    [Senate Hearing 114-139]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 114-139

              IMPROVING PAY FLEXIBILITIES IN THE FEDERAL WORKFORCE

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

                                    HEARING

                                   before the

                                SUBCOMMITTEE ON
                   REGULATORY AFFAIRS AND FEDERAL MANAGEMENT

                                     of the

                                  COMMITTEE ON
                             HOMELAND SECURITY AND
                              GOVERNMENTAL AFFAIRS
                              UNITED STATES SENATE

                        ONE HUNDRED FOURTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                OCTOBER 22, 2015

                                   __________

                       Available via http://www.fdsys.gov

           Printed for the use of the Committee on Homeland Security
                            and Governmental Affairs

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            COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                        RON JOHNSON, Wisconsin, Chairman
    JOHN McCAIN, Arizona                 THOMAS R. CARPER, Delaware
    ROB PORTMAN, Ohio                    CLAIRE McCASKILL, Missouri
    RAND PAUL, Kentucky                  JON TESTER, Montana
    JAMES LANKFORD, Oklahoma             TAMMY BALDWIN, Wisconsin
    MICHAEL B. ENZI, Wyoming             HEIDI HEITKAMP, North Dakota
    KELLY AYOTTE, New Hampshire          CORY A. BOOKER, New Jersey
    JONI ERNST, Iowa                     GARY C. PETERS, Michigan
    BEN SASSE, Nebraska

                        Keith B. Ashdown, Staff Director
                  Gabrielle A. Batkin, Minority Staff Director
               John P. Kilvington, Minority Deputy Staff Director
                         Laura W. Kilbride, Chief Clerk

           SUBCOMMITTEE ON REGULATORY AFFAIRS AND FEDERAL MANAGEMENT

                       JAMES LANKFORD, Oklahoma, Chairman
    JOHN MCCAIN, Arizona                 HEIDI HEITKAMP, North Dakota
    ROB PORTMAN, Ohio                    JON TESTER, Montana
    MICHAEL B. ENZI, Wyoming             CORY A. BOOKER, New Jersey
    JONI ERNST, Iowa                     GARY C. PETERS, Michigan
    BEN SASSE, Nebraska
                         John Cuaderess, Staff Director
                      Eric Bursch, Minority Staff Director
                          Rachel Nitsche, Chief Clerk

                                C O N T E N T S

                                     ------
    Opening statement:
                                                                       Page
        Senator Lankford.............................................     1
        Senator Heitkamp.............................................     2
        Senator Ernst................................................    13
    Prepared statement:
        Senator Lankford.............................................    33
        Senator Heitkamp.............................................    35

                                   WITNESSES
                           Thursday, October 22, 2015

    Brenda Roberts, Deputy Associate Director for Pay and Leave, U.S.
      Office of Personnel Management.................................     4
    Debra A. Warner, Director of Civilian Force Management, Deputy
      Chief of Staff for Manpower, Personnel, and Services,
      Headquarters, U.S. Air Force...................................     6
    Linda Jacksta, Assistant Commissioner, Office of Human Resources
      Management, U.S. Customs and Border Protection, U.S. Department
      of Homeland Security...........................................     7
    Anthony M. Reardon, National President, National Treasury
      Employees Union................................................    24
    William R. Dougan, National President, National Federation of
      Federal Employees..............................................    26

                         Alphabetical List of Witnesses

    Dougan, William R.:
        Testimony....................................................    26
        Prepared statement...........................................    64
    Jacksta, Linda:
        Testimony....................................................     7
        Prepared statement...........................................    51
    Reardon, Anthony M.:
        Testimony....................................................    24
        Prepared statement...........................................    58
    Roberts, Brenda:
        Testimony....................................................     4
        Prepared statement...........................................    37
    Warner, Debra A.:
        Testimony....................................................     6
        Prepared statement...........................................    42

                                    APPENDIX

    Statement submitted for the Record:
        Federal Law Enforcement Officers Association.................    71
        American Federation of Government Employees, AFL-CIO.........    75

              IMPROVING PAY FLEXIBILITIES IN THE FEDERAL WORKFORCE

                                  ----------

                           THURSDAY, OCTOBER 22, 2015

                                     U.S. Senate,
                            Subcommittee on Regulatory,
                          Affairs and Federal Management,
                        of the Committee on Homeland Security
                                      and Governmental Affairs,
                                                        Washington, DC.
        The Subcommittee met, pursuant to notice, at 9:33 a.m., in
    room 342, Dirksen Senate Office Building, Hon. James Lankford,
    Chairman of the Subcommittee, presiding.
        Present: Senators Lankford, Ernst, Heitkamp, and Peters.

                 OPENING STATEMENT OF SENATOR LANKFORD

        Senator Lankford. Good morning, everyone. I want to welcome
    you to today's Subcommittee hearing, which will focus on the
    topic of pay flexibilities in the Federal workforce. I
    appreciate everyone being here.
        We all want a Federal Government that runs efficiently and
    effectively for the American people. It is a bipartisan goal to
    find Federal employees who are dedicated to serve our fellow
    citizens with excellence. Why would anyone want to have Federal
    public servants that are not skilled and competent for the
    task? Attracting and keeping the best employees to serve in
    Washington, D.C. and around the country is an effort worthy of
    the Subcommittee's time and attention.
        The Federal workforce stretches across our Nation, with a
    different set of opportunities and challenges at each location.
    Some unique considerations within the Federal workforce are
    longstanding and clear. The challenges posed can be as simple
    as the differences in climate and location. Imagine how
    different it is to attract a skilled Federal worker to a post
    in a rural northern town in Alaska than it is to Miami, Florida
    or Tulsa, Oklahoma.
        However, we have also encountered Federal workforce
    challenges that are not foreseeable or are challenging due to
    varying economic circumstances. A prime example of this was the
    unexpected and dramatic 2006 discovery of large amounts of oil
    in Eastern Montana and North Dakota. Since 2006, the oil boom
    in North Dakota has seen an incredible increase in the economic
    activity, such as housing, infrastructure demands, to name only
    just a few. With these demands came an inevitable tug of war
    between the private sector and government to see who could hire
    the best workers.
        I commend Ranking Member Heitkamp for her leadership in
    addressing the very real challenges that face her State and the
    Bakken region and for her work on Federal workforce and pay
    flexibility. I hope that with today's hearing, we can help make
    sure the Federal Government and the private sector have enough
    skilled workers to meet both of their demands.
        We have with us today two panels of witnesses who are
    prepared to share their own perspectives on these issues. In
    our first panel, we have Brenda Roberts, Deputy Associate
    Director of Employee Services, Pay and Leave, from the Office
    of Personnel Management (OPM).
        We have Linda Jacksta, Assistant Commissioner, Office of
    Human Resources Management, from U.S. Customs and Border
    Protection (CBP).
        And, finally, Debra Warner, who is Director of Civilian
    Workforce Management, Deputy Chief of Staff for Manpower,
    Personnel, and Services from the U.S. Air Force.
        On our second panel, we will hear testimony from William
    Dougan, who is the President of the National Federation of
    Federal Employees (NFFE), and Mr. Anthony Reardon, President of
    the National Treasury Employees Union (NTEU).
        We thank each of you for being here this morning. I look
    forward to an informative discussion with our witnesses.
        With that, I recognize Ranking Member Heitkamp for her
    opening statement.

                 OPENING STATEMENT OF SENATOR HEITKAMP

        Senator Heitkamp. Thank you, Chairman Lankford.
        I am so pleased that today we are going to focus on a topic
    that is so important to my home State of North Dakota, the
    businesses that operate there, the tribes that operate there,
    and we heard that yesterday as Senator Lankford and I sat
    through a hearing on the failure of the Department of Interior
    (DOI) to move leasing applications and applications for rights-
    of-way along, costing, really, tribes millions of dollars in
    lost revenue because their resources have not been accessible
    to the private sector. And one of the issues has been, for us,
    this issue of flexibility and recruitment of a Federal
    workforce.
        As many of you know, I have been fighting to address these
    challenges that have been faced by the Federal workforce in the
    Bakken region of Western North Dakota and Eastern Montana since
    taking office in 2013, so this is a topic that I am well
    familiar with. I think it is the reason why we are here,
    because of the frustrations that we had listening to some of
    the obstacles. Even though intentions for both the agencies and
    for people in your roles in personnel is to do what is fair and
    equitable, the rules somehow get in the way.
        So, I think the Bakken region, although unique in our
    State, serves as a prime example of the drastic impact that
    unique economic situations can have on local and regional
    employment markets. The energy boom has brought new jobs and
    opportunity, but it has also seen a spike in the cost of
    living, in fact, some would say skyrocketing. I like to say, at
    the peak of the boom, the rent rates in Williston, North
    Dakota, would make a New York landlord blush.
        The pay system just was not flexible enough to accommodate
    and remain competitive with the private sector. We would see
    public employees being hired, only to be transitioned off--
    especially petroleum engineers, especially people who have
    expertise in managing land and rights-of-way. Very difficult
    for them to hang on. Even if they had a desire to stay in the
    Federal system, what we saw was the inability to do that and
    still feed their families.
        Working in close conjunction with the Office of Personnel
    Management, special pay rates became the most effective path
    forward for Federal agencies in the Bakken. We were able to
    bring the Director of the Office of Personnel Management to
    North Dakota, and I am pleased to say that nearly 500 Federal
    employees across North Dakota were helped with special rate
    increases.
        That is a tribute, and I want to do a shout out to the
    Department of Defense (DOD). I think both the Air Force and the
    Department of Defense saw the unique situation, and when we
    were in a room with civilian employees and I asked how many of
    them were veterans, over half raised their hand. And, that is
    really the message of the civilian employees probably at every
    air base or every military base across the country. They are
    still in the mission. They may not be putting on the uniform
    every day, but they want to participate and to contribute to
    keeping this country safe. But, they should not have to pay an
    economic price to do that.
        I think there is a lot more work that can be done. I think
    there is a lot bigger discussion about flexibility, and that is
    what we hope to get at today, not rehash what we did, but talk
    about where we could have achieved more flexibility.
        One of the great concerns that I have, Ms. Jacksta, is
    obviously staffing the Northern border. The remoteness along
    with the inability to recruit workforce, I think, suggests that
    we may not be doing everything that we can to keep all of our
    border safe.
        And, so, I am looking forward to a productive dialogue this
    morning on the best ways for the Federal workforce to address
    the unique economic challenges, how we can improve the current
    pay flexibility system, and what we can do to make sure that
    our Federal agencies have all the necessary tools at their
    disposal to keep the Federal workforce as vibrant as possible.
        We have had long discussions here about the future of the
    Federal workforce and what that means in terms of the
    millennials. I think the lack of flexibility, putting a very
    dynamic workforce into a very static environment where there is
    not a lot of flexibility, is not a formula for success and
    recruiting the best and brightest. So, this is clearly another
    issue that goes to the future of the Federal workforce.
        And, I want to thank my Chairman, Chairman Lankford, for
    agreeing to do this hearing and for working with us to address
    these Federal workforce issues. Thank you, Mr. Chairman.
        Senator Lankford. I am glad to be a part of this.
        At this time, we will proceed with testimony from our first
    panel, and the witnesses on the panel, I have already
    introduced. Brenda Roberts, Debra Warner, and Linda Jacksta, I
    appreciate you all being here, as well.
        I would ask you, as is the tradition of this Committee, to
    stand and raise your right hand, and be sworn in.
        Do you swear the testimony you are about to give before the
    Subcommittee will be the truth, the whole truth, and nothing
    but the truth, so help you, God?
        Ms. Roberts. I do.
        Ms. Warner. I do.
        Ms. Jacksta. I do.
        Senator Lankford. Thank you. You may be seated. Let the
    record reflect the witnesses answered in the affirmative.
        I do appreciate again you being here today and I would like
    to ask you to begin with your opening statement, beginning with
    Ms. Roberts.

