Legality of Continued U.S. Contributions to the International Fund for Agricultural Development

B-196401: Published: Dec 13, 1979. Publicly Released: Jun 4, 1985.

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GAO was asked whether: (1) the United States can make further contributions to the International Fund for Agricultural Development when Iran is in default in fulfilling its commitment to the Fund, and this default lowers total donor contributions below $1 billion; and (2) Iran's default, if not made up by other donors in the same category as Iran, would be in violation of the authorizing statute. U.S. contributions to the Fund were authorized by the International Development and Food Assistance Act of 1975. The act conditioned U.S. participation on total donor commitments to the Fund of $1 billion and equitable sharing of the burden among the different categories of donors. The statute provides that funds are not to be obligated to participate in the Fund unless commitments to the Fund by all donors total at least $1 billion. However, the U.S. contribution shall be reduced if this combined goal is not met. This exception applies only when donor nations other than the United States have not pledged at least $800 million. If other donors commit $800 million, the United States may commit the full $200 million authorized for the Fund. No funds may be obligated for participation in the Fund unless there is equitable burden sharing among the different categories of donors. It is the opinion of GAO that Iran's default, even if not replaced by other donors of the same category, does not violate the equitable burden-sharing condition of the authorizing legislation.

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