Prepayment by U.S. Treasury of Estimates of Taxes, Duties, and Fees To Be Collected in Guam and Virgin Islands

Recent amendments to laws pertaining to Guam and the Virgin Islands permit prepayment by the U.S. Treasury to territorial treasuries of estimates of moneys to be collected from certain taxes, duties, and fees. These prepayment provisions apply to collections which are not covered directly into the territorial treasuries. The Department of the Treasury observed that the prepayment to Guam and the Virgin Islands at the beginning of each fiscal year based on estimates of future collections requires an appropriation before moneys can be drawn from the Treasury. The Treasury Department further stated that Congress probably did not anticipate that appropriations would be needed in order to implement the prepayment provisions. Nevertheless, it was questioned whether the moneys could constitute permanent indefinite appropriations. GAO believes that the appropriations are not authorized in specific terms. The making of an appropriation is not to be inferred, but must be expressly stated. This principle is even more important in the case of a permanent appropriation. Therefore, GAO held that although the new amendments establish permanent authority for future appropriations, they do not establish permanent indefinite appropriations.