                          UNITED STATES OF AMERICA
                       MERIT SYSTEMS PROTECTION BOARD
                                       2015 MSPB 26

                              Docket No. DC-0752-13-0959-I-1

                                    Gregory Einboden, 1
                                         Appellant,
                                              v.
                                 Department of the Navy,
                                           Agency.
                                      February 27, 2015

           Gregory Einboden, King George, Virginia, pro se.

           Michael L. Torres, Esquire, Norfolk Naval Shipyard, Virginia, for
             the agency.

                                          BEFORE

                           Susan Tsui Grundmann, Chairman
                            Anne M. Wagner, Vice Chairman
                               Mark A. Robbins, Member
                Vice Chairman Wagner issues a separate dissenting opinion.


                                  OPINION AND ORDER

¶1         The appellant petitions for review of an initial decision that affirmed the
     agency’s furlough action. For the following reasons, we DENY the appellant’s
     petition for review and AFFIRM the initial decision AS MODIFIED by this
     Opinion and Order, still AFFIRMING the agency’s furlough action.                  We


     1
      Pursuant to 5 C.F.R. § 1201.36(a), this appeal was part of a consolidation, Naval Sea
     Systems Command Dahlgren v. Department of the Navy, MSPB Docket No.
     DC-0752-14-0267-I-1.
                                                                                                        2

     MODIFY the initial decision to clarify the administrative judge’s nexus analysis,
     agreeing with his determination that the agency proved by preponderant evidence
     that the furlough action in this case promotes the efficiency of the service.

                                          BACKGROUND
¶2            The   agency’s     Naval   Surface          Warfare     Center      Dahlgren      Division
     (NSWCDD) issued a decision notice furloughing the appellant for no more than
     11 workdays from his NT-6 Manager position. Einboden v. Department of the
     Navy, MSPB Docket No. DC-0752-13-0959-I-1, Initial Appeal File (IAF), Tab 1
     at 10-13, Tab 3 at 2. 2 The proposal notice had informed the appellant that the
     action was “necessitated by the extraordinary and serious budgetary challenges
     facing the Department of Defense (DOD) for the remainder of Fiscal Year (FY)
     2013, the most serious of which is the sequester that began on 1 March 2013,”
     i.e., across-the-board reductions to federal budgetary resources.                     IAF, Tab 1
     at 14; see 2 U.S.C. § 900(c)(2) (as used in 2 U.S.C. chapter 20, subchapter I,
     “[t]he terms ‘sequester’ and ‘sequestration’ refer to or mean the cancellation of
     budgetary      resources    provided      by     discretionary       appropriations       or   direct
     spending law”).
¶3            On appeal to the Board, the appellant asserted that the agency should not
     have      furloughed      him   because        his   salary     is    paid    out    of    working
     capital/intragovernmental funds, not an account using funds appropriated by
     Congress to DOD or the Department of the Navy. IAF, Tab 1 at 5. The appellant
     also     alleged   that    intragovernmental         funds     are   generally      exempt     from
     sequestration under the Balanced Budget and Emergency Deficit Control Act of
     1985 (BBEDCA) 3 and that no money was sequestered from the agency’s working

     2
         The agency ultimately furloughed the appellant for 6 days. IAF, Tab 12 at 5.
     3
       Pub. L. No. 99-177, Title II, Part C, 99 Stat. 1037, 1063-93 (codified in pertinent part
     as amended at 2 U.S.C. §§ 900-907d).
                                                                                      3

