APPORTIONMENTS AND REAPPORTIONMENTS

a. NIST has three appropriations which receive funding on an annual basis.  These appropriations are the Scientific and Technical Research and Services (STRS), the Industrial Technology Services (ITS), and the Construction of Research Facilities (CRF).  All appropriations must be administratively apportioned as specifically provided by law to prevent obligation or expenditure at a rate that would indicate a necessity for a deficiency or supplemental appropriation for the period. A reserve may be established to provide for contingencies, to achieve savings or greater efficiency of operations.

Appropriations are commonly apportioned by quarter, based on estimated obligations to be incurred each quarter. At the end of each quarter, unobligated balances of apportionment are available, on a cumulative basis, for obligation in subsequent quarters without reapportionment unless otherwise specified by OMB. Apportionments also may be in total by specific programs, projects, activities, objects, or combinations thereof.  STRS and CRF funding are apportioned by quarter.  The ITS and CRF appropriations contain congressionally directed programs (category B funding). Funds in these appropriations with this designation are not required to be apportioned within specific quarterly timeframes.

The NIST Working Capital Fund shall be available for obligation for any activities for which provision is made in the appropriations which reimburse the fund, and the fund may be credited with advances and reimbursements, including receipts from non-Federal sources, for services performed. OMB does not require NIST to apportion Working Capital Funds.

b. Preparation and Submission of Schedules - Requests for apportionment of NIST appropriations are submitted to OMB through the Department of Commerce (DOC) on the Apportionment and Reapportionment Schedule, SF-132, “by August 21 or within ten calendar days after approval of the appropriation act” (OMB Circular A-11 (2008) Section 120.30). Financial plans which are consistent with the subactivity levels presented in the budget are submitted in support of the schedules. The Budget Division is responsible for the preparation and submission of the schedules.

At OMB, apportionment requests are referred to the examiners responsible for the programs involved, who review requests and the supporting material to arrive at recommendations on amounts to be apportioned. “OMB will notify you [the Institute] of its action taken on apportionment or reapportionment requests by September 10, or within 30 calendar days after the approval of the act providing new budget authority, whichever is later” (OMB Circular A-11 (2008) Section 120.36).

A request for reapportionment is submitted as soon as a change in a previous apportionment becomes necessary due to a change in resources or within ten days after legislation is passed which changes budget authority.

c. Apportionment Reserves - Reserves may be established by OMB only to provide for contingencies, or to effect savings whenever savings are made possible by or through changes in requirements or greater efficiency of operations. Amounts reserved may not be obligated by the agency but may be released in whole or in part by reapportionment action by OMB at any time during the year or by Congressional action on proposed rescissions or deferrals. Reserves must be reported by the President to the Congress as either a proposed rescission or a proposed deferral. Proposed rescissions must be released if both Houses of Congress have not completed action on the rescission bill within 45 days. Proposed deferrals must be released if either House of Congress passes an impoundment resolution disapproving such proposed deferral.

d. Apportionment Control - The original copy of an approved apportionment is maintained by the Budget Division. The Budget Division records the apportionment in the financial management system, Commerce Business System (CBS), in which funds are controlled at the appropriation level. The Budget Division ensures from its control records that OU allocations are within the apportioned amounts. The Finance Division verifies that obligated balances in the standard general ledger accounts do not exceed apportioned amounts.

e. Employment and Outlay Ceilings - OMB may establish ceilings on employment and issue target outlay ceilings as supplements to the apportionment process. Although special requirements are imposed by law from time to time, generally OMB ceilings are applicable as administrative rather than legal limitations, and they are issued on an agency-wide basis rather than on an individual appropriation basis.

ALLOCATIONS TO OPERATING UNITS

a. Through the CFO/Deputy CFO/Budget Division, the Director assigns total allocations of appropriations, with quarterly breakdowns by program code, to the OU Directors and Chief Officers. For appropriations which are apportioned quarterly, the sum of the allocations may not exceed the quarterly distribution and total appropriation amounts, in accordance with the provisions of the Antideficiency Act. These allocations constitute authority for OU Directors and Chief Officers to incur obligations or costs within a given amount.

The OU Directors and Chief Officers divide their allocations by assigning operating budgets to division chiefs within their OU. In addition, managers of NIST-wide programs provide operating levels to all organizational units which receive program funding. These operating levels are further divided into project authorizations by quarter, which are entered into CBS.

