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Chapter 07D – Guidelines to Avoid Augmenting an Appropriation

Volume II - Appropriations Funds and Related Information

Date Approved: August 10, 2023

Financial Documents

Volume II - Appropriations Funds and Related Information

Chapter 07D – Guidelines to Avoid Augmenting an Appropriation

Questions concerning this policy chapter should be directed to:

0701 Overview

This chapter establishes the Department of Veterans Affairs’ (VA) financial policies regarding guidelines to avoid augmenting an appropriation.

Key points covered in this chapter:

  • VA will abide by appropriation laws and related statutes and will not circumvent spending limitations by augmenting its appropriations;
  • VA will only utilize appropriated funds for the program/objects authorized by the appropriation;
  • VA will obligate and expend funds only after they are apportioned by the Office of Management and Budget (OMB);
  • VA will deposit any funds it receives from outside sources to the appropriate Treasury General Fund Receipt Account (GFRA) unless the receipt constitutes an authorized repayment/refund to an unexpired fund or VA has the statutory authority to retain the funds; and
  • VA will not presume the receipt or distribution of funds is proper on the basis that there is no prohibition by Congress.

0702 Revisions

See changelog.

0703 Definitions

Antideficiency Act (ADA) – Federal law that prohibits the making of expenditures or the incurring of obligations in advance of an appropriation; prohibits the incurring of obligations or the making of expenditures in excess of amounts available in appropriation or fund accounts unless specifically authorized by law (31 U.S.C. § 1341(a)); prohibits the acceptance of voluntary or personal services unless authorized by law (31 U.S.C. § 1342); requires the Office of Management and Budget (OMB), via delegation from the President, to apportion appropriated funds and other budgetary resources for all executive branch agencies (31 U.S.C. § 1512); requires a system of administrative controls within each agency (see 31 U.S.C. § 1514 for the administrative divisions established); prohibits incurring any obligation or making any expenditure in excess of an apportionment or reapportionment or in excess of other subdivisions established pursuant to sections 1513 and 1514 of title 31 of the United States Code (31 U.S.C. § 1517); and specifies penalties for deficiencies.

Appropriation – Provision of law enacted by Congress, not necessary in an appropriations act, authorizing the federal agency to incur obligations and make payments out of the General Fund of the United States Government for specific purposes.

Augmentation of an Appropriation – An unauthorized increase in the amount of authority given to federal agencies to incur obligations and to make payments from Treasury funds.

General Fund Receipt Account (GFRA) – A receipt account credited with funds from collections that are not earmarked by law for another account for a specific purpose. These collections are presented in the Budget of the United States Government as either governmental (budget) receipts or offsetting receipts. See Volume II, Chapter 2D, for information on VA’s GFRAs.

Interdepartmental Waiver Doctrine (IWD) – A concept that property of the various agencies is not the property of separate entities but rather of the U.S. Government as a single entity, and there can be no reimbursement by the U.S. Government for damages to or loss of its own property.

Liquidated Damages – A specific amount of money stipulated in advance by the contracting parties as the measure of damages for certain breaches of the contract, such as failure to meet applicable performance deadlines. Liquidated damages must not be intended to punish, must be intentionally referenced in a given contract, and must apply to anticipated future damages that would be unquantifiable at the time of contract.

Refund – A return of funds previously disbursed.

0704 Roles and Responsibilities

Under Secretaries, Assistant Secretaries, Other Key Officials, and Chief Financial Officers are responsible for ensuring compliance with the policies set for in this chapter and that funds are used only for the purposes authorized by Congress.

Office of General Counsel (OGC) is responsible for providing legal advice to safeguard VA against committing or being involved in an unauthorized augmentation of agency funds, to include advising whether an augmentation is allowable based upon statutory authority (such as provisions in Appropriations Acts or title 38, United States Code).

