Bonneville Power Administration's Claim for Reimbursement in Connection with Land Transfer

• Court: Department of Justice Office of Legal Counsel
• Decided: March 2, 1982
• Status: Published

Opinion

Bonneville Power Administration’s Claim for Reimbursement in Connection with Land Transfer

U nder the Federal P roperty and A dm inistrative Services Act of 1949, the Bonneville Power Adm in­ istration is entitled to be reim bursed the fair value o f certain property that it transferred to the Secretary o f the Interior for the use and benefit o f the Puyallup Indian Tribe, without regard to w hether said property is located w ithin the Puyallup Indian Reservation.

U nder the Federal P roperty and Adm inistrative Services A ct of 1949, fair value reim bursem ent to the transferor agency by the acquiring agency is m andatory in all cases where the property was acquired w ith funds from a revolving fund, 40 U .S .C . §§ 483(a)(1), 485(c). The General Services A dm inistration has no discretion to w aive such a repaym ent obligation by the acquinng agency, even w here, as is arguably the case h ere, the acquiring agency is under an independent statutory obligation to acquire the land.

March 2, 1982

MEMORANDUM OPINION FOR THE ASSISTANT GENERAL COUNSEL, DEPARTMENT OF ENERGY

This responds to your request for our opinion on a matter in dispute between the Bonneville Power Administration (Bonneville) and the General Services Administration (GSA) relating to Bonneville’s claim for reimbursement in con­ nection with its transfer to the Secretary of the Interior of certain real property under the Federal Property and Administrative Services Act of 1949, 40 U.S.C. § 471—75 (1976 & Supp. IV 1980) (the Act).1 At issue is whether Bonneville is entitled to be reimbursed the fair value of the property which the Secretary of the Interior has taken in trust for the Puyallup Tribe of Indians. We conclude that it is so entitled. According to the information you provided us, the property in question consists of 1.34 acres of land in Pierce County, Washington, purchased some years ago for the United States by Bonneville from private parties with funds appropriated from the Treasury. The Treasury has since been reimbursed the purchase price from revenues generated by Bonneville’s sale of electric power. As a practical matter, then, the land has been paid for by Bonneville’s customers. Recently, Bonneville determined that it no longer had any need for the property,

] A s you know , we solicited th e views of b o th the D epartm ent o f th e Interior and the D epartm ent of Energy on the q uestions p resen ted by B onneville. The form er agency was in substantial ag reem en t w ith G S A 's interpretation o f the A ct. We also received an unsolicited subm ission from the attorney for the Puyallup N ation o f Indians discussing a second issue raised by B onneville— the contin u in g existence o f the P uyallup Indian R eservation w ithin w hose b oundaries the p ro p erty in question is purported to be located. See note 4 , infra.

172 and so reported to GSA.2 GSA then sought to ascertain, as required under § 483(a)(1) of the Act,3 whether any other federal entity was interested in acquiring the property. Subsequently, at the request of the Puyallup Indian Tribe, the Bureau of Indian Affairs of the Department of the Interior certified to GSA that the property was located within the reservation boundaries of the Puyallup Tribe, and requested that the land be transferred to the Secretary of the Interior to be held in trust by him for the benefit and use of the tribe, as required by § 483(a)(2) of the Act. Bonneville takes the position that under §§ 483(a)( 1) and 485(c) of the Act it is entitled to be reimbursed the fair value of the property. GSA does not dispute that Bonneville would ordinarily be entitled to fair value reimbursement by an agency acquiring the property under the above-mentioned provisions of the Act. Rather, GSA contends that no reimbursement is required because the land is located within an Indian reservation, is therefore subject to the terms of § 483(a)(2), and consequently its transfer generates no proceeds from which reimbursement would be possible. The Department of the Interior appears to be in essential agreement with GSA on this point of statutory construction.4

I.

