1. FISCAL LAW “Show where Congress says you can,
not where Congress says you can’t”
Supreme Court Ruling on Budget Authority

2. Terminal Learning Objective
Action:
Conditions:
Standard:
Identify the Principles of Fiscal Law.
FM Leaders in a classroom environment working individually and as a member of a small group, using doctrinal and administrative publications, self-study exercises, personal experiences, practical exercises, handouts, and discussion
Verify the types of appropriations, purpose, time, and amount rules; Define funding threshold levels; Define Bona Fide Need Rule; Identify budget problems regarding fiscal law; and Verify the anti-deficiency act.

3. Overview (1 of 2)
Congress has the power of the purse. “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law” (U.S. Constitution, Art 1, Section 9, CL 7)
Budget/Contract Authority - Legal authority to enter into obligations which will result in immediate or future outlays of government funds (2 USC & 622 (2))
Appropriation Act is an authorization to incur obligations and make payments out of the Treasury for specified purposes

4. Overview (2 of 2) Authorization Act defines reasons for use of funds
Treasury Warrant provides fiscal resources to OMB
OMB formally subdivides funding to agencies through apportionment, allotment, or allocation
Funding Authorization Document provides activities authority to legally obligate government funds

5. Types of Appropriations
Operation and Maintenance (O&M) Annual - Day to day operations
Military Personnel (MILPAY) Annual - Soldier pay and entitlements
Procurement – 2031 thru years - Purchase of various high value items such as weapons, ammunition, missiles, etc
Military Construction Army (MILCON) years - New or continuing construction
Research, Development, Test & Evaluation (RDT&E) years - Future system’s RDT&E

6. Appropriations Law Key Principles
Three tests as to the lawful availability of funds (PTA)
Purpose (31 USC 1301)
Time (31 USC 1502)
Amount (31 USC
1342/1517)

7. Appropriated Funds Limitations
Proper purpose of expenditure
Within appropriation life (time limit)
Within amount established by Congress

8. Appropriations Law Key Principles
Appropriations shall be applied only to the objects for which the appropriations were made except as otherwise provided by law (31 U.S.C. 1301(a))

9. Purpose Statute (2 of 2)
Appropriation provides the dollars
Authorization and Legal History clarify the appropriation
Three Part Test - Used to validate Purpose Statute
Expenditure must be for the specific purpose or necessary and incident to proper execution of general purpose of appropriation
Must not be prohibited by law
Can not be provided for within the scope of another appropriation

10. Unexpired, Expired or Closed
Time Statute
Unexpired, Expired or Closed
Congress sets time limits by appropriation
President starts clock when he signs appropriation act
Obligation must occur within the appropriate period
Fiscal year of the appropriation designated by 1 Oct XX to 30 Sep XX
Adjustments to appropriation can be made up to 5 years after appropriation moves to expired stage

11. Amount Statue Items <$250,000 (O&M)
Items >$250,000 (Procurement)
Minor construction projects < $1,000,000 (O&M)
Maintenance and repair >$1,000,000 (O&M)
Projects >$1,500,000 (MILCON)

12. Bona Fide Need Rule
“only for payments or expenses properly incurred during the period of availability, or to complete contracts properly made during the period of availability”
Focus on timing of the obligation and current need of the agency
Spend current year dollars for current year needs
Supplies must be needs of period or consumed in period
- Exceptions are Inventory Stockage level, Delivery or Lead time

13. Common Problems Clothing
Generally considered a personal expense
Exceptions:
If not an ordinary purchase (cold weather gear)
Essential to successful completion of work
- Tuxedoes for Secret Service
- Suits for SOF on mission
Need for hazardous duty
- Safety shoes
Used as a Award/Reward
- T shirts/Hats for sports event winner (< 5% of participants)

14. Common Problems Food (1 of 3)
May not use appropriated funds for meals for government workers at duty station
Generally a personal expense - Paid salary - buy own food
Exceptions:
Light refreshments at government sponsored conferences for those attendees in a travel status and/or facility rental includes cost of food
gao-ada pdf
Award Ceremonies can have “light refreshments”
- Not for a Military Personnel Award Ceremony