0705 Policies

070501 General Policies

  1. Congress establishes maximum spending levels for federal programs by appropriating funds. Spending beyond the appropriated level without statutory authorization is a violation of the Antideficiency Act (ADA).
  2. VA will avoid augmenting an appropriation without appropriate statutory authority. The concept of prohibiting the augmentation of appropriated funds is derived from several statutes and GAO opinions as discussed in Principles of Federal Appropriation Law, Volume II, Chapter 6. The primary statutes include:
    1. The ADA, which prohibits federal agencies from obligating or expending federal funds in advance or in excess of an appropriation, and from accepting voluntary services (31 U.S.C. §§ 1341 and 1342).
    2. The “miscellaneous receipts” statute, which requires an agency to deposit monies it receives from outside sources to a Treasury GFRA unless it has the statutory authority to deposit the funds in current agency appropriations (31 U.S.C. § 3302(b)).
    3. The “purpose” statute, which restricts the use of appropriated funds to their intended purposes (31 U.S.C. § 1301(a)).
    4. The “anti-transfer” statute, which provides that an amount available under law may be withdrawn from one appropriation account and credited to another or to a working fund only when authorized by law (31 U.S.C. § 1532).
    5. 18 U.S.C. § 209 which, prohibits payment to Government officials or employees for their official duties from any source other than the U.S. Government.
  3. VA will ensure that appropriated funds will be utilized only for the program/objects for which the appropriation is made.
  4. VA will expend funds in accordance with the authorizing laws and appropriations from Congress, as apportioned by OMB and in accordance with VA Funds Control policy.
  5. OGC will provide legal advice to safeguard VA against committing, or being involved in, an unauthorized augmentation of agency funds.
  6. OGC will advise whether an augmentation is allowable based upon statutory authority (such as provisions in relevant Appropriations Acts or Title 38, United States Code).

070502 Receipt of Funds

  1. VA will credit amounts refunded to the appropriation initially charged with the related expenditure, regardless of whether the appropriation is in a current or expired status. Refunds of expired appropriation funds are not available for new or current-year obligations. If an appropriation account has been closed, in accordance with 31 U.S.C. §§ 1552(b) or 1555, the funds must be deposited as miscellaneous receipts into a GFRA (31 U.S.C. § 3302). See also Volume II, Chapter 7F – Refunds and Rebates.
  2. VA will deposit the fines or fees it receives from outside sources as soon as practicable to a GFRA or another Treasury account as guided by the “miscellaneous receipts” statute and related Treasury regulations, unless otherwise provided by law. The miscellaneous receipts requirement applies even when the appropriation is a no-year appropriation.
  3. Any refunded amount in excess of the original payment less cost of goods or services received must be deposited as miscellaneous receipts to a GFRA.
  4. VA will treat offsets the same as direct collections. If VA will retain a direct collection in a given situation, it will retain the offset; if VA will deposit a direct collection as a miscellaneous receipt, the offset will also be a miscellaneous receipt.
  5. See Volume II, Chapters 10, 10A and 10B, regarding collections authorized to sustain Revolving, Supply and Franchise Funds.
  6. Some of the statutory authorities that exist allowing VA to retain funds are listed below:
    • 31 U.S.C. §§ 1321-1323 – Trust funds and refunds;
    • 31 U.S.C. §§ 1535-1536 – Economy Act;
    • 38 U.S.C. § 1729A – VA Medical Care Collections Fund (MCCF);
    • 38 U.S.C. § 1971(e) – Veterans’ Benefits;
    • 38 U.S.C. § 1977(f) – Veterans’ Group Life Insurance;
    • 38 U.S.C. §§ 7804-5 – Veterans Canteen Service (VCS) revolving fund;
    • 38 U.S.C. § 8109 – Parking facilities;
    • 38 U.S.C. § 8121 – Revolving Supply Fund;
    • 38 U.S.C. § 8504 – Disposition of Other Unclaimed Property;
    • 40 U.S.C. § 586(c)(2) – Charges for space and services;
    • 42 U.S.C. § 8256 – Incentives for Agencies; and
    • 42 U.S.C. § 8287 – Authority to Enter into Contracts.
  7. VA will deposit monies received from external sources identified below as miscellaneous receipts:
    • Proceeds from the vending facilities in VA (Randolph-Sheppard Act);
    • An honorarium or other supplemental payment to a VA employee for VA official duties (18 U.S.C. § 209);
    • Fees collected from private individuals by VA employees for their services as notaries public;
    • Monies collected by VA as fines or penalties (19 U.S.C. § 527);
    • Transfer of excess property to another federal agency for Government use or disposition and proceeds from sale of excess property (40 U.S.C. § 571); and
    • Funds recovered by VA for damages to government property, which are unrelated to performance required by the contract.

