February 8, 2012

In the Matter of the Petition by
MARGARET L. SMITH

P.S. Docket No.  AO 11-151

APPEARANCE FOR PETITIONER:
Margaret L. Smith

APPEARANCE FOR RESPONDENT:
Tom Cloonan

INITIAL DECISION

 As a result of Petitioner Margaret L. Smith’s relocation to a new duty station, Respondent, United States Postal Service, paid her a temporary quarters allowance.  Upon learning, two-and-one-half years later, that Petitioner had moved with her household furnishings into a house she owned at the new duty station, Respondent demanded that she repay the temporary quarters allowance.  By then Petitioner had retired, and she filed a Petition for Review under 39 C.F.R. Part 966, Rules of Practice in Proceedings Relative to Administrative Offsets Initiated Against Former Employees of the Postal Service.
A hearing was held in San Diego, and the parties submitted documents and written argument.  The following findings of fact are made based on the documents submitted and the testimony at the hearing.

FINDINGS OF FACT

 1.  In 2008, Petitioner was employed as an Operations Support Specialist in Respondent’s Western Area Office in Denver (Petitioner’s Exhibit (“Pet. Exh.”) 1, p. 8).
2.  She accepted a similar job in the Pacific Area Office in San Diego, a lateral transfer that included payment to Petitioner of relocation benefits pursuant to Respondent’s F-15 Handbook (Pet. Exh. 4, pp. 1-4; Hearing Transcript, page (“Tr.”) 171).
 3.  The F-15 Handbook in effect at the time of Petitioner’s move was the December 22, 2000 edition, revised as of March 25, 2002, and July 1, 2005 (hereinafter referred to as the “F-15 Handbook”) (Tr. 25-26).
 4.  On February 1, 2008, a Postal Service relocation coordinator sent Petitioner a brochure describing available relocation benefits.  She advised Petitioner where the F-15 Handbook could be accessed on the internet, but noted, “HQ is in the process of revising the F-15 for relocation.”  The relocation brochure identified the information it provided as general information and pointed out that “Handbook F 15 provides detailed information.”  (F 15 Handbook; Postal Bulletin 22159 (July 21, 2005); Pet. Exh. 4, pp. 1-12).
5.  The relocation benefits to be afforded Petitioner were listed on PS Form 178, Specific Travel Order – Relocation and Relocation Agreement, and included a temporary quarters allowance for her move from Denver to San Diego.  The Form 178 identified March 31, 2008, as Petitioner’s date to report to her new duty station.  (Respondent’s Exhibit (“Resp. Exh.”) 13 (PS Form 178 (Interim), December 2000); Tr. 195).
6.  The temporary quarters allowance authorized by the F-15 Handbook provided a lump sum amount to compensate a relocating employee for subsistence expenses while living in temporary quarters.  These expenses consist of commercial lodging, meals, laundry, and dry-cleaning.  The policy granting the benefit recognizes that while living in temporary quarters, the employee will not have available cooking and laundry facilities and thus will incur extra costs for lodging, restaurant meals, and laundry.  (F-15 Handbook, p. 25; Tr. 33, 88-89).
7.  The F-15 Handbook defined temporary quarters as follows:
Definition

Temporary quarters refer to any lodging obtained from commercial sources that you and your immediate family occupy for a temporary amount of time.  This is a temporary solution for housing until you can move into a permanent residence.  Quarters are not considered temporary if your lease is for more than 60 days.

*     *     *

BE AWARE that if you move your household goods into your temporary quarters, your housing is no longer considered temporary, and your expenses will not be reimbursed.

The admonition regarding household goods was repeated a few pages later:
IMPORTANT: If, at any time, you move your household goods into the temporary quarters, the reimbursable expenses discussed previously are terminated.

(F-15 Handbook, pp. 25, 29) (emphasis in original).

