[Federal Register Volume 62, Number 55 (Friday, March 21, 1997)]
[Rules and Regulations]
[Pages 13763-13764]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-7185]


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GENERAL SERVICES ADMINISTRATION
41 CFR Part 302-14

[FTR Amendment 61]
RIN 3090-AG22


Federal Travel Regulation; Home Marketing Incentive Payments

AGENCY: Office of Governmentwide Policy, GSA.

ACTION: Final rule.

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SUMMARY: This final rule amends the Federal Travel Regulation (FTR) to 
allow an agency to pay a home marketing incentive to a transferred 
employee who uses the agency s homesale program provided by a 
relocation services company under contract with the Government and who 
independently and aggressively markets, and finds a bona fide buyer 
for, his/her residence resulting in significantly lower fee/expense 
payments the agency must make to the relocation services company. This 
amendment will save the Government money through reduced payments to 
relocation services companies and will increase employee satisfaction 
with the relocation process.

DATES: This final rule is effective March 22, 1997, and applies to an 
employee whose effective date of transfer (date the employee reports 
for duty at the new official station) is on or after March 22, 1997.

FOR FURTHER INFORMATION CONTACT: Robert A. Clauson, Travel and 
Transportation Management Policy Division (MTT), Washington, DC 20405, 
telephone 202-501-0299.

SUPPLEMENTARY INFORMATION: A multi-agency travel reinvention task force 
was organized in August 1994 under the auspices of the Joint Financial 
Management Improvement Program (JFMIP) to reengineer Federal travel 
rules and procedures. The task force developed 25 recommended travel 
management improvements published in a JFMIP report entitled Improving 
Travel Management Governmentwide, dated December 1995. On September 23, 
1996, the President signed into law the Federal Employee Travel Reform 
Act of 1996 (Pub. L. No. 104-201), which included 8 legislative changes 
recommended by the JFMIP to improve travel and the delivery of 
relocation services.
    This amendment implements section 1717 of the Act which provides 
the General Services Administration (GSA) authority to issue 
regulations which authorize agencies to pay a home marketing incentive 
to a transferred employee to facilitate sale of the employee s 
residence at the old official station at lower overall cost to the 
Government when the employee uses the agency s homesale program 
provided by a relocation services company under contract with the 
Government. This amendment is written in the ``plain English'' style of 
regulation writing as a continuation of GSA s effort to make the FTR 
easier to understand and to use.

What is a ``homesale program''?

    A program under which a relocation services company, under contract 
with the agency, purchases a transferred employee s residence at fair 
market (appraised) value and then independently markets and sells the 
residence.

What is the ``home marketing incentive payment''?

    This is a payment an agency makes to its transferred employee to 
encourage the employee to independently and aggressively market his/her 
residence and find a bona fide buyer, thereby reducing the fee/expenses 
the agency must pay the relocation services company. The amount of the 
incentive payment may not exceed five percent of the price the 
relocation services company paid the employee for his/her residence, or 
the savings the agency realized from the reduced fee/expenses it paid.

Why would an agency want to institute a home marketing incentive 
payment program?

    With this type of program, the sum of the incentive payment and the 
reduced payment to the relocation services company is less than the 
fee/expenses the agency must pay the relocation services company when 
the company has to find a buyer for the residence.

What is the ``plain English'' style of regulation writing?

    The ``plain English'' style of regulation writing is a new, simpler 
to read and understand, question and answer regulatory format. 
Questions are in the first person and answers are in the second person. 
GSA uses a ``we'' question when referring to an agency and an ``I'' 
question when referring to the employee.

How does the plain English style of regulation writing affect 
employees?

    A question and its answer combine to establish a rule. The employee 
and the agency must follow the language contained in both the question 
and its answer.
    GSA has determined that this rule is not a significant regulatory 
action for the purposes of Executive Order 12866 of September 30, 1993. 
This final rule is not required to be published in the Federal Register 
for notice and comment. Therefore, the Regulatory Flexibility Act does 
not apply. This rule also is exempt from Congressional review 
prescribed under 5 U.S.C. 801 since it relates solely to agency 
management and personnel.

List of Subjects in 41 CFR Part 302-14

    Government employees, Travel and transportation expenses.

    For the reasons set out in the preamble, 41 CFR part 302-14 is 
added to read as follows:

PART 302-14--HOME MARKETING INCENTIVE PAYMENTS

Subpart A--Payment of Incentive to the Employee

Sec.
302-14.1  What is a ``homesale program''?
302-14.2  What is the purpose of a home marketing incentive payment?
302-14.3  Am I eligible to receive a home marketing incentive 
payment?

[[Page 13764]]

302-14.4  Must my agency pay me a home marketing incentive?
302-14.5  Under what circumstances will I receive a home marketing 
incentive payment?
302-14.6  How much may my agency pay me for a home marketing 
incentive?
302-14.7  Are there tax consequences when I receive a home marketing 
incentive payment?

Subpart B--Agency Responsibilities

302-14.100  How should we administer our home marketing incentive 
payment program?
302-14.101  What policies must we establish to govern our home 
marketing incentive payment program?
302-14.102  What factors should we consider in determining whether 
to establish a home marketing incentive payment program?
302-14.103  What factors should we consider in determining the 
amount of a home marketing incentive payment?

