TITLE:  National Park Service Soil Surveys, B-282601, September 27, 1999
BNUMBER:  B-282601
DATE:  September 27, 1999
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National Park Service Soil Surveys, B-282601, September 27, 1999

Decision

Matter of: National Park Service Soil Surveys

File: B-282601

Date: September 27, 1999

DIGEST

  1. Subsection 1535(d) the Economy Act, 31 U.S.C. sect. 1535(d), requires an
     ordering agency to deobligate funds at the end of the period of
     availability unless the servicing agency has completed performance or
     awarded a contract for the goods or services. Here, the National Park
     Service entered into interagency agreements for soil surveys with the
     National Resource Conservation Service, Department of Agriculture,
     pursuant to a statute other than the Economy Act. Where an interagency
     agreement is based on specific statutory authority other than the
     Economy Act, an agency is not required to deobligate funds at the end
     of the period of availability since section 1535(d) only applies to
     interagency agreements under the Economy Act.
  2. A time limited appropriation may be obligated only to meet a
     legitimate, or bona fide, need of the fiscal year in which the
     appropriation is made. Generally, funds may be obligated for the
     provision of services beyond the fiscal year in which the appropriation
     is made only to the extent those services constitute a single
     nonseverable undertaking.

DECISION

Mr. John J. Reynolds, Regional Director, Pacific West, National Park
Service, United States Department of Interior asks whether fiscal year 1998
funds obligated for soil surveys pursuant to interagency agreements with the
National Resource Conservation Service, Department of Agriculture, remain
available to pay for ordered services provided subsequent to fiscal year
1998. For the reasons stated below, to the extent the National Park Service
has ordered nonseverable services, the fiscal year 1998 funds remain
available to liquidate the obligation.

BACKGROUND

The National Park Service (NPS) has an ongoing need for soil surveys
incident to its inventorying and monitoring of a number of properties that
it manages. The NPS uses the results of the soil surveys to assist in
determining the suitability of uses and activities of the property.
Beginning in 1995, after a review of various options, NPS entered into a
series of interagency agreements with the National Resource Conservation
Service, Department of Agriculture (NRCS), to obtain soil surveys at various
NPS locations. Each agreement delineated specific tasks organized in two or
three phases across several fiscal years and culminating in the publication
of a final soil survey report for each location. Under these agreements, NPS
transferred funds to NRCS each year to cover each phase of the soil survey
work. NPS states that a major factor for entering into these interagency
agreements was NRCS? assurances that 42 U.S.C. sect. 3274 would, in effect,
convert NPS? annual funds to no-year funds and prevent the funds from
lapsing at the end of their period of availability. [1]

The Office of the General Counsel, USDA, issued a legal opinion dated
December 28, 1998, in connection with one such soil survey agreement. The
opinion concluded that the interagency agreement is subject to the Economy
Act. Under the Economy Act, NRCS would have to deobligate any NPS funds at
the end of the fiscal year to the extent that NRCS, the performing agency,
has not incurred obligations by performing the work or entering into valid
contracts for the work. 31 U.S.C. sect. 1535(d) (1994).

The USDA counsel explored the various statutory authorities of NPS and NRCS
to enter into an agreement for soil surveys. The memorandum concluded that
both NPS and NRCS have authority to enter into interagency agreements for
soil surveys of NPS? lands. With respect to NPS, the opinion cites the
Secretary of Interior?s authority to cooperate with federal departments and
agencies and obtain "information, data, reports, advice, and assistance that
are needed." 16 U.S.C. sect. 460l-1 (1994). The opinion also notes that that
provision specifically authorizes other federal agencies to expend funds for
such purposes, with or without reimbursement. Id. Likewise, the USDA counsel
found that NRCS has broad authority to conduct soil surveys under 16 U.S.C.
chapter 3B, Soil Conservation. However, the opinion concluded that the
statutory provision cited by the interagency agreement as authority to
preserve NPS? funds across fiscal years, 42 U.S.C. sect. 3274, only applies to
certain funds appropriated to USDA, and thus cannot serve as authority to
preserve the NPS funds beyond the fiscal year.

We agree with the USDA counsel that both NPS and NRCS have authority to
enter into interagency agreements independent of the Economy Act. These
interagency agreements were not based on the authority of the Economy Act,
however. Thus, any NPS funds that are properly obligated under such an
agreement do not lapse at the end of the fiscal year. We also agree with the
USDA counsel that section 3274, which relates to appropriations for NRCS,
does not apply to NPS funds. [2]

ANALYSIS

The USDA legal opinion concluded that NPS? funds would expire at the end of
each fiscal year due to a provision of the Economy Act, 31 U.S.C. sect. 1535(d).
As noted above, that subsection requires that any funds obligated by the
ordering agency under an interagency agreement must be deobligated at the
end of their period of availability unless the performing agency has
completed performance or entered into a binding agreement with a contractor
to provide the ordered goods or services.

The obligational treatment of funds under an interagency agreement depends
on whether an agency enters into an agreement for goods or services under
the Economy Act or possesses other specific statutory authority to obtain
goods or services from other agencies. 51 Comp. Gen. 766 (1972). The
distinction is an important one since the deobligation requirement of
section 1535(d) is unique to Economy Act transactions. It does not apply to
interagency agreements that are specifically authorized by law. 59 Comp.
Gen. 563 (1980); 55 Comp. Gen. 1497 (1976); B-167790, Sept. 22, 1977; see
generally, 2 Principles of Federal Appropriations Law, p. 7-22 (GAO/OGC
92-13). Where an interagency agreement is based on specific statutory
authority independent of the Economy Act, the funds do not expire at the end
of the period of availability if they have been otherwise properly
obligated. 73 Comp. Gen. 77 (1994); B-257977, Nov. 15, 1995.

