Company Commander Course- Fiscal Law Fiscal Law for the Company Commander & 1SG

Company Commander Course- Fiscal Law Why Does Fiscal Law Matter?

Company Commander Course- Fiscal Law Fiscal Law Provides the Rules that Allows Us to:  Train  Equip  Fight Our Nation’s Wars Why Does Fiscal Law Matter?

Company Commander Course- Fiscal Law Fiscal (Funding) Framework  U.S. Const. Art. II, § 2, cl. 1. “The President shall be the Commander in Chief of the Army and Navy of the United States....”  U.S. Const. Art. I, § 9, cl. 7. “No money shall be drawn from the Treasury, but in Consequence of Appropriations made by law....”

Company Commander Course- Fiscal Law “ The established rule is that the expenditure of public funds is proper only when authorized by Congress, not that public funds may be expended unless prohibited by Congress.” United States v. MacCollom, 426 U.S. 317 (1976)

Company Commander Course- Fiscal Law Fiscal Law is Different Congress has to say you can do it Just because Congress doesn’t prohibit it, doesn’t mean you can

Company Commander Course- Fiscal Law Fiscal Framework: Purpose U.S. Constitution Congress (Power of the Purse) TIME Bona Fide Need 31 U.S.C. 1552, 1344 AMOUNT Antideficiency Act 31 U.S.C , PURPOSE Necessary Expense 31 U.S.C. 1301(a)

Company Commander Course- Fiscal Law Purpose Statute Appropriations shall be applied only to the objects for which the appropriations were made except as otherwise provided by law. 31 U.S.C. 1301(a) 301

Company Commander Course- Fiscal Law How Congress Controls Funding  Appropriations Act  Department of Defense Appropriations Act (DODAA)  Authorization Act  National Defense Authorization Act (NDAA)  Statutes and Regulations

Company Commander Course- Fiscal Law Operations and Maintenance (O&M) Personnel RDT&E Military Construction Various Procurement 5 Pots of Money or “Appropriations”

Company Commander Course- Fiscal Law $30,934,550,000 Operation & Maintenance, Army FY12 Consolidated Appropriations Act- P.L

Company Commander Course- Fiscal Law Aircraft Procurement, Army Missile Procurement, Army Procurement of Weapons and Tracked Vehicles, Army Procurement of Ammunition, Army Other Procurement, Army (OPA) Army Procurement Pots

Company Commander Course- Fiscal Law Approved Expenditure?  Congress Expressly Approved; OR  Necessary Expense of Agency  Necessary and incident to an appropriation’s purpose, and  Not prohibited by law, and  Not otherwise provided for.

Company Commander Course- Fiscal Law  Is the expense necessary and incident to an appropriation’s purpose? Is it logically related to the appropriation’s purpose? Will it make a direct contribution to carrying out an authorized function? Necessary and Incident

Company Commander Course- Fiscal Law  Department of Defense Appropriations Act  National Defense Authorization Act  Various Statutes or Regulations Not Prohibited by Law

Company Commander Course- Fiscal Law  Example:  Purchasing an Optics for M-4  Procurement Weapons and Tracked Vehicles Includes purchase of accessories Not Otherwise Provided For

Company Commander Course- Fiscal Law Expenses: for all services, and/or certain supply items that are consumed in operating and maintaining DOD (last less than 2 years) Investments: for capital investment items that benefit both the current and future periods Construction: for the acquisition of temporary or permanent facilities, or a complete and useable improvement to an existing facility Classifying the Purchase

Company Commander Course- Fiscal Law  Investment Items Furniture IT Equipment  Expenses (O&M) Office Supplies Service Contracts Expenses vs. Investments

Company Commander Course- Fiscal Law Investment/Expense Threshold Expense items AND for investment items up to $250,000: Purchase with O&M appropriations Investment items whose cost exceeds $250,000: Purchase with Procurement appropriations Construction: Use O&M for costs up to $750,000

Company Commander Course- Fiscal Law Aggregate cost of systems Does it exceed $250,000 threshold Is it a System? What is the Primary Function? Intended to work together? Multiple Items and a “System”

Company Commander Course- Fiscal Law Questionable Expenses  Bottled Water - personal expense  Food - personal expense  Unless training  Clothing - personal expense  No unit funds for T-Shirts  Awards - okay, but no frames

Company Commander Course- Fiscal Law Fiscal Framework: Time U.S. Constitution Congress (Power of the Purse) TIME Bona Fide Need 31 U.S.C. 1552, 1344 AMOUNT Antideficiency Act 31 U.S.C , PURPOSE Necessary Expense 31 U.S.C. 1301(a)

Company Commander Course- Fiscal Law Period of Availability: Major DoD Appropriations O&M 1 Year MILPER 1 Year Procurement 3 Years RDT&E 2 Years Military Construction 5 Years

Company Commander Course- Fiscal Law Bona Fide Needs Rule Funds must be obligated during their period of availability, and the obligation must be for a “bona fide need” of that period. “Currents funds for current needs.”

Company Commander Course- Fiscal Law 1 OCT SEP 12 US Gov’t Fiscal Year Fiscal Year The US Governments Fiscal Year (FY) runsfrom 1 October to 30 September Example: Fiscal Year (FY) 2012

Company Commander Course- Fiscal Law Lifespan of Appropriated Funds ‘Current’‘Expired’Closed 5 years (All funds) Period of Availability (O&M- 1 Year) US Treasury For NEW obligations only!!! To adjust OLD obligations “Graveyard Dead” (Pays down the debt)

Company Commander Course- Fiscal Law Fiscal Framework: Amount U.S. Constitution Congress (Power of the Purse) TIME Bona Fide Need 31 U.S.C. 1552, 1344 AMOUNT Antideficiency Act 31 U.S.C , PURPOSE Necessary Expense 31 U.S.C. 1301(a)

Company Commander Course- Fiscal Law Amount  Congress prohibits  Obligation of more funds than you have been given  Obligation of funds in advanced of receiving them  Acceptance of “voluntary services’’  ‘Augmenting” of appropriations

Company Commander Course- Fiscal Law The Antideficiency Act  Purpose Statute  Lack Specific Authority/Satisfy Necessary Expense Test  Time Statute  Do not have a bona fide needs during the period of fund availability  Amount  Obligate more funds that given, or obligate funds before they are given, or augment your funding Agencies violate the ADA when they violate:

Company Commander Course- Fiscal Law Conclusion  Fiscal law is complex  Keep in mind PTA  Purpose  Time  Amount  If you have a good idea, talk to your legal advisor before you execute it