Washington DC
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Defense Commissary Agency
Kaiserslautern, Germany
Damon B. Ford
Compensation and Leave Claims Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance
08/07/2024
Date
The claimant occupied a Federal civilian position with the Field Operating Activity, Defense Commissary Agency (DeCA), in Kaiserslautern, Germany during the claim period. She requests the U.S. Office of Personnel Management (OPM) reconsider the decision made by the Civilian Personnel Division of G1, Headquarters of United States Army Europe (hereafter referred to as “agency”), to deny her request for retroactive payment of living quarters allowance (LQA). She specifically requests an exception to the policy in paragraph 5.f.(2) of the Army in Europe Regulation (AER) 690-500.592 to allow for reimbursement of the rent and utility costs she incurred overseas between June 14, 2021, to January 19, 2022. We received the claim on August 30, 2022, the agency administrative report (AAR) on February 17, 2023, and the claimant’s comments on the AAR on October 16, 2023. For reasons discussed herein, the claim is denied.
Effective March 28, 2021, the claimant transferred from her Federal civilian position with the Defense Finance Accounting Service (DFAS) in Franklin, Ohio, to the overseas position with DeCA.[1] She was determined eligible for LQA as an employee recruited in the United States under section 031.11 of the Department of State Standardized Regulations (DSSR). The record shows she moved into rental quarters on June 14, 2021. On November 4, 2021, the claimant submitted her LQA request through the agency’s Service Now portal which allows employees to electronically initiate and submit requests for LQA and other overseas allowances. The record shows the agency granted her LQA effective January 20, 2022, but denied her request for retroactive compensation in the amount of $17,447.35 to cover the rent and utility costs she incurred between June 14, 2021, to January 19, 2022. The agency denied her request for retroactive compensation based on paragraph 5.f.(2) of AER 690-500.592, dated September 6, 2018, which establishes that employees eligible for [living quarters] allowance will:
(2) Provide copies of their rental or lease agreement and their enrollment in the [Department of Defense] Utility Tax Avoidance Program to the [Civilian Human Resources Agency] LQA Office together with an SF 1190 [Foreign Allowances Application, Grant and Report] and DSSR 130 Worksheet in order to start their LQA. To be compensated retroactively, employees must file their SF 1190 within 90 days after occupying their quarters. Such claims will be processed prospectively from the date of SF 1190 submission. The electronic signature date on the SF 1190 is the date considered as submission of the claim.
The agency denied the claimant’s request for retroactive payment of LQA because she failed to submit her claim for LQA within 90 days of occupying her quarters as required by paragraph 5.f.(2) of AER 690-500.592.[2] In an April 5, 2022, memorandum, the Director for DeCA Headquarters’ Overseas Financial Operations Division requested an exception to the paragraph 5.f.(2) provision in AER 690-500.592 on behalf of the claimant, offering various reasons affecting the timeliness of her request for LQA. On May 19, 2022, the agency denied the request, stating in part, “…an approval of an exception to policy, here the AER 690-500.592, which does not provide for a waiver or an exception in the matter at hand, would be inconsistent with the guidance.”
The DSSR contain the governing regulations for allowances, differentials, and defraying of official residence expenses in foreign areas. Section 013 of the DSSR allows heads of agencies to issue further implementing regulations as follows:
When authorized by law, the head of an agency may defray official residence expenses for, and grant post differential, difficult to staff incentive differential, danger pay allowance, quarters, cost-of-living, representation allowances, compensatory time off at certain posts and advances of pay to an employee of his/her agency and require an accounting thereof, subject to the provisions of these regulations and the availability of funds. Within the scope of these regulations, the head of an agency may issue such further implementing regulations as he/she may deem necessary for the guidance of his/her agency with regard to the granting of and accounting for these payments.
Within the scope of the DSSR, an agency may, as done here, issue further implementing instructions for the guidance of its agency with regard to the granting of and accounting for LQA payments. Because LQA is a discretionary allowance, agency implementing regulations and/or policies may be more restrictive, but not more permissive, than the DSSR; i.e., they may impose additional limitations on the granting of LQA. Thus, OPM applies agency-developed policies to the extent such guidance is in agreement with the DSSR. In this case, the agency has not violated its authority in implementing further restrictions concerning the grant of LQA. We find no reason to disturb its decision to deny the claimant’s request for retroactive payment of LQA based on provisions of paragraph 5.f.(2) of AER 690-500.592.
The claimant acknowledges the failure to submit her LQA request within 90 days of occupying her rental quarters, thus in conflict with the requirement in paragraph 5.f.(2) of AER 690-500.592. As noted above, she seeks reconsideration of the agency’s decision to deny the request for exception to agency policy. As written, exceptions to policy may be requested from the agency, which has already denied the claimant’s request for 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. Section 3702 does not include the authority to waive agency policy. OPM does not consider the claimant’s request for an exception to policy within the context of the claims adjudication function it performs under 31 U.S.C. 3702(a)(2). Therefore, OPM is without authority to grant the request for an exception to agency policy.
In addition, the claimant states in her AAR comments that the “language stated in AER 690-500-592 is permissive vs mandatory,” suggesting it is within the agency’s discretionary authority to make retroactive LQA payments to employees despite explicit filing requirements. However, we note paragraph 5.f.(2) of AER 690-500.592 states that employees “must” file their allowance application within 90 days after occupying their quarters. The use of the mandatory term “must” as opposed to the permissive term “may” undermines the claimant’s assertion regarding the agency’s discretionary authority to disregard filing requirements.
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 section 178.105 of title 5, Code of Federal Regulations, the burden is upon the claimant to establish the liability of the United States and the claimant’s right to payment. The claimant has failed to do so. Accordingly, the claim for retroactive payment of LQA 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.
[1] The agency states the claimant subsequently returned to her prior Federal civilian position with DFAS on or around April 21, 2022.
[2] We note the claimant identified October 18, 2021, as the due date for submitting a timely request for retroactive compensation, asserting her submission was only 13 days past the due date. The agency states in its administrative report to OPM that the 90-day window closed on September 11, 2021, not October 18, 2021, as identified by the claimant. Regardless, that the claimant submitted her LQA request past the 90-day threshold required by paragraph 5.f.(2) of AER 690-500.592 is not in dispute. Therefore, the discrepancy in due dates identified by the claimant and agency is immaterial for purposes of our claim determination.