TITLE: B-309604, Customs and Border Protection--Availability of Appropriations for Credit Monitoring Services, October 10, 2007
BNUMBER: B-309604
DATE: October 10, 2007
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B-309604, Customs and Border Protection--Availability of Appropriations for Credit Monitoring Services, October 10, 2007

   Decision

   Matter of: Customs and Border Protection--Availability of Appropriations
   for Credit Monitoring Services

   File: B-309604

   Date:  October 10, 2007

   DIGEST

   Customs and Border Protection's (CBP) Salaries and Expenses appropriation
   is not available to pay for credit monitoring services for its employees
   in the New Orleans area who, as a result of Hurricane Katrina, are, or may
   become, victims of identity theft. The costs of the services are personal
   expenses. Without express statutory authority, appropriations are not
   available to pay personal expenses unless the expenditure primarily
   benefits the government and the benefit to the employee is incidental. CBP
   employees individually, not the government, would be the primary
   beneficiaries of the proposed credit monitoring. Neither government action
   nor inaction compromised the employees' identities. Government credit
   cards were not compromised or threatened. The credit monitoring services
   are part of the employees' overall management of their personal finances.

   DECISION

   U.S. Customs and Border Protection (CBP) has requested a decision under 31
   U.S.C. sect. 3529 on whether CBP's Salaries and Expenses (S&E)
   appropriation is available to pay for credit monitoring services for
   employees in the New Orleans area who are, or may become, victims of
   identity theft in the wake of the devastation caused by Hurricane Katrina.
   Letter from Anthony L. Smith, Certifying Officer, CBP, to the Comptroller
   General of the United States, GAO, May 7, 2007 (Smith Letter). Credit
   monitoring service costs are personal expenses and, without express
   statutory authority, are not chargeable to agency appropriations, unless
   the government is the primary beneficiary of the expenditure. For the
   reasons explained below, we conclude that CBP's individual employees, not
   the government, would be the primary beneficiaries of the proposed credit
   monitoring. Accordingly, CBP's S&E appropriation is not available to pay
   for credit monitoring services for its employees.

   Generally, our practice upon receiving a request for a decision is to
   obtain the views of the relevant federal agency to establish a factual
   record and to elicit the agency's legal position in the matter. GAO,
   Procedures and Practices for Legal Decisions and Opinions, GAO-06-1064SP
   (Washington, D.C.: Sept. 2006), available at www.gao.gov/legal.htm. In
   this case, the CBP certifying officer, in his request for a decision,
   provided the facts giving rise to the issue as well as a proposed
   justification for the use of appropriated funds for credit monitoring
   services.

   BACKGROUND

   Following Hurricane Katrina, more than two dozen CBP employees in the New
   Orleans area have become victims of identity theft. Smith Letter. CBP
   believes that because of the widespread scope of the problem, "it is
   certainly possible that additional employees have had their identities
   compromised and will experience [credit problems] in the near future." Id.

   CBP would like to assist its employees who are or may become victims of
   identity theft by purchasing a one-year subscription to a credit
   monitoring service for the benefit of the affected employees. Id. CBP
   acknowledges that employees will benefit personally, but asserts that the
   government will benefit as well. Id. CBP stated:

     "Employees who are victims of identity theft may be less focused on
     their jobs and the agency mission since much of their attention may be
     directed toward rectifying the damage associated with identity theft. In
     addition, affected employees may need to take significant time off of
     work in order to resolve outstanding issues related to identity theft."

   Id.  CBP argues that subscribing to a credit monitoring service for its
   victimized employees will increase their job performance, reduce their
   time away from work, minimize disruption to the work environment, and
   increase employee morale. Id.

   DISCUSSION

   CBP proposes to use its S&E appropriation for this purpose. For fiscal
   year 2007, CBP received an S&E appropriation of over $5.5 billion "[f]or
   necessary expenses for enforcement of laws relating to border security,
   immigration, customs, and agricultural inspections and regulatory
   activities related to plant and animal imports . . . " Department of
   Homeland Security Appropriations Act, 2007, Pub. L. No. 109-295, title II,
   120 Stat. 1355, 1358 (Oct. 4, 2006). An agency may use appropriated funds
   only for the objects for which the appropriation was made. 31 U.S.C.
   sect. 1301(a). Appropriated funds are generally not available for the
   personal expenses of government employees. B-302548, Aug. 20, 2004.

