Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-10-01304/USCOURTS-caDC-10-01304-0/pdf.json

Parties Involved:
Federal Labor Relations Authority
Respondent
United States Department of the Navy
Petitioner

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 20, 2011 Decided January 13, 2012

No. 10-1304

UNITED STATES DEPARTMENT OF THE NAVY,

NAVAL UNDERSEA WARFARE CENTER DIVISION 

NEWPORT, RHODE ISLAND,

PETITIONER

v.

FEDERAL LABOR RELATIONS AUTHORITY,

RESPONDENT

On Petition for Review of an Order of 

the Federal Labor Relations Authority

Mark W. Pennak, Attorney, U.S. Department of Justice, 

argued the cause for petitioner. With him on the briefs were 

Tony West, Assistant Attorney General, and William Kanter, 

Attorney.

Rosa M. Koppel, Solicitor, Federal Labor Relations 

Authority, argued the cause and filed the brief for respondent.

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 1 of 20
2

Before: GINSBURG,

1 HENDERSON, and KAVANAUGH, 

Circuit Judges.

Opinion for the Court filed by Circuit Judge KAVANAUGH.

KAVANAUGH, Circuit Judge: This case turns on whether 

a government agency may provide employees with free 

bottled water even when safe and drinkable water is available 

from water fountains at their work sites. Under federal 

appropriations law, the answer is no.

In the mid-1990s, the Naval Undersea Warfare Center 

Division in Newport, Rhode Island, began providing 

employees with bottled water. It did so after an EPA report 

indicated that water fountains in some Navy buildings in 

Newport contained components manufactured with lead. 

Beginning in 2005, however, the Navy replaced the 

problematic water fountains, tested the tap water, and 

determined it safe to drink. The Navy then stopped providing 

bottled water; it did not negotiate with employee unions 

before removing the bottled water. The Navy reasoned that 

an agency has no duty or authority to bargain over or grant

benefits that are prohibited by federal appropriations law. 

And the Navy concluded that providing bottled water when

safe and drinkable tap water was available would violate the 

legal prohibition against use of appropriated funds for 

employees’ personal expenses.

The unions representing civilian employees at the 

Newport facilities objected to the removal of the bottled water 

and filed grievances with the Navy. When negotiations did 

not yield a compromise, the unions sought binding arbitration. 

An arbitrator sided with the unions and ordered the Navy to 

 1 As of the date this opinion was published, Judge Ginsburg 

had assumed senior status.

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 2 of 20
3

continue providing bottled water on the ground that bottled 

water had become a condition of employment. The Federal 

Labor Relations Authority – an independent government 

agency responsible for adjudicating federal labormanagement disputes – affirmed the arbitrator’s decision, 

holding that the Navy had a duty to bargain with the unions 

before removing the bottled water. The Navy petitioned for 

review in this Court.

Decisions of the Supreme Court and this Court have 

strictly enforced the constitutional requirement, implemented 

by federal statutes, that uses of appropriated funds be 

authorized by Congress. See U.S. CONST. art. I, § 9, cl. 7; 31

U.S.C. § 1301 et seq. Funds appropriated for agency 

operations may be used for “necessary expenses” but not for 

employees’ “personal expenses.” As the Comptroller General 

has long determined, when safe and drinkable tap water is 

available in the workplace, bottled water constitutes a 

personal expense for which appropriated funds may not be 

expended. Under federal collective bargaining law, 

moreover, an agency has no duty or authority to bargain over 

or grant benefits that are “inconsistent with any Federal law.” 

5 U.S.C. § 7117(a)(1). Therefore, if safe and drinkable tap 

water was available at the Newport facilities, the Navy had no 

authority or duty to bargain before removing the bottled 

water.

We therefore vacate the decision of the Federal Labor 

Relations Authority and remand this case to the Authority to 

determine whether the tap water is in fact safe to drink. If the 

Authority concludes that the tap water is safe to drink, the 

Authority must rule for the Navy.

