Federal Managers Association

To view Kathy Meinhardt’s testimony, please visit our Web site at: www.fedmanagers.org.

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WHAT’S HAPPENING ON CAPITOL HILL?

CONGRESS FUNDS GOVERNMENT WITH CONTINUING RESOLUTION

On September 27, a $600 billion Continuing Resolution (CR) funding the government through the beginning of March 2009 was approved by the Senate, clearing the measure for the President. The funding bill, H.R. 2638, funds the federal government at the fiscal year 2008 levels with a handful of exceptions. The Departments of Homeland Security, Defense and Veterans Affairs received funding for the entirety of fiscal year 2009. The bill also provides federal employees with a 3.9 percent pay raise for 2009, a full percentage point above the President’s request.

While a 3.9 percent pay raise is certainly welcomed, the Federal Managers Association and nearly 40 other organizations urged Congress to increase funding for the Social Security Administration (SSA) over the FY08 level in the CR, but the request was not included in the final bill. Funding the agency at FY08 levels, as opposed to the President’s budget request of $10.327 billion, continues the chronic underfunding of an agency that provides benefits to 60 million people annually. Due to an unprecedented backlog of over 767,000 requests for a hearing, an increase in funding to hire additional staff is necessary to bring processing times below 500 days.

“This is certainly a disappointment for all Americans, especially those unable to receive their Social Security benefits in a timely manner,” FMA National President Darryl Perkinson stated. “For the next five months, and possibly for the remainder of fiscal year 2009, SSA will be forced to take a step backwards, instead of moving forward. Simply put, the American people deserve better service.”

Congress is expected to adjourn today, remaining out of office until at least the conclusion of November’s elections; however, as of press time, Congress is still working on a financial bailout proposal. Whether or not Congress will return for a lame duck session after the election remains to be seen, and we will provide updates as we monitor the situation.

For more information on the CR please visit: thomas.loc.gov.

DEFENSE AUTHORIZATION REACHES PRESIDENT

Also on September 27, the Senate passed the FY09 Defense Authorization bill, S. 3001, clearing the measure for final approval by the President. The House version of the bill, H.R. 5658, passed on May 22 but stalled in the Senate as Republicans refused to address the bill due to issues involved in unrelated energy legislation. The passage of S. 3001 this weekend marked the culmination of over four months of deliberation.

The legislation authorizes $612 billion for the Department of Defense (DOD) and Energy Department national security programs funding in FY09, including $68 billion for costs related to the wars in Iraq and Afghanistan. The bill also approves a 3.9 percent pay raise for members of the military, half a percentage point over Bush’s request. The bill also provides for significant bonuses in order to increase recruitment and provide incentives to remain in service, and $125 billion was provided for military personnel for pay, allowances, bonuses, death benefits, and station relocation.The Defense Health Program will receive funds totaling $25 billion, $1.4 billion above Bush’s request. $1.2 billion will be allocated to prohibit any increase in TRICARE fees over the course of 2009.

Originally, the legislation contained provisions which would halt any public-private competitions at DOD for three years. The provisions were removed, however, among veto threats from the White House.

For more information on the bill, please visit: http://thomas.loc.gov.

HOUSE COMMITTEE ADDRESSES LOOMING TRANSITION

As the Bush administration prepares to vacate the White House, congressional leaders continue to emphasize the importance of adequate transition preparation. The House Oversight and Government Reform Subcommittee on Government Management, Organization, and Procurement assembled two panels of agency supervisors and independent observers of government structure to discuss the current state of readiness and offer prescriptions for advancing streamlined power-exchange. Entitled, “Passing the Baton: Preparing for the Presidential Transition,” the hearing held on September 24 expanded on a previous hearing held two weeks earlier in the Senate.

The first panel consisted of Government Accountability Office Acting Comptroller General Gene Dodaro, Office of Management and Budget Deputy Director for Management Clay Johnson, III, and General Services Administration Chief Human Capital Officer Gail Lovelace, all of whom testified at the Senate hearing mentioned above. The second panel featured Towson University political science professor Martha Kumar, National Academy of Public Administration President and CEO Jennifer Dorn, University of Pennsylvaniagovernment professor Don Kettl, and Council for Excellence in Government President and CEO Patricia McGinnis.

