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    Because the RDT&E appropriation is a multi appropriation (2 Years) and according to the Bona Need Rule, FY12 dollars can be used for FY12 and FY13 requirements, does that rule apply to non-labor efforts, e.g., payroll? Can FY12 RDT&E dollars be used to pay for FY12 and FY13 salaries?


    According to DoD Financial Management Regulation, Volume 2A, Chapter 1, Section 010214, Subpart C, section 1.c., (link provided

    "While it is intended that the foregoing guidelines will be applicable to program execution as well as program formulation, there may be circumstances that could delay the start of an annual increment (such as legal, administrative, or technical problems). The 2-year availability of funds authorized for the Research, Development, Test and Evaluation appropriation provides the necessary flexibility for program execution in those circumstances."

    Incremental Funding policy states “annual estimates of initial financing needed for new major weapon systems and other development programs and projects requiring several years to complete, and which involve contracts spanning more than one year, should be formulated to cover costs expected to be incurred during each fiscal year.” 
    Annual Funding policy intends that we prepare annual budget request on basis of funding needed to operate and maintain DoD activities and pay personnel for a 12 month budget period (i. e., normally the fiscal year). 

    So, it is permissible based on the requirements of the Bona Fide Need Rule to use FY12 RDT&E funds for RDT&E costs in FY12 and FY13.  It could come down to the ones’ interpretation of costs of be expected to be incurred during each fiscal year and the WHY those costs slipped into the next fiscal year.  In most cases, payroll is rather predictable and tends to follow an annual funding policy vice an incremental funding policy.  While not necessarily a violation of federal law and/or DoD policy, Service comptrollers can be more restrictive in their interpretation of what is stated in the DoD FMR and hold an organization/unit to funding salaries applying an annual funding policy, just like you would using Operations and Maintenance funding. 

    Definitely suggest you seek Service specific guidance and restrictions regarding this interpretation as it can be MORE restrictive than what the DoD FMR states.

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