B-27311, JULY 27, 1942, 22 COMP. GEN. 59

B-27311: Jul 27, 1942

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DEPENDING UPON THE CONNECTION IN WHICH IT IS USED AND THE PURPOSE SOUGHT TO BE ACCOMPLISHED BY ITS USE. - SO THAT ONLY THAT BALANCE OF SAID FUND REMAINING AFTER RESERVING AN AMOUNT SUFFICIENT TO LIQUIDATE VALID OBLIGATIONS INCURRED WHILE THE FUND WAS AVAILABLE FOR OBLIGATION NEED BE COVERED INTO THE TREASURY. 1942: I HAVE YOUR LETTER OF JULY 8. TO WIT: "/A) THE PRESIDENT IS HEREBY AUTHORIZED. ESTABLISHED AND SET UP A FUND KNOWN AS THE " CONVERSION OF INHABITED ALLEYS FUND" OUT OF WHICH THE MAINTENANCE AND OPERATING EXPENSES FOR THE TITLE I PAYMENTS WERE PAID. UNDER THIS PROCEDURE THE ALLEY DWELLING AUTHORITY COULD MEET ITS DULY AUTHORIZED UNLIQUIDATED OBLIGATIONS FOR THE PAST FISCAL YEAR WHICH WERE NOT CURRENT OR DUE AS OF JUNE 30 OF THAT PARTICULAR YEAR.

B-27311, JULY 27, 1942, 22 COMP. GEN. 59

APPROPRIATIONS - "UNEXPENDED BALANCE" - WHAT CONSTITUTES THE TERM "UNEXPENDED," WHEN USED WITH REFERENCE TO APPROPRIATED MONEYS, MAY MEAN EITHER NOT PAID OUT OR NOT OBLIGATED, DEPENDING UPON THE CONNECTION IN WHICH IT IS USED AND THE PURPOSE SOUGHT TO BE ACCOMPLISHED BY ITS USE. THE TERM "UNEXPENDED BALANCE," AS USED IN THE PROVISIONS IN THE FISCAL YEAR 1943 APPROPRIATION FOR THE ALLEY DWELLING AUTHORITY THAT ANY UNEXPENDED BALANCE ON JUNE 30, 1942, OF THE " CONVERSION OF INHABITED ALLEYS FUND" ESTABLISHED PURSUANT TO THE DISTRICT OF COLUMBIA ALLEY DWELLING AUTHORITY ACT SHALL BE COVERED INTO THE TREASURY, MEANS THE UNOBLIGATED BALANCE--- AS DISTINGUISHED FROM THE BALANCE NOT ACTUALLY PAID OUT--- SO THAT ONLY THAT BALANCE OF SAID FUND REMAINING AFTER RESERVING AN AMOUNT SUFFICIENT TO LIQUIDATE VALID OBLIGATIONS INCURRED WHILE THE FUND WAS AVAILABLE FOR OBLIGATION NEED BE COVERED INTO THE TREASURY.

COMPTROLLER GENERAL WARREN TO THE EXECUTIVE OFFICER, THE ALLEY DWELLING AUTHORITY FOR THE DISTRICT OF COLUMBIA, JULY 27, 1942:

I HAVE YOUR LETTER OF JULY 8, 1942, AS FOLLOWS:

I PRESENT FOR YOUR CONSIDERATION AND OPINION THE FOLLOWING FACTS AND RELATED QUESTION.

THE ALLEY DWELLING AUTHORITY, CREATED PURSUANT TO AN ACT OF CONGRESS APPROVED JUNE 12, 1934, 48 STAT. 930-933, AND AS AMENDED BY THE ACT OF CONGRESS APPROVED JUNE 25, 1938, ACTING BY AND UNDER THE AUTHORITY CONFERRED UPON IT BY SECTION 3, TITLE I, TO WIT:

"/A) THE PRESIDENT IS HEREBY AUTHORIZED, IN HIS DISCRETION, TO MAKE IMMEDIATELY AVAILABLE TO THE AUTHORITY FOR ITS LAWFUL USES AND AS NEEDED, FROM THE ALLOCATION MADE FROM THE APPROPRIATION TO CARRY OUT THE PURPOSES OF THE NATIONAL INDUSTRIAL RECOVERY ACT, CONTAINED IN THE FOURTH DEFICIENCY ACT, FISCAL YEAR 1933, NOW CARRIED UNDER THE TITLE," NATIONAL INDUSTRIAL RECOVERY, FEDERAL EMERGENCY ADMINISTRATION OF PUBLIC WORKS, HOUSING, 1933-1935," SYMBOL 103/5666, NOT TO EXCEED $500,000 OR ANY AMOUNT THEREOF DEDICATED FOR LOW-COST HOUSING AND SLUM CLEARANCE PROJECTS IN THE DISTRICT OF COLUMBIA, TO BE SET ASIDE IN THE TREASURY AND BE KNOWN AS " CONVERSION OF INHABITED ALLEYS FUND" (HEREINAFTER REFERRED TO AS THE "FUND").' AND

"/C) THE FUND SHALL REMAIN AVAILABLE UNTIL JUNE 30, 1935, AND THEREAFTER SHALL BE AVAILABLE ANNUALLY IN SUCH AMOUNT AS MAY BE SPECIFIED IN THE ANNUAL APPROPRIATION ACTS.' ESTABLISHED AND SET UP A FUND KNOWN AS THE " CONVERSION OF INHABITED ALLEYS FUND" OUT OF WHICH THE MAINTENANCE AND OPERATING EXPENSES FOR THE TITLE I PAYMENTS WERE PAID, CONGRESS IN PREVIOUS YEARS HAVING APPROPRIATED THE UNEXPENDED BALANCE IN THIS FUND TO BE USED FOR THE SAME PURPOSE FOR THE ENSUING FISCAL YEAR IN THE FOLLOWING MANNER:

"THE UNEXPENDED BALANCE ON JUNE 30 (1941) OF THE " CONVERSION OF INHABITED ALLEYS FUND" , ESTABLISHED PURSUANT TO THE PROVISIONS OF THE DISTRICT OF COLUMBIA ALLEY DWELLING ACT, TOGETHER WITH ALL ACCRETIONS DURING THE FISCAL YEAR (1942) TO SAID FUND UNDER THE PROVISIONS OF SAID ACT AND OF THE UNITED STATES HOUSING ACT OF 1937 SHALL BE AVAILABLE UNTIL JUNE 30, (1942) FOR THE PURPOSE OF CARRYING OUT THE PROVISIONS OF SAID DISTRICT OF COLUMBIA ALLEY DWELLING ACT (48 STAT. 930-933; 52 STAT. 1186; 55 STAT. 97).'

UNDER THIS PROCEDURE THE ALLEY DWELLING AUTHORITY COULD MEET ITS DULY AUTHORIZED UNLIQUIDATED OBLIGATIONS FOR THE PAST FISCAL YEAR WHICH WERE NOT CURRENT OR DUE AS OF JUNE 30 OF THAT PARTICULAR YEAR. IN OTHER WORDS, THE UNEXPENDED BALANCE, WHICH INCLUDES THE UNLIQUIDATED OBLIGATIONS ACCORDING TO THE BUDGET-TREASURY REGULATION NO, 1 REVISED, WAS CARRIED OVER.

THE INDEPENDENT OFFICES APPROPRIATION ACT, 1943, PUBLIC LAW 630, APPROVED JUNE 27, 1942, CHANGES THIS PROCEDURE BY THE FOLLOWING PROVISION:

"FOR THE MAINTENANCE AND OPERATION OF PROPERTIES UNDER TITLE I OF THE DISTRICT OF COLUMBIA ALLEY DWELLING ACT, $12,000: PROVIDED, THAT ALL RECEIPTS DERIVED FROM SALES, LEASES, OR OTHER SOURCES, AFTER JULY 1, 1942, SHALL BE COVERED INTO THE TREASURY OF THE UNITED STATES MONTHLY: PROVIDED FURTHER, THAT ANY UNEXPENDED BALANCE ON JUNE 30, 1942, OF THE " CONVERSION OF INHABITED ALLEYS FUND," ESTABLISHED PURSUANT TO SUCH ACT SHALL ALSO BE COVERED INTO THE TREASURY.'