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 3 of 20
4

I

The Naval Undersea Warfare Center Division in

Newport, Rhode Island, develops and supports submarine 

warfare systems for the U.S. Navy. Civilian employees at the 

Newport facilities are represented by two unions: (i) the 

National Association of Government Employees, Local R1-

134, known as NAGE, and (ii) the Federal Union of Scientists 

and Engineers, Local R1-144, known as FUSE. NAGE 

negotiated a collective bargaining agreement with the Navy; 

FUSE had a grievance procedure agreement with the Navy, 

but no collective bargaining agreement.

The Navy began providing bottled water at the Newport 

facilities in the mid-1990s after it discovered that water 

fountains in some buildings were manufactured with 

components containing lead. Beginning in 2005, the Navy

replaced those fountains with newer, lead-free models. The 

base command then re-tested the base’s tap water sources. In 

2006, after determining that the base’s tap water was safe to 

drink, the Navy stopped providing bottled water. The base 

commander sent out a base-wide email assuring staff that the 

tap water was safe. The email informed base personnel that 

federal appropriations law precluded the Navy from providing

bottled water given that safe and drinkable tap water was 

available.

The unions filed grievances under their negotiated 

dispute resolution procedures, arguing as relevant here that 

the Navy had a duty to bargain with them before removing the 

bottled water. When the grievances were not resolved 

through negotiation, the unions sought binding arbitration.

The arbitrator found that any change in the practice of 

providing bottled water “required conferring and negotiating 

between the parties bound by the Collective Bargaining 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 4 of 20
5

Agreement(s).” In re Arbitration Between Dep’t of the Navy, 

Naval Undersea Warfare Ctr., Div. Newport & FUSE/NAGE 

R1-144 & NAGE R1-134, FMCS Case No. 070330-55282-3, 

at 8 (June 19, 2008). The arbitrator declined to consider the 

Navy’s argument that federal appropriations law barred it 

from providing bottled water. The arbitrator said that looking 

to federal appropriations law “would be looking outside of the 

Collective Bargaining Agreement between the parties.” Id. at 

9.

The Navy filed exceptions to the arbitration award with 

the Federal Labor Relations Authority. See 5 U.S.C. 

§ 7122(a). As relevant here, the Navy challenged the award 

on the grounds that (1) the arbitrator refused to consider its 

argument that federal appropriations law precluded it from 

providing bottled water, and (2) the arbitrator’s findings drew 

no distinction between NAGE and FUSE, even though only 

NAGE had a collective bargaining agreement with the Navy. 

See Agency’s Exceptions to Arbitrator Jerome H. Wolfson’s 

June 19, 2008 Award & Opinion at 12, 15, 20, Dep’t of the 

Navy, Naval Undersea Warfare Ctr. Div. Newport, R.I., 64 

F.L.R.A. 1136 (2010).

The Authority denied the exceptions and affirmed the 

arbitrator’s conclusion that the Navy was obligated to bargain 

before removing the bottled water. Dep’t of the Navy, Naval 

Undersea Warfare Ctr. Div. Newport, R.I., 64 F.L.R.A. 1136, 

1138-40 (2010). The Authority agreed with the arbitrator’s 

determination that the Navy’s “provision of bottled water for 

many years was an established past practice” at the Newport 

facilities and thus a “condition of employment,” which the 

Navy could not change without bargaining with the unions. 

Id. at 1139. The Authority rejected the Navy’s argument that 

federal appropriations law precluded the Navy from supplying 

bottled water, stating that “[n]one of the Comptroller General 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 5 of 20
6

decisions . . . permits unilateral termination of a practice to 

provide bottled water.” Id. The Navy petitioned for review in 

this Court.

II

Before reaching the merits of the Navy’s arguments, we 

first consider whether we have jurisdiction to review the 

Authority’s decision. To simplify the jurisdictional question: 

If the Authority’s decision was based solely on the collective 

bargaining agreement between the Navy and NAGE, then we 

do not have jurisdiction. But if the Authority’s decision was 

based on the Navy’s statutory bargaining obligations, and not 

solely on the Navy’s obligations under the collective 

bargaining agreement, then we do have jurisdiction. We 

conclude that the Authority’s decision was based on the 

Navy’s statutory bargaining obligations, not on the collective 

bargaining agreement. We therefore have jurisdiction.

