BNUMBER:  B-260606 
DATE:  July 25, 1997
TITLE: [Letter], B-260606, July 25, 1997
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B-260606

July 25, 1997

The Honorable Michael F. DiMario
Public Printer
U.S. Government Printing Office

Dear Mr. DiMario:

You have requested our opinion concerning the use of balances credited 
to the Government Printing Office's (GPO's) revolving fund established 
under 44 U.S.C.    sec.  309.  Specifically, you ask whether you may use 
balances in the fund that you refer to as "fiduciary" funds to meet 
the normal operating expenses of GPO.  The "fiduciary" funds consist 
of balances for such items as advances from customers, accrued 
salaries and leave, and estimated incentives and lump-sum leave 
payments for expected early retirements.  

In the past, GPO has experienced significant cash shortages in its 
revolving fund due to increasing costs, which it was unable to pass on 
to its customers.  These shortages threatened GPO's ability to fund 
its daily operating costs.  You advise that auditors informed you that 
money that GPO has traditionally restricted as "fiduciary" funds can 
be used to cover the costs of daily operations.  You are concerned 
that using "fiduciary" funds to pay for operating expenses may 
conflict with the holding in a 1992 Comptroller General decision, 71 
Comp. Gen. 224 (1992).  In that decision the Comptroller General 
concluded that the National Technical Information Service (NTIS) could 
not use funds advanced by customers except to cover expenses "directly 
related to services performed or to be performed" for those customers.  

GPO finances most of its operations out of its revolving fund.  The 
fund
     
     "is available, without fiscal year limitation, for--
         "the operation and maintenance of the Government Printing 
     Office (except for those programs of the Superintendent of 
     Documents which are funded by specific appropriations) . . . ."

44 U.S.C.  sec.  309(a).   The statute further states that:

     "The fund shall be---
          "(1) reimbursed for the cost of all services and supplies 
     furnished, including those furnished other appropriations of the 
     Government Printing Office . . . ; and
          "(2) credited with all receipts including sales of 
     Government publications, waste, condemned, and surplus property 
     and with payments received for losses or damage to property."

44 U.S.C.  sec.  309(b).  

The enabling statute further requires that Congress approve GPO's 
annual budget for expenditures from the revolving fund.  44 U.S.C.  sec.  
309(c).  Thus, the Legislative Branch Appropriations Act, 1997 
provides as follows:

     "The Government Printing Office is hereby authorized to make such 
     expenditures, within the limits of funds available and in accord 
     with the law . . . as may be necessary in carrying out the 
     programs and purposes set forth in the budget for the current 
     fiscal year for the 'Government Printing Office revolving fund . 
     . . '"

Pub. L. No. 104-197, 110 Stat. 2394 at 2410.  Since GPO's annual 
budget indicates that it finances almost all its operations through 
the revolving fund, the fund "is analogous to an agency's annual 
appropriation for salaries and expenses under which all necessary 
expenses of an agency can be paid."  B-216943, March 21, 1985.

By the terms of its enabling statute, the GPO revolving fund is 
available to meet the operating expenses of the GPO.  44 U.S.C.  sec.  
309(a).  The revolving fund is a single fund consisting of all income 
received by GPO for services and goods it provides to other agencies 
and for sales of publications.  Although GPO has administratively 
divided the fund into several accounts, it may move budgetary 
resources among these accounts to the extent they are not already 
obligated.

According to your submission, GPO restricts balances in the fund, 
reserving them for certain purposes.  One category of restricted cash 
is "Fiduciary Funds," which at the time of your submission consisted 
of Advances From Customers for Sales of Publications and Printing and 
Binding Work, Estimated Incentive Pay for Early Retirement, Estimated 
Lump Sum Annual Leave for Early Retirees, Accrued Salaries, Wages & 
Withholdings, and Accrued Annual Leave.  Your submission indicated 
that the advances from customers are of two types--deferred revenue, 
i.e.,  customer orders that have been placed but not yet filled, and 
depositor accounts, i.e., customer advances for orders that may be 
placed in the future.

