In the Matter of Jennifer A. Miller, 2017 WL 3114027
The Civilian Board of Contract Appeals (CBCA) decided this case. As part of the General Services Administration (GSA), the CBCA hears various cases concerning federal agencies in the executive branch. Under the Contract Disputes Act (41 U.S.C. 7101-7109), the CBCA conducts dispute resolution between government contractors and agencies.
Government Transfers Background
In November 2015, U.S. Air Force employee Jennifer A. Miller was transferred from Florida to Virginia. As a result of this permanent change of station (PCS), Miller was eligible for reimbursement of real estate transaction expenses. Miller had one year to complete all real estate transactions related to moving to her new permanent duty station (PDS) in Virginia.
As a result, Miller attempted to complete two activities – selling her Florida condo and purchasing a Virginia home – within the one-year timeframe.
Concerning the Florida condo, Miller first listed the property for sale with a realtor in April 2015. Miller attempted to sell her Florida condo for approximately 487 days, cycling through three realtors and reducing the price three times. Miller also leased her apartment to tenants several times to reduce her overall costs. Outside of a one-month period in August 2016, the property was listed the entire time. But Miller had only received one offer by March 2017.
Meanwhile, Miller reported to her new PDS in Virginia on November 19, 2015. That same month, Miller ramped up her house-hunting activities. While searching for a new home, Miller leased an apartment for one year. Miller also completed several house-hunting activities, including but not limited to mortgage preapproval, down payment, property viewings, and neighborhood research.
Given the competitive housing market in and around Arlington, Virginia, Miller engaged several realtors to help with her search. Ultimately, she submitted an offer for a property in October 2016. During the inspection process, however, Miller discovered severe code violations and backed out of the deal.
As the one-year deadline loomed, Miller submitted a request for a one-year extension. Miller provided evidence in support of her efforts to sell the Florida condo and buy a Virginia home. She also cited evidence of the extremely competitive nature of the housing market in the national capital region.
The government denied Miller’s request for an extension.
Concerning sale of the Florida condo, the government determined that:
- Miller did not list her property for the bulk of 2015-2016.
- Miller’s decision to rent to tenants deterred potential buyers.
- Miller did not reduce the price to help incentivize a timely sale.
Concerning purchase of a Virginia home, the government determined that:
- Miller’s dual failure was mostly a matter of “personal convenience.”
- Miller offered “no evidence that she ever made an offer or seriously sought to buy a house” in Virginia.
- Miller’s efforts fell short of the “exigent circumstances” needed for an extension under the federal travel regulations.
After receiving the government’s decision, Miller appealed to the CBCA for review and a final determination.
First, the CBCA outlined the government’s responsibilities when transferring an employee to a new station. Under 5 U.S.C. 5724a(d)(1), when a government employee is transferred within the United States, the government pays for the real estate transactions incurred. There is a one-year timeframe for completing these real estate transactions under 41 CFR 302-11.21.
The CBCA also noted that federal travel regulations allow for an extension of the one-year timeframe. Extensions are only allowed if “extenuating circumstances” interfered with employee’s ability to complete all real estate transactions within one year. Furthermore, the delay in completing requirements must be “reasonably related” to the employee’s PCS.
Second, the CBCA reviewed Miller’s request for an extension. The CBCA found that evidence on the record contradicted most of the government’s statements about Miller’s efforts. Miller listed her Florida condo for all of 2015-2016, except for one month. Miller decreased the price of her Florida condo three times. Miller also conducted an active search for a Virginia home, including a purchase offer that failed for code violations.
Third, the CBCA reviewed the government’s standard of review. In denying Miller’s request, the government did not find “exigent” circumstances. But as the CBCA noted, the requirement for an extension requires “extenuating” – not exigent – circumstances. As the CBCA explained, those words are not the same. Extenuating means “mitigating [or] excusing.” Whereas “exigent” means “urgent [or] critical.” Extenuating circumstances have a much lower standard than exigent circumstances.
Overall, the CBCA did not find any reasonable justification for the government’s decision. The government relied on incorrect facts and applied an incorrect standard of review. Consequently, the CBCA granted Miller’s request for a one-year extension.
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