B-229958, Mar 10, 1988, 67 Comp.Gen. 332

B-229958, Mar 10, 1988, 67 Comp.Gen. 332

APPROPRIATIONS/FINANCIAL MANAGEMENT - Budget Process - Permanent/Indefinite Appropriation MISCELLANEOUS TOPICS - Finance Industry - Financial Institutions - Government Corporations - Funding Statutory authority to fund the Commodity Credit Corporation for 1988 and subsequent fiscal years by means of a current indefinite appropriation is merely an authorization to make appropriations in that manner. It is not itself an appropriation act and cannot be construed to nullify or supersede line-item appropriations for fiscal year 1988. APPROPRIATIONS/FINANCIAL MANAGEMENT - Budget Process - Conflicting Statutes - Statutory Interpretation APPROPRIATION/FINANCIAL MANAGEMENT Budget Process - Continuing Resolutions - Statutory Interpretation - Congressional Intent When two statutes are enacted on the same day, even if there is evidence that one passed several hours after the other, we will not apply the general rule that the later passed statute represents the most recent expression of congressional will and therefore nullifies or supersedes the earlier statute, to the extent that they are inconsistent. Such close proximity in time is forceful evidence that Congress intended the two statutes to stand together.

Matter of: The Honorable Patrick J. Leahy, United States Senate

This is in response to your letter of January 5, 1988, requesting our opinion on the status of the Commodity Credit Corporation's (Corporation) fiscal year 1988 funding authority. In your letter, you asked us to advise you concerning the impact of section 1506 of the Omnibus Budget Reconciliation Act of 1987 (Reconciliation Act), Pub. L. No. 100-203, approved Dec. 22, 1987, 101 Stat. 1330 on the fiscal year 1988 line-item appropriations made by the Joint Resolution making further appropriations for the fiscal year 1988, and for other purposes (Continuing Resolution), Pub. L. No. 100-202, approved Dec. 22, 1987, 101 Stat. 1329. Specifically, you asked us to consider whether the line-item appropriations for fiscal year 1988 are nullified by the Reconciliation Act and whether the Reconciliation Act creates a current, indefinite appropriation for the fiscal year 1988. Because of your concern that farmers receive, without disruption, the payments owed to them by the Corporation, your asked whether, in our opinion, payments to framers might be dependent upon supplemental appropriations in fiscal year 1988.

For the reasons given below, we conclude that the language in the Reconciliation Act which authorizes funding of the Corporation for 1988 and subsequent fiscal years by means of a current, indefinite appropriation does not nullify line-item appropriations in the Continuing Resolution and does not alter or expand the availability of those appropriations. Because the Reconciliation Act does not contain a specific direction to pay, it cannot itself be construed as an appropriation. Therefore, payments to farmers would have to be suspended if the Corporation exhausts its fiscal year 1988 budget authority available for payments to farmers and supplemental funds are not appropriated.

Background

The Corporation is a wholly owned government corporation and has an authorized capital stock of $100 million. 15 U.S.C. Sec. 714e. addition, the Corporation is authorized to borrow funds from the Treasury and other lenders. Effective in fiscal year 1988, the Continuing Resolution provided authority for the Corporation to increase its total borrowings from $25 billion to $30 billion. As you noted in your letter, Congress, in previous years, appropriated money in a lump-sum in order for the Corporation to pay its indebtedness to the Treasury. The Corporation used its borrowing authority to fund its upcoming activities for the year. However, in the Continuing Resolution, the Congress rejected this approach for fiscal year 1988 and funded the Corporation's programs and activities by means of direct, line-item appropriations from the Treasury for the Corporation's operating expenses under 17 major program accounts. See H.R. Rep. No. 100-498, 1108 (1987).

In section 1506(a) of the Reconciliation Act, the Congress amended 15 U.S.C. Sec. 713a-11 to read as follow:

There is hereby authorized to be appropriated annually for each fiscal year, by means of a current, indefinite appropriation, out of any money in the Treasury not otherwise appropriated, an amount sufficient to reimburse Commodity Credit Corporation for its net realized loss incurred during such fiscal year, as reflected in its accounts and shown in its report of its financial condition as of the close of such fiscal year. Reimbursement of net realized loss shall be with appropriated funds, as provided herein, rather than through the cancellation of notes.

The Reconciliation Act also provided that beginning with fiscal year 1988, "No funds may be appropriated for operating expenses of the Commodity Credit Corporation except as authorized under section 2 of Public Law 87-155 (15 U.S.C. 713a-11) to reimburse the Corporation for net realized losses." You asked our opinion as to whether this amended language creates a current indefinite appropriation which nullifies the line-item appropriations made by the Continuing Resolution for operating expenses of the Corporation. We conclude that it does not.

