U.S. Department of Commerce Office of the Assistant General Counsel for Administration General Law Division Interagency Agreements Training June 10, 2014.

U.S. Department of Commerce

Office of the Assistant General Counsel for Administration

General Law Division

Interagency Agreements Training

June 10, 2014

National Weather Service

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Assistant General Counsel for Administration

Barbara S. Fredericks

Ethics Law and Programs DivisionDavid Maggi, Chief

General Law Division

Elise Packard, Chief

Employment and Labor Law DivisionBrian DiGiacomo,

Chief

Our Office

http://www.commerce.gov/os/ogc/general-law-division 202-482-

5391

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Training Roadmap

• Mock Agreement• Concepts–Anatomy of an Agreement–Legal Considerations–Standard IAA Form–Clearance Process

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Why are Agreements Needed?

• Clearly defines what each party is responsible for doing, when, and how

• Identifies authority to transfer and retain funds

• Provides documentary evidence of a binding commitment to disburse Government funds

• Ensures compliance with purpose, time, and amount restrictions

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Anatomy of an Agreement

Agreement Number

Parties & Purpose/

Background

Responsibilities of the Parties

Authority

Estimated Costs

& Accounting Data

Terms of Agreement

Termination/ Cancellation

Clause

Resolution of Disagreement

s

Contact Information

Approving Official

Signature

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Authorities

Agreements require two types of authorities (i.e., legal citations):

1) “Funds transfer” authority: If funds will be transferred, the agreement must cite an authority that permits the transfer.

2) “Programmatic” authority: The agreement also must identify each Federal organization’s authority to undertake the activities set forth in the agreement.

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Economy Act 31 U.S.C. § 1535

• Authorizes Federal agencies to purchase goods and services from other Federal agencies or major organizational units within the same agency.

– Use only when a more specific transfer authority does not exist

– Servicing agency must be reimbursed all actual costs

– Determination and Finding (D&F) required for assisted acquisitions (executed by requesting agency)

– Deobligation requirement*

* More

later!

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Examples of other Authorities

• Special Studies, 15 U.S.C. § 1525

• Intergovernmental Cooperation Act, 31 U.S.C. § 6505

• Coast and Geodetic Survey Act, 33 U.S.C. § 883e, (see §§ 883a, 883b, 883c, and/or 883d)

• Mutual Educational and Cultural Exchange Act, yearly appropriations bill

• Census Organic Act, 13 U.S.C. § 8(b)

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Group Breakout

Discuss §§ 3 and 4

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Group Discussion Questions

Sections 3 & 4: Authority, Economy Act Findings

1. Does each party list a programmatic authority?

2. Does the programmatic authority fit the parties’ purpose/mission?

3. Is a D&F required for this MOU?4. What if NOAA enters into this agreement

with a university rather than ONR—can they use the Economy Act?

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Terms and Conditions

Key Information• Roles and Responsibilities

• Pricing Information

• Description of Work– Be specific• Set forth specific tasks and milestones • Include specific deliverables and due dates

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Key Accounting Data

Treasury Account Symbol (TAS): _______Business Partner Network (BPN)/DUNS:

_______Business Event Type Code (BETC): (COLL or

DISB)Funds expiration date: ______ 

• TAS Examples– Current: 13 14/15 1450– Component:

AID BPOA EPOA A MAIN

013 2014 2015 1450

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Group Breakout

Discuss §§ 5 and 6

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Group Discussion Questions

Section 5. Terms and Conditions

1. What is the agreement amount?

2. What tasks will be completed with the $100k?

3. Can the agreement state ONR will transfer $300k in FY15 funds “subject to the availability of funds”?

4. Will NMFS achieve full-cost recovery? Must it?

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Group Discussion Questions

Section 6: Accounting Data

1. Based on the TAS code, what year funds is ONR using, and when are the funds available for NOAA’s use?

2. For FY14 work, can this TAS be used: a) 1721205? b) 173/41205? c) 1751205?

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Funding/Performance Period

• Period of Availability of the funds

– One-year or multiple-year funds expire after a definite time period

– No-year funds: provide more flexibility on time

• Bona Fide Needs Rule

– Obligate currently available funds for current needs

Example: An agency may not obligate one-year funds to buy extra pencils when it already has plenty on hand to last several years

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Funding/Performance Period

Requesting agency is appropriated one-year funds

1 Oct 2014

30 Sep 2015F

Y1

4F

Y1

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Applying the Bona Fide Needs Rule: Understanding Severable vs. Non-Severable

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Funding/Performance Period

• Severable Services: Provide value as you go

– Are a bona fide need of the year in which the services are performed

– Don’t cross fiscal years (unless using multi-yr/no-yr funds or funds placed on a contract)

1 Oct 2014

30 Sep 2015

FY

14

FY

15

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Funding/Performance Period

• Non-Severable Services: Provide value only when complete

– Are a bona fide need of the year in which the services begin

– Obligate all funds upfront for full period of performance

– Incremental funding is improper.

