“More interagency collaboration, greater engagement with stakeholders and seamless interactions between agencies and the public are some of what’s needed for the federal government to excel in the years ahead.“
“That’s according to the Partnership for Public Service, which published a report on the future of IT, the federal workforce and data modernization efforts.
The report, written in collaboration with EY and published Feb. 5, is the product of months of interviews and workshopping with policy makers, industry experts and agency leaders. Some of the solutions addressed common complaints like siloed IT systems, inefficient competition between agencies and unsatisfactory customer experiences. It encouraged agencies to collaborate internally and with other agencies and to increase engagement with private-sector partners and the general public.
“When IT modernization first took place and we started with the Centers of Excellence, it was really about one agency taking a particular problem, solving that problem, and then sharing it,” Department of Agriculture Chief Information Security Officer Venice Goodwine said in a panel discussion on the report. “There’s no need to spend the money building something that’s already been built. To [build an interconnected government], we need to leverage investments that other agencies have already made.”
Goodwine said the ideal model would be having one Center of Excellence for each shared service that could act as the point of contact across the federal government.
Department of Veterans Affairs’ Deputy Chief Veterans Experience Officer Barbara Morton said that as customers have become accustomed to quick, frictionless service from private companies such as Amazon, federal agencies look slow and inefficient in comparison, leading to frustration. Reorienting services to address customers’ needs would be a key first step to changing the government’s reputation as unreliable and inert.
“In the next five or 10 years, the way we meet demand will be by listening and orienting around customers’ needs, rather than putting the bureaucracy first,” Morton said at the panel. “The expectations for us are being set outside of government. … It is our obligation to be able to catch up and meet those new needs.”
Nancy Potok, the former chief statistician for the Office of Management and Budget, concurred, adding that increasing engagement with external organizations would be one solution.
“Agencies should be encouraged to partner with outside companies and entities that are really good at this,” she said. “It’s true that the public has been now very well trained to expect instant service.”
Focusing on customer experience skills during hiring and in employees’ daily work would also help foster accountability and a service-oriented culture so workers can better meet the new demands being made of their agencies.
“When people get supervisor training, they learn the rules. They learn compliance and how to fill out a performance evaluation. That’s not the skill set we need in today’s world,” Potok said. “We shouldn’t let anyone into a supervisory position until we’re sure that they have collaboration skills, that we’ve worked on their emotional intelligence, that they’re problem solvers, that they’re willing to take some risks.”
Agencies like the VA have taken the extra step of not only encouraging those skills in their workers, but actually writing them into official policy.
“In the department, we have core values and characteristics codified into our regulations such as integrity, commitment, advocacy, respect and excellence,” Morton explained. “We amended the regulations to include customer service principles as part of our core values. We updated our [Senior Executive Service] performance metrics as well, to include customer experience. To drive this culture change, to reorient, we need to consider customer service to also be part of our regulations and our core values.”
“This figure is the unit recurring flyaway cost—the price tag for just the aircraft and engine, which by themselves do not make a fully functioning weapon system.
That $89.2 million does not include procurement funds spent on initial spare parts, flight training simulators, the expensive – and poorly performing – ALIS support system, and more, all unique to the F-35.“
“Pentagon leaders are likely reveling in the news that they have negotiated an agreement with Lockheed Martin that they claim drives down the unit cost of the F-35 joint strike fighter to below $80 million in the next few years. While any reduction in costs for the most expensive weapons program in history is an improvement, all is not as it appears in the industry trade press. A quick perusal of publicly available Pentagon budget documents shows the real cost of the F-35 to be above $100 million per copy for the fiscal year 2020 buy. Given the work that remains, and the way the Pentagon has surrendered many key responsibilities to the manufacturer, the price is likely to be at least that amount or higher for the foreseeable future.
The most commonly mentioned figure is for the F-35A, the Air Force’s conventional takeoff variant and the least expensive model. The current estimate for the lot of aircraft currently in production is $89.2 million apiece. This figure is the unit recurring flyaway cost—the price tag for just the aircraft and engine, which by themselves do not make a fully functioning weapon system.
When we also consider the future modifications necessary to correct both the known and potential design flaws and the aircraft’s $44,000 per-flight-hour cost, it is easy to see why the F-35 program is the most expensive in history.
A handy tool for anyone interested in knowing more about actual costs of military programs and weapons is readily available online. The Pentagon posts budget materials for each fiscal year on the comptroller’s webpage. Included are budget estimates and the justification documents containing more charts and figures than any reasonable person would care to view.
The Air Force’s fiscal year 2020 budget pays for the 48 F-35As in Lot 11. The current $89.2 million dollar price the Pentagon uses is calculated by separating out just the costs for the airframe and the engine from the larger total procurement cost that includes ALIS, simulators, initial spare parts, and more to get to the artificially low $89.2 million. That is far from the whole story.
The Pentagon’s own budget documents list the FY 2020 procurement cost for those 48 aircraft as more than $101 million, nearly $12 million more than the figure rolled out for press reports. Using the Navy’s charts and the same math shows that the real costs for each F-35C is more than $123 million, while each F-35B costs in excess of $166 million. But even that figure doesn’t tell the whole story.
