A-11673, NOVEMBER 18, 1925, 5 COMP. GEN. 355

A-11673: Nov 18, 1925

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THE EXECUTION OF A LEASE FOR A TERM IN EXCESS OF THE FISCAL YEAR IS NOT AUTHORIZED. REQUESTING DECISION WHETHER YOU ARE AUTHORIZED TO ENTER INTO A LEASE OF A BUILDING AT TAIHOKU. IT IS EXPLAINED IN SUBMISSION THAT THE PRESENT QUARTERS ARE IN BAD CONDITION AND UNSAFE FOR OCCUPANCY AND THAT NEGOTIATIONS HAVE BEEN ENTERED INTO FOR THE CONSTRUCTION OF A BUILDING TO MEET THE NEEDS OF THE CONSULATE BUT THAT THE PROSPECTIVE LESSORS WILL NOT AGREE TO A LEASE FOR ONE YEAR WITH OPTION TO RENEW FOR NINE YEARS ADDITIONAL. PROVIDES THAT NO CONTRACT ON BEHALF OF THE UNITED STATES SHALL BE MADE UNLESS THE SAME IS AUTHORIZED BY LAW OR IS UNDER AN APPROPRIATION ADEQUATE TO ITS FULFILLMENT. OR INVOLVE THE GOVERNMENT IN ANY CONTRACT OR OTHER OBLIGATION FOR THE FUTURE PAYMENT OF MONEY IN EXCESS OF SUCH APPROPRIATIONS UNLESS SUCH CONTRACT OR OBLIGATION IS AUTHORIZED BY LAW. * * * IT HAS BEEN REPEATEDLY HELD BOTH BY THIS OFFICE AND BY THE COURTS THAT A LEASE EXECUTED BY OR IN BEHALF OF THE UNITED STATES FOR A TERM OF YEARS.

A-11673, NOVEMBER 18, 1925, 5 COMP. GEN. 355

LEASES - TERMINATION AT END OF FISCAL YEAR AS SECTION 3679, REVISED STATUTES, AS AMENDED, RESTRICTS THE EXPENDITURES OF GOVERNMENT DEPARTMENTS OR ESTABLISHMENTS TO THE APPROPRIATIONS FOR THE FISCAL YEAR CURRENT AND PROHIBITS THE EXECUTION OF ANY CONTRACT OR OTHER OBLIGATION FOR THE FUTURE PAYMENT OF MONEY BY THE UNITED STATES IN EXCESS OF THE APPROPRIATIONS MADE FOR THE PARTICULAR FISCAL YEAR, THE EXECUTION OF A LEASE FOR A TERM IN EXCESS OF THE FISCAL YEAR IS NOT AUTHORIZED. SUCH A LEASE WOULD BE CONSTRUED AS BINDING ONLY FOR THE FISCAL YEAR CURRENT WITH AN OPTION OF RENEWAL FROM YEAR TO YEAR TO THE END OF THE TERM.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF STATE, NOVEMBER 18, 1925:

THERE HAS BEEN RECEIVED YOUR LETTER OF OCTOBER 23, 1925, REQUESTING DECISION WHETHER YOU ARE AUTHORIZED TO ENTER INTO A LEASE OF A BUILDING AT TAIHOKU, TAIWAN, FOR USE OF THE CONSULATE, EXTENDING FOR A TERM OF 10 YEARS WITH PRIVILEGE OF RENEWAL. IT IS EXPLAINED IN SUBMISSION THAT THE PRESENT QUARTERS ARE IN BAD CONDITION AND UNSAFE FOR OCCUPANCY AND THAT NEGOTIATIONS HAVE BEEN ENTERED INTO FOR THE CONSTRUCTION OF A BUILDING TO MEET THE NEEDS OF THE CONSULATE BUT THAT THE PROSPECTIVE LESSORS WILL NOT AGREE TO A LEASE FOR ONE YEAR WITH OPTION TO RENEW FOR NINE YEARS ADDITIONAL, BEING UNDISPOSED TO ERECT A BUILDING UNSUITED TO NATIVE PURPOSES SO LONG AS THERE EXISTS ANY DOUBT AS TO THE DURATION OF THE LEASE.

SECTION 3732, REVISED STATUTES, PROVIDES THAT NO CONTRACT ON BEHALF OF THE UNITED STATES SHALL BE MADE UNLESS THE SAME IS AUTHORIZED BY LAW OR IS UNDER AN APPROPRIATION ADEQUATE TO ITS FULFILLMENT, EXCEPT IN THE WAR AND NAVY DEPARTMENTS IN CERTAIN CASES. SECTION 3679, REVISED STATUTES, AS AMENDED BY THE ACT OF MARCH 3, 1905, 33 STAT. 1257, AND THE ACT OF FEBRUARY 27, 1906, 34 STAT. 48, CONTAINS THE FOLLOWING PROVISION:

NO EXECUTIVE DEPARTMENT OR OTHER GOVERNMENT ESTABLISHMENT OF THE UNITED STATES SHALL EXPEND, IN ANY ONE FISCAL YEAR, ANY SUM IN EXCESS OF APPROPRIATIONS MADE BY CONGRESS FOR THAT FISCAL YEAR, OR INVOLVE THE GOVERNMENT IN ANY CONTRACT OR OTHER OBLIGATION FOR THE FUTURE PAYMENT OF MONEY IN EXCESS OF SUCH APPROPRIATIONS UNLESS SUCH CONTRACT OR OBLIGATION IS AUTHORIZED BY LAW. * * *

IT HAS BEEN REPEATEDLY HELD BOTH BY THIS OFFICE AND BY THE COURTS THAT A LEASE EXECUTED BY OR IN BEHALF OF THE UNITED STATES FOR A TERM OF YEARS, IN THE ABSENCE OF SPECIFIC STATUTORY AUTHORITY THEREFOR, IS BINDING UPON THE UNITED STATES ONLY TO THE END OF THE FISCAL YEAR WITH AN OPTION IN THE GOVERNMENT OF RENEWAL FROM YEAR TO YEAR UNTIL THE END OF THE TERM. COMP. GEN. 10; CHASE V. UNITED STATES, 155 U.S. 489; BRADLEY V. UNITED STATES, 98 U.S. 104; UNITED STATES V. DOULLUT, 213 FED.REP. 729; REED SMOOT V. UNITED STATES, 38 CT.CLS. 418. IT IS OF COURSE NEEDLESS TO SUGGEST TO YOU THE COMPLICATIONS WHICH MIGHT ARISE FROM THE EXECUTION OF A LEASE OR CONTRACT WITH THE SUBJECT OF A FOREIGN COUNTRY CONTRARY TO THE LAWS OF THE UNITED STATES SHOULD CONGRESS FAIL OR REFUSE TO APPROPRIATE THE FUNDS NECESSARY FOR ITS FULFILLMENT. SEE ALSO SECTION 312 (C) OF THE BUDGET AND ACCOUNTING ACT OF 1921, 42 STAT. 26.

ANSWERING YOUR QUESTION SPECIFICALLY, I HAVE TO ADVISE THAT YOU ARE NOT AUTHORIZED TO EXECUTE, OR CAUSE TO BE EXECUTED, A LEASE BY OR ON BEHALF OF THE UNITED STATES FOR A TERM IN EXCESS OF ONE FISCAL YEAR, ALTHOUGH A LEASE SO MADE MAY PROPERLY CONTAIN PROVISIONS FOR RENEWAL FROM YEAR TO YEAR AT THE OPTION OF THE UNITED STATES CONDITIONED UPON APPROPRIATIONS BEING MADE AVAILABLE FOR THE RENTAL THEREOF.