B-176632, OCT 12, 1972

B-176632, OCT 12, 1972

CIVILIAN PERSONNEL - DUAL POSITIONS - OVERPAYMENT - WAIVER DECISION ALLOWING WAIVER IN PART OF CERTAIN PAYMENTS TO HARALD B. MALMGREN, THE DEPUTY SPECIAL REPRESENTATIVE FOR TRADE NEGOTIATIONS. SECTION 5533(C)(1) OF TITLE 5, U. S. CODE, PROVIDES THAT WHERE AN INDIVIDUAL HOLDS TWO GOVERNMENT POSITIONS, ONE OF WHICH IS PAID BY THE SECRETARY OF THE SENATE, HE IS ENTITLED TO RETAIN THE COMPENSATION FOR ONLY ONE OF THE POSITIONS IF THE COMBINED PAY RATE EXCEEDS $8,637 A YEAR. HOWEVER, 5 U.S.C. 5584 ALLOWS WAIVER OF CERTAIN ERRONEOUS PAYMENTS BY AN EXECUTIVE AGENCY WHERE THERE IS NO INDICATION OF FRAUD, MISREPRESENTATION OR LACK OF GOOD FAITH ON THE PART OF THE EMPLOYEE. THIS PROVISION MAY NOT BE APPLIED TO PAYMENTS MADE BY THE SECRETARY OF THE SENATE. THEREFORE, WHERE AN EMPLOYEE HAS KNOWLEDGE THAT HE CANNOT RECEIVE MORE THAN $8,637 FROM BOTH POSITIONS, ONLY THAT PORTION OF THE PAY RECEIVED FROM THE EXECUTIVE AGENCY WHICH, WHEN ADDED TO THE AMOUNT RECEIVED FROM THE SECRETARY OF THE SENATE, TOTALS $8,637 MAY BE WAIVED.

TO MR. W. D. EBERLE:

WE REFER FURTHER TO YOUR LETTER OF JULY 20, 1972, WHEREIN YOU REQUEST WAIVER ACTION UNDER THE PROVISIONS OF 5 U.S.C. 5584 IN RESPECT TO CERTAIN PAYMENTS OF PAY TO AMBASSADOR HARALD B. MALMGREN, THE DEPUTY SPECIAL REPRESENTATIVE FOR TRADE NEGOTIATIONS UNDER THE CIRCUMSTANCES HEREAFTER SET FORTH.

YOU EXPLAIN THAT IN JANUARY 1972 YOU RECOMMENDED TO THE PRESIDENT THE APPOINTMENT OF MR. MALMGREN TO THE POSITION OF DEPUTY SPECIAL REPRESENTATIVE FOR TRADE NEGOTIATIONS WHICH REQUIRES THE ADVICE AND CONSENT OF THE SENATE. AT THAT TIME YOU WERE AWARE THAT HE WAS PERFORMING CERTAIN PART-TIME CONSULTING SERVICES FOR A UNITED STATES SENATOR FOR WHICH HE RECEIVED PAYMENT FROM THE SECRETARY OF THE SENATE AT AN ANNUAL RATE OF $8,288. SINCE YOU ANTICIPATED HIS EARLY APPOINTMENT AS A DEPUTY SPECIAL REPRESENTATIVE IT WAS ARRANGED THAT MR. MALMGREN WOULD SERVE AS AN EXPERT AND PART-TIME CONSULTANT TO YOUR OFFICE ON A PER DIEM BASIS BEGINNING JANUARY 24, 1972. IT INFORMALLY HAS BEEN ASCERTAINED THAT HIS APPOINTMENT WAS MADE AT THE RATE OF $120 PER DAY OR $31,200 PER ANNUM ($120 X 260 DAYS).

IN VIEW OF THE FACT THAT MR. MALMGREN WAS OCCUPYING TWO POSITIONS THE FOLLOWING PROVISIONS OF 5 U.S.C. 5533 WOULD BE APPLICABLE:

"(C)(1) UNLESS OTHERWISE AUTHORIZED BY LAW AND EXCEPT AS OTHERWISE PROVIDED BY PARAGRAPH (2) OF THIS SUBSECTION, APPROPRIATED FUNDS ARE NOT AVAILABLE FOR PAYMENT TO AN INDIVIDUAL OF PAY FROM MORE THAN ONE POSITION IF THE PAY OF ONE OF THE POSITIONS IS PAID BY THE SECRETARY OF THE SENATE OR THE CLERK OF THE HOUSE OF REPRESENTATIVES, OR ONE OF THE POSITIONS IS UNDER THE OFFICE OF THE ARCHITECT OF THE CAPITOL, AND IF THE AGGREGATE GROSS PAY FROM THE POSITIONS EXCEEDS $7,724 A YEAR.

"(3) FOR THE PURPOSES OF THIS SUBSECTION, 'GROSS PAY' MEANS THE ANNUAL RATE OF PAY (OR EQUIVALENT THEREOF IN THE CASE OF AN INDIVIDUAL PAID ON OTHER THAN AN ANNUAL BASIS) RECEIVED BY AN INDIVIDUAL."