– Once funds are obligated, performance may cross fiscal years. 1 Oct ‘14 30 Sept ‘15

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Funding/Performance Period

Special Rules for the Economy Act!

• Servicing agency must use (“in-house”) the funds or place on a contract by the funds expiration date.

• Funds not used or placed on a contract in time must be returned to the paying agency (the “deobligation requirement”).

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Group Breakout

 Discuss §§ 7, 8, 9, and 10

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Group Discussion Questions

 Section 7: Duration of Agreement

1. How long is the agreement in effect?

2. How long is the period of performance?

3. If this project is non-severable, may ONR fund 50% of the work if it only has 50% of the funds?

4. If ONR has 100% of funds, can this non-severable work (under the Eco. Act) continue beyond the funds expiration date? Other authority?

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Group Discussion Questions

Section 7: Amendments

1. Must amendments be in writing? Is an email exchange okay? 

2. What if section 7 states “may be amended by notice to NMFS”?

3. What information must be in an amendment for this agreement?

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Termination, Cancellation, & Resolution of

DisagreementsStandard Terms for Federal Interagency Agreements 

• Termination/Cancellation Clause – If [buyer] cancels the order, [seller] is authorized to

collect costs incurred prior to cancellation of the order plus any termination costs, up to the total payment amount provided for under this agreement.

• Disputes Resolution Clause– Disputes related to this agreement shall be resolved in

accordance with instructions provided in the Treasury Financial Manual (TFM) Volume I, Intragovernmental Business Rules Bulletin, available on the TFM Web site at http://www.fms.treas.gov/tfm/vol1/bull.html

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Group Discussion Questions

Section 8: Termination and Cancellation

1. Does this section require written notice to the other party?

2. How many days’ notice must be given? Reasonable?

3. Can NMFS terminate early?

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Group Discussion Questions

Sections 9 & 10: Resolution of Disagreements, Disclosure of Records or Data

1. If the agreement is with a private party will this disputes clause still work?

2. Is Section 10 consistent with FOIA requirements?

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Signing Agreements

Signature Block

1. Why must both parties sign the agreement?

2. ONR already has signed the agreement. Can NMFS begin work?

3. Can the parties sign prior to funds availability?

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Other Legal Issues

• Federal Advisory Committee Act (FACA): Triggered when an agency seeks consensus advice from a group that includes at least one non-Federal person

• Indemnification: Cannot agree to indemnify other parties because this could violate the Anti-Deficiency Act

• Insurance: Government is self-insured and doesn’t buy insurance

• Records: Provisions requiring destruction/maintenance of documents must comply with your records retention schedule.

• State law and choice of venue: Government is subject only to Federal law, not state law or the jurisdiction of state courts.

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Standard IAA Form

Comprised of two sections

– 7600A: General Terms and Conditions (GT&C) Section; and

– 7600B: Order Requirements and Funding Information (Order) Section

Updated Department Instructions:http://www.commerce.gov/os/ogc/general-

law-division

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Standard IAA Form

• IAA Instructions Attachment (redline version)– Identifies specific IAA blocks requiring attention

. . . for example . . . • GT&C Section

– Block 3. Assisted Acquisition Agreement (Yes/No)– Block 5. Agreement Period – Block 10. Statutory Authority

• Order Section– Block 25. Order Action – Block 26. Funding Modification (existing orders)– Block 27. Performance Period

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Clearance Process

1. Bureau – Follow bureau’s policy (e.g., Finance, Budget,

Program Counsel)

2. Assisted Acquisitions– Review by OGC Contract Law Division– For the Contract Law Division’s policies on obtaining

review of assisted acquisition agreements see: http://www.commerce.gov/os/ogc/contract-law-division

3. General Law Division– http://www.commerce.gov/os/ogc/general-law-division

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The End

Questions?

General Law Division Attorney of the Day

202-482-5391

http://www.commerce.gov/os/ogc/general-law-division