B-124947, SEPTEMBER 29, 1955, 35 COMP. GEN. 163

B-124947: Sep 29, 1955

Additional Materials:

Contact:

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

 

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

000 WAS TRANSFERRED BY STANDARD FORM NO. 1151 TO THE APPROPRIATION. FUNDS FOR THE OPERATION OF OCEAN STATIONS WERE APPROPRIATED DIRECTLY TO THE COAST GUARD AND WERE ACCOUNTED FOR AS EXPENDITURES OF THAT AGENCY. THESE FUNDS WERE APPROPRIATED TO THE DEPARTMENT OF DEFENSE IN THE FISCAL YEAR 1955 FOR THE VERY PURPOSE OF HAVING THE EXPENDITURES THEREFOR REFLECTED AS EXPENDITURES OF THAT DEPARTMENT. THE FUNDS FOR THIS ACTIVITY WERE INCLUDED IN THE BUDGET FOR THE FISCAL YEAR 1956 UNDER THE APPROPRIATION " SHIPS AND FACILITIES" OVER OBJECTIONS OF THE DEPARTMENT OF DEFENSE AND APPROPRIATED ACCORDINGLY BY THE CONGRESS. THAT ITS POLICY WAS BASED UPON THE GENERAL PRINCIPLE THAT ONLY WHEN THE AGENCY REQUESTING A SERVICE IS WILLING TO PAY FOR IT CAN THE BUREAU MAKE SURE THAT THE WORK IS NECESSARY AND DONE IN THE MOST ECONOMICAL MANNER.

B-124947, SEPTEMBER 29, 1955, 35 COMP. GEN. 163

APPROPRIATIONS - TRANSFERS - BETWEEN DEPARTMENTS - PROCEDURE FOR RECORDING THE APPROPRIATION TRANSFER ACTION TO CARRY OUT A PROVISION IN THE 1955 NAVY DEPARTMENT APPROPRIATION, WHICH AUTHORIZES THE TRANSFER OF A SPECIFIED AMOUNT TO THE COAST GUARD FOR OCEAN STATIONS OPERATED PRIMARILY FOR THE NEEDS OF THE NAVY DEPARTMENT, SHOULD BE TREATED AS A SIMULTANEOUS OBLIGATION AND EXPENDITURE AND ACCOMPLISHED ON STANDARD FORM 1080, SCHEDULE OR VOUCHER AND SCHEDULE OF WITHDRAWALS AND CREDITS BETWEEN APPROPRIATIONS, AND/OR FUNDS, PURSUANT TO ACCOUNTING SYSTEMS MEMORANDUM NO. 9--- SECOND REVISION AS AMENDED AND SUPPLEMENTED.

TO THE SECRETARY OF DEFENSE, SEPTEMBER 29, 1955:

THE ASSISTANT SECRETARY OF DEFENSE ( COMPTROLLER), BY LETTER OF AUGUST 3, 1955, REQUESTS OUR DECISION AS TO WHETHER THE LANGUAGE IN THE APPROPRIATION " SHIPS AND FACILITIES, NAVY" CONTAINED IN THE DEPARTMENT OF DEFENSE APPROPRIATION ACT, 1955, PUBLIC LAW 458, APPROVED JUNE 30, 1954, 68 STAT. 337, 343, REQUIRING THAT $15,675,000 BE TRANSFERRED TO THE APPROPRIATION " COAST GUARD OPERATING EXPENSES" FOR THE OPERATION OF OCEAN STATIONS, MAY LEGALLY BE ACCOMPLISHED BY USE OF STANDARD FORM NO. 1080, SCHEDULE OR VOUCHER AND SCHEDULE OF WITHDRAWALS AND CREDITS BETWEEN APPROPRIATIONS AND/OR FUNDS.

THE APPROPRIATION " SHIPS AND FACILITIES, NAVY, 1955" PROVIDES, IN PERTINENT PART, AS FOLLOWS:

FOR EXPENSES NECESSARY * * * $818,681,000, OF WHICH $15,675,000 SHALL BE TRANSFERRED TO THE APPROPRIATION " COAST GUARD OPERATING EXPENSES, 1955" FOR THE OPERATION OF OCEAN STATIONS.

