Advanced Appropriations Law Seminar

Advanced Appropriations
Law Seminar

Solutions Guide, Version 4.2

Graduate School

Washington, DC 20024

(888) 744-GRAD

www.graduateschool.edu

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Introduction

Table of Contents

Case Study 1

Complying With Congressional Intent 3

Case Study 2

The Conference 11

Case Study 3

The Mind Boggling Study 21

Introduction

This Advanced Appropriations Law Seminar Solutions Guide contains the solutions to the three case studies presented in the Advanced Appropriations Law Seminar course. The three case studies are the following:

· Case Study 1: Complying With Congressional Intent

· Case Study 2: The Conference

· Case Study 3: The Mind Boggling Study

Solutions Printed in Bold

To help you easily locate the solutions to the specific issues questions, the solutions are printed in bold after each question in this solutions guide.

Important Reminder

As with most legal issues, the subject matter is constantly changing and we urge you to adopt practices that will help you stay current after you complete this Advanced Appropriations Law Seminar course.

Graduate School 1 Advanced Appropriations Law Seminar

Case Study 1

Complying With
Congressional Intent

Case Study 1 • Complying With Congressional Intent

Specific Issues: Case Study 1

Finding 1

An audit report alleges a number of violations of appropriations law have been committed by the agency. You are the accountable certifying officer and you have been directed to either defend the actions of the agency or to carry out the findings in the audit that would entail a number of cost transfers and ultimately result in Antideficiency Act violation(s). Answer the following questions to aid you in determining the proper course of action.

Facts of the Case

· An agency was audited by an external audit agency

· Two findings—when combined create a third finding

· The agency CFO disputes the findings

Finding 1

· The agency exceeded a maximum ceiling on an earmark

Finding 2

· The agency failed to award grants to specific grantees as directed by Congress. Accordingly, the agency violated 31 U.S.C. 1341, an Antideficiency Act provision.

Refer to the Agency Responses to Findings 1 and 2.

Issue 1: Analysis of Specific Congressional
Stipulations in the Committee Reports/Act

1. Regarding the wording for the Adolescent Seatbelt Safety Study: How much did each report/act stipulate for the Seatbelt Safety Study? Tab 1A

House Report: $ 4 million

Senate Report: $ 6 million

Conference Report: $ 6 million

Appropriation Act: $ 6 million

2. Regarding the wording for the Christopher and Dana Reeve Resource Center, how much did each report/act stipulate?

House Report: $ 3.017 million above PB request

Senate Report: $ 1 million

Conference Report: $ 2.5 million

Appropriation Act: $ 0

3. Regarding the wording for the Christopher Reeve Paralysis Foundation, how much did each report/act stipulate?

House Report: $ 1 million over FY07

Senate Report: $ 0

Conference Report: $ 0

Appropriation Act: $ 0

4. Regarding the wording for the indirect and overhead tax for the Adolescent Seatbelt Safety Study how much did each report/act stipulate?

House Report: NTE 7+3%

Senate Report: $ 465 million for all tax categories

Conference Report: NTE 7+3%

Appropriation Act: NTE 10%

NTE = Not to exceed

Issue 2: Analysis of Earmarks, Ceilings, and Floors and Transfer and Reprogramming

1. What are earmarks? (Tab 1B).

Congress uses earmarks to establish preconditions on specific programs thus controlling the agency’s use of the appropriation.

2. Are they different from line items? Explain.

Line items are appropriations for a specific purpose. The entry in the Act appropriating $212 million (no-year account) for facilities purposes is an example of a line item appropriation within a general (lump sum) appropriation. The Adolescent Seatbelt Safety Study, however, is an earmark.

3. What are the various terms Congress uses to impose ceilings and floors on appropriated amounts?

“Not to exceed”; Not less than”; “Including”; “Shall be available”.

4. With respect to the Adolescent Seatbelt Safety Study, did Congress specify the amount as a ceiling, a floor, or both?

Congress used the term “shall be available”. Case law has construed such language to represent both a ceiling and a floor. A review of the committee reports does not reveal a more specific intent.

5. If Congress wishes to bind an agency to obligate specific amounts for specific purposes must the specific amounts be in separate appropriation acts? Explain

No. The use of earmarks and line item appropriations is a Constitutionally acceptable substitute for specific individual appropriations, which, of course, Congress may do if so inclined.

