Request for Opinion Concerning Proposed Army Program

B-200007: Sep 17, 1981

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GAO was asked whether the payment of a depreciation allowance by the Government in a proposed program would constitute an unauthorized augmentation of private funds with appropriated funds. The proposed program would permit a member of the service, who loses, damages, or destroys an item of Government property issued for the member's personal use, to purchase a replacement at an Army Self-Service Supply Center for a sum equivalent to the value of the depreciated item. This would automatically obligate the Government for the difference between the purchase price of the replacement item and the amount paid by the individual. GAO held that the proposed scheme of payment would not constitute an unauthorized usage of appropriated funds since the appropriated funds would be used for the acquisition of replacement property, a purpose for which they are clearly available, even at full cost. Moreover, in recognizing the depreciation of the lost property as a cost when the property is replaced in kind, the Army has merely determined that the total amount of the service member's debt to the Government was the depreciation value of the property. Further, although the program does not inherently violate the Antideficiency Act, the Army must establish adequate funding controls to assure that sufficient appropriated funds are available before authorizing the service member's purchase from the Self-Service Supply Center.