Continued Availability of Expired Appropriation for Additional Project, B-286929, April 25, 2001

B-286929 Apr 25, 2001 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights The certifying officer for the U.S. Total Army Personnel Command (PERSCOM) requested a decision regarding the continued availability of a fiscal-year 1997 appropriation to cover additional phases of a project initiated through an interagency agreement with the General Services Administration. PERSCOM contended that since it needed only $8.5 million of a total of $17.5 million obligated for one phase of the three-phase project, it should be allowed to apply the remaining amount to the remaining two phases of the project. GAO held that because PERSCOM entered into an agreement incurring an obligation for only one phase of the project, it cannot now use the remainder of the fiscal year 1997 appropriation for the additional phases. View Decision Continued Availability of Expired Appropriation for Additional Project Phases B-286929 April 25, 2001   DIGEST   DECISION The certifying officer for the U.S. Total Army Personnel Command (PERSCOM) requests a decision regarding the continued availability of a fiscal-year 1997 appropriation to cover additional phases of a project initiated through an interagency agreement with the General Services Administration (GSA), as authorized by 40 U.S.C. Sec. 757. PERSCOM, in 1997, obligated its fiscal year 1997 appropriation in the amount of $17.5 million for one phase of a three-phase project. To complete the first phase, PERSCOM needed only $8.5 million of the total amount obligated. PERSCOM would now like to apply the remaining amount to the remaining two phases of the project. Because PERSCOM entered into an agreement incurring an obligation for only one phase of the project, it cannot now obligate and charge payments for additional phases to the expired fiscal year 1997 appropriation. BACKGROUND Executive Order (EO) 12958, Classified National Security Information, dated April 17, 1995, prescribes a uniform system for classifying, safeguarding, and declassifying national security information. Pursuant to E.O. 12958, the U.S. Army is required to develop and implement a classified information management system for review of classified records prior to declassification to prevent the release of classified information that may have a negative impact on national security. Department of the Army Headquarters delegated the mission of developing and implementing a declassification information management system to PERSCOM. To accomplish this task, PERSCOM entered into an agreement on May 2, 1997 with the GSA's Federal Systems Integration and Management Center (FEDSIM). FEDSIM provides a wide range of technical and contracting services to federal agencies related to the acquisition, management and use of information systems and technology. The agreement was authorized pursuant to the Brooks Act, Sec. 111, Pub. L. No. 89-306, as amended, now codified at 40 U.S.C. Sec. 757. Section 757 provides GSA statutory authority to enter into multiyear contracts for the provision of information technology hardware, software, or services for periods up to five years. The agreement stated as follows: "FEDSIM derives its financing from the Information Technology Fund, a revolving fund established under the authority of the Brooks Act (PL 89-306) as amended by the Paperwork Reduction Reauthorization Act of 1986, as included in PL 99-500 and PL 99-591. In accordance with a Comptroller General ruling (Memorandum of Decision, File B-186535, Matter of: Interagency Agreement -- Administrative Office of the U.S. Courts), payments for FEDSIM services under this agreement are governed by the terms of the Brooks Act rather than the Economy Act. Under these terms, the existence of a defined requirement at the time this Basic Agreement is executed forms the basis for the incurring and recording of a financial obligation on the part of the client. This obligation remains in force across fiscal year boundaries until the specified services are delivered or the Agreement is rescinded by the signatories. The funds so obligated by the client do not have to be deobligated at the end of a fiscal year as they would have been if subject to the Economy Act. The client should ensure that any financial obligation incurred under this Agreement is properly recorded so that the funds are available to pay for FEDSIM services for the duration of this Agreement." The agreement articulated a three-phase project, but provided for only the first phase. The agreement stated that "This Basic Agreement addresses Phase I. Phase II and III will be addressed upon completion of Phase I." Phase I, which the parties called a Proof of Principle, consisted of designing and testing. Phase II will consist of establishing the declassification program in accordance with the provisions of E.O. 12958.