(c) Service agreements. The employee must have signed a service agreement as required in §302-1.5. In the event the employee violates the terms of the agreement, the Government reserves the right to recover from the employee any and all payments made to the relocation company on the employee's behalf.

(d) Ineligible individuals. Agencies should not make payments to relocation companies that will benefit ineligible individuals. For example, where joint ownership of a residence exists between an eligible transferring employee and a non-government

em

ployee, the benefits derived from relocation services could accrue equally to the ineligible party. This type of situation is addressed for direct reimbursements of real estate expenses under §302-6.1(f); similar provisions should be made for relocation service contracts.

[54 FR 20350, May 10, 1989, as amended by FTR Amdt. 26, 57 FR 28637, June 26, 1992]

§302-12.6 Form and scope of reloca

tion service contracts.

Once a decision has been made by the agency to enter into contracts to provide relocation services to its employees (see §§ 302-12.3 and 302-12.4), the agency shall recognize the following:

(a) General considerations. (1) Contracts for relocation services shall be awarded through a competitive process to ensure compliance with procurement law and attain the best possible service to meet a particular agency's relocation needs at the least cost to the agency. Agencies should attempt to assure that adequate geographic coverage exists.

(2) Relocation companies offer a wide variety of services to assist the relocating employee. Subject to these regulatory guidelines, each agency will determine through its contracts with the relocation companies the exact nature of the services to be offered its employees. Since the use of relocation companies could entail costs substantially in excess of those authorized in parts 302-1 through 302-10 of this chapter, agencies should exercise prudent management discretion when deciding which relocation services should be included in the contracts.

(b) Requirement that contracts not violate other regulatory or statutory provisions. (1) GSA has established certain travel and transportation programs that agencies are required to use. Examples are the centralized household goods traffic management program, the airline services contracts, and travel management center contracts. While similar services may be offered by relocation companies, agencies cannot use them. However, this restriction does not prohibit agencies from incorporating the GSA centralized household goods traffic management program, as a mandatory services source, into contracts with relocation service companies. Thus, relocation companies may act as third-party service firms to administer GSA's centralized household goods traffic management program on behalf of the contracting agency.

(2) Federal agencies should ensure that contracts with relocation companies that are on a cost reimbursable basis include only those services that are analogous to the allowable expenses authorized in this chapter, and that the payments for such services are limited to the maximum amounts specified in this chapter. Agencies must recognize that the statute and the provisions of this chapter contain certain limitations and restrictions which are not overridden by the new authority for relocation services. For example, the law:

(i) Prohibits payment for market losses. The provisions of 5 U.S.C. 5724a(a)(4), which authorize reimbursement for the expenses of the sale and purchase of employee's residence also provide that "reimbursement may not be made for losses on the sale of the residence.” As implemented in §302– 6.2(e), losses due to failure to sell a residence at the old official station at the price asked, at its current appraised value, or at its original cost, or due to failure to buy a dwelling at the new official station at a price comparable to the selling price at the old official station, and any similar losses, are not reimbursable.

(ii) Does not provide for payment of mortgage interest differentials. A mortgage interest differential is the difference between the interest rate of the mortgage on the residence at the

old official station and the interest rate of the mortgage on the residence being purchased at the new official station.

(iii) Does not authorize purchase of an employee's home. The law (5 U.S.C. 5724c) authorizes agencies to enter into contracts for relocation services and provides that such services may include "arranging for the purchase of a transferred employee's residence." However, it does not authorize the Government to become a homeowner either by direct purchase of the home from the employee or by taking title to the employee's home through the relocation company.

(c) Advantages of flat-fee contracts. If a relocation company agrees to accept the responsibilities of ownership for the transferred employee's residence after payment of a one-time flat fee by an agency, it would be offering a service clearly distinguishable from those discussed in paragraph (b)(2) of this section. Once the flat fee is established, it is paid instead of the actual expenses that normally would be paid by an agency under a cost reimbursable contract. This type of arrangement is advantageous in that it limits the Gov

ernment's financial obligation and simplifies administrative procedures in accounting for costs.

[54 FR 20350, May 10, 1989, as amended by FTR Amdt. 26, 57 FR 28637, June 26, 1992] § 302-12.7 Income tax consequences of using relocation companies.

In entering into contracts with relocation companies, agencies should consider the income tax consequences for the employee. Certain payments on behalf of the employee to a relocation company may constitute taxable income to the employee, depending on the specific terms of the contract. Under the provisions of 5 U.S.C. 5724b, additional taxes resulting from such income would be covered by the relocation income tax allowance as provided in part 302-11. For further information relating to the income tax consequences of payments to relocation companies, agencies should contact the Assistant Chief Counsel (Income Tax & Accounting), Internal Revenue Service, 1111 Constitution Avenue, NW., Room 5501, Washington, DC 20224.

[54 FR 20350, May 10, 1989, as amended by FTR Amdt. 26, 57 FR 28637, June 26, 1992]

§ 303-1.1 Authority, coverage, and applicability.

(a) Statutory Authority. This chapter sets forth the allowable expenses, not otherwise provided for by law, authorized by 5 U.S.C. 5742(b) for the preparation and transportation of the remains of a deceased employee, and for the transportation of the immediate family and household goods of a deceased employee.

(b) Persons covered. The provisions of this chapter cover an employee who dies while:

(1) On official travel away from his/ her official station in the United States.

(2) Performing official duties outside CONUS.

(3) Absent from duty as provided in § 303-1.5.

