES ALL THAT THE STATE WOULD PAY IF THE WORK WAS CARRIED ON AS IT WAS PRIOR TO THE TIME THE EMERGENCY FUNDS BECAME AVAILABLE, WITH THE LIMITATION, HOWEVER, THAT THE AMOUNT TO BE PAID BY THE FEDERAL GOVERNMENT COULD NOT EXCEED $20 FOR GRADE CATTLE AND $50 FOR PUREBRED CATTLE AND THAT, AS ABOVE INDICATED, THE TOTAL AMOUNT RECEIVED BY THE OWNER FROM ALL SOURCES COULD NOT EXCEED THE TOTAL AMOUNT THAT WOULD HAVE BEEN RECEIVED IF THE CLAIM HAD BEEN COMPUTED PURSUANT TO THE PROVISIONS OF B.A.I. ORDER 329.

IT WAS LATER FOUND NECESSARY TO AMEND B.A.I. ORDER 344 SO AS TO PROVIDE THAT FEDERAL PAYMENTS FOR TUBERCULOUS CATTLE WOULD BE MADE IN STATES OR TERRITORIES WHERE THERE WAS NO AUTHORITY FOR STATE OR TERRITORY PAYMENTS, AND THIS WAS DONE BY AMENDMENT NO. 1, EFFECTIVE MARCH 19, 1935. THE PURPOSE OF SAID AMENDMENT NO. 1 TO B.A.I. ORDER 344 WAS TO PROVIDE FOR PAYMENT OF WHAT WAS BELIEVED TO BE A FAIR AND EQUITABLE AMOUNT FOR SLAUGHTERED ANIMALS IN ALL CASES WHERE THE STATE OR TERRITORY MADE NO PAYMENT BECAUSE OF LACK OF AUTHORITY. THE DEPARTMENT BELIEVED THAT IF THE AMENDMENT WAS SO FRAMED ALL SUCH CASES WOULD BE COVERED, THE INTENTION BEING TO PROVIDE THAT, IN ALL CASES WHERE THE STATE OR TERRITORY HAD NO AUTHORITY TO MAKE A PAYMENT, THE FEDERAL PAYMENT SHOULD NOT BE WITHHELD, BUT IN SUCH EVENT THE FEDERAL PAYMENT SHOULD NOT EXCEED "TWO-THIRDS OF THE DIFFERENCE BETWEEN THE APPRAISED VALUE AND THE NET SALVAGE.' IT WAS BELIEVED THAT A PROVISION OF THIS KIND WOULD PROVIDE A FAIRLY EQUITABLE ARRANGEMENT IN ALL SUCH CASES.

THE DIFFICULTY ENCOUNTERED IN THE PRESENT CASE IS SIMILAR TO THE DIFFICULTY THAT AROSE IN CONNECTION WITH THE CIRCUMSTANCE COVERED IN THE PREVIOUS PARAGRAPH AND WHICH RESULTED IN YOUR DECISION CONTAINED IN A- 60347. IT WILL BE NOTED, FROM THE FOREGOING STATEMENTS, THAT IT WAS THE DESIRE OF THIS DEPARTMENT TO MAKE FEDERAL PAYMENT WHEN NO PAYMENT WAS TO BE MADE BY THE COOPERATING STATE, AND ALSO THAT THE CATTLE OWNER WOULD RECEIVE FROM ALL SOURCES, INCLUDING STATE AND FEDERAL PAYMENT AND SALVAGE, NOT MORE THAN HE WOULD HAVE RECEIVED IN THE EVENT THAT HIS CLAIM WAS COMPUTED UNDER THE PROVISIONS OF B.A.I. ORDER 329 OR ANY AMENDMENT THERETO. THE DEPARTMENT BELIEVED THAT IT WAS ADVISABLE TO FOLLOW THE PLAN OF COMPENSATING OWNERS OF CONDEMNED TUBERCULOUS CATTLE THAT OBTAINED IN B.A.I. ORDER 329 AND ITS AMENDMENTS, TO MAINTAIN UNIFORMITY, EXCEPT THAT, AS PREVIOUSLY INDICATED, A PAYMENT BY COOPERATING AGENCIES WOULD NOT BE REQUIRED.

FEDERAL CLAIMS PAID FOR TUBERCULOUS CATTLE FROM THE EMERGENCY FUNDS SINCE JUNE 12, 1934, HAVE BEEN CERTIFIED FOR PAYMENT IN AN AMOUNT OF APPROXIMATELY $5,000,000. THESE CLAIMS HAVE BEEN COMPUTED UNDER THE PROVISIONS OF B.A.I. ORDER 344 AND ANY AMENDMENTS THERETO, AND PRIOR TO SEPTEMBER 16, 1935, NO EXCEPTION HAS BEEN TAKEN TO THE FACT THAT THE FEDERAL PAYMENT EXCEEDED THE AMOUNT PAID TO THE OWNER BY THE COOPERATING STATE WHERE AUTHORITY FOR STATE PAYMENT EXISTED.

