Appropriated funds are divided into two (2) basic types; (1) investment funds and (2) expense funds. The defining of an acquisition as either investment or expense, or even a combination of the two, is not always simple. Generally, however, the following definitions apply. [1]
Investment:
Includes the cost of real property and capital assets which expand or add to DoD’s current capability. This includes, but is not limited to, the following examples:
- Items of equipment or systems costing more than $250,000 (as of fiscal year 2009)
- Centrally managed items regardless of cost
- Certain categories of civilian labor associated with the acquisition or modification of investment funded items
- The initial outfitting of a system procured with investment funds, even if the individual items themselves would normally be expense items
- Site preparation and the installation of investment funded equipment
- The training of an initial cadre of operators and maintenance personnel for an investment funded training system
- Items defined or designated as investment
Expenses:
Includes the cost of assets consumed in the operation and maintenance of DoD facilities and equipment. This includes, but is not limited to, the following examples:
- Most labor of civilian and military personnel
- Non-centrally managed equipment items or systems costing $250,000 or less (as of FY 2010)
- Contractual services supporting expense type efforts
- Rental/lease of equipment and facilities
- The repair/maintenance/rework/overhaul of capital equipment and facilities
- Modifications to investment equipment that are mainly for reliability, maintainability, or safety purposes
- Expendable supplies and materials
- The replacement of initially outfitted materials
- Licenses and subscriptions
See Appropriation Categories for more details on specific appropriation funds.
AcqLinks and References:
Updated: 7/19/2021
Rank: G