jmsmith Posted April 15, 2011 Report Share Posted April 15, 2011 Basic question and for the life of me I can't find the answer in the Red Book or Agency regulations. Scenerio is an FY08 O&M renovation. An inscope modification has come up and FY08 expired funds are not available. Must FY11 O&M funds be used, or could FY09 or FY10 expired O&M funds be used? FY09 and FY10 funds were used previously to fund inscope mods that occured in those respective years when FY08 funds were not available. Can you point me to the guidance? Link to comment Share on other sites More sharing options...
Guest Vern Edwards Posted April 15, 2011 Report Share Posted April 15, 2011 If the funds are "not available" because the deadline for obligation has passed, the funds remain available for in-scope modifications under the "antecedent liability" rule. The proper year to charge is the year that the contract was awarded. Those funds remain available even though they have expired. See Redbook, Vol. I, Ch. 5, B.7: For contracts spanning lengthy periods of time, funding of within scopemodifications involves the use of expired appropriations. As discussed later in this chapter, the balances in expired accounts prior to closing are available without further congressional action. and then see D.4: 31 U.S.C. ? 1552(a).?After the end of the period of availability for obligation of a fixed appropriation account and before the closing of that account under section 1552(a) of this title, the account shall retain its fiscal-year identity and remain available for recording, adjusting, and liquidating obligations properly chargeable to that account.? * * * Upon expiration of a fixed appropriation, the obligated and unobligated balances retain their fiscal year identity in an ?expired account? for that appropriation for an additional five fiscal years. As a practical matter, agencies must maintain separate obligated and unobligated balances within the expired account as part of their internal financial management systems in order to insure compliance with the Antideficiency Act. Also relevant in this connection is 31 U.S.C. ?1554(a), under which applicable audit requirements, limitations on obligations, and reporting requirements remain applicable to the expired account. During the 5-year period, the expired account balance may be used to liquidate obligations properly chargeable to the account prior to its expiration. The expired account balance also remains available to make legitimate obligation adjustments, that is, to record previously unrecorded obligations and to make upward adjustments in previously under recorded obligations. If the funds are "not available" for some other reason, let us know. Link to comment Share on other sites More sharing options...
jmsmith Posted April 15, 2011 Author Report Share Posted April 15, 2011 They are "not available" for some other reason, it's not entirely clear why from where I sit but local agency indicates they can't get O&M funds from FY08. The thought was they can use current year funds to cover the in scope modification but a question was raised as to whether or not they could use available expired funds from either FY09 or FY10. I thought I had read in a fiscal law course that funding for an O&M in-scope mod must first come from the year in which the contract was awarded and if not available, then from the current FY year. I may have misunderstood. The above is trying to have it come from a year in between award and the current FY. Thanks Link to comment Share on other sites More sharing options...
joel hoffman Posted April 15, 2011 Report Share Posted April 15, 2011 They are "not available" for some other reason, it's not entirely clear why from where I sit but local agency indicates they can't get O&M funds from FY08. The thought was they can use current year funds to cover the in scope modification but a question was raised as to whether or not they could use available expired funds from either FY09 or FY10.I thought I had read in a fiscal law course that funding for an O&M in-scope mod must first come from the year in which the contract was awarded and if not available, then from the current FY year. I may have misunderstood. The above is trying to have it come from a year in between award and the current FY. Thanks From my own experience with "local agencies" (Army O&M) , I don't believe that they aren't available in your case. They likely haven't gone up the chain to the ultimate expired account authorities. Link to comment Share on other sites More sharing options...
jmsmith Posted April 16, 2011 Author Report Share Posted April 16, 2011 From my own experience with "local agencies" (Army O&M) , I don't believe that they aren't available in your case. They likely haven't gone up the chain to the ultimate expired account authorities. Fair enough and you are more than likely correct. However, theoretically, if the funds are not available for whatever reason, what are the next funds that should be used to fund an in scope mod? Current year? Could it be any year, available O&M funds from between the year of award to the current FY? Thanks for the replies. Link to comment Share on other sites More sharing options...