None of this factors in the research and development costs of the program. Ellen Lord, the Pentagon’s acquisition chief, announced on October 29 that the program needs more money to complete the developmental and testing phase of the program. The latest publicly available figures show that taxpayers will have spent approximately $55.5 billion for F-35 research and development. If the Pentagon purchases all 2,470 F-35s in the current plan, the true cost of each aircraft goes up by nearly $22.5 million. Program officials had expected to complete development and operational testing by December 2019. But designers and engineers have struggled to complete the Joint Simulation Environment, a highly accurate simulator necessary to complete operational testing. The troubles stem from programming flight data and aircraft performance data gathered during real-world flights into the simulation software. The Joint Strike Fighter program will run out of development money before the simulator and the subsequent operational testing can be completed. The Pentagon expects to announce before the end of 2019 just how much more money beyond the program’s current $406.4 billion budget will be needed to complete this phase of the program.
No matter how the production costs are calculated, that money alone will not buy you a fully functional F-35. Engineers were not able to complete all of the combat capabilities that were supposed to be included as part of the original development phase of the program. This incomplete work, which taxpayers have already paid for, will now be completed in a new development phase and called “follow-on modernization.” Only time will tell how much will ultimately be spent in this effort, but taxpayers are already on the hook for $10.5 billion.
There is also the matter of the cost of maintenance and ownership. Lockheed Martin stands to make most of its money from the F-35 program in annual non-competitive sustainment contracts. As POGO has reported before, the services can’t independently perform many of the most basic maintenance functions on the F-35 and must instead rely on civilian contractors. Lockheed Martin currently receives $2 billion a year to keep the fleet of approximately 400 aircraft flying, meaning the annual operating cost for each F-35 is $5 million.
Pentagon officials had expected to make the long-anticipated full-rate production decision for the F-35 program before the end of this year. Also known as a Milestone C decision, the program must complete all the steps, including operational testing, as required by federal law. No one appears to be letting such trifling details stand in their way, however. The recent cost estimates emerged as part of the announcement of a $34 billion deal for three years’ worth of F-35 production—478 aircraft for the U.S. services and international customers—beginning in 2020. Officials continue to call this “low-rate initial production,” but this is essentially full-rate production in everything but name. The announced 169 F-35s for Lot 14 is the full-rate production figure for the program.
The public shouldn’t fall for the gimmicks the Defense Department constantly uses on aircraft unit cost, but the press, amazingly, seems to fall for it every time. Congress shouldn’t buy these phony cost projections and compound the program’s problems, based on a phony buy-in price by buying more F-35s before testing is complete.”
“Government is losing talent, productivity and taxpayer dollars as agencies often take several months to complete their own investigations of individuals who have already been reviewed and cleared by another federal organization.”
“Ambiguous, layered and outdated policies and practices are preventing federal employees and contractors with security clearances from moving top talent in and around government.
The Intelligence and National Security Alliance [INSA] describes in a recent report the challenges with a concept known as “reciprocity.”
“Reciprocity” refers to the idea that if one agency places trust and grants a security clearance to a federal employee or contractor, most other agencies — generally — should too.
But members of industry have, on multiple occasions, said this isn’t standard practice at some departments, and contractors generally have little insight into where their employees are in an agency’s investigative and adjudication process, INSA said.
Industry leaders say 10% of their cleared contractor workforce within the intelligence community are idle at any given time, because their employees are waiting for an agency to grant, update or transfer a security clearance. INSA estimates these reciprocity delays could total as much as 1,000 lost contractor labor-years and $2 billion a year, assuming an average annual cost of $200,000 per top-secret cleared contractor to the government.
Reciprocity delays across government could amount to some 90,000 lost contractor labor-years, according to INSA’s estimates.
“Industry currently has many thousands of personnel who were cleared on one government contract but who must wait weeks or months before being allowed to work on a new contract,” INSA wrote. “One large firm alone reported that it currently had more than 700 employees waiting for clearance transfers, and that on average its employees wait 94 days for their clearances to be accepted by a new agency.”
The Office of the Director of National Intelligence has tried to provide more clarity. ODNI’s Security Executive Agent issued a directive back in November 2018, which said agencies should “accept” existing security clearances and national security eligibility adjudications and determinations already granted by another executive branch agency.
But directives like this most recent one, INSA argued, give agencies too much room to interpret their own meanings, and in fact, they have.
“Individual agencies created internal policies and procedures based on their own interpretations of [Security Executive Agent] directives,” INSA’s report reads. “At larger agencies like the DoD, sub-departments including the Army, Navy and Air Force have further promulgated their own interpretations of both ODNI and DoD policy. This practice of agency-specific policy interpretation creates a web of inconsistent rules that complicate reciprocal recognition of clearances.”
In addition, the directive doesn’t mention how agencies should handle previous policies on security clearance reciprocity, which have been equally ambiguous on the topic, INSA said.
INSA described 14 recommendations to improve security clearance reciprocity. Many suggestions are detailed and describe highly specific policies and interpretations INSA believes need an update. But taken more broadly, INSA’s recommendations point to several challenges and opportunities to shorten the adjudication process and standardize both longstanding and emerging investigative practices.
“Right now we have a lot of work to do in establishing common standards,” Charlie Allen, a senior intelligence adviser and chair of INSA’s security policy reform council, said in an interview. “On reciprocity, we have significant inconsistency when it comes to policies and standards. We have a lack of transparency and information sharing, which bothers me significantly. The lack of information sharing really creates distrust when we don’t share information as we bring these people on.”
Allen previously served as the first undersecretary for intelligence and analysis at the Department of Homeland Security after a decades-long career at the CIA.
Federal adjudication facilities also need more resources to more quickly sign off on completed background investigations, INSA suggested.
