Washington, DC
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Department of the Army
Sembach, Germany
Damon B. Ford
Compensation and Leave Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance
04/08/2020
Date
The claimant is a Federal civilian employee of the U.S. Army Installation Management Command, Department of the Army (DA), in Sembach, Germany. He requests the U.S. Office of Personnel Management (OPM) reconsider the agency’s denial of his request concerning furniture rental as an allowable cost associated with his approved living quarters allowance (LQA). He seeks a total of $3,448.76, which he estimates as the outstanding payment for the remaining seven months on his existing furniture rental contract. We received the request from the claimant on September 7, 2018, and the agency administrative report (AAR) on October 23, 2019. For the reasons discussed herein, the claim is denied.
The claimant previously occupied a Federal civilian position with the United States Air Forces in Europe (USAFE) at Ramstein Air Base, Germany. The USAFE permitted furniture rental as an allowable cost associated with an approved LQA. The claimant was thus authorized the cost for expenses associated with the 32-month furniture rental agreement he signed to in December 2015. The claimant subsequently applied and was selected for his current DA position in Sembach, Germany. In its January 25, 2018, official job offer, the DA’s servicing civilian personnel advisory center stated he would be entitled to LQA and that there would be “[n]o change in current benefits.” Shortly after receipt of the job offer, the claimant was made aware the DA would not grant furniture rental as an allowable LQA expense. He nonetheless accepted the DA position. Effective March 4, 2018, the claimant was placed in his current position on a provisional appointment not to exceed June 1, 2018, which was later converted to a career-conditional appointment.
The Department of State Standardized Regulations (DSSR) contain the governing regulations for allowances, differentials, and defraying of official residence expenses in foreign areas. Within the scope of these regulations, the head of an agency may issue further implementing instructions for the guidance of the agency with regard to the granting of and accounting for these payments. Thus, the Department of Defense Instruction (DoDI) 1400.25, Volume 1250, Army in Europe Regulation (AER) 690-500.592, and other guidance implement the provisions of the DSSR but may not exceed their scope; i.e., extend benefits that are not otherwise permitted under the DSSR. Therefore, an LQA applicant must fully meet the relevant provisions of the DSSR before the supplemental requirements of the agency implementing guidance may be applied.
DSSR Section 131.3, Scope, states LQA rates are intended to “cover substantially all of the average employee’s costs for rent…” DSSR Section 131.2 defines “rent,” in relevant part, as:
“Rent”, exclusive of heat, light, fuel (including gas and electricity), water and taxes, means the annual cost of suitable, adequate living quarters for an employee and his/her family. When approved by the head of agency as necessary to provide such living quarters, rent may include in addition to the basic annual rental, the cost of…(2) separate rental of necessary furniture at not to exceed 25 percent of the applicable maximum annual quarters allowance rate, meaning rental of necessary basic furniture and/or equipment, etc., but exclusive of pianos, other musical instruments, radios, television sets, etc. from source other than the landlord (rental of furniture and/or space from the same source under two agreements or contracts is considered to be rental of “furnished quarters”)…
The language used in DSSR Section 131.2 is permissive rather than mandatory. By the use of the permissive term “may” (i.e., in relation to “rent may include in addition to the basic annual rental…”), agencies are granted discretionary authority to determine the allowance costs that may be granted to an eligible employee for suitable, adequate living quarters.
To this end, the July 29, 2013, memorandum issued by the DA’s Office of the Deputy Chief of Staff, G1, for the Civilian Human Resources Agency-Europe, “SUBJECT: Interim Guidance for [LQA] – Furniture Rental,” states the following:
Effective immediately, all requests for separate rental of furniture submitted by employees under the provisions of DSSR Section 131.2 and who are eligible for LQA under the relevant sections of the DSSR…shall not be approved. However, an exception to this rule may be considered for extraordinary circumstances. All such requests for exception must be submitted to this office for review and approval. The requests must include
(1) a justification of the need for the separate rental of furniture;
(2) an inventory listing of items shipped under official government travel and transportation orders; and
(3) an endorsement by the employee’s supervisory chain-of-command, not below the deputy or equivalent level.
The DA subsequently incorporated the furniture rental policies in AER 690-500.592, dated October 26, 2017, which was in effect at the time of the claimant’s LQA determination.
