B-163758, MAY 6, 1971

B-163758, MAY 6, 1971

SUBJECT: USE OF IMPREST FUNDS TO PAY TRANSPORTATION CHARGES ON SMALL DOMESTIC FREIGHT SHIPMENTS AND REDELEGATION OF AUTHORITY TO APPROVE USE OF COMMERCIAL PAPER

TO THE HEADS OF DEPARTMENTS, INDEPENDENT ESTABLISHMENTS, AND OTHERS CONCERNED:

THE GENERAL ACCOUNTING OFFICE CONCURS IN THE JOINT AGENCY TRANSPORTATION STUDY RECOMMENDATIONS THAT DEPARTMENTS, AGENCIES, AND OTHER ESTABLISHMENTS OF THE U. S. GOVERNMENT BE AUTHORIZED TO USE IMPREST FUNDS FOR THE PAYMENT OF TRANSPORTATION CHARGES NOT EXCEEDING $25 ON DOMESTIC FREIGHT SHIPMENTS MOVED ON COMMERCIAL BILLS OF LADING AND THAT HEADS OF DEPARTMENTS, AGENCIES, AND OTHER ESTABLISHMENTS BE PERMITTED TO REDELEGATE THEIR DISCRETIONARY AUTHORITY TO APPROVE THE USE OF COMMERCIAL FORMS AND PROCEDURES FOR SUCH SHIPMENTS.

BACKGROUND

IN FEBRUARY 1969, DISCRETIONARY AUTHORITY WAS GRANTED TO THE HEAD OF A DEPARTMENT, AGENCY, OR OTHER ESTABLISHMENT OF THE U. S. GOVERNMENT TO APPROVE, WHERE HE DETERMINED IT MORE EFFICIENT AND ECONOMICAL, THE USE OF COMMERCIAL FORMS AND PROCEDURES, RATHER THAN GOVERNMENT BILL OF LADING FORMS AND PROCEDURES, IN PROCURING TRANSPORTATION FOR PARTICULAR TYPES OF SMALL SHIPMENTS. THIS AUTHORITY WAS SUBJECT TO CERTAIN RESTRICTIONS, THE MAJOR ONE BEING THAT THE TRANSPORTATION CHARGES ORDINARILY NOT EXCEED $25 PER SHIPMENT.

THIS USE OF COMMERCIAL PAPER ON SMALL SHIPMENTS STIMULATED AN INTEREST IN SIMPLIFYING PROCEDURES FOR PAYING THE RELATED TRANSPORTATION CHARGES. INTERESTED AGENCIES HANDLED A LARGE NUMBER OF SMALL SHIPMENTS WITH FREIGHT CHARGES GENERALLY UNDER $25 AND IN MOST INSTANCES IN SUCH SMALL DOLLAR AMOUNTS THAT IT APPEARED UNECONOMICAL TO FOLLOW ESTABLISHED BILLING AND PAYMENT PROCEDURES.

ADVANTAGE OF CASH PAYMENT

THE CASH PAYMENT OF TRANSPORTATION CHARGES FOR SMALL SHIPMENTS IS A NATURAL EXTENSION OF THE USE OF COMMERCIAL FORMS AND PROCEDURES. THE USE OF CASH SHOULD MATERIALLY REDUCE THE PAPER WORK OF BOTH THE GOVERNMENT AND THE CARRIER INDUSTRY SINCE THERE WOULD BE NO NEED FOR THE PREPARATION OF GOVERNMENT BILL OF LADING FORMS OR THE PUBLIC VOUCHER FOR TRANSPORTATION CHARGES; THE DETAILED PROCESSING OF CARRIER VOUCHERS FOR PAYMENT; AND THE ISSUANCE AND MAILING OF CHECKS.

