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element is a “transient addition to pay,” the authorization for which is repealed.
“ Transient additions” to pay as they were known to the naval service were additions to regular pay given for the assignment to and performance of special or additional duties. The one-fourth additional pay is given because the Government required the regular services of a man and was a consideration for retaining him beyond the period of which he had agreed to serve, and has no comparison with pay for additional duties. The repeal provision of section 10 has no application thereto, and I find nothing in the act of June 10, 1922, which operates against the continuance of the payment. Your question is answered accordingly.
PRINTING AND BINDING-TREASURY DEPARTMENT.
The printing of uncopyrighted forms, dependent for their utility on the ordi.
nary process of printing, does not come within the provision in act of February 17, 1922, 42 Stat., 372, for the purchase of tags, labels, and index cards printed in the course of manufacture, and is required to be done at
the Government Printing Office by act of March 1, 1919, 40 Stat., 1270. Comptroller General McCarl to the Secretary of the Treasury, September 1, 1922: I have your letter of August 18, 1922, stating as follows: With respect to the appropriation made for contingent expenses for stationery for the Treasury Department, as contained in Public No. 145, 67th Congress, it is desired to inquire whether printed forms, such as the sample herewith enclosed, could be purchased under this act without violation of the provisions of section 11, legislative act of March 1, 1919, 40 Stat., page 1270.
The form inclosed is a cross-reference sheet, stock form, of the Library Bureau, No. 03649E.
There are two appropriations for the Treasury Department in the act of February 17, 1922, 42 Stat., 372, cited, one of which may be available for the purpose of obtaining these forms, depending upon the application of the act of March 1, 1919, viz:
For stationery, including tags, labels, and index cards printed in the course of manufacture, for the Treasury Department and its several bureaus and offices, $160,000.
For printing and binding for the Treasury Department, including printing required by the Federal farm loan act, $500,000.
The submitted form does not appear to be copyrighted and its utility simply results from the ordinary process of printing. Under the act of March 1, 1919, all printing must be done at the Government Printing Office, and for such service the appropriation for printing and binding for the Treasury Department only is available.
Your inquiry is therefore answered negatively.
OFFICERS OF ARMY-DISCHARGED AND TENDERED LOWER COM
MISSIONS ON REORGANIZATION.
The refusal by Army officers to accept the commissions tendered them in lower
grades on their being discharged and tendered such commissions under the act of June 30, 1922, 42 Stat., 721, does not entitle them to the benefits conferred by that act on officers selected for elimination, and they do not by such refusal become entitled under the act to either one year's pay
by reason of their discharge or to retirement. Comptroller General McCarl to the Secretary of War, September 5, 1922:
I have your letter of August 11, 1922, reading as follows:
The act of June 30, 1922, making appropriations for the military and nonmilitary activities of the War Department for the current fiscal year, 42 Stat., 721, requires that a considerable reduction in the commissioned personnel of the Army as a whole, and particularly in certain grades and branches, be effected in the immediate future. That act, after specifying the number of officers which shall hereafter constitute the normal authorized strength of the various branches and grades, continues:
“ Provided further, That officers in excess of the numbers authorized herein and not removed from the active list by other means shall be disposed of as follows:
those other than of the Medical Department and Chaplains shall, prior to January 1, 1923, be eliminated from the active list as hereinafter provided except that not more than a total of eight hundred now in grades from colonel to first lieutenant inclusive shall either be continued as additional officers in their grades until absorbed, or those in grades below lieutenant colonel sball, in inverse order of standing on the promotion list beginning with the lowest on the list in each grade, be discharged and recommissioned in the next lower grade prior to January 1, 1923. * *; officers selected for elimination of less than ten years' commissioned service may, upon recommendation of the board herein provided for, be discharged with one year's pay; * * *: Provided further, That, of the eight hundred or less officers to be absorbed or recommissioned under the preceding proviso, a suitable number of officers in grades from colonel to first lieutenant, inclusive, shall be continued as additional until absorbed and a suitable number in each grade from major to first lieutenant shall be recommissioned in the next lower grade, such suitable numbers to be determined by the President upon the recoinmendation of the board of general officers hereinafter provided for:
Provided further, That the Secretary of War shall convene a board of five general officers
which board, under regulations prescribed by the Secretary of War, shall recommend to the President the officers to be eliminated from the active list under the provisions of this Act, the number of officers in the various grades to be recommissioned in the next lower grade as hereinbefore provided, and the number of officers in various grades to be continued as additional until absorbed as hereinbefore provided :
