_______________________________ November 25, 1997 _______________________________ GSBCA 14269-RELO In the Matter of BRIAN E. COOPER Brian E. Cooper, Battle Creek, MI, Claimant. Maj. Milagros Santiago-Madera, Chief, Financial Management Customer Support Branch, Air National Guard Readiness Center, Department of the Air Force, Andrews Air Force Base, MD, appearing for Department of the Air Force. DeGRAFF, Board Judge. In this claim, the Board applies three legal principles in accordance with regulations in effect in 1994. First, a transferred employee who was authorized to ship his household goods using a Government bill of lading and who decided to make his own shipping arrangements is not always entitled to be reimbursed for all of the shipping expenses that he incurred. Second, under regulations which have since been amended, an agency could reimburse an employee for more than sixty consecutive days of temporary quarters subsistence expenses only if an event occurred during the initial sixty days which was beyond the control of the employee and which created a compelling reason for the employee to continue to occupy temporary quarters. Third, a type of home sale expense that had been paid for approximately five years by ninety percent of the sellers in an area was customarily paid in the area. Background In 1994, Brian E. Cooper was a civilian employee of the Department of the Air Force (Air Force) and was working at the Willow Grove Air Reserve Station in Pennsylvania. In December 1994, Mr. Cooper accepted a position with the Air Force at the Michigan Air National Guard Base in Battle Creek, Michigan. For reasons that are not explained by our record, Mr. Cooper resigned his position in Pennsylvania and left for Michigan without first receiving any orders authorizing his change of station. Mr. Cooper arrived in Michigan on December 9, 1994. That same day, the Air Force prepared the orders that authorized Mr. Cooper to travel from Pennsylvania and to relocate to Michigan. Concerning the shipment of Mr. Cooper s household goods from Pennsylvania to Michigan, the orders state: Household goods will be shipped Government Bill of Lading. When it has been determined that GBL is the most econimical (sic), and the employee chooses to make his own arrangements, the employee may be reimbursed for actual expenses incurred and will not exceed the GBL rate. The Air Force gave Mr. Cooper a handbook that explained that there were two methods for shipping household goods. Using the actual expense method, the Government would arrange for the move, ship the goods using a Government bill of lading (GBL), and then pay the carrier for its services. Mr. Cooper's orders also provide that the Air Force would reimburse him for his temporary quarters subsistence expenses (TQSE) for sixty days, and for his real estate expenses. The Air Force later amended these orders to provide that it would reimburse Mr. Cooper for an added twenty days of TQSE. Mr. Cooper submitted a claim for TQSE from December 8 through 19, 1994, and from January 17 through March 20, 1995, and the Air Force paid the claim. The break between December 19, 1994, and January 17, 1995, was authorized due to official necessity. In July 1995, Mr. Cooper obtained estimates from several moving companies for the shipment of his household goods to Michigan. He asked one of the companies to send the Air Force an estimate of the cost of his move, which the company did. Neither Mr. Cooper nor the moving company explained why the moving company sent the estimate to the Air Force. The Air Force received the estimate and thought that it was an estimate of the cost of Mr. Cooper's "GBL move to [Michigan]," according to a notation that an Air Force employee made on the face of the estimate. Mr. Cooper arranged with the moving company to transport his household goods from Pennsylvania to Michigan, and the goods were shipped in late July and arrived in Michigan on August 1. The bill of lading that Mr. Cooper signed is an Allied Van Lines bill of lading, and not a Government bill of lading. The Air Force did not know that Mr. Cooper had arranged to ship his household goods. When the goods arrived in Michigan, the moving company would not release them until it had been paid the amount due for its services, $4,421.24. Mr. Cooper assumed that the Air Force would pay the moving company, but the Air Force told Mr. Cooper that he should have contacted the traffic management office in order to arrange for the shipment of his household goods using a GBL, as authorized by this travel orders. The Air Force reimbursed Mr. Cooper $3,152 for the shipment of his household goods. The Air Force calculated that this is the amount that it would have paid to ship Mr. Cooper s household goods if it had arranged the shipment and used a GBL. This amount includes transportation charges, as well as charges for packing and other services. Mr. Cooper claims $1,269.24 for the shipment of his household goods. This amount is the difference between the moving company s charges and the Air Force s payment to Mr. Cooper for the shipment of his household goods. The Air Force s position is that Mr. Cooper s travel orders authorized him to ship his goods using a GBL, and it paid Mr. Cooper the maximum amount that it would have paid if Mr. Cooper had complied with his travel orders. Mr. Cooper also claims $577.81 for TQSE that he incurred between July 28 and August 3, 1995. The Air Force s position is that Mr. Cooper is not eligible to be reimbursed for TQSE for this period because TQSE days must run consecutively unless they are interrupted for travel between duty stations, official necessity, or some occurrence beyond the employee s control and acceptable to the agency, such as illness. Mr. Cooper owned a house in Pennsylvania, and he received