    Authority: 5 U.S.C. 5756.

Subpart A--Payment of Incentive to the Employee

    Note to subpart A: Use of the pronouns ``I'' and ``you'' 
throughout this subpart refers to the employee.


Sec. 302-14.1  What is a ``homesale program''?

    It is a program offered by an agency through a contractual 
arrangement with a relocation services company. The relocation services 
company purchases a transferred employee s residence at fair market 
(appraised) value and then independently markets and sells the 
residence.


Sec. 302-14.2  What is the purpose of a home marketing incentive 
payment?

    To reduce the Government s relocation costs by encouraging 
transferred employees who participate in their employing agency s 
homesale program to independently and aggressively market, and find a 
bona fide buyer for, their residence. This significantly reduces the 
fees/expenses their agencies must pay to relocation services companies 
and effectively lowers the cost of such programs.


Sec. 302-14.3  Am I eligible to receive a home marketing incentive 
payment?

    Yes, if you are an employee who is authorized to transfer and you 
otherwise meet requirements for sale of your residence at Government 
expense.


Sec. 302-14.4  Must my agency pay me a home marketing incentive?

    No. Your agency determines when it is in the Government s interest 
to offer you a home marketing incentive.


Sec. 302-14.5  Under what circumstances will I receive a home marketing 
incentive payment?

    You will receive a home marketing incentive payment when:
    (a) You enter your residence in your agency s homesale program;
    (b) You independently and aggressively market your residence;
    (c) You find a bona fide buyer for your residence as a result of 
your independent marketing efforts;
    (d) You transfer the residence to the relocation services company;
    (e) Your agency pays a reduced fee/expenses to the relocation 
services company as a result of your independent marketing efforts; and
    (f) You meet any additional conditions your agency has established, 
including but not limited to, mandatory marketing periods, list price 
guidelines, closing requirements, and residence value caps.


Sec. 302-14.6  How much may my agency pay me for a home marketing 
incentive?

    Your agency determines the amount of your home marketing incentive 
payment. The incentive payment, however, may not exceed the lesser of:
    (a) Five percent of the price the relocation services company paid 
when it purchased the residence from you; or
    (b) The savings your agency realized from the reduced fee/expenses 
it paid as a result of your finding a bona fide buyer.


Sec. 302-14.7  Are there tax consequences when I receive a home 
marketing incentive payment?

    Yes, the home marketing incentive payment is considered income. 
Consequently, you will be taxed, and your agency will withhold income 
and employment taxes, on the home marketing incentive payment. You will 
not, however, receive a withholding tax allowance (WTA) to offset the 
withholding on your home marketing incentive payment, nor will you 
receive a relocation income tax (RIT) allowance payment for 
substantially all of your Federal, state and local income taxes on the 
incentive payment.

Subpart B--Agency Responsibilities

    Note to subpart B: Use of the pronouns ``we'' and ``you'' 
throughout this subpart refers to the agency.


Sec. 302-14.100  How should we administer our home marketing incentive 
payment program?

    Your goal in using an incentive payment program is to reduce your 
overall relocation costs. You must not make a home marketing incentive 
payment that exceeds the savings you realize from the reduced fees/
expenses you pay the relocation services company.


Sec. 302-14.101  What policies must we establish to govern our home 
marketing incentive payment program?

    You must establish policies to govern:
    (a) The conditions under which you will authorize a home marketing 
incentive payment for an employee;
    (b) The amount of the home marketing incentive payment(s) you will 
offer (or the method you will use to compute your home marketing 
incentive payments); and
    (c) Who will determine in each case whether a home marketing 
incentive payment is authorized.


Sec. 302-14.102  What factors should we consider in determining whether 
to establish a home marketing incentive payment program?

    You should consider:
    (a) Whether the program will increase the percentage of residences 
sold for which employees find a bona fide buyer. You should establish a 
benchmark for the percentage of residences for which you expect 
employees to find a bona fide buyer resulting in lower homesale costs 
to you. If your historical percentage of employee-generated sales is 
below your benchmark, a home marketing incentive payment program may 
benefit you.
    (b) The expected net savings from a home marketing incentive 
payment program.


Sec. 302-14.103  What factors should we consider in determining the 
amount of a home marketing incentive payment?

    You should consider:
    (a) Amount of savings from reduced fee/expenses paid to the 
relocation services company. The home marketing incentive payment 
program is intended to reduce your relocation costs. The amount of each 
home marketing incentive payment you make, therefore, must not exceed 
the savings you realize from the reduced fee you pay to the relocation 
services company.
    (b) Employee's efforts in marketing the residence. The purpose of a 
home marketing incentive payment program is to encourage a transferred 
employee who participates in a homesale program to independently and 
aggressively market his/her residence and find a bona fide buyer.

    Dated: March 17, 1997.
Thurman M. Davis, Sr.,
Acting Administrator of General Services.
[FR Doc. 97-7185 Filed 3-20-97; 8:45 am]
BILLING CODE 6820-34-P