BNUMBER:  B-260903
DATE:  May 29, 1996
TITLE:  Julie B. Fagan

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Matter of:Julie B. Fagan

File:     B-260903

Date:May 29, 1996

DIGEST

Under Federal Travel Regulation  sec.  302.5.2(c) (1995), employee who 
occupied, on a lease basis, a residence she intended to make her 
permanent residence upon completing its purchase is not entitled to 
temporary quarters expenses.  Employee's reliance on erroneous advice 
by an agency official that she would be reimbursed for her occupancy 
during the lease period and resultant cost savings to the government 
do not bind the government to pay subsistence expenses for an 
employee's occupancy of quarters intended to be her permanent 
residence.

DECISION

The Department of Housing and Urban Development (HUD) requests a 
decision on whether to reimburse Julie B. Fagan for disallowed 
temporary quarters expenses in connection with her transfer from 
Washington, DC, to Hartford, Connecticut.[1]  

BACKGROUND

Ms. Fagan was transferred from HUD Headquarters in Washington, DC, to 
Hartford, Connecticut, on October 19, 1994, with a reporting date of 
December 4, 1994.  On November 14, 1994, Ms. Fagan inquired whether it 
would be possible for her to be reimbursed temporary quarters expenses 
for her occupancy of a Hartford residence that she hoped to purchase, 
pending settlement on the residence.  She indicated that her lawyer 
had provided a lease that was separate from any agreement to purchase 
the residence and that the rental agreement would not be a condition 
of the purchase contract or mortgage settlement and would end at the 
closing date.  She was erroneously advised by the HUD Administrative 
Officer, who had conferred with the Travel Policy Office, that she 
could be reimbursed for her occupancy of the residence as temporary 
quarters under these conditions.

Ms. Fagan was reimbursed $770 for temporary quarters at a separate 
location in the Hartford area for the period from November 28 to 
December 2, 1994.  She and her family moved into the residence on 
December 2.  The remainder of her claim, for the period beginning on 
the date she moved into the residence, was disallowed based on her 
intent to make the residence permanent.  In her request for 
reconsideration, Ms. Fagan contends that she would not have moved into 
the residence had she been provided accurate information concerning 
temporary quarters.  She asserts that she should not be penalized for 
the erroneous information provided by HUD staff and that she would 
have occupied temporary quarters in a hotel had she been provided 
accurate information prior to her occupancy of the residence.  In 
addition, Ms. Fagan contends that occupying her residence was cost 
effective since it enabled her to avoid costs for storing household 
goods.  Moreover, the daily rental rate ($100) for the residence was 
lower than the government rate ($138) charged by the hotel.

ANALYSIS AND CONCLUSION

Under the provisions of 5 U.S.C.  sec.  5724a(a)(3) and the implementing 
regulations in Chapter 302, Part 5 of the Federal Travel Regulation 
(FTR),[2] an employee may be reimbursed for the expenses of the 
occupancy of temporary quarters in connection with an official 
transfer to a new duty station.  In order to be eligible for temporary 
quarters subsistence expenses, an employee must occupy temporary 
quarters.  Under  sec.  302-5.2(c) occupancy of temporary quarters that 
eventually become the employee's permanent residence shall not prevent 
payment of the temporary quarters allowance, if, in the agency's 
judgment, the employee shows satisfactorily that the quarters occupied 
were intended initially to be only temporary. 

In determining whether an employee intended to occupy the quarters on 
a temporary basis, the agency is to consider such factors as the type 
of quarters, the duration of any lease, movement of household effects 
into the quarters, efforts to secure a permanent residence at a 
separate location, expressions of intent, and any other pertinent 
facts and circumstances surrounding the occupancy.  41 C.F.R.  sec.  
302-5.2(c).

The threshold determination as to whether the quarters were initially 
temporary in nature is based on the intent of the employee at the time 
he moves into the dwelling.  Carl A. Zulick, 67 Comp. Gen. 585 (1988).  
In James W. Pierce, B-202103, July 16, 1981, we held that where an 
employee purchased a house which was ready for occupancy and moved in 
on a rental basis pending purchase settlement, he was not entitled to 
temporary quarters during the rental period because the record showed 
that it was the employee's intention at the time he moved into the 
house to make it his permanent residence.  See also, Kent N. Rosenlof, 
66 Comp. Gen. 701 (1987), and Stephen A. Webb, B-211004, May 23, 1983.    

In the present case, it is not disputed that Ms. Fagan moved her 
household goods and family into the residence with the intent to 
occupy it on a permanent basis.  The lease was a temporary financial 
arrangement pending settlement that was in process on the residence.  
Ms. Fagan was clear in her statements to agency officials she 
consulted that her intent was to make the residence her permanent 
place of abode.

Ms. Fagan's reliance on erroneous advice from an agency official does 
not provide a basis for allowing her claim.  Erroneous advice does not 
bind the government to pay an unauthorized claim.  See, John 
Pradarits, 56 Comp. Gen. 131 (1976).  Moreover, cost savings to the 
government do not serve to transform permanent occupancy of a 
residence into temporary occupancy.  Stephen A. Webb, supra.

Accordingly, under FTR  sec.  302-5.2(c) and our decisions, once Ms. Fagan 
occupied the residence which she intended to be her permanent 
quarters, even on a rental basis, her entitlement to temporary 
quarters expenses terminated.  Ms. Fagan's claim may not be paid.

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

1. This request was submitted by Mr. William H. Eargle, Jr., Director, 
Office of Finance and Accounting, U.S. Department of Housing and Urban 
Development, Washington, DC.

2. 41 C.F.R. Chapter 302-5 (1995).