HHS Reference Tool for Contract Funding, Formation and Appropriations Law Compliance
HHS Reference Tool Content
- I. Basic Appropriations Law Concepts
- II. Decision Factors
- A. No-Year Appropriation
- B. Bona Fide Needs Rule
- C. Acquiring Severable Services
- 1. Annual Appropriation
- 2. Multiple-Year Appropriation
- 3. Modifications
- D. Acquiring Non-severable Services
- 1. Funded in Full
- 2. Multi-year Contracting
- 3. Options After Initial Requirement
- 4. Modifications
- E. Acquiring both severable and non-severable services
- III. Case Studies
- IV. Frequently Asked Questions
The ADA (codified at 31 U.S.C. 1341 et seq.) prohibits Government agencies (and their officers or employees) from obligating the Government, by contract or otherwise, in excess of or in advance of appropriations, unless authorized by a specific statute. FAR 32.702,Policy, cautions Contracting Officers that ADA compliance is required whenever a contract action will involve funding.
Beyond the control at the appropriation level, the ADA (specifically, 31 USC 1517) also requires compliance with amount apportioned and allotted through the Departmental funds control regulations. While these requirements are part of the internal controls designed to ensure ADA compliance, this tool does not address the HHS budget allotment and allocation processes.
The ADA requires the heads of executive agencies to report ADA violations (through the Office of Management and Budget [OMB]) to the President and the Congress, with a copy to the Government Accountability Office (GAO). To comply with this requirement, HHS employees must report any suspected ADA violation immediately to the OPDIV or STAFFDIV Chief Financial Officer (CFO), who, in turn, will report the matter to the HHS Deputy CFO (Office of Finance within the Office of the Assistant Secretary for Financial Resources [ASFR]).