June 20, 1997
                                                   


                             GSBCA 14150-RELO


                      In the Matter of PIERRE S. WARE


     Pierre S. Ware, Panama City, FL, Claimant.

     Judy Hughes, Travel Policy, Defense Finance and Accounting
Service, Columbus, OH, appearing for Department of Defense.

GOODMAN, Board Judge.

     Claimant, Pierre S. Ware, is a civilian employee of the
Department of the Navy.  In October 1995, he made a permanent
change of station move from Newport News, Virginia, to Panama City,
Florida. 

     The purchaser of Mr. Ware's residence financed the transaction
through the Department of Veterans Affairs (VA).  Among other
closing costs, the claimant paid the following:

     Loan Origination Fee               $1,324.50
     Title Insurance (Lender's)            266.00
     Recording Fees (Mortgage and Deed)     32.00
     City/County Tax/Stamps                131.20 
     State Tax/Stamps                      393.60
     Survey                                165.00

     These costs were disallowed by Mr. Ware's activity, the Naval
Surface Warfare Center (NSWC).  In their opinion, the expenses are
those normally paid by the buyer of a home, and it is not the
customary practice in Virginia for sellers to pay buyer's closing
costs.  

     Claimant has requested that this Board review the agency's
decision.  Both claimant and the agency have submitted additional
information in an attempt to clarify whether the payment of such
closing costs is customarily made by the seller in Newport News,
Virginia, and claimant has asked for a determination whether the
information is sufficient to establish this custom.  If so, the
agency has stated payment is recommended, since "the expenses are
reasonable in amount and clearly allowable under the provisions of
the Joint Travel Regulations . . . ." 

     The Joint Travel Regulations, which supplement the Federal
Travel Regulation and apply to federal civilian employees of the
Department of Defense, allows the agency to reimburse the items in
question "in connection with the sale . . . of a residence,
provided they are customarily paid by the seller of a residence in
the locality of the old official PDS [permanent duty station]
. . . ."  JTR C14002-A.4.a.  

     In making the initial determination that such items were not
customarily paid by the seller, the agency's Office of General
Counsel contacted Ms. Virginia Holman at the Department of Housing
and Urban Development (HUD) in Richmond, Virginia.  Ms. Holman
stated that while the sellers may pay the buyer's closing costs in
the Newport News, Virginia, area, this is negotiable.  Thus, by
assuming the buyer's costs, the seller is reducing the selling
price of the residence.  She cited a decision of the Comptroller
General on this issue, which held that when payment of such costs
by the seller is not customary, the payment by seller of closing
costs is actually a price concession for which the agency will not
reimburse the employee.  However, she also stated that her office
does not keep information on VA loans, and she was therefore unable
to provide accurate information concerning the customary practices
for VA financed homes.

     The agency also supplied a letter that they recently received
regarding a similar case involving a VA loan, which reads, in
relevant part:

          VA does not have a list of customary closing costs
     that may be paid by the seller.  VA allows sellers to pay
     a portion or all closing costs on a VA transaction, as
     long as the amount paid by the seller does not exceed 4
     percent of the reasonable value of the property.

     In the absence of a list of clearly defined customary closing
costs for VA financed homes, the agency recommended that Mr. Ware
contact some realtors in the Newport News area and obtain a letter
from each stating the local customary practices.  Mr. Ware obtained
two letters from realtors in the Newport News/Hampton, Virginia,
area which read, in relevant part as follows:

          This is to inform you that in the state of Virginia
     it is customary for the Seller(s) of property to pay
     purchaser[']s closing costs and discount points in
     relation to the purchase of that home.

                                 * * * * *

          Regarding the sale of residential real estate on the
     Virginia Peninsula, It is a fairly normal practice . . .
     that 95% of the time the seller of a home will pay the
     closing cost of the buyer . . . .

     When questions of local custom arise, as in other matters, the
burden is on the claimant to show why he or she should prevail. 
48 CFR 6104.4(c) (1996); Christopher L. Chretian, GSBCA 13704-RELO,
97-1 BCA  28,701 (1996).  Mr. Ware has met this burden.  Through
the information supplied by both the agency and Mr. Ware, Mr. Ware
has demonstrated that in Hampton, Virginia, it was customary for
the seller of residential real estate to pay the closing costs for
which he seeks reimbursement.  As the agency has stated that the
amounts of the costs claimed are reasonable, Mr. Ware is entitled
to reimbursement of the amounts claimed.





                                   _______________________
                                   ALLAN H. GOODMAN
                                   Board Judge