WE UNDERSTAND THE RATE OF $7,724 WAS INCREASED TO $8,187 EFFECTIVE FEBRUARY 1, 1971, AND TO $8,637 A YEAR EFFECTIVE JANUARY 1, 1972.

IT APPEARS THAT MR. MALMGREN HAD BEEN ADVISED BY PRIVATE COUNSEL THAT THE ABOVE PROVISIONS OF LAW WERE APPLICABLE ONLY TO THE EXTENT THE ACTUAL PAY RECEIVED FROM THE TWO POSITIONS EXCEEDED $8,637. IT WAS ANTICIPATED THAT MR. MALMGREN WOULD RESIGN FROM THE SENATE POSITION BUT THIS DID NOT OCCUR UNTIL MAY 11, 1972, WHEN HIS APPOINTMENT AS DEPUTY SPECIAL REPRESENTATIVE FINALLY WAS CONSUMMATED. AS A RESULT THEREOF HE RECEIVED PAYMENTS FROM YOUR OFFICE UNDER THE PART-TIME CONSULTANT POSITION TOTALING $7,732.32 AND IN ADDITION RECEIVED APPROXIMATELY $2,500 IN PAYMENTS FROM THE SECRETARY OF THE SENATE.

UNDER 5 U.S.C. 5533(C)(1) IT IS THE RATE OF COMPENSATION WHICH DETERMINES WHETHER THE STATUTE IS BEING VIOLATED RATHER THAN THE AMOUNT RECEIVED. WHEN MR. MALMGREN WAS APPOINTED AS A CONSULTANT IN YOUR OFFICE ON JANUARY 24, 1972, THE RATE FOR THAT POSITION AND THE ONE IN THE SENATE EXCEEDED THE SPECIFIED MAXIMUM RATE OF $8,637 WHICH HE COULD RECEIVE FROM BOTH POSITIONS. AS A CONSEQUENCE HE WAS ENTITLED TO RETAIN THE COMPENSATION OF ONLY ONE OF THE POSITIONS, AND SINCE HE RECEIVED COMPENSATION FROM BOTH HE IS TO BE REGARDED AS HAVING RECEIVED AN ERRONEOUS PAYMENT OF PAY FROM ONE OF THE TWO POSITIONS.

CERTAIN ERRONEOUS PAYMENTS OF PAY OCCURRING IN AN EXECUTIVE AGENCY ARE SUBJECT TO WAIVER UNDER THE PROVISIONS OF 5 U.S.C. 5584, PROVIDED THERE IS NO INDICATION OF FRAUD, MISREPRESENTATION OR LACK OF GOOD FAITH ON THE PART OF THE EMPLOYEE OR ANY OTHER PERSON HAVING AN INTEREST IN OBTAINING A WAIVER OF THE ERRONEOUS PAYMENT. HOWEVER, SUCH PROVISIONS ARE NOT APPLICABLE TO PAYMENTS MADE BY THE SECRETARY OF THE SENATE. IN VIEW THEREOF, MR. MALMGREN HAS APPARENTLY ELECTED TO RETAIN THE COMPENSATION RECEIVED FROM THE SECRETARY OF THE SENATE AND SEEK WAIVER OF THE AMOUNT RECEIVED FROM YOUR OFFICE WHICH QUALIFIES AS AN "EXECUTIVE AGENCY."

YOU STATE THAT YOU HAVE CONDUCTED AN INVESTIGATION AND FOUND THAT THERE IS NO INDICATION OF FRAUD, MISREPRESENTATION, FAULT, OR LACK OF GOOD FAITH ON THE PART OF MR. MALMGREN OR ANY OTHER INDIVIDUAL AND ASSERT HE WOULD HAVE RESIGNED HIS POSITION WITH THE SENATE IN JANUARY BEFORE ACCEPTING THE CONSULTING APPOINTMENT WITH YOUR OFFICE HAD HE BEEN AWARE OF THE INCONSISTENCY WITH THE PROVISIONS OF THE DUAL COMPENSATION ACT. IN THAT CONNECTION WE NOTE THAT WHILE MR. MALMGREN WAS NOT AWARE THAT HE WAS IN VIOLATION OF 5 U.S.C. 5533(C)(1) WHEN HE ACCEPTED THE APPOINTMENT IN YOUR OFFICE, NEVERTHELESS HE AT LEAST HAD KNOWLEDGE THAT HE COULD NOT RECEIVE MORE THAN $8,637 IN ONE YEAR FROM THE TWO POSITIONS. UNDER SUCH CIRCUMSTANCES WE CAN ONLY WAIVE, AND HEREBY DO WAIVE, THAT PORTION OF THE COMPENSATION RECEIVED FROM YOUR OFFICE WHICH WHEN ADDED TO THE AMOUNT RECEIVED FROM THE SENATE (STATED TO BE APPROXIMATELY $2,500) TOTALS $8,637. THE DIFFERENCE WOULD BE FOR COLLECTION.