A

The Federal Service Labor-Management Relations 

Statute establishes a two-track system for resolving labor 

disputes between federal agencies and government employee 

unions. See Overseas Educ. Ass’n v. FLRA (OEA), 824 F.2d 

61, 62 (D.C. Cir. 1987). The first track permits a union 

alleging an unfair labor practice, as defined in 5 U.S.C. 

§ 7116, to file a charge with the General Counsel of the 

Federal Labor Relations Authority. The General Counsel 

must investigate the charge and may commence an 

administrative proceeding against the agency if the charge has 

merit. 5 U.S.C. § 7118(a)(1)-(2). The Authority’s resolution 

of a charge is subject to judicial review in the courts of 

appeals. 5 U.S.C. § 7123(a).

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 6 of 20
7

The second track – the track chosen by the unions in this 

case – is binding arbitration. Every collective bargaining 

agreement between an agency and a union must include a 

negotiated grievance procedure, and every grievance 

procedure must allow a party dissatisfied with the outcome of 

the grievance negotiations to opt for binding arbitration. 5 

U.S.C. § 7121(a)(1), (b)(1)(C)(iii). Once the arbitrator 

reaches a decision, either party may file exceptions to the 

arbitrator’s award with the Federal Labor Relations Authority. 

5 U.S.C. § 7122(a). The Authority reviews the arbitration

award to ensure that it is not “contrary to any law, rule, or 

regulation,” or otherwise deficient on any ground “similar to 

those applied by Federal courts in private sector labormanagement relations.” Id. 

An aggrieved party may elect either track – the statutory 

complaint procedure or binding arbitration – but not both. 5 

U.S.C. § 7116(d).

When the aggrieved party chooses the second track, the

Authority’s order resolving the exceptions to the arbitration

award is ordinarily not judicially reviewable. 5 U.S.C. 

§ 7123(a)(1). Insulating arbitration awards from judicial 

review reflects “a strong Congressional policy favoring 

arbitration of labor disputes” and furthers “Congress’s interest 

in providing arbitration results substantial finality.” Ass’n of 

Civilian Technicians, N.Y. State Council v. FLRA, 507 F.3d 

697, 699 (D.C. Cir. 2007) (internal quotation marks omitted). 

However, a narrow exception exists. Section 7123(a) 

provides:

(a) Any person aggrieved by any final order of the 

Authority other than an order under –

(1) section 7122 of this title (involving an award 

by an arbitrator), unless the order involves an 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 7 of 20
8

unfair labor practice under section 711[6]2

(2) section 7112 of this title (involving an 

appropriate unit determination),

of 

this title, or 

may, during the 60-day period beginning on the date on 

which the order was issued, institute an action for judicial 

review of the Authority’s order in the United States court 

of appeals in the circuit in which the person resides or 

transacts business or in the United States Court of Appeals 

for the District of Columbia.

Therefore, under Section 7123(a), an FLRA order reviewing 

an arbitration award is subject to judicial review if it 

“involves an unfair labor practice” under Section 7116.3

B

The Authority argues that its decision in this case is not 

subject to judicial review – that is, that the decision did not 

“involve” a statutory unfair labor practice – because the 

Authority’s opinion does not explicitly discuss a statutory

“unfair labor practice.” That argument contravenes this 

Court’s precedents. We have not interpreted Section

7123(a)(1) to depend on whether the Authority explicitly 

discussed a specific statutory unfair labor practice. Instead, 

“the standard is that a statutory unfair labor practice must be 

either an explicit ground for, or be necessarily implicated by, 

 2 The statutory text refers to “section 7118.” That reference 

“has been recognized to be an error; the correct reference is to 

section 7116.” OEA, 824 F.2d at 63 n.2.

3 Refusing “to consult or negotiate in good faith with a labor 

organization” constitutes a statutory “unfair labor practice” under 

Section 7116(a)(5). The statutory unfair labor practice at issue here 

is the Navy’s refusal to negotiate over a change to a condition of 

employment.

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 8 of 20
9

the Authority’s decision.” OEA, 824 F.2d at 67-68 (emphasis 

added) (footnote omitted). Where a successful claim could 

not possibly have been upheld based on the contract because 

the contract provided no ground for the Authority’s decision, 

the Authority’s decision necessarily implicates a statutory 

unfair labor practice. That is what happened here. 