Allen described the adjudication process in general as a “painful and slow process,” and the latest timeliness data from Performance.gov prove his point.
Initial secret and top secret cases on average took 30 and 42 days, respectively, to adjudicate in the second quarter of fiscal 2019, according to a June update on Performance.gov. Periodic re-investigations took 100 days to adjudicate, data which is likely skewed to reflect recent Defense Department policy to forego those reviews in favor of continuous vetting.
Though not new to the intelligence and defense communities, continuous vetting is still an emerging concept for other agencies, and INSA argued it could also open up more uncertainty for security clearance reciprocity.
Adjudications are supposed to be completed in an average of 20 days, according to methodology from the Performance Accountability Council.
The Defense Department’s Consolidated Adjudications Facility has, in part, recognized its challenges to keep up with the National Background Investigations Bureau. But as NBIB has cut the backlog of pending investigatory matters by nearly 40 percent within the last year or so, that pace creates more pressure for DoD’s CAF to adjudicate more cases.
Though INSA described several existing challenges and made more than a dozen recommendations to clear up existing policies and create new ones, the organization is optimistic government will eventually act.
The reform council hosts meetings with industry, congressional staffers and senior government leaders like Principal Deputy Director of National Intelligence Sue Gordon, who discuss these challenges and coming security clearance policy plans. These discussions show all the appropriate parties are interested and engaged in improving the security clearance process, Allen said.
ODNI and the Office of Personnel Management are working on a top-to-bottom overhaul of the suitability, credentialing and security clearance processes as part of a “Trusted Workforce 2.0” initiative.
New standards for denying, suspending and revoking federal credentials were due last summer but new deadlines have been set, according to the recent Performance.gov update.
These initiatives, as well as the administration’s plans to transfer the entire security clearance, suitability and credentialing enterprise from OPM and NBIB to the Pentagon, has industry feeling optimistic about the prospects for true modernization.
“I believe it can be done,” Allen said. “The White House has to stay engaged. It can’t be something the White House throws over the fence.”
Some members of Congress have also recognized the need for modernization.
Sen. Mark Warner (D-Va.) is the author of several provisions designed to ensure agencies are meeting reciprocity guidelines and more easily transfer cleared individuals in and around government.
These provisions are part of the 2020 defense authorization bill, which cleared the Senate late last month.”
“The Pentagon is weighing legislation that would give contracting officers the power to demand back-up data on spare parts costs after its inspector general said TransDigm Group Inc. could be paid about 9,400% in excess profit for a half-inch metal pin.The Defense Logistics Agency could end up paying TransDigm $4,361 for the “drive pin” in a July contract that should cost $46, according to a Pentagon review endorsed by the inspector general.
As the Pentagon weighs whether to recommend legislation to require more disclosure by contractors, the House Committee on Oversight and Reform will review the audit and TransDigm’s pricing policies in a hearing on Wednesday.
The inspector general’s report “exposes how a company entrusted with supporting our military men and women took advantage of American taxpayers by overcharging the government more than $16 million” in parts sales sold between 2015 and 2017, Oversight Chairman Elijah Cummings said in a statement. The hearing will “investigate whether these pricing issues are more widespread, and demand answers,” he said.
From 2013 through 2015, according to the audit, the contractor increased the price of a valve that opens and closes to change the pressure of fuel moving through an engine to $9,801 from $543. In those years, TransDigm also charged $1,443 each for a “non-vehicular clutch disk” that cost $32 to make.
The Pentagon’s inspector general first raised pricing concerns over TransDigm in a 2006 report, followed by the one this year that was released in redacted form in February.
TransDigm manufactures spare parts for airplanes and helicopters including the AH-64 Apache, C-17 Globemaster III, F-16 Fighting Falcon and the CH-47 Chinook. From April 2012 through January 2017, DOD issued 4,942 contracts valued at $471 million to TransDigm.
Liza Sabol, a spokeswoman for the Cleveland-based company, said in an email “that we are not providing comments on specific questions related to the IG report.”
“TransDigm has been and remains committed to conducting business within the framework of applicable laws and regulations,” she said. “The IG report does not make any assertion of wrongdoing on TransDigm’s part with respect to its pricing.”
The underlying debate is over laws and acquisition regulations that hamstring Pentagon contracting officers from demanding back-up data on parts contracts. Legislation from the Federal Acquisition Streamlining Act of 1994 to recent defense policy bills sought to encourage commercial contractors to conduct business with the military by freeing them from providing information that could be competitively sensitive and onerous to collect, according to the inspector general’s report.
The provisions discourage contracting officers from asking for the data when “determining whether a price is fair and reasonable,” it said. The inspector general “previously identified contracting officers’ limited success in negotiating fair and reasonable prices for sole-source parts dating as far back as 1998,” a spokeswoman said in a statement Tuesday.
In a sample of contracts awarded from 2015 through 2017, TransDigm “refused to provide uncertified cost and pricing data to contracting officers when requested” for 15 of 16 contracts, the audit found. “Contracting officers had limited options once TransDigm refused.” TransDigm earned $2.6 million in excess profits on the parts, the inspector general said.
The watchdog office recommended legislation “to compel companies to provide cost data when required.” The Pentagon responded by issuing a memo in mid-March to jump-start a moribund system requiring contracting officers to report and share the names of recalcitrant companies.
