WASHINGTON – ?A Government Accountability Office report released today identified improvements needed to better manage the Justice Department’s unobligated funds, which can be used to offset the agency’s reported budgetary authority. The report, requested by Senator Chuck Grassley of Iowa, Chairman of the Senate Judiciary Committee, recommended regular analyses of carryover balances of unobligated funds and a  more transparent accounting of how funds collected for certain programs are used. Some carryover funds are double-counted as discretionary spending credits in multiple fiscal years. The DOJ’s 2016 budget request uses these credits as a gimmick to actually spend nearly twice as much as the agency’s reported bottom line budget number. 

“The Justice Department’s alternative funding streams are designed to reduce the agency’s burden on the taxpayer, not to grow a slush fund and certainly not to disguise the agency’s budgetary authority through double-counting of offsets. The department needs to adopt a more transparent and responsible management of this funding to ensure that the needs of important programs are being met, and agency spending is accurately recorded,” Grassley said.

Along with taxpayer-funded appropriations, DOJ funds its programs through collections of fines, fees and penalties.  These alternative funds are subject to limits on how they can be used. Collections in excess of statutory limits create an unobligated balance that can be carried over from year to year, and used to offset the agency’s discretionary spending for budgetary purposes. 

The report found that DOJ doesn’t always estimate projected collections or develop future year reserves for certain funds, nor does it reveal how some alternative funds are being used. As a result, DOJ resources are not being used as effectively as possible. The same temporarily rescinded unobligated funds that are carried over from previous years can be counted as offsets in multiple fiscal years, creating a budgetary gimmick that understates the agency’s real discretionary spending authority. The report states that, because of these offsets from unobligated funds, DOJ reported a 36 percent decline in net discretionary spending authority from 2009 to 2013, while its actual discretionary spending authority remained relatively consistent.

The GAO report is available here.