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Tips on Base Level Fiscal Law. Keith M. Dunn Counsel to the Navy Surgeon General Navy Bureau of Medicine and Surgery [email protected] 202.762.3299 www.twitter.com/TheFiscalLawyer. The Power of the Purse.

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Tips on Base Level Fiscal Law

Keith M. Dunn

Counsel to the Navy Surgeon General

Navy Bureau of Medicine and Surgery

[email protected]

202.762.3299

www.twitter.com/TheFiscalLawyer


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The Power of the Purse

  • “No money shall be drawn from the Treasury, but in Consequence of Appropriations made by law . . . “

    • Constitution, Article I, section 9, clause 7


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what does it mean?

“The established rule is that the expenditure of public funds is proper only when established by Congress, not that public funds may be expended unless prohibited by Congress.”

United States v. MacCollom, 426 US 317 (1976)


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Sources of Law

  • US CODE

  • AUTHORIZATION ACTS

    • AUTHORIZE PROJECTS - 10 USC 2802

    • AUTHORIZE APPROPRIATIONS - 10 USC 114

    • ENACT PERMANENT LEGISLATION

  • APPROPRIATION ACTS

    • 31 USC 1301(d)

    • GENERALLY TEMPORARY

  • OTHER PUBLIC LAWS

  • OPINIONS


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THE BOX DOES NOT CHANGE!

PURPOSE

  • Funds may be obligated and expended only for specified purposes;

    TIME

  • Funds are available for obligation only for specified time limits

    AMOUNT

  • Agencies may not spend more than is appropriated


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Banking and Laundering Funds

If it sounds too good to be true, it is.

Sending money to GSA does not change the character of your money!

(Neither does MIPRing it somewhere!)

You cannot extend the life of money by offloading it somewhere!


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Interagency AgreementsB-308944, July 17, 2007

  • A MIPR lacking specificity as to the goods or services ordered does not serve properly to obligate DOD funds

  • Funds must be used within a reasonable time of receipt in order to meet the bona fide needs rule.


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Natural Resources Conservation Service – Obligating Orders with GSA’s AutoChoice Summer ProgramB-317249, July 1, 2009

  • Current fiscal year funds are not available for obligation for orders placed this fiscal year that cannot be finalized until the next fiscal year.

  • Not a valid obligation to the current fiscal year because, until finalized, the order is tentative and incomplete.


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Speaking of GSA . . . with GSA’s AutoChoice Summer ProgramChemical Safety and Hazard Investigation Board – Interagency Agreement with the General Services Administration, B318425, December 8, 2009

  • FY appropriations are not available to fund severable services that will be performed in a future fiscal year

  • Proposed IA that does not specify a period of performance or the services to be provided (exposing the agency to an unknown liability) violates the Antideficiency Act.


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Funding of Severable Services Contracts with GSA’s AutoChoice Summer ProgramSeverable Services Contracts, B-317636, April 21, 2009

  • 10 USC 2410a authorizes agencies to enter into severable services contracts that begin in one fiscal year and end no more than 12 months later funded with the appropriation current at the time of contract award

    • a statutory exception to the bona fide needs rule

    • only applies to contracts funded with time limited appropriations

  • An agency using a multiple year appropriation would not violate the bona fide needs rule if it enters into a severable services contract for more than one year so long as the period of performance does not exceed the period of availability of the appropriation

  • Bona fide needs rule not an issue with no-year funds


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Nonseverable Services Contracts with GSA’s AutoChoice Summer Program

  • A nonseverable services contract that is not separated for performance by fiscal years may not be funded on an incremental basis without statutory authority.

  • Failure to obligate the estimated cost of a nonseverable cost reimbursement contract at time of award violates the bona fide needs rule.

    Financial Crimes Enforcement Network – Obligations under a Cost-Reimbursement, Nonseverable Services Contract, B-317139, June 1, 2009


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Recurring Purpose Issues with GSA’s AutoChoice Summer Program

Plus ca change plus c'est la meme


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Food with GSA’s AutoChoice Summer Program

“[F]ree food . . . Normally cannot be justified as a ‘necessary expense’ under an appropriation since such expenses are considered personal expenses that government employees are expected to bear from their own salaries.”