     capital fund (WCF). Id. at 5-7. Thus, he asserted that there was no reason for his
     furlough because there was no extraordinary and serious budgetary challenge
     with respect to the NSWCDD, which he claimed had an abundance of customer
     orders and a significant, available cash balance.      Id. at 7-8.   The appellant
     asserted that funds from the Navy WCF Dahlgren Division were not transferred to
     any Operations and Maintenance Account, despite language in the proposal notice
     suggesting such a transfer would occur, and that funds that would have paid his
     salary but for the furlough were not moved to another account to fund, for
     example, warfighter operations. IAF, Tab 20 at 2. The appellant also alleged
     that the agency violated his due process rights and committed harmful error.
     IAF, Tab 1 at 6-8.
¶4         The administrative judge consolidated this appeal with other appeals from
     similarly-situated appellants.    Naval Sea Systems Command Dahlgren v.
     Department of the Navy, MSPB Docket No. DC-0752-14-0267-I-1, Consolidated
     Appeal File (CAF), Tab 1; IAF, Tab 9. After a hearing, the administrative judge
     affirmed the furlough action. CAF, Tab 15, Initial Decision (ID) at 2, 30. The
     administrative judge found that the agency proved that the furloughs promoted
     the efficiency of the service by offering unrebutted evidence that it had to make
     significant spending cuts because of sequestration and that the furloughs, along
     with other measures, helped it avoid a deficit. ID at 17-18. He also held that the
     agency offered evidence that it imposed the furloughs uniformly with exceptions
     for limited categories of employees and that the furloughs were a reasonable
     management solution to the financial issues facing the agency. ID at 18-19.
¶5         The administrative judge further held that the agency provided the
     appellants with due process and that the appellants did not prove their affirmative
     defenses, including allegations that the agency was precluded by 10 U.S.C. § 129
     and the BBEDCA from furloughing them. ID at 19-29. The administrative judge
     found that the BBEDCA exempted WCFs from sequestration orders only to the
     extent that those funds do not “rely upon direct appropriations” and that the
                                                                                         4

     appellants did not show or even argue that the NSWCDD relied upon any funds
     other than those coming from direct appropriations received by its governmental
     customers. ID at 29. Thus, he held that the BBEDCA did not shield WCFs from
     the effects of sequestration.   ID at 29.   The administrative judge noted that,
     although an Office of Management and Budget (OMB) report appeared to classify
     the agency’s WCF account, at least in part, as exempt from sequestration, he
     knew of no reason why the Board should consider an OMB report as controlling
     legal authority. ID at 29. He therefore gave the report little evidentiary weight
     and found it unpersuasive regarding the contested issues in the appeal. ID at 29.
¶6         Finally, the administrative judge found that, even assuming that WCF
     accounts are exempt from a sequester order, “that does not necessarily mean the
     Department could not furlough the employees whose salaries it paid from those
     WCF accounts.” ID at 29. The administrative judge held that, although some
     appellants argued that WCFs do not constitute direct appropriations, they did not
     dispute that the funds received from governmental customers were direct
     appropriations.   ID at 29.     Thus, the administrative judge found that the
     $500 million the agency alleged it saved from furloughing WCF employees
     represented “$500 million less in sequestered direct appropriations that the
     WCFs’ governmental customers would have needed to pay had the Department
     not furloughed WCF employees.” ID at 29-30. The administrative judge held
     that, regardless of how WCFs were categorized, either as direct appropriations or
     something else, “statutory limitations regarding accounts that were subject to
     sequester do not necessarily constitute equivalent limitations with respect to
     which employees the agency could properly furlough.” ID at 30.

                                        ANALYSIS
¶7         The appellant asserts on review that the agency did not rebut any of the
     testimony he provided at the hearing, that the evidence the agency presented is
     irrelevant to his furlough, and that the agency has presented no evidence as to
                                                                                              5

