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Advanced AppropriationsAdvanced Appropriations

Law SeminarLaw SeminarSolutions Guide, Version 4.2

FINC9100-S

Graduate School USAWashington, DC 20024

(888) 744-GRADwww.graduateschool.edu

Copyright © 2004-2013 by FedTrain, Inc.

All rights reserved. No portion of this manuscript may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without permission in writing from the copyright holder, FedTrain, Inc., 2451 Cumberland Pkwy, MS-3698, Atlanta, GA 30339

This material has been reprinted by the Graduate School USA for use in FINC9100 with the permission of FedTrain, Inc. V4.2.

Introduction

Table of Contents

Case Study 1Complying With Congressional Intent 3

Case Study 2The Conference 11

Case Study 3The Mind Boggling Study 21

Graduate School USA 1 Advanced Appropriations Law Seminar

Introduction

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.

Advanced Appropriations Law Seminar 2 Graduate School USA

Case Study 1Case Study 1

Complying With Congressional Intent

3

Case Study 1 • Complying With Congressional Intent

Specific Issues: Case Study 1

Finding 1An 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?


OMB imposed a ceiling of $6 million on study obligations




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 ActIn 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.


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.


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




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



The Conference

11

Case Study 2 • The Conference

Module 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 CaseA 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 1With 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.

Specific Issues: Issue 2To 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 3With 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.

3d. What is the authority?

There is no authority for these items. Without specific authority or R&R funds, payment of these items would be illegal.

Specific Issues: Issue 4Regarding the loaned equipment for display at the conference (Tab 2 A and Tab 2 C):

4a. May the command pay shipping costs for a private company to send equipment for display at the conference?

Yes.


31 U.S.C. 1301(a); Necessary Expense Doctrine

4c. May the command pay an insurance premium to insure the property at the insistence ofthe company?

Yes, if there are no other alternatives.

4d. What is the authority?

B-151876 (1964)



Specific Issues: Issue 5Regarding the no-host social mixer (Tab 2 E):

5a. May the agency pay for the ‘no-host’ social mixer?

No. If substantial conference functions were conduced during the mixer and it met the other elements of B-300826, payment may be allowed. There is no evidence in the case study that substantial conference functions were conducted in conjunction with the ‘no-host mixer’.


There is none unless the requirements of B-300826 were met.

Specific Issues: Issue 6Regarding the social outing (Tab 2 A, Tab 2 B, and Tab 2 E):

6a. May the agency pay for the ‘by invitation only’ social function?

No. B-300826 can’t cover this one.


The ‘social function’ is classified as entertainment and thus prohibited.

Specific Issues: Issue 7Regarding refreshments and meals during the conference (Tab 2 E):

7a. May the 67 federal travelers be reimbursed the full amount of the registration fee?

No. If the refreshments served at the ‘no-host social mixer’ qualifies under the GSA rule or B-300826, payment may be authorized for that portion.

Realistically, however, the travelers will be filing their travel vouchers upon return to their parent locations and certifying officials there will not be aware of the conference details. Thus, they will probably be reimbursed the registration fee.

7b. May the 187 local federal attendees be reimbursed the full amount of the registration fee?

No. There is no authority except possibly B-300826 which it is inapplicable per the details of the case study scenario.



7c. May the 211 non-federal attendees be furnished the free meals and refreshments using appropriated funds?

Yes for the official, non-entertainment functions. B-300826.

7d. May the 187 local federal attendees be furnished the free meals and refreshments using appropriated funds?

Yes for the those official, non-entertainment related, functions. The 67 federal travelers should report the free meals on their travel vouchers for appropriate per diem offsets.

7e. What is the authority?

B-300826. However, not all food may qualify. The no-host mixer and the golf outing are out.

Specific Issues: Issue 8With respect to the jerseys for the facilitators (Tab 2 D):

8a. Under what conditions may the agency purchase clothing for federal employees?

Safety; Unusual items, necessary to accomplish the mission, hazardous conditions; and Uniforms

8b. May the agency provide jerseys for the conference facilitators?

None of the above conditions are present. The jerseys are not authorized.

8c. What is the authority?

None. The employees should be required to return the jerseys for disposition under property regulations.



Specific Issues: Issue 9Regarding the disputed purchases (Tab 2 F):

9a. Does the Federal Acquisition Regulation (FAR) provide a means to ratify purchases that are not in accordance with law and procedure?

Yes.

9b. Who has the authority to ratify purchases which appear to be unauthorized commitments?

The head of the contracting agency. It may be delegated to no lower than the head of the contracting office. The certifying officer should refer all questionable purchases to the contracting officer for a determination under the FAR.

Specific Issues: Issue 10The command collected $16,000 in registration fees (Tab 2 G and Tab 2 H):

10a. Generally, what is the rule regarding money received by and for the government from outside sources?

Monies received outside appropriations must be deposited in the Treasury as miscellaneous receipts.

10b.What is the governing statute?