8.  In 2005, Respondent revised the F-15 Handbook, adopting an approach to temporary quarters awards under which Respondent calculated a lump sum figure that would be paid to the employee in advance of relocation.  For an employee who owned her own home at the old duty station, the lump sum temporary quarters allowance was calculated based on 60 days of the standard rate for lodging and per diem authorized federal travelers by the General Services Administration (“GSA”) for the new duty location.  (Postal Bulletin 22159 (July 21, 2005), p. 39; Tr. 27-29, 131).
9.  On February 4, 2008, Petitioner signed the PS Form 178 authorizing her relocation benefits (Finding 5).  The form included a Relocation Agreement in which she agreed:
1. In consideration of my receiving the benefits provided by Handbook F-15, Travel and Relocation, as applicable, I hereby agree to report to my newly assigned duty station and to remain in the USPS and at my newly assigned duty station for a period of twelve (12) months following the effective date of my transfer.  I understand the effective date of my transfer to be the date I reported for duty at my new official station.

2. I understand and agree that if I violate this agreement, all money paid to me and to third parties by the USPS as benefits in connection with my transfer shall be recoverable from me as a debt due to the USPS.

*     *     *

4. I have read the appropriate sections of Handbook F-15, as applicable, relating to relocation benefits.

(Resp. Exh. 13).

