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CHAPTER 4 - Utilization of Funds
Purpose
This chapter addresses the special policies and rules that apply to budget sources and object classes. These policies have been adopted to comply with sound fiscal management practices and to standardize the worldwide community of SAOs. SAO chiefs and budget officers must follow these policies unless appropriate authority has granted an exception. The unified command and DSCA are first in the chain of command to ascertain if exceptions have been granted and by whom for the SAOs.
General Policies
Request for Policy Clarification or Exceptions
Clarification as to policies contained in this handbook (or in the annual Defense Security Cooperation Agency (DSCA) budget call or any separate policy memoranda/messages), including requests for exceptions, should be forwarded by the Security Assistance Office (SAO) to the unified command comptroller's/funding resource manager's office. The unified command will screen and respond to inquiries where the policy is understood and the DSCA position is already known. Policy exception requests warranting further consideration will be referred by the unified command to the DSCA/Compt/RM for resolution.
Workload Distribution by Functional Area
The SAO, foreign military dales (FMS) and foreign military finance (FMF) administrative budget funds (collectively known as T-20 funds) should only be used for recognized SA-related functions. The SAO authorized staffing has used the workload distribution to develop the SA security assistance (SA) versus O&M portions of the joint manpower plan (JMP) for the SAO. Conversely, performance or support of missions beyond the scope of the defined SA-related functional areas must be financed from the appropriate benefiting appropriation. For example, non-SA missions that support the unified command (e.g., exercises and unified command logistics agreements offices (LAO), and other peacetime engagement activities) would be funded from O&M or other funds made available to the respective unified command.
Each SAO is required to submit as part of its budget data submission SAO workload data. The budget preparation module provides reports for DSCA and the unified command from this data. These reports show the percentage distribution of the organization's workload among SA and non-SA functions by fiscal year (FY). This data is used by DSCA to determine the amount of worldwide SAO funding which should come from each of the two SA sources cited previously. The data may also indicate whether or not Department of Defense (DoD) funds are required at particular SAOs based on the amount non-SA operational requirements (e.g., defense cooperation in armaments activity, ship visits, TCA, or other military-to-military activities).
Disposition of SA-Funded Equipment
Redistribution.
If an SAO is scheduled to close or downsize the SA mission or otherwise no longer has use for equipment in good condition, the SAO should contact the unified command to ascertain if the equipment should be redistributed to another SAO location.
Proceeds from Sale Disposal
If redistribution action to another T-20 account is not appropriate, and sale or transfer disposes of the SAO equipment, the proper fund cite must be shown when depositing the funds received. The proper funds cite is that of the funds monies that were used to finance the acquisition of the specific equipment item. These fund cites are:
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Military Assistance Program (MAP) -- financed equipment: use 11(?) 1082, where the "?" identifies the last number digit of the current fiscal year, e.g.,"1" for fiscal year 2001.
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FMS T-20 -- financed equipment: use 978242.0009 00 XQ? S843000. The symbols "XS?" are defined as:
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"X" denotes proceeds from the sale of surplus personal property.
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"Q" identifies DSCA as the implementing agency that issues the FMS administrative funds.
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"?" Identifies the FY: This symbol should be replaced with the last numeric digit of the fiscal year, i.e., 1 for FY01
Transfer of Trust Fund (T-20) Acquired Property to O & M Activities.
Property of an SAO that was acquired through T-20 funding may be transferred to O&M accounts when realignment of SAO functions occur because of changes in mission. Fair market value is the criteria for the transfer value, and proceeds should be returned to the trust fund. SAOs and unified command will coordinate with DSCA to determine if the gaining activity will be required to reimburse the trust fund for the equipment.
O&M and Other Appropriation Financed Equipment
Contact the unified command or executive agent for guidance for the procedures and proper fund cite.
Method of Funding
The SAO budget and budget execution is prepared and implemented based on how the obligation authority is distributed.
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Direct Charges are those object class requirements that will have the obligational authority provided to the SAO for budget execution.
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Indirect Charges are those requirements identified by the SAO in a separate portion of the budget preparation; the funding will be retained by DSCA and all bills will be paid by DSCA. The SAO still initiates action to fulfill these requirements, (e.g., security charges, C-12 operation, ICASS).
