Principles of Federal Appropriations Law - US Government ...

Chapter 4
Availability of Appropriations: Purpose
letter, GAO noted the principle that funds in the hands of a grantee largely
lose their identity as federal funds and said that the applicability of the
publicity and propaganda statute was therefore “questionable.” B-158371,
Nov. 11, 1977 (nondecision letter). A 1978 letter to a Member of the Senate
said that the issue should be addressed on a case-by-case basis. B-129874,
Aug. 15, 1978.
In B-128938, July 12, 1976, GAO said that an agency has a responsibility to
insure that its appropriations are not used to violate the anti-lobbying
statute. While the case involved expenditures by a contractor, the principle
would seemingly apply as well to a grantee.
Finally, in B-202975(1), Nov. 3, 1981, the Comptroller General resolved the
uncertainty, applied the concept of B-128938, and concluded that:
“Federal agencies and departments are responsible for
insuring that Federal funds made available to grantees are
not used contrary to [the publicity and propaganda]
restriction.”
The case involved the Los Angeles Downtown People Mover Authority, a
grantee of the Urban Mass Transportation Administration (UMTA),
Department of Transportation. Fearing that its funding was in jeopardy, the
Authority prepared and distributed a newsletter urging readers to write to
their elected representatives in Congress to support continued funding for
the People Mover project. The Comptroller General found that this
newsletter, to the extent it involved UMTA grant funds, violated the antilobbying
statute.
Similarly, in 1996, GAO determined that the state of Nevada improperly
used grant funds in violation of a broad provision found in the annual
Energy and Water Development appropriation acts prohibiting the use of
federal funds to influence legislation and other lobbying activities. 146 See
U.S. General Accounting Office, Nuclear Waste: Nevada’s Use of Nuclear
Waste Grant Funds, GAO/RCED-96-72 (Washington, D.C.: Mar. 20, 1996).
146 “[N]one of the funds herein appropriated may be used directly or indirectly to influence
legislative action on any matter pending before Congress or a State legislature or for any
lobbying activity as provided in section 1913 of title 18, United States Code.” Energy and
Water Development Appropriations Act, 1995, Pub. L. No. 103-316, 108 Stat. 1707, 1716
(Aug. 26, 1994).
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