B-104354, SEPTEMBER 12, 1951, 31 COMP. GEN. 83

B-104354, SEPTEMBER 12, 1951, 31 COMP. GEN. 83

APPROPRIATIONS - OBLIGATION LIMITATION FOR INTERDEPARTMENTAL SERVICES - ACT OF SEPTEMBER 6, 1950 IN VIEW OF THE LAST PROVISO OF SECTION 1210, ACT OF SEPTEMBER 6, 1950, WHICH RESTRICTS THE USE OF FUNDS WITHDRAWN FROM ONE APPROPRIATION FOR CREDIT TO ANOTHER, UNDER SECTION 601 OF THE ACT OF JUNE 30, 1932, TO THE PERIOD PROVIDED BY THE APPROPRIATING ACT, AN ORDER FOR WORK OR SERVICE PLACED BY ONE AGENCY WITH ANOTHER NO LONGER OBLIGATES THE APPROPRIATION OF THE ORDERING AGENCY IN THE SAME MANNER AS ORDERS OR CONTRACTS PLACED WITH PRIVATE CONTRACTORS AND THEREFORE, WORK OR SERVICE COVERING MORE THAN ONE FISCAL YEAR IS TO BE CHARGED TO THE APPROPRIATION FOR THE FISCAL YEAR IN WHICH THE WORK IS PERFORMED OR THE SERVICE IS RENDERED. UNDER THE LAST PROVISO OF SECTION 1210, ACT OF SEPTEMBER 6, 1950, WHICH RESTRICTS THE USE OF FUNDS WITHDRAWN FROM ONE APPROPRIATION FOR CREDIT TO ANOTHER PURSUANT TO SECTION 601 OF THE ACT OF JUNE 30, 1932, TO THE PERIOD PROVIDED BY THE APPROPRIATING ACT, THERE IS NOT DISTINCTION BETWEEN PAYMENTS IN ADVANCE AND REIMBURSEMENT FOR WORK PERFORMED OR SERVICES RENDERED BY ONE AGENCY FOR ANOTHER, SO THAT FUNDS TRANSFERRED TO AN AGENCY AS REIMBURSEMENT FOR SUCH WORK OR SERVICE ARE NOT AVAILABLE FOR ANY PERIOD BEYOND THAT PROVIDED BY THE ACT APPROPRIATING THE FUNDS. UNDER THE LAST PROVISO OF SECTION 1210 OF THE ACT OF SEPTEMBER 6, 1950, WHICH RESTRICTS THE USE OF FUNDS WITHDRAWN FROM ONE APPROPRIATION FOR CREDIT TO ANOTHER PURSUANT TO SECTION 601 OF THE ACT OF JUNE 30, 1932, TO THE PERIOD PROVIDED BY THE APPROPRIATING ACT, THE REIMBURSEMENT TO AN AGENCY FOR SERVICES PERFORMED FOR ANOTHER, WHERE THE ORDER IS PLACED, SERVICE PERFORMED AND REIMBURSEMENT TO A MULTIPLE YEAR APPROPRIATION ALL OCCUR DURING ONE FISCAL YEAR, ASSUMES THE LIFE OF THE MULTIPLE YEAR APPROPRIATION.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF AGRICULTURE, SEPTEMBER 12, 1951:

REFERENCE IS MADE TO YOUR LETTER DATED JUNE 27, 1951, REQUESTING DECISION ON SEVERAL QUESTIONS CONCERNING THE EFFECT OF SECTION 1210 OF THE ACT OF SEPTEMBER 6, 1950, PUBLIC LAW 759, ON TRANSFERS OF FUNDS (1) UNDER AUTHORITY OF SECTION 601 OF THE ACT OF JUNE 30, 1932, AS AMENDED, 31 U.S.C. 686, AND (2) UNDER AUTHORITY OF THE ACTS OF JULY 12, 1943, 57 STAT. 393, 5 U.S.C. 542-1 AND SEPTEMBER 6, 1950, SUPRA, ESTABLISHING TWO WORKING CAPITAL FUNDS AVAILABLE TO THE DEPARTMENT OF AGRICULTURE FOR CENTRAL ADMINISTRATIVE SERVICES WITHIN THE DEPARTMENT AND FOR FACILITIES AND SERVICES FURNISHED BY THE AGRICULTURAL RESEARCH CENTER TO OTHER GOVERNMENT AGENCIES, RESPECTIVELY.

