    [House Hearing, 112 Congress]
    [From the U.S. Government Publishing Office]

      TRANSPARENCY THROUGH TECHNOLOGY: EVALUATING FEDERAL OPEN-GOVERNMENT
                                    EFFORTS

    =======================================================================

                                    HEARING

                                   before the

                    SUBCOMMITTEE ON TECHNOLOGY, INFORMATION
                    POLICY, INTERGOVERNMENTAL RELATIONS AND
                               PROCUREMENT REFORM

                                     of the

                             COMMITTEE ON OVERSIGHT
                             AND GOVERNMENT REFORM

                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   __________

                                 MARCH 11, 2011

                                   __________

                               Serial No. 112-17

                                   __________

    Printed for the use of the Committee on Oversight and Government Reform

             Available via the World Wide Web: http://www.fdsys.gov
                          http://www.house.gov/reform

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                  COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                     DARRELL E. ISSA, California, Chairman
    DAN BURTON, Indiana                  ELIJAH E. CUMMINGS, Maryland,
    JOHN L. MICA, Florida                    Ranking Minority Member
    TODD RUSSELL PLATTS, Pennsylvania    EDOLPHUS TOWNS, New York
    MICHAEL R. TURNER, Ohio              CAROLYN B. MALONEY, New York
    PATRICK T. McHENRY, North Carolina   ELEANOR HOLMES NORTON, District of
    JIM JORDAN, Ohio                         Columbia
    JASON CHAFFETZ, Utah                 DENNIS J. KUCINICH, Ohio
    CONNIE MACK, Florida                 JOHN F. TIERNEY, Massachusetts
    TIM WALBERG, Michigan                WM. LACY CLAY, Missouri
    JAMES LANKFORD, Oklahoma             STEPHEN F. LYNCH, Massachusetts
    JUSTIN AMASH, Michigan               JIM COOPER, Tennessee
    ANN MARIE BUERKLE, New York          GERALD E. CONNOLLY, Virginia
    PAUL A. GOSAR, Arizona               MIKE QUIGLEY, Illinois
    RAUL R. LABRADOR, Idaho              DANNY K. DAVIS, Illinois
    PATRICK MEEHAN, Pennsylvania         BRUCE L. BRALEY, Iowa
    SCOTT DesJARLAIS, Tennessee          PETER WELCH, Vermont
    JOE WALSH, Illinois                  JOHN A. YARMUTH, Kentucky
    TREY GOWDY, South Carolina           CHRISTOPHER S. MURPHY, Connecticut
    DENNIS A. ROSS, Florida              JACKIE SPEIER, California
    FRANK C. GUINTA, New Hampshire
    BLAKE FARENTHOLD, Texas
    MIKE KELLY, Pennsylvania

                       Lawrence J. Brady, Staff Director
                    John D. Cuaderes, Deputy Staff Director
                         Robert Borden, General Counsel
                           Linda A. Good, Chief Clerk
                     David Rapallo, Minority Staff Director

       Subcommittee on Technology, Information Policy, Intergovernmental
                        Relations and Procurement Reform

                       JAMES LANKFORD, Oklahoma, Chairman
    MIKE KELLY, Pennsylvania, Vice       GERALD E. CONNOLLY, Virginia,
        Chairman                             Ranking Minority Member
    JASON CHAFFETZ, Utah                 CHRISTOPHER S. MURPHY, Connecticut
    TIM WALBERG, Michigan                STEPHEN F. LYNCH, Massachusetts
    RAUL R. LABRADOR, Idaho              JACKIE SPEIER, California
    PATRICK MEEHAN, Pennsylvania
    BLAKE FARENTHOLD, Texas

                                C O N T E N T S

                                  ----------
                                                                       Page
    Hearing held on March 11, 2011...................................     1
    Statement of:
        Miller, Ellen, co-founder and executive director, Sunlight
          Foundation; Danny A. Harris, Chief Information Officer,
          Department of Education; Christopher L. Smith, Chief
          Information Officer, Department of Agriculture, accompanied
          by Jon M. Holladay, Acting Chief Financial Officer, U.S.
          Department of Agriculture; and Jerry Brito, senior research
          fellow, Mercatus Center at George Mason University.........    15
            Brito, Jerry.............................................    43
            Harris, Danny A..........................................    27
            Miller, Ellen............................................    15
            Smith, Christopher L.....................................    33
        Werfel, Daniel I., Controller, Office of Management and
          Budget.....................................................    65
    Letters, statements, etc., submitted for the record by:
        Brito, Jerry, senior research fellow, Mercatus Center at
          George Mason University, prepared statement of.............    46
        Connolly, Hon. Gerald E., a Representative in Congress from
          the State of Virginia, prepared statement of...............     8
        Cummings, Hon. Elijah E., a Representative in Congress from
          the State of Maryland, prepared statement of...............    12
        Harris, Danny A., Chief Information Officer, Department of
          Education, prepared statement of...........................    30
        Lankford, Hon. James, a Representative in Congress from the
          State of Oklahoma, prepared statement of...................     4
        Miller, Ellen, co-founder and executive director, Sunlight
          Foundation, prepared statement of..........................    18
        Smith, Christopher L., Chief Information Officer, Department
          of Agriculture, prepared statement of......................    35
        Werfel, Daniel I., Controller, Office of Management and
          Budget, prepared statement of..............................    68

      TRANSPARENCY THROUGH TECHNOLOGY: EVALUATING FEDERAL OPEN-GOVERNMENT
                                    EFFORTS

                                  ----------

                             FRIDAY, MARCH 11, 2011

                      House of Representatives,
       Subcommittee on Technology, Information Policy,
    Intergovernmental Relations and Procurement Reform,
                  Committee on Oversight and Government Reform,
                                                        Washington, DC.
        The committee met, pursuant to notice, at 10 a.m., in room
    2154, Rayburn House Office Building, Hon. James Lankford
    (chairman of the committee) presiding.
        Present: Representatives Lankford, Chaffetz, Walberg,
    Labrador, Meehan, Farenthold, Kelly, Connolly, Lynch, and
    Murphy.
        Also present: Representatives Issa and Cummings.
        Staff present: Ali Ahmed, deputy press secretary; Molly
    Boyl, parliamentarian; Benjamin Stroud Cole, policy advisor and
    investigative analyst; Gwen D. Luzansky, assistant clerk;
    Christopher Hixon, deputy chief counsel, oversight; Hudson T.
    Hollister, counsel; Ryan Little, manager of floor operations;
    Justin Lo Franco, press assistant; Mark D. Mann, senior
    professional staff member; Tegan Millspaw, research analyst;
    Laura I. Rush, deputy chief clerk; Peter Warren, policy
    director; Jill Crissman, minority professional staff member;
    Carla Hultberg, minority chief clerk; Adam Miles and Amy
    Miller, minority professional staff members; Donald Sherman,
    minority counsel; and Cecelia Thomas, minority counsel/deputy
    clerk.
        Mr. Lankford. The committee will come to order.
        This is a hearing on Transparency through Technology,
    Evaluating the Federal Open-Government Efforts.
        Let me read our mission statement for this committee, so it
    will be very clear why we are here. We exist as the Oversight
    and Government Reform Committee to secure two fundamental
    principles. First, Americans have a right to know that the
    money Washington Takes from them is well spent. Second,
    Americans deserve an efficient government that works for them.
    Our duty on the Oversight and Government Reform Committee is to
    protect these rights. Our solemn responsibility is to hold
    government accountable to taxpayers, because taxpayers have the
    right to know what they get from their government. We will work
    tirelessly and in partnership with citizen watchdogs to deliver
    the facts to the American people and bring genuine reform to
    Federal bureaucracy.
        This is the mission of the Oversight and Government Reform
    Committee.
        I will make a quick statement of what I think we are headed
    toward today on that. The focus of today's hearing is
    Transparency through Technology. The Oversight Committee has a
    strong history of promoting advancements in this area. During
    the 111th Congress, under the leadership of then-Chairman Towns
    and Ranking Member Issa, the committee worked on a bipartisan
    basis to pursue technology-driven transparency initiatives. I
    look forward to continuing that work and joining the
    administration in its efforts to fully implement its Open
    Government Directive and other transparency-related
    initiatives.
        President Obama, while in the Senate, joined Senator Coburn
    in shepherding the passage of the Federal Funding,
    Accountability and Transparency Act. This act required the
    administration to create a single, searchable Web site,
    accessible by the public at no cost, that will provide
    information on all transactions over $25,000. The result was
    USAspending.gov, first launched in December 2007. President
    Obama and Senator Coburn deserve great praise for having the
    foresight that the Federal Government use available
    technologies to meet the public's right to know how their tax
    dollars are being spent.
        Unfortunately, despite a number of expensive makeovers,
    USAspending.gov still fails to achieve the total goal at 3
    years after its launch because of some well-known data quality
    issues that we will discuss, I am sure, as we go through. Data
    from USAspending.gov comes from two sources, one that collects
    information from Federal agencies on contract expenditures and
    one that collects information from Federal agencies on grants,
    loans and other spending. GAO has reported that these two data
    sources are riddled with errors, largely due to human error and
    a lack of agency oversight over its data submissions.
        The administration's Data.gov initiative is similar to
    USAspending.gov. It is a commendable area and one that in
    principle, I agree with wholeheartedly. The Federal Government
    collects and generates an enormous amount of data that is
    largely invisible to the American citizen, but was paid for by
    the American citizen. This data is also invisible to the
    reporter or watchdog group that is trying to hold the
    Government accountable, or the entrepreneur who might be able
    to take that data and create new products, services or jobs in
    ways never contemplated by the Federal bureaucracy.
        Unfortunately, the implementation of Data.gov has not
    matched its promise. The administration required agencies to
    publish at least three high value data sets that had not
    previously been published. There was little guidance, however,
    as to what constituted a high value data set. As the Sunlight
    Foundation's director has said of this, ``The Government has
    some pretty interesting ideas about what they regard as high
    value data. The Department of the Interior seems to think that
    the population count of wild horses and burros is a high value,
    but records of safety violations is not. We want to see data
    that can be used to hold the Government and entities that
    report to it accountable.''
        Data about spending. Department missions and personnel are
    noticeably absent from Data.gov. If this data was public, it
    would save time and expenses as groups request basic reports
    and data from their government. This is highlighted by an
    article in Politico yesterday detailing how a watchdog group
    has been requesting long-term budget projections from OMB that
    were available in previous years, but they are now being
    withheld.
        In addition to data quality and data value, I hope to
    discuss with our witnesses today the issue of data standards
    and interoperability among Federal data systems. If a taxpayer
    wants to look at how much an agency plans to spend on a
    particular program, from and how much Congress ultimately
    appropriates, and then matches that figure with the information
    from USAspending.gov on organizations that receive from the
    program, and then compare that with the information on the
    impacts of the program from information published on Data.gov,
    he or she simply couldn't do it.
        These data systems lack the common data standards; they are
    not interoperable. Not only do they lack a common data
    standard, they sometimes violate even the most basic data
    standards in areas like separating the State field from the
    address field to allow for easy searches.
        I look forward to hearing from our witnesses today and hope
    that we can begin a fruitful discussion of what is working,
    what isn't, what are the next steps each of us should take to
    ensure the Federal Government is utilizing all the technology
    available to provide true transparency to the American public.
        I do want to take this moment to commend the work done by
    OMB for Recovery.gov, Data.gov and USAspending.gov. This is the
    first administration to make this kind of data available, and
    the first attempt will always have some errors. It is not our
    intent today to belittle the efforts of this administration,
    only to discover the important lessons learned and to hear the
    steps that are being taken to move things forward.
        I will now defer to the ranking member for his opening
    statement.
        [The prepared statement of Hon. James Lankford follows:]

        [GRAPHIC] [TIFF OMITTED] T7567.001

        [GRAPHIC] [TIFF OMITTED] T7567.002

        Mr. Connolly. Thank you, Chairman Lankford. I want to
    applaud you for your decision to hold this hearing and for the
    tone you have set in your opening statement about the subject
    matter and the administration.
        Too often oversight focuses only on failures when our role
    should be to rectify failures while publicizing and encouraging
    the dissemination of best practices. In the case of Federal
    transparency and technology, consider where we were four short
    years ago. There was no centralized site for citizens to read
    about Federal spending, projects in the congressional district,
    or summaries of investments for major bills like the Recovery
    Act.
        Today, citizens can access comprehensive Federal spending
    information at USAspending.gov. As a result of House rules
    adopted under the previous Congress, all earmarked requests
    have also been posted on each Member's Web site for each of the
    last 2 years. Finally, thanks to Recovery.gov, all Recovery Act
    investments have been readily accessible to anyone with an
    internet access.
        These reforms have been a collaborative effort. Then-
    Senator Obama and Senator Coburn wrote legislation to
    consolidate information on Federal spending, the result of
    which was USAspending.gov. The House adopted rules to require
    public disclosure of earmarks to be posted online. President
    Obama undertook an unprecedented effort to make public his
    administration's implementation of the Recovery Act as well as
    information technology and other investments.
        Finally, non-governmental organizations have monitored the
    accuracy of those reporting instruments and their efforts have
    identified the suggested ways to improve the reliability of the
    reported data. As we continue to expand these transparency
    initiatives, I believe we should demand that we are receiving
    the greatest possible utility for these programs. Resources
    dedicated to reporting should lead to greater public
    understanding and promote accountability.
        As the Government works toward achieving transparency
    goals, we need to consider any impact that greater reporting
    costs may have on the infrastructure and educational
    investments this country needs. During this period of budget
    uncertainty, these potential tradeoffs are real considerations
    that I hope all of our witnesses today will also address.
        Another question is how we report and consider the benefits
    of Federal spending programs. It is important for our
    constituents to understand what they are getting from a Federal
    investment as it is to understand how much money is being
    spent. Because not all spending is the same. Not all spending
    has the same impact on the quality of life or on the economy.
        In addition, as we consider the results of different
    expenditures, it is important to treat all Federal expenditures
    equally, that is, including those buried in the tax code. Tax
    expenditures account for over $1 trillion in foregone revenue
    annually. While tax expenditures differ from other spending in
    form, in reality these are simply spending and policy programs
    administered by the IRS.
        Of course, many tax expenditures have a valid purpose, but
    as a whole, they do not receive the same scrutiny as direct
    expenditures, even though they have the same impact on the
    Federal budget. They are not listed on USAspending.gov, and
    they are not subject to the accountability mechanisms that
    apply to other forms of spending.
        The Fiscal Commission recommended that Congress carefully
    consider the impact of tax expenditures on the budget. I
    believe that this committee should look into those
    opportunities to make sure these IRS-administered spending
    programs are working for all Americans and not just those
    receiving the tax break.
        I look forward to working with members of the subcommittee
    and with you, Mr. Chairman, to ensure that we are working
    toward this comprehensive presentation of Federal expenditures
    and their impacts. I yield back.
        [The prepared statement of Hon. Gerald E. Connolly
    follows:]

