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    Can the Goverment accept a credit for the two months of service not delivered in Fiscal Year (FY) 2013, and have that amount applied against the renewal service invoice for FY' 14? Or, should a refund be requested?


    Answer

    To answer your specific question, “Can the Government accept a credit for the two months of service not delivered in Fiscal Year (FY) 2013, and have that amount applied against the renewal service invoice for FY' 14?  The short answer is no.  Making the assumption you are using O&M funds, available for obligation one year, to do so would violate the anti-deficiency act in that you would be paying for FY-14 services with FY-13 funds. Under the Bona Fide Needs Rule, agencies may obligate funds only for requirements that represent bona fide needs of the appropriation’s period of availability.  DOD Components shall determine that the goods, supplies, or services required under contracts entered into, or orders placed obligating an annual or multiple-year appropriation, are intended to meet a bona fide need of the period for which funds were appropriated. (DOD FMR vol. 3, ch. 8, para. 0808303A)
     
    However, you may be able to bilaterally modify the FY-13 contract Period of performance, extending it to include the lost time at no cost.  At the new date then begin the FY-14 POP, funding it with FY-14 funds.  Generally in service contracts, if performance begins in FY-13 the effort is funded with FY-13 funds and if the POP extends into the next FY it is OK to fund the effort to completion with FY-13 funds. 
     
    Additionally, if you decide to take back a credit or refund, keep in mind under the Miscellaneous Receipts Statute, an agency may not keep money it receives from sources other than congressional appropriations but must deposit it in the U.S. Treasury.  Keeping such funds would improperly “augment” the amount of the agency’s appropriated funds.  31 U.S.C. § 3302(b) (Miscellaneous Receipts Statute) states: “Except as [otherwise provided], an official or agent of the Government receiving money for the Government from any source shall deposit the money in the Treasury as soon as practicable without any deduction for any charge or claim.”
     
     


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