AS OF JUNE 30, 1942, THE ALLEY DWELLING AUTHORITY HAD DULY AUTHORIZED UNLIQUIDATED OBLIGATIONS OUTSTANDING AGAINST TITLE I FUNDS, PAYMENT OF WHICH WAS NOT DUE OR CURRENT, IN THE AMOUNT OF APPROXIMATELY $11,000.

THESE ARE VALID CLAIMS AGAINST THE GOVERNMENT AND HAVE TO BE PAID. THEREFORE, I REQUEST YOUR INTERPRETATION OF THE LAST PROVISION OF THE APPROPRIATION ACT, 1943, NAMELY:

"PROVIDED FURTHER, THAT ANY UNEXPENDED BALANCE ON JUNE 30, 1942, OF THE " CONVERSION OF INHABITED ALLEYS FUND," ESTABLISHED PURSUANT TO SUCH ACT SHALL ALSO BE COVERED INTO THE TREASURY.'

CAN WE ASSUME THAT THE USE OF THE TERM "UNEXPENDED BALANCE" MEANS THE UNOBLIGATED BALANCE AND THEREBY SET ASIDE SUFFICIENT FUNDS TO MEET THESE OBLIGATIONS AS THEY BECOME DUE AND PAYABLE, COVERING THE REST OF THE FUNDS INTO THE UNITED STATES TREASURY, OR WAS IT THE INTENTION OF CONGRESS THAT THE ENTIRE BALANCE IN THIS "FUND" AS OF JUNE 30, 1942 BE COVERED INTO THE TREASURY IRRESPECTIVE OF THESE UNLIQUIDATED OBLIGATIONS?

AN EXAMINATION OF THE DECISIONS OF THE COMPTROLLER GENERAL ON THIS POINT, IN MY OPINION, INDICATES THAT LEGAL CONTRACTUAL OBLIGATIONS MADE AND ENTERED INTO UNDER THE AUTHORITY OF A SPECIFIC APPROPRIATION PRIOR TO ITS STATUTORY LIMITATION, WHICH ARE UNLIQUIDATED AFTER ITS EXPIRATION, ARE PAYABLE FROM THE FUNDS OF THAT APPROPRIATION.

IN THE DECISION IN 16 COMP. GEN. 205, DECIDED AUGUST 31, 1936, RELATIVE TO AVAILABILITY OF APPROPRIATION BEYOND A SPECIFIED DATE, WE FIND THIS STATEMENT:

"WHEN AN APPROPRIATION IS BY ITS TERMS MADE AVAILABLE UNTIL A SPECIFIED DATE, THE GENERAL RULE IS THAT THE AVAILABILITY RELATES TO THE AUTHORITY TO OBLIGATE THE APPROPRIATION, AND DOES NOT NECESSARILY PROHIBIT PAYMENTS AFTER THE AVAILABLE DATE FOR OBLIGATIONS PREVIOUSLY INCURRED, UNLESS THE PAYMENT IS OTHERWISE EXPRESSLY PROHIBITED BY STATUTE.'

ALSO IN 19 (17) COMP. GEN. 111-/A-88016), WE FIND: "BUT THE UNEXPENDED BALANCE OF THE ALLOCATED FUNDS IS AVAILABLE ONLY FOR PAYMENTS FOR THE LANDS FOR THE ACQUISITION OF WHICH THE ATTORNEY GENERAL WAS REQUESTED TO INSTITUTE CONDEMNATION PROCEEDINGS AND FOR THE PAYMENT OF ANY OTHER OBLIGATION LEGALLY INCURRED PRIOR TO JULY 1, 1937;, ( ITALICS SUPPLIED.)