THE LETTER OF JUNE 27, 1951, STATES--- AND CORRECTLY SO--- THAT IT IS THE UNDERSTANDING OF YOUR DEPARTMENT THAT ADVANCE PAYMENTS MADE PURSUANT TO SECTION 601 OF THE 1932 ACT, IN THE LIGHT OF SECTION 1210 OF THE 1950 ACT, CANNOT BE OBLIGATED BY THE PERFORMING AGENCY SUBSEQUENT TO THE PERIOD PROVIDED BY THE APPROPRIATING ACT DURING WHICH THE ORDERING AGENCY COULD HAVE OBLIGATED THE FUNDS. HOWEVER, THE LETTER EXPRESSES THE FURTHER VIEW THAT REIMBURSEMENTS MADE PURSUANT TO SAID SECTION 601 OF THE 1932 ACT ARE NOT AFFECTED BY SECTION 1210 BUT INSTEAD ARE GOVERNED BY THE PROVISIONS OF THE APPROPRIATIONS TO WHICH THE REIMBURSEMENTS ARE CREDITED. IN THIS CONNECTION FOUR QUESTIONS ARE RAISED AS FOLLOWS:

1. DOES THE PLACING OF AN ORDER WITH A PERFORMING AGENCY CONTINUE TO OBLIGATE THE APPROPRIATION OF THE ORDERING AGENCY UNDER SUBSECTION (C) OF SECTION 601 OF THE ECONOMY ACT, AS IT DID PRIOR TO THE ENACTMENT OF SECTION 1210?

2. IN OUR GENERAL ACCOUNTING CONCEPTS, REIMBURSEMENTS ARE MERGED WITH AND BECOME A PART OF THE RECEIVING APPROPRIATION. THE LEGISLATIVE HISTORY, AS DISCUSSED BELOW, AND THE ESTABLISHED ACCOUNTING PRACTICE OF MERGING REIMBURSEMENTS, RAISES THE QUESTION WHETHER SECTION 1210 WAS INTENDED TO APPLY TO REIMBURSEMENTS. I SHOULD, THEREFORE, APPRECIATE AN ANSWER TO THE SPECIFIC QUESTION WHETHER SECTION 1210 LIMITS THE AVAILABILITY FOR THE OBLIGATING OF FUNDS TRANSFERRED FROM ONE APPROPRIATION TO ANOTHER BY MEANS OF REIMBURSEMENT, RATHER THAN ADVANCE PAYMENT, TO THE SAME PERIOD OF TIME AS THAT APPLICABLE TO THE APPROPRIATION FROM WHICH THE REIMBURSEMENT IS MADE.

3A. IF REIMBURSEMENTS ARE AFFECTED, BUT THE PLACING OF AN ORDER OBLIGATES THE ORDERING AGENCY'S APPROPRIATION, DOES A REIMBURSEMENT TO A MULTIPLE YEAR APPROPRIATION, FROM FUNDS OBLIGATED IN ONE FISCAL YEAR AND TRANSFERRED IN A SUBSEQUENT FISCAL YEAR, ASSUME THE LIFE OF THE MULTIPLE YEAR APPROPRIATION?

B. IF BOTH REIMBURSEMENTS AND THE OBLIGATING OF THE ORDERING AGENCY'S APPROPRIATION ARE AFFECTED, BUT THE ORDER IS PLACED, THE SERVICE IS PERFORMED, AND THE REIMBURSEMENT TO A MULTIPLE YEAR APPROPRIATION ALL OCCUR DURING ONE FISCAL YEAR, DOES THE REIMBURSEMENT ASSUME THE LIFE OF OF THE MULTIPLE YEAR APPROPRIATION?

SINCE THE LETTER DOES NOT PRESENT ANY FACTUAL CIRCUMSTANCES AND AS YOUR QUESTIONS ARE STATED IN GENERAL TERMS THE DECISION RENDERED HEREIN NECESSARILY WILL LIKEWISE BE STATED IN GENERAL TERMS.

