Board of Contract Appeals

                 General Services Administration

                      Washington, D.C. 20405





                           ____________



                          July 11, 2002

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                         GSBCA 15867-RELO





               In the Matter of DEVON SCOTT SHELLEY





     Devon Scott Shelley, Walla Walla, WA, Claimant.



     Major David J. Berczek, Deputy District Engineer, Real Estate Division, United States

Army Corps of Engineers, Department of the Army, Walla Walla, WA, appearing for

Department of the Army.



DeGRAFF, Board Judge.



     A relocated employee who purchases a house may not be reimbursed for excise taxes

that are customarily paid by the seller or for a buyer brokerage fee.  



                            Background



     Devon Scott Shelley is an employee of the United States Army Corps of Engineers. 

In November 2000, the Corps issued a travel authorization in connection with Mr. Shelley's

transfer to a new permanent duty station in Walla Walla, Washington.  The authorization

provided that the Corps would reimburse Mr. Shelley for real estate transaction expenses.



     Mr. Shelley decided to build a house near his new duty station and entered into a

buyer brokerage agreement with a real estate broker who represented his interests in

connection with that transaction.  Mr. Shelley and his broker say that such agreements are

common in the Walla Walla area.  Although the Corps reimbursed Mr. Shelley for some of

his real estate transaction expenses, it did not reimburse him for either a $4830 buyer

brokerage fee or $612 of excise taxes.  Mr. Shelley asks us whether the Corps correctly

denied his claim for reimbursement.



                            Discussion



       In order for an employee to be reimbursed for real estate transaction expenses, the

employee must have actually incurred the expenses.  41 CFR 302-6.1 (2001); Joint Travel

Regulations (JTR) C14000-F (Apr. 1, 2000).  Although the Corps did not reject Mr. Shelley's

claim for lack of proof that he paid the amounts he claims, there is nothing in our file to show

that he paid either $4830 to his real estate broker or $612 in excise taxes.  The buyer

brokerage agreement provides that Mr. Shelley would pay his broker a maximum fee of

$4830, but there is nothing to show what he actually paid.  Regarding the excise taxes, the

sales contract provides that the seller would pay the seller's excise taxes and the settlement

statement shows that excise taxes of $612 were paid by the seller, not by Mr. Shelley.  We

assume that the agency has information to show that Mr. Shelley actually paid the real estate

brokerage fee and the excise taxes for which he claims reimbursement, and we evaluate the

claim based upon that assumption.  



     The Corps correctly decided to deny Mr. Shelley's claim for reimbursement of the

amount that he paid to his real estate broker.  According to the regulations in effect when

Mr. Shelley reported for duty in Walla Walla, a transferred employee who built a house could

be reimbursed for real estate transaction expenses to the same extent as if he had purchased

an existing house, and a broker's fee paid in connection with the purchase of a house at a new

permanent duty station was not a reimbursable expense.  41 CFR 302-6.2, -6.2(d)(1)(x); JTR

C14002-A.1 (Apr. 1, 2000), -A.4.a(10) (Dec. 1, 2000); Richard A. Poisel, GSBCA 15330-

RELO, 01-1 BCA   31,284 (2000).  Even if buyer brokerage agreements are common in the

Walla Walla area, the amount Mr. Shelley paid to his broker is not reimbursable due to the

clear provisions of the regulations.  Richard G. Britner, GSBCA 15542-RELO, 02-1 BCA 

 31,774 (citing cases).  



     The Corps also correctly decided to deny Mr. Shelley's request for reimbursement of

the amount that he paid in excise taxes.  An excise tax paid in connection with a real estate

transaction is reimbursable in some circumstances.  Matthew D. Freeman, GSBCA 14416-

RELO, 98-1 BCA   29,606.  One requirement for reimbursement is that the tax must be

"customarily paid" by the purchaser.  41 CFR 302-6.2(d)(1).  According to the Corps, the

excise tax is usually paid by sellers, not buyers.  This is consistent with a Washington state

law that makes paying the tax the seller's obligation.  Wash. Rev. Code   82.45.080 (2000). 

In the absence of any facts to show that it is customary for buyers to pay the excise tax that

is levied on real estate sales transactions in Washington, the Corps properly denied

Mr. Shelley's claim for reimbursement.  



     Mr. Shelley says that he received incorrect advice from a Corps employee regarding

his real estate transaction expenses.  Incorrect or incomplete advice provided by an agency

employee does not provide the Corps with the authority to expend public funds contrary to

the provisions of published regulations.  Masood Badizadegan, GSBCA 14393-RELO, 98-2 

BCA   29,789.  Thus, even if Mr. Shelley received incorrect advice, the Corps properly

denied his claim for reimbursement.









                                   __________________________________

                                   MARTHA H. DeGRAFF

                                   Board Judge