B-223657, Nov 14, 1988

B-223657: Nov 14, 1988

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Was proper under the regular General Services Administration appropriation for that fiscal year. The Fund was established by the Strategic and Critical Materials Stock Piling Revision Act of 1979. Receipts from stockpile sales were to be earmarked for use in purchasing necessary stockpile materials and "other reasonable requirements for management of the stockpile". The receipts were to be covered into the Fund to be used for such purposes. Your question was prompted by the inclusion in FEMA's June 26. The relocation proposal appears to have been the result of FEMA's efforts to cooperate with the General Services Administration (GSA) with respect to space management. The reasons for the relocation were that stockpile space managed by GSA was not being used optimally.

B-223657, Nov 14, 1988

APPROPRIATIONS/FINANCIAL MANAGEMENT - Appropriation Availability - Purpose availability - Released - Strategic/critical materials APPROPRIATION/FINANCIAL MANAGEMENT - Appropriation Availability - Time availability - Fiscal-year appropriation - Strategic/critical materials DIGEST: Implementation of the Federal Emergency Management Agency's proposal to use National Defense Stockpile Transaction Fund (Fund) money to pay for the relocation of stockpile materials, as reflected in the agency's revision to the annual materials plan for the stockpile for fiscal year 1987, was proper under the regular General Services Administration appropriation for that fiscal year.

The Honorable Charles E. Bennett Chairman, Subcommittee on Seapower and Strategic and Critical Materials Committee on Armed Services House of Representatives

This responds to your August 12, 1987, letter requesting our views regarding the legality of a Federal Emergency Management Agency (FEMA) proposal to use National Defense Stockpile Transaction Fund (Fund) moneys to pay for the 1987 relocation of stockpile materials. Our audit staff has already provided a separate response to your request for an audit of the use of National Stockpile Transaction Fund moneys over the past 2 years.

As discussed in more detail below, we conclude that FEMA had the legal authority to spend the Fund money as proposed.

The Congress originally authorized the creation of a Strategic and Critical Materials Stockpile in 1939. The Fund was established by the Strategic and Critical Materials Stock Piling Revision Act of 1979, in order to help ensure an adequate supply of materials for the national security. According to the 1979 Act, as amended in 1986, receipts from stockpile sales were to be earmarked for use in purchasing necessary stockpile materials and "other reasonable requirements for management of the stockpile"; the receipts were to be covered into the Fund to be used for such purposes.

Section 11 of the 1979 Act (50 U.S.C. Sec. 98h-2(b)) requires the President to submit an annual materials plan for the operation of the stockpile to the Congress concurrent with the submission of the annual budget. If, during a fiscal year, the President proposes a change in the annual materials plan already submitted, then under section 5 of the 1979 Act (50 U.S.C. Sec. 98d(a)(2)), no amount may be obligated or spent based on that change without prior notice to the appropriate congressional committees. The President then must wait until each committee advises that it has no objection, or 30 days from the committees' receipt of the notice, whichever comes first, before proceeding.

Your question was prompted by the inclusion in FEMA's June 26, 1987, proposed revision to the annual materials plan for fiscal year 1987 of $5 million in Fund moneys to relocate stockpile materials. The relocation proposal appears to have been the result of FEMA's efforts to cooperate with the General Services Administration (GSA) with respect to space management. According to that agency, the reasons for the relocation were that stockpile space managed by GSA was not being used optimally; there was no long range requirement for the space; and the relocation sites afforded greater accessibility at lower operating costs. You question the legality of paying for the relocation with Fund money apparently because the reasons for the relocation were not directly related to the national security.

We see nothing illegal in the use of the $5 million, even though we recognize that the impetus for it was, in GSA's view, prudent management of programs and space, as opposed to direct enhancement of national security. First, at the time of the FEMA proposal, authority existed in the 1979 Act to obligate money in the Fund for "reasonable requirements for management of the stockpile." In our view, this provision could be construed to authorize expenditures from the Fund for the proposed relocation of materials; in this regard, we note that one of the reasons for the relocation was, as noted above, to provide greater accessibility at lower operating costs. Based on that reading of the provision, and since FEMA submitted the specific proposal in question to the Congress on June 26, 1987, under section 5 of the 1979 Act authority existed to obligate amounts based on this proposal on July 26, 1987, 30 days later.

More importantly, on October 30, 1986, the Congress provided express authority for obligating Fund moneys for the relocation of stockpile materials during fiscal year 1987 by including a sentence in the regular General Services Administration appropriation for that fiscal year, under the heading "National Defense Stockpile Transaction Fund," as follows:

"Notwithstanding any other provision of law, funds previously made available to the fund before January 1, 1985, may be used for evaluating, testing, relocating, and upgrading stockpile materials to meet current stockpile goals and specifications." Pub. L. No. 99-591, 100 Stat. 3341, 3341-319.

In this respect, we think the quoted requirement that money in the Fund be used only to meet "current stockpile goals and specifications" reasonably encompasses current annual materials plans as submitted to the Congress. Also, as to the requirement that money to be used must have been made available to the Fund before January 1, 1985, we were informed by GSA that the Fund, as of October 1, 1987, had an unobligated balance of approximately $10 million from amounts made available to it before January 1, 1985, more than enough to cover the proposed relocation of stockpile materials.

Unless you release it earlier, this opinion will be made available to the public 30 days from today.