BNUMBER: B-257488
DATE: November 6, 1995
TITLE: Food and Drug
Administration - Use of Appropriations for "No Red Tape"
Buttons and Mementoes
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Matter of:Food and Drug Administration - Use of Appropriations for "No
Red Tape" Buttons and Mementoes
File: B-257488
Date: November 6, 1995
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DIGEST
l. Food and Drug Administration may use its appropriations to
purchase "No Red Tape" buttons to promote the effectiveness and
efficiency of employees, thereby furthering an authorized agency
purpose.
2. Under the Government Employees' Incentive Awards Act, 5 U.S.C.
4501-4506, Food and Drug Administration appropriations are available
for the purchase of coffee mugs and pens for federal employees if
these items are intended to be presented as honorary or informal
recognition awards.
______________________________________________________________________
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DECISION
The Director, Division of Accounting, Food and Drug Administration
(FDA), Department of Health and Human Services, asks whether FDA
appropriations may be used to purchase "No Red Tape" buttons to remind
employees to carry out their functions efficiently, and for awards,
such as coffee mugs and pens, which would be presented to speakers and
federal employees at FDA District Conferences. For reasons discussed
below, FDA appropriations are available for these purchases.
BACKGROUND
The Office of Management Systems (OMS), Center for Food Safety and
Applied Nutrition, FDA, would like to purchase buttons inscribed with
the logo, "No Red Tape." As part of an office campaign to promote
team building, efficiency, and effectiveness, OMS would distribute
these buttons to its staff of 130 to voluntarily wear while at work.
OMS intends the buttons to serve as visible reminders to staff and
customers that OMS' mission is not to say "no" but to find ways to
work together to satisfy its customers' needs. FDA states that these
buttons are not personal gifts but, rather, are a management tool that
would provide a cost-effective way of displaying the OMS mission
statement. The buttons would cost less than $150.
In addition, FDA would like to purchase items, such as coffee mugs,
pens or other inexpensive mementoes, to award to participants and to
present to guest speakers at District Conferences. The mementoes,
emblazoned with the theme adopted for the conference, would serve as a
remembrance of a particular task, occasion, or a job well done. FDA
believes that these tokens, while inexpensive ($2 to $3 each), are
very important in encouraging a sense of teamwork and identity with
the organization, and in building employee morale.
FDA would charge the expenses in question to its Salaries and Expenses
appropriation, which is provided for the necessary expenses of the
agency. Pub. L. No. 104-31 (Sept. 30, 1995). The Senate report on
the fiscal year 1995 FDA appropriation stated that FDA's mission is to
ensure that (1) food is safe, pure, and wholesome; (2) cosmetics are
safe; (3) human and animal drugs, biological products, and therapeutic
devices are safe and effective; and (4) radiological products and use
procedures do not result in unnecessary exposure to radiation. S.
Rep. No. 290, 103d Cong., 2d. Sess. 132 (1994).
DISCUSSION
"No Red Tape" Buttons
We have been frequently asked about the purchase of relatively
inexpensive items for distribution to agency employees as incentives
to boost morale or increase support for a particular program. The
question, of course, is whether the agency is authorized to use its
appropriation for the particular expenditure. 31 U.S.C
1301(a). If the item in question is not specifically authorized by
any appropriation act or other statute, the standard for measuring the
propriety of the expenditure is the "necessary expense" rule. 66
Comp. Gen. 356, 359 (1987). Under this rule, an expenditure is
permissible if it is reasonably necessary to carry out an authorized
function or will contribute materially to the effective accomplishment
of that function, and is not otherwise prohibited by law. Id.
The application of the "necessary expense" rule is, in the first
instance, a matter of agency discretion. However that discretion is
not unfettered. For example, we rejected the use of appropriated
funds to pay for plastic ice scrapers imprinted with the inscription
"U.S. Army Corps of Engineers - Huntsville Division - Please don't
drink and drive" for Huntsville employees. B-223608, Dec. 19, 1988.
The Corps argued that the ice scrapers served a valuable promotional
purpose in support of the Huntsville division's safety program.
