Legality of Making Advance Payments under Proposed Federal-State Agreements

The legality of making advance payments for telephone services under proposed Federal-State agreements was questioned. Payments to a State under a Federal contract for telephone service, executed by a contracting officer of the United States and obligating annual appropriations of the National Guard, are subject to the statutory prohibition against advance payments contained in 31 U.S.C. 529. This prohibition applies to advance payment of the capital cost of telephone equipment even though a State is the recipient since the services to be provided by the State are commercial in nature.