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B-241744 1 (1991-05-31)

handle is hein.gao/gaobadsdf0001 and id is 1 raw text is: O United States GO General Accounting Office Washington, D.C. 2054 OffIce of the General Counsel B-241744 May 31, 1991 E. M. Keeling Director of Accounting Federal Aviation Administration U.S. Department of Transportation 800 Independence Avenue, S.W. Washington, D.C. 20591 Dear Mr. Keeling: This is in response to your letter of October 1, 1990, requesting our opinion as to the proper disposition of funds in your custody that belonged to a now inactive FAA employee club. According to your letter, the Federal Aviation Club (Club) was established in the early 1960's as a non-profit organization to promote the welfare of, and goodfellowship among, Federal Aviation Administration (FAA) employees. During the mid- 1980's Club activities declined; the Club currently has no active members and has, effectively, ceased operations. Your staff has been unable to locate any documentation reflecting the creation of the Club, e.g., charter or bylaws, or its dissolution. In 1990 the FAA Office of the Inspector General (OIG) received a hotline complaint alleging that the Club's internal controls over funds received were inadequate. A subsequent OIG audit concluded that controls were indeed inadequate but that no funds were mismanaged or diverted. During the course of the audit, the OIG discovered a bank account in the Club's name with the local credit union. The account balance is $10,000 consisting mainly of revenues received from Guest Services, Incorporated (GSI). GSI operates a beauty parlor and barber shop at the FAA headquarters building (Federal Building 10-A) which is operated by the General Services Administration (GSA).1/ A purported letter agreement, dated June 17, 1965, 1/ Your letter seems to question the absence of any provision for the payment of any rent or concession fees by GSI in the GSA-GSI contract. GSI's current contract was entered into on July 21, 1971. It does not have an expiration date but can be cancelled by either party on 196 days notice. Our Office has stated that such an agreement is not unlawful, improper or contrary to public policy. See generally LCD-78-316, May 5, 1978; See also 64 Comp. Gen. 217,220 (1985).

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