Agencies' FY 2015 budget planning 'tied up in knots' by uncertainty

The budget situation for fiscal 2014 is still murky. Funding for the current year runs out Sept. 1, there's no word on a budget or even a stopgap continuing resolution and the across-the-board sequestration cuts are still threatening to gum up the works.

But, believe it or not, agencies are already planning for their 2015 budgets. Preliminary plans are due to the Office of Management and Budget next month.

But with no funding deal in sight for the next fiscal year, how can agencies already be planning for the following year?

"I think it's safe to say, agencies are used to this situation," said Robert Shea, a former OMB official in the George W. Bush administration and now a principal at Grant Thornton in an interview on In Depth with Francis Rose.

Agencies have, by and large, become inured to widespread budget uncertainty, Shea said. For example, last year, there were five stopgap funding measures, which kept government spending afloat in the absence of a full-year budget. The year prior, there were eight.

OMB has also provided exhaustive guidelines for agencies as they plot out their budgets.

In May, the Office of Management and Budget released guidance directing agencies to cut discretionary spending by 10 percent by targeting low-priority programs.

But while it's possible for agencies to plan budget reductions amid so much uncertainty, it's still not an optimal situation.

Congress returns to Washington from its August recess in a few weeks, but House and Senate leaders and appropriators have been mum, so far, on any funding deal that spells out how to deal with sequestration.

Still, even that seems a remote possibility, Shea said. "I hate to be a pessimist, but I think we're likely to see FY '14 and '15 look a lot like '13."

-Jack Moore, FederalNewsRadio.com
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Department of Defense to Use Invoice Processing Platform (IPP) for Intra-governmental Buy/Sell Transactions

In 2012, Treasury launched a proof-of-concept pilot using IPP to help federal agencies manage intra-governmental buy/sell transactions. Several agencies participated in the pilot, including the Department of Defense (DoD), who found that IPP helped increase visibility into intra-governmental buy/sell transactions, as well as helped with difficult, labor-intensive reconciliation and elimination efforts.

On August 5, 2013, the Under Secretary of Defense (Comptroller) issued a memo that it is partnering with the U.S. Department of the Treasury to implement the Invoice Processing Platform as DoD’s core system to manage all inter- and intra-governmental transactions and documentation. According to the memo, this partnership will strengthen management and accountability for nearly $273 billion in intra-governmental business.

The phased implementation will initially include only DoD-to-DoD transactions. At a later date, transactions between DoD and its civilian trading partners will be included. Excluded from this effort are commercial transactions (which will continue to be managed using DoD’s Wide Area Workflow) and DoD's interfund transactions.

The buy/sell process between government agencies has been fraught with challenges. A 2013 GAO audit of the U.S. Government's Fiscal Years 2012 and 2011 Consolidated Financial Statements (report GAO-13-271R) found a $20.2 billion difference in intra-governmental buy/sell activity and balances. It also revealed that the reconciliation process for buy/sell transactions was difficult and labor intensive.

IPP supports more efficient intra-governmental buy/sell transactions between federal agencies by helping ensure consistent communication between trading partners and providing visibility into each stage of the transaction.

To view the DoD memorandum regarding the implementation of IPP for intra-governmental buy/sell reimbursable transactions, please visit:http://www.ipp.gov/downloads/DoD_Memo.pdf

For more information on the DoD IPP intra-governmental buy/sell implementation, contact the DoD Business Integration Office (BIO)

at (703) 697-1096.

For more information on IPP’s intra-governmental capabilities, contact Michael Bolin at michael.bolin@fms.treas.gov.

For more information about the features and benefits of IPP’s intra-governmental module, visit: http://www.ipp.gov/about-ipp/intra-governmental.

- Federal Reserve Bank of Boston / Treasury FMS
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OMB proposes federal grant management changes

The Office of Management and Budget has proposed consolidating the process that awards more than $600 billion annually in federal grants and financial assistance.

The proposals from OMB, published to the Federal Register on Feb. 1, seek to combine multiple sets regulations into "into a single, comprehensive and streamlined uniform policy guide," says OMB Controller Danny Werfel.

He says OMB published potential grant reform ideas in February 2012 and that comments on those plus input from the Council on Financial Assistance Reform were used to develop this proposal.

Proposed changes and measures include:

• combining eight OMB grant guidance documents into one that clarifies important differences for different agencies;
• allowing applicant risk assessments to be conducted at any point prior to an agency making an award;
• notices of funding opportunities will need to be open for a minimum of 30 days on grants.gov "unless required by statue or unless exigent circumstances dictate otherwise;"
• provide guidance to increase oversight of grant sub-recipients;
• limiting compliance requirements to seven areas that OMB feels, if violated, pose the greatest risk for waste, fraud or abuse; and
• concentrating audit resolution and oversight on higher dollar and higher risk awards.

The office says it is interested in broad public feedback and will use comments to develop a refined final guidance document. The comment period ends on May 2, 2013.

The reforms support both a November 2009 executive order to reduce improper payments and eliminate waste and a February 2011 memo promoting administrative flexibility, says Werfel.

-Geoff Whiting, FierceGovernment.com
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Viewpoints: Shared financial services - one size can fit all

March Office of Management and Budget memo to all agency heads, called “Improving Financial Systems Through Shared Services,” signals further movement to shared services for common financial systems and operations and an emerging acceptance that one size can fit all.

We’ve heard this before, but it hasn’t come to fruition. What will be different today? Key developments are changing the landscape. 

First, technological advances allow us to more easily leverage the benefits of shared services. 

Second, facing difficult budget limits and an administration committed to changing a culture of expensive, customized systems, agencies have little choice but to embrace shared services. 

Third, high-performing finance organizations recognize they can add greater value by supporting program and enterprise management through more analytic roles, and by reducing costs by moving to shared service providers (SSPs) for routine transaction processing.

A concerted move to SSPs will require truly transformative change. It won’t happen overnight, and people, processes and procedures will need to be re-examined and adapted to a more efficient and productive way of doing business. 

We suggest 10 actions to help pave the way: READ MORE...

-Jeffrey Steinhoff and David Fitz, FederalTimes.com
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Federal shared services takes hold through Uncle Sam's List

Uncle Sam's list is up and running, and is one example of how shared services is taking hold across government.

Lisa Schlosser, the federal government's deputy chief information officer, said the website lists more than 100 shared services and more are on the way.

The Office of Management and Budget called for the creation of Uncle Sam's list as part of its shared services implementation guide released in April.

Uncle Sam's List is an internal community within the MAX.gov collaboration site that is maintained by the CIO Council's Shared Services subcommittee.

The list provides information on IT shared service areas, providers and related existing contract vehicles.

The fact that in a few short months agencies are populating the site with shared services shows the impact of OMB's strategy, which it released in May 2012.

OMB also established the Shared Services Executive Council of all the providers. She said the group shares best practices and discuss where the value of shared services is coming from.

She added the broader definition of shared services is helping agencies get their arms around the concept better. OMB is encouraging agencies not just to look at the shared service providers for human resources or financial management, but look at consolidating systems or contracts internally too.

One example is the Commerce Department, which reduced the number of contracts to buy computers.

The agency said it's paying 35 percent less for desktop computers than it did previously, and is saving more than $200 million on administrative costs more broadly.

Agencies are finding those opportunities in two ways.

Schlosser said PortfolioStat continues to bring the CXO community together to prioritize opportunities.

Secondly, agencies submitted to OMB an enterprise roadmap earlier this year as required under the May 2012 strategy.

-Jason Miller, FederalNewsRadio.com
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