Federal Managers Association

To view a complete copy of Niehaus’ testimony, please visit FMA’s Web site at: www.fedmanagers.org. For a copy of other witness testimony, please visit: http://federalworkforce.oversight.house.gov.

DC, NATION GEAR UP FOR 25th PUBLIC SERVICE RECOGNITION WEEK

This year’s Public Service Recognition Week (PSRW), the annual celebration honoring the men and women serving our nation as federal, state, county and local government employees, kicks off on May 4, highlighted by a multi-day event held on the National Mall in Washington, D.C. from May 7 – May 10. Celebrated since 1985, PSRW sets time aside for public employees throughout the U.S. and around the world to educate citizens about the work they do and why they have chosen public service careers, as well as the many ways government services make life better for all of us.

The capstone celebration held every year on the National Mall routinely features more than 100 government offices and agencies, nonprofit organizations and private companies sponsoring interactive and educational exhibits that showcase the innovative and quality work performed by public employees. Organized by the Partnership for Public Service and the Public Employees Roundtable, a collection of good government organizations of which the Federal Managers Association (FMA) is a member, this year’s theme is “Government Goes Green,” and the Mall event will feature new large-scale exhibits showcasing how government agencies are working to have a positive impact on the globe through environmentally friendly practices and energy efficient initiatives.

During the four-day celebration, attendees will see government programs in action. Kids can meet NASA astronauts, climb aboard an F-16 fighter, and take home free educational buttons, coloring posters and maps and puzzles. Adults can search online for jobs, check their credit report, receive free health screenings and learn about emergency preparedness.

“As we officially recognize public employees next month, I ask that you do what you can in your workplace and community to remind others throughout the year of what public service means to you,” urged FMA National President Darryl Perkinson. “Our friends and neighbors need to understand our contributions to the nation. Share success stories about your agency or organization to your local media. Most importantly, put a face on public service so that the image of the public servant invokes a sense of honor, respect and commitment.”

For more information on this year’s event, please visit FMA’s Web site and click on the PSRW image on the front page: www.fedmanagers.org.

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WHAT’S HAPPENING ON CAPITOL HILL?

OPM DIRECTOR SETS AGGRESSIVE AGENDA ON CAPITOL HILL

Newly confirmed Office of Personnel Management (OPM) Director John Berry understands the enormous amount of pressure he and his agency are facing only a few weeks into his tenure as the chief architect of the federal government’s human resources agenda. In his statement before the House Oversight and Government Reform Subcommittee on Federal Workforce, Postal Service and the District of Columbia during last week’s hearing on the state of the federal workforce, Berry sought to instill confidence in the eyes of Members on Capitol Hill by pushing an aggressive agenda and promising to promote OPM as an office of change. Although it remains to be seen how he will address the challenges that lie ahead, Berry has formed a list of priorities that may provide a blueprint for his first crack at civil service reform.

Since his nomination hearing before the Senate Homeland Security and Governmental Affairs Committee, Director Berry has cited pay system reformation as his top priority. Highlighting the prevalence of multiple pay systems within single agencies and departments, Berryunderscored the need to consolidate personnel systems to promote equality and transparency in the workforce. An advocate of pay-for-performance, though acknowledging the difficulties associated with appraisal systems, Director Berry expressed his willingness to approach personnel reform with an open mind, seeking to draw on the best aspects of programs currently in place as his office considers development of new systems.

For any personnel program to be successful, Berry asserted, managerial training must receive greater attention. Without effective management, he told the House Subcommittee last week, agencies will continue to run into obstacles posed by a lack of organization on the ground level. Unfortunately, he continued, managerial training programs often face the chopping block when agencies are forced to cut down on their budgets and are the last programs brought back when funding increases. The failure to recognize the value of a well trained manager is a grave mistake agencies have made in the past, Berry concluded.

Many of the positive reorganizational goals OPM has set for the near future will be of little consequence if drastic changes are not made to the federal hiring process, Berry told the Subcommittee. The ability of agencies and their employees to deliver the level of service expected by the public hinges on the capacity to effectively and efficiently recruit, hire, and retain the best and brightest in the federal workforce. Calling the current hiring structure antiquated and unacceptable, Berry assured the Subcommittee he and members of his staff were evaluating options to streamline the hiring process to ensure the government brings the most talented members of the labor force into careers in public service in a timely manner.

Detailing OPM’s “End-to-End Hiring Roadmap” developed in September of 2008, which provides agencies with comprehensive instructions to fill identified job vacancies, Berry expressed his positive outlook on the future of the hiring process.