070503 Collection from Contracts

  1. When VA receives a recovery from the original contractor for contract default or defective work, VA will retain the recovery amount to the extent necessary to:
    1. Fund the re-procurement or corrective measures, if VA has not yet incurred any additional expense; or
    2. Reimburse itself if VA has incurred some expenses for re-procurement or corrective measures.
  2. For certain breaches of contract, VA may receive liquidated damages from a contractor (e.g., liquidated damages received for a delay in performance).
  3. VA will not retain or use the liquidated damages to fund re-procurements that do not constitute “replacement contracts” for the contract that gave rise to the liquidated damages.
  4. VA will deposit the liquidated damages not used for replacement contracts to a GFRA as miscellaneous receipts.
  5. VA will credit refunds received under a warranty clause to the appropriation originally charged under the contract if they are deemed as adjustments in the contract price.
  6. VA will credit rebates or contract credits in the form of rebates, to its accounts when there is a statutory authority to do so or when they meet the criteria of a refund.
  7. VA will deposit recoveries paid under fraudulent contracts, to credit the appropriation initially charged with the payments, since these recoveries constitute refunds; however, if the appropriation account is closed, VA will deposit the funds in a GFRA.

070504 Collections for Loss or Damage to VA’s Property and Other Torts

  1. VA will deposit amounts recovered for loss or damage to VA’s property to GFRA unless specifically authorized by statutory or other legal authority.
  2. While a recovery may be related to the expenditure for property repairs, it does not constitute a refund in the form of an adjustment of a previous disbursement that would qualify for crediting to VA’s accounts.
  3. Recovery will include:
    1. Compensation paid by an insurance company for the damage to VA’s property, whether the payment is made to VA or the contractor; and
    2. The recovered amount from common carriers for VA’s property lost or damaged in transit.
  4. Recovery for loss or damage to the property of a VA revolving fund will be credited to the fund itself.
  5. In the event a private party damages VA’s property and agrees to replace the damaged property “in-kind” or pay for repair to VA’s satisfaction, there are no funds received by VA for deposit as miscellaneous receipts to a GFRA.
  6. VA will generally not bill another agency for damage to VA property in accordance with the Interdepartmental Waiver Doctrine (IWD).
  7. The IWD will not apply where VA has the statutory authority to retain income derived from the use or sale of certain property. The governing legislation shows an intent for the program/activity to be self-sustaining; thus, the program/activity is financed through reimbursements or a revolving fund. In such cases, VA will recover amounts sufficient to cover loss or damage to property financed by the reimbursements or revolving fund; regardless of whether that damage is caused by another federal agency or a private party, VA will deposit those funds into the revolving fund (38 U.S.C. § 8121).
  8. VA will deposit recovered amounts resulting from tortious injury to persons as miscellaneous receipts in a GFRA. However, the Federal Medical Care Recovery Act provides a statutory exception that VA will retain the recovery to the extent the collection or recovery is based on medical care or services furnished under chapter 17 of title 38, United States Code, and deposit it to VA Medical Care Collection Fund (38 U.S.C. § 1729A).

