[House Report 113-268]
[From the U.S. Government Publishing Office]
113th Congress Report
HOUSE OF REPRESENTATIVES
1st Session 113-268
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OPM IG ACT
_______
November 15, 2013.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Mr. Issa, from the Committee on Oversight and Government Reform,
submitted the following
R E P O R T
[To accompany H.R. 2860]
[Including cost estimate of the Congressional Budget Office]
The Committee on Oversight and Government Reform, to whom
was referred the bill (H.R. 2860) to amend title 5, United
States Code, to provide that the Inspector General of the
Office of Personnel Management may use amounts in the revolving
fund of the Office to fund audits, investigations, and
oversight activities, and for other purposes, having considered
the same, report favorably thereon without amendment and
recommend that the bill do pass.
CONTENTS
Page
Committee Statement and Views.................................... 2
Section-by-Section............................................... 4
Explanation of Amendments........................................ 4
Committee Consideration.......................................... 4
Application of Law to the Legislative Branch..................... 4
Statement of Oversight Findings and Recommendations of the
Committee...................................................... 4
Statement of General Performance Goals and Objectives............ 4
Duplication of Federal Programs.................................. 4
Disclosure of Directed Rule Makings.............................. 5
Federal Advisory Committee Act................................... 5
Unfunded Mandate Statement....................................... 5
Earmark Identification........................................... 5
Committee Estimate............................................... 5
Budget Authority and Congressional Budget Office Cost Estimate... 5
Changes in Existing Law Made by the Bill as Reported............. 6
Committee Statement and Views
PURPOSE AND SUMMARY
The Office of Personnel Management (OPM) provides various
services to federal agencies on a reimbursable basis, including
background investigations for individuals with access to
classified information, leadership training, and human resource
management. For these services, OPM enters into interagency
agreements with customer agencies, deposits customer agency
funds into its revolving fund, and accesses the fund to pay for
delivery of such services as well as OPM's related
administrative expenses. OPM serves as the regulator for rules
affecting the management of federal workers, but through its
revolving fund has also evolved into a fee-based service
provider that provides approximately $2 billion each year in
services to the very same agencies governed by OPM's management
rules.
H.R. 2860 will improve the OPM Inspector General's (IG)
oversight of OPM's revolving fund activities by allowing the
OPM IG to use a portion of revolving fund monies to pay for
related audit and investigative work. H.R. 2860 limits the
amount available to the OPM IG to one-third of one percent of
the revolving fund budget, and requires the OPM IG to submit an
annual budget request and report detailing its revolving fund
oversight work.
BACKGROUND AND NEED FOR LEGISLATION
OPM's revolving fund was established in 1952 to enable the
agency to finance reimbursable background investigations for
federal agencies.\1\ In 1969, Congress authorized use of the
revolving fund to finance reimbursable training courses for
federal agencies.\2\ In 1996, Congress expanded revolving fund
activities to cover personnel management services performed at
the request of federal agencies.\3\
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\1\P.L. 82-375.
\2\P.L. 91-189.
\3\P.L. 104-208.
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The two largest revolving fund programs are Federal
Investigative Services (FIS) and Human Resources Systems (HRS).
FIS conducts background investigations for more than 100
federal agencies to determine employees' or potential
employees' suitability for federal civilian, military, and
contract employment, as well as their eligibility to access
certain classified national security information. Currently,
FIS conducts more than 90 percent of the background
investigations for government employees and contractors,
including for the Department of Defense.\4\ HRS provides an
array of human resources products, including human resource
strategy and evaluation solutions, a federal staffing group and
a vendor management branch.
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\4\http:// www.opm.gov/ investigations/ background -
investigations.
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Since its 1996 expansion to cover personnel management
services, OPM has experienced significant growth in the scale
of its revolving fund programs--from $186 million in fiscal
year 1996 to slightly more than $2 billion today. The estimated
revolving fund obligations for fiscal year 2014 will exceed $2
billion, approximately 90 percent of OPM's total funding
request for the year.\5\ Under current law, OPM is required to
set the price for revolving fund programs at a level that
allows the agency to recover the actual cost of administering
the program.\6\ However, the OPM IG's oversight costs are not a
permissible expenditure from the fund.
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\5\U.S. House, Subcommittee on Federal Workforce, U.S. Postal
Service and the Census. OPM's Revolving Fund: A Cycle of Government
Waste, Hearing, June 5, 2013 (Serial No. 113-29), Washington:
Government Printing Office, 2013.
\6\5 U.S.C. Sec. 1304(e).
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For more than 30 years, both GAO and the OPM IG have been
concerned about the management of resources in the revolving
fund. Each has issued a number of reports and audits examining
various, and often recurring, problems.
