B-115398 COMPTROLLER GENERAL OF THE UNITED STATES July 9, 1975 Speaker of the House President of the Senate This letter reports a deferral of Department of Agriculture and Department of Interior budget authority which should have been, but was not, reported to the Congress as required by the Impoundment Control Act of 1974. H. J. Res. 499, making continuing appropriations for the fiscal year 1976 was signed by the President as Public Law 94-41 on June 27, 1975. This continuing resolution appropriated for the Youth Conservation Corps a rate for operations not in excess of the current rate ($10,240,000) plus an additional $10,000,000 which is to remain available through fiscal year 1977. One-half of the $20,240,000 thus appropriated is available to the Secretary of Agriculture and one-half is available to the Secretary of the Interior. Officials at OMB told us that they had not yet authorized the Youth Conservation Corps to spend the $10 million that the continuing resolution added to last year's rate of operations. We were told that an impoundment message involving these funds was being prepared for consideration by the President. Such a message, if approved by the President, is not expected to be submitted to the Congress until the latter part of July or possibly later. Since the Youth Conservation Corps is a summer program, the Congress may not be able to act in a timely manner on an impoundment message received so late. Such an event would effectively defer use of the funds until next summer. Section 1015 (a) of the Impoundment Control Act requires the Comptroller General to report to the Congress whenever he finds that the President, the Director of the Office of Management and Budget, the head of any department or agency of the United States or any other officer or employee of the United States has ordered, permitted, or approved the establishment of a reserve or deferral of budget authority and the President has failed to transmit a special message with respect to such reserve or deferral. This report is submitted in accordance with the requirement imposed by section 1015 (a) and, consequently has the same effect as if it were a deferral message transmitted by the President. Sincerely yours, Games B. Staats Comptroller General ACG-76-1 This letter reports the release of $10 million in impounded budget authority required to be made available for obligation by section 1013(b) of the Impoundment Control Act of 1974. On July 9 we reported the deferral of $10 million in Youth Conservation Corps budget authority that had not been reported by the President as required by the Impoundment Control Act. On July 10 the Senate disapproved this deferral, thereby requiring the Office of Management and Budget to make the $10 million available for obligation. We have confirmed that OMB has released this budget authority for use by the Youth Conservation Corps. Since the current youth employment program is well underway, $3 million has been released for use in this summer's employment program and $7 million has been designated for use in next summer's employment program. The agency expects the $3 million to fund about 4,000 youths and 800 supervisors for four weeks. Sincerely yours, Phillip & Anghe Philip S. Hughes ACG-76-3 B-115398 COMPTROLLER GENERAL OF THE UNITED STATES April 20, 1976 Speaker of the House This letter reports a rescission of Department of Housing and Urban Development (HUD) budget authority which should have been, but was not, reported to the Congress pursuant to the provisions of the Impoundment Control Act of 1974. Section 212 of the Housing and Community Development Act of 1974, P.L. 93-383, created an operating subsidy program for making payments to assist owners of section 236 projects in meeting higher operating costs resulting from increased property taxes and utility costs. The 1974 Act also provided that these payments be made from a reserve fund--Rental Housing Assistance Fund--that is comprised of excess rents paid by tenants residing in section 236 projects and interest earned by the fund. We have been informed by HUD officials that the Department does not intend to implement the operating subsidy program. As of March 31, 1976, the balance in the fund was approximately $44.6 million and HUD documents project that the balance will increase to approximately $48.7 million by the end of fiscal year 1977. HUD estimates that about $18 million from the fund will be used to compensate project owners for excess rent payments erroneously remitted to HUD prior to June 1975. This action, however, may not be implemented due to a recently initiated court suit in which the plaintiffs are seeking to enjoin HUD from making its planned remittances. In addition, HUD estimates that, for fiscal year 1976, another $300,000 will be needed to make court ordered payments under the operating subsidy program to those section 236 projects that are successful plaintiffs in lawsuits designed to require HUD to implement the program as regards those projects. HUD officials inform us that they have no plans to utilize any of the remaining $26.3 million, therefore, we believe that at a minimum, $26.3 million is being permanently withheld from obligation for operating subsidy ACG-76-23 B-115398 payments--even if HUD ultimately prevails in its plan to pay out $18 million--and constitutes an unreported rescission. We wish to point out that this message is unique in that it covers moneys which are also the subject of impoundment lawsuits in a number of United States District Courts. Most of the cases have not yet been resolved. Section 1015(a) of the Impoundment Control Act requires the Comptroller General to report to the Congress whenever he finds that the President, the Director of the Office of Management and Budget, the head of any department or agency of the United States or any other officer or employee of the United States has ordered, permitted, or approved the establishment of a reserve or deferral of budget authority and the President has failed to transmit a special message with respect to such reserve or deferral. This report is submitted in accordance with the requirement imposed by section 1015(a) and, consequently has the same effect as if it were a rescission message transmitted by the President. The statutory 45 calendar days of continuous congressional session that the Congress has to complete action on a rescission bill involving this budget authority will be based on the date that the Congress receives this report. On April 20. 1976. we notified the Congress of an unreported rescission proposal of Department of Housing and Urban Development (HUD) budget authority available for making operating subsidy payments under section 236 of the National Housing Act. This rescission should have been. but was not. reported by the President to the Congress pursuant to the provisions of the Impoundment Control Act of 1974. Subsequently, on July 7, 1976, we reported that. although the Congress had not acted favorably on the rescission proposal within the 45-day period prescribed by the Act and the budget authority was required to be made available for obligation. it had not been made available. Accordingly, our letter of July 7 notified the Congress of our intention to institute a civil action to require the release of the budget authority. The July 7 letter noted that a provision then under consideration for inclusion in the Department of Housing and Urban Development-Independent Agencies Appropriation Act for Fiscal Year 1977. if enacted, would authorize HUD to disperse the budget authority involved in this rescission to other housing programs. This provision was enacted in Pub. L. 94-378, August 9, 1976. Subsequently, we were told informally that HUD planned to release the funds to the housing payments account and to utilize the funds thereunder, thus terminating the impoundment. As was indicated in our prior letters to the Congress, a number of lawsuits have been initiated by individuals seeking to compel HUD's implementation of the operating subsidy program. In one of these cases. Underwood; et: al., v. Hills; Civil Action 76-0469, DCDC. a class action on behalf of all section 236 project tenants. the district court ordered, inter alia. HUD to make operating subsidy payments. OGC-77-9 |