    [GRAPHIC] [TIFF OMITTED] T7567.003

        Mr. Lankford. Thank you.
        I would like to recognize, as many of you know, this is a
    subcommittee of Oversight and Government Reform, we do have the
    chairman for the committee as a whole here, and I would like to
    recognize Chairman Issa for an opening statement.
        Chairman Issa. I thank you, Chairman, and I would also
    recognize that the full committee ranking member is here.
        This is the most important issue of this committee in the
    long run. We are a committee that on a day to day basis
    obviously deals with the events, the failures in Government,
    and the need for reform, short term. Today, like every other
    hearing that is about oversight, transparency and getting it
    right, particularly in data reporting, we are dealing with what
    is ultimately going to be the fix.
        I came from the private sector, where the idea that there
    would be data entry errors, and that those data entry errors
    would be different than the actual payments, was unheard of. If
    someone is typing in something for a report, rather than taking
    the actual data as it went out on a purchase order, an invoice,
    or some other disbursement, then by definition, you are not
    giving people the honest results of what Government did. You
    are giving them somebody's interpretation of the honest result.
        If they are completely accurate, then all you have wasted
    is a huge amount of human capital. If they are inaccurate, then
    you have data which is worthless.
        Today, I am very proud that I have a panel of four here,
    both Government and very responsible people within the watchdog
    community, to talk about transparency, to talk about reporting,
    and to continue with our process of getting it right in the
    future. I regret we have a second panel. We have a second panel
    for an inexplicable reason that OMB has told us that they will
    not sit with non-government entities, that they have a
    longstanding policy.
        I have been here only going on 11 years. But it is not that
    long a policy. I would hope that in the future, we can have the
    responsible people who are in the data use business and the
    data transparency business as often as possible, when
    appropriate and vetted, with the Government people who are
    charged with working to do that.
        Today's hearing is not the first, and it won't be the last
    in this process. Until every dollar from the time it leaves the
    taxpayer's account or for that matter, the dollar deposited
    when you want to go into a Federal park, until the last dollar
    is spent or disbursed, either used to pay a Federal employee or
    disbursed through the system in the private sector, until that
    is accounted from womb to tomb, we will not have done our job.
        When we get to that point, then the job that we all want
    done, which is full accountability with virtually no loss,
    theft or waste, will be possible. Today it is not possible.
    This hearing is important because the failure to get the data
    right is the reason that ultimately we are not getting the
    responsible government. And day after day, we are told $100
    billion, $200 billion, $300 billion would be saved if we simply
    stopped disbursements to people or to entities which do not
    deserve them.
        So until we get there, this committee will have no more
    important issue than the one we are here today. This is a
    subcommittee hearing, but you have both of the chairs and
    ranking members for the reason that the work you are doing is
    the most important work of the Congress.
        Thank you, and I yield back.
        Mr. Lankford. Thank you, Mr. Chairman.
        I would also like to recognize the ranking member of the
    entire committee as well, Mr. Cummings. Glad that you are here.
    We would be open to receive your opening statement.
        Mr. Cummings. Thank you very much, Mr. Chairman. To
    Chairman Lankford and Ranking Member Connolly, certainly to
    Chairman Issa, and all the members and the panel. It is
    certainly a pleasure to have all the witnesses here.
        I was just listening to all of what has been said. It is
    true that you play a very important role. Right now, we are in
    a big struggle here in the Congress. Just this morning I had to
    explain to some Morgan State University students why it is that
    many of them may not be able to go to school next year, because
    the Pell grants are being slashed.
        It is painful, because many of those students will never
    return to school. They will never go back. I sit on the board
    of that school and have been there for the last 12 years. And
    we were losing students even with the Pell grants as they are.
    But when they get slashed, it gets worse.
        Then I thought about, as I was just sitting here, I thought
    about a town hall meeting I had on Saturday, where people came
    up to me and said, we have 250 kids in Head Start. But we have
    750 on the waiting list.
        And so what does that have to do with all of this? It is
    about accountability.
        I agree with Chairman Issa that we need to account for
    every single dime. If money is not being accounted for, there
    is a major problem. And that is a sad situation, particularly
    in a country where we can send folks to the moon, but we can't
    keep up with where the money is going. That is a major problem.
        So I am grateful for this opportunity to examine the
    administration's ongoing efforts to bring increased
    transparency to the Federal Government. I want to thank
    Chairman Lankford for giving this President some credit for
    something for a change. This is an issue of critical
    importance, and the Federal Government must be held strictly
    accountable for its expenditures of taxpayers' hard-earned
    dollars.
        On April 15th, there will be people figuring out, trying to
    figure out how they are going to pay the taxes. There are folks
    who, at the end of a week or 2-week period, look at their pay
    stubs and scratch their heads. They are barely making it now,
    if they have a paycheck. So we owe it to them to get it right.
        The passage of the Federal Funding, Accountability and
    Transparency Act of 2006 and the establishment of
    USAspending.gov, as required by the act, have given the average
    American unprecedented ability to track Federal contracts and
    grants. This transparency increases the public's ability to
    hold elected representatives and Federal Government accountable
    for distribution in the use of Federal funds.
        Further, the act and the Government's experience with
    USAspending.gov paved the way for creation of additional Web
    sites that allow the public to track specific types of
    spending, including Recovery.gov and Data.gov.
        The administration's ongoing efforts to improve the quality
    and breadth of data being reported are to be commended. In
    particular, I am pleased that in October 2010, the
    administration began publishing sub-awards on USAspending.gov
    for the first time. However, the Sunlight Foundation's
    September 2010 report shows that there is an opportunity to
    continue improving transparency and make additional information
    publicly available. In other words, we could always do better.
        During the last Congress, I supported legislation that
    moved through this committee to enhance the usability and
    interoperability of Federal financial data. I look forward to
    working together in a bipartisan manner to advance such
    legislation in the Congress.
        OMB must also work to ensure that USAspending.gov
    implements mechanisms to improve the timeliness and accuracy of
    its reporting to the public. However, we should also be mindful
    that pursuit of perfection in the reporting of spending data
    imposes real financial costs, both in dollars and manpower. And
    such costs must be weighed against the benefits they will
    yield.
        I look forward to the witnesses' views on the issues today.
        And finally, let me say this. Any accounting of costs of
    Government spending is inherently incomplete unless it also
    includes data detailing the revenue loss to the Government
    through tax breaks and incentives to the wealthiest individuals
    and businesses, including businesses that move jobs overseas,
    as children will be thrown out of Head Start, or never get a
    head start, and as young people are thrown out of colleges.
        I look forward to the testimony of our witnesses and to
    working with Chairman Lankford, and certainly Chairman Issa and
    Ranking Member Connolly, to identify and address areas where
    the Federal transparency efforts can continue to be improved.
        With that, Mr. Chairman, I thank you and I yield back.
        [The prepared statement of Hon. Elijah E. Cummings
    follows:]

    [GRAPHIC] [TIFF OMITTED] T7567.004

    [GRAPHIC] [TIFF OMITTED] T7567.005

        Mr. Lankford. Thank you.
        All the Members will have 7 days to submit opening
    statements and other materials for the record.
        I would like to now welcome and introduce the members of
    the panel. Then I will lay some basic ground rules and we will
    receive your testimony from there.
        Ms. Ellen Miller is the Co-Founder and Executive Director
    of the Sunlight Foundation. She is the founder of two other
    prominent Washington-based organizations in the field of money
    and politics, the Center for Responsive Politics and Public
    Campaign, and a nationally recognized expert on transparency
    and the influence of money in politics. Thank you for being
    here.
        Mr. Chris Smith is the Chief Information Officer for the
    Department of Education. Mr. Smith previously served as the
    Chief Information Officer for Rural Development and the U.S.
    Department of Education and as the Information Technology
    Director for Financial Information at the General Services
    Administration. Thank you.
        Switching people back there, Mr. Harris is the Chief
    Information for the Department of Agriculture--did I get those
    two reversed? I did, actually. I got those two reversed. I
    apologize for that. So take all the Education stuff and apply
    it to Mr. Harris, and let me switch to Mr. Smith.
        Mr. Smith is the Chief Information Officer for the
    Department of Agriculture. Mr. Smith previously served as the
    Deputy Chief Financial Officer for the Department. I understand
    that Mr. Jon Holladay, the CFO for the Department of
    Agriculture, will also be advising Mr. Smith. So when everyone
    stands to be sworn in, if you would also stand and be sworn in
    as well.
        Mr. Jerry Brito is a Senior Research Fellow at the Mercatus
    Center at George Mason University. He is the author of several
    published scholarly articles, and a contributor to the
    Technology Liberation Front, a leading tech policy blog. He is
    also the creator of Unclutter, a popular blog about personal
    organization and simple living that is read by a quarter
    million people each month. That is a nice reading list.
        Let me give you the ground rules for our hearing itself
    here. Each of you has been asked to submit a written statement
    for the record. We have also asked you to prepare an oral
    statement no longer than 5 minutes. We will allow time for
    questioning on your statement after that.
        You will see on your desk a series of lights and a clock
    which will count down from 5 minutes. The lights will change
    from green to yellow to red when your time is expired, and it
    will be time at that point to quickly wrap up.
        After all the panel has given their oral statements, each
    Member present will have 5 minute to ask questions of the
    panel. Many Members may have several questions, so it is very
    important that you answer your questions very concisely. Do not
    feel you have to give a lengthy answer on anything.
        Please also forgive the members of this committee as we
    excuse ourselves. Most of us have multiple committee
    assignments going on this morning. We are juggling concurrent
    meetings. Mr. Connolly had to slip out and head to the floor of
    the House as we have things going on there right now. Your
    testimony will be recorded and it will be available for review
    by all of us. I can assure you, it is written down, every bit
    of it, and we will be able to review it in days to come. So
    thank you.
        Each Member completely chooses the content of their 5
    minutes of questioning. I would ask the Members to honor our
    guests' time and attendance by prioritizing answers and
    information from them, instead of making speeches. I would also
    ask all of our Members not to ask a question past their 5-
    minute time. Once it is expired, as the chairman, I reserve the
    right to remind everyone that time is expired and ask for
    proper decorum in our hearings.
        We will have two panels this morning. The first will
    include Ms. Miller, Mr. Smith, Mr. Harris and Mr. Brito. The
    second one will have only Mr. Werfel. It is my understanding
    that the Office of Management and Budget did not want to sit on
    a panel with non-government witnesses, so we have honored their
    request for Mr. Werfel to be separated from the other
    witnesses. We will hear the testimony of the first panel, and
    when we conclude that testimony and our questions, we will
    immediately move to questions and testimony from Mr. Werfel
    individually.
        We are very grateful for all the time you have committed in
    preparing your written and your oral statements, and the time
    you have been away from your family for this hearing. Do you
    understand all the ground rules of this hearing?
        [Witnesses respond in the affirmative.]
        Mr. Lankford. Thank you.
        It is the policy of the committee that all witnesses be
    sworn in before they testify. For all of you that are going to
    be doing any testimony, would you please rise. Please raise
    your right hands.
        [Witnesses sworn.]
        Mr. Lankford. Thank you. Please be seated.
        I would like to recognize Ms. Miller for 5 minutes. Thank
    you.

    STATEMENTS OF ELLEN MILLER, CO-FOUNDER AND EXECUTIVE DIRECTOR,
        SUNLIGHT FOUNDATION; DANNY A. HARRIS, CHIEF INFORMATION
     OFFICER, DEPARTMENT OF EDUCATION; CHRISTOPHER L. SMITH, CHIEF
    INFORMATION OFFICER, DEPARTMENT OF AGRICULTURE, ACCOMPANIED BY
         JON M. HOLLADAY, ACTING CHIEF FINANCIAL OFFICER, U.S.
      DEPARTMENT OF AGRICULTURE; AND JERRY BRITO, SENIOR RESEARCH
           FELLOW, MERCATUS CENTER AT GEORGE MASON UNIVERSITY

