FEDERAL AGENCIES:

Senators set their sights on program duplication

Congress helped create the problem of duplicate federal programs, but some senators took aim at the Obama administration yesterday for moving too slowly to correct overlapping services that waste billions of dollars.

The Government Accountability Office released a report in March identifying 34 areas in which federal agencies have overlapping objectives and services, as well as 47 additional cost-saving opportunities. It has become one of the agency's most-read reports as Republicans continue to push for more government cuts amid the country's recession.

Yesterday's hearing of the Senate Homeland Security and Governmental Affairs Committee focused on data center consolidation and other information technology fixes. But at times it became a referendum on the administration's commitment to cutting government spending.

Sen. John McCain (R-Ariz.) lamented the lack of "specific actions" to eliminate programs, sparring with Federal Procurement Administrator Daniel Gordon over the administration's progress.

"We see these [reports] and it makes headlines and eyebrows are raised ... and yet there's no change. Nothing happens," he said. "It's terribly frustrating."

Sen. Ron Johnson (R-Wis.) briefly turned the conversation to the debt ceiling, arguing that the administration should have a fallback plan if Congress does not raise the limit. He suggested that the committee issue letters to agencies asking them to prioritize essential services; in the long term, he said, GAO should also help Congress prioritize programs governmentwide.

"I'm concerned that we're trying to fear monger here," Johnson said. "If we plan for this, it wouldn't be pleasant, but it wouldn't be the crisis" officials have made it out to be.

GAO's report details the sometimes-staggering number of duplicate programs across federal agencies. Eighty federal programs offer transportation assistance to the disabled, for example, while more than 82 focus on teacher quality.

Other programs have become unnecessary. A recent tax credit hands fuel blenders billions of dollars for using ethanol, but a renewable fuel standard will soon render the credit unnecessary to support domestic production. If left unchanged, the tax credit could cost the Treasury $6.75 billion annually by 2015.

Many of the duplicate services are a result of Congress' actions over a period of decades. A lawmaker decides to create a program, Congress passes an authorizing bill and no one bothers to check whether such a program already exists.

"There are no bad intentions here," said Sen. Susan Collins (R-Maine), the committee's ranking member. "Just the opposite -- it's the proliferation of good intentions that has created the problem."

Comptroller General Gene Dodaro said that more than one-third of the 81 cost-saving areas identified in the report require congressional action. But it is unclear which programs are most effective, he said, because many have no performance measures.

"I think that this is a perfect opportunity for Congress and the administration to work together to rationalize these programs," Dodaro said. "There's a lot of associated administrative costs."

The Office of Management and Budget is already working to consolidate data centers, which have skyrocketed from about 432 in 1998 to more than 2,000 today. Many of the facilities are underutilized, using an average of 27 percent of their capacity. The White House plans to shut down 137 of the centers by the end of the year.

Federal Chief Information Officer Vivek Kundra said the administration's effort will save $5 billion over the next five years. Further savings will come from cloud computing, where agencies' technology needs will be centralized and provided on demand.

But senators were skeptical about individual agencies' progress. Sen. Mark Pryor (D-Ark.) said many have only said they are "considering" GAO's findings.

Committee Chairman Joe Lieberman (I-Conn.) said the committee plans to send letters to agencies and OMB asking for specifics on how they will eliminate duplicate programs. Part of the problem, he said, is that agencies do not have the data to identify their wasteful efforts.

"Many federal agencies don't seem to really know what resources they have available to them," he said. "Because of that information gap, a program or agency is more likely to supplicate existing resources."

Agencies also need more data to better utilize interagency contracts, according to GAO. Though $54 billion was obligated to interagency contracts in fiscal 2009, GAO reported that the government "does not have a clear, comprehensive view of whether these contracts are being utilized in an efficient and effective manner."

Gordon said OMB will soon issue guidance requiring agencies to justify new contracts and consider whether they are duplicating existing ones.

Agencies also may be wasting money on noncompetitive contracts; Dodaro said GAO found that up to 35 percent of government contracts were noncompetitive, potentially causing agencies to spend more than necessary.

But Gordon refused to answer questions on two draft executive orders that would enact new contract requirements -- and would, according to Collins, limit competition. One would give extra points to businesses that offer certain wages and another would require bidders for a federal contract to report political contributions from the previous two years.

"Businesses are going to decide that the system is stacked against them and not bother to submit a bid," Collins said. "I hope that you will take a hard look at both of these executive orders."

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