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Federal Appropriations Law: A Primer

Federal Appropriations Law: A Primer. James F. Nagle Oles Morrison Rinker & Baker LLP www.oles.com nagle@oles.com. What is Federal Appropriations Law. Fiscal law The body of law that governs the availability and use of federal funds

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Federal Appropriations Law: A Primer

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  1. Federal Appropriations Law: A Primer James F. NagleOles Morrison Rinker & Baker LLP www.oles.com nagle@oles.com

  2. What is Federal Appropriations Law • Fiscal law • The body of law that governs the availability and use of federal funds • GAO Principles of Appropriations Law, Volume I, page 1 to 2 Federal Appropriations Law: A Primer

  3. Congress’s Role • Decides whether to fund • How much and how long to fund • Sets terms and conditions of use Federal Appropriations Law: A Primer

  4. Role of GAO • Financial and Program Audits • Legal Opinions • Legal Decisions • Publishes the Red Book Federal Appropriations Law: A Primer

  5. Three Phases of an Appropriation • Period of Availability • Expired Phase – Five Years • Closure – Returns to Treasury Federal Appropriations Law: A Primer

  6. Specific versus General Appropriations • Agency must use Specific Appropriation to the exclusion of General Appropriation • Amount in Specific Appropriation is a ceiling • Once Specific Appropriation is exhausted, cannot use General Appropriation • Two Appropriations available for the same purpose – Use the “Rule of Election” and be consistent Federal Appropriations Law: A Primer

  7. Rules of Fiscal Law • The propriety of the use of funds depends on three things • The Purpose of the obligation or expenditure • The obligation must occur within the Time limits applicable to the Appropriation • The obligation expenditure must be within the Amounts that Congress has established Federal Appropriations Law: A Primer

  8. Purpose • The Purpose statute, 31 U.S.C. 1301 (a) • Necessary Expense doctrine • The expenditure must be a logical relationship to the Appropriation charged • Must not be prohibited by law • Must not be otherwise provided for Federal Appropriations Law: A Primer

  9. Examples of Necessary Expense Issues • Clothing • Water • Office Equipment • Business Cards • Entertainment Federal Appropriations Law: A Primer

  10. Time Limitations • Type of Appropriation / Duration • Annual • Multi-year • No year Federal Appropriations Law: A Primer

  11. Bona fide Needs Rule • A fiscal year appropriation may be obligated only to meet a legitimate, or bona fide, need arising in, or continuing to exist, in the fiscal year for which the appropriation is made Federal Appropriations Law: A Primer

  12. Bona Fide Needs • Supply contracts • Services contracts • Non Severable – same as supply contracts • Severable – normally charge appropriation when services are rendered – but major exceptions Federal Appropriations Law: A Primer

  13. Amount – the Anti-Deficiency Act • Cannot obligate the government in advance of or in excess of an Appropriation • Cannot accept voluntary services • Issues • Indemnifications • Change Orders • Options • Judgment Fund Federal Appropriations Law: A Primer

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