Agency Discretion to Manage Appropriated Funds: The WHO Funding Announcement

Agency Discretion to Manage Appropriated Funds: The WHO Funding Announcement

Legal Sidebari

Agency Discretion to Manage Appropriated
Funds: The WHO Funding Announcement
May 15, 2020
On April 14, 2020, President Donald J. Trump announced that his Administration would “halt” funding to
the World Health Organization (WHO) while it investigates the WHO’s Coronavirus Disease 2019
(COVID-19) response effort. This “investigation,” the President stated, may last “60 to 90 days.” As
observed in CRS Insight IN11369, U.S. Funding to the World Health Organization (WHO), by Luisa
Blanchfield and Tiaji Salaam-Blyther, Congress has not appropriated funds specifically for the WHO in
recent appropriations acts. Instead, Congress has appropriated funds for executive branch agencies to
address topics such as international disaster and famine assistance, and the recipient agency may have
opted to obligate such funds for projects that involved the WHO. It is too early to tell how the Trump
Administration’s announcement might affect agency action, if at all. It is possible to construe the
Administration’s statements as signaling that agencies might proceed with obligating funds by working
with “different partners” instead of the WHO. But some observers have questioned whether agencies
might temporarily delay obligating funds pending the Administration’s investigation. Conceptually, these
two general possibilities—obligating funds or temporarily delaying obligation—raise questions about
agency discretion to manage appropriated funds.
This Sidebar provides a general discussion of an agency’s authority to obligate its appropriations or,
alternatively, temporarily delay the obligation of budget authority, noting, along the way, potentially
relevant considerations in the case of the WHO funding announcement.
Appropriations Law Concepts
The Appropriations Clause of the U.S. Constitution provides that “No Money shall be drawn from the
Treasury, but in Consequence of Appropriations made by Law.” An appropriation is a type of budget
authority, which is authority for an individual to incur an obligation on behalf of the United States. An
obligation includes a “definite commitment that creates a legal liability of the government for the
payment of goods and services ordered or received.” What sets an appropriation apart from other types of
budget authority (such as borrowing or contract authority) is that only an appropriation allows an agency
to both “incur obligations” and “make payments from the Treasury for specified purposes.”
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To withdraw funds from the Treasury, then, an agency must have an appropriation set forth in statute.
Congress provides appropriations in regular appropriations acts, supplemental appropriations acts, and
other statutes. Read in light of the general provisions that follow in the appropriations act and any relevant
provisions in other statutes, the language of each unnumbered paragraph of an appropriations act
identifies the purposes for which the budget authority provided in that paragraph may be obligated, the
amount of budget authority provided, the time period in which it is available, and any conditions imposed
on its availability.
In recent fiscal years, the U.S. Agency for International Development (USAID), the Department of State
(State Department), and the Department of Health and Human Services, among others, have used their
appropriations to support the WHO. In FY2016, FY2017, and FY2018 (the most recent years for which
data are publicly available), these agencies collectively used more than a dozen accounts to obligate funds
for WHO purposes. Congress granted these appropriations using varying language when describing the
purpose, amount, time period, and conditions attached to use of that authority.
Obligating Budget Authority
On the one hand, it is possible to construe Trump Administration statements during and following the
WHO funding announcement as signaling that agencies might proceed with obligating funds by working
with “different partners” instead of the WHO. Agency discretion to obligate such budget authority is
controlled by statute and case law.
Key Concepts
Congress has directed that “[a]ppropriations shall be applied only to the objects for which the
appropriations were made except as otherwise provided by law.” Courts and the Government
Accountability Office (GAO) interpret an appropriation to grant an agency not just the authority to
obligate funds for the activities or programs stated in the appropriation, but also for expenses necessary to
accomplish the appropriation’s stated objects. Using the “necessary expense test,” which is a “rule of
construction for appropriations statutes,” an agency may use a particular appropriation for an expense if,
among other things, (1) there is a logical relationship between the expense and the appropriation; (2) the
expense is not prohibited by law; and (3) no other appropriation more specifically provides for the
expense.
Thus, an appropriation usually “encompasses a number of activities or projects.” The text of the
appropriation and any other relevant statutes determine the extent of an agency’s discretion to decide
which portions of the budget authority provided in a single appropriation should go to one particular
activity or project over another. When Congress does not specify in statute the amount available for a
particular activity, project, or recipient, courts view Congress as having delegated that allocation choice to
the agency. By leaving it up to the agency, Congress gives the “agency the capacity to adapt to changing
circumstances and meet its statutory responsibilities in what it sees as the most effective or desirable
way.”
Congress has multiple means for limiting an agency’s allocation discretion. First, Congress may limit the
agency’s discretion by setting aside, in statute, some portion of the appropriation for a particular activity,
project, or recipient. For example, Congress might specify in the text of an appropriation that an agency
may dedicate “not less than” a specified amount to a particular use. If Congress uses this language or its
legal equivalent, it specifies “a minimum for the particular object.” Second, according to GAO, a
committee report or explanatory statement may, under certain circumstances, dictate how an agency is to
allocate a particular appropriation. On its own, a committee report or explanatory statement does not
“establish any legal requirements” on an agency regarding funds allocation. However, GAO has opined
that when such committee report directives are expressly incorporated into a statute so that the agency and

