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On December 28, 2001, President
Bush signed into law Senate Resolution 1438, National
Defense Authorization Act for Fiscal Year 2002.
Section 1116 of this legislation repeals Section
6008 of the Federal Acquisition Act of 1994 and
allows Federal employees to accept promotional
items such as frequent flyer miles earned when
traveling in an official capacity. The legislation
applies to frequent flyer miles received before
and after the date of enactment. The following
is additional information regarding this new authority:
Application to 31 United
States Code (U.S.C.) 1353
The frequent flyer promotional materials must
be obtained under the same terms as those offered
to the general public at no additional cost to
the Government. Gifts of travel from a non-Federal
source continue to be treated under 31 U.S.C.
1353.
Taxability of the Benefit
It is possible that such benefits may be considered
additional compensation and could be taxed accordingly.
Until a ruling is received, it is recommended
that Federal employees who redeem frequent flyer
miles or other promotional benefits keep a record
of such redemptions.
Upgrade to First Class
It is the policy of the Government that employees
generally must travel by coach class accommodations.
However, employees may now upgrade their transportation
class of service at their own expense.
General Guidance
Federal travelers are permitted to voluntarily
give up their seats at no additional cost to the
Government. All per diem charges and additional
travel expenses incurred as a result of voluntarily
giving up a seat are the traveler's financial
responsibility. For travelers involuntarily denied
a seat, the traveler is entitled to per diem and
miscellaneous expense reimbursement. Monetary
compensation, including meal and/or lodging vouchers
for the denied seat, is the responsibility of
the Government.
Inquiries regarding this memorandum should be
referred to your supervisor. For more information,
supervisors should contact the National Finance
Center's Ethics Office at Extension 5-5679 or
5-5580.
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