Section 483(a)(1) of the Act provides for the transfer among federal agencies of “ excess” property,5 and reads in pertinent part as follows: Subject to the provisions of paragraph (2) of this subsection, in order to minimize expenditures for property, the Administrator

2 U nder 16 U .S C § 832a(e) (1976) B onneville w ould appear to have its ow n authority, in dependent of G S A , to sell o r otherw ise dispose of real p roperty ow ned by it, provided that it obtains the p n o r approval o f the President for the particular transaction It is not clear to us w hy Bonneville chose in this case to dispose o f the property th ro u g h G S A , an d thereby necessarily in accordance w ith the procedures m andated by the A ct, rather than sim ply sell it on the op en m arket. We note, however, that the decision to dispose o f the property through G SA facilitates its tra n sfer into tru st for the P uyallup Tribe. 3 R elevant sections o f the A ct w ill be identified in this opinion by citation to Title 4 0 o f the U n ited States C o d e. T hus § 202(a)(1) o f the Act w ill be cited as § 483(a)(1), § 204(c) as § 485(c), etc 4 B onneville argues in the alternative that the parcel of excess land in question is not currently located “ w ith in ” an Indian reservation, and that its transfer is therefore not governed by § 483(a)(2) In support o f this p o sitio n , B onneville cites several recent S uprem e C ourt cases w hich, in its view, cast do u b t upon the co n tin u ed existence o f the Puyallup R eservation G SA d efers to the determ ination of the Interior D epartm ent on the q u estio n o f the location o f th e property w ithin an Lndian reservation, and its concom itant eligibility for tran sfer pursuant to § 483(a)(2) T h e D epartm ent of the Interior urges that the holding o f the Court of A ppeals in United States v State c f Washington, 4 9 6 F 2 d 6 2 0 (9th Cir. 1974), cert, denied, 419 U S 1032 (1975) be considered conclusive o f the issue of the co n tin u ed existence of the P uyallup Reservation. We ag ree with the D epartm ent o f the Interior that it w ould be inappropriate, in light o f the U nited States’ fiduciary obligations as trustee for the Indians, to reopen th e question o f the reservation’s status in this context We are m indful, in this reg ard , o f the governm ent’s longstanding litigating position on the issue See . e.g , City c f Tacoma v Andrus, 457 F Supp. 342 (D D .C . 1978) (S ecretary of Interior acted w ithin his pow er under 25 U .S .C . § 4 6 5 (1976) in acquiring trust lands w ithin historic b oundanes of Puyallup R eservation) In any ev en t, because o u r conclusion with respect to B onneville’s entitlem ent to reim bursem ent under th e A ct does not depend upon the location o f the property, we need not address the considerations raised by B onneville with respect to the co n tin u ed existence o f the reservation 5 “ Excess p ro p erty ” is defined in § 472(e) o f the A ct of “ any property under the control o f any Federal ag en cy which is not required for its needs and the discharge o f its responsibilities, as determ in ed by the head thereof.” It is distinguished from " su rp lu s p ro p erty ,” w hich is defined in § 472(g) as "an y excess property not required for the needs an d the discharge of the responsibilities o f all Federal agencies, as d eterm ined by the A dm inistrator [of G S A l”

173 shall prescribe policies and methods to promote the maximum utilization of excess property by executive agencies, and he shall provide for the transfer of excess property among Federal agen­ cies and to the organizations specified in section 756(f) of this title. The Administrator, with the approval of the Director of the Office of Management and Budget, shall prescribe the extent of reimbursement for such transfers of excess property: Provided, That reimbursement shall be required cf the fair value, as deter­ mined by the Administrator, cf any excess property transferred whenever net proceeds are requested pursuant to section 485(c) cf this title or whenever either the transferor or the transferee agency (or the organizational unit affected) is subject to the Government Corporation Control Act (59 Stat. 597; 31 U.S.C. 841) or is an organization specified in section 756(f) of this title . . . .

