The facility started from the ground, upward, with no resources in place. Orders for electrical wiring, flourscent lignting, small tools, etc. was placed in order to get the program into the crawl stage.
Problem: contracting will not approve wiring, flourscent lighting, and small tools insisting that RDT&E money is the wrong "COLOR" and Operation and Maintaince funds should be used. The facility also needs a bandsaw, pneumatic drills, etc. Contracting will not place these on contract citing that we are using the wrong color of money.
Question: Where in the Financial management Reguslations (FMR) DoD 7000/1R can I search to find the rules for usage of RDT&E funds?
The appropriate DoD Financial Management Regulation (FMR) (DoDFMR 7000.14-R) reference is Volume 2A, Chapter 1 (link: http://comptroller.defense.gov/fmr/02a/02a_01.pdf). This chapter provides guidance on requesting budget authority by appropriation type. Appropriate efforts to be budgeted in Research, Development, Test & Evaluation (RDT&E) appropriations are covered in section 010213 however you should read the prior sections as well to get the complete picture.
You should also review the budget justification material (R-forms) submitted to Congress describing what would be accomplished with the RDT&E funds you are attempting to use. This will probably require you to go to the source of the funding (whomever "sent you" the funds). If those R-forms describe acquiring this facility and Congress subsequently appropriated the budget authority based on that justification, then you can clearly show the RDT&E was appropriated for that purpose.
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