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OMB Update Mark Reger, Deputy Controller Gilbert Tran, Policy Analyst March 11, 2015.

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Presentation on theme: "OMB Update Mark Reger, Deputy Controller Gilbert Tran, Policy Analyst March 11, 2015."— Presentation transcript:

1 OMB Update Mark Reger, Deputy Controller Gilbert Tran, Policy Analyst March 11, 2015

2 2 Topics Improper Payments Transparency – Data Act Implementation Uniform Guidance for Grants

3 3 Improper Payments - Brief History November 2002 – Improper Payments Information Act (IPIA) −Created basic framework for identifying and reporting improper payments November 2009 – Executive Order −Improved agency accountability −Increased transparency July 2010 – Improper Payments Elimination and Recovery Act (IPERA) −Put into law specific thresholds for identifying high-risk programs −Strengthened corrective action plans −Expanded payment recapture audits −Established annual OIG compliance reviews January 2013 – Improper Payments Elimination & Recovery Improvement Act (IPERIA) −Codified EO requirements −Improved agency estimation and recovery of improper payments −Reinforced and accelerated the Administration’s “Do Not Pay” efforts

4 4 A-123 Appendix C Update Vision: transform improper payment compliance framework to create a more unified, comprehensive, and less burdensome set of requirements for agencies and OIGs IPERIA required OMB to issue new guidance—we approached it as an opportunity to overhaul Appendix C of OMB Circular A-123 Process: as we drafted the new Appendix C, we had to consider the following: –The three statutes and the Executive Order –Previous Appendix C version (M-11-16) –Input from agencies, OIGs, GAO, and OMB

5 5 New Appendix C Highlights The updated guidance reconciles IPERIA requirements that are identical to requirements from EO Consolidates and streamlines reporting requirements for agencies and OIGs –Agencies can incorporate most of their reporting into AFR or PAR –OIGs for agencies with high-priority programs are no longer required to issue separate reports under EO and IPERA—one report will suffice Provides a more detailed categorization of improper payments Adds an internal control framework for addressing improper payments Provides guidance to agencies—as required by IPERIA—to strengthen the statistical validity of estimates and include payments to Federal employees in the definition of improper payments, among other things

6 6 New Improper Payment Categories Previously only three categories; not very useful New guidance establishes new categories for reporting improper payments Provides more granularity on estimates, leading to: –More effective corrective actions at the program level –More focused strategies for reducing improper payments at the government-wide level –Better communication about the nature of improper payments

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8 8 We are conducting an analysis to identify program-specific corrective actions with the highest return-on-investment or potential for substantially reducing improper payments Questions we are interested in: –Which current corrective actions are the most effective in reducing improper payments in your programs? –Could you list one or two things that your programs are not already doing (but could realistically do) that would lead to a significant decrease in improper payments? –What, if any, are the barriers preventing your agency from taking these actions, and what would it take to overcome those barriers? –If you implemented these actions, by how much could the improper payment rate go down for your programs? –How has your agency advanced data analytics and improved technology to prevent and reduce improper payments ? Corrective Actions

9 9 DATA Act Implementation Update

10 10 DATA Act Goals Expand the Federal Funding Accountability and Transparency Act of 2006 by disclosing direct federal agency expenditures and linking federal contract, loan, and grant spending information to programs of federal agencies to enable taxpayers and policy makers to track federal spending more effectively. Provide consistent, reliable, and searchable government-wide spending data that is displayed accurately for taxpayers and policy makers on the USASpending.gov website. Analyze federal spending data to proactively prevent waste, fraud, abuse, and improper payments. Simplify reporting for entities receiving federal funds by streamlining reporting requirements and reducing compliance costs while improving transparency. Improve the quality of data submitted to USASpending.gov by holding federal agencies accountable for the completeness and accuracy of the data submitted.

11 11 DATA Act in Context of Spending Life Cycle Appropriation Apportionment Allotment (Allocation) Commitment Obligation Payment 360 Spending Life Cycle DATA Act FFATA (USAspending.gov) Award 11 Receipts/ Financing

12 12 Lead Treasury (Data Transparency PMO) OMB Design and Implement Treasury Data Exchange Standards Treasury Blueprint/roadmap between data elements OMB Data Definition Standards OMB Pilot to Reduce Admin Burden Treasury Data Analytics Support Senior Accountable Officials from each of the 24 CFO Act agencies Consult Industry Non-Federal stakeholders Federal Lines of Business Executive Steering Committee – OMB and Treasury Governance and Implementation Structure Inter-Agency Advisory Committee – OMB, Treasury, and Representatives from: CFOC, BOAC, ACE, COFAR, CAOC, CIOC, PIC, OSTP, GSA, CIGIE Inter-Agency Advisory Committee – OMB, Treasury, and Representatives from: CFOC, BOAC, ACE, COFAR, CAOC, CIOC, PIC, OSTP, GSA, CIGIE 12

13 13 DATA Act Requirements FFATA Sec. 3 “Full disclosure of federal funds”

