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.