“We believe the End-to-End Roadmap Hiring Roadmap will help agencies accomplish two essential goals – namely, to give applicants a better experience and to speed the hiring process. OPM will ensure agencies implement the roadmap through meaningful metrics that measure the satisfaction of applicants and managers with the hiring process.”

These are only a few of the challenges Director Berry identified as requiring significant attention, though these may be the first he seeks to address. To track OPM’s progress as the agency undertakes many of the Director’s initiatives, please visit: www.opm.gov. For a copy of Berry’s full written testimony, please visit: http://federalworkforce.oversight.house.gov.

OBAMA, LAWMAKERS CALL ON NATION TO SERVE PUBLIC GOOD

On April 21, President Obama signed the Edward M. Kennedy Serve America Act, P.L. 111-13, legislation the President referred to as an investment by the American people in the nation they call home. The Act creates new public service opportunities for Americans of all ages while calling on all citizens to contribute in some manner to the public good before the end of the President’s first 100 days in office.

“A week from tomorrow marks the 100th day of my administration,” Obama told a crowd in attendance during signing of the bill. “In those next eight days, I ask every American to make an enduring commitment to serving your community and your country in whatever way you can. Visit whitehouse.gov to share your stories of service and success. And together, we will measure our progress not just in the number of hours served or volunteers mobilized, but in the impact our efforts have on the life of this nation.”

The Edward M. Kennedy Serve America Act will more than triple the size of the AmeriCorps, a government organization that promotes public service through a network of nonprofit partnerships, from 75,000 to 250,000 members. Among the myriad of other programs the bill creates or enhances, the Act establishes a Social Innovation Fund which will both expand upon established initiatives designed to address difficult community issues and help foster the creation of innovative approaches to address future challenges.

“Programs like these are a force multiplier; they leverage small numbers of members into thousands of volunteers,” Obama said. “And we will focus their service toward solving today’s most pressing challenges: clean energy, energy efficiency, health care, education, economic opportunity, veterans and military families. We’ll invest in ideas that help us meet our common challenges, no matter where those ideas come from.”

The Corporation for National and Community Service, the nation’s largest grant maker supporting service and volunteering through the AmeriCorps, Senior Corps, and Learn and Serve America programs, will control many of the programs the legislation expands upon. The success of the Act, however, will not hinge on any one government program, Obama announced, but on the willingness of each individual to contribute in some meaningful way to the welfare of the country.

“We need your service right now, at this moment in history. I’m not going to tell you what your role should be; that’s for you to discover. But I’m asking you to stand up and play your part. I’m asking you to help change history’s course, put your shoulder up against the wheel. And if I -- if you do, I promise you your life will be richer, our country will be stronger, and someday, years from now, you may remember it as the moment when your own story and the American story converged, when they came together, and we met the challenges of our new century.”

To view a copy of the legislation, please visit: http://thomas.loc.gov.

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WHAT’S NEW IN THE EXECUTIVE BRANCH?

IRS BOARD: MANAGERS KEY TO AGENCY SUCCESS

As the number of workers with vast institutional experience reaching retirement eligibility continues to rise, and as navigating the complex tax code remains a challenging task, the Internal Revenue Service (IRS) Oversight Board placed bolstering employee engagement among its top priorities in the agency’s 2008 annual report to Congress. The report, which outlines the IRS’s strategic plan for the next five years, identified the need to strengthen incentives to make management positions more desirable while providing improved training for managers and supervisors as a critical component of enhanced employee engagement.

“The IRS must do a better job of recruiting employees, streamlining the hiring process, offering training for managers and incentives to make it attractive to be a manager, and providing career development opportunities for all of its employees, including training and developmental assignments,” the report stated. “Front line management is key to improving employee engagement, and more emphasis on timely training of front line managers is essential.”

Identifying its employees as the agency’s greatest asset, the Board determined that boosting engagement from top officials on down would benefit the IRS and its employees equally, citing numerous studies conducted in both the public and private sectors illustrating productivity and retention gains stemming from employment of such a strategy. With the IRS encountering increasingly worrisome workforce trends, including high attrition rates for new employees along with an exodus of critical skills and knowledge through retirement, the report promoted expanding upon its training and mentorship programs to foster a sense teamwork and pride in job responsibilities while transferring institutional experience to the next generation of civil servants.

“The availability of such training will make the IRS one of the best places to work in the federal government, and provide the catalyst for more employee ownership of their career development,” the report continued. “Quality training and work experiences will go far in attracting the best talent to public service and retaining employees in the long run. Training programs should also incorporate measurement programs so that the effectiveness of training can be quantified.”

