Volume 3, Chapter 6

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VOLUME 3, CHAPTER 6: “REPROGRAMMING OF DOD APPROPRIATED

FUNDS”

SUMMARY OF MAJOR CHANGES

Changes are identified in this table and also denoted by blue font.

Substantive revisions are denoted by an * symbol preceding the section, paragraph,

table, or figure that includes the revision.

Unless otherwise noted, chapters referenced are contained in this volume.

Hyperlinks are denoted by bold, italic, blue and underlined font.

The previous version dated March 2011 is archived.

PARAGRAPH

EXPLANATION OF CHANGE/REVISION

PURPOSE

3.2

(060302)

Added requirement that Components use the Enterprise

Funds Distribution (EFD) system for transmitting DD

Form 1414, Base for Reprogramming Actions

submissions

Update

4.1.5.

(060401.E)

Updates to sub-activity reprogramming requirements Update

4.7

(060407)

Added requirement that Components use the Enterprise

Funds Distribution (EFD) system to submit

reprogramming actions

Update

5.2

(060502)

Added requirement that Components use the Enterprise

Funds Distribution (EFD) system to update DD Form

1416, Report of Programs

Update

12.0

(0612)

FY 2014 National Defense Authorization Act eliminated

the requirement for the Readiness Transfer Report

Deleted

Appendix B

FY 2014 National Defense Authorization Act eliminated

the requirement for the Readiness Transfer Report

Deleted

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Table of Contents

VOLUME 3, CHAPTER 6: “REPROGRAMMING OF DOD APPROPRIATED FUNDS” ...... 1

1.0 PURPOSE (0601) .............................................................................................................. 4

1.1 Department for the Reprogramming (060101) .................................................... 4

1.2 Reprogramming Procedures (060102) ................................................................. 4

1.3 Reprogramming Policy (060103) ......................................................................... 4

2.0 REPROGRAMMING DOCUMENTS IN GENERAL (0602) ......................................... 4

2.1 DD 1414, Base for Reprogramming Actions (060201) ....................................... 4

2.2 DD 1415, Reprogramming Action (060202) ....................................................... 5

2.3 DD 1416, Report of Programs (060203) .............................................................. 5

3.0 DETAILED PROCEDURES FOR BASE FOR REPROGRAMMING ACTIONS (0603)

........................................................................................................................................... 5

3.1 General (060301) ................................................................................................. 5

3.2 Due Date (060302) ............................................................................................... 5

3.3 Transmittal (060303) ............................................................................................ 5

3.4 Security Classification (060304) .......................................................................... 6

3.5 Detailed Instructions for Preparation of the DD 1414 (060305).......................... 6

4.0 REPROGRAMMING ACTIONS (0604).......................................................................... 6

4.1 Reprogramming Actions Requiring Written Congressional Approval (060401) 6

4.2 Internal Reprogramming Actions (060402) ....................................................... 10

4.3 Letter Notifications to Congress (060403) ......................................................... 11

4.4 Failure to Provide Proper Notification (060404) ............................................... 12

4.5 Transfer Authority (060405) .............................................................................. 12

4.6 Detailed Instructions and Formats for Preparation of DD 1415 (060406) ......... 13

4.7 Submittal by Components (060407) .................................................................. 13

4.8 Signed DD 1415s (060408) ................................................................................ 14

4.9 OMB Approval (060409) ................................................................................... 14

4.10 Distribution of the DD 1415-1 (060410) ........................................................... 14

4.11 Congressional Committee Approval of DD 1415 Requests (060411) ............... 14

4.12 Implementation Memorandums for Reprogramming Actions. (060412) .......... 15

4.13 Alternate Letters or Revised Actions for New Sources (060413) ...................... 16

4.14 Withdrawal of Reprogramming Actions (060415) ............................................ 16

5.0 DD 1416, REPORT OF PROGRAMS (0605) ................................................................ 17

5.1 General (060501) ............................................................................................... 17

5.2 Due Date (060502) ............................................................................................. 17

5.3 Procurement Line Items “Items Less Than $5 million (060503) ....................... 17

5.4 Program Base Columns Reflecting Congressional Action (060504) ................. 17

5.5 Detailed Instructions for Preparation (060505).................................................. 18

6.0 REPROGRAMMING OF INTELLIGENCE RESOURCES (0606) .............................. 18

6.1 Intelligence Reprogramming Guidance (060601) .............................................. 18

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Table of Contents (Continued)

6.2 Oversight (060602) ............................................................................................ 18

6.3 Submission Procedures (060603) ....................................................................... 18

6.4 Procedures (060604) .......................................................................................... 19

6.5 Below-Threshold Reprogrammings (060605) ................................................... 19

7.0 REPROGRAMMING OF SPECIAL ACCESS PROGRAMS (0607) ........................... 19

7.1 Provision in Law (060701) ................................................................................. 19

7.2 General (060702) ............................................................................................... 19

8.0 BELOW-THRESHOLD REPROGRAMMING ACTIONS (0608) ............................... 19

8.1 Purpose (060801) ............................................................................................... 19

8.2 Guidelines (060802) ........................................................................................... 20

9.0 REPLACEMENT OF ITEMS SOLD FROM INVENTORY (0609) ............................. 21

9.1 Policy (060901) .................................................................................................. 21

9.2 Guidelines (060902) ........................................................................................... 21

10.0 REPROGRAMMING POLICY FOR CLOSING APPROPRIATION ACCOUNTS

(31 U.S.C. 1551 et seq) (0610) .................................................................................................. 22

10.1 Definitions of Contract Changes for Reprogramming Purposes (061001) ........ 22

10.2 Use of Currently Available Appropriations to Fund Out-Of-Scope Contract

Changes (061002) ............................................................................................................ 22

10.3 Use of Currently Available Appropriations to Fund Obligations or Adjustments

to Obligations that Otherwise Would Have Been Funded from a Canceled Appropriation

Account (061003) ............................................................................................................ 23

10.4 Use of Expired Appropriations to Fund Contract Changes (061004) ................ 24

11.0 NATIONAL GUARD AND RESERVE EQUIPMENT APPROPRIATION

NOTIFICATION PROCEDURES (0611) ................................................................................ 24

11.1 General (061101) ............................................................................................... 24

11.2 Procedures for Revisions to the Summary NGREA Acquisition Report (061102)

............................................................................................................................ 24

*12.0 OPERATION AND MAINTENANCE QUARTERLY EXECUTION REPORT (0612) .

......................................................................................................................................... 25

*12.1 Purpose (061201) ............................................................................................... 25

12.2 Submission Requirements (061202) .................................................................. 25

12.3 Preparation of Material (061203) ....................................................................... 25

12.4 References (061204) .......................................................................................... 26

12.5 Operation and Maintenance Quarterly Execution Report Exhibit (061205) ..... 26

Appendix A Part 4 – Report of Programs ............................................................................... 37

Appendix B – Operation and Maintenance Budget Execution Data ......................................... 38

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CHAPTER 6

REPROGRAMMING OF DOD APPROPRIATED FUNDS

1.0 PURPOSE (0601)

1.1 Department for the Reprogramming (060101)

This chapter establishes the policies of the Department for the reprogramming of

appropriated funds. Guidance in this chapter reflects recognition by the Congress of the practice

of reprogramming DoD funds covered in DoD Appropriations Acts as a necessary, desirable, and

timely device for achieving flexibility in the execution of DoD programs. Also, reprogramming

policies and procedures for military construction and family housing appropriations covered by

the Military Construction Appropriations Act can be found in Chapter 7 and the

National Intelligence Program (NIP) reprogramming policies and procedures covered by the

National Security Act of 1947, as amended, can be found in section 0606, Reprogramming of

Intelligence Resources.

1.2 Reprogramming Procedures (060102)

Procedures are provided for establishing the base for reprogramming actions; submitting,

approving, and processing reprogramming actions; and for the report of programs reflecting all

supplemental appropriations, rescissions, transfers, and reprogramming actions.

1.3 Reprogramming Policy (060103)

The policy herein replaces reprogramming guidance contained in the March 2011,

DOD 7000.14-R, “Financial Management Regulation,” Volume 3.

