TITLE:  Prize Drawing by General Services Administration's Public Buildings, B-286536, November 17, 2000
BNUMBER:  B-286536
DATE:  November 17, 2000
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Prize Drawing by General Services Administration's Public Buildings,
B-286536, November 17, 2000

Decision

Matter of: Prize Drawing by General Services Administration's Public
Buildings Service

File: B-286536

Date: November 17, 2000

DIGESTS

1) The General Services Administration's (GSA) Public Buildings Service
(PBS)  distributes customer surveys to employees of tenant-agencies in
GSA-managed buildings in order to develop customer satisfaction information.
To enhance the response rate to the surveys, PBS proposes to use the Federal
Buildings Fund to provide work-related prizes to survey recipients whose
names PBS chooses in a drawing connected to the survey. Since GSA has
established that customer satisfaction information is useful in carrying out
its statutory mission to operate, maintain and protect federally owned and
leased buildings, and since the survey recipients have no statutory,
regulatory or employment-related duty to reply to the survey, we have no
objection to GSA's use of the Federal Buildings Fund for this purpose.

2) Because an award of prizes in a drawing accompanying a survey might be
construed to contain elements of a lottery prohibited by certain federal
criminal statutes and regulations, see 18 U.S.C. sect.sect. 1301--1304, GSA should
consult with the Department of Justice to ensure that its proposal is not a
prohibited lottery before spending appropriated funds as proposed.

DECISION

By letter of October 11, 2000, the General Services Administration (GSA)
requested an advance decision on whether the Public Buildings Service (PBS)
may use appropriated funds to pay for prizes in a drawing held in connection
with customer satisfaction surveys. PBS proposes to conduct the drawing and
award prizes in order to increase the response rate to customer satisfaction
surveys and achieve a statistically valid representation of the satisfaction
level of its customers. We conclude that PBS may use appropriated funds to
pay for prizes in a drawing held in connection with customer satisfaction
surveys to the extent discussed below. [1]

BACKGROUND

Pursuant to section 210(a) of the Federal Property and Administrative
Services Act of 1949, as amended (codified as 40 U.S.C. sect. 490), the
Administrator, General Services, is responsible for the operation,
maintenance, and protection of all government owned and leased buildings
under GSA control. According to GSA, its inventory comprises approximately
40% of all federal office space. Pursuant to the Public Buildings Act of
1959 (codified as 40 U.S.C. sect.sect. 601-619), the Administrator also is
responsible for the construction and alteration of public buildings. The Act
requires the Administrator to make a continuing investigation and survey of
the public building needs of the federal government in order to remain
informed regarding the building needs of all federal agencies. 40 U.S.C. sect.
611(a)-(b). The Administrator has delegated these responsibilities to GSA's
Public Buildings Service.

The Government Performance and Results Act of 1993 (GPRA) requires federal
agencies to set goals, measure performance, and report on their
accomplishments. Pub. L. No. 103-62, 107 Stat. 285. The Act requires
agencies to develop strategic plans that include comprehensive mission
statements based on the agency's statutory requirements, a set of strategic
goals, and a description of how the agency intends to achieve these goals.
In its submission to us, GSA explained that its mission, as articulated in
its strategic plan, is to provide policy leadership and expert solutions in
services, space and products, at the best value, to enable federal employees
to accomplish their missions.

One approach PBS has chosen to advance its statutory mission is to collect
information on its customers' satisfaction with PBS's services through the
use of customer satisfaction surveys. The survey requests that federal
employees [2] of tenants in GSA-controlled buildings rate their level of
satisfaction with their building and office environment, the services
provided by the building management staff, and safety and security issues in
the building. The goal of the survey is to measure performance as well as to
identify long and short term program improvements. According to material
provided to us by GSA, average national response rates to PBS customer
satisfaction surveys declined from a 52% response rate in 1993, to a 32%
response rate in 1998, despite continuous efforts and the use of a variety
of approaches to increase overall response rates.