 10.  The F-15 Handbook cautioned an employee receiving relocation benefits, “If you decline to accept or complete your relocation, or you do not complete the 12-month commitment, you must pay back all relocation expenses that the Postal Service incurred for your relocation benefits . . ..”  (F-15 Handbook, p. 9).
 11.  Relocating employees were required by the F-15 Handbook to “[a]void unnecessary expenses.”  (F-15 Handbook, p. 5).
 12.  Petitioner received a $15,210 lump sum payment consisting of $2,272 for a house hunting trip and $12,938 for the temporary quarters allowance.  The temporary quarters allowance was calculated by multiplying the sum of the standard GSA lodging and meal rates for travelers in San Diego ($146 per day and $64 per day, respectively) by 60 days (60 x $210 = $12,600) and adding the cost of one round trip airfare between Denver and San Diego ($338).  (Resp. Exhs. 3, 24; Tr. 135-136).
 13.  Respondent contracts with a relocation company, Cartus, to coordinate employee relocations.  On February 14, 2008, a Cartus representative advised Petitioner of the relocation benefits available to her, including the compensation for house hunting trips and temporary quarters.  She wrote regarding the lump sum temporary quarters allowance, “There are no receipts required and the money is to be used at your discretion.”  She also advised that Petitioner had two years from her report-to-work date to complete her relocation.  (Pet. Exh. 3, p. 11; Resp. Exh. 10).
 14.  Cartus representatives coordinate employee relocations and administer available relocation benefits but have no authority to approve, change, or allow relocation benefits not authorized by Respondent (Tr. 52-54, 108-109).
15.  Petitioner has owned a house in San Diego since 1998.  At least part of the house had been rented to a tenant up to 2007; thereafter it was occupied periodically by her son, who paid no rent.  Petitioner paid the mortgage and all other costs of the house while she was in Denver.  (Resp. Exhs. 1 (pp. 5, 8), 3, 5; Tr. 179, 181, 217-218).
16.  In processing Petitioner’s move, neither Respondent’s employees nor the Cartus representative told Petitioner that moving into her own house in San Diego would disqualify her from receiving a temporary quarters allowance.  The Cartus representative did not ask Petitioner if she owned a house in San Diego.  The F-15 Handbook did not specifically point out that moving into a house owned by the employee at the new duty station would bar receipt of a temporary quarters allowance nor did the relocation brochure Petitioner was provided (Finding 4).  (F-15 Handbook; Tr. 51-52, 83, 102, 187-190).   None of the relocation forms given Petitioner to complete required that she notify Respondent that she owned a home at the new duty station (Tr. 58, 79).
 17.  Cartus coordinated the move of Petitioner’s household furnishings from Denver to San Diego.  At Petitioner’s direction, her household goods were delivered to her San Diego house on March 28, 2008, the same day she moved in.  (Resp. Exhs. 1 (pp. 27-34), 3, 17; Tr. 37).
 18.  Petitioner lived in the house for about a month.  She then moved into a townhouse in San Diego that she had previously rented for her son (Tr. 180, 189, 216-217).  She moved back to her house in October 2008.  From December 2008 until July 2010, she rented part of the house to a tenant (Tr. 180), but thereafter, Petitioner was the sole occupant.  (Resp. Exh. 1 (pp. 11-12), 3, 7; Tr. 179).
 19.  Petitioner reported to her new job at the Pacific Area Office in San Diego on March 31, 2008 (Pet. Exh. 3, p. 9; Resp. Exhs. 3, 7).
 20.  The Postal Service bought Petitioner’s Denver home no later than May 6, 2008.  Up until that time Petitioner paid all expenses of owning her Denver house.  (Resp. Exh. 14; Tr. 50-52, 64).
 21.  During the period from her 2008 relocation to San Diego through 2010, Petitioner tried to buy at least two houses in San Diego and three houses near where her son then lived, about a 60-mile commute from her office.  (Pet. Exhs. 1 (p. 16), 3 (pp. 17-18, 44-46); Resp. Exhs. 5, 6; Tr. 221).
 22.  Near the end of the two-year relocation period, Petitioner requested a one-year extension to use a relocation benefit that would cover closing costs of her acquisition of a permanent residence at her new duty station.  On April 13, 2010, the Headquarters relocation office granted a six-month extension, to September 30, 2010.  (Resp. Exh. 6; Pet. Exhs. 1 (pp. 16-20), 3 (pp. 17-23); Tr. 72-73).
 23.  When considering Petitioner’s extension request, a postal financial systems analyst in San Diego asked Petitioner whether she owned a home in San Diego.  Petitioner told her she did but that it was a rental.  (Tr. 151-152).  Had she known Petitioner had lived in her own house since her relocation in 2008, the analyst would not have recommended approval of the extension request (Tr. 152-154).  Respondent’s Headquarters relocation official granting the extension did not know Petitioner had moved back into a house she owned when relocating in 2008.  If she had known, she would not have granted the extension.  (Tr. 74, 93-94).
24.  On July 7, 2010, Petitioner asked her Cartus representative whether she would still receive the new home purchase benefits if she retired before closing the purchase of a new home but still closed before September 30, 2010.  The representative advised her that once she retired, no further relocation benefits would be paid.  (Pet. Exh. 4, p. 13).
25.  On August 30, 2010, Petitioner bought a house in San Clemente, California, near her son’s home and the location where she wished to live after she retired from the Postal Service (Pet. Exh. 3, p. 23).
26.  On September 2, 2010, Petitioner filed a claim with Respondent for recovery of her closing costs of $9,629.15 for the San Clemente house (Pet. Exh. 1, pp. 28-33; Resp. Exh. 1, p. 7).
27.  Petitioner retired from the Postal Service effective September 30, 2010 (Resp. Exhs. 4, 20).  She lived in her San Diego house until she moved to San Clemente (Tr. 219).
28.  On October 1, 2010, Petitioner’s former manager denied Petitioner’s claim for closing costs, stating that they were not recoverable because they were for a second home.  He added that the $12,938 temporary quarters portion of the lump sum paid Petitioner must be repaid:  “As you relocated to your new duty station to a home you owned, which was and continued to be your principal residence, you were not eligible for the temporary quarters allowance.”  He followed that letter with a Letter of Debt Determination on October 4, repeating the demand that Petitioner repay $12,938 and offering Petitioner an opportunity to request reconsideration.  (Pet. Exhs. 1 (p. 37), 3 (pp. 28-29); Resp. Exh. 12; Tr. 162-163).
29.  On October 7, 2010, Petitioner requested reconsideration, arguing that she never intended for her San Diego house to be her permanent or principal residence, and that the San Clemente house is her permanent residence (Pet. Exh. 1 (p. 41), 3 (p. 32)).
30.  On March 4, 2011, Petitioner wrote to her former manager complaining that she was entitled to a pay-for-performance bonus earned before her retirement (Pet. Exhs. 1 (p. 43), 3 (p. 34); Tr. 167, 184).  An award was made, but Respondent withheld the full amount to apply to repayment of the temporary quarters allowance Petitioner received in 2008 (Pet. Exhs. 1 (p. 44), 3 (p. 35); Resp. Exhs. 21, 22; Tr. 137).
31.  On April 20, 2011, Petitioner’s former manager denied reconsideration of the debt.  He concluded that Petitioner was not entitled to a temporary quarters allowance under Postal Service regulations because she moved into a house she owned at her new duty station.  He noted that her $4,323 pay-for-performance award would be credited toward the debt, and he demanded that she pay the remaining $8,615 balance within 14 days.  He advised that if she failed to do so, “we will take the necessary steps to collect this amount involuntarily.”  He concluded the letter by advising Petitioner of her right to file a petition under 39 C.F.R. Part 966.  (Resp. Exh. 11; Pet. Exhs. 1 (p. 52), 3 (p. 43)).
32.  Respondent withheld the net amount of Petitioner’s pay-for-performance award, $3,179.57, and applied it to the claimed debt (Resp. Exh. 22).
33.  Respondent requested the Office of Personnel Management (“OPM”) to collect from Petitioner’s annuity to satisfy her debt to Respondent (Resp. Exh. 20).
34.  The amount of $1,969.19 was withheld from Petitioner’s May 1, 2011 annuity payment (Pet. Exh. 2, pp. 28-29; Resp. Exhs. 21, 22; Annuity Statements submitted with Petitioner’s Brief (“Annuity Statements”)).
35.  Petitioner’s timely Petition for Review Under 39 C.F.R. Part 966 was docketed May 9, 2011.  The Notice of Docketing required Respondent to stay collection action in accordance with the applicable rules of practice (39 C.F.R. §966.5).
36.  The amount of $1,969.19 was withheld from Petitioner’s June 1, 2011 annuity payment (Resp. Exhs. 21, 22; Annuity Statements).
37.  By Order dated June 3, 2011, I directed Respondent to refund any withholdings made after Petitioner filed her Petition.
38.  On June 17, 2011, Respondent reimbursed Petitioner $1,969.19 (Resp. Exh. 21; Declaration of M. Petrachek, Exhibits A – D).
39.  The amount of $1,969.19 was withheld from Petitioner’s July 1, 2011 annuity payment (Annuity Statements).
40.  Petitioner’s September 1, 2011 annuity payment included a reimbursement from OPM of $1,969.19 (Annuity Statements).
41.  The total amount claimed by Respondent is $12,938.  It has collected a total of $5,148.76 ($3,179.57, the net of Petitioner’s pay-for-performance award (Finding 32), plus $1,969.19 collected from Petitioner’s May 1, 2011 annuity payment (Finding 34)).   In this proceeding Petitioner challenges Respondent’s retention of the amounts withheld and its intention to collect the remainder, $7,789.24, from her future annuity payments.