2.0 REPROGRAMMING DOCUMENTS IN GENERAL (0602)

2.1 DD 1414, Base for Reprogramming Actions (060201)

The DD 1414 establishes the base for reprogramming actions and transfers. The report

shall include a table for each appropriation enacted in the annual Department of Defense

Appropriations Act, with separate columns to display the Program Base Presented to Congress,

Approved Changes Prior to Congressional Action (e.g., budget amendments or other changes to

the budget formally submitted an appropriations committee), Changes Reflecting Congressional

Action (e.g., project level adjustments or undistributed rescissions as indicted in Conference

Reports), and the Program Base Reflecting Congressional/Presidential Action. Tables for each

appropriation shall delineate each budget activity and program, project, and activity established in

administration budget justification materials or in the Conference Report accompanying enacted

funding bills. Each budget activity and program, project, and activity shall be footnoted to identify

those items known to be of special interest to one or more of the congressional committees and

those items specifically denied by the Congress. The items should include, as a minimum, those

items for which additional funds have been provided or items for which funding is specifically

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reduced as shown in the project level table or in paragraphs using the phrases “only for” or “only

to” or are congressional special interest items for the purpose of the Base for Reprogramming

(DD Form 1414).

2.2 DD 1415, Reprogramming Action (060202)

Reprogramming actions, upon approval of the Department, will be used to request the prior

approval (DD 1415-1) of the congressional committees to realign or transfer appropriated funds

or for internal reprogramming (DD 1415-3) requiring audit-trail type documentation of the

realignment or transfer of appropriated funds.

2.3 DD 1416, Report of Programs (060203)

The DD 1416 report reflects the congressionally approved programs as enacted,

reprogramming actions which have been approved, congressionally directed undistributed

amounts and transfers, and reprogramming of funds that have been implemented by a DoD

Component using below-threshold reprogramming flexibility. This report is generated in the

Enterprise Funds Distribution (EFD) system quarterly and submitted 30-days after the end of

each quarter, electronically to the congressional defense committees by the Under Secretary of

Defense (Comptroller) (OUSD(C)), Program and Financial Control Directorate (P&FC), for

Title III, Procurement, and Title IV, Research, Development, Test, and Evaluation and annually

for Title I, Military Personnel, and Title II, Operation and Maintenance appropriations

3.0 DETAILED PROCEDURES FOR BASE FOR REPROGRAMMING ACTIONS (0603)

3.1 General (060301)

The DD Form 1414, Base for Reprogramming Actions, establishes the base from which

reprogramming actions may be taken. It identifies line items within each appropriation covered in

the DoD Appropriations Acts.

3.2 Due Date (060302)

Within 30 days following enactment of the Department of Defense (DoD) Appropriations

Act, the Components will submit their DD 1414, Base for Reprogramming Actions to OUSD(C)

P&FC to ensure the Department can submit the Base for Reprogramming Actions to the

congressional committees within 60 days of enactment as required by recurring general provisions

in DoD Appropriations Acts (e.g., section 8007 of division C of Public Law 113-235, the

Department of Defense Appropriations Act, 2015). The DoD Components will submit their

DD 1414 through the Enterprise Funds Distribution (EFD) system, for review prior to

submission to the congressional committees.

3.3 Transmittal (060303)

Upon determination by the OUSD(C) P&FC that the Base for Reprogramming Action is

acceptable, OUSD(C) P&FC will submit to OMB, pursuant to OMB Circular A-11, section 22.3.

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After clearance by OMB, the OUSD(C) P&FC will prepare for printing and transmittal to the

congressional committees. Final printed copies will be distributed to the DoD Components as well

as posted on the Comptroller public website.

3.4 Security Classification (060304)

In order facilitate use by the staffs of the congressional defense oversight committees, the

Department will submit an unclassified report. Therefore, each Service shall submit an

unclassified DD 1414 and OUSD(C) P&FC will be responsible for proper security review prior to

publication. All classified programs should be consolidated into a single line item titled

Classified Programs and should be displayed at the end of the Direct Program section.

3.5 Detailed Instructions for Preparation of the DD 1414 (060305)

Detailed instructions for the Base for Reprogramming Actions for the initial appropriations

act are provided in the appendices to this chapter.

4.0 REPROGRAMMING ACTIONS (0604)

4.1 Reprogramming Actions Requiring Written Congressional Approval (060401)

Two types of reprogramming actions will be used to request the prior approval of the

congressional defense committees. Both requests are submitted using DD 1415-1, Prior Approval.

The first type is for specific requirements, which usually are combined and submitted monthly.

The second type is the annual Omnibus reprogramming action submitted prior to June 30 of each

year, which was established in Fiscal Year (FY) 1991 to streamline the reprogramming process

for the congressional committees and the Department. With the exception of reprogrammings of

National Intelligence Program resources (paragraph 060604), the USD(C) submits all

reprogramming actions to the congressional defense committees. The Department is expressly

prohibited from preparing or forwarding to the Congress a prior approval reprogramming action

except “for higher priority items, based on unforeseen military requirements, than those for which

originally appropriated and in no case where the item for which reprogramming is requested has

been denied by the Congress.” It is the Department’s policy that reprogramming actions, which

require prior approval of the congressional committees (DD 1415-1), are those which involve the

application of funds that:

4.1.1. Increase the procurement quantity of a major end item, such as an individual aircraft,

missile, naval vessel, tracked combat vehicle, and other weapon or torpedo and related support

equipment for which funds are authorized. (In such cases where specific congressional language

is provided allowing for additional quantities to be procured within appropriated funds, increases

to quantities for major end items shall be submitted to the USD(C) for approval as a DD 1415-3,

Internal Reprogramming action.)

4.1.2. Affect an item that is known to be or has been designated as a matter of special

interest to one or more of the congressional committees. In rare instances, when funds from special

interest items are to be reprogrammed from an existing program, subprogram, project, or

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subproject to another program, subprogram, project, or subproject within the same procurement

line item or program element, letter notification to the congressional committees may be made.

Letters shall be submitted to the congressional committees by the DoD Component involved only

after advance coordination with the applicable OUSD(C) P/B Directorate.

4.1.3. Use general transfer authority. Any movement of funds between appropriations or

legal subdivisions requires statutory transfer authority. Unless specific transfer authority is

provided elsewhere, general transfer authority, which is provided in annual DoD Appropriations

and Authorization Acts, must be used. Any movement of funds from supplemental appropriations

also uses the general transfer authority provided in the annual DoD Appropriations Act.

Section 2214 of Title 10 of the United States Code (U.S.C.) and the annual Appropriations Act

provide limitations on programs for which general transfer authority may be used. Such authority

may not be used except to provide funds for a higher priority item, based on unforeseen military

requirements, than the items for which funds were originally appropriated, and may not be used if

the Congress has denied funds for the item. Exceptions to the use of a DD 1415-1,

Prior Approval Reprogramming action, may apply if reclassification of programs to the proper

appropriation for execution is required (i.e., these actions do not change the purpose for which the

funds were originally appropriated). (See paragraph 060402A).

4.1.4. Exceed thresholds agreed upon between the committees. Effective for FY 2015, the

basic reprogramming thresholds agreed upon between the committees and the Department are:

$10 million for military personnel; $15 million for operation and maintenance; $20 million for

procurement; and $10 million for research, development, test, and evaluation. These thresholds

are cumulative from the base for reprogramming value as modified by any congressional action,

to include the initial appropriation, rescissions, supplemental appropriations, and approved

DD 1415 reprogramming actions. The BTR limitation is the net value of transfers into or out at

the specified level. For example, transfers using Below Threshold Reprogramming (BTR)

authority of $5.0 million out of an RDT&E PE line item and transfer of $4.0 million into the same

RDT&E PE line item would result in a total amount transferred of $1.0 million, with the

consequence that the $1.0 million of BTR authority was used. The thresholds agreed upon between

the committees and the Department are as follows:

4.1.4.1. Military Personnel. A cumulative increase of $10 million or more in a

budget activity.

4.1.4.2. Operation and Maintenance. A cumulative increase or decrease of

$15 million or more to a budget activity or to a Defense Agency for Operation and Maintenance,

Defense-Wide appropriation. When the congressional committees impose reprogramming

thresholds on specific sub-activity group categories, these threshold amounts are separately

identified on the DD 1414, Base for Reprogramming Actions, and reprogramming restrictions

apply. For example for FY 2015, congressional committees imposed reprogramming thresholds

on specific sub-activity group categories.

