TITLE: B-307382, Department of Homeland Security--Use of Management Directorate Appropriations to Pay Costs of Component Agencies, September 5, 2006
BNUMBER: B-307382
DATE: September 5, 2006
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B-307382, Department of Homeland Security--Use of Management Directorate Appropriations to Pay Costs of Component Agencies, September 5, 2006
B-307382
September 5, 2006
The Honorable Harold Rogers, Chairman
Subcommittee on Homeland Security
Committee on Appropriations
House of Representatives
The Honorable Martin Sabo, Ranking Member
Subcommittee on Homeland Security
Committee on Appropriations
House of Representatives
Subject: Department of Homeland Security--Use of Management Directorate
Appropriations to Pay Costs of Component Agencies
This responds to your letter of February 1, 2006, in which you requested
our legal opinion regarding the Department of Homeland Security's (DHS)
use of its Management Directorate appropriations to pay for certain costs
of several DHS component agencies. In considering a reprogramming request
submitted by DHS, the Committee on Appropriations learned that in fiscal
year 2005 the department had charged the costs of mail operations,
employee transit benefit subsidies, parking, and executive sedan services
for various DHS component agencies[1] to the department's Management
Directorate appropriations, rather than charging those costs to specific
appropriations which those components receive directly for "management and
administration" expenses.
As we explain below, either DHS's Management Directorate appropriations or
the various "management and administration" appropriations for the
subcomponents may be reasonably construed as available to pay the costs of
administrative activities such as mail operations, parking, and executive
sedan services incurred by component agencies. Having elected to use the
Management Directorate appropriations to pay the costs of mail operations,
parking, and executive sedan services for SLGCP, IAIP, and S&T ab initio,
DHS should continue to use that same appropriation to the exclusion of any
other for the same purpose unless DHS, at the beginning of the fiscal
year, informs Congress of its intent to change for the next fiscal year.
In fiscal year 2005, DHS charged the costs of employee transit benefit
subsidies to both the Management Directorate appropriations and the
"management and administration" appropriations for the three component
agencies, SLGCP, IAIP and S&T. As stated above, while both appropriations
may be reasonably construed to be available for the cost of employee
transit benefits, an agency must elect one and use it to the exclusion of
the other. Continued use of the same appropriation to the exclusion of any
other for the same purpose is required to provide for consistency,
regularity, and predictability in the execution of the appropriations
provided by Congress. DHS should elect to charge the costs of transit
benefit subsidies incurred by those three component agencies to either the
Management Directorate appropriations or the "management and
administration" appropriations for the respective DHS subcomponent and
adjust its fiscal year 2005 accounts accordingly.
Consistent with our customary practice when rendering opinions, upon
receipt of your request, we wrote a letter to DHS's General Counsel to
establish a record on the matter you put before us. Letter from Susan A.
Poling, Managing Associate General Counsel, GAO, to Philip J. Perry,
General Counsel, DHS, March 3, 2006. We requested factual information and
posed a series of questions to the General Counsel designed to permit us
to assess DHS's legal justification for charging such costs to the
appropriations accounts in question. We received a response from DHS on
April 24, 2006. Letter from Eugene Schied, Acting Chief Financial Officer,
DHS, to Susan A. Poling, GAO, March 30, 2006 (Schied Letter).
BACKGROUND
Under the Homeland Security Act of 2002, the Under Secretary for
Management is responsible for the management and administration of DHS,
including, inter alia, the budget, appropriations, expenditure of funds,
accounting, and finance; procurement; human resources and personnel;
facilities, property, equipment, and other material resources; and any
other management duties that the Secretary may designate. See 6 U.S.C.
sect. 341(a). DHS necessary expenses of the Office of the Under Secretary
for Management," as authorized by section 341. Department of Homeland
Security Appropriations Act, 2005, Pub. L. No. 108-334, title I, 118 Stat.
1298 (Oct. 18, 2004). See also Department of Homeland Security
Appropriations Act, 2006, Pub. L. No. 109-90, title I, 119 Stat. 2064
(Oct. 18, 2005).[2] Various DHS component agencies also received specific,
direct appropriations for "management and administration" for fiscal year
2005. The Office of State and Local Government Coordination and
Preparation (SLGCP), for example, received a specific "Management and
Administration" appropriation available "for necessary expenses" of that
office. Pub. L. No. 108-334, title III, 118 Stat. at 1309. Further, the
Office of the Under Secretary for Information Analysis and Infrastructure
Protection (IAIP) received a specific "Management and Administration"
appropriation available for "salaries and expenses" of the office "and for
management and administration of programs and activities." Id., title IV,
118 Stat. at 1314. Similarly, the Office of the Under Secretary for
Science and Technology (S&T) received a specific "Management and
Administration" appropriations available for "salaries and expenses" of
the office "and for management and administration of programs and
activities." Id., at 1315.
