Federal Managers Association

As a result of the hard work on the part of the coalition, the Senate provisions were included in the Defense Authorization conference report. The report will have to be approved by the House and Senate before going to the President for his signature. For a copy of the letter, please visit FMA’s “Members Only” section at www.fedmanagers.org.

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WHAT’S HAPPENING ON CAPITOL HILL?

DOD FIRST SPENDING BILL SIGNED INTO LAW, CR EXTENDED

President Bush signed the first fiscal year 2008 Department of Defense (DOD) appropriations bill (H.R. 3222) into law, now known as Public Law No. 110-116. The $459 billion measure increases DOD operations spending by 9.5 percent over FY07. These expenditures fund all defense-related operations with the exception of combat operations in Afghanistan and Iraq. Included in the bill was a 3.5% pay raise for members of the Armed Services.

Congress earmarked $48 million to increase Pentagon staff dedicated to overseeing projects. The money is to be divided among the Defense Contract Audit Agency, the Defense Contract Management Agency and the Defense Inspector General. This coincides with a shift in policy since the election for increasing governmental oversight and reviewing previous government contracts. At a Senate Armed Services Committee hearing on November 15th, Secretary of the Army Peter Geren acknowledged that the Army needs to do a better job overseeing contractors who provide support for operations in Iraq and Afghanistan.

At the same hearing, Geren testified on how the absence of funding for military operations in Afghanistan and Iraq in the DOD appropriations bill was detrimental to the Army. Geren stated in his testimony that “our soldiers” are depending on the DOD appropriations. U.S. Army Chief of Staff General George Casey, Jr. was more explicit about the financial situation the Army is facing. Casey stated that the DOD appropriations bill will allow the Army to continue essential missions for a limited time but a lack of funding for the Global War on Terror will cause us to tap into our base programs to continue essential operations. General Casey stated the Army will exhaust its funds by late January or mid-to-late February at this rate. The General informed the Senate that without its support, DOD will be utilizing funds for the civilian sector and this will shut down civilian operations at DOD and that furloughs would be likely.

Also included in the bill was another continuing resolution (CR) extended until December 14th, funding most agencies at fiscal year 2007 levels. This is the second CR as the Defense funding bill has been the only spending legislation signed into law for fiscal year 2008. Another CR is looming, as it is unlikely Congress and the President will agree on the eleven remaining bills in the next three weeks.

To review the Appropriations legislation and the Afghanistan and Iraq combat operations funding legislation, please visit http://thomas.loc.gov/. To obtain a copy of Secretary Geren or General Casey’s statements to the Senate Armed Services Committee, please visit http://armed-services.senate.gov/.

BUSH EXERTS VETO POWER ON LARGEST DOMESTIC SPENDING BILL

Just before Congress adjourned for the two-week Thanksgiving recess, President Bush vetoed the first (and largest) domestic spending bill sent to his desk. Two days later, the House of Representatives failed to override the President’s veto of the $150.7 billion Labor/Health and Human Services/Education spending bill (H.R. 3043).

The bill, which funds education and health care programs as well the Social Security Administration, is $6.2 billion above the fiscal year 2007 level and $9.8 billion more than Bush proposed. Of the twelve appropriations bills, the Labor/HHS/Education spending bill represents the largest difference between what the President proposed and Congress provided. The bill also accounts for almost half of the disparity between the President and Congress in total fiscal year 2008 funding.

The President cited excessive spending, especially on earmarks, as his reason for vetoing the bill. “ The Congress is on a path to spend $205 billion more over the next 5 years than I requested. This puts a balanced budget in jeopardy and risks future tax increases. This year, the Congress plans to overspend my budget by $22 billion, of which $10 billion is for increases in this bill. Health care, education, job training, and other goals can be achieved without this excessive spending if the Congress sets priorities… This bill contains more than 2,200 earmarks totaling nearly $1 billion. Congressional earmarks divert Federal taxpayer funds to localities without the benefit of a merit-based process, resulting in fewer resources for national priorities or unnecessary spending above the requested level.”