4.1.4.2.1. The committees required the Department to follow Prior

Approval procedures for transfers in excess of $15.0 million out of the following budget

sub-activities:

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4.1.4.2.1.1. Army: Maneuver units; modular support brigades;

land forces operations support; force readiness operations support; land forces depot

maintenance; base operations support; and facilities sustainment, restoration, and

modernization.

4.1.4.2.1.2. Navy: Aircraft depot maintenance; ship depot

maintenance; and facilities sustainment, restoration, and modernization.

4.1.4.2.1.3. Marine Corps: Depot maintenance and facilities

sustainment, restoration, and modernization

4.1.4.2.1.4. Air Force: Primary combat forces; combat

enhancement forces; combat communications; and facilities sustainment, restoration, and

modernization.

4.1.4.2.1.5. Air Force Reserve: Depot maintenance.

4.1.4.2.1.6. Air National Guard: Depot maintenance.

4.1.4.2.2. The committees required the Department to follow Prior

Approval procedures for transfers in excess of $15.0 million into the following budget

sub-activity:

4.1.4.2.2.1 Army National Guard: Other personnel

support/recruiting and advertising.

4.1.4.2.3. Defense-Wide O&M: transfer of funds to or from the levels

specified for defense agencies in excess of $15.0 million shall be subject to a PA reprogramming

action.

4.1.4.2.4. For FY 2015, the committees further require the Services, with

Comptroller coordination, to provide written notification not later than 15-days prior to

implementing transfers in excess of $15.0 million out of the following budget sub-activities:

4.1.4.2.4.1. Navy: Mission and other flight operations and

mission and other ship operations

4.1.4.2.4.2. Air Force: Operating forces depot maintenance;

mobilization depot maintenance; training and recruiting depot maintenance; and

administration and service-wide depot maintenance.

4.1.4.2.5. Defense Health Program: For FY 2015, any transfer of funds

from the In-House Care budget sub-activity to any other sub-activity shall be subject to a PA

reprogramming action. In addition, any cumulative transfer of funds in excess of $10,000,000

from the Private Sector Care sub-activity requires written notification to the congressional

defense committees not later than fifteen days after such a transfer occurs.

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4.1.4.2.6. The above requirements were set forth in reprogramming

guidelines in the explanatory statement accompanying the DoD Appropriations Act, 2015 and are

subject to change in conference reports accompanying future appropriations acts.

4.1.4.3. Procurement. A procurement program is defined by the items included in

the DD 1414, Base for Reprogramming Actions.

4.1.4.3.1. Increases. A cumulative increase of $20 million or more or

20 percent of the program base amount, which includes the initial appropriation, rescissions,

supplemental appropriations, and approved DD 1415 reprogrammings (i.e., cumulative over the

entire obligational availability of a specific year appropriation), whichever is less.

4.1.4.3.2. Decreases. A cumulative decrease of $20 million or more, or 20

percent of the program base amount, which includes the initial appropriation, rescissions,

supplemental appropriations, and approved DD 1415 reprogramming (i.e., cumulative over the

entire obligational availability of a specific year appropriation), whichever is less.

4.1.4.4. Research, Development, Test, and Evaluation (RDT&E). A research

program is defined by the items included in the DD 1414, Base for Reprogramming Actions.

4.1.4.4.1. Increases. A cumulative increase of $10 million or more or

20 percent of the program base amount, which includes the initial appropriation, rescissions,

supplemental appropriations, and approved DD 1415 reprogramming (i.e., cumulative over the

entire obligational availability of a specific year appropriation), whichever is less.

4.1.4.4.2. Decreases. A cumulative decrease of $10 million or more, or 20

percent of the program base amount, which includes the initial appropriation, rescissions,

supplemental appropriations, and approved DD 1415 reprogramming (i.e., cumulative over the

entire obligational availability of a specific year appropriation), whichever is less.

4.1.5. Initiates a new start. A new start program for RDT&E is a new program element or

project, or a major component thereof, as determined by specific supporting information provided

in the R-2 and R2A (RDT&E Budget Item/Project Justification) exhibits not previously justified

by the Department and funded by the Congress through the normal budget process is considered

to be a new start. A new start program for Procurement is a new procurement line item or major

component thereof, as determined by specific supporting information provided in the P-5

(Cost Analyst) or P40A (Budget Items Just for Aggregated Items) exhibits not previously justified.

Congressional committees discourage the use of the reprogramming process to initiate programs.

Except for extraordinary situations, consideration will not be given new start reprogramming

requests for which the follow-on funding is not budgeted or programmed. Funding for new starts

may not be obligated without prior approval or written notification (see paragraphs 060403 and

060404). A program effort in one year in the Procurement and RDT&E accounts may be extended

into a subsequent fiscal year without constituting a new start. This is considered an extension of

the effort initiated in the prior year program, and could include a skip year for execution purposes.

When this occurs, the program should be footnoted as such on the DD 1416, Report of Programs,

with sufficient justification for the extension. Due to the characteristics of Military Personnel and

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Operation and Maintenance programs, new starts seldom occur in those appropriations. New starts

in these appropriations would be significant new programs, efforts, or activities that have not been

explicitly justified to the Congress in budget justification material. An example would be the

establishment of a Pacific Distribution System. In some instances, a letter notification may be

appropriate in these circumstances but only with the explicit approval of the USD(C).

The DD 1415-1 should include a brief description of the total program being initiated, and of the

total cost of the program and of proposed funding and procurement quantities by fiscal year. It

should provide enough background information to demonstrate that the item is ready for research

or procurement include explanation as to why the program must be initiated now and, if a budget

line is not already included in a budget currently under Congressional consideration, an

explanation of how subsequent years’ funding will be provided. The Department will not approve

new starts that do not have budgeted or programmed follow-on funding. The DD 1415-1 must

also explain why the source funds are no longer needed and any impact. See paragraph 060404

for failure to provide proper notification.

4.1.6. Terminates Appropriated Programs:

4.1.6.1. Eliminates a procurement program, or a subprogram, of $20 million or

more.

4.1.6.2. Eliminates a RDT&E program element, project, or subproject of

$10 million or more.

See paragraph 060403D for terminations falling within below-threshold limits.

4.1.7. Use Proceeds for Replacement of Certain Items Sold from Inventory. Prior

congressional approval obtained using a DD 1415-1 is required when proceeds from items sold

from inventory are used to acquire an asset that is not a “like replacement” item (e.g., that is not

of identical type, model, and series designation). Such requests may be included either as a

separate part within the monthly reprogramming, or submitted as a separate, stand-alone

DD1415-1 action. See section 0609 for additional information and guidance.

4.2 Internal Reprogramming Actions (060402)

DD 1415-3, Internal Reprogramming, actions are audit-trail type actions processed within

the Department to serve various needs. One is to reclassify funds for proper execution into a

different line item, program element, or appropriation than that in which the funds were

appropriated. Another includes reprogramming to or from transfer accounts. A third reflects

approval to increase quantities, when not otherwise requiring prior approval of the congressional

committees.

4.2.1. Reclassification Actions. In certain instances, it is necessary to reclassify funds to

a different line item, program element, or appropriation than that in which the funds were

appropriated by the Congress. Such reclassifications do not involve any change in the substance

of the program; the funds will be used for the same purposes originally contemplated and budgeted

for, testified to, and described in the justifications submitted to the congressional committees, and

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subsequently appropriated by the Congress. These actions may also involve realignment of

congressionally added programs that are more appropriately executed in a different program line

or in a different account than the line or account in which the funds were appropriated. In cases

where the realignment is between DoD appropriations, then the use of general transfer authority

would be involved, along with the legal requirements thereof.

4.2.2. Transfer Appropriations. Transfer accounts are those appropriations with funding

that will be subsequently transferred to other appropriations for execution. These accounts include,

but are not limited to: Environmental Restoration, Army; Environmental Restoration, Navy;

Environmental Restoration, Air Force; Environmental Restoration, Defense-Wide; Environmental

Restoration, Formerly Used Defense Sites, Drug Interdiction and Counter-Drug Activities,

Defense; Overseas Contingency Operations Transfer Fund; Foreign Currency Fluctuations,

Defense; and Foreign Currency Fluctuations, Construction, Defense. Movement of funds from

these accounts to other appropriations is generally exempt from the use of general transfer

authority.