“We are considering potential options for legislation proposals and weighing the ‘pro’s and cons’ of how that could impact the entire industrial base, including our desire to reach more non-traditional defense contractors,” Lieutenant Colonel Michael Andrews, a Pentagon acquisition spokesman, said in an email.
TransDigm shares have climbed more than 36% this year. It drew 34% of its 2017 sales from defense, up from 24% in 2006. In its 2017 annual report, TransDigm estimated 80% of its sales revenue that year came from products for which it’s the sole supplier.
Patrick Mackin, a spokesman for the Pentagon’s Defense Logistics Agency, said the agency is managing the July 2018 contract that was questioned by the review in a way that “limits ordering” due to “the potential overpricing and scrutiny” of TransDigm.
He said the agency can’t “unilaterally change pricing outside of the contractual repricing periods” but will assess the contract at its first chance in 2021. The agency is “currently seeking alternatives to support these items where such alternatives may exist.”
Among the parts of concern in the current contract, according to the review:
TransDigm charged $803 for a retainer bearing that should have cost $32.
A part described as a “ring” for which TransDigm charged $4,835 apiece should cost $71.
*TransDigm charged $67 for a lug used in the auxiliary power unit of an F-15 jet that should have cost $3.
*TransDigm charged $8,819 apiece for a valve assembly check oil pump that should cost $369.
The inspector general’s report also outlines the history of a three-inch TransDigm coupling with a “quick disconnect” that illustrates the problem that Pentagon contracting officers confront.
While TransDigm estimated the coupling cost $287 to make, the contractor’s pricing has “contained excess profits” since the Defense Logistics Agency first purchased the part in 2007 for $1,239 apiece, the unredacted report said. The price increased to $7,325 by 2017.”
“Victory’s been defeated; it’s time we recognized that and moved on to what we actually can accomplish.
We’ve reached the end of victory’s road, and at this juncture it’s time to embrace other terms, a less-loaded lexicon, like “strategic advantage,” “relative gain,” and “sustainable marginalization.”
A few weeks back, Colombian President Juan Manuel Santos and Harvard Professor Steven Pinker triumphantly announced the peace deal between the government of Columbia and the Revolutionary Armed Forces of Columbia (FARC). While positive, this declaration rings hollow as the exception that proves the rule – a tentative treaty, however, at the end, roughly 7,000 guerrillas held a country of 50 million hostage over 50 years at a cost of some 220,000 lives. Churchill would be aghast: Never in the history of human conflict were so many so threatened by so few.
One reason this occasion merited a more somber statement: military victory is dead. And it was killed by a bunch of cheap stuff.
The term “victory” is loaded, so let’s stipulate it means unambiguous, unchallenged, and unquestioned strategic success – something more than a “win,” because, while one might “eke out a win,” no one “ekes out a victory.” Wins are represented by a mere letter (“w”); victory is a tickertape with tanks.
Which is something I’ll never see in my military career; I should explain. When a government has a political goal that cannot be obtained other than by force, the military gets involved and selects some objective designed to obtain said goal. Those military objectives can be classified broadly, as Prussian military theorist Carl von Clausewitz did, into either a limited aim (i.e. “occupy some…frontier-districts” to use “for bargaining”), or a larger aim to completely disarm the enemy, “render[ing] him politically helpless or military impotent.” Lo, we’ve arrived at the problem: War has become so inexpensive that anyone can afford the traditional military means of strategic significance – so we can never fully disarm the enemy. And a perpetually armed enemy means no more parades (particularly in Nice).
Never in the history of human conflict were so many so threatened by so few.
It’s a buyer’s market in war, and the baseline capabilities (shoot, move, and communicate) are at snake-belly prices. Tactical weaponry, like AK-47s are plentiful, rented, and shipped from battlefield to battlefield, and the most lethal weapon U.S. forces encountered at the height of the Iraq War, the improvised explosive device, could be had for as little as $265. Moving is cost-effective too in the “pickup truck era of warfare,” and reports on foreign fighters in Syria remind us that cheap, global travel makes it possible for nearly anyone on the planet to rapidly arrive in an active war zone with money to spare. Also, while the terror group Lashkar-e-Taiba shut down the megacity Mumbai in 2008 for less than what many traveling youth soccer teams spend in a season, using unprotected social media networks, communication has gotten even easier for the emerging warrior with today’s widely available unhackable phones and apps. These low and no-cost commo systems are the glue that binds single wolves into coordinated wolf-packs with guns, exponentially greater than the sum of their parts. The good news: Ukraine can crowdfund aerial surveillance against Russian incursions. The less-good news: strikes, like 9/11, cost less than three seconds of a single Super Bowl ad. With prices so low, why would anyone ever give up their fire, maneuver, and control platforms?
All of which explains why military victory has gone away. Consider the Middle East, and the recent comment by a Hezbollah leader, “This can go on for a hundred years,” and his comrade’s complementary analysis, that “as long as we are there, nobody will win.” With such a modestly priced war stock on offer, it’s no wonder Anthony Cordesman of the Center for Strategic and International Studies agrees with the insurgents, recently concluding, of the four wars currently burning across the region, the U.S. has “no prospect” of strategic victory in any. Or that Modern War Institute scholar Andrew Bacevich assesses bluntly, “If winning implies achieving stated political objectives, U.S. forces don’t win.” This is what happens when David’s slingshot is always full.