6. Do the rules on transfers and reprogramming differ? Explain?

- Yes.

- Transfer is the movement of obligation authority between appropriations.

- Reprogramming is the movement of obligation authority within an appropriation.

7. The Appropriation Act gave the agency general transfer authority. What were the unconditional terms of that authority? (What percent may be transferred out and what percent may be transferred in?) (Tab 1A)

The agency may transfer up to 1 percent out of an appropriation provided the gaining appropriation is not increased by more than 3 percent.

8. There was also a conditional transfer authority. What were its terms?

The agency may increase the gaining appropriation by an additional 2 percent after approval by the Committees on Appropriations in both houses of Congress.

9. Were those terms Constitutional (INS v. Chadha)? (Tab 1B)

- No. The effect of the ‘approval condition’ would place the President in a subordinate position to individual committee chairmen in the Congress.

- In the INS v. Chadha decision, the Supreme Court ruled that it would be unconstitutional for the Congress to convey powers to itself which were not granted by the Constitution’s Article I.

Issue 3: Analysis of Legal Requirements in the Legislative Process

1. What is the principle of appropriations law regarding the legal effect on the agency to comply with instructions specified in legislative history documents? (Tab 1B)

Legislative history is not law. Comments, indicia and instructions contained in legislative history documents (i.e. testimony, hearings, committee reports, floor debates, etc.) not carried forward into the act are not legally binding on federal agencies.

2. If the agency wanted to increase or decrease the amount they plan to obligate on the Adolescent Seatbelt Safety Study, how would they affect the change? Explain. (Tab 1B)

a. Reprogramming

► b. Transfer

Earmarks carried forward into the act are legally binding on the agency and must be treated as if they are separate appropriations. Therefore, ‘Transfer’ authority is necessary to move amounts in or out.

3. Using the unconditional transfer authority, may the agency transfer an amount of obligation authority into the Seatbelt Safety Study account? And, if so, how much? (A calculator is available if needed.) (Tab 1A)

The agency may Transfer 1% from the more general account up to 3% into the earmark. Thus $180,000 may be transferred into the study.

4. Using the added conditional authority in the Act, how much more may be obligated on the Study?

- An additional $120,000 (2%) may be Transferred into the study with prior notification of the Appropriations Committees of Congress.

- With Transfer authority, Congress permits between $6.0 and $6.3 to remain available.

Another point:

- The Transfer authority would have also permitted the agency to transfer up to 1% ($60,000) out of the earmark into the more general accounts in the lump sum appropriation.

5. Considering only the committee reports and the Appropriation Act, did the audit report correctly conclude that the agency illegally failed to comply with Congressional intent regarding the following earmarks?

► a. Adolescent Seatbelt Safety Study

Only the Seatbelt Study is in question.

The intent of Congress regarding this earmark is that $6 million be available for the study. The agency actually obligated $6,673,200 without notifying the Appropriations Committees.

b. Christopher and Dana Reeve Resource Center

c. Christopher Reeve Paralysis Foundation

d. Indirect and overhead tax

Another point:

- The focus so far has been on the excess amount transferred into the study. Congress will also inquire into the effects on the “source accounts” for the extra money spent on the study.

Issue 4: Analysis of Office of Management and Budget Actions and Authorities

1. What statute directs OMB to apportion appropriated amounts to executive agencies?

The Antideficiency Act. (Specifically 31 U.S.C. 1512 & 1513.)

2. In doing so, may OMB prescribe conditions on the use of appropriated funds which:

a. Are consistent with the Appropriation Act or other law? Certainly

b. Provide for additional conditions not otherwise prohibited by law which are within the President’s discretionary powers? Yes

3. With respect to amounts in the OMB Apportionment, how much, if any, of the following legislative earmarks are legally binding on the agency?

► a. Adolescent Seatbelt Safety Study

OMB imposed a ceiling of $6 million on study obligations

b. Christopher and Dana Reeve Resource Center

c. Christopher Reeve Paralysis Foundation

► d. Indirect and overhead tax

OMB limited the costs for other than direct charges to 7%.

4. Regarding the Adolescent Seatbelt Safety Study, is the agency correct when it states that, “no overobligation of the appropriation occurred thus no ADA violation was committed”? Explain. (Tab 1B)

The statement is incorrect. A violation of a statutory provision (i.e. quarterly limits, ceilings, floors, etc.) within an appropriation is a violation of law.