Discussion

by the terms of the phrase, "There is hereby authorized to be appropriated," section 1506 of the Reconciliation Act, provides only the authority for enactment of a current indefinite appropriation to reimburse the Corporation for its net realized loss. The provision does not, however, actually appropriate funds. You are correct in pointing out that a statute which contains a specific direction to pay and a designation of funds to be used creates an appropriation providing authority to incur obligations and to make payments out of the Treasury for specified purposes. B-160998, April 13, 1978. However, the language in section 1506 of the Reconciliation Act does not provide any specific direction to pay. "The mere authorization of an appropriation does not authorize expenditures on the faith thereof or the making of contracts obligating the money authorized to be appropriated." 16 Comp.Gen. 1007, 1008 (1937); accord, 35 Comp.Gen. 306, 307 (1955). It must be clear from the Act that money is being appropriated before obligations and expenditures are authorized. See 31 U.S.C. Sec. 1301; 50 Comp.Gen. 863 (1971). Accordingly, section 1506 of the Reconciliation Act did not itself create a current indefinite appropriation; it merely authorized the Congress to make such an appropriation to fund the Corporation in fiscal year 1988. The Congress, however, is not bound to make its appropriation in the form specified in the authorization set forth in the Reconciliation Act. chose instead to utilize a number of line-item appropriations for each program account an arrangement which the Reconciliation Act, in the form enacted cannot nullify. /1/

You point out that the Reconciliation Act was enacted subsequent to the Continuing Resolution containing the line-item limitations in question. Normally, in cases of conflicting statutes, the latest expression of the Congress governs. However, where, as with the Reconciliation Act and the Continuing Resolution, the two acts were under consideration and enacted on the same day, we cannot conclude that Congress intended the Reconciliation Act to govern as its latest expression in order to nullify the Continuing Resolution. Such proximity in time of enactment is forceful evidence that Congress intended the two statutes to stand together. Morf v. Bingaman, 293 U.S. 407, 414 (1935).

It is true that the language in the Reconciliation Act authorizing funding of the Corporation by means of a current, indefinite appropriation, "beginning with fiscal year 1988," must be regarded as permanent authority which will have to be considered when the Congress considers making appropriations in subsequent years. For example, if its is again proposed to make line-item appropriations for each program account, the absence of authorization in law for such appropriations may well subject the funding proposal to a point of order if the issue is raised. /2/ However, now that funds are appropriated for fiscal year 1988, they remain available by the terms of the Continuing Resolution (see B-175155, July 25, 1979).

In response to your final question of whether supplemental appropriations may be necessary in order to make payments to farmers in fiscal year 1988, it is our opinion that if the Corporation exhausts the line-item appropriations available for those payments made in the continuing Resolution and also exhausts its available assets and remaining borrowing authority, payments to farmers would have to be suspended unless supplemental appropriations are made for fiscal year 1988. /3/ Under subsection 4(i) of the Commodity Credit Corporation Charter Act, 15 U.S.C. Sec. 714(i), as amended by the Continuing Resolution, the Corporation is authorized to borrow an aggregate amount not exceeding $30 billion. See also 15 U.S.C. Sec. 713a-4. In addition, it is authorized to make such expenditures, within the limits of its available funds and borrowing authority and in accord with law, as may be necessary to carry out its authorized programs. 15 U.S.C. Sec. 713a-10; 15 U.S.C. Sec. 714f. If the Corportation exhausts all of these resources available to make payments for farmers in fiscal year 1988, payments will have to be suspended until supplemental appropriations are made.

Unless released by your office earlier, this opinion will be made publicly available 30 from today.

/1/ The Department of Agriculture, responding to our request for the view of the Secretary, also concluded that "Section 1506(b) of the Reconciliation Act does not nullify the line-item appropriations for financing Corporation programs for fiscal year 1988.

/2/ See Rule XXI(2), Rules of the House of Representatives (H.R. Doc. No. 98-277, 98th Cong., 2d Sess., 564); Rule XVI, Standing Rules of the Senate (S. Doc. No. 97-2, 97th Cong., 1st Sess., 120).

/3/ In responding to our request for the views of the Secretary of Agriculture, a representative expressed the opinion that "The funds made available for CCC by the line-item appropriations in the Continuing Resolution may only be used for the purposes specified and may be transferred between items as provided therein. CCC may also use its borrowing authority (15 U.S.C. 714(i)), which was increased in the Continuing Resolution to $30,000,000,000 in carrying out its activities. The Corporation may also use, as provided in section 8 of the Commodity Credit corporation Charter Act (15 U.S.C. 714f), all its funds and other assets in the conduct of its business. the line-item appropriation provision specifically provides that the provisions thereof 'shall not interfere with the Commodity Credit Corporation's discharge of its corporate responsibilities'."