B-309181, Interagency Agreements--Use of an Interagency Agreement between the Counterintelligence Field Activity, Department of Defense, and GovWorks to Obtain Office Space, August 17, 2007

B-309181 Aug 17, 2007 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Without a delegation from the General Services Administration or independent statutory authority to enter into a lease, neither GovWorks (a Department of the Interior franchise fund) nor the Counterintelligence Field Activity (CIFA) of the Department of Defense (DOD) had authority to obtain office space through a third- party lease. Unless ratified by an appropriate government official, the agreement for office space is unenforceable against the government. GovWorks and CIFA cannot circumvent federal statutory and regulatory requirements on leasing by bundling the lease agreement in a contract for services. Without ratification, all payments made under this third-party lease are improper payments, and DOD and GovWorks should take appropriate action to resolve them. There is no evidence to suggest that CIFA violated the Antideficiency Act. Although CIFA and GovWorks entered into an agreement to obtain office space through a third-party lease without requisite authority, CIFA does have an appropriation that is otherwise available for the purpose of leasing office space--the Operation and Maintenance, Defense-wide appropriation. CIFA recorded these costs as obligations of this appropriation and transferred funds to GovWorks to pay for them. There is no indication, however, that CIFA recorded or transferred amounts in excess of or in advance of the appropriation. The conclusion that neither CIFA nor GovWorks violated the Antideficiency Act does not diminish or excuse CIFA's and GovWorks's disregard of federal statutes and policy, involving the government in an unauthorized transaction and millions of dollars of improper payments. View Decision B-309181, Interagency Agreements--Use of an Interagency Agreement between the Counterintelligence Field Activity, Department of Defense, and GovWorks to Obtain Office Space, August 17, 2007 Decision Matter of: Interagency Agreements—Use of an Interagency Agreement between the Counterintelligence Field Activity, Department of Defense, and GovWorks to Obtain Office Space File: B-309181 Date: August 17, 2007 DIGEST Without a delegation from the General Services Administration or independent statutory authority to enter into a lease, neither GovWorks (a Department of the Interior franchise fund) nor the Counterintelligence Field Activity (CIFA) of the Department of Defense (DOD) had authority to obtain office space through a third-party lease. Unless ratified by an appropriate government official, the agreement for office space is unenforceable against the government. GovWorks and CIFA cannot circumvent federal statutory and regulatory requirements on leasing by bundling the lease agreement in a contract for services. Without ratification, all payments made under this third-party lease are improper payments, and DOD and GovWorks should take appropriate action to resolve them. There is no evidence to suggest that CIFA violated the Antideficiency Act. Although CIFA and GovWorks entered into an agreement to obtain office space through a third-party lease without requisite authority, CIFA does have an appropriation that is otherwise available for the purpose of leasing office space—the Operation and Maintenance, Defense-wide appropriation. CIFA recorded these costs as obligations of this appropriation and transferred funds to GovWorks to pay for them. There is no indication, however, that CIFA recorded or transferred amounts in excess of or in advance of the appropriation. The conclusion that neither CIFA nor GovWorks violated the Antideficiency Act does not diminish or excuse CIFA's and GovWorks's disregard of federal statutes and policy, involving the government in an unauthorized transaction and millions of dollars of improper payments. DECISION The Inspector General (IG) for the Department of the Interior requests our decision under 31 U.S.C. sect. 3529 regarding a transaction involving the Department of Defense's (DOD) Counterintelligence Field Activity (CIFA) and GovWorks, a Department of the Interior (Interior) franchise fund, for acquisition of space to consolidate CIFA's activities.[1] The IG asked whether either CIFA or GovWorks had the authority to obtain office space to consolidate CIFA's activities, and, if not, whether CIFA and/or GovWorks violated the Antideficiency Act, 31 U.S.C. sect. 1341. For the reasons stated below, we conclude that neither CIFA nor GovWorks had independent authority to obtain office space.[2] CIFA desired additional office space, identified the desired space, negotiated terms for the space, and then directed GovWorks to sign a contract with the third party that included all the terms of the lease. GovWorks was acting as CIFA's agent in entering into the contract.