A-30971, MARCH 25, 1930, 9 COMP. GEN. 415

A-30971: Mar 25, 1930

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

PUBLIC PROPERTY - LOAN OF - DEPRECIATION WHERE EQUIPMENT OF ONE GOVERNMENTAL AGENCY IS BORROWED AND USED BY ANOTHER GOVERNMENTAL AGENCY THERE IS NO AUTHORITY OF LAW TO DEMAND A RETURN OR COMPENSATION BASED UPON THE USE ALONE. HENCE REIMBURSEMENT FOR USE AND DEPRECIATION OF SUCH PROPERTY IS NOT AUTHORIZED. 3 COMP. 1930: I HAVE YOUR LETTER OF MARCH 11. FROM TIME TO TIME FUNDS HAVE BEEN TRANSFERRED UNDER THIS AGREEMENT TO COVER PERSONAL SERVICES. MOST OF THE CONSTRUCTION WORK IS HANDLED UNDER CONTRACTS ENTERED INTO FOLLOWING RECEIPT OF COMPETITIVE BIDS. IN ORDER TO SECURE ACCURATE COST RECORDS ON INDIVIDUAL FOREST ROAD PROJECTS ON WHICH EQUIPMENT IS USED. A TRANSFER OF DISBURSEMENTS IN AN AMOUNT AGGREGATING THE ACTUAL EQUIPMENT HANDLING AND REPAIR COSTS PLUS ESTIMATED DEPRECIATION DUE TO USE ON THE PROJECT IS MADE FROM THE GENERAL EQUIPMENT ACCOUNT TO THE PARTICULAR PROJECT ACCOUNT.

A-30971, MARCH 25, 1930, 9 COMP. GEN. 415

PUBLIC PROPERTY - LOAN OF - DEPRECIATION WHERE EQUIPMENT OF ONE GOVERNMENTAL AGENCY IS BORROWED AND USED BY ANOTHER GOVERNMENTAL AGENCY THERE IS NO AUTHORITY OF LAW TO DEMAND A RETURN OR COMPENSATION BASED UPON THE USE ALONE, HENCE REIMBURSEMENT FOR USE AND DEPRECIATION OF SUCH PROPERTY IS NOT AUTHORIZED. 3 COMP. GEN. 74 DISTINGUISHED.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF AGRICULTURE, MARCH 25, 1930:

I HAVE YOUR LETTER OF MARCH 11, 1930, AS FOLLOWS:

FOR SEVERAL YEARS, ACTING UNDER AN INTERDEPARTMENTAL AGREEMENT, THE BUREAU OF PUBLIC ROADS OF THIS DEPARTMENT HAS BEEN RENDERING ENGINEERING SERVICES IN CONNECTION WITH THE SURVEY, CONSTRUCTION, MAINTENANCE AND IMPROVEMENT OF ROADS WITHIN NATIONAL PARKS AND MONUMENTS. FROM TIME TO TIME FUNDS HAVE BEEN TRANSFERRED UNDER THIS AGREEMENT TO COVER PERSONAL SERVICES, OPERATING EXPENSES, AND PURCHASE OF SUPPLIES.

MOST OF THE CONSTRUCTION WORK IS HANDLED UNDER CONTRACTS ENTERED INTO FOLLOWING RECEIPT OF COMPETITIVE BIDS, IN WHICH CASE THE CONTRACTORS PROVIDE THE NECESSARY EQUIPMENT. PRACTICALLY ALL OF THE MAINTENANCE WORK AND EMERGENCY WORK, SUCH AS REMOVAL OF SLIDES AND REPAIR OF WASHOUTS, HOWEVER, MUST BE HANDLED BY DAY LABOR FORCES UNDER THE SUPERVISION OF BUREAU OF PUBLIC ROADS ENGINEERS. THIS WORK REQUIRES ROAD-BUILDING EQUIPMENT, SUCH AS TRUCKS, STEAM SHOVELS, GRADERS, ETC.