72 Comp. Gen. 178

Forest Service--Light Refreshments for National Trails Day, B-310023, April 17, 2008


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The Food Exceptions with GSA’s AutoChoice Summer Program

Emergencies

Training

Meetings

Conferences

Awards Ceremonies

Cultural Awareness Ceremonies

Travel

DoD DGC(Fiscal) memo dtd 1 Sept 05

FMB memo dtd 12 May 06

http://www.gao.gov/special.pubs/appforum2005/approfunds/index.html


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U.S. Army Garrison Ansbach, B-317423, March 9, 2009 with GSA’s AutoChoice Summer Program

  • Food may be provided for civilian employees, military members, and nonfederal participants such as contractors and host nation first responders at annual antiterrorism training exercises where necessary to achieve the objectives of the training exercise

  • That it would be an “embarrassment” not to provide food to host nation first responders is not sufficient justification for using appropriated funds to buy food for nonfederal personnel


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Department of the Navy – Lunch for Volunteer Focus Group with GSA’s AutoChoice Summer ProgramB-318499, November 19, 2009

  • In general, appropriated funds are not available for personal expenses, such as lunch

  • Whether to provide food for focus group participation must be decided on a case-by-case basis

  • Here, no specific statutory objective identified, so appropriated funds not available

  • Contrast with Veterans Benefits Administration – Refreshments for Focus Groups, B-304718, Nov. 9, 2005


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Bottled Water with GSA’s AutoChoice Summer Program

The Rule:

personal expense!

Appropriated funds may be used only upon a showing of necessity; i.e., there is no potable water available.

2 Comp. Gen 776 (1923) and many other cases!

B-318588, Sept. 29, 2009

B-310502, 4 Feb 2008


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Kitchen Appliances with GSA’s AutoChoice Summer Program

  • Use of Appropriated Funds to Purchase Kitchen Appliances, B-302993, 25 June 2004

    • appropriated funds may be used to purchase major kitchen appliances that would be placed in common areas for the use of personnel at the site


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Clothing with GSA’s AutoChoice Summer Program

“ . . . every employee of the Government is required to present himself for duty properly attired according to the requirements of his position.”

63 Comp. Gen. 245, 246 (1984)

See also B-288828, 3 Oct 02; B-289683, 7 Oct 02


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The Clothing Exceptions with GSA’s AutoChoice Summer Program

Official Civilian DOD Uniforms: 10 U.S.C. § 1593

Administrative Expenses Act: 5 U.S.C. § 7903

Special/unusual clothing

Item must be for the benefit of the Government, essential to the safe and successful accomplishment of the work, and not solely for the protection/comfort of employee

Must involve hazardous duty

OSHA Compliance: 29 U.S.C. § 668


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Not Exceptions! with GSA’s AutoChoice Summer Program

Raincoats and umbrellas for employees who must frequently go out into the rain

Running shoes for couriers

Cold weather/foul weather gear


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the “strolling through the mall” test with GSA’s AutoChoice Summer Program

Jackets with cool Command Logos given to all employees to increase esprit d’ corps

“Organizational Clothing”

Clothing items that are specifically required safety equipment under NAVOSH Instructions

Foul weather gear and work overalls demanded by the local Labor Union

“GOOD”

“BAD”

“MAYBE”

Astronaut's Suit

Grateful Dead® T-Shirts


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Other Personal Expenses with GSA’s AutoChoice Summer Program

  • Questions to ask:

    • Is there a reasonable relationship between the proposed expenditure and the purpose for which the funds were appropriated?

    • What is the benefit to the agency?

    • What is the benefit to the individual?

    • Is there a more cost effective way to achieve the agency mission or program goals?

  • Examples:

    • Registered traveler programs

    • Health promotion items

    • Recruiting items

    • Gifts and other giveaway items


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The Ever Popular Trinkets with GSA’s AutoChoice Summer Program

  • Legitimate only:

    • As part of an approved Awards program

    • Items of no intrinsic value designed solely to assist in achieving internal agency management objectives

    • In rare cases, ok where there is a direct connection between the expenditure and the execution of the agency’s mission; benefit to the government must outweigh the personal nature of the item

      • (Rule of thumb: with the exception of a legitimate award, if it’s something actually you’d want, you can’t have it.)


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Giveaway Items Held Proper with GSA’s AutoChoice Summer Program

  • Caps and other items distributed to a local residents in furtherance of threatened eider conservation plan – US Fish and Wildlife Service, B-318386, 12 August 2009

  • Gift cards for respondents to the Converter Box Coupon Program Survey - National Telecommunications and Information Administration, B-310981, 25 Jan 2008

  • Lava rocks distributed by National Park Service at Capulin Mountain National Monument, B-193769, 24 Jan 1979


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Examples of Improper Giveaway Items with GSA’s AutoChoice Summer Program

T-shirts with the CFC logo given to employees who contributed a certain amount

Ice scrapers imprinted with the logo “Don’t Drink and Drive”

Novelty plastic garbage cans containing candy in the shape of solid waste, given by EPA to attendees at an exposition

Decorative ashtrays given to conference attendees


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Commander’s Coins with GSA’s AutoChoice Summer Program

