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Policy, Data, Oversight Pay & Leave

Washington, DC

U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code

Timothy S. Lynch
Department of the Air Force
Ramstein Air Base, Germany
LQA (payment for rental quarters w/ concurrent ownership of POQ)
Denied
Denied
14-0046

Robert D. Hendler
Classification and Pay Claims Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance


08/19/2014


Date

The claimant is a Federal civilian employee of the Department of the Air Force at Ramstein Air Base, Germany.  He requests the U.S. Office of Personnel Management (OPM) reconsider his agency's denial of his waiver request for continuance of living quarters allowance (LQA) for rental quarters following his occupancy of personally owned quarters (POQ).  We accepted the claim on July 9, 2014.  For the reasons discussed herein, the claim is denied.

The claimant seeks exemption from a regulatory change contained in Department of Defense Instruction (DoDI) 1400 25-V1250, paragraph E2.2.1, dated February 23, 2012, which prohibits the payment of LQA for rental quarters if the employee owns POQ in the local area of work.  The claimant occupied POQ for which he had received LQA for almost ten years.  The regulatory change was issued shortly after his move to rental quarters in January 2012.  The agency notified the claimant by letter dated August 6, 2012, that the rental portion of his LQA would be terminated retroactive to June 28, 2012, but that he was granted a grace period to September 30, 2012, to sell the POQ and thereby restore his eligibility for the rental portion of his LQA. 

The claimant asserts he should continue to receive LQA because his decision to move from his POQ to rental quarters was predicated on guidance he received at the time (prior to the regulatory change) from agency human resources staff that "the LQA payment would be paid by DoD [Department of Defense] on a permanent basis," and because his failure to secure employment in the United States under the Priority Placement Program (PPP) necessitates his continuing residency in Germany.  He asserts he should not be penalized for "taking advantage of that legal loophole" which allowed employees to receive LQA for rental quarters while collecting rent on an LQA-financed POQ, particularly without "pre-notification that the rules and regulations were going to change," and that the agency's selection of the September 30, 2012, date as the grace period was an "unrealistic timeframe."  He also asserts that the agency's position expressed to him in an email dated August 7, 2012, that AF has "no authority to allow deviation from the rules as put forth by the modified DoDI" is incorrect.  

The Department of State Standardized Regulations (DSSR) contain the governing regulations for allowances, differentials, and defraying of official residence expenses in foreign areas.  However, under section 013, they allow agencies to issue 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.

Section 136 of the DSSR addressing POQ states:

a.  When quarters occupied by an employee are owned by the employee or the spouse, or both, an amount up to 10 percent of original purchase price (converted to U.S. dollars at original exchange rate) of such quarters shall be considered the annual rate of his/her estimated expenses for rent.  Only the expenses for heat, light, fuel (including gas and electricity), water, garbage and trash disposal and in rare cases land rent, may be added to determine the amount of the employee's quarters allowance in accordance with Section 134.  The amount of the rental portion of the allowance (up to 10 percent of purchase price) is limited to a period not to exceed ten years at which time the employee will be entitled only to above utility expenses, garbage and trash disposal, plus land rent.
b.  The following transactions shall not be considered to meet the intent of these regulations so as to warrant payment of the rental portion of living quarters allowance beyond the initial ten year period specified in Part a:

(1)   sale or gift of quarters owned by the employee or the spouse, or both with employee remaining in the same quarters, or
(2)   the purchase or exchange and move to other quarters in daily commuting distance of the same post.

Payment for utilities and (if necessary) land rent may be continued beyond the 10 year period.  The head of   agency may waive provisions of Part b in unusual circumstances.

The claimant is not eligible for waiver by the head of agency (i.e., AF) under DSSR section 136b because he is not requesting extension of the ten-year period for receipt of LQA for POQ, but rather a separate grant of LQA for rental quarters following the POQ grant.  Relevant to this request, the implementing regulations contained in DoDI 1400.25-V1250, state in paragraph E2.2.l.:

The annual rent payable for personally owned quarters (POQ) is based on the purchase price or appraised value of the property, converted to U.S. dollars at the exchange rate in effect at the time of purchase.  Employees who own, or are purchasing a POQ, may not be paid quarters allowances under a rental contract if the POQ is within the employee's local area of work.  [Italics added.]

Thus, DoDI 1400.25-V1250 specifically prohibits the granting of LQA for rental quarters if the employee owns POQ in the local area of work.  OPM’s claims adjudication authority under 31 U.S.C. § 3702(a)(2) is narrow and limited to determining if the statutory and regulatory provisions applicable to the asserted claim have been correctly interpreted and applied.  It does not include the authority to waive or grant exception to provisions of agency regulations, nor does it extend to determining the proper timing of the implementation of agency regulatory changes or whether such changes should be grandfathered.  Therefore, OPM may not consider the claimant’s request for a waiver within the context of the claims adjudication function it performs under section 31 U.S.C. § 3702(a)(2).  The claimant's personal circumstances (i.e., his failure to secure U.S. employment under the PPP) have no bearing on these limits to our adjudicative authority.

The claimant asserts that "[n]othing in the DoD instruction states that POQ payments may not resume at any time after the POQ is sold," and asks OPM to provide "any reference material to accept/reject" his assumption that "if [he] were to sell the POQ, for example, next year, LQA payments must resume immediately upon sale of the POQ."  As noted above, OPM's authority is limited to determining if monies are owed under the governing statutes and regulations for the stated claim.  We do not provide regulatory guidance regarding speculatory circumstances.  

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 statute, and erroneous advice given by a Government employee cannot bar the Government from denying benefits not otherwise permitted by law.  See OPM v. Richmond, 496 U.S. 414, 425-426 (1990); Falso v. OPM, 116 F.3d 459 (Fed.Cir. 1997); and 60 Comp. Gen. 417 (1981).  Therefore, that the claimant was advised, before issuance of the regulatory change, that his LQA for rental quarters would be continued after he vacated his POQ does not confer eligibility not otherwise permitted by statute or regulations.

Although not specifically presented as part of his claim, the claimant questions "why relocation (in both directions) costs would not be paid back to me."  Pursuant to 31 U.S.C. § 3702(a)(3), the U.S. General Services Administration (GSA) is responsible for issuing regulations on travel, transportation, and subsistence expenses and allowances, including relocation expenses, for Federal civilian employees as authorized in chapter 57 of title 5, U.S.C.  GSA's Civilian Board of Contract Appeals is responsible for settling travel, transportation, and subsistence claims. (See http://www.cbca.gsa.gov/).

The claimant asserts his "LQA benefit should continue indefinitely" until his return to the United States or retirement because his "initial job offer at Ramstein Air Base included payment of LQA."  However, 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.  The agency exercised its authority under DSSR section 031 in issuing implementing regulations to restrict LQA after the ten-year period of receipt for POQ.  See Roberts v. United States, 745 F.3d 1158 (Fed. Cir. Feb. 10, 2014).

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.

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