     why the furlough of WCF employees was proposed, why the furlough took place
     in the absence of a sequester of WCFs, and why he was furloughed for 6 days
     when the alleged savings from the appellant’s salary never left the NSWCDD.
     Petition for Review (PFR) File, Tab 1 at 3. The appellant contends that, although
     the proposal and decision notices relied upon the sequester, no sequester of funds
     occurred at NSWCDD.           Id. at 4.    The appellant further asserts that the
     administrative judge did not fully address evidence in the record relating to how
     WCFs operate and why they were exempt from sequestration.                Id. at 5.    The
     appellant contends that, given the agency’s admission that the money saved from
     the furlough was “available” to be used, but was not in fact used to satisfy any
     funding shortfall, the agency could have furloughed him for fewer than 6 days,
                                                                               4
     including 0 days, because there was no financial need to do so.               Id.    In its
     response to the petition for review, the agency asserts that the appellant is
     attempting to expand the burden placed on the agency by requiring it to show that
     the specific funds used to pay his salary were affected by sequestration, even
     though there is no Board or court decision supporting such a requirement. PFR
     File, Tab 4 at 7.
¶8         A “furlough” is the placing of an employee in a temporary status without
     duties and pay due to a lack of work or funds or other nondisciplinary reasons.
     5 U.S.C. § 7511(a)(5); 5 C.F.R. § 752.402.         Furloughs of 30 days or less are
     reviewable by the Board under the “efficiency of the service” standard of
     5 U.S.C. § 7513(a). Chandler v. Department of the Treasury, 120 M.S.P.R. 163,
     ¶ 5 (2013).   An agency satisfies this “efficiency of the service” standard in a

     4
        The appellant asserts on review that the agency treated him differently from
     Department of the Air Force attorneys who were not furloughed. PFR File, Tab 1
     at 13-14. Because the appellant did not raise this argument below, and he has not
     shown that it is based on new and material evidence not previously availab le despite his
     due diligence, we will not address it for the first time on review. See Banks v.
     Department of the Air Force, 4 M.S.P.R. 268, 271 (1980).
                                                                                                 6

      furlough appeal by showing, among other things, that the furlough was a
      reasonable management solution to the financial restrictions placed on it. Id.,
      ¶ 8.
¶9           The appellant essentially asserts that, under Chandler, there were no
      financial restrictions placed upon the NSWCDD that warranted his furlough
      because the NSWCDD paid his salary by means of WCFs that were not subject to
      a sequester order under the BBEDCA.                Addressing this argument, therefore,
      requires an analysis of both the nature of WCFs in the federal government and the
      relevant provisions of the BBEDCA.
¶10          Under 10 U.S.C. § 2208(a), to control and account more effectively for the
      cost of programs and work performed in DOD, the Secretary of Defense may
      require the establishment of WCFs to (1) finance inventories of designated
      supplies and (2) provide working capital for industrial-type activities and
      commercial-type activities that provide common services within or among
      departments and agencies of DOD. WCFs are generally charged with the cost of
      certain     supplies,   services,     and   work     performed,     including   applicable
      administrative expenses, and are reimbursed from available appropriations or
      otherwise credited for those costs. 10 U.S.C. § 2208(c). Subject to the authority
      and direction of the Secretary of Defense, the Secretary of each military
      department shall allocate responsibility for its functions, powers, and duties to
      accomplish the most economical and efficient organization and operation of the
      activities for which WCFs are authorized.                10 U.S.C. § 2208(e).            The
      requisitioning agency may not incur a cost for services or work performed by
      industrial-type or commercial-type activities for which WCFs may be established
      that is more than the amount of appropriations or other funds available for those
      purposes.      10 U.S.C. § 2208(f).         Finally, under 10 U.S.C. § 2208(r)(1),
      “Notification     of    transfers,”   notwithstanding     any     authority   provided    in
      section 2208 to transfer funds, the transfer of funds from a WCF, including a
      transfer to another WCF, shall not be made under such authority unless the
                                                                                       7