The guerrillas know what many don’t: It’s the era, stupid. This is the nature of the age, as Joshua Cooper Ramos describes, “a nightmare reality in which we must fight adaptive microthreats and ideas, both of which appear to be impossible to destroy even with the most expensive weapons.” Largely correct, one point merits minor amendment – it’s meaningless to destroy when it’s so cheap to get back in the game, a hallmark of a time in which Wolverine-like regeneration is regular.
This theme even extends to more civilized conflicts. Take the Gawker case: begrudged hedge fund giant Peter Thiel funded former wrestler Hulk Hogan’s lawsuit against the journalistic insurrectionists at Gawker Media, which forced the website’s writers to lay down their keyboards. However, as author Malcolm Gladwell has pointed out – Gawker’s leader, Nick Denton, can literally walk across the street, with a few dollars, and start right over. Another journalist opined, “Mr. Thiel’s victory was a hollow one – you might even say he lost. While he may have killed Gawker, its sensibility and influence on the rest of the news business survive.” Perhaps Thiel should have waited 50 more years, as Columbia had to, to write his “victory” op-ed? He may come to regret the essay as his own “Mission Accomplished” moment.
True with websites, so it goes with warfare. We live in the cheap war era, where the attacker has the advantage and the violent veto is always possible. Political leaders can speak and say tough stuff, promise ruthless revenge – it doesn’t matter, ultimately, because if you can’t disarm the enemy, you can’t parade the tanks.”
“The longest government shutdown in U.S. history prompted some lawmakers to optimistically suggest Congress should find a way to prevent such an event from ever happening again.
But the prospects of eliminating government shutdowns for good are unlikely, at least at this point, leaving Congress to find piecemeal solutions to alleviate the impacts ahead of a future lapse in appropriations.
The House Oversight and Reform Government Operations Subcommittee on Monday heard stories from nearly a dozen federal contractors, who described how the 35-day government shutdown impacted their businesses and employees.
Impacts on contractor employees, revenue
For Leidos, a Fortune 500 company, 893 of its employees had no or limited work to perform during the government shutdown, because they were on contracts for closed agencies, CEO Roger Krone told the subcommittee.
The company lost $14 million in revenue during those 35 days and experienced a delay in payments on outstanding invoices, which totaled about $18 million.
Leidos’ work on 22 programs came to a halt during the government shutdown, which impacted about 200 of its subcontractors, Krone said.
It also allowed those employees to advance paid leave hours up to a balance of negative 80 hours. Nearly 400 Leidos employees used up all of their vacation time and then some.
“It will take them years to build back that base of paid time off that they had prior to the shutdown,” Krone said during the subcommittee’s field hearing at George Mason University.
In addition, Leidos launched a special relief initiative to allow other employees to donate paid time off to their colleagues impacted by the government shutdown. More than 50 employees said they were in state of extreme financial hardship and needed additional assistance. These employees received a grant of $2,500.
“If the shutdown were to have continued any longer, we anticipated receiving another 100 requests each week for assistance,” Krone said.
Leidos also set up specific team to redeploy impacted employees to open positions on contracts for agencies who weren’t impacted by the government shutdown.
But some contractors couldn’t redeploy their employees to work on other contracts that weren’t impacted by the shutdown, because that work required a specific security clearance their employees didn’t have, or it would have simply taken too long to receive those credentials.
Citizant, a small business that employs 180 professionals and supports the IRS, DHS and the departments of Defense and Justice, couldn’t redeploy its 35 employees who were impacted by the government shutdown to other work.
The company did continue to pay its employees during the shutdown, but that decision came at a cost.
“When your only customer doesn’t pay you for nearly four months and you’ve reached your company’s borrowing capacity, you face the dire prospect as a business owner to file for bankruptcy or sell off parts of your business for pennies on the dollar in order to pay your employees,” Alba Alemán, Citizant’s CEO, said. “We were within days of having to make that decision.”
Delayed invoices, slow to restart work
Outstanding invoices piled up until March, which put Citizant $4 million in debt. Alemán said her company also maxed out its borrowing capacity and put off paying its own vendors until April.
Other companies have also experienced a delay in receiving payment for outstanding invoices after the government shutdown, said David Berteau, president and CEO of the Professional Services Council.
“As of two weeks ago, we still had member companies who had not had invoices paid from work done before the shutdown. Those invoices were still being reviewed and processed. That goes back to invoices filed before Dec. 21 for work done and paid for before Dec. 21. That’s not common, but it’s not out of the question.”
Confusion reigned large during the government shutdown for many of the contractors.
Advanced Concepts and Technology (ACT 1) had two large contracts impacted by the shutdown at the Department of Homeland Security.
One contract was up for year-long option during lapse. The contract expired during the government shutdown, and the department didn’t have a contracting officer available to execute the option.
“They weren’t able to execute our option, so we basically moved off contract and couldn’t show up in the offices,” said Michael Niggel, the company’s CEO. “Our customer was frustrated with us because we weren’t there and other contractors were. They had funded contracts, but we did not.”
Now, ACT 1 has heard two different legal opinions from DHS about what should happen next.
Rep. Gerry Connolly (D-Va.), the subcommittee’s chairman, suggested the contractors, led by PSC, develop a list of simple solutions that could resolve these challenges ahead of future shutdowns.
“Certainly one of them is to have some kind of provision in law that says during a shutdown, the expiration is on ice, so you don’t lose the contract simply because the contracting officers aren’t there,” Connolly said.
The contractors also suggested Congress consider a specific provision that allows work on a specific contract to automatically restart once the lapse in appropriations ends — as well as other measures to provide more clarity on stop work orders altogether.
