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  • Question

    Can we establish the CLIN and zero fund it without using an option for the CLIN? Could we establish the CLIN at initial award, fund with 3600 funds available at that time and there is no work performed on the CLIN for two years due to lack of GFP being available.


    Answer

    In the Principles of Appropriations Law (GAO Redbook), Vol. I Chapter 5 discusses the legal availability and time constraints of appropriations.  The language is clear that monies should be obligated only to satisfy the legitimate needs of the applicable fiscal year. Funds may not be obligated in advance of an appropriation. 
     
    The Bona Fide Needs Rule states "an appropriation should not be used for the purchase of an article not necessary for the use of a fiscal year in which ordered merely to use up such an appropriation".  Therefore , funds should be obligated only to meet a bona fide need in the fiscal year the appropriation was made. 
     
    This also applies to multiple year contracts, as stated in paragraph 2(b) "...multiple year appropriations are subject to the same principles applicable to annual  appropriations..."

    Based on the question involving 3600 RTDE funds, it would be a violation of the Bona Fide Needs Rule to "park" funds in a CLIN for use two years later. 

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