(A-56098)

SCHOOL TEACHERS, DISTRICT OF COLUMBIA-COMPENSATION A school teacher in the District of Columbia public schools separated from her position by resignation may not upon reappointment be given a salary in excess of that permitted to new appointees by the act of June 4, 1924, 43 Stat. 373, and may not be advanced after such appointment except in the manner prescribed by the statute, that is, after serving 1 year in each automatic rate.

Comptroller General McCarl to the President, Board of Commissioners of the District of Columbia, November 5, 1934:

There has been received your letter of October 18, 1934, as follows:

The Commissioners of the District of Columbia are in receipt of an urgent request from the Superintendent of Schools that they resubmit to you for further consideration the following additional facts relating to the present status of Mrs. Page T. Kirk, public school teacher at the Western High School:

"Mrs. Kirk and some of her friends are earnestly asking that the Commissioners of the District of Columbia be requested to resubmit her case to the Comptroller General. We are, of course, anxious to do everything that we can to serve this teacher, not only from the point of view of the strict interpretation of the law, but from the very unusual features involved which would seem to establish a reason for certain equitable considerations.

"It seems to me that the following reasons might very properly be included in the resubmission to the Comptroller General in addition to your former letter submitted in the early part of June. The purpose of submitting the following additional information would seem to be to emphasize the unusual nature of her case and the real equitable consideration which might be extended to her.

"Mrs. Kirk was forced to terminate her service by a misunderstanding of the Government department in which her husband worked. The ruling under which she was forced to resign was never carried out but was immediately withdrawn allowing her to be reappointed.

“Mrs. Kirk did not miss a single day of service. Her resignation and reappointment occurred in the vacation period.

"When the technical resignation was forced under misapprehension of the Government she was drawing the maximum salary ($2,800) of group 3A, and if equitable instead of strictly legal consideration could have been accorded her she would have been restored at $2,800 instead of $2,300.

"The law requires that candidates for 3B must have reached the maximum of 3A. This Mrs. Kirk had enjoyed for some years before the technical termination of her services. If she can be given the advantage of this fact rather than the fact that she was drawing $2,300 at the time of her proposed promotion, the school officers feel that she should be given this opportunity. There seems to be real ground for believing that the $2,300 was not her equitable salary.

"It is the hope of the Superintendent of Schools that you will be able to convince the Commissioners that a resubmission of this case would be desirable in justice to this excellent teacher who has been so heavily penalized by pure technicalities."

This information is intended to supplement that contained in our letter of June 12, 1934, to which you answered in the negative under date of July 9, 1934. The Superintendent of Schools stated in an earlier communication that it is not his desire to prejudge the claim of Mrs. Kirk, but that he feels the matter ought, in fairness to her, be resubmitted for your further consideration.

The question for consideration is whether there is any legal objection to this teacher's being promoted from her present salary of $2,300 in group A to the minimum salary of $2,900 in group B, for which promotion she qualified before she terminated from service.

It would appear to be the contention of the Superintendent of Schools that Mrs. Kirk was not actually separated from the service in that the time between her resignation and reinstatement occurred during a vacation period, when no services would have been required

of her. Such circumstances, however, cannot overcome the fact that she was actually out of the service of the District of Columbia upon her resignation as school teacher, and was not reinstated until some 2 months later. In 10 Comptroller General 546, the general rule was stated as follows:

In decisions construing statutes providing for automatic promotion of personnel annually, and requiring that original or new appointment shall be made at the basic or minimum automatic salary rate, this office has held consistently that reinstatements were to be considered as original or new appointments, and, therefore, that only the minimum salary rate was payable initially upon reinstatement. * * *

This rule was upheld in decision of July 30, 1934, by the United States Court of Appeals for the District of Columbia in the case of District of Columbia v. Warren W. Smith in which the court cited the rule as laid down in that decision. The pertinent portions of the applicable statute controlling appointments and promotions of school teachers were quoted in my decision of July 9, 1934, and will not be repeated here. In reappointing Mrs. Kirk to class 3 A, she was not given the minimum salary of that class, but was given the maximum credit for former teaching experience authorized for new appointees by the act of June 4, 1924, 43 Stat. 373. The statute does not provide for skipping any automatic salary step after appointment but requires one year's service in each automatic rate in class A, and one year's service in the maximum salary rate in class A, before selection and promotion to class B. Accordingly, there is no authority at the present time to promote Mrs. Kirk beyond the rate in class 3 A to which she is entitled by reason of service since her reappointment. The decision of July 9, 1934, must be and is affirmed.

