TITLE: B-309715, National Transportation Safety Board--Insurance for Employees Traveling on Official Business, September 25, 2007
BNUMBER: B-309715
DATE: September 25, 2007
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B-309715, National Transportation Safety Board--Insurance for Employees Traveling on Official Business, September 25, 2007
Decision
Matter of: National Transportation Safety Board--Insurance for Employees
Traveling on Official Business
File: B-309715
Date: September 25, 2007
DIGEST
The National Transportation Safety Board (NTSB) improperly used its
appropriated funds to purchase accident insurance for its employees on
official travel. NTSB does not have an appropriation specifically
available for such a purpose, and the expenditures cannot be justified as
a necessary expense. Because NTSB has no appropriation available to
purchase accident insurance, the payments NTSB made constitute violations
of the Antideficiency Act. NTSB must report the violations to the
President and Congress, with a copy of the report to the Comptroller
General.
DECISION
The National Transportation Safety Board (NTSB) has requested a decision
under 31 U.S.C. sect. 3529 regarding whether NTSB properly used its
appropriated funds to purchase accidental death and dismemberment
insurance for its employees traveling on official business and, if not,
whether such payments constituted violations of the Antideficiency Act, 31
U.S.C. sect. 1341. Letter from Steven E. Goldberg, Chief Financial
Officer, NTSB, to David M. Walker, Comptroller General of the United
States, Re: Request for Advisory Opinion Under 31 U.S.C. sect. 3529
Concerning Payment of Insurance Coverage for NTSB Employees, June 19, 2007
(Goldberg Letter). We conclude that NTSB's appropriation was not available
to purchase such insurance and that NTSB's payments for the insurance
violated the Antideficiency Act.
Our practice when rendering decisions is to obtain the views of the
relevant federal agencies. 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 regard, NTSB provided us a
legal memorandum detailing its views in this matter. Memorandum from Linda
L. Lewis, Assistant General Counsel, NTSB, to Joseph G. Osterman, Managing
Director (MD-1), NTSB, Insurance Coverage for NTSB Employees, May 25, 2007
(Lewis Memo), submitted with Goldberg Letter.
BACKGROUND
NTSB employees fly in official travel status on various types of
commercial and government aircraft, both as ticketed and non-ticketed
passengers, to transportation accident sites around the world. Goldberg
Letter, at 1. In the aftermath of a 1996 crash of an Air Force airplane in
Croatia, NTSB employees raised concerns about the extent of their
insurance coverage when flying to accident scenes on official travel. Id.
The employees were concerned that travel insurance incidental to the
government travel card contract did not cover non-ticketed travel, that
there was no Federal Tort Claims Act[1] right of recovery for an accident
involving a United States government aircraft, and that there was likely
no way to recover losses resulting from accidents involving foreign state
aircraft. Id. at 2.
To allay these concerns, NTSB purchased an accidental death and
dismemberment insurance policy in 1998 for its employees who travel on
official business and renewed it regularly until 2006.[2] Id. at 1. NTSB
paid the policy from its "Salaries and Expenses" appropriation, which is
available for "necessary expenses of the National Transportation Safety
Board." E.g., Transportation, Treasury, Housing and Urban Development, the
Judiciary, the District of Columbia, and Independent Agencies
Appropriations Act, 2006, Pub. L. No. 109-115, div. A, title VI, 119 Stat.
2396, 2487 (Nov. 30, 2005). The policy provided insurance to all NTSB
employees traveling domestically or internationally on official business,
in any kind of vehicle, whether commercial or government owned. Goldberg
Letter, at 2.
In September 2006, NTSB extended the policy until September 2007; however,
on the advice of counsel, NTSB did not pay the invoice for that year and
canceled the policy retroactively to September 1, 2006. Id. NTSB counsel
advised that NTSB's appropriation was not available to purchase accident
insurance for NTSB employees. Lewis Memo, at 9--10. Counsel concluded that
accident insurance is a personal expense to be borne by the employee, not
the government, and that accident insurance has no particular nexus with
NTSB's mission. Id. At counsel's suggestion, NTSB asks us whether it
properly used its appropriation to purchase accident insurance for its
employees, and if not, whether it violated the Antideficiency Act.
DISCUSSION
Appropriated funds are available only for the objects for which they were
made unless otherwise provided by law. 31 U.S.C. sect. 1301(a). However,
each item of expenditure need not be specified in an appropriations act.
B-306748, July 6, 2006. Under the necessary expense rule, appropriations
are available for expenses which are necessary or incident to the proper
execution or achievement of the object of the appropriation. Id. The
necessary expense rule recognizes that when Congress makes an
appropriation for a particular purpose, by implication it authorizes the
agency involved to incur expenses which are necessary or incident to the
accomplishment of that purpose. Id.
As a general matter, accident insurance while in official travel status is
a personal expense to be borne by the employee. 47 Comp. Gen. 319 (1967);
B-128981, Sept. 20, 1956 (appropriated funds not available to purchase
"flight insurance" for employees traveling on official business). See also
B-208630, Mar. 22, 1983 (appropriated funds not available to purchase
personal collision insurance for employee who rents automobile); 41 C.F.R.
sect. 301-10.452 (when renting an automobile on official business accident
insurance "is a personal expense"). Of course, when an agency has
statutory authority to provide insurance to its employees, it may do so.
