What are Non-Appropriated Funds (NAFs)?

• A. Funds generated by the military community through the sale of goods and services, not appropriated by Congress.
• B. Funds provided by Congress with a specific purpose.
• C. Funds deposited into Social Security accounts.
• D. Deposit funds held by the government.

Answer: (A)

Non-appropriated funds are money earned by the military community from the sale of goods and services at installations, and it is not provided by Congress. This revenue comes from on-base activities like recreation centers, clubs, gyms, dining facilities, and similar programs that serve service members and their families. The key point is that these funds stay within the installation to support morale, welfare, and recreation programs and other quality-of-life efforts, without being part of the federal appropriations process.

The other options describe funds that do come from outside this model: funds provided by Congress for a specific purpose are appropriated funds; deposits into Social Security accounts are payroll/insurance trust funds; and deposit funds held by the government is a general description that doesn’t capture the specific source and use of NAFs.