Specific Policies for Direct Costs
Automated Data Processing (ADP) Support
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Centralized Funding & Procurement
When feasible, DSCA will authorize centralized funding and procurement for ADP equipment when buys of sufficient quantity are required. This may include centralized buys for an individual unified command.
The unified commands will submit their ADP requirements with their budgets. DSCA/CIO will validate the requirements, and the appropriate activity will be directed to procure centrally those items when it is determined to be economically feasible to do so. DSCA will pass all others back to the unified commands for local purchase. Normally the central purchase will be limited to CPUs, and monitors (including the keyboard and mouse).
Minimum Specifications
Procurement of equipment and supplies to satisfy all microcomputer needs, including the needs of the Security Assistance Network (SAN), must adhere to the guidance in the Security Assistance Management Manual (SAMM), Section 1504 (as updated by any interim memorandum or message changes). A table in this SAMM section lists minimum equipment specifications when ordering additional or replacement automated data processing (ADP) equipment. Deviations must be coordinated through the unified command and approved by the DSCA process analysis integration division (DSCA/COMPT/PAID).
The unified command will determine the method of access to the internet that the SAOs will use. It may be a unified command system or a local Internet service provider (ISP).
Tempest Equipment
For SAOs located in selected embassy or other highly secure spaces, local policy may require the utilization of "tempest approved" equipment. Due to the increased cost, DSCA will normally only fund such equipment when its need is sufficiently justified, and it is a universal requirement for other offices on site. The SAO will utilize non- "tempest approved" equipment that complies with the minimum specifications in the SAMM, Section 1504, for all offices at an embassy where the "tempest approved" requirement does not apply.
Depreciation and Replacement
Funding for ADP equipment, operations, and maintenance shall be a routine part of the SAO budget process. ADP equipment replacements should be allocated among future budget years based on depreciation schedules. Expectations that all or the majority of the organization's ADP equipment can be replaced in a given year based on "fall-out" funds are unrealistic. SAOs should follow the depreciation schedule established by the DSCA/CIO. ADP equipment items will normally be depreciated on a three-year basis. However, equipment items should be retained longer if they are in good operating condition and compatible with existing SAN or other ADP computer programs or as directed by the unified command or DSCA.
Education of Dependents
Basic Guidance
Education of dependents is a "must-pay" requirement in the budget execution process. The unified command will issue guidelines on dependent tuition rates in conjunction with the budget call. The following general guidelines apply:
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Budget data will reflect only educational costs for dependents of SAO (T-20) funded billets and will not exceed the rates paid by Department of State for that location.
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Dormitory costs are allocable only for students who must attend school at a location other than their sponsor's assigned duty station.
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For non-DoD operated schools, SA funding support is limited to the Department of State Standardized Regulation (DSSR) allowance for dependent education at post rate for schools located within commuting distance of the sponsor's duty station or the "away from post rate" for dormitory schools. The DSSR "away from post rate" covers tuition costs, room and board, and three trips between the post and nearest foreign locality where an adequate school is available. Costs exceeding the DSSR rates will not be supplemented with SA operating costs.
Budgeting & Reporting Costs
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For DoD-operated schools, costs will be paid on a semester basis. Funds for the first semester will be budgeted for in the current FY (prior to 30 Sep). Funds for the second semester of the same school year will be charged to the subsequent FY.
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For non-DoD schools, costs will be paid on a semester basis unless the school requires a full-year or other tuition payment plan. If an alternative (other than semester) payment plan is used, budget for the FY funds when payment(s) is projected. Ensure the non-DoD school's written request for payment of full tuition or other variation from the equal semester payment plan is kept on file at the SAO.
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Transportation costs associated with transporting student(s) to and from school must be identified on the detailed portion of each year's budget format.
Dependent Education Travel.
Command-sponsored dependents attending high school away from the sponsor's duty station are entitled to three round trips per year to the sponsor's duty location (e.g., London Central High School students). Command-sponsored dependents that are authorized to attend high school or college in Continental United States (CONUS) are entitled to one round trip per year to the sponsor's duty location. This entitlement includes one 250-pound unaccompanied baggage allowance annually and CONUS storage costs of up to 350 pounds. (See Joint Travel Regulation, Chapter 7.)
