TITLE:  Use of Conservation Operations Appropriation to Fund Technical  Assistance for Conservation Programs Enumerated inSection 2701 of the  2002 Farm Bill, B-300325, December 13, 2002
BNUMBER:  B-300325
DATE:  December 13, 2002
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Use of Conservation Operations Appropriation to Fund Technical Assistance for
Conservation Programs Enumerated inSection 2701 of the 2002 Farm Bill, B-300325,
December 13, 2002

   B-300325
    
December 13, 2002
    
The Honorable Herb Kohl
Chairman
The Honorable Thad Cochran
Ranking Minority Member
Subcommittee on Agriculture, Rural
     Development, and Related Agencies
Committee on Appropriations
United States Senate
    
Subject: Use of Conservation Operations Appropriation to Fund Technical
Assistance for Conservation Programs Enumerated inSection 2701 of the 2002
Farm Bill
    
This responds to your letter of October 9, 2002, requesting our legal
opinion on issues related to the funding of technical assistance for the
conservation programs enumerated in section 2701 of the Farm Security and
Rural Investment Act of 2002 (2002 Farm Bill).  In B‑291241,
October 8, 2002, we found that the Department of Agriculture's
(Agriculture) conservation operation (CO) appropriation was not available
to fund technical assistance for section 2701 conservation programs.  You
asked us to:  (1) ascertain whether Agriculture had used the CO
appropriation in the last quarter of fiscal year 2002 for technical
assistance for section 2701 programs and, if so, the total amount of CO
funds expended for that purpose; and (2) describe the actions that
Agriculture must take to ensure proper accountability of Commodity Credit
Corporation (CCC) and CO funds. 
    
We found that Agriculture improperly obligated approximately $20.8 million
of the CO appropriation to pay for technical assistance for section 2701
conservation programs in the last quarter of fiscal year 2002.  Because
the CO appropriation was not available for that purpose, Agriculture's
obligation of the CO appropriation violated 31 U.S.C. S: 1301(a), which
prohibits the use of appropriations for purposes other than those for
which they were appropriated.  To ensure proper accounting of the CO and
CCC appropriations, Agriculture must adjust both appropriation accounts,
deobligating the $20.8 million improperly charged to the CO appropriation
and charging that amount to the CCC account.  Agriculture, however, has
not requested an apportionment from the Office of Management and Budget
(OMB) of CCC funds to cover the $20.8 million of section 2701 technical
assistance obligations.  Thus, Agriculture has violated the Antideficiency
Act, 31 U.S.C. S: 1341(a), which prohibits making or authorizing an
expenditure or obligation that exceeds available budget authority.   
    
BACKGROUND
    
Because your questions arise from many of the same facts that we addressed
in our opinion, B‑291241, October 8, 2002, we will not repeat them
here.  In that opinion, we found that Agriculture's CO appropriation was
not available to provide technical assistance to section 2701 conservation
programs[1] because the CO appropriation, by its own terms, did not
finance the section 2701 conservation programs.  The appropriation
specifically identified a number of programs, but the section 2701
conservation programs were not among them.  We pointed out that even if
one could reasonably read that appropriation to fund these conservation
programs, the Congress, with enactment of section 2701 of the 2002 Farm
Bill on May 13, 2002, required that the Secretary of Agriculture *shall
use the funds* of the CCC to carry out the seven conservation programs
enumerated therein, including the provision of technical assistance. 
Since section 2701 specifically states that funding for its conservation
programs *shall* come from CCC funds, the CO appropriation was not
available for that purpose.[2]
    
In the opinion, we stated that:
    
*To the extent that Agriculture might have used the CO appropriation for
WRP [Wetlands Reserve Program], Agriculture would need to adjust its
accounts accordingly, deobligating amounts it had charged to the CO
appropriation and charging those amounts to the CCC funds.  We note that
in this event OMB would need to apportion additional amounts from CCC
funds to cover such obligations.* [3]
    
    
    
    
DISCUSSION
    
To respond to your request, we contacted Agriculture to determine whether
Agriculture had used the CO appropriation in the last quarter of fiscal
year 2002 for technical assistance for section 2701 programs and, if so,
the total amount of CO funds expended for that purpose.  Agriculture
officials informed us that Agriculture obligated approximately
$20.8 million of the CO appropriation during the last quarter of fiscal
year 2002.[4]  Notwithstanding our October 8 opinion, Agriculture has
taken no action to correct its improper obligation of the CO
appropriation.[5]  Agriculture has not asked OMB for an apportionment to
permit correction of the improper obligation of CO funds.
    
