Washington, D.C.
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
and Distribution Command
598th U.S. Army Transportation Brigade
Sembach, Germany
Kimberly A. Steide, DPA
Principal Deputy Associate Director
Agency Compliance and Evaluation
Merit System Accountability and Compliance
08/21/2025
Date
The claimant is currently a Federal civilian employee of the U.S. Department of the Army (hereafter referred to as “agency” or “Army), assigned to the U.S. Army Military Surface Deployment and Distribution Command, 598th U.S. Army Transportation Brigade in Sembach, Germany. He requests the U.S. Office of Personnel Management (OPM) reconsider the agency’s denial of living quarters allowance (LQA). We received the claim on May 19, 2025, and the agency administrative report on July 15, 2025. For the reasons discussed herein, the claim is denied.
The claimant is currently assigned to an Information Technology Specialist (Systems Administration/ Customer Support), GS-2210-11, with the U.S. Army Military Surface Deployment and Distribution Command, 598th U.S. Army Transportation Brigade in Sembach, Germany, effective January 27, 2025. Prior to appointment, the claimant was employed with the U.S. Department of Defense Education Agency (DODEA) in Sembach, Germany. While employed with DODEA, the claimant was considered eligible for and received LQA. On July 17, 2024, the claimant requested DODEA approve a delay in separation travel beyond the established 90 days until August 1, 2025. This request was denied. On August 1, 2024, the claimant separated from his employment with DODEA. In and around this time, the claimant applied for his current position with the Army. On September 13, 2024, the claimant received a tentative offer of employment, which he accepted the same day. On October 24, 2024, the clamant received a memorandum confirming that he had yet to use his return transportation rights, which were set to expire on October 30, 2024. On May 15, 2025, the claimant was determined ineligible to receive LQA for not having intact return transportation rights prior to appointment. On May 19, 2025, the claimant filed a compensation claim with OPM requesting a reversal of the agency’s LQA determination, citing that he had “not left the overseas location or used any portion of the [return transportation] orders to return stateside.”
The Department of State Standardized Regulations (DSSR) set forth basic eligibility criteria for the granting of LQA. The DSSR contains the governing regulations for allowances, differentials, and defraying of official residence expenses in foreign areas. Under DSSR section 031.11, LQA may be granted to employees recruited in the United States. It states in part:
Quarters allowances prescribed in Chapter 100 may be granted to employees who were recruited by the employing government agency in the United States, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, and the possessions of the United States.
According to the record, the claimant applied for the Information Technology Specialist (Systems Administration/ Customer Support), GS-2210-11, position, outside the United States. Therefore, the claimant did not meet section 031.11 of the DSSR at the time of his selection and was ineligible for LQA as a stateside hire.
The agency also determined the claimant did not meet the basic requirements of a non-stateside hire under DSSR section 031.12, which states:
Quarters allowances prescribed in Chapter 100 may be granted to employees recruited outside the United States, provided that:
a. the employee’s actual place of residence in the place to which the quarters allowance applies at the time of receipt thereof shall be fairly attributable to his/her employment by the United States Government; and
b. prior to appointment, the employee was recruited in the United States, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, the former Canal Zone, or a possession of the United States, by:
1. the United States Government, including its Armed Forces;
2. a United States firm, organization, or interest;
3. an international organization in which the United States Government participates; or
4. a foreign government
and had been in substantially continuous employment by such employer under conditions which provided for his/her return transportation to the United States, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, the former Canal Zone, or a possession of the United States.
The claimant meets DSSR 031.12a in that his presence in Germany is fairly attributable to his current employment as an Information Technology Specialist (Systems Administration/ Customer Support), GS-2210-11, in Sembach, Germany.
However, under DSSR section 031.12b, an employee recruited outside the United States must, immediately prior to appointment, have been recruited in the United States by one of the enumerated entities which provided return transportation rights back to the United States. On July 17, 2024, the claimant requested an extension on his return transportation rights, which were set to expire within 90 days of his separation from DODEA, but the extension was denied. On August 1, 2024, the claimant separated from DODEA. On September 13, 2024, the claimant received and accepted a tentative offer of employment from Army. On October 24, 2024, the claimant received a memorandum entitled, “Non-Use of Shipping Entitlements” in which he was informed that his “personal military transportation and shipping entitlements” had not been used as of that date. On October 30, 2024, the claimant’s transportation entitlements expired. As a result of the loss of his transportation entitlements, the agency determined the claimant ineligible to receive LQA. Nevertheless, the claimant asserts that he never “left the overseas location or used any portion of the [transportation] orders to return stateside.” Therefore, he contends he should be determined eligible to receive LQA, as he maintained his transportation entitlements until they expired.
However, the claimant’s loss of his transportation benefits means he no longer held intact return transportation rights. Thus, upon the entitlement’s expiration, the claimant could no longer be considered to have been recruited outside the United States for the purpose of DSSR section 031.12b, and the employment conditions it describes, which are based on the premise that, prior to appointment, the individual is employed overseas by one of the qualifying entities with return transportation entitlements to the United States. The claimant’s transportation entitlements were not intact prior to appointment and, therefore, DSSR section 031.12b is not met.
In addition, the Department of Defense Instruction (DODI) 1400.25 V1250 paragraph E2. 2a, states that “civilian members shall be considered to have “substantially continuous employment” for up to 1 year from the date of separation or when transportation entitlement is lost, or until the retired or separated member or employee uses any portion of the entitlement for Government transportation back to the United States, whichever occurs first.” Despite the claimant’s contention that he did not use the transportation entitlements to return stateside, the loss of the benefit meant that he could no longer be considered to have “substantially continuous employment” as stipulated in DSSR section 031.12b.
Furthermore, the DODI 1400.25 V1250 specifies that overseas allowances are not automatic salary supplements, nor are they entitlements. The statutory and regulatory languages are permissive and give agency heads considerable discretion in determining whether to grant LQA to agency employees. Thus, an agency may deny LQA 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. Joseph P. Carrigan, 60 Comp. Gen. 243, 247 (1981); Wesley L. Goecker, 58 Comp. Gen. 738 (1979). In this case, the claimant failed to do so. 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 on which to reverse the agency’s decision, and the claim is therefore denied.
This settlement is final. No further administrative review is available within the OPM. Nothing in this settlement limits the claimant’s right to bring an action in an appropriate United States court.