For several reasons, it is apparent that the Authority 

derived the Navy’s duty to bargain over the removal of 

bottled water – that is, to bargain over a change to a condition 

of employment – from the statute, not from the collective 

bargaining agreement.

First, the Authority did not identify any provision of the 

collective bargaining agreement as creating a duty to bargain 

over the manner in which the Navy provided safe drinking 

water. Neither did the arbitrator. Our decision in National 

Treasury Employees Union v. FLRA (NTEU), the companion 

case to Overseas Education Association, provides a useful 

comparison. See 824 F.2d at 68. In NTEU, the union argued 

that the Customs Service had breached its “duty to bargain” 

by “failing to negotiate with respect to the changes in 

overtime practices.” Id. The union grounded its claim on its

collective bargaining agreement, which provided that “the 

Union has the right to bargain over the procedures which the 

Employer will observe in exercising its management rights 

authority.” Id. Because the union “affirmatively chose to 

invoke the agreement, not the statute,” the Court found that it 

did not have jurisdiction under Section 7123(a)(1), even 

though “the contractual provision at issue mirrors the Act.” 

Id. at 69. 

Here, by contrast, there is no contractual provision that 

“mirrors,” or even approximates, the statutory duty “to 

consult or negotiate in good faith with a labor organization.” 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 9 of 20
10

5 U.S.C. § 7116(a)(5). The only relevant provision of the 

NAGE Collective Bargaining Agreement is article 25, section 

6. That section requires the Navy to provide “high quality 

drinking and wash water facilities” but says nothing about 

bargaining over the manner in which the Navy fulfills that 

obligation – that is, by water fountains or bottled water. J.A. 

63.

Second, the Authority’s discussion of the “duty to 

bargain” over changed conditions of employment relies on its 

own case law discussing statutory unfair labor practices, not 

contractual grievances. The Authority’s order cites its prior 

decisions in DOL I and DOL II, see 64 F.L.R.A. at 1139, 

where it held that the Department of Labor committed a 

statutory unfair labor practice by failing to bargain over the 

removal of water coolers. See Dep’t of Labor (DOL I), 37 

F.L.R.A. 25, 36 (1990) (“[W]e conclude that DOL . . .

violated section 7116(1) and (5) of the Statute when they 

decided to remove and/or stop paying for the water coolers 

without giving the Union notice and an opportunity to bargain 

over the decision to do so.”) (emphasis added); Dep’t of 

Labor (DOL II), 38 F.L.R.A. 899, 910 (1990) (“The 

Respondent Violated Section 7116(a)(1) and (5) of the 

Statute”). The Authority’s reliance on its statutory unfair 

labor practice case law further demonstrates that it derived the 

Navy’s duty to bargain over the bottled water from the statute, 

not from any contractual provision.

Third, of the two unions that brought the initial 

grievances, only one – NAGE – even had a collective 

bargaining agreement with the Navy. The other – FUSE –

had negotiated a grievance procedure agreement (which it 

invoked in this case) but no collective bargaining agreement. 

With respect to FUSE, the Authority’s contention that the 

claim “was litigated solely as a contractual violation” is thus 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 10 of 20
11

illogical. FLRA Br. at 20. There simply was no contract on 

which the “duty to bargain” with FUSE could have been 

predicated.

The Authority’s decision necessarily involved a statutory 

unfair labor practice. Therefore, this Court has jurisdiction 

under Section 7123(a)(1).

III

We therefore proceed to the substantive question raised 

by the Navy’s petition: whether the Authority’s order 

compelling the Navy to provide bottled water at its Newport 

facilities is consistent with federal appropriations law.

A

The Appropriations Clause of the Constitution provides: 

“No Money shall be drawn from the Treasury, but in 

Consequence of Appropriations made by Law . . . .” U.S.