(A-57845)

COMPENSATION-ADMINISTRATIVE PROMOTION-ALLOWANCES IN

KIND

In determining whether an administrative promotion has been made in contravention of law, the total salary rate fixed for the employee, including both the cash paid and the determined value of allowances furnished in kind, must control, and not the amount of cash paid only.

Comptroller General McCarl to Maj. E. T. Comegys, United States Army, November 5, 1934:

There has been received, through the Chief of Finance, War Department, your request of September 14, 1934, for review of the disallowance in your accounts for July 1933, of the difference between the compensation paid to Ora L. Mandell, seamstress, station hospital, Fort Sam Houston, Tex., at the rate of $780 per annum and compensation at the rate of $750 per annum, the disallowance being for the reason it appeared the increase in salary rate from $750 to $780 per annum involved an administrative pro

motion in contravention of section 202 of the Economy Act and section 7 of the act of March 3, 1933, 47 Stat. 1515.

The salary rate of $750 per annum paid prior to July 1, 1933, was without subsistence allowance. The salary rate of $780 fixed as effective on July 1, 1933, represented $480 cash and $300 as the fixed value of subsistence furnished, making an actual reduction in the amount of cash paid but an increase of $30 per annum in the total salary rate.

Under date of June 20, 1934, the following administrative reply was made to the exception noted by this Office:

1. Reference voucher #286, August 1933, pay roll for July 1-31, 1933, accounts Major E. T. Comegys, F. D., page 1, line 6, Mandell, Ora L. (seamstress), under remarks and after "$25.00 ded. for subs. allow." there should appear "Demoted from $750 cash salary and no allowances to $480.00 and $300.00 subsistence allowance per annum.

2. Mrs. Mandell's pay status, old and new, is shown below, proving that her last pay status was a reduction in pay, rather than a promotion even though on paper it appears otherwise.

3. The actual cost of subsistence to the Government is approximately $10.20 per month for the fiscal year 1934. Under the old salary she received $50.92, plus $2.20 retirement deduction, equals $53.12. Under the new salary she receives $27.97, plus $2.28 retirement deduction, plus ($10.20 cost of subsistence to the Government) equals $40.45. The actual savings to the Government from the old rate of pay to the new rate is actually $12.67 per month instead of a loss as it appears on paper transaction of pay rolls.

Under the provisions of section 3 of the act of March 5, 1928, 45 Stat. 193, the reasonable value to the employee of allowances furnished in kind to Federal personnel is required to be determined and considered as a part of compensation in fixing salary rates. There have been many decisions of the office holding that the value of allowances determined pursuant to this statute is to be regarded exactly as though the employee received the same amount in cash in connection with any question involving the total salary rate of an employee, the furnishing by the Government of such allowances to the employee being regarded as having relieved the employee from expending the said value for such allowances.

Therefore, in determining whether an administrative promotion has been given in contravention of law, the total salary rate fixed for the employee, including both the cash paid and the determined value of allowances furnished in kind, must control, and not the amount of cash paid only. On this basis, it is apparent that an administrative promotion was granted in this case and the audit action disallowing credit for the amount in question in your accounts must be and is sustained.

(A-58385) (A-58452)

CONTRACTS-TRANSPORTATION OF AIR MAIL

Under the provisions of section 3 (a) and (g) of the act of June 12, 1934, 48 Stat. 933, the compensation payable to a contractor for the transportation of the air mail under a temporary contract then in force was not only limited by the terms of the temporary contract, but the terms of the temporary contract were further limited by the rates stated in the act, and no temporary contract was authorized to be extended unless the contractor agreed in writing to comply with all the provisions of the act during the extended period.

Comptroller General McCarl to the Postmaster General, November 5, 1934:

Consideration has been given to your letter, without date, received October 24, 1934, and to your two letters of October 25, 1934, with enclosures, concerning differences between the Post Office Department and the Post Office Department division of this office with respect to the proper interpretation of certain provisions in the act of June 12, 1934, 48 Stat. 933, as applied to contract dated May 4, 1934, between the United States and United Air Lines, Inc., for the transportation of mail by air over route no. AM-1 from Newark, N. J., via certain designated points to Oakland, Calif., and return, and to certain other similar contracts where the differences are the same.

