ALCOAST 015/19 - JAN 2019 GOVERNMENT PURCHASE CARD PROCEDURES DURING LAPSE, FAQs AND UPDATE ON BANK TRANSITION

R 241325 JAN 19
FM COMDT COGARD WASHINGTON DC//CG-91//
TO ALCOAST
UNCLAS//N07500//
ALCOAST 015/19
COMDTNOTE 7500
SUBJ: GOVERNMENT PURCHASE CARD PROCEDURES DURING LAPSE, FAQs AND UPDATE ON BANK TRANSITION
A. ALCOAST 429/18 CG CONTRACTING PROCEDURAL AND POLICY GUIDANCE DURING A LAPSE IN APPROPRIATIONS
B. ALCGFINANCE 050/18 FINANCIAL POLICY GUIDANCE DURING A LAPSE IN APPROPRIATIONS
C. ALCOAST 425/18 MISSION SUPPORT DELIVERY DURING A LAPSE IN APPROPRIATIONS
D. ALCOAST 424/18 CONTINUING OPERATIONS DURING A LAPSE IN APPROPRIATIONS
1. This ALCOAST is sent as a reminder of government purchase card (GPC) procedures and use
during the lapse, to provide answers to frequently asked questions (FAQs) and to update the bank
transition. In accordance with the GSA SmartPay 2 Master Contract, purchase cards will remain
operational and the servicing bank will continue to function as normal and provide services
in accordance with the master contract during a lapse in appropriations. During a lapse in
appropriations, purchase cards may be used only for functions and activities that are exempted
from work restrictions in the Anti-Deficiency Act (ADA). Exempted functions are those that are:
    A. Funded by Sources Other than Annual Appropriated Funds
    B. Authorized to Continue Even Without Funding
    C. Necessary for Safety of Human Life or Protection of Property
    D. Necessary for the Orderly Cessation of Functions
2. Although purchase cards remain operational in the event of a lapse in appropriations,
cardholders are reminded to confer with and receive approval from their unit regarding continued
use of the card due to the appropriation limitations described above. Additionally, only military
members and those civilian cardholders deemed "exempt personnel" may use their cards during a
lapse in appropriations. Please seek guidance from your chain of command if unsure of your status.
3. Purchases during the lapse can only be made IAW paragraph 1 above, which are authorized by the
Funds Manager and the Approving Official (AO) prior to purchase. If the AO is inactive due to the
lapse in appropriations, then approval must be obtained from the unit's alternate designated
authorized Approving Official. In compliance with the DHS Purchase Card Manual, all purchase limits,
purchase guidance, and restrictions will remain in full force and effect during a lapse in
appropriations. The Coast Guard will be required to provide justification for all obligations made
during a lapse in appropriations. Unit Commanding Officers, Officers in Charge, and supervisors
shall ensure that all unit obligations made during the lapse in appropriations are in support of
exempt missions. Routine purchases must be avoided. This bona fide need must be clearly cited,
recorded in the procurement documentation, and must be maintained for future review while ensuring
that all financial management internal controls are followed. If financial systems are not available
to record obligations, transactions will be entered into the systems when normal operations resume.
4. If cardholders experience problems during the lapse in appropriations, they may contact the
bank at 1-866-297-0781, which is also provided on the back of the card. If a card is due to expire
during the government shutdown, new cards will continue to be mailed by the bank to the cardholder's
address on file located in the servicing bank system (PaymentNet); however, if the card is returned
to the servicing bank, the card will be destroyed and notification will be sent to CG Headquarters.
CG Headquarters Purchase Card Support will be available via email in the event of a lapse in
appropriations to assist cardholders. For emergency assistance outside of regular business hours or
on weekends, please call 202-329-0932.
5. The following FAQs are provided on the use of the GPC during a lapse in appropriations:
    A. All funding not executed prior to 21 Dec 2018 has expired. There is no FY19 funding.
    B. You can only make GPC transactions for exempted missions.
       (1) Unit Commanding Officers, Officers in Charge, and supervisors shall ensure that all unit
obligations made during the lapse in appropriations are in support of exempt missions.
        (2) Each transaction must contain documentation in the file, for future review, supporting
the transaction is in support of exempted functions.
    C. Do not make GPC purchases for non-exempted functions; i.e., only make GPC purchases for bona
fide exempted functions outlined in REFs (A-D). Maintain documentation on the
determination that the transaction is to support the exempted mission clearly stated in REF (A).