I REFER TO 18 COMP. GEN. 363 (A-9774) (A-97774) ON PAGE 365 IN WHICH THIS POINT IS DISCUSSED AS FOLLOWS:

"IT HAS LONG BEEN THE ACCEPTED GENERAL RULE OF THE ACCOUNTING OFFICERS OF THE GOVERNMENT THAT A CLAIM AGAINST AN ANNUAL APPROPRIATION WHEN OTHERWISE PROPER IS CHARGEABLE TO THE APPROPRIATION FOR THE FISCAL YEAR IN WHICH THE LIABILITY WAS INCURRED. THE RULE IS APPLICABLE IN ALL CASES IN WHICH THERE IS A DEFINITE DETERMINATION AS TO THE TIME THE PUBLIC FUNDS BECAME OBLIGATED FOR THE PAYMENT OF A GIVEN LIABILITY WHETHER THE AMOUNT IS, OR IS NOT, CERTAIN AT THE TIME.

"UNDER THE FORM OF AGREEMENT HERE UNDER CONSIDERATION, SINCE THERE IS A DEFINITE AGREEMENT TO PAY INDEMNITY, THE AMOUNT OF THE INDEMNITY PAYMENT NOT TO EXCEED A CERTAIN SUM, IT MUST BE HELD THAT THERE IS AN OBLIGATION AGAINST APPROPRIATED MONEYS WHEN THE AGREEMENT IS ENTERED INTO, AND THAT THE APPROPRIATION PROPERLY CHARGEABLE IS THE FISCAL YEAR APPROPRIATION CURRENT AT THE TIME THE AGREEMENT IS MADE.'

HOWEVER, SINCE NONE OF THESE DECISIONS ARE (SIC) ENTIRELY IN POINT, ESPECIALLY WITH REFERENCE TO THE LAST QUOTED PROVISION, AND THIS BEING A QUESTION OF UTMOST IMPORTANCE TO THE AUTHORITY, I RESPECTFULLY REQUEST A DECISION AT YOUR EARLIEST CONVENIENCE.

WHEN USED WITH REFERENCE TO APPROPRIATED MONEYS, THE TERM "UNEXPENDED" MAY MEAN EITHER NOT PAID OUT OR NOT OBLIGATED, DEPENDING UPON THE CONNECTION IN WHICH IT IS USED AND THE PURPOSE INTENDED TO BE ACCOMPLISHED BY ITS USE. FOR INSTANCE, IN SECTION 5 OF THE SURPLUS FUND ACT OF JUNE 20, 1874, 18 STAT. 110, IT IS PROVIDED THAT "UNEXPENDED BALANCES OF APPROPRIATIONS WHICH HAVE REMAINED UPON THE BOOKS OF THE TREASURY FOR TWO FISCAL YEARS" SHALL BE CARRIED TO THE SURPLUS FUND AND COVERED INTO THE TREASURY. IT HAS BEEN HELD CONSISTENTLY THAT THE WORDS "UNEXPENDED BALANCES" AS USED IN THAT ACT RELATE TO BALANCES NOT PAID OUT RATHER THAN UNOBLIGATED BALANCES. ON THE OTHER HAND, THE TERM "UNEXPENDED BALANCE" FREQUENTLY IS USED IN STATUTES WHEN THE CLEAR INTENT IS TO EMBRACE ONLY AN UNOBLIGATED BALANCE, SUCH AS IN CASES WHERE THE UNUSED FUNDS UNDER AN APPROPRIATION THERETOFORE MADE FOR A CERTAIN PURPOSE ARE REAPPROPRIATED FOR SOME OTHER PURPOSE, OR FOR SOME SUBSEQUENT FISCAL YEAR. IN THOSE CASES IT OBVIOUSLY IS NOT THE INTENT OF THE CONGRESS TO REAPPROPRIATE FUNDS WHICH ALREADY HAVE BEEN LEGALLY OBLIGATED UNDER THE ORIGINAL APPROPRIATION AND EFFECT TO THE CLEAR INTENT IS GIVEN BY CONSTRUING THE TERM "UNEXPENDED BALANCE" AS MEANING THE UNOBLIGATED BALANCE.