     TESTIMONY OF BRENDA ROBERTS,\1\ DEPUTY ASSOCIATE DIRECTOR FOR
           PAY AND LEAVE, U.S. OFFICE OF PERSONNEL MANAGEMENT

        Ms. Roberts. Thank you. Chairman Lankford, Ranking Member
    Heitkamp, and Members of the Subcommittee, thank you for the
    opportunity to discuss the role of Federal pay policies in
    recruiting and retaining an effective Federal workforce. I
    appreciate the opportunity to have this discussion.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Ms. Roberts appears in the Appendix
    on page 37.
    ---------------------------------------------------------------------------
        As part of our core function, OPM provides a key role in
    regulating, overseeing, and administering the authorities on
    compensation policies, including available pay flexibilities,
    to help agencies recruit and retain their most valuable
    resource, which is their employees.
        As with any compensation system, there are special
    challenges. It is important to remember that each agency's
    mission and needs are different, and Congress has established
    many complex arrangements to accommodate these agencies' needs.
    During this time of tighter agency budgets and sequestration,
    Federal agencies are being very careful in how they allocate
    their human capital resources.
        In light of the current climate, it is extremely important
    for agencies to strategically use pay flexibilities to attract
    desirable applicants and support the retention of good
    employees. In addition, it is just as important for agencies to
    consider non-pay flexibilities that we refer to as workplace
    flexibilities.
        I know the topic of Federal employee compensation has a
    real implication for some of the residents in your State,
    Senator Heitkamp. I am pleased I had the opportunity to join
    you in North Dakota last year and hear directly from your
    constituents about the challenges that they are facing as a
    result of the rapidly increasing cost of living in the Bakken
    area due to the dramatic increase in oil and gas production.
        Agencies have autonomy to determine the appropriate and
    cost effective use of pay flexibilities under Title 5 of the
    U.S. Code. These flexibilities include short-and long-term
    tools that can be used to attract and keep a Federal workforce
    in place. OPM provides guidance to agencies on the various
    flexibilities available and encourages agency headquarters'
    human resources staff to reach out to OPM for advice when
    determining which of the many pay, leave and other workplace
    flexibilities may be best suited to resolve the agency's
    recruitment and retention problems.
        I would like to mention a few of the pay flexibilities that
    the Federal Government has to offer to help with recruitment
    and retention problems. First, I would like to mention our 3Rs
    program, which comprises recruitment, retention, and relocation
    incentives.
        Agencies can also choose to participate in the student loan
    repayment program, under which agencies can repay federally
    insured student loans for candidates and current employees of
    the agency.
        Other alternatives include superior qualification and speed
    needs pay-setting authority that allow agencies to set pay at a
    higher rate for a newly appointed General Schedule (GS)
    employee if the employee has superior qualifications or would
    address a special need of that agency.
        There are also specific pay flexibilities that may be used
    to address long-term staffing difficulties where OPM plays a
    more active role because of the need to ensure agencies operate
    on a level playing field. This can be accomplished with special
    rates when agencies identify a business need to offer higher
    rates of pay for groups or categories of General Schedule
    positions in one or more geographic areas. Special rates may be
    appropriate when there is a need to address significant
    hardships in recruiting and retaining a well qualified
    workforce.
        Agencies can also seek to offer critical position pay. At
    an agency's request, OPM, in consultation with the Office of
    Management and Budget (OMB), can grant and fix a rate of pay
    for one or more positions at a higher rate than would otherwise
    be payable. The position under consideration must require an
    extremely high level of expertise in a scientific, technical,
    professional, or administrative field that is critical to the
    successful accomplishment of an important agency mission.
        In addition to the various pay flexibilities, the President
    has directed OPM to build on our leadership through the
    increased awareness and availability of workplace flexibilities
    and Work-Life Programs to help agencies with recruitment and
    retention problems. These efforts have been fueled in part by
    the President's belief that all employers, including the
    Federal Government, should support parents to ensure they
    contribute fully to the workplace while meeting the needs of
    their families.
        This has led OPM to issue two handbooks in the past year
    emphasizing the importance of workplace flexibilities. OPM's
    guidance will allow agencies to be in a better position to
    assist and educate employees in using these workplace
    flexibilities.
        So, in summary, OPM stands ready to assist agency
    headquarters with the various pay and workplace flexibilities
    available to help ensure the recruitment and retention of the
    strongest employees that this country has to offer.
        Thank you for the opportunity to testify today, and I look
    forward to taking your questions.
        Senator Lankford. Thank you. Ms. Warner.

      TESTIMONY OF DEBRA A. WARNER,\1\ DIRECTOR OF CIVILIAN FORCE
    MANAGEMENT, DEPUTY CHIEF OF STAFF FOR MANPOWER, PERSONNEL, AND
                 SERVICES, HEADQUARTERS, U.S. AIR FORCE

        Ms. Warner. Good morning, Chairman Lankford, Ranking Member
    Heitkamp, and distinguished Members of the Subcommittee. On
    behalf of the Secretary of the Air Force, Deborah Lee James, I
    appreciate the opportunity to appear before you to discuss pay
    flexibilities in the Federal workforce.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Ms. Warner appears in the Appendix on
    page 42.
    ---------------------------------------------------------------------------
        When any of our Air Force bases experience severe
    challenges to recruit and retain civilian employees to execute
    its mission, it becomes a concern. But when the base is host to
    two components of our country's nuclear triad, it becomes even
    more alarming and takes on a significantly higher level of
    concern.
        Such was the case at Minot Air Force Base in North Dakota,
    home of the 5th Bomb Wing, Guardians of the Upper Realm, and
    the Rough Riders of the 91st Missile Wing when the economic
    boom from oil and gas exploration in the Bakken region, which
    began in approximately 2006, obtained traction and skyrocketed.
    The usual economic indicators quickly showed that the Bakken
    region and the State's unemployment at incredible lows as jobs
    directly and indirectly related to oil and gas industries,
    along with related businesses, were plentiful.
        Along with the bonanza of employment opportunities and the
    accompanying higher wages and rates of pay came an increase in
    the basic cost of living. Housing became more expensive and
    difficult to obtain, not only for the sudden influx of workers
    seeking jobs in the energy sector, but for the Air Force's
    active duty members and civilian employees, as well.
        For the civilians at Minot Air Force Base who faithfully
    support a highly visible national defense strategy, the allure
    of higher wages and signing bonuses in the private sector was
    difficult to resist. The cost of basic needs, such as food,
    housing, and transportation, reached levels that pushed many
    Air Force civilians to make a difficult choice between
    remaining a part of the Minot Air Force Base team and pursuing
    more lucrative employment opportunities outside the gate.
        It quickly became apparent this challenge was not one with
    a quick fix. It was a chronic challenge, requiring both short-
    and long-term solutions. The feasibility of establishing a
    separate locality pay area for the Bakken region was carefully
    considered. However, with locality pay measuring the cost of
    labor, not the cost of living, and only applying to the General
    Schedule population, it was recognized this option would not be
    a complete solution. Ultimately, a decision was made that the
    Air Force should use existing pay flexibilities, such as
    Special Salary Rates and recruitment and retention incentives,
    to help tackle this very difficult problem.
        The effort began in earnest in the summer of 2014 and was
    greatly enhanced with a collaboration between the entire Minot
    Air Force Base team, the Air Force Global Strike Command
    (AFGSC), and the Civilian Workforce Management Directorate at
    Headquarters Air Force. Data was gathered by the Minot Air
    Force civilian-based population, analyzed to support the
    Special Salary Rate request by depicting the employment
    situation and what dire straits we were in.
        Simultaneously, the Headquarters Air Force Civilian Policy
    Office engaged with our colleagues at the Defense Civilian
    Personnel Advisory Service (DCPAS), to advise them of this
    effort and to obtain guidance in assembling the request
    packages in an effort to expedite the review and, subsequently,
    the final review by the Office of Personnel Management.
        The first two Special Salary Rate packages of 25 percent
    for both General Schedule and Federal Wage targeted positions
    was submitted in late September 2014, and the third, with a 35
    percent increase for specific non-appropriated funds (NAF)
    positions, being sent in October 2014.
        The NAF request, which covered five different occupations,
    was approved and became effective in early December 2014. The
    Federal Wage Special Salary package, which included 17 specific
    occupations, was approved in March 2015, and approval for the
    General Schedule Special Salary Rate request covering 15
    targeted positions was received in April 2015.
        In addition to the Special Salary Rate pursuant, local
    officials also approved a payment of 10 percent incentive for
    employees who occupied non-Special Salary Rate-covered
    positions, and that continues today.
        The use of other incentives, such as relocation and
    recruitment, are also used in order to attract new employees to
    fill the vacant positions at Minot Air Force Base.
        The flexibilities available to Federal agencies are
    beneficial in managing these unique recruitment and retention
    circumstances, especially for our Air Force installations
    located in remote or isolated locations.
        In the final analysis, the Air Force civilian employees
    consider it an honor and a privilege to work shoulder-to-
    shoulder with the active duty, Guard, and Reserve airmen
    supporting the warfighter. It is vital that the Federal service
    be afforded avenues to obtain, sustain, and maintain an
    effective, stable civilian workforce.
        Thank you for the opportunity to testify today, and pending
    your questions, this concludes my remarks.
        Senator Lankford. Thank you. Ms. Jacksta.