a purchase offer for the house on August 2, 1995. The offeror asked for a credit of $2,300 toward his closing costs. After reviewing agency regulations and discussing his circumstances with agency employees, Mr. Cooper understood that the Air Force would reimburse him for this credit if it was a customary expense in the area. The Air Force told Mr. Cooper that he should obtain a letter from someone such as a real estate agent stating that it was customary in the area for a seller to provide a credit toward the buyer s closing costs. Mr. Cooper s real estate agent wrote the following letter in early September 1995: Please be advised that your home . . . has been on the market approximately 270 days with a previous real estate office and approximately thirty (30) days with CENTURY 21 Drumheller. In the Tri-County area, which encompasses Montgomery, Chester, and Delaware counties, it is normal procedure to incorporate seller assist. As a matter of fact, it is true, in one out of every three transactions the seller allows three to six points in order for the buyer to close. In your case, your buyer has no other alternative. In order for you to close this transaction, I urge you to seek financing to consummate your deal. Mr. Cooper closed the sale of his house on September 28, 1995. The buyer s total closing costs were $2,713.06, and Mr. Cooper allowed the buyer a $2,300 credit for closing costs. Mr. Cooper submitted a claim for reimbursement of the expenses he incurred in selling his house, and the Air Force paid Mr. Cooper most of what he claimed. Mr. Cooper's claim included $2,300 for the credit that he gave to the buyer, which he said was an incidental expense of selling his house. The Air Force did not reimburse Mr. Cooper for this amount because the Air Force was not convinced that the such expenses were customarily paid by sellers in Mr. Cooper s area of Pennsylvania. After we received this claim, we told Mr. Cooper what our standard is for determining whether an expense is "customarily" paid. We asked that Mr. Cooper contact his real estate agent, let her know what we consider to be customarily paid, and find out whether, at the time he sold his house, a seller customarily paid for a credit to the buyer for closing costs. On October 23, 1997, Mr. Cooper's real estate agent responded that, beginning approximately five years ago, it became customary for sellers to assist buyers with closing costs in the area where Mr. Cooper's house was located, and that this practice remains in effect today for approximately ninety percent of residential sales. Discussion Mr. Cooper asks us to review the Air Force s denial of his claims for shipping his household goods ($1,269.24), for TQSE ($577.81), and for home sale expenses ($2,300). As explained below, the Air Force does not owe Mr. Cooper any additional amount for either the shipment of his household goods or TQSE. The Air Force should reimburse Mr. Cooper an added $2,300 for his home sale expenses. Household Goods Shipping Expenses Statute provides that under such regulations as the President may prescribe, an agency shall pay from Government funds the expenses of transporting, packing, crating, temporarily storing, draying, and unpacking the household goods of an employee moving to a new permanent duty station. 5 U.S.C. 5724(a) (1994). In Executive Order 11609 (July 22, 1971), the President delegated to the Administrator of General Services the authority to issue regulations implementing 5 U.S.C. 5724 and related statutes concerning travel and relocation of Government employees. This delegated authority underlies the Federal Travel Regulation (FTR) issued by the Administrator, 41 CFR chs. 301-304 (1995). The FTR applies to all civilian employees of Government executive agencies, including civilian employees of the Department of Defense. 41 CFR 301-1.2(a). The FTR establishes two methods for reimbursing employees for the transportation of their household goods. One method is referred to as the "actual expense" method. Using this method, the Government assumes full responsibility for transporting the goods. The Government makes all of the arrangements for moving the employee's household goods, selects a carrier, prepares a GBL that establishes the conditions of the move, and pays the carrier for its services. 41 CFR 302-8.3. The Federal Property Management Regulations (FPMR) provide that when an agency decides that the actual expense method shall be used and the employee chooses either to move himself or to use a carrier other than the one than the agency would have used, the agency will pay no more than it would have paid if the employee's household goods had been moved in one lot and on one GBL by the lowest cost carrier providing the level of service required. 41 CFR 101-40.203-2. The Air Force's position is quite simple: It paid Mr. Cooper the amount that it would have paid to ship his goods in accordance with his travel orders and it should not pay him anything more. Mr. Cooper's travel orders provided that his household goods would be shipped using a Government bill of lading. The handbook that he received explained that the Government would make all of the arrangements for a move when a Government bill of lading was used. The travel orders also provided that, if Mr. Cooper made his own arrangements for moving his household goods, the Air Force would pay no more than it would have paid if he had shipped the goods using a Government bill of lading. The Air Force paid the maximum amount that it said it would pay when it issued Mr. Cooper's travel orders. Mr. Cooper says that the Air Force should reimburse him for the amount that he paid to his moving company, which is more than his travel orders provided he would receive, because the Air Force never explained what procedures he should