Navy appropriations are always prefaced by the number 17.125 The next digit or letter signifies the fiscal year or years in which the appropriation is available for obligation. If this digit is the number 9, for example, it signifies that the appropriation is available for obligation during the fiscal year ending in that number, or 1959. If this digit is followed by a slanted line, the appropriation is a multipleyear appropriation which is available for obligation in the fiscal year beginning with the year designated by the digit before the slanted line and ending in the fiscal year designated by the digit after the slanted line. Thus 8/9 would represent a multiple-year appropriation available for obligation during fiscal years 1958 and 1959. If the letter X follows the first two digits of the appropriation symbol, a no-year appropriation is indicated. The letter M designates a successor account to a lapsed appropriation.126 The remaining digits in the appropriation symbol designate the bureau or office to which the appropriation is assigned, as well as the particular appropriation head. Thus, in the appropriation symbol 1711803, the first two digits, 17, designate the Navy Department, the third digit, 1, designates the fiscal year 1951, the fourth and fifth digits, 18, designate the Bureau of Supplies and Accounts, and the last four digits, 1803, designate the appropriation "Service-Wide Supply and Finance."

C. Purposes for Which Available 120

20. Definition of the purpose of an appropriation. The purposes for which Navy appropriations are available are specified in the annual appropriation acts. To make doubly sure that these purposes will be observed, Congress has provided that:

Except as otherwise provided by law, sums appropriated for the various branches of expenditures in the public service shall be applied solely to the objects for which they are respectively made, and for no others.127

Accordingly, if appropriations are not used for the particular purposes designated by Congress, it is a fundamental rule that they cannot be used for any other purpose.128 The Comptroller General has said that, in the performance of his statutory function of settling and adjusting all accounts and claims in which the United States is concerned, he is not concerned with the apparent general merit of the proposed expenditure but rather with the question whether the Congress, controlling the purse, has authorized the expenditure.129 Fur

125 See 7 GAO Ch. 1000 (1958) for a full explanation of the symbolization of appropriation accounts. Other military appropriations are indicated as follows: Army, 21; Air Force, 57; and Department of Defense, 97.

123 For a discussion of successor or "M" accounts see par. 14 supra.

128 All principles in this Part C which are stated herein to be applicable to the Navy are equally applicable to the Army.

127 Rev. Stat. § 3678 (1875), 31 U.S.C. § 628 (1958).

128 21 OPS. ATT'Y. GEN. 414 (1896).

129 18 COMP. GEN. 285 (1938).

thermore, he has noted that the accounting officers have been as quick to question the administrative omission from contracts of provisions required by law to be included therein as they have been to question the inclusion of provisions not authorized by law and outside of appropriations. The principle involved, he stated, depends entirely "on the fundamental basis that it is for the Congress to say how and on what conditions public moneys shall be spent." 130 In order to determine the purposes for which an appropriation is made, reference must be had to the express language of the appropriation itself. Inclusion of an item or program in the budget justifications cannot enlarge the purpose of an appropriation established by the statutory language of the appropriation act.131 However, a long continued course of conduct by an agency under a particular appropriation, with the apparent knowledge and sanction of the Congress, may be sufficient to bring that practice within the purpose of the appropriation, even though it is not expressly provided for by the statutory language of the appropriation.

132

21. The performance budget. The Navy's appropriation act for the fiscal year 1951 was completely redrafted to conform to the performance-type budget structure called for by Title IV of the National Security Act of 1947, as amended.133 Title IV required the budget estimates of the Department of Defense to be prepared, presented and justified, and authorized programs administered, in such a manner as to account for and report the cost of performing readily identifiable functions and activities, with segregation of operating and capital programs. As reflected in the Navy's appropriation acts, all of the costs of maintaining and operating the fleet, for example, are grouped under the appropriation head, "Ships and Facilities." Likewise, the appropriations of the pay and allowances for the Navy and Marine Corps are stated separately for ready identification. Capital programs, such as those for the procurement of aircraft, ships, ordnance, and facilities of the Navy's shore establishment, are also carried in appropriations that are segregated from the so-called maintenance and operating appropriations. In this fashion the performance budget is intended to focus attention upon the general character and relative importance of the principal functions to be performed and services to be rendered rather than upon particular objects of expenditure unrelated to the use to which they are to be

130 Id. at 292.

131 26 COMP. GEN. 545 (1947); 18 id. 713 (1939). 182 See 18 COMP. GEN. 533, 535 (1938).