      Secretary of Defense submits, in advance, a notification of the proposed transfer
      to the congressional defense committees in accordance with customary
      procedures. The amount of a transfer as described above that is made in a fiscal
      year does not count toward any limitation on the amount of transfers that may be
      made for that fiscal year under authority provided to the Secretary of Defense in a
      law authorizing or making appropriations for DOD.           10 U.S.C. § 2208(r)(2).
      Thus, a WCF is a type of intragovernmental revolving fund that operates as a
      self-supporting entity that conducts a regular cycle of businesslike activities and
      functions entirely from the fees charged for the services provided consistent with
      its statutory authority.   IAF, Tab 21 at 53 (September 2005 U.S. Government
      Accountability Office Glossary of Terms Used in the Federal Budget Process).
¶11         The BBEDCA, as amended, requires the President, if the federal budget
      deficit exceeds a certain amount, to issue a sequestration order mandating
      across-the-board spending reductions to reach a targeted deficit level.        See
      2 U.S.C. § 901a(5)-(6); Bowsher v. Synar, 478 U.S. 714, 717-18 (1986); Berlin v.
      Department of Labor, 772 F.3d 890, 892 (Fed. Cir. 2014).             The BBEDCA
      identifies, however, certain exempt programs and activities, including a list of
      budget accounts and activities that “shall be exempt from reduction” under any
      applicable sequestration order.     2 U.S.C. § 905(g)(1)(A).     One such budget
      account or activity involves “[i]ntragovernmental funds, including those from
      which the outlays are derived primarily from resources paid in from other
      government accounts, except to the extent such funds are augmented by direct
      appropriations for the fiscal year during which an order is in effect.” Id.
¶12         In a March 1, 2013 OMB Report to Congress on the Joint Committee
      Sequestration for FY 2013, the sequestrable budget amount for the Navy WCF is
      $24 million, with the sequester amount being only $2 million. IAF, Tab 21 at 43,
      45. This report also notes that “[f]or intragovernmental payments, sequestration
      is applied to the paying account,” while the funds “are generally exempt in the
      receiving account in accordance with section 255(g)(1)(A) of BBEDCA so that
                                                                                      8

      the same dollars are not sequestered twice.”     IAF, Tab 21 at 46.     President
      Obama’s March 1, 2013 sequestration order for FY 2013 provides that all
      sequestrations shall be made in strict accordance with the requirements of the
      BBEDCA.      Id. at 49.   A June 2013 DOD Report on the Joint Committee
      Sequestration for FY 2013 appears to show that the Navy WCF received no
      appropriated funding for FY 2013 except for $24.2 million as part of the Disaster
      Relief Act of 2013 and that there was no sequestration for FY 2013 from the
      Navy WCF. Id. at 68-70.
¶13         The administrative judge interpreted 2 U.S.C. § 905(g)(1)(A) as not
      shielding WCFs from sequestration but also held, in the alternative, that, even if
      WCF accounts were exempt from sequestration, the agency could still furlough
      employees who were paid from those accounts. ID at 29-30. We need not decide
      whether the administrative judge’s interpretation of section 905(g)(1)(A) is
      correct because we agree with the administrative judge’s alternative analysis.
      The BBEDCA itself does not prohibit a furlough of WCF employees. Thus, even
      assuming that section 905(g)(1)(A) did exempt the NSWCDD’s WCFs from a
      sequestration order, such an interpretation would not end our inquiry into whether
      there were financial restrictions placed on the agency and whether the furlough
      was a reasonable management solution to those restrictions.        See Chandler,
      120 M.S.P.R. 163, ¶ 8.
¶14         Regarding the existence of financial restrictions, the Under Secretary of
      Defense (Comptroller)/Chief Financial Officer of DOD averred that various
      factors, including sequestration, a misallocation of funds under a Continuing
      Resolution, and unexpectedly high wartime costs, created a $40 billion budgetary
      shortfall and that furloughs of all DOD civilians would save about $2 billion in
      FY 2013, including more than $500 million associated with reduced personnel
      costs in WCF activities. CAF, Tab 2, Navy Administrative Record at 4, 6, 11-12.
      He asserted that these WCF personnel savings “provide us the flexibility to adjust
      maintenance funding downward to meet higher-priority needs.” Id. at 12. He
                                                                                       9