Funded Environmental and Morale Leave
Funded Environmental and Morale Leave (FEML) Entitlement.
The FEML program authorizes transportation or reimbursement for such transportation to an authorized FEML destination from the SAO permanent duty site of the SAO military member and his command-sponsored dependents that are assigned to a FEML-authorized duty location. They are entitled to one trip during a two-year tour and two trips during a three-year tour. Generally, a member may not perform FEML travel within six months of the beginning or end of a tour. Dependents must be command-sponsored, but may travel unaccompanied by the SAO member. DoD civilians with a transportation agreement are authorized home leave in accordance with civilian personnel regulations.
FEML duty locations and destinations are recertified biennially by the unified command and approved by Office of the Secretary of Defense (OSD). The DoD Joint Federal Travel Regulations, Part S, identify the approved FEML countries and their designated destinations.
An SAO not currently authorized FEML may request its permanent duty location be designated as a FEML location by submitting appropriate justification through their unified command to OSD. DSCA is included in the coordination process for such requests during the OSD staffing process, since FEML transportation costs for SAO members are paid with SAO operating budget (T-20) funds.
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Space-Available (No Cost) Transportation. Space-available transportation at no cost to the government will be used if available. However, if unavailable, commercial air carriers are authorized if travel costs have been budgeted within the SAO's T-20 budget.
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Transportation Cost Limitation. Members and command-sponsored dependents may travel from the FEML duty location to other than the designated FEML destination and/or from other than the designated FEML destination to the FEML duty location. However, the total transportation cost to the government must not exceed the cost that would have been incurred if the member or dependents had traveled to and/or from the designated FEML destination, as appropriate.
Household Furnishings and Appliances
Household furnishings and appliances may be approved for purchase for use in SAO members' quarters when local conditions justify such purchases and for representational requirements for the SAO chief.
Housing -- Rental/Leases-OHA and Government Leased
Basic Policy. DSCA policy is to allow the unified command to determine whether government-leased housing or private leasing using the Overseas Housing Allowance is appropriate based on conditions in individual countries.
Government-Leased Housing (GLH). DSCA will support and fund GLH for SAO security assistance personnel when approved by the unified command. SAOs request GLH through their unified command. DSCA approval and SA funding for GLH can only support SA personnel. Leases for non-SA funded personnel assigned to SAOs must be approved/funded by the unified command.
All requests for new leases and for renewal of existing leases that exceed $25,000, to include utility costs, must be reviewed and approved by the unified command after review and approval by the Embassy Inter-Agency Housing Board. The SAO chief may approve lease replacements and lease renewals under $25,000 for SAO members provided that the embassy regional security office (RSO) and general services officer (GSO) concur with the terms, conditions, and location of the leased quarters.
The unified command must approve the chief's quarters and must have the RSO and GSO endorsement. If a waiver to the space standards is required, this, too, should be obtained from the Department of State before submitting a request for approval to the unified command. Funds for new replacement leases or renewals should be programmed in advance and included in the FY budget submissions. Additional new leases should be separately identified and justified as an unfunded request. Requests for lease replacements or renewals which exceed the $25,000 cost threshold should reach the unified command sufficiently in advance of the renewal or start date to provide adequate time for review and approval before signing the lease. Lease requests forwarded to the unified command should include the following information:
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Name, rank, and position of the individual
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Whether the individual is the U.S. defense representative
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Number of official dependents who will reside at post
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Number of official dependents who will reside away from post (dependents who reside at post less than 50% percent of the year)
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Rotation date
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Whether it is a new lease, replacement lease, or lease renewal
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Lease terms
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Description of property
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Address of property
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Net square footage of property
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Distance from normal work site
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Annual rent (in U.S. Dollars)
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Annual estimated utility costs (in U.S. Dollars)
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Annual estimated maintenance costs (in U.S. Dollars)
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Estimated move in/out cost
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Other associated lease costs not described above
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Whether the inter-agency board has approved
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Whether a waiver has been obtained from the Department of State on the space standards (If lease exceeds A-171 space standards)
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Whether the RSO has inspected and approved the property
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Security improvements needed/cost
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Whether the unified command approves of the lease
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Whether T-20 funds are available within the unified command/SAO budget to cover lease costs
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Justification
Each SAO should complete the applicable budget data to identify housing arrangements and total lease costs for authorized personnel.