183403 of Title IV, as added by the Act of August 10, 1949, 63 Stat. 585, 5 U.S.C. 172 (b) (1958). This section, directing a change to the performance-type budget, establishes a new context for the application of REV. STAT. §. 3678 limiting the use of appropriations to the objects for which they are made. See par. 20 supra. In other words, REV. STAT. § 3678 should now be read as limiting the use of Navy appropriations to the functions for which they are made, except to the extent that a particular object is specifically provided for in an appropriation.

put. The most important aspect of such a budget structure is to show the work or services that are to be accomplished and what that work or services will cost.

Before 1951, the Navy appropriation acts enumerated many specific items of expenditure. These items were eliminated for the most part on the basis of decisions by the Comptroller General to the effect that where an appropriation is made for a particular object or function, by implication it confers authority to incur expenses which are necessary or incident to its execution.134 This rule assumes that there is no other more specific appropriation provision for such expenditures, and that such expenditures are not otherwise prohibited by law. The performance budget of the Navy treats primarily with functions rather than objects. Therefore, the test of the legal availability of an appropriation for a particular obligation is whether the function of the appropriation has been followed rather than whether the obligation has been related to particular objects or programs justified before the Appropriations Committees. This broad test depends in turn on the lump-sum nature of most of the Navy's appropriations, which do not specify the amount of the entire appropriation that may be used for each object thereunder. Therefore, the programs justified to the Appropriations Committee need not be followed if intervening events dictate such a course of action, but if they are not, Navy representatives keep in close touch with the Committees and inform them of each significant departure from the original program. This process is generally referred to as "reprogramming" 135

In the Navy's appropriation structure, then, examples of expenses which are considered to be authorized by implication include the following: supplies and materials; office and laboratory equipment; freight carrying vehicles; furniture and furnishings; tools and implements; repair and alterations; parts and accessories; utility services; communication services; and travel and subsistence expenses. In order to achieve uniformity in the budget structure in the three military departments, the Department of Defense has established eight major budget categories as follows: 135a

1. Military personnel costs

2. Maintenance and operation

3. Major procurement and production costs

184 29 COMP. GEN. 419 (1950), and cases cited.

135 Reprogramming may also involve departures from planned programs justified to the Armed Services Committees during the course of the consideration of authorizing legislation such as a military construction authorization bill. As in the case of reprogramming budget programs, Navy representatives keep the Committees closely informed of proposed changes. And, of course, to the extent that the authorizing legislation specifies the location, nature, cost, or other features of the program, reprogramming is thereby precluded. 135 Since this chapter was written, the major budget categories have been reduced to four: Personnel, Maintenance and Operation, Major Procurement, and Research and Development.

4. Acquisition and construction of real property
5. Civilian components

6. Research and development

7. Industrial mobilization

8. Establishment-wide activities

Of these categories, the first two cover annual recurring costs, while the third, fourth, and sixth categories require expenditures comparable to capital expenditures in industry. The segregation of these capital expenditures from the annual recurring cost of the military departments is, of course, one of the principal purposes behind the adoption of the performance budget.

