Budget Issues:

The Use of Spending Authority and Permanent Appropriations Is Widespread

AFMD-87-44: Published: Jul 17, 1987. Publicly Released: Jul 17, 1987.

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In accordance with a legislative requirement, GAO summarized and provided observations on its inventory of budget accounts with spending authority and permanent appropriations.

GAO found that 65 federal entities finance 413 accounts with permanent appropriations or spending authority, including: (1) 59 accounts with contract authority; (2) 37 accounts with authority to borrow; (3) 27 accounts with authority to use monetary credits or bartering; (4) 263 accounts authorized to make payments with offsetting collections from nonfederal sources; and (5) 143 accounts with permanent appropriations primarily related to entitlements. GAO also found that: (1) 278 accounts had spending authority or permanent appropriations in fiscal year (FY) 1967 and continued to do so in FY 1987; (2) the total amount of spending authority and permanent appropriations in by these accounts increased by about 161 percent, adjusted for inflation, over the 20-year period; (3) the increase in permanent appropriations of 244 percent was the greatest increase during that period, with 99 percent of the funds going to entitlement-related accounts; and (4) most of the permanent appropriations used for nonentitlement-related accounts came from receipts earmarked for particular purposes. In addition, GAO found that: (1) the Federal Financing Bank's authority to borrow increases funding for loan programs; (2) monetary credits or bartering provide an indeterminate amount of spending authority; (3) legislation has not been successful in preventing the creation of new nonappropriated contract or borrowing authority; and (4) in the absence of systematic and periodic review, agencies may be using spending authorities that are no longer appropriate or that lack proper legal justification.

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