Language Training
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SAO Personnel.
It is the Service's responsibility to assign language-qualified personnel to SAO duty as specified in the joint manpower plan (JMP). In 1990 DSCA developed the Tailored Training Approach to resolve the systemic problems associated with preparatory training for SA personnel. Furthermore, DSCA reviews all nominations for SAO chiefs. Unified commands should make sure the services assign only language-qualified personnel to SAO positions that require such expertise. Preparatory training for a SA assignment, when the individual must attend language school may take eighteen months or more. In these instances, replacements should be requested at least two years in advance.
There may be occasions when SAO personnel without appropriate language skills are assigned in country, and it is subsequently determined that language skills are necessary. In such instances, every effort should be made to obtain funding for language training from the applicable military department. Advance approval from both the unified command and DSCA is necessary before using SAO operating (T-20) funds for language training. However, T-20 funds may be used to purchase language-training materials for use by all SAO personnel for refresher training.
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Spouses
The SAO operating (T-20) funds may not be used to pay for language training of spouses. Spouses are encouraged to attend language training with their sponsor prior to arrival in country. Spouses may enroll in language training at the Defense Language Institute on a space-available basis. Upon arrival in country, spouses may attend language training offered by the embassy, if provided at no charge.
Property Authorization and Repair/Replacement
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Authorization.
Vehicles and equipment should be authorized on the joint table of allowances (JTA), the applicable Army common tables of allowance (CTA), the applicable Air Force Tables of Allowance (TA), or other approved documents, including unified command-approved authorizations. Although funds are requested in a budget object class (e.g., other equipment), this does not grant SAOs the authority to requisition or procure equipment items in the absence of the associated property authorization document.
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Consider Repairing before Replacing.
For vehicles and equipment items be replaced, the SAO must include a narrative statement (in the appropriate object class data) that includes the reasons for replacement and why it is not economically feasible to repair the items. For example, if an electrical appliance can have a motor replaced or if furniture can be re-upholstered or refinished locally, the motor or upholstery fabric and repair should be purchased locally instead of purchasing a complete end item.
Representational Funds
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General Guidance.
SAO representation funds will be used to maintain the standing and prestige of the United States by extending official courtesies to certain dignitaries and officials of the U.S. and foreign countries. The SAO chief may obligate representation funds only for official entertainment or other official purposes authorized in DoD Directive 7250.13, Official Representation Funds. Department of State Department guidance and policy on the use, accounting, and prohibitions for representation funds are in the Foreign Affairs Manual.
Exceptions must specifically be approved in advance by the-unified command and DSCA. All official entertainment must be in keeping with propriety as dictated by the occasion and, in all instances, must be conducted on a modest basis.
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Fund Limitations.
DSCA will issue target ceilings to each unified command, which cannot be exceeded. The unified command will issue target ceilings to the respective SAOs. These ceilings cannot be exceeded without advance approval of the unified command. These funds are limitations in law for representational purposes and may not be used for other requirements, nor can other T-20 funds be used by the SAO to increase the ceiling.
While DoD Directive 1100.12 establishes special command positions (four star/equivalent), which are entitled to amenities commensurate with the required level of official entertaining, including special allowances for table linens, china, etc, no SAO positions were included in this directive. Another reference is paragraph (a) of 10 U.S. Code 2387, which precludes the purchase of china, linens, kitchen utensils, etc.
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Budget Preparation.
The unified command total annual representation fund ceiling is identified in the approved AFP. This fund ceiling is issued by DSCA. Individual SAO representation fund ceilings issued by the unified command are part of the worldwide ceiling established by law. The unified command ceiling may not be exceeded without the express permission of DSCA. Funds for representation costs will be included in the operating budget request for each SAO.
Vehicles
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Armoring.
Vehicles requiring and armoring and other special security measures may only be procured from the DoS or/DoD-approved companies.
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Budget Planning.
DSCA is committed to providing adequate vehicle support; to include normal passenger and non-passenger vehicles, light armored vehicles, or heavy armored vehicles. Depending on the unified command, vehicle procurement can take from six months to two years.