(Emphasis added.) By the terms of this section, the Administrator of General Services has some discretion in determining the extent to which an agency accepting transfer of excess property must “ reimburse” the Treasury for its acquisition. However, “ fair value” reimbursement “ shall be required” from an acquiring agency “ whenever net proceeds are requested pursuant to section 485(c) of this title.” This latter section deals with the situation in which excess property was originally acquired by the transferor agency “ by the use of funds either not appropriated from the general fund of the Treasury or appropriated therefrom but by law reimbursable from assessment, tax, or other revenue or receipts. . . .’’ In such a case, and upon the request of the transferor agency, the proceeds of the transfer “ shall be credited to the reimbursable fund or appropria­ tion or paid to the Federal agency which determined such property to be excess. . ; In other words, “ fair value” reimbursement to the transferor agency by the acquiring agency is mandatory under § 483(a)(1) whenever the property was acquired by the transferor agency with funds from a so-called “ revolving fund.” 6

6 A s o rig in ally en a cted , § 483 of the A ct req u ired fair value reim b u rsem en t b y the acquiring agency in all excess p ro p e rty tra n sfers See § 202(e) o f the A ct o f June 30, 1949, ch 28 8 , 63 Stat. 385 A m endm ents to the A ct in 1952 gave th e A dm inistrator o f G eneral Services discretion to w aive this reim bursem ent requirem ent in all but a few s itu a tio n s. See A c t o f July 12, 1952, ch 70 3 , 66 Stat. 593 T he S enate R eport explained the need fo r the am en d m en ts as follow s

The pu rp o se of this provision o f th e bill . . is to p erm it better u tilizatio n o f excess property by o th e r F ederal agencies which have n ee d for such property. Experience h as clearly dem onstrated that a co n sid e rab le am ount o f excess p ro p erty w hich has b een reported to the G SA for red istribution to o th e r F ederal agencies cannot under existing authority b e transferred to the needing ag en cies, since reim b u rsem en t is req u ired under the “ fair value” provision o f section 202 o f the Federal Property and A dm inistrative S ervices Act of 1949, as am ended. T h e needing agencies contend that they have no fu n d s available fo r reimbursing the owning agency, and GSA does not have authority to transfer without reimbursement, and as a re su lt the best utilization o f excess p roperty is not attained. This am en d m en t to th e act w ould liberalize the effect of the statute and at th e sam e tim e provide a more flexible m ethod for tra n sfer so that g reater utilization o f excess p roperty could be attained, w hile at the sam e tim e retaining existing ex c ep tio n s specifically authorized by law.

S .R e p N o 2 0 7 5 ,82d C o n g ., 2d Sess 3 ( 1 9 5 2 )( e m p h a s is s u p p lie d ).O n e o f th e “ existin g ex cep tio n s” re fe rre d to in th e above passage is the situation in w hich " n e t proceeds are requested p u rsu an t to § 485[c] ”

174 The regulations implementing GSA’s responsibilities under § 483(a)(1) are found in Subpart 101-47.2 of Title 41 of the Code of Federal Regulations. Reimbursement for transfers of excess real property is prescribed in 41 C.F.R. 101-47.203-7(f). Subsection (f)( 1) mandates fair value reimbursement where the transferor agency requests the “ net proceeds” of a transfer under § 485(c) of the Act; subsection (f)(2) prescribes in some detail procedures governing reimburse­ ment “ in all other transfers of excess real property.” Briefly, GSA may or may not require reimbursement from an acquiring agency under (f)(2), depending upon whether the agency has available appropriated funds to spend on the acquisition, or whether Congress has specifically authorized the transfer without reimburse­ ment.7 In accordance with the mandate of the statute, the regulations embody no analogous waiver authority where § 485(c) property is involved.

II.