In response to the President’s veto, House Speaker Nancy Pelosi commented, “ The President again vetoed a bipartisan and fiscally responsible bill that addresses the priorities of the American people: education for our children, assistance in paying skyrocketing energy costs, veterans’ health care, and other urgent health research on cancer and other serious medical problems. At the same time, President Bush and his Congressional allies demand hundreds of billions of dollars for the war in Iraq -- none of it paid for.”

Appropriations leaders have yet to announce how they will proceed with the bill. One scenario mentioned would be to split the difference between the level of funding proposed by the President and Congress. For up-to-date information on the bill, please visit: http://thomas.loc.gov.

LEGISLATION EXPANDING TELEWORK ON THE MOVE

The Senate Committee on Homeland Security and Governmental Affairs passed S. 1000, the Telework Enhancement Act of 2007, on November 14th, by voice vote. The chief sponsors of the Senate bill, Senators Ted Stevens (R-Ak.) and Mary Landrieu (D-La.), stated the legislation will allow agencies to decide which employees can telework. The legislation calls for incorporating telework training into agency’s new employee orientation. Also, the legislation establishes a Telework Managing Officer who will be appointed by each executive agency to implement telework policies.

As a result of the legislation, teleworking will be incorporated into the continuity of operations planning of agencies. The legislation does not allow federal employees who handle sensitive information, work on national security and intelligence matters, or have a position that requires their physical presence in the office, to telework.

Similar legislation has been introduced in the House, H.R. 4106, the Telework Improvements Act of 2007. Sponsored by Representatives Danny Davis (D-Ill.) and John Sarbanes (D-Md.), H.R. 4106 is analogous to the Senate version with one exception. The House version mandates eligible federal employees to telework one day per week.

For more information on these bills please visit: http://www.thomas.loc.gov/.

SENATE PASSES TOUGH CONTRACTING REFORM BILL

Following the lead established by the House this past spring when they passed the Accountability in Contracting Act (H.R. 1362), the Senate passed the Accountability in Government Contracting Act (S. 680) on November 9th sponsored by Senators Joseph Lieberman (I-Conn.) and Susan Collins (R-Me.), chairman and ranking member of the Senate Homeland Security and Governmental Affairs Committee, respectively. The legislation provides sweeping reform to the federal contracting and acquisition process.

The legislation is a response to federal contracting disputes and scandals that have appeared in the media over the past several years. The legislation limits the length of certain sole-source contracts to 270 days. The majority of bid requests must be received from three qualified contractors to ensure that taxpayer dollars are spent wisely. The legislation requires contracts that are worth in excess of $100,000 to have a bidding process. Detailed statements of work and post-award debriefings for orders over $5 million are a prerequisite under the legislation.

S. 680 will create a Contingency Contracting Corps of trained and experienced acquisition personnel to respond in emergencies and ferret out waste caused by bungled emergency contracts. Senators Lieberman and Collins were also aware of the need to replenish the federal workforce with new hires. The legislation creates a government-wide acquisition intern program with a goal of involving 200 recent college graduates annually.

To view S. 680 or H.R. 1362, please visit: http://thomas.loc.gov/.

E-GOV ENHANCEMENTS SEE PROGRESS IN SENATE

The Senate Homeland Security and Governmental Affairs Committee passed S. 2321 which will reauthorize and amend the E-Government Act of 2002. The E-Government Act was aimed at boosting initiatives that make government information accessible online. The legislation has not yielded the desired results and Senators Joseph Lieberman (I-Conn.), Susan Collins (R-M.), and Tom Carper (D-Del.) took a proactive stance to remedy federal agencies’ failure to make government documents more accessible to the public on the Internet.