      further averred that the Department of the Air Force expected to reduce funded
      orders in their WCFs by about $700 million to meet higher-priority needs, while
      the Department of the Army expected to reduce orders by $500 million. Id.
¶15         In Yee v. Department of the Navy, 121 M.S.P.R. 686, ¶¶ 9, 14 (2014), the
      Board held that, although the Department of the Navy is separately organized
      under the Secretary of Navy, it operates under the authority, direction, and
      control of the Secretary of Defense.      Similarly, the Secretary of the Navy’s
      responsibility for the operation of WCF activities is subject to the authority and
      direction of the Secretary of Defense. 10 U.S.C. § 2208(e). We also held in Yee,
      121 M.S.P.R. 686, ¶ 14, that the Secretary of the Navy is responsible for the
      effective and timely implementation of policy, program, and budget decisions and
      instructions of the President or the Secretary of Defense relating to the functions
      of the Navy. Thus, the Board held that, although the appellants asserted that the
      Navy had adequate funding to avoid the furloughs, it was reasonable for DOD to
      consider its budget situation holistically, rather than isolating each individual
      military department’s situation.    Id.   Similarly, we find that, although the
      NSWCDD may have had adequate funding to avoid a furlough of the appellant, it
      was reasonable for DOD to consider its budget situation holistically, rather than
      isolating the situation of each individual Navy organization or component.
¶16         We further find that the furlough action was a reasonable management
      solution to the financial restrictions set forth above.        See Federal Drug
      Administration v. Davidson, 46 M.S.P.R. 223, 226 (1990) (even if a sequestration
      does not affect the funds used to pay for work that is to be performed by an
      employee, the agency can still institute a furlough action against the employee
      based on the agency’s budgetary deficit). There is no indication in the record that
      the Secretary of Defense was prohibited from using savings resulting from the
      furloughs of WCF employees to address other budgetary needs. In fact, the law
      and the record suggest otherwise. As set forth above, a transfer of funds from a
      WCF may be made if the Secretary of Defense submits, in advance in accordance
                                                                                     10

      with customary procedures, a notification of the proposed transfer to the
      congressional defense committees. 10 U.S.C. § 2208(r)(1). It appears that such
      transfers from WCFs have happened in the past. See David R. Obey, Comp. Gen.
      No. B-318724, 2010 WL 2546935 (June 22, 2010).         Moreover, the declaration
      discussed above from the Under Secretary of Defense (Comptroller)/Chief
      Financial Officer of DOD reflects that personnel cost savings of $500 million
      from the furlough of WCF employees provided flexibility to adjust maintenance
      funding downward.      The deciding official, who is also the Deputy Division
      Technical Director of the NSWCDD and the second-in-command on the civilian
      side of the organization, similarly testified that the agency saved “20 percent”
      during the 6 weeks in which employees were furloughed and that “the operating
      cost was available to be recalled, if need be, by the Agency.” Hearing Transcript
      (HT) at 12-13, 31. The appellant does not assert that the savings could not have
      been used elsewhere.    Rather, he contends that the savings from the furlough
      were not used elsewhere. PFR File, Tab 1 at 5.
¶17         The agency conceded that “no funds were actually sequestered or
      recaptured from the WCF at NSWCDD or any other WCF activity within the
      Agency.” CAF, Tab 14 at 14; see HT at 38, 51 (testimony of the deciding official
      that the Dahlgren Division does not receive a direct operations and maintenance
      appropriation with which to pay salaries and that, during the days that the agency
      furloughed the appellant, there was money available at that time with which to
      pay the appellant’s salary). The agency asserted that WCF activities are funded
      by Operations and Maintenance funds that “flow downwards” through each of the
      departments of DOD and that, “[b]y furloughing its employees, to include WCF
      employees, the Agency had the ability to not only decrease expenditures flowing
      down to operate WCF activities, but it also realized a 20% savings in operating
      costs that were available to be recapture[d] from the WCF if necessary.” CAF,
      Tab 14 at 14-15.    The agency contended that these savings, “although they
      may not have actually been recaptured by the Agency and reprogram[m]ed for
                                                                                       11