THE BUREAU OF PUBLIC ROADS HAS ON HAND A LARGE AMOUNT OF ROAD BUILDING EQUIPMENT WHICH HAS BEEN PURCHASED FROM FOREST ROAD FUNDS FOR USE ON FOREST ROAD PROJECTS. IN ORDER TO SECURE ACCURATE COST RECORDS ON INDIVIDUAL FOREST ROAD PROJECTS ON WHICH EQUIPMENT IS USED, A TRANSFER OF DISBURSEMENTS IN AN AMOUNT AGGREGATING THE ACTUAL EQUIPMENT HANDLING AND REPAIR COSTS PLUS ESTIMATED DEPRECIATION DUE TO USE ON THE PROJECT IS MADE FROM THE GENERAL EQUIPMENT ACCOUNT TO THE PARTICULAR PROJECT ACCOUNT; NO ADJUSTMENT BETWEEN APPROPRIATIONS BEING INVOLVED.

IT FREQUENTLY HAPPENS THAT A PIECE OF EQUIPMENT PURCHASED FROM FOREST ROAD FUNDS IS NOT REQUIRED AT THE TIME ON A FOREST PROJECT BUT CAN BE USED TO ADVANTAGE ON A PARK PROJECT. UNDER SUCH CIRCUMSTANCES IT WOULD APPEAR DESIRABLE THAT SUCH EQUIPMENT BE USED, THEREBY ELIMINATING THE NECESSITY FOR THE PURCHASE OF SIMILAR EQUIPMENT FROM PARK ROAD FUNDS. IF THIS IS DONE, HOWEVER, THE LIFE OF THE EQUIPMENT IS APPRECIABLY SHORTENED, WHICH MEANS THAT IT WOULD HAVE TO BE REPLACED AT AN EARLIER DATE THAN IF NOT USED ON THE PARK PROJECT. IN THE INTEREST OF GOVERNMENTAL ECONOMY IT IS DESIRABLE TO HAVE ON HAND ONLY THE MINIMUM AMOUNT OF ROAD-BUILDING EQUIPMENT REQUIRED TO HANDLE FOREST AND PARK ROAD WORK, AND TO COVER THE COST BY AN EQUITABLE ADJUSTMENT BETWEEN FUNDS, DEPENDING ON THE USE OF SUCH EQUIPMENT. THE CHARGE AGAINST PARK ROAD FUNDS WOULD BE ACCOMPLISHED THROUGH A TRANSFER VOUCHER DEBITING THE PARK ROAD APPROPRIATION AND CREDITING THE FOREST ROAD FUNDS WITH THE AMOUNT OF THE EQUIPMENT CHARGES AGAINST EACH PARK ROAD PROJECT ON WHICH EQUIPMENT WAS USED. THIS WOULD NOT RESULT IN AUGMENTING THE FOREST ROAD FUNDS, BUT WOULD PROVIDE THAT THE PARK ROAD FUNDS BEAR THE PROPER SHARE OF THE COST OF EQUIPMENT USED ON PARK ROAD WORK.

WHILE IT WOULD APPEAR FROM CERTAIN DECISIONS OF YOUR OFFICE THAT AN ADJUSTMENT BETWEEN APPROPRIATIONS TO COVER DEPRECIATION ON EQUIPMENT IS NOT AUTHORIZED, THE PROCEDURE WHICH WE DESIRE SEEMS TO BE MORE APPROPRIATELY COVERED BY THE FOLLOWING DECISION (3 COMP. GEN. 74, 974), WHICH PROVIDES THAT "THE PERFORMANCE OF WORK BY ONE DEPARTMENT FOR ANOTHER DEPARTMENT, WITHOUT REIMBURSING THE WHOLE ADDITIONAL COST OF SUCH WORK AS ACCURATELY AS IT MAY REASONABLY BE ASCERTAINED, WOULD CONTRAVENE THE REQUIREMENTS OF LAW IN THAT IT WOULD AUGMENT ONE APPROPRIATION AT THE EXPENSE OF ANOTHER.'

