1. OMB Update on Charge Card Management Kim Farington, CPA Susan Truslow U.S. Office of Management and Budget 12 th Annual Smart Pay Training Conference August 11-13, 2010

2. Agenda Office of Federal Procurement Policy Office of Federal Financial Management TIPRA Charge Card Working Group 2

3. Organization Hierarchy Office of Federal Financial Management (OFFM) Executive Office of the President (EOP) Office of Federal Procurement Policy (OFPP) Office of Management and Budget (OMB) 3

4. OFPP--Scope $550 billion obligated in FY 2009 8+ million contract actions 26+ million purchase card actions 112 Departments and agencies 3,300 contracting offices 30,000 contracting officers 300,000 purchase card holders 4

5. OFPP Roles Lead the Chief Acquisition Officers Council Direct the Federal Acquisition Institute Chair the Federal Acquisition Regulatory Council Chair the Cost Accounting Standards Board Direct activities supporting the Federal Procurement Data System and the IAE 5

6. Presidential Memorandum Acquisition Savings Plans –Agencies must save 3.5% of baseline contract spending in FY 2010 and a further 3.5% in FY 2011 High Risk Contracting –Agencies must reduce by 10% the dollars obligated through non-competitive, one-bid, cost- reimbursement, and T&M/LH contracts Multi-Sector Workforce Pilots –Agencies must analyze their reliance on contractors Acquisition Workforce –Civilian agencies must increase the capability and capacity of their acquisition workforce 6

7. Other OFPP Goals Use Strategic Sourcing Leverage the buying power of the Federal government FSSI Office Supplies solution www.gsa.gov/fssiofficesupplies 15 BPA Holders POS Feature – use your GSA SmartPay card and automatically get the negotiated BPA price –Save $4M/annually POC: Michel Kareis michel.kareis@gsa.gov Training POC: judy.poskanzer@gsa.gov 7

8. OFFM Scope The Office of Federal Financial Management (OFFM) Improves financial management and systems to reduce improper payments Improves grants management “Right-size” Federal real property Coordinates the activities of the Chief Financial Officers and Senior Real Property Officers 8

9. Tax Increase Prevention and Reconciliation Act (TIPRA) Requires a “tax” withholding at a rate of 3% on all government payments for products and services over $10,000 made by the federal government, state governments, and local governments  i.e. - Invoice for $100, government only pays $97  The 3% withheld is allocated to the company’s or individual’s tax liability Impacts payments under government contracts as well as Medicare payments, Farm payments, and grants to for-profit companies Applies to all payments starting in 2012 (change made from 2011 to 2012 in P. L. 111-5, the Economic Stimulus bill) 9

10. TIPRA (cont’d) Reasons for TIPRA: In 2001, IRS estimated tax gap to be $345 billion GAO report: Abuse of tax system by contractors ◦ GSA contractors owe $1.4 billion in taxes ◦ DOD and civilian contractors owe $6 billion in taxes Expected to increase revenue by $7 billion between 2011- 2015 (revenue offset provision) 10

11. TIPRA (cont’d) Three working groups 1. Business Process Changes 2. Systems Alternatives 3. Charge Cards 11

12. TIPRA Charge Card Working Group Role: Propose policy and procedures to address TIPRA requirements Led by staff from GSA’s Office of Charge Card Management Plans for moving forward: Meet weekly to resolve issues raised related to charge cards FAR Cases may be required to address some payment issues Make recommendations to Steering Committee and Treasury Communication of efforts on OMB MAX Portal max.omb.gov “Financial Management” link => “TIPRA” link 12

13. Questions? Kim Farington kfarington@omb.eop.gov Susan M.M. Truslow struslow@omb.eop.gov Blank