B-178278 April 27, 1973

B-178278 April 27, 1973

Ms. Annie Laurie Gunter Consumer Protection Officer Office of Comsumer Protection Executive Department, State of Alabama Montgomery, Alabama, 36104

Dear Ms. Gunter:

Your letter of March 16, 1973, requests any specific information this Office might have with respect to the availability of appropriations made to the various Federal regulatory agencies to defray the expenses and services of representatives of the public interest, such as the Alabama Office of Consumer Protection, in State utility rate proceedings.

You state:

It has been brought to my attention that congressional appropriations to the various Federal regulatory agenices may, in certain instances, be used to defray the expenses and services of representatives of the public interest in state utility rate proceedings.

While it is not completely clear from your letter, it may be that you are feferring to our decision of July 24, 1972, B-139703, to the Chairman of the Federal Trade Commission (FTC). In that decision we held that FTC appropriations may be used to pay certain expenses incurred by indigent parties to Commision adjudicative proceedings. We also held that FTC appropriatons were available to pay the expenses of indigent intervenors in FTC adjudicative proceedings when the agency determines is necessary to allow such persons to intervene in order for it to properly dispose of a matter before it. you will note from that decision, a copy of which is enclosed for your information, that several key factors determine whether particular expenses may be paid from an agency's appropriations. First, it must be determined whether the agency's basic statutory authority and the language of its appropriation acts would permit the payment of such expenses. Second, the agency involved must determine, on a reasonable basis, that the expenditure involved is necessary for it to carry out its statutory responsiblilities and the purposes of its appropriations. Finally, it is clear from our decision that a Federal regulatory agency may pay costs incurred by parties intervening in the agency proceedings on behalf of the public interest, only if the intervening parties are indigent.

While we have never considered the matter formally, it is not clear to us in what situations, if any, the payment of the costs of representing the public interest in State (as opposed to Federal) utility rate making proceedings could reasonably be considered a necessary expense for the purpose of carrying out the statutory mandate of a Federal regulatory agency. As indicated above, B-139703 supra, involved the use of FTC appropriations to defray the expenses of intervenors deemed necessary to the FTC's inquiry in the FTC's own adjudicative proceedings. Of course, as noted in B-139703 supra, the determination of what constitutes a "necessary expense" is left primarily to the reasonable discretion of the agency whose appropriations are involved. However, in our opinion, a tax- suuported State agency, which we assume yours is, may not be considered indigent.

Considering the above you are advised that we are not aware of any appropriations available to Federal regulatory agencies which may be used to assist the Alabama Office of Consumer Protection in defraying the expense of representing the public interest in State utility rate proceedings.

We trust foregoing will be of assistance to you.

Sincerely yours,

PAUL G. DEMBLING Comptroller General of the United States

Enclosure