SECTION 1210 OF THE ACT OF SEPTEMBER 6, 1950, PUBLIC LAW 759, 64 STAT. 765, READS AS FOLLOWS:

NO FUNDS MADE AVAILABLE BY THIS OR ANY OTHER ACT SHALL BE WITHDRAWN FROM ONE APPROPRIATION ACCOUNT FOR CREDIT TO ANOTHER, OR TO A WORKING FUND, EXCEPT AS AUTHORIZED BY LAW: PROVIDED, THAT, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED BY LAW, ANY FUNDS SO WITHDRAWN AND CREDITED SHALL BE AVAILABLE FOR THE SAME PURPOSES, AND SUBJECT TO THE SAME LIMITATIONS, CONDITIONS, AND RESTRICTIONS, AS PROVIDED BY THE ACT APPROPRIATING SUCH FUNDS: PROVIDED FURTHER, THAT ANY SUCH WITHDRAWAL AND CREDIT SHALL BE MADE, WITHOUT WARRANT ACTION, BY CHECK: PROVIDED FURTHER, THAT NO FUNDS WITHDRAWN AND CREDITED PURSUANT TO SECTION 601 OF THE ACT OF JUNE 30, 1932, AS AMENDED (47 STAT. 147: 31 U.S.C. 686), SHALL BE AVAILABLE FOR ANY PERIOD BEYOND THAT PROVIDED BY THE ACT APPROPRIATING SUCH FUNDS.

SECTION 601 OF THE ACT OF JUNE 30, 1932, AS AMENDED, 31 U.S.C. 686, PROVIDES IN PERTINENT PART, AS FOLLOWS:

(A) ANY EXECUTIVE DEPARTMENT OR INDEPENDENT ESTABLISHMENT OF THE GOVERNMENT, OR ANY BUREAU OR OFFICE THEREOF, IF FUNDS ARE AVAILABLE THEREFOR AND IF IT IS DETERMINED BY THE HEAD OF SUCH EXECUTIVE DEPARTMENT, ESTABLISHMENT, BUREAU, OR OFFICE TO BE IN THE INTEREST OF THE GOVERNMENT SO TO DO, MAY PLACE ORDERS WITH ANY OTHER SUCH DEPARTMENT, ESTABLISHMENT, BUREAU, OR OFFICE FOR MATERIALS, SUPPLIES, EQUIPMENT, WORK, OR SERVICES, OF ANY KIND THAT SUCH REQUISITIONED FEDERAL AGENCY MAY BE IN A POSITION TO SUPPLY OR EQUIPPED TO RENDER, AND SHALL PAY PROMPTLY BY CHECK TO SUCH FEDERAL AGENCY AS MAY BE REQUISITIONED UPON ITS WRITTEN REQUEST, EITHER IN ADVANCE OR UPON THE FURNISHING OR PERFORMANCE THEREOF, ALL OR PART OF THE ESTIMATED OR ACTUAL COST THEREOF AS DETERMINED BY SUCH DEPARTMENT, ESTABLISHMENT, BUREAU, OR OFFICE AS MAY BE REQUISITIONED * * *.

(C) ORDERS PLACED AS PROVIDED IN SUBSECTION (A) SHALL BE CONSIDERED AS OBLIGATIONS UPON APPROPRIATIONS IN THE SAME MANNER AS ORDERS OR CONTRACTS PLACED WITH PRIVATE CONTRACTORS. ADVANCE PAYMENTS CREDITED TO SPECIAL WORKING FUNDS SHALL REMAIN AVAILABLE TO THE PROCURING AGENCY FOR ENTERING INTO CONTRACTS AND OTHER USES DURING THE FISCAL YEAR OR YEARS FOR WHICH THE APPROPRIATION INVOLVED WAS MADE AND THEREAFTER UNTIL SAID APPROPRIATION LAPSES UNDER THE LAW TO THE SURPLUS FUND OF THE TREASURY.