Thus, SAOs should plan; program, and budget for vehicles through their annual budget requests at least two years out to take into account the long lead-times needed to receive vehicles.
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Depreciation.
SAOs should follow the depreciation schedule of the Executive Agent for each AOR, as modified by the unified command. In the absence of explicit depreciation guidance, the standard depreciation schedule for vehicles will be based on seven years or 90,000 miles. (See DoD 4500.36R.)
Procurement Policy
"Buy American" Acquisition Rules. As noted in AR 1-75/OPNAVINST 4900.31/AFR 400-45, SAOs must consider the following when purchasing or leasing a vehicle:
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SAO administrative funds will not be used to finance the purchase, sale, long-term lease, exchange, or guarantee of a sale of motor vehicles unless these vehicles are manufactured in the U.S. Requests, with full justification for exception to this policy for security reasons only, should be submitted through the unified command to DSCA for approval. This approval must be obtained prior to initiating any procurement actions.
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Armored vehicles will be purchased from approved sources only. Repairs to the armored parts of the vehicle will be performed only by authorized sources. Armored vehicles will be demilitarized prior to disposal. If demilitarization is not feasible (e.g., heavy armored vehicles), disposition of the vehicle must be accomplished through U.S. military channels.
Emergency Replacement.
When there is a requirement for an un-programmed replacement, (e.g. accident, theft, fire, etc.) the SAO will submit an unfunded requirement to the unified command if it cannot be funded from within the SAO budget.
Domicile-to-Duty Transportation (DTDT).
Only the unified command or higher authority can only authorize DTDT. The COM does not have this authority for SAO members. (See DoD 4500.36-R.)
Specific Policies for Indirect Costs
Aircraft (C-12) Flying Hours
General Guidance. As noted in the SAMM, Section 130304, dedicated C-12 aircraft have been assigned to selected countries. The primary mission of the dedicated C-12 aircraft is to support SAO program management. There is no legal basis to use SAO SA administrative (T-20) funds for C-12 flights for other than SA management purposes.
However, other missions may be flown when they do not have an adverse impact on the SA mission and when they are reimbursed. SAOs with C-12 aircraft must also abide by the policies in the aforementioned SAMM section.
Budget Preparation
The proposed current year and budget year flying hour programs must be justified by presenting detailed information in support of the total hours requested in the following four categories:
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Security Assistance Missions. Include those hours flown for SAO responsibilities as outlined in the following statutory sources:
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The Foreign Assistance Act (FAA) of 1961, as amended, Section 515, Overseas Management of Assistance and Sales Programs.
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The Arms Export Control Act (AECA), as amended -- normal administrative support related to sales of defense articles or services.
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Provide the number of flights by destination, flying hours, and purpose of the flight. Annotate flights requiring the aircraft to be flown out of the country.
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Maintenance. Include those hours, which are flown while the aircraft is in a maintenance status or flown round trip to obtain maintenance. An explanation should be provided to distinguish whether the hours are associated with routine maintenance or scheduled major maintenance.
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Training. This category should include instructor pilot training, proficiency training, or other flying training.
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Other missions (reimbursable). Other missions are those flown for non-SA activities and missions that provide support to personnel (TDY, mobile training team (MTT), Mobile education team (MET), technical assistance field team (TAFT)) whose transportation costs are funded by a specific FMS case. Examples of non-SA flights are disaster relief, exercises, visitors on non-SA business, and support of the U.S. embassy. Provide the same information for the number of flights, etc., as outlined above. Insure that the non-SA flying hours are separately identified in the Current Year and the Budget Year and are coordinated with the applicable organizations.
Flying Hours Reductions (Note for Unified Command):
Reductions to flying hours/costs may not be realigned to other cost categories in the budget development; a direct reduction to the total target level is required. Flying hours may be realigned among countries; however, an unfunded request may not be submitted for additional hours for a country where the unified command has reduced below the DSCA-approved level.
