B-155796, FEB. 17, 1965, 44 COMP. GEN. 491

B-155796, FEB. 17, 1965, 44 COMP. GEN. 491

LEASE-PURCHASE PROGRAM - RENT - APPROPRIATION PROHIBITION THE FACT THAT THE LIMITATION IN THE INDEPENDENT OFFICES APPROPRIATION ACT, 1965, ON THE USE OF THE FUNDS MADE AVAILABLE FOR PAYMENT OF RENTAL UNDER LEASE AGREEMENTS ACCOMMODATING FEDERAL AGENCIES IN BUILDINGS COSTING THE LESSOR IN EXCESS OF $200,000 TO CONSTRUCT, APPEARS UNDER THE HEADING "GENERAL SERVICES ADMINISTRATION," THE AGENCY PRIMARILY CONCERNED WITH REAL PROPERTY ACQUISITION AND MANAGEMENT, DOES NOT PRECLUDE THE APPLICATION OF THE RESTRICTION TO THE FEDERAL AVIATION AGENCY, THE LANGUAGE OF THE LIMITATION PRESCRIBING THAT IT SHALL APPLY TO "ANY APPROPRIATION CONTAINED IN THIS ACT," AND THE LEGISLATIVE HISTORY INDICATING CONCERN WITH THE COSTLINESS OF THE LEASE CONSTRUCTION METHOD AND NOT THE AGENCY INVOLVED, AND ABSENT CONGRESSIONAL APPROVAL OF A LEASE- PURCHASE AGREEMENT COSTING IN EXCESS OF THE LIMITATION, THE RESTRICTION APPLIES EVEN IF LESS THAN $200,000 OF THE FUNDS APPROPRIATED UNDER THE INDEPENDENT OFFICES APPROPRIATIONS ACT ARE USED AND THE BALANCE OF THE CONSTRUCTION COST OF THE BUILDING IS PAID FROM APPROPRIATIONS NOT SUBJECT TO THE LIMITATION.

TO THE ADMINISTRATOR, FEDERAL AVIATION AGENCY, FEBRUARY 17, 1965:

THIS IS IN REPLY TO THE LETTER DATED DECEMBER 15, 1964, WHEREIN YOUR OFFICE SUBMITTED FOR OUR DECISION TWO QUESTIONS CONCERNING THE APPLICATION OF THE BELOW-QUOTED PROVISION OF THE INDEPENDENT OFFICES APPROPRIATION ACT, 1965, PUBLIC LAW 88-507, 78 STAT. 640, 655.

NO PART OF ANY APPROPRIATION CONTAINED IN THIS ACT SHALL BE USED FOR THE PAYMENT OF RENTAL ON LEASE AGREEMENTS FOR THE ACCOMMODATION OF FEDERAL AGENCIES IN BUILDINGS AND IMPROVEMENTS WHICH ARE TO BE ERECTED BY THE LESSOR FOR SUCH AGENCIES AT AN ESTIMATED COST OF CONSTRUCTION IN EXCESS OF $200,000 OR FOR THE PAYMENT OF THE SALARY OF ANY PERSON WHO EXECUTES SUCH A LEASE AGREEMENT: PROVIDED, THAT THE FOREGOING PROVISO SHALL NOT BE APPLICABLE TO PROJECTS FOR WHICH A PROSPECTUS FOR THE LEASE CONSTRUCTION OF SPACE HAS BEEN SUBMITTED TO AND APPROVED BY THE APPROPRIATE COMMITTEES OF THE CONGRESS IN THE SAME MANNER AS FOR PUBLIC BUILDINGS CONSTRUCTION PROJECTS PURSUANT TO THE PUBLIC BUILDINGS ACT OF 1959.

THE FIRST QUESTION WAS WHETHER THE PROVISION, A LIMITATION ON THE USE OF APPROPRIATED FUNDS, IS APPLICABLE TO THE APPROPRIATIONS OF THE FEDERAL AVIATION AGENCY, WHICH ARE CONTAINED IN THE INDEPENDENT OFFICES APPROPRIATION ACT, 1965.