     TESTIMONY OF LINDA JACKSTA,\1\ ASSISTANT COMMISSIONER, OFFICE
        OF HUMAN RESOURCES MANAGEMENT, U.S. CUSTOMS AND BORDER
            PROTECTION, U.S. DEPARTMENT OF HOMELAND SECURITY

        Ms. Jacksta. Chairman Lankford, Ranking Member Heitkamp,
    distinguished Members of the Subcommittee, thank you for the
    opportunity to appear before you today to discuss CBP's efforts
    to utilize pay and compensation flexibilities to recruit, hire,
    and retain our most prized asset, our people.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Ms. Jacksta appears in the Appendix
    on page 51.
    ---------------------------------------------------------------------------
        I come from a family that has deep roots with the U.S.
    Customs Service and CBP. I share that with you because I have a
    profound sense of commitment and dedication to this
    organization and its mission. Throughout my own 30 years of
    service with CBP and the former U.S. Customs Service, working
    in both operational and support positions, I have seen
    firsthand the impact that CBP employees have in fostering our
    Nation's security and economic prosperity.
        I also want you to know that CBP recognizes and values our
    importance to the local communities we support. As our workload
    volumes continue to increase, open border crossings become a
    vital link to supporting the local and national economies, as
    well as our service to local citizens in these areas. We value
    this service and we recognize its importance to you and your
    constituents.
        Since taking office as the Assistant Commissioner, Office
    of Human Resources Management, in August of this year, one of
    my top priorities has been working to recruit, hire, and retain
    the agency personnel needed to accomplish CBP's border security
    mission. Throughout my first 60 days, I have begun to
    strategically assess how to most effectively provide the
    flexibilities we need to ensure that every port, sector,
    branch, and office is staffed commensurate with mission needs.
        Due to the varying nature of CBP's workforce along the
    northern and southern borders, many of our areas of
    responsibility are remote. These locations are often
    accompanied by challenging environmental factors, inaccessible
    medical facilities, limited employment or educational
    opportunities for families, and higher prices for consumer
    goods and services. In addition, these areas are sometimes
    associated with a higher cost of living, as well. Staffing
    those locations with both new hires and experienced existing
    personnel is critical to meeting the operational requirements
    involved for securing the Nation's border against a variety of
    dynamic threats and adversaries.
        Historically, CBP has used some pay flexibilities, to
    include relocation, recruitment, and retention incentives. For
    example, from 2011 to 2014, CBP issued over 100 incentives to
    attract and retain a highly skilled and qualified workforce.
        We are taking a holistic approach going forward to look
    strategically at incentives and other pay and non-pay options
    to identify the best approach to address our recruitment and
    retention challenges. In particular, we will explore the use of
    Special Salary Rates in order to provide employees with an
    increase to their basic rate of pay, particularly in areas
    where there is a higher cost of living, and to give CBP an
    added tool in remaining competitive in attracting and retaining
    a highly skilled workforce. The Special Salary Rate is also
    important as a retention tool, as the pay increase is added to
    an employee's retirement calculation.
        CBP recognizes the impact the Special Salary Rate could
    have on retaining critical personnel. We are already pursuing a
    Special Salary Rate for our polygraph examiners, a severely
    limited resource that plays an imperative role in hiring our
    front-line employees.
        In addition to traditional pay incentives, CBP is also
    looking at alternative non-pay flexibilities geared toward
    enhancing work life balance and professional growth
    opportunities. We are also considering rotational assignments,
    alternative work schedules, and other mobility options in order
    to support the needs of our workforce.
        We recognize that while these pay and non-pay flexibilities
    can help with recruitment and retention, we also understand
    that they are typically associated with financial implications
    which need to be carefully balanced with the other needs of
    CBP.
        CBP's greatest asset are the dedicated men and women who
    pursue our mission every day as they safeguard and manage the
    United States air, land, and maritime borders with vigilance,
    selfless service, and unyielding integrity.
        Chairman Lankford, Ranking Member Heitkamp, distinguished
    Members of the Subcommittee, thank you for holding this
    important hearing, and I am happy to answer your questions.
        Senator Lankford. Thank you.
        I am going to defer to the Ranking Member to do initial
    questions.
        Senator Heitkamp. Thank you so much, Mr. Chairman.
        I was just jotting down here who are these folks in North
    Dakota, and you look at them. They are obviously the civilian
    workforce at the air bases, both Minot and Grand Forks, Border
    Patrol, Customs and Border Protection. We have a number of
    crossings, some of which have huge staffing challenges.
        USDA Farm Service Agency--think about them. I cannot tell
    you, as we were implementing the farm bill, how critical that
    workforce and that relationship was to helping farmers navigate
    a very complicated piece of legislation and help them make the
    best decision for their production.
        The Federal Bureau of Investigation (FBI) the Drug
    Enforcement Administration (DEA), and the U.S. Bureaus of
    Alcohol, Tobacco, Firearms, and Explosives (ATF)--at a time
    when we are really challenged with opiate abuse, challenged
    with more and more cybercrime, challenged with the need to have
    that special expertise in States. Brenda, I am going to get to
    you on FBI, because I think we have some very serious
    challenges in staffing in North Dakota.
        Air traffic control, the Transportation Security
    Administration (TSA), all people who not only serve, wear the
    mantle of public servant and public employee, but are essential
    to the economy of my State.
        And, so, I think sometimes we look at them as an add-on or
    an adjunct, but these--whether it is people at DOI who are out
    reviewing grassland plans at Forest Service or DOI managing
    their right-of-way portfolio, these are people who try and
    integrate with the community. We have great relationships,
    certainly in law enforcement. I knew that from when I was
    Attorney General.
        With that said, I think it is important we always put this
    in the context of why it is so vital to our economies that we
    have a vibrant and available and flexible Federal workforce.
        So, with that said, Brenda, I am going to give you a
    problem and you tell me how you think you can solve it. We have
    horrible cases of abuse and drug crimes on Indian reservations.
    We do not have one FBI agent which is located in Indian
    Country. We do not have one DEA agent. We do not have one ATF.
    And, so, there is no cop on the beat for major crimes in my
    State.
        So, what they would say is, look, we just cannot get
    someone to live in New Town. We cannot get someone to live in
    Belcourt. So, what would you say to the FBI as they are looking
    at recruiting in terms of the tools that they could use to
    really provide some very high level incentives to relocate to a
    remote location, a less desirable location?
        Ms. Roberts. The first thing I would consider would be
    recruitment incentives to try to get them in the door. If they
    had folks there, I would recommend retention incentives, also--
    --
        Senator Heitkamp. They have no one there.
        Ms. Roberts. So, superior qualifications pay setting in
    order to get them on board. I would probably want to talk with
    the FBI and discuss with them a little bit more about what they
    have been doing and try to help them through the process.
        Senator Heitkamp. I mean, I think the fact that there is
    not, here, plug it in, this is the need, let us make sure that
    this happens. I mean, we hear this all the time.
        And Ms. Jacksta, obviously, I am greatly concerned about
    the problems--not because you are not a great organization,
    obviously. I think a lot of people who work for Customs and
    Border Protection and Border Patrol tend to come from the
    Southern border. The Northern border is a little intimidating,
    especially in remote places like Portal.
        We are going to continue to beat this drum. Senator Ayotte
    and I have a bill that talks about looking at the Northern
    border and the unique challenges. What would you suggest could
    be done or whether we could, in fact, have OPM be more
    responsive to some of the concerns?
        Ms. Jacksta. Thank you, Senator. I recognize that concern
    that you have with respect to recruiting and retaining
    employees in these remote areas. From a CBP perspective, I am
    not sure that it is a one-size-fits-all approach, and I will
    give you a good example. With respect to North Dakota in
    particular, we have challenges staffing both Portal and
    Pembina.
        Senator Heitkamp. Right.
        Ms. Jacksta. The greater challenge of the two is Portal.
    So, if we were to implement----
        Senator Heitkamp. For people who do not know, Portal is
    much more remote. I mean, Pembina may sound remote to you. That
    is, like, urban compared to Portal. [Laughter.]
        Ms. Jacksta. Thank you, Senator. So, if we were to employ
    the same incentive-type program for both locations, Portal
    would lose out every time.
        Senator Heitkamp. Yes.
        Ms. Jacksta. And, so, for us, we need to take a more
    surgical, precise, and thoughtful approach to each of these
    ports, sectors, stations, and branches to see what other ports
    are in the other areas, what is the workforce composition of
    those different locations, because if we want new folks, that
    might be a recruiting incentive. If you want experienced folks,
    it might be something else, maybe a relocation incentive.
        So, I share that with you because I do not know that it is
    a one-size-fits-all, but it might be a combination of a couple
    of different incentives.
        Senator Heitkamp. So, at your level of managing this are
    you looking strategically at each one of these border crossing
    locations' staffing and then creating a unique and surgical
    plan for increasing staffing and providing incentives for
    people to locate there?
        Ms. Jacksta. Senator, that is the plan that we are
    committing to take on in fiscal year (FY) 2016. I think,
    historically, we have had some limited funding for incentives.
    Candidly, before sequestration, we were spending more money on
    incentives. We are revamping that approach right now, and I
    really want to take a more strategic approach and look at all
    of the different occupations, law enforcement and non-law
    enforcement alike.
        Senator Heitkamp. What is the average length of stay for a
    Border Patrol agent in a place like Portal?
        Ms. Jacksta. I do not have the specific details on Portal.
    However, I can come back to you and I can take that for the
    record. I will say that when people go into the remote
    locations, they typically do not want to stay there for an
    extended period of time. So, one of the things we want to put
    on the table is really looking at rotational assignments and
    not to exceed.
        Senator Heitkamp. And, I would say, be a little careful
    with that, because so much of their ability to do their job is
    that relationship that they have with the county sheriff, the
    relationship that they have with the nearest chief of police,
    perhaps with, in our case, the Bureau of Criminal
    Investigation, which is managed by the Office of Attorney
    General. And, so, those relationships can really enhance the
    mission of Border Patrol. But if you simply always rotate
    someone in and out, those relationships do not get as solid.
        So, incentives to actually stay would be a recommendation
    that I would have. As you said, rotate them in and out, but
    also understand that there is a real value to those ongoing
    relationships, especially when you are serving in a law
    enforcement capacity in a remote location.
        Ms. Jacksta. Yes, Senator.
        Senator Heitkamp. You have to rely on each other.
        Ms. Jacksta. Yes, Senator, and I do recognize that we enjoy
    a high degree of camaraderie with the local law enforcement in
    your State and we often do support them, particularly on the
    air and marine side, as well.
        Senator Heitkamp. Yes.
        Ms. Jacksta. They do a lot of reconnaissance and work to
    support the local efforts there.
        Senator Heitkamp. Yes.
        Ms. Jacksta. We do value those----
        Senator Heitkamp. This is in no way--I do not want anyone
    to take this--this is in no way a complaint about the people
    who are there. We just do not have enough people.
        Border protection is a little like a balloon. If you
    squeeze it in one place, the pressure is going to go to another
    place, and if people know, look, there are these remote
    locations, there is no staffing there, this is a way to
    basically come into the country for nefarious reasons, we are
    only as good as the weakest link, right?
        Ms. Jacksta. Mm-hmm.
        Senator Heitkamp. And, so, that is, I think, a real
    challenge for us.
        Deb, I guess the only thing I want to say is you guys were
    great to work with and I think it worked well with OPM because
    you stepped up. That has not been our experience with all the
    other agencies, and I know part of that was driven by our last
    discussion here. But, what advice would you give to other
    agencies, given what you have been able to do from a DOD
    standpoint, from an Air Force standpoint, just helping them
    kind of navigate that challenge?
        Ms. Warner. Yes, Senator. Thank you. And I think the
    catalyst, as you mentioned, when you met with the OPM Director
    and got the ball rolling, and then aggressively getting at it,
    dissecting it, as Ms. Jacksta has stated, what they plan to do,
    not a one-size-fits-all.
        One of the things that I appreciated about this opportunity
    was the opportunity to visit with these two folks on my right
    and left, that we can share lessons learned and how can we get
    at this. We were behind with Minot. Obviously, we were. And we
    now have a tool kit that we can use and we have many remote
    locations. We have locations overseas that provide additional
    challenges.
        What I would say is, do not take a one-size-fits-all
    necessarily. Partner with--the labor unions in the local area
    were a huge help. The DCPAS community was a help, OPM. It is
    almost like they struggle out there and they do not want to
    elevate it because they think they can resolve it, and then the
    next thing they know, they have 150 vacancies on a 500-
    population location. We need to get at it sooner rather than
    later.
        So, those are lessons learned, and I do not want these
    folks to have to go through that, and I think I know OPM, the
    handbooks that they have prepared. But, we definitely are using
    this, not only at Minot, but other remote locations, as well.
        Senator Heitkamp. Well, I just want to thank the Department
    of Defense and the Secretary of the Air Force and, really, the
    command on the uniform side of the Air Force who really stepped
    up and said, we cannot operate the air base under these
    conditions. And, so, I think it really, like you said, it ended
    up almost being in crisis before we got there, but certainly,
    things moved very fast and very aggressively, by no small
    measure thanks to the help of the Office of Personnel
    Management.
        Ms. Warner. And if I could add, as well, not only, and you
    mentioned, Ms. Jacksta, not only the Special Salary Rate and
    how we pursue that for specific occupations that we know we are
    losing, but also, as you said, the leadership took a step out
    and said, how about for the non-Special Salary Rate we have a
    10-percent that we can add into. How about looking at the 3Rs,
    relocation and the retention that we needed, the retention and
    the recruitment incentives. And I think all of those things in
    the tool kit are what we had to apply.
        And, I can tell you, since that approval in the mid-summer
    timeframe, and earlier for the non-appropriated, we have seen a
    2 to 3 percent increase in our staffing, our ramping up. We
    have over 100 actions in the pipeline right now that we are
    pursuing, and I think we are going to see significant
    improvement over the next 6 months, ma'am. Thank you.
        Senator Heitkamp. Thank you so much. And, if I can just
    make one point, this whole problem, it seems to me, transitions
    to our broader issue, which is how do we recruit the next
    generation of Federal workforce, and we know that is a
    different animal than, we are here for a career. We are going
    to stay the rest. And the incentives that you may think you are
    offering that would drive the certainty or whatever it is, the
    retirement plan, whatever is going to drive the next
    generation, that may not be what they are looking at. And, so,
    I think we can take the lessons and the cooperation that we see
    between OPM and the agencies here and maybe take that one step
    further and think about the new Federal workforce.
        So, this is a good little exercise of meeting the next
    challenge, which to me will be--even in places where people
    want to live--recruiting a Federal workforce.
        Thank you, Mr. Chairman.
        Senator Lankford. Absolutely. Senator Ernst.