4.2.3. Procurement Quantities. Approval for increases to procurement quantities for major

end items, not otherwise requiring prior approval of the congressional committees.

4.3 Letter Notifications to Congress (060403)

Letter notification to the congressional committees is required in advance of initiating

requirements for:

4.3.1. A new procurement line item not otherwise requiring prior approval action.

4.3.2. A new procurement line item or major component thereof costing less than

$20 million for the entire effort.

4.3.3. Establishment of new development programs costing less than $10 million for the

entire effort.

4.3.4. Initiation of safety programs or safety modifications costing less than $20 million

for the entire effort; can be initiated immediately following congressional notification.

4.3.5. Termination of programs falling within the below threshold reprogramming

amounts (procurement programs or subprograms costing less than $20 million; RDT&E programs,

projects, or subprojects costing less than $10 million) as long as the procurement line item or

RDT&E program element is not eliminated.

4.3.6. Identification of specific line items to satisfy specific transfer notification

requirements established by Congress.

Congress requires a 30-day notification to the Defense Committees prior to

implementation. The Component may implement the reprogramming action 30-days after

congressional notification unless an objection is received from a committee.

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4.4 Failure to Provide Proper Notification (060404)

Recurring general provisions in DoD Appropriations Acts (e.g., section 8077 of division C

of Public Law 113-235, the Department of Defense (DoD) Appropriations Act, 2015) prohibit use

of funds made available through a reprogramming that creates or initiates a new program, project,

or activity unless such program, project, or activity must be undertaken immediately in the interest

of national security and only after written prior notification to the congressional defense

committees.

4.5 Transfer Authority (060405)

Any movement of funds between appropriations or legal subdivisions requires transfer

authority. There are at least five types of transfer authorities:

4.5.1. Transfer Appropriations. Authority for Transfer Fund appropriations is contained

in the annual DoD Appropriations Act.

4.5.2. Foreign Currency Fluctuations. Authority for the Foreign Currency Fluctuations,

Defense, appropriation is contained in Public Law 95-457 (92 Stat. 1236) and section 2779 of

Title 10 of the U.S.C. Authority for the Foreign Currency Fluctuations, Construction, Defense,

appropriation is contained in section 121 of Public Law 99-591, section 2779 of Title 10, U.S.C.,

and the annual Military Construction Appropriations Act.

4.5.3. General Transfer Authority (GTA). The use of GTA is required for transfers

between appropriations and legal subdivisions, when other specific authority is not provided. It is

included in a general provision in the annual DoD Appropriations Act and is authorized in the

annual National Defense Authorization Act, most recently section 8005 of division C of

Public Law 113-235, the DoD Appropriation Act, 2015, and section 1001 of the annual

National Defense Authorization Act for FY 2015, Public Law 113-291. When GTA is used, the

Secretary of Defense must make a determination that such action is necessary in the national

interest. The OMB must also approve the use of GTAs. For prior approval reprogramming actions

that use GTA, OMB must approve transmittal of the action before the Department forwards to the

congressional defense committees. The OMB apportions funds that use GTA after congressional

approval is received for prior approval actions or the internal reprogramming action has been

approved and signed by USD(C). Beginning with the DoD Appropriations Act, 2009, recurring

general provisions have incorporated into law the funding levels specified in certain tabular entries

in appropriations act explanatory statements or conference reports (e.g., section 8006 of the

DoD Appropriation Act, 2015). Such recurring general provisions provide that where funding

levels specified in Project Level Adjustment Tables for a particular program, project, or activity

exceed the amount requested, that program, project, or activity must be carried out at the prescribed

level. Amounts specified in such project level adjustment tables are not subdivisions of

appropriations for purposes of GTA, and may be transferred or reprogrammed after appropriate

congressional notification. Any transfers among military personnel appropriations shall not be

taken into account for purposes of the limitation on the amount of funds that may be transferred

under GTA.

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4.5.4. Intelligence Programs. Authority for transfers in intelligence programs is specified

in paragraph 060601.

4.5.5. Special. Additional transfer authority for special situations is contained in various

sections of Title 10 of the U.S.C. and in annual National Defense Authorization and

Appropriations Acts. Section 127a of Title 10, U.S.C., provides limited transfer authority in the

case of certain operations. Use of this transfer authority requires the use of prior approval

reprogramming procedures.

4.6 Detailed Instructions and Formats for Preparation of DD 1415 (060406)

Detailed instructions for DD 1415-1 (Prior Approval) and DD 1415-3 (Internal

Reprogramming) are provided in the appendices to this chapter. Templates are available by

contacting the OUSD(C) P&FC reprogramming point of contact at 703-697-0022

(DSN 227-0022).

4.7 Submittal by Components (060407)

Military Departments must submit proposed DD 1415 actions formally by a signed

memorandum addressed to the USD(C) from the Assistant Secretary (Financial Management and

Comptroller) of the Military Department. Requests from a Defense Agency must be signed by its

Comptroller (or equivalent official). Such requests must be submitted electronically, and all

requests are due the 5

work day of the month for inclusion in the monthly reprogramming

submission. When a prior approval reprogramming for investment programs is required to initiate

a new start (paragraph 060401E) or to terminate a program (060401F), a copy should also be

provided to the Office of Under Secretary of Defense for Acquisition, Technology and Logistics;

Director, Acquisition Resources & Analysis. For all reprogramming actions, the DD 1415 must

be submitted to OUSD(C) P&FC, through the EFD system. The classified details must be

provided at the same time in an electronic submission to OUSD(C) via the SIPRNET. The

OUSD(C) will ensure that proposed reprogramming actions affecting the NIP resources are

provided to the Office of the Director for National Intelligence (ODNI). The OUSD(C) will ensure

will ensure that proposed reprogramming actions affecting MIP resources are provided to the

Undersecretary of Defense (Intelligence), and consistent with section 102A(d)(1)(B) of the

National Security Act of 1947 (50 U.S.C.§ 3024(d)(1)(B)) shall consult with the ODNI Office of

Chief Financial Officer before transferring or reprogramming funds made available by Congress

specifically for the MIP. The DoD Component memorandum shall include the following:

4.7.1. Reprogramming actions outside the Omnibus reprogramming to the congressional

committees, will only be made for those actions involving critical requirements or unforeseen

circumstances that cannot wait for implementation of the Omnibus due to contract award dates or

other time sensitive reasons. In these cases, individual reprogramming actions will be entertained,

and the transmittal memorandum must clearly define the urgency of the requirement. Ordinarily,

such urgent requirements shall be combined for inclusion in a monthly reprogramming submission

the congressional committees.

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4.7.2. A statement that the DD 1415–1 Prior Approval reprogramming action has been

cleared by the DoD Directorate for Freedom of Information and Security Review, Washington

Headquarters Services. The copy with the original “Cleared for Open Publication” stamp should

accompany the transmittal memorandum.

4.7.3. Because the DD 1415 actions are now being posted on the Comptroller’s Home

Page on the World Wide Web, the DD 1415 reprogramming action should not refer to or identify

the intelligence resources. Therefore, the cover letter transmitting the DD 1415 to the OUSD(C)

must contain a statement that the reprogramming does or does not affect MIP or NIP resources. If

NIP resources are affected, the reprogramming should be cleared with the ODNI, and the cover

letter should state that this has been done.

4.7.4. Identification of any new starts being requested, and whether the new starts were

approved by a Secretary’s decision document during the Program/Budget review or other action.

4.8 Signed DD 1415s (060408)

The USD(C) has the authority to sign all reprogramming actions, and upon signature the

reprogrammings are returned to OUSD(C) P&FC for further processing. A DoD Serial Number,

in sequence, will be added to the signed DD 1415.

4.9 OMB Approval (060409)

Any reprogramming action using general transfer authority and/or special transfer

authority must have a Secretary of Defense Determination documenting that the transfer is

necessary in the national interest. The authority to make that determination has been delegated to

the OUSD(C), Deputy Comptroller, Program/Budget. For prior approval reprogramming actions

using general transfer authority and or special transfer authority, OMB must also approve the

transmittal of the DD 1415-1 before forwarding the action to the congressional defense

committees. The OUSD(C) shall obtain formal OMB apportionment for the specific transfer of

funds after congressional responses on the action are received and final results on implementation

of the action are determined.