Many elements of the previous legislation were left unchanged. The 2002 bill established a Federal Chief Information Officer within the Office of Management and Budget (OMB). The legislation requires federal courts to publish judicial opinions online. The reauthorization requires the Director of OMB to draft a plan for making government information more accessible to the public via commercial and government search engines in one year. Federal agencies have two years to comply with the director’s plans. The bill extends the authorization for the government’s public Web sites for another five years.

For more information on S. 2321, visit http://www.thomas.loc.gov/.

MUKASEY CONFIRMED BY SENATE, NOMINATION FOR IRS HEAD

The Senate confirmed Judge Michael Mukasey as the 81st Attorney General of the United States on November 8th. Mukasey was confirmed by a vote of 53 to 40 in the Senate. Attorney General Mukasey replaces the controversial Alberto Gonzalez. President Bush described the former judge as a “man of strong character and integrity, with exceptional legal judgment [. . . who will] lead the Justice Department as it works to protect the American people.” The new Attorney General arrived at the U.S. Department of Justice on November 9th.

For more information on Attorney General Mukasey, please visit: www.usdoj.gov.

In other news, President Bush announced on November 21st the nomination of Douglas Shulman to be the next Commissioner of the Internal Revenue Service (IRS) at the Department of Treasury. Mr. Shulman is currently the Vice Chairman of the Financial Industry Regulatory Authority, previously known as the National Association of Securities Dealers. He is no stranger to the issues affecting the Internal Revenue Service. Mr. Shulman served as Senior Policy Advisor of, and later Chief of Staff, to the bipartisan National Commission on Restructuring the Internal Revenue Service during the Clinton administration.

To view the White House personnel announcement, please visit: http://www.whitehouse.gov.

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WHAT’S NEW IN THE EXECUTIVE BRANCH?

OPM TACKLES LOOMING HUMAN CAPITAL CRISIS

The Chief Human Capital Officers Council (CHCO) members, under the leadership of the Office of Personnel and Management (OPM) Director Linda Springer, approved a fiscal year 2008 subcommittee strategic plan to address the federal government’s looming human capital challenges. Last year, the CHCO Council adopted the very first version of the subcommittee’s mission statements and goals, and this year's plan hopes to build on the successes achieved in FY 2007.

OPM Director Springer commented, “FY 2007 was a breakthrough year for the CHCO Council’s six subcommittees as they accomplished activities that helped raise the profile of the Council and they provided recommendations for a variety of human capital initiatives to OPM.” The CHCO Council has called upon the Chief Human Capital Officers to work closely with OPM in an effort to develop and improve telework programs, marketing and recruitment strategies, and boosting employee development.

The CHCO Council is responding to the Government Accountability Office’s (GAO) research on human capital management for the past several years. On October 31, 2007, GAO published report GAO-08-11, entitled, “Opportunities Exist to Build on Recent Progress in Internal Human Capital Capacity,” as a continuation of previous GAO studies on human capital management. The most recent GAO study addresses federal employee responses to the 2004 and 2006 Federal Human Capital Survey. The 2006 survey results delineated that leadership in federal agencies has improved, while indicating mixed results in performance culture and accountability areas, and the retention and recruitment of mission critical employees. The survey is conducted to help OPM strategize how to improve human capital management.

The CHCO Council is working to implement the GAO recommendations due to the importance of workforce continuity given an upcoming transition between administrations and pending “retirement tsunami.”

To review the CHCO Council strategic plan, please visit: http://www.opm.gov/. The GAO report, “Opportunities Exist to Build on Recent Progress in Internal Human Capital Capacity,” can be found at: http://www.gao.gov/.

BUSH ISSUES EXECUTIVE ORDER AIMED AT INCREASING PERFORMANCE

The White House issued another administrative policy on November 13th. President Bush issued an Executive Order entitled, “Improving Government Program Performance,” as part of the Administration’s drive to boost accountability among federal agencies. This latest order boosts the Office of Management and Budget’s (OMB) Program Assessment Rating Tool (PART) that utilizes a scorecard to determine an agency’s performance.

