B-236141.1, Feb 23, 1990

B-236141.1: Feb 23, 1990

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APPROPRIATIONS/FINANCIAL MANAGEMENT - Judgment Payments - Approval - Certifying officers - Elimination DIGEST: GAO does not object to Treasury's elimination of its certifying officers from the process by which payments are made pursuant to 31 U.S.C. GAO by statute is the "agency concerned" for purposes of 31 U.S.C. You asked for our opinion on a proposal to eliminate Treasury Department certifying officers from the process by which judgments against the United States are paid from the so- called "Judgment Fund. We prepared a letter to Treasury which briefly advised it that we have no legal objection to this aspect of the proposal. /1/ A copy of the letter (B-237395. Bearing today's date) is attached for your information.

B-236141.1, Feb 23, 1990

APPROPRIATIONS/FINANCIAL MANAGEMENT - Judgment Payments - Approval - Certifying officers - Elimination DIGEST: GAO does not object to Treasury's elimination of its certifying officers from the process by which payments are made pursuant to 31 U.S.C. Sec. 1304. Although, as codified, 31 U.S.C. Sec. 3325(a)(1) (1982) directs executive branch disbursing officers to pay vouchers certified by the certifying officer or head of the "executive agency concerned", the original legislation did not so restrict a disbursing officer's authority. Rather, the original 1941 legislation permitted disbursing officers to disburse over vouchers certified by "the head of the department, establishment, or agency concerned" or his or her designed. Thus, for purposes of Judgment Fund payments, GAO by statute is the "agency concerned" for purposes of 31 U.S.C. Sec. 3325, and executive branch disbursing officers can pay any voucher duly certified by an authorized GAO official. SUBJECT: Certifying Officers in GAO - B-236141.1

TO: Director, GGD/Claims - Sharon Green

FROM: Associate General Counsel - Gary L. Kepplinger

By memorandum dated June 23, 1989, you asked for our opinion on a proposal to eliminate Treasury Department certifying officers from the process by which judgments against the United States are paid from the so- called "Judgment Fund," 31 U.S.C. Sec. 1304 (1982), as amended. The Claims Group and the Treasury Department's Financial Management Service (Treasury) proposal would discontinue Treasury's current practice of requiring its certifying officers to add their own certification to that of Claims Group before making disbursements from the Judgment Fund.

We also received a request for our opinion on this same question from Treasury. In its letter, Treasury advised that it "has no independent certifying authority with respect to the payment of judgments," and that its additional certifications offer "no added value" to the process. Treasury therefore proposed to "delegate any certifying authority Treasury has with respect to the Judgment Fund to GAO." For these reasons, we prepared a letter to Treasury which briefly advised it that we have no legal objection to this aspect of the proposal. /1/ A copy of the letter (B-237395, bearing today's date) is attached for your information. The balance of this memorandum provides a more detailed explanation of how we reached that conclusion.

As you know, the Judgment Fund is a permanent, indefinite appropriation established for the payment of the government's pecuniary obligations under certain judgments, administrative awards, and settlement agreements, where payment has not been otherwise provided by law. 31 U.S.C. Sec. 1304; H.R. Rep. No. 2638, 84th Cong., 2d Sess. 72. See, e.g., B-191028, March 27, 1978. The origin of the fund stems from the fact that agency operating funds are not available to pay judgments against the United States. E.g., 34 Comp.Gen. 221 (1954); 55 Comp.Gen. 1447, 1449 (1976). Prior to establishment of the Judgment Fund, the Congress separately appropriated funds to pay judgments against the government. Section 1304 was enacted to eliminate the need for separate appropriations for judgments, facilitate quicker payment of them, and reduce the amount of post judgment interest that accrued against the government as a result of the delays in making separate appropriations. Hearings on Supplemental Appropriation Bill, 1957, before Subcommittee of House Committee on Appropriations, 84th Cong., 2d Sess. at 883-885 (1956).

