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DoD Financial Management Regulation Volume 11A, Chapter 3
+ April 2000
+ 030101. Purpose. This chapter prescribes policies and procedures applicable to
transactions where goods or services are procured from other federal agencies under the
Economy Act, Title 31, United States Code (U.S.C.), sections 1535 and 1536. Transactions
include interservice and intergovernmental support, where an activity needing supplies or
services (requesting agency/customer) obtains them from another activity (servicing
agency/performer). Within the Department of Defense (DoD), Economy Act orders typically are
executed by issuance of a DD Form 448, "Military Interdepartmental Purchase Request
+ 030102. Overview. The Economy Act provides authority for federal agencies to
order goods and services from other federal agencies (including other Military Departments and
Defense Agencies) and to pay the actual costs of those goods and services. The Congress passed
the Act in 1932 to obtain economies of scale and eliminate overlapping activities of the federal
government. Within the Department, an activity within a DoD Component may place an order
with another activity within the same DoD Component, another DoD Component or with another
federal agency for goods or services. References on the use of Economy Act orders include:
DoD Instruction 4000.19, "Interservice and Intragovernmental Support" and the Federal
Acquisition Regulation (FAR), subpart 17.5, "Interagency Acquisitions Under the Economy
+ 030103. Legal Authority
A. In accordance with 31 U.S.C., section 1535, the head of an agency or
major organizational unit within an agency may place an order with a major organizational unit
within the same agency or another agency for goods or services if:
1. Funds are available;
2. The head of the requesting agency or unit decides the order is in
the best interest of the United States (U.S.) Government;
3. The agency or unit to be asked to fill the order is able to provide
the ordered goods or services; and
4. The head of the agency decides that ordered goods or services
cannot be provided as conveniently or economically by a commercial enterprise.
B. 31 U.S.C, section 1536 provides for the crediting of payments from
purchases between executive agencies so as to be available to replace stocks on hand, unless:
DoD Financial Management Regulation Volume 11A, Chapter 3
+ April 2000
1. Another law authorizes the amount to be credited to some other
appropriation, or
2. The head of the performing agency decides that replacement is not
necessary, in which case, the amount received is deposited in the Treasury as miscellaneous
C. In accordance with Title 10, U.S.C., section 2205, reimbursements made
to DoD appropriations under 31 U.S.C., sections 1535 and 1536 for services rendered or supplies
furnished, may be credited to the appropriation or fund of the activity performing the
reimbursable work.
+ 030104. Limitations. Because of previous instances of abuse of Economy Act
orders, limitations on the use of Economy Act orders have been imposed. Economy Act orders
may not be used by an agency to circumvent conditions and limitations imposed on the use of
funds, including extending the period of availability of the cited funds. Acquisitions under the
Economy Act are subject to the requirements of FAR Subpart 7.3, "Contractor Versus
Government Performance." The Economy Act may not be used to make acquisitions conflicting
with any other agency's authority or responsibility (see FAR Subpart 17.502). An Economy Act
order cannot be used by one organizational unit to order work or services from another
organizational unit under the same activity commander where the activity commander is in a
position to fund the required goods or services through the use of direct funds.
+ 030201. An agency or unit head may initiate an Economy Act order provided that
all the conditions specified in subparagraph 030103.A., above, are met.
+ 030202. Determinations and Findings Requirements
A. In general, all Economy Act orders must be supported by a
Determinations and Findings (D&F) that the use of interagency support capabilities is in the best
interest of the government and that the required goods, supplies or services cannot be obtained as
conveniently or economically by contracting directly with a private source.
B. Economy Act orders that require a contract action by a non-DoD servicing
agency also will include a statement on the Determinations and Findings (D&F) that supplies
and services provided comply with one or more of the following provisions:
1. The acquisition appropriately will be made under an existing
contract of the servicing agency, entered into before placement of the order, to meet the
requirements of the servicing agency for the same or similar goods, supplies or services;
DoD Financial Management Regulation Volume 11A, Chapter 3
+ April 2000
2. The servicing agency has the capabilities or expertise to enter into
a contract for such goods, supplies or services which are not available within the requesting
agency; or
3. The servicing agency specifically is authorized by law or
regulation to purchase such goods, supplies or services on behalf of other agencies.
030203. Interservice Support. DoD activities shall render requested support to
other DoD activities when the head of the requesting activity determines that it would be in the
best interest of the U.S. Government, and the head of the servicing activity determines that
capabilities exist to render the support without jeopardizing assigned missions. These
determinations are accomplished by signing a Support Agreement (blocks 8 and 9 on DD Form
1144, "Support Agreement"). No further written determinations generally are required for
agreements between DoD activities.
+ 030204. Intragovernmental Support. DoD activities may enter into support
agreements with non-DoD federal activities when the head of the major organizational unit
ordering the support determines that funding is available to pay for the support, it is in the best
interests of the United States Government, the supplying activity is able to provide the support,
the support cannot be provided as conveniently or economically by a commercial enterprise, and
it does not conflict with any other agency's authority. This authority may be delegated, although
designees may not be lower than Senior Executive Service, Flag, or General Officer levels.
Subject to the provisions of Sections 0301 and 0302, above, and 0304, below, Economy
Act orders may be used for any required goods, supplies or services that are appropriate and
legal. Typical uses include, but are not limited to:
A. Interservice Support Agreements. This type of agreement typically is used
for, but not limited to, base support (host-tenant) services such as: administrative services,
civilian personnel services, community services, environmental compliance, fire protection, food
service, health service, mail service, police service, security/guard services, warehousing, etc.
Services such as testing and evaluation, and level of effort workyears may be covered by
Economy Act orders.
B. Interagency Agreements. This includes support provided to non-DoD
federal agencies that is not provided pursuant to other statutory authority.
+0304 POLICY
+ 030401. Specific, Definite and Certain. Economy Act orders (interservice and
intragovernmental support agreements) shall be specific, definite and certain both as to the work
encompassed by the order and the terms of the order itself.