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HHS Reference Tool for Contract Funding, Formation and Appropriations Law Compliance

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Overview

Regulations and
Guidance

Case Studies

Frequently Asked Questions

Disclaimer

HHS Reference Tool Content

I.Basic Appropriations Law Concepts
 A.Anti-Deficiency Act
 B.Bona FideNeeds Rule
 C.Appropriation Types
  1.Annual
  2.Multiple-Year
  3.No-Year
 D.Continuing Resolution
II.Decision Factors
 A.No-Year Appropriation
 B.Bona FideNeeds Rule
 C.Acquiring Severable Services
  1.Annual Appropriation
   a.Contract period not more than one year
   b.Contract period more than one year
    -Options
    -Incremental Funding
  2.Multiple-Year Appropriation
   a.Contract period will not extend beyond multiple-year appropriation's period of availability
   b.Contract period will extend beyond multiple-year appropriation's period of availability
    -Options
    -Incremental Funding
  3.Modifications
 D.Acquiring Non-severable Services
  1. Funded in Full
    a.Entire Contract/Single Requirement
    b.Fully Funded Initial Requirement (Followed by Options)
  2.Multi-year Contracting
  3.Options After Initial Requirement
    a.Severable Services
    -Annual Appropriation
    -Multiple-Year Appropriation
    b.Non-severable Services
    -Fully Funded
    -Multi-Year Contract
  4.Modifications
 E.Acquiring both severable and non-severable services
  1.Single Definitive Contract
  2.Indefinite-Delivery/Indefinite-Quantity Contract
III.Case Studies
IV.Frequently Asked Questions

Focus and Use of the Tool

This reference tool is intended to assist Department of Health and Human Services (HHS) staff members — program, budget/finance, contracting, and legal — in developing and interpreting contractual requirements, whether during initial formation and funding or when preparing and funding certain contract modifications. It will help HHS comply with federal appropriations law and pertinent Federal Acquisition Regulation (FAR) and HHS Acquisition Regulation (HHSAR) requirements by providing access to source documents and other resources.

The legal availability and use of federal appropriations is based on three core elements – purpose, time, and amount. This tool focuses on the principles of appropriations law related to the second element – time – because of vulnerabilities in this area. The other two core elements, while essential to establishing the legality of a particular obligation, are not addressed in this tool. However, HHS staff must take all necessary steps to comply with all three elements to ensure that contract obligations and expenditures are legally sufficient. Purpose and amount need to be addressed during acquisition planning, including consultation with the Office of the General Counsel (OGC), as appropriate, as those elements deserve equal attention to that given to "time".

Using the appropriations law concepts, decision factors (framed in a series of questions), and other utilities provided in this reference tool, a user can, in a given situation, assess how a contract action might be funded or whether a proposed course of action may be appropriate based on the nature of the requirement, its duration, and the type of appropriation involved. From the left navigation bar, the user may select basic appropriations law concepts or choose to navigate through the entire content of the decision factors. For example, the tool can help determine whether a proposed acquisition is for severable or non-severable services and then determine applicable requirements. The decision factors include "help notes" that explain key concepts, provide links to relevant Government Accountability Office (GAO) decisions, and are presented in a logical progression of questions to be asked when determining the available choices and compliant strategies for contract formation and funding. Alternatively, a user may access the left navigation bar to go directly to that part of the tool that relates to a specific need. For example, if a user knows that the services to be acquired are severable in nature and wants to find out whether such services can be incrementally funded, the user can go directly to the severable services portion of the decision factors.

Although by using this tool, a user can determine whether a proposed course of action would likely lead to a compliant outcome or may lead to a non-compliant result (i.e., an appropriations law or policy violation), this reference tool is not intended as a substitute for the business, budgetary, and legal judgment that must be applied when making decisions based on the facts and circumstances of a particular situation. For example, in cases where a particular course of action is problematic, the tool alerts the user that proceeding further may lead to an appropriations law or policy violation, in which case, OGC advice should be sought by the affected functional area(s) to help determine an appropriate course of action. If the tool indicates a potentially compliant outcome, if there is any doubt, based on the specific facts of the situation, OGC advice should be sought.

This reference tool does not address other areas of acquisition law, regulation, or policy that must be considered in developing an acquisition strategy, such as competition requirements and contract type, or post-award administration. These considerations are beyond the scope of this tool, although it should be noted that, as specified in this tool, HHS acquisition policy addresses aspects of funding applicable to specific contract types (e.g., cost-reimbursement).

This reference tool also contains 12 case studies and a set of frequently asked questions designed to illustrate the application of specific appropriations law-related principles to hypothetical contract formation and funding scenarios and questions. Both are accessible as topics on the main tool bar (which appears in the horizontal headings across the top of each page). Alternatively, the user may reach either of these categories of information by selecting item III., Case Studies, or item IV., Frequently Asked Questions, from the left navigation bar, and then may choose any of the individual case studies or FAQs based on the topic or question of interest. In addition, web tool coverage of certain topics in the decision factors, such as distinguishing severable and non-severable services, contains a link to a case study that is directly relevant to the concepts presented under that topic.

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