The Board also underscored creation of the Workforce of Tomorrow task force, designed to identify methods and techniques to boost recruiting and retention techniques, as a vital asset to the agency’s succession planning. Overall, the report hypothesizes that incorporating all aspects of enhanced employee engagement will encourage employees to stay at IRS longer, use less sick leave and file fewer grievances, all contributing to a more positive work environment.

“It is encouraging to see the IRS recognize what FMA has been saying for years,” Federal Managers Association (FMA) National President Darryl Perkinson responded upon release of the report. “The development of managerial skills is one of the greatest investments an agency can make. With proper training, the entire agency benefits from better supervision and improved leadership.”

For more information on the 2008 IRS report to Congress, please visit: www.irs.gov.  

ROTH OPTION, TSP ADJUSTMENTS GAIN BOARD’S APPROVAL

The Federal Retirement Thrift Investment Board (FRTIB), charged with administering the government’s Thrift Savings Plan (TSP), officially approved establishment of a Roth Individual Retirement Account option for employees enrolled in the federal retirement package equivalent of a 401(k). During the Board’s monthly meeting, the decision was made to endorse creation of the Roth option, as contained in Congressman Henry Waxman’s (D-Cali.) Family Smoking Prevention and Tobacco Control Act of 2009, H.R. 1256, which passed the House in early April.

Establishment of a Roth IRA option would allow administrators to tax participants’ contributions to the TSP, as opposed to the current system where TSP accounts are taxed upon withdrawal. This insulates individuals from future tax increases and provides the federal government with a large upfront influx of funds.

The Board also discussed whether TSP participants should have the option of investing in additional mutual funds outside of the standard funds currently available to investors. The Board eventually split on expanding enrollees’ investment options. Another motion up for debate concerned permitting the spouses of deceased TSP participants to preserve an inherited account. Current law requires spouses to deposit the deceased participants’ funds into individual accounts or accept a lump sum payment subject to heavy taxes. The Board unanimously approved the motion to allow the continued maintenance of TSP accounts.

Although the Board does not contain the power to enact these proposals, their decisions significantly influence lawmakers’ push for legislative action.

The Employee Thrift Advisory Council (ETAC), of which the Federal Managers Association is a member, met shortly thereafter to discuss the Board’s decisions. The ETAC has officially endorsed both the establishment of a Roth IRA option and a rule change affording individuals the ability to maintain their deceased spouse’s TSP accounts.

To view current regulations regarding administration of the TSP, please visit: www.frtib.gov.

RETIREEZ PROGRAM OUTLOOK GRIM

In early 2008, the Office of Personnel Management (OPM) initiated a trial run of its automated retirement modernization system, known as RetireEZ, which sought to replace the paper-intensive procedures federal employees were forced to endure during the retirement process. Failed attempts to adequately address obstacles encountered during the conversion process led OPM to suspend the program and reevaluate how best to proceed with a second attempt to dispel with the current antiquated system. Although OPM has invested substantially in the RetireEZ program to date, a Government Accountability Office (GAO) report published on April 21 indicates the agency remains woefully distant from attaining its objectives as originally planned.

OPM initially developed the RetireEZ program to streamline the disbursement of retirement annuities in anticipation of the forecasted retirement tsunami. In an April 2008 press release following the program’s first rollout wave, OPM stressed the need to transition from the antiquated paper model to an adaptive electronic program to handle the influx of annuitants entering the system in the near future.

“Prior to RetireEZ, retirees in all three branches of government and the U.S. Postal Service could anticipate a period of interim reduced annuity payments upon commencement of their retirement,” OPM stated. “The decades old paper-based administrative process responsible for this poor customer service was destined to deteriorate with the onset of the pending retirement wave. Under RetireEZ, this practice is ending.”

Former OPM Director Linda Springer praised deployment of the RetireEZ program, stating in the same press release that thousands of federal retirees involved in the program’s first run were already benefitting immensely in terms of timely payment delivery. Prior to OPM’s decision to begin phasing in the system, however, GAO advised the agency to further calculate potential risks involved in the transition, specifically recommending a reexamination of the massive technology contracts they were prepared to sign. In May of 2008, OPM encountered problems with the Defined Benefits Technology Solution contract, intended to provide the base technology for the electronic system. OPM terminated the contract and commenced restructuring the system from the ground up.

Nearly a year later, GAO found that OPM has yet to address many of the core issue leading to the initial collapse of the system. A lack of oversight by the agency has contributed significantly to management weaknesses present in the program’s development, GAO determined in its report. OPM continues to lack clear processes and plans to direct redevelopment of the program, which GAO notes fails to fall in line with best practices efforts.