THE PROVISION IS ONE OF SEVERAL "GENERAL PROVISIONS" UNDER THE APPROPRIATION HEADING "GENERAL SERVICES ADMINISTRATION.' BEING APPLICABLE TO "ANY APPROPRIATION CONTAINED IN THIS ACT," AFFIRMATIVE ANSWER TO THE QUERY APPEARS TO BE REQUIRED. HOWEVER, THE APPLICATION OF THE PROVISION TO FEDERAL AVIATION AGENCY APPROPRIATIONS IS QUESTIONED IN VIEW OF THE LEGISLATIVE BACKGROUND OF THE LIMITATIONS AND THE PURPORTED ANOMALOUS SITUATIONS THAT WOULD ARISE.

IT IS STATED, INTER ALIA, THAT THE HISTORY OF THE LIMITATION SHOWS IT WAS DIRECTED AT THE LEASE-CONSTRUCTION ACTIVITIES OF THE GENERAL SERVICES ADMINISTRATION, PARTICULARLY THE ACQUISITION OF OFFICE SPACE WITHIN THE DISTRICT OF COLUMBIA, AND THAT AN AFFIRMATIVE INDICATION THAT THE CONGRESS INTENDED ITS APPLICATION TO OTHER AGENCIES, SUCH AS THE FEDERAL AVIATION AGENCY, IS NOT DISCLOSED.

THE FUNCTION OF ACQUIRING SPACE IN BUILDINGS BY LEASE FOR THE HOUSING OF GOVERNMENT AGENCIES IS GENERALLY VESTED IN THE ADMINISTRATOR OF GENERAL SERVICES. REORGANIZATION PLAN NO. 18 OF 1950, 64 STAT. 1270. EXCEPTION PERMITTING THE FEDERAL AVIATION AGENCY TO ACQUIRE ITS OWN SPACE EXISTS IN THE SITUATION WHERE THE "ADMINISTRATOR OF GENERAL SERVICES DETERMINES, PURSUANT TO SECTION 1 (D) OF REORGANIZATION PLAN NUMBERED 18, 1950, THAT THE SPACE TO BE ACQUIRED IS TO BE UTILIZED FOR THE SPECIAL PURPOSES OF THE FEDERAL AVIATION AGENCY AND IS NOT GENERALLY SUITABLE FOR THE USE OF OTHER AGENCIES.' 49 U.S.C. 1344 (C) (2). IT IS THE APPLICATION OF THE LIMITATION TO APPROPRIATIONS OF THE FEDERAL AVIATION AGENCY AVAILABLE FOR THE ACQUISITION OF "SPECIAL PURPOSE" SPACE THAT IS HERE INVOLVED. SEE EXHIBIT 1, APPENDIX C TO GSA REG. 2-1-101.04, DESIGNATING BUILDING SPACE AT AIRPORTS AS "SPECIAL PURPOSE" SPACE FOR FAA.

THE LIMITATION PROVISION ORIGINATED WITH THE INDEPENDENT OFFICES APPROPRIATION ACT, 1963, PUBLIC LAW 87-741, 76 STAT. 716, 728. IT WAS PLACED IN THE BILL WHICH SUBSEQUENTLY BECAME THAT ACT BY THE HOUSE COMMITTEE ON APPROPRIATIONS. H.R. 12711, 87TH CONGRESS, 2D SESSION, JULY 27, 1962. THE PROVISION WAS ADOPTED BY THE HOUSE OF REPRESENTATIVES BUT DELETED BY THE SENATE. THE COMMITTEE OF CONFERENCE RECOMMENDED RESTORATION---

AMENDMENT NO. 97: RESTORES HOUSE LANGUAGE RELATING TO LEASE CONSTRUCTION AGREEMENTS. THE CONFEREES ARE AGREED ON THE MERIT OF THE AMENDMENT AND RECOMMENDED THAT THE LEGISLATIVE COMMITTEES GIVE LEASE CONSTRUCTION FURTHER STUDY. H.REPT.NO. 2376, 87TH CONG. 2D SESS. 19.

EACH INDEPENDENT OFFICES APPROPRIATION ACT SINCE THE FISCAL YEAR 1963 HAS CONTAINED THE PROVISION.