   We have allowed exceptions to the general rule when a particular
   expenditure for an item that is ordinarily considered to be personal in
   nature primarily benefits the government, notwithstanding the collateral
   benefit to the employee. B-302993, June 25, 2004. In cases such as this,
   the issue presented is the availability of the public's money to supply
   services that inure to the benefit of individuals. Id. We generally
   resolve this issue by assessing the benefits to the agency from any such
   expenditure. Id. The determining factor is whether, on balance, the agency
   or the individual receives the primary benefit. Id. If the primary
   beneficiary is the individual, not the agency or the government, the
   well-established rule is that such expenditure is not an authorized use of
   appropriated funds. 41 Comp. Gen. 387 (1961); B-259947, Nov. 28, 1995.

   For example, in a 2001 decision, we concluded that the United States
   Geological Survey (USGS) could not use its appropriations to purchase
   prescription eyeglasses for employees of its Optical Science Laboratory
   because the expense of prescription eyeglasses is a personal expense.
   B-283167, Feb. 21, 2001. In that case, the employees performed film
   inspection, searching for or evaluating objects in fine detail from a near
   viewing distance and searching for small and subtle defects or
   abnormalities in the film. We said that "[w]hile the USGS certainly
   benefits from employees' corrected vision, the primary beneficiary is the
   employee." In balancing the benefits to the government versus the benefits
   to the employees, we noted that on the one hand, the government could
   accomplish its work more expeditiously and satisfactorily because the
   eyeglasses would allow employees to better perform their assigned tasks.
   On the other hand, the prescription glasses would be useful only to the
   individual employees for whom they were prescribed and would be of value
   to the employees outside of their work for USGS. In our view, while the
   government certainly received a collateral benefit, the primary
   beneficiary was the employee.

   In this case, CBP employees, not the government, are the primary
   beneficiaries of the credit monitoring services. Subscribing to a credit
   monitoring service is a part of an individual's overall management of the
   individual's personal finances. The expense is in no way related to the
   purpose of CBP's S&E appropriation. CBP presented no evidence to establish
   that either government action or inaction compromised the employees'
   identities, nor is there any indication that government credit cards are
   compromised as a result of the identity theft. CBP argues that without the
   services, productivity would suffer because employees who are identity
   theft victims would be distracted when performing their duties and would
   be absent from work more than they ordinarily would be. The CBP employees'
   identity theft concerns are really no different from the concerns that
   individuals are presented with in the conduct of their personal affairs
   generally; the resulting distractions are no different from other
   distractions arising from employees' private lives. We see little, if any,
   benefit to the government. In the USGS case, there was a direct
   correlation between corrected vision and work performance; nevertheless,
   the personal benefits outweighed the benefits to the government. The
   benefits CBP has asserted in this case are even more attenuated than those
   found in the USGS case. In our view, the expenses that a government
   employee incurs in order to manage his or her finances, such as
   subscribing to a credit monitoring service to identify the criminal misuse
   of his or her credit, are personal expenses.

   We recognize that in this case, CBP's employees' identity theft concerns
   arose in the aftermath of an extraordinary natural disaster. Nonetheless,
   this fact does not transform what is clearly a personal benefit into a
   governmental benefit. Accordingly, because CBP employees individually, and
   not the government, would be the primary beneficiaries of the proposed
   expenditures for credit monitoring services, CBP's S&E appropriation is
   not available to pay for the service.

   CONCLUSION

   CBP's S&E appropriation is not available to pay for credit monitoring
   services for employees in the New Orleans area who, as a result of
   Hurricane Katrina, are, or may become, victims of identity theft. Credit
   monitoring service costs are personal expenses and are not chargeable to
   agency appropriations without express statutory authority. The exception
   to this rule is when the government is the primary beneficiary of the
   expenditure and the benefit to the employee is incidental. CBP's
   employees, not the government, would be the primary beneficiaries of the
   proposed credit monitoring. Neither government action nor inaction
   compromised the employees' identities. Government credit cards were not
   compromised or threatened. The credit monitoring services are part of the
   employees' overall management of their personal finances.

   Gary L Kepplinger
   General Counsel