070505 Collections for Fees, Commissions, Setoff, Fines, and Penalties

  1. VA will deposit monies collected as fines or penalties to a GFRA as miscellaneous receipts.
  2. VA will not charge fees for services unless there is a specific statutory authority to do so, and VA will not presume that it is proper to charge a fee for service simply because there is no prohibition stated in the appropriation language.
  3. VA will deposit fees and commissions paid to VA or to VA’s employees for activities relating to official duties to GFRA under the miscellaneous receipts statute (31 U.S.C. § 3302(b)). However, with statutory authority, VA will retain the fees and credit them to the appropriations. The following document some examples:
    1. VA will treat jury duty and witness service fees, excluding court-identified expense reimbursements or allowances to the employees who provided the services, as deposits to the affected employee’s salary appropriation in accordance with 5 U.S.C. § 5515. See also Appendix A, Additional Guidance Regarding Jury and Witness Service Fees.
    2. VA will credit the appropriation charged for training expense for reimbursement of fees received for training state or local government employees in accordance with 42 U.S.C. § 4742 (a) and (b). However, VA will deposit the training fees it receives from private persons who attended its training programs as miscellaneous receipts unless VA has a statutory authority to the contrary.
    3. Volume II, Chapter 2E, Parking Facility Revenue, provides detailed policy to guide accounting for parking fees.
      • When General Services Administration (GSA) delegates authority to VA to operate, maintain or repair a parking facility under 40 U.S.C. § 121(d)(3), VA shall retain the portion of parking fees determined available under the delegation as no year funds until spent for an authorized purpose (40 U.S.C. § 586(c)(2)). Excess collections are deposited to a GFRA as miscellaneous receipts.
      • Specific to parking fees at a VA medical facility, VA will deposit this part of parking fees into the MCCF (revolving fund) in accordance with 38 U.S.C. §§ 8109 as amended, and 1729A.
    4. Income derived from the installation and operation of vending machines on Government-owned or controlled property is generally for deposit as miscellaneous receipts. VA’s Veterans Canteen Service operates most vending facilities at VA medical centers. The proceeds from the Randolph-Sheppard Act vending facilities in VA facilities are not VA’s monies (20 U.S.C. § 107).

070506 Gifts, Donations and Voluntary Services

  1. In general, an officer or employee of VA will not accept voluntary services for VA or employ services in excess of those authorized by law, except in cases of emergency involving the safety of human life or the protection of property (31 U.S.C. § 1342).
  2. 38 U.S.C. § 8301, authorizes the VA Secretary to accept gifts and donations for the benefit of Veterans or gifts that will enhance the Secretary’s ability to provide services or benefits. In accordance with gift acceptance delegation of authority and VHA Directive 4721:
    1. The VA Secretary delegated gift acceptance authority to Under Secretaries, Assistant Secretaries and Other Key Officials by memorandum copied in Appendix B.
    2. VHA employees who do not have authority to accept gifts should generally refer all questions of offers of gifts or donations to the VHA Center for Development and Civic Engagement (CDCE) to determine whether a gift can be accepted, by whom, and where.
    3. Gifts and donations can be monetary or non-monetary.
      1. Monetary gifts accepted under 38 U.S.C. § 8301 must be deposited to VA’s General Post Fund.
      2. Non-Monetary donations accruing to the General Post Fund will be liquidated in accordance with 38 C.F.R. § 12.22.
    4. OGC will review a willed donation or bequest, and donations setting conditions on use, to advise on acceptability.
    5. Donations over $20 million must receive Congressional approval. Donations may not be “unbundled” to defeat this limit.
    6. VA will not accept gifts or donations to acquire, construct, or alter VA medical facilities, including leased facilities under 38 U.S.C. § 8301 authority. Instead, the VA Secretary may accept them under 38 U.S.C. §§ 8103(a)(2) and 8104 with Congressional agreement.
  3. VA may accept certain gifts, donations, or bequests for the benefit of national cemeteries in accordance with 38 U.S.C. §§ 2406 and 2407.
  4. VA prohibits the acceptance of gifts or donations to pay the salary or expense of its employees because they constitute unauthorized augmentations, unless explicitly authorized by statute.
  5. VA may accept voluntary services in the following instances:
    1. Pursuant to 38 U.S.C. § 513, VA may accept uncompensated services for necessary services as the Secretary may consider practicable. 38 U.S.C. § 7405 provides further statutory authority to employ, without compensation, those persons listed in 38 U.S.C. § 7401(1) and (3).
    2. Under 5 U.S.C. § 3111, VA will accept volunteer services from students with the permission of the institution at which the student is enrolled as a part of an agency program established for the purpose of providing an educational experience for the student.
  6. A VA employee, as a traveler who received a promotional item as a result of using travel or transportation services obtained at VA expense, will be allowed to retain the item for personal use if the item is obtained under the same terms as those offered to the general public and at no additional cost to VA (41 C.F.R. § 301-53.2).
  7. Government employees will comply with ethical behavior guidance regarding personal gift acceptance in 5 C.F.R. Part 2635, consulting their supervisor or an OGC ethics official as warranted. See 5 C.F.R. § 2635.202 regarding the general prohibition on solicitation or acceptance of gifts.