In its July 31, 2018, denial of the claimant’s request to include furniture rental as an allowable cost associated with his LQA, the agency explains:
While we previously authorized the use of LQA to reimburse for expenses associated with rental furniture, albeit for only a very short period of time for any type of rental furniture, we discontinued the practice in July 2013 and limited the grant only in circumstances where employees had a need to rent the furniture as they would not have furniture of their own as result of extraordinary circumstances, such as a fire or flood in the quarters. Based on your own admission and the rental contract you provided, the furniture that you do rent is not rented to meet a need, thereby not rising to the level of an extraordinary situation.
Relying on the explicit language of DA’s July 2013, memorandum and AER 690-500.592, it is clear a furniture rental request would only be approved by means of an exception to agency regulations or policy for extraordinary circumstances. Neither the claimant nor agency indicate a request meeting the requirements established by the implementing guidance had been submitted. The agency nonetheless explains in its July 2018, denial that the claimant’s situation would fail to meet the “extraordinary circumstances” required for approval of any such exception. OPM adjudicates compensation claims for certain Federal employees under the authority of section 3702(a)(2) of title 31, United States Code (U.S.C.). The authority in 31 U.S.C. 3702(a)(2) is narrow and limited to determining if monies are owed the claimant under the controlling statutes or regulations. It does not include authority to grant an exception to agency regulations or policy. In this case, the agency has not violated its authority in implementing further guidance concerning allowable costs associated with LQA. Furthermore, we find no reason to disturb its decision to deny the claimant’s request based on implementing LQA guidance regarding furniture rental in connection with LQA.
The claimant’s rationale is based solely on the statement in his job offer letter that there would be “[n]o change in current benefits,” thus appearing to equate his offer letter to that of a binding contract or promise. It is well established that where a Federal employee holds his or her position by virtue of appointment, any entitlement to compensation must be based solely on the applicable statutes and regulations, and those statutes and regulations do not give rise to an implied-in-fact contract. See Chu v. United States, 773 F.2d 1226, 1229 (Fed.Cir. 1985) (“[A]bsent specific legislation, federal employees derive the benefits and emoluments of their positions from appointment rather than from any contractual or quasi-contractual relationship with the government;” see also Schism v. United States, 316 F.3d 1259, 1275 (Fed.Cir. 2002)(noting that “[f]ederal employees, both military and civilian, serve by appointment, not contract…”)). Therefore, the Government’s offer letter for the claimant’s position and by extension any benefits extended therein are not considered a contract and thus not legally binding. See OPM File Numbers 13-0001 and 14-0051.
Further, it is well settled by the courts that a claim may not be granted based on misinformation provided by agency officials. Payments of money from the Federal Treasury are limited to those authorized by law, and erroneous advice or information provided by a Government employee cannot bar the Government from denying benefits which are not otherwise permitted by law. See Office of Personnel Management v. Richmond, 496 U.S. 414, rehearing denied, 497 U.S. 1046, 111 S. Ct. 5 (1990). Therefore, that the claimant was told there would be “[n]o change in current benefits” does not confer eligibility not otherwise permitted by statute or its implementing regulations.
DoDI 1400.25-V1250 specifies that overseas allowances are not automatic salary supplements, nor are they entitlements. Furthermore, the statutory and regulatory languages are permissive and give agency heads considerable discretion in determining whether to grant LQAs to agency employees. Wesley L. Goecker, 58 Comp. Gen. 738 (1979). Thus, an agency may withhold LQA payments from an employee when it finds that the circumstances justify such action, and the agency’s action will not be questioned unless it is determined that the agency’s action was arbitrary, capricious, or unreasonable. Under 5 CFR 178.105, the burden is upon the claimant to establish the liability of the United States and the claimant’s right to payment. Joseph P. Carrigan, 60 Comp. Gen. 243, 247 (1981); Wesley L. Goecker, 58 Comp. Gen. 738 (1979). As discussed previously, the claimant has failed to do so. Since an agency decision made in accordance with established regulations as is evident in the present case cannot be considered arbitrary, capricious, or unreasonable, there is no basis upon which to reverse the decision. Accordingly, the claim is denied.
This settlement is final. No further administrative review is available within OPM. Nothing in this settlement limits the claimant’s right to bring an action in an appropriate United States court.