CONST. art. I, § 9, cl. 7. The Clause’s words convey a 

“straightforward and explicit command”: No money “can be 

paid out of the Treasury unless it has been appropriated by an 

act of Congress.” Office of Personnel Mgmt. v. Richmond

(OPM), 496 U.S. 414, 424 (1990) (quoting Cincinnati Soap 

Co. v. United States, 301 U.S. 308, 321 (1937)) (internal 

quotation marks omitted). The Clause protects Congress’s 

“exclusive power over the federal purse.” Rochester Pure 

Waters Dist. v. EPA, 960 F.2d 180, 185 (D.C. Cir. 1992). The 

power over the purse was one of the most important 

authorities allocated to Congress in the Constitution’s 

“necessary partition of power among the several 

departments.” THE FEDERALIST NO. 51, at 320 (James 

Madison) (Clinton Rossiter ed., 1961); see also id. NO. 58, at 

359 (James Madison) (“This power over the purse may, in 

fact, be regarded as the most complete and effectual weapon 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 11 of 20
12

with which any constitution can arm the immediate 

representatives of the people, for obtaining a redress of every 

grievance, and for carrying into effect every just and salutary 

measure.”). 

The Appropriations Clause is thus a bulwark of the 

Constitution’s separation of powers among the three branches 

of the National Government. It is particularly important as a 

restraint on Executive Branch officers: If not for the 

Appropriations Clause, “the executive would possess an 

unbounded power over the public purse of the nation; and 

might apply all its monied resources at his pleasure.” 3 

JOSEPH STORY, COMMENTARIES ON THE CONSTITUTION OF THE 

UNITED STATES § 1342, at 213-14 (1833); see also Cincinnati 

Soap Co., 301 U.S. at 321 (the Clause “was intended as a 

restriction upon the disbursing authority of the Executive 

department”); Reeside v. Walker, 52 U.S. 272, 291 (1851) 

(“However much money may be in the Treasury at any one 

time, not a dollar of it can be used in the payment of any thing 

not thus previously sanctioned. Any other course would give 

to the fiscal officers a most dangerous discretion.”). The 

Appropriations Clause prevents Executive Branch officers 

from even inadvertently obligating the Government to pay 

money without statutory authority. See OPM, 496 U.S. at 

416; see also Dep’t of the Air Force v. FLRA, 648 F.3d 841, 

845 (D.C. Cir. 2011).

Federal statutes reinforce Congress’s control over 

appropriated funds. See 31 U.S.C. § 1301 et seq.; see also 

Harrington v. Bush, 553 F.2d 190, 194-95 (D.C. Cir. 1977) 

(“This clause is not self-defining and Congress has plenary 

power to give meaning to the provision. The Congressionally 

chosen method of implementing the requirements of Article I, 

section 9, clause 7 is to be found in various statutory 

provisions.”) (footnote omitted).

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 12 of 20
13

Section 1301, known as the “Purpose Statute,” provides 

that appropriated funds may be applied only “to the objects 

for which the appropriations were made.” 31 U.S.C. 

§ 1301(a). Section 1341, known as the Anti-Deficiency Act, 

makes it unlawful for government officials to “make or 

authorize an expenditure or obligation exceeding an amount 

available in an appropriation” or to involve the Federal 

Government “in a contract or obligation for the payment of 

money before an appropriation is made unless authorized by 

law.” 31 U.S.C. § 1341(a)(1)(A)-(B). A government official 

who knowingly and willfully violates Section 1341(a) is 

subject to criminal penalties, including imprisonment. 31

U.S.C. § 1350.

Federal collective bargaining is not exempt from the rule 

that funds from the Treasury may not be expended except 

pursuant to congressional appropriations. Indeed, the statute 

governing federal labor relations explicitly relieves agencies 

of the duty to bargain over any matter that would be 

“inconsistent with any Federal law or any Government-wide 

rule or regulation.” 5 U.S.C. § 7117(a)(1). Therefore, under 

Section 7117, “a collective bargaining proposal is contrary to 

law, and hence not subject to bargaining, if it requires 

expenditure of appropriated funds for a purpose not 

authorized by law.” Air Force, 648 F.3d at 848 (quoting 

Ass’n of Civilian Technicians, P.R. Army Chapter v. FLRA

(ACT III), 534 F.3d 772, 776 (D.C. Cir. 2008)); see also Ass’n

of Civilian Technicians, P.R. Army Chapter v. FLRA (ACT II), 

370 F.3d 1214, 1217 (D.C. Cir. 2004). 

Congress’s control over federal expenditures is 

“absolute.” Rochester, 960 F.2d at 185 (internal quotation 

marks omitted). The Clause does not permit an agency, by 

contract with a union, “to authorize the expenditure of funds 

beyond what Congress has approved.” Air Force, 648 F.3d at 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 13 of 20
14

845; see also Ass’n of Civilian Technicians, P.R. Army 

Chapter v. FLRA (ACT I), 269 F.3d 1112, 1116 (D.C. Cir. 

