[Federal Register Volume 62, Number 55 (Friday, March 21, 1997)]
[Rules and Regulations]
[Pages 13763-13764]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-7185]
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GENERAL SERVICES ADMINISTRATION
41 CFR Part 302-14
[FTR Amendment 61]
RIN 3090-AG22
Federal Travel Regulation; Home Marketing Incentive Payments
AGENCY: Office of Governmentwide Policy, GSA.
ACTION: Final rule.
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SUMMARY: This final rule amends the Federal Travel Regulation (FTR) to
allow an agency to pay a home marketing incentive to a transferred
employee who uses the agency s homesale program provided by a
relocation services company under contract with the Government and who
independently and aggressively markets, and finds a bona fide buyer
for, his/her residence resulting in significantly lower fee/expense
payments the agency must make to the relocation services company. This
amendment will save the Government money through reduced payments to
relocation services companies and will increase employee satisfaction
with the relocation process.
DATES: This final rule is effective March 22, 1997, and applies to an
employee whose effective date of transfer (date the employee reports
for duty at the new official station) is on or after March 22, 1997.
FOR FURTHER INFORMATION CONTACT: Robert A. Clauson, Travel and
Transportation Management Policy Division (MTT), Washington, DC 20405,
telephone 202-501-0299.
SUPPLEMENTARY INFORMATION: A multi-agency travel reinvention task force
was organized in August 1994 under the auspices of the Joint Financial
Management Improvement Program (JFMIP) to reengineer Federal travel
rules and procedures. The task force developed 25 recommended travel
management improvements published in a JFMIP report entitled Improving
Travel Management Governmentwide, dated December 1995. On September 23,
1996, the President signed into law the Federal Employee Travel Reform
Act of 1996 (Pub. L. No. 104-201), which included 8 legislative changes
recommended by the JFMIP to improve travel and the delivery of
relocation services.
This amendment implements section 1717 of the Act which provides
the General Services Administration (GSA) authority to issue
regulations which authorize agencies to pay a home marketing incentive
to a transferred employee to facilitate sale of the employee s
residence at the old official station at lower overall cost to the
Government when the employee uses the agency s homesale program
provided by a relocation services company under contract with the
Government. This amendment is written in the ``plain English'' style of
regulation writing as a continuation of GSA s effort to make the FTR
easier to understand and to use.
What is a ``homesale program''?
A program under which a relocation services company, under contract
with the agency, purchases a transferred employee s residence at fair
market (appraised) value and then independently markets and sells the
residence.
What is the ``home marketing incentive payment''?
This is a payment an agency makes to its transferred employee to
encourage the employee to independently and aggressively market his/her
residence and find a bona fide buyer, thereby reducing the fee/expenses
the agency must pay the relocation services company. The amount of the
incentive payment may not exceed five percent of the price the
relocation services company paid the employee for his/her residence, or
the savings the agency realized from the reduced fee/expenses it paid.
Why would an agency want to institute a home marketing incentive
payment program?
With this type of program, the sum of the incentive payment and the
reduced payment to the relocation services company is less than the
fee/expenses the agency must pay the relocation services company when
the company has to find a buyer for the residence.
What is the ``plain English'' style of regulation writing?
The ``plain English'' style of regulation writing is a new, simpler
to read and understand, question and answer regulatory format.
Questions are in the first person and answers are in the second person.
GSA uses a ``we'' question when referring to an agency and an ``I''
question when referring to the employee.
How does the plain English style of regulation writing affect
employees?
A question and its answer combine to establish a rule. The employee
and the agency must follow the language contained in both the question
and its answer.
GSA has determined that this rule is not a significant regulatory
action for the purposes of Executive Order 12866 of September 30, 1993.
This final rule is not required to be published in the Federal Register
for notice and comment. Therefore, the Regulatory Flexibility Act does
not apply. This rule also is exempt from Congressional review
prescribed under 5 U.S.C. 801 since it relates solely to agency
management and personnel.
List of Subjects in 41 CFR Part 302-14
Government employees, Travel and transportation expenses.
For the reasons set out in the preamble, 41 CFR part 302-14 is
added to read as follows:
PART 302-14--HOME MARKETING INCENTIVE PAYMENTS
Subpart A--Payment of Incentive to the Employee
Sec.
302-14.1 What is a ``homesale program''?
302-14.2 What is the purpose of a home marketing incentive payment?
302-14.3 Am I eligible to receive a home marketing incentive
payment?
[[Page 13764]]
302-14.4 Must my agency pay me a home marketing incentive?
302-14.5 Under what circumstances will I receive a home marketing
incentive payment?
302-14.6 How much may my agency pay me for a home marketing
incentive?
302-14.7 Are there tax consequences when I receive a home marketing
incentive payment?
Subpart B--Agency Responsibilities
302-14.100 How should we administer our home marketing incentive
payment program?
302-14.101 What policies must we establish to govern our home
marketing incentive payment program?
