[Letter], B-279095.2, June 16, 1998

B-279095.2 Jun 16, 1998 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights There is no legal basis for the D.C. Financial Responsibility and Management Assistance Authority (Authority) to have made regular salary payments to its staff at rates exceeding the rate of basic pay for Executive Level IV. The concept of locality pay does not have meaning in view of the Authority's pay scheme and the Authority did not include a locality pay component in its pay system in any systemic fashion. 2. There is no legal basis for the D.C. Financial Responsibility and Management Assistance Authority (Authority) to have made regular salary payments to its staff at rates exceeding the rate of basic pay for Executive Level IV. The Executive Schedule pay rates to which section 102 of the Act refers are established pursuant to 5 U.S.C. chapter 53. View Decision B-279095.2 June 16, 1998 DIGESTS 1. There is no legal basis for the D.C. Financial Responsibility and Management Assistance Authority (Authority) to have made regular salary payments to its staff at rates exceeding the rate of basic pay for Executive Level IV. Section 102 of Public Law 104-8 establishes the rate of basic pay for level IV as the maximum rate of pay for the Authority's staff. Neither section 102 nor its legislative history supports the Authority's view that it may exceed the level IV rate limitation by characterizing the excees pay to three of its staff as locality pay. Further, while the Authority analogizes to locality pay in the federal system, the concept of locality pay does not have meaning in view of the Authority's pay scheme and the Authority did not include a locality pay component in its pay system in any systemic fashion. 2. There is no legal basis for the D.C. Financial Responsibility and Management Assistance Authority (Authority) to have made regular salary payments to its staff at rates exceeding the rate of basic pay for Executive Level IV. Section 102 of Public Law 104-8 establishes the rate of basic pay for level IV as the maximum rate of pay for the Authority's staff. Neither the D.C. Management Reform Act of 1997, nor its legislative history, supports the Authority's view that it may infer from the Act,or the circumstances surrounding its enactment and implementation, the legal authority to pay a Chief Management Officer in excess of Executive Level IV. Further, the Authority's view that the level IV limitation does not apply to a Chief Management Officer appointed by the Authority Chair, rather than by the the Authority's Executive Director, would render the pay limitation meaningless contrary to the Congress' purpose in enacting section 102. The Honorable Charles H. Taylor Chairman, Subcommittee on District of Columbia Committee on Appropriations House of Representatives Dear Mr. Chairman: This responds to your letter dated April 7, 1998, asking whether the District of Columbia Financial Responsibility and Management Assistance Authority (the Authority) has complied with the limitation provided in section 102 of the District of Columbia Financial Responsibility and Management Assistance Act of 1995 (the Act), Pub. L. No. 104-8, 109 Stat. 97 (1995), in paying the Authority's staff. You asked that we consider all Authority staff who received pay for any period from the Authority's inception through March 31, 1998. We requested information from the Authority concerning its staff compensation, held several meetings with Authority staff, and reviewed personnel and pay records of a number of Authority employees. As explained in detail in the attachments to this letter, we conclude that for some or all of the period in question, the Authority has paid four of its staff members at rates exceeding the pay limitation established by section 102. Section 101(a) of the Act establishes the Authority as an entity within the government of the District of Columbia, and not as a department, agency, establishment, or instrumentality of the United States government. The Authority consists of five members appointed by the President who serve without pay, one of whom the President designates to serve as Chair. Sections 102(b) and (d) of the Act. The Act provides that the Authority shall adopt by-laws, rules, and procedures governing its activities, including procedures for hiring experts and consultants. Section 102(e). The Act provides that the Chair with the consent of the Authority shall appoint an Executive Director, who "shall be paid at a rate determined by the Authority, except that such rate may not exceed the rate of basic pay payable for level IV of the Executive Schedule." Section 102(a) (emphasis added).