The Order requires heads of federal agencies to establish annual goals and methods of achieving these goals. The legislation calls for a member of the Senior Executive Service (or equivalent service) to be designated a performance improvement officer in an agency. This officer will determine how an agency is progressing to meet its goals. Furthermore, the order creates a Performance Improvement Council chaired by the deputy director for management at OMB.

To view the Executive Order, please visit: http://www.whitehouse.gov.

TSP BOARD ENACTS NEW TRADING RESTRICTIONS

In a letter to the Employee Thrift Advisory Council (ETAC), of which the Federal Managers Association (FMA) is a member, Federal Retirement Thrift Investment Board (FRTIB) Executive Director Greg Long proposed changes to the Thrift Savings Account (TSP) regarding frequent trading and asked the advisory board for opinions.

Recently, a small number of investors (less than 3,000 of the TSP’s 3.8 million members) have participated in excessive frequent trading. In 2006, the TSP incurred transaction expenses of over $15 million, compared to only $6.7 million in 2005 and $2.2 million in 2004. The I Fund, which invests in international stocks, encountered the most expenses, where trading $12 billion in securities led to $13.8 million in expenses.

Due to this rapid fire buying and selling, and the costs associated with the practice, the FTRIB plans to enact controls to reign in the frequent trading. Investors would be allowed two interfund transfers per month. The Board has stated this plan is more flexible and liberal when compared to other trading restrictions in the marketplace.

Information on the TSP can be found at: www.tsp.gov.

AGENCIES MAKING STRIDES IN FINANCIAL REPORTING

The White House announced on November 20th that all major federal agencies met the new 45-day financial audit deadline as required by the U.S. Office of Management and Budget (OMB). The deadline this year for submitting completed financial reports was shortened to 45 days from 150 days. Five additional agencies were added to the list of agencies that received a clean opinion with no material weaknesses; these agencies include the Departments of Justice, Interior, and Energy, the Small Business Administration, and the U.S. Agency for International Development. In total, 19 agencies received clean opinions on their fiscal 2007 financial statements

Federal agency results have leaped to new heights. The decrease in weaknesses is significant because of recent changes to government audit guidelines that lower materiality thresholds and have the effect of characterizing more audit findings as “material weaknesses.” Even with the stringent guidelines, federal agencies can boast that they are more responsible. OMB Deputy Director for Management Clay Johnson stated, “Once again, we raised the bar and the agencies rose to the challenge. I congratulate these agencies for meeting the tough 45-day deadline and obtaining clean audit opinions.” In 2007, federal agencies reported improper payment measurements for nearly 86 percent of all high-risk outlays, up from 81 percent in 2006, with error rates reported on 13 programs.

The error rate has slowly been chipped away by federal agencies. In fiscal year 2004, the error rate for federal programs was 3.9 percent, or $45.1 billion in improper payments. For the same programs measured in 2007, the error rate has declined to 3.1 percent, or a $7.9 billion reduction in improper payments. With 13 additional programs participating in the audit in fiscal year 2007, the preliminary government-wide error rate increased to 3.5 percent, or $54.9 billion. If the trend over the past couple of years is a guide, the 13 additional agencies’ error rates should decrease in the coming years.

OMB highlighted particular programs for their exceptional accomplishments. The error rate for Medicare declined from 4.4 percent to 3.9 percent this year. The Old Age, Survivors and Disability Insurance program’s error rate fell from 0.6 percent to 0.5 percent, saving taxpayers $776 million in improper payments. Another notable program, Head Start, fell from 3.1 percent to 1.3 percent, sparing $122 million from being spent on improper payments. The Marketing Assistance Loan Program error rate declined from 20.2 percent to 7.5 percent, leading to $1 billion saved in improper payments. Five additional Farm Service Agency programs reduced documentation errors with the result of reducing overall errors by nearly $1.2 billion, or 92 percent. Deputy Director Johnson noted, “The Federal government has established an impressive track record of making improper payment measurements transparent to the public and then taking quick and effective action to eliminate them.” Federal agencies have demonstrated that they can make rapid gains in a short period of time.

