BNUMBER:  B-260765
DATE:  December 14, 1995
TITLE:  Reginald Cutter-Temporary Quarters Subsistence
Expenses

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Matter of:Reginald Cutter-Temporary Quarters Subsistence Expenses

File:     B-260765

Date:   December 14,  1995

DIGEST

1.  A transferred employee who rented the house he eventually 
purchased is not entitled to temporary quarters subsistence expenses 
(TQSE) for the rental period.  The record shows that the residence was 
offered to the employee for "rent or purchase"; that the employee 
rented it pending arrangements to sell his old house and seek 
financing; and that, while the employee continued to look at other 
houses during the rental period, he did so as a precaution in the 
event he was unable to purchase the house.  These facts support the 
agency's determination that the employee moved into the house with the 
intention of occupying it permanently.

2.  A transferred employee was given an advance of travel funds which 
included funds for TQSE.  The employee became indebted for TQSE 
because he failed to meet the legal requirements for payment of those 
expenses, and not because of an erroneous authorization.  Therefore, 
the advance for TQSE does not constitute an erroneous payment subject 
to waiver under 5 U.S.C.  5584 (1994).

3.  A transferred employee was erroneously authorized relocation 
expenses for his aunt and 22-year-old daughter, and was given an 
advance for those expenses.  It appears that the employee spent the 
advance in reliance on the erroneous orders and, consequently, his 
indebtedness is subject to waiver.  The case is remanded to the agency 
for computation of the debt that may be waived.

DECISION

Mr. Reginald Cutter, a civilian employee of the Department of the 
Army, appeals our Claims Group settlement, Z-2869511, Feb. 8, 1995.  
The settlement denied a portion of Mr. Cutter's temporary quarters 
subsistence expenses (TQSE), and disallowed relocation expenses for 
Mr. Cutter's aunt and 22-year-old daughter.  We affirm our Claims 
Group's determination, and hold that Mr. Cutter's indebtedness for 
TQSE is not subject to waiver.  However, since the employee spent 
funds advanced for his aunt's and daughter's relocation expenses in 
reliance on erroneous orders, his indebtedness for those expenses may 
be waived.

BACKGROUND

Mr. Cutter was authorized relocation expenses, including 60 days' 
temporary quarters subsistence expenses (TQSE), for his transfer from 
the Sacramento (California) Army Depot to a position with the 
Department of the Navy in Norfolk, Virginia.  The travel orders 
authorizing relocation expenses for Mr. Cutter's family erroneously 
included his aunt and 22-year-old daughter.

Upon arriving in Norfolk on July 27, 1993, Mr. Cutter and his family 
moved into a hotel.  On August 18, 1993, the Cutters moved into a 
house at 200 Marsh Quay in Chesapeake, Virginia, and entered into a 
lease for a month-to-month rental ending on December 15.  Mr. Cutter 
states that:

     "The property known as 200 Marsh Quay was available for rent or 
     purchase.  The property was accepted for rent or purchase, 
     contingent on the sale of property in Sacramento and securing 
     financing, Aug. 93.  We accepted the offer of renting, but did 
     not accept household goods because there was no guarantee of our 
     California property being sold immediately, and being able to 
     secure financing for purchase in Virginia . . . "  [Emphasis 
     added.]

Mr. Cutter states that he rented furniture for the house and continued 
to keep his household goods in storage.  He further states that the 
house was never taken off the market, and that twice during the rental 
period he was given 30-day notices to vacate the house because other 
parties had expressed interest in buying it.  Also, Mr. Cutter states 
that he and his family continued to look at other houses during the 
rental period.  A letter from Mr. Cutter's realtor states that he 
continued to show the Cutter's other houses from August to December 
1993, "in case our contingency contract fell through on 200 Marsh 
Quay."

On October 20, 1993, the agency extended Mr. Cutter's TQSE eligibility 
for another 60 days.  On November 1, 1993, Mr. Cutter signed a 
contract for the purchase of the Marsh Quay house, which was 
contingent on the sale of his old residence and his ability to secure 
financing.  He settled on the contract on December 13, 1993.

The agency denied Mr. Cutter TQSE for the period he was renting the 
house, finding that he had not demonstrated an intention to occupy it 
on other than a permanent basis.  In addition, the agency denied all 
expenses for Mr. Cutter's aunt and 22-year-old daughter because they 
did not qualify as eligible dependents for relocation expense 
purposes.  As a result, the agency determined that Mr. Cutter was 
indebted for $17,195, the amount by which his travel advance exceeded 
his allowable expenses.

The Defense Finance and Accounting Service, and subsequently our 
Claims Group, agreed with the agency and disallowed Mr. Cutter's 
claims.  Mr. Cutter now appeals the denial of TQSE and requests that 
we consider waiving those expenses, as well as the relocation expenses 
that were erroneously authorized for his aunt and daughter.

OPINION

Temporary Quarters Subsistence Expenses

A transferred employee may be allowed subsistence expenses when the 
occupancy of temporary quarters is determined to be necessary.  5 
U.S.C.  5724a(a)(3) (1994); Joint Travel Regulations (JTR), vol. 2, 
chapter 13.  The JTR further provides that:

     "[O]ccupancy of temporary quarters that eventually become the 
     employee's permanent residence shall not prevent payment of 
     temporary quarters allowance if the employee shows satisfactorily 
     that the quarters occupied were intended initially to be only 
     temporary.  In making this determination, the DOD [Department of 
     Defense] component concerned should consider factors such as:  
     the duration of the lease, movement of household goods into the 
     quarters, type of quarters, expressions of intent, attempts to 
     secure a permanent dwelling, and the length of time the employee 
     occupies the quarters."  2 JTR para. C13000.