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others can look to the incorporated material to “ascertain with certainty the amounts and purposes for
which . . . appropriations are available,” the committee report allocations bind the agency.
Thus, an agency’s allocation decision is proper if it “meet[s] permissible statutory objectives” and
comports with any provisions of statute designating funds for particular objects. At least one other type of
statutory provision may affect how an agency sets funding priorities: reprogramming notice provisions.
Each year, the President submits a budget to Congress and agencies likewise submit justification
materials. These materials may describe the programs, projects, or activities that comprise each requested
appropriation so that Congress has “a meaningful representation of the operations financed by a specific”
appropriation. A committee report that accompanies an appropriations act might also specify how the
committee expects the agency will divide the budget authority made available in a given appropriation
(though not necessarily in a manner that meets GAO’s express-incorporation test). An agency reprograms
when it shifts funds within an appropriation account to obligate more or less budget authority for a given
program, project, or activity than was contemplated in the agency’s justification materials, a committee
report, or other relevant reference document.
Congress typically monitors reprogramming through reprogramming notice provisions. Congress phrases
such provisions as setting conditions that an agency must satisfy before budget authority is available for a
reprogramming. Such provisions may state that “[n]one of the funds made available” by all or part of the
appropriations act “shall be available for obligation” “unless” the agency notifies certain committees “in
advance of such reprogramming of funds.” An agency may not obligate budget authority without
providing the required notice because without the notice, no funds are “legally available for obligation.”
Potential Considerations for the WHO Funding Announcement
For those agencies that have funded WHO programs in the past, the general framework discussed above
helps describe discretion to obligate budget authority to work with “different partners” instead of the
WHO. Of course, the text of the relevant appropriation is key for defining the range of an agency’s
discretion to obligate funds available in that appropriation. To take an example of one possible source of
funding, USAID’s Global Health Programs (GHP) appropriation is available for “necessary expenses to
carry out the provisions of chapters 1 and 10 of part I of the Foreign Assistance Act of 1961, for global
health activities.” Those portions of the Foreign Assistance Act, in turn, authorize assistance to combat
HIV/AIDs, tuberculosis, and malaria, to name a few permitted activities. Other appropriations, used in
past fiscal years to support WHO programs, use different language to describe available budget authority
and are subject to different conditions.
When setting this range of agency discretion (which differs appropriation to appropriation), Congress did
not choose to use either of the two means mentioned above to designate funds for the WHO. Congress did
not set aside, in statute, any portion of budget authority for WHO projects. And though, in certain
appropriations acts, Congress incorporated by reference explanatory statement allocation tables, these
tables do not appear to require that any particular amount of budget authority be made available for the
WHO, but instead speak in more general terms. For instance, the tables allocate funds within the GHP
appropriation to such programs as “Maternal and Child Health” and “Nutrition.”
Finally, Congress decided to monitor, subject to waiver, reprogramming of foreign assistance funds using
statutory notice requirements. Whether any particular use of funds constitutes reprogramming, though,
will depend on the programs and appropriation at issue as well as how the agency justified that
appropriation and any relevant provisions of committee reports. Even if proposed action would be a
reprogramming, that fact alone does not require notice to relevant committees. For example, for the GHP
appropriation notice is not required if a reprogramming would be an increase of “less than 10 percent of
the amount previously justified to Congress.” Different appropriations may be subject to different notice
requirements.

