B-10081, MAY 18, 1940, 19 COMP. GEN. 940

B-10081, MAY 18, 1940, 19 COMP. GEN. 940

COMPENSATION AND CLASSIFICATION CHANGES - REORGANIZATION ACT PROHIBITION THE PROHIBITORY COMPENSATION AND CLASSIFICATION CHANGE PROVISIONS OF SECTION 10 (B) OF THE REORGANIZATION ACT OF 1939, 53 STAT. 1563, DO NOT APPLY TO AN APPOINTMENT BY THE PRESIDENT, WITH THE CONSENT OF THE SENATE, OF A PERSON THERETOFORE EMPLOYED AT A LOWER SALARY RATE.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF AGRICULTURE, MAY 18, 1940:

I HAVE YOUR LETTER OF MAY 3, 1940, AS FOLLOWS:

THE PRESIDENT ISSUED A COMMISSION TO MR. CARL R. ARNOLD ON MARCH 26, 1940, APPOINTING HIM TO THE OFFICE OF PRODUCTION CREDIT COMMISSIONER IN THE FARM CREDIT ADMINISTRATION, MR. ARNOLD'S NOMINATION HAVING BEEN CONFIRMED BY THE SENATE ON MARCH 20, 1940. THE ACT OF CONGRESS APPROVED JUNE 16, 1933 (48 STAT. 273), PROVIDES THAT A PERSON FILLING THE OFFICE OF PRODUCTION CREDIT COMMISSIONER SHALL RECEIVE AN ANNUAL SALARY OF $10,000.

UNDER THE PROVISIONS OF SECTION 101 (A) OF REORGANIZATION PLAN NO. I, SUBMITTED IN ACCORDANCE WITH THE REORGANIZATION ACT OF 1939, APPROVED APRIL 3, 1939 (53 STAT. 563), THE FARM CREDIT ADMINISTRATION, ITS FUNCTIONS AND ACTIVITIES, PERSONNEL, RECORDS, AND PROPERTY, WERE TRANSFERRED TO THE DEPARTMENT OF AGRICULTURE, EFFECTIVE ON JULY 1, 1939. ON JUNE 30, 1939, MR. ARNOLD WAS FILLING THE POSITION OF DEPUTY PRODUCTION CREDIT COMMISSIONER (EXPERT) AT AN ANNUAL SALARY OF $9,500, AND CONTINUED IN THAT POSITION TO AND INCLUDING MARCH 25, 1940,WHEN HIS SERVICES WERE TERMINATED IN ORDER THAT HE COULD ENTER ON DUTY ON MARCH 26 UNDER HIS PRESIDENTIAL APPOINTMENT AS PRODUCTION CREDIT COMMISSIONER.

THE REORGANIZATION ACT OF 1939 PROVIDES THAT ANY TRANSFER OF PERSONNEL UNDER THAT TITLE SHALL BE WITHOUT CHANGE IN CLASSIFICATION OR COMPENSATION, EXCEPT THAT SAID REQUIREMENT SHALL NOT OPERATE AFTER THE END OF THE FISCAL YEAR DURING WHICH THE TRANSFER IS MADE TO PREVENT THE ADJUSTMENT OF CLASSIFICATION OR COMPENSATION TO CONFORM TO THE DUTIES TO WHICH SUCH TRANSFERRED PERSONNEL MAY BE ASSIGNED (SECTION 10 (B) (, AND THAT ALL LAWS RELATING TO ANY AGENCY OR FUNCTION TRANSFERRED TO, OR CONSOLIDATED WITH, ANY OTHER AGENCY OR FUNCTION UNDER THE PROVISIONS OF THAT TITLE SHALL, INSOFAR AS SUCH LAWS ARE NOT INAPPLICABLE, REMAIN IN FULL FORCE AND EFFECT (SECTION 8 (C) ).