For example, agencies are required to pay from their appropriations an
amount equal to one half the amount an employee elects to withhold from
his or her pay as a contribution to a group life insurance plan purchased
by the Office of Personnel Management, such as the Federal Employees Group
Life Insurance (FEGLI) program. 5 U.S.C. sect. 8708. See B-143693, Aug.
25, 1960 ("Any extensions of such [agency] contributions . . . or increase
in the field of coverage would . . . be appropriate matters for
legislation."). NTSB has not identified, and we are not aware of, any
statutory authority permitting it to purchase accident insurance for its
employees.
We have not objected to the use of appropriated funds to cover what would
otherwise be personal expenses where the benefit accruing to the
government outweighs the personal nature of the expense. E.g., B-288266,
Jan. 27, 2003. That is not the case here, however. In this regard, NTSB is
"charged by Congress with investigating every civil aviation accident in
the United States and significant accidents in the other modes of
transportation." NTSB, History and Mission, available at
www.ntsb.gov/Abt_NTSB/history.htm (last visited Aug. 27, 2007). NTSB also
investigates "aviation accidents overseas involving U.S.-registered
aircraft, or involving aircraft or major components of U.S. manufacture."
Id. To fulfill this mission, NTSB employees "travel throughout the country
and to every corner of the world to investigate significant accidents."
Id. Prior to the purchase of the insurance policy in 1998, and since its
cancellation in 2006, NTSB employees have carried out this responsibility
without the benefit of accident insurance supplied by NTSB, belying any
notion that accident insurance is necessary to the success of NTSB's
mission. More importantly, as NTSB counsel recognizes, "there is already a
general requirement for Federal employees to perform their jobs in
accordance with their agency's statutory mandates and governing
regulations. No further inducement is necessary or justified. . . .
[Purchasing accident insurance for NTSB employees in official travel
status] does not bear a logical relationship to NTSB's general
appropriation." Lewis Memo, at 9--10. We agree. Accident insurance is not
necessary for the successful execution of the object of NTSB's
appropriation, and thus NTSB improperly used its appropriated funds to
purchase accident insurance for its employees.
In one case, we concluded that the General Services Administration could
accept accident insurance coverage for federal employees when the
insurance was merely incidental to a statutorily authorized travel agent
contract or a contract for travel cards. B-222234, Dec. 9, 1986. In that
case, the incidental benefit did not cost the government extra money, the
government could not negotiate the insurance term out of the contract, and
the government received no financial incentive if it declined the
insurance. Id. As NTSB counsel points out, NTSB has purchased its
accident insurance policy for the sole purpose of providing coverage to
its employees, not as an incidental part of a broader contract. Lewis
Memo, at 11.
When an agency's appropriation is not available for a certain purpose, and
the agency has no other funds available for that purpose, any payments the
agency makes or obligations it incurs for that purpose violate the
Antideficiency Act, 31 U.S.C. sect. 1341(a).[3] B-302710, May 19, 2004;
B-229732, Dec. 22, 1988. As discussed above, NTSB has no funds available
to purchase accident insurance for its employees in official travel
status. Thus, payments NTSB made for the insurance constitute violations
of the Antideficiency Act. B-302710. NTSB counsel agrees. Lewis Memo, at
14 ("In the absence of an appropriation, executive officers and employees
may not draw funds from the Treasury to effectuate an otherwise
unauthorized purpose. If an agency does so, it has violated the
Antideficiency Act."). NTSB must report such violations to Congress and
the President, with a copy of the report to the Comptroller General. 31
U.S.C. sect. 1351.
CONCLUSION
NTSB improperly used its appropriated funds to purchase accident insurance
for its employees on official travel. NTSB does not have an appropriation
specifically available for such a purpose, and the purchase cannot be
justified as a necessary expense. Because NTSB has no appropriation
available to purchase accident insurance, the payments NTSB made
constitute violations of the Antideficiency Act. NTSB must report the
violation to the President and Congress, with a copy to the Comptroller
General.
Gary L. Kepplinger
General Counsel
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[1] The Federal Tort Claims Act allows waiver of the federal government's
sovereign immunity in cases where federal employees are negligent while
acting within the scope of their employment. 28 U.S.C. sect. 1346(b).
[2] NTSB renewed the policy on a yearly basis until July 2002, when it
renewed the policy for 3 years. E-mail from Linda L. Lewis, Assistant
General Counsel, NTSB, to Wesley Dunn, Senior Staff Attorney, GAO,
Subject: NTSB Insurance Opinion, Aug. 24, 2007; Letter from Laura A.
Cincotta, Assistant Vice President, Marsh USA Inc., to Donald P. Libera,
Jr., Deputy Chief Financial Officer, NTSB, Subject: Group Business Travel
Accident Insurance Life Insurance Company of North America Policy #ABL
665772, Sept. 9, 2002. NTSB renewed the policy for another year in 2005.
See Letter from Laura A. Cincotta, Senior Associate, Mercer Health and
Benefits, to Ms. Colette M. Magwood, Assistant Human Resource Director,
NTSB, Subject: Group Business Travel Accident Insurance Life Insurance
Company of North America Policy #ABL 665772, June 30, 2006. NTSB spent a
total of $74,063 on the policy. E-mail from Stephen Goldberg, Chief
Financial Officer, NTSB, to Linda Lewis, Assistant General Counsel, NTSB,
Subject: FW: Flight Insurance Premiums, Aug. 27, 2007.
[3] Section 1341(a) provides in part, "An officer or employee of the
United States government . . . may not make or authorize an expenditure or
obligation exceeding an amount available in an appropriation."