Bonneville contends, and GSA does not dispute, that the property in question here falls within the scope of § 485(c). Although initially the funds used to purchase the property were appropriated from the Treasury, the Treasury is being reimbursed through revenues generated from the sale and transmission of electric energy generated at the Bonneville project. See 16 U.S.C. § 832j. Bonneville would therefore appear to be entitled to fair value reimbursement from the agency to which its excess property is transferred, both under § 483(a)(1) of the Act and under GSA’s implementing regulations. In this case, however, GSA argues that under 1975 amendments to the Act dealing with excess property located within Indian reservations, Bonneville is not entitled to reimbursement. These amendments make § 483(a)(1) expressly “ subject to” a new § 483(a)(2), which requires GSA to transfer any excess property located within an Indian reservation to the Secretary of the Interior to be held in trust for the tribe. See Act of Jan. 2, 1975, Pub. L. No. 93-599, 88 Stat. 1954. The subsection reads in pertinent part as follows: The Administrator shall prescribe such procedures as may be necessary in order to transfer without compensation to the Secre­ tary of the Interior excess real property located within the reserva­ tion of any group, band, or tribe of Indians which is recognized as eligible for services by the Bureau of Indian Affairs. Such excess real property shall be held in trust by the Secretary for the benefit and use of the group, band, or tribe of Indians, within whose reservation such excess real property is located. . . . (Emphasis added.)

7 Exam ples o f situations m w hich Congress has specifically authorized the transfer o f property w ith o u t reim b u rse­ m ent are found in 1 6 U .S C § 667b (transfer o f real p roperty for w ildlife conservation purposes to state agencies or D epartm ent of the Interior), 50 U S .C A pp. § 1622(g) (conveyance of real property to state or local governm ent for public airports); 4 0 U S .C . § 484(k)(3) (conveyance of real property to state o r local governm ents for use as historic m onum ent). However, as we read G S A ’s regulations, the reim bursem ent obligation may be excused only in situations w here § 4 8 5 (c) does not apply T hus the general obligation to reim burse a revolving fund un d er (f)( I ) will always prevail over any defense to a reim bursem ent obligation set o u t in (0 (2 ).

175 GSA’s position, with which Interior is in essential agreement, is based on a reading of the above provision in which the phrase “ without compensation” modifies the word “ transfer.” The transaction contemplated by (a)(2) is thus characterized as a “ transfer without compensation.” From this characterization GSA argues that a § 483(a)(2) transfer generates no proceeds which could be credited to Bonneville’s revolving fund. If GSA’s reading of the language of subsection (a)(2) is correct, the fair value reimbursement requirement contained in subsection (a)( 1) will never be realized in a transfer of land located within an Indian reservation. Thus, subsection (a)(2) would qualify subsection (a)(1) in not one but two respects: it would limit the GSA Administrator’s discretion under (a)(1) with respect to which agency is entitled to the excess property, and also impliedly repeal that section’s fair value reimbursement requirement for self-financing agencies like Bonneville. We hesitate to give the provision such a broad effect without the clearest expression of congressional intent, particularly since in certain circumstances it could raise constitutional issues. See note 10, infra. We look, therefore, to a possible alternative reading of the language of subsection (a)(2): a transfer governed by this section is to be effected “ without compensation to the Secretary of the Interior.” Certainly, this is a reasonable alternative reading of somewhat ambigu­ ous phraseology— phraseology whose ambiguity is compounded by the use of the word “ compensation” instead of the term generally used in this statute, “ reimbursement.” 8 Because the language which Congress chose admits of more than one reason­ able construction, we turn to the legislative history to ascertain what relationship Congress intended the new section to have to other parts of the Act, and in particular to § 483(a)(1) itself.9 There we find strong support for the alternative reading we have suggested, and none for GSA’s.

III.