THE ASSISTANT SECRETARY STATES THAT THIS AMOUNT OF $15,675,000 WAS TRANSFERRED BY STANDARD FORM NO. 1151 TO THE APPROPRIATION," COAST GUARD OPERATING EXPENSES, 1955," PURSUANT TO THE PROVISIONS OF ACCOUNTING SYSTEMS MEMORANDUM NO. 9, 29 COMP. GEN. 569. HOWEVER, THE BUREAU OF THE BUDGET BY MEMORANDUM DATED JUNE 23, 1955, TO THE TREASURY DEPARTMENT REQUESTED THAT THE MOVEMENT OF FUNDS FOR THIS ACTIVITY BE REVERSED AND DOCUMENTED BY THE USE OF STANDARD FORM NO. 1080, THEREBY REFLECTING SUCH TRANSACTION AS AN OBLIGATION AND EXPENDITURE TRANSACTION OF THE DEPARTMENT OF DEFENSE AND CONCURRENTLY TREATED AS A REIMBURSEMENT TO THE COAST GUARD.

PRIOR TO THE FISCAL YEAR 1955, FUNDS FOR THE OPERATION OF OCEAN STATIONS WERE APPROPRIATED DIRECTLY TO THE COAST GUARD AND WERE ACCOUNTED FOR AS EXPENDITURES OF THAT AGENCY. IN ACCORDANCE WITH THE POLICY OF THE BUREAU OF THE BUDGET, THESE FUNDS WERE APPROPRIATED TO THE DEPARTMENT OF DEFENSE IN THE FISCAL YEAR 1955 FOR THE VERY PURPOSE OF HAVING THE EXPENDITURES THEREFOR REFLECTED AS EXPENDITURES OF THAT DEPARTMENT. THE FUNDS FOR THIS ACTIVITY WERE INCLUDED IN THE BUDGET FOR THE FISCAL YEAR 1956 UNDER THE APPROPRIATION " SHIPS AND FACILITIES" OVER OBJECTIONS OF THE DEPARTMENT OF DEFENSE AND APPROPRIATED ACCORDINGLY BY THE CONGRESS. THE BUREAU OF THE BUDGET STATED, IN A LETTER DATED SEPTEMBER 28, 1954, TO YOU, THAT ITS POLICY WAS BASED UPON THE GENERAL PRINCIPLE THAT ONLY WHEN THE AGENCY REQUESTING A SERVICE IS WILLING TO PAY FOR IT CAN THE BUREAU MAKE SURE THAT THE WORK IS NECESSARY AND DONE IN THE MOST ECONOMICAL MANNER.

WHETHER FUNDS SHOULD BE TRANSFERRED FROM ONE APPROPRIATION TO ANOTHER ON STANDARD FORM NO. 1080 OR STANDARD FORM NO. 1151 IS FOR DETERMINATION UNDER THE PROVISIONS OF ACCOUNTING SYSTEMS MEMORANDUM NO. 9--- SECOND REVISION, DATED DECEMBER 11, 1950, 30 COMP. GEN. 607, AS AMENDED AND SUPPLEMENTED, ISSUED UNDER THE AUTHORITY OF THE BUDGET AND ACCOUNTING ACT, 1921, 42 STAT. 20, AND THE BUDGET AND ACCOUNTING PROCEDURES ACT OF 1950, PUBLIC LAW 784, APPROVED SEPTEMBER 12, 1950, 64 STAT. 832. THIS MEMORANDUM WAS COORDINATED WITH THE BUREAU OF THE BUDGET, THE DEPARTMENT OF THE TREASURY, AND OTHER INTERESTED AGENCIES INCLUDING THE DEPARTMENT OF DEFENSE PRIOR TO ITS ISSUANCE. THE TYPES OF WITHDRAWALS AND CREDITS BETWEEN APPROPRIATIONS TO BE EFFECTED BY STANDARD FORM NO. 1151 AS NONEXPENDITURE TRANSACTIONS ARE SET OUT IN PARAGRAPH 3A OF THAT MEMORANDUM. THOSE TYPES OF TRANSACTIONS INVOLVING ADJUSTMENT OF APPROPRIATIONS INCLUDE CASES ONLY WHERE THE AMOUNTS TRANSFERRED DO NOT REPRESENT ANY BENEFIT TO THE PAYING APPROPRIATION. THE TYPES OF WITHDRAWALS AND CREDITS BETWEEN APPROPRIATIONS TO BE EFFECTED BY STANDARD FORM 1080 TRANSACTIONS ARE SET OUT IN PARAGRAPH 3B WHICH PROVIDES, IN PERTINENT PART, AS FOLLOWS:

B. WITHDRAWALS FROM APPROPRIATIONS REPRESENTING PAYMENTS TO OTHER APPROPRIATIONS, REVOLVING FUNDS, OR WORKING FUNDS, TO CARRY OUT THE PURPOSE OF THE PAYING APPROPRIATION. THESE TRANSACTIONS SHALL BE RECORDED AS OBLIGATIONS AND EXPENDITURES AND REIMBURSEMENTS IN THE PAYING AND RECEIVING APPROPRIATION, RESPECTIVELY, AND SHALL BE RECORDED AND REPORTED ACCORDINGLY. THEY WILL BE REFERRED TO AS EXPENDITURE TRANSACTIONS. THE DIFFERENT KINDS OF TRANSACTIONS WHICH ARE INCLUDED IN THE GENERAL CLASS AND THE RELATED ACCOUNTING PROCEDURES ARE AS FOLLOWS:

(1) PAYMENTS TO OTHER APPROPRIATIONS WHERE THE IDENTITY OF THE PAYING APPROPRIATION IS NOT MAINTAINED AND WHERE THE LAW AUTHORIZES A MERGER OF THE FUNDS. THIS INCLUDES PAYMENTS BETWEEN APPROPRIATIONS, EVEN THOUGH THERE ARE NO SPECIFIC ORDERS INVOLVED. AN EXAMPLE OF THIS TYPE OF TRANSACTION IS WHERE THE CONGRESS SPECIFIES THAT A PARTICULAR AMOUNT SHALL BE PAID OR TRANSFERRED FROM ONE APPROPRIATION TO ANOTHER IN ORDER TO CARRY OUT THE GENERAL PURPOSES OF THE FIRST APPROPRIATION.

THIS PARAGRAPH 3B (1) IS CONTROLLING ON THE TRANSFER HERE INVOLVED. INDICATED ABOVE, IT WAS DETERMINED BY THE BUREAU OF THE BUDGET AND THE CONGRESS THAT THE PRIMARY NEED OF THESE OCEAN STATIONS IS TO CARRY OUT THE PURPOSE OF THE PAYING APPROPRIATION " SHIPS AND FACILITIES, NAVY, 5.' IT APPEARS THAT THIS MILITARY REQUIREMENT WAS EMBODIED IN AN INTERNATIONAL AGREEMENT ENTERED INTO TO OBTAIN A CERTAIN NETWORK DESIRED BY THE DEPARTMENT OF DEFENSE. THE IDENTITY OF THE PAYING APPROPRIATION IS NOT MAINTAINED AND THE PROVISION IN THE PAYING APPROPRIATION, QUOTED ABOVE, AUTHORIZES THE CREDITING OF THE FUNDS DIRECTLY TO THE COAST GUARD APPROPRIATION. THE EXAMPLES SET OUT IN THE MEMORANDUM IS WHERE THE CONGRESS SPECIFIES THAT A PARTICULAR AMOUNT SHALL BE PAID OR TRANSFERRED FROM ONE APPROPRIATION TO ANOTHER IN ORDER TO CARRY OUT THE GENERAL PURPOSES OF THE FIRST APPROPRIATION, WHICH IS THE EXACT SITUATION HERE INVOLVED. THE TYPES OF TRANSACTIONS COMING WITHIN PARAGRAPH 3B ARE NOT RESTRICTED TO PAYMENTS MADE ONLY ON A REIMBURSABLE BASIS, BUT INCLUDE ADVANCES AND, IN SUCH CASES, IT IS PROVIDED THAT, WHERE ADVANCES ARE MADE BEFORE AN OBLIGATION HAS BEEN SET UP, SUCH ADVANCES WILL BE TREATED SIMULTANEOUSLY AS OBLIGATIONS AND EXPENDITURES.

THE ASSISTANT SECRETARY IS CORRECT IN STATING THAT THE AMOUNT TO BE "TRANSFERRED" TO THE COAST GUARD IS FIXED BY STATUTE AT $15,675,00 AND THAT THIS DOES NOT SEEM TO AUTHORIZE "REIMBURSEMENT" IN NOT EXCEEDING $15,675,000. THE FULL AMOUNT OF $15,675,000 IS REQUIRED TO BE TRANSFERRED BY THE LANGUAGE IN THE APPROPRIATION AND THE ONLY EVIDENCE REQUIRED TO BE SHOWN ON THE DOCUMENT EFFECTING THE TRANSFER IS A REFERENCE TO THAT STATUTORY LANGUAGE.

ACCORDINGLY, THE QUESTION PRESENTED IS ANSWERED IN THE AFFIRMATIVE AND THE TRANSFER OF THESE FUNDS ON STANDARD FORM NO. 1151 SHOULD BE REVERSED AND THE TRANSFER ACCOMPLISHED ON STANDARD FORM NO. 1080, AS REQUESTED BY THE BUREAU OF THE BUDGET.