4.10 Distribution of the DD 1415-1 (060410)

The DD 1415-1 is e-mailed to the House Appropriations Committee (HAC), House Armed

Services Committee (HASC), Senate Appropriations Committee (SAC), and Senate Armed

Services Committee (SASC). A copy of the DD 1415 and the transmittal date will be

e-mailed to the submitting DoD Component. After being notified that the DD 1415 has been

submitted to the congressional committees, the DoD Component will ensure that the congressional

committees receive any classified information that is to be submitted under separate cover.

4.11 Congressional Committee Approval of DD 1415 Requests (060411)

4.11.1. Approval for a Prior Approval Reprogramming Action (DD 1415-1) is obtained

by letter from the congressional committees prior to implementation of the action. Each separate

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committee response is taken into account, and final implementation by OUSD(C) P&FC of the

action reflects the lowest of the approvals received for proposed sources and increases.

Occasionally the action is implemented for less than originally requested due to the denial of

increases or sources.

4.11.2. As copies of the congressional committee approval letters are received,

e-mail notification will be made to the applicable DoD Components and OUSD(C), Deputy

Comptroller, Program/Budget appropriation managers. When the final committee approval has

been received, an OUSD(C) P&FC implementation memorandum will be prepared.

The implementing letter will attach copies of the approved DD 1415, data sheets, Secretary of

Defense Determination, and committee letters, as applicable.

4.11.3. No reprogramming request will be approved if the funds requested have been

obligated or committed prior to congressional committee review and approval. The obligation of

funds prior to consideration by the congressional defense committees denies them a realistic option

to deny the request. Such a procedure places the committee(s) in the position of having to approve

the request or deny all funds for the continuation of the program in the latter part of the fiscal year.

Also, funds that have already been identified for a below-threshold reprogramming should not be

incorporated into the DD 1415 unless the funds have not yet been obligated on the new

requirement. (If this occurs, the funds cannot be obligated until congressional approval is

received).

4.11.4. Reprogramming hearings, questions, and transcripts will be handled by each

Component involved, unless there is an OSD principal witness.

4.11.5. If the congressional committees have denied a reprogramming increase, DoD

policy prohibits use of a series of below-threshold reprogramming actions as a means to finance

the requested increase. However, below-threshold reprogramming authority may be used to

finance increases on reprogramming actions that were approved by the congressional committees,

but were not able to be accommodated within the implementation process, as long as the below-

threshold reprogramming actions otherwise do not: exceed a threshold limitation, such as below-

threshold reprogramming limitations on realignment of funds into or out of a budget line; affect

an item of special congressional interest item; or have not been specifically denied by a

congressional committee as a reprogramming source. This policy has evolved out of recognition

of there being congressionally-approved increases within monthly and Omnibus reprogramming

actions that were unable to be funded in the USD(C) implementation memorandum, due to a lack

of congressionally-approved sources. However, in recent years, Components have been required

to provide advance written notification to the congressional defense committees prior to the

USD(C) undertaking a below-threshold reprogramming to implement approved sources.

4.12 Implementation Memorandums for Reprogramming Actions. (060412)

4.12.1. After all approvals have been obtained for a reprogramming action, a

memorandum signed by the Director for Program and Financial Control will be provided to the

applicable Components.

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4.12.2. If the reprogramming action includes an appropriation transfer, the implementing

memorandum will include instructions (data sheet) for processing the SF 1151, Nonexpenditure

Transfer Authorization, and include a copy of the combined Secretary of Defense Determination

and OMB Approval document approving the transfer.

4.12.3. Along with normal distribution, the implementation memorandum will be e-mailed

to the applicable DoD Component and to the appropriate OUSD(C), Deputy Comptroller,

Program/Budget appropriation manager(s), so that funds may be released.

4.13 Alternate Letters or Revised Actions for New Sources (060413)

4.13.1. Reprogramming actions may be submitted prior to or after the monthly or

Omnibus Reprogramming Actions. When sources are denied by a congressional committee, new

sources to fund the requested increase may be submitted in DD 1415 format or letter format.

Except in the most unusual circumstances, alternate sources for items denied in the monthly or

Omnibus Reprogramming Action will not be submitted to the congressional committees.

4.13.2. Revised actions or letters for the signature of the USD(C) should be prepared by

the submitting DoD Component. Normal reprogramming procedures apply for processing the

revised actions or letters to the congressional committees.

4.13.3. The committees have request that the original reprogramming request be furnished

when identifying a new source of funds.

The USD(C) may appeal the decision of a committee on a reprogramming action. All

proposed appeals to committees initiated by a DoD Component shall be forwarded by

memorandum to the USD(C) for further processing within the Department. Any action on a

reprogramming subsequent to its original submission to the committees is subject to the same

procedures as the original reprogramming.

4.14 Withdrawal of Reprogramming Actions (060415)

4.14.1. When approval of a reprogramming action that was submitted to the congressional

committees, but not fully approved, is no longer required, then that action should be formally

withdrawn from congressional committee consideration. The need for withdrawal may result

when too much time has elapsed for the proposed increase to go under contract or when proposed

sources are needed to fund a higher priority reprogramming than that originally submitted.

4.14.2. Withdrawal letters for the signature of the USD(C) should be prepared by the

submitting DoD Component. Normal reprogramming procedures apply for processing the letters

to the congressional committees.

4.14.3. Sufficient rationale on the reason for withdrawal should be provided to the

congressional committees so they will not question why the action was originally submitted for

their approval. If one or more committees have already approved the action, letters should be

written to those committees expressing appreciation for their approval.

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5.0 DD 1416, REPORT OF PROGRAMS (0605)

5.1 General (060501)

The DD 1416, Report of Programs, reflects the congressionally approved programs as

enacted, supplemental funding, rescissions, implemented reprogramming actions, congressionally

directed undistributed amounts and transfers, and below-threshold reprogramming actions that are

implemented by a DoD Component. The amounts on the DD 1416 for column should be identical

to the amounts on the DD 1002, Appropriation Status by Fiscal Year Program and Subaccounts,

column b (column d for Active Operation and Maintenance appropriations) for comparable “as of

dates” and stub entries. Amounts should only deviate when reconcilable differences exist due to

posting errors in the DD 1002.

5.2 Due Date (060502)

The DD 1416, Report of Programs is submitted quarterly 30-days after the end of each

quarter for Title III, Procurement, and Title IV, Research, Development, Test, and Evaluation, and

will include all implemented reprogramming actions through that date, together with below-

threshold reprogrammings made by the DoD Components through that date. The due dates for

these reports shall be approximately 30-days after the end of each quarter. The DoD Component

will certify their submission through the EFD system of the quarterly DD 1416, Report of

Programs, to OUSD(C), P&FC. The DD 1416 for Title I, Military Personnel, and Title II,

Operation and Maintenance, appropriations will be submitted annually, 30-days after the end of

the fiscal year.

5.3 Procurement Line Items “Items Less Than $5 million (060503)

“For programs that are included in an “Items Less Than $5 Million” line item, the program

or cost growth will be accommodated within the below-threshold authority for the total line item

value. The amount of growth to an individual program or to the aggregate line item total cannot

exceed the dollar threshold of $20.0 million or 20 percent, whichever is less.

5.4 Program Base Columns Reflecting Congressional Action (060504)

Changes due to supplemental appropriations and rescissions will be shown in a separate

column from the basic Appropriations Act. Additionally, general provision reductions that are to

be proportionately allocated to “each program, project, and activity” within each applicable

appropriation account will be reflected in this column. The combination of the “Program Base

Reflecting Basic Congressional Action” and “Program Base Adjustments Reflecting Enacted

Supplementals and Rescissions” columns shall be used for determining how much of the

procurement and RDT&E appropriations can be decreased based on percentages when determining

the amount that can be reprogrammed using below-threshold authority.

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5.5 Detailed Instructions for Preparation (060505)

Reimbursable program or order amounts are not required unless reimbursable funding was

used for the direct program. Detailed instructions for the DD 1416 are provided in the appendix

to this chapter.