In 1999, GSA awarded a contract to Gallup Organization to assist PBS in
conducting its customer satisfaction surveys. To counter the decline in
survey response rates, in January 2000, PBS, with the assistance of Gallup,
conducted a pilot test using a drawing in conjunction with a standardized
customer satisfaction survey. PBS distributed drawing entry forms along with
the survey. To participate in the drawing, recipients had to submit the
drawing entry form, but were not required to complete the survey. [3] The
Gallup Organization advised PBS that a small proportion of people will
return the drawing entry form only and not complete the survey; however, the
usual result is that more people complete the survey than would if there
were no drawing. PBS awarded three laptop computers as grand prizes, as well
as 150 portfolio cases, to employees whose forms were pulled in the drawing.
According to material provided by GSA, following the pilot, the overall
response rate rose from 32% to 51%. In addition, following the pilot test,
the number of buildings surveyed that had response rates below 30% declined
from 25% of buildings surveyed in 1998, to 8.9%. GSA has stated that
according to Gallup, a response rate of at least 30% is needed to have
confidence that the survey results are valid and representative of the
satisfaction level of survey respondents. GSA proposes to formalize its
pilot as a regular, annual practice. In fiscal year 2001, PBS plans to
expand the survey and drawing to include its regional offices. As a result,
the number of laptop computers awarded as grand prizes will increase from
three to eleven. In addition, 150 leather portfolio cases filled with
work-related items will be awarded. GSA estimates that the total annual cost
of the prizes will not exceed $35,000.

GSA proposes to pay the costs of the prizes from the Federal Buildings Fund.
Monies deposited into the fund are available for expenditures for real
property management and related activities in such amounts as are specified
in annual appropriations acts. 40 U.S.C. sect. 490(f). The Treasury and General
Government Appropriations Act, 2000, permitted revenues and collections
deposited into the Federal Buildings Fund to be used for necessary expenses
of real property management and related activities, including operation,
maintenance, and protection of federally owned and leased buildings. Pub. L.
No. 106-58, 113 Stat. 430. On October 30, 2000, the President vetoed the
combined Legislative Branch and Treasury-Postal Service appropriations bill
for fiscal year 2001, which included similar language. [4]

DISCUSSION

Pursuant to 31 U.S.C. sect. 1301(a) (1988), appropriated funds may be used only
for authorized purposes. Even if a particular expenditure is not
specifically provided for in the appropriation act, the expenditure "is
permissible if it is reasonably necessary in carrying out an authorized
function or will contribute materially to the effective accomplishment of
the function, and if it is not otherwise prohibited by law." 66 Comp. Gen.
356 (1987).

We have held that whether or not a particular expense is necessary in
fulfilling an authorized purpose is, in the first instance, a matter of
agency discretion. B-223608, Dec. 19, 1988. When we review an expense to
determine if it is necessary to fulfill an authorized purpose, we determine
whether the expense falls within the agency's legitimate range of
discretion, or whether its relationship to an authorized purpose is so
attenuated as to take it beyond the range. Id.; 70 Comp. Gen. 720 (1991).

We have concluded in several instances that agencies may use appropriated
funds to provide prizes to individuals to further the collection of
information necessary to the accomplishment of the agency's statutory
mandate. For example, in 70 Comp. Gen. 720 (1991), we held that the National
Oceanic and Atmospheric Administration (NOAA), Department of Commerce, could
use appropriated funds to pay cash prizes to encourage fishermen to return
information used by NOAA for research on the history and migration rate of
certain fish. To facilitate this research, NOAA issued fish tags containing
questions about the circumstances under which the fish was caught. NOAA had
been distributing a $5 reward for the return of each fish tag, but proposed
expanding the reward program to include the alternative of participating in
an annual drawing for a limited number of cash prizes. NOAA proposed to
offer $1,000 for first prize and $500 each for two additional prizes.

In our decision, we noted that the Department of Commerce is statutorily
required to conduct research to support fishery conservation and management.
Because the prizes were intended to induce fishermen to return fish tags
that would facilitate NOAA's acquisition of information needed for its
statutorily required research, the proposed prizes were reasonably necessary
to the accomplishment of an authorized purpose.

