Payment of Fees for Actuarial Accreditation Examination Review, B-286026, June 12, 2001

B-286026 Jun 12, 2001 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Background PBGC is a wholly-owned government corporation. A person must have an undergraduate degree or a combination of relevant education and experience. An actuary need not have a professional license or credential for employment. "focus on a number of realistic actuarial problems that mirror the problems that PBGC's actuaries will face as they advance in their careers.". That having actuaries who sit for the exam and obtain actuary credentials will enhance PBGC's credibility when dealing with actuaries hired by participants and sponsors who challenge PBGC's decisions. PBGC also has determined that offering actuarial training and examinations at government expense will assist in recruiting and retaining actuaries. View Decision Payment of Fees for Actuarial Accreditation Examination Review, B-286026, June 12, 2001   DIGEST   DECISION By letter dated August 2, 2000, the General Counsel of the Pension Benefit Guaranty Corporation (PBGC) asked whether PBGC may use appropriated funds to pay, as training costs, fees for actuary accreditation examination review courses, on-the-job study time, and examination fees. As explained below, PBGC has authority, under 5 U.S.C. Sec. 4109(a), to use appropriated funds for review courses and on-the-job study time, but not for examination fees. Background PBGC is a wholly-owned government corporation, 5 U.S.C. Sec. 105, that administers the defined-benefit termination insurance program under Title IV of the Employee Retirement Income Security Act of 1974, 29 U.S.C. Secs. 1301 - 1368. When a covered pension plan terminates with unfunded benefit liabilities, PBGC takes over the plan and pays the unfunded portion of the basic benefits with its insurance funds. 29 U.S.C. Sec. 1322. PBGC employs a number of actuaries to calculate pension benefits. To obtain employment as an actuary at PBGC, a person must have an undergraduate degree or a combination of relevant education and experience; an actuary need not have a professional license or credential for employment. Letter from PBGC General Counsel, August 2, 2000. Two organizations, the Joint Board for the Enrollment of Actuaries and the Society of Actuaries, offer examinations to accredit actuaries. In the course of negotiating a collective bargaining agreement with its actuaries, PBGC proposes to use its training funds to pay to send actuaries to examination review courses, provide actuaries with on-the-job study time to review the course materials, and pay for the accreditation examinations. PBGC explained that because pension plan participants and sponsors often challenge PBGC's benefit-calculation decisions (sometimes in litigation), the review courses, even though designed to prepare examinants for the exams, would enhance the ability of PBGC actuaries to carry out their assignments. These courses, PBGC has determined, "focus on a number of realistic actuarial problems that mirror the problems that PBGC's actuaries will face as they advance in their careers." PBGC Letter, August 2, 2000. PBGC expects, further, that having actuaries who sit for the exam and obtain actuary credentials will enhance PBGC's credibility when dealing with actuaries hired by participants and sponsors who challenge PBGC's decisions. PBGC also has determined that offering actuarial training and examinations at government expense will assist in recruiting and retaining actuaries. Recruitment and retention problems have been exacerbated in recent times by the high salaries that actuaries command in the private sector. Analysis At issue here is whether the cost of the examination review courses, on-the-job study time, and accreditation exams are properly viewed as personal qualification expenses or as training expenses. As early as 1890, the Supreme Court held that expenses necessary to qualify a government employee to do his or her job are personal expenses, and as such, are not chargeable to appropriated funds. "[I]t is the duty of persons receiving appointments from the government . . . to qualify themselves for the office." United States v. Duzee, 140 U.S. 169, 171 (1890). The accounting officers of the government have adhered to this rule. /1/ As stated in an 1895 Comptroller of the Treasury decision, "That which is required of a person to become invested with an office must be done at his own expense unless specific provision is made by law for payment by the Government." 2 Comp. Dec. 262, 263 (1895). Our decisions have applied this rule on numerous occasions. In 61 Comp. Gen. 357 (1982), for example, we held that an agency could not pay the costs of bar review courses or bar membership fees for its employee attorneys. We viewed these expenses as personal expenses related to qualifying for office. See also 46 Comp. Gen. 695 (1976) (medical licensing fees for Public Health Service physicians); 22 Comp. Gen.