Three sources of funding

  • O&M – for awards pursuant to a properly established awards program; or pursuant to 10 USC § 2261 authority for recognition items

  • ORF – IAW SECNAVINST 7042.7K (for the Navy) or other relevant Instruction

  • OWN – for all others

    Caveats

  • Be wary of bona fide need

  • Personalization increases risk of obsolete stock upon departure


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Recognition Items for Recruitment/Retention with GSA’s AutoChoice Summer Program10 USC 2261

  • Allows appropriated funds to be used to procure items of nominal or modest value for recruitment/retention

    • to members of the armed forces, their families, and other individuals recognized as providing support that substantially facilitates service in the armed forces

    • “nominal or modest value” defined as a commemorative coin, medal, trophy, badge, flag, poster, painting, or similar item valued less than $50

  • B-307892, October 11, 2006

  • OASN(FM&C) memos dated November 9, 2006 and December 14, 2006


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Traditional Ceremonies with GSA’s AutoChoice Summer Program(i.e., Retirement, Change of Command)

Traditional ceremonies are considered official events

Authorized to use appropriated funds, government personnel, and other resources

Includes cost of printing/addressing/sending reasonable number of invitations, as appropriate

Does not include cost of food, beverages, or other entertainment

Presentation of award during a traditional ceremony does not permit use of appropriated funds to purchase food at follow-on reception or ceremony


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Commuting Expenses with GSA’s AutoChoice Summer Program

  • National Indian Gaming Commission – Reimbursing Bicyclists as Part of the Agency’s Transportation Fringe Benefit Program, B-318325, Aug. 12, 2009

    • Agency may use its authority under 5 USC 7905 to provide a $20 reimbursement to employees who commute to work by bicycle

  • Army – Mass Transit Benefits, Aberdeen Proving Ground, B-316381, July 18, 2008

    • A certifying officer does not have a responsibility to question the wisdom of a payment where there is clear agency policy


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Use of Government Resources with GSA’s AutoChoice Summer Program

  • B-277678, 4 January 1999

  • Joint Ethic Regulation, DoD 5500.7-R 3-201


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Social Networking with GSA’s AutoChoice Summer Program

  • Has been embraced by DoD

  • Can be a valuable tool

    • information dissemination

    • freeing workforce from answering repetitive questions

    • sharing best practices

    • information management

    • electronic learning


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however - with GSA’s AutoChoice Summer Program

  • Use caution with social networking, user generated content, and wikis

  • Do not combine personal and professional information.

  • When in doubt, talk to your lawyer!


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remember . . . with GSA’s AutoChoice Summer Program

  • “What happens in Vegas . . .” stays on YouTube, Facebook, Twitter

  • Ten seconds to post – it’s out there forever

  • Most Commands require users to sign statements regarding permissible use, etc.

  • IT Departments can detect spikes in online use; also can monitor content

  • Use Facebook, Twitter, etc. for personal use on personal time


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Use of Official Government Vehicles with GSA’s AutoChoice Summer Program

  • 31 USC 1344

  • 31 USC 1349 – penalty for violating 1344 is a suspension of at least one month


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For the Vast Majority of Us . . . with GSA’s AutoChoice Summer Program

Official Purpose

TAD Status


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Domicile to Duty Transportation with GSA’s AutoChoice Summer Program

Only as authorized by 31 U.S.C. § 1344, e.g. Secretaries and Chiefs of Staff, certain others as justified by command & control or security issues


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Ground Travel and Transportation with GSA’s AutoChoice Summer Program

Ground Transportation of Spouses

  • Spouses may ride in government vehicles to official events with their sponsors

  • Spouses may not ride by themselves in government vehicles to official events unless

    • the sponsor is authorized domicile-to-duty transportation and

    • it is impractical or impossible for the sponsor to accompany the spouse Duty-to-Duty Transportation


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Air Travel and Transportation with GSA’s AutoChoice Summer Program

Funded Travel of Spouses & Family Members

“Rare Exception” authorized only if

  • The family member actually participates in an “unquestionably official” function or capacity, or

  • Such travel is in the best interests of the United States because of a diplomatic or public relations benefit to the United States

    DoDD 4500.56, DoD 4515.13-R


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Air Travel and Transportation with GSA’s AutoChoice Summer Program

Unofficial travel of Spouses and Family Members of Senior Official on MilAir – also a rare exception:

Spouse/family member may accompany General Officer, SES and equivalents on official business if -

Travel is reimbursed at full coach fare

MilAir already scheduled for official trip

Spouse/family member cannot displace official travelers

Larger aircraft not required to accommodate spouse/family member travel


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