IN THE PRESENT MATTER, IT APPEARS THAT WHEN THE INDEPENDENT OFFICES APPROPRIATION BILL FOR 1943, H.R. 6430, WAS FIRST INTRODUCED IN THE HOUSE OF REPRESENTATIVES IT REPEATED THE LANGUAGE USED IN THE PRIOR FISCAL YEARS WITH RESPECT TO REAPPROPRIATION OF THE UNEXPENDED BALANCE OF THE CONVERSION OF INHABITED ALLEYS FUND, BUT THE SENATE COMMITTEE RECOMMENDED ITS ELIMINATION AND THE SUBSTITUTION THEREFOR OF THE LANGUAGE NOW IN QUESTION. NO REASON FOR THIS SUBSTITUTION IS FOUND IN THE REPORTS OF THE COMMITTEES, OR IN DEBATES, OTHER THAN THE STATEMENT OF SENATOR MCKELLAR AT THE SENATE COMMITTEE HEARINGS: "YOU MUST REALIZE SOME THINGS SHOULD BE POSTPONED WHILE WE ARE WAGING THIS .' TO SOME EXTENT THE REASON FOR THE PROVISION MAY BE GLEANED FROM THE CHANGE IN THE LANGUAGE ITSELF; THAT IS, WHILE AUTHORIZING THE CONTINUED OPERATION AND MAINTENANCE OF THE PROJECTS THERETOFORE CONSTRUCTED UNDER THE ALLEY DWELLING AUTHORITY ACT, THE CONGRESS WISHED TO ELIMINATE ANY NEW PROJECTS FOR THE APPARENT REASON THAT IT WAS DEEMED NECESSARY TO CURTAIL EXPENDITURES NOT ESSENTIAL TO DEFENSE AND WAR-WAGING ACTIVITIES. IN OTHER WORDS, BY PROVIDING FOR THE COVERING INTO THE TREASURY OF THE RECEIPTS AFTER JULY 1, 1942, AND THE UNEXPENDED BALANCE ON JUNE 30, 1942, IT WAS INTENDED TO LIMIT THE TOTAL AMOUNT OF OBLIGATIONS TO BE INCURRED DURING THE FISCAL YEAR 1943 TO THE AMOUNT ($12,000) THEREIN APPROPRIATED FOR THAT PURPOSE.

THERE IS NOTHING IN THE PROVISION, HOWEVER, NOR IN ITS LEGISLATIVE HISTORY, TO INDICATE ANY INTENT ON THE PART OF THE CONGRESS TO REQUIRE COVERING INTO THE TREASURY FUNDS AGAINST WHICH LEGAL AND VALID OBLIGATIONS HAD BEEN INCURRED WHILE SUCH FUNDS WERE AVAILABLE FOR THE INCURRING OF OBLIGATIONS. THE PLAIN PURPOSE AND EFFECT OF THE NEW LANGUAGE IN THE PROVISION IS MERELY THAT DURING THE FISCAL YEAR 1943 THE UNOBLIGATED BALANCE ON JUNE 30, 1942, WILL NOT BE AVAILABLE FOR OBLIGATING, BUT "SHALL BE COVERED INTO THE TREASURY.' IT IS INCONCEIVABLE THAT THE CONGRESS INTENDED TO REQUIRE THE COVERING INTO THE TREASURY OF MONEYS WHICH HAD BEEN LEGALLY OBLIGATED FOR THE PURPOSE FOR WHICH THEY WERE AVAILABLE AT THE TIME THE OBLIGATIONS WERE INCURRED, THEREBY NECESSITATING THE MAKING OF A SUBSEQUENT APPROPRIATION BEFORE SUCH LEGALLY INCURRED OBLIGATIONS COULD BE PAID.

ACCORDINGLY, IN SPECIFIC ANSWER TO THE QUESTION YOU SUBMIT I HAVE TO ADVISE THAT THE TERM ,UNEXPENDED BALANCE" AS USED IN THE REFERRED TO PROVISO IN THE ACT OF JUNE 27, 1942, PUBLIC LAW 630, 56 STAT. 398, MEANS THE UNOBLIGATED BALANCE, ONLY.