For more information on financial reporting, please visit: http://www.whitehouse.gov/omb/.

MORE VETS ENTERING THE FEDERAL WORKFORCE

The U.S. Office of Personnel Management (OPM) released on November 14th a report entitled, Employment of Veterans in Federal Government: Fiscal Year 2006. The report notes an increase in the number of armed forces veterans working for the federal government. OPM Director Linda Springer described the report as demonstrating “[T]he effectiveness of our efforts to heed President Bush’s call to bring more veterans into the Federal civilian workforce.” She also applauded those veterans who have entered federal civilian employment for their decision to continue to serve the American people.

The total number of veterans employed by the federal government increased from 456,254, or 25.2 percent of the total federal workforce in federal fiscal year 2005, to 457,965, or 25.4 percent in FY06. The number of newly hired veterans increased from 48,257 to 50,108. Veterans represented 22.1 percent of all new federal hires in FY 2006; the highest percentage in four years. These results could be due to OPM’s efforts to recruit veterans returning from combat operations in Afghanistan and Iraq. OPM utilizes Veterans’ Outreach Offices to assist returning veterans interested in federal civilian employment opportunities.

Some federal agencies lead the pack in hiring veterans. The U.S. Air Force led the way with 48.5 percent of their workforce being veterans and 11.4 percent of their workforce consisting of disabled veterans. Over forty percent of the Department of the Army’sworkforce is veterans, where 11 percent of the employees are disabled veterans. Over 18 percent of the Department of Justice’s workforce is filled with veterans and at the U.S. Department of State, 16 percent of its workforce are veterans. Across the board, most agencies reported a higher percentage of employed veterans over the previous year.

The report denotes that the federal government does a superior job of hiring veterans, who make up 25.4 percent of the federal workforce while they only represent 8.9 percent of the civilian labor pool. The OPM figures also demonstrate that there is a net decrease in the number of employees leaving federal employment. The total number of full-time permanent employees in the federal government decreased from 1,569,650 in fiscal year 2005 to 1,565,159 in fiscal year 2006, an overall decline of 4,491 employees.

OPM obtained the statistics from the August 2005 special biennial supplement to the Current Population Survey conducted for the U.S. Department of Labor’s Bureau of Labor Statistics by the Bureau of the Census. The fiscal year 2006 report examines OPM’s Central Personnel Data File (CPDF) data for 18 federal departments and 25 independent agencies that had 500 or more employees as of September 30, 2006.

To review the OPM report Employment of Veterans in Federal Government: Fiscal Year 2006, please visit http://www.opm.gov/employ/veterans/dvaap/2006/DVAAP-FY2006.pdf.

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GET INVOLVED AT THESE EVENTS!

PRELIMINARY AGENDA SET FOR FMA’S NATIONAL CONVENTION!

Planning for the Federal Managers Association 70th annual National Convention is underway! The event will take place March 9 – 13, 2008, at the Hilton Crystal City Hotel in Arlington, Virginia. Delegates can expect to receive a wealth of knowledge from private sector and government leaders under this year’s convention theme, Empowering America’s Workforce for the Challenges of Today, Tomorrow and Beyond.

Registration for the convention is available NOW. Please continue to check the “Events” section of the FMA Web site, www.fedmanagers.org, for the most up-to-date information. We look forward to seeing you in March!

Human Capital Management for Defense 2008 (HCMD 2008)

Human Capital Management for Defense (HCMD 2008) is critical to your success in strategically managing human capital. Learn how senior leaders are developing the right mix of skills across the total force, aligning skills to requirements, and addressing competency gaps. Attend HCMD 2008 to gather best practices in the recruitment and retention of quality personnel and learn about exciting workforce development initiatives across DOD. For more information, please visit www.hcmd2008.com. FMA is an official cosponsor of this conference.