IT WILL BE APPRECIATED, THEREFORE, IF YOU WILL ADVISE WHETHER, UNDER THE CIRCUMSTANCES OUTLINED, A DEPRECIATION CHARGE MAY BE MADE AGAINST THE APPROPRIATIONS FOR ROAD WORK IN THE NATIONAL PARKS TO BE PRORATED ACCORDING TO THE USE MADE OF EQUIPMENT AND SUPPLIES OF THE BUREAU OF PUBLIC ROADS, THE AMOUNT OF SUCH DEPRECIATION CHARGE TO BE TRANSFERRED TO THIS DEPARTMENT AND CREDITED TO THE APPROPRIATIONS FOR ROAD WORK WITHIN NATIONAL FOREST, FROM WHICH APPROPRIATIONS THE EQUIPMENT AND SUPPLIES SO USED WERE PURCHASED.

THE MATTER OF CHARGING FOR THE USE AND DEPRECIATION OF PUBLIC PROPERTY OF ONE GOVERNMENTAL AGENCY USED BY ANOTHER WAS RECENTLY DISCUSSED BY THIS OFFICE IN DECISION 8 COMP. GEN. 600, AND THE HOLDING WAS TO THE EFFECT THAT SUCH CHARGING WAS NOT AUTHORIZED, CITING AS PRECEDENTS 25 COMP. DEC. 682; 5 COMP. GEN. 162. WITH RESPECT TO THE DECISION 3 COMP. GEN. 74, CITED IN YOUR LETTER, IT WAS SAID IN THE RECENT DECISION:

THE DECISION, 3 COMP. GEN. 74, CITED IN YOUR SUBMISSION AS A BASIS FOR THE PROPOSED CHARGING OF APPROPRIATIONS OF BUREAUS AND ESTABLISHMENTS FOR WHICH THE GEOLOGICAL SURVEY PERFORMS SCIENTIFIC OR TECHNICAL INVESTIGATIONS, IS AN EXCEPTION TO THE GENERAL RULE BASED UPON THE THEORY THAT AS THE RECLAMATION FUND IS A REIMBURSABLE APPROPRIATION, THE EQUIPMENT ACQUIRED THEREUNDER REPRESENTS AN ASSET WHICH SHOULD NOT BE PERMITTED TO BE DEPRECIATED FROM USE OF OTHER THAN OBJECTS FOR WHICH THE FUND WAS CREATED. NO SUCH SITUATION IS PRESENTED WITH RESPECT TO PROPERTY AND EQUIPMENT OF THE GEOLOGICAL SURVEY. THE APPROPRIATIONS FOR THE SURVEY ARE ANNUAL APPROPRIATIONS MADE FOR THE NEED OF THE SERVICE FOR EACH FISCAL YEAR AND, NO DOUBT, AS A RULE, THE DEPRECIATION OF PASSENGER CARRYING VEHICLES OCCURS LARGELY IN FISCAL YEARS SUBSEQUENT TO THAT IN WHICH THE VEHICLES WERE ACQUIRED.

NO REASON APPEARS WHY THE SAME RULE SHOULD NOT APPLY TO THE MATTER SUBMITTED BY YOU, EVEN THOUGH THE FOREST ROAD APPROPRIATIONS MAY BE NO YEAR APPROPRIATIONS. IT MAY BE STATED IN THIS CONNECTION THAT THE MATTER QUOTED IN YOUR LETTER DOES NOT APPEAR IN THE DECISION CITED AS 3 COMP. GEN. 74. THAT DECISION WAS WITH RESPECT TO THE USE BY A GOVERNMENTAL AGENCY OF EQUIPMENT PURCHASED FROM THE RECLAMATION FUND, WHEREAS THE MATTER QUOTED IN YOUR LETTER APPEARS TO RELATE TO WORK PERFORMED BY ONE DEPARTMENT OF THE GOVERNMENT FOR ANOTHER.

IN SPECIFIC ANSWER TO THE QUESTION SUBMITTED BY YOU I HAVE TO ADVISE THAT THERE IS NO AUTHORITY OF LAW FOR THE CHARGING OF APPROPRIATIONS FOR THE NATIONAL PARKS OR OTHER SERVICES FOR THE USE AND/OR DEPRECIATION ON PROPERTY OF THE BUREAU OF PUBLIC ROADS BORROWED AND USED BY SUCH SERVICE.