                   OPENING STATEMENT OF SENATOR ERNST

        Senator Ernst. Thank you, Mr. Chairman.
        Thank you, ladies, for being with us today. And hopefully,
    through this discussion, we can find some valid solutions to
    some of these issues. So, I think this is a very important
    topic.
        Ms. Jacksta, I will start with you. You mentioned in your
    testimony that Federal agencies are only allowed to offer those
    retention incentives to those employees that are likely to
    leave Federal service. And you also made note that it is
    because of these circumstances that CBP is unable to offer
    retention incentives to those Federal employees who do not want
    to leave Federal service, but want to move to another desirable
    location. Can you explain maybe what the rationale for that
    policy is?
        Ms. Jacksta. Thank you, Senator. For the specific policy
    guidance, I will defer to OPM. However, I would like to
    characterize some of the workforce challenges that we have and
    why this issue is important to us.
        For example, we have a lot of lateral movement between
    occupations, particularly between the CBP officer and Border
    Patrol agent occupations, and some of those are due to
    mobility. The different segments of the workforce want
    different options to be more mobile. So, in the Office of Field
    Operations with the CBP officer occupation, they might be in
    more metropolitan areas. And the Border Patrol, with the Border
    Patrol agent occupation, they might be in more remote areas.
    That is not to say we do not have remote areas in both, but
    generally speaking, that is what we see.
        And, so, if we know that Border Patrol agents are looking
    for other mobility options and are looking to go to a different
    field altogether, the CBP officer occupation, and we want to
    keep them there and offer them a retention incentive, because
    they are not leaving Federal service but they are leaving the
    occupation, we are somewhat constrained. And, so, then, what is
    the solution to address that issue?
        Senator Ernst. Right.
        Ms. Jacksta. And, so, that is where we get into, do we need
    to look at a Special Salary Rate? Do we need to look at other
    options in mobility, whether they are temporary assignments or
    other options that will allow us to meet the needs of the
    mission while also meeting the needs of this workforce.
        Senator Ernst. OK. And, Ms. Roberts, would you like to add
    on to that?
        Ms. Roberts. It is a requirement in the regulations. Why
    CBP is actually doing this is the regulations are written in
    such a way that they have to be likely to leave Federal
    service. However, I would like to be able to work with CBP to
    see if there is something that we can do in order to address
    the problem that they are having with the Border Patrol.
        Senator Ernst. Good. No, that was my next question, too,
    was is it possible to go back and revisit this policy so that
    we can find a way to make it work between these agencies.
        Ms. Roberts. I would like to take a look at that.
        Senator Ernst. Yes. Very good.
        And, again, I think that we need to look for those
    solutions here so we can actually solve these problems. So, I
    appreciate the dialogue that you have, and if you would be able
    to share that with our Committee, as well, in the future.
        And then, also, Ms. Roberts, for you, in May, this
    Subcommittee had a hearing that was entitled, ``21st Century
    Ideas for the 20th Century Federal Civil Service.'' Much of the
    discussion during that hearing focused on what is needed to
    recruit and retain the best workforce and how we needed to
    modernize the system that we are using.
        One of the things I touched on was the user frustration of
    the USAJOBS website, and I know we are all familiar with that,
    and how it has actually discouraged people or applicants from
    applying due to its really cumbersome process. And, it has been
    very hard to attract especially those young millennials that we
    would like to see coming into government service.
        Can you maybe update me on where OPM is in the process of
    revamping the USAJOBS.gov website?
        Ms. Roberts. As part of the President's Management Agenda,
    they are looking into what they call untying the knots on a
    number of different things. I am not per se the expert on the
    hiring flexibilities. There is another area in OPM that deals
    with that, but I would be happy to take that question back and
    get back with you.
        Senator Ernst. Yes. That would be very helpful. I
    appreciate that very much.
        I am going to go ahead and, again, Ms. Roberts, you
    hopefully have all the answers today here.
        Ms. Roberts. I am not sure. [Laughter.]
        Senator Ernst. There are several articles out there, and we
    have seen them, about the huge demand for work in the Bakken
    region. I mean, it is all over. People in Iowa talk about this
    a lot. And, I believe their unemployment rate is down between--
    somewhere around 1 to 2 percent, I believe. And, so, you have
    to not want to work in that area to be unemployed.
        So, one of the articles I saw, it mentioned that a
    gentleman moved to the region and had a job within one hour of
    getting there. And, I understand the salary difference is an
    issue that is specific to this region, but there are also other
    reasons why the Federal workforce is challenged to find those
    quality workers, and one of those reasons is the cumbersome and
    timely hiring process. I do hear from a number of folks that
    when they submit to USAJOBS, it is like their resume went down
    a black hole. That is one phrase I have heard before. And 6
    months later, they get some sort of acknowledgment or
    recognition that their application was received. So, we can see
    there is definitely a problem with USAJOBS.
        And then, again, going back to just different ideas, are
    there ways that we can streamline? Of course, if the other
    ladies would like to interject, as well. We really would like
    to have more of a private sector approach to hiring, if at all
    possible. Do you think that is something that can be done and
    are there efforts that we could really push to make that
    happen?
        Ms. Roberts. Again, I am not the hiring person, I am sorry
    to say.
        Senator Ernst. That is OK.
        Ms. Roberts. But I would be happy to get those answers for
    you. I know OPM has a lot that we are doing with respect to
    hiring and trying to resolve a lot of the issues agencies are
    coming in about, and we are meeting with agencies on a regular
    basis. So, any questions you have on hiring, I would be happy
    to take them and get back with you.
        Senator Ernst. OK, and we will submit those questions to
    you. I thank you.
        Any other input on the hiring process and maybe what would
    be good to streamline it?
        Ms. Warner. Senator Ernst, thank you again for the
    opportunity to speak to this. I do have the opportunity,
    representing the Air Force, to sit on some DOD committees, the
    Civilian Personnel Policy Council, for one, and we are really
    exploring all of these. The same stories you are hearing, the
    application goes into the black hole, USAJOBS, we have to have
    a better solution. Obviously, we need to fill jobs faster than
    90, 120 days, how we can get at that.
        I can tell you, as far as from a DOD perspective, the
    working groups that I am sitting on, they are aggressively
    getting at the USAJOBS and adding features under the New
    Beginnings, which was the umbrella after the repeal of the
    National Security Personnel System back in 2010. They
    established what they call New Beginnings, and New Beginnings
    is everything from a new DOD performance system for the
    Department as well as getting at the hiring process, the tools
    that are being used.
        And one of those that is part of the New Beginnings is with
    regard to more interaction with the applicant. I do not want to
    submit my resume today and 6 months goes. I have no idea if I
    am a candidate, if I am being looked at----
        Senator Ernst. Right.
        Ms. Warner. So, they give them periodic updates throughout
    the process, and they are working--they have done some
    improvements and they are still on a journey.
        And, I can tell you, with Mr. Dougan here with us, he has
    been a part of that working group for New Beginnings and
    helping us. We work and partner with our labor teams, the
    national labor unions here in the local area. How can we make
    this experience better?
        So, for Department of Defense and specifically the Air
    Force, I would like to say, we are actually taking the entire
    hiring process, from the time we anticipate--someone says, I am
    going to retire in 2 months--until the time we put someone in
    the chair, we have analyzed that and breaking it into chunks
    and leaning it, if you will, improving the business process.
    So, the Air Force is really taking that on because we realize
    and recognize we cannot afford to have the Department of
    Defense and the Air Force positions with critical missions
    going vacant 90, 120 days.
        So, we are getting at that, and the Air Force is seeing
    some improvement in our hiring process. It is just taking us a
    little bit of time to turn the Titanic, but we are getting
    there, ma'am.
        Senator Ernst. Very good. That is encouraging to hear. How
    long have you been utilizing this New Beginnings program?
        Ms. Warner. Well, actually the New Beginnings 2010 was when
    we started the journey on the performance piece and it is
    continuing to roll out. I think we are anticipating a Secretary
    of Defense memo--and I do not want to get ahead of what DOD is
    going to push out--but sometime in November, late October,
    maybe, which will speak to the New Beginnings and all that that
    entails, everything that we are trying to do to improve the
    experience and the process of hiring and the tools for our
    employees, for our managers.
        They actually put out a hiring managers tool kit. It is
    already posted out on the Department of Defense for us to use
    which guides--when we start talking personnel, we have
    managers--we are speaking a foreign language. How about a tool
    kit that can help walk them through that? So, that is actually
    being published and the Secretary of Defense is going to push
    something out to speak to that and talk to----
        Senator Ernst. That is very good. Like I said, it is
    encouraging to hear that, and as you see things that are really
    working very well within DOD, if that is something that we can
    share with the rest of our hiring managers across the board in
    Federal Government, I think that would be extremely helpful to
    all of us, so thank you very much.
        Ms. Warner. Thank you.
        Senator Ernst. Thank you. Thank you, Mr. Chairman.
        Senator Lankford. Absolutely.
        All right. Let me pile on, because I have multiple military
    installations in my State, including Tinker Air Force base,
    which is obviously a very significant sustainment depot. They
    have the same issue. They want to hire somebody, but in a great
    workforce location like Oklahoma is right now, people get
    snapped up. And, so, someone comes in, whether it is McAlester
    and the Army Ammunition Depot, or whether it is Tinker Air
    Force Base and the very large, very well qualified, excellent
    civilian workforce that is there. They have an opening. They
    come through the application process, and 4 months later, they
    hear back. Well, they are not going to wait 4 months. In
    Oklahoma, they are going to get snapped up in another job, in
    another place. And when they get the call, yes, you are hired,
    they are going to be saying, ``Great. I have already started
    and been working at a different place for the last 3 months.''
        Ms. Warner. Mm-hmm.
        Senator Lankford. Now, they have to decide if they are
    going to leave that place to be able to come back and work for
    the Air Force.
        Ms. Warner. Mm-hmm.
        Senator Lankford. This is an issue we have to solve, and it
    is more than just, ``We are going to call you occasionally,''
    because now we are stringing someone along. It has to be an
    efficient process.
        What I heard you say was, we are getting better at 2 months
    in advance to make sure there is not an opening out there, but
    to get qualified people, we have also got to have an efficient
    process. What can be done so that person is not strung along
    for 3 or 4 months in the hiring process, to be able to fix that
    part of it? So, we have a qualified person who meets the
    minimum criteria. We put them in place and start the task.
        Ms. Warner. OK. Senator, thank you. Your timing is
    absolutely perfect.
        Senator Lankford. Good. I like to hear that.
        Ms. Warner. Absolutely. At Tinker, well aware of the
    challenges that we are having in that area, working with the
    Air Force Materiel Command (AFMC). And, I believe last week,
    and it may have been the week prior, we actually sent a team to
    Tinker to peel this back. I understand they want to hire 1,000
    employees, and I do not have the occupations handy with me, but
    they want to hire 1,000 and they want to do it in 30 days. How
    are we going to get at it?
        So, we have recruiters. We actually sent folks from the Air
    Force Personnel Center to Tinker to start getting a working
    group in order, and we have been in conversation with AFMC for
    quite some time, trying to streamline everything from the
    security process. The front end of hiring, we seem to have it.
    We are basically projecting. We have provided tools. Do not
    wait until the day that you have someone leaving to start
    recruitment----
        Senator Lankford. Right.
        Ms. Warner [continuing]. Because if it takes 120 days, you
    are behind the curve. So, we have provided workforce guides,
    trying to help them get at, if you lose 10 contract specialists
    a year, then probably you need to overshoot your target and do
    not wait until they are vacant. So, we are providing those
    tools.
        But, nonetheless, what we need to do is Human Resource (HR)
    needs to be more hands on with management, and as you know, we
    have centralized at the Air Force Personnel Center, much like
    our sister services. And there are times we need to go on the
    road, and we did that. We sent a team out there----
        Senator Lankford. So, give me a good length of time. If
    someone applies----
        Ms. Warner. Mm-hmm.
        Senator Lankford [continuing]. For a job, there is a job
    opening and someone applies for it outside--now, if they are
    inside the workforce, I understand it is a different dynamic.
        Ms. Warner. Correct.
        Senator Lankford. They will be transferred to different
    places.
        Ms. Warner. Correct.
        Senator Lankford. Outside----
        Ms. Warner. All right.
        Senator Lankford. New people in this situation. How long is
    a reasonable amount of time that it should take before
    application--and they are qualified, let us just start there--
    --
        Ms. Warner. Right.
        Senator Lankford. This is a qualified individual and they
    are hired.
        Ms. Warner. OK. Obviously, the Office of Personnel
    Management goal is our 80 days from the time that we begin the
    recruitment action until we have an entrance on duty. The long
    pole in the tent, the area that takes the longest--and we are
    tracking, 15 days for a manager to take a selection. If they
    had to set up the interviews, it takes a little longer. The
    process to issue a certificate to a manager, we have that
    built, like, within 10 days from the time you receive it, you
    need to have that certificate.
        The area that we have to get at is the back--what I call
    the onboarding--security clearance, physical exam, drug
    testing. The employee getting released from their employer does
    not take that long. The part that takes so long is what we call
    the pre-employment process, and that could take and is taking
    upwards of 60 days for that piece.
        The front end, we have it pretty well through. It is the
    tail end that we have to get at, and we are trying to think of
    ways that we can do this. Obviously, we do not want to risk
    security at our locations by saying, we will bring you on with
    waivers----
        Senator Lankford. Right, and we will check you later.
        Ms. Warner. But they are doing some of that, where they can
    bring folks on and then be pursuing the security clearances.
    Obviously, there is a lot going on with OPM with the security
    area that we are trying to get through, as well.
        Senator Lankford. So, can I ask the nice person next to you
    why it takes 60 days to be able to do security clearances? Ms.
    Roberts, what do you think, and why are we stuck at this point?
        Ms. Roberts. I am sorry. I cannot speak to that question.
    That is not my area of expertise.
        Senator Lankford. We need to find a way to be able to
    resolve this because this is repeated not only for the United
    States Air Force, but all across the Federal workforce. The
    length of time that it takes to do onboard, we are losing out
    on some good people that want to be able to serve their fellow
    citizens in Federal service. They have come. They pursued it.
    They are interested in it. But they are also going to feed
    their family, and 2 months into this, they are going to give up
    and they are going to go somewhere else. They are a qualified
    person that later a manager is going to say, that is the person
    I wanted and I cannot get. Now the manager is frustrated they
    cannot get the person they want. That person is saying, I
