B-122358, MARCH 21, 1955, 34 COMP. GEN. 459

B-122358, MARCH 21, 1955, 34 COMP. GEN. 459

APPROPRIATIONS - OBLIGATIONS - SECTION 1311, SUPPLEMENTAL APPROPRIATION ACT, 1955: THE RULES ESTABLISHED BY PRIOR DECISIONS OF THE COMPTROLLER GENERAL FOR DETERMINING WHEN AN OBLIGATION IS INCURRED FOR VARIOUS TYPES OF TRAVEL AND RELATED EXPENSES, PARTICULARLY AS TO WHICH FISCAL-YEAR APPROPRIATION IS CHARGEABLE, ARE NOT AFFECTED BY THE ENACTMENT OF SECTION 1311 (A) OF THE SUPPLEMENTAL APPROPRIATION ACT, 1955. THE PRACTICE OF THE CIVIL AERONAUTICS ADMINISTRATION OF OBLIGATING AN APPROPRIATION WITH THE ANTICIPATED COSTS OF TRAVEL AND RELATED SERVICES INCIDENT TO THE TRANSFER OF EMPLOYEES BETWEEN FIELD OFFICES ON THE BASIS OF TELETYPE AND TELEGRAPH MESSAGES DOES NOT MEET THE DOCUMENTARY REQUIREMENTS OF SECTION 1311, SUPPLEMENTAL APPROPRIATION ACT, 1955, FOR RECORDING OBLIGATIONS OF THE GOVERNMENT. WORK ORDERS PREPARED BY THE CIVIL AERONAUTICS ADMINISTRATION AND USED AS REQUISITIONS FOR WORK OR SERVICES TO BE PERFORMED BY NON GOVERNMENTAL CONCERNS MAY BE RECORDED AS OBLIGATIONS PURSUANT TO SECTION 1311 (A) OF THE SUPPLEMENTAL APPROPRIATION ACT, 1955, ONLY WHERE THEY CONSTITUTE BINDING AGREEMENTS FOR SPECIFIC WORK OR SERVICES. AIRCRAFT RENTAL CONTRACTS, WHICH DO NOT CONTAIN A GUARANTEED MINIMUM MONTHLY RATE BUT ARE DEPENDENT UPON USE OF THE AIRCRAFT, AND OPEN-END MATERIAL AND LABOR CONTRACTS, WHICH PROVIDE THAT ACTUAL CHARGES ARE DETERMINED ON BASIS OF ISSUANCE OF FINAL WORK OR PURCHASE ORDERS, ARE NOT BINDING AGREEMENTS FOR SPECIFIC GOODS OR SERVICES AS REQUIRED BY SECTION 1311 (A) (1) OF THE SUPPLEMENTAL APPROPRIATION ACT, 1955, AND ESTIMATED AMOUNTS UNDER SUCH CONTRACTS MAY NOT BE RECORDED AS OBLIGATIONS. PUBLIC UTILITIES CONTRACTS WHICH INCLUDE MINIMUM RATES AND PROVIDE FOR CHARGES BASED UPON CONSUMPTION ARE BINDING AGREEMENTS FOR SERVICES TO BE PERFORMED WITHIN THE MEANING OF SECTION 1311 (A) (1), SUPPLEMENTAL APPROPRIATION ACT, 1955, WHICH PROVIDES FOR RECORDING OF OBLIGATIONS OF THE GOVERNMENT, SO THAT MONTHLY ESTIMATES OF COST OF SERVICES TO BE PERFORMED MAY BE RECORDED AS OBLIGATIONS UNDER SUCH SECTION; HOWEVER, IN THE ABSENCE OF BINDING CONTRACTS, OBLIGATIONS MAY BE RECORDED ONLY ON THE BASIS OF UTILITY SERVICES ACTUALLY PERFORMED. IN VIEW OF THE PROVISIONS OF SECTION 1311, SUPPLEMENTAL APPROPRIATION ACT, 1955, WHICH PROVIDES THAT NO AMOUNT SHALL BE RECORDED AS AN OBLIGATION OF THE GOVERNMENT UNLESS IT IS SUPPORTED BY DOCUMENTARY EVIDENCE, MISCELLANEOUS EXPENSES OF THE CIVIL AERONAUTICS ADMINISTRATION FOR WHICH NO DOCUMENTARY EVIDENCE IS AVAILABLE UNTIL INVOICES ARE RECEIVED FOR PAYMENT MAY NOT BE RECORDED AS OBLIGATIONS OF THE GOVERNMENT ON THE BASIS OF ESTIMATES ON ANTICIPATED EXPENDITURES. WHERE THERE IS A WRITTEN BINDING AGREEMENT BETWEEN THE CIVIL AERONAUTICS ADMINISTRATION AND THE DEPARTMENT OF STATE FOR JOINT ADMINISTRATIVE EXPENSES AND OVERHEAD OF INTERNATIONAL FIELD OFFICES, THE ESTIMATED PRO RATA MONTHLY CHARGES FOR SUCH EXPENSES ARE RECORDABLE AS OBLIGATIONS UNDER SECTION 1311 (A) (1), SUPPLEMENTAL APPROPRIATION ACT, 1955. ESTIMATED AMOUNTS REPRESENTING PRO RATA MONTHLY SHARES OF JOINT ADMINISTRATIVE EXPENSES BY DEPARTMENT OF STATE FOR ADMINISTRATIVE OVERHEAD OF INTERNATIONAL FIELD OFFICES, PRO RATA MONTHLY CHARGES FOR RENT AND SERVICES BY DOMESTIC FIELD OFFICES FOR BUILDINGS AND SERVICES FURNISHED INTERNATIONAL PERSONNEL AND CHARGES FOR AIRCRAFT MAINTENANCE UNDER ANNUAL CONTRACTS AT FOREIGN LOCATIONS MAY BE RECORDED AS OBLIGATIONS UNDER SECTION 1311 (A) (1) OF THE SUPPLEMENTAL APPROPRIATION ACT, 1955, PROVIDED THERE ARE BINDING AGREEMENTS IN WRITING FOR THE SPECIFIC WORK OR SERVICES. ESTIMATED COSTS OF PETTY PURCHASES, PURCHASES OF GASOLINE AND OIL, SUPPLIES, COMMERCIAL TELEGRAMS AND LONG-DISTANCE TOLL CALLS RECEIVED MONTHLY FROM VARIOUS INTERNATIONAL FIELD OFFICES MAY NOT BE RECORDED AS OBLIGATIONS PURSUANT TO SECTION 1311 (A) OF THE SUPPLEMENTAL APPROPRIATION ACT, 1955.