6.0 REPROGRAMMING OF INTELLIGENCE RESOURCES (0606)

6.1 Intelligence Reprogramming Guidance (060601)

6.1.1. National Intelligence Program (NIP): Section 102A of the National Security Act of

1947 (50 U.S.C. 3024) authorizes the Director of National Intelligence (DNI) to transfer or

reprogram funds appropriated for a program within the National Intelligence Program (NIP) to

another NIP effort. No NIP funds may be transferred or reprogrammed without the prior approval

of the DNI, except in accordance with procedures prescribed by the DNI. For initiating and

processing reprogrammings involving the NIP, use applicable guidance issued by the Office of the

Director of National Intelligence (ODNI) Chief Financial Officer.

6.1.2. Military Intelligence Program (MIP): Reprogramming requirements set forth in

section 0604 apply to reprogramming MIP intelligence resources. Further policies specific to MIP

below-threshold reprogrammings are set forth in DoD Directive 5205.12, Military Intelligence

Program (MIP), enclosure 2, paragraph 1.i. Additionally, as provided for in paragraph 060407,

OUSD(C) will consult with the Office of the DNI Chief Financial Officer before transferring or

reprogramming funds made available by Congress specifically for the MIP as required by section

102A(d)(1)(B) of the National Security Act of 1947 (50 U.S.C.§ 3024).

6.2 Oversight (060602)

The House Permanent Select Committee on Intelligence (HPSCI) and the Senate Select

Committee on Intelligence (SSCI) have oversight jurisdiction over the NIP. All NIP

reprogrammings require prior approval from the HPSCI, SSCI, House Appropriations Committee

(HAC), and Senate Appropriations Committee (SAC). Reprogrammings affecting the MIP require

prior approval from the HPSCI, House Armed Services Committee (HASC), Senate Armed

Services Committee (SASC), HAC, and SAC. Notwithstanding that per agreements among the

various congressional committees the SSCI has jurisdiction over the NIP only, the Department

does provide the SSCI an information copy of reprogramming of

non-intelligence funds into the MIP in satisfaction of section 504 of the National Security Act of

1947 (50 U.S.C.§ 3094). Additionally, the Department provides the SSCI an information copy of

reprogramming actions within the MIP.

6.3 Submission Procedures (060603)

In addition, to applicable section 0604 procedures, including indication within cover letters

whether MIP or NIP resources are affected, the following additional requirements apply to

intelligence resource reprogrammings:

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6.3.1. Because DD 1415 reprogramming actions are posted on the Internet, the DD 1415

must not refer to or identify specific intelligence programs or resources.

6.3.2. All classified reprogramming requests must be coordinated with the Directorate for

Investment. Components are required to clearly identify classified actions as part of their

reprogramming submission. Concurrent with their reprogramming request submission,

Components are to separately provide; the classified details in electronic format to the appropriate

Comptroller POCs.

6.4 Procedures (060604)

The same procedures apply to reprogramming intelligence resources as provided in

paragraph 0604 with the following exception. For processing reprogrammings involving the NIP,

contact the Office of the Director of National Intelligence (ODNI) for specific guidance. Because

DD 1415 reprogramming actions are now being posted on the Internet, the DD 1415 must not refer

to or identify specific intelligence programs or resources. Cover letters transmitting proposed

DD 1415s to the OUSD(C) should contain a statement that the reprogramming does or does not

affect NIP/MIP resources.

6.5 Below-Threshold Reprogrammings (060605)

For processing below-threshold reprogrammings involving the NIP, contact the Office of

the Director of National Intelligence (ODNI) for specific guidance.

7.0 REPROGRAMMING OF SPECIAL ACCESS PROGRAMS (0607)

7.1 Provision in Law (060701)

The annual DoD Appropriations Act states: “Funds appropriated by this Act may not be

used to initiate a special access program without prior notification 30 calendar days in session in

advance to the congressional defense committees.”

7.2 General (060702)

For other than reprogrammings of new starts as stated in paragraph 060701, normal

reprogramming procedures as described in this chapter apply to special access programs.

8.0 BELOW-THRESHOLD REPROGRAMMING ACTIONS (0608)

8.1 Purpose (060801)

Below-threshold reprogramming actions provide DoD Components with the discretionary

flexibility to realign, within prescribed limits, and congressionally approved funding to satisfy

unforeseen, higher priority requirements. As with DD 1415 reprogrammings, below-threshold

actions must net to zero.

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8.2 Guidelines (060802)

8.2.1. Below-threshold reprogramming actions are minor actions not otherwise requiring

congressional approval that may be accomplished within the DoD Components and are measured

cumulatively over the entire obligation availability of the appropriation. Reprogramming

thresholds apply to increases and decreases made to line items in the Procurement and RDT&E

accounts. Below-threshold amounts for the Military Personnel are measured by increases as well

as Operation and Maintenance accounts are measured by increases and decreases. When the

congressional committees impose reprogramming thresholds on specific sub-activity group

categories, these threshold amounts are separately identified on the DD 1414, Base for

Reprogramming Actions, and reprogramming restrictions apply. Any action, when combined with

other below-threshold reprogramming actions for the same budget activity, line item or program

element, must not exceed the established threshold in total, except when thresholds are exceeded

due to the provisions of 31 U.S.C. 1551 et seq.

8.2.2. Threshold amounts agreed upon among the committees and the Department are

contained in paragraph 060401D. New start programs cannot be initiated using below-threshold

authority (see paragraphs 060401E and 060404).

8.2.3. Normal reprogramming thresholds will not apply based on 31 U.S.C. 1551 et seq.

when currently available appropriations are used to fund obligations or adjustments to obligations,

which would otherwise have been funded from a canceled account before it was canceled. Within

an appropriation, reprogramming thresholds may be exceeded in currently available appropriations

for increases or sources used to finance the “Canceled Account Adjustments” line item. If

reprogramming thresholds are exceeded for increases or sources to finance these obligations or

adjustments to obligations, then column “k,” “Below-Threshold Actions not Requiring Approval

by the SECDEF or Committees” of the DD 1416 should be footnoted to indicate that the threshold

amount has been exceeded due to canceled account adjustments.

8.2.4. If the congressional committees have denied a reprogramming increase, DoD policy

prohibits the use of a series of below-threshold reprogramming actions to finance the requested

increase. However, below-threshold reprogramming actions that preceded the congressional

denial will be recognized as valid.

8.2.5. Below-threshold reprogramming authority may be used to finance increases on

reprogramming actions that were approved by the congressional committees, but were not able to

be accommodated within the implementation process, as long as the below-threshold

reprogramming actions otherwise do not exceed below-threshold reprogramming limitations on

realigning funds into or out of a program line; affect an item of special congressional interest item;

or have not been specifically denied by a congressional committee as a reprogramming source.

This policy has evolved out of recognition of there being congressionally-approved increases

within monthly and Omnibus reprogramming actions that were unable to be funded in the USD(C)

implementation memorandum, due to a lack of congressionally-approved sources. However, in

recent years, Components have been required to provide advance written notification to the

congressional defense committees prior to the USD(C) undertaking a below-threshold

reprogramming to implement approved sources.

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8.2.6. The below-threshold authority computation starts with the quantity of end items and

amount of funds appropriated to a specific line item by the Congress. These baseline amounts are

reflected in columns h and i on the DD Form 1414, Base for Reprogramming Actions; in the BTR

column on the DD Form 1416, Report of Programs. The baseline is changed by supplemental

appropriations, rescissions, directed general provisions reductions, and approved DD 1415

reprogramming actions, which are reflected in the appropriate columns of the DD 1416. The net

amounts of the appropriated amounts and the supplemental appropriations, rescissions, directed

general provisions reductions, and approved DD 1415 reprogramming actions are reflected in

columns b, c, d, and e on all versions of the DD 1415. The first DD 1415 for a particular line item

will reflect the same baseline amounts in columns b/c and d/e. Subsequent DD 1415s for a

particular line item will retain the same baseline amount in columns b/c and d/e (unless a

supplemental or rescission or an approved DD 1415 has been implemented in the interim.

