DEAR MR. DULLES:

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-01370R000100090001-1
• Release Decision: RIFPUB
• Original Classification: C
• Document Page Count: 3
• Document Creation Date: December 9, 2016
• Document Release Date: July 24, 2000
• Sequence Number: 1
• Publication Date: August 31, 1960
• Content Type: LETTER

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DDS
COMPTROLLER GENERAL OF THE UNITED STATES
Washington 25
B-143722
Mr. Allen W. Dulles, Director
Central Intelligence Agency
August 31, 1960
On August 4, 1960, you requested our decision concerning the
propriety of a proposed regulation under which certain employees,
upon their separation from the Central Intelligence Agency, would
be granted separation compensation.
The monetary benefits provided under the proposed regulation
would be payable only to those employees of the Central Intelligence
Agency who are separated as surplus and whose previous experience in
the Agency consisted of such highly specialized and unique activities
as to hamper seriously their opportunity for employment elsewhere.
You say that the regulation will not benefit any employee who is
separated for cause or whose employment is terminated under the Agency's
Selection Out Program or who voluntarily retires. You consider that
the program contemplated under the proposed regulation not only would
be equitable to employees who may be separated as surplus but is
necessary in connection with the recruitment of new career employees.
Your concluding paragraph is to the effect that the program contemplated
under the proposed regulation is urgently needed to enable your Agency
to carry out its function under an efficient and effective personnel
management program.
In general, under the proposed regulation the amount of separation
compensation would vary in individual cases depending upon the salary
rate of the employee and the length of continuous service (up to 12
years) with the Agency. In no event could the total amount payable
exceed twelve months' basic salary at the rate the individual was re-
ceiving immediately prior to separation or at the highest scheduled
rate of grade GS-l4, whichever is less. The statutory authority under
which the regulation would be issued is that appearing in section 8
(formerly section 10) of the Central Intelligence Agency Act of 1949,
as amended, 50 U.S.C. 403j, on the ground that the Agency is imposing
new conditions of employment on its personnel which warrant additional
compensation. The regulation would apply prospectively to separations
within their scope. Cf. 31 Comp. Gen. 191. The cited section is in ftomaft
pertinent part as follows : *a Qpm- or as ri
" to at *mom I& dow
demo* kamom to so cv-
10 IM
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B-143722
"(a) Notwithstanding any other provisions of law,
sums made available to the Agency by appropriation or
otherwise may be expended for purposes necessary to
carry out its functions, including--
(1) personal services, including personal
services without regard to limitations
on types of persons to be employed * * *
"(b) The sums made available to the Agency may be
expended without regard to the provisions of law and
regulations relating to the expenditure of Government
funds***,'"
We note that many of the purposes for which Agency funds may be
expended "notwithstanding any other provisions of law" are specifically
enumerated in subsection (a) which enumeration includes "personal
services." The question arises, therefore, whether expenditures for
"personal services" properly may include separation
which under the proposed regulation would continue to be made after
the personal service relationship between the Agency and the employee
is terminated. While the matter is not entirely free from doubt, we
think that separation compensation reasonably may be viewed as a type
of deferred compensation which, under your regulation, would be earned
as an employee but would be payable at and after his separation. Such
compensation would be based upon continued performance, over a period
of years, of an unusual type of service and the amount to which any
individual would be entitled would be in direct proportion--subject
to the maximum limitation--to the length of Agency service rendered.
There is no doubt concerning your authority to fix compensation and
viewing the payments provided for under the proposed regulation as
compensation, we think that it is reasonable to conclude that they
constitute expenditures for "personal services" as that term is used
in section 8(a).
It is noteworthy, however, that the enumeration of purposes in
section 9(a) for which sums may be expended "notwithstanding any
other provisions of law" is not exclusive. The section contemplates
that your Agency may make additional expenditures (other than for the
enumerated purposes) "for purposes necessary to carry out itsthout
functions" and under subsection (b) expenditures may be made "without
regard to provisions of law and regulations reelaatiingg tostheoexpene tur
re-
of Government funds." Hence, even if separation
services", such
garded as an expenditure for other than
permitted by the statute,
expenditure reasonably might be regarded as
provided it was "necessary to carry out" the functions of your Agency.
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B-143722
Having regard for the necessity of separating "as surplus"
certain career personnel in your Agency after comparatively short
periods of service, the probable difficulty these employees may
encounter in effecting transfers to other positions or finding other
suitable employment after their separation from your Agency, and the
difficulty your Agency expects to experience in the recruitment of
required numbers of career personnel for certain types of positions,
the expenditures for separation compensation reasonably may be viewed
as expenditures "for purposes necessary to carry out" the functions
of your Agency whether such separation compensation be regarded as an
expenditure for "personal services" or otherwise.
Therefore, we would have no objection to your promulgating a
regulation along the lines proposed. We note, however, that the proposed
regulation does not expressly cover a situation in which death of an
individual entitled to separation compensation occurs prior to his re-
ceipt of the full amount of separation compensation otherwise payable.
While we presume it is intended that death would extinguish all rights
to separation compensation that was not payable prior to the date
thereof, it would be preferable if your regulation would clarify the
matter.
It is noted from your letter of August 4, 1960, that appropriate
committees of the Congress have been informed of the proposed regula-
tion. While, as stated above, we are of the opinion that legal
authority exists for the granting of separation compensation to
certain employees of the Central Intelligence Agency, we suggest that
the regulation not be issued until such time as any questions raised
by the congressional committees to whom the plan has been submitted
are resolved.
/s/ R. F. Keller
Acting Comptroller General
of the United States
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