      other things, were available and gave the Agency the flexibility to recapture and
      redistribute to fund higher priority items if the need arose.” Id. at 15. There is
      no indication in the record that any of the customers of the NSWCDD reduced or
      planned to reduce their orders or payments to the NSWCDD as a result of the
      sequestration.   In fact, it is possible that those customers simply could have
      continued to pay the NSWCDD for their orders and absorbed the effects of the
      sequestration in other ways. There is also no indication in the record explaining
      what the agency did with any savings it achieved from furloughing the appellant,
      who was paid by WCFs.
¶18         Nevertheless, the agency was not required to show that any of the funds
      saved from the appellant’s furlough actually left the NSWCDD to be used for any
      other DOD purpose. Cf. Cross v. Department of Transportation, 127 F.3d 1443,
      1447 (Fed. Cir. 1997) (finding the initiation of a reduction in force was proper
      when agency officials reasonably anticipated a budget shortfall). Rather, to meet
      the efficiency of the service standard, it is enough for the agency to show that the
      furlough action was a reasonable management solution at the time the action was
      taken. Cf. In re Tinker AFSC/DP v. Department of the Air Force, 121 M.S.P.R.
      385, ¶¶ 21-22 (2014) (in determining the legitimacy of the reasons for a decision
      not to furlough certain employees when the agency asserts that it was precluded
      from doing so by law, rule, or regulation, the Board need not determine after the
      fact whether a decision not to furlough those employees was actually permissible;
      rather, the question is whether the agency reasonably and genuinely believed that
      it was precluded from furloughing that group of employees); Clerman v.
      Interstate Commerce Commission, 35 M.S.P.R. 190, 194 (1987) (recognizing that
      the appropriateness of an agency’s decision to release employees by reduction in
      force because of staffing limitations is judged based on the agency’s ceilings
      when the actions were taken, not on events that occur after the fact). We find,
      based on our determination that savings from the furlough of WCF employees
                                                                                            12

      could have been used to address other higher-priority budgetary needs, that the
      agency has met that burden of proof by preponderant evidence in this case. 5
¶19         Accordingly, we DENY the petition for review and AFFIRM the initial
      decision as modified by this Opinion and Order.

                                              ORDER
¶20         This is the final decision of the Merit Systems Protection Board in this
      appeal. Title 5 of the Code of Federal Regulations, section 1201.113(c) (5 C.F.R.
      § 1201.113(c)).

                        NOTICE TO THE APPELLANT REGARDING
                           YOUR FURTHER REVIEW RIGHTS
            You have the right to request review of this final decision by the
      United States Court of Appeals for the Federal Circuit. You must submit your
      request to the court at the following address:
                                 United States Court of Appeals
                                     for the Federal Circuit
                                   717 Madison Place, N.W.
                                    Washington, DC 20439

      The court must receive your request for review no later than 60 calendar days
      after the date of this order. See 5 U.S.C. § 7703(b)(1)(A) (as rev. eff. Dec. 27,
      2012). If you choose to file, be very careful to file on time. The court has held
      that normally it does not have the authority to waive this statutory deadline and


      5
        The d issent, noting that the statute provides that an agency must demonstrate that its
      action “will” promote the efficiency of the service, would require the agency to provide
      evidence that the funds saved as a result of the furlough were actually used to protect
      wartime operations. As stated above, however, the Board has long held that the
      efficiency of the service standard is met by showing that, when the agency took the
      action, the furlough was a reasonable management solution to the financial restrictions
      at issue. Our determ ination that the agency met this burden is consistent with that
      precedent and it recognizes the practicalities involved in the agency’s decisionmaking
      process, rather than reviewing it with the benefit of h indsight.
                                                                                 13

that filings that do not comply with the deadline must be dismissed. See Pinat v.
Office of Personnel Management, 931 F.2d 1544 (Fed. Cir. 1991).
      If you need further information about your right to appeal this decision to
court, you should refer to the federal law that gives you this right. It is found in
Title 5 of the United States Code, section 7703 (5 U.S.C. § 7703) (as rev. eff.
Dec. 27, 2012).    You may read this law as well as other sections of the
United States Code, at our website, http://www.mspb.gov/appeals/uscode/htm.
Additional     information     is    available    at     the    court’s    website,
www.cafc.uscourts.gov. Of particular relevance is the court’s “Guide for Pro Se
Petitioners and Appellants,” which is contained within the court’s Rules of
Practice, and Forms 5, 6, and 11.
      If you are interested in securing pro bono representation for your court
appeal, you may visit our website at http://www.mspb.gov/probono for a list of
attorneys who have expressed interest in providing pro bono representation for
Merit Systems Protection Board appellants before the court. The Merit Systems
Protection Board neither endorses the services provided by any attorney nor
warrants that any attorney will accept representation in a given case.