Antiterrorism/Force Protection
The Department of State is responsible for security of DoD personnel assigned to U.S. diplomatic missions abroad in accordance with the Omnibus Diplomatic Security and Antiterrorism Act of 1986 unless the unified command has assumed the responsibility through a Memorandum of Understanding signed by the ambassador (COM) and the commander-in-chiefs (CINC). Security equipment, including residential security upgrades, is considered a State Department funding responsibility. DSCA will work with the unified commands, SAOs, and State Department to provide the necessary funding to provide adequate protection for the SAOs in those instances where the State Department cannot provide funding. When funds are not available at the unified command, the request should be forwarded to DSCA.
Within the budget submission, the explanation for physical security upgrades should identify the item and whether it is for the office or a residence. This justification will include a statement from the region security office (RSO) that the upgrades are valid requirements. If local guard services are for other than residences, this must be explained.
Assistance-In-Kind (AIK)
Assistance-in-Kind (AIK), that is provided by the host country will be entered in the special exhibit section under the category AIK in the SAARMS budget preparation module. The data will be entered in the various object class entries in the same manner as for T-20. Estimates of cost for these services supplied by the host country should be based on what it would cost if the SAO had to budget for them from T-20 funds.
Consecutive Overseas Tour Leave
An SAO member and command-sponsored dependents that are entitled to consecutive overseas tour consecutive overseas tour (COT) or in-place consecutive overseas tour (IPCOT) leave will have their transportation and per diem funded as follows:
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For leave taken under the provisions of COT, service funds will be used whenever new permanent change of duty station (PCS) orders are issued, and the permanent change of duty station (PCS) is made
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For leave taken under the provisions of IPCOT, service funds should be used when the member stays at the current duty station and no PCS move occurs. To obtain the required fund cite, the SAO should submit a message to the unified command with the names of travelers and their relationship to the sponsor, dates of travel, estimated costs of transportation and per diem, and destination.
Emergency Evacuation
In those exceptional situations where emergency evacuation of dependents and sponsors are directed, state and/or the unified command will provide specific instructions.
Emergency Leave
Authorization for SAO Military Members. T-20 funded SAO military members and command-sponsored dependents granted emergency leave by the SAO Chief are authorized round-trip commercial transportation at T-20 expense, provided government transportation is not reasonably available to the Continental United States (CONUS), Alaska, Hawaii, Puerto Rico, or U.S. possessions per AR 1-75/OPNAVINST 4900.31/AFR 400-45. In accordance with the Joint Federal Travel Regulations, Volumes I and II, the cost of commercial transportation authorized will not exceed the cost of government-procured commercial air travel from the international airport nearest the location of the member upon notification of the emergency or the location of the SAO member's permanent duty station to the international airport in CONUS to which a scheduled flight is available that is closest to:
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The international airport from which the SAO member departed., or
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An airport in Alaska, Hawaii, Puerto Rico, a U.S. possession, or any other location outside of CONUS as determined by the service secretary, or designated representative, when authorized emergency leave.
There is no requirement to have a direct flight to the authorized airport, whether it is to the international airport nearest the location where the member was notified or to the international airport nearest the member's permanent duty station. Round trip transportation between overseas areas where there is an air mobility command (AMC) airlift service industrial fund (ASIF) is also authorized.
SAO U.S. Civilian Members and Dependents.
T-20 funded U.S. civilians and their dependents, when bona fide immediate family emergencies arise may use ASIF channel aircraft on a space-required basis. They will pay the transportation cost at the U.S. government rate tariff to AMC in accordance with AFR 76-11. These individuals also have an option to travel on a non-reimbursable, space-available basis on DoD-controlled aircraft (see DoD 4515.13-R, paragraph 4-5). Commercial travel in connection with emergency leave will be at the civilian member's expense for SAO members and their dependents. Travel at government expense is authorized when a civilian is in a TDY status.
Emergency Medical and Dental Care
SAO operating budget funds can be used to pay SAO member (military or civilian) or dependent transportation costs for emergency medical and dental care requiring immediate attention. Military members are also provided per diem allowances in accordance with the DoD Joint Federal Travel Regulations. FMS case funds should be used to pay for emergency medical and dental transportation costs for FMS case-funded personnel.
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Following certification of the emergency by the SAO chief, whose certification must be based on the determination by the local medical officer or U.S. embassy nurse.
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To pay for transportation to the nearest aeromedical evacuation center or to the nearest facility that can provide adequate care.