In his opening statement, Subcommittee Chairman Edolphus Towns (D-N.Y.) likened the upcoming presidential transition to an Olympic relay race: government agencies, like sprinters, may give their best individual effort, but without cooperation, the ultimate goal will be lost. If agencies are unable to coordinate their strategies with each other and the two presidential candidates, dropping the baton so to speak, any individual success will be overshadowed by collective failure. The Subcommittee encouraged the witnesses to detail past experiences with presidential transitions and offer their prescriptions for how to best secure an efficient and effective transition process. Rep. Brian Bilbray (R-Cali.) underscored the Subcommittee’s belief that a failure to act in a timely manner during this period could hinder the long-term success of the next administration.

Johnson , Dodaro, and Lovelace emphasized that measures are in place to adapt and respond to the challenges presented by this transition. The unique and complex nature of this transition, Johnson stated, requires that the current administration work with both presidential candidates, the first time to his knowledge that such a degree of coordination has taken place. Rep. Towns was especially concerned with oversight of political appointees, to which Johnson and Dodaro responded with assurances that the proper bodies are in place to ensure that accountability is demanded. Rep. Bilbray also noted that in 2000, several isolated members of the outgoing Administration were physically destructive during their exit, acting in a childish manner by engaging in such acts as the destruction of computer parts. While Johnson said such actions were not widespread and were contained primarily to physical nuisances, similar behavior will be monitored more closely to reduce any delays that could impede a streamlined transition process.

Other topics of concern voiced by the Subcommittee included the oversight of contractors and the effect of a Continuing Resolution (CR). Both panels concluded that oversight of contractors should remain a top priority, and that Congress must be vigilant to ensure taxpayers’ money is not wasted, especially during this time of financial insecurity. Addressing the CR, Johnson stated that many agencies would be forced to shift money around to handle the transition.

For more information on the hearing, please visit: http://oversight.house.gov/.

LAWMAKERS DISCUSS DOMESTIC PARTNERSHIP BENEFITS ACT

As the nation’s largest employer, the federal government espouses itself as a leader in fair and equitable hiring practices. A multitude of programs and oversight agencies ensure that citizens are afforded an equal opportunity to enter the civil service. However, federal employees engaged in same-sex relationships argue that discrimination in the workforce is still prevalent in the form of benefits denied to their partners. On September 24, the Senate Committee on Homeland Security and Governmental Affairs convened to discuss S. 2521, the Domestic Partnership Benefits and Obligations Act of 2007, a bill sponsored by Senator Joe Lieberman (I-Conn.) that would extend federal benefits to the domestic partners of same-sex couples.

Office of Personnel Management (OPM) Deputy Director Howard Weizmann, IBM Business Development Executive Yvette Burton, National Treasury Employees Union National President Colleen Kelley, American Federation of Government Employees Program Manager for Women’s and Fair Practices Sherri Bracey, and Federal Deposit Insurance Corporation Deputy Regional Director Frank Hartigan provided the Committee with expert testimony on the subject.

Senator Lieberman delivered a passionate opening statement in which he criticized the federal government for not addressing this issue further. As the employer of over 30,000 men and women engaged in same-sex relationships, the government has chosen to ignore the fact that it is denying so many dedicated civil servants these basic benefits, Lieberman stated. Nearly 20 percent of federal employee compensation comes in the form of benefits, he continued, and these benefits serve as a primary tool for recruiting and retaining the best possible workforce. Lieberman informed the audience that over 50 percent of Fortune 500 companies offer full benefits to the same-sex partners of their employees, a figure that puts the federal government to shame. Beyond believing that the bill is the fair and right thing to do, the Committee argued that the management advantages alone make the extension of benefits necessary. Lieberman also pointed out that incorporating these couples into the benefits program will increase the overall cost by less than one half of one percent.

Weizmann reported to the Committee that OPM objected to the bill based on concerns that fraud could run rampant due to the verification requirement. OPM requires heterosexual couples submit state-issued marriage certificates if the allocation of benefits is questioned, but no such documents exist in states that do not recognize same-sex marriages. Sworn affidavits would have to serve as proof of relationship under S. 2521, and Weizmann stated that the risk of deceit was too great for OPM to support the bill.

The Committee turned to Ms. Burton for her analysis as an executive of a large private sector business. Burton informed the Committee that IBM developed models to determine the costs and benefits of extending their benefits package, determining that it was in the company’s best interest to offer all of their employees the same benefits. Not only are the recruiting and retention benefits obvious, Burton argued, but the working environment is improved as workers engaged in these relationships spend less time worrying about their financial state. By extending their benefits package, IBM has enjoyed across the board success.

