BNUMBER:  B-272040 
DATE:  October 29, 1997
TITLE: National Aeronautics and Space Administration - Use of, B-
272040, October 29, 1997
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Matter of:National Aeronautics and Space Administration - Use of 
          Appropriations to Fund Expansion of "Career Transition 
          Assistance Program"

File:     B-272040

Date:October 29, 1997

DECISION

National Aeronautics and Space Administration (NASA) proposes to use 
its appropriations to fund an expanded "Career Transition Assistance 
Program," including increased assistance identifying job prospects for 
NASA employees and incentive payments to contractor for identifying 
jobs accepted by NASA employees.   As part of its agency personnel 
management, NASA has a wide range of discretion to decide not only the 
amount but the type of outplacement assistance provided its employees.  
We have no objection to an expanded CTAP program, including contractor 
bonuses or incentive fees for identifying jobs accepted by NASA 
employees, so long as NASA determines that the expenditures inure 
primarily to NASA's benefit and the additional cost is reasonable in 
light of the anticipated benefits.

DECISION

The General Counsel, National Aeronautics and Space Administration 
(NASA), has requested a decision on the propriety of using 
appropriations to fund an expansion of its "Career Transition 
Assistance Program" (CTAP).  The CTAP is operated by a contractor and 
offers outplacement services to NASA employees.  NASA is considering 
an expansion of the program to offer additional services in part to 
offset the costs of agency downsizing.  As explained below, we would 
not object to NASA using otherwise available funds for the expanded 
program provided NASA determines that the expenditures primarily inure 
to NASA's benefit and the additional cost is reasonable in light of 
the anticipated benefits to NASA.

Background

NASA established the CTAP to ease the transition for its employees 
from employment with NASA to employment elsewhere.  The CTAP currently 
offers to all employees various outplacement services such as group 
seminars, employment 
workshops, individual career counseling, access to employer data bases 
and electronic bulletin boards, and access to equipment for 
preparation of resumes and applications.

Under the expanded CTAP program NASA is considering, a contractor 
would conduct job searches for NASA employees based on individual 
employee job and location preference and would arrange interviews with 
prospective employers.  NASA is considering offering the contractor 
bonuses or incentive fees contingent upon the contractor identifying 
jobs accepted by NASA employees.

NASA states that there is no specific statutory authority to use its 
appropriations for this purpose, but it believes that the proposed 
expenditures are primarily for the government's benefit and can be 
justified as a necessary expense of the appropriations available for 
its personnel program.  NASA notes that government agencies have in 
recent years increasingly offered a wide variety of outplacement 
services to employees, and while agencies may not have offered the 
type of services the expanded CTAP would provide, private sector 
employers have offered such services during large downsizing 
activities.  

In addition, NASA states that the voluntary separation of employees 
who identify other jobs with the proposed outplacement assistance will 
be significantly less expensive than the involuntary separation of 
employees through a reduction in force (RIF) and the payment of 
severance pay.  Finally, NASA notes that involuntary separation of 
employees through a RIF would have negative emotional and financial 
impacts on large numbers of affected employees, while the proposed 
expanded CTAP could reduce the need for a RIF and consequently 
significantly mitigate these negative impacts on both those who leave 
NASA for new positions and those who remain with NASA.

In light of the above, while NASA recognizes that the employee who 
receives a new job under the proposed program benefits, it nonetheless 
believes that the primary benefit may reasonably be said to run to the 
government.  However, NASA seeks our decision because, although it is 
aware of decisions of our office authorizing use of appropriated funds 
for outplacement services, it has found none addressing a program as 
expansive as the one it proposes.

Analysis and Conclusion

We view outplacement assistance to employees as a legitimate matter of 
agency personnel administration for which appropriated funds may be 
used, as long as such assistance benefits the agency.  72 Comp. Gen. 
229 (1993); 68 Comp. Gen. 127 (1988).  Assistance typically covers the 
employee's costs in attending seminars, training, and counseling 
sessions.  However, the form or type of the assistance is not 
dispositive of whether appropriated funds may be used.  72 Comp. Gen. 
229 (1993).  Rather, the agency must determine whether the expense of 
the proposed outplacement assistance is necessary to accomplish the 
purpose of the appropriation to be charged.  In this regard, the 
agency should consider the benefits the agency expects from the 
proposed outplacement assistance and evaluate the anticipated benefits 
in light of the cost of the assistance to assure itself that the 
amount expended for the services is reasonable.  72 Comp. Gen. 230 
(1993);          68 Comp. Gen. 127, 129 (1988).

In analyzing the anticipated benefits of an outplacement program in 
relation to its cost, NASA may appropriately consider factors such as 
the need for and the size of a downsizing, the difficulty of locating 
other employment in a market where other agencies also are downsizing, 
and the monetary costs and negative effects on morale of a RIF that 
could be avoided by use of the proposed program.  
Since there is no question that the cost of outplacement services per 
se is a legitimate agency expense as long as the benefit primarily 
accrues to the agency, if 
NASA has analyzed the applicable factors and concludes that the cost 
of the program is reasonable in relation to the anticipated benefit to 
the agency, NASA may use available appropriations to fund the program.

Whether NASA chooses to structure the contractor's remuneration to 
include incentive payments or bonuses payable for each job located is 
primarily a matter for NASA to determine in deciding how to best 
formulate the contract to achieve the results desired.  We caution, 
however, that in structuring the contract, NASA should be sensitive to 
avoid payments to a contractor for locating a job that provides no 
benefit to the agency.  Thus, we would object to the use of 
appropriated funds to pay a contractor for placement services provided 
a former employee, for example, to one who had been involuntarily 
separated and paid severance pay.

Comptroller General
of the United States