15. Common Problems Food (2 of 3)
Exceptions cond’t:
Training when necessary to achieve training objective
- not for convenience
Ethnic or cultural awareness training
Civilian award/reward meal ($20 limit)
Bottled water may be procured when a building’s water supply is deemed unwholesome or unpotable
ADA bottle water pdf

16. Common Problems Food (3 of 3)
Meals expenses allowed (Civilian’s Only):
Meals are incidental to the meeting
Employee attendance at the meal is necessary for full participation in meeting
Can’t take meals elsewhere and achieve full participation
Not a routine business meeting

17. Common Problems General (1 of 2)
Decorations - When consistent with the work related objectives, placed in common area, and not for personal use, i.e., X-mas cards are a no go
Business Cards - Only allowed for those that regularly deal with public or outside organizations, i.e., recruiters, contractors, investigators
Entertainment - For equal opportunity/ethnic programs
Unit T-shirts - Not allowed
Mementos - Not allowed
Cell phones - Can reimburse for official phone call charges

18. Common Problems General (2 of 2)
Fines and Penalties - Can reimburse for fines directly associated with official duties, i.e., contempt fine by court not testifying due to regulations/agency instructions
- Parking tickets not covered
Licenses and Certificates - Can pay if duties directly benefit the government or State or local law requires position to have it
CDFM: interpretation of U.S.C. 5757, 1112 does allow for test reimbursement for civilians
Awards/Rewards - May be given
Unit Coins - Can buy coins for awards issued to individual on a one time basis for significant accomplishment or competition

19. Unauthorized Commitment
Common Problems
Unauthorized Commitment
Only an authorized individual with a warrant can procure for the government
If any unauthorized person enters into an agreement to purchase goods or services for the government and the government accepts the goods or services, the agreement must be ratified for payment to occur
Ratification is the act
of making the agreement
good
- Must be performed by
a Contracting Officer after
a legal review

20. Antideficiency Act
Prohibits government employees from:
- Making or authorizing expenditures or obligations:
- In excess of amount available in appropriation, apportionment, or allotment
- In advance of an appropriation, apportionment or allotment in violation of the Bona Fide Needs rule
- Accepting voluntary services
wrong appropriation gao-ada pdf
- Using military vehicles for personal use
I.E. - TMP vehicles used for domicile to duty transportation

21. Antideficiency Act Close Calls
Officials may avoid ADA violations if:
- Proper funds were available at the time of the erroneous obligation, i.e., OMA obligated for a MILCON project and where MILCON funds were available
- Proper funds were available continuously from the time of the erroneous obligation; and
- Proper funds were available for the agency to correct the erroneous obligation, i.e., ACOM or HQDA can cover it

22. Resources Fiscal Law Course - one week in Charlottesville, VA
Satellite VTC - timeframe varies
Web Site -
Fiscal Law Deskbook download on web

23. Check On Learning
Q. Whenever you are unsure about an appropriation or a budget issue, what three key rules to apply?
Q. How long is RDTE in the “unexpired” state?
True / False. According to the Bona Fide Needs Rule we can fund supplies needed this year with prior year dollars
Q. Explain the unexpired state; expired state; and unexpired state for funding
Q. What does the ACOM need to do before the installation (subordinate unit) can obligate money?
Purpose, Time, and Amount
2 Years
False
The ACOM needs to allot money to the installation. They must provide allotment 23

24. Terminal Learning Objective
Action:
Conditions:
Standard:
Identify the Principles of Fiscal Law.
FM Leaders in a classroom environment working individually and as a member of a small group, using doctrinal and administrative publications, self-study exercises, personal experiences, practical exercises, handouts, and discussion
Verify the types of appropriations, purpose, time, and amount rules; Define funding threshold levels; Define Bona Fide Need Rule; Identify budget problems regarding fiscal law; and Verify the anti-deficiency act.