ASSISTANT COMPTROLLER GENERAL WEITZEL TO THE SECRETARY OF COMMERCE, MARCH 21, 1955:

REFERENCE IS MADE TO LETTER OF DECEMBER 14, 1954, FROM THE ACTING SECRETARY OF COMMERCE, TRANSMITTING A MEMORANDUM OF THE CIVIL AERONAUTICS ADMINISTRATION WHICH SETS FORTH TRANSACTIONS THAT IN THE PAST HAVE BEEN RECORDED AS OBLIGATIONS ON THE BASIS OF INFORMAL DOCUMENTATION SUCH AS TELETYPE OR TELEGRAPH MESSAGES, WORK ORDERS, OR INTEROFFICE MEMORANDUMS OR OTHER DOCUMENTS CONTAINING ESTIMATES OF OBLIGATIONS BASED ON PRIOR YEARS' EXPENDITURES OR OTHER EXPERIENCE. A DECISION IS REQUESTED BY THE ACTING SECRETARY ON THE APPLICATION AND EFFECT OF SECTION 1311 (A) OF THE SUPPLEMENTAL APPROPRIATION ACT, 1955, PUBLIC LAW 663, APPROVED AUGUST 26, 1954, 68 STAT. 800, 830; IN ADDITION WE ARE ASKED TO FORMULATE, IF POSSIBLE, A GENERAL RULE FOR THE GUIDANCE OF YOUR DEPARTMENT IN COMPLYING WITH SECTION 1311 (A).

WHILE GUIDANCE MAY BE GIVEN YOUR DEPARTMENT AS TO THE GENERAL APPROACH IN COMPLYING WITH SECTION 1311 (A), THE FORMULATION OF A GENERAL RULE IS NOT FEASIBLE SINCE, IN THE FINAL ANALYSIS, THE VALIDITY OF OBLIGATIONS AND EXPENDITURES WILL HAVE TO BE DETERMINED UPON THE BASIS OF THE LAW AND FACTS IN EACH INDIVIDUAL CASE.