follow in moving his household goods. He says that the handbook he received in Michigan implied that he was supposed to gather cost estimates and provide those "for further guidance." He also says that the Air Force never responded to the estimate it received from his moving company, which must mean that the Air Force approved of his use of a moving company. Mr. Cooper's arguments are not persuasive. The Air Force told Mr. Cooper in his travel orders that he was supposed to use a Government bill of lading to move his household goods. The handbook explained that, when a GBL was used, the Air Force would make the arrangements for the employee's move. Mr. Cooper says that he read the handbook to say that he was supposed to gather cost estimates in order to receive further guidance, but he did not wait to receive any guidance after he gathered his cost estimates. Before Mr. Cooper's household goods were shipped, he did not tell the Air Force that he had arranged for a moving company to transport his goods. Mr. Cooper made his own arrangements for his move, and his household goods were shipped using an Allied Van Lines bill of lading. The estimate that his moving company sent to the Air Force did not explain why the estimate was being sent. Neither Mr. Cooper nor the moving company asked the Air Force either to approve using the moving company or to agree to pay the moving company's charges, and the Air Force's failure to respond to an unsolicited estimate cannot be taken as the Air Force's promise to reimburse Mr. Cooper for the cost of the moving company. The Air Force reimbursed Mr. Cooper for the maximum cost that it would have incurred had he shipped his household goods in accordance with his travel orders. The Air Force is not obligated to reimburse Mr. Cooper for the amount that he paid to Allied Van Lines. Temporary Quarters Subsistence Expenses When an employee makes a permanent change of duty station, the agency can reimburse the employee for TQSE for a period of not more than sixty consecutive days. When Mr. Cooper was transferred, the agency could extend the period for up to an additional sixty consecutive days provided that an event occurred during the first sixty-day period which was beyond the employee s control and which created a compelling reason for the employee to continue to occupy temporary quarters. The period of consecutive days could be interrupted only for time to travel between the old and new duty stations, for official necessity, or for non- official necessary reasons that were beyond the employee s control and acceptable to the agency, such as hospitalization. 41 CFR 302-5.2; JTR C13004-1a, 1b; C13005-1a (Feb. 1, 1994). The Air Force reimbursed Mr. Cooper for TQSE that he incurred in December 1994, and in January through March 1995. Mr. Cooper asks to be reimbursed for additional TQSE that he incurred in late July and early August 1995. For two reasons, Mr. Cooper is not entitled to be reimbursed for the TQSE that he requests. First, nothing happened during Mr. Cooper s first sixty days in temporary quarters that created a compelling reason for him to remain in temporary quarters several months later. Second, the days for which Mr. Cooper now asks to be reimbursed did not run consecutively with his authorized TQSE periods, and the gap between March and July 1995, was not created due to travel, official necessity, or any non-official necessary reason beyond Mr. Cooper s control and acceptable to the Air Force. According to the applicable regulations, therefore, Mr. Cooper is not entitled to be reimbursed for the $577.81 of TQSE that he requests. Home Sale Expenses When an employee makes a permanent change of duty station, the agency will reimburse the employee for the expenses of selling the residence at the old duty station that he is required to pay. The expenses cannot exceed those customarily charged in the locality. 5 U.S.C. 5724a. Incidental charges made for required services in selling a residence are reimbursable if they are customarily paid by the seller, and if they do not exceed amounts customarily charged in the locality. 41 CFR 302-6.2(f); JTR C14002-1f (Dec. 1, 1994). The Air Force did not reimburse Mr. Cooper for the $2,300 credit that he gave to his buyer because the Air Force did not believe that the credit was customary, based upon the information that Mr. Cooper had provided. Because the September 1995 letter written by Mr. Cooper's real estate agent does not specifically mention whether a credit for closing costs is customarily paid, we asked Mr. Cooper to contact his real estate agent and ask whether she had any information concerning whether it was customary for the seller to provide a credit for a buyer's closing costs, in light of our interpretation of customarily paid. We explained to Mr. Cooper that we consider an expense to be customarily paid if by long and unvarying habitual actions, constantly repeated, such payment has acquired the force of a tacit and common consent within a community. Christopher L. Chretien, GSBCA 13704-RELO, 97-1 BCA 28,701 (1996). The real estate agent's October 23, 1997 letter explains that the type of credit that Mr. Cooper gave to his buyer has been paid by sellers in ninety percent of residential sales transactions for approximately five years. In the view of Mr. Cooper s real estate agent, this fulfills our definition of customarily paid. We agree. Mr. Cooper is entitled to be reimbursed for the added $2,300 of home sale expenses that he requests. Decision The agency correctly decided not to reimburse Mr. Cooper the added amounts that he requests for his moving expenses and for TQSE. Mr. Cooper is entitled to be reimbursed for the credit that he provided to the purchaser of his home in Pennsylvania. -------------------- MARTHA H. DeGRAFF Board Judge