WHILE AS STATED IN YOUR LETTER THE LEGISLATIVE HISTORY OF SECTION 1210 EVIDENCES A SPECIFIC INTENT TO CURTAIL THE AVAILABILITY OF ADVANCES TO SPECIAL WORKING FUNDS--- HOUSE REPORT NO. 1797, PAGE 9, AND SENATE REPORT NO. 1941, PAGE 299, EIGHTY-FIRST CONGRESS, SECOND SESSION -- THE GENERAL PURPOSE OF THE LAST PROVISO IS MORE BROADLY STATED IN THE HOUSE REPORT AS "TO SO RESTRICT THE USE OF THE AUTHORITY CONTAINED IN SECTION 601 AS TO PREVENT CONTINUATION OF AVAILABILITY BEYOND THE PERIOD PROVIDED BY THE APPROPRIATING ACT" AND IN THE SENATE REPORT AS "THE PERFORMING AGENCY WILL BE IN THE SAME POSITION AS THE ORDERING AGENCY.' IT NECESSARILY FOLLOWS THAT THE EFFECT OF SUCH PROVISO IS NOT ONLY TO RESTRICT THE AVAILABILITY OF FUNDS OF THE ORDERING AGENCY TO THE PERIOD PROVIDED BY THE APPROPRIATING ACT BUT, ALSO, TO PLACE THE PERFORMING AGENCY IN THE SAME POSITION AS THE ORDERING AGENCY IN RESPECT TO THE OBLIGATION OF ITS OWN FUNDS IN CARRYING OUT SECTION 601 ORDERS. IN OTHER WORDS, FOR ALL INTENTS AND PURPOSES, SECTION 1210 SUPERSEDES SECTION 601 (C) OF THE 1932 ACT, AS AMENDED, SUPRA, SO THAT ORDERS PLACED AS PROVIDED IN SUBSECTION (A) NO LONGER MAY BE CONSIDERED AS OBLIGATIONS UPON APPROPRIATIONS IN THE SAME MANNER AS ORDERS OR CONTRACTS PLACED WITH PRIVATE CONTRACTORS.

THE SITUATION PRESENTED WITH THE ENACTMENT OF SECTION 1210, SUPRA, IS IDENTICAL TO THAT WHICH AROSE IN 1936 UPON THE ENACTMENT OF SECTION 8 OF THE ACT OF JUNE 22, 1936, 49 STAT. 1648, WHICH PROVIDED AS FOLLOWS:

AFTER JUNE 30, 1936, ADVANCE PAYMENTS UNDER THE PROVISIONS OF TITLE VI, PART II, OF THE LEGISLATIVE APPROPRIATION ACT FOR THE FISCAL YEAR 1933, SHALL HAVE NO LONGER PERIOD OF AVAILABILITY FOR OBLIGATION THAN THE APPROPRIATION FROM WHICH SUCH ADVANCE PAYMENTS ARE MADE.

THE PERTINENT PRIOR LEGISLATION AS CONTAINED IN SECTION 601 (C) OF THE ACT OF JUNE 30, 1932, 47 STAT. 418, READS AS FOLLOWS:

ORDERS PLACED AS PROVIDED IN SUBSECTION (A) SHALL BE CONSIDERED AS OBLIGATIONS UPON APPROPRIATIONS IN THE SAME MANNER AS ORDERS OR CONTRACTS PLACED WITH PRIVATE CONTRACTORS. ADVANCE PAYMENTS CREDITED TO A SPECIAL WORKING FUND SHALL REMAIN AVAILABLE UNTIL EXPENDED.

BOTH THE THEN WAR DEPARTMENT AND THE NAVY DEPARTMENT HAD OCCASION TO RAISE THE QUESTION OF THE EFFECT OF SECTION 8 OF THE JUNE 22, 1936 ACT, SUPRA, ON THE PRIOR LEGISLATION, AND TWO DECISIONS--- 16 COMP. GEN. 575; ID. 752--- WERE RENDERED ON THE MATTER. THE LATTER DECISION, TO TH SECRETARY OF WAR AFTER REFERRING TO SECTION 8, SUPRA, HELD AS FOLLOWS:

UNDER THE PROVISIONS OF THIS SECTION, AFFECTING ALL ADVANCES MADE UNDER THE CITED LAW, IF THE APPROPRIATION FROM WHICH THE ADVANCE IS MADE IS NOT AVAILABLE FOR OBLIGATION EITHER BY ITS TERMS OR UNDER OTHER GENERAL OR SPECIAL STATUTE BEYOND THE END OF A CERTAIN FISCAL YEAR, THE FUNDS SO ADVANCED ARE NOT AVAILABLE BEYOND SUCH DATE. THIS, OF COURSE, OPERATED AS A REPEAL OF SECTION 601 (C) OF THE ACT OF JUNE 30, 1932 * * *.