As stated in REF (B), your Unit Commanding Officers, Officers in Charge, and
supervisors shall ensure that all unit obligations made during the lapse in appropriations are
in support of exempt missions.
    D. Is legal and Chief of the Contracting Office (COCO) approval required for exempted purchase
card transactions and if so what documents require it? No. Follow guidance in paragraph 3 above.
    E. If an action is funded and nonexempt (example cell phones have obligated 12 months in advance;
can we obligate (pay) via purchase card? Any Service Purchases that were fully obligated as of
21 December 2018, prior to a lapse of those funds, can continue to pay monthly service fees against
that original obligation. Those payments will not be liquidated by the Coast Guard, until appropriations
are made that allow us to pay invoices from the credit card company. If the full Service Purchase Order
was not obligated, and requires a new obligation in order to continue services, those new obligations
must be supporting an excepted mission.
    F. Is there a preferred manner to document purchase card transactions (i.e. via SharePoint)
to aide in a future audit? Follow guidance in paragraph 3 above.
    G. Purchase Card Application (PCA)? The majority of our cardholders are civilians who are furloughed
and their AOs are furloughed as well. How will this impact certifying our statements for the month of
January? For furloughed employees, PCA is considered a non-exempt function and will be handled after
the shutdown.
    H. Can FY18 bills be paid during the shutdown? Payment of invoices are a non-excepted activity...
no payments are being made during the shutdown except those described in question E.
    I. I’m getting close to a zero balance in my account, will I go ADA if I go past zero?
As of 22 December, the Coast Guard’s O&S balance is zero. Refer to paragraphs 1, 2, and 3 above on
making GPC purchases during the lapse.
    J. Exempt, non-exempt, or excepted?
Exempt: what is the funding SOURCE? This is any funding that is not lapsed. So for us, it is anything
other than FY19 appropriations. Exempt funding examples include all prior year PC&I, EC&R, and R&D funds
that are still active, as well as the Yard and Supply funds. These activities can continue. There is a
very important nuance however, for PC&I. While that funding source is exempt, all CG employees that
execute that funding are funded with FY19 lapsed funds and therefore forced to only work on excepted
missions (safety of life and protection of property) which out year contracting is not a part of. If an
activity or person is not sourced via exempt funding, that activity or person is non-exempt if they do
not fit within any authorized exception. Non-Exempt: This is funding that has lapsed. For us, that is
FY19 PC&I and O&S CR funding. This is where we get into what missions we can conduct for safety of life.
These missions are either excepted or not. Excepted: what is the ACTIVITY? If we are conducting an
essential activity for the safety of life, protection of property, or national security, we have an
exception to operate these functions and have explicit authorization under law to continue even without
funding. This is the activity that ties to the DCO and DCMS (REFs (C) and (D), with updates to follow)
that explain what missions we will continue to perform during the lapse of annual O&S funding that
normally pays for those activities. We can continue to obligate funding for the excepted missions
against our 901 accounts, but CANNOT pay any invoices. Now for the status of all CG employees.
Exempt employee: as mentioned above, this is anyone that is paid by non-lapsed funding. Examples are
EC&R, R&D, Yard and boating safety. Excepted employee: Military: all active duty (AD) military are
automatically considered excepted because of our entitlement to pay that is provided by 37 U.S.C. 204.
Within DHS policy, we have very unique authority that allows us to perform both excepted and exempt
activities. Therefore, in addition to the regular activities performed with O&S funding, active duty
military can perform non-lapsed (ie, exempt) PC&I contracting actions (if you have the appropriate
warrant authority). AD can also perform travel using non-lapsed PC&I for the purposes of the non-lapsed
PC&I program. Civilian: (if not funded by exempt source above) Since civilians do not have the same
entitlement that military has, they are required to be designated accepted or not due to the functions
they are performing. If they perform excepted functions, generally, they were not furloughed and
continue working. For example, a SAR controller is at the command center. They can ONLY perform their
excepted functions during the lapse, and because they were deemed excepted, they cannot perform exempt
activities. As a result, until we get permission from DHS to deem PC&I contracting actions mission
essential due to unacceptable asset delivery delays, our contracting officers (KOs) are not working on
PC&I type work.