Before payments can be made from the Judgment Fund, they must be "certified" by the Comptroller General. /2/ 31 U.S.C. Sec. 1304(a)(2). In order to certify judgments for payment, Claims Group must assess whether:

(i) the item is properly payable from the Judgment Fund, or from some other source of funds;

(ii) the judgment, award, or settlement is final for payment purposes;

(iii) interest is authorized by law, and if so, in what amount; and

(iv) the payee owes any debts which must be collected by offset under 31 U.S.C. Sec. 3728 (1982).

Only after these steps have been completed does GAO issue a "Certificate of Settlement," or a voucher or schedule of vouchers for payment from the Judgment Fund. GAO's certificates of settlement and vouchers precisely identify the payee, the amount to be paid, the proper account to be charged, and a brief statement of the legal basis for the payment to be made. They also include a dated, signed statement by which the Director, Claims Group, or his delegatee personally affirms the statements made in the certificate. /3/

Once this process is completed, all that remains to be done is to make payment. Nevertheless, after Congress enacted section 1304, Treasury apparently decided to supplement GAO's certifications with certifications by its own officials. The purpose served by this additional procedure is unclear, especially since GAO retains all of the material necessary to verify the propriety of GAO's certification. As a practical matter, all that Treasury's certifying officials can do is verify that GAO has used the proper forms and that the official whose name appears on the certificate is authorized to certify judgments for payment, and check our arithmetic. /4/ Thus, we are inclined to agree with Treasury that its certification of Judgment Fund payments duplicate[ GAO's work and offers "no added value" to the certification process.

The only remaining question is whether Treasury's disbursing officers can rely upon GAO certifications when making disbursements. By law, executive branch disbursing officers are affirmatively prohibited from certifying the vouchers upon which they make payments. Act of Aug. 23, 1912, Pub. L. No. 62-299, Chap. 350, 37 Stat. 360, 375, codified in 31 U.S.C. Sec. 3521 (1982). Instead, with certain exceptions not relevant here, executive branch disbursing officers are specifically required to:

"disburse moneys only upon, and in strict accordance with, vouchers duly certified by the head of the department, establishment, or agency concerned, or by an officer or employee thereof duly authorized in writing by such head to certify such vouchers."

Act of Dec. 29, 1941, Pub. L. No. 77-389, Chap. 641, sec. 1, 55 Stat. 875, codified in 31 U.S.C. Sec. 3325(a)(1). This act establishes the duties and liabilities of disbursing and certifying officers in the executive branch. It does not apply to disbursing and certifying officers within the legislative or judicial branches. E.g., 21 Comp.Gen. 987 (1942); B-6061, June 19, 1947. /5/

The 1982 codification of title 31 of the United States Code significantly changed the language codified in 31 U.S.C. Sec. 3325 from the source passage quoted above from the 1941 legislation. While the 1941 legislation refers to vouchers certified by "the head of the department, establishment, or agency concerned" or his designee, section 3325 refers to vouchers certified by "the head of the executive agency concerned" or his designee. To the extent that the language of section 3325 substantively changes the law, it must be disregarded. The act codifying title 31, United States Code, specifically disavowed making any substantive changes in the laws represented by the provisions of title 31. Pub. L. No. 97-258, 4(a), 96 Stat. 877, 1067 (1982) ("saving" clause from 1982 act recodifying title 31 of the U.S. Code). Thus, to the extent that the revised provisions of title 31, including section 3325, would suggest a change in the law, it is both more accurate and legally correct to disregard the differing provisions of the recodification. See H.R. Rep. No. 651, 97th Cong., 2d Sess. 3-4 (1982). /6/

In this regard, we think it is important to distinguish those aspects of the 1941 legislation which concern the disbursement function from those aspects which concern the duties, liabilities, and rights of disbursing officers. Although the 1941 legislation specifically defines only the duties of disbursing and certifying officers employed within the executive branch (cf., e.g., 21 Comp.Gen. 987 (1942)), the 1941 legislative does not limit the executive branch disbursing officers to disbursing only on vouchers certified by executive branch certifying officers. It is one thing to define the duties of disbursing officers employed in the executive branch and to state, as the original language does, that such disbursing officers may only allow payment upon vouchers certified by the head of the agency, department, or establishment concerned. It is quite another to define the duties of disbursing officers in the executive branch and then say, as the 1982 recodification does, that executive branch disbursing officers may only pay vouchers certified by the head of the executive agency concerned.