SECTION 1311 (A), 68 STAT. 830, PROVIDES AS FOLLOWS:

SEC. 1311. (A) AFTER THE DATE OF ENACTMENT HEREOF NO AMOUNT SHALL BE RECORDED AS AN OBLIGATION OF THE GOVERNMENT OF THE UNITED STATES UNLESS IT IS SUPPORTED BY DOCUMENTARY EVIDENCE OF---

(1) A BINDING AGREEMENT IN WRITING BETWEEN THE PARTIES THERETO, INCLUDING GOVERNMENT AGENCIES, IN A MANNER AND FORM AND FOR A PURPOSE AUTHORIZED BY LAW, EXECUTED BEFORE THE EXPIRATION OF THE PERIOD OF AVAILABILITY FOR OBLIGATION OF THE APPROPRIATION OR FUND CONCERNED FOR SPECIFIC GOODS TO BE DELIVERED, REAL PROPERTY TO BE PURCHASED OR LEASED, OR WORK OR SERVICES TO BE PERFORMED; OR

(2) A VALID LOAN AGREEMENT, SHOWING THE AMOUNT OF THE LOAN TO BE MADE AND THE TERMS OF REPAYMENT THEREOF; OR

(3) AN ORDER REQUIRED BY LAW TO BE PLACED WITH A GOVERNMENT AGENCY; OR

(4) AN ORDER ISSUED PURSUANT TO A LAW AUTHORIZING PURCHASES WITHOUT ADVERTISING WHEN NECESSITATED BY PUBLIC EXIGENCY OR FOR PERISHABLE SUBSISTENCE SUPPLIES OR WITHIN SPECIFIC MONETARY LIMITATIONS; OR

(5) A GRANT OR SUBSIDY PAYABLE (I) FROM APPROPRIATIONS MADE FOR PAYMENT OF OR CONTRIBUTIONS TOWARD, SUMS REQUIRED TO BE PAID IN SPECIFIC AMOUNTS FIXED BY LAW OR IN ACCORD WITH FORMULAE PRESCRIBED BY LAW, OR (II) PURSUANT TO AGREEMENT AUTHORIZED BY, OR PLANS APPROVED IN ACCORD WITH AND AUTHORIZED BY, LAW; OR

(6) A LIABILITY WHICH MAY RESULT FROM PENDING LITIGATION BROUGHT UNDER AUTHORITY OF LAW; OR

(7) EMPLOYMENT OR SERVICES OF PERSONS OR EXPENSES OF TRAVEL IN ACCORD WITH LAW, AND SERVICES PERFORMED BY PUBLIC UTILITIES; OR

(8) ANY OTHER LEGAL LIABILITY OF THE UNITED STATES AGAINST AN APPROPRIATION OR FUND LEGALLY AVAILABLE THEREFOR.

THE SPECIFIC CLASSES OF TRANSACTIONS DESCRIBED IN THE MEMORANDUM OF THE CIVIL AERONAUTICS ADMINISTRATION WILL BE QUOTED AND ANSWERED IN THE ORDER PRESENTED.