2001) (“This is not to say that the expenditure of appropriated 

funds in a manner not authorized by law is negotiable – it is 

not.”); 1 GAO, PRINCIPLES OF FEDERAL APPROPRIATIONS LAW

4-9 (3d ed. 2004) (“an agency cannot use the device of a 

contract, grant, or agreement to accomplish a purpose it could 

not do by direct expenditure”).

The question, then, is whether providing bottled water 

under these circumstances would violate federal 

appropriations law. If it would, then the Navy cannot

continue providing bottled water at the Newport facilities and 

cannot bargain over that issue with the unions.

B

We have established so far that an agency’s obligations 

under federal collective bargaining law are circumscribed by 

the limitations imposed by federal appropriations law. 

Therefore, whether the Navy had a duty to bargain depends 

on whether federal appropriations law permits the purchase of 

bottled water where safe and drinkable tap water is available. 

The Authority ruled that using appropriated funds to

purchase bottled water at the Newport facilities would not

contravene federal appropriations law. Dep’t of the Navy, 

Naval Undersea Warfare Ctr. Div. Newport, R.I., 64 F.L.R.A. 

1136, 1139-40 (2010). The FLRA is entitled to “considerable 

deference” when interpreting and applying the Federal 

Service Labor-Management Relations Statute, its “own 

enabling statute.” ACT III, 534 F.3d at 776 (quoting Bureau 

of Alcohol, Tobacco & Firearms v. FLRA, 464 U.S. 89, 97 

(1983); ACT II, 370 F.3d at 1219). It receives no deference, 

however, when it “has endeavored to reconcile its organic 

statute with another statute” – such as a federal appropriations 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 14 of 20
15

statute – “not within its area of expertise.” Air Force, 648 

F.3d at 846 (quoting Dep’t of Veterans Affairs v. FLRA, 9 

F.3d 123, 126 (D.C. Cir. 1993)) (internal quotation marks, 

brackets, and ellipses omitted); see also Ass’n of Civilian 

Technicians, Tony Kempenich Mem’l Chapter 21 v. FLRA, 

269 F.3d 1119, 1121 (D.C. Cir. 2001); SSA v. FLRA, 201 F.3d 

465, 471 (D.C. Cir. 2000).

A core tenet of appropriations law is enshrined in 31 

U.S.C. § 1301(a), the “Purpose Statute,” which commands:

“Appropriations shall be applied only to the objects for which 

the appropriations were made except as otherwise provided by 

law.” Under Section 1301(a), in order for appropriated funds 

to be legally available for an expenditure, “the purpose of the 

obligation or expenditure must be authorized.” 1 GAO,

PRINCIPLES OF FEDERAL APPROPRIATIONS LAW at 4-6. 

To begin with, the relevant appropriations statute does 

not specifically prohibit the purchase of bottled water. But by 

the same token, no statutory language explicitly authorizes

the purchase of bottled water here. And all uses of 

appropriated funds must be affirmatively approved by 

Congress; the mere absence of a prohibition is not sufficient. 

The question then is whether, and under what 

circumstances, a general appropriation for an agency’s 

operations implicitly authorizes the purchase of bottled water.

The Comptroller General has developed the “necessary 

expense” doctrine as a rule of construction for appropriations 

statutes.4

 4 The Comptroller General is a legislative official who heads 

the Government Accountability Office. See 31 U.S.C. § 702(b). 

The Comptroller General is appointed to a 15-year term by the 

President with the advice and consent of the Senate. See 31 U.S.C. 