                       STATEMENT OF ELLEN MILLER

        Ms. Miller. Thank you, Chairman Lankford, Ranking Member
    Connolly, and Mr. Cummings and members of the committee. Thank
    you for the invitation to appear before you today.
        My name is Ellen Miller, and I am co-founder and executive
    director of the Sunlight Foundation, a non-partisan, non-profit
    dedicated to using the power of the internet to catalyze
    greater government openness and transparency. We take our
    inspiration from Justice Brandeis' famous adage, ``Sunlight is
    said to be the best of disinfectants.''
        The public has a right to know how its government works.
    Recent Congresses deserve congratulations for taking concrete
    steps toward embracing a 21st century vision of transparency.
    Initiatives from this administration, like the Open Government
    directive, are emblematic of the willingness to take
    transparency seriously.
        Unfortunately, the Open Government directive's value has
    proven to be largely aspirational. While establishing positive
    transparency norms is hugely important, we believe that
    government must now focus on the harder challenges. It is no
    longer enough to acknowledge transparency's importance;
    transparency initiatives must be accurate, complete and useful
    as well as timely.
        There is perhaps no better example of the tension between
    show and tell than USAspending.gov. Disclosure of the ways in
    which the public's money is spent is among the most important
    types of government transparency. Congress recognized this in
    2006, with the passage of the Federal Funding, Accountability
    and Transparency Act, which required that information about
    Federal grants, contracts, loans and insurance be placed online
    in a searchable Web site known as USAspending.gov.
        In the course of their work, Sunlight researchers have
    become deeply familiar with the data powering USAspending.gov.
    As we began to examine these systems, we were aware that the
    quality of the data sets was widely considered problematic. Our
    work quickly confirmed that data suffered from irregularities.
    However, we were anxious to reach an even more complete
    understanding of the problem, so we dug in.
        In order to do so, we needed a reference point against
    which we could compare the USAspending.gov data. Unfortunately,
    the complexities of the Federal budget make both the budget and
    Treasury expenditure data unsuitable for that use. We found our
    yardstick in the Catalog of Federal Domestic Assistance, an
    index of many Federal programs, including program descriptions
    and yearly obligation amounts. Although not strictly designed
    for this use, CFDA has been used for comparative analysis by
    GAO in the past.
        We took their methodology and expanded it. Like GAO, we
    looked for mismatches in amounts between CFDA and
    USAspending.gov data, allowing a generous margin of error to
    account for differences in the systems. We also looked for
    instances in which reports had been made within statutory
    deadlines, and for incomplete reports. Finally, we automated
    GAO's sample-based methodology, so that we could examine the
    entire data base which consists of hundreds of thousands of
    records.
        The results were sobering. We found over $1.2 trillion of
    mis-reported spending in 2009 alone. Some of the most serious
    problems appeared to be caused by the agency's failure to meet
    their reporting obligations. The USDA Web site lists the cost
    of their school breakfast program and lunch programs at $12.7
    billion. But only $250,000 of these costs are reported on
    USAspending.gov.
        The Maritime Administration has never reported spending
    associated with any of its loan or insurance programs and
    reports only a fraction of its grant activity. These are just
    two examples. Almost every agency has one or more programs that
    failed to report their spending.
        And the spending that is reported is often incomplete or
    incorrect. For example, each loan record is required to include
    both a subsidy cost and the face value of the loan.
    Unfortunately, the subsidy cost is incorrectly reported as zero
    for over 85 percent of the loan records. And the face value of
    all fiscal year 2010 student loans was reported as $6.9
    trillion, an amount greater than the entire Federal budget.
    Clearly, that number is wrong.
        We do not believe that these problems are the fault of the
    USAspending.gov Web site or the people that maintain it.
    Indeed, USAspending.gov deserves praise for its growth and
    improvement. When we conducted this analysis, we had to send a
    hard drive out to Maryland to get the data. Today, we can
    download it directly from the Web site.
        Similarly, we are pleased to see the administration finally
    begin to offer the sub-award data maintained by FFATA. But
    these improvements will be meaningless for the vast majority of
    users if the underlying data is not reliable. Agencies
    typically use purpose-built internal systems for managing their
    spending that are separate from the public reporting systems
    and much more accurate. In essence, they maintain two sets of
    books, one of which is habitually neglected.
        But this latter system is vitally important for both the
    public and Government planning efforts. And until the agencies
    begin to take these responsibilities more seriously, Federal
    spending transparency will remain an unfulfilled promise.
        We welcome the committee's attention to this issue and
    encourage you to continue to spend time in engaging oversight
    and legislative efforts on this important topic. Thank you for
    the opportunity to testify today. My colleagues and I, Tom Lee
    and Kaitlin Lee, look forward to your questions. Thank you.
        [The prepared statement of Ms. Miller follows:]

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        Mr. Lankford. Thank you.
        Dr. Harris, I am going to appropriately recognize you at
    this point. Thank you for being here. We will receive your
    testimony.

                      STATEMENT OF DANNY A. HARRIS

        Mr. Harris. Thank you, and good morning, Chairman Lankford
    and members of the subcommittee.
        Thank you for the opportunity to appear before the
    subcommittee today. My name is Danny Harris and I am the Chief
    Information Officer at the U.S. Department of Education, a
    position I have had the privilege to hold since October 2008. I
    am very pleased to discuss the Department's transparency
    efforts specific to the Open Government initiative.
        On his first day in office, the President sent a memo
    directing all Federal agencies to create unprecedented levels
    of openness in Government. The Department of Education has
    taken this directive very seriously. Our Open Government plan
    makes our efforts more transparent, participatory and
    collaborative. I am personally committed to these goals, and
    the Department looks forward to building upon the solid
    foundation put in place during the first 2 years of this
    initiative.
        For decades, the Department has collected, analyzed and
    used data to inform our delivery of services. At the Department
    of Education, we collect data about the overall condition and
    effectiveness of education provided by the States, local
    educational agencies and institutions of higher education. A
    key part of our mission is to provide useful information to
    States, assisting their efforts to allocate resources to
    education citizens in the most effective and efficient way.
        Equally important to our mission is supporting the use of
    Federal resources toward ensuring fair access to education for
    all. Open Government efforts place special emphasis on
    providing information to the public leading to increased
    transparency and to the information we and States use for
    decisionmaking.
        At the Department of Education, we have established a
    cross-functional team to develop our Open Government plan,
    which is available on our Web site. Also, we have established a
    governing body to oversee departmental execution of the Open
    Government plan and to improve the efficiency and effectiveness
    of all of the information collection and dissemination
    activities at the Department.
        Decisions and recommendations from this board will and do
    affect IT spending. This coordinated effort will effectively
    manage duplicative data requests, it will reduce burdens to the
    States and local agencies, and it will optimize Department-wide
    data aggregation. At the end of the day, it is not just about
    the data that we deliver, it is about delivering tools to drive
    innovation.
        Prior to implementing Open Government efforts, we provided
    similar information and tool sets, allowing citizens to view
    the information in ways that we thought were useful. Open
    Government altered this framework, and now we deliver the same
    information in a raw, machine-readable format, allowing
    citizens to analyze the data and transform those data into
    useful, aggregated information. This access to data has
    undoubtedly created new insights and views, enabling previously
    unthought of ways for citizens to understand, view and track
    Federal dollars.
        The clear benefit is that citizens can now view the
    delivery of services with comprehensive information and the
    public's ability to access and analyze these data make Federal
    spending transparent. In turn, this helps ensure departments
    are accountable for results and outcomes.
        The challenge for the Department is to ensure the quality
    of this data. We view key attributes of quality as timeliness,
    accuracy and most of all, privacy. The challenge for our
    stakeholders is to establish proper awareness and context for
    these data. We have already seen positive outcomes as a result
    of these initiatives. For example, in our Race to the Top
    program, we provided a detailed description of the process used
    to review and select the winners of that program. The
    Department, in implementing Race to the Top, has demonstrated
    unprecedented transparency by posting all of the applications
    as well as peer reviewer scores and comments to the public for
    review.
        To help spur innovation, our Investing in Innovation team
    created an open innovation portal, a Web site where education
    innovators can share ideas and collaboration, where funders and
    educators can point out their needs, and where people can
    gather to propose, develop, fund, implement and more than
    anything else, improve solutions inside and outside of the
    classroom.
        We take the commitment to transparency seriously at all
    levels within the Department. For example, in 2009, Secretary
    Duncan launched his Listening and Learning Tour. He did this to
    engage the public directly in discussing education reform in
    America. The Department used the input we received to prepare a
    blueprint for reauthoring the Elementary and Secondary
    Education Act.
        Transparency through technology provides an opportunity to
    engage with the public in making the Department of Education
    more accountable. Specifically, the Department has a
    significant role in complying with the Federal Funding and
    Accountability Transparency Act, due to the very large number
    of grants, contracts and loans that we administer. These funds
    go to numerous recipients and sub-recipients in States and
    territories, and the public should know where these funds are
    going, for what purpose, and most importantly, what results
    they should expect. We submit grant and loan funding
    transactions on a bi-weekly basis from our grant system in the
    Federal assistance award data system file layout.
        Additionally, we provide our contract funding transactions
    to the Federal procurement data system in real time during our
    contract award. Both our grants and contract systems are
    integrated with the Department's general ledger. This ensures
    that the transactions that we submit to USAspending.gov are
    directly traceable to our financial systems.
        Finally, the Privacy Act and Federal guidelines govern how
    we protect personally identifiable information while at the
    same time complying with the Transparency Act and other public
    reporting requirements.
        In conclusion, I believe that Open Government,
    USAspending.gov, Federal reporting and other recovery Web sites
    all work together to put more and better information in the
    hands of the public. The benefits are tremendous, because these
    efforts lead to increased accountability, transparency, and
    more than anything else, recognizable links between spending
    and results.
        Thank you, chairman and members of the subcommittee, for
    your attention to this important issue. I would be happy to
    answer any questions you may have.
        [The prepared statement of Mr. Harris follows:]

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        Mr. Lankford. Thank you, Dr. Harris.
        Mr. Smith.

                   STATEMENT OF CHRISTOPHER L. SMITH

        Mr. Smith. Thank you, Chairman Lankford, Ranking Member
    Connolly, members of the subcommittee, Chairman Issa, who was
    with us here earlier. Thank you for this opportunity to share
    with you our progress on the implementation of the Open
    Government initiatives, transparency and accountability in the
    use of information technology to further these important goals.
        I am joined today by my colleague, Jon Holladay, who is the
    USDA Acting Chief Financial Officer, just behind me.
        USDA programs touch every American and many others around
    the world every day. We are focused on the activities that
    ensure an economically thriving rural America, that we are
    conserving our national forests and private working lands, and
    promoting sustainable agricultural production and biotechnology
    exports to ensure and increase food security and to provide
    access to a nutritious diet for all Americans.
        Full and easy access to information on Government spending
    promotes accountability by allowing detailed tracking and
    analysis of deployment of these resources. Tracking and
    analysis allows the public and public officials to gauge the
    effectiveness of expenditures and to monitor spending patterns
    to achieve the best possible results. Transparency also gives
    the public confidence that we are properly managing its funds.
        From the Transparency Act of 2006 to the Open Gov directive
    of 2009, Government transparency has become the cornerstone for
    information access to facilitate participation and
    collaboration across Federal, State and local governments and
    with the public. USDA is a strong advocate of Government
    transparency and is striving to meet both the letter and intent
    of the Open Government Directive.
        On December 8, 2009, the White House issued the Open
    Government directive, requiring Federal agencies to take
    specific action to promote transparency, collaboration and
    participation. The Open Government directive puts
    accountability and accessibility at the center of how Federal
    Government operates. It instructs agencies to share information
    with the public through online, open and accessible, and as my
    colleague has stated, machine readable formats.
        USDA fully supports the administration's directive for open
    government and is actively engaged on this front in making the
    Department more accessible and accountable to our citizens. To
    foster accessibility, USDA launched its OpenGov Web site in
    spring of 2010 and published an open government plan describing
    how USDA would improve transparency and integrate public
    participation and collaboration into its activities.
        With the launch of our Web site, citizens are able to learn
    about and comment on USDA information and post their ideas on
    transparency and collaboration, and actively participate with
    the Department. The public can also post ideas to help USDA
    become more efficient and more effective in everything that we
    do.
        Additionally, to improve outreach initiatives, USDA has
    established an open government communication plan, which
    describes USDA's interaction and collaboration and details the
    activities that we are taking.
        USDA is leveraging information technology to improve
    transparency and increase citizen interaction and
    participation. Two good examples are USDA's My Pyramid and Apps
    for Healthy Kids, which are innovative approaches to USDA
    reaching out and encouraging collaboration with the private
    sector and the public.
        The Applications for Healthy Kids competition was a
    collaborative project to challenge the general public to design
    online mobile gaming tools and educational applications to
    educate people about the importance of healthy eating and
    physical activity. USDA's Food and Nutrition Service,
    Department of Health and Human Services, First Lady Michelle
    Obama's Let's Move initiative and the NFL's Fuel Up To Play 60
    played a vital role in this challenge. Over 45,000 participants
    submitted 95 games and applications, with 12 submissions
    selected as the ultimate winners.
        Additionally, as a part of the USDA Open Government
    flagship initiatives, the Forest Service directly improved
    transparency, collaboration and participation by increasing
    public participation in the development of its land management
    planning rule by leveraging information technology to improve
    collaboration and interaction. Using Web 2.0 technologies and
    online collaborative environments, the agency provided the
    public with updates on the planning rule process and enabled
    them to submit comments.
        The agency also held public meetings and listening sessions
    all over the country to gain input from these citizens. More
    than 700 individuals were not able to attend these in person.
    Using collaborative technologies, they were able to participate
    remotely.
        The development of this proposed rule involved more than
    26,000 comments on the notice of intent and more than 40 public
    meetings with over 3,000 participants, including the National
    Science Forum, tribal consultation and Forest Service employees
    submitting comments. This increased focus on accountability and
    transparency built upon our commitment to strong financial
    stewardship as evidenced by USDA compliance with the
    Transparency Act.
        In September 2006, the Transparency Act was enacted. As
    required by the act, the Office of Management and Budget
    established the USAspending.gov Web site to provide
    transparency of Federal spending by disclosing entities
    receiving the funds. USDA sends bi-weekly transmissions to the
    Federal Financial Assistance system, reporting any award over
    $25,000. We report the key data elements regarding Federal
    award within 30 days after that award. And USDA data being
    reported to the public includes grants, cooperative agreements,
    direct and guaranteed loans, direct payments, insurance and
    contracts.
        USDA has a comprehensive information technology
    modernization strategy that encompasses the improvement of this
    data collection and the sharing of that with our citizens. I
    look forward to your questions and discussion, sir.
        [The prepared statement of Mr. Smith follows:]

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        Mr. Lankford. Thank you. You could not have been closer on
    time as well. Thank you, Mr. Smith.
        Mr. Brito, pleased to get your oral testimony in 5 minutes.