1. TRAVEL AND TRANSPORTATION EXPENSES. MESSAGES HAVE BEEN EMPLOYED FOR THE OBLIGATION OF ANTICIPATED COSTS INCIDENT TO THE TRANSFER BETWEEN REGIONS OF EMPLOYEES, THEIR DEPENDENTS AND HOUSEHOLD EFFECTS. IN THESE CASES REIMBURSEMENTS WILL BE MADE ON A COMMUTED BASIS AND THE OBLIGATIONS ARE RECORDED FROM THE MESSAGES UNDER THE CONCEPT STATED IN SECTION 22 OF BUDGET-TREASURY REGULATION NO. 1, PROVIDING FOR THE INCLUSION OF "THE ANTICIPATED AMOUNT TO BE PAID UNDER ORDERS ACTUALLY ISSUED TO THE EMPLOYEE.' THE REGION RELEASING THE EMPLOYEE GENERALLY HAS THE TRAVEL ORDER PREPARED BUT HAS NOT ACTUALLY ISSUED IT TO THE EMPLOYEE WHEN THE MESSAGE REQUEST FOR OBLIGATION IS SENT TO THE RECEIVING REGION WHICH IS REQUIRED TO BEAR THE EXPENSES OF THE TRANSFER. WITH RESPECT TO OTHER TRANSPORTATION EXPENSES, EMPLOYEES STATIONED OUTSIDE OF REGIONAL HEADQUARTERS ISSUE BILLS OF LADING FOR THE IMMEDIATE SHIPMENT OF CAA PROPERTY. IN ORDER THAT THESE SHIPMENTS WILL NOT BE DELAYED, THE EMPLOYEES REQUEST THE ACCOUNTING OFFICE BY MESSAGE TO OBLIGATE THE NECESSARY FUNDS AND TO ADVISE BY RETURN MESSAGE THE OBLIGATION NUMBER GIVEN TO THE TRANSACTION. OBLIGATIONS HAVE BEEN ESTABLISHED ON THE BASIS OF THESE MESSAGES FOR THE REASON THAT THEY SERVE AS ADVICES THAT U.S. GOVERNMENT BILLS OF LADING WILL BE ISSUED TO SUPPORT THE RELATED TRANSACTIONS. THE ACTUAL DOCUMENTARY EVIDENCE, SUCH AS COPIES OF BILLS OF LADING AND TRAVEL ORDERS, TO SUPPORT THE AMOUNTS OBLIGATED UPON THE RECEIPT OF MESSAGES UNDER THE ABOVE-DESCRIBED CIRCUMSTANCES ARE RECEIVED IN THE ACCOUNTING OFFICES AFTER THE AMOUNTS HAVE BEEN RECORDED AS OBLIGATIONS.

THE RULES ESTABLISHED BY PRIOR DECISIONS OF THIS OFFICE FOR DETERMINING WHEN AN OBLIGATION IS INCURRED FOR THE VARIOUS TYPES OF TRAVEL AND RELATED EXPENSES, PARTICULARLY AS TO WHICH FISCAL-YEAR APPROPRIATION IS CHARGEABLE, VARY IN ACCORDANCE WITH THE LAW AND FACTS INVOLVED IN EACH TYPE OF EXPENSE. THERE IS NO DOUBT THAT THE CONGRESS IN ENACTING SECTION 1311, HAD NO SPECIFIC INTENT TO RELAX ANY OF THESE RULES. SINCE THE ACTIONS UPON WHICH THE MESSAGES ARE BASED ARE NOT RECOGNIZED BY THE DECISIONS OF THIS OFFICE AS SUFFICIENT TO INCUR AN OBLIGATION, THE MESSAGES MAY NOT BE CONSIDERED AS MEETING THE DOCUMENTARY EVIDENCE REQUIREMENTS OF SECTION 1311 (A). THE CONCEPT OF OBLIGATIONS IN SECTION 22 OF THE BUDGET-TREASURY REGULATION NO. 1 REFERRED TO ABOVE BY THE CIVIL AERONAUTICS ADMINISTRATION IS APPLICABLE ONLY IN THE CASE OF REIMBURSEMENTS TO AN EMPLOYEE (UPON A COMMUTED BASIS) FOR TRANSPORTATION OF HIS HOUSEHOLD EFFECTS. EVEN IN THAT CASE, THE ORDERS ARE REQUIRED TO HAVE BEEN ACTUALLY ISSUED.

2. WORK ORDERS. WORK ORDERS ARE PREPARED AS REQUISITIONS FOR VARIOUS TYPES OF SERVICES. IN THE CASE OF REQUESTS FOR INTERPHONE AND TELETYPE SERVICES, THE WORK ORDERS REFLECT ANTICIPATED COSTS OF NON RECURRING SERVICE CHARGES AND THE RECURRING MONTHLY RATES. THE AMOUNTS OF THE NON- RECURRING SERVICE CHARGES ARE RECORDED AS OBLIGATIONS UPON RECEIPT OF THE WORK ORDERS, THE AMOUNTS OF RECURRING MONTHLY RATES AS TREATED AS ADMINISTRATIVE RESERVATIONS. RECURRING MONTHLY RATES ARE LATER RECORDED AS OBLIGATIONS UPON RECEIPT OF THE ORIGINAL EXECUTED INTERPHONE OR TELETYPE CONTRACT.