In your letter you expressed concern that GPO's use of customer 
advances to cover operating expenses would be contrary to the holding 
of the Comptroller General in 71 Comp Gen. 224 (1992), and accordingly 
that this practice might violate the Antideficiency Act, 31 U.S.C.  sec.  
1341(a)(1).  In the cited decision the Comptroller General decided 
that the NTIS could not use funds advanced by customers except for 
expenses "directly related to services performed or to be performed."  
71 Comp. Gen. 224.  The decision in that case was based on the 
language of the statute that created the special account out of which 
NTIS operated.  That statute provided that:

     "payments for work or services performed or to be performed . . . 
     shall be deposited in a special account or accounts which may be 
     used to pay directly the costs of such work or services, to repay 
     or make advances to appropriations or funds which do or will 
     initially bear all or part of such costs, or to refund excess 
     funds when necessary . . . . "

15 U.S.C.  sec.  1526 (emphasis added).  We held that this language 
permitted NTIS to use customer advances that represented payment for 
subscriptions to meet the cost of the subscription.  However, advances 
to cover possible future subscriptions were not payments for services 
"performed or to be performed" and thus were not available to cover 
NTIS operations.

GPO's revolving fund statute differs significantly from the NTIS 
statute.  The GPO revolving fund is credited with receipts from many 
sources, not just with payments for work or services performed or to 
be performed.  Further, the GPO revolving fund is available for the 
operation and maintenance of GPO, not just to pay the direct costs of 
work or services performed.  

Nonetheless, the underlying rationale of the NTIS decision does apply 
to the amounts which customers have advanced to GPO in anticipation of 
orders to be placed in the future.  These amounts represent funds that 
GPO holds as a custodian for its customer.  They do not represent 
reimbursements "for the cost of all services and supplies furnished" 
(44 U.S.C.  sec.  309(b)(1)), and they are not "receipts" that may be 
credited to the revolving fund (44 U.S.C.  sec.  309(b)(2)) before they are 
earned.  GPO may not treat these advances as budget authority to 
support its operations until the customer places a proper order for 
goods or services to be provided by GPO.

Although OMB Circular A-34 is addressed to Executive departments and 
agencies, and technically does not apply to the GPO revolving fund, it 
does state the proper criterion for determining whether reimbursements 
to a revolving fund may be considered budgetary resources against 
which obligations may lawfully be charged.  Circular A-34 states:

     "In the case of reimbursable work involving goods and services 
     provided to Federal Government accounts, budgetary resources 
     available for obligation from reimbursements are comprised of 
     earned reimbursements and unfilled customer's orders.  An earned 
     reimbursement is the amount representing orders that have been 
     filled.  As with an earned reimbursement, an unfilled order is 
     available for obligation.  It is emphasized that there must be an 
     order and a valid obligation from the ordering account before 
     such reimbursable work creates budgetary resources available for 
     obligation.  For example, an advance from a Federal Government 
     account without an order does not constitute budgetary resources 
     available for obligation.  Throughout the year these amounts are 
     adjusted to the extent that orders are filled, cancelled, or new 
     orders are received."

OMB Circular A-34,  sec.  31.4, at page III-2 (1994)(emphasis added; bold 
and italic font in original omitted)[1].

With regard to the remaining amounts that are listed as fiduciary 
funds, the "Accrued Salaries, Wages and Withholdings" and the "Accrued 
Annual Leave" represent funds that have been obligated for the stated 
purposes.  They may not be obligated again to meet GPO's daily 
operating expenses.  On the other hand, the "Estimated Incentive Pay 
for Early Retirement" represent funds that have been set aside as a 
reserve for the possible payment of incentives to early retirees.  
Since the employees have not yet opted for early retirement they are 
not entitled to an incentive, and therefore the funds are not 
obligated. It follows that these funds are available to meet GPO's 
operating expenses.

We conclude that the "fiduciary" funds in the GPO revolving fund are 
available to meet daily operating expenses as follows:

Advances from Customers: Depositor AccountsThese are not yet 
                                          earned.Not Available

Advances from Customers: Deferred RevenueThese are reimbursements for 
                     orders placed.       Available

Estimated Incentive Pay for Early RetirementThese represent reserves 
                     but are not obligatedAvailableAccrued Salaries, 
Wages and WithholdingsThese funds are obligatedNot Available

Accrued Annual Leave These funds are obligatedNot Available
Sincerely yours, 

Robert P. Murphy
General Counsel

B-260606

July 25, 1997

DIGEST

Government Printing Office may use so-called "fiduciary" funds in its 
revolving fund to meet its daily operating costs to the extent it has 
earned those funds and has not already obligated them for another 
purpose.  Advances from goverment customers that represent orders 
placed but not yet filled have been "earned" and are thus available to 
support GPO operations.  However, advances from government customers 
that are in anticipation of orders to be placed in the future are not 
earned are not available to GPO.

1. OMB Circular A-34 has similar rules for handling reimbursements 
involving goods and services provided to the public except that the 
amount available for obligation is limited to the amount of advances 
actually received by the revolving fund.  Id.