FOR THE BOARD:


______________________________
William D. Spencer
Clerk of the Board
Washington, D.C.
          DISSENTING OPINION OF VICE CHAIRMAN ANNE M. WAGNER

                                              in

                        Gregory Einboden v. Department of the Navy

                          MSPB Docket No. DC-0752-13-0959-I-1

¶1         The majority opinion finds that the agency’s furlough action promotes the
     efficiency of the service even though there is no indication that any savings
     generated by the furlough of the appellant, a working capital fund (WCF)
     employee, was transferred or used in any way to address the budgetary challenges
     facing the Department of Defense (DOD). Because I believe that the majority has
     strayed from the Board’s statutory responsibility to ensure that adverse action
     furloughs may only be sustained by the Board when they are taken for such cause
     as “will promote the efficiency of the service,” I respectfully dissent.
¶2        Under 5 U.S.C. § 7513(a), an agency may take an action such as the
     furlough in this case “only for such cause as will promote the efficiency of the
     service.” Notably, section 7513(a) requires that the cause for the action “will”
     promote the efficiency of the service, and does not permit actions based on cause
     that only “may” or “could” promote the efficiency of the service. See Guillebeau
     v. Department of the Navy, 362 F.3d 1329, 1332-33 (Fed. Cir. 2004) (noting the
     distinction between the mandatory “will” and the discretionary “may”).       The
     Board has recognized that something more than a mere possibility is required to
     meet the efficiency of the service standard. In Lara v. Mine Safety and Health
     Administration, 10 M.S.P.R. 554, 556 (1982), for example, the Board held that an
     agency need not wait for a mine inspector to cause injury to himself or others
     because of his vision limitations as long as the likelihood of such event is
     “reasonably foreseeable.”      Similarly, in Doe v. National Security Agency,
     6 M.S.P.R. 555, 562 (1981), aff’d sub nom. Stalans v. National Security Agency,
     678 F.2d 482 (4th Cir. 1982), the Board held that the deleterious effect of
     misconduct on the efficiency of the service may be either presently existent or
                                                                                        2