For fiscal year 2005, DHS charged the costs of mail operations, parking,
and executive sedan service[3] for SLGCP, IAIP, and S&T to the Office of
the Under Secretary for Management. Schied Letter. DHS charged some of the
costs of transit benefit subsidies of SLGCP, IAIP, and S&T for fiscal year
2005 to the Management Directorate appropriations and some costs of
transit benefit subsidies to the respective component appropriations. Id.
According to DHS, the Management Directorate paid for these costs because
that directorate was responsible for providing these services to the new
start-up organizations when DHS was created. Id.
The question arises whether fiscal year 2005 appropriations for the DHS
Office of the Under Secretary for Management were available to pay the
costs of mail operations, employee transit benefit subsidies, parking, and
executive sedan services incurred by these three DHS component agencies
that received separate, direct appropriations available for "management
and administration."
DISCUSSION
An agency may use appropriated funds only for the purposes for which
appropriated. 31 U.S.C. sect. 1301(a). Even if a particular expenditure is
not specifically provided for in the appropriation, the expenditure may be
permissible under the "necessary expense doctrine" if it will contribute
materially to the effective accomplishment of the function. B-301721, Jan.
16, 2004. We apply a three-part test to determine if the Management
Directorate appropriation is available for these purposes. First, the
expenditure must be reasonably related to the purposes that Congress
intended the appropriation to fulfill; second, the expenditure must not be
prohibited by law; and third, the expenditure must not fall within the
scope of another appropriation or funding source. See 63 Comp. Gen. 422,
427-28 (1984); B-251887, July 22, 1993.
When we consider the costs of mail operations, employee transit benefit
subsidies, parking, and executive sedan services, we find that these costs
meet the first two prongs of the necessary expense doctrine. Id. These
costs are reasonably related to the purpose that Congress intended the
Management Directorate appropriations to fulfill. See 6 U.S.C. sect.
341(a). See also Pub. L. No. 108-334, 118 Stat. at 1298, 1309, 1314, 1315.
Our cases, for example, have long found that mail operations are
reasonably related, and contribute materially, to the effective management
and administration of the programs administered by DHS and its component
agencies. See, e.g., 4 Comp. Gen. 256 (1924) (purchase of air mail stamps
for the transmittal of official matter may be properly regarded as a
necessary miscellaneous item of expense); B-212745, Apr. 15, 1985;
B-194851, Apr. 8, 1980. Cf. 39 U.S.C. sect. 3206.[4]
Federal agencies, including DHS, have specific authority to provide
employee transit subsidies, 5 U.S.C. sect. 7905, and executive sedan
services, see 40 U.S.C. sections 601-611. We have also found that
appropriated funds are available for the cost of parking.[5] See 72 Comp.
Gen. 139 (1993). See also 55 Comp. Gen. 897 (1976). The costs of mail
operations, employee transit benefit subsidies, parking, and executive
sedan services are not prohibited by law, and such expenditures are
reasonably related to the purposes that Congress intended DHS's various
management and administration appropriations to fulfill.
Under the third prong--what is at issue here--an expenditure must not fall
within the scope of another appropriation or funding source. 63 Comp. Gen.
at 427-28. Even an expenditure that may be reasonably related to a general
appropriation may not be paid out of that appropriation where the
expenditure falls specifically within the scope of another appropriation.
See, e.g., B-291241, Oct. 8, 2002; B-290005, July 1, 2002; B-289209, May
31, 2002. The question arises as to which appropriation account is
available to DHS for the costs at issue--DHS's "Management Directorate"
appropriations or appropriations specifically available to the component
agencies for "management and administration."
Where one can reasonably construe two appropriations as available for an
expenditure not specifically mentioned in either appropriation, we will
accept an administrative determination as to which appropriation to
charge. 68 Comp. Gen. 337 (1989). See also 5 Comp. Gen. 479 (1926). In 68
Comp. Gen. 337, we considered whether the Railroad Retirement Board should
use its general appropriation or a separate appropriation for the Board's
Office of Inspector General (OIG) to pay for performance awards to members
of the OIG's Senior Executive Service (SES). Because the head of the Board
makes determinations regarding performance awards under the Civil Service
Reform Act, we found that one could reasonably construe the Board's
general appropriation as available for payment of OIG SES performance
awards in the same manner and to the same extent as non-OIG SES
performance awards. 68 Comp. Gen. 337.