0706 Authorities and References

0707 Rescissions

VA Financial Policy, Volume II, Appropriations, Funds, and Related Information, Chapter 7D – Guidelines to Avoid Augmenting an Appropriation dated February 2020.

0708 Policy Approval

This policy was approved by the VA Chief Financial Officer’s Council on August 10, 2023.

Appendix A: Additional Guidance Regarding Jury and Witness Service Fees

  1. An employee whose compensation and leave are protected by law from reduction on account of jury duty is prohibited from receiving compensation for such service in any court of the United States for any period of jury duty for which the employee would have been in a pay status in his or her Federal position (5 U.S.C. 5537).
    1. The prohibition against employees eligible for court leave receiving compensation for jury duty in addition to their regular compensation does not preclude allowing such employees to keep court-paid expenses, such as mileage payments, meals and lodging (20 Comp. Gen. 145, B-12134).
    2. An employee who is in a non-pay status (e.g., leave without pay) during a period of jury duty is entitled to keep the fees/salaries for each day’s attendance in court and for the time necessarily occupied in going to and from court (20 Comp. Gen. 276, B-13334).
    3. An employee who performs jury duty on a non-workday outside his or her regular tour of duty or on a holiday within the employee’s basic tour of duty (provided that, had the employee not been on jury duty, he/she would have been excused from regular duties on the holiday), is entitled to keep the fees/salaries for such service (37 Comp. Gen. 695, B-132027).
    4. An employee who performs jury duty outside of work hours so that no court leave is involved is entitled to keep jury fees/salaries (36 Comp. Gen. 378, B-129423). However, an employee who sits on a grand jury in the evening following a full day’s work and who is granted court leave the following day to relieve any hardship, is entitled only to keep a pro rata portion of the grand jury fee to the extent that hours of actual service exceed hours of court leave granted (B-70371-2, August 5, 1975).
    5. When jury duty overlaps normal work hours, an employee is entitled to keep a proportionate part of the jury fee or salaries for each hour of jury duty performed outside of the hours of duty the employee otherwise worked or would have been required to work. Any jury duty fees and salaries payable to the employee will be based on the statutory jury duty fee, prorated over a standard 8-hour workday, i.e., one-eighth of the statutory fee for each hour of jury duty outside of the hours the employee worked or would have worked but for the jury duty. If a presiding judge at his or her own discretion authorizes a retroactive increase in jury fees for jurors in cases extending beyond a 30-day duration, the actual fee paid will be the basis for computing the employee’s entitlement to compensation. In computing the excess hours of jury duty over the number of employee’s working hours in a day, fractional hours will be rounded off, one-half hour or more being considered 1 hour. When the end of an employee’s working day coincides with the beginning of jury duty, there is no necessity to prorate the fee. Any travel time between the duty station and the court is considered court leave (55 Comp. Gen. 1264, B-70371-1).
    6. An employee who is paid jury fees/salaries for periods of recess from a court and returns to and performs the regular duties of his or her position, is entitled to keep the jury fees/salaries received for the period of time that he or she was on duty. If the amount of jury fees or salaries received by an employee exceeds the amount the employee would otherwise have been paid in his or her Federal position for the period of court leave, the employee is entitled to keep the amount that is in excess of his or her Federal compensation (29 Comp. Gen. 302, B-86745, B-90858).
    7. Where a court provides a juror reimbursement of expenses at a fixed or varying rate, such monies are not considered jury fees or salaries. An employee is entitled to keep such monies as an expense allowance. Where an employee has inappropriately turned in expense money received from a court, he or she is entitled to a refund from the appropriation into which such monies were deposited (B-183711-1, October 6, 1976).
    8. An employee who is not eligible for court leave, such as an intermittent employee lacking a regular work schedule, may keep court compensation for jury duty, including fees/salaries (e.g., per diem allowance) for each day’s attendance in court.
  2. An employee who testifies on behalf of the United States or the Government of the District of Columbia is not paid witness fees, except that an employee on leave without pay for the entire period of witness service on behalf of the Federal Government may accept and retain witness fees (10 Comp. Gen. 329, A-34945).

