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The purpose of this document is to reduce the time spent in processing purchase requests by providing concise general legal guidance concerning "sensitive" purchases, and thereby reducing the need for individualized legal review of such purchases. As used in this document, the term "sensitive" is intended to encompass such items as food, floral displays, musical or other forms of entertainment, plaques, T-shirts with logos, balloons, imprinted pens, pencils, puzzles, and refrigerator magnets. Currently, these and similar items are referred to the Office of Chief Counsel for individual review.
General Rule. 31 U.S.C § 1301(a) provides that a Federal agency may only use appropriated funds for authorized purposes. If an agency's Appropriations or Authorization Acts do not specifically authorize an expenditure, the expenditure is proper only if (1) it is not prohibited and (2) it is reasonably necessary or incident to the proper execution of an authorized purpose or function of the agency. 66 Comp. Gen. 356, 359 (1987). Agencies have reasonable discretion to determine which expenses are "necessary" but GAO will review expenditures to determine if its relationship to an authorized purpose is so attenuated as to place it outside an agency's reasonable discretion. B-260260, 96-1 CPD ¶ 131 (Dec. 28, 1999). A substantial body of GAO decisions has developed concerning certain types of purchase. Two of these categories are applicable here. The GAO has consistently ruled that appropriated funds may not be spent for the entertainment of Government employees or others unless the expenditure is explicitly authorized by statute. 43 Comp. Gen. 305 (1963). Food and musical entertainment are among the types of expenditure that fall within this category. The GAO has also consistently held that items in the nature of personal gifts may not be purchased with appropriated funds unless there is a direct linkage to an authorized agency function. Id. A plaque, T-shirts, balloons, imprinted pens, pencils, puzzles and refrigerator magnets would fall within this category of generally prohibited expenditure.
nt to NASA's statutory mandate to disseminate information concerning its activities to the maximum practicable extent. If an expenditure falls within one of these two categories and if the purchase appears to be reasonable and is not lavish in nature, you may reasonably assume that it is proper. If it does not, the purchase should not be made unless you first obtain a legal review.
Award Ceremonies. The Government Employee's Incentive Awards Act (5 U.S.C. §§ 4501-4507) authorizes agencies to make awards to Government employees and to incur necessary expenses in connection with an incentive award. The award need not be in cash, and the GAO has specifically endorsed the purchase of such items as desk medallions, telephones of nominal value, $50 jackets bearing agency insignia for use as honor awards. USGAO, Principles of Federal Appropriations Law, at 4-137. Purchases of items for presentation at awards ceremonies should not normally require individualized legal review.
Agencies have reasonable discretion to determine what expenses incident to awards ceremonies are "necessary." Receptions, banquets, and luncheons at which food is served have been found to be appropriate expenditures. See, e.g., B-271511 (March 4, 1997). So are floral expenditures. B-247563.4 (Dec. 11, 1996). In short, any purchase of supplies or services for use at an awards ceremony which appears to bear a reasonable relationship to recognizing the accomplishments of Government employees need not have an individualized legal review.
Informational Activities. The GAO has noted that:
"[s]ome agencies have specific authority to disseminate information. Such authority will permit a broader range of activities and gives the agency discretion to choose the appropriate means, the selection being governed by the necessary expense doctrine."
Principles of Federal Appropriations Law, supra, at 4-187. NASA has such statutory authority - the Space Act requires the Administrator to "provide for the widest practicable and appropriate dissemination of information concerning its activities and the results thereof." 41 U.S.C. § 2473(a)(3). GAO decisions make it clear that agencies with such authority may use unconventional means provided they are reasonably related to the dissemination of information. In one often-cited case, the Department of Labor used a release of balloons at a parade to distribute mimeographed messages concerning employment services for veterans. Since the Department of Labor was statutorily required to publish information on its programs, the expenditure was proper. B-62501 (Jan. 7, 1947). In another relevant decision, the GAO approved the EPA's purchase of buttons and magnets containing slogans about the improvement of air quality for distribution at functions. 72 Comp. Gen. 73 (1992). The EPA was statutorily required to "increase awareness of the natural and built environment and to improve awareness of environmental problems." The GAO found that these non-utilitarian items "had no real purpose other than to convey a message" and were reasonably related to EPA's statutory duty to disseminate environmental information. In another case, GAO approved the Veteran's Administration's purchase of matchbooks and jar grip openers imprinted with a VA Center's telephone number which were distributed to the public at a item), conveys some message about NASA, and is non-utilitarian in nature and of purely nominal value, the expenditure is proper. If the item is utilitarian in nature, purchases should be limited to items of very nominal value (e.g., magnets, puzzles, and pencils). If the item is of more than nominal value, I would suggest that a legal review be obtained.
Procurement