31 U.S.C. 3302(b), the Miscellaneous Receipts statute.

10c. How does the NIH case (B-300826) apply regarding the use of conference registration fees.

The NIH decision affirms that federal agencies cannot, without statutory auathority, engage in the sale of goods or services to the public and retain those proceeds for agency purposes.

But, the 2007 DoD Authorization Act gives DoD the authority to collect and retain conference fees.



10d.What should the certifying official do with respect to the money in the bank account?

Because this is a DoD sponsored conference, the fees collected may be used to defray legitimate conference expenses.

Since the amounts were collected by the DoD for DoD purposes and the attendees were reimbursed for the charges, the amounts may not be used for unauthorized functions or purchases.

Prepare a listing of the charges that you would not certify for payment unless ratified by an authorized contracting official.

Specific Issues: Issue 11

11. If the command had contracted with a private firm to manage the logistics of the conference under a no-cost contract would your answers be different?

Assuming the command had not contracted for the two social events, the jerseys, briefcases, and mementos to speakers, the contractor would have provided those amenities voluntarily. However, an agency may not request a contractor to provide unauthorized amenities under such an arrangement. If voluntarily provided by the contractor, the registration charge is reimbursable to all attendees.


Line No. Description Amount

1.6 No-host mixer reception $ 4,000

2.1 Secure briefcases TBD

2.2 Mementos and plaques to guest speakers TBD

6 Golf social outing $ 12,000

7 Bus contract for unofficial trips TBD

8 Facilitator jerseys $ 1,558


Specific Issues: Issue 12

12a. Assume the command conducted the conference after and did not obtain prior approval for the conference pursuant to the OMB and DoD memos relating to conferences (refer to Tab 2J in the Participant Manual). Does the DoD memo impose legally binding restrictions on the use of DoD appropriations for conference expenses?

Yes. The Administrative Procedures Act establishes that a properly imposed restriction on an official’s discretion is attached to the applicable law as if congress itself had imposed the restriction in the Act. Thus, when DoD prescribed limitations on the use of appropriations for conferences it implicitly imposed a 31 USC 1301(1) restriction on DoD appropriations. A violation of 31 U.S.C. 1301(a) can rise to a reportable violation of 31 U.S.C. 1341(a)(1).

12b.Would any of the expenses for the conference be legal?

No

12c. If not, is there a potential reportable Antideficiency Act violation?

Yes, as mentioned above the ADA would have been violated. While the DoD memo does not address retroactive waivers of the DoD policy (nor does the OMB memo) presumably the command could request same. If granted, the legitimate expenses of the conference would be legal. The illegitimate expenditures would still have to be addressed in a probable ADA investigation.



Conclusion of Case Study 2 The conference was legally held.

Purchases classified as gifts and entertainment are prohibited.

Contracts should only be awarded for legitimate appropriated fund purposes. Amounts for items as unauthorized food, mementos, social outings and so forth must not be included in the contracts.

Clothing may only be purchased with statutory authority. No authority for the jerseys exists.

Payments for travel of nonfederal persons are authorized if, (1) necessary to ensure the success of a formal government sponsored conference or, (2) they are performing a direct service.

Collections for items not authorized by appropriations belong to the Treasury as miscellaneous receipts.

Use of a no-cost contract to accomplish conference functions is authorized. As such a registration/attendance fee charged by the contractor would be reimbursable. Agency officials should not request unauthorized amenities from the contractor.

Amounts paid by attendees for unauthorized items (social functions, etc.) may be collected on a voluntary basis outside the purview of the U.S. Government.

When done so:

– The voluntary contributions are not collected ‘for the United States’ and thus not subject to 31 U.S.C. 3302(b).

– The resulting payments are then accomplished outside the terms of a government contract.

– The amounts would not be reimbursable to the attendees as “registration fees.”



The Mind Boggling Study

21

Case Study 3 • The Mind Boggling Study

Specific Issues: Issues—Part AObviously, the accounting supervisor and the project manager are in total disagreement regarding the nature of the contract and the obligation rules. It is a firm fixed-price contract calling for specific deliverables on specific dates. Payments under the terms of the contract are to be made upon completion of the specific milestones. Phases 1, 2 and 3 are ordered to be completed in FY 09 with the remaining phase subject to the availability of funds. The legal questions that emerge with respect to obligations and payments are as follows.

With respect to the timing of the recording of the contractual obligation (Tab 3 A):

1a. When is a contract a recordable obligation?

When an event is initiated that creates a binding commitment on the part of the government.

1b. What effect does the expiration of an appropriation have on recording obligations?

New obligations cannot be created. Adjustments are authorized.

1c. What is the correct obligation date for this contract, September 25, 2008 (FY 08) or October 4, 2009(FY 09)?

September 25, 2004. This is the date the government’s liability was effective, firmand certain.

With respect to the amount of the obligation for the contract (Tab 3 A):

2a. What distinguishable characteristics mark the differences between a contract that is severable and one that is non-severable (entire)?