                        STATEMENT OF JERRY BRITO

        Mr. Brito. Thank you, Mr. Chairman, members of the
    committee.
        Thank you for inviting me to testify on transparency
    through technology.
        As someone who believes that Internet-enabled transparency
    can lead to better and more accountable government, I am
    gratified by Government's efforts in this base for the past 5
    years. Transparency is an issue that has been genuinely
    embraced by both sides of the political aisle. What was once an
    esoteric concept, that meaningful transparency requires
    disclosures to be online and open, searchable in machine
    readable format has become a generally accepted ideal. Those
    are great strides.
        However, despite the Obama administration's technological
    efforts and congressional legislation like the Federal Funding
    Accountability and Transparency Act, whether government is
    performing effectively is still not completely transparent.
    That is because the vast majority of newly available data is
    not about government, and disclosures that are about government
    tend to report its activities, not data on program outcomes.
    When program outcomes are reported, they tend to be suspect
    because they are self-measured and self-reported by program
    managers.
        On Data.gov, the government has compiled wonderful, never
    before available data sets about regulated industries but
    little about its own performance. Excluding the 305,000
    datasets that pertain to geodata, the Data.gov data catalog
    makes available just over 3,000 ``raw'' datasets. Of these,
    about half are related to the Toxic Release Inventory compiled
    by the EPA. These are disclosures about regulated entities
    that, while very valuable to individuals and researchers, tell
    us little about the performance of government.
        A quick scan of the remaining 1,500 datasets reveals that
    only 200 to 300 report on the activities or performance of
    government. There is plenty of smoke, but little fire.
        One of the better datasets available is Research.gov. This
    National Science Foundation data base of federally funded
    science and engineering research allows users to search for
    grants by keyword, location, or grantee; see which grants were
    awarded and for how much; and learn about the results of each
    specific, federally funded research project. This information
    is useful in holding Government accountable for its
    performance.
        Less useful, although no doubt valuable to some
    researchers, are datasets like one from the U.S. Geological
    Survey on the effects of fire on Rocky Mountain Olive-Side Fly
    Catcher Bird nests. Spending-transparency sites like
    USAspending.org and the Recovery.gov site are also useful
    because they disclose government's actions. They allow
    citizens, watchdogs, bloggers and reporters access to the raw
    data of the business of government. It allows them to make
    creative uses of the data, including making interesting mashups
    and allowing them to crowd-source accountability.
        However, these types of sites are not perfect. As the
    Sunlight Foundation and others have pointed out, the quality of
    the data available can be sorely lacking. Also, until recently,
    only information about the primary recipient of a contract or
    grant award was available on USASpending.org, thus limiting the
    usefulness of the site.
        More broadly, while spending sites can help uncover
    instances of fraud, waste, and abuse, which is very important,
    they are less helpful in measuring performance because they
    simply disclose outputs, amounts of money disbursed to
    recipients and simple descriptions of contracts or grants. To
    determine whether a program is performing as intended the
    public needs information not only about outputs, but also about
    outcomes.
        With a Federal spending crisis on our hands, Congress must
    soon decide which programs to cut and which to keep. Voters
    will have to decide if they support Congress' choices. The
    whole process would be much easier if information existed about
    the relative performance of Government programs.
        In the private sector, a corporation must disclose its
    earnings as well as its expenditures and assets on a quarterly
    basis. Such an objective measure of performance not only allows
    the market to set a stock price, but it also allows
    shareholders to hold management accountable.
        Now, think of Government transparency. All agencies and
    programs disclose their expenditures in an annual budget and
    through sites like USAspending.gov. What Government does not
    report are earnings figures, for the simple reason that there
    are none. Therefore, a Government program may be transparent,
    and yet the public sees only half of the balance sheet.
        Congress tried to solve this problem with the Government
    Performance and Results Act. The problem with GPRA performance
    reporting, however, is that the very managers of the programs
    are charged with developing performance measures, measuring
    their own programs and writing self-evaluating performance
    reports. Even in the NSF's Research.gov site, which I
    mentioned, it is the award recipients who write the performance
    reports.
        In the private sector, Congress has recognized that this
    doesn't work. Congress has required that publicly traded
    companies must hire independent third party auditors to help
    prepare and certify reports. Under the Sarbanes-Oxley Act,
    corporate managers are personally liable for the veracity of
    those reports. Congress might want to consider similar,
    independent audits of agency performance reporting.
        I am looking forward to the launch of the new
    Performance.gov initiative by OMB, which promises to provide
    data-driven reviews of progress toward clearly defined goals at
    Federal agencies. Those reviews, however, won't be very
    meaningful if they are self-reported or based on shaky data.
        The progress Congress and the Obama administration have
    made in making transparency, and especially online
    transparency, a key objective for Government cannot be
    overstated. The culture of secrecy that has long pervaded
    Federal agencies is beginning to change. However, we must make
    sure that Open Government is first and foremost about
    transparency. And that transparency is clearly understood as
    disclosure of Government performance in the service of greater
    accountability.
        Thank you, and I look forward to your questions.
        [The prepared statement of Mr. Brito follows:]

