_______________________

                            September 19, 1997
                         ________________________


                             GSBCA 14044-RELO


                   In the Matter of MICHAEL B. HOLTZCLAW


     Michael B. Holtzclaw, Bay Minette, AL, Claimant.

     Horace H. Horn, Jr., State Director, Rural Economic and
Community Development, Montgomery, AL, appearing for Department of
Agriculture.

PARKER, Board Judge.

     Michael B. Holtzclaw, an employee of the Department of
Agriculture, was transferred to Baldwin County, Alabama on April 6,
1992.  After being granted a one-year extension to the original
two-year period for claiming relocation expenses, Mr. Holtzclaw had
until April 5, 1995, to purchase a residence in Baldwin County.

     On April 5, 1995, the last day of the period for claiming
relocation allowances, Mr. Holtzclaw completed the purchase of the
land on which he intended to build a house.  The land cost $10,000.
Mr. Holtzclaw eventually built the house, with final settlement
occurring on July 26, 1996.

     Mr. Holtzclaw requested reimbursement of $1,853 for expenses
he incurred in connection with the purchase of the land only.  He
did not claim any expenses in connection with the house, which Mr.
Holtzclaw recognizes was purchased after the period of eligibility
had expired.

     The Department of Agriculture denied the claim for expenses in
connection with the land purchase because the house in which Mr.
Holtzclaw intended to live had not been completed and occupied by
the close of the three-year eligibility period.  Mr. Holtzclaw has
requested that the Board review Agriculture's denial of his claim.

                                Discussion

     A transferred employee's entitlement to reimbursement of real
estate expenses incurred incident to relocation is governed by a
statutory provision, 5 U.S.C.  5724a(a)(4) (1994), and the
pertinent provisions of the Federal Travel Regulation (FTR), which
implements the statute.  The FTR provides that, to the extent
allowable, the Government shall reimburse a transferred employee
for expenses required for "the purchase (including construction) of
one dwelling at his/her new duty station."  41 CFR 302-6.1 (1995). 
Under subsection 302-6.2(d)(1)(x), reimbursable items include
"[e]xpenses in connection with construction of a residence, which
are comparable to expenses that are reimbursable in connection with
the   purchase  of  an  existing  residence."   Under  subsection 
302-6.2(d)(2)(vi), expenses that result from construction of a
residence are nonreimbursable.  Thomas S. Cushing, GSBCA
13867 RELO, 97-2 BCA  29,022.

     The Board has construed these provisions of the FTR to provide
that an employee who chooses to construct a home at the new duty
station will be permitted to recover real estate expenses to the
same extent as an employee who purchased an existing home.  Where
each stage of the building process involves a number of expenses
which would appropriately be reimbursed in connection with the
purchase of an existing residence, the employee may be reimbursed
only once for each type of expense that is allowable under the
regulations.  Brent T. Wahlquist, GSBCA 14163-RELO, 97-2 BCA
 29,095.

     We do not read the above provisions as prohibiting
reimbursement of otherwise allowable expenses which Mr. Holtzclaw
incurred in connection with the purchase of the land on which he
intended to build a residence.  If Mr. Holtzclaw had purchased an
existing house, certainly some of the settlement costs incurred
would have related to the land on which the house stands.  As
discussed above, the regulations are intended to ensure that the
transferred employee be reimbursed only once for each type of
expense.  Here, there is no danger of Mr. Holtzclaw being
reimbursed twice because settlement on the constructed home
occurred after the three-year period of eligibility had expired,
and Mr. Holtzclaw has acknowledged that he is not entitled to
reimbursement of those expenses.

     The General Accounting Office cases cited by Agriculture
simply do not apply to this unusual situation.  In those cases, the
employees did not settle on their new houses until after the period
of eligibility had expired.  Thus, the employees incurred no
reimbursable expenses during the period.  See, e.g., Robert J.
Jaske, B-227466 (Dec. 4, 1987); Frank Penkevich, B-226352 (June 29,
1987).  In contrast, here, Mr. Holtzclaw incurred during the
relevant period settlement expenses in connection with the land on
which his residence would be built. 

     Although, generally, the Board looks to the expenses incurred
in connection with the permanent financing on the completed house
as most representative of expenses an employee would incur to
purchase an existing residence, Wahlquist, 97-2 BCA at 144,820,
such an analysis would serve no purpose here.  Where land is
clearly purchased for construction of a residence which is
eventually completed, and there is no danger that settlement
expenses incurred in connection with the purchase of the residence
will be reimbursed twice, reimbursement of otherwise allowable
expenses is appropriate.  Here, Mr. Holtzclaw has incurred
allowable expenses up to the regulatory maximum of $500 (5 percent
of the purchase price of $10,000).  See 41 CFR 302-6.2(g)(2).  The
claim is thus granted in that amount.





                                   ______________________
                                   ROBERT W. PARKER
                                   Board Judge