Members of the panel discussed various instances of acquaintances affected by the denial of benefits. Hartigan, an openly gay federal director, offered a succinct yet telling statement to the Committee, “If I was starting out in today’s job market, would I take a job with the federal government knowing what I know about domestic partnership benefits? I believe I would look elsewhere.” He told the Committee that there are many more individuals that look to the private sector because the federal government does not offer them the full benefits package.

For more information on the hearing, please visit: http://hsgac.senate.gov.

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WHAT’S NEW IN THE EXECUTIVE BRANCH?

DEPARTMENT OF DEFENSE ISSUES NSPS REGULATION CHANGES

The Department of Defense (DOD), in conjunction with the Office of Personnel Management (OPM), issued new final regulations amending procedural operations of the National Security Personnel System (NSPS), a pay-for-performance program adopted by DOD in fiscal year 2004. The proposed changes, governing compensation, classification, and performance management, are drawing greater criticism to an already controversial program. Announced September 26 as part of the FY08 National Defense Authorization Act,(P.L. 110-181), the regulations will become effective 60 days after publication.

According to NSPS documents detailing the changes, NSPS will follow federal rules for labor management relations, adverse actions and employee appeals of said actions, staffing and employment, and workforce structuring. DOD first published proposed regulation changes in the Federal Register on May 22, 2008, and the final regulations, states DOD, reflect issues raised in public comments following publication and lessons learned from past experiences with the program.

A fact sheet produced by DOD and OPM states, “While Congress made significant changes to the underlying NSPS statute, the core features of NSPS remain essentially intact, including the pay banding and classification structure, compensation flexibilities, and pay for performance system.” Outcry over the changes stem from the belief that the entire system must be overhauled and that to this point NSPS has only succeeded in limiting collective bargaining rights for DOD employees.

Complaints over the transparency of NSPS, however, are addressed in the final regulations, as agencies will be required to share average performance ratings, distribution, and payouts with their employees.

The Pentagon hopes to continue converting employees to NSPS this fall even as objections to the system intensify. Already 183,000 employees have transitioned to NSPS, and DOD insists NSPS remains a valuable tool to recruit and retain the best and brightest labor force.

“NSPS continues to provide the Department with a modern, flexible, and agile human resources management system that preserves employee protections and benefits,” the Pentagon stated. “The Department is committed to ensuring our employees, supervisors, and managers have available appropriate tools to understand the system and their respective roles and responsibilities.”

For more information on the final regulations, please visit the Defense Department Web site at: www.defenselink.mil.

OPM ANNOUNCES FEHBP PREMIUM INCREASES

The Office of Personnel Management (OPM) announced that employees enrolled in the Federal Employees Health Benefits Program (FEHBP) will face premium costs averaging a 7 percent increase in 2009. While premium increases vary depending on the health plan selected, the average employee’s premium cost will rise 7.9 percent, while the government’s portion will rise 6.5 percent. Both figures are dramatic increases over last year’s numbers.

Enrollees with self-only coverage will pay, on average, $4.83 more each pay period (about $125 per year) next year. Family coverage will cost an average $11.12 more per pay period. Federal employees pay 28 percent of premiums, while the government covers the remaining 72 percent.

FEHBP is regarded as one of the strongest benefits programs available and plays a key role in recruiting citizens to public service. Employees enrolled in FEHBP may select from 269 providers in 2009, with nearly 60 percent of enrollees currently signed on with Blue Cross Blue Shield. OPM is expected to unveil a new Web site in early November to assist federal employees in choosing what plan best fits their needs.

The premium increase facing FEHBP members in 2009 is the largest since 2005 and may be indicative of the healthcare dilemma facing our entire nation. OPM was able to reduce the average increase in 2009 by 3.1 percent through the use of reserve funds, but the agency was unable to remain close to last year’s increase which stood at 2.1 percent. A spokesman for OPM assured enrollees that while premium costs were high, the program will continue to provide federal employees with excellent care and customer service.

“These are difficult times we are facing financially, and federal employees will certainly feel the effect of the premium increase,” said FMA National President Darryl Perkinson. “We must work harder to lower costs while still expanding the coverage of healthcare options available to federal workers and their families.”

