Matter of: Natalie A. Finholm File: B-258006 Date: June 5, 1995

Matter of: Natalie A. Finholm File: B-258006 Date: June 5, 1995

Delays occurred in settlement on new permanent residence and employee promptly requested extensions of Ms. Finholm's initial temporary quarters period. Ms. Finholm's Commanding Officer decided that circumstances that occurred during initial period of temporary quarters showed need for more time and granted extensions. Since the employee acted expeditiously to obtain permanent housing and the ensuing delays were beyond her control, we find that the agency had a reasonable basis to allow the additional time and that the granting of the extensions was a valid exercise of administrative discretion. See 41 C.F.R. Secs. 302-5.1 and 302-5.2(a)(2) (1994). Although the initial settlement date was scheduled to occur after completion of the initial period of temporary quarters, that is not, by itself, a reason to deny an otherwise compelling request for an extension. William M. Stoddard, B-248012, Aug. 25, 1992, distinguished.

DECISION

Ms. Natalie A. Finholm has appealed our Claims Group's Settlement Certificate Z-2869095, June 17, 1994, denying her claim for an additional 60 days of temporary quarters subsistence expenses. We reverse our Claims Group's action and allow her claim.

BACKGROUND

By orders dated May 14, 1993, the Department of the Navy transferred Ms. Natalie A. Finholm from Charleston, South Carolina, to Kings Bay, Georgia. She was authorized a 10-day house-hunting trip and 50 days of temporary quarters. Ms. Finholm began occupancy of temporary quarters on May 27, 1993.

Ms. Finholm signed a contract to purchase a new house on June 4, 1993. She states that construction was then complete and the house was ready for occupancy. The contract provided for a closing date on or before July 30, 1993. Ms. Finholm completed the loan application papers on June 7, 1993. The realtor informed her that she could expect to close before July 18. Delay in securing loan approval forced a later closing, however.

Ms. Finholm on June 24, requested a 30-day extension of her temporary quarters period. [1] On July 9, 1993, the Executive Officer, acting for the Commanding Officer, approved the extension, which ran from July 15 to August 13. On July 28, Ms. Finholm requested another 30-day extension that the Acting Commanding Officer approved on August 10, 1993, running from August 14 to September 13. Settlement finally occurred on September 23, 1993.

The Disbursing Officer denied Ms. Finholm's claim for subsistence expenses beyond the initial 50-day period allowed because the purchase contract had a possible settlement date after completion of the initial period. He based his action on his interpretation of our holding in William M. Stoddard, B-248012, August 25, 1992. In contrast, the Defense Finance and Accounting Service (DFAS) supports her claim based on the Commanding Officer's approvals and its own independent examination of the circumstances.

OPINION

The Federal Travel Regulation, at title 4 C.F.R. Sec. 302-5.2(a)(2) (1994), [2] in relevant part, provides:

"(2) Additional time in certain cases. Subsistence expenses as provided in paragraph (a)(1) of this section may be allowed for an additional period of time not to exceed 60 consecutive days provided the head of the agency, or his/her designee, determines that there are compelling reasons for the continued occupancy of temporary quarters. . . . The same considerations as expressed in Sec. 302-5.1 are applicable in allowing any part of the additional 60 days. . . . Extensions of the temporary quarters period may be authorized only in situations where there is a demonstrated need for additional time due to circumstances which have occurred during the initial 60-day period of occupancy and which are determined to be beyond the employee's control and acceptable to the agency. Examples of compelling reasons which could be considered as beyond the employee's control may include, but are not limited to, the following situations:

. . . . .

"(ii) New permanent residence cannot be occupied because of unanticipated problems (delays in settlement on new residence, short term delay in construction of a new residence, etc.)."

The record shows that the Commanding Officer of the receiving activity was the designated authorizing official who had the discretion to approve the extensions of temporary quarters under the criteria set forth in FTR Sec. 302-5.2(a)(2) and 2 JTR para. C13004. The Commanding Officer reviewed the extension requests and found that there were compelling reasons (principally delays in settlement caused by the mortgage company that occurred during the initial period of temporary quarters which were beyond Ms. Finholm's control) to grant Ms. Finholm's requests for extending her initial period of temporary quarters. We will not overturn such a command determination unless it is arbitrary, capricious, or contrary to law. Mark A. Wohlander, B-238300, Oct. 4, 1990, and decisions cited therein.

In disallowing payment for the additional periods, the disbursing officer relied on our decision in William M. Stoddard, supra. There, in denying his request for an extension, the agency noted that Mr. Stoddard had spent 2 months at his new duty station before his period of temporary quarters started without apparently making much effort to find permanent quarters. Moreover, when he did locate a permanent residence, he applied for a type of loan that he knew usually takes several weeks longer to complete. Finally, he did not apply for the extension until after completion of his initial period of temporary quarters. In the agency's view, the proper time to seek an extension is during, not after, the period of temporary quarters has expired. We upheld the agency's denial of additional time as a proper exercise of its discretion to limit the period of temporary quarters. Therefore, Stoddard is distinguishable on its facts.

Even though in Stoddard we noted that the initial settlement date was scheduled after the end of the initial temporary quarters period, it was not our intention to suggest that the mere fact that the settlement date is scheduled beyond the initial period of temporary quarters is, by itself, a reason for denying an otherwise compelling request for an extension. Rather, our decision in Stoddard stands for the rule that an agency has broad discretion to extend or limit the total period of temporary quarters occupancy and that each request for an extension should be granted or denied depending upon the particular circumstances of the case.

This view is consistent with the text of the FTR, quoted above, which specifically provides that examples of compelling reasons to justify extensions may include situations where the new permanent residence cannot be occupied because of unanticipated circumstances beyond the control of the member that arise during the initial period. 41 C.F.R. Sec. 302- 5.2(a)(2) (1994). Thus, even where settlement is originally scheduled after the initial period expires, if settlement delays arise during the initial period of temporary quarters that are beyond the employee's control, the agency head or his designee may find that such delays constitute compelling reasons for additional time and may decide that the initial temporary quarters period will be extended.

In Ms. Finholm's case, the record demonstrates that the employee acted expeditiously to obtain permanent housing and, when delays occurred that were beyond her control, promptly requested additional time in temporary quarters. Under these circumstances, we find that the agency had a reasonable basis to exercise its discretion to grant the two extensions. Accordingly, the Claims Group's denial is reversed and Ms. Finholm's claim for the extended periods of temporary quarters is allowed.

1. The record at various points shows several different ending dates for the initial temporary quarters period, ranging from July 14 to July 27. It was eventually determined to be July 14, 1993.

2. See JTR, Vol. 2, para. C13004.