APPLICATION OF PROCEDURES

DEPARTMENTS, AGENCIES, AND OTHER ESTABLISHMENTS THAT UTILIZE THE ABOVE- CITED AUTHORITY TO APPROVE THE USE OF COMMERCIAL PAPER ON SMALL SHIPMENTS HAVING TRANSPORTATION CHARGES NOT EXCEEDING $25 ARE HEREBY AUTHORIZED TO MAKE PAYMENT OF THOSE CHARGES FROM IMPREST FUNDS. THESE PAYMENTS SHALL BE BASED ON THE USE OF THE COMMERCIAL FORMS AND PROCEDURES CURRENTLY PRESCRIBED IN 5 GAO 3017 AND SUBJECT TO THE FOLLOWING FURTHER LIMITATIONS.

1. ADOPTION OF THE CASH PAYMENT PROCEDURE SHALL BE OPTIONAL WITH THE DEPARTMENT, AGENCY, OR ESTABLISHMENT AND MUST BE CONCURRED IN BY THE CARRIER INVOLVED.

2. IMPREST FUNDS SHALL NOT BE USED TO PAY FOR INTERNATIONAL SHIPMENTS AND FOR HOUSEHOLD GOODS VAN SHIPMENTS.

3. PAYMENT OF FREIGHT CHARGES PRIOR TO PERFORMANCE OF THE SERVICE IS PROHIBITED UNDER CURRENT LEGISLATION. HOWEVER, IF LEGISLATION IS ENACTED, AS RECOMMENDED BY THE JOINT AGENCY TRANSPORTATION STUDY, TO EXEMPT TRANSPORTATION PAYMENTS FROM THE SCOPE OF THE STATUTE PROHIBITING ADVANCE PAYMENT (31 U.S.C. 529), THE GENERAL ACCOUNTING OFFICE WILL CIRCULARIZE INSTRUCTIONS COVERING THE AUTHORITY TO PREPAY FREIGHT CHARGES FOR SMALL SHIPMENTS.

4. THE IMPREST FUND DISBURSEMENTS FOR TRANSPORTATION SPECIFIED HEREIN SHALL GENERALLY BE MADE IN ACCORDANCE WITH THE PROVISIONS OF 7 GAO 27.

IN ADDITION, AUTHORITY IS GRANTED TO THE HEAD OF A DEPARTMENT, AGENCY, OR OTHER ESTABLISHMENT TO REDELEGATE TO SUCH OFFICIAL OR OFFICIALS AS HE MAY DESIGNATE WITHIN HIS ORGANIZATION THE AUTHORITY TO APPROVE THE USE, WHERE DETERMINED MORE EFFICIENT AND ECONOMICAL, OF COMMERCIAL FORMS AND PROCEDURES FOR SMALL FREIGHT SHIPMENTS ON WHICH THE TRANSPORTATION CHARGES DO NOT EXCEED $25. THE REDELEGATED AUTHORITY ALSO SHALL BE SUBJECT TO THE LIMITATIONS AND PROCEDURES CURRENTLY STATED IN 5 GAO 3017.

THIS REDELEGATION OF AUTHORITY SHOULD RELIEVE AGENCY HEADS AND INTERVENING LAYERS OF THE PAPER WORK BURDEN INVOLVED IN APPROVING THIS USE OF COMMERCIAL PAPER AND PLACE THE DECISIONMAKING AUTHORITY CLOSER TO THE SHIPPING ACTIVITIES WHERE THE BENEFITS AND ECONOMIES INHERENT IN THE USE OF SUCH FORMS AND PROCEDURES ARE MOST APPARENT.

JANUARY 7, 1974

HEADS OF DEPARTMENTS, AGENCIES, AND OTHERS CONCERNED:

SUBJECT: ADVANCE PAYMENT OF FREIGHT TRANSPORTATION CHARGES FROM IMPREST FUNDS

THE TRANSPORTATION PAYMENT ACT OF 1972, 86 STAT. 1163, AMENDED SECTION 322 OF THE TRANSPORTATION ACT OF 1940, AS AMENDED (49 U.S.C. 66), BY ADDING THE FOLLOWING NEW SUBSECTION TO THE SECTION:

"(B) PURSUANT TO REGULATIONS PRESCRIBED BY THE HEAD OF A GOVERNMENT AGENCY OR HIS DESIGNEE AND IN CONFORMITY WITH SUCH STANDARDS AS SHALL BE PROMULGATED JOINTLY BY THE SECRETARY OF THE TREASURY AND THE COMPTROLLER GENERAL OF THE UNITED STATES, BILLS FOR PASSENGER OR FREIGHT TRANSPORTATION SERVICES TO BE FURNISHED THE UNITED STATES BY ANY CARRIER OR FORWARDER MAY BE PAID IN ADVANCE OF COMPLETION OF THE SERVICES, WITHOUT REGARD TO SECTION 3648 OF THE REVISED STATUTES, AS AMENDED (31 U.S.C. 529): PROVIDED, THAT OF LADING, OR EQUIVALENT DOCUMENT COVERING THE SERVICE INVOLVED, SUCH CARRIER OR FORWARDER HAS ISSUED THE USUAL TICKET, RECEIPT, BILL SUBJECT TO LATER RECOVERY BY DEDUCTION OR OTHERWISE OF ANY PAYMENTS MADE FOR ANY SERVICES NOT RECEIVED AS ORDERED BY THE UNITED STATES."

JOINT STANDARDS FOR THE PAYMENT OF CHARGES FOR TRANSPORTATION ON BEHALF OF THE UNITED STATES WERE ISSUED ON NOVEMBER 5, 1973 (4 CFR 56).

AUTHORITY IS THEREFORE GRANTED TO THE DEPARTMENT, AGENCY, OR OTHER ESTABLISHMENT THAT UTILIZES THE DISCRETIONARY AUTHORITY OUTLINED IN 5 GAO 3017, AND/OR THE CIRCULAR LETTER DATED MAY 6, 1971 (B-163758), FOR THE USE OF COMMERCIAL FORMS AND PROCEDURES IN PROCURING TRANSPORTATION SERVICE FOR CERTAIN TYPES OF SMALL SHIPMENTS AND FOR THE PAYMENT OF CHARGES FOR THAT SERVICE FROM IMPREST FUNDS TO MAKE SUCH PAYMENT IN CASH AT ORIGIN OR DESTINATION IN ADVANCE OF COMPLETION OF SERVICE UPON PRESENTATION BY THE CARRIER OR FORWARDER OF THE PROPER DOCUMENT AS CITED ABOVE. HOWEVER, THOSE BILLS OF PAYEES DEFINED IN 4 CFR 56.4 SHALL NOT BE PAID UPON PRESENTATION UNLESS, AFTER REVIEW OF THE FACTS AND IN THE ABSENCE OF OBJECTION BY THE GENERAL ACCOUNTING OFFICE, IT IS DETERMINED ADMINISTRATIVELY THAT THE BEST INTERESTS OF THE UNITED STATES WILL NOT BE JEOPARDIZED BY SUCH PAYMENT.

THIS AUTHORITY TO MAKE ADVANCE PAYMENT OF FREIGHT TRANSPORTATION CHARGES SHALL BE APPLICABLE ONLY TO SHIPMENTS MADE IN ACCORDANCE WITH THOSE LIMITATIONS AND PROCEDURES STATED IN 5 GAO 3017, AS AMENDED, THAT ARE NOT SUPERSEDED BY THIS LETTER. ALSO, THE USE OF CASH FOR THIS PURPOSE SHALL BE OPTIONAL AND SHALL BE IMPLEMENTED ONLY UPON MUTUAL AGREEMENT BETWEEN THE AGENCY AND THE CARRIER OR FORWARDER INVOLVED. FURTHER, IT IS INCUMBENT UPON EACH DEPARTMENT, AGENCY, OR OTHER ESTABLISHMENT THAT PROPOSES TO UTILIZE THIS AUTHORITY TO DEVELOP SUFFICIENT CONTROLS AND PROCEDURES TO PRECLUDE DUPLICATE PAYMENTS.