We also concluded that the Army could use appropriated funds to pay for
framed posters, which the Army distributed as prizes to winners of drawings
in order to collect information needed for recruiting purposes. B-230062,
Dec. 22, 1988. The Army was statutorily required to conduct "intensive
recruiting campaigns to obtain enlistments" and annual appropriations were
provided for this purpose. The purpose of the prizes was to prompt
individuals to provide "directory information" to the recruiters, including
addresses and telephone numbers, in order to "continue the dialogue" with
potential recruits. We found a direct connection between the purchase of
posters to obtain recruiting information and the Army's statutory mandate to
"conduct an extensive recruiting campaign." Therefore, this was a
permissible expenditure of appropriated funds. [5]

Factually, there is one difference between this case and the decisions
discussed above. In those decisions, the agencies awarded prizes to the
general public whereas here GSA proposes to award prizes to federal
employees. We do not view this distinction as meaningful under the
circumstances presented here. First, GSA proposes to randomly distribute
surveys and drawing cards to federal employees in GSA-tenant buildings to
ensure that survey recipients will represent many different agencies and job
classifications. Second, most of the employees selected to receive the
survey will be under no statutory, regulatory, or employment-related
requirement to return the survey to GSA. [6] In this particular drawing,
federal employees will not be receiving prizes for what they already are
required to do, and are in this sense akin to the general public.

While the Federal Buildings Fund does not specifically provide budget
authority to GSA to cover the cost of prizes, we see a direct connection
between the purpose of the Fund and the use of prizes to increase the
response rate to customer satisfaction surveys. Because GSA's statutory
mission is to operate, maintain, and protect GSA-controlled buildings as
well as to ensure that the building needs of federal agencies are met, it is
necessary for GSA to collect valid information about the status of federal
buildings and the needs of federal employees. Also, as noted earlier, GPRA
places a premium on agency acquisition of information needed to measure
performance towards their goals since agencies now must report annually on
their performance. Pub. L. No. 103-62, 107 Stat. 285.

One important way to collect measurable information on performance is
through the use of data collection instruments. Indirect incentives, such as
self-addressed, postage-paid envelopes, free software to compile requested
information, and free copies of publications resulting from the survey, are
commonly used by the federal government to collect data for a variety of
purposes. No objections to these practices have been raised. GSA does not
control the surveyed employees nor does it have the authority to compel
federal employees to return data collection instruments. However, by using
incentives, it can encourage federal employees to provide the information it
needs. Indeed, GSA has demonstrated, statistically, that conducting a
drawing in connection with its customer satisfaction surveys will enhance
the response rate to the survey and, thus, the value to GSA of the
information that GSA obtains from its customers. We, therefore, have no
objection to GSA's use of the Federal Buildings Fund for this purpose. [7]

Apart from the appropriations law issue addressed above, various federal
statutes prohibit federal employees and the public from participating in
lotteries except under limited circumstances. See, e.g., 18 U.S.C. sect.sect.
1301-1304. The essential elements of a lottery include: (1) the distribution
of prizes, (2) according to chance, (3) for consideration. See Federal
Communications Commission v. American Broadcasting Co, Inc., 347 U.S. 284
(1954). A test for sufficient consideration is "whether the act, forbearance
or return promise results in a benefit to the promisor or a detriment to the
promisee." Laurence P. Simpson, The Handbook of the Law of Contracts, 80 (2d
ed. 1965). The act, forbearance or return promise must be bargained for as
the required return for the promise. Id. at 99. In our 1991 NOAA decision,
we observed that its proposal to award prizes for the return of fish tags
contained the first two elements of a lottery and arguably the third, i.e.,
consideration. 70 Comp. Gen. 720 (1991). We suggested that NOAA consult with
the Department of Justice, the Office of Personnel Management, and
appropriate congressional committees before implementing the proposal.