Exceptions to this occur when more than one DD 1415 is processed simultaneously, or when the

previous DD 1415 was implemented at a different level than was originally approved (Monthly or

Omnibus, for example).

9.0 REPLACEMENT OF ITEMS SOLD FROM INVENTORY (0609)

9.1 Policy (060901)

The current budget policy requires that offsetting collections from asset sales generally

cannot be used to replace end items sold from inventory if the replacement end item is not a “like

replacement” item of identical type, model, and series designation) unless congressional approval

is obtained. Although technically not involving the reprogramming of appropriated budgetary

resources, DoD obtains the requisite approval by submitting a prior approval reprogramming

action to the congressional defense committees.

9.2 Guidelines (060902)

9.2.1. The requirement for a prior approval reprogramming action for small dollar value

end items where replacements vary only to a minor extent from the item sold has resulted in

unnecessary paperwork and serves no substantive purpose. Replacement of items sold from

inventory with a unit cost of less than $5,000 that are not of identical type, model, and series

designation will be treated as a “like replacement,” if an improved model of the same end item is

being procured, performs the same warfighting capability, and the inventory objective presented

to the Congress is not exceeded. Items satisfying all of these criteria will be financed with the

proceeds of the sale of the end items issued from inventory without processing a DD 1415-1, prior

approval reprogramming request. The amount applied toward the like replacement item may not

be increased beyond the proceeds of that sale.

9.2.2. The requirement for a prior approval reprogramming action exists when an item of

materiel is sold which will require replacement to compensate DoD inventories for the resultant

loss of capability or readiness and the replacement item will not qualify as like replacement item

because it is not identical to the item sold. Replacement items submitted for congressional

approval must, however, be a later series or modified version of the same basic model of the item

being sold (e.g., sale of a C-130A aircraft and purchase of a C-130E), or be an acceptable substitute

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item used against the same inventory objective or authorized acquisition objective in requirements

computations (e.g., sale of an M-48 tank and purchase of an M-60 tank). If congressional approval

is provided, offsetting collections from the asset sale may be used to procure the item as a like

replacement item. See paragraph 070302.C.2 of Chapter 7 of Volume 15 for more information

concerning replacement of items following sales of Defense articles from stocks. In accordance

with OMB Circular A-11, section 83.5, the buyback of the like replacement items must be

classified as a direct obligation because it is financed using an offsetting collection from an asset

sale to a non-Federal source.

9.2.3. For DD 1415-1 reprogramming actions seeking approval for use of proceeds to

acquire items that are not “like replacement” items, Components must either submit a separate,

stand-alone prior approval reprogramming request, or make the request as a separate, stand-alone

part within the regular monthly reprogramming submission. Components shall not incorporate or

combine such actions with other types of reprogramming requirements.

10.0 REPROGRAMMING POLICY FOR CLOSING APPROPRIATION ACCOUNTS

(31 U.S.C. 1551 et seq) (0610)

10.1 Definitions of Contract Changes for Reprogramming Purposes (061001)

For purposes of this reprogramming policy guidance, adjustments to amounts initially

obligated in accounts that now are expired are categorized either as within-scope or change-in-

scope contract changes. Within-scope changes generally are funded from the appropriation that

originally financed the contract until cancellation. Change-in-scope contract changes are financed

from appropriations currently available for obligation at the time the change is made. Specific

guidelines for determining scope of work changes are defined in Chapter 8, “Standards for

Recording and Reviewing Commitments and Obligations”.

10.2 Use of Currently Available Appropriations to Fund Out-Of-Scope Contract Changes

(061002)

10.2.1. Normal applicable reprogramming (DD 1415) procedures and thresholds will

apply when currently available appropriations are used to fund out-of-scope contract changes.

10.2.2. Out-of-scope contract changes funded from currently available appropriations will

be funded from, and reflected against, the current corresponding line item, program element or

program applicable, or comparable, to the program for which the contract change is being made.

10.2.3. If an applicable corresponding program no longer exists in the currently available

appropriation for the program for which the out-of-scope contract change is being made, a new

line item for the program in question will be created to reflect the contract change adjustment.

Reprogramming threshold procedures for newly created line items will be the same as for the

creation of any other new line item.

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10.2.4. Any line item or program can be the funding source for contract changes funded

from currently available funds. However, the funding source line item or program will also be

subject to normal reprogramming thresholds.

10.3 Use of Currently Available Appropriations to Fund Obligations or Adjustments to

Obligations that Otherwise Would Have Been Funded from a Canceled Appropriation Account

(061003)

10.3.1. Obligations and adjustments to obligations that would have been properly

chargeable to a closed account, both as to purpose and amount, shall be charged to an appropriation

currently available for the same purpose. Specific limitations are as follows:

10.3.1.1. The sum of all such amounts funded from currently available

appropriations shall not exceed the lower of (a) one percent of the originally appropriated amount

of the current appropriation being charged or (b) the current unexpended balance of the canceled

appropriation account.

10.3.1.2. For the purpose described in paragraph 1, the unexpended balance is the

sum of the unobligated balance plus the unliquidated obligated balance of the appropriation

account at the time it was canceled, less any and all obligations incurred and payments made

subsequent to the cancellation of the original appropriation account when such obligations and

payments would otherwise have been properly charged to the appropriation had the appropriation

not been canceled.

10.3.2. Normal reprogramming procedures (DD 1415) and thresholds will not apply when

currently available appropriations are used to fund obligations or adjustments to obligations, which

would otherwise have been funded from a canceled appropriation account before it was canceled.

10.3.3. Charges to currently available appropriations for obligations or adjustments to

obligations that would otherwise have been charged to canceled appropriation accounts shall be

reflected in a line item on the Report of Programs (DD 1416) entitled “Canceled Appropriation

Account Adjustments.”

10.3.3.1. Within an appropriation, reprogramming thresholds may be exceeded in

currently available appropriations for increases or sources used to finance the “Canceled

Appropriation Account Adjustments” line item.

10.3.3.2. If reprogramming thresholds are exceeded for increases or sources to

finance these obligations or adjustments to obligations, column k, Changes not Requiring

Approval by Secretary of Defense, of the DD 1416 should be footnoted to indicate that the

threshold amount has been exceeded due to canceled appropriation account adjustments.

10.3.3.3. The new line, “Canceled Appropriation Account Adjustments,” will be a

separate line item or program element and added as an entry within a single budget activity. For

all appropriation accounts that do not display line item detail, a memo line shall be shown under

any single budget activity.

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10.4 Use of Expired Appropriations to Fund Contract Changes (061004)

10.4.1. An expired appropriation remains available for recording, adjusting and

liquidating obligations properly chargeable to that appropriation until the appropriation is closed

under 31 U.S.C. 1552. Accordingly, an expired appropriation may be used to fund within-scope

contract changes properly chargeable to that appropriation in accordance with Chapter 8. When

properly chargeable obligations are posted against a line item, funding must be available in that

program. If funding is not available on that program, but funding is available within the

appropriation, a funding realignment between programs in that appropriation must be

accomplished.

10.4.2. Expired Operation and Maintenance, Navy appropriations may be used to fund

certain payments required because of changes in scope of work in connection with ship overhaul,

maintenance, and repair work under 10 U.S.C. 7313.

10.4.3. For purposes of the Shipbuilding and Conversion, Navy, (SCN) appropriation,

appropriation language normally provides for additional obligations to be incurred after the 5 years

of obligation availability, for engineering services, tests, evaluations, and other such budgeted

work that must be performed in the final stage of ship construction. The period of availability of

the SCN appropriation is adjusted prior to being canceled based on the schedule of work being

performed. (e.g. section 8075 of division C of Public Law 113-235, the DoD Appropriations Act,

2015).

11.0 NATIONAL GUARD AND RESERVE EQUIPMENT APPROPRIATION

NOTIFICATION PROCEDURES (0611)

11.1 General (061101)

In the National Guard and Reserve Equipment Appropriation (NGREA), the Congress

typically appropriates funding in lump-sum amounts to be used for aircraft and miscellaneous

equipment, and requests submission of a detailed assessment of modernization priorities by each

of the Reserve Component (RC) Chiefs. The Assistant Secretary of Defense (Reserve Affairs)

(ASD (RA)) forwards the RC acquisition plans to the congressional committees, along with a

consolidated equipment requirements list for all Reserve Components, called the Summary

NGREA Acquisition Report.

