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Army Lawyer

FISCAL LAW: Anti-Deficiency Act

January / February, 2003

The Army Lawyer

2003 Army Law. 218


Major Thomas C. Modeszto (Editor), Lieutenant Colonel Michael J. Benjamin, Major Karl W. Kuhn, Major Bobbi J.W. Davis, Major Gregg S. Sharp, Major Kevin J. Huyser (USAF), Major James M. Dorn, Colonel Jonathan H. Kosarin, Colonel Steven J. Gillingham, Lieutenant Colonel Louis A. Chiarella, Lieutenant Colonel Steven N. Tomanelli (USAF), Major Timothy M. Tuckey and Ms. Margaret K. Patterson


It Can Happen to the Best of Us

In a letter to the Chairman of the House Committee on Appropriations, 1 the General Accounting Office (GAO) found that both the Office of Management and Budget (OMB) and the Air Transportation Stabilization Board (ATSB) 2 had violated the Anti-Deficiency Act (ADA). 3 The two agencies failed to transmit an appropriate request to Congress, as required under the Air Transportation Safety and System Stabilization Act (Stabilization Act), 4 which resulted in the agencies' apportioning and obligating funds without budget authority.

The circumstances of this ADA violation involved a loan guarantee for America West Airlines under the Stabilization Act. Under the Stabilization Act, Congress authorized the President to extend air passenger carriers up to $ 10 billion in loan guarantees for losses they incurred because of the 11 September 2001 terrorist attacks. 5 Although the Act designated this new budget authority as an "emergency requirement" under the Balanced Budget and Emergency Deficit Control Act of 1985 (Balanced Budget Act), 6 the Act required the President to send Congress a "request, that includes designation of such amount as an emergency requirement" before exercising this budget authority. 7

On 28 December 2001, the ATSB approved America West's loan guarantee application. As a result, on 18 January 2002, the OMB apportioned $ 172 million "to support the subsidy cost associated with the loan guarantee." 8 Later that same day, the ATSB signed the loan guarantee, which created a legal obligation for purposes of ...
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