    really wanted to take that job, but I took a different one. We
    have to figure out how to fix this. So, how do we get out of
    this cycle?
        Ms. Roberts. I understand your concerns and I will take
    that back.
        Senator Lankford. That would be great.
        Ms. Warner. And, Senator, if I could add, the folks at
    Tinker, the human resource community, the management community,
    the labor community, have really helped us, and they have
    stepped up. Over a year, we have had a working group, what we
    call Rapid Improvement Advance, to try to take chunks, the
    entire spectrum, and break it apart. So, we appreciate that
    they are really--because the Air Force Materiel Command is
    about 48 percent of our Air Force civilian population.
        Senator Lankford. Yes. No, it is----
        Ms. Warner. So, they have a vested interest in it.
        Senator Lankford. I have to say, it is a phenomenal team at
    Tinker.
        Ms. Warner. They are.
        Senator Lankford. Team Tinker is really an amazing group of
    leaders up there, from General Levy all the way through the
    process, through our civilian, our union folks. They cooperate
    very well together. But this issue is also repeated at
    McAlester. It is repeated all over multiple bases and issues
    and it is across our workforce. I am sure CBP deals with some
    of the same issues of length of time on that.
        Let me ask a question, as well. One of the things you
    talked about--and I am going to move to other people, as well,
    so I am not picking on you today. But, you talked about when we
    deal with North Dakota and that the boom started in 2006, and
    then working through the process of deciding locality pay or
    special salary packages and working through that process.
        Ms. Warner. Mm-hmm.
        Senator Lankford. The difficult thing for me to hear is the
    boom starts in 2006. The transition in jobs is well on its way
    in 2007.
        Ms. Warner. Mm-hmm.
        Senator Lankford. And special salary packages were approved
    in March and April 2015.
        Ms. Warner. Mm-hmm.
        Senator Lankford. That is a long 9 years of trying to fight
    for employees. How do we get more agile in making decisions
    across our structure, whether it is United States Air Force or
    any of our other areas, to be able to see this trend, because
    that trend goes down, as well. I mean, there will be a time, as
    it has been in Oklahoma, where I serve, and it will be in North
    Dakota some day a long time from now, when the oil boom goes
    down and suddenly that pressure is not there.
        Ms. Warner. Right.
        Senator Lankford. How do we become more agile, that it does
    not take 9 years to move from boom to we are going to adjust
    pay?
        Ms. Warner. Right. In taking a look at the history that I
    tried to do for this, and exactly what you are saying. In 2006,
    what is going on? And it gets me back to the position I had
    said earlier. Do they think they want to try to figure it out
    on their own and then they get in so deep that they are so far
    behind the curve that now it is a crisis? That could have
    happened.
        What we do know is back in 2012, we tried to pursue--they
    thought locality pay, let us get at that. Whether or not we had
    individuals who talked about Special Salary Rate, whether they
    wanted to come to the air staff, but what I see on the record
    is around 2012, they came to the air staff policy----
        Senator Lankford. Let me just ask, is the locality pay an
    easier trigger, an easier hurdle in that, or----
        Ms. Warner. No, sir----
        Senator Lankford. Tell me, when they are making the
    decision, how are they going to decide between the two, because
    I understand all those options are on the table. You have the
    3Rs.
        Ms. Warner. Right.
        Senator Lankford. You have locality pay. You have the
    special packages.
        Ms. Warner. Mm-hmm.
        Senator Lankford. How do you make the decision?
        Ms. Warner. And that is what I think, as an Air Force, what
    we have done is try to educate the community on what the tools
    are in the tool kit. And I know that OPM can speak to locality
    pay, but I will offer up what I have on that.
        The locality pay gets more at wages in the local area
    versus cost of living in the local area, and that was pursued.
    I think the Federal Salary Council, there was a package that
    went forward. It was disapproved and then we started the
    process in 2013. They tried another reattack from the
    installation. The leadership said, let us go forward, let us
    give it another shot, and it did not make it through DCPAS.
        And then, at some point, someone said, well, we have other
    tools in our tool kit, and I think OPM even offered up, hey,
    why are you not using the tools that you currently have
    aggressively? Let us put together a working group.
        So, I think, again, sir, they did not get ahead of it where
    we should have, and right now for the Air Force, we have
    provided the tools at every location, and if there are any
    locations who are struggling, what we want them to do is not be
    afraid to raise your hand and come to the air staff and say, I
    cannot figure this out, or why do you not help me? I am
    overwhelmed.
        Senator Lankford. OK.
        Ms. Warner. Because a lot of our installations, we may be
    one and two deep in expertise.
        Senator Lankford. Sure.
        Ms. Warner. So, thank you, sir.
        Senator Lankford. So, Ms. Roberts, help me out with this.
    How does that information get out? I know you released these
    different documents, these workbooks on it. You have the tool
    kits that are out there. Do you feel like the agencies now have
    the understanding of the things that are in their tool kit so
    they can be more agile in these moments? Because it obviously
    left North Dakota in a lurch in a lot of ways, in a very
    difficult situation across multiple entities.
        So, that will happen again in other places. How do we
    address this?
        Ms. Roberts. I would say, to feed off of what Ms. Warner
    has stated, we did not realize a lot of the problems that were
    happening in 2006. It was not brought to our attention at that
    point. And, I think agencies were trying to fix the problem on
    their own at that point.
        So, when 2011, 2012, and 2013 came about, that was the time
    of the pay freeze. No special rates were approved during that
    time. They were frozen. So, there was nothing that they could
    really address.
        Senator Lankford. OK.
        Ms. Roberts. So, then comes 2014, 2015. You have your
    little bit of an increase, so you start getting some relief.
    So, we have started seeing the requests come in now. We
    approved three special rate requests in 2014. I think there
    were five in 2015.
        To address the locality pay issue, individuals in the
    Bakken region started out wanting locality pay, which was not a
    viable solution. Locality pay is not a pay flexibility. It is
    something that is governed by law and regulation. The Federal
    Salary Council makes the recommendations to the President's Pay
    Agent, that is made up of OMB, OPM, and Department of Labor
    (DOL).
        Senator Lankford. That is the type of thing--they started
    chasing something----
        Ms. Roberts. That is right.
        Senator Lankford [continuing]. Doing the paperwork, doing
    the process on something that----
        Ms. Roberts. Absolutely.
        Senator Lankford [continuing]. OPM already knew it was
    going to be a dead end at that point, so----
        Ms. Roberts. And we----
        Senator Lankford. That is what I am trying to talk about,
    is how do we actually make sure in the bureaucracy and of all
    the different options they are chasing----
        Ms. Roberts. I think education, sir. I think that is the
    answer. And I think----
        Senator Lankford. Do you feel like that is happening from
    OPM now, with the new books that are coming out?
        Ms. Roberts. Absolutely. I was very happy to have the
    opportunity to go to Bakken, because that identified a lot of
    the problem for me. When we arrived at Bakken, they thought
    there was only one solution, locality pay. And we did mention
    that there were other pay flexibilities available, but I do not
    think they were educated on that process, because there were 3
    years of no one using any flexibilities at all. So, I think we
    had to go and reeducate the Federal community on what was
    actually available to them.
        Senator Heitkamp. I just want to mention something in this
    context----
        Ms. Roberts. Sure.
        Senator Heitkamp [continuing]. Because I think it goes to
    what you were saying. People on the ground get in over their
    head. They are not dealing with people in Washington, D.C., who
    actually make the decision. They are assuming, look, this is
    what--I mean, the Federal work group that was put together, led
    by Department of Interior, really, I think, did not know what
    all those tools were----
        Ms. Roberts. Right.
        Senator Heitkamp [continuing]. Because of the diversity
    represented, whether it was USDA or whether it was DOI or even
    looking at some of the other agencies. I think they just
    muddled through it until you showed up. But, it does point out
    that when you have an engaged agency, like DOD and the Air
    Force, it is a lot easier to get this done.
        Ms. Roberts. Absolutely.
        Senator Heitkamp. And, so, one of the challenges that you
    have is OPM is not going to know what the challenges are out
    there if the agencies do not bring it to them, and a lot of
    times--in North Dakota, we do not have a large Federal
    workforce, so it is the tail wagging the dog. It is not
    something that got a lot of attention until we forced it to get
    attention.
        And, so, I think to Senator Lankford, Chairman Lankford's
    point, how do we get more agencies to get ahead of it and then
    make this a priority as they are looking at the workforce?
        Senator Lankford. Those are good points. Let me go ahead.
    You can make a comment on that, as well.
        Ms. Roberts. To comment on that, I would say we are trying
    our best to get the information out to the Chief Human Capital
    Officers (CHCO). Like, for example, with the Science,
    Technology, Engineering, and Math (STEM) occupations, we are
    taking a very close look at the STEM occupations now. We are
    communicating with that community in various conferences. And
    we are just trying to get the message out. And if there are any
    other ideas that you may have, we are more than happy to
    consider them.
        Senator Lankford. OK. Let me make two quick comments, and
    then we need to move to our second panel. I will see if there
    are any other questions the Ranking Member wants to have on
    this, as well.
        Ms. Jacksta, just as a comment on this, I heard several
    times about trying to move people to remote areas. Oklahoma
    State University has done a very good job in their medical
    school of actually reaching out and recruiting people in rural
    areas to consider medical school, because they found that rural
    hospitals were having a difficult time hiring doctors because
    they were trying to hire a doctor that grew up in an urban
    place to move to a rural spot. And, so, they flipped it and
    started recruiting people in rural areas to consider medical
    school and incenting them back to rural hospitals. It has been
    a great project. Oklahoma State has been very good at it and it
    has been a quality thing.
        Is that mindset also in place, or is it a sense of we just
    open it up for CBP hiring and then we may end up sending
    someone that grew up in Chicago to try to end up in North
    Dakota and they say it is just not a fit? I would tell you,
    rural folks love going to rural areas. It feels like home to
    them. But sending someone from an urban area to a rural area is
    a big stretch. So, tell me where you are in the recruiting for
    that.
        Ms. Jacksta. Thank you, Senator. So, I would say, over the
    last 6 months, we took a very different approach to our
    recruiting and we established a National Front Line Recruiting
    Command Construct. So, we brought in our operational elements
    where we had the biggest challenge in filling positions, both
    in the Office of Field Operations and the United States Border
    Patrol and also air marine, and we used data. We actually
    gathered data over a 5-year period by zip code. We identified,
    where have we been successful as an organization in recruiting
    and retaining Border Patrol agents, CBP officers, air marine
    staff, and that data was very telling.
        And, to your point, Senator, what we had learned is a lot
    of different behaviors of where people live versus where they
    want to apply and work, and there is a lot of commonality
    there.
        We also were able to pinpoint with some degree of precision
    which zip codes we should go to, which colleges and
    universities we should go to. We looked at the unemployment
    index of those locations, thinking if we could actually make a
    bigger difference, not just satisfying our own need, but making
    a difference in these local communities where the unemployment
    index might even be higher, if we can fix that paradigm, that
    would be a win-win for everybody.
        So, that paradigm has been formulated over the last 6
    months. We issued targets to every field office and every
    sector and every branch to go out and do that recruiting. And
    thanks to the reprogramming request that was approved, we were
    able to have some additional monies allocated so that we can
    build that base and build that recruiting effort.
        Senator Lankford. OK. Wonderful. Let us know on the
    progress on that, because that will be key for actually
    recruiting people to be able to go and stay, and it may be a
    consideration to find people that have a love of working in
    rural areas, to not have to move them as rapidly, to develop
    these relationships, because that will be a key.
        And I understand that is some flexibility, as well.
    Multiple different agencies, especially in law enforcement,
    like to move everyone every 2 or 3 years. There may be an issue
    to say, this person enjoys this particular assignment. Let us
    leave them longer----
        Ms. Jacksta. Mm-hmm.
        Senator Lankford [continuing]. And allow them to be able to
    do that.
        One last thing and then we need to be able to switch to the
    second panel on this.
        Ms. Roberts, there is the flip side of this, as well. I was
    on the U.S. House Committee on Oversight and Government Reform
    (OGR) panel when we actually questioned a gentleman named John
    Beale, who worked for the U.S. Environmental Protection Agency
    (EPA), who had for years received extra retention pay,
    additional pay over and over again to be able to keep him
    because he is such a valuable employee. And then the word came
    out that he had actually claimed that he was a CIA agent and he
    really was not showing up for the EPA and it became this huge
    scandal that over years he had continued to receive retention
    pay as a valued employee, but actually he was scamming the EPA
    for years, lying to them that he is a secret CIA agent. And,
    so, he would leave and be gone for months at a time, saying, I
    am on a secret assignment. Really, he was skipping out from
    work.
        He ended up having a retirement party in 2011, but he
    actually did not retire until 2013. So, for 2 years, he did not
    show up for work and everyone at work assumed he was retired.
    He was actually still getting his paycheck. It was just a
    fiasco.
        So, on the flip side of retention pay is the accountability
    of those that use it. Understand, it is really being used for
    those folks that we really want to keep, not someone who is
    scamming the system. Now, I understand Mr. Beale is an extreme
    example of that. I get that. That is not the norm. But, my
    encouragement to you is not to be able to--you do not have to
    tell me all that. I just bring to you again, that is a good
    tool for us to have. We need to have that tool, but we need to
    also maintain the oversight of how it is used so we do not have
    someone scamming the system. Is that fair?
        Ms. Roberts. Absolutely. Agencies should be reviewing their
    3Rs every year and making sure that they are paying them
    adequately.
        Senator Lankford. Well, he got his retention pay every
    year, and that was not reviewed.
        Ms. Roberts. That is a terrible example.
        Senator Lankford. Well, to say the least.
        So, any other questions, thoughts you have for this panel?
        Senator Heitkamp. No. Thank you.
        Senator Lankford. OK. Thank you very much.
        We are going to take just a moment to break to be able to
    switch the panel.
        [Pause.]
        Gentlemen, thank you. We are going to swear in the
    witnesses.
        Our second panel is William Dougan, who is the President of
    the National Federation of Federal Employees, and Anthony
    Reardon, President of the National Treasury Employees Union.
        Gentlemen, thank you both for being here. As you know, the
    tradition of this Committee, we swear in all witnesses. Would
    you please raise your right hand.
        Do you swear the testimony you are about to give before the
    Subcommittee will be the truth, the whole truth, and nothing
    but the truth, so help you, God?
        Mr. Reardon. I do.
        Mr. Dougan. I do.
        Senator Lankford. Thank you. You may be seated. Let the
    record reflect the witnesses have answered in the affirmative.
        Mr. Reardon, due to your position at the table, you get to
    go first on this one, and then Mr. Dougan we will receive your
    testimony, then we will have some brief questions, as well.