22. The rules of statutory construction. To ascertain the purpose for which an appropriation is available the ordinary rules for statutory interpretation are applicable. In compliance with the rules of procedure of both Houses of Congress, legislation, as distinguished from the appropriation of funds for otherwise authorized programs, is not usually included in an appropriation bill.186 The authority for a Navy program, therefore, is generally expressed in an act other than an appropriation act. However, if Congress appropriates funds for an otherwise unauthorized program or purpose, the appropriation of money carries with it the authority to accomplish the program or purpose that is the subject of the appropriation, since an appropriation act is as authoritative as any other act of Congress which makes the law of the land.137

Even though the Navy's appropriation acts are based on the performance budget structure, with appropriations for functions rather than objects of expenditure, the language of a particular appropriation may make that appropriation available for a specific purpose, such as the charter and hire of vessels under the appropriation "Ships and Facilities." In such a case, other more general appropriations may not be used for this purpose. In the words of the Comptroller General, "an appropriation for a specific object is available for that object to the exclusion of a more general appropriation" which would otherwise be available for the same object; and "the exhaustion of the specific appropriation does not authorize charging the excess payments to the more general appropriation." 188 This rule is nothing more than an application of the familiar canon of statutory interpretation, expressio unius est exclusio alterius.139

Most of the Navy appropriations are lump-sum appropriations in which a rather large sum of money is made available for a mul

186 See par. 5 supra.

187 Syphax's Case, 7 Ct. Cl. 529 (1871). Any other result would necessarily make the appropriation provision meaningless.

139 19 COMP. GEN. 892, 893 (1940).

189 For discussion of this canon, see 2 SUTHERLAND, STATUTORY CONSTRUCTION §§ 49154917 (3d ed. 1943).

tiplicity of objects needed for the performance of a broad function such as the maintenance and operation of the fleet. Therefore, it may happen that either of two appropriations are available for objects not specifically mentioned under either. In such a case, the Comptroller General has said that he would not question the administrative determination as to which of the two appropriations should be used, but when the determination has been made, the continued use of the appropriation selected, to the exclusion of the other for the same purpose, will be required in the absence of any change in future appropriation acts.140 Of course, the administrative discretion in the use of appropriations may not go beyond the statutes nor may it be exercised for the accomplishment of purposes outside the scope of an appropriation.111

There is another consequence of the nature of a lump-sum appropriation concerning the effect of an overobligation on a contractor holding a contract thereunder. It is well established that in the case of a specific appropriation, that is, an appropriation made for a single purpose, a contractor is limited to the amount of money in the appropriation since he is held to have had notice of the limitations on the authority of government officials to bind the Government to pay more than the amount appropriated.142 However, if a lump-sum appropriation is involved, it has been held that a contractor is not chargeable with knowledge of the condition of the appropriation or its apportionment between him and other contractors.143 The exhaustion of such an appropriation, of course, would require a government officer to stop the contractor's work just as in the case of a specific appropriation. But if termination is not timely or if the appropriation is inadequate to pay the termination claim, it has been the practice of Congress to authorize the use of current applicable appropriations of the Navy to pay "claims certified by the Comptroller General to be otherwise due," in stated amounts, from specified exhausted appropriations.144

D. Project Orders, Economy Act Orders, and Transfers Between Appropriations 144

23. In general. It is essential to the control exercised by Congress over the purse that appropriations be used for the purposes for

140 23 COMP. GEN. 827 (1944).

141 18 COMP. GEN. 285 (1938).

142 Sutton v. United States, 256 U.S. 575 (1921). In this case, the Court limited the contractor's recovery to the amount specifically appropriated less the costs incurred by the Government in superintending the work, even though the contractor could not reasonably have been charged with notice of the amount of the latter costs. In reaching this result, the Court relied heavily on REV. STAT. §§ 3732 and 3733 (1875). See par. 10 supra.

143 Myerle v. United States, 33 Ct. Cl. 1 (1897); Dougherty v. United States, 18 Ct. Cl. 496 (1883).

144 See, for example, the Second Supplemental Appropriation Act, 1956, 70 Stat. 163. 144 All references to the Navy in this Part D are equally applicable to the Army.