In its submission, GSA noted its conclusion that by not requiring federal
employees to fill out a survey in order to enter the drawing, consideration
would not be required, and thus its drawing would not be a prohibited
lottery. We appreciate the point. However, since these statutes at issue are
criminal statutes, we offer no opinion on whether GSA's proposed drawing as
presently structured would avoid the consideration element of a prohibited
lottery. As we did in our response to NOAA, we suggest that GSA consult with
the Department of Justice before implementing its proposal.

Anthony H. Gamboa
Acting General Counsel

Notes

1. Pursuant to the Paperwork Reduction Act of 1995 (PRA) "an agency shall
not conduct or sponsor the collection of information unless[the Office of
Management and Budget] has approved the proposed collection of
information..." 44 U.S.C. 3507(a) & (a)(3). The Office of Management and
Budget's (OMB) implementing regulations state, however, that an agency does
not need to seek OMB review and approval to survey federal employees acting
in their professional capacities. 5 C.F.R. 1320.3(c)(4). Accordingly, GSA is
not required to seek OMB review and approval before implementing the drawing
and customer satisfaction survey discussed in this decision.

An agency that proposes to conduct a survey that is subject to PRA review is
required to justify to OMB any strategy that relies on incentives. 5 C.F.R.
1320.5(a)(1)(iii)(D). Pursuant to guidance that OMB has issued as an
exposure draft, OMB would conduct a case-by-case review to ensure that
incentives are only used in the context of a rigorous design that is
professionally implemented. OMB would also review proposals to ensure that
incentives are not used to offset the effects of poor questionnaires,
inadequate follow-up, imposition of inappropriate risks, or other
deficiencies that compromise respondent cooperation. See The Paperwork
Reduction Act of 1995: Implementing Guidance for OMB Review of Agency
Information Collection, Office of Information and Regulatory Affairs, Office
of Management and Budget (draft, Aug. 16, 1999).

The goal of the PRA is not only to minimize the federal paperwork burden,
but also to maximize the utility of information the government produces, as
well as to ensure its integrity. 35 U.S.C. 3501(10). While OMB's regulations
exempt surveys of federal employees acting in their professional capacities
from OMB review, any agency proposing to use incentives may wish to consider
consulting with OMB before implementing its proposal.

2. Recipients of surveys are randomly selected staff of GSA-tenant agencies
not necessarily involved in building management.

3. PBS employees are not eligible to participate in the drawing.

4. Since October 1, 2000, GSA has been operating under a series of
continuous resolutions that allow GSA to continue activities for which
appropriations were available during the previous fiscal year. See, e.g.,
Pub. L. No. 106-275, 114 Stat. 808 through October 6, 2000, and H.R.J. Res.
125, 106th Cong. (2000) through December 5, 2000.

5. See also decisions dealing with rewards for the furnishing of information
that is necessary to the effective administration and enforcement of the
law. B-172259, April 29, 1971 (holding that the Forest Service, which is
statutorily responsible for protecting the national forests from
destruction, could use appropriated funds to pay individuals for information
regarding violations of laws and regulations protecting national forests);
B-106230, Nov. 30, 1951 (holding that the Treasury Department could reward
informers for information or evidence on violations of the revenue, customs,
or narcotics laws under an appropriation for the necessary expense of law
enforcement); B-117628, Jan. 21, 1954 (holding that the Commerce Department
could pay rewards to informers as a necessary expense under a provision of
the Export Control Act of 1949 which authorized the obtaining of
confidential information incident to enforcement of the act).

6. While GSA may have the ability to influence GSA employees working in
GSA-tenant buildings to respond to the survey without offering incentives,
the number of GSA employees responding to the survey will comprise a small
proportion of total respondents.

7. Our decisions prohibiting the use of appropriated funds for personal
gifts are not applicable here. We have consistently held that agencies may
not use appropriated funds to purchase personal gifts or awards, except as
authorized by law. See 57 Comp. Gen. 385 (1978); 54 Comp. Gen. 976 (1975);
55 Comp. Gen. 346 (1975). In these cases, and in others in which we applied
the general prohibition, we based our conclusion on the absence of any
direct connection, such as exists in this case, between the purpose for
which the funds were appropriated and the gifts or awards in question.