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        Mr. Lankford. Thank you very much. I thank all of you for
    preparing a statement.
        I would like to begin, I have 5 minutes allotted, I am
    going to yield those 5 minutes to my vice chairman, Mr. Kelly,
    for him to start our opening questions.
        Mr. Kelly. Thank you, Mr. Chairman. Thank you all for being
    here today.
        I come from the private sector, so I have a little bit of
    an idea about having skin in the game. And Mr. Brito, I am
    really interested, when you talked about the principal and the
    agent reporting program, because I have always thought, in my
    business, you don't want the fox watching the hen house.
        So could you expand a little bit more on where we should go
    with this? Because I am having an awful tough time following
    some, we talk the talk but we don't walk the walk in
    Government? And we tell you how you should do it, but we never
    do it ourselves? So if you could just expand a little bit on
    what the purpose would be in having an outside agency looked
    at. Because in my business, I always bring in outside auditors.
    I would never, ever do it internally. It gives you a false
    picture. It gives you a completely unrealistic idea of what is
    going on with your business.
        And I will tell you, the No. 1 thing that I find out when
    we hire a new person, they come in after their first pay and
    they say, I thought I was getting paid more. I say, well, this
    is what we paid you. Now, look through all the deductions and
    this is what you are taking home.
        So there is a huge difference between what we pay and what
    they take home. And they ask me, where did it go? And I say,
    well, take a look and you can find out, it went to the
    Government. And they say, well, what the heck are they doing
    with my money? I say, you know what, that is anybody's guess,
    isn't it?
        So if you could just tell me a little bit about what you
    would suggest as far as outside auditors.
        Mr. Brito. Sure. Economists will talk about a concept
    called principal agent problem, which is very simple. Let's say
    you have a corporation which is owned by shareholders,
    thousands of shareholders. They hire a board of directors to
    manage a corporation and the board hires a CEO and the
    management.
        Now, the board can't be behind watching the CEO all the
    time. And so for that reason, that is the very reason they hire
    managers, to manage corporations. Quarterly, yearly, the board
    meets to review the performance of management. What sort of
    data do they look at? Well, they look at profit and loss. And
    it is very clear.
        With Government, we don't have profit and loss. So we need
    to develop performance measurement. And the way that works is
    very simple, this is what Congress did in the Government
    Performance and Results Act, which is that, for a program, the
    agency, before it begins a program, needs to say, these are the
    results we expect to achieve. These are the data-driven
    measurements that we will use to determine whether we met those
    results. And then at the end of the period, whether it is a
    year or quarterly, you measure and you see whether you met
    those results.
        If you didn't meet those results, well, then, Congress can
    go look at that program, see how it can be fixed, see if it
    needs to be eliminated. Unfortunately, the responsibility of
    creating the measurements, of measuring and of reporting is all
    on the very same agency that runs the program. And so that
    creates, again, this principal agent problem.
        In the private sector, you wouldn't expect simply to take
    management's word about the performance of the company. You
    bring in a third party auditor. That is required by Congress.
        But even if it wasn't required by Congress, I would suspect
    that shareholders and board members would want to audit the
    information presented to them by management. So that is what I
    am suggesting, that we take a lesson from that, in the private
    sector, and bring it into Government.
        Mr. Kelly. And I respect your statement that we don't have
    profit. I would say we do have loss. And I have never seen any
    business that could run this way consistently, a trillion
    dollars in the red for three straight years, and feel that,
    hey, we are doing all right.
        Ms. Miller, one of the things I found interesting is in
    your written testimony it says that one of the goals of the
    mission statement, ``Sunlight is said to be the best of
    disinfectants.'' I would ask you, and also Mr. Brito,
    USAspending.gov and Recovery.gov have been criticized for not
    containing the information that citizens are most interested
    in. What information do you think is most important, what
    should be made more public?
        Ms. Miller. I will be glad to answer that. I think our
    criticism with respect to the availability of data really
    applies to Data.gov. We certainly agree with Mr. Brito's
    assessment in terms of the amount of data that is actually on
    that site.
        Sunlight advocated, with the administration, that all the
    data that is made available by Government be made available in
    machine readable formats. As you heard from our Government
    colleagues here, the administration has done that. But there is
    just very little information that is made available. It is hard
    for me to sit here, as a resident of Washington, DC, and say
    what someone in your city would be most interested in. But
    Sunlight has been exploring some of this, and we know people
    are interested, desperately, in health care issues, they are
    interested in education issues, they are interested in
    consumer-related banking issues. So we are beginning, actually,
    to develop apps from the publicly made available, the data that
    has been made available either on their own Web sites or on
    Data.gov, to move into this sort of consumer facing information
    that our best instincts tell us need to be there.
        It has not been easy to find this kind of data immediately
    accessible. We need more of what citizens need. I think the
    administration and the various agencies have been asking
    citizens, what do they need. Again, to their credit, we have to
    sort of pull back and maybe in another 6 months try to assess
    that as Government.
        Mr. Kelly. Thanks very much. My time is expired. Thank you,
    Mr. Chairman.
        Mr. Lankford. Thank you.
        I recognize Mr. Lynch for 5 minutes.
        Mr. Lynch. Thank you, Mr. Chairman.
        I want to thank the members of the panel for helping the
    committee with its work.
        I listened closely to your testimony. I just want to ask,
    Ms. Miller, you reported that from the USDA Web site they had
    listed the school lunch program, the cost of the school
    breakfast and lunch program here in the United States was $12.7
    billion. However, according to the USDA, their Web site lists
    the cost at about $250,000. Actually, I think it was
    USAspending.gov that actually listed it that way.
        And then we have Mr. Smith, God bless him, and it sounds
    like everything is just going great over there. I am just
    wondering if, is that how you have assessed the accuracy of the
    USDA reporting? How would you grade them, I guess?
        Ms. Miller. Well, we don't grade the agencies. Because I
    think all of them are struggling. So if we had to say which was
    better than the others, as I mentioned in my testimony, I don't
    think there is a single agency that would get an A. So there
    are failures of different kinds and substance throughout the
    agencies.
        Why those spending amounts are recorded so differently I
    honestly cannot answer. But I suggest Mr. Smith might be able
    to answer why we see such discrepancies.
        Mr. Lynch. Well, let me ask you then, you say that across
    the board, that agencies are keeping two sets of books. And
    this might be one example of that.
        Ms. Miller. It may be.
        Mr. Lynch. They keep a set of books for operational
    purposes, but then when they report to the taxpayer, to the
    public, it is in a different format, and it is difficult to
    reconcile. How do we require that the agencies reconcile that
    difference and give us usable information? Because I do agree
    with my colleagues that sunlight is the best disinfectant. And
    that is the responsibility of this Oversight Committee, to find
    out how much is being spent, where it is being spent, is it
    being spent wisely.
        We had the Director of the Office of Personnel Management
    here earlier this week. He could not tell me the number of
    contractors that we have for the U.S. Government. He thinks it
    is around 10 million. But I can't even find out how many folks
    we actually have out there working for the Government. There is
    a lot of pressure on Federal employees, but here we have these
    10 million contractors, at least, I guess, working for
    different aspects of our Government. It just doesn't seem like
    we have a handle on this at all.
        I applaud your efforts, and I don't mean to single anybody
    out. But we need a lot more work done on this.
        Ms. Miller. Yes, absolutely. And I think the first step to
    that is oversight. Well, perhaps the first step was the
    analysis which the Sunlight Foundation has done in expanding
    that analysis. Sunlight only looked at grants. We have not
    looked at any of the contract information that has been
    reported. So we have no idea of how much that would be.
        Mr. Lynch. Well, get on that, will you? [Laughter.]
        I am kidding.
        Mr. Miller. We have actually requested of the
    administration the necessary documents that we need to do that,
    and they have told us that we could not have that information.
    So we FOIA'd it 6 months ago and we are still waiting. Because
    we would very much like to move into examining the grants, the
    quality of the grants.
        Mr. Lynch. Thanks, Ms. Miller. I do want to give Mr. Smith,
    in fairness, an opportunity to respond. Because I used his
    agency as an example of the filing there, as a glaring example
    of mis-reporting. So Mr. Smith, have a whack at me.
        Mr. Smith. Thank you, Congressman Lynch.
        Let me first say, with transparency comes another set of
    eyes, always another set of eyes. I think it is exceedingly
    important that as people identify those things, if we have an
    anomaly, we identify them, we work through them. I think that
    is the value of transparency. So I think we appreciate the
    outside view and the particular question that you asked and
    that Ms. Miller brought up in her statement on child nutrition
    programs in particular.
        When looking at the legislative intent of the FFATA Act,
    and that individuals would not be reported for awards, the
    school lunch program, and also being below $25,000 for the
    first 3 years of that act, we did not report individual awards.
    We have reassessed that as we have gone along, as questions
    were raised, and at the beginning of this fiscal year, child
    nutrition programs will be reported in there.
        So again, I think it is a matter of, what is being asked,
    how we are reporting it and then how do you track that back to
    the authoritative records. And to the point on audits, we are
    strong believers in audits. Every year we go through a
    financial audit. We also do audits on our financial systems,
    SAS-70, to account for that.
        Mr. Lynch. Thank you. I yield back, Mr. Chairman.
        Mr. Lankford. Thank you very much.
        I recognize the gentleman from Texas, Mr. Farenthold, for 5
    minutes.
        Mr. Farenthold. Good morning, and thank you all for coming
    to visit with us.
        I just have a broad overview question. Do you think part of
    the data problems, and I guess I will direct that to Mr. Smith
    or Dr. Harris, because you work within the agencies, is there
    some level of accountability for the data that you report? What
    procedures do you have in place to check that the stuff you are
    publishing, both on your Web site, and sending to some of these
    collector Web sites, is accurate?
        Mr. Harris. Thank you, Congressman, for the question. At
    the Department of Education, we are actually very proud of the
    quality of the data. I say that because we have a four-way
    match. We do an extract before we submit data to
    USAspending.gov. And we match that against our financial
    system, we match it against the data stream that we send, and
    then we match it against what is actually in USAspending.gov.
        Now, it does go through a treatment when it hits
    USAspending.gov, and that is when we get the opportunity to
    actually make those changes. But I do think at the core, and
    someone spoke about it earlier, I think at the core of data
    quality is having integrated systems such that human beings do
    not touch that data between source and reporting. I think a
    large part of the reporting problem lies there.
        Mr. Smith. Thank you, Mr. Congressman. I would just echo my
    colleague, Dr. Harris' statement, we want to go to the
    authoritative data source. We don't want to reconcile it
    multiple times along the way. So put it in once, read it many
    times and do the reporting. I think the issue we face is there
    are sometimes subsets that we are looking at, when you don't
    have the whole picture, and we are trying to recreate that, is
    where we start to get differences, and when one group is
    looking at one thing and the other.
        But we put a very repeatable, rigorous process in. Any time
    there is a new requirement, we try to go back to that
    authoritative source so we are not reworking it. We check from
    the agency's sub-feeder systems into the core financial system,
    do the edit check there, then we check it at OMB before it goes
    into USAspending.gov. So there are multiple checks in place,
    and then certainly our first standard is high data quality and
    no rework.
        Mr. Farenthold. And I guess Mr. Brito may be the one to ask
    this next question, but if anybody else wants to jump in, feel
    free. When we look at these, and maybe Ms. Miller might kick in
    here, too, when we look at these aggregationsites, are we
    comparing apples to apples? Is there equivalent of generally
    accepted accounting practices for the Government? Or are we
    just getting thrown data as each individual agency sees it, and
    there is no real standard or accountability where we know we
    are looking at accurate data and able to do comparisons that
    are reasonable?
        Mr. Brito. Well, I would defer to the Sunlight Foundation.
    But it is obvious they had to FOIA information to do the
    reconciling.
        Ms. Miller. The answer is, the data is widely dissimilar.
    And so whether the GAO's initial study that they did, or the
    more complete analysis that we did, we are finding all kinds of
    inconsistencies, whether it is consistency of how the data is
    entered, whether it is completeness of the data or the
    timeliness of it, there are lots of problems.
        I have been thinking that USAspending.gov is a relatively
    new phenomenon. It was passed in 2006, I think it was available
    in 2007. So I think the agencies are having trouble adjusting
    to these aggregationsites. But we have to figure this out
    further downstream. I would certainly agree with the notion of
    the less human hands involved in this, the better and the more
    consistent reporting we will have across agencies.
        Mr. Farenthold. And Ms. Miller, let me ask you this. You
    had to Freedom of Information Act these agencies for
    information. Do you have an overall sense that the agencies are
    friendly to publishing this information? Or are you running
    into noes, and agencies saying, we don't really want this
    information out?
        Ms. Miller. Let me clarify. We did not have to do a FOIA
    for any information for the original analysis that we did that
    focused on the quality of the grants reporting to
    USAspending.gov. We have had to create a FOIA to get the FPDS
    data for, in order to do the contract analysis that we wish to
    do.
        Mr. Farenthold. Are the agencies being cooperative, or are
    you running into stonewalls?
        Ms. Miller. We actually don't receive the data from the
    agencies directly. We have not had that kind of interaction. We
    are taking the data from USAspending.gov and comparing it to
    other sources of Government information.
        Mr. Farenthold. Thank you very much. I am out of time.
        Mr. Lankford. Mr. Murphy, 5 minutes.
        Mr. Murphy. Thank you very much, Mr. Chairman.
        Just a few quick questions. Ms. Miller, I am interested in
    your experience with the Department of Defense data in
    particular. This is the one agency that still cannot get a
    clean audit at the Federal Government level. It is obviously
    the largest procurement agency at the Federal level. There is
    an enormous amount of very important data there that I think
    even as Members of Congress, we don't always know whether we
    have proper access to.
        And maybe you don't have an answer to this question, but I
    wanted to know about your experiences with the quality of data
    and the amount of data that comes out of the Department of
    Defense and how relevant that is to individuals that are trying
    to understand the decisions that are being made there, and how
    that money is being spent.
        Ms. Miller. Let me consult with my colleagues just briefly
    to see what their experience has been with respect to DOD data
    on USAspending.gov.
        My colleague, Kaitlin Lee, reports that most of what
    happens at DOD is done through contracting. They do very little
    direct grants. We have only looked at the grants. But if we
    receive this FOIA information that we have requested, we will
    be able to report on that in about 6 months. So I am sorry, we
    don't have that information.
        Mr. Murphy. I bring that up, because as we try to grapple
    with a lot of complex spending questions, I think what Members
    find is that even we don't have access to important data.
    Certainly the public doesn't, and Mr. Brito is nodding his
    head. So I am happy to give you a chance at this question as
    well.
        But as a for instance, when it comes to contracting
    decisions, what we have found is that over the last several
    years there has been a massive outflow of contracts to overseas
    companies. And we get just a shadow of data regarding those
    contracts. We know, for instance, from year to year how many
    waivers to the requirement to purchase here in America are
    granted, but we don't know anything more. We get a report on
    the number of waivers, but we don't know what type of waivers
    they were, why the waivers were granted.
        And so there is a larger conversation from a statutory
    perspective that has to happen about what kind of data the
    public receives from the Department of Defense. But I will be
    very interested to hear the results of your contracting audit
    going forward. Because I think there is a frustration in the
    public, especially with regard to DOD data. And Mr. Brito, you
    are nodding your head, so I am happy to give you a chance at
    that as well.
        Mr. Brito. The only point I would like to make, bringing it
    back to performance data, is that DOD is one of the least
    successful when it comes to performance data. One reason
    perhaps is that they have a quadrennial review process. They
    sort of feel that is the place to do it.
        When we talk about having requirements that an agency head
    certify performance data, the Secretary of Defense for, let's
    see, during the Bush administration, never signed the
    certification. Never did. So that is something that we need to
    focus on.
        Mr. Murphy. And just to switch topics, back to you, Dr.
    Harris, on this issue that was brought up earlier on student
    loans, the total amount in student loans on USAspending.gov is
    somewhere just south of $7 trillion, it is clearly not the
    right number. And I wanted to just before the panel was up, to
    give you a chance to maybe explain why that number appears on
    the Web site, and what happened there.
        Mr. Harris. Thank you, Congressman Murphy, for that
    question. In fact, I was going to jump in when Congressman
    Farenthold raised the issue of aggregation.
        In my investigation, while I certainly agree with the
    assessment by the Sunlight Foundation that there is a
    tremendous amount of work we need to do in improving the
    timeliness and especially the quality of the data, in the
    instance of the $6 trillion loan anomaly, in my investigation,
    I have found that it is more an issue of aggregation. Here is
    what my investigation led to.
        When we report the loan amount to USAspending.gov, the
    instructions tell us to report it at the face value. And in
    fact, every single time we report for that specific loan, we
    report it at the face value. Sometimes it goes up, and
    sometimes it goes down, based on activity against that loan.
        But if you aggregate that, unlike other data elements that
    you can aggregate and they give you an accurate amount, if you
    aggregate that amount over time, you are going to come up with
    a ridiculous number. But this is where context becomes the
    biggest issue we have with Open Government reporting. We have
    to do a significantly better job at informing the public on not
    what just the dataset means, what the data attribute means.
        So we believe it is the aggregation that was incorrect.
    When I look at the data on USAspending.gov, it is accurate for
    the Department of Education.
        Mr. Lankford. Thank you.
        Mr. Walberg, 5 minutes, please.
        Mr. Walberg. Thank you, Mr. Chairman. And thank you to the
    panel for being here.
        I want to followup on Mr. Farenthold's questioning of Ms.
    Miller. I listened to that question, but I want to move to Dr.
    Harris and Mr. Smith with this question. Has the Obama
    administration been helpful in assisting your Department in
    creating your Open Government plan, and your efforts to meet
    the Open Government directive? And I would ask you both, maybe
    we can start with Dr. Harris.
        Mr. Harris. Absolutely. I think the No. 1 help, if you
    will, would be in the way of a challenge. And we look at the
    Department of Education, we look at Open Government in two
    ways. Probably a slightly unconventional way. One is certainly
    providing data to the general public in a way where they can
    take the data and do what they need to do with it.
        But the other piece that we push hard on is collaboration.
    And when you initially hear the word collaboration, you are
    thinking of the public collaborating with the Government. But
    when you look at our Race to the Top program, and you look at
    our innovation program, we are actually providing data to the
    public that they can collaborate with each other. This is where
    we feel true innovation in education comes from, not just
    interacting with the Federal Government.
        So the Obama administration has helped us with that kind of
    out of the box thinking.
        Mr. Walberg. Mr. Smith.
        Mr. Smith. Thank you, Mr. Congressman. Yes, I think it was
    a very collaborative effort, as Dr. Harris has said. The
    Secretary asked me to serve on a working group that the White
    House convened, and I think every agency was asked to do that.
    And we worked through, and I think a testament to that is Ms.
    Miller and other groups, such as OMB Watch, being invited also
    to comment as we developed these plans, to make sure that we
    had a full and open conversation as each agency developed their
    plans and we shared those plans across the Federal Government
    and sought to put out the best product. Then we iterated those
    as we went forward.
        I think one of the most important things is that as we are
    looking at transparency, collaboration and participation, how
    does that drive the mission forward? What is the economic
    impact? If we are putting data out there, what is the ability
    for citizens to take that and have an economic impact for us in
    those rural areas? Or if it is food safety, how do we push the
    Nation forward by being more open, transparent and accountable?
        Mr. Walberg. Very important, with both entities, to have
    that transparency. And the administration as well.
        Let me continue the questioning with the two gentlemen.
    Under OMB's directive, each agency selected a ``high level''
    official to oversee the Open Government initiatives. How did
    your agency select its high level official, and what
    considerations did you undergo in the selection process?
        Mr. Harris. At the Department of Education, we certainly
    did not see the issue as a technology issue. It was more of a
    business processing issue. I am currently the senior
    accountable official for data quality at the Department of
    Education. I wore, for many years at the Department of
    Education, the chief financial officer hat. But I am a
    technologist.
        But what is more important is, as the official, I bring
    together individuals, subject matter experts from the program
    offices, subject matter experts from finance, and subject
    matter experts from technology to make sure that we get it
    right. So that is kind of how we did it.
        Mr. Walberg. Mr. Smith.
        Mr. Smith. Sir, the Secretary asked me to take the lead.
    But it was very clear that I myself was not going to get this
    done. So we had a team-based approach. We built a rigorous
    governance structure around it. It was myself and the Deputy
    Under Secretary for Natural Resources and Environment. And we
    actually have a meeting standing, executive steering committee
    made up of under secretaries, deputy under secretaries, across
    all the mission areas, to ensure that we continue on this
    effort and make steady progress.
        Mr. Walberg. Thank you. I yield back my time.
        Mr. Lankford. Thank you.
        I am yielding myself 5 minutes here. And I think we are
    approaching a time for a vote, just to give you a heads-up. It
    should hit about the time we hit the break in between. But I
    have several questions I want to be able to talk through with
    Dr. Harris and Mr. Smith, especially. How do you choose the
    datasets? From what I am seeing, what is coming out, there was
    a requirement to get at least three high value data sets. How
    are those chosen? What was the process you went through? If you
    could be brief, I have a ton of questions.
        Mr. Harris. Sure. As you are well aware, Mr. Chairman, we
    have a very, very visible Secretary in Arnie Duncan. Mr. Duncan
    spends a tremendous amount of time on the road, and he is
    constantly asking the citizens what information do you want.
    Much of our information flows down from senior leadership in
    that way. And that is kind of how we decided.
        Mr. Lankford. I will come right back to that. Go ahead, Mr.
    Smith.
        Mr. Smith. I think I just alluded to it, we try to apply a
    lens to all our datasets that said how are we pushing the
    economy forward, what is the value of these datasets from
    safety and security of the food supply, and every mission area
    increasing exports. How can we put information out there that
    furthers the goals of the Nation as we move forward.
        Mr. Lankford. Would that be for Data.gov or
    USAspending.gov, or would that be the same for both of those?
        Mr. Smith. We applied this to any data, any information
    asset within our mission areas.
        Mr. Lankford. When you are choosing, as far as priority of
    where to put things, obviously your agency has a very good Web
    site, for both your agencies, and the information that is out
    there. When you are choosing information, where does it land?
    The agency Web site, Data.gov, USAspending.gov, all of the
    above? There are multiple other portals that are out there as
    well.
        Mr. Harris. Actually, all of the above. In fact, prior to
    USAspending.gov, Data.gov provided 20 toolsets and datasets out
    there for our customers and clients to use. We actually looked
    at how that data was being used and asked the question, what
    part of this data do you like, what don't you like.
        Mr. Smith. Yes, we apply it, again, to the whole portfolio.
    Let me give you a quick example, the farmer's markets. We
    expose the information on where all the farmer's markets are in
    the Nation. We have seen maps produced, so we are having an
    impact on small business and farmers to sell fresh produce
    throughout the country, and hope that increases traffic to
    those markets.
        Mr. Lankford. I spend time, obviously, going through a lot
    of the things that are out there as far as information and try
    to get a good handle on it. But one of the interesting things,
    I am sure you have done the same thing on it, when I go to
    Data.gov and I input agriculture, or I go through the search
    features, and there are multiple different vehicles for that,
    or education, on that, when I go to Data.gov and ask for just
    raw data on it for education, it comes up with nine datasets
    that come up for education. And for agriculture, it comes up
    with 20 total. And the 20 that are out there, the farmer's
    market one you just illustrated, all of them are from previous
    years. They are older data on that.
        So just trying to process through, obviously there are
    multiple places I think it is located. It is just having
    Data.gov, the goal of it was to have a place where you type it
    in, it all comes up there. And it is actually not coming up
    there when you start doing a search on it.
        Mr. Smith. I will certainly go back and take a look at
    that. The point is to have a kind of a one stop shop for
    information portals. So we will certainly look at that.
        Some of the datasets were existing, but there were others
    that had not been exposed through that manner. One is USDA
    nutritional data base, and that is one I talked about, in which
    people are now making mobile applications in order to reduce
    obesity and increase the health of our constituents.
        Mr. Lankford. Sure.
        Mr. Harris. Mr. Chairman, I think you are actually
    highlighting the very important issue of context. For example,
    when you look at the CFDA data base, and you look at
    USAspending.gov, the average citizen would expect to see the
    exact same number in both places.
        Mr. Lankford. Correct.
        Mr. Harris. But in fact, the reporting is done at different
    periods of time. Are we doing a good enough job in explaining
    to the average citizen the period of time, the context of the
    data, the answer is no, we need to do a better job.
        Mr. Lankford. I think what we have created, it is the
    energy that the Obama administration has put out, saying, let's
    get this out there. But now we have created so many different
    sites, dot gov, that are out there, no one really knows where
    to go to get it. And we don't have a single portal to say, go
    here, and it will link to everything else. We are missing that.
    So that is a big piece I think we have to be able to resolve on
    this, just getting the basics of where it goes from there.
        As far as searchable pieces, and this is another thing from
    USAspending.gov, one of the things I found often when I go
    through it, USDA had a piece of it, there is an Excel file that
    would come up, multiple different versions of it, but it would
    have the address, for instance, all in one file. So when I
    wanted to search for Oklahoma, and say, what are all the
    different grants that are out there for Oklahoma, it is not
    possible to do. Because if I just type in OK as a search, I get
    every look, crook and hook coming up as well in my search. And
    so just the basics of breaking up the fields becomes very
    important.
        What data standards do you put out there to say, this is
    how every single data base is going to be put out to make it
    consistent and searchable?
        Mr. Smith. I think you are pointing to one of the
    challenges many of us face in large Cabinet level agencies, or
    any large organization, corporate or public. There are multiple
    systems brought up over time, and many of them in non-standard
    manner. So it is a very large lift to go back and standardize
    in each and every area. So we are very focused on that, in
    particular, the areas we are focused on right now are
    transparency and the reporting areas you have talked about. We
    have been able to take the existing data, put it into a
    readable format and get it out there.
        When you throw that net even more largely, there are
    challenges out there, and we consistently strive to work on
    those. A good example of what we are doing in the Department of
    Agriculture is farmers report acreage, are reporting multiple
    different ways across multiple programs. So we have set out to
    use the national information exchange model as the standard,
    not only that the farmer uses, but agribusiness and Government,
    so that everybody can report and share information in the same
    manner.
        Mr. Lankford. Right. I would assume every different one of
    those groups, as well as every grant that is out there, has a
    unique i.d. that it is using. It is difficult to even track, is
    this the same vendor as this, they might have a similar name
    and they might have a little difference on it. Is there a way
    to be able to set it up and say, this is the unique i.d., so if
    we are searching, no matter if they have a subset underneath
    that general agency, we can still track it and say, all of
    those that have this name, they are all here and we can search
    all of them? Is that possible to be able to do?
        Mr. Smith. The CCR, and Don's effort, looked to get one
    master vendor data file in which that solves the issue of
    contractors and who we are working with. And I think we have
    made great strides on that front. But it remains an issue that
    we are working on constantly, to keep that data clean.
        Mr. Harris. Certainly this is pointed out, I believe, in
    the Sunlight Foundation's report, something that we have known
    for many years, that an entity could have multiple DUNS
    numbers. And oftentimes, if they are not linked properly, and
    you are making decisions based on aggregate data, you are not
    making good decisions. So a lot of work needs to be done in a
    unique identifier.
        Mr. Lankford. Give me your timing on that. Give me your
    thinking as far as work to be done. I know this has been going
    on for a while. How does that get resolved, and what kind of
    time period is needed to resolve that? I hate to say it this
    way, is that up the food chain from you? Someone from OMB is
    going to have to be able to handle some of those things, or is
    that something that is within the agency?
        Mr. Harris. I believe it is up the food chain, but I
    believe it is also a partnership with the public. Because they
    are the ones who have to do business with the Federal
    Government, they are the ones who actually have to get these
    identifiers. And they have to concur that one identifier for
    the entity makes sense, and that they are willing to do it.
        But to answer your question, how far away is that, I don't
    believe we have even started in really aggressively attacking
    that issue.
        Mr. Lankford. Thankfully, we have someone from OMB who is
    going to be hanging out in the next panel, and we will get a
    chance to ask that question in a moment.
        Let me just see if there are other Members. My time has
    expired, but I want to thank you very much for coming. We will
    have a panel that will be following. If you would like to stay
    around, we have votes that are going to be happening
    momentarily. You would be able to hear Mr. Werfel's comments,
    or you may leave, as well. Thank you very much for being here.
    If we have additional followup questions, we will try to
    contact you directly.
        With that, this panel is concluded.
        Mr. Werfel, if you could come to the dais here, and we
    could have a quick chat.
        [Pause.]
        Mr. Lankford. In the interest of time, I am going to go
    ahead and swear Mr. Werfel in in just a moment, and restart
    this second panel, and allow him to do his opening statement.
    We will watch time on votes and see what happens. You are
    welcome to sit in and be a part of this as well. We will get
    started in just a moment.
        [Recess.]
        Mr. Lankford. The second panel for this subcommittee will
    begin again now. We are going to recognize this panel. Mr.
    Danny Werfel, he is the Controller of the Office of Federal
    Financial Management, OFFM, within the Office of Management and
    Budget. He is responsible for coordinating OMB's efforts to
    initiate Government-wide improvements in all areas of financial
    management, which I would assume would be a very large,
    complicated task.
        So thank you for being here. Pursuant to all committee
    rules, all witnesses are sworn in before they testify. If you
    would please rise and raise your right hand.
        [Witness sworn.]
        Mr. Lankford. Thank you very much. You may be seated. Let
    the record reflect the witness answered in the affirmative.
        Mr. Werfel, I am going to allow you to do your opening
    statement as well, then we will watch carefully for the vote
    time. Hopefully we will be able to get questions and your
    statement in all at once, and we will just see how time moves
    from there. Thank you.