THAT THE LIMITATION AROSE IN CONNECTION WITH A GENERAL SERVICES ADMINISTRATION PROGRAM, THE AGENCY PRIMARILY CONCERNED WITH REAL PROPERTY ACQUISITION AND MANAGEMENT, AFFORDS LITTLE BASIS FOR IGNORING THE VERY TERMS OF THE PROVISION MAKING IT APPLICABLE "TO ANY APPROPRIATION CONTAINED IN THIS ACT.' IN EXPLAINING THE LIMITATION THE HOUSE COMMITTEE ON APPROPRIATIONS STATED:

THE GENERAL SERVICES ADMINISTRATION WANTS TO BUILD SEVERAL NEW BUILDINGS IN THE DISTRICT OF COLUMBIA UNDER A LEASE CONSTRUCTION PROGRAM TO PROVIDE 1 MILLION SQUARE FEET OF ADDITIONAL SPACE. THE ENTIRE SPACE IN EACH BUILDING IS TO BE RENTED BY THE GOVERNMENT. WITH THIS PROCEDURE THE COMMITTEE DISAGREES SINCE THEY ARE COMPLETELY FINANCED NEW BUILDINGS UNDER LEASE CONSTRUCTION CONTRACTS. THE COMMITTEE BELIEVES THAT THE GOVERNMENT SHOULD OWN THE BUILDINGS INSTEAD OF GIVING SOMEBODY A TEN TO FIFTEEN YEAR PAYOUT.

THE CONCERN OF THE COMMITTEE IS THAT LEASE CONSTRUCTION IS CLEARLY THE MOST EXPENSIVE METHOD OF PROVIDING GOVERNMENT SPACE. UNDER THIS METHOD THE GOVERNMENT PAYS RENT AT $4 TO $4.25 PER SQUARE FOOT PER YEAR AND NEVER OBTAINS TITLE TO THE PROPERTY. A LIMITATION ON USE OF FUNDS FOR LEASE CONSTRUCTION PROJECTS COSTING OVER $200,000 HAS THEREFORE BEEN INCLUDED IN THE BILL, BUT IT PROVIDES THAT PROJECTS MAY PROCEED AFTER OBTAINING LEGISLATIVE APPROVAL IN ADVANCE OF A COMMITMENT IN THE SAME MANNER AS FOR PUBLIC BUILDING CONSTRUCTION PROJECTS FINANCED BY DIRECT APPROPRIATIONS PURSUANT TO THE PUBLIC BUILDINGS ACT OF 1959. H.REPT.NO. 2050, 87TH CONG., 2D SESS. 13.

THE EXPRESSED CONCERN OF THE COMMITTEE WAS WITH THE METHOD OF PROVIDING GOVERNMENT SPACE AND NOT THE AGENCY INVOLVED, THE COSTLINESS OF THE LEASE- CONSTRUCTION METHOD. THE COMMITTEE'S CONCERN NEED NOT AND APPARENTLY DID NOT STOP WITH THE GENERAL SERVICES ADMINISTRATION, ALTHOUGH IT MAY HAVE BEEN ASSUMED THAT ONLY THAT AGENCY SHOULD BE INVOLVED IN A LEASE- CONSTRUCTION PROJECT COSTING IN EXCESS OF $200,000. NOR, WITH REFERENCE TO THE CONCERN OF THE COMMITTEE, DOES THERE APPEAR TO BE A BASIS FOR DISTINGUISHING "GENERAL PURPOSE" FROM "SPECIAL PURPOSE" LEASE-CONSTRUCTION AGREEMENTS. WE ARE OF THE OPINION THAT NEITHER THE LEGISLATIVE HISTORY NOR THE PURPOSE OF THE PROVISION AFFORDS A BASIS FOR EXCLUDING A FEDERAL AVIATION AGENCY LEASE AGREEMENT INVOLVING THE CONSTRUCTION OF A BUILDING COSTING IN EXCESS OF $200,000 FROM THE PURVIEW OF THE LIMITATION. FURTHERMORE, THE FACT THAT THE PROVISION FOLLOWS THE APPROPRIATIONS OF THE GENERAL SERVICES ADMINISTRATION APPEARS OF LITTLE SIGNIFICANCE AS THE APPLICATION OF THIS LIMITATION TO AGENCIES OTHER THAN THE GENERAL SERVICES ADMINISTRATION IS NOT UNIQUE AMONG THE PROVISIONS UNDER THE HEADING "GENERAL SERVICES ADMINISTRATION.'