Public Law No. 93-599 was enacted in 1975 principally to curtail the discre­ tion which both the Administrator of General Services and the Secretary of the Interior then enjoyed under the Act in connection with the disposition of excess property located within an Indian reservation. Under the law as it then existed, a tribe’s ability to benefit from the use of excess federal property on its reservation was entirely dependent upon the willingness of the Secretary of the Interior to

8 H ad C o n g ress intended to preclude an o w n in g agency’s being reim bursed in any circum stances by the S ecretary o f the Interior u n d er § 4 83(a)(2), it m ight have stated clearly that excess property located w ithin an Indian reservation should be “ tra n sferre d to the S ecretary of the Interior w ithout com pensation to the owning agency A lternatively, the statute could have referred to “ transfer w ithout reim bursem ent to the tra n sfero r’’ w h ich w ould have been consistent w ith th e language and s tru ctu re of (a)(2). W hile speculation regarding w hat C ongress m ight have said is not p articu larly u sefu l, its d ep a rtu re from the m ore obvious ch o ices leads o ne to an inquiry into the legislative history to see if there is any exp lan atio n for the w ords it d id select. g R eferences to the legislative history may b e appropriate even w here a statu te's meaning appears plain on its face, p articularly w here ap p a re n tly contradictory d ire ctiv es are given by m ore than o n e applicable provision o f law. See Watt v. Alaska, 451 U .S . 2 5 9 (1981). See also Train v. Colorado Public Interest Research Group, Inc., 4 2 6 U S 1, 10 (1976)

176 apply to GSA for its transfer, and GSA’s willingness to choose Interior over some other agency interested in acquiring the land. The 1975 amendments to the Act were intended to make mandatory GSA’s transfer of excess property located within a reservation to the Secretary of the Interior, to be held in trust “ for such use as the Indian tribe located on the reservation believes best.” See H.R. Rep. No. 1339,93d Cong., 2d Sess. 4 (1974) (House Report). Neither the terms of the statute nor its legislative history suggest that Congress intended there to be any exceptions to this requirement, or that any discretion was to remain in either GSA or the Secretary once the land was determined to be located “ within [a] reservation.” As originally introduced in the House, and reported out of Committee in the Senate, the legislation authorized the Secretary of the Interior under certain limited circumstances to require reimbursement from an Indian tribe when excess property located within a reservation was transferred to Interior in trust for the tribe. See House Report at 2; Disposal of Excess Property Located within Indian Reservations: Hearing on H.R. 8958 Before a Subcomm. of the House Comm, on Government Operations, 93d Cong., 2d Sess. 3 (1974). Specifically, H.R. 8958, 93d Cong., 1st Sess. (1973) authorized the Secretary to require reimbursement “ in the event that the group, band, or tribe of Indians receiving excess property under this section was compensated for such real property when title was acquired by the United States.” This limited authority was stricken by the House Committee, however, with the following comments:

Amendment two provides that excess property shall be trans­ ferred to the Interior Department for the use [sic] by Indian tribes "without compensation.” Since the land in question will remain in Federal hands, it does not seem appropriate to exact a charge for its use from the tribes. The fact that many tribes have only limited financial resources also contributed to the committee’s belief that they should not be charged for land located within their own reservations. In some instances, at least, the exactment of a charge would prevent a tribe without adequate resources from obtaining needed property. This would clearly defeat efforts to institute self-sufficiency in Indian tribes.

House Report at 2 (emphasis added). As this passage makes clear, the addition of the phrase “ without compensa­ tion” in the first sentence of (a)(2) was intended to do no more than ensure that Indian tribes were not “ charged for land, located within their own reservation,” and preclude the Secretary’s exacting a charge from the tribes in connection with his acquisition of the land for their benefit. There is no suggestion that the phrase in (a)(2) was intended to change existing law on reimbursement in connection with interagency transfers under (a)(1), or that the terms of a transfer transaction under (a)(2) were not intended to be governed, at least as between the owning and acquiring federal agencies, by the preceding section. And, as we have noted, the