THESE ARE UNDERSTOOD TO BE EXTERNAL REQUISITIONS OR PURCHASE ORDERS. OBLIGATIONS MAY BE RECORDED ON THE BASIS OF SUCH "WORK ORDERS" ONLY WHERE THEY CONSTITUTE BINDING AGREEMENTS FOR SPECIFIC WORK OR SERVICES.

3. ESTIMATED DOMESTIC OBLIGATIONS. ESTIMATED OBLIGATIONS HAVE BEEN RECORDED IN THE PAST FOR CERTAIN TYPES OF TRANSACTIONS ON THE BASIS OF INFORMATION FURNISHED BY BUDGET OFFICERS OR OTHER OFFICERS WITH THE CAA. THESE OBLIGATIONS GENERALLY RELATE TO TRANSACTIONS FOR WHICH DOCUMENTARY EVIDENCE IS NOT AVAILABLE UNTIL INVOICES ARE RECEIVED FOR PAYMENT. FACT, THE PRECISE COSTS ARE OFTEN NOT KNOWN BY THE ACCOUNTING OFFICES IN THESE CASES UNTIL VOUCHERS ARE RECEIVED SOME TIME AFTER THE TRANSACTION, AT WHICH TIME THE CAA MIGHT OTHERWISE BE LIABLE FOR AN OBLIGATION IN EXCESS OF THE AVAILABLE BALANCE IN THE ALLOTMENT OR APPORTIONMENT ACCOUNT. FURTHER, IF ANY FUNDS ARE NOT OBLIGATED WITHIN A PRESCRIBED QUARTER, THE POSSIBILITY EXISTS OF IMPOUNDMENT BY THE BUREAU OF THE BUDGET. RECORDATION OF THESE OBLIGATIONS HAS GENERALLY OCCURRED IN THE FOLLOWING TYPES OF TRANSACTIONS.

(A) MONTHLY TRAVEL UNDER ANNUAL TRAVEL ORDERS. ESTIMATES ARE COMPUTED ON A GROUP OR ORGANIZATIONAL BASIS AS CONTEMPLATED BY THE AUTHORIZED FISCAL WORK PROGRAM.

(B) RENTAL OF AIRCRAFT. MONTHLY ESTIMATES ARE COMPUTED WHEN THE CONTRACT DOES NOT CONTAIN A GUARANTEE OF A MINIMUM MONTHLY RATE OR WHEN IT IS ANTICIPATED THAT AIRCRAFT WILL BE RENTED FOR PERIODS IN EXCESS OF THAT COVERED BY THE MINIMUM MONTHLY RATE.

(C) OPEN-END MATERIAL AND LABOR CONTRACT. OBLIGATIONS ARE RECORDED ON THE BASIS OF ESTIMATES WHERE THE HOURLY LABOR RATES AND MATERIAL COSTS ARE CONTAINED IN THE BASIC CONTRACTS BUT THE ACTUAL CHARGES ARE DETERMINED AS A RESULT OF THE ISSUANCE OF FINAL ORDERS, EITHER WORK ORDERS OR PURCHASE ORDERS.

(D) PUBLIC UTILITIES. MONTHLY ESTIMATES ARE MADE ON THE BASIS OF PAST EXPERIENCE FOR PUBLIC UTILITIES CONTRACTS WHICH INCLUDE MINIMUM RATES BUT PROVIDE FOR CHARGES BASED UPON CONSUMPTION.

(E) MOBILE EQUIPMENT COSTS. ESTIMATES ARE COMPUTED FOR GASOLINE AND OIL FOR AIRCRAFT, PASSENGER-CARRYING VEHICLES, TRUCKS AND OFF-ROAD VEHICLES, STORAGE AND REPAIRS TO MOBILE EQUIPMENT, AND SERVICE STATION CREDIT CARD PURCHASES. THESE ESTIMATES ARE DESIRABLE BECAUSE OF THE LARGE VOLUME, THE SMALL AMOUNTS INVOLVED, AND THE EXTENSIVE DISTRIBUTION OF AMOUNTS TO THE DIFFERENT OBJECT CLASSES OF EXPENDITURES.