DECISION

Scope of Decision

Petitioner challenged Respondent’s refusal to pay her closing costs for the August 2010 purchase of her home in San Clemente (Findings 25, 26, 28) as well as Respondent’s intended involuntary collection of the $12,938 temporary quarters allowance.  Respondent’s Answer addressed both issues.  In a July 13, 2011 telephone conference (confirmed by a July 14, 2011 Order and Memorandum of Telephone Conference), I advised the parties that 39 C.F.R. Part 966 authorized consideration only of the second issue.  I have no authority to consider Respondent’s refusal to pay Petitioner’s closing costs.  Accordingly, this Initial Decision will decide only Petitioner’s challenge to Respondent’s recovery of the temporary quarters allowance.
Positions of the Parties
Respondent argues that it is entitled to recover the lump sum temporary quarters allowance Petitioner received because its relocation regulations do not authorize a temporary quarters allowance under the circumstances of Petitioner’s relocation.  It argues that as the payment was made to Petitioner erroneously, Respondent is entitled to recover it.
Petitioner argues she should not be denied the temporary quarters allowance because (1) the F-15 Handbook does not explicitly state that she was not entitled to the benefit and Respondent’s officials’ understood she was entitled to receive it; (2) Respondent’s representatives waived recovery by leading her to believe she was entitled to the benefit by granting it in the first place and by subsequently extending the time for her to claim the home purchase benefit; (3) Respondent unfairly delayed collection for two-and-one-half years; (4) Respondent failed to advise her of her appeal rights; (5) the F-15 Handbook does not authorize requiring her to pay back the allowance under circumstances present here; and (6) it was always her intention that her San Diego house would only be her temporary residence.