“The head of procurement at DHS specifically sent a memo to all contracting officers saying unless you issue or your contractor is issued a stop work order, and as long as you don’t need guidance from the government to keep doing your job, leave it alone, walk away and let them keep doing their jobs,” Alemán said. “The problem is they sent the notice the day after the shutdown. They were no longer able to read their emails, so they didn’t know that. They shut us down temporarily. We got a copy of the memo because one customer that was working sent it to us. We sent it to [DHS] and they logged in and said, ‘Yup, keep working. You’re not on a stop work order.’”
More clarity on unemployment benefits
Just as many federal employees weren’t clear if they would be eligible to receive unemployment benefits during the government shutdown, federal contractors had similar questions.
“Most of our members were too confused,” said Ed Grabowski, a local president for the International Association of Machinists and Aerospace Workers union. “Were they eligible for it because they were furloughed and they didn’t actually receive a lay off notice? So they weren’t astute enough to [know] how to apply. If I do take personal leave time, am I still entitled to collect unemployment compensation? … We had a problem with communication.”
Members of the International Association of Machinists and Aerospace Workers are helicopter pilots, lab technicians and crane operators for agencies like NASA.
“This confusion at least, it seems like we could help eliminate that,” said D.C. Del. Eleanor Holmes Norton. She, along with Reps. Don Beyer (D-Va.) and Jennifer Wexton (D-Va.) said there were opportunities for Congress to provide more clarity ahead of future lapses.
Contractors and other businessmen who were affected by the shutdown said the lapse had an impact on their staff and their ability to recruit new talent.
Wesley Ford, president of TKI Coffee, said he lost a significant amount of revenue during the government shutdown. His store is located near several agencies who were closed in January, and explicitly decided to lay off 40 percent of his staff during the shutdown so they could receive unemployment benefits.
At least 35 security officers who worked for one of the shuttered Smithsonian museums during the government shutdown quit, said Jaime Contreras, vice president of a Service Employees International Union (SEIU) local in the national capital region.
And Alemán said several of the senior-level DHS employees that Citizant worked with on their contracts left during the government shutdown.
Some of PSC’s member companies told Berteau their recruits had canceled interviews during the government shutdown.
“The Defense Department is just starting its second year of full-scale financial audits, and it’s likely to take many more before those efforts yield a clean opinion.
In the first year of the full-scope examination, auditors issued more than 170 separate findings and recommendations detailing the military services shortcomings in tracking their small-item inventory and real estate. “
“But the process is already having at least one beneficial effect: It’s pushed the military services to account for tens of millions of dollars in government property they’d lost track of.
David Norquist, DoD’s CFO and comptroller, said progress along those lines has already delivered concrete proof for why the audit is not merely a paperwork drill.
“We discovered there are certain facilities where what they thought they had in inventory did not match what they had in inventory. And if your responsibility is spare parts for airplanes, the accuracy of that inventory matters,” he told the Senate Armed Services Committee last week.
One example was how, at Utah’s Hill Air Force Base, a stockpile of missile motors was erroneously listed as unserviceable even though they were in perfectly good condition. Putting them back into circulation instead of ordering new ones saved the Air Force $53 million.
“In other places, if you go to Osan and Kadena [air bases in Japan], they had 14,000 munitions worth $2.2 billion, and 100 percent were accounted for — not a single exception,” Norquist said. “What we’ve learned is there are some places that are doing this quite well, and there are others where we need to help them fix their processes, but the commanders in the field recognize the direct connection to mission and readiness. They saw the tangible value, and I think as we move forward, the accuracy of the data and adopting more businesslike practices will be tremendously helpful.”
Facilities ‘no one knew existed’
Instances of bad or missing data about entire warehouses worth of parts came up more than once during the course of the 2019 audit.
Thomas Modly, the undersecretary of the Navy, said the Navy found something similar when its auditors began examining a facility in San Diego.
“When we went out and actually started counting inventory and understanding where our stuff was, they found a warehouse that no one knew existed, and it had $26 million worth of parts for the E-2 and the F-18,” he said. “It was not categorized. It did not sit on any inventory system that we had in the whole Department of the Navy. Once that was identified, we were able to requisition $19 million worth of parts to aircraft that were waiting for them and were down because we didn’t even know we had those parts. This is a serious problem for us that we really have to get after, because at the end of the day, it impacts our ability to perform the mission, and our costs.”
The DoD Inspector General reported similar issues in its summary of the 2019 audit findings. More than 100 Blackhawk helicopter blades that were listed as available for use, but that were actually damaged. Fuel injectors stored in warehouses with no documentation to show which military service owned them. Entire facilities that had been demolished years ago, but are still listed as active on the military’s property books.
The IG reported 20 overall material weaknesses after the first audit, and then refined the list down to six that auditors thought were most concerning. Two of the six had to do with property — one encompassed spare parts and other inventory, while the other dealt with bigger-ticket items like real estate.
“We’ve gone out and said, ‘Give us a list of a certain asset and how many you have and where they’re located.’ And when we go, we either find that they have more than they thought, or the ones on their lists don’t exist,” said Carmen Malone, the deputy assistant inspector general for audit. “If you have something in your inventory records that actually can’t be used, you’re not going to order something, because you think you already have it. From an inventory standpoint, that is a big deal.”
Malone said one of the reasons the IG considers the property issue so serious is that it has a direct bearing on military readiness.