The event will be held February 26-29, 2008 at the Marriott Crystal Gateway, Arlington, VA.

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Long Term Care Partners, LLC, FMA Corporate Partner.  Long Term Care Partners is the administrator of the Federal Long Term Care Insurance Program.  Sponsored by the U.S. Office of Personnel Management, the Program is available to Federal and U.S. Postal Service employees and annuitants, active and retired members of the uniformed services, and their qualified relatives.  With more than 210,000 enrollees, it is the largest employer-sponsored long term care insurance program in the country.  FLTCIP policies are simple to understand and offer enrollees some distinct advantages, including comprehensive coverage, competitive and stable rates, international coverage, and administrative service standards that are the highest in the long-term care insurance industry.  Policies are sold direct through a highly-trained, non-commissioned staff with no high pressure sales tactics – simply sound advice.  Visit www.LTCFEDS.com or http://www.opm.gov/insure/ltc/index.asp for more information.

Blue Cross Blue Shield Association Federal Employee Program, FMA Sustaining Corporate Partner:  The Blue Cross and Blue Shield Association represents the independent, locally operated Blue Cross and Blue Shield Plans. The 40 local member companies of the Blue Cross and Blue Shield Association have provided millions of families with top-quality, affordable health insurance for more than 70 years.  For the one in four Americans who carry Blue Cross and Blue Shield cards, the Blue Plans symbolize health security.  Visit www.fepblue.org and join the best, most-recognized group of health insurance providers in the world.

Wright & Co., FMA Sustaining Corporate Partner:  Wright & Co. has provided supplemental insurance programs to the Federal government for over 40 years.  They have built strong relationships with insurance companies and service providers to offer these comprehensive benefits at low, affordable group insurance rates.  Benefits include: Dental Insurance Plans; Term Life Insurance Plans; Accidental Death and Dismemberment Plan; and Personal Umbrella Plan.  Wright & Co. is also the originator of the Federal Professional Liability Program and provider of Disability Income Replacement coverage, underwritten by the Hudson Insurance Group, to all Federal employees.  For more information, please visit:  www.wrightandco.com.

GEICO, FMA Corporate Partner:  GEICO was created over 60 years ago to insure Federal employees.  Over the years GEICO has continuously strengthened its affiliation with the Federal workforce.  Today GEICO has a special program established to support the Federal community.  GEICO’s Federal program participates in the following organizations and programs: GEICO Public Service Awards, which  have honored Federal workers (active and retired) who have contributed to the public good since 1980; and GEICO Federal Leave Record Cards, which for over 40 years have been provided by GEICO to Federal employees, free of charge, to help them track their annual leave.  Find out how much you could save with GEICO auto insurance as an FMA member by getting a line-by-line rate quote at:  www.geico.com.

Shaw, Bransford, Veilleux and Roth, P.C., (SBVR) concentrates its law practice on the representation of Federal employees, with a special emphasis on the representation of executives and managers.  SBVR serves as General Counsel to the Federal Managers Association and is uniquely situated to recognize the interests and viewpoints of Federal managers.  For up to two free half-hour legal consultations and reduced legal fees as an FMA member, please visit:  www.shawbransford.com.

The Federal Managers Association and Management Concepts have teamed up to present the Federal Managers Practicum — a targeted certificate program for Federal managers. As the official development program for FMA, the Federal Managers Practicum helps FMA members develop critical skills to meet new workplace demands and deepen their managerial capabilities.  FMA’s leadership fully recognizes the need to prepare career-minded federal employees to manage the demands of the 21st century workplace with greater competence and fully supports this unique and comprehensive certificate program.  For more information, please visit:  www.managementconcepts.com/fmp/fmpodp.asp.

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The Washington Report is published biweekly by the Federal Managers Association.
Jessica Klement, Editor; FMA Staff Writers.

The Federal Managers Association, established in 1913, is the oldest, largest, most influential association representing the interests of the nearly 200,000 managers, supervisors and executives serving in today’s Federal government.

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