Anti-Deficiency Act | The Contracting Education Academy

October 27, 2016 By AMK

Whistleblower alleges culture of intimidation at DCAA

J. Kirk McGill was a Senior Auditor at the Defense Contract Audit Agency (DCAA), the agency responsible for auditing the Department of Defense’s (DoD) contract expenditures. He is also a whistleblower whose disclosures to Congress have resulted in multiple Congressional hearings, the termination of a nonprofit from grants worth over $400 million, and the closure of a loophole in contracting policy for nonprofit grantees.

Importantly, his case also sets a precedent for federal whistleblowers to engage in whistleblowing activities while on official time. None of this was easy, and it came—as is too often the case for whistleblowers—at a personal cost to McGill.

In 2013, McGill and his DCAA team were loaned out to the National Science Foundation’s (NSF) Inspector General (IG) to conduct a follow-up audit of the $433 million construction grant NSF had awarded for a project called the National Ecological Observatory Network (NEON). The project was not competitively bid, and despite an earlier DCAA audit finding serious problems with the initial proposal, NSF awarded it to a nonprofit organization called NEON, Inc.—a nonprofit focused solely on the project.

McGill, who was the Auditor-in-Charge, and his team found that NEON, Inc.’s accounting system was seriously flawed and lacked important supporting documentation. The audit also found poor budget controls that meant the project managers wouldn’t know if the program ran over budget—even tens of millions of dollars over budget—until it was too late to prevent. (The NSF later admitted that the project had run $80 million over budget.) As concerning as those numbers are, the audit also found that NEON, Inc. was abusing a $1.8 million category of funds called “management fees,” which were being used to pay for unallowable costs like alcohol, lobbying, and a lavish holiday party. McGill reported two instances of suspected fraud to the NSF IG through the normal channels. The IG investigated and referred the cases to the Department of Justice (DOJ) for potential prosecution, but DOJ declined to pursue them [p.3].

When McGill examined the requirements of reporting suspected fraud in an audit report, he found himself trapped.

Keep reading this article at: http://www.pogo.org/blog/2016/10/whistleblower-alleges-culture-of-intimidation-at-dcaa.html

April 15, 2014 By AMK

GAO issues annual anti-deficiency report

Each year, the Government Accountability Office (GAO) produces a report that identifies instances where federal agencies obligated or spent funds in advance or in excess of appropriate approval of funding. This reporting is conducted in accordance with the Antideficiency Act which prohibits such expenditures.

GAO’s summary of agency Antideficiency Act Reports for fiscal year 2013 includes unaudited information extracted from agency Antideficiency Act reports filed with GAO, as required by section 1401 of the Consolidated Appropriations Act, 2005, Pub. L. No. 108-447, 118 Stat. 2809, 3192 (Dec. 8, 2004). Each report entry includes a brief description of the violation, remedial actions taken, and links to individual agency reporting letters. For more information on individual violations and actions taken, contact the agencies filing the reports.

The latest report can be found here.

Per 31 U.S.C. §§ 1341, 1517(a), the Antideficiency Act prohibits federal agencies from obligating or expending federal funds in advance or in excess of an appropriation, apportionment, or certain administrative subdivisions of those funds. The act also prohibits agencies from accepting voluntary services (31 U.S.C. §§ 1342).

Specifically, the Antideficiency Act requires agencies violating its proscriptions to:

Report to the President and Congress all relevant facts and a statement of actions taken, and
Transmit a copy of each report to the Comptroller General on the same date the report is transmitted to the President and Congress.

GAO compiles and presents unaudited information from reports filed each fiscal year, including copies of the agency’s cover letters transmitting reports of violations.

October 14, 2013 By AMK

Under shutdown, a complicated picture emerges for contractor employees

With the start of the government’s first shutdown since 1996, every federal employee who’s not granted a specific exception is being placed on unpaid furlough starting today, for a total of about one million workers. But the picture’s a lot murkier for federal contract employees. Most of them will continue to do work for agencies during a shutdown, even if it’s not clear when their companies will be paid nor when the government employees with whom they share office space will return to work.

Trade associations who represent government contracting companies have been telling their members for the past several days that they need to stay in close contact with government contracting officers and project managers on each of the programs they’re involved in to determine whether work will go on during a shutdown, since the impact will vary dramatically case-by-case.

In the case of contract employees, the question is not so much about whether they’re essential to the protection of life and property — the biggest criteria used for most federal employees in furlough decisions — but rather, how and when the money that funds their contracts was obligated by the government. Since the shutdown is hitting at the beginning of a new fiscal year, it’s reasonable to expect that many, if not most, contract employees will actually continue working during a shutdown, depending on how long it lasts.

Keep reading this article at: http://www.federalnewsradio.com/index.php?nid=851&sid=3469048

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