The Federal Benefits Program Open Season for 2009 will be held government-wide November 10 through December 8. During this time, federal employees may make changes to their health care coverage. For more information on the premium increase, please visit the OPM Web site at: www.opm.gov.

GAO REPORT HIGHLIGHTS NSPS FAULTS

For over two years, the Department of Defense (DOD) has enrolled many of its employees in a compensation program designed to reward workers based on their performance. The National Security Personnel System (NSPS) was considered a revolutionary management tool and key to improving agency efficacy when first developed. A recent report released by the Government Accountability Office (GAO), however, indicates that federal employees enrolled in the program are less than pleased with its current implementation.

While the DOD heralds NSPS as the next step to recruit, retain, and award the best and brightest civil servants, GAO highlights an internal survey conducted by DOD suggesting another look into the program’s design may be necessary if agencies wish to implement it on a wider scale. The survey revealed that the longer employees are enrolled in NSPS, the less favorable their attitudes are towards the system, specifically in regards to the implementation of program safeguards.

“According to DOD’s survey of civilian employees, employees under NSPS are positive about some aspects of performance management, such as connecting pay to performance. However, employees who had the most experience under NSPS showed a negative movement in their perceptions,” the report states.

In 2006, 40 percent of NSPS employees believed the system would have a positive effect on DOD’s personnel practices. One year later, the amount of employees sharing that belief dropped to 23 percent. Many factors contributed to this decline, including the large amount of time required to grasp the intricate details of the process.

DOD has conducted multiple surveys to gain a greater perspective on the program’s progress, and the Office of Personnel Management encouraged DOD to use those results to guide further development of NSPS. According to GAO, DOD has failed to develop a strategy to address employee concerns. The report strongly encourages DOD to consider greater interaction with NSPS employees to modify the program in response to the overwhelming consensus of unfavorable perceptions.

“DOD’s implementation of a more performance- and results-based personnel system had positioned the agency at the forefront of a significant transition facing the federal government,” the report concluded. “NSPS is a new program and organizational change requires time for employees to accept the system. That said, DOD civilian employees will continue to question the fairness of their ratings and will lack confidence in the system until DOD develops an action plan and takes specific steps to mitigate negative employee perceptions of NSPS.”

For more information on the report, GAO-08-773, please visit: www.gao.gov.

GOVERNMENT 2.0 INCREASES PUBLIC PARTICIPATION

A new study produced by Primavera Systems, Inc., an independent provider of collaborative project, resource and portfolio management solutions, in conjunction with O’Keefe & Company, a Virginia-based marketing agency, sheds greater light on how both the general public and federal managers alike perceive the value of government services and how both demographics believe the management practices of federal agencies should be altered. The report reveals the overwhelming sentiment held by both groups that the next administration must emphasize greater management of government programs, largely through a broader application of government-public communication technology.

Primavera surveyed 3,868 members of the general public in July 2008, and 382 federal managers in August for the study, which was published on September 22. According to the report, roughly one-third of federal managers believe tax dollars are wasted or mismanaged, while 42 percent of the general public holds the same belief. The study found that only 17 percent of managers would give their agencies an “A” for effective management practices, with 47 percent of the federal managers surveyed recommending development of a more effective management program during the next administration. Federal managers and the public alike fear that the presidential transition will hamper government performance accountability and reform, according to the report.

Through these findings, Primavera Systems, Inc. and O’Keefe & Company determined that to improve relations between the general public, federal managers, and the federal government, increased communication and greater visibility into government operations must be advanced. According to the report, the individuals surveyed are calling for Government 2.0, whether they know what the term means or not.

Government 2.0 is a concept that emphasizes greater participation in government through the use of Web-based technology. In recent years, the Internet has evolved from a static system into an interactive social space promoting dialogue among participants. Government 2.0 encourages the use of the Internet as a medium to engage in issues of governance. The general public is now able to monitor the actions of its elected officials, leading to a greater demand for accountability and efficiency in the federal government. More and more information is now made public thanks to technological advancements, bringing many Americans out of the dark when it comes to the day to day processes of their government.

The study concluded that the demand for Government 2.0 is widespread and continued development of the system is a necessity. Failure to promote the Web-based tool will result in continued distrust of the government by federal managers and the general public alike. According to the report, the incoming administration has the unique opportunity to engage the American people in the political process to a degree never realized before. The primary obstacle right now, revealed by the study, is that people are continuing to call for a means to increase public insight into government operations when such a tool already exists. The promotion of Government 2.0 as a limitless instrument is vital to achieve maximum engagement.