As we alerted Agriculture in our October 8 opinion, Agriculture's use of
CO funds is improper and violates 31 U.S.C. S: 1301(a).  Section 1301(a)
prohibits the use of appropriations for purposes other than those for
which they were appropriated.  B‑290005, July 1, 2002.  The CO
appropriation is not available to fund the section 2701 conservation
programs; Agriculture must use CCC funds for that purpose.  B-291241, Oct.
8, 2002.
    
To ensure proper accounting of the CO and CCC appropriations, Agriculture,
as we explained in our October 8 opinion, must adjust both appropriation
accounts, deobligating the $20.8 million improperly charged to the CO
appropriation and charging that amount to the CCC account.  Because
Agriculture has not adjusted its accounts, we conclude that Agriculture
has violated the Antideficiency Act.
    
Antideficiency Act
    
Agriculture, in addition to violating 31 U.S.C. S: 1301(a), has violated
the Antideficiency Act.  The Antideficiency Act prohibits an agency from
incurring obligations that exceed the amount of available budget
authority.  31 U.S.C. S: 1341(a).  The $20.8 million in obligations that
Agriculture improperly charged to its CO appropriation exceed the amounts
of CO appropriation available for this purpose, which is zero.  See
B‑229732, Dec. 22, 1988.  The Antideficiency Act requires agencies
to report such overobligations to the Congress and the President.  31
U.S.C. S: 1351.  Given our October 8, 2002, opinion on the unavailability
of the CO appropriation for this purpose, and because Agriculture was put
on notice of a possible Antideficiency Act violation more than 2 months
ago and still has not initiated any corrective action to ensure proper
accounting of the CO and CCC appropriations, we will send copies of this
opinion to the Speaker of the House and the President of the Senate to
notify both Houses of the Congress of the violation.
    
CONCLUSION
    
Agriculture improperly obligated approximately $20.8 million of the CO
appropriation to pay for section 2701 technical assistance in the last
quarter of fiscal year 2002.  As a consequence, Agriculture violated 31
U.S.C. S: 1301(a) and the Antideficiency Act, 31 U.S.C. S: 1341(a). 
    
We hope you find this information useful.  If you have any questions,
please contact Susan A. Poling, Associate General Counsel, or Thomas
Armstrong, Assistant General Counsel, at 202-512-5644.  We are sending
copies of this letter to the Secretary of Agriculture, the Director of
OMB, the Chairmen and Ranking Minority Members of the House and Senate
Agriculture Committees and the House and Senate Appropriations
Committees.  This letter will also be available on GAO's home page at
http://www.gao.gov.
    
    
/signed/

   Anthony H. Gamboa
General Counsel
    
DIGEST
    
The Department of Agriculture improperly obligated approximately $20.8
million of its conservation operations appropriation in the last quarter
of fiscal year 2002 to pay for technical assistance for conservation
programs enumerated in section 2701 of the 2002 Farm Bill instead of using
Commodity Credit Corporation (CCC) funds as required by section 2701.  As
a consequence, Agriculture violated 31 U.S.C. S: 1301(a) and the
Antideficiency Act, 31 U.S.C. S: 1341(a)(1). 
    

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   [1] The seven conservation programs are:  (1) the conservation reserve
program (CRP), (2) the wetlands reserve program (WRP), (3) the
conservation security program (CSP), (4) the farmland protection program
(FPP), (5) the grassland reserve program (GRP), (6) the environmental
quality incentives program (EQIP), and (7) the wildlife habitat incentives
program (WHIP).  According to Agriculture officials, the CSP and GRP have
not yet been implemented.
[2] It is well settled, we explained, that even an expenditure that may be
reasonably related to a general appropriation (such as the CO
appropriation) may not be paid out of that appropriation where the
expenditure falls specifically within the scope of another appropriation
(such as section 2701).  63 Comp. Gen. 422, 427-28, 432 (1984);
B‑290005, July 1, 2002.
[3] While this statement was made regarding the WRP, we indicated that the
same legal principles would apply to other section 2701 programs.
[4] Agriculture officials told us that Agriculture may, in fact, be
obligating the CO appropriation for  section 2701 conservation programs
during fiscal year 2003.
[5] Consistent with our October 8, 2002 opinion, Agriculture should
ascertain whether it obligated additional amounts from the CO
appropriation after the 2002 Farm Bill was enacted (May 13, 2002) to pay
for any expenditures associated with the section 2701 conservation
programs and, if necessary, take action to cure those improper obligations
as well.