        TESTIMONY OF ANTHONY M. REARDON,\1\ NATIONAL PRESIDENT,
                   NATIONAL TREASURY EMPLOYEES UNION

        Mr. Reardon. Thank you. Chairman Lankford, Ranking Member
    Heitkamp, and Members of the Subcommittee, thank you for
    inviting me to testify today on pay issues affecting the
    Federal workforce.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Mr. Reardon appears in the Appendix
    on page 58.
    ---------------------------------------------------------------------------
        As you know, beginning in 2011 and continuing for three
    straight years, Federal employees were subjected to a pay
    freeze. In both 2014 and 2015, Federal employees received pay
    increases of one percent, which were below the amount called
    for under the law. According to Department of Labor data,
    private sector wages have increased 8.3 percent over the last 5
    years, while Federal wages have increased by a total of 2
    percent. No employer can expect to recruit and retain a
    professional and skilled workforce while failing to keep up
    with general pay trends.
        NTEU worked closely with Senators Schatz and Cardin, and
    Representative Gerry Connolly on legislation to provide a 3.8
    percent across-the-board pay raise for 2016. Passing that
    legislation would be a good first step in getting Federal pay
    back on track.
        NTEU believes that the General Schedule, or pay system is
    capable of meeting the needs of both agencies and employees if
    agencies utilize the existing pay flexibilities available to
    them. Within the GS system, agencies are provided with a
    substantial variety of human resource flexibilities and
    authorities, including pay.
        NTEU strongly advocates that agencies should utilize the
    H.R. tools they have been given to reward high-performing
    employees by, for example, providing meaningful performance-
    based cash awards and quality step increases. Agencies should
    also use retention and recruitment bonuses to address staffing
    shortages.
        It is simply a myth that the GS system does not allow
    agencies to reward high performance or respond to a changing
    recruitment and retention environment, but these H.R. pay tools
    are just not being used enough, and the primary reason for that
    is a lack of funding.
        A competitive employer must be able to reward excellent
    performance and recruit and retain skilled employees. NTEU is
    concerned that the calls for limits to or the total elimination
    of performance-based awards would turn off the GS system's most
    useful performance management features.
        I want to be clear that agency management should have both
    a justification for and a documentation process for the use of
    these authorities, and Congress certainly has the right to
    scrutinize Executive Branch decisions. But managers need to be
    able to perform their core duties. That is, in the course of
    supervising their employees, they evaluate their employees'
    work and reward for high performance.
        NTEU has the honor of representing over 25,000 Customs and
    Border Protection officers, trade enforcement and agriculture
    specialists stationed at 328 land, sea, and air ports of entry.
    Senator Heitkamp, I know you have been heavily engaged in
    Federal workforce issues in the Bakken region, including
    addressing serious pay gaps that have developed from the recent
    oil and gas boom there. I would like to thank you for your
    interest in CBP issues on the Northern border, where the
    remoteness of these duty stations can at times create unique
    recruitment and retention challenges.
        Currently, there are approximately 300 front-line CBP
    employees at the land ports of entry from Pembina to Portal on
    the North Dakota border with Canada. We greatly appreciate your
    willingness to explore with us ways to make these regions more
    competitive, including the potential use of either special pay
    rates or recruitment and retention bonuses. I look forward to
    our continued work on this issue.
        In closing, while NTEU believes that Federal pay increases
    have been totally inadequate over the last several years, we do
    not believe the problem is the GS system, but the lack of
    agency use of existing pay flexibilities. Agencies must receive
    proper levels of funding to be able to use these flexibilities,
    or they merely exist on paper. If agencies are not adequately
    funded, they simply will be unable to recruit and retain
    talented personnel, which ultimately will only serve to harm
    the American people.
        Thank you, and I would be happy to answer any questions.
        Senator Lankford. Thank you. Mr. Dougan.

