VZCZCXRO0909
OO RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #1654 1410700
ZNR UUUUU ZZH
O 210700Z MAY 07
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC IMMEDIATE 1260
INFO RUCNRAQ/IRAQ COLLECTIVE PRIORITY

UNCLAS BAGHDAD 001654 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EAID IZ PREL
SUBJECT: TWO ISSUES REGARDING IRRF RE-OBLIGATION AUTHORITY 
 
Summary 
------- 
 
¶1.  As the infrastructure programs supported by Iraq Relief 
and Reconstruction Funds (IRRF) come to an end over the next 
year, it is important that we retain the ability to shift 
funds among projects through re-obligation authority. We also 
need to make the de-obligation/re-obligation procedures more 
efficient, both in Washington and in Baghdad.  End Summary. 
 
De-obligation/Re-obligation in the Supplemental 
--------------------------------------------- -- 
 
¶2.  The latest conference version of the FY07 Supplemental 
Appropriations Bill that we have seen does not include 
language giving us the flexibility to de-obligate funds from 
some IRRF projects and re-obligate them to others.  If such 
language is not added, the Administration will lose the 
flexibility to shift remaining funds to meet our needs.  Lack 
of this flexibility will make it difficult to successfully 
complete the remaining important infrastructure projects in 
Iraq. 
 
¶3.  The FY06 Supplemental Appropriation included authority 
for us to re-obligate money.  Some projects were not needed, 
were closed because of security concerns, or were handed over 
to the Iraqi Government to complete at lower cost.  Others 
suffered cost overruns because of unforeseen expenses or the 
need for more capacity.  The ability to shift funds among 
them has been valuable - we have de-obligated $300 million 
using our current authority.  The de-ob/re-ob process is 
rigorous and transparent.  If we shift funds between projects 
in different sectors, Congressional notification is required. 
 
¶4.  I understand that the Department has made inclusion of 
re-obligation authority a top priority and that the Deputy 
Secretary personally has engaged Congressional leadership on 
 
SIPDIS 
this point.  Please let me know if I can reinforce the 
importance of this issue by making calls or by having my 
staff provide examples or details.  MNF-I tells me that the 
Defense Department is also pressing this issue on the Hill. 
 
Increasing De-obligation/Re-obligation Efficiency 
--------------------------------------------- ---- 
 
¶5.  The second issue is the time required by the current 
de-ob/re-ob process.  This will become especially critical if 
re-obligation authority is not extended.  It can take more 
than 60 days from the point at which we identify a need to 
the point at which we receive authorization to shift funds - 
not including Congressional Notification (CN) period. 
 
¶6.  I recommend that State, Defense, and OMB take a look at 
whether the process of de-ob/re-ob can be speeded up in 
Washington.  For our part, I have instructed my staff to make 
sure that we are acting as quickly as possible on de-ob/re-ob 
in Baghdad.  We cannot short-circuit the process, but we 
should ensure that requests receive prompt review at every 
stage as we enter this crucial period.  IRRF is still making 
a major contribution but largely will be judged on how it 
ends.  We owe it to the people of Iraq and to U.S. taxpayers 
to spend the remaining $3 billion as wisely as possible. 
CROCKER