     “reasonably foreseeable.” In other words, the nexus requirement, for purposes of
     determining whether an agency has shown that its action promotes the efficiency
     of the service, means that there must be a “clear and direct relationship” between
     the articulated grounds for an adverse action and some legitimate government
     interest. Merritt v. Department of Justice, 6 M.S.P.R. 585, 596 (1981), modified
     by Kruger v. Department of Justice, 32 M.S.P.R. 71, 75 n.2 (1987).
¶3        The Board has long held that the efficiency of the service standard in a
     furlough case is met by showing that the furlough is a reasonable management
     solution to the financial restrictions at issue. See Clark v. Office of Personnel
     Management, 24 M.S.P.R. 224, 225 (1984); see also Chandler v. Department of
     the Treasury, 120 M.S.P.R. 163, ¶ 8 (2013). However, in order to continue to
     fulfill the statutory efficiency of the service standard in these types of cases, and
     consistent with such cases as Lara and Doe, I would find that, in order to prove
     that the furlough of a WCF employee was a reasonable management solution,
     there must be at least some indication that it was reasonably foreseeable that the
     savings from the furlough would address the budgetary challenges, thereby
     promoting the efficiency of the service.
¶4        Here, the notice of proposed furlough provides that “[t]his administrative
     furlough is necessitated by the extraordinary and serious budgetary challenges
     facing the Department of Defense (DOD) for the remainder of Fiscal Year (FY)
     2013, the most serious of which is the sequester that began on 1 March 2013.”
     Initial Appeal File (IAF), Tab 1 at 14. The proposal notice also provides that
     DOD “must and will protect wartime operations funding for our troops in harm’s
     way,” that this “inevitably means larger cuts in base-budget funding for the
     Operation and Maintenance (O&M) accounts,” and that “[t]hus, the DOD will
     need funding in other accounts that can be used to provide the warfighters with
     what they need to protect national security and fight the war.” Id. The clear
     implication from the proposal notice is that the funds saved as a result of the
     furlough will be used to protect wartime operations funding.
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¶5          Although an agency may be able to meet the efficiency of the service
     requirement in some other furlough case involving a WCF, I would find that the
     agency has not met that requirement here. The majority’s decision notes that,
     under 10 U.S.C. § 2208(r)(1), a transfer of funds from a WCF may be made if the
     Secretary of Defense submits, in advance, a notification of the proposed transfer
     to the congressional defense committees in accordance with customary
     procedures. There is no evidence that DOD submitted or even planned to submit,
     in advance of the furlough or at any other time, such notification to the
     congressional defense committees with respect to funds saved from the furlough
     of employees at the Naval Surface Warfare Center Dahlgren Division
     (NSWCDD).       Nor is there any evidence in the record showing that it was
     reasonably foreseeable that the funds saved from the furlough of the appellant
     would otherwise actually be used to address the budgetary challenges facing
     DOD.     In the absence of such evidence, I would find that furloughing the
     appellant as an employee of a WCF entity has not been shown to be a reasonable
     management solution. There has been no “clear and direct relationship” between
     the articulated grounds for the furlough of employees at the NSWCDD and a
     legitimate government interest.
¶6          The cases relied upon by the majority are distinguishable from this case and
     do not warrant the outcome reached by the majority. In Cross v. Department of
     Transportation, 127 F.3d 1443, 1447 (Fed. Cir. 1997), the court held that
     “[w]here agency officials reasonably and genuinely believe that the agency’s
     abolition is inevitable and its funding is to be terminated, initiation of a
     [reduction in force (RIF)] is proper,” and that conducting a RIF because of an
     anticipated shortage of funds does not require that the shortage exist at the time
     of the RIF. As expressed in my separate opinion in Chandler, 120 M.S.P.R. 163,
     ¶¶ 1-9 (dissenting opinion of Vice Chairman Wagner), however, the RIF statute
     and regulations do not incorporate an “efficiency of the service” standard. See
     5 U.S.C. § 3502; 5 C.F.R. Part 351. Thus, the holding in Cross is not persuasive
                                                                                        4

     in the context of this adverse action furlough.      Similarly, the Board in In re
     Tinker AFSC/DP v. Department of the Air Force, 121 M.S.P.R. 385, ¶ 21 (2014),
     held that, in determining the legitimacy of the reasons for a decision not to
     furlough certain employees when the agency asserts that it was precluded from
     doing so by law, rule, or regulation, the Board need not determine after the fact
     whether a decision not to furlough certain employees was actually permissible
     under applicable law, rule, and regulation.      Rather, in deciding whether the
     agency’s decision not to furlough certain employees was based on legitimate
     management reasons or reasons “personal” to a group of employees, the question
     is whether the agency reasonably and genuinely believed that it was precluded
     from furloughing that group of employees. Id. Because the agency furloughed
     all employees within the Eastern Region and there is therefore no question as to
     whether a decision not to furlough certain employees was permissible under law,
     rule, or regulation, the standard set forth in Tinker does not apply in this case. In
     Clerman v. Interstate Commerce Commission, 35 M.S.P.R. 190, 194-95 (1987),
     the Board held that the appropriateness of an agency’s decision to release
     employees because of staffing limitations is to be judged based on the agency’s
     ceilings when the actions were taken, not on events that occurred after the fact.
     This holding is consistent with my views in this dissenting opinion, as I too
     would judge the action based on what the agency has shown was reasonably
     foreseeable when it took the action.
¶7        In sum, I would reverse the agency’s action furloughing the appellant
     because the agency has not shown under the facts of this case that the action
     promoted the efficiency of the service under 5 U.S.C. § 7513(a).



     ______________________________
     Anne M. Wagner
     Vice Chairman