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Delaying Use of Budget Authority
On the other hand, as noted above, some observers have questioned whether agencies might temporarily
delay obligating funds pending the Trump Administration’s “investigation” into WHO matters.
Key Concepts
Congress monitors and responds to agency delay in making funds available for obligation under the
Impoundment Control Act of 1974 (ICA). According to GAO, the ICA operates “on the premise that
when Congress appropriates money to the executive branch, the President is required to obligate the
funds.” But the ICA also provides “mechanism[s],” subject to congressional notice, for the executive
branch to “deviate from this requirement.”
When an agency impounds, it acts or fails to act in a way that precludes budget authority from being
obligated or expended. When identifying an impoundment, the question is whether an agency intends “to
refrain from obligating or expending available budget authority, based on the facts and circumstances
present.”
The ICA permits two budget actions that may temporarily delay budget authority from being available for
obligation, provided Congress receives the required notice of the action.
 First, the President may send a special message to Congress proposing that Congress
rescind, or cancel, budget authority. Once the President sends the special message, the

affected budget authority may be withheld from obligation for 45 legislative days
(equivalent to 45 calendar days, given Congress’s current practice of holding pro forma
sessions). If Congress passes a rescission bill in that time, the budget authority is
canceled; if Congress does not, the budget authority “shall be made available for
obligation.”
 Second, the President, the Director of OMB, or a department or agency head or employee
may send a special message to Congress proposing a deferral. The ICA lists when budget
authority may be deferred: (1) “to provide for contingencies,” (2) “to achieve savings”
through changed requirements or efficiencies, or (3) “as specifically provided by law.”
The ICA states that “[n]o officer or employee of the United States may defer any budget
authority for any other purpose.” As OMB generally recognizes, the “President may not
defer funds simply because he disagrees with the policy underlying a statute.”
It is important to note, though, that the ICA does not impose “any specific requirements” as to the rate at
which an agency must obligate, much less establish a rule that budget authority must be “fully obligated
as soon as [it] first becomes available, regardless of any necessary programmatic or administrative
considerations.” The ICA permits an agency to take “steps [that] it reasonably believes are necessary to
implement a program efficiently and equitably.” GAO has construed the ICA not to apply to
programmatic delay, which arises when funds “temporarily go unobligated” because the agency is taking
“necessary steps to implement a program.” GAO stresses that “the reason for a delay in obligating, not the
delay alone,” distinguishes delay that must be reported under the ICA from programmatic delay. If an
agency is “making all efforts to” obligate available budget authority, any resulting delay may not need to
be reported to Congress.
Potential Considerations for the WHO Funding Announcement
Though some observers have questioned whether the Administration’s plan to “halt” WHO pending its
“investigation” may result in the withholding of budget authority, it is too early to tell whether relevant
agencies intend to delay the availability of budget authority at all. On May 4, 2020, a senior State

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Department official commented that the unpaid half of the United States’ WHO assessed contributions is
not “due until the end of the fiscal year.” And on the question of delay, as noted above, the ICA applies
only where an agency intends “to refrain from obligating or expending available budget authority.” This is
a program-specific inquiry. GAO often considers “program needs and historical practices” by asking (for
example) whether an agency’s rate of obligation is “comparable” to past fiscal years. If the answer to this
question is “yes,” then that fact suggests that the agency administering the program is not delaying
obligations pending the outcome of the Administration’s investigation. But if the answer to this question
is “no” and obligation rates lag as compared to prior years, further scrutiny may be warranted.
Conclusion
The Trump Administration’s WHO funding announcement has raised questions about agency discretion to
manage appropriated funds. At this early stage, it appears that agencies might have leeway in directing
funding to “new partners” instead of the WHO, as Congress did not specifically require that appropriated
funds be obligated with or for the WHO. And delay in obligating appropriated funds, if any, may be
subject to scrutiny under the ICA if it appears that an agency intends to refrain from making budget
authority available. But reporting under the ICA would not be required if it appears that an agency is
making all efforts to obligate budget authority. For future fiscal years, and depending on its policy
judgment, Congress may limit agency discretion to either support, or not support, WHO projects by
appropriating funds for such uses with more particularity.

Author Information

Sean M. Stiff

Legislative Attorney

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