“It’s not just from a financial statement standpoint,” she said. “We are out talking to the everyday operating people and making sure that they understand that what they do impacts not just the financial statements. This information will be used as a central location for decision makers across the department from a readiness and logistics standpoint as well. If the information is accurate for financial statements, it’s going to be accurate for the decision makers, which ultimately affects the operations and readiness of the department.”
At last week’s hearing, Norquist declined to predict when the department will finally earn a clean opinion on its full financial statement, but he said he expected that either the Army or the Marine Corps would pass an audit of a small portion of their individual statements — namely, their working capital funds — within the “next couple years.”
But Modly said his department has major, systemic challenges it still needs to solve with its accounting systems before audit passage is a reasonable probability — at least on an ongoing, repeatable basis.
“We have nine current general ledger systems. They’re not connected, and they create all kinds of disparities in our ability to truly understand our financial information,” he said. “We have business systems that are even more complicated that require interfaces that cause breaks in data security. Because of all those problems, we’re doing a lot of estimating, a lot of hand-jamming of information that most modern industrial corporations never have to do. Most modern industrial corporations can push a button and generate a financial report. We are not even close to that, and we have to get better.”
“There really still appears to be this imbalance in the total number of full-time staff and the number of cases,” Nabatchi said, one of the authors of a report published last year on trends in FOIA administration.
The study analyzes aggregate FOIA.gov data from 102 agencies between 2008 and 2016.
Bradley White, a FOIA officer for DHS’s Office for Civil Rights and Civil Liberties (CRCL), said that staff-to-request ratio seemed lower than what he’s experienced.
White previously worked for seven years at the Immigration and Customs Enforcement’s FOIA office. During that time, he said each agency analyst had a weekly quota of processing 35-to-50 FOIA requests a week.
“That ratio probably fluctuates tremendously depending on where you are,” Nabatchi said.
Khaldoun AbouAssi, an assistant professor of public administration and policy at American University, and the study’s second author, noted that even the most well-staffed agencies struggle with FOIA backlogs.
“We’re seeing that the more staff or the more employees, the higher the number of the FOIA backlog,” AbouAssi said, adding the results of the study would require future investigation.
Over time, the cost of processing FOIA requests has also increased. In 2016, agencies spent nearly half a billion dollars processing FOIA requests. However, Nabatchi added that collected fees for FOIA covered less than 1 percent of total costs.
Between 2008 and 2016, six agencies consistently received more requests than any other agency:
Department of Homeland Security
Health and Human Services
Department of Veterans Affairs
Social Security Administration
Agencies that receive the most FOIA requests, Nabatchi noted, fall into one of two buckets: agencies that process individual benefits for claims, or agencies with a law enforcement or national security mission.
Five of those agencies — VA, HHS, DOJ, DHS and DoD — and the Agriculture Department employ more than 65 percent of governmentwide FOIA staff, Nabatchi said.
However, Emily Creighton, the deputy legal director at the American Immigration Council, and a member of the governmentwide FOIA Advisory Committee, said a “large number” of FOIA requests at DHS come from people submitting individual files requests to U.S. Customs and Immigration Services for their immigration records.
“That really just has to do with just how the immigration system works, and that’s how they access their data. That is the only way that they can access their records,” Creighton said.
Nabatchi said she and AbouAssi debated whether to break out the FOIA data on agency components, but ultimately chose not to.
“Do we look at the agency as a whole … or do we start looking at the units within the agencies, because there’s going to be variation within those units as well,” she said.
Empowering an ‘overlooked’ FOIA workforce
Alina Semo, the director of the Office of Government Information Services at NARA, said in an interview last week that professionals are often “overlooked” and not given the credit as they deserve fulfilling a difficult but important job.
“They’ve got to go knocking on doors at their agencies and ask people to open up their file cabinets and give them documents,” Semo said. “Most folks at agencies are not happy to see them: ‘Please leave me alone. I’m trying to fulfill the mission of the agency. I don’t have time to answer a FOIA request.’”
In 2012, the Office of Personnel Management introduced a government information job series aimed at giving FOIA professionals more of a career path. Since then, Semo said she’s generally seen a more positive attitude among FOIA professionals, but added that the future of the workforce remains a concern.
“I worry about the fact that we’re not going to have another wave of FOIA professionals that will come behind the ones that are going to retire in 10, 15, 20 years,” she said.
Earlier this month, OGIS, in its annual report to Congress, recommended that lawmakers pass legislation that would give agencies “sufficient resources” to respond to FOIA requests and comply with Section 508 of the Rehabilitation Act
The FOIA Improvement Act, which Congress passed in 2016, requires agencies to post documents online after they’ve been requested three or more times. But one of the major bottlenecks of that law is the time it takes to code released documents to make them accessible to online users with physical disabilities.
In many cases, FOIA officials end up doing the Section 508 coding, but that takes time away from processing more FOIA requests.
“What we hear from agencies is that the IT shops don’t necessarily want to help because they have their own to-do lists that don’t include making documents Section 508 accessible, and usually it falls back to the FOIA professionals to do it,” Semo said.
As part of its request to Congress, OGIS has suggested reaching out to the General Services Administration’s 18F agency to streamline and simplify the process of making documents 508 compliant.
Likewise, OGIS said the Department of Health and Human Services’ National Institute on Disability, Independent Living and Rehabilitation Research could help automate Section 508 processing.
A third, but less likely scenario, Semo said, would have agencies proactively post an “index” of records released under FOIA.