International Cooperative Administrative Support System
What It Is.
International cooperative administrative support system (ICASS) is a State Department of State system that provides administrative services to U.S. government offices located overseas, to include SAOs. ICASS services include civilian personnel management, communications, information systems, budget and fiscal, and general services. These services are provided on a reimbursable basis at the Washington D.C. level, and actual SAO charges are settled between DSCA and the Department of State with SAO input. See Chapter 6 for more information concerning ICASS.
SAO Mentorship.
All SAOs must carefully monitor their use of ICASS and ensure that the workload factors used by the embassy are accurate. SAO chiefs will ensure that the ICASS agreement and charges are reviewed annually to be sure that charges are reasonable. In this regard:
SAOs should reconcile cost differences between the Department of State Department's final ICASS bill and its local embassy's stated charges.
Preference for "direct charges".
Department of State and DoD continue to seek ways to improve the ICASS system so that the user (SAO) is directly charged for actual services received, rather than charged pro-rated (distributed) costs based upon a complex computer-generated formula. If the embassy applies direct charges for a service, the SAO should verify that a duplicate charge is not included in the ICASS allotment for this same service. SAOs should work closely through local ICASS councils in seeking cost-effective and quality service improvements.
Budget Preparation.
The current and budget year ICASS costs should be stated in prior year constant dollars.
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Special emphasis should be placed on ensuring that ICASS costs for O&M and FMS case-funded personnel are charged to separate ICASS agreements.
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Foreign Currency Expenditure Data
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Each SAO spending more than $30,000 in local currencies must report the dollar amount requiring conversion to the local currency are exempt.
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International Armaments Cooperative Programs
International Armaments Cooperative Programs (IACP) is a non-SA functional area. Unified commands should submit a consolidated budget summary, and country budget submissions identifying all the costs associated with those SAO joint manpower program (JMP) billets that are funded by service appropriations as IACP. IACP includes armaments cooperation (AC), defense cooperation in armaments (DCA), and defense industrial cooperation (DIC).
Medical/Dental Care (Non-Emergency)
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TRICARE. TRICARE provides funding for routine medical treatment for military members and their dependents.
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Service-Funded. Unified commands coordinate the delivery of routine medical/dental care, which is funded by the services. Funding for travel of routine U.S. patient care, such as required medical and physical examinations, is to be financed by the member's service, not by SAO operating (T-20) funds.
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Army and Air Force SAO Personnel. Army and Air Force SAO personnel and family members may be provided a fund cite from a centrally managed allotment. The unified command may provide this fund cite to SAOs annually in October; otherwise, contact the unified command as the need arises or in accordance with local instructions.
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Navy SAO Personnel. Medical travel funds for Navy SAO personnel and family members are limited and are handled on a case-by-case basis; fund cites should be requested by message to Field Support Activity, Washington DC, per the format in Figure 4-1. Medical travel accounting data and standard document numbers will be assigned by the Field Support Activity with the concurrence of the chief of Naval operations (N09BF) on an individual basis; SAOs must only use the travel order numbers assigned.
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Marine Corps SAO Personnel. Marine Corps SAO members will request fund cites by message to CMC Washington DC with an information copy to the unified command.
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SAO Civilian Personnel. Routine health care for U.S. SAO civilians is funded through their government health plan or at personal expense.
Morale, Welfare, and Recreation Costs
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Basic Funding Guidance. In accordance with AR 1-75/OPNAVINST 4900.31G/AFR 400-45, unified commands will establish MWR facilities and activities for their SAO and SA security assistance team personnel according to agreements with host nations. Morale, Welfare, and Recreation (MWR) activities will be financed with appropriated and non-appropriated funds of the service operating the activities in which SAO personnel participate.
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Physical Fitness Facilities/Equipment. SAOs without access to proper or adequate facilities for physical fitness training should request MWR funds from the executive agent to purchase equipment or membership in civilian health clubs.
Personal Services Contracts
DoD activities are precluded by law from entering into any contract that is of a personal services nature. Law, on the other hand, permits State Department of State to enter into personal service contracts. The SAO is a DoD activity that relies on the local embassy to perform contract officer functions on its behalf. The SAO chief must insure that no contracts of a personal service nature are initiated on the SAO's behalf. This includes contracts where the SAO could be included as a part of an embassy support contract.