14 14 DATA Act Implementation Approach Data-centric Avoid massive system changes, rather focus on managing data Incremental Release data as it becomes available Reuse Maximize and leverage use of existing processes and investments Collaborative Feedback drives improvements Iterative/Agile Conduct many small scale pilots

15 15 DATA Act Milestones DATA Act Enacted (May) Issue guidance to agencies on data standards and conduct pilot (May) Establish pilot to standardize financial reporting (May) Agencies report information in accordance with the standards. Information published on public website (May) Report on results of reporting pilot (August) First IG report (Nov.) Agencies implement June 2013 OMB memo on data quality (Q1) USAspending transitioned to Treasury (Feb.) Launch improved USAspending (March) USAspending short-term improvements DATA Act Requirements OMB Guidance to agencies to reduce reporting burden (August) 2018

16 16 Federal Spending Transparency at the State Level States have been making great strides and launching robust transparency initiatives How do you use this data to manage? How can we complement and support your work on transparency with our efforts? We welcome continued feedback and partnership. Check out our GitHub page:

17 ♫ Are You Ready for This ? The New Uniform Guidance 2 CFR 200

18 18 Guidance Reform History Nov. 2009: Executive Order: Reduce Improper Payments Feb 2011: Presidential Memo: Reduce Administrative Burden Feb 2012: Advance Notice of Proposed Guidance (public comments) Feb 2013: Notice of Proposed Guidance (public comments) Dec 2013: Final Uniform Guidance † April 2013

19 19 December 2013: Uniform Guidance Published January-April 2014: Training Webcasts, Publish 2014 Single Audit Compliance Supplement June 2014: Agencies Submit Draft Rules to OMB, Continued Outreach on Implementation December 2014: Final Guidance Effective, Baseline Metrics Collected, Case Studies of Best Practices Published Guidance Reform History Fall 2014: Metrics, Additional FAQs and Webcast

20 20 Eliminating Duplicative and Conflicting Guidance Awards Received A-102 & A-89 A-87 A-133 &A-50 Subawards to universities A-110 A-21 Subawards to nonprofits A-110 A-122 INSERT YOUR STATE OR AGENCY HERE Now: All OMB guidance streamlined in 2 CFR 200. Then:

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23 23 2 CFR 200 -Basic Layout 6 Subparts A through F – Subpart A, 200.XX – Acronyms & Definitions – Subpart B, 200.1XX – General – Subpart C, 200.2XX – Pre Award - Federal – Subpart D, 200.3XX – Post Award – Recipients – Subpart E, 200.4XX – Cost Principles – Subpart F, 200.5XX – Audit 11 Appendices - I through XI

24 24 Top Ten Impact Changes through 99 Standard Definitions , Review of risk of applicants – Must have framework for evaluating risks – Should consider financial stability, performance history, audit reports , Supplies (computing devices) , Procurement Standards , Prior Written Approval (22 items)

25 25 Top Ten Impact Changes , Prior Written Approval (22 items) , Direct Costs , Indirect Costs – Must accept approved negotiated rates (some exceptions) – 10% of MTDC de minimis IDC – One time four-year extension of current approved rate (final and pre-determined rates only) , Compensation – Personal Services 200.5XX, Single Audits – Higher Threshold ( ) – Better Transparency ( ) – More Focus on Risk ( )

26 26 “Should” and “Must” Shall is Out – Yes, Shout it Out But Should is In May will be back So will April and June Orange is the new Black Must is the new Shall

27 27 1. Micro- Purchases 2. Small Purchases 3. Sealed Bids 4. Competitive Proposals 5. Sole Source General Standards: A. Documented Policies B. Necessary C. Full & Open Competition D. Conflict of Interest E. Documentation i. Cost & Price Analysis ii. Vendor Selection Procurement “Claw” (Sections )

28 28 1. Micro Purchases 2. Small Purchases 3. Sealed Bids 4. Competitive Proposals 5. Sole Source $ 3K No quotations Equitable distributions Up to $150K Rate quotations No cost or price --analysis > $150K Construction projects Price is a major ---factor > $150K Fixed price or cost ---reimbursement RFP with evaluation methods Unique Public emergency Authorized by agency (or PTE) No competition Procurement “Claw” (Section )

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30 30 Agency Implementation Adopted by 28 Federal awarding agencies on December 19, 2014 Agency implementation regulations available in 2 CFR Effective for awards issued on or after December 26, 2014

31 31 Interim Final Rule Comments Joint interim final rule comments were due February 17, 2015 OMB is in the process of reviewing comments in coordination with Federal awarding agencies

32 32 Metrics OMB Memorandum M requests non- Federal stakeholder feedback on the overall impact on burden and waste, fraud, and abuse The Council on Financial Assistance Reform (COFAR) and OMB is currently accepting feedback on the COFAR website

33 33 Resources The COFAR website is available at: https://cfo.gov/cofar/ https://cfo.gov/cofar/ Includes: – FAQs – Webcasts – Crosswalk to agency exceptions and additions


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