Alternatively, we found that one may reasonably construe the OIG
appropriation as available for payment of OIG performance awards; we
opined that the payment of performance awards from the appropriation
available for the activity which presumably benefited from the performance
being rewarded is not an unreasonable proposition. Id. Also, the Board
could view SES performance awards for OIG employees as akin to salaries
and thus chargeable to the OIG appropriation. Id. We concluded that the
Railroad Retirement Board could elect to use either appropriations to pay
the OIG SES performance awards because both appropriations could be
reasonably construed as available for that purpose. Id. However, once an
election is made, continued use of the same appropriation to the exclusion
of any other for the same purpose is required. 59 Comp. Gen. 518 (1980).
Similarly, we find that that either DHS's "Management Directorate"
appropriation or the "management and administration" appropriations for
DHS components are available to pay the costs of mail operations, employee
transit benefit subsidies, parking, and executive sedan services. DHS
could reasonably construe either appropriation as available for these
costs. Under provisions of the Homeland Security Act of 2002, the Under
Secretary for Management is responsible for the "management and
administration" of DHS, including, for example, the centralized provision
of services associated with such costs. See 6 U.S.C. sect. 341(a).
Alternatively, DHS could reasonably construe the various "management and
administration" appropriations for the SLGCP, IAIP, and S&T components as
available for such "necessary expenses." See, e.g., Pub. L. No. 108-334,
title III, 118 Stat. at 1309.
In this case, DHS elected to use the Management Directorate appropriations
to pay the costs of mail operations, parking, and executive sedan services
for the various start-up components ab initio. Schied Letter. We find this
construction reasonable. See 68 Comp. Gen. 337. Having elected to use the
Management Directorate appropriations, DHS should continue to use that
same appropriation to the exclusion of any other for the same purpose,
unless DHS, at the beginning of the fiscal year, informs Congress of its
intent to change for the next fiscal year. See B-272191, Nov. 4, 1997.
With regard to transit subsidy benefits for employees of IAIP, S&T and
SLGCP, DHS charged those costs to both the Management Directorate
appropriations and the management and administration appropriations for
those subcomponents. Schied Letter. As we mention above, continued use of
the same appropriation to the exclusion of any other for the same purpose
is required. 59 Comp. Gen. 518. This rule provides for consistency,
regularity, and predictability in the execution of appropriations provided
by Congress. U.S. General Accounting Office, Unsubstantiated DOE Travel
Payments, GAO/RCED-96-58R at 3 (Washington, D.C.: Dec. 28, 1995). In the
absence of such a rule, Congress might have to resort to the cumbersome
and detailed appropriations acts common many decades ago. Id.
Consistency is also required because, in addition to providing necessary
funding for federal programs and activities, an appropriation establishes
a maximum authorized program level. See B-300248, Jan. 15, 2004; 72 Comp.
Gen. 164 (1993). That is, the agency's ability to elect between two
appropriations available to pay for an expenditure does not mean that an
agency can elect to use (or exhaust) first one and then the other of the
two appropriations for the same class of expenditures. 10 Comp. Gen. 440,
447 (1931). See also 23 Comp. Gen. 827 (1944) ("The use of the
appropriations must be consistent.").
DHS should elect to charge the costs of transit benefit subsidies to
either the Management Directorate appropriations or the "management and
administration" appropriations for the respective subcomponent agency.
Under the authority of 31 U.S.C. sect. 1553(a), DHS should then adjust its
fiscal year 2005 accounts accordingly. Section 1553(a) permits agencies,
after the end of the period of availability for obligation of a fixed
appropriation account and before the closing of that account under section
1552(a) of title 31 of the U.S. Code, to record, adjust, and liquidate
obligations properly chargeable to that account.[6]
CONCLUSION
DHS's Management Directorate appropriations or the various "management and
administration" appropriations for the subcomponents may be reasonably
construed as available to pay for the costs of mail operations, parking
for official agency vehicles, and executive sedan services incurred by
component agencies. Having elected to use the Management Directorate
appropriations to pay these costs ab initio, DHS should continue to use
that same appropriation to the exclusion of "the management and
administration" appropriations of the various components unless DHS, at
the beginning of the fiscal year, informs Congress of its intent to change
for that next fiscal year.