 That doctrine governs the many situations where, as 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 15 of 20
16

here, general statutory text leaves open whether a specific 

proposed expenditure is a legally authorized purpose for 

which appropriated funds may be expended. See ACT II, 370 

F.3d at 1221-22. This Court regards “the assessment of the 

GAO and thus, the Comptroller General as an expert opinion, 

which we should prudently consider but to which we have no 

obligation to defer.” ACT I, 269 F.3d at 1116 (quoting Delta 

Data Systems Corp. v. Webster, 744 F.2d 197, 201 & n.1 

(D.C. Cir. 1984) (Scalia, J.)) (internal quotation marks and 

brackets omitted); see also Delta Data Systems, 744 F.2d at 

201 n.1 (“Since the GAO has been thought to be an arm of the 

legislature, there might be a constitutional impediment to such 

binding effect.”) (internal quotation marks and citation 

omitted). Here, moreover, the Navy – an executive agency 

represented by the Department of Justice – agrees with the 

Comptroller General’s analysis. That said, although we 

consider the Comptroller General’s reasoning to the extent it 

is persuasive, “it is the court that has the last word.” Id. at 

202 (internal quotation marks and brackets omitted).

Under the necessary expense doctrine, “[a]n

appropriation made for a specific object is available for 

expenses necessarily incident to accomplishing that object 

unless prohibited by law or otherwise provided for.” 1 GAO,

PRINCIPLES OF FEDERAL APPROPRIATIONS LAW at 4-20; see 

also ACT II, 370 F.3d at 1218; Public Building Improvements, 

42 Comp. Gen. 226, 228 (1962). Whether an expenditure is 

reasonably necessary to accomplish the agency’s mission, “in 

 

§ 703(a)(1), (b). The President selects a nominee from a list of 

candidates prepared by a commission of congressional leaders. See 

31 U.S.C. § 703(a). Once appointed, the Comptroller General is 

removable only by Congress and only for cause. See 31 U.S.C. 

§ 703(e)(1); see also Bowsher v. Synar, 478 U.S. 714, 730 (1986) 

(“In constitutional terms, the removal powers over the Comptroller 

General’s office dictate that he will be subservient to Congress.”).

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 16 of 20
17

the first instance, is a matter of agency discretion,” but the 

expenditure’s “relationship to an authorized purpose or 

function” may be “so attenuated as to take it beyond that 

range” of permissible discretion. Implementation of Army 

Safety Program, B-223608 (Comp. Gen. Dec. 19, 1988).

The Comptroller General “has never established a precise 

formula for determining the application of the necessary 

expense rule”; rather, it applies and develops the doctrine 

through its “body of case law responsive to the changing 

needs of government.” 1 GAO, PRINCIPLES OF FEDERAL 

APPROPRIATIONS LAW at 4-21. That case law distinguishes 

necessary expenses, on which appropriated funds may be 

expended, from “personal expenses,” on which they may not 

be expended. See Scope of Professional Credentials Statute, 

B-302548, at 3 (Comp. Gen. Aug. 20, 2004) (“Generally, 

personal expenses are not payable from appropriated funds 

absent specific statutory authority.”). Personal expenses are

items that government employees are expected to obtain at 

their own expense, like food while at their regular workplaces 

(that is, not on government travel). See GAO, 1 PRINCIPLES 

OF FEDERAL APPROPRIATIONS LAW at 4-103 (“food is a 

personal expense and government salaries are presumed 

adequate to enable employees to eat regularly”).

The Comptroller General’s case law has analyzed when 

agencies may purchase bottled water under the necessary 

expense doctrine. As a threshold matter, “it has long been 

conceded that drinking water is a necessity” at the workplace. 

Id. at 4-119 n.70. “However, an agency may not use 

appropriated funds for bottled drinking water for the use of 

employees where the public water supply of the locality is 

safe for drinking purposes.” Id. (emphasis added). That is 

because, “[a]s a general proposition, bottled water is a 

personal expense for which appropriations are not available.” 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 17 of 20
18

Dep’t of the Army, Military Surface Deployment & 

Distribution Command – Use of Appropriations for Bottled 

Water, B-318588, at 1 (Comp. Gen. Sept. 29, 2009). 