    TESTIMONY OF WILLIAM R. DOUGAN,\1\ NATIONAL PRESIDENT, NATIONAL
                    FEDERATION OF FEDERAL EMPLOYEES

        Mr. Dougan. Thank you, Chairman Lankford, Ranking Member
    Heitkamp, and Members of the Subcommittee, for inviting me to
    testify. Our union represents 110,000 Federal workers across
    the country working in 35 different Federal agencies and
    departments. Prior to being elected to national office at NFFE,
    I spent 31 years working for the Federal Government. I worked
    primarily in the U.S. Forest Service and spent 22 years
    fighting wildfires.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Mr. Dougan appears in the Appendix on
    page 64.
    ---------------------------------------------------------------------------
        The question is, does the Federal pay system have the
    flexibility it needs? I think the answer is, yes, it does. All
    the necessary tools are there for Federal agencies to recruit
    and retain the talented workforce needed to do the business of
    the American people.
        However, does that mean the Federal pay system is working
    well? No, it absolutely does not, and the primary reason the
    system is not working well these days is that the system is so
    completely starved of resources, there is no room for the
    appropriate flexibilities that have been built into the system
    to have their desired effect.
        For example, the GS pay system has locality pay areas
    clustered in metropolitan areas where non-Federal workers earn
    higher salaries and wages so that Federal agencies can compete
    for talent in those areas. This flexibility is necessary and it
    is essential to maintaining the Federal workforce in places
    like New York and San Francisco, but also in places like
    Dayton, Milwaukee, Phoenix, and Raleigh-Durham.
        The problem is that because Federal workers have not been
    given an adequate pay adjustment in over 5 years--Federal
    workers got one percent adjustments the past 2 years and frozen
    pay the 3-years prior to that--there has not been any locality
    pay adjustment of any kind for over half a decade. Instead of
    the GS system working as designed, with each locality pay area
    having its pay scale fluctuate from year to year based on
    market factors, all locality pay areas have been treated the
    same, regardless of whether the wage gap in each of those areas
    has been growing or shrinking. Because of the pay freezes and
    woefully inadequate pay adjustments, nearly all the market-
    driven flexibility that was built into the GS pay system has
    ground to a halt.
        A similar problem occurs for hourly wage grade employees.
    Their pay is supposed to be based on prevailing wages, what
    private industry is paying for comparable work in an area.
    There are 131 such wage areas spread out across the country. A
    great deal of effort is taken to survey private employers in
    these areas so that prevailing wages can be determined. Here is
    how the problem occurs.
        Adjustments to the wage grade pay scales are capped at the
    level of adjustment that GS employees in a given area receive.
    As I mentioned, in the last 5 years, Federal employees have
    seen nothing but frozen pay or one percent adjustments and no
    locality pay adjustments of any kind. That means that for blue
    collar Federal workers, frozen pay or a one-percent adjustment
    served as the maximum pay adjustment possible, even if the true
    prevailing wage in the area far exceeded that amount.
        Is it really a prevailing wage when these artificial caps
    severely constrain any upward movement in the pay scale? I
    would argue that it is not truly a prevailing wage at that
    point. Again, nearly all the market-driven flexibility that was
    built into the wage grade pay system has been stopped into its
    tracks.
        For GS and wage grade employees, the Federal pay system
    works if it is used as designed, but it cannot work well when
    being funded so inadequately.
        I greatly appreciate this hearing's focus on flexibility
    and I agree it is a very important topic, but you cannot
    discuss issues related to recruitment and retention in proper
    context without addressing the real elephant in the room, the
    diminishing prospects of being Federal employees in this
    political and economic environment.
        Here is the bottom line. It will not matter what pay
    flexibility exists when people do not want to work for the
    Federal Government any more. There will be no right balance of
    flexibility to strike or combination of tools to give managers
    when people no longer believe a Federal Government job is a
    good job, and that is where we are headed.
        Consider these grim statistics. Federal employees have
    endured $159 billion in targeted cuts over the last 5 years,
    and every year, billions of new cuts are proposed. Federal
    workers are now making an average of 35 percent less than
    workers doing the same jobs in the private sector, and every
    year that Congress gives workers an inadequate adjustment, that
    gap grows larger.
        This has to change. These are the people caring for our
    veterans, keeping our military ready, guarding our borders,
    keeping our communities safe from wildfire and other disasters,
    and performing countless other duties essential to the American
    people. We cannot keep shortchanging these dedicated Americans
    and disrespecting their service and expect it not to have
    seriously negative consequences. Federal employees need a raise
    and they need and deserve the respect of every man and woman
    serving in Congress.
        I thank the Subcommittee for holding this hearing and would
    be happy to answer any questions you might have.
        Senator Lankford. I defer to the Ranking Member for opening
    questions.
        Senator Heitkamp. Thank you so much, Mr. Chairman, and I
    thank you so much for your testimony. I think we hear it loud
    and clear, which is the discussion point that we are trying to
    get at in this hearing is, is there flexibility? Are there
    tools? Do we know what those tools are? Do agencies engage and
    use those tools to address workforce shortages and
    discrepancies in terms of market? What you are saying is,
    everybody knows what these tools are. There is flexibility. But
    there are not the resources to basically deploy that
    flexibility because the restrictions in pay, basically lock you
    out.
        So, I mean, that is a tough issue for us here, and I think
    as we look forward and we think about what it is that Federal
    employees do--and let us take Customs and Border Protection or
    Border Patrol. To you, Mr. Reardon, when you look at the
    challenges of bringing people to the border, do you hear much
    about pay, or do you hear about remoteness? What are the
    reasons why employees give on why they do not want to work in
    Portal as opposed to down in McAllen?
        Mr. Reardon. Well, I think, Senator, to respond to the
    question, I think what we primarily hear from our CBP officers
    and those who work for CBP is really about staffing shortages.
    And I think that creates a real dilemma for people, because
    with those staffing shortages come a wide variety of other
    workplace problems.
        Senator Heitkamp. Challenges.
        Mr. Reardon. If I could, I did want to sort of touch on
    something, though, that you had just said about whether or not
    everybody is familiar with all of the flexibilities. I think,
    generally speaking, people are aware of the flexibilities.
    Unfortunately, I think even what we heard from the first panel
    a little bit is that not all of the H.R. executives, I think,
    are fully conversant all the time about the various scenarios
    where it might make sense to use the various flexibilities.
        And, so, one of the things that I would urge and that NTEU
    fully supports is that--I hear loud and clear that OPM is doing
    some work on trying to make sure that H.R. folks are educated.
    But I also think it is very important that they also provide
    some real life scenarios so that these H.R. folks are not
    worrying about how do I solve this on my own. They actually
    have some tools in front of them so that they can see some real
    life workplace scenarios that they will know up front that,
    hey, there are flexibilities that I can use in this situation.
        Senator Heitkamp. Can I just expand on something you said,
    which is kind of a self-fulfilling prophecy, which is, look,
    what you do hear from them is because of staffing shortages,
    they do not want to go where they are the only one or where
    they are expected to do the work of two, three people. So, that
    is kind of a self-fulfilling prophecy. We cannot recruit
    because we do not have enough personnel.
        Mr. Reardon. Well, that is absolutely correct. And, I think
    when you look at CBP, their workplace staffing model that they
    have for CBP officers right now suggests that there are on the
    order of 2,700 additional CBP officers that are needed
    nationwide.
        And, so, I would really underscore for this Subcommittee
    that not only is that a problem in terms of the staffing
    shortages we have already talked about, but it is also a very
    important security issue for this country and it is an
    important economic issue in terms of the ability for this
    country to get the goods and services that we bring into the
    country. I think that is important.
        Senator Heitkamp. I think in my opening comments I
    mentioned the critical economic impact of not having people at
    the borders, basically long lines, inaccessibility in terms of
    trade.
        But, I want to get to something especially as it relates to
    Customs and Border Protection and Border Patrol. Because of
    this massive influx of new positions, taking a look at building
    greater border security, one of the things we heard in the
    earlier panel is the length of time that it takes to do
    background checks. Do you have any input on background checks,
    the kinds of things, security checks, how we can speed that
    process up, because I know that there is a great deal of
    concern about hiring people and then doing background checks
    later on, especially in a law enforcement capacity, so----
        Mr. Reardon. Senator, thank you. Let me just first say that
    NTEU and I completely agree that employees that are hired into
    CBP and into other Federal agencies, it is important that their
    backgrounds are checked, because we do not want to have the
    front page news stories that sometimes we end up having in
    these situations.
        In terms of, things that I would suggest that we could do
    to speed up the process, I can honestly tell you that I am
    certainly not an expert in the Federal hiring processes, and so
    how long it should take to go through the process, I am just
    probably not the best person to ask that question of. But, I
    will tell you this, that I will take that back and I will think
    about it and talk to my folks and see if we can come up with
    some suggestions and I would get those to you.
        Senator Heitkamp. Well, I really believe that what you said
    is exactly right. You do not want to go where you are all
    alone, so no one applies for those positions, no one wants to
    be there, and we end up just spiraling downward in terms of
    getting staffing. And, a lot of that is related to the
    difficulty. I mean, if you have a job with the local chief of
    police all lined up, as Senator Lankford talked about, you are
    going to move to that job. You are not going to wait the 3, 4