“Someone with disabilities could look at the index, which itself would be 508 compliant, and then contact the agency and say, ‘I would like to see documents five, seven and nine,” Semo explained. “At that point, the agency would then go ahead and make the documents five, seven and nine 508 compliant.”
“DoD spending accounted for $61.2 billion of that spending spree, awarding “use-it-or-lose-it” contracts and buying, among other things, $4.6 million worth of crab and lobster and a Wexford leather club chair costing more than $9,300.
The 32-page Open the Books report, https://www.openthebooks.com/assets/1/7/UseItOrLoseIt_Final1.PDF published this month, showed the federal government as a whole spent an astounding $97 billion in September 2018 as the fiscal year was drawing to a close — up 16 percent from the previous fiscal year and 39 percent from fiscal 2015. “
“Focusing on the lobster, though, misses the point on how the Pentagon’s spending habits actually do troops a disservice, according to Mandy Smithberger, director of the Center for Defense Information at the Project on Government Oversight.
“The lobster tail example captures one’s imagination, but that’s not where congressional oversight needs to focus,” Smithberger told Military.com. “As you see spending go up, you see the amount of this use-it-or-lose-it spending going up as well, and that’s really not to the good.”
She said the billions of expenditures demonstrated DoD efforts to “use money to paper over management problems.”
For the Pentagon, the biggest year-end expenditure was professional services and support, accounting for $9.6 billion of spending in September 2018. Then came fixed-wing aircraft, a buy of $8.6 billion. Other top spending items include IT and telecom hardware services and support, $4.7 billion; combat ships and landing vessels, $3.9 billion; and guided missiles, nearly $2 billion.
More than the individual items and services purchased, the biggest problem may be the way the spending happens — and the perverse incentives not to end up with leftover money at the end of the year, because it might negatively impact efforts to obtain funds the following year.
“Congress is a lot of the problem,” Smithberger said. “Appropriators look and see whatever is not spent, they take and use for their pet project.”
As the Pentagon budget request continues to balloon year after year, Smithberger said she’d like to see incentives to save money and a system that would keep planners from worrying about a loss of resources the following year.
“If the department showed that it was able to save tens of billions of dollars, they would have a more credible case for the topline,” she said.
There’s plenty of evidence, Smithberger said, that money alone doesn’t solve or prevent institutional problems. For example, she said, the Navy was making big investments in shipbuilding when two guided-missile destroyers collided with commercial ships in separate deadly incidents within months of each other in 2017. While investigations did cite scarcity of resources, training was found to be a major shortfall contributing to the disasters.
When it comes to defense spending, “it’s a lot of hollow rhetoric and it’s really costly when we decide to only express our support through appropriations and not through real decision-making and responsibility,” she said.”
“Chock-full of football analogies, stock photos and colorful block letters, the 60-plus page document (embedded below) nevertheless confronts serious issues head-on, including a broken budget process and a $22 trillion national debt.”
“A major goal of the report is to draw bipartisan support for addressing the massive national debt and continuous budget deficits, issues that “should be chilling everyone,” Lankford told reporters on Tuesday.
“The problem has become so large people say, ‘It’s unsolvable, let’s move on,’” Lankford said. “We can’t do that.”
It’s a problem not many people are talking about because the hard part is proposing solutions, Lankford said, which is “where the conversation seems to drop off.”
That’s where “Federal Fumbles” is meant to come in. It outlines problems in a variety of areas, from immigration and federal workforce to infrastructure and veterans affairs, and concludes with possible solutions.
“My goal for this book is to make it a resource for taxpayers and the entire federal government,” the report opens. “Congress, federal agencies and the White House should all take a look at the content covered in this book and the solutions I present.”
Previous versions of Federal Fumbles, a continuation of former Oklahoma Rep. Tom Coburn’s government waste report, have called out outrageous ways in which tax dollars are spent. But this version focuses on deeper issues in government process and policy.
For example, the report proposes that Congress be mandated to regularly vote on budgetary deficit reduction every year or two in order to confront the debt problem.
It mentions Lankford’s proposed Prevent Government Shutdowns Act that would keep the government open and funded at the previous year’s level if Congress fails complete its work by the end of the fiscal year.
The proposal adds an incentive for members of Congress to complete the budgetary process: if they don’t finish, they can’t leave Washington D.C. or adjourn for recess. “It is simple: stay until the work is done,” the report says.
This would prevent scenarios like the recent 35-day government shutdown, a major “fumble” that resulted in an $18 billion hit to the U.S. economy as well as fear, confusion and financial loss for American families, according to the report.
Lankford told reporters that Federal Fumbles “absolutely” includes bipartisan measures, including the proposal to prevent shutdowns, increased transparency in how tax dollars are spent, election security and improving the way federal grant money is spent.
Regarding border issues, Lankford suggests increasing the number of immigration judges and staff to deal with the backlog, making people with expired visas leave the country, encouraging private groups to sponsor and welcome refugees and vocally supporting the work of U.S. Immigration and Customs Enforcement.
The report criticizes the Senate’s arcane procedures, which Lankford called “the definition of waste and inefficiency.” It proposes speeding up the nomination process for executive positions and making it easier to open debate on a bill.
Other proposals include increasing rural connectivity and broadband, fixing congressional ethanol mandates, speeding up federal hiring, administrative reorganization and regulatory reform.
The end of the report gives a nod to “touchdowns,” or areas the government has achieved victories. These include drug pricing options, less expensive health insurance and opioid addiction treatment.”