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Guest Vern Edwards
Can a solicitation be issued today and contract awarded today for services to begin in 2013 using no year funds although the need developed in FY2012?

See 1 Principles of Federal Appropriations Law 3d, pages 5-7 through 5-8:

A no-year appropriation is available for obligation without fiscal year limitation. For an appropriation to be considered a no-year appropriation, the appropriating language must expressly so provide. 31 U.S.C. ? 1301( c). The standard language used to make a no-year appropriation is ?to remain available until expended.? 40 Comp. Gen. 694, 696 (1961); 3 Comp. Dec. 623, 628 (1897); B-279886, Apr. 28, 1998; B-271607, June 3, 1996. However, other language will suffice as long as its meaning is unmistakable, such as ?without fiscal year limitation.? 57 Comp. Gen. 865, 869 (1978).

Unless canceled in accordance with 31 U.S.C. ? 1555 or rescinded by another law, there are no time limits as to when no-year funds may be obligated and expended and the funds remain available for their original purposes until expended. 43 Comp. Gen. 657 (1964); 40 Comp. Gen. 694 (1961). This includes earmarks applicable to the use of no-year funds since they are coextensive with, and inseparable from, the period of availability of the no-year appropriation to which they relate. B-274576, Jan. 13, 1997.

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Perhaps the question arises because of the bona fide need rule. However, the bona fide need rule does not apply to no-year appropriations. See the GAO decision at http://www.gao.gov/decisions/appro/317636.htm.

A no-year appropriation is available for incurring obligations for an indefinite period, usually until the objectives have been accomplished. This is different from a revolving fund, though. You need to make sure you really have no-year funds using the same definition as used by the GAO and others.

Sometimes, an agency's internal rules will require the treatment of no-year funds essentially as one-year funds. This is an internal agency decision that does not change the ultimate fact that the bona fide need rule does not apply to no-year appropriation.

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  • 3 weeks later...

Hello ji20874

I thought revolving funds are ?no year? funds. See, e.g., Department of Defense Appropriations Act, 2000, Pub. L. No. 106-79, 113 Stat. 1212 (1999). Although, revolving funds are not dependent upon annual appropriations and the Bona Fide Needs Rule does not normally apply I think there are restrictions. See 10 U.S.C. ? 2213(a) (limiting the acquisition of any supply item to 2 years of operating stock); U.S. GEN. ACCOUNTING OFFICE, REPORT TO CONGRESS, DEFENSE WORKING CAPITAL FUND: IMPROVEMENTS NEEDED FOR MANAGING THE BACKLOG OF FUNDED WORK (2001). See also, Matter of: Implementation of the Library of Congress FEDLINK Revolving Fund, B-288142, Sep. 6, 2001; Matter of: Continued Availability of Expired Appropriation for Additional Project Phases, B-286929, Apr. 25, 2001 (it is still improper to ?bank? an agency?s annual funds with a GSA account to cover future year needs). So what are the differences between no year and revolving funds?

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Guest Vern Edwards
So what are the differences between no year and revolving funds

Although revolving funds are similar to "no year" funds in the sense that there is no fiscal year limitation on obligation, there are a number of differences.

A revolving fund is a "permanent" appropriation, a special fund, which, once established, no longer depends on appropriations acts as its source of money. Although the rules of "no year" appropriations apply to a revolving fund in in the sense that there is no fiscal year limitation on obligations, the money does not come from a "no year" appropriation statute. (The FEDLINK decision held that money deposited in a revolving fund that comes from another agency's appropriation retains its character and that the limitation on obligations in the source appropriation continues to apply to it. Thus, "banking" doesn't work.)

One example of the difference between "no year" funds and revolving funds is that most revolving funds may be augmented if done properly. Another difference is that while GAO considers revolving funds to be appropriated funds, some courts have held that they are not appropriated funds for some purposes. Yet another difference is that a "no year" appropriation will be closed if there are no disbursements from it for two consecutive fiscal years, while a revolving fund can continue open as authorized by its originating statute.

There are too many differences between revolving funds and "no year" appropriations to discuss in this limited forum. See GAO's Principles of Federal Appropriations Law for extensive discussions throughout, but mainly in Vol. 1, Chapters 2 and 4, Vol. 2, Chapter 6, and especially Vol. 3, Chapter 12. There is a succinct general discussion of revolving funds in Manuel and Yeh, Interagency Contracting: An Overview of Federal Procurement and Appropriations Law (Congressional Research Service, 2010), available at http://assets.opencrs.com/rpts/R40814_20101001.pdf.

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