joel hoffman Posted April 16, 2011 Report Share Posted April 16, 2011 Fair enough and you are more than likely correct. However, theoretically, if the funds are not available for whatever reason, what are the next funds that should be used to fund an in scope mod? Current year? Could it be any year, available O&M funds from between the year of award to the current FY?Thanks for the replies. I don't know and honestly don't want to look it up, because it might be used to conveniently violate the appropriations rules. I found that the "local"customer either didn't know or didn't bother to pursue finding the expired funds at higher levels within the Army. I don't know who in your user's organization is responsible for funding modifications, but their finance and accounting office should know the information that Vern quoted as well as the answer to your question. And I don't accept the excuse that nobody in an F&A office knows the rules. That is a sign of incompetency in government. Link to comment Share on other sites More sharing options...
jmsmith Posted April 16, 2011 Author Report Share Posted April 16, 2011 I don't know and honestly don't want to look it up, because it might be used to conveniently violate the appropriations rules. I found that the "local"customer either didn't know or didn't bother to pursue finding the expired funds at higher levels within the Army.I don't know who in your user's organization is responsible for funding modifications, but their finance and accounting office should know the information that Vern quoted as well as the answer to your question. And I don't accept the excuse that nobody in an F&A office knows the rules. That is a sign of incompetency in government. Joel, when you said "in your experience the local customer either didn't know, or didn't bother to pursue finding the expired funds", then was the mod execute with current year funds or was the mod not executed unless they could come up with expired funds from the year the contract was awarded? Unfortunately, I have two different finance offices suggesting two different things. Ultimately everyone, including legal, will be around a table to ensure no rules/laws are being broken. I'm not a finance person and was merely trying to get a little smarter on it. Thanks Link to comment Share on other sites More sharing options...
joel hoffman Posted April 16, 2011 Report Share Posted April 16, 2011 Joel, when you said "in your experience the local customer either didn't know, or didn't bother to pursue finding the expired funds", then was the mod execute with current year funds or was the mod not executed unless they could come up with expired funds from the year the contract was awarded? Unfortunately, I have two different finance offices suggesting two different things. Ultimately everyone, including legal, will be around a table to ensure no rules/laws are being broken. I'm not a finance person and was merely trying to get a little smarter on it. Thanks Jm, actually the ACO, allowed the contractor to proceed at its own risk on the work, after sending the mod package up from Panama, because it exceeded his authority. The lawyer caught the funding problem during legal review. The PCO, the Chief of Construction and the District Engineer all were going to officially crucify the ACO for allowing work to proceed without a mod, especially one that had no proper funding. However, I reminded all of them that they never directed the contractor to stop, even a month after they knew about the funding and the situation. Since they were as "dirty" as the ACO, they dropped the action but directed the Contractor to stop the mod work. The customer went back and got the correct funds. Turns out this wasn't an isolated instance, so we had to find the other mods and go back and switch funds. The KO can't knowingly issue an incorrectly funded mod. It was our contract, so the KO was legally responsible to ensure that the correct appropriation is used. From that point on, the user had to provide original year funds or provide evidence from Department of the Army that there no more original year funds. Link to comment Share on other sites More sharing options...
joel hoffman Posted April 16, 2011 Report Share Posted April 16, 2011 Duplicate Link to comment Share on other sites More sharing options...
Don Mansfield Posted April 18, 2011 Report Share Posted April 18, 2011 jmsmith, You can only obligate funds that are available for obligation. In your case, FY08 funds are available because of the antecedent liability rule that Vern quoted above. You have a liability that "relates back" to FY08. From what you have written, you do not have a liability incurred in FY09 or FY10 that would allow you to take advantage of the antecedent liability rule--nothing "relates back" to those fiscal years. As such, those funds are not available for obligation (assuming that they were annual appropriations). So your choices are to use FY08 funds, FY11 funds, or break the law. Link to comment Share on other sites More sharing options...
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