SUBSEQUENTLY, BY THE ACT OF JUNE 26, 1943, 57 STAT. 219, SECTION 601 (C) WAS REENACTED AS HEREINBEFORE QUOTED. HOWEVER, WITH THE ENACTMENT OF SECTION 1210, SUPRA, THE SITUATION REVERTED TO THAT OBTAINING FOLLOWING THE ACT OF JUNE 22, 1936. ACCORDINGLY, WHAT WAS STATED IN 16 COMP. GEN. 752, SUPRA, IS EQUALLY FOR APPLICATION NOW. THAT BEING THE CASE, IT MUST BE HELD THAT, AT THE PRESENT TIME, WITH THE EFFECTIVE REPEAL OF SECTION 601 (C), THE PLACING OF AN ORDER BY ONE AGENCY WITH ANOTHER DOES NOT OBLIGATE THE APPROPRIATION OF THE FORMER AGENCY AS HERETOFORE. FURTHERMORE, SECTION 1210 MAKES NO DISTINCTION BETWEEN PAYMENTS IN ADVANCE AND BY WAY OF REIMBURSEMENT, IT PROVIDING THAT FUNDS WITHDRAWN AND CREDITED SHALL NOT BE AVAILABLE FOR ANY PERIOD BEYOND THAT PROVIDED BY THE ACT APPROPRIATING THE FUNDS. ACCORDINGLY, WHERE WORK IS PERFORMED OR SERVICES RENDERED ON A REIMBURSABLE BASIS BY ONE AGENCY FOR ANOTHER OVER A PERIOD COVERING MORE THAN ONE FISCAL YEAR, THE RESPECTIVE ANNUAL APPROPRIATIONS OF THE SERVICED AGENCY MUST BE CHARGED PRO TANTO WITH THE WORK PERFORMED OR SERVICES RENDERED IN THE PARTICULAR FISCAL YEAR. IN THE LIGHT OF THE FOREGOING, QUESTION 1 IS ANSWERED IN THE NEGATIVE AND QUESTION 2 IN THE AFFIRMATIVE.

INASMUCH AS QUESTION 3A IS PREDICATED ON THE ASSUMPTION THAT THE PLACING OF AN ORDER OBLIGATES THE ORDERING AGENCY'S APPROPRIATION IN THE SAME MANNER AS ORDERS PLACED WITH PRIVATE CONTRACTORS, AND SINCE IT HEREINBEFORE HAS BEEN STATED THAT THE ORDERING ACTION DOES NOT ACCOMPLISH THAT PURPOSE, AN ANSWER TO SAID QUESTION IS NOT REQUIRED.

QUESTION 3B IS ANSWERED IN THE AFFIRMATIVE.

WITH REFERENCE TO THE VIEW EXPRESSED IN YOUR LETTER THAT SECTION 1210 OF THE 1950 ACT HAS NO EFFECT ON REIMBURSEMENTS TO THE WORKING CAPITAL FUNDS ESTABLISHED IN THE DEPARTMENT OF AGRICULTURE BY THE ACTS OF 1943 AND 1950 CITED ABOVE, EACH OF SAID ACTS EXPRESSLY PROVIDES DEFINITE AMOUNTS AS WORKING CAPITAL FOR OPERATION OF THE FUNDS TO REMAIN AVAILABLE UNTIL EXPENDED AND THAT SUCH FUNDS SHALL BE REIMBURSED FROM APPLICABLE APPROPRIATIONS OR FUNDS FOR THE FACILITIES OR SERVICES FURNISHED THEREUNDER. AS THUS CONSTITUTED THE FUNDS ARE EACH CLOTHED WITH THE CHARACTERISTICS OF A SELF-SUSTAINING REVOLVING FUND, REQUIRING NO ADDITIONAL AUTHORITY OF LAW FOR THE TRANSFER OF MONEYS USED TO REIMBURSE THE WORKING CAPITAL EXPENDED IN THE COURSE OF OPERATIONS. SINCE THE FOREGOING REIMBURSEMENT AND AVAILABILITY UNTIL EXPENDED AUTHORITIES ARE SPECIFICALLY PROVIDED IN THE ACTS OF 1943 AND 1950, REIMBURSEMENTS TO THE INVOLVED WORKING CAPITAL FUNDS DO NOT COME WITHIN THE PURVIEW OF SECTION 601 OF THE 1932 ACT, AS AMENDED, AND, THEREFORE, ARE NOT AFFECTED BY THE LAST PROVISO TO SECTION 1210 OF THE 1950 ACT.