The initial allocation is intended to provide for the performance of the primary responsibilities of the OU throughout the fiscal year. The OU Director is responsible for conducting the program within the limits of the allocation. In the event that an allocation is exceeded, the OU Director or division chief directly responsible for the overrun may be subject to administrative discipline if the circumstances warrant. The statutory penalties of the Antideficiency Act concerning over-obligation of funds do not apply to the allocations to the OU Director, except as they affect NIST as a whole. However, it is important that each OU Director recognize their responsibility to conduct operations within the allocation.

b. The Budget Division issues revised OU quarterly allocations to reflect changes due to appropriation transfers of funds from other agencies, distribution of unobligated balances, distribution of additional appropriations, rescission of funds, and other financing adjustments. The Budget Division should be informed as soon as possible if it appears that a departure from the quarterly plan is necessary. A reapportionment may be obtained if the change cannot be accommodated within the existing apportionment.

OPERATING BUDGETS

a. Development of Annual Operating Budgets - The base point for developing operating budgets for appropriated funds for the coming year is the budget as communicated to the Congress. During the spring of each year, the Budget Division develops for the Director's approval funding levels for each appropriation by program and OU for the following fiscal year. These levels are determined by the timing of Congressional action, but they normally are the House or Senate Allowance or the level of the previous fiscal year, whichever is lower.  These funding levels are issued to OU Directors prior to the beginning of each fiscal year. OUs establish project authorizations by quarter that reflect estimated annual spending.  Appropriations with congressionally directed funding (ITS and  CRF) are not issued quarterly allocations.

b. Issuance of Operating Budgets - The Budget Division issues operating budgets at OU and division levels at the start of the fiscal year. Each month, revised operating budgets are issued to reflect any changes in funding or program levels. OU operating budgets support the NIST financial plans throughout the year.
 
FUNDS CONTROL AND REPORTING

a. Agency heads are responsible for establishing and maintaining accounting and internal control systems that provide reliable accounting for agency activities that will be the basis for preparing and supporting the agency budget request and for executing the agency budget.

Reports generated from the financial management system reflecting financial status are used by NIST management to maintain obligations within authorized levels and to comply with any restrictions included in appropriations acts. Managers must reconcile any locally-maintained records to the official accounting records in CBS.

NIST-wide year-end analyses are performed to ensure that all transactions affecting the appropriation and fund balances have been recorded properly, accurately, completely, and on a timely basis. All estimated obligations are reviewed for reasonableness and appropriateness, and adjustments are made as necessary.

b. External Reporting Requirements - The OMB and DoC systems for control of funds require periodic reporting against approved plans to evaluate progress and detect early deviations from approved plans.

The Finance Division prepares a quarterly Report on Budget Execution, SF-133, and an annual Year End Closing Statement, FMS 2108, for each NIST appropriation or fund account that are submitted to Treasury via the Federal Agencies’ Centralized Trial Balance System (FACTS II).  The Budget Division reviews the SF-133s and advises the Finance Division of their concurrence prior to transmittal.  Certified copies are also provided to the DoC Office of Financial Management and DoC Office of Budget.

The Budget Division prepares the following for submission to the Department and OMB:

(1) Outlay plans by appropriation by month. Revisions to the initial plan and reports of actual outlays are required during the year.

(2) Financial plans of obligations by appropriation by budget subactivity by month.

(3) Staffing plans when requested by DoC are prepared and show FTE and onboard staffing estimates by month for NIST in total.

Revisions to the financial and staffing plans may be made to reflect changes in OMB ceilings, approved reprogramming, or changes which require reapportionment of funds. Reports against the plans are submitted monthly to DoC by the Budget Division. Variances of more than ten percent from the budget subactivity plan must be explained. Affected OU management and program managers will be asked to provide supporting information.

REPROGRAMMING

a. Reprogramming is the technical term applied to the transfer of funds and associated positions between programs, projects, or activities (budget subactivities or line items) which results in a change in the resources for a Program Project or Activity (PPA) from that reflected within the Congressionally approved budget for the current fiscal year. In addition it includes:

(1) Proposals to use apportionment reserves or unobligated balances available from prior-year appropriations for purposes other than those for which they were appropriated; and

(2) Significant changes in program direction or output (without transfer of funds) from those justified in the budget.

b. As specified in the General Provisions of the annual Appropriations Act, proposed reprogramming actions which equal or exceed $500,000 or ten percent of a PPA require Congressional approval. The Budget Division is responsible for submitting external notifications of reprogramming to DoC, OMB, and Congress in the required formats before the reprogramming is effected. Congress has 15 days to respond to a reprogramming notification. In the event Congress does not respond within the designated 15 day timeframe, the reprogramming is considered approved.

c. OU Directors and Chief Officers may propose a reprogramming action (both within and exceeding the NIST statutory limitations) for consideration by the Director.  The request should be sent to the Director via the Chief Financial Officer/Deputy Chief Financial Officer submitted through the Chief of the Budget Division and must include a justification of the reprogramming and details of the resources involved.
 