As the same rule or legal principle appears applicable to all of these contracts, it seems proper at this time to limit consideration to this contract with the United Air Lines, Inc.

Preliminarily, it may be said that under the Air Mail Act of February 2, 1925, 43 Stat. 805, as amended, the then Postmaster General had entered into a number of contracts, made extensions thereof, and issued route certificates for periods of 10 years for the transportation of air mail. On February 9, 1934, the present Postmaster General canceled a number of such existing contracts and route certificates. After some little delay, the mail was transported by air over some of the routes or parts thereof by the Army Air Service until there was advertisement for bids and contracting, in this case on May 4, 1934, with private concerns for the transportation of mail by air. This contract of May 4, 1934, with the United Air Lines, Inc., was for a period of 3 months from the date of commencement of service thereunder, which could be extended for two periods of not more than 3 months each or portions thereof, at the option of the Postmaster General, at a rate not greater than that paid for the first 3 months' period which was stipulated in the contract at 38 cents per airplane-mile for the initial unit of 70 cubic feet of air-mail space with additional space to be furnished upon demand at the rate of $0.54285 per cubic foot of air-mail space, subject to the restriction that in no case would the rate be in excess of 42 cents per airplanemile. Shortly after service was commenced under the contract, and

after a Senate investigation of complaints, etc., of the contractors whose contracts and route certificates had been canceled, there was enacted the act of June 12, 1934, which provided, in pertinent part, in section 3 (a) and (g) as follows:

SEC. 3. (a) The Postmaster General is authorized to award contracts for the transportation of air mail by airplane between such points as he may designate, and for initial periods of not exceeding one year, to the lowest responsible bidders tendering sufficient guaranty for faithful performance in accordance with the terms of the advertisement at fixed rates per airplanemile: Provided, That where the Postmaster General holds that a low bidder is not responsible or qualified under this act, such bidder shall have the right to appeal to the Comptroller General who shall speedily determine the issue, and his decision shall be final: Provided further, That the base rate of pay which may be bid and accepted in awarding such contracts shall in no case exceed 33 cents per airplane-mile for transporting a mail load not exceeding three hundred pounds. Payment for transportation shall be at the base rate fixed in the contract for the first three hundred pounds of mail or fraction thereof plus one-tenth of such base rate for each additional one hundred pounds of mail or fraction thereof, computed at the end of each calendar month on the basis of the average mail load carried per mile over the route during such month, except that in no case shall payment exceed 40 cents per airplane-mile.

(g) Authority is hereby conferred upon the Postmaster General to provide and pay for the carriage of mail by air in conformity with the terms of any contract let by him prior to the passage of this act, or which may be let pursuant to a call for competitive bids therefor issued prior to the passage of this act, and to extend any such contract for an additional period or periods not exceeding nine months in the aggregate at a rate of compensation not exceeding that established by this act nor that provided for in the original contract: Provided, That no such contract may be so extended unless the contractor shall agree in writing to comply with all the provisions of this act during the extended period of the contract.

Obviously, the act of June 12, 1934, constituted legislative ratification of the action of the Postmaster General in advertising and contracting on a temporary basis for the transportation of the air mail over air mail routes subject to the restrictions and limitations contained therein. The pertinent restrictions and limitations are those stated in the above-quoted section 3 (a) and (g) of the act of June 12, 1934, to the effect that notwithstanding what compensation may have been stated in the temporary contracts, the base rate of pay should in no case exceed 33% cents per airplane mile for transporting a mail load not exceeding 300 pounds plus one-tenth of such base for each additional 100 pounds of mail or fraction thereof computed at the end of each calendar month, but in no case should the aggregate payments to the contractor exceed 40 cents per airplane mile. Also, the Postmaster General was authorized to extend any such temporary contracts for an additional period or periods not exceeding 9 months in the aggregate at a rate of compensation not exceeding "that established by this act nor that provided for in the original contract." No contract could be so extended "unless the contractor shall agree in writing to comply with all the provisions of this act