However, because the Corps did not demonstrate how, if at all, the ice
scrapers addressed an occupational health and safety hazard not shared
by the public as a whole, we did not view the expense as necessary to
the Corps' discharge of its functions. Id. Similarly, we did not
accept an IRS argument that the distribution of T-shirts stamped with
the Combined Federal Campaign (CFC) logo to IRS Memphis Service Center
employees contributing five or more dollars per pay period to CFC was
a necessary expense to motivate its employees to contribute to CFC.
70 Comp. Gen. 248 (1991). In each of these cases, we balanced our
respect for agency discretion against the clear potential for abuse of
taxpayers dollars if we were to accept the agency's rationale. See 1
GAO Principles of Federal Appropriations Law p. 4-128 (2d. ed. 1991).
Therefore, in determining the propriety of a proposed expenditure, we
will consider whether the relationship between an authorized function
and a proposed expenditure is so attenuated as to take it beyond the
agency's legitimate range of discretion. B-247563.2, May 12, 1993;
B-223608, Dec. 19, 1988.
Under a "necessary expense" analysis, where the item, such as the
buttons at issue here, has no intrinsic value to its recipient, and is
designed solely to assist in achieving internal agency management
objectives, the agency must show that the item will contribute to the
agency's mission. We think FDA has demonstrated the requisite nexus
between its appropriation's purpose and the "no red tape" buttons.
The message is clearly informational and directed at the promotion of
an internal agency management objective. The button serves much the
same purpose as other internal agency informational media such as
posters, memos, etc., reminding agency employees of institutional
objectives and goals. In these circumstances, the purchase of the
buttons can be considered a necessary expense that is incidental to
the purpose of the FDA appropriation. We, therefore, do not object to
the use of appropriations for this proposed purchase.
FDA District Conference Mementoes
FDA proposes to purchase inexpensive mementoes to award to federal
employees and to present to guest speakers at its District
Conferences. The Government Employees' Incentive Awards Act (Act), 5
U.S.C. 4501-4506, authorizes agency heads to "pay a cash award to,
and incur necessary expenses for the honorary recognition" of, federal
employees. 5 U.S.C. 4503. For example, the purchase of telephones
(nominal value of $27) to be presented as honorary awards is an
allowable use of appropriated funds under this Act. 67 Comp. Gen.
349, 350 (1988). See also B-184306, Aug. 27, 1980 (desk medallions
for use as paperweights).
The Act authorizes the Office of Personnel Management (OPM) to
prescribe regulations and instructions under which agency awards
programs will be carried out. 5 U.S.C. 4506. In August 1995, OPM
issued regulations defining an "award" as "something bestowed or an
action taken to recognize and reward individual or team achievement
that contributes to meeting organizational goals or improving the
efficiency, effectiveness, and economy of the government or is
otherwise in the public interest." 60 Fed. Reg. 43936 (to be codified
at 5 C.F.R. 451.102). Under these regulations, mugs and pens are
acceptable as awards so long as they are "bestowed . . . to recognize
and reward . . . achievement . . . ." Accordingly, if FDA proposes to
present the mugs and pens at issue here to employees in honorary
recognition of an achievement that otherwise meets the criteria set
forth in OPM regulations,[1] the proposed purchase may be deemed a
necessary expense that is chargeable to FDA appropriations. However,
FDA's appropriations are not available to purchase such items for
distribution to all conference attendees as a remembrance of the
event. The items, in such case, could not be characterized as
"honorary" in nature. See e.g., 53 Comp. Gen. 770 (1974), where
decorative ashtrays, which were distributed to conference attendees,
were deemed personal gifts and hence, not a necessary expense of the
agency's appropriations.
We do not object to presenting such mementoes to District Conference
guest speakers if the purpose of the speech is to further an
authorized agency purpose. See, e.g., B-208729, May 24, 1983, where
an honorarium paid to a guest speaker was deemed a necessary expense
of a program that advanced an agency objective.
/s/Robert Murphy
for Comptroller General
of the United States
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1. 60 Fed. Reg. 43946 (to be codified at 5 C.F.R. 451.104(a)).