THERE ARE A LARGE NUMBER OF CLAIMS FOR TUBERCULOUS CATTLE NOW PENDING TO BE PAID FROM THE SAME EMERGENCY FUNDS AND IT IS THEREFORE URGENTLY REQUESTED THAT ACTION BE TAKEN AT THE EARLIEST POSSIBLE DATE TO ALLOW THEM TO BE AUDITED AND CERTIFIED FOR PAYMENT IN ACCORDANCE WITH THE ACTUAL INTENT OF B.A.I. ORDER 344 AND ITS AMENDMENTS, IF OTHERWISE CORRECT.

IN VIEW OF THE FACT THAT THE LANGUAGE USED IN SECTION 1 OF REGULATION 3, B.A.I. ORDER 344, DOES NOT SEEM TO EXPRESS MY INTENT AS CLEARLY AS IT MIGHT HAVE, AND HAS APPARENTLY BEEN MISINTERPRETED IN MAKING THIS SETTLEMENT, ARRANGEMENTS WILL BE MADE TO HAVE AMENDMENT 1 TO B.A.I. ORDER 344 CLARIFIED BY REVISING IT IN SUCH A MANNER AS TO PRECLUDE ANY MISUNDERSTANDING IN THE FUTURE AS TO THE INTENT OF THE PROVISION OF SECTION 1 OF REGULATION 3, B.A.I. ORDER 344.

PROMPT ACTION TOWARD REVISION OF THE SETTLEMENT OF THIS CASE AND OTHER SIMILAR CASES IN WHICH SETTLEMENTS HAVE BEEN MADE ON THE SAME BASIS WILL BE GREATLY APPRECIATED.

A COPY OF THE PROPOSED REVISION OF THIS AMENDMENT IS BEING TRANSMITTED HEREWITH FOR YOUR OPINION.

PAYMENTS UNDER SECTION 6 OF THE ACT OF APRIL 7, 1934, 48 STAT. 528, ARE, BY THE TERMS OF THE STATUTE, TO BE MADE UNDER REGULATIONS PRESCRIBED BY THE SECRETARY OF AGRICULTURE AND UPON SUCH TERMS AS HE MAY PRESCRIBE. REGULATIONS ISSUED PURSUANT TO THE STATUTE HAVE THE FORCE AND EFFECT OF LAW. THEY MAY BE AMENDED FROM TIME TO TIME BUT SUCH AMENDMENTS MAY OPERATE PROSPECTIVELY ONLY. RIGHTS WHICH BECAME FIXED UNDER THE REGULATIONS CURRENT AT THE TIME THEY AROSE MAY NOT BE INCREASED OR DECREASED BY A SUBSEQUENT AMENDMENT TO SUCH STATUTORY REGULATIONS. THE AMENDMENT TO ORDER B.A.I. 344 PROPOSED BY YOU WOULD NOT, THEREFORE, CHANGE RIGHTS WHICH HAD BECOME VESTED UNDER THE PRIOR ORDERS AND AMENDMENTS THERETO. IT MAY BE STATED, ALSO, THAT WHILE THE PROPOSED AMENDMENT STATES THAT THE FEDERAL INDEMNITY SHALL BE PAID IRRESPECTIVE OF REGULATION 3 AND SECTION 7 OF REGULATION 6 OF B.A.I. 329, IT STILL RETAINS THE LIMITATION THAT THE OWNER SHALL NOT RECEIVE FROM ALL SOURCES AN AMOUNT EXCEEDING THAT WHICH WOULD HAVE BEEN RECEIVED PROVIDED THE CLAIM WAS COMPUTED IN ACCORDANCE WITH B.A.I. 329 OR ANY AMENDMENT THERETO. THE ELIMINATION OF REGULATION 3 OF B.A.I. 329 WOULD LEAVE NO BASIS FOR COMPUTATION UNDER THAT ORDER AND THE AMENDMENT, THEREFORE, WOULD NOT BE PRACTICABLE OF APPLICATION. IN THIS CONNECTION YOUR ATTENTION IS AGAIN INVITED TO THE FORM OF AMENDMENT SUGGESTED IN MY DECISION OF MARCH 18, 1935, TO YOU.

THE CLAIM OF NINA J. HAZELTON AS EXECUTRIX OF THE ESTATE OF DALLAS M. HAZELTON, WHICH WAS ADMINISTRATIVELY APPROVED FOR A TOTAL OF $374 WAS REDUCED IN THE SETTLEMENT OF SEPTEMBER 6, 1935, TO AN AGGREGATE OF $244, THE DIFFERENCE OF $130 BEING DISALLOWED AS THE PROPOSED PAYMENTS BY THE UNITED STATES ON SIX OF THE ANIMALS LISTED EXCEEDED PAYMENTS BY THE STATE TO THAT EXTENT. THE DISALLOWANCE OF THE CLAIM BEING IN ACCORDANCE WITH THE REGULATIONS IN FORCE AT THE TIME THE CLAIM AROSE, WHICH REGULATIONS SUSTAINED.