302-14.102 What factors should we consider in determining whether
to establish a home marketing incentive payment program?
302-14.103 What factors should we consider in determining the
amount of a home marketing incentive payment?
Authority: 5 U.S.C. 5756.
Subpart A--Payment of Incentive to the Employee
Note to subpart A: Use of the pronouns ``I'' and ``you''
throughout this subpart refers to the employee.
Sec. 302-14.1 What is a ``homesale program''?
It is a program offered by an agency through a contractual
arrangement with a relocation services company. The relocation services
company purchases a transferred employee s residence at fair market
(appraised) value and then independently markets and sells the
residence.
Sec. 302-14.2 What is the purpose of a home marketing incentive
payment?
To reduce the Government s relocation costs by encouraging
transferred employees who participate in their employing agency s
homesale program to independently and aggressively market, and find a
bona fide buyer for, their residence. This significantly reduces the
fees/expenses their agencies must pay to relocation services companies
and effectively lowers the cost of such programs.
Sec. 302-14.3 Am I eligible to receive a home marketing incentive
payment?
Yes, if you are an employee who is authorized to transfer and you
otherwise meet requirements for sale of your residence at Government
expense.
Sec. 302-14.4 Must my agency pay me a home marketing incentive?
No. Your agency determines when it is in the Government s interest
to offer you a home marketing incentive.
Sec. 302-14.5 Under what circumstances will I receive a home marketing
incentive payment?
You will receive a home marketing incentive payment when:
(a) You enter your residence in your agency s homesale program;
(b) You independently and aggressively market your residence;
(c) You find a bona fide buyer for your residence as a result of
your independent marketing efforts;
(d) You transfer the residence to the relocation services company;
(e) Your agency pays a reduced fee/expenses to the relocation
services company as a result of your independent marketing efforts; and
(f) You meet any additional conditions your agency has established,
including but not limited to, mandatory marketing periods, list price
guidelines, closing requirements, and residence value caps.
Sec. 302-14.6 How much may my agency pay me for a home marketing
incentive?
Your agency determines the amount of your home marketing incentive
payment. The incentive payment, however, may not exceed the lesser of:
(a) Five percent of the price the relocation services company paid
when it purchased the residence from you; or
(b) The savings your agency realized from the reduced fee/expenses
it paid as a result of your finding a bona fide buyer.
Sec. 302-14.7 Are there tax consequences when I receive a home
marketing incentive payment?
Yes, the home marketing incentive payment is considered income.
Consequently, you will be taxed, and your agency will withhold income
and employment taxes, on the home marketing incentive payment. You will
not, however, receive a withholding tax allowance (WTA) to offset the
withholding on your home marketing incentive payment, nor will you
receive a relocation income tax (RIT) allowance payment for
substantially all of your Federal, state and local income taxes on the
incentive payment.
Subpart B--Agency Responsibilities
Note to subpart B: Use of the pronouns ``we'' and ``you''
throughout this subpart refers to the agency.
Sec. 302-14.100 How should we administer our home marketing incentive
payment program?
Your goal in using an incentive payment program is to reduce your
overall relocation costs. You must not make a home marketing incentive
payment that exceeds the savings you realize from the reduced fees/
expenses you pay the relocation services company.
Sec. 302-14.101 What policies must we establish to govern our home
marketing incentive payment program?
You must establish policies to govern:
(a) The conditions under which you will authorize a home marketing
incentive payment for an employee;
(b) The amount of the home marketing incentive payment(s) you will
offer (or the method you will use to compute your home marketing
incentive payments); and
(c) Who will determine in each case whether a home marketing
incentive payment is authorized.
Sec. 302-14.102 What factors should we consider in determining whether
to establish a home marketing incentive payment program?
You should consider:
(a) Whether the program will increase the percentage of residences
sold for which employees find a bona fide buyer. You should establish a
benchmark for the percentage of residences for which you expect
employees to find a bona fide buyer resulting in lower homesale costs
to you. If your historical percentage of employee-generated sales is
below your benchmark, a home marketing incentive payment program may
benefit you.
(b) The expected net savings from a home marketing incentive
payment program.
Sec. 302-14.103 What factors should we consider in determining the
amount of a home marketing incentive payment?
You should consider:
(a) Amount of savings from reduced fee/expenses paid to the
relocation services company. The home marketing incentive payment
program is intended to reduce your relocation costs. The amount of each
home marketing incentive payment you make, therefore, must not exceed
the savings you realize from the reduced fee you pay to the relocation
services company.
(b) Employee's efforts in marketing the residence. The purpose of a
home marketing incentive payment program is to encourage a transferred
employee who participates in a homesale program to independently and
aggressively market his/her residence and find a bona fide buyer.
Dated: March 17, 1997.
Thurman M. Davis, Sr.,
Acting Administrator of General Services.
[FR Doc. 97-7185 Filed 3-20-97; 8:45 am]
BILLING CODE 6820-34-P