In our view, where payments from the Judgment Fund are concerned, GAO, by statute, is the "agency concerned" for purposes of 31 U.S.C. 3325. At the time Congress established the Judgment Fund, the 1941 legislation had been on the books for 15 years. /7/ We think it was more than coincidental that Congress, in drafting section 1304, used the words "as certified by the Comptroller General" to describe the function entrusted to GAO. the time that Congress enacted section 1304 in 1956, interpretation of the 1941 legislation was well-settled and its terminology was in common use. Obviously, the Congress did not expect GAO to make the actual payments for which the fund was created; that was to remain Treasury's job. However, if GAO's role in the process was to be useful, meaningful, and consistent with prior legislation, which we must presume Congress intended, Congress would have to give GAO some authority which Treasury's disbursing officers could legally recognize and make payments upon. Thus, since under the 1941 legislation, Treasury's disbursing officers were forbidden to make payments except upon receipt of a "voucher duly certified by the head of the department, establishment, or agency concerned" or that person's designed, 55 Stat. 875, Congress presumably viewed GAO for purposes of Judgment Fund disbursement as the "agency concerned."

Accordingly, based on the plain language of the 31 U.S.C. Sec. 1304 and 3325(a)(1), it appears to us that there is ample authority for Treasury's disbursing officers to make payments pursuant to section 1304 upon vouchers certified solely by officials of GAO.

In conclusion, we are not aware of any legal requirement for Treasury's practice in this regard. Since Treasury has determined that its certifications do not serve any useful purpose, a view which we share, we would not object to the elimination by Treasury of its certifying officers from the process by which payments are made pursuant to 31 U.S.C. Sec. 1304.

1/ Inasmuch as the balance of the proposal has not been submitted or described to us in significant detail, we are presently unable to offer our opinion on any other aspects of the proposal.

/2/ The Comptroller General has delegated this authority to the Claims Group, pursuant to 32 U.S.C. Sec. 711(2) (1982). GAO, Operations Manual, Order No. 0130.1.41, sec. 5(c)(2) (Apr. 10, 1985), and Order No. 1160.1, sec. 6(a)(1) (Nov. 3, 1983).

/3/ Compare 31 U.S.C. Sec. 3528(a)(1) - (a)(3) (1982) (certification requirements of executive branch certifying officers). See 21 Comp.Gen. 987 (1942); B-6061, June 19, 1947.

/4/ In fact, we have previously held in this regard that once an authorized official has certified a voucher, later administrative processing of the voucher does not amount to certification for purposes of section 3528. Instead, the second officer to process the voucher is responsible only for errors made in his or her own processing of the vouchers. E.g., 55 Comp.Gen. 388 (1975).

/5/ Normally, certifying officers are officers or employees of the agency whose funds are being disbursed. E.g., 44 Comp.Gen. 100 (1964). Exceptions are permitted where one agency designates an employee of another agency to act as its certifying officer, 44 Comp.Gen. at 101, as well where one agency contracts with another pursuant to the Economy Act, 31 U.S.C. Sec. 1535, to obtain financial voucher certifications, 59 Comp.Gen. 471 (1980). We think a similar exception is appropriate where Congress authorizes or requires by statute, such as 31 U.S.C. Sec. 1304, an agency to certify payments from a fund which is nominally, if not in fact, an appropriation of another agency. Cf. 59 Comp.Gen. Gen. at 473 (General Services Administration (GSA) performance of financial certifications for an "expired" agency required an express Economy Act agreement, because "GSA has no independent authority to certify the vouchers of other agencies.").

/6/ Moreover, the suggestion in section 3325 that an executive branch disbursing official can only disburse over a certification of an executive branch official is not consistent with the 1941 legislation and, as such, should be disregarded as an unintended substantive change.

/7/ Act of July 27, 1956, Pub. L. No. 84-814, Chap. 748, Sec. 1302, 70 Stat. 668 694