DISPOSITION OF END-OF-YEAR UNOBLIGATED BALANCES AND OVER- AND UNDER-ACCRUAL OF PRIOR-YEAR OBLIGATIONS

a. All recorded obligations against NIST appropriations are financed from funds authorized by the Director. Until the obligations are liquidated (paid) or cancelled, these obligations and authorizations are carried forward and identified with the fiscal year of obligation. Since NIST appropriations are "no-year appropriations," which means that obligations may be incurred beyond the end of the fiscal year for which the appropriation was made, the following procedures have been established to ensure the effective and timely utilization of all funds, consistent with program plans.

b. End-of-Year Unobligated Balances - For the Scientific and Technical Research and Services appropriation, each OU may retain for use in the following fiscal year unobligated balances of up to one-half of one percent of its total STRS budgetary resources unless otherwise instructed by the Director.  An OU may request the Director's approval to retain additional balances when circumstances warrant (for example, a large increase which was not apportioned until late in the fiscal year to be fully obligated). The justification in support of the request must be specific as to the programs, contracts, projects, and affected milestones for which carryover is needed. Specific instructions for such requests are issued by the Budget Division during the fourth quarter of the fiscal year.

Unobligated balances in the Construction of Research Facilities and Industrial Technology Services appropriations are authorized in total to the program managers, once they are apportioned by OMB, and, are executed in a manner consistent with apportionment process designations.

c. Over- and Under-Accrual of Prior-Year Obligations - Unliquidated obligations do not always accrue for exactly the same amount as the original obligation. In the case of obligations that were made in prior years, this may result in unbilled costs, (which must be paid for), or may result in excess balances.

Changes in prior-year payments and obligations are monitored throughout the year by the Budget Division and the Finance Division. Generally, they are summarized by OU and program code at the end of the fiscal year, and balances are added to carryover allocations or deficits are netted against budgetary resources. If a particular organizational unit shows a pattern of consistent or large prior-year deficits, the transactions are reviewed and corrective action, if necessary, is recommended to NIST management.

In unusual circumstances, when a prior-year recovery (deobligation) becomes available and is needed during the current fiscal year, the OU may request by memorandum to the Budget Division that the balance be made available in the current fiscal year. The amount should be at least $10,000, and the memorandum should supply sufficient justification as to (1) why the funds were deobligated and (2) why the funds are needed in the current fiscal year. The Budget Division may return the funds to the requesting division only if the apportionment will not be exceeded and if year-to-date OU and NIST recovery levels are sufficient to permit such an allocation.
 
REVIEW AND EVALUATION

a. Within DoC, the Office of the Inspector General and offices under the Chief Financial Officer have joint responsibilities for evaluating the program and financial performance of the bureaus and offices. The Office of the Inspector General conducts centralized management audits of the operating, administrative, and financial activities of all organizational units, and of selected claims, costs, cost proposals, and cost and pricing data arising from contracts, grants, subsidies, and loans or other similar agreements entered into or proposed by bureaus of the Department. The offices under the DoC CFO conduct program studies and analyses, prepare reports on program and fiscal status, and perform assessments of internal controls over reporting.

b. The Government Accountability Office (GAO) conducts independent audits of the operations of the Department. GAO serves as the chief administrative arm of the Congress to ensure that laws relating to program management and financial operations of the government are being properly observed. GAO reports directly to the Congress on its findings.
 
PROCEDURAL GUIDANCE

Procedural guidance can be found in the following publications:

--The Impoundment Control Act of 1974 provides legal procedures for impoundment of federal funds.

--Federal Managers’ Financial Integrity Act (FMFIA) of 1982 provides the statutory basis for management’s responsibility for and assessment of internal financial controls.

--OMB Circular A-11, Preparation, Submission, and Execution of the Budget, provides instructions on financial plans, apportionments, reapportionments, deferrals, proposed and enacted rescissions, systems for administrative control of funds, allotments, operating budgets, reports on budget execution, and reports on violations of the Antideficiency Act.

--OMB Circular A-123, Management Accountability and Control, requires agency management to assess, document, and report on internal controls over financial reporting.

--The DoC Accounting Principles and Standards Handbook prescribes accounting principles and standards to be followed within the Department in the design and operation of accounting systems, and it provides specific accounting principles and standards against which financial management and accounting systems can be evaluated and improved.(http://www.osec.doc.gov/ofm/Accounting/cover.html)

--The DoC Budget and Program Analysis Handbook contains policies and procedures governing the preparation and justification of the Department’s budgets and the information and analysis necessary to meet the Secretary’s responsibilities for managing the budget (http://www.osec.doc.gov/bmi/budget/Budget%20Handbook.htm).