By its terms, the JTR commits to the agency's judgment determinations 
of whether an employee has provided satisfactory evidence of an intent 
to occupy quarters on only a temporary basis.  The agency's 
determination that the evidence is insufficient to show such an intent 
will not be overturned by our Office unless it lacks any reasonable 
basis in the record and thus constitutes an abuse of discretion.  
Richard A. Alschuler, 71 Comp. Gen. 389 (1992); Roland R. Leaton, 
B-261168, July 18, 1995.

In this case, the agency appears to have made an appropriate 
determination based on the factors cited in the regulations.  While 
Mr. Cutter rented the house on a short-term, month-to-month basis, the 
record suggests that at the time he began renting the house in August 
1993 he was also contemplating its purchase.  As noted previously, Mr. 
Cutter states that he "accepted [the house] for rent or purchase, 
contingent upon the sale of property in Sacramento and securing 
financing, Aug. 93."  Further, the statement from Mr. Cutter's realtor 
indicates that he continued to show houses to the Cutters from August 
to December 1993 as a precaution, in the event they were unable to 
purchase the Marsh Quay house.

The fact that Mr. Cutter received 30-day notices to vacate the house 
does not, in our view, change the nature of his occupancy, 
particularly since there is no evidence that he moved out in response 
to the notices.  Furthermore, while Mr. Cutter continued to keep his 
household goods in storage, the absence of household goods does not in 
itself show an intention to reside in quarters temporarily.  See, 
e.g., Stephen A. Webb, B-211004, May 23, 1983 ("[I]t is occupancy of 
the quarters, not their unrestricted or comfortable use, which is 
controlling.").  Accordingly, we find no basis to disturb the agency's 
determination that Mr. Cutter was occupying permanent quarters from 
August 18 to December 13, 1993, and, therefore, he may not be allowed 
TQSE for that period.

As noted above, Mr. Cutter requests waiver of his indebtedness for the 
portion of his travel advance covering TQSE during the rental period.  
Under 5 U.S.C.  5584 (1994), the Comptroller General may waive an 
employee's indebtedness for travel or relocation expenses only if the 
debt arises from an "erroneous payment."  In this case, Mr. Cutter 
became indebted for TQSE because he failed to meet the legal and 
regulatory requirements for the payment of such expenses, and not 
because of any administrative error in the authorization of TQSE.  
Consequently, Mr. Cutter's indebtedness for TQSE did not arise from an 
erroneous payment and may not be considered for waiver.  Sandra J. 
Samuels, B-226015, Apr. 25, 1988.

Relocation Expenses for Relatives

As noted previously, Mr. Cutter was erroneously authorized relocation 
expenses for his aunt and 22-year-old daughter.  The applicable 
regulations allow such expenses only for an employee's immediate 
family members, which do not include aunts under any circumstances and 
include children over 21 years of age only if they "are physically or 
mentally incapable of self-support."  2 JTR app. D.

The fact that Mr. Cutter was erroneously authorized relocation 
expenses would not provide a basis for payment of a subsequent claim, 
since the government is not bound by the erroneous acts of its agents.  
Karla Heerman, B-260861, Aug. 8, 1995.  However, since the agency is 
attempting to recoup the amounts it advanced to Mr. Cutter for these 
expenses, we may consider whether collection of the debt may be 
waived.

Under 5 U.S.C.  5584, an employee's indebtedness for an erroneous 
payment of relocation expenses may be waived if collection "would be 
against equity and good conscience and not in the best interests of 
the United States" and there is no indication of "fraud, 
misrepresentation, fault, or lack of good faith" on the employee's 
part.  As a general rule, we presume that an employee who incurs 
expenses erroneously authorized by travel orders has done so in 
reliance on those orders and, providing the claim meets the other 
criteria noted above, we will waive the resulting debt.  Mary F. 
Lopez, B-236856, Dec. 15, 1989; Darlene Wyrick, 68 Comp. Gen. 462 
(1989).  In both of the cited cases, we waived debts resulting from 
travel orders erroneously authorizing relocation expenses for 
nondependent adult children.

In this case, we find that Mr. Cutter meets the requirements for 
waiver.  There is nothing in the record to indicate that Mr. Cutter 
misled the agency as to the identities of either relative; in fact, 
the orders themselves clearly state the daughter's birth date and the 
aunt's relationship to the employee.  Therefore, we may presume that 
Mr. Cutter incurred relocation expenses for his aunt and daughter in 
good faith reliance on his travel orders, and his resulting 
indebtedness may be waived.

While we conclude that waiver is appropriate in this case, the record 
does not permit a determination of the dollar amount that is subject 
to waiver.  Accordingly, we are remanding the case to the agency for 
calculation of the amount of relocation expenses that Mr. Cutter would 
have been entitled to receive for his aunt and daughter had they 
qualified as members of his immediate family.  If the amount is $1,500 
or less, the agency may waive its collection pursuant to 5 U.S.C.  
5584; if it is higher, the matter should be returned to us for waiver.

Accordingly, we affirm our Claims Group's determination that Mr. 
Cutter is not entitled to TQSE for the period August 18 to December 
13, 1993, and hold that his indebtedness for those expenses may not be 
waived.  Mr. Cutter's indebtedness for relocation expenses incurred on 
behalf of his aunt and daughter is remanded to the agency for 
calculation of the amount subject to waiver.

/s/Seymour Efros
for Robert P. Murphy
General Counsel