For more information on the study, please visit: http://www.primavera.com.

AGENCIES ACTIVE IN USE OF HIRING FLEXIBILITIES

An Office of Personnel Management (OPM) report released on September 22 found that agencies are spending more money than ever on bonuses to recruit, retain, and relocate federal employees. Agencies spent over $207 million in 2007 on incentives addressing these issues, representing a significant increase over the previous calendar year. Most of the 41 agencies surveyed reported the increase in payments were necessary to remain competitive with the private sector.

In a letter accompanying the report, OPM acting Director Michael Hager stated, “The mission of OPM is to ensure the Federal Government has an effective civilian workforce. In light of the upcoming retirement wave and the increasing competition for talent we face, it is crucial for agencies to have the necessary human capital flexibilities to attract and retain the talent they need to meet their specific agency missions.” He continued, “OPM has led the way to encourage agencies to implement effective human capital strategies to attract and retain highly qualified individuals for Federal service.”

According to the report, 32,484 individual incentive payments were made in 2007, with each payment averaging $6,394. The majority of the payments were directed towards retention, totaling $127 million. Roughly $57.5 million was spent on recruiting efforts, while relocation incentives totaled $23.1 million. The amount of money allocated for relocation incentives increased 100 percent between calendar years 2006 and 2007.

OPM reported that most of the incentives paid by agencies were directed towards employees serving in occupations “critical to agency missions, such as health care, engineering, security, and information technology.” Agencies also allocated 53 percent of recruitment incentives paid to General Schedule (GS) employees for entry-level positions. The bulk of relocation payments at the GS level were offered to employees in intermediate- and upper-level positions.

The Department of Defense (DOD) used all three incentives to the greatest degree, citing the need to bridge the pay gap between federal and private sector salaries. DOD used incentives to recruit recent college graduates, retain highly skilled scientists and engineers, and relocate valuable employees to remote locations. DOD was also able to extend many employees’ critical assignments through the use of these benefits. Other agencies followed the example set by DOD, drastically increasing their use of incentives to advance their goals.

For more information on the OPM report, please visit: www.opm.gov.

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GET INVOLVED AT THESE EVENTS!

CEC TO CELEBRATE 30TH ANNIVERSARY OF CIVIL SERVICE REFORM ACT

On October 14, the Coalition for Effective Change, of which the Federal Managers Association is a member, will be hosting an event celebrating the 30th Anniversary of the Civil Service Reform Act. Paul Light will kick off the event at the National Academy of Public Administration, which will start at 8 am and will feature two panels after Light’s speech. The first panel will take a look back at where we’ve been over the last 30 years. Conversely, the second panel will focus on the future of the civil service.

Additional details, including how to participate, will be available in the coming days. Please continue to check FMA’s Web site, www.fedmanagers.org, for the most up-to-date information.

DEFENSE FINANCE ANNUAL TRAINING CONFERENCE

From October 27-29 at the Sheraton Crystal City Hotel in Arlington, VA, the Department of Defense (DOD) will host its annual Defense Finance training conference. Assisting in transforming financial operations to better support the war fighter, the conference enables attendees to meet face-to-face with high-ranking executives from the armed forces, DOD, Business Transformation Agency (BTA) and other agencies to share best practices regarding the latest Financial Management updates and new DOD transformation imperatives.

Conference sessions and networking functions provide an unparalleled opportunity to prepare for the coming fiscal year and meet key transformation objectives. Mark the dates in your calendar today!

For more information and access to the Defense Finance 2008 conference agenda, please visit: www.defensefinanceusa.com, or email defensefinance@wbresearch.com.

HUMAN CAPITAL MANAGEMENT SYMPOSIUM: FEDERAL 2008

The Premier Federal Symposium on Human Capital Management

The Federal Managers Association strongly encourages attendance at the Human Capital Management Symposium: Federal 2008, designed to strengthen and streamline the developments and efforts within human capital management in the federal government. The conference takes place on November 19-21, 2008, at the Sheraton National Hotel in Arlington, VA . Attendees will hear detailed case studies of programs that have been implemented, as well as best practices , and panel discussions in which participation is encouraged, enabling you and your colleagues to bring ideas and solutions back to the office to enhance the initiatives and developments within your agency . FMA is proud to cosponsor this high-quality conference.

For more information , please visit www.HCMFederal.com.

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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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