The F-15 Handbook

The F-15 Handbook defines temporary quarters as lodging obtained “from commercial sources.”  (Finding 7).  Upon returning to San Diego, Petitioner moved into the house she owned there (Finding 17), not to lodging obtained from commercial sources.  Additionally, because she received her household goods at the same time she moved into the San Diego house (Finding 17), a few days before reporting to her new job (Finding 19), she did not suffer the inconveniences of temporary lodging that the temporary quarters allowance is intended to alleviate, i.e., lack of permanent lodging with laundry facilities and a kitchen to prepare meals (Finding 6).  Moreover, under explicit limitations given emphasis in the F-15 Handbook, moving her household goods into her San Diego house disqualified Petitioner from receiving a temporary quarters allowance (Finding 7).   Additionally, as she had her household goods, her relocation experience does not justify recovery of a benefit designed to defray subsistence expenses stemming from temporary quarters occupancy (Finding 6).   Consequently, she was not entitled to a temporary quarters allowance under the F-15 Handbook.
Petitioner argues that she was not aware of the consequence of moving her household furnishings into her San Diego house.  She blames this on Respondent because (1) neither postal employees nor the Cartus representative involved with her relocation told her (Finding 16); (2) none of the forms she was required to complete asked whether she was moving into a house she owned (Finding 16); (3) the relocation brochure she was provided did not alert her to that limitation (Finding 16); and (4) she was notified that the F-15 Handbook was under revision (Finding 4) and assumed it no longer applied.
Whether the F-15 Handbook was being revised has no bearing on its applicability at the time of her relocation.  Further, the postal employee who advised Petitioner that the F-15 Handbook was under revision also told her where to find the F-15 Handbook on the internet, and the relocation brochure she was given specifically directed Petitioner to the F-15 Handbook for detailed information concerning relocation benefits and limitations (Finding 4).  During the relocation process, Petitioner repeatedly was directed to the F-15 handbook for guidance, and on the Form 178 authorizing her relocation, Petitioner certified that she had read the appropriate sections of the F 15 Handbook (Finding 9).  The F 15 Handbook was a regulation of the Postal Service (39 C.F.R. §211.2 (a)(3)) and defined the scope of relocation benefits afforded its employees.  That no one specifically and personally warned Petitioner of the consequence of moving with her household furnishings into a house she owned does not relieve her of limitations imposed by Respondent’s regulation.  See United States v. Bar Bea Trucking Co., 713 F.2d 1563, 1567 (Fed. Cir. 1983).
Petitioner argues that the actions of Respondent’s officials in allowing her to keep the money for two-and-one-half years before attempting recovery, authorizing the temporary quarters benefit in the first place, and granting Petitioner an extension to the two-year period to use the home purchase benefit waived the limitations of the F-15 Handbook.  Respondent has demonstrated that Petitioner was not entitled to a temporary quarters allowance.  Thus, granting the benefit in the first place was erroneous, and Petitioner is not entitled to keep a benefit granted her in error.  See Jill Jacquin, P.S. Docket No. DCA 96 371 (January 24, 1997).  While a prompt recovery of the unauthorized benefit would have been preferable, there is no statute of limitations that would preclude Respondent from recovery at this time, Kathryn L. Schrack, P.S. Docket Nos. DCA 11-52, DCA 11-53, and DCA 11-54 (August 26, 2011), and Petitioner has not demonstrated prejudice stemming from the collection delay.
Moreover, Petitioner led the postal officials granting the extension to believe that her San Diego house was a rental.  Had they known that Petitioner had moved into her own home and moved her furnishings in, Petitioner would not have been granted the extension.  (Findings 22, 23).  Under these circumstances extending the time for use of the home purchase benefit does not demonstrate that Respondent’s officials agreed that Petitioner’s receipt of the temporary quarters allowance was appropriate.
Avoidance of Unnecessary Expenses
Petitioner argues that she saved Respondent money by moving her household furnishings into her San Diego house because she would have been entitled to store them at Respondent’s expense.  She suggests that she was thus in compliance with the requirement in the F-15 Handbook that she avoid unnecessary expenses (Finding 11).  The purpose of the temporary quarters allowance is to defray lodging, meal, and incidental expenses associated with being in temporary housing.  That under different facts Respondent’s cost of Petitioner’s relocation might have been less is irrelevant.
Respondent’s Right to Recover the Temporary Quarters Allowance
Petitioner argues that the F-15 Handbook and her Relocation Agreement allow Respondent to recover the benefit in only two situations:  (1) if she failed to relocate or (2) if she failed to stay in the new position for 12 months (Findings 9, 10).  Since she met both of those requirements, she contends there is no basis for requiring her to repay the temporary quarters allowance she received.
Specific reference to two situations in which the employee may be required to repay relocation benefits does not preclude Respondent’s recovery where, as here, Petitioner was not entitled to the temporary quarters allowance under Postal Service regulations.  As the benefit was paid to her erroneously, she acquired no right to keep the funds.  See DiSilvestro v. United States, 405 F.2d 150, 155 (2d Cir. 1968).  Accordingly, Petitioner is indebted to Respondent in the amount of the erroneously paid relocation benefit.  See Raymond J. Voisine, P.S. Docket No. DCA 95-22 (March 21, 1995).