177 existing law would have required an agency acquiring excess § 485(c) property to reimburse the owning agency its fair value. Moreover, the very use of the term “ reimbursement” to describe the Secre­ tary’s proposed authority to levy on the Indians in the original version of the bill suggests that its drafters anticipated that the Secretary would at least in some cases have to pay something to acquire the property. This may indicate that Congress contemplated that the Secretary might have to expend funds in connec­ tion with accepting transfers under § 483(a)(2).10 We conclude, therefore, that Bonneville’s entitlement to reimbursement under §§ 483(a)( 1) and 485(c) of the Act is not affected by the passage of the 1975 law. In reaching this conclusion we are mindful of the basic canon of statutory interpretation that a statute “ ought to be so construed as to make it a consistent w hole,” and that “ the construction that produces the greatest harmony and the least inconsistency is that which ought to prevail.” 2A C. Sands, Sutherland’s Statutory Construction § 46.05 at 57 (4th ed. 1973), citing Attorney General v. Sillem, 159 Eng. Rep. 178(1863). Seealso Watt\. Alaska, 451 U.S. at2 6 7 (“ We must read the statutes to give effect to each if we can do so while preserving their sense and purpose.” ). The question of the Interior Department’s authority to expend appropriated funds on the acquisition of the excess property in question for the use and benefit of the Puyallup Tribe is not before us, although we note as possibly relevant in this regard the general authority to expend funds for the benefit of the Indians set forth in 25 U.S.C. § 13 and, more particularly, the authority to purchase land for the use and benefit of the Indians contained in 25 U.S.C. § 465. In addition, because we believe that § 483(a)(2) of the Act must be construed to leave Interior no discretion to refuse to accept transfer of excess property located within a reservation simply because the transferring agency must under § 483(a)(1) be reimbursed for it, § 483(a)(2) itself may constitute an additional source of authority to expend funds otherwise available for that purpose.'1 Cf. New York Airways, Inc. v. United States, 369 F.2d 743, 748 (Ct. Cl. 1966) (Congress’ failure to appropriate funds to meet an agency’s statutory obligation does not defeat that obligation). It may be, of course, that Interior simply does not have sufficient funds to spare from its general appropriation, consistent with fulfilling the other obligations which must be funded from this source. In this event, either

10 T h e re is no indication in the legislative h isto ry o f the 1975 am endm ents that C ongress co nsidered the situation in volving lands paid for not w ith public funds b u t w ith funds g enerated from assessm ents o f a particu lar g roup of citiz en s. S tatem en ts in the legislative history suggest that it d id not. See, e.g , House R eport at 2 ( “ the land m q u estio n w ill rem ain in F ederal han d s'1). T h is does n ot, howeveT, ca st doubt on o u r conclusion w ith respect to the p urpose o f the " w ith o u t com pensation" la nguage in (a)(2). In d eed , it reinforces it O ne m ay well ask w hether C o n g ress, if a sk ed , w ould have thought it fair o r appropriate that land in effect paid for by one gro u p o f citizen s, here B o n n ev ille 's cu sto m ers, could be transferred to a federal agency w ithout com pensation 11 It is a w ell settled p rinciple o f law that a lu m p sum appropriated fo r an ag en cy 's genera] pro g ram s and activities m ay be used by th e agency for any otherwise authorized purpose. See, e.g , In re Newport News Shipbuilding and D rydockC o., 55 C o m p G en . 81 2 , 819-21 (1 976). See also City o f Los Angeles v. Adams, 556 F.2d 4 0 ,4 9 - 5 0 (D C Cir. 1977) (an agency head's discretion to rep ro g ram funds am on g authorized program s u n d er a lum p sum ap p ro p riatio n is lim ited o n ly if a specific statu to ry directive requires the expenditure o r distrib u tio n o f funds in a p articu lar m anner). T h u s In te n o r is not legally o b lig ed to seek a new appropriation to reim burse B onneville for the land, as long as there are funds available from its unrestricted general appropriation w hich co u ld be allocated o r rep ro g ram m ed fo r this purpose.

178 Interior or Bonneville could seek an additional supplemental appropriation for that specific purpose.

T heodore B. O lson

Assistant Attorney General Office cf Legal Counsel