    months. And then you feel an obligation, as most people do when
    they take a new job, to fulfill kind of a personal commitment.
        I want to turn to locality pay. Mr. Dougan, I saw you, as
    we were talking about locality pay--this has been an awareness
    that I have built working through these problems in North
    Dakota, the difficulty of locality pay. Even if people pursue
    it, then we have problems funding it. But, in North Dakota, it
    seems to me that we should have been able to make a case for
    locality pay. When your rents are equal to New York City rents,
    you ought to be able to make the case for locality pay.
        I realize, as Senator Lankford said, these things will come
    up and down and that flexibility. But, can you comment on or
    expound on the difficulties of locality pay in a rural setting
    like Oklahoma, where they have experienced the same kind of oil
    boom that we have in North Dakota?
        Mr. Dougan. I think there are a couple challenges. One,
    locality pay, as I mentioned in my testimony, primarily
    centers--or has centered, at least historically, to this point
    in time, has centered around metropolitan areas where the pay
    rates between the private sector and the Federal Government
    essentially are great enough that it demands that we make some
    sort of a pay adjustment for the Federal sector in order for
    the government to be able to be effective in recruiting and
    retaining a workforce.
        But, the principles are the same and should apply in a
    rural setting, as well, because, really, when you boil it all
    down, the fact of the matter is that if the costs of goods and
    services in living in communities in a rural area versus a
    metropolitan area are such that you cannot afford to live there
    because of the salary that you are making, then that condition
    should--make it possible to consider having a locality pay
    there.
        Senator Heitkamp. Why do you think there is such hesitancy
    from the Federal Salary Council to actually look at broadening
    locality pay adjustments?
        Mr. Dougan. Well, the process at the Federal Salary
    Council--I was a member of the Federal Salary Council for the
    first years of my term as President, and I have to tell you
    that it is a very cumbersome process. It takes a long time.
    There are a lot of hoops that have to be jumped through on the
    part of both the State and the local communities and
    metropolitan areas. You have to get the local government
    engaged. You have to get the State government engaged. They
    make presentations. They collect data. And, it is very
    cumbersome and it can take, like, 2 or 3 years to even reach
    the point where they are going to make a decision.
        Senator Heitkamp. From my standpoint, we ended up doing a
    work around, what I would call a work around in terms of
    special pay rates when we did not really address the real
    issue, which is we have a locality pay problem in the entire
    Federal workforce. And as a result, when you look at it, what
    happened to us is we have to go around to each one of these
    agencies and get them fully engaged as opposed to, say, across
    the board the Federal workforce is stressed in the Bakken and
    we need to make pay adjustments. And, so, it was just so
    disappointing, I think, for me to realize that. I could make an
    intellectual case for a locality pay adjustment, but there just
    was not the ease in the system of getting this done.
        And, I would be really interested in your further thoughts
    on how we, having served on the Federal Salary Council, how we
    could streamline that process or make it more available so that
    people do not knee-jerk. Really? Williston, North Dakota? And,
    we got that. I mean, it is not New York. And I am, like, well,
    then rent an apartment for under $2,500 in Williston, North
    Dakota, which was the going rate. And we are still, for a two-
    bedroom apartment in Williston--I talked to the mayor
    yesterday--it is $1,500.
        So, even though we have seen oil prices decline and
    activity ebb somewhat, we still have a huge need to treat--and
    as a result, when we looked at this yesterday in Indian
    Affairs, not having that Federal workforce--we have a great
    story to tell with DOD stepping up--but not having the Federal
    workforce has cost the tribes millions of dollars, has caused
    million of dollars' worth of headaches for the drilling
    industry, and these are jobs that are critical to continuing
    this effort to produce oil in our country and become energy
    secure.
        So, I am curious about how we can improve the Federal
    Salary Council process on locality pay.
        Mr. Dougan. I think there are opportunities to look at
    expediting the data collection part that has to happen on the
    front end before a proposal ends up in front of the Federal
    Salary Council. There is a lot of data in terms of costs of
    goods and services and wages that takes place in order for that
    locality area to make its case before the Federal Salary
    Council.
        Senator Heitkamp. Have you ever seen any of these locality
    pay decisions come on and off? Is that part of the resistance,
    that it is, like, if you give a locality pay adjustment, it
    seems more permanent rather than doing a look-back and
    adjusting it on and off?
        Mr. Dougan. Well, I think--again, I go back to my
    testimony. I mean, the basic principle of a locality pay, it is
    a market-based system----
        Senator Heitkamp. Yes.
        Mr. Dougan [continuing]. So we understand that when the
    economics are such in a locality area that the cost of living
    is high, then the locality pay is going to reflect that. You
    are going to have a higher locality pay. When and if, to use
    your example in North Dakota, when and if the oil dries up and
    the prices of goods and services shrink, then there would be,
    or should be, a corresponding shrinkage in the amount of
    locality pay that would be paid.
        So, for me, I think there is a certain hesitancy on the
    part of the Federal Salary Council, but even more than the
    Federal Salary Council, the President's Pay Agents and the
    others that make the decision on whether the locality pay is
    actually going to be instituted or not, there is this notion
    that once it is there, you never get rid of it. Well, there is
    really no need to get rid of it if it is market driven, because
    the pay adjustments will go up and down based on what is
    happening in terms of the costs of goods and services within
    that area.
        Senator Heitkamp. I think it is one of the problems that we
    have with the Federal Government across the board, which is
    one-size-fits-all, and we come from very diverse kinds of
    backgrounds, and if you take a look at the VA, staffing the VA
    with surgeons in Fargo may be much more difficult than staffing
    the VA with surgeons in Minneapolis, at their VA. And, so, we
    have to--that is a real concern for me, that it really takes a
    United States Senator to pound the table a little bit so that
    we can get opportunities to keep a workforce in Minot. It
    should not be that way. There should be something within the
    system that treats Federal employees a little differently. So,
    we will continue to think about this.
        Thank you very much, Mr. Chairman.
        Senator Lankford. Gentlemen, thank you for your advocacy
    and for standing up and getting a chance to speak out for
    folks. You are speaking out for millions of folks that are
    serving our Nation every single day, and I want you to know I
    appreciate that very much.
        All these are hard decisions, as Senator Heitkamp had
    mentioned, as we deal with $430 billion worth of deficit this
    year and all the realities that face our Nation with $18.5
    trillion in total debt. These are very real areas that affect
    all of our families, but especially the Federal families. So,
    we understand full well the difficulty of these decisions,
    whether it is the President's recommendation to raise Federal
    salaries by one percent or whether it is Congress working
    through it or different members making recommendations, we all
    get the dynamics. But, there are some unique challenges.
        I would love to be able to sit and visit for a while. I am
    getting word that at 11, which was 4 minutes ago, they are
    calling votes. I am listening for the bells here at this point,
    but I understand it is coming at us in a hurry.
        I do want to make a quick statement here. Both of you have
    mentioned the GS schedule and that you think the GS schedule is
    adequate. It is just the funding behind it in the different
    agencies to be able to give the different managers the ability
    to be able to do some merit increases and such within the GS
    structure. Are there any recommendations that you would make to
    the GS structure or at this point, are both of you content to
    say, it is fine, we just need to add funds behind it?
        Mr. Reardon. Mr. Chairman, thank you. I would say that I do
    believe the GS system-- the system, not just the General
    Schedule, but including all of the flexibilities--I think it is
    a system that is very good and works for the American people
    and for Federal employees. But, I do believe that we have to
    ensure that there is available funding for these flexibilities,
    because if we do not really use all of the flexibilities that
    are available in concert with the GS schedule itself, then I
    think we run into the problems that we have seen. So, yes, I do
    think as long as we use the workplace flexibilities, I do
    believe it will work.
        Senator Lankford. OK. Thank you. Mr. Dougan.
        Mr. Dougan. I would echo what Mr. Reardon said. I believe
    the system works. I think the system is fine. The challenge
    that we have is twofold. No. 1, we have to ensure that when pay
    adjustments are given to Federal employees that we actually
    have the money to make good on those, so that we can allow the
    locality pay marketplace fluctuations to occur and to fund that
    system so that it works properly.
        With respect to the other flexibilities that we have, like
    recruitment, retention, relocation, I think that those are good
    tools. I think the tools work. The main problem that we have
    there, again, is one that in times where budgets are tough and
    lean for Federal agencies, often, we will see the first
    things--if you have to start looking for places to cut, these
    types of incentives are often looked at first by agencies to
    either reduce or to do away with altogether, because they have
    to ensure that they continue to have to pay the workforce and
    anything over and above that, in some cases, in a very lean
    budget, is looked at as a luxury.
        Senator Lankford. Gentlemen, thank you for being here and
    for your testimony, your written testimony and your
    preparation, as well.
        Before we adjourn, I would like to announce the
    Subcommittee will hold a joint hearing with the House
    Subcommittee on Oversight and Government Management on the
    protection of sensitive personal information on government
    databases Tuesday, October 27. That is next week.
        That concludes today's hearing. I would like to thank our
    witnesses for their testimony. The hearing record will remain
    open for 15 days for the submission of statements and questions
    for the record.
        With that, this hearing is adjourned.
        [Whereupon, at 11:08 a.m., the Subcommittee was adjourned.]

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