Respondent’s Withholding of Funds Owed Petitioner

Petitioner complains that Respondent failed to advise her of her right to petition for a hearing under 39 C.F.R. Part 966, Rules of Practice in Proceedings Relative to Administrative Offsets Initiated against Former Employees of the Postal Service, before withholding her pay-for-performance bonus and deducting from her May 1, 2011 annuity payment (Findings 31-40).  Respondent’s administrative offset regulations contemplate that an action to collect for a debt attributed to a former employee will be initiated by a demand from the Eagan Accounting Service Center offering an opportunity for the former employee to obtain reconsideration by her former installation head.  39 C.F.R. §966.4.  In this case, the claim for reimbursement of the temporary quarters allowance was initiated by Petitioner’s former manager, but it did offer her an opportunity for reconsideration (Finding 28).  Petitioner requested and received reconsideration of the alleged debt; her former manager denied her claim of entitlement to the temporary quarters allowance and advised her of her right to file a petition to challenge the involuntary collection under the applicable rules of Part 966 (Finding 29, 31).  Petitioner timely filed a petition for a hearing (Finding 35).  Respondent initiated withholding from Petitioner’s annuity in violation of 39 C.F.R. §966.5, which provides that a timely filed petition stays further collection action, but such withholdings have been refunded to Petitioner (Findings 34, 38, 39, 40).
In this proceeding, Petitioner submitted documents in support of her position, and an oral hearing was held in which she and other witnesses she requested testified.  She had an opportunity to confront and cross examine Respondent’s witnesses.  She was provided copies of the documents Respondent relied on as a basis for the claimed debt.  After being provided a copy of the transcript, both parties submitted written argument and supplementary evidence.  This process provided a fair and reasonable opportunity for Petitioner to challenge the debt claimed by Respondent.
The withholdings improperly made after this matter was docketed (but now refunded) did not prejudice her ability to challenge the debt at issue and do not provide a basis for relieving her of all or part of the debt.
Other Federal Relocation Decisions
The Civilian Board of Contract Appeals (“CBCA”) considers relocation issues for federal employees other than Postal Service employees, applying the Federal Travel Regulation (“FTR”).  In determining whether a relocating employee occupies temporary quarters, entitling her to a temporary quarters allowance, the FTR provides:
In determining whether quarters are temporary, the agency should consider factors such as the duration of the lease, movement of household effects into the quarters, the type of quarters, the employee’s expressions of intent, attempts to secure a permanent dwelling, and the length of time the employee occupies the quarters.