Apparently, in giving effect to that portion of the act which provides that a number of officers in the grades of major, captain, and first lieutenant be dis. charged and recommissioned in the next lower grade, the course of administra. tion may be directed along any one of several lines. When the act became effective the names of 2,191 officers of the grade of major were borne on the general promotion list. The newly authorized normal strength of that grade is 1,575. Assuming for the purpose of this communication that while the act under consideration is being carried into effect there will be no reduction in the number of majors through death, · resignation, or the operation of other laws, the majors in excess of 1,575, 616 in all, must be disposed of by (a) continuing a limited number in that grade as additional officers, (b) recommissioning a limited number in the grade of captain, and (c) eliminating the remainder from the active list of the Army. Assuming further that the board of general officers reconimends that 316 majors, designated by name, be elimi. nated from the active list, that 100 majors be continued in that grade as addi. tional officers, and that 200 majors be discharged and recommissioned in the grade of captain, and that the President approves these recommendations, the
recommendation that 200 majors be discharged and recommissioned as cap tains may be given effect in either one of two ways, viz:
First, by discharging cach of the 200 majors from his commission as a major and at the same time tendering him a commission as a captain; and,
Second, by tendering each one of the 200 majors a commission as a captain, with notice that the acceptance of the new coinmission of itself will serve to vacate the oflice theretofore held by him as completely as would the delivery of a formal certificate of discharge, and with further notice that if he formally decline the new comnission or fail formally to accept it on or before a specified date he will stand discharged from the Army on the latter date or on some other subsequent date specified in the notice.
It would appear that an officer tendered a recommission, who does not accept and who is therefore discharged, is not included in the total of 800 or less who may be held as additional in their gralles or discharged and recommissioned. His failure to accept prevents consummation of the operation of being discharged and recommissioned. Such an officer becomes therefore an excess officer removed from the active list by discharge and the question arises as to whether or not he is to be discharged with one year's pay.
As it is desirable to have the conditions under which a year's pay may be or must be paid to an officer who is separated from the Ariny in the operation of the act of June 30, 1922, clearly defined for the guidance of officers of the Finance Department, I request your decision as to which, if either, of the two courses of administration outlined above would result in entitling to year's pay an officer whom the duly approved recommendation of the board of gen. eral officers places in the list of those to be discharged and recommissioned in the next lower grade but who declines or fails to accept the new commission and whose connection with the service is severed by reason thereof.
Sufficient has been quoted from the law to show that the adjustment of numbers in the various grades required is to be made (1) by the elimination of a portion of the surplus officers in each grade; (2) by continuing a number of officers in each of the grades from colonel to first lieutenant (to be determined as therein provided) as additional until absorbed; and (3) by the discharge and recommissioning in the next lower grade of officers in grades from major to first lieutenant, the number to be determined as prescribed by the act.
It is only with respect to officers of the first class—those to be eliminated; that is, completely separated from the Army—that provision is made, but only on the recommendation of the board of general officers to that effect, for the payment of one year's pay or retirement on the basis fixed in the act. The board of general officers provided for is specifically required to recommend the officers to be eliminated from the active list, the number of officers in the various grades to be recommissioned, and the number of officers in the various grades to be continued as additional until absorbed.
Your question is, How or by what method officers of the third class—those to be discharged and recommissioned in the next lower grade—can receive the benefit of the provisions made for officers selected for elimination from the active list should they not wish to continue in the Army in the next lower grade? The act makes no provision for these officers other than a recommission in the next lower grade. If for any reason they decline to accept the benefit of this provision made in their behalf, there is no warrant for according them the benefits exclusively provided for another and entirely different class of otficers, and which these latter officers are entitled to only when specifically and individually recommended there for.
The statute requires that a certain number of officers in grades from major to first lieutenant shall be discharged and recommissioned in the next lower grade and provides that officers accepting recommission in the next lower grade shall have certain rights on the promotion list, etc. The statute is mandatory; it directs their discharge and a procedure which in a given case may or may not effectuate the intent of the statute and which places the officer, at his election, in one or the other of two of the three classes of officers when the law requires that he shall be definitely classified in one is not a compliance with the law. When an officer who has been selected for discharge and recommission in the next lower grade is discharged he is separated from the Army; if he declines to accept the commission in the lower grade his failure to continue in the Army is voluntary, and no provision is made for the payment to him in any circumstances of a year's pay.
You are therefore informed that the statute requires that the first method proposed in your letter must be followed, and that if in any case the officer declines to accept the commission in the next lower grade notice of the discharge effectually separates him from the Army and he may not thereafter be classified as selected for elimination; he was not in fact so selected and classified, and the statute does not authorize payment to him of one year's pay or retirement.