11.2 Procedures for Revisions to the Summary NGREA Acquisition Report (061102)

11.2.1. Procurement of any item not included in the Summary NGREA Acquisition Report

for allocation of the funds appropriated in lump-sum amounts for aircraft and miscellaneous

equipment cannot be initiated by a Component until the proper notification to the congressional

committees is made.

11.2.2. Letters requesting a change to the initial report must be submitted to ASD(RA) by

the cognizant Military Department Assistant Secretary (Financial Management and Comptroller)

for the respective Reserve Component requiring a change from the initial allocation directly to the

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ASD(RA). The ASD(RA) shall obtain coordination from OUSD(C) P/B before transmitting letters

to the congressional committees.

11.2.3. Consistent with other procedures in place for letter notifications pertaining to new

starts (section 060403), the following procedures shall apply.

11.2.3.1. Notification of the House and Senate Appropriations Committees and the

House and Senate Armed Services Committees is followed by a 30-day automatic hold.

11.2.3.2. The DoD Component may implement the reprogramming 30 calendar

days after receipt by these committees unless notification to the contrary is received from a

committee.

*12.0 OPERATION AND MAINTENANCE QUARTERLY EXECUTION REPORT (0612)

*12.1 Purpose (061201)

This chapter provides instructions applicable to preparation and submission of the

Operation and Maintenance (O&M) Quarterly Execution Report. Congress requires the

Department to provide the congressional defense committees with quarterly budget execution data

for each of the active, guard, reserve, and defense-wide O&M accounts. Title 10, U.S. Code,

section 228, requires quarterly reports on the allocation of funds within operation and maintenance

budget sub-activities. The Operation and Maintenance Quarterly Execution Report satisfies both

reporting requirements.

12.2 Submission Requirements (061202)

The Military Departments submit their reports to the Office of the Under Secretary of

Defense, Comptroller (OUSD(C)), Operations Directorate 20 days after the end of each quarter.

The Defense Wide Operation and Maintenance Report is prepared by OUSD(C), Operations

Directorate. The template provided in an appendix B to this chapter displays the format for the

Report.

12.3 Preparation of Material (061203)

The O&M Execution Report must:

12.3.1. Reflect the official DD COMP (M) 1002 Report as of the last day of the reporting

quarter;

12.3.2. Explain any deviations from official budget data and accounting execution report

data.

12.3.3. Control funds at the SAG/BLI level to prevent reflecting obligations in excess of

program in the official DD COMP (M) 1002 Report; and

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12.3.4. Avoid exceeding SAG/BLI thresholds for prior approval reprogrammings as set

by Congress.

12.4 References (061204)

Volume 2A Chapter 1 provides general funding policies and Chapter 3 provides specific

policies related to Operation and Maintenance costs. (See Volume 2A, Chapter 1 – 3)

12.5 Operation and Maintenance Quarterly Execution Report Exhibit (061205)

12.5.1. The O&M Report contains the following column data as displayed on the format

presented in Appendix C to this chapter. Unless modified in a data call, this format should be

adhered to.

12.5.1.1. Appropriation: Use this column to identify the Component’s O&M

account and display as follows:

12.5.1.1.1. Army O&M (Active/Reserve/National Guard)

12.5.1.1.2. Navy O&M (Active/Reserve)

12.5.1.1.3. Marine Corps O&M (Active/Reserve)

12.5.1.1.4. Air Force O&M (Active/Reserve/National Guard)

12.5.1.1.5. Defense-Wide (D-W) O&M

12.5.1.2. Budget Activity (BA): Use this column to identify the applicable Budget

Activities such as:

12.5.1.2.1. Operating Forces (BA 1)

12.5.1.2.2. Mobilization (BA 2)

12.5.1.2.3. Training and Recruiting (BA 3)

12.5.1.2.4. Administrative and Servicewide Activities (BA 4)

12.5.1.2.5. Defense Agency and Budget Activity (Defense-Wide)

12.5.1.3. Activity Group (AG)/Budget Sub-Activity (BSA): Use this column to

display the activity groups.

12.5.1.4. Sub-Activity Group (SAG)/Budget Line Item (BLI): Use this column to

display the sub-activity group (SAG)/Budget Line Item (BLI) title.

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12.5.1.5. President’s Budget Request Column: This column must match the

current fiscal year budget request, by SAG/BLI, in the Conference Report for the Department of

Defense Appropriations and match the appropriate column in the Base for Reprogramming

Actions (DD 1414).

12.5.1.6. Appropriation Column: This column must match the current fiscal year

appropriation, by SAG/BLI, in the Conference Report for the Department of Defense

Appropriations and match the appropriate column in the Base for Reprogramming Actions

(DD 1414).

12.5.1.7. Distribution of Unallocated Congressional Adjustments: This column

should reflect the distribution of unallocated congressional adjustments found in the Conference

Report for the Department of Defense Appropriations.

12.5.1.8. Adjustments Required by Statute: The total for the Adjustments

Required by Statute column should equal the Transfers (i.e., letter reprogrammings directed by

statute), General Provisions, and Supplemental Appropriations.

12.5.1.9. Prior Approval Reprogramming: This column should reflect prior

approval reprogrammings. This should include all prior approval reprogrammings approved by

Congress by the end of the quarter that this report covers.

12.5.1.10. Below Threshold Reprogrammings (BTRs): This column should

include any reprogramming actions that the component has made between SAG/BLI s that do not

require OSD or congressional approval, also known as Below Threshold Reprogrammings (BTRs).

The BTRs must not exceed $15.0 million into/out of each Budget Activity (BA) or Defense

Agency. Additionally, the Explanatory Statement, Division C Department of Defense

Appropriations Act Fiscal Year 2015 cites specific SAG/BLI s that require prior approval

reprogramming and Defense Agencies and Components restricted to BTRs of the lessor of

$15 million.

12.5.1.11. Other Reprogrammings: This column should include any Internal

Reprogrammings (IRs) not displayed elsewhere in this report. Provide a footnote explanation for

these adjustments (i.e., includes environmental restoration and foreign currency fluctuation

transfers). Provide specific details for any adjustments other than adjustments from Transfer

accounts. For example, letter reprogrammings authorized but not specifically directed by statute

would appear in this column. The footnote would explain the transfer.

12.5.1.12. Current Program: This column must match, by SAG/BLI, Budget

Activity (BA) and in total, column D (column C for the Marine Corps Reserve, Navy Reserve, Air

Force Reserve, and Air National Guard) of the O&M Appropriation Status by Fiscal Year Program

and Subaccounts (DD 1002) Report for the last month of the applicable quarter. If it does not,

then present the appropriate total; provide a footnote explanation with specific SAG level detail

noting the discrepancy and address why it does not, and what action is underway to correct any

differences.

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12.5.1.13. Actual Obligations: This column must match, by SAG/BLI, Budget

Activity (BA) and in total, column E of the O&M Appropriation Status by Fiscal Year Program

and Subaccounts Report (DD 1002) Report for the last month of the applicable quarter. If it does

not, then present the appropriate total; provide a footnote explanation with specific SAG/BLI level

detail noting the discrepancy and address why it does not, and what action is underway to correct

any differences.

12.5.2. Footnotes:

12.5.2.1. Careful attention must be paid to report footnotes.

12.5.2.2. Use the footnote section to explain the data contained in the report and

make it meaningful;

12.5.2.3. Explain any deviations from official budget data and accounting

execution report data;

12.5.2.4. Be consistent with the wording of footnotes and ensure the current quarter

footnotes are consistent with the previous quarter’s report footnotes; and

12.5.2.5. Standard footnotes will be provided by the Office of the Under Secretary

of Defense (Comptroller) at the beginning of each fiscal year

12.5.3. Expectation for Funds Awareness

12.5.3.1. Funds should be controlled at the SAG/BLI level to prevent reflecting

obligations in excess of program in the O&M DD 1002 Report; and

12.5.3.2. Funds must be controlled to avoid exceeding SAG/BLI thresholds for

prior approval reprogrammings as set by Congress.

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ppendix A Part 4 – Report of Programs

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Appendix B – Operation and Maintenance Budget Execution Data