    STATEMENT OF DANIEL I. WERFEL, CONTROLLER, OFFICE OF MANAGEMENT
                               AND BUDGET

        Mr. Werfel. Thank you, Chairman Lankford, Ranking Member
    Connolly and members of the subcommittee, for the invitation to
    discuss our progress in creating a more open Government.
        On his first day in office, President Obama signed a
    memorandum on transparency and open Government that set forth a
    new paradigm for an open and accountable government. Since
    then, the administration has been unwavering in its commitment
    to increase transparency, participation and collaboration to
    make our Government more open, accountable, and efficient.
        A lot has happened over the last 2 years. The
    administration launched the Accountable Government initiative,
    which outlines a performance management approach that drives
    agencies' top priorities, cuts waste, reforms contracting,
    closes the information technology gap, promotes accountability
    and innovation through open government, and continues our
    efforts to attract and motivate top talent to the Federal
    Government.
        Federal agencies are becoming more open, publishing
    detailed Open Government plans and road maps in compliance with
    our Open Government directive. Final agency plans feature key
    openness initiatives, the identification of data the public
    would consider highly valuable, and new agency Open Government
    Web pages to facilitate greater transparency.
        The Federal Government's data has become the public's data.
    Data.gov is a Federal one stop data sharing platform designed
    to democratize access to data with hundreds of thousands of
    datasets in a common format housed in a central location.
    Federal spending clearly is becoming more transparent.
        We launched paymentaccuracy.gov in June 2010. This contains
    information about current and historical rates and amounts of
    improper payments, information on why improper payments occur,
    and information about what agencies are doing to reduce and
    recover improper payments.
        Recovery.gov presents unprecedented levels of transparency
    and accountability, so that citizens can monitor the progress
    of the Recovery Act, to track Federal contracts, grants and
    loans, to an unprecedented degree, and to provide feedback on
    the status and results of those investments at the community
    level.
        USAspending.gov is a one stop site that provides the public
    with an understanding of how Federal dollars are spent,
    accounting for billions of dollars spent across the executive
    branch agency. The site not only contains valuable information
    on Federal spending, but has been recently expanded to include
    data on sub-awards. The public can now see where Federal grant
    and contract dollars go down to the sub-grantee and sub-
    contractor levels.
        Providing easy access to information is critical to ensure
    that the Government is held accountable for how it uses
    taxpayer dollars. While much progress has been made, going
    forward we need to continue our efforts to fulfill the
    President's State of the Union promise, to build people's faith
    in the institution of government. We need to continue to refine
    the collection of data, provide easy access to information,
    collaborate with our stakeholders and encourage participation
    in how we conduct business.
        The administration's commitment to open government is firm.
    The mechanisms that have been and continue to be implemented
    constitute a new way of doing business that will persist for
    decades to come.
        While we have accomplished many things, there is still much
    work, as I have mentioned. The public cannot realize the full
    utility of transparent Federal information if the data across
    our agencies are incompatible. Demonstrating our commitment to
    quality assurance, we have already identified potential methods
    for data standardization, particularly within Federal spending
    information. Data standardization will not only increase the
    usability of the information for the public, but will also
    achieve long-term benefits across Federal agencies.
        Current efforts to provide quality and real-time data to
    the public can consume many resources, and at times, manual
    process to ensure the data from multiple systems and sources
    reconcile. To sustain and improve upon these efforts, inter-
    agency work groups have been launched, with the commitment to
    drive high quality Federal spending information and reevaluate
    and realign the underlying data standards.
        As we continue to buildupon the solid foundations of an
    open government, we must constantly gauge our progress against
    the guiding principles of transparency, participation and
    collaboration. We embrace the opportunities to work with all of
    our stakeholders to reach the shared end goal of an open
    government.
        Thank you for the opportunity to testify today, and I look
    forward to answering your questions.
        [The prepared statement of Mr. Werfel follows:]

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        [GRAPHIC] [TIFF OMITTED] T7567.039