“Until OPM addresses these weaknesses, many of which GAO and others made recommendations to correct, the agency’s retirement modernization initiative remains at risk of failure,” the report states. “Institutionalizing effective management is critical not only for the success of this initiative, but also for that of other modernization efforts within the agency.”

OPM Director John Berry has issued his commitment to place development of a modernized retirement program towards the forefront of his agenda.

To view a copy of the GAO report (GAO-09-529) , please visit: www.gao.gov.

PREVALENCE OF COST-REIMBURSEMENT CONTRACTS PRESENTS RISK

The use of cost-reimbursement contracts increased dramatically during the Bush administration, according to a report released by the Office of Management and Budget (OMB), potentially exposing the government to elevated levels of contractor fraud and abuse. Used primarily for projects necessitating intensive research and development, or for complex assignments where establishing cost estimates may be difficult due to unforeseeable variables, cost-reimbursement contracts create risks the government may be able to avoid with greater examination of their necessity, according to the report.

Cost-reimbursement contracts allow the federal government to pay contractors based on costs incurred during the assignment, as opposed to paying for delivery of a final product. Agencies are restricted in the use of these contracts, as the lack of a fixed-price for the assignment exposes the government to potential risks. According to the report delivered to the Senate Homeland Security and Governmental Affairs Committee, however, the amount of funds agencies allocated for cost-reimbursement contracts increased by over 90 percent during the eight years under Bush. Agencies paid roughly $71 billion in 2000 under these contracts; in 2008, cost-reimbursement contract obligations totaled $135 billion.

“This near-doubling in cost-reimbursement contracts calls into question whether these vehicles are being used excessively or without adequate justification, and whether agencies have the necessary skills and capacity – within both acquisition and program offices – to successfully administer these contracts,” OMB Director Peter Orszag wrote in the report.

In March, President Obama delivered a Memorandum on Government Contracting to agency and department leaders expressing his concern with the potential for misuse and fraud caused by the expanding use of cost-reimbursement contracts, detailing the government’s policy of preference for fixed-price contracts if agencies determine the hiring of a contractor would deliver the most efficient and effective return for American taxpayers. Obama directed OMB to develop guidance by July 1 to assist agencies as they review current contracts to identify and correct waste and other impediments hindering their missions. OMB must also develop guidance to help agencies monitor sole-source and other non-competitive contracts to foster competition by September 30.

“The Administration is committed to ensuring that federal contracts are structured to maximize incentives for successful contract performance,” Orszag concluded in the report. “We look forward to working with Congress on the initiatives outlined above and other efforts to strengthen our acquisition system and the outcomes we achieve from our contracts.”

To view a copy of OMB’s report, please visit: www.whitehouse.gov/omb.

OBAMA PUSHES FOR APPROVAL OF KEY NOMINEES

President Barack Obama has named Jeffery Zients to serve as the government’s first chief performance officer pending Senate approval, a role created to “streamline processes, cut costs, and find best practices throughout our government," according to the President. Zients, who served as CEO and Chairman of the Advisory Board Company and as Chairman of the Corporate Executive Board, two private sector firms specializing in best practice research and executive education, will also fill the role of Deputy Director for Management in the Office of Management and Budget (OMB).

Although not his first selection for the two positions, Obama cited Zients’ wealth of experience in the private sector as advantageous as his Administration seeks to cut costs while promoting efficiency and accountability in government. OMB Director Peter Orszag described Zients in his White House blog as an, “entrepreneur with a deep understanding of business strategy, process reengineering, and financial management” who will play an instrumental role in advancing the Administration’s mission.

“Specifically, Jeff will lead the President’s efforts on contracting and procurement reform, improve government productivity by helping to root out error and waste, build a performance agenda across government, and enhance the transparency of the government’s finances so that citizens are empowered to hold us all accountable for improved stewardship and performance,” Orszag wrote.

Obama ’s first selection for the role, former Assistant Treasury Secretary Nancy Killefer, withdrew her nomination following the discovery of personal tax related issues.

The Administration is still working to fill its last open Cabinet position, Secretary of the Department of Health and Human Services. Secretary-designate Kathleen Sebelius continues to face opposition in the Senate on multiple fronts, as Republicans attacked both her failure to pay taxes as well as her staunch pro-choice sentiments. Sebelius has acknowledged she misrepresented the amount of money she received from a doctor working in an abortion clinic.

For more information on the President’s nominees, please visit: www.whitehouse.gov.

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GET INVOLVED AT THESE EVENTS!

HAVE YOU SIGNED UP FOR THE FMA ADVANTAGES PROGRAM?

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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.

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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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