Thus, a threshold question is whether the interagency agreements involved
here are subject to the Economy Act. The interagency agreement between NPS
and NRCS specifically refers to16 U.S.C. sect. 460l-1(g) (1994). That section
authorizes NPS to

          "[c]ooperate with and provide technical assistance to Federal
          departments and agencies and obtain from them information, data,
          reports, advice and assistance that are needed and can reasonably
          be furnished in carrying out the purposes of this part [National
          Parks, outdoor recreation programs] * * * * Any department or
          agency furnishing advice or assistance hereunder may expend its
          own funds for such purposes, with or without reimbursement, as may
          be agreed to by that agency."

This section authorizes NPS to enter into interagency agreements with other
federal departments and agencies for the purposes stated. It also authorizes
a servicing agency to use its own funds or seek reimbursement from NPS for
any services provided.

The interagency agreement also refers to the authority of NRCS, through the
Secretary of Agriculture, to "coordinate and direct all activities with
relation to soil erosion * * * (1) To conduct surveys, investigations, and
research relating to the character of soil erosion and the preventive
measures needed * * * *." 16 U.S.C. sect. 590a. The Secretary is further
authorized by 16 U.S.C. sect. 590k to transfer funds both within the Department
and to other agencies of the federal government to carry out the soil
conservation provisions of 16 U.S.C. sect. 590a - 590q. Thus, the Secretary of
Agriculture is authorized to "coordinate and direct" activities relating to
soil erosion, including soil surveys, and to transfer funds appropriated to
the Department for this purpose to other agencies.

Both of these provisions provide authority independent of the Economy Act
for NPS and NRCS to enter into the interagency agreements at issue here. See
52 Comp. Gen. 128 (1972). However, since the soil surveys are incident to
NPS? management of the National Park system, we conclude that the primary
authority for the particular agreements at issue is 16 U.S.C. sect. 460l-1(g).
As the ordering agency, its funds are properly chargeable for the costs that
NRCS incurs in providing soil surveys for National Park system properties.
It follows that the Economy Act deobligation requirement does not apply to
funds obligated under the authority of section 460l-1(g). Those funds, if
otherwise properly obligated, would not be deobligated at the end of the
fiscal year, but would remain available to liquidate the obligations.

BONA FIDE NEEDS RULE

The final issue is whether NPS otherwise properly obligated its one-year
funds. Under the bona fide needs rule, an appropriation limited in time may
be obligated only to meet a legitimate need of the time period for which
Congress provided the appropriation. 73 Comp. Gen. 77 (1994); 70 Comp. Gen.
296 (1991); B-257977, Nov.15, 1995. Thus, an agency may obligate a fiscal
year appropriation for the provision of services that extend beyond the
fiscal year in which the appropriation is made only to the extent those
services constitute a single nonseverable undertaking. 73 Comp. Gen. 77
(1994); 70 Comp. Gen. 296 (1991); B-257977, Nov. 15, 1995; see generally, 2
Principles of Federal Appropriations Law, p. 5-22 (GAO/OGC 91-5). The term
"severable services" refers to those services which are continuing and
recurring in nature, such as window cleaning, maintenance or security
services, etc., where an agency realizes a benefit at the time that services
are provided even if the contract is not fully performed. In other words,
severable services are those services that can be separated into components
that independently provide value to meet agency needs. Under the bona fide
needs rule, any portion of severable services completed in a subsequent
fiscal year are severable and, thus, chargeable to appropriations available
in the subsequent year. 58 Comp. Gen. 321 (1979).

There is insufficient information in the supporting documents submitted by
NPS to permit us to determine to what extent the particular services called
for under each agreement entered into between NPS and NRCS constitute either
severable or nonseverable services. For example, the Interagency Agreement
for the Yosemite National Park dated September 29, 1995, sets forth specific
work that NRCS is required to perform in order to complete each phase of the
project. These include such items as completed methodology, aerial
photographs, purchases of equipment, soil survey correlation, interim
reports and a final report for the areas designated for soil surveys. While
each phase and each item within each phase may be necessary for the ultimate
completion of the soil survey of each NPS property, it is unclear to what
extent these tasks independently provide value to meet agency needs.
73 Comp. Gen. 77 (1994). NPS should review the transactions under each of
its agreements with NRCS to determine whether the particular services are
severable or nonseverable. NPS should then adjust its accounts based on the
results of this analysis.

CONCLUSION

NPS entered into a number of binding written agreements with NRCS pursuant
to 16 U.S.C. sect. 460l-1(g). Under these agreements, NRCS would perform certain
agreed upon functions leading to soil surveys for specific NPS properties.
Since NPS has statutory authority for these interagency agreements, NPS
funds obligated pursuant to these agreements are not subject to the
deobligation requirement of the Economy Act, 31 U.S.C. sect.1535(d). To the
extent the funds were properly obligated consistent with the bona fide needs
rule, they remain available to liquidate the obligation.

Comptroller General
of the United States

Notes

1. Section 3274 authorizes no-year appropriations to be made to the
Department of Agriculture to carry out a soil survey program. It states,
"There are hereby authorized to be appropriated such sums as may be
necessary to carry out the purposes of this chapter, such sums to remain
available until expended."

2. NPS emphasizes that each agreement specifically refers to section 3274,
stating that "NRCS acknowledges in the Agreement that 42 U.S.C. sect. 3274
authorizes the NRCS to utilize the funds that NPS transfers to the NRCS
until the funds are expended for the purposes of the Agreement." As noted
above, section 3274 authorizes appropriations to be made on a no-year basis
for USDA?s soil survey program. It has no bearing on appropriations made to
NPS, even if transferred to USDA pursuant to an interagency agreement to
conduct soil surveys.