(4) Reassigned away from his/her home of record pursuant to a mandatory mobility agreement executed as a condition of employment.

(c) Applicability. The provisions of this chapter apply whether an employee's death is or is not work-related.

[FTR Amdt. 22, 56 FR 57289, Nov. 8, 1991, as amended by FTR Amdt. 26, 57 FR 28637, June 26, 1992]

§ 303-1.2 Responsibility.

It is the responsibility of the head of an agency or his/her designated representative upon being informed of an employee's death which occurred while in any status subject to the provisions of this subtitle, immediately to inform the decedent's next of kin or legal representative of the provisions of this

chapter. The agency head or his/her designated representative shall render every reasonable assistance in arranging for preparation and transportation of the remains of the decedent when death occurs during a travel status or at the official station outside CONUS. Also, the agency head or his/her designated representative shall provide necessary assistance for the return of the decedent's immediate family and household goods to the official residence when the decedent's official station was outside the continental United States.

[54 FR 20351, May 10, 1989, as amended by FTR Amdt. 22, 56 FR 57290, Nov. 8, 1991; FTR Amdt. 26, 57 FR 28637, June 26, 1992]

§303-1.3 Definitions.

As used in this chapter, and unless otherwise specifically provided in this chapter, the following definitions apply:

(a) United States. United States means the 50 States and the District of Columbia.

(b) Continental United States. The continental United States (or CONUS) means the 48 contiguous States and the District of Columbia.

[FTR Amdt. 22, 56 FR 57290, Nov. 8, 1991]

§303-1.4 Death related to performance of official duty.

When an employee's death results from injuries sustained while he/she was actually performing official duty, the expenses for preparation and transportation of the remains will be properly payable under the provisions of 5 U.S.C. 8134. The authorized allowances may not be denied because of the deceased employee's entitlement to burial benefits as a veteran of the Armed Forces of the United States.

[54 FR 20351, May 10, 1989. Redesignated by FTR Amdt. 22, 56 FR 57289, Nov. 8, 1991]

§ 303-1.5 Death during a period of absence from duty.

The provisions of this chapter apply when an employee is performing official travel away from his/her official station located in the United States and dies while temporarily absent from a temporary duty station. The provisions of this chapter also apply when

an employee is performing official duties outside CONUS and dies while temporarily absent from his official station or temporary duty station outside CONUS. If the temporary absence is for the purpose of taking leave or occurs during nonworkdays, the allowable cost for the transportation of remains shall not exceed the amount which would have been allowed if death had occurred at the temporary duty station or at the official station outside CONUS.

[FTR Amdt. 22, 56 FR 57290, Nov. 8, 1991]

§303-1.6 Escort for remains.

Travel expenses of an escort for the decedent are not allowable.

§303-1.7 Method of payment.

Payment of allowable expenses may be made direct to the person performing the services or by reimbursement to any person making the original payment. Claims for reimbursement shall be supported by receipts. When the remains are transported by common carrier via express service through the use of a Standard Form 1103, U.S. Government Bill of Lading, or through the use of a Standard Form 1169, U.S. Government Transportation Request, payment shall be made on the appropriate voucher forms.

[54 FR 20351, May 10, 1989. Redesignated by FTR Amdt. 22, 56 FR 57289, Nov. 8, 1991]

Sec.

PART 303-2-ALLOWANCES

303-2.1 Preparation of employee remains. 303-2.2 Allowable costs for preparation of

remains.

303-2.3 Transportation of employee remains. 303-2.4 Transportation of remains of a mem

ber of an employee's immediate family. 303-2.5 Allowable costs for transportation of employee remains.

303-2.6 Transportation of the immediate family and household goods. 303-2.7 Transportation of baggage. 303-2.8 Prohibition of payment when other laws apply.

AUTHORITY: 5 U.S.C. 5721-5734, 5741-5742; E.O. 11609, 36 FR 13747, 3 CFR, 1971-1975 Comp., p. 586.

SOURCE: 54 FR 20352, May 10, 1989, unless otherwise noted.

§303-2.1 Preparation of employee remains.

The amount allowed for preparing the remains of an employee who dies while traveling on official business within the continental United States is limited to $250. When death occurs during a travel status outside the continental United States or at the official station outside CONUS, the head of the agency concerned or his/her designated representative shall allow actual costs for preparation of the remains of an employee.

[54 FR 20352, May 10, 1989, as amended by FTR Amdt. 22, 56 FR 57290, Nov. 8, 1991] §303-2.2 Allowable costs for preparation of remains.

Allowable costs for preparation of remains are as follows:

(a) Costs of embalming or cremation; (b) Necessary clothing;

(c) Casket or container suitable for shipment to place of interment; and

(d) Expenses necessarily incurred in complying with local laws and laws at the port of entry in the United States applicable to the preparation of remains for transportation and burial.

§ 303-2.3 Transportation of employee remains.

(a) Death while performing official travel within the continental United States. When an employee dies while performing official travel within CONUS, payment is authorized for the cost of transporting the remains to the employee's place of actual residence, official station, or place of interment. The cost of transportation shall not exceed the cost to the place of actual residence or official station, whichever is more distant.

(b) Death while performing official duties outside the continental United States. When an employee dies while performing official duties outside CONUS, payment is authorized for the cost of transporting the remains to the employee's place of actual residence, official station, or place of interment. The cost of transportation shall not exceed the cost to the place of actual residence or official station, whichever is more distant.

[FTR Amdt. 22, 56 FR 57290, Nov. 8, 1991]