Who's responsible to request funding?

[Delayn]

There is a debate in my agency on who is responsible for requesting funding to the Comptroller and at what point in the contract process funding must be provided.  Currently the program office submits a requirements package to Contracts and Finance.  However, Finance does not want to provide funding or availability of funding promise for the requirement until Contracts submits a request for funding, which must include the contract number, contractor, purpose, and exact amount to be funded.  In several occasions, Contracts is ready to award a contract; however finance stops the award since there is no funding for the contract.   My opinion is that the Program Office is responsible to request funding to Finance and provide it to Contracts as part of the requirements package.  Also my understanding is that Contracts is not supposed to start the contract process until funding or availability of funding notice has been received.  This has been an ongoing battle between Finance and Contracts for a couple of years now and the process would not change if I do not show an instruction showing otherwise.  Any advice?

[Guest Vern Edwards]

There is no governmentwide rule, policy, or procedure. Each agency makes its own.

[policyguy]

FAR 32.702 -

"32.702 Policy.
No officer or employee of the Government may create or authorize an obligation in excess of the funds available, or in advance of appropriations (Anti-Deficiency Act, 31 U.S.C. 1341), unless otherwise authorized by law. Before executing any contract, the contracting officer shall—

(a) Obtain written assurance from responsible fiscal authority that adequate funds are available or

(b) Expressly condition the contract upon availability of funds in accordance with 32.703-2."

 

[jwomack]

 

17 hours ago, Delayn said:

My opinion is that the Program Office is responsible to request funding to Finance and provide it to Contracts

Why is this your opinion?

 

17 hours ago, Delayn said:

my understanding is that Contracts is not supposed to start the contract process until funding or availability of funding notice has been received

Why is this your understanding?

[Retreadfed]

Delayn, what is the rationale for this process?  From a contractor's perspective, this seems like a poor business practice.  What information is provided to offerors in regard to funding when a solicitation is issued?  If I were a contractor who submitted a proposal then had the procurement canceled because the government did not have funding available for the contract I would be ticked off.  If this was a recurrent theme with the agency, I would be tempted to stop dong business with that agency.  Also, it seems like a waste of government resources to go through the procurement process then find out that there is insufficient funding for the procurement.

[Guest Vern Edwards]

In my experience, the program office's "program control" function managed the program's funds. The program office would send a purchase request to contracting citing the appropriate funds account number and stating a dollar amount. The CO would then submit a form to the finance office requesting an administrative commitment of funds from the funds associated with the funds citation in the amount stated in the purchase request. Upon receipt of the administrative commitment the CO would commence the contracting process. If, before award, the CO required more funds, he or she would request additional funding from the program office.

[joel hoffman]

While there may not be a government -wide rule, it would seem where there is a “Program Office”, that the program or project manager is responsible for managing and requesting funds for a contract.  

The  Army Corps of Engineers uses a financial management system called “CEFMS”.

For construction contracts,  A/E, services, a program or project manager is assigned to manage the program or project, including funds. Contracting isn’t responsible for requesting funds. The respective PM will request funds and set up funding in CEFMS with F&A. The KO obligates the funds.  

[Guest Vern Edwards]

The president requests funds. Congress appropriates funds and authorizes obligations. OMB apportions funds to agencies. The agencies allots funds within. The program office receives funds, manages them, and requests acquisitions. The CO requests an administrative commitment of funds to set them aside and ensure that the funds will be available for obligation. The accounting and finance office accounts for the funds and pays the bills.

[Desparado]

Delayn - In my opinion, if your office believes that this is the appropriate course of action, all solicitations would need to go out with the Availability of Funds clause (52.232-18).  This would put the contractors on notice that there are not funds currently committed to this acquisition.

[Don Mansfield]

4 hours ago, Desparado said:

Delayn - In my opinion, if your office believes that this is the appropriate course of action, all solicitations would need to go out with the Availability of Funds clause (52.232-18).  This would put the contractors on notice that there are not funds currently committed to this acquisition.

I think that clause is for use when funds haven't been appropriated--not when funds have been appropriated but haven't been committed. FAR 32.703-2(a) states:

Quote

 

Fiscal year contracts. The contracting officer may initiate a contract action properly chargeable to funds of the new fiscal year before these funds are available, provided that the contract includes the clause at 52.232-18, Availability of Funds (see 32.706-1(a)). This authority may be used only for operation and maintenance and continuing services (e.g., rentals, utilities, and supply items not financed by stock funds)—

(1) Necessary for normal operations; and

(2) For which Congress previously had consistently appropriated funds, unless specific statutory authority exists permitting applicability to other requirements.

 

I've worked in contracting offices that required a commitment of funds before accepting a purchase request. I've also worked in a contracting office that had to wait until award was about to be made before the finance office would commit funds. In the latter case, the finance office was chasing a metric. They were measured on "Committed funds not obligated". The goal was to keep that as low as possible. 

[Delayn]

On 4/16/2018 at 10:09 AM, Retreadfed said:

Delayn, what is the rationale for this process?  From a contractor's perspective, this seems like a poor business practice.  What information is provided to offerors in regard to funding when a solicitation is issued?  If I were a contractor who submitted a proposal then had the procurement canceled because the government did not have funding available for the contract I would be ticked off.  If this was a recurrent theme with the agency, I would be tempted to stop dong business with that agency.  Also, it seems like a waste of government resources to go through the procurement process then find out that there is insufficient funding for the procurement.

Agree.