        Mr. Lankford. Thank you very much.
        I am moving to recognizing Mr. Kelly, the vice chairman, to
    begin our questioning time.
        Mr. Kelly. Thanks, Mr. Chairman.
        Mr. Werfel, both President Obama and the OMB have stressed
    the importance of government that is transparent, participatory
    and collaborative. How is OMB enacting this guidance, and what
    role does OMB believe public citizens have in the process?
        Mr. Werfel. The public citizens have a central role. I
    think one of the tenets of open government is that
    accountability is necessary to push the types of results and
    improve government performance that citizens demand, and that
    we have a responsibility to reach.
        What we see day in and day out is that the more information
    is shared publicly about Federal activities, in particular, for
    example, where our Federal dollars are going, the more not only
    do citizens participate and engage in helping keep us
    accountable for those dollars, but the Government agencies
    themselves feel more accountable. As was mentioned in the
    previous panel, sunlight is a great disinfectant. We certainly
    see that happening throughout Government. I think the Recovery
    Act, in particular, is a great example of that.
        Mr. Kelly. OK, and I appreciate that. But my question is,
    if we are really looking for transparency and we are looking
    for participation and collaboration, why weren't you willing to
    go ahead and appear with the rest of the panel today?
        Mr. Werfel. For the record, Congressman, I would state that
    I am here now, answering your questions and can be----
        Mr. Kelly. That wasn't my question, and I understand what
    you are saying. But we keep talking about, we want
    transparency, we want people to have access to us. And then
    when we have an opportunity to appear on a panel with other
    folks, you decline that. Makes no sense to me.
        But I come from the private world. I don't come from this
    world. I really am trying to understand why we talk one way and
    we act an entirely different way.
        Mr. Werfel. I think the elements of the administration's
    policy in terms of witnesses and how they appear is something
    that I am happy to spend more time with you on, and get more
    information for you. Again, I will repeat, the bottom line is I
    am here and ready to answer any questions you have.
        Mr. Kelly. And I recognize the fact that you are here. But
    I really do, in the world I come from, I absolutely hate tap
    dancing. When I can't get an answer, and you do not have to be
    diplomatic with me, you can be direct, and I would hope you
    understand, I am that same type of person.
        So whenever we have an administration that says, we want to
    be open, we want to work with you, we want you to know
    everything, and then we invite them to sit here with us in the
    panel, with the public, and they don't show up, and the answer
    is, I will get back with you, I don't think that is fair to the
    American people. I think it does a disservice, and it certainly
    discredits a policy that is supposed to be open and
    transparent.
        I yield back my time, Mr. Chairman. I don't think you can
    answer that, right? Or we are going to go back on what you did
    say?
        Mr. Werfel. My direct answer to you is, you have requested
    is that I am not the correct OMB official to answer the
    question on the administration's policies with respect to
    witnesses testifying before Congress. Therefore, I have to go
    back and get the answer to your question.
        Mr. Kelly. Bad policy leads to bad process leads to a bad
    image of what the people in this country really expect of us,
    and they really do expect us to say what we mean and mean what
    we say. That is just a real basic definition of integrity. And
    I would suggest to you that in this town, we had better start
    understanding what it is the American people expect from us.
    And they do not expect to be given the runaround on things.
        So I appreciate the fact that you are here, and the fact
    that you can't answer. But I would appreciate, in writing, the
    answers to why you could not appear with the other panel.
        Thank you, and I yield back my time, Mr. Chairman.
        Mr. Lankford. Thank you, Mr. Kelly.
        I hate to tell everyone this, because it is going to cause
    a significant delay, but we have votes that have already been
    called on the floor of the House. We have also been asked by
    the people that we represent to vote for them. So we are
    expected to be there as well.
        We are going to recess temporarily. This hearing will
    resume in probably about 40 to 45 minutes. We will resume again
    with the questioning and then be able to address our questions.
        With that, we will stand in recess.
        [Recess.]
        Chairman Issa [presiding]. The hearing will come to order.
        The subcommittee chairman will be here in a moment. But one
    of the few great prerogatives of the Chair is I also have the
    ability to bring it back to order.
        Thank you for staying over the voting break. You will see
    Members straggling back shortly.
        I have a short series of questions for you. And they really
    have to do with the work that the RAT board has been doing. As
    far as we can tell, and both myself, the former chairman and
    the current ranking member, have all gone over, reviewed it,
    seen some of the discoveries. But particularly seen what we see
    is the first time in which there has been a direct outreach to
    get reporting, to get it in a format that is consistent and
    usable, and then use it against other data bases that detect
    fraud, at the current time, OMB, from what we can tell, has no
    comprehensive plan to bring a similar recipient reporting
    system across the Government. Can you comment on that?
        Mr. Werfel. Yes. First of all, I would say that we are
    completely committed to carrying forward some of the important
    accomplishments that the Recovery Board has had. One of the
    major areas where they have been successful, as you have noted,
    is the deployment of a forensic data tool and a fraud detection
    tool. It is for that reason that the President's budget
    includes a proposal to move into the Department of Treasury----
        Chairman Issa. You are talking about the $10 million?
        Mr. Werfel. The $10 million for the do not pay solution,
    which would adopt very similar approaches that the Recovery
    Board has adopted in terms of having a central place where the
    Treasury Department, in this case, would be assisting agencies
    and looking across all data sources where we can get access to,
    both public and----
        Chairman Issa. That is where I want to stop you.
        Mr. Werfel. Please.
        Chairman Issa. The President, by executive order, could
    require all the agencies, I have been told, at least, to
    cooperate in a way in which the reporting would be assumed, and
    thus that $10 million investment would be able to guarantee
    that it would have access subject to data integrity and ability
    to transmit it to do the kind of work the RAT board has done.
    As you know, the RAT board leveraged basically Katrina-Rita
    data. They leveraged existing one-time events in order to get
    more access.
        They have been unable, except anecdotally, by transfers
    that they have been able to get, they have been unable to get
    the real access that would allow cross-platform. And Treasury
    certainly would have the authority and the confidence.
        Are you prepared to, either legislatively or through
    executive action, get that kind of buy-in? Or will it be, with
    all due respect, the old mealy mouthed, we are OMB, we do
    things collegially, we get buy-in, which is crap, it never
    works. And if you say it does, I will have Mitch Daniels
    sitting in your seat, explaining that it doesn't work by Sunday
    morning.
        That is my question to you, because your teeth are not
    sharp enough to cut through the bureaucracy. Are you asking for
    something that would give either you and/or in this case
    Treasury the teeth to make this a reality?
        Mr. Werfel. I think the answer to that is yes. We have to
    balance, as we break down data silos that exist in Government
    today, and create the, enable us to do the type of analytics
    that are going to drive more powerful assessments around
    finding anomalies, fraud and error, there will be other public
    policy balances that need to come into place, including, for
    example, privacy and other implications and data security. It
    is my position that we can achieve a far greater efficiency and
    streamlining of data share and date interoperability across
    Federal agencies, while still meeting important privacy and
    security objectives.
        Chairman Issa. What data does the Federal Government have
    which you are prohibited from accessing for purposes of
    analysis?
        Mr. Werfel. For purposes of, well, there are, for example,
    one of the more protected data bases is the IRS data base, as
    an example. And to the extent there is personally identifiable
    information or tax information, Section 6103 of the Code would
    prevent that type of movement of data.
        Another great example is the National Directory of New
    Hires.
        Chairman Issa. Right, but let's go through, because the IRS
    is the best known by the American people. The IRS routinely
    takes information in, digests it and responds to State laws,
    Federal and State laws. If you have a deadbeat dad in Minnesota
    who leaves and goes to Florida, or any other State, the
    Minnesota input data leads to an output data that confirms the
    availability of the dollars, allows for the grabbing of the tax
    return and thus the movement of it, either to public entities
    that have taken care of the mother and child, or directly to
    the individual, or for that matter, even to a State coffer on a
    State tax.
        So if you have that authority within the Code, can't you,
    without looking at it, create a leverage where you send the
    data in a format the IRS can absorb, with your request, and you
    get back only the limited response? Isn't it true that you
    can't even pierce the IRS, as long as you don't extract the
    data?
        Mr. Werfel. Yes. There are, I am personally aware of
    situations in which IRS data transfers can occur in a different
    format, in order to protect certain 6103 restrictions. So you
    are right about that.
        Chairman Issa. OK, my time is expired. When you said yes,
    you are prepared to do it----
        Mr. Lankford [presiding]. I can yield to the gentleman an
    additional 2 minutes.
        Chairman Issa. I thank the gentleman, but I will hopefully
    not use it all. You didn't say that you would ask the President
    by executive order. You apparently historically do not have the
    legislative authority. Are you going to come to us for
    legislative authority, and if so, when?
        Mr. Werfel. I think, let me step back and say that there
    are different avenues we can dig to break down these data
    silos. In some case administrative, and in some case, we would
    need legislation. I believe we are in a, as we move forward on
    our efforts to detect fraud and understand more what we need to
    do to knock down these data silos, I think we will be back and
    asking you for help, legislative help to create these types of
    data transfers.
        I don't have a date certain by which I know we will come
    back. But it is our commitment to work with this committee in
    particular on these issues.
        Chairman Issa. OK. My closing question, which I would
    appreciate just answered for the record, or briefly respond and
    then expand, forensics clearly are not going to be enough
    alone. If I were Visa, MasterCard or any of the other, if you
    will, world class organizations, real-time, online assessment
    is how you prevent the loss, not how you simply see if the
    courts are too backed up to go after the person once you find
    them. Ten million is obviously not for that.
        Do you have a plan to make any portion of the Government as
    proactive as Visa, MasterCard?
        Mr. Werfel. I don't know that I could articulate for you an
    overarching plan. I will say that I agree with the principle
    that prevention comes first versus paying and chasing errors
    after they occur. Absolutely. There are situations that are
    emerging today where agencies are taking more aggressive steps
    to pause, to review, to place moratoriums on certain payments
    before they go out the door. That is part of the prevention.
        But a global, cross-Government plan that initiates the type
    of neural networks that you are talking about, we don't have
    that in place yet. I think if we get to a point where we start
    to knock down some of these data silos, that will open the
    door. We need to bring some smart people around the table to
    figure out how to enable such, leveraging such a new data
    environment.
        Chairman Issa. Thank you.
        Thank you, Chairman. I yield back.
        Mr. Lankford. Thank you. I would like to recognize the
    ranking member, Mr. Cummings, for 5 minutes.
        Mr. Cummings. Thank you very much.
        Mr. Werfel, let me ask you this. In the other panel, Ellen
    Miller talked about some agencies that were not reporting. Were
    you here?
        Mr. Werfel. I was.
        Mr. Cummings. Can you talk about that for a moment? And I
    was just wondering what we are doing to try to make sure that
    they do report.
        Mr. Werfel. Thank you for the opportunity to respond to
    those issues.
        First of all, I think it is a very important thing that the
    Sunlight Foundation is doing by raising these issues to our
    attention. It is part of transparency at work. We don't just
    self-identify errors, we rely on the public to be reviewing our
    reports and finding those issues as well.
        I think in some cases, we are going to find that the public
    is going to report, like a group like Sunlight Foundation, an
    error, and it is going to have a real, immediate impact and be
    a legitimate issue for us to address. And sometimes, the error
    has an easy explanation and it is not really an error at all. I
    think there was an example that was provided around the school
    lunch program, where USAspending.gov doesn't require us to
    report payments under $25,000, which is the bulk of the school
    lunch payments. That is why there is an absence of information.
        All that said, there are criticisms that were discussed in
    the first panel that are valid. And we are not where we need to
    be in terms of the full completeness of the data. We have
    issued a policy at OMB that we think is having an impact on
    this, that requires Federal agencies to initiate more robust
    quality assurance programs around the completeness, accuracy
    and timeliness of their data, starting with the senior
    accountable official and moving forward to the types of
    frameworks we see in our traditional financial statement
    reporting process: risk management, internal control review,
    reconciliation of information in our accounting systems to what
    is being reported on USAspending.gov.
        All of that is underway. But Congressman, it is an evolving
    process. As we move forward, there will continue to be points
    in time which we expect there will be some errors. And we will
    get better and better at this as we go.
        Mr. Cummings. I often say that there are certain things
    that are a project and not a product. Certain things are ever-
    evolving.
        The question is, are we doing, are we moving fast enough?
    We just heard from the Commissioner of the SEC yesterday, and
    in one of her reports she talked about how folks on Wall Street
    were moving so fast and coming up with all kinds of new
    products. In some instances, so fast it was hard for SEC to
    keep up with them.
        I am just wondering, do we have, first of all, the
    technology that we need? Is it, from what you can see, problems
    stemming from folks who are just not doing what they are
    supposed to do? Is there a bigger hammer that needs to be
    hammered? I am just wondering.
        Mr. Werfel. I think it is a mixture. I would say that there
    are moments that I see, in my work, where it is almost
    astonishing, the progress that is being made. So for example, I
    look at Recovery.gov today as an example. The information that
    is there, the level of detail, the functionality of that Web
    site. And I think that is really a cutting edge tool that is
    probably far ahead of where I thought we might be 5 years ago,
    if I was testifying before you then.
        And so that is exciting. And that, I think, rallies the
    rest of the community around what is possible. And really opens
    the door to even greater efforts.
        At the same time, there are agencies that I could probably
    say I would have thought would have been further along if I was
    testifying here 5 years ago.
        To answer your question, I think a bigger hammer is needed.
    I think what you have today is a dichotomy that was reported on
    the first panel that is accurate. We have what I would argue is
    a very robust financial statement audit process that exists
    today. Started in 1990, it has been 20 years. We have 20 of the
    24 major agencies in Government receiving a clean audit
    opinion. A lot of effort goes into scrutinizing, to the 10th
    decimal point, the numbers that go on our balance sheets and
    our other basic financial statements. And we have developed a
    very robust process in response that is moving forward and
    achieving important things in terms of financial reporting
    reliability.
        That robustness does not exist with respect to the
    information as reported on USAspending.gov. The spend
    information, as we call it, is not completely wired into the
    financial statement audit process. We think that we need to
    look at that audit process and that reporting model to
    potentially realign some of that audit scrutiny around spending
    information. I think you would see a difference in results if
    agencies felt the accountability of an auditor's eye on these
    issues.
        Mr. Cummings. I ask for unanimous consent that I have an
    additional 3 minutes, as the chairman had.
        Mr. Lankford. Absolutely.
        Mr. Cummings. Thank you very much.
        In your testimony, you also talk about the breadth and
    depth of reporting required by the Recovery Act, 200,000 prime
    and sub-recipients file public quarterly reports, with up to 99
    distinct data fields. As you point out, this is more frequent
    than other major financial reporting required by the Federal
    Government. And yet, Recovery.gov seems to be the best example
    of Federal spending transparency. Indeed, 99.6 percent of prime
    recipients filed on time last quarter.
        So I have to ask you this. Where did Recovery.gov succeed
    and USAspending.gov struggle, and why?
        Mr. Werfel. That is a very good question. I think for one,
    the Recovery Act represented a point in time where there was
    tremendous accountability, both vertically and horizontally,
    across Government and recipients, about getting the information
    reported in and getting it correct. There was leadership
    engagement, congressional oversight, GAO has probably issued 20
    reports auditing and looking at our activities to meet these
    requirements. There was a real sense, and I am glad of it, a
    real healthy stress that was placed on the entire Federal
    environment, and the recipients of the Recovery Act, that this
    needed to be done transparently. And it became one of the most
    major priorities that I have ever been involved in in order to
    make this work, make it successful.
        And we had a very talented individual in Earl DeVaney at
    the board, at the Recovery Board, helping us along the way. And
    the stars aligned for great success. The USAspending.gov
    environment, it hasn't been as similar. The law was passed in
    2006. We did not see the same type of emphasis, whether it be
    GAO, congressional or administration leadership, around getting
    those data requirements up and running.
        When this administration came in, it was confronted almost
    immediately with the economic situation and the Recovery Act.
    We immediately looked at this as a major opportunity to deploy
    Recovery Act reporting and Recovery.gov successfully, and have
    it set the milestone that USAspending.gov would need to follow.
        We already see evidence that is following through. Because
    up until the Recovery act, we never had any sub-award reporting
    in USAspending.gov and now we do. So we are already starting to
    see that this arc of, can Recovery Act reporting set a new tone
    and a new watermark that would move USAspending.gov in the
    right direction, it is already starting to materialize. But we
    still have to work at it.
        Mr. Cummings. Thank you very much, Mr. Chairman.
        Mr. Lankford. Thank you.
        I would like to recognize the ranking member of this
    subcommittee, Mr. Connolly, for his questions in 5 minutes.
        Mr. Connolly. I thank the chairman, and welcome Mr. Werfel.
    Welcome back to the Oversight and Government Reform Committee,
    your second home lately.
        Mr. Werfel. Yes.
        Mr. Connolly. We are glad to have you.
        You, I don't think, had joined us yet, but the chairman,
    Mr. Lankford and I, in our respective opening statements, both
    praised the administration for the transparency initiative,
    especially with respect to Recovery.gov. So I think there was
    public acknowledgment, on a bipartisan basis, that we have made
    a lot of progress. Now, nothing is perfect.
        You in your testimony talked about the OMB and the CFO
    counsel developing a new statement of spending to focus on how
    and where Federal dollars are being spent. Would that supplant
    the current CFS? And how would that work?
        Mr. Werfel. It wouldn't supplant it. It gets back to part
    of the response to Congressman Cummings' question, how do you,
    we have confronted ourselves the following question. How do we
    drive more accountability for Federal agencies' reporting of
    spending information into USAspending.gov. We feel like we have
    developed a pretty strong muscle in the area of basic financial
    statement reporting. The agencies have been doing it for years.
    They have set up IT systems and processes to do it.
        So the question is, how do we walk in that game and talk in
    that dialog. That is where the concept of the statement of
    spending came. Because agencies have the ability and the
    experience, and auditors have the ability and experience, to
    audit basic financial statements. We felt that if we can create