In 2012, OPM IG Patrick McFarland informed the Committee of
what he described as a ``serious problem'' inhibiting his
ability to perform the duties and responsibilities of his
office. McFarland explained his office was at a point where it
could not meet its statutory obligation to effectively oversee
revolving fund activities. McFarland noted that his office had
been ``inundated with requests from OPM to audit and/or
investigate different parts of Revolving Fund programs,'' from
technical audit work to the continuing flow of allegations
involving falsification of background investigations and abuse
of authority.\7\
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\7\Letter from Patrick E. McFarland, Inspector General, Office of
Personnel Management, to Chairman Darrell Issa, and Ranking Member
Elijah E. Cummings (10 September 2012).
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The President's FY2014 budget request includes a
legislative proposal to allow the OPM IG up to .33 percent of
revolving fund budget authority ``. . . . for the cost of
audits, investigations, and oversight activities of the fund
and the functions financed by the fund, conducted by the
Office's Office of Inspector General.''\8\
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\8\U.S. Office of Management and Budget, The Budget for Fiscal Year
2014, pp. 1162-1163, available at http://www.whitehouse.gov/sites/
default/ files/omb/budget/ fy2014/assets/opm.pdf.
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In 2013, OPM IG McFarland testified before the Federal
Workforce, U.S. Postal Service, and Census Subcommittee,
stating that OPM's revolving fund programs ``have been
operating in the shadows for far too long,'' adding that
``sunshine is the best disinfectant''.\9\
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\9\U.S. House, Subcommittee on Federal Workforce, U.S. Postal
Service and the Census. OPM's Revolving Fund: A Cycle of Government
Waste, Hearing, June 5, 2013 (Serial No. 113-29), Washington:
Government Printing Office, 2013.
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H.R. 2860 provides resources for critical oversight that
can be accomplished at relatively low cost, using existing
funds.
LEGISLATIVE HISTORY
H.R. 2860 was introduced by Representative Blake Farenthold
and Stephen F. Lynch on July 30, 2013.
Similar legislation, S. 1276, was introduced on July 10,
2013, by Senator John Tester, with Senators Claire McCaskill,
Rob Portman, Tom Coburn, and Ron Johnson as cosponsors. On July
13, 2013, the bill was ordered favorably reported, as amended,
by the Senate Committee on Homeland Security and Governmental
Affairs. S. 1276 passed by the Senate by unanimous consent on
October 10, 2013.
Section-by-Section
Section 1. Short title
The short title of the bill is the ``OPM IG Act''.
Section 2. Use of Office of Personnel Management revolving fund for
audits, investigations, and oversight activities
The Office of Personnel Management (OPM) Inspector General
(IG) audits, investigations, and oversight activities relating
to the revolving fund and the functions financed by the fund
may be charged against the fund. The amount available to the
OPM IG for revolving fund-related work would be limited to one-
third of one percent (.33 percent) of the revolving fund
budgetary authority. The OPM IG would be required to submit an
annual budget request and report detailing its planned
revolving fund work.
Explanation of Amendments
No amendments were offered to H.R. 2860.
Committee Consideration
On October 29, 2013, the Committee met in open session and
ordered reported favorably the bill, H.R. 2860, by voice vote,
a quorum being present.
Application of Law to the Legislative Branch
Section 102(b)(3) of Public Law 104-1 requires a
description of the application of this bill to the legislative
branch where the bill relates to the terms and conditions of
employment or access to public services and accommodations.
This bill allows the OPM IG to use a portion of revolving fund
monies to pay for related audit and investigative work. As such
this bill does not relate to employment or access to public
services and accommodations.
Statement of Oversight Findings and Recommendations of the Committee
In compliance with clause 3(c)(1) of rule XIII and clause
(2)(b)(1) of rule X of the Rules of the House of
Representatives, the Committee's oversight findings and
recommendations are reflected in the descriptive portions of
this report.
Statement of General Performance Goals and Objectives
In accordance with clause 3(c)(4) of rule XIII of the Rules
of the House of Representatives, the Committee's performance
goals and objectives are reflected in the descriptive portions
of this report.
Duplication of Federal Programs
No provision of H.R. 2860 establishes or reauthorizes a
program of the Federal Government known to be duplicative of
another Federal program, a program that was included in any
report from the Government Accountability Office to Congress
pursuant to section 21 of Public Law 111-139, or a program
related to a program identified in the most recent Catalog of
Federal Domestic Assistance.
Disclosure of Directed Rule Makings
The Committee estimates that enacting H.R. 2860 does not
direct the completion of any specific rule makings within the
meaning of 5 U.S.C. 551.
Federal Advisory Committee Act
The Committee finds that the legislation does not establish
or authorize the establishment of an advisory committee within
the definition of 5 U.S.C. App., Section 5(b).
