Washington, DC
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
U.S. Department of the Air Force
Stuttgart, Germany
Damon B. Ford
Compensation and Leave Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance
06/23/2020
Date
The claimant is a Federal civilian employee of the Air Force Space Command, U.S. Department of the Air Force (AF), in Stuttgart, Germany. He requests the U.S. Office of Personnel Management (OPM) reverse his agency’s denial of property taxes as a reimbursable expense in connection with his living quarters allowance (LQA) for the period of December 18, 2017, to December 31, 2018. We received the claim on November 7, 2019, and the agency administrative report (AAR) on December 3, 2019. For the reasons discussed herein, the claim is denied.
In late 2017, the claimant was granted LQA upon his promotion to an overseas position in Stuttgart, Germany. On August 14, 2019, he signed and submitted an LQA worksheet to the agency for review and reconciliation for 2017-18. In the worksheet he included a property tax expense of €351.79. Thereafter, the agency completed its reconciliation calculation to determine the expenses it would reimburse the claimant for; however, the property taxes expense was not considered.
To support his claim for reimbursement of the property taxes expense, the claimant relies on section 131.3 in the Department of State Standardized Regulations (DSSR), which provides in relevant part:
The LQA rates are designed to cover substantially all of the average employee’s costs for rent, heat, light, fuel, gas, electricity, water, taxes levied by the local government and required by law or custom to be paid by the lessee… [Emphasis added]
The agency asserts that it is aware of DSSR 131.3, however it explains that tenants are not required by law or custom to pay property taxes in Germany. In a memorandum, dated September 30, 2019, the agency states, in part:
…In the case of the property taxes the payment is not required by law to be paid by the lessee. It is also not customary. Customary means that the lessee would generally, normally, or commonly be charged for this tax, however you are one of only a few of LQA recipients within our servicing responsibility who are charged this tax out of over 500 employees. Additionally we have HAF (Headquarters Air Force) clarification that taxes are not reimbursable as LQA…
The DSSR section 131.3 makes clear that LQA rates are designed to cover property taxes only when required by custom or law to be paid by the lessee. Applying this section to the facts of this claim, we have determined that the claimant’s property taxes expense is not covered. As the agency points out, tenants are not required by law or custom to pay property taxes in Germany and the claimant offers no evidence to the contrary. Therefore, the claim is denied.
We note in further support of his request, the claimant submitted Appendix A of the Army in Europe Regulation (AER) 690-500.592, dated September 6, 2018. Appendix A lists LQA reimbursable expenses for appropriated fund civilian employees of the U.S. Army in Europe. The claimant infers he should be reimbursed for the property taxes because it is allowed by AER 690-500.592, Appendix A. However, AER 690-500.592 applies to U.S. Department of Army appropriated fund civilian employees employed by U.S. Army in Europe. The regulations do not apply to employees in the U.S. Air Force, such as the claimant.
The statutory and regulatory languages regarding LQA are permissive and give agency heads considerable discretion in determining whether to grant LQA to agency employees. Thus, agencies have the authority to deny or withhold LQA payments from an employee when governing regulations justify such actions. OPM does not question an agency’s decision to deny or withhold LQA unless the agency’s actions are determined to be 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.
Lastly, the claimant raises concerns about the fairness of how the AF and Army make LQA determinations. The claims jurisdiction authority of OPM under 31 United States Code 3702(a)(2) is limited to consideration of whether the applicable statutes and regulations have been properly interpreted and applied in determining if monies are owed for the stated compensation or leave claim. Therefore, the claimant’s concerns about the consistency with which AF and Army officials implement the DSSR has no applicability to our claim settlement determination.
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.