41 CFR 302-5.305.

Petitioner argues that she should be entitled to the temporary quarters allowance because she always intended that her San Diego house would be a temporary residence, citing a number of CBCA decisions.  She points out that throughout the two-and-one-half years of her occupancy she continued to look for other houses to buy (Finding 21) as evidence that she considered the San Diego house only a temporary residence.
Respondent argues correctly that the FTR does not apply to the Postal Service, 39 U.S.C. §410, and that the F-15 Handbook governs Petitioner’s relocation.  Accordingly, other agency decisions addressing relocation under the FTR are not binding in this proceeding, although their reasoning may have some helpful application in resolving Postal Service relocation issues.  Nevertheless, I am not persuaded that applying the FTR standards would result in a different outcome in this case.
In Juan G. Bernal, CBCA 1648-RELO, December 3, 2009, an employee was found not entitled to a temporary quarters allowance because he had entered a lease for one year with no provision for breaking it early, had received all of his household furnishings when he moved in, and at the time the claim was under consideration he had been in the leased house for 9 months.  Here Petitioner moved into a house she owned, received all her household furnishings when she moved in, and stayed in the house for two-and-one-half years.  Petitioner’s simple expressions of intent to occupy the San Diego house temporarily in the face of actions to the contrary will not suffice to prove the lodging temporary.  Id.
In a decision by the General Services Administration Board of Contract Appeals, which decided relocation claim cases before the 2007 creation of the CBCA, the judge addressed a claim for the meals and incidentals portion of a temporary quarters allowance of a relocating employee who moved into a furnished home he owned at the new duty station.  The judge noted that the temporary quarters allowance serves to reimburse an employee reasonably and equitably for subsistence expenses incurred when it is necessary for the employee to occupy temporary lodging and denied the claim:  “Because [the employee] occupied his own residence at the new duty station immediately upon reporting for duty, and had furnishings available for his use, he was never eligible to receive [a temporary quarters allowance].”  Donald D. Fithian, Jr., GSBCA No. 16712-RELO, 06-1 BCA ¶ 33,204.
Petitioner’s claim of entitlement to a temporary quarters allowance would likely fare no better under the FTR standard.

Conclusion

The Petition is denied.  Respondent is entitled to recover the amount of the temporary quarters allowance, $12,938.  It may retain the funds previously collected ($5,148.76 (Finding 41)) and recover the uncollected amount, $7,789.24, by offset against moneys owed Petitioner, including her retirement annuity.

Norman D. Menegat
Administrative Judge

[1] A subsequent revision of Respondent’s relocation regulation provided, “If you own or lease a home in the new duty station that will become your principal residence, relocation benefits will be limited.”  (F-15-A Handbook, Relocation Policy – Nonbargaining Executive and Administrative Schedule (EAS) Employees, August 2010, Section 247; see Pet. Exh. 6).

[2] In an August 27, 2009 email regarding her search for a house, Petitioner wrote to a friend, “I have no problem rehabbing if the payback is worth it.  Depending on the property, I would live in it (rent out my place), rent it or resell . . ..”  (Resp. Exh. 19 (p. 3); Tr. 212).

[3] The annuity withholdings made on June 1 and July 1, 2011, have been reimbursed to Petitioner (Findings 36, 38, 39, 40).

[4] Petitioner argued that the inclusion in a later edition of Respondent’s relocation regulation of a statement that moving into an owned home at the new duty station would limit relocation benefits (Finding 16, fn. 1) demonstrates that the F-15 applicable to her move did not include such a limit.  However, the language of the applicable F-15 Handbook addresses Petitioner’s exact circumstance and bars her recovery of a temporary quarters allowance because she at all times had her household furnishings available to her.  (Finding 6). That a later statement of the relocation policy might have focused more directly on ownership of the home does not change the limitations of the applicable F-15 Handbook.

[5] Petitioner argues that she was entitled to a temporary quarters allowance at least until May 6, 2008, when Respondent bought her Denver home (Finding 20), because she was bearing the expenses of two households.  However, incurring overlapping costs of home ownership does not entitle her to a temporary quarters allowance.  Moreover, she was incurring the same double housing costs before she moved.

[6]  Petitioner argues that the Cartus representative’s statement that the lump sum was to be used at Petitioner’s discretion (Finding 13) authorized her receipt and use of the temporary quarters allowance.  That statement only identified the lump sum nature of the temporary quarters allowance and did not signify that Petitioner had discretion to keep a lump sum benefit to which she was not entitled.  The Cartus representative had no authority to grant a benefit Petitioner did not qualify for under the F-15 Handbook (Finding 14).

[7] Additionally, a comment Petitioner made in the course of looking for another house undercuts her insistence that she intended the San Diego house to be a temporary residence while she searched for another house to be her permanent residence.  In an email communication with a friend regarding her search for a house in 2009, Petitioner commented, “I have no problem rehabbing if the payback is worth it.  Depending on the property, I would live in it (rent out my place), rent it or resell . . ..”  (Finding 21, fn. 2).  This suggests an investment motivation rather than an overriding interest in finding a permanent residence.