    a financial statement similar to our other statements that has
    the foundational information that goes into USAspending.gov
    that you, in order to get a clean audit opinion on that
    statement of spend, it would automatically mean that the
    underlying source information is accurate and then the
    information that flowed into USAspending.gov by definition
    therefore would be more reliable.
        So what we are saying with the statement of spend is,
    reliability of USAspending.gov information into what we believe
    has been a successful, yet still emerging initiative to improve
    basic financial reporting on things like balance sheets.
        Mr. Connolly. Are there best practices from USAspending.gov
    that can be applied to other Federal agencies, and if so, how
    does OMB disseminate that, or inculcate that?
        Mr. Werfel. Absolutely. One of the things that we did when
    we started this process of moving forward on a more robust
    quality assurance program from USAspending.gov is we asked each
    agency to submit a data quality plan. And you can look across
    those plans and see some agencies really ahead of the game in
    terms of the types of reconciliations that they are doing,
    looking at control totals, doing automated reports right out of
    their systems. I think Danny Harris, Dr. Harris did a very good
    job during his testimony of explaining how much they have
    leveraged their transaction infrastructure in a way to make
    this make more sense.
        But other agencies, not as much. Other agencies are still
    doing more manual, what we sometimes call cuff reports, putting
    together the reports separately and therefore, it is not as
    efficient and it is not as reliable. So one of the basic
    missions of my office, the CFO Counsel, is to share this
    information across agencies. We have working groups that are
    doing that to say, here is what Dr. Harris and the Department
    of Education are doing. They have it wired into a process that
    is working for them and minimizing errors. And your agency is
    not doing as well of a job. So how can we close that gap? So
    that is part of the mission here.
        Mr. Connolly. Let me ask you, because I am going to run out
    of time, one more question. In the category of transparency, at
    least speaking to this Member, I don't think we pay enough
    attention up here to tax expenditures. That is a real, live
    spending item by any other name. We just don't like to talk
    about it, but it is a trillion dollars a year.
        What is OMB doing to try to make sure that we are shedding
    more light on tax expenditures and their relationship to the
    Federal deficit and their relationship to other aspects of
    Federal spending?
        Mr. Werfel. This is an issue that I think, it is going to
    be one of those times in the hearing when I ask to come back to
    you with more information. I would like to consult with my
    colleagues at IRS. It is not currently one of the required
    elements, for example, within Recovery Act reporting and
    USAspending.gov. So sometimes we are so busy dealing with the
    statutory requirements that are before us and meeting all those
    deadlines that some of the other elements of transparency don't
    get on our radar screen as much.
        For me, that is true. My days and nights are spent meeting
    the requirements of the various laws before me. So let me, if I
    could, consult with IRS and then come back and brief your
    subcommittee on this issue.
        Mr. Lankford. I yield to the gentleman an additional 3
    minutes of time.
        Mr. Connolly. I thank the chairman. And I really welcome
    that, and Mr. Chairman, I would hope that our subcommittee
    would welcome that. Because I think if we are going to have
    transparency and we are going to have data available to the
    public, tax expenditures, if you look at how they are accounted
    and how we address them in budget documents and so forth, it is
    woefully inadequate. And it is a very substantial amount of
    opportunity cost from a revenue point of view. It may be all
    good policy, but it deserves the light of day.
        So I would welcome your coming back to us in much more
    detail.
        And let me ask, and I would hope that the chairman would
    join me in this, that we would ask also for your
    recommendations about how better to capture both the value and
    the cost of such expenditures moving forward. And Mr. Chairman,
    I would ask whether you might be able to join me in that
    request.
        Mr. Lankford. Yes, that is a difficult one to track, just
    because the IRS Code is nine times longer than the Bible. You
    think we have a few exceptions in there? [Laughter.]
        Mr. Connolly. Exactly.
        Mr. Lankford. Gathering all of that and what the values
    include I am sure would be quite a task. I don't know whether
    it would be GAO or who that might be to be able to land on and
    help us determine those types of things.
        Mr. Connolly. Thank you so much.
        Mr. Lankford. You are welcome.
        Mr. Connolly. My final point, question, would be, I assume
    that both the CTO and the CIO, Mr. Chopra and Mr. Kundra, are
    involved in the deployment of technology with your CFO counsel
    in trying to aid and disseminate best practices, eliminate
    duplication and improve transparency?
        Mr. Werfel. Absolutely. It is a partnership. Vivek Kundra,
    the Government CIO, could have been sitting here today just as
    I am, with the emphasis of this hearing on reliability of
    reporting, potentially on issues of audit. It just made more
    sense for me to be here. But we are attached at the hip on
    these issues.
        We have to solve this with a multidisciplinary approach. If
    it is just the auditor, just the accountant, not going to get
    it done. The technologist is critical to this effort as well.
        Mr. Connolly. I think that is a really important point, Mr.
    Chairman. With that, I yield back my time and I thank the Chair
    for his generosity and consideration.
        Mr. Lankford. Thank you.
        Mr. Werfel, let me just run through a litany of questions
    here, and just short answers, and try to run through a couple
    of things on it as we finish this out. Thank you for waiting
    through the lunch hour to be able to be here as well, as we
    were finishing up the voting.
        You had mentioned earlier that there was a need for some
    legislation to correct some of the data needs that are out
    there. I would like for your office to be able to provide to
    our committee that list that you would say, here are the
    legislative fixes that we need to be able to help resolve those
    things. If you could get that back to us, we will make sure
    that we share that in a bipartisan way. And that would be very
    helpful to us.
        There are a maze of sites that are out there. Recovery.gov
    was very well done. It got the information out quickly. It was
    so successful that now we have multiplied the dot gov and now
    we have Recovery.gov and paymentaccuracy.gov and
    Itdashboard.gov and all the agencies have it, Research.gov,
    Data.gov, and it goes on and on. I am missing many that I know.
        How does an individual go find their information now? We
    have moved from, it is out there, go search for it, when
    originally the design was, let's lock in a Data.gov,
    USAspending.gov and say, if you are looking for something, go
    there. Is that still the mission? If so, how is it going?
        Mr. Werfel. You are raising an enormously challenging
    element of open government and transparency. And there are many
    challenging elements to it. One of them is getting the data out
    there. And we are trying, and I think making important
    progress, in getting more real information and other types of
    reports public, in particular through the Web.
        Another challenge, and there are numerous, but the other
    challenge is, sometimes the quantity of the data that is out
    there can be overwhelming, and how are we assisting the
    citizenry in accessing that information. And right now, I think
    you have hit on something that is part of a strategy. It might
    not be the most effective strategy, and it is evolving. But it
    is the branding of our Web sites in ways that make sense. If
    you want to learn about grants, go to Grants.gov. If you want
    to learn about where Federal dollars are going,
    USAspending.gov. If you are curious about the Recovery Act,
    Recovery.gov. And you see the theme of trying to make it
    logical.
        And we do a lot of work with citizens and user group around
    these efforts to say, what works for you. We don't do these Web
    sites in a vacuum.
        Mr. Lankford. Correct. But what is the central portal going
    to be? If I don't know which one to go to, where do I go to
    say, this is where I start?
        Mr. Werfel. I don't think that we have established a
    consistent central portal. I know that in the previous
    administration there was First.gov, there is USA.gov is
    available. But I don't think that we have championed the
    starting point portal for the rest of Government.
        Mr. Lankford. Let me ask you, and obviously I am not going
    to order you one way or the other on this, but let me ask you
    to examine that. Because people outside of the Beltway do not
    know where to go. They do not know if they are looking for food
    stamp information to go to the Agriculture Department. They are
    not aware that there are education programs in the Department
    of Defense. They don't know how to be able to search for those
    things.
        So they need a central portal to go be able to ask the
    questions, if they are going to get the data, then it can take
    them to the spot it is going to go. It doesn't have to be all
    in one place, it can be these various sites. It does make
    sense. There are going to be some watchdog groups that are
    always going to land on Research.gov, that is what they
    research. That is what they want to go after. Or the
    Grants.gov.
        But there has to be a place for people to be able to go to
    if the information is out there that they know. Otherwise, many
    of the things that we talked about earlier, Dr. Harris and
    others, it is on their agency Web site. It is not on Data.gov,
    it is not on USAspending.gov, it is over on their agency. So I
    can't go find it.
        Mr. Werfel. So, yes, let me just recommit to the point that
    we are working toward that objective. We have, as you
    mentioned, some success with the branding in terms of certain
    stakeholders who automatically know where to go, and we develop
    important partnerships with them. And that efforts are underway
    to reconcile the various dot govs. What I would like to do, as
    you say, come back, we will show you some of our thoughts on a
    strategic vision for that. Then let's partner together toward
    the right strategic vision.
        Mr. Lankford. Let me bounce a couple of other things past
    you. There is a great need, we heard from Agriculture and
    Education, that some data standards, if things are going to go
    up, here is how they need to go up. And I gave the example
    earlier of an address field that includes the entire address,
    including State, city, zip code in one field. That is obviously
    not searchable. A single entity, that is, a contractor, needs
    to have an i.d. number that someone can search for that
    contractor and they can chase them down. There is a need for
    OMB to be able to provide that to the agencies, here are more
    data standards. Even begging the question, what is a
    significant piece of data out there.
        And the for-instance on that. If someone is going and
    looking for how many employees does an agency have, what is
    their budget, what are the programs that they are doing, and
    what is the mission of those programs, there is no place they
    can go to get that. They are stuck searching through an agency
    Web site that may or may not have that. That seems to be fairly
    usable data that I think most American taxpayers would want to
    be able to look at a site, like a Data.gov, like something,
    whatever it may be, and to say, how many people work there,
    what is the mission of the departments that are there, what are
    even the names of the departments that are there, and what is
    the budget for that.
        To find an established piece on that, if that is something
    OMB can begin on, that is something I think we should begin on
    as well, to say there is a basic transparency piece that needs
    to get out there. Does that seem reasonable to you?
        Mr. Werfel. It absolutely does. I think if you looked at
    the landscape of data across Government, you are obviously
    going to find significant heterogeneity and opportunities for
    standardization. You will see some pockets of standardization
    that are promising and that we can buildupon. But what you will
    also find is a lot of work to be done. We need to move out on a
    strategic set of priorities. We have started.
        Mr. Lankford. And I will tell you, Ranking Member Connolly
    and I have both affirmed that. This is the first administration
    to do this level of it. This is the beginning point, we
    understand.
        The criticism is not that we are starting it. Way to go on
    starting it and getting it out there. I want to find out, what
    are the lessons learned, what are we missing, what are people
    asking for. Let me give you a for instance on it. It would be a
    help to this committee that when the emails come back as
    feedback, and there are several of your sites that say, for
    feedback or contact us for more questions, what data are you
    looking for, basically, if our committee were to get those
    things in real time at the same time.
        Not that we are going to respond to those things, but hat
    would allow us in our oversight role to be able to say, you
    know what, these are the data pieces people are asking for. And
    if our committee could get that unfiltered, and it could be
    shared bipartisan, then people could get a chance to say, you
    know what, a lot of people seem to be asking for this. Why is
    it that we don't provide that? That would allow us to do our
    oversight a lot stronger.
        And let me make another comment to you. You mentioned
    Recovery.gov. That is a very successful site, you are right, it
    was very well done, and the information was unprecedented that
    was put out. My feeling on it is, one of the successes of it
    was the recipients were uploading information. It wasn't just a
    Government entity that was putting it down there, they have
    lots of other things. But the recipients were saying, yes, we
    received this, this is what we received and this is the
    feedback for it.
        That is of great benefit. Is that something that is going
    to continue, and can that be replicated in USAspending.gov and
    other places?
        Mr. Werfel. Yes, and there are many, many, a lot of the
    information that the Federal Government reports today, the
    source is the recipient of the Federal dollars reporting what
    is going on with the dollars from a financial perspective, a
    performance perspective.
        What was, I think, unique about the Recovery Act was the
    automated nature of it, the speed of it, all of that.
        Mr. Lankford. Correct. That is a platform that now exists,
    though. What I am asking is, is that a platform that will
    continue to be used? Will it be replicated in other areas to
    say the recipient can quickly say, yes, we have received this
    grant, and also be able to come back and say, this is what was
    done with it? Because one of the primary questions that I get a
    lot about grants and contracts and other things, was it
    actually accomplished? Did we do it? What happened with that?
        I think there would be people that could look around their
    own neighborhood and could find, this is what happened in my
    area, I had no idea that the Federal Government was involved in
    this area in positive ways. But they don't know, unless there
    is some reporting back on accountability on that.
        So that Recovery.gov platform of recipient reporting, is
    that something that is going to be multiplied out and used?
        Mr. Werfel. It is, and it is ongoing today. We have more
    and more modernized and more seamless ways of collecting
    information from non-Federal stakeholders. And that is going on
    today.
        Mr. Lankford. In the USAspending.gov and other places, as
    has been referenced by several people, when there are gaps in
    it, and information is not showing up, or it is showing up as a
    contract is here, or the grant is here, but just zero amount,
    how are they held to account in the agencies to get that
    information correctly? Whether it be a data field that is not
    done, or the dollar amounts are completely left out, is there a
    chain of command? Is there someone verifying that and saying,
    hey, we have to get this correct?
        It seems that 30 some odd percent accuracy rate is not
    quite high enough for us.
        Mr. Werfel. A couple of responses there. First, as
    mentioned earlier in my testimony and mentioned on the first
    panel, right now the process is a self-assessment. We have
    asked the agencies to create a senior accountable official, and
    then an internal process to validate completeness and accuracy.
    And there are some limitations in the self-assessment. An
    independent eye, whether it is the Inspector General or an
    auditor, coming in to review that, is going to drive
    improvements and more objectivity and the results will improve.
        Second, I want to just, on the record, take a different
    perspective on the 30 percent success rate that was in the
    testimony of one of the other witnesses from the Sunlight
    Foundation. We have concerns with the methodology surrounding
    that. And I don't need to go into great detail. But we do not
    believe the success rate is as low as the Sunlight Foundation
    said.
        Mr. Lankford. It is just the key data coming out. I did a
    quick search on just for Oklahoma, my home State, and to be
    able to look at it and see some of the things that are in
    USAspending.gov, and tracking through the different things that
    are there. There is just a for instance. Last year there was a
    helicopter services contract that was put out, but there is no
    amount that is listed on that one. So we don't know what that
    one is.
        But there is apparently a peanut butter contract for a
    little over $2 million. That seems like a large amount of
    peanut butter. We go through a lot of it at my house. But on
    this particular report, I could go on and on, there are
    multiple areas that are zeroed out, page after page, there are
    about 17 pages listed, a lot of zeroes that are listed here.
    And I don't know if we bought $2 million worth of peanut butter
    in Oklahoma or not, from a Government contract.
        But there just seem to be some issues that I can look at,
    and I can say, OK, somebody needs to be verifying this data and
    making sure it is complete, and there needs to be a process. It
    is a very good thing to get the data out there. But to get it
    out wrong or incomplete raises all sorts of questions.
        Mr. Werfel. Absolutely. And as I think was evidenced during
    the first panel, some of the criticisms or concerns about the
    data have rational explanations and some of them, it is just a
    basic data quality issue that we need to address. I think the
    more people that are searching this data and using this data
    the more we move in the direction of better quality. The fact
    that you can go online and find $2 million of Federal dollars
    were spent on something related to peanut butter is something
    that could not have been done before.
        Mr. Lankford. That is correct.
        Mr. Werfel. And for that, we want to celebrate that,
    leverage it, make sure that we do have a more accountable
    government. But as you point out, there are gaps in the
    reporting and we are working on closing them.
        Mr. Lankford. That is the best gift that we can give, is
    transparency. Watchdog groups, outside citizen groups, the
    contractors themselves being able to look at the site and say,
    was it reported correctly, is that accurate, is a tremendous
    asset to them. We want to continue to multiply that and make
    sure that does occur.
        So with that, Mr. Connolly, did you have additional
    questions?
        Mr. Connolly. If the chairman would yield, I was just going
    to add to your point that it may be a good thing to celebrate
    the fact that we can now solve the peanut butter mystery. But
    on the other hand, we may want more information. And I would,
    because it is not intuitively obvious to the searcher why we
    would be spending $2 million tax dollars on peanut butter.
        So while we are celebrating the fact that one can access
    that piece of data, I would hope that, to the chairman's point,
    that we try to make these search engines even more useful by
    way of, here is why we are buying $2 million worth of peanut
    butter.
        Mr. Werfel. Right. And as an example, if I could respond to
    that, a legitimate explanation might be, it might be part of
    the school lunch program, and therefore, there is an easy
    explanation.
        Mr. Lankford. I completely agree. And I would say that the
    ranking member mentioned in his opening statement that there is
    not a need to be able to track every paper clip. That is not
    what I think the American people are looking for on it. But I
    think it is these broad categories, to know that it is
    consistent, we know what that is, the information is getting
    out there, it is trackable, it is traceable.
        For instance, if a report is done, people want to know, if
    there is a report done on wildfires in a certain bird nest, it
    asks the obvious question, how much did that cost to do that
    report? Well, we know, there was a grant that was given to be
    able to do that. We should be attaching that report to the cost
    of producing that report so everyone could know and evaluate,
    is that good use of taxpayer dollars, and instruct the
    conversation. That is a good thing for us as legislators, to be
    able to look at and be able to see, and for people in our
    districts to hold us to account on that. That is a good thing
    for us to hold you to account, to say we need that information
    to get out there for reports done, how much does it cost, can
    they find it and be able to track it is a reasonable thing.
        If there are no additional questions, Mr. Werfel, thank you
    very much for being here. We have a great deal to do. We look
    forward to your followup reports on it, and this hearing is
    adjourned.
        [Whereupon, at 1:15 p.m., the committee was adjourned.]