THE ARGUMENT IS ADVANCED THAT THE APPLICATION OF THE LIMITATION TO THE FEDERAL AVIATION AGENCY WOULD LEAD TO SOME ANOMALOUS SITUATIONS. PARTICULARLY WHERE A SINGLE LEASE-CONSTRUCTION BUILDING IS TO BE OCCUPIED BY THE FEDERAL AVIATION AGENCY JOINTLY WITH ANOTHER FEDERAL AGENCY, SUCH AS THE WEATHER BUREAU, WHICH ALSO HAS THE AUTHORITY TO LEASE "SPECIAL PURPOSE" SPACE BUT WHOSE APPROPRIATIONS, NOT CONTAINED IN THE INDEPENDENT OFFICES APPROPRIATION ACT, ARE NOT SUBJECT TO THE LIMITATION.

THE ANOMALOUS SITUATIONS AIRSE BY VIRTUE OF CONGRESSIONAL APPLICATION OF THE LIMITATION ONLY TO APPROPRIATIONS CONTAINED IN THE INDEPENDENT OFFICES APPROPRIATION ACT. THE ARGUMENT IS THAT SINCE THE LIMITATION WAS NOT MADE APPLICABLE TO ALL AGENCIES OF THE GOVERNMENT, OR ALL EXECUTIVE AGENCIES OF THE GOVERNMENT, AND ADMINISTRATIVE DIFFICULTIES MAY BE ENCOUNTERED IN SEEKING CONGRESSIONAL APPROVAL FOR A JOINT-AGENCY LEASE-CONSTRUCTION PROJECT, THE PROVISION MUST HAVE BEEN INTENDED TO HAVE NARROWER SCOPE THAN ITS TERMS CLEARLY PROVIDE. WE SEE LITTLE MERIT IN THIS CONTENTION CONSIDERING THE EXPRESSED CONGRESSIONAL CONCERN WITH THE USE OF THE LEASE- CONSTRUCTION PROCEDURE IN THE ACQUISITION OF SPACE FOR FEDERAL ACTIVITIES. MOREOVER WE DO FIND, TAKING THE VARIOUS MATTERS PRESENTED IN CONCERT, THAT A CASE HAS BEEN MADE FOR INTERPRETING THE LIMITATION PROVISION AS NOT APPLYING TO FEDERAL AVIATION AGENCY APPROPRIATIONS. SUCH AN INTERPRETATION WOULD BE AN UNWARRANTED GLOSS UPON THE PROVISION. THE FACT OF INVOLVEMENT OF OTHER AGENCIES BESIDE THE GENERAL SERVICES ADMINISTRATION, WHICH MAY NOT HAVE BEEN ANTICIPATED, IS NO JUSTIFICATION FOR IGNORING THE CLEAR AND SPECIFIC CONGRESSIONAL LANGUAGE THAT THE LIMITATION SHALL APPLY TO "ANY APPROPRIATION CONTAINED IN THIS ACT," PARTICULARLY WHEN TO DO SO WOULD NOT BE IN CONSONANCE WITH THE LEGISLATIVE OBJECTIVE SOUGHT TO BE ACHIEVED. ACCORDINGLY, THE FIRST QUESTION IS ANSWERED IN THE AFFIRMATIVE.

THE SECOND QUESTION, PREDICATED UPON AN AFFIRMATIVE ANSWER TO THE FIRST QUESTION, WAS WHETHER THE LIMITATION IS APPLICABLE TO A LEASE CONSTRUCTION CONTRACT INVOLVING AN ESTIMATED COST OF CONSTRUCTION OF LESS THAN $200,000 FROM FUNDS APPROPRIATED UNDER THE INDEPENDENT OFFICES APPROPRIATION ACT, BUT MORE THAN $200,000 IF AGGREGATED WITH COSTS TO BE PAID FROM OTHER APPROPRIATION ACTS NOT SUBJECT TO THE LIMITATION.

IF THE ESTIMATED COST OF THE CONSTRUCTION OF A BUILDING TO BE ERECTED FOR THE ACCOMMODATION OF FEDERAL AGENCIES IS IN EXCESS OF $200,000, THE LIMITATION WOULD APPLY TO PRECLUDE THE USE OF ANY APPROPRIATION CONTAINED IN THE INDEPENDENT OFFICES APPROPRIATION ACT FOR THE PAYMENT OF RENTAL IN THE ABSENCE OF APPROVAL OF THE PROJECT BY THE APPROPRIATE COMMITTEES OF THE CONGRESS. THE SECOND QUESTION IS ALSO ANSWERED IN THE AFFIRMATIVE.