Appendix B – Gift Acceptance Delegation of Authority

THE SECRETARY OF VETERANS AFFAIRS

WASHINGTON

September 10, 2005

MEMORANDUM FOR UNDER SECRETARIES, ASSISTANT SECRETARIES, AND OTHER KEY OFFICIALS

Subject: Renewal of Delegation of Authority for Acceptance of Gifts Under P.L. 102-86

  1. DELEGATION. I hereby delegate to the addressees authority to accept, for use in carrying out all laws, regulations, and VA policies administered by their organization, gifts, devises, and bequests which will enhance their organization’s ability to provide services or benefits. This delegation permits delegatees to accept and approve the use of gifts offered to VA entities under their cognizance without obtaining approval of the Secretary. This memorandum does not delegate authority to accept gifts covered by more specific authorities for accepting gifts.
  2. AUTHORITY DELEGATED. Only the authority to accept and approve the use of gifts, devises, and bequests in the last sentence of 38 USC § 8301 is delegated.
  3. RESTRICTIONS. When accepting and approving the use of gifts, devises, and bequests under this delegation, delegatees shall comply with all laws and regulations which govern the acceptance and use of such gifts. In addition, delegatees shall comply with the attached governing principles. Gifts for purposes covered by other, more specific gift acceptance statutes may be accepted under those statutes only.
  4. REDELEGATION. Delegatees may redelegate this authority to VA officials in their agencies or offices.
  5. EFFECTIVE DATE AND WAIVER OF TIME LIMIT. This delegation is effective upon signature of the Secretary. The two-year time limit generally applied to delegations is hereby waived for this delegation. It will remain in effect until rescinded.

R. James Nicholson

Attachment

5 USC § 4111 and 31 USC § 1353 (donations of non-Federal support for official travel), 38 USC § 521(b) (donations of assistance in providing recreational activities to veterans under section 521), 38 USC §§ 2406 & 2407 (donations for the benefit of national cemeteries), 38 USC §§ 8103(a)(2) or 8104(e) (donations for acquiring, constructing, or altering VA medical facilities), 38 USC § 7802 (donations for the benefit of Canteen Service), and the first sentence of 38 USC § 8301 (donations for the benefit of veterans who are patients and members of VA hospitals and homes).

DEPARTMENT OF VETERANS AFFAIRS

Governing Principles for Acceptance of Gifts Under the Last Sentence of 38 U.S.C. 8301

  • Gifts will be used for purposes that benefit veterans; this includes enhancing the delivery of services and benefits provided by the Department to veterans and their dependents.
  • Gifts will not be used to enrich employees. Where a benefit to employees results, it must be clearly incidental or secondary to the favorable impact on veterans and their dependents.
  • No gift will be accepted on condition of, or with the expectation of, the donor receiving a favor, endorsement, or other special treatment. This principle is not intended to prohibit suitable acknowledgements of gifts.
  • Gifts accepted with a commitment to use them as the donor specifies will be administered in fulfillment of the donor’s specified wishes.
  • Pecuniary gifts will be administered through the General Post Fund in accordance with its rules of accounting and disbursement.

APPROVED:

      /s/                                                                    9/10/05

R. James Nicholson                                                      Date

Secretary of Veterans Affairs

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