UNOBLIGATED BALANCES

[Lenny Siegel <lsiegel@igc.org>]

USE IT OR LOSE IT

Tom Grumbly's memo points out an ongoing problem for managers 
of cleanup programs. Congress - and its staff - treats unobligated 
funds or uncosted balances as money not needed, and they take it 
away. In general, funds must be spent within the year of their 
appropriation. Even when appropriations span several years - as with 
the Base Realignment and Closure Account - departments are 
pressured to "use it or lose it."

Cleanup differs from other programs in at least two key ways. First, 
for major sites it is almost impossible to know the full/precise extent 
of requirements at the time that budgets are built, since both 
investigation and remediation activities bring both positive and 
negative surprises. Second, since regulators and the public are (at 
least in theory) consulted at each step in the process, timetables are 
subject to continuing revision.

Consequently, when pressured to obligate funds even when high-
priority projects aren't quite ready for action, departments are forced 
to fund lower-priority activities and/or risk missing legally grounded 
milestones or face funding cutbacks. In either case, high-priority 
and/or legally mandated projects are further delayed.

To promote sound management, funding schemes for cleanup should 
recognize the need for flexibility in both the quantity of timing of 
actual expenditures.