In fiscal year 2005, DHS improperly charged the costs of employee transit
benefit subsidies to both the Management Directorate appropriations and
the "management and administration" appropriations for the three
subcomponent agencies, SLGCP, IAIP and S&T. DHS should elect to charge the
costs of transit benefit subsidies to either the Management Directorate
appropriations or the "management and administration" appropriations for
the respective DHS subcomponent and adjust its fiscal year 2005 accounts
accordingly.
Gary L. Kepplinger
General Counsel
B-307382
DIGESTS
1. Where one can reasonably construe two appropriations as available for
an expenditure not specifically mentioned under either appropriation,
we will not question an administrative determination as to which
appropriation to charge. Either Department of Homeland Security's
Management Directorate appropriations or the various "management and
administration" appropriations for DHS subcomponents, may be
reasonably construed as available to pay the costs of mail operations,
parking for official agency vehicles, and executive sedan services
incurred by component agencies. Having elected to use the Management
Directorate appropriations to pay such costs, DHS must now continue to
use that same appropriation to the exclusion of the management and
administration appropriations of the various components.
2. DHS charged fiscal year 2005 costs of employee transit benefit
subsidies to both the Management Directorate appropriations and the
"management and administration" appropriations for three subcomponent
agencies, SLGCP, IAIP and S&T. Continued use of the same appropriation
to the exclusion of any other for the same purpose is required to
provide for consistency, regularity, and predictability in the
execution of the appropriations provided by Congress. DHS should elect
to charge these costs to either the Management Directorate
appropriations or the "management and administration" appropriations
for the respective DHS subcomponent. DHS should then adjust its fiscal
year 2005 accounts accordingly under the authority of 31 U.S.C. sect.
1553(a).
------------------------
[1] Those component agencies were the Office of State and Local Government
Coordination and Preparation (SLGCP); the Office of the Under Secretary
for Information Analysis and Infrastructure Protection (IAIP); and Office
of the Under Secretary for Science and Technology (S&T). Under recent
reorganizations, SLGCP and IAIP were abolished. IAIP's functions were
divided into two new components--Analysis and Operations and the
Preparedness Directorate. See H.R. Conf. Rep. No. 109-241, at 30 (2005)
(discussing recent DHS reorganization under the agency's ``Second Stage
Review'').
[2] The Office of the Under Secretary for Management and its subordinate
offices (i.e., the offices of the Chief Financial Officer, Chief
Information Officer, Chief Human Capital Officer, Chief Administrative
Services Officer, Chief Procurement Officer, and Chief Security Officer)
are referred to collectively within DHS as the "Management Directorate,"
consistent with the other "directorates" established by the Homeland
Security Act of 2002. See 6 U.S.C. sections 341-345. See also "DHS
Organization, Department Structure, Directorate for Management" available
at http://www.dhs.gov/dhspublic/interapp/editorial/editorial_0096.xml
(last visited Aug. 2, 2006). Throughout this opinion, references to the
"Management Directorate" appropriations and appropriations for the "Office
of the Under Secretary for Management" are synonymous and used
interchangeably.
[3]Although DHS did not define "executive sedan service," for purposes of
this decision we presume that the service refers to the provision of local
transportation for official, authorized uses.
[4] Section 3206(a) permits agencies to reimburse the Postal Service for
penalty mail "out of any appropriations or funds available to them." This
statute permits federal agencies to use appropriations for one component
to pay penalty mail costs of another component funded under a separate
appropriation and does not constitute an unauthorized transfer of
appropriations or augmentation of funds. 33 Comp. Gen. 216 (1953). Penalty
mail means official mail, other than franked mail, which is authorized by
law to be transmitted in the mail without prepayment of postage. 39 U.S.C.
sect. 3201(1). To the extent that costs of mail operations may include
such reimbursement to the Postal Service, we would not object to DHS
charging any appropriation available to the agency for the costs of
penalty mail. 39 U.S.C. sect. 3206(a); 33 Comp. Gen. 216.
[5] While appropriated funds are available to provide parking facilities
generally, employee parking expenses incident to ordinary commuting are
personal expenses and thus not payable from appropriated funds. 63 Comp.
Gen. 270 (1984). An agency may provide employee parking facilities if it
determines that the lack of parking facilities will significantly impair
the operating efficiency of the agency and will be detrimental to the
hiring and retention of personnel. 72 Comp. Gen. 139 (1993).
[6] DHS could temporarily charge the costs of transit benefit subsidies to
the Management Directorate appropriations during fiscal year 2005 under
the authority of 31 U.S.C. sect. 1534, which permits agencies to make
adjustments at any time during the fiscal year between appropriations.