Unfunded Mandate Statement
Section 423 of the Congressional Budget and Impoundment
Control Act (as amended by Section 101(a)(2) of the Unfunded
Mandate Reform Act, P.L. 104-4) requires a statement as to
whether the provisions of the reported include unfunded
mandates. In compliance with this requirement the Committee has
received a letter from the Congressional Budget Office included
herein.
Earmark Identification
H.R. 2860 does not include any congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9 of Rule XXI.
Committee Estimate
Clause 3(d)(2) of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison by the
Committee of the costs that would be incurred in carrying out
H.R. 2860. However, clause 3(d)(3)(B) of that rule provides
that this requirement does not apply when the Committee has
included in its report a timely submitted cost estimate of the
bill prepared by the Director of the Congressional Budget
Office under section 402 of the Congressional Budget Act.
Budget Authority and Congressional Budget Office Cost Estimate
With respect to the requirements of clause 3(c)(2) of rule
XIII of the Rules of the House of Representatives and section
308(a) of the Congressional Budget Act of 1974 and with respect
to requirements of clause (3)(c)(3) of rule XIII of the Rules
of the House of Representatives and section 402 of the
Congressional Budget Act of 1974, the Committee has received
the following cost estimate for H.R. 2860 from the Director of
Congressional Budget Office:
November 4, 2013.
Hon. Darrell Issa,
Chairman, Committee on Oversight and Government Reform,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2860, the OPM IG
Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Matthew
Pickford.
Sincerely,
Douglas W. Elmendorf.
Enclosure.
H.R. 2860--OPM IG Act
H.R. 2860 would permit the Office of Personnel Management's
(OPM's) Office of the Inspector General (IG) to receive funding
through the OPM Revolving Fund. The bill also would set a limit
on the funds available. Under current law, the OPM Revolving
Fund provides about $2 billion a year for a variety of
functions, including background investigations to determine an
individual's suitability for a security clearance, but the IG
is not permitted to use those funds to audit and provide
oversight of the fund's finances.
Based on information from the OPM IG, CBO estimates that
implementing this legislation would enable the IG to begin
auditing the OPM Revolving Fund at a cost of $13 million over
the 2014-2018 period, assuming appropriation of the necessary
funds. Enacting the bill would not affect direct spending or
revenues; therefore, pay-as-you-go procedures do not apply.
H.R. 2860 would impose no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act
and would not affect the budgets of state, local, or tribal
governments.
On August 23, 2013, CBO transmitted a cost estimate for S.
1276, the Security Clearance Oversight and Reform Enhancement
Act, as ordered reported by the Senate Committee on Homeland
Security and Governmental Affairs on July 31, 2013. Both bills
contain similar provisions, and their estimated costs are the
same.
The CBO staff contact for this estimate is Matthew
Pickford. The estimate was approved by Theresa Gullo, Deputy
Assistant Director for Budget Analysis.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
TITLE 5, UNITED STATES CODE
* * * * * * *
PART II--CIVIL SERVICE FUNCTIONS AND RESPONSIBILITIES
* * * * * * *
CHAPTER 13--SPECIAL AUTHORITY
* * * * * * *
Sec. 1304. Loyalty investigations; reports; revolving fund
(a) * * *
* * * * * * *
(e)(1) A revolving fund is available, to the Office without
fiscal year limitation, for financing investigations, training,
and such other functions as the Office is authorized or
required to perform on a reimbursable basis, including
personnel management services performed at the request of
individual agencies (which would otherwise be the
responsibility of such agencies), or at the request of
nonappropriated fund instrumentalities, and for the cost of
audits, investigations, and oversight activities, conducted by
the Inspector General of the Office, of the fund and the
activities financed by the fund. However, the functions which
may be financed in any fiscal year by the fund are restricted
to those functions which are covered by the budget estimates
submitted to the Congress for that fiscal year. To the maximum
extent feasible, each individual activity shall be conducted
generally on an actual cost basis over a reasonable period of
time.
* * * * * * *
(5) [The Office] (A) The Office shall prepare a business-type
budget providing full disclosure of the results of operations
for each of the functions performed by the Office and financed
by the fund, and such budget shall be transmitted to the
Congress and considered, in the manner prescribed by law for
wholly owned Government corporations.
(B) Such budget shall include an estimate
from the Inspector General of the Office of the
amount required to pay the expenses to audit,
investigate, and provide other oversight
activities with respect to the fund and the
activities financed by the fund.
(C) The amount requested by the Inspector
General under subparagraph (B) shall not exceed
.33 percent of the total budgetary authority
requested by the Office under subparagraph (A).
* * * * * * *