SUPPLEMENTAL CONTRACTS FOR CARRYING CHARGES OR
INTEREST ON DEFERRED PAYMENTS.
The deferring of contract payments beyond due dates because of insufficient
appropriations will not obligate the Government to pay carrying charges or interest thereon, and supplemental contracts made for that purpose are without consideration, and any payments thereunder are prohibited
by sections 3648, 5678, and 3679, Revised Statutes. Comptroller General McCarl to the Secretary of the Navy, September 5, 1922:
I have your letter of August 10, 1922, as follows:
I have the honor to submit, with request for approval of the department's action, a statement of the procedure followed in authorizing carrying charges to certain of the department's contractors. The contractors in question held fixed-price contracts for furnishing material and equipment for ships under construction on July 1, 1921. The subcontractors in question held similar fixed-price contracts for furnishing material and equipment to firms who, on July 1, 1921, held cost-plus-fee contracts with the department for the construc. tion of naval vessels. This request is based upon the authority given you by section 309 of the Budget act.
The following are the circumstances leading up to this action : The naval act for the fiscal year ending June 30, 1922, approved July 12, 1921, appropriated but $53,000,000 under " Increase of the Navy, construction and machinery,” which, with the small balance remaining unexpended and
available under this appropriation from previous years, was hardly more than sufficient to discharge the total material obligations which would fall due for payment during the fiscal year 1922 under contracts in force at the beginning of that year.
The carrying charges referred to are to cover the additional expenses incurred due to the deferring of deliveries and payments under the above contracts and subcontracts. The carrying charges do not include any additional profit.
It was obvious that if nearly all of the money available was devoted to meeting the above material obligations, the amount remaining to pay for labor charges and other expenses in the shipbuilding yards would be so small that practically no progress could be made during the year in the actual construction of the vessels in hand.
Such a condition would have necessitated a great reduction of force in the building yards, amounting in some instances to practically closing the plant, seriously impairing or even wholly destroying the yard organizations and dispersing large numbers of skilled workinen. Such a step would have led to greatly increased cost when the time came to resume work on the vessels, as it would then be necessary to build up again the yard organizations, a slow and expensive proceeding.
The Navy Department is chargeable with a large proportion of the shipbuilders' overhead expense, much of which is of such a nature that it continues regardless of the amount of work in hand. If no progress were made on the vessels building, the share of overhead expense payable by the Navy Department would be unaccompanied by any corresponding advancement of the vessels, and would, therefore, be wholly wasted.
For the above and other reasons, a practical cessation of work in the shipbuilding yards would have been extremely wasteful and disadvantageous to the Government, and the department, after a conference with the principal shipbuilders concerned, authorized them to utilize approximately one-half of the money allotted to them for the fiscal year for the purpose of carrying on work in their yards, the other half of the money to go toward meeting their obligations for materials.
This latter sum was far less than the total of such obligations as would fall due during the year, and it was consequently necessary for the principal building yards to arrange with the various material men for suspending or reducing production of unfinished materials, postponing shipment of completed materials, or deferring payment for material which it was decided to deliver.
These measures could, of course, be taken only with the consent of the contractors or subcontractors, and it is obvious that they involved additional ex. pense for insurance, storage, interest on borrowed money, premium on bonds, handling material, and increased overhead expense.
As all of these material contracts were for a fixed price or fixed unit price, it was, in many cases, impracticable for the contractors to accept the modified conditions as to delivery and payments unless they were reimbursed for at least a portion of these miscellaneous extra costs.
The department has, therefore, whenever necessary, approved, either by formal supplementary agreement or as a change under the existing contract, a modification of the price so as to include a small additional allowance to cover these various carrying charges.
The department is of the opinion that the allowance of these charges is justi. fied, both legally and equitably, by the considerations moving to the Government stated in the fourth and fifth paragraphs above. It is clear that the delivery of millions of dollars worth of machinery, equipment, and material of all sorts for ships on which no work was being done and on which the material would not be installed, would have caused endless confusion, as well as losses and deterioration, amounting to very large sums of money. By enabling the building yards to postpone deliveries of material and carry on the work of building the vessels, although at a greatly reduced rate, these losses were practically eliminated.
There are enclosed herewith copies of typical contracts and letters author. izing allowance of such carrying charges.
The appropriation referred to provides for
INCREASE OF THE NAVY, CONSTRUCTION AND MACHINERY: On account of hulls and outfits of vessels and machinery of vessels heretofore authorized, to be available until expended, $53,000,000. Act of July 12, 1921, 42 Stat., 139.