Issue 5: The Antideficiency Act

In conclusion, with respect to the finding that the Antideficiency Act has been violated:

1. Is an earmark that is found solely in a committee report legally binding on the agency? (Tab 1B) No

2. If the earmark is not in the appropriation act but is documented as a Category B apportionment, would your answer above be different? (Tab 1B)

Yes, OMB apportionments can convey legally binding conditions on the agencies.

3. These are the Summary findings on Page 14 of the Audit Report:

Finding 1: The agency overobligated a specific Congressional ceiling imposed in an Earmark. They also failed to observe an OMB ceiling on general operating costs.

a. Adolescent Seatbelt Safety Study

b. Indirect and overhead tax

Finding 2. The agency did not award grants to the grantees in the amounts specified in the legislative documents.

a. Christopher and Dana Reeve Resource Center

b. Christopher Reeve Paralysis Foundation

The effect of the above two findings is that the agency has violated 31 U.S.C. 1341 and/or 31 U.S.C. 1517 both reportable violations of the Antideficiency Act.

4. Which, if any, of the following accounts were obligated in violation of the Antideficiency Act? Enter the statute that was violated and how.

► a. Adolescent Seatbelt Safety Study

31 U.S.C. 1341 (violated statutory transfer authority) and
31 U.S.C. 1517 (overobligated an OMB ‘not to exceed’ limitation).

b. Christopher and Dana Reeve Resource Center

c. Christopher Reeve Paralysis Foundation

► d. Indirect and overhead tax

31 U.S.C. 1517 (Overobligated an OMB ‘not to exceed’ limitation).

Graduate School 9 Advanced Appropriations Law Seminar

Case Study 2

The Conference

Case Study 2 • The Conference

Lesson 2 Objectives

Within the context of the case study, you will learn how to analyze and apply principles of law relating to:

· Purposes for use of appropriations

· Augmentation of appropriations through use of miscellaneous receipts

· Antideficiency Act implications

Facts of the Case

A Military Commander Hosts a Conference

· Attended by government and non-government persons

· Commander has one-year appropriation

· Identified in the Conference Report for purposes covered by the conference

· No other specific authority

· No Reception and Representation money.

Types of Costs

· Hotel conference facilities and related audio-video equipment

· Conference books and materials; name plates; briefcases; mementos and plaques

· Equipment display of a drone aircraft

· Travel costs for nonfederal attendees

· Jerseys for facilitators

· Guest speaker costs (travel, honoraria)

· Social functions

· Commercial bus transportation for a local shuttle

You are the certifying/approving official for all costs for this conference.

Specific Issues: Issue 1

With respect to hosting a conference (Tab 2B):

1a. May a federal agency host a meeting involving non-federal attendees?

Yes

1b. What is the authority?

5 U.S.C. 4110; 31 U.S.C. 1301(a); Necessary Expense Doctrine or other specific statutory authority.es

Specific Issues: Issue 2

To ensure all non-federal invitees can attend (Tab 2B):

2a. By what authority may an agency pay travel costs and transportation costs of non-federal attendees?

5 U.S.C. 5703, 5 U.S.C. 4110 and CG Decision B-300826 permit such payments when they are deemed necessary for a successful conference.

2b. By what authority may an agency pay honoraria and travel expenses to guest speakers?

5 U.S.C. 4110, 5 U.S.C. 5703, 31 U.S.C. 1301 (a), A-69906 and B-20517.

2c. Is the commercial bus transportation an authorized expense?

Yes and no. Yes, for trips required to conduct authorized conference events. No, for such events as the golf outing.

Require the project officer to give a detailed breakout of all bus use.

Specific Issues: Issue 3

With respect to the conference materials (Tab 2 B):

3a. May the command incur obligations for conference handouts in three-ring binders, tablets, and registration table supplies.

Yes. 31 U.S.C. 1301(a). These are normal operating expenses incidental to most conferences.

3b. May the command furnish a “secure briefcase” to each attendee, including the non-federal attendees, to keep after the conference has concluded.

Not without authority. They would be classified as gifts.

3c. May the command present mementos to speakers and distinguished civilian guests/attendees?

No. These are expenses properly charged to reception and representation funds that are not available to the command.