    K. Can I issue a purchase card transaction against a procurement request (PR) that was entered into
the system (i.e. FPD, NESSS) prior to December 22, 2018? No. All PRs that were not processed prior to
11:59 pm on December 21, 2018 are no longer funded during a lapse in appropriations.
    L. How do I execute a P-Card transaction during the lapse in appropriations?
        (1) Obtain a new PR that specifically states that funds are approved in advance of appropriations
for an exempt mission.
        (2) Obtain a written justification from the Unit Commanding Officer or Officer in Charge
that specifically states that the requirement is in support of an exempt mission and is
necessary for the avoidance of imminent threat to the safety of human life or the protection of
property. The justification must directly connect to one of the exempt missions authorized in
REF (C) or REF (D). The justification must state that there are no internal military resources
that can perform the work or, for supplies, there are none available for use within the CG. This memo
also needs to be signed by the local comptroller.
        (3) IMPORTANT: In the description block of each PR, the following statement is mandatory:
"Performance under this contract has been designated in accordance with either REF (C) or REF (D)
(reference the paragraph that is applicable) as necessary for avoidance of imminent threat(s) to the
safety of human life or the protection of property and this work is exempt from the restriction under
31 U.S.C 1341, Limitations on Expending and Obligating Amounts, Against Creating an Obligation in
Advance of Appropriated Funds." Also, include FAR clause 52.232-18, Availability of Funds.
        (4) Ensure all documentation is included in your GPC file.
    M. Do I need legal review for P-Card transactions? No. However, you still need to include all
documentation as discussed in question 12.
    N. What if I made a purchase without any justification/documentation as stated above?
Purchases not approved and not determined exempt are in violation of the Anti-Deficiency Act (ADA).
    O. What is an ADA violation?
The ADA prohibits federal employees from:
        (1) Making or authorizing an expenditure from, or creating or authorizing an obligation
under, any appropriation or fund in excess of the amount available in the appropriation
or fund unless authorized by law. 31 U.S.C. § 1341(a)(1)(A).
        (2) Involving the Government in any obligation to pay money before funds have been
appropriated for that purpose, unless otherwise allowed by law. 31 U.S.C. § 1341(a)(1)(B).
        (3) Accepting voluntary services for the United States, or employing personal services not
authorized by law, except in cases of emergency involving the safety of human life or the
protection of property. 31 U.S.C. § 1342.
        (4) Making obligations or expenditures in excess of an apportionment or reapportionment, or
in excess of the amount permitted by agency regulations. 31 U.S.C. § 1517(a).
    P. What are the penalties for an ADA violation?
An employee who violates the ADA: “shall be subject to appropriate administrative discipline
including, when circumstances warrant, suspension from duty without pay or removal from office.”
Under the law, an employee who “knowingly and willfully” commits a violation shall be fined not
more than $5,000, imprisoned for not more than 2 years, or both. Contact your Acquisition Lawyer
for additional information.
    Q. Do we obligate P-Card transactions in FPD during a lapse in appropriations?
For supplies and services that have been authorized to continue, PRs shall be submitted to the
cognizant contracting office, subject to availability of funds, with estimated costs for the
performance period through 31 January 2019. The PRs will result in a commitment in FPD, enabling
tracking/visibility, but no obligations will be transmitted in the system by contracting.
    R. Does a new (non-exempt) p-card purchase have to go to the Commandant for authorization?
Non-exempted purchases are not authorized during the shutdown.
6. Current SmartPay 2 Government Purchase Cards with J.P. Morgan Chase (JPMC) were scheduled to
expire on November 29, 2018, as DHS transitioned to the SmartPay 3 contract with Citibank on
November 30, 2018. However, due to challenges with the transition, GSA approved an extension of the
SmartPay 2 contract to January 29, 2019. An additional extension has been granted based on the lapse
in appropriations. Current JPMC purchase cards shall be retained and used to make purchases through
February 27, 2019. Our new go-live date with Citibank is February 28, 2019. Refer to PURCHASE CARD
NOTICE (PCN) 1-10-2019 Bank Transition Dates Update on the GPC SharePoint Portal for specific
transition dates.
7. Please direct questions regarding this ALCOAST to Ms. Helen Dawson, COMDT (CG-9131),
Helen.F.Dawson@uscg.mil.
8. Mr. Eric Thaxton, Acting Head of Contracting Activity, sends.
9. Internet release is authorized.