_______________________________ December 23, 1997 _______________________________ GSBCA 14379-TRAV In the Matter of TIMOTHY P. TWIGG Timothy P. Twigg, California, MD, Claimant. David W. Neerman, Director, Program Development and Direction Division, Office of the Deputy Assistant Secretary of the Navy, Manpower and Reserve Affairs, Department of the Navy, Washington, DC, appearing for Department of the Navy. DeGRAFF, Board Judge. Regulations permit agencies to pay less than the maximum authorized per diem rate in some circumstances. Consistent with the regulations, an agency can pay an employee who is completing a long-term temporary duty assignment less than the maximum rate. Background On July 18, 1995, the Department of the Navy (Navy) authorized Timothy P. Twigg to travel from Patuxent River, Maryland to Eagan, Minnesota for an extended temporary duty assignment. Mr. Twigg s assignment was to begin on August 1, 1995, and was to last 365 days. The Navy told Mr. Twigg that, during his assignment, he would receive 55% of the maximum per diem allowance for the Eagan, Minnesota area. During and after his assignment, Mr. Twigg told the Navy that the 55% per diem allowance was insufficient. The Navy told Mr. Twigg that he would have to provide a justification and actual receipts or proof of expenses in order to receive approval for an increased allowance. Mr. Twigg provided the Navy with information concerning the average and median rent paid in Dakota County, Minnesota, which is where Eagan is located. He also gave the Navy the results of a survey that he conducted of local hotel costs, and he provided information concerning the cost of renting an apartment in Arlington, Virginia. Mr. Twigg also provided the Navy with three estimates of the monthly cost of living in Eagan, based upon three different assumptions concerning the conditions of a long-term temporary duty assignment. Mr. Twigg based the estimates in part upon his cost of renting a two-bedroom apartment and he said that this cost was supported by the results of a study concerning the cost of renting an apartment in an area that included Eagan. Mr. Twigg said that he considered the cost of renting a two-bedroom apartment to be in line with the cost of renting an efficiency apartment, although the study shows that the rent for a one- bedroom apartment was approximately $200 per month less than Mr. Twigg s cost of renting a two-bedroom apartment. Mr. Twigg s three cost of living estimates were also based in part upon an estimate of the costs he would have incurred if he had rented a washer, dryer, and furniture for a one-bedroom apartment. Mr. Twigg included 85% of the amount of his average electric, gas, water, and sewage bills in his estimates of the monthly cost of living in Eagan. Mr. Twigg explained that he included only 85% of the amount of these bills in his estimates because his apartment was a two-bedroom apartment and not a one- bedroom apartment. Mr. Twigg s estimates assumed that 55% of the per diem allowance for meals and incidental expenses was adequate if the Navy paid either for furniture rental or for moving a traveler s furniture, and that otherwise 100% of the per diem allowance for meals and incidental expenses would be required. The Navy decided that the information Mr. Twigg provided was not sufficient to justify an increase in the 55% per diem rate. Mr. Twigg asked us to review his claim. Discussion A federal employee who travels on official business is entitled to be paid a per diem allowance at a rate not to exceed the rate established by the Administrator of General Services. 5 U.S.C. 5702 (1994). In the Federal Travel Regulation (FTR), the Administrator of General Services establishes maximum per diem rates for lodging and for meals and incidental expenses. 41 CFR pt. 301, app. A (1995). The FTR emphasizes that the per diem rates it establishes are maximum rates, and explains that agency heads are responsible for authorizing only those per diem allowances that are justified given the circumstances of the travel. In addition, the FTR provides that an agency may authorize a per diem rate that is less than the maximum rate in certain circumstances. Before an employee travels, the FTR says that the agency should consider known factors that will cause the employee's per diem costs to be less than the maximum authorized rate. If any such factors exist, the agency should authorize a reduced rate that is consistent with the known expense levels. 41 CFR 301-7.2; 301- 7.12. One of the examples set out in the FTR for reducing the maximum per diem rate concerns extended stays. When a travel assignment involves an extended period and an employee is able to obtain lodging or meals at a lower cost (for example, if the employee has a weekly or monthly rental), the FTR states that the per diem rate should be reduced. 41 CFR 301-7.12. The Department of Defense issued the Joint Travel Regulations (JTR) to supplement the FTR for its civilian employees. The JTR provides that the applicable per diem allowance for a long-term temporary duty assignment (more than 180 days) is 55% of the maximum per diem rate. JTR C4552-K (Dec. 1, 1994); C4560 (Apr. 1, 1995); C4561-D1 (Dec. 1, 1994). The JTR permits an employee to receive more than 55% of the maximum rate when it can be factually determined" that payments of 55% of the maximum rate are not appropriate for a particular temporary duty assignment. JTR C4561-D2 (Dec. 1, 1994). The Navy s use of the 55% per diem rate in Mr. Twigg s case is consistent with the terms of the FTR, which permits agencies to authorize a per diem rate that is less than the maximum rate if factors such as an employee s ability to rent quarters will cause the employee s per diem costs to be less than the maximum authorized rate. Here, the Navy expected that Mr. Twigg would be in Minnesota for one year. An employee completing a long-term temporary duty assignment can lease an apartment with cooking facilities, as did Mr. Twigg, and incur fewer costs than an employee who travels for a shorter period of time and who stays in a hotel and eats meals in restaurants. By authorizing less than the maximum per diem rate for Mr. Twigg, the Navy acted consistently with the FTR s admonition that agency heads should authorize only those per diem allowances that are justified given the circumstances of the travel and should not always pay the maximum per diem rate. The Navy s use of the 55% per diem rate in Mr. Twigg s case is also consistent with the terms of the JTR, which sets the per diem rate at 55% of the authorized maximum rate if a temporary duty assignment will exceed 180 days. Mr. Twigg s assignment was for 365 days. The JTR permits the use of a higher rate if it can be factually determined that the reduced payments are inappropriate for a particular assignment. The Navy explained to Mr. Twigg that he needed to provide a justification and actual receipts or other proof of expenses in order to receive approval for a higher rate. Although Mr. Twigg provided information concerning the average and median rent paid in Dakota County, a survey of local hotel costs, and information concerning the cost of a renting an apartment in Virginia, this does not shed any light upon whether reduced per diem payments were inappropriate for Mr. Twigg s particular assignment. Mr. Twigg s three estimates of the monthly cost of living in Eagan were based upon the cost of renting a two-bedroom apartment, estimates of the constructive cost of renting a one-bedroom apartment, and assumptions which may or may not have been applicable to Mr. Twigg s assignment. The Navy decided that the information, surveys, and estimates that Mr. Twigg provided were not sufficient to justify approving a per diem rate in excess of 55% of the maximum authorized rate, and we cannot say that the Navy s decision was unreasonable, arbitrary, or capricious. The claim is denied. ________________________________ MARTHA H. DeGRAFF Board Judge