Bottled water is considered “necessary” – and thus may 

be purchased with appropriated funds – when “the available 

water posed a health risk if consumed, or because water was 

not available.” Id. at 2-3. The line of Comptroller General 

decisions articulating this rule dates back at least to 1923. See 

Purchase of Drinking Water, 2 Comp. Gen. 776, 776 (1923) 

(“The purchase of drinking water is, ordinarily, a personal 

matter, and the expense may only be allowed upon the ground 

of necessity. It has been recognized as a duty upon the 

Government to supply drinking water where none is available 

in the offices or other public quarters or where that furnished 

is unwholesome or not potable.”); see also, e.g., Dep’t of the 

Army – Use of Appropriations for Bottled Water, B-310502, 

at 3 (Comp. Gen. Feb. 4, 2008); Clarence Maddox – Relief of 

Liability for Improper Payments for Bottled Water, B-303920, 

at 2-3 (Comp. Gen. Mar. 21, 2006); U.S. Agency for Int’l 

Development – Purchase of Bottled Drinking Water, B247871 (Comp. Gen. Apr. 10, 1992).

Under the Comptroller General’s longstanding reading of 

the statute, an agency would violate 31 U.S.C. § 1301 if it 

provided bottled water when safe and drinkable tap water is 

available. The Navy – represented by the Department of 

Justice – concurs in that reasoning and conclusion.

We agree with that interpretation of the statute. 

Permitting bottled water purchases only upon a showing of 

such necessity recognizes that “an agency, as an employer, is 

expected to meet certain basic needs of its employees, 

particularly when it comes to protecting an employee’s health 

and safety in the workplace.” Dep’t of the Army – Use of 

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 18 of 20
19

Appropriations for Bottled Water, B-310502, at 4. That rule

balances that appropriate solicitude for employee health with

the principle that food, including “snacks and refreshments,” 

“is a personal expense which a Government employee is 

expected to bear from his or her salary.” 1 GAO, PRINCIPLES 

OF FEDERAL APPROPRIATIONS LAW at 4-103 & n.58 (internal 

quotation marks omitted); see also id. at 4-103 (“In addition 

to the obvious reason that food is a personal expense and 

government salaries are presumed adequate to enable 

employees to eat regularly, furnishing free food might violate 

5 U.S.C. § 5536, which prohibits an employee from receiving 

compensation in addition to the pay and allowances fixed by 

law.”) (footnote omitted). Providing bottled water when safe

and drinkable tap water is available would serve no purpose 

other than accommodating employees’ personal tastes – a 

purpose that generally cannot justify the expenditure of 

appropriated funds.

The general rule prohibiting such expenditures serves to 

“ensure public confidence in the integrity of those who spend 

the taxpayers[’] money.” Id. at 4-108. In light of this 

overriding goal, the prohibition on bottled water when safe

and drinkable tap water is available strikes us as the correct 

application of the Purpose Statute. Therefore, if the tap water 

at the Newport facilities is safe and drinkable, the purchase of 

bottled water with appropriated funds would violate federal 

appropriations law – and the Navy would have no authority or 

duty to bargain with the unions before discontinuing the 

provision of free bottled water. See U.S. Agency for Int’l 

Development, B-247871 (“We conclude that the OIG may use 

appropriated funds to purchase bottled drinking water for its 

employees until the problems with the building’s water supply 

are adequately corrected and the water is shown to be safe.”) 

(emphasis added).

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 19 of 20
20

C

The remaining question is whether the tap water at the 

Newport facilities is in fact safe to drink. The Navy argues 

that the decisions in the related Cain arbitrations conclusively 

establish that the tap water is safe to drink. Those arbitrations 

were not in the record before the Authority. The Navy did, 

however, raise at every stage of the proceedings the argument 

that the tap water was safe to drink and that the Navy 

therefore had no discretion to provide bottled water. Under 

the circumstances, we think the prudent course is to remand to 

the Authority for it to assess the Cain arbitrations and the 

more fundamental question whether the tap water is in fact 

safe to drink. If the water at the Newport facilities is safe to 

drink, then the Authority must rule for the Navy.

* * *

We grant the petition for review, vacate the FLRA’s 

order, and remand this case for the Authority to determine 

whether the tap water is in fact safe to drink. If the tap water 

is in fact safe to drink, the FLRA must rule for the Navy.

So ordered.

USCA Case #10-1304 Document #1352521 Filed: 01/13/2012 Page 20 of 20