Reimbursement of Certain Expenses From a Private Corporation Under Contract With the Peace Corps

Published by the Government Accountability Office on 1971-04-16.

Below is a raw (and likely hideous) rendition of the original report. (PDF)


                       f!J -G-
     Dear    Senator      Bayh:

              We have completed             the review         requested     in your letter
     of February          17, 1971, with which you forwarded                       correspondence
     from Mr. Albert          Hargreaves            relative      to his problem         in obtain-
     ing reimbursement ____=__,  of     certain
                                 _ .-..=,.               expenses
                                        . .-_ __ .--...s-- -.         frsm a   private      corpora-
     tion     ~Ynde~~>~~&cJ~~~&h               ~~~a~;e.,Corp.s~:;_....        - $$-:
\       --A--=+~---~-'-*- -.
              Although     the claim    for monies     due would appear    to be
     properly       a matter     for resolution     between the employee,
     Mr. Hargreaves,          and the employer,      the Development     and Resources
     Corporation,       we did look into        the situation    in order    to provide
     data for a reply          to your constituent.

2/            The Development        and Resources        Corporation          is under contract          p/qr,7
     with the Peace Corps to provide                 professional          training     and techni-                .
     cal support         services    to Peace Corps staff             and volunteers          for
     agricultural         and rural     development       programs       in countries         in the
     North      Africa,     Near East and South Asia Region                  as specifically
     requested         by the Peace Corps.          These services           are principally
     performed         by qualified     technical      specialists         hired     by the Con-
     tractor       on a short-term        basis   to provide        the technical          expertise
     necessary         to accomplish      the program       objectives.           The Contractor
     directs       the work of the technical            specialists          and provides
     professional          guidance    and administrative           support.

             To staff     an in-country        training       program       under this        contract,
     Mr. Albert       Hargreaves      was employed         by the Development              and
     Resources      Corporation       on September         23, 1970, to perform               services
     in connection        with the Maharashtra             Small    Industries         Program       in
     India.      The short-term         employment       agreement       executed        between
     Mr. Hargreaves         and the Contractor           provided      initially         for partici-
     pation    in a 3-week pretraining               session     in India        and subsequently
     to serve as Project           Director      of the Maharashtra              Small     Industries
     Program     during     the period      from approximately              November       14, 1970
     through     February      13, 1971.

                             50 TH ANNIVERSARY              1921-       1971

       The Project          Director       is responsible        for the overall    training
program,       including       its administration            as well as content,      and as
such must assure that                the various        components    such as language,
cross-cultural           and technical          studies    are integrated    so that      a
meaningful         program     will     result.

         Mr. Hargreaves      arrived      in India     on October      9, 1970, to
attend      the pretraining       session.       During   this    orientation      period,
Peace Corps'       records    show that      it was determined           that   Mr. Hargreaves
did not prequalify          as Project      Director     of the Maharashtra         Small
Industries      Program     and would not be asked to conduct                 that program
for the Peace Corps.

       Subsequent        to Mr. Hargreaves'             return      to the United        States,
he submitted        a claim     to the Development              and Resources         Corporation
for reimbursement           of expenses       incurred         during     the trip     to India
to participate         in the pretraining             session.         This claim,       which
was primarily        for costs of hotels,               food and taxi          fares,    was
apparently       submitted      on the basis          that     actual     subsistence       expenses
would be reimbursed            up to $35 a day, provided                  that    the expenses
were supported         by receipts        or certifications,              as set forth        in
Development       and Resources          Corporation's           "Notes     on Travel      and
Business      Expense      Regulations."

        Upon submission       of the expense        report,        the Contractor      took
exception       to Mr. Hargreaves'      claim    of about $22 a day on the
jlasis    that    it exceeded   the per diem rates             established      by the
Peace Corps contract.           In this     respect,       Article       XIV of the contract
states,       in part:

               "D.     Per diem should     be computed       and
                billed    in accordance      with Section       925
                of the Standardized        Regulations       (Govern-
                ment Civilians,      Foreign     Areas)    except
                as modified     by the provision        of the
                Peace Corps Manual,        Section     811."

        The referenced       Peace Corps Manual establishes                   various    rates,
by location,       which range from $7 to $13 a day in India.                         Based
on these     varying    rates     of per diem,           plus other     exceptions,      the
Development       and Resources         Corporation         allowed    Mr. Hargreaves
reimbursable       expenses     totalling          $259.53.       Since Mr. Hargreaves
had been advanced         $302.63,        application        of these expenses        resulted
in an outstanding         advance       of $43.10.

            It appears that Mr. Hargreaves was.not aware of the sub-
     sistence rates in India as imposed on the Development and
     Resources Corporation    under the terms of the contract with the
     Peace Corps and was not pleased with the exceptions      taken to
     his travel   claim.   It is to be noted, however, that Mr. Hargreaves'
     employment agreement did not specifically     provide for the reim-
     bursement of subsistence    expenses during his assignment to India
     nor did it set forth a specific     rate that could be claimed.

           During the course of our review, we were advised by a Peace
     Corps' contracting    official    that on March 2, 1971, Mr. Hargreaves
     and the Development and Resources Corporation           had reached an
     agreement whereby he was granted a sum equivalent           to three days
     severance pay less the advance outstanding          and federal   payroll
     deductions.     Final settlement,     we were informed,    was made to
     Mr. Hargreaves on March 3, 1971.

             With respect to Mr. Hargreaves'           comments regarding        the method
     by which the Development and Resources Corporation                    employs the
     necessary technical       specialists    to fulfill      its contract with the
     Peace Corps, our review noted no contractual                provisions     which would   .
     preclude the Contractor        from hiring     individuals      as short-term
     employees in lieu of consultants.             Consideration       will be given to
     the relative     merit and financial       effect    of t3e various methcds
     utilized    by contractors     in obtaining      personnel     on a short-term
     b,zsis during our current review at the Peace Corps which involves
     certain aspects of contracting         policies      and procedures.

             In accordance with your request, we are returning   the original
     letter.     If you have any questions relative to this review,   we
     will be pleased to discuss them with you or your staff.

                                            Sincerely   yours,

                           AsslaWt          Comptroller  General
                                            of the United States

61 Jii-
     The Honorable     Birch Bayh
     United States     Senate