(F) MISCELLANY. ESTIMATES ARE PROVIDED FOR SUCH SMALL ITEMS AS POSTAGE EXPENSES, WITNESS FEES, AND MILEAGE.

THE COMMENTS UNDER "1.' ABOVE ARE APPLICABLE TO 3 (A).

THE DESCRIPTIONS OF ITEM 3 (B) AND (C) INDICATE THAT NO SPECIFIC OBLIGATIONS ARE ASSUMED BY THE GOVERNMENT UNDER THE CONTRACTS, BUT THAT OBLIGATIONS ARE DEPENDENT UPON THE USE OF AIRCRAFT, OR THE ISSUANCE OF FINAL WORK ORDERS OR PURCHASE ORDERS FOR LABOR OR MATERIALS. SINCE THERE IS NO BINDING AGREEMENT FOR SPECIFIC GOODS TO BE DELIVERED OR WORK OR SERVICES TO BE PERFORMED AS REQUIRED BY SECTION 1311 (A) (1), 68 STAT. 830, THE ESTIMATED AMOUNTS ARE NOT RECORDABLE AS OBLIGATIONS.

CONCERNING 3 (D), MONTHLY ESTIMATES OF THE COST OF SERVICES TO BE PERFORMED UNDER BINDING AGREEMENTS MAY BE RECORDED AS OBLIGATIONS. IN THE ABSENCE OF BINDING AGREEMENTS, OBLIGATIONS MAY BE RECORDED ON THE BASIS OF ONLY UTILITY SERVICES ACTUALLY PERFORMED.

SINCE THE ITEMS DESCRIBED IN 3 (E) AND (F) ARE BUT ESTIMATES OF ANTICIPATED EXPENSES, THEY ARE NOT RECORDABLE AS OBLIGATIONS UNDER SECTION 1311 (A).

4. ESTIMATED FOREIGN OBLIGATIONS. TYPES OF FOREIGN AND OTHER TRANSACTIONS OF OUR INTERNATIONAL REGION WHICH INVOLVE ESTIMATED AMOUNTS FOR OBLIGATION INCLUDE THE FOLLOWING:

(A) PRO RATA MONTHLY CHARGES OF JOINT ADMINISTRATIVE EXPENSES BY THE DEPARTMENT OF STATE FOR ADMINISTRATIVE OVERHEAD OF INTERNATIONAL FIELD OFFICES. COMPUTATIONS TO DETERMINE THESE CHARGES ARE GENERALLY MADE ONCE EACH FISCAL YEAR BY THE DEPARTMENT OF STATE WHICH SUBMITS ITS BILLING TO THE CAA NEAR THE CLOSE OF THE FISCAL YEAR.

(B) PRO RATA MONTHLY SHARE OF RENT AND SERVICE AGREEMENT CHARGES FOR REIMBURSEMENT TO DOMESTIC CAA REGIONS WHICH ARE THE PRIME CONTRACTORS. REIMBURSEMENTS ARE MADE TO THE CONTRACTING REGIONS FOR RENTAL APPLICABLE TO THE AREA OF A BUILDING OCCUPIED BY INTERNATIONAL REGION PERSONNEL AND THE PORTION OF THE SERVICES WHICH APPLY TO THAT AREA.

(C) SERVICES PERFORMED UNDER ANNUAL CONTRACTS FOR AIRCRAFT MAINTENANCE AT FOREIGN LOCATIONS.

(D) ADVICES RECEIVED MONTHLY FROM VARIOUS INTERNATIONAL REGIONAL FIELD OFFICES TO ESTIMATE COSTS OF PETTY PURCHASES, PURCHASES OF GASOLINE AND OIL, SUPPLIES, COMMERCIAL TELEGRAMS AND CABLEGRAMS, AND LONG DISTANCE TOLL CALLS.

ASSUMING THE EXISTENCE OF BINDING AGREEMENTS IN WRITING FOR SPECIFIC WORK OR SERVICES UNDER THE FACTS AS STATED IN 4 (A), (B), AND (C), THE CHARGES WOULD BE RECORDABLE WITHIN SECTION 1311 (A) (1).

NO PROVISION IS MADE IN SECTION 1311 (A) FOR THE RECORDING OF ESTIMATED COSTS AS DESCRIBED IN 4 (D).