Washington, DC
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Rota, Spain
Damon B. Ford
Compensation and Leave Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance
10/10/2019
Date
The claimant is a Federal civilian employee of the Department of the Navy (Navy), in Rota, Spain. He requests the U.S. Office of Personnel Management (OPM) reconsider the agency’s denial of his request for living quarters allowance (LQA) and associated allowances. We received a claim request on October 2, 2018, the agency administrative report (AAR) on July 3, 2019, and the claimant’s response to the AAR on July 8, 2019. For the reasons discussed herein, the claim is denied.
In September 2000, while serving on active duty in the Navy and stationed in Spain, the claimant purchased a home in Rota, Spain. He lived in the property while employed by a private firm in Spain from May 2008 to February 2013. Thereafter, the claimant returned to the United States and while living in Florida and working for a private firm in Georgia, he applied for his current Federal civilian position of Technical Information Specialist, GS-1412-09, in Rota, Spain. He received a tentative offer for the position on October 26, 2017. He applied and was determined ineligible for LQA by Navy’s Rota human resources office (HRO) on February 1, 2018. Nonetheless, the claimant accepted the position without LQA and was appointed effective March 11, 2018. Subsequently, the local HRO’s decision to deny LQA to the claimant was affirmed by the region HRO on August 13, 2018, and concurred by Navy’s Office of Civilian Human Resources on September 7, 2018. The claimant disagrees with his agency’s decision to deny him LQA, asserting it contradicts the provisions of the Department of State Standardized Regulations (DSSR) section 136(a) relating to LQA for personally owned quarters (POQ). Additionally, he states the denial of LQA impacted his receipt of temporary quarters subsistence allowance (TQSA).
In its AAR to OPM, the agency explained its decision as follows:
In accordance with reference DSSR Section 031.11, Mr. White meets the basic eligibility requirements for LQA as an individual recruited from the U.S. The DoDI 1400.25 V1250 establishes additional Department of Defense policy concerning the granting of LQA, specifically that overseas allowances and differentials are not automatic salary supplements, nor are they entitlements. They are specifically intended to be recruitment incentives for U.S. citizen civilian employees living in the U.S. to accept Federal employment in a foreign area. Individuals shall not automatically be granted these benefits simply because they meet eligibility requirements.
The claim should be denied. It was determined that in this case, the use of LQA was not a necessary incentive for Mr. White to accept a position in Rota, Spain. He was already willing to move to Rota, Spain due to already owning a home in that location as he did in 2008 to 2013. Furthermore, prior to his acceptance of the position, Mr. White was advised of the LQA determination and he report [sic] to his new positon in March 2018. This determination was made consistent with past and current Department of the Navy practice.
The DSSR contains the governing regulations for allowances, differentials, and defraying of official residence expenses in foreign areas. Section 013 of the DSSR, addressing the authority delegated to the heads of agencies, states in part:
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. [Emphasis added]
Thus, the Department of Defense Instruction (DoDI) 1400.25, Volume 1250, dated February 23, 2012, and in effect during the claim period, may impose additional requirements to further restrict LQA eligibility, but may not exceed the scope of the DSSR; i.e., allow for the granting of LQA in cases not otherwise permitted under the DSSR.
DoDI 1400.25-V1250, which provides Department of Defense policy for the granting of LQA, provides the following:
Overseas allowances and differentials (except the post allowance) are not automatic salary supplements, nor are they entitlements. They are specifically intended to be recruitment incentives for U.S. citizen civilian employees living in the United States to accept Federal employment in a foreign area. If a person is already living in the foreign area, that inducement is normally unnecessary. Individuals shall not automatically be granted these benefits simply because they meet eligibility requirements. [Emphasis added]
There is no dispute that the claimant met eligibility requirements for LQA under DSSR section 031.11, as an employee recruited in the United States. However, the use of the permissive term "may" in DSSR section 013 as opposed to the mandatory terms "will" or "shall" indicate that LQA is a discretionary allowance on the part of the agency. The agency’s position is that it has consistently denied LQA to employees who own or maintain a home at the location of assignment. Further, in accordance with DoDI 1400.25, in its September 7, 2018 decision, the agency states the purpose of LQA is to "incentivize eligible qualified candidates to accept overseas employment," and "given the claimant’s ownership of local housing, such inducement was deemed unnecessary." Therefore, although the claimant met LQA eligibility requirements under DSSR 031.11, the agency’s decision to deny the claimant LQA is within its discretionary authority under DSSR section 013 and in accordance with implementing instructions of the DoDI.
Under statutes that vest a degree of discretion to administrative agencies, our review is generally confined to deciding whether an agency’s action must be viewed as arbitrary, capricious, or so at variance with the established facts as to render its conclusion unreasonable. Therefore, 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). Here, the claimant has failed to meet that burden. Since an agency decision made in accordance with established regulations and within its discretionary authority, 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.
Regarding the claimant’s concerns for receipt of TQSA, DSSR section 111 defines "quarters allowance" as an allowance granted under sections 120 (TQSA) or 130 (LQA) of these regulations. Eligibility requirements for quarters allowances set forth in Section 031 do not distinguish between LQA and TQSA, the latter of which covers only transient quarters occupied before the permanent quarters covered by LQA are secured. Thus, eligibility for TQSA is dependent on eligibility for LQA and may not be considered separately. However, we may not render a decision on this matter in that TQSA is a lodging expense. As such, TQSA claims fall under the jurisdiction of the General Services Administration’s Civilian Board of Contract Appeals.
Lastly, in his response to the AAR the claimant states, "If I would have been told up-front that I would not receive LQA my decision to work in Spain would have been much different, but only finding out after my arrival and with no opportunity to return to my previous private employment I have been forced to accept this unfair decision at a great impact to my family’s wellbeing."
However, even if they have no actual knowledge, Federal employees are charged with constructive knowledge of statutory requirements pertaining to them and of the implementing regulations and policies authorized to be issued by statute. See B-173927, October 27, 1971; B-187104, April 1, 1977; and B-192510, April 6, 1979.
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.