DECISION OF AUGUST 22, 1939 (19 COMP. GEN. 237), DISCUSSED SECTIONS 10 (B) AND 8 (C), AND STATED THAT THE VARIOUS PAY STATUTES APPLICABLE TO COMMISSIONED OFFICERS OF THE PUBLIC HEALTH SERVICE, AND THE ADMINISTRATIVE REGULATIONS ISSUED PURSUANT THERETO WHICH HAVE THE FORCE AND EFFECT OF LAW PRESCRIBE A SCHEDULE OF RATES OF PAY AND ALLOWANCES FOR THE COMMISSIONED PERSONNEL OF THE PUBLIC HEALTH SERVICE BASED ON RANK, LENGTH OF SERVICE, ETC., AND, UNDER THE PROVISIONS OF SECTION 8 (C) OF THE REORGANIZATION ACT, SUCH STATUTES AND REGULATIONS CONTINUE TO OPERATE WITH RESPECT TO SAID COMMISSIONED PERSONNEL AFFECTED BY THE REORGANIZATION ACT AND REORGANIZATION PLANS THEREUNDER. THE DECISION HELD THAT SECTION 10 (B) PERMITTED THE PROMOTION IN GRADE OF COMMISSIONED OFFICERS IN THE REGULAR CORPS WHOSE PROMOTIONS AND RANK ARE DUE DURING THE FISCAL YEAR 1940, AND THAT SUCH OFFICERS MAY RECEIVE THE PAY AND ALLOWANCES OF THE HIGHER GRADE.

IT IS BELIEVED THAT THE FOREGOING PRINCIPLE IS APPLICABLE TO THE QUESTION OF THE RATE OF COMPENSATION PAYABLE TO MR. ARNOLD AS PRODUCTION CREDIT COMMISSIONER DURING THE REMAINDER OF THE PRESENT FISCAL YEAR, BECAUSE THE SALARY OF THE LATTER POSITION IS FIXED BY STATUTE, AND HE WAS APPOINTED THERETO BY THE PRESIDENT AFTER SENATE CONFIRMATION, WHEREAS APPOINTMENT TO THE POSITION OF DEPUTY PRODUCTION CREDIT COMMISSIONER WAS WITHIN THE AUTHORITY OF THE GOVERNOR OF THE FARM CREDIT ADMINISTRATION PRIOR TO JULY 1, 1939, AFTER WHICH DATE THE AUTHORITY BECAME VESTED IN THE SECRETARY OF AGRICULTURE.

YOUR ADVANCE DECISION IN THIS MATTER WILL BE APPRECIATED IN ORDER THAT PAYMENTS OF COMPENSATION TO MR. ARNOLD MAY BE MADE AT THE PROPER RATE.

AN EXAMINATION OF THE REORGANIZATION ACT, AS WELL AS ITS LEGISLATIVE HISTORY, DISCLOSES NO INTENTION OF THE CONGRESS THAT THE PROVISIONS OF SECTION 10 (B) OF THE ACT, 53 STAT. 563, WERE IN ANY WISE TO APPLY TO CASES OF APPOINTMENTS REQUIRED BY STATUTE TO BE MADE BY THE PRESIDENT "BY AND WITH THE ADVICE AND CONSENT OF THE SENATE.' ON THE CONTRARY, THE INHIBITIONS PRESCRIBED BY SECTION 10 (B) OF THE CITED ACT APPEAR TO BE DIRECTED TO THE HEADS OF SUCH AGENCIES AS MIGHT BE AFFECTED BY "ANY TRANSFER OF PERSONNEL" UNDER TITLE I OF THE ACT--- A MATTER IN NOWISE RELATED TO APPOINTMENTS WHICH, BY STATUTE, ARE REQUIRED TO BE MADE BY THE PRESIDENT AND CONFIRMED BY THE SENATE AND WHERE THE SALARY RATE OF THE POSITION FILLED BY SUCH EXECUTIVE APPOINTMENT IS FIXED BY STATUTE.

ACCORDINGLY, THE PRESIDENT HAVING, ON MARCH 26, 1940, ISSUED A COMMISSION TO MR. ARNOLD, WHOSE NOMINATION WAS CONFIRMED BY THE SENATE ON MARCH 20, 1940, AND MR. ARNOLD HAVING ENTERED UPON DUTY ON MARCH 26 UNDER HIS PRESIDENTIAL APPOINTMENT AS PRODUCTION CREDIT COMMISSIONER FOR WHICH POSITION THE STATUTE FIXES A SALARY OF $10,000 PER ANNUM, YOU ARE ADVISED THAT SECTION 10 (B) OF THE REORGANIZATION ACT CONSTITUTES NO BAR TO THE PAYMENT OF MR. ARNOLD'S COMPENSATION AT THE STATUTORY RATE FROM AND INCLUDING MARCH 26, 1940.