Prior Year Obligations
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Scope Changes. DSCA will not authorize increases to prior year obligational authority to cover upward adjustments to existing obligations that are the result of "scope changes." Such upward obligation adjustments constitute "new obligations" and must be financed from current year authority. However, valid upward adjustments which are the result of "within scope" price adjustments under the terms of a contract are chargeable to the appropriate FY fiscal year account against which the original obligation was charged.
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Five-Year Period. Beginning with fiscal year 1995, SAO T-20 accounts remain available for liquidating valid prior year obligations until the end of their fifth expired year. In such circumstances, the SAO should cite obligation for the applicable prior fiscal year. (Example: at the start of FY01 on 1 October 2000, the current FY is 2001; the expired FYs are 2000, 1999, 1998, 1997, and 1996; and FY 1995 and prior years are closed.).
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Validation. The SAO should review and validate expired year unliquidated balances at least quarterly.
Any obligations determined to be no longer valid will be de-obligated and subsequently withdrawn by the unified command. De-obligation of prior year funds with subsequent re-obligation of the same funds is not permitted. Valid disbursements may be made from these accounts up to the amount of unliquidated obligation balances for that year, and they will be processed against that year's obligations. Additional funding to cover upward adjustments in obligations must be requested from DSCA via the unified command. In this regard, the following information must be provided: original obligation amount, additional required funding authority, and source/reason for the additional obligation. All other upward obligation adjustments are charged against the current fiscal year account.
Foreign Service National Separation Trust
Foreign Service national separation trust (FSN). Severance pay may be either a direct or indirect budget cost. Select countries are required to pay severance pay during the current year. In these situations the SAO will budget for severance pay as a direct cost. Obligations for the current year will be generated and payments recorded against them.
Those countries that manage severance pay as an indirect cost will include the requirement as and indirect cost in the budget submission. Each SAO will calculate the amount to be obligated each FY fiscal year and report that data as a memo entry in its budget submission. DSCA will consolidate the data and obligate funds centrally. Should a SAO require funds for separation pay during the year, the SAO will submit an unfinanced request through the unified command to DSCA.
Travel Guidelines
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Minimum Essential Travel for SAO Personnel. Consistent with the government-wide emphasis on reducing travel costs without having a negative impact on the accomplishment of critical mission objectives, official travel temporary duty -- (TDY) should be held to the minimum needed for essential program operations and accomplished at the lowest feasible costs. All proposed travel should be critically reviewed and prioritized by the unified command.
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Frequent Flyer Mileage Credits. The Federal Travel Regulations prohibit the use of frequent flyer benefits accumulated while traveling on official business for upgrade to first-class air accommodations. However, frequent flyer mileage credits may be used to upgrade to premium-class other than first-class. Under no circumstances may mileage credits earned during official travel be used for personal travel.
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First-Class Air Accommodations. First-class air accommodations may be authorized at government expense only when there is no reasonably available alternative, when exceptional security circumstances exist, or when the employee has a medically documented disability that makes first-class necessary to accommodate the employee's disability. The prohibition on first-class travel also applies when transportation expenses are accepted from a non-federal source under 31 U.S.C.1353.
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Use of the Miscellaneous Obligation Document (MOD). The security assistance automated resource management system (SAARMS) budget execution program includes the DFAS-approved MOD. This document is to be used to create obligations for requirements that are repetitive during the year. It allows the SAO to post various payments against it and to add additional authority during the year, while generating only one document number. Under no circumstances should the SAO use a MIPR to create T-20 obligations with the embassy.
Summary
Although the budgeting and expenditure of SAO operating (T-20) funds follow the basic rules associated with other U.S. government funds (e.g., O&M); there are some distinct and critical differences. It is imperative that T-20 funds be used only for expressly recognized security assistance-related functions. Accordingly, the SAO budget must accurately address its estimated workload by functional or benefiting area. There are special rules that must be adhered to relative to C-12 aircraft flying hours reporting, verification of ICASS, GLH, and the acquisition of vehicles and ADP equipment, to name a few areas warranting special attention.
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