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



Regulations and

Case Studies

Frequently Asked Questions


HHS Reference Tool Content

I.Basic Appropriations Law Concepts
 A.Anti-Deficiency Act
 B.Bona FideNeeds Rule
 C.Appropriation Types
 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
    -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
    -Incremental Funding
 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
 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

Non-severable Services


Non-severable services constitute a specific, entire job or single undertaking with a defined end-product that cannot feasibly be subdivided for separate performance. Accordingly, non-severable services must be financed entirely out of the appropriation current at the time of award, even though performance may extend into future fiscal years. Following that logic, contracts for non-severable services cannot be incrementally funded (see 71 Comp Gen 428 (1992) and GAO Decision B-317139, Matter of Financial Crimes Enforcement Network).

Key Exception

The only means to award a contract for non-severable services without full funding up front is to use the multi-year contracting method per FAR Subpart 17.1.


A multi-year contract with two line items, covering: (1) a 5-year study, concluding in a final report documenting the research results; and (2) an option for a 3-year follow-up study of research participants, again concluding in a final report documenting study results.