Note 15. Liabilities Not Covered by Budgetary Resources

Liabilities not Covered by Budgetary Resources
(In Thousands)

	FY 2005	FY 2004
Intragovernmental
Accrued FECA Liability	$   28,485	$   28,272
Other	4,110	594
Total Intragovernmental	32,595	28,866
Accrued Payroll	21,359	20,361
Accrued Annual Leave	194,771	186,406
Federal Employee Benefits	569,114	557,679
Environmental and Disposal Liabilities	73,311	78,687
Contingent Liabilities	3,383	22,786
Capital Lease Liabilities	694	13,398
Unearned Revenue	690,488	570,817
ITA Foreign Service Nationals' Voluntary Separation Pay	9,453	9,344
Other	3,725	1,144
Total	$1,598,893	$1,489,488

Due to USPTO’s funding structure, budgetary resources do not cover a portion of its Unearned Revenue. The Unearned Revenue as of September 30 reported above is the portion of USPTO’s Unearned Revenue that is considered not covered by budgetary resources. USPTO’s Unearned Revenue is a liability for revenue received before the patent or trademark work has been completed. Budgetary resources derived from the current reporting period’s revenue have been partially used to cover the current reporting period’s costs associated with unearned revenue from a prior reporting period. In addition, the current patent fee structure sets low initial application fees that are followed by income from maintenance fees as a supplement in later years to cover the full cost of the patent examination and issuance processes. The combination of these funding circumstances requires USPTO to obtain additional budgetary resources to cover its liability for unearned revenue.