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B-197274 1 (1982-02-16)

handle is hein.gao/gaobadkbk0001 and id is 1 raw text is: B, /75-1 OCISION PILUS s-197274 J0-C)7q VMS 0PYNCILLNGENNSAL op P VM UNAVS1D ElATES WASHINCTON, o O 80S DATE: February 16, 1982 MATTER OF: HID's Cbligating No-Year Contract Authority DIGEST: HM' s use of reservation and notification letters urer various housing assistance programs to determine when no-year contract authority was considered obligated for purpose of reporting to Congress was inappropriate since at the time of their :.ing issued, HUD had neither taken action imposing a legal liability upon the Government which would result in the expenditure of funds nor which could mature into a legal liability of the Govtriment by virtue of actions on the part of other parties beyond the control of the Government. Tbis decision to the Secretary of Housing and Urban Developnent (Secretary) is in response to a request that we provide a more defini- tive ruling on the use of reservation and notification letters for obligating contract authority under various federally assisted housing programs. This matter has previously been the subject of a report by this Office, D-197274, dated April 30, 1990, in which we stated that *notification and reservation letters are not legally sufficient to constitute obligations, and recommended to the Secretary that, among other things, HUD record obligations at a later time in the housing process. Ite Secretary, in his response to our report, took issue with our determination and requested a decision from this office on this matter. RM's positions on the various questions presented are taken from a letter with attachments dated March 28, 1980 frm Irving R. Margulies, Associate General Counsel, Finance and Aministrative Law Division, to Ir. Sidney Wolln, Group Director Procurement and Systems Acquisition Division of this Office and from a letter dated June 31. 1980, from the Secretary to Representative Jack Brooks, Chairman, of the House Oommittee on Government Operations We note that our criticisms of HUD at that time were based upon practices it followed in reporting to the Congress amounts of contract authority obligated during the fiscal year for the purpose of justifying requests for additional contract authority. Consequently, our analysis was based in prt upon the rules and regulations in effect at the end of the most recently completed fiscal year for which obligations were reported; that is, September 30, 1979. Since that time, however, numerous changes have taken place in the regulations governing same of these progrims.

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