Severable contracts involve work that is continuing and recurring in nature, or which can logically be separated in terms of performance. Non-severable contracts are of a single undertaking which cannot logically be separated in terms of performance, such as a project.

2b. In what ways, if any, do 41 U.S.C. 253l, and 41 U.S.C. 254(c), apply to the obligation rules for this contract award?

They alter the bona fide needs rules on severable service contracts covering the requirements of multiple fiscal years (more than 1 but not more than 5).



2c. Is the contract severable or entire?

It is severable due to the nature of the work and the SAF clause.

Nature of the work: The splitting of the work into distinctly different phases calling for different deliverables makes the contract severable.

SAF clause: The inclusion of this clause establishes the government’s option to sever the contract at specific intervals should they no longer want the information or can no longer afford the deliverable. This too, renders the contract severable.

2d. Was the initial obligation on this contract legal? Under what law? Explain.

Yes. Under the 12-month authority:

The first three phases may be obligated with FY 08 funds using 41 U.S.C. 252L as the authority.

Phase 4 is subject to the availability of funds and subject to government acceptance of Phases 1–3.

Thus, Phase 4 will be obligated using FY 09 or FY 10 funds depending on the notice to proceed.

2e. Explain how an alternative solution is possible under 41 U.S.C. 254(c).

41 U.S.C. 254(c) permits obligating requirements of more than one, but not more than 5 years to be funded up-front, incrementally or as the services are performed. Thus, with proper certifications, the entire amount of the contract may be obligated in FY 08.



Specific Issues: Issues—Part BA contractor has reported employee problems due to the National Guard activations and the related loss of productivity by skilled workers. Further he is facing financial problems associated with a recession-like national economy. He has asked for an advance payment to help him get back on schedule. Answer the following questions to determine the proper course of action.

With respect to advance payments in general (Tab 3 B):

1a. What determinations must be made by the agency head before an advance payment can be made?

In the interests of the government; security such as a lien; Fast Pay procedures

1b. May an advance be approved for this contractor?

No. None of the rules apply.

Specifically, in an alternative scenario:

2a. If the work was being done by another federal agency, would the answer change?

Advance payments are authorized for intra-governmental work (Economy Act).

2b. If the work was being done by state or local governments, would your answer (1b) be different? Why?

Perhaps. The prohibitions on advance payments do not apply to exclusive materials or services from state and local governments. The exception does not apply to products or services commercially available from other sources.



Specific Issues: Issues—Part CA contract obligating FY 08 funds was terminated in FY 09 for default. A replacement contract has been prepared. The new contract has the expired FY 08 funds on it. As the certifying officer you are responsible for determining the proper appropriation to use on the replacement contract. Answer the following questions to determine the proper course of action.

With respect to the matter of reobligating prior year appropriations resulting from a default or convenience termination (Tab 3 C):

1a. Does it matter whether the termination is for default or convenience? Explain.

Yes. Defaulted contracts preserve the availability of prior year funds for reobligation in a subsequent fiscal year. Convenience terminations do not automatically preserve the prior year funds.

1b. If the terms of the replacement contract will result in a higher cost than the amount originally deobligated, what appropriation is responsible for the additional amount?

The prior year expired funds remain available to fund entire replacement contract. Current year funds may be used to fund the replacdment contract if prior year funds are insufficient.

1c. What appropriation should be used to fund this replacement contract?

The appropriation funding the original contact award (FY 08 in this instance) may be used to fund the replacement contract, including the increased price.



Specific Issues: Issues—Part DA replacement contract is pending award awaiting your signature. The original contractor was unable to complete the work. The replacement contract adds two new requirements. The certifying officer is unsure which appropriation to use for the modifications. Answer the following questions to determine the proper course of action.

With respect to the modification providing $800,000 to enable the contractor to manually convert the incoming data (Tab 3 D):

1a. Which appropriation should be used to fund the modification?

The appropriation funding the original contract award (FY 08 in this instance) must be used to fund the increased price.

1b. Why?

The modification is necessary due to an antecedent liability.

With respect to the scope change requirement of $675,000 for the Canadian and Mexican data:

2a. Was this requirement a scope change? Explain.

The Mexican and Canadian deliverables were contemplated in the original solicitation. But, they were not funded in the original award.

A bona fide need was established for the services in FY 08.

2b. What appropriation ordinarily funds a scope change?

Normally, the appropriation in effect when the change is effective.

2c. May the replacement contract be awarded for a different scope than the original terminated contract?

Yes.

2d. If so, what appropriation must bear the costs (if any) of an increased scope?

Normally the increased scope requirements must be funded using the appropriation in effect on the date the contract modification is effective.



2e. If the contract was issued under 41 U.S.C. 253l, would your answer (2d.) be different?

The law permits charging costs of increased requirements under a severable service contract that crosses fiscal year lines to the appropriation charged with the costs of the contract. If that appropriation is the first fiscal year, then that appropriation should be used.

2f. Which appropriation should be chargeable for the Canadian and Mexican data?

FY 08 should be used. However, alternatively, the FY 09 appropriation may be used.


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